CITIC Capital Holdings Raising $600M Fund

CITIC Capital Holdings Ltd. is raising a $600 million property fund to make retail investments in second- and third-tier Chinese cities, Reuters reported Tuesday. The fund, which is partly owned by China’s sovereign wealth fund, held a $225 million first close.

(Reuters) – CITIC Capital Holdings Ltd, part-owned by China’s sovereign wealth fund, said on Tuesday that it is raising $600 million for a fourth property fund, to invest in the retail sector in second- and third-tier Chinese cities.

The fund had already held a first close on $225 million and made its first investment in the ID Mall in Changsha in Hunan province, Senior Managing Director and head of CITIC Capital’s Real Estate Group Stanley Ching told Reuters.

The mall has a gross retail floor area of about 86,000 square metres.

“We bought it from a local investor, but it’s not finished so we are completing it,” said Ching on the sidelines of the MIPIM Asia event in Hong Kong.

The fund, CITIC Capital China Retail Properties Investment Fund, would invest through acquisitions and co-investments, with a high proportion in retail properties, he said, adding that it had already received investments from institutional investors in the United States, Europe and Asia.

CITIC Capital’s first property fund invested in distressed assets, while its second focussed on residential projects and the third covered multiple sectors, Ching said.

CITIC Capital Real Estate Group has invested in 18 projects with a total asset value of more than $3 billion.

CITIC Capital is owned by China Investment Corp, China’s sovereign wealth fund, CITIC International Financial Holdings Ltd and Hong Kong-listed CITIC Pacific Ltd. (Reporting Sam Shen in SHANGHAI and Alex McMillan in HONG KONG; Writing by Stephen Aldred; Editing by Chris Lewis)