Singapore-based asset manager, Keppel Capital Holdings, has teamed up with an, as yet, unnamed global institutional investor, to launch a China-focused logistics property fund.
This is Keppel Capital’s first China-focused logistics property fund and is targeting an initial total equity commitment of RMB1.4bn, with an option to upsize, doubling this amount by the end of 2021. The fund will invest in the development of logistics facilities in key logistics hubs in China and Keppel Capital’s subsidiary Keppel Capital China will serve as the fund’s investment manager.
A pipeline of potential assets has been identified and will be developed with the support of a leading Chinese logistics developer and operator. The fund will target Grade-A logistics facilities in the Greater Beijing, Greater Shanghai and Greater Bay Area, an area that includes Shenzhen, Guangzhou, and Hong Kong.
In an announcement release by Keppel to mark the launch, Ms Christina Tan, CEO of Keppel Capital, said, “Despite the challenges brought about by the COVID-19 pandemic, Keppel Capital has continued to work with Keppel’s eco-system of companies and other industry partners to create and capture compelling investment opportunities across a range of asset classes. In 2020, Keppel Capital raised close to $4.5 billion, including commitments from large global institutional investors, reflecting the strong demand for real assets with cash flow that can serve as long-term inflationary hedges.”
Logistics continues to be the hottest sector in real estate in 2020/21. The COVID-19 pandemic has accelerated the growth of China’s already fast-growing online marketplaces, spurring demand for logistics facilities from third-party logistics, e-commerce and retail companies.
“Through the fund and our collaboration with our local logistics property partner,” Ms Tan continued, “we look forward to delivering modern logistics facilities for key cities in the Chinese market, while also generating attractive risk-adjusted returns for our investors.”
With approximately S$37bn in assets under management, Keppel Capital is one of Asia’s leading asset managers. The company is a subsidiary of the Keppel Corporation, one of Singapore’s flagship multinational companies with a global footprint in more than 20 countries.