ESR, a Hong Kong-listed real asset manager, has established a 10-billion-yuan ($1.3 billion) RMB Income Fund, its largest to date, in partnership with a leading insurance company in China, according to a company release.
The fund will be seeded with a prime logistics portfolio of 2.3 billion yuan, or a total gross floor area over 350,000 square metres, from ESR’s balance sheet. The transaction is expected to be closed in the second half of this year, subject to regulatory approvals, the release said.
The portfolio consists of six strategic assets in major logistics and industrial hubs across different regions in China, including the Yangtze River Delta Region, the Greater Bay Area, and the Beijing-Tianjin-Hebei Region.
“Our largest-ever RMB income fund in China despite the challenging macro-economic environment…. testifies to the strong relationships and track record which ESR has built with domestic RMB investors, and the compelling long-term income potential of our portfolio of well-located and premium logistics assets in China,” said Jeffrey Shen, co-founder and co-CEO of ESR.
Shen added that this initiative is in line with ESR’s focus on accelerating its asset-light strategy, which enables it to recycle the capital and further grow the fund management fee business.
ESR is the largest real asset manager in the Asia-Pacific region and the third-largest listed real estate investment management globally.
With approximately $150 billion in total assets under management (AUM), its fully integrated development and investment management platform extends across the key APAC markets, including China, Japan, South Korea, Australia, Singapore, India, and New Zealand. ESR is the largest sponsor and manager of REITs in APAC with a total AUM of $46 billion.