RREEF has made its first entry into China’s property market with an investment in a large residential project in Zhuhai, China.
The real estate and infrastructure investment management arm of
Deutsche Bank, plans to develop a US$225 million residential project on a 1,142,555 sq (106,146 sq m) parcel of land in Zhuhai.
The project, which will be called ‘Zhongzhu Uptown’, will comprise 2000 apartments in around 20 towers and a small number of retail units. It will be built over the next three years.
RREEF has teamed up with joint venture partners New Genesis International – a Macanese investor – and two Chinese co-investors Zhuhai Zhong Zhu Stock, a Zhuhai property developer, and its sister company Xihai Group.
Genesis and Zhongzhu have already undertaken a residential project together in Zhuhai. RREEF has a 50% interest in the project while New Genesis has a
25% share, and Zhongzhu and Xihai have a 20% and 5% share respectively. Zhongzhu has been appointed project manager of the project.
Zhuhai is a coastal city located in the Pearl River Delta region in southern China, near Macau. The Pearl River Delta region is one of the country’s fastest growing economic and manufacturing centres with a population of around 50 m people.
“China is a particularly attractive emerging real estate market given the pace of growth of its economy,” said Kurt Roeloffs, Asia Pacific head of RREEF. “RREEF has been actively looking for the right entry opportunity to China for some time. We like the middle-income residential sector where we believe there is strong demand and a structural shortage of supply. Our project is located in one of China’s fastest growing economic centres and we are developing the project with experienced local partners.”
Roeloffs added: “Continued strong economic growth and positive structural changes, coupled with a relative shortage of types of good quality real estate means the medium to long-term prospects for real estate market fundamentals in China remain very good.’
RREEF was advised by Lang La Salle.