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CapitaLand debuts $300mn private equity fund

Released at: 16:24, 22/08/2017

CapitaLand debuts $300mn private equity fund


CapitaLand Vietnam Commercial Fund I the first in a series of investment opportunities.

by Linh San

CapitaLand Limited has successfully set up its first commercial fund in Vietnam - the CapitaLand Vietnam Commercial Fund I (CVCFI). The first in a series of investment opportunities, CVCFI has closed at $300 million, according to a company press release.

Mr Lim Ming Yan, PGCEO, CapitaLand LimitedInvesting in a Grade A commercial real estate in Vietnam, CVCFI will have a life span of eight years. CapitaLand will hold a 40 per cent stake while the remainder will be held by major institutional investors.

“Scaling up in the real estate sector requires strong financial capacity and flexibility,” said Mr. Lim Ming Yan, President and Group CEO of CapitaLand Limited. “By proactively working with reputable capital partners to build scale, we can be nimble and react fast to seize growth opportunities. We see increasing investor interest in Southeast Asia, in particular Vietnam. CapitaLand is positive about the growth trajectory of Vietnam and foresee that this trend will continue for at least the next ten years.”

Besides the growing demand for residential properties due to urbanization, CapitaLand also sees strong potential upside in the commercial real estate sector given the mismatch between demand and supply of quality office space.

“Having firmly established CapitaLand in key gateway cities like Ho Chi Minh City and Hanoi, we are able to leverage our developer - owner - operator capabilities and strong fund management expertise and harness synergies across asset classes to deliver better risk-adjusted returns for investors,” he said.

CVCFI brings CapitaLand a step closer to its goal of raising funds and having total assets under management of up to $10 billion by 2020. “It comes on the back of our largest private equity partnership, the $1.5 billion Raffles City China Investment Partners III, which invests in prime integrated developments in gateway cities in China,” Mr. Yan added.

“Having been part of the Vietnam’s growth story for over two decades, CapitaLand has earned a reputation for delivering quality residential developments and serviced residences in key cities,” said Mr. Chen Lian Pang, CEO of CapitaLand Vietnam. “In January this year, we made our first foray into commercial real estate through our acquisition and development of an international Grade A office tower in the CBD of Ho Chi Minh City, which will feature a direct connection to an upcoming metro station. With the completion of this development in 2020, we will continue to diversify our portfolio and strengthen our foothold in the country.”

“Tapping into the appetite for innovative offerings, such as co-working spaces, CapitaLand has partnered with the country’s largest co-working space operator, Toong, which opened their first office in Ho Chi Minh City at CapitaLand’s The Oxygen mall, within the residential development, The Vista,” he went on. “We are committed to being a long-term player in Vietnam and will continue to seek opportunities to grow our presence through strategic investments.”

Vietnam is the third-largest market for CapitaLand in Southeast Asia, after Singapore and Malaysia. It has nine residential developments, 22 serviced residences with over 4,700 units, and one international Grade A office development in six cities in Vietnam.

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