Ascott launches China Incubator Fund

ASCOTT Group is looking to tap into private equity money with the launch of a $US300-500 million fund.

The Ascott Residence (China) Incubator Fund is a closed-end private equity investment fund.

This is the first private equity fund to be launched and is marketed to institutional investors and high net worth investors.

The fund will be an opportunistic real estate fund investing primarily in selected regional cities of the People’s Republic of China. The fund will acquire and reposition suitable properties or developing greenfield sites into properties which are used, or predominantly used, for serviced residences or rental housing.

The completed properties will be managed by members of the Ascott Group under one of its established brands, until the properties achieve stable operations and their income yields are attractive for divestment to other entities.

The company will hold an equity stake in the fund of at least 30% of the target fund size subject to a maximum of $US200 million. Fund raising is expected to close by the second quarter of 2007.

After the close of the fund, it will have three seed investments including the Citadines Shanghai Biyun, situated in the city of Shanghai; Citadines Xi’an Central, situated in the city of Xi’an, and Somerset Youyi, situated in the city of Tianjin.

Australian Property Journal