CapitaLand sells Shanghai office to discretionary fund for US$452m

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Singapore-listed CapitaLand has sold the Innov Center in Shanghai’s Yangpu district to its maiden discretionary fund, CapitaLand Asia Partners I, for RMB 3.1bn (about US$451.6m).

The real estate firm raised US$391m in the first closing of CAP I last month, with plans to focus on assets in Singapore, Beijing, Guangzhou, Shanghai, Shenzhen, Osaka and Tokyo.

“Shanghai Innov Center, a predominantly office integrated development located in a mature, technology-focused decentralised office market, was acquired in 2017 to be the seed asset to kickstart CapitaLand’s discretionary fund business,” CapitaLand Group CEO and president Lee Chee Koon said in a statement.

Innov Center in Shanghai’s Yangpu District, China

“Since acquisition, CapitaLand, through our market-leading asset management capabilities, has successfully added significant value to the property through asset enhancement initiative and active leasing management, to meaningfully de-risk the property on behalf of CAP I investors.”

The deal is scheduled to close in 3Q19.

CapitaLand plans to divest the Pufa Tower, an office development in Shanghai’s prime Lujiazui CBD, to CAP I as well.

A joint venture between the firm and an unnamed investor bought a 70% interest in the 34-storey building for RMB2.75bn (S$546m) in January.

The company set a minimum S$3bn annual divestment target to recycle assets.

CapitaLand received shareholder approval to proceed with its S$11bn acquisition of property firm Ascendas-Singbridge and its S$23.6bn of assets under management last month.

Headquartered and listed in Singapore, CapitaLand owns and manages a global portfolio worth more than S$103bn.