CapitaLand Investment Limited (CLI) announced the first close of its sixth onshore renminbi (RMB) fund, China Business Park RMB Fund III (CBPF III), on August 13. The fund secured an initial equity commitment of RMB1.2 billion ($222 million) to invest in the business park sector in China.

The close-ended fund is expected to add RMB2 billion ($370 million) to CLI’s funds under management when fully deployed. An undisclosed onshore institutional investor has been secured as the fund’s anchor investor, while CLI will maintain a sponsor stake in the fund, in line with its asset-light strategy.

CLI will also recapitalise Ascendas iHub Suzhou business park by divesting it as a seed asset to CBPF III for RMB1.4 billion ($259 million).

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Located in the Suzhou Industrial Park, Ascendas iHub Suzhou comprises four mid-rise and 11 low-rise buildings with a total gross floor area of about 1.84 million sq ft. It houses several international and domestic biomedical and IT enterprises, and is located in close proximity to the Suzhou Metro Line 2. The building also has a gold certification in Leadership in Energy and Environmental Design.

Kara Wang, chief investment officer of CLI China, says that the launch of CBPF III brings CLI’s total domestic capital raised to nearly RMB50 billion since 2021. The recapitalisation of Ascendas iHub Suzhou also demonstrates the firm’s strategy to recycle quality assets from its balance sheet into its RMB funds as part of a China for China capital management strategy, she remarks.

“This marks our second recapitalisation this year following the divestment of a 95% stake in Capital Square Beijing into a joint venture. With the government’s continued focus on technology and industrial transformation, we see prime business park opportunities for CBPF III, both from CLI’s portfolio as well as third-party assets,” Wang adds.