BEIJING-Locally based Harvest Fund Management, China’s second largest fund manager at approximately $37 billion in assets under management, is launching a joint venture with Grosvenor Fund Management. The newly launched Harvest Real Estate Investments is intended to help both domestic and international investors locate real estate opportunities across the major sectors within Greater China.
In a statement, Harvest Group CEO Henry Zhao says the new venture is “an integral part of the Harvest Group’s continued expansion into the alternatives sector and global capital markets.” HFM will invest into the business through its alternative investments arm, Harvest Alternative Investment Group. GFM is the asset management arm of UK-based Grosvenor, and has been active in Asia for the past 20 years.
Leading the new venture will be Rong Ren, formerly managing director and CEO of Harvest Capital, no relation to HFM. He’ll lead a team of 20 professionals based in HFM’s Hong Kong and Beijing offices. In addition, professionals from both GFM and HFM will also join the dedicated real estate platform, according to a release.
In an interview with the Wall Street Journal last week, Ren said China is going through a “huge transformation” in its real estate sector. Although investors tend to focus on residential real estate in China, they’re moving increasingly to other forms of real estate, including serviced apartments, logistics and warehouses, Ren told the WSJ.
Furthermore, Ren told the newspaper, the fundamental growth story of China’s real estate sector remains intact, notwithstanding the troubles that developers faced this year as policymakers tried to curb property prices and tighten credit. He added that the sector would likely see a wave of consolidation, since “there are about 65,000 registered developers in China right now.” That being said, takeovers among Chinese developers are rare.
The announcement from HFM and GFM occurred as Reston, VA-based Calkain Cos. inked an exclusive partnership with China-based Platinum Investment Corp. to source deals in that market. Already, EVP David Sobelman told GlobeSt.com last week, there is some $50 million of transactions in the company’s pipeline. “This has been a deal long in the making; however, it’s moving very fast for us,” Sobelman said.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
