InfraRed NF leads second round of US$156m mezzanine financing deal for Fullsun International
|Category||Asian Real Estate / Hong Kong|
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InfraRed NF, a leading Greater China real estate investment manager, is pleased to announce a second round of financing to Fullsun International Holdings Group (“Fullsun International”), a Hong Kong-listed property developer, to fund the acquisition of multiple projects as part of a strategy to accelerate Fullsun International’s growth. Fullsun International is the listed vehicle of Fusheng Group whose residential contractual sales were c.RMB62bn (c.US$9bn) in 2018 according to Soufun.
The latest funding to Fullsun International brings the total capital provided by the InfraRed NF consortium to US$156m. The InfraRed NF consortium includes Metro Holdings Limited (a Singapore-listed company), Global Gate Capital, as well as a leading global alternative investment management firm and a leading Chinese financial institution.
The loan is secured on a portfolio of three ring-fenced projects comprising two residential mixed-use projects in Changsha and a residential project in Zhongshan, with additional credit enhancement provided from an office asset in Hong Kong. The existing portfolio has generated contractual sales of c.US$150m since January 2019.
The portfolio recently grew to include Zhongshan, part of the Greater Bay Area (“GBA”). The GBA is a cluster of 11 cities including nine cities in the Pearl River Delta, Hong Kong and Macau, with a total population of around 70 million. In 2018, the combined GDP of the GBA reached US$1.6 trillion, or 12% of the national economy, even though it is home to only 5% of Greater China’s population.
To date, InfraRed NF has completed 11 credit investments in excess of US$650m of capital in Greater China, seven of which have been exited. This new loan is a continuation of InfraRed NF’s investment strategy to concentrate its lending activity on projects in megahubs, which benefit from higher than national average GDP per capita, population growth rates, and infrastructure investment.
Grant Chien, Head of Special Situations Financing at InfraRed NF, commented:
“Building long term relationships and tailoring bespoke solutions for our partners are fundamental to our business. We are pleased to further extend our strategic financing to Fullsun International, and to collaborate with multiple global institutional investors for this transaction.
Focusing on cities with attractive demographic growth, strong affordability and infrastructure improvement helps to provide natural downside protection. With our latest investment in the Greater Bay Area, our portfolio companies are now present in four megahubs.”
Stuart Jackson, Chief Executive Officer of InfraRed NF, added:
“China’s long-term deleveraging continues to create compelling risk-adjusted returns for us in both the value-add and mezzanine space. This transaction provides further evidence of our leadership position in structuring private credit in Greater China.”
About InfraRed NF
InfraRed NF is a Hong Kong-based joint venture between InfraRed Capital Partners and Vervain. Established in 2007, InfraRed NF is a leading investor in Greater China real estate with a proven track record of delivering superior returns through a combination of mezzanine financing and value-add investing. InfraRed NF has invested over US$1.75 billion across 23 transactions in Greater China.
InfraRed Capital Partners is a leading global investment manager focused on infrastructure and real estate. It operates worldwide from offices in London, Hong Kong, New York, Seoul, Sydney and Mexico City and has launched 18 funds including two listed companies on the London Stock Exchange. With c.160 professionals, InfraRed Capital Partners manages US$12bn of equity in multiple private and listed funds, primarily for institutional investors across the globe.
Vervain (which includes entities operating under the former name of “Nan Fung China”) is a private company established in 2004 and based in Hong Kong. Vervain has a diversified real estate business, including property investment, property development, project management and real estate private equity investments. Vervain’s property portfolio comprises high quality residential, commercial, industrial, serviced apartments and hotel projects in Hong Kong and other global cities including London, New York, Seoul, Tokyo and Da Nang. The company’s financial investments include global equities, fixed income portfolios and fund partnerships.