Pamfleet Reaches $100M Final Close on 2nd China Real Estate Fund – Exclusive

Hong Kong-based Pamfleet has raised $100 million for its second mainland China real estate investment fund, according to sources familiar with the company’s operations who spoke with Mingtiandi.

Pamfleet Shanghai Real Estate Fund II, which reached a final close at the end of April, is targetting value-add investment opportunities in core locations of Shanghai and other first tier cities, Mingtiandi was told, now that the company led by former Jardine Fleming executive Andrew Moore has successfully deployed 90 percent of the capital raised for its first Shanghai fund.

The mainland financing news comes as Pamfleet prepares to reach a $450 million final close on its Hong Kong and Shanghai-focused Pamfleet Real Estate III fund, which also follows a value-add strategy.

Pamfleet Expands Partnership with Deson

With Pamfleet Shanghai Real Estate Fund I having invested in residential and office projects in Shanghai since it closed in 2016, the new vehicle is said to be targetting opportunities across the residential and commercial sectors, including sharing economy strategies such as co-living and co-working.

For this second investment fund Pamfleet is further formalising a relationship with Hong Kong-listed Deson Development International Holdings (HK:0262) which will act as a co-general partner for the vehicle, after cooperating with Pamfleet on a pair of investments under the first China fund. Under the co-general partnership arrangement, Pamfleet is said to retain a majority status.

Pamfleet, whose mainland China operations are led by Managing Director Kelvin Wong, is said to have already lined up some potential investments for its new fund, with an interest in exploring ways to use more retail strategies to complement their expertise in residential and office projects.

For its Hong Kong and Shanghai-focused fund, Pamfleet was reported last month by PERE to have already raised $435 million toward its $450 million hard cap, with a final close expected to happen this month.

Three Shanghai Projects Now Complete

Pamfleet chose co-living for its Shanghai investment debut in 2016 when it teamed up with Deson for a RMB 82 million joint venture residential project near the Shanghai Botanical Garden in the city’s Xuhui district.

That repositioning of a suburban hotel resulted in a 67-unit co-living project which hit the market last year as Cohost West Bund.

Pamfleet also went with residential for a serviced apartment project in Shanghai’s Changning District which it purchased in July last year, also partnering with Deson on that project.

Having acquired the eight unit twenty-plus year-old asset on Wuyi Road near West Yan’an Road from a Hong Kong family, the company has since been busy refitting the apartments and expects to complete the project at the end of June and begin marketing in the second half of 2019.

Following that pair of residential projects in Shanghai, Pamfleet’s Kelvin Wong now says the company is relatively experienced in underwriting co-living and serviced apartment projects in China’s first tier cities.

Buying From Blackstone on Huaihai Road

In addition to its residential efforts, in December last year Pamfleet also picked up an office asset in Shanghai, paying Blackstone RMB 410 million for the top four floors in Citypoint, a grade A office building on West Huaihai Road near the intersection with Hongqiao Road and the Hongqiao Road metro station on lines 3, 4 and 10.

Pamfleet acquired the 6,667 square metre set of assets from Blackstone for the equivalent of just under RMB 61,500 per square metre, with the space only 50 to 60 percent occupied at the time of the transaction.

Blackstone had acquired the strata floors through its 2017 buyout of Hong Kong-based media company Global Sources, which had used the space for its offices in Shanghai.

With one of the floors still leased by the formerly NASDAQ-listed B2B media firm, Pamfleet is understood to have already boosted the occupancy to above 75 percent by leasing the top floor of the tower to a local co-working operator, with another floor leased to an additional tenant.