US private equity firm Century Bridge Capital has sold a 43.24 percent stake in a mainland China residential project to partner Jingrui Holdings for $41.8 million, according to a statement this week by Jingrui to the Hong Kong stock exchange.
The share sale in the development in Wuxi, a city of six million people in China’s Jiangsu province, represents a first exit from Century Bridge’s debut fund, which focuses on middle-income housing in China’s second-tier cities. Century Bridge’s exit comes just over two and half years after the Dallas-based firm bought its stake in the $217 million project from Jingrui for $32 million.
Cashing in on Housing in Second-Tier Cities
“Our approach has allowed us to source prime development opportunities such as the Wuxi project and structure ventures that meet the mutual investment criteria of our joint venture partners and investors,” Century Bridge President Wei Deng said in a statement.
Century Bridge and Jingrui are conducting the sale of the stake in the 1,694 unit development in Wuxi’s Xishan district through a pair of offshore vehicles, with closing expected in the second quarter of 2017.
“A critical and differentiating component of our strategy was to work together with experienced Chinese joint venture partners. Jingrui Holdings, an established national development company, was a perfect fit with that strategy and with them we were able to jointly determine a unit mix of townhouses and high rise units for the Wuxi development that met market demand and then successfully execute our construction, development and marketing strategies for the project,” Delatour said in a statement.
Century Bridge Aiming for $400 Mil for Second Fund
In March of this year the US private equity firm, which is headed by real estate investment veteran Tom Delatour, invested $11.5 million in a Jingrui project in Ningbo, China from its second fund. Century Bridge China Real Estate Fund II held a first close of $59.7 million in September last year, according to statements filed by the fund’s managers with the US SEC. Century Bridge is targetting total investment of $400 million for this follow-on fund.
Century Bridge’s first fund raised over $170 million of total committed capital from 10 global institutions in 2012.