Strategic Capital took a $140M stake in the 110 Charlton Street project
A US-based subsidiary of China’s largest construction firm has entered the New York City real estate market by taking a $140 million stake in a Manhattan condo project.
Strategic Capital, an investment affiliiate of state-owned China State Construction and Engineering Corp (CSCEC), announced this past week that it is taking an undisclosed stake in a 170-home project planned by US developer Cape Advisors and private equity firm Forum Absolute Capital Partners at 110 Charlton Street in Manhattan’s Hudson Square neighborhood.
The joint venture project, which will be built by CSCEC US affiliate Plaza Construction, is the latest in a series of American investments by the $39 billion Chinese mega-builder.
Strategic Capital Kickstarts Dormant $350M Project
Strategic Capital announced its participation in the 27-storey development after Cape Advisors and Forum Absolute filed new plans for what had been a long dormant project last November. The partners now say they plan to break ground on the project next month with units scheduled to go on sale in the spring of 2018. A representative of Strategic Capital has estimated the project value as “north of $350 million.”
In a statement Linsen Zhang, President of Strategic Capital appeared to take credit for the recent progress on the luxury residential project. “This investment demonstrates our in-house ability to identify, finance and develop large scale real estate assets, Zhang said. “We delicately structured this project and refined the design to move it forward quickly, which would maximize the benefits for all parties.”
The 21,238 square metre (228,602 square foot) building is slated to include 260 square metres (2,800 square feet) of retail space in addition to condos averaging 125 square metres (1,352 square feet) according to plans filed with New York authorities. Cape Advisors paid $78 million for the site in 2014, which currently is home to four warehouses and mixed-use building, in a neighborhood which has quickly become a centre for luxury development. The joint venture investment was brokered by Eastil Secured.
CSCEC Affiliate Builds $1B US Portfolio
CCA’s Ning Yuan (L) with Jersey City Mayor Steven Fulop and a Chinese consulate official at the Park and Shore ground breaking in October 2016
Strategic Capital is taking on its first New York project after the investment firm and its parent company China Construction America have made a series of US investments, including buying New York-based Plaza Construction in 2013.
The Chinese-owned American investment vehicle now says it has a US portfolio of more than $1 billion in projects, with its Manhattan debut signaling a new expansion of its North American foothold. “CCA is pleased to see Strategic Capital’s fast growth and expansion. We look forward to continuing our successful track records with this important Manhattan project,” said Ning Yuan, President of China Construction America.
A significant chunk of that expanding portfolio was acquired in 2013 when China Construction America spent $71 million in April that year to buy a suburban New Jersey office building. The company then bought a 1,000 unit residential site at 99 Hudson Street in New Jersey for $68 million in October 2013.
CCA and Strategic Capital expanded their New Jersey footprint in 2015 when Strategic Capital bought two more residential sites in Jersey City. The company broke ground on that project, the 358-unit, 37-storey condo development Park and Shore, last October.
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