Logistics real estate developer ESR Cayman, backed by private equity firm Warburg Pincus, has filed for a Hong Kong initial public offering of at least us$1 billion, two sources said, with one saying the size may be as much as US$1.5 billion. ESR joins a thinner pipeline of companies looking to go public in the Asian hub this year, after Hong Kong overtook all other venues in terms of IPO volume last year, with companies raising US$36.3 billion. But while 2018 was a bumper year in terms of listings, the post-listing performance was poor, with companies such as Xiaomi and Meituan Dianping – which both raised billions of dollars in their IPOs – still trading below their offer prices. Bankers expect investors to demand more reasonable valuations even as markets enjoy a rally, with the Hong Kong benchmark index up 11.5 per cent so far this year. One of the sources said the IPO of ESR would likely take place in the next one to two quarters. ESR declined to comment. The sources declined to be named as the information was not public. The company was valued at more than US$5 billion in its last funding round in May 2018, according to Reuters’ calculations based on public disclosures. ESR, the largest Asia-Pacific focused logistics real estate platform, was formed by a merger of Shanghai-based warehousing services firm e-Shang and Singaporean logistics real estate investment firm The Redwood Group in 2016. It develops and manages logistics facilities that cater to e-commerce companies, bricks-and-mortar retailers and manufacturers, according to the draft prospectus that was uploaded to the Hong Kong stock exchange website on Friday. ESR also manages a range of funds and investment vehicles that invest in logistics properties, the prospectus said. It made a profit of US$137.6 million on revenue of US$170.2 million in the first nine months of 2018, an increase of about 7 per cent year-on-year, according to the prospectus. Chinese online retailer JD.com Inc invested US$306 million in ESR in April last year through its logistics unit. ESR said that it would cooperate with JD.com in areas including property development, fund management and investment across the region. Warburg Pincus co-founded e-Shang in 2011 with two Chinese entrepreneurs and brought in investors such as APG Asset Management NV, CPPIB and Goldman Sachs. CLSA and Deutsche Bank are the IPO’s sponsors.