Developer Great Eagle in deal for US office fund
Great Eagle said a subsidiary has reached an agreement with asset manager China Orient to establish a limited partnership closed-end fund to invest in grade A office buildings in major cities in the United States.
"As the US economy continues to improve, demand from corporate occupiers has bolstered improvements in the rents of some office markets," Great Eagle said in a statement to the Hong Kong stock exchange advising of its plans for the US Real Estate Fund.
"The strategy of the [fund] is to acquire office properties in select cities which the company believes will benefit from positive demand drivers," the filing said.
GE is the wholly owned subsidiary of Great Eagle that will work with China Orient to incorporate the US Fund General Partner, as well as the China Fund General Partner.
After the US Fund General Partner is established, the two parties would establish the limited partnership closed-end fund, Great Eagle said.
The China Investment Fund, which is also a limited partnership closed-end fund, will be formed by the same parties to provide financing to real estate companies on the mainland and developers with a primary listing in Hong Kong.
China Orient is a wholly owned unit of state-backed China Orient Asset Management Corp.
Great Eagle said total capital in the form of cash and properties injected in the venture would be about US$230 million for the US fund and US$110 million for the China fund.
It would finance the cash portion by internal financial resources, the company said.
It said the US partner would be owned 80 per cent by GE and 20 per cent by China Orient. The China partner would be owned by an intermediary holding company held 80 per cent by China Orient and 20 per cent by GE.