* KKR investment gives Sino-Ocean stable financing in tight
* Fund to invest in mid- to high-end residential property
* KKR and Sino-Ocean to invest $70 mln each
By Stephen Aldred
HONG KONG, Sept 5 U.S. private equity firm
Kohlberg Kravis Roberts and Chinese property firm
Sino-Ocean Holdings have established a $140 million
fund to invest in China real estate, the companies said.
KKR's investment in the five-year fund provides a long-term
stable source of financing for Sino-Ocean, as property
developers face a tighter credit environment in China brought on
by government concerns about overheating.
Sino-Ocean and KKR will use the fund, Sino Prosperity Real
Estate Fund L.P., to invest in mid- to high-end residential
developments, but can invest in other projects throughout China
through outright ownership, joint ventures or M&A.
Sino-Ocean and KKR have each agreed to make a capital
commitment of $70 million to the fund, they said.
The fund will make its first investment in Great Wise
Investment, a Sino Ocean project in Dalian. The project is
developing middle-income residential apartments which will sell
for around $150,000 to $200,000, according to a source familiar
with the matter.
Sino-Ocean is investing in the fund through its subsidiary
Gemini Investments Holdings and KKR is investing through its $1
billion KKR China Growth Fund L.P.
The source declined to be named because he was not
authorised to speak to the media.
(Editing by Helen Massy-Beresford)