November 22, 2011 / 9:46 AM / 9 years ago

Shenzhen property startup targets $236 mln funds

HONG KONG, Nov 22 (Reuters) - PTiFund, a Shenzhen-based private equity startup backed by Hong Kong-listed developer Top Spring International Holdings Ltd, said it has closed the first round of financing on its debut fund, a 500 million yuan ($79 million) product.

The company raised 25 percent of the total with the first close, which took place on Monday.

“We are still working towards year-end with our distribution partner and before mid-December hope to have the final close, at half a billion yuan,” said Chief Investment Officer Payne Fung.

He added that PTiFund had three funds in the pipeline looking to raise 1.5 billion yuan ($236 million). The second and third funds were each of a similar size, with the second fund due to launch later this month.

The first fund, Tianjin PTiFund Limited Partnership, will invest in a residential property project in Shenzhen. The fund is being promoted and distributed by one of China’s state-owned banks to wealthy customers.

The second and third funds are also project-specific, raising money for a mixed-use development in Guangdong Province near Guangzhou, and for a mixed-use project in the Yangtze River Delta.

Chinese real estate funds raised $2 billion in the third quarter, up 60 percent from the previous three months, according to consultancy Zero2IPO. They are filling a gap as developers suffer from lending curbs and stagnant sales in China.

CITIC Capital Holdings said last week that it had closed the first round of financing on its $600 million retail fund, its fourth real-estate fund in mainland China.

Property developers in China are also shifting their attention away from purely residential developments as the home market in China slows. Official data showed on Friday that average home prices moved lower for the first time this year.

Policymakers in China are attempting to pull off a tough balancing act. They want to rein in runaway home values and demonstrate that they are committed to affordable housing. But buyers who have recently purchased homes have demonstrated in cities such as Shanghai and Beijing, with some protests turning violent. ($1 = 6.3600 yuan) (Additional reporting by Samuel Shen and Langi Chiang; Editing by Chris Lewis)

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