SINGAPORE – Keppel Corporation has raised a 1.4 billion yuan (S$262.8 million) initial investment from an undisclosed global institutional investor, capturing opportunities in China’s sustainability transition.
Together with 160 million yuan of a sponsor stake by Keppel, the total 1.6 billion fund (S$306 million) marked the closing of its China-focused sustainable urban renewal programme, said the company on Thursday.
About 3.9 billion yuan worth of assets are expected to be under Keppel’s management “when fully leveraged and invested”. Both parties also have an option to upsize their commitments in the programme.
Keppel has been further implementing its sustainable urban renewal strategy across real estate markets in countries such as India, Japan and Australia since the launch of its Sustainable Urban Renewal Fund in 2022.
The fund focuses on retrofitting and repurposing existing buildings, with a target size of US$2 billion.
Under the sustainable urban renewal strategy, Keppel has been integrating resources to rejuvenate aged buildings to provide “greener, less costly and fast-to-market solutions compared to redevelopment”, noted Louis Lim, chief executive of real estate at Keppel.
Mr Lim also said the move illustrates how Keppel is well-positioned to seize opportunities during China’s transitioning towards high-quality, low-carbon growth.
The closing of fundraising for its China market under the fund is not expected to have a material impact on Keppel’s earnings per share and net tangible assets per share for the current financial year, the company said.
Christina Tan, chief executive of fund management and chief investment officer of Keppel, highlighted that the China-focused programme closing with the 1.6 billion yuan investment signifies Keppel’s capabilities to create targeted portfolios that global investors seek.
Lim added that Keppel will continue to drive energy costs down, as well as enhance tenant experiences and asset valuations by 10 per cent to 15 per cent via the private funds.
In March this year, Keppel disclosed its new target to increase assets under management to S$200 billion by 2030, particularly through three new funds: Keppel Core Infrastructure Fund, Keppel Asia Infrastructure Fund II and Sustainable Urban Renewal Fund.
Shares of Keppel, which is due to announce its third-quarter business update after the stock market closes on Thursday, were trading down four cents, or 0.6 per cent, at $6.28 as at 9.32am. THE BUSINESS TIMES
https://www.straitstimes.com/business/keppel-snags-306-million-for-china-focused-sustainable-urban-renewal-fund
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