Century Bridge Invests $60 Million Equity in Two China Residential Developments

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Projects Totaling $282 Million to Include 2,500 Residential Units

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May 19, 2014, 08:02 ET

BEIJING and DALLAS, May 19, 2014 /PRNewswire/ -- Century Bridge Capital announced today that it has invested $60 million in two joint venture real estate developments for middle-income, residential projects in Zhongshan and Wuxi, China.

Century Bridge Wuxi Residential Development - One of Two China Tier 2 City Residential Developments Totaling $282 Million to Include 2500 Residential Units (PRNewsFoto/Century Bridge Capital) (PRNewsFoto/Century Bridge Capital)

Commenting on the investments Century Bridge CEO, Tom Delatour, noted, "The two investments are consistent with our established strategy and reflect the characteristics we believe are essential for successful joint venture residential developments in Tier 2 and 3 cities in China. Both are in-fill sites located in vibrant submarkets within cities experiencing dynamic economic expansion. Like all the markets we target, they are also experiencing increasing levels of affordability, with annual disposable income growth exceeding home price growth. In addition to benefiting from adjacent infrastructure and accessible amenities, the projects themselves are designed to meet the needs of middle class buyers in these areas. As is the case with the underwriting of urban real estate developments globally, where market conditions vary from region to region, country to country, city to city and submarket to submarket within individual cities, understanding and documenting the trends, local economics and purchaser profiles on a submarket basis is critical. Both the Zhongshan and Wuxi investments are based on a rigorous assessment of these factors."

Wuxi East Station Project

Wuxi – Major city at forefront of China's transition to higher value-added production and manufacturing. Foreign companies include General Electric, Bosch and Siemens.
Established In-fill Location – In Xidong New City, a growing neighborhood of 150,000 residents, in the Xishan Industrial District of Wuxi, adjacent to the Wuxi East High-Speed Train Station with close proximity to educational resources, retail amenities, local subway transportation as well as hospital facilities.
Personal Income Growth – Wuxi has one of the highest GDP per capita in China and personal incomes have grown approximately 11.6% every year in the past five years compared with residential price growth of 6.5%.
Joint Venture Partner – The project is being developed by a joint venture of Century Bridge and Jingrui Holdings.
Development – The $220 million project includes above ground gross buildable area of 2,004,149 square feet (186,190 square meters) on a site of 1,113,427 square feet (103,439 square meters).
Residential – Will comprise approximately 175,090 square meters/1,884,668 square feet (1,714 units).

Zhongshan Ouya Project

Zhongshan – Major commercial and industrial city economically linked with other area cities including Foshan, Macau, Hong Kong, Zhuhai, Shenzen and Guangzhou.
Established In-fill Location – Downtown location in Shiqi County, Zhongshan's historic city center. Close proximity to major transportation arteries, retail shopping, established schools and hospitals. Highly-mature residential area ideally suited for both entry-level buyers as well as upgrade homebuyers.
Personal Income Growth – Zhongshan has posted some of the lowest price-to income ratios for the last five years. Per capita income growth in excess of 9% has outpaced price growth of 5.5% on an annualized basis.
Joint Venture Partner – The project is being developed by a joint venture of Century Bridge and Dongfu Real Estate Development.
Development – The $62 million project includes above ground gross buildable area of 641,534 square feet (59,600 square meters) on a site of 160,814 square feet (14,940 square meters).
Residential – Will comprise approximately 51,450 square meters/553,808 square feet (813 units).

Century Bridge President, Wei Deng, commented, "The growth strategy and investment philosophy of our partners on these two transactions is very much in line with that of Century Bridge. Jingrui Holdings, apart from developing in Shanghai, has primarily focused on projects in Tier 2 and 3 cities. As a Hong-Kong listed national developer with more than 20 years experience, their history of success and level of expertise in these markets makes them an ideal partner for us."

Wei Deng added, "Dongfu Real Estate Development Company is a local developer with a long track record of developing projects solely within the city of Zhongshan. Its core group of real estate professionals have deep roots in the city and have demonstrated success with a variety of projects in the local market."

With 100 million people expected to relocate to China's cities by 2020, China's ongoing urbanization and infrastructure needs will continue to drive growth in the Tier 2 and 3 cities. Century Bridge Capital believes that this dynamic bodes well for continuing stability and investment opportunity in middle-class housing in solid submarkets within China's Tier 2 and 3 cities.

Century Bridge Capital is a private equity firm with offices in Beijing, China and Dallas, Texas. The firm is focused exclusively on investment in the middle-income, residential real estate sector in China's growing Tier 2 and 3 cities. Its China-focused private equity real estate fund, Century Bridge China Real Estate Fund, L.P., has over $170 million of total committed capital from ten global institutions.

www.centurybridge.com