From Caijing Magazine:
Morgan Stanley is raising a property fund worth 10 billion yuan with aims to expand its share in China’s property market, according to a source closed to the U.S. investment bank.
On July 4, Crystal I Ltd., a unit of Morgan Stanley, bought 30 percent of a real estate project in Hainan Province from developer Agile Property Holdings Ltd. (HKSE: 03383). The final price tag for the deal was 5.28 billion.
Agile Property won the bid of the project in 2006 and planed to invest a total of 13 billion yuan in ten years’ construction. However, when capital began running low, Morgan Stanley got the chance to buy in.
“Developers will only invite a partners into a project when they face a financing bottleneck,” said one analyst. A report from Guotai & Junan Securities showed that Morgan Stanley paid an average of 1,800 yuan per square meter for its stake in Agile’s project, a sum that fall quit a bit short of the market price.