Hong Kong-based real estate investment manager InfraRed NF has led the second round of mezzanine financing deal for property developer Fullsun International Holdings Group, it said in an announcement on Monday.
The latest funding to Fullsun International brings the total capital provided by the InfraRed NF consortium to $156 million. This February, the investment firm provided a $92.2 million mezzanine loan to Fullsun International.
The InfraRed NF consortium includes Singapore-listed Metro Holdings Limited, Global Gate Capital, as well as a global alternative investment management firm and a Chinese financial institution.
The Hong Kong-listed property developer will use the capital to acquire multiple projects as part of its strategy to accelerate the company’s growth.
The loan is secured on a portfolio of three ring-fenced projects comprising two residential mixed-use projects in Changsha and a residential project in Zhongshan, with additional credit enhancement provided from an office asset in Hong Kong. The existing portfolio has generated contractual sales of about $150 million since January.
“Focusing on cities with attractive demographic growth, strong affordability and infrastructure improvement help to provide natural downside protection. With our latest investment in the Greater Bay Area, our portfolio companies are now present in four mega hubs,” said InfraRed NF head of special situations financing Grant Chien.
To date, InfraRed NF has completed 11 credit investments in excess of $650 million of capital in Greater China, seven of which have been exited.
According to the investment firm, this new loan is a continuation of InfraRed NF’s investment strategy to concentrate its lending activity on projects in mega hubs, which benefit from higher than national average GDP per capita, population growth rates, and infrastructure investment.
“China’s long-term deleveraging continues to create compelling risk-adjusted returns for us in both the value-add and mezzanine space. This transaction provides further evidence of our leadership position in structuring private credit in Greater China,” said InfraRed NF CEO Stuart Jackson.
Established in 2007, InfraRed NF – a joint venture between InfraRed Capital Partners and Vervain, claims to have a proven track record of delivering superior returns through a combination of mezzanine financing and value-add investing. It has invested over $1.75 billion across 23 transactions in Greater China.
InfraRed Capital Partners is a global investment manager focused on infrastructure and real estate with offices in London, Hong Kong, New York, Seoul, and Sydney. It has launched 18 funds including two listed companies on the London Stock Exchange manages $12 billion of equity in multiple private and listed funds, primarily for institutional investors across the globe.
Vervain, which includes entities operating under the former name of ‘Nan Fung China’, is a private company established in 2004 and based in Hong Kong. It has a diversified real estate business, including property investment, property development, project management, and real estate private equity investments.