ESR, GIC setting up US$500m JV to invest in China logistics real estate

LOGISTICS real estate developer ESR Cayman is establishing a US$500 million joint venture with Singapore sovereign wealth fund GIC, to develop institutional-grade logistics facilities in key cities across China.

The transaction is subject to the relevant regulatory approval, said ESR in a media statement on Monday.

In China, the total gross floor area of ESR's portfolio assets comprised 6.62 million square metres, with its total assets under management surpassing US$4.39 billion as at June 30, 2019.

This is the second partnership between GIC and ESR, following their previous tie-up in Japan, the company added.

Jeffrey Shen, co-founder and co-chief executive officer of ESR, noted that as the world's largest e-commerce market, demand for logistics properties will continue to thrive in China.

Infrastructure such as modern warehousing will be a "backbone of the new economy", serving the online and offline needs of retail businesses, added Mr Shen.

Hong Kong listed ESR Cayman is the sponsor of mainboard-listed ESR Reit.

Last December, Bloomberg reported that the Warburg-Pincus backed company is mulling over an initial public offering consisting of its South Korean assets, that could take place as soon as this year.

As at 2.44pm on Monday, units in ESR-Reit were trading flat at S$0.545.