Canada's Brookfield eyeing US$2b property deal in Shanghai

Shanghai

BROOKFIELD Asset Management is planning to buy a commercial property site in Shanghai for around US$2 billion, according to people familiar with the matter.

Brookfield Strategic Real Estate Partners III is considering buying three office towers and a retail mall at Greenland Huangpu Centre from a unit of Greenland Hong Kong Holdings, the people said, asking not to be identified because the details are not public.

A transaction of that size would rank among the biggest commercial property deals in China by a foreign firm.

Singapore's CapitaLand and GIC Pte spent 12.8 billion yuan (S$2.58 billion) last November for Shanghai's tallest twin towers, located along the city's North Bund. That was Shanghai's largest commercial property deal involving a foreign investor, according to CBRE Group.

Greenland Hong Kong's stock has been halted since Monday pending a "notifiable transaction".

Separately, Brookfield is in talks with banks for a loan of as much as US$1 billion to back its planned purchase, three of the people said. The financing would include both onshore and offshore tranches, they said.

The Canadian alternative asset manager in January announced the closing of Brookfield Strategic Real Estate Partners III, its latest flagship global private real estate fund. BSREP III is Brookfield's largest private fund to date with total equity commitments of US$15 billion.

The foray wouldn't be Brookfield's first in China. In 2013, the group agreed to invest US$500 million in Shui On Land's Xintiandi entertainment complex unit in Shanghai. Last year, it partnered Singapore-based warehouse operator GLP to develop rooftop solar projects in China, and purchased two retail malls in Shanghai for US$285 million. BLOOMBERG