China Development Bank looks to finance US property project

China Development Bank is in talks to provide roughly US$1.7 billion to US property developer Lennar (LEN.NYSE) to finance two San Francisco housing developments, The Wall Street Journal reported, citing people familiar with the matter. Though the deal has not yet been closed, the Lennar projects seek to turn former San Francisco military bases Treasure Island and Hunters Point into mixed residential and commercial property developments. The projects are partially financed by the city and have been long delayed. The deal could also include China Railway Construction (601186.SH, 1186.HKG) in an advisory role or possibly as an investor in a US construction company involved in building the developments. Often Chinese banks provide funding to projects abroad on the condition that Chinese companies be involved, although San Francisco regulations generally require the use of local labor. If the deal proceeds, it could mark a turning point for US companies being more open to Chinese financing.