China Construction Bank will set up a RMB 30 billion ($4.2 billion) fund to buy properties from developers, as policy makers beef up efforts to contain a real estate crisis that’s weighing on the economy, reports Bloomberg.
The fund will “invest in existing assets” of real estate companies and renovate the properties into rental housing, the lender said in a statement to the Shanghai stock exchange Friday. The fund lasts for 10 years, with a possible extension, according to CCB, which is one of China’s big four state-owned lenders.
By establishing the fund, CCB “helps explore the new growth model of the real estate market and facilitates the stable and healthy development of the property sector,” it said in the statement. The country’s banking regulator has approved the investment in the fund, it added.