[photopress:Howard_Johnson_Ginwa_Plaza_Hotel_Xi_an_0.jpg,full,alignright]Citigroup’s property investment arm plans to invest in a hotel owned by China’s Ginwa Enterprise, part of the U.S. investment bank’s program to acquire shopping malls and hotels in China’s major cities.
Citigroup will soon sign an agreement with Ginwa to invest in its five-star Howard Johnson Ginwa Plaza Hotel, in the northwestern city of Xian. It did not say how big a stake Citigroup was buying or for how much.
In February, Citigroup raised $1.29 billion in its Asia opportunities fund and plans to invest $600 million of the fund in China and $400 million in India.
David Schaefer, Asia head of Citigroup’s property investment arm, said in April that the Citigroup fund had already made three investments in Shanghai, including buying a 75% stake in the Novel Plaza office building, but was looking at up-and-coming second-tier cities including Xian and Chengdu in the west, as well Tianjin, which neighbours Beijing.
The Chinese government last year imposed restrictions on foreign investment to curb overseas speculation and a surge in domestic property prices.