ING’s China Opportunity Fund II will make nine to 10 investments with an average deal size expected to be $50 million-$75 million. And an expected internal rate of return of 20%.
Dutch financial group ING’s real estate arm is launching a second China property fund, targeting to raise $500 million to $750 million as China’s home prices stabilise.
The China Opportunity Fund II will make nine to 10 investments with average deal sizes of $50 million to $75 million, mainly in residential development,
Richard van den Berg, China head of ING Real Estate and seen here, said, ‘If you go for very high returns, then you want to make use of distressed pricing, and clearly the U.S. and London offer opportunities that China does not. But if you want to invest in a growth market which is robust, and which has very strong underlying demand, then I think China offers very good opportunities and very attractive returns.’
The Guardian reports that ING had said in April it was reviewing its life insurance businesses in China and Japan as part of efforts to cut costs and improve its balance sheet. The firm was also in the process of cutting 900 jobs in the Asia-Pacific as part of plans to reduce headcount by 7,000 globally.
Van den Berg said, however, that the region was still a key part of its business strategy: ‘For our real estate strategy, China and Asia remain a very important part of our business, because basically, that is where the growth is coming from.’