Ivanhoé Cambridge and APG lead close to US$920M capital raise in Chongbang to further its expansion in Shanghai

Canadian real estate company Ivanhoé Cambridge and Dutch pension asset manager APG Asset Management N.V. announce that they have taken significant participation in Chongbang via an approx. US$920 million capital raising.

Chongbang is a Shanghai-based retail-anchored mixed use developer, owner and operator. This is the second institutional capital raising for Chongbang. Singapore’s sovereign wealth fund, GIC, is an existing shareholder of Chongbang. Chongbang presently owns and operates 428,000 m² (4,6 million ft²) of retail and commercial space in Shanghai with another 417,000 m² (4,5 million ft²) under development.

Chongbang was founded in 2003 by a group of Singaporean and Hong Kong investors, led by Henry Cheng and Stephen Wong. Mr. Cheng is an ex-Shui On Group executive widely credited with Shui On Properties' growth in Shanghai, inclusive of the iconic Xintiandi project, which has become a benchmark for lifestyle- based retail developments in China. Chongbang’s management team continues to be headed by Mr. Cheng and the company now employs close to 400 people across its main functions. Mr. Wong continues to be the Chairman of the Chongbang group providing strategic oversight.

“Chongbang exemplifies Ivanhoé Cambridge’s growth strategy of building strategic alliances with prominent real estate companies that are proven industry leaders,” said Rita-Rose Gagné, Executive Vice President, Growth Markets, for Ivanhoé Cambridge. “We are enthusiastic about teaming up with other experienced institutional shareholders to ensure Chongbang’s continued growth and future success. Chongbang’s team has an outstanding track record and a compelling long-term vision. They are known for solid execution in creating and managing mixed-use, retail-focused projects. Now, they are better positioned than ever to respond to evolving consumer preferences and to new technologies that are reshaping the customer experience.”

She continued: “This investment represents a milestone in the execution of our Company’s strategy of significantly increasing our allocation in key growth markets, where China is an important pillar. We look forward to working with Chongbang with a view to increasing our investments in select, large-scale real estate projects in the Shanghai region.”

Sachin Doshi, Managing Director and Head of Private Real estate Investments, Asia-Pacific at APG, said “The investment in Chongbang builds on APG’s strategy to increasingly participate in city-specific platforms in key gateway urban centres around the world, in sectors with compelling long term fundamentals and through partnering with management teams with unparalleled execution capability in their local markets. It also demonstrates APG’s deep commitment to China and the Asia-Pacific region and follows our US$650 million commitment to Shanghai-based logistics developer e-Shang in 2014.”

"Rapid urbanisation, growing disposable incomes and continued rebalancing towards domestic consumption are recurring themes in China and we believe Shanghai, more than any other city in the PRC will lead this consumption story. We like Chongbang's deep understanding of consumer preferences in their catchments and the strong lifestyle themed retail complexes they have built and operated successfully under the Life Hub brand" he added.

"Chongbang sees enormous growth opportunities in the retail-anchored mixed-use sector in Shanghai and its neighbouring cities, both in terms of development of new projects and enhancement of old ones, as the region steps up its urban regeneration programmes. APG and Ivanhoé Cambridge's participation will further strengthen Chongbang's ability to capture these opportunities," said Chongbang’s CEO, Henry Cheng.

Chongbang has identified several development opportunities in core retail precincts in Shanghai as use of proceeds from this capital raising. With an enviable register of long term institutional shareholders, Chongbang aims to more than double its portfolio of Life Hubs over the next few years to consolidate its position as a landlord of choice for top retail and lifestyle tenants in Shanghai and its surrounds.

“This is an exciting time for us at Chongbang. We are honoured to have Ivanhoé Cambridge and APG to share our long term vision. The combination of global perspective and long term vision will further strengthen our foundation for our next round of growth. Together with our existing partners GIC and the Edward Wong Group, all of us at Chongbang are committed to remain focused in the creation of more innovative and sustainable Life Hubs in Shanghai and the Yangtze River Delta”, said Chongbang’s Chairman Stephen Wong.

About Ivanhoé Cambridge

Ivanhoé Cambridge leverages its broad expertise, investing in, operating and developing real estate properties and companies to deliver optimal returns for its investors. Through multiple subsidiaries and partnerships, Ivanhoé Cambridge holds assets located mainly in Canada, the United States, Europe, Brazil, Mexico, China and Australia, which totalled more than Cdn$42 billion as at December 31, 2014. Ivanhoé Cambridge is a real estate subsidiary of the Caisse de dépôt et placement du Québec (cdpq.com) one of Canada's leading institutional fund managers which held, as at December 31, 2014, $225.9 billion in net assets. For further information: ivanhoecambridge.com.

About APG Asset Management N.V.

APG Asset Management N.V. is a Dutch pension fund asset manager in the Netherlands. For its pension fund clients and their 4.5 million active and retired participants from the public and private sectors representing over 30% of all collective pension schemes in the Netherlands, APG Asset Management N.V. manages pension assets of more than €430 billion as at the end of April 2015. For further information: www.apg.nl/en.

About Chongbang

Since its inception in 2003, Chongbang has embarked on the investment and development of seven retail-anchored mixed-use projects in Shanghai, Hangzhou and Kunshan, and has completed the Life Hub @ Daning, Life Hub @ Jinqiao, Sinan Mansions and Life Hub @ Anting in Shanghai.