Bain Capital ventures into China real estate(2)

Bain Capital has partnered CBL & Associates, a US mall developer and owner, to invest in a Chinese mall operator and real estate developer based in Nanjing.

Bain Capital has made its foray into China real estate via an initial $60 million investment for a minority stake in the Jinsheng Group, a mall operator and real estate developer based in Nanjing.

Bain has made the investment together with CBL & Associates, a US mall developer that has its headquarters in Tennessee. Bain’s share of the investment is $45 million, and CBL has the remainder, according to a statement. Both investors have also been granted a three-year warrant in the business for an additional combined $7.5 million investment, exercisable at the option of CBL and Bain Capital.

Jinsheng Group owns and operates two home décor shopping malls and two shopping centres in Nanjing, as well as two home décor shopping malls in Shanghai. The Nanjing-based company has several development projects underway.

Private equity investment in China’s real estate continues to be brisk from last year. Warbug Pincus recently agreed to buy a 25 percent stake in Shanghai ZK Real Estate Development Co, which is developing nearly 600,000 square meters of floor space in the second-tier cities of Anhui, Jiangsu and Jiangxi provinces, located in eastern China. As part of the deal, Warburg Pincus agreed to provide at least $30 million for housing projects by ZK Real Estate, according to Shanghai Daily, a local newspaper, which quoted Philip Mintz.