RRJ Capital to follow $3.5bn flagship fund with up to $1bn in real estate fundraise

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Asia PacificAsian private equity major RRJ Capital is reportedly ready to target up to $1bn for a real estate vehicle amid a bullish outlook on China’s economy.

RRJ co-founder Richard Ong told Reuters the firm would initially look to gather $500m for residential, retail, hospitality and elderly care home deals, but could double that target depending on demand.

Ong said the fund would aim to returns of between 25 and 30 per cent.

RRJ’s next fundraise comes at the end of a year it began by holding a $3.5bn final close for its second flagship fund.

That vehicle was the second-largest Asia-based private equity fund at the time, although fell short of its original $5bn target.

RRJ Capital Master Fund II picked up commitments from LPs including the New York State Common Retirement Fund and Texas County & District Retirement System.

In September global buyout giant TPG Capital invested $108.6m in Beijing-based real estate developer Xinyuan Real Estate.

TPG agreed to buy convertible notes worth $75.8m and $32.9m worth of shares.

Fellow large buyout players Blackstone Group and Carlyle Group have also completed Chinese real estate investment in recent months.

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