Recently, attorneys Shang Haodong, Sun Bo and Fu Xingli from Dacheng’s Shanghai office advised a real estate fund management company owned by Gemdale Corporation on the formation, funding and investment of an RMB400mln real estate fund. The fund, which is oversubscribed, has currently completed fundraising.

 

Gemdale Corporation is one of the four leading real estate developers in China (the others being China Merchants Property Group, Poly Real Estate Group and China Vanke) with a focus on residential and commercial real estate development and finance.  Pioneering real estate fund among China’s property developers, Gemdale has cooperated with United Bank of Switzerland (“UBS”) and set up an independent fund management company to explore China’s real estate fund market.

 

The fund in question is the first real estate mezzanine fund formed by Gemdale Corporation. As a directed and structured financial product, it involves the ranking of investors in terms of repayment priority, the use of a trust company in a special limited partnership, formation of a buyout fund, comparison of ways of capital increase in reference to tax, such as entrusted loans and other marketized means of financing.

 

The Shanghai team led by attorney Shang Haodong was engaged by the fund management company to advise it on the fund’s formation, funding and investment. The team offeredd comprehensive, detailed and targeted legal advise for its client, ranging from structure design for the fund, due diligence for real estate project companies and their parent companies, formation and fundraising of the fund to preparation of documents related to the structured financing, real right-based and credit’s right-based guarantee arrangement, connected transactions and information disclosure of public companies and design of the buyout fund. The attorneys’ detail-orientedness and creativity in problem solving was highly recognized by the client, who expressed willingness for further cooperation.