REAL ESTATE – Dutch real estate group Kardan will invest $55m (€42.4m) has reported that its subsidiary GTC RE Real Estate will be developing a housing project in Shenyang, a city in the north of China.

This will be the fourth real estate project the fund is setting up in China, and its third already in Shenyang. According to analysts, the total investment will be around $55m(€42m). Total development costs of the project are set at US$ 250 million.

The Shenyang project will be developed by Kardan in cooperation with investment company Lucky Hope, the latter is investing around $125m. At present, the Chinese acreage is agricultural ground.

Kardan has also stated that the total investment portfolio of GTC China is currently set at 2.35m2, with a total investment of $ 650m.

Kardan has also stated that another real estate subsidiary, Kardan Real Estate, has acquired acreage in Tel Aviv, Israel, for around $20m. The latter acreage is a 5,000m2 plot in Tel Aviv on which Kardan will develop offices, shops and houses.

To obtain the total building rights, Kardan will have to pay another $16m as additional costs. At the end of January, Kardan stated that GTC Real Estate plans to target around $130m on the financial markets as non-convertible debt paper from Israeli institutional investors. At present, Kardan owns, directly and indirectly, 61.9% in GTC RE.

According to Standard & Poor’s in Israel, Ma’a lot, the debt paper will have an 'AA-' rating. The debt issue has been oversubscribed seven times. The bonds will have an interest of 4.9% and end in 2020. GTC RE has stated to use the money for expansion of its real estate portfolio.