Albert Tan in PERE Magazine: Harbinger of RMB
Views are split as to whether Tishman Speyer's 'watershed' fundraising will precipitate a flurry of more international firms raising Chinese capital...
Albert Tan, partner at the law firm of Haynes and Boone, LLP, said that while other international fund managers have been keen to "tap the RMB fund market," there exist many reasons why they have remained predominantly faithful to traditional institutional sources of equity. "While I don't believe this is a one-off transaction, I also believe that this will not lead to an immediate flood or rush to raise RMB funds by international players," he added.
According to Tan, reasons including "general familiarity" with institutional capital, "the mechanics" of how it is deployed and the "certainty of responsiveness" to capital calls would keep most international fund managers favouring traditional equity sources. However, he added: "From a long-term perspective, once there are some precedents on successful methods to address the concerns, we will see more RMB-denominated real estate funds."
Excerpted from PERE Magazine, June 2012 issue. To view full article, click on the PDF link below.