Chinese firm puts $3b into rebuild
Christchurch’s rebuild will get a massive capital injection thanks to a Chinese company creating a $3 billion investment fund for city projects.
Guoxin International Development Company, part of a global firm worth about $500b, said on Wednesday it was committing to raise a $3b fund for investment opportunities in the city’s postquake rebuild and regeneration.
The company was behind the main stadium for the Beijing 2008 Olympic Games and has constructed railways across China.
Local developer Fred Rahme, who is behind the Silverstream residential subdivision in Kaiapoi and Styx Mill Estate, is leading the company in Christchurch. Rahme, a Guoxin founding partner, said several Christchurch projects had already been identified, but he would not name them.
Once projects went out for tender, Guoxin would submit bids for them.
‘‘We’ve established we do have a part to play and we can really add value. Where else in the world do you have an opportunity to build a new city?’’
Because of the company’s size, it could source materials from China and across the world at a cheaper cost, which could make projects more viable, Rahme said.
Guoxin, the largest tendering and procurement company in China, has completed $750b of projects, mostly governmental and infrastructure developments, in the past 16 years.
Christchurch Mayor Lianne Dalziel signed a Letter of Cooperation and Friendship between the city council and Guoxin International on Tuesday. The letter is a non-binding agreement, and does not impose any legal or financial obligations or liabilities on the council or Guoxin.
Guoxin has also signed agreements this week with the Christchurch City Council, Canterbury Employers’ Chamber of Commerce, business advisory firm PwC, ANZ bank and law firm Cavell Leitch.
Dalziel said the move was a generous commitment from a large, reputable Chinese company.
Guoxin was confident it could win in an open tender process, she said. ‘‘I’m excited that our community will have the chance to work alongside this company as we shift our focus from recovery to regeneration.’’
Christchurch City Councillor Raf Manji said securing foreign capital had been a challenge for Christchurch.
‘‘There has been a lot of interest. We’ve had lots of visits over the previous years and we’ve not been able to execute, but we haven’t had the right platforms for investors.’’
The fund would set up a template for investment, Manji said.
‘‘The council’s role is at the political level, which is to roll out the welcome mat and say ‘Christchurch is open for business’.’’
Manji said the Guoxin deal was not exclusive. He hoped it would set the foundation for other investors.
‘‘The council is not responsible for the whole rebuild of the whole city. Our job is to make sure it can happen and we enable investors to come in and do what they need to do.’’
He named the stadium as an example of a project Guoxin might like.
‘‘It’s those type of larger scale projects that would be of interest.’’
Canterbury Employers’ Chamber of Commerce general manager Leeann Watson said Guoxin was making a significant commitment and the company’s willingness to work with Christchurch people was welcomed.