China Investment Corp (CIC), the country's sovereign wealth fund, is in talks with Harvard University's endowment to buy the US institution's stakes in property funds worth about $500 million, the Wall Street Journal reported on Wednesday.
The latest move by the $300 billion sovereign wealth fund reflects its efforts to tap properties in the distressed US commercial real estate sector as it seeks to diversify its overseas portfolio.
Terms were still being negotiated and any transactions could be finalized over the next few months, the newspaper quoted sources as saying.
Harvard's property portfolio made a loss of over 50 percent in the year that ended June 2009, the paper said, quoting a performance report by Harvard Management, which oversees the endowment.
The $26 billion Harvard endowment has been trying to pare down its $5.4 billion real-estate portfolio as it attempts to reduce its exposure to illiquid assets, the paper said.
Harvard Management Company and CIC were not immediately available for comment.
