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A man passes a Capitaland logo outside an office building in the central business district in Singapore January 22, 2016 Reuters

Singapore property giant CapitaLand has set up a $2 billion (US$1.5 billion) private investment vehicle in China that will invest in prime integrated developments China's major cities.

The investment vehicle, its third in China known as Raffles City China Investment Partners III, will be the largest private capital-raising by CapitaLand so far.

"Following our successful partnership with Qatar Investment Authority in the serviced residence sector, RCCIP III is set to be another excellent example of how we are proactively working with strong capital partners to build up scale, while enhancing the group's returns on equity through earning fee income," CapitaLand president and group CEO Lim Ming Yan said, according to the Business Times.

The new venture will help Singapore's' largest developer reach the target of S$10 billion in investments by 2020, the company said.

CapitaLand will have a 41.7 percent stake in the vehicle while investors from Asia, North America and the Middle East will hold the remaining stake. One of the bigger investors would be Canada Pension Plan Investment Board, which is committing $375 million in the China property fund.

"Investing in CapitaLand's new China investment vehicle gives CPPIB the opportunity to expand on our long-term strategy of investing in high-quality commercial real estate in China to deliver solid risk-adjusted returns over the long term," Jimmy Phua, managing director and head of real estate investments for Asia, said in a statement.