Sunsea Parking Industry Group Inc said on Tuesday that it has raised 1.5 billion yuan ($227 million) in financing to further expand its services in China and gain an edge in China's emerging car parking industry.

The current round of funding was led by US-based investment company Warburg Pincus. Other backer include Red Star Macalline Group, a leading domestic company for household items and a portfolio company of Warburg Pincus. Red Star Macalline said it will consider granting the operational rights for its parking lots in its over 200 furniture and shopping malls to Sunsea Parking in the future.

Sunsea Parking said it would spend at least 1 billion yuan to set up more parking lots within the next 12 months.

"Parking assets will become the next most attractive real estate asset class because it generates steady cash revenue with potential of further financing options such as real estate investment trusts," said Yan Liang, chairman of Sunsea Parking.

Founded in 2006, Sunsea Parking is dedicated to providing services for the entire value chain of parking management, including urban parking, parking lot planning and design, intelligent parking business, operation, investment and construction.

"Private car ownership in China has been growing at over 10 percent per year and China is now the largest automobile market in the world, but the amount of parking spaces has simply not kept up," said Joseph Gagnon, managing director and head of real estate in Asia for Warburg Pincus.

Gagnon added that due to the supply imbalance of parking spaces, it is an opportune time to partner with China's leading car park operator.

A report released on Tuesday by market consultancy Bain & Co showed that China's car ownership had reached 190 million in 2016 with an 11 percent increase over the previous year, only second to the United States. And the number is expected to surge by 8 percent year-on-year to 280 million by 2021.

Bain noted that the conflict between the lack of parking lots and the growing number of cars has become a severe problem in China, which also opens up new opportunities for the parking industry.

According to the report, the domestic parking market in China has reached a scale of 420 billion yuan last year, and is set to reach more than 1 trillion yuan by 2021.