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Asia-Pacific-Based Investors in Opportunistic Private Equity Real Estate Funds

by Ee Fai Kam

  • 06 Jun 2012
  • RE

At present there are 95 Asia-Pacific-based investors that have a preference for opportunistic private real estate funds. These investors are mostly located in Australia (48%), while India, Japan and South Korea are each host to 11%. Unsurprisingly, Australia-based superannuation schemes make up 42% of Asia-Pacific investors in opportunistic private real estate funds, while asset managers and insurance companies each form 8% of the investor population. Banks and corporate investors each make up 7%. Overall, these 95 investors hold $5.2tn in assets under management (AUM). They allocate an aggregate of $133bn to the real estate asset class, of which $16.7bn is dedicated to private funds investments.

Following a merger with Westscheme Superannuation in 2011, AustralianSuper has become the largest superannuation scheme in Australia to invest in opportunistic private real estate funds. The $43bn investor has significant exposure to the real estate asset class, gaining access through private funds in addition to direct investments. It invests actively in a wide variety of strategies, including opportunistic, core and value added funds. In terms of geographical location, AustralianSuper invests on a global scale; however the bulk of its focus is on domestic vehicles.

Japanese institution Mitsubishi Corporation is also a significant participant in the real estate market. The trading company which belongs to one of Japan’s major conglomerates, Mitsubishi Group, has AUM of $150bn and a real estate allocation of 2.4%. The corporate investor has been building its real estate exposure through a mix of private funds, listed vehicles and direct investments. Besides investing in third party real estate funds, Mitsubishi Corporation also gains further access through its wholly-owned manager, Diamond Realty.

Another prominent Japanese investor is $2.9bn Osaka Gas Pension Fund, which provides retirement benefits to employees of the nation’s second largest gas supplier. The pension fund takes a diversified outlook in terms of strategy, and will consider most fund types including opportunistic, core, core-plus and debt vehicles.

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