Investment Opportunities in Asia-Pacific-Focused Private Real Estate Funds – July 2015

by Joyce Chee

  • 08 Jul 2015
  • RE

Preqin’s Real Estate Online service currently tracks 68 private closed-end real estate funds in market targeting assets located in the Asia-Pacific region; these funds are looking to secure $19bn in aggregate capital commitments. Nearly half (49%) of these funds on the road have held an interim close, and since the start of 2015, $4.7bn of institutional capital has been raised across 15 private funds.

Opportunistic vehicles account for the largest proportion of Asia-Pacific-focused funds in market (41%), followed by value added funds (22%) and debt vehicles (13%). Funds that utilize core or core-plus strategies each constitute 12% of the fund pool. Additionally, 29% of funds targeting the Asia-Pacific market are being raised by first-time fund managers.

India is the primary investment destination for 37% of Asia-Pacific-focused funds on the road. Interestingly, all vehicles targeting India are country-specific funds. Twenty-two percent of vehicles are targeting Australian assets, while China is targeted by 22% of funds, followed by Japan (21%) and Hong Kong (12%). Of the funds on the road, a noteworthy 78% (or 53 funds) are country-specific vehicles.

There are five Asia-Pacific-focused private real estate funds in market with a target size of $1bn. One of the largest real estate funds in market is Aetos Capital Asia V, which targets debt, distressed, opportunistic and value added office, mixed-use, residential and retail assets in Japan, Hong Kong, China and South Korea. This is the fifth Asia-focused fund raised by US-based Aetos Capital Real Estate.

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