Opportunistic Private Equity Real Estate Funds Investing in Asia-Pacific – December 2012

by Ee Fai Kam

  • 19 Dec 2012
  • RE

Currently, there are 45 opportunistic private equity real estate vehicles with an Asia-Pacific investment preference actively seeking capital. Collectively, these 45 funds are seeking nearly $22bn in aggregate capital commitments, making the average fundraising size approximately $500mn.

The largest of these vehicles is Brookfield Strategic Real Estate Partners, which has achieved a first close of $2.1bn, representing over half of its $3.5bn target. The opportunistic fund is interested in a diversified range of properties in Australia, as well as in Brazil, North America and Europe. The next largest opportunistic private equity real estate fund investing in Asia-Pacific is Starwood Distressed Opportunity Fund IX, which is seeking to raise an aggregate $2.5bn. The fund has successfully raised at least $1.2bn in capital commitments so far and will invest in the Indian market, as well as properties in Brazil, Europe and the US. Another private equity real estate fund employing an opportunistic strategy is Rockpoint Real Estate Fund IV. Managed by US-based Rockpoint Group, the vehicle has a target fund size of $2bn, and is interested in office, multi-family and hospitality assets in Japan, Europe and the US.

So far this year, 19 opportunistic private equity real estate funds which include Asia-Pacific as an investment focus have completed fundraising; these 19 vehicles have raised a total of $6.2bn in aggregate capital commitments. In 2011, 20 such funds held a final close and managed to secure $8.2bn in commitments from investors. Fundraising figures for opportunistic vehicles investing in Asia-Pacific have been on a general downtrend since 2008. At its peak, 45 such funds raised an aggregate of $45bn in 2008. Over the past four years (2008-2011), out of a total of 110 opportunistic vehicles with a preference for the Asia-Pacific region which have successfully held a final close, US-based funds formed the greatest proportion (33%), and raised $52bn in commitments. During the same time period, 16 headquartered in India raised $4.5bn, while 12 Hong Kong-based funds secured $3.7bn in commitments. The rest of the funds were based in countries such as Singapore, China, South Korea, the UK, Australia, Japan, Malaysia and Vietnam.

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