Alpha Investment Partners (Alpha), the private fund management arm of Singapore-based Keppel Capital, has partnered with Allianz Real Estate to acquire majority interest in a Grade A office complex in Beijing for S$1.3 billion ($948 million).
In a disclosure to the Singapore Exchange on Wednesday, Keppel said Alpha and Allianz will jointly acquire an 85-per cent interest in Ronsin Technology Center, a S$1.5-billion ($1.1 billion) Grade A office complex in the Wangjing sub-district in Beijing.
The Alpha-Allianz joint venture will acquire the stake from D&J China, a Warburg Pincus-founded business park and suburban office space operator. D&J will hold the remaining 15-per cent interest in the complex.
The property will be managed by Alpha, Allianz, and D&J China when the acquisition is completed in the fourth quarter of 2019.
Completed in March 2018, Ronsin Technology Center comprises six office towers and a retail podium. The property, located above the Laiguangying subway station in Beijing’s Wangjing sub-district, has a total net leasable area of approximately 131,000 square meters. It has an occupancy rate of 70 per cent.
Alpha will hold a 38-per cent stake while Allianz will take 62 per cent in the joint venture company that will acquire the 85-per cent interest in the property. Alpha will finance the investment through its funds under management, including the Alpha Asia Macro Trends Fund III (AAMTF III).
AAMTF III, including co-investments, closed at $1.1 billion in January, exceeding its initial target. The fund is the third value-add pan-Asian fund in the Alpha Asia Macro Trends series, which was launched in 2007 with the target of investing in multi-asset classes across key gateway cities in the region.
Allianz is also an investor in AAMTF III.
In September 2018, the fund partnered with Allianz Real Estate along with another undisclosed investor to acquire a building in Shanghai’s Bay Valley Business Park from CITIC Capital at investment consideration of approximately $48 million.
The acquisition of Ronsin Technology Center will be AAMTF III’s first investment in Beijing and follows the fund’s and Keppel Land China’s acquisition of Yi Fang Tower in Shanghai earlier this year, according to Keppel Capital CEO Christina Tan.
For Allianz Real Estate, the acquisition is a continuation of its investment strategy to allocate 50-60 per cent of its Asia Pacific real estate exposure to fast-growing markets such as China and India, according to Rushabh Desai, the firm’s Asia-Pacific CEO.