LaSalle mops up $1.1b for fifth Asia Opportunity fund, exceeds target

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Real estate investment manager LaSalle Investment Management has closed its LaSalle Asia Opportunity V fund at over $1.1 billion, exceeding the $750-million target announced at the launch of the vehicle in August 2016.

The fifth in LaSalle’s series of closed-end, pan-Asia opportunistic funds, the vehicle has secured total commitments of $1.15 billion, of which 85 per cent is assigned to the fund and 15 per cent is targeted for co-investments, LaSalle said in an announcement on Monday.

The total capital was secured from 20 external institutional investors from Asia, Europe, the Middle East, and the US, the realty investor said.

The fund follows the same strategy as its predecessor, and seeks to take advantage of mis-priced assets with opportunities to add value via re-positioning and redevelopment in target markets including Australia, China, Hong Kong, Japan, Korea and Singapore. The capital raised will provide buying power for approximately $3.3 billion worth of assets.

Moreover, the fund has invested approximately 37 per cent of committed capital so far and has a diversified portfolio of investments in major Asia cities such as Tokyo, Osaka, Nagoya, Singapore, Shanghai, Hangzhou, across multiple sectors, office, retail, hotel/service apartment and logistics.

The size of the latest vehicle is, however, significantly larger than the predecessor fund, LaSalle Asia Opportunity IV, that had committed $585 million to a similar strategy and is expected to outperform its target net return of 18 per cent. As of first quarter of this year, the fund IV has returned 89 per cent of the equity deployed and, since inception, the Fund’s returns are 39.1 per cent IRR and 1.61x EM, LaSalle disclosed.

“Investors are drawn to this region for its healthy market fundamentals, risk-return diversification opportunities afforded by varying market cycles, and the rising demand for core assets,” said Mark Gabbay, Chief Executive Officer and Chief Investment Officer – Asia Pacific, LaSalle.

The demand the investor’s opportunistic fund product for Asia received highlights the region’s emergence as one of the most attractive destinations for real estate investors globally. In fact, LaSalle has invested an aggregate of approximately $11 billion on behalf of the LaSalle Asia Opportunity Series in over 150 investments and currently has a platform of 162 people in the Asia Pacific region, with offices in the fund’s six target markets.

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