<article>Hong Kong-based asset manager Value Partners Group is looking to increase its allocation for alternative investments with the launch of two more real estate funds soon, said a top executive.</article>

Hong Kong-based asset manager Value Partners Group is looking to increase its allocation for alternative investments with the launch of two more real estate funds soon, said a top executive.
In an email interaction with DEALSTREETASIA, Value Partners CEO Au King Lun noted the asset management firm had launched its first real estate fund at $170 million last June, of which more than 75 per cent has been deployed.
&#8220;Our AUM from private equity is not significant at present and accounted for less than 1 per cent of AUM (assets under management) as of the end of June. However, we expect this percentage to increase over time as we deepen our push into private equity as well as the broader alternatives space.
“We expect to acquire two more assets for the [real estate] fund in the second half of 2018. In light of the fund’s strong performance, we will be launching another two private equity real estate funds very soon,” he said.
However, Value Partners declined to furnish the fund size and targeted investors for the new real estate funds.
In July, the asset manager established its inaugural private equity fund in Mainland China, <a href="https://www.dealstreetasia.com/stories/value-partners-pe-fund-china-101197/">VP-CEG China Education Fund</a>, with Huajiao Education, a subsidiary of China Education Group Holdings, a listed education management firm. The fund will be launched in early 2019, with a target AUM of RMB 5 billion ($720 million), subject to regulatory approval.
&#8220;The fund will be among the first funds to allow foreign investors to invest directly into private higher and vocational education in mainland China via QFLP (qualified foreign limited partner),&#8221; added Au.
Meanwhile, Value Partners Group’s upcoming private debt fund will have its first close by the end of the year. Au said the targeted AUM for the private debt fund is at least $550 million.
&#8220;Alternatives will play a central role in our product suite expansion going forward. We anticipate a strong demand for alternative investment funds in Asia as investors increasingly look to diversify across multiple asset classes.
&#8220;At the same time, the ripening ecosystem for alternative investments in China presents an exciting investment opportunity set that is attractive to fund investors globally. The low correlation in performance and flows between alternatives and traditional asset classes also make the asset class an apt addition to our AUM mix,&#8221; he said.
<h3>KL office as regional hub</h3>
In addition to upping its ante in private equity and the overall alternatives space, Value Partners Group has also recently set up an office in Kuala Lumpur. The office will serve as the Southeast Asia hub for the firm, which has received in-principle approval from Securities Commission Malaysia for a Capital Market Services License for Fund Management.
&#8220;Southeast Asia is one of the fastest growing regions in the world and is enjoying rising wealth. As a result, we see great potential for the growth of Southeast Asia’s asset management industry. Southeast Asia is an important market for Value Partners as we look to build our global footprint and grow into a world-class asset manager.
“On the products front, our Malaysia office will provide a base for us to expand into new business areas such as Southeast Asia-focused ETF products and Shariah-compliant funds. We also already have a pretty strong network of clients and business partners in Malaysia and the new office will allow us to serve them better,” said Au.
According to a report by The Star, Value Partners Malaysia is looking at a fund size of $150-200 million over the next three to five years. However, the firm declined to comment on the fund, citing compliance reasons.
As of August 31, 2018, Value Partners Group has $16.6 billion in AUM. It was established in 1993 by chairman and co-chief investment officer Cheah Cheng Hye. It was the first asset management firm to be listed on the main board of Hong Kong Stock Exchange in November 2007.
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The asset management firm had launched its first real estate fund at $170 million last June, of which more than 75 per cent has been deployed.

Hong Kong-based Value Partners to launch two new real estate funds

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Hong Kong-based Value Partners to launch two new real estate funds

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