UK funds target Asian property

United Kingdom based Aberdeen Asset Management is set to launch two funds worth around $US600 million each focused on the Asian property markets.

Aberdeen‘s Singapore based funds manager Kang Puay Ju said yesterday the group has already raised around $US400 million for the fund, which is aimed at European institutional investors.

She told Reuters that high net-worth investors would also likely be attracted to the Asian property targeted funds.

Kang said that for many European investors Asia is still far away, however, focus on Asian property is increasing every year.

According to Jones Lang LaSalle direct investment in Asia-Pacific property totalled nearly $US100 billion in 2006 — up around 40% from 2005.

Kang said Singapore commercial property would have a good run for a couple of years while supply lags demand.

Kang indicated Aberdeen are interested in “value add” funds, which typically buy second- or third-grade buildings and refurbish them before seeking new tenants.

She also told Reuters that Aberdeen would look at Japan, Malaysia, South Korea, India and China.

Aberdeen‘s move into Asian property comes hot on the heels of a number of other investment group’s launching similar property trusts. ING Real Estate intends creating two $US1 billion Asia property funds while Invesco has plans for a US$300 million fund for Japan and China property.

As reported in Australian Property Journal last week Citigroup Property Investors recently launched an Asian property fund involving some $US1.29 billion.

Kang told Reuters that around 30 funds targeting Asian property were now on the market.

Australian Property Journal