Aberdeen aims up to US$400mil for new fund

A view of the waterfront facing Singapore’s financial district. Aberdeen’s latest property fund will be offered to investors seeking to gain exposure to real estate in the Asia-Pacific. — AP

SINGAPORE: Aberdeen Asset Management Asia has launched a property fund of funds aimed at institutional investors seeking to gain exposure to real estate in the Asia-Pacific region that could raise up to US$400mil.

Aberdeen, best known in Asia for its equity funds, has been building up its offerings in other asset classes. It launched two bond funds that will invest in Asian and emerging market debt in April, and set up a US$400mil joint venture with GE Capital Real Estate in May that will invest in residential property in Tokyo.

“Having built a substantial specialist equity and now a growing fixed-income business over the past 20 years, property stands as the next asset class that is ripe for expansion,” Aberdeen Asia managing director Hugh Young said in a statement.

For its latest property fund of funds, Aberdeen is targeting 13%-17% annual returns with gearing of 50%-60%. Aberdeen's existing Asian property funds last year returned 13.3% to 25.7%, it said. Aberdeen expects to raise US$300-US$400mil.

Aberdeen's head of property for Asia Pacific Puay Ju Kang said the UK fund manager expected to allocate most of the money to private equity fund managers that concentrated on single countries or a specific sector. “We tend to prefer managers who are very focused with a very specific skill set,” said Puay.

She said Aberdeen, which manages or advises on about US$1bil in Asian real estate investments, had to date allocated funds to managers that invest in Japan, Singapore, China, India and Australia.

Besides offices, malls and residences, Aberdeen has also put money in a fund that has invested in Japanese nursing homes.

By Reuters