Singapore: A Singapore-based real estate investment and fund management firm, Pacific Star Group, said on Tuesday it aims to raise $2 billion (Rs8,020 crore) for an Asian property fund.
The firm plans to get the funds from global institutional investors to invest in properties in India, China, North-East Asia and South-East Asia, Frank-Rainer Vaessen, Pacific Star’s president of fund management, said in a telephone interview from Munich.
Vaessen, a former managing director at Ergo Versicherungsgruppe AG, a part of Germany’s Munich Reinsurance Co., said investors have become more cautious due to the ongoing credit crisis, but continue to view Asian real estate as a growth sector due to the region’s expanding economies.
“The risk appetite for investors has reduced a little bit and is focused more on established markets like Singapore, Japan and South Korea, but no one is ignoring China either,” Vaessen said.
“The latest measurements of the government have created some uncertainties, so it is not so easy to convince investors to invest in China, but at the end of the day, no investors will ignore China among their country allocation,” he said.
The new fund, which will officially launch on Wednesday, is Pacific Star’s biggest to-date, and is structured as an umbrella fund investing in four new country funds, set up to acquire properties in China, India, Northeast Asia and Southeast Asia.
Vaessen said he is optimistic about raising $1 billion in funds by mid-year, and another $1 billion by year-end, as the targeted investors are largely untouched by the ongoing credit crisis, which has frozen liquidity for financial institutions.