New Fund To Invest In Property

Source : TODAY, Friday, November 30, 2007

It will start with two projects in Bangkok and is also eyeing opportunities in S’pore.

A new fund has been set up to invest in prime development projects in Asia, including Singapore, targeting US$400 million ($580 million) of prime real estate acquisitions.

The Asia Real Estate Prime Development Fund (AREPDF) has already attracted US$250 million from institutional investors and is expected to reach the target of US$400 million by the first quarter of next year.

It’s the fourth fund launched by the real estate investment house Pacific Star Group, and earlier funds have bought into Temasek Tower, One George Street and The Adelphi.

“We are looking at all possible opportunities, including in Singapore. If the opportunity makes sense and allows us to achieve our targeted returns, then, we will consider it seriously as we have done with Bangkok as our seed investment,” said Mr Glen Chan, president of Pacific Star Investment and Development, who heads the team of fund managers of AREPDF.

The first investment, he said, would be a 49-per-cent equity stake in two residential development projects in Bangkok.

These condominium projects will be developed by Asian Property Development (APD), which is listed on the stock exchange in Thailand and is one of the largest residential property developers in downtown Bangkok.

“This investment is compelling because of the scarcity of prime freehold residential land parcels in the heart of Bangkok and the robust demand for city centre condominiums near train stations,” Mr Chan said.

This fund will invest about US$20 million via joint venture companies, which will develop two condominiums in Bangkok, targeted at upper-middle income local buyers. The two projects, which will develop 1,507 units, will be completed in three years.

“The investment returns from such condominium developments are attractive, considering that the prime location sites are within Bangkok’s central business district,” said Mr Chan, who added that the project has attracted strong interest from potential buyers.