Private Equity Real Estate Quarterly Review—AsiaPacific by gabyion

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									Private Equity Real Estate
Quarterly Review—Asia/Pacific
October 2009




  Asia’s Investors Seize the Initiative
  With Asia’s property prices set to recover from the substantial losses incurred from the credit crisis, no longer
  does it appear that foreign investment managers will monopolise front-page headlines with their multi billion dollar
  investment strategies. Instead it is Asia’s financial institutions with deep cash reserves that are taking front-page
  news as they put capital to work.
  A change in the investor landscape in Asia has also been accelerated by the downfall of a number of global institutions.
  Post-September 2008, many of the global platforms in Asia that were associated with large-scale private equity real
  estate investments have ceased to exist, or are for sale or undergoing restructuring. Through duress and consolidation
  a vaccum has been created and investment activity for at least the short term now looks set to be dominated by Asia’s
  best in class real estate developers, insurers, sovereign wealth funds (SWF), investment managers and banks.

  Leading the Way—China
  Out of Asia’s investors, none seem better positioned than China’s, especially given the estimated capital reserves
  that exist in China today. The insurance industry collectively holds USD400billion assets under management and with
  China’s regulators looking set to allow domestic insurers to invest directly in China real estate in October, a surge in
  real estate investment is expected.
  With the rules therefore set to change, (the China Insurance Regulatory Committee is expected to issue the detailed
  rules on insurers’ investments in the real estate and private equity sectors at the end of October), it has been no
  surprise to see a number of China’s leading insurers building up their own investment teams.


  Chinese Insurers primed for real estate investment

    Company              Movement

    Ping An             • Reportedly submitted an application to set up a private equity investment firm. The group has in-
                          vested in several unlisted firms via its trust unit.
                        • Entered into cooperation with two major real estate enterprises in China, Gemdale and Greentown, to
                          provide 25 billion yuan of investment in three years through Ping An's trust subsidiary Ping An Trust.

    China Life          • China Life Investment Holding, a subsidiary of China Life Group, signed a strategic agreement with
                          China Cinda Investment in July to cooperate in areas including commercial real estate, hotel invest-
                          ments, and property management.
                        • Market hearsay went that China Life is considering cooperation with Financial Street Holding, which
                          operates in real estate investments.

    PICC                • PICC Investment Holding, a subsidiary of the People's Insurance Company Group of China (PICC),
                          has also reached a strategic cooperation agreement with Financial Street, in an effort to cooperate in
                          investing in real estate.




                                                                 Russell Reynolds AssociAtes
Private Equity Real Estate Quarterly Review—Asia/Pacific                                                                 October 2009




    In terms of Asia’s investors putting capital to work, one of the most significant has been China’s CIC. Since 2009, they
    have made a number of eye-catching investment deals, ranging from domestic IPOs to the bail-out of a distressed
    UK Canary Wharf developer.


    Chinese Insurers primed for real estate investment

      Date                       Target                                            Value

      26 September              Oaktree Capital                                    1 Billion

      24 September              Glorious Property Holdings (China)                 20-30 Million (IPO)

      17 September              Poly (Hong Kong) Investments Ltd                   52.8 Million
                                (controlled by Poly Group)

      6 August                  Goodman Group (AU)                                 420 Million

      31 August                 Songbird Estates (UK)                              joint consortium of GBP 800 Million

      17 July                   CITIC Capital (40%, China)                         undisclosed

      1 April                   A new $6 billion global real estate fund to be     800 Million
                                managed by Morgan Stanley




    Predicted Hiring Trends
    The pendulum has firmly swung to Asia’s domestic investors as they build out their investment capabilities especially
    in primary markets like China.
    In addition, for the first time in nearly a year, fund raisers are coming back into demand as funds look to enhance their
    capital raising capabilities and target allocations from SWFs, Pension Funds and Family Offices in Asia.




    Market Moves
    AMB
    • AMB funds president John Roberts will retire in March next year and the role will be assumed by AMB Europe and
      Asia president Guy Jaquier. (September 09)

    Aviva Investors
    • Aviva Investors has promoted Ian Hally to chief executive officer of its real estate operations in the Asia Pacific re-
      gion. (June 09)

    The Blackstone Group
    • The Blackstone Group has named Philip Levinson as a managing director. (June 09)

    Capstone Partners
    • US-headquartered placement agent Capstone Partners has opened its first office in Asia in Shanghai. The real es-
      tate and private equity placement agent has appointed Sheng Lu to head its new Shanghai office. (September 09)

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Private Equity Real Estate Quarterly Review—Asia/Pacific                                                              October 2009



    Citi Property Investors (CPI)
    • John Bottomley has left Citi Property Investors after five years with the firm. He has joined New York-based The
      Rockefeller Group. The departure follows the loss of CPI’s Asia Pacific investments head David Schaefer and the
      cancellation of the firm’s second Asia real estate fund. (May 09)
    • Citi Property Investors (CPI) has appointed its India head, Ravi Hansoty, to lead its pan-Asian real estate platform
     following the departure of former Asia head David Schaefer. (April 09)

    GIC
    • The Government of Singapore Investment Corporation (GIC), which manages assets estimated at more than $300
      billion, has appointed Lim Siong Guan as group president and chairman of GIC Asset Management. (June 09)

    ING
    • ING Real Estate Investment Management has bolstered its management platform in Australia with the appointment
      of Stockland executive Denis Hickey. (September 09)
    • ING has strengthened its position in South Korea after obtaining a licence to operate locally registered real estate
     funds in the country. The firm has also appointed its South Korea investment head, Mark Jun, to a role aimed at
     fund raising from local investors. (July 09)

    LaSalle
    • Jeff Jacobson, the global chief executive officer at LaSalle Investment Management is moving from Europe to Asia
      to help the firm take advantage of ‘unprecedented’ opportunities. He will start work from the Singapore office ef-
      fective from January 2010.
    • LaSalle Investment Management has appointed Chris Martin from Australian property Group GPT to become head
     of asset management.

    Lockheed Martin Investment Management (LMIM)
    • Denis Tse from CDIB Capital will oversee LMIM’s private equity and private equity real estate fund commitments in
      Asia. (July 09)
    • Martin Seol has been appointed head of real estate for Merrill Lynch in Asia Pacific. He takes over from Tim Grady,
     who resigned from the firm at the beginning of April. (April 09)

    Pacific Alliance
    • Pacific Alliance Group has appointed Anthony Miller president and chief executive officer of Pacific Alliance Japan,
      a newly formed unit of the firm. Anthony Miller, known for steering Carlyle’s charge into Asia, will lead Pacific Alli-
      ance Japan in investing in Japan’s real estate, distressed debt and private placement markets. (June 09)

    Pacific Star
    • Pacific Star Group has appointed Wilfred Wong as executive chairman of its China operations. Wilfred Wong will
      formulate and manage the Singaporean group’s business strategies in China and Macau. Wong is also a delegate
      of the National People’s Congress of China and deputy vice chairman of golf course developer Mission Hills
      Group. (February 09)

    Probitas
    • Probitas has opened an office in Hong Kong. The San Francisco-based placement agent, advisor and secondaries
      broker hired ex-AIG Investments executive Edwin Chan to lead its first Asian office. (April 09)

    Standard Chartered
    • StanChart Real Estate Fund Head Richard Johnson has left the firm. (August 09)

    • Chen Fan, head of China activities for Standard Chartered Private Equity, has also resigned. (April 09)




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Private Equity Real Estate Quarterly Review—Asia/Pacific                                                             October 2009




                  Gareth Stubbings [Hong Kong]
                  +852-2523-9123
                  gstubbings@russellreynolds.com


                  Gareth Stubbings is a member of the Financial Services Sector based in Hong Kong.
                  His focus is on serving the firm’s clients in asset and wealth management, and global
                  banking and markets. 

                  Previous Experience
                  Having lived in Hong Kong for more than 30 years, Gareth has over 10 years of executive
                  search experience, recruiting for financial and professional services clients in Asia/
                  Pacific.  Prior to executive search, he worked in the real estate industry as a Project
                  Manager at Claymore Construction Consultants and for a leading international property
                  company in Hong Kong.

                  Education
                  Gareth received his B.A., with honors, in geography and environmental management
                  from Middlesex University.




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