Hong Kong-based alternative asset management firm Baring Private Equity Asia has hit the final close of its second dedicated real estate fund with total capital commitments of $1 billion.
The BPEA Real Estate Fund II was oversubscribed and closed in July at its hard cap, the PE firm said in a statement. The initial target corpus of the fund was $750 million. It had achieved a first close in December 2017.
The limited partners in the second fund include pension funds, endowments, foundations and insurance companies.
The second fund will focus on real estate projects across Asia-Pacific including India, Greater China, Japan, South Korea, Australia, Singapore and Southeast Asia.
Baring PE Asia Real Estate is yet to strike a deal in India.
The fund has the flexibility to make equity and debt investments in real estate projects. It can also invest in assets through joint venture partnerships.
In its first commitment, the fund backed a logistics platform in China with the value of the deal pegged at $300 million.
BPEA Real Estate was started in 2011 as part of Baring PE Asia. It raised $365 million for its first real estate fund in 2015.
That fund is fully invested with the money spread across nine companies. It has already made a full exit from four of these assets.
“We established our real estate platform as a way for the firm’s private equity investors to access the attractive risk-adjusted returns in Asian real estate markets,” said Jean Eric Salata, chief executive and founding partner of Baring PE Asia. “Around 60% of the investors in the second fund are also investors in our private equity funds.”
Mark Fogle, head of real estate at BPEA Real Estate, said he was bullish about growth in the Asia-Pacific region and said the need for better quality real estate assets provided a great investment opportunity.
Baring PE Asia
Baring started operating its first Asian private equity fund in 1999 at $305 million, and over the years has grown into one of the largest independent investment firms in the region with over $16 billion of committed capital. Its last fund was raised in 2015 at $4 billion.
Baring PE Asia was reportedly on the road to raise $6 billion for its seventh and largest-ever fund https://www.vccircle.com/baring-private-equity-asia-raising-new-6-bn-fund. The PE firm reportedly hit the first close at $4.5 billion, according to a report by Private Equity International.
Baring's new Asia fund would be among the biggest in the region. KKR & Co closed a record $9.3 billion Asia-focused buyout fund in June last year, surpassing similar fundraising efforts by global peers such as Carlyle Group and Blackstone Group LP.
Its recent stake sale in mid-sized Indian software services company Hexaware Technologies Ltd marked the PE firm’s first exit move in more than three years in the country.
Baring PE Asia also has a credit platform which is exclusively focussed on India. The platform was set up in 2016 to explore the growing demand for debt among large and mid-sized Indian companies.
Baring PE Asia operates from eight offices located in Hong Kong, Singapore, Tokyo, Shanghai, Beijing, Jakarta, Mumbai and Delhi.