Warburg Pincus Set to Raise $1.5B for Dedicated Asia Real Estate Fund

Private equity major Warburg Pincus is laying the groundwork for a $1.5 billion capital raise under its first fund dedicated to real estate investments in Asia, according to a regulatory filing.

In a Form D filing of an exempt offering of securities, Warburg Pincus Asia Real Estate LP notified the US Securities and Exchange Commission of the upcoming $1.5 billion equity offering in a pooled investment fund. Samsung Securities of South Korea was listed as the placement agent for the private venture.

The notice was filed with the SEC on 26 March and signed by Harsha Marti, managing director and general counsel at New York-based Warburg Pincus. Representatives of the company declined to provide details beyond what was made available in the SEC filings.

The new vehicle signals more deals on the way from Warburg Pincus, which has been among the most active international fund managers in Asia’s real estate markets with about $6 billion invested in 35 real estate ventures and platforms around the region.

Warburg Pincus co-founded China’s New Ease, which struck a $1 billion partnership with QuadReal that was revealed in the past week, as well as regional logistics platform ESR. The firm also helped lead the privatisation of Singapore investment firm ARA Asset Management in 2017.

Sharpened Focus

The newly registered fund focuses purely on real estate after the firm’s pan-sector Warburg Pincus China-Southeast Asia II vehicle had closed on a total of $4.25 billion in June 2019.

The 2019 fund, which had an initial goal of $3.5 billion, ultimately brought in more than double the $2 billion that the firm raised for its first pooled Asia vehicle, Warburg Pincus China, in 2016.

Warburg Pincus China-Southeast Asia II is a companion to Warburg Pincus Global Growth, a $14.8 billion growth-focused private equity fund that closed in 2018. The two funds jointly invest in real estate, healthcare, financial services and telecom opportunities in China and Southeast Asia.

APAC Enthusiasm

With its latest fund still in progress, Warburg Pincus has been busy in recent months committing fresh capital to real estate ventures in the region.

In mid-March the company helped lead a $700 million pre-IPO investment in JD Property, a real estate fund management division of mainland e-commerce player JD.com. The New York-based firm is also backing data centre startup Princeton Digital Group, which raised $360 million last year to further its APAC expansion.

Going further back, Warburg Pincus scored a pan-Asian win with Hong Kong-based logistics giant ESR, which the private equity firm co-founded and controlled until a series of share sales reduced its stake to less than 5 percent late last year.

Elsewhere in Asia, Warburg Pincus last May boosted its interest in ARA Asset Management to almost half of the company’s issued shares, marking the first changes to the shareholding structure of the Singapore-based fund manager since it was taken private in 2017.

Warburg Pincus has more than $58 billion in assets under management. The firm’s 19 private equity funds have invested more than $89 billion in over 920 companies in more than 40 countries.