UBS AM to Manage $176M ADIC Investment in Singapore Industrial Projects

The real estate investment wing of Swiss financial giant UBS is set to manage S$250 million ($176 million) in investment into industrial real estate projects in Singapore on behalf of Abu Dhabi Investment Corporation (ADIC), according to a recent statement by UBS Asset Management.

The funds are being invested into a joint venture with local Singaporean developer Boustead Projects with the hopes of creating a portfolio worth S$800 million ($564 million). The JV, Boustead Development Partnership, has already committed S$119 million to four projects in the city-state, including two which are already complete.

Singapore Business Park Projects Bring in Gulf Cash

“We are continuing to see strong interest for real estate investment in our priority markets of Japan, Australia, China and Singapore, as well as demand from Asia Pacific investors seeking exposure to Europe, the US and emerging markets such as Brazil,” said UBS Asset Management’s head of real estate for APAC Graham Mackie in a statement.

Two of the initial investments are in Singapore’s one-north business park in the Queenstown area of southwestern Singapore. Already completed in November, was a 14,350 square metre regional headquarters for pharma giant GlaxoSmithKline, and just this month Boustead agreed to develop a 39,487 square metre mixed-use project in Jurong Town Corporation’s (JTC) Mediapolis project which is also in one-north.

An agreement was also signed this month to develop an 11,000 square metre R&D centre for Continental Automotive Singapore in Kallang iPark. Both of the new projects are scheduled to be completed next year. The recently signed Continental development will join Continental Building Phase 3, which Boustead Projects had announced earlier this month.

ADIC and UBS Bet on a Bottom for Singapore

ADIC, which is an affiliate of Abu Dhabi sovereign fund ADIA, is choosing to invest in the Singapore market at a time when many experts believe property values may be nearing the low point of the cycle, and investors have been buying up commercial and industrial properties.

Just last week, Asian logistics platform E-Shang Redwood invested an undisclosed amount to acquire an 80 percent stake in Singapore’s Cambridge Industrial Trust Management Limited, which manages a fund owning a portfolio of 49 properties in Singapore.

In anticipation of an upswing in rents later in the decade, in June last year the Qatar Investment Authority bought Asia Square 1 in Singapore from Blackrock for $2.45 billion. Also last year, CLSA Capital Partners bought a 35-storey office tower on 77 Robinson Road in downtown Singapore for $373 million.

To take advantage of the business park aspect of this anticipated upswing, ADIC turned to Boustead, which has been developing industrial facilities in Singapore for more than 20 years. UBS Asset Management is a familiar partner for the Gulf investment body, which splintered off from ADIA in 2007. UBS’ real estate division implemented a similar mandate for ADIC in Australian multifamily projects in 2014, and has also worked with the company on projects in the Middle East and North Africa.