Savills Investment Management on Wednesday announced the launch of its first pan-Asian fund after a first closing of $117 million.
The Asia Pacific Income and Growth Fund (APACIG) focuses on core-plus investments with a low to medium risk profile, while also incorporating a defined value-add component, with the potential to offer co-investment opportunities, Savills IM said in a release.
The fund will invest in a diverse range of sectors, including offices, industrial, retail and residential, with a target investment volume of $1.2 billion, including a maximum debt ratio of 60 percent at fund level. The newly-appointed head of investment for Australia, Greg Lapham, formerly of Savills IM’s Hong Kong office, will manage the fund with his freshly-installed investment team.
“We have been active in the Asia Pacific market for a number of years across a variety of different sectors,” said Alex Jeffrey, chief executive of Savills IM. “The combination of the launch of a dedicated pan-Asian strategy and the expansion of our Sydney office represents a step-change in our growth across the region.”
Aiming for Asia’s Gateways
Savills IM, an investment management subsidiary of the UK-based property services firm, targets an internal rate of return of 8 to 10 percent for APACIG. The firm aims to deploy the fresh capital in Asia Pacific’s developed markets and key gateway cities to capitalise on their stability, resilience and liquidity. The fund is available to institutional investors and family offices.
APACIG has already made its first two acquisitions, bringing Savills IM’s assets under management in Australia to $310 million.
The fund recently completed the $117.4 million acquisition of 241 O’Riordan Street, an 11-storey office building in the Mascot submarket near Sydney, as well as the $112.4 million purchase of Clifford Gardens Shopping Centre in Toowoomba, Australia’s second-largest inland city.
Savills IM manages properties worth $1.6 billion in the Asia Pacific region, with local offices in Singapore, Tokyo, Kuala Lumpur and Sydney.
Growing an APAC Team
Lapham, who leads a four-person investment team in Sydney, has over 30 years of experience in real estate investment, financial reporting, corporate finance, consulting and transaction advisory.
Now back in his native Australia after spending the last decade in Hong Kong, before joining Savills IM last year Lapham served as chief investment officer for Asia Pacific real estate at US investment manager BlackRock.
“Due to its transparency, Australia is an important and attractive destination for real estate investments,” Lapham said. “It will play a prominent role in our continued expansion in the Asia Pacific region. It’s likely that the next deal will be in Japan where we have a strong investment presence and where we believe growth prospects in certain sectors are also very positive.”
Lapham is supported by investment director Guy Sainsbury, who recently joined Savills IM from Lendlease, where he held various senior development, capital raising and origination roles. Investment manager Anthony Lupis and investment analyst Jacob van Egmond round out the Sydney-based team.