Sweden’s EQT Exeter plans to launch an Asia Pacific logistics fund to pursue investment opportunities in the region’s top markets, a key executive told MTD TV on Thursday.
Matthew Zann, who leads APAC for EQT Exeter, revealed the upcoming strategy during a Q&A session in which a viewer asked about the Stockholm-based real estate fund manager’s intentions for mainland Chinese platform Forest Logistics.
Parent firm EQT is in the process of acquiring Baring Private Equity Asia (BPEA), which set up Forest Logistics with China industrial veterans Hank Hsu and Addy Chen in 2018.
“We’re growing our pipeline pretty rapidly and I think one of the benefits that hopefully the investors can benefit from as well is that we’re looking to roll out an Asia Pacific logistics-focused fund that will look at those key markets of Japan, South Korea, China and Australia,” Zann said. “So if everything goes smoothly and we tick all the boxes with the regulatory authorities, then Forest potentially could play a role in that.”
Synergies With BPEA
In March, EQT agreed to buy BPEA for €6.8 billion ($7.5 billion) in a cash-and-stock deal that would bring the Hong Kong-based private equity firm’s $19 billion in assets under management into EQT’s expanding portfolio.
Last October, BPEA announced that it had secured more than $1.2 billion in equity commitments for the Forest platform, which develops and operates warehouses in gateway cities across China. Forest is using the funds to build a network of over 30 modern logistics properties in the country.
Zann noted Thursday that both EQT and BPEA have a strong presence in Asia via their private capital and real estate businesses and various funds, with Forest anchoring BPEA’s logistics footprint in mainland China.
“In addition, EQT Exeter has its own logistics business in China,” he said. “So in terms of the future, yes, obviously there’s synergies, which is going to help us grow in the region.”
With the acquisition of BPEA set to expand EQT’s portfolio by more than 23 percent, BPEA’s real estate business will be integrated into EQT Exeter upon completion of the transaction, which is expected to take place in the fourth quarter of 2022.
EQT Exeter set up its first presence in Asia in mid-2021, when it established an office in Shanghai, then followed up in January this year with its acquisition of Japanese logistics developer Bear Logi, where Zann served as managing director for 12 years.
EQT acquired Pennsylvania-based Exeter Property Group in early 2021 for $1.87 billion, with the Swedish firm saying at the time that the purchase gave it valuable capabilities in the North American real estate sector. Exeter had more than $10 billion in assets under management when the deal was struck.
Last year, EQT Exeter sold a total of 141 US logistics assets to Singapore’s Mapletree Investments in a pair of transactions totalling $3 billion.