KKR closes its first Asia real estate fund at US$1.7 billion
Fund will focus on commercial, industrial and residential properties
14 Jan 2021 | The Asset

Global investment firm KKR on Thursday (January 14) announced the final close of a US$1.7 billion fund focused on real estate investments in Asia-Pacific. Called KKR Asia Real Estate Partners (AREP), the fund takes a flexible investment approach across assets and platforms, utilizing equity and debt in both emerging and developed markets.

The firm’s inaugural pan-Asian real estate fund received strong support from a diverse group of new and existing global investors, including public and corporate pensions, sovereign wealth funds, insurance companies, endowments, private banking platforms, family offices and high net worth individual investors.

“AREP’s close marks the next chapter of growth for KKR in Asia-Pacific as we continue to expand our position as a proven alternative capital provider across asset classes,” Ming Lu, head of KKR Asia-Pacific, says in a statement. “Asia-Pacific’s real estate sector needs sophisticated investment and innovative operational solutions to meet the high demand for modernized properties and developments that are required to stay ahead of the region’s rapid growth.”

The fund will leverage the firm’s highly experienced in-country investment teams, its global network of industry and operational experts, and long track record of value creation, according to the statement. It will focus on a range of sectors, including commercial, industrial and residential properties, and will opportunistically evaluate assets in emerging alternative sectors.

Since 2011, KKR has deployed more than US$1.5 billion of equity across approximately 20 real estate transactions in Asia-Pacific, including investments in mixed-use, commercial, industrial, hotel, office and retail properties. The firm has also provided debt financing to real estate developers and companies.

Assets within KKR’s Asia-Pacific real estate portfolio include Namsan Square, an office tower located in Seoul’s central business district; Lake Silver and Parkside, convenience retail assets in Hong Kong; Renaissance Parc Development, a mixed-use hotel, office, and retail development in Seoul; and Oasis Shopping Centre, a shopping centre at Broadbeach on the Australian Gold Coast.

KKR launched its dedicated real estate platform in 2011. As of September 30 2020, the firm has approximately US$14 billion of real estate assets under management in the United States, Europe and Asia-Pacific, and a team of about 90 dedicated investment professionals across 11 offices and eight countries.