Allianz Real Estate, the $53 billion property investment arm of the global insurance firm Allianz, has finalized its investment alongside the Singaporean conglomerate Keppel Group to purchase SOHO Hangkou in Shanghai for $525 million.
The German investor owns a 30 percent co-investment stake together with Keppel Land China’s 30 percent stake in a holding entity Vision (III). Additionally, Allianz Real Estate has also invested in the Alpha Asia Macro Trends Fund (AAMTF) III, a closed-ended, value-add vehicle that owns the remaining 40 percent stake in the office and mixed-use development asset. This brings Allianz’s total initial commitment to between $150 to $200 million, according to a company announcement.
“Co-investing with local experts is an approach our investors’ favor for the region, and we look forward to broadening our activity in this area,” commented Rushabh Desai, head of Allianz Real Estate Asia Pacific.
Allianz’s latest investment exemplifies the firm’s enhanced focus on Asia, with a target to allocate 5 percent of its global real estate portfolio to the region.
In an interview with PERE last November, Desai and Allianz’s chief executive Francois Trausch spoke about how the firm is planning its push into Asia. Their approach until now has been investing alongside managers through funds and co-investments.
“We will take a step-by-step approach instead of trying to go big all of a sudden,” Desai said at the time. “The markets in the region work at different paces, so it takes time to get used to them and figure out how to navigate through them.”
Globally, Allianz is targeting to grow the assets under management to €60 billion by 2020.