Angelo, Gordon plans $1bn Asia-focused fund

The AG Asia Realty Fund II would be almost double the size of its predecessor and would invest across all sectors, primarily in China and Japan, with a secondary focus on Korea and Southeast Asia.

New York based private equity firm Angelo, Gorgon & Co is raising the AG Asia Realty Fund II, its second Asia-focused property fund, which is targeting $1 billion of equity.

“Fund II is targeting a final close in the third or fourth quarter of 2009, although we understand that it is a difficult fundraising environment,” said Wilson Leung, the firm’s Hong Kong-based managing director, in an interview.

The fund will primarily focus on China and Japan with a secondary focus on Korea and Southeast Asia. It will invest in deals of between $20 million and $100 million across all sectors.

AG Asia Realty Fund I closed on $526 million in 2006, and is approximately 80 percent invested in China and 20 percent invested in Korea. The firm is targeting 20 percent returns from the fund, after fees.

“Even in this market, our first fund looks to be on target because we underwrote very conservatively and avoided some of the major problem areas in the region such as Japan between 2006 and 2008,” said Leung.

Founded in 1988 by two former Rothschild bankers, Angelo, Gordon & Co. is headquartered in New York and invests in fixed income, multi-strategy, real estate and private equity strategies. In Asia, the firm has offices in Hong Kong and Seoul.