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ASIA NEWS: Back for more

The largest US public pension plan has repeated a sizeable commitment to the private equity real estate funds of Singapore’s ARA Asset Management. PERE Magazine September 2012 issue.


What better endorsement of a firm’s investment activities than a sizeable equity commitment from the largest US public pension plan? How about an encore.

The California Public Employees’ Retirement System (CalPERS) earned a 19.2 percent return from ARA Asset Management’s ARA Dragon Fund in the year to March 31 – good enough for CalPERS’ senior investment officer Ted Eliopoulos to last month publically endorse the Singapore-based real estate fund manager as a “disciplined investor with a strong bench of senior executives and capabilities.” The $237 billion pension system had invested $500 million in and alongside that vehicle.

Consequently, CalPERS has committed another $530 million to two new investment vehicles managed by ARA. The pension system committed $480 million to the ARA Long Term Hold Fund, a 10-year (initially) core-plus separate account vehicle to be used for investments in prime, income-producing office and retail properties in China and Hong Kong. It also made a $50 million commitment to ARA’s second ARA Dragon Fund, which also invests in Singapore and Malaysia.

In its first half results last month, ARA said it expected additional capital to be injected into the separate account over time “at the discretion of CalPERS” after the first tranche of equity is deployed. Such is the confidence of a firm adorned with repeated backing from the largest US public pension plan