Ian Hally, the former chief executive officer of Aviva Investors’ Asian real estate business, has launched a hospitality-focused private equity real estate fund for investing in Japan’s hotel sector with a $200 million capital raising target.
Hally, who will be the general partner of the NARA Japan Hotel Fund, told PERE a first close is expected by the end of March this year. Institutional investors based in Europe and Asia are among those being tapped for capital.
The Singapore-based financial services company Swiss-Asia will be providing regulatory and operational support to the fund. Swiss-Asia advisor Fredrik Johansson will also be working on deal sourcing and asset management for Hally's fund.
Capital from fund the will be invested in the mid-market hotel sector across Japan in income-producing assets with a value-add component attached to them. IRRs of between 10 to 15 percent are being targeted from the investments.
A growing number of tourists flocking Japan has led to increasing demand for hotel rooms in Tokyo. In addition, demand from corporate customers is also expected to surge given the upcoming Olympic Games in 2020. On the supply side however, constraints remain due to rising labour and construction costs, creating a sound opportunity for investments in the hospitality sector, according to Hally.
Hally has undertaken this venture while remaining the chief executive officer of GreenPlace Assets, a Singapore-based real estate investment advisory and asset management firm he founded in April last year.
A real estate industry veteran with over 20 years of industry experience, Hally left Aviva Investors in the wake of the platform’s sale to JPMorgan. In December 2014, Aviva Investors’ Asia real estate business in Australia, Japan and Singapore was officially merged into the Asian real assets division of JPMorgan Asset Management. Its leadership was passed on to David Chen, the chief investment officer and head of real estate Asia at JPMorgan Asset Management.
Prior to assuming leadership of Aviva’s approximately 20-staff platform in the region, Hally was the global head of real estate strategy at Scottish Widows Investment Partnership – now owned by Aberdeen Asset Management – and has also worked for another investment manager, F&C Asset Management, as an analyst.