Hines plans to more than triple the size of its Asia real estate portfolio over the next decade, PERE has learned.
The Houston-based private equity real estate firm is aiming to grow its assets under management in the region from $4 billion to $15 billion – or from 10 percent to 20-25 percent of its overall global property portfolio – over the next decade.
“Asia is a growth story – the amount of investable assets in Asia should be the equivalent of Europe and North America,” said Lee Timmins, who was recently elevated to chief investment officer of the Asia-Pacific region and remains chief executive of the Eurasia region.
As part of its expansion drive, Hines will be looking to enter the Japan, Korea and South-East Asia markets. The firm currently is underwriting its first acquisition in Japan and if successful, could have a presence in the country by early next year.
Additionally, the firm plans to grow in its existing markets in China, India and Australia. In China, Hines has been focused on the office and residential sectors in the cities of Beijing and Shanghai and is targeting the same property types in India, developing assets in the cities of Mumbai, Bangalore and Delhi. Meanwhile, in Australia, the firm is undertaking office investments in Sydney, Melbourne and Brisbane.
Under its growth plan, the firm is said to be readying an open-ended, core-plus vehicle targeting Australia and China as well as Japan, Korea and India. It is anticipated that Hines will invest across a range of property types, primarily office, residential and logistics. Hines declined to comment, but PERE understands it may potentially launch the vehicle early next year with an equity goal of more than $1 billion.
Hines will also be opening a regional investment management office in Singapore by early next year. The firm opened its new Hong Kong headquarters headed by Asia-Pacific chief executive Ray Lawler earlier this year to focus on investments in China, North Asia and Australia, but the new Singapore location will also be significant to its Asian investment management business and be well-connected to the India and South-East Asia markets, according to Timmins. The firm also has offices in Beijing, Shanghai, Australia, Tokyo and Seoul.
Hines currently has an on-the-ground team of some 200 people in Asia, which Timmins expects will increase “fairly materially” over the next several years. He explained that the firm started its Asia business in China in 1997 and has grown organically over the past two decades. He expected the platform to continue to grow organically rather than through acquisitions.