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Invista grows in Asia via Babcock & Brown deal

UK listed fund management group, Invista Real Estate Investment Management, has completed a fund platform acquisition in Asia as part of its strategy to expand in the region.

Invista Real Estate Investment Management, the London-based listed real estate fund management group has increased its exposure to Asia with the purchase a fund management platform from troubled Australian infrastructure firm, Babcock & Brown.

In a statement released today, the firm said it had conditionally agreed to purchase the platform which would expand its Asia network to offices in Hong Kong and Singapore. Invista is simultaneously purchasing Babcock & Brown’s stake in its sole Asian real estate fund, the Asian Big Orange Self Storage Fund through its Invista International Fund, for £12.95 million ($19.3 million; €14.3 million). The deals are expected to be completed in May.

The firm said the Invista International Fund would inject further capital into the Orange Self Storage Fund but that it would hold a controlling stake in the vehicle until other investors subscribe. The fund currently owns about 35,000 square metres of storage space across five sites.

Invista entered the Asian market last year with the launch of its Invista International Fund. It said the expanded business would be led by former Babcock & Brown head of real estate for Asia, Broderick Storie. Storie will be head of Hong Kong and Singapore investments and will be charged with establishing new joint ventures and funds. He will report to Invista’s deputy chief executive officer Philip Gadsden, who will chair the firm’s newly established Asian Investment Committee.

Invista has also hired Tom Rowley, Babcock & Brown’s former head of UK real estate. He will be based in the UK and report directly to Invista chief executive officer Duncan Owen.

Owen said the business would give it new fund management revenues originating from Asian markets as well as a new specialist Asian self-storage fund.

He said: “The investment management platform has been taken over at no cost to Invista and provides immediate fund management revenue, with the opportunity to increase earnings further from performance fees. It also enables us to offer further services and real estate opportunities to our existing and future clients with no effect on Invista’s cash surplus.”

Invista Real Estate Investment Management managed £6.7 billion of assets across the UK and continental Europe as of November 2008.