LaSalle hands Asia’s first open-ended core fund to PRUPIM

The firm's plans to focus on country-specific core funds in Asia going forward have led to it agreeing to sever ties with the Asia Property Fund. LaSalle launched the fund in 2007 alongside Prudential’s PRUPIM with an initial $600m of assets.

LaSalle Investment Management, the real estate investment management firm owned by property services giant Jones Lang LaSalle, is to relinquish its responsibility for the Asia Property Fund, Asia’s first open-ended core fund.

In partnership with PRUPIM, part of the M&G group of companies that form the asset management business of UK insurance giant Prudential, LaSalle launched the fund in July 2007. It was seeded with $600 million of assets previously directly-held by Prudential’s UK life funds and, at the time of its launch, the partners planned to grow the fund to more than $1 billion by 2008.

The fund held properties in Australia, Singapore, Hong Kong and Korea and both LaSalle and PRUPIM injected initial equity.

However, LaSalle said in an announcement today it had agreed for PRUPIM to assume sole responsibility for managing the fund. As part of the deal, LaSalle would still provide asset management services to the fund’s existing portfolio until the end of the year.

The firm said it had determined the best opportunities for investing in core real estate in Asia would be on a country-specific basis and not a pan-Asia basis.

In a statement to PERE the firm said: “We believe the best opportunities in core real estate across Asia will be country-specific, rather than pan-Asia. Thus we plan to focus our investment opportunities on a country-by-country basis and tailored to the specific needs of our clients.”

“In fact we are currently marketing the LaSalle Australia Core Plus Fund,” the firm added. According to its website, the LaSalle Australia Core Plus Fund is an unlisted fund focused on providing “above benchmark” returns to institutional investors seeking consistent income returns, some capital growth and “a component” of active asset management and repositioning.

“These core products will complement our successful opportunity fund series and Japan logistics [fund series],” the firm said. LaSalle is currently in the market trying to raise a fourth opportunity fund in Asia with a target of $750 million. It is also in the market with a third Japan logistics fund after exiting the majority of the assets from its first Japan logistics fund in a sale to Global Logistics Properties and China Investment Corporation in December valued at $1.6 billion.

LaSalle established its platform in Asia in 2000. It currently has approximately 180 staff and manages just less than $9 billion of assets in the region.