Indonesia’s first and only sovereign wealth fund expects to expand its real estate allocation to 15% over the next five years.
The manager has established a regional sidecar to invest alongside its flagship opportunistic global fund for the first time.
At the PERE Network Asia Summit, the sovereign fund's global head of real estate said elevated rates had made the sector less competitive.Â
Pollack will be joining the firm at a time when alternative lenders are expected to be able to significantly increase their market share.Â
The Dallas-based manager closed the 10th fund in its flagship value-add series on $3.1bn, a 35% increase on the previous fund.
Investors may be amenable to investment period extensions in today’s climate, but lengthening the fund term could have more serious implications.
The firm will focus on converting existing hospitality assets into co-living properties in the country through a value-add strategy.
The Hong Kong-based firm has received an initial commitment of more than $400m from an anchor investor in the fund.
Most assets need an additional 15-20% in reserves to address refinancing issues, according to the advisory firm’s co-founder.
Ares Management data shows deal volume for the asset class fell 21% in 2023 from the record $12.4bn clocked the year prior.
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