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Partners, Pamfleet in $200m HK exit

An industrial building in Hong Kong acquired via a partnership between Partners Group and the Pamfleet Group has been sold to the New World Development Group.

Partners Group, the Zug-based private markets investment manager, and the Pamfleet Group, the Hong Kong and Singapore-focused private equity real estate firm, have exited their investment in an industrial building in Hong Kong to the New World Development Group, a Hong Kong-based conglomerate.

PERE understands that the property was sold for around $200 million, generating an investment return of 45 percent.

The 13-story industrial building in Hong Kong’s Kowloon East, an industrial area poised to become an attractive alternative to the city’s central business district, was acquired via a joint venture partnership between the two firms in April 2013. The total acquisition price of the property was HK$958 million (€110 million; $123.5 million).

Following the acquisition, plans to convert the industrial building into an office space with a gross floor area of 206,225 square feet were set in motion.

In a statement announcing the exit, Partners Group said that it was able to achieve the exit one and a half years ahead of schedule and also before the complete conversion of the property.

“The building in Kowloon East was a prime example of our investment strategy to fix underutilized properties in markets with strengthening fundamentals,” said Bastian Wolff, managing director and head of private real estate in Asia for the firm. “Our investment thesis of providing additional high quality office space in an area with limited supply successfully generated an attractive return for our clients.”

At the time of the original investment, PERE had reported that the Partners Group had made the investment via its Partners Group Asia-Pacific Real Estate 2011 and the Partners Group Direct Real Estate 2011 funds, while Pamfleet Group invested its 50 percent interest via its maiden real estate vehicle called the Pamfleet Real Estate Fund (PREF), which raised $209 million in equity.