Asian capital is now more “adventurous” when investing overseas, Goodwin Gaw, chairman and managing principal of Gaw Capital Partners, told delegates at Wednesday's PERE Asia Summit in Hong Kong.
The founder of the Hong Kong-based private equity real estate firm said that four to five years ago the region's largest pools of capital invested in core outside of their borders in order to gain diversification, while focusing on growth at home.
The view was shared by Henry Chin, head of research, Asia Pacific, at global property services firm CBRE. He added that Asian investors are willing to take on more risk and do more opportunistic and value-added investment in the US.
Gaw's firm held final close on a US-focused value-added fund in November. Gaw Capital US Value Add Fund I garnered $314 million in commitments, excluding co-investments, after just over a year on the market. The Hong Kong-based firm is targeting an internal rate of return in the mid-teens, according to sources familiar with the fund.
About half the investors in the vehicle are Asian, some are institutional investors and also a group of Asian super-high-net-worth family offices.
The firm has invested about half of the capital in the vehicle so far, acquiring West Coast assets from Portland, Oregon to San Diego.
In 2014, Gaw also seeded $40 million from the fund into a joint venture with Chicago-based AJ Capital to develop Graduate Hotels, a hotel platform targeting university-anchored towns.