Phoenix Property Investors, the Hong Kong-based private equity real estate firm, has sold the Kwun Tong View office tower in the city again – for more money. PERE can reveal the firm, led by entrepreneurs Samuel Chu and Benjamin Lee, has entered a binding agreement to sell the 25-story property for $255 million. The buyer is understood to be a high net worth family with industrial holdings in mainland China.
The price represents a 7.3 percent increase on a deal struck with the ARA Prosperity REIT, a real estate investment trust managed by Singapore-based investment manager ARA Asset Management. A prior agreement to sell the property to ARA Prosperity for $240 million was abandoned after more than 60 percent of the REIT’s shareholders vetoed the deal last October.
Despite the delay in exiting the asset, Phoenix’s hold time was still limited. The firm acquired the asset in November 2014 in an off-market sale and, following various asset management initiatives, brought it to market last year.
The Kwun Tong View tower was purchased on behalf of Phoenix’s fifth Asia opportunity fund, which closed at the end of 2013 on $750 million. The vehicle, the largest raised by the firm to date, is understood to be currently approximately 80 percent deployed.
The exit is understood to have crystallized a gross internal rate of return post-tax of 38 percent and an equity multiple of almost 2.3 percent, more than the fund’s overall return target.
It is believed to be the fifth exit from the vehicle, through which Phoenix has a remit to invest in Asian markets including: Hong Kong, mainland China, Taiwan, Japan, Korea and other South-East Asian markets.
Phoenix was unable to comment at press time.