It has taken more than two years, but New York-based fund of funds business Metropolitan Real Estate Equity Managers has finally found a leader for its long-awaited Asia push.
A search that ultimately involved London-based recruitment firm Sousou Partners culminated last month with the appointment of John So as managing director for Asia. So, formerly of Grosvenor, will lead the firm’s efforts in the region from a new office in Hong Kong.
Following the appointment, Metropolitan, which has grown to almost $2.5 billion in assets under management since David Sherman, Robert Burke and David Nasaw founded the business in 2002, is expected to build significantly on the half dozen or so fund commitments it currently has in the region. At this early stage, exact targets aren’t possible, Sherman told PERE, pointing to the fact that So does not start work until later this summer. Ultimately, however, Metropolitan expects to more than double the number of investments made with Asia-focused managers.
“The next step is to go from a half dozen to between 15 and 20 relationships in the region over time,” Sherman said. In terms of capital, there is dry powder – “more than [So] could invest quickly,” he noted, adding that the firm hopes to raise $500 million in capital to be split equally between US and non-US mandates this year alone.
Currently, investments in Asia are made through two of the firm’s 12 funds of funds that were raised specifically to invest in non-US assets. In time, an Asia-focused fund of funds will be introduced.
So will not be expected to work alone either, but again the measure by which Metropolitan’s Asia unit will grow has not been finalised. “When he gets on board, he and I will sit down and figure it out,” Sherman said.
Sherman admitted that So’s hiring will mean less travelling to the region for him, with So picking up the reigns. Reporting to Sherman, So immediately will take Metropolitan’s position on the advisory board of Hong Kong- and Singapore-focused Pamfleet International’s first opportunity fund, Pamfleet Real Estate Fund, for example, to which it committed capital toward its first closing. He also will become the point man for other commitments to Asia funds, including vehicles from Secured Capital Japan and the latest pan-Asia effort of Angelo, Gordon & Co.
Metropolitan’s Asia exposure historically has been more to Japan than elsewhere, but Sherman expects So’s appointment to open the door to more activity in China, where locating managers with a good understanding of both local real estate and Western fund management requirements has proven tricky thus far.
As a final testament to So’s capabilities, Sherman admitted that, had the appointment not materialised, Metropolitan would have waited until Mr Right came along. “We were prepared to continue doing what we were doing in Asia until we found the right person,” he said. “We’re as excited about Asia as we were two years ago.”