ASIA NEWS: Making things official

Next month, Stephen Schwarzman is scheduled to fly to Singapore to cut the ribbon at an opening ceremony for The Blackstone Group’s office at the Marina Bay Financial Centre in the heart of the city-state’s central business district.

Expected to be joined for the occasion by various Singaporean dignitaries, the firm is keen to improve its visibility in Southeast Asia, which has received far less investment from the world’s largest opportunistic real estate business than the continent’s more mature markets.

In reality, Blackstone’s Singapore office actually opened at the turn of 2012, and today it provides accommodation for approximately 30 staff from across its real estate, private equity and capital-raising businesses. It has been led by Gautam Banerjee, a recruit from accounting firm PwC last year, but no Blackstone partners were stationed there. That situation changed last month with the relocation of senior managing director Alan Miyasaki from the firm’s Tokyo office.

Miyasaki assumes more managerial responsibility with the move, but he also is expected to play an important role meeting Blackstone’s appetite to deploy meaningful capital in Asia’s emerging markets, many of which are in the southeast. Since opening its first office in Mumbai in 2006, the firm has deployed more than $2 billion of equity in Asia and has grown to approximately 50 staff across six offices. This summer, it held a first close on more than $1.5 billion for its first Asia-focused opportunity fund, Blackstone Real Estate Partners (BREP) Asia, but a focus on China, India, Japan and Australia has meant the southeast has seen little attention to date. 

Indeed, outside of India, Blackstone’s exposure to the southern half of the continent currently is limited to its S$125 million (€73 million; $98 million) investment last year in StarHub Green, a suburban business park, from an open-ended fund managed by SEB Asset Management, the real estate subsidiary of Scandinavia’s SEB Group. Blackstone pounced on the asset after SEB’s fund was caught by liquidity issues following requests for redemptions by its investors.

Miyasaki’s arrival is expected to precipitate investments in markets that include Vietnam, Thailand, Indonesia and Malaysia. While large outlays are not slated immediately, it is understood some could figure within the investment period of BREP Asia, which still is in the midst of fundraising and striving to hit its equity target of $4 billion. 

Meanwhile, Miyasaki’s leadership responsibilities in Japan have fallen to managing directors Akira Kosugi, one of about 30 executives inherited in Blackstone’s takeover of Bank of America Merrill Lynch’s ill-fated Asian private equity real estate platform in 2010, and Daisuke Kitta, previously an executive of Deutsche Bank’s real estate and infrastructure investment management business RREEF. Sources familiar with the situation suggested that the duo effectively have been running Blackstone’s Japanese real estate platform for more than a year while Miyasaki’s efforts were more focused on markets like India and Australia. But just like Schwarzman’s ribbon-cutting next month, Miyasaki’s relocation to Singapore makes the firm’s growing appetite for investments in Southeast Asia more official.