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Trinity launches fifth Asia fund – Exclusive

The Honolulu, Hawaii-based real estate fund manager is seeking to raise up to $500 million for what would be its largest-ever fund.

Trinity Investments has hit the fundraising trail with its fifth Japan-focused real estate fund, Trinity Asia Fund (TAF) III. The Hawaii-based fund manager is understood to be targeting $300 million to $500 million for the vehicle, which, if successful, would be its largest vehicle to date.

Trinity declined to comment, but PERE understands that the firm launched the fund about two months ago and secured a $100 million commitment from an anchor investor, a Middle Eastern pension plan. The private equity real estate firm is expected to hold a first close on TAF III in September and a final close in December or January.

Trinity is said to be pursuing a core-plus and value-add strategy for the fund, which will be focused predominantly on investments in the retail and multifamily sector, primarily in Japan’s major metropolitan markets. The firm will be focused on off-market transactions that will largely be sourced through an alliance formed in 2010 with one of Japan's largest real estate owners. Trinity has not yet deployed capital from the fund.

The first two funds in the series were named Trinity Japan Investors I and II and had a more opportunistic, higher leveraged strategy focused on Japan. TAF I and II, by contrast, were more focused on core-plus and value-add investments and had a broader geographic focus to allow for potential investments outside of Japan. Through TAF I, which collected a total of $50 million in 2005, Trinity deployed $180 million to $200 million, while through TAF II, a 2010 vintage fund, it raised ¥11 billion and invested about $300 million.

Trinity, which was founded by hotel developer Charles Sweeney in 1996, has been active in the Japan real estate markets since 1998. After executing numerous real estate transactions in Hawaii with Japan-based partners during Hawaii’s down cycle in the early and mid-1990s, Trinity began participating in off-market transactions with those same partners in Japan as the country’s property market suffered similar illiquidity in the late 1990s.

In 2003, Trinity’s affiliates were among the first foreign-controlled investors to form a Japan real estate investment trust, or JREIT, to liquidate a portfolio of assets that the firm acquired from 1998 through 2001. A second JREIT, named Invincible, was formed in 2005.