Aberdeen Property Investors has held a final close for AIPP Asia, its first Asian fund of property funds vehicle, at $600 million (€440 million).
The fund, launched in October 2006 with $91 million of equity commitments, is believed to be the only Asian fund of property funds on the market.
Bo Ljunglöf, fund manager of AIPP Asia, said the fund received commitments from 15 institutional investors in the Netherlands, Switzerland, Ireland, Denmark, Finland, Norway and Sweden. Its lead investors included the Swedish groups Folksam and Handelsbanken Liv and the Finnish group Ilmarinen.
Ljungöf said the first vehicle has so far invested $285 million in six Asian funds. Two are dedicated to Japan, one is a pan-Asian shopping centers opportunity fund, one is a pan-Asian retail fund and one is a development fund in Malaysia. The firm has also made a co-investment in Malaysia.
As a follow-up, Stockholm-based Aberdeen has launched AIPP Asia Select, a new fund of funds which will have the same remit as the first. Both the original fund and its follow-up are being managed by Ljunglöf and Kang Puay Ju. Kang was previously at Dutch pension fund ABP, where she helped establish its Asian real estate platform. Prior to that, she was a vice president at GIC Real Estate, the property arm of the government of Singapore's investment division. She is based in Singapore.
The pan-Asia Pacific funds aim to give investors a net annual internal rate of return of between 13 and 17 percent leading to an annual distribution of 4 percent. In addition to investing in funds, the vehicles may also undertake co-investments and joint ventures that fit with its overall strategy.
“Although the [second] fund has not been widely marketed yet, a number of investors have expressed an interest in it,” said Ljunglöf. “The Fund received initial seed capital from an institutional lead investor at an early stage and a next closing is planned in October.”
Ljunglöf added that the new fund has specified that leverage for this vehicle will not exceed 75 percent. It also has a lifespan of 10 years rather than the twelve for the first fund.
Last year, Aberdeen launched the first and largest pooled fund of funds focused on Europe. That vehicle raised €624 million.