Saturday, April 6, 2013

Yishan raising more than US$200m for 2 Indonesian real estate funds

The Straits Times  |  06 Apr 2013 11:40 PM

[SINGAPORE] SINGAPORE-based Yishan Capital Partners, which is developing an office project in Jakarta, plans to raise more than US$200 million through two funds that will invest in warehouses and shopping malls in Indonesia.

The company, which has a team that bought or managed more than US$11 billion of real estate assets, plans to close on the US$100 million warehouse fund by the end of June, managing partner John van Oost said. Yishan will also start fundraising for the US$100 million retail fund, as well as one that will invest between US$50 million and US$75 million in industrial properties in the Philippines, he said.

Yishan is trying to capitalise on opportunities in South-east Asia where a growing middle class, rising disposable incomes and changing lifestyles spur growth. Five of the region's economies - Indonesia, Thailand, Philippines, Malaysia and Vietnam - along with China and India, will outpace the rest of the world over the next two years, the International Monetary Fund said in a July 16 report last year.

"The money for emerging markets is there," Mr van Oost said. "It's coming mostly from private-equity funds, sophisticated funds, a lot of it from the region, from Asia." Yishan has a joint venture with Rodamas Group, a Jakarta-based private industrial group, to help build warehouses in Indonesia, Mr van Oost said.

The company, which focuses on Southeast Asia, hasn't hedged its investments as it gets rents from its Indonesian industrial properties in US dollars, he said. Also, not all South-east Asian countries are attractive. Singapore's residential market is a "big bubble", and will remain "flat" in the short term, he added.

Singapore home prices climbed at the slowest pace in three quarters in the three months to March 31 after the government imposed more curbs such as higher stamp duties for housing transactions. Singapore's home sales plunged 65 per cent to a 14-month low in February after the government introduced its seventh round of property curbs to cool record prices.

Record home prices amid low interest rates raised concerns of a housing bubble and prompted the government to widen a four-year campaign to curb speculation in Asia's second-most expensive housing market.

"If the market in Singapore was in Europe and the US, it would have crashed massively," Mr van Oost said. "But there is population growth, wealth creation and well-capitalised banks, which can clean up the bubble all the time."

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