KKR closes first Asia real estate fund at $1.7bn

KKR closes first Asia real estate fund at $1.7bn

KKR announced Wednesday that it has closed its first Asia real estate fund, KKR Asia Real Estate Partners (AREP) focused on opportunistic real estate investments in Asia Pacific, at US$1.7 billion.

“AREP’s close marks the next chapter of growth for KKR in Asia Pacific as we continue to expand our position as a proven alternative capital provider across asset classes,” said Ming Lu, Head of KKR Asia Pacific.

“Asia Pacific’s real estate sector needs sophisticated investment and innovative operational solutions to meet the high demand for modernized properties and developments that are required to stay ahead of the region’s rapid growth. Our experienced team is well-positioned to capture compelling opportunities and add value to our portfolio to generate attractive, yield-adjusted returns for our investors,” he added.

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KKR said the fund will specifically focus on a range of sectors, including commercial, industrial and residential properties, and will opportunistically evaluate assets in emerging alternative sectors.

John Pattar, Head of Asia Pacific Real Estate at KKR, said, “The transformation of Asia Pacific’s real estate sector is creating a strong pipeline of new and exciting opportunities that are well-suited to KKR’s flexible investment approach, local expertise and deep operational experience. Increased domestic consumption, productivity and urbanization – combined with the acceleration of e-commerce and platform-based businesses and the evolution of the traditional office landscape – is fundamentally reshaping the region’s real estate sector. AREP will play an important role in bringing the necessary solutions to the region’s real estate industry during this exciting phase of growth.”

”The Fund represents one of the largest inaugural pan-regional real estate funds to have been raised in Asia Pacific to date,” said KKR in a statement.

“Our ability to raise this Fund in the midst of a pandemic is a testament to the strength of KKR’s Asia Pacific franchise, proven real estate track record around the world, and the trust in our ability to create value,” said Jon Fiorello, Head of KKR’s Real Estate Strategies Team. “We appreciate the confidence that our global investors have placed in our strategy and team.”

Ralph Rosenberg, Global Head of KKR Real Estate, said, “AREP’s close is an exciting milestone for our global real estate platform. Asia Pacific is an integral and increasingly important part of our investment strategy given the attractive growth and demographic drivers shared by markets across the region. Looking ahead, we are well-positioned to build on our successes in Asia Pacific to create a diverse portfolio of investments capable of delivering attractive returns to our investors.”