Phoenix Property Investors, the Hong Kong-based private equity real estate firm, has launched its first real estate debt fund in Asia with a $250 million capital raising target, Real Estate Capital sister publication PERE reported.
The Asia Secured Debt Fund will invest in privately-negotiated real estate mortgage loans. A first close is expected to be held by the end of the year, and Phoenix is targeting mid-teens returns and around a 1.5 times multiple from the investments.
The firm will use the fund’s capital to provide financing to developers for office and for-sale residential mortgage properties. The target investment markets will be Greater China and Southeast Asia. The average tenor of the loans made via the fund would be approximately three years.
The Asia Secured Debt Fund is the firm’s first debt-focused vehicle in Asia even though it has previously invested in lending projects from its sixth pan Asia opportunistic vehicle that is also currently in the market. The fund’s predecessor – Phoenix Asia Real Estate Investments V – closed on its hard cap of $750 million at the turn of 2014. So far four exits have been made from Fund V, the latest being the sale of an 88 percent interest in an Osaka office building for $190 million.
Phoenix Property Investors usually invests in first-tier markets in Asia, including Greater China, Japan and Korea. Since its inception the firm has raised approximately $2.5 billion of equity for real estate investment and development opportunities in the residential, retail, office and commercial sectors.