Danish-based real estate asset manager BPT Asset Management A/S and Savills Japan Ltd. has entered into a cooperation agreement to raise equity for the BPT funds in the Asia Pacific region.
Although the agreement encompasses the entire line of BPT funds, the cooperation will focus firstly on raising funds for the German market through BPT Hansa Lux SICAV-SIF; a Luxembourg-based closed-ended vehicle focusing on commercial real estate in Northern Germany.
"Many Asian investors have equity to place and they are looking for core to value-added products with dedicated managers who can present a solid track record. BPT can provide this through funds such as BPT Hansa," explains Corporate Finance Director Kelly C. Hayes.
The fact that Asian investors have an appetite for European core markets - Germany in particular - has recently been highlighted in the press. Unlike the Japanese market, the German funds can offer yield levels around 6-7% in line the return targets of many Asian institutional investors looking for core exposure.
For BPT the agreement presents an opportunity to expand the capital sourcing network.
"Savills has an impressive brand and presence in the Asia Pacific region. Their relations are strong and for someone like us, they provide a very professional platform for reaching out to Asian investors," says Head of Investor Relations and Marketing Bettina Knudsen.
Bridging the gap and adding value
Sourcing capital from Asia is currently at the top of many European and US asset managers' wish lists. But despite the interest, European managers often experience difficulty in attracting Asian investors.
"Through our market research we have found that there is a significant demand from international investors to source equity from the Asian markets, Japan in particular. But many investors fail in their attempt because they don't understand the culture and processes of capital raising in the region. As a leading player in the Asian real estate markets, with strong ties to the institutional investors in the region, Savills can help asset managers to bridge the gap," says Kelly C. Hayes.
To secure stability, focus and steady income flows, international investors have also begun raising the bar on asset managers, i.e. they have a strong preference towards quality over quantity. This provides an opening to niche managers with very focused strategies.
"BPT is leading regional player within the real estate asset management industry in the Baltic Sea region, namely Germany, Nordics, Poland, the Baltic States and Russia. With a clear geographical focus and a strong on-ground presence we can offer the niche qualities and dedicated approach that many investors are looking for today", says Bettina Knudsen.