The fund, the Gateway Real Estate Fund V, is the firm’s largest to date, according to a statement from the firm.
The spokesman said that the fund attracted institutional investors, such as sovereign wealth funds, endowments and pension funds, as well as high-net-worth individuals (HNWIs) globally.
According to the firm’s statement, the majority of all of the investors of the fund came from Asia (46%), followed by North America (34%) and Europe (20%).
Although investments coming from HNWIs account for less than 5% of the fund, the firm saw increasing interest coming from the segment, especially from mainland China, according to the firm’s spokesman.
Globally, most HNWIs investment in the fund came from Asia and the US, according to the spokesman. More HNWIs from China invested in the fund than those coming from Hong Kong, he added, partly because investors in Hong Kong have more asset classes from which to choose.
Separately, the firm noted that it does not work with private banks and wealth management outfits in Hong Kong or Singapore, and does not actively market its products to the high-net-worth segment. Instead, it has attracted interest from the segment through word of mouth.
Appetite for private equity
Globally, HNWIs are increasingly investing in private equity, according to survey findings from Preqin, as reported. As of end-December, family offices accounted for 9% of all active investors in private equity worldwide, up from just 5% four years before. The average allocation of family offices to private equity as a proportion of their total assets grew to 28.9% from 24.7% over the same time.
In addition, the survey showed that 89% of investors in private equity felt the asset class had met or exceeded expectations.
Another survey by Natixis also shows that Asia-Pacific institutional investors are pleased with their private equity investments. Seventy-one percent of them were satisfied with the performance of private equity, which compared to 67% globally.
Fund investments
Gaw Capital’s Gateway Funds target real estate assets mainly in Greater China, with selected exposure to Japan, South Korea, Southeast Asia and Australia, according to the statement. In addition to primary gateway cities of Beijing, Shanghai, Guangzhou, Hong Kong, Macau and Taipei, the fund also looks at secondary cities in China that demonstrate strong economic fundamentals and long-term real estate demand, for example in the Jiangsu province.
“We believe opportunities exist in the region to acquire large and partially or fully completed investment grade assets from over-leveraged investors at attractive valuations,” Kenneth Gaw, the firm’s managing principal and president, said in a statement.
In addition to the Gateway Funds, the firm also manages funds focusing on Vietnam and the US, along with a hospitality fund targeting the Pan Asia region, according to the statement. Since 2005, the firm has raised equity of $7.5bn and currently manages around $12bn in assets.
Besides Hong Kong, the firm has offices in Shanghai, Seoul, London, Los Angeles and San Francisco.
