Aberdeen Asset Management has received EUR151.5m of initial commitments for its new Aberdeen European Secondaries Real Estate fund, with Första AP-fonden (AP1) as lead investor.
The property multi-manager team will construct a portfolio of around 15 funds which will have exposure to over 200 properties in Europe. Lars Graneld and Johan Temse will be the lead managers and will draw on the investment expertise, network and research of Aberdeen’s property multi-manager team based in London, Amsterdam and Stockholm.
The property multi-manager team has made over 100 investments in property funds and holds advisory board seats in more than half of these. The team’s investment approach is to firstly focus on quality as defined by the underlying characteristics of the properties and the expertise of management; the second guiding factor is price in terms of buying these quality portfolios of properties at attractive discounts. The fund will have a final close by September 2014.
Investments in property funds are typically put up for sale by institutional investors for a number of reasons including regulatory requirements, such as the introduction of Solvency II and Basel III, performance, asset allocation. The investment universe available consists of more than 100 funds which are a mix of sector, single country and regional strategies.
“We believe that providing liquidity to a market where sellers far outnumber buyers, combined with the increased interest for investments beyond core in Europe, will provide us with investment opportunities with attractive risk-adjusted return,” says Tomas Svensson, portfolio manager real estate at AP1. “We think that Aberdeen as fund manager is in a great position to capitalise on this strategy.”
Jon Lekander (pictured), global head of property multi-manager for Aberdeen, adds: “As the first asset manager to launch a European property fund of funds, this secondaries fund is a natural progression for Aberdeen. Our experience, expertise and in-depth coverage of the property funds market mean we are well placed to construct and manage a secondaries fund portfolio of high quality investments. We see a growth of attractive secondaries opportunity in this part of the market as investors are becoming increasingly active in the management of their indirect property portfolios.”
Aberdeen currently manages approximately EUR2.5bn in European property multi-manager mandates, with further assets under management in Asia and the Americas.