This Singaporean private equity firm is looking to raise USD1bn
This Singaporean private equity firm is looking to raise USD1bn
It already holds hotels, beach villas, and office buildings in Australia, Japan, South Korea, and Thailand
SC Capital Partners, a Singapore-based private-equity real estate firm, is planning to fund-raise USD1 billion by early next year. This is in response to a stronger clamour worldwide for real estate and other assets riskier than bonds, whose yields have dropped to record lows.
“There are a number of office buildings, hotels and other properties in the region which have potential for good investment returns,” SC Capital chairman and founder Suchad Chiaranussati told Bloomberg. “With a low-yield environment, most of our existing investors have expressed a strong desire to participate in the next fundraising.”
SC Capital has around USD5 billion in holdings, which include hotels, beach villas, and office buildings in Australia, Japan, South Korea, and Thailand, among other countries. The firm is particularly keen on the growth of hotel properties in Japan, after tourist arrivals reached 14 million this year, according to the Japan National Tourism Organisation.
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However, “it’s much harder to acquire hotels in Japan at attractive prices compared with when we first invested there right after the tsunami-earthquake incident in 2011,” Suchad noted.
Government bonds have sold at negative yields at auctions in countries such as Japan and Germany. Similarly, the 10-year Treasury note in the US plummeted to a record low in July.
Fitch Ratings reported that global investors are foregoing more than USD500 billion in annual interest income on around USD38 trillion in outstanding sovereign debt. “Cash flow benefits have effectively been transferred from global investors to sovereign issuers, as sovereign borrowing costs have dropped in response to central bank monetary stimulus,” the ratings agency stated last month.
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Source: Property Report