ASIA - Jones Lang LaSalle has set up Asia's first platform for trading secondary interests in non-listed real estate funds.
The firm described the Secondary Market Bulletin (SMB) as an "evolution in indirect real estate markets" for a region with potentially $250m of available ‘secondaries'.
Ashley Marks, finance director at JLL Corporate Finance, attributed the timing of the launch to fund managers' growing comfort with the idea of secondary trading.
"International fund managers - global brands - are comfortable with the concept of the secondary market, recognising that happy investors make for an easier life," he said.
"Handholding helps the process because fund managers recognise that we're facilitating liquidity, and that we're not after the underlying assets."
Secondaries in Asia are becoming easier to price because funds reaching maturity have drawn most, if not all, of their equity. At the same time, a paucity of new funds to invest in, due to a challenging capital raising market, has led investors to re-evaluate their portfolios with a view to liquidity.
"There aren't many new funds, so investors are looking to access the secondary market as the next logical step for allocating," said Marks.
"We're giving investors visibility not only of what the fund's units would trade at but also of the underlying assets."
Marks said JLL was "increasingly active" with both fund managers and underlying investors when funds were facing key events such as fund extensions.
He added that partners typically found it easier to navigate recapitalisations and fund restructurings with the involvement of a non-participating adviser.
The pan-Asian platform will initially have a significant Australian contingent. "Aggressive domestic buyers and a lack of available fund information have made it difficult market for overseas investors to access," said Marks.
"It resembles the UK in the sense that it has a small number of very active core investors who are quite knowledgeable in their approach."
