Hong Kong-based CLSA has formed a strategic partnership with Avignon Capital to pursue investment opportunities in Europe.
The deal marks the initial phase of expansion into Europe for CLSA’s Asia-based real estate investment business.
The primary reason for the move is to fulfil investor demand for investment in Europe.
CLSA, the international platform of China’s largest investment bank, CITIC Securities, said with significant capital inflows into Europe over the past two years, and an optimistic forecast for strong economic growth, the outlook for the European real estate investment market was positive,
John Pattar, the CEO of CLSA Real Estate, told IPE Real Assets that CLSA’s focus will be on the UK, Germany, the Netherlands, Spain and Portugal.
Pattar singled out the commercial and hotel as sectors of greatest interest to CLSA.
He said Avignon would be both the co-investor and facilitator of deals.
“Avignon will continue to originate, invest and manage opportunities that are invested by a range of private clients and institutional investors,” he said.
The partnership will create an expanded European real estate investment management platform, with Avignon Capital acting as CLSA’s partner for European commercial real estate investment.
The partners aim to create future institutional investment products, including club deals, joint ventures and separate accounts, Pattar said.
CLSA’s CEO, Jonathan Slone, said the partnership builds on the existing CLSA real estate platform, including the successful Fudo Capital series of pan-Asia real estate funds.
CLSA had chosen to partner with Avignon Capital because of its innovative approach and track record in European property investment, identifying and investing in leading European cities such as Berlin, Copenhagen and Amsterdam.
Avignon Capital’s managing partner, Patrick Flaton, said: “Avignon Capital will benefit from a combined 50 years of experience that CLSA and CITIC Securities bring, along with their access to institutional investors from Asia and the US.”
Flaton said the partnership would enable further growth, and open new markets for Avignon Capital.
“And this is the next important milestone for Avignon Capital, positioning us for longer-term growth and expansion.”
Last September, Avignon Capital expanded into Australia on the back of investor interest in the country’s office and hotel assets.
It said then that it had received a new mandate to invest in Australia and would target Sydney, Melbourne and Brisbane.