Alpha, Keppel Land and unnamed investor acquire $525m Shanghai asset

A real estate fund managed by Keppel Capital and an unnamed institutional investor are co-investing in a mixed-used property development in Shanghai for about US$525m (€429m).

Alpha Asia Macro Trends Fund (AAMTF) III, managed by Keppel Capital subsidiary Alpha Investment Partners, and the unnamed investor will own 40% and 30%, respectively.

The remaining 30% will held by Keppel Land China, another subsidiary of the Singapore-listed Keppel Corporation.

Hongkou Soho, a 70,042sqm office and retail tower on the fringe of Shanghai’s central business district, was sold by developer Soho China.

The building was completed in 2015 and is nearly fully leased to tenants including Panasonic and China Pacific Insurance.

Christina Tan, chief executive of Keppel Capital and managing director of Alpha, said that, as the financial and commercial hub of China, Shanghai has seen the need for more high quality and well located developments in the city.

Alpha Investment Partners launched AAMTFIII last year, and is seeking to raise US$1bn. The fund is due to have its final close this year.

“The strategic partnership between Alpha and Keppel Land China is testament to our commitment to grow our asset management business and achieve the best returns for our investors, in keeping with our disciplined investment approach,” Tan said.

Ang Wee Gee, chief executive of Keppel Land and chairman of Keppel Land China, said: “This is the second time that Keppel Land China and Alpha are harnessing strengths across the Keppel Group.”

Alpha previously co-invested with Keppel Land China to develop a sprawling shopping complex in Shanghai, which it was said generated an internal rate of return of 20% when sold in September last year.

Ang said the latest “acquisition is also in line with our strategy to scale up in high-growth cities, such as Shanghai, where Keppel Land China has established a firm foothold”.

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