Asia’s second largest hedge fund manager, Tokyo-based SPARX Group, plans to raise up to USD100million over the next year for a real estate fund that will invest in companies building t
Asia’s second largest hedge fund manager, Tokyo-based SPARX Group, plans to raise up to USD100million over the next year for a real estate fund that will invest in companies building temporary hotels in areas of the country afflicted by the devastating earthquake and tsunami in March, reported Reuters this week. The relocation fund, according to SPARX president and chief executive, Shuhei Abe, will aim to return annualised returns of 15 per cent. It will begin life with USD5million to USD10million in AUM when it launches next month. Abe said there would be an absolute “supply and demand gap” created in the region as a result of the carnage inflicted, saying: “People need houses and need storage space and those are not supplied. That situation should continue for a while.”
He estimates that more than 100,000 people remain homeless in the quake-hit area. Construction workers will also need places of shelter during the reconstruction phase, creating investment opportunities that Abe said could earn double-digit returns. To further grow the business, Abe said that the firm aims to launch mutual fund operations in South Korea by end-2011 or early 2012. Having applied for a mutual fund license, Abe believes assets in Korean-based Cosmo Investment Management – part of SPARX Group – will grow by as much as 25 per cent (USD1billion) in the next twelve months.
