Allianz (ALVG.DE) plans to boost real estate investment in China, announcing on Friday the launch of a $750 million fund that targets malls in major cities such as Shanghai and Beijing.
The German insurer and asset manager is betting high-end outlet shopping in China will continue to grow despite threats from online stores and a slowing economy.
Allianz Real Estate, Allianz’s $63.5 billion property investment arm, launched the China-focused fund in partnership with investor TH Real Estate. Allianz will be the anchor investor owning 30 percent of the fund.
“China will become one of the top markets for us in Asia,” Rushabh Desai, Asia-Pacific CEO of Allianz Real Estate, told Reuters in a telephone interview.
He expects to grow Allianz’s real estate portfolio in China to more than 1 billion euros ($1.18 billion) over the next 12 months, from around 760 million euros by the end of this year. Last year, the number was just 100-150 million euros.
Foreign investors such as Allianz remain optimistic about China’s real estate market despite Beijing’s tougher property curbs and a slowing domestic economy.
On Wednesday, Canadian asset manager Manulife Asset Management launched an investment unit in Shanghai, seeking to help foreign institutions invest in Chinese commercial real estate and infrastructure through co-investment deals. UBS Asset Management is also considering launching a real estate fund in China.
“Even if there is a slowdown, China still has 5-6 percent annual GDP growth, right? In my mind, 5-6 percent growth is still one of the best growth in the world,” Desai said.
Source: Reuters
