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SYDNEY-Lend Lease Corp. Ltd. has raised $243 million for its new Asian Retail Investment Fund. The dollars will be invested primarily in the Singapore retail market but also may invest in Malaysia, Taiwan and Thailand.
Approximately 90% of the equity is coming from institutional investors both here and abroad who like Singapore's favorable growth outlook and transparent regulatory environment. Lend Lease is putting up the remainder.
"We have seen an emerging appetite for investment opportunities in Asia," says Steve McCann, Global CEO of Lend Lease Investment Management.
The goal of the fund is to create a portfolio of retail/mixed-use, greenfield and brownfield development opportunities. Using 60% to 80% leverage, the fund will be able to make $1.17 billion of investments. No less than 75% of the equity will be invested in Singapore, according to Lend Lease. The expected annual rate of return is 15%.
The fund's inaugural deal will be to acquire a 75% stake in the Somerset Central development site in Singapore from Lend Lease. Lend Lease describes Somerset Central as one of the last remaining major retail development opportunities along Orchard Road in Singapore.
The 420,000-sf development has planning consent from the Singapore Urban Redevelopment Authority. ARIF will engage Lend Lease to develop the center. The project is scheduled to commence in early 2007 and be complete in 2010.
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