WASHINGTON, DC–The Savings Bureau of Korea Post, the Teachers Insurance and Annuity Association of America (TIAA), Prudential Life Insurance Co. and New York Life Insurance Co. have agreed to create a blind pool worth 1 trillion won ($886,127,272) in which they will buy senior mortgage bonds backed by office buildings in such cities as New York and Washington DC, according to a report in the Maeil Business News, a national newspaper.
Korea Post will finance half of the fund, with the rest of the capital provided by the US investors.
According to the Maeil, investors are expecting yields of 5% per annum.
Meritz Real Estate Asset Management, Samsung SRA Asset Management and Hana Asset Management will manage the fund for the Savings Bureau while TIAA, Prudential and New York Life Insurance will run the US side.
Last year another South Korean fund launched to invest in US core markets. Samsung Life Insurance Co.'s real estate asset management subsidiary Samsung SRA debuted in October its first US office mezzanine debt fund which was oversubscribed at $270 million.
This flow of foreign funds will only continue, according to new stats [PDF] from Preqin. Two-thirds of a survey of over 180 real estate fund managers say they intend to deploy more capital over the next 12 months compared to the previous year, and almost half are planning to invest significantly more.
At the same time, though, they expect they will have to lower their return expectations as a result of such challenges as increases in pricing and fewer available assets.
WASHINGTON, DC–The Savings Bureau of Korea Post, the Teachers Insurance and Annuity Association of America (TIAA), Prudential Life Insurance Co. and
Korea Post will finance half of the fund, with the rest of the capital provided by the US investors.
According to the Maeil, investors are expecting yields of 5% per annum.
Meritz Real Estate Asset Management, Samsung SRA Asset Management and Hana Asset Management will manage the fund for the Savings Bureau while TIAA, Prudential and
Last year another South Korean fund launched to invest in US core markets. Samsung Life Insurance Co.'s real estate asset management subsidiary Samsung SRA debuted in October its first US office mezzanine debt fund which was oversubscribed at $270 million.
This flow of foreign funds will only continue, according to new stats [PDF] from Preqin. Two-thirds of a survey of over 180 real estate fund managers say they intend to deploy more capital over the next 12 months compared to the previous year, and almost half are planning to invest significantly more.
At the same time, though, they expect they will have to lower their return expectations as a result of such challenges as increases in pricing and fewer available assets.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
