US fund manager Franklin Templeton plans to invest heavily across the Asia-Pacific region aims to launch a new Asian property fund of funds. It also intends raising about $300 million from institutional investors in Europe and Australia, a Reuters report said.
The new fund might try to offer investors an annualized return of 15 per cent after taxes and fees, said Glenn U'ren, a managing director at Franklin Templeton Real Estate Advisors.
If net returns exceed 10 percent, the real estate advisors, which currently have about $4.5 billion invested with about 90 funds globally, will earn performance fees too.
As of now, he was looking to invest the money in private equity funds that specialize in buying non-performing loans tied to property investments in Japan.
Mass residential housing in China and India had also caught his eye. His third and final strategy was asset repositioning which involved buying poorly managed commercial property that he could work upon.
After 12 months, new strategies could arise, he said.
He added that he was wary of high-end residential in any of China's coastal cities, as prices rose sharply over the past 2-3 years.
He maintained that segments of China's real estate market appeared quite optimistic at the moment and that there might not be any sharp correction, as many investors had deep pockets and could ride out a downturn in the property market.
Unless you have to give your keys back to the bank, you are still in the game, Reuters quoted him saying in its report.