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Warburg Pincus raises $2.8bn for ‘new economy real estate’ fund

The fund is one of the largest ever first-time dedicated real estate funds globally and the second largest active opportunistic real estate fund in Asia.

By João Marques Lima

Founder and Editor, The Tech Capital

4 Mins

December 23, 2021 | 5:00 AM GMT

Warburg Pincus raises $2.8bn for ‘new economy real estate’ fund

Ellen Ng, Managing Director and Head of China Real Estate at Warburg Pincus. Source: Warburg Pincus

Global private equity firm Warburg Pincus has closed the raising stage of the Warburg Pincus Asia Real Estate Fund, L.P. with a committed capital of US$2.8 billion.

The fund will be a standalone fund, focusing on investing in asset-level real estate opportunities in Asia in partnership with real estate developers, operators and entrepreneurs.

It will be used to buy and develop real estate assets in Asia with a focus on “New Economy real estate” including logistics, data centres, IT office, life science parks, and multifamily real estate.

The Fund will also invest in the repositioning of underperforming or obsolete real estate assets as well as those in special situations.

Jeffrey Perlman, Managing Director and Head of Asia-Pacific Real Estate and Southeast Asia at Warburg Pincus, said: “We are deeply grateful for the trust and support of our limited partners.  This inaugural fund marks a major milestone for our Asia real estate business and further reinforces our position as the ‘partner of choice’ for real estate developers and operators in the region.

“As we start to deploy the capital at scale, we look forward to leveraging the firm’s deep experience, strong record and robust ecosystem across the region.”

Warburg Pincus has been investing in Asia real estate companies and platforms for over 15 years through its main global funds and China-SEA-focused companion funds.

It is one of the largest and most active investors in Asia real estate, with over $6.5 billion invested in more than 40 real estate ventures including platforms which Warburg Pincus co-founded such as ESR, Vincom Retail, PDG, DNE, and BW Industrial.  

Warburg Pincus Asia Real Estate Fund was launched in November 2020, initially targeting a fund size of $1.5 billion.

The Fund received commitments in excess of the $2.5 billion hard cap set during the fundraise and completed a final close at $2.8 billion.

Over 60% of the capital raised was from leading institutional investors in Asia, according to Warburg Pincus.

The limited partners that have committed to the fund include existing investors in Warburg Pincus’ funds and new investors to the firm, including public and private pension funds, sovereign wealth funds, insurance companies, endowments, foundations, and high-net-worth individuals.

Perlman added: “We are currently witnessing a once-in-a-generation change in real estate driven by technology where leading global investors are seeking to rebalance their portfolios by investing more capital into New Economy real estate where they have been meaningfully underweight.

“As a thought leader in New Economy real estate in Asia, Warburg Pincus is well-positioned to help investors tap into the firm’s expertise to gain this critical exposure going forward.”

Also commenting, Ellen Ng, Managing Director and Head of China Real Estate at Warburg Pincus, said: “As a firm we have always been very thesis-driven, which allows us to identify fast-growing sectors early on and ahead of capital flows.

“Our ability to leverage insights of other sector groups in our private equity franchise has been a key differentiator as most deals now cross geographies and sectors. 

“Our understanding of where technology and healthcare are headed and impacting the use of real estate has anchored our investments to date and will continue to help us identify new angles to increase exposure in the New Economy asset classes.”

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João Marques Lima

Founder and Editor, The Tech Capital

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