The financialisation of Singapore’s real estate industry took another step forward on Monday as Frasers Property announced the creation of a new business unit aimed at raising and managing capital from institutions for investment in the company’s real estate initiatives.
The establishment of Frasers Property Capital was announced just over a year after shareholders in CapitaLand, which had been Southeast Asia’s largest public developer, voted to privatise the Singapore-based giant, as the company began focusing on earning fees from managing third-party investment in real estate strategies.
To lead its private investment management division, Frasers has recruited Wong Ping, a former CBRE Investment Management executive, to serve as chief investment officer, the company said in a release. Based at the Singapore headquarters, Wong joined Frasers Property in July and reports to chief corporate officer Chia Khong Shoong. Given the capital-intensive nature of the real estate industry, the group will need a strong capital base and diversified capital sources to execute on its strategic priorities, Chia said.
“Forming Frasers Property Capital now to work with aligned partners, as part of our wider asset and capital management strategy, is a natural evolution in our journey,” he said. “We look forward to having Ping lead and deepen our relationships with long-term capital partners, working alongside our business units.”
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In setting up its fund management business, Frasers, which is controlled by Thai liquor baron Charoen Sirivadhanabhakdi through his TCC Group, has turned to a veteran fund manager. Wong has more than 25 years of experience in real estate investment management, and her most recent position was as head of Asia indirect investments at CBRE IM, which she left in June after a more than four year stint.
Prior to setting up this private fund management business, Frasers has already been active in managing real estate investment trusts, with the company currently sponsoring three REITs, Frasers Centrepoint Trust, Frasers Hospitality Trust and Frasers Logistics and Commercial Trust.
From 2008 to 2017, Wong worked in fund selection and capital markets as one of the pioneering members of Allianz Real Estate’s Asia Pacific team. From 2002 to 2007, she served as vice president of the APAC investment management team at PGIM precursor Pramerica Real Estate Investors.
The 1996 business graduate of the University of Southern California spent the earlier part of her career in various roles at the Singapore offices of JLL, DTZ (now part of Cushman & Wakefield) and Edmund Tie.
Wong said she looked forward to bringing a focus on capital partnerships in geographies and sectors where Frasers Property has developed robust capabilities.
“The group has earned its reputation by purposefully growing its business where we have accumulated local and sector knowledge with the support of our tenants and customers,” she said. “This approach is complementary to how we intend to scale and align sustainably with our partners.”
FHT Privatisation Looms
Wong’s onboarding comes as Frasers Property is seeking to take private SGX-listed Frasers Hospitality Trust in an all-cash deal that values the REIT at S$1.35 billion ($970 million).
Also the trust’s sponsor, Frasers Property is offering S$0.70 in cash per share to take over the hotel and serviced apartment trust in line with a recent strategic review conducted by the REIT’s independent directors, citing the sector’s bumpy recovery, growing market uncertainties globally and the trust’s small size relative to its peers as factors precipitating the buyout.
The proposal requires approval from owners of at least 75 percent of the trust’s units at a scheme meeting expected to take place by the end of this month. Should the proposal win approval from investors and regulators, the trust would be delisted from the Singapore Exchange in the fourth quarter.
Comprising 14 hotels and serviced residences across Asia, Australia and Europe, FHT’s portfolio is valued at S$2 billion and includes the 406-room InterContinental hotel at Singapore’s Bugis Junction and a 380-unit Novotel in Melbourne. The trust also holds Fraser Suites serviced apartment complexes in Australia, Singapore and the UK.