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Allianz and Alpha propose €1bn Asia-Pacific real estate joint venture

Allianz and Alpha propose €1bn Asia-Pacific real estate joint venture

Magic Circle law firm Slaughter and May is advising real estate investment management firms Alpha Investment Partners (Alpha) and Allianz Real Estate (Allianz) on a proposed joint venture worth approximately €1 billion. Under the terms of the agreement, Allianz and Alpha Asia Macro Trends Fund III, managed by Alpha, will acquire an 85% stake in Beijing Ronsin Technology Center, a grade A office complex in Wangjing, Beijing.

The vendor is China-based park owner and operator D&J China, which will preserve the remaining 15% interest in Beijing Ronsin Technology Center. Allianz, one of the investors in the fund, will retain a 62% share of the joint venture.

On completion of the deal, the office complex will be jointly operated by all three parties.

The Ronsin Technology Center build, which was completed in March 2018, comprises six office towers and two retail podiums. It is located next to an assortment of technology companies. Allianz Asia-Pacific CEO Rushabh Desai commented that “Wangjing is a well-established sub-market for technology and innovation firms, which is experiencing persistent demand with tight supply”.

He continued: “This is a continuation of Allianz’s investment strategy to allocate 50-60% of its Asia Pacific real estate exposure to fast-growing markets such as China and India. Beijing is demonstrating strong resilience to current volatility in the global markets.”

D&J China’s CEO Mr Sun Dong Ping remarked in a statement: “This partnership is a remarkable endorsement to the quality and value of our property assets, our proven business model and our strong asset management capabilities.”

“D&J China is very pleased to enter into this strategic partnership with Allianz and Alpha Investment Partners. We are very proud of Ronsin Technology Center, which has become one of the landmark assets in the Wangjing sub-market.”

For Allianz, this investment is both its second in Beijing and which it is the joint asset manager, having acquired a 98% stake in grade A office complex ZLink in Zhongguancun in 2018.

Whilst both the joint venture agreement and the sale and purchase agreement have been completed, it is anticipated that the transaction will fully close towards the end of 2019.