The fund, ERES APAC II - China Outlets, will be 30 percent anchored by Allianz and backed up by investors including TH Real Estate, who will act as the fund’s manager.
According to Allianz, the fund is part of the firm’s diversification strategy, including allocating 5 percent of its global real estate portfolio to the Asia Pacific (APAC) region.
In August, Allianz partnered with Keppel Group to acquire Shanghai's Hongkou SOHO for $525 million, investing in the Alpha Asia Macro Trends Fund III.
ERES APAC II - China Outlets will initially acquire two outlets, Florentia Village, between Tianjin and Beijing, and Florentia Village, Shanghai. It has a number of additional assets in the pipeline.
The deal is an extension of the relationship between Allianz and TH Real Estate, which established a similar European platform in 2004 and a UK platform in 2008.
TH Real Estate currently has $2.4 billion in assets under management in the Asia Pacific (APAC) region. RDM Asia will manage the assets.
Rushabh Desai, APAC CEO of Allianz Real Estate, said: “China is moving towards a services- and domestic consumption-led economy. Alongside the traditional ‘bricks and mortar’ retail formats, outlet malls have been successful in attracting buyers looking for branded products at discounted prices.”
Chris Reilly, managing director for APAC at TH Real Estate, added: “The success of this first close demonstrates the wide appeal of our China Outlet Mall strategy, offering investors an exclusive opportunity to invest in premier designer outlet malls in China. We have seen this niche sector continue to gain in popularity with China’s brand conscious consumers.”