LJ Partnership, a real-estate focused multi-family office backed by Hong Kong’s Peterson Group, plans to expand into Australia and Singapore – towards its ambitions to build into a global wealth management platforms – channeling the growing pool of Asian families’ capital into cross-border projects.
Andrew Williams, Partner and co-chairman said that LJ Partnership is aiming to grow its Asian assets under management from $1.5 bn today, to $10bn by 2021, after Gulf investor – the New York-based family office Dilmun – acquired a 40% stake in the company last month.
LJ Partnership will also rebrand itself to Alvarium Investments in 2019.
Williams refused to divulge Dilmun’s overall investment. Currently, LJ Partnership manages overall assets of $15 bn on behalf of family offices, foundations, charities and individuals across both real estate, and fixed income and equity securities.
“We want to reach the growth target for Asia-Pacific partly through opening new businesses in Australia and Singapore, and partly through acquisitions to build out our own in-house boutique investment capabilities that would include mergers and acquisitions, and subsequently private equity and technology,” he said.
Last month, Ken Costa, a former global head of M&A at UBS, joined LJ Partnership as partner and shareholder. In his most recent role as chairman of Lazard International, Costa had advised Egyptian billionaire Mohammed al-Fayed’s $1.9 bn sale of the Harrods department store to the Qatari royal family.
Based in London, Costa will now steer LJ Partnership’s boutique investment infrastructure, which will initially be focusing on Europe.
In expanding its global property investment portfolio, Williams– who himself is Auckland-based—said that LJ Partnership has invested US$50 mn in New Zealand since 2017. In Australia, where it expects to be operational in 2019, Williams stated that LJ Partnership plans to focus on senior secured financing to property developers — an area from which many banks have withdrawn in recent years because of regulations.
“The regulatory framework imposed on banks in Australia and New Zealand has left a large funding gap for lending outside those provided by the formal banking system. Borrowers now have to pay double-digit yield to senior lenders for loans, and we are happy to be in that space,” he stated.
Williams said that LJ Partnership invests about $500 mn to $ 1 bn in real estate each year across 20-plus transactions on average. LJ Partnership will often co-invest with other family offices or private equity investors.
In March 2017, LJ Partnership bought Generator Hostels, which runs 14 hostels in cities including London, Amsterdam, Miami and Barcelona, through subsidiary Queensgate Investments for $520.4 mn. Queensgate is a real estate private equity firm set up by LJ Partnership, the Peterson Group and Jason Kow.
In Singapore, LJ Partnership is obtaining regulatory approval to set up an office, which will become operational “in the next few months”. For now, the office will focus on acquiring new clients.
Tony Yeung, managing director of Peterson Group and a partner at LJ Partnership, said in China, Pradera, a fund manager in which LJ Partnership owns a stake, manages four retail properties in Chongqing, Shanghai, Qingdao and Xian through its joint venture with Macquarie Retail Real Estate Management.
Yeung said LJ Partnership was looking to also expand its presence in China, but he gave no concrete timeline regarding that.