Alternative asset manager Ares SSG, which is a pan-Asian unit of Ares Management Corporation, has purchased a 51% stake in New World Development’s Hong Kong office project for around $392 million (HK$3.07 billion), per a regulatory filing.
A fund under the management of Ares SSG had formed a joint venture with the HKEX-listed developer, led by real estate tycoon Adrian Cheng, in a late-stage investment for the construction, development and sale of a 28-storey commercial complex in Cheung Sha Wan district of Hong Kong.
The 33,760-square metre project, which broke ground in 2017, is still under construction. The developer’s responsibilities also include property management, asset management and sales of units upon its expected completion in late 2023.
“We are excited to join hands with one of the leading property developers in Hong Kong on a project with great potential. Real estate has been one of the key sectors during our long and successful investment history across 12 Asia-Pacific markets,” said Edwin Wong, managing partner and CEO of Ares SSG, in a company release.
“We look forward to working with NWD and leveraging our extensive experience in real estate investing in the region,” Wong added.
The announcement comes less than two months after Ares’ Asia-Pacific arm welcomed industry veteran Bryan Southergill as partner and head of real estate to its Hong Kong office. With over 23 years of experience in private equity real estate investments, Southergill formerly served as managing director of the Asian property divisions at JP Morgan and KKR & Co, respectively.
“Our close collaboration with Ares SSG and other business partners will forge the first grade-A commercial complex in the core business district of West Kowloon,” said Edward Lau, chief financial officer, New World Development. “Not only will this meet the burgeoning demand for grade-A office buildings in the district, but it will also breathe a new dynamic into the development of West Kowloon,” he said.
Ares SSG, formerly known as SSG Capital until the acquisition of the US buyout giant in 2020, has been eyeing pandemic-induced distressed assets in Asia, including turnaround opportunities in the property sector, the firm told DealStreetAsia in an exclusive interview in May.