JL Family Office unveils boutique property investment firm

Singapore

JL FAMILY Office has launched a boutique property investment firm, The Land Managers Holdings, with S$250 million initial capital commitment.

It is on the lookout for value-add and developmental real estate opportunities in Singapore and gateway cities in Europe and Greater China.

Its maiden acquisition is a corner, 999-year leasehold shophouse at 65 Club Street bought for S$15.7 million. The deal was completed last month and the property, spanning three storeys and a mezzanine level, will be spruced up and serve as the new office of both The Land Managers and JL Family Office.

While the The Land Managers remains keen on opportunistic investments at home, the near-term priority would be to spread its wings overseas.

Its founder, Andy Lim, told BT that in Europe, the firm is eyeing the residential property market in the UK and Germany, with the focus on the gateway cities of London, Munich and Berlin.

"The UK residential market has pulled back quite a bit over the past couple of years. In Germany, things have been more stable. There is a very big leasing culture in Europe and interest rates are very low - so there is opportunity to get decent yield."

Besides buying completed properties, The Land Managers is open to developing residential assets and leasing them.

In Greater China, the company will target investments in Shanghai, Beijing, Chongqing, Guangzhou and Hong Kong - with the focus on logistics, residential, and suburban shopping malls.

"The global macroeconomic environment remains challenging - and yet the low cost of capital and unprecedented level of stimulus from governments around the world have been propping asset values across various asset classes.

"Despite this, we believe there are still pockets of opportunities in key gateway cities in the value-add space with investment ticket sizes of between S$20 million and S$50 million, which are perfect for The Land Managers," said Mr Lim, who is also the group chief executive officer of JL Family Office.

The S$250 million initial investable capital for The Land Managers is from the internal resources of Mr Lim's family.

JL Family Office is the investment holding group of companies set up by Mr Lim's father, John Lim, in 2011. The senior Mr Lim, 65, is most famous for co-founding ARA Asset Management in 2002, of which he continues to be group CEO and executive director.

The real assets fund management group was privatised and delisted from the Singapore Exchange in 2017. JL Family Office has a stake of 20.41 per cent in ARA Asset Management. The other shareholders are Warburg Pincus, The Straits Trading Company, and CK Asset Holdings.

Said the 35-year old Mr Andy Lim, who is a lawyer by training: "My father told me from a very early stage in my career that while he co-founded ARA , it was never meant to be a family business. But you know, in Singapore, people always have this notion about an Asian family business that is attached to its founders.

"There'll be a time when my father retires from ARA. We may then either sell our stake completely or leave it as a passive investment."

So the family decided to try and do something more along the lines of a family business, with continued longer-term involvement.

"We thought about what we want to do as a family, what business lines we want to create. With our in-house property talent, we decided to mint The Land Managers as a separate branding for our boutique real estate investment firm under the family office."

JL Family Office will still be the overarching group and continue to engage in other business activities as well - including investing private equity in mezzanine funding structures as a limited partner; and playing the role of venture capitalist, providing early-stage investing in tech start-ups.

"The Land Managers will be purely on real estate," said Mr Andy Lim.

The travel restrictions amid the ongoing pandemic have held him back from investing in overseas properties. But he hopes to deploy some capital overseas by first-half 2021.

The Land Managers will work with partners in each of the overseas markets to manage assets with local expertise. Where relevant, these local partners will also put some skin in the game and make a small co-investment in the asset.

Said Mr Lim: "With the initial S$250 million that the family has put into The Land Managers, if I can get good gearing on it, say, 50 per cent or 60 per cent loan to value, I can grow this pot quite nicely.

"My vision is that hopefully, in the next five to 10 years, we can grow this business steadily."