The Carlyle Group is shaking up its real estate team as the firm rethinks its Asian investment strategy.
Adam Metz, Carlyle’s former head of international real estate, has left the firm. And Jason Lee, its Hong Kong-based head of Asia real estate, is on his way out, sources told Bloomberg.
A Carlyle Group spokeswoman declined to comment, but the changes come just four months after co-chief executive officers Glenn Youngkin and Kewsong Lee replaced co-founders David Rubenstein and Bill Conway. The new executives want to focus Carlyle’s Asian real estate investment on China, sources said.
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Historically, Carlyle’s Asian real estate investments have been far smaller than its investment in the U.S. and Europe. Since October 2016, it has been investing a $120 million fund known as Carlyle China Realty. Before that, it invested two Asia-focused funds that manage $900 million worth of assets in Seoul, Tokyo and Shanghai.
Carlyle is raising its first European real estate fund since it closed Carlyle Europe Real Estate Partners III, a $3.4 billion fund, in 2008. (Its second fund, Carlyle Europe Real Estate Partners II, lost 80 percent of its value due to losses in recession-hit countries like Italy and Portugal.) So far, the third fund has delivered a net internal rate of return of 1 percent.
Carlyle’s global real estate funds appreciated 17 percent in 2017, trailing behind its private equity and natural resources funds, according to an investor presentation last month.
As of Dec. 31, Carlyle’s real estate funds managed more than $18 billion in assets across 11 active funds, according to its website. [Bloomberg] —E.B. Solomont