Ping An set to invest “billions” through new US real estate arm

Chinese insurance giant "absolutely" looking at New York market: Singer

Ping An Real Estate
From left: Peter Ma and Rick Singer

Having ramped up its investment in global real estate markets over the past two years, the real estate arm of Chinese insurance giant Ping An is set to invest “billions of dollars” in the U.S. over the next several years – with New York City set firmly in its sights.

PARE U.S., Ping An Real Estate’s U.S. real estate investment arm, officially launched late last year with Rick Singer, former head of global real estate at Salomon Brothers, as its chief executive. The new venture will handle “all of the [real estate] investing for Ping An in the U.S. going forward,” Singer told The Real Deal.

“The purpose is to consolidate the decision-making and process of deal flow to a local basis, so that Ping An can be much more active in investing in the U.S.,” Singer said of the PARE U.S., which aims to differentiate itself from other Chinese forays into the U.S. real estate market through the “benefit of local expertise.”

The firm will not only focus on development projects but other forms of real estate investment, such as structured debt deals, asset portfolios and even entity-level acquisitions. It aims to invest “billions of dollars [in the U.S.] over the next two to four years,” Singer said. “To move the needle with Ping An, it takes that.”

Ping An’s U.S. real estate presence thus far has been outside of the New York market, having partnered, alongside fellow Chinese insurance giant China Life, with Tishman Speyer for a stake in the developer’s $500 million Pier 4 waterfront development in Boston.

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But Singer said the new venture is “absolutely” looking at New York as part of its strategy to invest in core urban areas – citing the city as “the biggest and most important” of those core markets. PARE U.S. is actively in “discussions with many of the large developers in New York,” he said, citing its “ongoing relationship with Tishman Speyer,” as well as conversations with the likes of Silverstein Properties.

“In building up this business, our focus is very much to do things off-market and quietly, based on relationships,” Singer noted. “To do it in a way where we’re very much like a U.S. investor, as opposed to a foreign investor.”

Ping An, China’s second-largest insurer with more than $700 billion in total assets under management, has made waves with the ventures into global real estate markets in recent years, having acquired two London office properties in deals valued at nearly $900 million.

It purchased the iconic, Richard Rogers-designed Lloyd’s of London building for $390 million in July 2013, and followed that with the acquisition of the Norman Foster-designed Tower Place for around $490 million last January.

With PARE U.S., however, the company looks set to follow Chinese insurance giants like Anbang Insurance Group and Fosun International in betting on U.S. real estate – and staking its claim in New York, as well.

“It’s a very smart move for Ping An to venture with local U.S. expertise in Rick Singer,” Eastdil Secured senior managing director Doug Harmon told The Real Deal. “I think it will for sure help them navigate the markets in a swifter, smarter fashion.”