Berkeley Assets expands into six new overseas markets
Dubai and London-based private equity firm Berkeley Assets will expand into six new overseas markets in 2019 off the back of highly satisfying results achieved last year despite challenging market conditions.
Omar Jackson and Mike Clark, Partners at Berkeley Assets, said today that the company will open new offices in Mexico City, Moscow, Cape Town, Hong Kong, Singapore and Marbella during the course of this year.
The company, which has raised more than US$500 million capital, with significantly larger assets under management (AUM), chose the six new markets based on their high population of expatriates with disposable incomes.
“We see much more positivity in the 2019 outlook compared with 2018, which was a phenomenal year for private equity, although it wasn’t without challenges,” said Jackson.
“To begin with, there was the uphill climb to compete with a bumper year in deal flow in 2017. Another challenge was the level of unspent capital seen in private equity funds as the buying frenzy continued across global markets.”
With offices in Dubai and London, Berkeley Assets raised US$112.8 million in total in 2018, with US$16.2 million generated from the retail market and the remainder from institutional investors, far exceeding its capital raising targets.
“This has allowed us to take on long term hold projects that provide focused stable returns,” added Clark. “One highlight has been the greater than expected growth that we have seen from our affordable housing projects in the UK.”
“Our biggest win was our increased market share of the development finance and bridging loan sector in the UK. Our deal flow was up 60% from 2017 and we achieved higher returns from our loan portfolio by utilising our substantial capital reserves to participate in larger projects.
“Meanwhile, the acquisition of our blockchain technology business, Cryptech World, allowed us to participate in a high growth industry with a small portion of our capital. This is looking very exciting for 2019, with the some big headline projects in the pipeline.”
Since establishing its MENA regional base in Dubai in 2017, the firm has invested heavily in educating the market about private equity, which is composed of funds and investors that directly invest in private companies, or engage in buyouts of public companies.
“More and more people are starting to understand the benefits of private equity and leaning towards those options for personal investments,” said Jackson. “There is more faith in PE these days because it is outperforming every other aspect of the finance industry and is the most trusted sector.”
With investments in real estate, hospitality, logistics and technology, Berkeley Assets expects private equity firms to turn their attention to more creative strategies in 2019, and to spread risk by buying more minority investments, thereby increasing the number of deals done.
“This will serve to diversify away from the current risks seen in the global economic climate,” said Jackson. “We also anticipate significant buying opportunities in the wake of Brexit and have increased our capital reserves so that we are poised to take advantage of short term volatility in the UK. This could allow us to achieve very strong growth over the medium to long term.”
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