BentallGreenOak (BGO) has announced the final closing of its largest-ever Asia-focused real estate fund, centered on a value-add investment strategy. The fund, which has raised over $2.3 billion, will focus on transforming underutilized assets across Asia-Pacific into sustainable, high-performing properties.
Major Fundraising Milestone
The newly closed BGO Asia Real Estate Partners IV secured $2.35 billion in total investor commitments as of May 2025, surpassing its original fundraising target. According to BGO, the fund is now the largest Asia-focused value-add vehicle in the company’s history.
Investors include more than 30 institutional groups from North America, Europe, the Middle East, and Asia—ranging from sovereign wealth funds to pension systems, insurers, and university endowments.
What Is a Value-Add Strategy?
Value-add real estate investments involve acquiring properties that require significant upgrades, repositioning, or redevelopment to unlock higher returns. These projects typically carry more risk than core real estate but also offer greater return potential.
Common value-add approaches include:
- Renovating outdated offices and shopping centers
- Enhancing lease structures and rental income
- Improving building energy efficiency and ESG compliance
- Optimizing property operations and management
Geographic Focus
The fund will target high-liquidity urban markets throughout Asia-Pacific, including:
- Tokyo (Japan) – commercial towers and older apartment buildings
- Seoul (South Korea) – office repositioning and hospitality assets
- Singapore – logistics, commercial, and business park upgrades
- Sydney and Melbourne (Australia) – mixed-use and infill development
- Hong Kong and Taipei – residential redevelopment and coworking hubs
Opportunities in Southeast Asia (Thailand, Vietnam, Indonesia) will also be selectively considered.
ESG as a Core Priority
BGO emphasizes sustainability as central to its value-add approach. Each asset will undergo independent ESG review to ensure compliance with green building standards, decarbonization potential, and social impact.
Target certifications include LEED and BREEAM, with a focus on:
- Energy-efficient retrofits
- Recycled and sustainable materials
- Climate adaptation features
- Positive community engagement
Executive Commentary
John Park, Head of Asia at BGO:
“We are seeing strong demand for transformative real estate in key Asian metros. These opportunities allow us to unlock value while contributing to the long-term vitality of urban centers.”
Jessica Tan, Partner and Fund Manager:
“Value-add isn’t just a strategy—it’s about actively shaping the built environment. We aim to deliver financial returns and meaningful community impact.”
Projected Returns
The fund targets 13–15% internal rate of return (IRR) over a 5–7 year horizon. Most investments will be co-executed with experienced local partners.
Risk mitigation includes diversification by sector and geography, as well as currency hedging.
Building on Past Success
This fourth Asia-focused fund follows the strong performance of BGO Asia Real Estate Partners III, which closed in 2021 with $1.4 billion. That fund successfully delivered value through projects in Singapore, Seoul, and Osaka—including logistics redevelopments and office repositioning.
Its performance played a key role in attracting robust investor demand for Fund IV.
Market Context
The momentum in Asia’s value-add space is driven by:
- Depressed asset prices post-pandemic
- Changing work models and flexible leasing
- Higher tenant expectations on sustainability and design
- Urban population growth and housing shortages
According to JLL, value-add investment in Asia rose by 28% in 2024 and is projected to continue rising in 2025.
Institutional Appeal
Fund participants benefit from:
- Access to off-market, high-barrier investment opportunities
- ESG-aligned diversification
- Exposure to dynamic economies and urban transitions
- Return potential in both income and asset appreciation
Pension funds and sovereign investors cite the fund’s ESG profile as a key reason for their commitment.
Conclusion
BGO’s record-setting Asia value-add fund signals a new era for institutional real estate investment in the region. With a strategic focus on ESG transformation, urban revitalization, and cross-border expertise, the fund positions BGO as a leader in shaping the next generation of high-performance properties across Asia-Pacific.
For investors seeking impact and yield, value-add strategies like this offer a compelling path forward.
