Singapore’s Government of Singapore Investment Corporation (GIC), the eighth largest sovereign wealth fund (SWF) with total AUM of US$345 billion, has purchased a 35% stake in a Brazilian shopping mall, Via Parque Shopping.
GIC said in a statement that the fund has entered into an agreement with the country’s second largest listed mall developer, Aliansce Shopping Centers SA to purchase the majority stake in the shopping mall for for US$41.89 million.
The mall is located in a prime area to the west of Rio de Janeiro and has a gross leasable area of 56,802 square meters. The mall underwent renovation in 2013 and 2014 to improve its retail environment. GIC said that the acquisition reflects its confidence in the long-term growth prospects of the Brazilian retail sector.
GIC is striving to advance its penetration of Latin America with the opening of its 10th overseas office in April 2014. GIC Group president Lim Siong Guan previously noted that its presence in Brazil is an important step for the fund’s strategy to be present in key financial capitals around the world.
GIC’s main focus on the continent is on investment in real estate, healthcare, financial and business services. In late 2014, GIC purchased an office building in Rio de Janeiro for an undisclosed amount from local private equity real estate fund manager, Hemisfério Sul Investimentos (HSI).
According to GIC’s latest financial report, about 4% of the fund’s investment was sourced from Latin America in the 2013/14 fiscal year ending March 31, 2014.
According to the 2015 Preqin SWF Review, alternative assets such as infrastructure and real estate have emerged as an increasingly important portion of the portfolios of many SWF investors over recent years. It stated that the proportion of global SWFs investing in real estate and infrastructure were 59% and 60% respectively in 2014, compared to 54% and 57% in the previous year.
The report also indicated that SWFs based in Asia represent the largest proportion of capital by region, accounting for 44% of the industry’s AUM in 2014. However, this represented a slight decrease to the 47% reported the previous year.
