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CapitaLand Forms Strategic Alliance With ERGO Trust, Financial Services Provider Of ERGO Insurance Group And Other Institutional Investors

Salient details

CapitaLand Commercial ("CCL"), Singapore's largest owner and manager of commercial real estate and a wholly-owned subsidiary of CapitaLand, has signed a Memorandum of Understanding (MOU) today to invest in Asia and Europe with ERGO Trust GmbH, a wholly-owned subsidiary of ERGO Insurance Group ("ERGO"). ERGO, Germany's second largest primary insurance group, is the holding company of several insurance companies which include VICTORIA, Hamburg-Mannheimer, DKV Deutsche Krankenversicherung AG and D.A.S. Rechtsschutzversicherung.

Under the terms of the MOU, ERGO Trust will raise capital from the ERGO Insurance Group and other German insurance institutions to co-invest with CCL. Likewise, CCL will contribute quality assets from its own sizeable portfolio and secure capital from other Asian institutions. 

This alliance with ERGO Trust, which has extensive real estate investment, fund management and financial services expertise in Europe and the United States, will give a boost to CapitaLand’s property fund management business. 

In the six months since its formation, CCL has invested in the Lend Lease International Distressed Debt Fund targeting investments in Asia. Earlier, CapitaLand Group had tied up with ING Real Estate to co-sponsor and co-manage IP Property Fund Asia, a S$300 million opportunistic fund investing in real estate in Hong Kong, Singapore, Thailand, Philippines, Malaysia and Indonesia. 


Perspectives of Senior Management

"We are pleased with this alliance with a major European financial services partner. It facilitates the direct investment of European capital into commercial properties in Singapore and paves the way for international investors to easily access other property assets in Asia. We look forward to the sharing of new ideas, products and services with ERGO Trust and being their key Asian partner for the creation and marketing of future investment opportunities. It is one of the several strategies for CapitaLand to intensify its financial services and products with real estate base." 
-- Liew Mun Leong, President & CEO, CapitaLand Limited.

"We are at the forefront of innovation. With this alliance, CapitaLand Fund Management will work closely with ERGO Trust to create suitable property funds and global products to satisfy Asian and European institutional and retail investor needs. Also, CapitaLand Commercial will work quickly to identify a portfolio of quality assets to cement the relationship." 
-- Ed Ng, CEO, CapitaLand Commercial Limited and CapitaLand Fund Management Limited. 

"This is a win-win opportunity. Partnering established Asian player CapitaLand is a logical step because of our similar investment objectives; and complementary strengths, skills and geographic presence. By pooling our resources and market knowledge together, we are better placed to seize investment opportunities in Asia and Europe for our Group, institutional partners and clients."
-- Frank-Rainer Vaessen, Managing Director, ERGO Trust GmbH


About CapitaLand Commercial 

CapitaLand Commercial's vision is to transform commercial properties into living communities for the benefit of customers, delivering a level of service exceeding expectations. It owns, develops and manages an extensive portfolio of commercial properties in Singapore and the region with an asset base of S$7.7 billion. 

In Singapore, CapitaLand Commercial is the largest manager of office, retail and industrial space, with a portfolio of 10.9 million square feet (i.e. 1 million square metres) of net lettable area in total. Overseas, it has investments in several key gateway cities including Shanghai, Hong Kong, Tokyo, Kuala Lumpur and London.

CapitaLand Fund Management works closely with CapitaLand Commercial to identify attractive and stable assets for injection into new property funds to meet the risk-return profiles of local and international investors.

CapitaLand Commercial and CapitaLand Fund Management are business units of CapitaLand Limited, Southeast Asia’s largest listed property company with assets of about S$19 billion, spanning 54 cities and 23 countries.


About ERGO Trust GmbH

ERGO Trust is a wholly-owned subsidiary of public-listed ERGO Insurance Group. The major shareholder of ERGO Insurance Group is Munich Re. One of ERGO Trust’s main business objectives is the evaluation, creation and marketing of investment opportunities in international real estate. Part of this is the packaging of real estate investment products such as wholesale property funds, and offering them to both insurance companies and insurance policy-holders for investment. 

With a strong focus on managing funds from institutional investors, ERGO Trust now has more than 30 institutional investors among its clients. Together with its sister company, MEAG MUNICH ERGO AssetMananagement GmbH, ERGO Trust manages directly and indirectly funds of total value exceeding EURO 11 billion for external third parties. 


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