Hong Kong-based asset manager PACM Group Holdings Ltd. and local financier Oi Wah Pawnshop Credit Holdings Ltd. plan to launch a private credit fund together with a focus on real estate, as more players expand into direct lending in the Asian financial hub.
Pacific Aegis Capital Management and its Hong Kong-listed partner will target a fund size of $300 million, a PACM spokesperson told Bloomberg News. Oi Wah, which owns pawnshops in the city, will act as the “anchor investor” and will provide initial capital for the fund, according to an earlier press release.
The dollar-denominated private credit fund is poised to launch in late July, Francis Ng, a managing director and chief investment officer of PACM Group, told Bloomberg News on Tuesday. “The opportunity set has enlarged from a year ago given the uncertainty in the current macroeconomic environment,” he added.
The asset manager plans to invest in debt secured by real estate assets in developed markets such as Hong Kong, Singapore and Australia, Ng said. The strategy includes stretch senior financing and bridge financing, as well as other structured credit products, he said.
The potential fund may be part of a trend as investors seek opportunities in private credit in the region, with Allianz Global Investors and BlackRock Investment Institute both saying last month that they expect the market to receive a boost from the global banking rout. Funds raised a record $11.2 billion in private credit in Asia last year, according to a report from the Global Private Capital Association, with deal values also increasing.
“The global markets are on a recovery period and if our assets do fall into liquidation or enforcement scenarios, we would be properly timed for our follow-on exit for the collaterals that are secured against our loans,” Ng said.