As the havoc wreaked by the COVID-19 pandemic continues to weigh on the global economy, Hong Kong-based private equity major Gaw Capital Partners is poised to capture turnaround deals in real estate, including in the hospitality sector, that could start hitting the market in the first half of 2021.
Distressed opportunities may come about when governments’ monetary support expires, and lenders face downgrades on risk profiles approaching their year-end valuations, said Kenneth Gaw, president and managing principal of Gaw Capital, during an opening keynote chat at DealStreetAsia’s Asia PE-VC Summit 2020.
“Obviously, the biggest impact of the COVID is on hospitality. There is no real escape from that for whoever in the hospitality industry and pretty much wherever they operate from,” he said.
Real estate-focused PE powerhouse Gaw Capital was co-founded by Gaw and his elder brother Goodwin in 2005. The firm mainly invests in under-utilised real estate projects worldwide, spanning the residential, commercial, hospitality, and industrial sectors.
Gaw Capital has two vehicles dedicated to investments in the hospitality sector, including a pan-Asia Hospitality Fund, which was fully committed; and a European Hospitality Fund that already deployed about 40 per cent of its capital pool. The firm also invests in hotel properties through its flagship Gateway Real Estate Fund series.
Since its inception 15 years ago, Gaw Capital has raised six commingled funds targeting the Greater China and Asia-Pacific regions. Apart from the two hospitality funds, it also manages value-add/opportunistic funds in Vietnam and the US and provides services for separate account direct investments globally.
As of Q2 2020, the firm has garnered equity of $15.6 billion with assets of $26.7 billion under management. Its latest flagship fund, Gateway Real Estate Fund VI, the firm’s largest vehicle to date, was closed at a hard-cap of $2.2 billion in December 2019.
Edited excerpts of the interview with Kenneth Gaw:
