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Bahrain’s Investcorp plans Saudi real estate deal before year-end

Office Building, Building, Architecture Bahrain News Agency
A potential global economic slowdown will open up many tactical opportunities for private equity firms in 2023

Bahrain-based Investcorp plans to close a Saudi real estate deal before the end of the year, senior executives at the alternative investments firm said on Thursday.

The acquisition of warehouses in Saudi Arabia will be announced in the coming weeks, the executives told Reuters, without giving any details on the size of the investment.

Investcorp, which had $10 billion in real estate assets under management at the end of June, has followed a strategy of investments into real estate sub-sectors which have shielded its portfolio from global market volatility and Covid-19.

“We decided years ago to see what are the sub-sectors of real estate that we should be in. Covid was really a big test for our portfolio, and its resilience,” Mohammed Alardhi, executive chairman of Investcorp, told Reuters.

“We concentrated on these sectors of family accommodation, which is a huge market in the United States, and industrial type of real estate,” he said in an interview during Abu Dhabi Finance Week.

Rishi Kapoor, Investcorp co-chief executive added that there is growing awareness among corporates globally to develop more resilient supply chains, fuelling opportunities for investments in logistics distribution centres and warehouses for example.

Investcorp, which has $43 billion in assets, is growing its business in the Gulf Cooperation Council (GCC) region and Asia, but will stay committed to the US market.

“It is a tough environment, with geopolitics, rising rates, inflation, but we continue to see opportunities, we continue to invest. We are doing more in the Gulf,” Alardhi said.

Investcorp led a $67 million investment earlier this month in India’s Global Dental Services, its fourth healthcare investment in the country.

It is also committed to China. In October, the company announced a $500 million fund with Fung Capital to be based out of Hong Kong and invest in mid-cap companies across China’s Greater Bay Area.

“Long term, nothing has changed in the fundamentals for China. We continue to invest in China,” Alardhi said, adding Investcorp will focus on technology, healthcare and consumer-related businesses there.