[RFP] Korea Post plans to invest $200 mn in real estate mezzanine debt

Korea Post’s insurance arm is looking for one or two real estate debt managers to invest $200 million in mezzanine debt, for which it is planning to carry out on-site due diligence in the second stage of evaluation, according to its request for proposal issued recently.

Targeting a net internal rate of return of 6-8%, the mezzanine strategy will include mezzanine loan, B-notes and subordinated debts with focus on the US and Europe.

Both domestic and foreign asset managers are allowed to submit investment proposals by the deadline of August 19 by 5 p.m. (Seoul time).

Qualified managers must have at least five years of management experience in overseas real estate mezzanine funds. As for local asset management companies, they must have at least 300 billion won ($251 million) in assets under management.

In the second-phase evaluation process for shortlisted candidates, Korea Post will conduct on-site due diligence before finalizing the selection around October.

Last year, Korea Post’s savings arm picked the Blackstone Group and Principal Asset Management to invest a combined $150 million in real estate debt, half of the amount it had planned. The commitment was split into $100 million for Blackstone’s blind-pool real estate debt fund and $50 million to Principal Asset for mezzanine strategy.

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Source: http://www.koreaninvestors.com/?p=9376