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Singapore’s Temasek Holdings emerged as the world’s most active sovereign wealth fund from January 2016 through June 2017, according to new report published by Spain’s IE Business School.
According to the Sovereign Wealth Funds 2017 report, Temasek was involved in 101 deals during the period, accounting for 30 percent of the overall global volume. This was followed by the city-state’s GIC (63) and the Abu Dhabi Investment Authority (23), which respectively made up 19 percent and seven percent of the total deal count.
In ninth spot is Malaysia’s Khazanah Nasional, which only took part in nine transactions (three percent).
The report revealed that Temasek “continues to focus on long-term opportunities in key growth sectors such as technology, life sciences, non-bank financial services and e-commerce. Its target sectors expanded from eight percent to 24 percent of its portfolio holdings through 2016, while the US has remained a major destination for its capital”.
“As of 2017, GIC had 34 percent of its portfolio invested in the US, followed by 12 percent in the Eurozone and six percent in the UK. This was consistent with its allocations in 2016 and despite mounting political pressures, including the continued uncertainty arising from the June 2016 Brexit vote.”
Based on latest data from to the Sovereign Wealth Fund Institute (SWFI), GIC’s total asset value reached US$359 billion in June 2017 compared to US$350 billion in June 2016. As of 31 March 2017, Temasek posted a record net portfolio value of S$275 billion up from S$242 billion a year earlier.
In addition, the report showed that sovereign wealth funds (SWFs) prefer to invest in technology and real estate. In fact, the former accounted for 24.3 percent of their investments in 2016 and 26.1 percent for H1 2017. Real estate made up 21.5 percent and 23.9 percent respectively.
During the 18-month period, the biggest real estate deals executed by sovereign wealth funds were not for a luxury hotel or landmark skyscraper — they were multi billion-dollar bids for various commercial warehouses scattered across Europe.
For instance, GIC acquired P3 Logistics Parks for US$2.5 billion last December, and six months later China Investment Corp purchased Logicor for US$14 billion, setting a new record for the biggest property deal transacted by a single SWF.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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