Bahrain's GFH sets up US operations with SQ deal

Investment bank acquires majority stake in Atlanta-based property management company

Manama, Bahrain. GFH's global investment portfolio includes assets in health care, education and logistics. Reuters

Bahraini investment bank GFH Financial Group set up its US operations by acquiring a majority stake in Atlanta-based SQ Asset Management, which focuses on student housing.

Under the agreement, the Gulf company will add 180 property professionals to its employee base, “bringing significant investment and asset management experience in US real estate”, it said on Monday.

The financial details of the agreement were not disclosed.

“[The deal] provides us with direct access to the attractive living space and provides the group with local and well positioned access in the US to help execute our real estate strategy,” said GFH chief executive Hisham Alrayes.

Hisham Alrayes, GFH’s chief executive. Razan Alzayani / The National

“This investment is in line with GFH’s strategy of growing its presence globally by partnering and acquiring leading and well-established platforms with strong market reputations in Europe and North America,” he said.

[The deal] provides us with direct access to the attractive living space and provides the group with local and well positioned access in the US to help execute our real estate strategy

Hisham Alrayes,
chief executive of GFH

GFH has an investment portfolio across the world in a number of sectors, including health care, education and logistics.

It closed more than $1 billion worth of new investments across the region in international logistics, health care and education in 2021. Its assets grew by about 23 per cent to $8.08 billion at the end of last year.

“With the support and backing of GFH, we strongly believe in our ability to unlock further growth at SQ and execute on our clear plan to triple our assets under management,” SQ chief executive Andy Feinour said.

“We have grown our client base and assets under management … and we are confident we will significantly build on this by benefitting from GFH as our strategic partner.”

Founded in 2013, property manager SQ has more than $1.4bn in aggregate transaction value, with 32 housing properties and 10,300 beds currently under management across the US.

Its investment strategy is to acquire and manage high-quality student housing assets at large public US universities and drive value through operational efficiencies and capital upgrades.

After the transaction, GFH joins SQ's other owners in the shareholding structure. They include the company’s founders, a large global alternative investment company that manages about $51bn in assets and TriPost Capital Partners, a US-based private equity business.

“We are looking forward to working with SQ … and enabling the platform to expand into other sectors and geographies,” Mr Alrayes said.

“Having recently completed portfolio acquisitions with SQ in excess of $300 million of purpose-built student accommodation affiliated with top-rated universities in the US, we look forward to working closely with our new partners to broaden GFH’s asset under management … [and] target a global institutional investor base.”