MERRILL Lynch & Co, the securities firm being bought by Bank of America Corp, has raised US$2.65 billion for its first fund dedicated to Asian real-estate investments.

The company made the announcement yesterday in an e-mailed statement obtained by Bloomberg News.

Merrill Lynch Asian Real Estate Opportunity Fund aims to invest in real-estate assets or property companies in the region, with a focus on Japan, China, South Korea and India. It will also invest in Australia and Southeast Asia.

Investors have continued to pump money into real-estate funds even as a global credit crisis that began with United States subprime mortgage defaults saddled financial firms with more than US$630 billion of losses and writedowns since the beginning of 2007.

LaSalle Investment Management recently received US$3 billion for a fund to invest in Asian property and expects to double its holdings in the region in three years.

"We see exceptional opportunities in Asian real estate over the medium and longer term," Tim Grady, head of Merrill Lynch's Pacific-Rim Global Commercial Real Estate division, said in yesterday's statement.

Investors that have committed capital to the Merrill Lynch fund include pension funds, endowments, foundations and private individuals in North America, Europe, the Middle East and Asia.

Deutsche Bank AG's RREEF, the largest alternative asset manager, had doubled investments in real estate, infrastructure and private equity in Asia Pacific over the past two years, Kurt Roeloffs, Asia head of RREEF Alternative Investment, said in June.

He said then he expected growth in Asian assets to outstrip other regions.

The region's property markets have been buffeted by recent financial turbulence.