State-owned Qatari fund set for more deals-analysts

* Diar looking for more revenue generating deals -analysts

* Fund seen looking at deals outside real estate

By Dinesh Nair and Regan E. Doherty

DOHA/DUBAI, April 22 (Reuters) - Wealthy and seemingly unscathed by the global crisis, Qatari real estate firm Diar is expected to invest boldly and hunt for big stakes while other Gulf sovereign investors follow a more conservative approach.

Diar, the property arm of the Gulf state's sovereign wealth fund Qatar Investment Authority (QIA), recently embarked on an aggressive investment strategy, buying stakes in assets ranging from luxury hotels to global utility firms. [ID:nLDE63F08I]

Analysts and industry experts say the relative newcomer to the investment game will seek bigger stakes than other Gulf sovereign wealth funds, reaching beyond its core real estate remit to increasingly consider other international deals.

"I don't think from an investment standpoint any particular sector will be excluded from their consideration," said Khuram Maqsood, managing director at Emirates Capital in Dubai.

Last week, Diar agreed to take a 5 percent stake in Veolia Environment (VIE.PA). Earlier this month, it bought a 40 percent stake in hotel chain Fairmont Raffles from Kingdom Holding 4280.SE in a deal valued at $847 million. [ID:nLDE634034]

Diar also signed a deal with Cyprus on Wednesday to develop a hotel, office and residential complex in the capital Nicosia, targeting rising numbers of visitors to the east Mediterranean island. [ID:nLDE63K024]

Qatar's economy is projected to grow 16 percent in 2010, with the state expecting a budget surplus of 9.7 billion Qatari riyals ($2.7 billion). It has been pouring billions of dollars into infrastructure, real estate and education projects.

"They (Diar) have probably been very active lately because they have a lot of money to spend," said one Doha-based analyst who did not want to be named.

Diar, which counts London's Chelsea Barracks among its most high-profile overseas assets, has more than 80 projects worldwide worth about $60 billion, Qatari Diar's Chief Executive Ghanim bin Saad Al Saad said last year.

NEW TO THE GAME

One of the things that distinguishes Diar from many of its regional counterparts is its relative newness, a factor which affects its investment strategy, analysts say.

Diar was set up in December 2004 to support Qatar's economic development, mainly in real estate.

"You cannot compare Diar or QIA to other sovereign funds in the region. Qatar entities are new compared to other institutions and all their investments are considered new," said Thamer Jadallah, head of investments at Almana Group in Doha.

Being new also means Diar's investment strategy will continue to evolve and the firm may look at opportunities outside its core areas, the same as other, new Gulf investors who are either sovereign or sovereign-linked, such as Abu Dhabi-based Aabar AABAR.AD.

"There is an opportunistic culture that informs their investment activities, which is why you sometimes see an inconsistency between the portfolio holdings and the stated strategy," Emirate's Maqsood said.

"For example, a company like Aabar, mainly set up to make energy-related investments, is buying stakes in ... Chrysler and Virgin Galactic," he said.

More deals can be expected soon, particularly overseas and not just in North Africa, but in developed countries as well, analysts say, noting its investment destinations may reflect overseas visits by Qatar's Emir Sheikh Hamad bin Khalifa Al-Thani.

"Where the Emir goes, Qatari Diar goes," the Doha-based analyst said.

The Emir has recently visited France, Brazil, Argentina and other Latin American nations.

Qatar Investment Authority is one of the world's largest sovereign wealth funds with an estimated $60 billion or more in assets under management. Its investment arm has stakes in British supermarket chain J Sainsbury (SBRY.L), bank Barclays (BARC.L), the London Stock Exchange (LSE.L) and Credit Suisse (CSGN.VX). (Editing by Thomas Atkins and David Holmes) ($1=3.638 Qatari Riyals)