AXA IM Alts grows Japanese real assets portfolio to €2.6bn

AXA IM Alts grows Japanese real assets portfolio to €2.6bn
Serenite Esaka, Osaka Image:Courtesy of AXA IM Alts

AXA IM Alts has acquired a portfolio of two residential assets in Osaka, Japan, from PGIM Real Estate Japan for ¥10.6 billion (c.€82 million).

AXA IM Alts said the acquisition increases its Japanese real assets portfolio to c.¥337 billion (€2.6 billion).

The portfolio consists of two well-located residential buildings offering a total of 346 studio to four-bedroom apartments for the rental market.

The first property, located in the Nishi Umeda district of Osaka, contains 214 apartments with a total lettable area of c. 10,000 sqm. Known as Zeus Nishi Umeda, the high-specification asset boasts bespoke interior design, a 70-space car park and presents a range of floor plans which support a diverse tenant base. Nishi Umeda is an affluent residential area just 1km from Osaka’s CBD. It benefits from easy access to the city’s thriving retail hub of Shinsaibashi, as well as the key office districts of Umeda, Honmachi and Yodoyabashi new subway station that will deliver city-wide access to commuters is scheduled to open in 2031.

The second asset, Serenite Esaka, comprises 132 prime studio and one-bedroom apartments as well as four fully-let retail units, spread across c. 4,000 sqm of space. Serenite is just a three-minute walk from Esaka subway station, which provides direct access to Osaka’s main commercial districts, as well as connecting to a bullet train station with national rail links, making the area popular with frequent travellers.

Osaka has the second highest GDP of any Japanese city (c.¥39 trillion or c.€300 billion) and a population of 8.9 million. The city has attracted a number of major global businesses and is a renowned hub for commerce and innovation. Osaka has experienced steady population growth over the past two decades, supporting residential occupancy levels of over 90% since 2008. A number of ambitious infrastructure projects, including a new subway line, are in the pipeline and are expected to support the city’s continued economic growth in the years to come.

This acquisition forms part of AXA IM Alts’ wider long-term strategy to invest into residential asset classes which it believes are supported by strong demographic drivers.

AXA IM Alts has a c.€23 billion global portfolio of residential assets under management spread across 15 countries.

Laurent Jacquemin, Head of Asia-Pacific at AXA IM Alts, commented: “The acquisition of this portfolio presents an exciting opportunity to capitalise on both Osaka’s continued population and economic growth, which have been driving the residential market. Both of these well-connected assets have a strong track record of high occupancy and appeal to the city’s thriving community of professionals and young families.”

“AXA IM Alts has made a number of acquisitions in Japan in the past year, taking our total real assets AUM in the country to c.¥337 billion (€2.6 billion). Our recent investment activity in Japan is testament to its residential market’s dynamism and its potential to deliver strong returns for our clients,” he added.