CapitaLand announced that it has sold three retail malls in Japan and an office building in Korea for a total of S$448.7 million as part of its portfolio reconstitution strategy.
In Japan, CapitaLand has divested La Park Mizue and Vivit Minami-Funabashi in Greater Tokyo, as well as CO-OP Kobe Nishinomiya Higashi in Greater Osaka above valuation for a total of JPY 21.99 billion (S$283.6 million).
In August 2020, CapitaLand also divested ICON Yeoksam in Seoul above valuation for KRW 142.2 billion (S$165.1 million). CapitaLand held the office building through a private fund, Ascendas Korea Office Private Real Estate Investment Trust (REIT). CapitaLand remains the asset manager of ICON Yeoksam and will continue to receive fee income.
CapitaLand said with these divestments in Japan and Korea, the total gross value of the divestments by CapitaLand and its real estate investment trusts (REIT) would be S$3.02 billion, crossing its annual target of recycling S$3 billion of capital.
As at 30 November 2020, CapitaLand and its REITs have invested more than S$3.30 billion into new assets.
Capitaland enters Japan logistics sector
CapitaLand has also entered into a joint venture with Mitsui & Co. Real Estate Ltd, with CapitaLand as the majority partner, to develop and operate a logistics project in Greater Tokyo. This marks CapitaLand’s first foray into Japan’s logistics sector.
The development is close to Central Tokyo and easily accessible via the strategic Route 16 national highway. When completed in 4Q 2022, the four-storey modern logistics facility will have a gross floor area of about 24,000 square metres.
“The divestment of these mature malls and office asset is part of CapitaLand’s capital recycling strategy to unlock value by reinvesting the capital into new growth opportunities such as the logistics sector in Japan. By paring down our exposure in Japan’s retail sector and leveraging our logistics experience in markets such as Singapore, Australia and the United Kingdom to expand into the new economy sector in Japan, we are responding swiftly to shifting market trends and consumer behaviours, positioning CapitaLand for future growth,” said Jason Leow, President, Singapore & International, CapitaLand Group.
“The logistics sector in Japan presents significant opportunities for CapitaLand. The global pandemic has accelerated the growth of e-commerce and the logistics sector has been a prime beneficiary of this trend. Vacancy rates of the logistics sector in Greater Tokyo have reached a historical low of 0.4%. The logistics sector is set to continue its growth momentum as more customers transact online. We aim to achieve meaningful scale over time by leveraging Mitsui & Co. Real Estate Ltd’s local knowledge and access to business opportunities to grow our logistics portfolio in Japan,” said Gerald Yong, Chief Executive Officer, CapitaLand International.