Hines has acquired the New Stage Yokohama office building in the Yokohama submarket in the Greater Tokyo area.
The asset was purchased off-market on behalf of the firm’s flagship fund, Hines Asia Property Partners (HAPP).
The fund has made its first investment in Japan.
Built in 1993, New Stage Yokohama is a 17-story tower, providing over 500,000 square feet of office space. The building features expansive indoor and outdoor common areas, a large tenant dining area, an atrium-style lobby, a tenant sky lounge, and large column-free floor plates. The existing tenancy includes a diversified group of high-quality tenants from real estate, technology, R&D, automotive and financial services sectors.
A significant renovation effort is underway to revitalize the building to appeal to both traditional and R&D users. Details of the renovation plans will be announced at a later date after consultation with the existing tenants and the City of Yokohama. Renovations are expected to commence in Q1 of 2022 with completion by mid-2023.
Hines said Yokohama is an attractive market for long-term investment. Located just 30 kilometers from Tokyo Station, the city is the second largest in Japan and home to 3.8 million people. With the highest millennial population and the highest concentration of technical universities outside of Tokyo, the city offers employers exceptional access to a talented labor pool.
“This asset represents a significant milestone for Hines as we continue to grow our presence in the region and throughout Japan,” said Drew Huffman, managing director at Hines. “We look forward to revitalizing this asset over the coming year and providing our tenants with Grade-A office space complete with additional amenities, enhanced building features, and significant outdoor activation.”
HAPP is a new Pan-Asian fund Hines launched in April 2021. The fund closed on its first investment in September, a 275,000-square-foot fully leased office at 50 Ann Street, Brisbane, Australia.
“As we begin to build our exposure across Asia, we are excited to add New Stage Yokohama to our fund’s portfolio,” said Simon Shen, HAPP fund manager at Hines. “This asset is situated in an urban location with a strong tenant mix and fits well into HAPP’s approach of investing in assets with solid current income and strong value creation potential. Across Asia, we are continuing to see opportunities to acquire high-quality assets in major cities. We look forward to continuing to grow and diversify our portfolio with new acquisitions in markets where long-term growth prospects are attractive.”