ESR Cayman Limited and M&G Real Estate Asia have announced the acquisition of a significant stake in the Singapore-domiciled joint venture which owns ESR Yatomi Distribution Centre, by M&G on behalf of M&G Asia Property Fund, its APAC core direct real estate fund with US$5.9 billion as at 30 June 2021 in assets under management.
M&G has bought a 40% interest in a prime logistics facility in Japan’s Nagoya area worth approximately JP¥10bn (US$91 million).
ESR said the partial sale by ESR-managed Redwood Japan Logistics Fund II and Redwood Investor (Kawajima) Ltd values ESR Yatomi DC at well over US$200 million.
”ESR, M&G and a continuing JV investor see ESR Yatomi DC as ideally positioned to deliver long-term investment value against the backdrop of secular growth in Japan logistics real estate investment and occupier markets,” said ESR in a statement.
ESR Yatomi DC, which was completed in 2018, is a state-of-the-art, multi-let, four-storey sloped facility with a net rentable area of approximately 95,000 sqm.
It is located in Yatomi City, Aichi Prefecture, a prime distribution submarket of Nagoya favoured by leading e-commerce companies and 3PLs for its close proximity to major transport systems, including the Nagoya Port.
The asset is currently fully leased to six tenants including leading third-party logistics providers.
The CASBEE A rated ESR Yatomi DC is built with solar energy production maximised at 2,300 KW and is fitted with energy efficient equipment. The facility also provides ancillary services to workers, including a child day care centre (BARNKLÜBB) and a staff lounge (KLÜBB Lounge).
Stuart Gibson, Co-founder and Co-CEO of ESR, and Richard van den Berg, M&G Fund Manager, stated: “We are very pleased to be deepening the relationship between ESR and M&G across Asia Pacific. The Yatomi transaction marks the second collaboration this year in the Japanese market, following the recent closing of ESR Ichikawa Distribution Centre in April 2021.”
Richard van den Berg said: “Asian logistics has long been identified as a key investment theme for our fund and we are looking forward to further JV-type investment opportunities with ESR across the region as we increase logistics exposure to our higher target weighting. We share the same views with ESR on where Asian gateway cities real estate is headed with secular demand for property serving sustainable e-commerce and logistics solutions supporting them.”