MANILA -- Japanese property giant Mitsui Fudosan and Rockwell Land, a local mid-size real estate developer, are partnering on a condominium project in the Philippines.
Mitsui Fudosan, which is entering the Philippine real estate sector for the first time, will be involved in the development of three residential towers as part of Rockwell's The Arton project in northeastern Metro Manila.
The partnership will give Mitsui Fudosan a 20% equity stake in the 9 billion pesos ($177.5 million) mixed-use project, according to a statement announcing the signing of a joint venture over the weekend.
The Arton is on a 1.9 hectare site. The three towers, which range from 24 to 34 floors, will have a total of 1,700 residential units. The first tower will be launched later in July.
Japanese real estate companies are looking for opportunities abroad, particularly in Southeast Asia, where economic growth is faster. Mitsui Fudosan has projects in Malaysia, Singapore, Thailand and Indonesia, as well as in other markets such as China, the U.S. and U.K.
The Rockwell-Mitsui Fudosan partnership is the second link-up by Japanese and Filipino developers within a week. On July 10, Federal Land, the real estate unit of conglomerate GT Capital Holdings, unveiled a $400 million commercial and residential project in Metro Manila with Nomura Real Estate Development and Isetan Mitsukoshi Holdings.
The moves capitalize on Filipinos' fondness for almost anything Japanese. The Philippines is one of the fastest-growing tourist source markets for Japan because of rising disposable income. Last year, Filipinos visiting Japan rose by nearly 30% to around 350,000, according the Japan National Tourism Organization.
The Japanese companies are entering the Philippines at a time when condominium prices in Metro Manila are barely growing. In the first quarter, prices rose only 0.8% from a year ago, according to the Philippine central bank.
However, Rockwell, which is chaired and controlled by the family of Manuel Lopez, former Philippine ambassador to Japan, was optimistic about the venture.
"We are honored that Mitsui Fudosan chose to partner with us in their first foray in the Philippines," said Rockwell Land president Nestor Padilla. "We hope that this will be the beginning of a long and fruitful partnership with them."