Mitsubishi Estate's new fund to target greater Asia
Japanese developer teams up with Hong Kong's CLSA to invest $1.8bn
TOKYO -- Mitsubishi Estate will launch a fund to invest in office buildings and commercial facilities in Asia and Australia, with the goal of managing 200 billion yen ($1.79 billion) in assets in four years.
The Tokyo-based real estate developer has set up a joint venture with a unit of Hong Kong investment bank CLSA. The venture will select properties and manage the fund -- the first Asian real estate investment fund created by a major Japanese real estate company.
For the first two years, Mitsubishi Estate will pour its own money into acquiring office buildings and other properties in Singapore and Australia. In the following two years, the joint venture will solicit contributions from such third-party investors as pension funds and insurers to increase assets under management to 200 billion yen. The fund will target an annual yield of 5-8%.
Mitsubishi Estate's properties are mainly Tokyo-area office buildings, such as the Marunouchi Building high-rise. But as the national population shrinks, Japanese demand for buildings is seen declining.
To secure growth, the company seeks to broaden its earnings base in greater Asia. It will also target properties in Hong Kong, Taiwan and mainland China, and logistics facilities will make up part of the portfolio.