19 Dec, 2011 -
Global Logistic Properties Ltd. and sovereign-wealth fund China Investment Corp. are jointly buying 15 Japanese logistic properties for about US$1.6 billion, in one of the biggest property deals in Japan. LP, majority-owned by sovereign-wealth fund Government of Singapore Investment Corp., and CIC are buying 770,989 square meters of properties from a unit of real-estate firm Jones Lang LaSalle. Each will get a 50% stake in the joint venture, GLP said in a statement Monday. The properties, focused on distribution and warehousing uses, are owned by LaSalle Investment Management and are mainly located in the greater Tokyo area and in Osaka, the company added. According to data from Nomura Securities, the acquisition would mark the biggest property investment in Japan since Secured Capital’s purchase of the Pacific Century Place building in Tokyo in 2009 for ¥140 billion, or $1.8 billion at current exchange rates.
In a statement, LaSalle Investment Management said the deal marked the sale of all but two properties held by its US$1.6 billion Japan Logistics Fund and reaps “strong returns” for the fund’s institutional investors. The transaction will be funded with about ¥81 billion in debt and about ¥42.4 billion in equity contribution, GLP said. The Singapore-based firm will fund its equity commitment with internal resources, while the joint venture will raise the debt component through a group of domestic Japanese banks. GLP will explore other collaborations with CIC as well as opportunities with other large sovereign-wealth and pension funds like GIC and the Canada Pension Plan, GLP Deputy Chairman Jeffrey Schwartz said in a conference call. He declined to elaborate on these plans.
GLP, which owns, manages and leases 380 completed properties across China and Japan, will act as the manager of the venture, providing asset- and property-management services, it added. The deal would expand GLP’s Japan portfolio by about 30% to 3.6 million square meters. The deal is expected to be completed in the first quarter of 2012, Jones Lang LaSalle said in a statement.
(Source – “The Wall Street Journal”)