M&G Real Estate Asia picks up stake in ESR’s Japan logistics fund

Photo: ESR

ESR Cayman, a Warburg Pincus-backed logistics real estate firm, announced on Tuesday that M&G Real Estate Asia has acquired a significant stake in a joint venture that owns the ESR Ichikawa Distribution Centre in Japan.

M&G acquired the stake on behalf of M&G Asia Property Fund, its core Asia property strategy, per the announcement. The fund, according to its 2020 prospectus, seeks to acquire real estate assets across the Asia Pacific region, with a primary focus on Japan, South Korea, Hong Kong, Singapore and Australia.

M&G Real Estate Asia bought the stake from ESR-managed Redwood Japan Logistics Fund II, which had previously roped in two unnamed investors in 2019. The sale values ESR Ichikawa DC at just over $870 million, making it one of the most valuable single logistics assets in Japan, ESR said.

The four-storey ESR Ichikawa DC, which was completed in 2019, is currently ESR’s largest building under operation in Tokyo at 201,100 sqm of net rentable area.

“This transaction is doubly significant as an endorsement of ESR’s proprietary product by one of Asia’s most discerning direct investors as well as a testament to the group’s continued ability to recycle development projects into long-term open-ended ownership mandates, and to maintain continuity with our invaluable tenant relationships,” said ESR co-founder and co-CEO Stuart Gibson.

ESR is the largest APAC-focused logistics real estate platform in terms of gross floor area (GFA) and value of the assets owned directly and through managed funds and investment vehicles.

ESR and the funds and investment vehicles it manages are backed by investors including APG, CPP Investments, JD.com, Oxford Properties, PGGM and SK Holdings. As of 31 December 2020, ESR had approximately $30 billion in assets under management.

In April, ESR acquired an asset in Japan’s Osaka to develop a data centre campus with a gross asset value of over $2 billion.  The asset comprises an existing data centre and excess land, totalling a development potential of up to 78MW IT load, ESR said in a statement.

Last year, ESR invested about 27 billion yen (equivalent to approximately $245 million) to develop ESR Yatomi Kisosaki Distribution Centre, which the firm says will be the largest modern logistics facility in Greater Nagoya, Japan.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.