CapitaLand sells three Japanese malls to invest in logistics
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Capitaland has divested three malls in Japan and an office building in South Korea for a total of S$448.7 million, as part of its ongoing portfolio reconstitution strategy, it said Tuesday morning in an exchange filing. It also announced that it has made its first foray into Japan’s logistics sector, entering into a joint venture with Mitsui & Co Real Estate, with CapitaLand as the majority partner, to develop and operate a logistics project in Greater Tokyo.
The divested properties in Japan are La Park Mizue and Vivit Minami-Funabashi in Greater Tokyo, as well as CO-OP Kobe Nishinomiya Higashi in Greater Osaka, which were sold for a total of 21.99 billion yen (S$283.6 million).
It also divested ICON Yeoksam in Seoul for 142.2 billion won (S$165.1 million) in August this year. The office building was held through a private fund, Ascendas Korea Office Private Real Estate Investment Trust (Reit) 5. CapitaLand remains the asset manager of ICON Yeoksam and will continue to receive fee income.
CapitaLand said the divestments were done above valuation, and the buyers are unrelated third parties. Post divestment, CapitaLand will retain S$3.8 billion of assets under management (AUM) in Japan and S$2 billion of AUM in Korea.
With the divestments, the total gross value of divestments by CapitaLand and its real estate investment trusts (Reits) would be S$3.02 billion, crossing its annual target of recycling S$3 billion of capital.
CapitaLand and its Reits have invested more than S$3.3 billion into new assets as at end-November.
“The office building was held through a private fund, Ascendas Korea Office Private Real Estate Investment Trust (Reit) 5.”
“The divestment of these mature malls and office assets is part of CapitaLand’s capital recycling strategy to unlock value by reinvesting the capital into new growth opportunities such as the logistics sector in Japan,” said Jason Leow, president, Singapore & International, CapitaLand Group.
“By paring down our exposure in Japan’s retail sector and leveraging our logistics experience in markets such as Singapore, Australia and the United Kingdom to expand into the new economy sector in Japan, we are responding swiftly to shifting market trends and consumer behaviors, positioning CapitaLand for future growth,” he added.
CapitaLand’s new logistics venture in Japan is close to Central Tokyo, and is expected to be completed in Q4 2022. The four-story logistics facility will have a gross floor area of about 24,000 square metres.
Gerald Yong, chief executive officer, CapitaLand International, said the logistics sector in Japan presents “significant opportunities” for CapitaLand.
“The global pandemic has accelerated the growth of e-commerce and the logistics sector has been a prime beneficiary of this trend,” Mr Yong said. “We aim to achieve meaningful scale over time by leveraging Mitsui & Co Real Estate’s local knowledge and access to business opportunities to grow our logistics portfolio in Japan.”
Questions & Answers
Q.What was the total value of assets CapitaLand sold in Japan and South Korea?
What was the total value of assets CapitaLand sold in Japan and South Korea?
CapitaLand divested three malls in Japan and an office building in South Korea for a combined total of S$448.7 million. The Japanese malls sold for 21.99 billion yen, and the South Korean office building for 142.2 billion won.
Q.Which specific Japanese malls did CapitaLand sell and where are they located?
Which specific Japanese malls did CapitaLand sell and where are they located?
CapitaLand sold La Park Mizue and Vivit Minami-Funabashi, both located in Greater Tokyo. They also divested CO-OP Kobe Nishinomiya Higashi, which is situated in Greater Osaka. These sales were part of their portfolio restructuring.
Q.What is CapitaLand's strategy behind these divestments and new investment?
What is CapitaLand's strategy behind these divestments and new investment?
The divestments are part of a capital recycling strategy to unlock value and reinvest into new growth opportunities, specifically the logistics sector in Japan. This allows them to respond to shifting market trends and consumer behaviours.
Q.When is CapitaLand's new logistics facility in Greater Tokyo expected to be completed and what are its dimensions?
When is CapitaLand's new logistics facility in Greater Tokyo expected to be completed and what are its dimensions?
The new four-storey logistics facility in Greater Tokyo is expected to be completed in Q4 2022. It will have a gross floor area of about 24,000 square metres, marking CapitaLand's first foray into Japan's logistics sector.
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