Mapletree Industrial Trust proposes to acquire Tokyo freehold mixed-use property for JPY14.5 bil
The recommended purchase is made under the conditional trust beneficiary interest purchase and share contract with Nagayama Tokutei Mokuteki Kaisha, an unrelated third-party vendor. Under the structure, MINT will have an efficient economic interest of 98.47% in the real estate with a procurement expense of JPY14.9 billion. The balance of the acquisition consideration will be funded by MINT’s supporter, Mapletree Investments.
The proposed procurement is projected to take place by the 4th quarter of 2024.
With solid need and restricted supply development, the information centre space is anticipated to expand at a compound annual growth rate (CAGR) of 9.3% from 2023 to 2033, states MINT’s manager referring to data from DC Byte’s Japan information centre market report for this year. The similar report notes that the job price is anticipated to tighten to 6% by 2033, from 9% in 2023 and 23% in 2018.
It will certainly likewise enhance MINT’s geographical diversification with its Japan portfolio up by 1.3 percentage points to 6.4% from 5.1% as at June 30. MINT’s Singaporean and North American estates will certainly represent 47.3% and 46.3% specifically.
Developed in October 1992, the building rests on freehold land determining around 91,200 sq ft. The real estate has a gross floor location of around 319,300 sq ft.
Additionally, the proposed acquisition grabs options in Japan, which has over 5,000 megawatts of overall IT supply and is Asia-Pacific’s (APAC) third-largest information centre market.
Mapletree Industrial Trust (MINT) is proposing to get a multi-storey mixed-use facility in Tokyo, Japan for JPY14.5 billion ($129.8 million).
The estate is presently completely leased to a Japanese group and has a measured common lease to expiry (WALE) of five years. The present lease is a traditional ordinary one where the occupant has the choice to continue its lease.
Following the proposed acquisition, MINT will have 65.9% of freehold real properties in its portfolio, up from the percentage of 65.8% as at June 30. Its profile will certainly grow to $9.1 billion by assets under management (AUM) up from $9.0 billion as at the same duration.
According to MINT, the real estate remains in a strategic site, which provides a future redevelopment opportunity that develops added value.
The consideration exemplifies a discount rate of some 3.3% to the real estate’s appraisal of JPY15.0 billion. The property was alone valued by JLL Morii Valuation & Advisory K.K.
The establishment features an information facility, back office, training facilities and a surrounding rental wing that has the likely for being redeveloped into a multi-storey information centre.
“End-users and data centre providers have expanded into brand-new information hub clusters throughout Greater Tokyo because the restrictions of land and power and the need for better redundancy. These caused West Tokyo becoming a bigger submarket, that made up around 40% of overall live IT supply in Greater Tokyo market,” the REIT manager describes in its Sept 30 news.
On a historical pro forma basis, the proposed purchase and its proposed strategy of financing are going to be accretive to MINT’s distribution per unit (DPU). The manager means to fund the total expense through Japanese yen (JPY)-denominated borrowings to “provide an all-natural capital hedge”. MINT’s accumulation leverage ratio is expected to increase to 39.8% from 39.1% as at June 30.
