Mapletree Industrial Trust proposes to acquire Tokyo freehold mixed-use property for JPY14.5 bil
Mapletree Industrial Trust (MINT) is proposing to get a multi-storey mixed-use center in Tokyo, Japan for JPY14.5 billion ($129.8 million).
On top of that, the recommended procurement catches chances in Japan, which has over 5,000 megawatts of total IT supply and is Asia-Pacific’s (APAC) third-largest data centre market.
The estate is presently totally rented to a Japanese conglomerate and has a weighted standard lease to expiry (WALE) of 5 years. The current lease is a classic ordinary one where the renter has the option to extend its contract.
According to MINT, the real estate remains in a strategic location, which provides a future redevelopment chance that produces added value.
Adhering to the suggested acquisition, MINT will have 65.9% of freehold properties in its portfolio, up from the percentage of 65.8% as at June 30. Its portfolio will expand to $9.1 billion by assets under management (AUM) up from $9.0 billion as at the very same duration.
Developed in October 1992, the structure remains on freehold land measuring about 91,200 sq ft. The property has a gross floor area of around 319,300 sq ft.
The facility includes an information centre, back workplace, training facilities and an adjacent accommodation wing that has the prospective for being redeveloped into a multi-storey data facility.
The proposed procurement is secured under the conditional trust beneficiary interest acquisition and stake agreement with Nagayama Tokutei Mokuteki Kaisha, an unconnected third-party vendor. Under the framework, MINT is going to have a reliable financial interest of 98.47% in the real property with a purchase investment of JPY14.9 billion. The balance of the acquisition consideration will certainly be funded by MINT’s sponsor, Mapletree Investments.
The Chuan Park Lorong Chuan Road
“End-users and data centre providers have increased right into brand-new information hub clusters across Greater Tokyo because the restraints of land and power and the need for better redundancy. These led to West Tokyo becoming a larger submarket, that represented around 40% of complete live IT supply in Greater Tokyo market,” the REIT supervisor describes in its Sept 30 announcement.
The proposed purchase is assumed to occur by the fourth quarter of 2024.
On a historic pro forma basis, the proposed purchase and its proposed method of funding are going to be accretive to MINT’s distribution per unit (DPU). The manager means to fund the total expense via Japanese yen (JPY)-denominated fundings to “give a natural resources hedge”. MINT’s accumulation leverage proportion is anticipated to increase to 39.8% from 39.1% as at June 30.
With solid demand and minimal supply growth, the data centre area is anticipated to expand at a compound annual growth rate (CAGR) of 9.3% from 2023 to 2033, states MINT’s manager referring to stats from DC Byte’s Japan data centre market report for this year. The similar report notes that the vacancy rate is anticipated to tighten up to 6% by 2033, from 9% in 2023 and 23% in 2018.
It will likewise boost MINT’s geographical diversity 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.
The factor exemplifies a discount rate of some 3.3% to the real estate’s appraisal of JPY15.0 billion. The property was independently valued by JLL Morii Valuation & Advisory K.K.
