Allianz Real Estate has established a new Japanese multi-family residential investment platform in partnership with Ivanhoé Cambridge and an Asian sovereign investor.
The Allianz Real Estate Asia-Pacific Japan Multi-Family Fund I (AREAP JMF 1) had a first close of US$$500m (€443m). A second close is expected by the end of the year taking the platform’s total equity commitment to US$750m.
Rushabh Desai, Asia-Pacific CEO of Allianz Real Estate told IPE Real Assets that depending on the pace of deployment, the investors would have the option to increase their equity commitments up to an overall hard cap of US$1bn.
Upon being fully invested, he said, the platform would have an investment capacity of approximately US$2-US$2.5bn in gross asset value.
AREAP JMF 1 will acquire primarily newly completed, well-located assets in Japan’s four major cities, Tokyo, Osaka, Nagoya, and Fukuoka, and lease-up and stabilise the assets for long-term hold.
“We have assets under due diligence now and expect to finalise a couple of transactions in the first quarter of next year,” he said.
Allianz Real Estate itself already has a residential portfolio of approximately US$2bn in Japan, and has a strong team on the ground to source assets, he added.
This is the first Allianz Real Estate partnership with Ivanhoe Cambridge in Asia-Pacific, although the parent company had co-investments with the Canadian pension plan in Europe.
Desai said the new residential platform was part of the Allianz Real Estate strategy to bring in like-minded institutional investors to invest alongside Allianz and comes on the back of the 2020 launch of AREAP Core I, a US$2.3bn pan-Asia core investment platform where Allianz and NPS are 50-50 investors.
“We were encouraged by feedback from investors on the invest alongside Allianz strategy. The combined scale and expertise of like-minded institutional investors provide prioritised access to opportunities, said he told IPE Real Assets.
George Agethen, senior vice president of Ivanhoé Cambridge, described the venture as “an excellent opportunity” for the plan to launch its new Japan multi-family investment strategy.
“This investment will serve to further grow and diversify our portfolio in Japan and Asia-Pacific,” he said.
The new multi-family partnership is Ivanhoé Cambridge’s second Japan investment in 2021, following a last-mile logistics strategy announced earlier in the year.
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