M&G Real Estate Asia lifts ESR Ichikawa Distribution Centre stake to 58%

M&G Real Estate Asia has invested JPY34bn (€216m) to lift its stake in the ESR Ichikawa Distribution Centre to 58.3%.

The asset manager, via the M&G Asia core strategy, has now invested close to US$510m (€473m) in the logistics asset located in the Greater Tokyo Bay Area.

M&G Asia Property Fund was an equal partner in a club of four set up in 2021 to own the distribution centre in Ichikawa City, which was priced at US$870m.

The 201,111sqm asset is now the fund’s single-largest logistic exposure to the sector both in Japan and in the Asia Pacific region.

“ESR Ichikawa DC has very strong credentials and upside regarding rental reversions,” Richard van den Berg, fund manager of M&G’s Asia core property strategy, told IPE Real Assets.

“Acquiring a majority stake at an attractive going-in yield is an important milestone for M&G as we double down on our conviction and commitment to Japan’s logistics sector, which we believe will continue to play a pivotal role in the country’s economy as demand for high-quality assets remains.”

Van den Berg said logistics now made up 27% of the M&G Asia core property’s US$7bn portfolio.

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