Morgan Stanley Real Estate Investing (MSREI) has raised JPY131bn (€755.4m) for its maiden Japan-focused, yen-denominated fund, exceeding its initial fundraising target of JPY75bn.
MSREI said the North Haven Real Estate Japan Strategy Fund I’s (JSF) investor base comprised mainly of Japanese pension funds and financial institutions, paired with foreign sovereign wealth funds.
The closed-ended fund, which will invest in properties across major Japanese markets like Tokyo and Osaka, completed its first acquisition in March 2025. To date, JSF has committed approximately 8% of its capital to several residential investments.
Yu Kawamata, co-head of MSREI Asia investments and head of MSREI Japan, said: “Japan has a positive macroeconomic outlook driven by inflation and wage growth, regulatory changes shifting corporate behaviour towards efficiency, and attractive yield spreads with favourable financing terms. Against this backdrop, real estate fundamentals continue to improve, particularly for sectors supported by long-term structural tailwinds.
“With 25-plus years of investing experience in Japan, we believe MSREI is well positioned to leverage its in-depth local market knowledge and strong access to opportunities through long-standing relationships to successfully invest JSF on behalf of investors.”
“We are extremely pleased with the strong investor support for JSF both from existing and new investors who recognise and value MSREI’s long history and deep expertise in Japan, having deployed more than $10bn (€8.5bn) of equity capital in the country since 1998.”
Toru Bando, CIO of MSREI and head of MSREI Asia, said: “With domestic capital in Japan increasing allocations to alternative products, including real estate, and broader institutional investor interest in Japan, we believe JSF offers investors a differentiated country-specific investment solution that combines MSREI’s strong local investing capabilities with a unique global perspective delivered through managing over $50bn of real estate assets globally and having the ability to leverage the broader Morgan Stanley franchise in Japan.”
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