Dutch pension fund manager PGGM has strengthened its real estate investment relationship with Lendlease through a new value-add partnership to invest in Japanese logistics and office assets.
The two firms have created the Lendlease Japan Modernisation Partnership (LLJMP) with an investment capacity of up to JPY120bn (€660m), with PGGM, which invests on behalf of PFZW, holding a 95% stake and the Australian developer retaining the remaining 5%.
LLJMP will target the acquisition and repositioning of well-located logistics and office assets across key Japanese cities, with an initial emphasis on the Greater Tokyo and Greater Osaka regions.
The new vehicle builds on a relationship between the two organisations that spans over 25 years. Most recently, in June 2022, PGGM and Lendlease teamed up to launch the S$1bn Lendlease Innovation Limited Partnership.
Owned 85% by PGGM and 15% by Lendlease, that vehicle was established to target innovation and life science-focused real estate across Australia, Singapore and Japan.
Jikke de Wit, senior director private real estate, PGGM, said: “Our continued partnership with Lendlease reflects our confidence in both Japan’s long-term real estate fundamentals and Lendlease’s ability to identify and unlock value through active asset management.
“We believe the logistics and office sectors in Japan present attractive opportunities for modernisation to meet changing occupier requirements, with the mandate forming a strong fit with PGGM’s 3D investing strategy which balances risk, return and sustainability requirements.
“By combining our long-term capital with Lendlease’s local expertise and execution capabilities, we are well positioned to deliver resilient returns for our pension fund client PFZW while supporting the evolution of high-quality real estate in Japan.”
Penny Ransom, CEO, investment management, Lendlease, said: “This milestone reflects an extension of the successful value-add strategy we have delivered in Japan, while building upon our strong momentum in data centre activities in this market.
“We are pleased to further extend on our longstanding collaboration with PGGM through this new partnership, which reflects our shared conviction in the long-term opportunities presented by the Japanese market.”
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