Nippon Life, Development Bank of Japan launch open-ended funds

Two of Japan’s largest institutions – Nippon Life and the Development Bank of Japan (DBJ) – have launched private real estate trusts.

The trusts are seeded with property valued at JPY30bn (€261m) and JPY33bn, respectively.

The open-ended funds have been created to offer Japan institutional investors additional investment avenues.

DBJ Asset Management Company - a unit of the Development Bank of Japan (DBJ) - launched DBJ Private REIT Investment Corporation (DBPR) on 1 August with a portfolio of “green” buildings valued at JPY33bn.

DBJ said it hopes to expand the trust’s portfolio to JPY150bn within five years. 

The vehicle will invest mainly in commercial office buildings, but will also invest in residential, retail and industrial properties. 

“We will target properties which have obtained DBJ Green Building Certificates so that we can contribute to society by providing more ecological and sustainable real estate assets,” the company said in a statement.

The Japanese bank introduced its DBJ Green Building Certification programme in 2011 to support environment and community-friendly real estate developments. It is now used nationally by leading building owners, including JREITs.

Nissay Asset Management, a subsidiary of Nippon Life, set up Nissay Realty Management (NRM) earlier this year to manage its own private REIT, which was also launched last month.

The Nissay vehicle owns office and logistics properties, among other assets.

Japanese institutions such as the JPY122trn Government Pension Investment Fund (GPIF), the world’s largest pension fund, have ramped up allocation to real assets – private equity, real estate and infrastructure – in both domestic and offshore markets.

GPIF appointed Norihiro Takahashi, former senior managing director at the Norinchukin Bank, as its new president in March, replacing Takahiro Mitani who had headed the organisation since 2010.

Hiromichi Mizuno, a partner of the London-based Coller Capital, was appointed to the role of executive managing director and chief investment officer in January 2015.