PGIM Real Estate acquires two assets in Japan

PGIM Real Estate continues to expand its investments in Japan, recently acquiring J Tower in Tokyo and the Toyobo Building in Osaka, on behalf of institutional investors, bringing the total assets acquired in Japan over the past 14 months to approximately $808 million.

“Low vacancy rates, strong tenant demand and limited office supply in Tokyo and Osaka, against a favorable economic backdrop for Japan overall, provide a compelling rental growth and stable income opportunity for our investors,” said Benett Theseira, head of Asia Pacific for PGIM Real Estate.

J Tower is an 18-story office building with a three-story office annex in the “Fuchu Intelligent Park” neighborhood of Fuchu City, a suburban area near Tokyo’s central business district.

The property underwent renovation during 2015 and 2016, and has about 366,000 square feet of lettable space. It includes a ground-floor food court–style restaurant, coffee shop, convenience store, post office and pharmacy, along with 18 stories of office space developed to cater to the back-office requirements of financial and technology companies.

The 13-story Toyobo Building is in central Osaka, Japan’s second-largest city.

The property is a multi-tenant office building constructed in 1980 as the corporate headquarters of Toyobo, one of the largest textile companies in Japan. It has approximately 388,000 square feet of office space, a cafeteria and a convenience store.

Toyobo is in Dojima, which is one of the largest office submarkets in the Osaka central business district. It is served by Osaka train station, and has four metro stations within walking distance.

These latest transactions follow three other acquisitions in Japan over the past 14 months:

• B-Town, a three-story, multi-tenant retail asset on “Cat Street,” a vibrant retail area of Shibuya/Omotesando in Tokyo, acquired in June 2017. The property is currently 95.1 percent occupied and experiencing strong demand from a range of tenants desiring exposure to this pedestrian shopping area.
• Jingumae 6, a multi-tenant retail-anchored redevelopment opportunity also on Cat Street, acquired in April 2017. Demolition has been completed and construction of a multipurpose facility is scheduled to begin in December 2017.
• Italian Cultural Institute Building, a high-specification office building in central Tokyo, acquired in October 2016. The property is 100 percent leased and offers stable income to investors.

PGIM Real Estate, acting on behalf of institutional investors, is the real estate investment business of PGIM, the $1 trillion global investment management businesses of Prudential Financial.