Sumitomo Mitsui Trust Bank (Sumi Trust) has formed a joint venture with the UK FTSE 100 asset manager, Aberdeen Standard Investments (ASI), to invest in real estate in Japan and “mature” markets in Asia Pacific.
The Japanese trust bank’s subsidiary, Sumitomo Mitsui Trust Real Estate Investment Management Co, will co-invest and co-manage the joint venture alongside ASI, and the joint venture will primarily target opportunities in residential assets. This includes multi-family, senior, student and corporate housing in Asia Pacific with a focus on Japan.
The joint venture is mainly looking to acquire new build properties, as well as older residential properties that have potential for either renovation, repositioning or conversion.
“A continued trend towards urbanisation in Japan, especially the largest cities like Tokyo and Osaka provides the structural underpinning to the joint venture’s strategy, bolstered by significant rental and yield gaps between new and older buildings,” ASI said in a statement. “Similar trends amongst the Asia Pacific region’s largest cities will support its residential real estate investments beyond Japan.”
Kang Puay Ju, head of real estate for Asia Pacific and global head of real estate multi-manager at ASI said: “Over the next decade cities in the Asian Pacific region are set to experience very strong growth, fuelled by both domestic and foreign immigration to major metropolises, which bode well for housing demand over the medium-term.”
ASI added that environmental, social and governance (ESG) factors will be “fully embedded into the investment process” and aims to support sustainable social development through ESG-screened investments in Japan.
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