M&G Real Estate has purchased a portfolio of 30 residential assets in Japan鈥檚 gateway cities of Tokyo, Osaka and Nagoya for 楼49.2bn (鈧�372m).
The assets will be held in the M&G Asia Property Fund and the deal lifts M&G Real Estate鈥檚 multifamily assets under management in Japan to 楼109.3bn.
Explaining the benefits of the deal for investors, Richard van den Berg, manager of M&G Asia Property Fund, said the combined acquisition would bolster the fund鈥檚 resilience, particularly from an income stability perspective.
He said the fund鈥檚 increased allocation to the residential sector also provided diversification benefits because residential assets were often regarded as counter-cyclical investments relative to the commercial office and retail sectors.
鈥淛apanese multi-family residential has proven itself through various economic shocks, highlighting the ability of the asset class to enhance risk-adjusted returns for core investors,鈥� he said, adding that Japan鈥檚 continued urbanisation underpinned the multi-family sector, in spite of the ageing of the country鈥檚 overall population.
M&G Real Estate was an early investor (2014) in Japan鈥檚 residential market. Since then, the multi-family sector has matured and is a strongly-favoured investment sector for foreign institutions seeking to allocate capital into Asia-Pacific.
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