SINGAPORE (THE BUSINESS TIMES) – CapitaLand has sold two of its retail malls in the Greater Tokyo area, Olinas Mall and Seiyu & Sundrug Higashimatsuyama, for over 42 billion yen (S$520 million).
At the same time, the property giant said it will invest about 7.5 billion yen (S$90.8 million) to fully acquire a freehold site in Ibaraki City, Osaka, and develop a four-storey modern logistics facility.
In a bourse filing on Thursday (July 1), CapitaLand said it expects to net a gain of close to nine billion yen from the recent sale of its two malls, which were divested above their total valuation.
With the latest transaction, the group has now divested all its five malls in Japan. It marks the group’s exit from retail in the country, which was a non-core asset class within its portfolio.
Jason Leow, president of Singapore and International at CapitaLand Group, said the proceeds from the group’s divestment of its mature malls will be reinvested into new economy assets with significant growth opportunities, such as logistics.
“The group’s total logistics assets under management (AUM), including our two logistics assets in Japan, is about $3.9 billion. Japan is a key market for CapitaLand to invest and expand our logistics portfolio to become a significant contributor to the group’s total logistics AUM,” he said.
Meanwhile, CapitaLand’s acquisition of the Osaka site from Mitsui & Co comes as part of its ongoing collaboration with Mitsui & Co Real Estate to develop and operate best-in-class logistics projects in Japan.
The logistics facility will have a gross floor area of about 27,000 square metres when completed in Q3 of 2023. CapitaLand highlighted that it will be well-connected to Kyoto and Kobe via major expressways, being located within a major logistics hub in Osaka.
“CapitaLand has clinched a highly sought-after site for the development of our second logistics asset despite a limited supply of logistics development sites in the Tier-1 markets of Japan. We are confident that the asset will meet the strong demand and we see further potential to expand CapitaLand’s logistics portfolio in the country,” said Gerald Yong, chief executive of CapitaLand International.
Shares of CapitaLand ended Wednesday three cents or 0.9 per cent higher at $3.71.