Mapletree Industrial Trust (MIT) has announced the acquisition of a mixed-use property in Tokyo, Japan, which includes a data center, offices, training facilities, and an adjacent accommodation wing. The purchase is being made through the acquisition of the beneficial interest of the trust for a value of 14.5 billion yen (approximately 129.8 million Singapore dollars).
Acquisition Details
– MIT will acquire an effective interest of 98.47% in the property.
– The property is located in Tama-shi, Tokyo, on a land area of approximately 91,200 square feet.
– The gross floor area is approximately 319,300 square feet.
– The property is fully leased to an established Japanese conglomerate with a weighted average lease term of approximately five years.
Strategic Opportunity
Lily Ler, Chief Executive Officer of Mapletree Industrial Trust Management Ltd., highlighted the strategic importance of this acquisition: “The addition of an absolute ownership property will enhance the portfolio’s geographical and income diversification. Its strategic location in western Tokyo, a key cluster of data centers in Greater Tokyo, presents a future opportunity for redevelopment into a new data center.”
Redevelopment Potential
Western Tokyo has emerged as a larger submarket for data centers, accounting for around 40% of the total live IT supply in the Greater Tokyo market. Strong demand and limited growth in data center space supply have compressed the vacancy rate in western Tokyo from 23% in 2018 to 9% in 2023, with expectations for further reduction to 6% by 2033.
Impact on MIT Portfolio
– The proportion of absolute ownership properties in MIT’s portfolio will increase from 65.8% to 65.9% (by land area).
– MIT’s portfolio will grow from 9.0 billion to 9.1 billion Singapore dollars in assets under management.
– Japan will increase its share in MIT’s portfolio from 5.1% to 6.4%.
Financing and Expectations
The total outlay for the proposed acquisition is approximately 14.9 billion yen (133.6 million Singapore dollars). The acquisition will be funded through yen-denominated loans and is expected to be accretive for MIT unitholders.
The proposed acquisition is expected to be completed in the fourth quarter of 2024.