Sumitomo Mitsui Trust Bank, Limited (SuMi TRUST) and Aberdeen Standard Investments (ASI) have established a joint venture that will invest in residential real estate in Japan and other mature markets across the Asia-Pacific.
In Japan, SuMi TRUST has a strong presence, significant real estate investment capability, a nationwide brokerage network and unique access to domestic deal opportunities. Combining this with ASI’s global distribution platform and extensive Asia-Pacific real estate fund management and investment expertise, the joint venture aims to deliver a compelling Asia-Pacific real estate strategy for investors.
Through co-investment and co-management by ASI and SuMi TRUST’s subsidiary Sumitomo Mitsui Trust Real Estate Investment Management Co., Ltd. (SuMi TREIM), the joint venture will target investments in residential assets such as multi-family, senior housing, student housing and corporate housing in mature markets in the Asia-Pacific region, primarily focusing on Japan.
Adopting a value-added investment strategy, it aims to enhance capital and income through acquiring newly constructed properties on a forward commitment basis, as well as older residential properties which have the potential to be renovated, repositioned or converted.
A continued trend towards urbanization 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. Similar trends amongst the Asia-Pacific region’s largest cities will support its residential real estate investments beyond Japan.
Environmental, Social and Governance (ESG) factors will be fully embedded into the investment process, with the aim of supporting sustainable social development through ESG-screened investments in Japan.
David Paine, global co-head of Real Estate, Aberdeen Standard Investments, says, “The joint venture is an important step in expanding our global investment offering, as we continue to address investors’ need for alpha and diversified return.”
Kang Puay Ju, head of Real Estate Asia Pacific and global head of Real Estate Multi -Manager, Aberdeen Standard Investments, says, “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 bodes well for housing demand over the medium term.”
