CDL invests in 25 freehold residential assets in Japan for $321.9 mil

CDL, one of the world’s leading real estate companies, has recently purchased the interests in 25 superior freehold residential assets from the affiliates of the world renowned real estate investment manager BGO, for an investment of JPY35 billion ($321.9 million). These properties are all situated within a 10-minute walk from a train station, with three among them located in ultra-prime residential areas within Tokyo’s five central wards.

The acquisition comprises 836 total units, including four retail units, and are all less than two years old. With Japan’s favourable interest rate environment providing an apt opportunity, CDL is ready to tap into the potential of rental growth as well as sustainable capital appreciation of the housing market, with Tokyo experiencing a rebound in economic activities and an increase in demand of rental accommodation.

CDL Group CEO Sherman Kwek said, “This is an important investment opportunity for us, considering the global uncertainty and Japan’s natural attractability for institutional investors. By entering the Tokyo rental housing market, we may realize our goal of enlarging the rental sector and receiving stable income. Despite the economic volatility of recent years, our Japan residential portfolio stands resilient with solid rental growth and occupancy rate above 95%. This investment certainly aligns with our strategy of enlarging our global living options.”

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With the completion of the transaction, CDL’s private rented sector portfolio across Tokyo, Osaka and Yokohama has tripled to 38 assets and a total of over 2100 units, with a portfolio worth of JPY70 billion. It is CDL’s largest private rented sector transaction in Japan, marked with a huge potential for both the group and the investors.