GLP forms joint venture with CIC

Mainboard-listed Global Logistic Properties Limited (GLP) has formed an equal joint venture with sovereign wealth fund China Investment Corporation (CIC) to acquire 15 modern logistics facilities in Japan.

The deal, worth 122.6 billion yen or US$1.6 billion, is believed to be one of the biggest-ever property deals in Japan.

The properties, with a total gross floor area (GFA) of 770,989 square metres, will be acquired from LaSalle Investment Management (LIM) – a unit of real estate firm Jones Lang LaSalle.

A total of 90 per cent of the GFA is located within the greater Tokyo and Osaka areas.

The current occupancy of these properties is 98.3 per cent with a weighted average lease expiry of 5.6 years.

The properties focus on distribution and warehousing uses.

They are also modern facilities with a weighted average building age of only 6.9 years.

GLP said in a statement that the move would further grow its footprint in Asia.

Its CEO Ming Z Mei said its Japan portfolio will grow approximately 30 per cent to 3.6 million square metres. And this will make its footprint in Japan almost 40 per cent larger than its next largest competitor.

GLP added that the transaction will be funded with about 81 billion yen (US$1 billion) in debt .

The 50-50 joint venture with CIC also means each party will inject an equity commitment of US$272.9 million.

GLP said it will fund the equity commitment from internal resources.

The deal is expected to be completed in the first quarter of 2012.

Source : Channel NewsAsia – 19 Dec 2011

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