M&G Buys Six Tokyo Residential Assets for $126M as Living Strategy Expands

M&G Real Estate has acquired six residential assets in Tokyo for JPY 19.4 billion ($126 million), upping its exposure to Japan’s rental housing sector as it seeks stable income streams in major urban markets.

The assets were purchased on behalf of the UK firm’s Asia Property strategy and Asia Living Property strategy, M&G said Tuesday in a release. The deal with an undisclosed seller adds more than 320 units to M&G’s portfolio in the Japanese capital, with the properties located in established neighbourhoods offering access to transport links and employment hubs.

Global investors continue to target Tokyo’s multi-family sector, drawn by tight supply, rising construction costs and steady population growth supporting demand. Average rent in the city’s 23 wards during the first quarter of 2026 rose 1.3 percent from the previous three months and 3.3 percent year-on-year to reach JPY 4,698 per square metre, according to Savills.

“Japan continues to stand out as an attractive residential market, particularly in Tokyo, where demand for well-located rental homes remains strong,” said M&G Real Estate Asia CEO JD Lai. “These acquisitions demonstrate our ability to source high-quality assets locally and invest with discipline in a market with long-term appeal.”

City Connectivity

Three of the acquired properties are newly built assets in the Ryogoku and Hikifune areas of Sumida ward, comprising 182 units across one- to four-bedroom layouts designed for singles, couples and families, M&G said. Completed between 2024 and 2025, the buildings are within a short walk of train stations, providing connectivity across the metropolitan area.

The remaining three assets are located in the Meguro, Mita and Machiya areas, comprising a further 138 units across a mix of studio to multi-bedroom apartments. Two of those properties include ground-floor retail components, while the Meguro building also features office space, providing ancillary income streams alongside residential rents.

The Tokyo purchases deepen M&G’s footprint in Japan, where in 2024 the firm acquired a prime residential portfolio in Osaka for $68 million. M&G’s global living portfolio spans $8.5 billion across Europe and developed Asia, with $1.4 billion invested in Asia Pacific.

The latest deal follows the investment manager’s push into other Asia Pacific living sectors as it broadens its regional strategy. In South Korea, M&G entered the residential market last year through the KRW 24.3 billion ($17.4 million) acquisition of a set of apartment assets in Seoul, marking its first move into that segment in the country.

Last month the firm announced its expansion into Australia’s senior living sector through a partnership with developer Stockland, targeting demographic-driven demand for retirement housing. M&G Real Estate acquired a 49.9 percent stake in the venture targeting two retirement-focused communities in Melbourne’s southeast growth corridor, with the projects expected to deliver a combined 573 homes for seniors by the end of 2029.

The burst of deals comes after M&G Real Estate won a $250 million commitment to its Asia Pacific living strategy from its London-listed parent group’s life insurance business less than two years ago.

Chasing Rental Income

Fresh capital continues to target Japan’s multi-family sector, with a joint venture of Alyssa Partners and Mitsui & Co Digital Asset Management acquiring a Tokyo residential tower for $80 million in the first quarter.

Global fund managers also remained active in Q1, with LaSalle Investment Management acquiring a 12-asset multi-family portfolio from Sekisui House REIT in January for $161 million.

Singapore-linked capital also featured during the quarter, with Rava Partners’ Dash Living picking up a $374 million Japan multi-family portfolio and CapitaLand Ascott Trust acquiring three Tokyo-area assets from Patience Capital Group for $29 million.