Tokyo’s Alyssa Partners Leads $300M Shibuya Buy in Tight Office Market

Tokyo’s Ebisu district has attracted its second major office investment in six months, with residential specialist Alyssa Partners agreeing to pay around $300 million for a commercial building sharing the same transit links as the Yebisu Garden Place complex at the centre of PAG and KKR’s $3 billion acquisition of Sapporo Real Estate.

The Tokyo-based firm is investing in Ebisu First Square alongside an unnamed global real estate investor and will serve as asset manager, according to a Friday announcement, betting on rising demand for high quality office space in Tokyo’s five central wards. No financial terms of the investment in the 12-storey building were disclosed, with market sources who spoke with Mingtiandi indicating the $300 million deal value.

The fully occupied building sits 800 metres (one-half mile) from Yebisu Garden Place, the landmark mixed-use complex at the centre of the $3 billion acquisition of Sapporo Real Estate which KKR and PAG announced in December. With typical floor plates of more than 10,000 square feet, the building has been fully let since its completion in September 2014, with Shibuya ward offices at full occupancy as of 31 March, according to Cushman & Wakefield.

“We are excited to close this sizable office investment in central Tokyo at a time of low vacancy, strong tenant demand and limited new supply,” said Chedli Boujellabia, managing partner, CEO and co-CIO of Alyssa, which manages JPY 430 billion ($2.7 billion) in assets. “The quality of the building, its proximity to Ebisu station and the 10,000-plus square feet floorplate are favourably positioning the asset to capture significant rental growth in the coming years as part of our value enhancement business plan.”

Digital Hub

Located in southern Shibuya’s Ebisu area, Ebisu First Square is one stop from Shibuya station on the JR Yamanote Line, and connects to Roppongi and Ginza via Tokyo Metro’s Hibiya Line. 

Completed in September 2014, and fully let since then, Ebisu First Square offers around 110,000 square feet (10,219 square metres) of net lettable area across 12 floors. At the reported compensation, Alyssa and its partner are paying the equivalent of JPY 434,714 per square foot for the asset.

Tenants in the property include digital media firm NewsPicks, Inc, and its parent company, Uzabase. Also leasing space is Loyalty Marketing, operator of Ponta loyalty point systems, and digital advertising firm Value Creation Marketing DX, according to public records. 

The property is located 5 minutes walk from Ebisu JR station and Ebisu subway station, offering access to Japan Railway’s above-ground network and Tokyo Metro’s Hibiya Line.

Emerging Market

One of Tokyo’s five central wards, Shibuya has been attracting an increasing concentration of technology tenants, according to industry analysts, tightening an already constrained supply picture and boosting Ebisu, traditionally a high-end residential area, as an emerging office location.

Grade A office rents across Tokyo’s five central wards rose 11 to 13 percent year-on-year in the first quarter, according to Cushman & Wakefield and JLL, while the city ranked second globally for the value of office assets traded during the period, behind only Singapore, according to MSCI.

PAG and KKR’s December deal to acquire Sapporo Real Estate, which has a portfolio centred on the Ebisu area anchored by Yebisu Garden Place, is scheduled to see completion of its first tranche on 1 June.

Sapporo Real Estate developed Ebisu First Square as one of its last office projects in the district, before selling the property to US investment manager Westbrook Partners in 2021. Westbrook then exited to a fund formed by Mitsui & Co Digital Asset Management and Tozai Asset Management in 2023 for an undisclosed amount.

Residential Roots

The Ebisu deal marks Alyssa’s second office investment, following a joint venture with Paris-based AXA IM Alts, now BNPP AM Alts, to develop a 4,000 square metre office asset in Roppongi after purchasing the site in 2018. 

Having fully leased the project to a serviced office operator, the partners began construction on that office project in 2019 before selling the property to Korea’s Daishin Securities in 2021. 

In its core residential business, Alyssa teamed with Mitsui & Co Digital Asset Management and a domestic institutional investor in January to acquire Higashi Kanda Terrace Residence, a 132-unit rental tower in Chiyoda ward, for a price understood to be around $80 million.

That deal followed Alyssa’s September purchase of 22 residential properties on behalf of an investor believed to be Singapore sovereign fund GIC through a joint asset management mandate with Samty Holdings, a portfolio company of Hillhouse Investment’s Rava Partners.

Alyssa has also moved into hospitality and logistics, having partnered with Mitsubishi HC Capital Realty last year to acquire a Fukuoka hotel and teamed with China’s JD Property in late 2024 to buy two GLP warehouses in Chiba and Nagoya. 

“We continue to have strong convictions in both residential and office assets in Japan as scalable strategies and we expect to increase our exposure to both asset classes in the coming months,” Boujellabia said Friday.