Hines Teams With Mitsubishi, Mitsui to Buy Singapore Warehouse From Tobacco Giant

Hines has acquired a northern Singapore logistics asset in partnership with Japan’s Mitsubishi Estate and Mitsui & Co, marking the US developer and investment firm’s second industrial deal in the Lion City.

Houston-based Hines, property giant Mitsubishi Estate and Mitsui unit MBK Real Estate Asia closed the sale-leaseback deal for 15 Senoko Loop with the seller, British American Tobacco, in late June, the buyers said Tuesday in a release. The transaction is the first Hines joint venture with Japanese institutional partners in Singapore.

No deal value was disclosed, but the four-storey facility in the Sembawang area had been put on the market in late 2022 for S$100 million (now $73.8 million). Hines previously teamed with German fund manager DWS two years ago to buy a ramp-up workshop in the Bukit Batok area from a Blackstone-controlled trust for S$93.8 million.

“We’re incredibly honoured and pleased to have Mitsubishi Estate and MREA, both real estate companies with presence in Singapore, as our partners,” said Kian Fong Lim, country head for Singapore at Hines. “With the growing strength of our industrial portfolio in Singapore, together with the sector’s demand and supply dynamics, we’re optimistic and eager to capture more opportunities in the market.”

Climate-Controlled Space

The property at 15 Senoko Loop sits on a 24,464 square metre site and provides 41,482 square metres (446,509 square feet) of gross floor area, including climate-controlled warehouse space and an administration component. London-headquartered tobacco giant BAT is leasing back the building as the anchor tenant.

A first-quarter supply crunch drove rent and capital value growth in Singapore’s industrial sector, which remains robust, said Koji Segawa, managing director of Mitsubishi Estate Asia.

“With a strong track record and deep experience in Asia Pacific as asset managers, owners, and investors, we’re confident that our collaboration with Hines will bring about greater value to our tenant and the community,” Segawa said.

Since 2020, closely held Hines has acquired 16 industrial assets in Asia Pacific totalling 460,000 square metres across Australia, China, Japan, South Korea and Singapore.

E-LOG Project on Track

The Hines JV’s asset sits about a 10-minute walk from where ESR-Logos REIT is redeveloping an industrial complex at 21B Senoko Loop.

The SGX-listed trust launched the S$38.5 million project in 2022 to transform the 1993-vintage property into a high-specification asset aiming for gold certification under Singapore’s Green Mark rating system for sustainable buildings.

The build-to-suit development, offering 18,623 square metres of gross floor area, obtained its temporary occupation permit in January of this year and will be leased to manufacturer NTS Singapore on a triple-net basis for 15 years with built-in rental escalations.