Lendlease finished the conversion of Leaf Minatomirai in February
US private equity giant Warburg Pincus and Australian real estate group Lendlease have achieved the final closing of their Asia Pacific life sciences joint venture, with the companies aiming to grow the partnership into a multi-billion-dollar platform.
The Singapore-based JV will invest in acquiring, developing and operating life sciences projects in fast-growing regional markets, the partners said Thursday in a release. The venture is seeded with Lendlease’s APAC life sciences project construction management business and an asset management company that owns Leaf Minatomirai, a Japanese mall which the Sydney-based builder recently converted into an R&D workplace.
Financial specifics of the JV weren’t disclosed, but a source familiar with the deal told Mingtiandi that Warburg and Lendlease are committing several hundred million dollars each to the 50:50 partnership, which will invest across the region with an initial focus on capital deployments in Japan, Singapore and Australia. The platform will also raise additional capital from third-party investors.
“We firmly believe the life sciences and R&D real estate industry presents a tremendous opportunity for outsized growth in Asia Pacific,” said Takashi Murata, co-head of Asia real estate and head of Japan at Warburg Pincus. “This investment is consistent with Warburg Pincus’s approach of investing capital and resources alongside best-in-class entrepreneurs to create de novo platforms to capture the high-growth opportunities in the region.”
A New Leaf in Yokohama
Lendlease’s Asian life sciences projects centre on Singapore and mainland China. The group has completed over 100 laboratories, research centres and manufacturing facilities on behalf of pharmaceutical and biotech clients, including two-thirds of the greenfield life sciences facilities at Singapore’s 280 hectare (692 acre) Tuas Biomedical Park.
Takashi Murata, co-head of Asia real estate and head of Japan at Warburg Pincus
“We are looking forward to embarking on this journey with Warburg Pincus as we seek to establish the Asia Pacific’s leading life sciences and R&D real estate investment platform,” said Justin Gabbani, chief executive for investment management at Lendlease. “Lendlease will leverage its expertise in supporting the world’s largest pharmaceutical and life sciences companies, together with Warburg Pincus’s global experience, resources and strong track record in investing and scaling platforms in Asia.”
Leaf Minatomirai in central Yokohama’s Nishi ward spans 24,206 square metres (260,551 square feet) of net lettable area. Lendlease and its co-investor in the project, Dutch pension fund manager PGGM, completed their conversion of the 2004-vintage property in February, adding elevators and making upgrades to reposition the retail asset for R&D use.
Lendlease and PGGM had joined forces in 2022 on a S$1 billion (now $750 million) partnership to invest in innovation and life science properties across Australia, Japan and Singapore.
ASX-listed Lendlease is undergoing a business overhaul that the company estimates could free up as much as A$4.5 billion ($2.9 billion) in capital. The transfer of the life sciences interests to the Warburg JV is expected to contribute A$80 million in after-tax operating profit to the group, which has announced A$1.9 billion in transactions out of its fiscal year target of A$2.8 billion, CEO Tony Lombardo said in a Thursday stock filing.
“The establishment of our new life sciences joint venture with Warburg Pincus, one of the world’s leading global investors, creates a highly attractive growth platform to complement our existing international investment capabilities and ambition,” Lombardo said.
Building on a Theme
Manhattan-based Warburg Pincus gained exposure to Asia’s life sciences real estate and R&D space through a portfolio company, China’s DNE Group, which last year set up a RMB 3.5 billion ($485 million) life sciences park fund in partnership with a mainland unit of AIA Insurance.
The vehicle has invested in DNE’s Shanghai Jinchuang Building, an 88,688 square metre complex in Zhangjiang High Tech Park, which was completed in 2013.
Along with DNE, Warburg has worked with entrepreneurs to co-found some of the region’s most successful startups, including Hong Kong-listed ESR and Singapore-based data centre operator Princeton Digital Group. The firm has invested more than $8.5 billion in over 50 real estate ventures in Asia.
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