Mapletree Closes on 2nd Japan Logistics Development Fund, Plans $710M in Projects

Singapore’s Mapletree Investments has closed on its second Japan logistics development fund with a goal of achieving assets under management of over JPY 110 billion ($710 million) after full deployment and completion of projects.

The unit of Temasek Holdings raised an undisclosed amount of capital for Mapletree Japan Investment Country Private Trust (MAJIC), according to a release, with Mapletree pointing to Asia’s second-largest economy as a haven during times of uncertainty.

“Amid the uncertain economic climate, Japan remains a preferred investment destination in the Asia Pacific region,” said Mapletree CEO Hiew Yoon Khong. “Interest from domestic and international investors in Japan continues to be driven by the overall resilience of its real estate sector and confidence in Japan’s continued economic performance after its emergence from decades of stagnation.”

Mapletree’s third-ever Japan-focused fund, MAJIC is seeded with three development projects sourced from the sponsor and located in major metro areas near logistics infrastructure such as cargo airports, seaports, expressways and industrial zones.

Tokyo Bay Last Mile

MAJIC’s seed assets consist of a forward-purchase last-mile logistics project next to Tokyo Bay and two land plots in central Kyoto and Sanbongi in northeastern Honshu for development into logistics facilities.

The fund will continue to source development projects for acquisition in order to fully deploy the committed capital raised, said Mapletree, which will maintain a minimum 20 percent stake in MAJIC. Other backers of the vehicle include sovereign wealth funds, investment companies and family offices.

Mapletree expects demand for modern logistics facilities in Japan to continue to outperform, underpinned by the acceleration of e-commerce and third-party logistics, growth in advanced manufacturing activities and supportive regulatory changes.

“As we navigate the challenging economic environment globally, Japan remains a resilient market that is tried and tested for investors aiming to invest in quality assets that provide attractive, risk-adjusted returns in the long run,” said Wong Mun Hoong, Mapletree’s CEO of Australia and North Asia. “Mapletree is focused on strengthening our foothold in this region to bring value to our investors through exposure to the country’s real estate sector.”

Building on Success

Mapletree launched MAJIC to build on the success of the two previous Japan vehicles, Mapletree Japan Logistics Development Fund (exited in 2020) and the value-add Mapletree Japan Office Fund (exited in 2019).

The two funds delivered an internal rate of return in excess of 20 percent, Wong said.

Mapletree manages three Singapore-listed REITs and eight private real estate funds holding assets in Asia Pacific, Europe and the US.