GE Real Estate Japan has made a strategic move in the Japanese real estate investment trust market by signing a landmark agreement with LCP Investment Corporation.
As part of the agreement negotiated with LCP REIT Advisors, GE Real Estate will provide preferential rights to LCP to acquire assets in GE Real Estate’s portfolio and a GE entity will acquire units in LCP.
To kick start the agreement, LCP will buy two offices and five multi-family properties located in the
Following the purchase, LCP’s assets will grow 64.3% to JPY 89.63 billion ($US740 million).
At the same time, a GE Japanese entity, New Mission Funding Corporation, will purchase 32,500 newly issued units in LCP for JPY 14.1 billion ($US117 million).
GE Real Estate
“This is a great opportunity for GE Real Estate to establish a cooperative relationship with a Japanese REIT with excellent growth potential,” he added.
LCP’s executive officer Shunji Miyazaki said GE Real Estate will present the trust with a pipeline of quality assets, and are in line with the trust’s external growth strategy.
LCP will raise the rest of the required cash for the transaction through a loan from UBS, which will increase the overall leverage for the REIT to nearly 60%.
UBS Securities Japan Ltd is the sole financial advisor to GE Real Estate
GE Real Estate
LCP was incorporated in September 2005 and was listed on the JREIT securities market of the Tokyo Stock Exchange in May 2006.
LCP’s portfolio consists of 36 assets, primarily residential and senior housing properties.
Australian Property Journal