Hines, a US-based real estate investment manager and developer, has revealed its acquisition of a logistics property in Singapore in partnership with Mitsubishi Estate and MBK Real Estate Asia (MREA). Situated at 15 Senoko Loop in northern Singapore near the Johor-Singapore Causeway bordering Malaysia, the property spans a 24,464-square-meter site. According to a press release, the facility comprises a four-storey building with a total gross floor area of approximately 41,482 square meters.
Kim Fong Lim, country head of Singapore at Hines, told FinanceAsia: “Singapore’s industrial sector does present favourable dynamics. The sector has seen rent and capital value growth due to supply constraints, making it an attractive investment opportunity”. “Importantly, this deal represents Hines’ first joint venture with Japanese institutional partners in Singapore whom we look to scale our business within the market”, he added.
Hines is actively exploring various promising sectors in Singapore, including office, retail, and residential, with a continued emphasis on industrial properties. Lim noted that the team is also assessing potential ground-up development opportunities. According to CBRE, the property was listed for sale last October at an indicative price of S$100 million ($73.6 million). The exact terms of the transaction remain undisclosed.
According to LSEG data, there were 31 mergers and acquisitions (M&A) transactions targeting the Singapore market in the first half of 2024 within the industrials sector, totaling $175.3 million. Real estate transactions, documented separately, amounted to $126.85 million across 11 deals during the same period. Both sectors experienced a nearly 90% decline year-on-year compared to the first half of 2023.
This marks Hines’ second industrial deal in the Singapore market,after its acquisition of Bukit Batok Connection in 2022. The press release underlined that limited quality spaces and a supply crunch have driven up rent prices and capital value growth for Singapore’s industrial and logistics sector in Q1 2024, making it one of the “most popular” among Asia Pacific (Apac) investors.
Koji Segawa, managing director of Mitsubishi Estate Asia, expressed confidence that Singapore's logistics and industrial sector will remain strong. Meanwhile, Koji Nishikiori, director and CEO of MREA, highlighted the prime location of the acquired property and the sector's robust performance. The transaction, finalized in late June, followed a sale and leaseback arrangement with British American Tobacco, the anchor tenant, leasing the building back from Hines, Mitsubishi Estate, and MREA, who are now joint lessors.
Sumitomo Mitsui Banking Corporation (SMBC) Singapore Branch provided financing for Hines. Hines, which established its Singapore office in 2020, manages $73 million in assets for regional clients through funds and programmatic ventures. MREA, a wholly owned subsidiary of Mitsui & Co., was established in 2017 to focus on real estate business in Southeast Asia. Mitsubishi Estate, one of Japan's largest real estate developers, has a notable track record in Singapore, including the co-development of the CapitaSpring office building with CapitaLand.