On behalf of its Asia Pacific core-plus investment strategy, PGIM Real Estate has acquired a 19,000-square-meter six-story office building in Tokyo, Japan. PGIM Real Estate is the real estate investment and financing business of PGIM, the US$1.5 trillion global investment management business of Prudential Financial, Inc. (NYSE: PRU).
The property is located in the Toyocho submarket, on the Eastern side of central Tokyo, within a six-minute walk from Toyocho Station on the Tokyo Metro Tozai Line. The Toyocho office market attracts many corporate tenants due to its convenient access to the Marunouchi / Otemachi central business district and its importance as a high-traffic distribution hub.
“Given its superb accessibility to central Tokyo, combined with the relative affordability of the area’s rents, Toyocho has historically experienced low vacancy rates and strong property values,” said Morgan Laughlin, PGIM Real Estate’s head of Japan. “These market dynamics will allow us to maintain high occupancy at the property, while unlocking additional value on our investors’ behalf through strategic building improvements.”
In addition to its location, the asset offers users relative affordability and large standard floor plates that allow for flexibility and can accommodate back office uses. The property has been upgraded with new elevator systems, common areas, hallways, and restrooms.
Benett Theseira, PGIM Real Estate’s head of Asia Pacific, added that “Looking beyond the current state of emergency, Tokyo’s economic recovery is expected to outperform the national average in Japan, with stronger employment growth expected over the next two years driven by the consumer, finance, and public sectors. In particular, we believe that well located and well managed office assets will demonstrate resilience through this cycle, driving attractive post-pandemic value growth.”