CDL invests in 25 freehold residential assets in Japan for $321.9 mil

CDL’s recent purchase of interests in 25 high-quality freehold residential assets in Japan for JPY35 billion ($321.9 million) is reportedly the group’s largest private rented sector transaction in Japan. Consisting of 836 units, including four retail units, the assets have an average age of less than two years old and are located in Tokyo’s 23 wards. All of these assets are within a 10-minute walk to a train station. Three are situated in ultra-prime residential areas in the city’s central five wards.

The investment, according to CDL, has strong investment potential due to the recovery of economic activities and rising demand for rental accommodation in Tokyo. Sherman Kwek, CDL’s group CEO, said, “Japan’s favourable interest rate environment presents a timely and strategic opportunity for the group to expand our residential rental portfolio through a rare off-market transaction for well-performing assets.”

He added, “Despite economic volatility over the past few years, our Japan residential portfolio has remained resilient, with stable rental growth and strong occupancy of above 95%. This investment marks the group’s entry into Tokyo’s rental housing market, enabling us to further scale up in this asset class while leveraging on the sector’s strong growth potential.”

Residents of Jurong Lake District Condo enjoy convenient access to a range of amenities and attractions located right at their doorstep. The precinct has been designed with a leisurely lifestyle in mind, and features lush green spaces, recreational spots and even a waterfront promenade. Residents can enjoy a leisurely stroll by the lake, marvel at the vibrant wildlife, or take in the views of the dramatic sunsets over the lake. In addition, Jurong Lake District Condo also features plenty of retail shopping centres, convenience stores, cafes, and supermarkets.

Given the strategic importance of this move, Kwek noted that it is “aligned with our strategy of expanding in the global living sector to enhance our recurring income.”

With the completion of the transaction, CDL’s Japan private rented sector portfolio located across Tokyo, Osaka and Yokohama has tripled. It now comprises of 38 assets with a total of over 2,100 units, with an asset value of over JPY 70 billion.

This large move of purchasing interests in Japan’s freehold residential assets provides the group with many advantages. By tapping into Japan’s favourable interest rate environment, CDL now stands to benefit from both steady rental growth and sustainable capital appreciation. Furthermore, entry into Tokyo’s rental housing market enables the group to scale up its asset class, while leveraging on the sector’s strong growth potential.

Overall, the purchase of interests in Japan’s freehold residential assets is a strategic move that will benefit CDL in terms of gaining steady rental growth, sustainable capital appreciation, and leveraging on the sector’s strong growth potential.