M&G Real Estate's Asia property strategy celebrates 10th anniversary with record number of transactions in 2016

 17 January 2017

 Hong Kong/Singapore

M&G Real Estate, the real estate fund management arm of M&G Investments, invested more than US$558 million in Asia Pacific real estate in 2016, marking its largest number of transactions by value since launch. Celebrating its 10th anniversary, M&G Real Estate’s core Asia property strategy continues to reinforce its leadership position as one of the largest and most diversified Asia core property portfolios.

Chiang Ling Ng, Chief Executive Officer and Chief Investment Officer of M&G Real Estate Asia, says: “The Asia Pacific real estate market has grown into the largest in the world, offering increasingly high levels of maturity, transparency and liquidity. This has created a wide and attractive universe of core real estate opportunities in a region once dominated by opportunistic investors.”

“In 2016 we strengthened portfolio performance and diversified risk by pursuing value opportunities in our target markets. Backed by a rapidly growing portfolio of assets, reflecting the diverse expertise of our team, we have built a market-leading reputation due to our focus on reliable and quality investment decisions.”

Notable 2016 deals include the acquisitions of Casey Central in Australia, Upsquare in South Korea, a logistics development site and a portfolio of retail and residential assets in Japan. In addition, Compass One, a suburban shopping mall in Singapore, was reopened by Teo Ser Luck, Ministry of Manpower in Singapore, in September 2016 following a major 10- month refurbishment programme.

“Aligning ourselves for growth and further diversification, we have increased our exposure to the logistics sector and secured assets with durable and sustainable cash flow in Japan. The portfolio continues to diversify by sector, asset type and tenant, whilst increasing current distribution yield and investor returns.”

Looking ahead, while Asia Pacific real estate pricing levels are currently elevated in comparison to historical standards, they remain healthy relative to bond yields. M&G Real Estate Asia’s strong asset management capabilities ensure it is well-placed to continue maximising value for investors.

Chiang Ling adds: “In 2017, we expect global political events and trade policies to perpetuate ongoing uncertainty. Nonetheless, rising real estate allocations is expected to continue to drive investor demand, particularly from global pension funds and insurance companies. Understanding individual market fundamentals and seeking assets with the best value within our geographical scope is key to generating returns.”

“Opportunities to acquire quality core real estate could arise out of counter-cyclical opportunities or development projects where a longer-term horizon and asset management expertise can generate returns. As such, our strategic focus on long-term income driven investment leaves us well placed for 2017.”

Key assets acquired by M&G Real Estate in 2016 in Asia Pacific:

  • US$164.7 million acquisition of Casey Central (retail) in Melbourne, Australia
  • US$113.2 million (JPY11.8 billion) acquisition of a logistics site in Kanagawa, Japan
  • US$141 million acquisition of Upsquare (retail) in Ulsan, South Korea
  • US$36 million (JPY4.2 billion) acquisition of a retail asset in Fukuoka, Japan
  • US$74 million (JPY8.725 billion) acquisition of a portfolio of residential assets across Chiba, Tokyo and Osaka, Japan
  • US$36 million (AU$50 million) acquisition of Templar Road (logistics) in Sydney, Australia
  • US$106 million (AU$146 million acquisition of The Olsen hotel and The Cullen Hotel in Melbourne, Australia

About M&G Real Estate’s core Asia property strategy: Launched in December 2006, it was the first open-ended real estate fund to invest in high quality real estate assets across the Asia Pacific region. It is now one of the market’s leading core property portfolios holding 22 assets across Australia (34.2%), Japan (18.1%), Singapore (23%), South Korea (17.9%) and Hong Kong (5.5%). The strategy has a value driven long-term investment philosophy.

  • The Asia Pacific real estate market has grown into the largest in the world, offering increasingly high levels of maturity, transparency and liquidity. This has created a wide and attractive universe of core real estate opportunities in a region once dominated by opportunistic investors.

    Chiang Ling,  Chief Executive Officer and Chief Investment Officer of M&G Real Estate Asia

If you require any further information, please contact

Thompson Wong
FTI Consulting
Singapore
  +65 6831 7840
  Thompson.Wong@fticonsulting.com

Emily Siu
FTI Consulting
Hong Kong
  +852 3768 4541
  Emily.Siu@fticonsulting.com



Notes to Editors

About M&G Real Estate
M&G Real Estate is the real estate fund management arm of M&G Investments and is one of the top 25 real estate fund managers in the world by assets under management, with over £24 billion (US $31 billion) invested in a broad spread of properties across Europe, North America and the Asia Pacific region (as of 30 September 2016). M&G Real Estate has a sector-leading approach to responsible property investment, and is committed to assessing and improving the sustainability performance of funds under management.

M&G is the investment arm of Prudential Plc in the UK, Europe and Asia. For more information please visit www.mandg.com/realestate

About M&G Real Estate - Asia
M&G Real Estate has offices in Singapore, Seoul and Tokyo dedicated to real estate in the Asia Pacific region. M&G Real Estate in Singapore is a subsidiary of London-based M&G Real Estate. As at 30 September 2016, the Singapore office is responsible for US$4 billion in assets.

M&G Investments and M&G Real Estate are business names of M&G Investment Management Limited, and they are used by other companies within the Prudential Group.

M&G Investment Management Limited is registered in England and Wales under numbers 936683 with its registered office at Laurence Pountney Hill, London EC4R 0HH. M&G Investment Management Limited is authorised and regulated by the Financial Conduct Authority. M&G Real Estate Limited is registered in England and Wales under number 3852763 with its registered office at Laurence Pountney Hill, London EC4R 0HH. M&G Real Estate Limited forms part of the M&G Group of companies. M&G Investment Management Limited and M&G Real Estate Limited are indirect subsidiaries of Prudential plc of the United Kingdom. Prudential plc and its affiliated companies constitute one of the world’s leading financial services groups and is not affiliated in any manner with Prudential Financial, Inc, a company whose principal place of business is in the United States of America.

The distribution of this press release does not constitute an offer or solicitation. It has been written for informational purposes only and should not be considered as investment advice or as a recommendation of any particular security, strategy or investment product.

The services and products provided by M&G Investment Management Limited are available only to investors who come within the category of the Professional Client as defined in the Financial Conduct Authority’s Handbook. They are not available to individual investors, who should not rely on this communication.