Insiders are saying that now is the time to invest as property prices in Japan are poised to climb, with Blackstone planning a large asset purchase with a face value of 100 billion yen ($1.16 billion). Acquisitions by JREITs have doubled from last year as they look to expand their portfolios.
According to a source quoted by Bloomberg, Blackstone Group LP is planning to make its debut entry into Japan by purchasing Morgan Stanley Japan’s real estate assets (11 non-recourse loans with 30 office buildings in Tokyo) with a face value of 100 billion yen ($1.16 billion) sometime next week.
Takashi Ishizawa, a real estate analyst at Mizuho Securities Co. predicts that prices are set to climb. “The news confirms my view that property prices in Japan have reached bottom,” Ishizawa said in a telephone interview in Tokyo. “Now is the time to invest.”
Blackstone may sell some of the buildings and own some after the acquisition of the debt portfolio, the person said.
JREITS are also increasing their activities. Bloomberg and IB Research and Consulting, Inc., states that acquisitions by the country’s 38 publicly traded real estate investment trusts more than doubled in the first quarter to 229 billion yen from the same period last year. Japan’s listed real estate investment trusts have raised 195.5 billion yen in the first six months of this year, the highest since 2008, as they look to expand their portfolios, according to Mizuho Securities Co.