KBC Asset Management, a unit of Belgian financial group KBC, has launched a fund targeting Japanese real estate, looking to raise $300-$400 million (€200-€268 million) in equity. With leverage, the fund would have $1 billion in spending power.
With an investment period of five to ten years, the fund will invest in the office, retail and industrial markets of Tokyo, Fukuoka, Osaka, and other maj or Japanese cities. It will have a minimum investment criteria of €250,000, and will target an internal rate of return of 15 percent. As part of the fund, KBC has established a joint venture with Japanese property firm MAC Investment Management.
In a statement, KBC said it has identified a seed portfolio of up to 25 property assets which it could buy over the next three years. The firm pointed out that as the US and Western European property markets have faltered, Japanese commercial property values have held firm. Last month a report by Real Capital Analystics revealed that Tokyo has overtaken London and New York as the most active office sales market in the world, after property sales in Japan more than doubled during the past 12 months.