Market Entry in Japan: Commerz Grundbesitz Counts among the German Pioneers in East Asia

Commerz Grundbesitz-Investmentgesellschaft (CGI), a member of Commerz Grundbesitz Group (CGG), signed the deed for an outlet-shopping centre in Tokyo. The transaction has a volume of around Euro 100 million. This makes CGG one of the German pioneers on the Japanese market for retail real estate.
“By placing our signature under the deed for a major transaction, we are realising our market entry in the nascent and growth-intensive real estate locations in East Asia,” says Dr. Frank Pörschke, Chairman of the Board of Managing Directors of Commerz Grundbesitz Group.
The building is a direct investment for the portfolio of hausInvest global, one of the funds managed by CGI.
With an extra-European real estate share of about 75%, hausInvest global is the industry leader among globally and multinationally investing open-end property funds.
The shopping centre was sold by Shinjuku Otwo and represents a fully let retail property with a gross lettable area of about 6,400 m². The existing lease has a remaining lifetime of about 15 years. The tenant, a prestigious listed Japanese retail company, successfully operates an outlet centre for luxury brands in the let area, the centre being the company’s flagship store and hallmark.
The eight-storey building is located in Shinjuku district, which has a population of more than a million. It is the retail location with the highest turnover in Tokyo. Moreover, the building is located in the immediate vicinity of the well-known Shinjuku train station. With up to 4 million passengers daily, it is one of the most frequented stations in the world. In 2008, the centre will actually get direct access to the Shinjuku Sanchome underground station, a crossing of 3 major underground lines and just in front of the building.
Yet it is not just Tokyo that is considered a great location. Japan as a whole is one of the most interesting real estate locations among the established markets in Asia.
“The Japanese economy is not just the second-largest in the world, but is also increasingly gaining momentum after a lengthy recovery phase. The Japanese real estate markets, too, benefit from this development now,” Pörschke emphasizes.
In Tokyo, he adds, it has become virtually impossible to find any space to let. Even now, the tenancy quota is said to be one of the highest among the metropolises in the world’s largest industrial nations, the so-called G8 states. The current boom on the Japanese real estate market concentrates on office space and in particular on retail real estate.
As Pörschke continues to elaborate: “Not only is our new acquisition located in the capital of Japan, a nation marked by high consumer spending, but it is moreover located in the district with the highest retail sales. Thus, hausInvest global will benefit immensely from the outstanding location of the centre and from the stable rental income.”
“Our first investment in East Asia constitutes another important step in the ongoing evolution of our real estate group. We are making great progress in our effort to position ourselves as a globally active real estate asset manager,” Pörschke points out.


A Word on Commerz Grundbesitz Group:

Founded in 2001, Commerz Grundbesitz Group counts among the global leaders in real estate asset management, managing public open-end property funds along with open-end institutional property funds and REITs. The Group currently manages real estate with a volume of approximately Euro 13 billion worldwide. With foreign real estate assets worth more than Euro 10 billion, and a gross lettable area of approximately 3.5 million m2, Commerz Grundbesitz Group is one of Europe’s largest real estate investment houses.
The Group includes Commerz Grundbesitz-Investment GmbH (CGI), a capital investment company founded in 1992, which manages the Group’s retail funds. Among these, hausInvest europa represents the German market leader in the sector of open-ended property funds, with a Fund volume of more than Euro 8.2 billion. In March of 2004, CGI started hausInvest global, an open-end fund with investments worldwide and a fund volume now worth approximately Euro 1.2 billion. The market share of CGI in the overall volume of mutual real estate funds currently exceeds 12%. So far, more than 450,000 investors have invested in CGI funds.