City Developments Buys Tokyo Land for S$356 Million From SeikoPooja Thakur
City Developments Ltd., Singapore’s second-largest developer, bought a plot of land in Tokyo valued at S$356 million ($279 million) as it seeks to expand overseas amid declining demand at home.
City Developments and a U.S.-based investment company jointly acquired the 16,815 square meters (4.2 acres) plot in Tokyo’s Shirokane area from Seiko Holdings Corp., the developer said in a statement to the Singapore stock exchange today. City Developments didn’t name the partner in the statement.
City Developments, which hired Grant Kelley from Apollo Global Management LLC as chief executive officer earlier this year, is entering Japan where property demand is picking up amid Prime Minister Shinzo Abe’s efforts to revive the world’s third-largest economy. Residential values in Singapore slid for a third quarter in the three months to June, the longest losing streak in five years, after the government introduced loan measures in June 2013, widening a campaign that began in 2009 to curb speculation.
“This acquisition is in line with CDL’s strategy to accelerate overseas expansion to supplement our existing operations,” Kwek Leng Beng, executive chairman at City Developments, said in the statement. Japan is “rebounding due to the positive impact of monetary easing, fiscal stimulus and reforms under Abenomics.”
Real estate prices have risen about 20 percent since Abe took office about two years ago, according to an estimate by Deutsche Asset & Wealth Management.
Among others that are expanding overseas is Keppel Land Ltd., Singapore’s third-biggest developer by value, which in July said it made its maiden investment in the U.S. with a prime residential development in New York City.
Pontiac Land Group, owner of the Singapore Ritz-Carlton, said in October it is investing $200 million to revive a project for a 72-story residential tower adjacent to the Museum of Modern Art in midtown Manhattan. OUE Ltd. agreed to buy U.S. Bank Tower in Los Angeles, California’s tallest building, for $367.5 million in March 2013.
The property curbs are working though it’s too early to relax the measures, Monetary Authority of Singapore Managing Director Ravi Menon said in July.