Mitsui Fudosan Says Logistics Investment to Reach $2.7 Billionby
Japan's biggest property company owns 10 distribution centers
Says it will add 5 warehouses to 7 already being developed
Mitsui Fudosan Co., Japan’s biggest developer by sales, said it will develop five distribution centers as part of a plan to boost its logistics portfolio amid rising demand from e-commerce.
The company, which owns and manages 10 warehouses throughout Japan, plans to add 12 more, with the total investment reaching 300 billion yen ($2.7 billion), Tokyo-based Mitsui Fudosan said in a statement Thursday. The 22 properties will have a combined floor area of 2 million square meters (21.5 million square feet), it said.
Mitsui Fudosan is joining other developers to provide new facilities in Japan as demand for logistics properties increases due to a boom in e-commerce. Supply in the greater Tokyo region reached a quarterly record of 150,000 tsubo in the last three months of 2015, according to CBRE Group Inc. A tsubo, a standard measure of area in Japan, is 3.3 square meters or 36 square feet.
The additional space pushed up the overall vacancy rate in greater Tokyo to 6.9 percent in the fourth quarter, according to CBRE. Even so, the vacancy rate of facilities more than a year old in the region fell to a record low 1.2 percent in the period, while for such properties in Osaka it dropped to 1 percent, the data showed.
The shares of Mitsui Fudosan, which started its logistics business in 2012, fell 0.3 percent to 2,790 yen at the morning break in Tokyo.