ESR Shores Up Funds for Concluding Stage of Japan’s Sprawling 650000sqm Logistics Project

ESR Secures Third-Party Capital for Final Phase of Logistics Project in Tokyo

A Boost for ESR‘s Higashi Ogishima Distribution Centre

ESR, a leading real assets manager in the Asia-Pacific (APAC) region, has announced that it has secured additional third-party capital to develop the final phase of its ESR Higashi Ogishima Distribution Centre (HO DC) in the Greater Tokyo metropolitan area. The specific amount of capital raised has not been disclosed, but this investment will pave the way for the construction of HO DC 2, expected to begin in 2025.

Expanding on the Success of HO DC 1

HO DC 2 is the next step in the development of the logistics project initiated by ESR. It will be slightly smaller than the first phase, HO DC 1, but still an impressive eight-storey building with a total gross floor area of 306,000 square meters. The entire logistics project spans 650,000 square meters and aims to meet the growing demand for modern and efficient logistics facilities in the region.

Investor Confidence and Establishing Strong Relationships

ESR‘s ability to secure third-party capital for this project is a testament to the company’s track record and expertise in developing high-quality logistics assets. Stuart Gibson, ESR‘s group co-founder and co-CEO, expressed his appreciation for the trust and support of their capital partner. He emphasized how this initiative reflects the deep relationship and excellent track record the company has established with its investors.

ESR Japan Logistics Fund III

Capital for the partial sell-down of the land and related development funding obligations is being provided under the ESR Japan Logistics Fund III. This development fund was established by ESR in 2019 in partnership with Dutch pension fund manager APG and an Asia-based sovereign wealth fund. The fund aims to capitalize on the increasing demand for logistics facilities in Japan and promote long-term income potential.

A Perspective on the Growth of Logistics in Asia

Challenges and Opportunities

The investment in the final phase of the ESR Higashi Ogishima Distribution Centre reflects the growing importance of logistics in the APAC region, particularly in Japan. As the e-commerce sector continues to expand and global supply chains become more complex, the demand for efficient and modern logistics facilities is on the rise.

While this presents significant opportunities for real assets managers like ESR, it also brings about challenges. The logistics industry must constantly adapt to changing consumer behaviors, new technologies and regulatory environments. Additionally, sustainability and environmental concerns are becoming increasingly important in the development of logistics infrastructure. As the industry expands, it is crucial for companies to prioritize sustainable practices and minimize their impact on the environment.

Looking Ahead

ESR‘s ability to secure third-party capital for the final phase of its logistics project in Tokyo demonstrates the company’s strong position in the market and its commitment to providing high-quality assets to meet the growing demand. As the construction of HO DC 2 gets underway, it is expected to contribute significantly to the logistics infrastructure in the Greater Tokyo area. With its deep relationships with investors and expertise in the field, ESR is well-positioned to capitalize on the opportunities in the logistics sector in APAC and beyond.