Nippon Building Fund Incorporation (TSE:8951) has agreed to acquire Shinjuku Mitsui Building and Gran Tokyo South Tower from its founder and sponsor Mitsui Fudosan (TSE:8801) for a total of ¥220 billion.
Under the terms of the transaction, NBF will pay ¥170 billion for Shinjuku Mitsui Building and ¥47 billion for Gran Tokyo South Tower.
NBF intends to pay for the acquisition by issuing new investment units and loans to supplement its existing funds.
The transaction was announced on 9 October and has been approved by the Board of Directors of Nippon Building Fund Incorporation. Transfer of ownership is expected to be completed on 8 January 2021.
Mitsui Fudosan launched NBF in September 2001, following the creation of the J-REIT market. The company follows a model of joint value creation, using its development and property management capabilities to provide a steady supply of high-quality assets to the funds that it sponsors.
In a statement Mitsui Fudosan said it believed that “The properties to be sold to NBF will not only contribute to qualitative and quantitative external growth for NBF, but should stimulate the overall real estate investment market, which includes the J-REITs.”
The Shinjuku Mitsui Building, for many years a flagship property for Mitsui Fudosan, will keep the same name and Mitsui Fudosan will continue to manage the property.