Japanese giant Mitsubishi exits its $450m Australian land-lease partnership with Stockland
The portfolio includes six new operational land-lease communities comprising 2025 homes with resort-style facilities.
Japanese heavyweight Mitsubishi Estate Asia is selling its 49.9 per cent interest in a $450m land-lease partnership it set up with Stockland four years ago.
The sector has surged as buyers seek the budget sector which has become a much larger part of the property landscape. Operators such as Hometown Australia, Ingenia and GemLife are the major players. Contenders are also lining up for the Lincoln Place retirement business which will go on the market in March.
The Japanese group is exiting after backing Stockland in the development phase. CBRE’s Stuart McCann and Paul Ryan are handling the sale of the MEA stake, while Stockland will retain its majority holding and keep running the portfolio.
It includes six new operational land-lease communities comprising 2025 homes with resort-style facilities across southeast Queensland and Melbourne.
The deal is part of Mitsubishi Estate Asia’s global capital recycling strategy although it continues to be one of the top investors in local property where it has backed a series of office and residential towers, as well as industrial portfolios.
Mitsubishi Estate Asia has been selling out of holdings, including its interest in Salesforce Tower in Sydney after backing its development.
It is putting capital into new projects such as luxury apartments overlooking Hyde Park in Sydney.
Stockland chief executive Tarun Gupta. Picture: Jane Dempster
Mitsubishi Estate Asia head of Australia Yosuke Matsunaga said the Stockland Residential Rental Partnership and land-lease communities asset class had performed “exceptionally well” in the development period.
“As the portfolio is now largely stabilised, this divestment will allow us to recycle capital and pursue further high-quality investment opportunities in the Australian market,” he said.
Mr McCann said the sale was attracting strong local and offshore investor demand due to the opportunity to partner with Stockland and tap into Australia’s land-lease sector.
“Australia’s $12bn-plus land-lease sector is attracting major institutional and private equity capital, driven by strong demand for affordable, age-qualified housing,” he said.
“The Mitsubishi Estate Asia divestment provides an opportunity to invest in one of the country’s highest quality land-lease portfolios, alongside an operator and developer with a strong brand, over 20 years of experience in the land-lease sector and a track record of successful delivery.”
Mr Ryan said the portfolio benefited from resilient operating cashflow and annuity-style income. “An ageing population with an extended lifespan and growing retirement wealth is driving demand and supporting the premium end of the land-lease market,” Mr Ryan said.
“The Stockland Residential Rental Partnership portfolio is supported by this lifestyle-focused demographic and the growing demand for community lifestyle benefits, amenity and convenience.”
Stockland, under chief executive Tarun Gupta, has made capital partnerships a priority and it retains close ties with Mitsubishi Estate Asia.
In 2023, the Japanese group struck a deal to invest in Stockland-owned housing estates. The listed company separately has a $1bn capital partnership with US giant Invesco Real Estate in the land-lease sector.
The company last year closed deals worth about $800m to bring US private equity house KKR and British funds giant M&G Real Estate into its logistics business.
