J.P. Morgan Asset Management has closed its Japan Multifamily Fund II with 40.168 billion yen (US$375 million) in equity capital from a number of global institutional investors providing a total investment capacity of approximately US$1 billion, the company says in a statement.
The fund is the second in a series of dedicated closed-end, core-to-core-plus Japan Multi Family investment vehicles from J.P. Morgan Global Alternatives, a platform with US$144 billion in assets under management spanning real estate, infrastructure, transportation, hedge funds, private equity, private credit and liquid alternatives.
The platform’s Japan portfolios include more than 5,000 apartment units in over 90 properties.
The new fund is investing in a diversified portfolio of multi-family residential assets in Japan’s major cities, with more than 70% of assets in Tokyo and Osaka.
It was designed to capitalize on valuable investment opportunities created by Japan’s demographic changes, such as population migration from regional to large urban areas and an accompanying increase in the number of small households, which are driving outsized demand for studio and one-bedroom rental units.
With over 50% of the capital raised for the fund already allocated to investment opportunities, the fund has 37 properties closed and under contract.
“Japan is home to the largest institutional real estate market in Asia Pacific and the market for Japan multi-family properties has developed into an institutional asset class, making this a great backdrop for identifying long-term investment opportunities. The strong, resilient income and attractive risk-adjusted return profile of these assets are an ideal match for many institutional investors’ portfolio objectives,” says David Chen, head of real estate for Asia Pacific.