ALPHA Investment Partners Limited (Alpha), PT Asuransi Jiwa Manulife Indonesia, a subsidiary of Manulife Financial Corporation (Manulife) and PT Mega Manunggal Property Tbk (MMP) have entered into a new venture which will focus on Indonesia’s fast-growing logistics property sector (the venture).

Comprising Keppel-MMP Indonesia Logistics Fund Private Limited and an Indonesian parallel fund, and co-investment capital from Manulife, the venture has an initial target size of US$200 million and brings together the capabilities of these three companies to jointly acquire and manage high quality logistics properties in Indonesia.

The venture is subject to the fulfilment of certain condition precedents, including the completion of the acquisition of the initial portfolio and has received initial capital commitments of approximately US$93 million (1,376 billion rupiah) from venture partners, including PT Asuransi Jiwa Manulife Indonesia.

Alpha, a private fund manager under Keppel Capital Holdings Pte Ltd, will be the investment manager of the venture, while MMP, a listed logistics space provider in Indonesia, will be the strategic advisor to Alpha and property manager of the venture's logistics properties.

As part of the agreements, the venture intends to acquire stakes in four modern and high-quality stabilized logistics assets in Greater Jakarta from MMP as its initial portfolio. The initial portfolio comprises three single-tenanted properties and one multi-tenanted logistics property with a total net lettable area of over 163,000 sqm.

These assets with an occupancy of more than 96%, serve established tenants in the consumer goods, logistics and e-commerce industries, such as Unilever, Li & Fung and DHL. The sale of these four assets by MMP to the venture, subject to conditions, has been approved by MMP’s shareholders at an extraordinary general meeting held on December 20 2019.

With Indonesia’s growing middle-class population driving the rapid growth in consumption and e-commerce, coupled with the limited supply of modern logistics facilities in Jakarta, the Indonesian logistics property sector is seeing strong demand and the venture offers the partners exposure to the high growth potential of the sector in Southeast Asia’s largest economy.