MHR acquired the compartmentalized ownership in the 23rd floor and the joint ownership in the compartmentalized ownership to 50% of the 24th floor, which corresponds to 6,666 m2 of exclusively possessed area in total.
The REIT previously acquired the joint ownership in 50% of the compartmentalized ownership to the 24th floor in 2010. Following the additional acquisition, the REIT now owns 2.8% of the exclusively possessed area of the entire building.
MHR will lease the floors that it acquired this time at a fixed rent to Mori Building, which will sublease the floors to end tenants. The monthly rent received from Mori Building is 75.49 million yen [$930,000] or 37,000 yen per tsubo [$140 per m2]. The REIT expects the net operating income (NOI) of the acquired space to be approximately 842 million yen [10 million] and based on this, the cap rate against the acquisition price is 4.5%.
Ownership in the Ark Mori Building was acquired for 17.2 billion yen [$210 million]. It is a four-minute walk from the Tameike-Sanno subway station. The building was completed in 1986 and has 37 floors above ground and four below with about 177,400 m2 of total floor space.
MHR acquired the compartmentalized ownership in the fourth, 15th and 24th floors, which corresponds to 8,013 m2 of the exclusively possessed area. The REIT already owns part of the building, which was acquired through several previous transactions. Following this acquisition, it now owns 15.6% of the exclusively possessed area of the entire building.
The three newly acquired floors will also be leased for a fixed rent to Mori Building, which will sublease the floors to end users. The NOI of the acquired space is expected to be 779 million yen [$9.6 million] and based on this, the cap rate against the acquisition price works out to be 4.5%.
Roppongi Hills Gate Tower, which the REIT sold, is a four-minute walk from the Azabu-Juban subway station and a six-minute walk from the Roppongi subway station.
It is a mixed-use building offering retail, office and residential spaces and is located by the Azabu-Juban entrance of Roppongi Hills. It has 29,111 m2 of total floor space in 15 floors above ground and two below and was completed in 2001.
MHR has owned the property since the REIT was listed on the market in 2006. The floors from the first to the third are occupied by tenants including a restaurant, a rental video shop and a supermarket. The occupancy rate was 97% as of the end of June 2011.
Following these transactions, MHR now has an acquisition price-based AUM of 211.52 billion yen [$2.6 billion].
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[Outline of Dealing]
Name: Roppongi Hills Mori Tower
Price: 18.68 billion yen [$230 million]
Rights: Trust beneficiary rights (Land: approx. 2.7% ownership, Building: compartmentalized ownership in the 23rd floor and the joint ownership in the compartmentalized ownership to 50% of the 24th floor)
Location: 6-10-1 Roppongi, Minato-ku, Tokyo (residence indication)
Access: 5-minute walk from Roppongi subway station
Land area: 57,177.66m2 (total), approx. 1,564.84m2 (dealed)
Floor space: 442,150.70m2 (total), 6,666.30m2 (dealed/exclusively-owned space)
Rentable floor space: 6,744.41m2 (dealed)
Structure: SRC, S
Stories (above/underground): 54/6
Completion: 2003
Dealing period: August 2011 (handover)
Name: Ark Mori Building
Price: 17.2 billion yen [$210 million]
Rights: Trust beneficiary rights (Land: approx. 4.1% ownership, Building: compartmentalized ownership in three floors)
Location: 1-12-32 Akasaka, Minato-ku, Tokyo (residence indication)
Access: 4-minute walk from Tameike-Sannno subway station
Land area: 39,602.42m2 (total), approx. 1,617.15m2 (dealed)
Floor space: 177,486.95m2 (total), 8,013.26m2 (dealed/exclusively-owned space)
Rentable floor space: 7,680.52m2 (dealed)
Structure: SRC, S, RC
Stories (above/underground): 37/4
Completion:1986
Dealing period: August 2011 (handover)
Name: Roppongi Hills Gate Tower
Price: 35.92 billion yen [$230 million]
Rights: Trust beneficiary rights
Location: 6-11-1 Roppongi, Minato-ku, Tokyo (residence indication)
Access: 4-minute walk from Azabu-Juban subway station
Land area: 4,560.15m2
Total floor space: 29,111.78m2
Structure: SRC, S
Stories (above/underground): 15/2
Completion: 2001
Dealing period: August 2011 (handover)
[Related article]
- Mori Hills REIT to reshuffle Y16bn in assets
[Related site]
- Announcement from Mori Hills REIT (Asset acquisition, PDF)
