ESR Cayman Limited, the largest APAC focused logistics real estate platform, today announced the successful listing of ESR Kendall Square REIT Co., Ltd. on the KRX KOSPI Market of the Korea Exchange, marking the first publicly listed institutional quality logistics asset focused real estate investment trust (“REIT”) in Korea.
With the completion of the global offering, ESR Kendall Square REIT has a portfolio with total asset value of approximately US$1.3 billion and a market capitalisation of approximately US$650 million.
ESR Kendall Square REIT is sponsored by ESR Kendall Square, a subsidiary of ESR, with prime logistics facilities in Korea as its underlying assets. The initial portfolio consists of 11 modern, institutional-grade logistics facilities mainly located in the Greater Seoul Metropolitan Area, with a total GFA of 684,095 sqm. Ten of these were recently acquired, through a combination of direct asset purchases and through the purchase of approximately 99% equity interest in four real estate funds that own certain of the properties, from funds managed by ESR Kendall Square. The acquisition of the 11th property, the Anseong Logistics Park, is expected to be completed by June 2021.
Thomas Nam, CEO of ESR Kendall Square, said, “This is a very exciting time and meaningful milestone for ESR Kendall Square. The successful listing of ESR Kendall Square REIT is a testament to the strong portfolios of quality assets, investors and tenants that our team has built through the years.”
“With the robust growth of e-commerce driven by a confluence of factors including the pandemic, public investors have shown a growing appetite for quality core assets that can generate stable, long-term returns. Backed by our team’s unrivalled capability and track record in developing and managing institutional-grade properties, we are well positioned to capitalise on the continued growth of e-commerce in order to deliver solid returns and value to our investors and stakeholders.”
Leveraging its relationship with the Group, ESR Kendall Square REIT is expected to have opportunities to acquire additional properties managed by ESR Kendall Square and its affiliates. It plans to continuously increase the value of its investments by acquiring assets in key areas, taking into account the locations, tenants and expected returns.
Jeffrey Shen and Stuart Gibson, Co-founders and Co-CEOs of ESR, said, “We are very proud of what ESR has achieved in the Korean market. As one of the world’s biggest e-commerce markets, Korea has continuously delivered ESR a strong performance and set great standards for the industry under the leadership of Thomas Nam and Jihun Kang.”
They added, “Thanks to the long-term support of our capital partners and customers, as well as dedication of our team, ESR has built a proven track record of robust growth across our public and private vehicles. We look forward to carrying this momentum into 2021 as we continue to strengthen our market presence and leadership position in Korea and the APAC region.”
ESR has built a strong portfolio of best-in-class logistics properties across Korea, and now leads the market on multiple fronts with its exceptional capability and track record in development as well as funds and asset management. It is the leading owner of logistics stock (by GFA from 2019 to 2020) in the country with the largest development pipeline in the Seoul Metropolitan Area. As of 30 September 2020, the total AUM and GFA of ESR’s Korea business had reached approximately US$7.2 billion and approximately 3.3 million sqm, respectively.
Citigroup Global Markets Korea Securities Limited, Morgan Stanley & Co. International Plc, Seoul Branch and Korea Investment & Securities Co., Ltd. are the joint global coordinators and underwriters. Other co-managers and underwriters taking part in this global offering include NH Investment & Securities Co., Ltd., KB Securities Co., Ltd. and Samsung Securities Co., Ltd.
On 22 December, it was announced that ESR Cayman had entered into a joint venture with Singapore sovereign wealth fund GIC to develop and own institutional-grade, “state-of-the-art” industrial and logistics facilities as well as acquire core assets in cities across India.
A statement by GIC said that the joint venture will be seeded with a build-to-core asset of around 2.2 million square feet located in close proximity to Mumbai and Thane. Both companies have jointly committed US$750 million in the JV, with GIC owning 80 percent.