KKR & Co. Inc., Mitsubishi Corporation and UBS Group and UBS AG announced the signing of a strategic transaction by a subsidiary of KKR, which is acquiring all of the outstanding shares of Mitsubishi Corp.-UBS Realty Inc. from Mitsubishi and UBS Asset Management in an all-cash transaction valued at JPY230 billion (US$2 billion).
MC-UBSR is one of the largest real estate asset managers in Japan. Founded in 2000 as a joint venture between Mitsubishi and UBS-AM, MC-UBSR is a pioneer in the Japanese real estate investment trust (J-REIT) segment. Today, it is one of the largest real estate asset managers in Japan with JPY1.7 trillion (US$15 billion) in assets under management.2 The business has approximately 170 dedicated professionals managing two Tokyo Stock Exchange-listed REITs: Japan Metropolitan Fund Investment Corporation (JMF) and Industrial & Infrastructure Fund Investment Corporation (IIF).
JMF, with approximately JPY1.3 trillion (US$11 billion) in assets under management as of August 31, 2021, invests in retail, offices, hotels and other assets located in urban areas. IIF, with approximately JPY 0.5 trillion (US$4 billion) in assets under management as of January 31, 2022, focuses on industrial and infrastructure properties in Japan. Both REITs have established environmental, social, governance (ESG) programs and are included in the MSCI Japan ESG Select Leaders Index.
Mitsubishi and UBS-AM showed us unwavering support over the years, enabling MC-UBSR to become Japan’s outright top J-REIT manager. We are excited to welcome KKR, which brings significant resources and relationships to MC-UBSR, and is well-placed to work with our experienced team to extend our long and successful track record of delivering strong results for the unitholders of JMF and IIF and take the business to the next level.”
Katsuji Okamoto, President & CEO and Representative Director of MC-UBSR
“Japan is one of the most important and high-volume real estate markets in the world, and is a market we have been dedicated to investing in with a local team since 2006. MC-UBSR has an excellent track record of serving investors across its REIT offerings and a strong commitment to enhancing its investments through a strategic approach to ESG. We look forward to working with and supporting a team that has served investors so well over the last two decades, and we anticipate that our combined strengths will further enhance MC-UBSR’s ability to deliver for new and existing clients and unitholders,” said Hiro Hirano, CEO of KKR Japan and Co-Head of Asia Pacific Private Equity at KKR.
Takuya Kuga, Group CEO-designate, Urban Development Group of Mitsubishi, said, “We are pleased to have supported MC-UBSR’s development and operations over these past 20 years, and are proud to have grown MC-UBSR into Japan’s leading REIT manager. Mitsubishi continuously strives to optimize and strengthen its business portfolio, and will continue to expand its real estate development and asset management businesses in Japan, led by its wholly owned subsidiaries, Mitsubishi Corporation Urban Development, Inc. and Diamond Realty Management Inc, along with accelerating its initiatives in overseas real estate and large-scale urban development/management business. Welcoming a high-caliber real estate and diversified investment firm like KKR is a major endorsement of MC-UBSR, its team and its business, and we look forward to working with KKR and MC-UBSR.”
Suni Harford, President of UBS Asset Management, said, “In partnership with Mitsubishi, we are proud to have developed MC-UBSR into a leading real estate platform in Japan. We are confident that KKR is well placed to take this business forward and wish the MC-UBSR team every success for the future. The Japanese market remains a cornerstone of our Real Estate & Private Markets business in Asia Pacific, and we remain focused on serving the needs of our clients and capturing growth opportunities in this strategically important region. Through our rapidly growing real estate investment unit, UBS Japan Advisors, we will continue to advise our clients on Japanese property investments.”
UBS’s asset management, wealth management, and investment banking businesses operating in Japan are unaffected by the transaction.
KKR is a leading global investment firm that offers alternative asset management as well as capital markets and insurance solutions. KKR aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. KKR sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds. KKR’s insurance subsidiaries offer retirement, life and reinsurance products under the management of Global Atlantic Financial Group. References to KKR’s investments may include the activities of its sponsored funds and insurance subsidiaries.
Mitsubishi Corporation is a global integrated business enterprise that develops and operates businesses together with its offices and subsidiaries in approximately 90 countries and regions worldwide, as well as a global network of around 1,700 group companies.
Mitsubishi has 10 Business Groups that operate across virtually every industry: Natural Gas, Industrial Materials, Petroleum & Chemicals Solution, Mineral Resources, Industrial Infrastructure, Automotive & Mobility, Food Industry, Consumer Industry, Power Solution and Urban Development. Through these 10 Business Groups, Mitsubishi’s current activities have expanded far beyond its traditional trading operations to include project development, production and manufacturing operations, working in collaboration with our trusted partners around the globe.
With an unwavering commitment to conducting business with integrity and fairness, Mitsubishi remains fully dedicated to growing its businesses while contributing to a prosperous society.
UBS provides financial advice and solutions to wealthy, institutional and corporate clients worldwide, as well as private clients in Switzerland. UBS is the largest truly global wealth manager, and a leading personal and corporate bank in Switzerland, with a large-scale and diversified global asset manager and a focused investment bank. The bank focuses on businesses that have a strong competitive position in their targeted markets, are capital efficient, and have an attractive long-term structural growth or profitability outlook.
UBS is present in all major financial centers worldwide. It has offices in more than 50 regions and locations, with about 30% of its employees working in the Americas, 30% in Switzerland, 19% in the rest of Europe, the Middle East and Africa and 21% in Asia Pacific. UBS Group AG employs more than 72,000 people around the world. Its shares are listed on the SIX Swiss Exchange and the New York Stock Exchange (NYSE). In Japan, the firm offers corporate, institutional, and high net worth private clients a full array of financial products and services through five business entities: UBS Japan Securities Co., Ltd., UBS AG Tokyo Branch, UBS SuMi TRUST Wealth Management Co., Ltd., UBS Asset Management (Japan) Ltd., and UBS Japan Advisors Inc.