Thakral Corp. said on Monday that it invested in Kitahama Building, an Osaka office building, in a move to expand its property investment portfolio in Japan.
The Kitahama Building, which is a 10-storey office building located near the Osaka Securities Exchange, has an occupancy rate of around 89 percent, it said in a filing to SGX after the market close on Monday.
The investment will be made via Thakral’s pooled investment vehicle, Thakral Japan Properties, in which the company holds around 50 percent, it said.
The company pointed to a strong leasing market, citing JLL data showing rents are expected to rise 6.4 percent this year and 7.5 percent next year.
“The investment is part of our broader strategy to ride on the growing tenant demand in Osaka,” Inderbethal Singh Thakral, the company’s CEO, said in the statement. “The region has the highest occupancy rate owing to strong demand from visitors as well as a limited volume of office supply.”
He added that Thakral would continue to seek property acquisitions, especially within Osaka’s office sector.
“We are optimistic that these investments will deliver positive income returns and yield capital growth over time,” he said.
The investment, which will be funded via bank borrowings, internal resources and via co-investors, the statement said.