JLL acts as exclusive advisor for sale of Extra Space Asia, an Asia-focused self-storage platform
Marquee transaction on the back of increased investor interest in Asian self-storage sector
SINGAPORE, October 27, 2022 – JLL today announced that it advised and managed the sale process of Extra Space Asia (ESA), a leading self-storage owner-operator in Asia. ESA owns operates approximately 70 properties across key Asian markets of Singapore, Malaysia, Taiwan, Japan, Hong Kong and South Korea, with a combined lettable area of in excess of 1 million square feet.
ESA has been acquired by a consortium comprising of APG Investments Asia Limited (APG), the investment manager for the largest pension provider in the Netherlands with AUM in excess of EUR553billion (US$556.7 billion), and CapitaLand Investment (CLI), a leading global real estate investment manager listed on the Singapore Exchange with AUM of about SGD125 billion (US$88.9 billion) and FUM of about SGD86 billion (US$61.2 billion).
ESA was founded in 2007 with two facilities and has since grown into one of the region’s largest self-storage businesses with facilities across six Asian gateway cities – Hong Kong, Kuala Lumpur, Seoul, Singapore, Taipei and Tokyo – with portfolio occupancy of over 90% and more than 70% of its net property income being generated in Singapore. The portfolio consists of modern and high-quality assets strategically located in high-density cities in strong catchment areas supported by high-density residential townships, or bustling commercial and industrial districts.
The acquisition of ESA comes with an experienced management team holding a proven track record in sourcing and managing quality self-storage facilities. Extra Space Asia has been a pioneer in the Asian self-storage market being the first provider in a shopping mall and operating large facilities in Korea & Malaysia, while also being the first non-Japanese operator in the Japanese market.
“We are truly honoured to be part of this APG and CLI joint venture. Being able to leverage their combined resources and extensive network will allow us to drive growth and accelerate expansion for our operations throughout Asia. This is an incredible opportunity for the brand, and we’re poised to further cement our position as the market leader in the self-storage industry,” says Kenneth Worsdale, CEO of Extra Space Asia.
Ms Patricia Goh, Managing Director, Southeast Asia, CLI, said: “As CLI grows as a real estate investment manager, we are pleased to embark on this strategic partnership with APG. CLI and APG are fully committed to the vision of creating a dominant Asia-focused self-storage platform that delivers long-term sustainable value to investors. Both parties will leverage each other’s strengths to grow this platform, with CLI contributing our expertise in fund management and operational know-how to manage the platform. With
the foothold gained through acquiring ESA, we will next look at scaling the platform through mergers and acquisitions as well as conversion of existing assets into self-storage facilities.”
“This transaction reflects investors’ continual confidence in Asia’s longer-term growth. In the current environment self-storage offers attractive and stable returns compared to traditional real estate assets. It is an asset class which is expected to grow in Asia on the back of increased adoption by users with need for more space at home given recent working trends. We are delighted to have advised ESA on this landmark transaction and further solidifying JLL’s track record in the self-storage sector in Asia,” says Ting Lim, Head of Capital Markets, Singapore, JLL.
The returns and risk profile of the self-storage sector has led to a trend of several new institutional investors entering the sector in Japan, Australia, Singapore and Hong Kong recently, looking to build up larger portfolios on the back of their initial acquisitions. JLL continues to see activity in the self-storage sector in these markets and most recently advised on the sale of self-storage platform Redbox in Hong Kong to Brookfield Properties.
“Self-storage is a mature asset class in the US and European markets, compared to countries in Asia Pacific where it is still in growth stage. There is strong interest from strategic overseas capital who are familiar with alternative assets like self-storage, co-living, etc, to tie up with operators in Asia, as they look to achieve scale in a fragmented market where these asset classes are expected to grow at a relatively rapid pace over the next 5 years” says Anirudha Ganguli, of JLL Asia Pacific Equity Advisory.
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $19.4 billion, operations in over 80 countries and a global workforce of more than 102,000 as of June 30, 2022. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.