Sumitomo units, ARA jointly invest S$297m in Capital Square office tower

REAL estate and environmental energy company SMFL Mirai Partners, real estate asset manager Kenedix, and ARA Asset Management have entered into a joint venture that will invest S$297 million in Capital Square, a mixed-use office property located in Singapore.

In a joint statement on Monday (Feb 21), the 3 companies said they were engaging in investment and financing businesses in the Asian region, and noted that Singapore has a predominance in the region, as well as promising prospects for a dynamic real estate market through a strong economic recovery.

SMFL Miral Partners is a consolidated subsidiary of Japanese leasing company Sumitomo Mitsui Finance and Leasing Company (SMFL). Meanwhile, Kenedix became a consolidated subsidiary of SMFL Mirai Partners in January 2021.

Capital Square is located in the central business district in Singapore and has a "high quality, diversified tenant-mix", including major financial institutions and IT companies with global operations as key tenants.

It consists of 16 office floors and 3 floors for shophouses, and was built in 1999 and refurbished in 2013.

The joint investment is the first transaction under the partnership, where Kenedix will look after the fund management operations while ARA will engage in asset management work.

The companies said they will leverage their combined network, expertise and strengths to "realise synergies across the tripartite collaboration to develop the investment and financing businesses as well as create new investment opportunities".

In 2016, ARA bought a 50 per cent stake in the building that was originally built by developer Keppel Land. The stake was valued at around S$415 million, or S$2,500 per square foot, according to estimates.

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