Sumitomo Mitsui Finance and Leasing (SMFL) has unveiled a strategic move to acquire the private funds division of ARA Asset Management, a prominent player in the real estate investment sector based in Singapore. This acquisition, through SMFL’s subsidiaries SMFL Mirai Partners (Singapore) and Kenedix, will result in the formation of a new entity, ARAvest, focusing on private fund operations primarily in Asia and Australia.
The deal, valued at $270 million, will see SMFL Mirai Partners and Kenedix acquiring 70% and 30% stakes in ARAvest, respectively. This acquisition is pivotal for SMFL, propelling its assets under management to an impressive 4.4 trillion yen ($30 billion). ARAvest is set to concentrate its portfolio mainly in Singapore and South Korea, leveraging ARA’s expertise in managing investments across hotels, office buildings, and other commercial properties.
The partnership is poised to synergize SMFL’s and Kenedix’s extensive networks, especially targeting Japanese investors, and broadening the investor base by facilitating overseas investments into Kenedix’s real estate assets in Japan. This strategic expansion is also an opportunity to innovate in the real estate investment space, with Kenedix planning to explore digital securities backed by property and potentially introducing new investment vehicles focusing on renewable energy and infrastructure, capitalizing on ARA’s managed overseas properties.
This acquisition marks a significant step for SMFL in enhancing its investment portfolio and solidifying its position in the real estate market across Asia and Australia, promising a new horizon of investment opportunities and innovative financial products in the real estate and infrastructure sectors.
