ESR Cayman, the sponsor of ESR-REIT and ARA LOGOS Logistics Trust (ALOG), has announced its plans to develop a US$1.5 billion ($2.04 billion) multi-phase logistics development in Greater Osaka on March 3.
The development, ESR Kawanishi Distribution Centre, sits on a 505,647 sqm prime site in Japan’s Kawanishi City.
ESR Kawanishi Distribution Centre is a two-phase development located in the eastern Hyogo Prefecture of Kawanishi City, sitting at the core of the Greater Osaka Inland logistics market.
Phase 1 will consist of two six-storey multi-tenant facilities with a gross floor area (GFA) of 99,051 sqm and 98,746 sqm respectively.
The first phase is expected to break ground in July 2023 and is slated to be completed in December 2024.
The two buildings of Phase 2 will commence construction from 2025.
“Considering the scale, complexity and location of the development, ESR Kawanishi Distribution Centre represents one of the largest and most significant urban rezoning projects in recent years, strategically repurposing a prime residential site for logistics and industrial use,” says Stuart Gibson, co-founder and co-CEO of ESR.
“This is an extensive master plan that will help fulfil the growing demand for large-scale, cutting-edge logistics space in Greater Osaka, while enabling the area to reinforce its leading position as a global logistics hub. This development also helps unleash the full potential value of the site and benefit the long-term development of the area by promoting job opportunities, taxable income and thereby economic growth,” he adds.
The logistics sector in Greater Osaka has been showing continued strength with key factors including the ongoing rise of e-commerce, the automation of logistics operations and transformation of the supply chain ecosystem.
In the second half of 2021, the Greater Osaka area recorded the lowest vacancy since 2017 at mid-1.0% and average rent rose by 0.8% year-on-year, led by rent growth in Osaka Inland by 2.3% year-on-year.
This rezoning project in Kawanishi City is the latest in a long line of change of land use developments which ESR has undertaken over the past decade, says the group, adding that it places great emphasis on urban planning and has created a dedicated team that specialises in land rezoning.
To be sure, preservation of the community and environmental heritage is instrumental in all ESR developments, says the real asset manager.
“Sustainability, technology and innovation are shaping the future of new economy real estate,” says Gibson.
“We make the best use of our experiences and expertise to go beyond the provision of prime facilities for not only our customers and the logistics market but also the local communities in which we operate. Through the creation and operation of best-in-class properties like ESR Kawanishi DC and our other landmark developments in Yokohama Sachiura, Kuki, Fujiidera, Amagasaki, to name a few, we are proud to be able to make meaningful contribution and positive impact for the people and communities that we connect with,” he continues.
Photo: ESR
