Shinagawa-ku. This is a small office building with 3,800 square
meters of lettable space. The second property is called Kirin
Yokohama Building, located in Yokohama. The building has
approximately 4,000 square meters of lettable area. Both
properties were acquired for prices that were at a discount to
their fair market valuations.
ARA Harmony Fund III
The ARA Harmony Fund III owns a portfolio of five
commercial properties in Malaysia. The income generating
properties include Ipoh Parade Mall in Perak, Klang Parade
Mall and Citta Mall in Selangor, 1 Mont Kiara Retail Mall and
Office Tower in Kuala Lumpur, and AEON Bandaraya in
Malacca. As at December 2015, the assets’ occupancies
have improved to between 86.8% and 97.7%.
OUTLOOK FOR 2016
The outlook for the region’s key economies in 2016 is
undoubtedly one of significant uncertainty and slower
growth. The unfavourable trends from 2015 relating to China’s
slowdown, low oil prices, Europe’s uneven recovery and global
stock market turmoil are expected to continue into 2016. Given
such a challenging macro environment, Straits Real Estate’s
priority for 2016 is to ensure that its assets are well managed in
order to weather this difficult period and deliver its targeted results.
Looking ahead to 2016, Straits Real Estate will continue to seek
out new and attractive investment opportunities. It believes that
the environment will present opportunities that can be financially
rewarding over time. The approach to investing will be one of
prudence, with an emphasis on assets that offer strong immediate
cash flow, with longer term value-adding opportunities.
ARA Summit Development Fund I (“SDF I”)
The ARA Summit Development Fund I will co-invest with
developers in projects that have value enhancement potential
in South East Asia and Australia. Depending on the type of
project, SDF I may invest as an equity partner to share a
project’s development risk and returns, or participate in a
project as a mezzanine loan lender for lower risk.
As at December 2015, the fund has invested in a Sydney mixed
use development project named York & George. The project,
located at prime George Street, includes 199 residential
apartments, 4,500 square meters of office area, and 3,200
square meters of retail area. All of the apartments have been
pre-sold. The fund has made a mezzanine loan of AUD35
million to the developer, Fife Capital Management Pty Limited.
Greater Tokyo Office Fund (“GTOF”)
The Greater Tokyo Office Fund has a mandate to acquire
office properties in Tokyo and key cities in the neighboring
prefectures of Kanagawa, Chiba and Saitama. Cordea Savills,
the manager of GTOF works closely with banks and asset
management companies
to
identify properties that are
mortgaged as collateral for loans that are non-performing,
and seeks to acquire such properties at higher-than-market yields.
As at December 2015, the fund has invested in two properties.
The first is called Takanawa Muse, which is located in
Kirin Yokohama building, Yokohama, Japan
1 Mont Kiara mall, Kuala Lumpur, Malaysia
YEAR IN REVIEW
REAL ESTATE
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THE STRAITS TRADING COMPANY LIMITED
