Global multi-manager acquires Mitsubishi Estate Asia’s stake in premium Australian land lease portfolio

A global multi-manager on behalf of an Australian super fund has acquired Mitsubishi Estate Asia’s 49.9% interest in the Stockland Residential Rental Partnership for AU$400+ million.

CBRE’s Stuart McCann and Paul Ryan advised Mitsubishi Estate Asia on the divestment, which involved MEA’s stake in one of Australia’s premium land lease portfolios.

The portfolio includes six new operational land lease communities comprising 2,025 homes with resort-quality facilities in prime lifestyle locations across South-East Queensland and Melbourne.

The interest will provide exposure to a high-quality portfolio of land lease assets, alongside Stockland, which will retain its 50.1% interest and continue to manage the partnership. The transaction reflected a yield of circa 5%.

The transaction highlights the growing participation of superannuation funds in Australia’s Living sector and reinforces the strength of the country’s diversified land lease communities market, which continues to attract new institutional capital.

Stuart McCann, CBRE’s Managing Director & Head of Capital Advisors, Pacific and Southeast Asia, said the transaction reflected the increasing appetite for Australia’s land lease communities sector from long-term institutional capital.

“This transaction is a significant marker for Australia’s Living sector, with this acquisition demonstrating how superannuation capital is increasingly targeting high-quality, income-producing living assets,” Mr McCann said.

“The sale also reinforces the depth of demand for established land lease communities, where access to stabilised operating portfolios is well sought after.”

CBRE’s Paul Ryan said the result highlighted the continued maturation of Australia’s diversified Living sector and the role land lease communities are playing in broadening institutional investment exposure.

“Globally, investors are seeking to increase their exposure to living assets across Asia Pacific, supported by resilient income profiles, demographic tailwinds and a structural undersupply of quality operating product,” Mr Ryan said.

“Australia remains underweight to Living compared with more mature markets, with the sector accounting for just 9% of commercial real estate investment volumes last year, compared with approximately 40% in the United States and 23% in the United Kingdom. Transactions of this nature provide rare access to operating assets at scale and are expected to support a gradual increase in institutional portfolio weightings to the sector.”