arburg Pincus announced two back-to-back acquisitions on April 2 and 3. On April 2, Warburg Pincus announced the acquisition of Tokyo Beta, one of Japan’s largest rental housing portfolios with over 16,000 rooms. This marks Warburg Pincus’ first investment in Japan’s living sector to capture growing demand for affordable rental housing.
Tokyo Beta is Japan’s largest portfolio of share houses. In Japan, a "share house" refers to a co-living space where multiple tenants share common facilities such as the kitchen, living room and bathroom while having their own private rooms.
The portfolio of assets will continue to operate under the Tokyo Beta brand. Tosei Asset Advisors, a leading real estate asset manager in Japan, has been entrusted to manage the portfolio.
On April 3, Warburg Pincus and Eastgate Group, one of Japan’s largest privately owned real estate investment managers, announced the acquisition of Shinagawa Seaside West Tower by their joint venture and the unveiling of the GRC brand for the JV’s properties. This acquisition represents the third transaction under the venture since its inception in 2023, expanding the portfolio to include high-quality innovation and R&D assets in both Yokohama and Tokyo.
In 2023, Warburg Pincus, through the Warburg Pincus Asia Real Estate Fund (WPARE), and Eastgate Group, through Eastgate Capital Management, established the JV to leverage their combined expertise to address the significant undersupply of specialist real estate for lease to tenants in the life sciences, hi-tech and manufacturing industries across Japan’s key cities.
With the Shinagawa Seaside acquisition, the joint venture now manages over 1 million sq ft of gross floor area and has over US$300 million of assets under management.
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The venture’s assets are strategically located in major innovation and R&D hubs, catering to a diversified tenant base across a wide range of industries seeking to attract and retain high-skilled talent. From designing and delivering bespoke spaces to managing specialised properties, GRC is committed to delivering state-of-the-art infrastructure, including a wide range of spaces with modular unit sizes and both dry and wet labs, to meet the evolving needs for high-quality, high-specification space of both international and domestic tenants.
In November 2023, the venture acquired its first asset, GRC Yokohama Bay Research Park, a 17-storey mixed-use commercial building spanning over 540,000 sq ft of gross floor area. The property currently houses a large number of tenants from specialist industries, such as engineering, technology, government research and manufacturing, offering base specifications suitable for both wet and dry lab use.
Building on the success of Yokohama Bay Research Park, the venture acquired the soon-to-be-renamed GRC Yokohama Science Cube in December 2024. This 78,000 sq ft facility, located adjacent to Center Kita Station in Yokohama, is set to be transformed into a cutting-edge R&D and medical facility.
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The latest acquired asset, Shinagawa Seaside West Tower, is an 18-storey commercial building in Tokyo’s Shinagawa district. It offers over 410,000 sq ft of gross floor area with superior structural specifications, capable of accommodating both dry and wet labs up to biosafety level 2.
Aligned with the venture’s strategy, GRC properties aim to deliver the consistent quality and service demanded by tenants operating critical on-site functions. Key features include customised spaces, dedicated mechanical and engineering riser spaces for ventilation, requisite water, gas and power provisions, heavy-duty floor loading and goods elevators and specialist building operations to accommodate the daily needs of tenants.
Takashi Murata, managing director, co-head of Asia real estate and head of Japan at Warburg Pincus, says: “We have built a high conviction in Japan’s life sciences and R&D real estate sector, which is underpinned by several secular trends including a rapidly aging population, strong growth in the healthcare market, and a significant shortage of R&D and lab space for lease. Both Warburg Pincus and Eastgate are early-movers in the life sciences and R&D space with over 20 years of combined experience in investing in and managing such assets. By leveraging Warburg Pincus’ deep platform-building experience and operational expertise and Eastgate’s strong track record and local resources, we believe that GRC is well-positioned to meet the evolving needs for high-quality, specialised life sciences and R&D facilities in Japan among a diversified group of tenant base.”
On the rental housing front, Murata adds: "In the coming decade, the population in Tokyo is projected to continue to grow, driven by the influx of domestic and international young workforce and students, creating significant demand for affordable rental accommodation options. Limited housing supply has been pushing residential rental rates up by 5% per annum over the last three years, while occupancy rates are at a record high of over 97%, highlighting the structural demand and supply gaps in Tokyo.”
