GLP sells four Japan properties to GLP J-REIT to the tune of US$420m

The sum is 3% higher than latest appraisal values.

GLP is parting ways with four Japan properties in a JPY42.7 billion (US$420m) deal with GLP J-REIT.

According to the company’s news release, the sale price is 3% higher than the latest appraisal values and equates to a weighted average cap rate of 4.8%.

This comes hot on the heels of the announced sale of GLP’s 50% stake in GLP MFLP Ichikawa Shiohama to GLP J-REIT earlier in 2016.

“GLP expects to realize US$130 million of cash profit from these dispositions upon completion in September 2016. This includes the crystallization of US$100 million of development profit (GLP share, pre-tax) from three development projects—GLP Atsugi II, GLP Yoshimi and GLP MFLP Ichikawa Shiohama—which are 100% leased and generated a development profit margin of 44%,” the company stated.

Net sale proceeds for GLP are estimated to hit roughly JPY26b (US$254m), which the company plans to reinvest into development in Japan. The dispositions of the five assets also drummed up a net levered property IRR (internal rate of return) of 27% before fees and promotes.

The company further stated that China and Japan represent the most attractive spaces for development, and that GLP will deploy most of its capital to these markets.