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Rental housing service provider Dash Living has acquired a multifamily asset in Tokyo, Japan, together with BlackRock Real Estate. The deal, completed through a joint venture (JV) between the two parties, was dedicated to seeking “value-added rental uplift opportunities” targeting business travellers and tourists to Japan.
Aaron Lee, chief executive officer (CEO) at Dash Living, told FinanceAsia that the team targets three to five times rental uplift, compared with traditional rents. This occurs through investment in the property such as furniture, fixtures, equipment and branding, and the integration of Dash Living’s serviced apartment experience and centralised booking management technology. After costs, the net uplift is more like two to three times.
A multifamily property refers to one that accommodates more than one housing unit in a single building. The acquired property (pictured) is located in Higashi Komagata with 29 units, according to a July 30 press release from Dash Living.
The acquisition amount and JV shareholding between the two parties remain confidential.
Japan opportunity
The property is the first multifamily asset acquired by Dash Living in Tokyo, after the Hong Kong-headquartered firm entered the Japanese market two years ago. It becomes the fifteenth Japanese location in its portfolio.
Dash Living has made “significant” investments in the Japanese market, the release stated. Lee told FA that the team has completed exits of four locations in Japan out of the fifteen, with average delivered returns on investment at 15-30%.
He attributed a boom in Japan’s tourism as a major factor behind the team’s commitment to the market – with the authorities setting a target of attracting 60 million inbound tourists annually, and over 17.7 million travellers visited Japan in the first half of 2024, signalling a recovery to pre-pandemic levels.
A relatively weak Japanese yen, as well as a favourable interest rate environment in Japan, has also contributed to momentum in both tourism and institutional investment into the market.
The acquired property is located within five-minute walks to major subway lines, and is 20 to 30 minutes away from several central business districts in Tokyo. It is also near the touristy Asakusa area.
“Half of our operations in Japan are around tourism, with the other half targeting customers on business trips or longer monthly stays in Japan,” Lee explained.
The firm’s previous acquisitions in Japan have seen collaborations with other large real estate investment names, including Schroders and PGIM Real Estate. This transaction marks its first collaboration with BlackRock, the world’s largest asset manager.
Lee said the team is hoping to establish an ongoing relationship with BlackRock and other partners, with “a couple more” deals in the pipeline over the next few months, with Japan being a key market, and receiving “the most interest”.
"Japan's real estate market for multifamily assets is highly attractive and offers substantial opportunities given the surge in business travel and tourism,” Daigo Hirai, managing director, head of Japan Real Estate at BlackRock, commented in the press release.
Other Asia Pacific (Apac) locations for Dash Living include regional hub cities such as Hong Kong, Singapore and Sydney. A high level of inbound travel; a group of tech-savvy millennial customers; and expensive accommodation to provides pricing opportunities, are some strategic considerations for locations, according to Lee.
Dash Living is backed by several venture capital firms including MindWorks Ventures, Grosvenor and Taronga Ventures.
