TOKYO—Germany's Union Investment Real Estate has acquired the J6 Front commercial building here for around $172 million (EUR 127M). The seller is a Singapore based investment company, Alpha Investment Partners.

Totaling 4,939 sq m of rental space, the class A building is fully leased to six Japanese companies. The eight-story property was completed in November 2008 and enjoys a central location in the established commercial submarket of Jingumae within the central Shibuya Ward. The area is dominated by IT, telecommunications, apparel and service companies, and the property has the added advantage of being adjacent to two busy shopping streets, Meiji-dori and Omotesando. J6 Front will broaden the international mix of open-ended real estate fund UniImmo: Europa, which already holds another office property in Tokyo. In total, Union Investment now holds 13 properties in the Asia Pacific region with a current value of some $1.1 billion (EUR 850M). Touchstone Capital Group advised Union Investment on the transaction.

"Rents in the Tokyo office property market are at a low level in terms of the economic cycle. Since rents are expected to increase going forward, this is the right time for investors to enter the market," said Martin Br hl, head of Investment Management International at Union Investment. Accordingly, Union Investment intends to use the window of opportunity offered by the current upturn to make further investments in the world's biggest office property market. "Despite intense competition for good products, especially from J-REITS, the depth of the market continues to enable investment by foreign players," added Br hl.