Global investment in alternative assets is expected to grow firmly, Mitsui says, with US real estate expected to remain as the largest and most attractive segment in the alternative investment market. This solidifies the firm's view that the US real estate environment will continue to be favorable mid-to-long term. In a release, Mitsui says that in its homeland, “due to poor performance caused by lasting low interest rates, Japanese investors' capital is expected to flow increasingly into overseas real estate and infrastructure investments.”

Under terms of the agreement, Mitsui will also commit capital to multiple CIM funds. “We are excited to partner with Mitsui to position CIM to be the first choice for Japanese investors interested in real estate and infrastructure investments in North America,” says Avi Shemesh, co-founder and Principal of CIM Group. “This partnership will allow CIM to better meet the growing needs of our investors.” Established in 1994, CIM manages private funds and public REITs primarily targeting urban real estate assets such as office buildings, retail centers and multifamily properties and infrastructure assets, mainly in North America.

For its part, Mitsui Fudosan in late 2014 paid $259 million for a stake in the massive Hudson Yards mixed-use project being developed by a partnership of Related Cos. and Oxford Properties; it has a 92% interest in the 55 Hudson Yards tower expected to open later this year. In Los Angeles, where CIM is headquartered, Mitsui Fudosan has a pair of apartment towers under development. It also has other US office, multifamily and hospitality assets in its portfolio through acquisition.

The Mitsui/CIM deal comes on the heels of Tokyo-based SoftBank's surprise announcement last week that it would acquire Fortress Investment Group for $3.3 billion. Although Fortress' spectrum of investments goes beyond real estate, it has long been known for its success in this arena. In a February 2015 profile of the company, PERE reported that when it came to real estate, “Fortress has found some of the most fertile ground for opportunistic and distressed investing coming out of the financial crisis.”

LOS ANGELES and TOKYO—In this month's second major Japanese investment into US-based real estate asset managers, Mitsui & Co. Ltd. will take a 20% stake in CIM Group LLC through a newly established special-purpose entity, Sabre Investments Ltd. Mitsui's total investment will be between $450 million and $550 million.

Although Mitsui has been active in US real estate investment and development through its Mitsui Fudosan America arm, the CIM investment marks the Tokyo-based conglomerate's entry into US real estate asset management. With about $19 billion in real estate assets under management, CIM will continue to be overseen and controlled by its founders and principals.

Mitsui will also strongly support marketing activities of CIM's funds to the Japanese market through Japan Alternative Investment Co., Ltd., Mitsui's wholly-owned subsidiary. The goal is to raise several hundred billion yen of new capital from Japanese investors in the coming years.

“Our investment in CIM was the culmination of a systematic search for a best-in-class manager in the real-asset management business,” says Tatsuo Yasunaga, president and CEO of Mitsui. “Investing in CIM is consistent with our strategic plan to expand Mitsui's real-asset management business to the US” and to enhance Mitsui's global AUM.

Global investment in alternative assets is expected to grow firmly, Mitsui says, with US real estate expected to remain as the largest and most attractive segment in the alternative investment market. This solidifies the firm's view that the US real estate environment will continue to be favorable mid-to-long term. In a release, Mitsui says that in its homeland, “due to poor performance caused by lasting low interest rates, Japanese investors' capital is expected to flow increasingly into overseas real estate and infrastructure investments.”

Under terms of the agreement, Mitsui will also commit capital to multiple CIM funds. “We are excited to partner with Mitsui to position CIM to be the first choice for Japanese investors interested in real estate and infrastructure investments in North America,” says Avi Shemesh, co-founder and Principal of CIM Group. “This partnership will allow CIM to better meet the growing needs of our investors.” Established in 1994, CIM manages private funds and public REITs primarily targeting urban real estate assets such as office buildings, retail centers and multifamily properties and infrastructure assets, mainly in North America.

For its part, Mitsui Fudosan in late 2014 paid $259 million for a stake in the massive Hudson Yards mixed-use project being developed by a partnership of Related Cos. and Oxford Properties; it has a 92% interest in the 55 Hudson Yards tower expected to open later this year. In Los Angeles, where CIM is headquartered, Mitsui Fudosan has a pair of apartment towers under development. It also has other US office, multifamily and hospitality assets in its portfolio through acquisition.

The Mitsui/CIM deal comes on the heels of Tokyo-based SoftBank's surprise announcement last week that it would acquire Fortress Investment Group for $3.3 billion. Although Fortress' spectrum of investments goes beyond real estate, it has long been known for its success in this arena. In a February 2015 profile of the company, PERE reported that when it came to real estate, “Fortress has found some of the most fertile ground for opportunistic and distressed investing coming out of the financial crisis.”