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ESR completes closings of US$1.2 billion of equity for Japan developments

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ESR completes closings of US$1.2 billion of equity for Japan developments

ESR, a leading pan-Asia logistics real estate developer, owner and operator, announced that it has completed the fund raise of its most recent Japan fund with a total tally in excess of its US$500 million target, which when combined with closed co-investment vehicles totals US$1.2 billion of equity closings for new Japan developments.

RJLF2 (Redwood Japan Logistics Fund 2) recently conducted its final closing increasing total discretionary fund commitments to US$575 million after an existing LP – German insurance company Allianz – upsized its earlier commitment to a total circa US$185 million. Other RJLF2 investors include a leading Southeast Asian pension fund which made a US$200 million inaugural fund commitment, State Oil Fund of Azerbaijan (SOFAZ), a fund managed by Aviva Investors, and a German pension fund advised by Mercer, which is already invested with ESR in the predecessor fund RJLF1.

Projects undertaken by RJLF2 have also attracted co-investment capital from a leading US pension fund, a major Asian insurance company, Equity International and long-time partner PGGM. RJLF2 and the related co-investment capital have allowed ESR to capitalize up to US$3 billion worth of developments of which circa 70% is already committed to nine projects. ESR’s current Japan pipeline suggests full commitment will be achieved in 2019.

RJLF2 is an ESR-managed, discretionary vehicle investing in state-of-the-art logistics real estate in Tokyo, Osaka and Nagoya. The fund makes disciplined investments into the development of modern warehouses located in the urban locations most in demand with the expanding set of e-commerce tenants and leading 3rd-party logistics providers (3PLs).

“RJLF2 has provided several key ESR relationship and first-time investors in Japan logistics real estate a vehicle to access rare institutional quality development opportunities. While we expect large club vehicles to remain prevalent in Asia logistics real estate, we are intent where possible on making development opportunities in ESR markets accessible to discretionary capital in a range of investment sizes,” commented Pierre-Alexandre Humblot, ESR Head of Private Capital.

Charles de Portes, ESR President, and Stuart Gibson, ESR Co-CEO and head of the Japan operations, added, “The RJLF2 fund closing with its blue-chip roster of equity investors and co-investors, is one of the largest in Japan for the sector to date and a strong validation of the investment strategy. As the fund continues its rapid deployment in progress of RJLF2, we expect the combined ESR portfolio of prime logistics properties stabilized and under development in Japan to grow to over US$5 billion in value in the next two years. We are confident that the state-of-the-art developments of the fund, incorporating the latest in green technologies and seismic design, will provide our investors with superior long-term returns. These returns are further enhanced by secular occupier demand for large multi-tenanted facilities, the accommodative debt environment specific to Japan and active asset management by ESR’s local management team, one of the most experienced in the nation operating on the ground in the sector for over two decades.”

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Oil set for steady gains as economies shake off pandemic blues – Reuters poll

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Oil set for steady gains as economies shake off pandemic blues - Reuters poll 1

By Sumita Layek and Bharat Gautam

(Reuters) – Oil prices will stage a steady recovery this year as vaccines reach more people and speed an economic revival, with further impetus coming from stimulus and output discipline by top crude producers, a Reuters poll showed on Friday.

The survey of 55 participants forecast Brent crude would average $59.07 per barrel in 2021, up from last month’s $54.47 forecast.

Brent has averaged around $58.80 so far this year.

“Travel and leisure activity look set to catch up to buoyant manufacturing activity due to the mix of stimulus, confidence, vaccines, and more targeted pandemic measures,” said Norbert Ruecker of Julius Baer.

“Against these demand dynamics, the supply side is unlikely to catch up on time, leaving the oil market in tightening mode for months to come.”

Of the 41 respondents who participated in both the February and January polls, 32 raised their forecasts.

Most analysts said the Organization of Petroleum Exporting Countries and allies (OPEC+) may ease current output curbs when they meet on March 4, but would still agree to maintain supply discipline.

“With OPEC+ endeavouring to keep global oil production below demand, inventories should continue falling this year and allow prices to rise further,” said UBS analyst Giovanni Staunovo.

Oil demand was seen growing by 5-7 million barrels per day in 2021, as per the poll.

However, experts said any deterioration in the COVID-19 situation and the possible lifting of U.S. sanctions on Iran could hold back oil’s recovery.

The poll forecast U.S. crude to average $55.93 per barrel in 2021 versus January’s $51.42 consensus.

Analysts expect U.S. production to rise moderately this year, although new measures from U.S. President Joe Biden to tame the oil sector could curb output in the long run.

“A structural shift away from fossil fuels” may prevent oil from returning to the highs of previous decades, said Economist Intelligence Unit analyst Cailin Birch.

(Reporting by Sumita Layek and Bharat Govind Gautam in Bengaluru; Editing by Arpan Varghese, Noah Browning and Barbara Lewis)

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Japan’s jobless rate seen up in January due to COVID-19 emergency measures – Reuters poll

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Japan's jobless rate seen up in January due to COVID-19 emergency measures - Reuters poll 2

TOKYO (Reuters) – Japan’s jobless rate is expected to have edged up in January as service industry businesses suffered renewed restrictions on movement to fight spread of the coronavirus in some areas, including Tokyo, a Reuters poll of economists showed on Friday.

While industrial production activity picked up in Japan, emergency curbs rolled out last month such as asking restaurants to close early and suspending the national travel campaign hurt the jobs market, analysts said.

The nation’s unemployment rate likely rose 3.0% in January, up from 2.9% in December, the poll of 15 economists found.

The jobs-to-applicants ratio, a gauge of the availability of jobs, was seen at 1.06 in January, unchanged from December, but stayed near September’s seven-year low of 1.03, the poll showed.

“As the impact from the coronavirus pandemic prolongs, it is hard for firms, especially the service sector, to expect their business profits to improve,” said Yusuke Shimoda, senior economist at Japan Research Institute.

“So, their willingness to hire employees appear to be subdued and it is difficult to see the jobs market recovering soon.”

Some analysts also said the government’s steps to support employment and existing labour shortages will likely prevent the jobless rate from worsening sharply.

The government will announce the labour market data at 8:30 a.m. Japan time on Tuesday (2330 GMT Monday).

Analysts expect the economy to contract in the current quarter due to the emergency measures to counter the spread of the disease.

(Reporting by Kaori Kaneko; Editing by Simon Cameron-Moore)

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China’s economy could grow 8-9% this year from low base in 2020 – central bank adviser

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China's economy could grow 8-9% this year from low base in 2020 - central bank adviser 3

BEIJING (Reuters) – China’s gross domestic product (GDP) could expand 8-9% in 2021 as it continues to rebound from the COVID-19 pandemic, Liu Shijin, a policy adviser to the People’s Bank of China, said on Friday.

This speed of recovery would not mean China has returned to a “high-growth” period, said Liu, as it would be from a low base in 2020, when China’s economy grew 2.3%.

Analysts from HSBC this week forecast that China would grow 8.5% this year, leading the global economic recovery from the pandemic.

If 2020 and 2021’s average GDP growth is around 5%, this would be a “not bad” outcome, said Liu, speaking at an online conference.

China is set to release a government work report on March 5 which typically includes a GDP growth target for the year.

Last year’s report did not include one due to uncertainties caused by the coronavirus. Reuters previously reported that 2021’s report will also not set a target.

(Reporting by Gabriel Crossley and Muyu Xu; Editing by Sam Holmes and Ana Nicolaci da Costa)

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