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The Chinese are coming!!!   We are now seeing investors from the only major country relatively unaffected by the recent strengthening of the JPY arrive for bargain sales in the real estate equity markets.

Pacific Holdings (8902) was up 18% today (Website Here) on the announcement of a financial and management tie-up effectively giving management control to a group of unnamed major Chinese real estate companies and investors.  The market cap still JPY 1.8 Billion (USD 18 Million) – down 98% to date!!

Details of the proposed deal involve the group, represented by a Japanese investment platform KK Chuhaku Japan, a wholly owned subsidiary of Industrial Growth Platform Inc (IGPI), taking a 29% stake in common shares on the 19th of December, investing in 47 billion yen of class A preferred shares to be newly issued on the 26th of December and taking an issuance of new short-term (1 yr) nonguaranteed, uncollateralized corporate debt in the amount of 27 billion yen at the end of February.

Chuhaku Japan will effectively be given control of the board of directors and the right to select the new representative director and president of the company.   They are beginning discussions to create a new private real estate fund and retool the company management.

The Nippon Residential REIT (8962) stock price responded quickly to the news at 9% up but Nippon Commercial REIT (3229) did not respond as much up 1.6% today. (click for stock prices).


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