Bain, KKR Among Bidders for Sapporo Real Estate

Sapporo Holdings’ real estate business is heading toward new ownership.

Three separate groups, including entities like Bain Capital and KKR, are preparing to bid for the Japanese company’s real estate business, with the sale price expected to be around 400 billion yen, or $2.7 billion, Reuters reported.

Lone Star and Kenedix; Bain and Tokyu Fudosan; and KKR, PAG and Nomura Real Estate are all vying for ownership of the company. Mitsubishi Estate was also among those considering bidding but has withdrawn from the process.

Sapporo is in talks with multiple companies regarding the injection of external capital into its real estate business. The company plans to determine a path forward by the end of the year, a spokesperson told Reuters. At one point, Sapporo had reportedly received proposals from more than 10 companies.

Sapporo, known globally for its core business of beer production, has reportedly been under pressure by investors to sell off its real estate holdings in hopes to improve its bottom line.

Singapore-based 3D Investment Partners purportedly urged the brewer to improve capital efficiency and separate its real estate business. The brewer is planning to turn its focus away from real estate and expand its beverage business.

The crown jewel of Sapporo’s real estate business is Yebisu Garden Place, a mixed-use complex in Tokyo boasting offices, housing and retail. The value of the sale could change depending on how much redevelopment needs to be done, as well as other factors, according to Reuters.

Sapporo Real Estate Company was established in 1988 to manage the real estate business of the Sapporo Group. It develops businesses concentrated in areas like Ebisu and Ginza in Tokyo and the cities of Sapporo and Nagoya.

Bidders looking to get in on Sapporo’s holdings will have to act fast in the coming weeks. The deadline for submitting bids in the second round of the process is scheduled for August. The final buyer will be granted exclusive negotiation rights with the sale likely to be finalized in November.

— Chris Malone Méndez