Diamond Realty To Set Up Real Estate Debt Funds

Mitsubishi Corp. (8058) 's wholly owned subsidiary Diamond Realty Management Inc. will set up an 11.3 billion yen private real estate mezzanine loan fund backed by eight investors, including a domestic pension fund, life insurer and regional bank.
The fund will invest in the mezzanine debt of large rental condominiums in Tokyo and commercial buildings in the city's Ginza and Ometesando districts. The fund is projected to yield a 5-6% annual return to attract institutional investors looking for alternatives to government bonds. Mitsubishi also plans to establish a second fund of 15-20 billion yen later this fiscal year.