Basic Strategy of One REIT
- Investment focusing on Middle-sized Office
Investment and management from a long-term view
- Careful selection of investment area
- Creation of buildings chosen by tenants
- Utilization of sponsor support
One REIT will mainly invest in and manage Middle-sized Offices situated at excellent locations and with certain specifications by focusing on the “essential value” of real estate.
What is “Middle-sized Office”?
Middle-sized Office is a category of office building with a total floor area within the range of 3,300 m² (approximately 1,000 tsubos) to 33,000 m² (approximately 10,000 tsubos) as well as medium or medium- to large-scale office buildings with certain specifications that satisfy the needs of tenants.
Characteristics of “Middle-sized Office”: Having a large number of stock in the market; high liquidity in transaction; and low volatility in unit rent and occupancy rate.
SIA Group, to which the asset management company of One REIT belongs, has a substantial track record in investment and management with Middle-sized Office including private fund business and self-leasing business and also has the capability to judge competitive properties as well as a high-quality operational capability.
Middle-sized Office has an abundance of stock in the market while several have already reached a certain age, and there are many properties in the market that cannot fully utilize their competitiveness. Therefore, One REIT considers Middle-sized Office as an investment target it can distinguish from the rest and in which it can pursue the maximization of unitholder value by demonstrating its “added value creation capability.”
|（※）||Middle-sized: neither very large nor very small（from LONGMAN dictionary of contemporary English）|
- 1Abundant stock+-
Middle-sized Office buildings (total floor area within the range of 3,300 m² (approximately 1,000 tsubos) to 30,000 m² (approximately 10,000 tsubos)) and equivalent properties (generally between 3,000 m² or more and less than 30,000 m²) will account for 57% of the total number of properties in the 23 wards of Tokyo when considering properties with an area of 2,000 m² or more as investment target stock of general investment corporations from the viewpoint of investment efficiency. We believe that there is abundant opportunity to invest in prime properties as there are more Middle-sized Office buildings than ultra-large-scale office buildings with an area of 30,000 m² or more and small- and medium-scale office buildings with an area of 2,000 m² to 3,000 m².
Source: Prepared by the asset management company of One REIT based on the material made by Urban Research Institute Corporation based on the “Annual Report on Construction Statistics in Tokyo.”
- 2High liquidity+-
We believe that we can flexibly respond to the acquisition and sales of properties as there are more transactions of Middle-sized Office buildings (total floor area within the range of 3,300 m² (approximately 1,000 tsubos) to 30,000 m² (approximately 10,000 tsubos)) and equivalent properties (generally between 3,000 m² or more and less than 30,000 m²) that are considered as investment and management targets by One REIT in the 23 wards of Tokyo than that of office buildings of other scale.
Number of Office Building Transactions by Scale
Source: Prepared by the asset management company of One REIT based on the “Actual Survey on Real Estate Transaction” by Urban Research Institute Corporation.
Among properties owned by J-REITs, the average occupancy rate and unit rent revenue of properties （generally between 3,000㎡ or more and less than 30,000㎡）equivalent to Middle-sized Office buildings (office buildings whose total floor area is within the range of 3,300㎡ (approximately 1,000 tsubos) to 33,000㎡ (approximately 10,000 tsubos)) that are invested and managed by One REIT remain stable compared to office buildings of other scales.
Average Occupancy Rate by Scale
Unit Rent Revenue by Scale
Source: Prepared by the Asset Management Company of One REIT based on “ReiTREDA” of Urban Research Institute Corporation
Investment and management from a long-term view
Investment in properties whose values are maintained and enhanced
We consider “location” and “specification” as the top priority in investment in order to maintain and enhance the value of real estate from a medium- to long-term view by utilizing the knowledge and experience of the asset management company.
Management for maintaining and enhancing value
We intend to secure stable income and achieve sustainable growth of assets under management and maximize the interest of unitholders by continuously maintaining and improving building functions through appropriate maintenance to maintain and enhance building value and cash flow.
|●||The value of buildings will inevitably deteriorate due to aging but it is possible to maintain and enhance value through appropriate maintenance.|
|●||We will “invest in properties whose values can be maintained and enhanced” and “conduct management by considering maintenance and enhancement as the top priority” to maintain and enhance the value in investment and management.|