ARES J-REIT REPORT
Vol.43
June 2013
Market Overview (As of May 31, 2013)
(1 USD = 100.46 JPY)
Tokyo Stock Exchange REIT Index
Price Return
Total Return
Indices
TSE REIT
TOPIX
1 month
- 14.2%
- 2.5%
REIT Property Sector Index Series
(MoM)
Office
(MoM)
1,374.30 (-17.9%)
Residential
1,368.17 (-14.5%)
1,746.60
(-9.4%)
Retail & Logistics, etc.
2,226.11 (-14.2%)
1,750.36
(-9.8%)
Total Returns
3 months
+ 4.1%
+ 17.5%
6 months
+ 31.0%
+ 46.9%
1 year
+ 54.6%
+ 61.4%
2 years
+ 41.9%
+ 41.8%
5 years
+ 19.0%
- 10.4%
10 years
+ 100.1%
+ 59.9%
Average
Dividend Yield
3.9%
¥6,080.7 bn
($60.5 bn)
REIT Property Transactions in May
Market Cap
(39 REITs)
Acquisitions
¥390.9 bn
($3.9 bn)
Dispositions
¥6.5 bn
($0.1 bn)
Nomura Real Estate Master Fund lists ¥227 billion logistics / retail portfolio
Nomura Real Estate Master Fund, Inc. (“NMF”), a real estate investment trust which focuses on investing in logistics and
retail properties, started trading on the Tokyo Stock Exchange under the code “3285” on June 12. The REIT is sponsored by
Nomura Real Estate Development and managed by Nomura Real Estate Asset Management.
NMF plans to invest more than 80% of its assets in Greater Tokyo properties. The REIT’s initial portfolio consists of ¥227.6
billion ($2.27 billion) worth of properties, comprising 18 logistics (¥122.0 billion) and 36 retail (¥105.6 billion) assets. The
890,800-square-meter portfolio had an occupancy rate of 99.9% as of January 31, 2013.
Ahead of its debut on the TSE, NMF sold 1,663,260 newly issued units and 87,540 over-allotment units at an initial public
offering price of ¥100,000 per unit. The deal totaled ¥175 billion ($1.74 billion), making it the largest ever REIT IPO in Japan.
Nomura Securities acted as the sole global coordinator for the offering.
Nippon Prologis REIT acquires eight Class-A logistics properties for ¥ 132 billion
Nippon Prologis REIT, Inc. (TSE code: 3283, “NPR”) has acquired a 593,400-square-meter portfolio of eight Class-A logistics
facilities in the Kanto (Tokyo) and Kansai (Osaka) areas for ¥132.4 billion ($1.32 billion). The portfolio, with a weighted
average age of 5.0 years, comprises six properties from Prologis Japan Fund 1 and two additional properties acquired from
Prologis' wholly owned Japan portfolio. With this acquisition, NPR now owns 20 Class-A properties valued at ¥305.4 billion
($3.04 billion).
To finance a portion of the deal, NPR completed a public offering of 96,200 units at a price of ¥763,420 per unit, raising ¥71.1
billion ($708 million) in net proceeds after deducting the underwriting discounts. The offering comprised a domestic placement
of 57,720 units and an international placement of 38,480 units. Prologis will retain at least a 15% ownership interest in NPR.
J-REITs plunged over 14% in May
Tokyo Stock Exchange REIT Index
The Tokyo Stock Exchange REIT Index fell sharply by 14.5% in May,
marking the third biggest monthly decline in its history. The sell-off in
J-REITs was partly attributable to a sudden rise in long-term interest rates;
the yield on the benchmark 10-year Japanese government bond jumped to
a more than one-year high of 1.0% on May 23 from 0.6% at the end of April.
The TOPIX Real Estate Index, which tracks real estate stocks (not including
REITs) listed on the TSE, dropped further in May, plummeting 16.4%.
1,800
1,600
1,400
1,200
1,000
Mar
Apr
May
Ichigo Real Estate Investment Corporation (TSE code: 8975) has acquired an 8,289-square-meter office building
near Akihabara, Tokyo and another two properties in Osaka for a total price of ¥8.65 billion ($86 million). The
diversified REIT issued 90,000 units in a public offering to raise proceeds of ¥5.43 billion ($54 million), which has been used
to help fund the acquisition of the properties.
Hankyu REIT, Inc. (TSE code: 8977) will purchase two retail properties in Osaka for ¥9.97 billion ($99 million). The
properties include 64,232-square-meter land in Sakai, southern Osaka, on which a regional shopping center AEON MALL is
located. The Osaka-based REIT plans to fund the acquisition with the proceeds from the issuance of investment units.
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《 Market Indices 》
TSE REIT Index and TOPIX (March 31, 2003 ~ May 31, 2013)
Tokyo Stock Exchange REIT Index (Price Return)
3,000
800
TSE REIT Index
3,500
700
3,000
600
2,500
500
2,000
REIT
400
Volume
('000)
1,500
TSE REIT (Total Return)
TSE REIT (Price Return)
TOPIX (Total Return)
TOPIX (Price Return)
TOPIX
2,500
TOPIX Real Estate
2,000
1,500
300
200
1,000
1,000
500
100
0
500
Jun-11
0
Sep-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
Mar-13
Base Value/Base Date: 1,000 as of March 31, 2003 Source: Bloomberg
Source: Bloomberg
Tokyo Stock Exchange REIT Property Sector Index Series
Tokyo Stock Exchange REIT Index (Total Return)
300
180
250
TSE REIT Index
170
Office
TOPIX
160
Residential
TOPIX Real Estate
150
Retail & Logistics, Others
140
200
130
120
150
110
100
100
90
80
50
Jun-11
Sep-11
Dec-11
100 as of May 31, 2011
Mar-12
Jun-12
Sep-12
Dec-12
70
Jun-11
Mar-13
Sep-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
Price only returns. 100 as of May 31, 2011 Source: Bloomberg
Source: Bloomberg
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Mar-13
No. of REITs Number / Market Cap / Asset Value of Listed J-REITs trillion yen
55
11
Assets (Acquisition Price)
50
10
Market Capitalization
45
9
Number of REITs
Average Dividend Yield of J-REITs
7.0%
6.0%
J-REITs
4.0%
Yield Spread
between J-REITs and 10y-JGB
3.0%
2.0%
Average Yield of Stocks on TSE 1st Section
1.0%
10-year JGB (Japanese Government Bond) Yield
0.0%
Jun-11
Sep-11
Dec-11
Mar-12
Jun-12
Sep-12
Dec-12
7
30
6
25
5
20
4
15
3
10
2
5
1
0
2002
Mar-13
Capital Flows into and out of J-REIT Funds
190
Net Inflows
1.8
180
Total Net Assets
1.6
1.4
1.2
60
1.0
40
0.8
20
0.6
0.4
-20
0.2
-40
0.0
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
0
Japanese investment trusts (mutual funds) focused on J-REITs
Source: The Investment Trusts Association of Japan
2005
2006
2007
2008
2009
2010
2011
2012
2013
Global REIT Performance
2.0
80
1
2004
1
Total Net Assets (JPY trillion)
100
0
2003
Sources: ARES, Tokyo Stock Exchange, The Investment Trusts Association of Japan
140
120
8
35
Sources: ARES, Bloomberg
Net Inflows (JPY billion)
Assets (Appraised Value)
40
5.0%
(100 as of May 31, 2012, Price only returns in local currency)
170
160
150
Japan
140
HK
France
UK
Singapore
Australia
US
130
120
110
Canada
100
90
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Japan: TSE REIT Index, US：FTSE NAREIT All Equity REITs Index, France：FTSE EPRA/NAREIT
France Index, Australia: S&P/ASX 200 A-REIT Index, UK: FTSE EPRA/NAREIT UK Index, Canada:
S&P/TSX Capped REIT Index, Singapore: FTSE ST REIT Index, HK: HS REIT Index Source: Bloomberg
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《 Trading Data of J-REIT Units on Tokyo Stock Exchange 》
Cumulative Net Buying (Selling) by Investor Type
Net Buying (Selling) by Investor Type1
1 year: May. 2012 - Apr. 2013
¥100
Investment Trusts
181.3
Investment Trusts
155.9
Foreigners
Foreigners
75.5
Foreigners
82.3
Banks (ex-BoJ)
58.7
Banks (ex-BoJ)
47.1
Bank of Japan
57.2
Bank of Japan
22.7
Others
2.4
Others
3.3
Securities Companies
(7.2)
Securities Companies
(7.3)
Life ＆ Non Life
(7.9)
Life ＆ Non Life
(12.3)
Others (financial)
(21.2)
Others (financial)
(23.2)
Business Companies
(46.4)
Business Companies
(41.9)
Individuals
(303.4)
Individuals
(231.5)
Securities Cos.
¥50
Investment Trusts
Business Cos.
¥0
Others
Banks (ex-BoJ)
(¥50)
Bank of Japan
Life ＆ Non Life
(¥100)
Others (financial)
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
(¥150)
1
Note: Billions of yen
Sources: Tokyo Stock Exchange, Bank of Japan
Brokerage trading on the TSE Sources: Tokyo Stock Exchange, Bank of Japan
Trading Volume & Value
Trading Share by Investor Type1
6.0
60%
Securities Cos.
40%
Investment Trusts
30%
Business Cos.
Others
20%
Banks
Life ＆ Non Life
10%
5.0
¥1.2
Trading Value (RHS)
¥1.0
4.0
¥0.8
3.0
¥0.6
2.0
¥0.4
1.0
¥0.2
0.0
¥-
1
Based on brokerage trading value on the TSE
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Others (financial)
0%
Source: Tokyo Stock Exchange
Source: Tokyo Stock Exchange
4/6
Trading Value (in trillions)
Foreigners
¥1.4
Trading Volume (LHS)
Individuals
50%
May-11
Jun-11
Jul-11
Aug-11
Sep-11
Oct-11
Nov-11
Dec-11
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
Net Selling ←
6 months: Nov. 2012 - Apr. 2013
Individuals
Trading Volume (million units)
→ Net Buying
¥150 billion
《 ARES Japan Property Index – AJPI – 》
Please visit our AJPI website (http://index.ares.or.jp/index-en.php) for details. AJPI Index data are available for download at http://index.ares.or.jp/download-ajpi-en.php
Capital Return (National)
Total Return (National)
1,300
1,900
1,800
Office
1,200
All Properties
1,700
Office
1,600
Retail
1,100
1,500
All Properties
Retail
1,400
1,000
1,300
Residential
1,200
900
1,100
1,000
Residential
800
900
700
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12
Source: ARES
800
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12
Source: ARES
Occupancy Rate (National)
100%
9.00
thousand Yen per sqm
Average Rent (National)
Retail
8.00
95%
Residential
90%
7.00
Office
All Properties
Office
6.00
5.00
85%
4.00
3.00
80%
2.00
Residential
All Properties
Retail
75%
1.00
0.00
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12
Source: ARES
70%
Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12
Source: ARES
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《Listed 39 J-REITs》
As of May 31, 2013 / Ranked by market capitalization
Price Returns
TSE
Code
REIT
1 month
6 months
1 year
Market
Cap
Unit Price
Property Portfolio
Asset Size
No. of
Assets
Sector
8951 Nippon Building Fund
¥1,045,000
- 25.5%
+ 21.1%
+ 46.2%
¥723.1 bn
¥1,066.4 bn
74
Office
8952 Japan Real Estate
¥1,003,000
- 23.2%
+ 23.8%
+ 44.9%
¥595.9 bn
¥782.4 bn
60
Office
8953 Japan Retail Fund
¥192,000
- 16.9%
+ 28.0%
+ 55.7%
¥399.2 bn
¥720.3 bn
76
Retail
8960 United Urban
¥130,400
- 18.8%
+ 39.5%
+ 54.0%
¥300.6 bn
¥471.2 bn
97
Office / Retail, etc.
3269 Advance Residence
¥210,300
- 9.8%
+ 21.6%
+ 45.4%
¥260.7 bn
¥393.8 bn
204
Residential
8955 Japan Prime Realty
¥315,500
- 11.9%
+ 29.4%
+ 41.0%
¥260.2 bn
¥398.6 bn
60
Office / Retail
8964 Frontier Real Estate
¥933,000
- 6.3%
+ 32.3%
+ 39.0%
¥231.3 bn
¥271.6 bn
29
Retail
8961 MORI TRUST Sogo Reit
¥805,000
- 15.0%
+ 16.3%
+ 20.3%
¥194.8 bn
¥327.3 bn
16
Office / Retail, etc.
8959 Nomura Real Estate Office Fund
¥577,000
- 7.2%
+ 16.9%
+ 32.0%
¥176.0 bn
¥372.1 bn
50
Office
8954 ORIX JREIT
¥110,000
- 16.4%
+ 33.3%
+ 57.1%
¥175.0 bn
¥383.0 bn
73
Office / Retail, etc.
3281 GLP J-REIT
¥93,800
- 6.6%
-
-
¥172.3 bn
¥221.3 bn
33
Industrial (Logistics)
3279 Activia Properties
¥772,000
- 7.5%
+ 51.1%
-
¥158.4 bn
¥181.2 bn
20
Retail / Office
8976 Daiwa Office
¥394,000
- 15.0%
+ 47.9%
+ 102.6%
¥155.9 bn
¥332.0 bn
41
Office
3234 Mori Hills REIT
¥601,000
- 11.2%
+ 42.8%
+ 88.7%
¥153.0 bn
¥230.8 bn
3283 Nippon Prologis REIT
¥823,000
- 8.7%
-
-
¥150.4 bn
¥173.0 bn
12
3249 Industrial & Infrastructure Fund
¥941,000
- 9.1%
+ 47.7%
+ 93.4%
¥147.2 bn
¥163.8 bn
29 Industrial, Infrastructure
3226 Nippon Accommodations Fund
¥637,000
- 15.6%
+ 8.3%
+ 24.7%
¥146.9 bn
¥259.7 bn
8967 Japan Logistics Fund
¥942,000
- 10.6%
+ 30.7%
+ 35.5%
¥139.4 bn
8984 Daiwa House Residential
¥391,500
- 5.7%
+ 24.3%
+ 46.6%
¥137.7 bn
8987 Japan Excellent
¥587,000
- 11.6%
+ 27.3%
+ 40.4%
8972 Kenedix Realty
¥390,000
- 14.8%
+ 42.6%
8968 Fukuoka REIT
¥773,000
- 6.2%
+ 27.8%
¥39,650
- 3.8%
¥593,000
- 4.4%
8985 Japan Hotel REIT
8957 TOKYU REIT
8986 Japan Rental Housing
9 Office / Residential, etc.
Industrial (Logistics)
102
Residential
¥165.1 bn
32
Industrial (Logistics)
¥218.4 bn
125
Residential
¥132.0 bn
¥245.5 bn
28
Office
+ 51.6%
¥111.7 bn
¥290.9 bn
82
Office, etc.
+ 36.6%
¥106.6 bn
¥163.4 bn
23
Retail / Office, etc.
+ 64.6%
+ 94.8%
¥103.9 bn
¥156.9 bn
29
Hotel
+ 33.6%
+ 51.5%
¥100.4 bn
¥204.2 bn
27
Retail / Office
+ 28.3%
+ 91.5%
¥93.0 bn
¥156.2 bn
177
Residential
-
¥87.2 bn
¥117.0 bn
25
Logistics / Retail
¥69,900
- 8.3%
3263 Daiwa House REIT
¥712,000
- 2.5%
3240 Nomura Real Estate Residential Fund
¥524,000
- 13.1%
+ 13.2%
+ 34.4%
¥79.0 bn
¥150.9 bn
152
Residential
8956 Premier
¥394,500
- 12.6%
+ 31.5%
+ 36.2%
¥77.5 bn
¥199.4 bn
55
Office / Residential
8973 Sekisui House SI
¥476,500
- 4.2%
+ 25.9%
+ 45.3%
¥76.0 bn
¥144.1 bn
89
Residential / Retail
8982 TOP REIT
¥454,500
- 12.9%
+ 23.0%
+ 3.3%
¥70.4 bn
¥185.5 bn
19
Office / Retail, etc.
¥61,800
- 3.1%
+ 40.9%
+ 79.4%
¥57.6 bn
¥104.3 bn
66 Office / Residential, etc.
8958 Global One Real Estate
¥583,000
- 11.4%
+ 16.8%
+ 14.1%
¥56.4 bn
¥156.9 bn
8966 Heiwa Real Estate REIT
¥68,500
- 14.6%
+ 26.9%
+ 58.2%
¥54.4 bn
¥138.2 bn
3282 Comforia Residential REIT
¥694,000
- 3.5%
-
-
¥46.7 bn
¥71.2 bn
53
Residential
8977 Hankyu REIT
¥539,000
- 16.3%
+ 36.6%
+ 50.3%
¥46.0 bn
¥116.1 bn
16
Retail / Office, etc.
3227 MID REIT
¥231,800
- 10.8%
+ 12.7%
+ 10.3%
¥42.5 bn
¥160.0 bn
11
Office / Retail
8979 Starts Proceed
¥181,000
- 2.4%
+ 49.0%
+ 70.6%
¥26.2 bn
¥47.8 bn
88
Residential
¥13,300
+ 3.3%
+ 114.2%
+ 104.9%
¥17.9 bn
¥77.1 bn
78 Residential / Office, etc.
¥206,100
- 5.9%
+ 18.6%
+ 15.8%
¥15.5 bn
¥30.4 bn
8975 Ichigo REIT
8963 Invincible
3278 Kenedix Residential
Sources: Disclosure materials of REITs, Bloomberg
+ 42.1%
TOTAL
¥6,080.7 bn ¥10,049.7 bn
9
Office
91 Residential / Office, etc.
20
Residential
2,280 properties
Please visit the following TSE websites for the latest REIT price information, etc.
Listed REITs, REIT Price Information List (Including Forecast of Annualized Dividend Yield etc.)
Tokyo Stock Exchange REIT Index (real time)
[Disclaimer] This report is provided to inform readers about the J-REIT market and is not intended to solicit investments. Information in
this report is not necessarily up-to-date and ARES does not guarantee its correctness or completeness. Information in this report is
subject to change without prior notice.
murakami@ares.or.jp
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