Basic Policy

Japan Rental Housing Investments, Inc. (“the Investment Corporation”) primarily invests in specified assets such as real estate that are primarily used for residential purposes (rental apartments) which are located nationwide (residential REIT). The Investment Corporation believes that it is easier to diversify investment areas for rental apartments in comparison to offices and retail facilities, and that such types of assets are relatively stable regardless of the upturns and downturns of rent revenue. By investing in rental residences, the Investment Corporation will strive to stabilize portfolio earnings, steadily increase its assets under management and stabilize the earnings for each asset under management over the medium to long-term. Through such activities, the Investment Corporation will strive to realize continued enhancement of unitholder value.

The Investment Corporation recognizes that for rental apartments, the use of the property significantly differs depending on the family structure, income and age of the user. Furthermore, it recognizes that the trends in demand varies according to each user type. In view of these observations, we will consider factors such as changes in family structure, changes in each user type’s views towards residences, generation gaps, and characteristics of each local area in order to identify the diversifying needs of users. Based on this awareness, we will make investment decisions. As a rule, the Investment Corporation invests in Japanese real estate that are deemed to produce stable earnings from the three rental apartment categories which it has classified as shown below in view of the users’ characteristics and to combine the properties based on the following investment ratios. In other words, the Investment Corporation will incorporate many small-scale Studio type properties since the market for such properties is expected to steadily expand over the long-term. With regards to Family type properties for which stable demand is projected, it will incorporate properties over a certain scale and for which stable management is expected. In addition to these two rental apartment categories, it will select Premium type properties that are centrally located in major metropolitan areas with relatively high rent levels and whose earnings are expected to grow along with the economy. We thus will form a portfolio under this combination. Through this type of investment, the Investment Corporation will be able to bring out the best characteristics of residential assets based upon diversification of tenant types, and will be able to properly control fluctuation risks in cash flow produced by the portfolio.