Japan Prime Realty Investment Corporation (8955) accomplished DPU growth for 14 consecutive fiscal periods in its 38th financial results driven by high occupancy and external growth.
Successive external growth will be key focus in order to make up for decelerating internal growth due to COVID-19.

Japan Prime Realty Investment Corporation (8955) accomplished DPU growth for 14 consecutive fiscal periods in its 38th financial results driven by high occupancy and external growth.
Successive external growth will be key focus in order to make up for decelerating internal growth due to COVID-19.

◎Financial Highlights
・Operating revenues marked 17.12 billion yen (+4.7％ period on period) and operating profit 8.53 billion yen (+6.5％)
・Distribution per unit (DPU) and NAV continued to grow
・DPU marked 7,750 yen (+155 yen PoP)
・DPU grew for 14 straight fiscal periods driven by strong occupancy and external growth in December 2020 period
・COVID-19 caused delay in leasing
・External growth will be focused in order to complement slowdown in internal growth due to future fall in occupancy
・In principle, capital gains will be retained in full amount to be utilized for stable DPU payout
＜Guidance＞
・June 2021 (39th fiscal period): Operating revenues of 17.25 billion yen and operating profit of 8.71 billion yen are guided
・DPU is guided to be 7,550 yen (-2.6% PoP)
・December 2021 (40th fiscal period): Operating revenues of 16.43 billion yen and operating profit of 7.84 billion yen are guided
・DPU is guided to be 7,550 yen (flat growth PoP)
▽COVID-19 implications
・Tenant relief upon national state of emergency will be limited. Delay in leasing and increase in downtown occur
＜Growth Strategy＞
1. Continuation of internal growth
・Internal growth is decelerating as the office leasing market changes
・Efforts will be made to sustain and increase rent level
2. External growth by leveraging low LTV
・Sponsor pipeline will be leveraged for asset acquisitions
・Asset reshuffle will be conducted strategically
3. Cost optimization
＜Strategy on sustainable DPU＞
・Retained earnings will be utilized in the event of temporary DPU decrease being greater than anticipated
＜Medium-term target＞
・Medium-term DPU target will remain at 7,800 yen
・Early leasing and external growth will lead to attaining the target at an earlier date

◎Operating status and growth strategy
▽Internal growth strategy
・Occupancy remained over 99% in December 2020 fiscal period
・Occupancy will be lowered slightly in June 2021 due to delay in leasing in June. However, occupancy rate will remain 98%
・Fundamental trend for rent growth continues even though monthly rents decreased in December 2020 as a result of rent reduction on large tenant
・Retail properties remain fully occupied
・Exposure to food and beverage tenants susceptible to COVID-19 is only limited to 3%
▽External growth strategy
・Otemachi Financial City was acquired as a result of asset reshuffle in December 2020 period
・Successive external growth will be pursued by capitalizing on sponsor pipeline
▽Financial strategy
・Robust financial foundation has been established by extension and levelling-out of maturity and conservative LTV control
▽Sustainability
・ESG activities are promoted strongly, such as devising materiality
・Environmental certifications were obtained proactively, e.g., 5 stars on GRESB Real Estate Assessment