Japan Prime Realty (8955)’s adjusted EPU resulted in 7,480 yen for the 46th financial period, impacted by rent decrease due to tenant departures from MS Shibaura Building. Record high DPU of 7,935 yen was marked driven by return of gains from asset sales.

Japan Prime Realty (8955)’s adjusted EPU resulted in 7,480 yen for the 46th financial period, impacted by rent decrease due to tenant departures from MS Shibaura Building. Record high DPU of 7,935 yen was marked driven by return of gains from asset sales.

◎Financial Highlights
・Operating revenues of 19.58 billion yen (+11.0% period-on-period) and operating profit of 9.71 billion yen (+16.3% PoP) were recorded.
・Record high DPU of 7,935 yen was marked driven by return of gains from asset sales.
・Adjusted EPU resulted in 7,480 yen, impacted by rent decrease due to tenant departures from MS Shibaura Building.

＜Guidance＞
・Rental income from the current portfolio is expected to improve substantially from June 2025 FP driven by rent increase and occupancy improvement.
・Immediate 7,600 yen target for adjusted EPU is to be achieved in December 2025 FP.
・Guidance for June 2025 FP: 20.76 billion yen (operating revenues) and 11.27 billion yen (operating profit)
・DPU is forecast to be 8,030 yen contributed by gains from sales of Ueno East Building.
・Adjusted EPU is guided to be 7,560 yen as a result of fully-leased MS Shibaura, upward rent revisions in progress, asset reshuffles and investment unit buyback.
・Guidance for December 2025 FP: 18.32 billion yen (operating revenues) and 8.62 billion yen (operating profit)
・DPU is forecast to be 8,100 (approximation before split) with the use of retained earnings.
・Accelerated positive rent revisions and full-term contribution by Nakano additional acquisition will drive adjusted EPU to be 7,610 yen surpassing the immediate target of 7,600 yen.

◎Review of operation
▽Internal growth
・Robust portfolio is constructed centering on prime office properties in Tokyo, with well-diversified mix in area, grade, asset class and rent level.
・Occupancy as of June 2025 FP is expected to rise to 98.8% as a result of fully-leased MS Shibaura Building.

＜Rents＞
・Steady progress in positive rent revisions is made driven by JPR’s solid portfolio, the investment management company’s excellent capabilities and collaboration with the sponsor.
・On the back of rise in market rents, tenants that were below target rents have turned to bear positive rent gap after five financial periods.
Negotiations with those underrented tenants are conducted in pursuit of rent increase.

＜Retail properties＞
・Occupancy for June 2025 FP is expected to reach 100%. A broad range of initiatives are implemented to achieve rent increase.
▽External growth
・JPR’s assets under management have grown at an accelerated pace since 2020 underpinned by its sponsor Tokyo Tatemono’s medium term business plan.
・As Tokyo Tatemono has announced its new MTBP, JPR will continue to grow its AUM capitalizing on the pipeline.

▽Financial strategy
・Long and fixed rate financing will remain key to focus on stability.
・Use of debts with medium-term duration as well as long-dated floating interest rates will ensure stability and cost control.
・Lenders consisting of 45 financial institutions and investment corporation bonds diversify debt financing. Debts are financed on a bilateral basis with all the lenders.
・Sustainability finance is utilized actively, accounting for 33% of the interesting-bearing debts.

▽Sustainability
・Initiatives have been promoted for a long period of time.
・Various measures are devised and initiated for broad stakeholders.
・Efforts are made to improve third party assessments and to sign/endorse initiatives

＜Environment＞
・Eco Action 21 (an environmental management system) certification and registration
・Offsite corporate PPA scheme was introduced for the first time to procure power.
・GHG emission reduction is on track for the 2030 goal. Intensity target for energy consumption has been set.
・Construction works for energy saving are promoted. Reduction in energy, water use, waste disposals is initiated in cooperation with property managers (PMs), building manager (BMs) and tenants.
＜Social and Governance＞
・Initiatives for PMs and BMs are promoted in order to enhance quality of management levels.
・Measures are taken to provide employees of TRIM with workplace that embraces diversity.