Entering New Business Areas and Using M&A and Business Partnerships

「Under this policy, during the interim period we strengthened acquisitions, commercialization and sales in the entire-building income-producing property business; accelerated growth in the office-unit business; conducted explanatory activities and sales for existing customers and referral partners in the fractional real estate business based on current investment needs; actively acquired sites and commenced operations in the grid-scale battery storage business; and built platforms for new businesses, including non-asset businesses.」

「We are currently developing the business platforms for the real estate crowdfunding, private-fund and hotel-operation businesses, while pursuing investments such as project acquisitions in the grid-scale battery storage business. We aim to monetize these new businesses in stages according to their respective phases, primarily from 2027 onward.」

「This was mainly attributable to expenditure of ¥523 million for the acquisition of tangible fixed assets, including grid-scale battery storage facilities under construction.」

「This was mainly attributable to expenditure of ¥212 million for the acquisition of tangible fixed assets related to housing development and other activities in Hawaii, and ¥112 million for the acquisition of investment securities related to investments in private funds for logistics facilities and other activities.」

「During the first nine months of the current consolidated fiscal year, we recorded gains on sales of investment securities of ¥25 million and gains on sales of investment stock acquisition rights of ¥38 million as extraordinary income.」

「In investment activities during the second quarter, we continued to pursue the corporate venture capital business and the finance-arrangement business.」

「The master-lease and sublease business for medical malls is expected to lift profit from the recurring fee-based business that our group is strengthening, and we determined that it could generate sufficient future cash flow relative to the amount invested.」

「Through the corporate venture capital business, one of the means available to us, we have now launched a new finance-arrangement business (announced on 26 August 2022). We will continue to pursue new value creation through DX, M&A and other initiatives.」

「The principal factors were income of ¥156 million from the recovery of loans in ADW Lending LLC’s U.S. residential debt investment business, while purchases of investment securities totaled ¥122 million, mainly due to CVC investments and an additional investment in JMR Asset Management Co., Ltd., an investment management company established to form a REIT and an unconsolidated subsidiary.」

「The announcement of an investment in a digital-platform company as the first CVC transaction under this plan accelerated the identification of diverse potential investments.」

「In Japan, we began raising funds through crowdfunding in January, while overseas we began a joint development business with a local operator in Los Angeles and sold U.S. real estate residential debt through crowdfunding, among other new initiatives.」

「We also laid groundwork for future business development by testing new product concepts for income-producing properties, such as starting coworking-space services at a property in Shimokitazawa; newly establishing ADW Hawaii LLC to fully pursue business in Hawaii, U.S.; establishing Jupiter Funding Co., Ltd. to test various financing methods; and deciding to enter the corporate venture capital business to create synergistic value.」

「To develop an additional source of revenue outside the real estate business, entering and pursuing new business areas is essential. Our transition to a holding company structure on 1 April 2020 was intended to establish the platform needed to facilitate M&A, business alliances and capital alliances to realize these new businesses, and we will focus on initiatives that leverage this platform.」