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The ORIX Group is an integrated financial services group that provides corporate and individual customers with innovative value-added financial products and services. The ORIX Group currently has operations in 26 countries and regions all over the world (including Japan) and engages in diversified businesses centering on the financial sector, such as financial service for corporate customers, such as leases, loans and others. automobile business, rental business, real estate-related finance business, real estate business, life insurance business, and investment banking services. The Group’s strategy with the real estate business is to achieve high profit growth. The ORIX Group centering on ORIX Real Estate Corporation is working to expand business in wide areas such as the development, sale and lease of office buildings, the sale of condominiums, the operation and management of golf courses, hotels and training institutes, general building management and other related services
Outline of the real estate business of the ORIX Group
● is part of the businesses conducted by the ORIX Group.
| Development | Investment in existing properties | Leasing | Operations, management | |
|---|---|---|---|---|
| Office buildings | ● | ● | ● | ● |
| Logistics facilities | ● | ● | ● | ● |
| Retail properties | ● | ● | ● | ● |
| Residential properties | ● | ● | ● | ● |
| Hotels | ● | ● | ● | |
| Nursing care facilities | ● | ● | ● | |
| Training facilities | ● | ● | ● | |
| Golf courses | ● | ● | ● |
Although occupancy rates are up mainly in the Tokyo area and rents are recovering from low levels, competition for the acquisition of properties is intensifying in the current office building market. In this environment, OJR is utilizing its relationships and working together with the ORIX Group companies (ORIX Synergy)—starting with ORIX Real Estate Corporation, the core company in the real estate business in our group so that OJR can steadily acquire properties and grow in scale. As a result, what was a total acquisition value of ¥99.6 billion (39 properties) at the time of our listing on the Tokyo Stock Exchange has become as of the end of this period a total of ¥235.6 billion (44 properties). Compared to the size at our listing, our assets have increased 240%.
Also, although we will continue to place our investment focus on the “Greater Tokyo” and “Office,” areas where we see prospects for medium- and long-term growth, we plan to diversify risk through acquisitions such as distribution facilities based on our own investment style, the “OJR WAY,” and acquisitions of office buildings in ordinance-designated cities such as Nagoya, Osaka and Sendai. In this way, we are building a portfolio structure with high stability and growth. Going forward, we will make use of ORIX Synergy and avoid the intense competition in property acquisitions by careful selection of highly competitive properties. OJR will focus on external growth and continue to work towards our medium-to-long term goal of ¥300 billion in assets.
Portfolio Growth Trend
Analysis of acquired properties after listed on stock market
Making use of ORIX Synergy, we have been acquiring a number of office buildings located in greater Tokyo, which have prospects for medium-to-long-term growth, and highly competitive new properties less than two years old.
Improvements in the quality of the portfolio:
Portfolio quality has significantly improved with acquisition centered to highly competitive new properties.
| 1. | Weighted average based on the acquisition prices of each property is shown for average building age and average property size. |
| 2. | Average property size is calculated based on the total floor space of the entire building regardless of the share held by OJR. |
