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Japan Real Estate Insights by estie
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Nippon REIT Investment Corp Divests Office and Residential Assets for JPY 6.62 Billion, Launching Portfolio Rebalancing Strategy

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Nippon REIT Investment Corp Divests Office and Residential Assets for JPY 6.62 Billion, Launching Portfolio Rebalancing Strategy

Nippon REIT Investment Corp Divests Office and Residential Assets for JPY 6.62 Billion, Launching Portfolio Rebalancing Strategy

On June 25, 2025, Nippon REIT Investment Corp, managed by SBI REIT Advisors, announced it had signed agreements to sell one office building and five residential properties for a combined total of JPY 6.62 billion. The largest asset in the deal, FORECAST Shinagawa, is a mid-size urban office building with a gross floor area of approximately 1,029 tsubo (approx. 34,000 sq. ft.) and is located a 10-minute walk from JR and Keikyu Shinagawa Station. Despite its 1989 completion date, the building has maintained full occupancy.

The five residential buildings, constructed between 2002 and 2008, are mid-sized reinforced concrete structures located across Tokyo, Fukuoka, and Osaka. Each maintains an occupancy rate above 90%.

According to the asset manager, the REIT is divesting assets with high unrealized gains to prepare for anticipated capital expenditures and to reallocate funds into newer properties. The transaction will generate a gain of JPY 5.332 billion above book value, which is expected to contribute to future dividend distributions starting from the 28th fiscal period. Buyers include Cosmos Initia Co., Ltd., a domestic operating company, and a special-purpose vehicle.

By disposing of assets yielding in the low 4% range—below the REIT’s portfolio average—the company aims to improve its risk-adjusted returns. Since March 2025, the REIT has acquired four properties including Arbus Ibaraki and Urbanex Ginza-Higashi II, totaling JPY 7.055 billion, accelerating its asset recycling strategy.

As of May 27, 2025, Japan REIT's portfolio consisted of 110 properties with a total acquisition price of JPY 259.3 billion and an occupancy rate of 97.8%. In its financial briefing materials, the company reaffirmed its goal of maintaining DPU above JPY 2,250 while also targeting the same level of EPU within the next 3 to 5 years—framing this latest asset swap as a step toward that target.

Key Facts

  • Property Name: FORECAST Shinagawa

  • Buyer: Domestic operating company

  • Seller: Nippon REIT Investment Corp

  • Transaction Price: JPY 2.7 billion

  • Location: 1-20-9 Kitashinagawa, Shinagawa-ku, Tokyo

  • Nearest Stations: 6-minute walk from Keikyu Main Line “Kitashinagawa” Station / 10-minute walk from JR Yamanote Line “Shinagawa” Station

  • Completion: February 1989

  • Number of Floors: 8F

  • Gross Floor Area: Approx. 1,029 tsubo (approx. 34,000 sq. ft.)

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