August 18, 2022
For Immediate Release
Investment Corporation:
Daiwa House REIT Investment Corporation
2-4-8, Nagatacho, Chiyoda-ku, Tokyo
Toshiharu Asada, Executive Director
(TSE Code: 8984)
Asset Manager:
Daiwa House Asset Management Co., Ltd.
Koichi Tsuchida, President and CEO
Inquiries:
Koyu Asahina, General Manager,
Fund Management Department, Daiwa House REIT Division
TEL: +81-3-3595-1265
Notice Concerning Acquisition of Trust Beneficiary Interests in Domestic Real Estate
Daiwa House REIT Investment Corporation (“DHR”) hereby announces the decision made today by Daiwa House Asset Management Co., Ltd. (the “Asset Manager”), the asset manager to which DHR entrusts the management of its assets, for DHR to acquire the following assets (the “Anticipated Acquisitions”) as described below.
The decision to acquire the Anticipated Acquisitions has been approved by the board of directors of DHR based on the Act on Investment Trust and Investment Corporations (Act No. 198 of 1951, as amended, the “Investment Trust Act”) and the Asset Manager’s voluntary rules concerning conflict of interest.
1. Acquisition overview
Anticipated
Appraisal
NOI yield
Anticipated
acquisition
value
NOI
Property
Real estate in trust
Asset
after
Location
date of
price
(million
yield
number
(Property name)
class
depreciation
acquisition
(million yen)
yen)
(Note 3)
(Note 4)
(Note 1)
(Note 2)
LM-007
DPL Tsukuba Yatabe
Logistics
Tsukuba City,
7,800
8,250
4.8%
3.6%
Ibaraki
DPL Hiroshima
Hiroshima
LM-008
Logistics
City,
18,800
19,600
4.8%
3.7%
Kanon
Hiroshima
September
5, 2022
LM-009
DPL Okinawa
Logistics
Tomigusuku
8,200
8,220
5.8%
3.1%
Tomigusuku I
City, Okinawa
LB-067
D Project Kadoma I
Logistics
Kadoma City,
3,150
3,420
6.3%
3.5%
Osaka
Total / Average
37,950
39,490
5.1%
3.5%
(Note 1) Excluding such amounts as expenses related to acquisition, amounts equivalent to reimbursement of taxes and dues, etc., and amount equivalent to consumption taxes.
(Note 2) Appraisal value as of June 30, 2022.
(Note 3) “NOI yield” is represented by a figure calculated by dividing the stabilized net operating income, calculated by deducting operating expenses from operating income based on a direct capitalization method, as stated in the appraisal report (as of June 30, 2022) (the “Net Operating Income” in Note 4 below), by an anticipated acquisition price. Average is calculated by weighted average of NOI yield based on anticipated acquisition price.
Disclaimer: This announcement is prepared for the public disclosure of acquisition of trust beneficiary interests in domestic real estate by DHR and has not been prepared for the purpose of soliciting investment within or outside of Japan. This announcement does not constitute any offer of securities in the United States. The securities referred to have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be offered in the United States.
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(Note 4) “NOI yield after depreciation” is calculated by dividing the figure, calculated by deducting depreciation estimated by the Asset Manager from the Net Operating Income in the appraisal report (as of June 30, 2022), by an anticipated acquisition price. Average is calculated by weighted average of NOI yield after depreciation based on anticipated acquisition price.
(2)
Execution date of the purchase agreements
： Please refer to below “7. Acquisition schedule”
(3)
Planned date of acquisition
： Please refer to above table (1) “Anticipated date of acquisition”
(4)
Seller
： Please refer to below “4. Seller profile”
(5)
Acquisition funds
： Proceeds from issuance of new investment units (a public
offering), debt financing and cash reserves (Note 1)
(6)
Method of settlement
： Payment of entire amount upon transfer
(7)
Brokerage
： None
(Note 1) Please refer to the press releases “Notice Concerning Issuance of New Investment Units and Secondary Offering of Investment Units” and “Notice Concerning Debt Financing (Green Loan and Sustainability-Linked Syndicated Loan) and Debt Refinancing” dated today.
2. Rationale for acquisition
Based on the targets and policies prescribed in DHR’s Articles of Incorporation, the Asset Manager decided for DHR to acquire the Anticipated Acquisitions having deemed that the acquisition would expand the asset size, further increase the stability of cash flow through increased portfolio diversification and secure stable revenues in the long term. The Anticipated Acquisitions are recently built logistics facilities, proven by the average age of 1.1 years, all of which have obtained environmental certifications (including three rare ZEB (Net Zero Energy Building)-certified properties). All of the Anticipated Acquisitions will be through the pipeline of Daiwa House Group.
For the details of the Anticipated Acquisitions, please see “3. Details of the Anticipated Acquisitions”.
3. Details of the Anticipated Acquisitions
The following tables provide an overview of the trust beneficiary interests in real estate that are the Anticipated Acquisitions. Furthermore, unless otherwise stated, descriptions in each column in the “Property number”, “Asset class”, “Type”, “Anticipated date of acquisition”, “Anticipated acquisition price”, “Overview of specified asset”, “Overview of building condition evaluation”, “Soil contamination inspector”, “Designer, structural designer, contractor and inspection agency”, “Overview of leasing”, “Special items” and “Property characteristics” for each property indicated below are prepared in accordance with the following definitions, and are based on the information available as of May 31, 2022.
・“Property number” is numbered to each property owned under each asset class. “L” means logistics properties. “LB” means built-to-suit type logistics properties, and “LM” means multi-tenant type logistics properties.
・“Asset class” shows the asset class categories under our portfolio composition based on the DHR’s investment policy. ・“Type” shows the type of respective uses as follows for respective Anticipated Acquisitions in accordance with types of
investment destination based on the DHR’s investment policy.
＜Logistics properties＞
Type
BTS (Build-to-suit) type
Multi-tenant type
Logistics properties customized to tenant
Logistics properties located on sites suitable to the
Description
needs, while maintaining general versatility to
logistics needs of various businesses with optimal
accommodate successor tenants in the future
scale, grade and facilities for their respective site
・“Anticipated date of acquisition” shows the planned date of acquisition of the respective Anticipated Acquisitions indicated in the purchase agreements regarding the relevant acquisition, but such a date may be changed by mutual consent between DHR and the seller.
・“Anticipated acquisition price” shows the transaction price (excluding such amounts as expenses related to acquisition, amount equivalent to reimbursement of taxes and dues, etc., and amount equivalent to consumption taxes) of the respective Anticipated Acquisitions indicated in the purchase agreements regarding the relevant acquisition.
・“Trustee” is the trustee or the party that is scheduled to become the trustee of the respective Anticipated Acquisitions.
・“Trust maturity date” shows the trust maturity date for respective Anticipated Acquisitions defined in the trust agreement which is scheduled to have teeth when DHR acquires.
Disclaimer: This announcement is prepared for the public disclosure of acquisition of trust beneficiary interests in domestic real estate by DHR and has not been prepared for the purpose of soliciting investment within or outside of Japan. This announcement does not constitute any offer of securities in the United States. The securities referred to have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be offered in the United States.
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・“Lot number” for location is the lot number as indicated in the register (only one location is indicated for properties that have several locations), and “Residence indication” for location is the residence indication of each property in trust as indicated in the register (for each property in trust without residence indication, the location of the building is as indicated in the register (only one location is indicated for properties that have several locations)).
・“Type of ownership” for the land and building indicates, for each of the Anticipated Acquisitions, the kind of rights held by the trustee or to be held by a party that is scheduled to become a trustee subject to a trust agreement which is scheduled to have teeth when DHR acquires.
・“Land area” is based on the descriptions in the registry, and may not match the present status.
・“Area classification” for the land indicates the type of zoning district depicted in Article 8, Paragraph 1, Item 1 of the City Planning Act (Act No. 100 of 1968, as amended) or the type of urban district classification depicted in Article 7 of the City Planning Act.
・“Building coverage ratio” for the land is the ratio of the building area of the building to the site area as stipulated in Article 53 of the Building Standards Act (Act No.201 of 1950, as amended) and is the maximum figure of the building coverage ratio determined by city planning in accordance with the zoning, etc. (designated building coverage ratio). Designated building coverage ratios may be relaxed / increased, or decreased, since the building is a fireproof building in a fire prevention district, or for other reasons. Therefore it may differ from the actual building coverage ratio to be applied.
・“Floor area ratio (FAR)” for the land is the ratio of the total floor area of the building to the site area as stipulated in Article 52 of the Building Standards Act and is maximum figure of the floor area ratio determined by city planning in accordance with the zoning, etc. (designated floor area ratio). Designated floor area ratios may be relaxed / increased, or decreased, since the width of the road adjacent to the site, or for other reasons. Therefore it may differ from actual floor area ratio to be applied.
・“Gross floor area” for the building is the sum total of the floor area recorded in the registry, excluding the areas of annex buildings, and may not match the present status.
・“Use” for the building shows the primary category described in the registry, and may not match the present status.
・“Structure” and “Number of floors” for the building are based on the descriptions in the registry, and excludes annex buildings.
・“Date of construction” for the building is the date of construction as written in the property registry of the main building. ・“Collateral” indicates the outline of the collateral for the respective Anticipated Acquisitions, if there is collateral scheduled
to be borne by DHR after the acquisition.
・“Overview of building condition evaluation” is based on the descriptions in the engineering report prepared for the respective Anticipated Acquisitions.
・“Evaluation date” shows the date when the building condition evaluation report surveyed and prepared by the evaluation companies was prepared.
・“PML” represents the probable maximum loss from an earthquake as being the amount of probable loss of damage that may result from an earthquake having 0.21% annual exceedance probability (475-year return period) expressed as a percentage (%) of the replacement cost. (Note)
(Note) Replacement cost: Expenses that will be incurred if the existing building is to be newly constructed at the time investigation.
・“Soil contamination inspector” is based on the descriptions in the engineering report prepared for the respective Anticipated Acquisitions.
・“Designer, structural designer, contractor and inspection agency” is based on the descriptions in the applications for building verification and applications for approval to change etc. for the Anticipated Acquisitions, and is described as the names of the companies at the time.
・“Overview of leasing” shows the content of respective lease agreements or lease reservation agreements as of August 18, 2022 for respective property in trust regarding the respective Anticipated Acquisitions. The items “Contract form”, “Contract period”, “Rent revision”, “Contract renewal” and “Early cancellation” are filled with the information about key tenants (of which leased area exceeds 50% of the leasable area of the whole building) for the portfolio assets. In the event that a pass-through type master lease agreement has been executed or is scheduled to be executed for each property in trust, the terms of a sublease agreement executed between a master lease company and a key end tenant. “Leased area (ratio to total leasable area)” is indicated only when there is more than one tenant (end tenant)”.
・“Leasable area” is the leasable area of the building (of the land, for land with leasehold interest properties) for each property in trust, and indicates the area which DHR recognizes to be leasable based on the lease agreements or lease reservation agreements or building drawings or other documents for the respective property in trust as of August 18, 2022.
・“Leased area” shows the leased area indicated in respective lease agreements or lease reservation agreements as of August 18, 2022 for respective property in trust regarding the respective Anticipated Acquisitions. However, if there is a master
Disclaimer: This announcement is prepared for the public disclosure of acquisition of trust beneficiary interests in domestic real estate by DHR and has not been prepared for the purpose of soliciting investment within or outside of Japan. This announcement does not constitute any offer of securities in the United States. The securities referred to have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be offered in the United States.
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lease agreement or a planned master lease agreement concluded with the sublessee, it shows the leased area of end-tenants indicated in the sublease agreements concluded between the sublessee and end-tenants as of August 18, 2022 for respective property in trust regarding the respective Anticipated Acquisitions. Furthermore, as the respective lease agreements or lease reservation agreements may indicate leased area that includes portions not included in the gross floor area, the leased area may exceed the gross floor area. In particular, if eaves are included in the leased area for logistics facilities, the leased area may significantly surpass the gross floor area.
・“Occupancy rate” is the ratio of leased floor area to leasable floor area.
・“Number of tenants” indicates the number of tenants for each property of the Anticipated Acquisitions based on the lease agreements or lease reservation agreements, etc. as of August 18, 2022. However, “Number of tenants” enters the number of tenants as 1 if there is a master lease agreement or a planned master lease agreement concluded with the sublessee.
・“Annual rent” means the amount calculated by multiplying the monthly rent (excluding consumption taxes) of the building as indicated in respective lease agreement or lease reservation agreement in relation to each property in trust as of August 18, 2022 by 12 on an annual basis (as to properties in trust for which multiple lease agreements or lease reservation agreements are entered into, the total amount indicated in such lease agreements or lease reservation agreements). If a pass-through type master lease agreement is or is scheduled to be entered into, the annual rent is the amount calculated by multiplying the monthly rent (excluding consumption taxes) as indicated in each sublease agreement in relation to each property in trust as of August 18, 2022 by 12 on an annual basis (as to properties in trust for which multiple sublease agreements are entered into, the total amount indicated in such sublease agreements).
・“Tenant leasehold and security deposits” is calculated based on the leasehold and security deposits indicated in respective lease agreement or lease reservation agreement in relation to each property in trust as of August 18, 2022 (as to properties in trust for which multiple lease agreements or lease reservation agreements are entered into, the total amount indicated in such lease agreements or lease reservation agreements). If a pass-through type master lease agreement is or is scheduled to be entered into, leasehold and security deposits are those indicated in the sublease agreements of end-tenants as of August 18, 2022 (as to properties in trust for which multiple sublease agreements are entered into, the total amount indicated in such sublease agreements). Meanwhile, leasehold and security deposits that do not need to be returned to the tenant pursuant to the lease agreements or lease reservation agreements are excluded from this calculation.
・“Lease term” indicates what is specified in the respective lease agreements or lease reservation agreements as of August 18, 2022 for each property in trust (or, the sublease agreements concluded between the sublessee and end-tenants as of August 18, 2022, for each property in trust, in the event that a pass-through type master lease agreement has been executed or is to be executed with a master lease company). “Average lease term” indicates a weighted average of the lease term under the respective lease agreements or lease reservation agreements with the annual rent specified in the relevant agreements, respectively.
・“Remaining lease term” indicates the period from the respective anticipated date of acquisition to the expiration of the lease term specified in the respective lease agreements or lease reservation agreements as of August 18, 2022 for each property in trust (or the sublease agreements concluded between the sublessee and end-tenants as of August 18, 2022 for each property in trust, in the event that a pass-through type master lease agreement has been executed or is to be executed with a master lease company). “Average remaining lease term” indicates a weighted average of the remaining lease term under the respective lease agreements or lease reservation agreements with the annual rent specified in the relevant agreements, respectively.
・“Master lease company” is the lessee that has a blanket lease agreement concluded or scheduled to be concluded with the trustee for the purpose of re-letting to third parties.
・“Master lease type” shows either a “pass-through type” for those master lease agreements that DHR receives rents as-is, and “sublease type” for those master lease agreements that DHR receives a fixed amount of rent irrespective of the actual rent paid by the end-tenants. For a “pass-through type” DHR is entitled to receive rents when it is actually leased to an end-tenant.
・“Property management company” indicates the property management company consigned or scheduled to be consigned with property management services for respective property in trust.
・“Contract period” shows the contract period indicated in respective lease agreements or lease reservation agreements as of August 18, 2022 for respective property in trust.
・“Special items” presents matters recognized to be of importance in terms of the rights, use, etc. of respective Anticipated Acquisitions, as well as matters recognized to be of importance in consideration of the degree of impact on the appraised value, profitability and appropriation of assets, including the following matters:
Disclaimer: This announcement is prepared for the public disclosure of acquisition of trust beneficiary interests in domestic real estate by DHR and has not been prepared for the purpose of soliciting investment within or outside of Japan. This announcement does not constitute any offer of securities in the United States. The securities referred to have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be offered in the United States.
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without arrangements and cases where there are issues with boundary confirmation, etc.; and
Disclaimer: This announcement is prepared for the public disclosure of acquisition of trust beneficiary interests in domestic real estate by DHR and has not been prepared for the purpose of soliciting investment within or outside of Japan. This announcement does not constitute any offer of securities in the United States. The securities referred to have not been and will not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”). The securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act. The securities referred to above will not be offered in the United States.
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Daiwa House REIT Investment Corporation published this content on 18 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 August 2022 07:23:08 UTC.
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