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Financial Strategy

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  2. Features of SHR
  3. Financial Strategy

Strong financial foundation based on sound
and stable financial operations

Equity Finance

For the purpose of acquiring assets, repaying debt and others, SHR aims to steadily grow its portfolio assets from a medium to long term perspective, accurately grasp the financial environment and flexibly issue new investment units while paying attention to the dilution of investment units.

Click here for the status of issuance of new investment units

Debt Finance

For the purpose of acquiring assets, repaying debt and others, SHR may borrow funds or issue investment corporation bonds.

Click here for the status of interest-bearing liabilities.

  • Maintaining conservative LTV

    Although the upper limit for LTV is set at 60%, SHR plans to conservatively manage its portfolio by maintaining an upper limit of about 50% on a total asset basis with an eye on securing cash reserves for the near future.

  • Interest rate fixation, loan term extension and diversification of repayment dates

    SHR aims for the appropriate management of its portfolio by extending loan terms while working to achieve optimum balance between fixed and floating interest rates. Furthermore, it will seek to reduce the risk in refinancing activities by such means as diversifying repayment dates.

  • Strong lender formation and diversification of fund procurement methods

    SHR aims to conduct strong and stable transactions, mainly with the mega banks and other prominent financial institutions in Japan. It will also seek to diversify debt financing methods by comprehensively taking into account the market environment, its own financial standing and other aspects.

Cash Management

SHR fully utilizes the property management capability of the Sekisui House Group, which commands renowned expertise and an impressive track record in the management and utilization of its portfolio assets. By doing so, it intends to undertake optimum cash management to improve capital efficiency while taking appropriate measures with an eye on maintaining and enhancing the competitiveness of its portfolio assets.

Specifically, SHR seeks to increase medium to long term investor value through the measures listed below:

  • Investment in new properties
  • Appropriate maintenance, management and repair to enhance the competitiveness of properties.
  • Reduction of debt cost through the repayment of interest-bearing liabilities.
  • Implementation of distributions in excess of earnings
  • Acquisition of self-investment units.

SHR also has the following basic policy for cash management

  • It holds cash and deposits that is considered appropriate at all times to respond to expected capital demand.
  • It manages cash reserves by taking safety and liquidity into account and fully factoring market conditions and financing status.
  • It can utilize deposits and guarantees entrusted by tenants as funds.

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