Financial Strategy

Controlling Risks by Lengthening Maturity of Debts and Borrowing Funds at Fixed Interest Rates

JPR makes it a basic policy to lengthen maturity of debts and diversify the repayment dates, borrow funds at fixed interest rates and conduct negotiated deals with lenders, and diversify fund procurement sources and methods by utilizing investment corporation bonds, among other actions. More recently, JPR has further extended the duration of long-term loans and investment corporation bonds, establishing a strong financial base that focuses on financial stability.

Conservative financial operations
  • Conduct operations by controlling LTV at 50% or lower as a target
  • Establish a commitment line (24 billion yen) to secure fund procurement upon unforeseeable events
Lengthen maturity of debts and borrow funds at fixed interest rates
  • High ratio of long-term debts at fixed interest rates, pursuant to the basic policy of lengthening maturity of debts and borrowing funds at fixed interest rates

  • As a rule, allocate short-term debt only for flexible use of funds such as property acquisitions
Diversify risks
  • Reduce refinance risks by diversifying and flattening repayment dates
  • Appropriately control the repayment amount for each fiscal period to stand within the scope of the commitment line and cash on hand
Diversify means of fund procurement
  • Lender formation focusing on the balance of the source without weighing on certain lenders

  • Utilize investment corporation bonds in a proactive and flexible manner

Through the solid financial operations and other endeavors, JPR has maintained high (AA rank) credit ratings.

R&I (Rating and Investment Information, Inc.) AA−
S&P (Standard & Poor's Ratings Japan K.K.) Long-term: A Short-term: A-1

Click here for Stability of Cash Distributions

COLUMN

Purchase of J-REIT Units by the Bank of Japan

The Bank of Japan (BOJ) introduced the “Quantitative and Qualitative Monetary Easing” in order to achieve its price stability goal as early as possible. With regard to J-REITs, the BOJ has decided to purchase J-REIT units at a determined pace annually from the viewpoint of adding premiums to the asset value. It is expected that, thanks to the purchases by the BOJ, the risk of price declines in the J-REIT market will be further reduced. Furthermore, AA and higher-class ratings are required as a selection standard for the J-REIT units to be invested in by the BOJ. JPR is among the targets of the purchase program.