Translation of Japanese Original
February 25, 2021
To All Concerned Parties
REIT Issuer:
Kenedix Retail REIT Corporation
Representative: Moyuru Watanabe, Executive Director
(Securities Code: 3453)
Asset Manager:
Kenedix Real Estate Fund Management, Inc. Representative: Masahiko Tajima, President & CEO Contact: Koichiro Nobata, Head of Planning Division,
Retail REIT Department
TEL: +81-3-5157-6013
Notice Concerning Disposition of Property (Hankyu Oasis Hirakatadeguchi)
Kenedix Retail REIT Corporation ("KRR") announced today that Kenedix Real Estate Fund Management, Inc. ("the Asset Manager"), the asset manager for KRR, has decided to dispose the following property as follows.
1. Outline of the disposition
(1) Type of asset:
(2) Property name:
(3) Disposition price (Note):
(4) Book value:
Trust beneficiary interest in real estate Hankyu Oasis Hirakatadeguchi 1,500 million yen 1,295 million yen
(Book value is as of September 30, 2020, rounded off to the nearest million yen.)
(5) Difference between disposition price and book value:
204 million yen
(Figure is referential amount, calculated as a difference between disposition price and book value, and is different from gain or loss on sale. It is rounded off to the nearest million yen.)
(6) Buyer:
(7) Date of contract:
Please refer to Item 4. Buyer's profile for details February 25, 2021
(8) Disposition date:
August 10, 2021
(9) Use of proceeds:
The proceeds from the disposition are to be allocated as cash on hand and used as a portion of funds for future acquisitions of specified assets and related expenses, redemption of investment corporation bonds or repayment of borrowings.
(10) Settlement method:
Received a deposit of 150 million yen on the date of contract Receive the remaining amount on the disposition date
(11) Method of buyer selection:
The buyer was selected from several potential buyers after verifying the prices and conditions of the disposition.
Note: Excluding acquisition costs, adjustment amount of property tax and city-planning tax, etc.
2. Reason for the disposition
KRR has announced that it will search for opportunities of asset reshuffle as a measure to enhance its unitholder value, focusing on DPU growth. The decision for the disposition is made with comprehensive considerations on factors such as enhancement of the portfolio, overall real estate market, the characteristics of individual asset, etc. As the lease contract of the property expiring in July 2021, KRR had been in discussions with the current tenant
for a new contract. However, since there was a large discrepancy with the current tenant regarding the terms of the new lease contract, KRR had been considering the possibility of tenant replacement and asset disposition. As a result, KRR reached an agreement with a potential buyer to sell the property at a price that exceeded the appraisal value of the property by more than 12% and the book value by more than 15%. As the asset value of the property is expected to decline if KRR continues to hold the property, KRR determined that disposing of the property would lead to an increase in unitholder value.
3. Details of the property
Property name | Hankyu Oasis Hirakatadeguchi | |
Property type (Note 1) | SM | |
Type of specified asset | Trust beneficiary interest in real estate | |
Trustee | Sumitomo Mitsui Trust Bank, Ltd. | |
Location | 1-17-20 Deguchi, Hirakata, Osaka | |
Land | Form of ownership | Proprietary ownership |
Land area | 4,978.38 m2 | |
Zoning | Industrial area | |
Building coverage ratio | 60% | |
Floor-area ratio | 200% | |
Building | Form of ownership | Proprietary ownership |
Gross floor area | 2,961.02 m2 | |
Date constructed | August 9, 2006 | |
Use | Retail store | |
Structure/No. of floors | S-structure / 2-story building | |
Acquisition price | 1,280 million yen | |
Appraisal value (as of) | 1,330 million yen (September 30, 2020) | |
Real estate appraiser | Daiwa Real Estate Appraisal Co., Ltd. | |
Lease summary Number of tenants Annual rent Tenant deposits Leased area Leasable area Occupancy rate | (as of September 30, 2020) | |
1 | ||
Not disclosed (Note 2) | ||
Not disclosed (Note 2) | ||
2,960.38 m2 | ||
2,960.38 m2 | ||
100.0% | ||
Remarks | None | |
Others | Notes:
|
4. Overview of the buyer
The name of the buyer and other information are undisclosed as KRR has not obtained the buyer's consent. There
is no special capital, personnel, or business relationship between KRR / the Asset Manager and the buyer, and the buyer is not deemed a related party under the Investment Trust Law and the Asset Manager's "Retail REIT Department's Internal Regulations on Related Party Transactions".
5. Details of brokerage
The broker is a domestic company, and the name of broker and other information are undisclosed as KRR has not obtained the broker's consent. The broker is not deemed a related party under either the Investment Trust Law or the "Retail REIT Department's Internal Regulations on Related Party Transactions" of the Asset Manager, and
there is no special capital, personnel, business relationship between KRR/the Asset Manager and the broker.
6. Transactions with related parties
The disposition of the property does not constitute a related-party transaction.
7. Disposition schedule
Disposition decision date/ contract date | February 25, 2021 |
Scheduled settlement date | August 10, 2021 (planned) |
Note:
The purchase and sale agreement with the buyer on the sale of the asset falls under the category of forward commitment made by investment corporations as stipulated in the "Comprehensive Guidelines for Supervision of Financial Instruments Business Operators, etc." ruled by the Financial Service Agency of Japan. In case the agreement is terminated, either of the parties responsible for the termination shall compensate for the damage resulted from the termination by paying a penalty corresponding to 20% of the sale price (excluding consumption taxes and local consumption taxes) to the other party. However, since KRR is the seller in this transaction and there is no concern such as financing in execution the sale, KRR believes that the risk of KRR paying the penalty and making an important impact on its financial condition is small.
8. Future outlook
Gains on sale of the property are assumed for the fiscal period ending September 30, 2021. There are no changes to the forecasts of fiscal periods ending March 31, 2021 and September 30, 2021 as the impact on the disposition is minimal.
9. Summary of real estate appraisal report
(The numbers are in yen unless otherwise noted)
Summary of real estate appraisal report
Appraisal value | 1,330,000,000 yen |
Appraiser | Daiwa Real Estate Appraisal Co., Ltd. |
Date of appraisal | September 30, 2020 |
Item
Content
Basis
Income capitalization approach value
Calculated by using the income value by DCF method as a 1,330,000,000 yen standard and verifying it from the income value by direct capitalization method
Value based on direct capitalization method
1,340,000,000 yen
Calculated by capitalizing standardized net income, which is considered to be stable over the medium term, with a cap rate
(1) | Gross operating revenue |
Effective gross operating revenue | |
Loss from vacancy, etc. | |
(2) | Operating expenses |
Maintenance expenses | 0 yen None on assumption that the expenses are borne by lessees |
Utility expenses | 0 yen None on assumption that the expenses are borne by lessees |
Repair expenses | 0 yen None on assumption that the expenses are borne by lessees |
PM fees | 3,600,000 yen Calculated based on the current PM contract amount |
Tenant recruit expenses, etc. | 0 yen None on assumption |
Taxes and dues | Undisclosed |
Insurance premium | Undisclosed |
3 |
Undisclosed
Undisclosed
Undisclosed
Other expenses
(3)
Net operating income (NOI= (1)-(2))
75,614,200 yen
(4)Profit from security deposits
435,120 yenCalculating investment income assuming investment yield is 1.0%
(5)Capital expenditure
Calculated by taking into account the annual average renewal 2,569,000 yen cost in the engineering report and the construction management fee
Net cash flow (NCF=(3)+(4)-(5))
73,480,320 yen
(7)Cap rate
Calculated by comprehensively considering the location, 5.5% building conditions, and contractual terms of the subject property
Value based on DCF method
1,320,000,000 yen
Discount rate
Calculated based on discount rates for similar real estate 5.3% transactions, comparison with yields on other financial
instruments, etc.
Terminal cap rate
Calculated by taking into account the marketability of the 5.7% subject property at the end of the holding period against the cap
rate
Value based on cost method
867,000,000 yen
Ratio of land
Ratio of building
78.2% 21.8%
Adjustments in estimated value and considerations
None taken into account in determining appraisal value
(Note) Figures used in the direct capitalization method include information that KRR has not obtained consent from the lessee for its
disclosure. Such information or figures that can make calculation of such information are not disclosed in (1) and (2) above.
KRR website address:https://www.krr-reit.com/en/
This notice is the English translation of the Japanese announcement on February 25, 2021. However, no assurance or warranties are given for the completeness or accuracy of this English translation.
Attached materials
Reference material: Property portfolio of KRR
Reference material: Property portfolio of KRR (after the disposition of Hankyu Oasis Hirakatadeguchi and Daikanyama Address Dixsept)
No. | Type (Note 1) | Property name | Location | (Anticipated) acquisition date | (Anticipated) acquisition price (million yen) (Note 2) | Appraisal value (million yen) (Note 3) | Share (%) (Note 4) |
T-2 | Urban Station- Front SC | MONA Shin-Urayasu | Urayasu, Chiba | February 10, 2015 | 8,063 | 10,000 | 3.6 |
T-3 | Urban Station- Front SC | Passaggio Nishiarai | Adachi-ku, Tokyo | February 10, 2015 | 5,850 | 6,620 | 2.6 |
T-4 | Urban Station- Front SC | Daikanyama Address Dixsept (Note 5) | Shibuya-ku, Tokyo | February 10, 2015 | |||
- | - | - | |||||
T-5 | NSC | Unicus Ina | Kitaadachi-gun, Saitama | February 10, 2015 (Note 6) | 4,470 | 5,240 | 2.0 |
T-6 | NSC | Yorktown Kita-Kaname | Hiratsuka, Kanagawa | February 10, 2015 | 4,000 | 4,350 | 1.8 |
T-7 | NSC | Unicus Yoshikawa | Yoshikawa, Saitama | February 10, 2015 | 3,600 | 3,860 | 1.6 |
T-8 | SS | Sports Club Renaissance Fujimidai | Nerima-ku, Tokyo | February 10, 2015 | 2,586 | 2,750 | 1.2 |
T-9 | NSC | Super Viva Home Iwatsuki (Land) | Saitama, Saitama | October 2, 2015 | 4,815 | 5,470 | 2.2 |
T-10 | SS | K's Denki Shonan-Fujisawa (Land) | Fujisawa, Kanagawa | October 2, 2015 | 3,169 | 3,470 | 1.4 |
T-11 | NSC | Unicus Kamisato (Land) | Kodama-gun, Saitama | October 2, 2015 | 3,000 | 3,050 | 1.4 |
T-12 | NSC | Unicus Konosu (Land) | Konosu, Saitama | October 2, 2015 | 1,700 | 1,780 | 0.8 |
T-13 | SM | Inageya Yokohama Minamihonjuku (Land) | Yokohama, Kanagawa | October 2, 2015 | 1,442 | 1,390 | 0.6 |
T-15 | NSC | Nakamachidai Tokyu Store | Yokohama, Kanagawa | April 21, 2016 | 3,360 | 3,750 | 1.5 |
T-16 | SS | Central Wellness Club Nagatsuta Minamidai | Yokohama, Kanagawa | April 20, 2016 | 1,724 | 1,780 | 0.8 |
T-17 | SM | Life Kameido | Koto-ku, Tokyo | April 21, 2016 | 1,450 | 1,490 | 0.7 |
T-18 | NSC | Totsuka-Fukaya Shopping Center (Land) | Yokohama, Kanagawa | April 19, 2017 | 4,170 | 4,320 | 1.9 |
T-19 | NSC | Yumemachi Narashinodai Mall | Funabashi, Chiba | April 19, 2017 | 3,416 | 3,520 | 1.5 |
T-20 | NSC | Kawamachi Yahagi Mall | Chiba, Chiba | May 18, 2017 | 3,097 | 3,240 | 1.4 |
T-21 | SS | Prime Square Jiyugaoka | Meguro-ku, Tokyo | April 19, 2017 | 2,820 | 2,820 | 1.3 |
T-22 | SS | Round1 Ichikawa-Onitaka | Ichikawa, Chiba | April 19, 2017 | 1,880 | 1,970 | 0.8 |
T-23 | SM | Ozeki Tokiwadai | Itabashi-ku, Tokyo | February 13, 2018 | 1,263 | 1,340 | 0.6 |
T-24 | SS | Konami Sports Club Shibuya | Shibuya-ku, Tokyo | April 27, 2018 | 3,400 | 3,390 | 1.5 |
T-25 | NSC | Apita Terrace Yokohama Tsunashima | Kohoku-ku, Yokohama, Kanagawa | November 1, 2019 | 5,899 | 6,170 (Note 7) | 2.7 |
No.
Type (Note 1)
Property name
Location
(Anticipated) acquisition date
(Anticipated) acquisition price
(million yen)
(Note 2)
Appraisal value (million yen)
(Note 3)
Share
(%) (Note 4)
T-26
NSC
Kalsa Hiratsuka
Hiratsuka, Kanagawa
November 1, 2019
5,980
6,020
2.7
T-27
NSC
Monenosato Mall
Yotsukaido, Chiba
October 24, 2019
2,410
2,530
1.1
T-28
NSC
KDX Chofu Building (Retail wing)
Chofu, Tokyo
October 24, 2019
2,300
2,480
1.0
T-29
NSC
Across Plaza Urayasu Higashino (Land)
Urayasu, Chiba
October 24, 2019
2,248
2,310
1.0
T-30
SM
Comfort Market Nishi-magome
Ota-ku, Tokyo
April 15, 2020
1,920
2,000
0.9
O-1
NSC
Blumer Maitamon
Kobe, Hyogo
February 10, 2015
8,389
9,610
3.8
O-2
SM
Life Takadono (Land)
Osaka, Osaka
February 10, 2015
2,685
3,140
1.2
O-3
NSC
DCM Kahma MEGA Don Quijote UNY Omihachiman
Omihachiman, Shiga
February 10, 2015
2,140
2,590
1.0
O-4
NSC
Blumer HAT Kobe
Kobe, Hyogo
April 16, 2015
11,000
11,000
5.0
O-5
Urban station-front SC
Carino Esaka
Suita, Osaka
October 2, 2015
6,555
7,190
3.0
O-6
Urban station-front SC
COMBOX Komyoike
Izumi, Osaka
October 2, 2015
6,450
6,490
2.9
O-7
SM
Hankyu Oasis Hirakatadeguchi
Hirakata, Osaka
October 2, 2015
-
-
-
O-9
SM
Life Nishi-Tengachaya
Osaka, Osaka
January 21, 2016
1,505
1,690
0.7
O-10
NSC
Million Town Tsukaguchi (Land)
Amagasaki, Hyogo
April 21, 2016
3,723
3,980
1.7
O-11
NSC
Habikigaoka Shopping Center
Habikino, Osaka
September 27, 2019
2,000
2,020
0.9
N-1
SS
Kahma Home Center Nakagawa Tomita (Land)
Nagoya, Aichi
February 10, 2015
2,311
2,690
1.0
N-2
NSC
Valor Ichinomiya-Nishi
Ichinomiya, Aichi
February 10, 2015
2,174
2,360
1.0
N-4
SS
Homecenter Kohnan Sunadabashi
Nagoya, Aichi
April 21, 2016
7,140
7,280
3.2
N-6
NSC
Resora Obu Shopping Terrace
Obu, Aichi
August 1, 2017
7,911
7,050
3.6
N-7
SM
Valor Nakashidami (Land)
Moriyama-ku, Nagoya, Aichi
November 1, 2019
2,551
2,560
1.1
F-1
SM
Sunny Noma
Fukuoka, Fukuoka
February 10, 2015
1,497
1,640
0.7
F-2
SS
Round1 Stadium Hakata-Hanmichibashi
Fukuoka, Fukuoka
April 19, 2017
5,020
5,760
2.3
F-3
NSC
Kurume-Nishi Shopping Center
Kurume, Fukuoka
April 19, 2017
1,515
1,840
0.7
R-1
NSC
Roseo Mito
Mito, Ibaraki
February 10, 2015
(Note 8)
10,046
12,000
4.5
No.
Type (Note 1)
Property name
Location
(Anticipated) acquisition date
(Anticipated) acquisition price
(million yen)
(Note 2)
Appraisal value (million yen)
(Note 3)
Share
(%) (Note 4)
R-2
SS
K's Denki Aomori Honten
Aomori, Aomori
February 10, 2015
1,469
1,520
0.7
R-3
SS
Super Sports Xebio Aomori-Chuo
Aomori, Aomori
February 10, 2015
898
912
0.4
R-4
NSC
Ashico Town Ashikaga
Ashikaga, Tochigi
October 2, 2015
4,180
4,660
1.9
R-5
NSC
Yorktown Shinden-Higashi
Sendai, Miyagi
October 2, 2015
3,252
2,610
1.5
R-6
SM
Kasumi Technopark Sakura
Tsukuba, Ibaraki
October 2, 2015
830
879
0.4
R-8
NSC
P-1 Plaza Tenno
Hamamatsu, Shizuoka
April 22, 2016
4,010
4,350
1.8
R-9
NSC
Seiyu Rakuichi Moriya (Land)
Moriya, Ibaraki
January 31, 2017
4,111
4,260
1.9
R-10
NSC
Sun Street Hamakita
Hamamatsu, Shizuoka
April 27, 2017
10,746
11,160
(Note 7)
4.8
R-11
SS
Costco Wholesale Sapporo Warehouse
Sapporo, Hokkaido
May 31, 2018
4,210
4,420
1.9
L-1
L
Zama Distribution Center
Zama, Kanagawa
April 5, 2019
1,400
1,690
0.6
L-2
L
Oppama Distribution Center
Yokosuka, Kanagawa
April 5, 2019
1,300
1,600
0.6
L-3
L
Musashi Ranzan Distribution Center
Hiki-gun, Saitama
March 26, 2019
3,879
4,090
(Note 7)
1.7
L-4
L
Yokohama Kamigo Distribution Center
Yokohama, Kanagawa
April 11, 2019 (Note 9)
909
970
0.4
L-5
L
Gyoda Distribution Center
Gyoda, Saitama
October 1, 2019
3,160
3,440
1.4
L-6
L
Shinjuku Nishiochiai Distribution Center
Shinjuku-ku, Tokyo
January 10, 2020
810
821
0.4
L-7
L
Chiba-Kita Distribution Center
Chiba, Chiba
December 25, 2020
1,250
1,340
0.6
L-8
L
Sapporo Shiroishi Distribution Center
Sapporo, Hokkaido
December 24, 2020
800
1,020
0.4
Total
221,859
237,742
100.0
(Note 1)
Properties are categorized into the following five types of retail properties for daily needs: NSC (Neighborhood Shopping Center), SM (Supermarket), CSC (Community Shopping Center), Urban Station-Front SC (Urban Station-Front Shopping Center) , SS (Specialty Store) and L (Logistics facility).
(Note 2)
"(Anticipated) acquisition price" indicates the purchase price of each trust beneficiary interest specified in purchase agreement in relation to the acquisition of each property (excluding acquisition costs, adjustment in property tax and city-planning tax, and consumption tax; and rounded down to the nearest one million yen). (As for the properties with building expansion which were additionally acquired, the price includes the amount described in the construction contract and construction design/supervision outsourcing contracts related to construction (expansion) of the building which is additionally acquired part (excluding expenses and taxes and rounded down to the nearest million yen).
(Note 3)
"Appraisal values" are the values as of the end of September 2020 for the properties held as of September 30, 2020, as of December 1, 2020 for Chiba-Kita Distribution Center and Sapporo Shiroishi Distribution Center.
(Note 4)
"Share" indicates the percentage of the (anticipated) acquisition price for each property in the total (anticipated) acquisition price, rounded down to the first decimal place.
(Note 5)
For details of the disposition of Daikanyama Address Dixsept, please refer to "Notice Concerning Disposition of Property (Daikanyama Address Dixsept)" dated November 17, 2020.
(Note 6) (Note 7)
A restaurant building additionally acquired on January 16, 2017.
Represents the amount corresponding to the trust beneficiary quasi-co-ownership.
(Note 8) (Note 9)A second-hand store building additionally acquired on November 26, 2015.
A restaurant building additionally acquired on September 29, 2020.
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Disclaimer
Kenedix Retail REIT Corporation published this content on 25 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 February 2021 06:31:00 UTC.