MIRAI Corporation
Semi Annual Report
For the Fiscal Period ended April 30, 2022 (The 12th Period)
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Primary Data
- Distributions
The 12th Period | The 13th Period | The 14th Period |
Actual distributions per unit | Forecast distributions per unit (Note) | Forecast distributions per unit (Note) |
(Start of cash distribution payment on July | (The Fiscal Period ending October 31, | (The Fiscal Period ending April 30, 2023) |
14, 2022) | 2022) | |
1,267 yen | 1,285 yen | 1,285 yen |
(Forecast: 1,260 yen) | ||
(Note) These forecasts are calculated based on certain assumptions as of June 14, 2022 and subject to change due to conditions such as change in rent income thorough tenant turnovers, acquisition and disposition of assets, and additional unit issuance. The forecasts should not be construed as guarantee of DPU.
| Financial Results | |||||||
(billion yen) | Operating revenue | Net profit | DPU | (yen) | ||||
6 | 4.9 | 5.3 | 5.4 | 5.3 | 4.9 | 5.1 | 5.2 | 1,800 |
1,563 | 1,561 | |||||||
1,600 | ||||||||
4 | 1,436 | 1,429 | ||||||
2 | 1,247 | 1,289 | 1,267 | 1,400 | ||||
1,200 | ||||||||
2.2 | 2.4 | 2.5 | 2.3 | 2.0 | 2.1 | 2.2 | ||
0 | 6th FP | 7th FP | 8th FP | 9th FP | 10th FP | 11th FP | 12th FP | 1,000 |
(Note) MIRAI implemented a four-for-one investment unit split with April 30, 2019 as record date. For the purpose of comparison, the figures before 6th FP are post-split figures.
- Portfolio (as of the End of April 2022)
Acquired 4 new properties worth 10.6 billion yen from the end of the fiscal period ended October 31, 2021.
Number of properties | : 38 | ||||
AUM | : 164.5 billion yen | ||||
Appraisal value | : 177.6 billion yen | ||||
Occupancy rate | : 98.1% | ||||
NOI yield (12th FP result) | : 4.5% *based on book value | ||||
Portfolio PML | : 2.9% | ||||
Ratio by Tenant | Ratio by Asset Type | Ratio by Area | |||
(based on rent) | (based on acquisiton price) | (based on acquisiton price) | |||
Others | Others | ||||
9.5% | 14.4% | ||||
Hotel | Nagoya | ||||
16.1% | area | ||||
Top 10 | Core Assets | 8.9% | Three | ||
Metropolitan | |||||
36.8% | 87.5% | Osaka | Areas | ||
Others | Office | area | 85.6% | ||
63.2% | Tokyo | ||||
Retail | 52.6% | 15.8% | |||
area | |||||
21.7% | 60.9% |
(Note) Ratio by tenant is based on lease contract in place with end tenants as of the end of April 2022.
- Finance (as of the End of April 2022)
Stable financial base maintained on the back of Mitsui & Co.'s credit.
LTV (based on total assets) | : 48.8% |
Long-term fixed interest debt ratio : 100.0% | |
Average interest rate | : 0.56% |
Average remaining maturity | : 3.9 years |
Rating | : Japan Credit Rating Agency, Ltd. (JCR) / A+ (Stable) |
Rating and Investment Information, Inc. (R&I) / A (Stable)
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- ESG
- Increase ratio of assets with environmental certifications
-
April 2022: Obtained DBJ Green Building Certification at Mi-Nara (first retail facility owned by MIRAI)
Aim to increase ratio of assets with environmental certifications through acquisition of new certifications and maintenance and improvement of existing certifications - Ratio of Assets with Environmental Certifications (Note): 60.9% ▶ 74.4% (Note) Based on total floor area excluding land with leasehold interest.
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April 2022: Obtained DBJ Green Building Certification at Mi-Nara (first retail facility owned by MIRAI)
- GRESB Real Estate Assessment (ESG benchmark for real estate)
- First participation in 2021(2 star)
- Multiple improvement measures are being implemented for the 2022 rating upgrade Obtain third-party assurance on environmental data / Tenant Engagement Measures
- 2021: 2 star / Green star ▶ Aiming to improve the rating in 2022
- Contributions to the Local Community
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Cycle & Bus Rides (Mi-Nara)
Participation in a demonstration experiment of health-enhancing and environmentally friendly measures promoted by a regional local transportation company - Recovery accommodation facility for patients with mild cases of COVID-19 Continued to provide as a recovery accommodation facility
(from October 11, 2021 to October 31, 2022 (scheduled))
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Cycle & Bus Rides (Mi-Nara)
- Strengthening Sustainability Disclosure
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Disclosed the GRI Standards Reference Table, an international disclosure standard for sustainability report on MIRAI's website
Plans to enhance sustainability-related disclosures in the future - Future Initiatives
ESG Report: Publication of ESG reports to further enhance sustainability information disclosure
TCFD Disclosures: Prepare for TCFD, a framework for addressing climate-related disclosure
Third-party Assurance for Environmental Data: Obtain third-party assurance to ensure objectivity of disclosed environmental data
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Disclosed the GRI Standards Reference Table, an international disclosure standard for sustainability report on MIRAI's website
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1 Overview of Asset Management
(1) Operating Results of MIRAI Corporation (hereinafter "MIRAI")
The 8th Period | The 9th Period | The 10th Period | The 11th Period | The 12th Period | |||
Period | From Nov. 1, 2019 | From May 1, 2020 | From Nov. 1, 2020 | From May 1, 2021 | From Nov. 1, 2021 | ||
to Apr. 30, 2020 | to Oct. 31, 2020 | to Apr. 30, 2021 | to Oct. 31, 2021 | to Apr. 30, 2022 | |||
Operating revenue | (Million yen) | 5,448 | 5,367 | 4,973 | 5,113 | 5,275 | |
Operating expenses | (Million yen) | 2,583 | 2,744 | 2,652 | 2,716 | 2,727 | |
Operating income | (Million yen) | 2,865 | 2,622 | 2,321 | 2,397 | 2,547 | |
Ordinary income | (Million yen) | 2,595 | 2,378 | 2,073 | 2,144 | 2,245 | |
Net income | (Million yen) | 2,594 | 2,376 | 2,072 | 2,143 | 2,244 | |
Total assets | (Million yen) | 161,027 | 159,222 | 161,815 | 161,226 | 171,982 | |
[Changes from the previous period] | (%) | [5.2] | [(1.1)] | [1.6] | [(0.4)] | [6.7] | |
Net assets | (Million yen) | 75,572 | 75,428 | 75,110 | 75,308 | 80,743 | |
[Changes from the previous period] | (%) | [6.6] | [0.2] | [(0.4)] | [0.3] | [7.2] | |
Interest-bearing debt | (Million yen) | 77,700 | 75,700 | 78,700 | 78,700 | 84,000 | |
Unitholders' capital (Note 3) | (Million yen) | 73,516 | 73,516 | 73,516 | 73,516 | 78,499 | |
Total number of outstanding investment units | (Units) | 1,662,240 | 1,662,240 | 1,662,240 | 1,662,240 | 1,771,440 | |
Net assets per unit | (Yen) | 45,464 | 45,377 | 45,186 | 45,305 | 45,580 | |
Total distributions | (Million yen) | 2,594 | 2,375 | 2,072 | 2,142 | 2,244 | |
Distributions per unit | (Yen) | 1,561 | 1,429 | 1,247 | 1,289 | 1,267 | |
Of which, profit distribution per unit | (Yen) | 1,561 | 1,429 | 1,238 | 1,289 | 1,267 | |
Of which, distributions in excess of earnings per unit | (Yen) | - | - | 9 | - | - | |
Ordinary income to total assets (Note 4) | (%) | 1.7 | 1.5 | 1.3 | 1.3 | 1.3 | |
Net income to net assets (Note 4) | (%) | 3.5 | 3.1 | 2.8 | 2.8 | 2.9 | |
Net assets to total assets at end of period (Note 4) | (%) | 46.9 | 47.4 | 46.4 | 46.7 | 46.9 | |
[Changes from the previous period] | (%) | [0.6] | [0.4] | [(1.0)] | [0.3] | [0.2] | |
Payout ratio (Note 4) | (%) | 100.0 | 99.9 | 99.3 | 100.0 | 100.0 | |
(Note 1) The fiscal period of MIRAI is six months from May 1 to October 31 and from November 1 to April 30 of the following year.
(Note 2) | Unless otherwise stated, all figures are rounded down to the nearest million yen, and percentages are rounded to the first decimal place. | |
(Note 3) | Unitholders' capital does not take into account changes in unitholders' capital due to the implementation of distributions in excess of earnings related to the reserve for adjustment of temporary differences, etc. | |
(Note 4) | Calculated based on the following formula. | |
Ordinary income to total assets | Ordinary income / {(Total assets at beginning of period + Total assets at end of period) / 2} * 100 | |
Net income to net assets | Net income / {(Net assets at beginning of period + Net assets at end of period) / 2} * 100 | |
Net assets to total assets at end of period (%) | Net assets at end of period / Total assets at end of period * 100 | |
Payout ratio | Total distributions (excluding distributions in excess of earnings) / Net income * 100 |
- Summary of Operating Results for the Fiscal Period under Review
(i) Main History of MIRAI
MIRAI is diversified J-REIT. Based on the Act on Investment Trusts and Investment Corporations of Japan (Act No. 198 of 1951; including revisions enforced thereafter) (hereinafter "AITIC"), MIRAI was founded on December 4, 2015 with a capital contribution of 150 million yen (750 units), by Mitsui Bussan & IDERA Partners Co., Ltd. (hereinafter the "Asset manager") as the founding planner and was listed on the REIT section of the Tokyo Stock Exchange on December 16, 2016 (securities code: 3476). During the fiscal period under review, MIRAI conducted a public offering in December 2021 and a third-party allotment in January 2022. As of April 30, 2022, the total number of outstanding investment units are 1,771,440 and MIRAI owns 38 properties (total acquisition price of 164,554 million yen).
MIRAI positions assets located in the three major metropolitan areas of Japan with high population concentrations as its main investment targets and aims to obtain mid-to-long term stable cash flows and sustained growth in unitholders' value by building a portfolio centered on its "Core Assets" (Note).
(Note) "Core Assets" means the assets that constitute the core of MIRAI's portfolio. Specifically, among traditional investment properties such as offices, retail properties, hotels, residential and logistics properties. Occupancy rates of 80% or more must be secured in principle (including cases where such occupancy rates are expected) with MIRAI to determine a stable rental income to be expected.
(ii) Operating Environment and Business Performance
During the fiscal period under review, the Japanese economy continued to be affected by COVID-19. Occupancy rates in the hotel sector have been affected by the spread of infection, MIRAI must continue to monitor the future trend. In the retail sector, although operational methods in COVID-19 crisis are becoming established, the negative impact of the increasing number of infections continues. Even in this environment, various measures to improve attractiveness have been effective at Mi-Nara, a retail complex in Nara Prefecture. In the office leasing market, cancellations due to changes in work styles, such as teleworking, and deterioration in corporate performance continue to be apparent in some properties, while the vacant spaces are being backfilled.
Under such circumstances, MIRAI acquired 4 properties in total: "Ehime Building/Hiroshima (acquisition price: 2,780 million yen)",
"Tsurumi Fuga 1 (acquisition price: 5,300 million yen)" , "BIGMOTOR Ginan (land) (acquisition price: 1,080 million yen)" on January
12, 2022, and "Yokohama-Daikokucho Maintenance Center (land) (acquisition price: 1,490 million yen)" on March 25, 2022. As a result,
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as of the end of the 12th fiscal period, MIRAI had 38 properties under management, with a total acquisition price of 164,554 million yen, a total leasable area of 372,290.09 sqm, and occupancy rate of 98.1%.
(iii) Overview of Fund Procurement
During this fiscal period under review, MIRAI raised 4,746 million yen by issuance of new investment units through a public offering (104,000 units) on December 24, 2021 and 237 million yen by a third-party allotment (5,200 units) on January 25, 2022. As a result, the balance of unitholders' capital as of the end of the 12th fiscal period was 78,499 million yen and the total number of outstanding investment units was 1,771,440 units. MIRAI borrowed long-term borrowings of 8,800 million yen and issued #5th Investment Corporation Bond of 1,200 million yen on November 30, 2021 to repay borrowings of 10,000 million yen maturing on the same day. In addition, MIRAI borrowed 4,000 million yen in long-term borrowings on January 12, 2022 and 1,300 million yen in long-term borrowings on March 25, 2022 to fund the acquisition of real estate trust beneficiaries. The balance of borrowings and investment corporation bonds as of the end of the 12th fiscal period was 84,000 million yen (of which 7,000 million yen was current portion of long- term borrowings, 70,800 million yen was long-term borrowings, and 6,200 million yen was investment corporation bonds).
For the purpose of securing flexible and stable fund procurement and structuring an even stronger financial base, MIRAI has established a commitment line with a maximum borrowing amount of 3,000 million yen (the balance of unexercised credit line as of the date of this document is 3,000 million yen).
(iv) Operating Results and Distributions
As a result of the above operation, MIRAI recorded operating revenue of 5,275 million yen, operating income of 2,547 million yen, ordinary income of 2,245 million yen, and net income of 2,244 million yen for the 12th fiscal period.
Profit distributions for the current fiscal period (excluding distributions in excess of earnings) shall be made in accordance with the distribution policy set forth in the Articles of MIRAI and in accordance with Article 67.15 of the Act on Special Measures Concerning Taxation (Law No. 26 of 1957, including subsequent amendments. hereinafter the "Act on Special Measures Concerning Taxation"), MIRAI decided to distribute 2,244,414,480 yen, which is the entire amount after deducting the reversal of the provision for adjustment of temporary differences, etc. (as defined in Article 2, Paragraph 2, Item 30 of the Rules of Account Settlement of Investment Corporations) from the income as defined in Article 136, Paragraph 1 of the AITIC, except for fractions of less than one yen, in an attempt to make profit distributions tax-deductible. As a result of the above, the distributions per investment units for the fiscal period under review (excluding distributions in excess of earnings) was 1,267 yen.
(3) Status of Capital Increase, etc.
Changes in the total number of outstanding investment units and unitholders' capital over the past five years are as follows.
Total number of outstanding investment units | Unitholders' capital (Thousand yen) (Note 1) | ||||||||||||||||||||||||
Date | Summary | (units) | Remarks | ||||||||||||||||||||||
Changes | Changes | Balance | |||||||||||||||||||||||
Balance | |||||||||||||||||||||||||
May 23, 2018 | Capital increase through public offering | 43,300 | 337,050 | 7,395,250 | 59,287,585 | (Note 2) | |||||||||||||||||||
June 12, 2018 | Capital increase through third-party allotment | 2,160 | 339,210 | 368,908 | 59,656,493 | (Note 3) | |||||||||||||||||||
November 1, 2018 | Capital increase through public offering | 53,500 | 392,710 | 8,965,583 | 68,622,077 | (Note 4) | |||||||||||||||||||
November 27, | Capital increase through third-party allotment | 2,700 | 395,410 | 452,468 | 69,074,546 | (Note 5) | |||||||||||||||||||
2018 | |||||||||||||||||||||||||
May 1, 2019 | Split of investment units | 1,186,230 | 1,581,640 | - | 69,074,546 | (Note 6) | |||||||||||||||||||
December 24, | Capital increase through public offering | 76,500 | 1,658,140 | 4,215,609 | 73,290,155 | (Note 7) | |||||||||||||||||||
2019 | |||||||||||||||||||||||||
January 21, 2020 | Capital increase through third-party allotment | 4,100 | 1,662,240 | 225,934 | 73,516,089 | (Note 8) | |||||||||||||||||||
December 24, | Capital increase through public offering | 104,000 | 1,766,240 | 4,746,456 | 78,262,545 | (Note 9) | |||||||||||||||||||
2021 | |||||||||||||||||||||||||
January 25, 2022 | Capital increase through third-party allotment | 5,200 | 1,771,440 | 237,322 | 78,499,868 | (Note 10) | |||||||||||||||||||
(Note 1) Changes in unitholders' capital due to the implementation of distributions in excess of earnings related to the reserve for adjustment of temporary differences, etc. have not been taken into account.
(Note 2) New investment units were issued at the price of 176,962 yen per unit (paid-in amount: 170,791 yen) through a public offering for the acquisition of new properties, etc.
(Note 3) New investment units were issued at the price of 170,791 yen per unit through third-party allotment in connection with a public offering for the acquisition of new properties, etc.
(Note 4) New investment units were issued at the price of 173,452 yen per unit (paid-in amount: 167,581 yen) through a public offering for the acquisition of new properties, etc.
(Note 5) New investment units were issued at the price of 167,581 yen per unit through third-party allotment in connection with a public offering for the acquisition of new properties, etc.
(Note 6) MIRAI conducted a four-for-one unit split with April 30, 2019 as the record date and May 1, 2019 as the effective date.
(Note 7) New investment units were issued at the price of 57,037 yen per unit (paid-in amount of 55,106 yen) through a public offering for the acquisition of new properties, etc.
(Note 8) New investment units were issued at the price of 55,106 yen per unit through third-party allotment in connection with a public offering for the acquisition of new properties, etc.
(Note 9) New investment units were issued at the price of 47,238 yen per unit (paid-in amount of 45,639 yen) through a public offering for the acquisition of new properties, etc.
(Note 10) New investment units were issued at the price of 45,639 yen per unit through third-party allotment in connection with a public offering for the acquisition of new properties, etc.
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Mirai Corporation published this content on 01 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 August 2022 01:43:05 UTC.