Rubicon Japan Trust (RJT) was formed to provide prospective investors exposure, through an ASX listed vehicle, to a portfolio of Japanese commercial real estate and a platform for future investment opportunities in the Japanese real estate market.

To achieve this objective, RJT has been acquiring Japanese real estate investments that will lead to the enhancement of risk-adjusted returns to Investors. To minimise income volatility RJT will finance acquisitions with long term fixed rate debt and will enter into foreign exchange hedges over forecast income. RJT will also seek to partially protect Investors from fluctuations in equity capital due to adverse movements in foreign exchange rates.

DTZ is a global real estate advisory company with over 10,000 staff in 200 offices throughout 40 countries. In Asia, DTZ has over 5,500 staff in 24 offices located in 7 countries.

During the last 12 months DTZ has advised on over ¥315 billion (A$3.6 billion) of capital transactions in Asia and over ¥1.335 trillion ($A15.1 billion) of transactions in the last 5 years. DTZ currently manages over 25 million square metres of properties in Asia and has valued over ¥8.13 trillion (A$90 billion) in the last 12 months.

In considering future acquisitions, the key objective will be the enhancement of risk-adjusted returns to Investors, taking into account both initial and expected future returns. Benefits to Investors may include the potential to increase earnings and distributions and the reduction in risk due to the further diversification of RJT’s portfolio. For future acquisitions, the Manager has adopted criteria (to be reviewed annually) which include the following:

• Properties in which interests are acquired are expected to provide:
  • sustainable net operating income
  • the opportunity for returns to be generated from repositioning, more effective asset management or redevelopment/development where the risks associated with such projects can be reasonably mitigated
  
  
• Properties to be acquired at or below fair market value
  
  
• Commercial real estate loans entered into by private and corporate owners of real estate in Japan whose financing requirements may not be met by traditional lenders. This element of the investment strategy is designed to draw on the strengths of RJT’s established real estate platform in Japan and Rubicon’s well developed origination and investment capabilities in relation to commercial real estate finance.

All assets acquired will be subject to due diligence consistent with prudent practice adopted by international investors investing in the Japanese real estate market.