Competitive portfolio
A well-located portfolio
When JLF first listed in 2005, there were few other investors targeting logistics properties. That put JLF in a position to acquire prime properties in favorable locations with little competition and at relatively advantageous terms.
This well-located portfolio built based on first comer's advantage is one of JLF's major strengths.
For a logistics property, a favorable location features access to transportation infrastructure such as highways, major roadways, and air and sea ports, as well as excellent access to areas of consumption.
For example, in the Tokyo Metropolitan Area, the Tokyo Bay Area is known as a prime location for logistics properties, and sites along the beltways Tokyo Gaikan Expressway and National Route 16 are well suited for logistics applications. Moreover, the growth of e-commerce in recent years has increased demand for logistics properties, triggering logistics development projects further and further away from the city center. As a result, many logistics properties have been located along the Metropolitan Inter-City Expressway, Tokyo’s outermost ring road.
At JLF, a great portion of its portfolio is located inside the National Route 16 beltway, which includes the Tokyo Bay Area. JLF enjoys a concentration in favorable logistics locations.
These well-located properties, which offer superb access to consumers in the heart of Tokyo, sustain demand even in economic downturns, greatly enhancing the stability of JLF's portfolio.
*Investment ratio of properties located inside Route16 is calculated based on acquisition price as of March 15, 2024.
- Located inside Route 16
- 67.1 %
A stable revenue base
Lease periods in office and residential properties typically last about 2 years. In logistics properties, however, leases are for 3 to 5 years, or in some cases, as long as 10 or more years. Moreover, many logistics leases stipulate fixed rents. These factors enhance the stability of rental income in logistics properties.
Moreover, because logistics services that deliver goods to consumers and businesses are an essential part of day-to-day economic activities, regardless of economic trends, demand to lease logistics space tends to be less impacted by economic swings compared to office, hotel and other asset types.
- Weighted Average Lease Period
- 10.6 years
- Weighted Average Lease Expiry
- 4.4 years
* Figures are as of March 15, 2024.
Abundant unrealized gains
As Japan's first logistics REIT, JLF has leveraged its firstcomer's advantage to acquire excellent properties in favorable locations at relatively advantageous terms. Moreover, since acquisition, the value of these assets has been maintained and enhanced through their appropriate management.
As a result, JLF boasts a high unrealized gain(*) as a percentage of the portfolio compared to other J-REITs.
The large unrealized gain provides the following 2 advantages.
(1) When an asset is sold, the capital gain can be leveraged to increase unitholder returns.
(2) In the event of a decline in real estate prices triggered by a financial crisis, for example, the portfolio assets enjoy a larger buffer before suffering a paper loss, helping stabilize JLF’s financial standing.
* Unrealized gain as % of portfolio = {(Total appraisal value – Total book value) / Total book value} x 100%