EAST Japan Railway (JR East) has established the JR East Private Reit Investment Corporation as it seeks to expand its property asset ownership and management model.

JR East says it has achieved its initial Yen 100bn ($US 762m) asset ownership target for its entire property fund business and is now seeking to reach Yen 300bn of assets under management by the end of fiscal year 2025.

JR East Real Estate Investment Advisors is the asset manager for JR East Private Reit Investment, the activities of which will commence next month.

JR East says it plans to sell properties it has developed and owns to private real estate investment trusts (Reit) and to establish development profits at an “early stage.” These funds in turn will be reinvested in “growth areas.”   

“This will enable us to realise a variety of attractive urban development projects that utilise the strengths of the JR East Group, with the aim of achieving further growth for the group,” JR East says.

It is hoped the programme will accelerate the delivery of JR East’s 10-year Move-Up 2027 Strategy, which seeks to grow sources of revenue other than rail operations to provide long-term financial sustainability for the railway in light of changing social habits in Japan.

An in-depth feature on JR East’s Move-Up 2027 Strategy appeared in the December 2019 edition of IRJ. Digital subscribers can read it here.