Properties Handling Policy

(1)Property information collection operations
In addition its own information sources, TOKYU REIT shall seek property information from a wide range and make an effort to collect highly reliable information.
 
 

(2)Property assessment operations
A.Property assessment
Properties shall be assessed based on internal rules of the asset management company separately stipulated.

B.Outsourcing to experts
TOKYU REIT can outsource portions of investigation items to an expert when assessing properties. When selecting experts, a comprehensive evaluation shall be conducted in a fair manner by taking into consideration expertise, cost-benefit performance, independence, etc.
 
 

(3)Property delivery operations
In principle, the asset management company shall deliver property by itself based on internal rules of the asset management company separately stipulated.
 
 

(4)Property management operations
A.Property management policy
In an aim to maximize the cash flows of each property from a medium- to long-term perspective, TOKYU REIT shall strive to enhance tenant satisfaction and reduce costs by implementing the following.
　Duly ascertaining tenant needs by establishing trust relationships with tenants
　Tenant marketing by assessing market trends
　Efficient management and operations by giving consideration to cost-benefit performance

B.Selection criteria for a property management company
In principle, a selection will be made out of Tokyu Corporation and its subsidiaries based on their tenant marketing ability backed by an information network on retail tenants and local contacts, as well as cost reduction wrought about by their economies of scale. However, TOKYU REIT is not prevented from selecting companies other than Tokyu Corporation and its subsidiaries based on a property’s characteristics, continuity of management and various other circumstances. As measures to avoid conflicts of interest, outsourcing terms and conditions shall be decided in view of market rates, content of services provided and operational volume. Relevant rates of fees, contract period and cancelation terms and conditions shall be disclosed. With regards to relevant rates of fees, a written opinion on their adequacy based on the terms and conditions of the said contract shall be acquired beforehand from a third party who possesses expert knowledge, and shall be submitted to TOKYU REIT’s board of directors as decision-making reference. After having gained prior approval, the results will be disclosed(please refer to this page.).

C.Renewal of property management contracts
(i)Performance checks shall regularly be conducted by the asset management company. In the event the company does not meet criteria set forth by the asset management company, the contract shall not be renewed.
(ii)With regards to the rates of fees at the time of renewal, a written opinion on their adequacy based on the terms and conditions of the said contract shall be acquired beforehand from a third party who possesses expert knowledge, and shall be submitted to TOKYU REIT’s board of directors as decision-making reference. After having gained prior approval, the results will be disclosed(please refer to this page.).
 
 

(5)Policy on repairs and maintenance and capital expenditure
TOKYU REIT shall conduct repairs and maintenance, or expend capital after having prepared an efficient repair and maintenance plan for each property that would lead to maintenance and improvement of the property’s competitiveness from a medium- to long-term perspective. Upon implementation, TOKYU REIT shall, in principle, carry them out within the limits of depreciation expenses of each property, but shall also make a judgment by considering the depreciation expenses of the entire portfolio. However, it shall begin implementation at an early stage starting from properties where such action is required from a tenant marketing policy perspective. Furthermore, in the future, in the event aseismic reinforcement becomes necessary, TOKYU REIT shall immediately implement reinforcement constructions while giving consideration to tenant marketing conditions.
 
 

(6)Policy on placing insurance such as non-life insurance
In order to avert the risk of buildings receiving damage as a result of disasters, accidents, etc., earnings decreasing, or receiving requests for indemnity from a third party, TOKYU REIT shall, in principle, place fire insurance, rent insurance and liability insurance on real estate it owns.
Furthermore, TOKYU REIT shall ensure management is conducted so that the PML of the total portfolio does not go below 10%. In the event that it exceeds this level, however, the company shall place earthquake insurance. When deliberating the placement of insurance, a decision shall be made after comprehensively assessing insurance premiums, deductible amounts, cash reserves, etc.
 
 

(7)Other operations
Business partners related to other operations, including the ordering of constructions, shall be selected after comprehensively assessing content of services provided, costs, etc.

▲Page Top