Asset Management Policies
| Basic Policies | Investment | Management | Finance | Nomura Real Estate Group |
Collaboration with Nomura Real Estate Group
The Asset Management Company, Nomura Real Estate Asset Management (NREAM) shall manage the investment portfolio of Nomura Office Fund (NOF) utilizing its accumulated knowledge and experience. At the same time, NREAM shall leverage the strengths of the Nomura Real Estate Group to secure stable earnings and steady portfolio growth for NOF.
(1) Information Provided by the Nomura Real Estate Group Companies
- The Nomura Real Estate Group; Properties Held and Development Projects
NREAM has concluded fundamental memoranda of agreement regarding the flow of real estate related information (the "Agreements") with Nomura Real Estate Development (NRED) and Nomura Real Estate Urban Net.
Based on the Agreement, when NRED and Nomura Real Estate Urban Net intend to sell properties held or under development which meet NOF's investment criteria, they shall, in principle, provide the related information to NREAM prior to disseminating the information to other third-parties.
- Properties Brokered by the Nomura Real Estate Group Companies
NRED and Nomura Real Estate Urban Net are engaged in brokerage services of commercial real estate.
Based on the Agreement, NRED and Nomura Real Estate Urban Net shall promptly provide NREAM with the information regarding those properties for which either company acts as sales agent and which meet NOF's investment criteria, excluding those properties where the seller specifically requests otherwise.
As a result, NOF is well positioned to access in a timely fashion, the real estate data accumulated throughout the Nomura Real Estate Group network.
(2) Other Proposed Real Estate Sales
NREAM has executed a memorandum regarding the handling of real estate sales information (the "Memorandum") with Nomura Real Estate Investment Management (NREIM).
Based on the Memorandum, NREIM shall provide information relating to the sale of properties, consistent with certain criteria*, as described below, to NREAM, prior to, or at the same time, information is disseminated to third parties, unless the seller specifically requests otherwise. NREAM shall treat NOF as the purchaser candidate with first priority for a fixed period after information disclosure.
As a result, NREAM is well placed to evaluate and determine the acquisition of real estate.
Property information provided by NREIM shall conform to the following criteria:
- Principal use - office
- Located in the three major urban areas and other large cities, including the government-designated cities in Japan.
- Total floor space more than 3,000 tsubo per building
- Conform to current earthquake resistance standards or equivalent standards. In principle, the probable maximum loss (PML) caused by an earthquake should be less than 20%. Reinforcement work for earthquake-resistance or other similar measures to be undertaken in the short term for properties with PML of 20% or more.
- Total leased floor space exceeding 90% of total leasable floor space and the prospect of total leased floor space exceeding 90% within a six-month period.
(3) Provision of Research-related Services
NREAM has concluded the Service Agreement with NRED on April 3, 2006. Under such agreement NRED shall gather information and provide analytical support services with the aim of increasing efficiency in asset management.
NREAM shall receive research and analysis of market trends including general economic analysis, real estate purchase and sale markets, office building leasing and capital markets based on the agreement.
