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  3. Our commitment to a diverse society

Our commitment to a diverse society

Sustainability policies
– Our commitment to a diverse society –

We contribute to the diversity of society while taking into account the social impact of our properties. We are committed to maintaining safety, confidence, good health, comfort and diversity regarding our tenants and the communities where we operate.

Providing properties with environmental and social considerations

Basic views

Providing properties with environmental and social considerations is one of our material issues. Through our investments in many types of properties, we are making a contribution to lowering the overall environmental impact of society, providing greater convenience and achieving other forms of progress.

Investments in various types of properties through REITs

The three listed REITs where Kenedix is the main sponsor and a private REIT specialize in specific categories of real estate. The operations of each one reflect the characteristics of its respective market sector, resulting in highly transparent asset management. REITs are based on the premise that real estate will be owned and operated for a long-term. Therefore, investment and property management activities take into account environmental and social issues. Adopting this stance enables these REITs to help invigorate communities, provide greater convenience, supply pleasant and productive workplaces, and create safe and secure places to live.

REIT Investment targets
Kenedix Office
Investment Corporation
Mid-sized office buildings in the Tokyo metropolitan area where economic activities are densely integrated with abundant tenant demand and rich stocks of properties
Kenedix Residential Next
Investment Corporation
Residential facilities, healthcare facilities and accommodation where people live and stay
Kenedix Retail REIT
Corporation
Neighborhood, community and other shopping centers for daily needs located within residential districts or adjacent to major roads or streets and distribution centers that deliver merchandise directly to consumers
Kenedix Private
Investment Corporation
Large-sized office buildings, and hotels and commercial facilities with long-term leases that are asset types suitable for long-term stable management

Investments in flexible / mixed use properties

Kenedix uses funds and other schemes for investments in large, multi-purpose properties. By utilizing areas of our building sites set aside for public use and providing properties for a broad range of applications, we contribute to tenants and residents of our buildings as well as everyone living in the surrounding area.

All of our REITs as well are making investments in multi-purpose properties that cover a diverse array of activities. One example is office buildings, residential properties and hotels designed to meet the needs of retail tenants on lower floors. Another is properties with multi-uses, such as stores, medical clinics and private nursing homes, that are directly linked to a railway station.

In addition, concerning Chofu Center Building, Kenedix Office Investment Corporation has acquired office wing of the building and Kenedix Retail REIT Corporation has acquired retail wing of the building, respectively. This is the first joint acquisition of a mixed use property by group REITs.

Affordable real estate leasing

88 buildings, about 91% of Kenedix Office Investment Corporation portfolio is mid-sized offices (approx. 83% by acquisition price) and among them, the tenants who leased less than 200 tsubo (about 660 m2 as 1 tsubo = 3.3 m2 ) that Kenedix Office Investment Corporation has been recognizing them as micro, small and medium-sized enterprises, account for 86.9%. Kenedix Office Investment Corporation and the asset management company are aiming to contribute to development in Japanese economy as well through providing better working environment for those mid-small sized companies that are the base of Japanese economy. (ratios are as of October 31, 2019)

  • Breakdown of the number of tenants by leased floor area(Note)
    Breakdown of the number of tenants by leased floor area
  • Business office by the number of employees (Tokyo)(Source)
    Business office by the number of employees
  • (Note) based on the number of tenants in each office building. Tenants leasing more than one property are counted as 1 tenant for each building without aggregating by name-base
  • (Source) Complied by Kenedix Real Estate Fund Management, Inc. based on “2014 Economic Census for Business Frame Tokyo (revised results) (as pf March 27, 2017)”

Renovations of existing buildings

Expertise acquired since the start of real estate securitization in Japan enables us to recognize the potential value of existing buildings we purchased in the real estate market and produce the greatest possible value by performing renovations.

Bunka Hostel Tokyo Topics: Bunka Hostel Tokyo
This project by Space Design, Inc., a member of the Kenedix Group, resulted in the effective utilization of a 34-year-old commercial building on an Asakusa street with little foot traffic. Transforming the building into a hostel has made this area more lively and attracted foreign tourists. In recognition of the significance of this initiative, the project received a Good Design Award 2016 in the regional/community development and social contribution activities category. In 2019, the project also received the 3rd Taito City Landscape Town Development Award (Renovation category.)

KDX Iidabashi Square Topics: KDX Iidabashi Square
KDX Iidabashi Square, which is owned by Kenedix Office Investment Corporation, was completely renovated after the departure of a tenant that had leased the entire building. Floor layouts were altered to accommodate many tenants, an efficient HVAC system and LED lights were installed to reduce electricity use, and other improvements were made. The building has DBJ Green Building certification and received BELS (Building-Housing Energy-efficiency Labeling System) recognition. The building was fully occupied only about six months after the renovation was finished.

KDX Residence Tsurumi Topics: KDX Residence Tsurumi
KDX Residence Tsurumi, which is owned by Kenedix Residential Next Investment Corporation, was constructed as a residence for families more than 25 years ago. We remodeled apartments as needed when they became vacant. The value is high due to the small number of apartment buildings designed for families. Updates for apartment configurations, kitchens and bathrooms quickly attracted new tenants and made it possible to increase the rent.

Urban redevelopment projects

Kenedix Inc. takes part in urban redevelopment projects through its real estate development funds and other schemes.

Cooperation with Re-Seed

Cooperation with Re-Seed

We are participating in a hotel redevelopment project in the Roppongi district of Tokyo and will operate the property after its completion. This is a joint project with Real Estate Sustainability & Energy Efficiency Diffusion Organization (Re-Seed), which promotes the construction of high-quality buildings that can withstand earthquakes and are environmentally responsible. The previous building will be replaced by a quality structure with outstanding environmental and other characteristics. This project uses a sophisticated business structure. We received certification under the Real Estate Specified Joint Enterprise Act and are using a special business scheme designated by this act.

Reuse of underground piles

Reuse of underground piles

At Kenedix redevelopment projects in central Tokyo, the foundation piles of previous buildings are being reused in order to eliminate the cost of removal and replacement as well as the need to dispose of these piles. After a confirmation of their safety and structural integrity, existing piles will be used for the redevelopment of the Shinsei Bank head office site in Hibiya, hotel redevelopment projects in Roppongi and Ginza, and other projects.

Issuance of social bonds

Kenedix Residential Next Investment Corporation has issued the social bonds with an aim to contribute to the expansion of a new investor base and the development of the domestic social bond market by further enhancing initiatives for sustainability through the efforts made this time and providing investment opportunities to investors who are proactively conducting ESG investment.
Kenedix Residential Next Investment Corporation received “Social 1(F),” the highest rating in “JCR Social Finance Framework Assessment,” from Japan Credit Rating Agency, Ltd. (JCR) with regard to the eligibility of social finance framework. The Investment Corporation bonds have been issued as social bonds in accordance with the Framework.

Providing investment opportunities through real estate crowdfunding

bitREALTY

We are developing the real estate crowdfunding business “bitREALTY” to provide more people with opportunity to invest in unlisted real estate investment funds, which were previously limited to some institutional investors. Starting full-scale operations in January 2019, we have provided a new era service that allows to invest in various real estate investment funds via the internet. We have organized seven funds for hotel, rental housing and childcare facilities, and have completed a total of 1.5 billion yen in offerings so far.

Improving resilience/climate adaptation

Basic views

Becoming more resilient to natural disasters, including the effects of climate change, is one of our material issues. We use many activities at our properties to ensure the safety and security of tenants, residents, and everyone who uses these properties or lives nearby.

Preparedness for natural disasters and other emergencies

Emergency supplies

Emergency supplies

Emergency supplies are installed in some properties.
In some buildings owned by Kenedix Office Investment Corporation, elevators have emergency preparedness items for use in the event an elevator stops due to an emergency, power outage, malfunction or other reason.
At properties owned by Kenedix Residential Next Investment Corporation, disaster readiness supplies such as food and drinking water are stored in the building manager's office or other locations that are easily accessible for residents.

Free Wi-Fi

Free Wi-Fi

To provide tenants with a more disaster-resistant internet environment, Kenedix Office Investment Corporation uses Hikari Station Wi-Fi routers at some of its properties.
Free access to the internet via a wireless network is provided to tenants during an emergency for business continuity. At other times, tenants and visitors can use Wi-Fi for a certain time for free.

Disaster response vending machine

Disaster response vending machine

Some properties owned by Kenedix Residential Next Investment Corporation have vending machines with beverages that can be removed at no charge in the event of a natural disaster or other emergency even if there is no electricity.

Distribution of emergency action manual handbook

Distribution of emergency action manual handbook

Kenedix Office Investment Corporation published a pocket-sized, portable emergency action manual handbook and distributed to tenants for emergencies including major earthquakes. The handbook contains various helpful information in an emergency such as response to major earthquakes, emergency relief activities and how to use AED, etc.

Sustainable Guide

Sustainable Guide

For the purpose of enabling the comfortable, safe and secure living of tenants, distribution of guides on sustainability containing information on initiatives on energy consumption, sorting of waste, and disaster preparedness.

Provision of evacuation sites

Provision of evacuation sites

Kenedix Retail REIT Corporation has agreements with Yoshikawa City and Ina Town that allow part of Unicus Yoshikawa and Unicus Ina, respectively, to be used as a temporary shelter during an emergency.

Installation of AEDs

bitREALTY

AEDs (Automatic External Defibrillator) are installed at some properties.
AEDs in office buildings owned by Kenedix Office Investment Corporation are available not only for the tenants but for visitors and local communities as well, which is displayed on the AED stickers and registered in the administrative map.
In retail facilities owned by Kenedix Retail REIT Corporation, AEDs for public use are installed near information centers and other convenient locations.

Verification of earthquake resistance

Before acquiring a property and in conjunction with other transactions, Kenedix receives an engineering report that covers the building, various equipment, environmental properties and other items. We use this report to confirm the building's resistance to earthquakes. If a building does not meet the standards, we complete the purchase only after the completion of seismic reinforcement work.
We also receive a probable maximum loss report prior to acquiring a building. This allows us to determine the maximum risk exposure associated with an earthquake.

The DBJ disaster preparedness rating Topics: Debt financing based on the DBJ disaster preparedness rating
The DBJ disaster preparedness rating (current DBJ BCM rating) is a financing scheme in which companies undergo evaluations regarding disaster preparedness and business continuity initiatives based on the proprietary assessment system developed by the Development Bank of Japan (DBJ). Terms for loans are then determined in accordance with the assessment.
Kenedix Office Investment Corporation is the first J-REIT that has received a loan from the DBJ in 2011 based on the DBJ disaster preparedness rating.

Initiatives for an aging society with fewer children

Basic views

Japan's population has been declining since 2008 as the country's population becomes older and the number of children falls. As the already large number of older people continues to climb, the shortage of healthcare facilities will become an even more serious problem. On the other hand, we also recognize that the wait-listed children for childcare facilities in urban areas due to women’s advancement in society and lack of nursery teachers is also a social issue.

Initiatives for an aging society with fewer children are one of our material issues. We are making investments in healthcare facilities and childcare facilities and using other activities to meet the needs of Japan's aging population.

Management of healthcare facilities

Kenedix Residential Next Corporation has made investments in healthcare facilities and plans to continue these investments in order to help meet the growing demand for health care by purchasing and operating these facilities.

Healthcare investments cover a variety of business sectors. Acquisitions include fee-based homes for the elderly and serviced housing for the elderly as well as investments in senior living intermediate nursing home, which is a first for a J-REIT.

Management of healthcare facilities

Kenedix Residential Next Corporation (KDR) is dedicated to growing along with the operators of properties it owns by providing the best solutions for their business and facility management issues and other needs. KDR fully understands the philosophy, business operations and other characteristics of these partners. Operators of properties fully understand KDR's investment philosophy, management policies and other guidelines. This mutual understanding results in business partner relationships that go well beyond the conventional boundaries of ties between a building owner and a tenant.

Management of childcare facilities

We have invested in childcare facilities in Tokyo through private real estate fund. Through this initiative, we work with operators to help solve the problem of wait-listed children for childcare facilities in urban areas and provide investors with opportunities to invest in socially significant assets.

In addition, Kenedix Residential Next Investment Corporation changed its asset management guidelines in September 2019 and has newly added childcare facilities as investment targets. We believe that investing in childcare facilities by a listed REIT that manages assets for a long period can lead to the promotion of the future supply of childcare facilities and has great social significance.

Commitment to barrier-free access

Office buildings, shopping centers and other real estate at the Kenedix Group have facilities for easy accessibility for everyone regardless of physical limitations.

Relevant data

2016 2017 2018 2019
Number of healthcare properties
managed by Kenedix Group REITs
14 14 21 24
AUM of healthcare properties
managed by Kenedix Group REITs
(¥ million)
27,965 27,965 44,442 54,128