Real Estate Investment Fund by RISA and a Design Firm in Tokyo and Saitama (Nikkei Sangyo Newspaper)

Dec 1st, 2003

RISA Partners, Inc.(President, Mr. Atsushi IMUTA), a real estate investment management company, will tie-up with a design company and set up a real estate investment fund aimed at revitalizing dormant non-performing assets at the end of this December. The initial size of the fund will be around 1 billion yen which seeks a higher return than similar funds by providing design-oriented solutions for target properties.

The “R Fund” will hold an office building in Chuo-ward, Tokyo, and 2 apartment complexes in Kawagoe City in Saitama Prefecture. The investment in the Tokyo property is a joint project of RISA Partners, Inc. and IDEE, a design company based in Tokyo. The building used to house small offices and retail stores but has been completely refurbished. Another design company has joined RISA Partners, Inc. in the Kawagoe property which has already been fully remodeled for offices and apartments, part of which used to be occupied by a Pachinko parlor and video game arcades.

Both properties were either subject to a court administered auction after foreclosure or mortgaged, and have been acquired on a discount to the prevalent market. RISA Partners, Inc. will then try to put on an added value with the cooperation of the design companies. The properties will be acquired by the “R Fund” at the end of December.

A foreign investor, high net-worth individuals and RISA Partners, Inc. each participate in a Tokumei Kumiai arrangement with the Fund and invest 350 million yen in total. SANYO Electric Credit Co., Ltd. will provide a non-recourse loan, which relies only on the properties’ ability in generating cash flow for repayment.