Advance Residence Investment (3269) Q4 2025 earnings summary

Executive summary

• Jan. 2025 DPU was ¥5,975, up 0.8% QoQ and above the ¥5,930 forecast; EPU excluding property-sale gains was ¥5,104 and adjusted EPU was ¥5,532.

• Record rent growth and internal and external growth supported results, while remodeling vacancies and higher refinancing costs remained pressures.

Financial highlights

• Revenue was ¥18,364M, operating income ¥8,249M and net income ¥7,315M; revenue and operating income fell 1.8% and 5.5% from the prior period, respectively.

• NOI rose 1.4% from the prior period to ¥13,873M; FFO per unit was ¥7,607, up 1.1%.

• DPU of ¥5,975 included ¥207 per unit from retained earnings and ¥234 from fixed-amount reserve reversal; total distributions were ¥8,562M.

• Appraised unrealized gains were ¥274.4B, or 59.5% of book value; NAV per unit was ¥356,586, up 0.6% from the prior period.

Outlook and guidance

• Split-adjusted DPU is forecast at ¥3,005 for both Jul. 2025 and Jan. 2026; distributions excluding distributions in excess of earnings are forecast at ¥3,005 and ¥2,570, respectively.

• Jan. 2026 EPU excluding sale gains is forecast at ¥2,542 versus ¥2,570 for Jul. 2025; adjusted EPU is forecast at ¥2,769 versus ¥2,782.

• Target adjusted EPU is at least ¥2,875, with DPU of at least ¥3,000 excluding retained-earnings distributions and property-sale gains.

• Remodeling targets 8,000 units over ~13 years, mainly in Tokyo’s 23 wards; assumed project ROI is at least 6.2%, with project profit and loss expected to break even in five years if rent increases persist.

• Forecast occupancy is 96.0% through Jan. 2026; extraordinary expenses are expected to weigh on adjusted EPU, while sale gains and reserves support DPU.