Japan Logistics Fund (8967) H2 2025 earnings summary

Executive summary

• DPU for FP 2026/1 reached JPY 2,300, up 7.0% versus forecast and previous period, driven by capital gains and stable leasing, with net income rising 5.0% to JPY 6,406M.

• FFO per unit is forecast to grow 2.8% from FP 2026/1 to FP 2027/1, targeting JPY 2,500 by FP 2028/1, surpassing the annual growth target of 2.2%.

• Portfolio comprised 52 logistics properties with a total acquisition price of JPY 293.4B and total assets of JPY 274.1B.

• Capital recycling and rental growth strategies are delivering steady progress, with re-leasing spreads and renewal rates above targets.

• The logistics leasing market showed stable or improving rents and declining vacancy rates in key metropolitan areas.

Financial highlights

• Net income for FP 2026/1: JPY 6,406M (+307M period-on-period); FFO: JPY 6,517M (+72M period-on-period); operating revenue: JPY 11,933M (+2.4% YoY).

• NOI yield: 6.4%; NOI yield after depreciation: 5.0%.

• NAV per unit: JPY 108,138; net assets per unit: JPY 51,338.

• LTV (appraisal value): 29.0%; LTV (total assets): 44.2%.

• Average occupancy rate during FP 2026/1: 98.4%; period-end occupancy: 95.9%.

Outlook and guidance

• DPU forecast for FP 2026/7 and FP 2027/1: JPY 2,150, with FFOPU expected to reach JPY 2,440 in FP 2027/1.

• Guidance assumes new property acquisitions and dispositions, with continued focus on maintaining DPU above JPY 2,150 and annual FFO per unit growth of 2.2% or more.

• Re-leasing spread expected at +7.4% for FP 2026/7, maintaining momentum above target.

• Market recovery anticipated as vacancy rates have peaked and new supply is set to decline.

• Operating revenue for the six months ending July 2026 is forecast to decline 8.4% to JPY 10,934M, with net income expected to fall 14.8% to JPY 5,460M.