Azplanning Co.,Ltd.

Business Details

The company acquires used real estate with declining occupancy rates and rent levels, enhances earning power through renovation (interior work involving layout changes) and leasing (tenant solicitation activities), and then sells the properties to real estate investors. Operations are centered on central Tokyo and span the greater Tokyo area (Tokyo and three neighboring prefectures), handling diverse property types including residences, offices, buildings, and sectioned condominiums. Income Real Estate Sales accounts for the majority of revenue, making this the core segment representing approximately 94.9% of the group's total revenue.

Recent Overview

Q1 revenue increased 115.2% year-on-year, with segment profit up 177.2%, representing significant growth in both revenue and profit

In Q1 of FY2027 (ending February 2027) (March to May 2026), the company sold a total of 5 properties (2 buildings, 2 sectioned offices, 1 residential building), achieving segment revenue of ¥4,200 million (up 115.2% year-on-year) and segment profit of ¥564 million (up 177.2% year-on-year). The balance of real estate for sale rose to a high level of ¥8,028 million, and real estate for sale in progress reached ¥2,518 million, with progress toward the full-year earnings forecast (revenue of ¥15,500 million) proceeding smoothly. Sourcing activities for sectioned condominiums, including premium condominiums, are also being actively pursued.

Key Products

Growth Drivers

• Accumulation of a high level of real estate for sale inventory (¥8,028 million for sale plus ¥2,518 million in progress), securing sales capacity from FY2027 (ending February 2027) onward
• Increase in average sale price per unit through larger and more diverse property handling (buildings, sectioned offices, premium condominiums, etc.)
• Robust real estate investment demand centered on central Tokyo and rising attention to used income real estate (relative yield advantage against the backdrop of soaring new-construction prices)
• Issuance of the 7th to 9th series stock acquisition rights (estimated net proceeds of ¥1,279 million), securing ¥979 million for sourcing funds and ¥300 million for growth investment funds for M&A and strategic alliances
• Strengthened collaboration with the Real Estate Management Business through the acquisition of Fuji Home Co., Ltd. (increase in management contracts after sales)

Risks

• Profit pressure from rising borrowing costs due to policy interest rate hikes (interest expense: ¥69 million in Q1 of FY2027 ending February 2027, up ¥47 million year-on-year)
• Risk of rising sourcing costs and declining profit margins due to persistently high real estate prices and intensifying sourcing competition among peers
• Risk of prolonged inventory holding of real estate for sale (increase in inventory pushing up financial leverage, with the equity ratio declining from 27.5% to 24.3%)
• Risk of rising renovation costs due to soaring construction material prices and labor costs, worsening profitability of development projects
• Dilution risk from exercise of stock acquisition rights (7th to 9th series, 375,000 potential shares) (equivalent to approximately 24.9% of the current outstanding share count of 1,508,000 shares)
• Risk of revenue concentration among key customers (due to the nature of buy-and-resell business, dependence on specific investors may increase)