HEIWA REAL ESTATE CO.,LTD.
8803・Prime Market・Real Estate
Business
Heiwa Real Estate is a real estate company established in 1947 following the dissolution of the Japan Securities Exchange. It consists of two segments: the Building Business, which develops, leases, manages, and sells securities exchanges, offices, commercial facilities, residences, and other properties; and the Asset Management Business, which handles asset management for Heiwa Real Estate REIT, Inc. (HFR) and Real Estate Brokerage Services. The company is advancing redevelopment centered on the Nihonbashi Kabutocho and Kayabacho areas in central Tokyo, while also expanding into major cities nationwide, including Sapporo. Through capital and business alliances with Mitsubishi Estate and Taisei Corporation, the company aims to accelerate its Redevelopment Business and expand into new business areas.
Business Model
Leasing revenue (¥28,932 million in FY2026 (ending March 2026)) serves as a stable earnings base, while property sales income from portfolio rebalancing (¥15,675 million for the same period) drives capital turnover. In addition, the Asset Management Business—comprising HFR's asset management fees (¥3,152 million) and brokerage commissions (¥1,466 million)—complements this with a high operating margin of 59.3%. This three-layer structure of leasing, sales, and fees achieves both resilience to market fluctuations and sustained growth.
Company Strengths
Since its establishment in 1947, the company has a track record of owning and operating scarce locations in central Tokyo, centered on the Tokyo Stock Exchange building. Through developments such as KABUTO ONE (opened 2021) and Caption by Hyatt Kabutocho Tokyo (opening October 2025), it has led the branding of the Nihonbashi Kabutocho and Kayabacho area. The low vacancy rate of 2.27% demonstrates the strength of its locational competitiveness.
HFR's asset management is conducted through Heiwa Real Estate Asset Management Co., Ltd., and the Asset Management Business's operating margin reached 59.3% in FY2026 (ending March 2026). AM fees grew 13.3% year on year to ¥3,152 million, and brokerage commissions also grew 13.1% to ¥1,466 million, expanding on both fronts to serve as a high-ROE revenue source that requires almost no use of shareholders' equity.
The company has collaborated with Mitsubishi Estate since 2011 on the redevelopment of Nihonbashi Kabutocho and Kayabacho, and concluded a capital and business alliance with Taisei Corporation in June 2024. Taisei Corporation holds the right to nominate a candidate for the executive officer in charge of the Redevelopment Business, establishing a framework that leverages the expertise of a super general contractor to advance redevelopment. Through this three-party agreement, the company aims to accelerate redevelopment and expand into new business areas.
ENVALITH's Perspective
Performance Trend
Revenue increased sharply by 20.9% from ¥42,075 million in FY2025 (ended March 2025) to ¥50,855 million in FY2026 (ending March 2026), significantly accelerating. The main driver was a 74.8% increase in property sales revenue, from ¥8,965 million to ¥15,675 million, while leasing revenue also expanded steadily to ¥28,932 million (up 5.1% year on year). Operating profit reached ¥15,109 million (up 14.5% year on year), and net income attributable to owners of parent reached ¥11,032 million (up 15.3%), both marking the highest levels in the past five fiscal years. Externally, continued expansion demand in the Tokyo office market and rising average rents underpinned leasing revenue, while robust investment appetite in the real estate investment market supported the realization of property sales. On the other hand, an increase in interest expenses (¥2,510 million) caused the growth in recurring profit to fall short of operating profit growth (up 11.4%). For FY2027 (ending March 2027), the company forecasts revenue of ¥63,800 million and operating profit of ¥15,800 million.
Growth Strategy
Under WAY 2040 Stage 1, the company aims to enhance corporate value through the expansion of its redevelopment business, growth of its Asset Management Business, and improved capital efficiency
Payments of contributions as a participating member in the Sapporo redevelopment project are progressing. In the Kabuto-cho area, Caption by Hyatt Kabutocho Tokyo opened in FY2026 (ending March 2026) and has begun contributing to earnings. The enhancement of the sales pipeline through the transfer of assets from fixed assets to real estate for sale (¥25,116 million in the current fiscal year) supports the plan for property sales revenue of ¥26,400 million in FY2027 (ending March 2027).
Two hotels, Caption by Hyatt Kabutocho Tokyo (Chuo-ku, Tokyo) and Mercure Tokyo Hibiya (Chiyoda-ku, Tokyo), opened and began contributing to earnings during the current fiscal year. Through the consolidation of Tokyo Hibiya Hotel and Tokyo Nihonbashi Kabutocho Hotel as subsidiaries, these hotels are beginning to function as a source of earnings that captures growing inbound demand.
The company expanded its unit holdings in Heiwa Real Estate REIT to 165,479 units (market value of ¥23,630 million), strengthening the profit-sharing structure. Asset management revenue reached ¥3,152 million, up 13.3% year on year. For FY2027 (ending March 2027), the company plans ¥3,400 million (up 7.9% year on year), aiming to sustain growth as a high-margin segment.
The company has set a consolidated dividend payout ratio of 50% as its shareholder return policy for FY2024 through FY2026. In FY2026 (ending March 2026), it implemented an annual dividend of ¥98 per share (payout ratio of 59.2%), achieving nine consecutive years of dividend increases since FY2017 (ending March 2017). The company also conducted share buybacks (¥1,756 million in the current fiscal year), and plans an annual dividend of ¥103 per share in FY2027 (ending March 2027), marking ten consecutive years of dividend increases.
Last updated: July 19, 2026