Forval RealStraight Inc.

Business Details

The company operates the Solutions Business, providing comprehensive support for corporate clients' office relocation needs, ranging from real estate brokerage to interior construction, various infrastructure setup, and arrangement of office equipment and furnishings. Its primary market is the five central wards of Tokyo (Chiyoda, Chuo, Minato, Shinjuku, and Shibuya), with small and medium-sized enterprises as its main customer base. For FY2026 (ending March 2026, consolidated), the company recorded net sales of ¥6,254 million and operating profit of ¥194 million, achieving substantial year-on-year growth in both revenue and profit.

Recent Overview

Full-year FY2026 (ending March 2026) results showed higher revenue and profit; ROE finalized at 24.4% following correction

For FY2026 (ending March 2026, consolidated), the company recorded net sales of ¥6,254 million, operating profit of ¥194 million, and an operating margin of 3.1%. Following a corrective disclosure dated June 25, 2026, Return on Equity (ROE) was revised from the originally announced 45.4% to 24.4%. In the statement of cash flows, gain/loss on sale of investment securities (from ¥-59,236 thousand to ¥-58,351 thousand) and other items (from ¥15,616 thousand to ¥14,732 thousand) were also corrected; however, total cash flows from operating activities (¥194,907 thousand) remained unchanged, and the impact on actual business performance was minor.

Key Products

Growth Drivers

• Expanding relocation demand driven by declining vacancy rates and rising rents in the office market in Tokyo's five central wards (average vacancy rate of 2.22% as of end-December 2025, down 1.78 percentage points year on year)
• Sales growth driven by an increase in contracts signed for interior construction and related services (up 4.2% year on year for FY2025 ending March 2025)
• Rising demand from companies for investment in office environments aimed at talent acquisition, retention, and productivity improvement
• One-stop proposal capability backed by specialized teams in real estate, project management, interior design, furnishings, and ICT
• Development of new revenue sources through Value-Up Solutions for Building Owners
• Expansion of business scale through the newly consolidated Daiichi Kogeisha Co., Ltd.

Risks

• Risk of an increasingly skewed revenue structure due to the declining trend in real estate brokerage sales (down 17.5% year on year in FY2025 ending March 2025)
• Downward trend in per-customer unit prices for interior construction (offset by an increase in contract volume, but unit prices are declining)
• Risk of reduced relocation demand due to fluctuations in supply and demand in the Tokyo central office market (rising vacancy rates and falling rents)
• Risk of revenue concentration among key customers (Sharp Finance Corporation 11.5%, YF Capital Japan Corporation 10.3%)
• Risk of rising SG&A expenses due to increased recruitment and training costs
• Risk of reduced office investment due to economic deterioration stemming from geopolitical risks and trade policy impacts
• Risk of profit compression during periods of rising costs, given the low operating margin of 3.1%