【JP:5532】Stock Price

Real Gate operates a flexible workplace business focused on small offices and shared offices. The company renovates older, small-scale buildings in central Tokyo into distinctive offices and resells them. Real Gate handles planning, design, construction, leasing, and operations as a one-stop service, increasing property value and generating rental and operational income.

The company's main customers are building owners and tenant companies. Tenants are primarily young information service firms leasing small offices under 50 square meters. Revenue is primarily recurring income from master leases and property management, accounting for approximately 60% of sales in the fiscal year ending September 2025. This is supplemented by flow-type income from design, construction, and property sales.

The business model consists of property management (outsourced operations), master leases (subleasing after bulk leasing), in-house design and construction, rental income from owned properties, and capital gains from selling renovated properties. Real Gate concentrates operations in preferred areas, primarily Shibuya, Minato, and Meguro wards. With a track record of 107 cumulative projects and 65 operating properties (approximately 39 master leases, 17 property management contracts, and 7 owned properties), the company pursues high occupancy rates and rental growth.

RealGate's core business is a flexible workspace operation that renovates aging small-scale buildings in urban centers to add value. The company aims to increase revenue and operating profit over the next three years. As of September 2025, RealGate operates approximately 104,253 square meters across 107 cumulative projects, with 65 properties currently in operation. The company has established a strong growth foundation with a monthly occupancy rate of approximately 98% and an average rental rate of approximately 26,000 yen per tsubo, demonstrating high occupancy and profitability.

Key investment priorities include strengthening in-house expertise across planning, design, construction, leasing, and operations, and pursuing a dominant strategy concentrated in central Tokyo's narrow zones (Shibuya, Minato, and Meguro wards). The company combines stable recurring revenue from master lease agreements and property management contracts with flow-based revenue from design and construction services to expand earnings. Specific initiatives include increasing brand awareness among building owners and strengthening relationships through property viewings to secure more high-quality properties.

For business expansion, the company prioritizes increasing property numbers within its core areas while broadening market reach by accommodating conversion needs for hotels, commercial facilities, and residential uses. On the funding side, the company actively leverages bank loans while strengthening relationships with the CyberAgent Group and leveraging enhanced creditworthiness from a potential public listing. It pursues growth through a combination of equity and external financing to expand business scale, including property ownership.

On the technology and environmental front, in-house capabilities enable rapid renovations with a competitive advantage of six months to one year to completion, while strengthening environmental initiatives such as obtaining DBJ Green Building certification. Additionally, the company monitors key metrics including occupancy rates, average rents, and operating area to respond quickly to demand changes and incorporate findings into design and operations, which represents a core competitive advantage.