Collaborating in the creation of Japan’s first healthcare REIT

Rapidly rising social security costs are becoming an increasing burden on Japan’s financial system and despite the urgent need to respond to the nation’s aging population, there is a shortage of domestic funds being circulated to the healthcare industry. To improve the situation, in 2010 AIP began encouraging Japanese financial institutions and institutional investors to play a role to development the healthcare industry. Following the example of the growing market share of healthcare real estate investment trusts (REITs) in the United States, AIP sensed the need to create a market in Japan for REITs specializing in healthcare. AIP has participated in government committees to establish the market framework, presented in seminars, and actively promoted the market’s development.

Aware of the need to supply funds to the healthcare industry, AIP started preparations to establish a Japanese healthcare REIT in 2013 with the Daiwa Securities Group, who had made a commitment to increase investment in the healthcare industry. In December 2013, AIP entered into an advisory agreement with Daiwa Real Estate Asset Management Co. Ltd., the wholly-owned subsidiary of Daiwa Securities Group Inc. After starting operations as a private REIT in March 2014, Nippon Healthcare Investment Corporation, currently Daiwa Securities Living Investment Corporation, Japan’s first dedicated healthcare REIT, listed on the Tokyo Stock Exchange in November 2014.