Chuo Mitsui Trust & Banking Co. and the Japan unit of Creative Renovation Group, a Canadian hotel consulting firm, will set up an investment trust next summer to invest exclusively in hotels, company officials said Monday.
The hotel investment trust, the first of its kind in Japan, will start out with about 40 billion yen worth of funds and is expected to be listed on the Tokyo Stock Exchange in autumn 2005, the officials said.
Chuo Mitsui and Creative Renovation Group Japan Inc. plan to increase the funds to 100 billion yen in three years, aiming to achieve an annual return of 5 percent to 6 percent, they said.
The establishment of the investment trust is aimed at cashing in on expected sales of hotels following the mandatory introduction of asset-impairment accounting standards in Japan in fiscal 2005, they said.
Under asset-impairment accounting standards, firms will be required to book valuation losses on fixed assets whose market values drop sharply from their book values.