japan reit market hits 8 month high

I dont hold BJT but the following article may be relevant to you guys :-)

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Japan REIT market hits 8-mth high, more gains seen
Mon Jun 29, 2009 4:22am EDT Email | Print | Share| Reprints | Single Page[-] Text [+]

http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUST36420220090629

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More Business & Investing News... TOKYO, June 29 (Reuters) - Japan's real estate investment trust market climbed to an eight-month high on Monday as investors grew more optimistic about the sector's financial health and analysts forecast more upside ahead.

Along with property stocks, Japan's REIT market was hit hard as the global financial crisis pushed down property values and squeezed financing, driving investors out of the market.

But an increasing number of investors are returning to the REIT market after media reported that Japan plans to set up a $10 billion fund to buy properties held by REITs and make loans to the trusts, analysts said. [ID:nT62895]

Investors were also cheered by news that Daiwa Securities Group (8601.T), Japan's No.2 brokerage, plans to spend about $140 million to take a stake in DA Office Investment Corp (8976.T), a REIT which mainly invests in office buildings. Daiwa will also buy DaVinci Select, the firm that manages the REIT. [ID:nT58298]

Such news has helped restore confidence in the outlook for the REIT market, which despite its recent roll is still down nearly two-thirds since hitting a peak about two years ago.

"A series of support for the REIT and property market, like the setting-up of a fund and emergency package for smaller firms, has begun boosting investor sentiment ... the REIT market has already hit a recent bottom," said Kabu.com strategist Tatsunori Kawai.

"The REITs are still looking cheap considering their valuations," Kawai said, adding that the index still has more upside potential.

The Tokyo Stock Exchange's REIT subindex .TREIT rose 0.6 percent to 976.07 on Monday, its highest level since Oct. 6, and bucking the benchmark Nikkei index's .N225 1 percent fall.

The index has also regained the level seen before New City Residence Investment Corp in early October became Japan's first REIT to fold, spooking the market as investors expected more failures amid the global credit crunch.

But the REIT subindex is still down about 63 percent since hitting a peak in May 2007.

On Monday, Nippon Building Fund Inc (8951.T), the biggest Japanese REIT among 41 listed REITs, rose 2.4 percent and Japan Real Estate Investment Corp (8952.T) climbed 3.2 percent.

"Easing credit concerns, an expected industry shake-up following Daiwa's entry ... the market is seeing a series of good news," said Takahiko Kishi, a senior analyst at Mizuho Investors Securities.

Kishi added that the REIT market might find more impetus if investors see a further shake-up in the market, with big companies taking over or investing in smaller REITs that are having trouble raising funds.

Mitsubishi Estate (8802.T), Japan's second-biggest developer, is interested in buying a REIT in Japan while preparing to launch a property investment fund in the United States, its president told Reuters in a recent interview. [ID:nSP466298]

Orix Real Estate Corp, a wholly owned unit of Orix Corp (8591.T), has said that it might launch a new REIT when the market recovers. [ID:nT98786] (Reporting by Mariko Katsumura; Editing by Chris Gallagher)