currency hedge

Hedging cash flow so far into the future has made GJT essentially a forex play, A$ v the yen, with the property investment secondary. If yen earnings are to be retained to repay yen borrowings, does it make sense to hedge them into A$? Is it necessary to hedge future distributions which may not be made, especially if there is a forced break up of the company?

If it is possible to lock into the current exchange rate, by taking off the hedges, there is a definite and significant upside for shareholders in reducing loan exposure and an orderly realisation of assets. The u/r exchange losses will be realised, but so what.

Unfortunately, yen appreciation and declining Japanese real estate values are correlated, so if sentiment deteriorates GJT net asset value will take a double hit. Ironically the hedges are increasing risk, rather than reducing it.