"Sumitomo Real Estate Sales Group at a Glance Business Overview"
Sumitomo Real Estate Sales Group at a Glance Business Overview Revenue from Operations (Note)/ Operating Income (Fiscal 2008) The brokerage business constitutes a major pillar of our Brokerage Group’s activities. It offers brokerage services to cus- tomers who are buying and selling real estate, with a fo- cus on existing condominiums and single-family hous- es. Our “Property Listing First” (Butsumoto Shugi) policy is a key characteristic of our brokerage business and offers a large number of properties for sale. It en- sures that we can provide a prompt and accurate re- Revenue sponse to our customers’ diverse needs. from Operations 74.3% We sell entrusted properties such as new condominium Revenue from Operations Consigment units and single-family houses on behalf of our clients. Such consigned properties are sourced from a wide 9.9% Sales range of enterprises. Sumitomo Realty & Development Co., Ltd., the 8th largest supplier of new condominiums Operating Income in Japan in 2007, is the main consignor to this business. 5.4% We own and lease office buildings and condominiums Revenue from Operations Property which are located within the central business district and the densely populated Tokyo Metropolitan Area. 3.5% Leasing The property leasing business is less prone to seasonal fluctuations, which allows us to maintain steady reve- Operating Income nues from operations. 6.6% Our subsidiary enterprises, Well Yokohama Co., Ltd. and Revenue from Operations Sales Step Investment Co., Ltd. operate in real estate sales businesses such as the sale of newly developed housing, 11.2% the upgrading of existing properties, and sales of land. Operating We also utilize our directly-managed brokerage office Income network to secure ongoing procurement and sales of 1.8% properties. In addition to the 4 business types outlined above, we Revenue from Operations Others also provide support services for administrative activi- ties related to mortgages and loans for real estate trans- 1.1% actions. Operating Income 1.4% Note: Revenue breakdown by business segment is calculated using revenue from operations excluding intersegment transactions of our consolidated group. 10 Sumitomo Real Estate Sales Co., Ltd. Revenue from Operations and Subsidiary and Affiliates, Operating Income Margin Number of Offices, Positioning and Strategy Revenue from Operations Operating Income Margin Assets, Number of Employees (Millions of Yen) (%) Subsidiary: Our retail business accounts for approximately 90% of the 60,000 51,932 52,904 60 Sumitomo Real Estate Sales overall brokerage business. We directly own and manage all 44,717 (N.Y.), Inc. of our retail business offices, which provide nationwide high- 36,104 39,921 Number of Brokerage Offices: quality services to our customers. We continue to position the 40,000 35.5 37.8 36.3 40 238 retail business as the main driver for the further growth of 32.3 28.8 Assets: the Group and we plan to expand our operations accordingly. 20,000 20 ¥10.6 billion In our wholesale business we will strive for further growth Number of Employees: through vigorous sales and marketing campaigns, and also 2,281 via the acquisition of consignment arrangements for real es- 0 2004 2005 2006 2007 2008 0 tate sales from public agencies. (Millions of Yen) (%) Subsidiaries: As a great amount of replacement demand arises from our 8,000 7,120 40 Step Associates Co, Ltd. consignment sales, we achieve significant synergies with 6,465 6,459 6,454 Sumitomo Real Estate Sales our brokerage business. 5,423 6,000 30 (N.Y.), Inc. Our business strategy is to improve profitability by en- Assets: hancing the quality of our consignment sales properties, 4,000 18.1 17.9 18.8 17.3 20 ¥2.0 billion and to improve sales efficiency to cope with the uncertain Number of Employees: future prospects of the new condominium market. 2,000 9.0 10 434 0 2004 2005 2006 2007 2008 0 (Millions of Yen) (%) Subsidiary: We have secured a high operating income margin through Step Properties Co., Ltd. our efficient operations in the property leasing business. 3,000 2,613 2,439 2,556 2,633 75 2,399 Affiliate: We will continue to focus on maintaining and improving 56.8 Roppongi First Building the efficiency of operations by fully utilizing existing assets 2,000 48.5 49.6 55.3 50 Co., Ltd. to their maximum potential, rather than by expanding the 42.1 Assets: number of such assets. The brokerage and consignment 1,000 25 ¥55.2 billion sales divisions are the core components of our business and Number of Employees: we are therefore determined to concentrate our operating 10 resources in these areas. 0 2004 2005 2006 2007 2008 0 (Millions of Yen) (%) Subsidiaries: Our main concept in the sales business is to maximize syn- 10,000 8,798 20 Well Yokohama Co., Ltd. ergies with our brokerage business to more effectively con- 6,911 7,907 Step Investment Co., Ltd. tribute to the Group’s revenue growth. Unlike brokerage and 7,500 14.0 15 Assets: consignment sales, which are fee-based businesses, the 4,886 ¥5.6 billion sales business entails greater risks because the company 5,000 3,701 10.0 8.7 10 Number of Employees: holds the assets prior to sale. Therefore, we intend to main- 6.5 5.2 19 tain a steady pace of expansion rather than try to achieve 2,500 5 rapid growth of this business. 0 2004 2005 2006 2007 2008 0 (Millions of Yen) (%) Subsidiary: This additional business supplements our main real estate- 1,250 1,136 100 Step Loan Partners Co., Ltd. related activities. We will aim to further strengthen collabo- 926 951 Assets: ration within the Group, to ensure the stable growth of the 1,000 888 80 ¥6.9 billion existing businesses. 54.8 746 750 45.9 60 Number of Employees: 47.4 64.4 42.1 33 500 40 250 20 0 2004 2005 2006 2007 2008 0 Sumitomo Real Estate Sales Co., Ltd. 11