Sumitomo Realty Profit Rises on Leasing, Housing Businesses

Sumitomo Realty & Development Co. (8830), Japan’s third-biggest developer, said full-year net income rose 4.6 percent helped by profit improvements at its office leasing and housing businesses.

Net income gained to 53.2 billion yen ($665 million) in the 12 months ended March 31 from 50.9 billion yen a year earlier, the Tokyo-based company said in a statement to the Tokyo Stock Exchange today. Sales fell 7.5 percent to 688.7 billion yen.

Operating profit at the leasing business, which accounts for more than half of the total, rose 1.6 percent to 89.6 billion yen after the developer’s vacancy rate fell from the highest since at least 2005 during the period. The vacancy rate of Sumitomo Realty’s building portfolio dropped to 7.8 percent as of March 31 from 8.2 percent a year earlier.

Sumitomo Realty forecast net income for the year ending March 31, 2013 will gain 8.9 percent to 58 billion yen. Sales will rise 4.6 percent to 720 billion yen in the current fiscal year, according to the statement.

Sumitomo Realty’s shares rose 0.8 percent to 1,750 yen at the close of trading on the Tokyo Stock Exchange. The stock has advanced 30 percent this year.

Operating profit for the company’s home sales business rose 13 percent last fiscal year as demand and low interest rates supported the condominium market, the company said.

To contact the reporter on this story: Kathleen Chu in Tokyo at Kchu2@bloomberg.net

To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net

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