This move will see the operator expand its brand into residential and commercial property leasing in bid to combat financial pandemic woes
Okura Holdings has just announced that they have reached an agreement with Nagasaki to purchase a residential and commercial building via the Hong Kong Stock Exchange filing.
The Japanese pachinko hall operator is eyeing this business to diversify its income streams as the pandemic took a toll on its land-based income.
Back in May the Ministry of Economy, Trade and Industry disclosed the parlous' revenue of JPY66.58 billion (US$620.6 million) recording a 77.5% year-on-year decline.
Okura Holdings is well known in Japan for its presence in the pachinko industry. The company operates in Kyushu, Kanto, Kansai and Chugoku and has 17 pachinko halls in these regions around Japan.
The company said that the Group has been actively exploring opportunities to enhance and diversify its revenue stream.
“The Directors, taking into account various factors such as the location, condition and potential appreciation in value of the Properties, consider that the Acquisition provides an excellent opportunity for the Group to expand its property investment portfolio, which will allow the Group to benefit from any future capital appreciation, and generate a new source of rental income which can serve as the Group’s stable source of cash flow and revenue.”
The deal is priced at JPY442 million (US$4 million), with this price the company will be purchasing the land and building inside Nagasaki for the development.
In April last year, SiGMA News reported Pachinko Parlors resisting prefectural governors’ request to close these land-based venues in Japan.
Back then, both Minister Nishimura and Governor Ido threatened the non compliant pachinko parlors with the exercise of Article 45 of the Act on Special Measures Against New Influenza, allowing authorities to make public the names of business operators refusing to cooperate with efforts in order to protect public health during the emergency.
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