Shinko Real Estate Co., Ltd., a local company in Kobe, became a member of the Tokyo Century Group in July 2018 and will change its name to TC Shinko Real Estate in April 2022. We interviewed its president, Etsuro Fujino, who assumed his new position in April 2021, and asked how the company is engaging in a new type of real estate business as a comprehensive lifestyle-related company rooted in the local community and in the midst of transformation.
Covering All Areas of Real Estate as a Comprehensive Lifestyle-related Company
――First, could you tell us about Shinko Real Estate’s business?
Shinko Real Estate was established as the only comprehensive real estate company in the Kobe Steel Group, and it became a member of the Tokyo Century Group in 2018. We are currently positioned as a consolidated subsidiary of Tokyo Century Corporation and an equity method affiliate of Kobe Steel, Ltd. And we have formed a strategic alliance with Chuo-Nittochi Group Co., Ltd., a real estate operator like us.
Our five main areas of business include housing development, urban development, and insurance services as well as our subsidiaries’ building operation, management, and construction businesses. We operate a wide range of these businesses, mainly in the Osaka-Kobe area.
At the root of our corporate activities is our desire to continue to help enrich people’s lives. We define ourselves as a comprehensive lifestyle-related company and are constantly seeking products and services that can add value to our traditional real estate business, with an aim to become a “Smile Life Company” that brings dreams, hopes, and smiles to everyone.
――President Fujino, you were appointed as president in April 2021. How do you view the strengths of the organization?
I served as an outside director of Shinko Real Estate from 2018 and then as an executive deputy president before I was appointed as president. I now realize once again that high expectations from local residents are a major driving force for promoting our business.
For example, in Kobe, where we’re based, we have been entrusted with a number of large-scale development projects and the management of major facilities over the years. We are proud of our extensive track record, built up by our predecessors who cherished their ties with the local community since the company was founded half a century ago.
The immense trust in Kobe Steel, the KOBELCO brand, also provides a firm foundation for our business development.
From the very beginning of my tenure, I have been impressed by how our employees, who carry out their daily duties with a firm commitment, are very aware of their value to a company that bears the name of one of Japan’s leading corporate groups. This forms a solid basis of support for the peace of mind of our customers.
As for development projects, in many regards each of us is responsible from start to finish, starting with the raw land. In building management, we provide a comfortable environment through a wide range of services that include tenant management, cleaning, and security. And we are proud of the diverse skills we have accumulated in all areas of real estate.
Creating Synergies that Contribute to a Decarbonized Society in Developing New Businesses in Line with Current Trends
――How are synergies with the Tokyo Century Group impacting your business?
Three years have passed since we became a consolidated subsidiary, and we are now seeing synergies in the development of a new business—the development of logistic facilities. Demand for these facilities is rising in line with the recent rapid growth of the EC market. Several projects are already underway, including the construction of a new 10,000 m2 logistic facility in Suma Ward, Kobe City, which is scheduled for completion in 2022. Also, in Takatsuki City, Osaka, a large logistic facility of over 50,000 m2 is being developed on the site of a former warehouse of the Kobe Steel Group, which is scheduled to open in 2024.
Both facilities will have on-site PPAs with solar panels installed for self-sufficiency for electricity, which will also be supplied to other facilities. The plans have incorporated the expertise of Tokyo Century as one of the many renewable energy-related projects in which it is involved.
――Is the global trend toward a decarbonized society also being strongly reflected in the real estate market?
The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) formulated Real Estate Industry Vision 2030, which calls for the entire industry to provide real estate that excels in energy conservation and creation and for the building of a system that attracts medium- to long-term investment through a management policy that emphasizes ESG perspectives.
Over the past few years, a significantly increasing number of corporate customers have been using the rate of renewable energy use as a criterion for deciding whether to move into an office building.
Companies have provided information one after another as to their measures to reduce CO2 emissions. And I feel that the principle of competition suitable for the future is beginning to function soundly.
Creating properties that have less impact on the environment is also an important theme for Shinko Real Estate. In developing new properties, we will continue to exercise our ingenuity while fully applying the expertise and know-how of the Tokyo Century Group.
Changing the Company Name—A First Step Toward Our Goal of Ensuring that Every Employee Sees a Broader Spectrum of Possibilities
――The company name will be changed to TC Shinko Real Estate in April 2022. How will the name change affect the organization?
The Tokyo Century Group’s network and business promotion capabilities provide us with new possibilities as we aim to become a comprehensive lifestyle-related company that transcends the common sense of real estate.
We have established a foundation through collaboration with the Kobe Steel Group, and the Tokyo Century Group has been engaged in a wide variety of businesses in the global market. So, I can clearly foresee that if our foundation is successfully combined with the Tokyo Century Group’s organizational strengths, the examples I mentioned before, such as the on-site PPA, will be further developed and expanded in the future.
But to make such a prediction a reality, the most important prerequisite will be for each of us to realize that future. Frankly speaking, we haven’t had enough opportunities to do so.
I hope that the name change will foster a stronger sense of unity and be the first step in encouraging each employee to think freely with a broader perspective.
We would like to actively exchange human resources and information to stimulate each other and absorb the essence of Tokyo Century, with the aim of becoming a distinctive company that can demonstrate its unique individuality. It is my responsibility to take the helm at the beginning of TC Real Estate’s history.
――How did those around you react to the new company name?
We officially decided and announced the name TC Shinko Real Estate in September 2021. We informed the executives and employees of each group company and decided on the logo, so I now feel rather relieved. In selecting the logo, we conducted an internal questionnaire survey and reflected the opinions of executives and other employees. Also, our staff took the time to check the logo for various cases.
With the name change and its bearing “TC,” we are renewing our commitment to improving the recognition of Tokyo Century itself in the Kansai region and further promoting cooperation with the Group’s various services and businesses.
Within the company, there is momentum to break away from the conventional real estate business and try to do what we have not been able to do before. We would like to create a new kind of real estate company by trying things out and taking action, rather than just having discussions at the table.
――In the midst of major changes, it’s very important to work together with employees. How do you usually communicate with them? You have experience in various companies, so could you also tell us what you’re careful about in relation to the experiences you’ve gained through your career?
I make an effort to listen to employees as carefully as possible and speak honestly. I don’t care much for merely being considerate of other people’s feelings—a hot topic in the past for typical Japanese organizations. Doing so conceals one’s own true feelings and leads to misunderstandings, which eventually causes friction and other problems.
One of my most memorable career experiences occurred when I was young and my superiors and senior colleagues were very strict and tough on us. This was of course painful, but as I gradually began to have subordinates, I came to realize that this was the opposite of what was expected of me and that it would be the end if they stopped getting angry with me. Avoiding serious conversations, for example, if you don’t get angry it would be physically easier, but I also feel that it just keeps a lid on the issues in the long run. From this experience, I believe that it’s important to make sure that your subordinates know exactly what you’re concerned about and what the problem is. So, I sometimes try to show anger in a little exaggerating and courageous way, using my physical and mental energy. However, what’s important is not to be strict with the person, but with the quality of their job in order for him or her to do a better job. When you’re in a higher position, it’s difficult to get people to say what they really think. In any case, I’d like to create an atmosphere where our employees can feel free to talk seriously and work earnestly. Don’t get me wrong—I’m not always strict and angry (laughs).
Proudly Continuing to Respond to the Voices of the Community to Support the Future of Children and a Comfortable Society
――Shinko Real Estate is engaged in various activities as a company rooted in the local community. What are your thoughts on coexistence with the local community?
When I visited several municipalities in Hyogo Prefecture to introduce myself upon taking office, I received many words of expectation.
Although Hyogo Prefecture is home to Kobe and other major cities, there are areas in danger of depopulation. The people I met there expressed a sense of crisis about how to revitalize their towns, where the numbers of people are dwindling, and showed their willingness to work with the public and private sectors. Every time I spoke with them, I could sense the great role that’s expected of real estate operators in town development.
In addition, real estate is not a business that’s complete after development; it’s a business that needs to be managed so people can live safely and with peace of mind. This requires maintenance and redevelopment after a certain period, which is closely connected to people’s lives and lifestyles. Shinko Real Estate has therefore been carrying out activities to contribute to the local community in order to protect the future of children and the community so everyone can live in peace.
One such activity is a painting contest for elementary school children. All the preparations and management are done by our employees. The theme of the contest is “towns,” which relates to our business, and the entries are all wonderful and worthy of my respect. Their sensitive use of colors and imaginative worldviews have awed and encouraged many of our employees. We just finished the screening process the other day, and the works will be exhibited at the prefectural art museum early next year, and we’ll hold an award ceremony as well. The number of entries has increased every year, reaching about 2,000 this year, and the network of sponsoring companies, including the local board of education, is expanding.
Staying closer than ever to the people of the community, we will continue to serve steadfastly as a comprehensive lifestyle-related company.
President & CEO
Joined The Dai-Ichi Kangyo Bank, Limited (currently Mizuho Financial Group), where he was appointed as director of Shinko Real Estate in 2018 and executive deputy president in 2021. Born in Fukuoka Prefecture.
Mar 16, 2022 update
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