2025-06-09-花旗集团-住友不动产（8830）_住友不动产（8830.T）_艾略特发布公开信反对高层管理人员连任_11页_382kb

Elliott Investment Management released an open letter on June 8, 2025, urging shareholders to oppose the reappointment of senior management at Sumitomo Realty & Development (8830.T) at the 2025 AGM. As a major shareholder holding over 3% of the stock, Elliott appreciates the company's efforts but criticizes weak shareholder returns, excessive cross-shareholdings, declining capital efficiency, and poor corporate governance. Key demands include raising the total payout ratio to 50% or more, reducing cross-shareholdings to below 10% of net assets, setting an RoE target of at least 10%, and increasing the number of independent directors.

Citi Research views the news as moderately positive for Sumitomo Realty & Development and the broader real estate sector, noting similar discussions have occurred with capital market participants. Citi believes the firm has made progress on these issues, but sees a low probability of immediate action due to recent positive developments, such as a new medium-term plan and guidance. The management approval ratings were high at last year's AGM, and Citi recommends Mitsubishi Estate as a top pick with a target price of ¥3,250.

Valuation for Sumitomo Realty & Development sets a target price of ¥6,700 with a 21.8% expected return, citing risks like office leasing trends and interest rate changes. For Mitsubishi Estate, Citi sets a ¥3,250 target price. Both companies face market-related risks.

Elliott's letter is part of ongoing dialogue, and Citi highlights that no new demands were raised. Overall, pressure for improved shareholder returns and governance persists in the sector.