Japan Real Estate Investment To Buy Building For Record Y81.5bn

This purchase of a half-completed building will instantly account for 20% of JRE's total assets. While construction risk is probably minimal, I wonder if this makes sense from a seismic risk diversification point of view?

Japan Real Estate Investment To Buy Building For Record Y81.5bn
2005/08/30, The Nihon Keizai Shimbun, page 0, 228 words

TOKYO (Nikkei)--Japan Real Estate Investment Corp. (8952) will acquire the redevelopment building under construction on the lot formerly occupied by Nippon Credit Bank's headquarters for 81.5 billion yen, marking the most expensive individual purchase by a real estate investment trust.
With real estate holdings exceeding 3 trillion yen, REITs are increasingly seen as mainstream property holders on a par with financial institutions and business enterprises. But amid declining returns, some say the market is overheating.
The purchased building will have 26 floors and two basement levels, with a total floor space of nearly 59,000 sq. meters. It is slated for completion in January. In addition to office space, it will feature stores and 120 residential rental units. Fast Retailing Co. (9983), the operator of Uniqlo casual wear stores, is expected to be a tenant, and Banyu Pharmaceutical Co. plans to move its headquarters there.
Several real estate developers have taken part in developing the lot after purchasing it from the Resolution and Collection Corp. Japan Real Estate Investment, a Mitsubishi Estate Co. (8802) affiliate, bid for and gained preferential negotiating rights to the property. The parties are expected to sign a purchase agreement Wednesday.
To raise the necessary funds for the acquisition, Japan Real Estate Investment plans to issue publicly placed 20-year corporate bonds -- reportedly the first by a REIT.
(The Nihon Keizai Shimbun Tuesday morning edition)