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In general, fiscal 2001 marked an excellent year
for Kajima's overseas development business, although, by the end
of 2000, the United States started to show signs of economic slowdown
and its effects began to be felt around the globe.
Due to enhanced efforts to improve the profitability of projects
already in operation, coupled with the tailwinds of favorable
exchange rates, successful financial results were reported from
various Asian operations such as the Millenia in Singapore, a
mixed-use project featuring the Ritz-Carlton and the Conrad hotels,
and the Senayan commercial/residential complex in Indonesia. As
a reflection of exerted efforts to achieve timely turnover of
projects under development, the Stockley Park project in the United
Kingdom has become an important mainstay of income for the real
estate development business in Europe, while in the United States
the Company was able to generate stable returns for consecutive
years from the industrial real estate development undertaken by
Industrial Developments International, Inc. (IDI). In Hawaii,
Hualalai Resort also celebrated a successful year with a record
profit from residential sales and hotel/resort operations.
Kajima's current strategy for overseas real estate businesses
is two-fold. The strategy for facilities already in business (e.g.,
hotels, shopping centers, office buildings, serviced apartments
and others) is to maximize the operating income by improving the
management of the existing facilities, while the strategy for
new projects is to focus solely on those with a short-term turnover
cycle (e.g., IDI's industrial real estate development and the
new phases of the Stockley Park office development), thereby improving
the Company's overall cash flow.
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In the United Kingdom, the Company is currently
seeking early acquisition of planning permission to start construction
on the new Cambridge office for the Department for Environment,
Food and Rural Affairs (DEFRA), formerly known as MAFF. It is
the first private finance initiative (PFI) project in the United
Kingdom to be undertaken by a Japanese company solely on its own.
The One London Wall (an office building development with total
floor area of approximately 28,000 square meters), designed by
the internationally renowned architectural firm, Foster &
Partners, is a project in joint venture with Hammerson plc. in
the City of London. The joint venture will be granted a new 150-year
lease by the Corporation of London. With the demolition of the
existing structure commenced in the spring of 2001, construction
of the new building is due for completion in 2003.
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