Real estate crowd-funding platform SYLA reports first half results

Nasdaq-listed SYLA Technologies, operator of the largest membership real estate crowd-funding platform in Japan, Rimawari-kun, reported its interim financial results for the six months ended June 30, 2024.

SYLA achieved a 13% revenue increase for the first half of 2024 compared to the same period in 2023, and anticipates the completion of nine new projects in the second half of 2024, which will boost gross profit.

SYLA’s stock price since listing on Nasdaq in 2023

Operational Highlights to Date in 2024

• Entered into a capital and business alliance agreement with CUMICA CORPORATION (formerly RIBERESUTE CORPORATION) and became the largest shareholder.
• Subscribed to a third-party allotment of new shares issued by CUMICA CORPORATION (formerly RIBERESUTE CORPORATION).
• Announced mid-term revenue targets and a growth strategy centered on M&A.
• Announced an interim dividend of ¥100 per share (1 share = 100 ADRs).
• Announced the development of an ultra-luxurious residence, THE SYLA SHIBUYA-TOMIGAYA.
• Completed construction of the Company’s first office building, SYLA TOYOCHO.
• Announced a ¥96 million gain on sale of investment securities.
• The membership of an online AI rental brokerage service, ietty, surpassed 400,000.
• The average occupancy rate for the SYFORME series of original brand condominiums in the first half of 2024 was 99.80%.
• Rimawari-kun’s gross merchandise volume (total amount raised by Rimawari-kun) surpassed ¥7.5 billion.
• Subsidiary SYLA Solar announced issuance of series 1 bond of ¥50 million.
• Subsidiary SYLA Solar announced a comprehensive business alliance with LIVE THE CREATIVE Inc.
• Subsidiary SYLA Solar announced a business alliance with ABILITY LTD., a supplier of hydrogen cartridges.
• Subsidiary SYLA Solar launched on-site PPA business.

First-Half 2024 Financial Results

Results compare the six months ended June 30, 2024, to the six months ended June 30, 2023, unless otherwise indicated. Results below are for SYLA Technologies on a consolidated basis.

• Total revenues for the six months ended June 30, 2024, increased to $65.7 million from $57.9 million for the six months ended June 30, 2023. The increase was attributable to an increase of $28.6 million in real estate sales, with 162 units sold during the six months ended June 30, 2024, compared to 110 units during the six months ended June 30, 2023, as well as the sales of two entire buildings. On the other hand, sales of large-scale development sites decreased by $21.9 million.
  In the renewable energy sector, solar power plant sales increased by $1.9 million. On July 1, 2024, SYLA Solar absorbed renewable data center company SYLA Biotech to further grow its business and enhance corporate value by leveraging internal resources and sales channels.
• Gross profit decreased to $12.1 million for the six months ended June 30, 2024, from $14.6 million for the six months ended June 30, 2023. Despite an increase in the number of units and buildings sold, this was offset by a decline in large-scale development site sales that reduced gross profit.
• Total operating expenses decreased to $10.9 million for the six months ended June 30, 2024, from $11.8 million for the six months ended June 30, 2023. The decrease mainly consists of a $1.8 million decrease in legal and professional expenses and consulting fees including the costs for the IPO on NASDAQ as well as listing maintenance costs, including audit expenses and legal fees for compliance with disclosure requirements and related matters. This decrease is offset by an increase of $0.5 million in personnel expenses due to hiring for future business expansion.
• Net loss attributable to SYLA Technologies $0.4 million ($1.59 per basic and diluted share) for the six months ended June 30, 2024, compared to net income attributable to SYLA Technologies of $1.6 million ($6.23 per basic share and $5.18 per diluted share for the six months ended June 30, 2023.
  Despite an increase of $0.6 million in gains from the sale of investment securities classified as other income, the net income decreased due to higher interest expenses resulting from increased borrowings for real estate development expenditures and investments aimed at business expansion.
• As of June 30, 2024, SYLA Technologies $14.8 million in cash and cash equivalents.

Please follow us to read more about Finance & FinTech in Japan, like hundreds of readers do every day. We invite you to also register for our short weekly digest, the “Japan FinTech Observer”, on Medium or on LinkedIn.

We also provide a daily short-form Japan FinTech Observer news podcast, available via its Podcast Page. Our global Finance & FinTech Podcast, “eXponential Finance” is available through its own LinkedIn newsletter, or via its Podcast Page.

Should you live in Tokyo, or just pass through, please also join our meetup. In any case, our YouTube channel and LinkedIn page are there for you as well.