of SIB in Japan to date, but there is some movement towards implementation. In cooperation with the pilot business which the Japan Foundation (public finance) is starting in order to introduce SIB, Yokosuka City of Kanagawa Prefecture began a promotion program for special adoptions Note $ ^{41} $ in April 2015.

The specific business plan is for an intermediary support organization (in this instance the Japan Foundation) receiving funding from the Japan Foundation will subcontract the business to a public organization, and the public organization which took on the consignment will cooperate with the city to implement a program to promote the successful conclusions of special adoption processes (Figure 2-1-105). The results of successfully concluding special adoptions include not only an improvement of a child’s home care environment at early stages, but reduction in facility management costs are predicted from the decrease in the number of entrants into infant homes/orphanages within the city and these results will be evaluated. Yokosuka City will consider the results from this business and, if the business is evaluated as successful, plans to implement an SIB in FY2016 to establish the business as a city function.

In this way, because the compensation amount to the investors in a SIB—in other words, the amount of returns paid by the government—will be determined in alignment with the social performance of the business, it will be important to determine if the social performance can be calculated in a quantitative and objective way. If such an evaluation model can be established for the social businesses in various fields, new investment proposals for social businesses can be created, and it can be anticipated that even as the government’s budget becomes more limited, solutions to social problems can be found and the financial burden can be lightened.

### d. Investment that Use the District’s Real Estate

Investments that make use of real estate in the district has been suggested as an improvement measure which focuses on the “Stock” aspect of the district for the economic circulation structure of the local district.

The general flow for reinvestment with regards to the local district economic circulation involves capital investment by businesses leading to production of new goods and services. On the other hand, with investments that maximizes on the real estate existing in the district, there is a possibility of creating a new fund circulation that differs from the one mentioned above.

Looking at the real estate held by the household category of Japan according to the National Accounts, land is approximately JPY 676 trillion, residence is up to approximately JPY 303 trillion and—the major portion of household financial assets—cash/saving balance is at a level over approximately JPY 874 trillion (Figure 2-1-106).

In this way, Japan has large-scale real estate holdings, but for many properties the benefits that can be gained from them are decreasing as a result of declining use and dilapidation. There are also cases of real estate property with a certain economic value not being used effectively, which means its full value is not being realized.

Therefore, investments that make effective use of such real estate in the district can be one method of revitalizing the economic circulation of the district. The main examples of such investment can be divided into the following categories: those with the purpose of “Improving the Real Estate Value” and those with the purpose of “Converting Real Estate to Funds” (Figure 2-1-107). Currently the method of converting real estate to funds—such as reverse mortgage and real estate securitization—is mostly used in the Tokyo Metropolitan Area and has not spread to the Rural Areas, but efforts are being made to promote the use of this method in the rural cities.