Make The World
More Sustainable[Provisional Translation Only]
This English translation of the original Japanese document is provided solely for information purposes.
Should there be any discrepancies between this translation and the Japanese original, the latter shall prevail.

December 22, 2022
IssuerIchigo Hotel REIT Investment Corporation (“Ichigo Hotel,” 3463)
1-1-1 Uchisaiwaicho, Chiyoda-ku, Tokyo
Representative: Eriko Ishii, Executive Director
www.ichigo-hotel.co.jp/en
Asset Management Company
Ichigo Investment Advisors Co., Ltd.
Representative: Hiroshi Iwai, President
Inquiries: Hidehito Iwasaka, Head of Ichigo Hotel
Tel: +81-3-3502-4892
Earnings Forecast Revision for the January 2023 Fiscal Period
Ichigo Hotel is revising upward its January 2023 fiscal period earnings forecast announced
in the September 14, 2022 release “July 2022 Fiscal Period Earnings.”
1. January 2023 Earnings Forecast Revision(JPY million)
OperatingProfit

Recurring
Profit

1,205

514

283

282

1,106

1,323

597

374

373

1,465

+118

+83+91+91+359% Change+9.8%+16.2%+32.3%+32.4%+32.5%

Reference:January 2022

1,125472

274342

1,345Previous Forecast(A)New Forecast(B)Difference(B) - (A)Net
IncomeDividendper Share(JPY)

OperatingRevenue

Reference: Net Income per Share: JPY 1,465
Period-end number of shares outstanding: 254,974 shares
Note: The new forecast is based on the “Preconditions for the January 2023 Earnings
Forecast” on page 3. Actual results may vary due to changes in circumstances, so theseforecasts should not be construed as a guarantee of such results. Ichigo Hotel will make aforecast revision should a material discrepancy emerge between this forecast and results.

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2. January 2023 Earnings Forecast Revision Rationale
Ichigo Hotel is revising up its January 2023 fiscal period earnings forecast (announced onSeptember 14, 2022) on the back of domestic leisure and business demand recovering asa result of the lifting of Covid restrictions and a domestic travel subsidy program by thegovernment.
Ichigo Hotel expects to record greater than expected variable rent at the Valie Hotel
Hiroshima due to Hiroshima Prefecture temporarily leasing all rooms starting in midFebruary 2021 and at the Nest Hotel Kumamoto due to Kumamoto Prefecturetemporarily leasing all rooms starting on February 1, 2022. Both prefectures arecontinuing the temporary leasing of rooms.
As a result, the forecast for January 2023 operating revenue, operating profit, recurring
profit, net income, and dividend per share are expected to increase by JPY 118 million(+9.8%), JPY 83 million (+16.2%), JPY 91 million (+32.3%), JPY 91 million (+32.4%),
and JPY 359 (+32.5%) respectively, versus the previous forecast.
Business and leisure demand has been gradually recovering on the back of the lifting ofCovid restrictions, and Ichigo Hotel’s January 2023 RevPAR based on actual August toOctober 2022 results for its 15 variable rent hotels is JPY 5,387 (+93.5% YOY).
There is no revision to the July 2023 fiscal period earnings forecast.
Should any further change to the outlook for operating results arise, Ichigo Hotel willpromptly disclose the details.

2Preconditions for the January 2023 Earnings Forecast
Preconditions
PeriodNumber ofHotels

 August 1, 2022 to January 31, 2023 (184 days)
 25 hotels
Within operating revenue, rental income is forecast based on current lease contracts,
taking into consideration such factors as hotel and market conditions.1
Forecast Operating Performance2

3

Occupancy
ADR4

January 2023 Fiscal Period
82.4%
JPY 5,791

1OperatingRevenue

The forecast rental income assumes operators and tenants will fully pay theircontractual rents without delay or default.
2The 16 variable rent hotels are: Smile Hotel Kyoto Shijo, Nest Hotel Sapporo
Ekimae, The OneFive Osaka Sakaisuji, Nest Hotel Sapporo Odori, The OneFive
Fukuoka Tenjin, Nest Hotel Osaka Shinsaibashi, Smile Hotel Tokyo Asagaya, NestHotel Matsuyama, The OneFive Garden Kurashiki, Hotel Wing InternationalNagoya, Hotel Wing International Kobe Shin Nagata Ekimae, Nest HotelKumamoto, Valie Hotel Hiroshima, The OneFive Tokyo Shibuya, The OneFiveOkayama, and Capsule Plus Yokohama. Data for Capsule Plus Yokohama isexcluded from the above forecast because the operator did not give consent todisclose forecasts.
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Occupancy is calculated with the following formula:
Occupancy = Total number of guest rooms occupied during the period / (total
number of guest rooms * number of days hotel was in operation during the period)
4ADR or Average Daily Rate is calculated with the following formula:
ADR = Total sales from accommodation (excluding restaurant charges and otherservice fees) / number of guest rooms occupied during the period
Details of the January 2023 Rental Income Forecast by Hotel(JPY million)
Fixed Rent/
Minimum Variable
Hotel Name
Guaranteed
RentRent
Smile Hotel Kyoto Shijo
34–
Nest Hotel Sapporo Ekimae
32
46
The OneFive Osaka Sakaisuji
5–
Comfort Hotel Hamamatsu
55–
Nest Hotel Sapporo Odori
26
18
The OneFive Fukuoka Tenjin
40–
Nest Hotel Osaka Shinsaibashi
65–
Comfort Hotel Central International Airport
151–

3Total3578655444065151

Smile Hotel Tokyo Asagaya
Nest Hotel Matsuyama
The OneFive Okayama
Comfort Hotel Kushiro
Comfort Hotel Suzuka
The OneFive Garden Kurashiki
Nest Hotel Kumamoto
Valie Hotel Hiroshima
The OneFive Tokyo Shibuya
Hotel Sunshine Utsunomiya
Other1
Total

59
3572
1815
12722
44
41
226
978

75–––
1056
88––
60
294

66
40
72
1815
1283
111
45
41
286
1,273

1

Figures for Hotel Wing International Nagoya, Hotel Wing International Kobe
Shin Nagata Ekimae, Hotel Livemax Nihombashi-Hakozaki, Capsule Plus
Yokohama, Urbain Hiroshima Executive, Washington Hotel Plaza Shimonoseki
Eki Nishi, and Comfort Hotel Nagano are included in “Other” because the hotel
operators did not provide consent to disclose hotel-specific data.
 Retail: JPY 33 million of rental income (including utilities income) from retailtenants at The OneFive Osaka Sakaisuji, Hotel Wing International Kobe Shin
Nagata Ekimae, Smile Hotel Tokyo Asagaya, and Hotel Sunshine Utsunomiya,and from banquet rooms at Nest Hotel Kumamoto.

OperatingExpenses

 Depreciation: JPY 374 million. Depreciation has been calculated using thestraight-line method.
 Property and city planning taxes: JPY 123 million
 Building maintenance and repair expenses are based on what Ichigo Investment
Advisors, the asset management company of Ichigo Hotel, estimates will benecessary for each hotel during the period. However, actual expenses for theperiod could differ significantly from these forecast amounts for reasons including
the variability of maintenance and repair expenses, one-time costs due to
unexpected building damage, etc.
 Rental expenses, Ichigo Hotel’s principal operating expense (other thandepreciation, see above), are calculated based on historical data adjusted for
anticipated expense variations.
 Actual operating expenses may differ significantly from these assumptions due tounforeseeable factors.
 SG&A expenses: JPY 0.3 million for environmental certification costs.

Non-OperatingExpenses

 Interest expenses and other borrowing-related expenses: JPY 223 million

Borrowings

 Total borrowings: JPY 26.34 billion as of January 31, 2023, including loans andbonds.

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Number ofShares 254,974 shares issued and outstanding as of today. The forecast assumes there
will be no additional new issuance of shares and/or cancellation of shares throughJanuary 31, 2023.

Dividend The dividend forecast assumes that dividends will comply with the dividend
distribution policy stipulated in Ichigo Hotel’s Articles of Incorporation.
 The dividend is subject to change due to factors such as sales of portfolio assets,changes in rental income associated with operator turnover, the occurrence of
unexpected maintenance and repair costs, and fluctuations in interest rates.

Dividend in
Excess ofEarnings

 Ichigo Hotel does not plan on paying any Dividend in Excess of Earnings.

Other This forecast assumes that there are no material revisions to laws and regulations,the tax system, accounting standards, listing rules of the Tokyo Stock Exchange,
and rules of the Investment Trusts Association, Japan, and no material changes inthe state of the economy and real estate market conditions.
 Given ongoing Covid uncertainty, these earnings forecasts are subject to change.

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