February 28, 2017
For Immediate Release
Real Estate Investment Trust Securities Issuer
Star Asia Investment Corporation
Representative: Atsushi Kato, Executive Officer(Code: 3468)
Asset Management Company
Star Asia Investment Management Co., Ltd.
Representative: Atsushi Kato
President and CEO
Contact: Toru Sugihara
Director and CFO
TEL: 03­5425­1340

Notice Concerning Revision to Forecasts for Operating Results and Distribution for the 3rd Fiscal PeriodEnding July 31, 2017
Star Asia Investment Corporation (SAR) announces that it has decided to revise the operating results forecasts
and distribution forecasts for the fiscal period ending July 31, 2017 (3rd fiscal period) (February 1, 2017 to July 31,2017), described in “Notice Concerning Forecasts for the Fiscal Periods Ending July 31, 2017” announced on
December 5, 2017.
1. Revision to forecasts for operating results and distribution for the fiscal period ending July 31, 2017

Operating Operating
revenueincome(million(millionyen)yen)

Ordinary
income(millionyen)

Net
Income(millionyen)

Cashdistribution
per unit (notincluding cash
distribution inexcess ofearnings) (yen)Cashdistribution
per unit(includingcash
distribution
in excess ofearnings)(yen)Cashdistribution
in excess ofearnings perunit (yen)Previously
announced
forecasts
(A)

2,187

1,202

1,076

1,075

3,120

03,120

Revisedforecast
(B)

2,818

1,814

1,662

1,595

4,340

0

4,340

Change(C)=(B)­(A)

651

611

585

519

1,220

0

1,220

Rate ofchange(D)=(C)/(A)

30.0%

50.8%

54.4%

48.3%

39.1%

­

39.1%

(Notes)1. The above forecasts are current forecasts based on “Assumptions Underlying Operating Results Forecasts for Fiscal
Period Ending July 31, 2017” below and the actual operating revenue, operating income, ordinary income, netincome, cash distribution per unit, etc. may differ from them. In addition, SAR does not guarantee any actual cash
distribution amount by announcing the forecast figures
2. The forecasts may be subject to revision when a disparity beyond a certain degree is expected between the above1

3.

forecasts and actual figures.
Amounts are rounded down to the nearest specified unit and percentage figures are rounded to the first decimalplace.

2. Reason for revisions
SAR revised the forecast as the estimated distribution per unit for the fiscal period ending july 31, 2017 is
likely to differ by 30% or more from “Previously Announced Forecast” due to the Asset Acquisition andTransfer of Domestic Real Estate (hereinafter referred to as the “Acquisition” and “Transfer,” respectively)
described in “Notice Concerning Asset Acquisition and Transfer of Domestic Real Estate” announced today
and current conditions of operating assets.
The main factor for the revision is the emergence of an estimated 688 million yen from “Gain on sale of realestate property.” In addition, estimated 99 million yen as internal reserves.

3. Fiscal periods ending January 31, 2017 (2nd Fiscal Period) and ending January 31, 2018 (4th Fiscal Period)
SAR plans to announce the operating results and distribution for the fiscal period ending January 31, 2017
(2nd fiscal period) (August 1, 2016 to January 31, 2017) in the “Financial Report for Fiscal Period Ending
January 31, 2017(2nd fiscal period) (August 1, 2016 to January 31, 2017)”.
Also, plans to announce the operating results forecasts and distribution forecasts for the fiscal period
ending January 31, 2018 (4th fiscal period) (August 1, 2017 to January 31, 2018) in the “Financial Report for
Fiscal Period Ending January 31, 2017(2nd fiscal period) (August 1, 2016 to January 31, 2017)”.

* This material is distributed to the press club of the Tokyo Stock Exchange (Kabuto Club), the pressclub of the Ministry of Land, Infrastructure, Transport and Tourism, and the press club forconstruction trade publications of the Ministry of Land, Infrastructure, Transport and Tourism.
* Star Asia Investment Corporation website address: http://starasia­reit.com/en/

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Assumptions Underlying Operating Results Forecasts for
Fiscal Period Ending July 31, 2017

Item
Calculation period

Assumptions
Fiscal period ending July 31, 2017: February 1, 2017 – July 31, 2017 (181 days)
For the real estate beneficiary interest in trust of the 18 properties held by SAR as of the date ofthis document (referred to as the “Existing Properties” hereinafter in these assumptions), it isassumed there will be no change (new property acquisitions, sales of the Existing Properties, etc.)

Investment assets

other than “Acquisition” and “Transfer” to the investment assets through the end of the fiscal
period ending July 31, 2017.
In practice, this may vary due to changes in investment assets.
Rent revenues from the Existing Properties are calculated based on the rent stated in the leaseagreements that are effective as of the date of this document, etc. Rent revenue from theproperty planned for acquisition is calculated based on the information from the seller and rent
stated in the lease agreements that will be effective as of the date of acquisition, etc.
As to operating revenue, it is assumed no rent payments will be behind or declined by tenants.
Gain on sales of real estate property from “Transfer” is expected to be 154 million yen for theOperating revenue

fiscal period ending July 31, 2017 as described in “Notice Concerning Asset Acquisition andTransfer of Domestic Real Estate” announced on December 5, 2016.
Gain on sales of real estate property from “Transfer” is expected to be 688 million yen for thefiscal period ending July 31, 2017 as described in “Notice Concerning Asset Acquisition andTransfer of Domestic Real Estate” announced today.
SAR plans to estimate 99 million yen as internal reserves by “Gain on sale of real estate
property.”
Among expenses related to rent business of the Existing Properties, which are the principal
operatingexpenses, expenses excluding depreciation are calculated on the basis of historical

data, reflecting variable factors of expenses.
Fixed property taxes, city planning taxes and other public charges are expected to be 159 million
yen for the charges in fiscal period ending July 31, 2017.
For the property planned for acquisition, fixed property taxes, city planning taxes and otherpublic charges in fiscal 2017 will be settled on a pro rata basis based on the number of days ofownership with the seller at the time of acquisition of the property. However, in the case of SAR,
the settled amount will be included in the acquisition cost and thus will be not recorded asexpenses in the fiscal period ending July 31, 2017 and Janualy 31, 2018. In addition, fixed
Operating expenses

property taxes, city planning taxes and other public charges in fiscal 2018 will be recorded asexpenses from 2018, and are expected to total 16million yen in 2018.
For the expenditures for repair and maintenance of buildings, 47 million yen is expected for thefiscal period ending July 31, 2017 based on repair and maintenance plans drawn up by the AssetManagement Company. However, the expenditures for repair and maintenance for the fiscal
periods could differ significantly from the estimated amounts, as expenditures may arise urgently
due to damage to buildings and such caused by unexpected factors, and because the variance inamounts generally tends to be significant from year to year and repair and maintenanceexpenses do not arise regularly.
Depreciation is calculated using the straight line method and is expected to be 252 million yen for
the fiscal period ending July 31, 2017.

NOI(Net OperatingThe whole of Net Operating income is expected to be 1,485 million yen for the fiscal period
ending July 31, 20173ItemIncome)

Assumptions
NOI is calculated by using the following calculation method.
NOI = rent revenue – rent expenses (excluding depreciation )Interest expense and other financial expenses are expected to total 151 million yen for the fiscalNon­operating

period ending July 31, 2017.

expenses
As of today, SAR has a balance of loans outstanding of 30,800 million yen.
LTV is expected to be around 45.0% after “Acquisition”, “Transfer” and additional debt financing
Debt financing

above.
LTV is calculated by using the following calculation method.
LTV = Interest­bearing liabilities

Total assets

100The total number of investment units issued is assumed to be 344,700 (number of issued units asof the date of this document).
Investment units

It is assumed that there will be no changes in the number of investment units issued due toadditional issuance of new investment units and such through the end of the fiscal period ending
July 31, 2017.

SAR plans to estimate 99 million yen as internal reserves by “Gain on sale of real estate
property.”
Cash distribution per unit (not including cash distribution in excess of earnings) is calculated on
the assumption described in the monetary cash distribution policy stipulated in SAR’s Articles ofIncorporation.
Cash distribution

It is assumed that derivative transactions (interest rate swaps) will continue to be conducted.

per unit

However, deferred losses on hedges, which is an item of deduction from net assets (those(not including

provided in Article 2, item 30 (b) of the Ordinance on Accountings of Investment Corporations), iscash distribution

expected to be the same amount in the fiscal period ending July 31, 2017, and it is assumed thatin excess ofcash distribution per unit (not including cash distribution in excess of earnings) will not beearnings)

affected by changes in items of deduction from net assets in the calculation.
It is possible that the cash distribution per unit (not including cash distribution in excess ofearnings) could change due to various factors, including changes in investment assets, changes inrent revenue accompanying changes in tenants, etc., and unexpected repair and maintenance,etc. In addition, cash distribution per unit (not including cash distribution in excess of earnings)
may be affected by changes in items of deduction from net assets.
It is assumed that there will be no changes in deferred losses on hedges, which is an item of

Cash distribution
in excess ofearnings per unit

deduction from net assets, as described above. Of cash distribution in excess of earnings, that
attributable to allowance for temporary difference adjustment is not scheduled at this point.
In addition, of cash distribution in excess of earnings, that falling under the category of cash
distribution accompanying decrease in capital, etc. under tax law is not scheduled at this point.
Forecasts are based on the assumption that revisions will not be made to laws and regulations,tax systems, accounting standards, listing rules, rules of The Investment Trusts Association, Japan

Other

that impact forecast figures.
Forecasts are based on the assumption that there will be no major unforeseen changes togeneral economic trends, real estate market conditions, etc.

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