"Financial Results for the 14th Fiscal Period Ended January 2023"

Star Asia Investment Corporation

上場から 5 年、 これからの 5 年

スターアジア不動産投資法人（3468）
スターアジア投資顧問株式会社

Contents

Characteristics of Star Asia Investment Corporation (SAR)

1. A diversified REIT
Portfolio developed with diversified assets located mainly in the Tokyo Area (＊ １)

2. Steady growthPursuit of internal growth by the Asset Manager with abundant experience andknow-how as well as external growth based on asset managed performed by theStar Asia Group1.

Executive summary2

2.

Actual and forecasted distribution

5

3.

Operating results for the 14th fiscal period
ended January 2023

10

4.

Progression Status of Mid-term plan

21

5.

Initiatives on ESG

29

6.
7.

Appendix
Note

3. Initiatives focusing on unitholder value
Constant, “out-of-the-box” active management

Investment policy

35

Prioritized, focusedinvestment in theTokyo Area (＊１)

58

Investment ratio 70%
or higher in theTokyo Area

Achieving income
stability and growththroughdiversification ofasset type

Investment primarily
in middle-size
assets (＊2)*Unless otherwise stated within this document, references to all monetary amounts have been rounded down to the nearest monetary unit described, and ratios have been rounded to the decimal point described.
* In this document, Star Asia Investment Corporation may be referred to as "SAR"＊ 1 “Tokyo area”: “Tokyo area” refers to Tokyo and the three prefectures of Kanagawa, Saitama and Chiba.
＊ 2 “Middle-size assets” are properties with acquisition prices of less than JPY10bn.

1１．Executive Summary2

1. Executive Summary (1)◆ Distribution per Unit

Medium-term Guidance

Forecasts for 15th / 16th Fiscal Periods

14th Fiscal Period (ended Jan 31, 2023)◆ Forecasted Distributions Per Unit

◆ Forecasted Distributions Per Unit
Assumed cruising distribution
1,485 yen (46 yen)

15th FP 1,552 yen (0 yen)

Forecast 1,476 yen (79 yen)

※ Includes gain on sale of Funabashi Hi-Tech Park Factory II.
※ Forecast figures announced on February 1, 2023 (No revisions)※ Forecast DPU is the distribution amount announced in September 2022
※ The figure in brackets ( ) for DPU is the amount for which internal reserves havebeen utilized. The internal reserve utilization amount is calculated based on thefollowing formula:(Forecast) DPU – (forecast) net income for period per unit.
The same applies below.

◆ NAV per unit
End of 13th FP 61,129 yen

End of 14th FP 62,264 yen◆ Distribution per Unit and NAV Summary⁃

Variable rent generated from hotels (approximately 29
million yen) has been added to the initially forecasted
Distributions per Unit.

⁃

Other improved portions of revenues and expenditures
have been appropriated to retained earnings.
（Please refer to P8）⁃

NAV per unit increased by 1.9% compared to end of
the 13th FP.

⁃

Appraisal value at end of period increased by 1.2%
compared to the end of the 13th FP.

⁃ Unrealized gain、19,062million yen
9,919yen per unit

Adjusted cruising distribution
1,500 yen (46 yen)

16th FP 1,513 yen (0 yen)

Actual Results 1,491 yen (44 yen)

※ Includes gain on sale of Urban Park Gokokuji.
※ Revenues from the preferred equity securities related to HAKUSAN
HOUSE, which has a high probability of being acquired, has been added.

◆ Assumptions underlying the forecasts
for 15th FP and 16th FP.
⁃

Positioned as period for enhancing the asset portfolio,
through asset replacements, building extensions, andattracting new tenants.

⁃

Office：Certain level of improvements in occupancy rates
anticipated.（Target：98％）⁃

Retail：Attracting a supermarket is assumed towards the endof the 16th FP.

⁃

Residence：
Occupancy rates assumed to stabilize at around 97 %.

⁃Logistics：
Building extension expected to be completed towards
the end of 16th FP.
Baraki Logistics to be leased as whole building/ FR(Free Rent) to arise due to rent increase. ～ Impact
removed by gain on sale⁃

※ The assumed cruising DPU is the forecast figures (lower limit) for 15 th FP
and onward announced in September 2022.
※ The revised cruising DPU is the forecast figure after reflecting theimplementation of corporate actions.

◆ Guidance Assumptions⁃

Office：Occupancy rates will increase⁃

Retail：Attracting of supermarket completed at Suroy Mall
Chikushino, and rent accrued. Current status of otherretail facilities unchanged and operations stable.
Residence：Occupancy rates stable at around 95%⁃

Logistics：
Building extension of Funabashi High-tech Park Factory
I completed, rent accrued. Rent increase alreadyagreed are reflected, and for others, rent assumed tobe the same.

⁃

Hotel：
Variable rents anticipated to a certain extent.

⁃

Mezzanine etc.
Revenues anticipated from mezzanine loan debts
currently held and expected to be invested in, as well
as from the HAKUSAN HOUSE preferred equity
securities.

Hotel：
Further improvement of the business condition of thetenant (hotel operator) is assumed- a certain amount of variable rent has been
anticipated.

3

1. Executive Summary (2)Change in portfolio of assets under management due to active management
14FP End of January 2023

Corporate action◼ PO（5th）◼ Acquired 3 properties（Total15.1bn）◼ Asset size：195.2bn

15FP End of July 2023
◼ Asset replacement（8th）◼ Sale of Funabashi High Teck Park Ⅱ◼ Partial acquisition of Mezzanine Loan
Debt Investment (Series 8)

Property：63

No. of properties

64

64

Asset size

Logistics,
15.6％

Ratio of assets in Tokyoarea（note1）entire portfolio / excluding suburban

Property：631

64

Mezzanine：2／優先出資1

Mezzanine：2

Office,38.3％

Retail,14.2％

Logistics,
15.2％

194.8bn

Student
REsidence,
0.8%

Hotel,
13.0%

Hotel,
12.8％

195.2bn

Residence, 19.4％◼ Asset replacement（9th）assumed◼ Sale of Urban Park Gokokuji◼ Acquisition of preferred securities ofHakusan House （ assumed ）◼ Partial acquisition of Mezzanine Loan
Debt Investment (Series 8)

Property：62

Mezzanine：1

Hotel,
12.6％

16FP End of January 2024

Office,38.4％

Residence,
Retail,
19.4％
14.2％

Logistics,
15.2%

195.3bn

Residence,
18.6%

Office,38.3%

Retail,14.2%

68.8％ / 74.6％ (※）

68.7 ％ / 74.5 ％ （※）

68.8 ％ / 74.6 ％ （※）

Ratio of mid-sized
assets（note2）

98.5 ％

98.5 ％

98.4％

Average building age

24.6 years

retail facilities（note3）

Portfolio appraisal
NOI yield（note4）

4.4 ％

25.1years

25.5years(Forecast as of July 31, 2023 ）(Forecast as of January 31, 2024 ）

4.4％

4.4 ％

※ The asset size is the total amount of the acquisition price of all of the assets acquired (expected or assumed), excluding assets which have already been sold at such point or expected to be sold.
※ Tokyo Area Ratio: The ratio to the left is the ratio of assets located in the Tokyo Area to the entire portfolio (including mezzanine loan debt: acquisition price basis) The ratio to the right is the ratio when excluding suburban retail facilities 4
which are assumed to be sold (same as left).

２．Actual and forecasted distribution5

2. Actual Distributions and Business Forecast (1)Actual distributions for FP ended January 31, 2023
◆ In the 14th FP, portfolio NOI exceeding initial expectations was recorded, and the portion of variable rent from hotels wasadded to initial forecast for distributions (+15 yen per unit)◆ For the 15th FP and 16th FP, gain on sale of properties accompanying asset replacements are expected to be recorded, andcruising DPU after implementing corporate actions to be set as “mid-term guidance” at 1,500 yen.

14th FP(ending Jan 2023)-Actual-15th FP(ending Jul 2023)-Forecast-

16th FP(ending Jan 2024)-Forecast-≪ Guidance for distribution per unit ≫1,491 yen

1,552 yen

1,513 yen

◼ Aiming for the following distribution
per unit+ 15 yen (1.0%) v.s. forecast

Utilization of Internal
Reserve: 0 yen

Utilization of Internal
Reserve: 0 yen

Utilization of Internal
Reserve: 44 yen(yen）<P/L from Leasing Business>
・Increase in Hotel Revenue• Decrease in repair
expensesDecrease in leasingrelated expenses, etc.

<Gain on sale>
Funabashi High-Tech
Park II<Internal
Reserve>• Decrease inutilization

P/L from Leasing Business
DPU/14FP Forecast

Internal Reserve
OthersGain on sales
DPU/14FP result<Internal
Reserve>• Decrease inutilization

Non-operating Expenses

P/L from Leasing Business

Guidance

Others1,500

yen/unit<Difference in gain on sales>
Difference between Urban Park
Gokokuji and Funabashi HighTech Park II<Non-operating
Expenses>
Decrease of financecosts< P/L from Leasing
Business >• Increase in repair
expensesIncreasein property tax, etc.

◼ We will set a new distribution perunit as "Medium-Term Guidance".

Internal Reserve< Preferred Equity < P/L from Leasing
Business >Securities >• Decrease in• HAKUSAN
repairHOUSE
expensesDecrea
Preferred Equity
se in leasingSecurities
related expenses

Gain on sales
DPU/15FP Forecast

P/L from Leasing Business

Preferred Equity Securities

DPU/16FP Forecast

Others6

2. Actual Distributions and Business Forecast (2)Operational Results (Summary) for FP ended Jan 31, 2023 andForecast Assumptions for FP ended July 31, 2023 and FP ending January 31, 2024
◆ Office occupancy rate is steadily increasing, increase in rents have been realized, residence occupancy rates has been maintained at or above 97.0% during the 14th FP,
and occupancy rates of logistics facilities is also rising.
◆ Due to recovery of accommodation demand, variable rent from hotels have been received (approximately 29 million yen) / Further increase in variable rent revenues
anticipated going forward.

Actual Result of FP ended Jan 2023

Forecast Assumptions for FP ended Jul 2023 andFP ended Jan 2024

Office・Occupancy rate is steadily increasing (End of July 2022: 93.7% ⇒ End of January
2023: 94.3%)
・The trend of activation of potential tenants is continuing, and although there aredifferences among properties, new tenants are steadily being found.
・12 newly contracted tenants: rent increase average 5.2% (compared to rents of former
tenants). Rent increases upon renewal
・also realized: for 7 tenants, average increase of 15.9%.

・The moves of potential tenants are becoming active, and also with the agile
adjustments etc. of lease conditions, it is assumed that the upward trend ofoccupancy rates will be maintained.
・Trend towards shortening of leasing and free rent periods.
・A gradual increase in occupancy rates is anticipated for the 14th FP and15th FP/ increase in unit price of rent is not anticipated.

Retail• There were no rents that were not paid out during the 14 th. Revenues remained stable.
• 2 new tenants (137.65㎡) / 3 tenants moved out (174.19㎡), but impact is extremely
limited.
• No new requests received for exemption or reduction in rents.
～Ongoing negotiations 1tenant（Chikushino）• Ongoing negotiations are underway to invite a supermarket to Shuroa Mall
Chikushino.

・14tenant expected to move out during the 15th FP.
Expected cancellation area: 1,464.01㎡
・Occupancy rate of Shuroa Mall Chikushino is expected to decline～92.0％
・Negotiation to attract a supermarket to Suroy Mall Chikushino is toe
continued.
・Attracting supermarket tenants and improving occupancy rate

Residence・Occupancy rates during the 14th FP was maintained at or above an average of 97.0%
for all residences.
・Family-type residences continued to achieve increase in rents at time of new contracts
and contract renewals, as was the case in the preceding period.
・Single-type residences maintained occupancy rates, due to agile adjustments in rent
terms (Average occupancy rates during the period: 97.0%).

Logistics

・Revenues have remained stable, and no re-contracts/contract renewals in the 14th FP.
・Funabashi Logistics: 2 new tenants were attracted into the office-spec space which wasvacant for a long period. Occupancy rate improved: 97.8% ⇒ 98.6% (average of all
logistics facilities)
・Progressed in building extension of Funabashi Hi-tech Park Factory I

・Sale of Funabashi Hi-tech Park Factory II upon asset replacement(realization of gain-on-sale)・Revenues are expected to remain stable.
・For the 3 tenants whose contract period will expire during the 15th FP, it isassumed that the status quo will remain unchanged.

Hotel・Fixed rent received as agreed (from the 7 hotels excluding “KOKO HOTEL Osaka
Namba” which has only variable rent.”
・Given recovery of accommodation demand, variable rent was received from the tenantsof “Smile Hotel Namba” and “KOKO HOTEL Osaka Namba” (Total amount ofapproximately 29 million yen).
・Request for reduction of rent (from 1 tenant) was withdrawn.

・It is assumed that the business performance of tenants will further improve
as domestic travel demand is maintained and the trend towards increase of
inbound visitors will continue given the lifting of travel restrictions fromabroad (excluding certain areas).
・During the 15th FP and 16th FP, it has been assumed that a certain levelof variable rent will be received.

・Sold Urban Park Gokokuji in the 16th period on the premise of asset
replacement (realized gain on sale)・It is assumed that current average occupancy rates will be maintained
during the 14th FP.
・Rents are assumed to remain at the same level.

72. Actual and forecasted distribution (3)Factors for increase/decrease compared with forecast/actual results for the 14FP
◆ Rental revenues, excluding hotel revenues, were almost in line with the initial forecast / NOI increased (vs. forecast) due to the effect of reduced repair
expenses◆ Variable rents from hotels, which were not expected in the initial forecast, were added to the distribution - +15 yen/unit compared to the initial forecast(Unit: million yen)
14 FP (ended Jan.
2023) forecast*
6,363

14FP (ended Jul.
2022) Actual
6,463

Office rent

2,056

2,036

△20

Retail rent

1,035

1,038

3

Residence rent

1,216

1,225

9

Logistics rent

914

914

0

Hotel rent

503

537

34

6.8%

Other
Expenses related to rent business(Depreciation is excluded)
NOI

637

710

72

11.4%

1,804

1,812

8

0.5%

4,559

4,650

91

2.0%

734

743

8

1.2%

3,824

3,907

82

628

605

△22

3,931

4,044

113

2.9%

24

22

△1

△5.5%

Lease business revenue

Depreciation
Rent revenues/expenses
Capex
NCF(NOI-CAPEX)
Mezzanine

Comparison with
forecast
99
1.6%<Revenue of leasing business>variable rent +29 million yen
0.3% Utility revenue+52.9 million yen
Penalty charge revenue +6.4 million yen
0.8%
Original state restoration fee revenue +5.3 million yen
0.1% Renewal fee revenue +4.0 million yen△1.0%<Expenses of leasing business>
Utility costs +74.5 million yen
2.2% Repair costs -35.7 million yen
Leasing costs -30.3 million yen

△3.6%

585

580

△5

△0.9%

3,263

3,349

86

2.6%

Non-operating income

-

1

1

-

Non-operating expenses

576

568

△7

△1.4%

Ordinary income

2,686

2,782

95

3.6%

Income before income taxes

2,686

2,782

95

3.6%

SGA
Operating income

taxes

0

0

-

0.0%

2,686

2,781

95

3.6%

Cash distribution per unit

1,476 yen

1,491 yen

15 yen1.0%

FFO per unit

1,780 yen

1,834 yen

54 yen3.0%

AFFO per unit

1,453 yen

1,519 yen

66 yen

4.5%

8,735

8,802

66

0.8%

1,397 yen

1,447 yen

50 yen3.6%

Net income

Balance of internal reserves(Reference) Net income per unit
(Yen per unit)（*）Announced in 13th FP closing of accounting report (Sep 13, 2022)

Factors for the increase/decrease82. Actual and forecasted distribution (4)Forecast of business results for the 15FP ending July 2023 / the 16FP ending January 2024
◆ Acquired 3 new properties through a public offering in August 2022, and the 3 new properties will fully contribute to the period ending July 31, 2023
◆ Aiming for gradual increase in occupancy rate of office buildings toward the end of the 16th fiscal period(Unit: million yen)
14 FP (ended
Jan. 2023)
Actual(Ａ)
6,463

Forecast forthe 15 FP
ending Jul
2023 (B)
6,576

112

1.7% ＜Rental revenues＞

6,550

Office rent

2,036

2,076

40

2.0%

2,112

Retail rent

1,038

1,046

7

0.8%

Residence rent

1,225

1,232

6

0.5%

Logistics rent

914

846

△68

△7.5%

Hotel rent

537

515

△21

△4.0%

Other

710

858

147

20.8%

1,812

2,126

313

17.3% 【Logistics 】 Decrease due to sale of

2,049

4,650

4,449

△201

△4.3% Funabashi Hi-Tech Park Factory

4,500

743

760

16

3,907

3,689

△218

2.3% High-Tech Park Factory IIDecrease△5.6% due to free rent periodIncrease in

3,714

605

871

265

43.8% occupancy rate of Funabashi

1,072

4,044

3,578

△466

Gain on sales

-

413

413

Mezzanine

22

22

0

-

-

-

580

598

18

3,349

3,527

177

Lease business revenue

Expenses related to rent business(Depreciation is excluded)
NOI
Depreciation
Rent revenues/expenses
CAPEX
NCF(NOI-CAPEX)

Preferred securities lending fee
SGA
Operating income

Forecast for the
Increase/decrease
16P ending Jan(C-B)
2024(C)

Increase/decrease(B-A)
【Office】 Urban Center
FujisawaIncrease in the number ofoperating days at Urban Center
FujisawaAssumption of backfilling of
vacant parcels in existing
propertiesRetail PropertiesIncrease inoperating days at Abeno nini (retailfacility), etc.

IIDecrease due to sale of Funabashi△11.5%

Logistics- 【Hotel】 Decrease due to the sale of
Abeno nini (hotel)Increase in numberof operating days at Abeno nini
- (hotel)Decrease in variable rents, etc.

877
535
813

786

3,428
271
34

3.1%

601

3

5.3%

3,448

△78

＜Rental expenses＞Utilities +116.0
million yenRepair expenses +98.5△100.0% million yenTaxes and dues for△4.4% property acquired in August 2022
+26.4 million yenLeasing-related
7.2%
expenses +56.3 million yen

1

-

△1

Non-operating expenses

568

543

△25

Ordinary income

2,782

2,983

201

Income before income taxes

2,782

2,983

201

0

0

-

2,781

2,983

201

Cash distribution per unit

1,491yen

1,552yen

61yen

FFO per unit

1,834yen

1,732yen△102yen

4.1% ＜SGA＞ Increase in taxes and△5.6% public charges (non-deductible

AFFO per unit

1,519yen

1,279yen△240yenconsumption tax) due to sale of△15.8% properties, etc

8,802

8,803

0

Net income

1,198

7.2%
0.0% ＜Sale of Funabashi High-Tech Park
7.2%

Factory II＞

30

-

-

539

△4

2,909

△74

2,909

△74

0

-

2,908

△74

1,513yen △39yen
1,781yen△0.4% ＜Rental revenues＞【Office】 Urban Center
FujisawaAssuming a certain level of△34 △3.3% occupancy rate improvement△34 △2.8% 【Retail 】Shuroy Mall Chikushino 34.5 million yen
31
3.7%【Residence】 Decrease due to sale19
3.8% of Urban Park Gokokuji,△44 △5.2% etc.Decrease due to sale of Urban
Park Gokokuji, etc.【Logistics 】△77 △3.6% Increase due to decrease in free
51
1.1% rent periodDecrease due to sale of
Funabashi High-Tech Park Factory
25
3.4% II
25
0.7% 【Hotel】 Decrease due to increase in201
23.1% variable rents, etc.Increase invariable rents, etc.
△150 △4.2% 【Other】 Increase in utilities income△142 △34.5% +36.3 million yenIncrease in utilities
income +36.3 million
11
50.2%
yenCancellation penalty income 30- 83.9 million yen

35

△0.4%

Non-operating income

Taxes

1,012

△26

Major factors for theincrease/decrease

49yen

1,223yen △56yen

1.7%

0.5%

＜Rental expenses＞Funabashi
High-Tech Park Factory II, sale of- Gokokuji (15.7) million yenUtilities:△0.8% +41.4 million yenLeasing-related
expenses -59.7 million yenRepair△2.5%
expenses -27.1 million yen

△2.2%

△2.5%

0.0% ＜Gain on sales＞Urban Park
Gokokuji (gain on sale) - Funabashi△2.5% High Tech Park Factory II (gain on△2.5% sale)
2.8%<Loan fees for preferred securities△4.4% ＞Hakusan House Preferred
Securities Lending

Balance of internal reserves

0.0% .＜Non-operating expenses＞

8,804

1

0.0%

1,513yen△39yen△2.5%

Decrease in financing costs(Reference) Net income per unit

(Yen per unit)

1,447yen

1,552yen

105yen7.3%

9

３．Operating results for the 14th fiscal
period ended January 2023

10

３．Operating results for the 14th fiscal period ended January 2023 (1)- Occupancy rate status ◆ For the portfolio as a whole (real estate properties etc.), occupancy rates were maintained at or above 97% during the 14th FP (on acontracted floor area basis).
◆ For the 15th FP and onward, we will aim for further improvement in office occupancy rates, and promote internal growth measures (attracting
new tenants to retail facilities, building extension of logistics facilities).
100.0%

Hotel, 100.0%

99.0%

Retail, 98.6%
Logistics, 98.6%

98.0%

Total, 97.6%
97.0%

Residence, 97.5%

96.0%
95.0%

Office, 94.3%

94.0%
93.0%
92.0%
91.0%

OfficeRetailResidence

Logistics

Hotel

13FP

Total

14FP

90.0%

11FP
(Jul 2021)

12FP(Jan 2022)

13FP(Jul 2022)

14FP
Aug 2022

Sep 2022

Oct 2022

Nov 2022

Dec 2022

Jan 2023

Office

93.1%

92.8%

92.8%

94.4%

93.8%

94.4%

93.5%

94.3%

94.3%

Retail

98.8%

99.4%

99.4%

98.7%

98.7%

98.6%

98.6%

98.6%

98.6%

Residence

94.4%

95.1%

95.1%

97.2%

97.4%

97.1%

97.1%

97.3%

97.5%

Logistics

97.8%

97.8%

97.8%

97.8%

97.8%

98.3%

98.3%

98.6%

98.6%

Hotel

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Total

96.6%

96.7%

96.7%

97.4%

97.3%

97.5%

97.3%

97.6%

97.6% 11

３．Operating results for the 14th fiscal period ended January 2023 (2)- Responses to increase in energy costs◆ For tenants where electricity charges are being claimed from the owners, shift to the variable amount billing method which is linked
to the increase in electricity charge payments.
◆ From the 15th FP onward, although the cost burden for common-use areas is anticipated to increase, the impact is expected to be limited.

Burden of Cost for Electricity Charges
OfficeRetail◼ Excluding whole-building
leases (※1) and sectional
ownership buildings, thebilling method towards
tenants shifted from fixed
Burden of Cost for
to Pass-through amountElectricity Charges
billing, to absorb increase(Details)
in electricity charges.
◼ The common-use area
costs borne by theinvestment company.

◼ For the 3 properties which
are whole-building leases,
the tenant has directcontract with utilities.

Residence◼ For the exclusively-owned
area, direct contract bytenant.

Logistics

Hotel◼ For the 5 properties which
are whole-building leases(※2), the tenants have a
direct contract with utilities.

◼ For 2 other properties, for◼ Direct contract by hotel
the exclusively-owned area
◼ For 4 properties, the billing
operator.
◼ For the common-use area,
the tenant has a direct
method has been shiftedborne by investment
contract, and the commonfrom fixed to variable form,
company.
use area costs are borne
to pass on increase inby the investment
utility costs.
company.

※1 Excluding “Amusement Media Gakuin Honkan” and “Amusement Media Gakuin Shinkan”. ※2 Excluding “Yokohama Logistics”.

Actual and Forecast of Utility Costs
(Mil)
600

The ratio of utility
costs P/L to thetotal revenues ofleasing business.

400
200

13FP
Actual14FP
Actual15FP
Forecast

16FP
Forecast-0.50 ％

-0.71 ％

-1.34％-1.40 %

-200
※ Calculated by the formula to the right: Ratio = (utility cost revenues - utility cost expenditures) ÷ (total leasing business revenues utility cost revenues)

-400
-600

Utility revenue

Utility costs◼ Utility cost revenues increase in conjunction with the increase in utility cost
expenditures

Difference

-800
10FP
2021/111FP
2021/712FP
2022/113FP
2022/714FP
2023/1

15FP forecat 16FP forecat2023/72024/1◼ Although the ratio of utility costs P/L to leasing business revenue is not increasing,
due to the shift towards the billing method which incorporates electricity charges as
described above, the extent of increase has settled down.

12

3. Operating results for the 14th fiscal period ended January 2023 (3)- Office - Status of change in tenant as of the end of the 14FP
Operating result for office

Status of change in tenant as of the end of the 14FP

<Actual performance for 14th Fiscal Period>◼ Entry and moving out of tenants:
Newly contracted area (2,661.25㎡) > moved out area (2,107.46㎡).
Occupancy rates: 93.7% (as of end of July 2022) → 94.3% (as of end of January2023)◼ Newly attracted tenants: 12 tenants (rents increased on average of 5.2% compared
to before)◼ Free rent: Average 2.4 months.
◼ Increase in rents at time of contract renewal: 6 tenants (average of 0.8% increase
compared to before)◼ No reductions at time of contract renewal.
◼ Rent increases also realized during the lease periods, instead of at the time ofcontract renewals.
◼ For 1 tenant, rent was increased by 10.8%.
<Forecast for 15th Fiscal Period and onwards>◼ The moves of potential tenants are becoming active, and getting good responses inleasing activities. -- From the 14th FP to the 15th FP, a gradual increase in occupancy
rates is anticipated.

Number oftenants

Rent up

6

Same rent

1

Rent down

5＜Renewal＞

42

Rent up(※)

6

Same rent

36

Rent down

0

15,210.20 ⁃ Average 0.8% increase at
1,557.74 renewal + 571 thousand
yen/month
13,652.46 ⁃ No tenant reduction at the time
0.00 of renewal＜Leaving＞

9

2,107.46

Contracted occupancy rate / effective occupancy rate
96.0%

2,661.25⁃ Average rent increase of 5.2%
1,801.13+ 525 thousand yen/month
126.31 ⁃ Average free rent 2,4 months
733.81

12＜New Contract＞

Contract Rent Period of Office Portfolio
8,000 ㎡

95.0%

Area(㎡)

Area of Move in

Area of Move out※（ ） Number of tenants

6,000 ㎡

94.3%

94.0%

4,000 ㎡

93.3%

93.0%

2,000 ㎡
0,000 ㎡

92.0%

(7)

(19)

(7)

(10)

(13)

(7)

7FP

8FP

9FP

10FP

11FP

2020/72021/12021/7

(8)
(13)

(14)
(13)

(9)

(12)

(12)

(7)

(10)

(10)

12FP

13FP

14FP

2022/12022/72023/1-2,000 ㎡

91.0%-4,000 ㎡
90.0%
89.0%

Effective occupancy rate

Contract occupancy rate

-6,000 ㎡-8,000 ㎡※ Effective occupancy rate = (Contracted area - Rent-free area) / Leasable area

2019/72020/113

3. Operating results for the 14th fiscal period ended January 2023 (4)- Office - ② Status of Rent Gap and Trends in Unit Rents ～Contract Rent Period of Office Tenants

Trends in Market Rents and Contract Rents per Unit, Average FR Period（yen）

Average unit rent（yen/tb）

14,600Market Rent（yen/tb）

30,000㎡※（ ）Free Rent

Rent gap less than0%

14,567◼

14,400Change due to inclusion of Urban
Center Fujisawa (beginning of 14th
fiscal period)

14,21914,20071

25,000㎡

20,000㎡

64＋1.1％

13,76754

15,000㎡＋0.5％

13,80010,000㎡
13,60013,40013,200Rent gap 10% or more※（ ） Number of tenants

68

14,04014,000Rent gap 0% to less than 10%

13,791

13,86414,014（2.1M）（2.3M）（1.9ヶM）（2.1ヶ月）（2.3ヶ月）（1.9ヶ月）11FP
2021/712FP
2022/1

13,820（2.4ヶM)（2.4ヶ月）13FP
2022/7125,000㎡

0㎡

14FP
2023/115FP
2023/7• The aggregate rents of the top 5 tenants makes up for aratio of 17.6% of the office portfolio rent revenues, and risk
is diversified.
Property name

17.6%

Type

ratio

businesscompany

5.9％

１

Honmachibashi Tower

２

Amusement Media Gakuin
Honkan/Shinkan

School3.8％

３Urban Center Hakata

Master lease

3.8％

４

Honmachibashi Tower（住宅部分）

Master lease

1.8％

５

Urban Center Fujisawabusinesscompany

2.3％

Total

17FP
2024/718FP
2025/119FP or after
2025/7-Addressing leasing issues

Tenant Diversification＜Rent-based＞

16FP
2024/1【Urban Center Tachikawa （Tachikawa city, Tokyo）】

A memorandum has been signed with a new tenant, and leasing of 1
floor is expected to commence from May 2023 ⇒ occupancy rates
82.0%
For the 1 remaining floor, we will focus on leasing activities byconducting interior preview tours etc.

Acquisition price

1,804 mil

Structure

RC S 6F/1B

Leasable area

3,400.47㎡

May 2022

Jun 2022

May 2023（予定）

Construction
completion

May 1990

33.9 ％

65.1 ％

82.0％【 Nihonbashi Hamacho Park Building （Chuo-ku, Tokyo）】 •17.6％

Of the 4 sectional ownership compartments, 1
compartment is vacant.

Acquisition price

1,450 mil

Structure

SRC 11F

Leasable area

1,913.44㎡

Dec 2021

Jan 2022

Jun 2023（見込）Construction
completion

Jul 1992

100.0 ％

74.9 ％

100.0 ％•

An application for leasing has been received from 1
tenant candidate.

14

3. Operating results for the 14th fiscal period ended January 2023 (5)- Retail ◆ Basic policy: The policy to sell suburban retail facilities is maintained/ Pursue maximization of profits during the holding period◆ At Suroy Mall Chikushino, making efforts to attract a supermarket which has high effect of attracting customers, and considering
returning the leased land portion as a cost reduction measure.

Operating results for Retail

Suroy Mall Chikushino (Case Studies)＜Retail Basic Information＞

Acquisition price

Property nameUrbantype

Location

Number oftenants

Total floor
area
（㎡）

BAGUS Ikebukuro West

Toshima Ward, Tokyo1

1,497.45

100.0%

Abeno nini (Retail)Osaka city, Osaka

5

3,481.03

100.0%

La Park Kishiwada

Kishiwada City,
Osaka

53

40,774.23

99.4%

Koka City, Shiga

1

23,814.87

100.0%

Chikushino City,
Fukuoka

20

29,950.48

96.3%

80

99,518.06

98.64%

SuburbanSeiyu Minakuchi
type
Suroy Mall Chikushino＜＜14FP Actual＞◼ Rent revenues have remained stable/ No changes to tenants other than as described below, and the impact ofsuch changes is extremely limited.
Change of tenants (Lapark Kishiwada): 3 tenants cancelled (174.19㎡), 2 tenants newly contracted (137.65㎡).）＜Key points of focus for 15th Fonward＞◼ Suroy Mall Chikushino: Promote attracting a P and supermarket – attract new tenants to vacant spaces.

Revision of Contract Period （ based on floor area ）S 2F

Leasable area

31,088.53㎡

Number of
Tenants

20

Construction
completion

Jun 2007◼ Making efforts to attract a supermarket which can be an anchor
tenant with high effect of attracting day-to-day visitors.
It is assumed that operations will commence and rents will arise
from the latter half of the 16th FP.
Aim to increase occupancy rate in line with the opening of thesupermarket (92.0% during the 15th fiscal period due tocancellations)◼ As a cost reduction measure, considering return of leased land
portion (the parking lot portion which has low usage rate).

Asset management which contributes to the revitalization of the local community

6,000 ㎡※（ ） Number of tenants

5,000 ㎡

Structure

Occupancy rate
(As of Jan 31, 2023)

6,550 mil.

◼ Collaborate with other businesses in the area and the municipality,
and contribute to the neighboring areas and revitalized the local
society by using held real estate properties.

4,000 ㎡

La Park Kishiwada

3,000 ㎡
2,000 ㎡

(13)

(16)

(7)

(9)

(3)

(4)

15FP
2023/716FP
2024/117FP
2024/718FP
2025/119FP
2025/720FP
2026/1(3)

1,000 ㎡
0,000 ㎡
21FP
2026/722FP
2027/1

Haruki Area Danjiri Festival(provided as a resting place)※ Extract tenants whose contracts will expire by the 22nd fiscal period; 27 tenants (contracted area: approx. 79,666.95㎡ ) in the 23rd fiscal period and thereafter

2022 Citizen’s Movement
Promotion Council to Beautify the
Town

15

3. Operating results for the 14th fiscal period ended January 2023 (6)- Residence ◆ Occupancy rates during the 14th FP has transitioned at an average of 97% or more/ Decision made to sell 1 of the single-type residences which havehighly volatile occupancy rates.
◆ At family-type residences (exclusive area of 30㎡ or more), new rent increases have been achieved at both the timing of new entrants and contract
renewals.

Operating results for residence

Transition of occupancy rates＜14FP Actual＞

100.0%

97.5%
97.5%

◼ Entering and leaving of tenants ：Area move in（6,164.81㎡）＞ Aria move out （6,135.91㎡）◼ Entering and leaving, Rent Fee：Total rent（monthly amount）＋1,391,600 yen

95.0%

30㎡ or more

90.0%

Less than 30㎡
Number oftenants

Total monthly
amountNumber oftenants

New contract

32△186,500 yen

86＋1,299,100 yen

Renewal

27

0 yen

247

＋275,000 yen

Cancellation

28

※

－

85

Total monthly amount

－

96.9%

85.0%

FamilyShingle

80.0%

Total
8FP

75.0%

9FP

10FP

11FP

12FP

13FP

For newly entering tenants, only those housing units for which the former tenant’ rent is known arecompared, and the difference is aggregated.

Transition of total monthly rent

Example of measures to improve tenant satisfaction◼ Urban Park Mizonokuchi Installed a dog park(“dog run”)
Vacant space within the site was effectively used and changed toa dog park for exclusive use by residents. Exclusive foot wash
space and leash hook have been installed, and improvement ofresident satisfaction was achieved.

< before >

20.0%

◼

15.0%
◼
10.0%

For single-type residences,monthly rents haveincreased along with the
improvement in theoccupancy rates.
For family-type residences,increase in rents have been
confirmed.

14.9%

7.6%
6.8%

< after >5.0%

Shingle

0.0%

-4.8%
-5.0%

※singles-type housing : UP Namba, UP Gokokuji, UP Koenji※ The “Transition of Gross Monthly Rents” has been calculated as the total amount of rents and common-use fees stated in theeffective lease agreements at the end of each month, and indexing it to such amount as of the end of August 2018 (assuming
such amount is 100). There are no changes in properties since August 2021.

FamilyTotal

16

3. Operating results for the 14th fiscal period ended January 2023 (7)- Logistics ◆ Gain-on-sale generated from the sale of 1 property (8th asset replacement)◆ Signed a building lease option agreement for building extension, which is expected to contribute to improvement of revenues in the
16th FP.

Operating results for Logistics

Extension of Funabashi Hi-Tech Park Factory Ith<14 fiscal period: actual performance＞◼ Improvement of occupancy rates: Attracted new tenant to vacant office space◼ Logistics facilities portfolio:97.8％ → 98.6％<Initiatives to be taken from 15th fiscal period and onward＞◼ Sale of Funabashi High-Tech Park Factory II (asset replacement) – realize gain-onsale◼ Funabashi High-Tech Park Factory I – Sign a building lease option agreement,
presupposing building extension.
◼ Negotiate with tenants whose lease agreements will expire during the 15th FP.
‐3 tenants (36,038.85㎡): Renewal or re-contract under the same conditions(expected).
◼ For 1 property which is being used by 2 tenants, as the lease agreement for 1 of thetenants will be terminated (expected), the property will become a whole-building lease.
- Although a free-rent period will be established, on a cruising basis, revenues will
increase by around + 7 million yen / year

Revision of Rent and Contract Period◼ Objective of building extension (revenue improvement measure)
Aim for “building extension” to utilize unused floor area ratio – Attempt to increase rent
revenues.
◼ Rent revenue during the building extension period.
The current lease agreement (and current rent payments) will continue as is. No downtime.
◼ Progress status
Confirmation application already submitted/ Increased rentable area: 527.24㎡
The contract for the building extension is under negotiation.
◼ Overview of the Building Lease Option Agreement•

The agreement provides that after the extension works is completed, the building will betreated as a single building, and stipulates to amend the rent amount, leased area, andcontract period etc. of the current lease agreement.

•

Establishes a non-cancellable period of 10 years•

Assumed leased area after extension (Note 1) is a 5.7% increase from the current leased
area.

•

Assumed monthly rent after extension (Note 2) is a 20.4% increase from the current
monthly rent.

※（ ） Number of tenants
60,000 ㎡(3)50,000 ㎡
40,000 ㎡(3)30,000 ㎡(1)
20,000 ㎡

(2)

(2)

16FP
2024/117FP
2024/7

10,000 ㎡
0,000 ㎡
14FP
2023/115FP
2023/718FP
2024/119FP or after17

3. Operating results for the 14th fiscal period ended January 2023 (8)- Hotels ◆ Variable rent received from 2 tenants, “Smile Hotel Namba” and “KOKO HOTEL Osaka Namba” (Approximately 29,000 thousand yen).
◆ Clear recovery of business conditions of hotels - Rev PAR has recovered to pre-COVID 19 (2019) levels.

Hotel portfolio (9 properties)<Status of 14th Fiscal Period>◼
Collected fixed rent (as agreed) + Variable rent (from 2 hotels)- The policy is to increase distributions reflecting the variable rents received, which was not
anticipated in the initial forecast.
◼
Request for rent reduction (from 1 tenant) – request withdrawn◼
Due to the effect of COVID-19, 1 hotel is still closed/ timing of resuming operations not yet
determined – rents are received as agreed.
<Assumptions for 15th Fiscal Period and onward>◼
Assumed that fixed rents will be received as agreed.
◼
Given the status of recovery of hotel operations, although there are seasonal factors, acertain level of variable rent revenues is anticipated.
◼
A variable rent component is included in the rent structure for 6 hotels, and upside is
expected.
Continuing negotiations with the hotel operator of abeno nini (hotel) (for operator change)

Rev PAR recovery
(%）
140

Fixed

Floating

R&B Hotel Umeda East

2016.4○－

Smile Hotel Namba

2016.4○○REMBRANDT STYLE Tokyo Nishikasa

2017.3○○

BEST WESTERN Yokohama

2017.3○○

The BREAKFAST HOTEL FUKUOKA TENJIN

2018.8○○

GLANSIT AKIHABARA2018.8○－REMBRANDT STYLE Tokyo Nishikasai
Grande2018.8○〇

KOKO HOTEL Osaka Namba

2018.8－○abeno nini (Hotel)

2022.8〇－Transition of Floating(mn）
60◼ Given the transition in Rev PAR,
recovery of business conditions ofhotel is clear.

120

Acquisition
Date

Name of Property

117
50

100

40

◼

For the purpose of the business forecast,
expectations for variable rent revenue havebeen set conservatively compared to the
14th FP.

80
30
60

92

40

20

20

10

Jan-23

Nov-22

Jul-22

Sep-22

May-22

Jan-22Mar-22

Nov-21

Sep-21

Jul-21

May-21

Jan-21

Mar-21

Nov-20Jul-20

Sep-20Mar-20May-20Jan-20Nov-19Jul-19Sep-19

May-19Jan-19Mar-190※ Rev PAR of 7 hotels whose operating conditions are known, averaged for each month since January 2019,and indexed with January 2019 as 100

1FP
2FP
3FP
4FP
5FP
6FP
7FP
8FP
9FP
10FP
11FP
12FP
13FP
14FP
15FP
16FP
2016/7 2017/1 2017/7 2018/1 2018/7 2019/1 2019/7 2020/1 2020/7 2021/1 2021/7 2022/1 2022/7 2023/1 forecast forecast18

3. Operating results for the 14th fiscal period ended January 2023 (9)- Financial standing ◆ The basic policy is to maintain LTV levels, increase long-term borrowings, and fix interest rates.
◆ Upon making borrowings, aim to fix interest rates while taking into account costs, in preparation for future interest rate increases.
/Diversify lenders (Explore opportunities to issue investment corporation bonds)

Main financial indicators (※1）

Bank formation (as of Mar 14, 2023）

13FP
Jul 2022

14FP
Jan 2023

As of Feb 20,
2023

As of Mar 14,
2023

LTV

46.3 %

46.4 %――

Interest-- bearing debt
balance

89,640 mil

96,840 mil

96,840 mil

96,840 mil

Long-term debt ratio

100.0 %

100.0 %

100.0 %

100.0 %

3.0 years

2.9 years

3.4 years

3.3 years

5.1 years

5.1 years

5.1 years

5.1 years

0.77 %

0.78 %

0.76 %

88.4 %

95.1%

83.9%

Average remaining
period to maturity
Average borrowing
periodAverage interest rate(※2)
Fixed interest rate ratio

Lender

Ratio

Sumitomo Mitsui
Banking

26.2%

The Kiyo Bank, Ltd

1.5%

Mizuho Bank

19.3%

The Nishi-Nippon City
Bank

1.5%

SBI Shinsei Bank

14.4%

The Chiba Bank, Ltd

1.0%

Sumitomo Mitsui Trust
Bank

11.3%

Corporation Bonds

1.0%

Aozora Bank

9.9%

Mizuho Trust &Banking

0.8%

96,840Resona Bank

6.0%

San-ju San Bank

0.5%

million yen

0.80 %

Minato Bank

2.1%

0.5%

95.1%

The Bank of Fukuoka

1.7%

The Dai-ichi Life
Insurance
Fukoku Mutual Life
Insurance Company

The Bank of
Yokohama,Ltd.

1.5%(※1) This describes the status including investment corporation bonds.(※2) The interest rates shown take into
consideration the effects of interest rate swaps (fixing of interest rates).

Diversification of repayment dates(as of Feb 20, 2023)
(mil）

1.40%

14,000
Fixed

12,000Floating

Corporation Bonds

Interest rate

1.20%

10,000

1.00%

8,000

0.80%

1,000

6,000

11,850
9,060

8,500

4,000

7,300
4,840

2,000

3,785

0.60%

11,215
8,750

9,700

Ratio

LenderInterest-- bearing
debt balance

0.5%

Credit Ratings
Japan Credit Rating Agency, Ltd. (“JCR”)

Long-term Issuer RatingA (Stable)

Rating and Investment Information, Inc. (R&I)

Issuer Rating
A－ (Stable)

Transition of LTV
49.0%
48.0%

9,790
7,050
3,000

1,000

15FP 16FP 17FP 18FP 19FP 20FP 21FP 22FP 23FP 24FP 25FP 26FP 27FP

0.40%

47.0%

0.20%

46.0%

46.4%

45.0%

0.00%

44.0%
43.0%
1FP

2FP

3FP

4FP

5FP

6FP

7FP

8FP

9FP 10FP 11FP 12FP 13FP 14FP

19

3. Operating results for the 14th fiscal period ended January 2023 (10)- Capex Control –◆ Led by the Sustainability Promotion Division, appropriate control of Capex/ secure free cashflow in cooperation with the Finance Division.
◆ Reduce costs by reducing energy consumption, by reducing economic burden and also by introducing highly efficient equipment.
- Contribute to internal growth.
Capex Management••(Unit: thousand yen)Centrally manage budget planning and progress on
Capex centered on the Sustainability Promotion
Division
Consider moving the plan forward depending on thebudget exhaustion status and budget reduction status.

1,200,000＜Schedule of Capital Expenditures for the 15th fiscal period＞

800,000

REMBRANT STYLE Tokyo Nishi-kasai

Air-conditioning facilities renewal works
Seishin Building

Entrance renewal construction works
planning capital expenditures which will
directly connect to increase in revenues.

30
million yen

Capex Actual

Depreciation cost

Depreciation cost (Forecast)◼ In the 15 FP and 16 FP, planning
capital expenditures which will directly
connect to increase in revenues.
th1,000,000

58
million yen
50
million yen

Capex Forecastth600,000

400,000

200,000＜Schedule of Capital Expenditures for the 16th fiscal period＞
planning capital expenditures which will
directly connect to increase in revenues.

Approximately.
282
million yen

0
10FP
2021/111FP
2021/712FP
2022/113FP
2022/714FP
2023/115FP
2023/716FP
2024/1(Unit: thousand yen)

10FP
Jan 2021
Actual11FP
Jul 2021
Actual12FP
Jan 2022
Actual13FP
Jul 2022
Actual14FP
Jan 2023
Actual15FP
Jul 2023
Forecast

16FP
Jan 2024
Forecast

Depreciation cost

628,354

633,013682,245

697,599743,661

760,593

786,178

Capex Forecast

552,841

453,448507,750

520,543

628,409871,225

1,072,438

Capex Actual

331,901

363,439424,722471,534

605,932――

Capex Budget reduction rate

40.0%

19.8%

16.4%

9.4%

3.6%

―

―

Capex ratio （Capex Actual／
Depreciation cost）

52.8%

57.4%

62.3%

67.6％

81.5%

―

―

Repair cost（Actual／Forecast）

181,949

220,204

181,998

255,201

173,257

271,769

240,000

53

53

60

60

63

62

61

Number of Properties20

４． Progression Status of Mid-Term Plan

21

４． Progression Status of Mid-Term Plan (1)Progression Status of Mid-Term Plan
◆ In March 2021, the mid-term plan will set asset scale target: 300 billion yen and distribution growth target per unit: 1,600 yen.
◆ Progress: Asset scale: 194.8 billion yen (as of August 31, 2022), distribution per unit: 1,500 yen (forecasted cruising distribution)

Mid-Term Plan （Target year FY2026）
Asset Size (Target): JPY

300 billion

Indicative number of properties 100

Distribution Per Unit (Target):

1,600 yen or more

Growth objective of 2% per annum

Progress status as of the end of Feb. 2023
Assets Size

As of the end of January 2023

194.8 billion yen

Priority measures going forward:➢ Expand asset size by gathering highly liquid middle-sizedproperties.
➢ Improve income stability by diversifying the portfolio.
➢ Think “outside the box” and consider all measures.
➢ Sponsor pipeline (The fund’s assets under management of JPY
205.7 billion, pursuit development deals)➢ Find deals through the asset management company’s own
unique network.
➢ Conduct asset replacements as necessary.

Distributions Per Unit

Cruising Distributions Per Unit

1,500 yen

Priority measures going forward:➢ Improve distribution per unit through external growth, internal
growth.
➢ Cooperate with sub-sponsor (Nippon Kanzai Group)➢ Resolve rent gaps in the office portfolio.
➢ Rebuild the property management system to suit the portfoliomix.
➢ Reduce costs leveraging on the economy of scale➢ Optimize repair costs/ capital expenditures.

22

４． Progression Status of Mid-Term Plan (2)8th asset replacement◆ Conducted sales activities, along with considering internal growth measures (building extensions, redevelopments). Selected sales
opportunities where it was determined that gain-on-sale can be achieved and would contribute to maximization of unitholders’ interests.
◆ Executed mezzanine loan debt investments with high dividend ratio, backed by a hotel asset in central Tokyo.

Asset （to be acquired）

Transferred Asset
Funabashi Hi-Tech Park
Factory II（Logistics）

Property nametransfer dateFeb 20, 2023

sales price

1,150 million yen

Appraisal value

705 million yen

Book value

689 million yen

Gain of Sales

413 million yen

NOI Yield

4.3 ％（※）

Verification for
maximizing
unitholders' profit⁃ Verification of potential forinternal growth throughutilization of unused floor space(expansion, redevelopment)⁃ Realization of unrealized gains
through sales - Increased
distributions to unitholders

Effects of asset replacement

Name of asset

Star Asia Mezzanine Loan Debt Investment Series 8＜Underlying Asset＞：CENTURION HOTEL GRAND AKASAKA（Planned）
acquisition date

Class A Beneficial Interest：Aug 31, 2023 or such other date to be
separately agreed by SAR and the seller.
Class B Beneficial Interest：Feb 20, 2023

（Planned）
Acquisition priceClass A Beneficial Interest：430 million yen
Class B Beneficial Interest：340 million yen

Dividend Yield

Class A Beneficial Interest：3M TIBOR＋5.30％
Class B Beneficial Interest：3M TIBOR＋7.30％＜ Sale of asset ＞◼ Realize gain-on-saleApproximately 413 million
yen◼ Received penalty moneyfrom the cancelation of
fixed-term building leaseagreements with existing
tenants.
◼ Dividend ratios is 6.1%
(Class A 5.3%, Class B
7.3%)◼ Utilize support fromsponsors and sub-sponsors(※） The ratio of the 14th fiscal period of the relevant property to the sale price is rounded to the first decimal place.

23

４． Progression Status of Mid-Term Plan (3)9th asset replacement◆ Plan to sell properties which are relatively unprofitable and with high volatility in occupancy rates, and realize gain-on-sale.
◆ Expecting to acquire preferred equity securities backed by a student residence asset which is anticipated to have improved profitability in the
future (Right of first refusal already obtained).

Assets with high probability of acquisition

Transferred Asset
Urban Park Gokokuji(Residence)

Preferred Equity Securities＜Underlying Asset＞ ： HAKUSAN HOUSE（student residence）

Asset nameSubject Period

From Mar 16, 2023 to Jul 31, 2023

Desired purchaseprice of the Preferred
Equity Securities

1,510 million yen or more

Assumed return

4% per annum (if preferred securities loan transaction is executed)

Property nametransfer dateAug 31, 2023 or such otherdate to be separately
agreed by SAR and theseller.

sales price1,800 million yen

Appraisal value

1,570 million yen

Book value

1,494 million yen

Gain of Sales

271million yen

NOI Yield

3.7 ％(※)

erification for
maximizing
unitholders' profit⁃ Various verifications includingchange of use with total
renovation and measures toimprove profitability throughredevelopment⁃ Projected increase in life-cycle
costs in case of continuous
holding⁃ Potential for returns tounitholders through realizationof gains on sales

Effects of asset replacement<Sale of Assets>◼ Realize gains-on-saleApproximately 271 million yen◼ Dispose of assets with highly
volatile occupancy rates which
are more than 30 years sinceconstruction.
<Purchase of Assets (assumed) >◼ Return for the near term to bestableAnnual rate of 4%◼ Anticipating improvement ofrevenues in conjunction with
the increase in international
students from abroad.

(※） The ratio of the 14th fiscal period of the relevant property to the sale price is rounded to the first decimal place.

＜Structure Plan＞
GSA JP Project 1 TMK【Borrowing】【Preferred Investments】
HAKUSANHOUSE

GSA JP Project 1GK1,510million yen or
more【Specific Investments】

Execution of preferential
negotiation agreement for
acquisition of preferred
securities

SAR

Receive Letter of IntentReceipt ofLetter of Intent Borrowing andlending fee for investment
securities: 4% per annumStar Asia Tatemono GK

24

４． Progression Status of Mid-Term Plan (4)Utilization Policy of retained earnings◆ Leverage retained earnings including negative goodwill to (1) counteract temporary reductions in revenue (defensive use) and (2) handle issues (loss from removal of buildings,
rent downtime) with redevelopment, etc. of portfolio assets (offensive use), and maintain stable distributions

Retention of gains on
disposal through continuous
asset replacements

Negative goodwill
from merger

Total retained earnings: JPY 8.88 bn(As of the end of the FP ended 1/2023)

Use retained earnings to stabilize distributions
Defensive
Dealing with the temporary reductions in revenue
due to PO costs, the impact of COVID-19, etc.
13FP Actual(ended 7/2022)
14FP Actual(ended 1/2023)
15FP Forecast(ended 7/2023)
16FP Forecast(ended 1/2024)

Drawdown of retained
earnings

JPY 80 mn
Drawdown of retained
earnings

JPY 80 mn
Drawdown of retained
earnings

JPY 0 mn
Drawdown of retained
earnings

JPY 0 mn

DPU

+JPY 46

Offensive
Dealing with the redevelopment of portfolio assets, etc.
Examination ofredevelopment

Specificplanning / startof construction

Construction /completion

Postredevelopment
operation

DPU+JPY 44
Planning capital
expenditures which
will directly connect
to increase inrevenues

BeforeAfter

Start ofredevelopment
Existing property

Redevelopment

Demolition of existing buildings /loss from removal of buildings

Stabilization of distributions per unit
through the use of retained earnings

Completion of
new buildings
New operation phase
Rent downtime during theredevelopment period

Stabilization of distributions
through the use of retained earnings
25

４． Progression Status of Mid-Term Plan (5)Continuous Sponsor Support by Star Asia Group for the Growth of SAR
Star Asia Group’s initiatives for development projects◼ Star Asia Group will continue to engage in development projects
Student residencesdeveloped by GSA Star Asia

Residential development
project in Kyoto city (Note 1)

Polaris Holdings Co. Ltd.- Approach to Hotel Business◼ Polaris is making efforts to renovate its revenue
structure by leveraging on the real estate investment
management know-how of Star Asia Group for hotel
operations.
◼ As the owner and operator of the major
accommodation-focused hotel brand “Red Planet”,
it has signed memorandums to acquire shares of
the corporate group companies which it holds andoperates.
◼ Due to this, the number of hotels operated by the
Polaris Group is 44 buildings and 8,075 rooms.

Urban Park
Kyoto Nishishichijo

KAMIKITA HOUSE

HAKUSAN HOUSE◼ By collaborating with Star Asia Group, it is stably expanding the number of hotels under its
operation, through operator changes and rebranding the hotels to its own brand “KOKO
HOTEL”.

Properties managed by Star Asia Group (Note 2)◼ Star Asia Group operates many hotels for which revenue is expected torecover in future

Total appraisal value (Note 3)
Land,
3.8%

Office, 9.7%

Asset type

Hotel,
54.2%

JPY 205.7bn

Residence,
28.1%

Logistics,
4.2%

Location

Tokyo,
Other
58.6%
41.4%
(as of January 31, 2023/ based on appraisal value)

Expecting for expansion of SAR’s pipeline26

４． Progression Status of Mid-Term Plan (6)Amendment to the Management Guidelines◆ Given the expansion of asset size, the degree of risk tolerance of the portfolio has increased.／ Mainly consolidation of investment areas◆ There are no change main investment policies①Prioritized and concentrated investments in the Tokyo Area、②diversifying asset type
③Invest mainly in middle-sized assets

Concept of investment target areas<After amendment><Before amendment>
Area
Classification

Specific Investment Target Areas

Investment Ratio

Tokyo 23 wards, Kawasaki-shi, Yokohama-shi

In principle,
70 % or more

Tokyo Area
Tokyo, Kanagawa, Saitama, and Chiba prefectures
Greater Tokyo
Area

Main cities in Suburban Tokyo (other than the 23
wards), Kanagawa prefecture (excluding Kawasakishi and Yokohama-shi), and Saitama prefecture.

Osaka Area

Osaka-shi, Osaka prefecture（※）

Nagoya Area

Nagoya-shi, Aichi prefecture（※）

Fukuoka Area

Fukuoka-shi, Fukuoka prefecture（※）

Sapporo Area

Sapporo-shi, Hokkaido prefecture

Other ordinancedesignated cities

Sendai-shi, Miyagi prefecture,Niigata-shi, Niigata prefecture,Kyoto-shi,
Kyoto prefecture,Sakai-shi, Osaka prefecture,Kobe-shi, Kobe
prefecture,Hiroshima-shi, Hiroshima prefecture
Kitakyushu-shi, Fukuoka prefecture

Area Classification

Tokyo, Kanagawa, Saitama, Chiba
prefectures

Tokyo Area

Major
Metropolitan
Areas
In principle, lessthan 30%

Specific Investment Target Areas

Osaka Area

Osaka-shi, Osaka prefecture（※）

Nagoya Area

Nagoya-shi, Aichi prefecture（※）

Investment
Ratio
In principle,
70 % or more

In principle, lessthan 30%

Fukuoka Area Fukuoka-shi, Fukuoka prefecture（※）
Ordinance-designated cities other than the above
investment target areas

In principle,
less than 10%※ For residences and logistics facilities, also includes the neighboring areas
For logistics facilities, areas other than the above investment target areas can be invested
in, if it is determined that tenant demand will be high in the mid- to long-term

Concept of investment target asset types<Before amendment>
Area Classification

Area Type
Office, RetailTokyo Area◼

No restrictions on investment in asset types based on previous area classifications◼

In principle, the following asset types will be categorized, with each asset typeaccounting for no more than 50% of the portfolio•(1) Office (2) Retail (3) Residence (4) Logistics (5) Hotels (6) Student residences (7)Land with leasehold interest in each of the above asset types•(7) Conforms to the asset type of the building on the land•

Investment in anonymous associations and mezzanine loan investment are based on
the asset type of the subject property.

Residence, Logistics, Hotel Student residenceGreater Tokyo Area

Office, Retail

Osaka Area

All asset types

Nagoya Area

All asset types◼

However, the following exceptions are madeFukuoka Area

All asset types•

Acquisition by merger or in bulk•

Possible to invest in areas other than those mentioned above, taking into consideration
the location characteristics of the logistics facility (nearest consumption area, access totransportation infrastructure facilities such as airports, ports, and highway interchanges,
etc.)

Sapporo Area

All asset types

Other ordinancedesignated cities

All asset types

27

４． Progression Status of Mid-Term Plan (7)The continuous implementation of corporate action in pursuit of the maximization of unitholders’ interests◆ SAR has continuously implemented Active Management initiatives since IPO all designed with the intent of maximizing unitholder value.
As a result of these strategies, SAR unit price has consistently outperformed the TSE REIT index since.

Active management and investment unit price performance since listing
IPO
April 20, 2016日(yen)

1st asset
replacement
December 5, 2016

1st follow-on
offering
March 17, 2017
2nd asset
replacement
February 28, 2017

3rd asset
replacement
July 23, 2018

2nd follow-on
offering
January 12, 2018
4th asset
replacement
August 21, 2018

3rd follow-on
offering
August 21, 2018
5th asset
replacement
March 2, 2020

MergerAugust 12, 2020
6th asset
replacement
October 5,2020

4th follow-on
offering
August 2, 2021
7th asset
replacement
March 2,2020

5th follow-on
offering
August 21 2022
8th asset
replacement
February 1,2023

70,00065,00060,00055,00050,00045,00040,00035,00030,000SAR

TSE REIT

25,00020,000*The closing price of TSE REIT index as of the date of listing of SAR (1,887.75) has been converted based on the closing price of SAR’s investment units on the same day of 98,300 yen.
Furthermore, SAR has conducted a 2- for-1 investment unit split on the reference date of July 31, 2020. The investment prices prior to such split are also indicated split in half.

28

５．Initiatives on ESG

29

５. Initiatives on ESG (1)Recent Topics regarding ESG Initiatives and ESG Promotion System◆ As a part of ESG related initiatives, participated in the 2022 GRESB Real Estate Assessment (Note 1), and acquired 3-Star / Green Star
◆ In order to further enhance ESG related initiatives, strengthen cooperation with the sub-sponsors (Nippon Kanzai and Tokyo Capital Management)

ESG promotion system◼ The Asset Manager’s ESG promotion system centered on the Sustainability
Promotion Division (Primarily involving E (Environment) matters)
The Asset Manager’s
Sustainability
Promotion Division
Executive officer incharge of sustainability
General Manager of
Sustainability
Tetsuya Makino■ESG initiatives• Setting of goals primarily focused on E
(Environment), process management, andresult verification• Participation in GRESB Real Estate
Assessment, and acquired 3 Star
■Optimization of capital expenditures andrepairs expenses• Examination of capital expenditures andrepair expenses• Selection of equipment and materials withconsideration for impact on revenue
pursuant to ESG Policy and Sustainablepurchase policy

Nippon Kanzai(Sub sponsor)
Supports SAR to achieve numerical targets(provides advice related to developing various
data and measures to reduce environmental
burdens)<E (Environment) related support>

GRESB Real Estate Assesｓment＜GRESB Real Estate Assesｓment＞◼ Star Asia Investment Corporation (“SAR”) participated in the GRESB Real
Estate Assessment in 2022, and acquired “3 Stars” rating.
◼ Furthermore, SAR obtained the “Green Star” which indicates that SAR is aparticipant which excels in both the “Management Component” which assesses
the policy and organization structure for promoting ESG as well as the“Performance Component” which assesses environmental performance andtenant engagement of properties owned.
◼ SAR also received the highest “A Level” for the GRESB Public Disclosure,which assesses the width of our ESG disclosure.

■New Business & Corporate Branding
Dept.
• Institution with certification for CASBEE• Environment-related consulting services■East Japan Engineering Management
Center■West Japan Engineering Management
Center• Energy-related services• Environmental assessment services

Tokyo Capital Management (Sub sponsor)
TCM helps developing long-term repair plans for SAR’s portfolio
assets together with Nippon Kanzai

Aim to achieve E (Environment) related goals＜Initiatives on GRESB Real Estate Assesｓment ＞
Develop and organize data, led by the Sustainability Promotion Division
and with the cooperation of Nippon Kanzai Group who is a sub-sponsor.
We recognize that the purpose is not to receive high evaluation itself, butthat it is important to make efforts towards achieving a better
environment, a better society, and building a better governance structure.
30

５. Initiatives on ESG (2)(Environment) related Numerical Goals and their Achievement Status◆ As the occupancy rates of hotels recovered, both GHG emissions and energy consumption slightly increased compared to fiscal 2020, but decreased compared to fiscal
2019(Base year)◆ We will aim for continued reduction by considering introducing highly efficient equipment and low carbon equipment at times of facilities renovation and renewal

E (Environment) Related Numerical Objectives and Actual Performance
GHG (Note 1)
Monitoring item

Base year(2019)

Unit

2020
Actual

GHG emissions

t-CO2

Scope 1t-CO2

1,968.71

Scope 2t-CO221,185.34
0.05712-

GHG emission intensity (Note 2)
Reduction rate

Crude oil equivalent usage
Monitoring item

23,154.05

2

t-CO2/m%

Unit

Base year(2019)

2021
Actual

16,804.50

Target year
(2030)

20,130.43-

1,129.44

1,672.17-

15,675.06

18,458.26-

0.040570.04097

0.05140-29.0%-28.3%-10.0%

2020
Actual2021
ActualTarget year
(2030)

Crude oil equivalent usage amountkL

11,220.81

9,156.34

11,234.60-

Crude oil equivalent usage per unit

kL/m2

0.02768

0.022100.02286

0.02491--20.1%-17.4%-10.0%

Reduction rate%

Energy Consumption
Monitoring item

Unit

Energy Consumption
Energy Consumption per unit
Reduction rate

Water Consumption
Monitoring item
Clean water usage
Clean water usage intensity
Reduction rate

Waste
Monitoring item

Base year(2019)

2020
Actual2021
ActualTarget year
(2030)

MWh

44,560.98

36,362.39

44,615.75-

MWh/m20.10992

0.087780.09080

0.09893--20.1%-17.4%-10.0%

%

Unit
㎥
㎥/m2

Base year(2019)
329,687.35

Unit

2020
Actual2021
ActualTarget year
(2030)

220,847.18

255,933.91-

0.53310.5209≦ 0.8133-- 34.4%- 36.0%±0%Base year(2019)

2020
Actual2021
ActualGoal: 10% of reduction frombase year by 2030
Reduction rate：17.4%

0.8133%

Goal: 10% of reduction frombase year by 2030

Target year
(2030)

Waste emissionst

2,693.27

1,656.50

3,164.05

Coverage rate

%

69.1%

65.1%

70.4%

-

Waste emissions intensity

t/m2

9.61

6.14

9.14

≦ 9.61

Reduction rate%-

- 36.1%- 4.9%±0%31

５. Initiatives on ESG (3)Initiatives for E (Environment) and S (Society)◆ In August 2022,”CASBEE Real Estate Certification” was acquired for ”abeno nini (retail)”./ Green loan was executed for the purpose of acquiring this property.
◆ As an initiative for S (=Society), in the fiscal year 2021, a tenant satisfaction survey has been conducted in wider scope. Considered ways to reflect the resultsof the survey in management and operations.

Receipt of environmental certification (as of Jan 31, 2023) and goals◆ Signing of green lease contracts

Obtained
Asset
type

Total floor area

Baraki Logistics

Logistics

12,471.50 m2

Honmachibashi Tower

Office15,407.83 m2

La Park Kishiwada

Retail

65,663.02 m2

Urban Park Tokiwadai
Koen

Residence

15,708.08 m2

Urban Park Mitsuike Koen

Residence

10,918.37 m2

Iwatsuki Logistics

Logistics

29,729.72 m2

Seishin Building

Office7,624.66 m2

Seiyu Minakuchi

Retail31,829.71 m2★★★

Urban Center Hakata

Office3,566.56 m2★★

Urban Park
Miyamaedaira (Note 5)

Residence

2,039.17 m2

Rank S

Higashi-Kobe Center Building

Office25,740.46 m2

Urban Park Daikanyama

Residence

8,261.29 m2

abeno nini (retail)

Retail

4,866.82 m2

Property name
★★★

DBJ
Green
Building
Certification★★

(Note 2)

Ratio
(Note 1)

(Note 3)

CASBEE
Real Estate
Certification(Note 4)◼ Established policy for green lease agreement and added green lease clauses
for 89 (+30)office tenants, 25 (+8)retail tenants, 6(+3) residence tenant, 6(+3)
logistics tenants, and 2 hotel tenants.（16.7 % of leasable area）◼ SAR plans to add the same clause to other properties

128 tenants

Total leased area

77,553.58㎡

34.6 %

Initiatives for S (Society)◆Initiatives for employees★

BELS
Certification

Signing of green lease contracts (Note 6)

1.0 %◆Displayed poster for Human Rights Week
7.1 %Rank A

Total計Goals：50％（2026）◼ Diversity & inclusion (one out of five directors is female)◼ Conducts employee satisfaction surveys regularly◼ Introduced various systems in order to care for the health and comfortableness of
employees• Promotion of teleworking and staggered commuting, superflex• Maternity leave, childcare leave, nursing care leave, and reduced working hours

233,827.19 ㎡ 42.7 %◼ Displayed posters at held properties for the “74th Human
Rights Week” promoted by the human rights protection
institute of the Ministry of Justice.

◆Tenant satisfaction surveys◼ Tenant satisfaction surveys are conducted periodicallyin order to enhance tenant satisfaction32

５. Initiatives on ESG (4)GovernanceSame boat investment

Calculation Formula for Asset Management Fees

◼ Aligning the interests of the Sponsor Group with those of the unitholders
by holding 9.7% of the investment units of the Sponsor Group (as of Jan
31, 2023)◼ Members of the Asset Manager also hold investment units◼ Aim to further align interests with those of unitholders and increase the linkage torevenues from properties under management.

Star Asia Group(as of Jan 31, 2023)◼ Star Asia Group has continued to holdinvestment units since the time of listing, whichstrong supports the growth of SAR.
◼ Star Asia Group’s founders also as individuals
hold investment units.

＜Founder of Star Asia＞

Number of units
held in same-boat
investment:

186,832 units

Calculation Formula

13FP

14FP

Management fees I

Total valuation amount of managed assets x
0.2% (upper limit)

132,779 thousand yen

145,318,thousand yen

Management fees II

NOI × 7.5% (upper limit)

255,805 thousand yen

279,092,thousand yen

Acquisition price × 1.0％(upper limit) ※4,000 thousand yen

15,140 thousand yen

Transfer fee

Assignment price× 1.0％(upper limit) ※－－Merger fee

Valuation amount of held assets× 1.0％
(upper limit) ※－－Acquisition fees

◼ Other fees※： 0.5% if SAR transact with its interested parties.

Ownership:

Decision-making process◼ Implement decision-making with high transparency, compliant with laws and regulations

9.7 ％◼ Maintain high ethical standards and execute operations as a steward of investors’ funds

Department
ProposalCompliance officer

Management team of the Asset Manager◼ Hold SAR’s units through the employee unit purchase plan
◼ Indicates a high level of commitment by the management team to thegrowth of SAR.
◼ Star Asia Group commences cumulative investment-units investment
program.
◼ Akiko Kanno, Director and General Manager of the Finance Management
Department, was approved as SAR’s substitute executive officer at the
October 2021 unitholders’ meeting

Review and approval

ReturnInvestment Committee (including external members)
Review and resolution

RejectCompliance Committee (including external members)
Review and resolution

RejectBoard of directors
Review and resolution

RejectItems that do not need to be
discussed at the Compliance
Committee

SAR’s Committee
Review and approval

Disapprove

Items that need to be discussed at
the Compliance Committee33

５. Initiatives on ESG (5)GovernanceStar Asia Group’s Code of Conduct
Star Asia, the sponsor of Star Asia Investment Corporation, is a non-listed independent investment management group which invests mainly inJapanese real estate-related assets and whose main goal is supplying investors with excellent returns
Star Asia Investment Corporation and Star Asia shall share the same long-term vision in accordance with the Star Asia Group’s Code of Conduct,shall be a leading Real estate investment management group in Japan and shall persistently endeavor to continue to be such
The Code of Conduct is as follows:1

Client FirstWe are rewarded only when we
consistently meet and exceed ourinvestor clients’ expectations for the
mandates they have given to us.

5

Collaborative
andCooperative Culture

We succeed only when we work
together by fully utilizing our collective
strengths in a cooperative manner toserve our investor clients. The group’s
performance always exceeds the sum of
our individual performances.

2

Highest EthicalStandards andIntegrity

We always abide by the highest ethicalstandards and integrity. Unethicalactions by an employee could easily
destroy the group’s long-standing
reputation and trust.

6

Adaptability

We stay nimble, proactive and critical,
allowing us to adjust quickly as themarket environment changes in order tocontinue to be a successful leader in themarket where we do business.

3

Creativity

We utilize our experience, persistence,and creativity to identify and monetize
investment opportunities which may not
be immediately apparent to ourcompetitors.

7

Meritocracy

We reward our employees for their
specific personal performance as well as
their contribution to the group and toinvestor client performance.

4

Respect for Others

We treat our investor clients, employees,
trade counterparties, and vendors withthe utmost respect, and always strive to
be trustworthy partner.

8Endless PursuitofExcellence

We will tirelessly pursue excellence not
only for our investor clients but also for
ourselves.

34

６．Appendix

35

About Star Asia Group
Founded by Taro Masuyama and Malcolm F. MacLean IV in 2006, Star Asia Group is an independent fund management company focusedon Japanese real estate and real estate related assets (i.e., debt, equity, property, securitized assets, corporations, etc.)

Taro Masuyama
Co-Founder andManaging Partner

Malcolm F. MacLean IV
Co-Founder andManaging Partner➢

Since its founding, Star Asia Group has invested over JPY1,089 billion and has current assets under management of around JPY453
billion1.

➢

Star Asia Group has 588 officers and employees2 with over 55 professionals in finance, investment and real estate area in primarilyin Japan and a few in the United States➢Star Asia Group’s partners and employees share a long-term perspective and always operate under our Guiding Principles which
continuously drive the group to become and remain one of the leading real estate investment management firms in Japan➢

Star Asia Group’s strong track record and long-term partnership approach with our investors have been integral in attracting
significant capital from sophisticated global investors, including large U.S. university endowments and foundations, Japanese andEuropean pension funds, U.S. and Asia based family offices as well as other global real estate investors➢

Star Asia Group is committed to its disciplined Investment Philosophy with a single goal of meeting and exceeding our client’s
expectations for the mandates we are given

Star Asia Group
Listed J-REIT
Asset manager

Star Asia
Investment
Management Co.,Ltd.

Star Asia
Investment
Corporation

Private FundManagement

Asset Management

Star Asia
Management:• Registered
Investment Advisor
with the US SEC• Manages private
funds including its
flagship Star Asia
Japan Special
Situations funds• Sponsors andsupports other group
entities providing
strategic and technicaladvice as well as
leadership resourcesStar Asia Asset Advisors:• Registered for Financial
Instruments Business (2nd
Financial Instruments,
Investment Advisory, Agency
and Investment Management*)
with Kanto Financial Bureau

Property Development

Star Asia Sogo
Kaihatsu:• Provides pipeline for
GSASA, SAIC andPolaris Holdings(*) Invest Management Businessregistered as of December 2021

Purpose Built Student
Accommodation
Operation

Publicly Traded
Hospitality Operation &Development Company

GSA Star Asia:• 50/50 JV with GSA
Group, a pioneer in
PBSA and operates in
8 countries includingUK• Develops andoperates PBSA in
Japan

Polaris Holdings (TSE:3010):• Sponsored by Star
Asia Group• Develops andoperates hospitality
properties with 29
hotels and 5,022
rooms currently undermanagement acrossJapan (as of
September 2022)• Provides asset management,
property management andbrokerages services• Warehouses properties for
SAIC
SAGL Advisors K.K.

Credit Investment

K.K. Star Asia
Finance:• Provide mezzanine
non-recource financeto 3rd party sponsored
SPCs.
• Registered Money
Lender and a Tax
QII.

• JV with Global
Link Management Inc., anasset management company.
(*) Registered Investment Advisory(June 2021)

Star Asia Group with expanding business provides strong support to SAR
1.
2.

As of September 2022. US$ = JPY144.74.
As of September 2022. Includes officers and employees of affiliated entities not shown above.

36

Investment Philosophy of Star Asia GroupThe Group intends to strictly adhere to its investment philosophy, and to meet the expectations of investors andcontinue to exceed such expectations. This is our largest objective
1

Research Focus

We believe that consistent outperformance canonly be achieved when investment opportunities
identified through our rigorous origination process
are validated
againstthe comprehensive
understanding of the ever-changing market
environment. Government policies, macroeconomic
environment, state of capital markets, trends in
demographics,
realestatesupply/demand
dynamics, status of the real estate market cycle,
outlook and appetite by potential tenants, as wellas anticipated behavior of other market participants
are only a few of the critical inputs we analyze. In
order to formulate and continually update ourunderstanding of the current market environment,
we run iterative processes of gathering feedback
from our day-to-day investment and asset
management activities, which are supplemented byvarious third-party research reports and data that isfurther investigated and verified by us to generate
our unbiased view.

4

Specialization

We believe deliberate specialization and a flatorganization allow us to identify, properly structure,and dependably execute attractive, but often
complex,investment
opportunities.
This
specialization leads us to more predictable successand sets us apart from our competitors. Our seniorprofessionals have years of hands-on experience
in real estate deal sourcing, underwriting,structuring, asset management, financing, capital
markets, and securitization. Star Asia’s seniorprofessionals have developed deep-rooted local
relationships over multiple real estate cycles, andhave executed some of the most creative andcomplex investment opportunities in the market.

2

Market Inefficiencies

Unlike highly efficient foreign exchange, interest
rate and public equity markets, the Japanese andother Asian private real estate markets are
inherently inefficient. Although Tokyo is the world’s
largest metropolis in terms of population(approximately 35 million), GDP, and real estate
capital values, in our opinion, it is significantly lessefficient than the U.S. or U.K. markets. The
Japanese real estate market has high barriers-toentry, asymmetric information flows, a lessdeveloped securitization market, and a limited
universe of well-capitalized opportunistic market
participants, which together creates market
inefficiencies. We believe that thorough robust
analysis and deep local relationships combinedwith our significant hands-on experience allow us
to identify and capitalize on these market
inefficiencies that are not obvious to ourcompetitors.

5

Risk Control

Our objective is to achieve consistent and superiorrisk-adjusted returns by only assuming wellcalculated risks. When a potentially attractive
investment opportunity is identified, we examine all
the risks associated with the potential opportunity
through our rigorous review process. We thennegotiate with the counterparties to determine afair risk-sharing arrangement while formulating
structural solutions to eliminate or mitigate otherrisks, where possible. Concurrently, we conduct
quantitative and qualitative analyses to evaluate
the viability of the potential investment opportunity
against our strict underwriting criteria.

3

Maximizing and Unlocking
Value

The real estate properties that we evaluate forinvestment are typically not operated to theirmaximum potential at the time of our investment.
Some owners are not professional real estate
investors, failed to invest necessary capital
expenditures, and/or had poorly managed leasing
strategies. Some real estate properties havecertain compliance issues that can be cured withlimited cost and time, or have potential to generatehigher net operating income if repositioned or
repurposed properly. We utilize our own
experience along with technical advice from thirdparty professionals, as necessary, to formulate andexecute the optimal asset management, capital
expenditures, renovation, and repositioning plans.
Implementation of these plans will maximize andunlock the property’s intrinsic value in the mostefficient manner from a cost and time perspective.

6

Dependability, Transparency
and Decisive Action

Our trade counterparties know that they candepend on us when they need to sell their realestate related assets quickly, discreetly and/or
through a complex structure that others may not beable to handle or understand. We are always
candid and transparent by clearly explaining ourrequirements up front including expected deal
economics, our strict due diligence process, andthen work tirelessly and creatively to meet thecounterparty’s specific objectives and timing. Ourflat organization and highly efficient, decisionmaking process allows us to be very flexible,
tactical and decisive. This philosophy andexecution style are valued by our trade
counterparties who repeatedly bring attractive
investment opportunities that reward our clientswith outsized returns.

37

Status of Unitholders
at the End of 14th Fiscal Period ended January 2023
List of major unitholders (Top 10)

Number of investment units by attribute: Total 1,921,689 units
End of 13FP

End of 14FP

Unitholder nameCategory
No. ofinvestment units

No. ofinvestment units

Ratio

Ratio

Individual

426,904

23.9%

489,943

25.5%

Financial institution

522,99729.2%

629,81632.8%

75,701

4.2%

69,783

3.6%

Domestic
corporation
Foreign
Securities company

Total

688,657

38.5%

663,050

34.5%

75,1304.2%

69,097

3.6%

1,789,389

100.0%

1,921,689

100.0%

Number ofinvestment
units

Holdingratio

1

The Master Trust Bank of Japan, Ltd.
(Trust account)

228,672

11.9 %

2

Custody Bank of Japan, Ltd.
(Trust Account)

216,74811.3 %3

NORTHERN TRUST CO. (AVFC) RE UKUC
UCITS CLIENTS NON LENDING 10 PCT
TREATY ACCOUNT

82,3684.3 %

4The Nomura Trust and Banking Co., Ltd.
(Trust Account)

81,847

4.3 %5Star Asia Capital Ⅰ LLC

46,598

2.4 %5Star Asia Capital Ⅱ LLC

46,598

2.4%

5Star Asia Capital Ⅲ LLC

46,598

2.4 %5Star Asia Capital Ⅳ LLC

46,5982.4 %

9STATE STREET BANK AND TRUSTCOMPANY 505001

45,474

2.4 %10

SSBTC CLIENT OMNIBUS ACCOUNT

28,351

1.5 %

869,852

45.3 %

Number of unitholders by attribute: Total 28,965
End of 13FP

End of 14FP

Category
No. ofunitholders

No. ofunitholders

Ratio

Ratio

25,55897.3%

28,169

97.3%

42

0.2%

48

0.2%

Domestic
corporation

353

1.3%

413

1.4%

Foreign

293

1.1%

309

1.1%

27

0.1%

26

0.1%

26,273100.0%

28,965100.0%

Individual
Financial institution

Securities company

Total

Total
Star Asia Capital Ⅰ～ⅣLLC are Sponsor Group.

38

Change in business results(Unit: million yen)
9FP (ended Jul.
2020) actual

10FP (ended Jan.
2021) actual

11FP (ended Jul.
2021) actual

12FP (ended Jan.
2022) actual

13FP (ended Jul.
2022) actual

14FP (ended Jan.
2023) forecast（※1）

14FP (ended Jan.
2023) actualComparison with
forecast

3,314

5,648

5,536

5,890

6,060

6,363

6,463

99

Office rent

1,163

1,895

1,807

1,900

1,974

2,056

2,036

△20

Retail rent

-

848

790

842

847

1,035

1,038

3

Residence rent

512

889

1,023

1,152

1,215

1,216

1,225

9

Logistics rent

887

974

909

910

910

914

914

0

Hotel rent

445

423

424

425

426

503

537

34

Other

306

616

582

660

686

637

710

72

741

1,550

1,556

1,629

1,796

1,804

1,812

8

2,573

4,097

3,980

4,261

4,263

4,559

4,650

91

432

628

633

682

697

734

743

8

2,141

3,469

3,347

3,579

3,565

3,824

3,907

82

Mezzanine

25

24

24

22

28

24

22

△1

TK distribution

7

5

-

46

-

-

-

-

648

993

-

-

-

-

-

-

-

19

-

-

-

-

-

-

690

1,096

532

560

546

585

580

△5

2,131

3,376

2,838

3,087

3,047

3,263

3,349

86

3

4

3

1

2

-

1

1

Lease business revenue

Expenses related to rent
business(Depreciation is excluded)
NOI
Depreciation
Rent revenues/expenses

Gain on sale of real estate
property
Loss on sales of real estate
property
SGA
Operating income
Non-operating income

278

469

434

571

489

576

568

△7

1,857

2,911

2,407

2,517

2,560

2,686

2,782

95

-

8,891

-

-

1,857

11,801

2,407

2,516

2,559

2,686

2,781

95

Cash distribution per unit

3,436 yen

1,676 yen

1,462 yen

1,478 yen

1,476 yen

1,476 yen

1,491 yen

15 yen

FFO per unit※2

3,033 yen

1,531 yen

1,815 yen

1,787 yen

1,820 yen

1,780 yen

1,834 yen

54 yen

140

9,135

9,095

8,967

8,886

8,735

8,802

66

Non-operating expenses
Ordinary income
Extraordinary income
Net income

Balance of Internal reserves-※3（※1) announced in the 13th FP financial briefing report (2022/9/13). （※2) The 10th FP FFO per unit has been calculated excluding gains from negative goodwill. （※3）The balance of internal reserves is calculated
as the total of the temporary difference adjustment reserve plus unappropriated retained earnings as of the end of the period, minus distributions of profits for the period.

39

Balance Sheets
13th fiscal period

14th fiscal period(As of July 31, 2022) (As of January 31, 2023)

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Non-current assets
Property, plant and equipment
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment
Intangible assets
Leasehold rights in trust
Total intangible assets
Investments and other assets
Investment securities
Long-term prepaid expenses
Leasehold and guarantee deposits
Other
Total investments and other assets
Total non-current assets
Deferred assets
Investment corporation bond issuance costs
Investment unit issuance costs
Total deferred assets
Total assets(Unit: thousand yen)
4,265,178
8,075,474
137,598
196,009
9,011
12,683,272

3,488,637
8,549,954
147,713211,249
181,189
7,000
12,585,743

114
(100)
14
53,471,574(5,441,732)
48,029,841
21,640(5,856)
15,784
119,343(28,905)
90,437
100,966(30,688)
70,278127,283,507
175,489,864

114
(114)
0
56,299,699(6,169,727)
50,129,971
25,348(6,646)
18,702
163,565(35,247)
128,318
125,782(39,013)86,768140,397,333
1,282
190,762,377

4,082,300
4,082,300

4,082,300
4,082,300

800,000
337,433
10,35945,353
1,193,146
180,765,311

400,000
330,923
10,359533,969
1,275,251
196,119,929

12,58327,37539,959193,488,543

11,56349,37060,933208,766,606

14th fiscal
13th fiscal period
period(As of July 31, 2022) (As of January
31, 2023)
Liabilities
Current liabilities
Operating accounts payable
Current portion of long-term borrowings
Accounts payable - otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities
Non-current liabilities
Investment corporation bonds
Long-term borrowings
Leasehold and guarantee deposits received
Leasehold and guarantee deposits received in trust
Other
Total non-current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus
Unitholders’ capital surplus
Voluntary reserve
Reserve for temporary difference adjustment
Total voluntary reserve
Unappropriated retained earnings (undisposed loss)
Total surplus
Total unitholders’ equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

662,398
16,390,000
495,977
59,099605
234,089

906,069
15,630,000
539,516
77,453605
47,405

974,728
36,80418,853,703

1,019,524
34,89918,255,474

1,000,000
72,250,000
5,187
5,559,508
16,75978,831,455
97,685,158

1,000,000
80,210,000
5,880
5,840,152
87,056,032
105,311,507

59,115,701

66,123,367

25,132,218

25,132,218

8,713,411
8,713,411
2,813,756
36,659,386
95,775,087

8,624,499
8,624,499
3,043,461
36,800,179
102,923,546

28,29728,29795,803,384
193,488,543

531,551
531,551
103,455,098
208,766,606

40

Statement of Income(Unit: thousand yen)
13th fiscal period
From: February 1, 2022
To: July 31, 2022

14th fiscal period
From: August 1, 2022
To: January 31, 2023

5,611,196
449,218
28,525

5,995,567
467,828
22,857

Total operating revenue
Operating expenses
Expenses related to rent business
Asset management fee
Asset custody and administrative service fees
Directors’ compensations
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Reversal of unpaid distribution
Interest on refund
Gain on donation of non-current assets
Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds
Borrowing related expenses
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance costs

6,088,939

6,486,253

2,494,593
392,584
38,4282,400
113,213
3,041,220
3,047,719

2,556,151
424,410
40,5282,400
113,204
3,136,696
3,349,557

55
1,470
262
516
2,305

56
1,476
1
1,534

338,087
3,500
140,164
1,020
6,843

372,916
3,500
178,507
1,020
12,611

Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes - current
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

489,615
2,560,409
2,560,409
605
605
2,559,804
253,951
2,813,756

568,555
2,782,535
2,782,535
605
605
2,781,930
261,530
3,043,461

Operating revenue
Rental revenue
Other lease business revenue
Other revenue

41

Portfolio List (as of Jan 31, 2023)< Property>
Property nameLocation

AcquisitionPrice(mill)

Appraisal
Investment
value atratio
end of(%)
13 FP(mill)Appraisal
NOI yield(%)(＊)

Property nameLocation

AcquisitionPrice(mill)

Appraisal
Investment
value atratio
end of(%)
13 FP(mill)Appraisal
NOI yield(%)(＊)

1.5
3.1
0.9

4.7
5.1
6.8

Minato Ward, Tokyo

2,045

2,930

1.0

4.4

Urban Park Daikanyama

Shibuya Ward, Tokyo

6,315

10,1003.2

4.8

Urban Park Namba

1,490

1,550

0.8

5.0

Shibuya Ward, Tokyo

2,042

3,290

1.0

5.6

Urban Park Gokokuji

1,460

1,570

0.7

4.2

Yokohama City,
Kanagawa
Fukuoka City,
Fukuoka

6,320

8,390

3.2

4.9

Urban Park Kashiwa

Osaka City, Osaka
Toshima Ward,Tokyo
Kashiwa City, Chiba

1,186

1,200

0.6

4.9

2,286

3,140

1.2

6.4

1,550

1,720

0.8

5.7

Nihonbashi Hamacho Park Building
Amusement Media Gakuin
HonkanHigashi Kobe Center Building
Amusement Media Gakuin
ShinkanSeishin Building

Chuo Ward, Tokyo

1,450

1,500

0.7

4.5

1,167

1,180

0.6

4.5

Shibuya Ward, Tokyo

2,580

2,790

1.3

4.0

1,810

2,170

0.9

4.8

Kobe City, Hyogo

7,440

7,320

3.8

5.4

Urban Park Gyotoku

Suita City, Osaka
Suginami Ward,Tokyo
Yokohama City,
Kanagawa
Ichikawa City, Chiba

1,430

1,600

0.7

4.7

Shibuya Ward, Tokyo

1,020

1,240

0.5

4.0

Shiroi Logiman

Shiroi City, Chiba

2,470

2,520

1.3

5.7

Urban Park Sekime

Osaka City, Osaka

2,150

2,460

1.1

5.3

Urban Park Imazato

Osaka City, Osaka

Urban Center Kanda Suda cho

Chiyoda Ward, Tokyo

993

1,100

0.5

5.4

Urban Park Yoyogi

Urban Center Kanda

Chiyoda Ward, Tokyo

Shibuya Ward, Tokyo
Yokohama City,
Kanagawa
Yokohama City,
Kanagawa
Sumida Ward, Tokyo
Kawasaki City,
Kanagawa
Kawasaki City,
Kanagawa
Yokohama City,
Kanagawa

1,740

1,990

0.9

3.6

3,506

3,960

1.8

5.3

3,160

3,580

1.6

5.4

1,115

1,280

0.6

4.6

2,019

2,100

1.0

4.8

1,060

1,260

0.5

5.0

Minato Ward, Tokyo

Honmachibashi Tower

Osaka City, Osaka

Nishi-Shinjuku Matsuya Building
Shibuya MK Building
Asahi Building
Hakata-eki East Place

OfficeShinjuku Ward, Tokyo

11,2005,350
4,590

11,700
5,440
4,630

5.7
2.7
2.4

3.6
3.7
3.8

Shinjyuku Ward,
Tokyo

3,990

3,990

2.0

3.9

Azabu Amerex Building

Minato Ward, Tokyo

2,780
2,400

2,910
2,390

1.4
1.2

3.7
3.6

Hiei-Kudan Building

Chiyoda Ward, Tokyo

Undab Center Shin-Yokohama

Yokohama City,
Kanagawa

2,300

Chiyoda Ward, Tokyo

1,510

1,490

0.8

3.8

Tachikawa City,Tokyo
Fukuoka City,
FukuokaFujisawa City,
Kanagawa

1,804

1,980

0.9

5.2

Urban Center Tachikawa
Urban Center Hakata
Urban Center Fujisawa

La Park Kishiwada

RetailSeiyu Minakuchi
BAGUS Ikebukuro Westabeno nini (Retail)
Subtotal

Urban Park Koenji
Urban Park Ichigao

1.2

1.5

4.4

2,054

2,200

1.1

74,787

82,980

Kishiwada City,
Osaka
Chikushino City,
Fukuoka

5,400

5,240

Koka City, Shiga

3,320

6,290
3,330

Urban Park Mizonokuchi

5.0

3,200

6,550

Urban Park Mitsuike Koen
Urban Park Ryogoku

Urban Park Miyamaedaira
Urban Park Tsurumi
Subtotal

1,113

1,190

0.6

4.9

37,77945,46019.4

4.9

Iwatsuki Logistics

Saitama City, Saitama

6,942

7,690

3.6

4.8

5.6

Yokohama Logistics

Yokohama City,
Kanagawa

3,560

4,340

1.8

5.7

38.4

4.5

Funabashi Logistics

Funabashi City, Chiba

7,875

8,930

4.0

5.3

2.8

7.1

Baraki Logistics

Ichikawa City, Chiba

4,700

5,030

2.4

3.9

Tokoyozawa Logistics

Tokorozawa City,
Saitama

1,300

1,550

0.7

5.8

Funabashi Nishiura Logistics I

Funabashi City, Chiba

821

891

0.4

7.0

Matsubushi Logistics

Kita-Katsushika-gun,
Saitama

2,755

3,240

1.4

5.7

Funabashi Hi-Tech Park Ⅰ

Funabashi City, Chiba

1,710

1,710

0.9

6.5

Funabashi Hi-Tech Park Ⅱ

Funabashi City, Chiba

702

705

0.4

6.8

30,36534,086

15.6

5.2

3.4
1.7

5.6
7.4

Toshima Ward,
Tokyo

2,984

3,410

1.5

4.1

Osaka City, Osaka

9,500
27,754

10,10028,370

4.9
14.2

4.1
5.5

Logistics

Suroy Mall Chikushino

2,590

2,870

Subtotal

Urban Park Ryokuchi-koen

Urban Park Tokiwadai Koen

Takadanobaba Access

The Portal Akihabara

Residence

3,040
7,090
2,660

Urban Park Azabujuban

Shibuya Ward, Tokyo

2,973
6,065
1,763

Minami-Azabu Shibuya Building

Subtotal※1：“Appraisal NOI Yield” is the ratio of appraisal NOI using the direct capitalization method to the acquisition price of the property in the real estate appraisal report, rounded to the second decimal place.

42

Portfolio List (as of Jan 31, 2023)< Property>
Property nameAcquisitionPrice(mill)

Location

Appraisal
Investment
value atratio
end of(%)
13 FP(mill)Appraisal
NOI yield(%)(＊)

R&B Hotel Umeda East

Osaka City, Osaka

2,069

2,280

1.1

5.5

Smile Hotel Namba

Osaka City, Osaka
Edogawa Ward,Tokyo
Yokohama City,
Kanagawa
Fukuoka City,
Fukuoka

1,750

1,440

0.9

4.3

3,827

3,470

2.0

4.2

3,248

3,210

1.7

4.5

1,970

1,920

1.0

4.4

GLANSIT Akihabara

Chiyoda Ward, Tokyo

2,500

2,440

1.3

3.9

REMBRANT STYLE Tokyo Nishikasai
GrandeEdogawa Ward,
Tokyo

3,180

3,140

1.6

4.0

KOKO HOTEL Namba

Osaka City, Osaka

2,000

1,420

1.0

3.6

abeni nini (Hotel)

Osaka City, Osaka

3,600

3,690

1.8

4.9

24,14423,01012.4

4.4

194,829

213,906

100.0

4.8

REMBRANT STYLE Tokyo Nishi-kasai
Best Western Yokohama

Hotel

The BREAKFAST HOTELFukuoka Tenjin

Subtotal
Subtotal

Period-end appraisal value：

194,829 million yen

Total book value：

194,843 million yen

Period-end unrealized gains (losses)：

19,062million yen

Net assets per unit：

53,835 yen

Unrealized gains per unit：

9,919 yen

NAV per unit (*1)：

62,264 yen

P/NAV per (*2)

：

0.85

(*1) NAV per unit = (Period-end net assets + Period-end unrealized gains – Total cash
distribution) / Total number of investment units issued and outstanding (*2) P/NAV per ＝
Investment unit price / NAV per unit (Investment unit price on January 31, 2023: 52,700 yen)

< Mezzanine loan debt investment >Type

Mezzanine

Mezzanine(Subordina
ted bonds)

Name of the security（asset overview）

Periodend bookvalue

Star Asia Mezzanine Loan Debt
Investment
Series 7

400
millionyen

Mezzanine Total
Subtotal

Underlying asset, etc.
Asset nameLocation

Relief Premium
HanedaOta-ku,Tokyo

Interest
rate (※2)
Base
rate
+5.0%

400
400

※1：“Appraisal NOI Yield” is the ratio of appraisal NOI using the direct capitalization method to the acquisition price of the property in the real estate appraisal report, rounded to the second decimal place.
※2 The base interest rate : JBA 3-month yen TIBOR

43

Balance of Payments of Individual Properties (1)Asset Type
Property nameAcquisition priceAppraisal value
Structure/Floors
Location
Lot area
Total floor areas
Construction completion

OFC-01
Minami-Azabu Shibuya
Building

Honmachibashi Tower

OFC-04
Nishi-Shinjuku Matsuya
Building

OFC-06

OFC-08

OFC-09Shibuya MK Building

Asahi Building

Hakata-eki East Place

2,973 million yen
3,070 million yen
SRC B1/7F
Minato Ward, Tokyo

6,065 million yen
7,070 million yen
S/SRC B1/21F
Osaka City, Osaka

1,763 million yen
2,650 million yen
SRC B1/9F
Shibuya Ward, Tokyo

2,042 million yen
3,290 million yen
S 6F
Shibuya Ward, Tokyo

6,320 million yen
8,280 million yen
S・SRC B2/12F
Yokohama City, Kanagawa

2,286 million yen
3,050 million yen
SRC 9F
Fukuoka City, Fukuoka

766.11㎡

1,274.37㎡

589.94㎡(surface right)

620.42㎡(of which 2.62 m² leasehold)1,096.86㎡

1,129.86㎡

4,137.21㎡
June 15, 1993

15,407.83㎡
February 8, 2010

5,117.80㎡
May 28, 1987

1,982.86㎡
July 31, 1993

12,353.83㎡
November 25, 1994

6,243.13㎡
February 24, 1986

13FP

14FP

13FP

14FP

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

OFC-03

14FP

13FP

14FP

13FP

14FP

13FP

14FP

98,919102,768

237,698

250,354

101,740

119,608

76,80870,716229,194

235,651

114,885

115,873

90,068

90,117

209,238

214,898

93,535

104,825

72,52566,970211,318

211,725

104,408

104,943

8,850

12,651

28,45935,456

8,204

14,783

4,282

3,745

17,87523,926

10,477

10,92928,957

31,12869,82573,32235,15438,19917,545

13,30055,59870,952

28,62929,616

6,002

5,949

13,86014,425

6,699

7,093

4,726

4,888

14,77814,802

8,252

8,328

Utilities expenses

6,080

7,971

23,84432,481

7,573

12,785

3,194

3,118

21,14429,209

7,368

8,937

Taxes and dues

4,498

4,496

19,807

19,807

3,445

3,445

4,418

4,418

15,952

15,952

7,321

7,321

Repair expenses

1,280

763

3,130

4,192

1,615

264

1,435

382

2,153

9,640

3,987

2,964

Trust fee

400

391

400

400

400

400

350

350

400

400

400

400

Insurance premium

148

150

457

465

164

167

57

58

479

487

216

219

Other expenses

10,546

11,404

8,324

1,550

15,255

14,044

3,363

84

689

460

1,083

1,444

NOI

69,961

71,640167,872

177,032

66,585

81,40859,26357,415173,595

164,699

86,25686,257

Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

12,655

13,26145,50445,454

10,534

10,613

3,761

3,942

29,37829,87910,447

12,08757,30658,379122,368

131,577

56,05170,79555,50253,473

144,217

134,81975,80874,1701,239

39,923

-

460

2,691

4,057

5,835

1,880

6,527

47,44865,182

37,840

NCF
Period-end book value

68,722

31,717

167,872

176,571

63,89477,35153,42855,535167,067

117,250

21,073

48,416

2,953,564

2,980,226

5,641,870

5,596,876

1,810,344

1,803,151

2,091,197

2,089,136

6,276,434

6,294,003

2,400,125

2,425,878

44Balance of Payments of Individual Properties (2)Asset Type
Property name

OFC-10
OFC-11
Nihonbashi Hamacho Park Amusement Media Gakuin
Building
HonkanOFC-12
Higashi Kobe Center
Building

OFC-13
Amusement Media Gakuin
Shinkan

OFC-14OFC-15
Urban Center
Kanda Suda-cho

Seishin Building

Acquisition price

1,450 million yen

2,580 million yen

7,440 million yen

1,020 million yen

11,200 million yen

5,350 million yen

Appraisal value

1,500 million yen

2,790 million yen

7,390 million yen

1,240 million yen

11,700 million yen

5,440 million yen

Structure/Floors

SRC 11FSRC S 8F/B1F

SRC 14F

RC７F

SRC 10F/1B

SRC 10F/1B

Location

Chuo Ward, Tokyo

Shibuya Ward, Tokyo K

Kobe City, Hyogo

Shibuya Ward, Tokyo

Shinjyuku Ward, Tokyo

Chiyoda Ward, Tokyo

Lot area

319.04㎡Number derived by multiplying theratio of holdings）
2,383.76㎡Number derived by multiplying
the ratio of holdings）

433.21㎡

8,488.11㎡

203.43㎡

886.93㎡

590.72㎡

1,892.18㎡

25,740.46㎡

913.71㎡

7,624.66㎡

4,994.70㎡

July 13, 1992

November 2, 1994

January 6, 1992

January 25, 1999

March 31, 1989

October 28, 1991

Total floor areas
Construction completion

13FP

13FP

14FP

13FP

14FP

13FP

14FP

39,90439,904

298,919

316,441

252,394

207,083

139,829

145,353

39,90439,904272,990

278,559

235,569

187,065

131,858

135,305--

25,92937,882

16,82420,017

7,970

10,04812,80912,932

116,561

131,401

65,46868,75340,18333,911

Management fee

678

678

24,797

25,11419,854

18,93011,77012,107

Utilities expenses

87

186

32,43543,902

12,403

14,138

5,896

7,998

Taxes and dues

4,371

4,371

29,02929,02821,49721,456

10,915

10,918

Repair expenses

472

379

5,554

10,066

10,233

10,325

10,715

1,912

Trust fee

400

400

400

400

350

350

350

350

Total operating revenue
from real estate leasing
Lease businessrevenue
Other lease businessrevenue
Total operating expenses
from real estate leasing

Insurance premium

14FP

13FP

14FP

（※）

（※）

13FP

14FP

（※）

（※）

172

175

939

954

283

288

208

211

6,627

6,742

23,404

21,935

846

3,264

327

412

NOI

27,094

26,97150,87552,554

182,358

185,040

19,292

20,642

186,925

138,329

99,645

111,441

Depreciation

2,921

2,941

4,221

4,221

39,117

41,679

1,676

1,676

14,964

16,204

8,846

8,903

Operating income (loss)
from real estate leasing

24,17324,03046,653

48,332

143,240

143,360

17,615

18,965

171,961

122,125

90,799102,538

Capital expenditures

2,464

5,306

-

-

37,58545,935--38,50764,429

1,564

3,508

Other expenses

NCF
Period-end book value

24,63021,66450,87552,554

144,772

139,104

19,292

20,642

148,41773,89998,081

107,933

1,446,988

1,449,353

2,579,773

2,575,551

7,657,714

7,661,970

1,035,530

2,575,551

11,277,041

11,325,267

5,344,479

5,339,084

45(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (3)Asset Type
Property name

OFC-16
Urban Center
Kanda Tsukasamachi

OFC-17

OFC-18OFC-19

Takadanobaba Access

Azabu Amerex Building

Hiei Kudan Building

OFC-20Urban Center
Shin - Yokohama

OFC-21The Portal Akihabara

Acquisition price

4,590 million yen

3,990 million yen

2,780 million yen

2,400 million yen

2,300 million yen

1,510 million yen

Appraisal value

4,630 million yen

3,990 million yen

2,910 million yen

2,390 million yen

2,540 million yen

1,490 million yen

Structure/Floors

SRC 8F/1B

SRC 14F/1B

SRC 8F/1B

SRC S 11F/1B

S RC 1F/1B

SRC S 8F

Location

Chiyoda Ward, Tokyo

Shinjyuku Ward, Tokyo

Minato Ward, Tokyo

Chiyoda Ward, Tokyo

Yokohama City, Kanagawa

Chiyoda Ward, Tokyo

Lot area

709.52㎡

930.70㎡

601.71㎡

700.59㎡

184.76㎡

5,356.99㎡

1,010.67㎡

March 17, 1992

May 31, 2002

Total floor areas
Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee
Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses
NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures
NCF
Period-end book value

4,629.27㎡

5,757.14㎡

2,909.80㎡

478.27㎡（Number derived bymultiplying the ratio of holdings）
3,205.72㎡（Number derived bymultiplying the ratio of holdings）

January 20, 1988

January 14, 1994

June 30, 1988

September 17, 1991

13FP

14FP

13FP

14FP

81,562

119,634

113,062

111,91272,99573,79369,07360,73180,73685,24836,23333,89376,259110,043

102,526

100,364

69,623

68,952

69,07360,731

71,90674,22633,24831,897

5,302

9,591

10,535

11,547

3,372

4,840

-

-

8,830

11,021

2,984

1,996

41,14931,74836,19938,27623,361

20,726

21,621

26,592

32,241

32,686

8,109

9,040

10,494
5,319
7,575
5,939
400
200
11,21840,413
12,425

9,608
8,366
7,565
5,277
400
204
326
87,886
12,723

13,398
8,715
9,266
3,506
400
219
692
76,862
9,675

13,417
11,259
9,197
3,043
400
223
733
73,635
10,702

7,181
3,099
7,818
2,777
375
103
2,005
49,634
3,817

7,472
4,350
7,817
466
375
105
138
53,067
3,849

3,480
39
6,844
974
500
186
9,596
47,452
3,909

3,421
74
6,845
357
500
189
15,204
34,139
3,934

9,003
6,501
7,779
7,733
350
190
683
48,494
12,585

9,047
8,328
7,779
5,511
350
193
1,476
52,562
13,871

2,974
1,179
1,578
120
400
39
1,817
28,123
3,472

2,653
1,661
1,578
1,075
400
40
1,632
24,852
3,603

27,98775,162

67,18662,93345,81749,21843,54230,20535,90938,69024,65021,24828,101
12,311
4,735,916

15,63372,252
4,738,827

46,89829,964
4,006,586

8,199
65,436
4,004,083

49,634
2,785,209

5,609
47,4572,786,969

47,4522,390,829

3,467
30,6722,390,362

53,970△ 5,476
2,422,649

19,99832,563
2,428,776

28,123
1,496,108

11,553
13,2981,504,057

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

46

Balance of Payments of Individual Properties (4)Asset Type
Property name

OFC-22
Urban Center Tachikawa

OFC-23
Urban Center Hakata

OFC-23
Urban Center Hakata

Acquisition price

1,804million yen

2,870million yen

2,054million yen

Appraisal value

1,980million yen

3,200million yen

2,200million yen

Structure/Floors

RC S 6F/1B

S 8F

SRC 8F/1BC

Location

Tachikawa city, Tokyo

Fukuoka city, Fukuoka

Fujisawa city, Kanagawa

Lot area

964.80㎡

656.72㎡

1,005.52㎡

4,659.20㎡
May 30, 1990

3,566.56㎡
August 27, 2020

4,392.71㎡
April 9, 1991

Total floor areas
Construction completion

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee
Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses
NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures
NCF
Period-end book value

14FP

13FP

14FP

13FP

14FP

85,02945,852

77,04377,043―77,09437,923

41,232

77,04377,043―

66,793

47,106

4,619

-

-

―

10,301

69,303

19,543

12,612

12,363―

14,833

4,824
4,498
4,551
400
45,530139
9,358
15,725
4,790

5,085
4,741
4,547
4,351
400
142
275
26,308
5,557

5,140
6,314
400
486
119
150
64,431
15,274

5,140
6,314
119
400
121
268
64,67915,281

―
―
―
―
―
―
―
―
―

4,285
8,047
21
1,670
363
134
310
62,260
5,942

10,93520,75049,15749,398―56,31820,825△ 5,099
1,830,430

27,865△1,557
1,852,738

1,161
63,2692,870,005

64,6792,854,723

―
―
―

1,443
60,817
2,147,887(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

47

Balance of Payments of Individual Properties (5)Asset Type
Property name

RTL-01
LaPark Kishiwada

RTL-02
Suroy Mall Chikushino

RTL-03
Seiyu Minakuchi

RTL-05
BAGUS Ikebukuro West

RTL-06abeno nini (Retail)Acquisition price5,400 million yen

6,550 million yen

3,320 million yen

2,984million yen

9,500 million yen

Appraisal value

5,240 million yen

6,290 million yen

3,330 million yen

3,410million yen

10,100 million yen

Structure/Floors

RC S 3F

S 2F

S 4F

SRC 8F/2B

RC24F/ 2B

Chikushino city, Fukuoka

Koka city, Shiga

Toshima Ward, Tokyo

Osaka city, Osaka

264.15㎡

633.90㎡

1,497.45㎡
November 20, 1992

4,866.82㎡
January 31, 2012

13FP

13FP

14FP

Location
Lot area
Total floor areas
Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee
Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses
NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures
NCF
Period-end book value

Kishiwada city, Osaka
39,799.74㎡
65,663.02㎡
August 30, 1994

121,423.46㎡（Also has leased land
19,917.56㎡ (of which leased land isof 25,321.5㎡ for use as a parking
16,444.53㎡)
lot.)

31,028.62㎡
June 22, 2007

31,829.71㎡
May 31, 1999

13FP

14FP

13FP

14FP

13FP

14FP

503,192

533,043

301,522

267,243―

201,113414,452

417,110274,833

263,274―

201,11388,739115,932

26,688

3,969

―

-

310,372

331,572

68,906

68,231―

18,034
1,090
3
81
318
131
16,410183,079
16,639

（※）

14FP

（※）

（※）

（※）

128,596
26,441

128,41326,441

59,426
2,304

60,943
2,304

―
―
―
―
―
―
―
―
―

123,548
114,371
43,9981,850
16,616
1,164
8,823
192,820
26,235111,190
150,175
44,199
9,417
1,850
1,184
13,553
201,470
27,587

24,525
5,985
19,799
350
1,440
612
16,192
232,615
23,48522,715
7,219
19,796
1,372
350
622
16,154
199,01123,314

166,584

173,883

209,129

175,697

102,155

101,972

57,122

58,639―166,439

48,682
144,138
5,417,634

84,181
117,2895,474,228

232,6156,450,531

199,011
6,427,216

128,596
3,247,477

128,4133,221,036

59,426
3,004,160

60,9433,001,856―――

183,079
9,589,242(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

48

Balance of Payments of Individual Properties (6)Asset Type
Property name

RSC-01
Urban Park Azabujuban

RSC-02
Urban Park Daikanyama

RSC-05
Urban Park Namba

RSC-06
Urban Park Gokokuji

RSC-07
Urban Park Kashiwa

RSC-08
Urban Park Ryokuchi-koen

Acquisition priceAppraisal value

6,315 million yen
9,430 million yen

1,490 million yen
1,530 million yen

1,460 million yen
1,560 million yen

1,186 million yen
1,190 million yen

1,550 million yen
1,680 million yen

Location

2,045 million yen
2,740 million yen
SRC with slate roofing
B1/12F
Minato Ward, Tokyo

Lot area

417.67㎡

Total floor areas

Structure/Floors

Construction completion①RC B1/3F ②RC B1/9F

RC 14FRC B1F/5F

SRC B1F/8F

RC 8F

Shibuya Ward, Tokyo

Osaka City, Osaka

Toshima Ward, Tokyo

Kashiwa City, Chiba

Suita City, Osaka

2,469.06㎡

670.39㎡

942.66 m 2 (Of which, 50.85 m2 is
contributed to Toshima Ward asroad)

1,597.85㎡

2,804.56㎡

2,564.94㎡

8,261.29㎡

2,776.87㎡

2,451.72㎡

4,243.71㎡

5,854.64㎡

November 29, 1999

1: November 15, 1982 2: May 30,
2006

January 9, 2013

February 28, 1990

August 28, 1997

March 10,1989

13FP

13FP

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

14FP

13FP

14FP

13FP

14FP

14FP

14FP

13FP

14FP

55,86556,193

192,871

197,239

47,402

48,394

48,33850,59338,336

38,582

61,57560,71654,27654,268

184,843

186,671

45,725

46,97946,442

46,63736,90537,72056,79457,591

1,589

1,925

8,027

10,567

1,676

1,415

1,896

3,956

1,430

861

4,780

3,124

10,96814,08537,581

41,614

18,68013,04721,098

17,697

9,206

8,949

17,66517,023

2,107

2,287

9,650

9,486

2,512

2,555

4,364

4,213

2,092

2,575

2,604

3,070

Utilities expenses

776

786

4,058

4,924

369

427

2,560

2,711

567

634

2,470

2,865

Taxes and dues

2,937

2,937

11,777

11,761

2,841

2,841

1,914

1,914

2,955

2,955

3,585

3,584

Repair expenses

2,633

3,811

2,812

5,438

4,966

4,097

4,733

5,179

1,459

1,403

2,871

5,214

Trust fee
Insurance premium

350

350

350

350

350

350

400

400

350

350

350

350

72

74

247

250

84

85

66

67

109

111

162

165

Other expenses

2,090

3,839

8,685

9,402

7,557

2,689

7,059

3,210

1,671

918

5,619

1,772

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

44,897

42,108155,289

155,624

28,72135,347

27,24032,89629,13029,633

43,91043,692

189

1,362

1,093

4,330

NCF

44,70840,746

154,195

151,294

2,067,927

2,064,089

6,347,559

6,339,077

1,481,961

Period-end book value

5,172

5,200

12,631

12,812

7,693

7,874

5,775

6,041

7,598

7,622

8,271

8,392

39,72536,908142,657

142,81221,02727,472

21,46526,854

21,53122,011

35,63835,300

5,511

1,881

10,770

-

305

750

2,686

4,498

23,20933,466

16,46932,89628,82428,883

41,22439,194

1,475,967

1,500,696

1,494,654

1,223,545

1,216,673

1,584,487

1,580,593

49

Balance of Payments of Individual Properties (7)Asset Type

RSC-09

RSC-10

RSC-11

RSC-12

RSC-13

RSC-14

Property nameUrban Park Koenji

Urban Park Ichigao

Urban Park Gyotoku

Shiroi Logiman

Urban Park Sekime

Urban Park Imazato

Acquisition price

1,167 million yen

1,810 million yen

1,430 million yen

2,470 million yen

2,150 million yen

993 million yen

Appraisal value

1,180 million yen

2,170 million yen

1,600 million yen

2,520 million yen

2,460 million yen

1,100 million yen

Structure/Floors

RC 4F

RC SF/1B

SRC 10F

RC 13F

SRC 15F

RC 10F

Location

Suginami Ward, Osaka

Yokohama City, Kanagawa

Ichikawa city, Chiba S

Shiroi city, Chiba

Osaka City, Osaka

Osaka City, Osaka

Lot area

988.26㎡

1,758.84㎡

1,122.57㎡

2,346.39㎡

1,803.70㎡

Total floor areas
Construction completion

1,524.34㎡

5,243.85㎡

3,397.95㎡

11,485.06㎡ （Number derived bymultiplying the ratio of holdings）
22,448.08㎡ （Number derived bymultiplying the ratio of holdings）

October 13, 1987

July 10, 1998

March 1, 1995

May 9, 1995

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

14FP

13FP

14FP

13FP

14FP

13FP

14FP

8,190.11㎡

4,862.83㎡

August 18, 1989

December 20, 1991

13FP

13FP

14FP

14FP

36,49636,13458,96059,08236,54637,005

142,518

143,01485,72487,17639,231

39,32733,871

33,95357,29056,751

34,90835,431

134,952

135,266

83,08884,98239,037

39,207

2,624

2,181

1,670

2,331

1,638

1,573

7,566

7,748

2,636

2,194

193

120

11,322

9,049

14,015

14,047

9,958

8,763

60,20062,07033,39324,19713,015

12,764
4,076

2,334

2,303

4,361

3,188

2,633

1,950

6,078

6,057

10,118

9,859

4,190

Utilities expenses

1,645

1,661

1,578

1,919

1,179

1,282

43

32

2,402

2,145

304

389

Taxes and dues

1,041

1,027

3,963

3,963

2,170

2,170

13,921

13,920

5,291

5,294

3,199

3,204

Repair expenses

3,370

2,392

2,633

3,371

2,562

1,588

10,544

12,695

12,315

4,638

3,737

3,711

Trust fee
Insurance premium

400

400

400

400

400

400

750

750

375

375

375

375

50

50

145

147

95

97

815

828

281

286

142

145

Other expenses

2,481

1,213

933

1,057

915

1,274

28,04827,785

2,609

1,598

1,065

862

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

25,17327,08444,94545,035

26,58828,241

82,31880,944

52,331

62,97826,216

26,562

2,883

2,970

5,469

5,628

4,359

4,386

19,241

19,323

12,557

13,052

5,203

5,243

22,29024,114

39,47539,40722,22823,85563,076

61,621

39,77349,92521,012

21,319

3,478

-

598

21,497

762

951

761

1,624

12,95724,366

460

2,191

NCF

21,69527,08444,34623,53825,82527,28981,556

79,31939,37338,61225,75524,371

1,187,777

1,184,806

1,910,611

1,926,480

1,506,612

1,503,177

2,397,111

2,379,412

2,194,313

2,205,626

972,947

969,895

Period-end book value

50

Balance of Payments of Individual Properties (8)Asset Type

RSC-15

Property nameUrban Park Yoyogi

Acquisition priceAppraisal value

1,740 million yen
1,990 million yen

Structure/Floors
Location
Lot area
Total floor areas
Construction completion

RSC-17
Urban Park
Mitsuike Koen

3,506 million yen
3,960 million yen

3,160 million yen
3,580 million yen

RC 5F

RC 6F

RC 8F
Shibuya Ward, Tokyo
464.09㎡

Yokohama City, Kanagawa Yokohama City, Kanagawa
12,544.61㎡
10,216.95㎡

RSC-18

RSC-19

RSC-20Urban Park Ryogoku

Urban Park Mizonokuchi

Urban Park Miyamaedaira

1,115million yen
1,280 million yen

2,019million yen
2,100million yen

1,060million yen
1,260million yen

SRC 9F

RC 5F

S Alloy-plated steel plate 3F

Sumida Ward, Tokyo
669.98㎡

Kawasaki City, Kanagawa
2,624.51㎡

Kawasaki City, Kanagawa
1,239.53㎡

1,418.03㎡

15,708.08㎡

10,918.37㎡

2,351.42㎡

5,029.52㎡

2,039.17㎡

September 4, 2017

Feb 17, 1994

March 24, 1992

October 31, 1997

August 23, 1988

June 10, 2021

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

RSC-16
Urban Park
Tokiwadai Koen

14FP

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

42,502

41,285

143,364

144,047

130,541

128,477

37,01136,29665,71362,72332,92732,78339,70940,895

135,861

137,549

122,424

122,666

34,25335,942

61,11659,37332,62032,183

2,792

389

7,502

6,498

8,116

5,811

2,758

354

4,597

3,349

307

599

7,804

6,755

40,084

38,46341,32141,053

11,7897,155

26,94821,502

4,605

5,908
1,373

2,309

2,260

11,186

13,103

10,53911,267

2,660

2,553

4,566

4,185

1,312

Utilities expenses

254

302

2,032

3,313

1,342

2,309

526

570

982

1,079

52

55

Taxes and dues

1,655

1,655

10,793

10,790

8,813

8,813

1,851

1,851

3,404

3,404

1,605

1,605

Repair expenses

588

498

9,276

5,914

12,414

10,462

4,533

1,684

11,609

9,856

264

535

Trust fee
Insurance premium

400

400

400

400

400

400

400

400

400

400

400

400

49

50

414

421

333

338

72

74

149

151

51

52

Other expenses

2,546

1,587

5,981

4,519

7,477

7,460

1,744

21

5,837

2,424

919

1,886

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

34,69734,530103,279

105,584

89,22087,42425,222

29,14038,764

41,22028,321

26,874

4,393

4,393

12,633

13,33012,014

12,528

2,503

2,518

5,742

6,014

4,523

4,523

30,30430,13690,64692,253

77,20574,89522,71826,622

33,02135,206

23,79722,350

-

-

1,064

33,153

20,625

1,972

1,886

379

3,857

15,928--

NCF

34,69734,530102,215

72,43068,59485,451

23,33528,76034,90625,291

28,321

26,874

1,722,425

1,718,032

3,611,372

3,631,195

3,294,786

3,284,230

1,149,533

1,147,394

2,084,086

2,094,000

1,100,577

1,096,054

Period-end book value

51(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (9)Asset Type

RSC-21

Property nameUrban Park Tsurumi

Acquisition priceAppraisal value

1,113 million yen
1,190 million yen

Structure/Floors

RC 6F

Location

Yokohama City, Kanagawa

Lot area

2,172.70㎡

Total floor areas

3,169.13㎡

Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee
Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses

February 17, 1994
13FP

14FP

（※）

（※）

NOI

28,22428,563

Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

2,717

2,726

25,50625,837

-

1,501

NCF

28,22427,0611,150,838

1,149,613

Period-end book value

52(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (10)Asset Type

LGC-01

LGC-02

LGC-03

LGC-04

LGC-05

Property nameIwatsuki Logistics

Yokohama Logistics

Funabashi Logistics

Baraki Logistics

Tokorozawa Logistics

Acquisition priceAppraisal value

6,942 million yen
7,690 million yen

3,560 million yen
4,340 million yen

7,875 million yen
8,930 million yen

4,700 million yen
5,030 million yen

1,300 million yen
1,550 million yen

821 million yen
891 million yen

Structure/Floors

Steel construction, zinc plated
steel roofing, 5 floors

RC 8F

Building 1: Steel construction, flat roof,
zincplated steel roofing, 8 floors Building 2:
Reinforced concrete structure

RC・S 5F

S 2F

R 4F

Location

Saitama City, Saitama

Yokohama City, Kanagawa

a Funabashi City, Chiba

Ichikawa City, Chiba

Tokorozawa City, Saitama

Funabashi city, Chiba

Lot area

15,623.14㎡

Total floor areas

29,729.72㎡

Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

October 29, 2014

10,565.95㎡

19,858.00㎡

18,387.89㎡(including 256.15

38,871.45㎡(two buildings

m2 break areas etc.)

combined)
1: September 25, 1992
2: August 5, 1997

October 1, 1994

13FP

14FP

13FP

14FP

201,296

205,181

13FP

14FP

258,038

269,093

187,713

187,713

243,184

244,264

13,583

17,467

14,85324,82834,121

38,074

61,24962,909（※）（※）

LGC-07
Funabashi Nishiura
Logistics Ⅱ

6,240.96㎡

8,645.63㎡

3,964.00㎡

12,471.50㎡

5,994.75㎡

6,316.32㎡

August 14, 2015

April 30, 1999

Warehouse: Mar. 20, 1991 Plant:
May 15, 1972 Office: May 13, 1986

13FP

14FP

13FP

14FP

13FP

14FP

（※）

（※）

（※）

（※）

（※）

（※）

5,650

6,140

11,30812,187

Utilities expenses

13,583

17,467

14,71323,166

Taxes and dues

13,44813,44821,643

21,634

Repair expenses

742

315

12,660

3,685

Trust fee

350

350

400

400

Insurance premium

346

352

501

510

-

-

21

1,324

NOI

167,175

167,106

88,457

94,956

196,789

206,184

96,972

97,54336,01737,56928,483

26,584

Depreciation
Operating income (loss)
from real estate leasing

46,78846,87919,943

19,832

27,93628,997

15,77915,784

5,899

5,962

4,559

4,578

120,386

120,227

68,51375,124

168,852

177,186

81,19381,75930,11731,60623,92322,005

-

908

-

-

33,346

12,247

291

-

-

6,143

-

677

167,175

166,198

88,457

94,956

163,442

193,937

96,68097,54336,01731,42528,48325,907

Period-end book value
6,420,812
6,374,840
3,676,357
3,656,525(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

7,730,906

7,714,155

4,581,929

4,566,144

1,348,932

1,349,113

851,783

847,882

Other expenses

Capital expenditures
NCF

53

Balance of Payments of Individual Properties (11)Asset Type

LGC-08

LGC-09Property name

Matsubushi Logistics

Acquisition priceAppraisal value
Structure/Floors

2,755 million yen
3,240 million yen
RC 3F
Kita-Katsushika-gun,
Saitama
11,580.65㎡
19,833.47㎡

Location
Lot area
Total floor areas
Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

March 31, 1997

LGC-10

Funabashi Hi-Tech ParkⅠ Funabashi Hi-Tech ParkⅡ

1,710 million yen
1,710 million yen
S 2F

702 million yen
705 million yen
S 2F

Funabashi city, Chiba

Funabashi city, Chiba

13,420.44㎡
8,029.47㎡

8,268.35㎡
4,384.83㎡

May 19, 2003

September 5, 2001

13FP

14FP

13FP

14FP

13FP

14FP

（※）

（※）

（※）

（※）

（※）

（※）

Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses
NOI

69,562

79,022

54,95355,466

24,60824,608Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

16,283

16,457

5,737

5,737

2,594

2,594

53,27862,564

49,21649,72922,01322,013-

10,242

-

-

-

-

NCF

69,562

68,78054,95355,466

24,60824,6082,668,503

2,662,288

1,687,051

1,681,314

691,621689,027

Period-end book value

54(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (12)Asset Type

HTL-01

HTL-02

Property nameR&B Hotel Umeda East

Smile Hotel Namba

Acquisition priceAppraisal value
Structure/Floors

2,069 million yen
2,280 million yen
RC 9F

1,750 million yen
1,440 million yen
S 9F

3,827 million yen
3,470 million yen
SRC B1F／9F

3,248 million yen
3,210 million yen
SRC B1F／9F

1,970 million yen
1,920 million yen
RC 10F2,500 million yen
2,440 million yen
SRC 10F/B1F

Location

Osaka City, Osaka

Osaka City, Osaka

Edogawa Ward, Tokyo

Yokohama City, Kanagawa

Fukuoka City, Fukuoka

Chiyoda Ward, Tokyo730.26㎡
3,945.65㎡

285.28㎡
1,711.42㎡

1,418.00㎡
5,293.88㎡

782.66㎡
4,686.09㎡

543.94㎡
2,281.49㎡

167.74㎡
1,081.97㎡

October 20, 2000

February 6, 2008

March 19, 1991

September 21, 1987

February 20, 2017

September 20, 2017

13FP

13FP

13FP

13FP

14FP

13FP

14FP

（※）

（※）

（※）

（※）

Lot area
Total floor areas
Construction completion

Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

14FP

HTL-03REMBRANDT STYLETokyo Nishikasai

14FP

13FP

HTL-04

HTL-05The BREAKFAST HOTEL
Fukuoka Tenjin

Best Western Yokohama

14FP

14FP

65,392

65,277

17,626

27,79584,60084,60080,40080,40065,392

65,277

17,626

27,79584,60084,60080,40080,400

-

-

-

-

-

-

-

-

8,074

8,009

3,754

4,594

11,114

10,193

7,241

6,811

742

742

660

660

1,200

1,200

2,100

1,200

Utilities expenses

7

6

-

-

-

-

-

-

Taxes and dues

5,508

5,528

2,255

2,255

8,065

8,065

4,584

4,584

Repair expenses

HTL-06
GLANSIT Akihabara

1,288

1,198

196

1,033

1,267

343

-

467

Trust fee

350

350

550

550

400

400

400

400

Insurance premium

152

155

70

71

159

161

135

137

Other expenses

24

28

22

23

23

23

22

21

NOI

57,31857,267

13,871

23,201

73,48574,40673,15873,58848,03648,02865,432

48,895

Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

10,746

10,785

12,20912,222

13,02913,49913,06913,109

8,647

8,647

4,643

4,643

46,572

46,481

1,662

10,97860,45560,90660,08860,47839,38839,38060,78944,252

543

6,869

-

1,819

9,103

14,690

-

7,200

-

-

-

-

NCF

56,77550,39813,871

21,38164,381

59,71573,15866,38848,03648,02865,432

48,8952,097,900

2,093,983

1,626,519

1,616,116

3,837,530

3,838,720

3,208,265

3,202,355

1,922,330

1,913,683

2,485,377

2,480,733

Period-end book value

55(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (13)Asset Type
Property name

HTL-07
HTL-08REMBRANDT STYLE
KOKO Hotel Osaka Namba
Tokyo Nishikasai Grande

HTL-09abeno nini (Hotel)

Acquisition price

3,180 million yen

2,000 million yen

3,600 million yen

Appraisal value

3,140 million yen

1,420 million yen

3,690 million yen

Structure/Floors

S 8F

RC9F

RC24F/2B

Edogawa Ward, Tokyo

Osaka City, Osaka

Osaka City, Osaka

Location
Lot area

657.00㎡

335.31㎡

586.44㎡

Total floor areas

2,755.19㎡

2,061.38㎡

7,764.81㎡

February 7, 2017

April 7, 2017

January 31, 2012

Construction completion

13FP
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

14FP

13FP

14FP

13FP

70,00270,002

2,180

23,638―70,00270,002

2,180

23,638

―

-

-

-

-

―

6,864

6,871

5,036

5,259

―

990

990

900

900

―

14FP

（※）

Utilities expenses

-

-

-

-

―

Taxes and dues

5,220

5,220

3,213

3,213

―

Repair expenses

141

146

-

222

―

Trust fee
Insurance premium

400

400

350

350

―

90

91

64

65

―

Other expenses

22

22

508

508

―

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

63,137

63,130△ 2,855

18,379―65,72810,857

10,857

9,041

8,983

―

6,885

52,28052,273△ 11,897

9,396―

58,843

-

-

-

-

―

-

NCF

63,137

63,130△ 2,855

18,379―65,7283,121,523

3,110,665

1,953,045

1,944,061―

3,644,441

Period-end book value(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

56

Balance of Payments of Individual Properties (14)
OfficeRetailResidence

Logistics

Hotel

Total

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

13FP

14FP

2,293,289

2,377,116

1,030,752

1,227,438

1,331,565

1,333,996

961,616

985,459

443,188539,385

6,060,414

6,463,396

2,082,212

2,148,351

915,324

1,107,536

1,269,760

1,278,994

917,181921,299

426,716539,385

5,611,196

5,995,567

211,077

228,765

115,428

119,901

61,80555,00244,43564,15916,472-449,218

467,828

732,424

724,288

417,293454,518

397,073

370,507

198,598

196,416

51,60466,7591,796,993

1,812,490

Management fee

170,477

174,635

150,534

137,456

89,266

88,63730,91532,644

8,319

8,030

449,514441,402

Utilities expenses

153,892

212,993

120,357

157,395

23,66628,04145,70063,9367

6343,623

462,373

Taxes and dues

179,155

179,051

78,41578,46986,23386,20878,77478,76235,73435,754458,313458,246

Repair expenses

110,480

62,987

20,632

12,24993,562

82,942

27,632

11,665

2,893

3,411

255,200

173,257

Trust fee

7,875

8,230

3,100

3,418

7,650

7,650

3,350

3,350

3,200

3,518

25,175

26,166

Insurance premium

4,431

4,639

2,336

2,508

3,428

3,483

1,874

1,907

784

1,059

12,855

13,598106,11281,75041,91763,02093,26673,544

10,3504,150

664

14,978252,311

237,444

1,560,865

1,652,828

613,459

772,919

934,492

963,489

763,018

789,042

391,584

472,626

4,263,420

4,650,905

249,980

266,332

78,46696,286

141,387

144,583

145,522

146,823

82,24389,635697,599743,661

1,310,885

1,386,495

534,992

676,632

793,104

818,906

617,496642,218

309,340

382,990

3,565,820

3,907,244

Total operating revenue
from real estate leasing
Lease businessrevenue
Other lease businessrevenue
Total operating expenses
from real estate leasing

Other expenses
NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

312,556

344,563

48,682

84,181

67,010116,389

33,63830,218

9,646

30,579471,534

605,932

NCF

1,248,308

1,308,264

564,776

688,737

867,481

847,099

729,380

758,824

381,937

442,046

3,791,886

4,044,973

Period-end book value

73,052,802

75,282,781

18,119,803

27,713,580

38,489,170

38,460,976

29,657,898

29,541,293

20,252,490

13FP(2022/7)
Hotel,
7.9%

IncomeRatio(including
mezzanine)

Logistics,
16.9%

Mezz etc,
0.5%
Office,36.5%

Residence, 22.5%Retail,15.7%

14FP(2023/1)
Hotel,
9.3%
Logistics,
15.8%

Residence, 21.2%Mezz etc, 0.4%
Office,35.3%

Retail,18.0%

15FP (Forecast)Hotel,
9.0%
Logistics,
14.7%

Residence, 21.5%Mezz etc, 0.4%
オフィス,
36.2%

Retail,18.2%

23,844,761 179,572,164 194,843,394

16FP （Forecast)Hotel,
9.0%
Logistics,
15.6%

Mezz etc, 0.6%
Office,36.6%

Residence, 20.7%Retail,
17.5%

57

Note
（Note1）The “ratio of assets in Tokyo area (entire portfolio)” is the ratio of the total acquisition price of properties in the Tokyo area to the total acquisition price of properties held as of July 31, 2022 (end of 13thFP) for “End of July 2022.
The “ratio of assets in Tokyo area (excluding suburban retail facilities)” is the total acquisition price of properties in the Tokyo area to the total acquisition price of properties held as of July 31, 2022 (end of
13th FP) less the acquisition price of the three suburban retail properties for “End of July 2022.

（Note 2）

“Ratio of mid-sized assets” is, for “End of July 2022 (13th FP)" the ratio of “mid-sized assets” to SAR’s total assets, based on acquisition prices.

（Note 3）

“Average building age” is the weighted average calculated by dividing the building age of each property held as of July 31, 2022 (end of 13th FP) by its acquisition price for “End of July 2022,” the weighted
average calculated by dividing the building age of assets by the acquisition price for “Assets Acquired.
* “Building age” refers to, except for “Urban Park Daikanyama”, the period commencing on the date of completion of construction (based on the date of completion of construction of the principal building
as registered in the registry of real estates) to July 31, 2022. As for “Urban Park Daikanyama”, which consists of two buildings, “building age” refers to the period commencing on the date of completion of
the older building and ends on July 31, 2022.

（Note 4）

“Appraisal NOI Yield” is the ratio of appraisal NOI using the direct capitalization method to the acquisition price of the pr op erty inthe real estate appraisal report, rounded to the second decimal place.

（Note1）“Estimated leased area” refers to the leasable area in the building after extension as specified in the Basic Agreement and may be changed depending on the progress of the project.

（Note 2）

“Estimated monthly rent” refers to the expected rent for the building after extension as specified in the Basic Agreement and may be changed depending on future discussion with the tenant.

（Note1）

As of the date of this document, the housing development project has been completed and is scheduled for delivery at the end of August 2022. SAR does not plan to acquire such development projects,
etc., and there is no guarantee that SAR will be able to acquire it in the future as of the date of this document.

（Note 2）

“Properties managed by Star Asia Group” refers to properties held by Star Asia Group as of January 31, 2023, and excludes properties held or to be acquired by SAR, and properties in which SAR has
preferential negotiating rights as of January 31, 2023, as well as properties held by Polaris Holdings or its consolidated companies as of the same date. As of the date of this document, SAR has no plan toacquire properties operated by Star Asia Group and there is no guarantee that SAR will be able to acquire such properties in the future. The same shall apply hereinafter.

P.30（Note 1）“GRESB Real Estate Assessment” benchmarks ESG performance based on multiple factors and gives participants a five-grade relative evaluation. GRESB is the name of the organization which provides
annual benchmarking assessments to measure ESG (Environmental, Social and Governance) integration of real estate companies and funds. It was founded in 2009 by a group of major European
pension funds who played leading roles in launching the Principles for Responsible Investment (PRI).

P.31（Note1）“GHG” refers to greenhouse gas. Scope 2 emissions (indirect emissions associated with the purchase of electricity, steam, or heat) indicated in this document are calculated based on market-based
factors.

（Note 2）

“GHG emission intensity” refers to per-unit GHG emissions amount resulting from a specific activity. In this document, per-unit GHG emissions intensity is calculated using total floor area (m2) accounting
for operating months as a unit.

（Note 1）

The ratio of assets obtaining environmental certification is calculated by dividing the total floor area of assets which are environmentally certified as of the date of the document by the total floor area ofassets.

（Note 2）“DBJ Green Building Certification” is a certification under the framework system (hereinafter, “the framework”) established by Development Bank of Japan Inc. (hereinafter, “DBJ”) in April 2011 to support
properties with environmental and social awareness (“Green Building”). The framework rates and certifies properties required by society and the economy based on a comprehensive assessment covering
items from environmental performance of properties to measures for various stakeholders including disaster prevention and consideration for local communities, and supports such initiatives. Japan Real
Estate Institute (JREI) has conducted certification, while DBJ has controlled the overall framework since August 2017. The framework has five levels of certification (★ ~ ★★★★★).

（Note 3）

“BELS Evaluation Certification” is a third-party evaluation framework to assess energy saving performance of buildings based on criteria stipulated by the Ministry of Land, Infrastructure, Transport andTourism. The framework has five levels of certification (★★★★★～★).

（Note4）

CASBEE Real Estate Certification integrates multiple assessment methods including CASBEE’s real estate assessment system, which SAR was assessed. CASBEE’s real estate assessment system wasdeveloped with the aim of making use of the results of the environmental assessment of buildings in real estate assessment. It scores buildings under each of the evaluation items in five categories,
comprising "1. Energy & Greenhouse Gases", "2. Water", "3. Use of Resources & Safety", "4. Biodiversity & Sustainable Site", and "5. Indoor Environment". Based on the scores, the assessment results
are granted under one of four ranks: Rank S, Rank A, Rank B+, and Rank B. The same shall apply hereinafter.

（Note 5）

“Urban Park Miyamaedaira” consists of two buildings (“Urban Park Miyamaedaira EAST” and “Urban Park Miyamaedaira WEST”) and each of them received certification.

（Note 6）“Green lease contracts” indicates the lease contracts stating that the lessor and the tenant jointly determine rules including reduction of environmental burdens such as energy saving of properties andimprovement of working environment by concluding contracts, memorandums, etc., and implement such rules.

P.4

P.17

P.26

P.32

58

Disclaimer
This document has been prepared to provide information and is not for soliciting and inviting investment in or recommendingtransaction of certain products. SAR does not guarantee the accuracy or completeness of the information provided in thisdocument although effort has been made to provide correct information based on information available to SAR. Moreover,please note that the contents of this document are subject to change or removal without prior notice. Duplication andreproduction, etc. of the contents contained in this document without prior consent is prohibited. This document includes
graphs, data, etc. publicly disclosed by third parties. Furthermore, the document also includes analysis, judgement and other
opinions by Star Asia Investment Management, Co,. Ltd. concerning such information. This document discusses future
expectations, identifies strategies, contains projections of our results operations or financial condition, or states other forwardlooking information based on certain assumptions, estimates and projections, Known and unknown risks, uncertainties andother factors could cause our actual results, performance or achievements to differ materially from those contained or impliedin any forward-looking statement. We cannot give any assurances that the expectations expressed in these forward-looking
statements will turn out to be correct.
Copying, reprinting or any other use of the contents of this document without prior approval is strictly prohibited.

■ Contact regarding this material
Akiko Kanno, Director and CFO (General Manager of Finance Management Department)
Star Asia Investment Management Co., Ltd.
Atago Green Hills Mori Tower 18F, 2-5-1, Atago, Minato-ku, Tokyo 105-6218
Tel: +81-3-5425-1340
59