"Financial Results for the 15th Fiscal Period Ended July 2023"

Star Asia Investment Corporation

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)

1.

Executive summary22.

Summary of Public Offering

4

3.

Actual and forecasted distribution

8

4.

Operating results for the 15th fiscal period
ended July 2023

13

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 Group

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

Investment policy
5.

Progression Status of Mid-term plan

25

6.

Summary of Newly Acquired

31

7.

Initiatives on ESG

38

8.

Appendix

44

9.

Note

68

Prioritized, focusedinvestment in theTokyo Area (＊１)
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◆ Distribution per Unit
Forecast<Guidance> Forecasts for FP18

Forecasts for FP16 / FP17

FP15 (ended Jul 31, 2023)◆ Forecasted Distributions Per Unit

1,552 yen (0 yen)

FP16

◆ Forecasted Distributions Per Unit

1,513 yen (124 yen)

Guidance

1,500 yen (46 yen)

※ Forecast figures announced on August 7, 2023 (No revisions)

Actual Results

1,586 yen (0 yen)）

FP17※ Forecast DPU is the distribution amount announced in March 2023
※ 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 FP14 62,264 yen⚫ NAV per Unit increased by 0.9%.

Adjusted cruising distribution

1,538 yen (37yen)※ Guidance is the mid-term DPU goal announced in March 2023.
※ Cruising DPU is the forecast figure for 18 th FP after completing theround of initiatives.

※ Forecast figures announced on August 7, 2023 (No revisions)◆ Assumptions underlying the forecasts
for FP16 and FP17.

◆ Guidance Assumptions⁃

For the 16th FP, retained earnings used for expenses
etc. related to public offerings and the acquisition of
new properties, and the Forecast DPU announced in
March 2023 is maintained.

⁃

It is anticipated that the newly acquired 7 hotels will goto the currently assumed cruising mode (Assumed thatrevenues will improve from now up to the latter half ofthe 17th FP.)⁃For the 17th FP, it is assumed that the newly acquired
7 hotel properties are on the path towards revenues
improvement, and it is planned to utilize a certain
amount of retained earnings.

⁃

It is assumed that office occupancy rates will improvefrom the current condition.

⁃

A certain level of improvement in occupancy rates isassumed, due to the effect of LOPIA opening shop in
Suroy Mall Chikushino.

⁃

For residential properties and logistic facilities, it isassumed that occupancy rates will be maintained.

End of FP15 62,824 yen⚫ 2.2% increase from forecast DPU. A certain amount tobe retained in internal reserve, and expected to be
used from the next fiscal period for internal growthmeasures.

1,520 yen ( 55 yen)⁃

Up to the 15th FP, it is expected that internal growthmeasures will be realized, such as opening shop by
LOPIA in Suroy Mall Chikushino and completion ofbuilding extension at Funabashi High-Tech Park
Factory I.

Status Change due to execution of 6th Public Offering≪Summary of 6th Public Offering≫■Executed in August 2023. New properties (11 properties/ (Expected) total acquisition price: 49.1
billion yen)
■Asset size increased to 242.2 billion yen (71 properties, 1 preferred equity investment securities)-- Hotel exposure expanded at the best timing.
■Increase in revenues of hotels due to improvement of accommodation demand will contribute tointernal growth.
■By incorporating newly built and relatively new properties, a decrease in the average number ofyears since construction completion has been realized.
■In the mid-term, the expected effects are expansion of asset size ‐improvement of ratings –reduction of interest costs. Expansion of asset size will be pursued, while maintaining LTV levels.

≪Status Change≫◆ Asset Size(note1）

242.2 bn

Expanded by approximately 4times since listing.

◆ Market capitalization(note2）

137.3 bn Improvement of liquidity ofinvestment units.
◆ Improvement of average number of years since construction completion. （note3）

24.9 years

21.1 years◆ The likelihood of improvement in ratings (current ratings: A (JCR), A- (R&I))
Review will be conducted by the end of the year3

2．Summary of Public Offering

42． Summary of Public Offering （1）Status Change due to Public Offering (executed in August 2023)◆ Due to acquisition of properties achieved through the public offering, asset size has increased to 242.2 billion yen + liquidity of investment
units improved.
◆ Likelihood of improvement of ratings has increased + incorporated I to various (global) indices. ⇒Review will be conducted by the end of theyear(hundred million）
3,000

Asset size
資産規模…

SAR

SAR

After PO

Before PO

R&I （Right)(右軸）（Right)JCR (右軸）

AA+
6

2,500

AA
5

2,000

AA4

1,500

A+
3

1,000

A2

500

A1

0

0

TSE REITCore
MSCI JapanSmallCap
FTSE Global Equity
Index SeriesMid
FTSE Global Equity
Index SeriesSmall
FTSE EPRA /NAREIT● ●GPR 250● ● ● ● ● ● ● ● ● ●●GPR/APREA
Investable100

● ●

●

●

●

● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●●●● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ●※as of August 31, 2023.

●
Start from September 18(announced on September 1, 2023)

●

●

●

5

2． Summary of Public Offering （2）Increased Exposure to Hotels with Strong Growth Potential◆Acquisition of hotels expected to generate increased rent revenue as hotel revenue increase due to increasing hotel guest demand
going forward◆Acquisition of newer residences expected to generate stable revenue and lower the average portfolio building age
Internal growth potential

Expectations for stability

7 hotels: JPY 45.4 bn ／Appraisal Value 48.1bn

4 residences: JPY 3.7 bn
Appraisal Value 4.7bn

KOKO HOTELBest Western Plus
Fukuoka Tenjin
Fukuoka TenjinAppraisal NOI yield(Note1)
Minami
4.9%
Appraisal NOI yield
6.7%

Anticipated
Anticipatedappearance
appearance
at
atcompletion
completion(Note2)(Note2)

KOKO HOTEL
Hiroshima Ekimae
Appraisal NOI yield
5.2%

Urban Park Kamata-Minami I
Appraisal NOI yield
5.0%

Urban Park Kamata-Minami II
Appraisal NOI yield
4.7%

KOKO HOTEL
Fino Hotel
Sapporo Ekimae
Sapporo Odori
Appraisal NOI yield Appraisal NOI yield
4.9%
4.6%

KOKO HOTEL
KagoshimaTenmonkan
Appraisal NOI yield
6.1%

Upside potential
through partial
variable rent
structures

Anticipated
Anticipatedappearance
appearance
atatcompletion
completion(Note2)(Note2)

KOKO HOTEL
Ginza 1-chomeAppraisal NOI yield
4.0%

Highly competitive
locations near tourist
attractions

Urban Park Mitaka
Appraisal NOI yield
5.0%

Average buildingage(Note3): 7.4 years
Average appraisal NOI
yield : 4.8%

Acquisition of newer residences
reduces average portfolio building
age / Average building age: 0.1

Urban Park Umejima
Appraisal NOI yield
4.1%

Acquisition of residencesin Tokyo area expected toprovide stable revenues

After the Initiative, asset size is expected to increase to JPY 242.2 bn

6

2． Summary of Public Offering （3）Portfolio Following the Initiative◆Assets (to be Acquired): 7 hotels (JPY 45.4 bn), 4 residences (JPY 3.7 bn), 1 student residence (Preferred Equity Securities
JPY 1.5 bn)◆Assets (Transferred): 1 logistics, 2 residences; anticipated gains on sales of JPY 790 mn)
With the acquisition of 11 properties and 1 Preferred Equity Securities totaling JPY 50.7 bn, total asset size increase to JPY 242.2 bn
End of January 2023

Assets (Transferred)

Assets (to be Acquired)

After PO

Student residence Residence
3.1%
7.5%

Student residence
0.6%

Hotel
28.7%

Asset size

JPY
194.8 bn

JPY
3.3 bnJPY
50.7 bn
Hotel
89.5%

OfficeJPY 30.9%
242.2 bn
Logistics
12.2%

Residence
16.1%

Retail
11.5%

Number ofproperties(Note1):
Real estate, etc.
(Note2) / Preferred
Equity Securities63

3

11 / 171 / 1

Percentage
acquiredwith sponsor
group
involvement

81.1%

―

100.0%

84.8%

Averagebuilding age(Note3)

24.9 years

31.7 years

6.9 years

21.1 years

Averageappraisal
NOI yield(Note4)

4.8%

4.8%

4.8%

4.8%

Average postdepreciation
appraisal
NOI yield(Note5)

4.1%

4.1%

3.9%

4.0%

Note: ‘Mezzanine loan debt are excluded.
Note: Average building age’, ‘Average appraisal NOI yield’ and ‘Average post- depreciation appraisal NOI yield’ are calculated by excluding Preferred Equity Securities

73．Actual and forecasted distribution8

3. Actual Distributions and Business Forecast (1)Actual distributions for FP ended July 31, 2023
◆ In the 15th FP, portfolio NOI exceeding initial forecast was recorded, and DPU increased by 34 yen (+2.2%) compared to theinitial forecast.
◆ DPU in and after the 18th FP when revenues from the 7 newly acquired hotels are expected to improve and operations stabilize
was set as “Guidance”. (Upward revision from the former Guidance (+2.5%)）.

FP15(ending Jul 2023)-Actual-FP16(ending Jan 2024)-Forecast-

FP17(ending Jul 2024)-Forecast-

1,586 yen

1,513 yen

1,520 yen

+ 34 yen (+2.2%) v.s. forecast

Utilization of Internal
Reserve: 124 yen

Utilization of Internal
Reserve: 55 yen

Utilization of Internal
Reserve: 0 yen≪ Guidance for distribution per unit ≫◼ We will set a new distribution perunit as "Medium-Term Guidance".
◼ Aiming for the following distribution
per unit

Guidance

1,538

yen

Utilization of Internal Reserve:37 yen(yen）< P/L from Leasing
Business >・PO during the FP15
・ Dilution by PO<P/L from Leasing
Business>
・Increase in Hotel
Revenue etc.

<Non-operating
Expenses>
Decrease of financecosts<Internal
Reserve>Use Internal
reserve<Internal
Reserve>• Implemented
Internal
Reserve<Non-operating
Expenses>
Increase of financecosts

P/L from Leasing Business
DPU/15FP Forecast<Internal
Reserve>
Decrease inusing Internal
Reserves

Internal Reserve
OthersGain on sales
DPU/15FP result

Non-operating Expenses

P/L from Leasing Business

Others< P/L from Leasing
Business >• Properties acquired in
the FP16 will beeffective for the full.
• Increase in Hotel
Revenue

Internal Reserve

Gain on sales Others

DPU/16FP Forecast

Non-operating Expenses

P/L from Leasing Business

OthersInternal Reserve

DPU/17FP Forecast

93. Actual Distributions and Business Forecast (2)Operational Results (Summary) for FP15 ended Jul 31, 2023 andForecast Assumptions for FP16 ended Jan 31, 2024 and FP17 ending Jul 31, 2024
◆ Office occupancy rate is steadily increasing, increase in rents have been realized, residence occupancy rates has been maintained at or above 95.0% during the FP15, andoccupancy rates of logistics facilities is also rising.
◆ Due to recovery of accommodation demand, variable rent from hotels have been received (approximately 75mn) / Expect internal growth effective from 7 newly acquired
hotel properties.

Forecast Assumptions for FP16 ended Jan 2024 andFP17 ended Jul 2024

Actual Result of FP ended Jul 2023••

Office••Occupancy rates have risen steadily (end of 14th FP: 94.3％ ⇒ end of 15th FP: 96.9%).
The moves of potential tenants continued to be active, and new tenants were consistently
attracted.
New contracts with 12 tenants: Average rent increase of 0.7% (excluding special contracts)
Rent increases at timing of contract renewals were realized: 7 tenants, average increase by
8.0%.

•
•
•

•
•

Retail••••Residence••••

Logistics•

During the 15th FP, revenues continued to be stable (occupancy rates, end of 14th FP:
98.6%⇒ end of 15th FP: 97.9%)
4 tenants moved out (800.26㎡), impact was limited.
Realized attracting the supermarket “LOPIA” to Suroy Mall Chikushino as anker tenant(Signed fixed-term building lease contract)••

Average occupancy rates for all residences during the 14th FP was maintained at or above
95.0%.
For family type residences, rent increase were realized at the time of signing new contracts
and contract renewals, which continued from the preceding period.
For single type residences, recovery of demand was confirmed, average occupancy rates
during the period: 95.9%
2 previously owned single-type residential properties were sold (August 31, 2023),•

Revenues during 15th FP remained stable.
At Baraki Logistics, in order to respond to needs for increasing floor space, the fixed-termlease for 1 tenant was not renewed, and the entire building was leased to it (starting from
August 1, 2023)-- Realized increase in rented area and increase in rent.
Sale of Funabashi High-tech Park Factory II-- realized gain on sale.

•
•

•
•
•

•

•
•

Hotel

•

Given recovery in accommodation demand, variable rents were received from tenants of“Smile Hotel Namba” and “KOKO HOTEL Osaka Namba” (total amount of around 75 million
yen, 2.6 times the preceding period)
The operating condition (KPI) of hotels have recovered to the condition before COVID-19(for the 5 hotels for which KPI has been disclosed)•••

The active moves of potential tenants are continuing, and also as there is little
new supply of mid-sized offices, the rising trend of occupancy rates is to be
maintained (assumption)
No changes to leasing activities and free rent periods.
Occupancy rates are expected to increase during the 16th FP, and remain
stable during the 17th FP / Increase in rents are not assumed.
6 tenants expected to move out during the 16th FP.4,641.08㎡-- (Expected) cancellation of floor area: 3,987.08㎡
The occupancy rate at Suroy Mall Chikushino is anticipated to decline -92.0％
Given the achievement to attract “LOPIA” to Suroy Mall Chikushino (plannedto open in December 2023), leasing activities of vacant compartments will be
actively promoted – Aim to realize internal growth.
In the 16th FP, gain-on-sale expected to be achieved for dispositions of Urban
Park Gokokuji and Urban Park Koenji.
From the 16th FP going into the 17th FP, focus on improving occupancy rates
for newly acquired properties.
For other held properties, it is assumed that occupancy rates will bemaintained around the average level.
Rents are assumed to be maintained at the same levels.
Revenues are expected to remain stable.
Proceed with the building extension of Funabashi Hi-tech Park FactoryⅠ—
expected to be completed in December 2023.
Contract terminated for one tenant whose contract expires during the 16th
fiscal period. Another tenant increased the floor space and concluded acontract with an increase in rent. Contract renewal negotiations are underwaywith one other tenant.
Given the improvement of accommodation demand from both domestic andinbound travelers, it is assumed that the operational status of the tenants will
improve further.
Expectation towards internal growth from variable rent revenues from the 7
newly acquired properties.
Even for the other held hotels, receipt of variable rents may be expected.
(Hotels with variable rents: 6 of the 9 hotels held from before)103. Actual and forecasted distribution (3)Factors for increase/decrease compared with forecast/actual results for the FP15
◆ Rental revenues, excluding hotel revenues, were almost in line with the initial forecast◆ Variable rents from hotels were surpassed 65 million yen compared to the initial forecast(Unit: million yen)
FP15 (ended Jul 2023)
forecast * 1

FP15 (ended Jul 2023)
Actual

6,576
2,076
1,046
1,232
846
515
858

6,503
2,077
1,048
1,227
869
581
700

△72 △1.1% <Revenue of leasing business>+0+0.0% Backward Free Rent term +23 million yen+1+0.1% variable rent +65 million yen△5 △0.4% Utility revenue△138.5 million yen
Penalty charge revenue △34.1 million yen
+22
+2.7%
Original state restoration fee revenue +6.8 million yen+65 +12.8%△157 △18.4%

2,126

1,981

△145

AFFO per unit
Balance of internal reserves

4,449
760
3,689
871
3,578
413
22
598
3,527
543
2,983
2,983
0
2,983
1,552 yen
1,732 yen
1,279 yen
8,803

4,521
763
3,758
787
3,733
414
22
6
595
3,606
1
534
3,073
3,073
0
3,073
1,586 yen
1,780 yen
1,370 yen
8,828

+72
+2
+69
△83
+155
+0
+0
+6
△3
+79
+1
△8
+90
+90
+90
34 yen+48 yen+91 yen+24+1.6%+0.4% <Expenses of leasing business>+1.9% Utility costs △189.0 million yen△9.6% Repair costs +37.0 million yen+4.3% Cost of master lease scheme change +8.0 million yen
+0.1%
+0.5%
△0.5%
+2.3%
△1.6%
Interest expence △8 million yen
+3.0%
+3.0%
0.0%
+3.0%
+2.2%
+2.8%
+7.1%
+0.3%

(Reference) Net income per unit
(Yen per unit) * 2

1,552 yen

1,599 yen

47 yen+3.0%

Lease business revenue
Office rent
Retail rent
Residence rent
Logistics rent
Hotel rent
Other
Expenses related to rent business(Depreciation is excluded)
NOI
Depreciation
Rent revenues/expenses
Capex
NCF(NOI-CAPEX)
Gain on sales
Mezzanine
Income from securities lending fees
SGA
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Income before income taxes
taxes
Net income
Cash distribution per unit
FFO per unit

Comparison with
forecast

Factors for the increase/decrease△6.8%（*1）Announced in 14th FP closing of accounting report (Mar 16, 2023) （*2） Net income divided by the number of units outstanding11

3. Actual and forecasted distribution (4)Forecast of business results for the FP16 ending Jan 2024 / the FP17 ending Jul 2024
◆ Acquired 11 new properties through a public offering in August 2023, and the new properties will fully contribute to the period ending July 31, 2024
◆ Aiming for increase in Lease revenue of hotels toward the end of the 17th fiscal period(Unit: million yen)

Lease business revenue
Office rent
Retail rent
Residence rent
Logistics rent
Hotel rent
Other
Expenses related to rent business(Depreciation is excluded)
NOI

FP15 (ended Forecast for
Major factors for the
Forecast for the
Major factors for theJul. 2023)
the FP16
Increase/decrease
Increase/decrease
increase/decrease
FP17 ending Jul
increase/decrease
Actualending Jan
(B-A)
(C-B)
(VS FP15 Actual)2024(C)(VS FP16 Forecast)(Ａ)
2024 (B)
6,503
7,468
+965
+14.8% ＜Rental revenues>
7,980
+511
+6.9% <Rental revenues>
Shuroy Mall Chikushino -38.4 mn
Shuroy Mall Chikushino +47.7 mn
2,077
2,103
+26
+1.3% Abeno nini (Retail ): -5.2 mn
2,188
+85
+4.1% Abeno nini (Retail) +7.5 mn
1,048
1,001
△46
△4.4% 2 properties sold in the FP16: -64.9 mn
1,054
+52
+5.3% 2 properties sold in the 16th period 1,227
1,205
△21
△1.8% 4 properties acquired in the FP16:
1,271
+65
+5.5% 13.4 mn+30.1 mn
4 properties acquired in the 16th
869
877
+8
+0.9% Properties held continuously: +13.1 mn
910+33+3.8% period +74.7 mn
581
1,476
+895 +153.8% Properties sold in the FP15: -3.4 mn
1,821+344 +23.3% Baraki Logistics +21.3mn
Other +11.5 mn
Funabashi High Tech Park Factory I
700
804+104 +14.9% Newly acquired 7 properties: +895.1 mn
735△69 △8.6% +10.4mn
1,981

2,126

+145

4,521
763
3,758
787
3,733

5,342
953
4,388
1,151
4,190

+820
+190
+630
+363
+456

414

380

△33

+7.3% Properties sold in the FP15-FP16 -53.1

2,130+12.2%

5,850
1,024
4,826
867
4,983

mn
+18.1% (of which -48.8 mn was the loss ofcancellation penalties)+24.9%
Utilities: +130.7 mn+16.8% Cancellation penalty income +32.9 mn+46.2% Income from restoration expenses -6.0mn

+3+0.2% 7 properties acquired in the 16th
period +349.9 mn

FFO per unit

22
6
595
3,606
1
534
3,073
3,073
0
3,073
1,586 yen
1,780 yen

12
△10 △47.0%
Properties acquired in the FP16: +68.8
31+24 +371.8% mn
702+106 +17.9% Utility expenses +177.5 mn
Repair expenses -30.7 mn
4,110
+503
+14.0% Leasing-related expenses -15.1 mn△1 △100.0% ML scheme change expenses -8.0 mn
814+279 +52.2% ＜Gain on sales of real estate＞FP15:
3,296
+222
+7.2% Funabashi High Tech Park Factory II
3,296
+222
+7.2% FP16: Urban Park Gokokuji, Koenji
00.0% <SGA>
3,296
+222
+7.2% Asset management fees +78.4 mn
Asset custody and general
1,513 yen △73 yen△4.6% administration fees +8.3 mn
1,631 yen △149 yen△8.4% Other operating expenses +19.8 mn+508+9.5% 2 properties sold in the 16th period 0.8 mn
+70
+7.4%
11 properties acquired in the 16th
+437 +10.0% period +0.2 mn△284 △24.7% Utility fee income -34.7 mn
Cancellation penalty income -33.9 mn+792 +18.9%△100.0 ＜Rental expenses>△380% 2 properties sold in the 16th period 4.9 mn
9△2 △17.7%
11 properties acquired in the 16th31
+0 △1.1% period: +128.5 mn
707+5+0.8% Leasing-related expenses -44.8 mn
Repair expenses -38.8 mn
4,159
+49
+1.2% Utility expenses -31.9 mn＜Gain on sales of real estate>682△131 △16.2% 16th FP: Urban Park Gokokuji, Koenji
3,477
+180
+5.5%
3,477
+180
+5.5% <Preferred securities lending fees>
Interest expenses +26.6 mn
0
0.0% Loan-related expenses -158.3 mn
3,476
+180
+5.5%
1,520 yen +7 yen+0.5%
1,897 yen +266 yen +16.3%

AFFO per unit

1,370 yen

1,145 yen △225 yen

1,531 yen +386 yen +33.7%

Depreciation
Rent revenues/expenses
CAPEX
NCF(NOI-CAPEX)
Gain on sales
MezzaninePreferred securities lending fee
SGA
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Income before income taxes
Taxes
Net income
Cash distribution per unit

Balance of internal reserves(Reference) Net income per unit

(Yen per unit)

8,828

1,599 yen

＜Rental expenses＞△8.2% Properties sold in the FP15- FP16 -31.7
mn

8,535

△292

1,389 yen △210 yen△16.4% ＜Non-operating expenses＞
Interest expenses +98.6 mn
Loan-related expenses +172.8 mn△3.3%
Amortization of investment unit
issuance costs +7.5 mn△13.1%

△128

△1.5%

1,465 yen +76 yen

+5.5%

8,406

12

4．Operating results for the 15th fiscal
period ended July 2023

13

4．Operating results for the 15th fiscal period ended July 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 FP15 (on a contracted
floor area basis).
◆ Aim to further improve office occupancy rates from the 16th fiscal period onward/Promote internal growth measures (attract new tenants forretail, construct expansion of logistics facilities)
100.0%

Hotel, 100.0%

99.0%

Logestics, 98.6%
98.0%

Total, 97.9%
Retail, 97.9%

97.0%

Residence, 97.1%
96.0%

Office, 96.9%

95.0%
94.0%

93.0%
92.0%
91.0%

OfficeRetailResidence

Logestics

Hotel

FP14

Total

FP15

90.0%

FP12
(Jan 2022)

FP13(Jul 2022)

FP14(Jan 2023)

FP15
Feb 2023

Mar 2023

Apr 2023

May 2023

Jun 2023

Jul 2023

Office

92.8%

92.8%

94.3%

94.9%

95.1%

95.7%

96.6%

96.8%

96.9%

Retail

99.4%

99.4%

98.6%

98.1%

98.0%

98.0%

97.9%

97.9%

97.9%

Residence

95.1%

95.1%

97.5%

97.6%

97.1%

96.5%

95.7%

96.1%

97.1%

Logistics

97.8%

97.8%

98.6%

98.6%

98.6%

98.6%

98.6%

98.6%

98.6%

Hotel

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Total

96.7%

96.7%

97.6%

97.6%

97.5%

97.5%

97.5%

97.6%

97.9% 14

4. Operating results for the 15th fiscal period ended July 2023 (2)- Office ①- Status of change in tenant as of the end of the FP15
Operating result for office

Status of change in tenant as of the end of the FP15

<Actual performance for FP15>◼ Entry and moving out of tenants:
Newly contracted area (3,600.57㎡) > moved out area (1,449.15㎡).
Occupancy rates: 94.3% (as of end of Jan 2023) → 96.9% (as of end of Jul 2023)◼ Newly attracted tenants: 12 tenants (rents increased on average of 0.7% compared
to before)◼ Free rent: Average 2.5 months.
◼ Increase in rents at time of contract renewal: 6 tenants (average of 11.3% increase
compared to before)◼ No reductions at time of contract renewal.
◼ Rent increases and decrease realized during the lease periods, instead of at the timeof contract renewals. (rent was increased by 5.5%)
increase 2 tenants, decrease 1 tenant<Forecast for FP16 and onwards>◼ Focus on flexible leasing to accurately grasp tenants' relocation needs～ Aim to further increase occupancy rate during the FP16

Number oftenants＜New Contract＞

12

Rent up

7

Same rent

2

Rent down3

Area(㎡)

3,600.57⁃ Average rent increase of 0.7%
2,485.28+ 105 thousand yen/month272.50 ⁃ Average free rent 2,5 months
842.79※ Exclude one tenant whose previous tenant was under a special contract＜Renewal＞

68

Rent up(※)

6

Same rent

58

Rent down

0

18,016.88 ⁃ Average +11.3% increase at
1,175.95 renewal + 406 thousand
yen/month
15,560.55 ⁃ No tenant reduction at the time
0.00 of renewal※ Only tenants whose contracts were up for renewal during the 15th period＜Leaving＞

Contracted occupancy rate / effective occupancy rate6

1,449.15

Contract Rent Period of Office Portfolio
8,000 ㎡

98.0%
97.0%

96.9%

96.0%

※（ ） Number of tenants

6,000 ㎡
4,000 ㎡

95.0%

94.6%

94.0%

2,000 ㎡

93.0%

0,000 ㎡

92.0%

(7)

(19)

(7)

(8)

(14)

(9)

(9)(12)

(12)

(14)

(10)

(13)

(7)

(13)

(13)(13) (7)

(10)

(10)

(7)

第7期
FP7
2019/7

第8期
FP82020/1

第9期
FP92020/7

第13期
FP132022/7

第14期
FP142023/1

第15期
FP152023/7-2,000 ㎡

91.0%※ Effective occupancy rate = (Contracted area - Rent-free area) / Leasable area

2023/72023/62023/52023/42023/32023/22023/12022/122022/112022/92022/102022/82022/72022/62022/52022/42022/32022/22022/12021/122021/11-6,000 ㎡

2021/989.0%

2021/10-4,000 ㎡

2021/890.0%-8,000 ㎡
第10期
第11期
第12期
FP10
FP11
FP12
2021/1 2021/7 2022/1

15

4. Operating results for the 15th fiscal period ended July 2023 (3)- 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）14,800

Average unit rent（yen/tb）

30,000.00㎡

Market Rent（yen/tb）

Rent gap less than0%※（ ）Free Rent
14,60014,567

14,40014,21914,000＋1.1％

14,04013,767＋0.5％

13,80073

20,000.00㎡

14,20013,74615,000.00㎡

Rent gap 10% or more※（ ） Number of tenants

73

25,000.00㎡◼ Achieved increase in rent

Rent gap 0% to less than 10%53

62

10,000.00㎡
13,60013,40013,791

13,86414,014

13,820（2.1M）（2.3M）（1.9M）（2.4M)（2.5M)

11FP（2021/7)

12FP(2022/1)

13FP(2022/7)

14FP(2023/1)

15FP(2023/7)

14

13,8335,000.00㎡

13,2000.00㎡
FP162024/1• 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.

17.2%

225 Tenants

Type

ratio

businesscompany

5.8％

２

Amusement Media Gakuin
Honkan/Shinkan

School3.7％

３Urban Center Hakata

Master lease

3.7％

４

Honmachibashi Tower（Residens）

Master lease

1.7％

５

Urban Center Fujisawabusinesscompany

2.3％

１

Honmachibashi Tower

Total

FP18
2025/1FP192025/7

FP20 or after

2026/1-

Addressing leasing issues

Tenant Diversification

Property nameFP17
2024/7【Urban Center Tachikawa （Tachikawa city, Tokyo）】
Acquisition price

1,804 mil• Started leasing one floor during the FP15 ⇒Occupancy rate of 82.3%

Structure

RC S 6F/1B• Focus on leasing one other floor by holding a tour of thebuilding

Leasable area

3,400.47㎡

Jan 2023

May 2023

Construction
completion

May 1990

65.1 ％

82.3 ％【 The Portal Akihabara（Chuo-ku, Tokyo）】

17.2％

Acquisition price

1,510mil

Structure

SRC 8F

Leasable area

941.69㎡

Construction
completion

May 2002• Contracts have been signed with the next tenants inthe areas vacated in FP15
• Two more tenants have given notice of cancellation. 3
areas are vacant including the current vacancy。1 area
contract to be signed
Nov 2023
Jan 2023
Jan 2023（anticipated）
100.0 ％

86.6 ％

73.2 ％

16

4. Operating results for the 15th fiscal period ended July 2023 (4)- 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 / reevaluation of tenant mix＜Retail Basic Information＞

UrbantypeExecution of strategic leasing

Property nameLocation

Number oftenants

Total floor
area
（㎡）

BAGUS Ikebukuro West

Toshima Ward,
Tokyo

1

1,497.45

100.0%

Abeno nini (Retail)Osaka city,
Osaka

5

3,481.03

100.0%

La Park Kishiwada

Kishiwada City,
Osaka

SuburbanSeiyu Minakuchi
type
Suroy Mall Chikushino

Occupancy rate
(As of Jan 31,
2023)

51

40,566.34

98.9%

Koka City, Shiga

1

23,814.87

100.0%

Chikushino City,
Fukuoka

19

29,364.96

94.5%

77

98,724.65

97.9 %◼

(1) Examination of possible measures to increase traffic to the property; (2) examination of
possible tenant types that would complement existing tenants ➔ commencement ofefforts to attract a supermarket to the property, in light of the high volume of daily traffic itwould bring◼

Through negotiations with existing tenants in the entire building (first and second floor) to
reduce their floor space, secured enough space on the first floor for the prospective new
tenantSucceeded in attracting Lopia, a major supermarket chain<Suroy Mall Chikushino Building layout>

Planned◼ Stable occupancy during the FP15.
◼ In the FP16, plan to replace tenants in Abeno nini (Retail). 2 tenants: Rent is expected toincrease by an average of 13.0% compared to the previous period.
◼ At Shuroy Mall Chikushino, aim for early recovery of temporarily low occupancy rate based on
the ability of "Lopia" to attract customers.

Openingarea（first floor）<Overview of Lopia>“Low-price Utopia”

Revision of Contract Period （ based on floor area ）60,000㎡

Regular lease contrat

50,000㎡(14)Regular lease contrat※（ ） Number of tenants◼

Number of stores: 75 in Japan,
1 overseas (as of June 2023)◼

June 2023: First opened in Fukuoka(Lopia Yodobashi Hakata store)◼

Group-wide sales target of JPY 2 tn
by FY2031

40,000㎡
30,000㎡
20,000㎡
10,000㎡：leasing area

(17)
(13)

(9)

(5)

㎡
16FP
（2024/1)

17FP(2024/7)

18FP(2025/1)

19FP(2025/7)

(4)
(4)

(1)

20FP
(2026/1)

21FP(2026/7)

22FP(2027/1)◼
23FP(2027/7)※ Extract tenants whose contracts will expire by the 23nd fiscal period; 27 tenants (contracted area: approx. 22,281.68㎡)
in the 24rd fiscal period and thereafter：vacant area

：parking area

Unlike most supermarkets, where a centralized team at the head office is responsible for
procurement and development, the head of each sales floor (fresh meat, fresh seafood,
fruits and vegetables, food products, prepared foods) is in charge of their own
procurement, and also participates in developing private-label products, highlighting the 17
company’s strong focus on local store-level efforts

4. Operating results for the 15th fiscal period ended July 2023 (5)- Residence ◆ Occupancy rates during the 15th FP remained at an average of 95% or higher/ The 2 single-type (※1) properties which have high volatility inoccupancy rates have already been sold.
◆ For family type residences (exclusive areas of 30㎡ or more), rent increases have been realized for both new entrants and at time of contract
renewals.

Operating results for Residence

Residential portfolio following the Initiative◼ A particularly high proportion of residential units of 30m2 or more where stable demand is expected◼ Continue to make selective investments in units smaller than 30m 2＜FP15 Actual＞◼ Entering and leaving of tenants ：Area move in（7,830.98㎡）＞ Aria move out （8,264.22㎡）

Averagebuilding age
Before POthe
BeforeInitiative(Note5)
29.0
years
29.0years◼ Entering and leaving, Rent Fee：Total rent（monthly amount） ＋1,089,850 yen
Less than 30㎡
Number oftenants

30㎡ or more

Total monthly
amountNumber oftenants

Total monthly amount

New contract

53△88,450 yen

109＋919,300 yen

Renewal

41

0 yen

247

＋259,000 yen

Cancellation

57

※

－

－

113

Number of units
Leasable area(Note6)
Ratio (based onleasable area)

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

Transition of occupancy rates

Less than 30m2
6,208.67m2 in total

30m2 or more
94,773.68m2
in totalLess than 30m2
259
6,208.67m2

30m2 or more
1,440
94,773.68m2

Total
1,699
100,982.35m2

6.1%

93.9%

100.0%

FollowingtheAfter PO
Initiative(Note5)
25.9
years
25.9 years

Transition of Gross monthly rent ※2

100.0%

97.1%
97.1%

95.0%

96.0%

9.0%
8.0%

7.5%
6.9%

7.0%
6.0%

90.0%
5.0%

Family Type
85.0%

80.0%

4.0%

Single Type

3.0%

Family

Total

2.0%

Total

1.0%
75.0%

FP12

FP13

FP14

FP15

※1singles-type housing : UP Namba, UP Gokokuji, UP Koenji※ 2The “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 2021 (assuming
such amount is 100).

0.0%

FP12

FP13

FP14

FP15

18

4. Operating results for the 15th fiscal period ended July 2023 (6)- 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 I<FP15: actual performance＞◼ Operation status is stable: the average occupancy rate of logistic facilities is 98.6％.
◼ Funabashi Hi-tech Park FactoryⅡ: sold – realized gain-on-sale<Initiatives to be taken from 16th fiscal period and onward＞◼ Logistics facility A: 2 tenants ⇒ 1 tenant - realize increase in rents, increase in rented
space, and cost reduction.
(Lease agreement already signed) – Revenue increase effect of approx.＋7,000,000 yen peryear.
◼ Logistics Facility B: A certain level of capital expenditures were mad in response torequests from tenants⇒ Increased rents.
(Lease agreement already signed) – Revenue increase effect of approx. +6,000,000 yen peryear.
◼ During the 16th FP: Contracts to expire for 2 tenants (12,366.69㎡)
1 tenant: to terminate – Lease contract already signed with existing tenant to increase floor
space.
1 tenant: negotiating renewal of lease contract.

Building extension at Funabashi High-Tech Park Factory I◼ Pursuit of internal growth through the use of unused floor space (two building extensions)◼ An option agreement is signed setting forth a future alteration to the building lease terms,
with new building extension expected to generate additional lease income(Note1)◼ Extension work commenced in June 2023, with completion expected in December

Revision of Rent and Contract Period(㎡)
40,000.00※（ ） Number of tenants(2)

Normal一般

35,000.00

lease

Artist rendering of completed(2)

Fixed-term
定期借家
lease

extension work(1 out of 2)(Note2)

30,000.00

Pre-extension

25,000.00(1)

20,000.00

Post-extension(planned)(1)
8,340.98m2

8,902.08m2

561.10m2(+6.7%)

62.16% / 200%

66.64% / 200%(+4.48%)Acquisition price (Note5)(Indexation preextension = 100)

100.0

117.6

+17.6Pt

Monthly rent index(Note6)(Indexation preextension = 100)

100.0

125.5

+25.5Pt

Total leasable area(Note3)
15,000.00
10,000.00
5,000.00
0.00

(1)

(1)

(1)

Floor-area ratio(Note4)(current/maximum
allowed)

(1)
(0)

(0)

(0)

Increase19

4. Operating results for the 15th fiscal period ended July 2023 (7)- Hotels ①-◆ Received variable rent revenues from “Smile Hotel Namba” and “KOKO HOTEL Osaka Namba” (75 million yen, 2.6 times the preceding
period.)◆ The recovery of hotel operation status is clear - Rev PAR has recovered to the level before COVID-19 (2019).

Operating results for Hotel＜Hotel Portfolio List＞＜Status of FP15＞
Acquisition◼ Received fixed rent + variable rent (from 2 hotels) / variable rent was 75
No.
Name of Property
Datemillion yen, 2.6 times the preceding period.
◼ Hotel A: Still closed due to effects of COVID-19/ planning to reopen by the end Held hotels
of 2023 – rents received as per contract.
HTL-01 R&B Hotel Umeda East
2016.4◼ Hotel B: Period of use as facility for accepting patients with mild symptoms has
HTL-02 Smile Hotel Namba
2016.4
ended – now in discussions towards normal operations.
<Assumptions for FP16 and onward>
HTL-03 REMBRANDT STYLE Tokyo Nishikasa
2017.3◼ Newly acquired 7 properties (September 1, 2023) – assumed that operation
HTL-04 BEST WESTERN Yokohama
2017.3status will improve towards the latter half of the FP17.
◼ Other held hotels – Variable rent revenues expected from hotels other than
HTL-05 The BREAKFAST HOTEL FUKUOKA TENJIN 2018.8“Smile Hotel Namba” and “KOKO HOTEL Osaka Namba”, upside anticipated.
HTL-06 GLANSIT AKIHABARA2018.8◼ Disclosure of hotel KPI -Starting from October 2023, it is planned to disclose
REMBRANDT STYLE Tokyo Nishikasai
the main indices for the preceding month on a monthly basis.
HTL-072018.8Grande(Planning to disclose individual indices for hotels (marked by ●in the righthandHTL-08 KOKO HOTEL Osaka Namba
2018.8table and ◎(Partial)))Floating

○

－

○

●

○

◎

○

◎

○

〇

○

－

○

◎

－

●

2022.8〇－

HTL-10 KOKO HOTEL Ginza 1-Chome2023.9

〇●HTL-11 KOKO HOTEL Sapporo Ekimae2023.9

〇●HTL-12 KOKO HOTEL Fukuoka Tenjin

2023.9

〇●HTL-13 KOKO HOTEL Hiroshima Ekimae2023.9

〇●HTL-14 KOKO HOTEL Kagoshima Tenmonkan

2023.9

〇●HTL-15 Fino Hotel Sapporo Odori

2023.9〇●2023.9

〇●HTL-09 abeno nini (Hotel)＜RevPAR and GOP trajectories>

300.0

Fixed

Newly acquired
200.0
100.0
0.0
-100.0-200.0※ Indexed with January 2019 results as 100

2023/072023/05

2023/032023/01

2022/112022/092022/072022/052022/032022/01

2021/112021/092021/072021/052021/01

2020/112020/09

2020/07

2020/05

2020/032020/01

2019/112019/092019/07

2019/05

2019/03

2019/01-300.02021/03

GOP
系列2

RevPAR
系列1

HTL-16

Best Western Plus Fukuoka Tenjinminami

20

4. Operating results for the 15th fiscal period ended July 2023 (8)- Hotels② ◆ Rent Structure Aligned to Capture Hotel Revenue Growth◆ KPI for hotels to be disclosed from September 2023.(to be announced by the 25th of the following month)

Rent structure of the 7 hotels (Newly Acquired)
SAR’s rent income of
the 7 hotels (Assets to be Acquired)

Disclosure of hotel KPI

Total rent: GOP x 85%(Note1)◼ Starting in September 2023, key figures for the 10 hotels (marked with ● ,◎on
the previous page) that can be disclosed will be disclosed on a monthly basis (tobe announced by the 25th of the following month).
＜Example of disclosure＞

Variable rent
Variable rent = GOP x 85% - fixed rent(Note1)

Fixed rent
Fixed rent (Total of 7 properties) = JPY approx. 50 mn / month(2023/9~2024/8)
JPY approx. 75 mn / month(2024/9 onward)

GOP of the 7 hotels (Newly Acquired)

Fixed / variable rent trajectories(mn）＜Fixed / variable rent trajectories＞
2,000
Fixed
固定

1,500
1,000

500

変動
Variable

Number of

物件数（右軸）Property（Right)

18
16
14
12
10
8
6
4
2
0

21

4. Operating results for the 15th fiscal period ended July 2023 (9)- Hotels③ - Strategic Initiatives in the Hotel Business by Polaris Holdings (affiliate of the Star Asia Group)◆As of June 30, 2023, Polaris Holdings operates 48 hotels with a total of 8,722 rooms (including overseas hotels and hotels planned for operation)◆During the pandemic, Polaris opportunistically increased hotels under operation, increasing revenues and lowering breakeven point

Star Asia Group⚫ Star Asia Group, which has senior investment professionals with deep experience in managing real estate
investments, has joined forces with Polaris (previously Kachikaihatsu Co., Ltd.), an operator of diverse hotels⚫ Together, they are pursuing hotel operations that leverage Star Asia Group’s strong track record inopportunistic investments

Listed on TSE Standard Market

Code: 3010

Hotel operations

Investment management

More efficient hotel operations and maximization of investment value
Expand fee-revenue
hotelsLower breakeven point✓ Increase the number of hotels operating under management contracts, providing the owners withfee-based revenues and reducing the per-room burden of tenancy fees

Promote business as ✓ Eliminate annual fixed rent payment obligation by acquiring properties as owner and operatingowner/operatorsthem as operator.
Effective hotel
operation

Expand operations platform✓ Optimize staff number at each hotel through efficient shift assignments and multitasking which
results in reducing personnel costs on a per-guest-room basis✓ Develop highly competitive hotels and grow the number of guest rooms in hotels undermanagement✓ Pursue economies of scale by expanding the operation platform and maximize revenue

Hotel brands owned by Polaris Holdings

KOKO HOTEL✓ Operates 18 hotels inmajor cities throughout
Japan

Best Western✓ Operates 9 hotels in major
cities throughout Japan asa global hotel brand

Value The Hotel✓ Operates 5 hotels in the
Tohoku region of JapanRed Planet Hotels✓ Operates 14 hotels in
Philippines

224. Operating results for the 15th fiscal period ended July 2023 (10)- Financial standing ◆ Newly called upon 4 banks. To prepare for future rise in interest rates, plan the timing to fix interests while considering costs.
◆ Periodic rating reviews by the 2 rating agencies are expected to be conducted within the year.

Main financial indicators (※1）

Bank formation (as of Dec 1, 2023）

FP14
Jan 2023

FP15
Jul 2023

As of Dec 1, 2023

LTV

46.4 %

46.3 %―

Interest-- bearing debt balance

96,840 mn

96,840 mn

123,140 mn

100.0 %

Long-term debt ratio

100.0 %

100.0 %

Average remaining period tomaturity

2.9 years

3.0 years

3.4 years

Average borrowing period

5.1 years

5.1 years

5.3 years

Average interest rate (※2)

0.78 %

0.80 %

0.79 %

Fixed interest rate ratio

95.1 %

95.1 %

71.6 %(※1) This describes the status including investment corporation bonds. It is assumed that the borrowings
maturing on September 20, 2023 will be refinanced under the previous terms. The same applies below.
(※2) The interest rates shown take into consideration the effects of interest rate swaps (fixing of interest rates).

Lender

Ratio

LenderSumitomo Mitsui Banking

23.1%

1.2%

Mizuho Bank

18.6%

The Nishi-Nippon CityBank
The Bank of
Yokohama,Ltd.

SBI Shinsei Bank

13.8%

San-ju San Bank

0.8%

11.7%

0.8%

0.8%

Interest-- bearing
debt balance

Sumitomo Mitsui Trust
Bank

Fixed
固定

(mil）

Floating
変動

Corporation
投資法人債Bonds

1,000

12,000Aozora Bank

9.4%

Resona Bank

6.3%

Corporation Bonds

0.8%

123,140

The Bank of Fukuoka

2.2%

0.7%

million yen

Minato Bank

1.6%

The Kiyo Bank, Ltd

1.6%

The Chiba Bank, Ltd

1.6%

Mizuho Trust &Banking
The Dai-ichi Life
Insurance
Fukoku Mutual Life
Insurance Company
The Yamagata Bank,Ltd

The Asahi Shinkin Bank

1.6%

0.4%
0.4%
0.4%

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

Long-term Issuer RatingA (Stable)

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

Issuer Rating
A－ (Stable)

3,200

10,000

1.3%

The Juhachi-Shinwa
Bank, LtdThe Musashino Bank,
Ltd

Diversification of repayment dates(as of Dec 1, 2023)
14,000

Ratio

Transition of LTV

1,000

8,000

49.0%

9,730

48.0%

6,000
4,000
2,000

11,850
9,060

8,500

12,07011,89011,215
8,750

47.3%

47.0%

9,700 9,790

46.0%

7,300
5,085

45.0%
3,000
44.0%

FP17 FP18 FP19 FP20 FP21 FP22 FP23 FP24 FP25 FP26 FP27 FP28 FP29 FP30

FP15,
46.3%

43.0%
FP1 FP2 FP3 FP4 FP5 FP6 FP7 FP8 FP9 FP10 FP11 FP12 FP13 FP14 FP15 FP17

23

4. Operating results for the 15th fiscal period ended July 2023 (11)- Capex Control –◆ Implement strategic capital expenditures (expansion construction, etc.) related to internal growth measures in the FP15 and FP16
(planned)◆ Execute asset replacement in line with the timing of strategic capital expenditures and repair and maintenance expenses (obtainfunds and gains on sales)
Capex予算
Capex
Forecast(Unit: thousand yen)

Depreciation
cost
減価償却費（実績）

Capex
ActualCapex実績

Depreciation
cost (Forecast)
減価償却費（予想）

Capex Management＜FP16 Forecast＞

1,400,000•◼ Extension of Funabashi Hi-Tech Park Factory I◼ Suroy Mall Chikushino Construction by lessor for opening of "Lopia"

1,200,000•

Total ：approximately 346 million yen
1,000,000

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.

＜FP15 Actual＞◼ Strategically, use proceeds from the sale of the property tocarry out construction work ahead of schedule, focusing onlarge-scale projects.

800,000＜Capital Expenditures for the 15th fiscal period＞

600,000

REMBRANDT STYLE Tokyo Nishikasai
Renewal of water generator

43 million yen

Seishin BLDG.
Entrance renewal work

36 million yen

400,000＜Schedule of Capital Expenditures for the 16th fiscal period＞

200,000
0
第10期
第11期
第12期
第13期
第14期
第15期
第16期
第17期
FP11
FP13
FP12
FP14
FP15
FP10
FP16
FP17
2021年1月期
2021年７月期
2022年1月期
2022年7月期
2023年1月期
2023年7月期
2024年1月期
2024年7月期
2021/72022/72022/12023/12023/72021/12024/12024/7

FP10
Jan 2021
ActualFP11
Jul 2021
ActualFP12
Jan 2022
ActualFP13
Jul 2022
ActualSuroy Mall Chikushino
Store area construction

100 million yen

Higashi-Kobe Center Building
Elevator renewal construction

99 million yen(Unit: thousand yen)FP14
Jan 2023
ActualFP15
Jul 2023
Actual16FP
Jan 2024
Forecast

FP17
Jul 2024
Forecast

Depreciation cost

628,354

633,013682,245

697,599743,661

763,353

953,477

1,024,215

Capex Forecast

552,841

453,448507,750

520,543

628,409871,225

1,151,708

867,234

Capex Actual

331,901

363,439424,722471,534

605,932

787,991――

Capex Budget reduction rate

40.0%

19.8%

16.4%

9.4%

3.6%

9.6%

―

―

Capex ratio （Capex Actual／
Depreciation cost）

52.8%

57.4%

62.3%

67.6％

81.5%

103.2%――

Repair cost（Actual／Forecast）

181,949

220,204

181,998

255,201

173,257

308,817272,640

234,380

53

53

60

60

63

62

71

71

Number of Properties as of the end
of FP

24

5． Progression Status of Mid-Term Plan25

5． Progression Status of Mid-Term Plan (1)Progression Status of Mid-Term Plan
◆ Asset size in December 2023 through public offering: 242.2 billion yen (real estate, etc.: 71 properties, preferred securities: 1deal), other mezzanine loan claim investments: 2 deals◆ Assumed distribution per unit: 1,538 yen (distribution guidance per unit)

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 Dec. 2023
Assets Size
As of the end of December 2023

242.2 billion yen

Achievement rate ： 81％

Distributions Per Unit
Cruising Distributions Per Unit

1,538 yenAmount to be achieved ： 62 yen

Future portfolio expansion and formulation policy:➢ Utilize the sponsor pipeline including development deals, andfind deals using the asset management company’s unique
network.
➢ As a comprehensive REIT, while taking into consideration thecurrent portfolio mix, aim for external growth through not only
properties for which first refusal rights are obtained, but also by
combining with other asset type properties (main scenario).
➢ If the improvement of operational status of hotels and thecruising level can be confirmed, also eye the possibility tofurther increase the composition ratio of hotels (sub-scenario).

Priority measures going forward:➢ Consideration of measures to improve earnings, such asredevelopment and expansion of owned properties➢ Cooperate with sub-sponsor (Nippon Kanzai Group)➢ Rebuild the property management system to suit the portfoliomix.
➢ Reduce costs leveraging on the economy of scale➢ Optimize repair costs/ capital expenditures.
➢ Improve distribution per unit through external growth, internal
growth.
26

5． Progression Status of Mid-Term Plan (2)SAR has Obtained Preferential Negotiation Rights for 12 Hotels Owned by Star Asia Group◆Star Asia Group significantly increased its investment in hotels by taking advantage of opportunities to buy hotels◆SAR has obtained preferential negotiation rights for 12 hotels totaling JPY 57.6 bn

Hotel portfolio owned by Star Asia Group
increased during the COVID-19(Note1)

Newly obtained preferential negotiation rights for 12 hotels<Change in properties owned by Star Asia Group (Total appraisal value(Note2))>(JPY 100 mn)

KOKO HOTEL
Tsukiji Ginza

KOKO HOTEL
Nagoya Sakae

KOKO HOTEL
Osaka Shinsaibashi

KOKO HOTEL PremierKanazawa Korinbo

Over the past approx.4 years,
the hotel portfolio has
grown by 10.5 times
KOKO HOTEL
Premier Kumamoto

As of the end ofJune 2019

As of the end of
May 2023◼ Although there was uncertainty over hotel operations during the COVID-19, Star
Asia Group significantly increased its hotel portfolio after undertaking deep analysisof the market environment for real estate and future recovery of demand foraccommodations◼ Leveraging its strengths in consistently executing investment strategies based onmarket foresight, Star Asia Group is providing strong support for SAR’s external
growthMIMARU Tokyo
Ueno East

KOKO HOTEL Residence KOKO HOTEL Residence
Asakusa Tawaramachi
Asakusa Kappabashi

GATE STAY Premium
Nihonbashi

GATE STAY Premium
Ginza Shintomicho

MIMARU Tokyo Ginza
EAST

MONday Apart Premium
Ueno◼ Overview of the hotel portfolio with preferential negotiating rights✓ Number of properties: 12✓ Total number of guest rooms: 1,364✓ Total appraisal value: JPY 57.6 bn✓ Ratio operated by Polaris(Note3):
65.2%

27

5． Progression Status of Mid-Term Plan (3)Strengthening the Portfolio Through Strategic Asset Replacements◆ Realization of gains from asset sales executed for asset replacements, and diversification of the asset mix◆ Ongoing strategic active asset management efforts that go beyond asset replacements
Strengthening of portfolio through strategic asset replacements and building extensions
Sales strategies

Building age:
21.8 years

Building age:33.3 years

Building age:
35.7 years◼ Divestitures of older properties withlimited growth potential relative tothe increase in expenses, including
future capital expenditures◼ SAR intends to use gains on sale for
returns to unitholders in the form of
dividends◼ Gains will also be used to fundefforts designed to drive internal
growthFunabashi Hi-Tech Park Factory II

Urban Park Koenji

Asset type

Logistics

Asset type

Residential (single)

Asset type

Residential (single)

Sales price

JPY 1,150 mn

Sales price

JPY 1,800 mn

Sales price

JPY 1,315 mn

JPY 414 mn

Anticipated gain
on disposal

JPY 271 mn

Anticipated gain
on disposal

JPY 109 mn

Gain on disposal

8th Asset Replacement
Announcement: Feb. 1, 2023

Acquisition strategies

Urban Park Gokokuji

9th Asset Replacement
Announcement: Mar. 16, 2023

Star Asia Mezzanine Loan Debt
Investment Series 8

Focus onmaximizationof unitholder
returns

10th Asset Replacement
Announcement: Aug. 7, 2023

Building age:
5.4 years

Newly constructed
property(Centurion Hotel Grand Akasaka)◼ Improve profitability and quality ofoverall portfolio through acquisitionsof relatively new built properties◼ Acquire diverse mix of assets,
including non-real estate assets◼ As a strategic capital investment,
building extensions and others areplanned to be executed

Acquisition
dateClass A beneficiaryinterest: Sep 13, 2023
Class B beneficiaryinterest: Feb. 20, 2023

Class A / B beneficiaryinterest:
JPY 430 mn / 340 mn
Class A / B beneficiaryinterest:
Dividend yield
3M TIBOR+5.30% / +7.30%

Acquisition
price

Anticipatedappearance atcompletion

GSA JP Project 1
SPC preferred equity securities(HAKUSAN HOUSE)

Urban Park Umejima(Residence (single))

Acquisition price

JPY 1,562 mn

Anticipatedacquisition date
Anticipatedacquisition priceRent

4.0% per annum

Appraisal NOI yield

Acquisition dateJun. 23, 2023

Dec. 1, 2023
JPY 1,032 mn
4.1%

28

5． 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 8.82 bn(As of the end of the FP ended 7/2023)

Use retained earnings to stabilize distributions
Defensive
Dealing with the temporary reductions in revenue
due to PO costs, the impact of COVID-19, etc.
FP14 Actual(ended 1/2023)
FP15 Actual(ended 7/2023)
FP16 Forecast(ended 1/2024)
FP17 Forecast(ended 7/2024)

Drawdown of retained
earnings

JPY 80 mn
Drawdown of retained
earnings

JPY - mn
Drawdown of retained
earnings

JPY 290 mn
Drawdown of retained
earnings

JPY 130 mn

DPU+JPY 44
Planning capital expenditures
which will directly connect toincrease in revenues

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

Specificplanning / startof construction

Construction /completion

BeforePostredevelopment
operation

After

DPU

+JPY 124DPU+JPY 55

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
29

5． Progression Status of Mid-Term Plan (5)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
1st follow-on
offering
March 17, 2017

IPO
April 20, 2016
1st asset
replacement
December 5, 2016

2nd asset
replacement
February 28, 2017

2nd follow-on
offering
January 12, 2018

3rd asset
replacement
July 23, 2018

3rd follow-on
offering
August 21, 2018

4th asset
replacement
August 21, 2018

5th asset
replacement
March 2, 2020

MergerAugust 1, 2020
6th asset
replacement
October 5,2020

4th follow-on
offering
August 2, 2021
7th asset
replacement
November 30,2020

5th follow-on
offering
August 1 2022

8th asset
replacement
February 1,2023

9th asset
replacement
March 16,2023

6th follow-on
offering
August 7 2023
10th asset
replacement
August 7,2023

(yen)

(mn)

70,000140,000
Market capitalization(Right）

65,000SAR(Left)
TSE REIT(Left)

120,000

60,000100,000
55,00050,00080,00045,00060,00040,00040,00035,00020,00030,00025,000*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.

30

6．Summary of Newly Acquired31

6． Summary of Newly Acquired (1)Hotels with upside potential in Internal Growth◆Located in Central Ginza, one of the most highly sought after commercial areas in Japan—hotel with high scarcity value◆Convenient location—there are five JR and metro lines all within 7 minute walk
KOKO HOTEL Ginza 1-chomeHigh scarcity value, as a hotel in Ginza
Hotels owned by
J-REITs
Acquisition price of JPY
15.0 bn or more

Ginza address(Note4)

As of the end of June
2023, no properties
owned by J-REITs meet
all these conditions,giving that this property
high scarcity value

Within 1 minute walkfrom the closest station
Acquisition price:

Appraisal value:

Appraisal NOI yield:

JPY 17,800 mn

JPY 18,600 mn

4.0%

Features of the Assets to be Acquired➢ High competitive hotel located in Ginza, oneof the most sought after commercial areas inJapan

Overview of property
Asset type

Hotel

Keisei Ueno

Location

Chuo-ku, Tokyo

Ueno➢ Convenient location--Only approx. one
minute walk to the nearest station, YurakuchoLine “Ginza 1-chome”, making the hotel very Structure/ floors(Note1)
convenient for guests➢ Superior location and the scarcity of hotels in
the area to attract both business demand andtourists demand

Locational advantages for a hotel in Ginza➢ This property is located in Ginza 1-chome, with superb access to themetro(railways), and expressways, and meets the needs of both businessand leisure travelers
Required time to reach this property

Total floor area (m2)

SRC / 12F
(with 1 basement
floor)

Tokyo

Yurakucho

7,299.11
October 2014

Number of guest rooms

305

NaritaAirport

10
min.

5
min

Shinjuku

Hamamatsucho(Note2)Completion date(Note3)

70
minShibuya

Ginza

1
min
Ginza 1chome45
minHanedaAirport32

6． Summary of Newly Acquired (2)Hotels with upside potential in Internal Growth

KOKO HOTEL Sapporo Ekimae / Fino Hotel Sapporo Odori
Features of Assets Acquired<KOKO HOTEL Sapporo Ekimae>➢ KOKO HOTEL Sapporo Ekimae is located approx. 4 minute walk from “Odori” Station on the Sapporo
Municipal Subway Tozai Line, giving it excellent traffic access and close to Sapporo Ekimae Street, amajor tourist boulevard, where is flourishing area.
➢ Suitable for business and leisure travel as therooms are mostly semi-double, double andtwin rooms accommodating two or more people<Fino Hotel Sapporo Odori>

KOKO HOTEL Sapporo Ekimae

Fino Hotel Sapporo Odori

Acquisition price:

Appraisal value:

JPY 6,700 mn /JPY 4,200 mn

JPY 7,040 mn /JPY 4,250 mn

Property
overview

Asset type

KOKO HOTEL
Sapporo Ekimae

Appraisal NOI yield:

4.9% / 4.6%

Fino Hotel
Sapporo Odori

Hotel

Hotel

Chuo-ku, Sapporo City,
Hokkaido
S / 12F(with 1 basement floor)

Chuo-ku, Sapporo City,
Hokkaido

5,886.67

3,854.01

Completion date

October 2015

June 2020

Units / Rooms

224

145

Location
Structure / floors
Total floorarea (m2)➢ Fino Hotel Sapporo Odori is a highly visible hotel
located approx. 3 minute walk from “Odori” Stationon the Sapporo Municipal Subway Nanboku Line,and high visibility due to being situated along thetram line running through Sapporo’s main street➢ Because most rooms are either doubles or twin,with rooms for four also available, the hotel is very
appealing for group and family travelers➢ Both hotels have the right location and room composition
to become popular tourist accommodations, and a rise in hotel demand will likely further increase
profitability

Trends in Sapporo area tourism demand➢ While international passengers arriving at New Chitose Airport have been recovering since the fall of2022, numbers are still approx. 50% below the same month in 2019
➢ The monthly number of tourists visiting Sapporo, including foreigners, has stayed below 1mn, yet torecover to 2019 levels<International passengers at
New Chitose Airport (vs. 2019)><Tourists visiting Sapporo>(10k people)
Tourists visiting
SapporoRC / 10F

Source: Created by the Asset Manager based on “Statusof Airport Management” by MLIT and “Statistics on Usageof Managed Airports” by East Japan Civil Aviation Bureau

Source: Created by the Asset Manager based on
tourism statistics by Sapporo City33

6． Summary of Newly Acquired (3)Hotels with upside potential in Internal Growth

KOKO HOTEL Hiroshima Ekimae

KOKO HOTEL Kagoshima Tenmonkan

Features of the Asset Acquired

Features of the Asset Acquired➢ KOKO HOTEL Hiroshima Ekimae is located approx. 5
minute walk from “Hiroshima” Station on the JR line
and has high visibility due to being situated along themain street, and highly accessible➢ Hiroshima City, the center of the Chugoku region, hasmany corporate headquarters and branches, and thehotel is close to the entertainment districts of
Kamiyacho, Nagarekawa and Hatchobori, so thelocation may attract business travelers➢ With good access to the Peace Memorial Park, whichhouses the Atomic Bomb Dome, and the world cultural
heritage site Itsukushima Shrine, it is also expected to
attract tourists, including foreign visitors➢ With business demand likely set to recover, theproperty shows great potential for revenue growth➢ KOKO HOTEL Kagoshima Tenmonkan is located approx. 4minute walk from “Tenmonkan-dori” Station on the
Kagoshima City Tram, and approx. 3 minute walk from the“Tenmonkan” stop on the Kagoshima Airport Shuttle Bus,
providing easy access to “Kagoshima” Airport, and highly
accessible➢ Kagoshima City has many branch offices of public
institutions and major corporations, and the hotel is locatedin Tenmonkan area, the largest shopping district in the city,
making it convenient for business travelers➢ The expansion and renovation of the international terminalbuilding at “Kagoshima” Airport was completed in 2020,
and the number of travelers is expected to grow after
COVID-19 with increased capacity of the airport➢ With its location inside a major entertainment district andexcellent traffic access, a rise in hotel demand is expected
to increase revenue

Acquisition price:

Appraisal value:

Appraisal NOI yield:

Acquisition price:

Appraisal value:

Appraisal NOI yield:

JPY 4,100 mn

JPY 4,280 mn

5.2%

JPY 3,800 mn

JPY 4,260 mn

6.1%

Property overview

Property overview

Asset type

Hotel

Asset type

Hotel

Location

Minami-ku, Hiroshima
City, Hiroshima

Location

Kagoshima City,
Kagoshima

Structure / floors
Total floor area (m2)

SRC / 14F (with 1
basement floor)
5,370.75

Structure / floors

RC / 13F

Total floor area (m2)

4,622.48

Completion date

December 2019

Completion date

April 2019

Units / Rooms

250

Units / Rooms

295

34

6． Summary of Newly Acquired (4)Hotels with upside potential in Internal Growth
KOKO HOTEL Fukuoka Tenjin / Best Western Plus Fukuoka Tenjin-Minami
Features of Assets Acquired<KOKO HOTEL Fukuoka Tenjin >➢ KOKO HOTEL Fukuoka Tenjin is highly accessible and located approx. 4 minutes from “Tenjin Minami”
Station on the Nanakuma Line and offers easy access to the Tenjin Station area, a major commercial
hub in Fukuoka➢ Most rooms are either doubles or twins and helps the hotel
appeal to both tourists and business travelers<Best Western Plus Fukuoka Tenjin-Minami>

KOKO HOTEL
Fukuoka Tenjin
Acquisition price:

Best Western Plus
Fukuoka Tenjin-Minami
Appraisal value:

JPY 5,000 mn / JPY 3,800 mn JPY 5,370 mn / JPY 4,390 mn

Appraisal NOI yield:
4.9% / 6.7%

KOKO HOTEL
Fukuoka Tenjin

Best Western Plus
Fukuoka Tenjin-Minami

Asset type

Hotel

Hotel

Location

Chuo-ku, Fukuoka City,
Fukuoka

Chuo-ku, Fukuoka City,
Fukuoka

Structure / floors

RC / 14F

S / 13F

Total floor area (m2)

4,404.91

7,322.03

Completion dateAugust 2007

April 2020

Units / Rooms

159

236

Property overview➢ Best Western Plus Fukuoka Tenjin Minami is located approx.
5 minutes from Tenjin Minami Station on the Nanakuma
Line and approx. an 11 minute walk from Tenjin Station on
the Airport Line➢ The Best Western Plus is within easy walking distance of
the Tenjin Station area and Hakata Nakasu area, bothvery popular entertainment districts and putting the hotel in
excellent position to draw tourists➢ Additional runways are expected to come into service
at Fukuoka Airport in 2025—the number of traveler capacity is expected to increase significantly➢ With its close proximity to a major commercial hub and the expected increase in tourists traveling by air,a rise in hotel demand is expected to increase revenue from both hotels.

Trends in Fukuoka Tenjin area tourism demand➢ From 2023 foreign arrivals at Fukuoka Airport and Hakata Port have recovered significantly, but the
number of tourists arriving by cruise ship remains below previous levels; as boat travel returns to fullswing and tourism from China recovers, demand is expected to grow much further➢ The high domestic and foreign tourism demand had led to an increase in room supply, even during the
COVID-19, and occupancy rates in 2022 showed signs of recovery<Foreign arrivals at Fukuoka
Airport and Hakata Port>(10k people)<Fukuoka City rooms and occupancy rates>(Rooms)

Source: Created by the Asset Manager based on Ministry of Justice ”Immigration Control Statistics”, Japan
Tourism Agency “Overnight Travel Statistics Survey” and Fukuoka city sightseeing statistics“Sightseeing of Fukuoka city and MICE 2018 year edition and 2023 year edition”

35

6． Summary of Newly Acquired (5)Residences Expected to Provide Stable Revenues

Urban Park Mitaka

Urban Park Umejima

Features of the Asset Acquired

Features of the Asset to be Acquired➢ Urban Park Mitaka is located approx. 16 minute walkfrom “Mitaka” Station on the JR Chuo Line, with close
access to “Shinjuku” Station (approx. 14 minutes) and“Tokyo” Station (approx. 35 minutes). It has excellent
commuting convenience with easy access to central
Tokyo➢ In addition to commercial facilities that enhance living
convenience, the area also has a nice living
environment with cultural centers, parks, and lots ofgreenery➢ A new three-story residential building completed inJune 2023 with the latest housing equipment. The
residence primarily targets families (average exclusive
area of 84㎡ or more), with 3LDK and 4LDK floor plans➢ Being freshly constructed and offering an excellent
environment with plenty of livable space, the property
will be highly appealing for families and is expected tomaintain a high level of occupancy➢ Urban Park Umejima is located approx. 12 minute walkfrom “Umejima” Station on the Tobu Isesaki Line, withclose access to central business areas; in approx. 35
minutes ride to “Tokyo” Station via “Ueno” Station on
JR Line➢ The residence with a location that has many
convenient facilities such as Umejima Ekimae-dori
shopping street, hospitals, schools, and clinics. In
addition to commercial facilities that enhance theconvenience of living, the area also has good living
environment with parks and lots of greenery➢ A new residence is to be completed in November 2023
with the latest housing equipment with floor plans
ranging from 1K to 2LDK, highly appealing to singles
and small families➢ Being freshly constructed and offering excellent traffic
access, the property is expected to maintain a highlevel of occupancy

Anticipatedappearance atcompletion

Acquisition price:

Appraisal value:

Appraisal NOI yield:

Anticipated acquisition price:

Appraisal value:

Appraisal NOI yield:

JPY 743 mn

JPY 1,010 mn

5.0%

JPY 1,032 mn

JPY 1,140 mn

4.1%

Property overview

Property overview

Asset type

Residence

Asset type

Residence

Location

Mitaka City, Tokyo

Location

Adachi-ku, Tokyo

Structure / floors

S / 3F

Structure / floors

RC / 5F

Total floor area (m2)

1,201.39

Total floor area (m2)

1,805.78

Completion dateJune 2023

Completion dateNovember 2023
(Scheduled)

Units / Rooms

14

Units / Rooms

46

36

6． Summary of Newly Acquired (6)Residences Expected to Provide Stable Revenues

Urban Park Kamata-Minami I / Urban Park Kamata-Minami II
Features of Assets to be Acquired

Anticipatedappearance atcompletion

Urban Park Kamata-Minami I

Urban Park Kamata-Minami II

Anticipated acquisition price:

Appraisal value:

Appraisal NOI yield:

JPY 641 mn / 1,375 mn

JPY 864 mn / 1,720 mn

5.0% / 4.7%

Property overview

Urban Park Kamata-Minami I

Urban Park Kamata-Minami II

Asset type

Residence

Residence

Location

Ota-ku, Tokyo

Ota-ku, Tokyo

Structure / floors

RC / 5F

RC / 6F

Total floor area (m2)

1,239.35

2,323.83

Completion date

September 2022

October 2023 (Scheduled)

Units / Rooms

36

71➢ Urban Park Kamata Minami I and II are located approx. 10 minute walk from “Zoshiki” Stationon the Keikyu-Main Line and approx. 12 minute walk from “Kojiya” Station on the Keikyu
Airport Line with close access to business andcommercial areas in Tokyo Area. “Tokyo” Station
can be reached in approx. 32 minutes via JR lines,“Keikyu Kawasaki” Station in approx. 3 minutes
via Keikyu-Main Line, and “Yokohama” Stationin approx. 18 minutes via JR lines➢ Urban Park Kamata Minami I was completed on
September 29, 2022, and Urban Park Kamata
Minami II is a new residential building scheduled
for completion on October 31, 2023, with the latest
housing equipment. The Urban Park Kamata
Minami I has 1DK and 1LDK, and the Urban Park
Kamata Minami II has 1R to 2DK, which are highly appealing to singles and small families➢ With the number of households in Ota-ku on the rise, and the property being relatively new
with excellent traffic access, it is expected to maintain a high level of occupancy

Demographics of Ota-ku, Tokyo➢ The population of Ota-ku has remained stable since 2016
➢ The number of households has been increasing modestly(10k people)(10k households)

00

Source: : Created by the Asset Manager based on “The Basic Resident Register” by Ota-ku, Tokyo
Note: Figures for population and number of households are as of July 1 of each year37

7．Initiatives on ESG

38

7. 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.
39

7. Initiatives on ESG (2)E (Environment) related Numerical Goals and their Achievement Status◆ While total energy consumption increased in 2022 due to the recovery of hotel occupancy rates, the energy consumption intensity fell 14.7% measured against
the 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
GHG emissions

t-CO2

Base year(2019)
23,154.05

Scope 1t-CO2

1,968.71

1,129.44

1,672.17

1,953.58-

Scope 2t-CO221,185.34

15,675.06

18,458.26

18,635.41-

t-CO/m2

0.057120.040570.040970.04051

0.05140-▲ 29.0%▲ 28.3％▲29.1％▲ 10.0%

Crude oil equivalent
Unit
monitoring item
Crude oil equivalent usage amountkL
Crude oil equivalent usage per unit kL/m2
Reduction rate%

Base year(2019)
11,220.81
0.02768-

2020
Actual9,156.34
0.02210▲ 20.1%2021
Actual11,234.60
0.02286▲ 17.4%2022
ActualTarget year
(2030)
12,001.80
0.02491
0.02362▲14.7％ ▲ 10.0%

Energy consumption
monitoring item
Energy consumption
Energy consumption per unit
Reduction rate

Base year(2019)
44,560.98
0.10992-

2020
Actual36,362.39
0.08778▲ 20.1%2021
Actual
44,615.75
0.09080▲ 17.4%2022
Actual

GHG emissions intensity(Note 2)
Reduction rate

Water consumption
monitoring item
Clean water usage
Clean water usage intensity
Reduction rate
Waste
monitoring item
Waste emissions
Coverage rate
Waste emissions intensity
Reduction rate

Unit

%

Unit
MWh
MWh/m2
%
Unit
m3
m3/m2
%
Unit
t
%
t/m2
%

2020
Actual
16,804.50

2021
Actual20,130.43

2022
ActualTarget year
(2030)
20,588.99

Target year
(2030)
47,662.51
0.09893
0.09379▲14.7％ ▲ 10.0%

Base year
2020
2021
2022
Target year
(2019)
ActualActualActual(2030)
329,687.35 220,847.18 255,933.91 334,463.31-0.8133
0.53310.52090.8133≦0.6581▲ 34.4%▲ 36.0%±0%▲19.1％
Base year(2019)
2,693.27
69.1%
9.61
-

2020
Actual
1,656.50
65.1%
6.14▲ 36.1%2021
Actual3,164.05
70.4%
9.14▲ 4.9%

Goal: 10% of reduction frombase year by 2030
Reduction rate: 29.1%

Goal: 10% of reduction frombase year by 2030
Reduction rate: 14.7%

2022
ActualTarget year
(2030)
3,825.29
79.6％≦ 9.61
9.46
±0%
▲1.6％

40

7. Initiatives on ESG (3)Initiatives for E (Environment) and S (Society)◆ Considering acquiring environmental certification for newly acquired properties as well.

◆ As an initiative for S (Society), a tenant satisfaction survey has been conducted. Considered ways to reflect the results of the survey in management andoperations.

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 ㎡

Honmachibashi Tower

Office15,407.83 ㎡

La Park Kishiwada

Retail

65,663.02 ㎡

Urban Park Tokiwadai
Koen

Residence

15,708.08 ㎡

Urban Park Mitsuike Koen

Residence

10,918.37 ㎡

Iwatsuki Logistics

Logistics

29,729.72 ㎡

Seishin Building

Office7,624.66 ㎡

Seiyu Minakuchi

Retail31,829.71 ㎡★★★

Urban Center Hakata

Office3,566.56 ㎡★★

Urban Park
Miyamaedaira (Note 5)

Residence

2,039.17 ㎡

Rank S

Higashi-Kobe Center
Building

Office25,740.46 ㎡

Urban Park Daikanyama

Residence

8,261.29 ㎡

abeno nini (retail)

Retail

4,866.82 ㎡

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 119 office tenants, 30 retail tenants, 6 residence tenant, 9 logistics tenants,
and 2 hotel tenants.（25.2 % of leasable area）◼ SAR plans to add the same clause to other properties

166 tenants

Total leased area

15,651.91

㎡

32.8％

Initiatives for S (Society)◆Initiatives for employees★

BELS
Certification

Signing of green lease contracts (Note 6)

2.7％◆Initiatives on own Property◼ Kishiwada Environment Fair 2023
7.3％

Rank A

Total計Goals：50％（2026）

229,132.88 ㎡◼ Diversity & inclusion (one director and one Auditor are 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

42.8％

A panel exhibition of environmental protection initiatives taken by Kishiwada Cityand various groups.
Based on the advocation by the Environment Agency, June has been designatedas Environment Month, and initiatives were taken to promote interest andunderstanding of environmental protection matters, and awareness campaigns
were launched to increase motivation towards proactive promotion activities.

◆Tenant satisfaction surveys◼ Tenant satisfaction surveys are conducted periodically inorder to enhance tenant satisfaction41

7. Initiatives on ESG (4)Governance ①

Same 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 Jul
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 Jul 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

FP14

FP15

Management fees I

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

145,318 thousand yen

143,722 thousand yen

Management fees II

NOI × 7.5% (upper limit)

279,092 thousand yen

271,363 thousand yen

Acquisition fees

Acquisition price × 1.0％ (upper limit) ※151,140 thousand yen

19,025 thousand yen

Transfer fee

Assignment price× 1.0％ (upper limit) ※－11,500 thousand yen

Merger fee

Valuation amount of held assets× 1.0％
(upper limit) ※－－※： 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 Committee42

7. Initiatives on ESG (5)Governance ②Star 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.

43

8．Appendix

44

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 JPY1,15 trillion and has current assets under management of around
JPY501.5 billion1.

➢

Star Asia Group has 593 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
Asset manager
Listed J-REITStar Asia
Investment
Management Co.,Ltd.

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

Star Asia Asset Advisors:• Registered for Financial
Instruments Business (2nd
Financial Instruments,
Investment Advisory, Agency
and Investment Management*)
with Kanto Financial Bureau

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

• Sponsors andsupports other group
entities providing
strategic and technicaladvice as well as
leadership resourcesStar Asia
Investment
Corporation

Property Development

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
28hotels and 4,962
rooms currently undermanagement acrossJapan (as of March
2023)• 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 March 2023. US$ = JPY132.86
As of March 2023. Includes officers and employees of affiliated entities not shown above.

45

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 against the 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.

46

Status of Unitholders
at the End of 15th Fiscal Period ended July 2023
List of major unitholders (Top 10)

Number of investment units by attribute: Total 1,921,689 units
End of 14FP

End of 15FP

Unitholder nameCategory
No. ofinvestment units

No. ofinvestment units

Ratio

Ratio

Individual

489,94325.5%

478,202

24.9%

Financial institution

629,81632.8%

616,94432.1%

69,783

3.6%

85,433

4.4%

Domestic
corporation
Foreign
Securities company

Total

663,05034.5%

677,48835.3%

69,097

3.6%

63,622

3.3%

1,921,689

100.0%

1,921,689

100.0%

Number ofinvestment
units

Holdingratio

1

Custody Bank of Japan, Ltd.
(Trust Account)

216,287

11.3%

2

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

216,135

11.2%

3

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

91,697

4.8%

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

81,356

4.2%

5

STATE STREET BANK AND TRUSTCOMPANY 505001

47,352

2.5%

6Star Asia Capital Ⅰ LLC

40,9692.1%

6Star Asia Capital Ⅱ LLC

40,9692.1%

6Star Asia Capital Ⅲ LLC

40,9692.1%

6Star Asia Capital Ⅳ LLC

40,9692.1%

10JP Morgan Chase Bank 385771

29,081

1.5%

Total

845,784

44.0%

Number of unitholders by attribute: Total 28,411
End of 14FP

End of 15FP

Category
No. ofunitholders

No. ofunitholders

Ratio

Ratio

28,16997.3%

27,652

97.3%

48

0.2%

47

0.2%

Domestic
corporation

413

1.4%

377

1.3%

Foreign

309

1.1%

313

1.1%

26

0.1%

22

0.1%

28,965100.0%

28,411100.0%

Individual
Financial institution

Securities company

Total

Star Asia Capital Ⅰ～ⅣLLC are Sponsor Group.

47

Change in business results(Unit: million yen)

Lease business revenue
Office rent
Retail rent
Residence rent

Logistics rent
Hotel rent
Other
Expenses related to rent
business(Depreciation is excluded)
NOI
Depreciation
Rent revenues/expenses
Mezzanine
TK distribution
Income from securities lending
fees
Gain on sale of real estate
property
Loss on sales of real estate
property
SGA

Operating income
Non-operating income
Non-operating expenses
Ordinary income
Extraordinary income
Income before income taxes
taxes
Net income
Cash distribution per unit
FFO per unit※2
Balance of Internal reserves※3

10FP (ended Jan.
2021) actual

11FP (ended Jul.
2021) actual

12FP (ended Jan.
2022) actual

13FP (ended Jul.
2022) actual

14FP (ended Jan.
2023) actual

15FP (ended Jul.
2023) forecast
（※1）

5,648
1,895
848
889
974
423
616

5,536
1,807
790
1,023
909
424
582

5,890
1,900
842
1,152
910
425
660

6,060
1,974
847
1,215
910
426
686

6,463
2,036
1,038
1,225
914
537
710

6,576
2,076
1,046
1,232
846
515
858

6,503
2,077
1,048
1,227
869
581
700

△72
+0
+1
△5
+22
+65
△157

1,550

1,556

1,629

1,796

1,812

2,126

1,981

△145

4,097
628
3,469
24
5

3,980
633
3,347
24
-

4,261
682
3,579
22
46

4,263
697
3,565
28
-

4,650
743
3,907
22
-

4,449
760
3,689
22

4,521
763
3,758
22

+72
+2
+69
+0

-

-

-

-

-

-

-

-

-

6

＋6

993

-

-

-

-

413

414

+0

19

-

-

-

-

-

-

-

1,096
3,376
4
469
2,911
8,891
11,802011,801
1,676 yen
1,531 yen

532
2,838
3
434
2,407
2,407
0
2,407
1,462 yen
1,815 yen

560
3,087
1
571
2,517
2,517
0
2,516
1,478 yen
1,787 yen

546
3,047
2
489
2,560
2,560
0
2,559
1,476 yen
1,820 yen

580
3,349
1
568
2,782
2,782
0
2,781
1,491 yen
1,834 yen

598
3,527
543
2,983

595
3,606
1
534
3,073

△3
+79
+1
△8
+90

2,983
0
2,983
1,552 yen
1,732 yen

3,073
0
3,073
1,586 yen
1,780 yen

＋90
+90
34 yen+48 yen

9,135

9,095

8,967

8,886

8,802

8,803

8,828

+24

15FP (ended Jul.
2023) actualComparison with
forecast（※1) announced in the 14th FP financial briefing report (2023/3/16). （※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.

48

Balance Sheets

14th fiscal period
15th fiscal period(As of January(As of July 31, 2023)
31, 2023)

AssetsCurrent assets(Unit: thousand yen)

Cash and deposits

3,488,637

3,262,429

Cash and deposits in trust

8,549,954

8,525,306

Operating accounts receivable

147,713

139,180

Prepaid expenses

211,249

197,986

Consumption taxes receivable

181,189-

7,000

14,462

12,585,743

12,139,365

Other
Total current assets
Non-current assets
Property, plant and equipment
Tools, furniture and fixtures
Accumulated depreciation

114

114

(114)

(114)

0

0

56,299,699

56,821,886

Accumulated depreciation(6,169,727)(6,898,692)

Buildings in trust, net

50,129,971

49,923,193

25,34825,744(6,646)(7,577)

Tools, furniture and fixtures, net
Buildings in trust

Structures in trust
Accumulated depreciation
Structures in trust, net

18,702

18,166

Machinery and equipment in trust

163,565

251,570

Accumulated depreciation(35,247)(44,740)

Machinery and equipment in trust, net

128,318

206,829

Tools, furniture and fixtures in trust

125,782

139,432

Accumulated depreciation(39,013)(48,732)

Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment

86,76890,699140,397,333

139,857,495

1,282

33,095

190,762,377

190,129,480

Intangible assets

Liabilities
Current liabilities

906,069

995,681

15,630,000

14,340,000

Accounts payable - other539,516

534,593

Accrued expenses

77,45375,324

Operating accounts payable
Current portion of long-term borrowings

Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities

605

605

47,405

252,695

1,019,524

1,236,897

34,89935,505

18,255,474

17,471,301

Non-current liabilities
Investment corporation bonds

1,000,000

1,000,000

Long-term borrowings

80,210,000

81,500,000

Leasehold and guarantee deposits received
Leasehold and guarantee deposits received in trust

5,880

4,179

5,840,152

5,965,643-

93,57887,056,032

88,563,401

105,311,507

106,034,702

66,123,367

66,123,367

25,132,218

25,132,218

Reserve for temporary difference adjustment

8,624,499

8,535,586

Total voluntary reserve

8,624,499

8,535,586

Other
Total non-current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus

Unitholders’ capital surplus
Voluntary reserve

Leasehold rights in trust

4,082,300

4,082,300

Total intangible assets

4,082,300

4,082,300

Investments and other assets-

1,588,015

Investment securities

400,000

740,000

Long-term prepaid expenses

330,923331,220

Investments in other securities of subsidiaries and associates

15th fiscal period(As of July 31,
2023)

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

Unappropriated retained earnings (undisposed loss)

3,043,461

3,340,372

Total surplus

36,800,179

37,008,177

Total unitholders’ equity

102,923,546

103,131,545
92,917

Valuation and translation adjustments

Leasehold and guarantee deposits

10,35910,359Deferred gains or losses on hedges

531,551

Other

533,969

191,122

Total valuation and translation adjustments

531,551

92,9171,275,251

2,860,717

103,455,098

103,224,463

196,119,929

197,072,498

208,766,606

209,259,165

Investment corporation bond issuance costs

11,563

10,543

Investment unit issuance costs

49,37036,758

Total deferred assets

60,93347,301

208,766,606

209,259,165

Total investments and other assets
Total non-current assets

Total net assets
Total liabilities and net assets

Deferred assets

Total assets

49

Statement of Income(Unit: thousand yen)
14th fiscal period
From: August 1, 2022
To: January 31, 2023

15th fiscal period
From: February 1, 2023
To: July 31, 2023

Operating revenue
Rental revenue
Other lease business revenue
Gain on sale of real estate

Other revenue
Total operating revenue

5,995,567

6,048,231

467,828454,964-

414,166

22,85729,564

6,486,253

6,946,926

Operating expenses
2,556,151

2,744,572

Asset management fee

424,410

418,486

Asset custody and administrative service fees

40,52842,395

Directors’ compensations

2,400

2,400

Other operating expenses

113,204

132,242

Total operating expenses

3,136,696

3,340,096

3,349,557

3,606,830

Expenses related to rent business

Operating income
Non-operating income

56

53

1,476

1,046

Subsidy income-

504

Interest on refund

1

315

1,534

1,918

372,916

377,649

Interest income
Reversal of unpaid distribution

Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds
Borrowing related expenses

3,500

3,500

178,507

140,125

Amortization of investment corporation bond issuance costs

1,020

1,020

Amortization of investment unit issuance costs

12,611

12,611

568,555

534,906

Ordinary income

2,782,535

3,073,841

Income before income taxes

Total non-operating expenses

2,782,535

3,073,841

Income taxes - current

605

605

Total income taxes

605

605

2,781,930

3,073,236

Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

261,530

267,135

3,043,461

3,340,372

50

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

Acquisition
Investment
Appraisal
Price
ratio
value (mill)(mill)(%)

Appraisal
NOI yield(%)(＊)

Property nameLocation

Acquisition
Investment
Appraisal
Price
ratio
value (mill)(mill)(%)

Appraisal
NOI yield(%)(＊)

Minato Ward, Tokyo

2,973

3,040

1.5

4.7

Urban Park Azabujuban

Minato Ward, Tokyo

2,045

2,950

1.1

4.4

Honmachibashi Tower

Osaka City, Osaka

6,065

7,080

3.1

5.1

Urban Park Daikanyama

Shibuya Ward, Tokyo

6,315

10,100

3.3

4.8

Nishi-Shinjuku Matsuya Building

Shibuya Ward, Tokyo

1,763

2,690

0.9

6.9

Urban Park Namba

1,490

1,540

0.8

5.0

Urban Center Shibuya East

Shibuya Ward, Tokyo

2,042

3,290

1.1

5.6

Urban Park Gokokuji

1,460

1,570

0.8

4.2

Yokohama City,
Kanagawa
Fukuoka City,
Fukuoka

6,320

8,400

3.3

4.9

Urban Park Kashiwa

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

1,186

1,200

0.6

4.8

2,286

3,260

1.2

6.7

1,550

1,730

0.8

5.6

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

4.4

Shibuya Ward, Tokyo

2,580

2,790

1.3

4.0

1,810

2,180

0.9

4.8

Urban Park Gyotoku

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

1,430

1,610

0.7

4.7

Shiroi Logiman

Shiroi City, Chiba

2,470

2,520

1.3

5.7

11,700

5.8

3.6

Osaka City, Osaka

2,150

2,470

1.1

5.3

Shinjuku Ward, Tokyo

11,200Urban Park Sekime

Chiyoda Ward, Tokyo

5,440

2.8

3.7

Osaka City, Osaka

Urban Center Kanda Suda cho

5,350

Urban Park Imazato

993

1,110

0.5

5.5

Urban Center Kanda

Chiyoda Ward, Tokyo

4,590

4,570

2.4

3.8

Urban Park Yoyogi

1,740

1,990

0.9

3.6

3,990

3,506

4,090

1.8

5.4

Takadanobaba AccessShinjyuku Ward,Tokyo

Minato Ward, Tokyo

2,780

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

3,160

3,620

1.6

5.3

1,115

1,310

0.6

4.6

2,019

2,100

1.0

4.6

1,060

1,250

0.5

4.9

1,113

1,190

0.6

4.8

37,77945,710

19.5

4.9

6,942

7,690

3.6

4.8

3,560

4,330

1.8

5.7

7,875

8,950

4.1

5.3

Urban Center Yokohama West
Hakata-eki East Place

OfficeAzabu Amerex Building

Kobe City, Hyogo
Shibuya Ward, Tokyo

7,440
1,020

7,320
1,230

3.8
0.5

5.4
4.0

2,400

3,930
2,890
2,400

2.1

Urban Park Koenji
Urban Park Ichigao

1.4
1.2

3.9

Undab Center Shin-Yokohama

2,300

2,570

1.2

5.0

The Portal Akihabara

Chiyoda Ward, Tokyo

1,510

1,490

0.8

3.8

2,010

0.9

Urban Park Ryogoku

3.6

Yokohama City,
Kanagawa

1,804

Urban Park Mitsuike Koen

3.7

Chiyoda Ward, Tokyo

Urban Center Tachikawa

Urban Park Ryokuchi-koen

Urban Park Tokiwadai Koen

Hiei-Kudan Building

Tachikawa City,Tokyo
Fukuoka City,
FukuokaFujisawa City,
Kanagawa

Residence

Minami-Azabu Shibuya Building

Urban Park Mizonokuchi
Urban Park Miyamaedaira

Urban Park Tsurumi

5.2

Residence Subtotal

2,870

3,250

1.5

4.3

2,054

2,200

1.1

5.6

Yokohama Logistics

74,787

83,05038.5

4.5

Funabashi Logistics

Saitama City, Saitama
Yokohama City,
Kanagawa
Funabashi City, Chiba

Kishiwada City,
Osaka
Chikushino City,
Fukuoka

5,400

5,200

2.8

7.0

Baraki Logistics

Ichikawa City, Chiba

4,700

5,230

2.4

4.1

6,550

6,310

3.4

5.8

Tokoyozawa Logistics

Tokorozawa City,
Saitama

1,300

1,550

0.7

5.8

Seiyu Minakuchi

Koka City, Shiga

3,320

Funabashi Nishiura Logistics Ⅱ

Funabashi City, Chiba

821

891

0.4

7.0

BAGUS Ikebukuro West

Toshima Ward,
Tokyo

2,984

Matsubushi Logistics

Kita-Katsushika-gun,
Saitama

2,755

3,310

1.4

5.7

Osaka City, Osaka

9,500

Funabashi Hi-Tech Park Ⅰ

Funabashi City, Chiba

1,710

2,070

0.9

7.9

29,66334,021

15.3

5.3

Urban Center Hakata
Urban Center Fujisawa
Office Subtotal

Suroy Mall Chikushino

Retailabeno nini (Retail)
Retail Subtotal

27,7543,330
3,500
10,50028,840

1.7
1.5
4.9
14.3

7.4
4.1
4.2
5.5

Logistics

La Park Kishiwada

Iwatsuki Logistics

Logistics Subtotal

51※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.

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

Acquisition
Investment
Appraisal
Price
ratio
value (mill)(mill)(%)

Appraisal
NOI yield(%)(＊)

Period-end appraisal value：

214,731 million yen

Total book value：

194,178 million yen

Period-end unrealized gains (losses)：

20,552million yen

Net assets per unit：

53,715 yen

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

1,460

0.9

4.3

3,827

3,440

2.0

4.1

3,248

3,200

1.7

4.5

1,970

1,930

1.0

4.5

Unrealized gains per unit：

10,694 yen

GLANSIT AKIHABARA

Chiyoda Ward, Tokyo

2,500

2,440

1.3

3.9

REMBRANDT STYLE Tokyo Nishikasai
GrandeNAV per unit (*1)：

62,824 yen

Edogawa Ward,
Tokyo

3,180

3,140

1.6

4.0

：

1,450

1.0

3.6

0.92

Osaka City, Osaka

2,000

P/NAV per (*2)

KOKO HOTEL Osaka Namba
abeno nini (Hotel)

Osaka City, Osaka

REMBRANDT STYLE Tokyo Nishikasai
Best Western Yokohama

Hotel

The BREAKFAST HOTEL Fukuoka Tenjin

3,600

3,770

1.9

4.9

Hotel Subtotal

24,144

23,110

12.4

4.4

Total

194.127

214,731

100.0

4.8

(*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 July 31, 2023:
57,500 yen)

< Mezzanine loan debt investment / Preferred equity security>

No.

Name of the security（asset overview）

Type

Period-end
book value

Underlying asset, etc.
Interest rate (※2)
Asset name

MEZ-07

Star Asia Mezzanine Loan Debt Investment
Series 7

Corporate bond400

MEZ-08Star Asia Mezzanine Loan Debt Investment Series
8B

Trust beneficiaryinterest

340 Centurion Hotel Grand Akasaka

TK-03

GSA JP Project 1 Tokutei Mokuteki Kaisha
Preferred Equity Securities

Preferred equity
security

合 計

Quintessa Hotel Tokyo Haneda
Comic & Books

1,588 HAKUSAN HOUSE

Location
Ota Ward, Tokyo

Base rate +5.0%

Minato Ward,Tokyo

Base rate +7.3%

Bunkyo Ward,
Tokyo（Lending Fee：
4.0%）

2,328

※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

52

Portfolio List (Acquired on or after September 1, 2023)< Property>
Property nameResidence

Location

AcquisitionPrice(mill)

Appraisal
Appraisalvalue at
NOI yield
end of(%)(＊)
13 FP(mill)

Urban Park Mitaka

Minato Ward, Tokyo

743

1,010

5.0

Urban Park Kamata MinamiⅠ

Ota Ward, Tokyo

641

864

5.0

Urban Park Kamata MinamiⅡ

Ota Ward, Tokyo

1,375

1,720

4.7

Urban Park Umejima

Adachi Ward, Tokyo

1,032

1,140

4.1

3,791

4,734

4.6

17,80018,600

4.0

6,700

7,040

4.9

5,000

5,370

4.9

4,100

4,280

5.2

3,800

4,260

6.1

4,200

4,250

4.6
6.7

Subtotal
KOKO HOTEL Ginza 1-Chome
KOKO HOTEL Sapporo Ekimae
KOKO HOTEL Fukuoka Tenjin
KOKO HOTEL Hiroshima Ekimae

Hotel
KOKO HOTEL Kagoshima Tenmonkan
Fino Hotel Sapporo OdoriBest Western Plus Fukuoka Tenjin-minami

Chuo Ward, Tokyo
Sapporo City,
Hokkaido
Fukuoka City,
Fukuoka
Hiroshima City,
Hiroshima
Kagoshima City,
Kagoshima
Sapporo City,
Hokkaido
Fukuoka City,
Fukuoka

Subtotal
Total

3,800

4,390

45,40048,1904.8

49,191

52,9244.8< Mezzanine loan debt investment >No.

MEZ-08Name of the security（asset overview）

Type

Star Asia Mezzanine Loan Debt Investment Series
8A

Trust beneficiaryinterest

Total

Acquisition
Price

Underlying asset, etc.
Interest rate (※2)
Asset name

430 Centurion Hotel Grand Akasaka

Location
Minato Ward,Tokyo

Base rate +5.3%

430※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

53

Balance of Payments of Individual Properties (1)（Unit : Thousand yen）
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
Urban Center Shibuya
East

OFC-08
Urban Center YokohamaWest

OFC-09Hakata-eki East Place

2,973 million yen
3,040 million yen
SRC B1/7F
Minato Ward, Tokyo

6,065 million yen
7,080 million yen
S/SRC B1/21F
Osaka City, Osaka

1,763 million yen
2,690 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
8,400 million yen
S・SRC B2/12F
Yokohama City, Kanagawa

2,286 million yen
3,260 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

FP14

FP15

FP14

FP15

FP14
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

OFC-03

FP15

FP14

FP15

FP14

FP15

FP14

FP15

102,768

99,368250,354249,203

119,608

120,379

70,71674,599235,651

231,766

115,873

118,913

90,11790,623214,898

215,411

104,825

108,488

66,97071,160211,725

210,792

104,943

107,143

12,651

8,745

35,456

33,792

14,783

11,890

3,745

3,438

23,926

20,974

10,929

11,77031,12828,35673,322

77,19938,19934,504

13,30014,352

70,95256,147

29,61625,078

5,949

6,081

14,425

15,194

7,093

6,977

4,888

4,936

14,802

15,618

8,328

8,352

Utilities expenses

7,971

5,793

32,481

31,83812,785

8,790

3,118

2,275

29,20917,438

8,937

6,302

Taxes and dues

4,496

4,483

19,80720,019

3,445

3,401

4,418

4,685

15,952

16,365

7,321

7,715

Repair expenses

763

672

4,192

7,680

264

1,967

382

1,795

9,640

5,040

2,964

1,766

Trust fee

391

388

400

400

400

400

350

350

400

400

400

400

Insurance premium

150

147

465

456

167

164

58

57

487

477

219

213

Other expenses

11,404

10,789

1,550

1,610

14,044

12,803

84

251

460

807

1,444

328

NOI

71,64071,012

177,032

172,004

81,40885,87457,41560,246

164,699

175,619

86,257

93,834

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

13,261

13,94145,45445,54910,613

10,813

3,942

3,986

29,87931,01412,087

12,91958,37957,070131,577

126,455

70,79575,06153,47356,260134,819

144,605

74,17080,91539,923

1,728

460

6,077

4,057

7,263

1,880

408

47,448

7,464

37,840

4,764

NCF
Period-end book value(million yen)

31,717

69,284

176,571

165,927

77,351

78,611

55,53559,838117,250

168,154

48,41689,069

2,980

2,968

5,596

5,556

1,803

1,799

2,089

2,085

6,294

6,270

2,425

2,417

54

Balance of Payments of Individual Properties (2)（Unit : Thousand yen）
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

7,320 million yen

1,230 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）
2,384.03㎡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

FP14
Total operating revenue
from real estate leasing
Lease businessrevenue
Other lease businessrevenue
Total operating expenses
from real estate leasing

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

39,904

45,126

316,441

321,893

207,083

198,113145,353

140,958

39,904

45,126

278,559

283,414

187,065

184,896

135,305

135,273--

37,88238,47920,017

13,217

10,048

5,684

12,932

17,529131,401

142,937

68,75384,53533,91135,585

Management fee

678

801

25,114

23,132

18,93018,394

12,107

11,753

Utilities expenses

186

91

43,902

47,211

14,138

9,476

7,998

6,108

Taxes and dues

4,371

4,510

29,02829,85721,456

22,77910,91811,457

Repair expenses

379-

10,066

15,528

10,325

19,732

1,912

5,050

Trust fee

400

400

400

400

350

650

350

650

Insurance premium

175

172

954

934

288

283

211

208

6,742

11,553

21,93525,872

3,264

13,218

412

358

NOI

26,971

27,59652,55452,206

185,040

178,956

20,642

20,587

138,329

113,578

111,441

105,372

Depreciation

2,941

3,061

4,221

4,290

41,67944,791

1,676

1,676

16,20419,000

8,903

9,190

Operating income (loss)
from real estate leasing

24,03024,53548,332

47,915

143,360

134,164

18,965

18,911

122,125

94,577

102,538

96,182

Capital expenditures

5,306

2,709

-

6,542

45,935

117,396--

64,429108,903

3,508

19,067

NCF

21,66424,88752,55445,663

139,104

61,55920,642

20,58773,8994,674

107,933

86,304

Period-end book value(million yen)

1,449

1,449

2,575

2,577

7,661

7,734

1,033

1,032

11,325

11,415

5,339

5,348

Other expenses

（※）

（※）

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

（※）

（※）

55

Balance of Payments of Individual Properties (3)（Unit : Thousand yen）
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

4,570 million yen

3,930 million yen

2,890 million yen

2,400 million yen

2,570 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(million yen)

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

FP14

FP15

FP14

FP15

119,634

115,699

111,912

107,193

73,793

72,91860,731

69,31985,24887,47133,893

33,464110,043

110,501

100,364

98,124

68,952

68,88760,731

68,534

74,22679,70631,89732,163

9,591

5,198

11,547

9,068

4,840

4,031

-

785

11,021

7,765

1,996

1,301

31,74827,29038,276

38,731

20,726

26,644

26,592

24,65632,686

31,225

9,040

9,277

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

9,876
6,120
7,917
1,498
700
200
977
88,40813,334

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

13,085
8,691
9,547
1,696
600
219
4,890
68,461
11,044

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

7,527
3,051
8,257
6,465
775
103
463
46,274
4,028

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

3,564
28
7,206
800
183
12,873
44,663
4,027

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

9,943
7,047
8,094
4,829
650
190
471
56,245
14,782

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

2,702
1,177
1,642
205
600
39
2,910
24,186
3,897

75,16275,07462,93357,41649,21842,24630,20540,636

38,69041,463

21,24820,28915,63372,252

3,310
85,097

8,199
65,436

12,95755,504

5,609
47,457879
45,394

3,467
30,672

44,66319,99832,56353,3202,925

11,553
13,2982,553
21,633

4,738

4,728

4,004

4,005

2,786

2,783

2,390

2,386

2,428

2,467

1,504

1,502

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

56

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

OFC-22
Urban Center Tachikawa

OFC-23
Urban Center Hakata（Unit : Thousand yen）
OFC-24
Urban Center Fujisawa

Acquisition price

1,804 million yen

2,870 million yen

2,054 million yen

Appraisal value

2,010 million yen

3,250 million yen

2,200 million 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

FP14
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

FP15

FP14

FP15

FP14

FP15

45,852

51,351

77,04377,04377,094

81,57041,232

47,234

77,04377,043

66,79373,506

4,619

4,116

-

-

10,301

8,063

19,54332,086

12,363

12,413

14,83339,451

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

5,002
3,511
4,557
13,636
400
139
4,837
19,265
6,454

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

5,188
6,424
99
400
119
181
64,63015,281

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

4,918
7,609
4,185
21,761400
144
431
42,1186,257

56,31835,861

1,443
60,817

54,100△11,981

2,147

2,195

NOI
Depreciation
Operating income (loss)
20,75012,81049,39849,348from real estate leasing
Capital expenditures
27,86558,304NCF
64,67964,630△1,557△39,039
Period-end book value
1,852
1,904
2,854
2,839
(million yen)(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

57

Balance of Payments of Individual Properties (5)（Unit : Thousand yen）
RTL-06abeno nini (Retail)

Asset Type
Property name

RTL-01
LaPark Kishiwada

RTL-02
Suroy Mall Chikushino

RTL-03
Seiyu Minakuchi

RTL-05
BAGUS Ikebukuro West

Acquisition price5,400 million yen

6,550 million yen

3,320 million yen

2,984 million yen

9,500 million yen

Appraisal value

5,200 million yen

6,310 million yen

3,330 million yen

3,500 million yen

10,500 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

FP14

FP14

FP15

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

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

FP14

FP15

FP14

FP15

533,043

528,144

267,243

258,010201,113

221,344

417,110414,658

263,274

254,700

201,113

221,344

115,932

113,485

3,969

3,309

-

-

331,572

347,730

68,23180,94618,03428,028
1,200
8,254
350
145
18,078
193,315
16,639111,190
150,175
44,199
9,417
1,850
1,184
13,553
201,470
27,587

118,104
143,934
44,04420,2022,150
1,164
18,128
180,41329,612

22,715
7,219
19,796
1,372
350
622
16,154
199,01123,314

24,771
5,142
20,787
5,627
650
611
23,355177,063
23,328NOI
Depreciation
Operating income (loss)
173,883
150,801
175,697
153,734
from real estate leasing
Capital expenditures
84,18155,355
2,521
NCF
117,289
125,058
199,011
174,541
Period-end book value
5,474
5,499
6,427
6,406
(million yen)(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

FP14

FP15

（※）

FP15

（※）

（※）

（※）

128,41326,441

121,329
26,59260,9432,304

60,654
2,316

1,090
3
81
318
131
16,410183,079
16,639101,972

94,736

58,63958,337

166,439

176,676

128,4139,435
111,894

60,943

1,106
59,547183,079

193,315

3,221

3,203

3,001

3,000

9,589

9,572

58

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（Unit : Thousand yen）
RSC-08
Urban Park Ryokuchi-koen

Acquisition priceAppraisal value

6,315 million yen
10,100 million yen

1,490 million yen
1,540 million yen

1,460 million yen
1,570 million yen

1,186 million yen
1,200 million yen

1,550 million yen
1,730 million yen

Location

2,045 million yen
2,950 million yen
SRC with slate roofing
B1/12F
Minato Ward, Tokyo

Lot area

417.67㎡

Structure/Floors

Total floor areas
Construction completion

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

FP14

FP14

FP14
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee①RC B1/3F ②RC B1/9F

FP15

FP14

FP15

FP14

FP15

FP15

FP15

FP14

FP15

56,193

57,632

197,239

201,243

48,39445,67250,59347,591

38,58239,29160,716

60,731

54,26856,102

186,671

194,689

46,97944,916

46,63745,14537,72037,772

57,591

57,359

1,925

1,529

10,567

6,553

1,415

756

3,956

2,445

861

1,518

3,124

3,372

14,085

10,912

41,614

31,984

13,047

14,46017,69723,564

8,949

9,861

17,023

15,271

2,287

2,211

9,486

10,291

2,555

3,328

4,213

3,761

2,575

2,473

3,070

2,558

Utilities expenses

786

705

4,924

2,971

427

431

2,711

2,771

634

627

2,865

2,627

Taxes and dues

2,937

2,995

11,761

12,211

2,841

2,892

1,914

1,932

2,955

2,959

3,584

3,594

Repair expenses

3,811

2,919

5,438

2,683

4,097

2,780

5,179

9,421

1,403

2,197

5,214

3,960

Trust fee
Insurance premium

350

350

350

350

350

350

400

400

350

350

350

350

74

72

250

237

85

83

67

66

111

108

165

159

Other expenses

3,839

1,658

9,402

3,238

2,689

4,595

3,210

5,211

918

1,144

1,772

2,020

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

42,10846,719155,624

169,259

35,347

31,21132,89624,026

29,63329,43043,692

45,460

5,200

5,214

12,812

12,981

7,874

8,021

6,041

5,909

7,622

7,662

8,392

8,758

36,90841,505

142,812156,277

27,472

23,18926,854

18,11722,011

21,76735,30036,701

1,362

3,315

4,330

4,041

1,881

1,353

-

801

750

135

4,498

8,520

NCF
Period-end book value(million yen)

40,74643,404

151,294

165,21733,46629,85832,89623,22528,88329,29439,19436,940

2,064

2,062

6,339

6,330

1,475

1,469

1,494

1,489

1,216

1,209

1,580

1,580

59

Balance of Payments of Individual Properties (7)Asset Type

（Unit : Thousand yen）
RSC-14

RSC-09

RSC-10

RSC-11

RSC-12

RSC-13

Property nameUrban Park Koenji

Urban Park Ichigao

Urban Park Gyotoku

Shiroi Logiman

Urban Park Sekime

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

2,180 million yen

1,610 million yen

2,520 million yen

2,470 million yen

1,110 million yen

Structure/Floors

Urban Park Imazato

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

FP14
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

FP15

FP14

FP15

FP14

FP15

FP14

FP15

8,190.11㎡

4,862.83㎡

August 18, 1989

December 20, 1991

FP14

FP14

FP15

FP15

36,134

36,10659,08260,07437,00537,816

143,014141,678

87,176

88,07739,32739,31633,95333,68656,751

57,72835,431

36,063

135,266

134,474

84,98285,40539,207

38,664

2,181

2,419

2,331

2,346

1,573

1,753

7,748

7,204

2,194

2,672

120

652

9,049

12,002

14,047

12,706

8,763

9,573

62,07069,15524,197

26,52012,764

13,149
3,817

2,303

2,241

3,188

3,612

1,950

2,054

6,057

6,081

9,859

9,989

4,076

Utilities expenses

1,661

1,688

1,919

1,473

1,282

1,030

32

71

2,145

2,645

389

334

Taxes and dues

1,027

1,062

3,963

3,962

2,170

2,192

13,92013,913

5,294

5,302

3,204

3,202

Repair expenses

2,392

4,340

3,371

2,104

1,588

2,132

12,695

16,429

4,638

5,189

3,711

3,480

Trust fee
Insurance premium

400

400

400

400

400

400

750

1,050

375

775

375

775

50

50

147

144

97

95

828

807

286

281

145

142

Other expenses

1,213

2,218

1,057

1,010

1,274

1,668

27,78530,800

1,598

2,337

862

1,397

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

27,084

24,10445,03547,36828,241

28,24380,944

72,52362,97861,556

26,562

26,166

2,970

2,979

5,628

6,293

4,386

4,411

19,323

19,392

13,052

13,759

5,243

5,352

24,114

21,12439,40741,07423,85523,832

61,62153,131

49,92547,79721,31920,814-529

21,497

2,048

951

1,533

1,624

1,263

24,366

3,111

2,191

567

NCF
Period-end book value(million yen)

27,084

23,57423,53845,31927,28926,71079,31971,26038,61258,44524,371

25,599

1,184

1,182

1,926

1,922

1,503

1,500

2,379

2,361

2,205

2,194

969

965

60

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

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures
NCF
Period-end book value(million yen)

RSC-17
Urban Park
Mitsuike Koen

3,506 million yen
4,090 million yen

3,160 million yen
3,620 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㎡（Unit : Thousand yen）
RSC-20

RSC-18

RSC-19Urban Park Ryogoku

Urban Park Mizonokuchi

Urban Park Miyamaedaira

1,115 million yen
1,310 million yen

2,019 million yen
2,100 million yen

1,060 million yen
1,250 million 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

FP14
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

RSC-16
Urban Park
Tokiwadai Koen

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

41,28539,871

144,047

146,106

128,477

127,538

36,29636,73762,72363,57032,78332,97640,89539,005

137,549

138,712

122,666

120,428

35,94235,88959,37359,09332,18330,814

389

866

6,498

7,394

5,811

7,109

354

848

3,349

4,477

599

2,162

6,755

8,838

38,46353,52841,05342,394

7,155

9,503

21,50228,351

5,908

8,330

2,260
302
1,655
498
400
50
1,587
34,530
4,393

2,273
333
2,033
922
600
49
2,626
31,032
4,393

13,103
3,313
10,790
5,914
400
421
4,519
105,584
13,33013,297
1,260
10,766
20,039
400
411
7,353
92,57813,911

11,2672,309
8,813
10,462
400
338
7,460
87,424
12,528

10,9891,098
8,796
14,101
400
327
6,680
85,144
12,629

2,553
570
1,851
1,684
400
74
21
29,140
2,518

3,165
441
1,880
2,729
400
72
814
27,233
2,612

4,185
1,079
3,404
9,856
400
151
2,424
41,220
6,014

4,038
708
3,466
10,360
400
148
9,228
35,218
6,681

1,373
55
1,605
535
400
52
1,886
26,874
4,523

1,684
47
1,605
1,237
400
51
3,304
24,646
4,527

30,136

26,63992,25378,66674,89572,515

26,622

24,62135,20628,53722,35020,11934,53031,03233,15372,43025,59066,987

1,972
85,451

12,65372,491379
28,7603,925
23,30815,92825,291

17,42017,79826,874396
24,250

1,718

1,713

3,631

3,642

3,284

3,284

1,147

1,148

2,094

2,104

1,096

1,091

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

61

Balance of Payments of Individual Properties (9)（Unit : Thousand yen）
Asset Type

RSC-21

Property nameUrban Park Tsurumi

Acquisition priceAppraisal value

1,113 million yen
1,190 million yen

Structure/Floors
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(million yen)

RC 6F
Yokohama City, Kanagawa
2,172.70㎡
3,169.13㎡
February 17, 1994
FP14

FP15

（※）

（※）

28,563
2,726

25,6882,768

25,837

22,9191,501
27,061

25,688

1,149

1,146

62
(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

Balance of Payments of Individual Properties (10)Asset Type

（Unit : Thousand yen）
LGC-07
Funabashi Nishiura
Logistics Ⅱ

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
4,330 million yen

7,875 million yen
8,950 million yen

4,700 million yen
5,230 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

FP14

FP15

205,181

FP14

FP15

FP14

FP15

200,080

269,093

265,877

187,713

187,713244,264

251,102

17,467

12,367

24,828

14,77438,07435,12762,90967,205（※）（※）

6,240.96㎡

8,645.63㎡

3,964.00㎡

12,471.50㎡

5,994.75㎡

6,316.32㎡

August 14, 2015

April 30, 1999

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

FP14

FP15

FP14

FP15

FP14

FP15

（※）

（※）

（※）

（※）

（※）

（※）

6,140

7,219

12,187

11,775

Utilities expenses

17,467

12,367

23,16615,024

Taxes and dues

13,44813,54821,634

22,146

Repair expenses

315

144

3,685

17,136

Trust fee
Insurance premium

350

350

400

400

352

346

510

499

-

1,151

1,324

223

NOI

167,106

164,953

94,956

94,640206,184

198,671

97,54369,28037,56937,236

26,584

28,796

Depreciation
Operating income (loss)
from real estate leasing

46,87946,87919,832

19,84528,997

29,704

15,784

15,784

5,962

6,087

4,578

4,620

120,227

118,074

75,12474,795

177,186

168,967

81,75953,49531,60631,14822,00524,175

908

-

-

1,182

12,24730,521

-

-

6,143

1,848

677

730

166,198
94,956
164,953
93,458Period-end book value
6,374
3,656
6,327
3,637
(million yen)(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

193,937

168,150

97,54369,28031,42535,38825,90728,065

7,714

7,714

4,566

4,550

1,349

1,344

847

843

Other expenses

Capital expenditures
NCF

63

Balance of Payments of Individual Properties (11)Asset Type

（Unit : Thousand yen）
LGC-09LGC-08Property name

Matsubushi Logistics

Funabashi Hi-Tech ParkⅠ

Acquisition priceAppraisal value
Structure/Floors

2,755 million yen
3,310 million yen
RC 3F
Kita-Katsushika-gun,
Saitama
11,580.65㎡
19,833.47㎡

1,710 million yen
2,070 million yen
S 2F

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

Funabashi city, Chiba
13,420.44㎡
8,029.47㎡
May 19, 2003

FP14

FP15

FP14

FP15

（※）

（※）

（※）

（※）

Utilities expenses
Taxes and dues
Repair expenses
Trust fee
Insurance premium
Other expenses
NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

79,022

79,34355,46648,42916,457

17,194

5,737

5,737

62,564

62,14849,72942,692

10,242

78,104--

NCF
Period-end book value(million yen)

68,7801,238

55,46648,429

2,662

2,723

1,681

1,675

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

64

Balance of Payments of Individual Properties (12)Asset Type

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
1,460 million yen
S 9F

3,827 million yen
3,440 million yen
SRC 9F/B1F

3,248 million yen
3,200 million yen
SRC 9F/B1F

1,970 million yen
1,930 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

FP14

FP14

FP14

FP14

FP15

FP14

FP15

（※）

（※）

（※）

（※）

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

FP15

HTL-03REMBRANDT STYLETokyo Nishikasai

FP15

FP14

HTL-04

HTL-05The BREAKFAST HOTEL
Fukuoka Tenjin（Unit : Thousand yen）
HTL-06

HTL-01Best Western Yokohama

FP15

FP15

65,27765,212

27,79540,39484,60084,60080,40080,40065,27765,212

27,79540,39484,60084,60080,40080,400

-

-

-

-

-

-

-

-

8,009

8,310

4,594

4,118

10,19325,324

6,811

15,352

742

742

660

717

1,200

1,200

1,200

1,200

GLANSIT AKIHABARA

Utilities expenses

6

4

-

-

-

-

-

-

Taxes and dues

5,528

5,691

2,255

2,313

8,065

8,522

4,584

4,638

Repair expenses

1,198

1,345

1,033

442

343

15,022

467

8,655

Trust fee
Insurance premium

350

350

550

550

400

400

400

400

155

152

71

70

161

158

137

134

Other expenses

28

24

23

25

23

22

21

324

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

57,26756,902

23,201

36,27574,40659,27573,58865,04748,02842,27848,89548,863

10,785

10,983

12,222

12,29013,49914,383

13,10913,357

8,647

8,647

4,643

4,643

46,48145,91910,97823,98560,90644,89160,47851,69039,38033,63044,25244,220

6,869

-

1,819

1,575

14,69047,977

7,200

2,672

-

-

-

-

NCF
Period-end book value(million yen)

50,39856,902

21,381

34,70059,715

11,297

66,38862,37448,02842,27848,89548,863

2,093

2,083

1,616

1,605

3,838

3,872

3,202

3,191

1,913

1,905

2,480

2,476

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

65

Balance of Payments of Individual Properties (13)（Unit : Thousand yen）
Asset Type
Property nameAcquisition priceAppraisal value
Structure/Floors
Location
Lot area
Total floor areas
Construction completion

HTL-07REMBRANDT STYLETokyo Nishikasai Grande

HTL-08
KOKO HOTEL
Osaka Namba

3,180 million yen
3,140 million yen
S 8F

2,000 million yen
1,450 million yen
RC9F

3,600 million yen
3,770 million yen
RC24F/2B

Edogawa Ward, Tokyo

Osaka City, Osaka

Osaka City, Osaka

657.00㎡
2,755.19㎡

335.31㎡
2,061.38㎡

586.44㎡
7,764.81㎡

February 7, 2017

April 7, 2017

January 31, 2012

FP14
Total operating revenue
from real estate leasing
Lease businessrevenue
Other leasebusiness revenue
Total operating
expenses from realestate leasing
Management fee

FP15

FP14

HTL-09abeno nini (Hotel)

FP15

70,00270,002

23,63853,14270,00270,002

23,63853,142

-

-

-

-

6,871

6,978

5,259

5,452

990

990

900

900

FP14

FP15

（※）

（※）

Utilities expenses

-

-

-

-

Taxes and dues

5,220

5,305

3,213

3,347

Repair expenses

146

172

222

77

Trust fee
Insurance premium

400

400

350

350

91

89

65

64

Other expenses

22

21

508

713

63,13063,023

18,37947,69065,72858,643

10,857

10,857

8,983

8,925

6,885

6,885

52,27352,165

9,396

38,764

58,84351,758NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures

NCF
63,13063,023
18,37947,690Period-end book value
3,110
3,099
1,944
1,935
(million yen)(*) Not disclosed as consent for disclosure has not been obtained from the tenant.

--65,72858,643

3,644

3,637

66

Balance of Payments of Individual Properties (14)
OfficeRetailResidence

Logistics

Hotel

Total

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

FP14

FP15

2,377,116

2,383,090

1,227,438

1,233,536

1,333,996

1,337,505

985,459

964,998

539,385

584,065

6,463,396

6,503,195

2,148,351

2,190,554

1,107,536

1,116,740

1,278,994

1,281,422

921,299

875,448539,385

584,065

5,995,567

6,048,231

228,765

192,535

119,901

116,795

55,00256,08264,15989,550--467,828454,964

724,288771,943454,518

500,759

370,507409,890

196,416

192,559

66,759106,064

1,812,490

1,981,218

Management fee

174,635

175,417

137,456

146,536

88,63790,49232,64432,393

8,030

8,076

441,402452,917

Utilities expenses

212,993

176,505

157,395

149,077

28,041

21,672

63,93642,0566

4462,373

389,316

Taxes and dues

179,051

189,61178,46987,76386,20887,27878,762

77,63835,75450,708458,246

493,000

Repair expenses

62,987

109,612

12,24934,04082,942

110,658

11,66528,7893,411

25,715173,257

308,817

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

Trust fee

8,230

10,563

3,418

4,250

7,650

8,950

3,350

3,340

3,518

3,550

26,16630,653

Insurance premium

4,639

4,560

2,508

2,482

3,483

3,394

1,907

1,814

1,059

1,071

13,59813,322Other expenses

81,750105,672

63,02076,60873,54487,444

4,150

6,525

14,97816,938237,444

293,190

1,652,828

1,611,146

772,919732,776

963,489

927,614789,042

772,439472,626

478,000

4,650,905

4,521,977

266,332

279,344

96,286

98,489144,583

148,260

146,823

146,285

89,63590,973

743,661

763,353

1,386,495

1,331,802

676,632

634,286

818,906

779,353642,218

626,153

382,990387,026

3,907,244

3,758,623

NOI
Depreciation
Operating income (loss)
from real estate leasing
Capital expenditures
NCF
Period-end book value(million yen)

344,563467,754

84,181

68,418116,389

87,20530,218112,387

30,57952,225605,932

787,991

1,308,264

1,143,392

688,737

664,357

847,099

840,409758,824

660,052

442,046

425,774

4,044,973

3,733,985

75,28275,47027,713

27,68338,46038,39929,541

28,81823,84423,805

194,843

194,178

FP14 (2023/1)

Income Ratio

FP15 (2023/7)

HTL,
8.3%
OFC,
LGC,
36.8%
15.2%

HTL,
9.0%
OFC,
LGC,
36.6%
14.8%

RSC,
20.6%

RSC,
20.6%

RTL,
19.0%

RTL,
19.0%

（※） The ratio of total real estate rental revenues of each asset to the total amount of total real estate rental revenues.

FP16 (Forecast)
HTL,
OFC,
19.8%
33.1%
LGC,
12.7%
RSC, RTL,
17.5% 16.9%

FP17 （Forecast)

HTL,
22.8%

OFC,
31.7%

LGC,
12.3% RSC, RTL,
17.2% 15.9%

67

Note
P.3

(Note 1）

“Asset size” is the sum of (anticipated) acquisition prices for all of SAR’s assets. The value of the properties carried over through the merger with Sakura Sogo REIT Investment
Corporation (“Sakura Sogo REIT”) effective on August 1, 2020 is calculated based on receipt price. The same shall apply hereinafter. Assets include the preferred equity
securities (“Preferred Equity Securities”) issued by a Tokutei Mokuteki Kaisya (TMK) which holds beneficiary interests in trust for which “HAKUSAN HOUSE” is the main entrusted
asset. Assets are calculated excluding investments in mezzanine loan debt as of the date of this document. The same shall apply hereinafter

P.3(Note 2)

“Market capitalization" is calculated by multiplying the closing price as of August 31, 2023 by the number of investment units issued and outstanding as of the same date.

P.3(Note 3)

“Average building age” is the weighted average calculated by dividing the building age of each property.
* “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 January 31, 2023.

P.6(Note 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 thesecond decimal place.

P.7(Note 1）

“Number of properties” is the number of real estate, etc. (Note 2), excluding Preferred Equity Securities and the mezzanine loan debt. The same shall apply hereinafter.

(Note 2)

“Real estate, etc.” refers to real estate and real estate beneficiary interests in trust. The same shall apply hereinafter.

(Note 3)

“Average building age” for “End of January 2023” is the weighted average calculated by dividing the building age of each property held as of January 31, 2023 (end of 14th FP)
by its acquisition price; for “Assets” (“Funabashi Hi-Tech Park Factory II”, which has been transferred as of the date of this document, and “Urban Park Gokokuji” and “Urban Park
Koenji”, the weighted average calculated by dividing the building age of each property by its acquisition price; for “Assets (to be Acquired),” the weighted average calculated by
dividing the building age of Assets to be Acquired (excluding Preferred Equity Securities) by the anticipated acquisition price; for “After PO” the weighted average calculated by
dividing the average age of the assets owned by SAR as of January 31, 2023 (end of 14th FP) and Assets to be Acquired minus Assets (Transferred) (“Assets (to be Acquired)following the after PO”) excluding the Preferred Equity Securities by their (anticipated) acquisition price. The same shall apply hereinafter. “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 May 31, 2023. As for “Urban Park Daikanyama,” which consists of two buildings, “building age” refers to the period commencing on thedate of completion of the older building and ends on May 31, 2023. The building age of any Asset to be Acquired that is not completed as of May 31, 2023 is counted as zero.
The same shall apply hereinafter.

(Note4)“Average appraisal NOI yield” is the ratio of the sum of net operating income (NOI) calculated based on the direct capitalization method in real estate appraisal reports to the totalacquisition price of the properties held as of January 31, 2023 for “End of January 2023,” the ratio of the sum of net operating income (NOI) calculated based on the direct
capitalization method in real estate appraisal reports for each of the Assets (Transferred) to the total acquisition price of Assets (Transferred) for “Assets (Transferred),” the ratioof the sum of net operating income (NOI) calculated based on the direct capitalization method in real estate appraisal reports for the Assets to be Acquired to the total anticipatedacquisition price of Assets to be Acquired, excluding Preferred Equity Securities, and the ratio of the sum of net operating incomes (NOI) calculated based on the direct
capitalization method in real estate appraisal reports for Assets (to be Acquired) following the Initiative to the total (anticipated) acquisition price of the Assets (to be Acquired)following the Initiative for “Following the Initiative,” excluding Preferred Equity Securities. These values are rounded to the first decimal place. The same shall apply hereinafter.

(Note 5)

“Average post-depreciation appraisal NOI yield” is, for “End of January 2023," the ratio of the sum of net operating income (NOI) calculated based on the direct capitalization
method in real estate appraisal reports less twice the actual depreciation cost for the fiscal period ended January 2023 (14th FP) to the total acquisition price of the properties
held as of January 31, 2023; for “Assets (Transferred),” the ratio of the sum of net operating income (NOI) calculated based on the direct capitalization method in real estateappraisal reports less twice the actual depreciation cost for the fiscal period ended January 2023 (14th FP), to the total acquisition price of the Assets (Transferred); for “Assets(to be Acquired),” the ratio of the sum of net operating income (NOI) calculated based on the direct capitalization method in real estate appraisal reports less depreciation cost
anticipated by the Asset Manager to the total anticipated acquisition price of the Assets to be Acquired, excluding Preferred Equity Securities, and for “After PO,” the ratio of thesum of net operating income (NOI) calculated based on the direct capitalization method in real estate appraisal reports less twice the actual depreciation cost for the fiscal period
ended January 2023 (14th FP) or the depreciation cost anticipated by the Asset Manager to the total (anticipated) acquisition price of the Assets (to be Acquired) following theInitiative, excluding Preferred Equity Securities. These values are rounded to the first decimal place.

68

Note
P.19

(Note 1)On March 16, 2023, we signed a building lease (option) agreement presupposing extension of the building with the current tenant on the premise of the extension, and on April
28, 2023, we decided to sign a construction contract for the building extension. In addition, we signed a second building lease amendment (option) agreement on July 19, 2023
and a construction contract for the additional building extension in response to a request for an additional extension on July 25,2023.

(Note 2)

“Artist rendering of completed extension work (1 out of 2)” of “Funabashi High Technology Park Factory I” describes an exterior image of one of the two building extensions
assuming the building to be completed. The exterior image is a plan under construction as of the date of this document, and may differ from the completed building.

(Note 3)

The figure shown as pre-extension total leasable space is based on the pre-extension building lease contract; the figure shown as post-extension total leasable space is basedon the second building lease amendment (option) agreement dated July 19, 2023.

(Note 4)

“Floor-area ratio (FAR)” is calculated by dividing the total floor area (floor area subject to FAR) by the size of the land. The pre-extension total floor area is the leasable floor area
based on the pre-extension building lease contract; the post-extension total floor area which is the base of FAR is the area of the entire building given in the application for
confirmation of the building extension.

(Note 5)

“Acquisition price” is calculated by setting the acquisition price of pre-extension pertaining to Funabashi High Technology Park Factory I to 100 and adding the anticipatedinvestment amount (includes a certain reserve fund) pertaining to the extension to the acquisition price.

(Note 6)The monthly rent index is calculated by setting the monthly rent as of the date of this document to 100 and the rent stated in the second building lease amendment (option)agreement.

P.21(Note 1)

“GOP” stands for “gross operating profit” and refers to the total operating income of hotel operations less operating expenses directly related to sales. The same shall apply
hereinafter.

P.27(Note 1)

As of the date of this document, SAR has no plan to acquire properties owned by Star Asia Group except for 7 hotels (Assets to be Acquired) and there is no guarantee that SAR
will be able to acquire such properties in the future.

(Note 2)

The appraisal value of properties managed by Star Asia Group are calculated based on the values in their latest appraisal reports, at each point in time. (Of the various assets
owned by Star Asia Group as of the end of June 2019, this applies to those assets that qualify as real estate, etc., and were not then owned by SAR or among those properties
for which SAR had obtained preferential negotiating rights or among the assets owned by Polaris; of the various assets owned by Star Asia Group as of the end of May 2023,
those assets that qualify as real estate, etc., and were not then owned by SAR, or among those properties for which SAR had obtained preferential negotiating rights, or among
the assets owned by Polaris as of such date. The various assets owned by Star Asia Group as of the end of May 2023 including 7 hotels (Assets to be Acquired) and 12 hotels
for which SAR has obtained preferential negotiating rights (“12 hotels with preferential negotiating rights”). The same shall apply hereinafter.)(Note 3)

“Ratio operated by Polaris” is the ratio by appraisal value of hotel properties managed and operated by Polaris to the total appraisal value of 12 hotels with preferential
negotiating rights.

(Note 1)

“Structure / floors” refers to the structure and floors of the principal building as registered in the registry of real estate, and may be different from the current status. Where thebuilding has not been completed as of the date of this document, it is based on the certificate of confirmation and is subject to change in the future. The same shall apply
hereinafter.

(Note 2)

“Total floor area” refers to, unless otherwise noted, the total floor area registered in the registry of real estate, and may be different from the actual status. Where the building has
not been completed as of the date of this document, it is based on the certificate of confirmation and is subject to change in the future. The same shall apply hereinafter.

(Note 3)“Completion date” refers to the date of completion of construction for the principal building as registered in the registry of real estates. Where the building has not been completed
as of the date of this document, it is based on the certificate of confirmation and is subject to change in the future. The same shall apply hereinafter.

(Note 4)

“Ginza address” refers to all hotel properties owned by J-REITs with an address in Ginza, Chuo-ku, Tokyo as an indication of the residential addresses. (All hotel properties in JREITs are based on disclosures by each J-REIT as of the end of June 2023.)

P.32

69

Note
P.39

（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 theorganization 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.40（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 3）

“Energy Consumptions intensity” refers to per-unit Energy Consumptions emissions amount resulting from a specific activity. In this document, Energy Consumptions 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 documentby the total floor area of assets.

（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 andconsideration 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 and Tourism. 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 realestate assessment system was developed 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 shallapply 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 and improvement of working environment by concluding contracts, memorandums, etc., and implement such rules.

P.41

70

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.

■Star Asia Group YouTube Cannel
https://www.youtube.com/@user-wf8jo1ct6p■ 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
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