(REIT) Financial Report for Fiscal Period Ended January 31, 2021
March 16, 2021
Stock Exchange Listing: Tokyo Stock Exchange
URL: http://starasia-reit.com

REIT Securities Issuer:
Securities Code:
Representative:

Star Asia Investment Corporation (SAR)
3468
Atsushi Kato, Executive Director

Asset Management Company:
Representative:
Contact:

Star Asia Investment Management Co., Ltd.
Atsushi Kato, President and CEO
Akiko Kanno, Director and CFO
TEL: 03-5425-1340

Scheduled date of commencement of cash distribution payment:
Scheduled date of submission of securities report:

April 28, 2021
April 16, 2021

Preparation of supplementary financial results briefing materials:
Holding of financial results briefing session:

Yes
Yes

(Amounts are rounded down to the nearest million yen)
1. Status of Management and Assets for Fiscal Period Ended January 31, 2021 (from August 1, 2020 to January 31, 2021)(1) Management Status(% figures are the rate of period-on-period increase (decrease))
Fiscal period
Operating revenue
Operating income
Ordinary income
Net income
million yen%
million yen%
million yen%
million yen%
Ended Jan. 2021
6,672
67.0
3,376
58.4
2,911
56.7
11,801
535.5
Ended Jul. 2020
3,996
23.8
2,131
23.8
1,857
24.3
1,857
24.3
Net income
per unit

Ratio of ordinary income Ratio of ordinary income
to total assets
to operating revenue
yen
%
%
%
Ended Jan. 2021
7,048
16.4
2.0
43.6
Ended Jul. 2020
1,716
3.4
1.7
46.5
(Note) SAR has conducted an investment unit split (the “Investment Unit Split”) to split one investment unit into two investment
units, with July 31, 2020, as the record date and August 1, 2020, as the effective date for the Investment Unit Split. Net income
per unit is calculated assuming that the Investment Unit Split was conducted at the beginning of the fiscal period ended July
31, 2020.
Fiscal period

Ratio of net income
to equity(2) Status of Cash Distribution
Cash distribution
Total
Cash distribution
Total
per unit
cash distribution
in excess of
cash distribution Cash distribution
Fiscal period(not including cash
(not including cash
earnings
in excess of
payout ratio
distribution in excess of distribution in excess of
per unit
earnings
earnings)
earnings)

Ratio of cash
distribution to
net assetsyenmillion yen

yenmillion yen%%

Ended Jan. 2021

1,676

2,806

-

-

23.8

3.2

Ended Jul. 2020

3,436

1,858

-

-

100.1

3.4

(Note 1)
(Note 2)

Total cash distribution for the fiscal period ended July 31, 2020, differs from net income as part of the retained earnings
brought forward is included in the source of distribution.
Total cash distribution for the fiscal period ended January 31, 2021, differs from net income due to the accumulation ofreserve for temporary difference adjustment and other factors.

(3) Financial Position
Fiscal period

Total assets
Net assets
Equity ratio
Net assets per unit
million yen
million yen%
yen
Ended Jan. 2021
179,789
89,60049.8
53,512Ended Jul. 2020
113,035
54,61448.3
50,492(Note) Net assets per unit is calculated assuming that the Investment Unit Split was conducted at the beginning of the fiscal period
ended July 31, 2020.
(4) Status of Cash Flows
Fiscal period

Ended Jan. 2021
Ended Jul. 2020

Net cashprovided by (used in)operating activities
million yen
10,883
3,268

Net cashprovided by (used in)investing activities
million yen(7,443)(3,753)－1 －Net cashprovided by (used in)financing activities
million yen(3,768)
1,232

Cash and cash equivalents
at end of period
million yen
11,0806,219

2. Management Status Forecast for Fiscal Period Ending July 31, 2021 (from February 1, 2021 to July 31, 2021) and Fiscal Period Ending
January 31, 2022 (from August 1, 2021 to January 31, 2022)(% figures are the rate of period-on-period increase (decrease))
Fiscal period

Operating revenue

million yen
Ending Jul. 2021
Ending Jan. 2022

5,512
5,565

Operating income% million yen(17.4)
1.0

2,788
2,801

Ordinary income% million yen(17.4)
0.5

2,349
2,311

Net income% million yen(19.3)
(1.6)

2,348
2,311

Cash distribution
per unit
Cash distribution(not including
in excess of earnings
cash distribution
per unit
in excess of earnings)
%
yen
yen

(80.1)
(1.6)

1,455
1,455

-

(Reference) Forecast net income per unit (Expected net income ÷ expected total number of investment units issued and outstandingat end of period)
Fiscal period ending July 31, 2021:
Expected total number of investment units issued and outstanding at end of period 1,674,389 units
Forecast net income per unit 1,402 yen
Fiscal period ending January 31, 2022:
Expected total number of investment units issued and outstanding at end of period 1,674,389 units
Forecast net income per unit 1,380 yen(Note 1) Cash distribution per unit calculated using the total number of investment units issued and outstanding as of the dateof this report (1,674,389 units).
(Note 2) Cash distribution per unit (not including cash distribution in excess of earnings) differs from the forecast net income
per unit as it is assumed that the amount of reversal of reserve for temporary difference adjustment, etc. willcontinuously be allocated to distributions.
* Others(1) Changes in Accounting Policies, Changes in Accounting Estimates, and Retrospective Restatement① Changes in accounting policies accompanying amendments to accounting standards, etc. : No
② Changes in accounting policies other than ①: No③ Changes in accounting estimates: No④ Retrospective restatement: No(2) Total Number of Investment Units Issued and Outstanding① Total number of investment units issued and outstanding (including own investment units) at end of period
Fiscal period ended Jan. 31, 2021
1,674,389 units
Fiscal period ended Jul. 31, 2020
540,824 units② Number of own investment units at end of period
Fiscal period ended Jan. 31, 2021
0 units
Fiscal period ended Jul. 31, 2020
0 units(Note) For the number of investment units serving as the basis for calculation of net income per unit, please see “Notes on Per
Unit Information” on page 25.
* Financial reports are exempt from audits by a certified public accounting or accounting firms.
* Special Note
The management status outlook and other forward-looking statements contained in this document are based on information thatare currently available and certain assumptions that are deemed reasonable by SAR. Accordingly, the actual management status, etc.
may differ materially due to various factors. In addition, the forecast figures are the current figures calculated under the assumptions
described in “Assumptions Underlying Operating Results Forecasts for Fiscal Period Ending July 31, 2021, and Fiscal Period Ending
January 31, 2022” on pages 3-4. Accordingly, the actual operating revenue, operating income, ordinary income, net income, cash
distribution per unit (not including cash distribution in excess of earnings) and cash distribution in excess of earnings per unit mayvary due to acquisition/disposition of real estate, etc., trends of the real estate market, etc., fluctuations in interest rates, or otherchanges in the circumstances surrounding SAR, etc. in the future. In addition, the forecast is not a guarantee of the amount of cash
distribution.

－

2 －Assumptions Underlying Operating Results Forecasts for
Fiscal Period Ending July 31, 2021, and Fiscal Period Ending January 31, 2022
Item
Calculation period

Assets undermanagement

Operating revenues

Assumptions➢ Fiscal period ending July 31, 2021: February 1, 2021 – July 31, 2021 (181 days)➢ Fiscal period ending January 31, 2022: August 1, 2021 – January 31, 2022 (184 days)➢ It is assumed that, with regard to the assets held by SAR as of the date of this report (53 real estate trust
beneficiary interests, 4 mezzanine loan debts, and 2 equity investments in silent partnerships (collectively,“Currently Held Assets,” with those in the form of real estate trust beneficiary interests being referred toas “Currently Held Assets (Real Estate),” those in the form of mezzanine loan debt being referred to as“Currently Held Assets (Mezzanine),” and those in the form of equity investment in silent partnership
being referred to as “Currently Held Assets (Silent Partnership)”)), there will be no change in assets undermanagement (new property acquisitions, sales of the existing properties, etc.) until the end of the fiscal
period ending January 31, 2022.
➢ However, in reality assets under management may change.
➢ Rent revenues from Currently Held Assets (Real Estates) are calculated based on the details stated in thelease agreements effective as of the date of this report, taking into consideration factors such as market
movements. It is also assumed that there will be no arrears or non-payment of rent by tenants.
➢ Interest revenues or dividend revenues from Currently Held Assets (Mezzanine) are calculated based onoutlines, trust agreements or loan agreements which define contents of Currently Held Assets(Mezzanine) that are effective as of the date of this report. It is also assumed that no interest payments
or dividend payments will be unpaid.
➢ Dividend revenues from Currently Held Assets (Silent Partnership) are calculated as an estimate based on
the assumption that the real estate underlying the cash flow will maintain stable operations.

Operating expenses➢ Among expenses related to rent business which are the main operating expenses, expenses other thandepreciation are calculated on the basis of historical performance data, by reflecting variable expense
factors.
➢ Fixed property taxes, city planning taxes, and other public charges are expected to be 426 million yen in
the fiscal period ending July 31, 2021, and to be 426 million yen in the fiscal period ending January 31,
2022. With respect to real estate trust beneficiary interests, fixed property taxes, city planning taxes, andother public charges in the fiscal year will be settled with the seller on a pro rata basis based on thenumber of days of ownership at the time of acquisition of the properties. However, as SAR includes such
settlement amounts in the acquisition cost, fixed property taxes, city planning taxes, and other publiccharges for fiscal year 2021 related to the acquisition of Urban Park Mitsuike Koen in January 2021 will
not be recorded as expenses for the fiscal period ending July 31, 2021, and the fiscal period ending January
31, 2022. Fixed property taxes, city planning taxes, and other public charges for the property are expected
to be recorded as expenses from the fiscal period ending July 31, 2022.
➢
For expenditures for repair and maintenance of buildings, based on the repair and maintenance plan
prepared by Star Asia Investment Management Co., Ltd, the asset manager of SAR (the “AssetManager”), 193 million yen is expected for the fiscal period ending July 31, 2021, and 187 million yen is
expected for the fiscal period ending January 31, 2022. However, the actual expenditures for repair andmaintenance for the fiscal periods could differ significantly from the estimated amounts, as urgent
expenditures due to damage to buildings may arise due to unexpected factors, and because such
expenditure amounts generally tend to vary significantly from year to year, and do not arise regularly.
➢ Depreciation is calculated using the straight-line method including for ancillary costs and is expected to
be 635 million yen for the fiscal period ending July 31, 2021, and 647 million yen for the fiscal period
ending January 31, 2022.
➢ Operating expenses other than rent business related expenses are expected to be 518 million yen in thefiscal period ending July 31, 2021, and 513 million yen in the fiscal period ending January 31, 2022.

NOI(Net Operating
Income)➢ Total NOI of the entire portfolio is expected to be 3,919 million yen for the fiscal period ending July 31,
2021, and 3,938 million yen for the fiscal period ending January 31, 2022.
➢ NOI is calculated by using the following calculation method.
NOI = rent revenue – rent expenses (excluding depreciation)

Non-operating
expenses➢ The sum of interest expenses and other financing-related expenses is expected to be 439 million yen in
the fiscal period ending July 31, 2021, and 489 million yen in the period ending January 31, 2022.
➢ Within other financing-related expenses noted above, temporary expenses to arise in relation torefinancing described under “Debt Financing” below of 45 million yen for the fiscal period ending July 31,
2021, and 81 million yen for the fiscal period ending January 31, 2022, are expected.

Debt financing➢ As of the date of this report, SAR has outstanding debt of 82,440 million yen. However, it is assumed
that borrowings with repayment dates falling in the fiscal period ending July 31, 2021, and the fiscal
period ending January 31, 2022, will be fully refinanced.
➢ It is assumed that there will be no new borrowings or repayment of existing borrowings, including early
repayment, up to the end of the fiscal period ending January 31, 2022, other than those described above.
－

3 －

Item

Assumptions

Investment units➢ It is assumed that the total number of investment units issued and outstanding will be 1,674,389 units,
the number as of the date of this report, and that there will be no change in the number due to issuanceof new investment units, etc. through the end of the fiscal period ending January 31, 2022.

➢ SAR calculates its distribution per unit (excluding distributions in excess of earnings) pursuant to its cash
distributions policy as set forth in its Articles of Incorporation.
➢ As for the reserve for temporary difference adjustment, SAR plans to continuously reverse 1% or more of
Cash distributions
the initial reserve in each fiscal period and use it mainly to mitigate any negative impact on distributions
per unit
caused by temporary decrease in income or incurred expenses and to avoid the occurrence of corporate(not including
and other tax expenses as a result of any differences between tax and accounting. Moreover, as for cash
cash distribution
distributions (not including cash distribution in excess of earnings) for the fiscal period ending July 31,
in excess of earnings)
2021, and the fiscal period ending January 31, 2022, SAR plans to distribute a total of 2,436 million yen,which is the sum of net income plus the amount of reversal of reserve for temporary difference
adjustment, etc., in each fiscal period.
Cash distributions
in excess of earnings ➢ SAR has no plans to make distributions in excess of earnings as of the date of this report.
per unit

Others➢ SAR assumes that no amendments affecting the above forecast numbers will be made to relevant laws
and regulations, tax policies, accounting standards, listing rules, rules of investment trusts associations,etc.
➢ SAR assumes that there will be no unforeseen material change in general economic conditions or realestate market conditions, etc.

－

4 －

2.

Financial Statements(1) Balance Sheet(Unit: thousand yen)
9th fiscal period(As of July 31, 2020)

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Other
Total current assets
Non-current assets
Property, plant and equipment
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Total property, plant and equipment
Intangible assets
Leasehold rights in trust
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Long-term prepaid expenses
Lease and guarantee deposits
Total investments and other assets
Total non-current assets
Total assets－

5 －10th fiscal period(As of January 31, 2021)

2,303,632
3,915,644
49,312
119,529
10,3896,398,507

3,565,028
7,515,934
82,348
188,497
9,208
11,361,017

34,100,500(2,933,446)
31,167,053
18,395(2,990)15,40555,823(12,054)
43,76846,277(13,817)32,46070,619,311
101,877,998

114
(14)
100
49,326,896(3,460,097)
45,866,798
20,635(3,671)
16,96473,226(14,997)
58,22847,023(16,360)
30,663
117,051,893
163,024,648

3,459,138
3,459,138

4,082,300
4,082,300

853,350
300,000
135,723
10,782
1,299,856
106,636,993
113,035,501

756,206
300,000
245,057
20,5191,321,782
168,428,731
179,789,748

(Unit: thousand yen)
9th fiscal period(As of July 31, 2020)
Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Accounts payable - otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Other
Total non-current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus
Unitholders’ capital surplus
Unappropriated retained earnings (undisposed loss)
Total surplus
Total unitholders’ equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets－

6 －10th fiscal period(As of January 31, 2021)

337,786
14,040,000
417,355
12,748605
48,276698,166
17,332
15,572,270

621,461
2,150,000
22,660,000
541,206
43,534605
252,480
835,11330,58827,134,990

40,280,000
6,595
2,429,860
132,189
42,848,645
58,420,916

57,630,000
6,142
5,197,022
221,075
63,054,239
90,189,230

52,745,966

52,745,966

1,998,562
1,998,562
54,744,528

25,132,218
11,942,013
37,074,231
89,820,197(129,943)(129,943)*1 54,614,584
113,035,501(219,679)(219,679)*1 89,600,518
179,789,748

(2) Statement of Income(Unit: thousand yen)
9th fiscal period
From: February 1, 2020
To: July 31, 2020
Operating revenue
Lease business revenue
Other lease business revenue
Gain on sales of real estate property
Other revenue
Total operating revenue
Operating expenses
Expenses related to rent business
Loss on sales of real estate property
Asset management fee
Asset custody and administrative service fees
Directors’ compensations
Merger expenses
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Reversal of unpaid distribution
Interest on refund
Gain on donation of non-current assets
Other
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing related expenses
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on negative goodwill
Total extraordinary income
Income before income taxes
Income taxes - current
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)*1

3,122,781
192,129*2 648,585
32,582
3,996,079*1

1,173,882
252,533
28,0532,400
303,222
104,149
1,864,242
2,131,837

*1

*1

*1

－

7 －

10th fiscal period
From: August 1, 2020
To: January 31, 2021
5,259,516
389,105*2 993,574
29,933
6,672,130*12,179,316
19,285405,30347,4272,400
448,870
192,798
3,295,402
3,376,728

*2

25
1,131
1
2,816
3,975

51
4,111
1
0
4,164

172,539
105,551
278,091
1,857,721

299,303
170,497
469,801
2,911,090

1,857,721
605
605
1,857,116
141,446
1,998,562

8,891,236
8,891,236
11,802,327
605
605
11,801,722
140,290
11,942,013

(3) Statement of Unitholders’ Equity
9th fiscal period (from February 1, 2020 to July 31, 2020)(Unit: thousand yen)
Valuation and translation
adjustments

Unitholders’ equity
SurplusTotal
net assets

Total
surplus

Total
Total
Deferredvaluation andunitholders’ gains or losses
translation
equityon hedges
adjustments

1,649,263

1,649,263

54,395,229

54,299,423

Dividends from surplus(1,507,817)(1,507,817)(1,507,817)(1,507,817)

Net income

1,857,116

1,857,116

1,857,116

1,857,116

Unappropriatedretainedearnings(undisposed
loss)

Unitholders’capitalBalance at beginning of theperiodChanges of items during theperiodNet changes of items otherthan unitholders’ equity
Total changes of items during
the period
Balance at end of the period

52,745,966(95,806)(95,806)(34,137)(34,137)(34,137)-

349,298349,298349,298(34,137)(34,137)

315,161*1 52,745,966

1,998,562

1,998,562

54,744,528(129,943)(129,943)

54,614,584－

8 －10th fiscal period (from August 1, 2020 to January 31, 2021)
Unitholders’ equity
Surplus
Unappropriatedretained
Capital surplus
earnings(undisposed
loss)

Unitholders’capitalBalance at beginning of theperiodChanges of items during theperiod52,745,966

Increase by merger-

1,998,562

25,132,218

Total
surplusTotal
unitholders’equity1,998,562

54,744,528

25,132,218

25,132,218

Dividends from surplus(1,858,271)(1,858,271)(1,858,271)

Net income

11,801,722

11,801,722

11,801,722

Net changes of items otherthan unitholders’ equity
Total changes of items during
the period
Balance at end of the period-

25,132,218

9,943,450

35,075,669

35,075,669*1 52,745,966

25,132,218

11,942,013

37,074,231

89,820,197(Unit: thousand yen)
Valuation and translation
adjustments
Total
Deferredvaluation andgains or losses
translation
on hedges
adjustments
Balance at beginning of theperiodChanges of items during theperiod(129,943)(129,943)

Total
net assets

54,614,584

Increase by merger

25,132,218

Dividends from surplus(1,858,271)

Net income

11,801,722

Net changes of items otherthan unitholders’ equity
Total changes of items during
the period
Balance at end of the period(89,735)(89,735)(89,735)(89,735)(89,735)

34,985,933(219,679)(219,679)

89,600,518－

9 －(4) Statement of Cash Distributions(Unit: yen)I.

Unappropriated retained earnings

II. Cash distribution[Cash distribution per unit]
Cash distribution of earnings[Cash distribution of earnings per unit]
III. Voluntary reserve
Provision of reserve for temporary difference adjustment*1

IV. Retained earnings carried forward

9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

1,998,562,151

11,942,013,083

1,858,271,264

2,806,275,964[3,436]
1,858,271,264[1,676]2,806,275,964[3,436][1,676]-

8,891,236,430

140,290,887

244,500,689

Method of calculation of amount of cash distributions
9th fiscal period (from February 1, 2020 to July 31, 2020):
Pursuant to the cash distribution policy provided in Article 35, Paragraph 1 of SAR’s Articles of Incorporation, SAR shall distribute inexcess of the amount equivalent to 90% of the amount of distributable earnings of SAR as defined in Article 67-15, Paragraph 1 of
the Act on Special Measures Concerning Taxation. In accordance with such policy, concerning cash distribution of earnings (notincluding cash distribution in excess of earnings), the decision was made to distribute 1,858,271,264 yen, an amount approximatedto net income and an integral multiple of the total number of issued investment units of 540,824.
10th fiscal period (from August 1, 2021 to January 31, 2021):
Pursuant to the cash distribution policy provided in Article 35, Paragraph 1 of SAR’s Articles of Incorporation, SAR shall distribute inexcess of the amount equivalent to 90% of the amount of distributable earnings of SAR as defined in Article 67-15, Paragraph 1 of
the Act on Special Measures Concerning Taxation. In accordance with such policy, concerning cash distribution of earnings (notincluding cash distribution in excess of earnings), the decision was made to accumulate 8,891,236,430 yen, which is equivalent tothe amount of gain on negative goodwill, of the unappropriated retained earnings as reserve for temporary difference adjustment,
and distribute 2,806,275,964 yen of the remaining amount.

－

10

－

(5) Statement of Cash Flows(Unit: thousand yen)
9th fiscal period
From: February 1, 2020
To: July 31, 2020
Cash flows from operating activities
Income before income taxes
Depreciation
Gain on negative goodwill
Interest income
Interest expenses
Decrease (increase) in operating accounts receivable
Increase (decrease) in accrued consumption taxes
Decrease (increase) in prepaid expenses
Decrease (increase) in long-term prepaid expenses
Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable - other
Increase (decrease) in advances received
Decrease from sales of property, plant and equipment in trust
Other, net
SubtotalInterest income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of property, plant and equipment in trust
Repayments of tenant leasehold and security deposits
Repayments of tenant leasehold and security deposits in trust
Proceeds from tenant leasehold and security deposits in trust
Purchase of investment securities
Proceeds from redemption of investment securities
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from short-term loans payable
Repayments of short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Dividends paid
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Net increase in cash and cash equivalents due to merger
Cash and cash equivalents at end of period

－

11

－

10th fiscal period
From: August 1, 2020
To: January 31, 2021

1,857,721
432,258(25)
172,539(3,703)
12,690(7,093)(14,225)(59,255)
147,767
166,974
734,465957
3,441,071
25(171,694)(696)
3,268,704

11,802,327
628,353(8,891,236)(51)
299,303
21,847
149,670(12,177)(76,386)
57,449(60,409)(237,771)
7,501,405
1,457
11,183,783
51(298,957)(1,562)
10,883,314(3,582,328)(123)(104,949)
75,044(150,000)
9,275
80(3,753,001)(114)(7,305,472)(453)(433,786)
199,839
96,646263(7,443,077)

10,760,000(8,020,000)(1,507,655)
1,232,344
748,0475,471,229*1 6,219,277

2,150,000(4,900,000)
12,750,000(11,080,000)(2,688,002)(3,768,002)(327,765)
6,219,277
5,189,451*1 11,080,963

(6) Notes on the Going Concern Assumption
Not applicable.
(7) Notes on Matters Concerning Significant Accounting Policies
1. Evaluation standards
Other securities:
and methods ofThose with fair value
valuation of securities
Fair value method or market value method (Variances are directly included in net assets.)Those with no fair value
Cost method through moving-average method
As for silent partnership equity interests, the method of incorporating the amountequivalent to equity interests corresponding to net amount of gain or loss from silent
partnership is adopted.
2. Method of
Property, plant and equipment (including trust assets)
depreciation of
The straight-line method is adopted. The useful life of primary property, plant and equipment is as follows:
non-current assets
Buildings
2-69 years
Structures
7-30 years
Machinery and equipment
7-17 years
Tools, furniture and fixtures 2-15 years
3. Standards for
Accounting for fixed property tax, etc.
revenue and expense
Accounting for fixed property tax, city planning tax, depreciable asset tax, etc. (“fixed property tax,
recognitionetc.”) on real estate or beneficiary interest in trust for real estate held is that of the tax amountassessed and determined, and the amount corresponding to the concerned calculation period isexpensed as expenses related to rent business.
The amount equivalent to fixed property tax, etc. in the initial fiscal year borne by SAR uponacquisition of real estate or beneficiary interest in trust for real estate is not recognized as expenses
but included in the cost of acquisition of the concerned real estate, etc. In the fiscal period underreview, the amount equivalent to fixed property tax, etc. included in the cost of acquisition of realestate, etc. was 21,782 thousand yen.
4. Method of(1) Hedge accounting approachhedge accounting
Deferral hedge accounting is adopted.
(2) Hedging instruments and hedged items
Hedging instruments: Interest rate swap transaction
Hedged items: Interest on loans(3) Hedging policy
SAR conducts derivative transactions for the purpose of hedging the risks provided in its Articles
of Incorporation pursuant to basic rules on risk management.
(4) Method of assessing the effectiveness of hedging
The effectiveness of hedging is assessed by comparing the cumulative change in cash flows of
the hedging instruments with the cumulative change in cash flows of the hedged items andverifying the ratio of the amount of change in the two.
5. Scope of funds
The funds (cash and cash equivalents) in the statement of cash flows comprise cash on hand and cashin the statement ofin trust, demand deposits and deposits in trust, and short-term investments with a maturity of three
cash flows (cash andmonths or less from the date of acquisition that are readily convertible to cash and that are subject
cash equivalents)
to an insignificant risk of changes in value.
6. Other significant(1) Accounting for beneficiary interest in trust for real estate, etc.
matters serving as theConcerning beneficiary interest in trust for real estate, etc. held, all accounts of assets andbasis for preparation
liabilities within trust assets as well as all accounts of revenue and expenses from the trust assetsof financial statements
are recognized in the relevant account item of the balance sheet and the statement of income.
The following material items of the trust assets recognized in the relevant account item areseparately listed on the balance sheet.
① Cash and deposits in trust② Buildings in trust; Structures in trust; Machinery and equipment in trust; Tools, furniture andfixtures in trust; Land in trust③ Leasehold rights in trust④ Tenant leasehold and security deposits in trust(2) Accounting for consumption tax, etc.
Taxes are excluded from the transaction amounts in accounting for consumption tax and local
consumption tax.
Non-deductible consumption tax on acquisition of assets is included in the acquisition cost ofeach asset.
－

12

－

(8) Notes to the Financial Statements[Notes to the Balance Sheet]*1 Minimum net assets as provided in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment Corporations(Unit: thousand yen)
9th fiscal period(As of July 31, 2020)

10th fiscal period(As of January 31, 2021)

50,00050,000[Notes to the Statement of Income]*1 Breakdown of operating income (loss) from real estate leasing(Unit: thousand yen)
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

2,744,081
264,725

4,476,854
555,635

Parking revenue
Facility use revenue

98,93812,518

190,492
31,703

Other rental revenue

2,517

A. Operating revenue from real estate leasing
Lease business revenue
Rental revenue
Common area maintenance revenue

3,122,781

4,830

5,259,516

Other lease business revenue
Utilities reimbursement

152,573

Other revenue

39,556

315,752
192,12973,352

3,314,911

Total operating revenue from real estate leasing

389,105
5,648,622

B. Operating expenses from real estate leasing
Expenses related to rent business
Management fee

157,872

412,710

Utilities expenses
Taxes and dues

148,284
240,373

301,349
425,403

Repair expenses
Trust fee

93,667
13,779181,948
22,614

Insurance premium
Depreciation

4,846
432,258

9,110
628,353

Other expenses

82,800197,825

Total operating expenses from real estate leasing
C. Operating income (loss) from real estate leasing[A－B]*2 Breakdown of gain(loss) on sales of real estate property
9th fiscal period (from February 1, 2020 to July 31, 2020)
Alphabet Seven (quasi co-ownership interest of 40%) (unit: thousand yen)
Real Estate Sale Income
Real Estate Sale Cost

1,400,000
734,465

Other Real Estate Sale Expenses

16,949Gain on Real Estate Sale

648,585－

13－

1,173,882

2,179,316

2,141,028

3,469,305

10th fiscal period (from August 1, 2020 to January 31, 2021)
Suroy Mall Nagamine(unit: thousand yen)
Real Estate Sale Income

3,500,000

Real Estate Sale Cost
Other Real Estate Sale Expenses

3,443,833
37,905Gain on Real Estate Sale

18,261

Funabashi Nishiura Logistics I(unit: thousand yen)

Real Estate Sale Income
Real Estate Sale Cost

3,030,000
2,957,546

Other Real Estate Sale Expenses

91,739Loss on Real Estate Sale

19,285Alphabet Seven (quasi co-ownership interest of 60%)

(unit: thousand yen)

Real Estate Sale Income

2,100,000

Real Estate Sale Cost
Other Real Estate Sale Expenses

1,100,025
24,661Gain on Real Estate Sale

975,313－

14－

[Notes to the Statement of Unitholders’ Equity]*1 Total number of investment units authorized and total number of investment units issued and outstanding
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

10,000,000 units

10,000,000 units

540,824 units

1,674,389 units

Total number of investment units authorized
Total number of investment units issued and outstanding[Notes to the Statement of Cash Distributions]
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

Not applicable.

*1 Reserve for temporary difference adjustment
SAR accumulated 8,891,236 thousand yen as reserve fortemporary difference adjustment in the 10th fiscal period.
From the 11th fiscal period, SAR plans to reverse the sameamount or more in each fiscal period over a period of up to 50
years.

[Notes to the Statement of Cash Flows]*1 Reconciliation of cash and cash equivalents at end of period to the amount of balance sheet items(Unit: thousand yen)
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

Cash and deposits

2,303,632

3,565,028

Cash and deposits in trust

3,915,644

7,515,934

Cash and cash equivalents

6,219,277

11,080,963*2 Description of significant non-cash transactions
9th fiscal period (from February 1, 2020 to July 31, 2020)
Not applicable.
10th fiscal period (from August 1, 2020 to January 31, 2021)
The main breakdown of assets and liabilities succeeded from Sakura Sogo REIT Investment Corporation (“SSR”) with which
SAR conducted an absorption-type merger is as follows. Unitholders’ capital surplus increased by 25,132,218 thousand
yen due to the merger.
(Unit: thousand yen)
Current assets

5,301,130

Non-current assets

62,647,946

Total assets

67,949,077

Current liabilities

12,624,609

Non-current liabilities

21,301,013

Total liabilities

33,925,622

－

15

－

[Notes on Lease Transactions]Operating leases (as lessor)
Future minimum lease payments(Unit: thousand yen)
9th fiscal period
As of Jul. 31, 2020

10th fiscal period
As of Jan. 31, 2021

Not later than 1 year

2,837,305

5,322,499

Later than 1 year

7,716,198

8,998,739

10,553,503

14,321,239

Total[Notes on Financial Instruments]
1.

Matters concerning status of financial instruments(1) Policy for handling financial instruments
SAR shall procure funds to allocate to acquisition of real estate related assets, repayment of interest-bearing liabilities,
etc. through mainly issuance of investment units, borrowing from financial institutions, issuance of investment
corporation bonds, etc. Upon procuring funds through interest-bearing liabilities, due consideration shall be given tofund procurement agility and financial stability.
(2) Description of financial instruments and associated risks, and risk management system
The funds procured through loans, which shall be for the purpose of mainly acquisition of assets, are exposed to liquidity
risk until the repayment date, but the concerned risks are managed by taking such measures as lengthening the
procurement periods and staggering the maturities. In addition, loans with floating interest rates are exposed to interest
rate fluctuation risk, but derivative transactions (interest rate swap transactions) are utilized as hedging instruments to,in effect, convert interest rates to fixed rates in order to mitigate that risk. For the hedge accounting approach, hedging
instruments, hedged items, hedging policy and method of assessing the effectiveness of hedging, please refer to “4.
Method of hedge accounting” described under “Notes on Matters Concerning Significant Accounting Policies” earlier inthis document.
(3) Supplementary explanation to matters concerning fair value, etc. of financial instruments
Not applicable.

2.

Matters concerning fair value, etc. of financial instruments
The carrying amount and fair value as of July 31, 2020, and the amount of difference between these, are as follows.
Financial instruments for which estimation of fair value is recognized to be extremely difficult are not included. Pleaserefer to “Note 2”.
(Unit: thousand yen)
Carrying amount

Fair value

Amount of difference(1) Cash and deposits

2,303,632

2,303,632-(2) Cash and deposits in trust

3,915,644

3,915,644-(3) Investment securities

674,110674,110-(4) Long-term loans receivable

300,000

300,000-

7,193,387

7,193,387-(6) Current portion of long-term loans payable

14,040,000

14,040,000-(7) Long-term loans payable

40,280,000

40,280,000-

54,320,000

54,320,000-(129,943)(129,943)-

Assets total

Liabilities total(8) Derivative transactions (*)

－

16

－

The carrying amount and fair value as of January 31, 2021, and the amount of difference between them, are as follows.
Financial instruments for which estimation of fair value is recognized to be extremely difficult are not included. Pleaserefer to “Note 2”.
(Unit: thousand yen)
Carrying amount

Fair value

Amount of difference(1) Cash and deposits

3,565,028

3,565,028-(2) Cash and deposits in trust

7,515,934

7,515,934-(3) Investment securities

673,480

673,480-(4) Long-term loans receivable

300,000

300,000-

12,054,443

12,054,443-

Assets total(5) Short-term loans payable

2,150,000

2,150,000-(6) Current portion of long-term loans payable

22,660,000

22,660,000-(7) Long-term loans payable

57,630,000

57,658,969

28,96982,440,000

82,468,969

28,969(219,679)(219,679)-

Liabilities total(8) Derivative transactions (*)(*)

Assets and liabilities arising from derivative transactions are offset and presented in the net amount, with the balance shown in parentheses ( )when in a net liability position.

(Note 1) Method of calculation of the fair value of financial instruments(1) Cash and deposits; (2) Cash and deposits in trust; (5) Short-term loans payables; (6) Current portion of long-term loans payable
Since these are settled in a short period of time, the fair value is approximately the same as the book value, and thus stated at book value.
(3) Investment securities; (4) Long-term loans receivable;
Since interest income etc. from mezzanine loan debt (corporate bonds, beneficiary interest in trust and loans receivable) are all based on
floating interest rates under terms and conditions stipulating that interest rates be reviewed every set period of time, the fair value isapproximately the same as the book value, and thus stated at book value.
(7) Long-term loans payables
These are calculated by the present value obtained by discounting the total principal and interest by the rate expected when similar funds are
additionally borrowed in correspondence with the remaining term. Since long-term loans payable with floating interest rates are under terms
and conditions that interest rates be reviewed every set period of time, the fair value is approximately the same as the book value, and thusstated at that value.
(8) Derivative transactions
Please refer to “Notes on Derivative Transactions” later in this document.
(Note 2) Financial instruments for which estimation of fair value is recognized to be difficult
Category
Tenant leasehold and security deposits (*1)
Tenant leasehold and security deposits in trust (*1)
Investment securities (*2)

(Unit: thousand yen)
10th fiscal period
As of Jan. 31, 2021
6,142
5,197,022
82,7269th fiscal period
As of Jul. 31, 2020
6,595
2,429,860
179,240(*1) Tenant leasehold and security deposits and tenant leasehold and security deposits in trust are not subject to valuation at fair value because areasonable estimation of cash flows is recognized to be extremely difficult due to there being no market value and difficulty of calculating theactual deposit period from when lessees move in to when they move out.
(*2) Fair values of silent partnership equity interest in investment securities are not subject to disclosure of fair value as they have no market value
and their fair values are extremely difficult to recognize.
(Note 3) Amount of redemption of monetary claims scheduled to be due after the date of settlement of accounts
9th fiscal period (as of July 31, 2020)(Unit: thousand yen)
Later than 1 year Later than 2 years Later than 3 years Later than 4 years
Not later thanand not later than and not later than and not later than and not later than Later than 5 years
1 year
2 years
3 years
4 years
5 years
Cash and deposits

2,303,632

-

-

-

-

-

Cash and deposits in trust

3,915,644

-

-

-

-

-

Investment securities

-

-

-

524,110150,000-

Long-term loans
receivable

-

-

-

300,000

-

-

Total

6,219,277--

824,110150,000

-

－

17

－

10th fiscal period (as of January 31, 2021)(Unit: thousand yen)
Later than 1 year Later than 2 years Later than 3 years Later than 4 years
and not later than and not later than and not later than and not later than Later than 5 years
2 years
3 years
4 years
5 years

Not later than
1 yearCash and deposits

3,565,028

-

-

-

-

-

Cash and deposits in trust

7,515,934

-

-

-

-

-

Investment securities--

523,480-

150,000-

Long-term loans
receivable--

300,000

-

-

-

Total

11,080,963-

823,480-

150,000-(Note 4) Amount of repayment of loans scheduled to be due after the date of settlement of accounts
9th fiscal period (as of July 31, 2020)(Unit: thousand yen)
Later than 1 year Later than 2 years Later than 3 years Later than 4 years
Not later thanand not later than and not later than and not later than and not later than Later than 5 years
1 year
2 years
3 years
4 years
5 years
Long-term loans payable

14,040,000

15,450,000

4,690,000

12,840,000

7,300,000

-

Total

14,040,000

15,450,000

4,690,000

12,840,000

7,300,000-

10th fiscal period (as of January 31, 2021)
Not later than
1 year(Unit: thousand yen)
Later than 1 year Later than 2 years Later than 3 years Later than 4 years
and not later than and not later than and not later than and not later than Later than 5 years
2 years
3 years
4 years
5 years

Short-term loans payable

2,150,000

-

-

-

-

-

Long-term loans payable

22,660,000

15,350,000

14,630,000

8,500,000

19,150,000

-

Total

24,810,000

15,350,000

14,630,000

8,500,000

19,150,000

-

－

18

－

[Notes on Securities]
Other securities
9th fiscal period (as of July 31, 2020)
Category

Carrying amount(1) Stocks(Unit: thousand yen)
Difference

Acquisition cost
-

-

-

-

-

-

② Corporate bonds

-

-

-

③ Others

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

400,000

400,000-(2) Bonds
Carrying amountgreater thanacquisition cost

① Government bonds,
municipal bonds, etc.

(3) Others
Subtotal(1) Stocks(2) Bonds
Carrying amount lessthan or equal toacquisition cost

① Government bonds,
municipal bonds, etc.
② Corporate bonds③ Others(3) Others
Subtotal
Total

-

-

-

274,110274,110-674,110674,110-674,110674,110-(*) Silent partnership equity interests (carrying amount: 179,240 thousand yen) are not included above because they have nomarket value and their fair values are extremely difficult to recognize.
10th fiscal period (as of January 31, 2021)
Category

Carrying amount(1) Stocks(Unit: thousand yen)
Difference

Acquisition cost
-

-

-

-

-

-

② Corporate bonds

-

-

-

③ Others

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

400,000

400,000-③ Others---(3) Others

273,480

273,480-

673,480

673,480-

673,480

673,480-(2) Bonds
Carrying amountgreater thanacquisition cost

① Government bonds,
municipal bonds, etc.

(3) Others
Subtotal(1) Stocks(2) Bonds
Carrying amount lessthan or equal toacquisition cost

① Government bonds,
municipal bonds, etc.
② Corporate bonds

Subtotal
Total(*) Silent partnership equity interests (carrying amount: 82,726 thousand yen) are not included in above because they haveno market value and their fair values are extremely difficult to recognize.

－

19

－

[Notes on Derivative Transactions]
1. Derivative transactions to which hedge accounting is not applied
9th fiscal period (as of July 31, 2020)
Not applicable.
10th fiscal period (as of January 31, 2021)
Not applicable.
2. Derivative transactions to which hedge accounting is applied
9th fiscal period (as of July 31, 2020)
The following is the contract amount or the amount equivalent to the principal provided in the contract as of the date ofsettlement of accounts for each hedge accounting approach.
(Unit: thousand yen)Hedge
accounting
approach

Type, etc. of derivative transactionMainhedged item

Principle
method ofaccounting

Interest rate swap transaction(floating receivable; fixed payable)

Long-termloans payable

Contract amount, etc. (Note 1)
Of which,later than 1 year
44,280,000

32,980,000

Fair value(Note 2)

(129,943)(Note 1) Contract amount, etc. is based on notional principal.
(Note 2) Fair value is calculated based on the price quoted by lending financial institutions, etc.

10th fiscal period (as of January 31, 2021)
The following is the contract amount or the amount equivalent to the principal provided in the contract as of the date ofsettlement of accounts for each hedge accounting approach.
(Unit: thousand yen)Hedge
accounting
approach

Type, etc. of derivative transactionMainhedged item

Principle
accounting

Interest rate swap transaction(floating receivable; fixed payable)

Long-termloans payable

Contract amount, etc. (Note 1)
Of which,later than 1 year
52,630,000

45,330,000

Fair value(Note 2)(219,679)(Note 1) Contract amount, etc. is based on notional principal.
(Note 2) Fair value is calculated based on the price quoted by lending financial institutions, etc.

[Notes on Retirement Benefits]
9th fiscal period (as of July 31, 2020)
Not applicable.
10th fiscal period (as of January 31, 2021)
Not applicable.
[Notes on Tax-Effect Accounting]1.

Breakdown of main causes for occurrence of deferred tax assets and deferred tax liabilities(Unit: thousand yen)
9th fiscal period
As of July 31, 2020

10th fiscal period
As of January 31, 2021

Deferred tax assets
Valuation adjustment upon merger-

1,230,867

Acquisition cost of securities
Deferred gains or losses on hedges

1,359
40,8802,269
69,111

Subtotal
Valuation allowance

42,239(42,239)

1,302,248(1,302,248)

-

-

-

-

Total
Deferred tax assets, net

－

20

－

2.

Breakdown of major components that caused any significant differences between the statutory tax rate and the effective
income tax rate after application of tax-effect accounting(Unit: %)9th fiscal period
As of July 31, 2020

10th fiscal period
As of January 31, 2021

Statutory tax rate
[Adjustments]

31.46

31.46

Deductible distributions payable
Gain on negative goodwill(31.46)-(5.94)(23.70)

Reversal of excess depreciation
Others0.04(1.88)
0.07

Effective income tax rate
after application of tax-effect accounting

0.03

0.01

[Notes on Share of Profit or Loss of Entities Accounted for Using Equity Method, etc.]
9th fiscal period (as of July 31, 2020)
Not applicable.
10th fiscal period (as of January 31, 2021)
Not applicable.
[Notes on Related-Party Transactions]
1.

Parent company, major corporate unitholders, etc.
9th fiscal period (from February 1, 2020 to July 31, 2020)
Not applicable.
10th fiscal period (from August 1, 2020 to January 31, 2021)
Not applicable.

2.

Affiliated companies, etc.
9th fiscal period (from February 1, 2020 to July 31, 2020)
Not applicable.
10th fiscal period (from August 2020 to January 31, 2021)
Not applicable.

3.

Fellow subsidiaries, etc.
9th fiscal period (from February 1, 2020 to July 31, 2020)
Not applicable.
10th fiscal period (from August 2020 to January 31, 2021)
Not applicable.

4.

Directors, major individual unitholders, etc.
9th fiscal period (from February 1, 2020 to July 31, 2020)

Type

Director, or
close
relative of
director

Name ofcompany,
etc. orpersonAtsushi
Kato

Address－

Capital stock Description ofor investments business orin capital
occupation－

Percentage ofvoting rights,
etc. held by(in) SAR

Description oftransaction

Transaction
amount(thousandyen)

Account
item

Balance at
end ofperiod(thousand
yen)

0.02%

Payment of asset
management fee
to the AssetManager(Note 1)

282,733(Note 2)
(Note 3)

Accounts
payable –others291,537(Note 2)

Executive
Director of
SAR, andPresident andCEO of theAsset Manager

－

21

－

10th fiscal period (from August 1, 2020 to January 31, 2021)

Type

Director, or
close
relative of
director(Note 1)
(Note 2)
(Note 3)Name ofcompany,
etc. orpersonAddress

Capital stock Description ofor investments business orin capital
occupation

Percentage ofvoting rights,
etc. held by(in) SAR

Description oftransaction

Transaction
amount(thousandyen)

Account
item

Balance at
end ofperiod(thousandyen)

Executive
Payment of asset
Director ofmanagement fee
871,288
Accounts
Atsushi
SAR, and
445,834
0.02%
to the Asset(Note 2)
payable –－－Kato
President and(Note 2)
Manager(Note 3)othersCEO of the(Note 1)
Asset Manager
The transaction was conducted by Atsushi Kato as President and CEO of a third party (the Asset Manager), and the transaction amountis based on the terms and conditions provided in the Articles of Incorporation of SAR.
Of the amounts above, the transaction amount does not include consumption tax, while the balance at the end of the period includes
consumption tax.
The asset management fee for the 9th fiscal period includes the acquisition incentive portion included in the book value of individual
real estate, etc. in the amount of 16,200 thousand yen and the property transfer incentive portion in the amount of 14,000 thousand
yen. The asset management fee for the 10th fiscal period includes the acquisition incentive portion included in the book value ofindividual real estate, etc. in the amount of 66,660 thousand yen, the property transfer incentive portion in the amount of 86,300
thousand yen and the merger incentive portion in the amount of 313,025 thousand yen.

[Notes to the Business Combination]
Business combination through acquisition
1. Overview of business combination(1) Name and business description of acquired entity
Name of acquired entity: Sakura Sogo REIT Investment Corporation (“SSR”)
Business description: Investing in and managing mainly specified assets based on the Investment Trusts Act(2) Main reason for business combination
The Merger was conducted based on the determination that realization of the Merger will contribute to maximization ofunitholder value for both SAR and SSR, by improving revenue stability owing to expansion of asset size, increase of DPU
as a result of cost reduction, and enhanced liquidity of investment units due to an increase in market capitalization.
(3) Date of business combination (effective date of merger)
August 1, 2020
(4) Legal form of business combination
Absorption-type merger with SAR as the surviving corporation and SSR as the dissolving corporation.
(5) Name of investment corporation after business combination
Star Asia Investment Corporation(6) Main grounds for the determination of acquiring entity
SAR became the acquiring entity after comprehensively taking into account the corporate size including the amount of
total assets and net income, relative voting rights ratio of unitholders, composition of board of directors, etc. and otherfactors based on the Accounting Standard for Business Combinations.
2. Business period of acquired entity included in the income statement for the 10th fiscal period
From August 1, 2020 to January 31, 2021
3. Acquisition cost of acquired entity and its breakdown
Fair value of SAR’s investment units delivered on the date of business combination

25,132,218 thousand yen

4. Exchange ratio of investment units delivered as compensation for acquisition, calculation method of such ratio and numberof investment units delivered(1) Exchange ratio of investment units
SAR allocated and delivered to unitholders 1.78 SAR investment units for every 1.0 SSR investment unit. SAR has
conducted an investment unit split to split one investment unit into two investment units with July 31, 2020, as the record
date.
－

22

－

(2) Calculation method
SAR appointed Nomura Securities Co., Ltd. and SSR appointed Mizuho Securities Co., Ltd. as the financial advisors, andrequested the calculation of the merger ratio. They calculated the merger ratio based on valuation methods including themarket investment unit price method and dividend discount model (DDM) method, and judged that the above exchange
ratio is appropriate as a result of having repeated discussions and negotiations by comprehensively taking into accountfactors such as the result of calculation.
(3) Number of investment units delivered
592,741 units
5. Description and amount of major acquisition-related expenses
Description

Amount (thousand yen)

Merger fee

313,025

6. Matters concerning distribution of acquisition cost(1) Amount of assets succeeded and liabilities assumed on the date of business combination and the main breakdown ofsuch assets and liabilities(Unit: thousand yen)
Current assets

5,301,130

Non-current assets

62,647,946

Total assets

67,949,077

Current liabilities

12,624,609

Non-current liabilities

21,301,013

Total liabilities

33,925,622(2) Amount and cause for occurrence of negative goodwill
Amount of negative goodwill: 8,891,236 thousand yen
Cause for occurrence:

Accounting:

Since the market value of net assets of SSR upon the business combination
exceeded the acquisition cost, the difference is recognized as negative
goodwill.
Recorded in lump sum as extraordinary income in the 10th fiscal period.

7. Estimated amount of impact on the statement of income for the 10th fiscal period when assuming that the businesscombination has been completed on the date of commencement of the 10th fiscal period
There is no impact as the date of business combination and the date of commencement of the 10th fiscal period are thesame.
[Notes on Asset Retirement Obligations]
9th fiscal period (as of July 31, 2020)
Not applicable.
10th fiscal period (as of January 31, 2021)
Not applicable.

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23

－

[Notes on Investments in Rental Properties]
SAR owns rental real estate, etc. for the purpose of earning revenue from leasing. The carrying amount, amount of increase(decrease) during the period and fair value of these investments in rental properties are as follows:(Unit: thousand yen)
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

102,863,386

105,337,137

2,473,750

61,769,811

105,337,137

167,106,948

115,290,000

175,821,000

Carrying amount
Balance at beginning of period
Amount of increase (decrease) during period
Balance at end of period
Fair value at end of period(Note 1) Carrying amount is the amount of the cost of acquisition, less accumulated depreciation.
(Note 2) Of the amount of increase (decrease) in investments in rental properties during the 9th fiscal period, the amount of increase is mainly
attributable to acquisition of real estate beneficiary interest in trust of two properties (3,449,443 thousand yen) and capital expenditures(188,214 thousand yen), while the amount of decrease is mainly attributable to disposition of real estate beneficiary interest in trust of aproperty (quasi co-ownership: 40%) (734,465 thousand yen) and depreciation (432,258 thousand yen). Of the amount of increase (decrease)during the 10th fiscal period, the amount of increase is mainly attributable to the succession of real estate beneficiary interest in trust of 18
properties from SSR with which SAR conducted an absorption-type merger (62,605,000 thousand yen), acquisition of real estate beneficiaryinterest in trust of two properties (6,962,670 thousand yen) and capital expenditures (331,900 thousand yen), while the amount of decreaseis mainly attributable to disposition of real estate beneficiary interest in trust of three properties (60% quasi co-ownership interest for one ofthem) (7,501,405 thousand yen) and depreciation (628,353 thousand yen).
(Note 3) Fair value at the end of the period is the appraisal value by an outside real estate appraiser. Of the fair value at the end of the 9th fiscal period,that of Alphabet Seven (quasi co-ownership interest: 60%) is based on the transfer price (2,100,000 thousand yen) stated in the contract dated
March 2, 2020.

Income (loss) concerning investments in rental properties is as stated in “Notes to the Statement of Income” earlier in thisdocument.
[Notes on Segment Information]
1. Segment information
Segment information is omitted because SAR operates a single segment, which is the real estate leasing business.
2.

Related information
9th fiscal period (from February 1, 2020 to July 31, 2020)(1) Information about products and services
Information about products and services is omitted because net sales to external customers for a single product andservice category are in excess of 90% of operating revenue on the statement of income.
(2) Information about geographic areas① Net sales
Information about net sales is omitted because net sales to external customers in Japan are in excess of 90% of
operating revenue on the statement of income.
② Property, plant and equipment
Information about property, plant and equipment is omitted because the amount of property, plant and equipment
located in Japan is in excess of 90% of the amount of property, plant and equipment on the balance sheet.
(3) Information about each major customer(Unit: thousand yen)
Customer nameOperating revenue
648,585(Note)

Kanden Realty & Development Co., Ltd.

Segment
Real estate leasing business(Note) Operating revenue is gain on sale of Alphabet Seven (quasi co-ownership interest: 40%).

－

24

－

10th fiscal period (from August 1, 2020 to January 31, 2021)(1) Information about products and services
Information about products and services is omitted because net sales to external customers for a single product andservice category are in excess of 90% of operating revenue on the statement of income.
(2) Information about geographic areas① Net sales
Information about net sales is omitted because net sales to external customers in Japan are in excess of 90% of
operating revenue on the statement of income.
② Property, plant and equipment
Information about property, plant and equipment is omitted because the amount of property, plant and equipment
located in Japan is in excess of 90% of the amount of property, plant and equipment on the balance sheet.
(3) Information about each major customer(Unit: thousand yen)
Customer nameOperating revenue
975,313(Note)

Kanden Realty & Development Co., Ltd.

Segment
Real estate leasing business(Note) Operating revenue is gain on sale of Alphabet Seven (quasi co-ownership interest: 60%).
[Notes on Per Unit Information]
9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

Net assets per unit

50,492 yen

53,512 yen

Net income per unit

1,716 yen

7,048 yen

(Note 1) Net income per unit is calculated by dividing net income by the daily weighted average number of investment units. In addition, diluted net income
per unit is not stated, because there are no diluted investment units.
(Note 2) SAR has conducted an investment unit split to split one investment unit into two investment units with August 1, 2020, as the effective date. Net
assets per unit and net income per unit are calculated assuming that the Investment Unit Split was conducted at the beginning of the previous
fiscal period.
(Note 3) The basis for calculation of net income per unit is as follows:

Net income (thousand yen)Amount not attributable to common unitholders(thousand yen)
Net income attributable to common investment units(thousand yen)
Average number of investment units during period (units)

9th fiscal period
From: February 1, 2020
To: July 31, 2020

10th fiscal period
From: August 1, 2020
To: January 31, 2021

1,857,116

11,801,722--

1,857,116

11,801,722

1,081,648

1,674,389[Notes on Significant Subsequent Events]
Not applicable.
[Additional Information](Accounting estimates due to the spread of COVID-19)
A rent system in which rents are entirely or partially linked to the operating revenue, etc. of hotels has been adopted for some
hotel properties owned by SAR including properties for which lease agreements have been newly concluded, and variable rents
are unlikely to occur as of the end of the 10th fiscal period due to the temporary closure of hotels and decline in occupancy rates.
SAR estimates future cash flow based on the assumption that the economic environment surrounding said properties will recovermoderately upon the application of impairment accounting of non-current assets. Thus Operating condition or financial conditionof SAR may be influenced by the spread of COVID -19 in future.

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25

－

(9) Changes in Total Number of Investment Units Issued and Outstanding
The following are the changes in unitholders’ capital and total number of investment units issued and outstanding from the dateof establishment of SAR to the end of the 10th fiscal period.
Total number of investment
Unitholders’ capitalunits issued and outstanding(thousand yen)(units)(Note 13)
Date
Event
Remarks
Increase
Increase
Balance
Balance(Decrease)(Decrease)
December 1, 2015

Establishment throughprivate placement

2,000

2,000

200,000

200,000(Note 1)January 14, 2016

Capital increase throughprivate placement

95,00097,0009,500,000

9,700,000(Note 2)

April 19, 2016

Capital increase throughpublic offering

235,900

332,900

22,705,375

32,405,375(Note 3)

11,800344,700

1,135,750

33,541,125(Note 4)

66,200410,900

6,173,017

39,714,142(Note 5)

May 17, 2016
April 4, 2017

Capital increase throughthird-party allotment
Capital increase throughpublic offering

April 24, 2017

Capital increase throughthird-party allotment

3,400

414,300

317,043

40,031,185(Note 6)

February 1, 2018

Capital increase throughpublic offering

53,641

467,941

5,525,130

45,556,316(Note 7)

2,683

470,624

276,354

45,832,670(Note 8)66,857537,4816,584,077

52,416,747(Note 9)February 27, 2018
September 5, 2018

Capital increase throughthird-party allotment
Capital increase throughpublic offering

October 2, 2018

Capital increase throughthird-party allotment

3,343

540,824

329,218

52,745,966(Note 10)

August 1, 2020

Investment unit split

540,824

1,081,648-

52,745,966(Note 11)

August 1, 2020

Merger592,741

1,674,389-

52,745,966(Note 12)(Note 1) Investment units were issued at a paid-in amount of 100,000 yen per unit upon the establishment of SAR.
(Note 2) Investment units were issued at a paid-in amount of 100,000 yen per unit.
(Note 3) New investment units were issued through public offering at an issue price of 100,000 yen (paid-in amount of 96,250 yen) per unit for the
purpose of procuring funds for acquisition of new properties, etc.
(Note 4) New investment units were issued through third-party allotment at a paid-in amount of 96,250 yen per unit for the purpose of procuring funds
for repayment of borrowings.
(Note 5) New investment units were issued through public offering at an issue price of 96,720 yen (paid-in amount of 93,248 yen) per unit for the purposeof procuring funds for acquisition of new properties.
(Note 6) New investment units were issued through third-party allotment at a paid-in amount of 93,248 yen per unit for the purpose of procuring funds
for repayment of borrowings.
(Note 7) New investment units were issued through public offering at an issue price of 106,724 yen (paid-in amount of 103,002 yen) per unit for the
purpose of procuring funds for acquisition of new properties.
(Note 8) New investment units were issued through third-party allotment at a paid-in amount of 103,002 yen per unit for the purpose of procuring funds
for repayment of borrowings.
(Note 9) New investment units were issued through public offering at an issue price of 101,985 yen (paid-in amount of 98,480 yen) per unit for the
purpose of procuring funds for acquisition of new properties.
(Note 10) New investment units were issued through third-party allotment at a paid-in amount of 98,480 yen per unit for the purpose of procuring funds
for repayment of borrowings.
(Note 11) SAR has conducted an investment unit split to split one investment unit into two investment units.
(Note 12) Due to the Merger, SAR allocated and delivered 1.78 SAR investment units for every 1.0 SSR investment unit. As a result, SAR issued 592,741
new investment units.
(Note 13) Deduction of reversal of allowance for temporary difference adjustment in line with the cash distribution in excess of earnings from unitholders’capital is not considered.

－

26

－

3.

Reference Information(1) Investment Status

Type ofasset

9th fiscal period(As of July 31, 2020)
Total amount
As a percentage
heldof total assets(million yen)(%)
(Note 2)
(Note 3)

Geographic area
(Note 1)Primary use

10th fiscal period(As of January 31, 2021)
Total amount
As a percentage
heldof total assets(million yen)(%)
(Note 2)
(Note 3)

Greater Tokyo

19,38717.2

52,422

29.2

Other than Greater Tokyo

15,761

13.9

15,712

8.7

Other than Greater Tokyo--

15,2608.5

Greater Tokyo

15,85814.0

26,972

15.0

Other than Greater Tokyo

3,113

2.8

6,251

3.5

Greater Tokyo

30,69027.2

30,018

16.7

Greater Tokyo

12,78911.3

12,768

7.1

Other than Greater Tokyo

7,736

6.8

7,700

4.3

105,33793.2

167,106

92.9

Investment securities

853

0.8

756

0.4

Long-term loans receivable

300

0.3

300

0.2

Deposits and other assets

6,545

5.8

11,626

6.5

Total amount of assets

113,035

100.0

179,789

100.0

OfficeRetailRealestatein trust

Residence

Logistics facility

Hotel

Subtotal

Amount(million yen)

As a percentage
of total assets(%)

Amount(million yen)

As a percentage
of total assets(%)

Total amount of liabilities (Note 4)

58,42051.7

90,18950.2

Total amount of net assets (Note 4)

54,61448.3

89,60049.8(Note 1) ”Greater Tokyo” refers to Tokyo’s 23 wards, Yokohama City and Kawasaki City in the case of the office and retail asset
types, and Tokyo, Kanagawa, Saitama and Chiba Prefectures in the case of other asset types (residence, logistics facility
and hotel). The same shall apply hereinafter.
(Note 2) “Total amount held” is the carrying amount as at the date of settlement of accounts (in the case of real estate in trust,then the depreciated book value), rounded down to the nearest million yen.
(Note 3) “As a percentage of total assets” is the carrying amount of the concerned assets expressed as a percentage of the total
amount of assets, rounded to the first decimal place.
(Note 4) “Total amount of liabilities” and “Total amount of net assets” are according to total liabilities and total net assets on
the balance sheet.

－

27

－

(2) Investment Assets① Investment securities
Asset
no.

Name of the security

MEZ-01

Star Asia Mezzanine Loan
Debt Investment Series 1

MEZ-03

Star Asia Mezzanine Loan
Debt Investment Series 3

MEZ-05

Star Asia Mezzanine Loan
Debt Investment Series 5

TKI-01

Subordinated silent
partnership equity interest
in Godo Kaisya SAPR8

TKI-02

Silent partnership equity
interest in Godo Kaisya
SAPR7
Total

Type of asset

Book value(million yen)

Quantity(Units)Corporate
bond
Trust
beneficiaryrightsTrustbeneficiaryrightsSilentpartnership
equityinterest
Silentpartnership
equityinterest－

Fair value(million yen)

Unrealized
gain orloss(millionyen)

Remarks

Unit
price

Amount

Unit
price

－

－

400

－

400

－

(Note 1)
(Note 2)

－

－

123

－

123

－

(Note 1)
(Note 3)

－

－

150

－

150

－

(Note 1)
(Note 4)

－

－

13

13

－

(Note 5)(Note 6)

－

－

69

69

－

(Note 5)(Note 6)

－

－

756

756

－

－

－

Amount(Note 1) Because interest income etc. from mezzanine loan debt are based on floating interest rates, the fair value isapproximately the same as the book value and thus stated at that book value.
(Note 2) The underlying assets are trust beneficiary interests in a trust mainly comprised of Relief Premium Haneda.
(Note 3) The underlying assets are trust beneficiary interests in a trust mainly comprised of The Royal Garden Residence
Shirokanedai.
(Note 4) The underlying assets are trust beneficiary interests in a trust mainly composed of Sanmaison Ohorikoenkita.
(Note 5) Book value is stated as fair value.
(Note 6) Overview of operating assets are as follows. Urban Park Tokiwadai Koen and Urban Park Mitsuike Koen weretransferred to SAR during the 10th fiscal period.
Name of the security

Type of specified
asset

Subordinated silent
partnership equity interest in
Godo Kaisya SAPR8

Beneficiary interestin trust

Silent partnership equity
interest in Godo Kaisya SAPR7

Beneficiary interestin trust

Property nameUrban Park Mitsuike Koen
Urban Park Tokiwadai Koen
OHA Building

－

28

－

Location(Indication of residential address)
6-10-5 Shimosueyoshi, Tsurumi-ku,
Yokohama-shi, Kanagawa Prefecture40-1 Tokiwadai, Hodogaya-ku,
Yokohama-shi, Kanagawa Prefecture
1-22-17 Akebono-cho, Tachikawa-shi,Tokyo② Real estate(a) Overview of real estate (purchase price, etc.)
Use

Propertyno.
(Note 1)
OFC-01

Minami-Azabu Shibuya
Building

OFC-03

Honmachibashi Tower

OFC-04

Nishi-Shinjuku Matsuya
Building

OFC-06

Shibuya MK Building

OFC-08Asahi Building

OFC-09Hakata-eki East Place

OFC-10
OFC-11

OfficeProperty name

OFC-12
OFC-13

Nihonbashi Hamacho Park
Building
Amusement Media
Gakuin Honkan
Higashi-KobeCenter Building
Amusement Media
Gakuin Shinkan

OFC-14

Seishin BLDG.

OFC-15NK BLDG.

OFC-16

Tsukasamachi BLDG.

OFC-17

Takadanobaba Access

OFC-18

Azabu Amerex BLDG.

OFC-19Hiei-Kudan BLDG.

OFC-20Shin-Yokohama Nara BLDG.

OFC-21The Portal Akihabara

Location(Note 2)
Minato Ward,Tokyo
Chuo Ward,
Osaka City, Osaka
Shibuya Ward,Tokyo
Shibuya Ward,Tokyo
Kanagawa Ward,
Yokohama City,
Kanagawa
Hakata Ward,
Fukuoka City,
Fukuoka
Chuo Ward,Tokyo
Shibuya Ward,Tokyo
Higashinada Ward,
Kobe City, Hyogo
Shibuya Ward,Tokyo
Shinjuku Ward,Tokyo
Chiyoda Ward,Tokyo
Chiyoda Ward,Tokyo
Shinjuku Ward,Tokyo
Minato Ward,Tokyo
Chiyoda Ward,Tokyo
Kohoku Ward,
Yokohama City,
Kanagawa
Chiyoda Ward,Tokyo

RetailSubtotal
RTL-01

La Park Kishiwada

RTL-02

Suroy Mall Chikushino

RTL-03

Seiyu Minakuchi

Kishiwada City,
Osaka
Chikushino City,
Fukuoka
Koka City,
Shiga

Residence

Subtotal
RSC-01

Urban Park Azabujuban

RSC-02

Urban Park Daikanyama

RSC-05

Urban Park Namba

RSC-06

Urban Park Gokokuji

RSC-07

Urban Park Kashiwa

RSC-08

Urban Park Ryokuchi Koen

RSC-09Urban Park Koenji

RSC-10Urban Park Ichigao

RSC-11

Urban Park Gyotoku

RSC-12

Shiroi Logiman

RSC-13

Urban Park Sekime

Minato Ward,Tokyo
Shibuya Ward,Tokyo
Naniwa Ward,
Osaka City, Osaka
Toshima Ward,Tokyo
Kashiwa City,
Chiba
Suita City, Osaka
Suginami Ward,Tokyo
Aoba Ward,
Yokohama City,
Kanagawa
Ichikawa City,
Chiba
Shiroi City, Chiba
Joto Ward,
Osaka City, Osaka

－

29

－

Acquisition
price(million yen)
(Note 3)

Share ofinvestment(%)(Note 4)

Real estateappraisalvalue, etc.
(million yen)
(Note 5)Acquisition date

2,973

1.8

3,020

January 14, 2016

6,065

3.6

6,760

January 14, 2016

1,763

1.1

2,500

April 20, 2016

2,042

1.2

3,220

April 20, 2016

6,320

3.8

7,790

April 20, 2016

2,286

1.4

2,630

April 6, 2017

1,450

0.9

1,540

February 2, 2018

2,580

1.5

2,690

September 6, 2018

7,440

4.5

7,390

September 6, 2018

1,020

0.6

1,160

February 1, 201911,200

6.7

11,200August 1, 2020

5,350

3.2

5,360

August 1, 2020

4,590

2.8

4,590

August 1, 2020

3,990

2.4

3,970

August 1, 2020

2,780

1.7

2,790

August 1, 2020

2,400

1.4

2,370

August 1, 2020

2,300

1.4

2,310

August 1, 2020

1,510

0.9

1,510

August 1, 2020

68,05940.8

72,800

－

5,400

3.2

5,210

August 1, 2020

6,550

3.9

6,540

August 1, 2020

3,320

2.0

3,310

August 1, 2020

15,2709.2

15,060

－

2,045

1.2

2,500

January 14, 2016

6,315

3.8

8,450

January 14, 2016

1,490

0.9

1,630

April 20, 2016

1,460

0.9

1,510

February 1, 2017

1,186

0.7

1,190

April 6, 2017

1,550

0.9

1,640

February 2, 2018

1,167

0.7

1,180

February 2, 2018

1,810

1.1

1,890

March 13, 2020

1,430

0.9

1,530

March 13, 2020

2,470

1.5

2,460

August 1, 2020

2,150

1.3

2,210

August 1, 2020

Residence

Use

Propertyno.
(Note 1)

Property name

RSC-14

Urban Park Imazato

RSC-15

Urban Park Yoyogi

RSC-16

Urban Park Tokiwadai Koen

RSC-17

Urban Park Mitsuike Koen

Location(Note 2)
Ikuno Ward,
Osaka City, Osaka
Shibuya Ward,Tokyo
Hodogaya Ward,
Yokohama City,
Kanagawa
Tsurumi Ward,
Yokohama City,
Kanagawa

Logistics facility

Subtotal
Iwatsuki Ward,
Saitama City,
Saitama
Kanagawa Ward,
Yokohama City,
Kanagawa
Funabashi City,
Chiba

Share ofinvestment(%)(Note 4)

Real estateappraisalvalue, etc.
(million yen)
(Note 5)Acquisition date

993

0.6

990

August 1, 2020

1,740

1.0

1,760

August 1, 2020

3,506

2.1

3,770

October 16, 2020

3,160

1.9

3,330

January 8, 2021

32,472

19.5

36,040

－

6,942

4.2

7,310

January 14, 2016

3,560

2.1

4,120

January 14, 2016

7,875

4.7

8,660

January 14, 2016

LGC-01

Iwatsuki Logistics

LGC-02

Yokohama Logistics

LGC-03

Funabashi Logistics

LGC-04

Baraki Logistics

Ichikawa City,
Chiba

4,700

2.8

4,880

April 6, 2017

LGC-05Tokorozawa Logistics

Tokorozawa City,
Saitama

1,300

0.8

1,380

April 6, 2017

LGC-07

Funabashi Nishiura
Logistics II

Funabashi City,
Chiba

821

0.5

850

February 2, 2018

LGC-08

Matsubushi Logistics

Kitakatsushika-gun,
Saitama

2,755

1.7

2,910

February 2, 2018

LGC-09Funabashi Hi-Tech Park
Factory I

Funabashi City,
Chiba

1,710

1.0

1,710

August 1, 2020

LGC-10

Funabashi Hi-Tech Park
Factory II

Funabashi City,
Chiba

702

0.4

701

August 1, 2020

30,36518.2

32,521－

Subtotal

Hotel

Acquisition
price(million yen)
(Note 3)

HTL-01R&B Hotel Umeda East

Kita Ward,
Osaka City, Osaka

2,069

1.2

2,250

January 14, 2016

HTL-02

Smile Hotel Namba

Naniwa Ward,
Osaka City, Osaka

1,750

1.0

1,400

January 14, 2016

HTL-03

BEST WESTERN Tokyo
Nishikasai

3,827

2.3

3,610

April 6, 2017

HTL-04

BEST WESTERN Yokohama

3,248

1.9

3,190

April 6, 2017

HTL-05

Hotel WBF Fukuoka Tenjin
Minami

1,970

1.2

1,930

September 6, 2018

HTL-06

GLANSIT AKIHABARA

2,500

1.5

2,440

September 6, 2018

HTL-07

Best Western Tokyo
Nishikasai Grande

Edogawa Ward,
Tokyo

3,180

1.9

3,130

September 6, 2018

HTL-08

KOKO HOTEL Osaka Namba(Note 6)

Naniwa Ward,
Osaka City, Osaka

2,000

1.2

1,450

September 6, 2018

20,54412.3

19,400－166,710100.0

175,821－

Edogawa Ward,Tokyo
Tsurumi Ward,
Yokohama City,
Kanagawa
Chuo Ward,
Fukuoka City,
FukuokaChiyoda Ward,Tokyo

Subtotal
Total(Note 1) “Property no.” is assigned to SAR’s investment assets by categorizing into office (OFC), retail facility (RTL), residence (RSC), logistics facility(LGC) and hotel (HTL), and numbering in order by category. The same shall apply hereinafter.
(Note 2) “Location” is the smallest independent administrative district in which each investment asset is located.
(Note 3) “Acquisition price” indicates the sale and purchase price stated in the sale and purchase agreement for each investment asset. (Not including
consumption tax and local consumption tax.) However, in the case of Minami-Azabu Shibuya Building, since the price for each investment
asset among multiple assets is not set in the sale and purchase agreement, the total sale and purchase price is divided proportionally basedon the ratio of the appraisal value of the properties at the time of acquisition and indicated as the acquisition price. The receipt price isindicated for properties that were succeeded due to the absorption-type merger with SAR as the surviving corporation.
(Note 4) “Share of investment” is the acquisition price of the investment asset indicated as the ratio of the total of acquisition price, rounded to thefirst decimal place.

－

30

－

(Note 5) Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute and The Tanizawa Sogo Appraisal co., Ltd. are entrusted with appraisals. Realestate appraisal values are the figures indicated in the real estate appraisal report with January 31, 2021, as the date of value and are rounded
to the nearest million yen. For details, please refer to “(d) Summary of Real Estate Appraisal Reports, Etc.”.
(Note 6) The name has been changed as of March 1, 2021 (former property name: Hotel WBF Art Stay Namba). The same shall apply hereinafter.

(b) Portfolio Summarya.

By Geographic Area
Geographic area

GreaterTokyo

Acquisition price(million yen)

Share
(%)
(Note 1)

5 central wards of Tokyo (Note 2)

56,248

33.7

Other areas in Greater Tokyo

65,42939.2

73.0

Other than Greater Tokyo

45,033

27.0

Total

166,710100.0(Note 1) “Share” is calculated on the basis of acquisition price, rounded to the first decimal place. Accordingly, the shares
may not add up to 100%. The same shall apply hereinafter in “c. By Asset Type (Use).”(Note 2) “5 central wards of Tokyo” refers to Chiyoda, Chuo, Minato, Shinjuku and Shibuya Wards. The same shall apply
hereinafter.
(a) OfficeGeographic area
GreaterTokyo

Acquisition price(million yen)

Share
(%)

5 central wards of Tokyo

43,64864.1

Other areas in Greater Tokyo

8,620

12.7

76.8

Other than Greater Tokyo

15,791

23.2

Total

68,059100.0(b) Retail
Geographic area
GreaterTokyo

Acquisition price(million yen)

Share
(%)

5 central wards of Tokyo--

Other areas in Greater Tokyo

-

-

-

Other than Greater Tokyo

15,270

100.0

Total

15,270100.0(c) Residence
Geographic area
GreaterTokyo

Acquisition price(million yen)

Share
(%)

5 central wards of Tokyo

10,10031.1

Other areas in Greater Tokyo

16,18949.9

81.0

Other than Greater Tokyo

6,183

19.0

Total

32,472

100.0

－

31

－

(d) Logistics facility
Acquisition price(million yen)

Geographic area
GreaterTokyo

5 central wards of Tokyo

Share
(%)
-

-

30,365

100.0

100.0
Other areas in Greater Tokyo－－

30,365

100.0

Other than Greater Tokyo
Total(e) Hotel

Acquisition price(million yen)

Geographic area
GreaterTokyob.

5 central wards of Tokyo

2,500

12.2

Other areas in Greater Tokyo

10,255

49.9

62.1

Other than Greater Tokyo

7,789

37.9

Total

20,544100.0

By Size
Share(%)(Note)

Acquisition price

Number ofproperties

10 billion yen or more

1

1.9

9

17.0

40

75.5

Less than 1 billion yen

3

5.7

Total

53

100.0

5 billion yen or more
but less than 10 billion yen
1 billion yen or more
but less than 5 billion yen(Note)
c.

Share
(%)

“Share” is calculated on the basis of number of properties.

By Asset Type (Use)
Number ofproperties

Acquisition price(million yen)

Office18

68,05940.8

Retail3

15,2709.2

Residence

15

32,472

19.5

Logistics facility

930,365

18.2

Hotel

8

20,544

12.3

Total

53

166,710

100.0

Use

－

32

－

Share
(%)

(c) Status of Leasing
Operatingrevenue
Number offrom leasing
tenants(thousand(Note 1)yen)
(Note 2)

Security andguarantee
deposits(thousandyen)(Note 3)

Leased area Leasable area
(m2)
(m2)
(Note 4)(Note 5)

Occupancy
rate(%)(Note 6)

Propertyno.

Property nameConstruction
completion

OFC-01

Minami-Azabu Shibuya
Building

June 1993

5

96,477110,327

3,263.08

3,263.08

100.0

OFC-03

Honmachibashi Tower

February 2010

4
(Note 7)

239,587

166,875

8,842.07

10,489.58

84.3

OFC-04

Nishi-Shinjuku Matsuya
Building

May 198710

109,835

127,097

3,521.03

3,521.03

100.0

OFC-05Alphabet Seven (quasi coownership interest (60%))(Note 10)January 1990-

29,650----

OFC-06

Shibuya MK Building

July 1993

4

80,650126,342

1,612.88

1,612.88

100.0

OFC-08Asahi Building

November 1994

20

228,609247,764

8,672.01

8,672.01

100.0

OFC-09Hakata-eki East Place

February 1986

18

104,071

91,354

4,571.10

4,632.70

98.7

OFC-10Nihonbashi Hamacho Park
Building

July 1992

4

51,78876,945

1,911.84

1,911.84

100.0

OFC-11

Amusement Media Gakuin
HonkanNovember 1994

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)1,892.18

100.0

OFC-12

Higashi Kobe Center Building

January 1992

52

16,285.33

16,926.56

96.2

OFC-13

Amusement Media Gakuin
ShinkanJanuary 1999

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)781.33100.0

OFC-14

Seishin BLDG.

March 1989

20

244,866

335,850

5,616.79

5,616.79

100.0

OFC-15NK BLDG.

October 1991

9

138,581

136,875

3,029.91

3,394.35

89.3

OFC-16

Tsukasamachi BLDG.

January 1988

6

118,175

159,962

3,250.68

3,250.68

100.0

OFC-17

Takadanobaba Access

January 1994

9

112,805

116,150

3,691.49

3,691.49

100.0

OFC-18

Azabu Amerex BLDG.

June 1988

6

71,41065,0902,006.39

2,240.03

89.6

OFC-19Hiei-Kudan BLDG.

September 1991

9

68,63592,9892,100.58

2,298.86

91.4

OFC-20Shin-Yokohama Nara BLDG.

March 1992

16

81,80488,397

3,985.09

4,057.89

98.2

OFC-21The Portal Akihabara

May 2002

7

32,76833,284815.38941.6986.6

RTL-01

La Park Kishiwada

August 1994

52
(Note 11)

493,039

231,204

40,456.50(Note 11)40,875.15(Note 11)

99.0

RTL-02

Suroy Mall Chikushino

June 2007

24

282,075

455,184

31,344.51

32,110.04

97.6

RTL-03

Seiyu Minakuchi

May 1999

1

Not disclosed Not disclosed(Note 9)(Note 9)23,814.87

23,814.87

100.0

RTL-04

Suroy Mall Nagamine(Note 12)

August 2007-

79,299----

RSC-01

Urban Park Azabujuban

November 1999

37

52,852

10,6301,737.96

1,986.76

87.5

Urban Park Daikanyama

Existing:
November 1982
Newly built:
May 2006

66

193,136

77,126

5,726.88

5,977.18

95.8

RSC-02－

33

320,536－

301,494

Property
no.

Property nameOperatingrevenue
Number offrom leasing
tenants(thousand(Note 1)yen)
(Note 2)

Construction
completion

Security andguarantee
deposits(thousandyen)(Note 3)

Leased area Leasable area
(m2)
(m2)
(Note 4)(Note 5)

Occupancy
rate(%)(Note 6)

RSC-05

Urban Park Namba

January 201397

44,779-2,158.33

2,584.81

83.5

RSC-06

Urban Park Gokokuji

February 1990

95

42,974

7,038

1,623.08

1,964.04

82.6

RSC-07

Urban Park Kashiwa

August 1997

38

35,164

7,734

2,814.91

2,954.77

95.3

RSC-08

Urban Park Ryokuchi Koen

March 1989

55

57,6599,390

5,103.14

5,508.94

92.6

RSC-09Urban Park Koenji

October 1987

64

34,526

5,262

1,139.18

1,365.48

83.4

RSC-10Urban Park Ichigao

July 1998

57

54,803

15,863

3,946.86

4,322.62

91.3

RSC-11

Urban Park Gyotoku

March 1995

40

46,30329,0432,859.48

2,976.36

96.1

RSC-12

Shiroi Logiman

May 1995

293

140,832

14,523

21,577.09

21,934.07

98.4

RSC-13

Urban Park Sekime

August 1989

123

84,7639,929

7,324.31

7,684.17

95.3

RSC-14

Urban Park Imazato

December 1991

65

39,2681,887

4,456.54

4,648.64

95.9

RSC-15

Urban Park Yoyogi

September 201726

42,267

7,942

1,211.83

1,286.50

94.2

RSC-16

Urban Park Tokiwadai Koen

February 1994

136

82,51730,242

13,992.00

14,058.00

99.5

RSC-17

Urban Park Mitsuike Koen

March 1992

137

16,38425,793

10,098.00

10,362.00

97.5

LGC-01

Iwatsuki Logistics

October 2014

3

198,172

97,01430,190.81

30,190.81

100.0

LGC-02

Yokohama Logistics

October 1994

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)18,142.08

100.0

LGC-03

Funabashi Logistics

Building 1:
September 1992
Building 2:
August 1997

4

34,901.67

38,086.56

91.6

LGC-04

Baraki Logistics

August 20152

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)12,126.28

100.0

LGC-05Tokorozawa Logistics

April 1999

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)5,994.75

100.0

LGC-06

Funabashi Nishiura Logistics I(Note 13)

October 1985-

Not disclosed(Note 9)---LGC-07

Funabashi Nishiura Logistics II

Warehouse: March
1991
Factory: May 1972
Office: May 19861

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)6,315.87

100.0

LGC-08

Matsubushi Logistics

March 19971

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)19,833.47

100.0

LGC-09Funabashi Hi-Tech Park
Factory I

May 2003

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)8,340.98

100.0

LGC-10

Funabashi Hi-Tech Park
Factory II

September 2001

1

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)4,233.92

100.0

HTL-01R&B Hotel Umeda East

October 2000

1

65,36273,4953,940.93

3,940.93

100.0

HTL-02

Smile Hotel Namba

February 2008

1

22,374-

1,711.42

1,711.42

100.0

－

34

259,851－

83,426-

Operating
revenue
Number offrom leasing
tenants(thousand(Note 1)yen)
(Note 2)

Security andguarantee
deposits(thousandyen)(Note 3)

Leased area Leasable area
(m2)
(m2)
(Note 4)(Note 5)

Occupancy
rate(%)(Note 6)

Propertyno.

Property nameConstruction
completion

HTL-03

BEST WESTERN Tokyo
Nishikasai

March 1991

1

85,59584,6005,293.88

5,293.88

100.0

HTL-04

BEST WESTERN Yokohama

September 1987

1

80,94580,4004,686.09

4,686.09

100.0

HTL-05

Hotel WBF Fukuoka Tenjin
MinamiFebruary 20171

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)2,281.49

100.0

HTL-06

GLANSIT AKIHABARA

September 20171

Not disclosed Not disclosed Not disclosed(Note 9)(Note 9)(Note 9)1,089.06

100.0

HTL-07

BEST WESTERN Tokyo
Nishikasai Grande

February 2017

1

2,755.19

2,755.19

100.0

HTL-08

KOKO HOTEL Osaka Namba

April 2017

0(Note 14)0.00

2,061.46

0.0

419,072.52

432,693.61

96.9

Total

(Note 1)

1,629

70,825

116,670--5,648,622

5,203,164“Number of tenants” is the number of tenants (excluding parking) under the lease agreement stated in the leaseagreement for each investment asset as of January 31, 2021. If a single tenant is leasing multiple rental units in an
investment asset, the tenant is counted as 1 tenant for the concerned investment asset. If a single tenant is leasing
rental units across multiple investment assets, the tenant is counted as separate tenants and the sum total numberof tenants is stated in the total column. Furthermore, in cases where a pass-through-type master lease agreement
under which rent from end-tenants is received in principle (“pass-through-type master lease”) has been concluded
for the concerned investment asset, the total number of end-tenants is stated. In cases where a master leaseagreement agreeing to the effect that the rent under the master lease agreement shall be a fixed rent (“rentguaranteed type master lease”) has been concluded for the concerned investment asset, the number of tenants is
1 and the sum total of these is stated.

(Note 2)

(Note 3)

“Operating revenue from leasing” is rental revenue, common area maintenance revenue, parking revenue andother revenue generated from real estate held during the fiscal period under review (including other lease businessrevenue).
“Security and guarantee deposits” is the sum total amount of tenant security and guarantee deposits required
based on the lease agreement (including deposits based on parking, antenna, rooftop and other agreements; theamount after depreciation) for each investment asset as of January 31, 2021 (limited to those occupied as of saiddate). Furthermore, in cases where a pass-through-type master lease agreement has been concluded for theconcerned investment asset, it is the sum total amount of tenant security and guarantee deposits under lease(Note 4)agreements concluded with end-tenants.
“Leased area” is the sum total of the leased area stated in the lease agreement for each investment asset as ofJanuary 31, 2021. Furthermore, in cases where a master lease agreement has been concluded for the concerned
investment asset, it is the sum total of the leased area under lease agreements concluded with end-tenants forproperties under a pass-through-type master lease, and it is the leased area under the master lease agreement for
properties under a rent-guaranteed type master lease.

(Note 5)

“Leasable area” is the floor area regarded as being available for leasing based on the lease agreement or building
drawing, etc. of the building for each investment asset as of January 31, 2021.

(Note 6)

“Occupancy rate” is the ratio of leased area to leasable area for each investment asset as of January 31, 2021,
rounded to the first decimal place. In addition, in the total column, it is the ratio of the sum total of leased area to(Note 7)the sum total of leasable area for each investment asset, rounded to the first decimal place.
Of the tenants of the property, a single company leases all 36 units of the residential portion, of which 30 units areunder a rent-guaranteed type master lease agreement and 6 units are under a pass-through-type master leaseagreement.

(Note 8)(Note 9)In the table, “Number of tenants,” “Security and guarantee deposits,” “Leased area” and “Occupancy rate” arebased on lease agreements valid as of January 31, 2021, even if there is a notice of cancellation or termination oflease agreements with end-tenants or unpaid rent.
Not disclosed, because consent for disclosure has not been obtained from the tenants.

(Note 10) Alphabet Seven (60% quasi co-ownership interest) was transferred on December 1, 2020. The same shall apply
－

35

－

hereinafter.
(Note 11) The number of tenants and each area related to the installation of ATM are not included.
(Note 12) Suroy Mall Nagamine was transferred on October 15, 2020. The same shall apply hereinafter.
(Note 13) Funabashi Nishiura Logistics I was transferred on December 23, 2020. The same shall apply hereinafter.
(Note 14) SAR has concluded a lease agreement with Fino Hotels Co., Ltd. as of February 26, 2021, and is leasing the entire
property from March 1, 2021.
(d) Summary of Real Estate Appraisal Reports, Etc.
Summary of appraisal reports

Use

OfficePropertyno.

Property nameAppraisal
Appraisal
value
firm
(million yen)
(Note 1)
(Note 2)

Income approach
Direct capitalization
methodDCF
methodIndicatedvalue(million yen)

Cap rate(%)

Indicated Discount
value
rate
(million yen)(%)

Appraisal
NOI yield
NOI(%)(million yen)
(Note 4)
Terminal(Note 3)cap rate(%)

OFC-01

Minami-Azabu Shibuya Building

Daiwa

3,020

3,140

3.9

2,970

3.5

4.1

140

4.7

OFC-03

Honmachibashi Tower

Daiwa

6,760

6,900

4.2

6,700

4.0

4.4

308

5.1

OFC-04

Nishi-Shinjuku Matsuya Building

Daiwa

2,500

2,470

4.1

2,510

3.9

4.3

116

6.6

OFC-06

Shibuya MK Building

JREI

3,220

3,290

3.5

3,150

3.3

3.7

119

5.8

OFC-08Asahi Building

JREI

7,790

7,930

3.6

7,650

3.4

3.8

317

5.0

OFC-09Hakata-eki East Place

Daiwa

2,630

2,580

4.6

2,650

4.4

4.8

120

5.2

OFC-10Nihonbashi Hamacho Park Building Daiwa

1,540

1,530

4.3

1,540

4.1

4.5

68

4.7

OFC-11

Amusement Media Gakuin
Honkan

Daiwa

2,690

2,750

3.6

2,670

3.4

3.8

103

4.0

OFC-12

Higashi Kobe Center Building

Tanizawa

7,390

7,540

5.0

7,330

5.1

5.2

425

5.7

OFC-13

Amusement Media Gakuin
Shinkan

JREI

1,160

1,180

3.4

1,130

3.2

3.6

41

4.1

OFC-14

Seishin BLDG.

JREI

11,20011,5003.5

10,900

3.2

3.6

410

3.7

OFC-15NK BLDG.

Tanizawa

5,360

5,560

3.5

5,270

3.6

3.7

205

3.8

OFC-16

Tsukasamachi BLDG.

Tanizawa

4,590

4,760

3.6

4,510

3.7

3.8

178

3.9

OFC-17

Takadanobaba Access

Tanizawa

3,970

4,220

3.7

3,860

3.8

3.9

162

4.1

OFC-18

Azabu Amerex BLDG.

JREI

2,790

2,820

3.6

2,750

3.3

3.7

106

3.8

OFC-19Hiei-Kudan BLDG.

Tanizawa

2,370

2,530

3.5

2,300

3.6

3.7

96

4.0

OFC-20Shin-Yokohama Nara BLDG.

JREI

2,310

2,320

4.5

2,290

4.2

4.6

110

4.8

OFC-21The Portal Akihabara

Tanizawa

1,510

1,570

3.7

1,480

3.8

3.9

60

4.0

72,80074,590-71,660

-

-

3,084

4.5

JREI

5,210

5,230

6.4

5,190

6.2

6.6

385

7.1

Tanizawa

6,540

6,510

5.7

6,550

5.8

5.9

382

5.8

JREI

3,310

3,340

6.7

3,280

6.5

7.0

245

7.4

15,06015,080-15,020

-

-

1,012

6.6

Subtotal
RTL-01

La Park Kishiwada

RTL-02

Suroy Mall Chikushino

RTL-03

Seiyu Minakuchi

RetailSubtotal－36－

Summary of appraisal reports

Use

Residence

Propertyno.

Property nameAppraisal
Appraisal
value
firm
(million yen)
(Note 1)
(Note 2)

DCF
methodIndicatedvalue(million yen)

Cap rate(%)

Indicated Discount
value
rate
(million yen)(%)

Appraisal
NOI yield
NOI(%)(million yen)
(Note 4)
Terminal(Note 3)cap rate
(%)

2,500

2,550

3.4

2,450

3.2

3.6

90

4.4

Urban Park Daikanyama

JREI

8,450

8,630

3.3

8,260

3.1

3.5

300

4.7

Urban Park Namba

Daiwa

1,630

1,660

4.7

1,620

4.5

4.9

80

5.4

RSC-06

Urban Park Gokokuji

JREI

1,510

1,540

3.9

1,480

3.7

4.1

68

4.6

RSC-07

Urban Park Kashiwa

Tanizawa

1,190

1,220

4.6

1,180

4.7

4.8

60

5.0

RSC-08

Urban Park Ryokuchi Koen

Tanizawa

1,640

1,660

4.7

1,630

4.8

4.9

88

5.7

RSC-09Urban Park Koenji

Tanizawa

1,180

1,200

4.0

1,170

4.1

4.2

55

4.7

RSC-10Urban Park Ichigao

JREI

1,890

1,920

4.2

1,860

4.0

4.4

86

4.8

RSC-11

Urban Park Gyotoku

Tanizawa

1,530

1,550

4.1

1,520

4.2

4.3

67

4.7

RSC-12

Shiroi Logiman

Tanizawa

2,460

2,440

5.1

2,470

5.2

5.3

141

5.7

RSC-13

Urban Park Sekime

Tanizawa

2,210

2,240

4.6

2,200

4.7

4.8

113

5.3

RSC-14

Urban Park Imazato

Tanizawa

990

1,000

4.8

986

4.9

5.0

53

5.4

RSC-15

Urban Park Yoyogi

JREI

1,760

1,790

3.6

1,730

3.3

3.8

65

3.7

RSC-16

Urban Park Tokiwadai Koen

Tanizawa

3,770

3,830

4.6

3,740

4.7

4.8

196

5.6

RSC-17

Urban Park Mitsuike Koen

Tanizawa

3,330

3,380

4.8

3,310

4.9

5.0

175

5.5

36,04036,610-35,606

-

-

1,637

5.0

Urban Park Azabujuban

RSC-02
RSC-05

LGC-01

Iwatsuki Logistics

Daiwa

7,310

7,410

4.4

7,270

4.2

4.6

333

4.8

LGC-02

Yokohama Logistics

Daiwa

4,120

4,160

4.2

4,100

4.0

4.4

204

5.7

LGC-03

Funabashi Logistics

Daiwa

8,660

8,760

4.2

8,620

4.0

4.4

416

5.3

LGC-04

Baraki Logistics

Tanizawa

4,880

4,990

3.9

4,830

3.8

4.1

196

4.2

LGC-05Tokorozawa Logistics

JREI

1,380

1,390

4.9

1,360

4.5

5.2

74

5.7

LGC-07

Funabashi Nishiura Logistics II

Daiwa

850

848

5.6

851

5.4

5.8

58

7.0

LGC-08

Matsubushi Logistics

JREI

2,910

2,930

5.0

2,880

4.5

5.3

151

5.5

LGC-09Funabashi Hi-Tech Park Factory I

JREI

1,710

1,730

6.4

1,680

6.3

6.7

111

6.5

LGC-10

Funabashi Hi-Tech Park Factory II

JREISubtotal

Hotel

Direct capitalization
method

JREI

RSC-01

Subtotal

Logistics
facility

Income approach

701

707

6.2

694

5.4

7.0

48

6.8

32,521

32,925-32,285

-

-

1,591

5.2

112

5.4

HTL-01R&B Hotel Umeda East

Daiwa

2,250

2,260

4.6

2,240

4.4

4.8

HTL-02

Smile Hotel Namba

Daiwa

1,400

1,470

4.7

1,370

4.5

4.9

75

4.3

HTL-03

BEST WESTERN Tokyo Nishikasai

JREI

3,610

3,680

4.3

3,540

4.1

4.5

163

4.3

HTL-04

BEST WESTERN Yokohama

JREI

3,190

3,240

4.4

3,140

4.2

4.6

146

4.5

HTL-05

Hotel WBF Fukuoka Tenjin Minami

Tanizawa

1,930

1,960

4.4

1,920

4.4

4.6

87

4.4

HTL-06

GLANSIT AKIHABARA

Tanizawa

2,440

2,510

3.9

2,410

3.8

4.1

98

3.9

HTL-07

Best Western Tokyo Nishikasai
GrandeTanizawa

3,130

3,160

4.0

3,120

3.9

4.2

126

4.0

HTL-08

KOKO HOTEL Osaka Namba

Daiwa

1,450

1,510

4.5

1,430

4.1

4.5

74

3.7

19,40019,790-19,170

-

-

881

4.3

175,821

178,995-

173,741

-

-

8,205

4.9

Subtotal
Total(Note 1) Under “Appraisal firm,” “Daiwa,” “JREI,” and “Tanizawa” stand for Daiwa Real Estate Appraisal Co., Ltd., Japan Real
Estate Institute, and The Tanizawa Sogo Appraisal co., Ltd., respectively(Note 2) “Appraisal value” is as of January 31, 2021, as the date of value.
(Note 3) “NOI” is net operating income calculated under the direct capitalization method stated in the appraisal report,
rounded to the nearest million yen.
(Note 4) “Appraisal NOI yield” is based on net operating income calculated under the direct capitalization method stated in
the appraisal report and expressed as a percentage of acquisition price, rounded to the first decimal place.

－

37

－

(e) Information on Major Real Estate Properties
Of investment assets, there is no property that falls under the category of major real estate properties (buildings/facilities
pertaining to land recognized to be used collectively, of which total rental revenue accounts for 10% or more of the sum totalof total rental revenue of investment assets) as of January 31, 2021. Of investment assets, the following are top five properties
in terms of total rental revenue as of January 31, 2021.
Changes in occupancy rate (%) (Note)
January 31, 2019
July 31, 2019
January 31, 2020
July 31, 2020
January 31, 2021
La Park Kishiwada(Note 2)

-

-

-

-

99.0

Suroy Mall Chikushino(Note 2)

-

-

-

-

97.6

Higashi Kobe Center
Building

96.1

89.6

94.4

96.3

96.2

Funabashi Logistics

91.6

91.6

91.6

91.6

91.6

-

-

-

-

100.0

Seishin BLDG.
(Note 2)

(Note1) “Changes in occupancy rate” is the ratio of leased area to leasable area for each investment asset as of the record
date, rounded to the first decimal place.
(Note2) Succeeded properties from SSR due to the absorption-type merger with SAR as the surviving corporation.
(f) Top 10 End-Tenants in Terms of Leased Area
The following table lists the tenants ranking in the top ten tenants in terms of leased area of investment assets.
As a percentage ofLeased area
total leasable area
Name of tenant
Name of property occupied(m2)(%)(Note 1)
(Note 2)
1

Not disclosed (Note 3)

Iwatsuki Logistics

Not disclosed (Note 3)

6.9

2

Seiyu GK

Seiyu Minakuchi

23,814.87

5.5

3

Not disclosed (Note 3)

Funabashi Logistics

Not disclosed (Note 3)

5.0

4Tokyo Nohin Daiko

Matsubushi Logistics

19,833.47

4.6

5

Not disclosed (Note 3)

Yokohama Logistics

Not disclosed (Note 3)

4.2

6

Nagasakiya Co., Ltd.

15,429.00

3.6

7

Rembrandt Inn

12,735.16

2.9

8

Not disclosed (Note 3)

Funabashi Hi-Tech Park Factory I

Not disclosed (Note 3)

1.9

9

Mr Max Holdings Ltd.

Suroy Mall Chikushino

7,997.08

1.8

10

Sakoda Co., Ltd.

Suroy Mall Chikushino

Not disclosed (Note 3)

1.8

165,500.91

38.2

La Park Kishiwada
Shiroi Logiman
BEST WESTERN Tokyo Nishikasai
BEST WESTERN Yokohama
Best Western Tokyo Nishikasai
GrandeTotal of the top 10 tenants(Note 1) “Leased area” is the sum total of the leased area stated in the lease agreement for each investment asset as ofJanuary 31, 2021.
(Note 2) “As a percentage of total leasable area” is the area leased to the tenant expressed as a percentage of the sum
total of leasable area of all investment assets, rounded to the first decimal place.
(Note 3) Not disclosed, because consent for disclosure has not been obtained from the end-tenants, etc.

－

38

－

(g) Capital Expendituresa.

Schedule of Capital Expenditures for the 11th fiscal period
The following are the principal capital expenditures arising from renovation construction works, etc. currently planned
for the assets held by SAR as of January 31, 2021. Please note that the expected construction amounts include portions
that are expensed as a separate account item of accounting costs.

Name of real estate, etc.
(Location)

Scheduled period

From: Jul. 2021
To:
Jul. 2021

54,000－－

From: Jul. 2021
To:
Jul. 2021

52,500－－

Seishin BLDG.
(Shinjuku Ward, Tokyo)

Air conditioning
equipment renewal work
(2F and 3F)
Air conditioning
equipment renewal work
(2F and 3F)

Minami-Azabu Shibuya Building(Minato Ward, Tokyo)

Renewal work of common
area on 4F and 5F

From: Apr. 2021
To:
Apr. 2021

22,000－－Urban Park Sekime(Osaka City, Osaka)

Large-scale renovation
work

From: Jul. 2021
To:
Jul. 2021

21,000－－

Tsukasamachi BLDG.
(Chiyoda Ward, Tokyo)

Air conditioning
equipment renewal work
(1F, 7F and 8F)

From: Jul. 2021
To:
Jul. 2021

17,300－－Shin-Yokohama Nara BLDG.
(Yokohama City, Kanagawa)b.

PurposeEstimated construction costs(thousand yen)Amount of Total
Total
payment amountamountduringalready
periodpaid

Capital Expenditures during the 10th fiscal period
The following summarizes the primary construction works that constitute capital expenditures implemented for theassets held by SAR as of January 31, 2021, during the 10th fiscal period. Capital expenditures for the 10th fiscal periodamounted to 331,900 thousand yen and, when combined with the 181,948 thousand yen in repair expenses charged
to the same period, it totals 513,849 thousand yen in construction works implemented.
Name of real estate, etc.
(Location)
Asahi Building(Yokohama City, Kanagawa)NK BLDG.
(Chiyoda Ward, Tokyo)
Urban Park Sekime(Osaka City, Osaka)Purpose

PeriodAir conditioning
equipment renewal work

From: Jan. 2021
To:
Jan. 2021
From: Nov. 2020To:
Nov. 2020
From: Aug. 2020
To:
Sep. 2020

Renewal of 2 elevators
Repair work of outer wallof parking tower

Construction costs(thousand yen)
23,113
22,624
19,977

Higashi Kobe Center Building(Kobe City, Hyogo)

Outer wall tile repair work

From: Nov. 2020
To:
Jan. 2021

16,676

La Park Kishiwada(Kishiwada City, Osaka)

Exterior wall painting
repair work

From: Nov. 2020
To:
Dec. 2020

15,283－

234,225－

OthersTotal－

331,90039－

(h) Individual Property Income Statements(Unit: thousand yen)

Property no.

OFC-01

OFC-03

OFC-04

OFC-05

OFC-06

Property nameMinami-Azabu
Shibuya Building

Honmachibashi
Tower

Nishi-Shinjuku
Matsuya Building

Alphabet
Seven

Shibuya
MK Building① Total operating revenue
from real estate leasing

96,477

239,587

109,835

29,65080,650

Lease business revenue

88,052

184,096

101,689

27,39475,382Other lease business revenue

8,424

55,490

8,145

2,255

5,267

26,23996,86235,2308,896

17,672

5,901

14,020

6,921

1,883

4,861

400

400

400

222

350

5,863

19,254

7,475

1,979

3,132

② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium

120

370

133

45

46

Repair expenses

1,325

31,880

4,746

1,504

1,618

Property taxes

4,532

19,763

3,410

3,080

4,327

Others

8,095

11,173

12,142

180

3,334

70,237

142,725

74,60420,75462,978④ Depreciation

11,60945,404

9,803

2,819

3,530

⑤ Operating income (loss)
from real estate leasing(③－④)

58,62897,32064,801

17,93459,447

③ NOI

(①－②)

⑥ Capital expenditures

4,130

2,312

6,922

1,146

3,977

⑦ NCF

66,107140,41267,682

19,60759,001

2,944,540

5,772,954

1,825,844-

2,093,043

OFC-08

OFC-09OFC-10

OFC-11

OFC-12

Hakata-eki
East Place

Nihonbashi
Hamacho Park
Building

Amusement
Media Gakuin
HonkanHigashi Kobe
Center Building(③－⑥)

Book value at end of the period

Property no.
Property name

Asahi
Building① Total operating revenue
from real estate leasing

228,609

104,071

51,788

320,536

Lease business revenue

211,188

92,77551,788288,866

Other lease business revenue

17,421

11,296-

31,66962,90826,94012,107110,222

15,9798,174

880

25,592

400

400

400

400

16,672

7,687

-

371

173

129

Repair expenses

11,442

1,993-

Property taxes

16,123

7,079

4,299

29,165

Others

1,917

1,431

6,398

17,562② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium

29,968Not disclosed(Note)

689
6,844

165,701

77,13039,680210,314④ Depreciation

27,493

8,033

2,837

33,524⑤ Operating income (loss)
from real estate leasing(③－④)

138,207

69,097

36,843

176,790⑥ Capital expenditures

24,97012,418-22,746

⑦ NCF

(③－⑥)

140,730

64,712

39,680187,567

Book value at end of the period

6,325,224

2,319,212

1,453,120

③ NOI

(①－②)

(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

40

－

2,592,439

7,620,273

(Unit: thousand yen)

Property no.

OFC-13

OFC-14OFC-15

OFC-16

OFC-17

Property nameAmusement
Media Gakuin
ShinkanSeishin BLDG.

NK BLDG.

Tsukasamachi
BLDG.

Takadanobaba
Access

① Total operating revenue
from real estate leasing

244,866

138,581

118,175

112,805

Lease business revenue

228,262

124,989

110,309

102,023

Other lease business revenue

16,604

13,591

7,866

10,782

61,28033,71725,30730,787

19,37011,735

9,722

13,160

353

353

403

403

8,923

4,233

4,888

6,392

② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses

206

149

144

158

7,260

3,588

2,325

619

Insurance premium
Repair expenses

Not disclosed(Note)

20,92010,648

7,437

9,183

Others

4,246

3,008

385

869

③ NOI
(①－②)

183,585

104,864

92,86782,017④ Depreciation

11,715

8,297

7,399

8,810

⑤ Operating income (loss)
from real estate leasing(③－④)

171,870

96,56685,46873,207⑥ Capital expenditures

26,511

25,437

467

5,230

⑦ NCF
(③－⑥)

157,073

79,426

92,40076,7871,040,196

11,214,796

5,367,139

4,583,068

3,986,419

Property no.

OFC-18OFC-19OFC-20

OFC-21

RTL-01

Property name

Azabu Amerex
BLDG.

Hiei-Kudan
BLDG.

Shin-Yokohama Nara
BLDG.

The Portal
Akihabara

La Park Kishiwada

Property taxes

Book value at end of the period① Total operating revenue
from real estate leasing

71,41068,63581,80432,768493,039

Lease business revenue

68,444

68,63571,58031,160416,499

Other lease business revenue

2,966

-

10,223

1,607

76,54018,654

22,63829,867

6,821

287,961

7,250
377
2,268
75
787
7,669
224

3,429
503
56
133
1,488
6,814
10,212

8,834
353
4,831
136
5,901
7,765
2,043

2,736
402
1,389
29
547
1,609
106

120,640
1,861
99,507853
6,977
44,742
13,37852,75545,996

51,93625,947205,078④ Depreciation

3,307

3,643

7,902

3,472

23,983⑤ Operating income (loss)
from real estate leasing(③－④)

49,44842,352

44,03322,474

181,094⑥ Capital expenditures

2,264

3,543

18,763-40,815

⑦ NCF
(③－⑥)

50,49142,452

33,17325,947

164,2632,778,957

2,399,900

2,310,860

1,506,527

5,416,831② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium
Repair expenses
Property taxes
Others③ NOI(①－②)

Book value at end of the period(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

41

－

(Unit: thousand yen)

Property no.

RTL-02

RTL-03

RTL-04

RSC-01

RSC-02

Property nameSuroy Mall
Chikushino

Seiyu
Minakuchi

Suroy Mall
Nagamine

Urban Park
Azabujuban

Urban Park
Daikanyama① Total operating revenue
from real estate leasing

282,075

79,29952,852

193,136

Lease business revenue

279,962

62,84851,158

180,773

2,112

16,4501,694

12,36365,896

26,387

16,76039,457

22,949

4,578

2,086

9,028

353

146

350

350

Utilities expenses

4,597

12,474634

3,726

Insurance premium442

Repair expenses

832

Other lease business revenue② Total operating expenses
from real estate leasing
Management fee
Trust fee

Not disclosed(Note)

96

59

202

275

7,997

6,823

Property taxes

19,627

7,531

2,874

11,442Others

17,092

1,285

2,757

7,884

③ NOI
(①－②)

216,178

52,91136,091

153,679④ Depreciation

23,534

6,166

5,010

13,306⑤ Operating income (loss)
from real estate leasing(③－④)

192,644

46,74531,081

140,372⑥ Capital expenditures

6,612

-

2,443

8,237

209,566

52,91133,648145,441-

2,080,199

6,373,859

⑦ NCF
(③－⑥)

6,533,078

3,311,053

Property no.

RSC-05

RSC-06

RSC-07

RSC-08

RSC-09Property nameUrban Park
Namba

Urban Park
GokokujiUrban Park
Kashiwa

Urban Park
Ryokuchi Koen

Urban Park
KoenjiBook value at end of the period① Total operating revenue
from real estate leasing

44,77942,97435,16457,65934,526

Lease business revenue

44,08541,22634,12855,51931,527

693

1,747

1,035

2,139

2,998

9,113

18,08913,49013,843

11,986

2,499
350
341
66
1,780
2,820
1,254

3,678
400
2,124
54
4,321
1,909
5,600

1,824
350
533
88
6,276
2,950
1,467

2,289
350
2,578
124
3,518
3,583
1,399

2,416
400
1,344
38
5,924
969
893

35,66624,884

21,67343,81522,539④ Depreciation

7,547

5,690

7,385

8,083

2,769

⑤ Operating income (loss)
from real estate leasing(③－④)

28,11819,194

14,28735,731

19,770⑥ Capital expenditures

1,014

-

7,306

2,031

1,097

⑦ NCF
(③－⑥)

34,651

24,884

14,366

41,784

21,441

1,499,242

1,506,434

1,241,490

1,601,879

1,192,775

Other lease business revenue② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium
Repair expenses
Property taxes
Others③ NOI(①－②)

Book value at end of the period(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

42

－

(Unit: thousand yen)

Property no.

RSC-10

RSC-11

RSC-12

RSC-13

RSC-14

Property nameUrban Park
Ichigao

Urban Park
Gyotoku

Shiroi
LogimanUrban Park
SekimeUrban Park
Imazato① Total operating revenue
from real estate leasing

54,80346,303140,832

84,76339,268

Lease business revenue

52,931

43,071

133,951

82,38139,008Other lease business revenue

1,872

3,231

6,880

2,381

259

8,584

6,831

59,14332,566

10,501

2,966

2,096

5,913

10,077

4,071

400

400

756

377

377

1,419

1,549

2

1,973

277

② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium

111

73

580

200

102

Repair expenses

2,894

1,381

11,397

12,481

1,909

-

-

13,980

5,452

3,294

792

1,331

26,514

2,003

468

③ NOI
(①－②)

46,21839,471

81,68952,19628,766④ Depreciation

5,431

4,196

19,066

11,112

5,183⑤ Operating income (loss)
from real estate leasing(③－④)

40,78735,27562,622

41,084

23,583--228

24,042-

46,21839,471

81,46028,15428,766

1,925,466

1,513,491

2,451,162

2,162,929

987,816

Property no.

RSC-15

RSC-16

RSC-17

LGC-01

LGC-02

Property nameUrban Park
Yoyogi

Urban Park
Tokiwadai Koen

Urban Park
Mitsuike Koen

Iwatsuki
Logistics

Yokohama
Logistics

Property taxes
Others⑥ Capital expenditures
⑦ NCF
(③－⑥)
Book value at end of the period① Total operating revenue
from real estate leasing

42,26782,517

16,384

198,172

Lease business revenue

40,816

79,60915,351

187,718

Other lease business revenue

1,451

2,908

1,033

10,454

6,658

12,8292,897

31,159

2,189
402
183
36
582
1,791
1,473

6,406
236
817
144
1,608
45
3,570

1,626
52
52
34
80
40
1,012

5,920
350
10,454284
382
13,629137

35,60869,68813,486167,012④ Depreciation

4,393

8,416

1,951

46,731⑤ Operating income (loss)
from real estate leasing(③－④)

31,21561,271

11,535120,280

-

-

-

2,263

35,60869,68813,486

164,748

1,735,606

3,648,190

3,304,112

6,561,177② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium
Repair expenses
Property taxes
Others
③ NOI(①－②)⑥ Capital expenditures
⑦ NCF
(③－⑥)
Book value at end of the period(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

43

－

Not disclosed(Note)

3,734,157

(Unit: thousand yen)
Property no.

LGC-03

LGC-04

LGC-05

LGC-06

LGC-07

Property name

Funabashi
Logistics

Baraki
Logistics

Tokorozawa
Logistics

Funabashi Nishiura
Logistics I

Funabashi Nishiura
Logistics II

Not disclosed(Note)

Not disclosed(Note)

Not disclosed(Note)

Not disclosed(Note)① Total operating revenue
from real estate leasing

259,851

Lease business revenue

241,854

Other lease business revenue

17,997② Total operating expenses
from real estate leasing
Management fee

54,002
12,508400

Trust fee
Utilities expenses

14,521

Insurance premium

409

Repair expenses

2,929

Property taxes

23,014
217

Other
③ NOI

(①－②)

205,849④ Depreciation

27,146⑤ Operating income (loss)
from real estate leasing(③－④)

178,703⑥ Capital expenditures

4,067

(③－⑥)

201,782

Book value at end of the period

7,765,437⑦ NCF

4,628,965

1,361,933-

853,763

Property no.

LGC-08

LGC-09

LGC-10

HTL-01

HTL-02

Property name

Matsubushi
Logistics

Funabashi Hi-Tech
Park Factory I

Funabashi Hi-Tech
Park Factory II

R&B Hotel Umeda
East

Smile HotelNamba① Total operating revenue
from real estate leasing

65,362

22,374

Lease business revenue

65,362

22,374

-

-

9,228

4,130

Management fee

742

660

Trust fee

350

550

1

-

Other lease business revenue② Total operating expenses
from real estate leasing

Utilities expenses
Insurance premium
Repair expenses

Not disclosed(Note)

Not disclosed(Note)

Not disclosed(Note)

Property taxes
Other

117

55

2,313

514

5,452

2,276

249

73

56,134

18,243④ Depreciation

9,949

12,233⑤ Operating income (loss)
from real estate leasing(③－④)

46,185

6,010

③ NOI

(①－②)

⑥ Capital expenditures

3,481

-

⑦ NCF

52,653

18,243

2,108,402

1,663,146(③－⑥)

Book value at end of the period

2,709,574

1,704,262

699,405(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

44

－

(Unit: thousand yen)
Property no.

HTL-03

HTL-04

HTL-05

HTL-06

HTL-07

Property nameBEST WESTERNTokyo Nishikasai

BEST WESTERN
Yokohama

Hotel WBF Fukuoka
Tenjin Minami

GLANSITAKIHABARABest Western Tokyo
Nishikasai Grande① Total operating revenue
from real estate leasing

85,59580,94570,825

Lease business revenue

84,60080,40070,002

995

545

823

11,941

6,693

6,738

1,200

1,200

990

400

400

400
-

Other lease business revenue② Total operating expenses
from real estate leasing
Management fee
Trust fee--

Insurance premium

130

110

Repair expenses

1,281

236

Property taxes

8,019

4,705

5,239

909

41

41

Utilities expenses

Other

Not disclosed(Note)

Not disclosed(Note)

67-

73,65374,25264,087④ Depreciation

12,506

13,06910,857⑤ Operating income (loss)
from real estate leasing(③－④)

61,146

61,18353,230⑥ Capital expenditures

19,951

-

-

⑦ NCF

53,702

74,25264,087

3,867,247

3,247,472

③ NOI

(①－②)

(③－⑥)

Book value at end of the period

Property no.

HTL-08Property name

KOKO HOTEL Osaka
Namba① Total operating revenue
from real estate leasing-

Lease business revenue-

Other lease business revenue-② Total operating expenses
from real estate leasing
Management fee

5,137
1,214

Trust fee

350

Utilities expenses

43

Insurance premium

48

Repair expenses-

Property taxes

3,153
327

Other
③ NOI

(①－②)

④ Depreciation(5,137)
9,035⑤ Operating income (loss)
from real estate leasing(③－④)(14,173)⑥ Capital expenditures

114

⑦ NCF

1,948,273(③－⑥)

Book value at end of the period(5,252)
1,980,186(Note) Not disclosed because consent for disclosure has not been obtained from the tenants.

－

45

－

2,499,306

3,154,095

(Unit: thousand yen)
OfficeTotal

RetailTotal

Residence
Total

Logistics facility
Total

Hotel
Total

① Total operating revenue
from real estate leasing

2,217,108

1,014,452

968,232

1,022,855

425,972

Lease business revenue

2,009,772

919,348925,540

981,246

423,608

207,336

95,10442,691

41,6082,364

642,495

415,583

262,756

176,804

53,322

162,720

149,968

59,172

33,116

7,733

7,324

2,865

5,553

3,671

3,200

128,602

116,579

17,55838,56245

Other lease business revenue② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses
Insurance premium

3,192

1,766

1,916

1,618

615

Repair expenses

86,971

11,346

68,977

10,307

4,345

Property taxes

169,874

83,885

51,15384,81135,677

Other

83,80949,17258,423

4,715

1,704

③ NOI
(①－②)

1,574,612

598,869

705,476

846,050

372,650④ Depreciation

205,343

78,959109,543

153,564

80,942⑤ Operating income (loss)
from real estate leasing(③－④)

1,369,269

519,909595,932

692,486

291,707⑥ Capital expenditures

170,716

63,75546,402

27,47923,546

⑦ NCF
(③－⑥)

1,403,896

535,113659,074

818,571

349,103

Book value at end of the period

68,134,518

15,260,962

33,224,657

30,018,678

20,468,131

Portfolio
Total① Total operating revenue
from real estate leasing

5,648,622

Lease business revenue

5,259,516

Other lease business revenue② Total operating expenses
from real estate leasing
Management fee

389,1051,550,962
412,710

Trust fee

22,614

Utilities expenses

301,349

Insurance premium

9,110

Repair expenses

181,948

Property taxes

425,403

Other

197,825

③ NOI
(①－②)

4,097,659④ Depreciation

628,353⑤ Operating income (loss)
from real estate leasing(③－④)

3,469,305⑥ Capital expenditures

331,900

⑦ NCF
(③－⑥)
Book value at end of the period

3,765,759
167,106,948

－

46

－

③ Other investment assets
Asset no.

MEZ-04

Name of the security

Star Asia Mezzanine Loan
Debt Investment Series 4Type of asset

Book value(million yen)

Quantity(Units)

Unit
price

－

Loan receivable－

Fair value(million yen)AmountUnit
price

AmountUnrealized
gain or loss
(million yen)

300

－

300

－

Remarks(Note 1)
(Note 2)

(Note 1) Because interest income etc. from mezzanine loan debt are based on floating interest rates, the fair value is approximately the same as thebook value and thus stated at that book value.
(Note 2) The underlying assets are trust beneficiary interests in a trust mainly composed of DS Kaigan Building.

－47－