(REIT) Financial Report for Fiscal Period Ended January 31, 2019
March 15, 2019
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. (the Asset Management Company)
Atsushi Kato, President and CEO
Toru Sugihara, Director and CFO
TEL: 03-5425-1340

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

April 15, 2019
April 25, 2019

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

Yes
Yes (for institutional investors and analysts)(Amounts are rounded down to the nearest million yen)
1. Status of Management and Assets for Fiscal Period Ended January 31, 2019 (from August 1, 2018 to January 31, 2019)(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. 2019
3,844
36.8
2,406
52.7
2,073
58.8
2,049
57.0
Ended Jul. 2018
2,810
(12.0)
1,576(23.2)
1,305(30.4)
1,305(27.6)Net income
per unit

Fiscal period

Ratio of net income
to equity
yen
3,889
2,775

Ended Jan. 2019
Ended Jul. 2018

%
4.0
2.9

Ratio of ordinary income
to total assets
%
2.0
1.5

Ratio of ordinary income
to operating revenue
%
53.9
46.5

(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)
yenmillion yen

yenmillion yen

Ended Jan. 2019

3,720

2,011

0

Ended Jul. 2018

2,773

1,305

0

Ratio of cash
distribution to
net assets

%

%

0

98.2

3.7

0

100.0

2.8

(Note1) For the fiscal period ended July 31, 2018 and the fiscal period ended January 31, 2019, cash distribution payout ratio is
calculated by the following formula due to changes in the number of investment units during the period following issuanceof new investment units during the period:
Cash distribution payout ratio = Total cash distribution (not including cash distribution in excess of earnings) ÷ Net income ×100(Note2) For the fiscal period ended January 31, 2019, total cash distribution differs from net income due to internal reserve.
(3) Financial Position
Fiscal period

Total assets
million yen
111,079
93,553

Net assets
million yen
54,83947,287

Net cashprovided by (used in)operating activities
million yen
6,219
1,366

Net cashprovided by (used in)investing activities
million yen(19,756)(11,055)

Ended Jan. 2019
Ended Jul. 2018

Equity ratio
%
49.4
50.5

Net assets per unit
yen
101,400
100,477(4) Status of Cash Flows
Fiscal period

Ended Jan. 2019
Ended Jul. 2018－

1 －Net cashprovided by (used in)financing activities
million yen
14,681
9,986

Cash and cash equivalents
at end of period
million yen
6,263
5,118

2. Management Status Forecast for Fiscal Period Ending July 31, 2019 (from February 1, 2019 to July 31, 2019) and Fiscal Period Ending
January 31, 2020 (from August 1, 2019 to January 31, 2020)(% figures are the rate of period-on-period increase (decrease))
Fiscal period

Operating revenue

million yen
Ending Jul. 2019
Ending Jan. 2020

3,713
3,189

Operating income% million yen(3.4)(14.1)

2,155
1,667

Ordinary income% million yen(10.4)(22.7)

1,893
1,442

Net income% million yen(8.7)(23.9)

1,893
1,441

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

(7.6)
(23.9)

3,500
2,770

0
0

(Reference) Forecast net income per unit (fiscal period ending July 31, 2019)3,500 yen
Forecast net income per unit (fiscal period ending January 31, 2020) 2,665 yen(Note) Net income per unit is calculated by the following formula.
Expected net income ÷ expected total number of investment units issued and outstanding at end of period* Other(1) Changes in Accounting Policies, Changes in Accounting Estimates, and Retrospective Restatement① Changes in accounting policies accompanying amendments to accounting standards, etc.: No② 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, 2019
540,824 units
Fiscal period ended Jul. 31, 2018
470,624 units② Number of own investment units at end of period
Fiscal period ended Jan. 31, 2019
0 units
Fiscal period ended Jul. 31, 2018
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 21.
* Presentation of Status of Implementation of Audit Procedures
At the time of disclosure of this financial report, audit procedures for financial statements pursuant to the Financial Instruments andExchange Act have not been completed.
* Explanation of Appropriate Use of Management Status Forecast, and Other Matters of 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, 2019 and Fiscal Period Ending
January 31, 2020” 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, 2019 and Fiscal Period Ending January 31, 2020
Item
Calculation period

Investment assets

Operating revenue

Operating expenses

NOI(Net Operating
Income)Non-operating
expensesAssumptions
 Fiscal period ending July 31, 2019: February 1, 2019 – July 31, 2019 (181 days)
 Fiscal period ending January 31, 2020: August 1, 2019 – January 31, 2020 (184 days)
 For the real estate beneficiary interest in trust of the 34 properties (referred to as the “Existing Properties(real estate, etc.)” hereinafter in these assumptions) , 3 Mezzanine Loan Debt (referred to as the “Existing
Properties (mezzanine)” hereinafter in these assumptions) and 2 Silent Partnership Equity Interest(referred to as the “Existing Properties (silent partnership)” hereinafter in these assumptions) held by SAR
as of today (hereinafter collectively referred to as the “Existing Properties”), it is assumed there will be nochange (new property acquisitions, sales of the Existing Properties, etc.) in the investment assets throughthe end of the fiscal period ending January 31, 2020.
 In practice, this may vary due to changes in investment assets.
 Rent revenues from the Existing Properties (real estate, etc.) are calculated based on the rent stated in
the lease agreements that are effective as of today taking into consideration factors such as market
movement. It is also assumed that there will be no arrears or non-payment of rent by tenants.
 Interest revenues or dividend revenues from the Existing Properties (mezzanine) are calculated based onoutlines , trust agreements or loan agreements which define contents of the Existing Properties(mezzanine) that are effective as of today. It is also assumed that no interest payments or dividend
payments will be declined.
 Dividend revenues from the Existing Properties (silent partnership) are calculated based on theassumption that real estate underlying cash flow will maintain stable operation.
 Gain on sale of Hakata-eki Higashi 113 Building (Quasi co-ownership interest: 51%) executed on February
1, 2019 is expected to be 422 million yen for the fiscal period ending July 31, 2019.
 Among expenses related to rent business of the Existing Properties (real estate, etc.), which are theprincipal operating expenses, expenses excluding depreciation are calculated on the basis of historical
data, reflecting variable factors of expenses.
 Fixed property taxes, city planning taxes and other public charges are expected to be 239 million yen in
the fiscal period ending July 31, 2019 and to be 239 million yen in the fiscal period ending January 31,
2020. When acquiring properties, fixed property taxes, city planning taxes and other public charges in thefiscal year will be settled on a pro rata basis based on the number of days of ownership with the seller at
the time of acquisition of the properties. However, in the case of SAR, the settled amount will be includedin the acquisition cost and thus those for the real estate beneficiary interest in trust of Amusement Media
Gakuin Shinkan acquired on February 1, 2019 will not be recorded as expenses for the fiscal period ending
July 31, 2019 and for the fiscal period ending January 31, 2020. Fixed property taxes, city planning taxes
and other public charges for the property are expected to be 1 million yen and will be recorded as
expenses from the fiscal period ending July 31, 2020.
 For the expenditures for repair and maintenance of buildings, 104 million yen is expected for the fiscal
period ending July 31, 2019 and 85 million yen is expected for the fiscal period ending January 31, 2020
based on repair and maintenance plans prepared by Star Asia Investment Management Co., Ltd. However,
the expenditures for repair and maintenance for the fiscal periods could differ significantly from theestimated amounts, as expenditures may arise urgently due to damage to buildings and such caused by
unexpected factors, and because the variance in amounts generally tends to be significant from year toyear and repair and maintenance expenses do not arise regularly.
 Depreciation is calculated using the straight-line method including ancillary costs and is expected to be
419 million yen for the fiscal period ending July 31, 2019 and 426 million yen for the fiscal period ending
January 31, 2020.
 The total NOI of the entire portfolio is expected to be 2,475 million yen for the fiscal period ending July
31, 2019 and 2,386 million yen for the fiscal period ending January 31, 2020.
 NOI is calculated by using the following calculation method.
NOI = rent revenue – rent expenses (excluding depreciation)
 Interest expenses are expected to be 155 million yen for the fiscal period ending July 31, 2019 and 164
million yen for the fiscal period ending January 31, 2020 and other borrowing related expenses are
expected to be 105 million yen for the fiscal period ending July 31, 2019 and 60 million yen for the fiscal
period ending January 31, 2020.
 In other borrowing related expenses noted above, expected temporary expenses (44 million yen for the
fiscal period ending July 31, 2019) from debt financing or refinancing is included.

－

3 －

Item

Assumptions

Debt financing

 The total amount of interest-bearing liabilities is assumed to be 51,580 million yen as of the end of the
fiscal period ending July 31, 2019 and 51,580 million yen as of the end of the fiscal period ending January
31, 2020.
 As of today, SAR’s balance of outstanding borrowings is 52,040 million yen.
 Early repayment of 460 million yen by the end of the fiscal period ending July 31, 2019 using theconsumption tax refund resulting from the acquisition of properties and payment of other various
expenses in the fiscal period ended January 31, 2019 is assumed.
 It is assumed that 8,000 million yen of loans payable due for repayment by the end of the fiscal period
ending July 31, 2019 will be refinanced in the term.
 Other than the above, it is assumed that there will be no new borrowings or repayment of existing
borrowings including early repayment by the end of the fiscal period ending January 31, 2020.

Investment units It is assumed that there will be no change in the total number of investment units issued and outstanding
as of today (540,824 units) by the end of the fiscal period ending January 31, 2020.

 Cash distribution per unit (not including cash distribution in excess of earnings) is calculated on theassumption described in the cash distribution policy stipulated in SAR’s Articles of Incorporation.
 It is assumed that derivative transactions (interest rate swaps) will continue to be conducted. However, it
is also assumed that deferred losses on hedges, which is an item of deduction from net assets (as those
provided in article 2, item 30 (b) of the Ordinance on Accountings of Investment Corporations), is not
Cash distribution
expected to arise until the end the fiscal period ending January 31, 2020, and cash distribution per unit
per unit(not including cash distribution in excess of earnings) will not be affected by changes in items of deduction(not includingfrom net assets in the calculation.
cash distribution
 It is assumed that a reversal of internal reserve of 56 million yen will be made in the fiscal period ending
in excess of earnings)
January 31, 2020.
 It is possible that the cash distribution per unit (not including cash distribution in excess of earnings) couldchange due to various factors, including changes in investment assets, changes in rent revenue
accompanying changes in tenants, etc., or unexpected repair and maintenance, etc. In addition, cash
distribution per unit (not including cash distribution in excess of earnings) may be affected by changes in
items of deduction from net assets.

Cash distribution
in excess of earnings
per unit

Other

It is assumed that there will be no existing balance of deferred losses on hedges, which is an item of
deduction from net assets, as described above. Of cash distribution in excess of earnings, that attributable
to allowance for temporary difference adjustment is not scheduled at this point.
In addition, of cash distribution in excess of earnings, that falling under the category of cash distribution
accompanying decrease in capital, etc. under tax law is not scheduled at this point.

 Forecasts are based on the assumption that revisions that impact the above forecast figures will not bemade to laws and regulations, tax systems, accounting standards, listing rules, and rules of The Investment
Trusts Association, Japan, etc.
 Forecasts are based on the assumption that there will be no major unforeseen changes to general
economic trends and real estate market conditions, etc.

－

4 －

3.

Financial Statements(1) Balance Sheet(Unit: thousand yen)
5th fiscal period(As of July 31, 2018)

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

5 －6th fiscal period(As of January 31, 2019)

2,000,005
3,118,735
50,970118,176
210,713
16,1575,514,759

2,310,545
3,953,328
52,568120,684
184,8637,153
6,629,144

28,549,452(1,407,469)
27,141,983
9,606(1,070)8,536
45,901(2,718)43,18322,442(4,123)18,31856,437,510
83,649,531

33,050,199(1,712,512)
31,337,686
11,621(1,423)
10,19845,723(4,982)40,74130,828(5,807)25,02068,467,885
222
99,881,755

3,459,138
3,459,138

3,459,138
3,459,138

734,500
155,717
10,00029,887930,105
88,038,774
93,553,534

628,893
300,000
160,951
10,9628,255
1,109,062
104,449,955
111,079,100

(Unit: thousand yen)
5th fiscal period(As of July 31, 2018)
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
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

－

*1

6 －

6th fiscal period(As of January 31, 2019)

190,118
8,490,000
251,986
8,643
605
21,000594,306
9,842
9,566,503

291,171460,000
8,300,000
335,845
10,017
22,611
624,323
14,11910,058,089

34,740,000
1,959,368
493
36,699,861
46,266,365

43,580,000
6,669
2,514,819
79,644
46,181,133
56,239,222

45,832,670

52,745,966

1,418,609
1,418,609
47,251,279

2,163,215
2,163,215
54,909,181

35,88935,88947,287,168
93,553,534(69,303)(69,303)*1 54,839,877
111,079,100

(2) Statement of Income(Unit: thousand yen)
5th fiscal period
From: February 1, 2018
To: July 31, 2018
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
Asset management fee
Asset custody and administrative service fees
Directors’ compensations
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Interest on refund
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing related expenses
Investment unit issuance expenses
Other
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes - current
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

*1
*1

*1

－

7 －

6th fiscal period
From: August 1, 2018
To: January 31, 2019

2,631,029
160,946
18,4762,810,451*1

3,028,065
196,270*2 598,163
22,092
3,844,592

963,758
193,319
20,3232,400
54,427
1,234,229
1,576,222*1*1

1,088,373
260,206
22,3772,400
64,945
1,438,302
2,406,289

26
26

24
848
872

112,385
149,537
7,405
1,000
270,327
1,305,921
1,305,921
605
605
1,305,316
113,292
1,418,609

145,156
150,949
37,238333,3442,073,818
2,073,818
24,172
24,172
2,049,646
113,568
2,163,215

(3) Statement of Unitholders’ Equity
5th fiscal period (from February 1, 2018 to July 31, 2018)(Unit: thousand yen)
Valuation and translation
adjustments

Unitholders’ equity
Surplus
Unitholders’capitalBalance at beginning of theperiod40,031,185

Unappropriatedretainedearnings(undisposed
loss)
1,802,393

Total
net assets

Total
surplus

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

1,802,393

41,833,579

41,870,546

36,96636,966

Changes of items during theperiodIssuance of new
investment units

5,801,484

5,801,484

5,801,484

Dividends from surplus(1,689,101)(1,689,101)(1,689,101)(1,689,101)

Net income

1,305,316

1,305,316

1,305,316

1,305,316

Net changes of items otherthan unitholders’ equity
Total changes of items during
the period
Balance at end of the period(1,077)(1,077)(1,077)5,801,484(383,784)(383,784)

5,417,699(1,077)(1,077)

5,416,622*1 45,832,670

1,418,609

1,418,609

47,251,279

35,88935,88947,287,168

6th fiscal period (from August 1, 2018 to January 31, 2019)(Unit: thousand yen)
Valuation and translation
adjustments

Unitholders’ equity
Surplus
Unitholders’capitalBalance at beginning of theperiod45,832,670

Unappropriatedretainedearnings(undisposed
loss)
1,418,609

Total
net assets

Total
surplus

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

1,418,609

47,251,279

47,287,168

35,88935,889Changes of items during theperiodIssuance of new
investment units

6,913,296

6,913,296

6,913,296

Dividends from surplus(1,305,040)(1,305,040)(1,305,040)(1,305,040)

Net income

2,049,646

2,049,646

2,049,646

2,049,646

Net changes of items otherthan unitholders’ equity
Total changes of items during
the period
Balance at end of the period(105,192)(105,192)(105,192)

6,913,296

744,605

744,605

7,657,901(105,192)(105,192)

7,552,709*1 52,745,966

2,163,215

2,163,215

54,909,181(69,303)(69,303)54,839,877－

8 －(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. Retained earnings carried forward

5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 2019

1,418,609,155

2,163,215,106

1,305,040,352[2,773]2,011,865,280[3,720]1,305,040,352[2,773]2,011,865,280[3,720]113,568,803

151,349,826

Method of calculation of amount of cash distribution
5th fiscal period (from February 1, 2018 to July 31, 2018):
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 of the Act on
Special Measures Concerning Taxation. In accordance with such policy, concerning cash distribution of earnings (not including cash
distribution in excess of earnings), the decision was made to distribute 1,305,040,352 yen, which is the entire amount of the net
income excluding the portion where cash distribution of earnings per unit becomes a fractional amount of less than 1 yen, as cash
distribution of earnings.
6th fiscal period (from August 1, 2018 to January 31, 2019):
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 of the Act on
Special Measures Concerning Taxation. In accordance with such policy, concerning cash distribution of earnings (not including cash
distribution in excess of earnings), the decision was made to distribute 3,720 per unit, 2,011,865,280 yen in total cash distribution
considering the occurrence of gain on sale of real estate of 598,163,538 yen, and within net income, 37,781,023 yen is decided to
be internally reserved.

－

9 －(5) Statement of Cash Flows(Unit: thousand yen)
5th fiscal period
From: February 1, 2018
To: July 31, 2018
Cash flows from operating activities
Income before income taxes
Depreciation
Investment unit issuance expenses
Interest income
Interest expenses
Decrease (increase) in operating accounts receivable
Decrease (increase) in consumption taxes refund 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 in trust
Repayments of tenant leasehold and security deposits
Proceeds from 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
Payments of long-term loans receivable
Other, net
Net cash provided by (used in) investing activities
Cash flows from financing activities
Increase in short-term loans payable
Decrease in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of investment units
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
Cash and cash equivalents at end of period

－

10 －

6th fiscal period
From: August 1, 2018
To: January 31, 20191,305,921
355,808
7,405(26)
112,385(6,300)(210,713)(105,003)(27,960)(34,383)(49,856)(45,613)
256,022(4,875)
1,552,810
26(109,795)(76,159)
1,366,881

2,073,818
409,467
37,238(24)
145,156(1,598)25,849(21,000)(2,507)(5,233)81,74074,25830,016
3,509,673
7,042
6,363,897
24(143,833)(351)
6,219,737(11,219,780)(45,598)
209,986(11,055,392)(20,125,244)
(192)
6,861
(119,296)
674,748(226,511)
334,500(300,000)(962)(19,756,096)

13,460,000(7,580,000)
5,794,079(1,687,802)
9,986,276
297,765
4,820,976*1 5,118,741

4,290,000(3,830,000)
8,840,000(190,000)
6,876,057(1,304,565)
14,681,492
1,145,133
5,118,741*1 6,263,874

(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 amount equivalent toequity 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
5-69 years
Structures
10-15 years
Machinery and equipment
10 years
Tools, furniture and fixtures 3-15 years
3. Accounting forInvestment unit issuance expenses
deferred assets
The entire amount is expensed as incurred.
4. 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 31,134 thousand yen.
5. 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 rules and regulations.
(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.
6. 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.
7. 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 trust; Construction in progress in trust③ Leasehold rights in trust④ Tenant leasehold and security deposits in trust(2) Accounting for consumption tax, etc.
The accounting for consumption tax and local consumption tax is the taxes are excluded from thetransaction amounts.
Non-deductible consumption tax on acquisition of assets is included in the acquisition cost ofeach asset.
－

11 －(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)
5th fiscal period(As of July 31, 2018)

6th fiscal period(As of January 31, 2019)50,00050,000[Notes to the Statement of Income]*1 Breakdown of operating income (loss) from real estate leasing(Unit: thousand yen)
5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 2019

2,354,911

2,661,656

201,909
64,005

260,41293,509

7,346
2,857

10,064
2,422

A. Operating revenue from real estate leasing
Lease business revenue
Rental revenue
Common area maintenance revenue
Parking revenue
Facility use revenue
Other rental revenue

2,631,029

3,028,065

Other lease business revenue
Utilities reimbursement

127,053

Other revenue

33,892

Total operating revenue from real estate leasing

177,469
160,946

18,8002,791,975

196,270
3,224,335

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

130,310

152,418

Utilities expenses
Taxes and dues

130,997
175,769

178,464
173,735

Repair expenses
Trust fee

68,38911,036

77,155
13,049Insurance premium
Depreciation

4,046
355,808

4,801
409,467

Other expenses

87,39979,280Total operating expenses from real estate leasing
C. Operating income (loss) from real estate leasing

[A－B]

－

12 －

963,758

1,088,373

1,828,216

2,135,962

*2 Breakdown of gain on sales of real estate property
5th fiscal period (From: February, 2018 To: July 31, 2018)
Not applicable
6th fiscal period (From: August 1, 2018 To: January 31, 2019)Urban Park Shin-Yokohama(unit: thousand yen)
Real Estate Sale Income
Real Estate Sale Cost

2,775,000
2,554,283

Other Real Estate Sale Expenses

28,250Gain on Real Estate Sale

192,466

Hakata-eki Higashi 113 Building (49% ofquasi co-ownership interest)(unit: thousand yen)

Real Estate Sale Income
Real Estate Sale Cost

1,396,500
955,390

Other Real Estate Sale Expenses

35,412Gain on Real Estate Sale

405,696[Notes to the Statement of Unitholders’ Equity]*1 Total number of investment units authorized and total number of investment units issued and outstanding

Total number of investment units authorized
Total number of investment units issued and outstanding

5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 201910,000,000 units

10,000,000 units

470,624 units

540,824 units[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)
5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 2019

Cash and deposits

2,000,005

2,310,545

Cash and deposits in trust

3,118,735

3,953,328

Cash and cash equivalents

5,118,741

6,263,874[Notes on Lease Transactions]Operating leases (as lessor)
Future minimum lease payments(Unit: thousand yen)
5th fiscal period
As of Jul. 31, 2018

6th fiscal period
As of Jan. 31, 2019

Not later than 1 year

1,976,658

2,872,499

Later than 1 year

4,192,795

9,100,802

6,169,453

11,973,302

Total

－

13 －

[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 “5.
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, 2018, and the amount of difference between these are as follows.
(Unit: thousand yen)
Carrying amount

Fair value

Amount of difference(1) Cash and deposits

2,000,005

2,000,005-(2) Cash and deposits in trust

3,118,735

3,118,735-

734,500

734,500-

5,853,241

5,853,241-(6) Current portion of long-term loans payable

8,490,000

8,490,000-(7) Long-term loans payable

34,740,000

34,740,000-

43,230,000

43,230,000-

35,88935,889-(3) Investment securities
Assets total

Liabilities total(8) Derivative transactions (*)

The carrying amount and fair value as of January 31, 2019, and the amount of difference between these, are as follows.
Financial instruments for which estimation of fair value is recognized to be difficult are not included. Please refer to “Note 2”.
(Unit: thousand yen)
Carrying amount

Fair value

Amount of difference(1) Cash and deposits

2,310,545

2,310,545-(2) Cash and deposits in trust

3,953,328

3,953,328-(3) Investment securities

526,000

526,000-(4) Long-term loans receivable

300,000

300,000-

7,089,874

7,089,874-

460,000

460,000-(6) Current portion of long-term loans payable

8,300,000

8,300,000-(7) Long-term loans payable

43,580,000

43,580,000-

52,340,000

52,340,000-(69,303)(69,303)-

Assets total(5) Short-term loans payable

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.

－

14 －

(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 payable; (6) Current portion of long-term loans payable
Because these are settled in a short period of time, the fair value is approximately the same as the book value and thus stated at that bookvalue.
(3) Investment securities; (4) Long-term loans receivable;
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.
(7) Long-term loans payables
Because long-term loans payable are all with floating interest rates under terms and conditions that interest rates be reviewed every set periodof time, the fair value is approximately the same as the book value and thus stated at that book 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(Unit: thousand yen)
5th fiscal period
As of July 31, 2018

Category
Tenant leasehold and security deposits (*1)
Tenant leasehold and security deposits in trust (*1)

6th fiscal period
As of January 31, 2019
-

6,669

1,959,368

2,514,819-

102,893

Investment securities (*2)(*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 price 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(July 31, 2018)(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

2,000,005

-

-

-

-

-

Cash and deposits in trust

3,118,735

-

-

-

-

-

-

-

-

-

-

734,500

5,118,741

-

-

-

-

734,500

Investment securities
Total(January 31, 2019)(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

2,310,545

-

-

-

-

-

Cash and deposits in trust

3,953,328

-

-

-

-

-

Investment securities

-

-

-

-

526,000-

Long-term loans
receivable

-

-

-

-

300,000-

Total

6,263,874---

826,000-(Note 4) Amount of repayment of loans scheduled to be due after the date of settlement of accounts(July 31, 2018)
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

Long-term loans payable

8,490,000

7,300,000

11,300,000

11,450,000

4,690,000

-

Total

8,490,000

7,300,000

11,300,000

11,450,000

4,690,000

-

－

15 －

(January 31, 2019)
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

460,000

-

-

-

-

-

Long-term loans payable

8,300,000

11,300,000

14,600,000

8,150,000

9,530,000

-

Total

8,760,000

11,300,000

14,600,000

8,150,000

9,530,000-[Notes on Securities]
Other securities
5th fiscal period (as of July 31, 2018)（Unit: thousand yen）
Category

Book value(1) Stock

Acquisition cost

Difference

-

-

-

-

-

-

② Corporate bond

-

-

-

③ Other

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

400,000

400,000

-

-

-

-

334,500

334,500-

734,500

734,500-

734,500

734,500-(2) Bond① Government bond,Book value greaterthan acquisition costmunicipal bond, etc.

(3) Other
Subtotal(1) Stock(2) BondBook value less thanor equal toacquisition cost

① Government bond,municipal bond, etc.
② Corporate bond
③ Other(3) Other
Subtotal
Total

6th fiscal period (as of January 31, 2019)（Unit: thousand yen）
Category(1) Stock

Book value

Acquisition cost

Difference

-

-

-

① Government bond,municipal bond, etc.

-

-

-

② Corporate bond

-

-

-

③ Other

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

400,000

400,000

-

-

-

-

126,000

126,000-

526,000

526,000-

526,000

526,000-(2) BondBook value greaterthan acquisition cost(3) Other
Subtotal(1) Stock(2) BondBook value less thanor equal toacquisition cost

① Government bond,municipal bond, etc.
② Corporate bond
③ Other(3) Other
Subtotal
Total(*) Silent partnership equity interests (book value: 102,893 thousand yen) are not included above because they have no market
value and their fair values are extremely difficult to recognize.
－ 16 －

[Notes on Derivative Transactions]
5th fiscal period (as of July 31, 2018)1.

Derivative transactions to which hedge accounting is not applied
Not applicable.

2.

Derivative transactions to which hedge accounting is applied
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
34,740,000

27,440,000

Fair value(Note 2)35,889(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.

6th fiscal period (as of January 31, 2019)1.

Derivative transactions to which hedge accounting is not applied
Not applicable.

2.

Derivative transactions to which hedge accounting is applied
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
43,580,000

36,280,000

Fair value(Note 2)
(69,303)(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]
5th fiscal period (as of July 31, 2018)
Not applicable.
6th fiscal period (as of January 31, 2019)
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)
5th fiscal period
As of July 31, 2018
Deferred tax assets
Non-deductible accrued enterprise tax

6th fiscal period
As of January 31, 2019

-

1,930

Acquisition cost of securities
Deferred losses on hedge

1,364
-

1,364
21,893

Subtotal
Valuation allowance

1,364(1,364)25,188(25,188)

-

-

-

-

Total
Deferred tax assets, net

－

17 －

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: %)5th fiscal period
As of July 31, 2018
Statutory tax rate

31.74

31.51

[Adjustments]
Deductible distributions payable(31.30)(30.57)

Other(0.40)(0.22)

0.05

1.17

Effective income tax rate
after application of tax-effect accounting[Notes on Share of Profit (Loss) of Entities Accounted for Using Equity Method, etc.]
5th fiscal period (as of July 31, 2018)
Not applicable.
6th fiscal period (as of January 31, 2019)
Not applicable.
[Notes on Related-Party Transactions]
1. Parent company, major corporate unitholder, etc.
5th fiscal period (from February 1, 2018 to July 31, 2018)
Not applicable.
6th fiscal period (from August 1, 2018 to January 31, 2019)
Not applicable.
2.

Affiliated company, etc.
5th fiscal period (from February 1, 2018 to July 31, 2018)
Not applicable.
6th fiscal period (from August 1, 2018 to January 31, 2019)
Not applicable.

3.

6th fiscal period
As of January 31, 2019

Fellow subsidiary, etc.
5th fiscal period (from February 1, 2018 to July 31, 2018)
Not applicable.
6th fiscal period (from August 1, 2018 to January 31, 2019)
Not applicable.

－

18 －

4.

Director, major individual unitholder, etc.
5th fiscal period (from February 1, 2018 to July 31, 2018)

Type

Name ofCapital stock

Description

company,orof business

investmentsorin capital

occupation

etc. or

Address

personDirector,or close
relativeof

Atsushi

－

－

Kato

Percentage
of votingrights, etc.
held by (in)director

Description ofamountAccounttransaction(thousand

item

yen)

SAR

Executive

Payment of

Director of

asset

SAR, andmanagement

President

fee to the

0.01%

and CEO of

Asset

the Asset

Management

Management

Company

Company

Balance atTransaction

end ofperiod(thousandyen)

247,034

Accounts(Note 2)

payable -(Note 3)other208,785(Note 2)

(Note 1)

6th fiscal period (from August 1, 2018 to January 31, 2019)

Type

Name ofCapital stock

Description

company,orof business

investmentsorin capital

occupation

etc. or

Address

personDirector,or close
relativeof

Atsushi

－

－

Kato

director

Percentage
of votingrights, etc.
held by (in)amountAccounttransaction(thousand

item

yen)

Executive

Payment of

Director of

asset

SAR, andmanagement

President

fee to theand CEO of

Asset

the Asset

Management

Management

Company

Company(Note 1)

Description of

SAR

0.01%

Balance atTransaction

end ofperiod(thousandyen)

438,471

Accounts(Note 2)

payable -(Note 3)other280,742(Note 2)

(Note 1)

The transaction is one that was conducted by Atsushi Kato as President and CEO of a third party (the Asset Management Company), andthe transaction amount is based on the terms and conditions provided in the Articles of Incorporation of SAR.

(Note 2)Of the amounts above, the transaction amount does not include consumption tax, while the balance at the end of the period includes
consumption tax.

(Note 3)

Asset management fee of 5th fiscal period includes the acquisition incentive portion included in the book value of individual real estate,etc. in the amount of 53,715 thousand yen. Asset management fee of 6th fiscal period includes the acquisition incentive portion includedin the book value of individual real estate, etc. in the amount of 135,550 thousand yen, the acquisition incentive portion included in thebook value of silent partnership equity interest in the amount of 1,000 thousand yen and the property transfer incentive portion in theamount of 41,715 thousand yen.

[Notes on Asset Retirement Obligations]
5th fiscal period (as of July 31, 2018)
Not applicable.
6th fiscal period (as of January 31, 2019)
Not applicable.

－

19 －

[Notes on Investment and 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 investment and rental properties are as follows:(Unit: thousand yen)
5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 2019

Balance at beginning of period

76,289,122

87,108,669

Amount of increase (decrease) during period

10,819,546

16,232,001

Balance at end of period

87,108,669

103,340,671

95,246,000

111,375,500

Carrying amount

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 investment and rental properties during 5th period, the amount of increase is mainly attributable toacquisition of real estate beneficiary interest in trust of 6 properties (10,894,174 thousand yen) and capital expenditure (281,180 thousandyen), while the amount of decrease is mainly attributable to depreciation (355,808 thousand yen). Of the amount of increase (decrease) ininvestment and rental properties during 6th period, the amount of increase is mainly attributable to acquisition of real estate beneficiaryinterest in trust of 6 properties (19,889,224 thousand yen) and capital expenditure (262,328 thousand yen), while the amount of decrease ismainly attributable to disposition of real estate beneficiary interest in trust of 2 properties (one being 49% of quasi co-ownership) (3,509,673
thousand yen) and depreciation (409,467 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 6th period, that ofHakata-eki Higashi 113 Building (51% of quasi co-ownership) is based on transfer price (1,453,500 thousand yen) stated in the contract dated
July 23, 2018.

The income (loss) concerning investment and rental properties are 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
5th fiscal period (from February 1, 2018 to July 31, 2018)(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 major customers
Information about major customers is omitted because operating revenue to each customer is less than 10% of
operating revenue on the statement of income.

－

20 －

6th fiscal period (from August 1, 2018 to January 31, 2019)(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 major customers（Unit: thousand yen）
Customer nameOperating revenue
405,696

Godo Kaisha Sunrise(Note)

Segment
Real estate leasing business.

(Note) Operating revenue is gain on sales of Hakata-eki Higashi 113 Building (quasi co-ownership interest: 49%)
[Notes on Per Unit Information]
5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 2019

Net assets per unit

100,477 yen

101,400 yen

Net income per unit

2,775 yen

3,889 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) 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)[Notes on Significant Subsequent Events]
Not applicable.

－

21 －

5th fiscal period
From: February 1, 2018
To: July 31, 2018

6th fiscal period
From: August 1, 2018
To: January 31, 20191,305,316

2,049,646--

1,305,316

2,049,646

470,238

526,980

(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 6th fiscal period.
Total number of investment
units issued and outstanding(units)Date
Event
Increase
Balance(Decrease)

Unitholders’ capital(thousand yen)
(Note 11)
Increase
Balance(Decrease)

Remarks

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)

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)

April 19, 2016
May 17, 2016
April 4, 2017

Capital increase throughpublic offering
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)

February 27, 2018

Capital increase throughthird-party allotment

2,683

470,624

276,354

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

52,416,747(Note 9)3,343

540,824

329,218

52,745,966(Note 10)

September 5, 2018
October 2, 2018

Capital increase throughpublic offering
Capital increase throughthird-party allotment(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) 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.

－

22 －

4.

Changes in Directors(1) Directors of SAR
There were no changes in directors in the fiscal period under review.
(2) Directors of the Asset Management Company
Changes in directors are disclosed in immediate release when decided.

5.

Reference Information(1) Investment Status

Type ofasset

Primary use

5th fiscal period

6th fiscal period(As of July 31, 2018)(As of January 31, 2019)

Geographic area

Total amount

As a percentage

Total amount

As a percentage(Note 1)

heldof total assets

heldof total assets(million yen)(%)(million yen)(%)

(Note 2)

(Note 3)(Note 2)

(Note 3)

Greater Tokyo

16,57017.7

19,128

17.2

Other than Greater Tokyo

10,25311.0

16,92015.2

Greater Tokyo

15,03316.1

12,447

11.2

Other than Greater Tokyo

3,148

3.4

3,140

2.8

Greater Tokyo

31,13733.3

31,004

27.9

Greater Tokyo

7,122

7.6

12,857

11.6

Other than Greater Tokyo

3,843

4.1

7,842

7.1

87,10893.1

103,340

93.0

734

0.8

628

0.6

Long-term loans receivable

-

-

300

0.3

Deposits and other assets

5,710

6.1

6,809

6.1

Total amount of assets

93,553100.0

111,079

100.0

OfficeReal

Residence

estatein trust

Logistics facility

Hotel

Subtotal
Investment securities

Amount(million yen)

As a percentage
of total assets(%)

Amount(million yen)

As a percentage
of total assets(%)

Total amount of liabilities (Note 4)

46,26649.5

56,23950.6

Total amount of net assets (Note 4)

47,28750.5

54,83949.4(Note 1) “Greater Tokyo” refers to Tokyo’s 23 wards, Yokohama City and Kawasaki City in the case of the office asset type, andTokyo, 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.

－

23 －

(2) Invested Assets① Investment securities

Asset
no.

Name of the security

QuantityType of asset(Units)Book value

Fair value

Unrealized(million yen)(million yen)gain or

Unit
price

MEZ-01

MEZ-03

Star Asia Mezzanine Loan

Corporate

Debt Investment Series 1

bondStar Asia Mezzanine Loan
Debt Investment Series 3

Silent partnership equity
TKI-01interest in Godo Kaisya
SAPR8

－

Amount

－

Unit
price

400

－

126

－

102

－

628

－

loss
AmountRemarks(million
yen)

400

－

126

－

102

－

628

－

(Note 2)Trust－

beneficiary－(Note 1)

(Note 1)
(Note 3)rightsSilentpartnership－－

equity(Note 4)(Note 5)interest
Total

－

－

－

－

(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) Book value is stated as fair value.
(Note 5) Overview of operating assets are as follows:
Name of the security

Type of specified
asset

Property nameUrban Park

Silent partnership equity interest

Beneficiary interest

in Godo Kaisya SAPR8

in trust－

Mitsuike Koen

Location
6-10-5 Shimosueyoshi, Tsurumi-ku,
Yokohama City, Kanagawa
Prefecture

Urban Park

40-1 Tokiwadai, Hodogaya-ku, Yokohama

Tokiwadai Koen

City, Kanagawa Prefecture

24 －② Real estate(a) Overview of real estate (purchase price, etc.)
PropertyUse

no.

Property nameAcquisition

Share of

Location

price

investment(Note 2)

(million yen)(%)

(Note 3)(Note 4)(Note 1)

OFC-01

OFC-03

OFC-04

Minami-Azabu Shibuya

Minato Ward,

Building

Tokyo

Honmachibashi Tower

Chuo Ward,
Osaka City, Osaka

Nishi-Shinjuku Matsuya

Shibuya Ward,

Building

Tokyo

OFC-05Alphabet Seven

OFC-06

Shibuya MK Building

Minato Ward,Tokyo
Shibuya Ward,
Tokyo

Real estateappraisalvalue, etc.

Acquisition date(million yen)
(Note 5)

2,973

2.9

3,070

January 14, 2016

6,065

5.9

6,950

January 14, 2016

1,763

1.7

2,450

April 20, 2016

1,725

1.7

2,450

April 20, 2016

2,042

2.0

2,980

April 20, 2016

961

0.9

1,453

April 20, 2016

6,320

6.2

7,170

April 20, 2016

2,286

2.2

2,570

April 6, 2017

1,450

1.4

1,520

February 2, 2018

2,580

2.5

2,660

September 6, 2018

7,440

7.3

7,470

September 6, 201835,60534.8

40,743

－

2,045

2.0

2,280

January 14, 2016

6,315

6.2

7,690

January 14, 2016

1,490

1.5

1,610

April 20, 2016

1,460

1.4

1,520

February 1, 2017

1,186

1.2

1,190

April 6, 2017

1,550

1.5

1,570

February 2, 2018

1,167

1.1

1,170

February 2, 201815,213

14.9

17,030－Hakata-eki Higashi 113

Office

OFC-07

Building

Hakata Ward,(51% of quasi co-

Fukuoka City,

ownership interest) (NoteFukuoka

6)
Kanagawa Ward,
OFC-08Asahi Building

Yokohama City,
Kanagawa
Hakata Ward,

OFC-09Hakata-eki East Place

Fukuoka City,
Fukuoka

OFC-10

OFC-11

OFC-12

Nihonbashi Hamacho Park
Building

Chuo Ward, Tokyo

Amusement Media

Shibuya Ward,

Gakuin Honkan

Tokyo

Higashi-KobeHigashinada Ward,

Center Building

Kobe City, Hyogo

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

Minato Ward,Tokyo
Shibuya Ward,Tokyo
Naniwa Ward,
Osaka City, Osaka
Toshima Ward,Tokyo
Kashiwa City,
Chiba
Suita City, Osaka
Suginami Ward,Tokyo

Subtotal－

25 －Iwatsuki Ward,
LGC-01

Iwatsuki Logistics

Saitama City,

6,942

6.8

7,140

January 14, 2016

3,560

3.5

4,060

January 14, 2016

7,875

7.7

8,650

January 14, 2016

4,700

4.6

4,870

April 6, 2017

1,300

1.3

1,350

April 6, 2017

3,000

2.9

3,020

February 2, 2018

821

0.8

842

February 2, 2018

2,755

2.7

2,850

February 2, 2018

30,95330.3

32,782

－

2,069

2.0

2,310

January 14, 2016

1,750

1.7

1,660

January 14, 2016

3,827

3.7

3,840

April 6, 2017

3,248

3.2

3,250

April 6, 2017

1,970

1.9

2,000

September 6, 2018

2,500

2.4

2,520

September 6, 2018

3,180

3.1

3,210

September 6, 2018

2,000

2.0

2,030

September 6, 2018

20,54420.1

20,820－102,315100.0

111,375－

Saitama
Kanagawa Ward,
LGC-02

Yokohama Logistics

Yokohama City,

Logistics facility

Kanagawa
LGC-03

Funabashi Logistics

LGC-04

Baraki Logistics

LGC-05Tokorozawa Logistics

LGC-06

LGC-07

LGC-08

Funabashi City,
Chiba
Ichikawa City,
Chiba
Tokorozawa City,
Saitama

Funabashi Nishiura

Funabashi City,

Logistics I

Chiba

Funabashi Nishiura

Funabashi City,

Logistics II

Chiba

Matsubushi Logistics

Kitakatsushika,
Saitama

Subtotal
HTL-01R&B Hotel Umeda East

HTL-02

Smile Hotel Namba

HTL-03

Kita Ward,
Osaka City, Osaka
Naniwa Ward,
Osaka City, Osaka

BEST WESTERN Tokyo

Edogawa Ward,

Nishikasai

Tokyo
Tsurumi Ward,

HTL-04

BEST WESTERN Yokohama

Yokohama City,

Hotel

Kanagawa

HTL-05

HTL-06

HTL-07

HTL-08

Hotel WBF Fukuoka Tenjin
Minami

Chuo Ward,
Fukuoka City,
Fukuoka

GLANSIT AKIHABARA

Chiyoda Ward,
TokyoBest Western Tokyo

Edogawa Ward,

Nishikasai GrandeTokyo

Hotel WBF Art Stay Namba

Naniwa Ward,
Osaka City, Osaka

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. In the case of Hakataeki Higashi 113 Building, the amount is obtained by multiplying the acquisition price for the entire property by 51% which is the portion ofquasi co-ownership interest owned by SAR.
(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.

－

26 －

(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, 2019 as the date of value, excluding
Hakata-eki Higashi 113 Building, and are rounded to the nearest million yen. For details, please refer to “ (d) Summary of appraisal report.”
As for Hakata-eki Higashi 113 Building, the sale price in the trust beneficiary rights quasi co-ownership interest sale and purchase agreementfor 51% of quasi co-ownership interest as of July 23, 2018 is indicated.
(Note 6) Hakata-eki Higashi 113 Building (51% of quasi co-ownership interest) was sold on February 1, 2019.

(b) Portfolio Summarya.

By Geographic Area
Geographic area

GreaterTokyo

Acquisition price(million yen)

Share
(%)
(Note 1)

5 central wards of Tokyo (Note 2)

23,393

22.9

Other areas in Greater Tokyo

51,341

50.2

73.0

Other than Greater Tokyo

27,581

27.0

Total

102,315100.0(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

Acquisition priceShare(million yen)(%)

Greater

5 central wards of Tokyo

12,533

35.2

Tokyo

Other areas in Greater Tokyo

6,320

17.8

52.9

Other than Greater Tokyo

16,752

47.1

Total

35,605100.0(b) Residence
Geographic area
GreaterTokyo

Acquisition priceShare(million yen)(%)

5 central wards of Tokyo

8,360

55.0

Other areas in Greater Tokyo

3,813

25.1

80.0

Other than Greater Tokyo

3,040

20.0

Total

15,213100.0(c) Logistics facility
Geographic area
Greater

5 central wards of Tokyo

Tokyo

Other areas in Greater Tokyo

Acquisition price(million yen)

Share
(%)

－

－

30,953

100.0

100.0
－

－

30,953

100.0

Other than Greater Tokyo
Total

－

27 －

(d) Hotel
Acquisition price(million yen)

Geographic areab.

Greater

5 central wards of Tokyo

2,500

12.2

Tokyo

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
Acquisition price

Share
(%)

Number ofproperties

5 billion yen or more

(Note)

6

17.6

1 billion yen or more
but less than 5 billion yen

26

76.5

Less than 1 billion yen

2

5.9

Total

34

100.0

but less than 10 billion yen(Note)
c.

Share
(%)

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

By Asset Type (Use)Use

Number of

Acquisition priceShareproperties(million yen)(%)

Office1135,605

34.8

Residence

7

15,213

14.9

Logistics facility

830,953

30.3

Hotel

8

20,544

20.1

Total

34

102,315

100.0

－

28 －

(c) Status of Leasing

Propertyno.

OFC-01

OFC-03

OFC-04

Property nameMinami-Azabu Shibuya
Building
Honmachibashi Tower
Nishi-Shinjuku Matsuya
Building

OFC-05Alphabet Seven

OFC-06

Shibuya MK Building

OFC-07

Hakata-eki Higashi 113
Building (Note 10)

Construction

Number oftenants

completion(Note 1)

June 1993

55

February 2010

(Note 7)

Operating

Security andrevenueguarantee

from leasing

deposits(thousand(thousand

yen)

yen)

(Note 2)

(Note 3)

Leased area Leasable area
(m2)

(m2)

(Note 4)(Note 5)

Occupancy
rate(%)(Note 6)

95,789110,427

3,263.08

3,263.08

100.0

217,594

198,451

10,489.58

10,489.58

100.0

May 1987

10

101,028

120,286

3,521.03

3,521.03

100.0

January 1990

9

76,465100,175

2,464.59

2,464.59

100.0

July 1993

4

76,076

99,047

1,612.88

1,612.88

100.0

October 1987

34

67,76050,344

1,834.32

1,834.32

100.0

OFC-08Asahi Building

November 1994

21

215,210237,2318,672.01

8,672.01

100.0

OFC-09Hakata-eki East Place

February 1986

18

97,76081,0884,632.70

4,632.70

100.0

July 1992

3

43,682

83,364

1,911.84

1,911.84

100.0

Not

Not

Not

disclosed

disclosed

disclosed

1,892.18

100.0(Note 9)(Note 9)(Note 9)OFC-10

OFC-11

Nihonbashi Hamacho Park
Building
Amusement Media Gakuin
HonkanNovember 19941

OFC-12

Higashi Kobe Center Building

January 1992

47

263,133

267,530

16,268.42

16,931.82

96.1

RSC-01

Urban Park Azabujuban

November 1999

44

56,912

11,391

1,986.76

1,986.76

100.0

67

187,182

81,5005,743.06

5,977.18

96.1

May 2009-

28,529----

Existing:
RSC-02

Urban Park Daikanyama

November 1982
Newly built:
May 2006

RSC-04

Urban Park Shin-Yokohama(Note 11)

RSC-05

Urban Park Namba

January 2013

110

51,251100

2,431.93

2,584.81

94.1

RSC-06

Urban Park Gokokuji

February 1990

106

51,541

8,663

1,931.28

1,964.04

98.3

RSC-07

Urban Park Kashiwa

August 1997

41

37,1798,280

2,954.77

2,954.77

100.0

RSC-08

Urban Park Ryokuchi Koen

March 1989

57

54,276

8,651

5,194.28

5,508.94

94.3

RSC-09Urban Park Koenji

October 1987

72

33,545

5,941

1,251.74

1,365.48

91.7

LGC-01

Iwatsuki Logistics

October 2014

3

203,920

97,01430,190.81

30,190.81

100.0

Not

Not

Not

disclosed

disclosed

disclosed

18,142.08

100.0(Note 9)(Note 9)(Note 9)LGC-02

Yokohama Logistics

October 1994

1

－

29 －

Building 1:
LGC-03

Funabashi Logistics

September 1992

4

Building 2:

261,582

83,42634,901.67

38,086.56

91.6

12,185.78

100.0

5,994.75

100.0

14,018.82

100.0

6,315.87

100.0

19,833.47

100.0

August 1997

LGC-04

LGC-05

LGC-06

Baraki Logistics

Tokorozawa Logistics

Funabashi Nishiura Logistics I

August 2015

2

April 1999

1

October 1985

1

Warehouse: March
LGC-07

Funabashi Nishiura Logistics
II

1991
Factory: May 1972

1

Office: May 1986

LGC-08

Matsubushi Logistics

March 1997

1

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)HTL-01R&B Hotel Umeda East

October 2000

1

65,56573,5553,940.93

3,940.93

100.0

HTL-02

Smile Hotel Namba

February 2008

1

42,690-1,711.42

1,711.42

100.0

March 1991

1

85,061

84,6005,293.88

5,293.88

100.0

September 1987

1

80,73180,4004,686.09

4,686.09

100.0

February 2017

1

2,281.49

100.0

1,089.06

100.0

2,755.19

100.0

2,061.46

100.0

248,155.67

98.1

HTL-03

HTL-04

HTL-05

HTL-06

HTL-07

HTL-08BEST WESTERN Tokyo
Nishikasai
BEST WESTERN Yokohama

Hotel WBF Fukuoka Tenjin
Minami

GLANSIT AKIHABARABEST WESTERN Tokyo
Nishikasai Grande

Hotel WBF Art Stay Namba

September 2017

1

February 20171

April 20171

Total (35 properties)

676

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)56,390116,670

2,755.19

Not

Not

Not

disclosed

disclosed

disclosed(Note 9)(Note 9)(Note 9)3,224,335

2,521,488

243,459.22(Note 1) “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, 2019. 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) “Operating revenue from leasing” is rental revenue, common area maintenance revenue, parking revenue and otherrevenue generated from real estate held during the fiscal period under review (including other lease businessrevenue).
－30 －(Note 3) “Security and guarantee deposits” is the sum total amount of tenant security and guarantee deposits required basedon the lease agreement (including deposits based on parking, antenna, rooftop and other agreements; the amountafter depreciation) for each investment asset as of January 31, 2019 (limited to those occupied as of said date).
Furthermore, in cases where a pass-through type master lease agreement has been concluded for the concerned
investment asset, it is the sum total amount of tenant security and guarantee deposits under lease agreements
concluded with end-tenants.
(Note 4) “Leased area” is the sum total of the leased area stated in the lease agreement for each investment asset as ofJanuary 31, 2019. 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, 2019.
(Note 6) “Occupancy rate” is the ratio of leased area to leasable area for each investment asset as of January 31, 2019,
rounded to the first decimal place. In addition, in the total column, it is the ratio of the sum total of leased area tothe sum total of leasable area for each investment asset, rounded to the first decimal place.
(Note 7) 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) In the table, “Number of tenants,” “Security and guarantee deposits,” “Leased area” and “Occupancy rate” are basedon lease agreements valid as of January 31, 2019, even if there is a notice of cancellation or termination of leaseagreements with end-tenants or unpaid rent.
(Note 9) Not disclosed, because consent for disclosure has not been obtained from the tenants.
(Note 10) Leased area and leasable area of Hakata-eki Higashi 113 Building are obtained by multiplying 51% which is the quasi
co-ownership percentage owned by SAR by the area of the entire property.
(Note 11) Urban Park Shin-Yokohama was sold on October 11, 2018.
(d) Summary of Real Estate Appraisal Report, etc.
Summary of appraisal report

Use

Appraisal

Property

Property name

no.

firm
(Note 1)

Income approachAppraisal
value

DCF

methodmethod(million yen)
(Note 2)

Indicatedvalue(million yen)

OfficeCap rate(%)

NOI yield

NOI

Indicated

Discount

Terminal

value

rate

cap rate(million yen)

(%)

(%)

(million yen)(%)

(Note 3)(Note 4)

OFC-01

Minami-Azabu Shibuya Building

Daiwa

3,070

3,170

3.9

3,020

3.5

4.1

139

4.7

OFC-03

Honmachibashi Tower

Daiwa

6,950

7,110

4.2

6,880

4.0

4.4

312

5.2

OFC-04

Nishi-Shinjuku Matsuya Building

Daiwa

2,450

2,420

4.1

2,460

3.9

4.3

112

6.3

OFC-05Alphabet Seven

JREI

2,450

2,490

3.9

2,410

3.7

4.1

101

5.9

OFC-06

Shibuya MK Building

JREI

2,980

3,030

3.7

2,920

3.5

3.9

116

5.7

OFC-08Asahi Building

JREI

7,170

7,190

3.8

7,140

3.5

3.9

303

4.8

OFC-09Hakata-eki East Place

Daiwa

2,570

2,580

4.7

2,560

4.5

4.9

122

5.3

Daiwa

1,520

1,550

4.3

1,510

4.1

4.5

68

4.7

Daiwa

2,660

2,720

3.7

2,640

3.5

3.9

104

4.0

OFC-10

OFC-11
OFC-12

Nihonbashi Hamacho Park
Building
Amusement Media Gakuin
HonkanHigashi Kobe Center Building Tanizawa
Subtotal

Residence

Appraisal

Direct capitalization

7,470

7,610

5.0

7,410

5.1

5.2

430

5.8

39,29039,870-38,950

-

-

1,808

5.2

RSC-01

Urban Park Azabujuban

JREI

2,280

2,320

3.8

2,240

3.6

4.0

91

4.4

RSC-02

Urban Park Daikanyama

JREI

7,690

7,840

3.7

7,540

3.5

3.9

302

4.8

RSC-05

Urban Park Namba

Daiwa

1,610

1,610

4.8

1,600

4.6

5.0

80

5.4

RSC-06

Urban Park Gokokuji

JREI

1,520

1,540

4.2

1,490

4.0

4.4

72

4.9

RSC-07

Urban Park Kashiwa

Tanizawa

1,190

1,220

4.6

1,180

4.7

4.8

60

5.0

－

31 －

RSC-08

Urban Park Ryokuchi Koen

Tanizawa

RSC-09Urban Park Koenji

Tanizawa

1,570

Subtotal

1,560

5.0

5.1

88

5.7

1,170

1,200

4.0

1,160

4.1

4.2

55

4.7

17,03017,310-16,770

-

-

748

4.9

Iwatsuki Logistics

Daiwa

7,140

7,250

4.5

7,090

4.3

4.7

333

4.8

LGC-02

Yokohama Logistics

Daiwa

4,060

4,120

4.3

4,030

4.1

4.5

205

5.7

LGC-03

Funabashi Logistics

Daiwa

8,650

8,760

4.3

8,600

4.1

4.5

429

5.5

LGC-04

Baraki Logistics

Tanizawa

4,870

5,050

4.1

4,790

4.0

4.3

209

4.4

LGC-05Tokorozawa Logistics

JREI

1,350

1,360

5.0

1,340

4.6

5.3

74

5.7

LGC-06

Funabashi Nishiura Logistics I

Daiwa

3,020

3,020

4.6

3,000

4.4

4.8

154

5.1

LGC-07

Funabashi Nishiura Logistics II Daiwa

842

837

5.7

844

5.5

5.9

58

7.1

LGC-08

Matsubushi Logistics

2,850

2,870

5.1

2,830

4.6

5.4

151

5.5

32,78233,267-32,524

-

-

1,612

5.2

HTL-01R&B Hotel Umeda East

Daiwa

2,310

2,330

4.6

2,300

4.4

4.8

116

5.6

HTL-02

Smile Hotel Namba

Daiwa

1,660

1,680

5.0

1,650

4.8

5.2

88

5.0

JREI

3,840

3,900

4.4

3,780

4.2

4.6

177

4.6

JREI

3,250

3,300

4.5

3,190

4.3

4.7

152

4.7

Tanizawa

2,000

2,040

4.4

1,980

4.4

4.6

90

4.6

Tanizawa

2,520

2,580

3.8

2,490

3.7

4.0

98

3.9

Tanizawa

3,210

3,220

3.9

3,200

3.8

4.1

126

4.0

Daiwa

2,030

2,060

4.4

2,020

4.2

4.6

92

4.6

JREI

Subtotal

HTL-03
HTL-04Hotel

4.9

LGC-01

Logistics
facility

1,580

HTL-05
HTL-06
HTL-07
HTL-08BEST WESTERN Tokyo
Nishikasai
BEST WESTERN Yokohama
Hotel WBF Fukuoka Tenjin
Minami
GLANSIT AKIHABARABest Western Tokyo Nishikasai
GrandeHotel WBF Art Stay Namba
Subtotal

20,82021,110-20,610

-

-

938

4.6

Total

109,922

111,557-

108,854

-

-

5,107

5.0

(Note 1) “Appraisal firm” is shown as “Daiwa” to stand for Daiwa Real Estate Appraisal Co., Ltd., “JREI” to stand for Japan Real
Estate Institute and “Tanizawa” to stand for The Tanizawa Sogo Appraisal co., Ltd.
(Note 2) “Appraisal value” is as of January 31, 2019 as the date of value.
(Note 3) “NOI” is the net operating income by the direct capitalization method stated in the appraisal report, rounded to thenearest million yen.
(Note 4) “Appraisal NOI yield” is based on the net operating income by the direct capitalization method stated in the appraisal
report and expressed as a percentage of acquisition price, rounded to the first decimal place.
(Note 5) Hakata-eki Higashi 113 building (51% of quasi co-ownership interest) was sold on February 1, 2019 and is notincluded above.
(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, 2019. Of investment assets, the following are top five properties
in terms of total rental revenue as of January 31, 2019.
Changes in occupancy rate (%) (Note)
January 31, 2017
Funabashi Logistics

July 31, 2017

January 31, 2018

July 31, 2018

January 31, 2019

91.6

91.6

91.6

91.6

91.6

-

-

-

-

96.1

Asahi Building

96.4

100.0

100.0

100.0

100.0

Iwatsuki Logistics

100.0

100.0

100.0

100.0

100.0

Honmachibashi
Tower

100.0

100.0

100.0

100.0

100.0

Higashi Kobe Center
Building(Note)“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.

－

32 －

(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.
Leased area
Name of tenant

Name of property occupied(m2)(Note 1)

As a percentage of
total leasable area(%)
(Note 2)

1

Not disclosed (Note 3)

Iwatsuki Logistics

Not disclosed (Note 3)

12.0

2

Not disclosed (Note 3)

Funabashi Logistics

Not disclosed (Note 3)

8.8

3

Tokyo Nohin Daiko

Matsubushi Logistics

19,833.47

8.0

4

Not disclosed (Note 3)

Yokohama Logistics

Not disclosed (Note 3)

7.3

5

Not disclosed (Note 3)

Funabashi Nishiura Logistics I

Not disclosed (Note 3)

5.6

12,735.16

5.1

BEST WESTERN Tokyo Nishikasai
BEST WESTERN Yokohama

6

Rembrandt Inn

7

Not disclosed (Note 3)

Funabashi Logistics

Not disclosed (Note 3)

2.9

8

Not disclosed (Note 3)

Funabashi Nishiura Logistics II

Not disclosed (Note 3)

2.5

9

Not disclosed (Note 3)

Baraki Logistics

Not disclosed (Note 3)

2.5

10

Not disclosed (Note 3)

Baraki Logistics

Not disclosed (Note 3)

2.4

141,936.75

57.2

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, 2019.
(Note 2) “As a percentage of total leasable area” is the area leased to the tenant expressed as a percentage of the sum totalof 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.

－

33 －

(g) Capital Expenditures
a. Schedule of Capital Expenditures for the 7th fiscal period
The following are the principal capital expenditures arising from renovation construction work, etc. currently planned
for the assets held by SAR as of January 31, 2019. 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)

Alphabet Seven(Minato Ward, Tokyo)b.

PurposeRenovation of exterior wall

Scheduled period

From: Mar. 2019
To:

Jul. 2019

Estimated construction costs(thousand yen)Amount of Total
Total
payment amountamountduringalready
periodpaid
45,000－－Higashi Kobe Center Building(Kobe City, Hyogo)

Renovation of 6th floor office

From: Jan. 2019
To:
May. 2019

31,000－－Asahi Building(Yokohama city, Kanagawa)

Upgrading of air-conditioning
system

From: May. 2019To:
Jun. 2019

20,000－－Capital Expenditures during the 6th fiscal period
The following summarizes the primary construction work that constitutes capital expenditures implemented for theassets held by SAR as of January 31, 2019 during the 6th fiscal period. Capital expenditures for the 6th fiscal periodamounted to 262,328 thousand yen and, when combined with the 77,155 thousand yen in repair expenses charged to
the 6th fiscal period expenses, totals 339,484 thousand yen in construction work implemented.
Name of real estate, etc.
(Location)

Purpose

PeriodHigashi Kobe Center Building(Kobe City, Hyogo)

Upgrading of air-conditioning
system

From: Jul.2018
To: Dec.2018

BEST WESTERNTokyo Nishikasai

Upgrading of automatic fire

From: Oct.2018

alarm system

To:

Renovation of exterior wall

From: Dec.2018
To: Jan.2019

17,908－85,478(Edogawa Ward, Tokyo)
R&B Hotel Umeda East
(Osaka City, Osaka)－

OthersTotal－

Jan.2019

Construction costs(thousand yen)
137,974

20,966262,32834 －(h) Individual Property Income Statements(Unit: thousand yen)

Property no.
Property name

OFC-01

OFC-03

OFC-04

OFC-05

Minami-Azabu

Honmachibashi

Nishi-Shinjuku

Shibuya Building

Tower

Matsuya Building

OFC-06
ShibuyaAlphabet Seven

MK Building① Total operating revenue
from real estate leasing

95,789217,594

101,028

76,46576,076

Lease business revenue

88,399191,695

92,49371,07470,778Other lease business revenue

7,390

25,898

8,535

5,391

5,298

25,60262,47334,04818,363

17,4906,067

13,440

6,717

4,814

4,896

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

400

400

400

400

350

7,038

25,179

9,081

4,715

3,918

Insurance premium

116

358

129

99

45

Repair expenses

1,077

1,746

1,408

669

2,131

Property taxes

4,572

19,766

3,434

6,219

4,316

Other

6,330

1,583

12,877

1,443

1,832

70,187

155,120

66,98058,10258,586④ Depreciation

11,54644,989

8,192

4,568

3,218

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

58,640110,13158,78753,53455,367

③ NOI

(①－②)

⑥ Capital expenditures

-

-

1,553

-

8,641

(③－⑥)

70,187

155,120

65,426

58,102

49,944

Book value at end of the period

2,985,235

5,940,795

1,831,782

1,795,335

2,097,739⑦ NCF

Property no.

Property name

OFC-07

OFC-08

Hakata-eki Higashi
113 Building

OFC-09Asahi Building

OFC-10Hakata-eki
East Place

OFC-11

Nihonbashi

Amusement

Hamacho ParkMedia Gakuin

Building

Honkan① Total operating revenue
from real estate leasing

67,760215,210

97,76043,682

Lease business revenue

60,927

197,652

87,75943,682Other lease business revenue② Total operating expenses
from real estate leasing
Management fee
Trust fee
Utilities expenses

6,832

17,557

10,000-22,05256,89832,582

7,622

6,339

15,780

7,944

717

295

400

400

400

6,723

18,805

8,724-

Insurance premium

123

357

167

123

Not disclosed

Repair expenses

2,296

3,611

6,264

-

(Note)

Property taxes

5,341

15,994

6,582

0

931

1,948

2,498

6,381

Other
③ NOI

(①－②)

45,708158,311

65,17736,059④ Depreciation

5,524

25,395

6,830

2,837

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

40,184

132,916

58,34633,222⑥ Capital expenditures

285

2,868

5,804

-

(③－⑥)

45,422

155,442

59,37336,059Book value at end of the period

994,157

6,353,057

2,312,332

1,464,469⑦ NCF(Note)

Not disclosed, because consent for disclosure has not been obtained from the tenants.

－

35 －

2,600,475

(Unit: thousand yen)

Property no.
Property name

OFC-12

RSC-01

RSC-02

RSC-04

RSC-05

Higashi Kobe

Urban Park

Urban Park

Urban Park

Urban Park

Center Building

Azabujuban

Daikanyama

Shin-Yokohama

Namba① Total operating revenue
from real estate leasing

263,133

56,912

187,182

28,52951,251

Lease business revenue

231,637

55,267177,059

27,946

48,138Other lease business revenue

31,495

1,645

10,123583

3,113

77,4758,438

45,722

6,434

13,072

22,456

2,246

8,605

1,777

2,547

321

350

350

136

350

28,020

592

4,996

449

493

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

528

57

196

102

63

Repair expenses

9,819

1,004

12,119

1,068

3,307

Property taxes

10

2,784

11,218

2,600

2,791

Other

16,318

1,402

8,236

298

3,519

③ NOI
(①－②)

185,657

48,474141,459

22,09538,179④ Depreciation

23,9774,810

12,353

8,221

7,515

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

161,680

43,663

129,105

13,87430,663⑥ Capital expenditures

149,810

-

6,568

-

-

⑦ NCF
(③－⑥)

35,847

48,474

134,891

22,09538,1797,673,330

2,093,247

6,402,295-

1,527,754

Book value at end of the period

Property no.
Property name

RSC-06

RSC-07

Urban Park

Urban Park

Urban Park

Gokokuji

Kashiwa

Ryokuchi Koen

RSC-08

RSC-09LGC-01

Urban Park Koenji

Iwatsuki Logistics① Total operating revenue
from real estate leasing

51,541

37,17954,27633,545203,920

Lease business revenue

50,40636,55051,601

31,416

187,713

Other lease business revenue

1,134

628

2,675

2,129

16,207

11,935

7,670

15,731

9,528

36,429

4,107

1,890

2,415

1,744

5,650

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

400

350

650

400

350

Utilities expenses

2,567

897

2,355

1,494

16,125

Insurance premium

53

85

119

36

275

Repair expenses

1,979

464

5,544

3,614

192

Property taxes

1,838

2,954

-

-

13,835

Other

989

1,027

4,647

2,237

-

③ NOI
(①－②)

39,60529,50838,54424,017

167,491④ Depreciation

5,002

6,918

7,227

2,425

46,532⑤ Operating income (loss)
from real estate leasing(③－④)

34,603

22,59031,317

21,591

120,958

-

-

6,471

1,877

-

39,60529,50832,072

22,139167,491

1,507,722

1,250,273

1,612,342

1,194,022

6,740,410⑥ Capital expenditures
⑦ NCF
(③－⑥)
Book value at end of the period

－

36 －

(Unit: thousand yen)

Property no.
Property name

LGC-02
Yokohama Logistics

LGC-03

LGC-04

Funabashi Logistics① Total operating revenue
from real estate leasing

261,582

Lease business revenue

241,779

Other lease business revenue

19,802② Total operating expenses
from real estate leasing

LGC-05

LGC-06

Baraki Logistics

Tokorozawa Logistics

Funabashi Nishiura
Logistics I

54,025

Management fee

11,308Trust fee

400

Utilities expenses

17,737

Insurance premiumNot disclosed

397

Not disclosed

Not disclosed

Not disclosed

Repair expenses(Note1)1,450(Note1)(Note1)(Note1)

Property taxes

22,709

Other
③ NOI

22
(①－②)

207,556④ Depreciation

26,836⑤ Operating income (loss)
from real estate leasing(③－④)

180,720⑥ Capital expenditures
⑦ NCF

-

(③－⑥)

Book value at end of the period

Property no.
Property name207,556
3,806,450

7,859,798

LGC-07
Funabashi Nishiura
Logistics II

LGC-08
Matsubushi Logistics

4,690,888

HTL-01

1,348,034

2,962,668

HTL-02

HTL-03

R&B Hotel Umeda

Smile HotelBEST WESTERN Tokyo

East

Namba (Note2)

Nishikasai① Total operating revenue
from real estate leasing

65,56542,69085,061

Lease business revenue

65,45242,471

84,600

112

219

461

12,975

4,913

11,754

Management fee

742

660

1,200

Trust fee

350

550

400

Utilities expenses

13

-

-

Other lease business revenue② Total operating expenses
from real estate leasing

Insurance premiumNot disclosed

Not disclosed

113

53

126

Repair expenses(Note1)(Note1)

5,210

1,223

2,049

5,431

2,282

7,954

Property taxes
Other

1,113

143

23

52,58937,77773,307④ Depreciation

9,411

12,177

10,234⑤ Operating income (loss)
from real estate leasing(③－④)

43,17825,59963,072⑥ Capital expenditures

23,792

2,114

29,464

③ NOI

⑦ NCF

(①－②)

(③－⑥)

Book value at end of the period

835,8442,760,059

28,79735,662

43,8422,140,330

1,707,309

3,877,098(Note1) Not disclosed, because consent for disclosure has not been obtained from the tenants.
(Note2) Operating revenue from real estate leasing of Smile Hotel Namba includes variable rents of 20,097 thousand yen.

－

37 －

(Unit: thousand yen)
Property no.
Property name

HTL-04

HTL-05

HTL-06BEST WESTERN

Hotel WBF Fukuoka

GLANSITBest Western Tokyo Hotel WBF Art Stay

HTL-07

HTL-08

Yokohama

Tenjin Minami

AKIHABARA

Nishikasai Grande① Total operating revenue
from real estate leasing

80,731

56,390

Lease business revenue

80,40056,390

331

-

7,801

1,186

1,200

797

400

321

-

-

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

Namba (Note2)

Insurance premium106

Not disclosed

Not disclosed

51

Not disclosed

Repair expenses

1,408(Note1)(Note1)-(Note1)

Property taxes

4,659

9

26

5

Other
③ NOI

(①－②)

72,93055,204④ Depreciation

11,621

9,047⑤ Operating income (loss)
from real estate leasing(③－④)

61,30846,156⑥ Capital expenditures

11,991

-

⑦ NCF

(③－⑥)

60,93855,204

Book value at end of the period

3,264,858

1,982,864

2,517,878

3,197,524

2,012,284(Note1) Not disclosed, because consent for disclosure has not been obtained from the tenants.
(Note2) Operating revenue from real estate leasing of Hotel WBF Art Stay Namba includes variable rents.

Property name

OfficeResidence

Logistics facility

HotelPortfolio

Total

total

total

total

total

① Total operating revenue
from real estate leasing

1,305,280

500,419970,091

448,544

3,224,335

Lease business revenue

1,184,218

478,386

918,040

447,420

3,028,065

121,062

22,03352,0501,124

196,270

358,793

118,533

159,785

41,794

678,906

90,531

25,33529,835

6,716

152,418

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

4,089

2,986

3,050

2,923

13,049114,278

13,84650,325

13

178,464

Insurance premium

2,092

715

1,438

555

4,801

Repair expenses

29,221

29,101

8,940

9,891

77,155

Property taxes

66,24924,187

62,947

20,351

173,735

Other

52,331

22,359

3,247

1,342

79,280

③ NOI
(①－②)

946,487

381,885

810,306

406,750

2,545,429④ Depreciation

140,456

54,474

143,764

70,772

409,467⑤ Operating income (loss)
from real estate leasing(③－④)

806,030

327,411

666,542

335,978

2,135,962⑥ Capital expenditures

168,964

14,91811,082

67,363

262,328

⑦ NCF
(③－⑥)

777,522366,967

799,223

339,386

2,283,100

36,048,710

15,587,658

31,004,154

20,700,148

103,340,671

Book value at end of the period

－

38 －

③ Oher investment assets

Asset

Name of the securityno.

Type of asset

Quantity(Units)Book value

Fair value

Unrealized(million yen)(million yen)gain or

Unit
price

MEZ-04

Star Asia Mezzanine Loan

Loan

Debt Investment Series 4

receivable－－

Amount

300

Unit
price

loss
Amount－Remarks(million
yen)

300

－

(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 the bookvalue and thus stated at that book value.
(Note 2) The underlying assets are trust beneficiary interests in a trust mainly comprised of Premier Kaigan Building.

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39 －