January 12, 2018
For Immediate Release
Real Estate Investment Trust Securities Issuer
Star Asia Investment Corporation
Representative: Atsushi Kato, Executive Director(Code: 3468)
Asset Management Company
Star Asia Investment Management Co., Ltd.
Representative: Atsushi Kato
President and CEO
Contact:

Toru Sugihara
Director and CFO
TEL: 03-5425-1340

Notice Concerning Acquisition of Real Estate Beneficiary Interests in Trustand Lease Contract with New TenantsStar Asia Investment Management Co., Ltd. (the “Asset Manager”), to which Star Asia Investment Corporation(“SAR”) entrusts the management of its assets, announces today its decision to acquire and lease real estate
beneficiary interests in trust of the following six real estate properties (the “Assets to be Acquired” and theentire transaction to acquire and lease these beneficiary interests is referred to as the “Transactions”).

1.

Overview of the Transactions

Property no.

Type(Note 1)

Property nameLocation

PlannedAcquisition price(mn yen) (Note 2)

OfficeOFC-10Nihonbashi Hamacho Park
Building

Chuo-ku, Tokyo

1,450

Residence

RSC-08

Urban Park Ryokuchi Koen (Note 3)

Suita-shi, Osaka

1,550

Residence

RSC-09Urban Park Koenji

Suginami-ku, Tokyo

1,167

Logistics

LGC-06

Funabashi Nishiura Logistics I

Funabashi-shi, Chiba

3,000

Logistics

LGC-07

Funabashi Nishiura Logistics II

Funabashi-shi, Chiba

821

Logistics

LGC-08

Matsubushi Logistics

Kitakatsushika-gun,
Saitama

2,755

Total (6 properties)
Note:

10,743This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

1

(Note 1) As for “Property no.”, please refer to “3. Description of Assets to be Acquired and Leased” below(Note 2) “Planned acquisition price” indicates the planned sale and purchase price stated in the sale and purchase agreement
for the assets to be acquired, rounded to the nearest million yen. The planned sale and purchase price does notinclude consumption tax, local consumption tax and various expenses required for the acquisition.
(Note 3) Property name will be promptly changed to “Urban Park Ryokuchi Koen” after the acquisition from “Cradle Ryokuchi
Koen” as of today.

(1) Contract date(2) Planned acquisition date(3) Sellers(4) Acquisition financing(5) Settlement method: January 12, 2018 (Note 4): February 2, 2018 (delivery and settlement date): Please refer to “4. Seller Profile” below.
: Proceeds from the issuance of new investment units through public
offering (Primary offering) for which resolution was made at the Board of
Directors meeting of SAR held on January 12, 2018, new borrowings andcash on hand(Note 5).
: Payment of entire amount on planned acquisition date.

(Note 4) For Nihonbashi Hamacho Park Building, on January 12, 2018, SAR executed an agreement on transfer of contractual
status in which Star Asia Capital Japan Godo Kaisha (“SACJ Godo Kaisha”) agreed to transfer its status as a purchaser
under the trust beneficial interest sale and purchase agreement for the property to SAR.

Such transfer ofcontractual status to SAR is scheduled to take place on February 2, 2018 subject to the condition precedent that SAR
will have obtained financing. Additionally, SAR plans to pay 1 million yen (exclusive of consumption tax) to SACJ
Godo Kaisha on the Planned Acquisition Date as a consideration for such transfer of contractual status.
(Note 5) Please refer to “Notice Concerning Issuance of New Investment Units and Secondary Offering of Investment Units”
announced today for details.

2.

Reason for the Acquisition and Leasing
SAR holds the investment policy of “prioritized focused investment in the Tokyo metropolitan area”,“continue 'income stability' and 'growth' through diversification of asset types”, “investment primarily in
middle-sized assets”, and “Strategic investment in large-size assets exclusively in 5 central wards of Tokyo(Note)”. In line with this policy, SAR is aiming to realize a steady growth as a diversified REIT.
Through the Transactions, SAR aims to expand the asset size and diversify risks through the increase in thenumber of properties held, as well as mainly to ensure the stability and growth in medium to long-term
profitability. Shown below are key reasons for the investment decision for each of the selected assets.

Furthermore, the tenants of the assets to be acquired satisfy the criteria for the selection of tenants statedin the “Report on the Management Structure and System of the Issuer of Real Estate Investment Trust Units
and Related Parties” set by the Asset Manager on October 31, 2017.
(Note) 5 central wards of Tokyo means Chiyoda-ku, Chuo-ku, Minato-ku, Shinjuku-ku and Shibuya-ku.
[Office](1) Nihonbashi Hamacho Park Building
Nihonbashi Hamacho Park Building is a multi-tenant office building, approx. 2-minute walk from
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

2

Hamacho Station and approx. 5-minute walk from Bakuro-yokoyama Station of Toei Shinjuku Line, andis also located approx. 5-minute walk from Higashi-nihonbashi Station of Toei Asakusa Line andNingyocho Station of both Toei Asakusa Line and Tokyo Metro Hibiya Line.
Nihonbashi Hamacho area, where the property is located, has good access to the major business areas
in Central Tokyo and is convenient for commuters as they have many route options for commuting bytrains. It is also an area of high concentration of offices where various major companies establish their
headquarters. Thus, it has a high appeal to various types and sizes of companies. In addition, the area
is expected to further develop into a mixed-up area with features not only of office district but also
residential and sightseeing district.
In terms of the physical features, the property should satisfy the standards necessary for generaltenants with its rich, tiled exterior as well as individual air-conditioning units, raised floors, etc.
SAR decided to acquire the property through a negotiated transaction through a unique network of theAsset Manager after determining that the acquisition would contribute to the stability of medium tolong-term revenue and enhancement of the stability of the portfolio revenue as a result ofcomprehensive consideration on the characteristics of the location and property.
[Residence](2) Urban Park Ryokuchi Koen
Urban Park Ryokuchi Koen is a family type residential property, approx. 6-minute walk from
Ryokuchi-Koen Station of Kita-Osaka Kyuko Namboku Line (“Namboku Line”).
It is located in the Ryokuchi-Koen area, which is highly convenient for commuting with direct access tomajor areas in Osaka (Shin-osaka, Umeda, Shinsaibashi, Namba, etc.) thanks to through-service
between Namboku Line and Osaka Municipal Subway Midosuji Line, as well as good access toshinkansen (Shin-Osaka Station) and air transportation (Itami Airport). The area is a popular residential
district, especially among family households, as it has an environment with abundant greenery,
including Hattori Ryokuchi-koen and belongs to the region called Hokusetsu area having one of thehighest education standards in Osaka.
In terms of physical features, some dwelling units were renovated and items of internal equipment are
maintained at a certain grade.
As a result of comprehensive consideration on the characteristics of the location and property, SAR
decided to acquire the property by using the Sponsor support after determining that the acquisition
would contribute to the stability of medium to long-term revenue and enhancement of the stability ofthe portfolio revenue.
(3) Urban Park Koenji
Urban Park Koenji is a single-person residential property, approx. 4-minute walk from Koenji Station on
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

3

JR Chuo Line.
It is located in the Koenji area and has an excellent access to major areas such as Shinjuku in Central
Tokyo by taking JR Chuo Line and Soubu Line, and Tokyo Metro Tozai Line. As there are many shopping
streets, full of shops including inexpensive supermarkets, restaurants, and Japanese taverns in front of
Koenji Station, people could enjoy high convenience of living. The area is also known as the epicenterof Koenji’s unique cultures through places such as cafes, second-hand clothing shops, and music clubs,
so it is a popular residential district, especially among single-person households of young working
adults and students.

In terms of physical features, the property maintains a certain level of grade for items of internal
equipment as well as with the tiled facade.
SAR decided to acquire the property by utilizing the warehousing function of the Sponsor Group after
determining that the acquisition would contribute to the stability of medium to long-term revenue andenhancement of the stability of the portfolio revenue as a result of comprehensive consideration on
the characteristics of the location and property.
[Logistics](4) Funabashi Nishiura Logistics I
Funabashi Nishiura Logistics I is a multi-tenant logistics facility, approx. 2.0km to the southeast of the
Wangan-Ichikawa Interchange (“IC”) of the Higashi Kanto Expressway (the “Tokan-do”) and approx.
4.8km northeast of the Chidoricho IC of the Metropolitan Expressway (the “Shutoko”).
It has an excellent access to Central Tokyo as it is located within a radius of approx. 30km from Tokyo
Station, as well as to both Haneda and Narita Airports, that allows it to meet the needs of airfreightlogistics. In addition, its location at approx. 1.1km from the nearest station offers a great convenience
to employees, thus the property has a high appeal to potential tenants.
In terms of the physical features, it is a highly versatile property that features four freight elevators, afloor height of approx. 6.1m – 6.3m, and a pillar span of approx. 6.3m – 6.8m.
SAR decided to acquire the property by using the Sponsor support after determining that theacquisition would contribute to the stability of medium to long-term revenue and enhancement of thestability of the portfolio revenue as a result of comprehensive consideration on the characteristics ofthe location and property.
(5) Funabashi Nishiura Logistics II
Funabashi Nishiura Logistics II is a multi-tenant logistics facility, approx. 1.7km to the east of the
Wangan-Ichikawa IC of the Tokan-do and approx. 4.5km northeast of the Chidoricho IC of the Shutoko.
It has an excellent access to Central Tokyo as it is located within a radius of approx. 30km from Tokyo
Station, as well as to both Haneda and Narita Airports, that allows it to meet the needs of airfreight
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

4logistics. In addition, its location at approx. 1.1km from the nearest station offers a great convenience
to employees, thus the property has a high appeal to potential tenants.
In terms of the physical features, it is a highly versatile property that features four freight elevators, afloor height of approx. 6.0m – 7.0m, and a pillar span of approx. 7.2m – 8.7m.
SAR decided to acquire the property by using the Sponsor support after determining that theacquisition would contribute to the stability of medium to long-term revenue and enhancement of thestability of the portfolio revenue as a result of comprehensive consideration on the characteristics ofthe location and property.
(6) Matsubushi Logistics
Matsubushi Logistics is a multi-tenant logistics facility, approx. 12.0km from the Urawa IC on the
Tohoku Expressway (the “Tohoku-do”), approx. 14.0km from the Nagareyama IC of the Joban
Expressway (the “Joban-do”) and approx. 14.0km from the Soka IC on the Tokyo Outer Ring Road (the“Gaikan-do”).
The property’s connectivity to both Tohoku-do and Joban-do offers an excellent access to Kita-Kantoarea, Joban area, and Tohoku area. In addition, the connectivity to the National Route 16 andGaikan-do ensures the capability of speedy delivery service to the neighboring areas such as Saitama
and Chiba prefecture. Good access to such a wide variety of areas surrounding it is the mostdistinguishing geographical feature of the property.
In terms of the physical features, it is a highly versatile property that features four freight elevators, afloor height of approx. 3.3m – 3.8m, and a pillar span of approx. 9.2m – 10.3m.
SAR decided to acquire the property by using the Sponsor support after determining that theacquisition would contribute to the stability of medium to long-term revenue and enhancement of thestability of the portfolio revenue as a result of comprehensive consideration on the characteristics ofthe location and property.
3.

Description of Assets to be Acquired and Leased
Please refer to Table (1) – Table (6) below, for the detail of each of the assets to be acquired. For the terms
used in the tables, please refer to below.
a.

Explanation on “Property no.” and “Type”
Property Number column and Type column: Each asset to be acquired by SAR is categorized by use as OFC(office), RTL (commercial), RSC (residential), LGC (logistics), or HTL (hotel). Then, for each category, serial
numbers are given to the assets in the category. In case of a property which could straddle two or morecategories, it shall fall under the category from which the property generates the largest sum of assumed
rent income.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

5

b. Explanation on “Overview of specified asset”(a) "Planned Acquisition price" column: Herein is shown the acquisition price of the Assets to be Acquiredas described in the purchase agreement of the Assets to be Acquired (excluding consumption taxes, local
consumption taxes, and expenses necessary for the acquisition), after rounded to the nearest million yen.
(b) "Planned Acquisition Date" column: Herein is shown the planned MMDDYY of acquisition by SAR.
(c) "Location" column: Herein is shown the certified address in registry. "Address column": Herein isshown the postal address. If postal address is not available, registered address of the property (if there
are two or more of them, one is selected) is shown.
(d) "Land" column:(i) "Type of ownership" column: Herein is shown the type of right(s) held by respective trustee of theassets to be acquired.
(ii) "Site area" column: Herein is shown the land area as recorded in registry, unless otherwise noted.
For this reason, it possibly might not be equal to the actual.
(iii) "Use district" column: Herein is shown the type of use in accordance with Article 8 , paragraph 1,
item 1 of the Urban Planning Act (Act No.100 of 1968; including its amendments)(“Urban PlanningAct”).
(iv) "Building coverage ratio" column and "Floor area ratio" column: Herein is shown the pertinent
figure in each column in accordance with the relevant laws and regulations (the Building Standards Act,
the Urban Planning Act, etc.).
(e) "Building" column:(i) "Type of ownership" column: Herein is shown the type of right(s) held by respective trustee of theassets to be acquired.
(ii) "Total floor area" column: Herein is shown the sum total of floor areas as recorded in registry, unlessotherwise noted. For this reason, it possibly might not be equal to the actual figure.
(iii) "Use" column: Herein is shown the registered use or, if multiple uses are registered therepresentative use from what are recorded in registry, it possibly might not be equal to the actual
representative use. As for the building with compartmentalized ownership, the type of use for the
exclusively owned space by SAR is shown.
(iv) "Construction completion" column: Herein is shown MMDDYY of the representative building firstbuilt as recorded in registry.
(v) "Structure and floors" column: Herein is shown the structure of the representative building, etc. as
recorded in registry. It possibly might not be equal to the actual structure. As for the building withcompartmentalized ownership, the structure and the number of floors for the entire building is shown.
(f) "Property management company" column: Herein is shown the name of the property managementcompany (“PM Company”), to which property management operation is planned to be entrusted.
(g) "Master lease company" column: Herein is shown the name of the master lease company, to whichmaster lease operation is planned to be entrusted, as of today.
c. Explanation on “Status of leasing”(a) "Total leasable area" column: Herein is shown the sum total of leasable floor areas of buildings of theassets to be acquired (in case common space is also leased, area of that space is included in the total).
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

6

The figure does not include the area of the land lots leasable for parking and other purposes. Leasablearea is counted not from registry data but from area data as described in lease agreements or from area
data as calculated by using the architectural drawings of the buildings, so it possibly might not be equal to
the total floor area as recorded in registry. Please note that the source data for the column represent
what were provided by the current owner(s) of the assets to be acquired as of October 31, 2017.
(b) "Total leased area" column: Herein is shown the sum total of the floor areas to be leased as describedin lease agreement for each of the assets to be acquired as of October 31, 2017 out of the leasable area.
The figure does not include the area of the land lots to be leased for parking and other purposes. Please
note that the source data for the column represent what were provided by the current owner(s) of theassets to be acquired as of October 31, 2017.
(c) "Occupancy rate" column: Herein is shown the percentage of total floor area leased over the total
leasable floor area of the assets to be acquired, after rounded to the first decimal place. Please note thatthe source data for the column represent what were provided by the current owner(s) of the assets to beacquired as of October 31, 2017.
(d) "Total number of tenants" column: Herein is shown the total number of tenants as confirmed with thelease agreements effective as of October 31, 2017 of the assets to be acquired. In case a specific tenantuses two or more rooms in one of the assets to be acquired, such tenant is counted only once for theasset. Also, in case a specific tenant signs lease agreements for rooms in two or more assets, the tenant
shall be counted for each of the assets separately. In case a pass-through type of master lease agreement(a lease agreement in which the master lessee receives rent from end tenants and pay the same amountto the lessor) is executed for any of the assets to be acquired, total number of the actual tenants underthe master lease agreement for the asset is shown herein.
(e) "Monthly rent (including common area maintenance fee)" column: Herein is shown the total of rent
amounts as described in lease agreements with respective tenants as of October 31, 2017 (confined toroom rents; excluding the charges for warehouses, sign boards and parking lots; but including thecommon service expenses; and free rent cases as of the same date are not considered), after rounded to
the nearest thousand yen.
(f) "Security and guarantee deposits" column: Herein is shown the sum total of refundable deposits as
required in lease agreements effective as of October 31, 2017 (only for the tenants who actually were in
respective rooms at the time) of the assets to be acquired. In case master lease agreement is executed forany of the assets to be acquired, sum total of refundable deposits as described in the individual leaseagreements with respective tenants is calculated to be shown in the column.
d. Explanation on “Special notations”
Special notation column: Herein is shown a description not only on the items considered material in
relation to the involved rights and assumed uses but also on the appraisal value of, profitability of , andthe other items considered material in relation to the disposability of the assets to be acquired.
e. Explanation on “Summary of real estate appraisal report”(a) "Summary of real estate appraisal report" column: Herein is shown a summary of respective appraisal
report, which was prepared either by Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute, or
The Tanizawa Sogo Appraisal Co., Ltd. for the assets to be acquired.
(b) "Appraisal value" column: Herein is shown only the opinions on the value of respective property as ofthe date of appraisal, expressed by the appraiser who did the appraisal of the property, in accordancewith the Act on Real Estate Appraisal (Act No.152 of 1963; including its amendments) and commonly
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

7

accepted appraisal standards for real estate properties, etc.
(c) In case appraisal is once again undertaken for the same property, its result could be different from theprevious result because appraiser and/or appraisal method and/or appraisal timing is different. Also, it isrequested to note that any appraisal result for any property is not what guarantees or promises theactual tradability of the property at the appraised value whether for right now or for any moment in the
future.
(d) Any one of Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute, or The Tanizawa Sogo
Appraisal Co., Ltd. who conducted appraisal is an interested party of neither SAR nor the Asset Manager.
f. Explanation on “Property information and acquisition highlight based on the survey by the AssetManager”
Herein is shown a description on the basic features and characteristics of each of the assets to beacquired as prepared by the Asset Manager from the appraisal report, market reports and from their own
research, as well as a description on the background of its acquisition (if it is an acquisition from Sponsor
Group, background story on the acquisition by the group is described; and if it is an acquisition from theAsset Manager’s own origination, background story on the sourcing is described). "<sponsor fund>”means an acquisition from the Sponsor Group, “<negotiated transaction>” means an acquisition from athird party on a negotiation basis, and “<warehousing>” means an acquisition utilizing the warehousing
function of the Sponsor Group, respectively.
g. Explanation on “Demographic analysis etc., market analysis and independent analysis by the AssetManager”
Herein is shown the result of the Asset Manager’s own market analysis based on the information fromvarious real estate-specialized information providers and other publicly available information.
h. Explanation on “Comprehensive evaluation by SAR”
Herein is shown SAR’s independent comprehensive evaluation based on f. and g. above.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

8

(1)

Nihonbashi Hamacho Park Building
Property
Property
OFC-10Nihonbashi Hamacho Park Building
no.
nameOverview of specified asset
Beneficiary interest in
Type of specified asset
Trusteetrust
Planned Acquisition
Planned Acquisition price
1,450 million yen
Date
Appraisal value
1,520 million yen
SellerLocation
Indication of residential
address
Nearest station
Land (Note Type of2)ownership
Site area
Building
coverage ratio
Type of
Building
ownership
Total floorarea (Note 3)
Construction
completion
Property managementcompany

Type

OfficeSumitomo Mitsui Trust Bank, Limited
February 2, 2018
Domestic GK (Note 1)

2-8-1 Hamacho, Nihonbashi, Chuo-ku, Tokyo and other
2-35-4 Hamacho, Nihonbashi, Chuo-ku, Tokyo
Approx. 2-minute walk from Hamacho Station on Toei Shinjuku Line
Proprietary ownership (Registered right of site: Approx. 58.4%)
319.04m2

Use district

Commercial district

80%

Floor area ratio

700%

Proprietary ownership (Compartmentalized ownership)
2,384.03m2
July 13, 1992
Shimizu
Comprehensive
Development
Corporation

Use

OfficeStructure and floors(Note 4)

Steel-framed reinforced concrete structure
11 floors above ground

Master lease company

SAR

Trust period

End of February, 2028

Security

Unsecured

Status of leasing
Total leasable area

1,911.84m2

Total leased area

1,911.84m2

Occupancy rate

100.0%

Total number oftenants
Monthly rent(including common
area maintenance fee)
Security andguarantee deposits

37,504 thousand yen
64,280,268 yen

Special notation
The bylaws for the building provide that if a unit owner intends to assign their ownership of such unit, the other unit
owners will have a preferential negotiation right.
(Note 1) The information is undisclosed as consent to disclosure has not been obtained from the seller.
(Note 2) This building is in the form of compartmentalized ownership. The land on which the building is located (773.91m2)
consists of (i) the portion subject to the right of site registered in the building registry (546.07m2) and (ii) the portion
individually owned by the other unit owners (227.84m2). As such, the site area is calculated by multiplying (a) the
registered area of the portion of the land referred to in (i) (546.07m2) by (b) the ratio of the right of site to thebuilding subject to acquisition (31,904/54,607). As for the portion of the land referred to in (ii), the right of use has
been established pursuant to the bylaws for the building.
(Note 3) Since this building is in the form of compartmentalized ownership, the total floor area is calculated by multiplying (a)the total floor area of the entire building (5,434.30m2 (registered area of the whole building)) by (b) the ratio of thearea of the exclusive element of the subject to acquisition (43.87%), after rounded to the second decimal place.
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

9(Note 4) While this building is in the form of compartmentalized ownership, the structure and the number of floors areindicated as those of an entire building structure. The floors subject to acquisition are the four floors from the fifth
floor to the eighth floor of the building.
(Note 5) On January 12, 2018, SAR executed an agreement on transfer of contractual status in which SACJ Godo Kaisha
agreed to transfer its status as a purchaser under the trust beneficial interest sale and purchase agreement for theproperty to SAR. Under such agreement, SAR agreed to pay one million yen to SACJ Godo Kaisha as a consideration
for such transfer of contractual status.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

10

(unit:yen)
Property nameSummary of real estate appraisal report
Nihonbashi Hamacho Park Building

Appraisal value
Appraisal firm

1,520,000,000
Daiwa Real Estate Appraisal Co., Ltd.

Date of value
Item
Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses
Repair expenses
Property Management fee
Tenant leasing cost, etc.
Property taxes
Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on
deposits

November 1, 2017
Details
Description, etc.
Estimated by emphasizing the indicated value by DCF method
1,520,000,000 and verifying with the indicated value by direct capitalization
method.
1,550,000,000
92,299,872
97,157,760
Appraised by taking into account the competitiveness of thereal estate, etc. based on the actual vacancy rate of
4,857,888 subject
the subject real estate and the standard vacancy rate ofsimilar real estate.
23,885,821
in Other expenses as management fee according
0 Calculated
to the bylaw.
for communal space is included in Other expenses, and
0 Fee
exclusively owned space is not included as tenant owes.
0 Included in Capital expenditures.
by reference to the level of property management
1,569,098 Appraised
fee of similar real estate.
by reference to the tenant leasing cost, etc. of
576,874 Appraised
similar real estate.
8,572,600 Appraised based on actual data.
273,641 Appraised by reference to the level of similar real estate.
based on the management fee, reserve fund for
12,893,608 Appraised
repairs, etc. in the bylaw.
68,414,051
692,249 Appraised investment return as 1.0%.

(5) Capital expendituresby deducting the reserve fund for repairs of other
2,337,729 Appraised
expenses from the repair and renewal expense on the ER.

(6) Net cash flow
(NCF=(3)+(4)−(5))

66,768,571

based on comparison with past deals for similar
4.3% Appraisedreal estate as the standard method.
Indicated value by DCF method
1,500,000,000
Appraised based on a combination of the method ofwith past deals for similar real estate and the
Discount rate
4.1% comparing
method of reflecting the characteristics of the real estate to
the capitalization rate of the financial asset.
based on capitalization rate and comprehensively
Terminal capitalization rate
4.5% Appraised
taking into account the uncertainty of the market.
by making depreciation adjustment to
Indicated value by cost approach
1,470,000,000 Estimatedreplacement cost.
Ratio of land
84.2%
Ratio of building
15.8%
Determined using the indicated value by income approach as
Matters considered in reconciliation of indicated values
standard and by reference to the indicated value by costand determination of appraisal value
approach.
(7) Capitalization rate

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

11

Property information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

A multi-tenant office building, approx. 2-minute walk from Hamacho Station and approx. 5-minute walk from
Bakuro-yokoyama Station of Toei Shinjuku Line, and is also located approx. 5-minute walk from Higashi-nihonbashi
Station of Toei Asakusa Line and Ningyocho Station of both Toei Asakusa Line and Tokyo Metro Hibiya Line.

-The property has a good access to the major business areas in Central Tokyo and is convenient for commuters as they
have many options for commuting routes by trains.

-

Nihonbashi Hamacho area has a high concentration of offices where various major companies establish their
headquarters, which let it has a high appeal to various types and sizes of companies. In addition, the area is expected tofurther develop into a mixed-up area with features not only of office district but also residential and sightseeing areas.

-

The property should satisfy the standards necessary for general tenants with its rich, tiled exterior as well as individual
air-conditioning units, raised floors, etc.

(2) Acquisition highlight
The property will be acquired through a negotiated transaction by using property information obtained from a unique
network of the Asset Manager (<negotiated transaction>).

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

12Demographic analysis etc., market analysis and independent analysis by the Asset Manager(1) Demographic analysis etc.
Although the number of employees in Chuo-ku had generally been flat between 2001 and 2012, it started to increasesince 2014. The number of offices also slightly increased in 2014. The Asset Manager believes these numbers will remain
stable and steady.
Chuo-ku, Tokyo – Business establishments / Employees*Source:

Prepared by the Asset Manager based on “2014 Economic Census for Business Frame”, “2012 Economic Census for Business
Frame”, “2009 Economic Census for Business Frame”, “2006 Establishment and Enterprise Census” and “2001 Establishment
and Enterprise Census”, Statistics Bureau, Ministry of Internal Affairs and Communications(2) Market analysis
Overall rent had shown a downward trend from 2008 to 2013, but it turned upward after that. Vacancy rate has showna continuous declining trend since 2010 and the current rate (as of 2016) decreased to even lower than 4%. Therefore,
the Asset Manager expects that demands for rental housing will remain stable and steady in the Chuo-ku, Tokyo area.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

13

Chuo-ku, Tokyo – Average Rent Index / Vacancy Rate

*Source:*Note:

Prepared by the Asset Manager based on “MIKI OFFICE REPORT TOKYO 2017,” Miki Shoji Co., ltd
The figure of the Average Rent Index in 2007 is indexed as 100.

(3) Independent analysis by the Asset Manager (Growth potential of Nihonbashi Hamacho area)
In Nihonbashi Hamacho area, there are many traditional, established stores such as wholesalers of kimono fabrics andclothing, and historic buildings and streetscapes such as Meijiza, a theater opened in 1893, and Amazake Yokocho, analley said to have existed since the early Meiji Era (around 1870).
On the other hand, facilities such as “Hama House” and “HAMA 1961,” which facilitate interactions among local
residents, office workers, and tourists, were newly built in this area, and it is expected to further develop into a mixed-up
area with features not only of business district but also of residential and sightseeing areas.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

14

Comprehensive evaluation by SAR: Evaluation of income stability and growth
For the following reasons, SAR believes the property can gain stable revenue over the medium to long-term and can also
expect income growth from increased rent, etc. into the future.
(1) Located in the Nihonbashi Hamacho area with a good access to the major business areas in Central Tokyo and many
train-route options.
(2) Has a high appeal to various types and sizes of companies as the area has a high concentration of offices where many
major companies establish their headquarters.
(3) Expected to further develop into a mixed-up area with features not only of business district but also of residential andsightseeing areas.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

15

(2)

Urban Park Ryokuchi Koen
Property
Property
RSC-08
no.
nameOverview of specified asset

Urban Park Ryokuchi Koen (Note 1)

Type of specified asset

Beneficiary interest in trust

Planned Acquisition price

1,550 million yen

Appraisal value

1,570 million yen

Location
Indication of residential
address
Nearest station
Land (Note Type of2)ownership

4-5-1 Senriyama-nishi, Suita-shi, Osaka

Site area

Building

Building
coverage
ratioType ofownership
Total floor
area
Construction
completion

Property managementcompany
Trust period

TrusteePlanned Acquisition
Date
SellerType

Residence

Mitsubishi UFJ Trust and Banking
Corporation
February 2, 2018
GK SAPR5

4-37-7 Senriyama-nishi, Suita-shi, Osaka
Approx. 6-minute walk from Ryokuchi Koen Station on Kita-Osaka Kyuko Line
Proprietary ownership (Registered right of site: Approx. 20%)2,804.56m2

Use district

Category 1 medium to-high-rise exclusive
residential districts

60%

Floor area ratio

300% (Note 3)

Proprietary ownership (Compartmentalized ownership)
5,854.64m2(Note 4)

March 10, 1989

Takuto Property Co. Ltd

Security

Use
Structure and floors(Note 5)

Apartment house / Parking
Apartment house: Steel-framed
reinforced concrete structure roofing 8
floors above ground
Parking: Steel-framed reinforced
concrete structure 3 floors above ground

Master lease
Takuto Property Co. Ltd
company
End of February, 2028
Unsecured

Status of leasing
Total leasable area

5,508.94m2

Total leased area

5,020.72m2

Occupancy rate

91.1%

Total number oftenants
Monthly rent(including common
area maintenance
fee)
Security andguarantee deposits

55
8,462 thousand yen
7,686,750 yen

Special notation
Not applicable.
(Note 1) Property name will be promptly changed to “Urban Park Ryokuchi Koen” after the acquisition from “Cradle Ryokuchi
Koen” as of today.
(Note 2) The building consists of one apartment building and apart of a parking lot building out of five residential
complex-typed buildings in the form of compartmentalized ownership and both located on a parcel of land
(14,057.95m2). Accordingly, the site area is calculated by multiplying (a) the area of the parcel of land
(14,057.95m2) by (b) the sum (19,950/100,000) of the ratio of the right of site to the apartment house(16,890/100,000) and the ratio of the right of site to the part of the parking lot building (3,060/100,000).
(Note 3) The property is located across districts of two different uses (neighborhood commercial district and category 1
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

16

medium-to-high-rise exclusive residential districts). Weighted average permitted floor area ratio is 209.96%.
(Note 4) Since the building is co-owned by several unit owners, the total floor area is the sum of (i) the total floor area of theentire apartment building subject to acquisition (5478.57m2) and (ii) the total floor area of the parking lot building(1570.90m2) multiplied by 23.94%, the ratio of the area of the exclusive element of the building subject to acquisition,
after rounded to the second decimal place.
(Note 5) While the building is in the form of compartmentalized ownership, the structure and the number of floors areindicated as those of the entire apartment building structure.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

17

(unit:yen)Summary of real estate appraisal report
Urban Park Ryokuchi Koen

Property nameAppraisal value
Appraisal firm

1,570,000,000
The Tanizawa Sogo Appraisal Co., Ltd.

Date of value
Item
Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses
Repair expenses
Property Management fee
Tenant leasing cost, etc.
Property taxes
Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on
deposits(5) Capital expenditures(6) Net cash flow
(NCF=(3)+(4)−(5))(7) Capitalization rate
Indicated value by DCF method
Discount rate
Terminal capitalization rate
Indicated value by cost approach
Ratio of land
Ratio of building

November 1, 2017
Details
Description, etc.
Estimated by emphasizing the indicated value by DCF method
1,570,000,000 and verifying with the indicated value by direct capitalization
method.
1,590,000,000
118,838,858
126,959,940
by taking into account the average cycle period as
8,121,082 Appraised
an apartment complex.
30,583,884
2,578,184 Appraised based on actual data.
4,627,510 Appraised based on actual data.
8,267,909 Appraised based on the ER and similar cases.
2,256,231 Appraised based on verbal confirmation from client.
1,715,484 Appraised by estimating the annual tenant turnover.
7,150,400 Appraised based on actual data.
423,000 Appraised by reference to the level of similar real estate.
3,565,166 Appraised based on actual data.
88,254,974
86,035 Appraised investment return as 1.0%.
10,575,000 Appraised based on the ER and similar cases.
77,766,009
4.9% Appraised by comparing with cap rate of similar real estate.
1,560,000,000
Appraised by taking into account individual risk and5.0% calculating the base cap rate of apartment complexes basedon cap rate of financial instruments.
based on the capitalization rate and reflecting
5.1% Appraised
uncertainty of future prediction.
by making depreciation adjustment to
1,460,000,000 Estimatedreplacement cost.
66.9%
33.1%

Matters considered in reconciliation of indicated values
and determination of appraisal value

Note:

Determined using the indicated value by income approach as
standard and by reference to the indicated value by cost
approach.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

18

Property information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

A family type residential property, approx. 6-minute walk from Ryokuchi-Koen Station onKita-Osaka Kyuko Namboku
Line.

-

Highly convenient for commuting with a direct access to the major areas in Osaka (Shin-osaka, Umeda, Shinsaibashi,
Namba, etc.) by using through-service between Osaka Municipal Subway Midosuji Line.

-A good access to shinkansen (Shin-Osaka Station) and air transportation (Itami Airport) as well as a good location in
Hokusetsu area which has one of the highest education standards in Osaka.

-

Has a high appeal to family households due to the renovation of some dwelling units and items of internal equipment
maintained at a certain level of grade.

(2) Acquisition highlight
The property, which is owned by the Sponsor Group through an acquisition executed in a form of a negotiatedtransaction using the wide range of business relations, will be acquired by utilizing the Sponsor support (<sponsor
fund>).

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

19

Demographic analysis etc., market analysis and independent analysis by the Asset Manager(1) Demographic analysis etc.
Population / Households
Suita-shi keeps growing in both population and number of households, supported by an excellent access to the major
areas in Osaka, and the Asset Manager believes these numbers will remain stable and steady in the future.
Suita-shi – Population / Households*Source:-“2016 Suita-shi Statistics,“ Suita-shi

Number of population increase by area
Since 2011, population growth rate in Suita-shi remains at a high level compared with that of Osaka Prefecture andother cities with high growth rates. The Asset Manager believes the population growth rate will remain stable andsteady.
Population growth rate by areas (Osaka-fu, Osaka-shi, Suita-shi, Toyonaka-shi and Minoh-shi)*Source:

Note:

Prepared by the Asset Manager based on "2016 Suita-shi Statistics“, Suita-shi, “Osaka-shi Annual Estimated Population
Report (2016)”, Osaka-shi, “Minoh-shi website”, Minoh-shi, “Toyonaka-shi Historical Estimated Population”, Toyonaka-shi
and ”Osaka Prefecture Annual Estimated Population Report (as of October 1, 2016)”, Osaka prefectureThis press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

20(2) Market analysis
Overall rent has kept hovering at around the same level since 2012, as shown in the below figure of transition of rent
index.
-

Also as shown in the below figure, vacancy rate has generally remained stable between 2% and 5% despite small
fluctuations.

*Source:*Note:

Made by Japan Real Estate Institute based on the data disclosed by J-REIT (Residence of Suita-shi and Toyonaka-shi, Osaka).
The figure in 1H of 2012 of the Average Rent Index is indexed as 100. 1H refers to the first half (January to June) and 2H
refers to the second half (July to December) hereafter.

(3) Independent analysis by the Asset Manager (Marketability as a residential area)-

The Property has a good access to the major areas in Osaka (Shin-osaka, Umeda, Shinsaibashi, Namba, etc.) thanks to
the through-service between Namboku Line and Osaka Municipal Subway Midosuji Line and easy connections to both
shinkansen (Shin-Osaka Station) and air transportation (Itami Airport). In addition, it is located in Hokusetsu area having
one of the highest education standards in Osaka. Therefore, the Asset Manager believes robust demands for rental
housing will continue, mainly among family households.

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

21

-“Hattori Ryokuchi-koen” located proximate to the property is the largest park in the Hokusetsu area and one of the fourlargest green areas (ryokuchi) in Osaka. It is a large-scale park with lavish greenery, consisting of facilities such as
botanical garden, round flower bed, barbecue facilities, and horse riding field. This park has been selected as one of the“Japan’s 100 Best City Parks” and “Japan’s 100 Best Historic Parks” and is especially popular among family households.
As the property’s vicinity area has an excellent, leafy residential environment with the park as a leading example, theAsset Manager expects that the area is a residential district with a high appeal, especially to family households.

Comprehensive evaluation by SAR: Evaluation of income stability and growth
For the following reasons, SAR believes the property can gain stable revenue over the medium to long-term and can also
expect income growth from increased rent, etc. into the future.
(1) Located in the Ryokuchi-Koen area with a good transportation access and a residential environment with abundant
greenery such as “Hattori Ryokuchi-koen”.
(2) A popular residential district, especially among family households, as the property is located in Hokusetsu area having oneof the highest education standards in Osaka.
(3) Has a high appeal mainly to family households due to the renovation of some dwelling units and items of internal
equipment maintained at a certain level of grade.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

22

Urban Park Koenji
Property
Property
RSC-09no.
nameOverview of specified asset

Urban Park Koenji

TypeType of specified asset

Beneficiary interest in trust

Planned Acquisition price

1,167 million yen

Appraisal value

1,170 million yen

Location
Indication of residential
address
Nearest station
Type ofLand
ownership

3-992-30 Koenji-kita, Suginami-ku, Tokyo and other

Site area

Building

Building
coverage
ratioType ofownership
Total floor
area
Construction
completion

Property managementcompany

TrusteePlanned Acquisition
Date
SellerResidence

Sumitomo Mitsui Trust Bank, Limited
February 2, 2018
GK SAPR6

3-19-12 Koenji-kita, Suginami-ku, Tokyo
Approx. 4-minute walk from Koenji Station on JR Chuo Line
Proprietary ownership
988.26m2 (Note 1)

Use district

Category 1 medium-to-high-rise exclusive
residential districts

60%

Floor area ratio

200% (Note 2)

1,524.34m2

Use

Apartment house

October 13, 1987

Structure and floors

Shimizu Comprehensive
Development
Corporation

Master lease
company

Proprietary ownership

Trust period

End of February, 2028

Security

Unsecured

Steel-framed reinforced concrete
structure 4 floors above groundShimizu Comprehensive
Development
Corporation

Status of leasing
Total leasable area

1,365.48m2

Total leased area

1,267.85m2

Occupancy rate

92.9%

Total number oftenants
Monthly rent(including common
area maintenance
fee)
Security andguarantee deposits

78
5,295 thousand yen
5,971,800 yen

Special notation
Not applicable.
(Note 1) Including the set-back area of 7.10m2(Note 2) Permitted floor area ratio (FAR) of the building due to front road width is 160%.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

23

(unit:yen)Summary of real estate appraisal report
Urban Park Koenji

Property nameAppraisal value
Appraisal firm

1,170,000,000
The Tanizawa Sogo Appraisal Co., Ltd.

Date of value
Item
Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses

November 1, 2017
Description, etc.
Estimated by emphasizing the indicated value by DCF method
1,170,000,000 and verifying with the indicated value by direct capitalization
method.
1,200,000,000
Details

73,677,426
77,369,139
by taking into account the average cycle period as
3,691,713 Appraised
an apartment complex.
16,182,367
2,130,149 Based on the lease agreement.
2,949,437 Appraised based on actual data.

Repair expenses
Property Management fee

4,007,644 Appraised based on the ER and similar cases.
1,531,792 Based on the contract.

Tenant leasing cost, etc.
Property taxes

2,516,238 Appraised by estimating the annual tenant turnover.
1,876,800 Appraised based on actual data.

Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on
deposits(5) Capital expenditures(6) Net cash flow
(NCF=(3)+(4)−(5))(7) Capitalization rate
Indicated value by DCF method
Discount rate
Terminal capitalization rate
Indicated value by cost approach
Ratio of land
Ratio of building

212,500 Appraised based on standard rate.
957,807 Appraised based on actual data.
57,495,059
79,681 Appraised investment return as 1.0%.
7,225,000 Appraised based on the ER and similar cases.
50,349,740
4.2% Appraised by comparing with cap rate of similar real estate.
1,160,000,000
Appraised by taking into account individual risk and4.3% calculating the base cap rate of apartment complexes basedon cap rate of financial instruments.
based on the capitalization rate and reflecting
4.4% Appraised
uncertainty of future prediction.
by making depreciation adjustment to replacement
1,080,000,000 Estimated
cost.
85.5%
14.5%

Matters considered in reconciliation of indicated values
and determination of appraisal value

Note:

Determined using the indicated value by income approach as
standard and by reference to the indicated value by cost
approach.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

24

Property information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

Single type residential property, approx. 4-minute walk from Koenji Station on JR Chuo Line.

-An excellent access to the major areas in Central Tokyo such as Shinjuku.

-

Has a high convenience of living as there are many shopping streets, full of shops including inexpensive supermarkets
and restaurants in front of the station, and has the popularity as the area is also known as the epicenter of Koenji’s
unique cultures through places such as cafes, second-hand clothing shops, and music clubs.

-

Has a high appeal to single-person households of young working adults and students as the property maintains acertain level of grade for items of internal equipment as well as with the tiled facade.

(2) Acquisition highlight
The property will be acquired through a negotiated transaction by using property information obtained from a unique
network of the Asset Manager (utilizing the warehousing function of the Sponsor Group) (<warehousing>).

Demographic analysis etc., market analysis and independent analysis by the Asset Manager(1) Demographic analysis etc.
Both population and number of households in the Koenji area (Koenji-kita, Koenji-minami) have shown an upward
trend, supported by an excellent access to the major areas in Tokyo. Therefore the Asset Manager believes thesenumbers will remain stable and steady.
Koenji area (Koenji-kita / Koenji-minami) – Population / Households*Source:

Note:“Suginami-ku statistical note (2016 edition)”, Suginami-ku

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

25

(2) Market analysis-

Overall rent has been mostly flat since 2012 as shown in the below figure of transition of rent index.

-

Also as shown in the below figure, vacancy rate has generally remained stable between 1% and 4% despite small
fluctuations.

*Source:*Note:

Made by Japan Real Estate Institute based on the data disclosed by J-REIT (Single type residence (average cabin size lessthan 30 m2) of Suginami-ku, Tokyo)
The figure in 2H of 2012 of the Average Rent Index is indexed as 100.

(3) Independent analysis by the Asset Manager (Marketability as a residential area)
The Property has a good access to the major areas in Tokyo (Shibuya, Yotsuya, Takadanobaba, and Marunouchi,
Otemachi, etc) by using the JR Chuo Line and Soubu Line, and Tokyo Metro Tozai Line) and is highly convenient forcommuting. Therefore, the Asset Manager believes demands for rental housing will remain stable and steady.

-

There are several shopping streets including the town’s symbolic “Koenji Junjo Shopping Street” in the vicinity of thestation. The residents could enjoy high convenience of living with 14 shopping streets and more than 10 supermarkets
in the area.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

26

-

The town is enthusiastic about events such as Awa Odori (dance festival), street performances, and Koenji Festival on
its main street and renowned Haruki Murakami set his novel in this town, so it is popular as the epicenter of cultures.

*Source:

Note:“Suginami-ku“This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

27

Comprehensive evaluation by SAR: Evaluation of income stability and growth
For the following reasons, SAR believes the Property can gain stable revenue over the medium to long-term and can also
expect income growth from increased rent, etc. into the future.
(1) Located in the Koenji area with an excellent access to the major areas in Tokyo.
(2) Has a high appeal, especially to single-person households of young working adults and students, thanks to the highconcentration of shopping streets, inexpensive supermarkets, restaurants, Japanese taverns, etc.
(3) The epicenter of Koenji’s unique cultures through places such as cafes, second-hand clothing shops, and music clubs
and popular as a residential area.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

28

(3)

Funabashi Nishiura Logistics I
Property
Property
LGC-06
Funabashi Nishiura Logistics I
no.
nameOverview of specified asset
Beneficiary interest in
Type of specified asset
Trusteetrust
Planned Acquisition
Planned Acquisition price 3,000 million yen
Date
Appraisal value
3,010 million yen
SellerLocation
Indication of residential
address
Nearest IC
Type ofLand
ownership
Site area
Building
coverage
ratioType of
Building
ownership
Total floorarea (Note 1)

Construction
completion
Property managementcompany
Trust period

Type

Logistics

Sumitomo Mitsui Trust Bank, Limited
February 2, 2018
GK Viper

2-6-4 Nishiura, Funabashi-shi, Chiba
2-15-11 Nishiura, Funabashi-shi, Chiba
Approx. 4.8km from the Chidoricho IC on the Bay Shore route of the Metropolitan Expressway
Proprietary ownership
7,142.00m2

Use district

Exclusive industrial district

60%

Floor area ratio

200%

Use

Office / Warehouse

Proprietary ownership
14,018.82m2(total)
Office: 188.22m2
Warehouse: 13,830.60m2(including pump room)

Office: Light steel-framed galvanizedsteel sheet roofing 2 floors above ground
October 11, 1985

Structure and floors
Warehouse: Steel-framed galvanizedsteel sheet roofing 4 floors above ground

CBRE Inc.

Security

Master lease
company
End of January, 2026

SAR

Unsecured

Status of leasing
Total leasable area

14,018.82m2

Total leased area

Not
disclosed(Note 2)

Occupancy rate

100.0%

Total number oftenants
Monthly rent(including common
area maintenance
fee)
Security andguarantee deposits

1
Not disclosed(Note 2)
Not disclosed(Note 2)

Special notation
Not applicable.
(Note 1) The warehouse and pump room have been registered as the buildings ancillary to the office in the registry.
(Note 2) The information is undisclosed as consent to disclosure has not been obtained from end tenants.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

29

(unit:yen)Summary of real estate appraisal report
Funabashi Nishiura Logistics I

Property nameAppraisal value
Appraisal firm

3,010,000,000
Daiwa Real Estate Appraisal Co., Ltd.

Date of value
Item
Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses
Repair expenses
Property Management fee
Tenant leasing cost, etc.
Property taxes
Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on deposits(5) Capital expenditures(6) Net cash flow
(NCF=(3)+(4)−(5))(7) Capitalization rate
Indicated value by DCF method
Discount rate
Terminal capitalization rate
Indicated value by cost approach

November 1, 2017
Description, etc.
Estimated by emphasizing the indicated value by DCF
3,010,000,000 method and verifying with the indicated value by direct
capitalization method.
3,040,000,000
Details

167,931,324
167,931,324
0
14,456,900
0 Unrecorded as tenant owes.
0 Unrecorded as tenant owes.
based on repair expense on ER judged
2,065,000 Appraised
appropriate.
Appraised by reference to the Property management fee
2,400,000 level of similar real estate and based on scheduled contract
amount judged appropriate.
0 Unrecorded as tenant is expected to stay long term.
9,375,900 Appraised based on actual data.
616,000 Appraised based on rate of similar real estate.
0153,474,424
0 No deposit on contract.
based on renewal expense on ER judged
13,510,967 Appraised
appropriate.
139,963,457
based on comparison with past deals for similar
4.6% Appraisedreal estate as the standard method.
2,990,000,000
Appraised based on a combination of the method ofwith past deals for similar real estate and the
4.4% comparing
method of reflecting the characteristics of the real estate to
the capitalization rate of the financial asset.
Appraised based on capitalization rate and4.8% comprehensively taking into account the uncertainty of themarket.
by making depreciation adjustment to
1,540,000,000 Estimatedreplacement cost.

Ratio of land

77.1%

Ratio of building

22.9%
Determined using the indicated value by income approachas standard and by reference to the indicated value by cost
approach.

Matters considered in reconciliation of indicated values anddetermination of appraisal value

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

30

ｈProperty information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

A multi-tenant logistics facility, approx. 2.0km to the southeast of the Wangan-Ichikawa IC of the Tokan-do andapprox. 4.8km northeast of the Chidoricho IC of the Shutoko.

-

An excellent access to Central Tokyo as well as to each consumption area in Chiba that offer flexibility to EC
demands.

-

Located at approx.1.4km from Futamata-shimmachi Station on JR Keiyo Line offers a great convenience to attract
employees.

-

A highly versatile property that features four freight elevators, a floor height of approx. 6.1m – 6.3m, and a pillar
span of approx. 6.3m – 6.8m.

(2) Acquisition highlight
The property, which is owned by the Sponsor Group through an acquisition executed in a form of a negotiatedtransaction using the wide range of business relations, will be acquired by SAR utilizing the Sponsor support(<sponsor fund>).

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

31

Demographic analysis etc., market analysis and independent analysis by the Asset Manager.
(1) Demographic analysis etc. (Analyses of E-commerce and 3PL (third party logistics) markets)
The market size of Japan’s domestic E-commerce market has been growing rapidly, with sales figures that scoredapprox. 3.4 times from approx. 4.4 trillion yen in 2006 to approx. 15.1 trillion yen in 2016.
-

The market of third party logistics (3PL) i.e. outsourced all or part of logistics services that encompass anything thatinvolves logistics management of corporate clients, has also experienced a rapid growth with approx. 2.6 times
increase of sales figures from approx. 1.0 trillion yen in 2005 to approx. 2.6 trillion yen in 2016. We expect thesegrowth trends to prevail in the logistics sector for years to come.

*Source:

The figures above are collected by CBRE, based on ‘‘Results Complied of the E-Commerce Market Survey’’ by METI.

*Source:*Note:

The figures above are collected by CBRE, based on Logi-Biz.
3PL sales volume is calculated by the total sales of leading 3PL operators that responded to a questionnaire sent by
Logi-Biz.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

32

(2) Market analysis
The asking rent index of logistics properties located in Chiba prefecture (medium and large sized properties) and the
Chiba bay area had remained flat in spite of small fluctuations. As it is estimated that the trend of actual rent has
been running parallel to that of the asking rent index, the Asset Manager believes that the index is expected toremain stable and steady for years to come.

*Source:*Note:Note:

CBRE
The asking rent index (Chiba prefecture, medium and large sized properties) represents the index of the asking rent foreach year (for 2017, every quarter until the end of September), with the asking rent of the logistics properties with totallease floor area of 1,000 tsubo or more per building which are located in Chiba prefecture, setting asking rent of 2005 at
100.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

33

*Source:*Note:Note:

CBRE
The asking rent index (Chiba bay zone) represents the index of the asking rent each year (in 2017, every quarter until
the end of September), with the asking rent of the logistics properties with total lease floor area of 1,000 tsubo or
more, which are located in Chiba bay zone, setting asking rent of 2005 at 100. Chiba bay zone is an area set by CBRE forcalculating of asking rent. Q1 means first quarter (from January to March), Q2 means second quarter (from April toJune) and Q3 means third quarter (from July to September ),respectively.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

34

(3) Independent analysis by the Asset Manager
An excellent access to Central Tokyo because of its location at approx. 2.0km to the southeast of the
Wangan-Ichikawa IC of the Tokan-do and within a radius of approx. 30km from Tokyo Station. In addition, theconnection to the Tokan-do ensures an easy access to Chiba and Ibaraki area as well as to both Haneda and Narita
Airports. This is an advantage that allows it to meet the needs of airfreight logistics.
-

Has a high appeal to potential tenants in terms of attracting employees, thinking of its location at approx.1.4km
from the nearest Futamata-shimmachi Station on JR Keiyo Line.

-The construction of the Gaikan-do has been going smoothly, and the section between Misato and Koya, which is
expected to be opened to traffic in June 2018, offers a straight link to the Tokan-do so that ensures much better
access to Saitama area, as well as wide coverage of consumption areas.

*Source:-

Bureau of Urban Development, Tokyo Metropolitan Government

The ban on the internet-based distribution of non-prescription drugs was lifted by enforcement of the revisions to
the Pharmaceutical Affairs Law in June 2014, etc. Accordingly, it is estimated that the demand of buying
non-prescription drugs through e-commerce sites will continue to grow, according to" the report of Ministry of
Economy, Trade and Industry (METI). As consignors at Funabashi Nishiura Logistics I are mostly the e-commerce
operators dealing in pharmaceutical or medical products, the use of the property on a long-term basis is expected.

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

35

EC market size and development of EC ratio (pharmaceutical products and cosmetics)*Source:*Note:

Note:"Results Complied of the E-Commerce Market Survey" by METI.
EC ratio means the ratio of the scale of the EC market to the amount of all commercial transaction (the scale of thecommercial transaction market) hereafter.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

36

Comprehensive evaluation by SAR: Evaluation of income stability
For the following reasons, SAR believes the property can gain stable revenue over the medium to long-term.
(1) Located in Chiba bay area where logistics facilities are concentrated. Along with the location at approx. 1.4km fromthe nearest station, the property is expected to highly appealing to potential clients in terms of attracting employee.
(2) In addition to the access to Central Tokyo, the location allows access to wide range of Tokyo area by partial opening of
the Gaikan Expressway.
(3) Features highly versatile in terms of specifications such as floor height and pillar span.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

37

(4)

Funabashi Nishiura Logistics II
Property no.

Property
name

LGC-07

Funabashi Nishiura Logistics II

Type

Logistics

Overview of specified asset
Type of specified asset

Beneficiary interest in trust

Planned Acquisition price821 million yen

Appraisal value

833 million yen

Location
Indication of residential
address

2-3-3 Nishiura, Funabashi-shi, Chiba and otherType ofownership
Site area
Building
coverage
ratioType ofownership

Building

Sumitomo Mitsui Trust Bank, Limited
February 2, 2018
GK Viper2-1-3 Nishiura, Funabashi-shi, Chiba
Appprox. 4.5km from the Chidoricho IC on the Bay Shore route of the Metropolitan
Expressway

Nearest IC
Land

TrusteePlanned Acquisition
Date
Seller

Proprietary ownership
3,964.00m2

Use district

Exclusive industrial district

60%

Floor area ratio

200%

Use

Warehouse / Factory / Office

Structure and floors

Warehouse: Steel-framed steel sheet
roofing 4 floors above ground
Factory: Steel-framed slate roofing one
story
Office: Steel-framed galvanized steel
sheet roofing 3 floors above ground

Proprietary ownership

Total floorarea

6,316.32m2(total)
Warehouse: 5,110.86m2(including attachments)
Factory: 864.00m2
Office: 341.46m2

Constructioncompletion

Warehouse: March 20,
1991
Factory: May 15, 1972
Office: May 13, 1986

Property managementcompany
Trust period

CBRE Inc.

Security

Master lease
company
End of January, 2022

SAR

Unsecured

Status of leasing
Total leasable area

6,315.87m2

Total leased area

Not disclosed (Note)

Occupancy rate

100.0%

Total number oftenants
Monthly rent(including common
area maintenance
fee)
Security andguarantee deposits

1
Not disclosed (Note)
Not disclosed (Note)

Special notation
Some issues about a concrete block wall in the premises of this property associated with the Building Standers Act has not
yet fixed as of today. The seller and SAR agreed that with the seller’s own responsibility and expense, the seller will fix such
issues within six months from the date of the acquisition of the property by SAR under the purchase and sale agreement ofbeneficiary interest in trust regarding the property.
According to the survey conducted by SAR, a part of the property (factory building) does not satisfy necessary earthquake
resistance standards.
Note:

After acquiring the property, it is planned that construction work to improve earthquake resistanceThis press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

38

will be conducted. The seller and SAR agreed that with the seller`s own responsibility and expense, the seller will complete
such construction work within six months from the date of the acquisition of the property by SAR under the purchase andsale agreement of beneficiary interest in trust regarding the property.
Regarding a part of the property (factory building), it is not confirmed whether inspection completion certificate has been
issued; however, it is confirmed that a Building Standards Act compliance status investigation report has been issued by
Japan ERI confirming that there are no issues.
(Note) The information is undisclosed as consent to disclosure has not been obtained from end tenants.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

39

(unit:yen)Summary of real estate appraisal report
Funabashi Nishiura Logistics II
833,000,000

Property nameAppraisal value
Appraisal firm
Date of value

Daiwa Real Estate Appraisal Co., Ltd.
November 1, 2017
Item

Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses
Repair expenses
Property Management fee
Tenant leasing cost, etc.
Property taxes
Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on deposits(5) Capital expenditures(6) Net cash flow
(NCF=(3)+(4)−(5))(7) Capitalization rate
Indicated value by DCF method
Discount rate
Terminal capitalization rate
Indicated value by cost approach
Ratio of land
Ratio of building

Details

Description, etc.
Estimated by emphasizing the indicated value by DCF
833,000,000 method and verifying with the indicated value by direct
capitalization method.
826,000,000
68,784,120
68,784,120
0
11,524,823
0 Unrecorded as tenant owes.
0 Unrecorded as tenant owes.
based on repair expense on ER judged
1,280,083 Appraised
appropriate.
Appraised by reference to the Property management fee
3,055,440 level of similar real estate and based on scheduled contract
amount judged appropriate.
0 Unrecorded as tenant is expected to stay long term.
6,867,300 Appraised based on actual data.
322,000 Appraised based on rate of similar real estate.
057,259,297
171,960 Appraised investment return as 1.0%.
based on renewal expense on ER judged
10,367,635 Appraised
appropriate.
47,063,622
based on comparison with past deals for similar
5.7% Appraisedreal estate as the standard method.
836,000,000
Appraised based on a combination of the method ofwith past deals for similar real estate and the
5.5% comparing
method of reflecting the characteristics of the real estate
to the capitalization rate of the financial asset.
Appraised based on capitalization rate and5.9% comprehensively taking into account the uncertainty of themarket.
by making depreciation adjustment to715,000,000 Estimatedreplacement cost.
74.0%
26.0%
Determined using the indicated value by income approachas standard and by reference to the indicated value by cost
approach.

Matters considered in reconciliation of indicated values anddetermination of appraisal value

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

40

Property information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

Located approx. 1.7km to the east of the Wangan-Ichikawa IC of the Tokan-do and approx. 4.5km northeast of the
Chidoricho IC of the Shutoko.

-

An excellent access to Central Tokyo as well as to each consumption area in Chiba that offer flexibility to EC
demands.

-

Located at approx. 1.1km to Futamata-shimmachi Station on JR Keiyo Line offers a great convenience to attract
employees.

-

A highly versatile property that features four freight elevators, a floor height of approx. 6.0m – 7.0m, and a pillar
span of approx. 7.2m – 8.7m

(2) Acquisition highlight
The property, which is owned by the Sponsor Group through an acquisition executed in a form of a negotiatedtransaction using the wide range of business relations, will be acquired by SAR utilizing the Sponsor support(<sponsor fund>).

Demographic analysis etc., market analysis and independent analysis by the Asset Manager.
(1) Demographic analysis etc. (Analyses of E-commerce and 3PL (third party logistics) markets)
Same as Funabashi Nishiura Logistics I(2) Market analysis
Same as Funabashi Nishiura Logistics I(3) Independent analysis by the Asset Manager-

An excellent access to Central Tokyo because of its location at approx. 2.0km to the southeast of the
Wangan-Ichikawa IC of the Tokan-do and within a radius of approx. 30km from Tokyo Station. In addition, theconnection to the Tokan-do ensures an easy access to Chiba and Ibaraki area as well as to both Haneda and Narita
Airports. This is an advantage that allows it to meet the needs of airfreight logistics.

-

Has a high appeal to potential tenants in terms of attracting employees, thinking of its location at approx. 1.1km
from the nearest Futamata-shimmachi Station on JR Keiyo Line.

-The construction of the Gaikan-do has been going smoothly, and the section between Misato and Koya, which is
expected to be opened to traffic in June 2018, offers a straight link to the Tokan-do so that ensures much better
access to Saitama area, as well as wide coverage of consumption areas across Kanto area.

Comprehensive evaluation by SAR: Evaluation of income stability
For the following reasons, SAR believes the property can gain stable revenue over the medium to long-term.
(1) Located in Chiba bay area where logistics facilities are concentrated. Along with the location at approx.1.1kmto thenearest station, the Property is expected to highly appealing to potential clients in terms of attracting employee.
(2) In addition to the access to Central Tokyo, the location allows access to wide range of Tokyo by partial opening of the
Gaikan Expressway.
(3) Features highly versatile in terms of specifications such as floor height and pillar span.
Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

41

(5)

Matsubushi Logistics
Property
Property
LGC-08
Matsubushi Logistics
no.
nameOverview of specified asset
Beneficiary interest in
Type of specified asset
Trusteetrust
Planned Acquisition
Planned Acquisition price
2,755 million yen
Date
Appraisal value
2,850 million yen
SellerLocation
Indication of residential
address
Nearest IC
Type ofLand
ownership
Site area
Building
coverage ratio
Type of
Building
ownership
Total floor
area
Construction
completion
Property managementcompany
Trust period

Type

Logistics

Sumitomo Mitsui Trust Bank, Limited
February 2, 2018
GK 29er

2410-3 Yadomichi, Okawado-aza, O-aza, Matsubushi-cho, Kitakatsushika-gun, Saitama
Approx. 12.0km from the Urawa IC on the Tohoku Expressway
Proprietary ownership
11,580.65m2

Use district- (Urbanization control district)

60%

Floor area ratio

200%

19,833.47m2

Use

Warehouse

March 31, 1997

Structure and floors

Reinforced concrete structure 3 floors
above ground

Proprietary ownership

CBRE Inc.

Security

Master lease
company
End of February, 2028

SAR

Unsecured

Status of leasing
Total leasable area

19,833.47m2

Total leased area

19,833.47m2

Occupancy rate

100.0%

Total number oftenants
Monthly rent(including common
area maintenance
fee)
Security andguarantee deposits

1
Not disclosed (Note)
Not disclosed (Note)

Special notation
Not applicable.
(Note) The information is undisclosed as consent to disclosure has not been obtained from the end-tenant.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

42

(unit:yen)Summary of real estate appraisal report
Matsubushi Logistics
2,850,000,000

Property nameAppraisal value
Appraisal firm
Date of value

Japan Real Estate InstituteNovember 1, 2017
Item

Indicated value by income approach
Indicated value by direct
capitalization method(1) Operating revenue ((a)−(b))(a) Gross potential income(b) Vacancy loss, etc.
(2) Operating expenses
Maintenance andmanagement fee
Utilities expenses
Repair expenses
Property Management fee
Tenant leasing cost, etc.
Property taxes
Insurance premium
Other expenses(3) Net operating income(NOI=(1)−(2))(4) Financial interests on deposits(5) Capital expenditures(6) Net cash flow
(NCF=(3)+(4)−(5))(7) Capitalization rate
Indicated value by DCF method
Discount rate
Terminal capitalization rate
Indicated value by cost approach
Ratio of land

Details

Description, etc.
Calculatedbyassociatingbased on the direct
2,850,000,000 capitalization method andvaluethat based on the DCF method.
2,860,000,000
172,817,000
172,817,000
022,323,000
0 Owed by tenant according to the lease contract.
0 Owed by tenant according to the lease contract.
based on the historical data by taking into
5,120,000 Appraised
account the fee level of similar real estate.
Appraised by reference to the fees based on the agreement
2,400,000 terms and taking into account the characteristics of theproperty.
0
based on documents related to taxes and public
14,363,000 Recorded
charges.
by taking into account the insurance rate of
440,000 Appraised
similar real estate.
0150,494,000
432,000 Appraised investment return as 1.0%.
by taking into account the capital expenditure
4,868,000 Appraisedlevel, building age and the ER of similar real estate.
146,058,000
Appraised by moderating the individual factors such asof the subject real estate from the basis yield, and5.1% location
taking into account uncertainty of the future and cap rate,
etc. of similar real estate.
2,830,000,000
Appraised by comprehensively taking into accountcharacteristics, etc. of subject real estate by
4.6% individualreference to the investment yield, etc. of similar realestate.
Appraised by comprehensively taking into account the
5.4% uncertainty of the future by reference to the cap rate, etc.
of similar real estate.
by making depreciation adjustment to1,760,000,000 Estimatedreplacement cost.
45.1%

Ratio of building
54.9%
Matters considered in reconciliation of indicated values andDetermined using the indicated value by income approach
determination of appraisal value
and by reference to the indicated value by cost approach.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

43

Property information and acquisition highlight based on the survey by the Asset Manager(1) Property information-

A multi-tenant logistics facility, approx. 12.0km from the Urawa IC on the Tohoku-do, approx. 14.0km from the
Nagareyama IC of the Joban-do and approx. 14.0km from the Soka IC on the Gaikan-do.

-

An access available to Kita-Kanto area, Joban area, and Tohoku area thanks to the connectivity to two expressways of
Tohoku-do and Joban-do.

-

The capability of speedy delivery service to the neighboring areas such as Saitama and Chiba prefecture thanks to theconnectivity to the National Route 16 and Gaikan-do.

-

A highly versatile property that features four freight elevators, a floor height of approx. 3.3m – 3.8m, and a pillar spanof approx. 9.2m – 10.3m.

(2) Acquisition highlight
The property, which is owned by the Sponsor Group through an acquisition executed in a form of a negotiatedtransaction using the wide range of business relations, will be acquired by SAR utilizing the Sponsor support (<sponsor
fund>).

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

44

Demographic analysis etc., market analysis and independent analysis by the Asset Manager(1) Demographic analysis etc. (Analyses of E-commerce and 3PL (third party logistics) markets)
Same as Funabashi Nishiura Logistics I(2) Market analysis
The asking rent index of logistics properties with total floor area of 1,000 tsubo or 3,300 square meters or more, andlocated in the area along Japan National Route 16 had remained mostly flat in spite of small fluctuations. As it isestimated that the trend of actual rent has been running parallel to that of the asking rent index, the Asset Manager
believes that the index is expected to remain stable and steady.

*Source:*Note:

Note:

CBRE Inc.
The asking rent index (Saitama prefecture) represents the index of the asking rent for each year (for 2017, every quarter
until the end of September), with the asking rent of the logistics properties with total lease floor area of 1,000 tsubo or
more per building which are located in Saitama prefecture, setting asking rent of 2005 at 100.

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

45

*Source:*Note:CBRE Inc.
The asking rent index (National Route 16 area) represents the index of the asking rent for each year (for 2017, every
quarter until the end of September), with the asking rent of the logistics properties with total lease floor area of 1,000
tsubo or more which are located in National Route 16 area, setting asking rent of 2005 at 100. National Route 16 area isan area set by CBRE for calculation of asking rent and represents semi-oval area from outside of the Tokyo-Gaikan-do to
wayside of Kanjo-doro and the National Route 16.

(3) Independent analysis by the Asset Manager
In Saitama Prefecture, the development of logistics facilities has been invigorated by the initiative “Chance Maker
Saitama Strategy Phase III”, which was implemented by the municipal government from April 2013 to March 2016.
Considering the results of the Phase III and the on-going “Chance Maker Saitama Strategy Phase IV”, which will be
implemented by the municipal government from April 2016 to March 2019, the demand for the logistics properties in
the areas surrounding the property is expected to surge continuously in the future. Supported by administrative
initiatives such as above, the area around the property is expected to develop as an industrial cluster where logistics
facilities are concentrated.

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

46

Success of enticement of companies by Chance Maker Saitama Strategy Phase III-

Thanks to a surge of female internet users, the apparel and fashion revenue through online shopping has increased forthree years in a row, according to a METI report. As consignors at the property are e-commerce operators dealing inapparel and fashion products, the use of the property on a long-term basis is expected.

EC market size and development of EC ratio (clothing, clothing accessories, etc.)*Source: "Results Complied of the E-Commerce Market Survey" by METI.

Comprehensive evaluation by SAR: Evaluation of income stability
For the following reasons, SAR believes the property can gain stable revenue over the medium to long-term.
(1) Located in Matsubushi area which offers an excellent access to Kita-Kanto area, Joban area, and Tohoku area, as well as tothe neighboring areas such as Saitama and Chiba prefectures.
(2) Highly versatile in terms of specifications such as spacious berth for accessing vehicles, elevators for cargoes, floor heightand pillar span.
(3) Public backups for generating business opportunities such as a series of initiatives launched by the Saitama municipal
government (“Chance Maker Saitama Strategy”).

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

47

4. Seller Profile(1) OFC-10 Nihonbashi Hamacho Park Building
Name
Location
Representative
Main business description
CapitalEstablishedNet asset

Domestic GK

The information is undisclosed as consent to disclosure has not been obtained from thecompany.

Total asset
Major shareholders andshareholding ratio
Relationship with SAR or the Asset Manager
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The Seller does not fall under the category of interested person.

(2) RSC-08 Urban Park Ryokuchi Koen
Name

GK SAPR5

Location

Capital5-1-4 Toranomon, Minato-ku, Tokyo
Representative partner: Ippanshadanhoujin SAPR Holding5
Operational executor: Takaaki Fukunaga
1. Acquisition, ownership and disposition of beneficiary interest in trust of real estate
2. Acquisition, ownership and disposition of loan claims
3. Acquisition, ownership and disposition of corporate bonds, silent partnership interest andother securities
4. Sales, leasing, management, acquisition, ownership, disposition and use of real estate
5. All business incidental to the above
100,000 yen

Established

October 20, 2015

Representative
Main business description

Net asset
Total asset

The information is undisclosed as consent to disclosure has not been obtained from the

Major shareholders andcompany.

shareholding ratio
Relationship with SAR or the Asset Manager
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personnel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The Seller does not fall under the category of interested person, etc. as provided in theInvestment Trusts Act, but falls under the category of interested party prescribed in the“Rules on Transactions with Interested Parties”, which is the voluntary rules set forth by the
Asset Manager for preventing conflict of interests regarding its management of SAR’s assets.
Upon determination of the acquisition of the assets, the Asset Manager has performed
deliberation and approval in accordance with the voluntary rules.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

48

(Note) “Interested parties” are (i) the Interested Parties of the Asset Manager as provided in Article 201, paragraph 1 of theInvestment Trust Act, (ii) the shareholders and officers of the Asset Manager, (iii) SPCs which execute an investment
management agreement with the shareholders of the Asset Manager, (iv) SPCs a majority of investment of which are
made by the Asset Manager and the shareholders of the Asset Manager,(v)Star Asia Management Limited, Star Asia
Management Japan Limited, Star Asia Asset Management LLC, Star Asia Group LLC, Star Asia Asset Advisors Co., Ltd.,Star Asia Sogo Kaihatsu Co., Ltd., Malcolm F. MacLean IV, Taro Masuyama, as well as investment vehicles invested byfunds under management of Malcolm F. MacLean IV and Taro Masuyama (excluding minority interests) which (a) arelocated in Japan to own or acquire real estates or other investment assets and (b) own or acquire the investment
units of SAR. This applies to any other assets described below.

(3) RSC-09 Urban Park Koenji
Name

GK SAPR6

Location

Capital5-1-4 Toranomon, Minato-ku, Tokyo
Representative partner: Ippanshadanhoujin SAPR Holding5
Operational executor: Takaaki Fukunaga
1. Acquisition, ownership, and disposition of beneficiary interest in trust of real estate
2. Acquisition, ownership and disposition of loan claims
3. Acquisition, ownership and disposition of corporate bonds, silent partnership interest andother securities
4. Sales, leasing, management, acquisition, ownership, disposition and use of real estate
5. All business incidental to the above
100,000 yen

Established

October 20, 2015

Representative
Main business description

Net asset
Total asset

The information is undisclosed as consent to disclosure has not been obtained from the

Major shareholders andcompany.

shareholding ratio
Relationship with SAR or Asset Management company
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personnel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The Seller does not fall under the category of interested person, etc. as provided in theInvestment Trusts Act, but falls under the category of interested party prescribed in the“Rules on Transactions with Interested Parties”, which is the voluntary rules set forth by the
Asset Manager for preventing conflict of interests regarding its management of SAR’s assets.
Upon determination of the acquisition of the assets, the Asset Manager has performed
deliberation and approval in accordance with the voluntary rules.

(4) LGC-06 Funabashi Nishiura Logistics I, LGC-07 Funabashi Nishiura Logistics II
Name

GK ViperLocation

1-1-7 Motoakasaka, Minato-ku, Tokyo
Representative partner: Ippanshadanhoujin Chojagasaki
Operational executor: Terumitsu Nosaka
1. Acquisition, ownership, disposition and management of securities and beneficiary interestin trust

Representative
Main business description
Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

49Capital

2. Acquisition, development, ownership, disposition, management and lease of real estate
3. Acquisition, ownership and disposition of loan claims
4. All business incidental to the above
300,000 yen

Established

August 1, 2013

Net asset
Total asset

The information is undisclosed as consent to disclosure has not been obtained from the

Major shareholders andcompany.

shareholding ratio
Relationship with SAR or the Asset Manager
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personnel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The Seller does not fall under the category of interested person, etc. as provided in theInvestment Trusts Act, but falls under the category of interested party prescribed in the“Rules on Transactions with Interested Parties”, which is the voluntary rules set forth by the
Asset Manager for preventing conflict of interests regarding its management of SAR’s assets.
Upon determination of the acquisition of the assets, the Asset Manager has performed
deliberation and approval in accordance with the voluntary rules.

(5) LGC-08 Matsubushi Logistics
Name

GK 29er

Location

Capital5-1-4 Toranomon, Minato-ku, Tokyo
Representative partner: Ippanshadanhoujin Seabonia
Operational executor: Takaaki Fukunaga
1. Acquisition, ownership, and disposition of beneficiary interest in trust of real estate
2. Acquisition, ownership and disposition of loan claims
3. Acquisition, ownership and disposition of corporate bonds, silent partnership interest andother securities
4. Sales, leasing, management, acquisition, ownership, disposition and use of real estate
5. All business incidental to the above
100,000 yen

Established

July 27, 2015

Representative
Main business description

Net asset
Total asset

The information is undisclosed as consent to disclosure has not been obtained from the

Major shareholders andcompany.

shareholding ratio
Relationship with SAR or the Asset Manager
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personnel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The Seller does not fall under the category of interested person, etc. as provided in theInvestment Trusts Act, but falls under the category of interested party prescribed in the“Rules on Transactions with Interested Parties”, which is the voluntary rules set forth by the
Asset Manager for preventing conflict of interests regarding its management of SAR’s assets.
Upon determination of the acquisition of the assets, the Asset Manager has performed

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

50

deliberation and approval in accordance with the voluntary rules.

5. Status of Parties Related to the Acquisition of the Property(1) OFC-10 Nihonbashi Hamacho Park Building
The asset has not been acquired from any parties who have special interests in SAR or the Asset Manager.
(2) RSC-08 Urban Park Ryokuchi Koen
Current owner, current trustee
Company name

GK SAPR5

Relationship with parties
who have special interests

The company does not fall under thePrevious owner, previous trustee
Other than the one in a relationship ofspecial interest-

category of interested person, etc. asprovided in the Investment Trusts Act, but
falls under the category of interested party
prescribed in the “Rules on Transactions
with Interested Parties” set forth by the
Asset Manager.

Acquisition background andreason, etc.

Acquired for investment management

Acquisition price(Note)-

Acquisition period

September 30, 2016--

purpose(Note) Omitted as the current owner has owned the property for over one year.

(3) RSC-09 Urban Park Koenji
Previous owner, previous trustee
Company name

GK SAPR6

Relationship with parties
who have special interests

The company does not fall under the

Before Previous owner, previous trustee
Other than the one in a relationship ofspecial interest-

category of interested person, etc. asprovided in the Investment Trusts Act, but
falls under the category of interested party
prescribed in the “Rules on Transactions
with Interested Parties” set forth by the
Asset Manager.

Acquisition background andreason, etc.

Acquired for investment management

Acquisition price

1,110,000,000 yen-

Acquisition period

September 29, 2017--

purpose(4) LGC-06 Funabashi Nishiura Logistics I
Previous owner, previous trustee
Company name
Note:

GK ViperBefore Previous owner, previous trustee
Other than the one in a relationship ofThis press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

51

special interest
Relationship with parties
who have special interests

The company does not fall under the-

category of interested person, etc. asprovided in the Investment Trusts Act, but
falls under the category of interested party
prescribed in the “Rules on Transactions
with Interested Parties” set forth by the
Asset Manager.

Acquisition background andreason, etc.

Acquired for investment management

Acquisition price(Note)-

Acquisition period

February 10, 2016--

purpose(Note) Omitted as the current owner has owned the property for over one year.

(5) LGC-07 Funabashi Nishiura Logistics II
Previous owner, previous trustee
Company name

GK ViperBefore Previous owner, previous trustee
Other than the one in a relationship ofspecial interest

Relationship with parties
who have special interests

The company does not fall under the-

category of interested person, etc. asprovided in the Investment Trusts Act, but
falls under the category of interested party
prescribed in the “Rules on Transactions
with Interested Parties” set forth by the
Asset Manager.

Acquisition background andreason, etc.

Acquired for investment management

Acquisition price(Note)-

Acquisition period

March 30, 2016--

purpose(Note) Omitted as the current owner has owned the property for over one year.

(6) LGC-08 Matsubushi Logistics
Previous owner, previous trustee
Company name

GK 29er

Before Previous owner, previous trustee
Other than the one in a relationship ofspecial interest

Relationship with parties
who have special interests

The company does not fall under the-

category of interested person, etc. asprovided in the Investment Trusts Act, but
falls under the category of interested party
prescribed in the “Rules on Transactions
with Interested Parties” set forth by the
Asset Manager.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

52

Acquisition background andreason, etc.

Acquired for investment management

Acquisition price(Note)-

Acquisition period

November 30, 2016--

purpose(Note) Omitted as the current owner has owned the property for over one year.

6. Transaction with interested person, etc.
The Transactions are not transactions with interested person, etc., as provided in the Investment Trusts Act,but each sellers in the asset acquisition other than Nihonbashi Hamacho Park Building and SACJ Godo Kaisha
as an initial purchaser (the one who had a status as a purchaser) under the sale and purchase agreement
regarding the acquisition of the Nihonbashi Hamacho Park Building fall under the category of interested party
prescribed in the “Rules on Transactions with Interested Parties,” which is the voluntary rules set forth by the
Asset Manager for preventing conflict of interests regarding its management of SAR’s assets. Upon deciding
on the acquisition of the asset, the Asset Manager has performed deliberation and approval in accordancewith the voluntary rules.
7. Overview of broker(1) OFC-10 Nihonbashi Hamacho Park Building, RSC-08 Urban Park Ryokuchi Koen, RSC-09 Urban Park Koenji,
LGC-06 Funabashi Nishiura Logistics I, LGC-07 Funabashi Nishiura Logistics II, LGC-08 Matsubushi Logistics
1) Overview of broker
Name
Location
Representative
Main business description

Jones Lang LaSalle, Inc.
2-13-10 Nagata-cho, Chiyoda-ku, Tokyo
Toshinobu Kawanishi
1. Consultant and research of real estate investment
2. Trading and bartering of real estate
Capital
195 million yen
Established
April 23, 1985
Relationship with SAR or the Asset Manager
Capital relationship
There is no capital relationship to report.
Personnel relationship

There is no personnel relationship to report.

Business relationship

There is no business relationship to report.

Related party or no

The company does not fall under the category of related party of SAR/the Asset Manager.

2) Breakdown and value of the brokerage commission
Since the consent has not been obtained from the broker, the information is not disclosed as an
undisclosed case due to unavoidable reasons.
8. Schedule for the Transactions
January 12, 2018

February 2, 2018
(Planned
Acquisition
Note:

Acquisition decided
Conclusion of a sale and purchase agreement of beneficiary interest in trust
and an agreement on transfer of contractual status
Acquisition of beneficiary interest in trust (planned)
Payment of acquisition price (planned)

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

53

Date)
Conclusion of a master lease agreement and property management agreement(planned)
9. Settlement method
The sale and purchase prices of the Transactions will be settled in lump sum on February 2, 2018. With respect
to Nihonbashi Hamacho Park Building, SACJ Godo Kaisha paid 30 million yen to the seller as earnest money on
the date of execution of the trust beneficial interest sale and purchase agreement. SAR will pay the remaining
purchase price after deduction of the said earnest money to the seller and also pay 30 million yen to SACJ Godo
Kaisha as reimbursement of the said earnest money, on the Planned Acquisition Date.
10. Future outlook
As a result of the Transactions, there will be a change in assumption described in “Financial Report for Fiscal
Period Ended July 31, 2017” announced as of September 13, 2017. Please refer to “Notice Concerning Revision
to Forecasts for Operating Results for the 4th Fiscal Period Ending January 31, 2018 and 5th Fiscal PeriodEnding July 31, 2018, and Forecasts for Operating Results and Distribution for the 6th Fiscal Period Ending
January 31, 2019” announced as of today for further details.
<Reference Materials>
Reference Material 1:
Reference Material 2:
Reference Material 3:

Portfolio list after the Transactions (as of February 2, 2018)
Summary of earthquake risk analysis
Location maps/photos of exterior of properties<Other Press Releases Announced as of Today>- Notice Concerning Issuance of New Investment Units and Secondary Offering of Investment Units- Notice Concerning Revision to Forecasts for Operating Results for the 4th Fiscal Period Ending January 31, 2018
and 5th Fiscal Period Ending July 31, 2018, and Forecasts for Operating Results and Distribution for the 6th
Fiscal Period Ending January 31, 2019- Notice Concerning Debt Financing- Supplemental Material on Press Releases (acquisition of properties through public offering) Announced as ofToday- Notice Concerning Execution of Agreement on the Preferential Negotiation on HAKUSAN HOUSE* This material is distributed to the press club of the Tokyo Stock Exchange (Kabuto Club), the pressclub of the Ministry of Land, Infrastructure, Transport and Tourism, and the press club forconstruction trade publications of the Ministry of Land, Infrastructure, Transport and Tourism.
* Star Asia Investment Corporation website address: http://starasia-reit.com/en/

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

54

Reference material 1

Portfolio list after the Transactions (as of February 2, 2018)<Real Estate, etc.>

Property no.

Location

Property name

OFC-01

Minami-Azabu Shibuya Building

OFC-03

Honmachibashi Tower

OFC-04

Nishi-Shinjuku Matsuya Building

OFC-05(Note 1)

Minato-ku, Tokyo(Planned)

Real estate

acquisition

appraisal

Investment

price

value

ratio (%)

(million yen)(million yen)

(Note 4)(Note 2)

(Note 3)

2,973

3,070

3.5

6,065

6,940

7.0

Shibuya-ku, Tokyo

1,763

2,370

2.0

Alphabet Seven

Minato-ku, Tokyo

1,725

2,330

2.0

OFC-06

Shibuya MK Building

Shibuya-ku, Tokyo

2,042

2,810

2.4

OFC-07

Hakata-eki Higashi 113 Building

1,885

2,020

2.2

OFC-08Asahi Building

6,320

6,720

7.3

2,286

2,410

2.7

1,450

1,520

1.7

26,50930,19030.8

Chuo-ku, Osaka-shi,
Osaka

Hakata-ku, Fukuoka-shi,
Fukuoka
Kanagawa-ku,
Yokohama-shi,
Kanagawa

OFC-09OFC-10Hakata-eki East Place
Nihonbashi Hamacho Park
Building

Hakata-ku, Fukuoka-shi,
Fukuoka
Chuo-ku, Tokyo
Office subtotal

RSC-01

Urban Park Azabujuban

Minato-ku, Tokyo

2,045

2,170

2.4

RSC-02

Urban Park Daikanyama

Shibuya-ku, Tokyo

6,315

7,310

7.3

2,528

2,590

2.9

1,490

1,610

1.7

Kohoku-ku,
RSC-04

Urban Park Shin-Yokohama

Yokohama-shi,
Kanagawa
Naniwa-ku, Osaka-shi,

RSC-05

Urban Park Namba

RSC-06

Urban Park Gokokuji

Toshima-ku, Tokyo

1,460

1,510

1.7

RSC-07

Urban Park Kashiwa

Kashiwa-shi, Chiba

1,186

1,190

1.4

RSC-08

Urban Park Ryokuchi Koen

Suita-shi, Osaka

1,550

1,570

1.8

RSC-09Urban Park Koenji

Suginami-ku, Tokyo

Osaka

Residence subtotal
LGC-01

Iwatsuki Logistics

Iwatsuki-ku, Saitama-shi,
Saitama

1,167

1,170

1.4

17,741

19,120

20.6

6,942

7,010

8.1

3,560

3,950

4.1

Kanagawa-ku,
LGC-02

Yokohama Logistics

Yokohama-shi,
Kanagawa

Note:This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

55

LGC-03

Funabashi Logistics

Funabashi-shi, Chiba

7,875

8,380

9.1

LGC-04

Baraki Logistics

Ichikawa-shi, Chiba

4,700

4,890

5.5

LGC-05Tokorozawa Logistics

Tokorozawa-shi, Saitama

1,300

1,400

1.5

LGC-06

Funabashi Nishiura Logistics I

Funabashi-shi, Chiba

3,000

3,010

3.5

LGC-07

Funabashi Nishiura Logistics II

Funabashi-shi, Chiba

821

833

1.0

LGC-08

Matsubushi Logistics

2,755

2,850

3.2

30,95332,323

36.0

2,069

2,300

2.4

1,750

1,750

2.0

3,827

3,890

4.4

3,248

3,270

3.8

Hotel subtotal

10,894

11,210

12.6

Real Estate etc. Total

86,097

92,843100.0

Kitakatsushika-gun,
Saitama
Logistics subtotal

HTL-01R&B Hotel Umeda East

HTL-02

Smile Hotel Namba

HTL-03

BEST WESTERN Tokyo Nishikasai

Kita-ku, Osaka-shi,
Osaka
Naniwa-ku, Osaka-shi,
Osaka
Edogawa-ku, Tokyo
Tsurumi-ku,

HTL-04

BEST WESTERN Yokohama

Yokohama-shi,
Kanagawa(Note 1) ”Location” indicates the minimum independent administrative district of which each asset held by SAR as of today (the“Existing Assets (real estate, etc.)”) and assets to be acquired is located except for mezzanine loan debt described in the<Mezzanine> below.
(Note 2) “Acquisition price” indicates, except for Minami-Azabu Shibuya Building, the sale and purchase price stated in each saleand purchase contract for Existing Assets (real estate, etc.), and “planned acquisition price” indicates the planned saleand purchase price stated in the sale and purchase agreement for assets to be acquired, rounded to the nearest million
yen. The sale and purchase price or the planned sale and purchase price does not include consumption tax, local
consumption tax and various expenses required for the acquisition. As to Minami-Azabu Shibuya Building, since pricefor each property is not set in the sale and purchase agreement, the total sale and purchase price of the property is
divided proportionally based on the ratio of appraisal value of the property at the time of acquisition and indicated as“(planned) acquisition price.”(Note 3) Appraisals are entrusted to Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute and The Tanizawa Sogo
Appraisal Co., Ltd., and “real estate appraisal values” is the opinions of value stated in the real estate appraisal reportwith July 31, 2017 as the date of valuation for Existing Assets (real estate, etc.), November 1, 2017 as the date ofvaluation for assets to be acquired, each rounded to the nearest million yen.
(Note 4) “Investment ratio” is the ratio of (planned) acquisition price for each Existing Assets (real estate, etc.) /assets to beacquired to the total of (planned) acquisition prices of each Existing Assets (real estate, etc.) /assets to be acquired.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

56

<Mezzanine>
Acquisition
Asset no. Asset type

Asset name (overview)

Investment

Investment

priceInterest

ratio (%)

(million

rate

yen)

(Note 3)(Note 1)

Acquisition
date(Note 2)

ratio to theentireportfolio(%)(Note 4)

The 1st Unsecured Subordinate

Mezzanine loan debt

MEZ-01

CorporatebondBonds issued by the Haneda Hotel
Development GK (Series A)

54.5

400

Base rate(Note 6)(Note 5)

(Name: Star Asia Mezzanine Loan

+5.0%

October 31,
2017

0.5

Debt Investment Series 1)
Subordinate beneficiary interest oftrust with loan claims
Beneficiary
MEZ-02interest in
trust(non-recourse loan) to the GK

Base rate

Japan B Asset as main asset intrust, which holds Sasazuka South

45.5

334

(Note 7)

+5.0%

Building as collateral asset (Name:

December22, 2017

0.4Star Asia Mezzanine Loan Debt
Investment Series 2)
Mezzanine loan debt Total

100.0

734

－

－

0.8

(Note 1) “Share of investment” is the acquisition price expressed as a percentage of the sum total of mezzanine loan debt.
(Note 2) “Acquisition price” is the sale and purchase price in the bond transfer agreement and the sale price of beneficiaryinterest in the beneficiary interest transfer agreement (each do not include transfer-related costs), each rounded down
to the nearest million yen.
(Note 3) “Interest rate” includes the dividend from the invested mezzanine loan debt.
(Note 4) “Investment ratio to the entire portfolio” is the acquisition price of each mezzanine loan debt as a percentage of thesum total of (scheduled) acquisition price of the portfolio (including Existing Assets (real estate, etc.) and assets to beacquired) including the mezzanine loan debt after the Transactions.
(Note 5) “400” means 400 million yen of total issued bonds amount of 701 million yen.
(Note 6) Base rate is JBA 3-month JPY TIBOR. The Japanese yen TIBOR can be confirmed on the website of the JBA TIBOR
Administration (http://www.jbatibor.or.jp/english/rate/). The same applies hereinafter. For each interest calculation
period, the rate announced at 11 a.m. (Tokyo time) two business days prior to the last day of the previous calculation
period of the relevant calculation period (the first date is two business days prior to the closing date of the senior loan
which will be made closing with the payment of the bond) will be applied as the base rate.
(Note 7) Base rate is JBA 3-month JPY TIBOR. For each interest calculation period, the rate announced at 11 a.m. (Tokyo time)
two business days prior to the last day of the previous calculation period of the relevant calculation period (the firstdate is December 20, 2017) will be applied as the base rate.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

57

Reference Material 2
Type

OfficeResidence

Logistics

Hotel

Note:

Summary of earthquake risk analysis

Property
no.

PML
(%)

Property name

OFC-01

Minami-Azabu Shibuya Building

12.6

OFC-03

Honmachibashi Tower

2.7

OFC-04

Nishi-Shinjuku Matsuya Building

12.2

OFC-05Alphabet Seven

7.8

OFC-06

Shibuya MK Building

13.1

OFC-07

Hakata-eki Higashi 113 Building

7.1

OFC-08Asahi Building

4.8

OFC-09Hakata-eki East Place

7.3

OFC-10Nihonbashi Hamacho Park Building

12.1

RSC-01

Urban Park Azabujuban

7.2

RSC-02

Urban Park Daikanyama

Existing bldg.: 12.7
Bldg. A: 10.2
Bldg. B: 7.9

RSC-04

Urban Park Shin-Yokohama

14.5

RSC-05

Urban Park Namba

13.2

RSC-06

Urban Park Gokokuji

9.2

RSC-07

Urban Park Kashiwa

10.0

RSC-08

Urban Park Ryokuchi Koen

RSC-09Urban Park Koenji

LGC-01

Iwatsuki Logistics

LGC-02

Yokohama Logistics

Apartment house: 8.8
Parking bldg.: 4.0
A bldg.: 6.7
B bldg.: 6.9
12.2
10.8
Bldg. 1-A: 13.9
Bldg. 1-B: 14.4
Bldg. 2: 11.1
10.9

LGC-03

Funabashi Logistics

LGC-04

Baraki Logistics

LGC-05Tokorozawa Logistics

LGC-06

Funabashi Nishiura Logistics I

LGC-07

Funabashi Nishiura Logistics II

LGC-08

Matsubushi Logistics

Warehouse: 9.7
Office: 3.8
Warehouse: 8.8
Office: 13.5
Office: 14.3
Factory: 15.9
Warehouse: 14.0
9.8

HTL-01R&B Hotel Umeda East

11.4

HTL-02

Smile Hotel Namba

12.3

HTL-03

BEST WESTERN Tokyo Nishikasai

13.3

HTL-04

BEST WESTERN Yokohama

7.9

Entire portfolio (29 properties) (Note)

3.27

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

58

(Note) The figure in the entire portfolio column is the PML for the entire portfolio of the Existing Assets (real estate, etc.)/assets to be acquired (portfolio PML) based on “portfolio earthquake risk evaluation report” prepared by Deloitte
Tohmatsu Property Risk Solution Co., Ltd. dated December 2017.

Note:

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

59

Reference Material 3
1.

Note:

Location maps/photos of exterior of properties
OFC-10Nihonbashi Hamacho Park BuildingThis press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

60

2.

Note:

RSC-08

Urban Park Ryokuchi Koen

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

61

3.

Note:

RSC-09Urban Park Koenji

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

62

4.

Note:

LGC-06

Funabashi Nishiura Logistics I

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

63

5.

Note:

LGC-07

Funabashi Nishiura Logistics II

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

64

6.

Note:

LGC-08

Matsubushi Logistics

This press release does not in any way constitute any part of an offering of securities for investment. Thispress release has been prepared for the purpose of announcing to the public certain matters relating to
the acquisition of real estate beneficiary interests in trust and lease contract with new tennants, and not
for the purpose of soliciting any investment, within or outside of Japan. Additionally, this press release is
not an offer of securities for sale in the United States. The securities referred to herein have not been, andwill not be registered under the United States Securities Act of 1933, as amended (the “Securities Act”)
and may not be offered or sold in the United States absent registration or an exemption from registration
under the Securities Act. No offering or sale of securities in the United States will be made in connection
with the above-mentioned transactions. This press release is not for publication, distribution or release,
directly or indirectly in or into the United States of America.

65