August 5, 2016
To All Concerned Parties
REIT Securities Issuer
3-8-11 Kudan Minami, Chiyoda-ku, Tokyo
Sakura Sogo REIT Investment Corporation
Representative: Makoto Muranaka,
Executive Director:(Securities Code 3473)
Asset Management Company:
Sakura Real Estate Funds Management, Inc.
Representative: Makoto Muranaka,
Representative Director andPresident
Inquiries:
Mayumi Kobiki,
Chief Financial Officer
Tel:+81-3-6272-6608

Notice Concerning Operating Forecasts for the Fiscal Periods
Ending February 2017 and August 2017
Sakura Sogo REIT (hereinafter the “Investment Corporation”) announces its operating forecasts for the
first fiscal period (from April 1, 2016 to February 28, 2017) and for the second fiscal period (from March
1, 2017 to August 31, 2017) as follows.

Fiscal period ending
February 2017
(First Fiscal Period)
Fiscal period ending
August 2017
(Second Fiscal Period)

Distributions
per Unit(Yen)

Distributions
in Excess of
Earnings
per Unit(Yen)

Operatingrevenue(mm yen)Operatingincome(mm yen)Ordinary
income(mm yen)Net
income(mm yen)

2,291

905

95

95

278

0

2,418

1,085

951

951

2,772

0

(excluding
Distributions in
Excess ofEarnings)(Reference) Fiscal period ending February 2017: Number of investment units forecast to be issued: 343,401 units,
forecast net income per unit: 278 yen
Fiscal period ending August 2017: Number of investment units forecast to be issued: 343,401 units, forecast
net income per unit: 2,772(Note 1) Fiscal periods of the Investment Corporation are from March 1 to August 31 and from September 1 to theend of February of the following year for every year. However, the first fiscal period is from April 1, 2016
(date of establishment) to February 28, 2017. The substantial first fiscal period is from September 9, 2016,
which is a planned date for property acquisition, to February 28, 2017 (173 days).
(Note 2) The above forecast figures are calculated assuming the issue price of new investment units as 100,000 yen
per unit.
(Note 3) The operating forecasts for the fiscal periods ending February 2017 and August 2017 are figures based on
currently available information calculated based on the assumptions described in the attachment“Assumptions for Operating Forecasts for the First Fiscal Period Ending February 2017 and the Second
Fiscal Period Ending August 2017.” The actual operating revenue, operating income, ordinary income, net
Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

1

income and distributions per unit excluding distributions in excess of earnings are subject to change as aresult of deviation from assumptions caused by factors such as additional acquisition/disposition of realestate, etc., fluctuations in rent income accompanying changes of lessees, etc., changes in management
environment including occurrence of unexpected repair, etc., fluctuations in interest rates, actual number of
new investment units issued and their issue price determined, and additional issuance of new investment
units in the future. In addition, the Investment Corporation does not guarantee any actual cash distribution
amount by announcing the forecast figures.
(Note 4) The forecasts may be subject to revision when a disparity beyond a certain degree is expected between
the above forecasts and actual figures.
(Note 5) The scheduled date for the listing of the Investment Corporation’s investment units on the Real Estate
Investment Trust Securities Market of the Tokyo Stock Exchange is September 8, 2016.
(Note 6) Amounts are rounded down to the nearest specified unit.

This material is to be distributed to the Kabuto Club, the Ministry of Land, Infrastructure, Transport
and Tourism Press Club, and the Ministry of Land, Infrastructure, Transport and Tourism Press Clubfor Construction Purposes.

Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

2

[Attachment]
Assumptions for Operating Forecasts for the First Fiscal Period Ending February 2017 and theSecond Fiscal Period Ending August 2017
Item

Assumptions


Calculation periodInvestment AssetsOperating revenueOperatingexpenses

Fiscal Period Ending February 2017 (First Fiscal Period) (From April 1, 2016 to
February 28, 2017) (334 days)
Fiscal Period Ending August 2017 (Second Fiscal Period) (From March 1, 2017
to August 31, 2017) (184 days)
It is assumed that the real estate trust beneficiary interests of the properties (18properties in total) to be newly acquired after the issuance of new investment
units (hereinafter “Assets to be Acquired”) which was resolved at the meeting of
the Board of Directors of the Investment Corporation held today will be acquiredon September 9, 2016, and that there will be no change (acquisition of new
properties, disposition of portfolio properties, etc.) to the investment assets
through to the end of the fiscal period ending August 2017.
Change may arise in the event of acquisition of new properties other than the
Assets to be Acquired or disposition of portfolio properties.
Rental revenues from the Assets to be Acquired are calculated based on the leaseagreements provided by the current beneficial owners, past tenants, market
trends, etc., and contents of lease agreements which will take effect on theplanned acquisition date, while taking into account assumed occupancy rates andrent fluctuation projection, based on forecasts of move-ins and outs of tenants
and rent level after the acquisition.
The forecast of operating revenues is made on the assumption that no tenants
will delay or default rental payments.
The main items of operating expenses are as follows (rounded down to thenearest specified unit; the same shall apply hereinafter):First Fiscal Period
Second Fiscal Period
Expenses related to
963 million yen
1,125 million yen
leasing business[Total]Management fees
279 million yen
296 million yen
Of which:
201 million yen
214 million yen
Maintenance andmanagement fee
Of which: Property
77 million yen
82 million yen
management fee
Repair expenses
17 million yen
18 million yen
Taxes and dues
67 million yen
202 million yen
Depreciation
226 million yen
245 million yen
Other than expenses
423 million yen
207 million yen
related to leasing
business [Total]
Asset management
108 million yen
127 million yen
fee
Of expenses related to the leasing business of the Assets to be Acquired, which
are the main operating expenses, expenses other than depreciation arecalculated on a historical data basis based on information provided by thecurrent beneficial owners and by reflecting variable factors.

Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

3







Depreciation calculated using the straight-line method, including incidental
expenses, are projected to be 226 million yen for the fiscal period ending
February 2017 and 245 million yen for the fiscal period ending August 2017
respectively.
Upon transactions of real estate and other properties, it is a general practice tocalculate and reimburse the pro rata portion of fixed property taxes, city planningtaxes and other public charges based on the number of days of ownership tothe current owner and settle them at the time of acquisition. However, in caseof the Investment Corporation, the settled amount is included in the acquisition
cost and thus is not recorded as expenses in the fiscal period of the acquisition.
Therefore, fixed property taxes, city planning taxes and other public charges
charged in 2016 for the Assets to be Acquired will not be recorded as operating
expenses, but part of the fixed property taxes, etc. to be charged in 2017 will berecorded as operating expenses in the fiscal period ending February 2017 andthe fiscal period ending August 2017, for the amount corresponding to the period
from January 1, 2017 to the end of the calculation period of the former fiscal
period and the amount corresponding to the calculation period of the latter fiscal
period, respectively. As for the Assets to be Acquired, the total amount of fixed
property taxes, city planning taxes and other public charges to be included in
the acquisition cost is projected to be 126 million yen. Regarding repair
expenses, the asset management company, Sakura Real Estate Funds
Management, Inc. (hereinafter the “Asset Management Company”) records theamount assumed to be necessary in each fiscal period for each property as
expenses. However, due to reasons such as an increase in repair expenses oradditional repairs that may occur from unforeseeable causes, the amount
generally varies considerably depending on the fiscal year, and because it is
not an amount that arises periodically, each fiscal period’s repair expenses may
differ materially from the forecast amount.
Of the fees payable to the Asset Management Company, an agreement has
been reached for the NOI-linked fee Asset Management Fee (2)* that the fee
rate shall be 0% until the fiscal period ending August 2017 on the agreementthat it shall be within the upper limit provided in the Articles of Incorporation of
the Investment Corporation. Accordingly, the asset management fee for the
fiscal period ending February 2017 and the fiscal period ending August 2017 islower than the asset management fee for the fiscal period ending February 2018
and subsequent fiscal periods. The amount of difference between the asset
management fee for the fiscal period ending February 2017 and the fiscal period
ending August 2017 that would be payable if the asset management fee were
to be at the fee rate that would apply to the fiscal period ending February 2018
and subsequent fiscal periods and based on the other assumptions presented
herein (estimate only) and the asset management fee underlying the earnings
forecast for each fiscal period would be approximately 46 million yen for the
fiscal period ending February 2017 and approximately 46 million yen for the
fiscal period ending August 2017.
* Asset Management Fee (2) = The amount arrived at when NOI (the amountarrived at when the total of expenses related to the leasing business (excluding
depreciation and loss on retirement of non-current assets) is subtracted fromthe total of leasing business revenue on the statement of income for the relevant
fiscal period of the Investment Corporation) is multiplied by the fee rate
separately agreed upon between the Investment Corporation and the AssetManagement Company of no more than 3%.

Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

4Non-operating
expenses
Debt financing







Investment unitsDistribution per Unit (excluding
Distributions in
Excess of Earnings)

Deferred organization expenses of 59 million yen and expenses associated withissuance of new investment units and listing of investment units of 419 million
yen are projected as one-time expenses for the fiscal period ending February
2017. The deferred organization expenses and expenses associated withissuance of new investment units and listing of investment units are scheduled
to be amortized in a lump sum.
Interest expenses and other borrowing related expenses are projected to be
330 million yen for the fiscal period ending February 2017 and 133 million yen
for the fiscal period ending August 2017.
The total of interest-bearing liabilities outstanding is assumed to be 27,000
million yen at the end of the fiscal period ending February 2017 and 26,000
million yen at the end of the fiscal period ending August 2017.
It is assumed that borrowings of 28,000 million yen in total will be made on
September 8, 2016 from the qualified institutional investors defined under Article
2 Paragraph 3 item 1 of Financial Instruments and Exchange Act, and that partof the borrowings will be repaid in the fiscal period ending February 2017 using
the proceeds from the issuance of new investment units through third-party
allotment (upper limit of 10,400 units) described in “Investment units” below.
Regarding the expected refund of consumption taxes associated with theacquisition of the Assets to be Acquired and payment of various expenses in
the fiscal period ending August 2017, it is assumed that the refund will be usedas the source of funds for repayment of borrowings in the amount of 1,000
million yen during the fiscal period ending August 2017.
LTV at end of the fiscal period ending February 2017 (1st fiscal period) is
projected to be about 42.7% and LTV at the end of the fiscal period ending
August 2017 (2nd fiscal period) is projected to be about 41.2%.
The following formula is used in the calculation of LTV.
LTV = Total interest-bearing liabilities ÷ Total assets × 100
LTV may differ depending on the number and the issue amount of the newinvestment units to be issued.
It is assumed that, in addition to 1,001 investment units issued and outstanding
as of today, all of the investment units scheduled to be newly issued (total of343,401 units maximum) will be issued through public offering (332,000 units)
and third-party allotment (maximum of 10,400 units) that were resolved at themeeting of the Board of Directors of the Investment Corporation held today.
It is assumed that, except for the above, there will be no changes in the numberof investment units due to issuance of new investment units through to the endof the fiscal period ending August 2017.
Distribution per unit (excluding distribution in excess of earnings) is calculatedusing the expected number of investment units issued and outstanding at theend of the fiscal period ending February 2017 and the fiscal period ending
August 2017 (343,401 units), which includes the abovementioned maximum
number of investment units to be newly issued (a total of 10,400 units).
Distribution per unit (excluding distribution in excess of earnings) is calculatedon the assumption that distributions will be made in accordance with the cash
distribution policy provided in the Articles of Incorporation of the Investment
Corporation.

Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

5





Distributions in
Excess ofEarnings per
Unit




Other


Distribution per unit (excluding distribution in excess of earnings) may vary due
to various factors, including fluctuations in leasing revenue accompanying
changes in assets under management, changes in tenants and other events,
occurrence of unexpected repairs, etc.
Distribution per unit for the first fiscal period is projected to be 278 yen due tothe effect of one-time non-operating expenses such as deferred organization
expenses accompanying establishment of the Investment Corporation and
expenses associated with issuance of new investment units and listing ofinvestment units as mentioned above. Distribution per unit for the second fiscal
period is projected to be 2,772 yen due to expensing of fixed property taxes andcity planning taxes in the second fiscal period and onward.
The Articles of Incorporation of the Investment Corporation enable it to provide
for distribution in excess of earnings, but considering the ratio of capital
expenditures to depreciation and in an aim to conduct conservative financial
management, no distribution in excess of earnings is scheduled to be
implemented for the time being.
Forecasts are based on the assumption there will be no material changes in laws,
regulations, taxation systems, accounting standards, public listing requirements
or rules of the investment trust association that could impact the forecastspresented herein.
Forecasts are based on the assumption there will be no unforeseen materialchanges in general economic and real estate market conditions, etc.

Disclaimer: This press release is for public announcement in regards to the operating forecasts for the fiscal periods ending February 2017 andAugust 2017 of the Investment Corporation, and has not been prepared for the purpose of solicitation of investment. Investors shallalways refer to the prospectus for issuance of new investment units and for notification of secondary offering of investment units, andamendments thereto, prepared by the Investment Corporation, and undertake any investment in their own decision.
Furthermore, this press release does not constitute an offer of securities in the United States. The investment units have not beenregistered under the United States Securities Act of 1933. The securities may not be offered or sold in the United States absent
registration or an exemption from registration under the United States Securities Act of 1933. In case securities are to be publicly offeredin the United States, prospectus written in English prepared based on the United States Securities Act of 1933 shall be used. In such acase, investors will be able to obtain the English prospectus from the Investment Corporation or the selling agency, and detailed
information on the Investment Corporation and its executive team as well as the financial statements will be provided in the English
prospectus. The securities referred to in this press release will not be publicly offered or sold in the United States.

6