As of December 20, 2019

Hopeful future
for Japan
Nippon Healthcare
Investment Corporation
Presentation Material for
The 9th Fiscal Period Ended October 2018
Securities code ： 3308

Contents
Disclaimer

Section 3

Topics for 9th Fiscal Period

Section 1

Portfolio List (as of December 20, 2018)17

Status of Portfolio: Change in Occupancy Rates

18

5

Remaining Lease Contract Period of Each Property

19

Status of Portfolio: Fee Systems of Facilities

20

6

Status of Portfolio (as of December 20, 2018)21

7

Portfolio Resident Attributes (as of December 20, 2018)22

Operating Results for 9th Fiscal Period
Operating Results for 9th Fiscal Period
Forecast of Operating Results for 10th Fiscal Period
and 11th Fiscal Period
Distribution per Unit

Portfolio Analysis

3

Section 2

Section 4External Growth

Initiatives for ESG

Property Acquired in 10th Fiscal Period

9

Introduction of New Operator

10

Effective Utilization of Cash on Hand

11

Change in Asset Size

12

Pipeline Development

13

Portfolio Map (as of December 20, 2018)14

Introduction of Operators (as of December 20, 2018)15

Initiatives for ESG (Environment)
Initiatives for ESG (Social)
Initiatives for ESG (Governance)

24
25
27

Section 5
Financial Status
Status of Interest-Bearing Liabilities(as of October 31, 2018)30

Overview of the Unitholder Benefits Program

31

Appendix

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

1Disclaimer

This material is solely for the purpose of providing information and is not intended for the purpose of offering or soliciting
investment, or as a recommendation to purchase or sell any specific product. Please refer any inquiries on potential
purchases of the investment units of Nippon Healthcare Investment Corporation to a securities dealer.
This document is not intended to provide information to meet the requirements of Japan’s new Financial Instruments andExchange Act or Act on Investment Trusts and Investment Corporations, or any associated cabinet orders, cabinet officeordinances, rules, or any rules governing companies listed on the Tokyo Stock Exchange, or any other applicable rules,
nor is it a disclosure document or statement of financial performance prepared in accordance with the provisions of anyof the foregoing.
This document contains forward-looking statements. However, these forward-looking statements are based on certain
assumptions and judgments made using currently available information, and there are a number of known and unknown
risks and uncertainties. These forward-looking statements are not a guarantee of future performance or management
results of Nippon Healthcare Investment Corporation, and actual results may materially differ from any explicit or implicit
forecasts contained herein.
Although the information contained in this document is the best available at the time of publication, no assurances can begiven regarding the accuracy and certainty of this information. The content of this document may be modified orwithdrawn without prior notice.
Reproduction or use of the contents included in this document without prior approval is prohibited.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

22

Topics for 9th Fiscal Period (Ended October 2018)█ <External growth>Acquired first portfolio property located in Tokyo (December 20, 2018)“Irise Komae Bettei” (Acquisition price: Approx. 390 million yen, 30% quasi-co-ownership interest)█ < Management status >

Average occupancy rate for the entire portfolio at the end of the 9th Fiscal Period remained stable at 90.6% (down
0.6% from the 8th Fiscal Period)Operators’ rent-paying capacity was 1.6, up 0.1 percentage point from the 8th Fiscal Period█ < Financial status >Number of lender financial institutions increased (End of 8th Fiscal Period: 7 banks → End of 9th Fiscal Period : 8banks)



LTV was 46.5%, ratio of fixed rates was 100.0% and average remaining loan period was 2.5 years

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

3Section 1 Operating Results

for the 9th Fiscal Period

Operating Results for 9th Fiscal Period
Actual results for the 9th Fiscal Period
8th FP(ended Apr. 2018)(results)(unit: million yen)
9th FP(ended Oct. 2018)(results)

Difference

Factor

22
697
424
100
198
273
1
27
21
247
246

22
697
425
90
199
271
0
28
21
244
243

-0
+1
-9
+1
-1
-1
+0
+0
-3
-3

74,632

74,632

-

4,163

4,130

- 33

3,303

3,260

- 43

860

870

+ 10

Depreciation per unit (yen)

2,657

2,674

Ratio of distribution in excess of earnings to
depreciation per unit

32.4%

32.5%

Number of properties owned at end of the fiscal period
Operating revenue
Operating expenses
Property-related expense (excluding depreciation)
Depreciation
Operating income
Non-operating revenue
Non-operating expense
Interest expense
Ordinary income
Net income
Number of investment units issued and outstandingat the end of the fiscal period (units)
Distribution per unit (yen)(including distribution in excess of earnings)
Distribution per unit (excluding distribution inexcess of earnings)
Distribution per unit in excess of earnings

Increase

Decrease

Item
Asset Custody and Admin. Service Fees
 Depreciation

Repair Cost+

6million yen+

1million yen-

9million yen(Reference)

Comparison of forecast and actual results for 9th Fiscal Period(unit: million yen)

Number of properties owned at end of the fiscal period
Operating revenue
Operating expenses
Net income
Distribution per unit (yen)(including distribution in excess of earnings)
Distribution per unit
(excluding distribution in excess of earnings)
Distribution per unit (in excess of earnings)

9th FP (ended Oct. 2018)(forecast)(Disclosed as of
18 Jun. 2018)

9th FP(ended Oct. 2018)(results)

22
697
427
241

22
697
425
243

-0
-1
+2

4,100

4,130

+ 30

3,230

3,260

+ 30

870

870

+0

Difference-This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

5Forecast of Operating Results for 10th Fiscal Period and 11th Fiscal Period
Factor

Forecast of the 10th fiscal period

Revenue (rents and common area fees)from 1 property acquired during the fiscal
period+7million yen

Repair Cost Other Fees++

5million yen

Asset Custody and Admin. Service Fees Asset Management Fee-

6million yen(unit: million yen)
Increase

10th FP(ending Apr. 2019)(forecast)Difference fromthe 9th FP
Increase

23+1

Operating revenue

705

+7

Operating expenses

424

-0

Property-related expenses (excluding depreciation)

94+4

Depreciation

203

+3

Operating income

280

+8

Non-operating revenue--0

Non-operating expense

28+0

Number of properties ow ned at end of the fiscal period

Item

Decrease

4million yen

4million yen

10th FP(ending Apr. 2019)(forecast)
Number of investment units issued and outstandingat the end of the fiscal period (units)
Distribution per unit (yen)(including distribution in excess of earnings)
Distribution per unit (excluding distribution in excess ofearnings)

74,632

-

4,230

+100

3,360

+100

870

-

Distribution per unit in excess of earnings

21+0

Ordinary income

251

+7

(Reference)

Net income

250

+7

Depreciation per unit (yen)2,724

Ratio of distribution in excess of earnings to depreciation
per unit

31.9%Interest expense

Forecast of the 11th fiscal period(unit: million yen)
11th FP(ending Oct. 2019)(forecast)
Number of properties ow ned at end of the fiscal period

Item

Difference fromthe 10th FP

23

FactorIncrease-

Operating revenue

707

+2

Operating expenses

427

+2

Property-related expenses (excluding depreciation)

94-0

Depreciation

204

+1

Operating income

280

-0

Non-operating revenue--

Non-operating expense

29+0Interest expense

22+0

Ordinary income

251

-0

Net income

250

-0

Increase

Difference fromthe 9th FP

Full-year contribution of revenue (rents andcommon area fees) from 1 property+
acquired during the previous fiscal period

Tax and public dues (general andadministrative expense) Depreciation
++2million yen

1million yen
1million yen

11th FP(ending Oct. 2019)(forecast)
Number of investment units issued and outstandingat the end of the fiscal period (units)
Distribution per unit (yen)(including distribution in excess of earnings)
Distribution per unit (excluding distribution in excess ofearnings)

Distribution per unit in excess of earnings

Difference fromthe 10th FP

74,632

-

4,230

-

3,350

-10

880

+10

(Reference)
Depreciation per unit (yen)2,746

Ratio of distribution in excess of earnings to depreciation
per unit

32.0%This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

6

Distribution per Unit
Distribution per Unit
（YEN）

4,067

4,295

4,106

4,143

4,124

4,163

4,130

4,230

4,230

3,471
Distribution
in excessofEarnings
per unit

Distribution
per unit(excluding
distribution inexcess of
earnings)

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

7Section 2

External GrowthEffective Utilization of Cash on Hand
Utilization methods of cash on handOf various options for utilizing cash on hand (property acquisition, repayment of loans, acquisition of own investment units,
distributions in excess of earnings, etc.), acquired a property which can continue to contribute most to distribution as well as
distributions in excess of earnings in previous fiscal periods.
Assumed scenario

Specific measures

Effect/impact

Distributions inexcess of earnings

Implement distributions in excess of earnings every accounting
period with an upper limit of 40% of depreciation

Contribution to stable
distribution

Acquisition of
new properties Allocate fund for property acquisition since cash on handaccumulates by around 100 million yen every fiscal period
 Consider continuous acquisition from bridge funds inaccordance with the amount of cash on handContinuous contribution to
distribution

Repayment ofloans

Reduce debt cost through repayment of interest-bearing liabilities

Acquisition of own
investment units

Seek capital efficiency through acquisition/retirement of own
investment units

Low cost cut effectWill lead to a decline ofliquidity due to a decrease in
the number of issued
investment units

We will aim for maximization of unitholders’ value through efficient use of funds.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

9

Property Acquired in 10th Fiscal Period (Ending April 2019)
Irise Komae Bettei (partial acquisition)

Increase rate of the number of people requiring support or nursing care in Komae City

Acquisition price: 394.5 million yen (Acquisition date: December 20, 2018, 30% quasico-ownership interest)
Operator: HITOWA Care Service Co., Ltd.
Facility type: Fee-based homes for the elderly with nursing care

The number of people requiring support or nursing care in Komae City was 3,778 in 2017,and is estimated to be 4,470 in 2020 (up 18% form 2017) and 5,296 in 2025 (up 40% from2017).
As for the entire Tokyo, the number of people requiring support or nursing care was591,631 in 2017 and is estimated to be 748,703 in 2025 (up 27% from 2017). Thus theincrease rate is greater for Komae City.

＜Number of people requiring support ornursing care in Komae City＞

Up 40%(Up 27% for Tokyo on average)

Estimate

First acquisition of a property located in highly populated Tokyo
Location

1-32-5 Higashi-nogawa,
Komae-shi, Tokyo

Appraisal value

399 million yen(Note)

Structure/ floors

RC/3F

Appraisal NOI
yield

4.6%

Quasi-co-owner

GK DA Healthcare 2

Area2,475.48m2

Number of rooms

59

Total floor area

2,016.73㎡

Occupancy rate

98.3% (Written explanationof important matter as ofJuly 1, 2018)

Construction
completion

January 2017

(Note) As of December 1, 2018. Calculated the amount for the 30% quasi-co-ownership interest.

(Source) Website of Komae City

(Reference) ＜Estimated population for Komae City＞

Site Features
2020
2025
2017
Various flowers are planted in the facility site. With cherry blossoms running along(estimate) (estimate)Nogawa Green Space in the vicinity, a pleasant environment has been created in the
Total population (persons)81,63381,81381,566
community along with the Kitami Fureai Park on the east side of the Property.
Elderly population (persons)
19,67020,064
20,495
Area Features
Rate of population 65 years or older
24.1%
24.5%
25.1%
The area within a 3-km radius of the Property spans all of Komae City and part of
Chofu City and part of Setagaya Ward. The number of elderly people aged 75 years
Number of people requiring
3,778
4,470
5,296
or over is 122,000, accounting for 32.6% of the total population of the two cities andsupport/nursing care (persons)
one ward. The number of elderly people aged 75 or over in Komae City is expected to
Ratio against total population
4.6%
5.5%
6.5%
increase to 12,400 in 2025 from 10,600 in 2018.
Property Features
The Property is a relatively new facility, completed in 2017, and has private rooms of
mainly around 18 m², the standard room size for facilities with nursing care. The
This document
is notmaterial
disclosedin compliancewith the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
rooms areequippedwitha sink andtoilet.
NHI advises readers to make investment decisions at their own judgment.
10Introduction of New Operator
Number of
facilities

Number of
rooms

48

2,836

52

3,276

Elderly housing with supportive services

9

614

5

81

114

6,807

Facilities under management
Daily Life Long-Term Care Admitted to aSpecified Facility
Residential-type fee-based homes forthe elderly
Company nameHITOWA Care Service Co., Ltd.

Head office

1-4-5 Roppongi, Minato-ku, Tokyo

Group homes

Representative

President and Chief Executive Officer:
Yoshiteru Hakamada

Total

Established

November 2006

Capital

100 million yen

Attributes(listed market)

Business
purpose/Principal
businesses

Unlisted[Purpose]
By providing support for the elderly’s independent life
and the families to back stronger family bonds under
the concept of “supporting families and living,” aims torealize improvement in quality of life (QOL) of all
customers through realization of nursing care services
that make users feel “glad to have met us” andprovision of a plus-one service.
[Principal businesses]
・Operation of fee-based homes for the elderly
・Operation of elderly housing with supportive services
・In-home nursing care support business・In-home care services business・Home-visit nursing care businessCompany name/Slogan▶About the company nameHITOWA＝HITO (people)＋WA (harmony/circle)＋TOWA (eternity)
As a company that provides comprehensive life support services, we wish to create a better
society connecting various businesses to make one “circle” while valuing “harmony” amongpeople. We also wish to continue supporting people and their daily life “eternally”. The
company name “HITOWA” carries such our thoughts.
▶Business slogan
All for care services that make users feel “glad to have met us.”
▶10 Rules for providing nursing care.
1. Will provide nursing care that I wish to have for myfamily members.
2. Will provide heartfelt services with smiles.
3. Will accept and welcome anyone.
4. Will aim to provide nursing care that will beappreciated until the very end.
5. Will eliminate all accidents.
6. Will respect user’s dignity and character.
7. Will aim to provide meal services/eating assistancethat bring joy to the users.
To provide nursing care services that
8. Will aim to provide pleasant toileting care.
make users feel “glad to have met us”
9. Will aim to provide safe and reliable bathing care.
Yoshiteru Hakamada
10. Will be a company beloved by the community.
President and Chief Executive Officer(Source) Website of HITOWA Care Service Co., Ltd., etc.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

11Change in Asset Size
Continuous external growth through acquisition of carefully selected properties(million yen)

Irise Komae Bettei(30% quasi coownershipof trust
beneficiary interest

18,60819,318 19,318 19,318 19,318 19,318 19,712

16,05813,280This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

12

Pipeline Development
Increase in the number of property acquisitions using bridges funds formed by Daiwa Securities Group (sponsor) and Daiwa ACA HealthCare as pipelines.

Sponsor’s bridge funds＜Pipeline with properties totaling 14 billion yen (part)＞

Nichii Home Kachidoki(Tentative) Kasama Project

Investment
Corporation
Irise Komae Bettei(70% quasi-co-ownership interest)

Alpha Living Takamatsu
Konyamachi

Daiwa ACA HealthCare Inc. (Pipeline support agreement to be concluded)＜Conclusion of a pipeline support agreement with Daiwa ACA HealthCare, of which a stake of 66% is heldby the sponsor, is under discussion＞(Scheduled to be concluded in January 2019)
 Seek to acquire properties from funds formed by Daiwa ACA HealthCare going forward

Daiwa ACA HealthCare Inc.
[Principal businesses] Investment in care facilities/hospitals in Japan

SponsorInvestment(66%)

 Investment in promising nursing care-related
real estate and hospital real estate Investment in operators which own healthcare
real estate(Business succession of medical corporations,care providers, etc.)

Existing facilities anddeveloped/value-added
properties

Futurepipelines

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

13

Portfolio Map（as of December 20, 2018）
Owned properties are diversified over 14 prefectures

Hokkaido Area
No. of Operators: 1(Note) Red numbers refer to Three Major Metropolitan Areas and blue numbers to Core City Areas. The
background colors for property names indicate types of facilities; orange for fee-based homes for theelderly with nursing care, blue for residential-type fee-based homes for the elderly and yellow-green
for elderly housing with supportive services.
(Note2 “Minna-no-ie· Omiya Yoshinocho" has renamed to “Minna-no-ie· Omiya Tsutsujigaoka Park" on 1
December 2018. Same as hereinter

Chubu Area
No. of Operators: 3

Chugoku Area
No. of Operators: 3

Irise Komae Bettei
Komae City, Tokyo

Tohoku Area
No. of Operators: 1
Kanto Area
No. of Operators: 5

Kinki Area
No. of Operators: 5
Shikoku Area
No. of Operators: 2
Kyushu Area
No. of Operators: 3

TargetRegionincorporation
incorporation
Ratios ofDefinition
Investment in Regions
ratio(*)
ratio

The greater Tokyo area: Tokyo, Kanagawa, Chiba
Three Major and Saitama prefectures
Metropolitan The Chukyo area: Aichi, Mie and Gifu prefectures
The Kinki area: Osaka, Kyoto, Hyogo, Nara andAreas
Shiga prefectures

50％
or more61.8％

Core City
Areas

Cities outside the Three Major Metropolitan Areas
with populations of 200,000 or more

50％
or less

38.2％

Cities outside the Three Major Metropolitan Areas

10％or less

0.0％（＊）組入比率は取得価格を基準とします。
Otherand the Core City Areas with populations under
200,000（＊） Incorporation ratio is based on the acquisition price.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

14

Introduction of Operators
Highly reliable operators
Operator

Nichii Gakkan

Number of Number ofmanaged operating
facilities
rooms(Note1,2)(Note1)429

13,970Established

August, 1973

Attributes

Listed on the first section of the Tokyo Stock
Exchange
Subsidiary of Sompo Holdings, Inc., a company
listed on the first section of the Tokyo Stock
Exchange
Subsidiary of Sohgo Security Service Co,. Ltd., acompany listed on the first section of the Tokyo
Stock Exchange

Sompo Care

428

26,131

May, 1997

Wisnet125

3,524

January, 1998

Hitowa care service

114

6,807

November, 2006 －Sawayaka Club

82

4,814

Subsidiary of Uchiyama Holdings Co., Ltd., a
December, 2004 company listed on the first section of the Tokyo
Stock Exchange

Super Court

48

3,236

August, 1984－

Charm Care Corporation

48

3,209

May, 1995

Listed on JASDAQ Standard on the Tokyo Stock
Exchange

Cedar

42

2,254

April, 1981

Listed on JASDAQ Standard on the Tokyo Stock
Exchange

Anabuki Medical Care

30

1,338

June, 2009

Subsidiary of Anabuki Kosan Inc., a company listedon the first section of the Tokyo Stock Exchange

Nihon Kaigo Iryo Center

21

905

October, 1997

Silver Heights Sapporo

3321

December, 1961 －(Note1)(Note2)

Diversification of Operators
Hitowa care service 2.0%

Nichii Gakkan 1.3%

Nihon Kaigo Iryo Center 4.8%
Silver Heights Sapporo
6.1%
Cedar 6.5%

Sompo Care
23.7%

Super Court 8.0%
Wisnet 8.0%

Sawayaka
Club 16.7%

AnabukiCharm Care
Medical Care 12.9%
Corporation 9.9%

Asset size in which lease agreement
is concluded with a single operator

40% or less－
(Note) The total acquisition price by operator as a percentage ofthe total acquisition price is indicated, rounded to one
decimal place.

Number of managed facilities and Number of operating rooms indicate the number of facilities and the number of rooms
for fee-based homes for the elderly, group homes and elderly housing with supportive services based on operators’
websites and interviews with them (as of October 31, 2018).
Operators are listed in order of the number of facilities they manage.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

15Section 3

Portfolio Analysis

Portfolio List (as of December 20, 2018)
Acquisition price (Note 2)No.
Acquisition period(Note 1)

Property nameFacility typeOperator

LocationPrice (million
yen)

Share ofportfolio (%)

Appraisal Number ofOccupancy rates (%)
value
rooms
(million yen) (rooms)
7th FP
8th FP(Note 3)(Note 4) （ Note6） （ Note6） Difference

11

1st Fiscal Period

Charm Sweet Ryokuchi Koen

Fee-based homes for the elderly with nursing care

Charm Care Corporation

Toyonaka City, Osaka

1,950

9.9

3,060

128

98.4

98.4

0.0

2
2

2nd Fiscal Period

Super Court JR Nara-Ekimae

Residential-type fee-based homes for the elderly

Super Court

Nara City, Nara

1,569

8.0

1,750

155

93.5

92.9

-0.6

3
3

1st Fiscal Period

Sompo Care LAVIERE Hiroshima Hikarigaoka

Fee-based homes for the elderly with nursing care

Hiroshima City, Hiroshima

960

4.9

1,230

80

97.5

93.7

-3.8

4
4

1st Fiscal Period

Sompo Care LAVIERE Sagamihara Chuo

Fee-based homes for the elderly with nursing care

Sagamihara City, Kanagawa

1,170

5.9

1,780

80

71.2

78.7

7.5

5
5

2nd Fiscal Period

Sompo Care LAVIERE Kinugasayama Koen

Fee-based homes for the elderly with nursing care

Yokosuka City, Kanagawa

1,839

9.3

2,060

104

90.3

89.4

-0.9

6
6

5th Fiscal Period

Sompo no ie NishitanabeekimaeFee-based homes for the elderly with nursing care

Osaka City, Osaka

710

3.6

739

42

97.6

97.6

0.0

7
7

1st Fiscal Period

Sawayaka Kaikyokan

Fee-based homes for the elderly with nursing care

Kitakyushu City, Fukuoka

630

3.2

898

65

98.4

95.3

-3.1

8
8

1st Fiscal Period

Sawayaka Meisuikan

Fee-based homes for the elderly with nursing care

Kitakyushu City, Fukuoka

590

3.0

813

87

100.0

100.0

0.0

9
9

1st Fiscal Period

Sawayaka Heart Life Nishikyogoku

Residential-type fee-based homes for the elderly

Kyoto City, Kyoto

750

3.8

1,140

84

98.8

94.0

-4.8

10
10

2nd Fiscal Period

Sawayaka Hinodekan

Fee-based homes for the elderly with nursing care

Niigata City, Niigata

773

3.9

920

50

100.0

96.0

-4.0

11
11

2nd Fiscal Period

Sawayaka Riverside Kurinoki

Residential-type fee-based homes for the elderly

Niigata City, Niigata

266

1.3

323

33

94.8

94.8

0.0

12
12

2nd Fiscal Period

Sawayaka Obatake Sanbankan

Residential-type fee-based homes for the elderly

Kitakyushu City, Fukuoka

289

1.5

355

50

100.0

94.0

-6.0

13
13

1st Fiscal Period

Nichii Care Center Fukushima Omori

Fee-based homes for the elderly with nursing care

Nichii Gakkan

Fukushima City, Fukushima

265

1.3

341

52

100.0

100.0

0.0

14
14

2nd Fiscal Period

La’nassica Arakogawa

Fee-based homes for the elderly with nursing care

Cedar

Nagoya City, Aichi

1,279

6.5

1,430

100

98.0

98.0

0.0

15
15

1st Fiscal Period

Verger Hirakata

Residential-type fee-based homes for the elderly

Nihon Kaigo

Hirakata City, Osaka

950

4.8

1,590

104

70.0

76.6

6.6

16
16

3rd Fiscal Period

Minna-no-ie Omiya Tsutsujigaoka Park

Fee-based homes for the elderly with nursing care

Saitama City, Saitama

740

3.8

776

33

93.9

84.8

-9.1

17
17

3rd Fiscal Period

Minna-no-ie Chuo-ku En’nami

Fee-based homes for the elderly with nursing care

15.6

18
18

3rd Fiscal Period

Silver Heights Hitsujigaoka No.3

Fee-based homes for the elderly with nursing care19
19

4th Fiscal Period

Alpha Living Okayama Nishigawa Ryokudokoen

Residential-type fee-based homes for the elderly

20
20

4th Fiscal Period

Alpha Living Okayama Korakuen

Residential-type fee-based homes for the elderly

21
21

4th Fiscal Period

Alpha Living Takamatsu Ekimae

Residential-type fee-based homes for the elderly

22
22

4th Fiscal Period

Alpha Living Takamatsu Hyakkenmachi

Elderly housing with supportive services

23
23

10th Fiscal Period

Irise Komae Bettei

Fee-based homes for the elderly with nursing care

11 operators(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)22 properties

Total

Sompo Care

Sawayaka Club

WisnetSilver Heights Sapporo

Anabuki Medical Care

Hitowa care service

Saitama City, Saitama

838

4.3

860

51

64.7

80.3

Sapporo City, Hokkaido

1,200

6.1

1,340

109

93.6

92.7

-0.9

Okayama City, Okayama

730

3.7

787

53

87.2

76.3

-10.9

Okayama City, Okayama

610

3.1

658

45

89.5

89.5

0.0

Takamatsu City, Kagawa

605

3.1

641

43

90.9

81.8

-9.1

Takamatsu City, Kagawa

605

3.1

626

50

85.1

83.3

-1.8

Komae City, Tokyo

394

2.0

399

59

-

98.3

-

19,712100.0

24,516

1,657

-

-

Red numbers refer to Three major metropolitan areas and blue numbers to Core cities. The background colors for Property name and Facility type columns indicate types offacilities; orange for fee-based homes for the elderly with nursing care, blue for residential-type fee-based homes for the elderly and yellow-green for elderly housing withsupportive services.
“Acquisition price” is excluding consumption tax, local consumption tax and the various expenses required for the acquisition. “Share of portfolio” is the respective acquisition
price expressed as a percentage of the total of the acquisition prices, rounded to one decimal place. Therefore the total of “Share of portfolio” may be different from the figure
indicated in “Total.”
Appraisal value" of "Irise Komae Bettei" is as of December 1, 2018, and the other facilities are as of October 31, 2018. "Irise Komae · Bettei" is equivalent to a quiasi-ownershipof 30%.
“Number of rooms” is the figure indicated in the written explanation of important matters pertaining to the fee-based home for the elderly provided by the operator. "Irise Komae/ Bettei" lists the number of rooms in the whole facility.
“Occupancy rate” is obtained by dividing the number of residents indicated in the written explanation of important matter received in May 2018 from operators by the resident
capacity, rounded down to one decimal place.
“Occupancy rate” is obtained by dividing the number of residents indicated in the written explanation of important matters received in November 2018 from operators by theresident capacity, rounded down to one decimal place.
As of April 1, 2018, "Sompo Care Message, Inc.." Changed its name to "Sompo Care ,Inc." and absorbed "SOMPO Care Next Corporation" as of July 1, 2018.

<Diversification of facilities>

Residential-type
29.3%
Fee-based homes
for the elderly 96.9%

Elderly housing withsupportive services
3.1%

With nursing care
67.7%

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

17

Status of Portfolio：Change in Occupancy Rates
Change in occupancy rates (overall)
90.6％(persons)

Stable occupancy rates
 The overall occupancy rate down by 0.6% from 91.2% at the end of April 2018 to 90.6% at the end of October 2018.
 The period average down by 0.6% from 90.8% for the 8th Fiscal Period to 90.2% for the 9th Fiscal Period.
 Although the occupancy rate both during the year and at the end of the year declined as compared with the previous Fiscal
Period, it remained stable at 90%.
(Note) Occupancy rates are obtained by dividing the number of residents based on interviews with all facilities, by resident capacity.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

18

Remaining Lease Contract Period of Each Property
Contract expiry date

Remaining lease
contract period

Irise Komae Bettei

January 31, 2047

28.3Years

Minna-no-ie Chuo-ku En’nami

March 31, 2044

25.4Years

Minna-no-ie Omiya Tsutsujigaoka Park

February 28, 2037

18.3Years

Operator
Hitowa care service
WisnetProperty nameSuper Court

Super Court JR Nara-Ekimae

July 14, 2039

20.7Years

Charm Care Corporation

Charm Sweet Ryokuchi Koen

August 28, 2038

19.8Years

Silver Heights Sapporo

Silver Heights Hitsujigaoka No.3

November 30, 2035

17.1Years

June 30, 2035

16.7Years

September 11, 2034

15.9Years

March 28, 2034

15.4Years

March 31, 2027

8.4YearsNovember 30, 2034

16.1Years

March 27, 2034

15.4Years

Nichii Care Center Fukushima Omori

March 31, 2034

15.4Years

Verger Hirakata

March 28, 2034

15.4Years

La’nassica Arakogawa

March 31, 2028

9.4Years

Alpha Living Okayama Nishigawa Ryokudokoen
Anabuki Medical Care

Alpha Living Okayama Korakuen
Alpha Living Takamatsu Ekimae
Alpha Living Takamatsu Hyakkenmachi
Rest Villa Kinugasayama Koen

Sompo Care

Rest Villa Hiroshima Hikarigaoka
Rest Villa Sagamihara Chuo
Sompo no ie Nishitanabeekimae
Sawayaka Hinodekan
Sawayaka Riverside Kurinoki

Sawayaka Club

Sawayaka Obatake Sanbankan
Sawayaka Kaikyokan
Sawayaka Meisuikan
Sawayaka Heart Life Nishikyogoku

Nichii Gakkan
Nihon Kaigo Iryo Center
Cedar

Average remaining period

16.8Years(Note1) In case that the property leased to multiple tenants, the information is based on lease agreements with the main tenant of operators.
(Note2) All leasing contracts are ordinary lease contracts.
(Note3) “Remaining Lease Contract Period” indicates period remaining as of October 31, 2018. “Average remaining period” is a weighted average with acquisition prices,rounded to one decimal place.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

19

Status of Portfolio: Fee Systems of Facilities
Name of facility
Charm Sweet Ryokuchi Koen

One-time entrance fee(thousand yen)Monthly rent (yen)2,400 ～4,800

165,879～211,879
245,879～251,879

Super Court JR Nara-Ekimae
Sompo Care LAVIERE Hiroshima Hikarigaoka

150,080
4,500 ～6,800

261,690～300,020

Sompo Care LAVIERE Sagamihara Chuo
Sompo Care LAVIERE Kinugasayama Koen

186,690234,800～254,800

3,800 ～7,800

199,071
262,401～329,071

Date of acquiring the written
explanation of important matters
July 1, 2018
May 1, 2018
November 1, 2018
July 1, 2018
August 1, 2018

Sawayaka Kaikyokan

142,600～145,600

October 1, 2018

Sawayaka Meisuikan

103,440～138,440

October 1, 2018

Sawayaka Heart Life Nishikyogoku

161,600～181,600

October 1, 2018

196,820

October 1, 2018

Sawayaka Hinodekan
Sawayaka Riverside Kurinoki

157,742

October 1, 2018

Sawayaka Obatake Sanbankan

122,300

October 1, 2018

Nichii Care Center Fukushima Omori

162,743

October 1, 2018

La’nassica Arakogawa

1,260 ～2,100

152,340～154,340
189,340

October 1, 2018

Verger Hirakata

135,000

September 26, 2018

Minna-no-ie Omiya Tsutsujigaoka Park

166,837

October 1, 2018

Minna-no-ie Chuo-ku En’nami
Silver Heights Hitsujigaoka No.3
Alpha Living Okayama Nishigawa Ryokudokoen
Alpha Living Okayama Korakuen
Alpha Living Takamatsu Ekimae
Alpha Living Takamatsu Hyakkenmachi
Sompo no ie Nishitanabeekimae
Irise Komae Bettei

162,400

October 1, 2018

2,000 ～4,000

165,780～173,340

October 1, 2018

1,380

137,000～159,000

October 1, 2018

1,620 ～2,850
1,200
1,200

148,000～189,000
157,000～180,000
160,000～205,000
195,500

October 1, 2018
October 1, 2018
October 1, 2018
October 1, 2018

227,000～248,000

July 1, 2018

(Note1)“One-time entrance fee” indicates one-time entrance fee stated in the written explanation of important matters or in the price list acquired from the operators. “Monthly fee” indicates themonthly fee for a standard single room stated in the written explanation of important matters or in the price list acquired from the operators (excluding the co-payment amount of nursing
care insurance services). One-time entrance fee and monthly rent for facilities with one-time entrance fee are indicated on a one-time entrance fee basis (one-time entrance fee and monthly
fee are indicated separately) whereas those for facilities without one-time entrance fee are indicated on a monthly payment basis.

(Note2)

Charm Sweet Ryokuchi Koen (One-time entrance fee plan / Former monthly fee 162,120 - 208,120 yen, Non One-time entrance fee plan / Former monthly fee 242,120 - 248,120 yen)revised fees in February 2018, Sompo no ie Nishitanabeekimae (Former monthly fee 182,500 yen) revised fees in April 2018.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

20

Status of Portfolio (as of December 20, 2018)
Rent-Paying Capacity

1.2x or less
26.6%

Proportion of Entrance Fee
Amortization Income

More than 60%,
but 70% or less
5.4%

More than
2.0x
24.1%

Rent-Paying
Capacity (Note 1)
Average 1.6x
(On appraisal basis:
Average 1.7x)More than 1.2x,
but 1.5x or less
16.7%

Proportion of Nursing Care Fee

More than 50%,
but 60% or less
48.1%

Proportion of
Nursing
Care Fee(Note 2)
Average 50.1%

50% or less
46.5%

More than
5%, but
15% or less
37.6%

Proportion of
Entrance Fee
Amortization
Income(Note 3)
Average 3.5%

5% or less
62.4%

More than 1.5x,
but 2.0x or less
32.6%

(Note 1) “Rent-paying capacity” refers to themultiple obtained by dividing therespective acquired asset’s mostrecent EBITDAR by rent.
* EBITDAR＝asset’s operating
income+ depreciation + rent

(Note 2) “Proportion of nursing care fee”
refers to the proportion of theacquired asset’s net sales that isaccounted for by nursing care fee(including residents’ co-payment
portion).

(Note 3) “Proportion of entrance fee
amortization income” refers to the
proportion of the acquired asset’s net
sales that is accounted for byentrance fee amortization income.

(*) Data are based on information on business income and expenditures from October 2017 to September 2018 disclosed by the respective operator. However, the data of following
facilities is based on financial results of the respective periods; Nichiikea Center Fukushima Omori is from July 2017 to June 2018, La Nasica Aarakogawa is from April 2017 toMarch 2018, and the Silver Heights Hikage 3rd Building is from September 2017 to August 2018. "Irise Komae · Bettei" shows the figures of the entire facility

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

21

Portfolio Resident Attributes (as of December 20, 2018)
Gender(Note1)

Age Group(Note2)

Level of Requiring Nursing Care or Support(Note 3)
Independent Other
Requiring
0.8%
0.3% Requiring nursing
support level1
care level 5
5.7%
8.8%
Requiring support
level 2

Under 65
65 years years
or over, 1.6%
but under
75 years

Male
29.6%

Female70.4%

8.3%

75 yearsor over,but under
85 years

24.7%

Requiring
nursingcare level 4

4.9%

85 yearsor over

Average
Requiring nursing
requiredcare level 1
level of24.1%
nursing care
2.3

65.4%

Requiring nursing
care level 2

16.0%

Requiring
nursingcare level 3

17.3%

22.0%
(Note 1) The graph indicates the ratio of thenumber of residents per gender
expressed as a percentage of the total
number of residents.

(Note 2) The graph indicates the ratio of thenumber of residents per age groupexpressed as a percentage of the total
number of residents (except for residents
at Sompo Care LAVIERE Sagamihara
Chuo and Sompo Care LAVIERE
Kinugasayama Koen as there is no suchinformation stated in the written
explanation of important matters).

(Note3) The graph indicates the ratio of the number ofresidents per level of requiring nursing care or
support expressed as a percentage of the total
number of residents.
“Average level of nursing care” indicates thefigure obtained by multiplying the respective
number of residents categorized as
independent, requiring support level 1,
requiring support level 2, requiring nursing
care levels 1-5 and other by 0, 0.375, 1, 1-5
and 1 respectively, and dividing the sum total
by the number of residents.

(*) Data are based on figures stated in the written explanation of important matters (November 2018) provided by each operator. All percentage figures are rounded to one
decimal place. “Average required level of nursing care” is rounded down to the first decimal place. "Irise Komae · Bettei" shows the figures of the entire facility.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

22Section 4

Initiatives for ESG

Initiatives for ESG (Environment)
The Asset Management Company positions initiatives for ESG (Environment, Social, Governance) as important management issues.

Establishment of the Sustainability Committee

Daiwa Real Estate Asset Management Co. Ltd., the asset management company of NHI, established the Sustainability Committee with the Representative Director as the committee chairperson inJune 2014 to promote initiatives for ESG in a continuous and organizational manner.

Committee meetings are held three times or more a year on average to share ESG-related information among officers and employees, including the management team, for further improvements.

Formulation of environmental policy

NHI and the Asset Management Company recognize the importance of environmental issues in the real estate sector,
and strive to make continuous efforts on environmental consideration, reduction of environmental burden and such in all
corporate activities including the real estate investment management business, as a social responsibility of companies.

Environmental policy (established in January 2012)

Energy-saving initiatives█ Installation of solar panels
 Installed solar panels on the rooftop of Minna-no-ie
Chuo-ku En’nami

1. Implementation of Resource and Energy Saving
Daiwa Office Investment Corporation will proactively promote efficient use of resources andenergy, andcontribute to realizing a low-carbon society through such measures as employing technologies and systems
designed to save resources and energy.

2. Implementation of Environmental Conservation
Daiwa Office Investment Corporation will work to contribute to realizing a recycling oriented society throughefforts for saving water, reducing waste generation, re-using and recycling as it continuously conducts corporate
activities.
Daiwa Office Investment Corporation will also work to promote green procurement, greening office buildings andimproving the office environment, among other efforts, to address biological diversity and achieve environmental
symbiosis.

3. Promotion of Environmental Disclosure/Communication
Daiwa Office Investment Corporation will work to proactively disclose environment-related information, as wellas aim to broadly communicate with society, and to coordinate and cooperate with tenants, communities,business partners and other stakeholders.

[Rooftop view of Minna-no-ie Chuo-ku En’nami]█ Installation of LED lighting
 Installed LED lighting at Verger Hirakata and Charm Sweet
Ryokuchi Koen

4. Establishment and Operation of Environmental Management System
Daiwa Office Investment Corporation will establish an environmental management system and work tocontinuously enhance its environmental activities. Daiwa Office Investment Corporation will also work to further
improve the awareness of officers and employees in environmental preservation by conducting environmental
education and enlightenment activities.

5. Adherence to Environment-Related Laws and Regulations
Daiwa Office Investment Corporation will adhere to its internal environmental policies and guidelines as well as
to environment-related laws and regulations, in an effort to preserve the environment.

[Installation of LED lighting at
Verger Hirakata][Installation of LED lighting in a room at
Charm Sweet Ryokuchi Koen]

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

24

Initiatives for ESG (Social) (1)Social contribution to solving important issues in Japan

Provision of excellent properties operated by skillful operators that are carefully selected by NHI, where the elderly can live with peace of mind.

Careful selection of operators and monitoring after making investments
Operator evaluation items at thetime of property acquisition
 Quality and variety of services that each operator provides
 Credibility and operational skills of the operator

Continuous facility management/monitoring system The Asset Management Company strives to enhance value of facilities by regularly collecting
information on the operation from the operators and the facility directors in cooperation with PMcompanies, etc.
 The Asset Management Company visits facilities, etc. and conduct facility monitoring, interviews, etc.
including the following

 Monitoring (Twice or more/year)
・The Asset Management Company and PM
companies visit operators’ facilities andconduct examinations every fiscal period.
 Interviewing (Once or more/year)
・Confirming the following items withdirectors and care providers at facilities:(1) Responses to residents(2) Employees training program(3) Status of governance (including items
to check for prevention of resident
mistreatment)＜Facility monitoring＞
・Sompo Care LAVIERE
Kinugasayama Koen (Sep. 2018)

・Verger Hirakata(Sep. 2018)

・Sompo Care LAVIERE Sagamihara
Chuo (Oct. 2018)

・Alpha Living Takamatsu
Hyakkenmachi (Oct. 2018)

Provision of excellent healthcare facilities operated by skillful operators
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

25

Initiatives for ESG (Social) (2)Exchange with local communities█ Minna-no-ie Omiya Tsutsujigaoka Park
■Summer evening festival: Held stalls, Bon dance, etc. at thesummer evening festival
Interacted with residents, their families, facility staff and local
volunteers.

█ Sompo Care LAVIERE Kinugasayama Koen
■Respect-for-the-Aged Day: Held a party to celebrate the day
Interacted with residents, facility staff and local volunteers.

█ Super Court JR Nara-Ekimae■Koto performance: Had local high school students play the kotoCreation of employment in local communities█ Employment by each facility■Caregivers and cleaning staff of each facility operated by the operators are comprised of people living within a radius of about
3km from the facility. Therefore, the facilities have contributed to creation of employment in local communities.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

26

Initiatives for ESG (Governance) (1)Corporate governance

The Asset Management Company of NHI has established a governancesystem that gives top priority to compliance, and strives to prevent conflictsof interest, manage risks and comply with laws and regulations.

Decision-making flow for transactions with interested parties

Compliance system


The Asset Management Company not only adheres strictly to all laws andregulations, rules, internal regulations and market rules related to its
business but also focuses on conducting sincere and fair corporate activities
while fully understanding social norms.

Departments responsible for the compliance system

The Asset Management Company selects assets to invest in and decides on the acquisition
following the investment policy and the rules for preventing conflicts of interest set forth in
the management guidelines.
The Asset Management Company has established the Investment Committee and theCompliance Committee as a system to prevent conflict of interest transactions andconducted proper management.
Decision-making process from preparation/submission of proposals on investment
management to their approvals is shown below.

Persons having a special interest may not exercise voting rights on matters resolved at theInvestment Committee, Compliance Committee or Board of Directors.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

27

Initiatives for ESG (Governance) (2)
Number and ratio of qualification holders at the Asset Management Company


In order to develop employees who will have both sincerity and strong expertise, theAsset Management Company of NHI provides regular compliance trainings for all
employees, promotes acquisition of qualifications to improve their specialist skills andsupports them in receiving training/taking examinations, etc. to acquire broader
knowledge and skills required in the business.
Qualification

Number ofholders(persons)

Ratio
(%)

Examples of trainings provided by the
Asset Management Company

Real estate broker

64

56.1

ARES (The Association for Real Estate
Securitization) Certified Master

32

28.1

Compliance training(including transferee training)

13 times/year

Certified real estate consulting specialist

7

6.1

Training for persons responsible for
information security

4 times/year

Registered architect of the first class

6

5.3

Daiwa Real Estate School(organized by an appraisal company)

24 times/year

Real estate appraiser

2

1.8

Real estate business knowledge training

About 2 times/year

Certified building administrator

4

3.5

About 12 times/year

Chartered member of The Securities Analysts
Association of Japan

7

6.1

Other trainings to improve businessrelated skills(including classroom training and elearning)

Tax accountant

2

1.8

Training

Number of times*As of December 1, 2018, 114 officers and employees

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

28Section 4

Financial Status

Status of Interest-Bearing Liabilities (as of October 31, 2018)
Status of Interest-Bearing Liabilities (as of October 31, 2018)
Term

Balance
Interest(million yen)
1,200

LenderResona Bank (**)
Current
Portion of Mizuho Bank (**)
Long-term Mizuho Trust & Banking (**)
Mizuho Bank

1,000

(**)

Mizuho Trust & Banking (**)
The Musashino Bank(**)

Resona Bank (**)
Sumitomo Mitsui Trust Bank(**)

Mizuho Bank (**)

Fixed

Interest

Drawdown

0.532%

November 5, 2014

October 31, 2019

June 1, 2015

May 29, 2020
October 30, 2020

0.532%

500

0.524%

500

0.524%

500

0.524%

500

0.474%

October 15, 2015

500

0.138%

April 28, 2016

800

0.402%

500

(**)

Fixed

0.265%

October 31, 2017

October 30, 2020

0.365%

500

0.467% September 28, 2018 September 29, 2023

Sumitomo Mitsui Trust Bank (**)

1,200

0.390%

Shinkin Central Bank400

0.390%

Shinsei Bank(**)
The Dai-ichi Life Insurance

300

0.467%

200

0.480%

(**)

Total

9,800

Ratio of Long-Term Loans Payable andShort-Term Loans Payable-

Averageremaining
period (Note)

April 30, 2020

500

Shinsei Bank

46.5％

October 31, 2022(**)

The Musashino BankLTV(Note)

0.532%

700

Long-term Shinkin Central Bank(**)

Repayment
deadline

April 28, 2022

2.5 years

October 31, 2022
October 31, 2018-

September 29, 2023
October 31, 2023-

Ratio of Fixed Rates andFloating Rates-(Note) LTV and average remaining period indicate figures
calculated as of October 31, 2018, rounded to the firstdecimal place. LTV is calculated based on total assets.

Repayment Schedule(million yen)current portion of
long-term loans payable

29.6%

Ratio offixed rateLong-termloans payable

100.0%

70.4%(*) Interest rates are rounded to the third decimal place.
(**) For loans of which floating interest rates have been converted to, in effect, fixed rates through a swap
agreement, interest rate indicates the rate after such conversion.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

30

Overview of the Unitholder Benefits Program

With the cooperation ofoperators who are the tenants,
the unitholder benefits
program will be offered
to unitholders as of the end of
fiscal period ended April 2018.

<COCO Juku>
 Free enrollment<New York University-Professional Departmentof American Language Institute Tokyo school>
 Free enrollment and discount from tuition<Nichii Life>
 Discount voucher for house keeping,childcare and long-term care service

 Discount coupon for the initial
lump sum payment (5%discount) Free voucher for an overnight
trial stay (with meals) Free voucher for a facility tour
(with lunch provided) Discount coupon for the initial
lump sum payment (200,000 yen
discount from the initial lump sum
payment, or in the case of the planof 0 yen initial lump sum payment,
discount the amount equivalent to
the monthly rent) Free voucher for an overnight trial
stay (with meals) Free voucher for an overnight
trial stay (with meals) Free voucher for a one-day
facility tour (with lunch
provided) Furniture presented to the newresident for the below “Facilities
Available”(chosen from the catalog Anabuki
Medical Care provides)(worth 50,000 yen excluding tax, in
excess of 50,000 yen the difference shallbe paid by the resident, can also choose
two or more pieces of furniture if it iswithin 50,000 yen)<For the contract of lump sum payment plan> Discount from the initial lump sum payment(200,000 yen or 3% discount from the initial
lump sum payment, whichever is thegreater)<For the contract of monthly payment plan> From the monthly payment, persistent
discount of 3% of the amount equivalent to
the monthly rent (until the end of thecontract term) Free one-day facility tour (with lunch
provided) Free voucher for an overnight
trial stay (with meals) Free voucher for an overnight trial stay(with meals) one-time-only Free voucher for a facility tour (withlunch provided) one-time-only 50,000 yen cash back for the monthly
payment for the new resident(one-time-only, need to stay more than
three months after moving into the facility) 10% discount coupon for the
first monthly payment
 Free voucher for an overnight
trial stay (with meals) Free voucher for a one-day
facility tour (with lunch
provided) Discount on occupancy
expenses (discount of 2
month’s rent of the facility
upon moving in) Free voucher for a one-day facility tour
(with lunch provided)
 Free Monthly Usage fee (Equivalent to
two months rents)

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

31

Appendix

Memorandum

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

33

Surrounding Status of Healthcare Facilities : Progress of aging society
Domestic demographics by age
Population(10 thousand)Actual figures

75 yearsor older65-74
years old

15-64
years old

0-14
years old

Population aging rate (rate of population 65 years or older)

Changes and ratio of elderly population living alone
Population(10 thousand)Actual figures

Male

Female(％)

Estimatedfigures(%)

Male

Estimatedfigures

Female(%)(Source) Cabinet Office “White Paper on Aging Society 2017”

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

34

History of Revisions to Nursing Care Fees
Time of revision
FY 2005 revision(Enforced in October
2005)

Main points of revision
 Securement of fairness between at-home care and facility services, etc.

Review of nursing care fees related to living costs and meal costs

 Promotion of encouraging self-support and at-home nursing care

FY 2006 revision

FY 2009 revision

FY 2014 revision-0.5%【-2.4%】

Promotion of nursing care prevention and rehabilitation
・Changing prevention benefits provision from piecework payment to comprehension payment bymonthReinforcement of support for those requiring medium- to high- levels of nursing care・Additional payment for home-visit long-term care and home-visit nursing care provided to thoserequiring high level of cares, etc.

【】: Rate of revision including
revision in FY2005

 Improvement in working conditions of care providers+3.0%

Securement of care providers / improvement of working conditions of care providers
・Additional payment in accordance with care providers’ expertise, career, etc.
 Securement of improved working conditions for care staff and promotion of

FY 2012 revision

Rate of revisioncommunity comprehensive careFoundation of additional payment for improving working conditions
Establishment of new services such as around-the-clock periodical door-to-door service
 Response to increased burden due to the consumption tax hike[At-home：-0.1%] 【-1.0%】[Facility：±0.0%] 【-4.0%】[At-home：＋1.7%][Facility：＋1.3%]+1.2%[At-home：＋1.0%][Facility：＋0.2%]＋0.63％

 Initiatives for building a “community comprehensive care system”

FY 2015 revision

FY 2017 revision

FY 2018 revisionFurther reinforcement of care for those requiring medium- to high- levels of nursing care and those withdementia
Promotion of securing care staff
Enhancement of appropriateness of service assessment and establishment of efficient system forproviding services-2.27%

 Improvement in working conditions of care providers
Established a new system to raise salary in accordance with care provider experience or qualifications
and raised monthly salary by 10,000 yen-worth on average.

＋1.14％

 Promotion of establishing a system to provide high-quality and efficient long-term care service
Promotion of community comprehensive care system
Realization of high-quality long-term care service contributing to self-reliance and prevention ofdeterioration in condition
Securement of diversified personnel and improvement of productivity
Securement of stability and sustainability of the system through enhancement of appropriateness andfocus in long-term care service[At-home：-1.42%][Facility：-0.85%][At-home：＋0.72％][Facility：＋0.42％]+0.54％

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

35

Market Size of Healthcare Facilities and Fee-based Homes
for the Elderly (by price)
Market size of fee-based homes for the elderly and elderly housing with supportive services is 8 trillion yen, therefore there is much room for NHI to expand

Market size by price (Fee-based homes for the elderly requiring
nursing care/who are independent) (as of June 2016)

Market size of healthcare facilities（as of Oct. 2017）
3 types of facilities
covered by nursing careinsurance services

Elderly housingwith supportive services
2,329.8 bil. yen（10.0％）

High

12,232.7 bil. yen（52.5％）

Zone of
Owned properties

Fee-based homes
for the elderly

5,987.0 bil. yen（25.7％）

Group Homes
2,740.9 bil. yen（11.8％）

14.5 billion yen（1,236 rooms）

500 thousand
yen/month

Price (assumed monthly fees)

Total
23,290.3
billion yen

85.1 billion yen（9,589 rooms）

Low

600 thousand
yen/month31.1 billion yen（5,584 rooms）

130.8 billion yen（21,252 rooms）
350 thousand
yen/month

400 thousand
yen/month337.2 billion yen（73,528 rooms）
200 thousand
yen/month84.1 billion yen（22,354 rooms）
200 thousand
yen/month

930.6 billion yen（292,592 rooms）

Requiring nursing care
Source：KPMG Healthcare Japan Co., Ltd

12.2 billion yen（6,217 rooms）

Independent

Residents’ physical condition

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

36

Status of Portfolio (as of October 31, 2018)
Rent-Paying Capacity

Proportion of Nursing Care Fee
More than 60%,
but 70% or less
5.6%

More than
2.0x
1.2x or less
25.3%
27.9%
Rent-Paying
Capacity (Note 1)
Average 1.6x
(On appraisal basis:
Average 1.7x)More than 1.2x,More than 1.5x,
but 1.5x or lessbut 2.0x or less
12.6%
34.2%

(Note 1) “Rent-paying capacity” refers to themultiple obtained by dividing therespective acquired asset’s mostrecent EBITDAR by rent.
* EBITDAR＝asset’s operating
income+ depreciation + rent

Proportion of
Nursing
Care Fee(Note 2)
Average 50.3%

Proportion of Entrance Fee
Amortization Income

More than
5%, but
15% or less
39.4%
50% or less
43.9%

Proportion of
Entrance Fee
Amortization
Income(Note 3)
Average 3.6%

5% or less
60.6%

More than 50%,
but 60% or less
50.4%

(Note 2) “Proportion of nursing care fee”
refers to the proportion of theacquired asset’s net sales that isaccounted for by nursing care fee(including residents’ co-payment
portion).

(Note 3) “Proportion of entrance fee
amortization income” refers to the
proportion of the acquired asset’s net
sales that is accounted for byentrance fee amortization income.

(*) Data are based on information on business income and expenditures from October 2017 to September 2018 disclosed by the respective operator. However, the data of thefollowing facilities is based on the financial results of each facilities; Nichii Care Center Fukushima Omori is from July 2017 to June 2018, La Nasica Aaragawa is from April 2017
to March 2018, and the Silver Heights Hikage 3rd Building is from September 2017 to August 2018.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

37

Portfolio Resident Attributes (as of October 31, 2018)
Gender(Note1)

Male
29.3%

Level of Requiring Nursing Care or Support(Note 3)

Under 65
65 years years
or over, 1.7%
but under
75 years

Independent Other
Requiring
0.9%
0.3% Requiring nursing
support level 1

care level 5

5.8%

Requiring support
level 2

8.4%

8.8%

5.0%

75 yearsor over,but under
85 years

24.2%
Female70.7%

Age Group(Note2)

85 yearsor over

Average
Requiring nursing
requiredcare level 1
level of
24.4%
nursing care
2.3

65.7%

Requiring nursing
care level 2

Requiring
nursingcare level 4

15.8%

Requiring
nursingcare level 3

17.1%

22.0%
(Note 1) The graph indicates the ratio of thenumber of residents per gender
expressed as a percentage of the total
number of residents.

(Note 2) The graph indicates the ratio of thenumber of residents per age groupexpressed as a percentage of the total
number of residents (except for residents
at Sompo Care LAVIERE Sagamihara
Chuo and Sompo Care LAVIERE
Kinugasayama Koen as there is no suchinformation stated in the written
explanation of important matters).

(Note3) The graph indicates the ratio of the number ofresidents per level of requiring nursing care or
support expressed as a percentage of the total
number of residents.
“Average level of nursing care” indicates thefigure obtained by multiplying the respective
number of residents categorized as
independent, requiring support level 1,
requiring support level 2, requiring nursing
care levels 1-5 and other by 0, 0.375, 1, 1-5
and 1 respectively, and dividing the sum total
by the number of residents.

(*) Data are based on figures stated in the written explanation of important matters (November 2018) provided by each operator. All percentage figures are rounded to one
decimal place. “Average required level of nursing care” is rounded down to the first decimal place.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

38

Introduction of Operators (1)Company name

Nichii Gakkan Company

Company name

Sawayaka Club Co., Ltd.

Head office

2-9 Kanda-Surugadai, Chiyoda-ku, Tokyo

Head office

2-10-10 Kumamoto, Kokura-kita-ku, Kitakyushu-shi, Fukuoka

Representative director Representative director, Fumiharu Uchiyama

Representative director Chairman, President and CEO, Nobusuke Mori
Established

August 2, 1973

Capital11,933 million yen

Attributes(listed market)

Listed company(First Section of the Tokyo Stock Exchange, Securities code: 9792)

Principal businesses

Medical Support Business, Nursing Care and Health Care Business, Education
Business and Child-care Business

Established

December 1, 2004

Capital

200 million yen

Attributes(listed market)

Consolidated subsidiary of Uchiyama Holdings Co., Ltd.
(First Section of the Tokyo Stock Exchange, Securities code: 6059)

Principal businesses

Operation of fee-based homes for the elderly, elderly housing with supportive
services, group homes, short-stay facilities, helper stations, care plan centers,
nursing care day service centers and multifunctional nursing care in a small
group home setting

Parent company

Uchiyama Holdings Co., Ltd.

Nichii Care Center Fukushima Omori
Sawayaka Hinodekan
Company name

Sompo Care Next Inc.

Head office

4-12-8 Higashi Shinagawa, Shinagawa-ku, Tokyo

EstablishedMay 1, 1997

Capital3,925 million yen

Attributes(listed market)

Consolidated subsidiary of Sompo Holdings, Inc. (First Section of the Tokyo
Stock Exchange, Securities code: 8630)

Principal businesses

Operation of fee-based homes for the elderly, elderly housing with supportive
services and group homes; Home-visit care (home assistance) service business

Parent company

Sompo Holdings, Inc.

Company name

Cedar Co., Ltd.

Head office

1-7-19 Obatake, Kokura-kita-ku, Kitakyushu-shi, Fukuoka

Representative director Representative director, Takayasu Zakoda
Established

April 25, 1981

Capital

432 million yen

Attributes(listed market)

Listed company(JASDAQ of the Tokyo Stock Exchange, Securities code: 2435)
Operation of fee-based homes for the elderly, elderly housing with supportive
services, group homes, short-stay facilities, helper stations, care plan centers,
nursing care day service centers and multifunctional nursing care in a small
group home setting

Principal businesses

Sompo Care LAVIERE
Hiroshima Hikarigaoka

Sompo Care LAVIERE
Sagamihara Chuo

(Note) The capital of Sompo Care Inc. is as of June 19, 2018.

Sawayaka Kaikyokan

シダー

Representative director Representative director, Ken Endo

Sompo Care LAVIERE
Kinugasayama Koen

Sawayaka Obatake Sanbankan Sawayaka Meisuikan

Sompo no ie
Nishitanabeekimae
La’nassica Arakogawa

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

39

Introduction of Operators (2)Company nameCharm Care Corporation

Company nameNihon Kaigo Iryo Center Co., Ltd.

Head office

3-6-32 Nakanoshima, Kita-ku, Osaka-shi, Osaka

Head office2-4-1 Hannancho, Abeno-ku, Osaka-shi, Osaka

Representative director Representative director, Takahiko Shimomura
Established

August 22, 1984

Capital

192 million yen

Attributes(listed market)

Listed company(JASDAQ of the Tokyo Stock Exchange, Securities code: 6062)
Operation of fee-based nursing homes for the elderly with care and fee-based
assisted-living homes for the elderly

Principal businesses

Representative director Representative director, Yusuke Taniguchi
Established

October 7, 1997

Capital50 million yen

Attributes(listed market)

Unlisted company

Principal businesses

In-home nursing care support business, home-visit nursing care business,
operation of rental housing for the elderly, selling and rental of equipment
covered by public aid, care worker training business, real estate business

Charm Sweet Ryokuchi Koen

Verger Hirakata

Company nameSuper Court Co., Ltd.

Head office

1-7-7 Nishihonmachi, Nishi-ku, Osaka-shi, Osaka

Representative director Representative director, Akiyoshi Yamamoto

Company name

Wisnet Co., Ltd.

EstablishedMay 19, 1995

Head office2-795 Mihashi, Omiya-ku, Saitama-shi, Saitama

Capital50 million yen

Attributes(listed market)

Unlisted company

Representative director Representative director, Yuuichi Miyazawa
Established

January 1998

Capital390 million yen

Principal businesses

Operation/management of fee-based homes for the elderly and housing for theelderly, operation/management of buildings and condominiums,
planning/design/construction of rental apartments, a nursing care worker
nurturing and training business, etc.

Attributes(listed market)

Consolidated subsidiary of Sohgo Security Service CO,. LTD., (First Section of
the Tokyo Stock Exchange, Securities code: 2331)

Parent company

Super Holdings Co., Ltd.

Principal business

Operation and management of group home for dementia, fee-based homes forthe elderly with nursing care, elderly housing with supportive services, helper
station, day service center, small scale multi-function home care, home care
support office, visiting nursing staion

Super Court JR Nara-Ekimae

Minna-no-ie Omiya Yoshinocho

Minna-no-ie Chuo-ku En’namiThis document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

40

Introduction of Operators (3)Company nameHead office

Silver Heights Sapporo Co., Ltd.

Company nameAnabuki Medical Care Inc.

3-41, Fukuzumisanjou, Toyohira-ku, Sapporo-shi, Hokkaido

Head office2-8, Togiyamachi, Takamatsu, Kagawa

Representative director Representative director, Hirofumi Kaneko

Representative director Representative director, Yoshihisa Otani

Established

December 1961

Established

June 2009

Capital50 million yen

Capital

80 million yen

Attributes(listed market)

Unlisted company

Attributes(listed market)

Principal businesses

Operation of fee-based homes for the elderly, homecare service specified in theLong-Term Care Insurance Act, homecare support specified in the Long-Term Care
Insurance Act, purchase/sales, arrangement, lease and management of real estate,
etc.

Consolidated subsidiary of Anabuki Kosan Inc.
(First Section of the Tokyo Stock Exchange, Securities code: 8928)
Nursing care-related business (nursing care business, operation of fee-based
homes for the elderly, etc.), real estate management, advertising, etc.

Principal businesses

Silver Heights Hitsujigaoka No.3
Alpha Living Okayama
Nishigawa
Ryokudokoen

Company nameHITOWA Care Services Co., Ltd.

Head office

1-4-5 Roppongi, Minato-ku, Tokyo

Alpha Living Okayama Korakuen

Alpha Living Takamatsu
EkimaeAlpha Living
Takamatsu
Hyakkenmachi

Representative director Representative director, Yoshiteru Hakamada
Established

November 1, 2006

Capital

100 million yen

Attributes(listed market)

Unlisted

Principal businesses

Operations of fee-based homes for the elderly and elderly housing with supportive
services under the brand of “Irise”; and operations of group homes business andday services business across Japan centering on the Kanto region.

Parent company

HITOWA Holdings Inc.

Irise Komae Bettei

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

41

Ranking of Operators Based on the Number of Rooms
RankingCompany name(Note 1)
1 Sompo Care Inc.

Fee-based homes for the elderly withnursing care
Number of
Number of rooms
facilities
275
17,271

Residential-type fee-based homes
for the elderly
Number of
Number of rooms
facilities
3
91

Other housing for the elderly
Number of
facilities
132

Total (Note 2)

Number of
rooms
7,649

Number of
facilities
431

Number ofrooms
25,4872 Company A

251

13,338

60

3,564

2

109

316

17,061

3 Nichiigakkan Co., Ltd.

140

8,529

2

100

6

238

427

13,8674 Company B

128

8,089

43

2,705

1

51

172

10,8455 Company C

79

6,461

33

3,047

0

0

113

9,520

6 Company D

18

1180

11

269

16

430

181

7,955

7 HITOWA Care Service Co., Ltd.

47

2,775

52

3276

8

554

112

6,686

8 Company E

21

1,864

16

1,230

2

163

85

6,100

9 Company F

9

630

1

26

0

0

288

5,982

10 Company G

78

4,787

7

490

5

253

102

5,909

11 Company H

8

227

7

179

98

5,341

116

5,792

12 Company I

29

1,452

3

106

107

3617

139

5,175

13 Company J

13

3,747

4

1164

0

0

17

4,911

14 UCHIYAMA HOLDINGS Co.,Ltd.

53

3,703

15

921

0

0

81

4,838

15 Company K

50

3,525

8

467

5

273

68

4,373

16 ALSOK Group

46

2,165

4

148

6

215

139

4,183

17 Company L

38

1,759

6

122

8

293

159

4,132

18 Company M

0

0

0

0

128

3,998

128

3,998

19 Company N

27

2,118

0

0

16

1141

81

3,970

20 Company O

3

290

0

0

1

20

21

3,510

21 Company P

36

2,082

0

0

0

0

106

3,414

22 Charm Care Corporation

42

2894

4

320

0

0

46

3,214

23 Company Q

8

369

16

366

3

118

87

3,148

24 Super Court Co., Ltd.

17

1097

27

1958

1

59

45

3,114

25 Company R

22

1717

12

650

5

296

44

2,735

26 Company S

3

111

4

102

5

192

59

2,733

27 Company T

5

379

24

2025

0

0

32

2,726

28 Cedar Co., Ltd.

41

2,370

0

0

0

0

44

2,415

29 Company U

21

1,792

0

0

6

494

28

2,313

30 Company V

40

2,060

1

20

4

186

45

2,266

(Note 1) The companies are ranked in descending order according to the number of rooms in the
total column.
(Note 2) The total figures include group homes for the elderly with dementia and other facilities forthe elderly operated by related companies.
(Source) Shukan Koreisha Jutaku Shimbun (Weekly elderly housing newspaper)(Note 3) UCHIYAMA HOLDINGS is a parent company of Sawayaka Club.

(Note 4) The ALSOK Group is the parent company of Wisnet, Co., Ltd.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

42

Management Back-up Agreement

Hokkaido Area
No. of Operators: 5
Asset
Management

NHI
Ownership

Healthcare
facility

Healthcare
facility

Healthcare
facility

A

B

C

Operator

Operator

Operator

A

B

C

Management Back-up Contractors

Asset Management
Company
Each Operator has
concluded amanagement
back-upagreement with
NHI.

Chubu Area
No. of Operators: 4
Chugoku Area
No. of Operators: 5
Tohoku Area
No. of Operators: 4

Discuss handoverof operation toother operators incase ofcontingency

Kanto Area
No. of Operators: 6

Kinki Area
No. of Operators: 8
Shikoku Area
No. of Operators: 4
Kyushu Area
No. of Operators: 5

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

43

Appraisal Value at End of Fiscal Period (as of October 31, 2018)
End of 9th FP

End of 8th FP

Overview of appraisal report
Property nameAppraiser

Appraisalvalue

Direct capitalization method
Price(million yen) (million yen)

DCF method

Cap rate

Price

Discount rate Terminal cap(%)(million yen)rate (%)(%)

Appraisal
NOI(million yen)Appraisal
value

Difference(End of 9th
FP - End of
8th FP)(million yen) (million yen)

Nichii Care Center Fukushima Omori

Japan Real Estate Institute

341

344

5.7

338

5.5

5.9

21

341

-

Sompo Care LAVIERE Hiroshima Hikarigaoka

Japan Real Estate Institute

1,230

1,240

5.2

1,210

5.0

5.4

69

1,230

-

Sompo Care LAVIERE Sagamihara Chuo

Daiw a Real Estate Appraisal

1,780

1,800

4.8

1,770

4.6

5.0

88

1,780

-

Charm Sw eet Ryokuchi Koen

Daiw a Real Estate Appraisal

3,060

3,100

4.6

3,040

4.4

4.8

144

3,060

-

Saw ayaka Kaikyokan

Japan Real Estate Institute

898

907

5.3

889

5.1

5.5

50

898

-

Saw ayaka Meisuikan

Japan Real Estate Institute

813

819

5.3

806

5.1

5.5

47

813

-

Saw ayaka Heart Life Nishikyogoku

Daiw a Real Estate Appraisal

1,140

1,150

5.2

1,130

5.0

5.4

60

1,140

-

Verger Hirakata

Daiw a Real Estate Appraisal

1,590

1,610

5.2

1,580

5.0

5.4

85

1,590

-

Sompo Care LAVIERE Kinugasayama Koen

The Tanizaw a Sōgō Appraisal

2,060

2,080

4.8

2,050

4.9

5.0

100

2,050

10

La'nassica Arakogaw a

The Tanizaw a Sōgō Appraisal

1,430

1,440

5.1

1,420

5.2

5.3

74

1,430

-

Saw ayaka Hinodekan

Daiw a Real Estate Appraisal

920

932

5.0

915

4.8

5.2

47

920

-

Saw ayaka Riverside Kurinoki

Daiw a Real Estate Appraisal

323

329

5.0

321

4.8

5.2

17

323

-

Saw ayaka Obatake Sanbankan

Daiw a Real Estate Appraisal

355

360

5.1

353

4.9

5.3

18

355

-

Super Court JR Nara-Ekimae

The Tanizaw a Sōgō Appraisal

1,750

1,770

5.0

1,740

5.1

5.2

91

1,750

-

Minna-no-ie Omiya Tsutsujigaoka ParkThe Tanizaw a Sōgō Appraisal

776

786

4.9

772

5.0

5.1

39

777

-1

Minna-no-ie Chuo-ku En’nami

Japan Real Estate Institute

860

870

4.9

850

4.7

5.1

44

860

-

Silver Heights Hitsujigaoka No.3

Daiw a Real Estate Appraisal

1,340

1,350

4.9

1,330

4.7

5.1

70

1,340

-

Alpha Living Okayama Nishigawa Ryokudokoen

Daiw a Real Estate Appraisal

787

801

4.5

781

4.3

4.7

37

787

-

Alpha Living Okayama Korakuen

Daiw a Real Estate Appraisal

658

669

4.7

653

4.5

4.9

32

671

-13

Alpha Living Takamatsu Ekimae

Daiw a Real Estate Appraisal

641

652

4.6

636

4.4

4.8

30

641

-

Alpha Living Takamatsu Hyakkenmachi

Daiw a Real Estate Appraisal

626

633

4.7

623

4.5

4.9

31

626

-

Sompo no ie Nishitanabeekimae

The Tanizaw a Sōgō Appraisal

739

748

4.7

735

4.8

4.9

36

739

-

24,117

24,390-23,942

-

-

1,241

24,121-4

Total

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

44

Portfolio List (1)Property nameLocation(residential address)

AccessNichii Care Center
Fukushima Omori

Sompo Care LAVIERE
Hiroshima Hikarigaoka

Sompo Care LAVIERE
Sagamihara Chuo

21-3 Omori Ojibouchi,
Fukushima-shi, Fukushima

2-40 Hikarigaoka,
Higashi-ku, Hiroshima-shi,
Hiroshima

Approximately 2.2km from
Fukushima Station on the
JR Tohoku Main Line

Approximately 1.1km fromApproximately 1.2km from
Hiroshima Station on the JR Sagamihara Station on the
Sanyo Main Line
JR Yokohama Line

Charm Sweet
Ryokuchi Koen

Sawayaka Kaikyokan

3-6-3 Chuo, Chuo-ku,
3-2-21 Nishiizumigaoka,
Sagamihara-shi, Kanagawa Toyonaka-shi, Osaka

1-11-13 Hama-machi,
Wakamatsu-ku,
Kitakyushu-shi, Fukuoka

Approximately 1.4km from
Ryokuchi-koen Station on
the Kita-Osaka Kyuko
Railway Namboku Line

Approximately 1.1km from
Wakamatsu Station on the
JR Chikuhō Main Line

Acquisition price(million yen)

265

960

1,170

1,950

630

Real estateappraisal value(million yen) (Note 1)

341

1,230

1,780

3,060

898

NOI yield (%) (Note 2)

8.3

7.2

7.6

7.4

8.0

Depreciation(million yen) (Note 3)

5

11

10

15

7

Structure / floors (Note 4)

S/3F

RC/7F

RC/5F

RC/6F

RC/B1・5F

Leasable area (m2)

1,964.68

4,133.82

3,732.95

5,329.73

2,694.42

Total leased area (m2)

1,964.68

4,133.82

3,732.95

5,329.73

2,694.42

Number of rooms (rooms)

52

80

80

128

65

Occupancy rate (%) (Note 5)

100.0

93.7

78.7

98.4

95.3

Charm Care Corporation

Sawayaka Club Co., Ltd.

19.8

15.4

Operator
Remaining lease contract
period (year) (Note 6)(Note 1)
(Note 2)
(Note 3)(Note 4)

Nichii Gakkan Company
15.4

Sompo Care Inc.

Sompo Care Inc.
15.4

Appraisal values are as of October 31, 2018.
NOI yields are calculated by dividing the appraisal NOI by the acquisition price.
Figures for depreciation are actual figures of the 9th FP ended in October 31, 2018.
For description of structure, “S” refers to steel-framed structure and “RC” refers to
reinforced concrete structure.

15.4(Note 5) Occupancy rates are obtained by dividing the number of residents indicated in the written
explanation of important matter by the number of rooms, rounded to one decimal place.
(Note 6) Remaining lease contract periods are as of October 31, 2018.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

45

Portfolio List (2)Property nameLocation(residential address)

Access

Sawayaka Meisuikan

Sawayaka Heart Life
Nishikyogoku

Verger Hirakata

5-7-6 Higashinarumizu, 8 Tsutsumishita-cho,
2-20-4 Koyamichi,
Yahatanishi-ku,
Nishikyogoku, Ukyo-ku, Hirakata-shi, Osaka
Kitakyushu-shi, Fukuoka Kyoto-shi, Kyoto
Approximately 2km from Approximately 1.2km
Kurosaki Station on the from Nishikyogoku
JR Kagoshima Main
Station on the Hankyu
Line
Kyoto Line

Sompo Care LAVIERE
Kinugasayama Koen

La’nassica Arakogawa

Sawayaka
Hinodekan

4-8-15 Koyabe,
Yokosuka-shi,
Kanagawa

4-34-1 Takagi-cho,Minato-ku, Nagoya-shi,
Aichi

2-2-33 Hinode,Chuo-ku,
Niigata-shi, Niigata

Approximately 1.4km
from Arakogawa-koen
Station on the Nagoya
Rinkai-kosoku Railway
Aonami Line

Approximately 1.7km
from Niigata Station on
the JR Joetsu
Shinkansen andShinetsu Main Line

Approximately 3.5km
Approximately 1.2km
from Kuzuha Station on from Kinugasa Station
the Keihan Main Lineon the JR Yokosuka
LineAcquisition price(million yen)

590

750

950

1,839

1,279

773

Real estateappraisal value(million yen) (Note 1)

813

1,140

1,590

2,050

1,430

920

NOI yield (%) (Note 2)

8.1

8.1

9.0

5.5

5.8

6.2

Depreciation(million yen) (Note 3)

7

6

10

16

17

8

Structure / floors (Note
4)

RC/6F

RC/B1・6F

RC/5F

S/4F

RC/B1・5F

S/3F

Leasable area (m2)

4,553.67

2,459.19

2,925.25

4,265.88

3,590.40

2,674.37

Total leased area (m2)

4,553.67

2,459.19

2,925.25

4,265.88

3,590.40

2,674.37

Number of rooms(rooms)

87

80

104

104

100

50

Occupancy rate (%)

100.0

94.0

76.6

89.4

98.0

96.0

Sawayaka Club Co.,Ltd.

Sawayaka Club Co.,
Ltd.

Nihon Kaigo
Iryo Center Co., Ltd.

15.4

15.4

15.4

(Note 5)

Operator
Remaining lease
contract period (year)(Note 6)

Sompo Next Inc.
15.9

Sawayaka Club Co.,Ltd.

Cedar Co., Ltd.
9.4

16.1

(Note 1)
(Note 2)
(Note 3)(Note 4)

Appraisal values are as of October 31, 2018.
(Note 5) Occupancy rates are obtained by dividing the number of residents indicated in the written
NOI yields are calculated by dividing the appraisal NOI by the acquisition price.
explanation of important matter by the number of rooms, rounded to one decimal place.
Figures for depreciation are actual figures of the 9th FP ended in October 31, 2018.
(Note 6) Remaining lease contract periods are as of October 31, 2018.
For description of structure, “S” refers to steel-framed structure and “RC” refers to reinforced
concrete structure.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

46

Portfolio List (3)Property nameLocation(residential address)

Access

Sawayaka Riverside
Kurinoki

Sawayaka Obatake
Sanbankan

Super Court JR
Nara-Ekimae

2-2-43 Hinode,Chuo-ku,
Niigata-shi, Niigata

1-6-37 Obatake,
Kokurakita-ku,
Kitakyushu-shi,
Fukuoka

Approximately 1.65km
from Niigata Station on
the JR Joetsu
Shinkansen andShinetsu Main Line

Approximately 280m
Approximately 2.5km
from Kokura Station on from Nara Station on
the JR Kagoshima Main the JR Kansai Main
Line
Line

1-5-35 Omiyacho,
Nara-shi, Nara

Minna-no-ie
Omiya Yoshinocho

Minna-no-ie
Chuo-ku En’nami

Silver Heights
Hitsujigaoka No.3

2-214-3 Yoshinocho,
Kita-ku, Saitama-shi,
Saitama

5-5-17 En'nami,
Chuo-ku, Saitama-shi,
Saitama

15-4-38, Tsukisamu
Higashi Shijo, Toyohiraku, Sapporo-shi,
Hokkaido

Approximately 2.5km
from Miyahara Stationon the JR Takasaki
Line

Approximately 2.4km
from Kitayono Stationon the JR Saikyo Line

Approximately 1.2km
from Nango
Juhatchome Station on
the Tozai Line of the
Sapporo Municipal
SubwayAcquisition price(million yen)

266

289

1,569

740

838

1,200

Real estateappraisal value(million yen) (Note 1)

323

355

1,750

777

860

1,340

NOI yield (%) (Note 2)

6.4

6.5

5.8

5.3

5.3

5.9

Depreciation(million yen) (Note 3)

3

4

17

7

9

8

Structure / floors (Note 4)

S/4F

S/3F

RC/7F

RC/4F

RC/3F

RC/3F

Leasable area (m2)

1,349.39

1,411.78

5,057.07

1,800.03

1,963.03

7,267.56

Total leased area (m2)

1,349.39

1,411.78

5,057.07

1,800.03

1,963.03

7,267.56

Number of rooms (rooms)

33

50

155

33

51

109

Occupancy rate (%) (Note 5)

94.8

94.0

92.9

84.8

80.3

92.7

Sawayaka Club Co.,Ltd.

Sawayaka Club Co.,
Ltd.

Super Court Co., Ltd.

16.1

16.1

20.7

Operator
Remaining lease contract
period (year) (Note 6)

Wisnet Co., Ltd.
18.3

Wisnet Co., Ltd.
25.4

Silver Heights SapporoCo., Ltd.
17.1(Note 1)
(Note 2)
(Note 3)(Note 4)

Appraisal values are as of October 31, 2018.
(Note 5) Occupancy rates are obtained by dividing the number of residents indicated in the written
NOI yields are calculated by dividing the appraisal NOI by the acquisition price.
explanation of important matter by the number of rooms, rounded to one decimal place.
Figures for depreciation are actual figures of the 9th FP ended in October 31, 2018.
(Note 6) Remaining lease contract periods are as of October 31, 2018.
For description of structure, “S” refers to steel-framed structure and “RC” refers to reinforced
concrete structure.
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

47

Portfolio List (4)Alpha Living
Takamatsu
Hyakkenmachi

Property name

Alpha Living
Okayama Nishigawa
Ryokudokoen

Location(residential address)

6-2 Chuo-cho, Kita-ku,
Okayama-shi,
Okayama

1-11-4, Hama, Naka-ku, 1-6, Nishiuchi-machi,
Takamatsu-shi,
Okayama-shi,
KagawaOkayama

8-11, Hyakken-machi,
Takamatsu-shi,
Kagawa1-1-21 Nishitanabe-cho, 1-32-5 Higashi-nogawa,
Abeno-ku, Osaka-shi, Komae-city, Tokyo
Osaka

AccessApproximately 1.5km
from Okayama Stationon the JR Sanyo MainLine

Approximately 1.9km
from Okayama Stationon the JR Sanyo MainLine

Approximately a fiveminute walk from
Takamatsu Station on
the JR Yosan Line

Approximately 1.1km
from Takamatsu
Station on the JR
Yosan Line

Approximately a twominute walk from
Nishitanabe Station on
the Osaka Municipal
Subway Midosuji Line.

Approximately 900
meters from Kitami
Station on the Odakyu
Odawara Line(approximately a 12minute walk)

Acquisition price(million yen)

730

610

605

605

710

394.5

Real estateappraisal value(million yen) (Note 1)

787

671

641

626

739

399

NOI yield (%) (Note 2)

5.1

5.3

5.1

5.2

5.1

4.6

Depreciation(million yen) (Note 3)

7

4

6

6

5

-

Structure / floors (Note 4)

RC/7F

Alpha Living
Okayama Korakuen

RC/4F

Alpha Living
Takamatsu Ekimae

RC/6F

Sompo no ie
Nishitanabeekimae

RC/10F

RC/9F

Irise Komae Bettei

RC/3F

Leasable area (m2)2,124.16

2,128.44

1,848.06

1,929.16

2,095.79

2,016.73

Total leased area (m2)2,124.16

2,128.44

1,848.06

1,929.16

2,095.79

2,016.73

Number of rooms (rooms)

53

45

43

50

42

59

Occupancy rate (%) (Note 5)

76.3

89.5

81.8

83.3

97.6

-

Anabuki Medical CareInc.

Anabuki Medical CareInc.

Anabuki Medical CareInc.

Anabuki Medical Care
Inc.

16.7

16.7

16.7

16.7

Operator
Remaining lease contract
period (year) (Note 6)

Sompo Care Inc.
8.4

HITOWA Care
Services Co., Ltd.
28.3

(Note 1) Appraisal value of "Irise Komae · Bettei" is as of December 1, 2018, other property as of(Note 5) Occupancy rates are obtained by dividing the number of residents indicated in the written
October 31, 2018.
explanation of important matter by the number of rooms, rounded to one decimal place.
(Note 2) NOI yields are calculated by dividing the appraisal NOI by the acquisition price.
（Note6） A part of "Irise Komae · Bettei" (quasi-co-ownership: 30%) is acquired on December 20,(Note 3) Figures for depreciation are actual figures of the 9th FP ended in October 31, 2018.
2018, but the contract remaining period is calculated as of October 31, 2018. Other(Note 4) For description of structure, “S” refers to steel-framed structure and “RC” refers to reinforced
facilities are also as of October 31, 2018.
concrete
structure.
This document
is notmaterial disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

48

Status of Income (Loss) of Investment Real Estate Properties(as of October 31, 2018)(Unit: thousand yen)
8th Fiscal Period (from November 1, 2017 to April 30, 2018)
Property name

Property-related operating expenses

Property-related
operating revenue(Note 1)

Consignment
expensesUtilityexpenses

Taxes anddues

Non-life
insurance
expenses

Repairexpenses

Depreciation

NOI(Note 2)

Other

Nichii Care Center Fukushima Omori

8,185

147

0

1,193

36

245

5,363

1,200

11,578

Sompo Care LAVIERE Hiroshima Hikarigaoka

15,452

580

0

2,891

79

340

11,560036,314

Sompo Care LAVIERE Sagamihara Chuo

14,222

739

0

2,303

79

800

10,300044,497

Charm Suite Ryokuchi Koen

22,392

1,201

0

4,516

108

624

15,941072,299Sawayaka Kaikyokan

14,870

608

0

1,816

77

5,145

7,223

0

20,797

Sawayaka Meisuikan

11,606

571

0

2,806

113

126

7,987

0

24,883

Sawayaka Heart Life Nishikyogoku

9,403

840

0

1,720

51

95

6,694

0

30,555

Verger Hirakata

13,314

624

0

1,900

59

108

10,622042,907

Sompo Care LAVIERE Kinugasayama Koen

22,149

921

0

3,947

96

770

16,414049,892

La’nassica Arakogawa

20,216

645

0

2,248

77

130

17,116

0

37,69910,817

389

0

1,866

52

122

8,387

0

24,119

4,857

133

0

940

27

192

3,564

0

8,625

Sawayaka Obatake Sanbankan

5,326

148

0

825

26

0

4,325

0

9,679

Super Court JR Nara-Ekimae

22,937

1,360

0

2,994

102

646

17,834045,688Minna-no-ie Omiya Tsutsujigaoka Park

10,009

879

0

1,838

42

100

7,149

0

19,783

Minna-no-ie Chuo-ku En’nami

15,180

938

1,861

2,191

44

180

9,963

0

20,174

Silver Heights Hitsujigaoka No.3

15,905

600

0

6,183

136

200

8,784

0

35,119Alpha Living Okayama Nishigawa Ryokudokoen

9,735

377

0

1,685

45

0

7,626

0

18,771

Alpha Living Okayama Korakuen

6,265

342

0

1,572

44

0

4,306

0

16,553Alpha Living Takamatsu Ekimae

8,025

364

0

1,173

39

0

6,448

0

15,686Alpha Living Takamatsu Hyakkenmachi

9,005

366

0

1,649

41

0

6,947

0

15,943

Sompo no ie Nishitanabeekimae

20,162

354

0

1,709

48

13,000

5,049

0

5,550

290,043

13,1381,861

49,973

1,432

22,824

199,6121,200

607,122

Sawayaka Hinodekan
Sawayaka Riverside Kurinoki

Total

Not disclosed

697,552(Note 1) “Property-related operating revenue” is not disclosed property by property because consent for disclosure has not been obtained from tenants.
(Note 2) NOI = Property-related operating revenue − Property-related operating expenses + Depreciation
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

49

Balance Sheets for 9th Fiscal Period Ended October 2018
The 8th FP
ActualAmount(million yen)
Current Assets

1,794

8.5%

Amount(million yen)Amount(million yen)

Ratio

1,876

Current Liabilities

8.9%

2,803

The 9th FP
Actual

Ratio

13.3%

Amount(million yen)

Ratio

3,093

1,404

Operating account payables

58

31

Cash and deposits in trust

429

447

Short-term loans payable

500-

Other current assets

15

24

Current portion of long-termloans payable

2,100

2,900

Accounts payable – other53

69

Advances received

85

85

Other current liabilities

6

6

Tangible fixed assets
Buildings and others(including trust property)
Land and others(including trust property)
Other tangible fixed assets

Intangible fixed assets

19,351

91.5%

19,192

91.1%

19,28491.2%

19,11890.7%

11,335

11,168

7,949

7,949

-

1

42

0.2%

41

Leasehold rights and leasehold
rights in trust

40

40

Other intangible fixed assets

10Investments and other assets

25

Leasehold and security
deposits paid in trust

Long-term prepaid
expenses
Other assets
Total Assets

0.1%

32

10

10

15

22

0

0

21,146 100.0%

Liabilities

1,349

Fixed Assets

AssetsRatio

The 8th FP
ActualFixed Liabilities

0.2%

0.2%

21,068 100.0%

7,930

37.5%

7,630

Long-term loans payable

7,200

6,900

Tenant leasehold and security
deposits

730

730

14.7%

36.2%

10,73350.8%

10,72350.9%

Unitholders’ equity (net)

10,165

48.1%

10,101

47.9%

Unitholders’ equity

10,504

10,504

Deduction from unitholders’ equity

-338

-402

Unappropriated retained earnings

246

1.2%

243

1.2%

10,412

49.2%

10,344

49.1%

Total Liabilities

Net Assets

Cash and deposits

The 9th FP
ActualTotal Net Assets
Total Liabilities and Net Assets

21,146 100.0%

21,068 100.0%

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

50

Status of Unitholders as of the end of October 2018
Major unitholders (top 10)

Ownership ratio of investment units by category
Category of unitholders

Number of units Number of units Increase/decrea
Ratio at theat the end of
at the end of
se from theend of 9th FP*
8th FP
9th FP
previous FP

No.

Name

Number of units Increase/decrea Number of units
Ratio at the end
se from the held at the end ofheld at the end ofof 9th FP*
8th FP
9th
FP
previous FP

Individual/others

35,47434,447- 1,027

46.16%

1

Daiwa Securities Group Inc.

7,600

-

7,600

10.18%

Financial institutions

19,832

18,632- 1,200

24.97%

2

The Master Trust Bank of Japan,
Ltd.(Investment Trust Account)

7,325

- 397

6,928

9.28%

Major city banks

-

-

-

0.00%

3

Japan Trustee Services Bank Ltd.
(Trust Investment Trust Account)

4,649

- 18

4,631

6.21%

Regional banks

493

493

-

0.66%

4

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

2,454

- 163

2,291

3.07%

Trust banks

16,092

15,204- 888

20.37%

5

BNYM AGT/CLTS 10 PERCENT

-

2,000

2,000

2.68%

Life insurancecompanies

286

286

-

0.38%

6

SCB SG S/A SCB THAILAND AC FOR
CIMB-PRINCIPAL PROPERTY
JP000294300545

953

749

1,702

2.28%

Non-life insurancecompanies

-

-

-

0.00%

7

Trust & Custody Services Bank Ltd.
(Trust Investment Trust Account)

1,282

- 249

1,033

1.38%

Other financial
institutions

2,961

2,649

- 312

3.55%

8

Daiwa Real Estate Asset Management
Co. Ltd.

1,000

-

1,000

1.34%

Other domestic companies

12,273

12,228- 45

16.38%

9

Fukui Medical Credit Association

945

-

945

1.27%

Foreigners

6,199

8,281

2,082

11.10%

10

UENOYA BUILDING Co. Ltd.

903

-

903

1.21%

Securities companies

854

1,044

190

1.40%

27,111

1,922

29,03338.90%

Total

74,632

74,632-100.00%

Total*Rounded to two decimal places.

*Rounded to two decimal places.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

51

IR Activities / Indices that include NHI
Held IR in regions of the country
Month / Year

Name of IR Event

LocationJanuary 2018

Briefing session on asset management for individual investors (7th FP)

Tokyo

February 2018

Special seminar for healthcare facility operators

Osaka

February 2018

Seminar for individual investors (sponsored by a security company)

March 2018

TSE IR Festa 2018

Tokyo

March 2018

Special seminar for healthcare facility operators

Tokyo

June 2018

Financial results briefing for institutional investors (8th FP)

Tokyo

July 2018

Briefing session on asset management for individual investors (8th FP)

Tokyo

July 2018

Seminar for individual investors (sponsored by a security company)

Tokyo

September 2018

J-REIT Fair for individual investors 2018 (cosponsored by ARES and TSE)

Tokyo

October 2018

Special seminar for healthcare facility operators

SapporoYokohama

J-REIT Fair for individual investors 2018 (cosponsored by ARES and TSE)

Indices that include NHIMonth / Year

Name of index

September2015 disclosed
Thomson
Reuters
GPR/ APREA
Composite
Index Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
This document
is not material
in compliancewith theFinancial
Instruments
and Exchange
NHI advises readers to make investment decisions at their own judgment.

52
53

IR Schedule

IR schedule

・Fiscal period ends: April and October ・Securities code: 3308
Nov.

Announcement offinancial results

Dec.

●

Jan.

Feb.

Mar.

Announcement of financial results
for fiscal period ended October

Payout of
distributions●

Commencement of payout of distributions
for fiscal period ended OctoberAsset management
report●Sending of asset management reportfor fiscal period ended OctoberMay
Announcement offinancial results

June

●

Apr.

July

Aug.

Sept.

End offiscal period

Oct.

Announcement of financial results
for fiscal period ended April

Payout of
distributions●

Commencement of payout of distributions
for fiscal period ended April

Asset management
report●Sending of asset management reportfor fiscal period ended April

End offiscal period

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

53

Guide to Website (http://www.nippon-healthcare.co.jp/en/)
Provides details on real estate under management, IR mail delivery service, etc.
Securities code

3308

・What are healthcare facilities?
・What are healthcare REITs?
・Guide to portfolio
・Unitholder benefits
・Introduction of operators

 IR mail delivery service

registration form
Service delivering the latest news releases,
occupancy rates, etc.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

54

Framework of stable cash flow

Operator’s Income

REIT’sIncomeDistribution
to Investors

Fixed rent

Dividends

Advance fees
Residents
Monthly charges,etc.

Municipalities, etc.

Nursing care service
operators

Long-term leaseagreements

Nippon Healthcare
Investment
Corporation

Investors
投資主
Investment

Nursing care fees

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

55

Support and Independence<Same boat investment in NHI by the Daiwa
Securities Group Inc.>
Holding 10.2% of NHI’s investment units issued

Operator

Investment Corporation<Conclusion of sponsor support agreement>

AssetManagement

Cooperation in securement of personnel
Provision of information on properties, etc.

Asset Management Company

Charm Care Corporation
Super Court Co., Ltd.
Sompo Care Inc.
Sawayaka Club Co., Ltd.
Nichiigakkan Company
Cedar Co., Ltd.
Nihon Kaigo Iryo Center Co., Ltd.
Wisnet Co., Ltd.
Silver Heights Sapporo Co., Ltd.
Anabuki Medical Care Inc.
HITOWA Care Services Co., Ltd.

<Conclusion of advisory agreement>
Provision of information on
management/operation of healthcare facilities
Provision of advisory work such as assisting andsupporting negotiations with operators
Provision of advice on market research/analysis
concerning assets under investment target<Invested 100% by Daiwa Securities Group Inc.>

SponsorAdvisorSupport56
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

56

Overview of Asset Management Company (1)Corporate Profile

Directors
As of December 1, 2018

Corporate nameDaiwa Real Estate Asset Management Co. Ltd.

Address

6-2-1 Ginza, Chuo-ku, Tokyo

Established

October 21, 2004

Paid-in capital

200 million yen

Representative Director

Akira Yamanouchi

Board of Directors

10
Executive directors: 5 / Executive auditors: 1
Non-executive directors: 2 / Non-executive auditors: 2

No. of Employees

108 (excluding dispatched employees)

Registered financial
instruments firm

Registration No. 355 (Financial Instruments),
Director-General, Kanto Local Finance Bureau (Kinsho)

Building lots andbuildings transaction
business license

License No. (3) 83920, Governor of Tokyo

Discretionary agent forreal estate transaction
approval

License No. 34, Minister of Land, Infrastructure,
Transportation and Tourism

Association membership

Member of The Investment Trusts Association, Japan
Member of Japan Investment Advisers Association
Member of Type II Financial Instruments Firms
Association

As of December 1, 2018
President and Representative
Director
Vice President andRepresentative Director
Vice President andRepresentative Director

Akira Yamanouchi
Yuji Shinotsuka
Yoshiki Nishigaki

Executive Managing Director

Toshio Fukushima

Director

Hajime Imbe

Director (non-executive)

Mikita Komatsu

Director (non-executive)

Keiichi Ishikawa

AuditorTamaki Shibayama

Auditor (non-executive)

Morimasa Matsuda

Auditor (non-executive)

Shinji Kiso

REITs which entrust the asset management to
the Asset Management Company
As of December 20, 2018

Daiwa Office Investment
Corporation

Listed REIT focusing on office buildings
Asset size: approximately 459.7 billion yen(58 properties)(*)

Japan Rental Housing
Investments Inc.

Private REIT focusing on residential properties
Asset size: approximately 225.5 billion yen(198 properties)

Daiwa Residential Private
Investment Corporation

Unlisted REIT focusing on residential properties
Asset size: approximately 110.0 billion yen(71 properties)

Nippon Healthcare Investment
Corporation

Jap an’s first listed REIT focusing on healthcare facilities
Asset size: approximately 19.7 billion yen (23 properties)

Daiwa Hotel Private Investment Private REIT focusing on hotels
Asset size: approximately 9.2 billion yen (3 properties)
Corporation（*） excluding silent partnership equity interest
This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

57

Overview of Asset Management Company (2)Organization of Asset Management Company
Shareholders’ Meeting
Corporate Auditors
Board of Directors
Compliance Committee
Compliance Officer
Investment Committee (*)
President andRepresentative Director* Set up separately for each
investment corporation

Internal Control OfficeAcquisition and AssetManagement Division

Acquisition
Department

Origination
Department

Asset
Management
Department

Corporate Division

Private Fund Division

JRH
Management
Department

Private FundManagement
Department

Customer
Relations
Department

Finance
Department

Administration
Department

Office Investment
Team

Office ManagementTeam

AM TeamFinance Team

Residential
Investment Team

Residential
Management Team

Portfolio System
Team

Accounting Team

Healthcare
Investment Team
Hotel InvestmentTeam
JRH Investment
Team

Healthcare
Management Team

Corporate
Planning
Department

Compliance &Risk Management
Dept.

Management Team

Hotel
Management Team
Investment Planning
Team
Construction
Management Team

as of 1 December, 2018

This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

58This document is not material disclosed in compliance with the Financial Instruments and Exchange Act or any regulation of similar nature, nor is it intended for the purposes of solicitation.
NHI advises readers to make investment decisions at their own judgment.

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