October 27, 2006
For Immediate Release
LCP Investment Corporation
Nihon-bashi Nishikawa Bldg,
1-5-3 Nihon-bashi, Chuo-ku, Tokyo
Shunji Miyazaki: Executive Officer(Securities Code: 8980)
LCP REIT Advisors Co., Ltd
Nihon-bashi Nishikawa Bldg,
1-5-3 Nihon-bashi, Chuo-ku, Tokyo
Shunji Miyazaki: CEO
Inquiries:
The LCP REIT Advisors Co., Ltd
CFO

Yuji Kubo

TEL: +81-3-3272-7311

Notice Concerning Acquisition of Assets andForecasts of Financial Results for the Fiscal Periods Ending August 31, 2007
LCP Investment Corporation (the “Investment Corporation”) is pleased to announce that theInvestment Corporation has determined to acquire 3 properties today.

Details of the acquisition are

as follows. In addition, Investment Corporation announces the forecasts of the investment
performance of LCP Investment Corporation for the period ending August, 2007.
1, Assets Summary(1) Lexington Square Fushimi① Property Name : Lexington Square Fushimi② Type of Scheduled Acquisition : Trust beneficiary interest③ Category of Properties : Residential④ Scheduled Acquisition Price (*1) : 2,990 million yen⑤ Scheduled Date of Purchase Agreement : October 27, 2006
⑥ Scheduled Date of Acquisition : October 31, 2006
⑦ Seller (*2) : Toyota Tsusho Corporation⑧ Acquisition Funds : Borrowing funds are scheduled.
⑨ Collateral : None(2) Bon Sejour Musashi Shinjo① Property Name : Bon Sejour Musashi Shinjo② Type of Scheduled Acquisition : Real Estate Property③ Category of Properties : Senior ( Fee-based senior citizens home)④ Scheduled Acquisition Price (*1) : 610 million yen⑤ Scheduled Date of Purchase Agreement : October 27, 2006
⑥ Scheduled Date of Acquisition : November 30, 2006 or the date as may be agreed upon by the
Seller and the Buyer until November 30, 2006
⑦ Seller (*2) : Zecs Community Corporation (*3)
⑧ Acquisition Funds : Borrowing funds are scheduled.
⑨ Collateral : None
(3) Lexington Plaza Hiroshima Otemachi (Comfort Hotel Hiroshima Otemachi)① Property Name : Lexington Plaza Hiroshima Otemachi② Type of Scheduled Acquisition : Trust Beneficiary Interest③ Category of Properties : Others (Hotel)④ Scheduled Acquisition Price (*1) : 2,450 million yen⑤ Scheduled Date of Purchase Agreement : October 27, 2006
⑥ Scheduled Date of Acquisition : The date as may be agreed upon by the Seller and the Buyer
before November 30, 2006
⑦ Seller (*2) : Zecs Co., Ltd⑧Acquisition Funds : Borrowing funds are scheduled.
⑨ Collateral : None(*1) Scheduled Acquisition Price excludes acquisition fee, fixed asset tax, city planning tax andconsumption tax etc. The amount less than a million yen are rounded off to the nearest million yen.
(2*) Please refer to 6. “Seller’s Profile”(3*) Please refer to 4. Management of Fee-based senior citizens home
2, Reason for Acquisition
The Investment Corporation acquires three properties shown above to aim the expansion of excellent
residential, senior-oriented properties and LCP-styled properties and to secure stabilized mid-to-longterm profits and the steady growth of the operating assets in accordance with “Asset Management
Target and Policy”prescribed for by the Articles of Incorporation of the Investment Corporation.
3, Summary of Property
Please refer to [Exibit] Summary of Scheduled Acquisition Properties

4, Management of Fee-based senior citizens home
① Management
With respect to the management of senior-oriented properties, such properties will be managed
efficiently by using the know-how of Zecs Co., Ltd which has an experience of the management ofsenior-oriented properties and parent company of Zecs Real Estate Investment Advisory Co., Ltd (aShareholder of Asset Management Company). So far, Zecs Co., Ltd have developed total 19
senior-oriented properties such as 3 senior housings for healthy residents “Charming Series”, 15
fee-paying seniors homes with care “Bon Sejour Series”(including the said property) and 1 othersenior housing. Zecs Community Corporation which is the seller of the said property andconsolidated affiliate company of Zecs Co., Ltd manages total 17 senior-oriented properties except 2
senior housings for healthy residents “Charming Series”.
② Establishment of Back-up Operator
To improve the management stability, taking the public and social work of senior house’s operation
into consideration, in principle, the Investment Corporation establishes Back-up Operator which
manages and leases the properties instead of operator in certain cases including the case that an
operator caused rent default for certain period or became bankrupt. From the aforementioned, it isconsidered to be able to provide more stable service for residents.

In addition to being Back-up

Operator of fee-based senior citizens homes which have already been owned by the Investment
Corporation (Bon Sejour Chitose-Funabashi, Bon Sejour Yotsugi, and Bon Sejour Hino), Japan Care
Service Co., Ltd is scheduled to become a Back-up Operator of the said property based on a
Memorandum executed by Japan Care Service Co., Ltd. and certain other parties.

Japan Care

Service Co., Ltd. is a listed company on Jasdaq Securities Exchange.
5, The matter related to resistance against earthquake
The adequacy of structural calculation of 3 properties shown above has been reported by thethird-party institution through investigation as follows.
① Investigator
Company’s Name

Tokio Marine & Nichido Risk Consulting Co., Ltd

Location (Head office)1-2-1, Marunouchi, Chiyoda-ku, Tokyo

Representative

Tomohisa Yamada

Capital1,000,000,000 yen

Business Activities

Due Diligence of Real Estate etc

Relationship with the Investment Corporation

None② Matter of Investigation: Verification and Inspection of Structural Calculation and related Design
and Specifications

③ Result of Investigation: The structural design was made adequately and in compliance with the
Building Standard Law, Cabinet Order and Proclamation concerning the law, and each structuraldesign standards.
6, Seller’s Profile(1) Lexington Square Fushimi
Company’s Name

Toyota Tsusho Corproation

Location (Head office)4-9-8, Mei-eki, Nakamura-ku, Nagoya-shi, Aichi

Representative

Junzo Shimizu

Capital26,748,000,000 yen ( as of April 1, 2006)

Business Activities

Domestic trade, Export and Import trade, Foreign trade, Bldg construction constructor,
Insurance agent etc(2) Bon Sejour Musashi-Shinjo
Company’s Name

Zecs Community Corporation

Location (Head office)1-1-7, Uchisaiwai-cho, Chiyoda-ku, Tokyo

Representative

Hideyo Honma

Capital80,000,000 yen ( as of May 31, 2006)

Business Activities

Management regarding Senior houses and Fee-based senior citizens home

Relationship

with

the

Investment Corporation

Zecs Community Co., Ltd is a consolidated affiliate company of Zecs Co., Ltd which isthe parent company of Zecs Real Estate Investment Advisory Co., Ltd which holds
7.07% of shares in the Asset Management Company.

(3) Lexington Plaza Hiroshima Otemachi
Company’s Name

Zecs Co., Ltd

Location (Head office)1-1-7, Uchisaiwai-cho, Chiyoda-ku,Tokyo

Representative

Hiroyuki Hirayama

Capital2,675,976,000 yen ( as of May 31, 2006)

Business Activities

Real estate consulting /Senior housing & service / Resort & other facilities
management

Relationshipwith

Investment CorporationtheZecs Co., Ltd which is the parent company of Zecs Real Estate Investment AdvisoryCo., Ltd which holds 7.07% of shares in the Asset Management Company.

7, Seller’s Situation(1) Lexington Square Fushimi
None(2) Bon Sejour Musashi-Shinjo
Previous Owner

Owner

beforeprevious owner
Company’s Name

Zecs Community Corporation

Exceptspecialstakeholder
Relationship with special

Party similar to Sponsor-related parties under the self

stakeholder

regulation of the Asset Management Company

Circumstances /Reason of

Acquire in order to manage fee-based senior citizens home

Transaction
Acquisition Price

Omission ( It has been owned more than 1 year)

Acquisition Date

March, 2005

(3) Lexington Plaza Hiroshima Otemachi
Previous Owner

Owner

beforeprevious owner
Company’s Name

Zecs Co., Ltd

Relation ship with special

Party similar to Sponsor-related under the self regulation

stakeholder

of Asset Management Company

Circumstances/Reason

of

None

Property developed by previous ownerTransaction
Acquisition Price−

Acquisition Date−

8, Transaction with Stakeholder etc(1) Lexington Square Fushimi
Toyota Tsusho Corporation (the Seller of the aforementioned property) does not correspond to theRelated-Parties, etc. under Investment Trusts Law and Sponsor-related party (*) under the
self-regulation provided for the measure of conflict of interests concerning asset management of
Investment Corporation by Asset Management Company.

However, the land of this property wasonce owned by Yahagi Jisho Co., Ltd. (which is a subsidiary of the Asset Management Company’ssponsor, Yahagi Construction Co., Ltd) and transferred to Toyota Tsusho Corporation with thecondition that Toyota Tsusho Corporation shall entrust the construction of the building on the land to
Yahagi Construction Co., Ltd.

In addition, Yahagi Construction Co., Ltd recommended Toyota

Tsusho Corporation to sell this property to the Investment Corporation. Therefore, the acquisition ofthis property was deliberated and resolved in accordance with the self-regulation concerning
Sponsor-related businesses provided for the measure of conflict of interests concerning asset
management of Investment Corporation by Asset Management Company.

(2) Bon Sejour Musashi-Shinjo
Zecs Community Co., Ltd (Seller of the aforementioned property) is a consolidated affiliatecompany of Zecs Co., Ltd which is the parent company of Zecs Real Estate Investment Advisory Co.,Ltd.

Zecs Real Estate Investment Advisory Co., Ltd. holds 7.07% of shares in the AssetManagement Company.

Therefore, Zecs Community Co., Ltd is similar to Sponsor-related party(*) under the self-regulation provided for the measure of conflict of interests concerning asset
management of Investment Corporation by Asset Management Company. Therefore, with respect
to the execution of the Transfer Agreement related to the acquisition of the aforementioned property,
it was deliberated and resolved in accordance with the said self-regulation.

The Investment

Corporation is scheduling to entrust property management business to Zecs Community Corporation
through leasing the aforementioned property to the corporation.

The said transaction was alsodeliberated and resolved in accordance with the self-regulation concerning the aforementioned
measure of conflict of interests.
(3) Lexington Plaza Hiroshima Otemachi
Zecs Co., Ltd (Seller of the aforementioned property) is the parent company of Zecs Real Estate
Investment Advisory Co., Ltd which holds 7.07% of shares in the Asset Management Company.
Therefore, Zecs Co., Ltd is similar to Sponsor-related party (*) under the self-regulation provided forby the measure of conflict of interests concerning asset management of Investment Corporation by
Asset Management Company.

Therefore, with respect to the execution of the Transfer Agreement

related to the acquisition of the aforementioned property, it was deliberated and resolved inaccordance with the said self-regulation.

Tozai Asset Management Co., Ltd, which is a master

lease company regarding 1st and 2nd Floor of the aforementioned property, is also similar toSponsor-related party (*) under the self-regulation provided for the measure of conflict of interests
concerning asset management of Investment Corporation by Asset Management Company. The
said transaction was also deliberated and resolved in accordance with the self- regulation concerning
the aforementioned measure of conflict of interests.
(*) Sponsor- related party means(a) Party or person who correspond to Related-Parties, etc. defined by the Law concerning Investment Trusts andInvestment Corporation,(b) All shareholders of Asset management Company, and(c) (i) Special Purpose Company which entrusts its asset management to a party or a person corresponding to (b)above, (ii) Special Purpose Company shares in which are held by a party or a person corresponding to (b) above,or (iii) Special Purpose Company Tokumei Kumiai Mochibun (note) in which are held by a party or a person
corresponding to (b) above.
(note) Tokumei Kumiai Mochibun means equity interests of capital contribution in undisclosed associations

9, Brokerage Profile(1) Lexington Square Fushimi
The Chuo Mitsui Trust and Banking Company, Limited mediate the property’s transaction between
the Investment Corporation and Toyota Tsusho Corporation as a broker.

The Chuo Mitsui Trust andBanking Company, Limited does not correspond to Sponsor-related party under the self-regulation
provided for the measure of conflict of interests concerning asset management of Investment
Corporation by Asset Management Company.

Regarding the property’s acquisition, the Investment

Corporation pays ¥89,700,000 (excluding tax) as a brokerage fee to The Chuo Mitsui Trust andBanking Company, Limited.
(2) Bon Sejour Musashi-Shinjo
The Chuo Mitsui Trust and Banking Company, Limited mediate the property’s transaction between
the Investment Corporation and Zecs Community Corporation as a broker.

The Chuo Mitsui Trustand Banking Company, Limited does not correspond to Sponsor-related party under the
self-regulation provided for the measure of conflict of interests concerning asset management of
Investment Corporation by Asset Management Company.

Regarding the property’s acquisition, theInvestment Corporation pays ¥6,100,000 (excluding tax) as a brokerage fee to The Chuo Mitsui
Trust and Banking Company, Limited.
(3) Lexington Plaza Hiroshima Otemachi
The Chuo Mitsui Trust and Banking Company, Limited mediate the property’s transaction between
the Investment Corporation and Zecs Community Corporation as a broker.

The Chuo Mitsui Trustand Banking Company, Limited does not correspond to Sponsor-related party under the
self-regulation provided for the measure of conflict of interests concerning asset management of
Investment Corporation by Asset Management Company.

Regarding the property’s acquisition, theInvestment Corporation pays ¥24,500,000 (excluding tax) as a brokerage fee to The Chuo Mitsui
Trust and Banking Company, Limited.
10, Form of Payment
With respect to the aforementioned 3 properties, the Investment Corporation plans a package
payment of the acquisition price to the seller at the time of the scheduled date of acquisition.
11, Forecasts of Financial Results
Influence of the acquisition to the financial result of the Investment Corporation for the fiscal period
ending February 28, 2007 (from September 1, 2006 to February 28, 2007) is considered to beimmaterial.

Therefore, there is no change concerning the forecasts of financial results.

The

forecasts of financial results for the fiscal period ending August 31, 2007 ( March 1, 2007 〜August
31, 2007) is shown below

Operating revenue: 2,038 million yen

Ordinary profit: 713 million yen

Net profit: 712 million yen

Dividends per unit

: 12,000 yen

Excess profit distribution per unit

: − yenWith respect to the precondition of the aforementioned forecasts of Financial Results, please refer to[Appendix 3] the precondition of forecasts of financial results for the fiscal period ending August 31,
2007.
(*)
1,

The forecast figures above are the current figures calculated under [ Appendix 3] the preconditions of forecasts offinancial results for the fiscal period ending August, 2007 , and the actual operating revenue, net profit anddividend per unit are subject to change due to factors such as the acquisition or sale of assets, changes in the realestate and financial market, and changes in the environment surrounding the Investment Corporation.

Inaddition, these forecasts do not guarantee the amount of the dividend.
2,

When it is anticipated that there will be differences in the forecast figures above that are greater than a certain
degree, the forecast figures may be revised.

3, The forecast figures are rounded off.

＊ This document is being distributed today to Kabuto Club (the press club of the TSE) as well as to the press clubfor the Ministry of Land, Infrastructure and Transport Ministry and the press club for specialty construction
newspapers at the Ministry of Land, Infrastructure and Transport.
＊ The web site of the Investment Corporation : http://www.lcp-reit.co.jp＊ This English language notice is a translation of the Japanese language notice issued on the same day and was
prepared solely for the convenience of, and reference by, overseas investors. LCP Investment Corporation
makes no warranties as to its accuracy or completeness.

[Exibit]
Summary of Scheduled Acquisition Property (1) Lexington Square Fushimi
Category : Residential
No. R-23
Property Name : Lexington Square Fushimi
Property Feature
The property is a luxury apartment for rent , located in 6 mins walk towards south-east from “Kokusai Center ”station （Sakura-dori line).
accessibility ( 12 mins walk to “Nagoya”station and 7 mins walk to “Fushimi”station (Higashiyama-line) ).

It also has a very highThere are accumulated commercial facilities around

Nagoya station as well as cultural facilities around the property. Additionally, it has a very good access to Sakae area where is one of the center of commercial
area.

It is expected that there exist high demand for city resident due to the superb location.
Address

1-8-49, Nishiki, Naka-ku, Nagoya-shi, Aichi

Land No,

1-801-2, Nishiki, Naka-ku, Nagoya-shi, Aichi

Location

Type pf

Property Type

Number of unit

Ratio of unit

Ratio of area

Compact＿＿＿

Spacious

123

100％

100％

Others＿＿＿Ownership rightOwnershipLand

1,260.8 ㎡

Site area

Summary of Engineering Report (＊1) (Unit: ,000 yen)
Tokio Marine & Nichido Risk Consulting Co.,

Floor area ratio

600％

Investigation Company
Ltd

Bldg coverage
80％

Time of Investigation

September 22, 2006

ratio
Type of ownership

Ownership right

Usage

Apartment

Urgent＿Within 1 year＿

Repairing cost
Average cost for
7,884.6 ㎡

Floor space¥904,000
12 years

RC,15th Floor

Structure/Number

Earthquake

PML

6.9%

of floor
Bldg

Completion date

September , 2006

Bldg Inspection

Japan ERI Co., Ltd

Summary of Real Estate Appraisal Report (＊ 1) （Unit：million yen）
Tanizawa Sogo Appraisal Co., Ltd

Appraiser

AgencyYahagi Construction Co., Ltd
Architect

Office of a licensed architect of the

Appraisal Date

September 30, 2006

first class
Constructor
Current Owner

Yahagi Construction Co., Ltd
Toyota Tsusho Corporation

3,030

Appraisal Value
Capitalization approach price

The Chuo Mitsui Trust and Banking

Price calculated by the direct

Company, Limited

capitalization approach

Trustee

3,030
3,040

Scheduled expiration date ofJanuary 31, 2016
trust term

Gross income

222

ＰＭ Company

SBA Management Co., Ltd

Master Lease Company

SBA Management Co., Ltd

Rental income

202

Type of Master lease

Pass through

Other income

20[Exibit]
Summary of Scheduled Acquisition Property (1) Lexington Square Fushimi
Category : Residential
No. R-23
Property Name : Lexington Square Fushimi

Lease Details （unit：¥,000）
Investigation date

October 31, 2006

Total expenses

55

NOI

183

NCF

167

Capitalization rate

5.5 ％Price calculated by the
Total number of Tenant

1

3,020
Discounted Cash Flow Approach

The number of leasable unit

123 units

Discount rate

5.5%

Leasable floor area

7,022.7 ㎡

Terminal Cap Rate

5.8％

＿

Floor area
Monthly rent （Assume no

Cost approach price

2,150

＿

Land Price

570＿

Bldg Price

1,580

17,599vacancy）
Deposit/Security deposit
Occupancy rate（based on
area）
Scheduled acquisition price (Unit: ¥ million)

2,990

Notes
Fixed-rent master lease agreement is scheduled to be executed with SBA Management Co., Ltd (a master lease company). The fixed rent amount will be 90% of
total monthly rent amount paid by end tenants assuming that there is no vacancy. Rent guarantee period will be 6 months from November 1, 2006 and the contract
period will be 2-years.
(＊1) the Investment Corporation makes no warranties as to accuracy or completeness of the description in the column “Summaryof Engineering Report” and “Summary of Real Estate Appraisal Report.”

[Exibit]
Summary of Scheduled Acquisition Property (1) Bon Sejour Musashi-Shinjo
Category : Senior
No. S-4
Property Name : Bon Sejour Musashi-Shinjo
Property Feature
The property is a fee-based senior citizens' home, located in 13 mins by walk from “Musashi-Shinjo”station (JR Nambu-line). There is commercial andresidential area on the way to the property and 18 medical facilities within radius 1 km.

It is also surrounded by natural environment.

As a result, it isconsidered to be superb location as a senior house. The property was converted to senior house by a big-scale reconstruction in Feb, 2005. Also the Bldg
equipment and service are satisfactory level. Therefore, it is supposed to have high competitiveness, even compared to newly-built properties.
Address

773-2, Chitose, Takatsu-ku, Kawasaki-shi, Kanagawa

Land No,773-2, Chitose-aza-kitaura, Takatsu-ku, Kawasaki-shi, Kanagawa

Location
Type of ownershipArea for use

Ownership rightCategory 1 residential district
1,233.5 ㎡

Site area

Summary of Engineering Report (*1) (Unit : ¥,000)

Land

Tokio Marine & Nichido Risk Consulting Co.,
60 ％Floor area ratio

Investigation Company
Ltd

Bldg coverage
200 ％Time of Investigation

August 31, 2006

ratio
Type of ownership

Ownership right

Usage

Senior housing

Urgent_Within 1 year_

Repairing cost
Average cost for
1,710.4 ㎡

Floor space¥1,40012 years

Structure/Number
RC, 4th Floor

Earthquake

PML

11.9%

of floor
Bldg
Completion dateFeb, 1985

Bldg Inspection

Governmental body (Kawasaki-city)

Summary of Real Estate Appraisal Report (＊ 1) （Unit：million yen）
Japan Real Estate Institute

Appraiser

AgencyOhki Corporation-licensed architect
ArchitectAppraisal Date

August 31, 2006

officeConstructor

Ohki Corporation

Current Owner

Zecs Community Corporation

Previous Owner

Sumitomo Life Insurance Company

Appraisal Value

610

Capitalization approach price610

Price calculated by the direct
615
capitalization approach＿

Trustee

Gross income
PM Company

44

Zecs Community Corporation＿

Master Lease Company

Rental income

44

Other income

0Net-lease, Long-term contract,
Type of Contract
Block rental
Leasing condition (Unit: ¥,000)

Total Expenses

3Time of Investigation

November end, 2006 (scheduled)

NOI

41

Total number of tenant

1

NCF

40

[Exibit]
Summary of Scheduled Acquisition Property (1) Bon Sejour Musashi-Shinjo
Category : Senior
No. S-4
Property Name : Bon Sejour Musashi-Shinjo
The number of ｌeasable unit

46 units

Capitalization rate

The number of occupancy

6.5％

Price calculated by the Discounted
42 units

604

unit (as of Sep end)

Cash Flow Approach

Leasable area

1,710.4 ㎡

Discount rate

6.2％

Lease area

1710.4 ㎡

Terminal capitalization rate

6.8％

Monthly rent fee

3,507

Cost approach price598

Deposit/ Guaranty fee

19,980Land Price

359

100％

Bldg Price239

Occupancy ratio (based on
area)
Scheduled Acquisition Cost (Unit : ¥million)
Notes
None
(＊1) the Investment Corporation makes no warranties as to accuracy or completeness of the description in the column “Summaryof Engineering Report” and “Summary of Real Estate Appraisal Report.”

610

<Trade Area Environment> Bon Sejour Musashi-Shinjo
Outline of Trade Area
The property is located in quiet residential area, 13 mins walk from “Musashi-shinjo”station.
zone of the property is estimated to be around Takatsu-ku, Kawasaki-city.

Potential demand

The main user is supposed to be seniorcitizens over 75 years old (the “late old-aged persons”), whose population in Kawasaki city is 77,061 as of October,2005. The population of late old-aged persons is estimated to be 121,231 in 2014. Therefore, the number of thepotential user is supposed to increase in future.
Facilities Features
The property is fee-based senior citizens home under the Elderly Welfare Law and Social facilities with nursing
care except close area type under the Nursing Care Insurance Law.

In addition, users of this property have theright to use this property for the rest of their life. The number of unit is 43 units for single and 3 units for couple.
The facilities prescribed for by the guideline of fee-based senior citizens’ home are arranged. The main feature is
the introduction of the exclusive floor (2nd Floor) for elderly patients with dementia. The patients are also able tohave a meal in the dining room on the 2nd floor.
Data etc■ Ratio of the population of the late old-aged
C.Population
A. Population of the

B. Total

Ratio of （The late

Ratio of（The lateof thelate old-aged

population

old-aged/Total population）

old-aged/The old-aged）
old-aged

Kawasaki-city

77,061

1,317,407

5.8％

192,227

40.0％（*1）The late old-aged means senior citizens over 75 years old. The old- aged means senior citizens over 65
years old.
（*2）Source：Kawasaki-city “The third term nursing care business project, October 2005”■ Forecasts of Total population and The population of the late old-aged in Kawasaki city
2006

2008

Population ofPopulation of

Total

Population of

Total
the late

population

Ratio

82,556Total
the late

population

old-aged

1,324,813

2016

Ratio

the late
population

old-aged

6.2％

1,343,292

93,028old-aged

6.9％

1,384,179

121,231（*）Source：Kawasaki-city “The third term nursing care business project, October 2005”(*) The aforementioned column of “Outline of Trade Area”, “Facilities Features”and “Date etc”is extracted orsummarized from the appraisal report by Tamura Planning & Operating and Japan Real Estate Institute.

Therefore,

with respect to the said each property’s appraisal, the Investment Corporation makes no warranties as to its accuracy
or completeness.

Ratio

8.8％

[Exibit] Summary of Scheduled Acquisition Property(3) Lexington Plaza Hiroshima Otemachi (Comfort Hotel Hiroshima Otemachi)
Category : HotelNo. O-9
Property Name : Lexington Plaza Hiroshima Otemachi
Property Feature
The property is located in the center of governmental offices area where there are Hiroshima City Council, Naka-ku Council, Hiroshima Post Office etc. The
property is located at good place as a business hotel because it is 2 mins walk from, the property to “Nakaden-mae” Station (Hiroshima Dentetsu) and the property
is 930 m away from Bus Center.

Due to the good accessibility for business and sightseeing, located in the center of politic and economy in Hiroshima-city,

46.9 % of all hotels in Hiroshima city is located in Naka-ku where the property locates.

Therefore, it is expected to secure the stable profit due to enough demandas business hotel.
Address

3-7-9, Otemachi, Naka-ku, Hiroshima-shi, Hiroshima

Land No,

7-10 other 1 number, Otemachi, Naka-ku, Hiroshima-shi, Hiroshima

Location

Type of Ownership

Ownership right

Use area

Commercial area

Site area

819.7 ㎡

Summary of Engineering Report (＊1) (Unit: ,000 yen)

Land
Tokio Marine & Nichido Risk Consulting Co.,
Floor area ratio

800％

Investigation Company
Ltd

Bldg coverage
100％

Time of Investigation

August 31, 2006

ratio
Type of ownership

Ownership right

Usage

Hotel, Shop

Urgent＿Within 1 year＿

Repairing cost
Average cost for
6,977.1 ㎡

Floor space¥4,126,000
12 years

Structure/Number

S,14th Floor
Earthquake

PML

8.3%

of floor
Bldg

Completion dateAugust , 2006

Bldg Inspection

Japan ERI Co., Ltd

Summary of Real Estate Appraisal Report (＊ 2) （Unit：million yen）
Tanizawa Sogo Appraisal Co., Ltd

Appraiser

AgencyYahagi Construction Co., Ltd
Architect

Office of a licensed architect of the

Appraisal Date

September 15, 2006

first class
Constructor

Yahagi Construction Co., Ltd

Current Owner

Zecs Co., Ltd

Appraisal Value

2,450

Capitalization approach price

The Chuo Mitsui Trust and Banking

Price calculated by the direct

Company, Limited

capitalization approach

Trustee

2,450
2,420

Scheduled expiration date ofNovember 30, 2016
trust term
ＰＭ Company

Gross income

182

SBA Management Co., Ltd
Tozai Asset Management Co., Ltd (1,Master Lease Company

Rental income
2F)

175

[Exibit] Summary of Scheduled Acquisition Property(3) Lexington Plaza Hiroshima Otemachi (Comfort Hotel Hiroshima Otemachi)
Category : HotelNo. O-9
Property Name : Lexington Plaza Hiroshima Otemachi
Type of Contract

Long-term contract, Block rental

Main tenant

Greens Co., Ltd

Other income

Lease Details （Unit：¥,000）
Investigation dateNovember end , 2006 (Scheduled)7

Total expenses

30

NOI

157

NCF

152

Capitalization rate

6.3 ％Price calculated by the
Total number of Tenant

2

2,460
Discounted Cash Flow Approach

Leasable floor area

6,395.5 ㎡

Discount rate

6.3%

Floor area

6,395.5 ㎡

Terminal Cap Rate

6.8％

Monthly rent

14,579Deposit/Security deposit

Cost approach price

2,110Land Price

650

Bldg Price

1,460

69,461

Occupancy rate（based on
＿ ％
area）

Scheduled acquisition price (Unit: ¥ million)

2,450

Notes
(*)

1st and 2nd floor are leased to Tozai Asset Management Co., Ltd. under the Fixed Rent Master Lease Agreement. Hotel floors are leased to Greens Co.,

Ltd. under the Lease Agreement, the contract period of which is fixed (20 years).
st

Amount of deposit described above is the deposit amount concerning hotelndfloors. Amount of deposit concerning 1 and 2 floor is omitted because it is same as the amount paid by end tenants.

(＊1) the Investment Corporation makes no warranties as to accuracy or completeness of the description in the column “Summaryof Engineering Report and “Summary of Real Estate Appraisal Report.”

<Feature of Area> Lexington Plaza Hiroshima-Otemachi
The description below is extract or summary from the appraisal report by Industrial Marketing
Consultants Co., Ltd and Tanizawa Sogo Appraisal Co., Ltd.
Feature of Location ・Area
The property has a good accessibility because it is 100m away from “Nakaden-mae” station(Hiroshima-dentetsu), 860m away from Kamiya-machi, and 930m away from Bus Center. It is also conveniently
located in the governmental office area having Hiroshima City Council, Hiroshima Naka-ku Council and Hiroshima
Chuo Post Office.

Therefore, the high operating ratio is expected as a business hotel.

Market Overview
Hiroshima-city is the biggest commercial city in Chugoku/Shikoku area. The number of tourist tends to increaseand hits the highest record which was 3.3 million people in 2005.

Due to the recovery of corporate performance,

there is a steady demand regarding the business hotel. The hotel operating ratio is 73.1 % in Hiroshima city.
Especially, concerning the hotel located in the city center, it is understood that the operating ratio in most hotels is
more than 80%.

(*) The aforementioned column of “Outline of Trade Area”, “Facilities Features”and “Date etc” is extracted orsummarized from the appraisal report by Industrial Marketing Consultants Co., Ltd and Tanizawa Sogo Appraisal Co.,
Ltd. Therefore, with respect to the said each property’s appraisal, the Investment Corporation makes no warranties as
to its accuracy or completeness.

【Appendix １】Photograph and Location Map of the Scheduled Acquisition Property（1）Lexington Square Fushimi（Residential Property）（2）Bon Sejour Musashi-Shinjo（Senior Housing）（3）Lexington Plaza Hiroshima Otemachi（Comfort Hotel Hiroshima Otemachi）

【Appendix 2 】Portfolio after Acquisition of the Property（Scheduled）
Category of

Number of

Properties

Properties

Property Name

Investment（Scheduled）

Acquisition

Acquisition Date

Price

Ratio

Area
（million yen）

（％）

R-1

City House Tokyo Shinbashi

Greater Tokyo

May 25,2006

2,790

5.4%

R-2

Pure City Roppongi

Greater Tokyo

May 23,2006

525

1.0%

R-3

Winbell Kagurazaka

Greater Tokyo

May 23,2006

3,690

7.1%

R-4

Nishiwaseda Crescent Mansion

Greater Tokyo

May 23,2006

2,190

4.2%

R-5

Lexington Square Akebonobashi

Greater Tokyo

May 25,2006

1,600

3.1%

R-6

Montserrat Yotsuya

Greater Tokyo

May 23,2006

557

1.1%

R-7

Casa Eremitaggio

Greater Tokyo

May 25,2006

1,240

2.4%

R-8

Homest East Hills

Greater Tokyo

May 23,2006

521

1.0%

R-9

Lexington Square Shimokitazawa

Greater Tokyo

May 25,2006

2,700

5.2%

R-10

Homest Ikejiri

Greater Tokyo

May 23,2006

806

1.6%

R-11

Towa City Cope Shin-Otsuka

Greater Tokyo

May 25,2006

937

1.8%

R-12

Towa City Cope Asukayama-Koen

Greater Tokyo

May 25,2006

529

1.0%

R-13

Bichsel Musashiseki

Greater Tokyo

May 23,2006

703

1.4%

R-14

Lexel Mansion Ueno Matsugaya

Greater Tokyo

May 23,2006

1,130

2.2%

R-15

Cosmo Nishiojima Grand Stage

Greater Tokyo

May 25,2006

909

1.8%

R-16

Towa City Cope Sengencho

Greater Tokyo

May 25,2006

1,240

2.4%

R-17

Royal Park Ohmachi

TohokuMay 25,2006

564

1.1%

R-18

Lexington Square Hagino-machi

TohokuMay 23,2006

411

0.8%

R-19

Visconti Kakuozan

Chubu

May 23,2006

397

0.8%

R-20

Lexington Square Kitahiroe

Kansai

May 25,2006

596

1.2%

R-21

Lexington Square Shinmachi

Kansai

May 25,2006

421

0.8%

R-22

Luna Coat Tsukamoto

Kansai

May 23,2006

632

1.2%

R-23

Lexington Square Fushimi

Chubu

Oct 31,2006

2,990

5.8%

28,078

54.4%

Residential

Sub-total

Senior

S-1

Bon Sejour Chitose Funabashi

Greater Tokyo

May 25,2006

791

1.5%

S-2

Bon Sejour Yotsugi

Greater Tokyo

May 25,2006

765

1.5%

S-3

Bon Sejour Hino

Greater Tokyo

May 25,2006

699

1.4%

S-4

Bon Sejour Musashi Shinjo

Greater Tokyo

Nov 30,2006

610

1.2%

2,865

5.6%

2,540

4.9%

Sub-total
OfficeO-1

Otsuka Cent Core Bldg

Greater Tokyo

May 25,2006

Others

OfficeO-2

Ueno Fujita Estate 1

Greater Tokyo

May 23,2006

1,840

3.6%

OfficeO-3

Cross Square NAKANOGreater Tokyo

May 23,2006

1,038

2.0%

RetailO-4

Lexington Plaza Hachiman

TohokuMay 23,2006

4,760

9.2%

OfficeO-5

Ohki Aoba Bldg

TohokuMay 25,2006

847

1.6%

RetailO-6

Loc Town Sukagawa

TohokuMay 23,2006

2,563

5.0%

OfficeO-7

Lexington Plaza Sakae-minami

Chubu

May 25,2006

2,400

4.7%

RetailO-8

Valor Takinomizu

Chubu

May 23,2006

2,230

4.3%

Hotel

O-9

Nov 30,2006

2,450

4.7%

20,66840.0%

51,611100.0%

Lexington Plaza Hiroshima

Chugoku・Otemachi

Shikoku
Sub-total
Total(*1) “Area”is divided into five sub-areas which consists of prefectures shown below:
Tohoku area : Aomori, Miyagi, Akita, Iwate, Yamagata, Fukushima
Greater Tokyo area : Tokyo, Kanagawa, Saitama, Chiba
Chubu area : Shizuoka, Nagano, Aichi, Niigata, Fukui, Ishikawa, Toyama, Mie, Gifu
Kansai area : Kyoto, Osaka, Hyogo, Shiga, Nara, Wakayama
Chugoku/Shikoku area : Hiroshima, Okayama, Yamaguchi, Tottori, Shimane, Ehime, Kagawa, Kochi, Tokushima(*2)

In the column of “(Scheduled) Acquisition Price”, the sales price provided in Transfer Agreement with precedent condition isshown. (excluding consumption tax, etc), and rounded off to the nearest million yen.

(*3)

In the column of “Investment Ratio”, each ratio equals each( scheduled )acquisition price divided by grand total (scheduled)acquisition price and is rounded off to the nearest tenth.

【Appendix 3 】

Precondition for Forecast of Performance for the Period Ending August 2007
Item

Precondition
・ The Investment Corporation is assuming that there will be no changes (acquisitions of anew property, sales of acquired property, etc.) in the portfolio until August 31, 2007
(end of the third period) with respect to 33 properties currently owned as of October 27,

Assets under2006 (hereinafter “ Acquired Property”) other than acquisitions of Lexington Square

management

Fushimi (scheduled to acquire on October 31, 2006), Bon Sejour Fushimi and
Lexington Plaza Hiroshima Otemachi (these two properties are scheduled to beacquired by November 30, 2006) (hereinafter “Scheduled Acquisition Property”). In
practice, however, forecasts for investment performance are subject to revision due tochanges in the assets under management.
・ Income from the leases of the properties is calculated based on the lease contracts
related to the Acquired Property and Scheduled Acquisition Property which are
effective as of October 27, 2006, while taking into consideration factors such as

Operating
Revenuecompetitiveness of properties and market conditions.
・ Rent level is calculated taking into consideration factors such as real estate market
conditions and competitive properties located in adjoining areas.
・ Operating revenues are estimated on the basis there are no rental income arrears andnonpayment.
・ Among the expenses for the properties leasing, which are the principal operating
expenses, those other than depreciation and asset management fees are calculated basedon (i) the historical data in the documents as of October 27, 2006 as to the used

Operatingproperties among Scheduled Acquisition Property and Acquired Property, and (ii)

expenses

profit/loss forecasts described in the appraisal report as to newly-built properties among
Scheduled Acquisition Property, while taking variable expenses into consideration.
・ Although property tax and city planning tax are generally settled at the time property is
acquired in the trading of real estate on a pro-rata basis with the former owner inaccordance with the length of ownership period, the Investment Corporation includes
the amount corresponding to the settlement in the acquisition costs.
・ The amount estimated to be required for building repair expenses for each businessperiod is included. However repair expenses could differ significantly from estimatedamounts due to various reasons.

Repair expenses may arise from damage caused by

unexpected factors and the amounts generally tend to differ from year to year, anddifficult to forecast.
・ Depreciation expenses are expected about 364 million yen and calculated using thestraight line method, including ancillary expenses and additional future capitalexpenditure.
Non-operating

・ Interest expenses etc totaling about 205 million yen are expected

Expenses・ The Investment Corporation intends to obtain loans of approximately ¥3,240 million
until October 31, 2006 and ¥3,250 million yen until November 30, 2006 from theBorrowing

qualified institutional investors defined in article 2.3-1 of the Securities and Exchange
Law of Japan.

・ The Investment Corporation holds ¥22,700 million yen of loan outstanding as of
October 27, 2006 and assumes that there will be no changes in debt amount and theinterest rates up to and including the end of the third fiscal period ending August 2007.
Issue of・ It is assumed that no additional investment units will be issued until the end of the fiscal
period ending August, 2007 and that the number of outstanding investment units will

Investment unit

be 59,300 units ( which is the number of outstanding investment units as of October27, 2006) until the end of the fiscal period ending August, 2007.
Dividend

・ Cash distributions per unit are calculated according to the Investment Corporation’s

per unit

distribution policy outlined in its Articles of Incorporation.

・ Cash distributions per unit may vary due to various factors, including the changes inrent income caused by the tenant replacements and unplanned repairs.
Excess profit
Distribution

・The Investment Corporation does not currently plan any distributions in excess of net
income per unit.

per unit
・ The Investment Corporation assumes that there will be no amendments in legislation,
taxation, Japanese GAAP, listing requirements and Investment Trusts Association
Othersregulations, which affect the above forecasts.
・ The Investment Corporation assumes that there will be no material changes in general
economic conditions and real estate markets.