Make The World
More Sustainable[Provisional Translation Only]
This English translation of the original Japanese document is provided solely for information purposes.
Should there be any discrepancies between this translation and the Japanese original, the latter shall prevail.

March 17, 2021
IssuerIchigo Hotel REIT Investment Corporation (“Ichigo Hotel,” 3463)
1-1-1 Uchisaiwaicho, Chiyoda-ku, Tokyo
Representative: Osamu Miyashita, Executive Director
www.ichigo-hotel.co.jp/en
Asset Management Company
Ichigo Investment Advisors Co., Ltd.
Representative: Hiroshi Iwai, President
Inquiries: Hidehito Iwasaka, Head of Ichigo Hotel
Tel: +81-3-3502-4892

Earnings Forecast Revision for the July 2021 Fiscal Period
Ichigo Hotel is revising down its July 2021 fiscal period earnings forecast announced
in the September 14, 2020 release “July 2020 Fiscal Period Earnings.”
1. July 2021 Earnings Forecast Revision

Previous Forecast(A)
New Forecast(B)
Difference(B) - (A)% Change
Reference:
July 2020 Actual(JPY million)
Net
IncomeDividendper Share(JPY)

Operating
Revenue

Operating
ProfitRecurring
Profit

1,041423

225

224

881

1,037376

173

172

678-4-47-52-52-203-0.4%-11.0%-22.9%-23.0%-23.0%

953

371

171

170670

Reference: Net Income per Share: JPY 678
Period-end number of shares outstanding: 254,974 shares
Note: The new forecast is based on the “Preconditions for the July 2021 Earnings
Forecast” on page 3. Actual results may vary due to changes in circumstances, so these
forecasts should not be construed as a guarantee of such results. Ichigo Hotel will make aforecast revision should a material discrepancy emerge between this forecast and results.

12. July 2021 Earnings Forecast Revision Rationale
The second state of emergency declared by the Japanese government in January 2021 andfurther extended in March for Tokyo and neighboring prefectures has resulted in anothersharp decrease in hotel demand.
Although hotel demand is expected to gradually recover on the back of the Covid vaccine
rollout which began last month, the recovery is expected to take time.
Given these circumstances, Ichigo Hotel is revising down its July 2021 fiscal period(February 1, 2021 – July 31, 2021) earnings forecast announced on September 14, 2020,
having reviewed its outlook for variable rent and taking into account potential requests
from hotel operators for exemptions and/or deferrals of fixed rent payment.
As a result, the forecast for July 2021 operating revenue, operating profit, net income,and dividend per share are each expected to decrease by JPY 4 million (-0.4%), JPY 47
million (-11.0%), JPY 52 million (-23.0%), and JPY 203 (-23.0%), respectively, versus
the previous forecast.
Should any further change to the outlook for operating results arise, Ichigo Hotel willpromptly disclose the details.

2Preconditions for the July 2021 Earnings Forecast
Preconditions
PeriodNumber ofHotels

 February 1, 2021 to July 31, 2021 (181 days)
 23 hotels
 The Grandpark-Inn Yokohama had an operator change on February 1,
2021 and rebranded and reopened as the Capsule Plus Yokohama on
March 1, 2021.
 The Chisun Inn Osaka Honmachi had an operator change on March 17,2021 and is scheduled for rebranding and reopening as The OneFive
Osaka Sakaisuji on July 1, 2021.
Within operating revenue, rental income is forecast based on current lease
contracts, taking into consideration such factors as hotel and market
conditions.1
Forecast Operating Performance2

3

Occupancy
ADR4

July 2021 Fiscal Period
57.8%
JPY 4,737

1OperatingRevenue

The forecast rental income assumes operators and tenants will fully pay
their contractual rents without delay or default.
2
The 16 variable rent hotels are: Smile Hotel Kyoto Shijo, Nest Hotel
Sapporo Ekimae, Chisun Inn Osaka Honmachi, Nest Hotel Sapporo
Odori, The OneFive Fukuoka Tenjin, Nest Hotel Osaka Shinsaibashi,
Smile Hotel Tokyo Asagaya, Nest Hotel Matsuyama, Court HotelKurashiki, Hotel Wing International Nagoya, Hotel Wing International
Kobe Shin Nagata Ekimae, Nest Hotel Kumamoto, Valie Hotel
Hiroshima, HOTEL EMIT SHIBUYA, The OneFive Okayama, andCapsule Plus Yokohama.
3
Occupancy is calculated with the following formula:
Occupancy = Total number of guest rooms occupied during the period /(total number of guest rooms * number of days hotel was in operation
during the period)
4
ADR or Average Daily Rate is calculated with the following formula:
ADR = Total sales from accommodation (excluding restaurant charges
and other service fees) / number of guest rooms occupied during theperiod
Details of the July 2021 Rental Income Forecast by Hotel(JPY million)
Fixed Rent/Minimum Variable
Guaranteed Rent
Rent

Hotel Name
Smile Hotel Kyoto Shijo
Nest Hotel Sapporo Ekimae

330
31––Total
3031

Chisun Inn Osaka Hommachi
Comfort Hotel Hamamatsu
Nest Hotel Sapporo Odori
Valie Hotel Tenjin
Nest Hotel Osaka Shinsaibashi
Comfort Hotel Central International
Airport
Smile Hotel Tokyo Asagaya
Nest Hotel Matsuyama
Comfort Hotel Okayama
Comfort Hotel Kushiro
Comfort Hotel Suzuka
Court Hotel Kurashiki
Nest Hotel Kumamoto
Valie Hotel Hiroshima
HOTEL EMIT SHIBUYAOther1Total
1255
27
1466

–––––

255
271466

151

–

151

61
36
61
18
15
31
25
17
47
252
947

–
14––––
818
–
346

61
50
61
18
15
31
34
36
47
256
993

Figures for Hotel Wing International Nagoya, Hotel Wing InternationalKobe Shin Nagata Ekimae, Hotel Livemax Nihombashi-Hakozaki,
Capsule Plus Yokohama, Urbain Hiroshima Executive, andWashington Hotel Plaza Shimonoseki Eki Nishi are included in“Other” because the hotel operators did not provide consent to disclose
hotel-specific data.

Retail: JPY 29 million of rental income from retail tenants at Chisun Inn
Osaka Hommachi, Hotel Wing International Kobe Shin Nagata Ekimae,and Smile Hotel Tokyo Asagaya, and from banquet rooms at Nest Hotel
Kumamoto

OperatingExpenses

 Depreciation: JPY 346 million. Depreciation has been calculated using
the straight-line method.
• Property and city planning taxes: JPY 118 million• Building maintenance and repair expenses are based on what Ichigo
Investment Advisors, the asset management company of Ichigo Hotel,
estimates will be necessary for each hotel during the period. However,actual expenses for the period could differ significantly from these
forecast amounts for reasons including the variability of maintenanceand repair expenses, one-time costs due to unexpected building damage,etc.
 Other expenses: JPY 37.8 million for Covid-related hotel operator
support and/or rent reductions.
 SG&A expenses: JPY 3.1 million for engineering report costs and JPY
1.8 million for environmental certification costs.

4

NonOperatingExpenses

 Interest expenses and other borrowing-related expenses: JPY 202millionBorrowings

 Total borrowings: JPY 25.97 billion as of July 31, 2021

Number ofShares 254,974 shares issued and outstanding as of today. The forecast assumes
there will be no additional new issuance of shares through July 31,2021.

Dividend The dividend forecast assumes that dividends will comply with thedividend distribution policy stipulated in Ichigo Hotel’s Articles ofIncorporation.
 The dividend is subject to change due to factors such as sales of
portfolio assets, changes in rental income associated with operator
turnover, the occurrence of unexpected maintenance and repair costs,and fluctuations in interest rates.

Dividend in
Excess ofEarnings

 Ichigo Hotel does not plan on paying any Dividend in Excess ofEarnings.

Other This forecast assumes that there are no material revisions to laws andregulations, the tax system, accounting standards, listing rules of theTokyo Stock Exchange, and rules of the Investment Trusts Association,
Japan, and no material changes in the state of the economy and realestate market conditions.
 Given ongoing Covid uncertainty, these earnings forecasts are subject tochange.

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