Thank you very much for taking time for our presentation.
I’m Hikaru Teramoto, President & CEO of Kenedix Real Estate Fund Management, Inc.
I’m Hiroaki Momoi, Head of Office REIT Department.
I’m Tetsu Kawashima, Head of Residential REIT Department.
I’m Moyuru Watanabe, Head of Retail REIT Department.
We would like to express our deepest gratitude for your continued support to Kenedix Office
Investment Corporation, Kenedix Residential Next Investment Corporation, and Kenedix
Retail REIT Corporation, all of which we are entrusted with the management.
From now, I would like to explain the overview and rationale of the Merger of these threeREITs as announced on June 13.
Please note that we call Kenedix Office Investment Corporation as KDO, Kenedix Residential
Next Investment Corporation as KDR, and Kenedix Retail REIT Corporation as KRR,
respectively.
Let us start the presentation.
Please turn to page 5 of the presentation material.

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So far, each of the 3 REITs have focused on different asset types: KDO on mid-sized officebuildings, KDR on residential properties and healthcare facilities, and KRR on shopping
centers for daily needs. Each of the 3 REITs have continued to grow its AUM backed by thehigh recognition from the market for its unique management styles and sustainable growthperformance. However, all of these three REITs are now facing challenges of how to ensuresustainable growth potential, amid the circumstances of difficulty in property acquisitions,investment unit prices trading below NAV for some time, and concerns of decline in theportfolio profitability that may be caused by rising interest rates and inflation.
Under these circumstances, we have decided to merge the 3 REITs for the purpose ofpursuing new growth opportunities, while succeeding our unchanging asset management
philosophy. As a result of the Merger, the New REIT will emerge as a REIT of greater
presence with AUM of 1,149 billion yen, exceeding 1 trillion yen, as well as the mostdiversified portfolio in the J-REIT sector consisted of 350 properties of different asset types.
The New REIT will expand the investment universe and is expected to be distinguished andreturn to a sustainable growth trajectory, with its structure that will enable flexibility with every
possible environmental change.
Please turn to page 6.

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First, let me address the scheme and schedule of the Merger.
The name of the New REIT will be “KDX Realty Investment Corporation.”
This is an absorption-type merger and KDO will be the surviving REIT, while KDR and KRR
will be the dissolving REITs. We judged that KDO being the surviving REIT is most effective inexecuting growth strategy that will contribute to maximize unitholder value because of its
largest unrealized gain among the 3 REITs.
With regard to the merger ratio, 0.67 investment units of KDR and 0.84 investment units ofKRR will be allocated per one unit of KDO. In order to avoid allocation of KDO units less than
one unit to a large number of unitholders of both dissolving REITs, a 2-to-1 split of KDO units
will be implemented with an effective date of November 1, 2023. Accordingly, 1.34 units and1.68 units of KDO will be allocated to KDR unitholders and KRR unitholders, respectively.
The scheduled events of the Merger will include the record date for meetings of unitholders on
June 30, followed by General Meetings of Unitholders of KDR and KRR on August 21, and of
KDO on August 22. If the Merger is approved at each of these General Meetings ofUnitholders, KDR and KRR will be delisted on October 30, and the merged New REIT willtake off upon the name change from KDO on November 1.
Please turn to page 9.

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The current environment undergoes unprecedented and significant changes which J-REITs
have never experienced, such as changes in social structure caused by the COVID-19
pandemic, and growing concerns over global inflation and shifts in fiscal policies attributableto geopolitical risks.
Under these circumstances, we would like to point out three points as rationale of the Merger:(i) Sustainable growth driven by expansion of investment universe, (ii) Improvement in market
presence and stability, and (iii) Further commitment to sustainability.
I will go into details from next page on.
Please turn to page 10.

9Let me start by the explanation with the “Expansion of Investment Universe.”
The Merger will help us expand the investment universe. While continuing to focus on midsized office buildings, residential properties and healthcare facilities, and shopping centers fordaily needs, the New REIT will be able to access more extensive opportunities for acquisitionof logistics facilities and hotels, which the 3 REITs have had limited exposure.
In addition, the New REIT may reshuffle the portfolio to dispose of relatively weakened
properties with declining competitiveness and profitability. Asset reshuffling among different
asset types, for example, replacement of a mid-sized office building with a hotel that is
expected to continuously increase demand, will be an option to enhance profitability of theportfolio and achieve sustainable growth beyond what could be achieved through the current
specialized strategy.
Please turn to page 11.

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It is expected that AUM of the New REIT will be the third largest among all J-REITs, standing
at 1,149.8 billion yen, which will enhance the market presence significantly. As there will be apossibility of being included in the MSCI World Standard Index, one of the benchmarks
preferred by institutional investors with a global portfolio, liquidity of investment units will beenhanced.
The integrated portfolio will contain 350 properties, the largest number of properties among allJ-REITs, leading to the portfolio diversification that will further stabilize earnings.
We are determined to continue progressing toward growth even after the Merger. Our AUM
target is 1.5 trillion yen, and we would like to achieve the target while maintaining discipline on
the level of NOI yields and stable profits.
Our next topic will be “Further Commitment to Sustainability”. Please turn to page 12.

11Based on the recognition of the importance of sustainability, all of the 3 REITs have actively
taken initiatives to promote sustainability on a continuing basis.
For instance, KDO have made advanced efforts and was the first J-REIT to participate in
GRESB Real Estate Assessment, which is now common to almost all major REITs.
The New REIT will integrate and elevate expertise of the 3 REITs, which have engaged inmanagement of properties in different asset types, in order to be a leading company in thesector.
Please turn to page 13.

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The New REIT will introduce a new asset management fee structure linked to unitholders’interest and sustainability indicators. It will also reinforce the board structure with more
supervisory directors to strengthen governance and more female ratio to promote diversity,
solidifying further commitment to sustainability efforts.
The presenter now changes to Head of Office REIT Department Mr. Momoi, who concurrently
serves as the Executive Director of the surviving REIT. He will explain the post-merger
growth strategy and earnings forecast.
Please turn to page 15.

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The four investment highlights for the New REIT’s growth strategy are indicated on this page.
First is to expand the investment universe to acquire new growth opportunities.
While the 3 REITs have put focus on specific asset types, the New REIT will expand growth
opportunities in asset types with greater growth potential, such as logistics facilities and hotels,
which have not been primarily targeted by the 3 REITs.
Second is to enhance profitability through constant asset reshuffling adapting toenvironmental changes.
For example, some of our properties that face or may face decline in the profitability may bereplaced by assets with growth potential. This asset reshuffling will help the New REIT topursue both stability in earnings and growth amid the environmental changes and maximize
unitholders’ value, through realization of unrealized gains and improvement of portfolio quality.
Third is to implement active management to acquire upside revenues.
The 3 REITs have actively made efforts to enhance profitability of each of the owned
properties through conversion, use of underutilized space and renovation, within theframework of the current specialized strategies. The New REIT can enjoy enhanced risk
tolerance on the back of economies of scale and diversification of the portfolio, while
succeeding know-how of active management, which will facilitate acquisition of lowoccupancy or unoccupied properties on the premise of leasing up and will enablemaximization of earnings from internal growth and further expansion of external growth
opportunities.
Fourth and the last is to secure financial flexibility and enhance risk resilience. The LTV of theNew REIT will be lowered from those of the 3 REITs on a pre-merger basis. This means that
greater borrowing capacity will enable the New REIT to secure more capacity for acquisitions.
The New REIT will retain the policy of controlling LTV properly according to environmentalchanges, which will both drive its external growth and help it secure a stable financial base.
Please turn to page 16.

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The asset management policies for the assets we have put focus on, such as mid-sized officebuildings, residential properties and healthcare facilities, and shopping centers for daily needs,
will remain unchanged. On top of that, the New REIT will seek new growth opportunities
through enhanced investments in assets such as logistics facilities and hotels that are capable
to address changes in the social environment.
The New REIT will not set targets of ratios by asset types, as it aims to ensure the flexibility toaddress changes.
It will neither set specific targets of ratios by area, because optimal locations vary by sector.
The New REIT intends to make investments, leveraging expertise cultivated by the 3 REITs,
in optimal areas by asset types.
Please turn to page 17.

16In association with the Merger, an asset reshuffling will be implemented. We will dispose of
two properties, an aged single-tenanted office building with future risks of tenant vacate, andanother office building suffering from low NOI yield after depreciation and unrealized loss.
These assets will be disposed of at prices that will generate gain on sales. Meanwhile, weannounced the acquisition of logistics facility and hotel, asset types to be newly focused after
the Merger, as well as residential property in which renovation is planned to enhance
profitability, and shopping center for daily needs that will bring stable revenues.
This asset reshuffling reflects what are expected from the Merger as synergies: expansion of
the investment universe to acquire new growth opportunities, enhancement of profitability
through constant asset reshuffling, and implementation of active management to acquire
upside revenues. The New REIT intends to achieve growth through a series of these kinds ofefforts.
Please turn to page 18.

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On this page, I would like to introduce a part of our pipeline, indicating properties that we arelikely to acquire.
Our robust pipeline consists of 21 properties in various asset types, with aggregate value ofmore than 80 billion yen. Our plan is to ensure acquisition of these properties, leveragingequity financing monitoring the investment unit price, debt financing supported by the postmerger borrowing capacity, and proceeds from disposed properties, to make the portfolio
grow and elevate the level of profits on a stabilized basis.
Please turn to page 19.

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LTV of the New REIT will be 43.5%, significantly lowering from the pre-merger levels of the 3REITs, as the portfolio of the New REIT will accept assets of KDR and KRR at market value.
The borrowing capacity will be expanded to about 150 billion yen if LTV is raised to 50%.
In viewing the correlation between AUM and credit ratings, there may be potential upgrade of
the credit rating after the Merger. We will stay focused on LTV control according toenvironmental changes and financial stability, with an aim to credit rating upgrade.
Let’s move on to page 21 for our next topic, financial highlights.

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The New REIT will retain a strategy of solid financial management based on the solid relations
with the lenders, by maintaining the standard of the fixed interest rate debt ratio and staggeredmaturities of interest-bearing debt.
In addition, the New REIT will reduce the borrowing cost for refinancing, which can beconsidered as one of the synergy effects of the Merger, by lowering borrowing costs of KDRand KRR, which is higher than that of KDO, to the level of KDO.
Please see page 23 for earnings forecast of the New REIT.

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The earnings for the fiscal period ending April 2024, the first fiscal period post-merger, areforecasted as indicated in the table.
DPU for the fiscal period is forecasted at 3,800 yen upon reversal of internal reserves of 1.8billion yen, considering temporary increase in expenses attributable to the Merger.
Please see page 24.

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The comparison between the actual DPU of the 3 REITs prior to the Merger and forecasted
DPU by the New REIT for the fiscal period ending April 2024 is shown in the graph. The
forecast reflects the differences in pre-merger yields expected for each of the 3 REITs, theMerger ratio determined after negotiations, and various temporary factors related to theMerger.
For the fiscal period ending October 2024 and thereafter, when the temporary factors relatedto the Merger will be resolved, the New REIT will aim to increase DPU through active asset
reshuffling among different asset types, accelerated external growth driven by borrowing
capacity, maximization of revenues from internal growth by active management, and reduction
in borrowing costs for refinancing, as well as utilization of internal reserves and gain on sales
associated with the asset reshuffling. The New REIT will target stabilized DPU level of 4,000
yen while maintaining and increasing from the previous DPU levels of the 3 REITs.
This concludes our presentation about the Merger.
As mentioned at the beginning of this presentation, we will not only face difficulty in strategic
outlining for growth, but rather face risks that our business may be scaled back or movebackward if we aimlessly continue asset management in the same manner as before under
the changing circumstances with greater uncertainties.
This Merger helps us build a more solid portfolio with capabilities of the 3 REITs integrated
and be ready for a turnaround. Our decision on the Merger of the 3 REITs was driven by ouraim to put the New REIT, an emergence of which can be considered as our second birth, on
track for growth, by taking advantage of various opportunities arising out of uncertainties.
We sincerely ask every unitholder of the 3 REITs to give understanding of and approval to theMerger.

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