May 18, 2018
Real Estate Investment Trust Securities Issuer
Sekisui House Reit, Inc.
Representative:
Junichi Inoue, Executive Director(Securities Code: 3309)
Asset Management Company:
Sekisui House Asset Management, Ltd.
Representative:
Junichi Inoue,
President & Representative Director
Inquiries:
Yoshiya Sasaki, Chief Manager
Investor Relations Department
TEL: +81-3-6447-4870 (main)

Notice Concerning Handling of Fractional Investment Units Resulting from the Merger
In connection with the absorption-type merger between Sekisui House Reit Investment Corporation(“SHR”) and Sekisui House Residential Investment Corporation (“SHI”) which came into effect on May 1,2018, (the “Investment Corporation Merger”), the unitholders stated or recorded in the final unitholders
register of SHI as of April 30, 2018, (the “Unitholders Subject to Allocation”) were allotted investment unitsof SHR. As a result, some Unitholders Subject to Allocation are now entitled to receive fractional investment
units of less than one unit (the “Fractional investment units”) according to the number of investment units
allotted.
Pursuant to the provisions of Article 88 of the Act on Investment Trusts and Investment Corprorations (ActNo. 198 of 1951, as amended), SHR plans to dispose of such Fractional investment units through market
transactions and distribute the proceeds thereof (the “Sales proceeds of the Fractional investment units”) tothe Unitholders Subject to Allocation entitled to receive the Fractional investment units in proportion totheir total number of fractional investment units.
SHR will notify the Unitholders Subject to Allocation concerned of information on the relevant amounts tobe distributed, the distribution method and other related matters of Sales proceeds of the Fractional
investment units by mail, and plans to commence payment of the proceeds by around the latter half of July
2018.
1.

Allotment of investment units

Unitholders Subject to Allocation (that is, the unitholders who held investment units of SHI on April 24, 2018,the last date of cum-rights trading), are entitled to receive allotment of investment units of SHR.
Allocation of investment units underInvestment Corporation Merger

SHRSHI1

1.65(Note) The number of new SHR investment units issued as a result of the Investment Corporation Merger is 1,824,091
units.

Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.

2.

Calculation method of allotted investment units
Formula: Number of SHI investment units held × 1.65 = Number of SHR investment units allotted(1) An Unitholder Subject to Allocation who held one SHI investment unit as of the record date
The number of SHR investment units allotted following the Investment Corporation Merger to theUnitholder Subject to Allocation is 1.65 units.
(Reference diagram)
SHI

SHR

1 unit1 unit0.65 units: Fractional investment units

Sales proceeds equivalent to 0.65 units, which are less than one investment unit, will be
paid to the Unitholder Subject to Allocation(2) An Unitholder Subject to Allocation who held five SHI investment units as of the record date
The number of SHR investment units allotted following the Investment Corporation Merger to theUnitholder Subject to Allocation is 8.25 units.
(Reference diagram)SHI

5 units

SHR
8 units

0.25 units: Fractional investment units

Sales proceeds equivalent to 0.25 units, which are less than one investment unit, will be
paid to the Unitholder Subject to Allocation(3) An Unitholder Subject to Allocation who held 20 SHI investment units as of the record date
The number of SHR investment units allotted following the Investment Corporation Merger to theUnitholder Subject to Allocation is 33 units.
(Reference diagram)

SHI

SHR

SHR

SHISHRSHR

20 units

33 units

As there are no Fractional investment units, no cash payment equivalent to sales
proceeds of fractional units will be made.
Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.

(4) An Unitholder Subject to Allocation who held SHI investment units in accounts at multiple securities
companies
If a unitholder held SHI investment units in accounts at multiple securities companies as of the record
date, the Fractional investment units will be processed based on name-based aggregation andcalculation of the total number of units. If the number of units held by a unitholder, which is calculatedby adding up the Fractional investment units in each account at the respective securities companies, isone unit or more, the integral number of the units will be recorded in the securities company accountholding the largest number of units of SHI and the Fractional investment units through suchaggregation process will be treated as shown above.
(Reference diagram)(Example) An Unitholder Subject to Allocation who held two SHI investment units in an account atSecurities Company A and six of the same investment units at Securities Company B as ofthe record date
Account at
Securities
Company A

Account at
Securities
Company B

SHI
2 unitsSHR

2 units

3 units

SHISHR

6 units

9 units

0.3 units

0.2 units:
Fractional investment units
SHR

0.9 units

1 unit: to be recorded in theaccount at Securities
Company B

The total number of Fractional investment units in each account at the respectivesecurities companies is 1.2 units. Of the units, one unit will be recorded in the securities
company account holding the largest number of SHI investment units (in the above case,the account at Securities Company B). In addition, with respect to the remaining
fractional 0.2 units following the aggregation, which are less than one unit, the unitholder
will be paid an amount equivalent to the sales proceeds of the Fractional investment
units.
3.

Schedule (planned)
June 15, 2018
Dispatch of notice letters of allotted number of investment units (Note 1)
the latter half of July 2018 Commencement of payments of merger consideration (Note 2) and Sales
proceeds of the Fractional investment units(Note 1) Letters will be dispatched to the Unitholders Subject to Allocation.
(Note 2) As the proceeds of cash distributions for SHI’s final fiscal period (October 1, 2017, to April 30, 2018),
SHR plans to make payment of delivered money due to the Investment Corporation Merger
equivalent to the cash distribution for the final fiscal period to the Unitholders Subject to Allocationor the registered pledgees of investment units held. Please refer to the “Notice Concerning Forecastof Operating Results for the Fiscal Period Ending April 30, 2018, (Final Fiscal period) and Merger
Consideration” dated January 24, 2018, prepared by SHI as a forecast of the merger consideration
due to the Investment Corporation Merger by SHI. The merger consideration is undeterminedcurrently and will be notified as soon as it is finalized.
*Sekisui House Reit, Inc. website: http://sekisuihouse-reit.co.jp/en/

Disclaimer: This translation is for informational purposes only. If there is any discrepancy between the Japanese version and the English translation, the Japanese version shall prevail.

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