<For translation purposes only>
August 3, 2007
For Immediate Release
REIT Issuer
Hankyu REIT, Inc. (Securities Code: 8977)
19-19 Chaya-machi, Kita-ku, Osaka
Mineo Yamakawa, Executive Director
Asset Management Company
Hankyu REIT Asset Management, Inc.
Mineo Yamakawa, President & Representative Director
Contact:
Hideo Natsuaki,
General Manager, Investor Relations Dept.
Email: ir@hankyu-rt.jp

Notice Concerning the Acquisition of Asset（Execution of Agreement)

Hankyu REIT, Inc. (hereafter “Hankyu REIT”) hereby notifies that we today decided to execute an agreement for thepurchase of quasi co-ownership of the trust beneficiary interests in the following real estate investment and details aredescribed below.

Details1.

Overview of Acquisition
(i)
(ii)

Acquired asset:

Real estate trust beneficiary interests

Trustee:

Mitsubishi UFJ Trust and Banking Corporation (Note)

Property name:Sphere Tower Tennoz(iii) Proposed acquisition price:

9,405 million yen (excluding acquisition-related expenses, property tax, city
planning tax and consumption tax, among others)(iv)

Proposed acquisition date:

October 2, 2007(v)

Seller:Global One Real Estate Investment Corp.

(vi)

Acquisition funds:

Corporate funds and borrowed funds (TBD)(Note)

2.

This transaction is for the acquisition of a 33% interest with quasi co-ownership of the trust beneficiary interests of
the land and building of this property.

Reason for Acquisition
Based on policies and properties under management as stipulated in our articles of incorporation, in order to obtainsteady growth with a focus on an overall balanced portfolio, we are acquiring a multi-purpose facility outside of theKansai region. Also, with the decision to acquire this property, we have made the following assessments:(i)Location Conditions¾The Tennoz district where the property is located is a comparatively new office area with a concentration ofhigh-rise office towers and hotels centered around Tokyo Monorail Station “Tennoz Isle.”¾

In 2001, transportation access from the area to Chiba prefecture improved with the opening of the TWR (TokyoWaterfront

Area Rapid Transit) Rinkai line, which connects Tennoz Isle station with Shin-Kiba station. Also, in1

2002, the same line was extended to the west to JR Osaki station (Yamanote line), allowing reciprocal extension
with the JR Saikyo line, and with this transportation convenience has greatly improved.

(ii)

Property Characteristics¾

The tower is a large-scale building with a standard floor area of 327 tsubo and a total floor space of about
13,324 tsubo. This floor area combined with its stately facade make it one of the Tennoz area’s symbolic
buildings.

¾

Because it is one of the buildings in the area that directly connects with Tennoz Isle station, it has a comparativeadvantage over other properties in the area. In particular, we believe it will appeal strongly to business tenants
who require access to Haneda Airport (airlines and travel), the Odaiba area (media/television companies), andthe Waterfront area (transport companies).

3.

Details of the Acquired Asset
Property nameSphere Tower Tennoz

Specific asset type

Trust beneficiary interests (quasi co-ownership：33% interest)

Proposed acquisition price

9,405 million yen

Appraised price

9,405 million yen (As of June 30, 2007)(Appraisal organization：Japan Real Estate Institute (Foundation))

Location

Address

2-2-8 Higashi-Shinagawa, Shinagawa-ku, Tokyo

Land

Building

80%

Building

coverage
Floor area ratio(Note 2)500%Month/Year

1) April 1993

Built

2) June 1991

Structure/1) Steel-frame, reinforced

Number ofconcrete, steel-frame

floorsreinforced concrete
structure with deck roofand 2 undergroundlevels, 27 floors
2) Reinforced concrete
structure with deck roof
and four-storey
basement

Zone use

Commercial zoneUse1) Office/store
2) Machine room (local air
conditioning/heatingfacility)

Lot area

6,106.11m

2

Total floorarea(Note 1)

1) 43,477.68m2) 3,674.04m

22(Note 1)

Form ofRight of ownership

Form ofownership
Design company
Construction company
Building recognition
organization
Preparer of building
appraisal documents

Right of ownershipownership
RIA Inc., Kajima Corporation
The consortium composed of Kajima Corporation, Taisei Corporation, Kumagai
Gumi Co., Ltd., Sato Kogyo Co., Ltd. and Mitsubishi Construction Corporation
Tokyo Metropolitan Government
Takenaka Corporation (June 2007)2

Property manager

Xymax Axis Corporation

PML of earthquake risk

2.7% (Evaluator: Engineering & Risk Services Corporation, OYO RMS

analysisCorporation）

CollateralNone
The plan is for Hankyu REIT and Global One Real Estate Investment Corp. to jointlySpecial items

owned 33% and 67% of trust beneficiary interests, respectively, and to execute a“quasi co-owners’ agreement” between the trustees and Global One Real Estate
Investment Corp. (Note 3)

4.

Note 1:

The total area of the building and the land

Note 2:The trustees possess sole beneficiary rights to the offices and shops within the land and building rights, and the local air
conditioning/heating facility is owned jointly by the trustees and the adjacent north-side land owners (trustees 34.44%
membership interests, adjacent north-side land owners, 65.56%). Also, the local air conditioning/heating facility straddles theabove land and the adjacent owner’s land and are located underground.

Note 3:We plan to set forth in the quasi co-owners’ agreement the following items:
・With respect to instructions to trustees (regarding the management of property) or seeking approvals from trustees(hereafter referred to as ”Instructions”) Global One Real Estate Investment Corp. will perform these duties asrepresentative of beneficiaries, and the asset management company Global Alliance Realty Co., Ltd., with Global One
Real Estate Investment Corp. as its agent, will exercise its right to deliver the Instructions.

・Upon delivering Instructions for trust properties to the trustees, they will prioritize their smooth execution of themanagement and administration and based on the consideration of the extent of the economic influence of said
instructions, and in necessary cases make decisions on the nature of those instructions after having completed due
diligence and arrangements among the beneficiaries based on good faith discussions.

・Proceeds to beneficiaries will be distributed and paid to quasi co-owners pro rata.

・There will be collectively no monetary liability based on the trust agreement, and each quasi co-owner will bear pro rata
financial responsibility.

・In order to coordinate the interests of quasi co-owners, we will set up a communications committee for the quasi
co-owners

・In the case that a single quasi co-owner unilaterally disposes of its interest, the remaining quasi co-owners shall have rightof first refusal to acquire those interests over external third parties.

Overview of Leases and Tenancy
Total number of tenants

24 (Note 1)

Annual rent (corresponding to 33% interest)

557 million yen (Note 2)

Rental area capacity (corresponding to 33% interest)

8,665.72 m (Note 3)

Actual rented area (corresponding to 33% interest)

8,470.28 m (Note 3)

Occupancy rate

97.7% (Note 4)

Security deposit (corresponding to 33% interest)

384 million yen (Note 5)22

Note 1: Current number of tenants
Note 2: The figure represents a calculation of monthly rental amounts and revenues from common area charges as expressed on
existing rental agreements multiplied by twelve months and then taking 33% of that number. Figures are rounded to thenearest million yen unit.
Note 3: Rental area capacity is calculated by multiplying 33% by the current total rental capacity, and “actual rented area” is calculated
by multiplying 33% by the actual area of rental space occupied by tenants in existing agreements. Figures are rounded to thenearest hundredth meters squared. Parking garage space, storage and machinery rooms are not included.
Note 4: The current ratio of actual rented space to available space. Figure is rounded to the nearest tenth. Parking garage space,storage and machinery rooms are not included.
Note 5: The figure is a result of calculating the total monetary value of security deposit held from existing agreements by 33%. The
figure is rounded to the nearest million yen unit. Security deposits related to parking garage space, storage and machinery
rooms are not included.

3

5.

Overview of the Seller
Trade name

Global One Real Estate Investment Corp.

Location of headquarters

4-1 Kojimachi, Chiyoda-ku, Tokyo

Representative

Executive Director Yoichiro Kitajima

Capital stock

75,026,315,500 yen (Note 1)

Major investors

NikkoCiti Trust and Banking Corporation (Trust Account), et al. (Note 2)
Investment management of assets in specific assets as set out in Article 2,

Main business activities

Paragraph 1 of the Investment Trust and Investment Corporation Law

Relation to Hankyu REIT or
asset management company

None

Note 1: Current capital stock
Note 2: Major investors as of March 31, 2007

6.

Transactions With Interested Parties, etc.
Not applicable.

7.

Status of the Property Acquirer, etc.
Property nameSphere Tower Tennoz

Status of the property acquirer, etc.

Previous owner・Trust beneficiary rightsholders

Company name; name

Parties other than special interested parties

Parties other than special interested parties
Acquisition background, reasons, etc.
Acquisition price
Acquisition date8.

Overview of Intermediaries
Not applicable.

9.

Acquisition Process
August 3, 2007

Resolution approving execution of the agreement at the asset management company's Boardof Directors' Meeting.
Execution of the quasi co-ownership sale/purchase agreement

October 2, 2007

Planned acquisition of the trust beneficiary interests410. Future Outlook
The acquisition of this property will have minimal influence on the conditions surrounding the management ofHankyu REIT’s assets during the six-month period ending November 30, 2007, therefore we do not forecast
making any revisions for said period.
•The Japanese original document was distributed to press clubs within the Tokyo Stock Exchange (Kabuto Club), Osaka
Securities Exchange, Ministry of Land, Infrastructure and Transport, and to the press club of the construction trade newspaperof the Ministry of Land, Infrastructure and Transport.

•Hankyu REIT website: http://www.hankyu-reit.jp/<Attachments>
・Reference material 1

Overview of Appraisal Report

・Reference material 2

Table of Real Estate Portfolio After the Acquisition of the Property

・Reference material 3

External photograph, information guide5Reference Material 1

Overview of Appraisal Report
PROPERTY NAMESPHERE TOWER TENNOZ

Appraised Value

9,405,000,000 yen

Appraisal Organization

Japan Real Estate Institute (Foundation)

Date of Appraisal

June 30, 2007
Item

Earned Price *Value

Basis for Valuation

28,500,000,000 yen

Earned Price from Direct Capitalization Method

28,900,000,000 yen(i) Gross Return (a + b - c)

2,235,539,000 yen

a Income from rental fees

1,793,698,000 yen

Assessment based on medium- and long-term stablelevel of rental fee and usage fee averagesb Other income

576,000,000 yen

Recorded income from utilities expenses, etc.

c Loss from non-occupancy

134,159,000 yen

Assessed non-occupancy rate: office space (4%),
shops (8%), other (4%) and parking space (60%).

(ii) Total Costs (a + b + c + d + e)

835,938,000 yen

a Maintenance/administrative
fees, etc.

279,853,000 yen

Assessment based on existing contracts and pastactual recordsb Utilities

360,000,000 yen

Assessment based on past actual records

c Public charges and taxes

175,351,000 yen

Assessment based on 2007 tax base amounts

d Casualty insurance premiums

4,234,000 yen

Assessment based on considering the premiums inexisting insurance contracts

e Other expenses

16,500,000 yen

Recorded monorail
administrative costs

overpassmaintenanceand(iii) Net rental income (NOI = (i) - (ii))

1,399,601,000 yen(iv) Gain on investment of lump-summoney

25,917,000 yen

Assessment based on a medium- to long-term stablelump-sum money in view of the occupancy rate(v) Capital expenditures

125,825,000 yen

Assessment considers the average annual costs ofrepair and renovations over twelve years included in anengineering report that was conducted.

(vi) Net cash flow (NCF = (iii) + (iv) - (v))

1,299,693,000 yen(vii) Capitalization rate

Price based on discounted-cash-flow method

4.50%

Based on portfolio property location, type of building,and existing contractual conditions, among otherfactors

28,100,000,000 yen

Discount rate

4.30%

Determined by assessing factors such as capitalization
rate on investments in long-term financial products, riskof targeted real estate for investment purposes, andborrowing rates.

Terminal capitalization rate

4.70%

Based on portfolio property location, type of building,and existing contracts, among other factors

Estimated Price*

26,800,000,000 yen

Land ratio

60.04%

Ratio of the land rounded to the nearest hundredth as apercentage to the value of the building and its lot

Building ratio

39.96%

Ratio of the building rounded to the nearest hundredth
as a percentage to the value of the building and its lot

Special items toconsider at the time ofmaking adjustments toprovisional calculations
and deciding theappraisal price/value

We adopted the earned value having made an assessment using both the DCF method and the direct-return
method, and using the computed value as a reference. We assessed the value of the building and its lot to be
28,500,000,000 yen, and decided that the appraised value of our planned acquisition at 33% to be
9,405,000,000 yen.
*The above earned value and provisional value correspond to the building and its lot.

The appraisal value of real estate is an indication of the opinion of the value by the appraiser of the real estate in question and is conductedby an appraisal in accordance with the law and standards related to real estate appraisals at the time of the appraisal. There may be cases
where an appraisal of the exact real estate is conducted again, and because of factors such as timing of the appraisal and the appraisal
method used by the appraiser, a different value may result. Furthermore, the appraised valuation of real estate is neither a guarantee nor anobligation, now or into the future, of a sale or purchase of the real estate.

6Reference Material 2

Table of Real Estate Portfolio After the Acquisition of the PropertyAcquisition
Building
No.

Property Name

(Note 1)Price

Facility(Type of Use)

Area

Acquisition (TBD)
Date

Investment(Actual/Rate

Proposed)(in millions)

R1 (K)HEP Five

RetailKansaiFebruary 1, 2005

23,10022.7%

R2 (K)

Kitano Hankyu Building

RetailKansaiFebruary 1, 2005

7,740

7.6%

R3 (K)Dew Hankyu Yamada

RetailKansai

February 1, 2005

6,930

6.8%

R4 (K)

Takatsuki-Josai Shopping Center

RetailKansai

November 15, 2005

8,600

8.5%

R5 (K)

Nitori Ibaraki-Kita Store (site)

RetailKansai

March 29, 2006

1,318

1.3%

Other

October 2, 2006

2,170

areas

April 9, 2007

KansaiMarch 15, 2007

R6R7 (K)Kohnan Hiroshima
Nakano-Higashi Store (site)
NU chayamachi

RetailRetail19.0%

69,16368.1%

20,041

19.7%

20,041

19.7%

November 1, 2005

2,980

2.9%

October 2, 2007

9,405

9.3%

Subtotal

12,385

12.2%

Total

101,589100.0%

Shiodome East Side Building(Note 2)OtherOfficeareas

February 2008

Subtotal
M1 (K)
M2

2.1%

19,300Subtotal
05

Ueroku F Building

Multi-purpose

Sphere Tower Tennoz

Multi-purpose

Kansai
Other
areas

Note 1: Numbers represent the classification for properties owned by Hankyu REIT by each region and type of use.
Letters represent retail (“R”), office (“O”) and multi-purpose (“M”).
Numbers represent the chronological order of the acquisition of each facility. Also, the letter “K” in parentheses to the right ofthese numbers indicates that the property is located in the Kansai region.
Note 2: In order to attract corporate tenants for our new facility Shiodome East Side Building, we list it here as an “office” facility forpromotion purposes. The proposed acquisition price will be linked to and determined by expected profitability from the results ofattracting new tenants for the building, following set rules in the Transfer of Beneficiary Rights (Membership Units) Contract. As
a general principle, this price will be within a range of 18,532,249,000 yen and 21,550,155,000 yen. For convenience, we havelisted the proposed price here as a figure in the center of this range 20,041,000,000 yen (this number is truncated to units ofmillions of yen).

7

Reference Material 3

Image of External Facade

Map of Location and Surrounding Area

8