Semiannual Report April 2024 Fiscal Period
November 1, 2023 - April 30, 2024

2-1-6 Uchisaiwaicho, Chiyoda-ku, Tokyo
https://www.kdx-reit.com/eng/

Security code：8972

To Our Unitholders
We would like to take this opportunity to express our sincere gratitude to our unitholders for your continued support.
Following the merger, KDX Realty Investment Corporation (“KDXR”) has been operating under the new structure sinceNovember 1, 2023, and we are pleased to announce that we have successfully completed our first fiscal period ended April
30, 2024.
As a diversified REIT, we are the third largest among all J-REITs with AUM of approximately 1,180 billion yen, and the largest number of properties at 353 properties.
In the fiscal period under review, we quickly realized its post-merger growth strategy by asset reshuffling (acquired sevenproperties for 45.2 billion yen, mainly hotels, and disposed three office buildings for 11 billion yen) for further growth
based on its well-diversified portfolio.
Furthermore, we have announced a new asset reshuffling on June 18, 2024, paving the way for growth in the following
fiscal period.
In addition to these efforts, we have steadily achieved internal growth leveraging the high management capabilities of
Kenedix Group maintaining high occupancy rates and increasing rents at the time of tenant replacement and renewal.
In the fiscal period under review, we acquired approximately 10 billion yen of its own investment units, the largest acquisition in J-REIT history, as a measure to return profits to our unitholders.
Moreover, we will strive to enhancement of sustainability with the aimof realizing a sustainable society,under the positioning of this as oneof the material management issues.
We sincerely appreciate your continued support and look forward toreporting our further process in themonths and years ahead.

Satoru Yamanaka

Akiko Tokuma

Hiroaki Momoi

Akiko Yamakawa

Osamu Utsunomiya

Supervisory Director

Supervisory Director

Executive Director

Supervisory Director

Supervisory Director

Executive Director, Kenedix Realty Investment Corporation
Director and COO, Head of Listed REIT Department,
Kenedix Real Estate Fund Management, Inc.

Hiroaki Momoi

Current Status for the Fiscal Period Ended April 30, 2024
No. of Properties

AUM

353

1,181.9 bn yen(No. 1 among all J-REIT)(No. 3 among all J-REIT)

DPU

Japan Credit Rating Agency, Ltd.

3,927

yen

(vs previous fiscal period:+55 yen / +1.4%)

AA(Stable)By Asset Types
Hotel
2.6%
Healthcare
7.0%

Retail
24.6%

Logistics
1.8% Office
36.9%

Diversiﬁed
Portfolio

Residential
27.1%

2

Financial Summary
Historical Operating Trends
For the 34th-38th Fiscal Periods
PeriodUnit

34th period(Apr. 2022)

35th Period(Oct. 2022)

36th Period(Apr. 2023)

37th Period(Oct. 2023)

38th Period(Apr. 2024)

Operating revenues

millions of yen

15,891

16,266

17,29016,65538,654(Rental revenues)

millions of yen

15,07815,96016,072

16,06036,596

Operating expenses

millions of yen

8,463

8,886

9,132

9,161

21,307(Property-related expenses)

millions of yen

7,309

7,707

7,793

7,878

14,796

Operating income

millions of yen

7,427

7,379

8,157

7,494

17,346

Ordinary income

millions of yen

6,497

6,452

7,208

6,572

15,049Net income (a)millions of yen

6,496

6,451

7,205

6,571

32,387

Total assets (b)(Period over period)
Interest-bearing debt (c)(Period over period)
Net assets (d)(Period over period)
Unitholders’ capital(Period over period)

millions of yen%
millions of yen%
millions of yen%
millions of yen%

464,802(+1.9)
205,150(+3.2)
231,763(+0.5)
220,970(0.0)

473,013(+1.8)
214,950(+4.8)
229,562(–0.9)
217,970(–1.4)

474,274(+0.3)
214,950(0.0)
230,482(+0.4)
217,970(0.0)

475,367(+0.2)
214,950(0.0)
231,523(+0.5)
217,970(0.0)

1,233,045(+159.4)
543,070(+152.6)
634,580(+174.1)
217,970(0.0)

Number of investment units issued and outstanding (e)unit

428,510424,215

848,430

848,430

4,079,309

Net assets per unit *1 (d)/(e)yen

540,859

270,573271,657

136,442

155,560

millions of yen

5,999

6,146

6,487

6,571

16,019Distributions per unit (f )/(e)yen

14,00014,488

7,647

7,745

3,927

(Profit distributions per unit)

yen

14,00014,488

7,647

7,745

3,927

(Distributions in excess of earnings per unit)

yen

ー

ー

ー

ー

ー

Ordinary income to total assets (annualized) *2, 3%

1.4(2.8)

1.4(2.7)

1.5(3.1)

1.4(2.7)

1.8(3.5)

Return on unitholders’ equity (annualized) *3, 4%

2.8(5.7)

2.8(5.5)

3.1(6.3)

2.8(5.6)

7.5(15.0)

49.9(–0.7)
44.1(+0.6)

48.5(–1.3)
45.4(+1.3)

48.6(+0.1)
45.3(–0.1)

48.7(+0.1)
45.2(–0.1)

51.5(+2.8)
44.0(–1.2)

%

92.3

95.2

90.0

99.9

49.4

Number of properties

properties

97

98

97

97

353

Total leasable ﬂoor aream2

491,113.35

500,015.61

494,827.85

494,758.19

2,229,863.61

Occupancy rate at end of period

%

98.3

97.8

98.4

98.2

98.8

Depreciation for the period

millions of yen

2,588

2,631

2,617

2,574

4,851

Capital expenditures for the period

millions of yen

1,289

866

997

1,168

2,843

Leasing NOI (Net Operating Income) *6

millions of yen

10,356

10,884

10,896

10,756

26,650FFO (Funds from Operation) *7

millions of yen

8,314

8,841

8,654

8,597

35,202yen

19,403

10,421

10,201

5,066

8,629

Total distributions (f )Net assets to total assets at end of period (d)/(b)(Period-on-period change)
Interest-bearing debt ratio at end of period (c)/(b)(Period-on-period change)
Payout ratio *5 (f )/(a)%%Other references

FFO per unit *1, 8*1 The Investment Corporation implemented a two-for-one split of investment units with October 31, 2022, as the record date of the split and November 1, 2022, as the effective date. Net assets per unit
and FFO per unit are calculated based on the assumption that the split of the investment units was implemented at the beginning of the 35th Fiscal Period. In addition, the Investment Corporation
implemented a two-for-one split of investment units with October 31, 2023, as the record date of the split and November 1, 2023, as the effective date. Net assets per unit and FFO per unit are calculated
based on the assumption that the split of the investment units was implemented at the beginning of the 37th Fiscal Period.
*2 Ordinary income to total assets = Ordinary income / {(Total assets at beginning of period + Total assets at end of period) / 2} × 100*3 Annualized values for the 34th Fiscal Period are calculated based on a period of 181 days, 184 days for 35th Fiscal Period, 181 days for 36th Fiscal Period, 184 days for the 37th Fiscal Period and 182 days for
38th Fiscal Period.
*4 Return on unitholders’ equity = Net income / {(Total net assets at beginning of period + Total net assets at end of period) / 2} × 100*5 Payout ratio is rounded down to the ﬁrst decimal place. Net income for the 38th fiscal period includes gain on negative goodwill of 17,338 million yen.
*6 Leasing NOI = Rental revenues – Property-related expenses + Depreciation for the period*7 FFO = Net income + Depreciation for the period + Deferred asset amortization – Gain on sale of real estate + Loss on sale of real estate - Profit and loss on buying and selling of securities and other. Net
income for the 38th fiscal period includes gain on negative goodwill of 17,338 million yen.
*8 FFO per unit = FFO / Number of investment units issued and outstanding (figures below 1 yen rounded down.)

3

Financial Statementsof
KDX Realty Investment Corporation
Thirty-eighth Fiscal Period:㻌 For the period from November 1, 2023 to April 30, 2024
With Independent Auditor’s Report

KDX Realty Investment Corporation

Balance Sheets
As of April 30, 2024
㻌As of April 30, 2024

As of October 31, 2023

In thousands of yen
AssetsCurrent assets
Cash and deposits (Notes 3)
Cash and deposits in trust (Notes 3)
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Non-current assets
Property, plant and equipment (Notes 4 and 18)
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
Buildings in trust (Note 7)
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment, net
Intangible assets (Note 4 and 18)
Leasehold rightLeasehold right in trust
Other
Total intangible assets
Investments and other assets
Investment securities (Note 15)
Lease and guarantee deposits
Lease and guarantee deposits in trustLong term deposits
Long-term prepaid expenses
Other (Notes 10,15 and 16)
Total investments and other assets
Total non-current assets
Deferred assets
Investment corporation bond issuance costs
Total deferred assets
Total assets

¥

㻌

㻌

㻌
¥

32,087,352
30,924,781
685,597
177,624
837,858
84,33264,797,547

16,110,142(5,854,479)
10,255,663
133,945(17,499)
116,445
191,590(83,321)108,269
105,381(57,640)
47,741
32,637,690
321,961,470(50,825,843)
271,135,626
5,354,210(394,478)
4,959,731
3,665,092(1,235,417)
2,429,674
1,860,856(600,593)
1,260,262
830,441,767
990
1,153,393,864

¥

㻌

㻌

28,936,646
11,732,485
377,718
111,450－
9,891
41,168,191

17,389,133(7,409,909)
9,979,223
44,486(24,076)
20,409466,277(361,477)
104,799
102,389(87,502)
14,887
27,918,010
132,515,045(46,869,269)
85,645,775
464,113(260,040)
204,072
2,284,739(1,171,285)
1,113,453
779,059(510,908)
268,150305,091,543－
430,360,327

285,257
7,380,711
8,788
7,674,757

285,257
343,78021
629,059－
30,000268,932
140,010
3,356,806
3,352,350
7,148,099
1,168,216,721

571,371
10,000122,889－
836,4631,631,344
3,172,069
434,161,456

31,01931,0191,233,045,288

38,03538,035475,367,684¥

5As of April 30, 2024

As of October 31, 2023

In thousands of yen
Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable (Notes 6)
Current portion of investment corporation bonds(Notes 6 and 15)
Current portion of long-term loans payable (Notes 6,15 and 16)
Accounts payable–otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Deposits received
Other
Total current liabilities
Non-current liabilities
Investment corporation bonds (Notes 6 and 15)
Long-term loans payable (Notes 6, 15 and 16)
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Tenant lump sum deposits in trust
Asset retirement obligations
Other (Notes 15 and 16)
Total non-current liabilities
Total liabilities
Net Assets(Note 11)
Unitholders' equity
Unitholders' capital
Deduction from unitholders' capital
Unitholders' capital, net
SurplusCapital surplus
Deduction from capital surplus
Capital surplus, net
Voluntary retained earnings
Reserve for reduction entry
Total voluntary retained earnings
Unappropriated retained earnings
Total surplus
Total unitholders' equity
Valuation and translation adjustments
Deferred gains or losses on hedges (Notes 15 and 16)
Total valuation and translation adjustments
Total net assets (Note 11)
Total liabilities and net assets

¥

㻌

㻌

2,447,735
8,900,000
5,000,000
59,010,000
1,444,156
213,585605
256,358
5,996,306
235,705
85,25083,589,703
22,700,000
447,460,000
2,447,154
37,841,963
4,305,458
94,60926,345514,875,530
598,465,234

¥

㻌

㻌

2,091,636
2,000,000
4,000,000
25,600,000
650,552
102,677782
294,586
2,722,980
75,893610
37,539,719
9,000,000
174,350,000
2,225,381
20,729,239－－－
206,304,621
243,844,341

220,970,508(2,999,551)
217,970,957

220,970,508(2,999,551)
217,970,957

385,495,522(9,999,881)
375,495,641

－
－
－

㻌

5,348,917
5,348,917
32,387,814
413,232,374
631,203,331

㻌

5,348,917
5,348,917
6,571,336
11,920,254
229,891,211

㻌
¥3,376,722
3,376,722
634,580,053
1,233,045,288

㻌
¥

1,632,131
1,632,131
231,523,343
475,367,684㻌㻌

See accompanying notes to the financial statements.

6

KDX Realty Investment Corporation

Statement of Income and Retained Earnings
For the period from November 1, 2023 to April 30, 2024
From November 1, 2023

From May 1, 2023

to April 30, 2024

to October 31, 2023

㻌In thousands of yen
Operating revenues
Rent revenue – real estate (Note 13)¥

32,583,219¥

13,942,073

Other lease business revenue (Note 13)

4,013,047

2,118,858

Gain on sale of real estate properties (Note 13)

1,494,624－

Profit and loss on buying and selling of securities

548,038

548,130

Dividends income

15,952

Total operating revenues㻌

38,654,882

46,541
㻌

16,655,603

Operating expenses
Expenses related to rent business (Note 13)

14,796,366

7,878,787

Asset management fees

2,387,097

993,342

Directors' compensation

8,400

6,300

Asset custody fees

29,47024,106

Administrative service fees

70,32860,778

Audit fees
Merger-related expenses

13,20013,2003,310,530

96,891

692,552

87,820Total operating expenses

㻌

21,307,946

9,161,227

Operating income㻌

17,346,935

7,494,376Interest income

131

45

Gain on forfeiture of unclaimed dividends

403

264

Interest on refund

59

2

594

311

2,030,995

735,897

Other operating expenses

Non-operating income

Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds

87,47036,209Financing-related expenses

165,206

132,661

7,016

7,718

Amortization of investment corporation bond issuance costs

7,246

9,514

Total non-operating expenses

㻌2,297,935

922,000

Ordinary income㻌

15,049,594

6,572,687

17,338,607－

Other non-operating expenses

Extraordinary gain
Gain on negative goodwill
Total extraordinary gain

17,338,607－

Income before income taxes㻌

32,388,202

6,572,687

Income taxes (Note 10)㻌Current

605

1,201

Deferred28

148

Total income taxes

Net income㻌Unappropriated retained earnings

1,350
6,571,336

246

Retained earnings brought forward
See accompanying notes to the financial statements.

633
32,387,568¥

32,387,814－¥

6,571,336
7

KDX Realty Investment Corporation

Statement of Changes in Net Assets
For the period from November 1, 2023 to April 30, 2024

Unitholders' equity (Note 5)

Unitholders' capital

SurplusCapital surplus

Deduction from
Unitholders'㻌unitholders'

Unitholders'

capitalcapital(Note11)

capital, net

Capital surplus

Deduction from

Capital surplus,

capital surplusnet

In thousands of yen
Balance as ofApril 30, 2023¥

220,970,508¥(2,999,551)¥

217,970,957

¥

–

–

¥

–

¥

Changes during the fiscal period
Provision of reserve for

–

–

–

–

–

–

Dividends of surplus

–

–

–

–

–

–

Net income

–

–

–

–

–

–

–㻌

–

–

–㻌

–㻌

–㻌

–

–

–

–

–

reduction entry

Items other than unitholders’equity, net
Total changes during
the fiscal period

㻌

㻌

–

㻌

Balance as of
October 31, 2023¥

220,970,508¥(2,999,551)¥

217,970,957

¥

–

–

¥

–

¥

Changes during the fiscal period
385,495,522

Merger–––385,495,522–

Dividends of surplus

–

–

–

–

–

–

Net income

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

(9,999,881)(9,999,881)

–㻌

–

–

–

–

–

Purchase of treasury
investment units
Cancellation of treasury
investment units
Items other than unitholders’equity, net
Total changes during
the fiscal period

㻌

㻌

–㻌

㻌

–㻌

㻌

–㻌

385,495,522

㻌(9,999,881)

㻌

375,495,641

Balance as ofApril 30, 2024¥

220,970,508¥(2,999,551)¥

217,970,957¥

385,495,522¥(9,999,881)¥

375,495,641

8

Unitholders' equity (Note 5)

Surplus
Voluntary retained
earnings

UnappropriatedReserve forretained earnings

reduction entry(undisposed loss)

Treasury

Total surplus

Investment

Total unitholders'UnitsequityIn thousands of yen
Balance as ofApril 30, 2023¥

4,630,856¥

7,206,005¥

11,836,861

¥

–

¥

229,807,819

Changes during the fiscal period
Provision of reserve for

718,061(718,061)–

Dividends of surplus–(6,487,944)

Net income–

6,571,336–㻌

718,061

reduction entry

Items other than unitholders’equity, net–

718,061(6,487,944)–(6,487,944)

6,571,336–

6,571,336–––(634,668)

83,392–

Total changes during
the fiscal period

–㻌

㻌

㻌

83,392

Balance as of
October 31, 2023¥

5,348,917¥

6,571,336¥

11,920,254

¥

–

¥

229,891,211

Changes during the fiscal period
Merger––385,495,522–

385,495,522

Dividends of surplus–(6,571,090)(6,571,090)–(6,571,090)

Net income–

32,387,568

32,387,568–

32,387,568

–

–

–

(9,999,881)(9,999,881)––(9,999,881)

9,999,881

–

–㻌

–

–

–

–

25,816,478

401,312,119–

Purchase of treasury
investment units
Cancellation of treasury
investment units
Items other than unitholders’equity, net
Total changes during
the fiscal period
Balance as ofApril 30, 2024¥

5,348,917¥

32,387,814¥

413,232,374

¥

–

–㻌

㻌

㻌

401,312,119¥

631,203,331

See accompanying notes to the financial statements.

9Valuation andtranslation
adjustments㻌

Deferred gains or
Total net assets

losses on hedges
In thousands of yen
Balance as ofApril 30, 2023¥

674,650¥

230,482,469

Changes during the fiscal period
Provision of reserve for––

Dividends of surplus–(6,487,944)

Net income–

6,571,336

957,481㻌

957,481

957,4811,040,873

reduction entry

Items other than unitholders’equity, net
Total changes during
the fiscal period
Balance as of
October 31, 2023¥

1,632,131¥

231,523,343

Changes during the fiscal period
Merger–385,495,522

Dividends of surplus–(6,571,090)

Net income–

32,387,568–(9,999,881)––

1,744,590㻌

1,744,590

1,744,590

403,056,710

Purchase of treasury
investment units
Cancellation of treasury
investment units
Items other than unitholders’equity, net
Total changes during
the fiscal period
Balance as ofApril 30, 2024¥

3,376,722¥

634,580,053

10

KDX Realty Investment Corporation
Statement of Cash Flows
For the period from November 1, 2023 to April 30, 2024
㻌㻌

From November 1, 2023
to April 30, 2024

㻌

From May 1, 2023
to October 31, 2023

In thousands of yen
Cash flows from operating activities
Income before income taxes¥

32,388,202¥

4,851,780

Depreciation

6,572,687
2,574,098(17,338,607)－

Interest income

(131)

(45)

Interest expenses

2,118,466

772,106

Gain on negative goodwill

7,016

7,718

(548,038)(548,130)

Decrease (increase) in operating accounts receivable(13,067)(24,866)

Decrease (increase) in consumption taxes receivable(809,381)－

Decrease (increase) in prepaid expenses

130,448(36,936)

Amortization of investment corporation bond issuance costs
Profit and loss on buying and selling of securities(1,081,592)

237,165

Increase (decrease) in accounts payable–other(147,617)(212,628)

Increase (decrease) in accrued consumption taxes(639,818)(143,010)

Increase (decrease) in advances received

247,931(151,558)(4,751)

59,847

Increase (decrease) in operating accounts payable

Increase (decrease) in deposits received
Changes in property, plant and equipment from sale

5,933,743－

Changes in property, plant and equipment in trust from sale

2,507,071－(250,264)

Decrease (increase) in long-term prepaid expenses
Other, net

㻌95,777
㻌

27,356,073

SubtotalInterest income received
Interest expenses paid㻌

Cash flows from investing activities
Purchases of property, plant and equipment
Purchases of property, plant and equipment in trust(6,084)
9,196,139

131

45(1,809,854)(775,452)(5,454)

Income taxes paid
Net cash provided by (used in) operating activities

4,683

25,540,896(1,516)
㻌

8,419,216(784,414)(49,501)(48,025,620)(968,439)(7,430)－

Proceeds from sale of investment securities

1,086,366

1,175,037(86,384)

Purchase of intangible assets
Repayments of tenant leasehold and security deposits(333,110)Proceeds from tenant leasehold and security deposits

107,650

97,150

Repayments of tenant leasehold and security deposits in trust(894,451)(442,097)

Proceeds from tenant leasehold and security deposits in trust

1,405,325

504,046

Payments of tenant lump sum deposits in trust(241,452)－

Proceeds from tenant lump sum deposits in trust

189,406－

Payments of restricted deposits in trust(136,466)(2,588)Proceeds from restricted bank deposits in trust

15,000－Other(3,887)－

Net cash provided by (used in) investing activities㻌(47,623,084)

㻌

227,223

Cash flows from financing activities
Proceeds from short-term loans payable

13,600,000

Repayments of short-term loans payable(14,450,000)(300,000)

Proceeds from long-term loans payable

71,700,000

7,800,000

Repayments of long-term loans payable(39,550,000)(9,500,000)

Redemption of investment corporation bonds(3,000,000)－

Purchase of treasury investment units(9,999,881)－

Dividends paid

(13,439,652)(6,487,508)

2,000,000

11

Net cash provided by (used in) financing activities㻌

Cash and cash equivalents at the beginning of period㻌㻌

(6,487,508)

39,492,898

㻌37,333,966

2,158,931

39,443,258

Increase in cash and cash equivalents resulting from merger
Cash and cash equivalents at the end of period (Note 3)

4,860,466(17,221,721)

Net increase (decrease) in cash and cash equivalents¥

61,714,435－¥

39,492,898

See accompanying notes to the financial statements.

12

KDX Realty Investment Corporation

Notes to the Financial Statements
For the period from November 1, 2023 to April 30, 2024

1. ORGANIZATION AND BASIS OF PRESENTATION
Organization
KDX Realty Investment Corporation (“KDXR” former trade name: Kenedix Office Investment Corporation) has conducted anabsorption type merger (“the Merger”), whereby KDXR as the surviving corporation, and Kenedix Residential Next Investment
Corporation (“KDR”) and Kenedix Retail REIT Investment Corporation (“KRR”) as the absorbed corporations on November 1, 2023,
and changed its name to KDX Realty Investment Corporation.
KDXR was established on May 6, 2005, in accordance with the Act on Investment Trusts and Investment Corporations (Act No.
198 of the year 1951, including amendments thereafter) (“Investment Trust Act”). On July 21, 2005, KDXR was listed on the Real
Estate Investment Trust Market of the Tokyo Stock Exchange, Inc. (“the Tokyo Stock Exchange”) with a total of 75,400 investment
units issued and outstanding (Securities Code: 8972). Subsequentially, KDXR raised funds through public offerings and acquired own
investment units, and as a result, as of the end of the fiscal period under review (April 30, 2024), the number of investment units issued
and outstanding totaled 4,079,309 units.
KDXR entrusts Kenedix Real Estate Fund Management, Inc. (“the Asset Management Company”) with its asset management andstrives to maximize unitholder profits by securing stable earnings and sustainable growth of investment assets. To this end, KDXR
adopts the basic policy of conducting flexible and dynamic investment that seeks to respond to the environment and market trends,
endeavors to ensure a timely response to opportunities, and form a portfolio.
During the period ended October 31, 2023, KDXR did not acquire any properties and sold 1 investment security.
During the period ended April 30, 2024, KDXR acquired 7 properties and sold 2 properties and 1 investment security.
At the end of the thirty-seventh fiscal period (fiscal period ended October 31, 2023) and thirty-eighth fiscal period (fiscal period
ended April 30, 2024), KDXR had total unitholders’ capital of 217,970 million yen with 848,430 investment units outstanding, andtotal unitholders’ capital of 217,970 million yen with 4,079,309 investment units outstanding, respectively KDXR owned a portfolioof 97 properties and 353 properties with total acquisition price of 453,316 million yen and 1,181,971 million yen at the end of thethirty-seventh and thirty-eighth fiscal periods, respectively. The occupancy rate was approximately 98.2% and 98.8% at the end of thethirty-seventh and thirty-eighth fiscal periods, respectively.
Basis of Presentation
The accompanying financial statements have been prepared in accordance with the provisions set forth in the Investment Trust Act ofJapan, the Financial Instruments and Exchange Law of Japan and related regulations, and in conformity with accounting principles
and practices generally accepted in Japan (“Japanese GAAP”), which are different in certain respects as to the application anddisclosure requirements of the International Financial Reporting Standards or accounting principles generally accepted in the UnitedStates of America.
The accompanying financial statements are basically a translation of the audited financial statements that were prepared for Japanese
domestic purposes from the accounts and records maintained by KDXR and filed with the Kanto Local Finance Bureau of the Ministryof Finance as required by the Financial Instruments and Exchange Law. In preparing the accompanying financial statements, relevant
notes have been added and certain reclassifications have been made to the financial statements issued domestically in order to present
them in a form that is more familiar to readers outside Japan. KDXR’s fiscal period is a six-month period that ends at the end of April
and the end of October each year. KDXR does not prepare consolidated financial statements because it has no subsidiaries.

132. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(A) Securities
Non-marketable securities classified as other securities are carried at cost. Cost of securities sold is determined by the moving
average method. Concerning silent partnership (tokumei kumiai, “TK”) interests, the method of incorporating the amount ofequity equivalent to the portion that corresponds to the net gain or loss of the TK is adopted.
(B) Property, Plant and Equipment (including trust assets)
Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment is calculated on a straight-line
basis over the estimated useful lives of the assets ranging as stated below:
From November 1, 2023
to April 30, 2024
Buildings
1-69 years

From May 1, 2023
to October 31, 2023
2-49 years

Structures

2-64 years

2-45 years

Machinery and equipment

2-40 years

3-17 years

Tools, furniture and fixtures

1-33 years

3-20 years(C) Intangible Assets (including trust assets)㻌 㻌 㻌 Intangible assets are amortized by the straight-line method.
Leasehold right: Fixed-term land leasehold is amortized over a contractual period under the straight-line method.
(D) Long-term Prepaid Expenses
Long-term prepaid expenses are amortized by the straight-line method.
(E) Investment Corporation Bond Issuance Costs
Investment corporation bond issuance costs are amortized over a maturity period under the straight-line method.
(F) Investment Unit Issuance Costs
Investment unit issuance costs are amortized over a period of three years under the straight-line method.
(G) Accounting Treatment of Trust Beneficiary Interests in Real Estate
For trust beneficiary interests in real estate, which are commonly utilized in the ownership of commercial properties in Japan, allassets and liabilities in trust are recorded in the relevant balance sheets and statements of income and retained earnings.
(H) Revenue Recognition
Operating revenues consist of rental revenues including base rents, common area charges and other operating revenues, which
include utility charge reimbursement, parking space rental revenues and other miscellaneous revenues. Rental revenues are
generally recognized on an accrual basis over the life of each lease. Utility charge reimbursements are recognized when earned
and their amounts can be reasonably estimated. Reimbursements from tenants including utility charge reimbursements arerecorded on a gross basis and such amounts are recorded both as revenues and expenses during the fiscal period.

14

(I)

Taxes on Property, Plant and Equipment
Property-related taxes including property taxes, city planning taxes and depreciable property taxes are imposed on properties on acalendar year basis. These taxes are generally charged to operating expenses for the period, for the portion of such taxes
corresponding to the said period. Under the Japanese tax rules, the seller of property at the time of disposal is liable for these taxes
on the property from the date of disposal to the end of the calendar year in which the property is disposed. The seller, however, isgenerally reimbursed by the purchaser for these accrued property-related tax liabilities.
When KDXR purchases properties, it typically allocates the portion of the property-related taxes related to the period following
the purchase date of each property through the end of the calendar year. The amounts of those allocated portions of the propertyrelated taxes are capitalized as part of the acquisition costs of the related properties. Capitalized property-related taxes amounted
to 117,704 thousand yen as of April 30,2024. There were no capitalized property-related taxes as of October 31, 2023. In
subsequent calendar years, such property-related taxes are charged as operating expenses in the fiscal period to which the
installments of such taxes correspond.

(J) Accounting for Revenues
The main content of the performance obligation regarding the revenue from contracts with the customers of KDXR and thenormal point of time when satisfying the said performance obligation (normal point of time when recognizing revenue) are as
follows.
1. Sale of real estate property
For the revenue from sale of real estate, etc., revenue is recorded when the buyer who is a customer gains control of
the real estate by performing the obligation of handover stipulated in the contract for real estate sales .
2. Utility charge reimbursements
For utility charge reimbursement, revenue is recorded in accordance with the supply of electricity, tap water, etc. tothe lessee who is a customer based on the lease agreement of real estate, etc. and the content of agreement incidental
to it.
Of the utility charge reimbursement, for those that are determined to fall under the category of an agent by KDXR, thenet amount obtained by deducting the amount paid to other related parties supplying electricity, gas, etc. from theamount received as the fee of electricity, gas, etc. is recognized as revenue .
(K) Income Taxes
Deferred tax assets and liabilities are computed based on the difference between the financial statements and income tax bases ofassets and liabilities using the statutory tax rates.
(L) Non-deductible Consumption Taxes
Non-deductible consumption taxes applicable to the acquisition of assets are included in the cost of acquisition for each asset .
(M) Derivative Financial Instruments
KDXR utilizes interest-rate swap contracts as derivative financial instruments only for the purpose of hedging its exposure tochanges in interest rates. KDXR deferred recognition of gains or losses resulting from changes in fair value of interest-rate swap
contracts because these contracts met the criteria for deferral hedging accounting. However, KDXR adopted special treatment forinterest-rate swap contracts if they met the criteria for hedging accounting under this treatment. The hedge effectiveness for theinterest-rate swap contracts is assessed each fiscal period except for those that meet the criteria of special treatment.
(N) Cash and Cash Equivalents
Cash and cash equivalents consist of cash on hand, deposits placed with banks and short-term investments which are highly liquid,readily convertible to cash and with insignificant risk of market value fluctuation, with maturities of three months or less fromthe date of purchase.
15

(O) Presentation of Amounts
Amounts of less than one thousand yen have been truncated in the Japanese financial statements prepared in accordance withJapanese GAAP and filed with regulatory authorities in Japan. Unless otherwise noted, amounts are rounded down and ratios arerounded in the accompanying financial statements.
Totals shown in the accompanying financial statements do not necessarily agree with the sums of the individual amounts.
(P)

Note on Changes in Accounting Estimates
Taking the opportunity of the merger with Kenedix Residential Next Investment Corporation and Kenedix Retail REIT
Corporation on November 1, 2023, KDXR is reconsidering the asset management policy and organization in order to respondto the environment change by adding a variety of assets. As a part of this reconsideration, KDXR has decided to carry out
building repair and management in accordance with a long-term repair and maintenance plan formulated based on an external
expert's report, with the aim of achieving longer-term rental operations and holistic portfolio management by systematically
implementing repair and renewal work that better matches the actual conditions of individual managed properties. As a result,it became possible to foresee the operating period more precisely, and therefore, the method of applying the economic usefulforecast period to the useful lives of some buildings and buildings in trust was changed from the current operating period. As aresult, operating expenses for the current period decreased by 880,283 thousand yen, and operating income, ordinary income,and income before income taxes increased by the same amount.

3. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of the following as of April 30, 2024, and October 31, 2023.
As of April 30, 2024

As of October 31, 2023

In thousands of yen
Cash and deposits¥

32,087,352¥

28,936,646

Cash and deposits in trust

30,924,781

11,732,485

Restricted deposits in trust (Note)(1,297,698)(1,176,232)

Cash and cash equivalents in trust¥

61,714,435¥

39,492,898

Note: Restricted deposits in trust are retained for the repayment of tenant leasehold and security deposits in trust.

4. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
Property, plant and equipment and intangible assets consist of the following as of April 30, 2024.
Type of asset

Balance atthe beginningof period

Increaseduring theperiodDecreaseduring theperiodBalanceatthe endof period

Depreciation
Accumulated
depreciation

Depreciatio
n for theperiodNetbalance atthe end of
periodRemarks

Note 1
Note 2(In thousands of yen)
Buildings
Structures
Machinery andequipment
Tools, furnitureand fixtures
Land
Property,plant andequipment

Subtotal
Buildings in
trust
Structures intrust
Machinery andequipment in
trust
Tools, furnitureand fixtures intrust¥17,389,133¥2,170,911¥3,449,902¥16,110,142¥5,854,479¥195,537¥10,255,663

44,486

105,908

16,448133,945

17,4992,489

116,445466,277

46,979321,666

191,590

83,321

1,789

108,269

102,389

40,47737,485

105,381

57,6401,788

47,741

27,918,010

8,885,182

4,165,501

32,637,690––

32,637,690

45,920,297

11,249,459

7,991,004

49,178,752

6,012,941

201,605

43,165,810¥132,515,045¥190,201,973¥755,548¥321,961,470¥50,825,843¥4,347,358¥271,135,626

464,113

4,897,254

7,157

5,354,210

394,478

135,157

4,959,731

2,284,739

1,381,224

871

3,665,092

1,235,417

64,9592,429,674

779,059

1,085,380

3,584

1,860,856

600,593

92,855

1,260,262

Note 1
Note 2
Note 1
Note 216

305,091,543

527,331,665

1,981,441

830,441,767––

830,441,767

–

990

–

990

–

–

990

Subtotal

441,134,500

724,898,488

2,748,603 1,163,284,386

53,056,332

4,640,331 1,110,228,053

Total property, plant andequipment

487,054,798

736,147,948

10,739,608 1,212,463,138

59,069,273

4,841,937 1,153,393,864

Land in trust
Construction inprogress intrust

Leasehold right
Intangible
assetsLeasehold rightin trust
Other

Total intangible assets
Total

¥

290,050

–

¥

–

¥

¥

290,050

¥

4,792

¥

–

¥ 285,257
7,380,711

363,784

7,044,970–

7,408,755

28,044

8,040

6,306

18,094–

24,401

15,613

1,454

8,788

660,141

7,063,065–

7,723,207

48,4509,495

7,674,757¥ 487,714,939¥743,211,014¥10,739,608 ¥1,220,186,345¥59,117,723

Note 1
Note 2¥4,851,432 ¥1,161,068,621

Note 1: The amount of increase during the period is primarily attributable to business combination and the acquisition of real estateof 7 properties.
Note 2: The amount of decrease during the period is primarily attributable to the sales of real estate of 2 properties.
Property, plant and equipment and intangible assets consist of the following as of October 31, 2023.
Type of asset

Depreciation
Depreciation
for theperiodNetbalance atthe end of
period¥ 7,409,909¥ 287,840¥ 9,979,223

24,076

1,068

20,409466,277

361,477

13,214

104,799

Balance atthe end of
periodIncreaseduring theperiodDecreaseduring theperiod¥㻌 74,945¥㻌 㻌 㻌 㻌 㻌 –¥ 17,389,133

39,836

4,649–

44,486

463,508

2,769–

Balance atthe beginningof period

Accumulated
depreciation(In thousands of yen)
Buildings¥ 17,314,188

Structures
Machinery andequipment
Tools, furnitureand fixturesLand

102,389––

102,389

87,5022,754

14,887

27,918,010––

27,918,010––

27,918,010

Subtotal

45,837,933

82,364–45,920,297

7,882,966

304,879

38,037,331¥ 131,523,808¥ 1,002,959¥㻌 11,723¥ 132,515,045¥ 46,869,269¥ 2,163,652¥ 85,645,775

435,544

30,631

2,063

464,113260,040

12,502204,072

2,245,231

39,507–2,284,739

1,171,285

65,932

1,113,453

766,142

12,916–

779,059

510,908

26,340268,150

Land in trust

305,091,543––

305,091,543––

305,091,543

Subtotal

440,062,272

1,086,015

13,786441,134,500

48,811,504

2,268,427

392,322,996

Total property, plant andequipment

485,900,205

1,168,379

13,786

487,054,798

56,694,470

2,573,306

430,360,327–¥ 290,050¥–¥ 㻌 285,257
343,780

Property,plant andequipment

Intangible
assetsBuildings in
trust
Structures intrust
Machinery andequipment in
trust
Tools, furnitureand fixtures in
trust

–

Leasehold right¥ 290,050

Leasehold rightin trust

363,784––

363,784

20,003

774

6,306

–

–

6,306

6,285

18

21

660,141––

660,141

31,081

792

629,059¥ 486,560,346¥ 1,168,379¥㻌 13,786¥ 487,714,939¥ 56,725,552

Other
Total intangible assets
Total

¥

¥

4,792

¥

Remarks¥2,574,098 ¥ 430,989,387

㻌 5. UNITHOLDERS’ EQUITY
Total number of authorized investment units and total number of investment units issued and outstanding are as follows:
From November 1, 2023
From May 1, 2023
to April 30, 2024
to October 31, 2023
Total number of authorized investment units
20,000,000
4,000,000
Total number of investment units issued and outstanding

4,079,309

848,430

17

6. SHORT-TERM LOANS PAYABLE, LONG-TERM LOANS PAYABLE AND INVESTMENTCORPORATION BONDS
The following summarizes short-term loans payable, long-term loans payable and investment corporation bonds outstanding as ofApril 30, 2024:
Classification
Short-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)August 31, 2023

August 31, 2024

0.332%

October 31, 2023

October 31, 2024

0.207%

1,000,000

February 1, 2024

January 31, 2025

0.232%

5,000,000

April 30, 2024

April 30, 2025

0.318%

1,600,000

April 30, 2024

April 30, 2025

0.318%¥

300,000
8,900,000

Subtotal
Current portion of long-term loans payable㻌 1,000,000

October 31, 2014

October 31, 2024

1.257%

October 31, 2014

October 31, 2024

1.259%¥

2,000,000
1,000,000

January 30, 2015

January 31, 2025

1.161%

1,500,000

February 18, 2015

February 28, 2025

1.314%

1,250,000

February 27, 2015

February 28, 2025

1.153%

2,100,000

March 12, 2015

February 28, 2025

1.218%

1,000,000

March 31, 2015

March 31, 2025

1.266%

2,500,000

August 31, 2015

August 31, 2024

0.732%

1,700,000

August 31, 2015

August 31, 2024

0.731%

150,000

August 31, 2015

August 31, 2024

1.193%

1,000,000

September 30, 2015

September 30, 2024

1.065%

2,000,000

October 2, 2015

April 16, 2025

0.809%

1,500,000

October 2, 2015

April 16, 2025

0.809%

400,000

October 27, 2015

April 27, 2025

0.757%

1,000,000

October 30, 2015

October 31, 2024

0.989%

1,000,000

April 21, 2016

September 30, 2024

0.803%

450,000

April 21, 2016

September 30, 2024

0.760%

890,000

April 28, 2016

April 28, 2025

0.819%

1,000,000

August 31, 2016

August 31, 2024

0.713%

1,000,000

October 31, 2016

October 31, 2024

0.668%

1,000,000

April 27, 2017

October 31, 2024

0.772%

1,500,000

April 27, 2017

October 31, 2024

0.772%

400,000

April 27, 2017

October 31, 2024

0.772%

400,000

April 27, 2017

October 31, 2024

0.772%

300,000

April 27, 2017

October 31, 2024

0.696%

600,000

April 27, 2017

October 31, 2024

0.815%

600,000

April 27, 2017

October 31, 2024

0.814%

500,000

April 27, 2017

October 31, 2024

0.814%

200,000

August 31, 2017

August 31, 2024

0.624%

500,000

August 31, 2017

August 31, 2024

0.661%

500,000

August 31, 2017

February 28, 2025

0.665%

1,500,000

September 28, 2018

March 31, 2025

0.913%

700,000

June 3, 2019

November 30, 2024

0.363%

400,000

August 30, 2019

August 31, 2024

0.460%

650,000

October 31, 2019

October 31, 2024

0.550%

820,000

January 31, 2020

January 31, 2025

0.406%

700,000

February 10, 2020

January 31, 2025

0.498%

400,000
400,000

February 10, 2020

January 31, 2025

0.478%

November 2, 2020

April 30, 2025

0.478%

500,000

January 29, 2021

January 31, 2025

0.409%

1,200,000

18

Classification
Current portion of long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

January 29, 2021

January 31, 2025

0.359%

April 21, 2021

April 30, 2025

0.407%¥

1,100,000
600,000

April 21, 2021

April 30, 2025

0.407%

500,000

April 21, 2021

April 30, 2025

0.407%

400,000

April 21, 2021

April 30, 2025

0.400%

500,000

July 30, 2021

July 31, 2024

0.252%

1,000,000

November 30, 2021

October 31, 2024

0.289%

500,000

November 30, 2021

October 31, 2024

0.289%

500,000

November 30, 2021

October 31, 2024

0.289%

300,000

November 30, 2021

October 31, 2024

0.250%

2,500,000

April 28, 2022

October 31, 2024

0.354%

1,000,000

April 28, 2022

April 30, 2025

0.447%

4,000,000

April 28, 2022

April 30, 2025

0.306%

1,000,000

June 30, 2022

June 30, 2024

0.306%

2,000,000
1,000,000

June 30, 2022

June 30, 2024

0.306%

August 31, 2022

August 31, 2024

0.350%

1,600,000

August 31, 2022

February 28, 2025

0.374%

1,600,000

March 1, 2023

February 28, 2025

0.181%

500,000

November 1, 2023

November 30, 2024

0.207%

1,200,000

October 30, 2015

October 30, 2025

1.114%

October 30, 2015

October 30, 2025

1.114%

2,000,000

October 30, 2015

October 30, 2025

1.114%

2,500,000

October 30, 2015

October 30, 2025

1.121%

2,500,000

November 12, 2015

November 30, 2025

1.173%

1,000,000

January 29, 2016

January 29, 2026

1.074%

2,000,000

January 29, 2016

January 29, 2026

1.024%

1,800,000

February 18, 2016

February 18, 2026

0.998%

1,000,000

February 18, 2016

February 18, 2026

0.998%

500,000

March 31, 2016

March 31, 2026

0.898%

1,000,000
2,670,000

59,010,000

SubtotalLong-term loans payable¥㻌1,500,000

April 21, 2016

April 21, 2026

0.932%

April 22, 2016

October 31, 2025

0.888%

890,000

April 28, 2016

April 30, 2026

0.903%

2,500,000

April 28, 2016

April 30, 2026

0.835%

2,000,000

April 28, 2016

April 30, 2026

0.865%

1,000,000

July 29, 2016

July 31, 2026

0.613%

1,500,000

August 1, 2016

July 31, 2025

0.660%

1,000,000

August 2, 2016

July 31, 2026

0.544%

1,000,000

August 30, 2016

August 31, 2026

0.816%

1,500,000

August 31, 2016

August 31, 2025

0.797%

1,000,000

August 31, 2016

August 31, 2025

0.797%

500,000

August 31, 2016

August 31, 2025

0.670%

2,000,000

August 31, 2016

August 31, 2025

0.751%

500,000

August 31, 2016

August 31, 2026

0.906%

3,000,000

October 31, 2016

October 31, 2026

0.876%

2,500,000

October 31, 2016

October 31, 2026

0.760%

1,000,000

October 31, 2016

October 31, 2026

0.734%

4,000,000

October 31, 2016

October 31, 2026

0.826%

1,500,000

November 1, 2016

October 31, 2025

0.773%

1,000,000

December 12, 2016

November 30, 2026

0.982%

500,000

December 28, 2016

December 28, 2026

0.950%

1,500,000

January 16, 2017

January 31, 2027

0.860%

500,000

January 31, 2017

January 31, 2027

0.853%

700,000

19

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

January 31, 2017

January 31, 2027

1.049%

January 31, 2017

January 31, 2027

1.049%¥

2,000,000

January 31, 2017

January 31, 2027

1.002%

500,000

March 28, 2017

March 31, 2027

0.850%

500,000

May 18, 2017

October 31, 2026

0.903%

500,000

May 18, 2017

May 18, 2027

1.033%

500,000

May 18, 2017

May 18, 2027

1.033%

500,000

May 18, 2017

May 18, 2027

1.033%

400,000

May 18, 2017

May 18, 2027

1.050%

500,000

May 18, 2017

May 18, 2027

1.049%

500,000

May 18, 2017

May 18, 2027

1.050%

300,000

June 30, 2017

June 30, 2027

0.849%

1,500,000

August 10, 2017

July 28, 2027

0.800%

3,500,000

August 22, 2017

August 22, 2027

0.900%

1,000,000

August 22, 2017

August 22, 2027

0.900%

1,000,000

August 22, 2017

August 22, 2027

0.900%

1,000,000

August 22, 2017

August 22, 2027

0.928%

1,200,000

August 22, 2017

August 22, 2027

0.928%

1,000,000

August 22, 2017

August 22, 2027

0.928%

500,000

August 22, 2017

August 22, 2027

0.928%

500,000

August 31, 2017

February 28, 2026

0.749%

1,000,000
1,000,000

1,000,000

August 31, 2017

February 28, 2026

0.749%

September 21, 2017

September 30, 2025

0.680%

1,500,000

September 21, 2017

March 31, 2027

0.732%

1,000,000

September 21, 2017

September 21, 2027

0.873%

1,000,000

September 21, 2017

September 30, 2027

0.851%

2,500,000

September 29, 2017

September 30, 2026

0.918%

1,500,000

September 29, 2017

September 29, 2027

0.930%

500,000

September 29, 2017

September 29, 2027

1.029%

1,500,000

September 29, 2017

September 29, 2028

1.100%

1,500,000

October 3, 2017

October 3, 2027

1.035%

500,000

October 31, 2017

October 31, 2027

0.810%

2,500,000

November 13, 2017

November 13, 2027

0.931%

3,000,000

December 7, 2017

November 30, 2027

0.899%

1,400,000

December 7, 2017

November 30, 2027

0.820%

1,200,000

December 7, 2017

November 30, 2027

0.969%

1,000,000

December 7, 2017

November 30, 2027

0.939%

1,000,000

December 7, 2017

November 30, 2027

0.869%

1,000,000

December 7, 2017

November 30, 2027

0.899%

800,000

December 7, 2017

November 30, 2027

0.869%

600,000

December 28, 2017

December 28, 2025

0.744%

500,000

December 28, 2017

December 28, 2026

0.878%

500,000

December 28, 2017

December 28, 2027

0.864%

500,000

February 13, 2018

February 10, 2028

1.000%

1,200,000

March 12, 2018

March 31, 2028

0.914%

1,500,000

March 26, 2018

March 31, 2027

0.808%

1,000,000

March 26, 2018

March 31, 2028

0.902%

1,000,000

April 19, 2018

April 30, 2027

0.988%

900,000

April 23, 2018

April 30, 2027

0.985%

2,600,000

April 27, 2018

April 30, 2026

0.902%

2,000,000

April 27, 2018

April 30, 2028

0.832%

1,000,000

20

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

May 31, 2018

May 31, 2026

0.907%

May 31, 2018

May 31, 2027

0.999%¥

1,500,000

1,000,000

May 31, 2018

May 31, 2027

0.900%

500,000

May 31, 2018

May 31, 2027

0.999%

500,000

May 31, 2018

May 31, 2027

0.999%

500,000

July 30, 2018

January 30, 2027

0.900%

500,000

July 31, 2018

July 31, 2028

0.988%

500,000

August 2, 2018

February 2, 2026

0.799%

1,500,000

August 2, 2018

February 2, 2026

0.799%

1,400,000

August 2, 2018

February 2, 2026

0.799%

900,000

August 2, 2018

February 2, 2026

0.799%

500,000

August 2, 2018

February 2, 2026

0.799%

500,000

August 2, 2018

February 2, 2026

0.799%

400,000

August 2, 2018

February 2, 2026

0.799%

400,000

August 2, 2018

February 2, 2026

0.799%

400,000

August 2, 2018

February 2, 2026

0.799%

400,000

August 2, 2018

February 2, 2026

0.799%

300,000

August 2, 2018

February 2, 2026

0.799%

300,000

August 20, 2018

August 31, 2025

0.696%

500,000

August 20, 2018

August 31, 2028

1.003%

1,000,000

August 20, 2018

August 31, 2028

1.003%

1,000,000

August 20, 2018

August 31, 2028

1.003%

500,000

August 20, 2018

August 31, 2028

0.966%

500,000

August 31, 2018

August 31, 2025

0.700%

500,000

August 31, 2018

August 31, 2025

0.723%

300,000

August 31, 2018

February 28, 2027

0.657%

1,050,000

August 31, 2018

February 28, 2027

0.657%

500,000

August 31, 2018

February 28, 2027

0.657%

500,000

August 31, 2018

February 28, 2027

0.657%

500,000

August 31, 2018

February 28, 2027

0.657%

250,000

August 31, 2018

February 28, 2027

0.884%

1,400,000

August 31, 2018

February 28, 2027

0.825%

800,000

August 31, 2018

August 31, 2028

1.012%

700,000

September 28, 2018

September 30, 2026

0.920%

700,000

September 28, 2018

September 30, 2028

0.682%

1,000,000

September 28, 2018

September 30, 2028

0.682%

800,000

September 28, 2018

September 30, 2028

0.682%

500,000

October 31, 2018

October 31, 2028

1.013%

1,500,000

October 31, 2018

October 31, 2028

0.910%

1,000,000

October 31, 2018

October 31, 2028

1.013%

500,000

March 28, 2019

March 31, 2029

0.838%

1,400,000

March 29, 2019

March 31, 2026

0.726%

700,000

March 29, 2019

March 31, 2026

0.676%

500,000

March 29, 2019

March 31, 2026

0.726%

500,000

March 29, 2019

March 31, 2026

0.726%

400,000

March 29, 2019

March 31, 2026

0.676%

400,000

March 29, 2019

March 31, 2028

0.910%

1,850,000

March 29, 2019

March 31, 2028

0.860%

1,300,000

March 29, 2019

March 31, 2029

0.839%

2,950,000

June 3, 2019

May 31, 2025

0.330%

2,000,000

June 3, 2019

November 30, 2025

0.484%

500,000

June 14, 2019

December 28, 2026

0.517%

500,000

June 14, 2019

April 30, 2027

0.605%

1,000,000

21

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

June 14, 2019

March 31, 2029

0.725%

July 31, 2019

April 30, 2027

0.554%¥

1,000,000

1,000,000
1,000,000

July 31, 2019

April 30, 2027

0.554%

August 30, 2019

August 31, 2026

0.585%

890,000

September 17, 2019

August 31, 2026

0.572%

1,000,000

September 30, 2019

September 30, 2026

0.489%

1,000,000

September 30, 2019

March 31, 2027

0.531%

900,000

September 30, 2019

March 31, 2027

0.425%

800,000

September 30, 2019

March 31, 2028

0.718%

1,370,000

October 31, 2019

January 31, 2028

0.750%

1,270,000

October 31, 2019

April 30, 2028

0.670%

650,000

November 1, 2019

October 31, 2026

0.520%

1,500,000

November 1, 2019

October 31, 2026

0.644%

1,000,000

November 1, 2019

October 31, 2026

0.644%

1,000,000

November 1, 2019

October 31, 2026

0.550%

500,000

November 1, 2019

October 31, 2026

0.644%

300,000

November 1, 2019

October 31, 2029

0.830%

500,000

November 29, 2019

November 30, 2026

0.600%

1,500,000

January 31, 2020

January 31, 2027

0.526%

1,500,000

January 31, 2020

January 31, 2029

0.675%

1,500,000

March 2, 2020

February 28, 2027

0.464%

500,000

March 2, 2020

February 28, 2027

0.414%

500,000

March 2, 2020

February 28, 2027

0.414%

500,000

March 2, 2020

February 28, 2027

0.414%

500,000

March 2, 2020

February 28, 2027

0.414%

400,000

March 2, 2020

February 28, 2027

0.450%

400,000

March 2, 2020

February 29, 2028

0.531%

200,000

March 12, 2020

February 28, 2026

0.361%

1,800,000

March 31, 2020

March 31, 2028

0.642%

1,000,000

June 30, 2020

June 30, 2028

0.646%

1,000,000

June 30, 2020

June 30, 2028

0.646%

800,000

June 30, 2020

June 30, 2028

0.616%

500,000

June 30, 2020

June 30, 2028

0.646%

2,000,000

June 30, 2020

June 30, 2028

0.646%

2,000,000

June 30, 2020

June 30, 2028

0.646%

700,000

June 30, 2020

June 30, 2028

0.510%

2,000,000

July 29, 2020

July 31, 2028

0.691%

1,750,000

July 29, 2020

July 31, 2028

0.641%

1,750,000

July 29, 2020

July 31, 2028

0.641%

1,000,000

July 29, 2020

July 31, 2028

0.641%

500,000

July 29, 2020

July 31, 2028

0.641%

500,000

July 29, 2020

July 31, 2028

0.641%

500,000

July 31, 2020

July 31, 2028

0.636%

2,700,000

July 31, 2020

July 31, 2028

0.686%

1,000,000

August 3, 2020

July 31, 2028

0.637%

800,000

August 31, 2020

August 31, 2028

0.640%

500,000

August 31, 2020

August 31, 2028

0.690%

300,000

August 31, 2020

August 31, 2030

0.705%

1,500,000

September 24, 2020

September 30, 2028

0.648%

840,000

September 30, 2020

September 30, 2025

0.396%

1,000,000

September 30, 2020

September 30, 2027

0.511%

1,000,000

22

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

September 30, 2020

September 30, 2028

0.758%

September 30, 2020

September 30, 2028

0.658%¥

700,000

September 30, 2020

September 30, 2028

0.658%

800,000

September 30, 2020

September 30, 2028

0.658%

1,330,000

September 30, 2020

September 30, 2028

0.558%

500,000

September 30, 2020

September 30, 2028

0.608%

400,000

September 30, 2020

September 30, 2028

0.550%

800,000

September 30, 2020

September 30, 2030

0.738%

700,000

October 27, 2020

October 31, 2027

0.637%

300,000

October 30, 2020

April 30, 2027

0.542%

1,400,000

October 30, 2020

October 31, 2030

0.803%

1,500,000

October 30, 2020

October 31, 2030

0.803%

300,000

November 2, 2020

October 31, 2027

0.585%

1,000,000

900,000

November 12, 2020

April 30, 2027

0.552%

1,300,000

November 12, 2020

November 12, 2030

0.808%

700,000

November 12, 2020

November 12, 2030

0.808%

500,000

November 30, 2020

May 31, 2027

0.516%

200,000

November 30, 2020

November 30, 2027

0.617%

2,000,000

November 30, 2020

November 30, 2030

0.763%

900,000

November 30, 2020

November 30, 2030

0.763%

800,000

November 30, 2020

November 30, 2030

0.763%

200,000

January 29, 2021

January 31, 2028

0.599%

1,000,000

January 29, 2021

January 31, 2028

0.527%

1,200,000

January 29, 2021

January 31, 2030

0.678%

2,300,000

January 29, 2021

January 31, 2030

0.678%

2,000,000

January 29, 2021

January 31, 2030

0.678%

2,000,000

January 29, 2021

November 30, 2030

0.755%

800,000

February 10, 2021

January 31, 2029

0.725%

450,000

February 10, 2021

January 31, 2030

0.809%

3,000,000

February 10, 2021

January 31, 2030

0.809%

700,000

February 10, 2021

January 31, 2030

0.809%

500,000

February 10, 2021

January 31, 2030

0.809%

450,000

February 10, 2021

January 31, 2030

0.809%

400,000

February 10, 2021

January 31, 2031

0.888%

1,500,000

February 26, 2021

February 28, 2026

0.535%

2,400,000

February 26, 2021

February 28, 2026

0.535%

1,600,000

February 26, 2021

February 28, 2026

0.535%

550,000

February 26, 2021

February 28, 2026

0.535%

500,000

February 26, 2021

February 28, 2026

0.535%

500,000

February 26, 2021

February 28, 2026

0.535%

350,000

February 26, 2021

February 28, 2026

0.535%

300,000

March 31, 2021

March 31, 2029

0.677%

1,350,000

April 27, 2021

April 30, 2026

0.461%

500,000

April 27, 2021

April 30, 2026

0.461%

200,000

April 27, 2021

October 31, 2026

0.490%

1,000,000

April 27, 2021

October 31, 2026

0.475%

400,000

April 27, 2021

October 31, 2027

0.548%

1,600,000

April 27, 2021

October 31, 2027

0.548%

400,000

April 27, 2021

October 31, 2027

0.548%

300,000

April 27, 2021

October 31, 2027

0.548%

300,000

April 27, 2021

October 31, 2027

0.525%

600,000

April 27, 2021

April 30, 2031

0.856%

500,000

April 30, 2021

April 30, 2026

0.426%

500,00023

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

April 30, 2021

April 30, 2026

0.350%

April 30, 2021

October 31, 2027

0.525%¥

200,000

500,000

April 30, 2021

April 30, 2028

0.601%

800,000

April 30, 2021

April 30, 2028

0.601%

700,000

April 30, 2021

April 30, 2028

0.601%

600,000

April 30, 2021

April 30, 2028

0.601%

600,000

April 30, 2021

April 30, 2028

0.601%

500,000

April 30, 2021

April 30, 2028

0.550%

500,000

April 30, 2021

April 30, 2028

0.550%

500,000

April 30, 2021

April 30, 2028

0.601%

200,000

April 30, 2021

April 30, 2031

0.824%

300,000

July 12, 2021

June 30, 2028

0.484%

500,000

July 30, 2021

July 31, 2026

0.350%

1,000,000

July 30, 2021

January 31, 2027

0.350%

500,000

July 30, 2021

July 31, 2029

0.467%

1,000,000

July 30, 2021

January 31, 2030

0.598%

1,400,000

July 30, 2021

January 31, 2030

0.575%

1,000,000

July 30, 2021

January 31, 2030

0.700%

1,000,000

August 2, 2021

February 28, 2027

0.358%

800,000

August 2, 2021

February 28, 2027

0.358%

500,000

August 2, 2021

February 28, 2027

0.358%

500,000

August 10, 2021

February 28, 2029

0.533%

350,000

August 10, 2021

February 28, 2029

0.433%

300,000

August 10, 2021

February 28, 2030

0.585%

1,200,000

August 10, 2021

February 28, 2030

0.575%

1,200,000

August 10, 2021

August 31, 2031

0.638%

1,000,000

August 31, 2021

February 28, 2029

0.540%

500,000

August 31, 2021

February 28, 2029

0.525%

600,000

August 31, 2021

February 28, 2030

0.602%

600,000

September 30, 2021

September 30, 2026

0.450%

500,000

October 1, 2021

March 31, 2026

0.387%

500,000

October 1, 2021

March 31, 2026

0.387%

500,000

October 1, 2021

September 30, 2029

0.599%

800,000

October 1, 2021

September 30, 2029

0.599%

700,000

October 1, 2021

September 30, 2029

0.599%

500,000

November 30, 2021

April 30, 2026

0.300%

500,000

November 30, 2021

April 30, 2026

0.300%

500,000

November 30, 2021

April 30, 2026

0.300%

500,000

November 30, 2021

November 30, 2026

0.325%

600,000

November 30, 2021

November 30, 2026

0.325%

500,000

November 30, 2021

November 30, 2026

0.412%

500,000

November 30, 2021

November 30, 2026

0.412%

500,000

November 30, 2021

November 30, 2026

0.350%

500,000

November 30, 2021

November 30, 2026

0.384%

1,000,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.325%

1,000,000

November 30, 2021

November 30, 2026

0.350%

1,000,000

November 30, 2021

November 30, 2028

0.511%

1,000,000

November 30, 2021

November 30, 2029

0.450%

500,00024

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

December 10, 2021

November 30, 2025

0.314%

December 10, 2021

November 30, 2025

0.314%¥

500,000

December 10, 2021

November 30, 2025

0.314%

200,000

December 10, 2021

May 31, 2029

0.529%

1,000,000

December 10, 2021

November 30, 2029

0.561%

500,000

December 10, 2021

November 30, 2029

0.561%

500,000

December 10, 2021

November 30, 2030

0.631%

1,000,000

December 10, 2021

November 30, 2030

0.631%

700,000

December 10, 2021

November 30, 2031

0.703%

500,000

December 10, 2021

November 30, 2031

0.703%

300,000

February 10, 2022

January 31, 2029

0.722%

2,600,000

February 10, 2022

January 31, 2029

0.722%

600,000

February 10, 2022

January 31, 2029

0.722%

400,000

February 10, 2022

January 31, 2029

0.722%

400,000

February 10, 2022

January 31, 2029

0.722%

300,000

February 10, 2022

January 31, 2029

0.722%

300,000

February 10, 2022

January 31, 2029

0.640%

800,000

February 10, 2022

January 31, 2031

0.879%

1,600,000

April 28, 2022

October 31, 2025

0.466%

1,500,000

April 28, 2022

October 31, 2026

0.509%

500,000

April 28, 2022

April 30, 2027

0.350%

500,000

April 28, 2022

May 31, 2027

0.350%

1,000,000

April 28, 2022

October 31, 2027

0.632%

1,500,000

April 28, 2022

April 30, 2028

0.681%

1,000,000

April 28, 2022

March 31, 2029

0.610%

500,000

June 1, 2022

May 31, 2026

0.425%

300,000

June 1, 2022

May 31, 2026

0.425%

300,000

June 30, 2022

June 30, 2025

0.200%

2,000,000

June 30, 2022

June 30, 2025

0.200%

1,000,000

June 30, 2022

June 30, 2025

0.200%

500,000

July 29, 2022

August 31, 2025

0.380%

1,000,000

500,000

July 29, 2022

July 31, 2027

0.550%

1,100,000

August 31, 2022

August 31, 2025

0.422%

1,100,000

August 31, 2022

August 31, 2025

0.395%

500,000

August 31, 2022

August 31, 2025

0.395%

1,000,000

August 31, 2022

August 31, 2025

0.395%

500,000

August 31, 2022

August 31, 2026

0.430%

2,700,000

August 31, 2022

February 28, 2027

0.604%

600,000

August 31, 2022

February 28, 2027

0.549%

700,000

August 31, 2022

August 31, 2027

0.501%

2,400,000

August 31, 2022

August 31, 2027

0.420%

1,000,000

August 31, 2022

August 31, 2027

0.350%

300,000

August 31, 2022

August 31, 2029

0.800%

950,000

August 31, 2022

August 31, 2029

0.720%

500,000

August 31, 2022

August 31, 2029

0.711%

1,600,000

August 31, 2022

August 31, 2029

0.685%

1,950,000

August 31, 2022

August 31, 2029

0.685%

1,000,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

200,000

August 31, 2022

August 31, 2029

0.525%

1,000,000

August 31, 2022

August 31, 2029

0.525%

500,000

25

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)August 31, 2022

August 31, 2029

0.525%

August 31, 2022

August 31, 2029

0.525%¥

1,000,000
500,000

October 26, 2022

September 30, 2026

0.720%

500,000

October 26, 2022

September 30, 2026

0.720%

400,000

October 26, 2022

September 30, 2026

0.647%

500,000

October 26, 2022

April 30, 2028

0.897%

500,000

October 26, 2022

April 30, 2028

0.897%

500,000

October 26, 2022

April 30, 2028

0.897%

300,000

October 26, 2022

October 31, 2028

0.790%

500,000

October 26, 2022

September 30, 2030

0.620%

600,000

October 31, 2022

October 31, 2025

0.481%

500,000

October 31, 2022

April 30, 2026

0.373%

500,000

December 13, 2022

November 30, 2026

0.556%

1,300,000

January 13, 2023

January 31, 2027

0.666%

800,000

January 13, 2023

January 31, 2027

0.666%

500,000

January 31, 2023

January 31, 2028

0.790%

500,000

February 28, 2023

August 31, 2025

0.306%

1,500,000

February 28, 2023

August 31, 2025

0.306%

1,500,000

February 28, 2023

February 29, 2028

1.008%

1,000,000

February 28, 2023

February 29, 2028

1.008%

1,000,000

February 28, 2023

February 29, 2028

0.841%

1,700,000

February 28, 2023

February 29, 2028

0.793%

1,000,000

February 28, 2023

February 28, 2029

0.888%

500,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

400,000

February 28, 2023

February 28, 2029

0.888%

350,000

March 13, 2023

March 31, 2030

1.050%

2,000,000

March 13, 2023

March 31, 2031

1.186%

1,800,000

March 31, 2023

March 31, 2026

0.430%

500,000

March 31, 2023

March 31, 2027

0.549%

1,350,000

March 31, 2023

September 30, 2028

0.717%

1,500,000

March 31, 2023

September 30, 2029

0.840%

1,500,000

March 31, 2023

September 30, 2029

0.840%

600,000

March 31, 2023

March 31, 2030

0.703%

150,000

April 28, 2023

October 31, 2028

0.798%

500,000

June 30, 2023

June 30, 2026

0.281%

500,000

July 31, 2023

July 31, 2025

0.282%

800,000

July 31, 2023

July 31, 2025

0.207%

1,000,000

July 31, 2023

July 31, 2026

0.282%

200,000

July 31, 2023

July 31, 2026

0.282%

300,000

July 31, 2023

July 31, 2026

0.282%

300,000

July 31, 2023

July 31, 2026

0.232%

200,000

July 31, 2023

January 31, 2028

0.538%

600,000

July 31, 2023

July 31, 2028

0.645%

400,000

July 31, 2023

July 31, 2028

0.645%

500,000

July 31, 2023

July 31, 2029

0.720%

500,000

July 31, 2023

July 31, 2029

0.645%

500,000

26

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)August 7, 2023

July 31, 2026

0.282%

August 7, 2023

July 31, 2027

0.711%¥

200,000

200,000

August 7, 2023

January 31, 2028

0.726%

550,000

August 7, 2023

January 31, 2028

0.833%

300,000

August 7, 2023

July 31, 2030

1.184%

400,000
500,000

August 7, 2023

July 31, 2030

1.021%

August 31, 2023

February 28, 2026

0.257%

700,000

August 31, 2023

August 31, 2026

0.332%

1,200,000

August 31, 2023

August 31, 2026

0.282%

500,000

August 31, 2023

August 31, 2026

0.499%

2,000,000

August 31, 2023

August 31, 2026

0.257%

300,000

August 31, 2023

August 31, 2028

0.803%

900,000

August 31, 2023

August 31, 2028

0.753%

650,000

August 31, 2023

August 31, 2030

1.186%

1,000,000

September 29, 2023

September 30, 2028

0.331%

500,000

October 31, 2023

October 31, 2026

0.559%

1,000,000

October 31, 2023

October 31, 2028

0.257%

1,000,000

October 31, 2023

October 31, 2028

0.889%

1,000,000

October 31, 2023

October 31, 2028

0.839%

1,000,000

October 31, 2023

March 31, 2030

1.115%

1,500,000

November 1, 2023

October 31, 2026

0.578%

1,000,000

November 1, 2023

October 31, 2026

0.578%

900,000

November 1, 2023

October 31, 2026

0.207%

1,000,000

November 1, 2023

October 31, 2027

0.718%

1,000,000

November 1, 2023

October 31, 2027

0.718%

1,000,000

November 1, 2023

April 30, 2028

0.822%

1,000,000

November 1, 2023

April 30, 2028

0.822%

1,000,000

November 1, 2023

April 30, 2028

0.822%

1,000,000

November 1, 2023

October 31, 2028

0.854%

1,000,000

November 1, 2023

October 31, 2028

0.854%

500,000

November 1, 2023

October 31, 2028

0.904%

1,200,000

November 1, 2023

October 31, 2028

0.307%

1,000,000

November 1, 2023

October 31, 2028

0.257%

1,000,000

November 30, 2023

October 31, 2026

0.511%

300,000

November 30, 2023

October 31, 2030

0.432%

1,800,000

January 31, 2024

October 31, 2027

0.610%

1,200,000

January 31, 2024

October 31, 2027

0.610%

900,000

January 31, 2024

October 31, 2028

0.804%

750,000

January 31, 2024

January 31, 2029

0.839%

1,000,000

January 31, 2024

January 31, 2029

0.839%

600,000

January 31, 2024

January 31, 2029

0.839%

500,000

January 31, 2024

April 30, 2029

0.873%

1,000,000

January 31, 2024

January 31, 2031

1.021%

1,000,000

January 31, 2024

January 31, 2031

1.021%

500,000

February 1, 2024

April 30, 2028

0.721%

4,000,000

February 1, 2024

April 30, 2028

0.721%

2,000,000

February 1, 2024

October 31, 2029

0.882%

5,000,000

February 1, 2024

January 31, 2031

1.013%

5,000,000

February 1, 2024

January 31, 2031

1.013%

1,000,000

February 15, 2024

October 31, 2029

0.868%

2,000,000

February 29, 2024

April 30, 2027

0.544%

2,500,000

February 29, 2024

April 30, 2029

0.874%

2,700,000

February 29, 2024

April 30, 2029

0.874%

1,000,000

27

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)February 29, 2024

October 31, 2029

0.863%

February 29, 2024

October 31, 2029

0.863%¥

600,000

March 25, 2024

October 31, 2029

0.866%

2,000,000

March 25, 2024

April 30, 2030

0.380%

3,000,000

March 29, 2024

April 30, 2029

0.934%

1,000,000

March 29, 2024

October 31, 2030

0.970%

1,400,000

April 30, 2024

October 31, 2026

0.293%

500,000

April 30, 2024

October 31, 2026

0.293%

450,000

April 30, 2024

April 30, 2028

0.368%

1,000,000

April 30, 2024

April 30, 2029

0.418%

2,000,000

April 30, 2024

April 30, 2029

0.853%

1,000,000

April 30, 2024

October 31, 2030

0.350%

1,100,000

April 30, 2024

April 30, 2031

1.136%

4,600,000

April 30, 2024

April 30, 2031

1.136%

2,000,000

April 30, 2024

April 30, 2031

1.136%

1,000,000
447,460,000

Subtotal
Current portion of investment corporation
bonds

July 25, 2014

July 25, 2024

1.180%

January 30, 2020

January 30, 2025

0.250%

2,000,000

April 30, 2020

April 30, 2025

0.400%㻌 㻌 㻌 㻌 㻌 㻌 1,000,000

April 28, 2016

April 28, 2028

0.900%¥

August 30, 2016

August 28, 2026

0.540%

1,000,000¥

Subtotal
Total

2,000,000

5,000,000

Subtotal
Investment corporation bonds

1,500,000

1,000,000

August 30, 2016

August 30, 2028

0.800%

1,000,000

October 31, 2016

October 30, 2026

0.600%

1,000,000

July 19, 2017

July 16, 2027

0.640%

2,000,000

August 31, 2017

August 31, 2027

0.700%

2,000,000

April 26, 2018

April 26, 2028

0.700%

2,000,000

November 30, 2018

November 30, 2028

0.850%

1,000,000

December 20, 2019

December 20, 2029

0.750%

2,000,000

October 20, 2020

October 18, 2030

0.610%

1,000,000

May 31, 2021

May 30, 2031

0.720%

1,700,000

July 28, 2021

July 31, 2026

0.180%

2,000,000

January 28, 2022

January 28, 2032

0.460%

2,000,000

June 22, 2022

October 29, 2027

0.500%

2,000,000

July 11, 2022

July 9, 2027

0.400%

1,000,000
22,700,000¥ 㻌 㻌 543,070,000

28The following summarizes short-term loans payable, long-term loans payable and investment corporation bonds outstanding as of
October 31, 2023:
Classification
Short-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)August 31, 2023

November 1, 2023

0.231%

October 31, 2023

October 31, 2024

0.181%

January 29, 2021

January 31, 2024

0.287%¥㻌 㻌 㻌

1,000,000
2,000,000

Subtotal
Current portion of long-term loans payable¥

1,000,000

February 18, 2015

February 29, 2024

1.157%

September 21, 2021

February 29, 2024

0.300%

1,700,000
1,000,000

September 21, 2017

March 31, 2024

0.555%

1,000,000

April 28, 2016

April 30, 2024

0.654%

㻌 2,000,000

April 28, 2022

April 30, 2024

0.272%

1,000,000

April 28, 2022

April 30, 2024

0.230%

2,500,000

June 30, 2022

June 30, 2024

0.274%

2,000,000

June 30, 2022

June 30, 2024

0.274%

1,000,000

August 31, 2022

August 31, 2024

0.350%

1,600,000

September 30, 2015

September 30, 2024

1.065%

2,000,000

October 31, 2014

October 31, 2024

1.257%

2,000,000

October 31, 2014

October 31, 2024

1.259%

1,000,000

October 30, 2015

October 31, 2024

0.989%

1,000,000

October 31, 2016

October 31, 2024

0.668%

1,000,000

November 30, 2021

October 31, 2024

0.289%

500,000

November 30, 2021

October 31, 2024

0.289%

500,000

November 30, 2021

October 31, 2024

0.289%

300,000

November 30, 2021

October 31, 2024

0.250%

2,500,000
25,600,000

SubtotalLong-term loans payable

1,000,000

January 30, 2015

January 31, 2025

1.161%

February 18, 2015

February 28, 2025

1.314%¥

1,500,000
1,250,000

February 27, 2015

February 28, 2025

1.153%

2,100,000

March 12, 2015

February 28, 2025

1.218%

1,000,000

March 31, 2015

March 31, 2025

1.266%

October 30, 2015

October 30, 2025

1.114%

2,500,000

October 30, 2015

October 30, 2025

1.114%

2,000,000

October 30, 2015

October 30, 2025

1.114%㻌 㻌 㻌 㻌 㻌 2,500,000

㻌㻌1,500,000

October 30, 2015

October 30, 2025

1.121%

2,500,000

November 12, 2015

November 30, 2025

1.173%

1,000,000

January 29, 2016

January 29, 2026

1.074%㻌 㻌 㻌 㻌 㻌 㻌 2,000,000

January 29, 2016

January 29, 2026

1.024%

1,800,000

February 18, 2016

February 18, 2026

0.998%

1,000,000

February 18, 2016

February 18, 2026

0.998%

500,000

March 31, 2016

March 31, 2026

0.898%

1,000,000

April 28, 2016

April 30, 2026

0.835%

2,000,000

April 28, 2016

April 30, 2026

0.865%

1,000,000

July 29, 2016

July 31, 2026

0.613%㻌 㻌 㻌 㻌 㻌 㻌 1,500,000
1,000,000

August 2, 2016

July 31, 2026

0.544%

October 31, 2016

October 31, 2026

0.876%

2,500,000

October 31, 2016

October 31, 2026

0.760%

1,000,000

October 31, 2016

October 31, 2026

0.734%

4,000,000

October 31, 2016

October 31, 2026

0.826%

1,500,000

December 12, 2016

November 30, 2026

0.982%

500,000

December 28, 2016

December 28, 2026

0.950%

1,500,000

29

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

January 16, 2017

January 31, 2027

0.860%

January 31, 2017

January 31, 2027

0.853%¥㻌 㻌 㻌 㻌 㻌 㻌 500,000
700,000

March 28, 2017

March 31, 2027

0.850%

500,000㻌 㻌 㻌 㻌 㻌 1,500,000

June 30, 2017

June 30, 2027

0.849%

August 10, 2017

July 28, 2027

0.800%

3,500,000

September 21, 2017

September 30, 2025

0.680%

1,500,000

September 21, 2017

March 31, 2027

0.732%

1,000,000

September 21, 2017

September 21, 2027

0.873%

1,000,000

September 21, 2017

September 30, 2027

0.851%

2,500,000

October 31, 2017

October 31, 2027

0.810%

2,500,000

November 13, 2017

November 13, 2027

0.931%

3,000,000

December 7, 2017

November 30, 2027

0.899%

1,400,000

December 7, 2017

November 30, 2027

0.820%

1,200,000

December 7, 2017

November 30, 2027

0.969%

1,000,000

December 7, 2017

November 30, 2027

0.939%

1,000,000

December 7, 2017

November 30, 2027

0.869%

1,000,000

December 7, 2017

November 30, 2027

0.899%

800,000

December 7, 2017

November 30, 2027

0.869%

600,000

December 28, 2017

December 28, 2025

0.744%

500,000

December 28, 2017

December 28, 2026

0.878%

500,000

December 28, 2017

December 28, 2027

0.864%

500,000

March 12, 2018

March 31, 2028

0.914%

1,500,000

March 26, 2018

March 31, 2027

0.808%

1,000,000

March 26, 2018

March 31, 2028

0.902%

1,000,000

July 31, 2018

July 31, 2028

0.988%

500,000

August 20, 2018

August 31, 2025

0.696%

500,000

August 20, 2018

August 31, 2028

1.003%

1,000,000

August 20, 2018

August 31, 2028

1.003%

1,000,000

August 20, 2018

August 31, 2028

1.003%

500,000

August 20, 2018

August 31, 2028

0.966%㻌 㻌 㻌 㻌 㻌 㻌 500,000

August 31, 2018

August 31, 2025

0.700%

500,000

August 31, 2018

August 31, 2025

0.723%

300,000

August 31, 2018

August 31, 2028

1.012%

700,000

October 31, 2018

October 31, 2028

1.013%

1,500,000

October 31, 2018

October 31, 2028

0.910%

1,000,000

October 31, 2018

October 31, 2028

1.013%

500,000

March 28, 2019

March 31, 2029

0.838%

1,400,000

March 29, 2019

March 31, 2029

0.839%

2,950,000

June 14, 2019

December 28, 2026

0.517%

500,000

June 14, 2019

April 30, 2027

0.605%

1,000,000

June 14, 2019

March 31, 2029

0.725%

1,000,000

July 31, 2019

April 30, 2027

0.554%

1,000,000

July 31, 2019

April 30, 2027

0.554%

1,000,000

September 30, 2019

September 30, 2026

0.489%

1,000,000

September 30, 2019

March 31, 2027

0.531%

900,000

September 30, 2019

March 31, 2027

0.425%

800,000

January 31, 2020

January 31, 2025

0.406%

700,000

January 31, 2020

January 31, 2027

0.526%

1,500,000

January 31, 2020

January 31, 2029

0.675%

1,500,000

March 12, 2020

February 28, 2026

0.361%

1,800,000

March 31, 2020

March 31, 2028

0.642%

1,000,000

30

Classification
Long-term loans payable

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)

June 30, 2020

June 30, 2028

0.646%

June 30, 2020

June 30, 2028

0.646%

June 30, 2020

June 30, 2028

0.646%

700,000

June 30, 2020

June 30, 2028

0.510%

2,000,000¥

2,000,000
2,000,000

July 31, 2020

July 31, 2028

0.636%

2,700,000

August 31, 2020

August 31, 2030

0.705%

1,500,000

September 30, 2020

September 30, 2025

0.396%

1,000,000

September 30, 2020

September 30, 2027

0.511%

1,000,000

September 30, 2020

September 30, 2030

0.738%

700,000

October 30, 2020

April 30, 2027

0.542%

1,400,000

October 30, 2020

October 31, 2030

0.803%

1,500,000

October 30, 2020

October 31, 2030

0.803%

300,000

November 12, 2020

April 30, 2027

0.552%

1,300,000

November 12, 2020

November 12, 2030

0.808%

700,000

November 12, 2020

November 12, 2030

0.808%

500,000

November 30, 2020

May 31, 2027

0.516%

200,000

November 30, 2020

November 30, 2030

0.763%

900,000

November 30, 2020

November 30, 2030

0.763%

800,000

November 30, 2020

November 30, 2030

0.763%

200,000

January 29, 2021

January 31, 2028

0.527%

1,200,000

January 29, 2021

January 31, 2030

0.678%

2,300,000

January 29, 2021

January 31, 2030

0.678%

2,000,000

January 29, 2021

January 31, 2030

0.678%

2,000,000

January 29, 2021

November 30, 2030

0.755%

800,000

July 12, 2021

June 30, 2028

0.484%

500,000

July 30, 2021

July 31, 2026

0.350%

1,000,000

November 30, 2021

April 30, 2026

0.300%

500,000

November 30, 2021

April 30, 2026

0.300%

500,000
500,000

November 30, 2021

April 30, 2026

0.300%

November 30, 2021

November 30, 2026

0.412%

500,000

November 30, 2021

November 30, 2026

0.412%

500,000

November 30, 2021

November 30, 2026

0.350%

500,000

November 30, 2021

November 30, 2026

0.384%

1,000,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.384%

500,000

November 30, 2021

November 30, 2026

0.325%

1,000,000

November 30, 2021

November 30, 2026

0.350%

1,000,000

November 30, 2021

November 30, 2028

0.511%

1,000,000

November 30, 2021

November 30, 2029

0.450%

500,000

April 28, 2022

April 30, 2025

0.302%

1,000,000

April 28, 2022

May 31, 2027

0.350%

June 30, 2022

June 30, 2025

0.200%

June 30, 2022

June 30, 2025

0.200%

June 30, 2022

June 30, 2025

0.200%

500,000

August 31, 2022

February 28, 2025

0.374%

1,600,000

1,000,000
㻌

2,000,000
1,000,000

August 31, 2022

August 31, 2025

0.395%

500,000

August 31, 2022

August 31, 2025

0.395%

1,000,000

August 31, 2022

August 31, 2025

0.395%

500,000

August 31, 2022

August 31, 2026

0.430%

2,700,000

August 31, 2022

August 31, 2027

0.501%

2,400,000

August 31, 2022

August 31, 2027

0.420%

1,000,000

August 31, 2022

August 31, 2027

0.350%

300,00031

Classification
Long-term loans payable

Subtotal
Current portion of investment corporation
bonds

Drawdown date

Last repayment date

Weighted-average

Balanceinterest rate

(In thousands of yen)August 31, 2022

August 31, 2029

0.685%

August 31, 2022

August 31, 2029

0.685%

1,950,000¥

1,000,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

500,000

August 31, 2022

August 31, 2029

0.685%

200,000
1,000,000

August 31, 2022

August 31, 2029

0.525%

August 31, 2022

August 31, 2029

0.525%

500,000

August 31, 2022

August 31, 2029

0.525%

1,000,000

August 31, 2022

August 31, 2029

0.525%

500,000

October 31, 2022

October 31, 2025

0.481%

500,000

October 31, 2022

April 30, 2026

0.373%

500,000

February 28, 2023

February 29, 2028

0.793%

1,000,000

March 13, 2023

March 31, 2030

1.050%

2,000,000

March 13, 2023

March 31, 2031

1.186%

1,800,000

June 30, 2023

June 30, 2026

0.248%

500,000

July 31, 2023

July 31, 2025

0.177%

1,000,000

July 31, 2023

July 31, 2029

0.645%

500,000

August 31, 2023

August 31, 2026

0.499%

2,000,000

August 31, 2023

August 31, 2026

0.231%

300,000

October 31, 2023

October 31, 2028

0.889%

1,000,000

October 31, 2023

October 31, 2028

0.839%

1,000,000

October 31, 2023

March 31, 2030

1.115%

1,500,000
174,350,000

February 15, 2019

February 15, 2024

0.390%¥

July 25, 2014

July 25, 2024

1.180%㻌 㻌 㻌 㻌 㻌 㻌 2,000,000

2,000,000

April 28, 2016

April 28, 2028

0.900%¥

July 19, 2017

July 16, 2027

0.640%

2,000,000

4,000,000

Subtotal
Investment corporation bonds

1,000,000

January 30, 2020

January 30, 2025

0.250%

2,000,000

October 20, 2020

October 18, 2030

0.610%

1,000,000

July 28, 2021

July 31, 2026

0.180%

2,000,000

July 11, 2022

July 9, 2027

0.400%

1,000,000
9,000,000

Subtotal¥ 㻌 㻌 214,950,000

Total

7. REDUCTION ENTRY
The amount of reduction entry of property, plant and equipment acquired by government subsidy is as follows:
As of April 30, 2024
As of October 31, 2023
In thousands of yen
Buildings in trust¥

26,230¥26,2308. COMMITMENT LINE AGREEMENTKDXR has concluded a commitment line agreement with bank of account, etc.
As of April 30, 2024

As of October 31, 2023

In thousands of yen
Maximum amount¥

9,000,000¥

9,000,000

32

Drawn credit facility–

Balance¥–

9,000,000¥

9,000,000

9. PER UNIT INFORMATION
From November 1, 2023
to April 30, 2024

From May 1, 2023
to October 31, 2023
Yen

Net asset value per unit¥

155,560¥

Net income per unit

¥

7,834

¥

Weighted-average number of units (units)

4,134,040

136,442
3,872
1,696,860*1: Net income per unit is calculated by dividing net income by the weighted average (based on number of days) number ofunits. Net income per unit after adjusting for diluted investment units is not included because there were no dilutive
investment units.
*2: KDXR implemented a 2-on-1 of split of investment units with October 31, 2023, as the record date of the split and November 1,
2023, as the effective date. Net assets per unit and net income per unit are calculated based on the assumption that the split was
implemented at the beginning of the prior fiscal period.

10. INCOME TAXESKDXR is subject to corporate income taxes at a regular statutory rate of approximately 31%. However, KDXR may deduct from its
taxable income amounts distributed to its unitholders, provided the requirements are met under the Special Taxation Measures Law
of Japan. Under this law, KDXR must meet a number of tax requirements, including a requirement that it currently distribute inexcess of 90% of its net income for the fiscal period in order to be able to deduct such amounts. If KDXR does not satisfy all of therequirements, the entire taxable income of KDXR will be subject to regular corporate income taxes. KDXR distributed in excess of
90% of its distributable income in the form of cash distributions totaling 16,019 million yen and 6,571 million yen for the periods
ended April 30, 2024, and October 31, 2023, respectively. Therefore, such distributions were treated as deductible distributions forpurposes of corporate income taxes. The effective tax rate on KDXR’s income was 0.00% and 0.02% for the fiscal periods endedApril 30, 2024, and October 31, 2023, respectively. The following table summarizes the significant differences between the statutory
tax rate and the effective tax rate.

From November 1, 2023
to April 30, 2024
31.46%

From May 1, 2023
to October 31, 2023
31.46%

Deductible cash distributions(15.56)(31.45)Gain on negative goodwill(16.84)

－

1.07

－

 (0.12)

 0.01

Statutory tax rate

Reversal of reserve for reduction entry
Others
Effective tax rate

0.00%

0.02%

㻌 The significant components of deferred tax assets and liabilities as of April 30, 2024, and October 31, 2023, are as follows:
As of April 30, 2024

As of October 31, 2023

In thousands of yen
Deferred tax assets
Enterprise tax payable¥

Amortization of leasehold right

－

¥

28

6,536

6,293

Deferred gains or losses on hedges

1,796

192

Asset retirement obligations

29,764－

Depreciation

3,038

－

20

－

OthersSubtotal
Valuation allowance
Total deferred tax assets

41,156

6,514(41,156)(6,485)

¥

¥

－

28

11. NET ASSETSKDXR issues only non-par value units in accordance with the Investment Trust Act. The entire amount of the issue price of new units33

is designated as stated capital. KDXR is required to maintain net assets of at least 50 million yen as required by the Investment Trust
Act.

Information on the cancellation of treasury investment units during the six-month period ended April 30, 2024, and October 31, 2023,
is as follows:
As of April 30, 2024
Total number of units cancelled (Number of units)
Total amount of cancellation (Thousands of yen)

As of October 31, 2023

67,883¥

4,295

12,999,432¥

2,999,551

12. RELATED-PARTY TRANSACTIONS(1) Parent Company, Major Corporate Unitholders and Other
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024) and Thirty-seventh fiscal period (From May 1, 2023 to
October 31, 2023)
Not applicable(2) Affiliated Companies and Other
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024) and Thirty-seventh fiscal period (From May 1, 2023 to
October 31, 2023)
Not applicable(3) Fellow Subsidiary Companies and Other
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024) and Thirty-seventh fiscal period (From May 1, 2023 to
October 31, 2023)
Not applicable(4) Directors, Major Individual Unitholders and Other
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024) and Thirty-seventh fiscal period (From May 1, 2023 to
October 31, 2023)
Not applicable

13. BREAKDOWN OF RENTAL AND OTHER OPERATING REVENUES, PROPERTY-RELATEDEXPENSES, AND GAIN AND LOSS ON SALE OF REAL ESTATE PROPERTY㻌㻌
Rent revenue - real estate, expenses related to rent business, and gain and loss on sale of real estate property for the fiscal
periods from November 1, 2023 to April 30, 2024 and from May 1, 2023 to October 31, 2023㻌 consist of the following:
From November 1, 2023

From May 1, 2023

to April 30, 2024

to October 31, 2023

In thousands of yen
Rental and other operating revenues
Rent revenue - real estate
Rental revenues
Common area charges
Subtotal¥ 30,528,637¥ 12,526,016

2,054,581

1,416,057

32,583,219

13,942,073

Others:Parking space rental revenues

953,613522,316

Utility charge reimbursement

1,938,894

1,315,987

Miscellaneous

1,120,539

280,554

Subtotal

4,013,047

2,118,858¥ 36,596,267¥ 16,060,932¥ 2,863,812¥ 1,494,166

Total rental and other operating revenues
Property-related expenses
Expenses related to rent business
Property management fees and facility management fees
Utilities

2,157,928

1,454,250

Taxes

2,951,506

1,478,415

34

Repairs and maintenance

918,379

491,706

Insurance

75,65021,057

Trust fees

118,389

30,127

Others859,642

334,964

4,851,057

2,574,098¥ 14,796,366¥ 7,878,787¥ 3,880,000¥ －2,337,383－

Depreciation
Total expenses related to rent business
Gain and loss on sale of real estate properties

Harajuku FF Building
Revenue from sale of investment properties
Cost of investment properties
Other sales expenses
Gain on sale of real estate properties

159,976－¥ 1,382,639¥ －¥ 6,050,000¥ －5,919,374－

KDX Nagoya Sakae Building
Revenue from sale of investment properties
Cost of investment properties
Other sales expenses
Gain on sale of real estate properties

18,640－¥ 111,985¥ －35

14. LEASESKDXR, as lessee, has entered into Fixed-term lease contract whereby fixed monthly rents are due in advance. The future minimum
rental expenses under existing non-cancelable operating leases as of April 30, 2024, and October 31, 2023, are as follows:
As of April 30, 2024

As of October 31, 2023
In thousands of yen

22,500619,673¥ 642,173

Due within one year

¥ －¥Due after one year
Total

－
¥ －

KDXR, as lessor, has entered into leases whose fixed monthly rents are due in advance with lease terms of generally two years foroffice buildings. The future minimum rental revenues under existing non-cancelable operating leases as of April 30, 2024, and October
31, 2023, are as follows:
As of April 30, 2024

As of October 31, 2023
In thousands of yen

Due within one year

¥ 19,296,514

Due after one year

78,588,110¥ 3,246,442
5,936,156

Total¥ 97,884,624¥ 9,182,599

15. FINANCIAL INSTRUMENTS
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024)(A) Overview(1) Policy for Financial Instruments
KDXR procures essential funds for acquiring properties and undertaking the repayment of loans primarily through bank loans andthe issuance of investment corporation bonds and new investment units. KDXR uses derivatives for the purpose of hedging its
exposure to changes in interest rates and does not enter into derivatives for speculative or trading purposes. Management of surplus
funds is undertaken in a prudent manner that considers fully such factors as safety, liquidity, interest-rate conditions and cash flows.
(2) Types of Financial Instruments and Related Risk
Investment securities, which are Japanese silent partnership (tokumei kumiai, “TK”) interests, are exposed to credit risk of the issuer
and risk of fluctuation of value of its property.
Loans payable and investment corporation bonds are used primarily for procuring funds necessary for the acquisition of properties
and have a redemption date of a maximum of approximately 7 years and 9 months following the accounting date. Although a certain
portion of said liabilities are subject to interest-rate fluctuation risk, KDXR utilizes derivatives (interest-rate swap transactions) inorder to reduce such risk.
Interest-rate swap transactions are used as derivative financial instruments. Utilizing interest-rate swap transactions, KDXR fixes its
interest expense for long-term loans payable bearing interest at a variable rate. With regard to hedge accounting methods, hedging
instruments and hedged items, hedge policy, and the assessment of the effectiveness of hedging activities, please see Note 2 (M)“Derivative Financial Instruments.”(3) Risk Management for Financial Instruments(a) Monitoring of market risk (the risks arising from fluctuations in interest rates and others)
KDXR uses interest-rate swap transactions in order to minimize risk arising from fluctuations in interest rates on funds procured.
KDXR periodically reviews the value of the property and financial condition of the issuer with regard to investment securities.
(b) Monitoring of liquidity risk (the risk that the Investment Corporation may not be able to meet its obligations on scheduled
due dates) associated with procurement of funds
Although loans and other liabilities are subject to liquidity risk, KDXR reduces such risk by spreading out payment due dates and byusing diversified fund procurement methods. Liquidity risk is also managed by such means as regularly checking the balance of cash
reserves.
(4) Supplementary Explanation of the Estimated Fair Value of Financial Instruments
Because the factors incorporated into the calculation of fair value of financial instruments are subject to change, differing assumptions
are adopted which may alter fair value. Moreover, the contract amounts, etc. of derivative transactions in “(B) Estimated Fair Value36

of Financial Instruments” do not indicate the market risk of derivative transactions.
(B) Estimated Fair Value of Financial Instruments
The carrying value of financial instruments on the balance sheet as of April 30, 2024 and estimated fair value are shown in the following
table. Moreover, because “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are settled with cash in
the short term, the fair value can be considered as equivalent to the book value. Therefore, the notes for these accounts have been
omitted.
Carrying value

Estimated fair value

Difference

In thousands of yen(1) Current portion of investment corporation bonds

5,000,000

4,997,100(2) Current portion of long-term loans payable

59,010,000

59,010,559

559(3) Investment corporation bonds

22,700,000

22,179,030(520,970)(4) Long-term loans payable
Subtotal(2,900)447,460,000

442,089,595(5,370,404)¥534,170,000¥528,276,284¥ (5,893,715)

3,376,722

3,376,722－

Derivative transactions(*)(*)The value of assets and liabilities arising from derivatives is shown at net value and with the amount in parentheses representing
the net liability position.
*1 Methods to determine the estimated fair value of financial instruments and other matters related to securities and derivativetransactions
Liabilities(1) Current portion of investment corporation bonds and (3) Investment corporation bonds
The fair value of investment corporation bonds is based on quoted market prices. The fair value of those for which no market priceis available is based on the quoted price obtained from counterparty financial institutions, etc.
(2) Current portion of long-term loans payable and (4) Long-term loans payable
The fair value of long-term loans payable is based on the present value of the total of principal and interest discounted by the interest
rate to be applied if similar new loans were entered into. The fair value of long-term loans payable bearing interest at a variable rate,
which is subject to fixed interest rates resulting from interest-rate swaps and special treatment applied to said swaps, is based on thepresent value of the total of principal and interest, which is handled together with the applicable interest-rate swaps, discounted by
the interest rate to be applied if similar loans were entered into.
Derivative Transactions
Please refer to Note 16 “DERIVATIVE TRANSACTIONS.”*2 Redemption schedule for loans payable and investment corporation bonds
Due within
1 year or lessDue after

Due after

1 year through2 years through2 years

3 years

Due after

Due after

3 years through 4 years through4 years

Due after
5 years

5 years

In thousands of yen
Investment corporationbonds
Long-term loans payable
Total¥ 5,000,000¥ －¥ 4,000,000¥ 10,000,000¥ 2,000,000¥ 6,700,000

59,010,000

80,660,000

95,890,000

93,290,000

83,320,000

94,300,000¥ 64,010,000¥ 80,660,000¥ 99,890,000¥ 103,290,000¥ 85,320,000¥ 101,000,000

Thirty-seventh fiscal period (From May 1, 2023 to October 31, 2023)(A) Overview(1) Policy for Financial Instruments
KDXR procures essential funds for acquiring properties and undertaking the repayment of loans primarily through bank loans andthe issuance of investment corporation bonds and new investment units.KDXR uses derivatives for the purpose of hedging its
exposure to changes in interest rates and does not enter into derivatives for speculative or trading purposes. Management of surplus
funds is undertaken in a prudent manner that considers fully such factors as safety, liquidity, interest-rate conditions and cash flows.
(2) Types of Financial Instruments and Related Risk

37

Investment securities, which are Japanese silent partnership (tokumei kumiai, “TK”) interests, are exposed to credit risk of the issuer
and risk of fluctuation of value of its property.
Loans payable and investment corporation bonds are used primarily for procuring funds necessary for the acquisition of properties
and have a redemption date of a maximum of approximately 7 years and 5 months following the accounting date. Although a certain
portion of said liabilities are subject to interest-rate fluctuation risk, KDXR utilizes derivatives (interest-rate swap transactions) inorder to reduce such risk.
Interest-rate swap transactions are used as derivative financial instruments. Utilizing interest-rate swap transactions, KDXR fixes its
interest expense for long-term loans payable bearing interest at a variable rate. With regard to hedge accounting methods, hedging
instruments and hedged items, hedge policy, and the assessment of the effectiveness of hedging activities, please see Note 2 (M)“Derivative Financial Instruments.”(3) Risk Management for Financial Instruments(a) Monitoring of market risk (the risks arising from fluctuations in interest rates and others)
KDXR uses interest-rate swap transactions in order to minimize risk arising from fluctuations in interest rates on funds procured.
KDXR periodically reviews the value of the property and financial condition of the issuer with regard to investment securities.
(b) Monitoring of liquidity risk (the risk that KDXR may not be able to meet its obligations on scheduled due dates) associatedwith procurement of funds
Although loans and other liabilities are subject to liquidity risk, KDXR reduces such risk by spreading out payment due dates and byusing diversified fund procurement methods. Liquidity risk is also managed by such means as regularly checking the balance of cash
reserves.
(4) Supplementary Explanation of the Estimated Fair Value of Financial Instruments
Because the factors incorporated into the calculation of fair value of financial instruments are subject to change, differing assumptions
are adopted which may alter fair value. Moreover, the contract amounts, etc. of derivative transactions in “(B) Estimated Fair Valueof Financial Instruments” do not indicate the market risk of derivative transactions.
(B) Estimated Fair Value of Financial Instruments
The carrying value of financial instruments on the balance sheet as of October 31, 2023 and estimated fair value are shown in thefollowing table. Moreover, because “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are settled withcash in the short term, the fair value can be considered as equivalent to the book value. Therefore, the notes for these accounts havebeen omitted.
Carrying value
Estimated fair value
Difference
In thousands of yen(1) Current portion of investment corporation bonds

4,000,000

4,010,000(2) Current portion of long-term loans payable

25,600,000

25,628,808

28,808(3) Investment corporation bonds

9,000,000

8,853,200(146,800)(4) Long-term loans payable
Subtotal
Derivative transactions(*)

10,000174,350,000

171,630,090(2,719,909)¥ 212,950,000¥ 210,122,098¥ (2,827,901)

1,632,131

1,632,131–(*) The value of assets and liabilities arising from derivatives is shown at net value and with the amount in parentheses representing
the net liability position.
*1 Methods to determine the estimated fair value of financial instruments and other matters related to securities and derivativetransactions
Liabilities(1) Current portion of investment corporation bonds and (3) Investment corporation bonds
The fair value of investment corporation bonds is based on quoted market prices. The fair value of those for which no market priceis available is based on the quoted price obtained from counterparty financial institutions, etc.
(2) Current portion of long-term loans payable and (4) Long-term loans payable
The fair value of long-term loans payable is based on the present value of the total of principal and interest discounted by the interest
rate to be applied if similar new loans were entered into. The fair value of long-term loans payable bearing interest at a variable rate,
which is subject to fixed interest rates resulting from interest-rate swaps and special treatment applied to said swaps, is based on thepresent value of the total of principal and interest, which is handled together with the applicable interest-rate swaps, discounted by
the interest rate to be applied if similar loans were entered into.

38

Derivative Transactions
Please refer to Note 16 “DERIVATIVE TRANSACTIONS.”

39

*2 Redemption schedule for loans payable and investment corporation bonds
Due within
1 year or lessDue after

Due after

Due after

1 year through2 years through2 years

3 years

Due after

Due after

3 years through 4 years through4 years

5 years

5 years

In thousands of yen
Investment corporation

4,000,000

bonds
Long-term loans payable
Total

2,000,000

25,600,000¥

29,600,000

2,000,000

30,950,000¥

32,950,000¥

3,000,000

33,600,000

38,500,000

35,600,000¥ 41,500,000

1,000,000

1,000,000

35,300,000¥

36,300,000

36,000,000¥

37,000,000

16. DERIVATIVE TRANSACTIONS
The following summarizes the contracted amount and the fair value of interest-rate swap contracts as of April 30, 2024:(1) Hedge accounting not applied
Not applicable(2) Hedge accounting applied
Hedge

Type ofaccounting

derivative

methodtransactions

Principle method Interest-rate

Contracted amount

Hedgeditems(In thousands of yen)
Maturing 㻌after 1 year

Fair value(In thousandsof yen)Long-termswaps:㻌

loans

Receive/floating

payableCalculation㻌
method㻌 forapplicable fair value
Based on the¥

243,930,000¥

218,410,000¥ 3,376,722

and pay/fixedamount provided bycounterparty
financial institutions

Special treatment Interest-rateLong-termof interest-rate

swaps:㻌

loans

swaps

Receive/floating

payable25,400,000

13,300,000¥ 269,330,000¥ 231,710,000*

and pay/fixed
Total¥ 3,376,722(*) Interest-rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As aresult, their fair value is included in the fair value of the hedged long-term loans payable.

The following summarizes the contracted amount and the fair value of interest-rate swap contracts as of October 31, 2023:(1) Hedge accounting not applied
Not applicable(2) Hedge accounting applied
Hedge

Type ofaccounting

derivative

methodtransactions

Principle method Interest-rate

Contracted amount

Hedgeditems(In thousands of yen)
Maturing 㻌after 1 year

Fair value(In thousandsof yen)Long-termswaps:㻌

loans

Receive/floating

payableCalculation㻌
method㻌 forapplicable fair value
Based on the¥79,950,000¥

75,050,000¥ 1,632,131

and pay/fixedamount provided bycounterparty
financial institutions

Special treatment Interest-rateLong-termof interest-rate

swaps:㻌

loans

swaps

Receive/floating

payable27,100,000

20,400,000*¥ 107,050,000¥ 95,450,000¥ 1,632,131

and pay/fixed
Total(*)Interest-rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As a40

result, their fair value is included in the fair value of the hedged long-term loans payable.

17. REVENUE RECOGNITION
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024)(1)

Information on the Breakdown of Revenue from Contracts with Customers
Thirty-eighth Fiscal Period (From November 1, 2023 to April 30, 2024)
Revenues generated from contracts

Sales to external customers

with customers*(In thousands of yen)
Revenue from sale of real

¥ 9,930,000

estate property¥ 1,494,624

1,938,894

1,938,894

Other

–

35,221,363

Total¥11,868,894¥38,654,882

Utility charge reimbursements(*) Rental revenues, etc. which are subject to Accounting Standard for Lease Transactions (ASBJ Statement No. 13) and the transfer
of real estate properties which is subject to the “Practical Guidelines on Accounting by Transferors for Securitization of Real
Estate Using Special Purpose Companies” (Accounting System Committee Report No.15 of the Japanese Institute of Certified
Public Accountants) are not included in the above amounts as they are excluded from revenue recognition accounting standards.
Furthermore, revenue generated from contracts with major customers include of revenue from sale of real estate properties andutility charge reimbursements.
(*) As proceeds from sale of real estate property are recorded as gain on sale of real estate property in the statements of income andretained earnings, the amount calculated by deducting the cost of real estate property sales and other sales expenses from proceedsfrom sale of real estate property is indicated.
(2)

Information Utilized as the Base for Understanding Revenue from Contracts with Customers
Thirty-seventh Fiscal Period (From May 1, 2023 to October 31, 2023)
The information is as described in the notes on Summary of Significant Accounting Policies.

(3)

Information on relationship of Fulfillment of performance Obligations based with customers with cashflow generated
from said contracts and Amount and period of Revenue expected to be recognized in the next calculation period or
thereafter from contracts existing at the end of the current calculation period.

(a) Balance of contract assets and contract liabilities, etc.
From November 1, 2023
to April 30, 2024
(in thousands of yen)
Receivables generated from contracts with customers(balance at beginning of fiscal period)
Receivables generated from contracts with customers(balance at end of fiscal period)¥329,871
487,458

Contract assets (balance at beginning of fiscal period)–

Contract assets (balance at end of fiscal period)–

Contract liabilities (balance at beginning of fiscal period)–

Contract liabilities (balance at end of fiscal period)–(b)Transaction value allocated to remaining performance obligations
With regard to utility charge reimbursements, as KDXR has the right to receive from customers an amount directly
corresponding to the value for the lessees, or customers, of sections for which performance is complete by the end of the
fiscal period, the amount it has the right to claim is recognized as revenue in accordance with Paragraph 19 of the
Implementation Guidance on Accounting Standard for Revenue Recognition. Accordingly, such is not included in the noteon transaction value allocated to remaining performance obligations through application of the provisions of Paragraph 80 -41

22 (2) of the Accounting Standard for Revenue Recognition.

Thirty-seventh fiscal period (From May 1, 2023 to October 31, 2023)(1)

Information on the Breakdown of Revenue from Contracts with Customers
Thirty-seventh Fiscal Period (From May 1, 2023 to October 31, 2023)
Revenues generated from contracts

Sales to external customers

with customers*(In thousands of yen)
Revenue from sale of real¥estate property

–

¥

–

1,315,987

1,315,987

Other

–

15,339,616

Total¥1,315,987¥16,655,603

Utility charge reimbursements(*)Rental revenues, etc. which are subject to Accounting Standard for Lease Transactions (ASBJ Statement No. 13) and the transfer
of real estate properties which is subject to the “Practical Guidelines on Accounting by Transferors for Securitization of Real
Estate Using Special Purpose Companies” (Accounting System Committee Report No.15 of the Japanese Institute of Certified
Public Accountants) are not included in the above amounts as they are excluded from revenue recognition accounting standards.
Furthermore, revenue generated from contracts with major customers include of revenue from sale of real estate properties andutility charge reimbursements.
(2)

Information Utilized as the Base for Understanding Revenue from Contracts with Customers
Thirty-seventh Fiscal Period (From May 1, 2023 to October 31, 2023)
The information is as described in the notes on Summary of Significant Accounting Policies.

(3)

Information on relationship of Fulfillment of performance Obligations based with customers with cashflow generated
from said contracts and Amount and period of Revenue expected to be recognized in the next calculation period or
thereafter from contracts existing at the end of the current calculation period .

(a) Balance of contract assets and contract liabilities, etc.
From May 1, 2023
to October 31, 2023
(In thousands of yen)
Receivables generated from contracts with customers(balance at beginning of fiscal period)
Receivables generated from contracts with customers(balance at end of fiscal period)¥309,606
329,871

Contract assets (balance at beginning of fiscal period)–

Contract assets (balance at end of fiscal period)–

Contract liabilities (balance at beginning of fiscal period)–

Contract liabilities (balance at end of fiscal period)–(b)Transaction value allocated to remaining performance obligations
As of October 31, 2023, the total transaction price allocated to remaining performance obligations for the sale of real estat e
is 9,930,000 thousand yen for the real estate for which a sale agreement was executed on June 13, 2023. KDXR expects torecognize revenue on the remaining performance obligation upon the sale on November 1, 2023.
With regard to utility charge reimbursements, as the Investment Corporation has the right to receive from customers anamount directly corresponding to the value for the lessees, or customers, of sections for which performance is complete by
the end of the fiscal period, the amount it has the right to claim is recognized as revenue in accordance with Paragraph 19 of
the Implementation Guidance on Accounting Standard for Revenue Recognition. Accordingly, such is not included in the42note on transaction value allocated to remaining performance obligations through application of the provisions of Paragraph80-22 (2) of the Accounting Standard for Revenue Recognition.

18. INVESTMENT AND RENTAL PROPERTIES
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024)
KDXR owns real estate for rental purposes mainly in the Tokyo metropolitan area for the purpose of generating rental revenues.
The carrying value in the balance sheets and corresponding fair value of those properties are as follows:
Carrying value (In thousands of yen)
As of October 30, 2023

Net change

Fair value
As of April 30, 2024
(In thousands of yen)
¥ 1,287,305,000

As of April 30, 2024

¥ 430,989,387¥730,072,984¥ 1,161,062,372*1: The carrying value represents the acquisition cost less accumulated depreciation.
*2: Fair value at the end of the fiscal period is the appraisal value determined by outside appraisers. Fair value at the end of the fiscal
period under review of KDX Nihonbashi 313 Building that was sold on June 28, 2024 is calculated based on the sale price (7,110
million yen) in the transaction agreements on June 18, 2024.
*3: Among changes in the amount of real estate for rental purposes that occurred during the fiscal period under review, principal
increase/decrease factor was the acquisitions of 1 real estate property and trust beneficiary interest in real estate of 6 properties
totaling 46,268,043 thousand yen, sale of 1 real estate property and trust beneficiary interest in real estate of 1 property totaling
8,256,758 thousand yen and depreciation amounting to 4,850,709 thousand yen..
Income and loss in the fiscal period ended April 30, 2024, for real estate for rental purposes is listed in Note 13 “BREAKDOWN OFRENTAL AND OTHER OPERATING REVENUES, PROPERTY-RELATED EXPENSES, AND GAIN AND LOSS ON SALE OF
REAL ESTATE PROPERTY.”
Thirty-seventh fiscal period (From May 1, 2023 to October 31, 2023)
KDXR owns real estate for rental purposes mainly in the Tokyo metropolitan area for the purpose of generating rental revenues.
The carrying value in the balance sheets and corresponding fair value of those properties are as follows:
Carrying value (In thousands of yen)
As of April 30, 2023

Net change

As of October 31, 2023

Fair value

As of October 31, 2023
(In thousands of yen)
¥ 551,696,000¥ 432,404,110¥(1,414,723)¥ 430,989,387*1: The carrying value represents the acquisition cost less accumulated depreciation.
*2: Fair value at the end of the fiscal period is the appraisal value determined by outside appraisers. Fair value at the end of the fiscal
period under review of Harajuku F.F. Building and KDX Nagoya Sakae Building that were sold on November 1, 2023,
respectively are calculated based on the sale price (Harajuku F.F. Building: 3,880 million yen; KDX Nagoya Sakae Building:
6,050 million yen) in the transaction agreements on June 13, 2023.
*3: Among changes in the amount of real estate for rental purposes that occurred during the fiscal period under review, principal
increase/decrease factor was the depreciation amounting to 2,574,098 thousand yen.
Income and loss in the fiscal period ended October 31, 2023, for real estate for rental purposes is listed in Note 13 “BREAKDOWNOF RENTAL AND OTHER OPERATING REVENUES, PROPERTY-RELATED EXPENSES, AND GAIN AND LOSS ON SALE
OF REAL ESTATE PROPERTY.”

19. SEGMENT AND RELATED INFORMATION
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024)(A) Segment Information
Disclosure is omitted because the real estate leasing business is KDXR’s sole business and it has no reportable segment㻌 subject todisclosure.
(B) Related Information(1)

Information about each product and service

Disclosure is omitted because net sales to external customers for a single product/service category account for over 90% of theoperating revenues on the statement of income and retained earnings.

43

(2)

Information about Each Geographic Area(a)

Net sales

Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues on the statementof income and retained earnings.
(b)

Property, plant and equipment

Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount ofproperty, plant and equipment on the balance sheet.
(3)

Information about Each Major Customer

Disclosure is omitted because net sales to a single external customer account for less than 10% of the operating revenues on thestatement of income and retained earnings.

Thirty-seventh fiscal period (From May 1, 2023 to October 31, 2023)(A) Segment Information
Disclosure is omitted because the real estate leasing business is KDXR’s sole business and it has no reportable segment subject todisclosure.
(B) Related Information(1)

Information about each product and service

Disclosure is omitted because net sales to external customers for a single product / service category account for over 90% of theoperating revenues on the statement of income and retained earnings.
(2)

Information about each geographic area(a)

Net sales

Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues on the statementof income and retained earnings.
(b)

Property, plant and equipment

Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount ofproperty, plant and equipment on the balance sheet.
(3)

Information about each major customer

Disclosure is omitted because net sales to a single external customer account for less than 10% of the operating revenues on thestatement of income and retained earnings.

20. Business Combination
Thirty-eighth fiscal period (From November 1, 2023 to April 30, 2024)
Business Combination through Acquisition
1． Overview of Business Combination（1） Name and Line of Business of Acquirees
Name of acquireeLine of business

KDR

Real estate investment trust

KRR

Real estate investment trust（2） Main Reasons for Business Combination
KDXR, KDR and KRR entered into the merger agreement on June 13, 2023, aiming for the following advantages,⚫

The improvement of liquidity by expanding asset size and increasing market capitalization leads to growth44

opportunities.
⚫

Diversified portfolio makes the profitability stabilized and leads to more opportunities for external growth.

⚫

The improvement of asset management efficiency and financial stability.

（3） Date of Business Combination
November 1, 2023
（4） Legal Framework of Business Combination
The business combination was an absorption-type merger with KDO as the surviving corporation and KDR/KRR weredissolved.
（5） Name of the Investment Corporation after Merger
KDX Realty Investment Corporation（6） Main Reasons for Decision to Acquire the Companies
KDXR was decided as the acquiring corporation after a comprehensive consideration of the size of the corporations (total
assets, profit, etc.), the unitholders’ relative ratio of voting rights, the composition of the Board of Directors, etc., andother factors based on the Accounting Standard for Business Combinations, etc.
2． Performance Period of Acquirees Included in the Statement of Income and Retained Earnings
Name of acquiree

Performance period

KDR

From November 1, 2023 to April 30, 2024

KRR

From November 1, 2023 to April 30, 2024

3．Acquisition Cost of Acquirees and the Breakdown
Name of acquiree

Acquisition cost

KDR

¥226,058,322 thousand

KRR¥159,437,199 thousand

Total¥385,495,522 thousand

4． Exchange Ratio, Method of Calculation and Number of Investment Units Delivered as Consideration for the Acquisition（1）Exchange Ratio of Investment Units
Name of acquiree

Exchange ratio

KDR

1.34

KRR

1.68

KDXR implemented a 2-to-1 split of investment units (“the Split of Investment Units”) on November 1, 2023 as the effective
date, for the purpose of providing at least one KDXR’s investment unit to all unitholders of KDR and KRR as of October
31, 2023 as the record date.
（2）Method of Calculation
KDXR appointed SMBC Nikko Securities Inc., KDR appointed Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. andKRR appointed Nomura Securities Co., Ltd. as financial advisors (hereinafter “FA”) respectively, and requested them tocalculate the merger ratio. Each calculated the merger ratio based on the market investment unit price analysis, comparable
investment corporation analysis and other valuation methods. As a result of a series of discussions and negotiations incomprehensive consideration of the calculation results and other factors, the exchange ratio above was deemed appropriate.

45

（3）Number of Investment Units Granted
Name of acquiree5.

Performance period

KDR

1,434,380 units

KRR

1,011,657 units

Item and Amount of Major Acquisition-Related Expenses
Asset management fee for the merger 2,900,000 thousand yen

6． Purchase Price Allocation（1）Amounts and Main Breakdown of Assets Accepted and Liabilities Taken from the Business Combination(In thousands of yen)
Current assets

39,952,935

Non-current assets

696,962,014

Total assets

736,914,950

Current liabilities

57,700,081

Non-current liabilities

276,380,738

Total Liabilities

334,080,819（2）Amount and Reason for Gain on Negative Goodwill
Amount of gain on negative goodwill
17,338,607 thousand yen
ReasonNegative goodwill represents the fair value for net assets of KDR and KRR acquired as of the business combination
date which exceeds the acquisition cost. The difference was recognized as the gain on negative goodwill.
Accounting treatment
Booked as extraordinary gain for the fiscal period ended April 30, 2024.
7． Estimated Impact on the Statement of Income and Retained Earnings for the Fiscal Period Under Review Assuming theBusiness Combination is Completed on the Start Date of the Operating Period
There is no impact since the business combination date matches the start date of the operating period
Thirty-seventh fiscal period (From May 1, 2023 to October 31, 2023)
Not applicable

21. SIGNIFICANT SUBSEQUENT EVENTS
Not applicable46

22. DISTRIBUTIONS

I. Retained earnings at the end of period

Thirty-eight fiscal period(From November 1, 2023 to April 30, 2024)

Thirty-seventh fiscal period(From May 1, 2023 to October 31, 2023)

(Yen)

(Yen)

¥ 32,387,814,858¥ 6,571,336,746

II. Voluntary reserve (reversal)
Reversal of reserve for reduction entry¥ 1,100,141,923

III. Total distributions¥ 16,019,446,443¥ 6,571,090,350

Distributions per unit

¥ 3,927¥ 7,745

Provision of reserve for reduction entry¥ 14,589,000,000¥ –Ⅴ. Retained earnings brought forward
to the next period¥ 2,879,510,338¥ 246,396

In accordance with the policy stipulated in Article
35 (1) of its Articles of Incorporation, KDXR
determines that the amount of distribution shallexceed the amount equivalent to 90% of its
distributable profit as stipulated in Article 67-15
of the Special Taxation Measures Act and shall be
up to the amount of its profits as the ceiling.
Following this policy, KDXR has decided to
distribute 16,019,446,443 yen, which is theamount deducted the provision of reserve fortemporarydifference
adjustments(14,589,000,000yen) and added reversal ofreserve for reduction entry (1,100,141,923yen).
In addition, KDXR decided not to distribute cash
in excess of distributable profit, stipulated in
Article 35 (2) of its Articles of Incorporation.

In accordance with the policy stipulated in Article
35 (1) of its Articles of Incorporation, KDXR
determines that the amount of distribution shallexceed the amount equivalent to 90% of its
distributable profit as stipulated in Article 67-15
of the Act on Special Measures Concerning
Taxation, and shall be up to the amount of its
profits as the ceiling. Following this policy,
KDXR has decided to distribute ¥6,571,090,350
the maximum integral multiple amount ofinvestment units issued and outstanding of
848,430 units, up to the amount of unappropriatedretained earnings for the fiscal period underreview.
In addition, KDXR decided not to distribute cash
in excess of distributable profit, stipulated in
Article 35 (2) of its Articles of Incorporation.

Ⅳ. Voluntary reserve (provision)

Method of calculating distribution
amount

47

Independent Auditor’s Report

The Board of Directors
KDX Realty Investment Corporation

The Audit of the Financial Statements
OpinionWe have audited the accompanying financial statements of KDX Realty Investment Corporation(the Company), which comprise the balance sheet as at April 30, 2024, and the statements ofincome and retained earnings, changes in net assets, cash distribution and cash flows for the sixmonth period then ended, and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, thefinancial position of the Company as at April 30, 2024, and its financial performance and its
cash flows for the six-month period then ended in accordance with accounting principles
generally accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of the Company inaccordance with the ethical requirements that are relevant to our audit of the financial statements inJapan, and we have fulfilled our other ethical responsibilities in accordance with theserequirements. We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Other Information
The other information comprises the information included in the Semi-annual Report that
contains audited financial statements, but does not include the financial statements and our
auditor’s report thereon. Management is responsible for preparation and disclosure of the otherinformation. The Supervisory Director is responsible for overseeing the Company’s reporting
process of the other information.
Our opinion on the financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.

48

Responsibilities of Management and Supervisory Director for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statementsin accordance with accounting principles generally accepted in Japan, and for such internal
control as management determines is necessary to enable the preparation of financial statementsthat are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s
ability to continue as a going concern and disclosing, as required by accounting principles
generally accepted in Japan, matters related to going concern.
The Supervisory Director is responsible for overseeing the Company’s financial reporting
process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:・ Identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis for our opinion.
・ Consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances for our risk assessments, while the purpose of the audit of
the financial statements is not expressing an opinion on the effectiveness of the Company’s
internal control.
・ Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
・ Conclude on the appropriateness of management’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor’s report to the related disclosures in the financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our auditor’s report. However, future events or conditions
may cause the Company to cease to continue as a going concern.
・ Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions andevents in a manner that achieves fair presentation in accordance with accounting principles
generally accepted in Japan.
We communicate with the Executive Director regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.

49

We also provide the Executive Director with a statement that we have complied with the ethicalrequirements regarding independence that are relevant to our audit of the financial statements inJapan, and to communicate with them all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, actions taken to eliminate threats or
safeguards applied to reduce threats to an acceptable level.

Fee-related Information
The fees for the audits of the financial statements of the Company and other services provided
by us and other EY member firms for the year ended April 30, 2024, are 29 million yen and 15
million yen, respectively.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company whichis required to be disclosed pursuant to the provisions of the Certified Public Accountants Act ofJapan.
Ernst & Young ShinNihon LLC
Tokyo, Japan
July 25, 2024

櫻井 均
Hitoshi Sakurai
Designated Engagement Partner
Certified Public Accountant

齋木 夏生
Natsuki Saiki
Designated Engagement Partner
Certified Public Accountant

50

IR Schedule
Fiscal period ended April
Nov. Dec. Jan. Feb. Mar. Apr.
Financial results
announcement

Fiscal period end

Fiscal period ended October
May

Jun.

Jul.

Financial results
announcement

Start of distribution payments
Asset management report publication

Aug. Sep. Oct.
Fiscal period end

Start of distribution payments
Asset management report publication

Unitholder Memorandum
Fiscal Period End

April 30 and October 31 of each year

General Meeting of Unitholders

Convened at least once every two years, in principle

Record Date for Establishment ofUnitholder Voting Rights

Prescribed in Article 16 of the Articles of Incorporation

Record Dates for Distribution Payments April 30 and October 31 (within three months from payment record dates)
Listing

Tokyo Stock Exchange (Securities code: 8972)

Newspaper for Public Announcements

Nihon Keizai Shimbun (Nikkei)

Unitholder Registry and Special Account Sumitomo Mitsui Trust Bank, Limited
Administrator
4-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo
Postal Address and Telephone Inquiries

Stock Transfer Agency Department Sumitomo Mitsui Trust Bank, Limited 8-4 Izumi 2-chome,
Suginami-ku, Tokyo Toll-free tel: 0120 782 031

Receipt of Distributions
During Receipt Period

Take your distribution receipt to the head or branch ofﬁces of Japan Post Bank Co., Ltd.
or post ofﬁces (bank agents).
Specify the receipt method on the back of the distribution receipt and mail it to theAfter Receipt Period

Stock Transfer Agency Division of Sumitomo Mitsui Trust Bank, Limited, or receive
distributions at a branch of the bank.
Distributions can be paid by remittances to bank or ordinary postal savings accounts.
If transfer designations or other procedures are preferred, you should contact theReceiving Future Distributions

brokerage with which you have an account, in principle. If you do not have a brokerage
account and have a special account, contact Sumitomo Mitsui Trust Bank, Limited, theinstitution for managing special accounts.
Under the Articles of Incorporation of Kenedix Realty Investment Corporation, you cannot

Exclusion

receive distributions after three years have elapsed from the commencement of distribution
payments, so please receive them as soon as possible.

51