Samty Residential Investment Corporation（Securities CODE：3459）

Financial Results for the 5 th Fiscal PeriodEnding January 2018

Contents
１. Features of Samty Residential Investment Corporation

P.3

２. Financial Overview for the 5 th Fiscal Period

P.9

３. Managing Results

P.12

４. Future Growth Strategy

P.25

５. Operating Results and Distribution Information

P.35

６. Appendix

P.41

１. Features of Samty Residential Investment Corporation

New Initiatives of Samty Residential Investment Corporation
Additional acquisition of new properties and third-party allotment
by Daiwa Securities Group Inc.

 Welcoming Daiwa Securities Group Inc. as the new sponsor and acquiring 33 newproperties by conducting capital increase through third-party allotment
33% transfer【Asset Management
Company】【Main sponsor】（注）
Samty Co., Ltd.(Note)

100%

67%

Samty AssetManagement Co., Ltd.

Subsidiary

33%

0%

【Sub sponsor】
Daiwa Securities Group
Inc. (Note)

Equity method affiliate

Asset management
Samty Residential
Investment Corporation

35% investment(equity method affiliate)

5% investment【Overview of Samty Co., Ltd.】
Establishment: 1982
Capital: 8.4 billion yen (as of the end of
November 2017)
Number of employees: (consolidated) 188(as of the end of November 2017)
Business: Real estate business, real estateleasing business, real estate planning anddesign, etc.

Newacquisition

33 properties(29.9 billion yen)【Overview of Daiwa Securities Group Inc.】
Establishment: 1943
Capital: 247.3 billion yen (as of the end of
December 2017)
Number of employees: (consolidated) 13,836(as of the end of March 2017)
Business: Holding, management and control ofshares of companies engaged in financial
instruments business, etc.

(Note) Samty Co., Ltd. and Daiwa Securities Group Inc. fall under a specified affiliated juridical person of the asset management company as set forth in Article
12-3 of the Cabinet Office Ordinance on Disclosure of Information, etc., on Regulated Securities (Law Number: Ordinance of the Ministry of Finance No. 22 of
1993; including subsequent revisions).

4

Investment Strategy of Samty Residential Investment Corporation
 Samty Residential Investment Corporation(“Samty Residential”) will invest in highquality residential assets suitable for respective regional conditions throughout
national cities with the sponsor support of the Samty Group(1) Features of Samty Residential
Samty Residential Investment Corporation aims to build a portfolio which pursues stability, growth potential and earningpotential by “investing primarily in residential properties in major regional cities,” “utilizing the Samty Group,” “receiving
various sponsor support” and “utilizing the functions and network of the sub sponsor.”

Investing primarily in residential properties in major regional cities
Stability

GrowthEarning Potential▶ Diversified investing in carefully
screened residential properties ofJapan▶ Expanding portfolio size throughcontinual new investments
primarily in major regional cities▶ Realizing large earnings
収益性
anticipated through investing in
carefully screened residential
properties in major regional cities

Support from the Samty Group
Properties developed by the Samty Group
Stable supply of the S-RESIDENCE series
Grant of exclusive negotiating rights
Stable supply of new developed properties

Listed on the First Section of
the Tokyo stock Exchange on
October 26, 2015

Wide-ranging support from the sponsor
Enhancing value through runninga unified brand
Provision of warehousing functions
Provision of human resources andmanagement/operating support
Provision of various information

Support from Daiwa
Securities Group
Utilization of functions andnetwork as a comprehensive
securities group
Provision of information
Supporting formation of abridge fund
Cooperation in securing staff(Note) “Samty Group” refers to Samty Co., Ltd., and its consolidated subsidiary companies (Ordinance on Terminology, Forms and Preparation Methods of Consolidated Financial
Statements (Ministry of Finance No. 28 of 1976. Including subsequent amendments.) Referred to as consolidated subsidiary company as stipulated by Article 2 (iii).) andspecial purpose companies which Samty Co., Ltd., invests in themselves, other than the consolidated subsidiary companies of Samty Co., Ltd., while excluding Samty
Residential.

5

Investment Strategy of Samty Residential Investment Corporation(2) Portfolio Development Policy
A. Investment policy by asset class Investing in accommodation facilities and otherfacilities, primarily in the residential asset class

Residential
properties(Note1)

 Focusing on investing in major regional cities
Investment areas

80% or more
20% or less

Focus on the Single andCompact type residences
Floor per unit of lessthan 30m2

Compact Type

Floor per unit ofbetween 30m2 and
60m2(Note1) “Residential properties“ represents the rental housing.
(Note2) “Operating facilities” represents the hotels and health care properties.

(Sapporo, Sendai, Nagoya, Kyoto, Osaka, Kobe,
Hiroshima and Fukuoka)
50% or more of all investments will be inproperties that are conveniently located nearbus terminals or railway stations linked withother major terminal stations.

50%
or moreAround70%

Other regional cities(Regional cities excluding
major regional cities)
20% or less of investments will be inresidential properties that can be anticipatedstable operation rental and income stability
because of their commutable location to core
office areas, medical facilities or national
universities located in the area.

GreaterTokyo area

Single Type

Investment ratio (Note3)

Major regional cities

Regional cities

Operatingfacilities(Note2)

Ｂ. Investment policy by geographical area

20%
or less

Tokyo, Kanagawa, Saitama,
Chiba
Around 30% of investments will be inresidential properties primarily located inresidential communities within a 10-minute
walk of the nearest railway station (or busstop) that is located along a line connected
to a terminal station.

Around30%(Note3) "Investment ratio" is based on the acquisition price (excluding acquisitionrelated expenses and taxes). The above investment ratios are future targets
and actual portfolio composition may vary.

6Portfolio Overview 1■Samty Residential has acquired 82 residential properties throughout Japan and successfully
composed more stable diversified portfolio concentrating in major regional cities
Hokkaido 5
photo

Kyoto 3
Hyogo 6

Tochigi 1

Hiroshima 2

Saitama 2

Fukudoka 6

Asset size
81.5 billion yen

Average building age
8.5 yearOccupancey rate
96.5％

Average appraisal
NOI yield 5.5％

Miyagi 4

Saga 2
Ibaraki 1
Chiba 5
Osaka 6
Mie 5
Kumamoto 3

Aichi 14

Oita 3

Shizuoka 1

Tokyo 6
Kanagawa 7

Area

No. ofproperties

No. ofrentable
units

Major
regional cities

42

3,270

Other
regional citis

20

1,602

Greater Tokyo
area

20

1,048

Total

82

5,920

(Note) The figures for number of properties, asset size and average building age are for the 82 properties owned as of March 1, 2018, including the 33
properties acquired on February 1 and March 1, 2018. Average appraisal NOI yield is calculated based on the figures of the appraisal report as of theend of January 2018 for the existing 49 properties and as of November 1, 2017 for the newly acquired 33 properties. Figures for occupancy rate as ofthe end of January 2018 are for the 49 properties owned as of the end of January 2018.

7

Portfolio Overview 2
Investment structure of owned properties
Investment ratio by geographical area
GreaterTokyo area
20.8%
Chugoku
2.1%

Family
type
11.3%

Kinki
25.8%

Ratio of
Kita Kanto
Regional citis
3.0%
Hokkaido
79.2%
4.8% Tohoku
Tokai
Other
Regional cities
23.1%

Ratio of average area per residential unit

Major
7.0%
20.9% Regional cities
Kyusyu56.1%
15.6%

Ratio by building age

Compacttype
38.9%

Ration of
single andcompact type
88.7%

Investment ratio by
information/acquisiton channel(Note2)15 years to lessthan 20 years
6.0%

Averagebuilding age
10 years to less
8.5 yearthan 15 years
44.7%

Singletype
49.9%

Less than
5 years
30.2%

5 years toless than 10
years
19.1%

Developed/Ownedby sponsor
42.0%

Warehousing
27.9%

Sponsor AM
47.9% 52.1%
Bridge(SPC)
4.5%

Third party
11.7%

Bridgee
(SPC)
12.5%

Third party
1.4%(Note1) The above ratios are calculated based on acquisition prices for 82 properties, including 33 properties newly owned February 1, 2018 and March 1, 2018.
(Note2) The outer ring indicates the ratio of acquisition channel of owned properties while the inner ring indicates that of information channel of owned properties.

8２. Financial Overview for the 5 th Fiscal Period

Summary of Income Statement for 5th Fiscal Period
Comparison of Forecast and Actual Result
Although revenues from rents including common area expenses and key money decreased, the actual
result was generally as expected with decreased real estate rental expenses due to the increase inrevenues from silent partnership distribution and decrease in repair expenses and leasing promotion
expenses.
(million yen)Vs. 4th fiscal period actual results
3rd Period
results(January 31,
2017)

Operating revenue was 1,834 million yen (-5 million yen

5th Period (January 31, 2018)

4th Period
results

Forecast(July 31, 2017)(As of Septemeber
14, 2017)

Vs. 3rd and Vs. 4th and from the previous fiscal period) due to the decrease in
5th results 5th results revenues from rents including common area expenses, key

Changefrom
Forecast

Results

Operating revenue

1,806

1,840

1,826

1,834

8

28

(out of which, real estate rental revenue)

1,805

1,840

1,814

1,817

2

11

Operating expenses

956

1,081

1,047

1,045

-2

88

(out of which, real estate rental expenses)

766

838

805

803

-2

37

money and renewal fees. On the other hand, operating
income was 789 million yen (+30 million yen from theprevious fiscal period) as a result of the decrease in operating-5 expenses due to the decrease in repair expenses, leasing
promotion expenses and general and administrative-23 expenses. However, non-operating expenses increased withpartial refinancing of existing borrowings and ordinary income-36 stood at 620 million yen (+5 million yen from the previous
fiscal period) and net income at 619 million yen (+6 million-35 yen from the previous fiscal period).

Operating income

849

759

778

789

11

-60

30

Non-operating income and loss

-243

-144

-163

-169

-5

74

-24

Ordinary income

606

614

615

620

5

14

Corporate tax, etc.

0

0

1

0

-1

0

605

613

614

619

5

14

2,138

2,169

2,170

2,191

21

53

Distribution in excess of earnings
per unit・・・②

507

501

500

484

-16

-23

Total distribution per unit ・・・① + ②

2,645

2,670

2,670

2,675

5

30

Management performance

Net income■Distributions(Note)
Distribution per unit
(Not including distribution
in excess of earnings)・・・①(Note1) Calculated with the number of investment units issued at 283,000 for 4th and 5th period.
(Note2) For more detaills, please refer to “Change in forecast actual forecast” on page 37.

Vs. 5th fiscal period forecast(+ indicates increase factors, – indicates decrease factors)）■ Increase in operating revenue+8 million yen
・Decrease in revenues from rents
5-6 million yen
including common area expenses
・Increase in other revenues from0
+11 million yen
rental business
6
・Increase in income from silent+5 million yen
partnership distribution(yen)+2 million yen■ Decrease in operating expenses
・ Decrease in leasing promotion+4 million yen
22
expenses・ Increase in restoration income-6 million yen■ Increase in non-operating income-5 million yen
and loss-17+2 million yen
・ Decrease in interest expenses
・ Increase in borrowing related expenses -7 million yen
5【Average occcupancy rate】
Forecast：95.5％
Actual：96.2％【Capital expenditures】【Payout ratio】

Forecast：68 million yen
Actual：62 million yen

Forecast：72.0％
Actual：71.8％

10

Summary of Income Statement for 5th Fiscal Period
Comparison of Forecasted Distribution with Actual Result
Comparison of forecast and actual results for 5 th fiscal period
Operating revenue factors

Operating expensed factors＋8 mn yen

+2 mn yen（+31 yen）（+7 yen）

Total
distribution
752 mn yen（2,670 yen）
Payout ratio
72.0%

Distribution
excess of
earnings
141 mn yen(500 yen)

Distribution
614 mn yen(2,170 yen)

Non-operating income andexpense factors-5 mn yen（-17 yen）

Total
distribution
Increase in
757 mn yen
non-operating（2,675yen）
expenses

Other expenses Other expenses

Decrease inrentalrevenues andcommon area
expenses
income-8 mn yen（-30 yen）

Renewal fee

Key money
income2 mn yen

Restration
income4 mn yen

Rentalcommon area
expenses
income6 mn yen

Other income
4 mn yen

Increase in
Otherincome＋11 mn yen（＋40 yen）
1 mn yen

Increase inDistributionofanonymous
partnership＋5 mn yen（＋20yen）

1 mn yen

1 mn yen

Leasingpromotion
expenses
4 mn yen

Restoration
expenses
6 mn yenRepairexpneses
2 mn yen

PM fee1 mn
yen

Decrease inreal estate
rentalexpenses+8 mn yen（＋31 yen）

Increase inreal estate
expenses-8 mn yen（-30 yen）

Interest
expenses
2 mn yen

Decrease indepreciationetc.
＋1 mn yen（＋6 yen）

Decrease innonoperating
expenses＋2 mn yen（＋9 yen）-7 mn yen（-27 yen）
Borrowing
relatedexpenses
7 mn yen

Payout ratio
71.8%
Distribution inexcess of
earnings
137 mn yen（484 yen）

Total
increase in
distribution＋5 mn yen(＋21 yen)

Distribution
620 mn yen(2,191 yen）

Increase/decrease in total distribution +5 mn yen (+21 yen)
5th period
forecast distribution(announced on September 14, 2017）(Note) The above figures are rounded down to the nearest whole number.

5th period
actual result11３. Managing Results

Management Summary Samty Residential will continue to aim for expansion of asset size by utilizing warehousing in cooperation

with the bridge fund and sponsor

External
Growth⇒Acquired new properties worth 29.9 billion yen (33 properties). Asset size expanded to 81.5 billion yen(82 properties) and stability increased with the progress in the dispersion of portfolio Samty Residential implemented appropriate management based on the property/location features of owned

Internal
Growthproperties to realize stable occupancy rates and rent unit prices.

 Samty Residential promoted to materialize potential earning capabilities of properties through various

measures including enhancement of usability and reduction of costs.

 Samty Residential acquired DBJ Green Building certification as part of its environmental and social efforts.
 Samty Residential intends to diversify its fund procurement methods by conducting capital increase throughFinancial
Strategy

third-party allotment with Samty Co., Ltd. and Daiwa Securities Group Inc. as the allottees and issuinginvestment corporation bonds.

 Samty Residential conducted partial refinancing of long-term loans (2,500 million yen) and early repaymentof short-term loans (200 million yen)

 Samty Residential developed a solid financial base by diversifying repayment dates of and fixing the interest

rates of interest-bearing liabilities, etc.

Portfolio highlights

After the capital increase

End of 1st period

End of 2nd period

End of 3rd period

End of 4th period

End of 5th period(January 31, 2016)(July 31, 2016)(January 31, 2017)(July 31, 2017)(January 31, 2018)

through third-party
allotment(after purchased 33 properties)

No. of properties

29 properties

29 properties

49 properties

49 properties

49 properties

82 properties

Total acquisition price

30,962 million yen

30,962 million yen

51,551 million yen

51,551 million yen

51,551 million yen

81,515 million yen

Appraisal value

32,434 million yen

32,975 million yen

55,693 million yen

56,490 million yen

56,658 million yen

87,626 million yen

Appraisal NOI yield

5.6%

5.6%

5.6%

5.6%

5.6%

5.5%

NAV per unit (Note1)

96,983 yen

101,151 yen

97,779 yen

101,449 yen

102,854 yen

94,954 yen

7.6 year

8.1 year

7.9年

8.4 year

8.9 year

8.5 year

95.2%

95.4%

97.5%

95.6%

96.5%

2,345 units

2,345 units

3,754 units

3,754 units

3,754 units

Average building age
Occupancy rate
No. of rentable units

96.2%(Note2)5,920 units(Note 1) Calculated by: Unitholdersʼ capital + Unrealized gain/loss (Appraisal value – Book value) / Number of investment units issued(Note 2) Occupancy rate after the capital increase through third-party allotment is based on the figures as of the end of January 2018 for the existing 49 properties and the figures as of the endof October 2017 for the 33 properties newly acquired on February 1 and March 1, 2018. It is assumed that the fixed rent master lease agreement concluded with J.S.B. Co., Ltd. andSamty Residential Investment Corporation on February 1, 2018 for S-FORT Oita Otemachi and the lease agreement concluded with Mininet, Inc. and Samty Co., Ltd. on March 1, 2018
for S-FORT Osu Kannon existed as of the end of October 2017.

13

Internal Growth

Changes in the Occupancy Rates by Area
Occupancy rate for the entire portfolio has risen 3.7 point from the time of
IPO. Currently it stably keeps over 96%.

Began managementwith 28 properties
On July 1, 2015

Average occupancy rate：93.8％

Average occupancy rate：95.3％

Average occupancy rate：96.5％

Average occupancy rate：96.4％

Average occupancy rate：96.2％

1st Fiscal Period(January 31, 2016)

2nd Fiscal Period(July 31, 2016)

3rd Fiscal Period(January 31, 2017)

4th Fiscal Period(July 31, 2017)

5th Fiscal Period(January 31, 2018)

1st Fiscal Period

Occupancy rate(%)

(January 31,
2016)30-Jun31-Jan2nd Fiscal Period(July 31, 2016)
31-Jul

3rd Fiscal Period(January 31,

4th Fiscal Period (July 31, 2017)

5th Fiscal Period (January 31, 2018)2017)
31-Jan28-Feb31-Mar30-Apr31-May30-Jun31-Jul31-Aug30-Sep31-Oct30-Nov

31-Dec31-JanMajor regional cities

92.7

95.6

95.3

97.8

97.7

98.0

96.1

95.0

94.4

95.2

95.1

95.8

95.5

95.5

96.1

96.3

Other regional cities

93.8

95.3

95.2

96.9

96.3

97.6

97.2

96.6

96.4

95.8

96.2

97.0

97.5

97.5

97.3

97.0

Greater Tokyo area

92.5

93.5

96.2

96.7

96.6

98.4

98.4

97.6

97.6

97.8

97.7

97.9

97.4

97.2

97.5

96.4

Overall

92.8

95.2

95.4

97.5

97.3

98.0

96.6

95.6

95.1

95.6

95.6

96.2

96.1

96.0

96.5

96.5

(Note) Occupancy rates shows the ratio of total leased floor space to total rentable floor space as of each month end for each property, rounded off to one decimal place.
Occupancy rates from end of April 2015 to end of August 2015 excluding recently completed S-FORT Tsurumai marks and S-FORT Shonan Hiratsuka as well as S-FORT Gakuenmae which was
acquired on October 1, 2015.
The Occupancy rate for end of September 2015 includes S-FORT Tsurumai marks and S-FORT Shonan Hiratsuka, but excludes S-FORT Gakuenmae which had not been acquired.
The occupancy rate for end of July does not include the 20 properties acquired in August 2016.
The occupancy rate for end of August 2016 excludes recently completed S-FORT Tsurumai cube.

14

Internal Growth

Changes in unit rent after adjustment
Unit rent after adjustment of the entire portfolio remained stable,
maintaining earning potential of the portfolio

Began managementwith 28 properties
On July 1, 2015

2nd Fiscal Period(July 31, 2016)

1st Fiscal Period(January 31, 2016)

Rent unit price after
adjustment
End of June 2015 =100

1st Fiscal Period(January 31,
2016)

2nd Fiscal Period(July 31, 2016)

3rd Fiscal Period(January 31,
2017)

3rd Fiscal Period(January 31, 2017)

5th Fiscal Period(January 31, 2018)

4th Fiscal Period(July 31, 2017)

4th Fiscal Period (July 31, 2017)

5th Fiscal Period (January 31, 2018)

30-Jun31-Jan31-Jul

31-Jan28-Feb31-Mar30-Apr31-May30-Jun31-Jul31-Aug30-Sep31-Oct30-Nov

31-Dec31-JanMajor regional cities

100.0

100.2

100.5

100.6

100.6

100.7

100.7

100.8

100.9

101.0

101.0

101.1

101.1

101.2

101.2

101.2

Other regional cities

100.0

100.0

100.2

100.5

100.6

100.7

100.8

100.8

100.9

101.0

101.0

101.1

101.1

101.1

101.2

101.2

Greater Tokyo area

100.0

100.1

100.4

100.4

100.4

100.6

100.6

100.6

100.7

100.7

100.7

100.8

100.9

100.9

100.9

100.9

Overall

100.0

100.1

100.5

100.5

100.6

100.7

100.7

100.8

100.9

100.9

101.0

101.1

101.1

101.1

101.2

101.2

(Note) Unit rent after adjustment is calculated using the following formula with the assumed contract period of 4 years.
Unit rent after adjustment = {Monthly rent revenue + (Key money revenue ÷ Assumed contract period)} ÷ Contracted area
Unit rent after adjustment for each area was calculated through simple averaging of unit rent after adjustment of each property in accordance with the numberof properties in the relevant area in the past presentation materials. However, starting in the current fiscal period, such is calculated through weighted
averaging of unit rent after adjustment of each property in accordance with the contracted area ratio of each property in the relevant area.

15

Internal Growth

Increase or Decrease of Unit Rent after adjustment at the time of
Tenant Replacement
The ratio of increase of unit rent after adjustment
at the time of tenant replacement is 51.9%■ Increase or decrease of unit rent after adjustment
at the time of tenant repacement (Note)(No. of units / Composition ratio)

500

Increase exceeding 5%
Unchanged
Decrease exceeding 5%

Increaes of 5% or lessDecrease of 5% or lessTotal 465 units
30 units

400

300

Total 324 units
23 units

105 units

55 unitsthTotal 387 units 【4 fiscal period】【5th fiscal period】

34 units
101 units

75 units
200

100

38 units

176 units
132 units

137 units(0 units/+5.9%)

Unchanged
51 units/13.2%(-4 units/+1.4%)

Increase
201 units/51.9%(-74 units/-7.2%)

51 units
051 units

Decrease
135 units/34.9%

99 units

69 units

3rd fiscal period
4th fiscal period
5th fiscal period(As of January 31,(As of July 31, 2017)(As of January 31,
2017)
2018)
(Note) Unit rent after adjustment is calculated using the following formula with the assumed contract
period of 4 years.
Unit rent after adjustment = {Monthly rent revenue + (Key money revenue ÷ Assumed contract period)}÷ Contracted area

4th fiscal period to 5th fiscal period[Increase factors]

 Number of tenant replacements decreased fromthe 4th fiscal period as the peak season ended
 Worked to increase rents by expanding
furniture/home appliances rentals and freeinternet service
 Continue to promote the acquisition of key
money upon replacement as part of sales
strategy

5th fiscal period[Breakdown of increased cases/total numberof increased cases](1) Increase due to negotiation
46 cases(2) Increase due to installation of furniture/home
appliances
10 cases(3) Increase due to acquiring more
key money than the previous tenant
87 cases(4) Increase due to elimination ofrent gap
7 cases(5) Other(internet service, capital investment, etc.)
59 cases

3rd fiscal period to 5th fiscal period[Decrease factors](1) Decrease due to elimination ofrent gap
97 cases(2) Decrease dut to not receiving
key money
79 cases(unit rent, excluding key money has risen
as for 22 properties)

16

Internal Growth

Change in Renewal Status/Collection of Key Money of
Owned Properties

Renewal rate remained at a high level of around 90%

No. of renewals■ Change in the number of renewals and renewal rates
1,100 units

95.0%

94.3%

526 units

500 units

91.2%

657 units

89.3%

700 units

92.2%

913 units

92.0%

900 units

Renewal rates

646 units

90.0%

493 units
85.0%

300 units
80.0%

100 units(Thousandyen)

1st Fiscal Period

2nd Fiscal Period

3rd Fiscal Period

4th Fiscal Period

5th Fiscal Period(January 31, 2016)(July 31, 2016)(January 31, 2017)(July 31, 2017)(January 31, 2018)■ Change in the number of renewal fee collections
and the amounts collected

14,000223 units

10,00092 units

8,000(17.5%)

6,000

6,982
(75）

4,000
2,000
0

12,253（54）

112 units

6,471
（57）

154 units(23.8%)

9,882
（64）

(22.7%)■ Change in the number of key money collections
and the amounts collected

30,000(24.4%)

12,000(Thousandyen)

99 units(15.1%)

4,178
（42）

1st Fiscal Period
2nd Fiscal Period
3rd Fiscal Period
4th Fiscal Period
5th Fiscal Period(January 31, 2016) (July 31, 2016) (January 31, 2017) (July 31, 2017) (January 31, 2018)

269
units

25,00020,00015,00010,000
5,000
0

183
units
133
units

15,451
（84）

186
units
17,510(94）

24,213
（90）

148
units
14,484(97)

12,520（94）

1st Fiscal Period 2nd Fiscal Period 3rd Fiscal Period 4th Fiscal Period 5th Fiscal Period(January 31, 2016) (July 31, 2016) (January 31, 2017) (July 31, 2017) (January 31, 2018)17

Internal Growth

Future measures for internal growth
Current status and measures of properties with low occupancy
Property
name

S-FORT
Shin
Osaka
ravir
S-FORT
Shizuoka
Hondori
S-FORT
Tsurumaicube
S-FORT
Nakajima
Koen
S-FORT
Kurumamichi

Occupancy
rate as ofthe end ofJanuary

89.8%

85.7%

89.0%

85.6%

79.8%

Occupancy
rate as ofthe end of
February

Cause of low occupancy

87.8%-Excessive supply of new properties in the ShinOsaka area
-Having the same rent level and building age asother new properties-Undergoing complicated procedures (viewings,
acceptance of application, examination, cancellation
procedures, etc.) between the former PM company
and brokerage company

85.7%-Undergoing complicated procedures (viewings,
acceptance of application, examination, cancellation
procedures, etc.) between the former PM company
and former local sab PM company

86.2%-Delay in lease up of vacancy due to limited demand
for two vacant rooms with three bedrooms(equivalent to 80 m2 with occupancy rate of 5.49%)

86.6%-Increase in the number of cancellations in August
2017 and onward and delay in lease up of vacancies
in family-type units accounting for half of theproperties whose lease contracts were cancelled

84.7%-Simultaneous cancellation of a four-bedroom
residence owned by the previous owner of theproperty on the top floor (equivalent to 124 m2 withoccupancy rate of 10.29%) and other units

Target ofoccupancy
rate

Improvement measures

Schedule forachieving
goal

92.0%

-Increasing name recognition of theproperty by holding a viewing event andUntil theinforming the change of PM company
endof April-Appealing the efficiency and improvementof various procedures, etc. to brokers

92.9%-Applealing the efficiency, improvement ofvarious procedures etc. and the cooporation Until the
between PM company and local sub PM
end of May
company to brokers.

94.4%-Contacting luxury rental apartment
brokers and professional vendors ofmultinational tenants-Utilizing various media such as publishingproperty information on magazines forforeigners

Until theend of April

93.5%-Taking in relocation needs of neighboring
residents through posting, etc.
-Conducting a campaign limited to brokers
with records of recently concluding
contracts with customers

Until theend of April

97.1%-Renovating vacant units on the top floor
Until the→Changing to a Japanese modern taste
by removing the wall and adopting Ryukyu end of April
tatami(Note) PM company refers to property management company (management company of properties)

Target of future initiatives on newly acquired properties■Capital investment intending to enhance usability ⇒Installation of delivery box and enhancement of security■Investment for enhancing the value of properties ⇒Installation of free internet facility and concept room
■Investment for saving costs and energy ⇒Adopting LED lighting, introduction of electronic breaker and change of electricity company

18

Internal Growth

Initiatives by Samty Residential
Initiatives for increasing earnings■Increased the number of car sharing space and bikeparking space and introduced coin-operated parking lots

■Proposed ideas for the interior in line with thecharacteristics of each property using furniture frommajor furniture brands and set up model units

Expanding services for tenants by introducing
car sharing at properties in central Tokyo andproperties with many tenants who do not own
cars such as those in their 20ʼs or 30ʼs.
Enhancing profitability by changing monthly
parking lots with low occupancy to coinoperated parking lots.

Major furnitureand interior
brands in Japanand abroad

Occupancy rate andvacancy period after
the move-out oftenants improved
significantly

Initiatives for cost reduction
Reducing utilities expenses by introducing
LED lighting
Reducing utilities expenses by changing
electricity and gas suppliers and reviewing
contract details of water services
Reducing management expenses byreviewing the contract concluded with BM(building management company)
Reducing the amount of fuel usage byintroducing snow-melting system■Reinforced competitiveness byrenovating kitchen facilities■Renovated modular bathrooms

Initiatives for enhancing usability■Installation of delivery boxes
Aiming to introduce delivery
boxes at all buildings. Intending
to sequentially replace dial-key
delivery boxes with electronickey delivery boxes■Installation of security camera
and intercom

Aiming to introduce security cameras at allbuildings like delivery boxes.
Introducing remote monitoring systemusing PC/mobile phones at some properties

Status of installation (existing 49properties)
Delivery box

SecuritycameraIntercom48
properties

48
properties

49
properties

19

Internal Growth

Measures for increasing usability and earnings of tenants
Provision of safe, secure and comfortable living environment to tenants, renovation for
the enhancement of property value and setting up of model units
A-21 S-FORT Kamiotai■Renovation of living room and setting
100.0％

82.5％

Implementation ofrenovation work

Aiming to unify the specifications of each livingroom by considering and implementing renovationplans for each living room Renovation of bathroom (exchanging
bathtub and adding reheating functions) Renovation of closet in living room
 Installation of toilet seat with bidet
functions, etc.
■Setting up model units
in some living rooms after
renovation. Intends toenhance leasing capability■Renovation of entrance approach, installation of gate at parking lot
and relocation of parking lot and bicycle parking area
After

Before

Reviewing the foottraffic of tenants bycreating an entrance
approach■Renovation of the garbage
disposal area
Preventing illegal dumping of
garbage by non-residents inaddition to the improvement ofsense of beauty through renovation
BeforeAfter

Renovated the gate
door to prevent theentry of outsiders.
Improved the sense of
beauty by establishinga flowerbed

AfterIntending toenhancesecurity byrenovating theaged gate

20

Internal Growth

Measures for increasing usability and earnings of tenants
and reducing costs
Leasing plan and cost reduction through the proposal of residential space compatible withvarious needs of tenants
C-07 S-FORT Nishifunabashi■Setting up rooms in accordance with the recent lifestyle
Intending to attract tenants
wishing to live together with petsby installing a facility for cats

■Introduction of Sonyʼs multifunctional lighting
Providing a more comfortable residential
environment by introducing devices withfunctions friendly to both residents and pets
【Linkage of wireless LAN and smartphone】
 Adjusting the temperature and humidityof air conditioner and controlling the lightand TV from the living room and outside
the house Playing uploaded music in smartphones
with a built-in speaker Timer function of home appliances, etc.

■Introducing and installing vending

machines with a logo of Samty Residential
at several properties

Aiming to enhance name recognition of Samty
Residential and the property by advertising toresidents and neighbors■Intending to collaborate within Samty
Group when conducting large-scalerenovagtion for S-FORT Maihama
Conducting optimum  Regularly conducting
renovation of the common
renovation for each
property in cooperation areas to maintain a safe
and secure residential
with Samty Property
environment for residents
Management Co., Ltd.
Also becomes possible togain an advantage overother companies in costs

21

Financial Strategy

Financial highlight
Change in Financial status
End of 1st
periodEnd of 2nd
periodAfter 1stPO

End of 3rd
periodEnd of 4th
periodEnd of 5th
periodMost recent
date(January 31, 2016)(July 31, 2016)（August 2, 2017)17.1
billion yen

17.0
billion yen

29.2
billion yen

28.7
billion yen

28.6
billion yen

28.4
billion yen

44.8
billion yen

Average remaining
borrowing period 3.4 years

3.0 years

3.2 years

2.7 years

2.3 years

2.2 years

3.0 years

93.2%

94.1%

96.5%

98.1%

81.1%

90.5%

94.0%

－%

－%

17.8%

18.1%

18.2%

18.3%

29.1%

50.6%

50.6%

52.5%(Note)

51.5%

51.5%

51.4%

51.5%

Total interestbearing debt

Ratio oflong-term debt
Ratio of fixed debt
Total asset
based LTV

（July 31, 2017） （January 31, 2018）（March 1, 2018）(January 31, 2017)

Status of Maturity ladderPartiallyrefinancing andearly repayment

8,000

Assumed partial early
repayment

2,700

4,000

Investment corporation bonds (private）(existing)Borrowings (new)Borrowings (existing)

3,200
5,000

2,000

2,700

(million yen)

Refinancing

Investment corporation bonds (private）(new)

1,000

6,000

0

Refinancing / Early repayment

5th
periodJanuary
2018

2,700
6th
periodJuly 2018

5,600

5,600

2,500
7th
periodJanuary
2019

5,350

4,000

5,350

2,000
8th
period
July
2019

9th
periodJanuary2020

10thperiod
July
2020

11th
periodJanuary2021

12th
period
July
2021

2,500

1,500

1,000
13th
periodJanuary2022

14thperiod
July
2022

15th
periodJanuary2023

16th
period
July
2023

17th
periodJanuary2024

18thperiod
July
2024

19th
periodJanuary2025（Note）The total based LTV at the time of most recent date is the forecast, calculated by dividing interest-bearing debt by total assets (the amount obtained by adding the total acquisition of
the 33 properties newly acquired on February 1, 2018 and March 1, 2018, including the incidental expenses and consumption taxes to the total assets at the end of 5th fiscal period.)

22

Financial Strategy

Financial highlight
Change in Financial status（January 31, 2018)

Investment corporation bonds (private)[First][Second]
Total issue
amount1 bilion yen 1 billion yen
Maturity
4 years
5 years
Underwriter DBJ Securities Co., Ltd.

（February 1, 2018)

New lenders

Regional banks
17 banks (51.1％)

Regional banks
11 banks (51.4％)(million yen)

Financial
institution

Interestbearing debt

City
banks

SMBC

7,193

16.1%

Resona Bank

3,400

7.6%

Major
banks

Aozora Bank

4,200

9.4%

Regio
nal
banks

Shinsei Bank

Financial
institution
KumamotoBank
The Bank of
Saga

Ratio

The Mie Bank

Regio
nal
banks

Interestbearing debt
1,600

3.6%

1,000

2.2%

700

1.6%

Hiroshima
Bank

600

Shizuoka Bank

500

3,500

7.8%

6,306

14.1%

3,000

6.7%

Oita Bank

500

Shinwa Bank

2,600

5.8%

The Chiba Bank

300

The Tokyo
Star Bank

1,700

3.8%

The Higo Bank

1,500

The Bank offukuoka
The kagawa
Bank

Ratio

Regio
nal
banks

Financial
institution
The Hyakugo
Bank
The Tochigi
BankInterestbearing debt

The Minato Bank

The Kagoshima
1.3%
Bank
The Ashikaga
1.1%
Bank
Fukoku Mutual
1.1% InsuranceLifecompany The Dai-ichi
0.7%
Life
Investment corporation
3.3%
bonds
（Note)

Ratio

1,000

2.2%

600

1.3%

500

1.1%

300

0.7%

200

0.4%

1,100

2.5%

500

1.1%

2,000

4.5%

The light red is new borrower.

23

Appraisal Value Status
Appraisal Value Status and Cap Rate Status

Summary of Appraisal Value■ Change in appraisal value and Cap Rateat the 5th period(Note) A-07 S-FORT Fukuoka Koen: 0.1% compared to 4th period. Cap Rate
has increased by considering the building age.

Change in Cap Rate of properties acquired in the 1st and 3rd fiscal period.
6.5
6.3
6.1

5.8

5.9
5.7
5.5
5.3
5.1
4.9
4.7

5.3
5.2
4.8

4.5
（％）

End of 1st fiscal period

5.8

5.7

5.5

5.4
5.3

5.3

5.2

5.1
5.1
5.0

5.2 5.2

5.2

5.0

4.7

End of 2nd fiscal period (1st PO)

End of 3rd fiscal period

5.2
5.1

5.0

5.0

4.9

4.9

4.8

Major regional cities (acquired in 1st fiscal period)
Ovarall (acquired in 1st fiscal period)
Greater Tokyo area (acquired in 3rd fiscal period)

5.6

4.9
4.6

4.6
End of 4th fiscal period

Other regional cities (acquired in 1st fiscal period)
Major regional cities (acquired in 3rd fiscal period)
Overall (acquired in 3rd fiscal period)(Note) Cap Rate is rounded off to one decimal place.
(Note) Cap Rate at the end of 2nd period for properties acquired through 3rd fiscal period was the figure for newly acquired 20 properties in August 2016 based on
the appraisal report with May 1, 2016 as the valuation date.

End of 5th fiscal period

Greater Tokyo area (acquired in 1st fiscal period)
Other regional cities (acquired in 3rd fiscal period)24

４. Future Growth Strategy

Growth Strategy・Managed Target
1

External
growth strategy

234Internal
growth strategy
Financialstrategy

12Expand the asset size and enhance the quality of the portfolio through continuous
acquisitions of the “S-RESIDENCE” properties developed by the sponsor
Acquire properties through sponsor support – Utilize the warehousing function
Acquire properties by taking advantage of the proprietary channels of the asset
management company
Implement the differentiated portfolio development policy
Enhance the asset value and rate of return through reviewing existing facilities
and other measures
Reduce operating costs

4

Reinforce property competitiveness and enhance usability of residents byintroducing new facilities/equipment
Stabilize earnings by utilizing sublease agreement

1

Lengthen borrowing periods and reduce cost of debt

3

2

Expand the bank formation3

Acquire credit ratings at an early stage

Change in Asset size・Management Target (Based on acquisition price)
150(billion yen)

100

50

0

30.5
Assets at IPO(28 properties)

0.4

30.9

20.5

51.5

29.9

Assets acquired Assets at end of 4th Feb. to Mar.2018
Asset acquired in 1st Assets at end of 1st
PeriodCapital increase
Periodthrough PO in Aug.
Period(49 properties) through third-party(29 properties)
2016(S-FORT
allotment(20 properties)
Gakuenmae)
Acquired properties(33 properties)

Aim to achieve the asset sizeof 100 billion yen over the
medium term

81.5

Mar. 2018
After capitalincrease throughthird-party
allotment(82 properties)

100

Aim to acquirecredit ratings

26External Growth

Investment policy
Secured stable earnings by continuously investing in properties close to medical institutions or
educational facilities such as universities and by adopting the fixed rent master lease (ML).
Ownedproperties

Close touniversities

Close to universities andmedical institutions

New properties acquired
on February 1, 2018

Close to medical
institutions
Fixed-rent ML

Major regional cities

S-FORT
Katahira

S-FORT
FukuokaKencho Mae

S-FORT
Hokudai mae

S-FORT
Chion-inmae

S-FORT
Rokuban-cho

S-FORT
Gakuenmae

S-FORT
Tsurumai cube

S-FORT
Tsurumai reale

S-FORT
Kitamaruyama

S-RESIDENCE
Kobe Motomachi

S-FORT
Toyohira
SanjyoS-FORT
Tsurumicho

S-FORT
Aoba Kamisugi

Other regional cities

Fixed-rent ML

Fixed-rent ML

S-FORT
Saga Idaimae

S-FORT
Saga Honjo
S-FORT
Nishinomiya
Uegahara

S-FORT
Suizenji

S-FORT
Mie Daigakumae

S-FORT
Kumadaibyoinmae

S-FORT
Kumamoto
Senba

Fixed-rent ML

S-FORT
Oita Ekimae
S-FORT
Takasagomachi

S-FORT
Nishinomiya

Fixed-rent ML

GreaterTokyo area

S-FORT
Ichikawa

S-FORT
Hoya

S-FORT
Tamagawa
Gakuen mae

S-FORT
Kashiwa

S-FORT
Noborito

S-FORT
Sagamihara

S-RESIDENCE
Yokosuka Chuo

27

External Growth

External growth strategy（Utilization of abundant information/acquisition channels)
Status of information and acquisition channels
Information
channels

Main Sponsor

Asset Management Company

B
Acquisition
channels

B

AC

Third party

BridgeDeveloppedOwned/
Ware
housing

BridgeC

D

Third party

Third party

Sponser Support

Samty Residential Investment Corporation

28

External Growth

External growth strategy
Status of pipeline
Property NameA

【Developed】

A【Owned・Warehousing】

Location

No. of units(Scheduled)Completion date

Area

①

S-RESIDENCE Tsurumai

Naka-ku, Nagoya City

109 units

2017

Major regional cities②

S-RESIDENCE Shin-Osaka Garden(Kikawa Higashi 4)

Yodogawa-ku, Osaka

177 units

2018

Major regional cities③

S-RESIDENCE Shin-Osaka Luna(Kikawa Higashi2)

Yodogawa-ku, Osaka

90 units

2018

Major regional cities④

S-RESIDENCE Shin-Lsaka Ridente (Nishimiyahara 2 II)

Yodogawa-ku, Osaka

90 units

2018

Major regional cities⑤

S-RESIDENCE Higashi-ku Aoi ２cho-me

Higashi-ku, Nagoya City

95 units

2018

Major regional cities⑥

S-RESIDENCE Shiga Hondouri

Kita-ku, Nagoya City

88 units

2018

Major regional cities⑦

S-RESIDENCE Chigusa-ku Uchiyama 3 cho-me

Chigusa-ku, Nagoya City

44 units

2018

Major regional cities⑧

S-RESIDENCE Kita-ku Nishitemma 3 cho-me

Kita-ku, Osaka City

138 units

2019

Major regional cities⑨

S-RESIDENCE Hongo 3 cho-me

Meito-ku, Nagoya City

77 units

2019

Major regional cities⑩

S-RESIDENCE Esaka-cho 1 cho-me II

Suita City, Osaka

153 units

2019

Other regional cities⑪

S-RESIDENCE Kawasaki Kaizuka

Kawasaki-ku, Kawasaki City

43 units

2017

Greater Tokyo area⑫

S-RESIDENCE Minamiyawata 5 cho-me

Ichikawa-City, Chiba

100 units

2018

Greater Tokyo area⑬

S-RESIDENCE Matsudo-shi Honcho

Matsudo City, Chiba

52 units

2018

Greater Tokyo area⑭

Samty Noborimachi

Naka-ku, Hiroshima City

60 units

2008

Major regional cities⑮

Samty Ohori Koen

Chuo-ku, Fukuoka City

50 units

1998

Major regional cities

Total 15 properties

1,366 units

Properties owned by a third party, considered for acquisition【Third party's properties

C which concluded sales
contract by sponsor】

Property Name①

Niigata Chuo-ku PJ■Center Hotel Tokyo ■Center Hotel Osaka
Nihonbashi, Chuo-ku, Kitahama, Chuo-ku,
Osaka
Tokyo

No. of units

Chuo-ku, Niigata City

83 units

Total 1 properties

Examples of properties, developed/managemed by main sponsor【Hotel】

Location■S-PERIA
Hotel Hakata
Hakata-ku,
Fukuoka City

(Scheduled)Completion date
2018

Area
Other regional cities

83 units【Rental Properties】■Samty Nihonbashi■S-PERIA■Kagoshima City,■Chigusa-ku,
Hotel Nagasaki Nakasu PJ
Kagoshima
NagoyaCity
Chuo-ku,Tokyo
Nagasaki City,■Chuo-ku,
No. of units：64 units
No.
ofunits:35
units
Nagasaki
Sapporo City
No.of units:22 units(Note) Acquisition of any properties described on this page has not been decided as of the date of this document.

29External Growth

External growth strategy (Acquired on February/March 2018)
List of properties
U

Major regional cities
M

S-RESIDENCE Midoribashi SF

Location

Higashinari-ku, Osaka

Completion dateOct-16

S-FORT
Tsurumai reale

S-FORT
Osu Kannon

M

Close to medical institution

S-FORT
Kita-Sanno

S-FORT
Aratamabashi

Showa-ku, Nagoya-shi

Naka-ku, Nagoya-shi

Nakagawa-ku, Nagoya-shi

Minami-ku, Nagoya-shi

No. of rentable units

56 units

84 units

36 units

29 units

Completion dateJan-17Jan-18Aug-12Mar-99U
LocationU

Close to universities

S-FORT
Toyohira Sanjyo

M

U

S-FORT
Kitamaruyama

S-FORT Hakata
Higashi II

S-FORT Hakata
Higashi I

Number of rentable units 148 units
Appraisal value

1,950 million yen
Approx. 2-minute walk from

AccessMidoribashi Station on the Chuo
Line and Imazatosuji Line of Osaka Location

No. ofproperties
Major
regional
citiesOther
regional
citiesGreater
Tokyo
area

Total

No. of units

13

771
units

11

902
units

9

493
units

33

2,166
units

properties
properties
properties
properties

Toyohira-ku, Sapporo-shi

Chuo-ku, Sapporo-shi

Hakata-ku, Fukuoka-shi

Hakata-ku, Fukuoka-shi

No. of rentable units

63 units

49 units

35 units

35 units

Completion dateMar-08

Oct-07

Feb-18

Feb-03

S-FORT Kobe
Sannomiya-Kita

S-FORT
Nakahirodori

Location

M

U

S-FORT
Tsurumicho

M

U

S-FORT
Aoba Kamisugi

Chuo-ku, Kobe-shi

Nishi-ku, Hiroshima-shi

Naka-ku, Hiroshima-shi

Aoba-ku, Senda-shi

No. of rentable units

45 units

74 units

51 units

66 units

Completion dateMar-04Mar-07

Oct-08

Oct-0730

External Growth

External growth strategy (Acquired on February/March 2018)
List of properties
Other regional cities
U
S-FORT
Nishinomiya

S-FORT
Nishinomiya
Uegahara

Nishinomiya-shi,

Nishinomiya-shi,

Hyogo

Hyogo

No. of rentable units

102 units

Completion dateMar-09Location

S-FORT Oita
OtemachiLocation

Oita-shi, Oita

U

Greater Tokyo area
S-FORT
Mito Chuo

Close to universities

M

Close to medical institution

S-FORT Tsu M U S-FORT Mie U S-FORTU S-FORT
Shinmachi
Takasagomachi
Oita Ekimae
Daigaku-mae

Mito-shi, Ibaraki

Tsu-shi, Mie

Tsu-shi, Mie

Oita-shi, Oita

Oita-shi, Oita

62 units

80 units

69 units

62 units

92 units

91 units

Feb-07

Jan-08Jan-10

Feb-06

Dec-06Mar-07

S-FORT
SuizenjiMU

M U S-FORT
S-FORT
Kumamoto
Kumadaibyoin
Senba
-mae

Kumamoto-shi,

Kumamoto-shi,

Kumamoto-shi,

Kumamoto

Kumamoto

Kumamoto

Student S-FORT
domitory

Hoya

U

S-FORT
S-FORT
Tamagawagakuen Tsurukawa-mae

Nishi-Tokyo-shi, Tokyo

Machida-shi, Tokyo

Machida-shi, Tokyo

No. of rentable units

35 units

119 units

99 units

91 units

60 units

45 units

30 units

Completion dateJul-16

Jul-06

Feb-06

Jan-18Mar-07

Feb-08Mar-02Company-rentedhousing

S-FORTS-RESIDENCE
Yokohama Tanmachi Chigasaki

S-FORT
Kawaguchi
Namiki

Yokohama-shi,

Chigasaki-shi,

Kawaguchi-shi,

Kanagawa

Kanagawa

Saitama

No. of rentable units

36 units

36 units

Completion dateNov-16

Jan-17

Location

S-FORT
Todakoen

Company-rentedhousing

S-FORT
Funabashi
TsukadaS-FORT
Kashiwa

Toda-shi, Saitama

Funabashi-shi, Chiba

Kashiwa-shi, Chiba

70 units

62 units

117 units

37 units

Jul-16

Jan-17Mar-08Mar-0631

Internal Growth

Financial Strategy

Initiatives on Sustainability
Obtainment of DBJ Green Building Certification
DBJ Green Building Certification
The DBJ Green Building Certification Program waslaunched by the Development Bank of Japan (DBJ) in
April, 2011 for the purpose of supporting real estate
properties with high environmental and social awareness(Green Building).
The program evaluates, certifies and provides support
for properties sought by society and the economy inperforming comprehensive assessments of properties,
while evaluating various factors including communication
with stakeholders, disaster prevention and proper carefor surrounding communities, in addition to theenvironmental performance of properties.

A-31 S-FORT Tsurumai reale
Address：2-9-3 Tsurumai,Showa-ku,Nagoya-shi,Aichi

Future initiative on sustainability
Recognizing the importance of environmental/social
considerations as well as initiatives to enhance tenantsatisfaction, Samty Residential and Samty AssetManagement aim to further improve unitholder value
by promoting such initiatives.
Furthermore, in order to diversify fund procurement
methods, we aim to proactively obtain sustainability
certifications for properties we own, as well as forother properties we consider acquiring.

Building with highenvironmental
and social awareness

Points recoganized:■Providing a convenient residential

environment such as being conveniently
located near the closest railway station as
well as forming an excellent residential
environment where residents can also enjoy
the natural environment full of greenerysuch as having Tsurumai Park in thesurrounding area.

■Making energy-saving efforts such as

adopting LED lights as well as striving toshare awareness of disaster prevention suchas displaying evacuation routes.

32

Financial Strategy

Financial Highlight
Basic Policy
Equity Finance

The issuance of new investment units will be determined based on the financial environment
and with consideration given to dilution of unitholder value, following a comprehensive reviewof the profitability of the managed asset, timing of the acquisition, LTV level, and repayment
plan for interest-bearing debt, among other factors.

Debt Finance

Debt financing through execution of borrowings and issuance of investment corporation bonds(including short-term investment corporation bonds) will be carried out with consideration
given to the balance between financing flexibility and financial stability.

LTV

LTV levels will be determined with close consideration given to financial capacity.
LTV levels will generally be kept between 45% and 55%, while the ceiling will be set at 60%.

Future Action Plans
Develop new banking relation shipincluding regional banks

Diversify the source of financing acrossJapan as well as geographicaldiversification of assets

Extend remaining borrowing period withconsideration given to costs

Diversify repayment dates

Fix interest rates

Acquire credit ratings at an early stage

33

５. Operating Results and Distribution Information

Management Forecast of the 6th and 7th Fiscal Periods(million yen)

5th fiscal period(January 31, 2018)

Operating revenue
Operating income
Anonymous partnership revenue
Operating expenses
Real estate rental expenses

Difference
between 5th FP
results and 6th
forecast

6th fiscal period
Forecast(July 31, 2018)

Difference
between 6th FP
forecast and 7th
forecast

7th fiscal period
Forecast(January 31,
2019)

1,834

2,869

1,034

2,851

-17

1,817

2,861

1,044

2,851

-10

17

7

-10

-

-

1,045

1,474

428

1,565

91

803

1,184

380

1,179

-4

Miscellaneous rental expenses

254

422

168

420

-2

Taxes and dues

115

115

0

115

0

433

646

212

643

-2

Real Estate rental income

Depreciation

1,013

1,676

663

1,671

-5

Other operating expenses

241

289

48

386

96

Asset management fees

129

128

0

220

92

Other expenses

112

161

48

166

4

Operating income
Non-operating income and loss
Ordinary income
Corporate tax, etc.
Net income

789

1,395

605

1,285

-109

-169

-400

-231

-276

124

620

994

373

1,009

14

0

1

0

1

0

619

993

373

1,008

14
(yen)

Distribution per unit

2,675

2,670

-5

2,700

30

Distribution per unit
(Not including distribution in excess ofearnings)

2,191

2,175

-16

2,207

32

Distribution in excess of earning per unit

484

495

11

493

-2

(Note) Management forecasts for the 6th and 7th fiscal periods are the figures disclosed in the“Summary of Financial Results for Fiscal Period Ended January 2018” announced on March 15, 2018.

Assumptions for Management Forecastof the 6th and 7th Fiscal Periods■ Calculation period
The 6th fiscal period：
February 1, 2018 to July 31, 2018
The 7th fiscal period :August 1, 2018 to January 31, 2019
■ Asset (No. of acquired properties
as of the date of this document）
The 6th fiscal period：82 properties
The 7th fiscal period : 82 properties■ Period average month-end occupancy rate
The 6th fiscal period：95.9%
The 7th fiscal period : 96.2%■ Balance of interest-bearing debt at end of period
The 6th fiscal period：44,600 million yen
The 7th fiscal period：44,600 million yen■ No. of outstanding units(No. of investment units issued and outstanding
as of the date of this document)
The 6th fiscal period：456,600 units
The 7th fiscal period : 456,600 units■ Capital expenditures (planned amount)
The 6th fiscal period：68 million yen
The 7th fiscal period : 68 million yen

Difference factors between 5th
FP results and 6th forecast■ Real estate rental revenue
Increase in revenue due to the increase in rent andcommon area expenses and key money during peakseason in addition to the increase in the number ofproperties+1,034 million yen■ Real estate rental expenses
Increase in leasing promotion expenses and otheroperating expenses during peak season in addition
to the increase in the number of properties+380 million yen■ Non-operating income and loss
Increase in borrowing related expenses due toborrowings, etc. related to the acquisition of new
properties-231 million yen

36Outlook of Distribution
Continuing to pay stable distribution every fiscal period since listing
Aim to maintain/improve distribution level■Distribution policy
Distribution withpayout ratio aiming
for around 70%

Initial distribution

当初予想分配⾦
forecast (including

distribution in excessof earnings)

Distribution per unit

利益分配⾦
(Not including

distribution in excessof earnings)

(yen)

2,026

2nd Period
予想
実績

2,700

484

495

493

2,138

2,169

2,191

2,175

2,207

3rd Period
予想
実績

4th Period
予想
実績

5th Period
予想
実績

6th 予測Period7th 予測Period(January 2018)
第5期(July 2018)
第6期(January
2019)
第7期(Forecast)(Forecast)(July 2016)(January第3期
2017)(Normal period)(Normal period)

第2期

2,670

2,670

2,625

2,600

2,478

2,675

501

507

592

of earnings per unit

2,670

2,645

2,618

Distribution in excess
利益超過分配⾦(July 2017)第4期(Normal period)(Normal period)37

Distribution Policy (1) Due to the characteristics of the portfolio, the ratio of depreciation to property acquisition price tends to be large, thus
Samty Residential aims to increase fund efficiency through optimal fund allocation and improvement of unitholder value overthe medium to long term.
 In regards to the 5th and the 6th Fiscal Period, Samty Residential determined that it is appropriate to conduct distributions inexcess of earnings in consideration of the market environment and financial conditions.
 Distribution amounts are determined based on the target payout ratio aiming for 70%.

Cash Management Strategy

Based on the characteristics of the portfolio, Samty Residential will optimally distribute free cash flow after allocating
funds to reserves for capital expenditures to maintain the building functions, etc., working capital and such, in
accordance with the situations of the time.

Cash will be allocated based on a comprehensive review of the external economic environment, real estatemarket conditions, and financial condition of Samty Residential

Capital expenditures to maintain thebuilding functions, etc.

Securement of working
capital on hand, etc.

Optimally allocate the free cash to each measure listed below after the fund allocation mentioned above

Return to unitholders including distribution in excess of earnings[1st to 5th fiscal periods]
Distribution in excess of earnings per unit: 645 million yen

Reinforcement of the financial base by
reducing interest-bearing liabilities, etc.

[1st to 5th fiscal periods] Repaid amount: 1,612 million yen

Investment that should help enhance
the portfolioʼs profitability enhance[1st to 4th fiscal periods] Investment amount for Bridgefunds: 270 million yen

38Distribution Policy (2)Distributions in Excess of Earnings

Samty Residential may decide the amount of each fiscal period's cash distributions in excess of earnings, based on the
payout ratio as our management result. However, when deciding distribution in excess of earnings, the following
requirements are to be fulfilled, taking into account Samty Residentialʼs financial conditions, amount of future capital
expenditures, etc., in order to avoid undermining unitholder value.
■Conceptual diagram of distributions in excess of earnings
Expensesrelated torent business,sales, generalandadministrativ
e expenses,
non-operating
expenses, etc.

(1) Determination of distributions
With a view to enhancing unitholder value
over the medium to long term, distributions inexcess of earnings are authorized when
Samty Residentialʼs portfolio meets the below
conditions.

Total
appraisalvalue

CAPEX for thefollowing fiscal
period(2) Determination of amountAmount of distributions (including distributions inexcess of earnings) are determined for each fiscal
period based on future capital expenditures, capitaldemand, etc.

Rentalrevenue

Payout ratio = Total distribution amount (including distributions
in excess of earnings) / (Net income + Depreciation)）
Depreciation

Total adjusted
book value(Note)Net income

Distribution
in excess ofearnings

Distribute payout ratio
aiming for 70%

Distribution(profits)

However, distributions in excessof earnings will be up to 35% ofdepreciation

Note: Excluding amount equivalent to incidental expenses upon acquisition

Outlook of cash flow

■6th fiscal period (January 2018)
2,000
1,500
1,000
500
0
(million yen)

FFO
1,640

Capex
68

AFFO
1,572

Distributions inexcess of earnings
226■7th fiscal period (January 2019)
2,000

FFO
1,651

353
1,500

Dipreciation
646

1,000
Distributions
993

Net income
994
FFO

CAPEX

AFFO

Total cash
distribution

500

Cash available
for use

Capex
68

AFFO
1,583

Distributions inexcess of earnings
225

350

Dipreciation
643
Distributions
1,007

Net income
1,008

0(million yen)

FFO

CAPEX

AFFO

Total cash
distribution

Cash available
for use39

Feature of Excess of Earnings and Portfolio
Feature of Investments in Residential Properties
Located in Regions outside Tokyo

Feature of Samty Residential Investment
Corporationʼs Portfolio

A feature of investing in residential properties located in regions is
its tendency to incur depreciation that is relatively large inproportion to the acquisition price of properties.

Samty Residential Investment Corporationʼs portfolio is mainlycomprised of relatively new properties.
Furthermore, in accordance with the sponsor support
agreement, exclusive negotiating rights of S-RESIDENCE
series, properties newly developed and conveniently located,
are granted to Samty Residential Investment Corporation by
the sponsor. Therefore, this feature is believed to remain going
forward.

■Ex.: Comparison between residential properties in regions andin Greater Tokyo area
(Assuming depreciation period as 50 years, NOI yield as 6.0%
and 5.0% for regions and Greater Tokyo area respectively.
These figures are examples and do not represent any specificproperty owned by Samty Residential Investment Corporation.)[Residential property
in a region]
Building: 3 billion yen
Land: 1 billion yen

Depreciation: 60 million yen/year
NOI yield： 6.0％
NOI yield after depreciation ：4.5％
Depreciation rate：1.5％

1[Residential property inGreater Tokyo area]
Building: 3 billion yen
Land: 3 billion yen

Depreciation： 60 million yen/year
NOI yield： 5.0％
NOI yield after depreciation ：4.0％
Depreciation rate: 1.0％

2

Portfolio composition withaverage building age of 8.5
years

Stable supply of newly
developed properties from thesponsor

Ratio of CAPEX to totalacquisition price ofproperties is expected toremain at a low level*Depreciation rate is the ratio of depreciation to the acquisition price of properties.

40

６. Appendix

Characteristics of Regional Residence Investments (1)Household growth rate (Year 2000 = 100%)＋23.0%＋20.1%＋25.0%＋20.4%＋19.2%＋14.0%＋18.6%＋16.7%＋17.1%＋30.0%Net Migration

Source: Prepared by Sumitomo Mitsui Trust Research Institute based on “Basic
Resident Registers,” Ministry of Internal Affairs and Communications

Growth rate from 2000 to 2016

Household growth rate of major
regional cities is comparable to thatof Greater Tokyo Area.
Growth rates of Sapporo City andFukuoka City surpass that of Tokyo
23 Wards.
Source: Prepared by Sumitomo Mitsui Trust Research Institute based on“Basic Resident Registers,” Ministry of Internal Affairs and Communications

Number of New Housing Starts(Year 2000＝100%）

Source: Prepared by Samty Asset Management based on “Housing Starts Statistics (yearly),”(house for rent/reinforced concrete structure, steel framed reinforced concrete
structure/residential complex)
Ministry of Land, Infrastructure, Transportation and Tourism, Information Policy Division,
Construction Research and Statistics Office42

Overview of the Samty Group
Samty Co., Ltd.

Business Model of Samty Group

ListingFirst Section of the Tokyo Stock
Exchange (Securities code: 3244)

Established

December 1, 1982

Location of head office
Capital4-3-24, Nishi-Nakajima,
Yodogawa-ku, Osaka City
8.4 billion yen(as of the end of November 2017)
Real estate businessBusiness description

Property leasing business

Overseas
investment

Domestic market
Purchase

Overseas market Sales ofdeveloped
properties

Provide development properties

Samty Group

Condominiums
for investment

Condominium
sales companies

Number of employees

Net sales 60,479 million yen(Fiscal period ended November 2017)
Ordinary income 8,461 million yen(Fiscal period ended November 2017)
99 (as of the end of November 2017)※188 on a consolidated basis

沿⾰

Sep.
2002

Samty Development Co., Ltd.
(currently Samty Co., Ltd.)established at Nakajima 1-chome,
Higashi-Yodogawa Ward, Osaka City
Launched the real estate
securitization business and conducted
real estate securitization that was thefirst such operation approved by the
Kinki Local Finance Bureau

Jun.
2012
Nov.
2012
May
2015

Mar.
2005

Launched the S-Residence series ofrental condominiums for real estate
funds and REITs

Oct.
2015
Mar.
2016

Jul.
2007

Shares listed on the Osaka Securities
Exchange's Hercules market(currently the Tokyo Stock
Exchange's JASDAQ Standard).

Feb.
2011
Dec.
2011

Samty Residential
Investment
Corporation

Leasing of
owned
properties

Recovery of development capital

Rental apartment/
Office buildings
Commercial facilities

Entrust asset and property
management service

Samtyʼs businessHistory and Business
Dec.
1982

Tenants

Property and operation
management support

Integration of
investor andgroup earnings
through sponsor
support contract

Real estate planning and design, etc.
Operating results(consolidated basis)

Income properties
Land for development

Established Fukuoka Branch OfficeAcquired shares in Samty AssetManagement Co., Ltd. to make ita wholly-owned subsidiary
Established Sapporo Branch Office

Real estatebusiness

Property leasing
business

Leasing and management of condominiums,
office buildings, etc.

Other business

Hotel operation
Management of for-sale condominiums
Construction and reform
Planning of support system concerning medical care

Moved up to the First Section of theTokyo Stock Exchange.
Established Nagoya Branch OfficePlanning, development and sales of for-sale condominiums forfamilies and condominiums for investment Planning,development, regeneration and sales of income properties, etc.
Operation, management and investment in real estate
investment funds

Established Tokyo Branch Office

Shiba Inu Maru Edition

Established Samty Kanri Co., Ltd.
that is engaged in property
management business

Samtyʼs TV commercial
now beingbroadcasted!!

43Condominium Brand “S-RESIDENCE”
in Samty Residentialʼs Portfolio
S-RESIDENCE Brand

Washstand with modern taste

 “S-RESIDENCE” is a high quality, rental condominium brand developed by
Samty Group since 2005.

Double lock with dimple key
for high security

 “S-RESIDENCE” is a brand characterized by the opulent utilization offieldstones, entrances with open spaces, luxury hotel-like indirect lighting andcorridors, high quality plumbing which display a luxuriousness, etc., possesshigh quality designs which appeal mainly to students, workers, etc., andparticularly the high relative ratio of female tenants.

S-RESIDENCE
Shin Osaka EkimaeHigh-classelevator hall

Serene and massive
entrance hall

Bathroom heater/dryer/
ventilation system
Hands-freeassuring comfort whenintercomtaking a bath in winterwith a monitor
or drying clothes on rainy days

Bright and stylish
kitchen and bathroom

Safe flat flooringby eliminating difference inlevel on the floor to prevent trips
Flat-designed floors

Self-locking system that securesdaily peace of mind and safety
Security cameras that are effective
for preventing vandalism andcrimes are installed in the building
and elevators
Convenient home-delivery box forreceiving parcels around-the-clock
Toilet with variety of functions
such as self-cleaning and heater

Imageillustration

Cushioned flooring withexcellent sound-absorption 44

Portfolio List (1) Major Regional Cities
List of acquired properties(Number of acquired properties as of the date of this document ）Property
No

Property Name

Location■New properties owned on February 1, 2018 and March 1, 2018.

Type

Acquisition

Appraisal Value

Appraisal

Number ofPrice

at End of Period

NOI yield

rentable(million yen)(million yen)

(%)

units

Major regional cities
A-01

S-FORT Shin Osaka ravir

Yodogawa-ku, Osaka

Single / Compact

635

683

5.3

49

A-02

S-FORT Sanno

Nakagawa-ku, Nagoya

Single / Compact

2,890

3,270

6.1

230

A-03

S-FORT Fujigaoka

Meitou-ku, Nagoya

Single

750

830

6.0

80

A-04

S-FORT Chikushi Dori

Hakata-ku, Fukuoka

Compact

1,170

1,220

5.5

90

A-05

S-FORT Fukuoka Kencho Mae

Hakata-ku, Fukuoka

Single

979

1,080

5.7

104

A-06

S-FORT Takamiya

Minami-ku, Fukuoka

Single / Commercial

794

830

5.4

82

A-07

S-FORT Tsutsujigaoka Koen

Miyagino-ku, Sendai

Single / Compact / Family

1,340

1,410

5.8

94

A-08

S-RESIDENCE Namba Briller

Naniwa-ku, Osaka

Single

2,020

2,350

5.4

154

A-09

S-FORT Tsurumai marks

Naka-ku, Nagoya

Family

1,020

1,210

5.8

42

A-10

S-FORT Rokuban-cho

Atsuta-ku, Nagoya

Single / Commercial

722

762

5.3

56

A-11

S-FORT Nakajima Koen

Chuo-ku, Sapporo

Compact / Family

1,590

1,650

5.6

75

A-12

S-FORT Hokudai Mae

Kita-ku, Sapporo

Compact / Commercial

690

755

5.8

59

A-13

S-RESIDENCE Kobe Isogamidori

Chuo-ku, Kobe

Single / Compact

2,470

2,800

5.4

166

A-14

S-FORT Kyoto Nishioji

Shimogyo-ku, Kyoto

Single / Commercial

A-15

S-FORT Katahira

Aoba-ku, Sendai

Single / Compact

745

806

5.8

71

2,330

2,590

5.8

191

A-16

S-FORT Gakuenmae

Toyohira-ku, Sapporo

Single / Compact

A-17

S-RESIDENCE Shin Osaka Ekimae

Higashi Yodogawa-ku, Osaka

Single / Compact

462

487

5.9

48

2,489

2,760

5.2

167

A-18

S-FORT Aoi 1-Chome

Higashi-ku, Nagoya

Compact

1,080

1,130

5.2

54

A-19

S-FORT Aoi

Higashi-ku, Nagoya

Family

870

992

5.6

28

A-20

S-FORT Kurumamichi

Higashi-ku, Nagoya

Family

400

432

5.8

19

A-21

S-FORT Kamiotai

Nishi-ku, Nagoya

Family

720

744

5.6

40

A-22

S-FORT Tsurumai arts

Naka-ku, Nagoya

Family

680

805

5.8

28

A-23

S-FORT Tsurumai cubeNaka-ku, Nagoya

Compact / Family

570

670

5.7

32

A-24

S-FORT Fukuoka Higashi

Hakata-ku, Fukuoka

Compact

1,900

2,040

5.4

135

A-25

S-RESIDENCE Kobe Motomachi

Chuo-ku, Kobe

Single / Compact

1,200

1,380

5.7

81

A-26

S-FORT Kobe Kaguracho

Nagata-ku, Kobe

Single

1,858

2,170

6.2

168

A-27

S-FORT Nijo-jo mae

Nakagyo-ku, Kyoto

Single / Compact / Family

812

872

5.2

47

A-28

S-FORT Chion-in mae

Higashiyamaku, Kyoto

Compact / Family / Comm

500

525

5.0

18

A-29

S-FORT Miyamachi

Aoba-ku, Sendai

Single / Compact

1,085

1,110

5.4

91

(Note) Appraisal values is the figure as of the end of January 2018 for owned 49 properties and as of November 1, 2017
for the 33 properties acquired on February 1, 2018 and March 1, 2018.

45

Portfolio List (2) Major Regional Cities / Other Regional Cities
List of acquired properties(Number of acquired properties as of the date of this document ）Property
No

Property Name

Location

Type■New properties owned on February 1, 2018 and March 1, 2018.
Acquisition

Appraisal Value

Appraisal

Number ofPrice

at End of Period

NOI yield

rentable(million yen)(million yen)

(%)

units

Major regional cities■

A-30

S-RESIDENCE Midoribashi Ekimae

Higashi-ku, Osaka

Single

1,846

1,980

5.1

148

■

A-31

S-FORT Tsurumai reale

Showa-ku, Nagoya

Compact / Family

1,571

1,640

5.1

56

■

A-32

S-FORT Osu Kannon

Naka-ku, Nagoya

Single / Compact

1,147

1,250

5.6

84

■

A-33

S-FORT Kita-Sanno

Nakagawa-ku, Nagoya

Compact

841

844

4.8

36

■

A-34

S-FORT Aratamabashi

Minami-ku, Nagoya

Compact

449

452

5.6

29

■

A-35

S-FORT Toyohira Sanjyo

Toyohira-ku, Sapporo

Compact

762

786

5.8

63

■

A-36

S-FORT Kitamaruyama

Chuo-ku, Sapporo

Compact

425

428

5.6

49

■

A-37

S-FORT Hakata-Higashi I

Hakata-ku, Fukuoka

Single / Compact

389

392

5.3

35

■

A-38

S-FORT Hakata-Higashi II

Hakata-ku, Fukuoka

Single / Compact

382

385

5.3

35

■

A-39

S-FORT Kobe Sannomiya-Kita

Chuo-ku, Kobe

Single

515

518

5.1

45

■

A-40

S-FORT Nakahirodori

Nishi-ku, Hiroshima

Single

885

897

5.3

74

■

A-41

S-FORT Tsurumicho

Naka-ku, HiroshimaCompact / Family

820

823

5.1

51

■

A-42

S-FORT Aoba Kamisugi

Aoba-ku, Sendai-shi

Compact

918

990

5.7

66

B-01

S-FORT Shizuoka HondoriAoi-ku, Shizuoka

Compact

B-02

S-FORT Suminodo

Daitou-shi, Osaka

Single / Compact

B-03

S-FORT Yokkaichi motomachi

Yokkaichi-shi, Mie

Compact

B-04

S-FORT Suzuka

Suzuka-shi, Mie

Compact

B-05

S-RESIDENCE Esaka

Suita-shi, Osaka

Single / Compact

2,323

B-06

S-FORT Utsunomiya

Utsunomiya-shi, Tochigi

Compact

612

B-07

S-FORT Yokkaichi Nishishinchi

Yokkaichi-shi, Mie

Compact / Family

B-08

S-FORT Saga Honjo

Saga-shi, Saga

Compact / Office

B-09

S-FORT Saga Idaimae

Saga-shi, Saga

Compact

Other regional cities
297

311

6.0

28

1,420

1,590

5.9

126

480

531

6.7

54

580

620

6.8

69

2,550

5.2

138

642

6.0

52

630

721

6.7

60

1,050

1,070

6.2

127

375

396

6.5

46

(Note) Appraisal values is the figure as of the end of January 2018 for owned 49 properties and as of November 1, 2017
for the 33 properties acquired on February 1, 2018 and March 1, 2018.

46

Portfolio List (3) Other Regional Cities / Greater Tokyo Area
List of acquired properties(Number of acquired properties as of the date of this document ）Property
No

Property Name

Location■New properties owned on February 1, 2018 and March 1, 2018.

Type

Acquisition

Appraisal Value

Appraisal

Number ofPrice

at End of Period

NOI yield

rentable(million yen)(million yen)

(%)

units

Other regional cities■

B-10

S-FORT Nishinomiya

Nishinomiya-shi, Hyogo

Single / Compact

1,412

1,500

5.3

■

B-11

S-FORT Nishinomiya Uegahara

Nishinomiya-shi, Hyogo

Single

789

805

5.1

102
62

■

B-12

S-FORT Mito Chuo

Mito-shi, Ibaraki

Family

1,807

1,810

5.6

80

■

B-13

S-FORT Tsu Shinmachi

Tsu-shi, Mie

Compact

767

836

6.2

69

■

B-14

S-FORT Mie Daigaku-mae

Tsu-shi, Mie

Compact

599

645

6.2

62

■

B-15

S-FORT Takasagomachi

Oita-shi, Oita

Single / Compact / Family

1,015

1,020

5.7

92

■

B-16

S-FORT Oita Ekimae

Oita-shi, Oita

Single / Compact

904

907

5.7

91

■

B-17

S-FORT Oita Otemachi

Oita-shi, Oita

Single

277

280

5.5

35

■

B-18

S-FORT Suizenji

Chuo-ku, Kumamoto

Single / Compact

1,332

1,340

5.6

119

■

B-19

S-FORT Kumadaibyoin-mae

Chuo-ku, Kumamoto

Compact

1,125

1,150

5.6

99

■

B-20

S-FORT Kumamoto Senba

Chuo-ku, Kumamoto

Single / Compact / Family

1,010

1,040

5.9

91

Greater Tokyo area

Total

C-01

S-FORT Maita Koen

Minami-ku, Yokohama

Single / Compact

987

1,050

5.2

70

C-02

S-FORT Nihombashi Hakozaki

Chuo-ku, Tokyo

Single / Compact

925

1,030

4.8

36
32

C-03

S-FORT Itabashi Shimura

Itabashi-ku, Tokyo

Compact

645

688

4.9

C-04

S-FORT Shiomi

Koto-ku, Tokyo

Single

866

1,030

5.2

52

C-05

S-FORT Noborito

Tama-ku, Kawasaki

Single

666

695

4.9

40

C-06

S-FORT Shonan Hiratsuka

Hiratsuka-shi, Kanagawa

Single

818

957

5.8

66

C-07

S-FORT Nishifunabashi

Funabashi-shi, Chiba

Single / Compact

732

775

5.3

47
83

C-08

S-FORT Maihama

Urayasu-shi, Chiba

Single

1,130

1,210

5.4

C-09

S-FORT Ichikawa

Ichikawa-shi, Chiba

Single / Commercial

809

869

5.2

51

C-10

S-RESIDENCE Yokosuka Chuo

Yokosuka-shi, Kanagawa

Single / Nursery

850

937

6.0

25
53

C-11

S-FORT Sagamihara

Sagamihara-shi, Kanagawa

Single

585

623

5.2

■

C-12

S-FORT Hoya

Nishitokyo-shi, Tokyo

Single

645

728

5.7

60

■

C-13

S-FORT Tamagawagakuen-mae

Machida-shi, Tokyo

Single

587

605

5.0

45

■

C-14

S-FORT Tsurukawa

Machida-shi, Tokyo

Family

520

523

5.1

30

■

C-15

S-RESIDENCE Yokohama Tanmachi Kanagawa-ku, Yokohama-shi

Single

627

694

5.1

36

■

C-16

S-FORT Chigasaki

Chigasaki-shi, Kanagawa

Single / Compact

1,137

1,140

4.9

36

■

C-17

S-FORT Kawaguchi Namiki

Kawaguchi-shi, Saitama

Single

1,110

1,130

4.7

70

■

C-18

S-FORT Todakoen

Toda-shi, Saitama

Single

914

938

4.8

62

■

C-19

S-FORT Funabashi Tsukada

Funabashi-shi, Chiba

Compact

1,900

1,940

5.1

117

■

C-20

S-FORT Kashiwa

Kashiwa-shi, Chiba

Single / Compact

536

552

5.2

37

81,51587,6265.5

5,920

82 properties(Note) Appraisal values is the figure as of the end of January 2018 for owned 49 properties and as of November 1, 2017
for the 33 properties acquired on February 1, 2018 and March 1, 2018.

47

Income and Expenditure by Property (1)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Major regional cities（２）Property No.

A-01
S-FORT Shin Osaka（３）Property nameravir（４）Acquisition date
（５）
Price
information（６）
Leasing
information

Apr-15, 2015

Apr-15, 2015

Kencho Mae

May-01, 2015

Apr-15, 2015

1,170

S-FORT Takamiya

May-01, 2015
979

794

S-FORT
Tsutsujigaoka Koen
Apr-15, 2015

1.2

5.6

1.5

2.3

1.9

1.5

2.6

2,930

747

1,183

999

800

1,370

Total rentable area(㎡)

1,290.84

8,138.40

1,960.00

3,706.56

2,566.72

2,105.13

3,609.49

Leased area(㎡)

1,159.72

8,061.33

1,813.00

3,706.56

2,566.72

2,080.29

3,500.86

Occupancy rate

(%)

89.8

99.1

92.5

100.0

100.0

98.8

97.0

184

184

184

184

184

184

184

20,019113,406

30,46642,93336,25928,33750,921

Real estate rental revenues

18,869103,761

27,13439,65034,677

27,102

45,691Other lease business revenues

1,149

9,644

3,331

3,283

1,582

1,234

5,230

4,355

23,467

6,293

9,135

7,407

6,121

10,168

Management service fee

1,171

6,092

1,508

1,521

1,498

1,236

2,179

Taxes and dues

1,308

8,157

1,982

2,980

2,427

2,019

2,861

Utilities expenses

274

818

327

474

373

304

1,620

Repair Cost

210

3,523

977

1,755

1,197

1,030

1,084

Insurance expenses

33

179

46

94

62

61

83

Trust fees

303

303

303

303

303

303

303

1,052

4,391

1,146

2,004

1,543

1,165

2,034

Other lease business expenses

750

S-FORT Fukuoka

Dori

641

(thousand yen)

2,890

S-FORT Chikushi

A-07(million yen)

(3) Regal estate rental expenses

information

Apr-15, 2015

A-06

(%)

(thousand yen)expenses

S-FORT Fujigaoka

A-05(million yen)

(1) Number of operating days

Income and

S-FORT Sanno

A-04

Composition rate(2) Total real estate rental income

（７）

A-03

Acquisition price

Balance sheet amount

635

A-02

1,340

(4) NOI(＝(2)-(3))(thousand yen)

15,66489,93924,172

33,79828,852

22,21540,753(5) Depreciation(thousand yen)

4,666

26,697

10,163

10,814

9,204

8,803

12,305

10,997

63,241

14,00922,984

19,647

13,411

28,447

-

107

-

771

1,619

118

-

15,66489,831

24,172

33,027

27,23322,09740,753(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)48

Income and Expenditure by Property (2)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Major regional cities（２）Property No.

（３）Property name（４）Acquisition date
（５）
Price
information（６）
Leasing
information

A-12

A-13

A-14

S-RESIDENCE

S-FORT Tsurumai

S-FORT Rokuban-

S-FORT Nakajima

S-FORT Hokudai

S-RESIDENCE Kobe

S-FORT Kyoto

Namba Briller

marks

cho

Koen

Mae

Isogamidori

NishiojiJul-01, 2015

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

(%)

3.9

2.0

1.4

3.1

1.3

4.8

1.4

(million yen)

2,068

1,071

728

1,646

716

2,525

763

(㎡)

3,631.60

2,772.00

1,833.29

5,292.65

2,287.22

4,372.45

1,657.31

Leased area(㎡)

3,493.74

2,574.00

1,772.45

4,530.22

2,287.22

4,347.24

1,514.81

Occupancy rate

(%)

96.2

92.9

96.7

85.6

100.0

99.4

91.4

184

184

184

184

184

184

184

67,43536,09822,93455,36924,721

86,623

26,276

Real estate rental revenues

63,24432,664

21,44551,18723,65579,43024,363

Other lease business revenues

4,190

3,434

1,489

4,182

1,066

7,193

1,913

14,418

6,060

6,168

17,167

4,563

12,075

7,766Management service fee

2,546

2,183

1,230

2,591

1,003

2,719

1,587

Taxes and dues

5,016

1,679

1,666

4,787

1,618

5,422

1,446

826

260

239

1,013

340

485

1,010

1,845

589

514

5,021

268

1,313

835

Balance sheet amount
Total rentable area

(3) Regal estate rental expenses(thousand yen)

information

A-11(million yen)(thousand yen)expenses

A-10

Composition rate(1) Number of operating days

（７）

A-09

Acquisition price(2) Total real estate rental income

Income andA-08

Utilities expenses
Repair Cost

2,020

1,020

722

1,590

690

2,470

745

Insurance expenses

105

56

39

122

53

117

45

Trust fees

405

303

303

405

303

405

303

3,672

987

2,175

3,226

974

1,611

2,536

(4) NOI(＝(2)-(3))

Other lease business expenses(thousand yen)

53,01630,038

16,76638,202

20,15874,54818,510(5) Depreciation(thousand yen)

13,809

9,736

7,480

13,711

5,291

18,373

6,478

39,207

20,302

9,285

24,49014,86656,175

12,031

1,073

-

-

12,079-220-

51,94230,038

16,766

26,122

20,15874,32818,510(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)49

Income and Expenditure by Property (3)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Major regional cities（２）Property No.

A-15

A-16

（３）Property name

S-FORT Katahira

S-FORT Gakuenmae

Jul-01, 2015

Oct-01, 2015

（４）Acquisition date
（５）
Price
information（６）
Leasing
information

Acquisition price(million yen)

Composition rate

Chome

Aug-02, 2016

Aug-01, 2016

S-FORT

S-FORT Aoi

S-FORT Kamiotai

Kurumamichi

Aug-02, 2016

1,080

A-21

Aug-01, 2016

870

Aug-01, 2016

400

720

4.5

0.9

0.6

2.8

0.9

1.1

1.9

480

2,570

1,142

934

417

775

Total rentable area(㎡)

5,483.22

1,757.28

4,534.98

2,185.20

1,842.68

1,214.20

2,624.40

Leased area(㎡)

5,280.55

1,692.75

4,534.98

1,982.66

1,776.87

968.382,624.40

Occupancy rate

(%)

96.3

96.3

100.0

90.7

96.4

79.8

100.0

184

184

184

184

184

184

184

86,142

16,91984,39533,93330,316

14,16026,723

Real estate rental revenues

80,743

15,74079,141

30,11728,381

12,82324,232Other lease business revenues

5,398

1,178

5,254

3,815

1,934

1,337

2,490

19,052

4,147

13,605

7,105

4,543

3,338

7,497

(3) Regal estate rental expenses(thousand yen)expenses

S-FORT Aoi 1-

Osaka Ekimae

A-20

2,335

(thousand yen)

information

S-RESIDENCE Shin

2,489

A-19

(%)

(2) Total real estate rental income

Income and

462

A-18

(million yen)

Balance sheet amount(1) Number of operating days

（７）

2,330

A-17

Management service fee

4,083

763

3,169

1,664

1,311

888

1,100

Taxes and dues

6,286

1,277

5,152

2,230

1,158

1,035

1,972

711

359

939

350

216

169

339

4,714

633

1,483

803

320

863

1,759

Utilities expenses
Repair Cost
Insurance expenses

146

31

92

44

31

24

48

Trust fees

303

283

303

303

-

-

303

2,804

798

2,463

1,708

1,504

357

1,972

(4) NOI(＝(2)-(3))

Other lease business expenses(thousand yen)

67,09012,77170,79026,827

25,772

10,821

19,225(5) Depreciation(thousand yen)

28,1094,687

18,999

7,369

4,882

2,421

6,612

38,981

8,083

51,79019,457

20,8908,399

12,613

1,308

510

-

122

-

1,162

1,975

65,782

12,26170,79026,70425,772

9,658

17,250(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)50

Income and Expenditure by Property (4)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Major regional cities（２）Property No.

（３）Property name（４）Acquisition date
（５）
Price
information（６）
Leasing
information(million yen)

Composition rate
Balance sheet amount

A-26

S-FORT Tsurumai

S-FORT Tsurumai

S-FORT Fukuoka

S-RESIDENCE Kobe

S-FORT Kobe

arts

cube

HigashiMotomachi

KagurachoAug-02, 2016

Aug-02, 2016

Aug-02, 2016

680

Aug-02, 2016

570

1,900

1,200

A-27

A-28

S-FORT Nijo-jo mae
Aug-02, 2016

1,858

S-FORT Chion-inmae
Aug-02, 2016

812

500

1.8

1.3

1.7

1.3

1.6

1.4

2.2

735

594

1,989

1,240

1,919

830

513

Total rentable area(㎡)

1,988.56

1,460.64

5,584.41

2,169.67

4,900.32

1,735.95

1,049.01

Leased area(㎡)

1,917.54

1,300.26

5,471.97

2,169.67

4,841.94

1,735.95

1,049.01

Occupancy rate

(%)

96.4

89.0

98.0

100.0

98.8

100.0

100.0

184

184

184

184

184

184

184

24,20520,08763,03240,89968,932

23,466

14,797

Real estate rental revenues

22,626

18,60856,58339,29764,57823,248

14,797

Other lease business revenues

1,579

1,478

6,448

1,602

4,354

217

0

3,665

4,975

12,072

5,202

14,712

1,988

1,114

Management service fee

1,229

1,135

2,167

1,652

2,301

-

-

Taxes and dues

1,208

995

3,884

2,886

4,308

1,357

782

Utilities expenses

181

142

431

304

498

-

-

Repair Cost

211

549

3,222

-

3,040

289

-

Insurance expenses

33

29

99

48

76

28

18

-

303

303

303

303

303

303

(3) Regal estate rental expenses(thousand yen)expenses

A-25

(%)

(thousand yen)

information

A-24(million yen)

(2) Total real estate rental income

（７）

A-23

Aug-02, 2016

Acquisition price(1) Number of operating days

Income andA-22

Trust fees

801

1,818

1,962

7

4,183

8

10

(4) NOI(＝(2)-(3))

Other lease business expenses(thousand yen)

20,54015,11150,96035,69754,21921,478

13,683(5) Depreciation(thousand yen)

4,492

4,094

13,376

9,932

12,326

6,034

3,580

16,04811,01737,58325,764

41,893

15,443

10,103

-

-

252

-

4,596

461

-

20,54015,11150,70735,69749,62321,016

13,683(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)51

Income and Expenditure by Property (5)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Major regional cities（２）Property No.

A-29

B-01

B-02

（３）Property name

S-FORT Miyamachi

S-FORT Miyamachi

S-FORT Suminodo（４）Acquisition dateAug-02, 2016

Apr-15, 2015

Apr-15, 2015

（５）
Price
information（６）
Leasing
information

580

Aug-02, 2016

4.8

2.1

1.7

0.8

1.4

1.3

302

1,427

502

606

2,394

638

(㎡)

2,213.12

911.403,332.16

1,691.28

2,286.69

3,739.30

2,330.64

Leased area(㎡)

2,065.28

781.203,041.99

1,691.28

2,286.69

3,501.36

2,330.64

Occupancy rate

(%)

93.3

85.7

91.3

100.0

100.0

93.6

100.0

184

184

184

184

184

184

184

37,215

11,157

51,68822,061

26,45273,571

24,748

Real estate rental revenues

33,455

10,44244,335

19,60522,42369,961

22,885

Other lease business revenues

3,759

715

7,352

2,456

4,029

3,610

1,862

9,117

3,676

12,634

5,047

8,054

11,205

7,963

1,594

1,092

1,752

1,411

1,607

2,432

1,476

Management service fee

480

Aug-02, 2016

1.6

(thousand yen)

1,420

Jul-01, 2015

1,114

(3) Regal estate rental expenses

information

Jul-01, 2015

S-RESIDENCE Esaka S-FORT Utsunomiya(million yen)(thousand yen)expenses

S-FORT Suzuka

Motomachi

B-06

(%)

(2) Total real estate rental income

Income and

S-FORT Yokkaichi

B-05(million yen)

(1) Number of operating days

（７）

B-04

Composition rate

Total rentable area

297

B-03

Acquisition price

Balance sheet amount

1,085

Other regional cities

2,323

612

Taxes and dues

1,838

852

2,894

1,120

1,660

4,328

2,282

Utilities expenses

1,339

176

1,507

718

1,136

348

487

Repair Cost

2,831

478

1,973

718

1,535

1,460

1,356

34

25

88

38

54

80

42

Insurance expenses
Trust fees
Other lease business expenses

303

303

303

303

303

303

303

1,174

748

4,115

735

1,756

2,250

2,013

(4) NOI(＝(2)-(3))(thousand yen)

28,0987,481

39,05317,014

18,39862,366

16,785(5) Depreciation(thousand yen)

8,964

3,157

14,905

6,251

7,395

14,856

5,357

19,133

4,323

24,148

10,763

11,00347,50911,428

6,154

1,060

464

-

770

2,899

581

21,943

6,421

38,58917,014

17,62759,466

16,204(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)52

Income and Expenditure by Property (6)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Other regional cities（２）Property No.

B-07
S-FORT Yokkaichi（３）Property name

（５）
Price
information（６）
Leasing
information

Aug-02, 2016

1,050

Apr-15, 2015

375

987

S-FORT Nihonbashi

S-FORT Itabashi

Hakozaki

ShimuraJul-01, 2015

Jul-01, 2015
925

S-FORT Shiomi
Jul-01, 2015

1.1

3.7

2.3

3.6

1.6

1.0

2.1

(million yen)

683

1,085

388

988

954

654

883

645

866

Total rentable area(㎡)

2,192.48

4,972.84

1,507.35

1,609.80

1,114.38

1,119.54

1,042.48

Leased area(㎡)

2,161.95

4,972.84

1,507.35

1,564.75

1,090.38

1,052.09

1,022.47

Occupancy rate

(%)

98.6

100.0

100.0

97.2

97.8

94.0

98.1

184

184

184

184

184

184

184

26,94136,14912,89532,29327,443

21,30429,433

Real estate rental revenues

23,56735,533

12,646

29,57523,65919,95026,510

Other lease business revenues

3,373

616

248

2,717

3,783

1,354

2,922

5,933

3,780

1,452

9,077

6,659

4,606

5,527

(3) Regal estate rental expenses(thousand yen)expenses

Aug-02, 2016

C-04

(%)

(thousand yen)

information

S-FORT Maita Koen

IdaimaeC-03(million yen)

Balance sheet amount630

S-FORT Saga

C-02

Composition rate(2) Total real estate rental income

Income andAug-02, 2016

C-01

Acquisition price(1) Number of operating days

（７）

B-09

S-FORT Saga Honjo

Nishishinchi（４）Acquisition date

Greater Tokyo area

B-08

Management service fee

1,511

-

-

2,350

1,630

1,398

1,649

Taxes and dues

1,418

3,020

961

2,243

1,291

1,301

1,349

Utilities expenses

883

-

-

357

405

253

472

1,042

360

157

1,533

1,507

814

898

36

86

23

53

36

32

40

Repair Cost
Insurance expenses
Trust fees
Other lease business expenses

-

303

303

303

405

405

405

1,041

9

6

2,234

1,382

399

712

(4) NOI(＝(2)-(3))(thousand yen)

21,00732,368

11,442

23,216

20,783

16,69823,905(5) Depreciation(thousand yen)

6,114

13,891

4,584

8,406

5,121

4,144

6,093

14,893

18,477

6,858

14,80915,662

12,554

17,811

684

1,161

-

134

3,176

-

-

20,32331,207

11,442

23,081

17,606

16,69823,905(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)53

Income and Expenditure by Property (7)Fiscal Period Ending January 2018 (As of January 31, 2018)（１）Area category

Greater Tokyo area（２）Property No.

C-05（３）Property name

S-FORT Noborito（４）Acquisition dateJul-01, 2015

（５）
Price
information（６）
Leasing
information

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

Jul-01, 2015

S-FORT Sagamihara

Aug-02, 2016809

Aug-02, 2016

1.2

1.2

2.0

0.7

1.6

1.1

858

741

1,157

831

891

600

Total rentable area(㎡)

1,022.10

1,717.46

1,397.64

1,726.56

1,255.90

1,492.09

1,198.26

Leased area(㎡)

995.75

1,614.75

1,308.90

1,643.68

1,234.08

1,492.09

1,152.79

Occupancy rate

(%)

97.4

94.0

93.7

95.2

98.3

100.0

96.2

184

184

184

184

184

184

184

21,31131,80625,80438,40327,096

29,64019,97820,43630,066

23,791

34,292

26,022

29,52019,222

875

1,739

2,012

4,110

1,074

120

755

4,090

5,627

5,658

6,698

5,996

3,740

4,952

Management service fee

1,321

1,857

1,615

1,891

2,208

1,417

1,429

Taxes and dues

1,083

1,904

1,356

1,381

1,504

2,284

1,332

Utilities expenses

229

202

185

595

721

-

421

Repair Cost

299

455

1,166

1,473

313

-

767

(thousand yen)

1,130

S-RESIDENCE
Yokosuka Chuo

4.5(3) Regal estate rental expenses

732

S-FORT Ichikawa

674

Other lease business revenues

818

S-FORT Maihama

C-11(million yen)

Real estate rental revenues

information

Nishifunabashi

C-10

(%)

(thousand yen)expenses

S-FORT

Hiratsuka

C-09(million yen)

(2) Total real estate rental income

Income and

S-FORT Shonan

C-08

Composition rate
Balance sheet amount

666

C-07

Acquisition price(1) Number of operating days

（７）

C-06

850

585

Insurance expenses

31

43

34

45

39

34

27

Trust fees

405

405

405

405

405

-

202

719

759

895

906

804

4

771

(4) NOI(＝(2)-(3))

Other lease business expenses(thousand yen)

17,221

26,17820,14631,70421,09925,89915,026(5) Depreciation(thousand yen)

4,712

6,467

6,169

6,904

3,733

7,673

4,441

12,50819,71013,977

24,79917,366

18,226

10,585

-

-

2,447

5,928

887

-

524

17,221

26,178

17,69825,776

20,21225,89914,502(6) Real estate rental income（＝(4)-(5)）(thousand yen)
(7) Capital Expenditures(thousand yen)(8) NCF（＝(4)-(7))(thousand yen)54

Financial Documents: Balance Sheet (1)(Unit：thousand yen）
Privious Fiscal Year

(Unit：thousand yen）

Current Fiscal Year
(January 31, 2018)(July 31, 2017)

Privious Fiscal Year

Current Fiscal Year

(July 31, 2017)(January 31, 2018)

AssetsCurrent Assets
Cash and deposits

649,743

680,374

Investments and other assets

Cash and deposits in trust

991,688975,119

Investment securities

250,000

Operating accounts receivable

5,175

4,349

Lease and guarantee deposits

10,455

10,428Prepaid expenses

67,97966,944Long-term prepaid expenses

83,00881,490Consumption tax receivable

00deferred tax assets

15

11

Other
Total-current assets

132

36,0101,714,734

1,762,811

Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Tools, furniture and fixtures

343,463351,436

53,771,943

53,408,675

Investment unit issuance expenses

18,632

13,942

Investment corporation bond issuance costs

20,18816,805

Total non-current assets
deferred assets

Total deferred assets
2,204,081

2,212,968-50,553-76,006

2,153,527

2,136,961

686

1,849

Accumulated depreciation

-136

-268

Tools, furniture and fixtures, net

549

1,580

Land

1,523,123

1,524,232

Buildings in trust

29,829,883

29,865,892

Accumulated depreciation-1,413,203-1,806,912

Buildings in trust, net

28,416,680

28,058,979

7,638

13,251

Structures in trust

Total investments and other assets

Accumulated depreciation

-131

-555

Structures in trust, net

7,507

12,695

Machinery and equipment in trust

468,125

469,744

Accumulated depreciation-41,580-52,884

Machinery and equipment in trust, net

426,544416,860

Tools, furniture and fixtures in trust

24,41532,580

Accumulated depreciation-3,473-6,255Tools, furniture and fixtures in trust, net

20,942

26,325Land in trust

20,879,603

20,879,603

Total property, plant and equipment

53,428,479

53,057,238

259,518

Total Assets

38,82130,74855,525,499

55,202,235

55

Financial Documents: Balance Sheet (2)(Unit：thousand yen）
Privious Fiscal Year

Current Fiscal Year

(July 31, 2017)(January 31, 2018)

Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable

94,166116,336

400,000

200,000

5,000,000

2,500,000

Accounts payable – other

17,58819,094

Accrued expenses

6,512

6,405

Accrued dividend

9,616

8,603

Accrued consumption taxes

8,001

3,581

Current portion of long-term loans payable

Income taxes payable
Advances received
Deposits received
Total current liabilities

699

675

258,657

262,856

4,792

4,532

5,800,034

3,122,085

Non-current liabilities
Investment corporation bonds

1,000,000

1,000,000

Long-term loans payable

22,200,000

24,700,000

30,53829,907

Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Total non-current liabilities
Total Liabilities

232,324

223,281

23,462,862

25,953,188

29,262,896

29,075,273

26,015,517

26,015,517

Net assets
Unitholdersʼ equity
Unitholdersʼ capital
Amount deducted from Unitholders' capital-366,930-508,713

25,648,587

25,506,804

Unappropriated retained earnings

614,015

620,156

Total surplus

614,015

620,156

26,262,602

26,126,961

Total net assets

26,262,602

26,126,961

Total liabilities and net assets

55,525,499

55,202,235

Unitholdersʼ capital (Net amount)Surplus

Total unitholdersʼ equity

56

Financial Documents：Statement of Income(Unit：thousand yen）
Privious Fiscal Year

Current Fiscal Year

(July 31, 2017)(January 31, 2018)

Operating revenue
Rent revenue - real estate
Other lease business revenues
Silent partnership revenue

1,686,773

1,681,707

153,721

135,508-

17,764

1,840,495

1,834,981

Expenses related to rent business

838,806

803,495

Asset management fee

127,808

129,063

Total operating revenue
Operating expenses

Asset custody fee

4,941

4,926

Administrative service fees

35,814

36,160

Directorsʼ compensations

2,400

2,400

Remuneration for Accounting Auditors

10,00010,000

Other operating expenses

61,605

59,111

Total operating expenses

1,081,377

1,045,157

759,118

789,823

Interest income

32Interest on refund

88-

Total non-operating income

912Interest expenses

99,225

101,580

Interest expenses on investment corporation bonds

3,864

3,864

Borrowing related expenses

33,35455,492

Amortization of investment unit issuance expenses

4,613

4,690

Amortization of investment corporation bond issuance costs

3,327

3,383

144,385

169,011

Operating income
Non-operating income

Non-operating expenses

Total non-operating expenses
Ordinary income

614,824

620,814

Net income before income taxes

614,824

620,814

Income taxes – current

920

842

Deferred Income taxes

-

3

921

846

613,902619,968

Total income taxes
Net income
Balance brought forward
Unappropriated retained earnings (-)

112

188

614,015

620,156

57

Financial Documents：Statement of Cash Flows(Unit：thousand yen）

(Unit：thousand yen）

Privious Fiscal Year

Current Fiscal Year

Privious Fiscal Year

Current Fiscal Year

(July 31, 2017)(January 31, 2018)(July 31, 2017)(January 31, 2018)

Cash flows from operating activities

Cash flows from investing activities

Net income before income taxes

614,824

620,814Purchase of property, plant and equipment-7,788-11,158

Depreciation

434,869

433,805

Purchase of property, plant and equipment in trust-29,826-45,508-3-2

103,089

105,445

4,613

4,690

3,327

3,383

Decrease (increase) in operating accounts receivable

2,632

825

Decrease (increase) in consumption taxes receivable

61,006-

Interest income
Interest expenses
Amortization of investment unit issuance expenses
Amortization of investment corporation bond issuance
costs

Payment for lease and guarantee deposits
Proceeds from collection of lease and guarantee

-10

-

-

27

Repayments of lease and guarantee deposits received-1,547-1,891

Proceeds from lease and guarantee deposits received

1,638

1,260

-29,654-23,256

22,55914,214

deposits

Repayments of lease and guarantee deposits in trust
received
Proceeds from lease and guarantee deposits in trust
received

Decrease (increase) in consumption taxes payable

8,001-4,420Decrease (increase) in prepaid expenses-1,019

1,035

Increase (decrease) in operating accounts payable-31,824

16,273

Cash flows from investing activities

Increase (decrease) in accounts payable – other-9,012

1,505

Cash flows from financing activities

Increase (decrease) in advances received

2,015

4,198

Increase in short-term bank loans

400,000-

Decrease (increase) in long-term prepaid expenses

30,088

1,518

Decrease in short-term loans payable-550,000-200,000

Proceeds from long-term loans payable

Other, net
SubtotalInterest income received
Interest expenses paid
Income taxes – current
Cash flows from operating activities

2,958-52,515

1,225,567

1,136,556

3

2-102,877-105,552-1,287-2,254

1,121,405

1,028,752

Purchase of investment securities
Proceeds from redemption of investment securities

Proceeds from issuance of investment corporation
bonds-250,000

-

1,712

8,246

-292,915-58,067-2,500,000--2,500,000

Proceeds from issuance of investment units-742,638-756,622

Dividends paid

-892,638-956,622-64,148

14,062

Net increase (decrease) in cash and cash equivalents

Cash flows from financing activities

1,705,580

1,641,431

Cash and cash equivalents at the beginning of period

1,641,431

1,655,494

58

Unitholder Information (1)Number of Units and Number of Unitholders by Unitholder Type
Number of units by unitholder type and number of unitholders by unitholder typeEnd of 5th period

Financial Instiitutions

Other domestic

Overseas(January 31,(including financial dealers)

corporations

investors

2018)

102,851 units

36,482 units

9,604 units[36.3%][12.9%][3.4%]

283,000 units

0%

10%

20%

30%

40%

50%

Individuals / Other
134,063 units[47.4%]

60%

70%

80%

90%

100%

Number of unitholders
by unitholder type

As of July 31,
2016

As of January
31, 2017

As of July 31,
2017

As of January
31, 2018

51 people

59 people

53 people

51 people

Unitholder Information
Number of units byunitholder type

As of July 31,
2016

As of January
31, 2017

As of July 31,
2017

As of January
31, 2018

53,419 units

88,799 units

95,611 units

102,851 units

Other domestic
corporations

19,699 units

28,285 units

31,195 units

36,482 units

Other domestic
corporations

186 people

262 people

235 people

216 people

Overseas investors

5,590 units

8,038 units

6,730 units

9,604 units

Overseas investors

46 people

53 people

53 people

58 people

Individuals / Other

84,632 units

157,878 units

149,464 units

134,063 units

Individuals / Other

10,999 people 16,906 people 16,725 people 15,493 people

0 units

0 units

0 units

283,000 units

Total

11,282 people 17,280 people 17,066 people 15,818 people

Financial Institutions(including financial dealers)

Total

Financial Institutions(including financial dealers)59

Unitholder Information (2)Major Unitholders
Major Unitholders (top 10) as of January 31, 2018
Investment
Unitholder

units(units)

Ratio（％）

Japan Trustee Services Bank,Ltd.(Trust Account)

21,548

7.61

The Master Trust Bank of Japan,Ltd.(Trust Account)

17,831

6.30

Samty Co., Ltd.

12,374

4.37

Kinki Sangyo Credit Union

12,000

4.24

Daiwa PI Partners Co.Ltd.

10,858

3.83

Trust & Custody Services Bank, Ltd.(Securities)

9,945

3.51

Mitsubishi UFJ Morgan Stanley Securities

6,466

2.28

The Nomura Trust and Banking Co., Ltd.(Trust)

6,030

2.13

Osaka co-sei Shinkin Bank

5,820

2.05

Daido Shinyoukumiai

4,957

1.75

Total of major unitholders(top10)

107,829

38.07

Total of units

283,000

100.0060Change in Investment Unit Price( 30, 2015 to February 28 2018)

Source: Prepared by Samty Asset Management based on Tokyo Stock Exchange, Inc. Database61

Disclaimer
 This document has been prepared to provide information, and not for inviting investments in or recommendingtransaction of certain products. When purchasing the investment units of Samty Residential Investment Corporation,please contact and inquire respective securities companies. Further to the above, we request investors to make final
investment decisions by their own responsibility and judgment.

 This document does not constitute a disclosure document or a management report based on the Financial

Instruments and Exchange Act, the Act on Investment Trusts and Investment Corporations, the listing regulations of
the Tokyo Stock Exchange and other relevant laws and regulations.

 The data and analysis, etc. in this document are based on the actual results of a certain period in the past, and do notguarantee the management results or their fluctuations, etc. in the future. Further to the before mentioned, thecontents of this document include statements on future operating results. Such forward-looking statements do notconstitute a guarantee of future operating results. Furthermore, the investment return of a real estate investment
trust may become lower than the investment principal depending on the fluctuations in the price of the managed realestate properties and their profitability.

 Samty Residential Investment Corporation does not guarantee the accuracy or completeness of the information

provided in this document. In addition, please note that the contents of this document may be changed or removed
without prior notice.

 Neither Samty Residential Investment Corporation nor Samty Asset Management Co., Ltd. bears any responsibility forthe outcome of the investment actions taken in accordance with this document.

 Duplication and reproduction, etc. of the contents contained in this document without prior consent is prohibited.

Inquiries Regarding This Document

Samty Asset Management Co., Ltd.

(Financial instruments business operator (registration No. 2402 issued
by the Director-General of the Kanto Finance Bureau (Kinsho))(Member of The Investment Trusts Association, Japan)
Phone: +81-3-5224-5031

This document is not a disclosure material based on the Financial Instruments and Exchange Act.
We request investors to make final investment decisions based on their own judgment.

62