Samty Residential Investment Corporation（Securities CODE：3459）

Financial Results for the 2nd Fiscal PeriodEnding July 2016
October 2016

Contents
１. Features of Samty Residential Investment Corporation

P.3

２. Financial Overview for the 2nd Fiscal Period

P.7

３. Managing Result

P.11

４. Future Growth Strategy

P.21

５. Operating Results and Distribution Information

P.27

６. Appendix

P.32

2

１. Features of Samty Residential Investment Corporation

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 aims to build a portfolio which pursues stability, growth potential and earning potential by “investing
primarily in residential properties in major regional cities ” and “being supported from the Samty Group.”

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

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

Wide-ranging support of the sponsor
Enhancing value through running a unified
brand

Stable supply of new developed properties(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.

4

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 area, 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 calculated based on the acquisition price.
The above is the target investment mix. Actual portfolio composition
may vary.

5

Portfolio Overview■ Samty Residential has acquired 49 residential properties throughout Japan andsuccessfully composed more stable diversified portfolio concentrating in major
regional cities

Owned properties･･･ ●Investment ratio
by geographical area

New properties acquired at 1st public offering(As of August 2, 2016) ･･･ ■A-21
A-23 ■A-09● A-20A-22■■
A-02●● ■● A-03
B-03■■ A-19●A-10 A-18
B-07 ■●
B-04

Greater Tokyo
Area
17.5%

●A-12
●●A-16
A-11

Kitakanto
Hokkaido

A-13 A-17■ B-05
A-26 ■■●
A-01●■● B-02
●
A-25
A-08

A-24
A-05 ■
●
●A-04
●
B-09■
■
A-06
B-08

1.2%

Kinki
32.0%

Ratio of
5.3%
regional citis
Kyusyu 82.5%

A-27 A-28■
A-14 ●■
A-29
●A-07
A-15■
●

Other
reginal cities
12.2%
15.1%

Tohoku
9.2%

■
B-06
●
B-01

Raito by Building age

C-09
C-03 ●●●C-07C-02 ● ●C-08
C-11
●
●
■
C-05 C-04●C-01● ■C-10
C-06

Tokai
22.7%

Averagebuilding age
7.4%

Major
regional cities
67.4%

Investment ratio by seller

Ratio of average area
per residential unit

Ratio ofsingle andcompact type89.8%

(Note) Asset size, No. of properties, Average building age and Averageappraisal NOI yield are for 49 properties owned as of August 2, 2016.
Occupancy rate is for 29 properties owned as of July 31, 2016

(Note) The above ratio are based on acquisition prices for
49 properties owned as of August 2, 1016.

6

２. Financial Overview for the 2nd Fiscal Period

Summary of Income Statement
Comparison Forecast and Actual Result
Actual result was generally as expected with the increased revenue due to the rise of occupancy rate,
rental unit prices and the key money; the lowered financing costs due to a fall in base interest rate;
the increased investing volume due to value-adding work, etc.

Major factors contributing to difference fromthe actual result of the 1st fiscal period ended
January 2016

(million yen)
2nd Period (July 31, 2016)
1st Period(January 31, 2016)

ChangeForecast

Results(As of March 16,

fromForecast

2016)■Management performance
Operating revenue

1,458

1,085

1,110

+25

(out of which, real estate rental revenue)

1,458

1,085

1,109

+24

Operating expenses

859

661

693

+31

(out of which, real estate rental expenses)

628

507

538

+30

Operating income

598

423

417

-6

Non-operating income and loss

-428

-93

-85

+7

Ordinary income

170

330

331

+1

Corporate tax, etc.

1

1

0

0

168

329

330

+1

1,034 yen

2,017 yen

2,026 yen

+9 yen776 yen574 yen592 yen+18 yen

1,810 yen

2,591 yen (Note2)

2,618 yen

+27 yen

Net income■Distributions(Note1)
Distribution per unit
(Not including distribution
in excess of earnings)・・・①
Distribution in excess of earnings
per unit・・・②

Total distribution per unit ・・・① + ②(Note1) Calculated with the number of investment units issued at 163,340 units.
(Note2) The forecast of distribution per unit of 2nd period at IPO was 2,473yen.
For more details, please refer to “ Change in forecast/actual distribution forecast” on page 29.

Both real estate rental revenue and expenses havedecreased as an irregular fiscal period of 11 months (1st
Fiscal Period) was shifted to a regular fiscal period of 6months (2nd Fiscal Period). On the other hand, ordinary
income was 331 million yen (+161 million yen from the 1st
fiscal period) and net income was 330 million yen (+162
million yen from the 1st fiscal period) in the 2nd Fiscal Period.
While non-operating expenses related to establishment and
IPO were recorded in the 1st Fiscal Period, none of such wererecorded in the 2nd Fiscal Period.

Major factors contributing to difference
Between the forecast and the actual result of the
2nd fiscal period ended July 2016

■ Increase in operating revenue：＋25 million yen
・Increase in rental revenues due to rise inoccupancy and rent unit prices: +2 million yen
・Increase in other revenues (cancellation penalty,
key money, renewal fee, etc.) : +23 million yen■ Increase in operating expenses: -31 million yen
・Increase in repair expenses
due to value-adding work, etc.: -9 million yen
・Increase in depreciation: -8 million yen
・Increase in other expenses(leasing promotion expenses, etc.) : -13million yen■ Non-operating income and expense: +7 million yen
・Decrease in interest expenses due to the decreasein base rates: +5 million yen
・Other non-operating income and expense: +2 million yen【Average occupancy rateduring 2nd period】
Forecast：
94.6%
Actual result：95.3%【Capital expenditures】
Forecast：28 million yen
Actual result：8 million yen

8Comparison of Forecasted Distribution with Actual Result
Comparison between the forecast and the actual results of the 2 nd fiscal period(million yen)
Operating revenue+25(+154 yen)

Operating expenses-31(-192 yen)

460

Other
repairexpenses
+1

450
440

Other
income+5

Renewal fee+2
Cancellation
penalty+3

430 Total distributions

410

Decrease inutilities
expenses+3(+21 yen)

Key money+8423（2,591 yen）

420

Non-operating Distribution inincome andexcess of
expenseearnings+7+2(+45 yen)(+18 yen)Repair
Income+2

Increase in
Increase in other revenues
rental revenues+22
due to rise(+139 yen)in occupancy
andrent unit prices+2(+15 yen)400

2nd Period
Forecasted Distribution

Value-addingwork+8

Distribution inexcess of earnings
Total distributions
per unit427+2(2,618 yen)(+18 yen)

Increase inrepairexpenses etc.
-9(-57 yen)

Increase in
RepairExpenses-14(-86 yen)

Increase in
otherExpenses-2(-15 yen)

Other+2
Increase in
distribution inexcess of
earnings
in line with
Increase in
Increase in
Increase inincrease in
selling, general non-operating
depreciation
Depreciation
andincomeand+2-8administrative expenses etc.
(+18 yen)(-51 yen)expenses+7-0(+45 yen)(-2 yen)Decrease ininterest
expenses+5

Total
Distribution+4(+27 yen)
Distribution
per unit+1(+9 yen)Increase/decrease of
totaldistributions+4(+27 yen)(announced on March 16, 2016)(Note) The above figures are rounded down to the nearest whole number.

2nd Period
Actual Result
93. Managing Result

Financial Overview

Management Summary■Samty Residential has enhanced portfolio stability through expanding its asset size byacquiring properties and proceeding diversification
At IPO

No.of properties+21 properties

No. of properties

28 properties

Acquisition price30,500 million yen

Total acquisition
price+1.7times

External
Growth(As of July 1, 2015)

1st PO(As of August 2, 2016)49 properties
51,551 million yen■Samty Residential has realized stable portfolio operation through an appropriate
management based on track records and experiences
Internal
GrowthAt IPO

Occupancyrate(Note)

End of 1st Period

End of 2nd Period(As of June 30, 2015)(As of January 31, 2016)(As of July 31, 2016)

92.8％

95.2％

95.4％

(Note) The occupancy rate at the time of IPO excluding recently completed S-FORT Tsurumai marks, S-FORT Shonan Hiratsuka and S-FORT
Gakuenmae which was purchased on October 1, 2015. The 20 assets which newly acquired on August, 2016 are also excluding, since those of
the assets were unpurchased at the time of the end of July 2016.

■Samty Residential has established a close relationship with financial institutions ineach region, constructing a solid financial condition through a well-balanced lenderformation.
st
End of 1 Period

Financial
Strategy(As of January 31, 2016)

No. of Financial Institutions

12 banks

Total interest-bearing liabilities

17.1 billion yen

Long-term loan ratio

93.2%

Lenders+3banks
Long-term
debt ratio+3.3
Percentage
points

1st PO(As of August 2, 2016)15 banks
29.2 billion yen
96.5%

12

External Growth

Change in the Portfolio
Portfolio highlight

No. of properties

st

IPO

End of 1st period

End of 2nd period

1 PO(July 1, 2015)(January 31, 2016)(July 31, 2016)(August 2, 2016)28 properties

29 properties

29 properties

49 properties

Total acquisition price30,500 million yen

30,962 million yen

30,962 million yen

51,551 million yen

Appraisal value

30,936 million yen

32,434 million yen

32,975 million yen

54,956 million yen

Appraisal NOI yield

5.6%

5.6%

5.6%

5.6%

Average building age

7.0 year

7.6 year

8.1 year

7.4 yearOccupany rate

92.8%

(Note1)

95.2%

95.4%

No. of rentable units

2,297 units

2,345 units

2,345 units

96.5%(Note2)

3,754 units(Note1) The occupancy rate is the figure as of the end of July 2015 and excluding recently completed S-FORT Tsurumai marks, S-FORT Shonan Hiratsuka and
S- FORT Gakuenmae which was purchased on October 1, 2015.
(Note2) The Occupancy rate after 1st PO is calculated based on the average of the occuupancy rate as of July 31, 2016 for the 29 properties owend at the 2nd period and as of April 30, 2016 forthe 20 properties which purchased on August 1, 2016 and August 2, 2016., excluding S-FORT Tsurumai arts and S-FORT Tsurumai cube which are recently completed. The occupancy
rate including these 2 properties are 94.9%.

Major owned properties

S-RESIDENCE
Shin Osaka Ekimae

S-RESIDENCE
Esaka

S-RESIDENCE
Kobe Motomachi

S-RESIDENCE
Yokosuka Chuo

13

External Growth

Overview of Public Offering in August 2016
Overview of public offering

List of newly acquired properties
Acquisition

Property

Property Name

numberAppraisal

price

value

(million yen)(million yen)

Acquisition

Property

Property Name

numberAppraisal

price

value

(million yen)(million yen)

Other Regional Cities

Major Regional Cities
A-17

S-RESIDENCE Shin Osaka Ekimae

2,489

2,650

B-05

S-RESIDENCE Esaka

2,323

2,490

A-18

S-FORT Aoi 1-Chome

1,080

1,120

B-06

S-FORT Utsunomiya

612

640

A-19

S-FORT Aoi

870

973

B-07

S-FORT Yokkaichi Nishishinchi

630

701

S-FORT Saga Honjo

1,050

1,070

S-FORT Saga Idaimae

375

394

A-20

S-FORT Kurumamichi

400

423

B-08

A-21

S-FORT Kamiotai

720

735

B-09

A-22

S-FORT Tsurumai arts

680

753 Greater Tokyo Area

A-23

S-FORT Tsurumai cube

570

631

C-10

S-RESIDENCE Yokosuka Chuo

850

910

A-24

S-FORT Fukuoka Higashi

1,900

2,010

C-11

S-FORT Sagamihara

585

604

20,58921,981

A-25

S-RESIDENCE Kobe Motomachi

1,200

1,320 Total

A-26

S-FORT Kobe Kaguracho

1,858

2,090

A-27

S-FORT Nijo-jo mae

812

842

A-28

S-FORT Chion-in mae

500

515

A-29

S-FORT Miyamachi

1,085

1,110

20 properties

14

External Growth

Property acquisitions in August 2016
Acquired properties for 20.5 billion yen located primarily in
Major Regional Cities under the theme of stability and expansion of asset size
■ S-RESIDENCE Yokosuka Chuo

A domitory provided as part ofwelfare offerings of a corporaton,andthat has sigle type units with a day
nursery for its employees.

Secured stable earnings by investing inproperties within a commutable area tocore offices, medical or educational
facilities such as national universities in
the area and by adopting the fixed rentmaster lease (ML).

■ Close to universities
Fixed-rent ML

S-FORT
Saga Honjo

Fixed-rent ML

Fixed-rent ML■ Close to medical institutions

S-FORT
Chion-in mae

S-FORT
Saga Idaimae

S-FORT
Tsurumai cube

S-RESIDENCE
Kobe Motomachi

15

Internal Growth

Changes in the Occupancy Rates by Area
Occupancy rate for the entire portfolio has risen 2.6% from the time of
IPO. Currently it stably keeps around 95%.
（％）

Began managementwith 28 properties
On July 1, 2015

100.0
99.0
98.0
97.0
96.0
95.0
94.0
93.0
92.0
91.0
90.0
30-Jun31-Jul31-AugMajor regional cities

30-Sep31-Oct30-Nov

1st Fiscal Period (January 31, 2016)

Other regional cities

31-Dec31-Jan29-FebGreater Tokyo area

31-Mar30-Apr31-MayWhole portfolio

30-Jun31-Jul

2nd Fiscal Period （July 31, 2016)(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. (From end of June 2015 to end of August 2015 is excluding recently completed S-FORT Tsurumai marks, S-FORT Shonan Hiratsuka and S-FORT
Gakuenmae which was purchased on October 1, 2015. September 2015 is including S-FORT Tsurumai marks and S-FORT Shonan Hiratsuka, excluding S-FORT
Gakuenmae. The 20 assets which newly acquired on August 1, 2016 and August 2, 2016 are also excluding, since those of the assets were unpurchased at thetime of the end of July 2016.

16

Internal Growth

Changes in unit rent after adjustment
Unit rent after adjustment of the entire portfolio and earning capability
including key money revenue have remained stable.
（％）

Began managementwith 28 properties
On July 1, 2015

Major regional cities

Other regional cities

Greater Tokyo area

Overall

102.0
101.0
100.0
99.0
98.0
30-Jun31-Jul31-Aug30-Sep31-Oct30-Nov

31-Dec31-Jan29-Feb

1st Fiscal Period (January 31, 2016)

30-Apr31-May30-Jun31-Jul

2nd Fiscal Period （July 31, 2016)

1st Fiscal Period (January 31, 2016)

Rent unit price after adjustment
End of June 2015 = 100

31-Mar

2nd Fiscal Period （July 31, 2016)30-Jun 31-Jul 31-Aug 30-Sep 31-Oct 30-Nov 31-Dec 31-Jan 29-Feb 31-Mar 30-Apr 31-May 30-Jun 31-Jul

Major regional cities

100.0

100.0

100.1

100.1

100.2

100.2

100.1

100.2

100.1

100.3

100.3

100.4

100.5

100.4

Other regional cities

100.0

100.0

99.8

99.8

99.9

99.8

99.7

99.8

99.7

99.9

99.7

99.7

99.8

99.8

Greater Tokyo area

100.0

100.0

99.8

99.8

99.8

99.8

100.0

100.1

100.1

100.3

100.4

100.4

100.5

100.5

Whole portfolio

100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.1 100.1 100.2 100.3 100.3 100.4 100.4(Note) Unit rent after adjustment are 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

17

Financial Strategy

Financial highlight
Change in financial Status
End of 1st
periodTotal interest-bearing
17.1 billion yen
debt

1st POEnd of 2nd
period(August 2, 2016)17 billion yen

29.2 billion yen

The latest date(August 31, 2016)28.7 billion yen

Average remaining
borrowing period

3.4 year

3.0 year

3.2 year

3.2 year

Ratio of long-term
debt

93.2%

94.1%

96.5%

98.1%

Total asset based
LTV(Note)

50.6%

50.6%

52.5%

51.7%

Status of Maturity ladder

Breakdown of theinterest-bearing debt(August 31, 2016)
The first investment corporation
bonds (private)(million yen)

Total issue amount: 1 billion yen
Maturity: 4 years
Financial agent: Shinsei Bank, Limited
Underwriter: DBJ Securities Co., Ltd.

Repaind as a early repayment
on August 31, 2016

(Note) The total asset based LTV at the time of 1st PO and the most recent date is the forecast, interestbearing debt is divided by total assets (adding incidental expenses in line with 20 properties that
newly acquired on August 1, 2016 and August 2, 2016 (assumption at the present time), and thetotal acquisition price including the consumption taxes.) to total assets as of end of 2nd period.

Regional
banks
53.2％

(billion yen)18

Appraisal Value Status (1)Summary of Appraisal Value
1st fiscal period

Book value
Acquisition End of 2nd
No. ofprice

periodproperties (million yen) (as of July
(Note1)

31, 2016)(million yen)

IPO
(July 10, 2015) (Note1)

End of interim period

End of 1st period（August 31, 2015) (Note1)(January 31, 2016)

1st PO(August 2, 2016) (Note3)

AppraisalCap

AppraisalCap

AppraisalCap

Appraisal

Cap

value

Rate

value

Rate

value

Rate

value

Rate

(million yen)（％）(Note2)(million yen)（％）(Note2)(million yen)（％）(Note2)(million yen)（％）(Note2)【Properties acquired through the
1st Fiscal Period】
Major regional cities

16

20,607

21,545

20,451

5.5

20,8795.4

21,675

5.3

22,002

5.2

Other regional cities

4

2,777

2,930

2,861

6.1

2,885

5.9

2,935

5.8

2,951

5.8

Greater Tokyo area

9

7,578

7,865

7,624

5.0

7,719

4.9

7,824

4.8

8,022

4.8

29

30,962

32,34130,936

5.4

31,483

5.3

32,434

5.2

32,9755.1

Major regional cities

13

14,164

-

-

-

-

-

-

-

15,172

5.0

Other regional cities

5

4,990

-

-

-

-

-

-

-

5,295

5.3

Greater Tokyo area

2

1,435

-

-

-

-

-

-

-

1,514

5.4

Subtotal

20

20,589

-

-

-

-

-

-

-

21,981

5.1

Total

49

51,551

32,34130,936

5.4

31,483

5.3

32,434

5.2

54,956

5.1

Subtotal【Properties acquired through PO in
August 2016】(Note1) Acquisition price at the 1st fiscal period includes the acquisiotn price for S-FORT Gakuenmae (462 million yen) acquired on October 1, 2015.
However, appraisal values for at IPO and end of interim period for 1st period do not include the appraisal value of the property.
(Note2) Cap Rate is calculated with the weighted average using the cap rate as per the direct capitalization method of the appraisal reports.
(Note3) The figures for properties acquired through PO in August 2016 are based on real estate appraisal reports at time of acquisition on May 1, 2016.

19

Appraisal Value Status (2)Changed in appraisal value of properties
acquired in the 1st Fiscal Period through the end of the 2 nd Fiscal Period■ Change of appraisal value at end of 2nd period with those at
IPO and at end of 1st period
No. of properties

Compared toCompared to

end of 1st

IPO

period■ Change in appraisal value of properties
acquired in the 1st fiscal period(Note1)

Change inappraisal value

Upward26

22

Unchanged

0

2

2

5

(Note2)

Downward(Note) The figure for the end of 1st period includes S-FORT Gakuenmae acquiredon October 1, 2015.
(Note2) Reasons for the decline in appraisal value for each property are as follows.
A-09 S-FORT Tsurumai marks・・・-0.9% compared to end of 1st period.
Actual amout of fixed asset tax finalized.
A-12 S-FORT Hokudai Mae・・・-0.3% compared to end of 1st period.
Benefit of property tax relief decreased.
A-14 S-FORT Kyoto Nishioji・・・-0.9% compared to end of 1st period.
Expense increased due to introdution of internet service
B-01 S-FORT Shjizuoka Hondori・・・-1.6% compared to end of 1st period.
Assumption for occupany rate for the area
reviewed.
B-04 S-FORT Suzuka・・・-1.8% compared to end of 1st period.
Depreciable tax recorded in line with the acquistion.

Changed in Cap Rate of properties acquired in
the 1st Fiscal Period through the end of the 2nd Period■ Change of Cap Rate at end of 2nd Period with■ Change in Cap Rate of properties
acquired in the 1st fiscal period

those at IPO and at end of 1st Period

No. of properties

Compared to
IPO

Change in
Cap Rate

Compared to
end of 1st
period(Note1)

Upward00Unchanged

0

12Downward(Note2)2817(Note1) Cap rate at the end of 1st Period is calculated with S-FORT
Gakuenmae acquired on October 1, 2015 included.
(Note2) Cap Rate has declined due to the rise in appraisal value.

(Note) Cap Rate is rounded off to one decimal place.

204. Future Growth Strategy

Growth Strategy・Managed Target
Expand the asset size and enhance the quality of the portfolio throughcontinuous acquisitions of the “S-RESIDENCE” properties developed by thesponsor
Acquire properties through sponsor support

1

External
growth strategy

2
34

Acquire properties by taking advantage of the proprietary channels of theasset management company
Implement the differentiated portfolio development policy

2

Enhance the asset value and rate of return through reviewing existing
facilities and other measures
Reduce operating costs

3

Stabilize earnings by utilizing sublease agreement

1

Lengthen borrowing periods and reduce cost of debt

2①

Expand the bank formation3

Acquire credit ratings in the futureInternal
growth strategy

1

Financialstrategy

Change in Asset size・Management Target (Based on acquisition price)
150.0
100.0
50.0
0.0
(billion yen)

20.5

51.5

Assets at IPO Asset acquired Assets at end

AssetsAssets at the(28 properties) in 1st Periodacquiredmost recent

30.5

0.4

(S-FORT
Gakuenmae)

30.9

of 1st Period(29 properties) through PO in
Aug. 2016(20 properties)

date(49 properties)

Target of managed
assets:achieving the asset
size of 100 billion yen
within three years from theIPO (June 2015)

100

Target ofManagedassets size
22External Growth

Pipeline (Properties of which exclusive negotiating rights were granted andproperties under the negotiation for acquisition)

Properties in development by the sponsor,■ granted exclusive negotiating rights

Properties in development and ownedby the sponsor considered for acquisition(including scheduled to acquire)

S-RESIDENCE Midoribashi SF

Higashinari-ku, Osaka148

Sep-16

Major regional cities

S-RESIDENCE Fukaebashi EAST

Higashinari-ku, Osaka144

Jan-17

Major regional cities③

S-RESIDENCE Shin Osaka WEST

Yodogawa-ku, Osaka224

Feb-17

Major regional cities④

S-RESIDENCE Miyakojima

Miyakojima-ku, Osaka120

Jul-17

Major regional cities⑤

S-RESIDENCE Nagoya Chiyoda

Naka-ku, Nagoya

109

Aug-17

Major regional cities⑥

S-RESIDENCE Minami Horie

Nishi-ku, Osaka154

Sep-17

Major regional cities⑦

S-RESIDENCE Kikawa Higashi

Yodogawa-ku, Osaka187

Dec-17

Major regional cities⑧

S-RESIDENCE Esaka Tarumicho

Suita-shi, Osaka75

Jun-17

Other regional cities⑨

S-RESIDENCE Yokohama Tammachi Kanagawa-ku, Yokohama

36

Oct-16

Greater Tokyo area⑩

S-RESIDENCE Kawasaki Kaizuka

Kawasaki-ku, Kawasaki

43

Feb-17

Greater Tokyo area⑪

S-RESIDENCE Nihombashi Nakasu

Chuo-ku, Tokyo116

Oct-17

Greater Tokyo area⑫

S-RESIDENCE Shinjyuku

Shinjuku-ku, Tokyo

65

Jan-18Greater Tokyo area⑬

S-RESIDENCE Matsudo Honcho

Matsudo-shi, Chiba

52

Mar-18Greater Tokyo area

Scheduledof units completion date

1,473

■ Properties owned by the sponsor considered
for acquisition(including scheduled to acquire)
NumberArea

Location① Yodogawa-ku, Osaka54

Sep-02Major regional cities② Aoba-ku, Sendai

66

Oct-07

Major regional cities③ Toyohira-ku, Sapporo

63

Mar-08Major regional cities
Other regional cities① Showa-ku, Nagoya

56

Jan-17

Major regional cities② Naka-ku, Nagoya

84

Feb-18Major regional cities③ Chuo-ku, Niigata

83

Feb-18Other regional cities④ Nishi-Tokyo-shi, Tokyo

60

Mar-07

Grater Tokyo area

Total: 4 properties

283

Prefectures where the 49 owned properties are located

Area

②

■Properties owned by the third
party, considered for acquisition
NumberScheduledof units completion date①

Total: 13 properties

Location

NumberLoation

Property Nameof units

Completion dateArea

④ Tsu-shi, Mie62

Feb-06⑤ Oita-shi, Oita90

Dec-06

Other regional cities⑥ Chuo-ku, Kumamoto

91

Jan-08Other regional cities⑦ Nishinomiya-shi, Hyogo

102

Mar-09Other regional cities⑧ Machida-shi, Tokyo45

Feb-08Greater Tokyo area

⑨ Funabashi-shi, Chiba

117

Mar-08Greater Tokyo area

⑩ Kawaguchi-shi, Saitama

70

Aug-16

Greater Tokyo area

Total: 10 properties

760(Note) Acquisition of any properties described on this page has not been decided as of the date of this document.

23

Internal Growth

Leasing Activities / Examples(1) Promoting leasing by using model units

Setting up model units of leasing properties. Presenting ideas of actual
living in the unit to prospective tenants to have them sign up at an early stage■ Presenting ideals of actual living in theunit to prospective tenants.

A-10 S-FORT Rokuban-cho

・Make easier to guide prospective tenants to theunits.
・Acquire signing up at an early stage by presenting
ideas of actual living in the unit to prospective
tenants.
・The number of inquiry from prospective tenants
have been increased by appealing the picture ofmodel units through internet advertisement.

A-16 S-FORT Gakuenmae■ Period before sign-ups
after introduction of model units

B-01 S-FORT Shizuoka Hondori24

Internal Growth

Examples of cost reduction/improvement of profitability
Building up profit through various cost-cutting measuresand profitability improvement measures■ Reduction of management costs by reviewing contracts with BM companies (Note1)
Reducing costs by around 1.15 million yen (annual) in the 2nd Fiscal Period by reviewing management
specifications and management costs stipulated in the contracts with BM companies.

【Examples of review of management specifications】
・ Reviewing the frequency of inspection of the mechanical parking facility(4 times/year → 3 times/year)
・ Reducing management cost used as lease/rental fees by reviewing part of lease/rental contracts(rental mats, etc.) and changing it to self-management■Additional installment of motorcycle parking andconversion of parking

Enhancing convenience by additionally installing motorcycle
parking in vacant spaces of common-use areas; andimproving profitability by converting low utilized monthly
parking into coin-operated parking.
 Introduction of coin-operated parking at
A-08 S-RESIDENCE Namba Briller■ Reduction of utilities expenses by introducing
LED lighting

Reducing utilities expenses at the following properties byintroducing LED lighting(Note1) BM companies(building management company): Companies that conduct management such as cleaning, hygiene, equipment and security of properties.
(Note2) The reduced amounts are predicted figures calculated based on actual figures of monthly electricity consumption before and after the introduction of LED lighting.

25

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

Acquire credit ratings in the future26

5. Operating Results and Distribution Information

Management Forecast of the 3rd and the 4th Fiscal Period(million yen)
Operating revenue
Real estate rental revenue
Operating expenses
Real estate rental expenses

3rd fiscal period

4th fiscal period

Increase and(January 31, 2017)(July 31, 2017)

decrease

Assumptions

1,790

1,791

+1

1,790

1,791

+1

955

1,051

+96

768

815

+47

256

257

+1

71

117

+46

440

440

0

1,021

975

-46

187

235

+48

76

127

+51

110

108

-2

834

740

-94

-251

-150

+101

582

589

+7

1

1

0

581

588

+7

2600 yen2625 yen+ 25 yen2056 yen2081 yen+25 yen544 yen544 yen-Miscellaneous
rentalexpenses
Taxes anddues
Depreciation
Real estate rental income
Other operating expenses
Assetmanagement
fees
Other
expenses
Operating income
Non-operating income and loss
Ordinary income
Corporate tax, etc.
Net income
Distribution per unit
Distribution per unit
(Not including distribution
in excess of earnings)
Distribution in excess of earnings per unit

■ Calculation period
The 3rd fiscal period：
August 1, 2016 to January 31, 2017
The 4th fiscal period：
Feburary 1, 2017 to July 31, 2017
■ Assets
The 3rd fiscal period：49 properties
The 4th fiscal period：49 properties(Number of acquired properties
as of the date of this document）■ Period averagemonth-end occupancy rate
The 3rd fiscal period：95.4%
The 4th fiscal period : 95.2%■ Balance of interest-bearing debt
at end of period
The 3rd fiscal period：28,750 million yen
The 4th fiscal period：28,750 million yen■ No. of outstanding units
The 3rd fiscal period： 283,000 units
The 4th fiscal period： 283,000 units(Number of investment units issued andoutstanding as of the date of this document)■ Capital expenditures (planned amount)
The 3rd fiscal period : 42 million yen
The 4th fiscal period： 42 million yen

28Outlook of Distribution
Change in forecast/actual distribution(yen)Change in distribution at normal periods

Increase of
152 yen(+6.15%)29

Distribution Policy (1) Due to the characteristics nature of the portfolio, the ratio of depreciation to property acquisition price tends
to be large, Samty Residential aims to increase fund efficiency through optimal fund allocation andimprovement of unitholder value over the medium to long term.
 In regards to the 3 rd and the 4 th Fiscal Period, Samty Residential determined that it is appropriate to conduct
distributions in excess of earnings in consideration of the market environment and financial conditions.
 Amount of distribution amount 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 capitaland such, in accordance with the situations of the time.

Cash will be allocated based on a comprehensive review of the external economic
environment, real estate market 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
Reinforcement of the financial base by
reducing interest-bearing liabilities, etc.

Investment that should help enhance
the portfolioʼs profitability enhance
30

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 ofearnings, 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(1) Determination of distributions
With a view to enhancing unitholder value over the
medium to long term, distributions in excess of earnings
are authorized when Samty Residentialʼs portfolio meetsthe right conditions.

Expenses related torent business, sales,
general andadministrative
expenses, nonoperating expenses,
etc.

Rentalrevenue

Total
appraisalvalue(2) Determination of amountCAPEX for thefollowing fiscal
periodTotal adjusted
book value(Note)
Note: Excluding amount equivalent to incidental expenses
upon acquisition

Amount of distributions (including distributions in excess of earnings) aredetermined for each fiscal period based on future capital expenditures, capitaldemand, etc.

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

Depreciation
Distribution inexcess of earnings

Net income before
income taxes

Distribution(profits)

Distribute payout ratio aimingfor 70%However, distributions in excess of earnings will be
up to 35% of depreciation

31

６. Appendix

Characteristics of Regional Residence Investments
Household growth rate
(Year 2000 = 100%)

Growth rate from2000 to 2014＋19.8%

Number of New Housing Starts(Year 2000＝100%）（%）＋17.8%＋22.5%＋18.2%＋16.7%＋12.5%＋16.1%＋15.6%＋14.9%＋25.9%
Source: Prepared by Sumitomo Mitsui Trust Research Institute based on “Basic
Resident Registers,” Ministry of Internal Affairs and Communications

Net Migration

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 Office

Status of Investment into Residencesby Listed J-REITs(number of buildings)

Source: Prepared by Samty Asset Management based on ARES J-REIT Property Database
Source: Prepared by Sumitomo Mitsui Trust Research Institute based on “Basic
Resident Registers,” Ministry of Internal Affairs and Communications(Note）Total of each listed J-REITʼs owned residences (1,576 buildings)
at end of the most recent fiscal period as of August 24, 2016.

33

Overview of the Samty Group
Property Leasing

History and Operating Results
History

Dec.
1982

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 andconducted real estate securitizationthat was the first such operation
approved by the Kinki Local
Finance Bureau

Jun.
2012
Nov.
2012
May
2015

Mar.
2005

Launched the S-Residence seriesof rental condominiums for realestate 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

Established Fukuoka Branch Office The Samty Group owns condominiums, office buildings, retail properties, hotels and parking lots either
for the entire buildings or in sectional ownership, and leases them to individuals and corporate tenants.
 The Group continuously acquires income-generating real estate properties in major regional cities
throughout Japan, centering on the Kansai area where the Groupʼs headquarters exist.
 The in-house design and leasing divisions have qualified architects of the first class, who study andimplement lease-up plans and measures to enhance asset value. The Group also conducts subleasing
and consigned operations of building management, etc. As such, the group has accumulated a wide
range of know-how and experiences.

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

Net sales : Other Businesses (left axis)
Net salse : Real Estate Business (left axis)

Tohoku4,017㎡
1%

Kanto
32,189㎡
8%
Chubu
17,938㎡
5%

7,500
6,000

25,0004,500

20,00015,0003,000

10,000
1,500

5,000
0

0
Nov.

Nov.

Nov.

Nov.

2008
2009
2010
2011
2012
2013
2014
2015
Source: Securities Reports (from the fiscal year ended November 2008 to the fiscal year ended November 2015)
of Samty Co., Ltd.
(Note) The Net sales figure as of November 2008 shows the total of all the sales due to the change insegmentation method.

Solution Business

Kinki
271,305㎡
69%

The Samty Group sells real estate properties it develops on its own and existing income-generating realestate properties, etc. that it acquires from third parties to external investors and other buyers. A
representative product of the real estate properties it develops is the S-RESIDENCE series rental
condominiums, prefixed with its own brand, for which the Group operates consistently from acquiring land
for the project to planning and developing the product and constructing it. For the income-generating realestate properties it has developed or acquired, the Samty Group not only invites tenants but also works toenhance the grades of the properties through facility renovations by utilizing its know-how, in an endeavor
to secure earnings during the period it owns them and maximize their sale value. Since 2004, the Group has
sold 28 buildings (totaling 45.5 billion yen on a sale price basis), of which 6 buildings (totaling 13.8 billion
yen on a sale price basis) are owned by listed J-REITs as of the date of this document.

(million yen)

30,000Nov.

Hokkaido
12,156㎡
3%

Shikoku
699㎡
0.7%

9,000

Nov.

Kyusyu52,780㎡
14%Real Estate Business

35,000Nov.

Condominiums
33,57846%

Hotels / Others
etc.
28,89739%

40,000Nov.

(Leased area : as of November 30, 2015)

Office Buildings
10,653
15%

Change in the Operating Results of the Samty Group (Consolidated Basis)45,000(Book value : as of November 30, 2015)

Established Nagoya Branch Office

Established Samty Kanri Co., Ltd.
that is engaged in property
management businessNet sales : Total (left axis)
Net sales : Property Leasing (left axis)
Operating income (right axis)

Distribution of Lease Assetsof the Samty Group(million yen)

Moved up to the First Section of
the Tokyo Stock Exchange.

Established Tokyo Branch Office(million yen)

Composition ratio of Lease Assets of
the Samty Group（million yen）

Development Results and Development Plan of the S-RESIDENCE Series

14,00012,00010,000
8,000
6,000
4,000
2,000
0

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

(results) (results) (results) (results) (results) (results) (results) (results) (results) (results) (results) (planned) (planned) (planned)
Source: Presentation on Operating Results for Fiscal Year Ending November 2015 by Samty Co., Ltd.
(Note 1) Development results represent a compilation of the sale amounts of rental condominiums developed for listed J-REITs and investment funds.
(Note 2) Development plans represent a compilation of the assumed sale amounts of properties for which the Samty Group has concluded agreements
regarding acquisition of the land for the projects. The figures are as of the end of November 2015, and may be changed in accordance with an increaseor a decrease in the number of future agreements on acquiring land and changes in the assumed sale amounts.

34

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 35

Portfolio List (1) Major Regional Cities
List of acquired properties(Number of acquired properties as of the date of this document ）Appraisal Value
Property

Property nameNo.

Location

type

Acquisition Priceat End of Period(millions of yen)(millions of yen)(note)

appraisal Number of
NOI yield

rentable

(%)

units

Major regional cities
A-01

S-FORT Shin Osaka ravir

Yodogawa-ku, Osaka

Single / Compact

635

660

5.5

49

A-02

S-FORT Sanno

Nakagawa-ku, Nagoya

Single / Compact

2,890

3,100

6.1

230

A-03

S-FORT Fujigaoka

Meitou-ku, Nagoya

Single

750

797

6.0

80

A-04

S-FORT Chikushi Dori

Hakata-ku, Fukuoka

Compact

1,170

1,190

5.7

90
104

A-05

S-FORT Fukuoka Kencho Mae

Hakata-ku, Fukuoka

Single

979

1,070

5.8

A-06

S-FORT Takamiya

Minami-ku, Fukuoka

Single / Commercial

794

826

5.6

82

A-07

S-FORT Tsutsujigaoka Koen

Miyagino-ku, Sendai

Single / Compact / Family

1,340

1,390

5.7

94

A-08

S-RESIDENCE Namba Briller

Naniwa-ku, Osaka

Single

2,020

2,220

5.4

154

A-09

S-FORT Tsurumai marks

Naka-ku, Nagoya

Family

1,020

1,150

5.7

42

A-10

S-FORT Rokuban-cho

Atsuta-ku, Nagoya

Single / Commercial

722

753

5.4

56

A-11

S-FORT Nakajima Koen

Chuo-ku, Sapporo

Compact / Family

1,590

1,630

5.7

75

A-12

S-FORT Hokudai Mae

Kita-ku, Sapporo

Compact / Commercial

A-13

S-RESIDENCE Kobe Isogamidori

Chuo-ku, Kobe

Single / Compact

A-14

S-FORT Kyoto Nishioji

Shimogyo-ku, Kyoto

Single / Commercial

A-15

S-FORT Katahira

Aoba-ku, Sendai

Single / Compact

A-16

S-FORT Gakuenmae

Toyohira-ku, Sapporo

Single / Compact

A-17

S-RESIDENCE Shin Osaka Ekimae

Higashi Yodogawa-ku, Osaka

Single / Compact

690

730

5.8

59

2,470

2,680

5.4

166

745

797

6.0

71

2,330

2,530

5.9

191

462

479

6.0

48

2,489

2,650

5.3

167

A-18

S-FORT Aoi 1-Chome

Higashi-ku, Nagoya

Compact

1,080

1,120

5.3

54

A-19

S-FORT Aoi

Higashi-ku, Nagoya

Family

870

973

5.7

28

A-20

S-FORT Kurumamichi

Higashi-ku, Nagoya

Family

400

423

5.8

19

A-21

S-FORT Kamiotai

Nishi-ku, Nagoya

Family

720

735

5.6

40

A-22

S-FORT Tsurumai arts

Naka-ku, Nagoya

Family

680

753

5.6

28

A-23

S-FORT Tsurumai cubeNaka-ku, Nagoya

Compact / Family

570

631

5.6

32

A-24

S-FORT Fukuoka Higashi

Hakata-ku, Fukuoka

Compact

1,900

2,010

5.4

135

A-25

S-RESIDENCE Kobe Motomachi

Chuo-ku, Kobe

Single / Compact

1,200

1,320

5.6

81

A-26

S-FORT Kobe Kaguracho

Nagata-ku, Kobe

Single

1,858

2,090

6.2

168

A-27

S-FORT Nijo-jo mae

Nakagyo-ku, Kyoto

Single / Compact / Family

812

842

5.1

47

A-28

S-FORT Chion-in mae

Higashiyamaku, Kyoto

Compact / Family / Commercial

500

515

5.0

18

A-29

S-FORT Miyamachi

Aoba-ku, Sendai

Single / Compact

1,085

1,110

5.5

91

(Note) Appraisal values are indicated for properties acquired in August 2016, and appraisal values at end of period(end of fiscal period ending July 2016) are indicated for other properties.

36

Portfolio List (2) Other Regional Cities / Greater Tokyo Area
List of acquired properties(Number of acquired properties as of the date of this document ）Other regional cities
B-01

S-FORT Shizuoka HondoriAoi-ku, Shizuoka

Compact

B-02

S-FORT Suminodo

Daitou-shi, Osaka

Single / Compact

297

300

6.0

28

1,420

1,530

6.0

126

B-03

S-FORT Yokkaichi motomachi

Yokkaichi-shi, Mie

Compact

480

513

6.7

54

B-04

S-FORT Suzuka

Suzuka-shi, Mie

Compact

580

608

6.9

69

B-05

S-RESIDENCE Esaka

Suita-shi, Osaka

Single / Compact

2,323

2,490

5.4

138

B-06

S-FORT Utsunomiya

Utsunomiya-shi, Tochigi

Compact

612

640

6.1

52

B-07

S-FORT Yokkaichi Nishishinchi

Yokkaichi-shi, Mie

Compact / Family

630

701

6.6

60

B-08

S-FORT Saga Honjo

Saga-shi, Saga

Compact / Office

1,050

1,070

6.2

127

B-09

S-FORT Saga Idaimae

Saga-shi, Saga

Compact

375

394

6.5

46

Greater Tokyo area
C-01

S-FORT Maita Koen

Minami-ku, Yokohama

Single / Compact

987

1,020

5.3

70

C-02

S-FORT Nihombashi Hakozaki

Chuo-ku, Tokyo

Single / Compact

925

992

4.7

36

C-03

S-FORT Itabashi Shimura

Itabashi-ku, Tokyo

Compact

645

670

4.7

32

C-04

S-FORT Shiomi

Koto-ku, Tokyo

Single

866

977

5.1

52

C-05

S-FORT Noborito

Tama-ku, Kawasaki

Single

666

694

4.8

40

C-06

S-FORT Shonan Hiratsuka

Hiratsuka-shi, Kanagawa

Single

818

889

5.5

66

C-07

S-FORT Nishifunabashi

Funabashi-shi, Chiba

Single / Compact

C-08

S-FORT Maihama

Urayasu-shi, Chiba

Single

C-09

S-FORT Ichikawa

Ichikawa-shi, Chiba

C-10

S-RESIDENCE Yokosuka Chuo

Yokosuka-shi, Kanagawa

C-11

S-FORT Sagamihara

Sagamihara-shi, Kanagawa

Single

Total

732

754

5.3

47

1,130

1,170

5.4

83

Single / Commercial

809

856

5.2

51

Single / Nursery

850

910

6.1

25

585

604

5.4

53

51,551

54,956

5.6

3,754

49 properties(Note) Appraisal values are indicated for properties acquired in August 2016, and appraisal values at end of period(end of fiscal period ending July 2016) are indicated for other properties.

37

Income and Expenditure by Property (1)Fiscal Period Ending July 2016 (As of July 31, 2016)(1) Area category

Major regional cities(2) Property No.

A-01(3) Property name(4) Acquisition date(5) Price
information(6) Leasing
information

A-05

A-06

A-07

A-08

S-FORT

S-FORT Shin

S-FORT

S-FORT

S-FORT

S-FORT Fukuoka

S-FORT

Osaka ravir

Sanno

Fujigaoka

Chikushi DoriKencho Mae

Takamiya

Apr. 15, 2015

Apr. 15, 2015

Apr. 15, 2015

May 1, 2015

Apr. 15, 2015

May 1, 2015

Tsutsujigaoka
Koen
Apr. 15, 2015

S-RESIDENCE
Namba Briller
Jul. 1, 2015

635

2,890

750

1,170

979

794

1,340

2,020

2.1

9.3

2.4

3.8

3.2

2.6

4.3

6.5

Balance sheet amount (million yen)

656

3,010

777

1,212

1,023

825

1,407

2,108

Total rentable area (㎡)1,290.84

8,138.40

1,960.00

3,706.56

2,566.72

2,105.13

3,609.49

3,631.60

Leased area (㎡)1,238.56

7,746.37

1,788.50

3,499.14

2,319.92

2,030.61

3,380.02

3,631.60

Occupancy rate (%)

95.9

95.2

91.3

94.4

90.4

96.5

93.6

100.0

(1) Number of operating days

182

182

182

182

182

182

182

182

21,270110,643

28,512

43,205

34,15928,54751,79069,668

Real estate rental revenues

19,536

101,856

26,13639,75432,52427,25644,76364,447

Other lease business revenues

1,733

8,786

2,376

3,450

1,634

1,291

7,027

5,220

6,212

25,273

7,896

10,204

8,694

7,186

12,933

13,349Management service fee

1,190

5,616

1,483

1,668

1,612

1,403

2,047

2,581

Taxes and dues

1,309

8,175

1,987

2,981

2,430

2,011

2,863

5,018

Utilities expenses

304

949

418

512

402

462

1,659

830

Repair Cost

946

5,762

2,238

2,827

2,847

2,022

2,823

1,215

Insurance expenses

33

177

46

93

62

60

82

103

(3) Real estate rental expenses(thousand yen)

information

A-04

Composition ratio (%)(thousand yen)expenses

A-03

Acquisition price (million yen)

(2) Total real estate rental income(7) Income andA-02

Trust fees

297

297

297

297

297

297

297

396

2,130

4,295

1,426

1,825

1,041

927

3,160

3,204

(4) NOI(＝(2)-(3)) (thousand yen)

15,05785,36920,61533,00025,46521,36038,85656,318(5) Depreciation (thousand yen)

5,751

26,68010,163

10,723

9,130

8,731

12,29113,803

9,305

58,68810,452

22,277

16,334

12,62926,56542,514

968

950

-

-

-

-

264

-

14,08984,41920,61533,00025,46521,36038,59256,318Other(6) Real estate rental income(＝(4)-(5))（thousand yen）
(7) Capital Expenditures(thousand yen)(8) NCF(＝(4)-(6))（thousand yen）

38

Income and Expenditure by Property (2)Fiscal Period Ending July 2016 (As of July 31, 2016)
Major regional cities(1) Area category
A-09(2) Property No.
(3) Property name(4) Acquisition date(5) Price
information(6) Leasing
information

Acquisition price (million yen)
Composition ratio (%)

A-13

A-14

A-15

A-16

S-FORT

S-FORT

S-FORT

S-FORTS-RESIDENCE

S-FORT

S-FORT

S-FORT

Tsurumai marks

Rokuban-cho

Nakajima Koen

Hokudai Mae

Kobe Isogamidori

Kyoto Nishioji

Katahira

Gakuenmae

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

Oct. 1, 2015

1,020

722

1,590

690

2,470

745

2,330

462

2.3

5.1

2.2

8.0

2.4

7.5

1.5

749

1,665

732

2,580

785

2,416

492

Total rentable area (㎡)2,772.00

1,833.29

5,292.65

2,287.22

4,372.45

1,657.31

5,483.22

1,757.28

Leased area (㎡)2,640.00

1,706.84

4,988.67

2,249.88

4,348.20

1,590.40

5,280.55

1,536.31

Occupancy rate (%)

95.2

93.1

94.3

98.4

99.4

96.0

96.3

87.4

(1) Number of operating days

182

182

182

182

182

182

182

182

35,912

22,30857,52225,19088,05525,854

86,416

16,560Real estate rental revenues

33,50820,84053,13924,26379,18823,716

79,78014,992Other lease business revenues

2,404

1,467

4,383

927

8,867

2,137

6,635

1,567

4,959

6,519

17,005

4,679

13,271

8,362

20,9505,731Management service fee

1,643

1,223

2,649

1,021

2,715

1,727

3,999

739

Taxes and dues

1,679

1,676

4,793

1,619

5,424

1,452

6,298

1,277

Utilities expenses

275

240

1,678

498

486

1,098

843

376

Repair Cost

573

1,914

3,718

451

1,476

2,064

5,584

1,760

Insurance expenses

55

38

120

53

116

45

145

31

Trust fees

297

297

396

297

396

297

297

277

Other

434

1,129

3,649

739

2,655

1,678

3,781

1,267

(4) NOI(＝(2)-(3)) (thousand yen)

30,953

15,78940,516

20,51074,783

17,491

65,466

10,828(5) Depreciation (thousand yen)

9,690

7,431

13,226

5,291

18,371

8,071

27,944

4,622

21,263

8,357

27,29015,21956,411

9,419

37,521

6,206

101

100

825

-

-

1,600

2,631

271

30,852

15,68939,691

20,51074,783

15,891

62,834

10,557(3) Real estate rental expenses(thousand yen)

information

A-12

3.3

(thousand yen)expenses

A-11

1,099

Balance sheet amount (million yen)

(2) Total real estate rental income(7) Income and

A-10(6) Real estate rental income(＝(4)-(5))（thousand yen）
(7) Capital Expenditures(thousand yen)(8) NCF(＝(4)-(6))（thousand yen）

39

Income and Expenditure by Property (3)Fiscal Period Ending July 2016 (As of July 31, 2016)
Other regional cities(1) Area category
B-01(2) Property No.
(3) Property name(4) Acquisition date(5) Price
information(6) Leasing
information

C-01

C-02
S-FORT

S-FORT

S-FORT

S-FORT Yokkaichi

S-FORT

S-FORT

Shizuoka Hondori

Suminodo

Motomachi

SuzukaMaita Koen

Apr. 15, 2015

Apr. 15, 2015

Jul. 1, 2015

Jul. 1, 2015

Apr. 15, 2015

Nihombashi
HakozakiJul. 1, 2015

C-03

C-04

S-FORT Itabashi

S-FORT

ShimuraShiomiJul. 1, 2015

Jul. 1, 2015

297

1,420

480

580

987

925

645

866

1.0

4.6

1.6

1.9

3.2

3.0

2.1

2.8

Balance sheet amount (million yen)

310

1,471

521

626

1,016

959

667

901

Total rentable area (㎡)911.403,332.16

1,691.28

2,286.69

1,609.80

1,114.38

1,119.54

1,042.48

Leased area (㎡)716.103,254.13

1,599.93

2,256.24

1,471.70

1,038.56

1,046.49

1,022.47

Occupancy rate (%)

78.6

97.7

94.6

98.7

91.4

93.2

93.5

98.1

(1) Number of operating days

182

182

182

182

182

182

182

182

11,23054,297

21,391

26,19331,47527,56019,95329,059Real estate rental revenues

9,246

46,844

18,74622,19528,576

24,411

18,671

26,398Other lease business revenues

1,983

7,453

2,645

3,998

2,898

3,149

1,282

2,660

5,004

12,674

5,117

7,124

10,236

4,788

5,391

6,727

1,071

1,833

1,402

1,670

2,421

1,639

1,339

1,948

Taxes and dues

852

2,897

1,118

1,672

1,883

1,289

1,296

1,324

Utilities expenses

143

1,983

738

1,131

510

479

294

537

(3) Real estate rental expenses(thousand yen)Management service fee

information

B-04

Composition ratio (%)(thousand yen)expenses

Greater Tokyo area

B-03

Acquisition price (million yen)

(2) Total real estate rental income(7) Income and

B-02

Repair Cost

1,672

2,871

897

1,008

3,127

311

868

1,329

Insurance expenses

24

87

37

53

53

36

32

39

Trust fees

297

297

297

297

297

396

396

396

Other

942

2,703

624

1,290

1,943

635

1,162

1,151

(4) NOI(＝(2)-(3)) (thousand yen)

6,225

41,623

16,27419,06921,23822,771

14,562

22,331(5) Depreciation (thousand yen)

3,126

14,873

6,206

7,284

10,339

4,967

4,109

6,048

3,098

26,74910,068

11,784

10,89917,804

10,452

16,283

687

-

-

130

-

508

400

-

5,538

41,623

16,274

18,93921,23822,263

14,162

22,331(6) Real estate rental income(＝(4)-(5))（thousand yen）
(7) Capital Expenditures(thousand yen)(8) NCF(＝(4)-(6))（thousand yen）

40

Income and Expenditure by Property (4)Fiscal Period Ending July 2016 (As of July 31, 2016)
Greater Tokyo area

(1) Area category
C-05(2) Property No.

S-FORT(3) Property nameinformation(6) Leasing
information

Jul. 1, 2015

S-FORT

S-FORT

S-FORT

Nishifunabashi

MaihamaIchikawa

Jul. 1, 2015

Jul. 1, 2015

Jul. 1, 2015

818

732

1,130

809

Composition ratio (%)

2.2

2.6

2.4

3.6

2.6

Balance sheet amount (million yen)

688

877

757

1,165

832

Total rentable area (㎡)1,022.10

1,717.46

1,397.64

1,726.56

1,255.90

Leased area (㎡)1,022.10

1,717.46

1,329.14

1,664.08

1,234.08

100.0

100.0

95.1

96.4

98.3

182

182

182

182

182

21,25631,091

24,00838,746

27,768

Real estate rental revenues

20,251

28,871

22,62034,10325,624

Other lease business revenues

1,005

2,219

1,387

4,642

2,143

5,032

7,535

5,430

6,960

6,582

Management service fee

1,327

1,541

1,311

1,802

2,337

Taxes and dues

1,085

1,907

1,356

1,370

1,506

Utilities expenses

211

222

350

721

831

Repair Cost

915

433

1,144

1,713

657

Occupancy rate (%)(thousand yen)

(3) Real estate rental expenses(thousand yen)

information

Jul. 1, 2015

C-09

666

(2) Total real estate rental income

expensesHiratsuka

C-08

Acquisition price (million yen)

(1) Number of operating days(7) Income andC-07

ShonanNoborito(4) Acquisition date(5) Price

C-06
S-FORT

Insurance expenses

31

42

34

44

39

Trust fees

396

396

396

396

396

1,065

2,990

836

911

814

(4) NOI(＝(2)-(3)) (thousand yen)

16,22323,556

18,577

31,785

21,186(5) Depreciation (thousand yen)

5,452

6,456

6,121

6,764

3,050

10,771

17,09912,45525,02018,135

-

-

110

400

105

16,22323,556

18,467

31,38521,080Other(6) Real estate rental income(＝(4)-(5))（thousand yen）
(7) Capital Expenditures(thousand yen)(8) NCF(＝(4)-(6))（thousand yen）

41

Financial Documents: Balance Sheet(Unit: thousand yen)

(Unit: thousand yen)Previous Fiscal Year

Current Fiscal Year

Previous Fiscal Year

Current Fiscal Year

(January 31, 2016)(July 31, 2016)(January 31, 2016)(July 31, 2016)

AssetsLiabilities

Current Assets

Current liabilities

Cash and deposits

276,619

348,514

Operating accounts payable

72,71458,959Cash and deposits in trust

705,877

736,636

Short-term loans payable

1,162,000

1,012,000

Operating accounts receivable

4,243

3,174

Accounts payable – other161,846

10,406

Prepaid expenses

42,931

45,113

Accrued expenses

1,166

1,022

Consumption tax receivable

144,140-

Accrued dividend

-

2,095

27

11

Accrued consumption taxes

-

4,555

deferred tax assets
Other
Total-current assets-

20,841

1,173,839

1,154,291

Non-current assets

Deposits received

Property, plant and equipment
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Machinery and equipment in trust

Total current liabilities
20,131,994

20,139,584-351,345-619,387

19,780,648

19,520,196

358,415

358,415

1,581

827

143,550

150,156

12,8702,146

1,555,730

1,242,170

16,000,000

16,000,000

Non-current liabilities
Long-term loans payable
Tenant leasehold and security deposits in trust
Total non-current liabilities

150,602

149,714

16,150,602

16,149,714

17,706,332

17,391,884

16,015,052

16,015,052

Accumulated depreciation-10,831-19,013

Total Liabilities

Machinery and equipment in trust, net

347,584

339,401

Net assets

Tools, furniture and fixtures in trust

2,894

5,355

Accumulated depreciation

-396

-899

Tools, furniture and fixtures in trust, net

2,498

4,456

Land in trust

12,477,166

12,477,166

Unitholdersʼ capital (Net amount)

Total property, plant and equipment

32,607,898

32,341,221

Surplus-20,966

Lease and guarantee deposits

10,284

10,284

16,184,016

16,219,237

Long-term prepaid expenses

98,32784,358

Total net assets

16,184,016

16,219,237

Total liabilities and net assets

33,890,349

33,611,122

Investments and other assets
Investment securities

Total investments and other assets
Total non-current assets
Total Assets

Income taxes payable
Advances received

108,611

115,60932,716,510

32,456,831

33,890,349

33,611,122

Unitholdersʼ equity
Unitholdersʼ capital
Amount deducted from Unitholders' capital--126,751

16,015,052

15,888,300

Unappropriated retained earnings

168,963

330,936

Total surplus

168,963

330,936

Total unitholdersʼ equity

42

Financial Documents：Statement of Income(Unit: thousand yen)Previous Fiscal Period

Current Fiscal Year

From: March 16, 2015

From: February 1, 2016

To:January 31, 2016)

To: July 31, 2016

Operating revenue
Rent revenue - real estate
Other lease business revenues
Dividents from anonymous partnership
Total operating revenue

1,299,936

1,012,267

158,639

97,383-966

1,458,576

1,110,617

Operating expenses
Expenses related to rent business

628,836

538,568

Asset management fee

91,851

76,044

Asset custody fee

5,015

3,233

Administrative service fees

28,454

23,128

Directorsʼ compensations

4,400

2,400

-

8,150

Remuneration for Accounting Auditors
Other operating expenses

101,288

41,768

Total operating expenses

859,846

693,294598,729

417,322

Operating income
Non-operating income
Interest income

71

77Interest on refund

-

305

71

382

Interest expenses

120,663

64,924

Borrowing related expenses

180,020

21,049Deferred organization expenses

70,000-Investment unit issuance costs

57,584-

Total non-operating expenses

428,268

85,973

Ordinary income

170,532

331,731

Net income before income taxes

170,532

331,731

Income taxes – current

1,596

849

Deferred Income taxes

-27

15

1,569

865

168,963

330,866

Total non-operating income
Non-operating expenses

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

70

168,963

330,93643

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

(Unit: thousand yen)Previous Fiscal Period

Current Fiscal Year

Previous Fiscal Period

Current Fiscal Year

From: March 16, 2015

From: February 1, 2016

From: March 16, 2015

From: February 1, 2016

To:January 31, 2016)

To: July 31, 2016

To:January 31, 2016)

To: July 31, 2016

Cash flows from operating activities

Cash flows from financing activities

Net income before income taxes

170,532

331,731

Proceeds from short-term loans payable

12,962,000

550,000

Depreciation

362,572

276,728

Repayments of short-term loans payable-11,800,000-700,000

Proceeds from long-term loans payable

16,000,000-

Proceeds from the issuance of investment units

15,957,467-

Interest income

-71

-77

Interest expenses

120,663

64,924

Investment unit issuance costs

57,584-

Decrease (increase) in operating accounts receivable-4,243

1,069

Decrease (increase) in consumption taxes receivable-144,140

144,140-

4,555-42,931-2,181

Cash and cash equivalents at the end of period

Decrease (increase) in consumption taxes payable
Decrease (increase) in prepaid expenses
Increase (decrease) in operating accounts payable

69,591-13,785

Increase (decrease) in accounts payable – other161,306-150,899

Increase (decrease) in advances received

143,550

6,606

Decrease (increase) in long-term prepaid expenses-98,327

13,968Other, net-32,926-32,532

Subtotal

763,160

644,247

Interest income received
Interest expenses paid
Income taxes – current
Cash flows from operating activities

71

77-119,496-65,068-14-1,603643,721577,652-32,966,807-10,561

Cash dividends paid-

-293,549

33,119,467-443,549

Net increase (decrease) in cash and cash equivalents

982,496

102,653

Cash and cash equivalents at the beginning of period-

982,496

982,496

1,085,150

Cash flows from financing activities

Cash flows from investing activities
Purchase of property, plant and equipment in trust
Payments for lease and guarantee deposits-10,284-

Repayments of tenant leasehold and security deposits in trust-19,086-22,076

Proceeds from tenant leasehold and security deposits in trust

215,486

21,188--20,000-32,780,692-31,449

Purchase of investment securities
Cash flows from investing activities

44Unitholder Information (1)Number of Units and Number of Unitholders by Unitholder Type
Number of units by unitholder typeEnd of 1st period

Financial Institutions

Overseas(January 31, 2016)

Other domestic(including financial dealers)

corporations

investors

163,340 units

55,285units

21,572units

3,204units

End of 2nd period

Financial Institutions(July 31, 2016)(including financial dealers)

corporations

investors

163,340 units

53,419units

19,699units

5,590units

40%

50%

0%

10%

20%

Individuals / Other
83,279units

Other domestic Overseas

30%

Individuals / Other
84,632units

60%

70%

80%

90%

100%

Unitholder Information
Number of units byunitholder type
Financial Institutions

As of January 31, 2016

As of July 31, 2016

Increase/decrease

Number of

Number of

Number of

units

Ratio

units

Ratio

units

unitholder type

Ratio

Financial Institutions

As of January 31, 2016
Number ofunitholders

Ratio

As of July 31, 2016
Number ofunitholders

Ratio

Increase/decrease
Number ofunitholders

Ratio

45 people

0.4%

51 people

0.5%

6 people

0.0%

Other domestic corporations

207 people

2.0%

186 people

1.6%-21 people

-0.3%

1.5%

Overseas investors

34 people

0.3%

46 people

0.4%

12 people

0.1%

1,353 units

0.8%

Individuals / Other

10,148 people

97.3%

10,999 people

97.5%

851 people

0.2%

0 units

0.0%

Total

10,434 people

100.0%

11,282 people

100.0%

848 people

0.0%

55,285 units

33.8%

53,419 units

32.7%-1,866 units-1.1%

Other domestic corporations

21,572 units

13.2%

19,699 units

12.1%-1,873 units-1.1%

Overseas investors

3,204 units

2.0%

5,590 units

3.4%

2,386 units

Individuals / Other

83,279 units

51.0%

84,632 units

51.8%

Total

163,340 units

100.0%

163,340 units

100.0%(including financial dealers)

Number of unitholders by(including financial dealers)45

Unitholder Information (2)Major Unitholders
Major Unitholders (top 10) as of July 31, 2016
Investment
Unitholder nameunits
(units)

Ratio(%)

Japan Trustee Services Bank, Ltd. (Trust Account)

15,0089.2

Samty Co., Ltd.

10,000

6.1

Kinki Sangyo Credit Union

7,588

4.6

5,679

3.5

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

5,343

3.3

Daido shinyoukumiai

3,500

2.1

Individual

3,321

2.0

2,893

1.8

Osaka co-sei Shinkin Bank

2,310

1.4

Japan Trustee Services Bank, Ltd. (Trust Account 9)

1,860

1.1

Total of major unitholders (top 10)

57,502

35.2

Total of units

163,340

100.0

Trust & Custody Services Bank, Ltd.
(Securities Investment Trust Account)

The Nomura Trust and Banking Co., Ltd.
(Trust Account)46

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.

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