February 14, 2020

CRE Logistics REIT, Inc.
Summary of Financial Results (Unaudited)
For the 7th Fiscal Period Ended December 31, 2019(For the Reporting Period from July 1, 2019 to December 31, 2019)(Translated from the Japanese original)
Corporate Information
Code: 3487 Listing: Tokyo Stock Exchange(URL: https://cre-reit.co.jp/en/)
Representative: Tsuyoshi Ito, Executive Director
Asset management company:
Representative:
Person of Contact:
Tel:

CRE REIT Advisers, Inc.
Tsuyoshi Ito, President
Hirohisa Toda, Head of Corporate Planning+81-3-5575-3600

Scheduled date to file securities report:
Scheduled date to commence payment of distributions:Preparation of supplementary material on financial results:
Financial report presentation meeting:March 24, 2020
March 19, 2020
Yes
Yes (for institutional investors and analysts)(Amounts truncated to the nearest million yen, except for the basic earnings per unit)
1. 7th Fiscal Period ended December 31, 2019 (July 1, 2019-December 31, 2019)(1) Operating results(Percentages represent changes from corresponding period of previous period)
Operating revenues
Operating income
Ordinary income
Net income
Fiscal period ended

December 31, 2019
June 30, 2019

Million yen%

Million yen%

Million yen%

Million yen

%

1,580
1,411

11.9
(0.1)

828
718

15.2
(11.4)

687
597

15.0
(13.3)

686
596

15.1
(13.4)

Return on
unitholders’ equity

Net income per unit

Ordinary income tototal assets

Ordinary income on
operating revenues

Fiscal period ended

Yen

%

%

%

December 31, 2019
June 30, 2019

2,670
2,580

2.6
2.4

1.3
1.2

43.5
42.3

(Note) The Investment Corporation issued 28,100 new investment units on July 16, 2019. Net income per unit for the fiscal period ended December
31,2019 is calculated by dividing net income by the weighted average number of investment units (256,959 units) based on the number of days
during the period.

(2) Distributions
Distributions
per unit(excluding
surplus
distributions)

Total
distributions(excluding
surplus
distributions)Fiscal period ended

Yen

Million yen

Yen

December 31, 2019
June 30, 2019

2,647
2,580

686
596

365
372

Surplus
distributions
per unit

Distributions
per unit(including
surplus
distributions)

Total
distributions(including
surplus
distributions)

Million yen

Yen

Million yen

%

%

94
85

3,012
2,952

780
682

100.0
100.0

2.5
2.4

Total surplus
distributions

Payout ratio

Distributions to
net assets ratio(Note 1) The entire amount of total surplus distributions is the return of contributions that falls under the distribution associated with the investment
decrease for tax purposes.
(Note 2) The percentage of decreased surplus as a result of surplus distributions (the return of contributions that falls under the distribution associatedwith the investment decrease for tax purposes) in the fiscal period ended June 30, 2019 and the fiscal period ended December 31, 2019 was
0.004, respectively. The calculation of the percentage of decreased surplus is based on Article 23, Paragraph 1, Item 4 of the Order for
Enforcement of the Corporation Tax Act.
(Note 3) The payout ratio in the fiscal period ended December 31, 2019 is calculated based on the following formula because the Investment Corporation
issued new investment units.
Payout ratio = Total amount of distributions (excluding surplus distributions) ÷ Net income × 100(3) Financial position
Total assets
As ofDecember 31, 2019
June 30, 2019

Net assets

Unitholders’ equity ratio

Net assets per unit

Million yen

Million yen%

Yen

55,96049,717

27,741
24,541

49.6
49.4

107,005
106,169－1－

(4) Cash flows
Cash flows fromoperating activities
Fiscal period ended

Cash flows frominvesting activities

Million yen

December 31, 2019
June 30, 2019

Cash flows fromfinancing activities

Cash and cash equivalents
at end of the fiscal period

Million yen

Million yen

Million yen(6,437)
(145)

5,396
(773)

1,358
1,645

753
937

2. Forecast for the 8th Fiscal Period ending June 2020 (January 1, 2020-June 30, 2020) and the 9th Fiscal Period ending December 2020
(July 1, 2020-December 31, 2020)(Percentages represent changes from corresponding period of previous period)
Operatingrevenues

OperatingincomeFiscal period ending

MillionyenJune 30, 2020
December 31, 2020

2,024 28.1
2,122
4.8

%

Millionyen

Ordinary
incomeDistributions
Distributions
per unit (including
per unit
surplus(excluding surplus
distributions)distributions)

Net income%

Millionyen%

1,133 36.8
1,194
5.4

947
1,021

37.9
7.8

Millionyen

Surplus
distributions
per unit

%

Yen

Yen

Yen

946 38.0
1,020
7.8

3,040
3,263

2,726
2,940

314
323

(Reference) Forecast net income per unit (Forecast net income/ Forecast number of investment units at the end of the fiscal period) for the 8th Fiscal
Period ending June 2020 is 2,726 yen and forecast net income per unit for the 9th Fiscal Period ending December 2020 is 2,939 yen.

* Other(1) Changes in accounting policies, changes in accounting estimates and retrospective restatements
1. Changes in accounting policies associated with revision of accounting standards, etc.: None
2. Changes in accounting policies associated with other than 1: None
3. Changes in accounting estimates: None
4. Restatements: None

(2) Total number of investment units issued and outstanding
1. Total number of investment units issued andAs of December 31,
outstanding at the end of the fiscal period
259,250 units
2019(including treasury investment units)

As of June 30, 2019

231,150 units

2. Total number of treasury investment units at As of December 31,
the end of the fiscal period
2019

As of June 30, 2019

0 units

0 units* Summary of financial results is not inside the scope of audit procedure by certified public accountants or audit corporations.
* Remarks on appropriate use of forecasts of performance and other special notes
Forward-looking statements presented in this financial results, including forecasts of performance, are based on information
currently available to the Investment Corporation and on certain assumptions the Investment Corporation deems to be reasonable.
As such, actual operating and other results may differ materially from these forecasts as a consequence of various factors. Moreover,the forecasts set forth herein should not be construed as a guarantee of distribution amounts.
Refer to the section on “Assumptions for Operating Forecasts for the 8th Fiscal Period ending June 2020 (January 1, 2020-June 30,2020) and the 9th Fiscal Period ending December 2020 (July 1, 2020-December 31, 2020)” for details on the underlying
assumptions for the forecasts above.

－

2

－

Assumptions for Operating Forecasts for the 8th Fiscal Period ending June 2020 (January 1, 2020-June 30, 2020) and 9th Fiscal Period
ending December 2020 (July 1, 2020-December 31, 2020)
Item
Calculation period

Assumptions- 8th Fiscal Period (Ending June 30, 2020): January 1, 2020-June 30, 2020 (182 days)- 9th Fiscal Period (Ending December 31, 2020): July 1, 2020-December 31, 2020 (184 days)

Assets undermanagement- The investment corporation possesses the trust beneficial interests in real estate in a total of nine properties(hereinafter referred to as “assets currently held”)—nine properties held as of December 31,2019 (hereinafterreferred to as “acquired assets before the fiscal period ended December 31, 2019”) and four properties
acquired on February 3, 2020 (hereinafter referred to as “acquired assets for the fiscal period ending June 30,
2020”).The operating forecasts herein are based on the assumption that the investment corporation willcontinue to possess these properties until December 31, 2020, as well as the assumption that there will be nofluctuations in the trust beneficial interests in real estate (including newly acquired properties and the disposalof currently-held assets).
- However, there is a possibility that fluctuations in the portfolio will occur due to factors including the newacquisition of properties or the disposal of assets currently held.

Operating revenues- Real estate lease business revenues are calculated based on leasing contracts that are effective as of the dateof submission of this financial results and actual performance in the past.
- The forecasts assume there are no delinquencies or default on rental payments by tenants.

Operating expenses- Expenses other than depreciation that fall under the category of real estate leasing expenses, which is theinvestment corporation’s main operating expenses, are actual expenses incurred on acquired assets before thefiscal period ended December 31, 2019. Regarding those acquired assets for the fiscal period ending June 30,
2020, expenses were forecast reflecting variables, including forecast costs (including taxes and public dues,
property management fees, fire insurance expenses, repair expenses) based on information obtained from theprevious owner, or the beneficiary who previously held the trust beneficiary interests.
- Property tax and city planning tax, etc. for acquired assets before the fiscal period ended December 31, 2019are expected to total 164 million yen per period.
- In addition, when real estate is purchased, property tax and city planning tax, etc. are calculated and divided
up on a pro-rated basis for calendar year with the current beneficiary of trust interests. The investment
corporation incorporates this amount into the acquisition cost of the property. In light of this, property tax
and city planning tax, etc. on the acquired assets for the fiscal period ending June 30, 2020 are not posted in
the 8th Fiscal Period and 9th Fiscal Period, but will be posted as property tax and city planning tax, etc. in
the 10th Fiscal Periods. In the event that the property tax and city planning tax, etc. on acquired assets for the
fiscal period ending June 30, 2020 were posted as expense, the amount is estimated at 48 million yen for eachsix-month period starting from the 10th Fiscal Period. Note that the total amount of property tax and city
planning tax, etc. to be incorporated into the acquisition cost for the acquired assets for the fiscal period
ending June 30, 2020 is estimated at 89 million yen.
- Depreciation is based on the straight-line method. Depreciation is forecast to be 364 million yen in the fiscal
period ending June 30, 2020 and 374 million yen in the fiscal period ending December 31, 2020.
- Property management fees are expected to be 98 million yen in the fiscal period ending June 30, 2020 and
103 million yen in the fiscal period ending December 31, 2020.

Non-operating
expenses- Non-operating expenses for the 8th Fiscal Period are expected to total 185 million yen. Of this, it is estimatedthat 152 million yen is for interest expenses and other financial related costs, 10 million yen is for costs
related to offerings new investment units, 6 million yen is for depreciation of founding costs, and 11 million
yen is for depreciation of investment unit issuance costs.
- Non-operating expenses for the 9th Fiscal Period are expected to total 172 million yen. Of this, it is estimatedthat 154 million yen is for interest expenses and other financial related expenses, 6 million yen is fordepreciation of founding costs, and 11 million yen is for depreciation of investment unit issuance costs.

Interest-bearing debt

- The total interest-bearing debt at the end of each fiscal period is as follows: 35,719 million yen as of June 30,
2020, and 35,219 million yen as of December 31, 2020.
- It is assumed that the investment corporation refinance 3,400 million yen(long-term borrowings of 3,200
million yen and short-term borrowings of 200 million yen) to repay 3,700 million yen which mature on July
31, 2020 in the fiscal period ending December 31, 2020.In addition, in the fiscal period ending December 31,
2020, the investment corporation expects to prepay 200 million yen which will be newly borrowed on July
31, 2020 as stated above by using some of its funds on hand as a source.
- The LTV is expected to be around 46.0% as of June 30, 2020, and about 45.6% as of December 31, 2020.
The following equation was used to calculate LTV. The figure is rounded to the second decimal point.
LTV = Interest-bearing debt / Total Assets x 100

Investment units- The assumptions for these forecasts are based on a total number of investment units issued of 347,250, as ofthe submission of these financial results. The forecasts do not factor in any assumption of a change in thenumber of investment units through December 31, 2020 due to factors such as the issuance of new investment
units.
- The distributions per unit (excluding surplus distributions) and the surplus distributions per unit are calculated
based on a total number of investment units issued of 347,250 for the fiscal period ending June 30, 2020 andthe fiscal period ending December 31, 2020.

－

3

－

Distributions per unit
(excluding surplus
distributions)- The distributions per unit (excluding surplus distributions) is calculated based on the assumption that
distributions are carried out in accordance with the policies for monetary distributions set forth in theregulations of the investment corporation.
- There is a possibility that the amount of the distributions per unit (excluding surplus distributions) couldchange owing to various factors, including changes in rental income, or unexpected maintenance work due
to a change in assets under management or a change in tenants.

Distributions per unitof surplus profit- The surplus distributions per unit is calculated in accordance with the policy stipulated in the operationalguidelines—the regulations of the investment corporation and the internal regulations of the asset
management company. The payout plan for total surplus distributions for the fiscal period ending June 30 ,2020 is 109 million yen and the fiscal period ending December 31, 2020 is 112 million yen, respectively,
with an amount equivalent to 30% of depreciation as a benchmark.
- These assumptions do not include any specific possibility of a substantial deterioration in the economic
climate, real estate market or the financial condition of the investment corporation.
- The policy of the investment corporation is to implement the distribution of surplus profit semiannually inprinciple. The amount of the surplus distribution should be equivalent to 30% of total depreciation.
- Moreover, in the event that the distributions per unit is expected to temporarily fall below a certain level due
to dilution in the value of the investment unit or a considerable financial burden owing to the procurement of
capital through the issuance of new investment units or other factors, the investment corporation may
continue to distribute surplus profit plus a one-off distribution that exceeds the profit level in the period forthe purpose of maintaining the ordinary level of the distributions per unit. However, this amount, which
includes the ongoing surplus distribution, shall not exceed the equivalent to 60% of total depreciation for the
relevant business period.
- In actuality, the amount of distributions exceeding profit (return of contributions) is likely to fluctuate due tochanges in the economic climate, real estate market trends, asset portfolio, and financial position, and there
is a possibility the investment corporation will not implement distributions (return of contributions) in surplus
distributions for the period.

Other- The forecasts were built based on the assumption that there will be no revisions to laws and ordinances, thetax system, accounting standards, listing regulations set forth by the Tokyo Stock Exchange, Inc., and theregulations stipulated by the Investment Trusts Association, Japan, that would have an impact on the forecasts
stated above.
- The forecasts are also based on the assumption that there will be no unexpected major changes to general
economic trends and the real estate market.

－

4

－

3. Financial Statements(1) Balance Sheet(Thousands of yen)
As of June 30, 2019

As of December 31, 2019

AssetsCurrent assets
Cash and deposits

1,124,800

776,182

Cash and deposits in trust

1,158,278

1,319,249

Operating accounts receivable

109,727

101,808

Prepaid expenses

81,57494,550Consumption taxes receivable－239,756

2,474,381

2,531,547

28,873,918

32,027,216

Accumulated depreciation(1,125,429)(1,429,813)

Buildings in trust, net

27,748,488

30,597,402

Total current assets
Non-current assets
Property, plant and equipment
Buildings in trust

Structures in trust

1,341,493

1,568,757

Accumulated depreciation(40,332)(51,995)

Structures in trust, net

1,301,160

1,516,762

Tools, furniture and fixtures in trust

682

682

Accumulated depreciation

(122)

(183)

Tools, furniture and fixtures in trust, net

560

499

Land in trust

17,969,495

21,042,131

Total property, plant and equipment

47,019,704

53,156,796

Other

2,866

2,466

Total intangible assets

2,866

2,466

Investment securities

10,50010,500Long-term prepaid expenses

157,524

205,913

Intangible assets

Investments and other assets

Deferred tax assets

14

13

Leasehold and guarantee deposits

10,00010,000Total investments and other assets

178,039

226,426

47,200,611

53,385,689

Organization expenses

23,21817,161

Investment unit issuance expenses

18,872

26,147

Total non-current assets
Deferred assets

Total deferred assets
Total assets

－

5

－

42,09043,30849,717,083

55,960,545

(Thousands of yen)
As of June 30, 2019

As of December 31, 2019

Liabilities
Current liabilities
Operating accounts payable

89,147

98,6306,680,000

3,700,000

106,480

121,951910

872

Accrued consumption taxes

31,901－

Advances received

252,086

285,146

2,113

4,600

7,162,640

4,211,201

17,140,000

23,019,000

873,269

989,21018,013,269

24,008,210

25,175,909

28,219,412

24,106,072

27,302,166

Current portion of long-term borrowings
Accrued expenses
Income taxes payable

Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Leasehold and guarantee deposits received intrust
Total non-current liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
Deduction from unitholders' capital(161,342)(247,330)

Unitholders' capital, net

23,944,729

27,054,836

596,444686,297

596,444686,297

24,541,173

27,741,133

24,541,173

27,741,133

49,717,083

55,960,545

Surplus
Unappropriated retained earnings(undisposed loss)
Total surplus
Total unitholders' equity
Total net assets
Total liabilities and net assets

－

6

－

(2) Statements of Income(Thousands of yen)
Fiscal period ended
June 30, 2019

Fiscal period ended
December 31, 2019

Operating revenue
Leasing business revenue

1,384,615

1,553,660

27,232

26,712

1,411,847

1,580,373

Expenses related to leasing business

532,472

570,836

Asset management fee

123,971

140,715

Other leasing business revenue
Total operating revenue
Operating expenses

Asset custody fee

1,618

1,611

Administrative service fees

11,338

12,204

Remuneration for directors (and other officers)

4,500

4,500

Other operating expenses

19,11022,272

Total operating expenses

693,011752,140

718,836828,233

Interest income

1010

Total non-operating income

1010Interest expenses

62,86568,442

Borrowing related expenses

40,56350,382

Amortization of organization expenses

6,056

6,056

Amortization of investment unit issuance expenses

12,030

9,483

－

6,782

121,517

141,147

Ordinary profit

597,329

687,096

Profit before income taxes

597,329

687,096

Income taxes - current

912

873

Income taxes - deferred(4)

1

Total income taxes

907

875

596,421686,220

Operating profit
Non-operating income

Non-operating expenses

Other
Total non-operating expenses

ProfitRetained earnings brought forward
Unappropriated retained earnings (undisposed loss)

－

7

－

22

77

596,444686,297

(3) Statements of Changes in Net Assets
Fiscal period ended June 30, 2019
(Thousands of yen)
Unitholders' equity
Unitholders' capital
Deduction
fromunitholders'
capitalUnitholders'
capitalBalance at
beginning of
periodChanges in items
during period
Distributions inexcess ofretainedearnings
Dividends ofsurplus24,106,072

Surplus
Unappropriatedretainedearnings(undisposed
loss)

Unitholders'
capital(75,354)

24,030,717(85,987)(85,987)

688,618

688,618

Total net
assets

24,719,335

24,719,335(85,987)(85,987)(688,595)(688,595)(688,595)(688,595)

596,421596,421596,421596,421

ProfitTotal changes in
items during
periodBalance at end of
periodTotalunitholders'
Total surplus
equity-(85,987)(85,987)(92,174)(92,174)(178,161)(178,161)

24,106,072(161,342)

23,944,729

596,444596,444

24,541,173

24,541,173

Fiscal period ended December 31, 2019
(Thousands of yen)
Unitholders' equity
Unitholders' capital
Unitholders'
capitalBalance at
beginning of
periodChanges in items
during period
Issuance of
new investment
units
Distributions inexcess ofretainedearnings
Dividends ofsurplus24,106,072

Deduction
fromunitholders'
capital(161,342)

3,196,094(85,987)

Surplus
Unitholders'
capitalUnappropriatedretainedearnings(undisposed
loss)

23,944,729

596,444596,444

Total net
assets24,541,173

24,541,173

3,196,094

3,196,094

3,196,094(85,987)(85,987)(85,987)

ProfitTotal changes in
items during
periodBalance at end of
periodTotalunitholders'equityTotal surplus(596,367)(596,367)(596,367)(596,367)

686,220686,220686,220686,220

3,196,094(85,987)

3,110,106

89,85389,853

3,199,959

3,199,959

27,302,166(247,330)

27,054,836

686,297686,297

27,741,133

27,741,133

－

8

－

(4) Statements of Cash Flows(Thousands of yen)
Fiscal period ended
June 30, 2019

Fiscal period ended
December 31, 2019

Cash flows from operating activities
Profit before income taxes

597,329

687,096

Depreciation

287,497

316,507

Amortization of deferred organization expenses

6,056

6,056

Amortization of investment unit issuance expenses

12,0309,483

Interest income

(10)

(10)

Interest expenses

62,86568,442

9,015

7,919

－

(239,756)

703(12,975)

Increase (decrease) in operating accounts payable

50,457

9,483

Increase (decrease) in accrued expenses(6,381)

13,102

Increase (decrease) in accrued consumption taxes

Decrease (increase) in operating accounts
receivable
Decrease (increase) in consumption taxes refund
receivable
Decrease (increase) in prepaid expenses(56,820)(31,901)

Increase (decrease) in advances received(158)

33,059Decrease (increase) in long-term prepaid expenses

37,563(48,388)

Other, net

87

2,112

Subtotal

1,000,238

820,23010

10(61,644)(66,074)

(817)

(912)

937,787

753,254(45,699)(6,453,198)－

115,941

Payments into restricted deposits(100,000)(100,000)

Net cash provided by (used in) investing activities(145,699)(6,437,257)

Proceeds from long-term borrowings－

9,579,000

Repayments of long-term borrowings－(6,680,000)

Proceeds from issuance of investment units－

3,179,335

Distributions paid

(773,896)(681,979)

Net cash provided by (used in) financing activities(773,896)

5,396,355

Net increase (decrease) in cash and cash equivalents

18,191(287,646)

Cash and cash equivalents at beginning of period

1,627,550

1,645,741

Cash and cash equivalents at end of period

1,645,741

1,358,094

Interest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment in trust
Proceeds from leasehold and guarantee deposits
received in trust

Cash flows from financing activities－

9－