[For Information Purpose Only]
December 21, 2017
To All Concerned Parties
Name of REIT Issuer:
Invincible Investment Corporation
Name of representative:
Naoki Fukuda, Executive Director
Roppongi Hills Mori Tower
6-10-1 Roppongi, Minato-ku, Tokyo, Japan(Securities code: 8963)
Asset manager:
Consonant Investment Management Co., Ltd.
Naoki Fukuda, CEOContact: Jun Komo
General Manager of Planning Department(Tel. +81-3-5411-2731)
Notice concerning Sale of Assets
Invincible Investment Corporation (“INV”) announced today the sale of assets (the “Sale”)(six residential
properties; Hereafter, individually “Property to be Sold,” or collectively “Properties to be Sold”) decided byConsonant Investment Management Co., Ltd. (“CIM”), the asset manager of INV.

1. Overview of Sale(in JPY million)
Use

Property
number
A31

Residential

A36

A42

A56

A62

A81

Property
nameHarmonie
Ochanomizu
Growth Maison
Ikebukuro
Capital Heights
Kagurazaka
Casa Eremitaggio
Lexel Mansion
Ueno Matsugaya
Sun Terrace
Minami-Ikebukuro
Total(Note 1)

Acquisition
price

Book
1
value

Anticipated2
sales price

Expectedgain on
1
sale

1,428

1,351

1,603

251

825

746

1,057

310

604

626

732

106

Transferee

3

Trust
Undisclosed

1,070

953

1,312

358

970

859

1,329

470

625

595

934

339

5,523

5,132

6,970

1,837

Categoryof specified
assetsBeneficiaryInterest

The difference between anticipated sales price and book value indicates estimate for reference purpose

14

(Note 2)(Note 3)(Note 4)(Note 5)(Note 6)

calculated using the book values as of June 30, 2017; INV estimates to recognize a gain on sales of
JPY1,099 million in the fiscal period ending December 2017, and JPY597 million for the fiscal period
ending June 2018.
Anticipated sales prices do not include adjustments for fixed asset taxes or city planning taxes, or
national or local consumption taxes; hereinafter the same.
The name of the transferee (a Japanese TMK (Tokutei Mokuteki Kaisha)) is not disclosed, as thetransferee’s consent has not been obtained for disclosure. For an overview of the relations between
transferee, please refer to below “4. Overview of Transferee.”
Each of the trust beneficiary interest of Harmoni Ochanomizu, Growth Maison Ikebukuro and Capital
Heights Kagurazaka was integrated in a single trust account with other trust accounts when INV
procured funds through debt financing backed by trust assets (the “Trust Asset-Backed Borrowing”) in
July 2011. In transferring the sole trust beneficiary interest of the abovementioned three properties byitself, INV incurred some expenses to detach from the integrated trust account, effective as ofDecember 22, 2017. For details of Trust Asset-Backed Borrowing and such integration of trust accounts,
please refer to “Notice concerning Fund Procurement through Debt Financing Backed by Trust Assets
and Repayment of Borrowings and Change in Trustee of Trust Assets” dated July 15, 2011.
Amounts are rounded down to the nearest million yen; hereinafter the same.
As set forth in “7. Schedules” below, the scheduled sale date for Casa Eremitaggio, Lexel Mansion
Ueno Matsugaya and Sunterrace Minami-Ikebukuro (collectively the “December Transaction
Properties”) is December 28, 2017 and the scheduled sale date for Harmonie Ochanomizu, Growth
Maison Ikebukuro and Capital Heights Kagurazaka (collectively the “January Transaction Properties”).
As the sale of the six Properties to be Sold is made as an integrated transaction, if the completion of thesale of January Transaction Properties fails to occur for any reason other than those attributable to thetransferee after the completion of the sale of the December Transaction Properties, the Transferee mayelect to either (i) require INV to repurchase all of the December Transaction Properties at the price equal
to their sales prices, or (ii) require INV to make a penalty payment in an amount equal to 10% of thesales prices of January Transaction Properties and reimburse cost incurred by the transferee inconnection with the January Transaction Properties. Further, if the completion of the sale of January
Transaction Properties fails to occur for any reason attributable to the transferee after the completion of
the sale of the December Transaction Properties, INV may elect to require transferee to make a penalty
payment in an amount equal to 10% of the sales prices of January Transaction Properties andreimburse cost incurred by INV in connection with the January Transaction Properties.

2. Reasons for Sale
1

Consistent with the portfolio repositioning transaction announced in July 2017, Invincible is pleased to2

3announce the sale of six residential properties at a NOI cap rate of 4.2% or 3.1% after depreciation for
JPY6,970 million.

This sale is part of INV`s effort to continuously improve its profitability for unitholders.

Moreover, CIM is concurrently planning additional dispositions of its non-core assets4, or officeproperties (the “Follow-on Sale”, and together with the Sale, the “Dispositions”), and the Follow-on Saleis anticipated to be agreed upon with the buyer(s) soon.

INV is also working on several acquisitions to5

invest the cash to be obtained by Dispositions through utilizing the Sponsor pipeline .

The keyhighlights of the Sale are below:(1)

Portfolio repositioning aimed at improving portfolio profitability
The sale of the six residential properties at a cap rate of 4.2% or 3.1% after depreciation is
attractive, especially when compared to the higher NOI yields at which INV has been able toacquire assets in recent years. Thus, INV believes that it can successfully redeploy the capital
into higher yielding properties.

(2)

Realization of profit on sale
The sale price exceeds book value by 36% and appraisal values as of December 1, 2017 by2

15%, respectively and is expected to generate a profit on sale (approximately JPY 1,696 million,of which JPY1,099 million in the fiscal period ending December 2017 and JPY 597 million in thefiscal period ending June 2018); thus INV believes that the sale of these properties at this time isin the interest of INV’s investors.
(3)

Utilization of the Sponsor Pipeline6

INV has the Memorandum of Understanding on Preferential Negotiation Rights with affiliates of
its sponsor, Fortress Investment Group LLC, which covers 21 hotel properties (4,651 guest
rooms) and nine residential properties (743 leasable residential units). INV plans to acquire
properties from this acquisition pipeline, by utilizing the cash to be obtained from the Dispositions,
without issuing new equity. INV intends to acquire properties which have higher yield and NOI
after depreciation than the Properties to be Sold, and thus aims to improve the profitability of theentire portfolio and increase DPU.
(Note1) Please refer to “Notice concerning Acquisition and Sale of Assets” dated July 25, 2017 for details ofsuch portfolio repositioning transaction.
(Note2) Calculated by dividing aggregated actual NOI for July 1, 2016 – June 30, 2017 of Properties to be
Sold by the aggregated anticipated sales price.
(Note3) Calculated by dividing aggregated actual NOI (after deducting the depreciation expenses) for July 1,2016 – June 30, 2017 of Properties to be Sold by the aggregated anticipated sales price.
(Note4) Properties other than Core Assets, i.e., hotels and residential properties(Note5) Follow-on Sale and the abovementioned planned acquisitions will be announced at a later date,when they are determined. Although such sale and acquisition is under consideration as of today,
INV may not determine or execute such sale or acquisition, and there is no assurance that INV will
determine or execute such sale or acquisition.
(Note6)Please refer to the press release “Notice concerning Amendment to Memorandum of Understandingon Preferential Negotiation Rights” dated September 21, 2017 for details of the Memorandum ofUnderstanding.

3. Details of Properties to be Sold
Details, profit and loss status and outline of appraisal report of the Properties to be Sold are as
follows:
a. “Outline of Specified Assets and Properties” column:
・“Legal form of Asset” shows the type (the legal form) of real estate and other assets as
specified asset.
・“Acquisition Date” shows the date when an acquisition is executed, which is specified in thepurchase and sale agreement or the trust beneficiary interest purchase and saleagreement.
・ “Acquisition Price” shows a purchase price of the Properties to be Sold specified in thepurchase and sale agreement or the trust beneficiary interest purchase and saleagreement; consumption tax is not included, and the price is rounded down to the nearest
million yen.
・ The details in “Location” (excluding address), “Lot Area (m2)”of the “Land” and, “Total Floor
3

Area (m2)”, “Structure/No. of Stories,” “Purpose of Use,” and “Completion Date” of the“Building” are, unless otherwise specified, as shown in the property register. The “Total
Floor Area” is the gross floor area (if no annotation in the context, an annex building would
not be included), and with respect to “Purpose of Use,” the primary ones of purposes
shown in the property register are listed. Further, the “Completion Date” lists the time atwhich the building was newly constructed, as shown in the property register.
・ “Transport” shows the time to walk to the nearest station based on the description in theReal Estate Appraisal Report (in case there is no description of time distance in the Real
Estate Appraisal Report, “Transport” is calculated by assuming walking time on the roaddistance of 80 meters per minute in accordance with the Fair Competition Code on theReal Estate Representations (Fair Trade Commission Notification No.2 of 2003, including
subsequent revisions) (hereinafter, referred to as the “Fair Competition Code”) and theOrdinance for Enforcement of the Fair Competition Code. If unidentified, it is based on thedescription in other materials.
・ In “Zoning,” the class of zoning under the respective items of Article 8(1) of the City
Planning Act (Act No. 100 of 1968) is listed.
・ In “Building Coverage Ratio,” the ratio of a building’s area with regard to the land area as
set forth under Article 53 of the Building Standards Act (Act No. 201 of 1950, as amended;
the “Building Standards Act”) is listed.
・ In “Floor Area Ratio,” the ratio of a building’s total floor area with regard to the land area as
set forth under Article 52 of the Building Standards Act is listed.
・ In “Trustee,” the current trustee as of today is listed.
・ In “Master Lease/Property Management Company,” with respect to the properties forwhich a master lease agreement has been entered into, the type of lease (either apass-through master lease or a fixed rent) is indicated. “Pass-through master lease” isdefined as a lease under which, pursuant to the pass-through master lease agreement
entered into between the master lease company and INV or the trustee, the amount equal
to the rent under the sublease agreement between the master lease company and the end
tenant shall be paid to INV or the trustee. “Guaranteed rent” is defined as a lease underwhich a specified rent shall be paid to INV or the trustee, regardless of the rent under thesublease agreement between the master lease company and the end tenant.
b. “Outline of a Lease Contract” column:
・ Based on the lease agreement effective as of June 30, 2017.
・ “Total No. of Tenant(s)” is calculated by counting a lessee who has directly concluded alease agreement for each property as one tenant, and a tenant who has rented two or
more rooms in a single property is calculated as one tenant.
・ In “Leasable Area,” the total leasable floor area for guest room, residential, office, retailand others for the area owned by INV is listed.
・ In “Leased Area,” the total sum of the leased area with respect to which a lease agreementwith an end-tenant has actually been entered into and which are leased to the end-tenant(the area specified in the lease agreement) is listed.
・ In “Tenant Leasehold and Security Deposit,” the amount of the security deposit/guaranteemoney after amortization pursuant to the lease agreement is listed.

4

・ In “Occupancy Trend,” the ratio of the leased area to the leasable area is shown, rounded
to the first decimal place.
c. Descriptions in the “Area Characteristics, etc.” field:
Descriptions in the “Area Characteristics, etc.” field are an abstract or summary ofdescriptions in the Real Estate Appraisal Report on the Properties to be Sold, prepared byappraisal agencies, or created by referring to such descriptions.
d. Descriptions in the “Special Notes”:
Descriptions in the “Special Notes” fields are matters that are deemed important inconsideration of their impact on rights, appraisal value, profitability and disposability ofeach asset.
e. “Income and Expenditures, Etc.” column:
・ Based on the information for operating period from January 1, 2017 to June 30, 2017.
・ Amounts are rounded down to the nearest thousand yen. Therefore, the figures may notnecessarily match the total value when added together. Unless otherwise specifically
noted, the amounts do not include consumption tax, etc.
・ “Taxes and Public Dues” include property tax and city planning tax, which are generally
imposed on the owner on January 1 of each year.
・ ”Non-life Insurance Premiums” is the total amount of paid insurance premiums distributed
proportionally over the relevant period.
f. “Summary of Real Estate Appraisal Report” column:
INV has requested real estate appraisal from appraisal agency for the Properties to be
Sold based on the matters for consideration in a real estate appraisal under the Act on
Investment Trust and Investment Corporations (the “Investment Trust Act”), the Act on
Real Estate Appraisal (Act No. 152 of 1963, as amended; the “Act on Real EstateAppraisal”) and the real estate appraisal standards. An appraisal value of a property ismerely an opinion of the real estate appraiser regarding the value of the appraised
property at the time the appraisal was conducted in accordance with the Act on Real
Estate Appraisal and real estate appraisal standards, etc. A real estate appraisal is neither
a guarantee nor a promise that an asset can be sold or purchased at such appraisal value
either now or in the future.

5

A31: Harmonie Ochanomizu
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mizuho Trust & Banking
Co,. Ltd.

Trustee(Lot Number)

2-94-4, 2-95-1, 2-95-2, 2-95-4, 2-95-5 Yushima, Bunkyo-ku, Tokyo(Address)

2-5-5 Yushima, Bunkyo-ku, Tokyo

LocationTransport

7 minutes' walk from Ochanomizu Station on JR Line etc.

Acquisition Date

August 3, 2006

（JPY thousand）

Operating Period

January 1, 2017～

JPY 1,428 million

Acquisition Price

June 30, 2017

Property Right

Ownership

ZoningCommercial
area/
Neighborhood commercial
area

Land
Lot Area (m2)

588.79Building Coverage /Ratio/Floor Area Ratio

80% / 600%, 80% / 400%

Property Right

Ownership

Condominiums

Purpose of Use
2

Building

Income and Expenditures, Etc.

1,995.59

Total Floor Area (m )Rental revenues (a)41,938Rent Income

38,784

Other income etc.

3,153

Total expenses (b)15,747

Maintenance andmanagement expenses etc.

3,897

Taxes and Public Dues

1,891

Structure/No. of Stories

SRC 14F

Non-Life Insurance
Premiums

Completion Date

March, 1997

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Pacific Development & Management Co., Ltd.

Type of Agreement

40
7,624
2,293

Profit and Loss (a) – (b)26,191

Pass through master lease

NOI (a) – (b) + (c)33,815

1

TenantLeaseholdsecurity deposit

Outline of a Lease Contract
Total number of tenants
2

and

2

Leasable area (m )JPY 7,728 thousand

Leased area (m )1,704.00

1,748.24

Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 2017

88.3%

90.8%

100.0%

100.0%

97.5%

Area Characteristics, etc.

The subject property is a 65-unit condominium primarily for individual tenants, consisting of studios and 1 LDK units, located a 7 minute
walk to the north of the JR Ochanomizu Station. Strong demand is expected from medical personnel due to the close proximity of Tokyo
Medical and Dental University Hospital, and Juntendo University Hospital. In addition, stable leasing to single business people andcorporate company housing is expected as the property has convenient access to the central business district.
Special Notes

None

6

A31: Harmonie Ochanomizu
Summary of Real Estate Appraisal Report
Appraisal Agency

Assets Research and Development Inc.

Appraisal Value (Specified Value)
Time of Valuation

JPY 1,420 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 75,588 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

4,344 thousand Based on current leasing conditions and market(c) Utility Income- Included in other income(d) Parking Lot Income

3,756 thousand Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
4,129 thousand
historical data and market and current income
87,817 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

5,450 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]82,366 thousand(h) Maintenance and Management Costs

2,535 thousand Based on historical data and leasing conditions(i) Utility Costs

1,159 thousand Based on historical data
Based on historical data, comparable assets and estimates
3,223 thousandin the engineering report
1,564 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,849 thousand
historical data and market
3,799 thousand Actual amount
142 thousand Actual amount(j) Repair Costs(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]72 thousand Based on historical data
15,346 thousand
67,020 thousand(p) Investment Gains/Losses of Deposits-(q) Capital Improvements and Expenses

3,854 thousand(V) Net Income = [(IV) + (p) - (q)]63,166 thousand(VI) Capitalization Yield(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]

Based on historical data and comparable assets and theestimates in the engineering report

4.3% Discount rate adjusted for volatility risk
1,470,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.6%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

376,349 thousand

Overview

1,403,691 thousand(b) Sale Costs

42,110 thousand 3% of the sale price(c) Returning Price [(a) - (b)]1,361,580 thousand(II) Returning Price, Present Value

1,020,913 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.2% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.5% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
1,400,000 thousand(3) Income Price using Income Capitalization Method

1,420,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price(ii) Building Price

228,000 thousand(iii) Usual Incidental Costs(iv) Estimated Price using Cost Method = [(i) + (ii) + (iii)]

Overview

JPY 813,000 thousand
118,000 thousand
1,160,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference7A36: Growth Maison Ikebukuro
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mizuho Trust & Banking
Co,. Ltd.

Trustee(Lot Number)

3-31-2 Nishi-Ikebukuro, Toshima-ku, Tokyo(Address)

3-31-14 Nishi-Ikebukuro, Toshima-ku, Tokyo

LocationTransport

5 minutes' walk from Ikebukuro Station on JR Line etc

Acquisition Date

August 3, 2006

Property Right

Ownership

ZoningOperating Period

January 1, 2017～

Commercial area

June 30, 2017
Rental revenues (a)Lot Area (m2)

209.65

Building Coverage /Ratio/Floor Area Ratio
Property Right

26,872Rent Income

25,23880% / 600%

Other income etc.

1,633

Ownership

Total expenses (b)10,035

Condominiums

Purpose of Use
Building（JPY thousand）

JPY 825 million

Acquisition PriceLand

Income and Expenditures, Etc.

2

1,080.95

Total Floor Area (m )Maintenance andmanagement expenses etc.

2,500

Taxes and Public Dues

1,046

Structure/No. of Stories

RC 12F

Non-Life Insurance
Premiums

Completion Date

January 2006

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Pacific Development & Management Co., Ltd.

Type of Agreement

26
5,321
1,139

Profit and Loss (a) – (b)16,836

Pass through master lease

NOI (a) – (b) + (c)22,158

Total number of tenants

1

TenantLeaseholdsecurity deposit

Leased area (m2)

906.97

Leasable area (m2)Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 2017

88.1%

97.6%

97.6%

100.0%

95.2%

Outline of a Lease Contract
and

JPY 4,559 thousand
952.89Area Characteristics, etc.

The subject property is a 42-unit apartment for individual tenants, located a 5 minute walk to the west of JR Ikebukuro Station. The subject
property centrally located near Ikebukuro’s commercial and retail district, one of the busiest downtown areas in Tokyo, making it convenient
for shopping etc. Access from the Ikebukuro Station to various central business districts is excellent, creating steady demand from urban
commuters who are oriented towards convenience, proximity to the city, and convenient transportation options, and a vibrant area foryoung single people.
Special Notes

None

8

A36: Growth Maison Ikebukuro
Summary of Real Estate Appraisal Report
Appraisal Agency

Assets Research and Development Inc.

Appraisal Value (Specified Value)
Time of Valuation

JPY 915 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 48,698 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

3,360 thousand Based on current leasing conditions and market(c) Utility Income- Included in other income(d) Parking Lot Income

1,206 thousand Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,729 thousand
historical data and market and current income
55,994 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

3,025 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]52,969 thousand(h) Maintenance and Management Costs

2,001 thousand Based on historical data and leasing conditions(i) Utility Costs

1,177 thousand Based on historical data
Based on historical data, comparable assets and estimates
1,216 thousandin the engineering report
1,004 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
1,836 thousand
historical data and market
2,090 thousand Actual amount94 thousand Actual amount(j) Repair Costs(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]

703 thousand Based on historical data
10,123 thousand
42,845 thousand(p) Investment Gains/Losses of Deposits-(q) Capital Improvements and Expenses

1,172 thousand(V) Net Income = [(IV) + (p) - (q)]Based on historical data and comparable assets and theestimates in the engineering report

41,673 thousand(VI) Capitalization Yield

4.4% Discount rate adjusted for volatility risk(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]947,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.5%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

246,367 thousand

Overview

905,936 thousand(b) Sale Costs

27,178 thousand 3% of the sale price(c) Returning Price [(a) - (b)]878,758 thousand(II) Returning Price, Present Value

654,411 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.3% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.6% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
901,000 thousand(3) Income Price using Income Capitalization Method

915,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price

Overview

JPY 287,000 thousand(ii) Building Price

198,000 thousand(iii) Usual Incidental Costs

79,600 thousand(iv) Estimated Price using Cost Method = [(i) + (ii) + (iii)]

565,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference9A42: Capital Heights Kagurazaka
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mizuho Trust & Banking
Co,. Ltd.

Trustee(Lot Number)

71-1 Enokicho, Shinjuku-ku, Tokyo & 10-4 Higashi-Enokicho, Shinjuku-ku, Tokyo(Address)

71-1 Enokicho, Shinjuku-ku, Tokyo

LocationTransport

5 minutes' walk from Kagurazaka Station on Tokyo Metro Tozai Line

Acquisition Date

August 3, 2006

（JPY thousand）

Operating Period

January 1, 2017～

JPY 604 million

Acquisition Price

June 30, 2017

Property Right

Ownership

ZoningCommercial
area
Semi-industrial area

Land

2

/

360.50Lot Area (m )Building

Income and Expenditures, Etc.

Building Coverage /Ratio/Floor Area Ratio

80% / 500%, 60% / 400%

Property Right

Ownership

Purpose of Use

Condominium,
Office,Training center, Shop,
Warehouse

Total Floor Area (m2)

1,270.75

Rental revenues (a)19,885

Rent Income

17,917

Other income etc.

1,967

Total expenses (b)7,126Maintenance andmanagement expenses etc.

1,932

Taxes and Public Dues

1,087

Structure/No. of Stories

RC B1/7F

Non-Life Insurance
Premiums

Completion Date

May 1987

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Misui Home Estate Co., Ltd.

Type of Agreement

25
2,630
1,450

Profit and Loss (a) – (b)12,758Pass through master lease

NOI (a) – (b) + (c)15,3891

TenantLeaseholdsecurity deposit

Outline of a Lease Contract
Total number of tenants
2

and

2

Leasable area (m )JPY 6,971 thousand

Leased area (m )939.75

1,126.65

Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 2017

94.4%

97.2%

97.2%

97.2%

83.4%

Area Characteristics, etc.

The subject property is a condominium with two shops and offices located a 5 minute walk to the west of Tokyo metro Kagurazaka
Station. The station adjacent to Kagurazaka Station is Iidabashi Station where the JR line and four Tokyo Metro lines intersect, providing
excellent access to various destinations in Tokyo. Demand is expected from a diverse range of tenants such as students and young urban
propfessionals.
Special Notes

None

10

A42: Capital Heights Kagurazaka
Summary of Real Estate Appraisal Report
Appraisal Agency

Assets Research and Development Inc.

Appraisal Value (Specified Value)
Time of Valuation

JPY 587 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 36,619 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

2,268 thousand Based on current leasing conditions and market(c) Utility Income- Included in other income(d) Parking Lot Income- Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
1,011 thousand
historical data and market and current income
39,898 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

1,944 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]37,953 thousand(h) Maintenance and Management Costs

1,798 thousand Based on historical data and leasing conditions(i) Utility Costs

691 thousand Based on historical data
Based on historical data, comparable assets and estimatesin the engineering report
738 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
1,184 thousand
historical data and market
2,175 thousand Actual amount90 thousand Actual amount(j) Repair Costs

1,522 thousand(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]

8,201 thousand
29,752 thousand(p) Investment Gains/Losses of Deposits-(q) Capital Improvements and Expenses

2,448 thousand(V) Net Income = [(IV) + (p) - (q)]27,304 thousand(VI) Capitalization Yield(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]

Based on historical data and comparable assets and theestimates in the engineering report

4.45% Discount rate adjusted for volatility risk
614,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.8%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

161,782 thousand

Overview

574,825 thousand(b) Sale Costs

17,244 thousand 3% of the sale price(c) Returning Price [(a) - (b)]557,580 thousand(II) Returning Price, Present Value

413,891 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.35% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.75% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
576,000 thousand(3) Income Price using Income Capitalization Method

587,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price

Overview

JPY 497,000 thousand(ii) Building Price

63,600 thousand(iii) Usual Incidental Costs

36,800 thousand(iv) Estimated Price using Cost Method = [(i) + (ii) + (iii)]

597,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference11A56: Casa Eremitaggio
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mitsubishi UFJ Trust andBanking Corporation

Trustee(Lot Number)

1-197-1 Nakane, Meguro-ku, Tokyo(Address)

1-14-15 Nakane, Meguro-ku, Tokyo

LocationTransport

8 minutes' walk from Toritsudaigaku Station on Tokyu Toyoko Line

Acquisition Date

February 1, 2010

Operating Period

January 1, 2017～
June 30, 2017

Property Right

Ownership

ZoningClass one residential area

Lot Area (m2)

Rental revenues (a)433.31

Building Coverage /Ratio/Floor Area Ratio
Property Right

32,586

Rent Income

29,84070% / 300%

Other income etc.

2,745

Ownership

Total expenses (b)14,713

Condominium / Shop

Purpose of Use
Building（JPY thousand）

JPY 1,070 million

Acquisition PriceLand

Income and Expenditures, Etc.

2

1,523.48

Total Floor Area (m )Maintenance andmanagement expenses etc.

2,813

Taxes and Public Dues

1,652

Structure/No. of Stories

RC B1/9F

Non-Life Insurance
Premiums

Completion Date

December 2003

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Pacific Development & Management Co., Ltd.

Type of Agreement

32
9,221
993

Profit and Loss (a) – (b)17,872

Pass through master lease

NOI (a) – (b) + (c)27,094

Total number of tenants

1

TenantLeaseholdsecurity deposit

Leased area (m2)

1,124.81

Leasable area (m2)Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 201784.2%

100.0%

100.0%

96.7%

94.0%

Outline of a Lease Contract
and

JPY 8,209 thousand
1,197.19

Area Characteristics, etc.

The subject property is a condominium located an 8 minute walk to the southwest of Tokyu Line Toritsudaigaku Station. The Tokyu Toyoko
Line provides a ten minute commute by train to Shibuya Station, a major retail and transportation hub. In addition, the building is a designer
condominium consisting of 17 units including residential, stores and offices, which has been featured in various magazines and TV
programs. The distinguished interior design and outer appearance has strong appeal compared to surrounding condominiums in the area.
Special Notes

None

12

A56: Casa Eremitaggio
Summary of Real Estate Appraisal Report
Appraisal Agency

Japan Real Estate Institute

Appraisal Value (Specified Value)
Time of Valuation

JPY 1,120 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 57,068 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

1,356 thousand Based on current leasing conditions and market(c) Utility Income-(d) Parking Lot Income

4,302 thousand Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
5,038 thousand
historical data and market and current income
67,764 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

4,240 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]63,524 thousand(h) Maintenance and Management Costs

3,264 thousand Based on historical data and leasing conditions(i) Utility Costs

1,500 thousand Based on historical data
Based on historical data, comparable assets and estimates
1,508 thousandin the engineering report
1,172 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,848 thousand
historical data and market
3,280 thousand Actual amount57 thousand Actual amount(j) Repair Costs(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]

13,629 thousand
49,895 thousand(p) Investment Gains/Losses of Deposits

72 thousand(q) Capital Improvements and Expenses

2,291 thousand(V) Net Income = [(IV) + (p) - (q)]47,676 thousand(VI) Capitalization Yield(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]

Based on historical data and comparable assets and theestimates in the engineering report

4.2% Discount rate adjusted for volatility risk
1,140,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.4%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

390,020 thousand

Overview

1,089,227 thousand(b) Sale Costs

32,677 thousand 3% of the sale price(c) Returning Price [(a) - (b)]1,056,550 thousand(II) Returning Price, Present Value

713,805 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.0% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.4% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
1,100,000 thousand(3) Income Price using Income Capitalization Method

1,120,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price(ii) Building Price

197,000 thousand(iii) Correction Factor for Stabilized Asset(iv) Estimated Price using Cost Method = [((i) + (ii)) x (iii)]

Overview

JPY 490,000 thousand
120%
824,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference13A62: Lexel Mansion Ueno Matsugaya
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mitsubishi UFJ Trust andBanking Corporation

Trustee(Lot Number)

3-409-2 Matsugaya, Taito-ku, Tokyo(Address)

3-10-2 Matsugaya, Taito-ku, Tokyo

LocationTransport

8 minutes' walk from Iriya Station on Tokyo Metro Hibiya Line etc.

Acquisition Date

February 1, 2010

Property Right

Ownership

ZoningCommercial area

Lot Area (m2)

Operating Period

January 1, 2017～
June 30, 2017

Rental revenues (a)438.60

Building Coverage /Ratio/Floor Area Ratio

100% / 500%

Property Right

Ownership

Condominium

Purpose of Use
Building（JPY thousand）

JPY 970 million

Acquisition PriceLand

Income and Expenditures, Etc.

2

2,196.49

Total Floor Area (m )35,106

Rent Income

31,078Other income etc.

4,027

Total expenses (b)16,982

Maintenance andmanagement expenses etc.

4,381

Taxes and Public Dues

1,866

Structure/No. of Stories

SRC 12F

Non-Life Insurance
Premiums

Completion Date

January 2005

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Pacific Development & Management Co., Ltd.

Type of Agreement

41
8,553
2,138

Profit and Loss (a) – (b)18,123

Pass through master lease

NOI (a) – (b) + (c)26,677

Total number of tenants

1

TenantLeaseholdsecurity deposit

Leased area (m2)

1,826.63

Leasable area (m2)Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 2017100.0%

100.0%

100.0%

96.4％

92.7％

Outline of a Lease Contract
andJPY 6,713 thousand
1,969.45

Area Characteristics, etc.

The subject property is a family type rental apartment located an 8 minute walk to the south-east of Tokyo Metro Iriya Station. The property
is conveniently located in the Matsugaya area, providing residents a close proximity to the downtown business district centering on
Marunouchi and Otemachi. This area is popular among residents who prefer an area with a distinct local atmosphere.
Special Notes

None

14

A62: Lexel Mansion Ueno Matsugaya
Summary of Real Estate Appraisal Report
Appraisal Agency

The Tanizawa Sōgō Appraisal Co., Ltd.

Appraisal Value (Specified Value)
Time of Valuation

JPY 1,230 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 63,290 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

2,481 thousand Based on current leasing conditions and market(c) Utility Income- Included in other income(d) Parking Lot Income

6,048 thousand Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,759 thousand
historical data and market and current income
74,578 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

5,707 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]68,871 thousand(h) Maintenance and Management Costs

1,937 thousand Based on historical data and leasing conditions(i) Utility Costs

1,063 thousand Based on historical data
Based on historical data, comparable assets and estimates
2,191 thousandin the engineering report
1,322 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
1,392 thousand
historical data and market
3,749 thousand Actual amount82 thousand Actual amount(j) Repair Costs(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]

1,239 thousand
12,979 thousand
55,892 thousand(p) Investment Gains/Losses of Deposits

53 thousand-(q) Capital Improvements and Expenses

2,500 thousand(V) Net Income = [(IV) + (p) - (q)]53,445 thousand(VI) Capitalization Yield(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]

Based on historical data and comparable assets and theestimates in the engineering report

4.3% Discount rate adjusted for volatility risk
1,240,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.5%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

430,000 thousand

Overview

1,230,000 thousand(b) Sale Costs

20,000 thousand 2% of the sale price(c) Returning Price [(a) - (b)]1,210,000 thousand(II) Returning Price, Present Value

790,000 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.3% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.5% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
1,220,000 thousand(3) Income Price using Income Capitalization Method

1,230,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price(ii) Building Price(iii) Estimated Price using Cost Method = [(i) + (ii)]

Overview

JPY 570,000 thousand
470,000 thousand
1,040,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference15

A81: Sun Terrace Minami Ikebukuro
Outline of Specified Assets and Properties.
Legal Form of Asset

Trust Beneficiary Interest

Mitsubishi UFJ Trust andBanking Corporation

Trustee(Lot Number)

2-96-6 Minami Ikebukuro, Toshima-ku, Tokyo and other 2 lots

(Address)

2-22-6 Minami-Ikebukuro, Toshima-ku, Tokyo

LocationTransport

4 minutes' walk from Ikebukuro Station on JR Line etc.

Acquisition Date

September 28, 2012

Property Right

Ownership

ZoningCommercial area

Lot Area (m2)

Operating Period

January 1, 2017～
June 30, 2017

Rental revenues (a)181.61

Building Coverage /Ratio/Floor Area Ratio

100% / 600%

Property Right

Ownership

2

965.85

Total Floor Area (m )22,564

Rent Income

20,496

Other income etc.

2,068

Total expenses (b)10,505Maintenance andmanagement expenses etc.

Condominium

Purpose of Use
Building（JPY thousand）

JPY 625 million

Acquisition PriceLand

Income and Expenditures, Etc.

2,924

Taxes and Public Dues

919
26
5,212

Structure/No. of Stories

SRC 11F

Non-Life Insurance
Premiums

Completion Date

February 1998

Depreciation (c)Other expenses

Master Lease/Property
Management Company

Goodworks Co., Ltd.

Type of Agreement

1,420

Profit and Loss (a) – (b)12,059Pass through master lease

NOI (a) – (b) + (c)17,272

Total number of tenants

1

TenantLeaseholdsecurity deposit

Leased area (m2)

780.45

Leasable area (m2)Occupancy Trend

As of the end ofJun. 2015

As of the end of
Dec. 2015

As of the end ofJun. 2016

As of the end of
Dec. 2016

As of the end ofJun. 2017

97.4%

97.4%

100.0%

97.4%

86.8%

Outline of a Lease Contract
and

JPY 3,620 thousand
898.70Area Characteristics, etc.

The subject property provides excellent access to Ikebukuro Station, a four minute walk to one of Tokyo’s terminal stations serving 8 train
lines from operators such as JR Lines, Tokyo Metro Lines, the Tobu Line and the Seibu Line. JR Ikebukuro Station is a vibrant area and ishost to commercial facilities, centering on large department stores as well as electronic retail stores, specialty retail stores, and restaurants.
The property is a rental apartment targeting individuals and consists of 38 1K units. Access from the Ikebukuro Station to various central
business districts is excellent, creating steady demand from urban commuters who are oriented towards convenience, proximity to the city,and convenient transportation options, and a vibrant area for young single people.
Special Notes

None

16

A81: Sun Terrace Minami Ikebukuro
Summary of Real Estate Appraisal Report
Appraisal Agency

Japan Real Estate Institute

Appraisal Value (Specified Value)
Time of Valuation

JPY 761 million
December 1, 2017

1. Value of Profits using the Income Approach Method(1) Direct Capitalization Method(a) Rental Income

Contents

Overview

JPY 42,933 thousand Based on current leasing conditions and market(b) Common Area Maintenance Fee Income

1,764 thousand Based on current leasing conditions and market(c) Utility Income-(d) Parking Lot Income

720 thousand Based on current leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,984 thousand
historical data and market and current income
48,401 thousand(e) Other Income(I) Total Potential Revenue = [(a) + (b) + (c) + (d) + (e)](f) Vacancy Allowance

2,432 thousand Based on historical trend and market(g) Irrecoverable Debt Losses-(II) Operating Revenue = [(I) - (f) - (g)]45,969 thousand(h) Maintenance and Management Costs

1,780 thousand Based on historical data and leasing conditions(i) Utility Costs

770 thousand Based on historical data
Based on historical data, comparable assets and estimatesin the engineering report
885 thousand Based on historical data, leasing conditions and market
Based on turnover reflecting current leasing conditions,
2,330 thousand
historical data and market
1,865 thousand Actual amount47 thousand Actual amount(j) Repair Costs

1,717 thousand(k) Property Management Fee(l) Tenant Solicitation Expenses(m) Taxes and Public Dues(n) Non-Life Insurance Premiums(o) Other Costs(III) Operating Costs (Expense Rate) = [(h) + (i) + (j) + (k) + (l) + (m)+ (n) + (o)](IV) Net Operating Income = [(II) - (III)]9,394 thousand
36,575 thousand(p) Investment Gains/Losses of Deposits

35 thousand(q) Capital Improvements and Expenses

2,638 thousand(V) Net Income = [(IV) + (p) - (q)]33,972 thousand(VI) Capitalization Yield(VII) Income Price using Direct Capitalization Method = [(V) / (VI)]

Based on historical data and comparable assets and theestimates in the engineering report

4.4% Discount rate adjusted for volatility risk
772,000 thousand(Reference) NOI Yield = [(IV) / (VII)]

4.7%(2) DCF Method

Contents(I) Total of Present Value of Net Income during Analysis Period(a) Sale Price

273,219 thousand

Overview

740,870 thousand(b) Sale Costs

22,226 thousand 3% of the sale price(c) Returning Price [(a) - (b)]718,644 thousand(II) Returning Price, Present Value

476,245 thousand(V) Income Price using DCF Method = [(I) + (II)]Based on the standard rate which is risk-free rate adjusted
4.2% for real estate investment risk, liquidity and safety and asset
characteristics including building age, size and tenant profile
Based on risks such as uncertainty over future income,
4.6% building age at the end of valuation period and market
competitiveness and discount rate adjusted for volatility risk
749,000 thousand(3) Income Price using Income Capitalization Method

761,000 thousand(III) Discount Rate

(IV) Final Capitalization Yield

2. Estimated Price using Cost Method
Contents(i) Land Price(ii) Building Price

141,000 thousand(iii) Correction Factor for Stabilized Asset(iv) Estimated Price using Cost Method = [((i) + (ii)) x (iii)]

Overview

JPY 265,000 thousand
130%
528,000 thousand

Other Points to be Noted for Appraisal by Appraisal Agency
Adopted the appraisal value determined using the income capitalization method, after considering recent economic environment, especially real estatemarket trend and appropriateness of using data, pricing rule, relationship between unit price and gross price, with the cost approach value as a reference174. Overview of Transferee
Because consent for disclosure has not been obtained from the transferee (a Japanese TMK(Tokutei Mokuteki Kaisha)) of the Property to be Sold, disclosure is not made here.
As of today, there are no capital, personnel, or transactional relationships that should be noted
between INV/CIM and the transferee. Further, the transferee is not a related party of INV or CIM,
and as of today, the transferee is not an interested person etc. as provided in the Investment Trust
Act or a sponsor-related person under the voluntary rules specified by CIM as countermeasuresagainst conflicts of interests in the management of INV’s investments.
5. Transactions with Interested Persons etc.
Not applicable.
6. Overview of Brokerage
Because consent for disclosure has not been obtained from the brokers, disclosure is not made here.
The brokerage with regard to the Properties to be Sold has been jointly conducted by twocompanies.
As of today, there are no capital, personnel or transactional relationships that should be noted
between INV/CIM and each of the brokers. Further, each of the brokers is not a related party of INV
or CIM, and as of today, each of the brokers is not an interested person etc. as provided in theInvestment Trust Act or a sponsor-related person under the voluntary rules specified by CIM as
countermeasures against conflicts of interests in the management of INV’s investments.
7. Schedules
Sale decision date:
Agreement execution date:

Anticipated sales date:

Anticipated sale proceeds payment method:(Note)

December 21, 2017
December 28, 2017
(Casa Eremitaggio, Lexel Mansion Ueno
Matsugaya, Sun Terrace Minami-Ikebukuro)
January 31, 2018
(Harmonie Ochanomizu, Growth Maison
Ikebukuro, Capital Heights Kagurazaka)
Lump-sum payment

As the sale of the six Properties to be Sold is made as an integrated transaction, if the completion of thesale of January Transaction Properties fails to occur for any reason other than those attributable to thetransferee after the completion of the sale of the December Transaction Properties, the transferee mayelect to require INV to repurchase all of the December Transaction Properties at the price equal to theirsales prices or to pay certain penalties. Please refer to “1. Overview of Sale” above.

8. Use of Sale Proceeds
The sale proceeds that INV will obtain through the Sale is expected to be allocated to acquire newproperties, in conjunction with the sale proceeds to be obtained through the Follow-on Sale.

18

9. Future Outlook
Through the Sale, INV will record a gain on sale of approximately JPY1,099 million in the fiscal
period ending December 2017, and approximately JPY597 million in the fiscal period ending June
2018, respectively. Such gain on sale is subject to change, as INV anticipates some gain or loss on
disposition through the Follow-on Sale which has been under consideration as of today.
In the press release “Notice concerning Revision of Forecast of Financial Results and Distribution forthe 29th Fiscal Period Ending December 2017” dated September 21, 2017, INV stated that earnings
per unit is expected to decrease due to one-off expenses in connection with the public offering andthe new borrowings of funds and that INV intends to make distributions in excess of profits from theperspective of maintaining stable distributions. The gain on sale to be obtained from the Dispositions,however, will increase net income per unit, thus INV plans to reduce the amount of distribution inexcess of profits by an amount equivalent to the gain on sale to be obtained from the Dispositions sothat INV will be able to maximize an amount of future acquisitions utilizing the sale proceed from the
Dispositions which we believe maximizes INV’s unitholders value. Therefore, INV does not makeany changes to forecast of the total amount of distribution and distribution per unit at this stage.
INV intends to announce the detail of revision to the forecasts of the financial results for the fiscal
period ending December 2017, once the Follow-on Sale and the detail thereof is determined.

Website of INV: http://www.invincible-inv.co.jp/eng

19