Ichigo Hotel (3463)

Ichigo Hotel July 2022 Fiscal Period
Corporate Presentation
September 14, 2022

Ichigo Hotel REIT Investment Corporation (3463)
Ichigo Investment Advisors Co., Ltd.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

www.ichigo-hotel.co.jp/en

We would like to express our deepest condolences
to all those affected by the global Covid pandemic
and by the war and humanitarian crisis in Ukraine,
along with our heartfelt wish for the immediate
cessation of hostilities in Ukraine and the earliest
and fullest possible recovery for all.
Take care, be safe.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

2

Make The World
More Sustainable© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

July 2022 Results July 2022 Highlights
 July 2022 Earnings Breakdown
 YOY Increases in Revenue, RevPAR,
Occupancy, & ADR
 RevPAR Increase YOY in All Regions
 Full Recovery in Occupancy to Pre-Covid
Level
 Ichigo Hotel Portfolio Occupancy Exceeds
Market Recovery
 Increasing Stability via Contract Renewals &Rebranding External Growth: Strengthened Portfolio via
Hotel Acquisition
 Shareholder Program (1) Shareholder
Discount Program Shareholder Program (2) Ichigo J.League
Shareholder Program

Ichigo’s Commitment to ESG
 Climate Positive: CO2 Reduction > Emissions
 Ichigo Sustainability Policy RE100 by 2025 On Track Full ESG Transparency & Disclosure Ichigo ESG – Environmental
 Ichigo ESG – Social
 Ichigo ESG – GovernanceAppendices Portfolio Details
 Loan Details & Shareholder Composition Growth Roadmap, Sponsor, Shareholder
Alignment

Sustainability as a Key Management Priority
 Sustainability Initiatives
 Market Environment & Forecast Assumptions
 January 2023 Forecast
 July 2023 Forecast© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

6

July 2022 Results© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

7

July 2022 Highlights
Results
Asset
Acquisition

Comfort Hotel Nagano

Net Income

JPY 361M

RevPAR(Acquisition Price JPY 670M)+JPY 50M (+16.2%) vs. revised forecast

JPY 4,348 (15 variable rent hotels)+JPY 377 (+9.3%) vs. revised forecast

Details• Expected to capture both business and leisure demand• Acquired with cash-on-hand• +JPY 93M (+34.5% YOY)
• +JPY 148M (+69.5%) vs. initial forecast announced on
Mar 2022• Occupancy: 84.7% (vs. 78.1% forecast)• ADR: JPY 5,132 (vs. JPY 5,084 forecast)NOI

JPY 1,052M+JPY 63M (+6.4%) vs. revised forecast• Increase in variable rent
• +JPY 185M, +21.3% vs. initial forecast announced on
Mar 2022

FFO

JPY 2,853• FFO up on NOI increase

Dividend

JPY 1,418+JPY 198 (+16.2%) vs. revised forecast• Operating Revenue increase driving Dividend increase• +JPY 580, +69.2% vs. initial forecast announced on Mar
2022

NAV

JPY 129,964• Total unrealized gains: JPY 1.5B

+JPY 435 (+18.0%) YOY+JPY 1,195 (+0.9%) vs. previous period

FFO (Funds from Operations) = (Net Income + Depreciation + Amortization of Expenses Related to REIT Establishment + Amortization of Share Issuance Expenses+ Loss on Disposal of Fixed Assets + Accrued Asset Disposal Costs +/- Losses/Gains on Sales +/- Extraordinary Losses/Gains) / Number of Shares Outstanding
NAV = BPS + Unrealized Capital Gains per Share© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

8

July 2022 Earnings Breakdown(JPY million)

Jul 2021
ActualJul 2022
Actual (A)Forecast (B)(Jul 2022)

vs.
Forecast(A) - (B)

Forecast(Mar 2022)

Major Variation Factors (vs. Forecast)

Operating Revenue

1,117

1,248

1,197

+51

1,069

Variable Rent

126

302

243

+59

122

Increase in variable rent +62 (Nagoya, Sapporo Ekimae,
Valie Hiroshima, Sapporo Odori, Kumamoto, Asagaya,
Matsuyama, Yokohama)Fixed Rent

947

900

908

-8

902

Decrease in fixed rent (Okayama)

Other (Gains on Sales, etc.)

44

45

44

+1

45

652

681

681

–

647

Repair & Maintenance

46

38

49

-11

44

Depreciation

347

364

360

+4

351

Operating Profit

465

566

515

+51

421

Recurring Profit

269

362

312

+50

214

Net Income

268

361

311

+50

213

Dividend

JPY 1,055

JPY 1,418

JPY 1,220+JPY 198

JPY 838FFO

JPY 2,418

JPY 2,853

–

–

–

NOI

912

1,052

989

+63

867

Post-Depreciation NOI

565

687

628

+59

515

Capex

335

199

283

-84

283

52,06452,445–––

Operating Expenses

Book Value© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Decrease due to unused reserve+16.2% vs. Revised forecast announced on Jul 2022
+69.2% vs. Initial forecast announced on Mar 2022
+34.4% YOY (+JPY 363)

Decrease due to shift in renovation schedule9

YOY Increases in Revenue, RevPAR, Occupancy, & ADR
Variable Rent Hotels (15 Hotels)

Feb 1, 2021
- Jul 31, 2021

Feb 1, 2022
- Jul 31, 2022

ChangeYOY

Feb 1, 2019
- Jul 31, 2019

Room Revenue (JPY M)

1,008

1,852

+844

+83.7%

2,583

Total Revenue (JPY M)

1,140

1,988

+848

+74.4%

2,902

RevPAR (JPY)

2,865

4,348

+1,483+51.8%

7,104

Occupancy

65.4%

84.7%

+19.3%+29.6%

86.4%

ADR (JPY)

4,381

5,132

+751

+17.1%

8,218

Total Portfolio (21 Hotels)

Feb 1, 2021
- Jul 31, 2021

Feb 1, 2022
- Jul 31, 2022

ChangeYOY

Feb 1, 2019
- Jul 31, 2019

Room Revenue (JPY M)

1,456

2,520

+1,064+73.1%

3,722

Total Revenue (JPY M)

1,598

2,672

+1,074+67.2%

4,069

RevPAR (JPY)

2,740

4,162

+1,422+51.9%

6,853

Occupancy

58.3%

77.8%

+19.4%+33.3%

86.2%

ADR (JPY)

4,696

5,351

+655

+13.9%

7,946

Feb 1, 2019 – Jul 31, 2019 data excludes HOTEL EMIT SHIBUYA acquired on February 25, 2020. Data excludes Capsule Plus Yokohama and Washington Hotel
Plaza Shimonoseki Eki Nishi. Change and YOY calculations exclude Comfort Hotel Nagano acquired on May 31, 2022. Operating results before acquisition are
based on data provided by previous owner.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

10

RevPAR Increase YOY in All Regions
YOY by Region (Feb 2022– July 2022)
RevPAR

Occupancy

ADR

Total
Portfolio

Hokkaido

Tokyo

21 Hotels (excludes Capsule Plus Yokohama, Washington Hotel
Plaza Shimonoseki Eki Nishi, and Comfort Hotel Nagano)

Tokai/
Chubu

Kyoto

Osaka

Kobe

+632%
+614%

Chugoku/
Shikoku

Kyushu

+161%

+113%

+53%
+33%
+15%

+65%
+36%
+22%

+95%

+88%
+67%

+64%

+41% +37%+29%+20%

+22%

+13%

+3%

+53%

+42%
+37%

+8%

+7%
-3%

(JPY)

RevPAR

5,024

5,709

4,398

2,262

2,360

4,696

4,059

4,704

No. Hotels

3

3

4

1

2

1

5

2

% of Total
Portfolio Rental
Income

9%

13%

23%

3%

6%

4%

27%

11%

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

11Full Recovery in Occupancy to Pre-Covid Level
Variable Rent Hotels (Jan 2020 – July 2022)
RevPAR

Occupancy

ADR

84.7%

84.4%

68.8%
65.4%

7,302

54.9%

6,166

50.4%
5,132

5,020

2,531

Jan 2020

4,383

Jul 2020

Jan 2021

4,348

3,112

2,865

2,408

4,522

4,381

Jul 2021

Jan 2022

Jul 2022(JPY)

No. Hotels

14

15

15

15

15

15

RevPAR

6,166

2,531

2,408

2,865

3,112

4,348

Occupancy

84.4%

50.4%

54.9%

65.4%

68.8%

84.7%

ADR

7,302

5,020

4,383

4,381

4,522

5,132

Excludes Capsule Plus Yokohama© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

12

Ichigo Hotel Portfolio Occupancy Exceeds Market Recovery− Hotel demand recovery continues− Ongoing recovery expected due to government lifting Covid-related restrictions
and expanding inbound travel− Covid impact on business hotels was minimal compared to other hotel types
Ichigo Hotel Occupancy (vs. 2019) and Hotel Reservations+40%
Ichigo Hotel Occupancy

Business Hotels

Full-Service Hotels

Resort Hotels

Japanese Inns

Number of Guests

+20%

0%

-20%

-40%

-60%

-80%

-100%

Jan
2020

Feb

Mar

Apr

May

June

Jul

Aug

Sept

Oct

Nov

Dec

Jan
2021

Feb

Mar

Apr

May

June

Jul

Aug

Sept

Oct

Nov

Dec

Jan
2022

Feb

Mar

Apr

May

June

* Calculated by Ichigo Investment Advisors based on Japan Tourism Agency (JTA) “Statistical Survey of Travelers”© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

13

Increasing Stability via Contract Renewals & Rebranding
TimingHotel Name

Lease Terms

ChangesJun 2020

Smile Hotel Tokyo Asagaya

Variable+Fixed
Rent

Lease Renewal

Oct 2020

The OneFive Okayama(formerly Comfort Hotel Okayama)

Fixed Variable+Fixed
Rent

Rebranding• Operator change to Hakata Hotels• Increased fixed rent & added variable rent

Oct 2020

The OneFive Fukuoka Tenjin(formerly Valie Hotel Tenjin)

Variable+Fixed
Rent

Rebranding• Operator change to Hakata Hotels• Revised variable rent

Feb 2021

Capsule Plus Yokohama(formerly Grandpark-Inn Yokohama)Fixed Variable Rent

Rebranding• Added GOP-linked variable rent

Aug 2021

Hotel Wing International Nagoya

Variable+Fixed
Rent

Lease Renewal

Sep 2021

The OneFive Osaka Sakaisuji(formerly Chisun Inn
Osaka Hommachi)

Variable+Fixed
Rent

Rebranding• Operator change to Hakata Hotels• Revised variable rent

Feb 2022

The OneFive Garden Kurashiki(formerly Court Hotel Kurashiki)

Variable+Fixed
Rent

Rebranding• Operator change to Hakata Hotels

Dec 2022

Comfort Hotel Nagano

Fixed Rent

Lease
Termination• Currently in selection process from multiple© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

• Increased fixed rent
• Revised variable rent

• Decreased fixed rent
• Revised variable rent

operator candidates

14

External Growth

Strengthened Portfolio via Hotel Acquisition (1)Comfort Hotel Nagano (Acquisition Price JPY 670M, Acquired on May 31, 2022)• A lodging-focused hotel located in Nagano City, one of the major cities in the Kanto
Koshinetsu Area
• Acquired using proceeds from a Jan 2020 hotel sale & cash-on-hand• Pre-Covid level occupancy & ADR contributing to portfolio earnings stability• Hotel operator change scheduled upon current contract-end in Dec 2022 to drive increased
income© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

15

External Growth

Strengthened Portfolio via Hotel Acquisition (2)Hotel Sunshine Utsunomiya (Acquisition Price JPY 2.2B, Acquired on Sep 20, 2022)• A lodging-focused hotel located in Utsunomiya City of Tochigi Prefecture, the largest city in
the North Kanto area
• Stable business demand from one of Japan’s largest industrial parks & corporate research
institutes in the area
• Acquired using proceeds from Jan 2020 hotel sale & cash-on-hand• A retail complex with a convention hall to be completed on the eastern side of Utsunomiya
Station by Nov 2022; Light Rail Transit, a next-generation streetcar system, to start
operations in Aug 2023
• Fixed-rent lease hotel acquisition to drive portfolio earnings stability© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

16

Shareholder Program (1)Shareholder Discount Program
Program Established to Express Gratitude to Ichigo Hotel Shareholders andto Support the Hotel Industry Impacted by Covid
Special Discount Rates (including hotels not owned by Ichigo Hotel)
Minacia Co., Ltd.
 Hotel Wing International
 Special rate 12% lower than rates on hotel website
 39 Hotel Wing International Hotels located across Japan,
from Hokkaido to Kagoshima

K.K. Hospitality Operations
 Smile Hotels
 Special rate 10% lower than rates on hotel website
 68 Smile Hotel and Hotel Emisia brand hotels locatedacross Japan, from Hokkaido to Okinawa© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

17

Shareholder Program (2)Ichigo J.League Shareholder Program
Represents Two Firsts for a Shareholder Program in Japan− First Japanese company to include not just its own shareholders, but also theshareholders of the REITs and YieldCo that it manages, in its shareholder program(70,000 shareholders total)− First company to offer shareholders free tickets to every J.League game at every
J.League club

Ichigo is deepening its partnership with the J.League and working tofurther Ichigo’s mission of promoting local community development.

Ichigo J.League Shareholder Program Website Landing Page
© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

18

Sustainability as a Key Management Priority© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

19

Sustainability Initiatives (1)Minimizing Environmental Impact of Ichigo Hotel-Owned Assets
Environmental Certifications− HOTEL EMIT SHIBUYA (BELS 4 Stars)− Joined GRESB Real Estate Assessment in 2021
− Awarded 2 Stars in GRESB rating− Won Green Star designation− Energy efficiency assessments for 2 hotels to be conducted

Energy Efficiency Improvements− Conducting planning and research to reduce energy consumption via installing
LED lights and water-saving systems across all hotels

Disclosure of Energy Consumption Levels and Energy Reduction Targets− Aiming to disclose energy consumption levels and energy reduction targets on
the Ichigo Hotel website by January 2023

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

20

Sustainability Initiatives (2)Shift to Renewable Energy− Began sourcing renewable energy at 9 hotels as of July 2022 fiscal period− 15 remaining hotels to be transitioned sequentially
Renewable Energy
Transition Completed
Court Hotel Suzuka
HOTEL EMIT SHIBUYA
Nest Hotel Sapporo Ekimae
Nest Hotel Sapporo Odori
The OneFive Fukuoka Tenjin

The OneFive Okayama
Capsule Plus Yokohama
The OneFive Osaka Sakaisuji
Smile Hotel Kyoto Shijo

RE100
A global initiative bringing together businesses committed to 100% renewable electricity, including solar, wind, hydro, and biomassenergy, and accelerating the change towards a zero-carbon society.
Ichigo (2337), Ichigo Hotel’s sponsor, joined RE100 in February 2021 and set a target to source 100% renewable electricity acrossits operations, including Ichigo Hotel (3463) and Ichigo Office (8975), by 2025.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

21

Market Environment & Forecast Assumptions
Hotel Market Continues Recovery
Occupancy and ADR Forecasts for 15 Variable Hotels− Forecasting Occupancy at -10~-20%, ADR at -30~-40%, and RevPAR -40%~-50% vs. 2019 (Pre-Covid) levels
July 2019
ActualOccupancy

July 2020
ActualJuly 2021
ActualJuly 2022
ActualJuly 2023
Forecast

YOY

86.2%

49.9%

65.4%

84.7%

77.9%

-8.1%

ADR

JPY 8,475

JPY 5,102

JPY 4,381

JPY 5,132

JPY 6,409+24.9%

RevPAR

JPY 7,307

JPY 2,544

JPY 2,865

JPY 4,348

JPY 4,990+14.8%

January 2019
ActualJanuary 2020
ActualJanuary 2021
ActualJanuary 2022
ActualJanuary 2023
Forecast

92.0%

84.3%

54.9%

68.8%

76.8%

+11.6%ADR

JPY 8,242

JPY 7,428

JPY 4,383

JPY 4,522

JPY 5,505+21.7%

RevPAR

JPY 7,586

JPY 6,259

JPY 2,408

JPY 3,112

JPY 4,226+35.8%

Occupancy

YOY* Data of 11 hotels for January 2019 fiscal period, 12 hotels for July 2019 fiscal period, 13 hotels for January 2020 fiscal period, 14 hotels
for July 2020 fiscal period, and 15 hotels for January 2021 fiscal period and onward© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

22

January 2023 Forecast
Dividend JPY 1,106, -17.8% YOY
 Decrease in Dividend YOY due to fall-off of previous period’s
extraordinary gain, despite YOY NOI increase
Jan 2022
Actual (A)Jan 2023
Previous
Forecast(Mar 2022)

Jul 2023
Revised
Forecast (B)Major Factors for Variation(B) - (A)Operating Revenue

1,125

1,093

1,205

+80

Variable Rent

147

135

180

+33

Fixed Rent

933

912

974

+41

Other (Gains on Sales, etc.)

44

45

50

+6

653

642

690

+37

Repair & Maintenance

34

35

42

+8

Depreciation

355

351

371

+16

Operating Profit

472

451

514

+42

Recurring Profit

274

219

283

+9

Borrowing-related expenses/Interest expenses +26
Fall-off of non-operating income -7

Net Income

342

218

282

-60

Fall-off of extraordinary gains -69

JPY 1,345

JPY 858

JPY 1,106-JPY 239

NOI

938

901

998

+60

Post-Depreciation NOI

583

550

627

+44

Capex

206

456

513

+307

Operating Expenses

Dividend(JPY million)

Increase in variable rent +117 (Kumamoto, Sapporo Ekimae, Yokohama, Nagoya,Matsuyama, Sapporo Odori, Kurashiki, Asagaya)
Decrease in variable rent -84 (Valie Hiroshima)*Due to termination of contract
leasing all rooms
Increase in fixed rent +73 (Utsunomiya, Nagano, Fukuoka, Osaka Sakaisuji)
Decrease in fixed rent -32 (Kurashiki, Nagoya)

Increase in property tax +8, Management outsourcing fee +2
AM fee +9, Administration fees -6-17.8% YOY+28.9% (+JPY 248) vs. previous forecast

Change in hotel operator (Nagano)
Equipment upgrades (Valie Hiroshima, Kurashiki, Osaka Sakaisuji)© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

23

July 2023 Forecast
Dividend JPY 1,380, -2.7% YOY
 YOY NOI increase; Conservative forecast of non-operating expenses(JPY million)
Jul 2022
Actual (A)Operating Revenue

1,248

Jul 2023
Forecast (B)1,326

Major Factors for Variation(B) - (A)+78

Variable Rent

302

305

+3

Increase in variable rent +164 (Sapporo Ekimae, Sapporo Odori, Matsuyama,
Yokohama, Osaka Sakaisuji, Nagano)
Decrease in variable rent -161 (Valie Hiroshima, Kumamoto, Nagoya)*Due to termination of contracts leasing all rooms

Fixed Rent

900

972

+72

Increase in fixed rent +76 (Utsunomiya, Kurashiki, Osaka Sakaisuji)
Decrease in fixed rent -4 (Nagano, Okayama)

Other (Gains on Sales, etc.)

45

48

+3

681

723

+42

Repair & Maintenance

38

44

+6

Depreciation

364

378

+14

Operating Profit

566

603

+37

Recurring Profit

362

352

-10

Net Income

361

351

-10

JPY 1,418

JPY 1,380-JPY 38

1,052

1,110

+58

Post-Depreciation NOI

687

732

+45

Capex

199

670

+471

Operating Expenses

Dividend
NOI

Property tax +9, Management outsourcing fee +6
AM fee +2, SG&A expenses +4

Borrowing-related expenses/Interest expenses +45
Fall-off of non-operating income -1-2.7% YOY

Guest room renovations (Kurashiki),
Equipment upgrades (Sapporo Ekimae, Kumamoto, Matsuyama)© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

24

Ichigo’s Commitment to ESG© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

25

Ichigo Sustainability Policy
Harmony with the Environment
Ichigo actively monitors and minimizes the environmental impact of its business operations.

Energy Conservation, CO2 Reduction, and Recycling
Ichigo seeks to contribute to a low-carbon, low-waste society by reducing energy
consumption, extending the useful life of assets, actively recycling, reducing waste
production and water consumption, and implementing green procurement measures.

Regulatory and Environmental Compliance
Ichigo complies with all environmental laws and regulations and Ichigo’s own independentlyestablished environmental rules. Ichigo also carefully monitors and complies with all applicablechanges in laws and regulations.

Training and AwarenessIchigo promotes understanding of its Sustainability Policy and works to increase sustainability
awareness among all Ichigo employees.

Sustainability Performance Communication and Disclosure
Ichigo communicates its Sustainability Policy and Ichigo’s sustainability initiatives to society atlarge. Ichigo also obtains certifications for its sustainability activities on an ongoing basis.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

26

Climate Positive: CO2 Reduction > Emissions
Ichigo’s Clean Energy Growth Addressing Critical Environmental Issues
CO2 Reduction vs. CO2 Emissions(tons)■ Total Ichigo Power Plant CO2 Reduction■ Total Ichigo CO2 Emissions (Scope1+2)

2.5X
CO2 Reduction
vs.
CO2 Emissions
137,848
Further Reduction of
CO2 Emissions:

115,884
97,215

Increasing Renewables

75,89059,235

Pre-Covid
FY20/2

FY21/254,802

Increasing Energy Efficiency
LED lighting, HVAC upgrades(c. 1.5% p.a. reduction)

Joined RE100
FY22/2© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

27

RE100 by 2025 On Track
Ichigo RE100 Progress

FY23/2 Forecast RE100 Transition Impact

CO2 Reduction
Renewable Energy
Ratio

60.4%

% Reduction

35,815 tons
47.2%

CO2 Emissionsof Cars

× 15,572(+7.2pts vs. FY22/2 Q4)

Note:% Reduction = Amount of CO2 reduction vs. 75,890 tons (FY20/2 actual)
Annual CO2 emission per car c. 2,300kg (Ministry of Environment)

As of FY23/2 Q1 (May 31, 2022)
Includes all Ichigo, Ichigo Hotel (3463), andIchigo Office (8975) assets© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

28

Ichigo ESG – Environmental
Sustainability-Driven & Climate Positive
Effective Use of Existing Real Estate

Towards a Net Zero Carbon Society

J-REIT Initiatives

Preserve & Improve Real Estate
to End Wasteful Demolition

Community-Based, Productive Use of
Idle Land for Clean Energy

Pro-Active Environmental
Certifications

Ichigo's Sustainable Real Estate businesshas a proven track record of preserving andimproving existing real estate. Ichigo willbuild on this long-standing commitment tosustainability by developing newtechnologies to extend the lives of buildings
and other social infrastructure 100 years
and beyond.

Ichigo will not build power plants that
require the clearing of wooded land or thealtering of the landscape in a way that
increases the risk of floods, landslides, orother water-related disasters, or that face
opposition from local communities.

By obtaining certifications such as GRESB,CASBEE, BELS, and DBJ Green Building,
Ichigo is demonstrating our long-standing
commitment to sustainability via initiatives
that benefit investors, tenants, clients, andother stakeholders.

Ichigo’s Sustainable Real Estate
Preserve & Create Value
Sustainable
Real Estate

Increase
Quality ofTenantServices+

Annual Power Production

217,758,958 kWh
Equivalent to annual
energy consumption of
72,586 households
Annual CO2 Reduction

Increase= Tenant
Satisfaction

Renovate &RepairImprove aesthetics and comfort
Seismic reinforcements
Regulatory compliance
Increase energy efficiency

124,281,000 kg
Equivalent to annual
CO2 emission of
54,035 cars
* July 2021 – June 2022 Actuals

Ichigo Hotel(3463)

Ichigo Office(8975)

Certifications• HOTEL EMITSHIBUYA(BELS, 4 stars)
GRESB (Since 2021)• Received Green Star.
Evaluated for ESG,
management, &performance
Transition to Renewable
Energy• Completed at 9 hotels• To be transitioned
sequentially at otherhotelsCertifications• 20 (19 assets)• 33.3% of total leasable
office area
GRESB (Since 2016)• Received Green Star
for 5 years in a row.
Evaluated for ESG,
management, &performance
Transition to Renewable
Energy• Completed at all 74
assets by April 2022
(excludes partially-owned
assets)(as of August 31, 2022)© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

29

Ichigo ESG – Social
Contributing to a Sustainable Society
Contributing to Regional Revitalization

Ichigo University

Ichigo works to revitalize local communities
and promote regional economic
development. Ichigo’s model of preserving
and improving existing real estate creates
jobs and supports businesses, and ourclean energy plants also support their hostcommunities by providing new andsustainable sources of income.

Ichigo established Ichigo University in May
2013 to support employees’ continuing
education and personal growth.
Ichigo University courses are taught byemployees and external professionals whoare specialists in their fields and have deep
experience.

Sports Initiatives

As a top partner of the J.League
professional soccer league, we support theleague’s mission to promote community
development. Ichigo supports outstanding
athletes in weightlifting, rifle shooting, andtrack and field.

Average Annual Number of Courses: 30
THE KNOT TOKYO
Shinjuku

Ichigo University Classes

Hotel / Tokyo
https://hotel-theknot.jp/tokyoshinjuku/en

Miyako City
Retail Asset / Miyazaki
www.miyakocity.com

Chisato Kiyoyama(Track and Field)
OnlineIn-Person

Hiromi Miyake(Weightlifting)
Ichigo Sports Site (Japanese only)
www.ichigo.gr.jp/ichigosports© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

30

Ichigo ESG – Governance
Global Best Practice Governance
No Fixed Fee,
Performance FeeOnly Structure

Best Practice GovernanceREIT Shifted to performancelinked fee structure to
support shareholder
value creation on
February 1, 2019
 Pro-active, dynamic
management of Ichigo
Hotel assets on behalfof shareholders

Asset Management Company (AMC) Monitors Asset Management Company• All Ichigo Hotel Directors are Independent
Directors• Active dialogue and effective internal controls
via Board discussions led by REIT Executive
Director• Draw upon expertise of REIT Supervisory
Directors (qualified lawyers & accountants)

 Best Practice• Majority of AMC Directors (3 of 5) are
Independent Directors• Independent asset management team & bestpractice execution on behalf of Ichigo Hotel
REIT within AMC• Compliance and Audit are directly under the
AMC President to monitor and review criticalcompliance matters• Ensure objectivity by including third-party,
independent lawyers and accountants in theInvestment and Risk & Compliance Committees

Only 3 J-REITS (out of 61), including Ichigo Hotel (3463) and Ichigo Office (8975),
have both an Asset Management Company (AMC) board that has a majority of Independent
Directors and whose AMC President does NOT serve as the Executive Director of the REIT
Independence of the Investment Corporation From AMC

Independent Directors at AMC➡ 27 of 61 J-REITs have AMC Presidents serving as➡ Only 3 Asset Management Companies have any

Executive Director of the REIT

Independent Directors

All Ichigo Hotel Directors are Independent

3 of 5 Ichigo Investment Advisors' Directors
are Independent* Based on research as of August 31, 2022

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

31

Appendix: Portfolio Details© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

32

Hotel Map
Tokyo

Kanto/Koshinetsu
C-4

C-1

C-3

Smile HotelTokyo Asagaya

Hotel Livemax
NihombashiHakozaki

HOTEL
EMIT
SHIBUYA

Kinki (Kyoto/Osaka/Kobe)
E-1

Hokkaido

Hokuriku/Tokai

B-1

B-2

A-1

A-2

Capsule Plus
Yokohama

Comfort Hotel
NaganoNest Hotel
Nest Hotel
Sapporo Ekimae Sapporo Odori

F-1

D-1

ComfortHotel Kushiro

D-2

Comfort Hotel
Hamamatsu

D-3

Hotel Wing
International
NagoyaD-4

Comfort Hotel
Central International
Airport

Comfort Hotel
SuzukaKyushuChugoku/Shikoku

E-3

A-3

F-2

F-3

G-1

▶ Sapporo
A-1 A-2

G-3

Variable Rent

▶ Kushiro
A-3

Fixed Rent
Smile Hotel
Kyoto Shijo

The OneFive
Osaka Sakaisuji

The OneFive
Okayama

E-4

E-5

F-4

Nest Hotel
Matsuyama

F-5

Urbain Hiroshima
Executive

The OneFive
Fukuoka Tenjin

Nest Hotel
Kumamoto▶ Nagano B-2

F-6▶ Nagoya D-2▶ Kyoto E-1

Hotel Wing International
Kobe Shin Nagata Ekimae

Nest Hotel Osaka
Shinsaibashi

B-3
January 2023
Hotel Acquisition(Scheduled)

The OneFive
GardenKurashiki

Valie Hotel
Hiroshima

Washington Hotel
Plaza Shimonoseki
Eki Nishi▶ Osaka E-3 E-5▶ Kurashiki F-4

24 Hotels
JPY 52.5B▶ TokyoC-1 C-3 C-4▶ Yokohama B-1▶ Shimonoseki F-6▶ Hamamatsu D-1▶ Fukuoka▶ Matsuyama▶ Aichi D-3
G-1
F-2▶ Suzuka D-4▶ Kumamoto▶ Kobe E-4
G-3▶ Okayama F-1

Hotel Sunshine
Utsunomiya© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

▶ Hiroshima F-3 F-5(July 2022 rent-basis)33

Portfolio Growth
IPO(Nov 30, 2015)
IPO Acquisitions
9 Hotels
JPY 20.4B
Acquisitions(Appraisal NOI Yield
5.9%)

January 2017 through July 2022
Fiscal Periods
Jan 2017 Jul 2017
10 Hotels
1 HotelJPY 27.2B JPY 1.4 B(5.5%)(5.0%)

None

Sales

None

Portfolio
Size

9 Hotels : JPY 20.4B(January 2016 end)

Jan 2018
1 HotelJPY 1.8 B(6.3%)Jan 2019
1 HotelJPY 1.7B(6.9%)

July 20192 Hotels
JPY 3.7B(6.9%)

1 HotelJPY 2.7B
Gains on Sale
JPY 0.69B

None

Jan 2020
None

2 Hotels
JPY 9.7B
Gains on Sale
JPY 1.94B

19 Hotels 20 Hotels 21 Hotels 21 Hotels 23 Hotels 21 Hotels
JPY 47.6B JPY 49.1B JPY 50.9B JPY 50.7B JPY 54.4B JPY 47.1B

IPO

Location

Geographic Diversification
Increases Earnings Stability

Kyoto
39.6%

Hokkaido
17.7%
Tokai
7.6%

Jan 2021Jan 2022
None

Jul 2022
1 Hotel
JPY 0.6B(6.5%)

None
23 Hotels
JPY 51.9B

24 Hotels
JPY 52.5B
July 31, 2022

Kobe Osaka
7.3% 8.0%
Nagoya
13.1%
Kyushu6.8%

July 2020
2 Hotels
JPY 4.7B(4.9%)

Kanto/Koshinetsu
4.1%
Nagoya5.1%
Kyushu
6.8%

Kobe
2.8%
Osaka
17.6%
Kyoto
8.5%

Hokkaido
7.4%

Steady Portfolio Growthvia Acquisitions© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Tokyo
17.1%
Tokai
13.6%

Chugoku/
Shikoku
17.0%

34

Portfolio Lease Details
Operator Diversification Driving Earnings Stability
Lease Terms

Fixed Rent

Fixed + Variable Rent

(as of July 31, 2022)

Variable Rent

Total

Form of Contract

Lease

Lease

Lease

Lease

–

Fixed Rent

Yes

Yes

Yes

–

–

Variable Rent–

Fixed Portion of
Revenue Upside

Fixed Portion of Hotel
GOP

Excess Above FixedPortion of Hotel GOP–

Rental Income(July 2022 Actual)

JPY 392M(32.6%)

JPY 101M(8.4%)

JPY 690M(57.4%)

Not Available1

JPY 1,203M(100%)

Number of Hotels

8 Hotels

2 Hotels

13 Hotels

1 Hotel24 Hotels

Total AcquisitionPrice

JPY 12.37B(23.5%)

JPY 4.16B(7.9%)

JPY 34.57B(65.7%)

JPY 1.49B(2.8%)

JPY 52.58B(100%)

Hotels• Comfort Hotel Kushiro• Hotel Wing International• Comfort Hotel Hamamatsu
Nagoya• Comfort Hotel Central• Hotel Wing International
International Airport
Kobe Shin Nagata Ekimae• Comfort Hotel Suzuka• Hotel Livemax NihombashiHakozaki• Urbain Hiroshima Executive• Washington Hotel Plaza
Shimonoseki Eki Nishi• Comfort Hotel Nagano2• Nest Hotel Sapporo Ekimae• Nest Hotel Sapporo Odori• Nest Hotel Osaka
Shinsaibashi• Nest Hotel Matsuyama• Nest Hotel Kumamoto• Smile Hotel Tokyo Asagaya• Smile Hotel Kyoto Shijo• Valie Hotel Hiroshima• The OneFive Fukuoka
Tenjin• The OneFive Garden
Kurashiki• HOTEL EMIT SHIBUYA• The OneFive Okayama• The OneFive Osaka
Sakaisuji• Capsule Plus Yokohama–

1 Operator did not provide consent to disclose information
2 Comfort Hotel Nagano was acquired on May 31, 2022

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

35

Individual Hotel Summary(as of July 31, 2022)
Lease Terms

Location

Nest Hotel Sapporo Ekimae

Variable + Fixed Rent

Sapporo5,734.93

2,160

2,133

2,590

5.1

+456

A-2

Nest Hotel Sapporo Odori

Variable + Fixed Rent

Sapporo5,638.78

1,450

1,445

1,820

5.0

+374

A-3

Comfort Hotel Kushiro

Fixed Rent

Kushiro, Hokkaido

3,180.58

300

284

365

5.5

+80

B-1

Capsule Plus Yokohama

Variable Rent

Yokohama

1,183.26

1,490

1,556

1,270

4.8

-286

B-2

Comfort Hotel Nagano

Fixed Rent

Nagano1,921.45

670

692

701

4.9

+8

C-1 Smile Hotel Tokyo Asagaya

Variable + Fixed Rent

Tokyo

2,721.70

3,910

3,870

4,360

4.3

+489

Fixed Rent

Tokyo

853.00

1,360

1,269

1,380

4.6

+110

Variable + Fixed Rent

Tokyo

1,470.52

3,700

3,795

3,960

3.6

+164

A-1

Hotel Name

C-3 Hotel Livemax Nihombashi-Hakozaki
C-4 HOTEL EMIT SHIBUYA
D-1 Comfort Hotel Hamamatsu

Acquisition
Price(JPY M)

Book Value(JPY M)(A)

Fixed Rent

Hamamatsu, Shizuoka

4,173.92

1,550

1,395

1,750

5.2

+354

Variable + Fixed Rent

Nagoya5,255.66

2,670

2,691

2,150

4.7

-541

D-3 Comfort Hotel Central International Airport

Fixed Rent

Tokoname, Aichi

11,599.63

5,308

5,204

5,790

4.1

+585

D-4 Comfort Hotel Suzuka

Fixed Rent

Suzuka, Mie

2,186.65

300

263

359

5.0

+95

D-2 Hotel Wing International Nagoya

Hotel

Jul 2022 Appraisal
Unrealized
Value
Cap Rate Gains (JPY M)(JPY M)(B) - (A)(%)(B)

Leasable
Area
(m2)

Hotel
No.

E-1

Smile Hotel Kyoto Shijo

Variable + Fixed Rent

Kyoto

4,891.84

4,480

4,502

3,570

4.5

-932

E-3

The OneFive Osaka Sakaisuji

Variable + Fixed Rent

Osaka

3,568.32

1,630

1,754

1,220

4.8

-534

E-4

Hotel Wing International Kobe Shin Nagata Ekimae

Variable + Fixed Rent

Kobe

4,540.90

1,490

1,375

1,810

4.7

+434

E-5

Nest Hotel Osaka Shinsaibashi

Variable + Fixed Rent

Osaka

8,057.26

7,600

7,539

5,480

4.4

-2,059F-1

The OneFive Okayama

Variable + Fixed Rent

Okayama

5,543.70

1,200

1,195

1,760

5.7

+564

F-2

Nest Hotel Matsuyama

Variable + Fixed Rent

Matsuyama, Ehime

6,671.94

1,610

1,624

1,970

5.6

+345

F-3

Urbain Hiroshima Executive

Fixed Rent

Hiroshima

2,756.20

1,800

1,780

2,030

5.3

+249

F-4

The OneFive Garden Kurashiki

Variable + Fixed Rent

Kurashiki, Okayama

3,964.19

1,725

1,811

2,240

5.2

+428

F-5

Valie Hotel Hiroshima

Variable + Fixed Rent

Hiroshima

4,332.50

1,500

1,538

1,670

5.0

+131

F-6

Washington Hotel Plaza Shimonoseki Eki Nishi

Fixed Rent

Shimonoseki, Yamaguchi

5,709.35

1,080

1,066

1,180

4.9

+113

G-1 The OneFive Fukuoka Tenjin

Variable + Fixed Rent

Fukuoka

1,910.94

1,380

1,446

2,230

4.3

+783

G-3 Nest Hotel Kumamoto

Variable + Fixed Rent

Kumamoto

6,404.36

2,220

2,207

2,330

5.4

+122

Total (24 Hotels)

104,271.58

52,58352,44553,985

4.7+1,539© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

36

July 2022 Fiscal Period Individual Hotel Operating Results(year-on-year)
Hotel
No.

Hotel Name

Lease Terms

Location

No. of
Guest
Rooms

July 2022 (February 2022 - July 2022)
RevPAR (JPY)

Occupancy (%)

ADR (JPY)

Revenue (JPY M)

A-1

Nest Hotel Sapporo Ekimae

Variable + Fixed Rent

Sapporo

162

5,156

(+55.3%)

94.2%(+7.7%)

5,473(+44.2%)183.3(+46.9%)A-2

Nest Hotel Sapporo Odori

Variable + Fixed Rent

Sapporo

121

5,355

(+114.6%)

95.2%(+45.7%)5,625(+47.3%)139.3(+108.5%)

A-3

Comfort Hotel Kushiro

Fixed Rent

Kushiro, Hokkaido

126

4,536

(+41.5%)76.8%(+22.8%)5,909(+15.2%)109.8(+42.1%)

B-2

Comfort Hotel Nagano

Fixed Rent

Nagano

76

6,467

–

94.3%

–

6,860

–

30.2

–

C-1

Smile Hotel Tokyo Asagaya

Variable + Fixed Rent

Tokyo

112

6,496

(+36.4%)96.9%(+0.5%)

6,703(+35.7%)133.5(+34.5%)

C-4

HOTEL EMIT SHIBUYA

Variable + Fixed Rent

Tokyo

72

6,289

(+51.3%)99.0%(+4.9%)

6,353(+44.2%)82.0(+51.0%)

D-1

Comfort Hotel Hamamatsu

Fixed Rent

Hamamatsu, Shizuoka

196

3,675

(+48.6%)68.3%(+34.8%)5,379(+10.3%)130.4(+48.6%)

D-2

Hotel Wing International Nagoya

Variable + Fixed Rent

Nagoya224

5,455(+255.4%)

100% (+149.9%)

5,455(+42.2%)221.2(+217.0%)

D-3

Comfort Hotel Central International Airport

Fixed Rent

Tokoname, Aichi

346

4,190

(+55.3%)56.1%(+45.1%)

7,465(+7.0%)

270.3(+55.9%)

D-4

Comfort Hotel Suzuka

Fixed Rent

Suzuka, Mie

105

4,174

(+61.8%)73.8%(+42.6%)

5,655(+13.5%)80.0(+61.0%)

E-1

Smile Hotel Kyoto Shijo

Variable + Fixed Rent

Kyoto

144

2,262

(+161.0%)

60.0% (+113.3%)

3,769(+22.4%)64.5(+168.3%)

E-3

The OneFive Osaka Sakaisuji

Variable + Fixed Rent

Osaka

130

2,651

–

96.2%

–

2,755

–

62.9

–

E-4

Hotel Wing International Kobe Shin Nagata Ekimae

Variable + Fixed Rent

Kobe

133

4,696

(+64.2%)

63.4%(+53.1%)

7,413(+7.2%)

121.4(+56.7%)

E-5

Nest Hotel Osaka Shinsaibashi

Variable + Fixed Rent

Osaka

302

2,235

(+575.7%)

61.6% (+526.3%)

3,627(+7.9%)

134.4(+960.0%)

F-1

The OneFive Okayama

Variable + Fixed Rent

Okayama

208

3,536

(+49.6%)97.8%(+9.1%)

3,618(+37.1%)138.7(+50.0%)

F-2

Nest Hotel Matsuyama

Variable + Fixed Rent

Matsuyama, Ehime

190

3,747

(+62.3%)76.8%(+41.4%)4,881(+14.8%)162.3(+64.6%)

F-3

Urbain Hiroshima Executive

Fixed Rent

Hiroshima

171

2,144

(+32.7%)39.7%(+71.4%)5,400(-22.6%)

66.4(+32.7%)

F-4

The OneFive Garden Kurashiki

Variable + Fixed Rent

Kurashiki, Okayama

107

3,192

(+61.8%)44.3%(+29.5%)

7,209(+24.9%)68.4(+43.4%)

F-5

Valie Hotel Hiroshima

Variable + Fixed Rent

Hiroshima

171

7,500

(+3.3%)

100%(+3.6%)

7,500(-0.2%)

233.5(-0.3%)G-1

The OneFive Fukuoka Tenjin

Variable + Fixed Rent

Fukuoka

77

3,932(+61.4%)93.6%(+3.5%)

4,200(+55.9%)60.6(+52.6%)

G-3

Nest Hotel Kumamoto

Variable + Fixed Rent

Kumamoto

201

5,000

(+107.5%)

100%(+55.0%)5,000(+33.9%)182.6(+85.1%)

Other

455

Variable Rent Hotels

2,523

4,348

(+51.8%)84.7%(+29.6%)

5,132(+17.1%)

1,988.8(+74.4%)

Fixed Rent Hotels

1,306

3,721

(+49.1%)

61.3%(+37.7%)6,066(+8.3%)

683.4(+49.3%)

Total

3,829

4,162

(+51.9%)77.8%(+33.3%)5,351(+13.9%)2,672.1(+67.2%)* Year-on-year comparisons for Comfort Hotel Nagano are excluded because the hotel was acquired during July 2022 Fiscal Period on May 31, 2022.
* Operating Results data for Hotel Livemax Nihombashi-Hakozaki, Capsule Plus Yokohama, and Washington Hotel Plaza Shimonoseki Eki Nishi are consolidated under Other,because the hotel operators did not provide consent to disclose hotel-specific data. Fixed Rent Hotels and Total include Hotel Livemax Nihombashi-Hakozaki’s operating
results.
© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

37

Individual Hotel Financials(JPY thousand)

Total

A-1

A-2

A-3

Nest
Hotel
SapporoEkimaeNest
Hotel
Sapporo
Odori

C-1

C-4

D-1

D-3

D-4

Comfort
Comfort
Comfort Smile Hotel HOTEL
ComfortHotel Central
Hotel
Hotel
Tokyo
EMIT
Hotel
International
SuzukaKushiro Asagaya SHIBUYA Hamamatsu
Airport

E-1

E-3

E-5

F-1

Smile
Hotel
Kyoto
Shijo

The
OneFive
Osaka
Sakaisuji

Nest Hotel
Osaka
Shinsaibashi

F-2

F-4

The
Nest Hotel
OneFive
Matsuyama
Okayama

F-5

G-1

G-3

The
The
OneFive Valie Hotel OneFive
Garden Hiroshima Fukuoka
Kurashiki
TenjinNest Hotel
Kumamoto

Other(A) Rental Income

1,248,372

52,65432,684

18,41967,61547,56855,361

151,441

15,44230,744

1,848

66,291

62,16147,534

2,249

151,382

34,056

94,427

316,487

Fixed Rent

900,497

31,12927,072

18,41961,60347,56855,361

151,441

15,44230,744

1,454

66,291

62,161

36,323994

17,934

34,05625,134

217,364

Variable Rent

302,719

21,525

5,612

–

6,011

–

–

–

–

–

394

–

–

11,2101,255

132,848–

69,29354,567

Other Rent

45,155

–

–

–

–

–

–

–

–

–

–

–

–

–

–

600

–

–

44,555(B) Rental Expenses

195,795

8,824

10,846

5,730

9,572

8,828

3,813

15,008

4,081

6,386

6,499

18,885

7,041

6,855

16,639

9,139

5,433

6,839

45,370Outsourcing
Fees

17,721

600

600

900

2,393

700

600

570

540

600

1,015

1,200

600

720

600

720

700

780

3,882

Insurance

3,726

198

201

105

117

72

128

374

64

170

125

316

187

262

129

172

69

236

792

RepairExpenses

38,651

2,560

1,403

290

2,995

2,793

430

1,053

1,336

231

1,294

2,331

1,923

1,065

10,865

3,721

511

608

3,236

Taxes

117,781

5,047

8,215

4,023

3,656

4,803

2,384

12,552

1,730

5,025

3,397

14,627

3,891

4,378

4,110

4,157

3,485

4,804

27,489

Other
Expenses

17,914

418

426

411

409

460

270

458

410

359

666

410

437

427

933

367

667

410

9,969

NOI
(A) - (B)

1,052,577

43,83021,837

12,68958,042

38,73951,548

136,433

11,361

24,358-4,65047,40555,12040,679-14,389

142,242

28,62287,588271,116(D) Depreciation

364,915

15,72818,0785,820

26,361

7,784

15,05834,998

4,166

17,156

9,552

35,953

16,87919,036

12,56021,368

8,554

22,14873,707

Net Rental
Income(C) - (D)687,662

28,102

3,759

6,868

31,68030,95436,490101,434

7,195

7,202

-14,203

11,452

38,241

21,642-26,950

120,874

20,06865,439197,409(C)* Rents for Hotel Wing International Nagoya, Hotel Wing International Kobe Shin Nagata Ekimae, Hotel Livemax Nihombashi-Hakozaki, Capsule Plus Yokohama, Urbain Hiroshima
Executive, Washington Hotel Plaza Shimonoseki Eki Nishi, and Comfort Hotel Nagano as well as retail income of The OneFive Osaka Sakaisuji, Smile Hotel Tokyo Asagaya, and Nest Hotel
Kumamoto are included in Other, as the operators did not provide consent to disclose the data.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

38

Fixed/Variable Rent, RevPAR, ADR, & Occupancy Trends
Fixed/Variable Rent

(JPY thousand)Jul 2021
Rent

Ratio

Jul 2022
Rent

Ratio

Ratio

976,19687.3%

962,540

85.5%

929,692

74.5%

Fixed Rent from Operators

947,03184.7%

933,355

82.9%

900,497

72.1%

Other (Rent from Retail Tenants)

29,164

2.6%

29,184

2.6%

29,194

2.3%

Variable Rent

126,577

11.3%

147,81213.1%

302,719

24.2%

Other (Utility Income)

15,184

1.4%

15,466

1.4%

15,960

1.3%

Total

1,117,958

100%

1,125,819

100%

1,248,372

100%

Rent

Fixed

Jan 2022
Rent

Operating Results (Aug 2021 – Jul 2022)

RevPAR (right axis)

ADR (right axis)

Occupancy (left axis)

(JPY)

80%

8,000

60%

6,000

40%

4,000

20%

2,000

0%

0
Aug 2021

Sep 2021

Oct 2021

Nov 2021

Dec 2021

Jan 2022

Feb 2022© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Mar 2022

Apr 2022

May 2022

Jun 2022

Jul 2022

39

Variable Rent Hotel Details
A-1 Nest Hotel Sapporo Ekimae
Location

SapporoAccess5-minute walk from
Sapporo Station on
Sapporo City Metro
Namboku LineOperator

Nest Hotel Japan
Corporation

ADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

100%

10,000

80%

8,000

60%

6,000

40%

4,000
2,000

Guest Rooms

162

20%

AcquisitionPrice

JPY 2.16B

0%0
Aug 2021

Nov 2021

Feb 2022

May 2022

A-2 Nest Hotel Sapporo Odori
Location

SapporoAccess4-minute walk from
Odori Station on
Sapporo City Metro
Namboku LineOperator

Nest Hotel Japan
Corporation

Guest Rooms
Acquisition
Price

ADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left) (JPY)100%

10,000

80%

8,000

60%

6,000

40%

4,000

121

20%

2,000

JPY 1.45B

0%0
Aug 2021© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Nov 2021

Feb 2022

May 202240

Variable Rent Hotel Details
B-1 Capsule Plus Yokohama
Location

Yokohama, Kanagawa

Access6-minute walk from
Yokohama Station on
JR/ Subway LineOperator

The hotel operator did not give consent to disclose data.

nine hours Inc.

Guest Rooms

169

AcquisitionPrice

JPY 1.49B

C-1 Smile Hotel Tokyo Asagaya
Location

Suginami-ku, Tokyo

Access1-minute walk from
Asagaya Station on JR
Chuo/Sobu LineOperator

K.K. Hospitality
Operations

Guest Rooms

112

AcquisitionPrice

JPY 3.91B

ADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

100%

10,000

80%

8,000

60%

6,000

40%

4,000

20%

2,000

0%

0
Aug 2021© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Nov 2021

Feb 2022

May 2022

41

Variable Rent Hotel Details
C-4 HOTEL EMIT SHIBUYA
Location

Shibuya-ku, Tokyo

Access6-minute walk from
Shibuya Station on JR,
Tokyu, Keio, andTokyo Metro Lines

Operator

Hakata Hotels Inc.

Guest Rooms

72

AcquisitionPrice

JPY 3.7B

ADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

100%

10,000

80%

8,000

60%

6,000

40%

4,000

20%

2,000

0%

0
Aug 2021

Nov 2021

Feb 2022

May 2022

D-2 Hotel Wing International Nagoya
Location

NagoyaAccess2-minute walk from
Marunouchi Station on
both Nagoya Subway
Network SakuradoriLine and Tsurumai
Line

Operator

Minacia Co., Ltd.

Guest Rooms

224

AcquisitionPrice

JPY 2.67B

ADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

100%

10,000

80%

8,000

60%

6,000

40%

4,000

20%

2,000
0

0%
Aug 2021

Nov 2021

Feb 2022

May 2022* Aichi Prefecture has temporarily leased all rooms of Hotel Wing International Nagoya starting on January 28, 2022.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

42

Variable Rent Hotel Details
E-1 Smile Hotel Kyoto Shijo
Location

Kyoto

Access5-minute walk from
Shijo Station on Kyoto
City Subway Karasuma
Line and Karasuma
Station on Hankyu
Kyoto Main LineADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)
(JPY)

100%

7,500

80%

6,000

60%

4,500

K.K. Hospitality
Operations

40%

3,000

Guest Rooms

144

20%

1,500

AcquisitionPrice

JPY 4.48B

0%

Operator0
Aug 2021

Nov 2021

Feb 2022

May 2022

E-3 The OneFive Osaka Sakaisuji
Location

Osaka

Access5-minute walk from
Sakaisuji-Hommachi
Station on Osaka
Municipal Subway
Chuo LineADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)
(JPY)

100%

7,500

80%

6,000

60%

4,500

Hakata Hotels Inc.

40%

3,000

Guest Rooms

130

20%

1,500

AcquisitionPrice

JPY 1.63B

0%Operator0
Aug 2021

Nov 2021

Feb 2022

May 2022* Closed in December 2020. Changed operator and rebranded and reopened as The OneFive Osaka Sakaisuji in September 2021.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

43

Variable Rent Hotel Details
E-4 Hotel Wing International Kobe Shin Nagata Ekimae
Location

Kobe

100%

Access2-minute walk from
Shin Nagata Station
on JR Kobe Line and
JR Sanyo Honsen LineADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

10,000

80%

8,000

60%

6,000

Minacia Co., Ltd.

40%

4,000

Guest Rooms

133

20%

2,000

AcquisitionPrice

JPY 1.49B

0%Operator0
Aug 2021

Nov 2021

Feb 2022

May 2022

E-5 Nest Hotel Osaka Shinsaibashi
Location

Osaka

Access1-minute walk from
Nagahoribashi Station
on Osaka Municipal
Subway Sakaisuji LineADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)
(JPY)

100%

7,500

80%

6,000

60%

4,500

Nest Hotel Japan
Corporation

40%

3,000

Guest Rooms

302

20%

1,500

AcquisitionPrice

JPY 7.60B

0%Operator0
Aug 2021© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Nov 2021

Feb 2022

May 2022

44

Variable Rent Hotel Details
F-1 The OneFive Okayama
ADR(right)

RevPAR(right)Occupancy(left)(JPY)

Location

Okayama

100%

7,500

Access15-minute walk from
Okayama Station on
Sanyo Shinkansen,
Sanyo Main Line, Uno
Line

80%

6,000

60%

4,500

Hakata Hotels Inc.

40%

3,000

Guest Rooms

208

20%

1,500

AcquisitionPrice

JPY 1.20B

0%Operator

Operating Results (Aug 2021 – Jul 2022)

0
Aug 2021

Nov 2021

Feb 2022

May 2022

F-2 Nest Hotel Matsuyama
Location

Matsuyama, Ehime

Access25-minute drive from
Matsuyama Airport,
3-minute walk from
Katsuyamacho Station
on Iyo Railway Jonan
Line

ADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)100%

Occupancy(left)
(JPY)

7,500

80%

6,000

60%

4,500

Nest Hotel Japan
Corporation

40%

3,000

Guest Rooms

190

20%

1,500

AcquisitionPrice

JPY 1.61B

0%Operator0
Aug 2021© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Nov 2021

Feb 2022

May 2022

45

Variable Rent Hotel Details
F-4 The OneFive Garden Kurashiki
Location

Kurashiki, Okayama

Access8-minute walk from
Kurashiki Station on
JR Sanyo Main LineADR
(right)100%

Occupancy(left)(JPY)
10,000

80%

8,000

60%

6,000

Hakata Hotels Inc.

40%

4,000

Guest Rooms

107

20%

2,000

AcquisitionPrice

JPY 1.73B

0%Operator

Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)0
Aug 2021

Nov 2021

Feb 2022

May 2022* Closed in December 2021. Changed operator and rebranded and reopened as The OneFive Garden Kurashiki in February 2022.

F-5 Valie Hotel Hiroshima
Location

Hiroshima

Access3-minute walk from
Jogakuin-mae Station
on Hiroden Tram LineADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)(JPY)

100%

10,000

80%

8,000

60%

6,000

The Court Co., Ltd.

40%

4,000

Guest Rooms

171

20%

2,000

AcquisitionPrice

JPY 1.50B

0%Operator0
Aug 2021

Nov 2021

Feb 2022

May 2022* Hiroshima Prefecture has temporarily leased all rooms of the Valie Hotel Hiroshima starting on February 8, 2021.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

46

Variable Rent Hotel Details
G-1 The OneFive Fukuoka Tenjin
Location

Fukuoka

Access6-minute walk from
Tenjin Station on
Fukuoka City Subway
Kuko LineADR(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)
(JPY)

100%

7,500

80%

6,000

60%

4,500

Hakata Hotels Inc.

40%

3,000

Guest Rooms

77

20%

1,500

AcquisitionPrice

JPY 1.38B

0%Operator0
Aug 2021

Nov 2021

Feb 2022

May 2022

G-3 Nest Hotel Kumamoto
Location

Kumamoto

Access2-minute walk from
Nishikarashimacho
Station on Kumamoto
City Tram LineADR
(right)Operating Results (Aug 2021 – Jul 2022)

RevPAR(right)Occupancy(left)
(JPY)

100%

7,500

80%

6,000

60%

4,500

Nest Hotel Japan
Corporation

40%

3,000

Guest Rooms

201

20%

1,500

AcquisitionPrice

JPY 2.22B

0%Operator0
Aug 2021© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Nov 2021

Feb 2022

May 202247

Fixed Rent Hotel Details
A-3 Comfort Hotel Kushiro

B-2 Comfort Hotel Nagano

Location

Kushiro, Hokkaido

Location

NaganoAccess2-minute walk from
Kushiro Station on JR
Nemuro Main Line

Access3-minute walk from
Nagano Station on JR
Hokuriku Shinkansen

Operator

Greens Co., Ltd.

Operator

Greens Co., Ltd.

Guest Rooms

126

Guest Rooms

76

AcquisitionPrice

JPY 300M

AcquisitionPrice

JPY 670M

C-3 Hotel Livemax Nihombashi-Hakozaki
Location

Chuo-ku, Tokyo

D-1 Comfort Hotel Hamamatsu
Location

Hamamatsu, Shizuoka

Access3-minute walk from
Suitengumae Station
on Tokyo Metro
Hanzomon Line

Access2-minute walk from
Hamamatsu Station on JR
Tokaido Main Line, Tokaido
Shinkansen

Operator

Live Max Inc.

Operator

Greens Co., Ltd.

Guest Rooms

48

Guest
Rooms

196

AcquisitionPrice

JPY 1.36B

AcquisitionPrice© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

JPY 1.55B

48

Fixed Rent Hotel Details
D-3 Comfort Hotel Central International Airport
Location

Tokoname, Aichi

Access5-minute walk fromCentral International
Airport,3-minute walk fromCentral International
Airport Station on
Meitetsu Airport Line

D-4 Comfort Hotel Suzuka
LocationSuzuka, Mie

Access3-minute walk from
Shirako Station on
Kintetsu Nagoya LineOperator

Greens Co., Ltd.

Greens Co., Ltd.

Guest Rooms

105

Guest Rooms

346

AcquisitionPrice

JPY 300M

AcquisitionPrice

JPY 5.31B

Operator

F-3 Urbain Hiroshima Executive
Location

Hiroshima

Access6-minute walk from
Hiroshima Station on JR
Sanyo Shinkansen andSanyo Main LineOperator

Yuki Corporation

Guest Rooms

171

AcquisitionPrice

JPY 1.80B

F-6 Washington Hotel Plaza Shimonoseki Eki Nishi
Location

Shimonoseki,
Yamaguchi

Access3-minute walk from
Shimonoseki Station
on JR Sanyo MainLine

Operator

Washington HotelCorp.

Guest Rooms

238

AcquisitionPrice

JPY 1.08B© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

49

Appendix: Loan Details & Shareholder Composition© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

50

Stable Financial Base
Outstanding Loan Balance
Jul 31, 2020
AmountJan 31, 2021

Jul 31, 2021

Jan 31, 2022

Jul 31, 2022

JPY 25.47B

JPY 25.47B

JPY 25.47B

JPY 25.47B

JPY 25.47B

Long-Term Loan Ratio

93.1%

72.5%

72.5%

72.5%

70.7%

Fixed Rate Ratio

91.4%

70.7%

70.7%

70.7%

70.7%

Average Interest Rate

0.87%

0.82%

0.75%

0.77%

0.77%

Average Remaining Maturity

2.5 years

2.3 years

1.8 years

1.6 years

1.1 years

LTV (Total Assets Basis)

43.6%

43.3%

43.2%

42.9%

42.9%

* The above does not include investment corporation bonds.

Distribution of Loan Maturities(JPY M)
10,000

Fixed Rate
Floating Rate
Bonds

8,800
8,000

7,000

6,000

4,950
450

4,000

4,500

4,500
2,500
500
2,000

3,000

2,000

2,220

1,800

370

0
Jan 2023

Jul 2023

Jan 2024

Jul 2024

Jan 2025

Jul 2025

Jan 2026© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Jul 2026

Jan 2027

Jul 2027

Jan 2028

51

Loan Details
Loan

LenderAmount(JPY million)

Floating/
Fixed

Interest Rate(%)

Borrowing Date

Maturity

Term Loan 4

SMBC, Mizuho, Shinsei, Resona, Fukuoka,
Nishi-Nippon City

4,500

Fixed

0.90750%

August 17, 2016

February 28, 2023

Term Loan 5

SMBC, Mizuho, Shinsei, Resona, Fukuoka,
Nishi-Nippon City

4,500

Fixed

0.98500%

August 17, 2016

August 31, 2023

Term Loan 7

SMBC, Mizuho, Shinsei, Resona, Fukuoka,
Nishi-Nippon City

1,800

Fixed

0.78750%

August 1, 2017

January 31, 2023

Term Loan 9

SMBC, Mizuho, Shinsei, Resona

1,500

Fixed

0.92000%

November 30, 2018

November 29, 2024

Term Loan 10

SMBC, Mizuho, Shinsei, Resona, Nishi-Nippon
City

2,220

Fixed

0.75450%

April 25, 2019

April 30, 2024

Term Loan 11

SMBC, Mizuho, Shinsei, Resona, Aozora

1,500

Fixed

0.73575%

July 19, 2019

November 29, 2024

Term Loan 13

SMBC, Mizuho, Shinsei, Resona, Fukuoka,
Nishi-Nippon City

2,000

Fixed

0.65600%

February 28, 2020

February 27, 2026

Term Loan 16

SMBC, Mizuho, Shinsei, Resona

7,000

Variable

0.56727%

November 30, 2021

November 30, 2022

Term Loan 17

SMBC

450

Variable

0.56727%

February 28, 2022

February 28, 2023

Total Borrowings

25,470

Average 0.77%

Average Remaining Loan Term 1.1 years

Issue Amount(JPY million)

Interest Rate

Redemption Date

Issuance Period

First Unsecured Investment Corporation Bond
November 25, 2020 (Callable bonds subordinated and limited toqualified institutional investors)

500

2.00%

April 30, 2026

5.4 years

Second Unsecured Investment Corporation
September 30, 2021 Bond (Callable bonds subordinated and limited
to qualified institutional investors)

370

2.00%

Total Bonds

870

Average 2.00%

Total Interest-Bearing Liabilities

26,340

Average 0.81%

Issue DateName

(as of July 31, 2022)

Lender Composition
Fukuoka3%
Nishi-Nippon
City
4%

Aozora1%

Resona
10%

Bonds
3%

SMBC
37%

Shinsei
12%
Mizuho30%

Fixed vs. Floating

Variable
28.3%

March 31, 2027

5.5 years
Fixed*
71.7%

Average Remaining Loan Term 1.2 years* Includes interest fixed via swaps© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

52

Shareholder Composition
Major Shareholders (as of July 31, 2022)
Name

By Number of Shares Held
No. OfShares

Share

Foreign Corporations & Individuals
Non-Financial Domestic Corporations

1

The Master Trust Bank of Japan,
Trust Account34,906

13.7%

36,820(14.4%)

2

Custody Bank of Japan, Ltd.,
Trust Account32,857

12.9%

16,260(6.4%)

Nomura Trust & Banking Co., Ltd.,
3
Investment Trust Account

11,7184.6%

4 Ichigo Trust Pte. Ltd.

10,9084.3%

BNP PARIBAS SECURITIES SERVICES
5 LUXEMBOURG/JASDEC/SECURITIES－
AIFM

9,243

3.6%

6 Ichigo Inc. (Sponsor)

6,500

2.5%

7 Individual Shareholder

3,270

1.3%

2,996

1.2%

8

DFA INTERNATIONAL REAL ESTATESECURITIES PORTFOLIO

Domestic Financial Institutions
Domestic Individuals

44,388(17.4%)

42,114(16.5%)

16,609(6.5%)

14,900(5.8%)

77,482(30.4%)

87,909(34.5%)

120,791(47.4%)

116,495(45.7%)

110,051(43.2%)

Jul 2021

Jan 2022(254,974 shares)

Jul 2022(254,974 shares)

81,103(31.8%)(Outstanding Shares) (254,974 shares)

By Number of Shareholders
Jul 31, 2021

Jan 31, 2022

Jul 31, 2022

Shareholders Shareholders Shareholders

9 Individual Shareholder

2,590

10 INTERACTIVE BROKERS LLC
Total

1.0%

Domestic Individuals

1,875

0.7%

116,86345.8%

Domestic Financial Institutions
City banks, trust banks
Regional banks
Other (including securities companies
Non-Financial Domestic Corporations
Foreign Corporations & Individuals
Total© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Share

16,17815,456

15,075

97.5%

35
4
–
31

34
4
–
30

34
4
–
30

0.2%
–
–
0.2%

226
154
16,593222
155
15,867212
146
15,467

1.4%
0.9%
100%

53

Appendix: Growth Roadmap, Sponsor, Shareholder Alignment© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

54

Ongoing Actions to Drive Increased Shareholder Value
Portfolio Growth & Diversification Drive Earnings Growth & Stability
Organic Growth

External Growth

Current Environment• Both Japanese and inbound demand has dropped
significantly due to Covid, generating ongoing impact on
the hotel market• Supply is exceeding demand in some areas in Japan due
to excessive number of new hotel openings• Financial strength of hotel operators needs to be closely
monitored to verify their rent-paying ability• No new growth driver is currently expected

Current Environment• Sales and acquisitions limited due to ongoing market
uncertainty• Market recovery is expected after vaccine & treatment
regimes become available• Competition for quality assets is expected to intensify

Actions• Proactively execute value-add capex tailored to each hotel• Sell hotels with limited growth potential• Increase earnings by revising fixed rent and variable rent
terms at lease renewal• Grow with sponsor support (Hakata Hotels/PROPERA)

Actions• Continue to grow portfolio of lodging-focused hotels, ahotel type with stable earnings• High underlying land values reflect Ichigo Hotel's highlocation attractiveness and value• Ichigo Hotel's focus on major regional cities withconvenient public transport access and revenue upsidefrom local events further reinforces earnings stability• Geographic diversification and centrally-located hotels withstable demand also support high earnings stability

Dividend Growth© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

55

Ichigo Hotel’s Sponsor: Ichigo (2337)
Core Businesses: Asset Management, Sustainable Real Estate, Clean Energy‒ Manages Ichigo Hotel (3463), Ichigo Office (8975), and Ichigo Green (9282)‒ Sustainable Real Estate business adds value to existing buildings bydrawing upon its real estate technologies and expertise‒ Deeply committed to CSR and Sustainability
Hiromi Miyake

Ichigo(Weightlifting)(TSE Prime 2337)

Ichigo Green (9282)

Ichigo Preserves andImproves Real Estate

The word “Ichigo” comes from the ancientJapanese proverb, Ichigo Ichie, literally meaning“One lifetime, one encounter.” The phrase was
first used by a 16th century master of the tea
ceremony, Sen no Rikyu. He called upon his
disciples to give total focus and sincerity to eachact of the tea ceremony for every guest, becausethat particular moment will only exist once andmust be fully lived and realized.
Ichigo embraces the Ichigo Ichie philosophy ofsincerity and service, and works to build strong
long-term relationships to support the success of
our clients, shareholders, and all stakeholders.

AssetManagement

Ichigo Investment Advisors

Ichigo Office (8975)
Ichigo Hotel (3463)

Sustainable
Real Estate

Clean Energy
Other

Ichigo Estate

Miyako City

Ichigo Owners

CentroIchigo Land Shinchiku

Storage Plus

Ichigo Real Estate Services
Fukuoka

Ichigo Animation

Ichigo Marché

Hakata Hotels

Ichigo ECO Energy

Ichigo Si© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

56

Synergies Between Ichigo Hotel and Sponsor‒ Strengthen acquisitions through leveraging Ichigo’s sourcing network‒ Increase asset value through Ichigo’s real estate value-add capabilities‒ Drive higher returns for Ichigo Hotel shareholders
Ichigo Hotel (3463)

Buy

Sponsor: Ichigo (2337)

Hotel

Value‐Add

Sell

Make The World
More Sustainable

Buy

Long-Term Asset Management(Grow Earnings for Shareholders)







Grow earnings via collaboration with hotel
operators
Grow earnings via rebranding and improving
lease terms
Grow earnings via smart cost control

Sell

Value-Add(Increase Asset Value)

Role

Value-add capex
On-going renovation and equipment renewal
Increase hotel attractiveness & competitiveness



Hard





Soft

Buy





Rectify building code issues
Seismic and safety reinforcement
Large-scale structural and equipment renewal
Change hotel operator/brandImprove lease terms
Improve hotel operations
Provide operations support (e.g., Hakata Hotels)

Third-Party Investors© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

Sell

57

Strong Sponsor Support
Changed Hotel Operator to Ichigo-owned Hakata Hotels− Veteran hotel operator with expertise in AI revenue management (PROPERA) –operates 13 hotels with focus on the Hakata (Fukuoka) area
− Maintained high occupancy, substantially outperforming other hotels(Hotels using PROPERA achieved 87.4% occupancy during the July 2022 fiscal period)− Became the operator of Court Hotel Kurashiki (rebranded as The OneFive Garden
Kurashiki) in February 2022 – already the operator of the Okayama, Fukuoka
Tenjin, and Osaka Sakaisuji hotels− Selected as operator among multiple candidates due to offering superior terms− Prevented loss of a hotel operator amidst Covid
Hotels Operated by Hakata Hotels
Kyushu(Fukuoka City)

Chugoku© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

KansaiTokyo

Hokkaido(Sapporo City)58

Hakata Hotels & PROPERA− Hakata Hotels, a consolidated subsidiary of Ichigo, is a hotel operator operating
13 hotels across Japan with many located in the Hakata (Fukuoka) area
− Hakata Hotels is deploying PROPERA, an AI-based revenue management systemdeveloped by Ichigo, to maximize earnings and increase guest satisfaction
Name

Hakata Hotels Inc.

Address

3-13-1 Haruyoshi, Chuo-ku, Fukuoka

Representatives

Minoru Ishihara, Representative Director & Chairman
Takanobu Kitazaki, Representative Director & President

Paid-In Capital

JPY 10 million (100% shareholding by Centro Co. Ltd., a 100% Ichigo subsidiary)

Establishment Date

March 2019

Main Business・Development, operation, lease, and management of retail buildings, hotels and restaurants
・Lease and management of real estate・Design and construction of buildings and interior designs
・Consulting services related to retail buildings, retail facilities, and restaurants

Operating Hotels(Number of rooms inparentheses)

Hokkaido: THE KNOT SAPPORO (140)Tokyo: HOTEL EMIT SHIBUYA (72)
Kyoto: The OneFive Kyoto Shijo (146)
Osaka: The OneFive Osaka Sakaisuji (130)
Okayama: The OneFive Okayama (208), The OneFive Garden Kurashiki (107)
Fukuoka: The OneFive Villa Fukuoka (50), Plaza Hotel Tenjin (205), Plaza Hotel Premiere (170),
Hotel Il Palazzo (62), The OneFive Marine Fukuoka (103), The OneFive Terrace Fukuoka (82),
The OneFive Fukuoka Tenjin (77)

PROPERA• Increases guest satisfaction• Operating track record of increasing earnings by 10-40%• Starting third-party sales© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

59

Portfolio Growth Opportunity via Ichigo Sponsor Support
20 Hotels (JPY 62B) in Ichigo Sponsor Pipeline as of May 31, 2022
− Lodging-focused hotels across Japan− Locations: Major cities such as Hokkaido, Tokyo, Yokohama, Osaka, and Fukuoka

Hokkaido

FukuokaTokyo

Hiroshima

Fukuoka

Yokohama
Osaka© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

60

Ichigo Hotel Overview
Ichigo Hotel
Name

Ichigo Hotel REIT Investment Corporation

Securities Code3463

Address

1-1-1 Uchisaiwaicho, Chiyoda-ku, Tokyo

Executive Director

Osamu Miyashita

Fiscal Periods

January (August 1 - January 31) and July (February 1 - July 31)

Asset Management Company
Name

Ichigo Investment Advisors Co., Ltd.

President

Hiroshi Iwai

Registration &Membership

Financial Instruments Dealer License (Investment
Management Services, Investment Advisory & Agency
Services, and Type II Financial Instruments Services)
Minister of Finance, Kanto Financial Bureau #318

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

61

Disclaimer
These materials are for informational purposes only, and do not constitute or form a part of, and should not be construed as,
an offer to sell or buy securities of Ichigo Hotel REIT Investment Corporation (Ichigo Hotel ).
These materials may contain forward-looking statements regarding the intent, belief or current expectations of Ichigo Hotelwith respect to financial condition and future results. These statements are based on certain assumptions founded on
currently available information. Accordingly, such statements are subject to risks and uncertainties, and there is no assurance
as to actual financial conditions or future results. Actual results may vary from those indicated in the forward-looking
statements.
In creating these materials, Ichigo Hotel and Ichigo Investment Advisors Co., Ltd. (IIA) have sought to provide accurate
information. However, there can be no assurance given as to the accuracy, certainty, validity or fairness of any suchinformation. The content of these materials is also subject to revision or retraction without prior notice.
This document is a translation. If there is any discrepancy between the Japanese version and the English translation,
the Japanese version shall prevail.

Make The World
More Sustainable

Contact:
Ichigo Hotel IR Desk (3463)
TEL: +81-3-3502-4892
E-mail： ir_hotel@ichigo.gr.jp
www.ichigo-hotel.co.jp/en
Ichigo is Japan’s first zero-carbon listed real estate company. We are taking
responsibility for our environmental footprint by offsetting our carbon emissions andinvesting in low-carbon technologies such as solar energy.

© Ichigo Investment Advisors Co., Ltd. Ichigo Hotel REIT Investment Corporation All rights reserved.

62