3Semi-Annualrd Fiscal Period
Report10 Years After

MasterAHEAD OF SCHEDULE

phase

Quality Phase Advancing Steadily
3-10 Years

Asset size growth by merger (September 2016)(2nd largest J-REIT)

GrowthStrategic property replacements(SPRs)

phase

3 Years

Distribution growth

Quality ph

ase

Oct.

2015

Merg

er

Our Growth Driver: Diversification

By
Property
Holdings

Top 10 Properties
as Percent ofPortfolio
25.4%

Stable Model
41.8%

Growth Model
58.2%

Residential
19.8%

By UseLogistics
15.8%

Retail Facilities(in residential areas)
6.1%

Office48.1%

Other Areas
17.2%

By
Geographic
Area
Tokyo
82.8%

Retail Facilities(near stations)
10.1%

8-5-1, Nishi-Shinjuku, Shinjuku Ward, TokyoON OUR WAY TO BECOMING
JAPAN’S LARGEST REIT

06

Investment
Analysis

Master Fund was listed in October 2015.

sales and acquisitions, our asset size now stands at ¥940.5
billion, an increase of roughly ¥156 billion. We have also
implemented Strategic Property Replacements (SPRs) toimprove the quality of our portfolio. Specifically, we have

Strategic Property
Replacements (SPRs)

On the other hand, we have acquired 19 properties for a

Redevelopment
for New Uses

19.2 years

5 to 6 years¥1.5 tln

with a total value of ¥137.4 billion, that we acquired throughLarge
High-Performance
Logistics Facilities

Retail Facility(Store of Goods)

Logistics¥932.8¥940.5*1¥784.6

Asset Size

years. These figures exclude the additional 19 properties,

Retail19.5 years

18.7 years

Merger with Top REIT

¥792.6

tively new properties, with an average age of less than 5

Our value chain with the sponsor merits attention. Of the

Office(Billions of yen)

total of ¥83.4 billion. For the most part, these have been rela-

the merger with TOP REIT.

BrandsProgress of Medium- to Long-term Management Strategy
Average Age

ing maintenance costs going forward.

Property
Acquisition

Price Examination /Negotiation
Investment Analysis

age of these properties was 39.2 years. The properties wedeclining in competitiveness or expected to generate grow-

03
04

Property
Acquisition
Pipelinesold 22 properties for a total of ¥64.0 billion. The average
sold were mainly properties that, due to their age, were02
Measuresto Improve
Property Value05

Much progress has been made since the new Nomuraof the three REITs. Factoring in all the currently announced

Maximize Value

Obtain Trading
Information

The Nomura Real Estate Group’s
Diversified REIT

Our asset size approached ¥783.6 billion upon the merger

01

Focused investment insponsor-developed properties
External growth throughvarious methods

Continue SPRs

Residential

Rental Housing(PROUDFLAT)

Mergertransactions mentioned above, we have sold 6 properties,

1st FP(5 months)

2nd FP

3rd FP

Quality phase Within 3 years of listingwith a total sale price of ¥31.3 billion, to Nomura Real Estate.
We have also acquired 11 properties, with a total price ofGrowth phase*1 Asset size after acquisitions andsales announced as of May 31, 2017.

SPR (Forecast)

Image of Disposition¥50.8 billion, from the sponsor. Moreover, we have been

4th FP(Forecast)

Increasing
Asset Value¥64.0*2(Billions of yen)granted preferential negotiation rights for the properties wesold. Following their future redevelopment, NMF plans to use
these rights to secure external growth opportunities.

Development

Acquisition

3rd round SPR
2nd round SPR

One of NMF’s strengths as a diversified REIT is our ability

¥32.6

¥22.5

to acquire a balanced array of properties from the sponsor,

Selective investment inproperties outside of the group
Utilizing sponsor

1st round SPR

avoiding overreliance on any one sector. A year and a half

¥5.0*1

SPR

following our listing, we are successfully leveraging our*1 Acquisition price basis.
*2 Asset size after acquisitions and sales announced as of May 31, 2017.

strengths as a diversified REIT as well as the strengths of
Nomura Real Estate as a general real estate developer.
Disposition

Asset
Management

06

Possible forredevelopment

Site Selection

01
Increasing
Brand Value

REAL ESTATEManagement
Pipeline

02
Revenue
Improve
Measures05

Disposition
Ito-Yokado
Mitsubishi Motors Mitsubishi Motors
Higashi-Narashino
Shibuya
Suginami
Store

Product Design/
Development

03
04

Supermarket

Leasehold Land

Leasehold Land

Sales

Leasing

Nomura Real Estate Master Fund

1

MERGER EVOLVED NMF INTOONE OF JAPAN’S BIGGEST REITs

MESSAGE FROM THE MANAGEMENT

3rd Fiscal Period Performance Highlights
Through the absorption type merger with TOP REIT, Inc., effective September 1, 2016, NMF’s asset size became the second
largest among J-REITs, at over ¥930 billion.
In the year and a half since the establishment of the new NMF, we have sold properties totaling ¥64.0 billion (acquisition
price basis). During that time, we have grown our asset size a total of ¥220.9 billion, further solidifying our presence within
the J-REIT industry.
The distribution per unit for the third fiscal period came to ¥3,028 or 4.2% above the forecast.

Operating Revenue

Net Income(Millions of yen)
40,000(Millions of yen)
12,00030,0009,000

20,0006,000

Satoshi Yanagita
10,000Executive Director
Nomura Real Estate Master Fund, Inc.

3,000

0

0
1st FP

2nd FP

3rd FP

4th FP(Forecast)

1st FP

2nd FP

Net Assets per Unit

Cash Distribution per Unit

(Yen)
140,000

(Yen)
4,000

3rd FP

4th FP(Forecast)¥251 in retained earnings,
equivalent to gain on sales
Please refer to p. 9 for details.

105,000

3,000

7,000

Gain on sales
299

Furthermore, after the end of the third fiscal period, we

steady progress toward becoming the premiere J-REIT byacquired eight properties as part of our strategic property

implementing its Medium- to Long-term Management

replacements (SPRs). At a total price of ¥38.9 billion, these

Strategy, a concrete roadmap for achieving NMF’s basic

included four Landport and Proud Flat properties acquired

strategies of securing stable income over the medium tofrom the sponsor, Nomura Real Estate Development Co.,

long term and ensuring the steady growth of assets underLtd. We also sold 6 properties for a total of ¥31.3 billion

management.

(including sales scheduled but not yet executed). TheseIn the third fiscal period, the absorption type merger

2,950
2,737
1,000

petitiveness due to age or increasing maintenance and

September 1, 2016, dramatically increased NMF’s asset

management costs, or for which we had received notice ofsize, making it the second largest among J-REITs. Since

contract termination from tenants.
positioned to further pursue both internal and external

addition to these assets, we acquired Landport Kashiwa

growth by leveraging the Nomura Real Estate Group’s devel-

Shonan II. As a result, at the end of the third fiscal peri-

opment capabilities, wide-ranging know-how and brand.

od, NMF’s portfolio comprised 272 properties with a
Performance in the leasing business, especially of offic-

0
1st FP

2 Nomura Real Estate Master Fund

2nd FP

3rd FPIn the fourth fiscal period and beyond, I believe we are

ferred from TOP REIT has gotten off to a good start. In

total acquisition price of ¥932.8 billion.
0

were properties that were expected to see declining com-with TOP REIT, Inc., which came into effect onthen, I think our management of the properties trans-

2,000

3,500

Since its launch in October 2015, NMF has been making

1st FP

2nd FP

3rd FP

4th FP(Forecast)As we move forward, we ask for your continued supportand encouragement.

es, was also favorable, with third fiscal period operating revenues of ¥34,714 million, operating profit of ¥11,244

Satoshi Yanagita

million, and net income of ¥8,670 million. As a result, theExecutive Director

per-unit distribution came to ¥3,028.

Nomura Real Estate Master Fund, Inc.

Nomura Real Estate Master Fund

3

DELIVERING ON
OUR MANAGEMENT STRATEGY
Property acquired from a third party

Property Acquisitions and Sales since NMF’s Establishment
Since NMF’s establishment on October 1, 2015,
we have acquired a total of 38 properties
with acquisitions totaling ¥220.9 billion(Billions of yen)
250

New acquisitions

New sales

220.9

Acquisitions

200

181.9
nORBESA

150

100

50

23.1

Sales

0

and Managing Executive Officer,
Ken Okada Director
Head of NMF Investment Management Group,
Nomura Real Estate Asset Management Co., Ltd.

28.7
-5

39.5

-22.5

-50

44.4

-32.6

-32.6
-64

-100

Announcement 1st SPR
roundof thenew NMF

2nd SPRround

3rd SPR September 1, Transactions
round 2016 absorption announced
type merger
following
the 3rd period

Nakaza Cui-daore Building

Acquisition price: ¥8.5 billion

Acquisition price: ¥11.6 billion

Appraisal value: ¥8.54 billion

Appraisal value: ¥11.6 billion

Appraised NOI yield: 5.3%

Appraised NOI yield: 3.7%

Location: Sapporo, Hokkaido

Location: Osaka, Osaka

Total floor area: 5,732.71 m2

Total floor area: 14,381.33 m2

Completed: April 13, 2006

Completed: February 18, 2004

Delivering Steady Internal Growth
Along with SPRs, internal growth centered on upside sectors is a pillar of management in the Quality phase. Japan’s
real estate leasing market continues to gradually recover.
The vacancy rate in the office sector, in particular, has been

Overview

being one of Japan’s largest diversified REITs while focus-

NMF achieved dramatic growth in asset size through themainly older properties with declining competitiveness.

ing on SPRs to improve the portfolio’s quality by selling

Properties Acquired fromThird Parties

low and steady. Average rents at NMF’s office properties
have also been rising, thanks to increases achieved throughtenant replacement and rent revisions, driving growth.

In addition to sponsor-developed properties, in the third fis-

In the retail sector, Universal CityWalk Osaka, locatedties from the sponsor for ¥27.6 billion. Of these, two are

cal period FRI acquired select, sought-after properties thatadjacent to Universal Studios Japan, continues to deliver

logistics facilities, two are residential facilities, and one is apromise stable revenues from third parties. Of these acqui-strong performance. Having increased the portion of ten-

¥2,950 yen. For the third fiscal period, the ¥3,028 per-unit

retail facility. We also sold four properties to the sponsor forsitions, nORBESA and Nakaza Cui-daore Building are note-ants paying sales-based rent, NMF has realized upside on

distribution was ¥123 yen, or 4.2%, higher than forecast.

a total of ¥13.8 billion. The sponsor plans to redevelop

worthy as particularly unique retail properties. When

this property.

This was mainly due to internal growth, including anthese properties, and NMF has preferential negotiation

investing in retail facilities, NMF’s primary criteria are theincrease in rental business revenue as well as reductions inrights to reacquire them afterward. In this way, we enjoy anvalue of the location, including liveliness of the area andrental business expenses and financing costs.

excellent relationship with the sponsor, and we hope totraffic volume on the roads they face, and each property’s

grow the fund by continuing to work together.

potential to attract customers.

merger with TOP REIT. As a result of the merger, NMF’s
total market capitalization surpassed ¥700 billion.
The fourth fiscal period per-unit distribution is forecast at

SPRs Leveraging Nomura Real
Estate’s Diverse Development
Capabilities

Since the third fiscal period, we have bought 5 proper-

The properties acquired from TOP REIT caused the aver-Both of the properties mentioned above are located in

An overview of internal growth by sector is given below.

OfficeBacked by a favorable office leasing market, the occupancy

age property age of the overall portfolio to rise slightly.

leading retail districts outside the Greater Tokyo Area. Eachrate of NMF’s office sector properties remained high, at

However, by acquiring newer properties—mainly properties

district is enjoying booming demand from foreign tourists

99.1%, as of the end of the third fiscal period. This highdeveloped by the sponsor—we aim to continue loweringand recognized as among Japan’s best. In addition to theiroccupancy rate empowers us to be aggressive in sourcing

the average building age of the portfolio.

highly sought-after locations, these properties are also well-operations and rent revisions.

NMF can maintain sustainable growth because it is able

known icons. One is home to a Ferris wheel and the otherMedium- to Long-term Management Strategy. This strategy

to invest in assets with diverse uses and because the spon-boasts the Cui-daore doll, a famous symbol of Osaka. Thesefrom TOP REIT, we secured a 29.7% rent increase on a new

divides the 10 years following NMF’s establishment into

sor is a general real estate developer with recognizedfeatures make the properties themselves tourist spots withlease for over 1,650 m2 of floor space. At the Shinjuku Nomura

three phases—the Quality phase, Growth phase andbrands in all four of NMF’s main sectors (office, retail,great draw to attract attention and customers. The two

Building, persistent and aggressive negotiating resulted in a

Master phase—and aims for stable management over thelogisitcs and housing). This strategic alignment provides

properties also have a number of tenants at below market

25.6% rent increase though tenant replacement.

long term through steady growth in asset size and theanother of NMF’s great strengths. Going forward, we will

rent level and therefore offer upside, as well. Consideringstrong establishment of the fund’s brand. We are now acontinue to make maximum use of the advantage of having

all these factors, we feel that these are highly exceptionalby the sponsor, we achieved rent increases for half of theyear and a half into the period covered by the Strategy.

a general real estate developer as our sponsor as we work

properties.

tenants with whom we renewed contracts in the third fiscal

After our listing in October 2015, we formulated ourIn the Quality phase, NMF aims to utilize the benefits of

toward sustainable growth.

At the NMF Aoyama 1-chome Building, which we acquired

Also, at properties in the PMO series, a brand developed

period. This was largely thanks to the strong competitiveness of properties developed by the sponsor.

4 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund

5

DELIVERING ON
OUR MANAGEMENT STRATEGY
RetailExamples at Specific Properties

Logistics
2nd FP
Mar. 1, 2016,
to Aug. 31, 2016

NMF’s retail sector portfolio is extremely stable, with 4.4%of total rent revenues accounted for by sales-linked rent.
operations, NMF is also working to raise fixed rents by negotiating increases upon rent revision. Looking at one of NMF’s
key retail properties, Universal CityWalk Osaka has seen

Shinjuku Nomura Building

Renewed leases for approximately
1,650 m2 of floor space in the 3rd fiscal
periodReplaced tenants for approximately 495
m2 of floor space in the 3rd fiscal period

Increased per-unit rent in spaces where
tenants changed by 29.7％

Increased per-unit rent in spaces where
tenants changed by 25.6％

Increased

50%

Increased 5

PMO Series
Contract Renewals

50%

Average rent increase
among tenants
whose rents went up

6.5%

4,736,769

5,044,381

307,611

6.5

Rental revenues

4,524,926

4,807,966

283,039

6.3

Other revenues

211,843

236,415

24,57111.6

2,224,840

86,8894.1

125,400

140,974

15,57412.4

the growing number of visitors to the nearby Universal

Property management fees

105,561

79,707(25,853)(24.5)

Studios Japan theme park. There are plans for additional

Property and other taxes

400,869

400,947

78

0

Utility expenses

155,193

167,660

12,4678.0

Property related expenses

investment in new attractions at Universal Studios Japan

Casualty insurance

going forward, so we expect continued growth from

Repairs and maintenance

Universal CityWalk Osaka.

Land rents
Depreciation

Retail
3rd FP
Sep. 1, 2016,
to Feb. 28, 2017

Change(Thousands of yen) (Thousands of yen) (Thousands of yen)
Property related revenues

8,030

8,609

578

7.2

191,513219,917

28,404

14.8

-

-

-

-

1,126,961

1,188,158

61,197

5.4

3rd FP
Sep. 1, 2016,
to Feb. 28, 2017

(Thousands of yen) (Thousands of yen) (Thousands of yen)
Property related revenues
Rental revenues(%)

12,950,477

16,653,589

3,703,112

28.6

11,729,101

15,179,494

3,450,392

29.4(5,556)(22.8)

steady implementation of these measures and getting

220,721

8.5

results. This focus bore fruit. We reached our target for

3,725,780

4,007,699

281,919

7.6

SPRs well ahead of schedule and saw significant growthin distributions. We have now largely achieved the targets(%)

we set for the Quality phase. That we have accomplished6,181,693

6,827,755

646,06210.5

5,363,669

5,946,068

582,398

10.9

Other revenues

818,023881,687

63,6637.8

2,886,644

3,331,157

444,51215.4

Property management costs

287,416

290,1652,749

1

ment market, major urban areas continue to see net popula-

Property management fees

170,221

175,498

5,276

3.1

tion inflow, and the residential sector is also seeing steady

Property and other taxes

397,283

524,161

126,878

31.9

growth in the proportion of units that achieve rent increases

Utility expenses

483,647

471,510(12,137)(2.5)

upon tenant change. Although this is not a sector with a

Casualty insurance

6,484

7,811

1,326

20.5

Repairs and maintenance361,484554,294

192,810

53.3

Land rents

101,552

101,55200Depreciation

754,179

843,080

88,900

11.8

Other rental expenses

324,373

363,081

38,708

11.9

Real estate rental profits

3,295,048

3,496,598

201,549

6.1

4,049,228

4,339,678

290,450

7.2

Residential

so much in the year and a half since the merger of the

In terms of logistics facilities, supply and demand remain

three REITs is the product of our daily efforts in asset

Concerning the environment surrounding the rental apart-

major upside expected in the future, we will continue working to increase rents.

3rd FP
Sep. 1, 2016,
to Feb. 28, 2017

Property related revenues
Rental revenues
Other revenues
Property related expenses

6,085,952

477,494

8.5

5,172,191

5,693,582

521,390

10.1(10.1)

436,266

392,370(43,896)

2,613,625

2,869,225

255,600

9.8

9,075

4.5

252,720

20.7

and the apparel industry, which are driving demand, as well

Property management fees

312,539

306,516(6,022)(1.9)

1,514,495

25.9

as the accompanying demand for third-party logistics (3PL)

Property and other taxes

297,001

335,644

38,64213.0

Property management costs

1,000,199

1,051,452

51,253

5.1

and additional demand arising in recent years from growing

Utility expenses

86,831

91,9875,155

5.9

Property management fees

286,265

339,806

53,54018.7

logistics sophistication in the food wholesaling industry.

Casualty insurance

7,166

7,577

411

5.7

Property and other taxes

1,220,331

1,756,020

535,68843.9

Although supply is expected to increase in 2017, demand

Repairs and maintenance341,186

421,618

80,432

23.6

986,204

1,075,927

89,722

9.1

15,933

21,718

5,785

36.3

939,668

252,753

36.8

Land rents

91,844

106,499

14,655

16.0

Depreciation

1,140,182

1,442,766

302,58426.5

ly large floor areas. This means the loss of a tenant canOther rental expenses

423,653

632,165

208,51149.2

result in a potentially long period without income. To

Real estate rental profits

7,098,947

9,287,565

2,188,617

30.8

address this, we are focusing efforts on extending contract

8,239,129

10,730,331

2,491,20230.2

periods and diversifying maturities.

ket is expected to regain balance.
Logistics sector properties are characterized by especial-surely and steadily bring the Quality phase to a successful
finish.

(%)

5,608,457

210,387

686,914

as we move forward is optimal. In this way, we aim totions, mainly from the sponsor.

Change201,312Casualty insurance

market and property conditions to ensure that our timing

offerings and accelerate growth based on property acquisi2nd FP
Mar. 1, 2016,
to Aug. 31, 2016

Property management costs

Repairs and maintenanceour first additional public offering—we will closely monitor

asset size of ¥1.5 trillion as we continue to execute public

Residential

tightly matched. This reflects the impact of online shopping

for high-performance logistics facilities is solid, so the mar-management. With regard to the remaining task—realizing

In the next stage, the Growth phase, we will target an

1,474,095

6 Nomura Real Estate Master Fund

past year and half, management has focused on the

18,864

7,366,024

NOI

the Quality phase of its management strategy. Over the

2,819,540

1,221,375

Utility expenses

NMF is currently advancing the measures outlined under

24,4205,851,529

Other revenues
Property related expenses

Quality Phase Implementation
Continued Steadily and Ahead of
Schedule in the 3rd Fiscal Period

2,598,818

NOI

Logistics

Changem2, and the portfolio remained highly diversified.

Other rental expenses(Thousands of yen) (Thousands of yen) (Thousands of yen)
2nd FP
Mar. 1, 2016,
to Aug. 31, 2016

the gross leasable area of the portfolio was 1,968,528.97

Real estate rental profits

Rental revenues

NOI

Officeratio of investment in the Greater Tokyo area was 82.8%,(%)

2,137,950

Property related expenses

Unchanged 5

Property related revenues

272, with a total acquisition price of ¥932,896 million. The

Property management costs

Lease Renewals at PMO Series Properties

Unchanged

under review, the number of properties held by NMF was
Changesteadily expanding retail sales and sales-linked rent thanks to

2nd FP
Mar. 1, 2016,
to Aug. 31, 2016

Backed by high tenant satisfaction, NMF raised rents for five of the 10
tenants that renewed contracts in the 3rd period (and decreased rents
for none)

3rd FP
Sep. 1, 2016,
to Feb. 28, 2017

(Thousands of yen) (Thousands of yen) (Thousands of yen)

While spreading out contract maturities to ensure stable

NMF Aoyama 1-chome Building(the former Akasaka Oji Building)

Reflecting the above factors, at the end of the fiscal period

Land rents
Depreciation

-

-

-

-

1,184,363

1,283,362

98,998

8.4

Other rental expenses

183,223

212,130

28,906

15.8

Real estate rental profits

2,994,832

3,216,726

221,893

7.4

4,179,196

4,500,088

320,892

7.7

NOI

Nomura Real Estate Master Fund

7

DELIVERING ON
OUR MANAGEMENT STRATEGY
NMF’s Financial Strategy

Distribution Policy

Refinancing in the 3rd Fiscal Period
Refinancing

In the third fiscal period, NMF took advantage of the

Debt Repaid (At time of repayment)

favorable financing environment and refinanced debt
worth ¥47.9 billion, both extending maturities and lowering interest rates. As a result, our interest-bearing debt
has an average remaining duration of 4.3 years with an

Total¥49,012 million

Total¥47,950 million

Average interest rate

0.70%

Average interest rate

0.63%

Average remaining
duration

4.6 years

Average remaining
duration

7.6 years

average interest rate of 0.95%, and the LTV ratio is about* Excludes payments on amortized loans(¥42.8 million).

45.1%. Going forward, we plan to utilize equity increases

Interest-Bearing Debt

to gradually reduce the LTV ratio.

Feb. 29, 2016
(1st FP end)

NMF seeks to diversify debt maturities so that about¥20 to ¥30 billion matures each period. However,
because of the large volume of borrowings transferredfrom TOP REIT, ¥50 billion in debt will reach maturity inthe fourth fiscal period. As in the third fiscal period, we
will continue negotiating to extend debt periods andreduce interest rates.

To ensure stable distributions over the medium and long term, we have adopted a new policy for handling gains on sales.*New Funding (At period-end)

Aug. 31, 2016
(2nd FP end)

Under this new policy, by adjusting distributions in excess of net income, an amount equivalent to gain on sales of properties
may be designated as retained earnings.
*This does not constitute a change to NMF’s basic distribution policy.

Basic Distribution Policy

Distribution Policy for Periods with Gain on Sales

Distribute net income +goodwill amortization expenses

To ensure stable distributions over the medium and long term,by adjusting distributions in excess of net income, a cash amount equivalent
to gain on sales may be designated as retained earnings.*

Feb. 28, 2017
(3rd FP end)

Total interest-bearing debt

¥403,164 million¥409,771 million¥498,784 million

Average remaining duration

3.96 years

4.36 years

4.31 years

Average interest rate

1.09%

1.03%

0.95%

Ratio of long-term debt

84.1%

85.9%

83.2%

Ratio of fixed-rate debt

91.4%

95.8%

92.2%

LTV

43.4%

43.8%

45.1%

Distributions
in excess of
net income

Goodwill
amortization

Net
incomeNet
incomeNet income(as on statementof income)

Total
distributions

Retained earnings
equivalent to gain on sales

Gain onsales

RetainGoodwill
amortization

Gain onsales
Net income
less gainon salesNet income
less gainon salesNet income
less gainon salesNet income(as on statementof income)

Total
distributions

Distribution
breakdownDistributionsof net income

Distributions in excess
of net income

Gain onsales

Gain on sales is distributed,
and distributions in excess
of net income are adjusted
accordingly*NMF’s policy is, in principle, to retain earnings within the scope that will not be subject to income tax,
up to the amount of goodwill amortization expenses.

Diversification of Repayment Dates

Policy for Retaining Forecast Gain on Sales in the 4th Fiscal Period
Gain on sales

Diversification of Repayment Dates
Debts Acquired with TOP

Unrelated Debt

(Millions of yen)
REIT Bonds(Billions of yen; Rounded)
60

Goodwill amortization

1,052

Retain

1,052

2,622

1,570
1,052

1,052

9,724

9,724

9,724

40

Net income(as on statementof income)20

Net income less gain on sales
Amount equivalent togain on sales retained(¥1,052 million)

Use of Retained Cash
When a decrease in distributions is expected due to the sudden
actualization of risk, retained cash can be used to pay distributions
in excess of net income.*(Illustration for a period with distributions in excess of net income)Distributions inexcess of net income

Distribution ofretained cash
Goodwill
amortization

Retained earnings
equivalent togain on sales(¥12,340 million)

Distributions inexcess of net income

Distributions of
net income

Total
distributions

Net income(as on statementof income)

Total
distributions*Retained cash may also be used for the acquisition of new properties.

Changes to the Asset Management Fee Structure0

4th 5th 6th 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th 28th 29th 30th 31st
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
FP
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FP
FP
Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb. Aug. Feb.
2017 2018 2018 2019 2019 2020 2020 2021 2021 2022 2022 2023 2023 2024 2024 2025 2025 2026 2026 2026 2028 2028 2028 2028 2028 2028 2028 2031

Commitment Lines

Loan Limit(commitment period)

40(one year)

Commitment Line 2

10(three years)

These changes are intended to create a tighter correlation with unitholder profit. The revised management fee rates will beeffective from the fifth fiscal period (ending February 28, 2018).
Overview of Changes

Credit Ratings(bln)

Commitment Line 1

The revisions to the asset management fee rates shown below were approved at the May 26, 2017 Unitholder’s Meeting.

Rating Agency

LT Issuer Rating

Outlook

JCR

AA

StablePrevious AssetManagement Fee
System*−After Changes

R&I
Participating
Financial Institutions

Tokyo-Mitsubishi UFJ,
Sumitomo Mitsui,
Mizuho,Mitsubishi UFJ Trust,
Sumitomo Mitsui Trust

8 Nomura Real Estate Master FundTokyo-Mitsubishi UFJ,
Sumitomo Mitsui

S&P

A+

A

Total assets (excluding goodwill) × 0.6% (Annual basis)
Total assets-linked portion will be reduced
from 0.6% of total assets to 0.45%+

New net income-linked portion,
Asset management fee II, added

Asset management fee I

Asset management fee II

Total assets (excluding goodwill) × 0.45% (Annual basis)

Net income* × 5.5% (Annual basis)

Reduced total
assets-linked fees

New netincome-linked fees

StableStable*“Net income” here refers to income before income taxes as calculated according to the standards of Japanese Generally Accepted Accounting Principles(but before the deductions of management fee II and non-deductable consumption tax related to management fee II) plus goodwill deductions,
minus gain on negative goodwill, and after the settlement of any losses carried forward.

Nomura Real Estate Master Fund

9

PORTFOLIO TABLE(As of the End of the 3rd Fiscal Period)
Property Name

Location

Acquisition
Price

Office Buildings
Of-T-001 Shinjuku Nomura Building

Rt-T-010

FESTA SQUARE

Saitama, Saitama

2,600

Rs-T-013 PROUD FLAT Kamata II

Ota, Tokyo

Edogawa, Tokyo

1,140

Shinjuku, Tokyo

43,900Rt-T-011

GEMS Shibuya

2,490

Rs-T-014 PROUD FLAT Shinotsuka

Toshima, Tokyo

623

Rs-T-093 PRIME URBAN Itabashi Kuyakushomae Itabashi, Tokyo

1,080

Of-T-002 NRE Tennozu Building

Shinagawa, Tokyo

20,500Rt-T-012

Sundai Azamino

Shibuya, Tokyo
Yokohama, Kanagawa

1,700

Rs-T-015 PROUD FLAT Kiyosumi Shirakawa

Koto, Tokyo

928

Rs-T-094 PRIME URBAN Asakusa

Taito, TokyoOf-T-003 Kojimachi Millennium Garden

Chiyoda, Tokyo

26,700Rt-T-013

EQUINIA Aobadai

Yokohama, Kanagawa

1,560

Rs-T-016 PROUD FLAT Monzen Nakacho II

Koto, Tokyo

652

Rs-T-095 PRIME URBAN Machiya South Court

Arakawa, Tokyo

1,910

Of-T-004 NOF Nihonbashi Honcho Building

Chuo, Tokyo

10,914

Rt-T-014

Megalos Kanagawa

Yokohama, Kanagawa

1,000

Rs-T-017 PROUD FLAT Monzen Nakacho I

Koto, Tokyo

1,030

Rs-T-096 PRIME URBAN Musashi Koganei

Koganei, Tokyo

1,910

Of-T-005 Tennozu Park Side Building

Shinagawa, Tokyo

12,700Rt-T-015

Mitsubishi Motors Meguro

Meguro, Tokyo

2,740

Rs-T-018 PROUD FLAT Fujimidai

Nerima, Tokyo

1,470

Rs-T-097 PRIME URBAN Musashino Hills

Koganei, Tokyo

1,280

Of-T-006 NMF Shinjuku Minamiguchi Building

Shibuya, Tokyo

10,000Rt-T-016

Mitsubishi Motors Chofu

Chofu, Tokyo

1,760

Rs-T-019 PROUD FLAT Asakusa

1,920

Rs-T-098 PRIME URBAN Koganei Honcho

Koganei, TokyoOf-T-007 NMF Shibuya Koen-dori Building

Shibuya, Tokyo

10,400Rt-T-017

Mitsubishi Motors Shibuya

Shibuya, Tokyo

1,570

Rs-T-020 PROUD FLAT Yokohama

Taito, Tokyo
Yokohama, Kanagawa

2,090

Rs-T-099 PRIME URBAN Kumegawa

Of-T-008 Secom Medical Building

Chiyoda, Tokyo

11,100Rt-T-018

Mitsubishi Motors Nerima

Nerima, Tokyo

1,240

Rs-T-021 PROUD FLAT Kamioooka

Yokohama, Kanagawa

2,710

Of-T-009 NMF Shiba Building

Minato, Tokyo

7,040

Rt-T-019

Mitsubishi Motors Kawasaki

Kawasaki, Kanagawa

950

Rs-T-022 PROUD FLAT Tsurumi II

Yokohama, Kanagawa

Of-T-010 Nishi-Shinjuku Showa Building

Shinjuku, Tokyo

8,140

Rt-T-020

Mitsubishi Motors Takaido

Suginami, Tokyo

850

Rs-T-023 PRIME URBAN Azabu Juban

Of-T-011 NRE Shibuya Dogenzaka Building

Shibuya, Tokyo

5,310

Rt-T-021

Mitsubishi Motors Katsushika

Katsushika, Tokyo

800

Of-T-013 Iwamoto-cho Toyo Building

Chiyoda, Tokyo

4,050

Rt-T-022

Mitsubishi Motors Higashikurume

Higashikurume, Tokyo

800

Of-T-015 NMF Surugadai Building

Chiyoda, Tokyo

4,690

Rt-T-023

Mitsubishi Motors Setagaya

Setagaya, TokyoOf-T-016 PMO Nihonbashi Honcho

Chuo, Tokyo

4,320

Rt-T-024

Mitsubishi Motors Suginami

Of-T-017 PMO Nihonbashi KayabachoChuo, Tokyo

5,010

Rt-T-025

Of-T-018 NMF Gotanda Ekimae Building

Shinagawa, Tokyo

4,430

Of-T-019 NRE Higashi-nihonbashi Building

Chuo, TokyoOf-T-020 PMO Akihabara

Settlement
Number(Millionsof yen)Settlement
Number

Property Name

Location

Acquisition
Price(Millionsof yen)Settlement
Number

Property Name

Location

Acquisition
Price(Millionsof yen)3,320

Settlement
Number

Property Name

Rs-T-091 PRIME URBAN Kasai East

Location

Acquisition
Price(Millionsof yen)

384

791
1,520

1,650

Higashimurayama, Tokyo
Rs-T-100 PRIME URBAN Musashi Kosugi comodo Kawasaki, Kanagawa
Kawasaki, Kanagawa
Rs-T-101 PRIME URBAN Kawasaki

Minato, Tokyo

1,100

Rs-T-102 PRIME URBAN Shinyurigaoka

Kawasaki, Kanagawa

1,020

Rs-T-024 PRIME URBAN Akasaka

Minato, Tokyo

938

Rs-T-103 PRIME URBAN Tsurumi Teraya

Yokohama, Kanagawa

493

Rs-T-025 PRIME URBAN Tamachi

Minato, Tokyo972

Rs-T-105 PRIME URBAN Urayasu

Urayasu, Chiba

804

770

Rs-T-026 PRIME URBAN Shibaura

Minato, Tokyo

1,830

Rs-T-106 PRIME URBAN Gyotoku I

Ichikawa, Chiba

633

Suginami, Tokyo

740

Rs-T-028 PRIME URBAN Yoyogi

Shibuya, Tokyo359

Rs-T-107 PRIME URBAN Gyotoku II

Ichikawa, Chiba

730

Mitsubishi Motors Sekimachi

Nerima, Tokyo

600

Rs-T-029 PRIME URBAN Ebisu II

Shibuya, Tokyo

1,140

Rs-T-108 PRIME URBAN Gyotoku Ekimae

Ichikawa, Chiba

488

Rt-T-026

Mitsubishi Motors Higashiyamato

Higashiyamato, Tokyo

450

Rs-T-030 PRIME URBAN Bancho

Chiyoda, Tokyo

1,090

Rs-T-109 PRIME URBAN Gyotoku Ekimae II

Ichikawa, Chiba

469

3,570

Rt-T-027

Mitsubishi Motors Motosumiyoshi

Kawasaki, Kanagawa

370

Rs-T-031 PRIME URBAN Chiyoda Fujimi

Chiyoda, Tokyo

679

Rs-T-110 PRIME URBAN Gyotoku III

Ichikawa, Chiba

747

Chiyoda, Tokyo

4,240

Rt-T-028

Mitsubishi Motors Kawagoe

Kawagoe, Saitama

350

Rs-T-032 PRIME URBAN Iidabashi

Chiyoda, Tokyo

2,040

Rs-T-111 PRIME URBAN Nishi Funabashi

Funabashi, Chiba

Of-T-021 Hatchobori NF Building

Chuo, Tokyo

2,480

Rt-T-029

Mitsubishi Motors Edogawa

Edogawa, Tokyo

200

Rs-T-033 PRIME URBAN Ebisu

Meguro, Tokyo

1,260

Rs-T-112 PRIME URBAN Kawaguchi

Kawaguchi, Saitama

Of-T-022 NMF Kanda Iwamoto-cho Building

Chiyoda, Tokyo

4,160

Rt-T-030

Mitsubishi Motors Sayama

Sayama, Saitama

160

Rs-T-034 PRIME URBAN Naka Meguro

Meguro, Tokyo

1,410

Rs-T-113 PROUD FLAT Hatchobori

Chuo, TokyoOf-T-023 NMF Takanawa Building

Shinagawa, Tokyo

2,830

Rt-T-031

NRE Kichijoji Building

Musashino, Tokyo

5,310

Rs-T-035 PRIME URBAN Gakugei Daigaku

Meguro, Tokyo

775

Rs-T-114 PROUD FLAT Itabashi Honcho

Itabashi, Tokyo

720

Of-T-024 PMO Hatchobori

Chuo, Tokyo

2,880

Rt-T-032

GEMS Ichigaya

Chiyoda, Tokyo

2,080

Rs-T-036 PRIME URBAN Senzoku

Meguro, Tokyo

474

Rs-T-115 PRIME URBAN Meguro Mita

Meguro, Tokyo

1,058

Of-T-026 PMO Nihonbashi Odenmacho

Chuo, Tokyo

2,210

Rt-T-033

Sagamihara Shopping Center

Sagamihara, Kanagawa

6,840

Rs-T-037 PRIME URBAN Meguro Riverside

Meguro, Tokyo

414

Rs-T-116 Fukasawa House Towers H&I

Setagaya, Tokyo

7,140

Of-T-028 PMO Higashi-nihonbashi

Chuo, Tokyo

1,690

Rt-T-034

Musashiurawa Shopping Square

Saitama, Saitama

2,720

Rs-T-038 PRIME URBAN Meguro Ohashi Hills

Meguro, Tokyo

2,970

Rs-T-117 PRIME URBAN Toyosu

Koto, Tokyo

5,290

Of-T-029 NRE Ueno Building

Taito, Tokyo

6,470

Rt-T-035

Ito-Yokado Higashi-Narashino Store

Narashino, Chiba

649

Rs-T-039 PRIME URBAN Meguro Aobadai

Meguro, Tokyo

1,310

Rs-T-118 PRIME URBAN Nihonbashi Kayabacho Chuo, Tokyo

2,850

Of-T-030 NOF Technoport Kamata Center Building Ota, Tokyo

4,780

Rt-S-001 Universal CityWalk Osaka

Osaka, Osaka

15,500Rs-T-040 PRIME URBAN Gakugei Daigaku II

Meguro, Tokyo

1,080

Rs-T-119 PRIME URBAN Yoga II

Setagaya, Tokyo

1,320

Of-T-031 NF Hongo Building.

Bunkyo, Tokyo

4,890

Rt-S-002 Izumiya Senrioka

Suita, Osaka

8,930

Rs-T-041 PRIME URBAN Naka Meguro II

Meguro, Tokyo

2,850

Rs-T-120 PRIME URBAN Musashi-Koganei II

Koganei, Tokyo

1,310

Of-T-034 Crystal Park Building

Musashino, Tokyo

3,390

Rt-S-003 Merad Owada

Osaka, Osaka

6,640

Rs-T-042 PRIME URBAN Kachidoki

Chuo, Tokyo

2,570

Rs-S-001 PROUD FLAT Itsutsubashi

Sendai, Miyagi

652

Of-T-035 NMF Kichijoji Honcho Building

Musashino, Tokyo

1,780

Rt-S-004 Izumiya Yao

Yao, Osaka

4,406

Rs-T-043 PRIME URBAN Shinkawa

Chuo, Tokyo

2,100

Rs-S-002 PROUD FLAT Kawaramachi

Sendai, Miyagi

735

Of-T-036 Faret Tachikawa Center Square

Tachikawa, Tokyo

3,850

Rt-S-005 Izumiya Obayashi

Takarazuka, Hyogo

3,020

Rs-T-044 PRIME URBAN Nihonbashi Yokoyamacho Chuo, Tokyo

4,220

Rs-S-003 PROUD FLAT Shin Osaka

Osaka, Osaka

1,620

Of-T-037 NMF Kawasaki Higashiguchi Building Kawasaki, Kanagawa

7,830

Rt-S-006 Ichibancho stear

Sendai, Miyagi

4,700

Rs-T-045 PRIME URBAN Nihonbashi Hamacho

Chuo, Tokyo

1,550

Rs-S-005 PRIME URBAN Kita Juyo Jo

Sapporo, Hokkaido

274

Of-T-038 NMF Yokohama Nishiguchi Building

Yokohama, Kanagawa

5,460

Rt-S-007 EQUINIA Aobadori

Sendai, Miyagi

1,640

Rs-T-046 PRIME URBAN Hongo Ikizaka

Bunkyo, Tokyo

557

Rs-S-006 PRIME URBAN Odori Koen I

Sapporo, Hokkaido

502

Of-T-039 NMF Shin-Yokohama Building

Yokohama, Kanagawa

2,620

Rt-S-008 MEL Building

Sendai, Miyagi

1,060

Rs-T-047 PRIME URBAN Hakusan

Bunkyo, Tokyo

866

Rs-S-007 PRIME URBAN Odori Koen II

Sapporo, Hokkaido

334

Of-T-041 PMO Tamachi

Minato, Tokyo

6,210

Subtotal (43 properties)

Rs-T-048 PRIME URBAN Yotsuya Gaien Higashi Shinjuku, Tokyo

1,490

Rs-S-008 PRIME URBAN Kita Juichi Jo

Sapporo, Hokkaido

547

Of-T-042 PMO Ginza Hatchome

Chuo, Tokyo

3,970

Rs-T-050 PRIME URBAN Nishi Shinjuku I

Shinjuku, Tokyo

1,090

Rs-S-009 PRIME URBAN Miyanosawa

Sapporo, Hokkaido

475

Rs-T-051 PRIME URBAN Nishi Shinjuku II

Shinjuku, Tokyo

885

Rs-S-010 PRIME URBAN Odori Higashi

Sapporo, Hokkaido

394

151,422

1,940
962

761
1,580
920

3,900

Logistics Facilities

44,100

Lg-T-001 Landport Urayasu

Urayasu, Chiba

17,400Rs-T-052 PRIME URBAN Shinjuku Naitomachi

Shinjuku, Tokyo430

Rs-S-011 PRIME URBAN Chiji Kokan

Sapporo, Hokkaido

249

18,200

Lg-T-002 Landport Itabashi

Itabashi, Tokyo

15,710Rs-T-053 PRIME URBAN Nishi Waseda

Shinjuku, Tokyo

421

Rs-S-012 PRIME URBAN Maruyama

Sapporo, Hokkaido

229

Minato, Tokyo

10,400

Lg-T-003 Landport Kawagoe

Kawagoe, Saitama

13,700Rs-T-054 PRIME URBAN Shinjuku Ochiai

Shinjuku, Tokyo

594

Rs-S-013 PRIME URBAN Kita Nijuyo Jo

Sapporo, Hokkaido

437

Chiyoda, Tokyo

8,330

Lg-T-004 Landport Atsugi

Atsugi, Kanagawa

11,410Rs-T-055 PRIME URBAN Mejiro

Shinjuku, Tokyo

1,430

Rs-S-014 PRIME URBAN Sapporo Idaimae

Sapporo, Hokkaido

616

Of-T-048 Harumi Island Triton Square Office Tower Z Chuo, TokyoOf-T-049 Shinkawa Chuo Building
Chuo, Tokyo

8,180

Lg-T-005 Sagamihara Tana Logistics Center

Sagamihara, Kanagawa

10,600Rs-T-056 PRIME URBAN Kagurazaka

Shinjuku, Tokyo

2,900

Rs-S-015 PRIME URBAN Sapporo Riverfront

Sapporo, Hokkaido

4,480

6,070

Lg-T-006 Sagamihara Onodai Logistics Center

Sagamihara, Kanagawa

8,700

Rs-T-057 PRIME URBAN Sangen Jaya III

Setagaya, Tokyo

718

Rs-S-016 PRIME URBAN Kita Sanjo Dori

Sapporo, Hokkaido

1,730

Of-T-050 Shinjuku EAST Building
Of-T-051 Shiba-Koen Building

Shinjuku, Tokyo

5,710

Lg-T-007 Landport Hachioji

Hachioji, Tokyo

8,250

Rs-T-058 PRIME URBAN Chitose Karasuyama

Setagaya, Tokyo

717

Rs-S-017 PRIME URBAN Nagamachi Icchome

Sendai, Miyagi

1,140

Minato, Tokyo

3,620

Lg-T-008 Landport Kasukabe

Kasukabe, Saitama

7,340

Rs-T-060 PRIME URBAN Sangen Jaya

Setagaya, Tokyo

724

Rs-S-018 PRIME URBAN Yaotome Chuo

Sendai, Miyagi

466

Of-T-052 Ginza Oji Building
Of-T-053 Faret East Building

Chuo, Tokyo

1,850

Lg-T-009 Funabashi Logistics Center

Funabashi, Chiba

4,660

Rs-T-061 PRIME URBAN Minami Karasuyama

Setagaya, Tokyo

667

Rs-S-019 PRIME URBAN Tsutsumidori Amamiya Sendai, Miyagi

949

1,850
6,250

Lg-T-010 Atsugi Minami Logistics Center B Tower Atsugi, Kanagawa

4,590

Rs-T-062 PRIME URBAN Karasuyama Galleria

Setagaya, Tokyo

549

Rs-S-020 PRIME URBAN Aoi

Nagoya, Aichi

712

Of-S-001 Sapporo North Plaza

Tachikawa, Tokyo
Sapporo, Hokkaido

Lg-T-011 Hanyu Logistics Center

Hanyu, Saitama

3,810

Rs-T-063 PRIME URBAN Karasuyama Court

Setagaya, Tokyo

338

Rs-S-021 PRIME URBAN Kanayama

Nagoya, Aichi

553

Of-S-002 NRE Sapporo Building

Sapporo, Hokkaido

4,140

Lg-T-012 Kawaguchi Logistics Center B Tower

Kawaguchi, Saitama

3,750

Rs-T-065 PRIME URBAN Chitose Funabashi

Setagaya, Tokyo

746

Rs-S-022 PRIME URBAN Tsurumai

Nagoya, Aichi

1,020

Of-S-004 NMF Sendai Aoba-dori Building

Sendai, Sendai

2,030

Lg-T-013 Kawaguchi Logistics Center A Tower

Kawaguchi, Saitama

2,830

Rs-T-066 PRIME URBAN Yoga

Setagaya, Tokyo

1,390

Rs-S-023 PRIME URBAN Kamimaezu

Nagoya, Aichi

1,590

Of-S-005 NOF Utsunomiya Building

Utsunomiya, Tochigi

2,320

Lg-T-014 Atsugi Minami Logistics Center A Tower Atsugi, Kanagawa

2,690

Rs-T-067 PRIME URBAN Shinagawa Nishi

Shinagawa, Tokyo

494

Rs-S-024 PRIME URBAN Izumi

Nagoya, Aichi

3,770

Of-S-006 NMF Nagoya Fushimi Building

Nagoya, Aichi

2,240

Lg-T-015 Kawaguchi Ryoke Logistics Center

Kawaguchi, Saitama

10,790Rs-T-068 PRIME URBAN Osaki

Shinagawa, Tokyo

1,860

Rs-S-025 PRIME URBAN Esaka I

Suita, Osaka

652

Of-S-007 NMF Nagoya Yanagibashi Building

Nagoya, Aichi

2,280

Lg-T-016 Landport Kashiwa Shonan II

Kashiwa, Chiba

10,800Rs-T-069 PRIME URBAN Oimachi II

Shinagawa, Tokyo

1,040

Rs-S-026 PRIME URBAN Esaka II

Suita, Osaka794

Of-S-008 Omron Kyoto Center Building

Kyoto, Kyoto

18,300

Lg-S-001 Ota Nitta Logistics Center

Ota, Gunma

3,430

Rs-T-070 PRIME URBAN Yukigaya

Ota, Tokyo

951

Rs-S-027 PRIME URBAN Esaka III

Suita, Osaka

1,190

Of-S-009 SORA Shin-Osaka 21

Osaka, Osaka

12,100

Lg-S-002 Ota Higashishinmachi Logistics Center

Ota, Gunma

2,170

Rs-T-071 PRIME URBAN Omori

Ota, Tokyo

905

Rs-S-028 PRIME URBAN Tamatsukuri

Osaka, Osaka

1,020

Of-S-010 NRE Osaka Building

Osaka, Osaka

6,100

Lg-S-003 Ota Kiyohara Logistics Center

Ota, Gunma

650

Rs-T-072 PRIME URBAN Denenchofu Minami

Ota, Tokyo

774

Rs-S-029 PRIME URBAN Sakaisuji Honmachi

Osaka, Osaka

1,810

Of-S-011 NRE Nishi-Umeda Building

Osaka, Osaka

3,450

Lg-S-004 Chiyodamachi Logistics Center

Oura, Gunma

330

Rs-T-073 PRIME URBAN Nagahara KamiikedaiOta, Tokyo

1,720

Rs-S-030 PRIME URBAN Hakata

Fukuoka, Fukuoka

588

Of-S-012 NRE Yotsubashi Building

Osaka, Osaka

4,000

Lg-S-005 Hirakata Kuzuha Logistics Center

Hirakata, Osaka

3,460

Rs-T-075 PRIME URBAN Nakano Kamitakada

Nakano, Tokyo

498

Rs-S-031 PRIME URBAN Yakuin Minami

Fukuoka, Fukuoka

265

Of-S-013 NRE Hiroshima Building

Hiroshima, Hiroshima

2,280

Subtotal (21 properties)

Rs-T-076 PRIME URBAN Takaido

Suginami, Tokyo

1,060

Rs-S-032 PRIME URBAN Kashii

Fukuoka, Fukuoka

398

Of-S-014 NMF Hakata Ekimae Building

Fukuoka, Fukuoka

4,210

Rs-T-077 PRIME URBAN Nishi Ogikubo

Suginami, Tokyo

414

Rs-S-033 PRIME URBAN Hakata Higashi

Fukuoka, Fukuoka

622

Of-S-015 NMF Tenjin-Minami Building

Fukuoka, Fukuoka

2,230

Rs-T-078 PRIME URBAN Nishi Ogikubo II

Suginami, Tokyo

1,790

Rs-S-034 PRIME URBAN Chihaya

Fukuoka, Fukuoka

Rs-T-079 PRIME URBAN Otsuka

Toshima, Tokyo

730

Rs-S-035 PRIME URBAN Chikusa

Nagoya, Aichi

Subtotal (147 properties)

Of-T-043 PMO Shibakoen
Minato, TokyoOf-T-044 NEC Head Office Building
Minato, TokyoOf-T-045 Harumi Island Triton Square Office Tower Y Chuo, TokyoOf-T-046 Akasaka Oji Building
Of-T-047 Kanda Nishiki-cho 3-chome Building

448,654

Subtotal (60 properties)
Retail Facilities

147,070

Residential Facilities
Rs-T-001 PROUD FLAT Shirokane Takanawa

Minato, Tokyo

3,400

Rs-T-002 PROUD FLAT Yoyogi Uehara

Shibuya, Tokyo

989

Rs-T-080 PRIME URBAN Komagome

Toshima, Tokyo

437

Rs-T-003 PROUD FLAT Hatsudai

Shibuya, Tokyo

713

Rs-T-081 PRIME URBAN Ikebukuro

Toshima, Tokyo

3,800

Rt-T-001

Morisia Tsudanuma

Narashino, Chiba

16,600Rs-T-004 PROUD FLAT Shibuya Sakuragaoka

Shibuya, Tokyo

750

Rs-T-082 PRIME URBAN Monzen Nakacho

Koto, Tokyo

2,420

Rt-T-002

Yokosuka More’s City

Yokosuka, Kanagawa

13,640Rs-T-005 PROUD FLAT Gakugei Daigaku

Meguro, Tokyo746

Rs-T-083 PRIME URBAN Kameido

Koto, Tokyo

779

Rt-T-003

Recipe SHIMOKITA

Setagaya, Tokyo

10,407

Rs-T-006 PROUD FLAT Meguro Gyoninzaka

Meguro, Tokyo939

Rs-T-084 PRIME URBAN Sumiyoshi

Koto, Tokyo

632

Rt-T-004

Kawasaki More’s

Kawasaki, Kanagawa

6,080

Rs-T-007 PROUD FLAT Sumida Riverside

Chuo, Tokyo

2,280

Rs-T-085 PRIME URBAN Mukojima

Sumida, Tokyo

528

Rt-T-005

EQUINIA Shinjuku

Shinjuku, Tokyo

4,260

Rs-T-008 PROUD FLAT Kagurazaka

Shinjuku, Tokyo

1,590

Rs-T-086 PRIME URBAN Kinshi Koen

Sumida, Tokyo

1,290

Rt-T-006

EQUINA Ikebukuro

Toshima, Tokyo

3,990

Rs-T-009 PROUD FLAT Waseda

Shinjuku, Tokyo

1,110

Rs-T-087 PRIME URBAN Kinshicho

Sumida, Tokyo

758

Rt-T-007

covirna machida

Machida, Tokyo

3,440

Rs-T-010 PROUD FLAT Shinjuku Kawadacho

Shinjuku, Tokyo

947

Rs-T-088 PRIME URBAN Hirai

Edogawa, Tokyo

722

Rt-T-008

Nitori Makuhari

Chiba, Chiba

3,080

Rs-T-011 PROUD FLAT Sangen Jaya

Setagaya, Tokyo

1,190

Rs-T-089 PRIME URBAN Kasai

Edogawa, Tokyo

640

Rt-T-009

Konami Sports Club Fuchu

Fuchu, Tokyo

2,730

Rs-T-012 PROUD FLAT Kamata

Ota, Tokyo

1,160

Rs-T-090 PRIME URBAN Kasai II

Edogawa, Tokyo981

10 Nomura Real Estate Master Fund

604
1,110
180,850

OthersOt-T-001

Ryotokuji University Shin-Urayasu
Campus (Land)

Urayasu, Chiba

4,900

Subtotal (1 property)

4,900

Total (272 properties)

932,896

Nomura Real Estate Master Fund

11

PORTFOLIO GALLERY(As of the End of the 3rd Fiscal Period)
NMF Office Portfolio

Total Office Portfolio

NMF’s investment in office facilities centers on properties
developed by Nomura Real Estate Development, including thePremium Midsize Office (PMO) brand, with a focus on state-ofthe-art features to meet ever-changing tenant needs.

60

Total Acquisition Value for Portfolio¥448,654

properties

millionNMF Retail Portfolio

Total Retail Portfolio

NMF invests primarily in urban retail facilities that offer richvariety and enliven their surroundings, mainly through the
GEMS brand developed by Nomura Real Estate Development.

43

properties

Universal CityWalk Osaka
Shinjuku Nomura Building

NEC Head Office Building

Acquisition Price: ¥2,080 million

Location: Osaka, Osaka

Location: Chiyoda, Tokyo

Completion: June 2001

Completion: October 2014

Acquisition Price: ¥18,200 million

Location: Shinjuku, Tokyo

Location: Minato, Tokyo

Location: Chuo, Tokyo

Completion: May 1978

Completion: January 1990

Completion: October 2001

NRE Kichijoji Building

Omron Kyoto Center Building

12 Nomura Real Estate Master FundNMF Shibuya Koen-dori Building

PMO Nihonbashi Honcho

Secom Medical Building

million

GEMS Ichigaya

Acquisition Price: ¥15,500 million

Acquisition Price: ¥44,100 million

NRE Tennozu Building¥151,422

Harumi Island Triton Square Office Tower Y

Acquisition Price: ¥43,900 million

Kojimachi Millennium Garden

Total Acquisition Value for Portfolio

covirna machida

EQUINIA Shinjuku

PMO Tamachi

Nishi Shinjuku Showa Building

Morisia Tsudanuma

EQUINA Ikebukuro

Kawasaki More’s

Izumiya Yao

Sagamihara Shopping Center

Nomura Real Estate Master Fund

13

PORTFOLIO GALLERY(As of the End of the 3rd Fiscal Period)
NMF Logistics Portfolio

Total Logistics Portfolio

Centered on the Landport brand, NMF invests in logistics facilities with advanced functionality to meet the evolving needs ofdiverse tenants with an emphasis on optimization and efficiency.

21

Total Acquisition Value for Portfolio¥147,070

properties

Landport Kashiwa Shonan II

millionNMF Residential Portfolio
NMF invests in high-quality residential facilities in excellent
urban locations, chiefly the PROUD FLAT and PRIME URBAN
series developed by Nomura Real Estate Development.

Total Residential Portfolio

Total Acquisition Value for Portfolio

147¥180,850

properties

millionLandport Itabashi

Acquisition Price: ¥10,800 million

Acquisition Price: ¥15,710 million

Location: Kashiwa, Chiba

Location: Itabashi, Tokyo

Completion: April 2016

Completion: January 2008

Hirakata Kuzuha Logistics Center

Fukasawa House Towers H&I

PRIME URBAN Sapporo Riverfront

Acquisition Price: ¥7,140 million

Acquisition Price: ¥4,480 million

Location: Setagaya, Tokyo

Location: Sapporo, Hokkaido

Completion: June 2004

Completion: January 2008

Sagamihara Onodai
Logistics Center

Landport Urayasu

PROUD FLAT Tsurumi II

PROUD FLAT Sumida Riverside

PRIME URBAN Kawaguchi

PRIME URBAN Shibaura LOFTPROUD FLAT Shibuya Sakuragaoka

PRIME URBAN
Itabashi Honcho

Acquisition Price: ¥17,400 million
Location: Urayasu, Chiba
Completion: May 2008

Landport Kawagoe

14 Nomura Real Estate Master Fund

Kawaguchi Ryoke Logistics Center

Landport Kasukabe

Sagamihara Tana Logistics Center

Landport Atsugi

PRIME URBAN Karasuyama Court

Nomura Real Estate Master Fund

15

PORTFOLIO DIVERSIFICATIONSTRUCTURE AND ORGANIZATION(As of the End of the 3rd Fiscal Period)

Diversification is critical to the stability of a J-REIT and NMF achieved diversification through the factors
illustrated below.

Diversification by Area

Diversification by Use

Property quantity is also spread among various geographicalareas with 80% or more of the properties in the Tokyo area andabout 20% in three major metropolitan areas and government
designated cities.

The portfolio is also divided by use to provide further stability.

0.5%

Growth Model

Stability Model

17.2%

41.8%

Other Facilities

Residential0.5%
Facilities

Other Areas
Tokyo

82.8%
Tokyo

82.8%

41.8% Logistics
Facilities

OfficeBuildings

Residential
15.8
%

48.1%

Retail Facilities(in residential areas)
6.1%

19.4%
Logistics
Facilities

15.8%

OfficeBuildings

48.1%

25.4

Retail Facilities(near stations)
10.1%

Retail Facilities

Retail Facilities(near stations)
10.1%

19.4%
Ratio of Portfolio Comprised of Top Ten Tenants
19.4%

25.4%

Investment Corporation

Parent Company of theAsset Management Company
Nomura Real Estate Holdings, Inc.
Nomura Real Estate Development Co., Ltd.

Nomura Real Estate
Master Fund, Inc.

Nomura Real Estate
Asset Management Co., Ltd.

Custodian
Asset
Custody
Agreement

Information Provision
Agreement

Board of Directors*

Nomura Real Estate
Development Co., Ltd.
Nomura Real Estate Partners Co., Ltd.
GEO AKAMATSU CO., LTD.

Executive Director

Nomura Real Estate Development Co., Ltd.

Mitsubishi UFJ Trust andBanking Corporation

Unitholders’ Meeting

Leasing Value Chain

Basic Agreement Concerning“Leasing Value Chain”

Sumitomo Mitsui Trust Bank, Limited

General Administrator(Institutional Administration/
Accounting)Transfer Agent andSpecial Account Administrator

Asset
Management
Agreement

Information Provider

Diversification by Tenant

Ratio of Portfolio Comprised of Top Ten Properties
%

58.2%

Facilities(in residential areas)
6.1%

Diversification by Property

58.2%

Growth Model

Stability Model 19.4%

17.2%

Specified Related Party

Asset Management Company

Other Facilities

Other Areas

Structure of NMF

Transfer Agency Agreement
General Administration Agreement
Agreement Concerning Management of Special Account

Satoshi Yanagita
Supervisory Director
Sadahiko Yoshimura

General Administrator(Financial Agent)

Shuhei Yoshida
AuditorErnst & Young Shin Nihon LLC

Financial
Agent
Agreement

The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Sumitomo Mitsui Banking Corporation
Nomura Securities Co., Ltd.
Mizuho Securities Co., Ltd.

*At NMF’s first Unitholder’s Meeting, held May 26, 2017, Shuhei Yoshida was elected as executive director, and Mineo Uchiyama and Koichi Owada were elected as supervisory directors.
Each of these positions has a term of two years, beginning June 1, 2017.

Organization of NREAM
General Meeting of Shareholders
Investment Committee
Statutory Auditors

Board of Directors

Compliance Committee

President & CEO

Risk Management Committee
NPR Valuation Committee
Project Screening Committee

Strategic Property Replacement

Corporate Planning

NMF’s Strategic Property Replacement (SPR) calls for selling old and less competitive properties and acquiring newer andmore competitive properties, and for effective utilization of depreciation.

What is Strategic Property Replacement?

Chief Strategy Officer

International Business Planning

Product Development

Legal & Compliance

Research & Analysis

Internal Audit

Acquisitions

Finance & Accounting

Investment Management Planning

As of February 28, 2017

Old buildings with lesscompetitiveness and profitability

Nomura Real Estate Master FundSell

NMF Boasts a Large and Broadly
Diversified Portfolio

Reinvest money from sale

Acquired
Properties
Acquire young properties that arehighly competitive

AcquireTotal Acquisition
PricesLowering of average portfolio age
Reduction of maintenanceand repair fees
Effective use of depreciation…

272¥932.8 billion

Improvement in Portfolio
Quality

Client Relations & Marketing
Investment Management

NMF Investment Management Group
Fund Management
Asset Management I
Asset Management II
NPR Investment Management

16 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund

17

BALANCE SHEET
Thousands of Yen

As of February 28, 2017

Thousands of Yen

As of August 31, 2016

As of February 28, 2017

As of August 31, 2016

Trade accounts payable¥2,410,374¥2,562,468

Short-term debt

5,000,000—

Current portion of investment corporation bonds

9,000,000

10,000,000

Current portion of long-term debt

69,975,600

47,805,600

ASSETSLIABILITIESCurrent Assets:

Current Liabilities:

Cash and bank deposits
Rental receivables
Income taxes receivable
Consumption taxes receivable
Other current assets
Allowance for doubtful accounts
Total current assets¥73,331,039¥75,270,568

464,183

592,582—

1,423

147,670—

1,237,456

1,180,067—(54)

75,180,348

77,044,586

Lease obligations
Other accounts payable
Accrued expenses
Accrued income taxes

Property and Equipment:

Accrued consumption taxesLand

629,423,318

516,284,405

Rent received in advance

Buildings and structures

8,651

8,651

2,294,600

2,226,125

361,542

330,953

1,550

605

—

530,466

5,083,682

4,320,066
341,707309,299,034

270,808,636

Unearned revenue

366,627

Machinery and equipment

760,188698,335

Derivative liabilities

98,866

73,218Tools, furniture and fixtures

497,128

379,682

Other current liabilities

297,926

292,886

Leased assets

24,49524,49594,899,418

68,492,745

Construction in progress

22,180838,601

940,026,343

789,034,154(19,763,573)(15,010,664)

Investment corporation bonds

18,500,000

22,500,000

920,262,770

774,023,490

Long-term debt

396,308,400

329,466,200

SubtotalLess accumulated depreciation
Net property and equipment

Total current liabilities
Long-term Liabilities:

Lease obligations
Investments and Other Assets:

5,395

9,721

Long-term advanced received

713,191

671,420

Security deposits from tenants

37,892,970

33,331,213

Goodwill

98,698,194

74,305,825

Leasehold rights

8,581,094

8,492,841

Derivative liabilities

1,555,381

2,181,237

Intangible assets

36,86832,725

Total long-term liabilities

454,975,337

388,159,791

Total Liabilities

549,874,755

456,652,536

161,883,753

161,120,405

Long-term prepaid expenses

1,600,246

1,005,942

Long-term deposits

533,242

89,386

Security deposits

956,754

946,804

Derivatives Assets

108,612—Deferred investment corporation bond issuance costs

21,03922,411

110,536,049

84,895,934

Unitholders’ Equity:¥1,105,979,167¥935,964,010

Unitholders’ capital

Total investments and other assets
Total Assets
The accompanying notes to financial statements are an integral part of these statements.

NET ASSETS

SurplusCapital surplus

394,012,959

315,299,775

Allowance for temporary difference adjustments(5,374,246)(6,137,594)

Other deductions from capital surplus(3,800,508)(941,669)

Total deductions from capital surplus(9,174,754)(7,079,263)

Net capital surplus

384,838,205

308,220,512

Retained earnings

10,928,088

12,225,011

Total surplus

395,766,293

320,445,523

Total unitholders’ equity

557,650,046

481,565,928

Deferred gains or losses on hedges(1,545,634)(2,254,454)

Total valuation and translation adjustments(1,545,634)(2,254,454)

556,104,412

479,311,474¥1,105,979,167¥935,964,010

Valuation and Translation Adjustments:

Total Net Assets
Total Liabilities and Net Assets
The accompanying notes to financial statements are an integral part of these statements.

18 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund

19

STATEMENT OF INCOME AND
RETAINED EARNINGSSTATEMENT OF CHANGES IN
NET ASSETS
Thousands of Yen

For the period
from September 1, 2016
to February 28, 2017

For the period from September 1, 2016 to February 28, 2017
Thousands of Yen

For the period
from March 1, 2016
to August 31, 2016

Unitholders’ Equity
SurplusCapital surplus
Deductions from capital surplus
Allowance fortemporary
Other deductions Total deduction
difference
from capitalfrom capitaladjustment
surplussurplusOPERATING REVENUES AND EXPENSES
Operating Revenues:
Real estate rental revenues¥34,714,979¥29,532,380

Gain on sales of real estate—

1,442,275

Gain on investments in silent partnership

—

1,900

34,714,979

30,976,555

15,791,522

13,489,929

Operating Expenses:
Real estate rental expenses
Loss on sale of real estate
Impairment Loss
Asset management fees—

329,201

269,797—

2,783,115

2,565,116

Asset custody fees

48,74048,380Administrative service fees

155,545

147,697

Merger expenses

1,374,890

375,501

Amortization of goodwill

2,622,243

1,946,878

Other operating expenses
Operating Income

424,331

391,184

23,470,183

19,293,886

11,244,796

11,682,669

NON-OPERATING REVENUES AND EXPENSES
Non-Operating Revenues:
Interest income
Reversal of dividends payable

358

309

23,391

4,081

Interest on refund

2—

Other non-operating revenues

82

41

23,8334,431

1,886,021

1,714,123

279,333

284,082

1,372

1,372

423,783

324,256

Unitholders’CapitalUnits

Balance as of September 1, 2016
Increase by merger
Distributions of retained earnings
Reversal of allowance fortemporary difference adjustments
Other distributions in excess
of net earnings
Net income
Net changes of items otherthan unitholders’ equity
Balance as of February 28, 2017

3,722,010
461,120—

CapitalSurplus¥161,120,405 ¥315,299,775 (¥6,137,594)—
78,713,184————

Interest expenses on investment corporation bonds
Amortization of investment corporation bond issuance costs
Loan arrangement fees
Other non-operating expenses

5,560

6,681

2,596,069

2,330,514

Ordinary Income

8,672,560

9,356,586

Income before Income Taxes

8,672,560

9,356,586

763,348—

763,348(763,348)

—

—

—
—

—
—

—
—

—
—

(2,095,491)—(2,095,491)—(2,095,491)————¥161,883,753 ¥394,012,959 (¥5,374,246)—(¥3,800,508)——(¥9,174,754) ¥384,838,205—
4,183,130

Thousands of Yen

Retained earnings

Total surplus

Total unitholders’equityValuation and Translation
Adjustments
Deferred Gains
Total Valuationor Losses on
and Translation
HedgesAdjustments¥12,225,011—(9,204,530)¥320,445,523
78,713,184(9,204,530)¥481,565,928
78,713,184(9,204,530)(¥2,254,454)——(¥2,254,454)——¥479,311,474
78,713,184(9,204,530)(763,348)(763,348)

—

—

—

—

—
8,670,955(2,095,491)
8,670,955(2,095,491)
8,670,955

—
—

—
—

(2,095,491)
8,670,955—¥10,928,088—¥395,766,293—¥557,650,046

708,820(¥1,545,634)

708,820(¥1,545,634)

708,820¥556,104,412

Unitholders’ Equity
Surplus

Balance as of September 1, 2016
Increase by merger
Distributions of retained earnings
Reversal of allowance fortemporary difference adjustments
Other distributions in excess
of net earnings
Net income
Net changes of items otherthan unitholders’ equity
Balance as of February 28, 2017

For the period from March 1, 2016 to August 31, 2016
Thousands of Yen
Unitholders’ Equity
SurplusCapital surplus
Deductions from capital surplus
Allowance fortemporary
Other deductions Total deductions
difference
from other capitalfrom capitaladjustment
surplussurplus
Net capital surplus

Unitholders’CapitalUnits

Balance as of March 1, 2016
Distributions of retained earnings
Distributions in excess of
net earnings from allowance fortemporary difference adjustments
Other distributions in excess
of net earnings
Net income
Net changes of items otherthan unitholders’ equity
Balance as of August 31, 2016

3,722,010—

CapitalSurplus¥161,120,405 ¥315,299,775
—
—

—
—

—
—

—
—

¥315,299,775——(¥6,137,594)(6,137,594)——(941,669)—(941,669)—(941,669)————¥161,120,405 ¥315,299,775 (¥6,137,594)—(¥941,669)——— (¥6,137,594)

—
—

—
—

—
—

—
3,722,010——(¥7,079,263) ¥308,220,512
Thousands of Yen

1,605

605

1,605

605

Net Income

8,670,955

9,355,981

Retained earnings brought forward

2,257,133

2,869,030

Retained Earnings at End of Period¥10,928,088¥12,225,011

The accompanying notes to financial statements are an integral part of these statements.

Total
Net Assets

The accompanying notes to financial statements are an integral part of these statements.

Income Taxes:
Current

Net capital surplus(¥7,079,263) ¥308,220,512—
78,713,184———

Non-Operating Expenses:
Interest expense(¥941,669)——

Retained earnings

Total surplus

Total unitholders’equityValuation and Translation
Adjustments
Deferred Gains
Total Valuationor Losses on
and Translation
HedgesAdjustments¥ 4,048,907(1,179,877)¥319,348,682(1,179,877)¥480,469,087(1,179,877)(¥2,867,595)—(¥2,867,595)—¥477,601,492(1,179,877)—(6,137,594)(6,137,594)——(6,137,594)—
9,355,981(941,669)
9,355,981(941,669)
9,355,981

—
—

—
—

(941,669)
9,355,981—¥12,225,011—¥320,445,523—¥481,565,928

613,141(¥2,254,454)

613,141(¥2,254,454)

613,141¥479,311,474

Unitholders’ Equity
Surplus

Balance as of March 1, 2016
Distributions of retained earnings
Distributions in excess of
net earnings from allowance fortemporary difference adjustments
Other distributions in excess
of net earnings
Net income
Net changes of items otherthan unitholders’ equity
Balance as of August 31, 2016

Total
Net Assets

The accompanying notes to financial statements are an integral part of these statements.

20 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund

21

STATEMENT OF CASH FLOWSNOTES TO FINANCIAL STATEMENTS
Thousands of Yen

For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

CASH FLOWSCash Flows from Operating Activities
Income before income taxes
Depreciation
Impairment loss
Amortization of goodwill
Amortization of investment corporation bond issuance costs
Interest income
Interest expense
Loss on disposal of property and equipment
Increase (Decrease) in allowance for doubtful accounts
Decrease (Increase) in rental receivables
Decrease (Increase) in long-term prepaid expenses
Decrease (Increase) in long-term deposits
Increase (Decrease) in trade accounts payable
Increase (Decrease) in other accounts payable
Decrease (Increase) in consumption taxes receivables
Increase (Decrease) in accrued consumption taxes
Increase (Decrease) in accrued expenses
Increase (Decrease) in rent received in advance
Decrease in property and equipment due to sales
Decrease in property and equipment in trust due to sales
Other
SubtotalInterest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities¥8,672,560
4,757,916
269,797
2,622,243
1,372
(358)
2,165,354
5,259
(54)
176,868(227,234)
3,407(466,026)(106,694)(147,670)(698,979)(144,523)(599)——
272,228
17,154,867
358(2,383,092)
367
14,772,500¥9,356,586
4,207,239—
1,946,878
1,372
(309)
1,998,205
5,166—(157,025)(263,149)—
399,867
150,153—
389,764
15,792(74,218)
9,423,685
23,127,270(174,316)
50,352,960
309(2,187,967)(2,382)
48,162,920

Cash Flows from Investing Activities
Payments for purchases of property and equipment
Payments for purchases of leasehold rights and intangible assets
Proceeds from withdrawal of investment securities
Reimbursement of security deposits to tenants
Proceeds from security deposits from tenants
Proceeds from security deposits
Net cash provided by (used in) investing activities(13,686,180)(7,949)—(809,438)
895,27050(13,608,247)(28,773,290)(15,064)
86,592(2,582,461)
1,697,875
30,780(29,555,568)

5,000,000—
42,950,000(44,055,300)(5,000,000)(10,219,933)

6,000,000(15,100,000)
46,530,000(30,822,800)—(1,189,881)(1,782)(2,092,350)(13,419,365)(6,137,594)(941,669)(1,661,944)(12,255,112)
75,270,568
10,315,583¥73,331,039

16,945,408
58,325,160—¥75,270,568

Cash Flows from Financing Activities
Proceeds from short-term debt
Repayments of short-term debt
Proceeds from long-term debt
Repayment of long-term debt
Redemption of investment corporation bonds
Distributions to unitholders
Distributions in excess of net earnings from allowance fortemporary difference adjustments
Other distributions in excess of net earnings
Net cash provided by (used in) financing activities
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Period
Increase in Cash and Cash Equivalents Resulting from Merger
Cash and Cash Equivalents at End of Period

1. ORGANIZATION
Nomura Real Estate Master Fund, Inc. (NMF) is a real estate investment corporation formed to own and invest primarily in logistics facilities,
retail facilities, offices and residential facilities. The Company is externally managed by a licensed asset management company, Nomura Real
Estate Asset Management Co., Ltd. (“NREAM”). NREAM is a wholly-owned subsidiary of Nomura Real Estate Holdings, Inc. NMF wasestablished on October 1, 2015 through the consolidation type merger of the former Nomura Real Estate Master Fund, Inc. (hereinafter the“former NMF”), Nomura Real Estate Office Fund, Inc. (hereinafter “NOF”) and Nomura Real Estate Residential Fund, Inc. (hereinafter “NRF”),
and listed its investment securities (TSE code: 3462) on the Real Estate Investment Trust Section of the Tokyo Stock Exchange on October 2 thesame year.
NMF adopts the basic policy of investing primarily in real estate and other assets to secure stable income and steady growth of assets undermanagement over the medium to long term. In order to realize this basic policy, NMF adopts an investment strategy that centers on the Greater
Tokyo area (Tokyo, Kanagawa, Chiba and Saitama prefectures) which has strong tenant demand while also considering regional diversification
through the three major metropolitan areas and cabinet-order designated cities, etc. By combining the “diversified type strategy” in whichinvestments are made in facilities of a variety of sectors such as logistics facilities, retail facilities, offices and residential facilities with the“large-scale REIT strategy” which pursues the effects of diversifying properties and tenants to make the portfolio more stable as well as withthe utilization of the “leasing value chain” with the Nomura Real Estate Group, the sponsor, NMF will aim to increase unitholder value by
securing stable income and steady growth of assets under management over the medium to long term.

2. BASIS OF PRESENTATIONThe Company maintains its accounting records and prepares its financial statements in accordance with accounting principles generally acceptedin Japan (“Japanese GAAP”), including provisions set forth in the Investment Trust Act of Japan, the Companies Act of Japan, the Financial
Instruments and Exchange Act of Japan and related regulations, which are different in certain respects as to the application and disclosure
requirements of International Financial Reporting Standards.
The accompanying financial statements are a translation of the audited financial statements of the Company, which were prepared in accordancewith Japanese GAAP and were presented in the Securities Report of the Company filed with the Kanto Local Finance Bureau. In preparing theaccompanying financial statements, certain reclassifications and modifications have been made to the financial statements issued domesticallyin order to present them in a format that is more familiar to readers outside Japan. In addition, the notes to financial statements include certain
information that might not be required under Japanese GAAP but is presented herein as additional information. Amounts have been rounded to
the nearest thousand yen in the accompanying financial statements and the notes thereto, whereas amounts were truncated in the Japanesefinancial statements prepared in accordance with Japanese GAAP.
The Company’s fiscal period is a six-month period which ends at the end of February or August. The Company does not prepare consolidated
financial statements because it has no subsidiaries.

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESCash and cash equivalents
Cash and cash equivalents consist of cash on hand, deposits placed with banks and short-term investments that are highly liquid, readily
convertible to cash, with an insignificant risk of market value fluctuation, and with a maturity of three months or less when purchased.

Property and equipment
Property and equipment are stated at cost, which includes the purchase price and related costs for acquisition, less accumulated depreciation.
Depreciation is calculated by the straight-line method over the estimated useful lives of the fixed assets outlined below:
Buildings
Structures
Machinery and equipment
Tools, furniture and fixtures

3 - 70 years
2 - 45 years
2 - 10 years
2 - 20 years

Intangible assets
Intangible assets are amortized by the straight-line method.
Goodwill is amortized using straight-line method over 20 years.

Long-term prepaid expenses
Long-term prepaid expenses are amortized by the straight-line method.

The accompanying notes to financial statements are an integral part of these statements.

22 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund

23

Impairment of fixed assets
The Company reviews fixed assets for impairment whenever events or changes in circumstances indicate that the carrying value of its fixed
assets may not be recoverable. An impairment loss is recognized if the carrying value of an asset exceeds the aggregate estimated future cash
flows. If a fixed asset is determined to be impaired, it is written down to its recoverable amount and the write-down is recorded as an
impairment loss during the period in which it occurs.

Deferred investment corporation bond issuance costs
Deferred investment corporation bond issuance costs are amortized by the straight-line method over the respective terms of the bonds.

Important contents of the non-cash transactions
Below is a breakdown of the main components of the assets and liabilities transferred from TOP REIT, Inc., as a result of the merger with said
company in the period under review. The increase in capital surplus due to the merger was ¥78,713,184 thousand.
Thousands of Yen
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Current assets¥10,701,317—

Non-current assets

138,313,333—

Total assets¥149,014,650—

Allowance for doubtful accounts

Current liabilities¥43,815,959—

For allowance for doubtful accounts against possible losses arising from default on receivables, uncollectable amount is estimated and recorded
by investigating collectability based on historical loan loss ratios for general receivables and on a case-by-case examination for doubtful and otherspecific receivables.

Long-term liabilities

53,500,119—

Total liabilities¥97,316,078—

5. ASSETS PLEDGED AS COLLATERAL AND SECURED LIABILITIES

Accounting treatment of beneficial interests in real estate
All assets and liabilities held in trust, for which the real estate in possession of the Company was entrusted, and all related earnings andexpenses incurred are reflected in the accompanying balance sheet and statement of income and retained earnings, respectively.

Revenue recognition
Operating revenues consist of rental revenues including base rents and common area charges, and other operating revenues including utility
charge reimbursements, parking space rental revenues and other income. Rental revenues are generally recognized on an accrual basis over thelife of each lease. Utility charge reimbursements are recognized when earned and their amounts are reasonably estimated.

Property related taxes

The assets pledged as collateral are as follows:
Thousands of Yen
As of February 28, 2017

As of August 31, 2016

Buildings in trust¥3,335,340—

Land in trust

6,096,368

—

Total

¥9,431,708—

As of February 28, 2017

As of August 31, 2016

The secured liabilities are as follows:

Property in Japan is subject to property taxes, urban planning taxes and depreciable property taxes on a calendar year basis. The taxes related toproperty are generally imposed based on the value of the relevant property and incurred for fiscal period. The seller of a property is liable forproperty related taxes for the period from the purchase date through the end of that calendar year because taxes are imposed on the ownerregistered in the record as of January 1 for the entire year based on the assessment made by the local government. The amount applicable tothe buyer of a property is usually settled between each party and capitalized as part of the acquisition cost of the property. The capitalized
property related taxes amounted to ¥77,205 thousand for the fiscal period ended August 31, 2016,and ¥3,333 thousand for the fiscal period
ended February 28, 2017.

Thousands of Yen

Tenant leasehold and security deposits in trust
Total

Thousands of Yen
As of February 28, 2017

Consumption taxesLand¥193,986,143

Consumption taxes received and paid are not included in the accompanying statement of income and retained earnings.

Buildings and structures

112,734,556

Accumulated depreciation(4,897,682)

Derivative financial instruments

Machinery and equipment

The Company utilizes interest rate swap contracts as derivative financial instruments only for the purpose of hedging its exposure
to changes in interest rates. The Company defers recognition of gains or losses resulting from changes in the fair value of interest rate swap
contracts which meet the criteria for deferral hedge accounting.

Accumulated depreciation(172,580)

Tools, furniture and fixtures

109,031

Although the deferred hedge treatment is generally applied, the Company applies special treatment to those interest rate swap contracts thatmeet the criteria for such special treatment. Under the special treatment, interest rate swaps are not remeasured at fair value; instead, the net
amount paid or received under the interest rate swap contract is recognized and included in interest expense or income.

Accumulated depreciation

Thousands of Yen
As of August 31, 2016

¥73,331,039¥75,270,568¥73,331,039¥75,270,568

Acquisition costs

Book value¥185,217,460¥185,217,460

106,359,015
107,836,874

591,582(3,144,755)

103,214,260

569,898
419,002(109,416)

460,482

82,496(13,537)

95,494(5,002)77,494435,437,175

331,066,945

331,066,945

Buildings and structures in trust

196,564,478

Accumulated depreciation(14,585,392)

Tools, furniture and fixtures in trust

As of February 28, 2017

¥193,986,143

435,437,175

Accumulated depreciation

Cash and cash equivalents as of February 28, 2017 and August 31, 2016 consist of the following:

As of August 31, 2016

Land in trust

Machinery and equipment in trust

4. CASH AND CASH EQUIVALENTS

Accumulated depreciation
Lease assets in trust
Accumulated depreciation
Construction in progress
Total

24 Nomura Real Estate Master Fund—

6. SCHEDULE OF PROPERTY AND EQUIPMENT

Deferred tax assets and liabilities are computed based on the differences between the financial statements and income tax bases of assets andliabilities using the applicable statutory tax rates.

Cash and cash equivalents—¥726,648

Property and equipment as of February 28, 2017 and August 31, 2016 consist of the following:

Income taxes

Cash and bank deposits¥726,648

164,449,621
181,979,086

168,606(14,366)

152,750,730

128,437
154,240

388,097(68,629)(11,698,891)(7,150)121,287

297,186
319,468

24,495(38,082)259,104

24,495(11,387)

13,108(7,368)17,12722,18022,180838,601

838,601¥920,262,770¥920,262,770¥774,023,490¥774,023,490

Nomura Real Estate Master Fund25

7. SHORT-TERM DEBT AND CURRENT PORTION OF LONG-TERM DEBT

8. LONG-TERM DEBT

Short-term debt and current portion of long-term debt as of February 28, 2017 and August 31, 2016 consist of the following:

Long-term debt as of February 28, 2017 and August 31, 2016 consist of the following:

As of February 28, 2017

Unsecured loans from banks due on February 23, 2018

As of August 31, 2016

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

Amount(Thousands of Yen)

As of February 28, 2017
Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

As of August 31, 2016

Weighted-averageinterest rate (Note 1)

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)¥5,000,000

0.58205%——

Unsecured loans from banks due on September 26, 2017——

¥4,000,000

0.15182%

Unsecured loans from a bank due on November 26, 2016——

¥13,000,000

0.64250%

Unsecured loans from a bank due on December 26, 2017——12,900,000

1.03775%

Unsecured loans from a bank due on February 26, 2017——

1,000,000

1.07450%

Unsecured loans from banks due on February 26, 2018——

1,000,000

1.84650%

Unsecured loans from a bank due on February 26, 2017——

2,000,000

0.88700%

Unsecured loans from banks due on February 26, 2018——

1,500,000

0.44000%

Unsecured loans from a bank due on February 26, 2017——

1,800,000

0.69000%

Unsecured loans from banks due on February 27, 2018——

5,420,000

1.12013%

Unsecured loans from a bank due on February 26, 2017 (Note 2)——

1,000,000

0.45182%

Unsecured loans from banks due on March 27, 2018

¥4,670,000

0.63000%——

Unsecured loans from banks due on March 11, 2017 (Note 3)

4,000,000

0.33606%

4,000,000

0.35182%

Unsecured loans from a bank due on March 27, 2018

2,355,000

1.08448%——

Unsecured loans from a bank due on March 26, 2017

1,000,000

0.21000%

1,000,000

0.21182%

Unsecured loans from banks due on April 30, 2018

1,230,000

0.63000%——

Unsecured loans from banks due on June 10, 2017

3,900,000

1.43500%

3,900,000

1.43500%

Unsecured loans from a bank due on May 26, 201812,200,000

0.86250%

12,200,000

0.86250%

Unsecured loans from banks due on June 30, 2017

17,500,000

Note 6——

Unsecured loans from banks due on June 26, 2018

2,000,000

1.09000%

2,000,000

1.09000%

Unsecured loans from a bank due on August 26, 2017

750,000

0.43727%750,000

0.44000%

Unsecured loans from banks due on August 26, 2018

2,000,000

1.03500%

2,000,000

1.03500%

Unsecured loans from banks due on August 26, 2017

5,000,000

0.21000%

5,000,000

0.21182%

Unsecured loans from a bank due on August 26, 2018

5,400,000

0.99000%

5,400,000

0.99000%

Unsecured loans from banks due on August 27, 2017

9,000,000

1.12850%

9,000,000

1.12850%

Unsecured loans from a bank due on November 26, 2018

2,000,000

0.93600%

2,000,000

0.93600%

Unsecured loans from banks due on August 27, 2017

3,920,000

1.08500%

3,920,000

1.08500%

Unsecured loans from a bank due on November 26, 2018

4,000,000

0.72500%

4,000,000

0.72500%

Unsecured loans from banks due on September 26, 2017

4,000,000

0.15000%——

Unsecured loans from a bank due on November 26, 2018

3,000,000

0.77650%

3,000,000

0.77650%

Unsecured loans from banks due on December 26, 201712,900,000

1.03775%——

Unsecured loans from banks due on November 26, 2018

1,000,000

0.48250%

1,000,000

0.48250%

Unsecured loans from a bank due on February 26, 2018

1,000,000

1.84650%——

Unsecured loans from banks due on November 26, 2018

1,700,000

0.50250%

1,700,000

0.50250%

Unsecured loans from banks due on February 26, 2018

1,500,000

0.43727%——

Unsecured loans from a bank due on February 26, 2019

3,000,000

1.44450%

3,000,000

1.44450%

Unsecured loans from banks due on February 27, 2018

5,420,000

1.12013%——

Unsecured loans from a bank due on February 26, 2019

2,000,000

0.90759%

2,000,000

0.90759%——

1,350,000

2.03000%

Unsecured loans from a bank due on February 26, 2019

5,300,000

0.87695%

5,300,000

0.87695%

Unsecured loans from a bank due on May 26, 2025 (Note 5)

42,8002.17000%

42,8002.17000%

Unsecured loans from banks due on March 29, 2019

4,500,000

0.81625%——

Unsecured loans from a bank due on May 26, 2025 (Note 5)

42,8002.21812%42,8002.21812%

Unsecured loans from banks due on March 29, 2019

4,000,000

0.89635%——

Unsecured loans from a bank due on May 26, 2019

9,000,000

1.11750%

9,000,000

1.11750%

Unsecured loans from a bank due on May 26, 2019

1,000,000

1.04875%

1,000,000

1.04875%

Unsecured loans from a bank due on May 26, 2019

1,100,000

0.69894%

1,100,000

0.69894%

Unsecured loans from a bank due on August 26, 2019

2,200,000

1.22000%

2,200,000

1.22000%

Unsecured loans from a bank due on August 26, 2019

5,700,000

1.25200%

5,700,000

1.25200%

Unsecured loans from a bank due on August 26, 20192,500,000

1.27625%2,500,000

1.27625%

Unsecured loans from a bank due on August 26, 2019

4,700,000

0.81080%

4,700,000

0.81080%

Unsecured loans from banks due on October 26, 2019

3,000,000

0.20000%——

Unsecured loans from a bank due on November 26, 20191,600,000

1.16500%

1,600,000

1.16500%

Unsecured loans from a bank due on November 26, 2019

4,000,000

0.72650%

4,000,000

0.72650%

Unsecured loans from a bank due on November 26, 20195,600,000

0.54065%

5,600,000

0.54065%

Unsecured loans from a bank due on November 26, 2019

3,450,000

0.37420%

3,450,000

0.37420%

Unsecured loans from a bank due on February 26, 2020

5,750,000

1.01150%

5,750,000

1.01150%

Unsecured loans from a bank due on February 26, 2020

2,500,000

0.64685%

2,500,000

0.64685%

Unsecured loans from a bank due on May 26, 2020

10,000,000

1.33750%

10,000,000

1.33750%

Unsecured loans from a bank due on May 26, 2020

800,000

1.25875%

800,000

1.25875%

Unsecured loans from a bank due on May 27, 2020

1,000,000

1.48625%

1,000,000

1.48625%

Unsecured loans from banks due on May 29, 2020

4,000,000

0.43000%——

Unsecured loans from a bank due on August 26, 2020

1,100,000

1.53674%

1,100,000

1.53674%

Unsecured loans from a bank due on August 26, 2020

800,000

1.28277%

800,000

1.28277%

Unsecured loans from a bank due on August 26, 2020

4,700,000

1.18000%

4,700,000

1.18000%

Unsecured loans from a bank due on August 26, 2020

500,000

1.15566%

500,000

1.15566%

Unsecured loans from a bank due on August 26, 2020

4,500,000

1.08100%

4,500,000

1.08100%

Unsecured loans from a bank due on August 26, 2020

1,000,000

0.72000%

1,000,000

0.72000%

Unsecured loans from a bank due on November 26, 2020

3,500,000

0.46075%

3,500,000

0.46075%

Unsecured loans from a bank due on November 26, 2020

2,350,000

0.46190%

2,350,000

0.46190%

Unsecured loans from a bank due on November 26, 2020

500,000

0.47375%

500,000

0.47375%

Unsecured loans from a bank due on February 26, 2021

5,000,000

1.35250%

5,000,000

1.35250%

Unsecured loans from a bank due on February 26, 2021

2,000,000

1.17750%

2,000,000

1.17750%

Unsecured loans from a bank due on February 26, 2021

2,000,000

1.19211%2,000,000

1.19211%

Unsecured loans from a bank due on February 26, 2016 (Note 4)

Total¥74,975,600¥47,805,600

Note 1: The weighted-average interest rate is weighted by the balance of each borrowing at the end of the period and rounded to the nearest fifth decimal place. As forthe borrowings, which were hedged by interest-rate swaps for the purpose of avoiding interest rate fluctuation risk, the swapped interest rates are used to
calculate the weighted average of interest.
Note 2: The borrowing was ¥3,500 million repaid on May 26,2016 in advance to the maturity date.
Note 3: The borrowing was ¥1,000 million repaid on May 26,2016 in advance to the maturity date.
Note 4: The amount of ¥50 million every Date of Repayment from August 26, 2010 to August 26, 2016, and ¥1,350 million on February 26, 2017, the last Date of Repayment.
Note 5: Repay ¥10.7 million of principal at each repayment date during the period between August 26, 2013, and February 26, 2025, and repay ¥497.1 million on May 26,
2025, the last repayment date.
Note 6: Based on an agreement, of the ¥17,500 million, the weighted average interest rates were 0.51000% applicable to ¥9,000 million and 0.79450% applicable to theremaining ¥8,500 million in consideration of the effect of interest rate swaps used for the purpose of avoiding interest rate fluctuation risk.

(1) The Company entered into ¥10,000 million credit facilities in the form of commitment lines with two financial institutions for the fiscal
period ended February 28, 2017. The total unused amounts of such credit facilities were ¥10,000 million as of February 28, 2017.
(2) The Company entered into ¥40,000 million credit facilities in the form of commitment lines with five financial institutions for the fiscal
period ended February 28, 2017. The total unused amounts of such credit facilities were ¥35,000 million as of February 28, 2017.
(3) The Company entered into ¥10,000 million credit facilities in the form of commitment lines with two financial institutions for the
fiscal period ended August 31, 2016. The total unused amounts of such credit facilities were ¥10,000 million as of August 31, 2016.
(4) The Company entered into ¥40,000 million credit facilities in the form of commitment lines with five financial institutions for the fiscal
period ended August 31, 2016. The total unused amounts of such credit facilities were ¥40,000 million as of August 31, 2016.

26 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund27

As of February 28, 2017

As of August 31, 2016

As of February 28, 2017

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

Unsecured loans from a bank due on February 26, 2021

¥2,000,000

0.80832%¥2,000,000

0.80832%

Unsecured loans from a bank due on February 26, 2021

3,000,000

0.86350%

3,000,000

0.86350%

Unsecured loans from a bank due on February 26, 2021

2,120,000

0.85050%

2,120,000

Unsecured loans from a bank due on February 26, 2021

500,000

0.46725%

Unsecured loans from a bank due on February 26, 2021

2,000,000

0.22560%

Unsecured loans from banks due on February 26, 2021

2,800,000

0.14700%

Unsecured loans from a bank due on February 26, 2021

As of August 31, 2016

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

Amount(Thousands of Yen)

Weighted-averageinterest rate (Note 1)

Unsecured loans from a bank due on February 26, 2024

¥2,750,000

1.59400%¥2,750,000

1.59400%

Unsecured loans from banks due on February 26, 2024

1,300,000

0.53630%——0.85050%

Unsecured loans from banks due on May 26, 2024

1,100,000

0.51000%

1,100,000

0.51000%

500,000

0.46725%

Unsecured loans from a bank due on May 26, 2024

2,700,000

0.46376%

2,700,000

0.46376%

2,000,000

0.22560%

Unsecured loans from a bank due on May 26, 2024

2,000,000

0.53676%

—

—

—

—

Unsecured loans from a bank due on June 26, 2024

2,700,000

0.85925%2,700,000

0.85925%

400,000

0.21810%400,000

0.21810%

Unsecured loans from a bank due on June 26, 2024

2,700,000

0.49533%

2,700,000

0.49533%

Unsecured loans from a bank due on May 26, 2021

8,000,000

1.56250%

8,000,000

1.56250%

Unsecured loans from a bank due on August 26, 2024

3,000,000

0.58175%

3,000,000

0.58175%

Unsecured loans from a bank due on May 26, 2021

1,000,000

1.46375%

1,000,000

1.46375%

Unsecured loans from a bank due on August 26, 2024

2,430,000

0.49971%2,430,000

0.49971%

Unsecured loans from a bank due on May 27, 2021

1,000,000

1.68200%

1,000,000

1.68200%

Unsecured loans from a bank due on November 26, 2024

2,250,000

0.50825%

2,250,000

0.50825%

Unsecured loans from a bank due on May 27, 2021

3,500,000

1.62500%

3,500,000

1.62500%

Unsecured loans from banks due on November 26, 2024

3,000,000

0.58000%——

Unsecured loans from a bank due on July 26, 2021

4,180,000

1.23920%

4,180,000

1.23920%

Unsecured loans from a bank due on November 26, 2024

1,800,000

0.55979%——

Unsecured loans from a bank due on August 26, 2021

2,700,000

1.24100%

2,700,000

1.24100%

Unsecured loans from banks due on February 26, 2025

4,200,000

0.62675%¥4,200,000

0.62675%

Unsecured loans from a bank due on August 26, 2021

3,600,000

0.81585%

3,600,000

0.81585%

Unsecured loans from a bank due on February 26, 2025

1,000,000

0.52140%

1,000,000

0.52140%

Unsecured loans from a bank due on November 26, 2021

2,000,000

1.30289%2,000,000

1.30289%

Unsecured loans from a bank due on May 26, 2025

2,000,000

0.60286%——

Unsecured loans from a bank due on November 26, 2021

2,000,000

1.11662%2,000,000

1.11662%

Unsecured loans from a bank due on May 26, 2025

2,000,000

0.60286%——

Unsecured loans from a bank due on November 26, 2021

4,900,000

0.97410%4,900,000

0.97410%

Unsecured loans from banks due on May 26, 2025

2,800,000

0.60286%——

Unsecured loans from a bank due on January 26, 2022

3,500,000

1.48300%

3,500,000

1.48300%

Unsecured loans from banks due on August 26, 2025

3,000,000

0.56380%

3,000,000

0.56380%

Unsecured loans from a bank due on February 26, 2022

4,500,000

1.31850%

4,500,000

1.31850%

Unsecured loans from banks due on August 26, 2025

4,050,000

0.58727%

4,050,000

0.58727%

Unsecured loans from a bank due on February 26, 2022

2,750,000

1.29600%

2,750,000

1.29600%

Unsecured loans from banks due on August 26, 2025

1,850,000

0.67915%——

Unsecured loans from a bank due on February 26, 2022

4,000,000

1.16000%

4,000,000

1.16000%

Unsecured loans from a bank due on November 26, 2025

1,100,000

1.09830%

1,100,000

1.09830%

Unsecured loans from a bank due on May 26, 2022

5,500,000

1.25900%

5,500,000

1.25900%

Unsecured loans from a bank due on November 26, 2025

1,100,000

1.06250%

1,100,000

1.06250%

Unsecured loans from banks due on May 31, 2022

4,500,000

0.82500%——

Unsecured loans from a bank due on November 26, 2025

2,000,000

1.03955%

2,000,000

1.03955%

Unsecured loans from a bank due on August 26, 2022

2,980,000

1.19700%

2,980,000

1.19700%

Unsecured loans from a bank due on November 26, 2025

2,000,000

0.59639%2,000,000

0.59639%

Unsecured loans from a bank due on August 26, 2022

3,000,000

1.09133%

3,000,000

1.09133%

Unsecured loans from a bank due on November 26, 2025

2,000,000

0.60448%2,000,000

0.60448%

Unsecured loans from a bank due on August 26, 2022

4,000,000

1.08034%

4,000,000

1.08034%

Unsecured loans from banks due on November 26, 2025

4,200,000

0.64616%——

Unsecured loans from a bank due on August 26, 2022

1,000,000

0.32886%

1,000,000

0.32886%

Unsecured loans from banks due on February 26, 2026

4,000,000

0.74080%

4,000,000

0.74080%

Unsecured loans from banks due on September 30, 2022

4,000,000

0.76250%——

Unsecured loans from a bank due on May 26, 2026

2,500,000

0.63995%

2,500,000

0.63995%

Unsecured loans from a bank due on November 26, 2022

2,100,000

0.92280%

2,100,000

0.92280%

Unsecured loans from a bank due on August 26, 2026

2,700,000

0.67591%2,700,000

0.67591%

Unsecured loans from a bank due on November 26, 2022

1,800,000

1.05000%

1,800,000

1.05000%

Unsecured loans from a bank due on August 26, 2026

2,700,000

0.67591%2,700,000

0.67591%

Unsecured loans from a bank due on November 26, 2022

4,550,000

1.11000%

4,550,000

1.11000%

Unsecured loans from banks due on August 26, 2026

3,000,000

0.77669%——

Unsecured loans from a bank due on November 26, 2022

1,500,000

0.98624%

1,500,000

0.98624%

Unsecured loans from a bank due on November 26, 2026

2,000,000

0.76000%——

Unsecured loans from a bank due on November 26, 2022

1,000,000

0.71221%1,000,000

0.71221%

Unsecured loans from a bank due on November 26, 2027

2,000,000

0.89209%——

Unsecured loans from a bank due on November 26, 2022

1,500,000

0.69250%

1,500,000

0.69250%

Unsecured loans from a bank due on November 26, 2029

2,000,000

1.12506%——

Unsecured loans from a bank due on February 26, 2023

1,300,000

1.13250%

1,300,000

1.13250%

Unsecured loans from a bank due on November 26, 2029

2,000,000

1.12506%——

Unsecured loans from banks due on February 26, 2023

2,800,000

0.40740%2,800,000

0.40740%

Unsecured loans from a bank due on October 26, 2030

1,100,000

1.92250%

1,100,000

1.92250%

Unsecured loans from banks due on February 28, 2023

10,000,000

0.48700%——

Unsecured loans from a bank due on October 26, 2030

1,100,000

1.91700%

1,100,000

1.91700%

Unsecured loans from a bank due on May 26, 2023

2,000,000

1.86500%

2,000,000

1.86500%

Unsecured loans from a bank due on May 26, 2025 (Note 2)

796,700

2.17000%

818,100

2.17000%

Unsecured loans from a bank due on May 26, 2023

2,000,000

1.89500%

2,000,000

1.89500%

Unsecured loans from a bank due on May 26, 2025 (Note 2)

796,700

2.21812%818,100

2.21812%

Unsecured loans from a bank due on May 26, 2023

1,000,000

1.83875%

1,000,000

1.83875%

Unsecured loans from a bank due on May 26, 2023

1,000,000

0.41250%

1,000,000

0.41250%

Unsecured loans from a bank due on May 26, 2023

2,500,000

0.43408%——

Unsecured loans from a bank due on August 26, 2023

1,000,000

1.14850%

1,000,000

1.14850%

Unsecured loans from a bank due on August 26, 2023

1,000,000

1.15850%

1,000,000

1.15850%

Unsecured loans from a bank due on August 26, 2023

1,000,000

1.18032%

1,000,000

1.18032%

Unsecured loans from a bank due on August 26, 2023

4,000,000

1.20772%

4,000,000

1.20772%

Unsecured loans from a bank due on August 26, 2023

6,100,000

1.08510%

6,100,000

1.08510%

Unsecured loans from a bank due on August 26, 2023

1,000,000

0.43466%

1,000,000

0.43466%

Unsecured loans from a bank due on August 26, 2023

1,000,000

0.41000%

1,000,000

0.41000%

Unsecured loans from banks due on August 31, 2023

6,700,000

0.55700%——

Unsecured loans from a bank due on November 26, 2023

2,000,000

1.75900%

2,000,000

1.75900%

Unsecured loans from a bank due on November 26, 2023

2,600,000

0.82800%

2,600,000

0.82800%

Unsecured loans from banks due on November 26, 2023

4,000,000

0.49380%——

Unsecured loans from banks due on November 26, 2023

1,500,000

0.47483%——

28 Nomura Real Estate Master Fund

Total

¥396,308,400¥329,466,200

Note 1: The weighted-average interest rate is weighted by the balance of each borrowing at the end of the period and rounded to the nearest fifth decimal place. As forthe borrowings, which were hedged by interest rate swaps for the purpose of avoiding interest rate fluctuation risk, the swapped interest rates are used to
calculate the weighted average of interest.
Note 2: Installments of ¥10.7 million will be made on the 26th day of every third month starting on August 26, 2013, with the remaining payment of ¥497.1 million to be
repaid on May 26, 2025.

The scheduled repayment amounts of long-term debt for each of the five years after the balance sheet date (excluding the current
portion of long-term debt) are as follows.
Thousands of Yen
1-2 years

2-3 years

3-4 years

4-5 years

As of August 31, 2016

¥46,505,600¥48,285,600¥47,385,600¥49,435,600

As of February 28, 2017

¥51,940,600¥60,685,600¥56,655,600¥47,715,600

Nomura Real Estate Master Fund29

9. INVESTMENT CORPORATION BONDS

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses

Details of investment corporation bonds outstanding are summarized as follows.
As of February 28, 2017
Amount(Thousands of Yen)

NOF’s 2nd series of unsecured investment corporation bonds
due on March 16, 2020

As of August 31, 2016

Interest rate (Note)

Amount(Thousands of Yen)

Interest rate (Note)¥5,000,000

2.47%¥5,000,000

NOF’s 6th series of unsecured investment corporation bonds
due on March 17, 2017

5,000,000

2.21%

NOF’s 7th series of unsecured investment corporation bonds
due on March 17, 2028

4,500,000

NOF’s 9th series of unsecured investment corporation bonds
due on November 24, 2017
NRF’s 2nd series of unsecured investment corporation bonds
due on February 24, 2017

Method of reversal

Upon depreciation and sale, etc, the corresponding amount is scheduled to be reversed.

2.47%

Land

Upon sale, etc, the corresponding amount is scheduled to be reversed.

Buildings in trust,etc.

Upon depreciation or sale, etc, the corresponding amount is scheduled to be reversed.

5,000,000

2.21%

Upon sale, etc, the corresponding amount is scheduled to be reversed.

2.9%

4,500,000

2.9%Land in trust
Leasehold rights
Leasehold rights in trust
Investment securities

Upon redemption, etc., the corresponding amount is scheduled to be reversed.

4,000,000

1.52%

4,000,000

1.52%

—

—

5,000,000

1.03%

Former NMF’s 1st series of unsecured investment
corporation bonds due on October 30, 2024

3,000,000

0.87%

3,000,000

0.87%

NOF’s 10th series of unsecured investment corporation
bonds due on November 25, 2024

6,000,000

1.02%

6,000,000

1.02%

Total

Item

Buildings, etc.

¥27,500,000(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges.
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount is scheduled to be reversed.
For the period from March 1, 2016 to August 31, 2016
1. Reason, related assets and amounts¥32,500,000

Thousands of Yen

Note: The interest rate is rounded to the nearest fifth decimal place.

InitialamountBalance at theend of previous
periodAllowance
set aside
duringperiodAmortization of goodwill¥1,622,398—¥1,622,398—¥1,622,398—

The scheduled redemption amounts of investment corporation bonds for each of the five years after the balance sheet date are as follows.
Thousands of Yen

As of August 31, 2016

Within a year

1-2 years

2-3 years

3-4 years¥10,000,000¥4,000,000—¥5,000,000

4-5 years

—

—

—

—

¥5,000,000—

Related assets, etc.

Goodwill

Reason

ReversalduringperiodBalance at theend of current
periodReason forreversalLand, buildings, etc.

Merger expenses

2,638,862—

1,568,581—

1,568,581—

Land, buildings, etc.

Impairment loss

79,020—79,020—79,020—

10. UNITHOLDERS’ EQUITY

Deferred gains orlosses on hedges

The Company issues only non-par value investment units in accordance with the Investment Trust Act. The entire amount of the issue price of new units
is designated as stated capital. The Company is required to maintain net assets of at least ¥50,000 thousand as set forth in the Investment Trust Act.

Loss on interest rate swaps
recognized at the end of
the fiscal period

Increase - subtotal

As of February 28, 2017

Buildings, building
improvements, etc.

Depreciation deficiency
equivalent

2,867,595—

2,867,595—

2,867,595—

7,207,875—

6,137,594—

6,137,594—(790,132)

—

—

—

—

—

The movement in the allowance for temporary difference adjustments on the Balance Sheet was as follows:

Investment corporation bonds
Investment corporation
issuance cost amortizationbond issuance costs
deficiency equivalent(97,558)

—

—

—

—

—

For the period from September 1, 2016 to February 28, 2017

Write-down of loss on interest
Unearned revenue, etc.
rate swap due to merger(172,304)

—

—

—

—

—

1. Reason, related assets and amounts

Other(10,287)

—

—

—

—

—

11. ALLOWANCE FOR TEMPORARY DIFFERENCE ADJUSTMENTS

Thousands of Yen

Related assets, etc.

ReasonGoodwill

Amortization of goodwill

Land, buildings, etc.

Merger expenses

Land, buildings, etc.

Impairment loss

Deferred gains orlosses on hedges

Loss on interest-rate swaps
recognized at the end of the
fiscal period

InitialamountBalance at theend of previous
periodIncreaseduringperiod¥1,622,398¥1,622,398—

2,638,862

79,0201,568,581

79,020——

Reversalduringperiod—Balance at theend of current
periodReason forreversal¥1,622,398—(¥71,187)

Sale of property
and amortization of
1,497,394 merger expenses(79,020)

Sale of property on
which impairment— was recognized

2,867,595

2,867,595—(613,141)

Changes in fairvalue of derivative
2,254,454
transactions

7,207,875

6,137,594—(763,348)

5,374,246—(790,132)

—

—

—

—

—

Investment corporation bonds
Investment corporation
issuance cost amortizationbond issuance costs
deficiency equivalent(97,558)

—

—

—

—

—

Unearned revenue,etc.

Write-down of loss on interest
rate swap due to merger(172,304)

—

—

—

—

—

Other

—

(10,287)

—

—

—

—

—

Decrease - subtotal(1,070,281)

—

—

—

—

—

Total

¥6,137,594¥6,137,594—(¥763,348)¥5,374,246—

Increase - subtotal
Buildings, building
improvements, etc.

Depreciation deficiency
equivalent

30 Nomura Real Estate Master Fund—

Decrease - subtotal(1,070,281)

—

—

—

—

—

Total

¥6,137,594—¥6,137,594—¥6,137,594—

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation and sale, etc, the corresponding amount is scheduled to be reversed.

Land

Upon sale, etc, the corresponding amount is scheduled to be reversed.

Buildings in trust,etc.

Upon depreciation or sale, etc, the corresponding amount is scheduled to be reversed.

Land in trust
Leasehold rights
Leasehold rights in trust

Upon sale, etc, the corresponding amount is scheduled to be reversed.

Investment securities

Upon redemption, etc., the corresponding amount is scheduled to be reversed.

(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges.
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount is scheduled to be reversed.

Nomura Real Estate Master Fund3112. PER UNIT INFORMATION

The following summarizes the significant differences between the statutory tax rate and the effective tax rate.
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Statutory tax rate

31.74%

32.31%

Deductible cash distributions(41.62%)(8.61%)

Valuation of allowance

0.30%(30.43%)

Amortization of goodwill

9.60%

6.72%

Other

0.01%

0.01%

Effective tax rate

0.02%

0.01%

The net asset values per unit and the net income per unit as of February 28, 2017 and August 31, 2016 were as follows:
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Net assets per unit

¥132,939¥128,777

Net income per unit

¥2,072¥2,513Note 1: The net income per unit is calculated by dividing net income by the weighted-average number of units outstanding.
Note 2: The basis for calculating net income per unit is as follows.

Net income (Thousands of Yen)

For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

¥8,670,955¥9,355,981

Amount not available to ordinary unitholders (Thousands of Yen)——

Net income available to ordinary unitholders (Thousands of Yen)

¥8,670,955¥9,355,981

Average number of units during the period (Units)

4,183,130

3,722,010

13. RELATED PARTY TRANSACTIONS

15. FINANCIAL INSTRUMENTS
Overview
1. Policy for Financial Instruments
Upon acquisition of property-related assets, the Company may raise funds through certain financing methods including borrowings, issuanceof investment corporation bonds and issuance of investment units. In financing through interest-bearing debt, to secure stable financing
capability and reduce future risks of rising interest rates, the Company’s investment policy is to secure longer-term, fixed-rate borrowings withwell-diversified maturities.
The Company enters into derivative transactions only for the purpose of reducing risk of future interest rate fluctuations and does not engage
in speculative transactions.

For the periods from September 1, 2016 to February 28, 2017 and from March 1, 2016 to August 31, 2016
Parent Company and major corporate unitholders
Not applicable
Subsidiaries and affiliates
Not applicable
Fellow subsidiary companies
Not applicable
Directors and major individual unitholders
Not applicable

2. Type and Risk of Financial Instruments and Related Risk Management
Debts and investment corporation bonds are primarily used to fund the acquisition of property-related assets as well as the repayment ofdebts and redemption of investment corporation bonds. The Company is exposed to liquidity risk of being unable to meet its obligations onscheduled due dates. The Company controls and limits such risk by diversifying not only the financial institutions, but also the type offinancing to include the effective use of surplus funds and direct financing from the capital markets such as issuance of investment units. In
addition, the Company is exposed to the market risk arising from fluctuations in interest rates on its floating-rate debts. However, the effect ofsuch risk on the operation of the Company is limited by maintaining the LTV ratio at low levels and the ratio of long-term fixed-rate debts tototal debt at high levels. Furthermore, the Company may utilize derivative transactions (interest rate swap transactions) as a hedging instrument
to reduce the market risk under floating-rate debts by swapping such floating-rate interest payments for fixed-rate interest payments.

14. INCOME TAXESThe Company, as an investment corporation, is subject to corporate income taxes at a statutory tax rate of approximately 31.74% for the fiscal
period ended February 28, 2017. However, the Company may deduct dividend distributions paid to its unitholders from its taxable income
amounts, provided such distributions meet the requirements under the Act on Special Measures Concerning Taxation of Japan. Under this act,
an investment corporation must meet a number of tax requirements, including a requirement to distribute in excess of 90% of its distributable
income for the fiscal period, in order to deduct such amounts. If the investment corporation does not satisfy all of the requirements, the entire
taxable income of the investment corporation will be subject to regular corporate income taxes.
Since the Company distributed in excess of 90% of its distributable income in the form of cash distributions totaling ¥11,266,518 thousand forthe fiscal period ended February 28, 2017 respectively, such distributions were treated as deductible distributions for purposes of corporate
income taxes.
The following summarizes breakdown of deferred tax assets and liabilities:

Bank deposits are held as a means of investing surplus funds, and the Company is exposed to the credit risk that financial institutions may
default. However, the effect of such risk is limited by diversifying the financial institutions with which surplus funds are deposited.
3. Supplementary Explanation on Estimated Fair Value of Financial Instruments
The fair value of financial instruments is based on the quoted market price, if applicable. When there is no quoted market price available, fairvalue is reasonably estimated. Certain assumptions are used for the estimation of fair value. Accordingly, the result of such estimation may
change if different assumptions are used. Furthermore, the contractual amounts of derivative transactions stated in “19. Derivatives andHedge Accounting” below do not represent the market risk involved in these derivative transactions.

Fair Value of Financial Instruments
For the period from September 1, 2016 to February 28, 2017
The following table summarizes the carrying value and the estimated fair values of financial instruments as of February 28, 2017.
Thousands of Yen

Thousands of Yen
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Deferred tax asset:
Valuation difference on other assets acquired by merger¥24,633,095¥12,309,409

Deferred gains or losses on hedges

488,323712,266

Unearned revenue

339,961

319,728

Write-offs for long-term prepaid expenses

28,78032,211

Impairment losses of non-repudiation

85,628—Depreciation costs of trust leasehold rights

733

611

Accrued enterprise tax

39—

Excess allowance for doubtful accounts—

17

Subtotal¥25,576,559¥13,374,242

Valuation allowance(¥25,576,559)(¥13,374,242)

—

—

—

—

—

—

Total non-current deferred tax assets
Total deferred tax assets
Net deferred tax assets

32 Nomura Real Estate Master Fund

Carrying value (Note 1)

Fair value (Note 1)¥73,331,039¥73,331,039(ii) Short-term debt

(5,000,000)(5,000,000)—(iii) Current portion of investment corporation bonds(9,000,000)(9,042,508)¥42,508(iv) Current portion of long-term debt

(69,975,600)(69,997,721)

22,121(v) Investment corporation bonds(18,500,000)(19,979,231)

1,479,231(vi) Long-term debt

(396,308,400)(399,857,342)

3,548,942(vii) Derivative transactions(¥1,563,490)(¥1,563,490)—(i) Cash and bank deposits

Difference—

Nomura Real Estate Master Fund33

16. INVESTMENT AND RENTAL PROPERTIESFor the period from March 1, 2016 to August 31, 2016
The following table summarizes the carrying value and the estimated fair values of financial instruments as of August 31, 2016.
Thousands of Yen
Carrying value (Note 1)

Fair value (Note 1)¥75,270,568¥75,270,568

—

—

—

—

(iii) Current portion of investment corporation bonds(10,000,000)(10,074,295)¥74,295(iv) Current portion of long-term debt

(47,805,600)(47,886,883)

81,283(v) Investment corporation bonds(22,500,000)(24,314,967)

1,814,967(vi) Long-term debt

(329,466,200)(336,081,428)

6,615,228(vii) Derivative transactions(¥2,274,820)(¥2,274,820)—(i) Cash and bank deposits(ii) Short-term debt

Difference

Thousands of Yen

Note 3: Redemption schedule for cash and bank deposits as of February 28, 2017

Thousands of Yen

Cash and bank deposits
Total

After one year,
within two years

After two years, After three years,
within three years within four years¥73,331,039——¥73,331,039——

For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Balance at beginning of the period¥782,457,778¥790,306,905

Amount of increase (decrease) during the period

146,378,940(7,849,126)

Balance at end of the period

928,836,719

782,457,778

Fair value at end of the period¥996,084,000¥834,749,000

Carrying value

Note 1: The numbers in parenthesis indicate liabilities.
Note 2: Method for determining the fair value of financial instruments and derivative transactions(i) Cash and bank deposits and (ii) Shot-term debt
As these items are settled within a short-term period, their fair value is nearly equal to the carrying value. Therefore, for these items, the carrying value isreported as the fair value.
(iii) Current portion of long-term debt and (iv) Long-term debt
For floating-rate long-term debt, the carrying value is reported as it is considered to be approximately equal to the fair value because such debt reflects themarket interest rates within a short-term period. (However, the fair value of certain floating-rate long-term debt that qualifies for the special treatment ofinterest rate swaps (see “19. Derivatives and Hedge Accounting”) is determined by discounting the sum of its principal and interest payments net of any cash
flows from the interest rate swap at a rate reasonably estimated to be applicable to similar fixed-rate debt.) The fair value of fixed-rate long-term debt isdetermined by discounting the sum of its principal and interest payments at a rate reasonably estimated to be applicable to similar fixed-rate debt.
(v) Derivative transactions
See “19. Derivatives and Hedge Accounting.”

Due within
one year

The Company owns leasable office, leasable retail facilities, leasable logistics facilities and leasable residential (including land) in Greater Tokyo
area and other areas for the purpose of earning revenue from leasing. The following table summarizes the carrying value and the estimated fairvalue of these properties.

After four years,
within five years

After five years

—

—

—

—

—

—

Note 1: The carrying value represents the acquisition cost less accumulated depreciation.
Note 2: Of the change in investment and rental properties, the increase during the previous period is mainly attributable to the acquisition of PMO Tamachi (¥6,328,987
thousand), PMO Ginza Hatchome (¥4,025,053 thousand), PMO Shibakoen (¥3,975,082 thousand), Hirakata Kuzuha Logistics Center (¥3,516,505 thousand), PRIMEURBAN Meguro Mita (¥1,137,130 thousand), PRIME URBAN Chikusa (¥1,205,712 thousand) and Ryotokuji University Shin-Urayasu Campus (Land) (¥5,125,367
thousand). The decrease during the previous fiscal period is mainly attributable to the sale of NOF Nihonbashi Honcho Building (¥10,449,586 thousand), NOF
Tameike Building (¥4,804,276 thousand), NOF Shinagawa Konan Building (¥3,471,844 thousand), NOF Minami Shinjuku Building (¥2,219,005 thousand), Central
Shintomicho Building (¥1,328,098 thousand), Toho Edogawabashi Building (¥1,095,234 thousand), Toshin Meguro Building (¥854,458 thousand), Yokohama Odori
Koen Building (¥1,806,149 thousand), JCB Sapporo Higashi Building (¥3,266,519 thousand),PRIME URBAN Hatagaya (¥470,012 thousand), PRIME URBAN Ochiai(¥337,641 thousand), PRIME URBAN Sangen Jaya II (¥483,603 thousand), PRIME URBAN Kamikitazawa (¥596,632 thousand), PRIME URBAN Nakano (¥468,054
thousand), PRIME URBAN Ekoda (¥408,769 thousand), PRIME URBAN Urayasu II (¥219,614 thousand), and PRIME URBAN Yamahana (¥271,452 thousand) as well
as depreciation (¥4,203,908 thousand). The increase during the current period is mainly attributable to the acquisition of 19 properties as a result of the absorption
type merger with TOP REIT, Inc. (total of ¥137,495,038 thousand) and the acquisition of Landport Kashiwa Shonan II (¥10,916,634 thousand). The decrease during
the current period is mainly attributable to depreciation (¥4,754,117 thousand)Note 3: Fair value at the end of the period is the appraisal value or survey price determined by an outside real estate appraiser. However, the scheduled transfer price isused as the fair value for NOF Technoport Kamata Center Building, NOF Nihonbashi Honcho Building, Tennozu Park Side Building, Mitsubishi Motors Shibuya,
Mitsubishi Motors Suginami and Ito-Yokado Higashi-Narashino Store.

The real estate rental revenues and expenses for the fiscal period ended February 28, 2017 are presented in “16. Breakdown of Real Estate
Rental Revenues and Expenses”.

Redemption schedule for cash and bank deposits as of August 31, 2016

Thousands of Yen

Cash and bank deposits
Total

Due within
one year

After one year,
within two years

After two years, After three years,
within three years within four years¥75,270,568——¥75,270,568——

After four years,
within five years

After five years

—

—

—

—

—

—

Note 4: Redemption schedule for cash and bank deposits as of February 28, 2017

Thousands of Yen
Due within
one year

After one year,
within two years

After two years, After three years,
within three years within four years

After four years,
within five years

After five years

Short-term debt

¥5,000,000

—

—

—

—

—

Investment corporation bonds¥9,000,000——¥5,000,000—¥13,500,000

Long-term debt

¥69,975,600¥51,940,600¥60,685,600¥56,655,600¥47,715,600¥179,311,000

Total¥83,975,600¥51,940,600¥60,685,600¥61,655,600¥47,715,600¥192,811,000

Redemption schedule for debt as of August 31, 2016

Thousands of Yen
Due within
one year

Short-term debt

After one year,
within two years

After two years, After three years,
within three years within four years

After four years,
within five years

After five years

—

—

—

—

—

—

Investment corporation bonds¥10,000,000¥4,000,000—¥5,000,000—¥13,500,000

Long-term debt

¥47,805,600¥46,505,600¥48,285,600¥47,385,600¥49,435,600¥137,853,800

Total¥57,805,600¥50,505,600¥48,285,600¥52,385,600¥49,435,600¥151,353,800

17. SEGMENT INFORMATION
For the periods from September 1, 2016 to February 28, 2017 and from March 1, 2016 to August 31, 2016
Segment Information
Since the Company has been engaged in the real estate leasing business as a single segment, segment information has been omitted.
Related Information
1. Information about products and services
Since revenues from external customers of products and services within a single segment are more than 90 percent of total operating
revenues, information about products and services has been omitted.
2. Information about geographical areas(1) Revenues
Since more than 90 percent of the total operating revenues were generated from external customers in Japan, geographical breakdown ofrevenues has been omitted.
(2) Property and equipment
Since more than 90 percent of the total property and equipment on the balance sheet are located in Japan, geographical breakdown ofproperty and equipment has been omitted.
3. Information about major clients
For the period from September 1, 2016 to February 28, 2017
Customer name

Nomura Real Estate Partners Co., Ltd.

Related segment name

¥4,499,817

Rental real estate business

For the period from March 1, 2016 to August 31, 2016
Customer name

Nomura Real Estate Partners Co., Ltd.

34 Nomura Real Estate Master Fund

Revenues (Thousands of Yen)

Revenues (Thousands of Yen)

Related segment name

¥4,289,956

Rental real estate business

Nomura Real Estate Master Fund3518. BREAKDOWN OF REAL ESTATE RENTAL REVENUES AND EXPENSES

21. LEASESReal estate rental revenues and expenses for the fiscal period ended February 28, 2017 and August 31, 2016 consist of the following:

The future minimum rental revenues from tenants under non-cancelable operating lease of properties as of February 28, 2017 and August 31,
2016 are summarized as follows:

Thousands of Yen
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

¥34,714,979¥29,532,380

31,730,412

26,844,872

Rental revenues

29,030,376

24,461,221

Common area charges

2,700,036

2,383,651

2,984,567

2,687,508

Real estate rental revenues
Rental revenues

Other rental revenues
Parking revenues

689,795

533,526

Incidental income

2,174,961

2,069,384

Other miscellaneous revenues

119,81184,59815,791,522

13,489,929

Property management costs

1,692,981

1,614,328

Property management fees

901,770874,717

Real estate rental expenses

Property and other taxes

3,016,773

2,315,517

Utility expenses

1,807,086

1,711,878

Casualty insurance

45,751

37,6352,135,500

1,581,099

Land rents

208,052

193,397

Depreciation

4,757,368

4,205,687

Repairs and maintenance

Other rental expenses
Real estate rental profits

1,226,241955,671¥18,923,457¥16,042,451

Thousands of Yen
As of February 28, 2017

As of August 31, 2016

Due within one year

¥32,053,051¥24,861,465

Due after one year

83,352,588

71,432,067¥115,405,639¥96,293,532

Total

22. DERIVATIVES AND HEDGE ACCOUNTING
Derivative transactions as of February 28, 2017
(1) There were no derivative financial instruments not subject to hedge accounting.
(2) Derivative financial instruments subject to hedge accounting were as follows:
Thousands of Yen
Notional amount
Hedge accounting method

Main hedged item

(Note 1)

Due after one year

Fair value (Note 2)

Interest rate swaps:
Principal treatment method
Received/floating and paid/fixedType of derivative instruments

Long-term debt

¥175,500,000¥134,780,000(¥1,563,490) (Note 3)

Special treatment ofinterest rate swaps

Long-term debt

101,739,500

101,696,700(1,399,669) (Note 4)¥277,239,500¥236,476,700(¥2,963,160)

Interest rate swaps:
Received/floating and paid/fixed

Total

Note 1: Contract amount is based on notional amount.
Note 2: Fair value is calculated by swap counterparty, based on the actual market interest rate, etc.
Note 3: Out of the fair value, (¥17,856 thousand) is booked as “accrued expenses” on the Balance Sheet.
Note 4: Out of the fair value, (¥1,399,669 thousand) is not marked to market on the Balance Sheet, since adopting special treatment for interest rate swaps.

Derivative transactions as of August 31, 2016
(1) There were no derivative financial instruments not subject to hedge accounting.
(2) Derivative financial instruments subject to hedge accounting were as follows:

19. IMPAIRMENT LOSSIn the current period ended, the Company recorded impairment loss on the following asset group.

Thousands of Yen

Property name

Use

Type

Location

Impairment loss
(Thousands of Yen)

Tennozu Park Side Building

OfficeBuildings, land,in trust, etc.

Tokyo

¥220,723

Hedge accounting method

Type of derivative instruments

Main hedged item

(Note 1)

Due after one year

Fair value (Note 2)

NOF Technoport Kamata Center Building

OfficeBuildings, land,in trust, etc.

Tokyo49,074

Principal treatment method

Interest rate swaps:
Received/floating and paid/fixedLong-term debt

¥135,300,000¥117,600,000(¥2,274,820) (Note 3)

Special treatment ofinterest rate swaps

Interest rate swaps:
Received/floating and paid/fixedLong-term debt

For the purpose of calculating impairment loss, each property is considered an asset group. NMF reached sales agreements for NOF Technoport
Kamata Center Building and Tennozu Park Side Building on December 22, 2016, and April 4, 2017, respectively. As a result, the properties’ bookvalues were reduced to their respective recoverable amounts and the difference was recorded as impairment loss under operating expenses.
Any impairment loss recognized as a result of sales is regarded as having the characteristics of an operating expense and is therefore recorded
under operating expenses in accordance with Article 48 Paragraph 2 of the Regulations Concerning Accounting of Investment Corporations.
Also, the recoverable amounts of the asset groups are measured using the respective net realizable values or values in use. The net realizablevalues are calculated by subtracting the expected disposal costs from the actual sales prices. In the calculation of values in use, the discountrate is not taken into account because the estimated periods of future cash flows are all short term.

Notional amount

Total

114,760,900

101,718,100(2,159,763) (Note 4)¥250,060,900¥219,318,100(¥4,434,584)

Note 1: Contract amount is based on notional amount.
Note 2: Fair value is calculated by swap counterparty, based on the actual market interest rate, etc.
Note 3: Out of the fair value, (¥20,365 thousand) is booked as “accrued expenses” on the Balance Sheet.
Note 4: Out of the fair value, (¥2,159,763 thousand) is not marked to market on the Balance Sheet, since adopting special treatment for interest rate swaps.

20. BREAKDOWN OF GAIN AND LOSS ON SALES OF REAL ESTATE
Thousands of Yen
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

Gain on sale of real estate
Proceeds from sale of real estate—¥29,633,000

Cost of real estate—

27,746,678

Other related sales expense—

444,047

Gain on sale of real estate—¥1,442,275

Proceeds from sale of real estate—¥4,500,000

Cost of real estate—

4,804,277

Other related sales expense—

24,924

Loss on sale of real estate—¥329,201

Loss on sale of real estate

36 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund3723. CASH DISTRIBUTIONS

24. INFORMATION ON ALLOWANCE FOR TEMPORARY DIFFERENCE ADJUSTMENTS
For the period
from September 1, 2016
to February 28, 2017

For the period
from March 1, 2016
to August 31, 2016

1. Retained earnings at end of period¥10,928,087,899¥12,225,011,401

2. Distributions in excess of retained earnings¥3,994,889,150¥2,095,491,630

Of which, allowance for temporary difference adjustment
Of which, other distributions in excess of net income
3. Incorporation into unitholders' capital
Of which, reversal of allowance for temporary difference adjustments
4. Distributions[Distributions (per unit)]
Of which, distributions of earnings[Of which, distributions of earnings (per unit)]
Of which, allowance for temporary difference adjustments[Of which, allowance for temporary difference adjustments (per unit)]
Of which, other distributions in excess of net income[Of which, other distributions in excess of net income (per unit)]
4. Retained earnings carried forward¥2,702,301,980¥1,292,587,170¥708,820,764¥708,820,764¥12,666,517,640(¥3,028)

Thousands of Yen

Related assets, etc.

Provision of allowancefor temporary
difference adjustments

Reason of provision

Goodwill

Amortization of goodwill¥2,622,243

Land, buildings, etc.

Merger expenses

1,390,273

Land, buildings, etc.

Impairment loss

269,797¥763,347,909

Long-term deposits

Shortfall of reserve for repairs¥763,347,909

Increase - subtotal—¥2,095,491,630¥11,300,022,360(¥3,036)¥8,671,628,490¥9,204,530,730(¥2,073)(¥2,473)¥2,702,301,980—(¥646)—¥1,292,587,170¥2,095,491,630(¥309)(¥563)¥1,547,638,645

For the period from September 1, 2016 to February 28, 2017
1. Reason of provision, related assets and amounts¥2,257,132,762

Calculation method of distribution amountConcerning distributions for the 3rd fiscal period, NMF decided the distribution per unit will be ¥3,028. In order to maximize the distribution of
earnings included in deductible expenses by applying special measures for tax treatment (Article 67-15 Paragraph 1 of the Act on Special
Measures Concerning Taxation (Act No. 26 of 1957)), NMF decided to distribute almost the entire amount of net income as stipulated in Article
136 Paragraph 1 of the Investment Trust Act, less the reversal of allowance for temporary difference adjustments (as stipulated in Article 2
Paragraph 2 (30) of the Regulations Concerning Accounting of Investment Corporations, the same applies hereinafter), excluding the portion forwhich per-unit distributions would be less than ¥1. Accordingly, NMF declared an earnings distribution per investment unit of ¥2,073. This
amount excludes the distribution in excess of earnings discussed below. In accordance with the distribution policy stipulated in the Articles ofIncorporation and in consideration of the impact that such costs related to the merger of the three REITs that created NMF and the absorptiontype merger with TOP REIT as goodwill amortization costs, net asset deductions (as described in Article 2 Paragraph 2 (30) (b) of the Regulations
Concerning Accounting of Investment Corporations) and the reversal of allowance for temporary difference adjustments (excluding net asset
deductions; hereinafter referred to together with goodwill amortization costs and other costs related to the merger of the three REITs and theabsorption-type merger with TOP REIT as “merger-related costs”) will have on distributions, NMF will make a distribution in excess of earnings
in an amount that it determines equivalent to the merger-related costs (hereinafter “distribution in excess of earnings”). When implementing a
distribution in excess of earnings, if the period’s distribution of allowance for temporary difference adjustments is less than the amount ofmerger-related costs, other distributions in excess of net income will also be made. For the fiscal period under review, NMF decided to record¥3,994 million in distributions in excess of earnings. This figure is equivalent to almost the entire sum (excluding the portion for which per-unit
distributions would be less than ¥1) of ¥2,622 million in goodwill amortization and ¥1,374 million in fees paid to the Asset Management
Company for the absorption-type merger with TOP REIT. Of this, ¥2,702 million will be distributions of allowance for temporary difference
adjustments, for a per-unit distribution of allowance for temporary difference adjustments of ¥646. Other distributions in excess of net income
will be ¥1,292 million; and other distributions in excess of net income per unit will be ¥309.

15,186
4,297,499

Buildings, building improvements, etc.

Depreciation deficiency equivalent

Unearned income, etc.

Reversal of loss on interest rate swap due to merger(1,302,166)

Other

—

(216,262)(76,769)

Decrease - subtotal(1,595,197)

Total¥2,702,302

2. Reason of reversal, related assets and amounts
Thousands of Yen

Related assets, etc.

Reversal of allowancefor temporary
difference

Reason of reversal

Land, buildings, etc.

Sale of property and amortization of merger expenses

Deferred gains or losses on hedges

Changes in fair value of derivative transactions—*(708,820)

Total(¥708,820)* The amount cancelled in the period under review (¥6,319 thousand) was deducted from “Depreciation deficiency equivalent”under 1 above.

3. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land in trust, etc.
LeaseholdUpon sale, the corresponding amount is scheduled to be reversed.

Leasehold in trust
Investment securities

Upon redemption, etc., the corresponding amount is scheduled to be reversed.

(3) Impairment loss
At the time of the sale of the relevant property, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount is scheduled to be reversed.
For the period from March 1, 2016 to August 31, 2016
1. Reason of reversal, related assets and amounts
Thousands of Yen

Related assets, etc.

Reason of reversal

Reversal of allowancefor temporary
difference adjustments

Land, buildings, etc.

Sale of property and depreciation of merger expenses

Land, buildings, etc.

Sale of property on which impairment was recognized

79,020

Deferred gains or losses on hedges

Changes in fair value of derivative transactions

613,141

Total¥71,187¥763,348

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.

38 Nomura Real Estate Master Fund

Nomura Real Estate Master Fund39

(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land in trust, etc.
LeaseholdUpon sale, the corresponding amount is scheduled to be reversed.

(3) Number of Investment Units Issued

Leasehold in trust
Investment securities(2) Method of Calculation
Each investment corporation appointed a financial advisor (hereafter “FA”) for the absorption-type merger and requested that said financial
advisor perform a financial analysis of the merger ratio. NMF appointed Nomura Securities Co., Ltd., and TOP appointed Daiwa Securities
Co., Ltd. Based on comprehensive consideration of such factors as each corporation’s financial performance, assets and liabilities, andfuture outlook, as well as the merits of the absorption-type merger for each corporation and the results of the financial analyses conductedby the two FAs, NMF and TOP reached an agreement with regard to the above merger ratio through careful negotiation and concluded on
absorption-type merger agreement.

Names of acquirees

Upon redemption, etc., the corresponding amount is scheduled to be reversed.

(3) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount is scheduled to be reversed.

Investment units issued

TOP461,120 units

5. Details on and Amount of Main Merger Expenses

25. BUSINESS COMBINATION
For the period from September 1, 2016 to February 28, 2017

Description

AmountFA fees¥240,000 thousand

Acquisition fees for merger¥1,374,890 thousand

Business Combination through Acquiree
1. Overview of Business Combination(1) Name and Business Description of Acquirees
Name of acquire

Business description

TOP REIT, Inc. (hereinafter, “TOP”)

Real estate investment trust(2) Main Reasons for Business Combination
NMF believes that the absorption-type merger with TOP presented a rare opportunity for external growth in the heated real estate
acquisition market. Furthermore, the absorption-type merger with TOP increased NMF’s ratio of investment in properties for which futureinternal growth can be expected, specifically properties that are in upside sectors or located within Tokyo’s five central wards. TOP
expected that, because the absorption-type merger would make Nomura Real Estate Group, a general real estate developer, its sponsor,
said merger would promote external growth by reinforcing the property pipeline. Furthermore, TOP expected that the absorption-typemerger would significantly diversify its portfolio and thereby improve its income stability. Thus, having reached the shared understandingthat the absorption-type merger would best increase their respective unitholder value, NMF and TOP entered into an absorption-typemerger agreement.
(3) Date of Business Combination
September 1, 2016(4) Legal Form of Business Combination
An absorption-type merger with NMF as the surviving corporation and TOP as the absorbed corporation.

7. Breakdown of Assets Acquired and Liabilities Assumed (As of the date of the business combination)
Thousands of Yen

Current assets¥10,701,317

Non-current assets

138,313,333

Total assets¥149,014,650

Current liabilities¥43,815,959

Long-term liabilities

53,500,119

Total liabilities¥97,316,078

There was no impact since the acquisition date is the same as the beginning date of the fiscal period(6) Main Reasons for Determining Acquiring Company
NMF was determined to be the acquiring company in accordance with the Accounting Standards for Business Combinations and otherrelevant standards based on a comprehensive consideration of such factors as corporate scale, including each company’s total assets andnet income; the ratio of voting rights that would be controlled by each company’s unitholders after the absorption-type merger; and thecomposition of the Board of Directors after the absorption-type merger.

Previous fiscal period (From from March 1, 2016 to August 31, 2016)
Not applicable

26. SIGNIFICANT SUBSEQUENT EVENTSAsset Sales

2. Period for which the Operating Results of Acquiree Included in the Statement of Income and Retained Earnings
Name of acquire

Operating results period

TOP

September 1, 2016 to February 28, 2017

3. Acquisition Cost of Acquiree and the Breakdown
Name of acquire

Acquisition costTOP

¥78,713,184 thousand

4. Exchange Ratio, Method of Calculation and Number of Investment Units Issued as Consideration for the Acquisition(1) Exchange Ratio of Investment Units

40 Nomura Real Estate Master Fund

(2) Reason
Goodwill resulted from the acquisition of the acquiree, TOP, and represents the excess of the acquisition cost (¥78,713,184 thousand) overthe fair value of its net assets (¥51,698,571 thousand).
(3) Method of Goodwill Amortization and Amortization Period
Goodwill is being amortized using the straight-line method over 20 years.

8. Estimated Impact on the Statement of Income and Retained Earnings for the Fiscal Period under Review Assuming the Business Combination
Was Completed at the Beginning of the Fiscal Period(5) Name of the Investment Corporation after Business Combination
Nomura Real Estate Master Fund, Inc.

Merger Ratio

6. Amount and Reason for Goodwill(1) Amount of Goodwill¥27,014,612 thousand

NMF

TOP

1.00

2.62

(1) NMF sold the following asset after the conclusion of the 3rd fiscal period (February 28, 2017).
a. NOF Technoport Kamata Center Buildings 4YPE OF ASSET
4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATEs 5SE /FlCEs #ONTRACT DATE$ECEMBER  s 4RANSFER DATE-ARCH  s 4RANSFER PRICEc  MILLION
s "UYER! DOMESTIC SPECIAL PURPOSE CORPORATION TOKUTEI MOKUTEKI KAISHAs )MPACT ON TH lSCAL PERIOD EARNINGS .OTE

Nomura Real Estate Master Fund

41

INDEPENDENT AUDITOR’S REPORT(2) NMF reached sales agreements and sold the following assets after the conclusion of the 3rd fiscal period (February 28, 2017).
a. NOF Nihonbashi Honcho Buildings 4YPE OF ASSET
4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATEs 5SE /FlCEs #ONTRACT DATE-ARCH  s 4RANSFER DATE-ARCH  s 4RANSFER PRICEc  MILLION
s "UYER.OMURA 2EAL %STATE $EVELOPMENT #O ,TDs )MPACT ON TH lSCAL PERIOD EARNINGS 3CHEDULED c MILLION
b. Tennozu Park Side Buildings 4YPE OF ASSET
s 5SE
s #ONTRACT DATE
s 4RANSFER DATE 3CHEDULED 
s 4RANSFER PRICE 3CHEDULED 
s "UYERs )MPACT ON TH lSCAL PERIOD EARNINGS

4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATE/FlCE!PRIL  -AY  c  MILLION! DOMESTIC SPECIAL PURPOSE CORPORATION TOKUTEI MOKUTEKI KAISHA .OTE(3) NMF reached sales agreements to sell the following assets after the conclusion of the 3rd fiscal period (February 28, 2017).
a. Mitsubishi Motors Shibuya
s 4YPE OF ASSET
4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATEs 5SE 2ETAIL FACILITY LAND
s #ONTRACT DATE-ARCH  s 4RANSFER DATE 3CHEDULED *UNE  s 4RANSFER PRICE 3CHEDULED c  MILLION
s "UYER.OMURA 2EAL %STATE $EVELOPMENT #O ,TDs )MPACT ON TH lSCAL PERIOD EARNINGS 3CHEDULED c MILLION
b. Mitsubishi Motors Suginami
s 4YPE OF ASSET
s 5SE
s #ONTRACT DATE
s 4RANSFER DATE 3CHEDULED 
s 4RANSFER PRICE 3CHEDULED 
s "UYERs )MPACT ON TH lSCAL PERIOD EARNINGS 3CHEDULED 

4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATE
2ETAIL FACILITY LAND-ARCH  *UNE  c MILLION.OMURA 2EAL %STATE $EVELOPMENT #O ,TDc MILLION

The impact of (1) through (3), above, on earnings for the 4th fiscal period (March 1, 2017 to August 31, 2017) will be recorded as gain on sales ofreal estate under operating revenues.
(Note) An amount equivalent to the loss on sales of real estate resulting from the sales of NOF Technoport Kamata Center Building and Tennozu Park Side Building has
been recorded as impairment loss.
For details, please refer to “Notes to Impairment Loss” above.

(Additional Information)
Asset Sales(1) NMF plans to sell the following asset after the conclusion of the 3rd fiscal period (February 28, 2017).
a. Ito-Yokado Higashi-Narashino Stores 4YPE OF ASSET
4RUST BENElCIARY INTEREST MAINLY IN REAL ESTATEs 5SE 2ETAIL FACILITY
s #ONTRACT DATE$ECEMBER  s 4RANSFER DATE 3CHEDULED *UNE  s 4RANSFER PRICE 3CHEDULED c MILLION
s "UYER.OMURA 2EAL %STATE $EVELOPMENT #O ,TDs )MPACT ON TH lSCAL PERIOD EARNINGS 3CHEDULED c MILLION
The impact of this sale on earnings for the 4th fiscal period (March 1, 2017 to August 31, 2017) will be recorded as gain on sales of real estate
under operating revenues.

INVESTOR INFORMATIONIR Calendar
Announcement of financial results(Mid-April)

January

February

March

April

May

Announcement of financial results(Mid-October)

June

July

Commencement of payment of distributions
Dispatch of Asset Management Report(Mid-May)

Fiscal period end(End of February)

Number of Investment Units

AugustSeptember

Fiscal period end(End of August)OctoberNovember

DecemberCommencement of payment of distributions
Dispatch of Asset Management Report(Mid-November)

Top 10 Unitholders

Individuals and others

Other domestic corporations

367,547 units (8.8%)

329,150 units (7.9%)

Individuals and others
Financial institutions

Other domestic corporations

Unitholder

Units heldShare

1 Japan Trustee Services Bank, Ltd.

919,626

21.98%

2 The Master Trust Bank of Japan, Ltd.

366,525

8.76%

3 Trust & Custody Services Bank, Ltd.

316,097

7.56%

4 Nomura Real Estate Development Co., Ltd.

210,671

5.04%

5 The Nomura Trust and Banking Co., Ltd.

152,141

3.64%

6 NOMURA BANK (LUXEMBOURG) S.A.

117,060

2.80%

STATE STREET BANK WEST CLIENT - TREATY
7505234

109,069

2.61%

8

STATE STREET BANK - WEST PENSION FUND
CLIENTS - EXEMPT 505233

74,5001.78%

33,085 (96.5%)

9

STATE STREET BANK AND TRUST COMPANY
505012

65,521

1.57%

Individuals and others
Other domestic corporations 537 (1.6%)

10

CBNY DFA INTERNATIONAL REAL ESTATESECURITIES PORTFOLIO

42,901

1.03%

Total

2,374,111

56.75%

367,547units(8.8%)(including
financial
instruments business operators) 329,150 units (7.9%)
2,131,520 units (51.0%)
Financial institutions(including financial instruments business operators)

2,131,520 units (51.0%)

Foreign corporations

1,354,913 units (32.4%)
Foreign corporations

1,354,913 units (32.4%)

Numberof Unitholders
Financial institutions(including financial instruments business operators)
183 (0.5%)

Financial institutions (including financial instruments business operators)
Individuals and others
183 (0.5%)

33,085 (96.5%)

Foreign corporations 489 (1.4%)

Other domestic corporations 537 (1.6%)
Foreign corporations 489 (1.4%)

Guide to Website
http://www.nre-mf.co.jp/en/
We hope that you will take the time to access and view the NMF site.
The English website is at http://www.nre-mf.co.jp/en/.
Disclosure materials of the former three REITs before the merger are
also available at “Disclosure Materials” under “Investor Relations.”

44 Nomura Real Estate Master Fund

Note: The figures are based on data as of February 28, 2017.