NEWS RELEASE
Nov 24, 2016

R&I Affirms A+, Stable: Nomura Real Estate Master Fund, Inc.
Rating and Investment Information, Inc. (R&I) has announced the following:
ISSUER:

Nomura Real Estate Master Fund, Inc.
Issuer Rating: A+, Affirmed
Rating Outlook: Stable

RATIONALE:
Nomura Real Estate Master Fund, Inc. (NMF) is Japan's largest diversified REIT that was establishedin October 2015 through the merger of three REITs operated by the Nomura Real Estate group. With afocus on the Greater Tokyo area, NMF invests in various types of properties in a balanced manner.
Nomura Real Estate Holdings, Inc. serves as a sponsor.
In September 2016, NMF merged with Top REIT, Inc. As a result of the merger, NMF acquired severalflagship properties, including NEC Head Office Building, and the asset size expanded to 930 billion yen.
In the post-merger portfolio, properties in the Greater Tokyo area represent 83%. The breakdown of theportfolio shows that office buildings account for 48%, residential properties 19%, retail properties 16% andlogistics properties 16%. The ten largest properties represent only 25% of the portfolio, suggesting theportfolio is highly diversified.
Capitalizing on the expanded asset scale, the REIT is pursuing strategic property replacement. After
its establishment, NMF sold approximately 34 billion yen worth of properties, mostly older office buildings,
aiming to rejuvenate the portfolio.
NMF's property management is sound. The occupancy rate of office buildings exceeds 98% atpresent, and rents are gradually recovering. Earnings from residential properties are stable. Logistics
properties, as well as retail properties located in suburbs, also generate steady earnings under long-term
leasing contracts with tenants.
The REIT plans to manage the LTV ratio within a 40-50% range. The ratio (calculated after excluding
goodwill from total assets) as of September 2016 appears to be about 49%. With the appraisal value
exceeding the book value, NMF's properties are generating unrealized gains.
Funding is in good shape. Funding sources are stable, consisting mainly of major domestic financialinstitutions. The average remaining term to maturity of debts is as long as around four years, andmaturities are staggered. With a committed line of credit totaling 50 billion yen, together with cash anddeposits, sufficient liquidity is maintained.
The Rating Outlook is Stable. R&I expects the REIT to continue to enjoy solid earnings, given its welldiversified portfolio, as well as a high occupancy rate. There is no significant problem with the leveragelevel, and the funding base is stable. R&I will continuously keep an eye on to what extent the REIT canenhance the portfolio in collaboration with the sponsor.
The primary rating methodology applied to this rating is provided at "Rating Methodology for J-REIT".
The methodology is available at the web site listed below, together with other rating methodologies thatare taken into consideration when assigning the rating.
http://www.r-i.co.jp/eng/cfp/about/methodology/index.html■Contact: Investors Service Department
TEL.+81-(0)3-3276-3511■Media Contact : Corporate Planning Division (Public Relations) TEL.+81-(0)3-3276-3438

Rating and Investment Information, Inc.

E-mail. infodept@r-i.co.jp

Nihonbashi 1-chome Mitsui Bldg., 1-4-1, Nihonbashi, Chuo-ku, Tokyo 103-0027,

http://www.r-i.co.jp

Credit ratings are R&I's opinions on an issuer's general capacity to fulfill its financial obligations and the certainty of the fulfillment of its individual obligations as promised (creditworthiness) and are notstatements of fact. Further, R&I does not state its opinions about any risks other than credit risk, give advice regarding investment decisions or financial matters, or endorse the merits of any investment.
R&I does not undertake any independent verification of the accuracy or other aspects of the related information when issuing a credit rating and makes no related representations or warranties. R&I is notliable in any way for any damage arising in relation to credit ratings (including amendment or withdrawal thereof). As a general rule, R&I issues a credit rating for a fee paid by the issuer. For details,
please refer to http://www.r-i.co.jp/eng/policy/policy.html.
© Rating and Investment Information, Inc.

NEWS RELEASE
R&I RATINGS:ISSUER:RATING:

Nomura Real Estate Master Fund, Inc. (Sec. Code: 3462)
Issuer Rating
A+, Affirmed

RATING OUTLOOK:

StableUnsec. Str. Bonds No.2

Issue Date

Maturity Date

Issue Amount (mn)

Mar 16, 2005

Mar 16, 2020

JPY 5,000

RATING:

A+, Affirmed

Unsec. Str. Bonds No.6

Issue Date

Maturity Date

Issue Amount (mn)

Mar 19, 2007

Mar 17, 2017

JPY 5,000

RATING:

A+, Affirmed

Unsec. Str. Bonds No.7

Issue Date

Maturity Date

Issue Amount (mn)

Mar 19, 2007

Mar 17, 2028

JPY 4,500

RATING:

A+, Affirmed

Unsec. Str. Bonds No.9

Issue Date

Maturity Date

Issue Amount (mn)Nov 26, 2010

Nov 24, 2017

JPY 4,000

RATING:

A+, Affirmed

Unsec. Str. Bonds No.10

Issue Date

Maturity Date

Issue Amount (mn)Nov 25, 2014

Nov 25, 2024

JPY 6,000■Contact: Investors Service Department
TEL.+81-(0)3-3276-3511■Media Contact : Corporate Planning Division (Public Relations) TEL.+81-(0)3-3276-3438

E-mail. infodept@r-i.co.jp

RATING:

A+, Affirmed

Rating and Investment Information, Inc.

Nihonbashi 1-chome Mitsui Bldg., 1-4-1, Nihonbashi, Chuo-ku, Tokyo 103-0027,

http://www.r-i.co.jp

Credit ratings are R&I's opinions on an issuer's general capacity to fulfill its financial obligations and the certainty of the fulfillment of its individual obligations as promised (creditworthiness) and are notstatements of fact. Further, R&I does not state its opinions about any risks other than credit risk, give advice regarding investment decisions or financial matters, or endorse the merits of any investment.
R&I does not undertake any independent verification of the accuracy or other aspects of the related information when issuing a credit rating and makes no related representations or warranties. R&I is notliable in any way for any damage arising in relation to credit ratings (including amendment or withdrawal thereof). As a general rule, R&I issues a credit rating for a fee paid by the issuer. For details,
please refer to http://www.r-i.co.jp/eng/policy/policy.html.
© Rating and Investment Information, Inc.