Nomura Real Estate Master Fund, Inc.
The Report on Financial Resultsand Operational Status
for the six-month period ended February 28, 2023

Independent Auditor’s Report

The Board of Directors
Nomura Real Estate Master Fund, Inc.

OpinionWe have audited the accompanying financial statements of Nomura Real Estate Master Fund,
Inc. (the Company), which comprise the balance sheet as at February 28, 2023, and thestatements of income and retained earnings, changes in net assets, and cash flows for the sixmonth period then ended, and notes to the financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, thefinancial position of the Company as at February 28, 2023, and its financial performance and its
cash flows for the six-month period then ended in accordance with accounting principles
generally accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of our report. We are independent of the Company
in accordance with the ethical requirements that are relevant to our audit of the financial
statements in Japan, and we have fulfilled our other ethical responsibilities in accordance withthese requirements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.
Other Information
The other information comprises the information included in the Report on Financial Resultsand Operational Status that contains audited financial statements but does not include thefinancial statements and our auditor’s report thereon.
We have concluded that the other information does not exist. Accordingly, we have not
performed any work related to the other information.
Responsibilities of Management and the Supervisory Director for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statementsin accordance with accounting principles generally accepted in Japan, and for such internal
control as management determines is necessary to enable the preparation of financial statementsthat are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s
ability to continue as a going concern and disclosing, as required by accounting principles
generally accepted in Japan, matters related to going concern.
The Supervisory Director is responsible for overseeing the Company’s financial reporting
process.
Ernst & Young ShinNihon LLC

Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue anauditor’s report that includes our opinion. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected toinfluence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we
exercise professional judgment and maintain professional skepticism throughout the audit. We
also:
・ Identify and assess the risks of material misstatement of the financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
・ Consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances for our risk assessments, while the purpose of the audit of
the financial statements is not expressing an opinion on the effectiveness of the Company’s
internal control.
・ Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
・ Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company’s ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
・ Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation in accordance with accounting
principles generally accepted in Japan.
We communicate with the Executive Director regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.
We also provide the Executive Director with a statement that we have complied with the ethicalrequirements regarding independence that are relevant to our audit of the financial statements inJapan, and to communicate with them all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, related safeguards.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company whichis required to be disclosed pursuant to the provisions of the Certified Public Accountants Act ofJapan.
Ernst & Young ShinNihon LLC

Ernst & Young ShinNihon LLC
Tokyo, JapanMay 29, 2023

森重 俊寛
Toshihiro Morishige
Designated Engagement Partner
Certified Public Accountant

井上 裕人
Hiroto Inoue
Designated Engagement Partner
Certified Public Accountant

Ernst & Young ShinNihon LLC

Nomura Real Estate Master Fund, Inc.
15th Fiscal Period Report on Financial Results and Operational Status

BALANCE SHEET
Thousands of Yen
As of August 31, 2022

As of February 28, 2023

ASSETS
Current Assets:
Cash and bank deposits

44,892,030

53,094,006

Rental receivables

758,664

723,460

Other current assets

1,404,860

1,469,112

47,055,556

55,286,578

Land

749,345,447

746,983,944

Buildings and structures

373,580,602

372,503,095

Machinery and equipment

2,280,198

2,353,457

Tools, furniture and fixtures

1,930,255

2,038,150

Leased assets

4,752

4,752

Construction in progress

54,30555,572

1,127,195,561

1,123,938,973(73,246,268)(78,105,243)

1,053,949,292

1,045,833,729

Goodwill

69,853,523

67,231,280

Leasehold rights

13,227,005

13,226,619

Intangible assets

46,23838,7412,076,655

2,111,516

Long-term deposits

354,007369,506

Security deposits

885,773875,773

Deferred investment corporation bond issuance costs

133,571

125,586

86,576,775

83,979,025

1,187,581,625

1,185,099,333

Total current assets

Property and Equipment:

SubtotalLess accumulated depreciation
Net property and equipment

Investments and Other Assets:Long-term prepaid expenses

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

-1-

Thousands of Yen
As of August 31, 2022

As of February 28, 2023

LIABILITIESCurrent Liabilities:
Trade accounts payable

2,676,132

1,964,434

Current portion of long-term debt

64,435,600

55,435,600

871

871

2,613,692

2,730,744

363,161

335,981

2,088

1,920

Accrued consumption taxes

1,015,547

888,352

Rent received in advance

5,617,495

5,583,396

Unearned revenue

12,5307,706

Provision for loss on disaster

37,702

20,370Derivatives liabilities

33,48625,543

Other current liabilities

7,824

15,99376,816,132

67,010,914

Investment corporation bonds

32,000,000

32,000,000

Long-term debt

421,027,600

429,984,800

Lease obligations

1,597

1,161

Long-term advances received

2,324

—

Security deposits from tenants

42,585,899

42,561,971

Derivatives liabilities

20,040—Total long-term liabilities

495,637,461

504,547,933

Total Liabilities

572,453,594

571,558,848

244,996,671

245,043,416

Capital surplus

394,012,959

394,012,959

Allowance for temporary difference adjustment(20,286,524)(22,140,004)

Other deductions from capital surplus(17,142,147)(17,349,209)

Total deductions from capital surplus(37,428,672)(39,489,214)

Net capital surplus

356,584,286

354,523,744

Retained earnings

13,594,898

13,997,163

Total surplus

370,179,185

368,520,907

Total unitholders’ equity

615,175,856

613,564,324

Lease obligations
Other accounts payable
Accrued expenses
Accrued income taxes

Total current liabilities

Long-term Liabilities:

NET ASSETS

Unitholders’ Equity:
Unitholders’ capital
Surplus-2-

Thousands of Yen
As of August 31, 2022

As of February 28, 2023

Valuation and Translation Adjustments:
Deferred gains or losses on hedges(47,825)(23,838)

Total valuation and translation adjustments(47,825)(23,838)

615,128,031

613,540,485

1,187,581,625

1,185,099,333

Total Net Assets

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

-3-

STATEMENT OF INCOME AND RETAINED EARNINGS
Thousands of Yen
For the period
fromMarch 1, 2022
to August 31, 2022

For the period
from
September 1, 2022
to February 28, 2023

OPERATING REVENUES AND EXPENSES

Operating Revenues:
Real estate rental revenues

38,264,482

38,347,670

Gain on sales of real estate

757,969

1,638,421

39,022,452

39,986,092

Real estate rental expenses

16,652,112

17,069,913

Asset management fees

3,460,491

3,473,909

Asset custody fees

56,99057,113Administrative service fees

171,889

171,765

Amortization of goodwill

2,622,242

2,622,242

Other operating expenses

474,215477,20723,437,941

23,872,152

15,584,510

16,113,940

256

239

3,080

4,150

133

—

6

1,423

3,476

5,813

1,578,165

1,531,395

173,239

170,523

7,984

7,984

434,013456,975

2,286

2,290

2,195,689

2,169,168

13,392,297

13,950,584

155,651—

155,651—

Operating Expenses:

Operating Income

NON-OPERATING REVENUES AND EXPENSES

Non-Operating Revenues:
Interest income
Reversal of dividends payable
Interest on refund
Other non-operating revenues

Non-Operating Expenses:
Interest expense
Interest expenses on investment corporation bonds
Amortization of investment corporation bonds issuance
costs
Loan arrangement fees
Other non-operating expenses

Ordinary Income

Extraordinary Gain
Gain on donation of non-current assets-4-Extraordinary Loss
Loss on disaster

Income before Income Taxes-5-46,519—46,519—13,501,429

13,950,584

Thousands of Yen
For the period
fromMarch 1, 2022
to August 31, 2022

For the period
from
September 1, 2022
to February 28, 2023

Income Taxes:
Current

Net Income

Retained earnings brought forward

Retained Earnings at End of Period
The accompanying notes to financial statements are an integral part of these statements.

-6-

2,119

1,957

2,119

1,957

13,499,309

13,948,627

95,58948,535

13,594,898

13,997,163

STATEMENT OF CHANGES IN NET ASSETSFor the period from March 1, 2022 to August 31, 2022
Thousands of Yen
Unitholders’ Equity
SurplusCapital surplus

Balance as of

Deductions from capital surplus

Unitholders’UnitscapitalCapitalAllowance for

Other

Total

Net capitalsurplustemporary

deductions

deductions

surplusdifference

from capitalfrom capitaladjustment

surplussurplus4,715,200

244,893,909

394,012,959(18,295,737)(16,214,225)(34,509,963)

359,502,995

—

—

—

—

—

—

—

—

102,762—

102,762(102,762)

—

—

—

—

—

(2,093,548)—(2,093,548)(2,093,548)

Other distributions in excess of
net earnings

—

—

—

—

(825,160)(825,160)(825,160)

Net income

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

102,762—(1,990,786)(927,922)(2,918,708)(2,918,708)

4,715,200

244,996,671

394,012,959(20,286,524)(17,142,147)(37,428,672)

356,584,286

March 1, 2022
Distributions of retained earnings
Reversalofallowance

temporaryfor

difference

adjustments
Distributions in excess of net
earnings from allowance fortemporary difference adjustments

Net changes of items other thanunitholders' equity
Total changes of items during theperiodBalance as ofAugust 31, 2022

Thousands of Yen
Valuation and Translation

Unitholders’ Equity
SurplusRetained

Total surplus

earnings
Balance as ofMarch 1, 2022
Distributions of retained earnings
Reversalofallowance

temporary

Adjustments
Totalunitholders'

Deferred gains
or losses on

equityhedgesTotalvaluation andTotal
net assets

translation
adjustments

12,575,751

372,078,747

616,972,656(94,570)(94,570)

616,878,085(12,377,400)(12,377,400)(12,377,400)——(12,377,400)(102,762)(102,762)

—

—

—

—

—

(2,093,548)(2,093,548)——(2,093,548)—(825,160)(825,160)——(825,160)

13,499,309

13,499,309

13,499,309——

13,499,309

—

—

—

46,744

46,744

46,744

1,019,146(1,899,561)(1,796,799)

46,744

46,744(1,750,054)

13,594,898

370,179,185

615,175,856(47,825)(47,825)

615,128,031

fordifference

adjustments
Distributions in excess of net
earnings from allowance fortemporary difference adjustments
Other distributions in excess of
net earnings
Net income
Net changes of items other thanunitholders' equity
Total changes of items during theperiodBalance as ofAugust 31, 2022

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

-7-

For the period from September 1, 2022 to February 28, 2023
Thousands of Yen
Unitholders’ Equity
SurplusCapital surplus

Balance as of
September 1, 2022

capitalofallowance

temporary

CapitalAllowance for

Other

Total

Net capitalsurplustemporary

deductions

deductions

surplusdifference

from capitalfrom capitaladjustment

surplussurplus4,715,200

244,996,671

394,012,959(20,286,524)(17,142,147)(37,428,672)

356,584,286

—

—

—

—

—

—

—

—

46,744—

46,744(46,744)

—

—

—

—

—

(1,900,225)—(1,900,225)(1,900,225)

—

—

—

—

(160,316)(160,316)(160,316)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

46,744—(1,853,480)(207,061)(2,060,542)(2,060,542)

4,715,200

245,043,416

394,012,959(22,140,004)(17,349,209)(39,489,214)354,523,744

Distributions of retained earnings
Reversal

Deductions from capital surplus

Unitholders’

Units

for

difference

adjustments
Distributions in excess of net
earnings from allowance fortemporary difference adjustments
Other distributions in excess of
net earnings
Net income
Net changes of items other thanunitholders' equity
Total changes of items during theperiodBalance as ofFebruary 28, 2023

Thousands of Yen
Valuation and Translation
Adjustments

Unitholders’ Equity
Surplus
Total unitholders'
Retained

Total surplus

earnings
Balance as ofequityDeferred gains
or losses on

Total

Total

valuation andnet assets

translation

hedgesadjustments

13,594,898

370,179,185

615,175,856(47,825)(47,825)

615,128,031

Distributions of retained earnings (13,499,617)(13,499,617)(13,499,617)——(13,499,617)(46,744)(46,744)

—

—

—

—

—

(1,900,225)(1,900,225)——(1,900,225)—(160,316)(160,316)——(160,316)

13,948,627

13,948,627

13,948,627——

13,948,627

—

—

—

23,98623,98623,986402,265(1,658,277)(1,611,532)

23,98623,986(1,587,545)

13,997,163

368,520,907

613,564,324(23,838)(23,838)

613,540,485

September 1, 2022

Reversal of
temporaryallowance fordifference

adjustments
Distributions in excess of net
earnings from allowance fortemporary difference adjustments
Other distributions in excess of
net earnings
Net income
Net changes of items other thanunitholders' equity
Total changes of items during theperiodBalance as ofFebruary 28, 2023

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

-8-

STATEMENT OF CASH FLOWS
Thousands of Yen
For the period
fromMarch 1, 2022
to August 31, 2022

For the period
from
September 1, 2022
to February 28, 2023

CASH FLOWSCash Flows from Operating Activities
Income before income taxes

13,501,429

13,950,584

Depreciation

5,738,951

5,673,877

Amortization of goodwill

2,622,242

2,622,242

Amortization of investment corporation bonds issuance
costs

7,984

7,984

Increase (Decrease) in provision for loss on disaster

17,332(17,332)

Interest income

(256)

(239)

Interest expense

1,751,404

1,701,918

Gain on donation of non-current assets(155,651)—

Loss on disposal of property and equipment

10,937

11,065Decrease (Increase) in rental receivables(181,561)

34,002

Decrease (Increase) in long-term prepaid expenses

99,397(34,861)

Decrease (Increase) in long-term deposits

91,080(15,499)

Increase (Decrease) in trade accounts payable

1,048,344(711,697)

Increase (Decrease) in other accounts payable

69,60058,827

Increase (Decrease) in accrued consumption taxes

833,204(127,195)

Increase (Decrease) in rent received in advance

29,416(34,099)

Decrease in property and equipment due to sales—

4,440,419

Decrease in property and equipment in trust due to sales

4,406,579

1,873,735

Other(33,983)(57,493)

29,856,452

29,376,241

256

239

(1,725,040)(1,736,247)(2,714)(2,124)

28,128,954

27,638,108

Payments for purchases of property and equipment(13,789,799)(3,812,897)

Payments for purchases of leasehold rights and intangible
assets(4,272,489)(4,051)

Reimbursement of security deposits to tenants(2,111,889)(1,635,765)

Proceeds from security deposits from tenants

2,284,292

1,606,363－

10,000(17,889,886)(3,836,350)

SubtotalInterest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities

Cash Flows from Investing Activities

Proceeds from security deposits
Net cash provided by (used in) investing activities

Thousands of Yen-9-For the period
fromMarch 1, 2022
to August 31, 2022

For the period
from
September 1, 2022
to February 28, 2023

Cash Flows from Financing Activities
Proceeds from long-term debt

24,730,000

33,550,000

Repayments of long-term debt

(25,022,800)(33,592,800)

Distributions to unitholders(12,373,419)(13,495,707)

Distributions in excess of net earnings from allowance fortemporary difference adjustments(2,093,294)(1,899,999)(825,004)(161,274)(15,584,517)(15,599,782)

Net Increase (Decrease) in Cash and Cash Equivalents(5,345,450)

8,201,975

Cash and Cash Equivalents at Beginning of Period

50,237,480

44,892,030

Cash and Cash Equivalents at End of Period

44,892,030

53,094,006

Other distributions in excess of net earnings
Net cash provided by (used in) financing activities

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

- 10 -NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
Nomura Real Estate Master Fund, Inc. (NMF) is a real estate investment corporation formed to own and invest primarily in officebuildings, retail facilities, logistics and residential facilities. NMF 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 was established on October 1, 2015 through the consolidation type merger involving 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 of the same year.
NMF adopts the basic policy of investing primarily in real estate and other assets to secure stable income and steady growth of assets
under management over the medium to long term. In order to realize this basic policy, NMF adopts an investment strategy that centerson 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 which investments are made in facilities of a variety of sectors such as office buildings, retailfacilities, logistics 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 with the utilization of the “leasing value chain” with the Nomura Real EstateGroup, the sponsor, NMF will aim to increase unitholder value by securing stable income and steady growth of assets undermanagement over the medium to long term.

2. BASIS OF PRESENTATION
NMF maintains its accounting records and prepares its financial statements in accordance with accounting principles generally
accepted in Japan (“Japanese GAAP”), including provisions set forth in the Investment Trust Act of Japan, the Companies Act ofJapan, the Financial Instruments and Exchange Act of Japan and related regulations, which are different in certain respects as to theapplication and disclosure requirements of International Financial Reporting Standards.
The accompanying financial statements are a translation of the audited financial statements of NMF, which were prepared inaccordance with Japanese GAAP and were presented in NMF’s Securities Report filed with the Kanto Local Finance Bureau. In
preparing the accompanying financial statements, certain reclassifications and modifications have been made to the financial
statements issued domestically in 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 thenotes thereto, whereas amounts were truncated in the Japanese financial statements prepared in accordance with Japanese GAAP.
NMF’s fiscal period is a six-month period which ends at the end of February or August. NMF 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 whenpurchased.
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

3 - 70 years
6- 45 years

Machinery and equipment
Tools, furniture and fixtures

6 - 17 years
2 - 20 years- 11 -

Intangible assets
Intangible assets are amortized by the straight-line method.
Goodwill is amortized using the straight-line method over 20 years.
Long-term prepaid expenses
Long-term prepaid expenses are amortized by the straight-line method.
Impairment of fixed assets
NMF 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 estimatedfuture cash flows. If a fixed asset is determined to be impaired, it is written down to its recoverable amount and the write-down isrecorded 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.
Investment units issuance expenses
The entire amount is expensed as incurred.
Allowances and provisions(1) Allowance for doubtful accounts
For allowance for doubtful accounts against possible losses arising from default on receivables, the uncollectable amount is estimatedand recorded by investigating collectability based on historical loan loss ratios for general receivables and on a case-by-caseexamination for doubtful and other specific receivables.
(2) Provision for loss on disaster
The amount that is reasonably estimated at the 15th fiscal period under review is recorded to cover expenditures for restoration etc.
following the 2021 Fukushima Earthquake.
Accounting treatment of beneficial interests in real estate
All assets and liabilities held in trust, for which the real estate in possession of NMF was entrusted, and all related earnings andexpenses incurred are reflected in the accompanying balance sheet and statement of income and retained earnings, respectively.
Property related taxes
Property in Japan is subject to property taxes, urban planning taxes and depreciable property taxes on a calendar year basis. The taxes
related to property are generally imposed based on the value of the relevant property and incurred for the fiscal period. The seller of aproperty is liable for property related taxes for the period from the purchase date through the end of that calendar year because taxes
are imposed on the owner registered in the record as of January 1 for the entire year based on the assessment made by the local
government. The amount applicable to the buyer of a property is usually settled between each party and capitalized as part of theacquisition cost of the property. The capitalized property related taxes amounted to ¥33,773 thousand for the fiscal period ended
August 31, 2022 and ¥3,372 thousand for the fiscal period ended February 28,2023.
Revenue recognition
Main performance obligations concerning revenues from contracts with NMF’s customers and normal points in time when the
obligations are satisfied (normal points in time when revenues are recognized) are as follows:(1) Disposition of real estate
Gains on sale of real estate are recorded at the points in time when customers or the buyers acquire control over the real estate by
NMF satisfying delivery obligations stipulated in the contracts on real estate disposition.
(2) Utility expense revenues
Utility expense revenues are recorded according to the supply of electricity, water, etc. to customers or the tenants based on the lease
contracts and attached agreements.
Among utility expense revenues, when NMF is acting as an agent in a transaction, it is NMF’s policy to recognize net amounts asrevenues after deducting the amounts paid to the suppliers of electricity, gas, etc. from the amounts NMF received as utility charges.

- 12 -

Income taxes
Deferred tax assets and liabilities are computed based on the differences between the financial statements and income tax bases ofassets and liabilities using the applicable statutory tax rates.
Method of accounting for non-deductible consumption tax, etc
Non-deductible consumption tax, etc., on such items, as noncurrent assets is included in the acquisition costs of individual items.
Derivative financial instruments
NMF utilizes interest-rate swap contracts as derivative financial instruments only for the purpose of hedging its exposure to changes ininterest rates. NMF defers recognition of gains or losses resulting from changes in the fair value of interest-rate swap contracts whichmeet the criteria for deferral hedge accounting.
Although deferral hedge accounting is generally applied, NMF applies the 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.

- 13 -

4. CASH AND CASH EQUIVALENTS
Cash and cash equivalents as of August 31, 2022 and February 28, 2023 consist of the following:Thousands of Yen
As of August 31, 2022

As of February 28, 2023

Cash and bank deposits

44,892,030

53,094,006

Cash and cash equivalents

44,892,030

53,094,006

Important contents of the non-cash transactions:Not applicable.

5. ASSETS PLEDGED AS COLLATERAL AND SECURED LIABILITIESThe assets pledged as collateral are as follows:
Thousands of Yen
As of August 31, 2022
Buildings in trust
Land in trust
Structures in trust
Tools, furniture and fixtures in trust

Total

As of February 28, 2023

3,169,322
6,096,368
5,040
2,938

3,124,950
6,096,368
4,919
2,556

9,273,670

9,228,794

The secured liabilities are as follows:
As of August 31, 2022
Tenant leasehold and security deposits in trust
Total- 14 -

Thousands of Yen
As of February 28, 2023

726,648

726,648

726,648

726,648

6. SCHEDULE OF PROPERTY AND EQUIPMENT
Property and equipment as of August 31, 2022 and February 28, 2023 consist of the following:Thousands of Yen
As of August 31, 2022
Acquisition costs
Land

320,813,765

Buildings and structures
Accumulated depreciation

164,995,500(28,293,125)

Machinery and equipment
Accumulated depreciation

1,124,449(663,494)

Tools, furniture and fixtures
Accumulated depreciation

As of February 28, 2023

Book value

Acquisition costs

320,813,765

136,702,374

Book value

317,181,103

317,181,103

161,782,722(29,727,232)

132,055,489

460,954

1,110,113(670,901)

439,211

666,985(347,263)

319,721719,399(377,569)

341,829

Land in trust

428,531,681

428,531,681

429,802,840

429,802,840

Buildings and structures in trust
Accumulated depreciation

208,585,101(42,893,560)

165,691,540

210,720,373(46,114,144)

164,606,228

Machinery and equipment in trust
Accumulated depreciation

1,155,749(350,362)

Tools, furniture and fixtures in trust
Accumulated depreciation

1,263,269(695,952)

567,317

1,318,751(789,171)

529,580

4,752(2,508)

2,244

4,752
(2,904)

1,848

Lease assets in trust
Accumulated depreciation
Construction in progress
Total

805,387

1,243,344(423,320)

820,024

54,30554,30555,572

55,572

1,053,949,292

1,053,949,292

1,045,833,729

1,045,833,729- 15 -

7. LONG-TERM DEBT
Long-term debts as of August 31, 2022 and February 28, 2023 consist of the following:
As of August 31, 2022

As of February 28, 2023

AmountWeighted-averageAmount(Thousands of Yen)

Weighted-average(Thousands of Yen)

interest rate (Note 1)

Unsecured loans from banks due on September 30, 2022

4,000,000

0.76250%--

Unsecured loans from banks due on October 26, 2022

3,000,000

0.25000%--

Unsecured loans from banks due on November 28, 2022

2,100,000

0.92280%--

Unsecured loans from banks due on November 28, 2022

4,550,000

1.11000%--

Unsecured loans from a bank due on November 28, 2022

1,800,000

1.05000%--

Unsecured loans from banks due on November 28, 2022

1,500,000

0.98624%--

Unsecured loans from a bank due on November 28, 2022

1,000,000

0.71221%--

Unsecured loans from banks due on November 28, 2022

1,500,000

0.69250%--

Unsecured loans from a bank due on February 27, 2023

1,300,000

1.13250%--

Unsecured loans from banks due on February 27, 2023

2,800,000

0.40740%--

Unsecured loans from banks due on February 28, 2023

10,000,000

0.48700%--

Unsecured loans from a bank due on May 26, 2023 (Note 2)

2,000,000

1.86500%

2,000,000

1.86500%

Unsecured loans from a bank due on May 26, 2023 (Note 2)

2,000,000

1.89500%

2,000,000

1.89500%

Unsecured loans from a bank due on May 26, 2023 (Note 2)

1,000,000

1.83875%

1,000,000

1.83875%

Unsecured loans from a bank due on May 26, 2023 (Note 2)

1,000,000

0.41250%

1,000,000

0.41250%

Unsecured loans from a bank due on May 26, 2023 (Note 2)

2,500,000

0.43408%2,500,000

0.43408%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

1,000,000

1.14850%

1,000,000

1.14850%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

1,000,000

1.15850%

1,000,000

1.15850%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

1,000,000

1.18032%

1,000,000

1.18032%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

4,000,000

1.20772%

4,000,000

1.20772%

Unsecured loans from banks due on August 28, 2023 (Note 2)

6,100,000

1.08510%

6,100,000

1.08510%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

1,000,000

0.43466%

1,000,000

0.43466%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

1,000,000

0.41000%

1,000,000

0.41000%

Unsecured loans from a bank due on August 28, 2023 (Note 2)

500,000

0.41435%

500,000

0.41435%

Unsecured loans from banks due on August 31, 2023 (Note 2)

6,700,000

0.55700%

6,700,000

0.55700%

Unsecured loans from banks due on September 26, 2023 (Note 2)

3,000,000

0.25000%

3,000,000

0.22182%

Unsecured loans from banks due on November 27, 2023 (Note 2)

2,000,000

1.75900%

2,000,000

1.75900%

Unsecured loans from banks due on November 27, 2023 (Note 2)

2,600,000

0.82800%

2,600,000

0.82800%

Unsecured loans from banks due on November 27, 2023 (Note 2)

4,000,000

0.49380%

4,000,000

0.49380%

Unsecured loans from banks due on November 27, 2023 (Note 2)

1,500,000

0.47483%

1,500,000

0.47483%

Unsecured loans from banks due on November 27, 2023 (Note 2)

1,230,000

0.25000%

1,230,000

0.22182%

Unsecured loans from a bank due on February 26, 2024 (Note 2)

2,750,000

1.59400%

2,750,000

1.59400%

Unsecured loans from banks due on February 26, 2024 (Note 2)

1,300,000

0.53630%

1,300,000

0.53630%

Unsecured loans from a bank due on February 26, 2024 (Note 2)

500,0000.24000%

500,0000.24000%

Unsecured loans from a bank due on February 26, 2024 (Note 2)

1,000,000

0.18500%

1,000,000

0.18500%

Unsecured loans from banks due on February 26, 2024 (Note 2)

4,670,000

0.25000%

4,670,000

0.22182%

Unsecured loans from banks due on May 27, 2024

1,100,000

0.51000%

1,100,000

0.51000%

Unsecured loans from a bank due on May 27, 2024

2,700,000

0.46376%

2,700,000

0.46376%

Unsecured loans from a bank due on May 27, 2024

2,000,000

0.53676%

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%

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 August 26, 2024

3,000,000

0.58175%

3,000,000

0.58175%

Unsecured loans from a bank due on August 26, 2024

2,430,000

0.49971%2,430,000

0.49971%

Unsecured loans from banks due on August 26, 2024

5,670,000

0.49485%

5,670,000

0.49485%

Unsecured loans from a bank due on August 26, 2024

1,000,000

0.28624%

1,000,000

0.28624%- 16 -

interest rate (Note 1)

As of August 31, 2022

As of February 28, 2023

AmountWeighted-averageAmountWeighted-average(Thousands of Yen)

interest rate (Note 1)(Thousands of Yen)

interest rate (Note 1)

Unsecured loans from a bank due on November 26, 2024

2,250,000

0.50825%

2,250,000

0.50825%

Unsecured loans from banks due on November 26, 2024

3,000,000

0.58000%

3,000,000

0.58000%

Unsecured loans from a bank due on November 26, 2024

1,800,000

0.55979%

1,800,000

0.55979%

Unsecured loans from a bank due on November 26, 2024

500,000

0.52384%

500,000

0.52384%

Unsecured loans from banks due on November 26, 2024

2,000,000

0.42630%

2,000,000

0.42630%

Unsecured loans from a bank due on November 26, 2024

800,000

0.21380%

800,000

0.21380%

Unsecured loans from banks due on November 26, 2024

6,375,000

0.25000%

6,375,000

0.22182%

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 February 26, 2025

1,000,000

0.52140%

1,000,000

0.52140%

Unsecured loans from banks due on February 26, 2025

3,000,000

0.53936%3,000,000

0.53936%

Unsecured loans from banks due on February 26, 2025

1,500,000

0.53880%

1,500,000

0.53880%

Unsecured loans from banks due on February 26, 2025

1,000,000

0.50604%

1,000,000

0.50604%

Unsecured loans from a bank due on May 26, 2025

2,000,000

0.60286%2,000,000

0.60286%

Unsecured loans from a bank due on May 26, 2025

2,000,000

0.60286%2,000,000

0.60286%

Unsecured loans from banks due on May 26, 2025

2,800,000

0.60286%

2,800,000

0.60286%

Unsecured loans from a bank due on May 26, 2025

1,000,000

0.61434%

1,000,000

0.61434%

Unsecured loans from a bank due on May 26, 2025

1,000,000

0.50506%

1,000,000

0.50506%

Unsecured loans from banks due on May 26, 2025

2,000,000

0.46301%2,000,000

0.46301%

Unsecured loans from a bank due on May 26, 2025

1,000,000

0.19750%

1,000,000

0.19750%

Unsecured loans from banks due on May 26, 2025

4,000,000

0.25000%

4,000,000

0.22182%

Unsecured loans from banks due on August 26, 2025

3,000,000

0.56380%

3,000,000

0.56380%

Unsecured loans from banks due on August 26, 2025

4,050,000

0.58727%

4,050,000

0.58727%

Unsecured loans from banks due on August 26, 2025

1,850,000

0.67915%1,850,000

0.67915%

Unsecured loans from banks due on August 26, 2025

2,600,000

0.60489%

2,600,000

0.60489%

Unsecured loans from banks due on August 26, 2025

3,000,000

0.58380%

3,000,000

0.58380%

Unsecured loans from banks due on August 26, 2025--

4,000,000

0.22182%

Unsecured loans from banks due on August 26, 2025--

3,000,000

0.22182%

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 November 26, 2025

1,100,000

1.06250%

1,100,000

1.06250%

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 November 26, 2025

2,000,000

0.59639%2,000,000

0.59639%

Unsecured loans from a bank due on November 26, 2025

2,000,000

0.60448%2,000,000

0.60448%

Unsecured loans from banks due on November 26, 2025

4,200,000

0.64616%

4,200,000

0.64616%

Unsecured loans from a bank due on November 26, 2025

900,000

0.65123%900,000

0.65123%

Unsecured loans from a bank due on November 26, 2025

1,300,000

0.64278%

1,300,000

0.64278%

Unsecured loans from a bank due on November 26, 2025

1,000,000

0.59499%

1,000,000

0.59499%

Unsecured loans from a bank due on November 26, 2025

500,000

0.56311%500,000

0.56311%

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 February 26, 2026

2,500,000

0.59592%

2,500,000

0.59592%

Unsecured loans from banks due on February 26, 2026

800,000

0.37630%

800,000

0.37630%

Unsecured loans from a bank due on February 26, 2026

500,000

0.39196%

500,000

0.39196%

Unsecured loans from banks due on February 26, 2026

1,500,000

0.17136%

1,500,000

0.17136%

Unsecured loans from a bank due on February 26, 2026

500,000

0.21500%

500,000

0.21500%

Unsecured loans from a bank due on February 26, 2026--

1,800,000

0.20773%

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 May 26, 2026

1,100,000

0.65267%

1,100,000

0.65267%

Unsecured loans from banks due on May 26, 2026

3,600,000

0.60880%

3,600,000

0.60880%

Unsecured loans from a bank due on May 26, 2026

1,000,000

0.59614%1,000,000

0.59614%- 17 -

As of August 31, 2022

As of February 28, 2023

AmountWeighted-averageAmountWeighted-average(Thousands of Yen)

interest rate (Note 1)(Thousands of Yen)

interest rate (Note 1)

Unsecured loans from a bank due on May 26, 2026

1,100,000

0.37000%

1,100,000

0.37000%

Unsecured loans from a bank due on May 26, 2026

1,500,000

0.25873%

1,500,000

0.25873%

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 August 26, 2026

2,700,000

0.67591%2,700,000

0.67591%

Unsecured loans from banks due on August 26, 2026

3,000,000

0.77669%

3,000,000

0.77669%

Unsecured loans from a bank due on August 26, 2026

1,000,000

0.70414%1,000,000

0.70414%

Unsecured loans from banks due on August 26, 2026

3,000,000

0.67483%

3,000,000

0.67483%

Unsecured loans from a bank due on August 26, 2026

1,000,000

0.64500%

1,000,000

0.64500%

Unsecured loans from a bank due on August 26, 2026

1,000,000

0.42118%

1,000,000

0.42118%

Unsecured loans from a bank due on August 26, 2026

500,000

0.43627%

500,000

0.43627%

Unsecured loans from banks due on August 26, 2026

1,500,000

0.20880%

1,500,000

0.20880%

Unsecured loans from a bank due on August 26, 2026

1,000,000

0.30116%

1,000,000

0.30116%

Unsecured loans from a bank due on November 26, 2026

2,000,000

0.76000%

2,000,000

0.76000%

Unsecured loans from a bank due on November 26, 2026

2,000,000

0.74229%2,000,000

0.74229%

Unsecured loans from banks due on November 26, 2026

4,165,000

0.73506%

4,165,000

0.73506%

Unsecured loans from banks due on November 26, 2026

4,000,000

0.69956%

4,000,000

0.69956%

Unsecured loans from banks due on November 26, 2026

1,500,000

0.64999%

1,500,000

0.64999%

Unsecured loans from banks due on November 26, 2026

2,000,000

0.60750%

2,000,000

0.60750%

Unsecured loans from banks due on November 26, 2026

1,000,000

0.28000%

1,000,000

0.28000%

Unsecured loans from banks due on November 26, 2026

1,200,000

0.30000%

1,200,000

0.30000%

Unsecured loans from banks due on February 26, 2027

2,320,000

0.71500%

2,320,000

0.71500%

Unsecured loans from banks due on February 26, 2027

1,500,000

0.46630%

1,500,000

0.46630%

Unsecured loans from a bank due on February 26, 2027

500,000

0.44859%

500,000

0.44859%

Unsecured loans from banks due on February 26, 2027

1,000,000

0.48144%

1,000,000

0.48144%

Unsecured loans from a bank due on February 26, 2027

1,500,000

0.28500%

1,500,000

0.28500%

Unsecured loans from a bank due on February 26, 2027

1,000,000

0.28500%

1,000,000

0.28500%

Unsecured loans from a bank due on February 26, 2027

300,000

0.16205%

300,000

0.16205%

Unsecured loans from a bank due on February 26, 2027

500,000

0.10094%

500,000

0.10094%

Unsecured loans from a bank due on February 26, 2027

500,000

0.35139%

500,000

0.35139%

Unsecured loans from a bank due on February 26, 2027

500,000

0.24818%

500,000

0.24818%

Unsecured loans from a bank due on February 26, 2027

1,000,000

0.29065%

1,000,000

0.29065%

Unsecured loans from banks due on March 26, 2027

1,500,000

0.69068%

1,500,000

0.69068%

Unsecured loans from banks due on May 26, 2027

3,060,000

0.78177%

3,060,000

0.78177%

Unsecured loans from banks due on May 26, 2027

2,300,000

0.74736%2,300,000

0.74736%

Unsecured loans from a bank due on May 26, 2027

1,800,000

0.70250%

1,800,000

0.70250%

Unsecured loans from a bank due on May 26, 2027

1,400,000

0.32000%

1,400,000

0.32000%

Unsecured loans from banks due on August 26, 2027

4,000,000

0.76843%

4,000,000

0.76843%

Unsecured loans from banks due on August 26, 2027

2,600,000

0.76290%

2,600,000

0.76290%

Unsecured loans from a bank due on August 26, 2027

1,000,000

0.74500%

1,000,000

0.74500%

Unsecured loans from a bank due on August 26, 2027

1,000,000

0.51356%

1,000,000

0.51356%

Unsecured loans from banks due on August 26, 2027

1,500,000

0.29000%

1,500,000

0.29000%

Unsecured loans from a bank due on August 26, 2027

600,000

0.32630%

600,000

0.32630%

Unsecured loans from a bank due on August 26, 2027

1,700,000

0.27130%

1,700,000

0.27130%

Unsecured loans from a bank due on August 26, 2027

1,780,000

0.46190%

1,780,000

0.46190%

Unsecured loans from a bank due on November 26, 2027

2,000,000

0.89209%2,000,000

0.89209%

Unsecured loans from banks due on November 26, 2027

5,000,000

0.79571%

5,000,000

0.79571%

Unsecured loans from a bank due on November 26, 2027

1,800,000

0.75050%

1,800,000

0.75050%- 18 -

As of August 31, 2022

As of February 28, 2023

AmountWeighted-averageAmountWeighted-average(Thousands of Yen)

interest rate (Note 1)(Thousands of Yen)

interest rate (Note 1)

Unsecured loans from banks due on November 26, 2027

1,700,000

0.70750%

1,700,000

0.70750%

Unsecured loans from banks due on November 26, 2027

2,500,000

0.52234%

2,500,000

0.52234%

Unsecured loans from banks due on November 26, 2027

1,000,000

0.31630%

1,000,000

0.31630%

Unsecured loans from a bank due on November 26, 2027

750,000

0.29630%750,000

0.29630%

Unsecured loans from a bank due on February 28, 2028

1,000,000

0.82130%

1,000,000

0.82130%

Unsecured loans from a bank due on February 28, 2028

2,355,000

0.76241%

2,355,000

0.76241%

Unsecured loans from banks due on February 28, 2028

1,500,000

0.78296%

1,500,000

0.78296%

Unsecured loans from a bank due on February 28, 2028

1,800,000

0.79642%1,800,000

0.79642%

Unsecured loans from a bank due on February 28, 2028

2,650,000

0.54205%2,650,000

0.54205%

Unsecured loans from banks due on February 28, 2028

1,500,000

0.57365%

1,500,000

0.57365%

Unsecured loans from banks due on February 28, 2028

1,000,000

0.17813%1,000,000

0.17813%

Unsecured loans from a bank due on February 28, 2028

1,000,000

0.41000%

1,000,000

0.41000%

Unsecured loans from a bank due on February 28, 2028

1,000,000

0.41000%

1,000,000

0.41000%

Unsecured loans from a bank due on February 28, 2028

500,000

0.39000%

500,000

0.39000%

Unsecured loans from a bank due on February 28, 2028

920,000

0.30000%

920,000

0.30000%

Unsecured loans from a bank due on February 28, 2028

1,000,000

0.47023%

1,000,000

0.47023%

Unsecured loans from banks due on May 26, 2028

5,000,000

0.79880%

5,000,000

0.79880%

Unsecured loans from a bank due on May 26, 2028

2,000,000

0.75922%2,000,000

0.75922%

Unsecured loans from a bank due on May 26, 2028

1,550,000

0.55038%

1,550,000

0.55038%

Unsecured loans from a bank due on May 26, 2028

500,000

0.54010%500,000

0.54010%

Unsecured loans from banks due on May 26, 2028

2,000,000

0.54750%

2,000,000

0.54750%

Unsecured loans from a bank due on May 26, 2028

1,400,000

0.40500%

1,400,000

0.40500%

Unsecured loans from banks due on August 28, 2028

3,600,000

0.84750%

3,600,000

0.84750%

Unsecured loans from a bank due on August 28, 2028

500,000

0.61005%

500,000

0.61005%

Unsecured loans from banks due on August 28, 2028

1,000,000

0.62163%

1,000,000

0.62163%

Unsecured loans from a bank due on August 28, 2028

500,000

0.62025%500,000

0.62025%

Unsecured loans from a bank due on August 28, 2028

500,000

0.37500%

500,000

0.37500%

Unsecured loans from a bank due on August 28, 2028

1,000,000

0.40380%

1,000,000

0.40380%

Unsecured loans from a bank due on August 28, 2028

1,260,000

0.45375%

1,260,000

0.45375%

Unsecured loans from banks due on November 27, 2028

2,000,000

0.81130%

2,000,000

0.81130%

Unsecured loans from banks due on November 27, 2028

3,000,000

0.59375%

3,000,000

0.59375%

Unsecured loans from a bank due on November 27, 2028

1,800,000

0.50880%

1,800,000

0.50880%

Unsecured loans from a bank due on November 27, 2028

500,000

0.39380%

500,000

0.39380%

Unsecured loans from a bank due on November 27, 2028

1,000,000

0.40630%

1,000,000

0.40630%

Unsecured loans from banks due on February 26, 2029

2,500,000

0.65880%

2,500,000

0.65880%

Unsecured loans from banks due on February 26, 2029

1,400,000

0.67098%

1,400,000

0.67098%

Unsecured loans from a bank due on February 26, 2029

2,300,000

0.63692%

2,300,000

0.63692%

Unsecured loans from a bank due on February 26, 2029

500,000

0.63692%

500,000

0.63692%

Unsecured loans from a bank due on February 26, 2029

3,500,000

0.41815%3,500,000

0.41815%

Unsecured loans from a bank due on February 26, 2029

500,000

0.37000%

500,000

0.37000%

Unsecured loans from a bank due on February 26, 2029

500,000

0.49750%

500,000

0.49750%

Unsecured loans from a bank due on February 26, 2029

1,500,000

0.55565%

1,500,000

0.55565%

Unsecured loans from a bank due on February 26, 2029--

1,800,000

0.90134%

Unsecured loans from banks due on May 28, 2029

5,000,000

0.64000%

5,000,000

0.64000%

Unsecured loans from a bank due on May 28, 2029

800,000

0.55190%

800,000

0.55190%

Unsecured loans from a bank due on May 28, 2029

500,000

0.26451%

500,000

0.26451%

Unsecured loans from a bank due on May 28, 2029

1,000,000

0.45875%

1,000,000

0.45875%

Unsecured loans from a bank due on May 28, 2029

1,000,000

0.44880%

1,000,000

0.44880%- 19 -

As of August 31, 2022

As of February 28, 2023

AmountWeighted-averageAmountWeighted-average(Thousands of Yen)

interest rate (Note 1)(Thousands of Yen)

interest rate (Note 1)

Unsecured loans from banks due on May 28, 2029

1,000,000

0.38500%

1,000,000

0.38500%

Unsecured loans from banks due on August 27, 2029

3,900,000

0.46130%

3,900,000

0.46130%

Unsecured loans from banks due on August 27, 2029

2,000,000

0.46130%

2,000,000

0.46130%

Unsecured loans from banks due on August 27, 2029

2,800,000

0.55845%2,800,000

0.55845%

Unsecured loans from banks due on August 27, 2029

1,600,000

0.48380%

1,600,000

0.48380%

Unsecured loans from a bank due on August 27, 2029

1,500,000

0.48380%

1,500,000

0.48380%

Unsecured loans from a bank due on August 27, 2029

500,000

0.46380%

500,000

0.46380%

Unsecured loans from banks due on August 27, 2029

1,000,000

0.43880%

1,000,000

0.43880%

Unsecured loans from a bank due on August 27, 2029

1,800,000

0.40500%

1,800,000

0.40500%

Unsecured loans from banks due on August 27, 2029

1,250,000

0.64565%

1,250,000

0.64565%

Unsecured loans from a bank due on August 27, 2029--

500,000

0.98711%

Unsecured loans from a bank due on November 26, 2029

2,000,000

1.12506%

2,000,000

1.12506%

Unsecured loans from a bank due on November 26, 2029

2,000,000

1.12506%

2,000,000

1.12506%

Unsecured loans from a bank due on November 26, 2029

1,200,000

0.59500%

1,200,000

0.59500%

Unsecured loans from a bank due on November 26, 2029

1,000,000

0.59500%

1,000,000

0.59500%

Unsecured loans from a bank due on November 26, 2029

750,000

0.48000%

750,000

0.48000%

Unsecured loans from a bank due on November 26, 2029

500,000

0.59500%

500,000

0.59500%

Unsecured loans from a bank due on November 26, 2029

2,000,000

0.50630%

2,000,000

0.50630%

Unsecured loans from a bank due on November 26, 2029

750,000

0.47380%750,000

0.47380%

Unsecured loans from banks due on November 26, 2029

4,000,000

0.54904%

4,000,000

0.54904%

Unsecured loans from banks due on February 26, 2030

4,250,000

0.52000%

4,250,000

0.52000%

Unsecured loans from a bank due on February 26, 2030

1,500,000

0.48000%

1,500,000

0.48000%

Unsecured loans from a bank due on February 26, 2030

600,000

0.40915%600,000

0.40915%

Unsecured loans from a bank due on February 26, 2030

500,000

0.34054%500,000

0.34054%

Unsecured loans from banks due on February 26, 2030

1,300,000

0.59482%

1,300,000

0.59482%

Unsecured loans from a bank due on February 26, 2030

1,500,000

0.52446%

1,500,000

0.52446%

Unsecured loans from a bank due on February 26, 2030

1,400,000

0.58630%

1,400,000

0.58630%

Unsecured loans from a bank due on February 26, 2030

1,000,000

0.58630%

1,000,000

0.58630%

Unsecured loans from a bank due on February 26, 2030

1,000,000

0.65249%

1,000,000

0.65249%

Unsecured loans from a bank due on February 26, 2030--

1,300,000

1.04887%

7,000,000

0.54630%

7,000,000

0.54630%

Unsecured loans from a bank due on May 27, 2030

800,000

0.52630%

800,000

0.52630%

Unsecured loans from a bank due on May 27, 2030

1,000,000

0.53250%

1,000,000

0.53250%

Unsecured loans from a bank due on May 27, 2030

1,000,000

0.55988%

1,000,000

0.55988%

Unsecured loans from a bank due on May 27, 2030

500,000

0.50485%

500,000

0.50485%

Unsecured loans from a bank due on May 27, 2030

720,000

0.59399%

720,000

0.59399%

Unsecured loans from a bank due on May 27, 2030

1,430,000

0.45862%

1,430,000

0.45862%

Unsecured loans from a bank due on May 27, 2030

1,000,000

0.52437%

1,000,000

0.52437%

Unsecured loans from a bank due on May 27, 2030

1,000,000

0.71487%

1,000,000

0.71487%

Unsecured loans from a bank due on May 27, 2030

1,000,000

0.71487%

1,000,000

0.71487%

Unsecured loans from banks due on May 27, 2030

Unsecured loans from a bank due on May 27, 2030--

550,000

0.83509%

Unsecured loans from banks due on August 26, 2030

2,000,000

0.56500%

2,000,000

0.56500%

Unsecured loans from a bank due on August 26, 2030

1,100,000

0.54500%

1,100,000

0.54500%

Unsecured loans from a bank due on August 26, 2030

300,000

0.54500%

300,000

0.54500%

Unsecured loans from banks due on August 26, 2030

500,000

0.52063%

500,000

0.52063%

Unsecured loans from a bank due on August 26, 2030

1,000,000

0.46000%

1,000,000

0.46000%

Unsecured loans from a bank due on August 26, 2030

1,000,000

0.56068%

1,000,000

0.56068%

Unsecured loans from banks due on August 26, 2030

2,000,000

0.75160%

2,000,000

0.75160%- 20 -

As of August 31, 2022
AmountAs of February 28, 2023

Weighted-average(Thousands of Yen)

Weighted-average(Thousands of Yen)

interest rate (Note 1)--

2,300,000

1.13867%

Unsecured loans from a bank due on October 28, 2030

1,100,000

1.92250%

1,100,000

1.92250%

Unsecured loans from a bank due on October 28, 2030

1,100,000

1.91700%

1,100,000

1.91700%

Unsecured loans from a bank due on November 26, 2030

350,000

0.42630%

350,000

0.42630%

Unsecured loans from a bank due on November 26, 2030

500,000

0.53630%

500,000

0.53630%

Unsecured loans from a bank due on November 26, 2030

2,000,000

0.59763%2,000,000

0.59763%

Unsecured loans from a bank due on November 26, 2030

1,000,000

0.59819%

1,000,000

0.59819%

Unsecured loans from banks due on November 26, 2030--

2,000,000

0.89535%

Unsecured loans from a bank due on February 26, 2031

700,000

0.67750%700,000

0.67750%

Unsecured loans from a bank due on February 26, 2031

2,000,000

0.67750%

2,000,000

0.67750%

Unsecured loans from banks due on February 26, 2031

4,000,000

0.67750%

4,000,000

0.67750%

Unsecured loans from a bank due on February 26, 2031

400,000

0.50000%

400,000

0.50000%

Unsecured loans from a bank due on February 26, 2031

420,000

0.65750%

420,000

0.65750%

Unsecured loans from a bank due on February 26, 2031

2,750,000

0.50226%

2,750,000

0.50226%

Unsecured loans from a bank due on February 26, 2031

1,800,000

0.52198%

1,800,000

0.52198%

Unsecured loans from a bank due on February 26, 2031

2,500,000

0.78474%

2,500,000

0.78474%

Unsecured loans from a bank due on February 26, 2031--

1,300,000

1.21160%

Unsecured loans from banks due on February 26, 2031--

2,050,000

1.19239%

Unsecured loans from a bank due on February 26, 2031--

1,000,000

1.19239%

Unsecured loans from banks due on May 26, 2031

6,000,000

0.64130%

6,000,000

0.64130%

Unsecured loans from a bank due on May 26, 2031

3,500,000

0.64242%3,500,000

0.64242%

Unsecured loans from a bank due on May 26, 2031

1,000,000

0.60556%

1,000,000

0.60556%

Unsecured loans from banks due on August 26, 2030

Unsecured loans from banks due on May 26, 2031
Unsecured loans from a bank due on August 26, 2031

interest rate (Note 1)

Amount--1,000,000

0.95338%3,500,000

0.78816%

3,500,000

0.78816%

Unsecured loans from banks due on August 26, 2031

200,000

0.85750%

200,000

0.85750%

Unsecured loans from a bank due on November 26, 2031

3,000,000

0.64630%

3,000,000

0.64630%

Unsecured loans from a bank due on November 26, 2031

1,900,000

0.47755%

1,900,000

0.47755%

Unsecured loans from a bank due on November 26, 2031

3,500,000

0.73988%

3,500,000

0.73988%

Unsecured loans from a bank due on November 26, 2031

1,500,000

0.88168%

1,500,000

0.88168%

Unsecured loans from a bank due on November 26, 2031--

1,500,000

1.01250%

Unsecured loans from a bank due on November 26, 2031--

500,000

1.01250%

Unsecured loans from banks due on February 26, 2032

6,250,000

0.83563%

6,250,000

0.83563%

Unsecured loans from banks due on February 26, 2032--

2,050,000

1.32480%

Unsecured loans from banks due on May 26, 2032

4,000,000

0.93188%

4,000,000

0.93188%

Unsecured loans from banks due on May 26, 2032

2,000,000

0.92006%

2,000,000

0.92006%

Unsecured loans from a bank due on May 26, 2032

500,000

0.92006%

500,000

0.92006%--

1,500,000

1.07101%1,000,000

0.91688%

1,000,000

0.91688%

Unsecured loans from banks due on May 26, 2032
Unsecured loans from a bank due on August 26, 2032
Unsecured loans from banks due on November 26, 2032
Unsecured loans from a bank due on May 26, 2025 (Note 3)
Unsecured loans from a bank due on May 26, 2025 (Note 3)
Total

-

-

5,400,000

1.13063%

604,100

2.17000%

582,700

2.17000%

604,100

2.21812%582,700

2.21812%

485,463,200

485,420,400

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 for the borrowings, 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 interest rate.
Note 2: At the end of the period, these loans are accounted for under current liabilities on the balance sheets as the current portion of long-term borrowings.
Note 3: 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.

- 21 -

The scheduled repayment amounts of long-term debt for each of the five years after the balance sheet date are as follows.
Thousands of Yen
Within a year

1-2 years

2-3 years

3-4 years

4-5 years

As of August 31, 2022

64,435,600

47,935,600

58,762,000

54,100,000

52,725,000

As of February 28, 2023

55,435,600

50,810,600

65,994,200

56,685,000

55,215,000(1) The Company entered into ¥10,000 million of credit facilities in the form of commitment lines with two financial institutions forthe fiscal period ended August 31, 2022. The total unused amount of such credit facilities was ¥10,000 million as of August 31, 2022.
(2) The Company entered into ¥40,000 million of credit facilities in the form of commitment lines with four financial institutions forthe fiscal period ended August 31, 2022. The total unused amount of such credit facilities was ¥40,000 million as of August 31, 2022.
(3) The Company entered into ¥10,000 million of credit facilities in the form of commitment lines with two financial institutions forthe fiscal period ended February 28, 2023. The total unused amount of such credit facilities was ¥10,000 million as of February 28,
2023.
(4) The Company entered into ¥40,000 million of credit facilities in the form of commitment lines with four financial institutions forthe fiscal period ended February 28, 2023. The total unused amount of such credit facilities was ¥40,000 million as of February 28,
2023.

- 22 -

8. INVESTMENT CORPORATION BONDS
Details of investment corporation bonds outstanding are summarized as follows.
As of August 31, 2022
Amount(Thousands of Yen)

As of February 28, 2023

Interest rate
(Note 1)

Amount(Thousands of Yen)

Interest rate
(Note 1)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%

NMF's 2nd series of unsecured investment
corporation bonds due on November 16,
2027

2,000,000

0.59%

2,000,000

0.59%

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

4,500,000

2.90%

4,500,000

2.90%

NMF's 4th series of unsecured investment
corporation bonds due on September 20,2029(green bonds)

3,000,000

0.53%

3,000,000

0.53%

NMF's 6th series of unsecured investment
corporation bonds due on August 14,2030(green bonds)

7,000,000

0.54%

7,000,000

0.54%

NMF's 3rd series of unsecured investment
corporation bonds due on May 21, 2038

1,500,000

1.03%

1,500,000

1.03%

NMF's 5th series of unsecured investment
corporation bonds due on September 20,
2039

5,000,000

0.90%

5,000,000

0.90%

32,000,000

Total

32,000,000

Note 1: The interest rate is rounded to the nearest second decimal place.

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
Within a year

1-2 years

As of August 31, 2022——

As of February 28, 2023—

9,000,000

2-3 years

3-4 years

4-5 years

9,000,000

—

—

—

—

2,000,000

9. UNITHOLDERS’ EQUITY
NMF 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. NMF is required to maintain net assets of at least ¥50,000 thousand as set forth in theInvestment Trust Act.

- 23 -

10. ALLOWANCE FOR TEMPORARY DIFFERENCE ADJUSTMENTS
The movement in the allowance for temporary difference adjustments on the Balance Sheet was as follows:
For the period from March 1, 2022 to August 31, 2022
1. Reason, related assets and amounts
Thousands of Yen
Related assets,

Reasonetc.

Amortization of

Goodwill

goodwill

Land, buildings,

Merger expenses

etc.

Balance at the

Allowance set

end of previous

aside during

periodperiod27,844,826

16,792,199

2,106,124—

18,898,324—

4,029,135

1,306,205(12,575)—

1,293,629—

Initial amount

Reversal during
periodBalance at theend of current
periodLoss on interest-rate

Deferred gains

swaps recognized ator losses on

the end of the fiscal
periodhedgesIncrease subtotal
Total

Reason forreversal

Changes in fairvalue of2,867,594

197,332—(102,762)

94,570—18,295,737

2,093,548(102,762)

20,286,524——

18,295,737

2,093,548(102,762)

20,286,524—

derivativetransactions

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.

(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 bereversed.

- 24 -

For the period from September 1, 2022 to February 28, 2023
1. Reason, related assets and amounts
Thousands of Yen
Related assets,

Reasonetc.

Amortization of

Goodwill

goodwill

Land, buildings,

Merger expenses

etc.

Loss on interest-rate
swaps recognized atDeferred gains
or losses on

the end of the fiscal

hedgesBalance at the

Allowance set

end of previous

aside during

periodperiod30,467,068

18,898,324

1,914,452—

20,812,776—

4,029,135

1,293,629(14,226)—

1,279,402—

Initial amount

2,867,594

94,570

Reversal during
period—Balance at theend of current
period(46,744)

47,825

periodIncrease subtotal
Total

Reason forreversal

Changes in fairvalue ofderivativetransactions—

20,286,524

1,900,225(46,744)

22,140,004——

20,286,524

1,900,225(46,744)

22,140,004—

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.

(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 bereversed.

- 25 -

11. PER UNIT INFORMATIONThe net asset values per unit and the net income per unit as of August 31, 2022 and February 28, 2023 were as follows:
For the period
from March 1, 2022
to August 31, 2022

For the period
from September 1, 2022
to February 28, 2023

Net assets per unit

130,456

130,119

Net income per unit

2,862

2,958

Note 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.

For the period
from March 1, 2022
to August 31, 2022
13,499,309

Net income (Thousands of Yen)
Amount not available to ordinary unitholders (Thousandsof Yen)Net income available to ordinary unitholders (Thousandsof Yen)For the period
from September 1, 2022
to February 28, 2023
13,948,627—

Average number of units during the period (Units)—
13,499,309

13,948,627

4,715,200

4,715,200

12. RELATED PARTY TRANSACTIONS
For the periods from March 1, 2022 to August 31, 2022 and from September 1, 2022 to February 28, 2023
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- 26 -

13. INCOME TAXESThe Company, as an investment corporation, is subject to corporate income taxes at a statutory tax rate of approximately 31.46% for
the fiscal period ended February 28, 2023. 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 Taxationof Japan. Under this act, an investment corporation must meet a number of tax requirements, including a requirement to distribute inexcess of 90% of its distributable income for the fiscal period, in order to deduct such amounts. If the investment corporation does notsatisfy 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 ¥15,616,742
thousand for the fiscal period ended February 28, 2023 such distributions were treated as deductible distributions for purposes ofcorporate income taxes.
The following summarizes breakdown of deferred tax assets and liabilities:
Thousands of Yen
For the period
from March 1, 2022
to August 31, 2022

For the period
from September 1, 2022
to February 28, 2023

Deferred tax asset:
Valuation difference on other assets acquired by merger

19,107,665

18,774,841

Deferred gains or losses on hedges

15,046

7,499

Unearned revenue

4,673

2,424

Write-offs for long-term prepaid expenses

297

192

Depreciation costs of trust leasehold rights

2,067

2,189

91

78

6,408

6,408

Subtotal

19,136,250

18,793,633

Valuation allowance(19,136,250)(18,793,633)

Non-deductible accrued enterprise tax
Provision for loss on disaster

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

—

—

—

—

—

—

The following summarizes the significant differences between the statutory tax rate and the effective tax rate.
For the period
from March 1, 2022
to August 31, 2022

For the period
from September 1, 2022
to February 28, 2023

Statutory tax rate

31.46％

31.46％

Deductible cash distributions(35.88％)(34.96％)

Valuation of allowance(1.68％)(2.40％)

Amortization of goodwill

6.11％

5.91％

Other

0.00％

0.00％

Effective tax rate

0.02％

0.01％

- 27 -

14. 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,
issuance of investment corporation bonds and issuance of investment units. In financing through interest-bearing debt, to securestable financing capability and reduce future risks of rising interest rates, the Company’s investment policy is to secure longer-term,
fixed-rate borrowings with well-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.
(2) Type and Risk of Financial Instruments and Related Risk Management
Borrowings and investment corporation bonds are primarily used to fund the acquisition of property-related assets as well as therepayment of debts and redemption of investment corporation bonds. The Company is exposed to liquidity risk of being unable tomeet its obligations on scheduled due dates. The Company controls and limits such risk by diversifying not only the financial
institutions, but also the type of financing 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 debt. However, the effect of such 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 debt to total 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 debt by
swapping such floating-rate interest payments for fixed-rate interest payments.
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 priceavailable, fair value is reasonably estimated. Certain assumptions are used for the estimation of fair value. Accordingly, the result ofsuch estimation may change if different assumptions are used. Furthermore, the contractual amounts of derivative transactions
stated in “23. Derivatives and Hedge Accounting” below do not represent the market risk involved in these derivative transactions.
Fair Value of Financial Instruments
For the period from March 1, 2022 to August 31, 2022
Carrying amount, fair value and the difference between the two as of August 31, 2022 are as follows.
"Cash and bank deposits," "Cash and bank deposits in trust," and "Short-term debt" approximate their carrying amounts due to cash
and short term settlements, therefore, notes are omitted.
Thousands of Yen
Carrying value (Note 1)

Fair value (Note 1)

Difference(i) Current portion of long-term debt

(64,435,600)(64,628,258)

192,658(ii)Investment corporation bonds(32,000,000)(31,863,945)(136,055)(iii)Long-term debt

(421,027,600)(421,832,949)

805,349(48,676)(48,676)(iv) Derivative transactions—

For the period from September 1, 2022 to February 28, 2023
Carrying amount, fair value and the difference between the two as of February 28, 2023 are as follows.
"Cash and bank deposits," "Cash and bank deposits in trust," and "Short-term debt" approximate their carrying amounts due to cash
and short term settlements, therefore, notes are omitted.
Thousands of Yen
Carrying value (Note 1)

Fair value (Note 1)

Difference(i) Current portion of long-term debt

(55,435,600)(55,577,798)

142,198(ii)Investment corporation bonds(32,000,000)(31,226,278)(773,721)(iii)Long-term debt

(429,984,800)(425,564,669)(23,959)(23,959)(iv) Derivative transactions- 28 -(4,420,130)—

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
As these items are settled within a short-term period, their fair value is nearly equal to the carrying value. Therefore, for these items, thecarrying value is reported as the fair value.
(ii) 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 the market interest rates within a short-term period. (However, the fair value of certain floating-rate long-term debt that qualifies for the
special treatment of interest-rate swaps (see “23. Derivatives and Hedge Accounting”) is determined by discounting the sum of its principal andinterest 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 is determined by discounting the sum of its principal and interest payments at a rate reasonably
estimated to be applicable to similar fixed-rate debt.
(iii) Investment corporation bonds
The fair value of investment corporation bonds issued by the Company is determined based on their market prices.
(v) Derivative transactions
See “23. Derivatives and Hedge Accounting.”
Note 3: Redemption schedule for debt as of August 31, 2022
Thousands of Yen
Due within

After one year,

After two years,

After three years,

After four years,

one yearwithin two years

within three years

within four years

within five years——

9,000,000——

23,000,000

Long-term debt

64,435,600

47,935,600

58,762,000

54,100,000

52,725,000

207,505,000

Total

64,435,600

47,935,600

67,762,000

54,100,000

52,725,000

230,505,000

Investment corporation

After five years

bonds

Redemption schedule for debt as of February 28, 2023
Thousands of Yen
Due within

After one year,

After two years,

After three years,

After four years,

one yearwithin two years

within three years

within four years

within five years—

9,000,000——

2,000,000

21,000,000

Long-term debt

55,435,600

50,810,600

65,994,200

56,685,000

55,215,000

201,280,000

Total

55,435,600

59,810,600

65,994,200

56,685,000

57,215,000

222,280,000

Investment corporation

After five years

bonds

15. INVESTMENT AND RENTAL PROPERTIESThe Company owns leasable office, leasable retail facilities, leasable logistics facilities, leasable residential (including land) inGreater Tokyo area and other areas for the purpose of earning revenue from leasing. The following table summarizes the carrying
value and the estimated fair value of these properties.
Thousands of Yen
For the period
from March 1, 2022
to August 31, 2022

For the period
from September 1, 2022
to February 28, 2023

Carrying value
Balance at beginning of the period
Amount of increase (decrease) during the period
Balance at end of the period
Fair value at end of the period

1,059,049,692

1,067,176,298

8,126,606(8,115,950)

1,067,176,298

1,059,060,348

1,286,608,958

1,294,405,000

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
Hamamatsucho II (¥5,559,469 thousand), PROUD FLAT Togoshi-Ginza (¥2,644,993 thousand), PRIME URBAN Higashi Nakano Court (¥7,292,801
thousand). The decrease during the previous period is mainly attributable to the sale of Ichibancho stear (¥4,406,579 thousand) as well as depreciation(¥5,731,074 thousand). The increase during the current period is mainly attributable to the acquisition of PROUD FLAT Nezu Yanaka (¥1,452,611
thousand). The decrease during the current period is mainly attributable to the sale of NRE Higashi-nihonbashi Building (¥1,873,735 thousand), PRIMEURBAN Takaido (¥1,033,888 thousand), PRIME URBAN Mukojima (¥512,654 thousand), PRIME URBAN Nishi Funabashi (¥645,621 thousand),
PRIME URBAN Aoi (¥639,106 thousand), PRIME URBAN Tsurumai (¥846,837 thousand), PRIME URBAN Chiji Kokan (¥205,363 thousand), PRIMEURBAN Maruyama (¥194,652 thousand), PRIME URBAN Kita Nijyuyo Jo (¥362,295 thousand) as well as depreciation (¥5,665,963 thousand).
Note 3:Fair value at the end of the period is the appraisal value or investigation value determined by investigation, found by an outside real estate appraiser.

- 29 -

However, in the previous period, transfer price is used as the fair value for NRE Higashi-nihonbashi Building (September 15,2022), and the scheduledtransfer price is used as the fair value for NRE Higashi-nihonbashi Building (March 15,2023), PRIME URBAN Takaido, PRIME URBAN Mukojima,
PRIME URBAN Nishi Funabashi, PRIME URBAN Chiji Kokan, PRIME URBAN Maruyama, PRIME URBAN Kita Nijyuyo Jo, PRIME URBAN Aoi,
PRIME URBAN Tsurumai. In the current fiscal period, transfer price is used as the fair value for NRE Higashi-nihonbashi Building, NMF Nagoya
Yanagibashi Building, PRIME URBAN Yoyogi, PRIME URBAN Nishi Shinjuku II, PRIME URBAN Sangen Jaya III, PRIME URBAN Shinagawa
Nishi, PRIME URBAN Komagome, PRIME URBAN Kasai II, PRIME URBAN Asakusa, PRIME URBAN Gyotoku Ekimae, the scheduled transfer
price is used as the fair value for NMF Tenjin-Minami Building, PRIME URBAN Otsuka.
The income (loss) in the previous period (March 1, 2022 to August 31, 2022) and current period (from September 1, 2022 to February 28, 2023) for investment
and rental properties is as presented in “Notes to Statement of Income and Retained Earnings” earlier in this report.

- 30 -

16. REVENUE RECOGNITION
1. Information on disaggregation of revenues from contracts with customers
Previous period (from March 1, 2022 to August 31, 2022)
Thousands of Yen
Revenues from contracts withcustomers (Note 1)

Sales to external customers

Proceeds from sales of real estate

5,382,000(Note 2)757,969

Utility expense revenues

1,531,876

1,531,876

Other

—

36,732,606

Total

6,913,876

39,022,452

Note 1: Leasing business revenues, which are subject to ASBJ Statement No. 13, “Accounting Standard for Lease Transactions,” and real estate transfers, which
are subject to the “Practical Guidelines Concerning Accounting for the Transferors in Securitization of Real Estate Using SPCs” of the JICPA Accounting
System Committee Report No. 15, are not subject to the Accounting Standard for Revenue Recognition, and are thus not included in the above amount.
Note that the main revenues from contracts with customers are gains on sale of real estate and utilities expense revenues.
Note 2: Gains on sale of real estate are recorded as profits/losses on sale of real estate (the amount after deducting real estate disposition costs and otherdisposition costs from gains on sale of real estate) in the statement of income and retained earnings. Since NMF records gains on sale of real estate as
operating revenues and losses on sale of real estate as operating expenses, only the amounts of gains on sale of real estate are described in the above table.

Current period (from September. 1, 2022 to February. 28, 2023)
Thousands of Yen
Revenues from contracts withcustomers (Note 1)

Sales to external customers

Proceeds from sales of real estate

3,277,458

Utility expense revenues(Note 2)1,638,421

1,666,778

1,666,778

Other

—

36,680,891

Total

4,944,237

39,986,092

Note 1: Leasing business revenues, which are subject to ASBJ Statement No. 13, “Accounting Standard for Lease Transactions,” and real estate transfers, which
are subject to the “Practical Guidelines Concerning Accounting for the Transferors in Securitization of Real Estate Using SPCs” of the JICPA Accounting
System Committee Report No. 15, are not subject to the Accounting Standard for Revenue Recognition, and are thus not included in the above amount.
Note that the main revenues from contracts with customers are gains on sale of real estate and utilities expense revenues.
Note 2: Gains on sale of real estate are recorded as profits/losses on sale of real estate (the amount after deducting real estate disposition costs and otherdisposition costs from gains on sale of real estate) in the statement of income and retained earnings. Since NMF records gains on sale of real estate as
operating revenues and losses on sale of real estate as operating expenses, only the amounts of gains on sale of real estate are described in the above table.

2. Basic information for understanding revenues from contracts with customers
Previous period (from March 1, 2022 to August 31, 2022)
Refer to the description in the notes concerning matters pertaining to significant accounting policies.
Current period (from September 1, 2022 to February 28, 2023)
Refer to the description in the notes concerning matters pertaining to significant accounting policies.
3. Information on the satisfaction of performance obligations based on contracts with customers, relationships with cash flows arisingfrom the contracts, and the amounts of revenues which arise from outstanding contracts with customers as of the end of the accounting
period under review and will be recognized in the next accounting period onwards, as well as the timing to recognize the revenues(1) Balances of contract assets and liabilities
Thousands of Yen

Receivables from contracts with customers(balance as of the beginning of the fiscal period)
Receivables from contracts with customers(balance as of the end of the fiscal period)

Previous period
from March. 1, 2022
to August. 31, 2022

Current period
from September. 1, 2022
to February. 28, 2023

372,248497,211497,211

466,028- 31 -

Contract assets (balance as of the beginning of
the fiscal period)——

Contract assets (balance as of the end of the
fiscal period)——

Contract liabilities (balance as of the beginningof the fiscal period)——

Contract liabilities (balance as of the end of the
fiscal period)——(2) Transaction prices allocated to remaining performance obligations
Previous period (from March 1, 2022 to August 31, 2022)
As of August 31, 2022, the transaction price allocated to remaining performance obligations relating to the sale of real estate and otherassets was ¥4,520,000 thousand for real estate and other assets for which a purchase and sale agreement was concluded on March 8,2022.
Of the remaining performance obligations, NMF completed the transfer of ¥2,260,000 thousand of the relevant real estate and otherassets on September 15, 2022 and expect to recognize a gain in the February 28, 2023 (15th) fiscal period.
In addition, with regard to the remaining ¥2,260,000 thousand, NMF expects to recognize a gain in the August 31, 2023 (16th) fiscal
period in conjunction with the transfer of the relevant real estate and other assets, which is planned to take place on March 15, 2023.
Concerning utility expense revenues, NMF recognizes them with the amounts for which it has the right to claim according to item 19of the Implementation Guidance on the Accounting Standard for Revenue Recognition. This is because NMF has the right to receive
the amounts of consideration, which directly correspond to the value for customers or tenants, from customers for the portions where
the obligations are satisfied before the end of a fiscal period. Accordingly, adopting the stipulation of item 80-22 (2) of the AccountingStandard for Revenue Recognition, utility expense revenues are not included in the note on transaction prices allocated to remaining
performance obligations.
Current period (from September 1, 2022 to February 28, 2023)
As of February 28, 2023, the transaction price allocated to remaining performance obligations relating to the sale of real estate andother assets was ¥2,260,000 thousand for NRE Higashi-nihonbashi Building for which a purchase and sale agreement was concluded
on March 8, 2022.
Of the remaining performance obligations, NMF completed the transfer of ¥2,260,000 thousand of the relevant real estate and otherassets on March 15, 2023 and expects to recognize a gain in the August 31, 2023 (16th) fiscal period.
Concerning utility expense revenues, NMF recognizes them with the amounts for which it has the right to claim according to item 19of the Implementation Guidance on the Accounting Standard for Revenue Recognition. This is because NMF has the right to receive
the amounts of consideration, which directly correspond to the value for customers or tenants, from customers for the portions where
the obligations are satisfied before the end of a fiscal period. Accordingly, adopting the stipulation of item 80-22 (2) of the AccountingStandard for Revenue Recognition, utility expense revenues are not included in the note on transaction prices allocated to remaining
performance obligations.

- 32 -

17. SEGMENT INFORMATION
For the periods from March 1, 2022 to August 31, 2022 and from September 1, 2022 to February 28, 2023
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 for 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, a geographicalbreakdown of revenues 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, a geographicalbreakdown of property and equipment has been omitted.
3. Information about major clients
For the period from March 1, 2022 to August 31, 2022
Customer name

Revenues (Thousands of Yen)

Related segment name

Nomura Real Estate Partners Co., Ltd.

5,451,496

Rental real estate business

For the period from September 1, 2022 to February 28, 2023
Customer name

Revenues (Thousands of Yen)

Related segment name

Nomura Real Estate Partners Co., Ltd.

5,370,691

Rental real estate business- 33 -

18. BREAKDOWN OF REAL ESTATE RENTAL REVENUES AND EXPENSES
Real estate rental revenues and expenses for the fiscal periods ended August 31, 2022 and February 28, 2023 consist of the following:Thousands of Yen
For the period
from March 1, 2022
to August 31, 2022
Real estate rental revenues

For the period
from September 1, 2022
to February 28, 2023

38,264,482

38,347,670

35,249,227

35,273,552

Rental revenues

32,975,247

33,030,571

Common area charges

2,273,980

2,242,980

3,015,254

3,074,117

Rental revenues

Other rental revenues
Parking revenues

647,115

641,578

Incidental income

2,249,949

2,347,140

Other miscellaneous revenues

118,189

85,39816,652,112

17,069,913

Property management costs

1,855,012

1,907,712

Property management fees

1,071,906

959,333

Property and other taxes

3,313,137

3,285,890

Utility expenses

1,878,814

2,333,894

Casualty insurance

64,37062,629Real estate rental expenses

Repairs and maintenance1,326,497

1,434,180

Land rents

188,976

189,361

Depreciation

5,738,419

5,673,345

Other rental expenses

1,214,9781,223,564

21,612,370

21,277,757

Real estate rental profits- 34 -

19. BREAKDOWN OF GAIN AND LOSS ON SALES OF REAL ESTATE
For the period from March 1, 2022 to August 31, 2022
Thousands of Yen
Ichibancho stear
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

5,382,000
4,406,579
217,451

Gain on sales of real estate

757,969

For the period from September 1, 2022 to February 28, 2023
Thousands of Yen
NRE Higashi-nihonbashi Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

2,260,000
1,873,735
36,030Gain on sales of real estate

350,234
Thousands of Yen

PRIME URBAN Takaido
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

1,310,000
1,033,888
52,789Gain on sales of real estate

223,321
Thousands of Yen

PRIME URBAN Mukojima
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

636,500
512,654
28,667

Gain on sales of real estate

95,177
Thousands of Yen

PRIME URBAN Nishi Funabashi
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

967,000
645,62138,867

Gain on sales of real estate

282,511
Thousands of Yen

PRIME URBAN Aoi
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

763,000
639,106
30,947

Gain on sales of real estate

92,945
Thousands of Yen

PRIME URBAN Tsurumai
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses

1,281,000
846,837
51,507

Gain on sales of real estate

382,655- 35 -

Thousands of Yen
PRIME URBAN Chiji Kokan
Proceeds from sales of real estate
Cost of sales of real estate

300,740
205,363

Other related sales expenses

12,998Gain on sales of real estate

82,378
Thousands of Yen

PRIME URBAN Maruyama
Proceeds from sales of real estate
Cost of sales of real estate

257,325
194,652

Other related sales expenses

11,085Gain on sales of real estate

51,586
Thousands of Yen

PRIME URBAN Kita Nijyuyo Jo
Proceeds from sales of real estate
Cost of sales of real estate

459,393362,295

Other related sales expenses

19,488Gain on sales of real estate

77,60920. BREAKDOWN OF EXTRAORDINARY GAIN
For the period from March 1, 2022 to August 31, 2022
The ¥155,651 thousand related to the donation of building fixtures that belonged to tenants at the time the tenants vacated the premises
is recorded as a gain on donation of fixed assets.

For the period from September 1, 2022 to February 28, 2023
Not applicable.

- 36 -

21. BREAKDOWN OF EXTRAORDINARY LOSS
For the period from March 1, 2022 to August 31, 2022
Losses related to assets damaged by the 2022 Fukushima Earthquake totaling ¥46,519 thousand are recorded as loss on disaster.
For the period from September 1, 2022 to February 28, 2023
Not applicable.

22. LEASESThe future minimum rental revenues from tenants under non-cancelable operating leases of properties as of August 31, 2022 andFebruary 28, 2023 are summarized as follows:
Thousands of Yen

As of August 31, 2022

As of February 28, 2023

Due within one year

39,597,949

39,171,049

Due after one year

98,376,846

90,603,655

Total

137,974,796

129,774,705- 37 -

23. DERIVATIVES AND HEDGE ACCOUNTING
Derivative transactions as of August 31, 2022
(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
Hedge accounting
methodType of derivative
instruments

Main hedged item

Fair value (Note 2)

Notional amount(Note 1)

Due after
one yearPrincipal treatment
methodInterest-rate swaps:
Received/floating andpaid/fixedLong-term debt

34,350,000

2,000,000(48,676) (Note 3)

Special treatment ofinterest-rate swaps

Interest-rate swaps:
Received/floating andpaid/fixedLong-term debt

29,304,100

22,361,300(213,426) (Note 4)

63,654,100

24,361,300(262,103)

Total
Note 1: Contract amount is based on notional amount.

Note 2: Fair value is measured by swap counterparty, based on the actual market interest rate, etc.
Note 3: Out of the fair value, (¥850 thousand) is booked as “accrued expenses” on the Balance Sheet.
Note 4: Out of the fair value, (¥213,426 thousand) is not marked to market on the Balance Sheet, since adopting special treatment for interest-rate swaps.

Derivative transactions as of February 28, 2023
(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
Hedge accounting
methodType of derivative
instruments

Main hedged item

Fair value (Note 2)

Notional amount(Note 1)

Due after
one yearPrincipal treatment
methodInterest-rate swaps:
Received/floating andpaid/fixedLong-term debt

15,800,000—(23,959) (Note 3)

Special treatment ofInterest-rate swaps:

Long-term debt

24,382,700

19,739,900(41,531) (Note 4)interest-rate swaps

Received/floating andpaid/fixed
40,182,700

19,739,900(65,491)

Total
Note 1: Contract amount is based on notional amount.

Note 2: Fair value is measured by swap counterparty, based on the actual market interest rate, etc.
Note 3: Out of the fair value, (¥121 thousand) is booked as “accrued expenses” on the Balance Sheet.
Note 4: Out of the fair value, (¥41,531 thousand) is not marked to market on the Balance Sheet, since adopting special treatment for interest-rate swaps.

- 38 -

24. CASH DISTRIBUTIONS
For the period
from March 1, 2022
to August 31, 2022

For the period
from September 1, 2022
to February 28, 2023

1. Retained earnings at end of period

13,594,898,383

13,997,163,463

2. Distributions in excess of retained earnings

2,060,542,400

1,669,180,800

1,900,225,600

1,556,016,000

160,316,800

113,164,800

46,744,842

23,986,955

46,744,842

23,986,955

15,560,160,000

15,616,742,400(3,300)(3,312)

13,499,617,600

13,947,561,600

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)]
5. Retained earnings carried forward(2,863)(2,958)1,900,225,600

1,556,016,000

(403)

(330)

160,316,800

113,164,800

(34)

(24)

48,535,941

25,614,908

Calculation method of distribution amount
NMF calculates distributions in accordance with the cash distribution policies as specified in Article 36, paragraphs 1 and 2 of NMF’s Articles of Incorporation.
For the fiscal period under review,NMF decided to implement a total of ¥15,616,742,400 in distributions (¥3,312 per investment unit). This figure was arrived atby ¥13,948,627,522 in net income after taxes and ¥2,622,242,820 in amortization of goodwill and subtracting ¥954,127,942, the total of a portion of gains on saleof real estate.
Total distributions comprise distribution of earnings and distribution in excess of net income. Distribution of earnings as stipulated in Article 136, paragraph 1 ofthe Investment Trusts Act came to ¥13,947,561,600 (¥2,958 per investment unit). Distribution in excess of net income comprises a distribution of ¥1,556,016,000(¥330 per investment unit) as allowance for temporary difference adjustment and ¥113,164,800(¥24 per investment unit) in other distribution in excess of net
income.

- 39 -

25. INFORMATION ON ALLOWANCE FOR TEMPORARY DIFFERENCE
ADJUSTMENTS
For the period from March 1, 2022 to August 31, 2022
1. Reason for provision, related assets and amounts
Thousands of Yen
Related assets, etc.
Goodwill

Reason for provision

Provision of allowancefor temporary difference adjustments

Amortization of goodwill

2,622,242

Increase-subtotal

2,622,242

Buildings, facilities, etc.

Depreciation deficiency equivalent(686,268)

Unearned revenue

Write-down of loss on interest-rate swap
due to merger(19,546)

Land

Cost of sales of land

(11,410)

Other—(4,792)

Decrease-subtotal(722,017)

Total

1,900,225

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

Reason for reversal

Provision of allowancefor temporary difference adjustments

Land, Buildings, etc.

Sale and depreciation of properties forwhich merger expenses were recorded—(Note 1)

Deferred gains or losses on hedges

Changes in fair value of derivatives(46,744)(46,744)

Total

Note 1: The amount of reversal during the current fiscal period (¥14,226 thousand) is included in “Depreciation deficiency equivalent” on “1. Reasons forprovision, related assets and amounts.”

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(3) Long-term deposits
In principle, long-term deposits are not reserved.
(4) Deferred gains or losses on hedges
The amount corresponding to changes in the fair value of derivatives used as hedging instruments is scheduled to be reversed.

- 40 -

For the period from September 1, 2022 to February 28, 2023
1. Reason for provision, related assets and amounts
Thousands of Yen
Related assets, etc.
Goodwill

Reason for provision

Provision of allowancefor temporary difference adjustments

Amortization of goodwill

2,622,242

Increase-subtotal

2,622,242

Buildings, facilities, etc.

Depreciation deficiency equivalent(576,274)

Unearned revenue

Write-down of loss on interest-rate swap
due to merger

Land

Cost of sales of land

(480,284)

Other

—

(2,519)(7,148)Decrease-subtotal(1,066,226)

Total

1,556,016

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

Reason for reversal

Provision of allowancefor temporary difference adjustments

Land, Buildings, etc.

Sale and depreciation of properties forwhich merger expenses were recorded—(Note 1)

Deferred gains or losses on hedges

Changes in fair value of derivatives(23,986)(23,986)

Total

Note 1:The amount of reversal during current period (¥17,648 thousand) is included in “Depreciation deficiency equivalent” on “1. Reasons, related assets andamounts of allowance”

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(3) Long-term deposits
In principle, long-term deposits are not reserved.
(4) Deferred gains or losses on hedges
The amount corresponding to changes in the fair value of derivatives used as hedging instruments is scheduled to be reversed.

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26. SIGNIFICANT SUBSEQUENT EVENTSAsset Sales(a) NMF sold the following assets after the conclusion of the 15th fiscal period (February 28, 2023).

Property Name

NRE Higashi-nihonbashi
Building (Quasi
co-ownership of 50%)

Type of
asset

Trust
beneficial
interest in
trust of realestate

Use

Offic
e

Contract
date

March 8,2022

Transfer
date

Buyer

Transfer
price(¥ million)

Impact on
16th fiscal
periodearnings(Scheduled)(¥ million)

March 15,
2023

Domestic
generalbusinesscompany

2,260

350

Domestic
specialpurposecompany

6,283(Note 2)

1,550
(Note 2)

4,410

1,695

PRIME URBAN
Yoyogi (Note 1)
PRIME URBAN
Nishi Shinjuku II (Note 1)
PRIME URBAN
Sangen Jaya III (Note 1)

Real estate

PRIME URBAN
Shinagawa Nishi (Note 1)
Trust
beneficial
interest in
trust of realestatePRIME URBAN
Komagome

Resi
denti
al

March 22,2023

March 31,
2023

Offic
e

March 20,
2023

April 7,2023

PRIME URBAN Kasai II (Note1)
PRIME URBAN Asakusa(Note 1)PRIME URBAN
Ekimae (Note 1)

NMF Nagoya
Building

Real estate

Gyotoku

Yanagibashi

Trustbeneficial
interest in
trust of realestateDomestic
specialpurposecompany(Note 1) At the end of the 15th fiscal period, the asset to be transferred was real estate, but on March 31, 2023, a trust agreement
was concluded and it was transferred as a trust beneficial interest in trust of real estate.
(Note 2) Of the assets to be disposed of, the dispositions of PRIME URBAN Yoyogi, PRIME URBAN Nishi Shinjuku II, PRIMEURBAN Sangen Jaya III, PRIME URBAN Shinagawa Nishi, PRIME URBAN Komagome, PRIME URBAN Kasai II,
PRIME URBAN Asakusa, and PRIME URBAN Gyotoku Ekimae are based on a single sale agreement with the sametransferee. The transfer prices of individual properties are undisclosed, as consent has not been obtained from the- 42 -

transferee. Accordingly, the impact on 16th fiscal period earnings of individual properties is also undisclosed.
(b) NMF is going to sell the following asset after the conclusion of the 15th fiscal period (February 28, 2023)

Property name

Type ofasset

NMF Tenjin-Minami Building

Trustbeneficial
interest in
trust of realestatePRIME URBAN Otsuka

Real estate

Use

OfficeResident
ial

Contract
date(Scheduled)

March 17,2023

March 17,
2023

Buyer
(Scheduled)

Transfer
price(Scheduled)(¥ million)

Impact on
16th fiscal
periodearnings(Scheduled)(¥ million)

May 31,
2023

Tokyo
Tatemono Co.,
Ltd.

3,040

997

May 31,
2023

Tokyo
TatemonoReal
EstateSales
Co., Ltd.

772

96

Transferdate(Scheduled)

The impact of (a) and (b), above, on earnings for 16th fiscal period (March 1, 2023 to August 31, 2023) will be recorded asgain on sales of real estate under operating revenues.

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