NEWS RELEASEJan 26, 2022

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

Nomura Real Estate Master Fund, Inc.
Issuer Rating: AA-, Affirmed
Rating Outlook: Stable

RATIONALE:
Nomura Real Estate Master Fund, Inc. (NMF) is a diversified real estate investment trust (REIT) thatwas established in October 2015 through the merger of three REITs operated by the Nomura Real Estategroup. With a focus on the greater Tokyo area, NMF invests in various types of properties in a wellbalanced manner. Nomura Real Estate Holdings, Inc. serves as the sponsor of NMF.
NMF boasts an asset size of over 1 trillion yen -- one of the largest in the J-REIT industry. By asset
type, office buildings account for 43.5%, retail facilities 16.7%, logistics facilities 20.1% and residential
facilities 18.7% of the portfolio. The fact that the top 10 properties represent only 22% of NMF's total
assets suggests that the portfolio is very diverse. NMF continuously acquires assets from the sponsor's
stock of commercial properties. Moreover, as the ratio of properties in the greater Tokyo area has been
kept high with the average building age reduced, the portfolio quality is increasing. NMF's most recent
move to acquire a large, relatively new logistics facility in Tokyo for 17 billion yen has raised the ratio oflogistics facilities, for which the market is performing well.
Although the COVID-19 pandemic has had a negative impact on retail facilities near stations andhotels, these asset categories together account for only slightly over 10% of the portfolio. The impact onNMF's overall operations is thus limited. The occupancy rate of office buildings has declined to the 96%
range due to market deterioration, but the rent levels will likely stay solid as the current rents appear to be
below the market rents to some degree. The segments of the portfolio on which the pandemic had merely
a small impact, such as logistics facilities, residential facilities and retail facilities in residential areas,
make up more than 40% of the asset types, underpinning the stability of cash flow.
NMF has been proactive in ESG from early on. It is reducing greenhouse gas emission intensity toachieve its 2030 target. The percentage of properties that have obtained green building certification(including all assessments) is high at about 70% on a floor area basis, and in the 2021 GRESB Rating,
NMF earned 4 Stars.
The LTV ratio (calculated after excluding goodwill from total assets) was 46.3% as of August 2021.
The appraisal value is 16.2% greater than the book value, and there is no problem with leverage.
Funding conditions are favorable. Supported by stable funding sources consisting primarily of majordomestic financial institutions, the average remaining term to maturity is long at 4.9 years (as of August2021) and due dates are spread out. NMF ensures sufficient liquidity, given available committed lines ofcredit totaling 50 billion yen, as well as cash and deposits.
The Rating Outlook is Stable. NMF has a quality, well-diversified portfolio mainly in the greater Tokyo
area. There is no problem with leverage and NMF's funding base centered on long-term, fixed interest
rate loans is robust. Although the coronavirus impact has so far been limited, R&I will keep track of anearnings trend in the office sector, which constitutes a large portion of NMF's assets.
The primary rating methodology applied to this rating is provided at "Rating Methodology for REITs".
The methodology is available at the web site listed below, together with other rating methodologies thatare taken into consideration when assigning the rating.
https://www.r-i.co.jp/en/rating/about/rating_method.html■Contact: Sales and Marketing Division, Customer Service Dept.
■Media Contact : Corporate Planning Division (Public Relations)Rating and Investment Information, Inc.

TEL.+81-(0)3-6273-7471 E-mail. infodept@r-i.co.jp
TEL.+81-(0)3-6273-7273

TERRACE SQUARE, 3-22 Kanda Nishikicho, Chiyoda-ku, Tokyo 101-0054, Japan https://www.r-i.co.jp

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

NEWS RELEASE
R&I RATINGS:ISSUER:RATING:

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

RATING OUTLOOK:

StableNomura Real Estate Office
Fund, Inc. Unsec. Str. Bonds
No.7

Issue Date

Maturity Date

Issue Amount (mn)

Mar 19, 2007

Mar 17, 2028

JPY 4,500

RATING:

AA-, Affirmed

Nomura Real Estate Office
Fund, Inc. Unsec. Str. Bonds
No.10

Issue Date

Maturity Date

Issue Amount (mn)Nov 25, 2014

Nov 25, 2024

JPY 6,000

RATING:AA-, Affirmed■Contact: Sales and Marketing Division, Customer Service Dept.
■Media Contact : Corporate Planning Division (Public Relations)Rating and Investment Information, Inc.

TEL.+81-(0)3-6273-7471 E-mail. infodept@r-i.co.jp
TEL.+81-(0)3-6273-7273

TERRACE SQUARE, 3-22 Kanda Nishikicho, Chiyoda-ku, Tokyo 101-0054, Japan https://www.r-i.co.jp

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