November 29, 2019
FOR IMMEDIATE RELEASE
Activia Properties Inc.
21-1, Dogenzaka 1-chome, Shibuya-ku, Tokyo
Kazushi Sato
Executive Director(Code: 3279)
Asset Management Company
TLC REIT Management Inc.
Hiroyuki Tohmata
President & CEOInquiries
Kazuyuki Murayama
General Manager of Strategy Department
Activia Management Division(Tel: +81-3-6455-3377)

Notice Concerning Revision to Forecast of Management Performancefor the Fiscal Period Ending May 31, 2020 and Forecast ofManagement Performance for the Fiscal Period Ending November 30, 2020
Activia Properties Inc. (“API”) announces that it has revised the forecast of the management
performance for the fiscal period ending May 31, 2020 (December 1, 2019 - May 31, 2020) (the 17thPeriod), which was announced on July 12, 2019 in the “Financial Report for the Fiscal Period Ended May
31, 2019 (December 1, 2018 - May 31, 2019)”.
In addition, it announces the forecast of the management performance for the fiscal period ending
November 30, 2020 (June 1, 2020 - November 30, 2020) (the 18th Period). Details are as follows.

1．Reason for the revision to the forecast
Considering the effect of the acquisition and the disposition of assets as described in the “Notice ofAcquisition of Asset, Lease Contract with New Tenants and Disposition of Asset” announced today, API
has revised the forecast of the management performance due to the change in the assumptions for theforecast of the management performance for the fiscal period ending May 31, 2020 (December 1, 2019 May 31, 2020), which was announced on July 12, 2019.
In addition, API forecasts for the fiscal period ending November 30, 2020 (June 1, 2020 - November30, 2020) based on the aforementioned assumptions.
The forecast of management performance for the fiscal period ending November 30, 2019 (June 1, 2019- November 30, 2019) announced on July 12, 2019 has not changed as of today.

12．The revision to the forecast for the fiscal period ending May 31, 2020 (the 17th Period)

Previous Forecast(A)
Revised Forecast(B)
Changes(B-A)
Changes(Reference)

Profit(Millions ofyen)

Cashdistributions
per unit
(yen)

Cash
distributions
in excess ofearnings perunit
(yen)

7,482

7,481

9,700

－

8,590

7,621

7,620

9,880

－

744

111

139

139

180

－

5.0%

1.3%

1.9%

1.9%

1.9%

－

Cash
distributions
in excess ofearnings perunit(yen)－Operatingrevenues(Millions ofyen)

Operatingprofit(Millions ofyen)

Ordinary
profit(Millions ofyen)

14,883

8,478

15,628

Expected number of investment units at the end of the fiscal period: 771,224 units

3．The forecast for the fiscal period ending November 30, 2020 (the 18th Period)

Forecast(Reference)

Operatingrevenues(Millions ofyen)

Operatingprofit(Millions ofyen)

Ordinary
profit(Millions ofyen)

Profit(Millions ofyen)

Cashdistributions
per unit(yen)

15,822

8,667

7,659

7,658

9,930

Expected number of investment units at the end of the fiscal period: 771,224 units(Notes)1. The forecasts in this material are valid as of today and are calculated based on the assumptions given in the Exhibit“Assumptions for Forecasts of Management Performance for the Fiscal Period Ending May 31, 2020 (December 1,2019 - May 31, 2020) and for the Fiscal Period Ending November 30, 2020 (June 1, 2020 - November 30, 2020)”.
Actual operating revenues, operating profit, ordinary profit, profit and cash distributions per unit may change due tofactors in the future such as acquisition and/or disposition of assets, trends in the real estate market, issuance ofadditional investment units, and other changes in circumstances surrounding API. The forecasts do not guarantee theamount of cash distributions.
2. The forecasts may be revised if a substantial difference from the forecast above is anticipated.
3. Amounts less than the stated units are rounded down and the percentage is rounded to the first decimal place. The
same applies hereinafter.

*Distribution of this material: This material is distributed to the Kabuto Club; the press club for the Ministry ofLand, Infrastructure, Transport and Tourism; and the press club for construction trade newspapers at theMinistry of Land, Infrastructure, Transport and Tourism.
*Website of API: https://www.activia-reit.co.jp/en/

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【Exhibit】
Assumptions for Forecasts of Management Performance for the Fiscal Period Ending May 31, 2020 (December 1,2019 - May 31, 2020) and for the Fiscal Period Ending November 30, 2020 (June 1, 2020 - November 30, 2020)

ItemAccounting period•••

Assets undermanagement•••
Operating revenues•••

Operating expenses•

Assumptions
The 17th Period (December 1, 2019 to May 31, 2020) (183 days)
The 18th Period (June 1, 2020 to November 30, 2020) (183 days)
The forecast of management performance presented herein is based on theassumption that we hold the trust beneficiary interests in the 44 properties (the“assets currently held”) as of today, and other than the acquisition of Ebisu
Prime Square (51% co-ownership interest) (the “anticipated asset”) scheduled
on January 10, 2020 and the disposition of A-PLACE Shinbashi Ekimae (the“asset to be disposed of”) scheduled on March 19, 2020, there will be nochanges in the assets under management of API including acquisition ofproperties or disposition of properties before the end of the fiscal period ending
November 30, 2020 (the 18th Period).
Actual management performance may change due to changes in the assets undermanagement.
Revenues from the leasing of the currently held assets are calculated based on
the effective lease contracts as of today and market trends, etc. Revenues fromthe leasing of the anticipated asset are calculated based on the lease contractfrom the scheduled date of acquisition expected as of today and other factors.
Operating revenues are based on the assumption that there will be nodelinquencies or non-payment of rents by tenants.
From the disposition of the asset to be disposed of, gain on sales of the propertyof 158 million yen will be recorded for the fiscal period ending May 31, 2020
(the 17th Period). Actual operating revenues may change due to factors in thefuture such as success or failure of the disposition of the property, the price andthe date of the disposition and other conditions.
With regard to the expenses in the leasing business that are principal operating
expenses, expenses other than depreciation for the currently held assets arecalculated reflecting variable expense factors based on past history. Expenses
for the anticipated asset are calculated by reflecting variable expense factors andothers based on the information provided by the previous owner.
Although property taxes and city planning taxes on the anticipated asset aregenerally calculated on a pro rata basis with the current owner and settled at thetime of acquisition, the amount equivalent to the settlement money is not
expensed in the period when the asset is acquired, as it is included in theacquisition cost. The total amount of property taxes, city planning taxes andother taxes on the anticipated asset that are included in the acquisition cost isassumed to be 135 million yen. Property taxes, city planning taxes and othertaxes on the currently held assets to be expensed in the fiscal period ending May
31, 2020 (the 17th Period) and the fiscal period ending November 30, 2020 (the18th Period) will be 1,099 million yen and 1,270 million yen, respectively. With
regard to the anticipated asset, property taxes, city planning taxes and othertaxes for fiscal year 2021 will be expensed starting from the fiscal period endingNovember 30, 2021 (the 20th Period).
With respect to building repair expenses, the amount assumed to be necessary3•••Non-operatingexpenses••

Interest bearing debt•••
Investment units•
Cash distributions
per unit•

for each business period is estimated based on a medium- and long-term repair
and maintenance plan formulated by the Asset Management Company.
However, repair expenses in each business period may differ largely from theexpected amount for various reasons, including that repair and maintenanceexpenses could suddenly arise due to damage to buildings from certain
unexpected factors; that the amount of repair expenses generally varies
considerably from year to year; and that repair expenses do not occur regularly.
Depreciation expenses including ancillary costs are calculated by the straightline method. The forecast assumes 1,334 million yen in depreciation expenses
in the fiscal period ending May 31, 2020 (the 17th Period) and 1,334 million
yen in the fiscal period ending November 30, 2020 (the 18th Period).
With regard to the asset to be disposed of, an operating account receivable of234 million yen recorded during free rent period will be transferred to theexpenses in the other expenses related to leasing business and posted asexpenses.
For interest expenses and other borrowing costs, 968 million yen and 1,007
million yen are anticipated in the fiscal period ending May 31, 2020 (the 17thPeriod) and in the fiscal period ending November 30, 2020 (the 18th Period),respectively.
API has a total outstanding balance of 234,350 million yen as of today (211,350
million yen as borrowings and 23,000 million yen as investment corporationbonds). Also it is assumed that we will borrow funds of 31,000 million yen on
January 10, 2020 for the acquisition of the anticipated asset and repay 21,000
million yen on March 19, 2020, applying the net proceeds from the dispositionof the asset to be disposed of. As the result, the accretive amount of our interest
bearing debt will be 244,350 million yen.
The interest bearing debt which becomes due and payable by the end of thefiscal period ending May 31, 2020 (the 17th Period) and the fiscal period ending
November 30, 2020 (the 18th Period) is comprised of 26,000 million yen of theshort-term borrowings, 7,300 million yen of the long-term borrowings and6,000 million yen of the investment corporation bonds for the 17th Period, and4,000 million yen of the short-term borrowings for the 18th Period. And it isassumed that 21,000 million yen of the short-term borrowings which will
become due and payable by the end of the fiscal period ending May 31, 2020
(the 17th Period) will be repaid on March 19, 2020 (17th Period) and all the rest
will be refinanced.
LTV at the end of the fiscal period ending May 31, 2020 and the fiscal period
ending November 30, 2020 is anticipated to be 46.6%.
LTV is calculated based on the following formula:
LTV = Balance of interest bearing debt / Total assets × 100
Cash distributions per unit for the fiscal period ending May 31, 2020 (the 17thPeriod) and the fiscal period ending November 30, 2020 (the 18th Period) arecalculated based on 771,224 units currently outstanding as of today, and it isassumed that no additional units will be issued by November 30, 2020 (the endof the 18th Period).
Distributions (cash distributions per unit) are calculated on the fund distribution
policy that is provided in the Articles of Incorporation.
Cash distributions per unit may fluctuate due to various factors includingchanges in rent revenues attributable to changes in the assets under management

4••
Cash distributions inexcess of earnings
per unit••
Other•and changes in tenants, as well as the occurrence of unexpected repairs andmaintenance.
Deferred losses on hedges, which arise from interest rate swaps and are counted
as a deduction in net assets, are calculated assuming no fluctuation.
API does not currently anticipate cash distributions in excess of our distributableprofit (cash distributions in excess of earnings per unit) for the fiscal period
ending May 2020 (the 17th Period) and the fiscal period ending November 2020
(the 18th Period) as it is assumed that deferred losses on hedges counted as adeduction in net assets are assuming no fluctuation as mentioned above.
We currently do not anticipate distributions deemed as distributions on
reduction of unitholders’ capital for tax purposes.
It is based on the assumption that there will be no amendments to the laws, tax
system, accounting standards, listing rules, or the rules of the Investment Trusts
Association, Japan, etc. that may affect the forecast values.
It is based on the assumption that there will be no unexpected significant
changes in general economic trends, real estate market conditions and otherconditions.

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