Creating peace of mind through honest and committed management.

June 16, 2014

FINANCIAL REPORT FOR THE FISCAL PERIOD ENDING APRIL 2014
(November 1, 2013 – April 30, 2014)
Ichigo Real Estate Investment Corporation (“Ichigo REIT” Tokyo Stock Exchange, 8975)
Representative: Yoshihiro Takatsuka, Executive Director
www.ichigo-reit.co.jp/english
Ichigo Real Estate Investment Advisors Co., Ltd. (Ichigo REIT Asset Management Company)
Representative: Wataru Orii, President & Representative Statutory Executive Officer
Inquiries: Masanori Kubota, Statutory Executive Officer (Finance, Accounting)Telephone: +81-3-3502-4891
Submission of Yuka Shoken Hokokusho (Financial Report): July 25, 2014 (expected)
Dividend Payment: July 22, 2014 (expected)
Supplemental Material to Financial and Business Results: Yes (Corporate Presentation)
Financial and Business Results Briefing: Yes (for institutional investors and analysts)
1. Financial Results for the Fiscal Period Ending April 2014
(Monetary figures are rounded down to the nearest million yen)

(1) Earnings(million yen; period-on-period change)

Fiscal PeriodEnding April 2014
Fiscal PeriodEnding October 2013

Fiscal PeriodEnding April 2014
Fiscal PeriodEnding October 2013

OperatingRevenue

ChangeOperating
IncomeChangeOrdinary
IncomeChangeNet
IncomeChange

4,637

1.4%

2,187(4.6%)

1,307(12.3%)

1,306(12.3%)

4,572

10.3%

2,293

12.6%

1,490

229.8%

1,489

230.1%Net Income per Share(yen)Ratio of Net Income
to Equity

Ratio of Ordinary
Incometo Total Assets

Ratio of Ordinary
Incometo Operating Revenue

1,295

2.2%

1.1%

28.2%

1,619

2.8%

1.3%

32.6%

(Note) Net income per share is calculated by dividing net income by the weighted average number of shares.
(2) Dividends
Dividend perShareTotalDividends

Dividend per Sharein Excess ofEarnings

Total Dividends inExcess of Earnings

PayoutRatio

Ratio ofDividends toNet Assets(yen)(million yen)

(yen)(million yen)

(%)

(%)

1,541

1,581

00

121.0

2.6

1,537

1,433

0

0

96.2

2.6

(not includingdividends in excessof earnings)

Fiscal PeriodEnding April 2014
Fiscal PeriodEnding October 2013

(Note 1) The October 2013 dividend reflects a 55 million yen dividend reserve deduction and thus differs fromNet Income.
(Note 2) The April 2014 dividend includes a dividend reserve reversal of 275 million yen and thus differs fromNet Income.
(Note 3) The Payout Ratio is rounded down to one decimal. The October 2013 and April 2014 payout ratio
reflects the new share issuance and is calculated as follows: Payout Ratio = Total Dividends / Net
Income x 100

(3) Assets and Equity

Fiscal PeriodEnding April 2014
Fiscal PeriodEnding October 2013

Total Assets(million yen)

Net Assets(million yen)

Equity Ratio(%)

Net Assets per Share(yen)124,399

61,27049.3

59,698

121,924

55,97445.9

60,005

Cash Flow fromOperating Activities

Cash Flow from
Investment Activities

Cash Flow from
Financing Activities(million yen)(million yen)(million yen)

8,111

(8,447)854

10,195

2,866(8,679)

7,203

9,676

(4) Cash Flow

Fiscal PeriodEnding April 2014
Fiscal PeriodEnding October 2013

Cash and Cash
Equivalents at End of thePeriod(million yen)

2. Earnings Forecast for the Fiscal Period ending October 2014 (May 1, 2014 to October 31, 2014)(million yen; period-on-period change)

Fiscal PeriodEnding October 2014

OperatingRevenue

ChangeOperating
IncomeChangeOrdinary
IncomeChangeNet
IncomeChange4,531(2.3%)

2,112(3.4%)

1,483

13.5%

1,482

13.5%
(yen)

Dividend per Share(not including dividends in excess of earnings)

Fiscal PeriodEnding October 2014

(Note 1)
(Note 2)

1,530

Dividend per Share in Excess of Earnings
0

The forecast Net Income per share for October 2014 is 1,444 yen.
The October 2014 dividend includes a dividend reserve reversal of 90 million yen and thus differsfrom Net Income.

23. Other(1) Changes in Accounting Policies, Changes in Accounting Estimates, and Retrospective Restatement(i) Changes Accompanying Amendments to Accounting Standards:(ii) Changes Not Listed in (i):(iii) Changes in Accounting Estimates:(iv) Retrospective Restatement:

NoNoNoNo(2) Number of Shares Issued and Outstanding(i) The number of shares issued and outstanding (including treasury shares) was 932,823 shares at theend of October 2013 and 1,026,323 shares at the end of April 2014.
(ii) There were no treasury shares at either the end of October 2013 or at the end of April 2014.
Completion Status of Auditing ProceduresThis document is not subject to the auditing requirements set forth in the Financial Instruments and Exchange
Law of Japan. The auditing procedures in accordance with those requirements have not been completed as of thedate of the publication of this document.
Appropriate Use of Performance Forecasts and Other Matters of Special Note
The forecasts presented above are current figures based on certain preconditions. Accordingly, the actual
operating revenue, operating income, ordinary income, net income, dividend per share, and dividend per sharein excess of earnings may vary due to changes in circumstances. Moreover, these forecasts should not beconstrued as a guarantee of such performance or results.
For details on preconditions, please refer to the “Preconditions for Earnings Forecasts of the Fiscal Periods
ending October 2014” on pages 4.
This English version is a translation of the original Japanese notice and is provided solely for informational
purposes. Should there be any discrepancies between this translation and the Japanese original, the latter shallprevail.

3

Preconditions for Earnings Forecast for the Fiscal Period ending October 2014
ItemPreconditions

Periods

The Fiscal Period Ending October 2014: May 1, 2014 – October 31, 2014 (184 days)

Portfolio Assets

 71 properties as of April 30, 2014, excluding the COI Shinbashi Building sold as of April 30, 2014,
and based on the assumption that the number of assets will not change by the end of October 2014.
 The number of assets may change due to acquisitions or sales.

Number of Shares The number of shares issued and outstanding at the time of this publication: 1,026,323

Operating Revenue Rental revenue is conservatively forecast based on leases that are in effect as of April 30, 2014, taking
into consideration such factors as historical rents, property competitiveness, and market conditions.

Operating Expenses

 Ichigo REIT’s principal operating expenses are related to its rental activities. Excepting depreciation,expenses are calculated based on historical data while taking into consideration variable expenses.
 The anticipated amount of property tax and city planning tax is 345 million yen for October 2014.
 Building maintenance and repair expenses are estimated to be 83 million yen for October 2014.
However, expenses for each period could differ significantly from these estimated amounts for various
reasons due to the irregularity of maintenance and repair expenses, costs due to unexpected building
damage, etc., and year-to-year changes in costs.
 Service provider expenses including property management fees, etc. are estimated to be 425 million
yen for October 2014.
 Depreciation has been calculated using the straight line method. For managed properties, depreciation
is calculated by including the depreciation for future additional capital expenditures in the amortization
amount. Depreciation for October 2014 is forecast at 600 million yen.
 Due to unexpected circumstances, the actual operating expenses might differ significantly from theforecasts.

Non-operating
Expenses Interest expenses for October 2014 are forecast at 479 million yen.
 Borrowing-related expenses for October 2014 are forecast at 152 million yen.

Borrowings

 As of April 30, 2014, Ichigo REIT’s balance of loans payable stands at 56,409 million yen.

Dividend per Share Dividends are based on the assumption that distribution will comply with the dividend distribution
policy stipulated in Ichigo REIT’s Articles of Incorporation.
 Dividend for October 2014 is assumed to be 1,573 million yen, which is the total amount of retained
earnings of 1,482 million yen plus a dividend reserve reversal of 90 million yen.
 The dividend per share is subject to change due to factors such as changes in rental revenue associatedwith tenant turnover, the occurrence of unexpected maintenance and repair costs, fluctuations ininterest rates, as well as additional share issuance.

Dividend in Excess ofEarnings per Share Ichigo REIT does not plan on making any dividend distribution in excess of earnings per share orretained earnings.

Other Performance forecasts are based on the assumption that impactful revisions will not be made to laws
and ordinances, the tax system, accounting standards, listing rules, and rules of the Investment Trusts
Association, Japan, etc.
 Performance forecasts are also based on the assumption that there will be no unexpected materialchange in general economic trends, real estate market conditions, etc.

4Financial Statements(1) Balance Sheet(Thousand yen)
Fiscal PeriodEnding October 2013(as of October 31, 2013)

Fiscal PeriodEnding April 2014(as of April 30, 2014)

AssetsCurrent assets
Cash and deposits

4,356,603

4,580,896

Cash and deposits in trust

5,342,609

5,642,712

Operating accounts receivable

14,11325,988Prepaid expenses

327,054

310,710Consumption taxes receivable

94,383－

Deposit paid

246,580

387,267

4,438

4,984

10,385,783

10,952,559

OtherTotal current assets
Noncurrent assets
Property, plant, and equipment
Buildings

8,618,744

8,665,447

Accumulated depreciation(511,530)(637,619)

Buildings, net

8,107,213

8,027,828

35,88235,882

Accumulated depreciation(9,220)(11,440)

Structures, net

26,661

24,442

Structures

Machinery and equipment

262,686

263,166

Accumulated depreciation(40,656)(51,338)

Structures, net

222,030

211,828

51,38752,554

Accumulated depreciation(12,368)(16,804)

Fixtures, net

39,01935,75019,555,504

19,555,504

Fixtures

Land
Construction in progress

270－

26,019,249

28,261,033

Accumulated depreciation(2,264,878)(2,662,911)

Buildings in trust, net

23,754,371

25,598,122

Buildings in trust

Structures in trust
Accumulated depreciation
Structures in trust, net

65,43469,903(12,232)(13,864)

53,20156,039Machinery and equipment in trust

210,882

237,226

Accumulated depreciation(51,084)(62,834)

Machinery and equipment in trust, net

159,797

174,391

657,444663,541

Accumulated depreciation(175,380)(191,039)

Fixtures in trust, net

482,064472,50258,650,437

54,371,985

3,267

2,785

111,053,839

108,531,180

Leasehold rights in trust－4,494,579

Total Intangible assets－4,494,579

Fixtures in trust

Land in trust
Construction in progress in trust
Total property, plant, and equipment
Intangible assets5

(Thousand yen)
Fiscal PeriodEnding October 2013(as of October 31, 2013)

Fiscal PeriodEnding April 2014(as of April 30, 2014)

Investments and other assets
Tenant leasehold and security deposits

15,227

15,227Long-term prepaid expenses

467,927

400,515

Other
Total investments and other assets
Total noncurrent assets
Total assets
Liabilities
Current liabilities
Operating accounts payableCurrent portion of long-term loans payable
Accounts payable – others
Accrued expenses
Income taxes payable, etc.
Accrued consumption taxes, etc.
Advances received
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Asset retirement obligations
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Shareholders’ capital
SurplusCapital surplus
Dividend reserve
Unappropriated retained earnings /loss
Total surplusTotal shareholders’ equity
Total net assets
Total liabilities and net assets

6

1,709

5,378

484,864

421,120

111,538,703

113,446,881

121,924,487

124,399,440

263,8932,478,500
265,90979,792605
13,824
668,264
10,853
3,781,643

389,423
10,633,000
288,992
59,131
605
52,163680,062
16,423
12,119,801

57,040,633
1,754,471
3,365,896
7,151
62,168,153
65,949,796

45,776,883
1,764,447
3,463,403
4,782
51,009,517
63,129,318

20,360,120

25,782,839

20,566,420
13,558,219
1,489,931
35,614,571
55,974,691
55,974,691
121,924,487

20,566,420
13,613,797
1,307,064
35,487,282
61,270,121
61,270,121
124,399,440

(2) Income Statement(Thousand yen)
Fiscal PeriodEnding October 2013
(from May 1, 2013
to October 31, 2013)

Fiscal PeriodEnding April 2014
(from November 1, 2013
to April 30, 2014)

Operating revenue
Rental revenue
Other rental revenue

3,942,328

4,151,072

465,120432,086

Gain on sales of real estate

165,11554,282

Total operating revenue

4,572,564

4,637,441

1,815,226

1,911,499

364,251

412,529

Operating expenses
Expenses related to rent business
Asset management fee
Asset custody fee

8,769

9,315

Administrative service fees

27,67630,401

Directors’ compensation

6,300

6,300

Other operating expenses

57,05879,485

Total operating expenses

2,279,281

2,449,531

2,293,282

2,187,910

Interest income

879

1,009

Reversal of distribution payable

827

469

Insurance Income―

303

Interest on tax refund―797

Operating income
Non-operating income

65

―

1,772

2,579

Interest expenses

542,057

553,529

Borrowing related expenses

230,111303,141

Other
Total non-operating incomeNon-operating expenses

Share issuance expenses

32,53726,753

Total non-operating expenses

804,706

883,425

Ordinary income

1,490,348

1,307,064

Income (losses) before income taxes

1,490,348

1,307,064

Income taxes – current

605

605

Total income taxes

605

605

1,489,743

1,306,459

187

604

1,489,931

1,307,064

Net income
Retained earnings brought forward
Unappropriated retained earnings/loss

7

(3) Statement of Shareholders’ Equity
Fiscal Period Ending October 2013 (from May 1, 2013 to October 31, 2013)(Thousand yen)
Shareholders’ equity

Surplus
Shareholders’capitalBalance at start of the period

14,928,800

CapitalsurplusDividend
reserve

Unappropriatedretainedearnings/loss

20,566,420

14,366,273

451,311

Total
surplus35,384,005

Total
shareholders’equityBalance atstart of theperiod

50,312,805

50,312,805

5,431,320

5,431,320

Changes during the period
Issuance of new shares

5,431,320
808,053―――

Dividends from surplus(1,259,177)(1,259,177)(1,259,177)(1,259,177)

Net income

1,489,743

1,489,743

1,489,743

1,489,743

Reversal of dividend reserve(808,053)

Total changes during the period

5,431,320―(808,053)

1,038,619

230,566

5,661,886

5,661,886

Balance at end of the period

20,360,120

20,566,420

13,558,219

1,489,931

35,614,571

55,974,691

55,974,691

Fiscal Period Ending April 2014 (from November 1, 2013 to April 30, 2014)(Thousand yen)
Shareholders’ equity

Surplus
Shareholders’capitalBalance at start of the period

20,360,120

CapitalsurplusDividend
reserve

Unappropriatedretainedearnings/loss

20,566,420

13,558,219

1,489,931

Total
surplus35,614,571

Total
shareholders’equityBalance atstart of theperiod

55,974,691

55,974,691

5,422,719

5,422,719

Changes during the period
Issuance of new shares

5,422,719(55,577)―――

Dividends from surplus(1,433,748)(1,433,748)(1,433,748)(1,433,748)

Net income

1,306,459

1,306,459

1,306,459

1,306,459

Reversal of dividend reserve

55,577

Total changes during the period

5,422,719―

55,577(182,866)(127,289)

5,295,430

5,295,430

Balance at end of the period

25,782,839

20,566,420

13,613,797

1,307,064

35,487,282

61,270,121

61,270,121

8

(4) Cash Flow Statement(Thousand yen)
Fiscal PeriodEnding April 2014
(from November 1, 2013
to April 30, 2014)

Fiscal PeriodEnding October 2013
(from May 1, 2013
to October 31, 2013)
Cash flows from operating activities
Income before income taxes

1,490,348

1,307,064

Depreciation and amortization

555,501

591,914

Share issuance expenses

32,53726,753

Interest income(879)(1,009)Interest expenses

542,057

553,529

Decrease (increase) in operating accounts receivable

16,412(11,875)

Decrease (increase) in consumption taxes receivable(94,383)

94,383

Decrease (increase) in prepaid expenses

15,727

16,344

Decrease (increase) in long-term advance charges

74,762

67,411

Decrease (increase) in deposit paid

37,351(140,686)

Increase (decrease) in accrued consumption taxes(48,756)

38,339

Increase (decrease) in operating accounts payable

48,5584,175

Increase (decrease) in accounts payable – others

36,752

23,083

Increase (decrease) in advances received

78,57925,647

Decrease by sale of property, plant, and equipment in trust

637,4096,095,227

(158)

―

Other, net(9,321)(4,847)

Subtotal

3,412,500

8,685,457

Amortization of security deposit

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

879

1,009

(545,793)(574,190)

(605)

(605)

2,866,980

8,111,670

Cash flows from investment activities
Purchase of property, plant, and equipment
Purchase of property, plant, and equipment in trust
Purchase of intangible assets in trust(111,883)(100,093)(8,856,491)(3,946,343)―(4,494,579)

Increase in tenant leasehold and security deposits

84,27150,054

Decrease in tenant leasehold and security deposits(105,068)(40,213)

Increase in tenant leasehold and security deposits in trust

529,569

469,301

Decrease in tenant leasehold and security deposits in trust(219,608)(385,293)(8,679,210)(8,447,167)

Net cash provided by (used in) investment activities
Cash flows from financing activities
Increase in long-term loans payable

3,700,000

6,000,000

Decrease in long-term loans payable(638,866)(9,109,250)

Proceeds from issuance of shares

5,398,782

5,395,966

Dividends paid

(1,256,698)(1,432,689)

Net cash provided by (used in) financing activities

7,203,217854,027

Net increase (decrease) in cash and cash equivalents

1,390,987

518,529

Cash and cash equivalents at beginning of the period

8,285,745

9,676,732

Cash and cash equivalents at end of the period

9,676,732

10,195,262

9