Kenedix Retail REIT Corporation (3453)
Translation of Japanese Original

FINANCIAL REPORT FOR THE FISCAL PERIOD ENDED MARCH 31, 2017 (REIT)(October 1, 2016 to March 31, 2017)
May 18, 2017
Kenedix Retail REIT Corporation (“KRR”) is listed on the Tokyo Stock Exchange with the securities code number 3453.
(URL http://www.krr-reit.com/en/)
Representative:
Akihiro Asano, Executive Director
Asset Management Company: Kenedix Real Estate Fund Management, Inc.
Representative:
Masahiko Tajima, CEO and President
Inquiries:
Koichiro Nobata, General Manager of Planning Department, Retail REIT Division
TEL+81-3-5623-3868
Planned submission of semiannual securities report:
Planned start of distribution payments:
Preparing presentation material:
Hold a financial brief meeting:June 29, 2017
June 15, 2017
Yes
Yes (for analysts and institutional investors)(Amounts are rounded down to the nearest million yen)

1．PERFORMANCE FOR THE FISCAL PERIOD ENDED MARCH 31, 2017 (October 1, 2016 to March 31, 2017)(1) Business Results(Percentages show period-on-period changes)
Fiscal period ended
March 31, 2017
September 30, 2016

Operating revenues
Millions of yen
6,430
6,374

%
0.9
15.0

Net income per Unit
Fiscal period ended
March 31, 2017
September 30, 2016

Operating income
Millions of yen
3,021
2,973

%
1.6
5.2

Return on net assets
Yen
6,043
6,069

Ordinary income
Millions of yen
2,556
2,519

%
1.5
3.7

Ordinary income to total assets
%
2.6
2.8

Net income
Millions of yen
2,552
2,518

%
1.4
3.7

Ordinary income to operating
revenues

%
1.4
1.5

%
39.8
39.5

(2) Distribution
Total
Distrubution ratio
distributions Total distributions Total distributions
Payout ratio
to net assets(including(excluding excess
in excess ofexcess ofof earnings)
earnings
earnings)
Fiscal period ended
Yen
Yen
Yen Millions of Yen Millions of Yen Millions of Yen%%
March 31, 2017
6,044
6,044
0
2,553
2,553
0
100.0
2.6
September 30, 2016
5,974
5,888
86
2,523
2,487
36
98.8
2.6
Note 1:
Total distributions in excess of earnings account for the distributions in regard to the allowance for temporary adjustment.
Note 2:
Due to the issuance of new investment units, the payout ratio for the fiscal period ended September 30, 2016 is calculated as follows (rounded to the nearest tenth).
Payout ratio = Total distributions (excluding excess of earnings) /Net income × 100
When calculated as follows, the payout ratio is 100.2% for the fiscal period ended September 30, 2016.
Payout ratio = Total distributions (including excess of earnings) /Net income × 100
Distributions perunit (includingexcess of
earnings)

Distributions perDistributions inunit (excludingexcess of earnings
excess of
per unit
earnings)(3) Financial Position
As ofMarch 31, 2017
September 30, 2016

Total assets
Millions of yen
185,037
179,360

Net assets
Millions of yen
96,82396,739Cash flows fromoperating activities
Millions of yen
4,211
3,234

Cash flows frominvesting activities
Millions of yen(6,002)(27,162)

Net assets to total assets

Net asset per unit
%
52.3
53.9

Yen
229,195
228,996

Cash flows fromfinancing activities
Millions of yen
2,857
25,901

Cash and cash equivalents
at the end of the period
Millions of yen
14,296
13,229(4) Cash Flows
Fiscal period ended
March 31, 2017
September 30, 2016

This is an English-language translation of the original Japanese announcement on our website released on May 18, 2017. However, no assurance or warranties are given with respect tothe accuracy or completeness of this English-language translation. The Japanese original shall prevail in the case of discrepancies between this translation and the Japanese original.
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Kenedix Retail REIT Corporation (3453)
2．EARNINGS FORECASTS FOR THE FISCAL PERIODS ENDING SEPTEMBER 30, 2017 (April 1, 2017 to September
30, 2017) AND MARCH 31, 2018 (October 1, 2017 to March 31, 2018)(Percentages show period-on-period changes)
Distributions perDistributions perDistributions in
Operating income
Ordinary income
Net income
unit (excluding
unit (includingexcess of(Millions of yen)
(Millions of yen)
(Millions of yen)excess ofexcess of
earnings per unit
earnings)
earnings)
Fiscal period ending
%
%
%
%
Yen
Yen
Yen
September 30, 2017
7,655
19.1
3,618
19.8
3,067
20.0
3,067
20.1
6,040
11
6,051
March 31, 2018
7,682
0.3
3,631
0.4
3,085
0.6
3,085
0.6
6,076
11
6,087
Reference:
Forecasted net income per unit (Forecasted net income / Forecasted average number of investment units during the period)
6,144 yen for the fiscal period ending September 30, 2017 and 6,076 yen for the fiscal period ending March 31, 2018
Note :
Distributions per unit are calculated based on the number of investment units issued and outstanding totaled 507,700 as of today.
Operatingrevenues(Millions ofyen)*OTHERS(1) Changes in Accounting Policies/Changes in Accounting Estimate/Retrospective Restatement(a) Changes in accounting policies accompanying revisions to accounting standards: None(b) Changes in accounting policies other than (a): None(c) Changes in accounting estimates: None(d) Retrospective restatement: None
(2) Number of Investment Units Issued and Outstanding (including treasury investment units)(a) Number of investment units issued and outstanding at the end of the period (including treasury investment units)
As of March 31, 2017: 422,450 units
As of September 30, 2016: 422,450 units(b) Number of treasury investment units at the end of the period
As of March 31, 2017: 0 units
As of September 30, 2016: 0 units
Note: Please refer to “Per Unit Information” on page 28 for the number of investment units used as the basis for calculating net income per unit.

* Status of audit procedures
As of the time of disclosure of this financial report, audit procedures for the financial statements pursuant to the Financial Instruments and Exchange Act of Japan are incomplete.
* Remarks on appropriate use of forecasts of performance and other special notes
Forward-looking statements presented in this financial report, including forecasts of performance, are based on information currently available to KRR and on certain assumptions KRR
deems to be reasonable. As such, actual operating and other results may differ materially from these forecasts as a consequence of numerous factors. The above-mentioned forecasts are
based on “Assumptions for the Forecasts of Financial Results for the Fiscal Periods Ending September 30, 2017 and March 31, 2018” on page 11 for calculation, and our judgment as ofNovember 16, 2016. Actual operating revenues, operating income, ordinary income, net income, distributions per unit and distributions in excess of earnings per unit may vary according
to changes in market conditions. These forecasts do not guarantee the distribution amount.

This is an English-language translation of the original Japanese announcement on our website released on May 18, 2017. However, no assurance or warranties are given with respect tothe accuracy or completeness of this English-language translation. The Japanese original shall prevail in the case of discrepancies between this translation and the Japanese original.
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Kenedix Retail REIT Corporation (3453)
1. KRR and Related Corporations
As there have been no significant changes from the “Management structure of KRR” described in the Securities Registration Statement(submitted on December 26, 2016; prepared in Japanese only), the disclosure is omitted.

3Kenedix Retail REIT Corporation (3453)
2. Investment Policies and Status of Asset Management(1) Investment Policies
KRR has changed the definition of LTV ratio on May 18, 2017 as follows, adopting the equation used by most other J-REITs.
(Before the change)
LTV ratio = (Loans payable + Investment corporation bonds + Tenant leasehold and security deposits - Amounts reserved for return oftenant leasehold and security deposits) / (Total assets - Amounts reserved for return of tenant leasehold and security deposits)(After the change)
LTV ratio = (Loans payable + Investment corporation bonds) / Total assets
Please refer “(2) Status of Asset Management, iii) Management Performance, (C) Financing” for the LTV ratios before and after the change
from the end of the first period to the end of the third period.
Besides the above change, the disclosure is omitted as there have been no other significant changes from policies described in “Investment
Policy,” “Investment Properties” and “Distribution Policy” in the Securities Registration Statement (submitted on December 26, 2016;
prepared in Japanese only).
(2) Status of Asset Management(Overview of the Period ended March 31, 2017)i) Transition of KRR
KRR was established on October 3, 2014, under the Act on Investment Trusts and Investment Corporations of Japan (the “Investment
Trust Act”). On October 30, 2014, KRR was registered with the Director-General of the Kanto Local Finance Bureau (registration
number: Director-General of the Kanto Local Finance Bureau No. 97). KRR was listed on the Real Estate Investment Trust Securities (JREIT) Market of Tokyo Stock Exchange, Inc. (the Tokyo Stock Exchange) (Securities code: 3453) on February 10, 2015. Subsequently,
KRR raised funds through public offerings, including an international offering. As a result, the number of investment units issued at the endof the period ended March 31, 2017 was 422,450 units.
KRR seeks to invest primarily in neighborhood, community and other shopping centers that cater to the day-to-day needs of local area
customers and have stable demand from retailers and customers, in order to provide stable investment returns over the long term.
Sponsored by Kenedix, Inc., a leading, independent real estate asset management company, KRR entrusts its asset management andinvestment operations to Kenedix Real Estate Fund Management, Inc. (“KFM”), with the following strategies.
Note:

For our management purposes and ease of classification, we define neighborhood, community and other shopping centers for daily needs as retailproperties that generally have the following characteristics:
a. Retail trade area of approximately a one to ten kilometer radius (and generally, a three to five kilometer radius), with customers predominantly fromlocal areas surrounding the retail property
b. Operational capacity to accommodate certain daily local retail needs and strong customer traffic on both weekdays and weekends
c. Composed of various specialty stores to meet a range of day-to-day needs such as groceries, clothing and other daily goods and servicesii) Investment Environment
There were signs of a moderate economic rebound in Japan with recoveries in employment and income environment. Real GDP growth(2nd preliminary estimate) in the fourth quarter of 2016 was positive 1.2% on an annualized basis, with capital investment leading the
growth. However, uncertainty in economy remains due to the policies of the new U.S. administration, a rise in protectionism, etc.
As for Japan’s retail market, disparities among the retail market are seen as general merchandize stores (GMS) are reported to be struggling,
but supermarkets and drugstores are performing relatively well.
The financial environment remained unstable due to global market events such as the policies of the new U.S. administration. In addition,
because of the Federal Reserve rate hike in the U.S. and the introduction of “Quantitative and Qualitative Monetary Easing with Yield
Curve Control” including the negative interest rate policy by the Bank of Japan, the market got weak as expectation of additional monetaryeasing receded. On the other hand, in the real estate market, J-REITs continue to purchase a substantial number of properties because ofmonetary easing and brisk equity raising activities by J-REITs.
iii) Management Performance(A) Acquisition of Assets
KRR acquired and started the operations of the following trust beneficiary interests in real estate (one property acquired on November 1,
2016 with acquisition price of 1,370 million yen and one property acquired on January 31, 2017 with acquisition price of 4,111 millionyen). In addition, KRR completed an additional acquisition of a new building through a property expansion within Unicus Ina (acquisition
price of 91 million yen) on January 16, 2017. As a result, the portfolio at the end of the period under review (March 31, 2017) consists 42
properties with the total acquisition price of 164,338 million yen.

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Kenedix Retail REIT Corporation (3453)
Location(City or Ward,
Prefecture)

Property
number

Property type
(Note 1)

N-5

SS

K’s Denki Shin-Moriyama (Land)

Nagoya, Aichi

T-5

NSC

Unicus Ina (Note 3)

Kitaadachi-gun, Saitama

R-9

NSC

Seiyu Rakuichi Moriya (Land)

Moriya, Ibaraki

Property nameAcquisition
price(million yen)
(Note 2)

Total
Note 1:

Acquisition date

1,370

November 1, 2016

91

January 16, 2017

4,111

January 31, 2017

5,572

Properties are categorized into the following five types of retail properties for daily needs: NSC (Neighborhood Shopping Center), SM (Supermarket), CSC(Community Shopping Center), Urban Station-Front SC (Urban Station-Front Shopping Center) and SS (Specialty Store).
We categorize these properties generally into five separate groups as follows.
Type of neighborhood, community andFeatures
Trade areaother shopping centers for daily needs
Shopping centers with a supermarket as an anchor or core tenant and several specialty
three to five
NSC (Neighborhood Shopping Centers)
store tenants
kilometer
SM (Supermarkets)

Stand-alone stores that primarily provide groceries, with a retail trade area

threekilometer

CSC (Community Shopping Centers)

Larger shopping centers than NSC, which have a supermarket as an anchor or core tenantin addition to specialty store tenants

five to ten
kilometer

Shopping centers that are located in the immediate vicinity of an urban public
three to tentransportation station, which take advantage of stable foot traffic
kilometer
Single- or multiple-tenant shopping centers that specialize in a single type of merchandise
one to ten
SS (Specialty Stores)
or service, such as drug stores, convenience stores, health clubs or electronic appliancekilometer
stores“Acquisition price” represents the purchase price of each trust beneficiary interest specified in purchase agreement in relation to the acquisition of each property(excluding acquisition costs, adjustment in property tax and city-planning tax, and consumption tax; and rounded down to the nearest one million yen).
KRR acquired the restaurant building through a new building construction (property expansion). Acquisition price represents the payment price (excluding
expenses and taxes and rounded down to the nearest million yen) on the construction contract and construction design/supervision outsourcing contracts related toconstruction of the building.
Urban Station-Front Shopping Centers

Note 2:
Note 3:

KRR also acquired a silent partnership equity interest (acquisition price: 100 million yen) of JRP8 GK, which acquired trust beneficiary interest of
Yumemachi Narashinodai Mall, to secure flexible acquisition opportunities in the future as well as opportunities for additional revenues on October 31, 2016.
Kenedix, Inc. acquired the rest of the silent partnership equity interest of JRP8 GK.

(B) Management and Operation of Assets
KFM provides property management services for all of the properties owned by KRR at the end of the period under review (March 31,2017). By using the same company for both asset management and property management services, KRR aims to build stronger
relationships with tenants and increase returns from its portfolio. Furthermore, by implementing retail property management that betterreflects the needs of our tenants, KRR strives to accumulate know-how and improve tenant satisfaction. KRR invests primarily inneighborhood and community shopping centers that cater to the day-to-day needs of customers. The portfolio is diversified in terms ofproperties, tenants and other characteristics with a goal to generate consistent long-term cash flows. At the same time, a portion of the rent
includes sales-linked rent to explore the upside potential (Note 1) for rental income. By using these measures, we aim to pursue a portfoliothat achieves both stability and growth.
As of the end of the period under review, portfolio as a whole performed well with an overall occupancy ratio of 99.6%. Furthermore, theportfolio is diversified in terms of tenants as there are 409 end-tenants (Note 2) in our retail properties.
Note 1:
Note 2:“Upside potential” represents feasibility of rental income or cash flow growth.
The number of end-tenants is the sum of the number of end-tenants in a pass-through type master lease and the number of master leassees in a sublease typemaster lease.

(C) Financing
When financing to acquire properties, KRR seeks to achieve the proper balance between financial stability and the cost of the funds withthe objectives to achieve stable medium- to long-term returns and consistent growth of assets under management.
(Debt Finance)
During the fiscal period under review, KRR borrowed 4,000 million yen for the acquisition of properties and 6,500 million yen forrefinancing. On the other hand, KRR prepaid 600 million yen using the proceeds from the issuance of investment corporation bonds.
Consequently, borrowings totaled 72,700 million yen and interest-bearing debt including investment corporation bonds (excludinginterest-bearing tenant leasehold and security deposits) totaled 74,700 million yen at the end of the fiscal period under review (March 31,2017).
5

Kenedix Retail REIT Corporation (3453)
When undertaking borrowings, we seek to spread out repayment dates and lengthen borrowing periods. On the other hand, we partiallyborrowed short-term loans from the point of flexibility under the finanacing strategy, also controlling financing cost. We may use swaps to
fix the interest payments to hedge against the risk of a rise in interest rates.
(Investment Corporation Bonds)
To diverse financing methods, KRR issued investment corporaion bonds as follows. Investment corporation bonds at the end of the period
under review (March 31, 2017) totaled 2,000 million yen. Of the total amount raised, 1,380 million yen was used for the acquisition of K's
Denki Shin-Moriyama (Land) on November 1, 2016 and certain related costs pertaining to the acquisition, and 600 million yen was used
for partial prepayment of borrowings with drawdown date of October 3, 2016.
Balance
Bonds

Issuance dateas of March 31,2017(million yen)

October 31,

1st Series Unsecured Investment Corporation Bonds

0.200

Redemption

Maturity date(%)

methodRemarks

October 29, 2021
Full onmaturity

October 31,

2nd Series Unsecured Investment Corporation Bonds
Note:

1,000

2016

Interest rate

1,000

2016

0.600

(Note)

October 30, 2026

Ranking pari passu among the specified investment corporation bonds

As a result, the average remaining years to maturity is 4.5 years, the weighted average interest rate is 0.99%, the long-term debt ratio (Note1) is 84.6% and the LTV ratio (Note 2) is 40.4%.
Note 1:
Note 2:Long-term debt ratio = (Long-term borrowings + Investment corporation bonds) / (Borrowings + Investment corporation bonds)
KRR has changed the definition of LTV ratio on May 18, 2017 as follows.
(Before the change)
LTV ratio = (Loans payable + Investment corporation bonds + Tenant leasehold and security deposits - Amounts reserved for return of tenant leasehold andsecurity deposits) / (Total assets - Amounts reserved for return of tenant leasehold and security deposits)(After the change)
LTV ratio = (Loans payable + Investment corporation bonds) / Total assets
LTV ratios before and after the definition change from the end of the first fiscal period to the end of the third fiscal period are as follows.
First fiscal period

Second fiscal period

Third fiscal period

as of September 30, 2015

as of March 31, 2016as of September 30, 2016

LTV (Before the change)

40.6%

42.7%

42.5%

LTV (After the change)

35.4%

38.3%

38.6%

(Credit Ratings)
The status of the credit ratings as of March 31, 2017 is as follows.
Credit rating agency
Details of the ratings
Long-term issuer rating
A (Outlook: Positive)
Japan Credit Rating Agency, Ltd. (JCR)
Rating on bonds
A(Shelf Registration)
KRR filed a shelf registration statement for investment corporation bonds (excluding short-term investment corporation bonds) on
September 29, 2016. Details are as follows.
Planned issue amount

100,000,000,000 yen

Planned issuance period

October 7, 2016 to October 6, 2018

Use of funds

Acquisition funds for specified assets (as defined in Article 2, Paragraph 1 of the Investment TrustLaw), repayment funds for borrowings, repayment funds for investment corporation bonds(including short-term investment corporation bonds), refund funds for lease and guarantee deposits,
funds to pay for repairs and maintenance, working capital, etc.

KRR issued 1st Series Unsecured Investment Corporetion Bonds (1,000 million yen) and 2nd Series Unsecured Investment Corporation
Bonds (1,000 million yen) on October 31, 2016, based on this shelf registration statement.
iv) Results of Operations
For this period, revenue was 6,430 million yen, operating income was 3,021 million yen, ordinary income was 2,556 million yen and net
income was 2,552 million yen.
Furthermore, in accordance with the distribution policy in the KRR Articles of Incorporation, KRR made a distribution of 2,553,287,800
yen which is almost equivalent to the earnings (as defined in Article 136-1 of Act of Investment Trust and Investment Corporations)6

Kenedix Retail REIT Corporation (3453)
excluding the reversals of allowance for temporary adjustment (as defined in Article 2-2-30 of the Ordinance on Accountings ofInvestment Corporations) for the fiscal period. Cash distributions are paid in accordance with Article 67-15 of the Special Taxation
Measures Law (Law No. 26 of 1957, including subsequent amendments).
Consequently, the distribution per unit for the fiscal period was 6,044 yen.
(Outlook)i) Outlook for Asset Management
The Japanese economy is expected to continue to recover at a moderate pace. However, we should pay attention to uncertainties about theoverseas economy and politics regarding the direction of U.S. financial policies, the policies of the new U.S. administration, etc. We alsoneed to pay attention to changes in domestic economic environment, such as fluctuation of yen due to a rise in protectionism and effects of“Quantitative and Qualitative Monetary Easing with Yield Curve Control” including the negative interest rate policy.
As for Japan’s retail sector environment, disparities among the retail market are seen as general merchandize stores (GMS) are reported to
be struggling, but supermarkets and drugstores are performing well, and we anticipate that this trend to continue.
In the real estate trading market, we anticipate the high level of transaction volume to continue because of the strong appetite of J-REITs
and other investors to acquire properties. The Bank of Japan’s monetary easing measures will help provide continuous supply of adequate
funds in the real estate market. However, investors should also keep in mind the risk of changes in banks’ lending attitude towards realestate sector, as amount of banks’ outstanding loans towards real estate sector reached new highs.
From a medium to long-term perspective, to generate a steady stream of rental revenue, consistently increase our assets and establish asuitable financial position, KRR will continue to manage assets based on the following policies.
(A) Investment Strategy for New Properties and Disposition Policy
We receive a variety of support from many sources in order to achieve the steady growth of our assets and increase the value of our assets.
One source is the Kenedix Group, including Kenedix, Inc., the parent company of KFM (Note). We also receive support from our Alliance
Companies: Sumitomo Mitsui Finance and Leasing Co., Ltd., Nippon Commercial Development Co., Ltd., P&D Consulting Co., Ltd.,and ITOCHU Corporation. We are implementing a growth strategy that takes full advantage of the external growth opportunities createdby the large and diverse acquisition pipeline made possible by the support of these companies.
When acquiring properties, we make decisions based on all applicable factors with emphasis on four parameters: the retail property’s
attractiveness, location, profitability and the tenant mix. By using this selection process, we invest in retail properties with a competitiveedge, and good prospects for consistent rental revenue and growth in asset value. We also invest in land ownership interests underlying
retail properties. Regarding land-only properties, we make these investments after examining the terms of the land leasing agreement, thecharacteristics of the tenant, the asset value of the land, and the proportion of land-only properties in our portfolio. We may also consider
making an equity investment in a tokumei kumiai (silent partnership) for the acquisition of preferential negotiation rights and opportunities
for additional revenues, provided that we are given an opportunity to acquire them in the future.
Regarding disposition of a portfolio property, we make decisions based primarily on the significance of these properties in the context ofthe portfolio. This is assessed by comprehensive evaluation of the outlook for future profitability and asset value determined based on its
current profitability and market trends.
Note :The Kenedix Group consists of Kenedix, Inc. and its subsidiaries and affiliates.

(B) Management Strategy for Existing Properties
KRR is committed to building a portfolio that can pursue both stability and growth. We believe that implementing integrated asset andproperty management services makes it possible to properly manage retail properties and pursue internal growth. Furthermore, thisintegrated management framework facilitates activities to enliven local communities where our properties are located, enabling us to aim
for medium to long-term growth in asset value.
To accomplish these goals, KFM oversees properties owned by KRR while placing priority on the following themes.
・“One-stop” asset management and property management services
・Continuously implementing a retail property management cycle through our in-house property management services
・Pursuit of internal growth through management of retail properties
・Directing investments and management policies to enliven local communities in the medium to long-term“One-stop" asset management and property management services
KRR plans to use the integrated asset management and property management services of KFM for strengthening relationships with tenants
and making the portfolio more profitable.

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Kenedix Retail REIT Corporation (3453)
Continuously implementing a retail property management cycle through our in-house property management services
KFM provides property management services for all of KRR’s properties. We do this for the purposes of performing retail property
management that better reflects the needs of the tenants as well as accumulating know-how and improving tenant satisfaction. Specifically,
we use direct contact with tenant companies at our properties in order to strengthen tenant relationships and make properties more
profitable. To this end, we maintain periodic communication with tenants and perform questionnaire surveys to customers for monitoringof market conditions, so that we can identify the needs of tenants and the customers visiting their sites. This process makes it possible tofind issues that stand in the way of achieving greater satisfaction for tenants and their customers. Once we have discovered points that
require attention, we take actions that take full advantage of the resources and knowledge regarding retail properties within the Kenedix
Group. Solutions include measures such as the effectively utilizing capital expenditures, optimizing tenant mix, realizing growth in asset
value by pursuing property expansions, and cutting costs, to improve tenant satisfaction and acquire more know-how.
Pursuit of internal growth through management of retail properties
KRR seeks to use the proper management of retail properties to achieve the goals of consistent revenue, higher profitability and growth inasset value.
i. Effectively utilize capital expenditure
We will use proper and well-timed capital expenditures to increase the satisfaction of tenants and make our properties more competitive.
ii. Optimize tenant mix
We will constantly work on attracting new tenants that are highly appealing to shoppers and replace tenants with others, optimizing
tenant composition, in order to seek stable revenue and higher profitability by attracting more customers.
iii. Realize growth in asset value by pursuing property expansions
We will use the extensive knowledge involving retail properties of the Kenedix Group and our Alliance Companies to utilize theunderutilized space (note) at properties and expand properties. These measures will take into account the competitive position of each
property, the effect on our financial position and other factors. By increasing space that can be leased, we would like to increase revenue
and asset value.
Note:

The underutilized space is defined as the area that is calculated by multiplying the floor space ratio, or the ratio of total area of the building to the site area, which isprescribed in Article 52 of the Building Standards Act (Act No. 201 of 1950, including subsequent amendments.) and applied to each retail property in accordancewith the Building Standards Act, City Planning Act (Act No. 100 of 1968, including subsequent amendments.) and other laws and regulations, by the land area thatis allowed to be used as a retail property site, and subtracting from this figure the actual gross floor area of the building.

Directing investments and management policies to enliven local communities in the medium to long-term
At our retail properties, we seek tenants that provide services, hold community involved events and use other measures to help enliven thelocal communities where our properties are located. We believe these activities will contribute to the medium to long-term growth in theasset value of these properties.
(C) Financing
We will establish a suitable financial foundation by examining numerous financing methods and selecting the optimum ones. These
decisions will reflect interest rates and other elements of the financial environment. Our goal is to select financing methods that result in the
optimum balance between financial stability and the financing cost.
(D) Disclosure of Information
Our policy concerning disclosure activities is to use extensive investor relations activities to distribute a broad range of information toinvestors and other related parties as well as to announce information as soon and as accurately as we can. We use TDnet (Timely
Disclosure network) and press releases to meet the timely-disclosure requirements of the Tokyo Stock Exchange. In addition, we
proactively post information on our website (http://www.krr-reit.com/en/).
(E) Conflicts of Interest
In addition to managing the assets of KRR, KFM provides asset management services to other investment corporations and real estate
funds. KFM uses a “preferential right for acquisition opportunities” system for the property acquisition process. KFM has a pipeline
committee, which includes a compliance officer, and operates in accordance with rules. This system is structured to prevent improper
allocation of acquisition opportunities as well as conflicts of interest among the REIT and funds managed by KFM. Through thesemeasures, KFM is taking suitable actions regarding conflicts of interest.
(F) Important Subsequent Events
KRR passed resolutions at the Board of Directors Meeting held on March 31, 2017 and April 11, 2017, to issue new investment units tofund the acquisition of specified assets. Payments for the issuance of new investment units through public offering and through third-party
8

Kenedix Retail REIT Corporation (3453)
allotment have been completed on April 18, 2017 and May 17, 2017, respectively. KRR plans to use the net proceeds through third-party
allotment for the repayment of the short-term loans payable.
As a result, unitholders' capital totaled 113,399,022,050 yen and total number of investment units issued and outstanding increased to507,700 as of May 17, 2017.
Issuance of new investment units through public offerings
Total number of units issued:
Issue price (offer price):
Total amount of issue price (total offer price):
Paid-in amount (issue amount):
Total paid-in amount (total issue amount):
Payment date:81,250 units (Domestic 44,592 units, International 36,658 units)
232,537 yen per unit
18,893,631,250 yen
224,547 yen per unit
18,244,443,750 yen
April 18, 2017

Issuance of new investment units through third-party allotment
Total number of units issued:
Paid-in amount (issue amount):
Total paid-in amount (total issue amount):
Payment date:
Allottee:

4,000 units
224,547 yen per unit
898,188,000 yen
May 17, 2017
SMBC Nikko Securities Inc.

9

Kenedix Retail REIT Corporation (3453)(Reference Material)(A) Acquisition of Assets
KRR acquired 8 assets (acquisition price of 32,664 million yen).
“Acquisition price” represents the amount specified in the sale and purchase agreement for the trust beneficiary interests, exclusive of thevarious expenses (acquisition expenses, property tax, city planning tax, consumption tax, etc.) required in the acquisition of the following
assets.
Acquisition price(million yen)Appraisal value(million yen)

Acquisition date

4,170

4,290

April 19, 2017

3,416

3,520

April 19, 2017

3,097

3,220

May 18, 2017

2,820

2,850

April 19, 2017

Sumitomo Mitsui Finance andLeasing Co., Ltd.

1,880

1,970

April 19, 2017

Round1 Stadium HakataHanmichibashi

Fukuoka, Fukuoka Sumitomo Mitsui Finance andLeasing Co., Ltd.

5,020

5,190

April 19, 2017

NSC

Kurume-Nishi Shopping Center

Kurume, Fukuoka M&K Tokutei Mokuteki Kaisha

1,515

1,600

April 19, 2017NSC

Sun Street Hamakita

10,746

10,890April 27, 201732,66433,530-Property
number

Propertytype

Property nameLocation

SellerT-18

NSC

Totsuka-Fukaya Shopping Center(Land)

Yokohama,
Kanagawa

Sumitomo Mitsui Finance andLeasing Co., Ltd.

T-19

NSC

Yumemachi Narashinodai Mall

T-20

NSC

Kawamachi Yahagi Mall

T-21

SS

Prime Square Jiyugaoka

Meguro-ku, Tokyo Undisclosed (Note)

T-22

SS

Round1 Ichikawa-Onitaka

Ichikawa, Chiba

F-2

SS

F-3
R-10

Total

Funabashi, Chiba JRP8 GK
Chiba, Chiba

Hamamatsu,
Shizuoka

GK KRF63

JRP9 GK--

Note : Undisclosed as KRR has not obtained consent from the previous owner.

(B) Financing
KRR borrowed funds for the acquisitions on April 19, 2017 (1,200 million yen for Series 11), on April 27, 2017 (11,300 million yen for
Series 13) and on May 18, 2017 (3,200 million yen for Series 14) and for the repayment of the borrowings on April 21, 2017 (5,570 million
yen for Series 12).
KRR also entered into agreements on commitiment lines on March 31, 2017 to secure flexibility and stability in financing method, forpotential needs of funds as follows.
Counterparty

Limit of maximum amount(million yen)Contract period

Remarks

Sumitomo Mitsui Banking Corporation

1,000

April 1, 2017 to March 31, 2018

Unsecured, unguaranteed

Mizuho Bank, Ltd

1,000

April 1, 2017 to March 31, 2019

Unsecured, unguaranteed

10Kenedix Retail REIT Corporation (3453)
ii) Earnings Forecasts
For the fiscal period ending September 30, 2017 (from April 1, 2017 to September 30, 2017) and the fiscal period ending March 31, 2018(from October 1, 2017 to March 31, 2018), the earnings forecasts are estimated as set forth below.
Fiscal period ending September 30, 2017
Operating revenues

7,655 million yen

Operating Income

3,618 million yen

Ordinary income

3,067 million yen

Net Income

3,067 million yen

Distributions per unit

6,051 yen

Of the above, distributions in excess of earnings

11 yenFiscal period ending March 31, 2018
Operating revenues

7,682 million yen

Operating Income

3,631 million yen

Ordinary income

3,085 million yen

Net Income

3,085 million yen

Distributions per unit

6,087 yen

Of the above, distributions in excess of earnings

11 yenPlease refer to “Assumptions for the Earnings Forecasts for the Fiscal Periods Ending September 30, 2017 and March 31, 2018” set forth
below for information on current assumptions for the forecasts of operating results.
After the end of the fourth fiscal period, KRR issued new units, made new borrowings and acquired properties. Accordingly, KRR has
updated the assumptions for the “Forecasts of Financial Results and Distributions for the Fiscal Periods Ending September 30, 2017, andthe Forecast of Financial Results and Distributions for the Fiscal Period Ending March 31, 2018” released on March 31, 2017, but there are
no changes in the forecast figures.
Note:

The above forecasts are based on certain assumptions for calculation, and our judgment as of today. Actual operating revenues, operating income, ordinary
income, net income, distributions per unit and distributions in excess of earnings per unit may vary due to changes in market conditions. These forecasts do notguarantee the distribution amount.

Assumptions for the Earnings Forecasts for the Fiscal Periods Ending September 30, 2017 and March 31, 2018
Item
Calculation period

Property portfolio

Operating revenues

Operating expenses

Assumptions
・The 5th fiscal period: April 1, 2017 to September 30, 2017 (183 days)
・The 6th fiscal period: October 1, 2017 to March 31, 2018 (182 days)
・It is assumed that there will be no changes (any acquisition of new properties or any sale of existing
properties, etc.) in property portfolio of 50 assets, which are 42 existing assets (the “existing assets”) as ofMarch 31, 2017 and 8 assets acquired on April 19, 2017, April 27, 2017 and May 18, 2017 (the “asset
acquired in the fifth fiscal period”), by the end of the fiscal period ending March 31, 2018.
・The actual property portfolio may change due to the acquisition of new properties other than the asset
acquired in the fifth fiscal period or the disposal of owned properties, etc.
・Operating revenues of the existing assets are based on leasing agreements as of March 31, 2017, trend oftenants, real estate market trends and other factors.
・Operating revenue of the asset acquired in the fifth fiscal period is based on its operating revenues
calculated by the information provided by the sellers, leasing agreements as of March 31, 2017, trend oftenants, real estate market trends and other factors.
・Operating revenues are based on the assumption that there will be no rent in arrears or non-payments by thetenant.
・Property-related operating expenses other than depreciation are calculated based on historic data, etc., andthese costs reflect fluctuations in the costs, including leasing costs based on the leasing agreements.
・Depreciation expenses of 868 million yen, and 871 million yen are assumed for the fiscal periods ending
September 30, 2017 and March 31, 2018 respectively, using the straight-line depreciation method.
・563 million yen and 563 million yen of property related taxes are expected to be expensed during the fiscal
periods ending september 30, 2017 and March 31, 2018 respectively. For the properties acquired afterJanuary 1, 2017, property-related taxes are not expensed in the fiscal period ending March 31, 2018
because KRR reimbursed the seller, pursuant to the purchase agreement, for the pro rata portion of theproperty-related taxes. 99 million yen per fiscal period is expected when the property related taxes for theproperties are expensed.
・With respect to building repair expenses, the amount assumed to be necessary for each property is based on
the repair plan of KFM for each fiscal period. However, repair expenses may be substantially different
from the expected amount due to certain unexpected factors.

11Kenedix Retail REIT Corporation (3453)
Item

Assumptions

・The amortization of offering-related costs are expected to be expensed 96 million yen and 84 million yen
for the fiscal periods ending September 30, 2017, and March 31, 2018, respectively. It is assumed that the
Non-operating expenses
offering-related costs are amortized using the straight-line method over 3 years.
・For interest expenses and other debt-related costs, 448 million yen and 454 million yen are expected for the
fiscal periods ending September 30, 2017, and March 31, 2018, respectively.
・As of today, KRR has an outstanding balance of 88,400 million yen in borrowings and 2,000 million yen in
investment corporation bonds. It is also assumed that a portion of the short-term loans payable will be
repaid in the fiscal period ending September 30, 2017 with the proceeds from the third-party allotment of
Borrowings
investment units.
and・The LTV ratio is expected to be 40.5% and 40.5% at the end of the period ending September 30, 2017 andinvestment corporation bonds
March 31, 2018, respectively. (rounded to the nearest tenth)・The LTV ratio has been calculated according to the following formula:
LTV ratio =(Loans payable + Investment corporation bonds) / Total assets
・The forecasts are based on our assumption of 507,700 units issued as of today. It is assumed that there will
Investment units
be no changes in the number of investment units due to the new issuance of units until the end of the fiscal
period ending March 31, 2018.
・Distributions per unit (excluding excess of earnings per unit) are calculated in accordance with the
distribution policy outlined in our Articles of Incorporation.
・We assume that there is no effect from the changes in market value of swaps on the distributions per unit
Distributions per unit
(excluding excess of earnings
for the fiscal periods ending September 30, 2017 and March 31, 2018.
per unit)・Actual distributions per unit (excluding excess of earnings per unit) may fluctuate due to various factors
including movements in investment assets, fluctuations in rental revenues caused by tenant replacements,
or unexpected repairs.
・We expect to record Allowance for Temporary Adjustment (ATA) to adjust the temporary differences
between treatment of certain transactions under Japanese GAAP and Japanese tax laws in relation to
Sunny Noma, which results from the depreciation of fixed term land lease right for business purposes, theDistributions in excess of
expensed interest from asset retirement obligations and deprecation of buildings, during the relevant period
earnings per unit
(30 years starting from March 16, 2007).
・KRR has a policy to distribute the amount of increase in ATA, in excess of its earnings. Distributions inexcess of earnings are expected to be 11 yen per unit and 11 yen per unit in the periods ending September
30, 2017 and March 31, 2018, respectively.
・Forecasts are based on the assumption that there will be no amendments to the law, taxation system,
accounting standards, public listing regulations, requirements of the Investment Trusts Association, Japan,
Othersetc. that may affect the aforementioned forecast figures.
・Forecasts are based on the assumption that there will be no unexpected. Significant changes in general
economic trends and real estate market trends or other conditions.

iii) Risk Factors
There are no significant changes to the “Investment Risks” in described in the Securities Registration Statement (submitted on March 31,
2017; prepared in Japanese only), the disclosure is omitted.

12Kenedix Retail REIT Corporation (3453)
3. Financial Statements(1) Balance Sheets(in thousands of yen)

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Non-current assets
Property, plant and equipment
Construction in progress
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment, net
Intangible assets
Leasehold right in trust
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Lease and guarantee deposits in trust
Long-term prepaid expenses
Long-term deposits
Other
Total investments and other assets
Total non-current assets
Deferred assets
Organization costs
Investment corporation bond issuance costs
Investment unit issuance costs
Total deferred assets
Total assets

*1

*1

*1
*1

13

Third Fiscal Period(As of September 30, 2016)

Fourth Fiscal Period(As of March 31, 2017)

4,367,293
11,615,129
206,398
112,712477,707432
16,779,673

5,258,633
11,575,715
182,993
41,0202,987
17,061,349

35,24342,409,745(1,707,093)
40,702,651
1,808,630(106,872)
1,701,758
203,295(6,582)
196,71251,813(6,700)45,112
118,225,350
12,015160,918,844

42,757,457(2,377,464)
40,379,992
1,822,887(145,181)
1,677,705
203,295(11,445)
191,850
60,635(10,639)
49,995
123,937,095
24,784
166,261,423

524,576
1,883
526,460

520,598
2,064
522,662

10,00036,035651,956
124,960
822,951
162,268,256

101,690
10,00036,035648,066
124,960
23,395944,147
167,728,234

30,369281,763
312,132
179,360,062

25,331
17,671
204,840
247,843
185,037,427

Kenedix Retail REIT Corporation (3453)(in thousands of yen)

Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Accounts payable-otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Deposits received
Total current liabilities
Non-current liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
Deduction from unitholders' capital
Allowance for temporary difference adjustments
Total deduction from unitholders' capital
Unitholders' capital, net
Surplus
Unappropriated retained earnings
Total surplus
Total unitholders' equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets*1

Third Fiscal Period(As of September 30, 2016)

Fourth Fiscal Period(As of March 31, 2017)

453,515
12,070,000
267,670
7,108
1,081
859,300
122,669
13,781,345

516,631
11,470,000
3,850,000
280,035
12,501
3,275
245,842878,241
124,240
17,380,767

57,230,000
2,500
11,518,586

68,838,953
82,620,298

2,000,000
57,380,000
11,397,149
23,33532,63970,833,124
88,213,892

94,256,390

94,256,390(4,263)(4,263)
94,252,127(40,593)(40,593)
94,215,796

2,518,802
2,518,802
96,770,929

2,584,343
2,584,343
96,800,139(31,166)(31,166)
96,739,763
179,360,062

23,39523,39596,823,535
185,037,427

23,19064,677*2*3

14

Kenedix Retail REIT Corporation (3453)(2) Statements of Income and Retained Earnings
Third Fiscal Period(From April 1, 2016
to September 30, 2016)
Operating revenues
Rent revenue-real estate
Other lease business revenue
Dividends income
Total operating revenues
Operating expenses
Expenses related to rent business
Asset management fees
Asset custody fees
Administrative service fees
Directors' compensation
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Interest on refund
Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds
Financing-related expenses
Amortization of organization costs
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance costs
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes
Current
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings(in thousands of yen)
Fourth Fiscal Period(From October 1, 2016
to March 31, 2017)*1*1

5,405,789
968,378
6,374,168

5,524,740
902,7403,1316,430,612*1

2,860,183
438,769
6,375
21,792
4,500
69,0523,400,673
2,973,494

2,817,984
488,477
7,549
23,972
4,500
67,0393,409,522
3,021,090

51
251
303

52
164
217

306,343
65,7805,066
76,922454,1132,519,684
2,519,684

310,372
3,337
67,385
5,038
1,404
76,922
464,4592,556,848
2,556,848

1,088
1,088
2,518,595
206
2,518,802

3,922
3,922
2,552,926
31,4172,584,343

15

Kenedix Retail REIT Corporation (3453)(3) Statements of Changes in Net Assets
Third Fiscal Period (From April 1, 2016 to September 30, 2016)(in thousands of yen)
Unitholders' equity

Unitholders' capital
Deduction from unitholders' capital
Allowance for
Total deduction
temporaryfrom unitholders'difference
capitaladjustments

Unitholders'
capitalBalance at the beginning of theperiodChanges of items during theperiodIssuance of new investment
units

77,606,649--

16,649,740

Surplus
Unitholders'
capital, net

Unappropriatedretained earnings

77,606,649

2,427,985(4,263)(4,263)

Balance at the beginning of theperiodChanges of items during theperiodIssuance of new investment
units

80,034,634(2,427,778)(4,263)(2,427,778)(4,263)2,518,595

2,518,595

2,518,595

16,649,740(4,263)(4,263)

16,645,477

90,81790,817

16,736,294

94,256,390(4,263)(4,263)

94,252,127

2,518,802

2,518,802

96,770,929

Valuation and translation
adjustments
Total valuation
Deferred gains or
and translation
losses on hedges
adjustments

Total net assets

*1

-

-

80,034,634

16,649,740

Dividends from surplus(2,427,778)

Distributions in excess ofearnings from allowance fortemporarydifference
adjustments(4,263)

Net income
Net changes of items otherthan unitholder’s equity
Total changes of items during
the period
Balance at the end of theperiodTotalunitholders'equity16,649,740(2,427,778)

Net income
Net changes of items otherthan unitholder’s equity
Total changes of items during
the period
Balance at the end of theperiod2,427,985

16,649,740

Dividends from surplus
Distributions in excess ofearnings from allowance fortemporarydifference
adjustments

Total
surplus2,518,595(31,166)(31,166)(31,166)(31,166)(31,166)

16,705,128(31,166)(31,166)

96,739,763

16

Kenedix Retail REIT Corporation (3453)
Fourth Fiscal Period (From October 1, 2016 to March 31, 2017)(in thousands of yen)
Unitholders' equity

Unitholders' capital
Deduction from unitholders' capital
Allowance for
Total deduction
temporaryfrom unitholders'difference
capitaladjustments

Unitholders'
capitalBalance at the beginning of theperiodChanges of items during theperiod94,256,390(4,263)(4,263)

Surplus
Unappropriatedretained earnings

94,252,127

2,518,802

2,518,802

96,770,929(2,487,385)(2,487,385)(2,487,385)

Dividends from surplus
Distributions in excess ofearnings from allowance fortemporarydifference
adjustments(36,330)(36,330)(36,330)

Net income
Net changes of items otherthan unitholder’s equity
Total changes of items during
the period
Balance at the end of theperiodBalance at the beginning of theperiodChanges of items during theperiod(36,330)
2,552,926

2,552,926

2,552,926-(36,330)(36,330)(36,330)

65,54065,54029,20994,256,390(40,593)(40,593)

94,215,796

2,584,343

2,584,343

96,800,139

Valuation and translation
Adjustments
Total valuation
Deferred gains or
and translation
losses on hedges
adjustments

Total net assets*1(31,166)(31,166)

Dividends from surplus

96,739,763(2,487,385)

Distributions in excess ofearnings from allowance fortemporarydifference
adjustments(36,330)

Net income

2,552,926

Net changes of items otherthan unitholder’s equity
Total changes of items during
the period
Balance at the end of theperiodTotal
surplusTotal
unitholders'equityUnitholders'
capital, net

54,56254,56254,56254,56254,562

83,772

23,39523,39596,823,535

17

Kenedix Retail REIT Corporation (3453)(4) Statements of Cash Distributions(yen)
Third Fiscal Period(From April 1, 2016 to September 30, 2016)

Fourth Fiscal Period(From October 1, 2016 to March 31, 2017)I.

Retained earnings at the end of period

2,518,802,609

2,584,343,087

II.

Distributions in excess of earnings

36,330,700-

Of which, allowance for temporary difference
adustments

36,330,700-

Incorporation into unitholders' capital-

30,838,850

Of which, reversal of allowance for temporary
difference adjustments-

30,838,850

2,523,716,300

2,553,287,800

5,974

6,044

2,487,385,600

2,553,287,800

5,888

6,044

36,330,700

-

86

-

31,417,009

216,437

In accordance with the policy described in Article 39-1
of its Articles of Incorporation, KRR determines that theamount of distribution shall exceed the amount equivalent
to 90% of its distributable profit as stipulated in Article
67-15 of the Special Taxation Measures Law and shall be
up to its profits as the maximum amount. Following thispolicy, KRR has decided that it shall distribute¥2,487,385,600 which is almost the entire amount ofincome as defined in Article 136-1 of the Investment
Trust Act. Procedures for the distribution of amounts
exceeding distributable income are outlined in Article 392 of KRR’s Articles of Incorporation.
Furthermore, in accordance with the policy for“Distribution of Money in Excess of Profits” as stated in
Article 39-2 of KRR’s Articles of Incorporation, KRR
made a distribution in excess of earnings of ¥36,330,700
for allowance for temporary difference adjustments (asdefined in Article 2-2-30 of the Ordinance on
Accountings of Investment Corporations) for the purposeof reflecting the effect on distributions of the difference inearnings calculated under Japanese GAAP and Japanese
tax laws (as defined in Article 2-2-30 (a) of the Ordinanceon Accountings of Investment Corporations) in
association with the amortization of fixed-term landleasehold rights and of the item deducted from net asset(as defined in Article 2-2-30 (b) of the Ordinance on
Accountings of Investment Corporations) in association
with deferred losses on hedges.

In accordance with the policy described in Article 39-1
of its Articles of Incorporation, KRR determines that theamount of distribution shall exceed the amount equivalent
to 90% of its distributable profit as stipulated in Article
67-15 of the Special Taxation Measures Law and shall be
up to its profits as the maximum amount. Following thispolicy, KRR has decided that it shall distribute¥2,553,287,800 which is almost the entire amount ofincome as defined in Article 136-1 of the Investment
Trust Act after deduction of reversal of allowance fortemporary difference adjustments (as defined in Article 22-30 of the Ordinance on Accountings of Investment
Corporations).
Procedures for the distribution of amounts exceeding
distributable income are outlined in Article 39-2 of KRR’s
Articles of Incorporation. In the fourth fiscal period,
KRR has decided not to distribute cash in excess of
distributable profit.

III.

IV.

Total 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, distributions in excess of earnings perunit (allowance for temporary difference
adjustments)
V.
Retained earnings brought forward to the next
periodMethod of calculating distribution amount18

Kenedix Retail REIT Corporation (3453)(5) Statements of Cash Flows(in thousands of yen)

Third Fiscal Period

Fourth Fiscal Period(From April 1, 2016
to September 30, 2016)(From October 1, 2016
to March 31, 2017)

Net cash provided by (used in) operating activities
Income before income taxes

2,519,684

2,556,848

Depreciation and amortization

714,452

721,929

5,066

5,038

-

1,404

76,922

76,922

Amortization of organization costs
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance costs
Interest income

(51)

(52)

Interest expenses

306,343

313,709

Decrease (increase) in operating accounts receivable(14,367)

23,405Decrease (increase) in consumption taxes receivable

32,815

477,707

Decrease (increase) in prepaid expenses(78,961)

71,692

Increase (decrease) in operating accounts payable(25,321)(2,220)

Increase (decrease) in accounts payable-other(19,393)

11,825-245,842

Increase (decrease) in advances received

111,123

18,941

Increase (decrease) in deposits received(13,799)

1,571

Decrease (increase) in long-term prepaid expenses(68,932)

3,889

Other

(4,103)(6,558)Subtotal

3,541,476

4,521,894

Increase (decrease) in accrued consumption taxes

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

51

52(305,756)(308,315)(940)(1,728)3,234,831

4,211,903

Net cash provided by (used in) investing activities(35,243)-(28,233,179)(5,994,725)

Purchase of intangible assets in trust

-

(504)

Purchase of investment securities-(101,690)

Proceeds from investment securities

-

3,131

(20)

-

Purchase of property, plant and equipment
Purchase of property, plant and equipment in trust

Payments for lease and guarantee deposits in trust
Proceeds from tenant leasehold and security deposits

2,500

-

Repayments of tenant leasehold and security deposits in trust(314,140)(317,595)

Proceeds from tenant leasehold and security deposits in trust

1,202,094

193,659

Proceeds from restricted bank deposits in trust
Net cash provided by (used in) investing activities

215,676

215,676(27,162,312)(6,002,048)

Net cash provided by (used in) financing activities
Proceeds from short-term loans payable

6,370,000

6,500,000

Payments in short-term loans payable(800,000)(7,100,000)

Proceeds from long-term loans payable

6,230,000

4,000,000-

1,980,924

Proceeds from issuance of investment corporation bonds
Proceeds from issuance of investment units

16,531,819-

Payments of dividends(2,430,448)(2,523,176)
2,857,747

Net cash provided by (used in) financing activities

25,901,371

Net increase (decrease) in cash and cash equivalents

1,973,891

1,067,602

Cash and cash equivalents at the beginning of the period

11,255,410

13,229,301

13,229,301

14,296,903

Cash and cash equivalents at the end of the period*119Kenedix Retail REIT Corporation (3453)（6）Notes on Assumption of Going Concern
Not applicable（7）Summary of Significant Accounting Policies
1. Evaluation standards andevaluation method of assets

Securities
Other securitiesThose with no fair value
Cost method through moving-average method
Concerning silent partnership equity interests, the method of incorporating the amount of equity equivalent to the portion that
corresponds to the net gain or loss of the silent partnership is adopted.

2.Method of depreciation of noncurrent assets(1) Property, plant and equipment (including trust assets)
The straight-line method is applied.
Useful lives of the assets ranging are as follows:
Buildings: 2 to 70 years
Structures: 8 to 59 years
Machinery and equipment: 10 to 25 years
Tools, furniture and fixtures: 4 to 10 years(2) Intangible assets (including trust assets)
The straight-line method is applied.
(3) Long-term prepaid expenses
The straight-line method is applied.

3. Accounting for deferred assets(1) Organization costs
Organization costs are amortized over a period of 5 years under the straight-line method.
(2) Investment unit issuance costs
Investment unit issuance costs are amortized over a period of 3 years under the straight-line method.
(3) Investment corporation bond issuance costs
Investment corporation bond issuance costs are amortized over a maturity period under the straight-line method.

4. Accounting for revenues andexpenses

Accounting for property-related taxes
Property-related taxes including property taxes, city planning taxes and depreciable property taxes are imposed on properties on acalendar year basis. These taxes are generally charged to operating expenses for the period, for the portion of such taxes
corresponding to said period. Under Japanese tax regulations, the seller of the property is liable for these taxes on the property fromthe date of disposal to the end of the calendar year in which the property is disposed. The seller, however, is reimbursed by thepurchaser for these accrued property-related tax liabilities.
When KRR purchases properties, it typically allocates the portion of the property-related taxes related to the period following thepurchase date of each property through the end of the calendar year. The amounts of those allocated portions of the property-related
taxes are capitalized as part of the acquisition costs of the related properties. Capitalized property-related taxes amounted to 106,443
thousand yen and 21,351 thousand yen as of September 30, 2016 and March 31, 2017, respectively.

4. Method of hedge accounting(1) Hedge accounting method
Deferral hedge accounting is applied. However, the special treatment is applied for the interest-rate swap agreements that meetthe criteria for special treatment.
(2) Hedging instruments and hedged items
Hedge instruments
Interest-rate swap transactions
Hedged items
Interest payments on debts(3) Hedging policy
KRR enters into derivative transactions based on its risk management policies with the objective of hedging risks provided in its
Articles of Incorporation.
(4) Method of assessing the effectiveness of hedging
As for the method of assessment of the effectiveness of the hedge in the period from the inception of the hedge to the time of
judgment of its effectiveness, the cumulative changes in cash flow of the hedged items and hedging instruments are compared
and a judgment is made based on changed amount, etc. However, an assessment of the effectiveness of hedging activities isomitted in the case of interest rate swaps that meet the requirements for special treatment.

5. Scope of cash and cash
equivalents on statements of cash
flows

Cash and cash equivalents consist of cash on hand, deposits placed with banks and short-term investments which are highly liquid,readily convertible to cash and with insignificant risk of market value fluctuation, with maturities of three months or less from thedate of purchase.

6. Other significant accounting
policies for the preparation offinancial statements(1) Accounting method for trust beneficiary interests in real estate and other assets
The assets and liabilities as well as revenues and expenses of financial assets held in the form of trust beneficiary interests in realestate and other assets are recorded in full in KRR’s balance sheet and statement of income and retained earnings.
Of the assets in trust accounted for under the respective account items, the following significant items are separately indicated on
the balance sheet.
1. Cash and deposits in trust
2. Buildings in trust, structures in trust, machinery and equipment in trust, tools, furniture and fixtures in trust, land in trust,construction in progress in trust
3. Leasehold right in trust
4. Lease and guarantee deposits in trust
5. Tenant leasehold and security deposits in trust(2) Accounting method for consumption taxes
Consumption taxes are separately recorded. Non-deductible consumption taxes applicable to the acquisition of assets areincluded in the cost of acquisition for each asset.

20

Kenedix Retail REIT Corporation (3453)(Additional Information)(Notes to Allowance for Temporary Difference Adjustments Additions and Reversals)
Third Fiscal Period (From April 1, 2016 to September 30, 2016)
1. Reasons, related assets and allowance
Related assets, etc.

(in thousands of yen)
Allowance for temporary
difference adjustments

ReasonBuildings in trust,
Leasehold right in trust
Deferred gains or losses onhedgesAmortization of leasehold right in trust and the amount in excess ofdepreciation

5,491

Loss on interest-rate swaps recognized at the end of the fiscal period

30,838

2. Method of reversal
Method of reversal
Buildings in trust,
Leasehold right in trust
Deferred gains or losses onhedgesUpon sale, the corresponding amount is scheduled to be reversed.
Based on changes in the fair value of the hedging instruments, the corresponding amount is scheduled to be reversed.

Fourth Fiscal Period (From October 1, 2016 to March 31, 2017)
1. Reasons, related assets and reversal of allowance
Related assets, etc.

(in thousands of yen)
Reversal of allowance for temporary
difference adjustments

ReasonDeferred gains or losses onhedgesChanges in the fair value of derivative instruments

30,838

2. Method of reversal
Method of reversal
Buildings in trust,
Leasehold right in trust
Deferred gains or losses onhedgesUpon sale, the corresponding amount is scheduled to be reversed.
Based on changes in the fair value of the hedging instruments, the corresponding amount is scheduled to be reversed.

(8) Notes to Financial Statements(Notes to Balance Sheets)* 1. Assets pledged as collateral and relevant secured liabilities:(in thousands of yen)
Assets pledged as collateral

Third Fiscal Period
As of September 30, 2016

Fourth Fiscal Period
As of March 31, 2017

Buildings in trust

2,755,048

2,724,085

Structures in trust

53,94752,355Tools, furniture and fixtures in trust

2,962

2,661

7,811,297

7,811,297

10,623,255

10,590,399

Land in trust
Total
Secured liabilities

Third Fiscal Period
As of September 30, 2016

Tenant leasehold and security deposits in trust
Total

Fourth Fiscal Period
As of March 31, 2017
3,468,617

3,245,943

3,468,617

3,245,943* 2. Allowance for temporary difference adjustments
Third Fiscal Period (As of September 30, 2016)
1. Reasons, related assets, initial amount and allowance(in thousands of yen)
Related assets, etc.

ReasonBuildings in trust,
Leasehold right in trust

Amortization ofleasehold right in trust
and the amount in excess
of depreciation

Initial amount

Balance atthe beginningof the period

Allowance
during theperiod

4,263

-

4,263

2. Method of reversal
Method of reversal
Buildings in trust,
Leasehold right in trust

Upon sale, the corresponding amount is scheduled to be reversed.

21

Reversalduring theperiodBalance atthe end of theperiod-4,263

Reason forreversal-

Kenedix Retail REIT Corporation (3453)
Fourth Fiscal Period (As of March 31, 2017)
1. Reasons, related assets, initial amount and allowance(in thousands of yen)
Related assets, etc.

ReasonInitial amount

Balance atthe beginningof the period

Allowance
during theperiod

9,754

4,263

5,491

-

9,754

-

30,838-30,838-30,838-40,593

4,263

36,330-40,593-

Amortization ofleasehold right in trust
and the amount in excess
of depreciation
Loss on interest-rate
swaps recognized at theend of the fiscal period

Buildings in trust,
Leasehold right in trust
Deferred gains orlosses on hedges

Total

Reversalduring theperiodBalance atthe end of theperiodReason forreversal

2. Method of reversal
Method of reversal
Buildings in trust,
Leasehold right in trust

Upon sale, the corresponding amount is scheduled to be reversed.

Deferred gains or losses on hedges

Based on changes in the fair value of the hedging instruments, the corresponding amount is scheduled to bereversed.

* 3. Minimum net assets prescribed in Article 67-4 of the Investment Trust Act(in thousands of yen)
Third Fiscal Period
As of September 30, 2016

Fourth Fiscal Period
As of March 31, 2017
50,00050,000(Notes to Statements of Income and Retained Earnings)* 1. Breakdown of real estate rental revenues and expenses(in thousands of yen)
Third Fiscal Period
From April 1, 2016
to September 30, 2016

Fourth Fiscal Period
From October 1, 2016
to March 31, 2017

A. Rental and other operating revenues:
Rent revenue-real estate:
Rental revenues

4,393,233

4,467,838

Rental revenues from limited proprietary rights of land

680,862

728,620

Common area charges

331,693328,281

5,405,789

5,524,740

Parking space rental revenues

163,358

162,994

Utility charge reimbursement

540,060

455,670

Miscellaneous

264,959

284,075

Subtotal
Other lease business revenue:

Subtotal

968,378

902,740

6,374,168

6,427,481

Property management fees and facility management fees

684,963691,625

Utilities

523,159438,881Taxes

482,449

482,777

Repairs and maintenance

150,915

157,638

Insurance

12,341

12,281

Trust fees

17,294

17,790Depreciation

714,171

721,606

Total rental and other operating revenues
B. Property-related expenses:
Expenses related to rent business:

OthersTotal property-related expenses
C. Net operating income from real estate rental business（A-B）

22

274,888295,3822,860,183

2,817,984

3,513,984

3,609,497

Kenedix Retail REIT Corporation (3453)(Notes to Statements of Changes in Net Assets)* 1. Total number of authorized investment units and total number of investment units issued and outstanding
Third Fiscal Period
From April 1, 2016
to September 30, 2016

Fourth Fiscal Period
From October 1, 2016
to March 31, 2017

Total number of authorized investment units

5,000,000 units

5,000,000 units

Total number of investment units issued and outstanding

422,450 units

422,450 units(Notes to Statements of Cash Flows)* 1. Reconciliation of balance sheet items to cash and cash equivalents at the end of period in the cash flows statements
Third Fiscal Period
From April 1, 2016
to September 30, 2016

(in thousands of yen)
Fourth Fiscal Period
From October 1, 2016
to March 31, 2017

Cash and deposits

4,367,293

5,258,633

Cash and deposits in trust

11,615,129

11,575,715

Restricted bank deposits in trust (Note)(2,753,121)(2,537,444)

Cash and cash equivalents

13,229,301

14,296,903

Note: Restricted bank deposits in trust are retained for repayment of tenant leasehold and security deposits in trust.

(Notes to Lease Transactions)Operating lease transactions (Lessee)
Future minimum lease payments(in thousands of yen)
Third Fiscal Period
As of September 30, 2016

Fourth Fiscal Period
As of March 31, 2017

Due within 1 year

10,50010,500Due after 1 year

204,298

199,048

Total

214,798

209,548

Operating lease transactions (Lessor)
Future minimum lease income(in thousands of yen)
Third Fiscal Period
As of September 30, 2016

Fourth Fiscal Period
As of March 31, 2017

Due within 1 year

5,754,371

6,112,316

Due after 1 year

47,304,424

49,962,185

Total

53,058,796

56,074,501（Notes to the Financial Instruments）
1. Overview(1) Policy for financial instruments
KRR procures funds for asset acquisitions, repairs, payment of distributions, repayment of loans, etc. through loans from financial institutions, issuance of investment corporation
bonds, issuance of investment units and other means. With regard to the procurement of interest-bearing debts, KRR ensures that it can effectively combine stable long-term fundswith flexible short-term funds. Management of surplus funds is undertaken through various bank deposits focusing on safety, liquidity and effectiveness. KRR uses derivatives for the
purpose of hedging its exposure to changes in interest rates and other risks and does not enter into derivative transactions for speculative or trading purposes.
(2) Types of financial instruments and related risk
Bank deposits are for managing KRR’s surplus funds and are exposed to credit risk such as the bankruptcy of financial institutions at which funds are deposited.
Investment securities represent equity investments in a silent partnership and are exposed to credit risk of the issuer, risk of fluctuation of value of its property and interest rate
fluctuation risk.
Borrowings, and investment corporation bonds, which are made primarily for the purpose of procuring funds for the acquisition of real estate and trust beneficiary interests in realestate and have a repayment date of a maximum of 9 years and 10 months as for borrowings and also have a redemption date of a maximum of 9 years and 7 months as forinvestment corporation bonds as of March 31, 2017, the end of the fourth fiscal period, are exposed to liquidity risk where alternative funds may not be procured by the repayment
date. Also, borrowings with floating interest rates are exposed to interest rate fluctuation risk. Derivatives are used for the purpose of hedging interest rate fluctuation risk for a certain
portion of the borrowings.
Tenant leasehold and security deposits are deposits received from tenants, which are exposed to liquidity risks when the tenants vacate the properties.
(3) Risk management for financial instrumentsa.
Credit risk
While bank deposits are exposed to credit risk such as the bankruptcy of financial institutions at which funds are deposited, such risk is monitored by deposits in non-interest bearing
ordinary savings accounts or with financial institutions with credit ratings above a certain level. Investment securities represent equity investments in a silent partnership and are
exposed to credit risk of the issuer. To manage this credit risk, the Investment Corporation regularly evaluates the results of operations and the financial condition of the issuer, etc. In
utilizing derivatives, KRR aims to mitigate counterparty risk such as by transacting with financial institutions with favorable ratings.
b.
Market risk
While borrowings with floating rates are exposed to interest rate fluctuation risk, such risk is monitored by adjusting the rate of the balance of borrowings with floating rates against
the total borrowings according to the financial environment, interest rate forecasts by continuous monitoring, etc. and by using derivatives, etc. While investment securities, which
23

Kenedix Retail REIT Corporation (3453)
are equity investments in a silent partnership, are exposed to credit risk of the issuer and property value fluctuation risk, the Investment Corporation periodically reviews the value ofthe property and financial condition of the issuer with regard to these investment securities. A risk management policy is established with regard to the execution and managementof derivatives and such transactions are conducted based on this policy.
c.
Liquidity risk
Though borrowings are subject to liquidity risk, KRR reduces such risk by spreading out payment due dates and by diversifying financial institutions. Liquidity risk is also managed
by such means as regularly checking the balance of cash reserves.
Though tenant leasehold and security deposits are subject to liquidity risk, in principle, KRR reduces such risk by retaining funds that would enable KRR to return

necessary amounts to tenants.
(4) Supplementary explanation of the estimated fair value of financial instruments
The fair value of financial instruments is based on their quoted market price, if available. When there is no quoted market price available, fair value is reasonably estimated. Sincevarious assumptions and factors are reflected in estimating the fair value, different assumptions and factors could result in a different fair value.
2. Estimated fair value of financial instruments
The carrying value of financial instruments on the balance sheets and estimated fair value are shown in the following table. Items whose fair values are difficult to determine are notincluded in the following table (Note 2).
Third Fiscal Period
As of September 30, 2016

(1) Cash and deposits(2) Cash and deposits in trust
Total(1) Short-term loans payable(2) Current portion of long-term loans payable(3) Investment corporation bonds(4) Long-term loans payable(5) Tenant leasehold and security deposits in trust
Total
Derivative transactions

Carrying amount
4,367,293
11,615,129
15,982,422
12,070,000
57,230,000
3,408,166
72,708,166(31,166)

Estimated fair value
4,367,293
11,615,129
15,982,422
12,070,000
57,710,245
3,443,698
73,223,944(31,166)(in thousands of yen)
Difference
480,245
35,531
515,777-

Carrying amount
5,258,633
11,575,715
16,834,348
11,470,000
3,850,000
2,000,000
57,380,000
3,147,555
77,847,555
23,395

Estimated fair value
5,258,633
11,575,715
16,834,348
11,470,000
3,847,148
1,984,200
57,540,509
3,151,660
77,993,518
23,395(in thousands of yen)
Difference(2,851)(15,800)
160,509
4,105
145,963-

Fourth Fiscal Period
As of March 31, 2017

(1) Cash and deposits(2) Cash and deposits in trust
Total(1) Short-term loans payable(2) Current portion of long-term loans payable(3) Investment corporation bonds(4) Long-term loans payable(5) Tenant leasehold and security deposits in trust
Total
Derivative transactions

Note1: Methods to determine the estimated fair value of financial instruments and matters related to derivative transactions
Assets(1) Cash and deposits and (2) Cash and deposits in trust
Since these items are settled in a short period of time, their carrying amount approximates fair value.
Liabilities(1) Short-term loans payable
Since these items are settled in a short period of time, their carrying amount approximates fair value.
(2) Current portion of long-term loans payable and (4) Long-term loans payable
Among these items, the fair value of loans payable with fixed interest rates is calculated based on the present value, which is the total amount of principal and interest discounted by theestimated interest rate to be applied in the event that KRR conducts new loans of the same type. As for the fair value of loans payable with floating interest rates, it is based on the
carrying amount since market interest rates are reflected in the short term and the fair value is believed to approximate the carrying amount as the credit standing of KRR has notchanged significantly since the loans were made. (However, the fair value of long-term loans payable subject to the special treatment for interest-rate swaps is based on the present
value of the total of principal and interest, accounted for together with the applicable interest-rate swaps, discounted by the estimated interest rate to be applied in the event that KRR
conducts new loans payable of the same type.)(3) Investment corporation bonds
The fair value of investment corporation bonds is based on quoted market prices.
(5) Tenant leasehold and security deposits in trust
The fair value is determined based on the present value of contractual cash flows discounted at the discount rate into which the period to the repayment date and the credit risk arereflected.
Derivative transactions
Please refer to “Notes to Derivative Transactions”.

24Kenedix Retail REIT Corporation (3453)
Note2: Financial instruments whose fair values are extremely difficult to determine(in thousands of yen)
Third Fiscal Period
As of September 30, 2016
2,500

Classification
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust

8,110,419

Total
8,112,919
Because no quoted market price is available and it is extremely difficult to determine their fair value based on estimated future cash flows because the repayment dates of those
deposits are not certain. Therefore, these financial instruments are not included in the above quantitative information.
(in thousands of yen)
Fourth Fiscal Period
As of March 31, 2017
101,690Classification
Investment securities (*1)
Tenant leasehold and security deposits in trust (*2)

8,249,594

Total
8,351,284(*1) Fair values of investment securities are not subject to disclosure of fair value as they have no market price and their fair values are recognized to be extremely difficult to grasp.
(*2) Because no quoted market price is available and it is extremely difficult to determine their fair value based on estimated future cash flows because the repayment dates of those
deposits are not certain. Therefore, tenant leasehold and security deposits in trust are not included in the above quantitative information.
Note 3: Redemption of monetary claims scheduled to be due after the balance sheet date
Third Fiscal Period
As of September 30, 2016
(in thousands of yen)

Cash and deposits
Cash and deposits in trust
Total

Due in 1 year or
less
4,367,293
11,615,129
15,982,422

Due after 1 year
through 2 years

Due in 1 year or
less5,258,633
11,575,715
16,834,348

Due after 1 year
through 2 years

Due after 2 years
through 3 years-

Due after 3 years
through 4 years-

Due after 4 years
through 5 years-

Due after 5 years--

Fourth Fiscal Period
As of March 31, 2017
(in thousands of yen)

Cash and deposits
Cash and deposits in trust
Total

Due after 2 years
through 3 years-

Due after 3 years
through 4 years-

Due after 4 years
through 5 years-

Due after 5 years--

Note 4: Redemption of long-term loans payable and other interest-bearing debt scheduled to be due after the balance sheet date
Third Fiscal Period
As of September 30, 2016
(in thousands of yen)

Short-term loans payable
Long-term loans payable
Tenant leasehold and security
deposits in trust
Total

Due in 1 year or
less12,070,000-

Due after 1 year
through 2 years

Due after 2 years
through 3 years

Due after 3 years
through 4 years

Due after 4 years
through 5 years

Due after 5 years

3,850,000

6,980,000

7,000,000

7,000,000

32,400,000

435,430

435,430

435,430

435,430

435,430

546,223

12,505,430

4,285,430

7,415,430

7,435,430

7,435,430

32,946,223

Due in 1 year or
less
11,470,000
3,850,000

Due after 1 year
through 2 years

Due after 2 years
through 3 years

Due after 3 years
through 4 years

Due after 4 years
through 5 years

Due after 5 years

5,650,000

8,330,000

7,000,000

1,000,000
7,500,000

1,000,000
28,900,000

435,430

435,430

435,430

435,430

435,430

328,508

15,755,430

6,085,430

8,765,430

7,435,430

8,935,430

30,228,508

Fourth Fiscal Period
As of March 31, 2017
(in thousands of yen)

Short-term loans payable
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security
deposits in trust
Total

25

Kenedix Retail REIT Corporation (3453)(Notes to Derivative Transactions)(1) Transactions not subject to hedge accounting
Third Fiscal Period (As of September 30, 2016) and Fourth Fiscal Period (As of March 31, 2017): Not applicable(2) Transactions subject to hedge accounting
Third Fiscal Period
As of September 30, 2016
Hedge
accounting
methodPrinciple method

Special treatment
of interest-rate
swaps

Type of derivativetransactions
Interest rate swap
transaction:
Receive/floating andpay/fixed
Interest rate swap
transaction:
Receive/floating andpay/fixed

Hedged items

Contract amount(in thousands of yen)
Maturing after 1
yearLong-term loans
payable5,340,000

5,340,000

Long-term loans
payable44,900,000

44,900,000

Fair value(in thousands of yen)

(31,166)*

Calculation method for
applicable fair value
Based on the amountprovided by counterparty
financial institutions-

50,240,000
50,240,000(31,166)*Interest rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As a result, their fair value is included in the fair value of thehedged long-term loans payable. (Please refer to “Notes to Financial Instruments (Note1) Methods to determine the estimated fair value of financial instruments and matters related toderivative transactions Liabilities (2) Current portion of long-term loans payable and (4) Long-term loans payable”.)
Fourth Fiscal Period
As of March 31, 2017
Hedge
accounting
methodPrinciple method

Special treatment
of interest-rate
swaps

Type of derivativetransactions
Interest rate swap
transaction:
Receive/floating andpay/fixed
Interest rate swap
transaction:
Receive/floating andpay/fixed

Hedged items

Contract amount(in thousands of yen)
Maturing after 1
yearLong-term loans
payable5,840,000

5,840,000

Long-term loans
payable44,900,000

41,050,000

Fair value(in thousands of yen)

23,395*

Calculation method for
applicable fair value
Based on the amountprovided by counterparty
financial institutions-

50,740,000
46,890,000
23,395*Interest rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As a result, their fair value is included in the fair value of thehedged long-term loans payable. (Please refer to “Notes to Financial Instruments (Note1) Methods to determine the estimated fair value of financial instruments and matters related toderivative transactions Liabilities (2) Current portion of long-term loans payable and (4) Long-term loans payable”.)(Notes to the Related-Party Transactions)
1．Parent Company, major corporate unitholders and other
Third Fiscal Period (From April 1, 2016 to September 30, 2016) and Fourth Fiscal Period (From October 1, 2016 to March 31, 2017): Not applicable
2．Affiliated companies and other
Third Fiscal Period (From April 1, 2016 to September 30, 2016) and Fourth Fiscal Period (From October 1, 2016 to March 31, 2017): Not applicable
3．Fellow subsidiary companies and other
Third Fiscal Period (From April 1, 2016 to September 30, 2016) and Fourth Fiscal Period (From October 1, 2016 to March 31, 2017): Not applicable
4．Directors, major individual unitholders and other
Third Fiscal Period (From April 1, 2016 to September 30, 2016) and Fourth Fiscal Period (From October 1, 2016 to March 31, 2017): Not applicable(Notes to the Tax-Effect Accounting)
1. The significant components of deferred tax assets and liabilities:(in thousands of yen)
Fourth Fiscal Period
As of March 31, 2017

Third Fiscal Period
As of September 30, 2016
Deferred tax assets:
Enterprise tax payable

23

242

Amortization of leasehold right in trust

4,189

5,446

Depreciation
Asset retirement obligations
Deferred gains or losses on hedges

1,508
7,325
9,845

Subtotal deferred tax assets

22,892

1,960
7,371
‐
15,020

Valuation allowance(22,892)(15,020)

Total deferred tax assets

-

-

26

Kenedix Retail REIT Corporation (3453)
2. The significant differences between the statutory tax rate and the effective tax rate:
Third Fiscal Period
As of September 30, 201631.74

(unit: %)Fourth Fiscal Period
As of March 31, 2017
34.81

Deductible cash distributions
Others(31.79)0.09(34.76)0.10

Effective tax rate

0.04

0.15

Statutory tax rate

(Notes to Asset Retirement Obligations)
Asset retirement obligations reported on balance sheets
1. Summary of the asset retirement obligations
KRR has recognized the original state restoration obligations assumed under the fixed-term business-purpose land leasehold agreement as the asset retirement obligations inconnection with Sunny Noma acquired on February 10, 2015.
2. Method of calculating asset retirement obligations
Asset retirement obligations are calculated based on a discount rate of 1.256% after the useful life has been estimated to be 22 years and two months based on the time period from thedate of acquisition to the expiration of the agreement.
3. Changes in the amount of applicable asset retirement obligations consisted of the following(in thousands of yen)
Third Fiscal Period
Fourth Fiscal Period
From April 1, 2016
From October 1, 2016
to September 30, 2016
to March 31, 2017
Balance at the beginning of the period
23,04523,190Accretion adustment
144
145
Balance at the end of the period
23,19023,335(Notes to the Segment Information)(Segment information)
Disclosure is omitted because the real estate leasing business is KRR’s sole business and it has no reportable segment subject to disclose.
(Related information)
Third Fiscal Period (From April 1, 2016 to September 30, 2016)
1. Information about each product and service
Disclosure is omitted because net sales to external customers for a single product/service category account for over 90% of the operating revenue on the statement of income andretained earnings.
2. Information about each geographic area
(1) Net sales
Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenue on the statement of income and retained earnings.
(2) Property, plant and equipment
Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount of property, plant and equipment on the balance
sheets.
3. Information about each major customer
Disclosure is omitted because no net sales to a single external customer accounts for more than 10% of the operating revenue on the statements of income and retained earnings.
Fourth Fiscal Period (From October 1, 2016 to March 31, 2017)
1. Information about each product and service
Disclosure is omitted because net sales to external customers for a single product/service category account for over 90% of the operating revenue on the statement of income andretained earnings.
2. Information about each geographic area
(1) Net sales
Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenue on the statement of income and retained earnings.
(2) Property, plant and equipment
Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount of property, plant and equipment on the balance
sheets.
3. Information about each major customer
Disclosure is omitted because no net sales to a single external customer accounts for more than 10% of the operating revenue on the statements of income and retained earnings.

27

Kenedix Retail REIT Corporation (3453)(Notes to Investment and Rental Properties)
KRR owns retail properties for rental purposes mainly in the four major metropolitan areas and other regional areas of Japan.
The book value and fair value concerning the above real estate for rental purposes are as follows.
(in thousands of yen)
Fourth Fiscal Period
From October 1, 2016
to March 31, 2017

Third Fiscal Period
From April 1, 2016
to September 30, 2016
Book value
Balance at the beginning of the period

134,016,587

Changes during the period

27,426,833

161,443,421
5,338,600

Balance at the end of the period

161,443,421

166,782,022

Fair value at the end of the period
168,164,000
175,276,000
Note 1: Book value is acquisition cost less accumulated depreciation.
Note 2: Among changes in the amount of real estate for rental purposes that occurred during the third fiscal period, the principal increase was acquisitions of real estate trust
beneficiary interests in 7 properties totaling 27,834,390 thousand yen and the principal decrease was depreciation amounting to 714,026 thousand yen and during thefourth fiscal period, the principal increase was the acquisitions of real estate trust beneficiary interests in 2 properties totaling 5,711,745 thousand yen and additional
acquisition of real estate trust beneficiary interest amounting to 94,633 thousand yen and the principal decrease was depreciation amounting to 721,460 thousand yen.
Note 3: The fair value at the end of the period is the appraisal value determined by outside appraisers.
The profit or loss for the period under review concerning investment and rental properties is indicated under “Notes to Statements of Income and Retained Earnings.”(Notes to Per Unit Information)
Third Fiscal Period
From April 1, 2016
to September 30, 2016
Net asset value per unit

Fourth Fiscal Period
From October 1, 2016
to March 31, 2017

228,996 yen

229,195 yen

Net income per unit
6,069 yen
6,043 yenNote1: Net income per unit is calculated by dividing net income by the day-weighted average number of investment units outstanding during the period. Net income per unit after
adjusting for residual units is not included because there were no residual investment units.
Note2: The basis for calculating net income per unit is as follows:
Third Fiscal Period
Fourth Fiscal Period
From April 1, 2016
From October 1, 2016
to September 30, 2016
to March 31, 2017
Net income (in thousands of yen)

2,518,595

Net income not attributable to ordinary unitholders (in thousands of yen)

2,552,926--

Net income attributable to ordinary unitholders (in thousands of yen)

2,518,595

2,552,926

Weighted average number of units during the period (units)

414,983

422,450(Notes to Significant Subsequent Events)
Issuance of new investment units
KRR passed resolutions at the Board of Directors Meeting held on March 31, 2017 and April 11, 2017, to issue new investment units to fund the acquisition of specified assets. Payments
for the issuance of new investment units through public offering and through third-party allotment have been completed on April 18, 2017 and May 17, 2017, respectively. KRR used thenet proceeds through third-party allotment for the repayment of loans payable.
As a result, unitholders' capital totaled ¥113,399,022,050 and total number of investment units issued and outstanding increased to 507,700 as of May 17, 2017.
Issuance of new investment units through public offerings
Total number of units issued
Issue price (offer price)
Total amount of issue price (total offer price)
Paid-in amount (issue amount)
Total paid-in amount (total issue amount)
Payment date81,250 units (Domestic 44,592 units, International 36,658 units)
232,537 yen per unit
18,893,631,250 yen
224,547 yen per unit
18,244,443,750 yen
April 18, 2017

Issuance of new investment units through third-party allotment
Total number of units issued
4,000 units
Paid-in amount (issue amount)
224,547 yen per unit
Total paid-in amount (total issue amount)
898,188,000 yen
Payment date
May 17, 2017
Allottee
SMBC Nikko Securities Inc.

(Omission of Disclosure)Notes to Securities, Equity-Method Income and Retained Earnings, and Retirement Payment are omitted as immaterial to disclose.

28

Kenedix Retail REIT Corporation (3453)(9) Changes in Investment Units Issued and Outstanding
Changes in the number of investment units issued and outstanding and unitholders’ capital since its corporation are summarized in the following table.
Total number of units issued andUnitholders’ capital
outstanding (units)(in million yen)
DateType of issue
Notes
Increase
Balance
Increase
Balance
October 3, 2014

Private placement forincorporation

February 9, 2015

750

750

150

150

(Note 1)

Public offering

254,250

255,000

56,43056,580(Note 2)

March 11, 2015

Capital increase throughthird-party allocation

5,750

260,750

1,276

57,857(Note 3)October 1, 2015

Public offering

88,750349,500

18,54776,404(Note 4)

October 21, 2015

Capital increase throughthird-party allocation

5,750

355,250

1,201

77,606(Note 5)

April 20, 2016

Public offering

64,000419,250

15,856

93,463(Note 6)

May 18, 2016

Capital increase throughthird-party allocation

3,200

422,450

792

94,256(Note 7)Note 1:
Note 2:
Note 3:Note 4:Note 5:Note 6:Note 7:Note 8:Issued at issue price of 200,000 yen per unit for incorporation.
Issued at issue price of 230,000 yen per unit (issue amount of 221,950 yen per unit) for acquisition of new properties.
Issued at issue amount of 221,950 yen per unit for repayment of borrowings.
Issued at issue price of 216,543 yen per unit (issue amount of 208,991 yen per unit) for acquisition of new properties.
Issued at issue amount of 208,991 yen per unit for repayment of borrowings.
Issued at issue price of 256,717 yen per unit (issue amount of 247,764 yen per unit) for acquisition of new properties.
Issued at issue amount of 247,764 yen per unit for repayment of borrowings.
Distributions in excess of earnings for the allowance for temporary difference adjustments are not considered.

29

Kenedix Retail REIT Corporation (3453)
4. Resignation/Appointment of the Directors(1) Resignation/Appointment of the Director of KRR
Not applicable(2) Resignation/Appointment of the Director of KFMAt the ordinary general shareholders’ meeting of KFM held on March 29, 2017, Akira Tanaka resigned as director and Keisuke Sato and Motoshi Ichiki wereappointed as new directors as of March 29, 2017. Furthermore, Masayuki Kobayashi was appointed as a new auditor as of March 29, 2017. In addition,
Ryosuke Homma was appointed as Chairman, Representative Director and Masahiko Tajima was appointed as CEO and President at its Board of Directors
held after the ordinary general shareholders’ meeting of KFM.
Appointed: Chairman, Representative Director, Ryosuke Homma (as of March 29, 2017)CEO and President, Masahiko Tajima (as of March 29, 2017)
Director, Keisuke Sato (as of March 29, 2017)
Director, Motoshi Ichiki (as of March 29, 2017)
Auditor (Part-time), Masayuki Kobayashi (as of March 29, 2017)Retired:Director, Akira Tanaka (as of March 29, 2017)30

Kenedix Retail REIT Corporation (3453)
5. Reference Information(1) Component of Assets
Type ofspecified asset

Areas(Note 1)

Property typeTokyo
metropolitan area
Greater Osaka
area
Greater Nagoya
area

Third fiscal period
as of September 30, 2016
Total amount held
Ratio
(Millions of Yen)(%)
(Note 2)
(Note 3)

Fourth fiscal period
as of March 31, 2017
Ratio
Total amount held
(Millions of Yen)(%)
(Note 2)
(Note 3)

71,15939.7

71,122

38.4

45,11725.2

45,00024.3

12,636

7.0

13,971

7.6

Fukuoka area

1,499

0.8

1,485

0.8

Ordinancedesignated cities,
core cities andother areas

30,99517.3

35,200

19.0

-

-

-

-

-

Total of trust beneficiary interests in real estate

161,408

90.0

166,782

90.1

Investment securities (Note 4)

-

-

101

0.1

Bank deposits and other assets

17,951

10.0

18,153

9.8

Total assets

179,360

100.0

185,037

100.0

Trust beneficiaryinterest in real estate

Neighborhood,community andother shopping
centers for daily
needs

Other retailproperties

Third fiscal period
as of September 30, 2016
Ratio
Amount(%)(Millions of Yen)
(Note 3)

Fourth fiscal period
as of March 31, 2017
Ratio
Amount(%)(Millions of Yen)
(Note 3)

Total liabilities (Note 5)

82,62046.1

88,213

47.7

Total net assets (Note 5)

96,73953.996,823

52.3

179,360

100.0

185,037

100.0

Total assets
Note 1:

Note 2:
Note 3:Note 4:Note 5:“Areas” are categorized to the Tokyo metropolitan area, the Greater Osaka area, the Greater Nagoya area, the Fukuoka area and Ordinance-designated cities, core cities
and other areas. References to “Tokyo metropolitan area” are to the area that consists of Tokyo, Kanagawa, Saitama and Chiba prefectures. References to the “Greater
Osaka area” are to the area that consists of Osaka, Kyoto, Hyogo, Nara and Shiga prefectures. References to the “Greater Nagoya area” are to the area that consists of
Aichi, Gifu and Mie prefectures. References to the “Fukuoka area” are to the area that consists of Fukuoka prefecture. “Ordinance-designated cities, core cities and otherareas” refers to cities designated by government ordinance, which have populations of 500,000 persons or more, core cities, which have populations of 200,000 persons
or more, and to other areas with a population fewer than 200,000 persons, which we believe will have suitable customer traffic from surrounding areas.
“Total amount held” is the amount allocated in the balance sheets as of the end of fiscal period (figures are on a net book value basis after deducting depreciation), and isrounded down to the nearest million.
“Ratio” is the ratio of the amount allocated in the balance sheets to the total assets rounded to the nearest tenth.
“Investment securities” is the silent partnership equity interest of JRP8 GK.
“Total liabilities” and “Total net assets” are those on the balance sheets.

31Kenedix Retail REIT Corporation (3453)(2) Overview of the Portfolioi) Overview of Investment Securities
The following summarizes the investment securities owned by KRR as of March 31, 2017.
Book value(in millions)
Unit
Price
price

Evaluation value(in millions) (Note 1)
Unit
Price
price

Ratio (%)
(Note 2)

Evaluation
profits/losses(in millions)

Asset nameRegionType of asset

Amount(units)Silent partnership equity
interest of JRP8 GK(Note 3)

Domestic

Silentpartnership
equity interest

-

-

101

-

101

0.1

-

-

-

101

-

101

0.1

-

Total
Note 1:
Note 2:
Note 3:“Evaluation value” indicates the book value.
“Ratio” is the ratio of the amount allocated in the balance sheets to the total assets rounded to the nearest tenth.
Asset under management is the trust beneficiary interest in real estate of “Yumemachi Narashinodai Mall”.

ii) Overview of Assets Owned
The following summarizes the real estate or the real estate properties in trust owned by KRR as of March 31, 2017.
Location(City or Ward,
Prefecture)(Note 2)

Book value(in millions)

Evaluation value(in millions)(Note 3)Acquisition
price(in millions)(Note 4)

Trust beneficiaryinterest in real estate

14,94815,20014,8489.0

Urayasu, Chiba

Trust beneficiaryinterest in real estate

8,421

8,470

8,063

4.9

Passaggio Nishiarai

Adachi ward, Tokyo

Trust beneficiaryinterest in real estate

5,883

6,360

5,850

3.6

Daikanyama Address
Dixsept

Shibuya ward, Tokyo

Trust beneficiaryinterest in real estate

5,427

5,790

5,390

3.3

4,432

4,750

4,470

2.7

3,982

4,300

4,000

2.4

3,622

3,840

3,600

2.2

2,561

2,750

2,586

1.6

4,890

5,380

4,815

2.9

3,210

3,480

3,169

1.9

3,043

3,050

3,000

1.8

1,726

1,770

1,700

1.0

1,462

1,430

1,442

0.9

770

807

760

0.5

3,472

3,820

3,360

2.0

1,795

1,910

1,724

1.0

1,470

1,520

1,450

0.9

8,416

9,230

8,389

5.1

2,727

2,980

2,685

1.6

2,147

2,430

2,140

1.3

11,48911,60011,000

6.7

Property
number

Property
type(Note 1)

Property name

T-1

CSC

Fululu Garden Yachiyo

Yachiyo, Chiba

MONA Shin-Urayasu

T-2

T-3

T-4

Urban
Station-Front
SC
Urban
Station-Front
SC
Urban
Station-Front
SC

T-5

NSC

Unicus Ina

Kitaadachi-gun,
Saitama

T-6

NSC

Yorktown
Kita-Kaname

Hiratsuka, Kanagawa

T-7

NSC

Unicus Yoshikawa

Yoshikawa, Saitama

T-8

SS

T-9

NSC

T-10

Saitama, Saitama

SS

Sports Club Renaissance
Fujimidai
Super Viva Home
Iwatsuki (Land)
K’s Denki
Shonan-Fujisawa (Land)

T-11

NSC

Unicus Kamisato (Land)

Kodama-gun, Saitama

T-12

NSC

Unicus Konosu (Land)

Konosu, Saitama

T-13

SM

Inageya Yokohama
Minamihonjuku (Land)

Yokohama, Kanagawa

T-14

SM

Gourmet City Chiba-Chuo

Chiba, Chiba

T-15

NSC

Nakamachidai Tokyu Store Yokohama, Kanagawa

T-16

SS

Central Wellness Club
Nagatsuta Minamidai

Yokohama, Kanagawa

T-17

SM

Life Kameido

Koto ward, Tokyo

O-1

NSC

Blumer Maitamon

Kobe, Hyogo

O-2

SM

O-3

NSC

O-4
O-5
O-6

NSC
Urban
Station-Front
SC
Urban
Station-Front
SC

O-7

SM

O-8

SS

Central Square
Takadono (Land)
Piago Kahma Home
Center Omihachiman

Nerima ward, Tokyo

Fujisawa, Kanagawa

Osaka, Osaka
Omihachiman, Shiga

Ownership
form

Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate

Share
(%)
(Note 5)

Blumer HAT Kobe

Kobe, Hyogo

Carino Esaka

Suita, Osaka

Trust beneficiaryinterest in real estate

6,622

6,770

6,555

4.0

COMBOX Komyoike

Izumi, Osaka

Trust beneficiaryinterest in real estate

6,436

6,950

6,450

3.9

Hankyu Oasis
Hirakatadeguchi
Welcia Kishiwadakamori(Land)

Hirakata, Osaka

1,322

1,330

1,280

0.8

497

488

487

0.3

Kishiwada, Osaka

Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate32

Kenedix Retail REIT Corporation (3453)
Location(City or Ward,
Prefecture)(Note 2)

Book value(in millions)

Evaluation value(in millions)(Note 3)Acquisition
price(in millions)(Note 4)

1,568

1,660

1,505

0.9

3,772

3,820

3,723

2.3

2,351

2,590

2,311

1.4

2,155

2,310

2,174

1.3

907

980

889

0.5

7,165

7,310

7,140

4.3

1,390

1,420

1,370

0.8

1,485

1,530

1,497

0.9

10,031

11,00010,046

6.1

1,480

1,550

1,469

0.9

898

928

898

0.5

4,379

5,060

4,180

2.5

3,329

3,330

3,252

2.0

854

873

830

0.5

Trust beneficiaryinterest in real estate

5,718

5,960

5,720

3.5

Hamamatsu, Shizuoka

Trust beneficiaryinterest in real estate

4,187

4,340

4,010

2.4

Moriya, Ibaraki

Trust beneficiaryinterest in real estate

4,320

4,210

4,111

2.5

166,782

175,276

164,338

100.0

Property
number

Property
type(Note 1)

O-9

SM

O-10

NSC

N-1

SS

N-2

NSC

N-3

SS

N-4

SS

N-5

SS

F-1

SM

Sunny Noma

Fukuoka, Fukuoka

R-1

NSC

Roseo Mito

Mito, Ibaraki

R-2

SS

K’s Denki Aomori Honten

Aomori, Aomori

R-3

SS

Super Sports Xebio
Aomori-Chuo

Aomori, Aomori

R-4

NSC

Ashico Town Ashikaga

Ashikaga, Tochigi

R-5

NSC

Sendai, Miyagi

R-6

SM

Yorktown
Shinden-Higashi
Kasumi Technopark
SakuraR-7

Urban
Station-Front
SC

Solala Plaza

Sendai, Miyagi

R-8

NSC

P-1 Plaza Tenno

R-9

NSC

Seiyu Rakuichi Moriya(Land)

Property name
Life
Nishi-Tengachaya
Million Town Tsukaguchi(Land)
Kahma Home Center
Nakagawa Tomita (Land)
Valor
Ichinomiya-Nishi
K’s Denki
Nakagawa Tomita (Land)
Homecenter Kohnan
Sunadabashi
K’s Denki
Shin-Moriyama (Land)

Osaka, Osaka
Amagasaki, Hyogo
Nagoya, Aichi
Ichinomiya, Aichi
Nagoya, Aichi
Nagoya, Aichi
Nagoya, Aichi

Tsukuba, Ibaraki

Ownership
form
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate
Trust beneficiaryinterest in real estate

Total
Note 1:

Note 2:
Note 3:Note 4:Note 5:

Share(%)(Note 5)

Properties are categorized into the following five types of retail properties for daily needs: NSC (Neighborhood Shopping Center), SM (Supermarket), CSC (Community
Shopping Center), Urban Station-Front SC (Urban Station-Front Shopping Center) and SS (Specialty Store). For the details of each type of retail properties, please refer“Section 2. Investment Policies and Status of Asset Management, (2) Status of Asset Management (Overview of the Period), iii) Management Performance, (A)Acquisition of Assets”.
“Location” indicates the residential address. For those without a residential address, the building or land address on the registry is shown.
“Evaluation value” shows the appraisal value stated on the real estate appraisal report created by the real estate appraisers of Daiwa Real Estate Appraisal Co., Ltd., Japan
Real Estate Institute and The Tanizawa Sōgō Appraisal Co., Ltd. in accordance with the methods and standards for asset valuation as stipulated in the KRR Articles ofIncorporation as well as the regulations as stipulated by The Investment Trusts Association, Japan.
“Acquisition price” indicates the transfer price of the property to be acquired designated in each sale and purchase agreement (excluding the acquisition expenses, property
taxes, city planning taxes and consumption taxes, and rounded down to the nearest million yen). (As for the properties with building expansion, the price includes theamount described in the construction contract and construction design/supervision outsourcing contracts (excluding expenses and taxes and rounded down to the nearest
million yen)).
“Share” represents the percentage of the acquisition price for each property in the total acquisition price, rounded to the nearest tenth.

33

Kenedix Retail REIT Corporation (3453)
iii) Overview of tenants as of March 31, 2016
The following summarizes leasable area, leased area, occupancy rate, number of tenants, annual rent, and amount of security deposits
Property
number

Property nameLeasable area(m2)
(Note 1)

Leased area(m2)
(Note 2)

Occupancy
rate(%)(Note 3)

Number oftenants(Note 4)

Annual rent
(thousands)(Note 5)

Amount of
security
deposits(millions)(Note 6)

T-1

Fululu Garden Yachiyo

77,057.56

75,694.45

98.2

48

1,076,129

3,351

T-2

MONA Shin-Urayasu

9,592.65

9,180.34

95.7

1(70)

590,902655

T-3

Passaggio Nishiarai

10,546.25

10,342.77

98.1

1(41)

398,812

233

T-4

Daikanyama Address Dixsept

5,056.39

4,905.88

97.0

1(26)

353,668

333

T-5

Unicus Ina

13,462.71

13,462.71

100.0

1

279,002

141

T-6

Yorktown Kita-Kaname

100.0

1

T-7

Unicus Yoshikawa

10,648.27

10,648.27

100.0

1(11)

T-8

Sports Club Renaissance Fujimidai

3,120.87

3,120.87

100.0

1

T-9

Super Viva Home Iwatsuki (Land)

67,325.95

67,325.95

100.0

1

T-10

K’s Denki Shonan-Fujisawa (Land)

15,578.58

15,578.58

100.0

1

T-11

Unicus Kamisato (Land)

67,854.47

67,854.47

100.0

1

145,220

70

T-12

Unicus Konosu (Land)

19,329.00

19,329.00

100.0

1

83,014

39

T-13

Inageya Yokohama Minamihonjuku (Land)

4,405.41

4,405.41

100.0

1

T-14

Gourmet City Chiba-Chuo

3,488.77

3,488.77

100.0

1

T-15

Nakamachidai Tokyu Store

5,968.71

5,968.71

100.0

1

T-16

Central Wellness Club Nagatsuta Minamidai

3,996.70

3,996.70

100.0

2

T-17

Life Kameido

2,929.58

2,929.58

100.0

1

O-1

Blumer Maitamon

30,037.11

29,790.80

99.2

50

O-2

Central Square Takadono (Land)

4,437.07

4,437.07

100.0

1(Note 7)(Note 7)

O-3

Piago Kahma Home Center
Omihachiman

14,313.00

14,313.00

100.0

2

(Note 7)(Note 7)O-4

Blumer HAT Kobe

24,185.02

23,968.51

99.1

1(41)

648,448856

O-5

Carino Esaka

7,540.58

7,371.52

97.8

1(30)

287,036

239

O-6

COMBOX Komyoike

25,530.44(Note 8)25,530.44

100.0

1

452,523(Note 9)O-7

Hankyu Oasis Hirakatadeguchi

2,960.38

2,960.38

100.0

1

O-8

Welcia Kishiwadakamori (Land)3,033.45

3,033.45

100.0

1

447
(Note 10)(Note 7)(Note 7)O-9Life Nishi-Tengachaya

2,679.52

2,679.52

100.0

1

O-10

Million Town Tsukaguchi (Land)8,264.46

8,264.46

100.0

1(Note 7)(Note 7)

N-1

Kahma Home Center Nakagawa Tomita (Land)

100.0

1

(Note 7)(Note 7)

N-2

Valor Ichinomiya-Nishi

100.0

1

(Note 7)(Note 7)N-3

K’s Denki Nakagawa Tomita (Land)

100.0

1

(Note 7)(Note 7)

N-4

Homecenter Kohnan Sunadabashi

100.0

1

(Note 7)(Note 7)

N-5

K’s Denki Shin-Moriyama (Land)

100.0

1

(Note 7)(Note 7)

F-1

Sunny Noma

100.0

1

(Note 7)(Note 7)(Note 7)(Note 7)(Note 7)(Note 7)

9,447.48(Note 7)

9,447.48(Note 7)

20,329.07(Note 7)

20,329.07(Note 7)2,814.67

2,814.67

34(Note 7)(Note 7)261,267(Note 7)(Note 7)(Note 7)(Note 7)(Note 7)(Note 7)203
(Note 7)(Note 7)141

(Note 7)(Note 7)(Note 7)

116,400(Note 7)146
(Note 7)686,284(Note 7)(Note 7)416

89,740262

Kenedix Retail REIT Corporation (3453)

Property
number

Property nameLeasable area(m2)
(Note 1)

Leased area(m2)
(Note 2)

Occupancy
rate(%)(Note 3)

Number oftenants(Note 4)

Annual rent
(thousands)(Note 5)

R-1

Roseo Mito

48,296.15

48,161.79

99.7

1(22)

R-2

K’s Denki Aomori Honten

10,083.41

10,083.41

100.0

1

(Note 7)

R-3

Super Sports Xebio Aomori-Chuo

100.0

1

(Note 7)

R-4

Ashico Town Ashikaga

65,616.31

65,616.31

100.0

1(29)

R-5

Yorktown Shinden-Higashi

12,768.77

12,768.77

100.0

2

R-6

Kasumi Technopark Sakura

2,047.65

2,047.65

100.0

1

R-7

Solala Plaza

100.0

1

R-8

P-1 Plaza Tenno

100.0

7

R-9

Seiyu Rakuichi Moriya (Land)

100.0

1

99.6

409

(Note 7)Note 2:
Note 3:Note 4:Note 5:Note 6:Note 7:Note 8:Note 9:Note 10:(Note 7)(Note 7)

12,030.83

Total
Note 1:(Note 7)(Note 7)

12,030.83(Note 7)

719,906.77

717,011.12

Amount of
security
deposits(millions)(Note 6)690,130

459
174(Note 7)395,668(Note 7)(Note 7)(Note 7)334
(Note 7)24
(Note 7)

270,720(Note 7)
10,683,903

282(Note 7)
11,397“Leasable area” is equivalent to gross floor area of space that we consider to be available for lease in each property, rounded to the nearest tenth. For land-only properties,
leasable area is equivalent to land area as described in the property registry.
“Leased area” indicates the total leased area based on the lease agreements for each property as of March 31, 2017. As for lease agreements of buildings, the leased area of
warehouses and land are excluded. As for pass-through type master leases, the leased area based on the lease agreements between the master lessee and the end-tenants asof March 31, 2017 is shown. As for sublease type master leases, the leased area to the master lessee is shown.
“Occupancy rate” is calculated by dividing leased area by leasable area as of March 31, 2017, rounded to the nearest tenth. The “Total” of “Occupancy rate” represents theaverage occupancy rate of all properties in the initial portfolio.
“Number of tenants” is based upon the number of lease agreements with respect to the building(s) (or land in the case of land-only properties with leasehold interest) on
each such property used mainly as stores and offices, as of March 31, 2017. Where one lessee leases more than one section of the property, the lessee is counted as a tenant
for each section leased within the property. Where pass-through type master lease agreements are entered into, the number of master lessees is with the number of endtenants indicated in parentheses. Where sublease type master lease agreements are entered into, the indicated, number of master lessee is shown. The “Total” of “Numberof tenants” shows the total number of tenants. As for pass-through type master leases, the number of end-tenants is used for calculation. As for sublease type master leases,
the number of master lessee is used for calculation.
“Annualized fixed rent” is generally calculated by multiplying the monthly fixed rent and common area charges under a leasing contract with tenants at portfolio properties
as of March 31, 2017 (excluding warehouses in the case of building lease agreements) by twelve and rounding down to the nearest thousand yen. For master leases, where
the master lease company subleases space to other tenants, the fixed monthly rent under the master lease contract is multiplied by twelve, rounded down to the nearest
thousand yen.
“Tenant leasehold and security deposits” indicates the outstanding balance of any tenant leasehold and security deposit from the relevant end-tenant(s) set forth in leaseagreement(s) effective as of March 31, 2017 (excluding warehouses in the case of building lease agreements), rounded down to the nearest million yen.
We have not obtained consent from the tenant(s) to release this information.
The total area that we own exclusively as a compartmentalized ownership interest (retail space) is shown.
Calculated by multiplying the monthly rent and common area charges for March 2017 under the leasing contract by twelve and also taking into consideration theownership ratio (93.20%) under the compartmentalized ownership agreement.
Calculated by multiplying the tenant leasehold and security deposits for the whole building as of March 2017 by the ownership ratio (93.20%).

35

Kenedix Retail REIT Corporation (3453)
iv) Overview of the appraisal reports
The following show the summaries of the appraisal reports is the appraisal value of the acquired properties described in each real estate appraisal report
prepared by real estate appraisers, including Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute, and The Tanizawa Sōgō Appraisal Co., Ltd.
as requested by KRR, based on an important notice concerning real estate appraisal in the context of the Act on Investment Trusts and Investment
Corporations, Act on Real Estate Appraisal (Act No. 152 of 1963, including subsequent revisions) and real estate appraisal standards. The appraisal value
is the judgment and opinion of the appraiser at a fixed point in time, with no guarantees as to the validity or accuracy of the report, nor to the possibility oftransactions at the appraised value. There are no special relations of interest between Daiwa Real Estate Appraisal Co., Ltd., Japan Real Estate Institute,and The Tanizawa Sōgō Appraisal Co., Ltd. and KRR or KFM.
Estimated value
Cash flow-based method
Property
number

Property nameAppraiser

Daiwa Real EstateAppraisal Co.,
Ltd.
Japan Real Estate
Institute
Daiwa Real EstateAppraisal Co.,
Ltd.
Japan Real Estate
InstituteJapan Real Estate
Institute
Daiwa Real EstateAppraisal Co.,Ltd.
Daiwa Real EstateAppraisal Co.,Ltd.
Daiwa Real EstateAppraisal Co.,
Ltd.

T-1

Fululu Garden Yachiyo

T-2

MONA Shin-Urayasu

T-3

Passaggio Nishiarai

T-4

Daikanyama Address
Dixsept

T-5

Unicus Ina

T-6

Yorktown Kita-Kaname

T-7

Unicus Yoshikawa

T-8

Sports Club
Renaissance Fujimidai

T-9

Super Viva Home
Iwatsuki (Land)

The Tanizawa
Sōgō Appraisal
Co., Ltd.

K’s Denki ShonanFujisawa (Land)

The Tanizawa
Sōgō Appraisal
Co., Ltd.

T-10

Appraisal
Evaluation
Direct capitalization method
value
Cost methoddate(in millions)(in millions) EstimatedCapitalization Estimated value
value
rate (%)(in millions)(in millions)Appraisal
NOI yield
Appraisal(%)
NOI(Note 2)
Terminal(in millions)capitalization(Note 1)rate (%)

DCF method
Discount rate(%)

Mar. 31,2017

15,20021,00015,200

4.6

15,200

4.4

4.8

750

5.1

Mar. 31,
2017

8,470

6,850

8,500

5.2

8,430

4.8

5.3

491

6.1

Mar. 31,
2017

6,360

8,920

6,500

4.3

6,300

4.1

4.5

287

4.9

5,790

4,930

5,890

3.7

5,690

3.5

3.9

223

4.1

4,750

4,070

4,780

5.1

4,710

4.8

5.3

250

5.6

Mar. 31,
2017

4,300

2,560

4,390

4.9

4,260

4.7

5.1

215

5.4

Mar. 31,
2017

3,840

4,740

3,900

4.7

3,810

4.5

4.9

185

5.2

Mar. 31,
2017

2,750

1,750

2,790

4.6

2,730

4.4

4.8

128

5.0

Mar. 31,
2017

5,380

-

-

-

5,380

-

207

4.3

-

159

5.0

-

138

4.6

-

77

4.6

Mar. 31,2017
Mar. 31,2017(year 1-16)
4.6(year 17-35.7)
4.7(year 1-11)
Mar. 31,
2017

3,480

-

-

-

3,480

4.4
(year12-30.6)
4.5(year 1-14)

T-11

Unicus Kamisato (Land)

The Tanizawa
Sōgō Appraisal
Co., Ltd.

4.6
Mar. 31,
2017

3,050

-

-

-

3,050

(year 15-29)
4.7(year 30-38.5)
4.8(year 1-14)

T-12

Unicus Konosu (Land)

The Tanizawa
Sōgō Appraisal
Co., Ltd.

4.5
Mar. 31,
2017

1,770

-

-

-

1,770

(year 15-29)
4.6(year 30-38.5)
4.7

T-13

Inageya Yokohama
Minamihonjuku (Land)

T-14

Gourmet City ChibaChuo

T-15

T-16

Nakamachidai Tokyu
Store
Central Wellness Club
Nagatsuta Minamidai

T-17

Life Kameido

O-1

Blumer Maitamon

Japan Real Estate
Institute
Daiwa Real EstateAppraisal Co.,Ltd.
Daiwa Real EstateAppraisal Co.,Ltd.
Daiwa Real EstateAppraisal Co.,Ltd.
Daiwa Real EstateAppraisal Co.,Ltd.
The Tanizawa
Sōgō Appraisal
Co., Ltd.

Mar. 31,
2017

1,430

-

-

-

1,430

4.0

4.7

64

4.5

Mar. 31,
2017

807

1,030

800

5.1

810

4.9

5.3

43

5.8

Mar. 31,
2017

3,820

2,870

3,870

4.6

3,800

4.4

4.8

182

5.4

Mar. 31,
2017

1,910

2,380

1,920

5.0

1,900

4.8

5.2

97

5.7

Mar. 31,
2017

1,520

1,960

1,540

4.2

1,510

3.9

4.4

65

4.5

Mar. 31,
2017

9,230

9,040

9,220

5.3

9,240

5.4

5.5

497

5.9

-

128

4.8

6.4

151

7.1

(year 1-8)
O-2

Central Square
Takadono (Land)

4.2

The Tanizawa
Sōgō Appraisal
Co., Ltd.

Mar. 31,2017

Japan Real Estate
InstituteMar. 31,
2017

2,980

-

-

-

2,980

(year 9-18)
4.3(year 19-38.3)
4.4

O-3

Piago Kahma Home
Center Omihachiman

2,430

2,340

2,450

36

6.2

2,410

5.9

Kenedix Retail REIT Corporation (3453)
Estimated value
Cash flow-based method
Property
number

Property nameAppraiser

Daiwa Real EstateAppraisal Co.,
Ltd.
Japan Real Estate
Carino Esaka
Institute
Daiwa Real Estate
COMBOX Komyoike
Appraisal Co.,Ltd.
Daiwa Real Estate
Hankyu Oasis
Appraisal Co.,
Hirakatadeguchi
Ltd.
Welcia Kishiwadakamori Japan Real Estate(Land)
Institute
The Tanizawa
LifeSōgō Appraisal
Nishi-Tengachaya
Co., Ltd.

Appraisal
Evaluation
Direct capitalization method
value
Cost methoddate(in millions)(in millions) EstimatedCapitalization Estimated value
value
rate (%)(in millions)(in millions)Appraisal
NOI yield
Appraisal(%)
NOI(Note 2)
Terminal(in millions)capitalization(Note 1)rate (%)

DCF method
Discount rate(%)

Mar. 31,2017

11,60014,40011,7004.8

11,600

4.6

5.0

566

5.1

Mar. 31,
2017

6,770

6,540

6,800

4.7

6,740

4.4

4.9

343

5.2

Mar. 31,
2017

6,950

7,770

7,180

5.1

6,850

4.8

5.3

389

6.0

Mar. 31,
2017

1,330

888

1,340

5.5

1,320

5.3

5.7

75

5.9

Mar. 31,
2017

488

-

-

-

488

4.0

4.7

21

4.5

Mar. 31,
2017

1,660

1,610

1,680

4.7

1,650

4.8

4.9

79

5.3

The Tanizawa
Sōgō Appraisal
Co., Ltd.

Mar. 31,
2017

3,820

-

-

-

3,820

-

159

4.3

N-1

The Tanizawa
Kahma Home Center
Sōgō Appraisal
Nakagawa Tomita (Land)
Co., Ltd.

Mar. 31,
2017

2,590

-

-

-

2,590

-

120

5.2

N-2

Valor Ichinomiya-Nishi

Japan Real Estate
InstituteMar. 31,
2017

2,310

1,860

2,320

5.1

2,300

5.3

128

5.9

N-3

K’s Denki Nakagawa
Tomita (Land)

The Tanizawa
Sōgō Appraisal
Co., Ltd.

Mar. 31,
2017

980

-

-

-

980

-

46

5.2

O-4
O-5
O-6

O-7
O-8
O-9

O-10

Blumer HAT Kobe

Million Town
Tsukaguchi (Land)

Homecenter Kohnan
Sunadabashi

N-5

K’s Denki
Shin-Moriyama (Land)

F-1

Sunny NomaJapan Real Estate
Institute

R-1

Roseo Mito

R-3

K’s Denki Aomori
HontenSuper Sports Xebio
Aomori-Chuo

R-4

Ashico Town Ashikaga

R-5

Yorktown ShindenHigashi

R-6

Kasumi Technopark
SakuraR-7

Solala Plaza

R-8

P-1 Plaza Tenno

R-9

Seiyu Rakuichi Moriya(Land)

Note 2:
Note 3:(year 1-16)
4.5(year 17-36.2)
4.6
4.8(year 1-16)
4.5(year 17-36.2)
4.6
7,310

7,540

7,450

4.8

7,250

4.6

5.0

368

5.2

1,420

-

-

-

1,420

4.0

4.3

60

4.4

Mar. 31,
2017

1,530

1,300

1,560

5.0

1,490

4.8

5.4

80

5.4

Japan Real Estate
InstituteMar. 31,2017

11,0009,420

11,1005.3

10,900

5.0

5.5

596

5.9

Japan Real Estate
InstituteMar. 31,
2017

1,550

1,670

1,550

5.6

1,540

5.3

5.8

92

6.3

Japan Real Estate
InstituteMar. 31,
2017

928

854

933

5.6

923

5.3

5.8

57

6.4

5,070

5.1
(Building)
5.0(Land)

5.5(Building)

268

6.4

Daiwa Real EstateMar. 31,
Appraisal Co.,
2017
Ltd.
Daiwa Real EstateMar. 31,
Appraisal Co.,
2017
Ltd.
Daiwa Real EstateMar. 31,
Appraisal Co.,
2017
Ltd.
Japan Real Estate Mar. 31,
Institute
2017
Japan Real Estate Mar. 31,
Institute
2017
Daiwa Real EstateMar. 31,
Appraisal Co.,
2017
Ltd.

Total/Average

Note 1:

4.2(year 20-38.9)
4.4

Daiwa Real EstateMar. 31,
Appraisal Co.,
2017
Ltd.
Japan Real Estate Mar. 31,
Institute
2017

N-4

R-2

(year 1-19)

5,060

8,090

5,030

5.3
(Building)
5.0(Land)(Note 3)

3,330

5,090

3,340

5.5

3,330

5.3

5.7

193

6.0

873

754

881

5.1

870

4.9

5.3

46

5.6

5,960

4,120

5,990

4.8

5,920

4.5

5.0

286

5.0

4,340

4,350

4,370

5.1

4,300

4.8

5.3

230

5.7

4,210

-

4,250

4.3

4,190

4.2

4.4

166

4.1

175,276

150,696

149,224-

174,431

-

-

8,727

5.3

“Appraisal NOI” is the Net Operating Income calculated by subtracting the amount of operating expenses from the operating revenues described in relevant appraisal
reports, and it is the income before depreciation and differs from NCF (Net Cash Flow) which is calculated by adding investment gains from such as deposits andsubtracting capex from NOI. The above appraisal NOI is calculated using the direct capitalization method. However, where the direct capitalization method is notapplicable, appraisal NOI indicates the net operating income for the first year based on the DCF method. (Note that Unicus Kamisato (Land) and Unicus Konosu (Land)
use NOI for the third year, when ordinary operations are expected to take place.) The amounts are rounded down to the nearest one million yen.
“Appraisal NOI yield” indicates the value calculated using the following formula and rounded to the nearest tenth. The “Total/average” of “Appraisal NOI yield” indicatesthe average appraisal NOI yield which is a weighted average of appraisal NOI yields of the acquired properties (rounded to the nearest tenth).
Appraisal NOI of each property / Acquisition price for each property.
Inwood method discount rate is shown for discount rate of land-only properties.

37

Kenedix Retail REIT Corporation (3453)
v) Overview of building condition investigation reports
KRR has obtained engineering reports, containing the diagnosis of building deteriorations, short- and long-term repair and maintenance plans, theassessment of legal compliance with the Building Standard Act and other laws and regulations, the investigation of hazardous substances in a building andsoil environment for the acquired properties and the to-be acquired properties. These reports represent judgement and opinion of the appraisers for a fixed
point of time, with no guarantees as to the validity or accuracy of the report.
Property
Number

Property name

Investigation company

Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.

T-1

Fululu Garden Yachiyo

T-2

MONA Shin-Urayasu

T-3

Passaggio Nishiarai

T-4

Daikanyama Address Dixsept

T-5

Unicus Ina

T-6

Yorktown Kita-Kaname

T-7

Unicus Yoshikawa

T-8

Sports Club Renaissance Fujimidai

T-9

Super Viva Home Iwatsuki (Land)(Note 2)

T-10

K’s Denki Shonan-Fujisawa (Land)

T-11

Investigation
performed in

Repairs, maintenance and renovation
expensesRequired over theRequired over the
next 12 years
next 12 years(thousand yen)(thousand yen)
(Note 1)
(Note 1)

Nov. 2014

980,970-

Nov. 2014

921,734

16,696

Nov. 2014

125,949-

Nov. 2014

145,352-

Aug. 2014
Dec. 2016(Restaurant
building)

130,310

1,110

Nov. 2014

13,213

1,775

Nov. 2014

59,132-

Sep. 2014

23,780

400

-

-

-

(Note 2)---

Unicus Kamisato (Land)(Note 2)

-

-

-

T-12

Unicus Konosu (Land)(Note 2)

-

-

-

T-13

Inageya Yokohama Minamihonjuku (Land)(Note 2)---

Aug. 2015

24,669131

Mar. 2016

28,394-Mar. 2016

16,888-Mar. 2016

21,442-

Nov. 2014

211,954---

Aug. 2014

56,850180Mar. 2015

326,565

3,959

Aug. 2015

424,506

6,443

Aug. 2015

355,643-

Aug. 2015

57,175---

15,464

2,225

T-14

Gourmet City Chiba-Chuo

T-15

Nakamachidai Tokyu Store

T-16

Central Wellness Club Nagatsuta Minamidai

T-17

Life Kameido

O-1

Blumer Maitamon

O-2

Central Square Takadono (Land)

HI International Consultant
Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
HI International Consultant
Co., Ltd.

Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
(Note 2)
HI International Consultant
Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.

-

O-3

Piago Kahma Home Center Omihachiman

O-4

Blumer HAT Kobe

O-5

Carino Esaka

O-6

COMBOX Komyoike

O-7

Hankyu Oasis Hirakatadeguchi

O-8

Welcia Kishiwadakamori (Land)

O-9

Life Nishi-Tengachaya

O-10

Million Town Tsukaguchi (Land)(Note 2)

-

-

-

N-1

Kahma Home Center Nakagawa Tomita(Land)(Note 2)

-

-

-

N-2

Valor Ichinomiya-Nishi

177,790

2,690

N-3

K’s Denki Nakagawa Tomita (Land)

-

-

N-4

Homecenter Kohnan Sunadabashi

336,943-

N-5

K’s Denki Shin-Moriyama (Land)

-

-

F-1

Sunny Noma

41,960420(Note 2)
Tokio Marine & Nichido
Risk Consulting Co., Ltd.

HI International Consultant
Co., Ltd.
(Note 2)
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
(Note 2)
HI International Consultant
Co., Ltd.

38

Sep. 2015

Aug. 2014
Dec. 2015
Aug. 2014

Kenedix Retail REIT Corporation (3453)

Property
Number

Property name

R-1

Roseo Mito

R-2

K’s Denki Aomori Honten

R-3

Super Sports Xebio Aomori-Chuo

R-4

Ashico Town Ashikaga

R-5

Yorktown Shinden-Higashi

R-6

Kasumi Technopark Sakura

R-7

Solala Plaza

R-8

P-1 Plaza Tenno

R-9

Seiyu Rakuichi Moriya (Land)

Investigation company

HI International Consultant
Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
Tokio Marine & Nichido
Risk Consulting Co., Ltd.
(Note 3)
Total

Note 1:
Note 2:
Note 3:

Investigation
performed in

Repairs, maintenance and renovation
expensesRequired over theRequired over the
next 12 years
next 12 years(thousand yen)(thousand yen)
(Note 1)
(Note 1)

Aug. 2014(Secondhand Shopbuilding:
Oct. 2015)

238,790

550

Nov. 2014

142,764-

Nov. 2014

103,012-

Aug. 2015

327,264-

Jul. 2015

176,945

4,163

Aug. 2015

18,155-Mar. 2016

25,430-Mar. 2016

159,757

28,423--

5,688,800

69,165-Of the “Repairs, maintenance and renovation expenses,” “Required over the next 12 years” indicates the total expenses required during the next 12 years from the date of
the investigation report and “Required within one year” indicates the total expenses required within 1 year from the date of the investigation report. All figures aretruncated to thousands of yen as in the investigation reports.
Since these are land-only properties, KRR did not obtain the engineering report but obtained history survey report on the land use from Field Partners.
Since this is a land-only property, KRR did not obtain the engineering report but obtained history survey report on the land use from Tokio Marine & Nichido Risk
Consulting Co., Ltd.

39

Kenedix Retail REIT Corporation (3453)
vi) Overview of seismic PML evaluation report
The following summary is based on the Portfolio Earthquake PML Evaluation Report created by the Sompo Risk Management & Health Care Inc. as ofMarch 2016. However, KRR does not guarantee the accuracy of evaluations in the report. The report only represents judgement and opinion of theappraiser for a fixed point of time, with no guarantees as to the validity or accuracy of the report. There is no special interest between the Sompo Risk
Management & Health Care Inc. and KRR or KFM.
Property
PML value in seismic review (%)
Property namenumber(Note 1)
Specialty store building 10.24
T-1
Fululu Garden Yachiyo
Ito-Yokado building 8.96
Retail building 5.98
T-2
MONA Shin-Urayasu
Parking building 5.97
T-3
Passaggio Nishiarai
3.13
T-4

Daikanyama Address Dixsept

11.11

T-5

Unicus Ina

4.51

T-6

Yorktown Kita-Kaname

8.72

T-7

Unicus Yoshikawa

3.26

T-8

Sports Club Renaissance Fujimidai

7.09

T-9

Super Viva Home Iwatsuki (Land)

-

T-10

K’s Denki Shonan-Fujisawa (Land)

-

T-11

Unicus Kamisato (Land)

-

T-12

Unicus Konosu (Land)

-

T-13

Inageya Yokohama Minamihonjuku (Land)

T-14

Gourmet City Chiba-Chuo

1.82

T-15

Nakamachidai Tokyu Store

8.15

T-16

Central Wellness Club Nagatsuta Minamidai

T-17

Life Kameido

3.79

O-1

Blumer Maitamon

1.52

O-2

Central Square Takadono (Land)
Piago Kahma Home Center
Omihachiman

O-3-

Retail building 7.70
Parking building 6.36

Piago building 3.95
Kahma Home Center building 5.22
4.69

O-4

Blumer HAT Kobe

O-5

Carino Esaka

3.17

O-6

COMBOX Komyoike

5.04

O-7

Hankyu Oasis Hirakatadeguchi

4.11

O-8

-

O-10

Welcia Kishiwadakamori (Land)
Life
Nishi-Tengachaya
Million Town Tsukaguchi (Land)

N-1

Kahma Home Center Nakagawa Tomita (Land)

N-2

Valor Ichinomiya-Nishi

N-3

K’s Denki Nakagawa Tomita (Land)-

N-4

Homecenter Kohnan Sunadabashi

7.47

N-5

K’s Denki Shin-Moriyama (Land)

F-1

Sunny Noma

O-9

R-1

Roseo Mito

R-2

K’s Denki Aomori Honten

R-3

Super Sports Xebio Aomori-Chuo

R-4

Ashico Town Ashikaga

R-5

Yorktown Shinden-Higashi

6.32
10.18

Coffee shop building
Mall building
Sports facility building
Hardware store building
Secondhand shop building
K’s Denki building
TSUTAYA/ Hard-off building
Shopping mall building
Extensions
Cinema building
Road-side building

40

1.95
7.41
6.70
9.69
9.68
7.85
1.61
1.51
1.52
2.16
1.91
2.28
2.59
3.43

Kenedix Retail REIT Corporation (3453)
R-6

Kasumi Technopark Sakura

R-7

Solala Plaza

R-8

P-1 Plaza Tenno

R-9

Seiyu Rakuichi Moriya (Land)

4.46
A building 21.66(Note 2)
B building 11.84
C building 12.29
D building 11.12
E building 13.36
F building 16.98
G building 9.07
H building 12.00-

Portfolio PML value (Note 3)

2.24

Note 1:
Note 2:
Note 3:

6.40

PML is rounded to the nearest hundredth.
The building is on earthquake insurance as its PML value is higher than 20%.
“Portfolio PML value” is the portfolio PML value of 30 properties that excludes Super Viva Home Iwatsuki (Land), K’s Denki Shonan-Fujisawa (Land),Unicus Kamisato (Land), Unicus Konosu (Land), Inageya Yokohama Minamihonjuku (Land), Central Square Takadono (Land), Welcia
Kishiwadakamori (Land), Million Town Tsukaguchi (Land), Kahma Home Center Nakagawa Tomita (Land), K’s Denki Nakagawa Tomita (Land),K’s Denki Shin-Moriyama (Land) and Seiyu Rakuichi Moriya (Land), which is based on the Portfolio Earthquake PML Evaluation Report created by
Sompo Risk Management & Health Care Inc. as of March 2016.

41

Kenedix Retail REIT Corporation (3453)
vii) Architect, structural engineer, construction company and construction confirmation authority
Property
number

Property nameConstruction company

Construction confirmation
authority

Architect

Structural engineer(Ito Yokado Yachiyo)
Research Institute ofArchitechture,Tokyo Branch(Fululu Garden Yachiyo)
Research Institute ofArchitechture,Tokyo Branch(Ito Yokado Yachiyo)
Takenaka Corporation,
Higashi-Kanto Branch(Fululu Garden Yachiyo)
Takenaka Corporation,
Higashi-Kanto Branch

The Building Center ofJapan

Chiba Prefecture

T-1

Fululu Garden
Yachiyo(Ito Yokado Yachiyo)
Research Institute ofArchitechture, Tokyo Branch(Fululu Garden Yachiyo)
Research Institute ofArchitechture,Tokyo Branch

T-2

MONA ShinUrayasu

Haseko Corporation,
Engineering Division

Haseko Corporation,
Engineering Division

Haseko Corporation

T-3

Passaggio Nishiarai

Yamashita Sekkei Inc.

Yamashita Sekkei Inc.

Nishimatsu Construction Co., Tokyo Prefecture
Ltd.

T-4

Daikanyama Address
Nihon Sekkei, Inc.
Dixsept

Nihon Sekkei, Inc.

Kajima Corporation

Tokyo Prefecture

T-5

Unicus Ina

Taisei Corporation,
Registered architect office

Taisei Corporation,
Registered architect office

Taisei Corporation

Bureau Veritas Japan Co.,
Ltd.

T-6

Yorktown KitaKaname

CB Richard Ellis Asset
Services K.K.

Sankyoline Corporation

Asanuma Corporation

K.K. Building
Navigation

T-7

Unicus Yoshikawa

Obayashi Corporation

Obayashi Corporation

Obayashi Corporation

Saitama Housing
Inspection Center

T-8

Sports Club
Renaissance Fujimidai

K.K. Axs Engineering

K.K. Axs Engineering

Ichiken Co., Ltd.

Nerima ward

T-9

Super Viva Home
Iwatsuki (Land)

-

-

-

-

T-10

K’s Denki ShonanFujisawa (Land)

-

-

-

-

T-11

Unicus Kamisato(Land)

-

-

-

-

T-12

Unicus Konosu(Land)

-

-

-

-

T-13

Inageya Yokohama
Minamihonjuku(Land)

-

-

-

-

T-14

Gourmet City
Chiba-Chuo

T-15

Nikken Sekkei Ltd.

Consortium of Taisei
Corporation and Shimizu
Corporation

Nakamachidai Tokyu Kyouritsu Associates
Store
Architects & Engineers

Espace Architect Office

The Japan Building
Tokyu Construction Co., Ltd. Equipment and Elevator
Yokohama BranchCenter Foundation

T-16(Retail building)Daiwa House Industry Co.,
Central Wellness Club Ltd.
Nagatsuta Minamidai (Parking building)Daiwa House Industry Co.,Ltd.

(Retail building)
Konishi Sekkei Co., Ltd.,(Parking building)
Vega Sekkei Co., Ltd.

(Retail building)Daiwa House Industry Co.,
Ltd.,
(Parking building)Daiwa House Industry Co.,
Ltd.

T-17

Life Kameido

Sumitomo Construction Co., Sumitomo Construction Co., Sumitomo Construction Co.,
Ltd.
Ltd.
Ltd.

Koto ward

O-1

Blumer Maitamon

Asanuma Corporation

Bureau Veritas Japan Co.,
Ltd.

O-2

Central Square
Takadono (Land)

O-3

Piago Kahma
Home Center
Omihachiman(Piago building）(Piago building）(Piago building）
K.K. Organization of
Kiuchi Construction Co., Ltd.
Kiuchi Construction Co., Ltd.
Kiuchi Construction Co., Ltd.
Confirmation &(Kahma Home Center building) (Kahma Home Center building) (Kahma Home Center building) Inspection Annex
Daiken Tosikaihatu Co., Ltd.
Daiken Tosikaihatu Co., Ltd.
Aisawa Construction Co., Ltd. (Note2)O-4Blumer HAT Kobe

Obayashi Corporation

Nikken Sekkei Ltd.

-

Asanuma Corporation-

Obayashi Corporation

42

Daiwa System Co., Ltd.
-

Obayashi Corporation

The Building Center of Japan

Japan ERI Co., Ltd.

-

Center of International
Architectural Standard Co.,Ltd.

Kenedix Retail REIT Corporation (3453)
Property
number

Property name

Architect

Structural engineer

Construction company

Construction confirmation
authority

O-5

Carino Esaka

Tokyu Architects & Engineers
Inc. (for new building
Tokyu Architects &construction)
Engineers Inc.
Tokyu Construction Co., Ltd.
(for property expansion)

O-6

COMBOX
Komyoike

Daiwa House Industry Co.,Ltd.

Daiwa House Industry Co.,Ltd.

Daiwa House Industry Co.,
Ltd.

General Building Research
Corporation of Japan

O-7

Hankyu Oasis
Hirakatadeguchi

Rui Sekkeishitsu Co., Ltd.

Rui Sekkeishitsu Co., Ltd.

Obara Construction Co.,
Ltd.

General Building Research
Corporation of Japan

O-8

WelciaKishiwadakamori(Land)

-

-

-

-

O-9

Life
Nishi-Tengachaya

KIA Urban Planning andArchitects Institute Co., Ltd.

Nihon Kensetsu Co., Ltd.

Center of International
Architectural Standard Co.,
Ltd.

O-10

Million Town
Tsukaguchi (Land)

-

-

-

-

N-1

Kahma Home Center
Nakagawa Tomita(Land)

-

-

-

-

N-2

Valor IchinomiyaNishi

N-3
N-4
N-5
F-1

R-1

Chubu Sekkei Co., Ltd.

Fujita Corporation

Chubu Sekkei Co., Ltd.

Tokyu Construction Co., Ltd. Suita City

Tsuchiya Corporation

K’s Denki
Nakagawa Tomita(Land)
Homecenter
KohnanSunadabashi
K’s Denki
Shin-Moriyama(Land)--

Nankai Sogo Sekkei Co.,Ltd.

Nankai Sogo Sekkei Co.,
Ltd.

-

-

Sunny Noma

Nakamuta & Suenaga
Designing (JV)

Roseo Mito

(Coffee shop building)(Coffee shop building)
Tetsu Works Architect OfficeTetsu Works Architect Office(Mall building)(Mall building)
Kurehanishiki Construction Co., Ltd. Sezako Structural
Change of use:
Engineering Office
Registered Architect(Sports facility building)Studio Work House
Individual (Note 3)(Sports facility building)(Hardware store building)
Kishi-Sekkei Co., Ltd.
K.K. Dan Structural(Hardware store building)Engineering OfficeNihon Jutaku Corporation,(Secondhand shop building)
Registered Architect Office
Converse Corporation(Secondhand shop building)Choeihands Corporation(Coffee shop building)
Kurehanishiki Construction
Co., Ltd.
(Mall building)
Kurehanishiki
Construction Co., Ltd.
(Sports facility building)
Kurehanishiki
Construction Co., Ltd.
(Hardware store building)
Nihon Jutaku Corporation(Secondhand shop building)Choeihands Corporation

Nakamuta & Suenaga
Designing (JV)

Ichinomiya City

Obayashi Corporation

Japan ERI Co., Ltd.

Nishimatsu Construction
Co., Ltd., Kyushu Branch

Fukuoka City

(Coffee shop building)(Mall building)(Sports facility building)(Hardware store building)
Mito City(Secondhand shop building)Japan ERI Co., Ltd.

R-2

K’s Denki
Aomori Honten

K.K. Kyoei Planning
DesignK.K. Kyoei Planning
Design(K’s Denki building)
Nihon Kensetsu Co.,
Ltd., Sendai Branch
Aomori City
(TSUTAYA/Hard-off building)
Nihon Kensetsu Co.,
Ltd., Sendai Branch

R-3

Super Sports Xebio
Aomori-Chuo

Takenaka Corporation

Individual (Note 3)

Takenaka Corporation

Japan ERI Co., Ltd.

R-4

Ashico Town
Ashikaga

Penta-Ocean Construction
Co., Ltd. (shopping mallbuilding, cinema building,road-side building)
KKHY Architects &Associates (extensions)Penta-Ocean Construction
Co., Ltd. (shopping mallbuilding, cinema building,road-side building)Architecture Form
Corporation (extensions)Penta-Ocean Construction
Co., Ltd. (shopping mallbuilding, cinema building,road-side building)Tokyo Biso Kogyo
Corporation (extensions)Bureau Veritas Japan Co.,
Ltd.

R-5

Yorktown
Shinden-Higashi

MTM International
Corporation

MTM International
Corporation

Kajima Corporation

Japan ERI Co., Ltd.

R-6

Kasumi Technopark
SakuraOffice Okano
Kenchikusekkei Co., Ltd.

Office Okano
Kenchikusekkei Co., Ltd.

Nakano Corporation Co., Ltd. Ibaraki Prefecture43Kenedix Retail REIT Corporation (3453)
Property
number

Property name

Architect

Solala Plaza

Yamashita Sekkei Inc.

R-8

R-9

R-7

Note 1:

Structural engineer

Construction company

Construction confirmation
authority

Yamashita Sekkei Inc.

Shimizu Corporation

Japan ERI Co., Ltd.

P-1 Plaza Tenno(A building)First-Class Architect Office
Atelier Zero (for newbuilding construction ),Entetsu General
Constructor (for building
expansion)(B building)Parking Pro Co., Ltd.
(C building)Daiwa House Industry Co.,Ltd.
(D building)Daiwa House Industry Co.,Ltd.
(E building)Daiwa House Industry Co.,Ltd.
(F building)
DO Design Co., Ltd.
(G building)
Akou Co., Ltd.
(H building)
Akou Co., Ltd.

(A building)First-Class Architect
Office Atelier Zero(B building)Parking Pro Co., Ltd.
(C building)Daiwa House Industry
Co., Ltd.
(D building)Daiwa House Industry
Co., Ltd.
(E building)(F building)Toda Corporation(G building)
Akou Co., Ltd. First-Class
Architect Office(H building)
Akou Co., Ltd. First-Class
Architect Office(A building)Toei Interior Co., Ltd.,
Iidagumi Co., Ltd. (for newbuilding construction)
Entestsu General
Constructor (for building
expansion)(B building)Parking Pro Co., Ltd.
(C building)Daiwa House Industry Co.,Ltd.
(D building)Daiwa House Industry Co.,Ltd.
(E building)Daiwa House Industry Co.,Ltd.
(F building)Toda Corporation(G building)
Akou Co., Ltd.
(H building)
Akou Co., Ltd.

(A building)Hamamatsu City
(B building)
Kakunin Service Inc.
(C building)
Shizuokaken Kenchiku
Jyuutaku Machizukuri
Center(D building)
Shizuokaken Kenchiku
Jyuutaku Machizukuri
Center(E building)
Shizuokaken Kenchiku
Jyuutaku Machizukuri
Center(F building)
Shizuokaken Kenchiku
Jyuutaku Machizukuri
Center(G building) HamamatsuCity(H building) Hamamatsu
City

Seiyu Rakuichi
Moriya (Land)

-

-

-

-

Note 2:

The above company names are names at the time of construction confirmation, completion, or acquiring inspection certificate for respective properties, even in cases ofpast changes in names.
The name of actual construction company is shown, although it was Daiwa System Co., Ltd. at the time of application procedure for building confirmation.

Note 3:

Individuals’ names are not disclosed because these are personal information.

44

Kenedix Retail REIT Corporation (3453)
viii) Overview of portfolio(A) Distribution by property type
Property type
Neighborhood, community and other shopping centers for daily

Acquisition price(in millions)

Percentage of total portfolio
acquisition price (%) (Note)42

164,338

100.0

NSC (Neighborhood Shopping Centers)

17

77,97047.4

SM (Supermarkets)

8

11,4497.0

CSC Community shopping Centers）

1

14,8489.0

Urban Station-Front Shopping Centers

6

38,02823.1

SS (Specialty Store)

10

22,043

13.4

-

-

-

42

164,338

100.0

needs

Other retail properties
Total
Note:

Number ofproperties

Percentage of total portfolio acquisition price is rounded to the nearest tenth. Therefore, the sum of the percentage of total acquisition price may differ from the portfolio total.

(B) Distribution by location
RegionFour major metropolitan areas

Acquisition price(in millions)

Percentage of total portfolio
acquisition price (%) (Note)

33

129,82279.0

Tokyo metropolitan area

17

70,227

42.7

Greater Osaka area

10

44,214

26.9

Greater Nagoya area

5

13,884

8.4

Fukuoka area

1

1,497

0.9

9

35,51621.0

42164,338

100.0

Ordinance-designated cities, core cities and other areas
Total
Note:

Number ofproperties

Percentage of total portfolio acquisition price is rounded to the nearest tenth. Therefore, the sum of the percentage of total acquisition price may differ from the portfolio total.

(C) Distribution by property age
Property age(Note 1)

Number ofproperties

Acquisition price(in millions)

Percentage of total portfolio
acquisition price (%) (Note 2)Less than 5 years

-

-

-

5 years or more but less than 10 years

11

43,331

32.2

10 years or more

19

91,30567.8

30

134,636

100.0

Total
Note 1:
Note 2:

Property age refers to the number of years from the date of the new construction of the property set out in the real estate registry to March 31, 2017. Where multiple buildings
exist on the property, the property age is calculated using the average age of those buildings.
Percentage of total portfolio acquisition price is rounded to the nearest tenth. Therefore, the sum of the percentage of total portfolio acquisition price may differ from theportfolio total.

45

Kenedix Retail REIT Corporation (3453)(D) Distribution by Lease Term Remaining
Lease term (remaining period)(Note 1)

Annual fixed rent (in millions)(Note 2)

Ratio (%)
(Note 3)

Less than 2 years

1,997

18.7

2 to less than 5 years

1,314

12.3

5 to less than 10 years

2,768

25.9

10 to less than 15 years

2,682

25.1

15 to less than 20 years

1,192

11.2

20 years or more

728

6.8

10,683

100.0

Total

“Lease term (remaining period)” is based on period until the last date of the lease as set forth in the relevant lease agreements as of March 31, 2017 (excluding warehouses forbuilding lease agreements) for each acquired property and to-be acquired property.
“Annual fixed rent” for acquired property is calculated by multiplying the monthly fixed rent and common area charges for the month ended March 31, 2017 (excluding
warehouses in the case of building lease agreements) by twelve and rounding down to the nearest million yen. For master leases, where the master lease company subleases
space to other tenants, the fixed monthly rent under the master lease contract is multiplied by 12, rounded down to the nearest million yen.
“Ratio” is based on the annual fixed rent, rounded to the nearest tenth. As a result, simple aggregation of “ratio” figures may not be the same as the total period.

Note 1:
Note 2:
Note 3:(E) Distribution by lease contract typeType of lease contract

Ratio (%) (Note)

Fixed-term building lease

65.4

Regular building lease

19.2

Commercial fixed-term land lease

15.4

Others

0.0
Total

Note:

100.0

“Ratio” is based on the annual fixed rent as indicated in Note 2 of (D) above, rounded to the nearest tenth. As a result, simple aggregation of “ratio” figures may not be thesame as the total figure.

(F) Rent type (Fixed / Sales-linked rent)
Rent type (Note 1)(Fixed / Sales-linked rent)

Ratio (%) (Note 2)

Fixed rent

82.6

Fixed rent with sales-linked rent

12.4

Sales-linked rent

5.0
100.0

Total
Note 1:
Note 2:“Fixed rent” refers to rent that remains unchanged regardless of actual tenant sales revenues as set forth in the relevant lease agreements. “Fixed rent with sales-linked rent”
refers to rent that consist of a portion that remains unchanged regardless of actual tenant sales revenues and a portion that is based on tenant sales as set forth in the relevant
lease agreements. “Sales-linked rent” refers to rent that is based on actual tenant sales revenues as set forth in the relevant lease agreements.
“Ratio” is calculated according to the actual rent effective between October 1, 2016 and March 31, 2017, rounded to the nearest tenth. As a result, simple aggregation of“ratio” figures may not be the same as the total figure.

46

Kenedix Retail REIT Corporation (3453)
ix) Capital expenditures(A) Planned capital expenditures
The table below shows major capital expenditures (Note) for renovations, repairs and other projects that are planned for the fifth fiscal period ending
September 30, 2017. These expenditures are for real estate owned by KRR and real estate in trusts in which KRR owns trust beneficiary rights.
These planned projects may include some expenditures that will be recorded as expenses rather than capital expenditures for accounting purposes.
Planned amount of capital
expenditure
Property(Millions of yen)
Property nameLocation
PurposeSchedule
number
Total
Payment for the
Totalamountperiodalready paid
From March 2017
MONA
T-2
Urayasu, Chiba First phase of renewal
134
Shin-Urayasu
to July 2017
Blumer HAT
From March 2017
O-4
Kobe, Hyogo
Changing of layout
85
Kobe
to June 2017
Yorktown
From April 2017
Hiratsuka,
T-6
Roof waterproof
63
Kanagawa
Kita-Kaname
to September 2017
From April 2017
BlumerO-1
Kobe, Hyogo
LED installation to common area
46
Maitamonto September 2017
From April 2017
O-5
Carino Esaka
Suita, Osaka
Escalator renewal
24
to September 2017
(B) Capital expenditures during the period under review
The table below shows major capital expenditures for renovations, repairs and other projects in the period under review.
The amount of capital expenditures in the period under review was 276 million yen. There were also expenditures of 157 million yen that wererecorded as repair expenses. In total we spent 433 million yen on the projects.
Property
Capital expenditure
Property nameLocation
PurposeSchedule
number(Millions of yen)
From February 2017
O-5
Carino Esaka
Suita, Osaka
Elevator and escalator renewal
59
to March 2017
MONA
From July 2016
T-2
Urayasu, Chiba PMAC replacement
48
Shin-Urayasu
to December 2016
Ashico Town
Ashikaga,
From January 2017
R-4
LED installation to common area
31
Ashikaga
Tochigi
to March 2017
From December 2016
MONA
Installation of safety devices to fire
T-2
Urayasu, Chiba
18
Shin-Urayasu
shutters
to March 2017
PMAC cooling water pump
From January 2017
MONA
T-2
Urayasu, Chiba
14
Shin-Urayasu
replacement
to March 2017

Note:

Others

102

Total

276

The construction of a new restaurant building in Unicus Ina is not including in the above list because it involves an acquisition of a new building.

(C) Reserved Amount for Long-Term Repairs, Maintenance and Renovation Plans
Not applicable47

Kenedix Retail REIT Corporation (3453)
x) Major portfolio properties
The table below shows the major property owned by KRR as of March 31, 2017. Major properties are defined as those that account for 10% or more of
the total rental revenue generated from all assets held by KRR.
Annual rent
Property
Number of
Leased area
Leasable area
Property name(Millions of yen)numbertenants(m2)(m2)(Note)T-1
Note:

Fululu Garden Yachiyo

48

1,076

75,694.45

77,057.56

Annual rent is 12 times the fixed monthly rent (including a common service charge) under a leasing contract with tenants at portfolio properties as of March 31, 2017(excluding building leasing contracts for warehouses), rounded down to the nearest million yen. For master leases, where the master lease company subleases space toother tenants, the fixed monthly rent under the master lease contract is multiplied by 12, rounded down to the nearest million yen.

48

Kenedix Retail REIT Corporation (3453)(3) Information Concerning Major Tenantsi) Top End-Tenants in Terms of Rent
The following summarizes top ten tenants (end-tenants or sublease type master leasee) as of March 31, 2017

Name of end tenants

Ito-Yokado Co., Ltd.
(Note 5)

P&D Consulting Co., Ltd.

YorkMart Co., Ltd.

Type ofbusiness(Note 1)

Property nameTotal
leasedarea(m2)

RetailFululu Garden Yachiyo(Note 5)

Real estate

A Unicus Ina
B Unicus Kamisato (Land)
C Unicus Konosu (Land)
D Ashico Town Ashikaga

104,810.72

RetailYorktown Kita-Kaname(Note 5)

Life Corporation

RetailLixil Viva Corporation

RetailEdion Corporation

RetailDaiwaroyal Co., Ltd.

Toyota Tsusho Corporation

A Unicus Yoshikawa,
B Life Kameido
C Central Square Takadono(Land)
D Life Nishi-Tengachaya
A Super Viva Home Iwatsuki(Land)B Roseo Mito

12,501.97

Ratio
(%)
(Note 2)

Annualfixed rent
(in thousandsof yen)(Note 3)Tenantleaseholdand security
deposits(in millions of yen)
(Note 4)(Note 5)(Note 5)(Note 5)

14.6

(Note 5)1.7

507,238251(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)

Blumer Maitamon(Note 5)(Note 5)(Note 5)(Note 5)

Real estate

COMBOX Komyoike

25,530.44

3.5

Wholesale

Homecenter Kohnan Sunadabashi

20,329.07

2.8

Seiyu GK

RetailA Sunny NomaB Seiyu Rakuichi Moriya (Land)(Note 5)

Otsuka Kagu, Ltd.

RetailSolala Plaza(Note 5)Note 1:
Note 2:
Note 3:Note 4:Note 5:452,523

447(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)(Note 5)

“Type of business” is based on Japan Standard Industrial Classification.
“Ratio” is the ratio of leased area of the end-tenant to total leasable area of the portfolio as of March 31, 2017, rounded to the nearest tenth.
“Annual fixed-rent” for each property is based on monthly contracted rent (including common area charges) as set forth in the relevant lease agreements effective as ofMarch 31, 2017 (excluding warehouses for building lease agreements) for each property or property in trust, truncated to thousands of yen. In a sublease type master lease,
the annual rent (excluding consumption taxes) agreed upon in the master lease agreement or the amount obtained by multiplying the monthly rent (excluding consumption
taxes) agreed upon in the master lease agreement by 12, rounded down to the nearest thousand yen, is shown.
Indicates the outstanding balance of any tenant leasehold and security deposit from the relevant end-tenant(s) set forth in lease agreement(s) effective as of March 31, 2017,
rounded down to the nearest million yen.
We have not obtained consent from the tenant to release this information.

49

Kenedix Retail REIT Corporation (3453)
ii) Top End-Tenants in Terms of Leased Area
The end-tenants or the sublease type master lessees that cover over 10% of the total leased area of portfolio as of March 31, 2017 are as follows.
Totalleased area(m2)

Name of end
tenants

Type ofbusiness

P&D
Consulting
Co., Ltd.

Real estate

A Unicus Ina
B Unicus Kamisato (Land)
C Unicus Konosu (Land)
D Ashico Town Ashikaga

104,810.72

Lixil Viva
Corporation

RetailA Super Viva Home Iwatsuki(Land)B Roseo Mito

(Note)

Note:

Property name

Annualfixed rent
(in thousandsof yen)50

Lease term
endLease renewal

251

A Sep. 25, 2036
B Oct. 1, 2055
C Oct. 1, 2055
D Mar. 31, 2026

A Not Applicable
B Not Applicable
C Not Applicable
D Not Applicable(Note)(Note)

507,238(Note)We have not obtained consent from the tenant to release this information.

Tenantleaseholdand security
deposits(in millions of yen)

(Note)

Kenedix Retail REIT Corporation (3453)
平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年10月2日 平成27年10月2日 平成27年10月2日 平成27年10月2日【Reference】

Earnings Performance for the Individual Properties for the 4th Fiscal Period (October 1, 2016 to March 31, 2017)：182 days ※As of March 31, 2017
Tokyo metropolitan area

Location
Property No.

T-1

T-2

T-3

T-4

T-5

T-6

T-7

T-8

T-9

T-10

T-11

T-12

K’s DenkiSports Club
Daikanyama
Unicus Kamisato Unicus Konosu
Super Viva Home
Yorktown
UnicusFululu Garden
MONA
Passaggio
ShonanRenaissance
Address
Unicus Ina(Land)(Land)
Iwatsuki (Land)
Kita-Kaname
Yoshikawa
YachiyoShin-Urayasu
Nishiarai
Fujisawa (Land)
Fujimidai
Dixsept
February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015 October 2, 2015 October 2, 2015 October 2, 2015 October 2, 2015

Property Name
Acquisition Date
Price
Information

Acquisition price ( In millions of yen )14,848

8,063

5,850

5,390

4,470

4,000

3,600

2,586

4,815

3,169

3,000

Percentage of total portfolio

9.0%

4.9%

3.6%

3.3%

2.7%

2.4%

2.2%

1.6%

2.9%

1.9%

1.8%

1.0%

Net book value ( In millions of yen )14,948

8,421

5,883

5,427

4,432

3,982

3,622

2,561

4,890

3,210

3,043

1,726

Appraisal value at the end of period ( In millions of yen )15,200

8,470

6,360

5,790

4,750

4,300

3,840

2,750

5,380

3,480

3,050

1,770

8.7%

4.8%

3.6%

3.3%

2.7%

2.5%

2.2%

1.6%

3.1%

2.0%

1.7%

1.0%

48

1（70）

1（41）

1（26）

1

1

1（11）

1

1

1

1

1

Leasable floor area (㎡)

77,057.56

9,592.65

10,546.25

5,056.39

13,462.71

10,648.27

3,120.87

67,325.95

15,578.58

67,854.47

19,329.00

Leased floor area (㎡)75,694.45

9,180.34

10,342.77

4,905.88

13,462.71

10,648.27

3,120.87

67,325.95

15,578.58

67,854.47

19,329.00

Percentage of total appraisal value
Number of tenants
Lease Information(Note)

1,700

Occupancy ratio
As of March 31, 2017

98.2%

95.7%

98.1%

97.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

As of September 30, 2016

99.6%

95.6%

98.1%

98.2%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

As of March 31, 2016

99.4%

96.1%

98.3%

98.7%

100.0%

100.0%

99.2%

100.0%

100.0%

100.0%

100.0%

100.0%

As of September 30, 2015

99.5%

98.0%

98.3%

93.9%

100.0%

100.0%

100.0%

100.0%----

Operating periods

182days

182days

182days

182days

182days

182days

182days

182days

182days

182days

182days

182days①Rental and other operating revenues ( In thousands of yen )Income and Retained Earnings Information

744,902506,235

309,446

258,816

138,718

133,096

72,61041,507

Rental revenues

624,013340,985

211,431

184,154

135,070

130,633

72,61041,507

Other operating revenues

120,889

165,249

98,01474,661

3,648

2,463

-

-

357,840

276,741

161,329

147,098

19,05140,011

6,247

4,602

Property management fees

141,924

82,69047,63153,460

1,800

1,200

1,200

Taxes

70,94623,11735,196

11,88010,411

14,588

4,782

3,136

Utilities

57,184

48,74734,64429,960----

Repairs and maintenance

34,82831,8908,243

13,152

4,592

604

-

-

Insurance

1,806

795

531

300

320

238

-

-

②Property-related expenses ( In thousands of yen )Trust fees and other expenses

51,15089,50035,082

38,344

1,927③NOI（＝①-②） ( In thousands of yen )387,061

229,493

148,116

111,717

119,667

24,154(Note)(Note)(Note)(Note)

425
107,206

93,08563,662

103,42179,361265

265

66,36236,905④Depreciation ( In thousands of yen )85,00849,86332,27815,62730,411

20,37015,59615,127----⑤Rental operating income（＝③-④）( In thousands of yen )302,053

179,630

115,837

96,09089,25686,836

77,48948,534103,42179,361

66,36236,905⑥Capital expenditures ( In thousands of yen )38,505

95,847633

11,949

8,806

4,589

425

-

-

-

-

-

⑦NCF（＝③-⑥） ( In thousands of yen )348,556

133,645

147,483

99,768110,860

102,617

92,66063,662

103,42179,361

66,36236,905

Reference

48.0%

54.7%

52.1%

56.8%

13.7%

8.7%

30.1%

12.2%

12.7%

6.4%

8.6%

11.1%

Property tax for the year 2016 ( In thousands of yen )141,875

45,89770,36923,745

20,79014,53829,16011,26327,077

7,981

9,551

6,257

Assets pledged as collateral○

Expense ratio（＝②／①）

-

-

-

-

51

-

-

-

-

-

-

-

Kenedix Retail REIT Corporation (3453)
平成27年10月2日 平成27年10月2日 平成28年4月21日 平成28年4月20日 平成28年4月21日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年4月16日 平成27年10月2日 平成27年10月2日 平成27年10月2日【Reference】

Earnings Performance for the Individual Properties for the 4th Fiscal Period (October 1, 2016 to March 31, 2017)：182 days ※As of March 31, 2017
Tokyo metropolitan area
Greater Osaka area

Location
Property No.

T-13

Property Name

Inageya Yokohama
Minamihonjuku(Land)

T-14

Acquisition Date

FOctober 2, 2015 October 2, 2015 April 21, 2016 April 20, 2016

Gourmet City
Chiba-Chuo

T-15

T-16

Nakamachidai
Tokyu Store

Central Wellness
Club Nagatsuta
Minamidai

T-17

O-1

O-2

O-3

Piago Kahma
Central SquareHome Center
Life Kameido Blumer Maitamon
Takadono (Land)
Omihachiman
April 21, 2016 February 10, 2015 February 10, 2015 February 10, 2015

O-4

O-5

O-6

O-7

Blumer HAT
KobeCarino Esaka

COMBOX
Komyoike

Hankyu Oasis
Hirakatadeguchi

April 16, 2015 October 2, 2015 October 2, 2015 October 2, 2015

Price
Information

Acquisition price ( In millions of yen )

1,442

760

3,360

1,724

1,450

8,389

2,685

2,140

11,000

6,555

6,450

Percentage of total portfolio

0.9%

0.5%

2.0%

1.0%

0.9%

5.1%

1.6%

1.3%

6.7%

4.0%

3.9%

0.8%

Net book value ( In millions of yen )

1,462

770

3,472

1,795

1,470

8,416

2,727

2,147

11,489

6,622

6,436

1,322

Appraisal value at the end of period ( In millions of yen )

1,430

807

3,820

1,910

1,520

9,230

2,980

2,430

11,600

6,770

6,950

1,330

0.8%

0.5%

2.2%

1.1%

0.9%

5.3%

1.7%

1.4%

6.6%

3.9%

4.0%

0.8%

1

1

1

2

1

50

1

2

1（41）

1（30）

1

1

Percentage of total appraisal value
Number of tenants

1,280

Lease Information

Leasable floor area (㎡)4,405.41

3,488.77

5,968.71

3,996.70

2,929.58

30,037.11

4,437.07

14,313.00

24,185.02

7,540.58

25,530.44

2,960.38

Leased floor area (㎡)4,405.41

3,488.77

5,968.71

3,996.70

2,929.58

29,790.80

4,437.07

14,313.00

23,968.51

7,371.52

25,530.44

2,960.38

As of March 31, 2017100.0%

100.0%

100.0%

100.0%

100.0%

99.2%

100.0%

100.0%

99.1%

97.8%

100.0%

100.0%

As of September 30, 2016

100.0%

100.0%

100.0%

100.0%

100.0%

99.1%

100.0%

100.0%

99.1%

99.1%

100.0%

100.0%

As of March 31, 2016

100.0%

100.0%

-

-

-

99.5%

100.0%

100.0%

98.7%

99.1%

100.0%

100.0%

-

-

-

-

-

99.5%

100.0%

100.0%

99.5%

-

-

-

182days

182days

182days

182days

182days

182days

182days

182days

182days

182days

182days

182daysOccupancy ratio

As of September 30, 2015
Operating periods①Rental and other operating revenues ( In thousands of yen )Income and Retained Earnings Information

59,734

480,332

482,931

289,459

226,261

Rental revenues

58,200364,441

375,391

192,456

226,261

Other operating revenues

1,534

115,891

107,540

97,002-

5,674

208,413

209,123

109,208

33,363②Property-related expenses ( In thousands of yen )Property management fees

(Note)(Note)

3,553(Note)

Taxes
Utilities
Repairs and maintenanceInsurance

65,782

40,7671,800

859,15942,61547,251

24,57430,476-(Note)

324

72,053

68,681

32,053

1,223

11,175

2,783

8,234

-

128

791

1,051

702

674

437

④Depreciation ( In thousands of yen )⑤Rental operating income（＝③-④）( In thousands of yen )⑥Capital expenditures ( In thousands of yen )(Note)

22,618(Note)

23,5732,875

413

31,846

19,686

95,74254,05936,832271,919

63,864

63,617

273,807180,251

192,898-

9,768

20,306

7,745

2,980

50,998-

10,53452,512

28,27132,894

5,201

31,846

9,918

75,43546,31433,852

220,92163,86453,083

221,295

151,980

160,003

32,006

Trust fees and other expenses③NOI（＝①-②） ( In thousands of yen )(Note)

37,207

Reference

-

-

-

-

-

1,935

-

-

3,577

63,148--⑦NCF（＝③-⑥） ( In thousands of yen )31,846

19,686

95,74254,05936,832

269,984

63,864

63,617

270,229

117,102

192,898

37,207

Expense ratio（＝②／①）

11.4%

45.5%

16.9%

9.5%

5.8%

43.4%

7.1%

32.4%

43.3%

37.7%

14.7%

14.5%

Property tax for the year 2016 ( In thousands of yen )5,284

11,43014,145

12,274

8,467

85,207

6,818

29,447

94,48649,13260,941

7,844

Assets pledged as collateral

-

-

-

-

-

52

-

-

○

-

-

-

-

Kenedix Retail REIT Corporation (3453)
平成27年10月2日 平成28年1月21日 平成28年4月21日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成28年4月21日 平成28年11月1日 平成27年2月10日 平成27年2月10日 平成27年2月10日 平成27年2月10日【Reference】

Earnings Performance for the Individual Properties for the 4th Fiscal Period (October 1, 2016 to March 31, 2017)：182 days ※As of March 31, 2017
Greater Osaka area
Greater Nagoya area
Fukuoka area Ordinance-designated cities, core cities and other areas

Location

O-8

Property No.

O-9

O-10

N-1

N-2

N-3

N-4

K’s Denki
Kahma Home
Valor IchinomiyaLife NishiNakagawa
Center Nakagawa
Nishi
Tengachaya
Tomita (Land)
Tomita (Land)
FOctober 2, 2015 January 21, 2016 April 21, 2016 February 10, 2015 February 10, 2015 February 10, 2015
Million Town
Tsukaguchi(Land)

WelciaKishiwadakamori(Land)

Property Name
Acquisition Date

N-5

F-1

R-1

R-2

R-3

Super Sports
K’s Denki
K’s Denki ShinXebio
Sunny Noma
Roseo Mito
AomoriMoriyama (Land)
Aomori-Chuo
HontenApril 21, 2016 November 1, 2016 February 10, 2015 February 10, 2015 February 10, 2015 February 10, 2015
Homecenter
KohnanSunadabashi

Price
Information

Acquisition price ( In millions of yen )

487

1,505

3,723

2,311

2,174

889

7,140

1,370

1,497

10,046

1,469

898

Percentage of total portfolio

0.3%

0.9%

2.3%

1.4%

1.3%

0.5%

4.3%

0.8%

0.9%

6.1%

0.9%

0.5%

Net book value ( In millions of yen )

497

1,568

3,772

2,351

2,155

907

7,165

1,390

1,485

10,031

1,480

898

Appraisal value at the end of period ( In millions of yen )

488

1,660

3,820

2,590

2,310

980

7,310

1,420

1,530

11,000

1,550

928

0.3%

0.9%

2.2%

1.5%

1.3%

0.6%

4.2%

0.8%

0.9%

6.3%

0.9%

0.5%

1

1

1

1

1

1

1

1

1

1（22）

1

1

Percentage of total appraisal value
Number of tenants
Lease Information

Leasable floor area (㎡)3,033.45

2,679.52

8,264.46

Leased floor area (㎡)3,033.45

2,679.52

8,264.46

9,447.48

As of March 31, 2017100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

As of September 30, 2016

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

As of March 31, 2016

100.0%

100.0%-

100.0%

100.0%

100.0%---

100.0%

100.0%

182days

182days

182days

182days

182days(Note)

20,329.07

2,814.67

48,296.15

10,083.41

2,814.67

48,161.79

10,083.41

100.0%

100.0%

99.7%

100.0%

100.0%-

100.0%

99.7%

100.0%

100.0%--

100.0%

100.0%

100.0%

100.0%

100.0%--

100.0%

100.0%

100.0%

100.0%

182days

182days151days

182days

182days

182days

182days(Note)

9,447.48(Note)

20,329.07(Note)

Occupancy ratio

As of September 30, 2015
Operating periods①Rental and other operating revenues ( In thousands of yen )Rental revenues
Income and Retained Earnings Information

44,870375,123

44,870345,065-

30,0582,270

74,688Other operating revenues②Property-related expenses ( In thousands of yen )Property management fees

1,800

(Note)(Note)(Note)(Note)(Note)(Note)(Note)

19,014(Note)

Taxes

8

27,346

Utilities-

23,723

Repairs and maintenance

-

2,257

53

679

Insurance

408

Trust fees and other expenses③NOI（＝①-②） ( In thousands of yen )④Depreciation ( In thousands of yen )⑤Rental operating income（＝③-④）( In thousands of yen )⑥Capital expenditures ( In thousands of yen )(Note)(Note)

1,666

10,68942,59988,52760,02962,073

22,951

190,249

26,73740,385300,435

46,054

-

4,682

-

-

14,526-40,500-14,25347,286

6,365

28,394
4,894

10,68937,91788,52760,02947,546

22,951

149,749

26,737

26,132

253,148

39,68823,500

Reference

-

-

-

-

-

-

-

-

-

-

-

-

⑦NCF（＝③-⑥） ( In thousands of yen )10,68942,59988,52760,02962,073

22,951

190,249

26,73740,385300,435

46,05428,394

Expense ratio（＝②／①）

19.0%

5.1%

1.6%

9.6%

21.3%

13.1%

1.6%

4.5%

22.0%

19.9%

17.2%

16.4%

Property tax for the year 2016 ( In thousands of yen )

2,073

6,507

6,884

9,869

20,2183,949

39,652

4,296

7,455

54,675

14,392

6,501

Assets pledged as collateral

-

○

-

-

-

53

-

-

-

-

-

-

-

Kenedix Retail REIT Corporation (3453)
平成27年10月2日 平成27年10月2日 平成27年10月2日 平成28年4月21日 平成28年4月22日 平成29年1月31日【Reference】

Earnings Performance for the Individual Properties for the 4th Fiscal Period (October 1, 2016 to March 31, 2017)：182 days ※As of March 31, 2017
Ordinance-designated cities, core cities and other areas

Location
Property No.
Property Name

R-4

R-5

R-6

R-7

R-8

R-9

Ashico Town
Ashikaga

Yorktown
ShindenHigashi

KasumiTechnopark
SakuraSolala PlazaP-1 Plaza Tenno

Seiyu Rakuichi
Moriya (Land)

Total of 42
Properties

FOctober 2, 2015 October 2, 2015 October 2, 2015 April 21, 2016 April 22, 2016 January 31, 2017

Acquisition Date
Price
Information

Acquisition price ( In millions of yen )

4,180

3,252

830

5,720

4,010

4,111

Percentage of total portfolio

2.5%

2.0%

0.5%

3.5%

2.4%

2.5%

100.0%Net book value ( In millions of yen )

4,379

3,329

854

5,718

4,187

4,320

166,782

Appraisal value at the end of period ( In millions of yen )

5,060

3,330

873

5,960

4,340

4,210

175,276

2.9%

1.9%

0.5%

3.4%

2.5%

2.4%

100.0%

Number of tenants

1（29）

2

1

1

7

1

409

Leasable floor area (㎡)65,616.31

12,768.77

2,047.65

Leased floor area (㎡)65,616.31

12,768.77

2,047.65

As of March 31, 2017100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

99.6%

As of September 30, 2016

99.1%

100.0%

100.0%

100.0%

100.0%-

99.7%

As of March 31, 2016

99.1%

100.0%

100.0%

-

-

-

99.6%

-

-

-

-

-

-

182days

182days

182days

182days

182days

60daysPercentage of total appraisal value

12,030.83

Lease Information(Note)

164,338

719,906.77(Note)

12,030.83

717,011.12

Occupancy ratio

As of September 30, 2015
Operating periods①Rental and other operating revenues ( In thousands of yen )Rental revenues

270,886

136,260

6,427,481

203,746

135,630

5,524,740

Income and Retained Earnings Information

67,139630

902,740

139,330

13,392

2,096,378

Other operating revenues②Property-related expenses ( In thousands of yen )99.6%
179days *Total: Cost-weighted average operating period (days)

Property management fees

38,871Taxes

25,382

8

482,777

Utilities

54,568264

438,881

Repairs and maintenance

10,251

9,077

157,638658

721

12,281

Insurance
Trust fees and other expenses

9,600③NOI（＝①-②） ( In thousands of yen )131,555(Note)(Note)

2,843(Note)

691,625(Note)

477
98,81022,726

159,004

313,173

122,868

9,212

4,331,103④Depreciation ( In thousands of yen )28,348

13,621

2,661

43,111

15,857-

721,606⑤Rental operating income（＝③-④）( In thousands of yen )103,20785,18820,064

115,892

107,0109,212

3,609,497⑥Capital expenditures ( In thousands of yen )37,408

368

-

-

8,962

-

276,156⑦NCF（＝③-⑥） ( In thousands of yen )94,14698,442

22,726

159,004

113,905

9,212

4,054,946

Reference

Expense ratio（＝②／①）

51.4%

36.1%

19.4%

20.5%

9.8%

5.2%

32.6%

Property tax for the year 2016 ( In thousands of yen )50,75031,456

4,008

30,81829,901

22,483

1,139,884

Assets pledged as collateral

-

-

-

-

-

Note:We have not obtained consent from the tenant(s) to release this information.

54-

Kenedix Retail REIT Corporation (3453)(Reference) Borrowings
Classification

Borrowings on a financial institution basis as of March 31, 2017 are as follows:
Balance at the
Increase during Decrease during Balance at the
beginning of
the period
the period
end of period
Lenderperiod(Thousands of (Thousands of (Thousands of(Thousands of
yen)
yen)
yen)
yen)
Sumitomo Mitsui Banking Corporation
2,050,000
2,050,000-

Short-Term Loans Payable

Sumitomo Mitsui Banking Corporation

2,450,000-

2,450,000-

Sumitomo Mitsui Banking Corporation

450,000-

450,000-

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

450,000-

450,000-

Mizuho Bank, Ltd.

400,000-

400,000-

Resona Bank, Ltd.

250,000-

250,000-

Aozora Bank, Ltd.

250,000-

250,000-

Sumitomo Mitsui Trust Bank, Ltd.

200,000-

200,000-

4,140,000--

4,140,000

360,000--

360,000

1,070,000--

Sumitomo Mitsui Banking Corporation（Note 7）-

4,500,000

Sumitomo Mitsui Banking Corporation-

450,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

-

Mizuho Bank, Ltd.

-

Resona Bank, Ltd.

Sumitomo Mitsui Banking Corporation

Averageinterest rate
Payment due date
(Note 2)
（Note 4）(Note 3)(％)
0.530 October 2, 2016
0.530

1,070,000

0.480

April 21, 2017

600,000

3,900,000

0.480

October 3, 2017-

450,000

450,000-

450,000

400,000-

400,000-

250,000-

250,000

Aozora Bank, Ltd.

-

250,000-

250,000

Sumitomo Mitsui Trust Bank, Ltd.

-

200,000-

200,000

Sub Total
Current Portion ofLong-Term
Loans Payable

12,070,000

6,500,000

7,100,000

11,470,000

Sumitomo Mitsui Banking Corporation (Note 8)

2,300,000--

2,300,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd. (Note 8)

800,000--

800,000

Mizuho Bank, Ltd. (Note 8)

400,000--

400,000

Mizuho Trust & Banking Co., Ltd. (Note 8)

350,000--

350,000

3,850,000--

3,850,000

Sumitomo Mitsui Banking Corporation

2,400,000--

2,400,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

800,000--

800,000

Mitsubishi UFJ Trust and Banking Corporation

800,000--

800,000

Sumitomo Mitsui Trust Bank, Ltd.

550,000--

550,000

Aozora Bank, Ltd.

500,000--

500,000

Resona Bank, Ltd.

500,000--

500,000

The Gunma Bank, Ltd.

400,000--

400,000

The Musashino Bank, Ltd.

400,000--

400,000

Mizuho Bank, Ltd.

350,000--

350,000

Mizuho Trust & Banking Co., Ltd.

300,000--

300,000

Sumitomo Mitsui Banking Corporation

3,000,000--

3,000,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

700,000--

700,000

Sumitomo Mitsui Trust Bank, Ltd.

500,000--

500,000

Aozora Bank, Ltd.

450,000--

450,000

Resona Bank, Ltd.

450,000--

450,000

Sub Total

Mizuho Bank, Ltd.

Long-Term Loans Payable

400,000--

400,000

Sumitomo Mitsui Banking Corporation

2,600,000--

2,600,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

800,000--

800,000

Sumitomo Mitsui Trust Bank, Ltd.

600,000--

600,000

Aozora Bank, Ltd.

400,000--

400,000

Mizuho Trust & Banking Co., Ltd.

400,000--

400,000

Mizuho Bank, Ltd.

300,000--

300,000

Resona Bank, Ltd.

0.545 February 10, 2018--

300,000-

1,500,000

0.925 February 10, 2021

Development Bank of Japan Inc.（Note 6）

1,600,000--

1,600,000

1.033 February 10, 2022

Sumitomo Mitsui Banking Corporation

4,600,000--

4,600,000

1.366

April 16, 2025

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

750,000--

750,000

Aozora Bank, Ltd.

500,000--

500,000

Mizuho Bank, Ltd.

400,000--

400,000

0.534

March 31, 2019

Sumitomo Mitsui Trust Bank, Ltd.

200,000--

200,000

Resona Bank, Ltd.

200,000--

200,000

The Musashino Bank, Ltd.

150,000--

150,000

0.975

March 31, 2023

0.994

March 31, 2023

0.545

March 31, 2019

0.987

March 31, 2023

1.013

March 31, 2023--

1,000,000--

600,000

Mizuho Bank, Ltd.

400,000--

400,000

Resona Bank, Ltd.

400,000--

400,000

Mizuho Trust & Banking Co., Ltd.

400,000--

400,000

Mitsubishi UFJ Trust and Banking Corporation

400,000--

400,000

Development Bank of Japan Inc.（Note 6）

1,500,000--

1,500,000

Sumitomo Mitsui Banking Corporation

1,850,000--

1,850,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

550,000--

550,000

Sumitomo Mitsui Trust Bank, Ltd.

500,000--

500,000

Resona Bank, Ltd.

300,000--

300,000

The Musashino Bank, Ltd.

250,000--

250,000

Mitsubishi UFJ Trust and Banking Corporation

450,000--

450,000

Resona Bank, Ltd.

200,000--

200,000

The Musashino Bank, Ltd.
Development Bank of Japan Inc.（Note 6）

150,000--

150,000

1,500,000--

1,500,000

55(Note 5)

Unsecured/Non-guaranteed

0.978 February 10, 2022-

600,000

Unsecured/Non-guaranteed

0.865 February 10, 2021

300,000

1,000,000(Note 5)0.751 February 10, 2020

1,500,000

Sumitomo Mitsui Trust Bank, Ltd.

Unsecured/Non-guaranteed

0.430 February 10, 2018

Development Bank of Japan Inc.（Note 6）

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

(Note 5)0.480 February 10, 2017

April 21, 2017

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

Remarks

October 2, 2016

0.480

Mizuho Bank, Ltd.

Use

Kenedix Retail REIT Corporation (3453)
Classification

LenderSumitomo Mitsui Banking Corporation

Balance at the
Increase during Decrease during Balance at the
beginning of
end of period
the period
the period
period(Thousands of (Thousands of (Thousands of(Thousands of
yen)
yen)
yen)
yen)
3,000,000
3,000,000

Mizuho Bank, Ltd.

1,150,000--

1,150,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

1,000,000--

1,000,000

Mizuho Trust & Banking Co., Ltd.

700,000--

700,000

Sumitomo Mitsui Trust Bank, Ltd.

650,000--

650,000

Resona Bank, Ltd.

Averageinterest rate
(Note 2)
(Note 3)(％)

Payment due date
（Note 4）Long-Term Loans Payable

1.110

March 31, 2024

1.243

April 16, 2025

500,000--

500,000

Sumitomo Mitsui Banking Corporation

1,500,000--

1,500,000

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

400,000--

400,000

Mizuho Bank, Ltd.

710,000--

710,000

Sumitomo Mitsui Trust Bank, Ltd.

620,000--

620,000

Sumitomo Mitsui Trust Bank, Ltd.

450,000--

450,000

0.803 September 30, 2024

Development Bank of Japan Inc.（Note 6）

890,000--

890,000

0.760 September 30, 2024

Sumitomo Mitsui Banking Corporation

2,670,000--

2,670,000

0.932

April 21, 2026

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

890,000--

890,000

0.888

October 31, 2025

0.368 September 30, 2019

The Gunma Bank, Ltd.（Note 6）-

500,000-

500,000

Development Bank of Japan Inc.（Note 6）-

2,000,000-

2,000,000

1.049

Mizuho Trust & Banking Co., Ltd.（Note 6）-

1,000,000-

1,000,000

1.049
1.002

Resona Bank, Ltd.
Sub Total
Total-

500,000-

500,000

53,380,000

4,000,000-

57,380,000

69,300,000

10,500,000

7,100,000

72,700,000

Use

Remarks(Note 5)

Unsecured/Non-guaranteed

0.550 September 30, 2021

January 31, 2027

Note 1: Annual repayments of long-term loans payable (except for current portion of long-term loans payable) scheduled after the balance sheet date are as follows:(Thousands of yen)
Due after 1 year
through 2 years
Long-term loans payable

5,650,000

Due after 2 years
through 3 years

Due after 3 years
through 4 years

8,330,000

Due after 4 years
through 5 years

7,000,000

7,500,000

Due after 5 years
28,900,000

Note 2: All debts except for the following Note 6 are borrowings at a floating rate.
Note 3: Average interest rates are the weighted average during the period and figures are rounded to the nearest third decimal place. Also, with regard to borrowings for which interest rate swap transactions were implemented in order tohedge the interest rate volatility risk, the weighted average interest rates taking into consideration the effects of the interest rate swaps are indicated.
Note 4: All the repayment methods of debt financing except for the following Note 7 are lump-sum repayments on the due date.
Note 5: All debts were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate (additional expenses are included) and repayment of debts.
Note 6: Borrowings at a fixed rate.
Note 7: Partial prepayment of 600,000 thousand yen was made on October 31, 2016.
Note 8: Borrowings are listed in the current portion of long-term loans payable from the fiscal period under review, listed in long-term loans payable in the previous fiscal period.

56