Financial Results
for the 2nd Financial Period
ended Mar. 2016

May 20, 2016

Contents
Section 1

Increasing importance of shopping centers for daily needs
Section 2

Financial results for the fiscal period ended Mar. 31, 2016
Section 3

Implementation of growth strategies
Appendix 1

Key characteristics of Kenedix Retail REIT Corporation
Appendix 2

Detailed financial results and portfolio information

3

8

14

35

42

Section 1

Increasing importance of shopping centers for daily needs

Investments focusing on shopping center for daily needs"Daily / Neighborhood" type

VS

"Weekend / Destination" type

Small

Trade area

Large

High

Frequency of customer visits

Low

Our focus: Neighborhood, community andother shopping centers for daily needs
Property types

Characteristics

Trade
area

NSC

Shopping centers with asupermarket as an anchor or coretenant3~5km

SMSupermarkets

Stand-alone stores that primarily
provide groceries

3km

CSC

Community
Shopping
Centers

Larger Shopping centers than NSC,
with a supermarket as an anchor orcore tenant

5~10km

Shopping centers in the immediate
vicinity of an urban public
transportation station

3~5km

Specialty stores such as drug stores,
convenience stores, health clubs orelectronic appliance stores

1~10kmSS

Specialty
Stores

Large-scale suburban retail properties
RSC (Regional Shopping Center)

Neighborhood
Shopping
Centers

Urban Station-Front

The majority of portfolio properties of other listed
retail-focused J-REITs

GMS (General Merchandise Store)
Stand-alone GMS is excluded from our investment criteria

Outlet malls

Urban retail properties featuring
High-end brand shops

4

Ample investment opportunities in shopping centers for daily needs

Ample investment opportunities
in shopping centers for daily needs

Tenants with high demand fromconsumers

Properties located in areas
with high population density

Ample investment
opportunities

77.2%

55.4%

92.3%

Share of frequently purchased items
for daily needs(Note 4) as a % of total
household expenditure on consumer
products% of Japan's total population
living in suburban areas within the four
major metropolitan areas% of medium- or small-sized retailfacilities in "retail property opening
applications"(Note 1)

(Note 2)

(Note 5)(Note 3)Note 1: The share of frequently purchased items for daily needs as a % of total household expenditure on consumer products according to a survey conducted by the Statistics Bureau of the Ministry of Internal Affairs and Communications in 2014.
Note 2: % of Japan's total population living in suburban areas within the four major metropolitan areas, according to a survey conducted by the Statistics Bureau of the Ministry of Internal Affairs and Communications in 2015 based on preliminary census data.
Note 3: % of applications submitted to develop new retail properties with a total floor area of 10,000 m2 or less from 2005 to 2014.
Note 4: "Frequently purchased items for daily needs" refers to items that can be selected quickly, such as convenience foods and household commodities.
Note 5: "Suburban areas within the four major metropolitan areas" refers to the four major metropolitan areas excluding Tokyo (Chiyoda ward, Chuo ward, Minato ward, Shinjuku ward and Shibuya ward), Osaka (Kita-ku, Chuo-ku, Fukushima-ku, Nishi-ku, Naniwa-ku and Tennoji-ku)
and Nagoya (Nishi-ku, Naka-ku and Nakamura-ku).

5

Increasing importance of shopping centers for daily needs
Increase in market share of specialty supermarkets and decrease in market share of GMS (General Merchandise Stores)

Shares of specialty supermarkets and GMS in retail sector

Background for increasing importance of NSC
20%

17.5%

18.1%

17.7%

18.3%

16.5%

Increasing importance of NSC
16%
13.8%
12.0%
12%

Shrinking retail trade area

Increase in demand
for specialty stores

9.9%
8%

6.0%

6.5%

6.7%

6.3%

6.2%

6.3%

5.5%

4.9%

4%

Further aging of the population
Concentrated population in thefour major metropolitan areas

Diversification of
consumer needs

0%
平成3年
1991

平成6年
1994

平成9年
1997

平成11年
1999

平成14年
2002

Specialty supermarkets
専門スーパー

Source:Typical GMS

平成16年
2004

平成19年
2007

平成26年
2014

GMS
総合スーパー

Ministry of Economy, Trade and Industry

Typical NSC
Check! Reason why NSCs are supported from consumers  See next page
Supermarket

Parking
4F Furniture & home appliances
3F Lifestyle goods

Shifting from GMS
to specialty stores
Parking lot

Specialty stores (including national chains)˗e.g. Clothing, eatery, tutoring school,
dental clinics

Home & garden
store

2F Clothing
1F Grocery6

Convenient shopping experience at shopping centers for daily needs
Large ground parking lot

Low-rise facility

Easy access by foot or bicycle

Sunny NomaUnicus Ina

Life Kameido

Buying behavior of elderly residents in Tokyo (1)Buying behavior of elderly residents in Tokyo (2)Buying behavior of elderly residents in Tokyo (3)Frequent shoppers

Preference for supermarkets

Access by foot or bicycle

Consumers who go shopping "almost
daily" or "3 to 4 times a week"

Consumers who identify supermarkets as"most frequently used type of retail property
for purchasing groceries"

Consumers who travel to "most frequently
used retail properties" by foot or bicycle

50.0%

69.4%

72.7%

Source： Bureau of Industrial and Labor Affairs of the Tokyo Metropolitan Government "Reports on shopping trends of the elderly" (Dec. 2011)7

Section 2

Financial results for the fiscal period ended Mar. 31, 2016

Investment summary since the previous financial announcement
External growthInternal growth

Financial strategies

 Acquired 8 shopping centers for dailyneeds Proactively promote internal growth Further strengthen our financial positionProperty expansions on underutilized space- Property expansion completed at Roseo Mito
New!
- Property expansion at Unicus Ina has been decided

Follow-on equity offering closed in April 2016
- Issued 67,200 new investment units (incl. OA)Optimization of tenant mix- Rents unchanged or raised in 86.5% of all rent
revisions for this fiscal year

New borrowings on April 21 and 22, 2016
- Average maturity after the borrowings: 4.9 years- Average interest rate after the borrowings: 1.01%

Total acquisition price of JPY28.6 bn and a total
appraisal value of JPY29.7 bn- 7 properties acquired in April 2016
- 1 property flexibly acquired in the 2nd financial period



Average appraisal NOI yield: 5.2%

Properties located in four major metropolitan areas /ordinance-designated cities



Selective acquisitions under a relatively favorable
acquisition environment, with emphasis on:- Demographics and high population density in thesubject retail trade areas- Traffic convenience and locational advantages- Tenant mix highly attractive to customers※ After deducting the expected prepayment of JPY800 mn due on
May 31, 2016

Trend of tenants' revenue- Revenue growth against last year: Average of 102%



Effective utilization of CAPEX- NOI improved by the installation of LED lighting andother cost saving measures

8,000

6,000

7,414

6,846

LTV

42.7%

42.5%

Acquisition capacity

JPY5.5bn

JPY7.7bn

NAV per unit
実績/予想
Actual/forecast

当初予想
Initial forecast(Note)

（円）
(JPY)
250,000

5,865

243,398

5,897

6,542
5,434

After PO※The amount assuming a LTV of 45% and the prepayment of theborrowings due on May 31, 2016

DPU
(JPY)

Before PO

240,000

5,555

4,000

237,472

239,889

230,000

2,000

220,000

0
1st
period (Actual)
第1期（実績）nd period (Actual)2第2期（実績）

3rd 第3期（予想）period (Forecast)

4th第4期（予想）period (Forecast)Stabilized DPU

Upon IPO

Upon 1st PO

Upon 2nd PO

assuming thatproperty-related taxes
are expensed

JPY4,600

JPY5,555

JPY5,738

Note: Initial forecast represents the DPU estimate for each financial period stated in the material which we first announced earnings
estimation after our listing

210,000
200,000
0

End第1期末
of 1st period

End第2期末
of 2nd period

第2回PO後Post 2nd PO

NAV per unit at the end of each financial period = (NAV + appraisal gains/losses on the entire portfolio at the end of each financial period) ÷(total
number of investment units issued at the end of each financial period)
NAV per unit after the second PO = (NAV at the end of the 2nd financial period + the amount paid in relation to the issuance of new investment
units, which was resolved on March 31, 2016 + appraisal gains/losses on the entire portfolio as of April 30, 2016) ÷ total number of investment
units issued as of May 19, 2016 (same for below)

9Summary of Balance Sheets
Balance Sheets
1st period

Current assets
Total property, plantand equipment, net

2nd period(JPY mn)

Change(JPY mn)(JPY mn)(JPY mn)(%)

14,043

14,960917

6.5%

93,404133,488

40,08342.9%

Factors in change of current assets
Increase in cash and deposits in trust due to increase in
1. tenant lease hold and deposits in trust
2. Decrease in consumption taxes receivable
3. Others+2,511-1,561-33

Factors in change of non-current assets
Intangible assets

173

530

357

205.8%

Investments andother assets

558

753

195

34.9%

94,136

134,772

40,63643.2%

Non-current assets

1. Increase in PP&E due to acquisition of assets
Increase in intangible assets due to increase in leasehold
2. right in trust attributable to acquisition of assets
Increase in long-term prepaid expenses due to payment of
3. upfront fee related to debt financing
4. Others+40,083
+357
+164
+30

Factors in change of deferred assets
Deferred assets

202

276

74

36.7%

1. Increase in investment unit issuance costs related to 1st PO
2. Other (amortization of organization costs)

108,382

150,00941,627

38.4%

Current liabilities

3,476

8,283

4,807

138.3%

Non-current liabilities

45,11561,69016,575

36.7%

Total assets

Total liabilities
Total net assets
LTV (%)

48,591
59,79040.6%

69,97480,03442.7%

21,382
20,244
---

44.0%
33.9%
---

Factors in change of current liabilities
Increase in short-term loans payable due to acquisition of
1. assets in connection with 1st PO
2. Other
Factors in change of non-current liabilities
Increase in long-term loans payable due to acquisition of
1. assets in connection with 1st PO
Increase in tenant lease hold and deposits in trust due to
2. acquisition of assets
3. Other+79-5+4,500+307+14,650+1,910+14

Factors in change of net assets
1. Increase in unitholder’s capital due to 1st PO+19,749

2. Increase in unappropriated retained earnings

+494

10

Summary of Statements of Income and Retained Earnings
Statements of Income and Retained Earnings (JPY mn)
1st period

Factors for changes from forecast

2nd period

ChangesFrom
From
1st period Forecast

ActualForecast

Actual

4,128

4,593

4,656

+528

+62

975

929

884

-90

-44

5,103

5,522

5,541

+437

+18

Property related expenses(excluding depreciation)

1,685

1,736

1,669

-15

-66

NOI

3,417

3,786

3,871

+453

+84

560

555

565

+4

+10

NOI after depreciation

2,856

3,231

3,305

+448

+73

Other operating expenses

393

462

479

+85

+16

Rent revenue – real estate
Other lease business revenue
Operating revenues

Depreciation

Operating income

2,463

2,769

2,826

+362

+56

Non-operating income

1

0

1

+0

+1

Non-operating expenses

524

426

398

-125

-27

Ordinary income

1,939

2,343

2,428

+489

+85

Net income

1,933

2,342

2,427

+494

+85

DPU (JPY)

7,414

6,605

6,846

-568

+241

Increase in revenue/profit due to acquisition of Life NishiTengachaya on Jan. 21, 2016
Operating revenues(JPY mn)

Operating revenues from Life Nishi-Tengachaya+17

Shorter down-time than expected
Utility charge reimbursement
OthersOperating expenses
Operating expenses for Life Nishi-Tengachaya
Utilities
Repairs and maintenance
OthersNon-operating expenses
Interest expenses and financing-related expenses
Amortization of investment unit issuance costs

+45
-37
-7
+3
-70
+50
-23
-1
-2

Factors for changes from 1st period
Increase in revenue/profit due to acquisition of 14 properties
acquired in 2nd period, in spite of decrease in operating days
from 233 days in 1st period to 183 days in 2nd period
NOI
19 properties acquired in 1st period
14 properties acquired in 2nd period
Depreciation
19 properties acquired in 1st period
14 properties acquired in 2nd period
Non-operating expenses
Arrangement fee related to debt financing
Amortization of investment unit issuance costs(JPY mn)-637+1,090
-114
+119
-180
+15

Note: The Forecasts shown above are based on assumptions in the “Financial Report for the Fiscal Period Ended September 30, 2015 (REIT) (October 3,
2014 to September 30, 2015)”

11

Financial forecasts: 3rd fiscal period（Sep. 2016）
2nd Period(Mar. 2016)(Actual)

3rd Period(Sep. 2016)(Forecast)

Changes

Factors for changes from previous period (JPY mn)
Operating revenues

Key financial information (JPY mn)

Existing assets

・・・

+84

・・・

+767

Property taxes (existing assets)

・・・

+483

Property-related expenses (new assets)

・・・

+211

Others・・・+40

Operating revenues

5,541

6,392

+851

New assets acquired in 3rd fiscal period

Operating expenses

2,715

3,449

+734

Operating expenses(Major operating expense)

Depreciation

565

711

+145

Operating income

2,826

2,943

+117

Non-operating expenses

398

468

+69

(Major non-operating expense)

Financing-related expenses (incl. interest expenses)
Amortization of investment unit
issuance costs & organization costs

334

383

+48

64

84

+20

Ordinary income

2,428

2,475

+46

Net income

2,427

2,472

+44

NOI

3,871

4,192

+321

NOI yield (%)(Note1)

5.9%

5.4%

---

Related key indicator (JPY mn)

NOI after depreciation

3,305

3,480

+175

NOI yield after depreciation(%)(Note1)

5.1%

4.5%

---

Breakdown of operating income (JPY mn)
Operating revenues (A)Rent revenue – real estate・・・
Utility charge reimbursement
・・・
Other revenues
・・・
Property-related expenses (B) (excl. depreciation)
PM fees / facility management fees
・・・
Utilities
・・・
Taxes
・・・
Repairs and maintenance・・・
Sales and promotion
・・・
Others・・・
NOI (A-B)
・・・

5,406
568
417
683
592
483
131
178
130
4,192

Factors for changes in net income (JPY mn)
+686
2,427

-203

-483

-69

-2

(5)

(6)

2,472

+118

FFO
LTV

(Note2)

3,058

3,268

+210

42.7%

42.5%

---

Note1: Property taxes for the properties owned in the 2nd period were not expensed in the 2nd fiscal periods, nor are those forproperties acquired in 2016 expensed in the 3rd fiscal period.
Note2: FFO = Net income + Depreciation + Amortization - Gain on sale of property + Loss on sale of property

(1)

(2)

(3)

(1)Property taxes(2)Factors other thanproperty tax
2nd period
14(3)2Increase3in NOI due
Actualto asset acquisition(4)(4)Other operating
expenses(5)Non-operating
5
7
expenses6(6)Taxes and other3rd period
8
Forecast

12

Financial forecasts: 4th fiscal period（Mar. 2017）
3rd Period(Sep. 2016)(Forecast)

4th Period(Mar. 2017)(Forecast)

Factors for changes from previous period (JPY mn)

Changes

711

715

+4

Operating income

2,943

2,957

+14

Operating revenues
Increase in rent revenue-real estate
Decrease in utility charge reimbursement
OthersOperating expenses
Decrease in utilities
Decrease in repairs and maintenance
Increase in sales and promotion
OthersNon-operating expenses

468

470

+1

Breakdown of operating income (JPY mn)

Key financial information (JPY mn)
Operating revenues

6,392

6,365

-27

Operating expenses

3,449

3,407

-42

(Major operating expense)

Depreciation(Major non-operating expense)

Financing-related expenses(incl. interest expenses)
Amortization of investment unit
issuance costs & organization costs

383

384

+1

84

84

0

Ordinary income

2,475

2,488

+13

Net income

2,472

2,485

+13

NOI

4,192

4,248

+56

NOI yield (%)(Note1)

5.4%

5.4%

---

Related key indicator (JPY mn)

NOI after depreciation

3,480

3,532

+51

NOI yield after depreciation(%)(Note1)

4.5%

4.4%

---

FFO(Note2)

3,268

3,286

+17

Operating revenues (A)Rent revenue – real estate
Utility charge reimbursement
Other revenues
Property-related expenses (B) (excl. depreciation)
PM fees / facility management fees
Utilities
Taxes
Repairs and maintenance
Sales and promotion
OthersNOI (A-B)

42.5%

42.5%

---

+80
-82
-24

・・・
・・・
・・・
・・・

-67
-42
+12
+14

・・・
・・・
・・・

5,486
485
393

・・・
・・・
・・・
・・・
・・・
・・・
・・・

692
524
483
89
191
136
4,248

+6

2,485

Factors for changes in net income (JPY mn)
+56

-4

(1)

(2)

2,472

第3期

LTV

・・・
・・・
・・・

3rd period
Forecast

(1)
(2)
(3)
(4)

-45
(3)

Increase in NOI
Increase in depreciation
Increase in asset management fee
Other factors for net income

NOIの増加

減価償却費の増加

運用報酬の増加

(4)

その他

第4期

4th period
Forecast

Note1: Property taxes for the 8 properties acquired in 2016 are not expected to be expensed in the 3rd and 4th fiscal periods.
Note2: FFO = Net income + Depreciation + Amortization - Gain on sale of property + Loss on sale of property

13Section 3-1

Implementation of growth strategy (External growth)External growth

Summary of 2nd Public Offering (PO)
Summary of 2nd PO

Unit price since IPO (Feb 10, 2015 ~ May 10, 2016)

Global offering
Offering structure Japanese and international(Reg.S+144A)
Offering size

Number of units
IssuedJapanese:
International:
Over-allotment (OA):

JPY 8,149 mn
JPY 8,280 mn
JPY 821 mn

67,200 units (including OA 3,200 units)
Japanese：31,744 units
International：32,256 units(JPY)(JPY mn)

320,000

160,000
時価総額（右軸）
MarketCap(Right axis)

300,000

投資口価格（左軸）
Unit Price(Left axis)

東証REIT指数（左軸）
Unit
Price
Unit
Price
(Left
axis)
(Left
axis)
140,000

280,000
120,000
260,000

Offer price
240,000

Total number ofunits outstanding(after 2nd PO)

422,450 units

Offer price

JPY 256,717

100,000

220,000
80,000200,000
60,000180,000

Net proceeds

Launch date

JPY 16,649 mn

160,000
2015/2/10

2015/5/10

2015/8/10

2015/11/10

40,0002016/5/10

2016/2/10

March 31, 2016
Key achievements
May

2016

Pricing date

April 13, 2016

Jan.

Nov.
Aug. – Oct.

Application period April 14 – April 15, 2016

Apr.

2015
Feb.

Payment date

April 20, 2016

• IPO

Mar.
• Acquisition ofBlumer HAT
Kobe• Property
expansion at
Roseo Mito

• 1st PO• 1st period
earnings• Acquisition ofLife NishiTengachaya

Mar. – Apr.
• 2nd PO• 2nd period
earnings• Property
expansion atUnicus Ina

Seek our units to be
included in the major
global real estate
index

15

External growth

Our portfolio after acquisition of new properties
End of the 1st period(Sep. 30, 2015)

End of the 2nd period(Mar. 31, 2016)

After acquisition of
new properties

18

19

33

40

Total acquisition price (JPY bn)

80.8

91.8

131.6

158.7

Total appraisal value (JPY bn)

82.3

95.7

138.6

166.7

Portfolio appraisal NOI yield(Note 1)

5.5%

5.4%

5.4%

5.4%

NOI yield after depreciation(Note 1)

4.3%

4.3%

4.4%

4.4%

Weighted average occupancy rate(Note 2)

98.6%

99.6%

99.6%

99.7%

286

321

389

403

% of properties in the four major
metropolitan areas

85.1%

86.9%

84.3 %

80.8%

Weight of the top 10 tenants(Note 2)

45.0%

40.3%

39.5%

37.5%

33.4%

40.6%

42.7%

42.5%

227,886

237,472

239,889

243,398

At listing(Feb. 10, 2015)
Improving portfolio profitability and stability
Number of properties

Number of tenants(Note 2)

Leveraging acquisition capacity and increase in NAV
LTV(Note 3)
NAV per unit(Note 4)

Note 1: “Appraisal NOI yield” refers to the annual net operating income assumed by the appraiser of the relevant property for the direct capitalization analysis in the latest appraisal reports at the acquisition date. “NOI yield after depreciation” based on the forecast for fiscal period
ending September 30, 2016.
Note 2: The figures at listing are as of September 30, 2014 and those after acquisition of new properties are as of March 31, 2016. .
Note 3: “LTV” refers to "loan-to-value ratio", which is calculated as the ratio of the total amount of short-term debt, long-term debt, corporate bonds and tenant leasehold and security deposits (net amounts reserved for return of tenant leasehold and secur ity deposits) divided by total
assets as of the end of the previous fiscal period minus amounts reserved for return of tenant leasehold and security deposits. (same for below)
Note 4: NAV per unit at listing = (Unitholder’s equity + unrealized profit / loss of the portfolio at listing)/(Number of units outstanding as of February 10, 2015).

16

External growthCharacteristics of our portfolio
Changes in property distribution (by acquisition price)

Location (by acquisition price)SM
7.2%

Post 2nd PO

At listing

Fululu Garden
Yachiyo11.4%

Fululu Garden
Yachiyo
18.4%

CSC
9.4%

Shopping centers
for daily needs

100%

Blumer HAT Kobe
6.9%
Roseo Mito
6.3%

Others
42.0%

Top 5
properties

57.9%

Bulmer Maitamon
10.4%
Passaggio Nishiarai
7.2%

SS
13.0%

Top 5
properties

Roseo Mito
12.0%

Blumer Maitamon
5.3%

33.0%

MONA Shin-Urayasu
5.1%

Others67.0%

Urban
StationFront SC
24.0%

MONA Shin-Urayasu
10.0%Changes in share of top 10 tenants (by annual fixed rent)

Types of retail property (by acquisition price)

Post 2nd PO

At listing

a
6.1%

A
11.2%
B
4.7%

b
4.7%

Ordinance-designatedcities,政令指定都
core cities and
市・中核市等
other
areas
19.2%
c
4.7%
d
4.3%

C
4.4%

Others54.9%

Top 10tenantsD
4.2%

Top 10tenants

45.0%

E
4.0%

37.5%

F
3.9%

J
2.7%

I
2.8%

G
3.9%
H
3.3%

NSC
46.5%

Others
62.5%

e
3.8%
f
3.7%

j
2.1%

Fukuokaarea
0.9%
Greater
Nagoyaarea
7.9%

4 majormetropolitan
areas

Tokyo
metropolitan
area
44.2%

80.8%

g
3.7%
h
2.3%
i
2.1%
Greater
Osaka
area
27.8%

Note 1: The figures are as of March 31, 2016 for the 40 properties acquired by the date of this material.

17External growth

Properties acquired in connection with 2nd PO
1

Located in the four major metropolitan areas or ordinance-designated cities
23

Retail trade areas that benefit from increases in population

Densely populated retail trade areas with a large consumer basePotential for high population growth from nearby large-scale housing development projects and "new town" developments

Highly accessible properties

4

Located in the four major metropolitan areas or ordinance-designated cities with relatively stable demographics

Easily accessible by foot, bicycle or car due to the properties' proximity to main roads, direct accessibility from stations and large parking areas

Tenant mix attractive to customers
Quality tenants offering a diverse range of goods and services closely tied to daily life
Urban
Station-Front

SS

Solala Plaza

Homecenter Kohnan
Sunadabashi

NSC
SM

Million Town
Tsukaguchi (Land)

100%

Retail trade population
growth rate

＋4.7%

Within 30 minutes
from the nearest station to
major stations

86.0%(Note 1)

Life Kameido

SMLife
Nishi-Tengachaya

Properties located in the four
major metropolitan areas orordinance-designated cities

NSC
P-1 Plaza Tenno

NSC
Nakamachidai
Tokyu Store(Note 2)SS
Central Wellness Club
Nagatsuta Minamidai

Portfolio Map: Click URL below
http://www.krr-reit.com/en/portfolio/index.html

Note 1: Population growth rate from 2005 to 2010 within a 1 km radius of properties acquired in connection with 2 nd PO
Note 2: Ratio of properties within 30 minutes from the nearest station to major stations among 8 properties in connection with 2nd PO by acquisition price18

External growth

Properties acquired in connection with 2nd PO
Total acquisition price

JPY

Total appraisal value

28.6 bn

JPY
Acquisition
price (JPY)

Properties

29.7 bn

Appraisal
value
(JPY)

Appraisal
NOI yield

Location

Average appraisal
NOI yield# of properties

Acquisitions from
Sponsor and Alliance
Companies

Acquisitions from AssetManager's network

5.2%

8

4／8

4／8

Core tenantAcquisition
channels

Properties

T-15

O-10

Nakamachidai
Tokyu StoreMillion Town Tsukaguchi(Land)

NSC

3,360 mn 3,780 mn

Tokyometropolitan
5.4%
area
(18 min to
Yokohama)

Tokyu Store
Corporation

Asset
Manager's
network

NSC

T-16

N-4

Central Wellness Club
Nagatsuta Minamidai

Homecenter Kohnan
Sunadabashi

SS

1,724 mn 1,880 mn

Tokyometropolitan
5.7%
area
(29 min to
Shibuya)

1,450 mn 1,500 mn

Tokyo
metropolitan
4.5%
area
(12 min toTokyo)

CentralSports Co.,
Ltd.

Asset
Manager's
network

T-17

SS

Appraisal
value
(JPY)

Appraisal
NOI yield

3,723 mn 3,730 mn

4.6%

7,140 mn 7,220 mn

Greater
KohnanNagoya area
5.2%
Shoji Co.,
(24 min to
Ltd.
Nagoya)Sponsor

5,720 mn 5,740 mn

Ordinancedesignated5.0%
cities(3 min to
Sendai)

OtsukaKagu, Ltd.

Sponsor

4,010 mn 4,230 mn

Ordinance5.7% designatedcities

Kyorindo
Co., Ltd.

Asset
Manager's
network

Acquisition
price (JPY)

LocationCore tenantAcquisition
channels

Greater
Osaka area Mandai Co., Alliance(13 min to
Ltd.
Companies
Osaka)

R-7

Life Kameido
SM

Solala Plaza
Life
Corporation

Urban
Station-Front

Sponsor

O-9

R-8

Nishi-Tengachaya(Acquired in Jan. 2016)

P-1 Plaza Tenno

SM1,505 mn 1,620 mn

5.2%

Greater
Osaka area
(16 min to
Osaka)

Life
Corporation

Asset
Manager's
network

NSC

19

External growth

Selective acquisition and pipeline
Sponsor pipeline• Capitalize on acquisition opportunities
through the Kenedix Group platform

Examples of
Variousacquisition
methods inconnection
with 2nd PO• The 4th property acquisition originated by
Nippon Commercial Development• Leverage the warehousing function of
Sumitomo Mitsui Finance and Leasing

Asset Manager's network• Acquire properties through direct
negotiations and leveraging the AssetManager's own proprietary network

Acquisition

Acquisition

Provides solutions
for disposition ofproperties

Alliance Company pipeline

Life Kameido

Acquisition

Million Town
Tsukaguchi (Land)

Leverage the AssetManager's own
proprietary network

SellerSponsor intend to develop shopping centerfor daily needs

SellerExamples of properties owned by our Alliance Companies

Royal Home Center
Totsuka-Fukaya (Land)
Location: Yokohama,
Kanagawa

Example ofpipeline forpotential
acquisition
opportunities

SS

The drawings above do not indicate the number of properties or appearanceof properties under development.

Life
Nishi-Tengachaya

Yorkmart TotsukaFukayacho (Land)
Location: Yokohama,
Kanagawa

Unicus Urawamisono
Location: Saitama, Saitama
SM

NSC

These are the properties the underlying land of which are owned by Alliance Companies, and confirmed by both the Alliance Companies and Kenedix Retail
REIT as the properties that meet our investment criteria. As of May 20, 2016, we have no plans to acquire these properties and there is no guarantee that we
can acquire these properties in the future. We may acquire only the underlying land of these properties. The illustration of Unicus Urawamisono above is acompletion image based on design drawings and may differ from the actual building after completion.

20

External growth

Our growth roadmap
AUM(Note)

PurposeAchieve steady DPU growth
Enhance portfolio stability
Improve in liquidity of investment units

Target AUM of JPY200.0 bn
within 3 years after the listing

2,000億円
JPY
200.0 bn

1,587億円
JPY
158.7 bn
1,316億円
JPY
131.6 bn

808億円
JPY
80.8 bnAtlisting
上場時

918億円
JPY
91.8 bn

End of
第1期末
1st fiscal period

Annual acquisition
target of JPY 40 bn

End of
第2期末
2nd fiscal period

Abundant external growth opportunities Size of acquisition universe
 Increasing proportion of our investment target among
domestic retail facilities
Note:

After第2回PO後
the acquisition inconnection with 2nd PO

Within 3 years
上場後3年以内
after listing

Promotion of external growth strategies
 Solid pipelines from sponsor and alliance companies Diverse acquisition routes and methods
 Selective investments by professionals"AUM" represents the total acquisition price of all properties in the portfolio.

21Section 3-2

Implementation of growth strategies(Internal growth/Financial strategies)

Internal growth

Active management strategies
Value added "one-stop" asset management and property management services
Value added "one-stop" asset management and property management services

Asset management services

Property management services

Strengthened collaboration

Build and manage a stable/consistent portfolio

Interact directly with tenants

Monitoroperational
status of tenants

Accumulate knowhow
Executesolutions

Identify
issuesEnhance tenantsatisfaction

Seek internal growth through property management
Building expansion leveraging
unused portions of floor area

Optimization of tenant composition

Sales-linked rent

Effective utilization of CAPEXExpected effects of active management strategies

Earnings stability

Enhancement in profitability

Increase in asset value

23

Internal growth

Enhance profitability and asset value by property expansion
Criteria for building expansion
Synergies
generatedwith existing
tenants

Unusedportions offloor area

Profitabilityof theproperty
expansion

Effects ofexpansion on
financialconditions

Completed property expansion of Roseo Mito (completed in Nov. 2015)
Highlight of the property expansion

NOI yield (ROI)NOI yield (ROI) is calculated by NOI (deducting assumed annual
operating expenses (excluding depreciation) from assumed annual
operating revenue of the New building) divided by construction cost

11%

Summary of the property expansion
Before the property
expansion

Potential expansion projects

Expertise of the Sponsor and Alliance Companies
in retail facilities

After the property
expansion

Total leasable area

45,654.67 m2

2,641.48 m2

48,296.15 m2

Acquisition price

JPY9,675 mn

JPY371 mn

JPY10,046 mn

Appraisal value

JPY9,780 mn

JPY10,700 mn

Appraisal NOI

JPY554 mn

JPY595 mn

5.7％

5.9％

Appraisal NOI yield

Before the property expansion

New building

After the property expansion

After the opening

Expansion
site

24Internal growth

New!

Property expansion (restaurant building) planned at Unicus Ina
Overview of the property expansion

Aerial photograph

Improve profitability

Enhance asset value

12%+240 mn

NOI yield (return on investment)

Increase in Appraisal value

Calculated using the following formula:
Estimated increase in NOI (Estimated annual rent from the newrestaurant building - Estimated annual expenses excluding
depreciation) /Total construction cost

Difference between the appraisal value of Unicus Ina (as ofMarch 31, 2016) and its appraisal value assuming thecompletion of the property expansion, both of which are provided
by Japan Real Estate InstitutePlannedconstruction
site

Estimated increase in NOIAppraisal value

12.9 mn

4,660 mn
Total construction cost

Appraisal value

107 mn4,420 mn

Planned construction site

Plannedconstruction
site

（JPY）

Schedule (planned)(Note 1)

Rendering(Note 2)

Rendering(Note 2)

Late July, 2016:
Application for building approval

Mid-September, 2016:
Begin building construction

Mid-January, 2017:
Completion & delivery of building

Note 1: We cannot guarantee that the building extension will be completed as scheduled; the construction
may be cancelled or delayed in the future
Note 2: This rendering may differ from the actual building to be completed
Note 3: Please see for details “Notice Concerning Construction of a New Building (Property Expansion) at
Unicus Ina” dated May 19, 201625

Internal growth

Leasing overview
Rent type (fixed / sales-linked rent)

Rent revisions(based on number of revisions)(October 1, 2015 – March 31, 2016)

Based on actual rent (Oct. 2015‐Mar. 2016)
Fixed rent
withSales-linked rent
13.1%

Sales-linked rent
5.3%

Weight of multi-tenant properties(based on acquisition prices)

Total Sales-linked rent

フルルガーデン八千代
FululuGarden Yachiyo
9.4%

6.2%

Blumer HAT Kobe
ブルメールHAT神戸
6.9%
Downward
revision
13.5%

Upwardrevision
24.3%

ロゼオ水戸
Roseo
Mito
6.3%

Rent
increasedorunchanged

Other
その他
43.9%

multi-tenant
properties

86.5%
No
revision
62.2%

Fixed rent
81.6%

Remaining lease term (by annual fixed rent)
15 to Less
than
15年以上
10
years
20年未満
9.8%

20 yearsor more20年以上
6.1%

BlumerMaitamonブルメール舞多聞
5.3%

56.1%

CarinoEsaka
カリーノ江坂4.1%
Passaggio
Nishiarai
パサージオ西新井
3.7%
Daikanyama
Address Dixsept
代官山アドレス・ディセ
3.4%

Other multi-tenant
properties
その他マルチテナント
11.9%

Lease contract type (by annual fixed rent)

MONA
Shin-Urayasu
MONA新浦安
5.1%

Lease expiry (by annual fixed rent)# of tenants and % of lease expiry in each period(Note 1)

Less than
2 years
2年未満
17.7%

Commercial fixed-term
land
lease
定期借地
13.3%

2 to Less
2年以上
than
5 years
5年未満
13.6%

10 to Less
10年以上
than
15年未満
15
years
27.1%

Other
その他
0.0%

Note 1: The figures are as of March 31, 2016 for the 40 properties acquired by the date of this material.

26

9

93

34

12

tenants

tenants

tenants

tenants

tenants

Regularbuilding
lease
普通借家
20.0%

6.7%

Fixed-termbuilding
lease
定期借家
66.7%
5 to5年以上
Less than
10年未満
10
years
25.6%

22
tenants

1.9%

2.4%

2.2%

1.1%
3rd period 4th period

第3期(ending

第4期(ending

5th period

第5期(ending

6th period

第6期(ending

7th period

第7期(ending

Sep. 2016) Mar. 2017) Sep. 2017) Mar. 2018) Sep. 2018)
Note 1: Based on the contractual rent determined in the lease contract,
including regular building leases.

1.6%

8th period

第8期(endingMar. 2019)26

Internal growth

E-commerce resistance
Percentage of tenants with e-commerce resistant business(by annual fixed rent)

Percentage of tenants' category (based on rents)
Others13.2%

Tenants that are thought to obtain high needs forcustomers to visit their physical retail stores

Grocery
22.5%

Sports club
3.6%
Restaurants
3.8%
Interior goods
4.0%
GMS
6.1%

a:Businesses difficult to replace by
e-commerce(Note 1)

17.6%

Other retailer
13.5%

Consumerelectronics
6.4%
Clothing
6.8%

Service
10.1%Home & garden
9.9%

Consumers' preference: physical stores VS. online shoppingb:Businesses where customers show
preference for purchasing products at
physical stores(Note 2)

91.1%

c: Master lessees whose sub-lessees
primarily operate businesses fallingunder category a and b

51.0%

12.8%

Grocery
食品
Medicine
薬
Lifestyle
goods
雑貨/日用品Mobilephone
携帯電話
Petペット用品
care goods
Largefurniture
大型家具
Large home大型家電
appliances
Clothing
衣類
Smallfurniture
小型家具
Cosmetics
化粧品
Train切符/チケット
tickets / tickets
Personal computer
PC

Purchased more frequently…
実店舗が多いAt physical storesOn
インターネットが多い
the internet

Small home小型家電
appliancesBooks
本CD / DVD/ BD and others
CD/DVD/BD類

d:Businesses that require physical visits tostores or handle products that
consumers highly desire to evaluate inperson(Note 3)

0%

8.9%

Note 1: "a" refers to businesses including medical services, hair salons, photography studios, for-profit schools and study centers,
leisure facilities, restaurants and health clubs that cannot be replaced by e-commerce.
Note 2: “b” refers to businesses where 50% or more of the respondents to the survey conducted by the Ministry of Internal Affairs andCommunications titled “Product types for online shopping or physical stores” indicated their preference for purchasing
products at a physical store and where 15% or fewer indicated their preference for purchasing such products on the internet.
“c” refers to P&D Consulting Co., Ltd. and Daiwa Royal Co., Ltd, whose main sub-lessees fall under category “a” or “b”.
Note 3: “d” refers to businesses that require physical visits to stores or handle products that consumers highly desire to evaluate inperson (sporting goods, prescription eyewear, second-hand products, shoes, musical instruments and interior products).

20%

40%

60%

80%

100%

Source: WHITE PAPER Information and Communications in Japan by
Ministry of Internal Affairs and Communications

Low % of online shopping attributed to total expenditure on
groceries

0.6%

Source: "National Survey of Family Income and Expenditure 2014" by Ministry ofInternal Affairs and Communications Bureau of Statistics

27

Internal growth

Effective utilization of CAPEX
Blumer HAT Kobe: Replacing floor materials, renewing signs and restrooms

Fululu Garden Yachiyo and Blumer HAT Kobe: Installation of LED lighting

Fululu Garden Yachiyo••

Blumer Maitamon: Replacing to wax-free floor materials (reducing BM cost)

Blumer HAT Kobe

Ashico Town Ashikaga: Installation of escalators for opening of cinemas

After

After

BeforeInstallation of LED lighting
to reduce utility cost andenvironmental load
Completed at Fululu
Garden Yachiyo andBlimer HAT Kobe, after
completion at Passagio
Nishiarai in 1st period

Before28

Internal growth

Operating highlights ~ Fululu Garden Yachiyo
CSC Community
Shopping Center

Fululu Garden Yachiyo

GMS vs. CSC

A CSC easily accessible by both cars and trains, located in an area withpopulation growthStand alone GMS fall outside
KRR's investment targets



CSC, consisted of specialty storesand GMS, is included as KRR's
investment targets

GMS

RSC larger than CSCs is also ourinvestment targets (up to 20% of
the entire portfolio)(excluded from our target)

Enlarged view
Yachiyo GC

CSC/ RSC
Synergetic
effect

GMS



GMS

文

文

Yachiyo Wide-area Park文
文

Murakami Station

Yachiyo Chuo

Specialty
shopping mall

(Our investment target)

Toyo Rapid Railway
Yachiyo City Office

Keisei Main Line
Shizu
Katsutadai
Keisei Owada
Yukarigaoka
Takanodai CC

Tenants' credibility

Fululu Garden Yachiyo

Toyo Katsutadai Station

Yachiyodai

Katsutadai Station
文

Sales

Net income

JPY14,848 mn

Xebio HD

210,672

2,084

Yachiyo, Chiba

Fast Retailing

1,681,781

110,027

GFA(1) 50,960.84 m2(2) 65,698.32 m2

Aoki HD

183,805

10,185

Core tenant

Ito-Yokado Co., Ltd.

Honeys59,020

1,948

Appraisal NOI

JPY760 mn

Regal Corporation

36,030

1,336

Source: Compiled based on each company's disclosure materials
Note: Legal status suffixes, such as Co., Ltd., are omitted

5.1%

Ito-Yokado
Access

About 45 minutes to "Otemachi" stationfrom the nearest "Murakami" station

Facing National Route 16

Shuttle bus service available from
"Katsutadai" station1



Ito-Yokado building



4,786

6,038

6,045

250

4,991
172

Within a 3km radius: 160,000 people(up 2.3% from 2005 to 2010)

1,000

50

0

0

Competitive environment

Number of visitors
Stable at 600,000 per month on average

Ranks in top 30% of all Ito-Yokado stores interms of annual sales

Sales have been growing since the store
manager was given more authority and the
product mix was optimized to better meet theneeds of local area customers



Low occupancy cost ratio: approx. 5%(Occupancy cost ratio: rents divided by sales)

200
175

3,000

GMS "Izumiya" on the north of the"Murakami" station will close in early June

300

Within a 5km radius: 335,000 people(up 1.5% from 2005 to 2010)





5,631

6,000
5,000

Net income (JPY bn)
当期純利益

営業収益
EBIT

(JPY bn)
7,000

Operating performance of Ito-Yokado Yachiyo

4,000

Yachiyo City: 195,000 people(up 3.3% from 2010 to 2015)

National Route 16

Seven & i HD

Population

Specialty store building

Source: Aerial photographs Geospatial Information Authority of Japan

Company nameLocation

Local & retail trade area

2

(JPY mn)

Nearly 85% of the tenants are listedcompanies or members of listed corporategroups (on a rent income basis)

Acquisition priceAppraisal NOI
yield

Murakami Station

Performance of core tenants (listed companies)

129

160

138

150
100

2,000

2011

2012

2013

2014

2015

Seven & i HD group companies in the property


Ito-Yokado: Core tenantAkachan Honpo: Tenant in the specialty store
buildingMall SC Development: Sub-PM for the entire
property

Online supermarket
Operating an online supermarket where products
ordered online are delivered to customers fromthe Ito-Yokado store in this property

Customers can also receive products theyordered online at any of the 10 Seven Elevenshops in the neighborhood

Ito-Yokado is reported to represent nearly half ofthe entire online supermarket market, which size
is approx. JPY100 bn

29Internal growth

Operating highlights ~ MONA Shin-Urayasu
Urban Station-Front

Growth opportunities

MONA Shin-Urayasu

Retail trade area

文

文

Shin-Urayasu Station
文

MONA Shin-Urayasu

140

文
文

Location
Land area(Note)

130.4

文

文

100
60

Urayasu, Chiba

40

15,875.86 m2(Note)

GFA

76,767.24 m

Core tenant

Undisclosed

Appraisal NOI

JPY495 mn

Appraisal NOI yield

6.1%

2

120

80

JPY8,063 mn

110.1
110

20

浦安市
千葉市
Chiba-shi
Urayasu-shi
1990

1995

2000

2005

2010

2015

Source: 2015 National Census (preliminary report) (Ministry ofInternal Affairs and Communications)

Growth potential

MONA
Shin-Urayasu
NBF Shin-Urayasu
Tower

Source: Survey of Taxation for each City/Town/Village by
Ministry of Internal Affairs and Communications (2015)

Tenants include retailers offering convenience
goods, including a grocery supermarket and adrugstoreProvided with highly useful public spaces which canbe used for various events

Financial institution tenants (6 tenants), which help
attract heavy traffic into the property

Restaurant tenants can drive demand from office
workers on their way home as well as travelers
staying in hotels close to the train station

A 100-yen shop, a drugstore and sundries storesthat are highly popular among foreigners help attract
demand from inbound tourists



About 20 minutes to "Tokyo" station from thenearest "Shin-Urayasu" station



The property is connected directly to the station
via a pedestrian walkway

Shin-Urayasu station has a daily passenger trafficof over 58,000 people on averageTokyo Disney Report is located in Maihama, one
station west of Shin-Urayasu station

Within a 5km radius: 509,000 people(up 3.9% from 2005 to 2010)



Within a 3km radius: 205,000 people(up 5.3% from 2005 to 2010)

60.2%



Urayasu City: 164,000 people(down 0.5% from 2010 to 2015)

Proportion of the tenants whose
fixed-term lease contracts will
mature by the 6th financial
period (ending March 2018)



AEON Shin-Urayasu (Shoppers Plaza ShinUrayasu) is located on the south-east of “ShinUrayasu” station

Inboundtourists

Population

Competitive environment

Source: Aerial photographs Geospatial Information Authority of Japan

Tokyo
東京都
metropolis
Localresidents
Officeworkers

Pedestrian walkway

AEON
Shin-Urayasu

Tokyo
Chiba
千葉県
東京23区
23 wards
prefecture

Tenants meeting the needs of broad customer baseAccess

JR Shin-Urayasu Station

104.2

100

0

Location & retail trade area

Oriental HotelTokyo Bay

137.4

130

Note: Although the property is subject to sectional ownership, thetotal land area and GFA for the entire building are stated

Urayasu Brighton
Hotel Tokyo Bay

140.6
140

132

文

Meikai University

Acquisition price

120

115

123

Higher average income(National average=100)
150

160

文

Juntendo University
Urayasu Hospital

Retail trade area

 The average income in Urayasu City exceeds that in
23 wards of Tokyo

 Population in Urayasu City, where the property is
located, had grown until 2010 and has remained
stable level since then
180
164
164
155

文

文

Steadily growing population

文

Urayasu IC

Urayasu City OfficeLeasing maturity

We seek to achieve cost saving
and improved tenant satisfaction
through effective utilization of
CAPEX in a timely manner upon
the maturity of each lease
contract, and pursue rental upside
upon contract renewal or tenant
replacement by optimizing our
tenant mix to better meet theneeds in the retail trade area30

Internal growth

CSR and environmental initiatives
 We proactively participate in local-community-enlivening activities and take environmental initiatives
Establishment of “Environmental Policies”■Environmental Policies
The officers and employees of Kenedix Real Estate Fund Management, Inc. ("KFM") will
undertake investment management operations in accordance with the following environmental
policies.
1. Compliance with Environmental Laws and Regulations
KFM will promote environment-friendly investment management operations by adhering toenvironmental laws and regulations.
2. Promotion of Energy Conservation Measures
KFM will systematically advance energy conservation measures at its managed properties,
maintaining a strong awareness of the importance of natural and energy resources.
3. Reduction of Environmental Burden
KFM will undertake initiatives to reduce CO2 and waste emissions as well as promote recycling
at its managed properties, underscoring its commitment to alleviating its environmental burden.
In addition, KFM will take sufficient care when handling harmful substances and environmental
pollutants.
4. Disclosure of Environmental Information
KFM will work to disclose necessary information to a variety of concerned parties, including
investors, tenants and business partners, in such areas as its environmental policies andmeasures.
5. Environmental Education
KFM will take steps to improve the environmental consciousness of its officers and employees
through internal education.

Environmental initiatives
We utilized CAPEX to reduce
environmental load such as
installation of LED lighting

The following properties have been awarded the “DBJ Green
Building Certification” for their environmental initiatives

T-1 Fululu Garden Yachiyo
T-2 MONA Shin-Urayasu

We agreed to provide part ofUnicus Yoshikawa as a temporary
gathering area in cases of disastersuch as floods

Passaggio Nishiarai

Signing of agreement
Blumer HAT Kobe

Fululu Garden Yachiyo

Rating on our environmental initiatives

CSR initiatives

Unicus Yoshikawa (aerial photo)

Help enliven local communities
We seek to enhance the medium to long term asset value of our retailproperties by attracting tenants engaged in service businesses andholding local events at our properties to enliven the local community

O-1 Blumer Maitamon
T-5

Unicus Ina

T-7

Unicus Yoshikawa
Yoshikawa Marche(Unicus Yoshikawa)

Roseo Festival(Roseo Mito)

31

Financial Strategy

Financial highlights
Breakdown of debt outstanding by lender(After prepayment on May 31, 2016)

Summary of interest-bearing debt
 Conducted debt financing with consideration of the balance between borrowing costs and maturities Realized steady growth while maintaining financial health through adequate management of LTV
 Extended maturities and increased the proportion of fixed-interest debt
At listing

1st period

2nd period(Feb. 10, 2015)(Sep. 30, 2015)(Mar. 31, 2016)

New loans (Note1)

Post 2nd PO(May 31, 2016)

Total debt outstanding(JPY mn)

28,172.5

38,350.0

57,500.0

11,800.0

69,300.0

Long-term debt ratio

88.2%

94.8%

88.7%

52.8%

82.6%

Fixed-interest debt ratio

88.2%

94.8%

88.7%

52.8%

82.6%

Average debt cost(Note2)

---

1.07%

1.05%

---

1.01%

Average years to debt
repayment dates

5.0 years

5.5 years

5.1 years

4.8 years

4.9 years

11

11

11

5

11

Number of lenders

---

LTV

40.6%

42.7%

The Bank ofTokyo-Mitsubishi
UFJ, Ltd.
13.3%

---

Development Bankof Japan Inc.
10.1%
Sumitomo Mitsui
Banking
Corporation
47.6%

7,000

7,000

7,000

7,000

The Gunma
Bank,Ltd.
0.6%
The Musashino
Bank,Ltd.
1.4%

Mitsubishi UFJ
Trust and Banking
Corporation
2.4%

Resona Bank, Ltd.
4.5%
Mizuho Trust &Banking Co.,Ltd.
3.1%
Aozora Bank, Ltd.
3.0%

Total amount of security/guarantee deposits
JPY10.6bn(as of Mar. 31, 2016)
JPY7.1bn(Amount kept as cash for deposit repayment)

7,000
6,500

5,650

5,570

6,000

Sumitomo Mitsui
Trust Bank, Ltd.
7.0%

Optimum use of security/guarantee deposits

8,000
6,500

69,300Mizuho Bank, Ltd.
7.0%

42.5%

(JPY mn)

7,000

JPY

mn

Note 1: New debt excludes the amount of 800 million yen that is anticipated to be prepaid on May 31, 2016.
Note 2: "Average debt cost" is calculated as the weighted average interest of debt with upfront cost included, based on the amount outstanding. For variable-interest debt, thedebt cost is calculated using the interest rate fixed through interest swap. In the case that there is no interest swap, TIBOR rate for each specific date above is adaptedin the calculation.

Staggered maturities of interest-bearing debts (After prepayment on May 31, 2016)

Debt
outstanding

Post 2nd PO

5,000
3,850

4,000

(Amount kept as cash for deposit repayment)
2,670

3,000

2,000

Rating（JCR）

1,340

1,330

890

1,000

(Long-term issuer rating as of Mar. 31, 2016)

Japan Credit Rating Agency, Ltd. (JCR)

0
4th
4期

Period5th
5期

Period6th
6期

Period7th
7期

Period8th
8期

Period

9th 10期
10th 11期
11th 12期
12th 13期
13th 14期
14th 15期
15th 16期
16th 17期
17th 18期
18th 19期
19th 20期
20th 21期
21st 22期
22nd 23期
23rd
9期

PeriodJPY11.7bn
JPY8.1bn

PeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodPeriodA

Period32

Disclaimer
The contents in this document are provided solely for informational purposes and not intended for the purpose ofsoliciting investment in, or as a recommendation to purchase or sell, any specific products.
This document contains charts/diagrams/tables/data and others Kenedix Real Estate Fund Management (" KFM")
created based on data, indices, etc. published by third parties, in addition to the information related to Kenedix Retail
REIT Corporation (“KRR"). This document also contains the current analyses/judgments/other opinions of KFM.
KFM is a financial instruments business operator under the Financial Instruments and Exchange Act.
The information provided herein is unaudited and hence no assurance or warranties are given with respect to theaccuracy or completeness thereof. Also, please be aware that the analyses/judgments/other opinions provided by KFM
may change or cease to exist without prior notice of any kind as they are based on current assumptions and beliefs of
KFM.
Neither KRR nor KFM shall be liable for any errors/inaccuracies of the data/indices/other information published by third
parties (including the data based on the appraisal report).
This document also contains forward-looking statements and anticipation of future results for KRR. However, noguarantees are given with respect to the accuracy of these statements/anticipation.
Revised editions of this document will be posted on our website (http://www.krr-reit.com/en) should there be majorcorrections going forward.
Unless otherwise explicitly stated, the figures such as percentage, ratio, and year(s) are rounded off to largest decimal
place shown in this document, the amount of money such as JPY, Japanese Yen, is truncated at the one tenth of thenumber shown in this document.
33