SEMI-ANNUAL REPOR
for the 15th Period
From February 1, 2019 to July 31, 2019

Kenedix Residential Next Investment Corporation

1

Ⅰ Overview of KDR

To our unitholders
We are pleased to inform you that Kenedix Residential Next Investment Corporation(KDR) successfully closed all accounts for the 15th fiscal period (from February 1,
2019 to July 31, 2019). We would like to thank all of our unitholders andstakeholders for their continued support and cooperation. We hereby report on theasset management overview and results for the 15th Fiscal Period.
During the 15th fiscal period, operating revenue was ¥8,136 million, operating
income was ¥4,358 million, ordinary income was ¥3,741 million and net income was¥3,741 million. The distribution to unitholders was ¥4,063 per unit, +0.59% higher
than in the previous period.
In the 15th fiscal period, KDR procured funds in February 2019 through public
offering for two consecutive periods and acquired 3 residential properties and 3
healthcare facilities in Tokyo, as well as sold 1 residential property in Osaka City using
the funds combined with borrowings and cash on hand.
For our properties, the occupancy rate of the portfolio at the end of the fiscal period
remained high at 97.5%. For residential facilities, with the continuing favorable
market environment, rents have risen mainly in the Tokyo metropolitan area, andprofitability was greatly improved. Meanwhile, for healthcare facilities, long-termlease contracts contributed to maintaining the stability of the portfolio.
As to our activities in the 15th fiscal period onward, we acquired 1 rental residential
property on September 17, 2019, and plan to acquire 2 rental residential properties
by March 2020.
As a result, as of September 31, 2019, we own assets totaling 144 properties valuedat ¥ 234.2 billion (total acquisition price).
Based on an accurate understanding of social and economic changes, we will pursue
with flexibility investment and revenue opportunities that we believe are the most
attractive. We will dynamically invest and manage our portfolio by gathering
information and making decisions swiftly. By using this approach, we aim to
maximize the unitholder’s value.
Your continued support and cooperation are highly appreciated.

Executive Director,
Kenedix Residential Next Investment Corporation
Director & COO, Head of Residential REIT Department,
Kenedix Real Estate Fund management, Inc.

2

Financial Highlights

Distribution per Unit
(Note) Distribution per unit for 16th fiscal
period and 17th fiscal period is estimated basedon certain assumptions as of September 12,
2019

15th (Ended July 2019) Actual

4,063 yen

16th (Ending January 2020) Forecast

4,064 yen

17th (Ending July 2020) Forecast

4,065 yen

Trend in DPU
（yen）
5,000

4,026yen

4,039yen

4, 063yen

4,064yen

4,065yen

4,000

3,473yen
3,116yen

3,123yen

3,115yenJan.2015（6th Period）

Jul. 2 0 1 5(7th Period)

Jan.2016（8th Period）

3,180yen

3,266yen

3,316yen

3,000

0Jul. 2 0 1 6(9th Period)

Jul.2020
Jan.2020
Jul. 2 0 1 9
Jan.2019
Jan.2018
Jul. 2 0 1 8（12th Period） (13th Period) （14th Period） (15th Period) （16th Period） （17th Period）(Forecast)(Forecast)Jan.2017
Jul. 2 0 1 7（10th Period） (11th Period)(Note) KDR implemented a two-for-one split of the investment units as of the record date of February 28, 2018 (Effective date on March 1,
2018). Before the period ended January 2018 (12th fiscal period), the figures for the distribution per unit are those taking into account the
spilt of the investment units.

Operating Revenues(million yen)

Operating Income(million yen)ordinary income(million yen)

Net Income(million yen)

15th Fiscal Period

8,136

4,358

3,741

3,741

14th Fiscal Period

7,823

4,213

3,599

3,598

Operating Highlight2,332

mln yenOccupancy rate
(At the end of 15th
Fiscal Period end)

Residential
Facilities

1,773

mln yenResidential
Facilities

properties

Healthcare
Facilities

mln yenHealthcare
Facilities

property

Other

541
17

Total Number ofproperties

143

properties

Residential
Facilities

118

properties

Healthcare
Facilities

24
1

Other

Total Acquisition
price

97.5
96.4
100.0

%

%
%

mln yen3

Management Message

Aiming to Achieve
Stability and Growththrough Residential
Facilities and
Healthcare Facilities
Director & COO, Head of Residential REIT Department,
Kenedix Real Estate Fund management, Inc.

Keisuke Sato
Kenedix Residential Next Investment Corporation (KDR)'s main

This is attributable to several factors. On the side of demand, Japan's

investment targets are residential facilities such as rental housing, or

population has been declining since peaking in 2008. In major cities,"spaces where people live and stay," healthcare facilities such as nursing

however, the population is increasing due to continuous population inflow

homes, and accommodations such as hotels. By investing in these threeparticularly in city centers. People gather in major cities for employment andasset classes, KDR aims to achieve stable earnings and sustainable

schooling purposes, and they gather more in central areas for greater

growth.

convenience. In recent years, in particular, more and more women are

Focusing on the growth potential of earnings from rental▲

actively participating in society, and more and more well-off households canhousing with further increase in rents

capitalize on opportunities to live near their workplaces with dual income.

Rental housing, which is the core of KDR's portfolio, is an asset withstable earnings because the rents of residential properties are lessvolatile than those of offices and commercial facilities, etc. and because
tenants are diversified. Especially during economic downturn, the range
of decline in rents is relatively narrow, and this defensive characteristic
has been favored in the field of real estate investment andmanagement. More recently, however, attention is being paid to thegrowth potential of revenue stemming from the rise in residential
rents, in addition to these defensive characteristics. The figure shows
the rate of increase or decrease in new rents at the time of rental
housing tenant replacement at KDR, indicating a positive for the

Furthermore, there is a tendency among young people not to own homes,
and these changes in lifestyles are expected to further boost demand forrental housing. On the other hand, the supply of residential property has
been restricted compared with the level seen before the global financial
crisis. Especially in the center of Tokyo, there is a large gap between the rentof rental housing and the rent of offices or hotels. Therefore, even if there island for development, the priority for housing development is not high, andthe supply of housing does not increase. Compared with the supply of rental
apartment buildings in the 23 wards of Tokyo over the past few years andnet inflow of residents (Chart.2), it can be seen that the net inflow ofresidents greatly exceeds the supply of rental apartment buildings.

seventh consecutive fiscal year (new rents have increased), and the rateof increase has been rising recently in particular (Chart.1).

Chart2Chart 1 Percentage of Increase/Decline of rent of Renewal tenants（％）

All Area

4.0

Other Regional Areas

Tokyo
Metropolitan
Area

3.6

2.1
2.0

1.5
0.9

1.0

-1.0
-2.0

Construction of rental apartments and net inflow
of residents■ Construction of rental apartment

80,00060,000Net inflow
of residents

Tokyo 23 wards

2.7

3.0

0

( uni t or
per sons)

1.3

0.9

0.5
0.1

0.4

20,000

0.3

0.4

2018
Jul.

2019
Jan.

0

-0.3

-1.3

-1.7
2016
Jan.

2016
Jul.

2017
Jan.

40,000

1.1

0.7

-0.3
-0.9

2.0
1.4

1.1
-0.2

2.6

2017
Jul.

2018
Jan.

2019
Jul.

Source ： Ministry of land, Infrastructure, Transport and Tourism. Statistics for
the Construction of New Housing. Ministry of Internal Affairs andCommunications. Report on Population Movement based on the Basic
Resident Register

4

In Tokyo, where the share of rental housing in the housing market is greater

We believe that there is considerable room to expand the size of thethan that of owner-occupied housing, the supply-demand balance of rental

market for healthcare facilities for J-REIT investment given that supplies forhousing is considered to be favorable even when considering the supply ofhealthcare facilities will increase and liquidation will progress. In addition,

condominiums and detached houses. We believe that the favorable business

we believe that we can contribute to the creation of a higher-quality

climate environment for rental housing in major cities will continue for somehealthcare facilities market by promoting the division of roles, in whichtime in the future in terms of both supply and demand. Rental housing has

real estate investment professionals like ourselves own facilities andtraditionally been regarded as defensive, but for the time being, in addition

manage them optimally over the long term, while operators focus on theto its defensive nature, it can be said to be an asset class that can enjoy anoperation of the facilities.

improvement in profitability due to the rise in rents.

As for the profitability of individual properties, healthcare facilities typicallyenter into long-term fixed-rent lease agreements with operators operating▲

Expansion of Healthcare Facilities Markets and Long-Term Stableprivate senior homes with nursing care and other properties. The averageremaining term of the lease agreement at the end of July 2019 was 16.8

Earnings

years for the facilities owned by KDR. By concluding long-term leaseAs you know, Japan's population is rapidly aging. The aging rate
(percentage aged 65 and over among the total population) is 26.6% (asof 2015), the highest in the world, and is estimated to be close to 40%
by 2065 as further population aging is forecast.
It is an urgent task for Japan to respond to the increase in demand for
medical care, nursing care and welfare caused by the aging of society.
In response to this challenge, KDR aims to contribute to resolving

healthcare facilities markets and consequently providing society withmore quality healthcare facilities. The "Basic Plan for Housing and
Living" of the Ministry of Land, Infrastructure, Transport and Tourism
sets a target elderly-housing-to-elderly-population ratio of 4% by 2025
in order to realize a living in which the elderly can live on their own.
Since elderly population in 2025 is estimated to be approximately
36,770,000 (Note 1), in order to achieve the target, approximately
1,470,000 elderly housing units will be required. As of 2017, however,the number of elderly housing units is approximately 900,000 (Note 2), so
it can be said that facilities still need to be supplied. In addition, thefact is that there are still few cases of such housing for the elderly
being securitized. Many individuals and corporations that have built
residences for the elderly to make effective use of their own land andoperators of facilities own the properties, and it is not an exaggeration
to say that there are very few cases in which real estate operators
specializing in real estate management, such as J-REITs, own properties(Chart.3).

short-term changes in the economy or business conditions, and healthcare
facilities serve as a foundation for stable revenue. On the other hand, for
operators, we believe that focusing exclusively on facility management
based on stable long-term lease contracts will lead to improvement in thequality of facility services, which in turn will lead to improvement in facility
evaluation and value of the real estate.

▲issues which the aging society faces by linking capital markets withagreements, KDR can expect stable rent revenue without being affected by

Achieving Stability and Growth
As described above, residential facilities have growth potential of
earnings due to rent increase in addition to their inherent stablefeature of earnings and healthcare facilities have the expansion
potential of the market in addition to stable earnings from long-term
fixed rents. KDR’s portfolio consists of such highly attractive assets that
ensure both stability and growth. In addition, although KDR has yet toinvest in hotels and other accommodations which are the other major
investment target, we have a policy of investing in properties for whichlease contracts with fixed rents are mainly concluded with operators
who operate hotels and other properties in the future. We therefore
expect that these properties will become a stable earnings base for our
portfolio in the same way as healthcare facilities.
Furthermore, as announced on September 12, 2019, the AssetManagement Company of KDR has recently revised its investment
guidelines to add childcare facilities to its follow-on investment targets.
Childcare facilities are highly important social assets from theperspective of measures to combat the declining birthrate and are

Chart3 Real Estate Owned by J-REITs and Private REITs（May 2019）

Healthcare
0.8%Therefore, we believe that investments in childcare facilities will further

Approx.¥ 174.4 bln

Logistics
15.4%

expected to generate stable earnings backed by solid demand.

Hotel
6.7%

Other
1.9%

raise the stable earnings base of KDR's portfolio.
In this way, we aim to become a REIT that achieves sustainable growthby building a portfolio that accurately captures changes in social and15.4 %

Total
Approx. ¥21 trn

Office
42.6%(Ｊ-REIT markets)
住宅
Residential
15.4%

15.4 %
商業
Retail17.1%

17.1 %

Source:“ARES J REIT Databook, etc.” The Association for Real
Estate Securitization

economic structures, in addition to the inherent stability in earnings ofeach asset type.
(Note 1) The National Institute of Population and Social Security Research“Population Projections for Japan (2017)”(Note 2) Based on the "Current Status of Serviced senior housing (March 8,2019)" by the Housing Assurance Promotion Division, Housing Bureau,
Ministry of Land, Infrastructure, Transport and Tourism, the "Privatesenior homes with nursing care, Housing for the Elderly with Services,
Nursing Homes for the Elderly, and Expense Homes for the Elderly"5Sustainability
Initiatives for Environment
Certification for healthcare assets★：New（Jan. 2019）

DBJ Green Building Certification(1)▼▼Certification for residential assets

BELS Certification◆：Renewed（Jul. 2019）7 residential properties are certificated.

KDX Residence Hanzomon ◆KDX Residence Ebisu ◆Plaisant Grand Ota tamagawa

KDX Residence
Shukugawa Hills★

KDX Residence
YotsuyaAshiya RoyalHomes

KDX Residence
Toyosu▼▼Serenite Kobe
Motomachi★

「BELS(Building-Housing
Energy-efficiency
Labeling System) is the third-party certification
system to rate houses and buildings inaccordance with duty to make effort to label
energy saving performance in the Act on
Improving Energy Consumption Performance forArchitectural Structures.

Excellent Nishinomiya

GRESB Real Estate Assessment

Self-assessment based on CASBEE wascarried out in November 2015, andnotification was submitted to Nishinomiya
City.

The Investment Corporation participates in
GRESB Real Estate Assessment from 2016
and acquired “Green Star” rating in 2019.
(Rating is “2 Stars”)
GRESB (Global Real Estate Sustainability
Benchmark) is a benchmark to evaluatesustainability performance of private andlisted real estate portfolio, etc. fromenvironmental and social perspectives.

OthersReduction of the amount of Energy used

EnergyConsumption

Reduction Targets

FY2018(YoY change)

5 year/5% total inintensity

Rate of change-6.4%

The Asset Management Company has set long-term goals concerning
reduction of the amount of energy used and promotes initiatives
leading to reduction of environmental burden while continuously
monitoring its efforts.

Secure Lockers for Deliveries

CASBEE Certification

Comprehensive Assessment System for Built
Environment Efficiency (CASBEE) is amethod for evaluating and rating theenvironmental performance of buildings andthe built environment.
Note 1:“DBJ Green Building Certification” is a systemestablished by Development Bank of Japan in
April 2011 to support real estate that meetsenvironmental and social conditions.

LED Lights in Common Areas(2)Total(after 2015)
Property (props)

46

Expense (mln yen)

78.7

Annual reduction (mln yen)

22.5

Outlets for recharging electric cars
EV Point

112 props
Secure lockers for parcels eliminate the need fordelivery companies to return to a property when aresident is not home the first time. This reducestransportation CO2 emissions and wasted working
time for drivers. 。
Note 2:3 propsParking areas have outlets so that residents caneasily recharge electric cars.

“Annual reduction” is calculated based on the presentation materials from construction company as of exchanging construction.

6

Overview of Portfolio

Hokkaido

Percentage ofproperties
owned by area

7 props 3.4％

：Residential：Healthcare

Aomori,Akita

2 props 1.0％

Osaka metropolitan area

Total

Osaka,Kyoto,Hyogo,Shiga

146 props

30 props
23.3％

Miyagi4 props 1.4％

Fukuoka

6 props

Tokyo Metropolitan Area

4.2％

Tokyo, Kanagawa, Saitama, Chiba

90

Aichi

Hiroshima
1 prop 0.2％

props

6 props 4.1％ 62.3 ％Portfolio Breakdown
Residential Facilities

Healthcare Facilities

Room type

Other
0.7% (1 prop.)

FamilyStudio22.7%

21.5% (5 props.)

39.8%

Serviced senior
housing
2.5% (1 prop.)

22.7%(24 props.) Private senior homes

76.5%(121 props.)

Use

37.5%

7.2%

Other Tokyo
Metropolitan
Area

11.3% 2.5％

38.4%

Tokyo 23
Wards

21.8%

(14 props.)
Other
Regional Other
Areas
s

Tokyo
Central
8 Wards

8.0%

68.7%

(4 props.)

Entire Portfolio

Area
31.8%

Private senior homes(with nursing care)(residential)

Small Family

Other
Regional Areas

Facility typeNursing and healthfacilities

Tokyo
Metropolitan
Area

68.2%

Three Major
Metropolitan Area

Osaka
Metropolitan
Area

Area
Tokyo
Metropolitan
Area

41.3%

44.9%

86.1%

(Note) Including the ratio of the to-be acquired assets by March 2020, which are already scheduled for as of the date of this material.

7

Investment Unit Price
Investment Unit Price (After Announcement of the Merger) (1)KDR unit
price(in yen)

TSE REIT
index

TSE residential
REIT index

Jul.13 , 2018
Announcemen
t of the 4th PO

Nov.10, 2017
Announceme
nt of merger

Nov. 2017

Note 1:
Note 2:

Jan.2018(units)Sep.7 , 2018
Announcemen
t of inclusion
in index

Feb.4 , 2019
Announcemen
t of the 5th PO

Mar.1 , 2017
Completionof merger

Mar.2018

May.2018

Jul.2018

Sep.2018

Nov.2018

Jun.2019

Mar.2019

May.2019

Jul.2019

Aug.2019

KDR investment unit price and TSE Residential REIT index are based on the closing price. For the TSE Residential REIT index, an index basedon the November 10, 2017 closing prices of this index and KDR investment units is used.
KDR implemented a two-for-one split of the investment units as of the record date of February 28, 2018 (Effective date on March 1, 2018).
The above figures for the unit price before the split are those calculated by dividing the actual unit price by two.

Composition of Unitholders (based on number of units)
15th Fiscal period
907,458 units

8.9 %14th Fiscal period
869,133 units

10.0 %

64.7 %

69.0 %■ Security firms■ Individuals and others■ Foreign companies■Financial institutions■ Other domestic companies

19.3 %
16.0 %

3.4 %

3.7%

3.6 % 1.4%

8

Unitholders’ benefit programs

Seikatsu Kagaku Un-Ei Co., Ltd.
Benefits● Same-day facility site-visit (with lunch) free of charge

Eligible
PersonUnitholder and his / her spouses and his / her relatives (within
the second degree) ※A resident of the requested healthcare
facility and an use in conjunction with other discount system areineligible.

Facilities
Available

All of the private senior homes with nursing care operated
by Seikatsu Kagaku Un-Ei Co., Ltd. as of July 31,2019.

Sompo Care Inc.
Ⅰ. Sompo Care LAVIERE・≪On the condition of lump sum payment≫3% discount fromthe initial lump sum payment for resident・≪On the condition of monthly payment≫3% discount of theamount equivalent to the rent out of the monthly payment(Until the contract ends)
Benefits
Ⅱ. Sompo Care Sompo no ie, Sompo no ie S, Sompo no ie GH,
Private senior homes (residential), Serviced senior housing,Group homes
・3% discount of the amount equivalent to the rent out of themonthly payment or of the rent (Until the contract ends)

The No. of 27 facilities
Facilities
Area
Contact
No.

Tokyo, Saitama, Chiba, Kanagawa, Shizuoka, Aichi, Kyoto, Hyogo,
Osaka0120-580-731

N/A
Property
owned by KDR
Homepage

http://www.seikatsu-kagaku.co.jp/

CENTURY LIFE CORPORATION
Benefits● Same-day facility site-visit (with lunch) free of charge

Eligible
PersonUnitholder and his / her spouses and his / her relatives (within
the second degree)

Facilities
Available

All of the private senior homes with nursing care andserviced senior housing operated by CENTURY LIFE
CORPORATION as of July 31,2019.

The No. of 10 facilities
Facilities
Area

Tokyo, Saitama, Chiba, Kanagawa, Osaka

Contact
No.

+81-120-580-731

N/A
Property
owned by KDR
Homepage

Eligible
PersonFacilities
Available

Unitholder and his / her spouses and his / her relatives (within
the second degree)※A user who has inquired this benefit through agencies, aresident of the requested healthcare facility and an use inconjunction with other discount system are ineligible.
Ⅰ. Sompo Care LAVIERE operated by Sompo Care Inc as of July
31,2019. (Excluding short-term use)
Ⅱ. Sompo Care Sompo no ie, Sompo no ie S, Sompo no ie GH,
Private senior homes (residential), Serviced senior housing,Group homes operated by Sompo Care Inc. as of July
31,2019. (Facilities for short-term use and Facilities
operated by its franchisees and operating partners are
excluded.)

The No. of 425 facilities
Facilities
Area
Contact
No.

Hokkaido, Iwate, , Miyagi, Akita, Saitama, Chiba, Tokyo, Kanagawa,Shizuoka, Aichi, Kyoto, Osaka, Hyogo, Nara, Okayama, Hiroshima,
Fukuoka, Kumamoto+81-120-155-703

Sompo Care LAVIERE Kobe Tarumi
Property
owned by KDR
Homepagehttps://www.sompocare.com/

http://www.centurylife.co.jp/

SENIOR LIFE COMPANYSENIOR LIFE COMPANY● ≪On the condition of limp sum payment≫Discount on lumpsum payment for resident ( ¥ 300,000 discount)
Benefits

Benefits● Trial residence free of charge (1-night, 2-day stay, withdinner and breakfast)● Same-day facility site-visit (with lunch) free of charge

Eligible
PersonUnitholder and his / her spouses and his / her relatives (within
the second degree)

Facilities
Available

All of the private senior homes with nursing care andapartment for the elderly operated by SENIOR LIFE COMPANY
as of July 31,2019.

The No. of 5 facilities
Facilities
Area

Tokyo, Fukuoka

Contact
No.

+81-120-678-723

N/A
Property
owned by KDR
Homepage

HITOWA Care Service Co., Ltd.

https://www.felio.life/

Eligible
PersonFacilities
Available● Same-day facility site-visit (with lunch) free of charge● Discount on usage charge for two-month equivalent

Unitholder and his / her spouses and his / her relatives (within
the second degree)※A resident of the requested healthcare facility and an
application through agencies are ineligible
All of the private senior homes with nursing care operated by
HITOWA Care Service Co., Ltd as of July 31,2019.

The No. of 111 facilities
Facilities
Area
Contact
No.

Hokkaido, Miyagi, Saitama, Chiba, Tokyo, Kanagawa,
Nagano, Aichi, Hyogo, Okinawa+81-120-12-2943

Irise Kamata/Yuseien , Irise Nishioka, Izarie
Property
owned by KDR Eniwa Building
Homepage

http://www.irs.jp/

9Nichii Carepalace Company

NM LIFE Co., Ltd.
● Discount on one-time payment for resident (¥ 200,000 discount)● Same-day facility site-visit(with lunch) free of charge

Benefits● Trial residence free of charge, up to three times (1-night, 2-day stay,● Trial residence free of charge (1-night, 2-day stay, with dinner,lunch and breakfast)
Eligible
PersonUnitholder and his / her spouses and his / her relatives (within
the second degree)

Facilities
Available

All of the private senior homes with nursing care operated by
Nichii Carepalace Company as of July 31,2019.

The No. of 74 facilities
Facilities

Benefitswith dinner and breakfast)● Same-day facility site-visit(with lunch) free of charge (up to threetimes)
Eligible
PersonFacilities
Available

Unitholder and his / her spouses and his / her relatives (within thesecond degree)
Joy Stage Hachioji

Tokyo, Saitama, Chiba, Kanagawa, Shizuoka

The No. of
Facilities

1 facility

Area
Contact
No.

+81-120-555-800

Area

Tokyo

Nichii Home Nakano-Minamidai, Nichii Home Tama Plaza
Property
owned by KDR
Homepage

http://www.nichii-carepalace.co.jp/

Contact No. +81-120-38-0161
Property
owned by KDR
Homepage

Joy Stage Hachioji
http://www.joystage.com/

Sawayaka Club Corporation● 10% discount on usage charge for the first monthly payment

Benefits● Trial residence free of charge (1-night, 2-day stay, withdinner and breakfast)● Same-day facility site-visit(with lunch) free of charge

Eligible
PersonUnitholder and his / her spouses and his / her relatives (within
the second degree)

Facilities
Available

All of the private senior homes with nursing care operated by
Sawayaka Club Corporation as of July 31,2019.

The No. of 70 facilities
Facilities
Area
Contact
No.

Hokkaido, Akita, Tochigi, Saitama, Chiba, Kanagawa,Niigata, Shizuoka, Aichi, Mie, Kyoto, Osaka, Hyogo, Ehime,
Wakayama, Fukuoka, Oita
+81-120-958-490

Sawayaka Sakura Nibankan
Property
owned by KDR
Homepage

http://www.sawayakaclub.jp/

Excellent Care System Co., Ltd.
Benefits
Eligible
PersonFacilities
Available● Same-day facility site-visit (with lunch) free of charge

Unitholder and his / her spouses and his / her relatives (within
the second degree)

CARE TWENTYONE CORPORATION
Benefits● Same-day facility site-visit (with lunch) free of charge

Eligible
PersonUnitholder and his / her spouses and his / her relatives (within thesecond degree)

Facilities
Available

All of the private senior homes with nursing care operated by
CARE TWENTYONE CORPORATION as of July 31,2019.

The No. of
Facilities

38 facilities

Area
Contact No.

Tokyo, Saitama, Chiba, Kanagawa, Aichi, Kyoto, Osaka,
Hyogo, Hiroshima+81-120-944-821

Property
owned by KDR

Plaisant Grand Ota tamagawa

Homepagehttps://www.care21.co.jp/(Note1) A resident of the requested healthcare facility is ineligible .
(Note2) The area and the number of facilities are as of July 31, 2019.
(Note3) There may be restrictions on trial residence due to the operating
condition of operators.
(Note 4) In the case of private senior homes with nursing care, those
who are not required for nursing care may not be able to use this
Unitholder Benefits Program .
(Note 5) It may be necessary to consult with care manager and Medical
checkup before trial residence.

※A resident of the requested healthcare facility and an use inconjunction with other discount system are ineligible.
All of the private senior homes with nursing care operated by
Excellent Care System Co., Ltd. as of July 31,2019.

The No. of 15 facilities
Facilities
Area

Tokyo, Kanagawa, Kyoto, Hyogo, Tokushima

Contact
No.

+81-44-819-5107

Excellent Nishinomiya, Excellent Kitano
Property
owned by KDR
Homepage

http://www.excare.co.jp/

10Unitholders’ benefit programs

Through the utilization of the Unitholder Benefit Program, KDR hope that the unitholders and their families will
be able to realize healthy longevity.

General Outline of the Unitholder Benefit Program
1.Eligible Unitholder
2 Contents

Unitholders stated or recorded on the unitholders’ register of the Investment
Corporation as of July 31, 2019 are eligible for the unitholder benefit program.
Unitholders owing more than 1 unit will be entitled to the benefits as described previous
page.
Please present Semi-annual Report for the fiscal period ended July 2019 (15thfiscal period) and the paper setting forth the name, address, etc. of theunitholder or dividend receipts, which are enclosed in the Semi-annual Report,
to the healthcare facility.

3 .Method for the
Use of Benefits
4 .Validity Period

April 30, 2020

Q&A
Q At which facilities will I be eligible for benefit programs?
A
About Benefit
programFacilities offering programs are shown on the list, but applicable facility types varydepending oneach operator. Please call the operator to find out which facilities offer benefit programs.

Q How can I check the details of benefit programs?

Details of benefit programs vary depending on each operator. Moreover, theremay
be some restrictions to benefit programs due to the operational status ofA
facilities and such. Please call the operator to find out the details of the benefit
programs.
Q What are the procedures required to use the program?
A

Please call and tell the operator that you wish to use the “Unitholder
Benefit Program.” You will be provided with detailed information onnecessary procedures.

Q What do I need to bring when using the program?
How to use

Please bring the document enclosed with this Semi-annual Report affixed
A with your address, name and other information. Some operators or facilities
may require additional confirmation documents. Please confirm the details
with the relevant operator.
Q Can I go directly to a facility when I want to see the facility or do a trial residence?
If you visit a facility without prior notice, they may not be able to respond to yourA request depending on the operational status or vacancy status. Please call theoperator in advance and receive instructions before a visit.

11

II.

Asset management report

1. Outline of asset management operation(1)

Operating result and financial position
Fiscal period

Unit

11th

12th

13th

14th

15th

From Feb. 1, 2017

From Aug. 1, 2017

From Feb. 1, 2018

From Aug. 1, 2018

From Feb. 1, 2019

t o J u l . 3 1 , 2 0 1 7t o J a n . 3 1 , 2 0 1 8

to Jul. 31, 2018

to Jan. 31, 2019

to Jul. 31, 2019

Operating result

Operating revenues

mil.yen

5,574

5,681

7,097

7,823

8,136

(Rental revenues)

mil.yen

5,574

5,671

6,655

7,605

7,933

Operating expenses

mil.yen

2,741
2,124

2,791
2,107

3,657

3,610

3,777

2,554

2,794

2,915

(Expenses related to rent business) mil.yen
Operating income

mil.yen

2,833

2,889

3,439

4,213

4,358

Ordinary income

mil.yen

2,316

2,353

2,842

3,599

3,741

Net income

mil.yen

2,315

2,352

5,416

3,598

3,741

Total asset

mil.yen167,316

176,813

213,558

245,103

254,965%(＋0.0)(＋5.7)(＋20.8)（＋14.8）（＋4.0）

Interest-bearing debt

mil.yen81,80091,130106,130

123,250

125,900

Unitholders’ equity

mil.yen82,55982,65098,745111,951

118,541%(＋0.0)(＋0.1)(＋19.5)（＋13.4）（＋5.9）

Unitholders’ capital

mil.yenTotal distribution

mil.yen80,132
2,424
103.1

80,132
3,152
58.2

93,226
3,510
97.6

99,731
3,687
98.5

349,089

782,928

869,133

907,458(period to period change)Asset(period to period change)

Distribution per unit

Dividend payout ratio (Note 2)%

80,1322,315
100.0

Number of investment units issued
and outstanding

unit

349,089

Net income per unit

(Note 3,4)

yen

6,632

3,369

Unitholders’ equity per unit (Note 3)

yen

236,498

118,379

7,036
126,123

4,143
128,807

4,142
130,630

Distribution per unit

yen

6,633

6,946

4,026

4,039

4,063

Profit distribution

yen

6,633

6,946

4,026

4,039

4,063

Distribution in excess of profit

yen

－

－

－

－

－

Return on assets (Note 5)

%

1.6

1.5

%

1.4
2.7

1.5

Annualized (Note 6)

1.4
2.8

2.9

3.1

3.0

2.8
5.7

2.8
5.6

6.0

3.4

3.2

12.0

49.3

46.7

46.2

6.8
45.7

46.5

(△0.0)(△2.6)(△0.5)（△0.6）（＋0.8）

%

48.9

51.5

49.7

50.3

49.4

FFO
(Funds from Operation)

mil.yen

3,227

3,295

6,126

4,750

4,948

FFO per unit (Note 3,10)

yen

9,246

4,720

7,824

5,466

5,453

mil.yen

4,335

4,486

5,245

6,154

6,408

%

5.6

5.4

5.5

5.5

5.5

mil.yen

4,094

4,199

4,808

5,539

5,796

Return on net assets (Note 7)
Annualized (Note 6)%

Net asset ratio
Financial indicator(period to period change)
Interest-bearing debt ratio on assets(Note 8)(Note 9)(Note11)

Leasing NOI(Net Operating Income)Annualized NOI yield(Note 6,12)(Note 13)

Leasing NCF(Net Cash Flow)

Annualized NCF yield%(Note 6,14)

Number of properties

%

6.5

%

5.3

5.1

5.0

5.0

5.0

properties

113

115

129

138

143

Reference

Leased units (Residential)

unit

7,285

7,646

7,552

8,017

8,080

Total leasable floor area (Note 15)m²

292,324.33

303,608.43

410,556.41

467,606.17

491,050.34

Occupancy ratio (Note 15)

%

96.8

97.0

97.6

97.7

97.5

Depreciation expenses

mil.yen

884

921

1,144

1,343

1,391

Capital expenditures

mil.yen

241

286

436

614

612

12

(Note 1)(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)(Note 8)(Note 9)(Note 10)(Note 11)
(Note 12)(Note 13)
(Note 14)
(Note 15)

Figures are rounded down to the nearest unit. Ratios are rounded off to one decimal place
Dividend payout ratio＝Total distribution(excluding Distribution in excess of profit)/Net income×100
Net income for 13th fiscal period include negative goodwill of 2,574 million yen.
The Investment Corporation investment units was split 2-for-1 on the reference date as of February 28, 2018 and the effective dateas of March 1, 2018. “Net income per unit”, “Unitholders’ equity per unit “ and “FFO per unit “ are calculated subjected for theInvestment Corporation investment units to be split on August 1, 2017.
Net income per unit is calculated by dividing the net income by weighted average of number of investment units
Return on assets ＝Net income /｛(Total assets at the beginning of period + Total assets at the end of period)/2｝×100
Annualized values for the 11th fiscal period are calculated based on a period of 181 days, 184 days for 12th fiscal period, 181 daysfor 13th fiscal period, 184 days for 14th fiscal period, 181 days for 15th fiscal period.
Return on net assets ＝Net income / {(Total net assets at the beginning of period + Total net assets at the end of period) /2} ×100
Interest-bearing debt ratio of assets ＝Interest-bearing debt at the end of period / Total assets at the end of period×100
FFO＝Net income + Depreciation expenses + Amortization of deferred assets - Gain on sale of real estate property + Loss on sale ofreal estate property. Net income for 13th fiscal period include negative goodwill of 2,574 million yen.
FFO per unit ＝FFO／Number of investment units issued and outstanding(rounded down to unit)
Leasing NOI＝Rental revenues －Expenses related to rent business＋Depreciation expenses
Annualized NOI yield＝Annualized NOI／Total acquisition prices of properties ×100
Leasing NCF＝ Leasing NOI－Capital expenditures
Annualized NCF yield ＝Annualized NCF／Total acquisition prices of properties ×100
Figure and ratio include for land with leasehold interest.

13

（2）Outline of asset management operation for the 15th fiscal period(ⅰ) Outline of the history of the Investment Corporation
Kenedix Residential Next Investment Corporation (the “Investment Corporation”) was established on November 15,
2011 under the Act on Investment Trusts and Investment Corporations of Japan (“the Investment Trust Act”). On
April 26, 2012, the Investment Corporation was listed on the Real Estate Investment Trust Market of the Tokyo Stock
Exchange (Securities Code: 3278). The Investment Corporation subsequently issued new investment units throughthree public offering and by way of third-party allotment to expand its market capitalization and steadily grow its
asset size. Moreover, seeking further growth opportunities, the Investment Corporation conducted an absorption typemerger (“the Merger”) with the Investment Corporation as the surviving corporation and Japan Senior Living
Investment Corporation (“JSL”) as the absorbed corporation on March 1, 2018. Following the merger, the Investment
Corporation implemented a 2-for-1 investment unit split with an effective date of March 1, 2018.
In the 15th fiscal period, the Investment Corporation issued for the second consecutive period new investment units
through public offering and third-party allotment and acquired 6 properties (the total acquisition price (Note 1) is
12,844 million yen) using the funds procured and new borrowings.
As of the end of the 15th fiscal period (July 31, 2019), the number of properties was 143 (total acquisition price:
233,251 million yen (excluding silent partnership equities; the same applies hereinafter)) and the number ofinvestment units issued and outstanding is 907,458 units.
The Investment Corporation entrusts the asset management to Kenedix Real Estate Fund Management, Inc. (the“Asset Management Company”), a company that was formed with personnel from Kenedix, Inc. and adheres to thecore philosophies of Kenedix, Inc. The Asset Management Company provides real estate investment management
services with flexibility and agility unique to a J-REIT (Note 2) sponsored by an independent real estate managementcompany by flexibly pursing optimal investment opportunities and income opportunities and agilely investing andmanaging based on swift information gathering and decision-making while accurately grasping real estate-related
trends.
（Note 1）“Acquisition price” is the sales price of each trust beneficiary interest or real estate indicated in each trust beneficiary interest sales
contract and real estate sales contract concerning the owned assets (excluding acquisition costs, adjustment in property tax andcity-planning tax, and consumption tax) and is rounded down to the nearest million yen. The appraisal value as of March 1, 2018
is indicated as the acquisition price for assets succeeded by JSL due to the merger. The same applies hereinafter.
(Note 2) "J-REIT" is an investment corporation listed on the real estate investment trust of the Tokyo Stock Exchange.

(ⅱ) Investment Environment
During the 15th fiscal period, the Japanese economy was partly weak in exports and production activities, affectedby overseas economic trends, such as the slowdown in the Chinese economy. However, domestic demand has beenon an increasing trend, as consumption has continued to pick up due to a favorable employment and income
environment and a high level of corporate profits, and capital investment has also been on an upward trend. The
Japanese economy is expected to continue to recover moderately, given that the fundamentals supporting domestic
demand are favorable. On the other hand, it is necessary to pay attention to the impact on the world economy of thecontinuing moderate slowdown in the Chinese economy, the trade issues between the United States and China, andthe UK's decision to leave the EU, as well as trends in consumption following the consumption tax rate hike scheduled
for October 2019, and the possibility of future fluctuations in the financial and capital markets for the domestic
economy.
In the rental housing market, the occupancy rates and rent levels of the rental apartment buildings in which theInvestment Corporation invests remain high. Given that metropolitan areas continue to experience population growth
while rental apartment supplies remain low, a favorable supply-demand environment is expected for these areas in
the future.
Concerning the environment surrounding healthcare facilities, with one of the longest average life expectancies
for both men and women, Japan now has a super-aging society (Note) which no other country has ever experienced,
and the “aging,” or the increase in the ratio of the elderly population against total population and the increase in14

elderly population itself, is expected to continue going forward. In response to such trends, the number of senior carefacilities such as private senior homes with nursing care and serviced senior housing has been on the rise in recent
years. The Investment Corporation believes that demand for senior care facilities, including nursing care facilities,
will continue to increase.
We continue to see active investment activity in the real estate investment markets on the part of both Japanese andoverseas investors.
With The Bank of Japan’s aggressive monetary easing measures in the background, active transaction are expected
to continue in real estate market; however, due to the ongoing harsh property acquisition environment, expected yieldis likely to remain at a low level.
(Note) “Super-aging society” refers to a society with a population aging rate (ratio of the elderly population aged 65 or over against total
population) exceeding 21%, as defined by the World Health Organization and the United Nations.

15

3. Operating Results(A) Acquisition and sale of assets
The Investment Corporation comprehensively taking into account the composition of the entire portfolio,
earnings power in the future, etc., the Investment Corporation acquired 3 residential properties (total acquisition
price: 3,158 million yen), acquired 3 healthcare facilies (total acquisition price: 9,685 million yen) and sold 1
residential property (acquisition price: 510 million yen / sold price:690 million yen).
＜Acquired assets＞
Acquisition price
Property number
Property name（million yen）（Note）
T-81
KDX Residence Kamikitazawa
1,360
T-82
KDX Residence Kaminoge
1,111
T-83
KDX Residence Higashi-Asakusa
687
Residential
Total
3,158
H-22
Tsukui Sun-shine Machida
6,934
H-23
Serabi Ebisu
1,690
H-24
Arute Ishiyagawa
1,061
Healthcare
Total
9,685
＜Sold assets＞

Property number
R-23

Property nameSold price（million yen）

KDX Residence Shin-Osaka

690（Note）(Note) “Acquisition Price” and “Sold Price” are the sales amount of each trust beneficiary interest (excluding acquisition costs,
property tax, city planning tax or consumption tax, etc.) indicated in each trust beneficiary interest sales contract concerning
the acquired assets and sold assets, and are rounded down to the nearest million yen.

As a result of the above, as of the end of the 15th fiscal period, the Investment Corporation owned a total of 143
properties (total acquisition price: 233,251 million yen), which consist of 118 residential properties (acquisition
price: 177,373 million yen), 24 healthcare facilities(acquisition price: 54,128 million yen) and 1 other property (landwith leasehold interest; acquisition price: 1,750 million yen).

（B）Management and Operation of Assets
With respect to residential, The Investment Corporation managed our real estate holdings with the aim ofachieving stable and optimal performance by working with a property management company (“PM Company”)
that operates and manages properties, which were selected through a multifaceted approach of taking into
consideration the region, location and city, rent range, tenant type (corporate or individual) and other various
characteristics .
Moreover, the Investment Corporation strove to partner with leading real estate companies with a strong local
presence and bolster the PM Company’s efficient leasing activity. We also ensured that soliciting conditions took
into consideration the characteristics and occupancy levels of individual properties; carried out efficient
advertising efforts utilizing the power of the KDX Residence brand; utilized leasing agents; and implemented
flexible sales activities attuned to the characteristics of each of the properties in accordance with plans.
Specific measures that contributed to improvement in revenue at the rental business are as follows: with respect
to properties with stable and robust occupancy conditions, we strove to raise rent levels for and obtain key moneyfrom new tenants; raise rents when leases were renewed; increase revenue associated with auxiliary facilities; andimprove the parking contract rate; and as measures to slash rental business expenses, we reduced utility bills byswitching the electricity supplier for common areas; changed the lighting in common areas to LED; and reviewed
the contracts for auxiliary facilities, as well as solicitation costs, etc., in order to improve income and expenditures.
Moreover, with the aim of maintaining and/or improving the market competitiveness of our portfolio assets, weundertook planned major renovation work at five properties, updating work in common areas as well as valueincreasing work and facility updates in individually-owned areas.

16

The Investment Corporation continued to introduce LED lighting to common areas as part of our environmental
efforts, and obtained 7 properties of DBJ Green Building Certification from external rating agencies in the end of
the 15th fiscal period (July 31, 2019).
As a result of the above, the occupancy rate for residential facilities was 96.4% as of the end of the 15th fiscal
period (July 31, 2019), the high level as the previous fiscal period.
As a specific measure contributing to the maintenance and improvement of revenue at the rental business forhealthcare facilities, the Investment Corporation visited facilities to confirm their operating status, including
revenues, expenditures, and occupancy rates, and made inquiries to facility managers while also inquiring aboutbusiness conditions, future management policies, etc. through interviews with operation managers, etc. as part ofoperator monitoring activities.
As a result of the above, the occupancy rate for healthcare facilities was 100% as of the end of the 15th fiscal
period (July 31, 2019). The occupancy rate for the entire portfolio including land with leasehold interest was
97.5% as of the end of the 15th fiscal period (July 31, 2019).

17

（C）Financing
The Investment Corporation procures funds with the aim of medium- to long-term stable earnings and sustained
growth of portfolio assets, taking into consideration the balance between financial stability and financing costs.
(Issuance of New Investment Units)
During the 15th fiscal period, the Investment Corporation procured 6,195 million yen of funds by issuing 36,500
new investment units through public offering on February 20, 2019 with the aim of allocation to funds foracquisition of specified assets. In addition, the Investment Corporation procured 309 million yen of funds by
issuing 1,825 new investment units through third-party allotment on March 11, 2019 with an aim of procuring
funds for acquisition of specified assets and repayment of borrowings in the future.
As a result, unitholders’ capital came to 99,731 million yen as of the end of the 15th fiscal period (July 31,2019).
(Debt Finance)
The Investment Corporation newly borrowed 2,900 million yen as funds for acquisition of new properties aswell as 4,300 million yen as funds for repaying borrowings of which repayment was due during the 15th fiscal
period. In addition, on July 29, 2019, the Investment Corporation newly concluded a commitment line
agreement (total maximum borrowing amount of 4,500 million yen) for which the contract period commenced
on August 1, 2019.
As a result of the foregoing, the average remaining term of interest-bearing debt (Note 1) was 4.4 years, and theaverage interest rate at the end of the 15th fiscal period (Note 2) was 0.98%. The long-term debt ratio (Note 3) cameto 87.5%, the fixed interest-rate ratio (Note 4) was 94.3%, and the loan to value ratio (LTV) came to 49.4% in theend of 15th fiscal period (July 31, 2019).
(Note 1)
(Note 2)

(Note 3)(Note 4)

It is calculated by weighting and averaging the remaining term of each interest-bearing debt according to the balance ofeach interest-bearing debt and rounded off to decimal place.
The average interest rate of each interest-bearing debt was calculated taking into account the upfront fee (per annum) andinterest rate swaps, etc., and the weighted average was calculated in accordance with the balance of each interest-bearingdebt.
Long-term debt ratio = (balance of long-term borrowings (excluding long-term borrowings to be repaid within one year)+ balance of investment corporation bonds) ÷ (balance of borrowings + balance of investment corporation bonds)
The long-term debt ratio that includes long-term borrowings to be repaid within one year is 98.0%.
The fixed interest-rate ratio = (balance of fixed interest-ratio borrowings (including borrowings for which interest rates
are substantially fixed through interest rate swap transactions, etc.) + balance of investment corporation bonds) ÷ (balanceof borrowings + balance of investment corporation bonds)（Credit Ratings)
The status of the credit ratings as of the end of the 15th fiscal period (July 31, 2019).
Credit Rating Agency
Japan Credit Rating Agency, Ltd.(JCR)

Type
Long-term issuer rating
Bond rating

RatingA+ (Outlook : Stable)A+（Shelf Registration)
The Investment Corporation filed a shelf registration statement regarding investment corporation bonds(excluding short-term investment corporation bonds) on June 28, 2018 with the following overview.
Planned issuanceamountPlanned issuance
periodUse of proceeds

100,000 million yen
From July 6, 2018 to July 5, 2020
Funds for acquiring specified assets (having the meaning as set forth in the Act on
Investment Trusts and Investment Corporations, Article 2, Paragraph 1); funds for
repaying borrowings; funds for redeeming investment corporation bonds (including
short-term investment corporation bonds; funds for returning deposits); funds forpaying for repairs and maintenance, etc.; operating capital, etc.

18

The Investment Corporation issued 1,000 million yen of the Fourth Series Bonds and 1,000 million yen of theFifth Series Bonds on November 30, 2018 based on the above shelf registration.

4. Overview of Financial Results and Cash Distribution
As a result of these management efforts, the Investment Corporation reported total operating revenues was 8,136
million yen, operating income was 4,358 million yen, ordinary income was 3,741 million yen and net income was
3,741 million yen for the 15th fiscal period.
In regard to profit distributions for the 15th fiscal period, pursuant to the distribution policy in the Investment
Corporation’s certificate of incorporation, the Investment Corporation has decided to apply special provisions of thetax system for investment corporations (Act on Special Measures Concerning Taxation (Act No. 26 of 1957; asamended) (“Act on Special Measures Concerning Taxation”), Article 67-15) and to distribute 3,687,001,854 yen as
profit distribution from unappropriated retained earnings for the 15th fiscal period, which is the amount of the net
income excluding a part of gain on sale of real estate property, etc., plus the reversal of Reserve for temporary
difference adjustment.
If gains on the sale of properties occur in the future, the Investment Corporation will consider whether we needsimilar internal reserves as long as cash distribution does not fall below the initial projection, taking into considerationsuch need in accordance with the circumstances.

19

（3）Changes in unitholders’capital
The changes in unitholders’ capital and number of investment units issued and outstanding for last five years are
as follows.
Date
August 6, 2014
September 3, 2014
February 4, 2015
March 4, 2015
March 1,2018
March 1,2018
August 1, 2018
August 29, 2018
February 20, 2019
March 11, 2019

Capital transaction
Public offering
Third-party allotment
Public offering
Third-party allotment
Investment unit split
MargerPublic offering
Third-party allotment
Public offering
Third-party allotment

Number of investment units
Issued and outstanding
Increase
Balance
36,375277,997
1,125
279,122
67,900347,022
2,067
349,089
349,089
698,178
84,750782,928
82,100865,028
4,105
869,133

Unitholders’ capital(Million yen)
Increase
Balance
8,273
56,865
255
57,121
22,33079,452679
80,13280,132－80,132－
12,47092,602623
93,22636,500905,633

6,195

99,421

1,825

907,458309

99,731

Remark(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)(Note 8)(Note 9)(Note 10)(Note 1) New investment units were issued at a price of ¥235,657 per unit (subscription price of ¥227,439 per unit) through a public offeringin order to raise funds for acquiring new properties.
(Note 2) New investment units were issued at a price of ¥227,439 per unit through the third-party allotment in order to raise funds for
miscellaneous expenses related to the acquisition of new properties.
(Note 3) New investment units were issued at a price of ¥340,762 per unit (subscription price of ¥328,879 per unit) through a public offeringin order to raise funds for acquiring new properties.
(Note 4) New investment units were issued at a price of ¥328,879 per unit through the third-party allotment in order to raise funds for futureacquisitions of specified assets and repayment of borrowings.
(Note 5) The Investment Corporation investment units was split 2-for-1 on the reference date as of February 28, 2018 and the effective dateas of March 1, 2018.
(Note 6) In connection with the Merger, the Investment Corporation unit following the Investment Unit Split was allocated to every JSL
unit with 84,750 JSL units newly issued on March 1, 2018.
(Note 7) New investment units were issued at a price of ¥157,047 per unit (subscription price of ¥151,892 per unit) through a public offeringin order to raise funds for acquiring new properties.
(Note 8) New investment units were issued at a price of ¥151,892 per unit through the third-party allotment in order to raise funds for futureacquisitions of specified assets and repayment of borrowings.
(Note 9) New investment units were issued at a price of ¥175,500 per unit (subscription price of ¥169,740 per unit) through a public offeringin order to raise funds for acquiring new properties.
(Note 10) New investment units were issued at a price of ¥169,740 per unit through the third-party allotment in order to raise funds for futureacquisitions of specified assets.

【Changes in Unit Price at Tokyo Stock Exchange】
The highest and lowest closing prices of the investment units listed on J-REIT section of the Tokyo Stock Exchange
for each fiscal period are as follows.
Fiscal period
For the fiscal period ended
Highest price
Lowest price11th Fiscal period
July 31, 2017
320,500

12th Fiscal period 13th Fiscal period（Note） 14th Fiscal period
January 31, 2018
July 31, 2018
January 31, 2019329,500

172,800

181,000

15th Fiscal period
July 31, 2019
192,600

263,100
274,800
148,400
160,500
179,900(Note) The Investment Corporation investment units was split 2-for-1 on the reference date as of February 28, 2018 and the effective date as ofMarch 1, 2018.Figures for the 13th fiscal period take into account the investment unit split.

20

（4）Distributions
The Investment Corporation intends to apply the corporate income taxation special provision (Act on Special
Measures Concerning Taxation, Article 67-15) that specifies deduction of an amount equivalent to profit distributions
as deductible expenses from an investment corporation’s taxable income, and in accordance with the distribution policy
set forth in the Investment Corporation’s certificate of incorporation, Article 38 (1), has decided to distribute 3,687,001
thousand yen as profit distribution from unappropriated retained earnings for the 15th fiscal period, which is the amountobtained by deducting a portion of gain on sale, etc. from the net income for the 15th fiscal period and adding thereversal of the Reserve for temporary difference adjustment.
As a result, distributions per unit for the 15th fiscal period amounted to 4,063 yen.
14th
11th
12th
13th
15th
From Feb.1, 2017 From Aug.1, 2017 From Feb.1, 2018 From Aug.1, 2018 From Feb.1, 2019
to Jul.31, 2017
to Jan.31, 2018
to Jul.31, 2018
to Jul.31, 2019
to Jan.31, 2019

Fiscal period
Unappropriated retained(Thousand yen)earnings(Thousand yen)
Retained earnings
Total distribution(Distribution per unit)

2,400,002

2,437,011

5,428,676

3,875,050

4,125,881

84,495

12,2392,276,608

384,622458,879(Thousand yen)

2,315,507

2,424,772

3,152,068

3,510,428

3,687,001(Yen)（6,633）（6,946）（4,026）（4,039）（4,063）2,315,507

2,424,772

3,152,068

3,510,428

3,687,001（6,633）（6,946）（4,026）（4,039）（4,063）

－

－

－

－

（－）

（－）

（－）

（－）

－

－

－

－

（－）

（－）

（－）

（－）

－

－

－

－

（－）

（－）

（－）

（－）

(Thousand yen)
Profit distribution(Profit distribution per
(Yen)
unit)
(Thousand yen)
Unitcapital refunds(Unitcapital refunds per
(Yen)
unit)
Unitcapital refund fromretained earnings for(Thousand yen)temporary difference
adjustment(Unitcapital refund fromretained earnings for(Yen)
temporary difference
adjustment per unit)
Unitcapital refunds fromdeduction of unitcapital (Thousand yen)under tax rules(Unitcapital refunds fromdeduction of unitcapital (Yen)under tax rules per unit)

－
（－）
－

（－）

－

（－）

（5）Management Policy and Issues to be Addressed
Outlook for Asset Management
The Investment Corporation primarily invests in residential facilities mainly such as rental housing, etc.,
healthcare facilities such as private senior homes with nursing care and accommodation facilities such as hotels,
based on the three core strategies: “Consistent External Growth by Making Use of Good Judgment,” “EfficientProfit Management” and “Challenge to New Business Opportunities.”
Going forward, the Investment Corporation will continue to seek maximization of unitholder value by evolving
into a REIT capable of adapting to change in social/economical structures and improving its “stability” and “ability
to pursue growth,” through diversified investment in “spaces where people live and stay” encompassing residential
facilities, healthcare facilities and accommodations.
Based on the above three principal investment targets, the Investment Corporation newly added child-carefacilities as an investment target on September 12, 2019.As "spaces where people live and stay" they are
considered to have close affinity with the residential facilities of the Investment Corporation.

21

（A）New property acquisitions
The Investment Corporation will invest primarily in residential, healthcare and accommodation properties“spaces where people live and stay” as its target investments. In making investments, the Investment Corporation
will stringently select real estate etc. where stable demand from tenants and users and long-term stable revenue
flows can be projected on the basis of an individual analysis of the attributes of a particular property, as well as
regional analysis taking into account location, etc.
In residential facilities, the Investment Corporation focuses on the potential earnings power of land and use“location prestige,” “location convenience” and “whether there is a special market” and other metrics to determine
investment opportunities providing rental income with medium- to long-term stability, and invests also in rental
residential properties and other residential facilities located mainly in greater Tokyo and in Other Regional Areas(government-designed municipalities and other regional cities. The same applies hereinafter.) by discerning room
types where stable rent demand can be expected, in accordance with the locational characteristics after analyzing
the attractiveness of the land in detail.
In healthcare facilities and accommodations, the Investment Corporation judges investment opportunity
considering scale and characteristic of market, regional financial affairs and status of competitive facilities, etc.
and examines investment mainly in three major metropolitan area.
We leverage our “judgment capabilities” that we have developed as real estate investment professionals to selectexcellent investment opportunities among a broad range of targets, and we believe this enables us to acquire
properties at a stable pace.
As a property acquisition channel, we use not only the pipeline from Kenedix, Inc and Kenedix Investment
Partners, Inc. pursuant to the Memorandum of Understanding concerning Real Estate Information Provisions dated
October 1, 2013 (including the change after the date and calls “Support Line MOU”. This Support Line MOU wasused for i) residential facilities, ii and) healthcare facilities and iii) accommodations and Residential REIT
department is applied for those having a priority consideration right to responsible for the asset management of
the Investment Corporation) but also leverage the Asset Management Company’s own network, including Jyukyo
Holdings Co., Ltd., with which a support agreement was executed on June 15, 2017 and Shinsei Bank, Limited,
HASEKO Corporation, Mitsubishi UFJ Trust and Banking Corporation and LIXIL Group Corporation, withwhich a support agreement was executed on November 10, 2017 by the Merger, for flexible property acquisitions.
We also plan to control property acquisition timing in order to acquire properties at an advantageous timing inaccordance with the future market and financing climates, and we are considering investment in silent partnership
equities and real estate-backed securities (preferred securities, etc.).

（B）Management of owned assets
As residential facilities, with the goal of securing a rental income with medium- to long-term stability, PM
companies and the Asset Management Company work together to formulate leasing strategies in accordance withindividual property characteristics, and by closely allying with leading real estate companies experienced inregional rental markets, seek to maintain or improve occupancy rates and rent levels.
The Investment Corporation will also take into account the operation statuses of the properties and movementsof competing properties and seek to maintain or improve occupancy rates, raise rent levels at the time of tenantchanges, increase rent at the time of lease renewals, receive key money, reduce the time of vacancy, maintain or
improve lease renewal rates, and secure parking revenue and other auxiliary revenue and other income
opportunities to secure rent income.
The Investment Corporation will further strive to cut down on restoration and other repair and maintenanceexpenses, review the electricity provider for common areas in connection with the liberalization of the electricity
market, cut costs through the use of LED lighting for common areas, and reduce tenant solicitation and other costs.
The Investment Corporation will carry out strategic work to update common areas and enhance the value ofleased areas of the properties and continue implementing appropriate, major repairs, as necessary, while it seek tomaintain or enhance the market competitiveness of its assets.

22

As healthcare facilities, the Investment Corporation continues to monitor properly operational status of facilities
it owns and business status of operators by information about them and companies from operators, inspection ofoperating status and interview by visiting them and interview with managements in operating company, etc.
Considering results of monitoring, the Investment Corporation proposes to improve buildings, facilities andoperation and examines changing operators in case important issue occurs in succession of management in
operators. The Investment Corporation contracts Back-up operation conclusion with operators and support
companies in preparation of changing operators.
The Investment Corporation will manage to make internal growth by deepening relation with operators such as
value-ups based on proposal from operators and cooperation for resolving issues in operation.

23

（C）Financing
The Investment Corporation will continue to pay close attention to changes in interest rates and otherdevelopments in the financing environment and will consider various options and choose optimal financing meansin order to achieve the optimal balance between financial stability and financing costs, and seek to build an
appropriate financial base.

（D）Disclosure of Information
The Investment Corporation’s basic policy for disclosure is to engage in proactive investor relations activities
to provide a broad range of information to investors and concerned parties and to quickly disclose accurate
information to the extent possible. Specifically, we practice appropriate disclosure though the Tokyo Stock
Exchange (TDnet registration and press releases) and through our website (https://www.kdr-reit.com/en).

（E）Conflicts of interest
The Asset Management Company has established related-party transaction rules of the Residential REIT
Department and conducts management based on said rules upon transactions with related parties in the
management of assets of the Investment Corporation. The Asset Management Company is also entrusted withmanagement of other REITs of Kenedix group, and which may compete against the Investment Corporation in theacquisition of investment properties. The Asset Management Company has established a department that obtains
information for sales of real estate and preferentially considers acquisition thereof. For this reason, the AssetManagement Company prepared a rule on “Right of first consideration” based on type and scale of properties anddetermines the order of consideration within the Asset Management Company in advance, in addition to setting
up internal “pipeline meetings” with a compliance officer in attendance, implementing operation in accordancewith certain rules. By doing so, the Asset Management Company prevents arbitrary distribution of real estate sales
information and thereby prevents conflicts of interest from arising among the investment corporations whose
assets it manages, and strives to implement proper measures to address conflicts of interest.

（6）Important Subsequent Events
Not applicable.
(Reference)(ⅰ) Acquisition of assets
The Investment Corporation acquired the following trust beneficiary interest in real estate on September 12, 2019,
Date of
Acquisition

Property
number

September
17, 2019

T-84（Note 1）

T-85

（Note 1）

R-46

Property NameKDX Residence NishiFunabashi
KDX Residence Hatagaya(Note 2)

KDX Residence Sendai
Station East (Note 2)
Total

Location
Funabashishi, Chiba
Shibuya-ku,
TokyoSendai-shi,
Miyagi

Previous Owner

Non-Disclosure (Note 3)
THE SANKEIBUILDING CO., LTD.
Hoosiers AssetManagement Co.,Ltd.

Acquisition
Price（mil.yen）

Appraisalvalue（mil.yen）（Note 4）（Note 5）

975

1,060

2,500

2,710

1,340

1,410

4,815

5,180

(Note 1)The date for T-85 designated in writing by the Investment Corporation no later than 10 business days prior to the sale provided
that the due date is February 28, 2020. The due date for R-46 shall be within 6 months from the date of conclusion of the sales
contract, and the date designated in writing by the Investment Corporation by 7 business days
prior to the date of the sale.
(Note 2) The trust beneficiary interest sales contract associated with the assets for T-85 and R-46 fall under the forward commitments, etc.
by the Investment Corporation as specified in the Financial Services Agency “Comprehensive Guidelines for Supervision of
Financial Instruments Business Operators, etc.”(Note 3) Not disclosed according to seller’s intention24

(Note 4)“Acquisition Price” is the sales amount of each trust beneficiary interest (excluding acquisition costs, property tax, city planningtax or consumption tax, etc.) indicated in each trust beneficiary interest sales contract concerning the to-be acquired assets and isrounded down to the nearest million yen.
(Note 5) “Appraisal Date” is as September 1, 2019.

25

(ⅱ) Financing
The Investment Corporation newly established a commitment line agreement to secure flexibility and stability infinancing method, for potential needs of funds on July 29, 2019.
Limit of maximum amountCounterparty
Contract period
Collateral(million yen)
Sumitomo Mitsui Banking
1,500
Corporation
Unsecured,
August 1, 2019 to
MUFG Bank, Ltd
1,500
unguaranteed
July 31, 2020
Mizuho Bank, Ltd
1,500
On September 12, 2019, the Investment Corporation decided to borrow 1,000 million yen (Series 34) on September
17, 2019 in order to allocate part of the funds to the acquisition of T-84 of the above-mentioned assets and associatedcosts thereof.

2．Overview of the Investment Corporation（1）Unitholders’ Capital
Fiscal period

11th
As of July 31,
2017

Total number of authorized
investment units (Unit)
Total number of investment
units issued andoutstanding (Unit)
Unitholders’ capital(Million yen)
Number of unitholders(People)12th
As of January 31,
2018

13th
As of July 31,
2018

14th
As of 31, January
2019

15th
As of July 31,
2019

5,000,000

5,000,000

10,000,000

10,000,000

10,000,000

349,089

349,089

782,928

869,133

907,458

80,13280,13280,132

93,226

99,731

9,328

8,466

12,847

12,484

11,684

Number ofinvestment units
held

Ratio（％）（2）Matters concerning Investment Units
Major unitholders as of July 31, 2019 are as follows.
Name

Address（Note）(Units)Japan Trustee Services Bank, Ltd. (Trust
Acct.)

8-11, Harumi 1-chome, Chuo-ku,
Tokyo253,064

27.88

The Master Trust Bank of Japan Ltd. (Trust
Acct.)

11-3, Hamamatsu-cho 2chome,Minato-ku, Tokyo

175,232

19.31

The Nomura Trust Banking Co., Ltd. (Trust
Acct.)

2-2, Otemachi 2-chome, Chiyoda-ku,
Tokyo
8-12, Harumi 1-chome, Chuo-ku,
Tokyo
Harumi Island Toriton Square OfficeTower Z
4-5, Marunouchi 1-chome, Chiyoda-ku,
Tokyo37,1484.09

25,4882.80

17,223

1.89

16,5701.82

13,258

1.46

12,446

1.37

12,171

1.34

Trust and Custody Services Bank, Ltd.
(Securities Investment Trust Acct.)
Mitsubishi UFJ Trust and Banking Corporation
Kenedix, Inc.
BNYM AS AGT/CLTS 10 PERCENT
Mitsubishi UFJ Morgan Stanley Securities
Co., Ltd.
The Gunma Bank, Ltd.

2-1 Uchisaiwai-cho 2-chome, Chiyodaku, Tokyo
7-1, Marunouchi 2-chome, Chiyoda-ku,
TokyoStanding proxy: MUFG Bank, Ltd.
5-2, Marunouchi 2-chome, Chiyoda-ku,
Tokyo
194, Motosojamachi, Maebashi-shi,
Gunma

26

STATE STREET BANK WEST CLIENTTREATY 505234
Total

Shinagawa Intercity Tower A 15-1, 2chome, Kohnan, Minato-ku, Tokyo
Standing proxy: Mizuho Bank, Ltd.

11,5971.27

574,197

63.27(Note) Ratio of number of investment units owned to total number of investment units issued is calculated by being rounded down to two
decimal places27

（3）Matters Concerning Directors and Auditor(ⅰ) The Executive Directors, Supervisory Directors and the Independent Auditor during the 15th fiscal
period are as follows.
Position

Name

Executive
Director

Supervisory
Director

Total amount of fees
paid during the period(thousand yen)

Other concurrent title

Keisuke Sato

Kenedix Real Estate Fund Management, Inc.
Director & COO, Head of Residential REIT Department

1,800

Katsue Okuda

Ogata Appraisal Corporation, Director
Lecturer in Meiji University’s Graduate School of Global
Business
Japan Association of Real Estate Appraisers, Managing
director
Kudan Ogata Holdings Corporation, Representative
director
Kudan Urban Appraisal Co., Ltd., Director
CERESPO CO.,LTD., Auditor

1,800

Osamu Chiba

Akebono Law Office, Attorney
Toin Law School, Associate Professor
Maruzen Foods Corporation, Outside Auditor
IMAGICA GROUP Inc., Outside Director

1,500

Satoshi Ogawa

Ogawa CPA Office, CPA
GK Mercury Consulting, Representative Partner
Oedo-Onsen Monogatari Co., Ltd, Auditor
Ooedo Onsen Monogatari Hotels & Resorts Co., Ltd.
Auditor

1,500

Soichiro Iwao

Hungarian Medical Universities, Director
Chigasaki Central Clinic, Director
Medical Corporate Body Ken-iku kai, Vice President

1,500（Note 1）

National Federation of Industrial Health Organization, Director

Independent
auditor（Note 2）

(Note 1)
(Note 2)

Ernst & Young ShinNihon
LLC

15,000－Supervisory Director may be an officers of corporations other than mentioned above, but there is no interest in relation to theInvestment Corporation.
The fee of Independent auditor includes remuneration for Comfort Letter creation work related to issuance of new investment
units.

(ⅱ) Policy on Decisions to Terminate or not Reappoint the Accounting Auditor
Dismissal of an independent auditor will be made in accordance with the Act on Investment Trusts and Investment
Corporations, and a decision not to re-appoint an independent auditor will be considered by comprehensively taking
into account the audit quality, compensation and other various circumstances by the board of directors of theInvestment Corporation.

（4）Asset Management Company, Custodian and General Administrators
The asset management company, custodian and general administrators as of the end of the 15th fiscal period are as
follows.
Classification

Name

Asset manager

Kenedix Real Estate Fund Management, Inc.

CustodianMizuho Trust & Banking Co., Ltd.

General administrator (Unitholder registry)

Sumitomo Mitsui Trust Bank, Limited

General administrator (Regarding book keeping)Mizuho Trust & Banking Co., Ltd.

General administrator (Administration)

Mizuho Trust & Banking Co., Ltd.

28

General administrator(Regarding investment corporation bonds)

Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.

29

3．Status on Investment Properties（1）Component of Assets
Classification

Use

14th
As of January 31, 2019
Total amountComposition ratio
held(%)(mil.yen)(Note 6)Areaof assets（Note 5）Residential
Trustbeneficiaryinterest inreal estateTokyo Metropolitan
Area (Note 2)
Other Regional Area
(Note 3)

Healthcare

Tokyo Metropolitan
Area (Note 2)
Other Regional Area
(Note 3)

Other (Note 4)

Total (Trust beneficiary interest in real estate)
Real estate
Other
Tokyo Metropolitan
Area (Note 2)
Total (Real estate)
Silent partnership equity interest (Note 1)
Bank deposits and other assets
Total assets

15th
As of July 31, 2019
Total amountComposition ratio
held(%)(mil.yen)(Note 6)（Note 5）

118,40348.3

121,350

47.6

56,70523.1

55,96922.0

13,8105.6

22,751

8.9

29,29112.0

30,29811.9

1,346
219,558

0.5
89.6

1,328
231,698

0.5
90.9

1,798

0.7

1,798

0.7

1,798
111

0.7
0.0

1,798
2

0.7
0.0

23,635

9.6

21,467

8.4

245,103

100.0

254,965100.0(Note 1) Subordinated silent partnership equity interest in GKTropic Ⅲ.
(Note 2) “Tokyo Metropolitan Area” means major cities in Tokyo, Kanagawa, Saitama and Chiba.
(Note 3) “Other regional areas” include government-designed municipalities and other regional cities.
(Note 4) “Other” means cities except Tokyo Metropolitan Area and Other regional areas.
(Note 5) “Total amount held” means carrying amounts on the balance sheet (amounts of Trust beneficiary interests in real property and real
property are book values net of depreciation) at the end of fiscal period and rounded off to one dismal place.
(Note 6) “Composition ratio” means the ratio of carrying amounts of each classified assets to total assets on balance sheet and rounded off to
one dismal place.

（2）Major Assets Owned
The overview of major assets owned by the Investment Corporation (Top 10 properties in net book value as of July
31, 2019) are as follows.
No.

Name of property

T-78

KDX Residence Toyosu
KDX Residence Shukugawa
Hills

R-45

7,734

6,811.38

Ratio of rental
Occupancy
revenue to total
Major use
Rate (%)
rental revenue(Note 3)(%) (Note 4)
6,811.38
100.0
2.3 Residential

7,263

17,575.39

16,504.36

Book value Leasable area
(Million yen) (m²) (Note 1)

Leased area(m²) (Note 2)

93.9

2.6 Residential
Non-Disclosure

H-22

Tsukui Sun-shine Machida

7,187

15,553.33

15,553.33

100.0

H-10

Activa Biwa

6,429

39,649.84

39,649.84

100.0

T-56

KDX Residence Hanzomon

4,950

4,854.23

4,770.77

98.3

1.7 Residential

T-1

KDX Daikanyama Residence

4,781

5,338.99

5,271.41

98.7

2.1 Residential

R-39

KDX Residence Ohori Harbor
View Tower

4,547

11,855.63

9,106.54

76.8

2.4 Residential

H-3

Joy Stage Hachioji

3,783

13,812.27

13,812.27

100.0

T-52

KDX Residence Togoshi

3,745

4,591.76

4,497.84

98.0

H-16

Anesis Teradacho

3,557

7,856.64

7,856.64

100.0

53,981

127,899.46

123,834.38

-

Total

(Note 5)

Healthcare

NonDisclosure

Healthcare(Note 5)

Non-Disclosure(Note 5)

Healthcare

1.5 Residential
Non-Disclosure(Note 5)

Healthcare

20.5（Note 1）“Leasable area” is the floor area of each portfolio asset for which the building is leasable (if a portfolio asset has more than one

30

building, the total floor area of leasable buildings) that is set forth in a lease agreement as of July 31, 2019.
（Note 2）“Leased area” is the floor space set forth in a lease agreement that has been executed with an end tenant and leased as of July 31,
2019.
（Note 3）“Occupancy rate” = “leased area” / “leasable area” ×100
（Note 4）The ratio of rental revenue to total rental revenue = each property’s real estate lease business revenue / total for all properties.
（Note 5）The Investment Corporation has not obtained consent from the tenant to release this information.

31

（3）Overview of the Portfolio（Detail of Real Estate Portfolio Assets）
The overview of assets under management of the Investment Corporation as of the end of the 15th fiscal period (July31, 2019) is as follows.
Book

Use

Area

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)

TBI

4,781

6,200

KDX Odemma Residence
3-10,Nihombashi-Odenmacho,Chuo-ku,Tokyo
KDX Iwamoto-cho
T-4
16-12,Iwamotocho 2-chome,Chiyoda-ku,Tokyo
Residence
KDX Bunkyo Sengoku
T-5
3-2,Honkomagome 6-chome,Bunkyo-ku,Tokyo
Residence
T-6 KDX Azumabashi Residence 9-8,Azumabashi 1-chome,Sumida-ku,TokyoKDX Shimura Sakaue
T-7
16-5,Higashi-Sakashia 1-chome,Itabashi-ku,Tokyo
Residence
KDX Musashi Nakahara
18-22, Shimokodanaka 4-chome, Nakahara-ku,
T-10
Residence
Kawasaki-shi, Kanagawa
T-11 KDX Chiba Chuo Residence 2-17, Shindencho, Chuo-ku, Chiba-shi, China
KDX Kawaguchi Saiwai-cho
T-12
14-24, Saiwaicho 2-chome, Kawaguchi-shi, Saitama
Residence
T-13 KDX Residence Shirokane I
7-8, Shirokanedai 4-chome, Minato-ku, Tokyo

TBI

1,708

2,170

TBI

787

1,010

TBI

1,450

1,810

TBI

615

914

TBI

2,663

3,510

TBI

632

741

TBI

1,316

1,830

TBI

1,109

1,450

TBI

3,084

3,590

T-15 KDX Residence Shirokane II
KDX Residence MinamiT-16
aoyamaKDX Residence MinamiT-17
azabu
T-18 KDX Residence Shiba Koen

7-8, Shirokanedai 4-chome, Minato-ku, Tokyo

TBI

2,854

3,550

4-8, Minami-Aoyama 3-chome, Minato-ku, Tokyo

TBI

2,238

2,530

3-22, Minami-Azabu 2-chome, Minato-ku, Tokyo

TBI

2,072

2,720

4-16, Shiba 3-chome, Minato-ku, Tokyo

TBI

1,761

2,370

T-19 KDX Residence Azabu East

25-2, Higashi-Azabu 1-chome, Minato-ku, Tokyo

TBI

1,592

2,000

T-20 KDX Residence Takanawa

15-7, Takanawa 3-chome, Minato-ku, Tokyo

TBI

761

1,060

T-21 KDX Residence Nishihara
KDX Residence Daikanyama
T-22
II
T-23 KDX Residence Sendagaya
KDX Residence Nihombashi
T-24
Suitengu
KDX Residence Nihombashi
T-25
Hakozaki
KDX Residence HigashiT-26
shinjuku
T-27 KDX Residence Yotsuya
KDX Residence NishiT-28
shinjuku
T-29 KDX Residence Kagurazaka
KDX Residence Futako
T-30
Tamagawa
KDX Residence Komazawa
T-31
Koen
T-32 KDX Residence Mishuku

37-4, Nishihara 1-chome, Shibuya-ku, Tokyo

TBI

1,492

1,900

11-22, Ebisu Nishi 2-chome, Shibuya-ku, Tokyo

TBI

759

1,000

38-7, Sendagaya 3-chome, Shibuya-ku, Tokyo

TBI

638

844

41-6 Nihombashi Hakozakicho, Chuo-ku, Tokyo

TBI

3,154

4,020

38-1 Nihombashi Hakozakicho, Chuo-ku, Tokyo

TBI

1,156

1,430

1-9 Okubo 2-chome, Shinjuku-ku, Tokyo

TBI

3,236

4,090

22-50 Arakicho, Shinjuku-ku, Tokyo

TBI

2,297

2,870

18-15, Nishi-Shinjuku 7-chome, Shinjuku-ku, Tokyo

TBI

996

1,330

8-10, Tsukijicho, Shinjuku-ku, Tokyo

TBI

710

930

31-29, Seta 2-chome, Setagaya-ku, Tokyo

TBI

1,276

1,480

21-6 Komazawa 5-chome, Setagaya-ku, Tokyo

TBI

905

1,120

37-13, Mishuku 2-chome, Setagaya-ku, Tokyo

TBI

752

958

T-33 KDX Residence Yoga

34-21, Seta 5-chome, Setagaya-ku, Tokyo

TBI

695

864

T-34 KDX Residence Shimouma

21-8, Shimouma 1-chome, Setagaya-ku, Tokyo

TBI

598

765

T-35 Raffine Minami-magome
KDX Residence Yukigaya
T-36
OtsukaT-37 KDX Residence Denenchofu

24-8, Minami-Magome 5-chome, Ota-ku, Tokyo

TBI

1,241

1,450

15-13, Minami-Yukigaya 2-chome, Ota-ku, Tokyo

TBI

1,024

1,340

40-14, Denenchofu Honmachi, Ota-ku, Tokyo

TBI

1,062

1,280

T-38 KDX Residence Tamagawa
KDX Residence
T-39
Monzennakacho
KDX Residence
T-40
Okachimachi

9-17, Tamagawa 1-chome, Ota-ku, Tokyo

TBI

739

942

6-7, Kiba 3-chome, Koto-ku, Tokyo

TBI

766

1,010

28-4, Taito 2-chome, Taito-ku, Tokyo

TBI

870

1,060

No.

T-1

Name of property

KDX Daikanyama Residence

Location

7-1,Sarugakucho,Shibuya-ku,Tokyo

T-3

fiscal period(Note 1)

Residential Facilities

Tokyo Metropolitan Area

32

Book

Use

Area

No.

T-41
T-42
T-43
T-44
T-45
T-46

Name of property

KDX Residence Motoasakusa
KDX Residence Itabashi
HonchoKDX Residence Azusawa
KDX Residence Tobu
NerimaKDX Residence Yokohama
KannaiKDX Residence
Miyamaedaira

T-47 KDX Residence MachidaT-48 KDX Residence Kinshicho
KDX Residence Nihombashi
T-49
Hamacho
KDX Residence Nihombashi
T-50
Ningyocho
T-51 KDX Residence Jiyugaoka

Location

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)fiscal period(Note 1)

8-10, Motoasakusa 4-chome, Taito-ku, Tokyo

TBI

788

1,010

13-16, Yamatocho, Itabashi-ku, Tokyo

TBI

599

767

7-13, Azusawa 1-chome, Itabashi-ku, Tokyo

TBI

551

654

27-9, Kitamachi 1-chome, Nerima-ku, Tokyo

TBI

396

522

TBI

776

985

TBI

1,001

1,140

TBI

1,709

2,080

TBI

1,339

1,690

TBI

1,001

1,250

TBI

560

682

TBI

1,319

1,620

5-9, Bandaicho 3-chome, Naka-ku, Yokohama-shi,
Kanagawa
14-3, Miyamaedaira 3-chome, Miyamae-ku,
Kawasaki-shi, Kanagawa
13-32, Kamitsurumahoncho, Minami-ku,
Sagamihara-shi, Kanagawa
24-13, Midori 4-chome, Sumida-ku, Tokyo
33-4, Nishimbashi-Hamacho 3-chome, Chuo-ku,
Tokyo
8-5, Nihombashi-Horidomecho 1-chome, Chuo-ku,
Tokyo
11-27, Yakumo 3-chome, Meguro-ku, Tokyo

33

Book

Use

Area

No.

Name of property

Location

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)fiscal period(Note 1)

T-52 KDX Residence Togoshi
KDX Residence Shinagawa
T-53
SeasideT-54 KDX Residence Ojima

1-1, Togoshi 5-chome, Shinagawa-ku, Tokyo
6-7, Higashi-Shinagawa 3-chome, Shinagawa-ku,
Tokyo
8-4, Ojima 4-chome, Koto-ku, Tokyo

TBI

3,745

4,800

TBI

2,575

3,340

TBI

1,833

2,370

T-55 KDX Residence Oyama

8-8, Oyamakanaimachi, Itabashi-ku, Tokyo

TBI

2,638

3,310

T-56 KDX Residence Hanzomon

12-1, Kojimachi 2-chome, Chiyoda-ku, Tokyo

TBI

4,950

5,650

T-57 B-Site Akihabara
KDX Residence Kagurazaka
T-58
Dori
T-59 KDX Residence Sendagi

7, Kanda-Sudacho 1-chome, Chiyoda-ku, Tokyo

TBI

862

1,010

120-1, Yaraicho, Shinjuku-ku, Tokyo

TBI

1,380

1,940

43-17, Sendagi 3-chome, Bunkyo-ku, Tokyo

TBI

2,355

2,510

T-60 KDX Residence Seijo

16-25, Seijyo 4-chome, Setagaya-ku, Tokyo

TBI

1,421

1,600

T-61 KDX Residence Akihabara

13-7, Taito Higashi 2-chome, Taito-ku, Tokyo

TBI

1,249

1,560

T-62 KDX Residence Iriya

10-7, Iriya 1-chome, Taito-ku, Tokyo

TBI

1,062

1,400

T-63 KDX Residence Tachikawa

28-29, Akebonocho 2-chome, Tachikawa-shi, Tokyo
10, Mukaicho 1-chome, Tsurumi-ku, Yokohama-shi,
Kanagawa

TBI

2,994

3,650

TBI

1,149

1,500

KDX Residence Morishita
ChitoseT-66 KDX Residence Akasaka

5-3, Chitose 1-chome, Sumida-ku, Tokyo

TBI

1,106

1,300

13-11, Akasaka 6-chome, Minato-ku, Tokyo

TBI

1,191

1,760

T-67 KDX Residence Kanda

8-2, Uchikanda 2-chome, Chiyoda-ku, Tokyo

TBI

722

1,110

T-68 KDX Residence Ebisu
KDX Residence NishiT-69
magomeT-70 KDX Residence Nishi-azabu
KDX Residence Azabu
T-71
Sendaizaka
KDX Residence Waseda
T-72
Tsurumaki
KDX Residence Bunkyo
T-73
Yushima
KDX Residence
T-74
Kamishakujii

11-16, Ebisu Minami 1-chome, Shibuya-ku, Tokyo

TBI

2,939

4,320

4-4, Minami-Magome 6-chome, Ota-ku, Tokyo

TBI

1,170

1,260

5-10, Nishi-Azabu 3-chome, Minato-ku, Tokyo

TBI

1,240

1,710

1-7, Minami-Azabu 3-chome, Minato-ku, Tokyo

TBI

806

1,090

574-25, Waseda-Tsurumakimachi, Shinjuku-ku,
Tokyo

TBI

566

834

29-2, Yushima 2-chome, Bunkyo-ku, Tokyo

TBI

702

975

18-5, Kamishakujii 1-chome, Nerima-ku, Tokyo

TBI

657

820

T-75 KDX Residence Shin-otsuka 44-16, Higashi-Ikebukuro 5-chome, Toshima-ku,
Tokyo

TBI

775

993

TBI

906

1,160

T-77 KDX Residence Ryogoku

26-14, Shimotakaido 1-chome, Suginami-ku,
Tokyo
19-13, Kamesawa 2-chome, Sumida-ku, Tokyo

TBI

855

1,130

T-78 KDX Residence Toyosu

2-33, Toyosu 1-chome, Koto-ku, Tokyo

TBI

7,734

7,640

T-79 KDX Residence Asagaya

1-47-24, Asagayaminami, Suginami-ku, Tokyo
7-17-35, Hiyoshi, Kohoku-ku, Yokohama-shi,
Kanagawa

TBI

1,964

2,170

TBI

2,699

2,730

4-23-15, Kamikitazawa, Setagaya-ku, Tokyo

TBI

1,395

1,410

3-2-11, Noge, Setagaya-ku, Tokyo

TBI

1,141

1,230

1-9-8 Higashi-Asakusa, Taito-ku, Tokyo

TBI

709

737

3-25, Kasugamachi, Aoba-ku, Sendai-shi, Miyagi

TBI

936

1,320

24-28, Izumi 2-chome, Higashi-ku, Nagoya-shi, Aichi
49-6, Shinsakae 1-chome, Naka-ku, Nagoya-shi,
Aichi
7-15, Kawaracho 1-chome, Chuo-ku, Osaka-shi,
Osaka
2-43, Sakaemachi 3-chome, Takarazuka-shi, Hyogo
21-27, Shimizu 1-chome, Minami-ku, Fukuoka-shi,
Fukuoka
1000-4, Minami 2-jo 40-chome, Chuo-ku, Sapporoshi, Hokkaido

TBI

1,050

1,380

TBI

996

1,400

TBI

2,706

3,420

TBI

1,353

1,930

TBI

1,559

2,020

TBI

779

968

T-64 KDX Residence Tsurumi
T-65

Residential Facilities

Tokyo Metropolitan Area

T-76 KDX Residence SakurajosuiT-80 KDX Residence Hiyoshi
KDX Residence
Kamikitazawa
T-82 KDX Residence Kaminoge
KDX Residence HigashiT-83
Asakusa
R-2 KDX Jozenjidori Residence
T-81

Other Regional Area

R-3

KDX Izumi Residence

R-4

KDX Chihaya Residence

R-5
R-7

KDX Sakaisuji Hommachi
Residence
KDX Takarazuka Residence

R-8

KDX Shimizu Residence

R-9

KDX Residence Odori Koen

34

Book

Use

Area

No.

Name of property

Location

R-20 KDX Residence Saiin

2-35, Kikusui 4-jo 3-chome, Shiroishi-ku, Sapporoshi, Hokkaido
4-16, Hiragishi 4-jo 3-chome, Toyohira-ku, Sapporoshi, Hokkaido
15-42, Ichibancho 1-chome, Aoba-ku, Sendai-shi,
Miyagi45-2, Ichinazaka-Ishidome, Izumi-ku, Sendai-shi,
Miyagi13-22, Higashi-sakura 2-chome, Higashi-ku, Nagoyashi, Aichi
5-10, Higasi-sakura 1-chome, Higashi-ku, Nagoyashi, Aichi
4-27, Yokota 2-chome, Atsuta-ku, Nagoya-shi, Aichi
40-3, Nishi 7-jo Kakekoshicho, Shimogyo-ku, Kyotoshi, Kyoto
30-2, Saiintakadacho, Ukyo-ku, Kyoto-shi, Kyoto

R-21 KDX Residence Namba
KDX Residence NambaR-22
minami

6-16, Inari 1-chome, Naniwa-ku, Osaka-shi, Osaka
11-9, Shiokusa 3-chome, Naniwa-ku, Osaka-shi,
Osaka

KDX Residence Kikusui
R-10
Yojo
KDX Residence Toyohira
R-11
Koen
R-13 KDX Residence Ichiban-cho
R-15 KDX Residence Izumi Chuo
KDX Residence HigashiR-16
sakura I
KDX Residence HigashiR-17
sakura II
R-18 KDX Residence Jingumae
R-19 KDX Residence Nishi-oji

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)

TBI

786

1,020

TBI

467

549

TBI

503

706

TBI

456

613

TBI

2,248

2,540

TBI

863

1,020

TBI

797

1,030

TBI

780

938

TBI

419

512

TBI

1,359

1,650

TBI

1,281

1,570

fiscal period(Note 1)

35

Book

Use

Area

No.

R-24

Name of property

KDX Residence Ibaraki I・II
(Note 2)

KDX Residence ToyonakaR-25
minami
R-26 KDX Residence Moriguchi
R-27 KDX Residence Sannomiya
R-28 Ashiya Royal Homes
KDX Residence Funairi
R-29
Saiwai-cho
KDX Residence TenjinR-30
higashi II
R-32 KDX Residence Nishi Koen

Other Regional Area

Residential Facilities

KDX Residence Hirao JosuiR-33
machi
R-34 Melody Heim Gotenyama
R-35 Leopalace Flat Shin-sakae
R-36
R-37
R-38
R-39
R-40

KDX Residence Konan
YamateKDX Residence
Hommachibashi
KDX Residence Minamikusatsu
KDX Residence Ohori
Harbor View Tower
KDX Residence Minamisanjo

R-41 Serenite Kita-kyuhoji
Serenite Nishinomiya
R-42
HommachiR-43 KDX Residence Nishijin
R-44 Serenite Kobe Motomachi

Location

9-11, 9-12, Takehashicho, Ibaragi-shi, Osaka
7-22, Shonaihigashicho 2-chome, Toyonaka-shi,Osaka
12-12, Dainichihigasihmachi, Moriguchi-shi, Osaka
8-10, Ninomiyacho 4-chome, Chuo-ku, Kobe-shi,
Hyogo
20-10, Oharacho, Ashiya-shi, Hyogo
10-5, Funairisaiwaicho, Naka-ku, Hiroshima-shi,
Hiroshima
6-22, Chikukohonmachi, Hakata-ku, Fukuoka-shi,
Fukuoka
5-7, Minato 3-chome, Chuo-ku, Fukuoka-shi,
Fukuoka
10-17, Hiraojyosuimachi, Chuo-ku, Fukuoka-shi,
Fukuoka
6-1, Nagisa Nishimachi 1-chome, Hirakata-shi, Osaka
5-31, Shinsakae 1-chome, Naka-ku, Nagoya-shi,
Aichi
9-3, Moriminamimachi 1-chome, Higashinada-ku,
Kobe-shi, Hyogo

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)

TBI

1,289

1,424

TBI

682

860

fiscal period(Note 1)

TBI

518

666

TBI

1,079

1,210

TBI

1,458

1,920

TBI

553

703

TBI

646

873

TBI

728

876

TBI

738

913

TBI

423

531

TBI

3,496

4,490

TBI

969

1,130

2-14, Hommachibashi, Chuo-ku, Osaka-shi, Osaka

TBI

3,157

3,620

1-8, Minamikusatsu 1-chome, Kusatsu-shi, Shiga

TBI

1,987

2,410

TBI

4,547

5,220

TBI

919

1,690

TBI

1,278

1,580

TBI

643

744

TBI

1,747

1,690

TBI

2,492

2,600

TBI

7,263

7,300

2-18, Minato 1-chome, Chuo-ku, Fukuoka-shi,
Fukuoka
3-2, Minami 3-jo Nishi 8-chome, Chuo-ku, Sapporoshi, Hokkaido
3-15, Kitakyuhojicho 1-chome, Chuo-ku, Osaka-shi,
Osaka
5-26, Hommachi, Nishinomiya-shi, Hyogo
24-30, Nishijin 2-chome, Sawara-ku, Fukuoka-shi,
Fukuoka
1-22, Kaigandori 3-chome, Chuo-ku, Kobe-shi,
Hyogo

KDX Residence Shukugawa
R-45
Hills

7-1, Hinoikecho, Nishinomiya-shi, Hyogo

177,319

216,593

H-1

2-15-21 Kitakojiya, Ota-ku, Tokyo

TBI

1,093

1,120

3-26-24 Minamidai, Nakano-ku, Tokyo

TBI

1,772

1,780

924-2 Yokokawamachi, Hachioji-shi, Tokyo

TBI

3,783

3,760

TBI

1,094

1,120

SubtotalH-3

Irise Kamata/Yuseien
Nichii Home NakanoMinamidai
Joy Stage Hachioji

H-4

Yuimaru Hijirigaoka(Note 2)

H-5

Nichii Home Tama Plaza

H-2

Healthcare Facilities

Tokyo Metropolitan Area

2-22-4 Hijirigaoka, Tama-shi, Tokyo (Building A)
2-20-6 Hijirigaoka, Tama-shi, Tokyo (Building B)
2-21-2 Hijirigaoka, Tama-shi, Tokyo (Building C)
Nichii Home Tama Plaza

Other Regional Area

TBI

2,857

2,940

H-21 Plaisant Grand Ota tamagawa 2-19-4 Tamagawa,Ota-ku, Tokyo
1-11-7 Oyamagaoka Machida-shi, Tokyo (WestTsukui Sun-shine Machida
H-22 (Note2)
Tower)
1-11-8 Oyamagaoka Machida-shi, Tokyo (East Tower)
H-23 Serabi Ebisu
2-10-20, Mita, Meguro-ku, Tokyo
6-3-1 Tsukisamuchuodori, Toyohira-ku, Sapporo-shi,
H-6 TenHokkaido
13-7-10 Nishioka Sanjo, Toyohira-ku, Sapporo-shi,
H-7 Irise Nishioka
Hokkaido
H-8 Izarie Eniwa Building
2-1 Aioimachi, Eniwa-shi, Hokkaido

TBI

3,241

3,180

TBI

7,187

7,070

TBI

1,720

1,700

TBI

2,576

2,660

H-9

Sawayaka Sakura Nibankan

H-10 Activa Biwa(Note 2)

1-10-3 Oroshimachi, Akita-shi, Akita
6-16-16 Ogoto, Otsu-shi, Shiga
6-11-8 Ogoto, Otsu-shi, Shiga

TBI

834

857

TBI

1,608

1,740

TBI

954

991

TBI

6,429

6,560

36

Book

Use

Area

No.

Name of property

Location

Form ofownership

Appraisal value
at the end ofvalue(Millionyen)(Million yen)fiscal period(Note 1)

6-17-17 Ogoto, Otsu-shi, Shiga
285 Sarukura, Myodanicho, Tarumi-ku, Kobe-shi,
Hyogo

TBI

2,078

2,110

H-12 Granda Mondo Yakujin

10-10 Hayashidacho, Nishinomiya-shi, Hyogo

TBI

1,162

1,190

H-13 Excellent Nishinomiya

2-4-3 Sumiredai, Nishinomiya-shi, Hyogo

TBI

944

975

H-15 Excellent Kitano

10 Kitanohigashi, kobaicho, kita-ku, Kyoto-shi, Kyoto

TBI

761

780

H-16 Anesis Teradacho

1-4-24, Hayashiji, Ikuno-ku, Osaka-shi, Osaka

TBI

3,557

3,630

H-17 Rococo-riha

6-7 Hozan-cho, Toyonaka-shi, Osaka

TBI

2,096

2,170

H-18 Orage Suma

3-622-11, Wakakusa-cho, Suma-ku, Kobe-shi, Hyogo

TBI

2,827

2,810

H-19 Canadian Hill

2-3-1 Nagaminedai, Nada-ku, Kobe-shi, Hyogo

TBI

1,843

1,870

H-20 Anesis Hyogo

1-8-21, Yoshida-cho, Hyogo-ku, Kobe-shi, Hyogo
1-10-13,Mikage tsuka-machi, Higashi nada-ku, Kobeshi, Hyogo

TBI

1,422

1,440

TBI

1,201

1,410

TBI

1,328

1,380

54,37855,243

H-11

Sompo Care LAVIERE Kobe
Tarumi

H-24 Arute Ishiyagawa

Others

H-14 Gran Hills Ogawarako

57-2 Tachino Oura-aza, Tohokumachi-Oaza,
Kamikita-gun, Aomori

Subtotal

37

Book

Use

Area

No.

Tokyo
Metropolitan
Area
Other

T-9

Name of property

Cosmo Heim Motosumiyoshi

Location

5-1, Kizukigioncho, Nakahara-ku, Kawasaki-shi,
Kanagawa

Total

Form ofownership

RP

Appraisal value
at the end ofvalue(Millionyen)(Million yen)

1,798

1,840

233,496

273,676fiscal period(Note 1)

(Note1) “Appraisal value at the end of the fiscal period” is the appraisal value in a real property appraisal prepared, pursuant to the asset
appraisal techniques and standards in the Investment Corporation’s certificate of incorporation and the rules of the Investment Trusts
Association, Japan, by Japan Real Estate Institute, Daiwa Real Estate Appraisal Co., Ltd., JLL Morii Valuation & Advisory K.K. or
Tanizawa Sogo Appraisal Co., Ltd.
(Note 2) R-24 and H-4 consist of two buildings and H-4, H-10 consist of three buildings, book value and appraisal value are total amount ofeach value of the properties.

38

The overview of the rental business for the Individual Properties owned by the Investment Corporation are as follows.
14th(From August 1, 2018 to January 31, 2019)

15th(From February 1, 2019 to July 31, 2019)

Area
Use

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)
(%)
(%)

No.

Name of property

T-1

KDX Daikanyama Residence

1

100.0

160

2.1

1

98.7

164

2.1

T-3

KDX Odemma Residence
KDX Iwamoto-cho
Residence
KDX Bunkyo Sengoku
Residence
KDX Azumabashi Residence
KDX Shimura Sakaue
Residence
KDX Musashi Nakahara
Residence
KDX Chiba Chuo Residence
KDX Kawaguchi Saiwai-cho
Residence
KDX Residence Shirokane I

1

100.0

58

0.8

1

96.4

58

0.7

1

100.0

28

0.4

1

98.0

28

0.4

1

100.0

49

0.7

1

100.0

50

0.6

1

95.5

24

0.3

1

95.5

25

0.3

1

98.8

109

1.4

1

98.6

103

1.3

1

100.0

25

0.3

1

94.3

27

0.3

1

97.7

60

0.8

1

98.1

64

0.8

1

95.3

47

0.6

1

96.6

49

0.6

1

96.6

111

1.5

1

98.7

113

1.4

T-15 KDX Residence Shirokane II
KDX Residence MinamiT-16
aoyamaKDX Residence MinamiT-17
azabu
T-18 KDX Residence Shiba Koen

1

100.0

92

1.2

1

95.4

91

1.2

1

100.0

64

0.8

1

100.0

65

0.8

1

97.4

72

1.0

1

95.9

73

0.9

1

96.6

66

0.9

1

95.9

65

0.8

T-19 KDX Residence Azabu East

1

100.0

56

0.7

1

97.7

55

0.7

T-20 KDX Residence Takanawa

1

100.0

28

0.4

1

100.0

27

0.3

T-21 KDX Residence Nishihara
KDX Residence Daikanyama
T-22
II
T-23 KDX Residence Sendagaya
KDX Residence Nihombashi
T-24
Suitengu
KDX Residence Nihombashi
T-25
Hakozaki
KDX Residence HigashiT-26
shinjuku
T-27 KDX Residence Yotsuya
KDX Residence NishiT-28
shinjuku
T-29 KDX Residence Kagurazaka
KDX Residence Futako
T-30
Tamagawa
KDX Residence Komazawa
T-31
Koen
T-32 KDX Residence Mishuku

1

100.0

52

0.7

1

100.0

52

0.7

1

100.0

28

0.4

1

100.0

28

0.4

1

100.0

24

0.3

1

93.8

22

0.3

1

100.0

97

1.3

1

100.0

97

1.2

1

100.0

40

0.5

1

97.3

41

0.5

1

97.9

110

1.4

1

98.4

111

1.4

1

96.9

79

1.1

1

98.1

79

1.0

1

95.1

34

0.5

1

96.2

35

0.5

1

100.0

25

0.3

1

94.4

25

0.3

1

94.7

42

0.6

1

100.0

42

0.5

1

100.0

28

0.4

1

96.8

28

0.4

1

90.5

27

0.4

1

100.0

25

0.3

T-33 KDX Residence Yoga

1

97.5

23

0.3

1

100.0

24

0.3

T-34 KDX Residence Shimouma

1

100.0

21

0.3

1

100.0

21

0.3

T-35 Raffine Minami-magome
KDX Residence Yukigaya
T-36
OtsukaT-37 KDX Residence Denenchofu

1

100.0

41

0.5

1

100.0

41

0.5

1

98.7

38

0.5

1

95.9

39

0.5

1

97.2

37

0.5

1

100.0

38

0.5

T-38 KDX Residence Tamagawa
KDX Residence
T-39
Monzennakacho
KDX Residence
T-40
Okachimachi

1

98.2

28

0.4

1

98.3

29

0.4

1

100.0

27

0.4

1

100.0

29

0.4

1

98.1

30

0.4

1

100.0

32

0.4

(Note 3)

T-4
T-5
T-6
T-7
T-10
T-11
T-12
T-13

(Note 3)

Residential Facilities

Tokyo Metropolitan Area

39

14th
(From August 1, 2018 to January 31, 2019)

15th(From February 1, 2019 to July 31, 2019)

Area
Use

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)
(%)
(%)

No.

Name of property

T-41

KDX Residence Motoasakusa
KDX Residence Itabashi
HonchoKDX Residence Azusawa
KDX Residence Tobu
NerimaKDX Residence Yokohama
KannaiKDX Residence
Miyamaedaira
KDX Residence Machida

1

95.9

29

0.4

1

100.0

30

0.4

1

100.0

24

0.3

1

100.0

24

0.3

1

100.0

20

0.3

1

96.8

20

0.3

1

100.0

17

0.2

1

100.0

18

0.2

1

98.8

34

0.5

1

97.5

35

0.4

1

100.0

36

0.5

1

95.5

37

0.5

1

100.0

65

0.9

1

100.0

65

0.8

T-48 KDX Residence Kinshicho
KDX Residence Nihombashi
T-49
Hamacho
KDX Residence Nihombashi
T-50
Ningyocho
T-51 KDX Residence Jiyugaoka

1

100.0

44

0.6

1

93.7

44

0.6

1

100.0

30

0.4

1

100.0

30

0.4

1

100.0

19

0.3

1

100.0

20

0.3

1

93.6

38

0.5

1

100.0

41

0.5

(Note 3)

T-42
T-43
T-44
T-45
T-46
T-47

(Note 3)40

14th
(From August 1, 2018 to January 31, 2019)

Area
Use

No.

Name of property

15th(From February 1, 2019 to July 31, 2019)

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)(%)(%)
(Note 3)(Note 3)

Residential Facilities

Tokyo Metropolitan Area
Other Regional Area

T-52 KDX Residence Togoshi
KDX Residence Shinagawa
T-53
SeasideT-54 KDX Residence Ojima

1

99.3

122

1.6

1

98.0

122

1.5

1

97.1

85

1.1

1

98.3

87

1.1

1

95.7

61

0.8

1

97.4

64

0.8

T-55 KDX Residence Oyama

1

92.0

91

1.2

1

97.0

94

1.2

T-56 KDX Residence Hanzomon

1

98.8

131

1.7

1

98.3

135

1.7

T-57 B-Site Akihabara
KDX Residence Kagurazaka
T-58
Dori
T-59 KDX Residence Sendagi

1

100.0

23

0.3

1

100.0

23

0.3

1

100.0

51

0.7

1

98.6

53

0.7

1

97.8

65

0.9

1

95.1

66

0.8

T-60 KDX Residence Seijo

1

100.0

39

0.5

1

95.5

42

0.5

T-61 KDX Residence Akihabara

1

95.2

41

0.5

1

91.0

41

0.5

T-62 KDX Residence Iriya

1

100.0

39

0.5

1

100.0

40

0.5

T-63 KDX Residence Tachikawa

1

94.3

97

1.3

1

99.4

101

1.3

T-64 KDX Residence Tsurumi
KDX Residence Morishita
T-65
ChitoseT-66 KDX Residence Akasaka

1

98.4

52

0.7

1

98.4

53

0.7

1

96.2

39

0.5

1

98.1

39

0.5

1

96.4

39

0.5

1

100.0

40

0.5

T-67 KDX Residence Kanda

1

96.9

27

0.4

1

100.0

29

0.4

T-68 KDX Residence Ebisu
KDX Residence NishiT-69
magomeT-70 KDX Residence Nishi-azabu
KDX Residence Azabu
T-71
Sendaizaka
KDX Residence Waseda
T-72
Tsurumaki
KDX Residence Bunkyo
T-73
Yushima
KDX Residence
T-74
Kamishakujii
T-75 KDX Residence Shin-otsuka

1

99.0

94

1.2

1

97.3

94

1.2

1

89.1

30

0.4

1

98.1

33

0.4

1

100.0

37

0.5

1

94.3

40

0.5

1

100.0

26

0.4

1

100.0

27

0.3

1

100.0

22

0.3

1

97.6

21

0.3

1

100.0

24

0.3

1

100.0

25

0.3

1

97.8

23

0.3

1

97.7

24

0.3

1

100.0

22

0.3

1

100.0

22

0.3

T-76 KDX Residce Sakurajosui

1

93.0

29

0.4

1

95.9

29

0.4

T-77 KDX Residence Ryogoku

1

100.0

29

0.4

1

100.0

29

0.4

T-78 KDX Residence Toyosu

1

100.0

180

2.4

1

100.0

181

2.3

T-79 KDX Residence Asagaya

1

100.0

49

0.6

1

97.8

49

0.6

T-80 KDX Residence Hiyoshi
KDX Residence
T-81
Kamikitazawa
T-82 KDX Residence Kaminoge

1

93.6

73

1.0

1

97.2

77

1.0

－

－

－

－

1

92.3

34

0.4

－

－

－

－

1

100.0

26

0.3

T-83 KDX Residence Kaminoge

－

－

－

－

1

96.2

18

0.2

R-2

KDX Jozenji Dori Residence

1

97.0

51

0.7

1

87.2

49

0.6

R-3

KDX Izumi Residence

1

90.0

41

0.5

1

100.0

43

0.5

R-4

1

96.2

48

0.6

1

93.7

48

0.6

1

94.4

106

1.4

1

96.0

107

1.4

R-7

KDX Chihaya Residence
KDX Sakaisuji Hommachi
Residence
KDX Takarazuka Residence

1

100.0

59

0.8

1

94.3

58

0.7

R-8

KDX Shimizu Residence

1

96.2

72

1.0

1

93.4

71

0.9

R-9

KDX Residence Odori Koen

1

89.7

32

0.4

1

93.5

31

0.4

R-10 KDX Residence Kikusui Yojo

1

89.8

36

0.5

1

97.9

39

0.5

R-5

41

14th
(From August 1, 2018 to January 31, 2019)

Area
Use

No.

Name of property

R-11

KDX Residence Toyohira
Koen
KDX Residence Ichiban-cho
KDX Residence Kotodai(Note4)
KDX Residence Izumi Chuo
KDX Residence Higashisakura I
KDX Residence Higashisakura II
KDX Residence Jingumae

15th(From February 1, 2019 to July 31, 2019)

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)(%)(%)
(Note 3)

R-13
R-14
R-15
R-16
R-17
R-18

R-19 KDX Residence Nishi-oji(Note 3)

1

94.0

22

0.3

1

93.8

23

0.3

1

85.2

24

0.3

1

88.1

25

0.3

－

－

19

0.3

-

-

-

-

1

97.2

23

0.3

1

94.8

23

0.3

1

87.7

90

1.2

1

96.3

91

1.2

1

92.5

36

0.5

1

94.0

37

0.5

1

92.3

38

0.5

1

96.0

39

0.5

1

99.1

33

0.4

1

97.8

34

0.4

42

14th
(From August 1, 2018 to January 31, 2019)

Area
Use

No.

Name of property

15th(From February 1, 2019 to July 31, 2019)

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)(%)(%)
(Note 3)(Note 3)

Other Regional Area

Residential Facilities

R-20 KDX Residence Saiin

1

96.0

19

0.3

1

95.7

18

0.2

R-21 KDX Residence Namba
KDX Residence NambaR-22
minami
R-23 KDX Residence Shin-osaka

1

96.2

57

0.8

1

97.7

56

0.7

1

97.4

54

0.7

1

97.3

54

0.7

1

97.7

21

0.3

-

-

0

0.0

R-24 KDX Residence Ibaraki I・IIKDX Residence ToyonakaR-25
minami
R-26 KDX Residence Moriguchi

1

98.4

57

0.8

1

98.4

54

0.7

1

100.0

29

0.4

1

95.6

29

0.4

1

100.0

24

0.3

1

96.9

23

0.3

R-27 KDX Residence Sannomiya

1

98.9

38

0.5

1

97.8

39

0.5

R-28 Ashiya Royal Homes
KDX Residence Funairi
R-29
Saiwai-cho
KDX Residence TenjinR-30
higashi II
R-32 KDX Residence Nishi Koen
KDX Residence Hirao JosuiR-33
machi
R-34 Melody Heim Gotenyama

1

86.9

64

0.8

1

87.6

65

0.8

1

100.0

27

0.4

1

90.6

27

0.3

1

100.0

29

0.4

1

98.4

31

0.4

1

94.9

30

0.4

1

91.3

31

0.4

1

96.2

29

0.4

1

92.4

28

0.4

1

100.0

22

0.3

1

100.0

22

0.3

R-35 Leopalace Flat Shin-sakae
KDX Residence Koman
R-36
YamateKDX Residence
R-37
Hommachibashi
KDX Residence MinamiR-38
kusatsu
KDX Residence Ohori
R-39
Harbor View Tower
KDX Residence MinamiR-40
sanjo
R-41 Serenite Kita-kyuhoji
Serenite Nishinomiya
R-42
HommachiR-43 KDX Residence Nishijin

1

100.0

121

1.6

1

100.0

121

1.5

1

98.4

32

0.4

1

100.0

32

0.4

1

96.4

107

1.4

1

96.5

107

1.4

1

99.0

100

1.3

1

100.0

104

1.3

1

91.6

175

2.3

1

76.8

189

2.4

1

95.2

54

0.7

1

100.0

55

0.7

1

94.2

42

0.6

1

100.0

43

0.5

1

98.1

21

0.3

1

100.0

23

0.3

1

96.6

56

0.7

1

96.8

57

0.7

R-44 KDX Residence Hiyoshi
KDX Residence Shukugawa
R-45
Hills
Subtotal

1

98.6

73

1.0

1

97.2

76

1.0

1

93.3

203

2.7

1

93.9

206

2.6

6,147

80.8

6,283

79.2

116

96.7

118

96.4

1

100.0

1

100.0

1

100.0

1

100.0

H-3

Irise Kamata/Yuseien
Nichii Home NakanoMinamidai
Joy Stage Hachioji

1

1

100.0

H-4

Yuimaru Hijirigaoka

1

NonNon100.0
disclosure disclosure（Note5）（Note5）
100.0

1

100.0

H-5

Nichii Home Tama Plaza

1

100.0

1

100.0

H-21 Plaisant Grand Ota tamagawa

1

100.0

1

100.0

H-22 Tsukui Sun-shine Machida

－

－

－

－

1

NonNondisclosure
100.0 disclosure（Note5）（Note5）

H-23 Serabi Ebisu

－

－

－

－

1

100.0

H-6

Ten

1

100.0

1

100.0

H-7

Irise Nishioka

1

100.0

100.0

H-8

Izarie Eniwa Building

1

NonNon100.0 disclosure disclosure

1
1

100.0

H-9

Sawayaka Sakura Nibankan

1

100.0

1

100.0

1

100.0

1

100.0

H-1

Other Regional
Area

Healthcare Facilities

Tokyo Metropolitan Area

H-2

H-10 Activa Biwa

（Note5）（Note5）43

14th(From August 1, 2018 to January 31, 2019)

Area
Use

No.

Name of property

15th(From February 1, 2019 to July 31, 2019)

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)(%)(%)
(Note 3)(Note 3)

Sompo Care LAVIERE Kobe
H-11
Tarumi
H-12 Granda Mondo Yakujin

1

100.0

1

100.0

1

100.0

1

100.0

H-13 Excellent Nishinomiya

1

100.0

1

100.0

H-15 Excellent Kitano

1

100.0

1

100.0

H-16 Anesis Teradacho

1

100.0

1

100.0

H-17 Rococo-riha

1

100.0

1

100.0

H-18 Orage Suma

1

100.0

1

100.0

H-19 Canadian Hill

1

100.0

1

100.0

44

14th
(From August 1, 2018 to January 31, 2019)

Area

Use

No.

Name of property

15th(From February 1, 2019 to July 31, 2019)

Rental andRental andOccupancy
Ratio ofOccupancy
Ratio of
Number ofother
Number ofotherrate at therentalrate at therentaltenants at
operatingtenants at
operatingend ofrevenue to
end ofrevenue tothe end ofrevenues
the end ofrevenues
periodtotal rental
periodtotal rental
period(million
period(million(%)
revenues(%)
revenues(Note 1)
(Note 1)yen)
yen)
(Note 2)
(Note 2)(%)(%)
(Note 3)

Other
Other
Regional
Area
Healthcare Facilities

H-20 Anesis Hyogo

1

H-24 Arute Ishiyagawa－(Note 3)

NonNon100.0 disclosure disclosure（Note5）（Note5）

1

100.0

—

－

1

100.0

－

NonNondisclosure disclosure（Note5）

Tokyo
Metropolitan
Area
Other

1

1

100.0

Subtotal

21

100.0

1,415

18.6

24

100.0

1,605

20.2

Cosmo Heim
Motosumiyoshi (land withleasehold interest)

－

100.0

43

0.6

-

100.0

43

0.6

Total

137

97.7

7,605

100.0

142

97.5

7,933

100.0

H-14 Gran Hills Ogawarako

T-9（Note5）

NonNon100.0 disclosur disclosure（Note5）e（Note5）(Note1) Regarding residential, in the “number of tenants” column, if a master lease agreement has been executed with a master lease company,
1 is entered as the number of tenants. As of July 31, 2019, master lease agreements had been executed for all investment assets of theInvestment Corporation except for one case of ownership of leased land and Raffine Minami-magome; the “total” for the “number oftenants” is the sum of the master lease agreements for the properties (running number); and for the properties with no master leaseagreement, the number of end tenants is entered. There are a total of 14 master lease companies.
"Total number of tenants" of the healthcare facility lists the total number of tenants of the master lease contract pertaining to each asset
effective as of the end of July 2019.
(Note2) The “occupancy rate” = leased area / leasable area x 100. The “total” for the “occupancy rate” column is the occupancy rate for the
portfolio as a whole.
(Note3) “Rental and other operating revenues” is the sum of a property’s rental business income for each fiscal period.
(Note4) (R-14) KDX Residence Kotodai sold on January 24, 2019 and (R-23) KDX Residence Shin-Osaka sold on February 1, 2019.
(Note5) The Investment Corporation has not obtained consent from the tenant to release this information.

（Details of investment securities）
Investment securities as of July 31, 2019 are as follows.
Name of assets

Type

Unit

Unit value
Equity interests in TK
property fund with G.K.
Tropic Ⅲ as operator (Note 1)

Subordina
ted silent
partnershi
p equity
interest

Total(Note 1)

Assessed value(Million yen)Book value(Million yen)

Gain
(Loss) on
Remarks
valuation(Million yen)

(Note 2)

Value

Unit value

Value

-

-

2

-

2

-

-

-

-

2

-

2

-

-

TK property fund owns trust beneficiary interests in real estate for “Serabi Ebisu” and “Arute ishiyagawa”.The asset undermanagement was acquired by the Investment Corporation on June 3, 2019.

（Note 2） Assessed value indicates book value. Loss on valuation of investment securities of ¥5 million was recorded in the 15th

fiscal period.

（4）Details of specified transaction
The details of specified transaction at the end of 15th fiscal period are as follows.

45

Contact amount (Million yen)Classification

Over-the-counter transactions

Transaction(Note 1)

Interest rate swap
(Floating-rate to fixedrate interest)

Fair value(Million yen)Over 1 year (Note 1)
94,500(Note 2) (Note 3)

85,500△483

Total
94,50085,500－△483(Note 1) The interest rate swap contract amount, etc. is based on the assumed principal.
(Note 2) With respect to those meeting the requirements for special treatment under the accounting standards for financial products, the fairvalue is not listed.
(Note 3) Appraised at the price presented by the financial institution that is the other party in the transaction.

(5) Other assets
Real estate properties as well as beneficiary interests having real estate properties as major trust assets are
all set forth in (3) Details of portfolio assets above. There are not any other specified assets the Investment
Corporation owns at the end of 15th fiscal period except for those mentioned in (3) above.
(6) Asset ownership per country or region
There is no relevant information for countries and regions other than Japan.

4. Capital expenditures for property(1)Planned capital expenditures

The table below shows major capital expenditures for renovations, repairs and other projects that are planned for the
16 the fiscal period ending January 31, 2019. These expenditures are for real estate owned by the Investment
Corporation and real estate in trusts in which the Investment Corporation owns trust beneficiary rights. These planned
projects may include some expenditure that will be recorded as expenses rather than capital expenditures foraccounting purposes.

No.

Name of property

T-17

KDX Residence Minami-azabu

T-24
H-6
R-45
T-49
T-16
T-41
R-11
R-11

Location

Minato-ku,Tokyo
Chuo-ku,Tokyo
Sapporo-shi,
Hokkaido

Purpose

Major renewal
construction
KDX Residence Nihombashi
Major renewal
Suitengu
construction
Major renewal
Tenconstruction
Major renewal
NishinomiyaKDX Residence Shukugawa Hills
construction (3rdku, Hyogophase)KDX Residence Nihombashi
Chuo-ku,
Major renewal
HamachoTokyo
construction
Minato-ku, Major renewal
KDX Residence Minami-aoyama
Toktoconstruction
Taito-ku,
Major renewal
KDX Residence Moto-asakusa
Tokyo
construction
Water heater
Sapporo-shi,
KDX Residence Toyohira Koen
replacement
Hokkaido
construction
Sapporo-shi, Replacement of
KDX Residence Toyohira Koen
Hokkaido
common utility

Scheduled

From August 2019
To January 2020
From August 2019
To January 2020
From August 2019
To January 2020

Planned amount of capital
expenditure(Millions of yen)
Payment Total of
Total for the advanced
period payment
78

－

－

70

－

－

68

－

－

56

－

－

45

－

－

38

－

－

35

－

－

From August 2019
To January 2020

5

－

－

From August 2019
To January 2020

4

－

－

From August 2019
To January 2020
From August 2019
To January 2020
From August 2019
To January 2020
From August 2019
To January 2020

（2）Capital expenditures during the 15th fiscal period
The table below shows major capital expenditures for renovations, repairs and other projects in the 15th fiscal period
ended July 2019. The construction cost for the period amounted to 912 million yen, consisting of 612 million yen of
capital expenditures and 300 million yen of repair and maintenance expenses.

46

No.

Name of property

Location

PurposeCapital expenditures(Million yen)

Term

H-3

Joy Stage Hachioji

Hachiojishi,Tokyo

Major renewal
construction

From February
2019
To July 2019

121

R-9

KDX Residence Odori Koen

Sapporoshi,
Hokkaido

Major renewal
construction

From March 2019
To July 2019

51

T-19

KDX Residence Azabu East

Minato-ku, Major renewal
Tokyo
construction

T-21

KDX Residence Nishihara

Shibuya-ku, Major renewal
Tokyo
construction

H-19

Canadian Hill

Kobe-shi,
Hyogo

T-40

KDX Residence Okachimachi(3)

Equipment replacement
construction

Taito-ku, Major renewal
Tokyo
construction
Other
Total

From February
2019
To July 2019
From April 2019
To July 2019
From February
2019
To June 2019
From May 2019
To July 2019

46
40
39
32
279
612

Reserved funds for long-term maintenance plan

In accordance with its long-term repair and maintenance plan for each property, the Investment Corporation sets aside,from the cash flow during the 15th fiscal period, repair and maintenance reserves designed to finance payment of future
medium- to long-term major repair and maintenance work.
(Million yen)
Term

11th
From Feb. 1, 2017
to Jul. 31, 2017

12th
From Aug. 1, 2017
to Jan. 31, 2018

13th
From Feb. 1, 2018
to Jul. 31, 2018

14th
From Aug. 1, 2018
to Jan. 31, 2019

15th
From Feb. 1, 2019
to Jul. 31, 2019

1,161

1,295

1,384

732

831

151

263

302

101

71

17

174

954

2

4

1,295

1,384

732

831

898

Reserve balance at the
beginning of the period
Amount of reserve
during the period
Reversal of reserves
during the period
Amount carried forward
to the next period

5.

Expenditures and liabilities(1) Details of asset management expenses(in thousands of yen)

Item

14th
From August 1, 2018
to January 31, 2019

15th
From February 1, 2019
to July 31, 2019(ⅰ) Asset management fees (Note)

513,065

562,274(ⅱ) Asset custody fees

11,985

13,404(ⅲ) Administrative service fees

41,72345,950(ⅳ) Directors’ compensation

8,100

8,100

(ⅴ) Other operating expenses

240,701

231,968

815,575

861,697

Total（Note）There are other asset management fees in addition to the amount set forth above, and asset management fees pertaining to property
acquisitions (14th fiscal period: 285,477 thousand yen and 15th fiscal period: 128,443 thousand yen) and sold fee pertaining to property
sold (14th fiscal period: 3,652 thousand yen and 15th fiscal period: 3,450 thousand yen).

(2)

Status of Interest-bearing debt

Borrowings on a financial institution basis as of July 31, 2019 are as follows.

47

Classification

Drawdown
Date

LenderBalance at theBalance

beginningat the endof period(mln yen)of period(mln yen)

Averageinterest
rate(Note 1)

Payment
due date(Note 2)

Debt
Financing
MethodUse

Remarks

Short-term loans payable

Sumitomo Mitsui Banking Corporation

July 31, 2018

1,250

-

0.412

Mizuho Bank, Ltd.

July 31, 2018

800

-

0.412

Sumitomo Mitsui Banking Corporation

February 28, 2019

-

1,000

0.413

Sumitomo Mitsui Banking Corporation

July 31, 2019

-

1,000

0.374

Sumitomo Mitsui Banking Corporation

July 31, 2019

-

500

0.324

Repaymentof principal
Unsecured/
February 28, 2020 in full on （Note 4） Unguarante
maturityed
July 31, 2020
date
July 31, 2020

2,050

2,500

Subtotal

July 31, 2019
July 31, 2019

Current portion of long-term borrowings

MUFG Bank, Ltd.

November 28, 2014

1,500

1,500

0.689

November 30, 2019

Sumitomo Mitsui Banking Corporation

August 22, 2017

1,000

-

0.486

February 28, 2019

MUFG Bank, Ltd.

August 22, 2017

500

-

0.486

February 28, 2019

Sumitomo Mitsui Banking Corporation

July 30, 2018

500

-

0.362

July 31, 2019

Shinsei Bank, Ltd.

July 30, 2018

500

-

0.362

July 31, 2019

Sumitomo Mitsui Banking Corporation

1,500

1,500

MUFG Bank, Ltd.

1,400

1,400

Mizuho Bank, Ltd.

900

900

Shinsei Bank, Ltd.

500

500

400

400

0.437

1月31, 2020

Sumitomo Mitsui Trust Bank, Limited.

300

300

Mizuho Trust & Banking Co., Ltd.

300

300

Aozora Bank, Ltd.

200

200

THE BANK OF FUKUOKA, LTD.

200

200

1,750

1,750

1,750

1,750
0.729

July 29, 2020

Resona Bank, Ltd.

August 2, 2018

Shinsei Bank, Ltd. (Note 5)
Sumitomo Mitsui Banking Corporation（Note 5）

MUFG Bank, Ltd.

(Note 5)

1,000

1,000

Mizuho Bank, Ltd. (Note 5)

500

500

Resona Bank, Ltd. (Note 5)

500

500

Mizuho Trust & Banking Co., Ltd. (Note 5)

500

500

Subtotal

15,70013,200July 29, 2015

Repaymentof principal
Unsecured/in full on （Note 4） Unguarante
maturity
ed
date

48

Classification

LenderDrawdown
Date

Balance at theBalance

beginningat the endof period(mln yen)of period(mln yen)

Averageinterest
rate(Note 1)

Payment
due date(Note 2)

MUFG Bank, Ltd.

January 31, 2014

1,000

1,000

1.109

Sumitomo Mitsui Banking Corporation

January 31, 2014

1,000

1,000

1.221

July 31, 2021

Aozora Bank, Ltd.

March 28, 2014

1,350

1,350

1.183

March 31, 2021

Sumitomo Mitsui Banking Corporation

April 30, 2014

2,000

2,000

1.267

April 30, 2022

Aozora Bank, Ltd.

April 30, 2014

1,500

1,500

1.267

April 30, 2022

MUFG Bank, Ltd.

April 30, 2014

1,000

1,000

1.267

April 30, 2022

Resona Bank, Ltd.

April 30, 2014

1,000

1,000

1.267

April 30, 2022

Sumitomo Mitsui Banking Corporation

1,100

1,100

MUFG Bank, Ltd.

1,100

1,100

Mizuho Bank, Ltd.

600

600

350

350

0.916

August 7, 2021

Resona Bank, Ltd.

300

300

Mizuho Trust & Banking Co., Ltd.

300

300

1,000

1,000

0.996

August 7, 2021

Sumitomo Mitsui Banking Corporation

400

400

MUFG Bank, Ltd.

400

400

Mizuho Bank, Ltd.

300

300

200

200

1.254

August 7, 2023

Mizuho Trust & Banking Co., Ltd.

200

200

Aozora Bank, Ltd.

150

150

Aozora Bank, Ltd.

Development Bank of Japan Inc. (Note 3)

Resona Bank, Ltd.

August 7, 2014

August 7, 2014

August 7, 2014

Debt
Financing
MethodUse

Remarks

January 31, 2021

Long-term borrowings

Development Bank of Japan Inc. (Note 3)

August 7, 2014

500

500

1.320

August 7, 2023

Sumitomo Mitsui Banking Corporation

August 29, 2014

600

600

0.945

August 31, 2021

MUFG Bank, Ltd.

August 29, 2014

600

600

0.945

August 31, 2021

Aozora Bank, Ltd.

August 29, 2014

500

500

0.945

Mizuho Bank, Ltd.

November 14, 2014

950

950

1.083

Sumitomo Mitsui Banking Corporation

November 28, 2014

2,000

2,000

0.804

Sumitomo Mitsui Banking Corporation

February 5, 2015

1,200

1,200

0.875

August 31, 2021 Repayment
Unsecured/
November 30, 2022 of principal
in full on （Note 4） UnguarantNovember 30, 2020 maturity
eed
date
January 31, 2022

MUFG Bank, Ltd.

February 5, 2015

1,200

1,200

1.105

January 31, 2024

Aozora Bank, Ltd.

April 30, 2015

2,000

2,000

0.875

April 30, 2022

Resona Bank, Ltd.

April 30, 2015

1,500

1,500

0.987

April 30, 2023

MUFG Bank, Ltd.

April 30, 2015

2,000

2,000

1.100

April 30, 2024

Sumitomo Mitsui Banking Corporation

April 30, 2015

1,000

1,000

1.265

April 30, 2025

1,100

1,100

1,100

1,100

1,000

1,000

1.115

July 29, 2022

300

300

1,000

1,000

Shinsei Bank, Ltd.
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.

July 29, 2015

Mizuho Bank, Ltd.
Sompo Japan Nipponkoa Insurance Inc.
Aozora Bank, Ltd.

August 31. 2015

300

300

0.678

August 31, 2020

Resona Bank, Ltd.

August 31, 2015

1,100

1,100

0.923

August 31, 2022

Mizuho Trust & Banking Co., Ltd.

August 31, 2015

700

700

0.923

August 31, 2022

Sumitomo Mitsui Trust Bank, Limited.

August 31, 2015

950

950

1.047

August 31, 2023

MUFG Bank, Ltd.

August 31, 2015

1,700

1,700

1.169

August 31, 2024

Mizuho Bank, Ltd.

August 31, 2015

950

950

1.169

August 31, 2024

Sumitomo Mitsui Banking Corporation

August 31, 2015

2,000

2,000

1.345

August 31, 2025

Development Bank of Japan Inc. (Note 3)

August 31, 2015

1,000

1,000

1.193

August 31, 2024

MUFG Bank, Ltd.

October 27, 2015

300

300

0.624

October 27, 2020

MUFG Bank, Ltd.

October 27, 2015

1,000

1,000

1.156

April 27, 2025

MUFG Bank, Ltd.

April 28, 2016

1,000

1,000

0.819

April 28, 2025

Sumitomo Mitsui Banking Corporation

April 28, 2016

2,500

2,500

0.903

April 30, 2026

MUFG Bank, Ltd. (Note 3)

August 1, 2016

1,000

1,000

0.660

July 31, 2025

49

Classification

LenderDrawdown
Date

Balance at theBalance

beginningat the endof period(mln yen)of period(mln yen)

Averageinterest
rate(Note 1)

Payment
due date(Note 2)

Debt
Financing
MethodUse

Remarks

Long-term borrowings

Mizuho Bank, Ltd. (Note 3)

August 30, 2016

1,500

1,500

0.816

August 31, 2026

Aozora Bank, Ltd.

August 31, 2016

1,000

1,000

0.713

August 31, 2024

Sumitomo Mitsui Trust Bank, Limited.

August 31, 2016

1,000

1,000

0.797

August 31, 2025

Resona Bank, Ltd.

August 31, 2016

500

500

0.797

August 31, 2025

MUFG Bank, Ltd.(Note 3)

August 31, 2016

2,000

2,000

0.670

August 31, 2025

Mizuho Trust & Banking Co., Ltd. (Note 3)

August 31, 2016

500

500

0.751

August 31, 2025

Sumitomo Mitsui Banking Corporation

August 31, 2016

3,000

3,000

0.906

August 31, 2026

Development Bank of Japan Inc.(Note 3)

November 1, 2016

1,000

1,000

0.773

October 31, 2025

Resona Bank, Ltd.

August 22, 2017

1,000

1,000

0.900

August 22, 2027

Sumitomo Mitsui Trust Bank, Limited.

August 22, 2017

1,000

1,000

0.900

August 22, 2027

Shinsei Bank, Ltd.

August 22, 2017

1,000

1,000

0.900

August 22, 2027

Mizuho Trust & Banking Co., Ltd. (Note 3)

August 22, 2017

1,200

1,200

0.928

August 22, 2027

Development Bank of Japan Inc.(Note 3)

August 22, 2017

1,000

1,000

0.928

August 22, 2027

Mizuho Bank, Ltd.(Note 3)

August 22, 2017

500

500

0.928

August 22, 2027

THE BANK OF FUKUOKA, LTD. (Note 3)

August 22, 2017

500

500

0.928

August 22, 2027

Sumitomo Mitsui Banking Corporation

August 31, 2017

1,500

1,500

0.501

February 28, 2023

MUFG Bank, Ltd.

August 31, 2017

1,500

1,500

0.501

February 28, 2023

Aozora Bank, Ltd.

August 31, 2017

1,500

1,500

0.582

February 29, 2024

Sumitomo Mitsui Banking Corporation

August 31, 2017

1,000

1,000

0.582

February 29, 2024

MUFG Bank, Ltd.

August 31, 2017

1,000

1,000

0.582

February 29, 2024

Mizuho Bank, Ltd.

August 31, 2017

500

500

0.624

August 31, 2024

Mizuho Trust & Banking Co., Ltd. (Note 3)

August 31, 2017

500

500

0.661

August 31, 2024

Sumitomo Mitsui Banking Corporation

August 31, 2017

1,500

1,500

0.665

February 28, 2025

Resona Bank, Ltd.

August 31, 2017

1,000

1,000

0.749

Sumitomo Mitsui Trust Bank, Limited.

August 31, 2017

1,000

1,000

0.749

Sumitomo Mitsui Banking Corporation

July 30, 2018

1,000

1,000

0.409

Shinsei Bank, Ltd.

July 30, 2018

1,000

1,000

0.409

February 28, 2026 Repayment
Unsecured/
February 28, 2026 of principal
in full on （Note 4） Unguarant
July 31, 2021
maturityeed
dateJuly 31, 2021

MUFG Bank, Ltd.

July 30, 2018

500

500

0.409

July 31, 2021

Mizuho Bank, Ltd.

July 30, 2018

500

500

0.409

July 31, 2021

Nippon Life Insurance Company (Note 3)

July 30, 2018

500

500

0.900

January 30, 2027

Sumitomo Mitsui Banking Corporation

1,500

1,500

MUFG Bank, Ltd.

1,400

1,400

Mizuho Bank, Ltd.

900

900

Development Bank of Japan Inc.

500

500

Nippon Life Insurance Company

500

500

400

400

0.799

February 2, 2026

Shinsei Bank, Ltd.

400

400

Sumitomo Mitsui Trust Bank, Limited.

400

400

Mizuho Trust & Banking Co., Ltd.

400

400

Aozora Bank, Ltd.

300

300

THE BANK OF FUKUOKA, LTD.

300

300

Resona Bank, Ltd.

August 2, 2018

Sumitomo Mitsui Banking Corporation

August 31, 2018

1,000

1,000

0.509

August 31, 2022

MUFG Bank, Ltd.

August 31, 2018

400

400

0.509

August 31, 2022

Development Bank of Japan Inc. (Note 3)

August 31, 2018

1,600

1,600

0.498

August 31, 2022

Sumitomo Mitsui Banking Corporation

August 31, 2018

1,200

1,200

0.592

August 31, 2023

Aozora Bank, Ltd.

August 31, 2018

1,000

1,000

0.592

August 31, 2023

MUFG Bank, Ltd.

August 31, 2018

800

800

0.592

August 31, 2023

Sumitomo Mitsui Banking Corporation

August 31, 2018

1,050

1,050

0.914

February 28, 2027

Resona Bank, Ltd.

August 31, 2018

500

500

0.914

February 28, 2027

Sumitomo Mitsui Trust Bank, Limited.

August 31, 2018

500

500

0.914

February 28, 2027

50

Classification

Drawdown
Date

LenderBalance at theBalance

beginningat the endof period(mln yen)of period(mln yen)

Averageinterest
rate

Payment
due date(Note 1)
(Note 2)

Debt
Financing
MethodUse

Remarks

Mizuho Trust & Banking Co., Ltd.

August 31, 2018

500

500

0.914

February 28, 2027

Mizuho Bank, Ltd.

August 31, 2018

250

250

0.914

February 28, 2027

Development Bank of Japan Inc. (Note 3)

August 31, 2018

1,400

1,400

0.884

February 28, 2027

August 31, 2018

800

800

0.825

February 28, 2027

Nippon Life Insurance Company (Note 3)

September 28, 2018

700

700

0.920

September 30, 2026

Shinsei Bank, Ltd.

September 28, 2018

1,000

1,000

1.031

Sumitomo Mitsui Trust Bank, Limited.

September 28, 2018

800

800

1.031

Mizuho Trust & Banking Co., Ltd.

September 28, 2018

500

500

1.031

MUFG Bank, Ltd.

February 28, 2019

-

500

0.438

September 30, 2028 Repayment
Unsecured/
September 30, 2028 of principal
in full on （Note 4） Unguarant
September 30, 2028 maturityeed
dateAugust 31, 2020

Mizuho Trust & Banking Co., Ltd.

June 3, 2019

-

400

0.363

November 30, 2024

Mizuho Bank, Ltd. (Note 3)

June 3, 2019

-

2,000

0.330

May 31, 2025

Shinsei Bank, Ltd.

June 3, 2019

-

500

0.484

November 30, 2025

Shinsei Bank, Ltd.

July 31, 2019

-

500

0.272

January 31, 2023

Mizuho Bank, Ltd.

July 31, 2019

-

800

0.299

July 31, 2023

Subtotal

100,500

105,200

Total

118,250

120,900

MUFG Bank, Ltd.

(Note 3)Long-term borrowings（Note 1）All debts except for the following Note 3 are borrowing at a floating rate.
（Note 2）Average interest rates are the weighted average during the period and figures are rounded to the nearest third decimal places. Also, with regard
to borrowings for which interest rate swap transactions and other derivative transactions were implemented in order to hedge the interest rate
volatility risk, the weighted average interest rates taking into consideration the effects of the interest rate swaps and other derivatives are indicated.
（Note 3）Borrowings is applied at a fixed rate.
（Note 4）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 5）Debts included in the classification of current portion of long-term loans payable from the 15th fiscal period and in of long-term loans payablein the 14th fiscal period.

（3）Investment corporation bonds
Outstanding Investment corporation bonds as of July 31, 2019 are as follows.2019
SeriesFirst Series Unsecured
Investment Corporation
Bonds
Second Series Unsecured
Investment Corporation
Bonds
Third Series Unsecured
Investment Corporation
Bonds
Fourth Series Unsecured
Investment Corporation
Bonds
Fifth Series Unsecured
Investment Corporation
Bonds
Total

Date of issue

Balance atBalance at thethe beginningend of periodof period(mln yen)(mln yen)Interest rate（%）

Repayment dateAugust 30, 2016

1,000

1,000

0.200

August 30, 2021

August 30, 2016

1,000

1,000

0.540

August 28, 2026

August 30, 2016

1,000

1,000

0.800

November 30,
2018

1,000

1,000

0.410

November 30,
2018

1,000

1,000

0.850

5,000

5,000

Repayment
methodRepaymentof principal
August 30, 2028 in full on
maturity
date
November 30,
2023

Use

Remarks（Note 1）

（Note 2）

November 30,
2028（Note 1）Investment corporation bonds were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate and repayment of debts.
（Note 2）Ranking pari passu among the specified investment corporation bonds.

（4）Status of Short-Term Investment Corporation Bonds
Not applicable（5）Investment Unit warrants
Not applicable51

6．Acquisitions and sales during the 15th fiscal period(1) Acquisitions and sales of real estate properties and asset-backed securities, etc., infrastructure assets andinfrastructure-related assets
Type

No.

Name

Acquisition
Acquisition
price
Acquisition(Million yen) Sales date
date

Sale
Book value
Sales priceGain and loss
(Million yen) (in millions) (Million yen)
(Million yen) （Note 2）（Note 1）
（Note 2）

(Note 1)

Trust BeneficiaryInterest

T-81

KDX Residence Kamikitazawa

Trust BeneficiaryInterest
Trust BeneficiaryInterest

T-82

KDX Residence Kaminoge

T-83

KDX Residence HigashiAsakusa

Trust BeneficiaryInterest
Trust BeneficiaryInterest
Trust BeneficiaryInterest
Trust BeneficiaryInterest

R-23

February 1,
2019
February 1,
2019
February 21,
2019

1,360

－

－

－

－

1,111

－

－

－

－

687

－

－

－

－

690

482

203

1,
－ February
2019

KDX Residence Shin-Osaka

－

H-22

Tsukui Sun-shine Machida

March 1,
2019

6,934

－

－

－

－

H-23

Serabi Ebisu

June 3, 2019

1,690

－

－

－

－

H-24

Arute Ishiyagawa

June 3, 2019

1,061

－

－

－

－

（Note 1）The acquisition price and Sale price are the amount identified in the purchase and sale agreement of each trust beneficiary interest(excluding expenses required for the acquisition and taxes, etc.), rounded down to the nearest whole million yen.
（Note 2）Book value and Gain and loss are rounded down to the nearest whole million yen.

（2）Acquisitions and Sale of other assets
Other than the foregoing real estate properties, asset-backed securities, infrastructure assets and other infrastructurerelated assets, major assets in general are bank deposits or bank deposits within trust assets.

（3）Appraisals of Specified Assets(ⅰ) Real estate, etc.

Transaction

Type

No.

Property nameAcquisition
Appraisal
Date ofprice or Salevalue
acquisition
price(Million yen)or sale(Million yen)
(Note 2)

Appraiser

As ofAppraisal
date(Note 1)

Trust
Acquisition Beneficiary T-81
Interest
Trust
Acquisition Beneficiary T-82
Interest
Trust
Acquisition Beneficiary T-83
Interest
Trust
Sale
Beneficiary R-23
Interest
Trust
Acquisition Beneficiary H-22
Interest
Trust
Acquisition Beneficiary H-23
Interest
Trust
Acquisition Beneficiary H-24
Interest

KDX Residence
Kamikitazawa

February 1,
2019

1,360

1,400

Japan Real Estate
Institute

September
1, 2018

KDX Residence Kaminoge

February 1,
2019

1,111

1,200

Japan Real Estate
Institute

December
1, 2018

KDX Residence HigashiAsakusa

February21, 2019

687

727

Japan Real Estate
Institute

December
1, 2018

KDX Residence Shin-Osaka

February 1,
2019

690

578

Japan Real Estate
Institute

July 31,2018

Tsukui Sun-shine Machida

March 1,
2019

6,934

7,070

Japan Real Estate
Institute

December
1, 2018

Serabi Ebisu

June 3,
2019

1,690

1,700

JLL Morii Valuation& Advisory K.K.

December
1, 2018

Arute Ishiyagawa

June 3,
2019

1,061

1,430

The Tanizawa Sogo
Appraisal Co., Ltd.

December
1, 2018（Note 1）“Acquisition price” and “Sale price” represent the purchase and Sales amount (excluding acquisition costs and consumption taxes)of each property or beneficiary right of real estate in trust as stated in the Sales and Purchase Agreement.
（Note 2）“Appraisal value” of specific assets above was calculated in accordance with the guideline of “Real Estate Appraisal Standards,
Chapter 3, Appraisal of Securitized Real Estate.” For the Appraisal value of H-22 Tsukui Sun-shine Machida, the totals of the Eastand West Buildings are included.

52

(ⅱ) Others
With regard to transactions and contracts entered by the Investment Corporation whose values shall be investigatedbased on the Act on Investment Trusts and Investment Corporations, Crowe Toyo & Co. performs an investigationof transactions. For the fiscal period from February 1, 2019 to July 31, 2019, the transactions subject to suchinvestigation were six interest rate swap transactions, for which the Investment Corporation received reports from
Crowe Toyo & Co. For this purpose, investigation was performed with respect to details of the interest swap
contracts, such as the name of counter parties, contract amounts, or the period of transactions.
This survey is not a part of the audit for financial statements, and there is no guarantee of fairness of the price andinternal management system.

（4）Transactions with Related-Party(ⅰ) Transactions
Category
Total amountTransaction with related-party
GK KSLF5
Total

Transaction price (million yen)
Acquisition price（Note 2）
12,844 million yen
6,934 million yen
6,934 million yen

Sale price（Note 2）
690 million yen（54.0％）（54.0％）

－
－

（－％）
（－％）

(ⅱ) Amounts of Fees Paid
Category
Rent paid

Total paid fees（A）
22 million yen

Related-Party Transactions
Paid toPaid amount (B)GK KRF17
1 million yen

Ratio to total（B）/（A）
7.3％(Note 1) A related-party, etc. is a defined as a related-party, etc. of the asset management company having executed an asset management
entrustment agreement with the Investment Corporation provided in Article 123 of the Order for Enforcement of the Act on Investment
Trusts and Investment Corporations and Article 26, Item 27 of Rules on asset management reports, pertaining to investment trusts andinvestment corporations of the Investment Trusts Association, Japan.
(Note 2）‟Acquisition price” and “Sale price” excluded expenses related to aqcuisition or sale and taxes and dues.
(Note 3） The amount of payments including expenses for repair work of which orders were placed to related-party, etc. during the 14th fiscal
period other than the above paid fees is as follows.
Kenedix Engineering, Inc.
Construction costs recorded as capital expenditure: 43 million yen
Repair costs: 3 million yen（5）Transactions with asset management company related to Concurrent Operations Carried Out by the
Asset Management Company
There is no transaction with the Asset Management Company, KFM, regarding to the Type II Financial Instruments
Business, and Building Lots and Buildings Transaction Business. Furthermore, KFM does not concurrently engage inany of Type I Financial Instruments Business, Real Estate Specified Joint Business.

53

7．Accounting(1)

Assets, liabilities, principal and profit/loss

Please see the Balance Sheet, the Statement of Income and Retained Earnings, the Statement of Unitholders’ Equity,
Notes and the Calculation pertaining to Distributions below.

(2)

Change to calculation of depreciation amountNot applicable(3)

Change to real estate and other infrastructure assets appraisal method
Not applicable(4) Disclosure pertaining to investment trust beneficial right securities, etc.
The status of investment units held by the Asset management Company of the Investment Corporation (Kenedix
Real Estate Fund Management, Inc) is as follows.

(ⅰ) Acquisitions
Date of acquisition

Number of units

Number of disposal
units

Number of units held

March 1, 2018 (Note)

1

-

1

Accumulated total

1

-

1

(Note) The Asset Management Company acquired one investment unit of Japan Senior Living Investment Corporation on July 21, 2015.
Following the merger with the Investment Corporation, the Asset Management Company acquired its investment units on March 1,
2018, which is the effective date of the merger.

(ⅱ) Ownership

13th Fiscal Period
From February 1, 2018 to July 31, 2018
14th Fiscal Period
From August 1, 2018 to January 31, 201915th Fiscal Period
From February 1, 2019 to July 31, 2019

(5)

Number of units
held at end of fiscal
period（Unit）

Asset held at theend of fiscal period（Million yen）

Ratio to total numberof units issued (%)

1

0

0.0

1

0

0.0

1

0

0.0

Disclosure pertaining to overseas real estate holding corporations
Not applicable(6)

Disclosure pertaining to real estate held by overseas real estate holding corporations
Not applicable

8. Other(ⅰ) Unitholders general meeting
Not applicable(ⅱ) Board of directors Meeting
Date of approval

Items

Overview

February 13, 2019Conclusion of new investment
unit underwriting agreement

Entrusted administrative work related to solicitation of investment units to beissued to underwriters (SMBC Nikko Securities Co., Ltd., Mizuho Securities Co.,
Ltd., Nomura Securities Co., Ltd.).

54

（2）Other
Unless otherwise specified, amounts are rounded down and ratios are rounded off.

[Provisional Translation Only]
English translation of the original Japanese document is provided solely for information purposes.
Should there be any discrepancies between this translation and the Japanese original, the latter shallprevail.

55

Financial Statements(15th Fiscal Period: From February 1, 2019 to July 31, 2019)

Independent Auditor’s Report
Balance Sheet
Statement of Income and Retained Earnings
Statement of Changes in Net Assets
Statement of Cash Flows
Notes to Financial Statements

56

57

KENEDIX RESIDENTIAL NEXT INVESTMENT CORPORATION

Balance Sheet
As of July 31, 201915th Fiscal Period
as of July 31, 201914th Fiscal Period
as of January 31, 2019(in thousands of yen)
ASSETS
Current assets
Cash and deposits (Notes 7 and 9)
Cash and deposits in trust (Notes 7 and 9)
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Noncurrent assets
Property, plant and equipment (Notes 14 and 19)
Land
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
Total property, plant and equipment, net
Intangible assets
Leasehold right in trust (Notes 14 and 19)
Other
Total intangible assets
Investments and other assets
Investment securities (Notes 9 and 18)
Lease and guarantee deposits
Long-term prepaid expenses
Total investments and other assets
Total noncurrent assets
Deferred assets
Investment corporation bond issuance costs
Investment unit issuance costs
Total deferred assets
Total assets¥10,296,548
9,903,118
36,005
12,815856
20,249,344¥12,356,302

1,798,041
99,911,220(10,381,143)
89,530,077
1,073,137(191,362)
881,774
1,436,362(321,177)
1,115,184
523,059(65,444)457,614
138,484,736
232,267,430

1,798,041
95,077,289(9,123,715)
85,953,573
947,729(161,739)
785,989
1,429,327(288,590)
1,140,736
473,614(51,478)
422,136
130,189,152
220,289,630

1,228,912
5,563
1,234,475

1,067,058
6,339
1,073,398

2,398
89,0971,014,728
1,106,223
234,608,129

111,796
29,097
1,059,774
1,200,668
222,563,697

35,327

38,57072,94445,012

108,272¥254,965,747

83,583¥245,103,757

9,721,629
26,612
7,450
338,402
6,081
22,456,477

58

15th Fiscal Period
as of July 31, 201914th Fiscal Period
as of January 31, 2019(in thousands of yen)
LIABILITIESCurrent liabilities
Operating accounts payable¥772,751¥912,385

Short-term loans payable (Notes 9 and 21)

2,500,000

2,050,000

Current portion of long-term loans payable (Notes 9, 10 and 21)
Accounts payable-otherAccrued expenses
Income taxes payable

13,200,000
305,806
27,560605

9,700,000
298,718
27,236605

Accrued consumption taxes
Advances received
Deposits received
Other
Total current liabilities
Noncurrent liabilities

21,474

11,413

1,148,654
58,742

1,096,282
75,292

10,098-18,045,693

14,171,933

Investment corporation bonds (Notes 9 and 20)

5,000,000

5,000,000

Long-term loans payable (Notes 9, 10 and 21)
Tenant leasehold and security deposits in trust

105,200,000
3,099,642

106,500,000
2,682,738

4,493,753

4,405,195

67,338-Tenant lump sum deposits in trust
Asset retirement obligations (Note 13)

517,915392,732

118,378,649

118,980,667

136,424,343

133,152,600

99,731,514

93,226,228

13,187,100

13,187,100

Reserve for temporary difference adjustments (Note 4)

1,980,000

2,000,000

Total voluntary retained earnings

1,980,000

2,000,000

Other
Total noncurrent liabilities
Total liabilities
NET ASSETS
Unitholders' equity
Unitholders' capital
SurplusCapital surplus
Voluntary retained earnings

Unappropriated retained earnings

4,125,881

3,875,050

19,292,981
119,024,495

19,062,150
112,288,379

Deferred gains or losses on hedges (Notes 9 and 10)(483,092)(337,222)

Total valuation and translation adjustments(483,092)(337,222)

Total surplus
Total unitholders' equity
Valuation and translation adjustments

Total net assets (Note 3)

118,541,403

111,951,157

Total liabilities and net assets¥254,965,747¥245,103,757

See accompanying notes to the financial statements.

59

KENEDIX RESIDENTIAL NEXT INVESTMENT CORPORATIONStatement of Income and Retained Earnings
For the period from February 1, 2019 to July 31, 201915th Fiscal Period
from February 1, 2019
to July 31, 201914th Fiscal Period
from August 1, 2018
to January 31, 2019(in thousands of yen)
Operating revenues
Rent revenue-real estate (Note 5)
Other lease business revenue (Note 5)
Gain on sales of real estate property (Note 5)
Dividends income
Total operating revenues
Operating expenses
Expenses related to rent business (Note 5)
Asset management fees
Asset custody fees
Administrative service fees
Directors' compensation
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Dividends and redemption-prescription
Interest on refund
Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds
Borrowing expenses
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 (Note 12)
Current
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings¥7,342,246
590,778
203,392
8,136,417¥7,085,174
520,733
203,178
14,461

2,915,721
562,274
13,40445,9508,100
231,968
3,777,419
4,358,998

2,794,762
513,065
11,98541,7238,100
240,701
3,610,337
4,213,210

38
765
463
1,268

45
313
3
362

485,799
13,825100,264
3,243
15,269618,4023,741,863
3,741,863

491,7449,974
101,2232,560
9,022
614,525
3,599,047
3,599,047

605
605
3,741,258
384,622¥4,125,881

605
605
3,598,442
276,608¥3,875,050

7,823,548

See accompanying notes to the financial statements.

60

KENEDIX RESIDENTIAL NEXT INVESTMENT CORPORATIONStatement of Changes in Net Assets
For the period from February 1, 2019 to July 31, 2019

Unitholders'
capitalBalance as of July 31, 2018
Changes of items during the period
Issuance of new investment units
Provision of reserve for temporary
difference adjustments
Dividends from surplus
Net income
Net changes of items other thanunitholders' equity
Total changes of items during the period
Balance as of January 31, 2019 (Note 6)
Changes of items during the period
Issuance of new investment units
Reversal of reserve for temporary
difference adjustments
Dividends from surplus
Net income
Net changes of items other thanunitholders' equity
Total changes of items during the period
Balance as of July 31, 2019 (Note 6)¥80,132,379

Capitalsurplus¥13,187,100

Unitholders' equity
Surplus
Voluntary retained earnings
UnappropriatedReserve for
Total
retained
temporaryvoluntaryearnings
difference
retained
adjustments
earnings(in thousands of yen)¥¥¥5,428,676

Total
unitholders'equityTotal
surplus¥18,615,776

13,093,849

13,093,849
2,000,000

13,093,849¥93,226,228¥13,187,100

2,000,000(2,000,000)--(3,152,068)
3,598,442(3,152,068)
3,598,442(3,152,068)
3,598,442
13,540,223¥112,288,379

2,000,000¥2,000,000

2,000,000¥2,000,000(1,553,626)¥3,875,050

446,373¥19,062,150(20,000)(20,000)

20,000--(3,510,428)
3,741,258(3,510,428)
3,741,258(3,510,428)
3,741,258

250,830¥4,125,881

230,830¥19,292,981

6,736,116¥119,024,495

6,505,285

6,505,285¥99,731,514¥98,748,155

6,505,285¥13,187,100(20,000)¥1,980,000(20,000)¥1,980,000

Valuation and translation adjustments
Deferred gains orlosses on hedges

Balance as of July 31, 2018
Changes of items during the period
Issuance of new investment units
Provision of reserve for temporary
difference adjustments
Dividends from surplus
Net income
Net changes of items other thanunitholders' equity
Total changes of items during the period
Balance as of January 31, 2019 (Note 6)
Changes of items during the period
Issuance of new investment units
Reversal of reserve for temporary
difference adjustment
Dividends from surplus
Net income
Net changes of items other thanunitholders' equity
Total changes of items during the period
Balance as of July 31, 2019 (Note 6)

Total valuationand translation
adjustments(in thousands of yen)
¥ (2,512)¥ (2,512)

Total net assets¥98,745,643
13,093,849(3,152,068)
3,598,442(334,709)(334,709)(334,709)(334,709)¥(337,222)(334,709)¥(337,222)

13,205,513¥111,951,157
6,505,285(3,510,428)
3,741,258(145,870)(145,870)(145,870)(145,870)¥(483,092)(145,870)¥(483,092)

6,590,246¥118,541,403

See accompanying notes to the financial statements.

61

KENEDIX RESIDENTIAL NEXT INVESTMENT CORPORATIONStatement of Cash Flows
For the period from February 1, 2019 to July 31, 201915th Fiscal Period
from February 1, 2019
to July 31, 201914th Fiscal Period
from August 1, 2018
to January 31, 2019(in thousands of yen)
Net cash provided by (used in) operating activities
Income before income taxes
Depreciation and amortization
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance costs
Interest income
Interest expenses
Decrease (increase) in operating accounts receivable
Decrease (increase) in consumption taxes refund receivable
Decrease (increase) in prepaid expenses
Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued consumption taxes
Increase (decrease) in advances received
Decrease (increase) in long-term prepaid expenses
Decrease in net property, plant and equipment held in trust due to sale
Other, net¥3,741,863
1,392,068
3,243
15,269(38)
499,624(9,393)
338,402(5,365)(109,149)
7,522
10,061
52,37245,046482,312(8,827)¥3,599,047
1,343,939
2,560
9,022
(45)
501,7192,576(338,402)
3,405
117,776
15,829(52,443)
137,469(142,793)
500,913
19,148Subtotal

6,455,011

5,719,725

Interest income received
Interest expenses paid
Income taxes (paid) refund

38(509,888)
2,074

45(511,560)
3,769

Net cash provided by (used in) operating activities

5,947,236

5,211,979(13,813,975)(162,428)
103,455(60,000)(141,168)
558,072(79,827)
168,384(29,866,970)(1,832)402,700
10,000(133,676)
486,208(103,996)
304,115

Net cash provided by (used in) investing activities(13,427,488)(28,903,451)

Net cash provided by (used in) financing activities
Increase in short-term loans payable
Decrease in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of investment corporation bonds
Proceeds from issuance of investment units
Dividends paid

2,500,000(2,050,000)
4,700,000(2,500,000)
6,462,083(3,510,096)(580,000)
26,700,000(11,000,000)
1,981,451
13,039,815(3,151,284)

5,601,986

26,989,982

Net cash provided by (used in) investing activities
Purchase of property, plant and equipment in trust
Purchase of intangible assets in trust
Purchase of investment securities
Proceeds from investment securities
Payments for lease and guarantee deposits
Proceeds from lease and guarantee deposits
Repayments of tenant leasehold and security deposits in trust
Proceeds from tenant leasehold and security deposits in trust
Repayments of tenant lump sum deposits in trust
Proceeds from tenant lump sum deposits in trust

Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents(1,878,264)

3,298,510

Cash and cash equivalents at the beginning of period

22,077,932

18,779,421

Cash and cash equivalents at the end of period (Note 7)¥20,199,667¥22,077,932

See accompanying notes to the financial statements.

62

KENEDIX RESIDENTIAL NEXT INVESTMENT CORPORATION

Notes to Financial Statements
For the period from February 1, 2019 to July 31, 2019

1. ORGANIZATION AND BASIS OF PRESENTATION
Organization
Kenedix Residential Next Investment Corporation (“the Investment Corporation”) was established on November 15, 2011 under the Act on
Investment Trusts and Investment Corporations of Japan (“the Investment Trust Act”). On April 26, 2012, the Investment Corporation was listed on
the Real Estate Investment Trust Market of the Tokyo Stock Exchange (Securities Code: 3278). The Investment Corporation implemented a 2-for-1
split of its investment units held by unitholders set forth or recorded in the final unitholder registry on February 28, 2018 with March 1, 2018 as theeffective date. And also on March 1, 2018, the Investment Corporation conducted an absorption-type merger (“the Merger”) whereby theInvestment Corporation was the surviving corporation and Japan Senior Living Investment Corporation (“JSL”) was the dissolving corporation.
In the 15th fiscal period, the Investment Corporation raised funds through the latest public offering and third-party allotment for the second
consecutive period, and acquired 6 properties (total acquisition price of ¥12,844 million) with the funds of new investment units and new
borrowings.As of July 31, 2019, the end of the 15th fiscal period, the number of investment units issued and outstanding totaled 907,458 units.
The Investment Corporation is externally managed by Kenedix Real Estate Fund Management, Inc. (“the Asset Management Company”), a
company that was formed with personnel from Kenedix, Inc. and adheres to the core philosophies of Kenedix, Inc., that is, to provide management
services from the perspective of real estate investors as an independent real estate management company. As the asset manager, the AssetManagement Company shall provide flexible and speedy real estate investment and management services based on the strategies of theInvestment Corporation: “Flexible pursuit for appropriate investment and profit opportunities with comprehension of the real estate market trends”
and “Speedy execution based on expeditious information collection and judgement.”
During the 15th fiscal period, the Investment Corporation acquired 3 residential properties (total acquisition price of ¥3,158 million) and 3
healthcare properties (total acquisition price of ¥9,685 million), and sold 1 residential property (acquisition price of ¥510 million, disposition price of¥690 million). As the result, the Investment Corporation has a portfolio comprised of 143 properties (total acquisition price of ¥233,251 million) as
of July 31, 2019, the end of the 15th fiscal period. The portfolio consists of 118 residential properties (total acquisition price of ¥177,373 million), 24
healthcare properties (total acquisition price of ¥54,128 million) and 1 other property (acquisition price of ¥1,750 million).
The occupancy rates of the overall portfolio including land with leasehold interest were 97.7% and 97.5% as of the end of the 14th and 15th
fiscal period, respectively. Furthermore, the average occupancy rates of the properties for residential and healthcare were 96.4% and 100.0% as ofthe end of 15th fiscal period.
During the 14th and 15th fiscal period, the Investment Corporation made borrowings of ¥11,000 million and ¥4,300 million for the repayment ofdebt matured. During the 14th fiscal period, the Investment Corporation made new borrowings of ¥15,700 million upon acquiring properties andalso issued investment corporation bonds of ¥2,000 million upon acquiring properties. During the 15th fiscal period, the Investment Corporation
made new borrowings of ¥2,900 million upon acquiring properties. As a result, the balance of borrowings as of the end of the 14th and 15th fiscal
period stood at ¥118,250 million and ¥120,900 million, respectively. The balance of interest-bearing debt including investment corporation bonds
as of the end of the 14th and 15th periods, was ¥ 123,250 million and ¥ 125,900 million, respectively.
Basis of Presentation
The Investment Corporation maintains its accounting records and prepares its financial statements in accordance with accounting principles
generally accepted in Japan (Japanese GAAP), including provisions set forth in the Investment Trust Act, the Companies Act of Japan, theFinancial Instruments and Exchange Act of Japan and related regulations, which are different in certain respects as to the application anddisclosure requirements of International Financial Reporting Standards.
The accompanying financial statements are a translation of the audited financial statements of the Investment Corporation, which wereprepared in accordance with Japanese GAAP and were presented in the Securities Report of the Investment Corporation filed with the Kanto Local
Finance Bureau. In preparing the accompanying financial statements, certain reclassifications and modifications have been made to the financial
statements issued domestically in order to present them in a format that is more familiar to readers outside Japan. In addition, the notes tofinancial statements include certain information that might not be required under Japanese GAAP but is presented herein as additional information.
The Investment Corporation fiscal period is a six-month period which ends at the end of January or July. The Investment Corporation does notprepare consolidated financial statements because it has no subsidiaries.

632. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(A) Securities
Other securities without market value are stated using the moving average cost method. Equity investments in an anonymous association
are stated, the amount equivalent to the corresponding equity interests including net amount of gain or loss from the anonymous association.
(B) Property and Equipment (including trust assets)
Property and equipment are stated at cost. Depreciation of property and equipment is calculated on a straight-line basis over the estimateduseful lives of the assets ranging as stated below:

Buildings

From February 1, 2019
to July 31, 20192-69 years

From August 1, 2018
to January 31, 20192-69 years

Structures

3-65 years

3-57 years

Machinery and equipment

8-40 years

8-35 years

Tools, furniture and fixtures

2-30 years

5-30 years(C) Intangible Assets(including trust assets)
Intangible assets are amortized by the straight-line method. Fixed-term leaseholds are amortized by the straight-line method based on thecontract period.
(D) Long-term Prepaid Expenses
Long-term prepaid expenses are amortized by the straight-line method.
(E) Unit Issuance Costs
Unit issuance costs are amortized over a period of 3 years under the straight-line method.
(F) Investment Corporation Bond Issuance Costs
Investment corporation bond issuance costs are amortized over a maturity period under the straight-line method.
(G) Accounting Treatment of Trust Beneficiary Interests in Real Estate
For trust beneficiary interests in real estate, which are commonly utilized in the ownership of commercial properties in Japan, all relevant
assets and liabilities in trust are recorded on the balance sheet and the statement of income and retained earnings.
(H) Revenue Recognition
Operating revenues consist of rental revenues including base rents and common area charges, and other operating revenues including
parking space rental revenues and other miscellaneous revenues. Rental revenues are generally recognized on an accrual basis over the lifeof each lease.
(I)

Taxes on Property and Equipment
Property-related taxes including property taxes, city planning taxes and depreciable property taxes are imposed on properties on a calendar
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 from the date of disposal to the end of thecalendar year in which the property is disposed. The seller, however, is generally reimbursed by the purchaser for these accrued
property-related tax liabilities.

64

When the Investment Corporation purchases properties, it typically allocates the portion of the property-related taxes related to the period
following the purchase date of each property through the end of the calendar year. The amounts of those allocated portions of theproperty-related taxes are capitalized as part of the acquisition costs of the related properties. Capitalized property-related taxes amounted to¥50,824 thousand and ¥33,037 thousand as of January 31, 2019 and July 31, 2019, respectively.
(J) Income Taxes
Deferred tax assets and liabilities are computed based on the difference between the financial statements and income tax bases of assets
and liabilities using the statutory tax rates.
(K) Consumption Taxes
Transactions subject to consumption taxes are recorded at amounts exclusive of consumption taxes. Non-deductible consumption taxes
applicable to the acquisition of assets are included in the cost of acquisition for each asset.
(L) Derivative Financial Instruments
The Investment Corporation enters into derivative transactions to hedge risks prescribed in its Articles of Incorporation based on its risk
management policies. The Investment Corporation hedges interest rate volatility risk of its interest payments on its borrowings by utilizing
interest rate swap as hedging instruments.
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 madebased on changed amount, etc. However, an assessment of the effectiveness of hedging activities is omitted in the case of interest rate
swaps and other derivatives that meet the requirements for special treatment.
(M) Cash and Cash Equivalents
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 the date of purchase.
(N) Presentation of Amounts
Amounts of less than one thousand yen are truncated in the Japanese financial statements prepared in accordance with Japanese GAAP
and filed with regulatory authorities in Japan. Unless otherwise noted, amounts are rounded down and ratios are rounded off in theaccompanying financial statements. Totals shown in the accompanying financial statements do not necessarily agree with the sums of theindividual amounts.

65

3. NET ASSETSThe Investment Corporation issues only non-par value units in accordance with the Investment Trust Act. The entire amount of the issue price of
new units is designated as stated capital. The Investment Corporation is required to maintain net assets of at least ¥50,000 thousand as requiredby the Investment Trust Act.

4. RESERVE FOR TEMPORARY DIFFERENCE ADJUSTMENTS
As of July 31, 2019
The following summarizes reserve for temporary difference adjustments.
Balance atReserve
Reversal
Initial amount the beginningduring theduring theof the period
periodperiod(in thousands of yen)

Balance atthe end of
the period

Reason for reserve andreversalAppropriation for cash
distribution* The Investment Corporation reserved part of gain on negative goodwill incurred in the 13th fiscal period as reserve for temporary
Gain on negative goodwill*¥2,000,000¥2,000,000¥ -¥20,000¥1,980,000

difference adjustments. At least 1% of the initial amount in equal installments over 50 years (100 fiscal periods) will be reversed every
fiscal period starting from the next fiscal period after the fiscal period, in which the initial amount was reserved.
As of January 31, 2019
The following summarizes reserve for temporary difference adjustments.
Balance atReserve
Reversal
Initial amount the beginningduring theduring theof the period
periodperiod(in thousands of yen)

Balance atthe end of
the period

Reason for reserve andreversal

Reserve of a part of gain
on negative goodwill by
merger* The Investment Corporation reserved part of gain on negative goodwill incurred in the 13th fiscal period as reserve for temporary
Gain on negative goodwill*¥2,000,000¥ -¥2,000,000¥ -¥2,000,000

difference adjustments. At least 1% of the initial amount in equal installments over 50 years (100 fiscal periods) will be reversed every
fiscal period starting from the next fiscal period after the fiscal period, in which the initial amount was reserved.

66

5. BREAKDOWN OF RENTAL AND OTHER OPERATING REVENUES, PROPERTY-RELATEDEXPENSES AND GAIN ON SALES OF REAL ESTATE PROPERTY
Rental and other operating revenues and property-related expenses for the periods from February 1, 2019 to July 31, 2019 and from August 1,
2018 to January 31, 2019 consist of the following:
From February 1, 2019
From August 1, 2018
to July 31, 2019
to January 31, 2019(in thousands of yen)
A. Rental and other operating revenues:
Rental revenues¥6,964,736¥6,711,825

Rental revenues from limited proprietary rights of land

43,75043,749Common area charges

333,759

329,599

7,342,246

7,085,174

Parking space rental revenues

206,653

210,398

Miscellaneous

384,125

310,334

Subtotal
Others:Subtotal
Total rental and other operating revenues

590,778

520,733¥7,933,025¥7,605,908¥425,193¥408,364

B. Property-related expenses:
Property management fees and facility management fees
Utilities

95,30497,432

Taxes

476,820

410,483

Repairs and maintenance

300,657

318,838

Insurance

11,671

11,487

Trust fees

53,33553,141

Depreciation

1,391,292

1,343,163

Others161,445

151,851¥2,915,721¥2,794,762¥5,017,303¥4,811,146

Total property-related expenses
C. Net operating income from real estate rental business (A-B)
Gain on sales of real estate property:
From February 1, 2019 to July 31, 2019(in thousands of yen)
KDX Residence Shin-Osaka
Revenue from sale of real estate property¥690,000Cost of real estate property

482,312

Other sales expenses
Gain on sales of real estate property

4,295¥203,392

From August 1, 2018 to January 31, 2019(in thousands of yen)
KDX Residence Kotodai
Revenue from sale of real estate property¥730,574

Cost of real estate property

500,913

Other sales expenses
Gain on sales of real estate property

26,481¥203,17867

6. UNITHOLDERS’ EQUITY
Total number of authorized investment units and total number of investment units issued and outstanding are as follows:

Total number of authorized investment units

From February 1, 2019
to July 31, 201910,000,000 units

From August 1, 2018
to January 31, 201910,000,000 units

907,458 units

869,133 units

Total number of investment units issued and outstanding

7. CASH AND CASH EQUIVALENTS
Cash and cash equivalents consist of the following as of July 31, 2019 and January 31, 2019:
As of July 31, 2019

As of January 31, 2019(in thousands of yen)
Cash and deposits¥10,296,548¥12,356,302

Cash and deposits in trust

9,903,118

9,721,629

Cash and cash equivalents¥20,199,667¥22,077,932

8. LEASES
The Investment Corporation, as lessee, has entered into Fixed-term lease contract whereby fixed monthly rents are due in advance . The future
minimum rental expenses under existing non-cancelable operating leases as of July 31, 2019 and January 31, 2019 are as follows:
As of July 31, 2019

As of January 31, 2019(in thousands of yen)Due in 1 year

¥12,000¥-

Due after 1 year

551,000-

Total¥563,000¥-

The Investment Corporation, as lessor, has entered into leases whereby fixed monthly rents are due in advance with a lease term of generally
two years for residential properties. The future minimum rental revenues under existing non-cancelable operating leases as of July 31, 2019 andJanuary 31, 2019 are as follows:
As of July 31, 2019

As of January 31, 2019(in thousands of yen)Due in 1 year

¥3,265,232¥2,769,825

Due after 1 year

20,920,160

18,849,702

Total¥24,185,392¥21,619,527

68

9. FINANCIAL INSTRUMENTS(A). Overview(1) Policy for financial instruments
The Investment Corporation procures funds for asset acquisitions, repairs, payment of distributions, repayment of loans, etc. through loans fromfinancial institutions, issuance of investment corporation bonds, issuance of investment units and other means. With regard to the procurement ofinterest-bearing debts, the Investment Corporation ensures that it can effectively combine stable long-term funds with flexible short-term funds.
Management of surplus funds is undertaken through various bank deposits focusing on safety, liquidity and effectiveness. The Investment
Corporation uses derivatives for the purpose of hedging its exposure to changes in interest rates and other risks and does not enter into derivativetransactions for speculative or trading purposes.
(2) Types of financial instruments and related risk
Bank deposits are for managing the Investment Corporation’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 an anonymous association and are exposed tocredit risk of the issuer, risk of fluctuation of value of its property and interest rate fluctuation risk.
Borrowings and investment corporation bonds are made primarily for the purpose of procuring funds for the acquisition of real estate and trust
beneficiary interests in real estate and have a repayment date of a maximum of 9 years and 2 months for borrowings and also have a redemption
date of a maximum of 9 years and 4 months for investment corporation bonds as of July 31, 2019, the end of the 15th fiscal period, are exposed toliquidity risk where alternative funds may not be procured by the repayment date. Also, borrowings with floating interest rates are exposed tointerest rate fluctuation risk. Derivatives are used for the purpose of hedging interest rate fluctuation risk for a certain portion of the borrowings.
(3) Risk management for financial instruments
a. 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 an anonymous association and are exposed to credit risk of the issuer and interest rate fluctuation risk.
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, the Investment Corporation 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 volatility risk, such risk is monitored by adjusting the rate of the balance ofborrowings 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 are equity investments in an anonymous association, are exposed to credit
risk of the issuer and property value fluctuation risk, the Investment Corporation periodically reviews the value of the property and financial
condition of the issuer with regard to these investment securities. A risk management policy is established with regard to the execution andmanagement of derivatives, and such transactions are entered into based on this policy.
c.

Liquidity risk

Though borrowings are subject to liquidity risk, the Investment Corporation 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.
(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, fairvalue is reasonably estimated. Since various assumptions and factors are reflected in estimating the fair value, different assumptions and factors
could result in a different fair value.

69

(B). Estimated Fair Value of Financial Instruments
The carrying value of financial instruments on the balance sheet and estimated fair value are shown in the following table.
As of July 31, 2019
Carrying amount

Estimated fair value

Difference(in thousands of yen)

(1)

Cash and deposits(2)

Cash and deposits in trust
Subtotal¥10,296,548¥10,296,548¥-

9,903,118

9,903,118-

20,199,667

20,199,667-(1)

Short-term loans payable

2,500,000

2,500,000-(2)

Current portion of long-term loans payable

13,200,000

13,198,325(1,674)(3)

Investment corporation bonds

5,000,000

5,036,600

36,600(4)

Long-term loans payable

105,200,000

106,075,204

875,204

125,900,000

126,810,130

910,130

Subtotal
Derivative transactions*¥(483,092)¥(483,092)¥* Figures indicate net amount of derivative assets/liabilities derived from derivative transactions, with minus representing net liabilities-

As of January 31, 2019
Carrying amount

Estimated fair value

Difference(in thousands of yen)

(1)

Cash and deposits(2)

Cash and deposits in trust
Subtotal¥12,356,302¥12,356,302

9,721,629

9,721,629¥-

22,077,932

22,077,932-(1)

Short-term loans payable

2,050,000

2,050,000(2)

Current portion of long-term loans payable

9,700,000

9,702,693

2,693

(3)

Investment corporation bonds

5,000,000

4,994,100(5,900)(4)

Long-term loans payable

106,500,000

106,881,219

381,219

123,250,000

123,628,012

378,012Subtotal

Derivative transactions*¥(337,222)¥(337,222)¥* Figures indicate net amount of derivative assets/liabilities derived from derivative transactions, with minus representing net liabilities.

-

Note 1: 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 with floating interest rates, 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 ofprincipal and interest discounted by the estimated interest rate to be applied in the event that the Investment Corporation conducts new borrowingsof 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 the Investment
Corporation has not changed 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 applicableinterest-rate swaps, discounted by the estimated interest rate to be applied in the event that the Investment Corporation conducts new borrowingsof the same type.)70(3) Investment corporation bonds
The fair value of investment corporation bonds is based on quoted market prices.
Derivative transactions
Please refer to Note 10 “DERIVATIVE TRANSACTIONS”.
Note 2: Financial instruments whose fair values are extremely difficult to recognize(in thousands of yen)Classification

As of July 31, 2019

Investment securities *As of January 31, 2019
¥2,398¥111,796*Fair values of investment securities are not subject to disclosure of fair value as they have no market value and their fair values are extremely
difficult to recognize.
Loss on valuation of investment securities of ¥5,942 thousand was recognized in the fiscal period ended July 31, 2019.
Note 3: Redemption schedule for financial assets with maturities
As of July 31, 2019
Due in 1 year or
less

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¥¥(in thousands of yen)

Cash anddeposits
Cash anddeposits in trust
Total¥10,296,548¥

9,903,118¥-¥20,199,667

As of January 31, 2019
Due in 1 year or
less

-

¥

¥

-

-

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¥¥(in thousands of yen)

Cash anddeposits
Cash anddeposits in trust
Total¥12,356,302¥

9,721,629-¥-¥22,077,932

¥

-

¥

-

-

¥

-

-

¥

-

-

¥

-

-

¥

-

Note 4: Redemption schedule for loans payable and investment corporation bonds
As of July 31, 2019
Due in 1 year or
lessShort-term loans
payableInvestment
corporation bonds
Long-term loans
payableTotal¥2,500,000

Due after 1 year
through 2 years¥

Due after 2 years
Due after 3 years
through 3 years
through 4 years(in thousands of yen)
-

¥

-

¥

-

Due after 4 years
through 5 years¥-

Due after 5 years
¥

-

-

-

1,000,000-

1,000,000

3,000,000

13,200,000

9,450,000

19,650,000

11,550,000

12,800,000

51,750,000¥15,700,000¥9,450,000¥20,650,000¥11,550,000¥13,800,000¥54,750,000

As of January 31, 2019
Due in 1 year or
less

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(in thousands of yen)

Short-term loans
payableInvestment
corporation bonds
Long-term loans
payableTotal¥

2,050,000

¥

-

¥

-

¥

-

¥

-

¥

-

-

-

1,000,000-

1,000,000

3,000,000

9,700,000

9,600,000

13,000,000

17,750,000

11,800,000

54,350,000

9,600,000¥ 14,000,000¥ 17,750,000

12,800,000¥ 57,350,000¥ 11,750,000

¥

¥

71

10. DERIVATIVE TRANSACTIONS
The contract amount and the fair value of interest-rate swap transactions as of July 31, 2019 are shown in the following table.
(1) Transactions not subject to hedge accounting
Not applicable(2) Transactions subject to hedge accounting
Hedge
accounting
methodType of derivativetransactions

Hedged items

Contract amount(in thousands of yen)
Maturing after 1
Total
year

Fair value(in thousands of yen)Calculation method for
applicable fair value

Interest rate swap
Based on the amounttransaction:
Long-term¥56,200,000¥48,700,000¥(483,092) provided by counterparty
Receive/floatingloans payablefinancial institutions
and pay/fixedSpecialInterest rate swap
treatment for transaction:
Long-term
38,300,000
36,800,000*
interest-rate Receive/floatingloans payableswaps
and pay/fixed
Total¥94,500,000¥85,500,000¥(483,092)*Interest rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As a result, their fair
Accounting
method, inprinciple

value is included in the fair value of the hedged long-term loans payable.
The contract amount and the fair value of interest-rate swap transactions as of January 31, 2019 are shown in the following table.
(1) Transactions not subject to hedge accounting
Not applicable(2) Transactions subject to hedge accounting
Hedge
accounting
methodType of derivativetransactions

Hedged items

Contract amount(in thousands of yen)
Maturing after 1
Total
year

Fair value(in thousands of yen)Calculation method for
applicable fair value

Interest rate swap
Based on the amounttransaction:
Long-term¥52,500,000¥52,500,000¥(337,222) provided by counterparty
Receive/floatingloans payablefinancial institutions
and pay/fixedSpecialInterest rate swap
treatment for transaction:
Long-term
38,300,000
36,800,000*
interest-rate Receive/floatingloans payableswaps
and pay/fixed
Total¥90,800,000¥89,300,000¥(337,222)*Interest rate swaps for which the special treatment is applied are accounted for together with the underlying hedged item. As a result, their fair
Accounting
method, inprinciple

value is included in the fair value of the hedged long-term loans payable.

11. RELATED-PARTY TRANSACTIONS
1．Parent Company, major corporate unitholders and other15th Fiscal Period (February 1, 2019 to July 31, 2019) and 14th Fiscal Period (August 1, 2018 to January 31, 2019): Not applicable
2．Affiliated companies and other15th Fiscal Period (February 1, 2019 to July 31, 2019) and 14th Fiscal Period (August 1, 2018 to January 31, 2019): Not applicable
3．Fellow subsidiary companies and other15th Fiscal Period (February 1, 2019 to July 31, 2019) and 14th Fiscal Period (August 1, 2018 to January 31, 2019): Not applicable
4．Directors, major individual unitholders and other15th Fiscal Period (February 1, 2019 to July 31, 2019) and 14th Fiscal Period (August 1, 2018 to January 31, 2019): Not applicable72

12. INCOME TAXESThe Investment Corporation is subject to corporate income taxes at a regular statutory rate of approximately 32%. However, the Investment
Corporation may deduct from its taxable income amounts distributed to its unitholders, provided the requirements under the Special Taxation
Measures Law of Japan are met, including a requirement that it currently distributes in excess of 90% of its net income for the fiscal period in order
to be able to deduct such amounts. If the Investment Corporation does not satisfy all of the requirements, the entire taxable income of theInvestment Corporation will be subject to regular corporate income taxes. Since the Investment Corporation distributed in excess of 90% of its
distributable income in the form of cash distributions totaling ¥3,687 million and ¥3,510 million for the periods ended July 31, 2019 and January 31,
2019, respectively, the distributions were treated as deductible distributions for purposes of corporate income taxes. The effective tax rates on theInvestment Corporation’s income were 0.02% for the periods ended July 31, 2019 and January 31, 2019. The following table summarizes thesignificant differences between the statutory tax rate and the effective tax rate.
From February 1, 2019
to July 31, 201931.51%

From August 1, 2018
to January 31, 201931.51%

Deductible cash distributions(31.04)(30.73)

Others(0.45)(0.76)

Effective tax rate

0.02%

0.02%

Statutory tax rate

The significant components of deferred tax assets and liabilities as of July 31, 2019 and January 31, 2019 are as follows:
As of July 31, 2019

As of January 31, 2019(in thousands of yen)

Deferred tax assets:
Valuation difference on assets acquired by merger¥720,920¥741,176

Deferred gains or losses on hedges

152,608

106,528

Asset retirement obligations

21,272-

Loss on valuation of investment securities

1,872

-

Amortization of leasehold right in trust

181-

896,855

847,704

Subtotal deferred tax assets
Valuation allowance(896,855)(847,704)

Total deferred tax assets

¥

-

¥

-

Net deferred tax assets

¥

-

¥

-

13. ASSET RETIREMENT OBLIGATIONS
Asset retirement obligations reported on balance sheets
1. Summary of the asset retirement obligations
The Investment corporation has recognized the original state restoration obligations assumed under the general fixed-term land leasehold
agreement as the asset retirement obligations in connection with Arute Ishiyagawa acquired on June 3, 2019.
2. Method of calculating asset retirement obligations
Asset retirement obligations are calculated based on a discount rate of 0.54711% and the useful life has been estimated to be 47 years and one
month based on the time period from the date of acquisition to the expiration of the agreement.
3. Changes in the amount of applicable asset retirement obligations consisted of the following
From February 1, 2019

From August 1, 2018

to July 31, 2019

to January 31, 2019(in thousands of yen)

Balance at the beginning of period¥

Increase due to acquisition of tangible fixed assets

67,277-

61-

Accretion adjustment
Balance at the end of period-¥67,338

¥

¥

-

-

73

14. INVESTMENT AND RENTAL PROPERTIESThe Investment Corporation owns real estate for rental purposes in the Tokyo Metropolitan Area and other regional areas for the purpose ofgenerating rental revenues.
The book value and fair value concerning the above real estate for rental purposes are as follows.
15th Fiscal Period
from February 1, 2019
to July 31, 201914th Fiscal Period
from August 1, 2018
to January 31, 2019(in thousands of yen)Book value
Balance at the beginning of period¥221,356,688¥193,148,357

Changes during the period
Balance at the end of period

12,139,653
233,496,342

28,208,331
221,356,688¥273,676,000¥256,174,000

Fair value at the end of period
Note 1: Book value excludes accumulated depreciation from acquisition costs.

Note 2: Among changes in the amount of real estate for rental purposes that occurred during the 15th fiscal period, the principal increase was theacquisition of real estate trust beneficiary interests in 6 properties totaling ¥13,400,965 thousand, and the principal decrease was the salesof real estate trust beneficiary interests in 1 property totaling ¥482,312 thousand and depreciation of ¥1,391,231 thousand , and during the
14th fiscal period, the principal increase was the acquisition of real estate trust beneficiary interests in 10 properties totaling ¥29,437,871
thousand, and the principal decrease was the sales of real estate trust beneficiary interests in 1 property totaling ¥500,913 thousand anddepreciation of ¥1,343,163 thousand.
Note 3: The fair value is the appraisal value or the survey value determined by outside appraisers. In addition, the fair value at the end of 14th
fiscal period of KDX Residence Shin-Osaka, which was sold on February 1, 2019, is based on the sales prices (¥690,000 thousand) under
the trust beneficiary interest sales contracts entered into on January 18, 2019.
Income and loss in the fiscal periods ended July 31, 2019 and January 31, 2019 for real estate for rental purposes is listed in Note 5 ”
BREAKDOWN OF RENTAL AND OTHER OPERATING REVENUES, PROPERTY-RELATED EXPENSES AND GAIN ON SALES OF REALESTATE PROPERTY”.

15. SEGMENT AND RELATED INFORMATION
Segment and related information for the period ended from February 1, 2019 to July 31, 2019 and from August 1, 2018 to January 31, 2019 is asfollows:(A) Segment information
Disclosure is omitted because the real estate leasing business is the Investment Corporation’s sole business and it has no reportable segment
subject to disclosure.
(B) Related information(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 and retained earnings.
(2) Information about each geographic area(a) 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.
(b) 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 sheet.
(3) Information about each major customer
Disclosure is omitted because net sales to a single external customer account for less than 10% of the operating revenue on the statement of74

income and retained earnings.

16. PER UNIT INFORMATION
From February 1, 2019

From August 1, 2018

to July 31, 2019

to January 31, 2019

Net asset value per unit

¥130,630¥128,807

Net income per unit

¥4,142¥4,143Weighted average number of units (units)903,243868,508

The weighted average number of units outstanding of 903,243 and 868,508 were used for the computation of the amount of net income per unit
as of July 31, 2019 and January 31, 2019, respectively.
Net income per unit after adjusting for residual units is not included because there were no residual investment units.
The basis for calculating net income per unit is as follows:
From February 1, 2019
to July 31, 2019
Net income (in thousands of yen)

From August 1, 2018
to January 31, 2019

¥3,741,258

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

¥3,598,442--¥3,741,258¥3,598,442

903,243868,508

Weighted average number of units during the period (units)

17. SIGNIFICANT SUBSEQUENT EVENTS
Not applicable

18. SECURITIES PORTFOLIO
Securities portfolio consists of the following as of July 31, 2019:(1) Stock Not applicable(2) Securities other than shares(in thousands of yen)Type
Subordinated Silent
Partnership Equity
Interests
Total

Name

Prepaid
accruedinterest

Face value
totalBook value

-

2,398

-

-

2,398

-

-

2,398

-

-

2,398

-

Equity interests in TK property fund with G.K.
Tropic III as operator (Note 1)

Accruedinterest

Assessed Gain (Loss)value
onRemarks（Note 2） valuation

Note 1: TK property fund owns trust beneficiary interests in real estate for “Serabi Ebisu” and “Arute Ishiyagawa.” Furthermore, the Investment
Corporation acquired real estate beneficiary interests in trust for the above two mentioned properties on June 3, 2019
Note 2: The assessed value is stated at the book value. Furthermore, loss on valuation of investment securities of ¥5,942 thousand wasrecognized in the fiscal period ended July 31, 2019.
Securities portfolio consists of the following as of January 31, 2019:(1) Stock Not applicable(2) Securities other than shares(in thousands of yen)Type
Subordinated Silent
Partnership Equity
Interests
Total

Name

Prepaid
accruedinterest

Face value
totalBook value-

111,796--

111,796--

111,796--

111,796-

Equity interests in TK property fund with G.K.
Tropic III as operator (Note 1)

Accruedinterest

Assessed Gain (Loss)value
onRemarks（Note 2） valuation

Note 1: TK property fund owns trust beneficiary interests in real estate for “Serabi Ebisu” and “Arute Ishiyagawa.” Furthermore, the Investment
Corporation will acquire real estate beneficiary interests in trust for the above two mentioned properties on June 3, 2019 based on the trust
beneficiary interest sales contracts executed on February 4, 2019.
Note 2: The assessed value is stated at the book value.

7519. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASEETS
Property, plant and equipment consist of the following as of July 31, 2019
Type of asset

Property,plant andequipment

Intangible
assetsLand
Sub total
Buildings in trust
Structures in trust
Machinery andequipment in trust
Tools, furnitureand fixtures intrust
Land in trust
Sub total
Total
Leasehold right in
trust
Other
Total

Balance atthe beginningof period¥1,798,041
1,798,041
95,077,289
947,729

Increaseduring theperiodDecreaseduring theperiod¥¥5,144,241
127,706

Depreciation
Depreciation
Accumulated
for thedepreciation
period(in thousands of yen)
¥1,798,041¥¥
1,798,041
99,911,220
10,381,143
1,313,277
1,073,137
191,362
30,813

Balance atthe end of
period310,3102,298

Netbalance at
end of theperiod¥1,798,041
1,798,041
89,530,077 Notes 1 and 2
881,774

1,429,327

7,035

-

1,436,362

321,177

32,586

1,115,184

473,61449,958513

523,059

65,444

13,978457,614130,189,152
228,117,113
229,915,155

8,521,826
13,850,768
13,850,768

226,242539,365
539,365

138,484,736
241,428,516
243,226,558

10,959,127
10,959,127

1,390,656
1,390,656

1,067,058

162,428-

1,229,487

574

574

1,228,912

7,762¥1,074,821¥162,428-

7,762¥1,237,249

2,199¥2,774776¥1,351

5,563¥1,234,475¥

Remarks

138,484,736 Notes 1 and 2
230,469,388
232,267,430

Note 1: The amount of increase during the period is primarily attributable to the acquisition of the real estate properties and capital expenditures.
Note2: The amount of decrease during the period is primarily attributable to the sales of the real estate property.
Property, plant and equipment consist of the following as of January 31, 2019:
Type of asset

Property,plant andequipment

Intangible
assetsLand
Sub total
Buildings in trust
Structures in trust
Machinery andequipment in trust
Tools, furnitureand fixtures intrust
Land in trust
Sub total
Total
Leasehold right in
trust
Other
Total

Balance atthe beginningof period¥1,798,041
1,798,041
84,656,776
722,432

Increaseduring theperiodDecreaseduring theperiod¥¥10,780,795
227,133

Depreciation
Depreciation
Accumulated
for thedepreciation
period(in thousands of yen)
¥1,798,041¥¥
1,798,041
95,077,289
9,123,715
1,269,324
947,729
161,739
28,801

Balance atthe end of
period360,282
1,836

Netbalance at
end of theperiod¥1,798,041
1,798,041
85,953,573 Notes 1 and 2
785,989

1,360,078

72,927

3,678

1,429,327

288,590

32,6241,140,736

400,899

75,137

2,421

473,61451,47812,412

422,136

111,474,267
198,614,454
200,412,495

18,896,415
30,052,408
30,052,408

181,530
549,749
549,749

130,189,152
228,117,113
229,915,155

9,625,524
9,625,524

1,343,163
1,343,163

1,067,058--

1,067,058--

1,067,058

7,762¥1,074,821

-

-

7,762
¥1,074,821

1,423¥1,423

776
¥776

6,339
¥1,073,398¥¥

Remarks

130,189,152 Notes 1 and 2
218,491,588
220,289,630

Note 1: The amount of increase during the period is primarily attributable to the acquisition of the real estate properties and capital expenditures.
Note2: The amount of decrease during the period is primarily attributable to the sales of the real estate property.

7620. INVESTMENT CORPORATION BONDS
Outstanding Investment corporation bonds as of July 31, 2019 are as follows.
Balance at
Decrease
Balance at
Date of
Seriesthe beginningduring thethe end ofissue
of period
periodperiod(in thousands of yen)First series of unsecured
August 30,
investment corporation¥ ¥1,000,000¥1,000,000
2016
bonds (Note 1)
Second series ofAugust 30,
unsecured investment
1,000,000
1,000,000
corporation bonds
2016(Note 1)
Third series of unsecured
August 30,
investment corporation
1,000,000
1,000,000
2016
bonds (Note 1)
Fourth series ofNovember 30,
unsecured investment
1,000,000
1,000,000
corporation bonds
2018(Note 1)Fifth series of unsecured
November 30,
investment corporation
1,000,000
1,000,000
2018
bonds (Note 1)
Total¥5,000,000¥-

Interest
rate

0.200%
0.540%
0.800%
0.410%
0.850%

Repayment date

Use

Remarks(Note2)

Unsecured

August 30,
2021
August 28,
2026
August 30,
2028
November 30,
2023
November 30,
2028¥5,000,000

Note 1: Ranking pari passu among the specified investment corporation bonds.
Note 2: Investment corporation bonds were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate andrepayment of debts.
Note 3: Annual repayments of investment corporation bonds scheduled for the next five years after the balance sheet date are as follows
Due in 1 year
Due after 1 year
Due after 2 years
Due after 3 years
Due after 4 years
or less
through 2 years
through 3 years
through 4 years
through 5 years(in thousands of yen)

Investment
corporation bonds

¥ -

¥ -

¥1,000,000

Outstanding Investment corporation bonds as of January 31, 2019 are as follows.
Balance at
Decrease
Balance at
Date of
Seriesthebeginning
duringthethe end ofissue
of period
periodperiod(in thousands of yen)First series of unsecured
August 30,
investment corporation¥ ¥1,000,000¥1,000,000
2016
bonds (Note 1)
Second series ofAugust 30,
unsecured investment
1,000,000
1,000,000
corporation bonds
2016(Note 1)
Third series of unsecured
August 30,
investment corporation
1,000,000
1,000,000
2016
bonds (Note 1)
Fourth series ofNovember 30,
unsecured investment
1,000,000
corporation bonds
2018(Note 1)Fifth series of unsecured
November 30,
investment corporation
1,000,000
2018
bonds (Note 1)
Total¥3,000,000

¥

-

¥ -

Interest
rate

0.200%
0.540%
0.800%
0.410%
0.850%¥1,000,000

Repayment date

Use

Remarks(Note2)

Unsecured

August 30,
2021
August 28,
2026
August 30,
2028
November 30,
2023
November 30,
2028¥5,000,000

Note 1: Ranking pari passu among the specified investment corporation bonds.
Note 2: Investment corporation bonds were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate andrepayment of debts.
Note 3: Annual repayments of investment corporation bonds scheduled for the next five years after the balance sheet date are as follows.
Due in 1 year
or less
Investment
corporation bonds

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¥ -¥1,000,000(in thousands of yen)

¥ -

¥ -

¥1,000,000

77

78

21. SHORT-TERM DEBT AND LONG-TERM DEBT
Short-term debt and long-term debt consist of the following as of July 31, 2019
Classification
LenderBalance atthebeginning of
periodIncreaseduring theperiod¥1,250,000¥

Decreaseduring theperiodAverageinterest
rate(Note 3)(Note 4)

Payment due date
(Note 7)-0.412%

July 31, 2019

Balance atthe end of
periodUse

Remarks(Note 6)

Unsecured/
Unguaranteed(Note 6)

Unsecured/
Unguaranteed(Note 6)

Unsecured/
Unguaranteed(in thousands of yen)

Short-termloanspayableCurrent
portion of
long-term
loans
payableLong-term
loans
payableSumitomo Mitsui
Banking Corporation
Mizuho Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Sumitomo Mitsui
Banking Corporation
Sumitomo Mitsui
Banking Corporation
Sub total
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Shinsei Bank, Limited
Resona Bank,Limited.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
The Bank of Fukuoka,
Ltd.
Shinsei Bank, Limited(Note 2)
Sumitomo Mitsui
Banking Corporation(Note 2)
MUFG Bank, Ltd.
(Note 2)
Mizuho Bank, Ltd(Note 2).
Resona Bank, Limited(Note 2).
Mizuho Trust &Banking Co., Ltd(Note 2).
Sub total
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
MUFG Bank, Ltd.
Resona Bank, Limited.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Aozora Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.

-¥ 1,250,000¥

800,000-

800,000-

0.412%

July 31, 2019-

1,000,000-

1,000,000

0.413%

February 28, 2020-

1,000,000-

1,000,000

0.374%

July 31, 2020-

500,000-

500,000

0.324%

July 31, 2020

2,050,000
1,500,000

2,500,000-

2,050,000-

2,500,000
1,500,000

0.689%

November 30, 2019

1,000,000-

1,000,000-

0.486%

February 28, 2019

500,000-

500,000-

0.486%

February 28, 2019

500,000-

500,000-

0.362%

July 31, 2019

500,000-

500,000-

0.362%

July 31, 20191,500,000--

1,500,000

1,400,000
900,000
500,000
400,000--

1,400,000
900,000
500,000
400,000

300,000--

300,000

0.437%

January 31, 2020

300,000--

300,000

200,000--

200,000

200,000--

200,000

1,750,000--

1,750,000

1,750,000--

1,750,000

1,000,000--

1,000,000

500,000--

500,000

500,000--

500,000

500,000--

500,000

15,700,000
1,000,000-

2,500,000-

0.729%

July 29, 2020

13,200,000
1,000,000

1.109%

January 31, 2021

1,000,000--

1,000,000

1.221%

July 31, 2021

1,350,000--

1,350,000

1.183%March 31, 2021

2,000,000--

2,000,000

1.267%

April 30, 2022

1,500,000
1,000,000
1,000,000--

1,500,000
1,000,000
1,000,000

1.267%
1.267%
1.267%

April 30, 2022
April 30, 2022
April 30, 2022

1,100,000--

1,100,000

1,100,000
600,000
350,000
300,000--

1,100,000
600,000
350,000
300,000

300,000--

300,000

1,000,000--

400,000-

400,000
300,000-

0.916%

August 7, 2021

1,000,000

0.996%(Note 5)

August 7, 2021-

400,000

1.254%

August 7, 2023-

400,000
300,000

1.254%

August 7, 2023

(Note 6)79

Classification
LenderLong-term
loans
payableResona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Resona Bank, Limited.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Sompo Japan
Nipponkoa InsuranceInc.
Aozora Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui Trust
Bank, Limited
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan Inc.
MUFG Bank, Ltd.
MUFG Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation

Balance atthebeginning of
period200,000

Increaseduring theperiodDecreaseduring theperiodBalance atthe end of
period(in thousands of yen)--

200,000

Averageinterest
rate(Note 3)(Note 4)

Payment due date
(Note 7)200,000--

200,000

150,000--

150,000

500,000--

500,000

1.320%(Note 5)

August 7, 2023

600,000--

600,000

0.945%

August 31, 2021

600,000
500,000
950,000--

600,000
500,000
950,000

0.945%
0.945%
1.083%

August 31, 2021
August 31, 2021
November 30, 2022

2,000,000--

2,000,000

0.804%

November 30, 2020

1,200,000--

1,200,000

0.875%

January 31, 2022

1,200,000
2,000,000
1,500,000
2,000,000--

1,200,000
2,000,000
1,500,000
2,000,000

1.105%
0.875%
0.987%
1.100%

January 31, 2024
April 30, 2022
April 30, 2023
April 30, 2024

1.265%

April 30, 2025

1.115%

July 29, 2022

1,000,000--

1,000,000

1,100,000--

1,100,000

1,100,000--

1,100,000

1,000,000
300,000--

1,000,000
300,000

1,000,000--

1,000,000

300,000
1,100,000--

300,000
1,100,000

0.678%
0.923%

August 31, 2020
August 31, 2022

700,000--

700,000

0.923%

August 31, 2022

950,000--

950,000

1.047%

August 31, 2023

1,700,000
950,000--

1,700,000
950,000

1.169%
1.169%

August 31, 2024
August 31, 2024

2,000,000--

2,000,000

1.345%

August 31, 2025

1,000,000--

1,000,000

300,000
1,000,000
1,000,000--

2,500,000-

MUFG Bank, Ltd.

1,000,000-

Mizuho Bank, Ltd.

1,500,000--

1,500,000

Aozora Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Resona Bank, Limited.

1,000,000--

1,000,000

0.660%(Note 5)0.816%(Note 5)0.713%

1,000,000--

1,000,000

0.797%

August 31, 2025

500,000--

500,000

August 31, 2025

MUFG Bank, Ltd.

2,000,000--

2,000,000

500,000--

500,000

0.797%
0.670%(Note 5)0.751%(Note 5)3,000,000--

3,000,000

0.906%

August 31, 2026

1,000,000--

1,000,000

1,000,000--

1,000,000

0.773%(Note 5)0.900%

1,000,000--

1,000,000

0.900%

August 22, 2027

1,000,000--

1,000,000--

1,200,000

1,000,000--

1,000,000

500,000--

500,000

0.900%
0.928%(Note 5)0.928%(Note 5)0.928%(Note 5)

August 22, 2027

1,200,000

Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan Inc.
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Development Bank ofJapan Inc.
Mizuho Bank, Ltd.

300,000
1,000,000
1,000,000

1.193%(Note 5)0.624%
1.156%
0.819%

October 27, 2020
April 27, 2025
April 28, 2025-

2,500,000

0.903%

April 30, 2026-

1,000,000

Use

Remarks(Note 6)

Unsecured/
Unguaranteed

August 31, 2024

July 31, 2025
August 31, 2026
August 31, 2024

August 31, 2025
August 31, 2025

October 31, 2025
August 22, 2027

August 22, 2027
August 22, 2027
August 22, 2027

80

Classification
LenderBalance atthebeginning of
periodIncreaseduring theperiodDecreaseduring theperiodBalance atthe end of
periodAverageinterest
rate(Note 3)(Note 4)

Payment due date
(Note 7)Use

Remarks(in thousands of yen)

Long-term
loans
payableThe Bank of Fukuoka,
Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui
Banking Corporation
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Nippon Life Insurance
Company
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Development Bank ofJapan Inc.
Nippon Life Insurance
Company
Resona Bank, Limited.
Shinsei Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
The Bank of Fukuoka,
Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Mizuho Bank, Ltd.
Development Bank ofJapan Inc.
MUFG Bank, Ltd.
Nippon Life Insurance
Company
Shinsei Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
MUFG Bank, Ltd

500,000--

500,000

0.928%(Note 5)

August 22, 2027

1,500,000--

1,500,000

0.501%

February 28, 2023

1,500,000
1,500,000--

1,500,000
1,500,000

0.501%
0.582%

February 28, 2023
February 29, 2024

1,000,000--

1,000,000

0.582%

February 29,2024

1,000,000
500,000--

1,000,000
500,000

February 29, 2024
August 31, 2024

500,000--

500,000

0.582%
0.624%
0.661%(Note 5)1,500,000--

1,500,000

0.665%

February 28, 2025

1,000,000--

1,000,000

0.749%

February 28, 2026

1,000,000--

1,000,000

0.749%

February 28, 2026

1,000,000--

1,000,000

0.409%

July 31, 2021

1,000,000
500,000
500,000--

1,000,000
500,000
500,000

July 31, 2021
July 31, 2021
July 31, 2021

500,000--

500,000

0.409%
0.409%
0.409%
0.900%(Note 5)1,500,000--

1,500,000

1,400,000
900,000--

1,400,000
900,000

500,000--

500,000

500,000--

500,000

400,000
400,000--

400,000
400,000

400,000--

400,000

400,000--

400,000

300,000--

300,000

300,000--

300,000

1,000,000--

400,000--

1,600,000--

1,600,000

1,200,000--

1,000,000
800,000--

1,050,000-

500,000
500,000

August 31, 2024

January 30, 2027

0.799%

February 2, 2026

1,000,000

0.509%

August 31, 2022

400,000

0.509%
0.498%(Note 5)

August 31, 2022

1,200,000

0.592%

August 31, 2023

1,000,000
800,000

0.592%
0.592%

August 31, 2023
August 31, 2023-

1,050,000

0.914%

February 28, 2027--

500,000

0.914%

February 28, 2027--

500,000

0.914%

February 28, 2027

500,000--

500,000

0.914%

February 28, 2027
February 28, 2027

250,000--

250,000

1,400,000--

1,400,000

800,000--

800,000

August 31, 2022

700,000--

700,000

1,000,000--

1,000,000

0.914%
0.884%(Note 5)0.825%(Note 5)0.920%(Note 5)1.031%

800,000--

800,000

1.031%

September 30, 2028

500,000--

500,000

1.031%

September 30, 2028-

500,000-

500,000

0.438%

August 31, 2020

February 28, 2027
February 28, 2027
September 30, 2026
September 30, 2028

81Classification
LenderBalance atthebeginning of
periodIncreaseduring theperiodDecreaseduring theperiodBalance atthe end of
periodAverageinterest
rate(Note 3)(Note 4)

Payment due date
(Note 7)0.363%

November 30, 2024

Use

Remarks(Note 6)

Unsecured/
Unguaranteed(in thousands of yen)

Long-term
loans
payableMizuho Trust &Banking Co., Ltd.

-

400,000-

400,000

Mizuho Bank, Ltd.

-2,000,000-

2,000,000

Shinsei Bank, Limited-

500,000-

Shinsei Bank, Limited-

500,000

100,500,000¥118,250,000

800,000
4,700,000¥7,200,000

Mizuho Bank, Ltd.
Sub total
Total

500,000

0.330%(Note 5)0.484%

November 30,2025-

500,000

0.272%

January 31, 2023

¥4,550,000

800,000
105,200,000¥120,900,000

0.299%

July 31, 2023

May 31, 2025

Note 1: Annual repayments of long-term loans payable (except for current portion of long-term loans payable) scheduled for the next five years
after the balance sheet date are as follows:
Due after 1 year
through 2 years
Long-term loans payable¥9,450,000

Due after 2 years
through 3 years

Due after 3 years
through 4 years(in thousands of yen)
¥19,650,000¥11,550,000

Due after 4 years
through 5 years

Due after 5 years¥12,800,000¥51,750,000

Note 2: Borrowings listed in the current portion of long-term loans payable were listed in long-term loans payable in the previous fiscal period.
Note 3: All debts except for the following Note 5 are borrowing at a floating rate.
Note 4: Average interest rates are the weighted average during the period and figures are rounded to the nearest third decimal place. Also, withregard to borrowings for which interest rate swap transactions were implemented in order to hedge the interest rate volatility risk, theweighted average interest rates taking into consideration the effects of the interest rate swaps are indicated.
Note 5: Borrowings is applied at a fixed rate.
Note 6: All debts were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate (additional expenses areincluded) and repayment of debts.
Note 7: All the repayment methods of debt financing are lump-sum repayments on the due date.

82

Short-term debt and long-term debt consist of the following as of January 31, 2019
Classification
LenderBalance atthebeginning of
periodIncreaseduring theperiodDecreaseduring theperiodBalance atthe end of
periodAverageinterest rate
(Note 3)(Note 4)

Payment due date
(Note 7)Use

Remarks(Note 6)

Unsecured/
Unguaranteed(Note 6)

Unsecured/
Unguaranteed(Note 6)

Unsecured/
Unguaranteed(in thousands of yen)
Short-termloanspayableCurrent
portion of
long-term
loans
payableLong-term
loans
payableSumitomo Mitsui
Banking Corporation(Note 8)Mizuho Bank, Ltd.
Sub total
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Mizuho Bank, Ltd.
Development Bank ofJapan Inc.
MUFG Bank, Ltd.
(Note 2)
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Shinsei Bank, Limited
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
The Bank of Fukuoka,Ltd.
Sub total
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
MUFG Bank, Ltd.
Resona Bank, Limited.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Aozora Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.

¥1,830,000¥-¥580,000¥1,250,000

0.412%

July 31, 2019

800,000
2,630,000-

580,000

800,000
2,050,000

0.412%

July 31, 2019

3,250,000-

3,250,000-

2,000,000
1,000,000
500,000-

2,000,000
1,000,000
500,000-

1.052%

August 31, 2018

500,000-

500,000-

500,000-

500,000-

250,000-

250,000-

3,000,000-

3,000,000-

1.088%(Note 5)

August 31, 2018

1,500,000--

1,500,000

0.689%

November 30, 2019

1,000,000--

1,000,000

0.487%

February 28, 2019

500,000--

500,000

0.487%

February 28, 2019

500,000--

500,000

0.362%

July 31, 2019

500,000--

500,000

0.362%

July 31, 2019-1,500,000-

1,500,000-

1,400,000
900,000
500,000
400,000-

1,400,000
900,000
500,000
400,000-

300,000-

300,000

0.437%

January 31, 2020-

300,000-

300,000-

200,000-

200,000-

200,000-

200,000

15,000,000
1,000,000

5,700,000-

11,000,000-

9,700,000
1,000,000

1.109%

January 31, 2021

1,000,000--

1,000,000

1.221%

July 31, 2021

1,350,000--

1,350,000

1.183%March 31, 2021

2,000,000--

2,000,000

1.267%

April 30, 2022

1,500,000
1,000,000
1,000,000--

1,500,000
1,000,000
1,000,000

1.267%
1.267%
1.267%

April 30, 2022
April 30, 2022
April 30, 2022

1,100,000--

1,100,000

1,100,000
600,000
350,000
300,000--

1,100,000
600,000
350,000
300,000

0.916%

August 7, 2021

300,000--

300,000

1,000,000--

1,000,000

400,000--

400,000

400,000
300,000
200,000--

400,000
300,000
200,000

200,000--

200,000

150,000--

150,000

500,000--

600,000-

600,000-

0.996%(Note 5)

August 7, 2021

1.254%

August 7, 2023

500,000

1.320%(Note 5)

August 7, 2023-

600,000

0.945%

August 31, 2021-

600,000

0.945%

August 31, 2021

83

Classification
LenderLong-term
loans
payableBalance atthebeginning of
periodIncreaseduring theperiodDecreaseduring theperiodBalance atthe end of
periodAverageinterest rate
(Note 3)(Note 4)

Payment due date
(Note 7)500,000
950,000(in thousands of yen)--

500,000
950,000

0.945%
1.083%

August 31, 2021
November 30, 2022

2,000,000--

2,000,000

0.804%

November 30, 2020

1,200,000--

1,200,000

0.875%

January 31, 2022

1,200,000
2,000,000
1,500,000
2,000,000--

1,200,000
2,000,000
1,500,000
2,000,000

1.105%
0.875%
0.987%
1.100%

January 31, 2024
April 30, 2022
April 30, 2023
April 30, 2024

1,000,000--

1,000,000

1.265%

April 30, 2025

1,750,000--

1,750,000

1,750,000--

1,750,000

1,000,000
500,000
500,000--

1,000,000
500,000
500,000

0.729%

July 29, 2020

500,000--

500,000

1,100,000--

1,100,000

1,100,000--

1,100,000

1,000,000
300,000--

1,000,000
300,000

1.115%

July 29, 2022

1,000,000--

1,000,000

300,000
1,100,000--

300,000
1,100,000

0.678%
0.923%

August 31, 2020
August 31, 2022

700,000--

700,000

0.923%

August 31, 2022

950,000--

950,000

1.047%

August 31, 2023

1,700,000
950,000--

1,700,000
950,000

1.169%
1.169%

August 31, 2024
August 31, 2024

2,000,000--

2,000,000

1.345%

August 31, 2025

1,000,000--

1,000,000

300,000
1,000,000
1,000,000--

300,000
1,000,000
1,000,000

1.193%(Note 5)0.624%
1.156%
0.819%

October 27, 2020
April 27, 2025
April 28, 2025

2,500,000--

2,500,000

0.903%

April 30, 2026

MUFG Bank, Ltd.

1,000,000--

1,000,000

Mizuho Bank, Ltd.

1,500,000--

1,500,000

Aozora Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Resona Bank, Limited.

1,000,000--

1,000,000

0.660%(Note 5)0.816%(Note 5)0.713%

1,000,000--

1,000,000

0.797%

August 31, 2025

500,000--

500,000

2,000,000--

2,000,000

500,000--

500,000

0.797%
0.670%(Note 5)0.751%(Note 5)

August 31, 2025

MUFG Bank, Ltd.

3,000,000--

3,000,000

0.906%

August 31, 2026

Aozora Bank, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Resona Bank, Limited.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Shinsei Bank, Limited
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Sompo Japan
Nipponkoa InsuranceInc.
Aozora Bank, Ltd.
Resona Bank, Limited.
Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui Trust
Bank, Limited
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan Inc.
MUFG Bank, Ltd.
MUFG Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation

Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui
Banking Corporation
Development Bank ofJapan Inc.
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Development Bank ofJapan Inc.

Use

Remarks(Note 6)

Unsecured/
Unguaranteed

August 31, 2024

July 31, 2025
August 31, 2026
August 31, 2024

August 31, 2025
August 31, 2025

1,000,000--

1,000,000

1,000,000--

1,000,000

0.773%(Note 5)0.900%

1,000,000--

1,000,000

0.900%

August 22, 2027

1,000,000--

1,000,000

August 22, 2027

1,200,000--

1,200,000

1,000,000--

1,000,000

Mizuho Bank, Ltd.

500,000--

500,000

The Bank of Fukuoka,
Ltd.

500,000--

500,000

0.900%
0.928%(Note 5)0.928%(Note 5)0.928%(Note 5)0.928%(Note 5)October 31, 2025
August 22, 2027

August 22, 2027
August 22, 2027
August 22, 2027
August 22, 2027

84

Classification
LenderBalance atthebeginning of
periodIncreaseduring theperiodDecreaseduring theperiodBalance atthe end of
periodAverageinterest rate
(Note 3)(Note 4)

Payment due date
(Note 7)Use

Remarks(Note 6)

Unsecured/
Unguaranteed(in thousands of yen)

Long-term
loans
payableSumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Aozora Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Mizuho Trust &Banking Co., Ltd.
Sumitomo Mitsui
Banking Corporation
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui
Banking Corporation
Shinsei Bank, Limited
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Nippon Life Insurance
Company
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Development Bank ofJapan Inc.
Nippon Life Insurance
Company
Resona Bank, Limited.
Shinsei Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Aozora Bank, Ltd.
The Bank of Fukuoka,
Ltd.
Sumitomo Mitsui
Banking Corporation
MUFG Bank, Ltd.
Development Bank ofJapan Inc.
Sumitomo Mitsui
Banking Corporation
Aozora Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui
Banking Corporation
Resona Bank, Limited.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Mizuho Bank, Ltd.
Development Bank ofJapan Inc.
MUFG Bank, Ltd.
Nippon Life Insurance
Company
Shinsei Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Trust &Banking Co., Ltd.
Sub total

Total

1,500,000--

1,500,000

0.501%

February 28, 2023

1,500,000
1,500,000--

1,500,000
1,500,000

0.501%
0.582%

February 28, 2023
February 29, 2024

1,000,000--

1,000,000

0.582%

February 29,2024

1,000,000
500,000--

1,000,000
500,000

February 29, 2024
August 31, 2024

500,000--

500,000

0.582%
0.624%
0.661%(Note 5)1,500,000--

1,500,000

0.665%

February 28, 2025

1,000,000--

1,000,000

0.749%

February 28, 2026

1,000,000--

1,000,000

0.749%

February 28, 2026

1,000,000--

1,000,000

0.409%

July 31, 2021

1,000,000
500,000
500,000--

1,000,000
500,000
500,000

July 31, 2021
July 31, 2021
July 31, 2021

500,000--

500,000

0.409%
0.409%
0.409%
0.900%(Note 5)-1,500,000-

1,500,000-

1,400,000
900,000-

1,400,000
900,000-

500,000-

500,000-

500,000-

500,000-

400,000
400,000-

400,000
400,000-

400,000-

400,000-

400,000-

400,000-

300,000-

300,000-

300,000-

300,000-

1,000,000-

1,000,000

0.509%

August 31, 2022-

400,000-

400,000

August 31, 2022-

1,600,000-

1,600,000

0.509%
0.498%(Note 5)-1,200,000-

1,200,000

0.592%

August 31, 2023-

1,000,000
800,000-

1,000,000
800,000

0.592%
0.592%

August 31, 2023
August 31, 2023-

1,050,000-

1,050,000

0.914%

February 28, 2027-

500,000-

500,000

0.914%

February 28, 2027-

500,000-

500,000

0.914%

February 28, 2027-

500,000-

500,000

0.914%

February 28, 2027-

250,000-

250,000

1,400,000-

1,400,000-

800,000-

800,000-

700,000-

700,000-

1,000,000-

1,000,000

0.914%
0.884%(Note 5)0.825%(Note 5)0.920%(Note 5)1.031%

February 28, 2027--

800,000-

800,000

1.031%

September 30, 2028-

500,000-

500,000

1.031%

September 30, 2028

85,500,000¥103,130,000

21,000,000¥26,700,000

0.799%

August 31, 2024

January 30, 2027

February 2, 2026

August 31, 2022

February 28, 2027
February 28, 2027
September 30, 2026
September 30, 2028

106,500,000¥11,580,000 ¥118,250,000

85Note 1: Annual repayments of long-term loans payable (except for current portion of long-term loans payable) scheduled for the next five years
after the balance sheet date are as follows:
Due after 1 year
through 2 years
Long-term loans payable¥ 9,600,000

Due after 2 years
through 3 years

Due after 3 years
through 4 years(in thousands of yen)
¥13,000,000¥17,750,000

Due after 4 years
through 5 years

Due after 5 years¥11,800,000¥54,350,000

Note 2: Borrowings listed in the current portion of long-term loans payable were listed in long-term loans payable in the previous fiscal period.
Note 3: All debts except for the following Note 5 are borrowing at a floating rate.
Note 4: Average interest rates are the weighted average during the period and figures are rounded to the nearest third decimal place. Also, withregard to borrowings for which interest rate swap transactions were implemented in order to hedge the interest rate volatility risk, theweighted average interest rates taking into consideration the effects of the interest rate swaps are indicated.
Note 5: Borrowings is applied at a fixed rate.
Note 6: All debts were used as the funds for acquiring real estate properties or trust beneficiary interest in real estate (additional expenses areincluded) and repayment of debts.
Note 7: All the repayment methods of debt financing are lump-sum repayments on the due date.
Note 8: Partial prepayment of ¥580,000 thousand was made on November 30, 2018.

8622. DISTRIBUTIONS
15th Fiscal Period(From February 1, 2019 to July 31, 2019)

I. Retained earnings at the end of period

14th Fiscal Period(From August 1, 2018 to January 31, 2019)¥4,125,881,528¥3,875,050,769¥20,000,000¥20,000,000¥3,687,001,854¥3,510,428,187

II. Reversal of voluntary retained earnings
Reversal of reserve for temporary
difference adjustments (Note 1)
III. Total distributions¥4,063¥4,039¥458,879,674¥384,622,582

In accordance with the policy described in Article 38-1 of
its Articles of Incorporation, the Investment Corporation
determines that the amount 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 not exceed its accounting
profits as the maximum amount. Following this policy, theInvestment Corporation has decided that it shall
distribute ¥3,687,001,854, which is the amount deducting
a part of gain on sale of real estate property and otheradjustments from net income and added reversal ofreserve for temporary difference adjustments, as the
distribution of earnings.
Procedures for the distribution of amounts exceeding
distributable income are outlined in Article 38-2 of theInvestment Corporation’s Articles of Incorporation. In the
15th fiscal period, the Investment Corporation has
decided not to distribute cash in excess of distributableprofit.

In accordance with the policy described in Article 38-1 of
its Articles of Incorporation, the Investment Corporation
determines that the amount 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 not exceed its accounting
profits as the maximum amount. Following this policy, theInvestment Corporation has decided that it shall distribute¥3,510,428,187, which is the amount deducting a part ofgain on sale of real estate property and otheradjustments from net income and added reversal ofreserve for temporary difference adjustments, as the
distribution of earnings.
Procedures for the distribution of amounts exceeding
distributable income are outlined in Article 38-2 of theInvestment Corporation’s Articles of Incorporation. In the
14th fiscal period, the Investment Corporation has
decided not to distribute cash in excess of distributableprofit.

Distributions per unit
IV. Retained earnings brought forward to
the next period

Method of calculating distribution amount

Note 1: Reserve for temporary difference adjustments
15th Fiscal Period (February 1, 2019 to July 31, 2019)
The Investment Corporation has reserved ¥2,000,000,000 as reserve for temporary difference adjustments from gain on negative goodwill in
the 13th fiscal period. At least 1% of the initial amount in equal installments over 50 years (100 fiscal periods) will be reversed every fiscal
period applied to distribution starting from the 14th fiscal period distribution. It has been decided that ¥20,000,000 shall be reversed and applied
to distribution in the 15th fiscal period distribution.

14th Fiscal Period (August 1, 2018 to January 31, 2019)
The Investment Corporation has reserved ¥2,000,000,000 as reserve for temporary difference adjustments from gain on negative goodwill in
the 13th fiscal period. At least 1% of the initial amount in equal installments over 50 years (100 fiscal periods) will be reversed every fiscal
period applied to distribution starting from the 14th fiscal period distribution. It has been decided that ¥20,000,000 shall be reversed andapplied to distribution in the 14th fiscal period distribution.

87