Financial Results Appendix
for the 1st Financial Period ended Sep. 2015
November 13, 2015

We seek to invest primarily in neighborhood, communityand other shopping centers that cater to the day-to-day
needs of local area customers with stable demand fromboth customers and retailers, in order to provide stable
investment returns over the long termAppendix 1

Key characteristics of Kenedix Retail REIT Corporation (KRR)Portfolio strategies
Investment criteria

Primary geographic target areas

Focus on the following four elements in making investment decisions:• Four major metropolitan areas,
which have relatively stable populations

Attractiveness

Location• Ability to serve particular day-to-day
needs of local area customers• Demographic composition, number ofhouseholds, competing facilities inlocal retail trade area

• Selective investments in tokureishi andother areas for diversification

The Tokyo metropolitan area

Focus onthe four major
metropolitan
areas

The Greater Osaka area

Profitability

Tenant mix• Occupancy, leasing status, rent level
and lease term

• Optimal tenant mix for the property
considering tenant credit profiles andretail space usage

Target portfolio distribution (based on acquisition price)

The Fukuoka area

The Greater Nagoya area

Investment in land ~Seeking growth opportunities~
We also seek investment opportunities in land of retail properties for daily needs

Retail properties

100%

•

Strong demand from retail tenants to lands (Most land-only properties owned by J-REITs are retail properties)•

Maintain maximum value upon termination of lease term, as the land is expected to be returned as vacant lot•

Investment in lands would be limited to 20% of the portfolio

Flexibility in layout design

Long-term stable cash flows

80%or moreNeighborhood,community and othershopping centers fordaily needs

Better payout ratio

Win-win withtenants

Merits to KRR

Optimize capital efficiency
Merits to tenants• Limited risk of contract termination due tothe fixed term land lease contract as thebuilding is owned by the tenant• Reduced initial cost upon store opening• Stable revenues as tenants cover the repairs
and maintenance expenses• Easier procedure for renovation• Enhanced capital efficiency by not owningland on BS (Improved ROE)

• No depreciation expense• Limited value-depreciation risk upon disaster38

Retail property trends and macroeconomic conditions (1)Population share in Japan by area

Demographic shift in Japan

Shrinking retailtrade area
due to aging
population andconcentrated
population in thefour major
metropolitan areas

（%）

（%）

140

45

60

120

40

100

35

80

30

60

25

40

20

20

15

(million people)

Projections

Projections

0

10
1990

1995

2000

2005

2010

2015

2020

2025

2030

2035

2040

50
40
30
20
1990

65 and over (left axis)
15–64 (left axis)
14 and under (left axis)
Aging rate (right axis)
Source: Ministry of Internal Affairs and Communications, National Institute of Population and Social
Security Research

1995

2000

2005

2010

2015

Four major metropolitan areas

2020

2025

2030

Tokyo metropolitan area

2035

2040
Other areas

Source: Ministry of Internal Affairs and Communications, National Institute of Population and Social
Security Research

Retail market volume in Japan(JPY trillion)
150(JPY trillion)
50

Ownership of monetary assets by age group (as of 2009)
under 30
1%

140

40

Domestic

130

30

consumption led by

120

20

the elderly

60 and
over

110

10

61%

100

70 and over
28%

30s
6%

40s
12%

50s
20%

0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Total retail(left axis)

Groceries(right axis)

Fabrics, apparel and accessories(right axis)

Source: Ministry of Economy, Trade and Industry

Source: Ministry of Internal Affairs and Communications

Basic and selective consumption trends (YoY% change)

Stabledemand fordaily necessities

（%）
8
6
4
2
0
-2
-4
-6
-8
-10

60s
33%

Product types for physical stores or online shopping
Groceries
Medicines
Accessories/Daily commodities
Mobile phones
Pet products
Large furniture
Large electronics
Clothing
Small furniture
Cosmetics
Tickets
PCs
Small electronics
Books
CDs/DVDs/BDs

2006

2007

2008

2009

2010

2011

Basic consumption
Source: Ministry of Internal Affairs and Communications

2012

2013

2014

Selective consumption

2015

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Purchase more frequently at physical stores

Purchase more frequently on the internet

Source: Ministry of Internal Affairs and Communications

Note: "Aging rate" refers to the percentage of the population aged 65 and older.

39

Retail property trends and macroeconomic conditions (2) Retail sales shares by store type(%)

25

Increasein specialty
supermarket
market share

21.8

20

16.5

15

18.1

17.5

17.7

17.4

13.8

12.0
9.9

10
5
0
1991

1994
1997
Specialty supermarkets

1999
GMS

2002

2004
Department stores

2007

2012
Convenience stores2014

Source: Ministry of Economy, Trade and Industry

 Retail property opening applications by property size(%)

Decrease in sizeof retail properties

100
95
90
85
80
75
70
65
0

1.9

3.8

12.6

11.4

2.7
10.4

2.5
9.6

13.8

18.8

69.5

73.0

69.0

FY2005

FY2006

FY2007

13.4

15.3

72.1
FY20045,000m² or less

1.2
3.5

0.8
4.4

18.6

21.4

76.7

73.4

FY2008FY20095,000m²–10,000m²

1.0
2.6

0.7
4.3

1.1
4.3

1.3
3.1

13.4

14.6

15.3

14.5

79.5

83.1

80.4

79.3

81.0

77.4

FY2010FY2011FY2012FY2013

FY2014FY2015(as of June 30)

1.2
3.8
15.6

10,000m²–30,000m²

1.5
4.5
16.5

Over 30,000m²

Source: Ministry of Economy, Trade and Industry"Compact City" policy promoted by the Japanese government through Urban Planning Guidelines
Due to factors such as an aging society, the Japanese government has promoted the "Compact City" policy that encourages the formation ofhighly compact and convenient neighborhoods with high population concentrations

Government
promotion of"Compact City"
We believe that the importance of neighborhood, community and other shopping centersthat cater to the day-to-day needs will increase going forward40

Leveraging extensive support from Sponsor and Alliance Companies
 We seek leveraging extensive support from our Sponsor, Kenedix, Inc., and Alliance Companies forour external and internal growthSponsorAlliance Companies

Other
supportSupport for internal growth

Support forexternal
growthType of support

Pipeline support

●

●

●

●

Warehousing services●●

Leasing services

●

●

●

PM services

●

●

●

Environmentally-friendly technology/
knowhow●

Evaluation of operating conditions
and advisory on operations●

Personnel support●

Right to use trademarks

●

●

●

41

Overview of the Kenedix GroupThe Kenedix Group's strong commitment to J-REITs

The Kenedix Group's total AUM
J-REITs(JPY bn)
1,800

Total AUM: JPY1,638.9 bn (as of end of Sep. 2015)(Note)

J-REIT: JPY1,100.3 bn

Private funds / Private REIT

Proprietary investments

1,638
1,600

69

1,480
Kenedix Office Investment
Corporation

Kenedix Residential
Investment Corporation

Kenedix Retail REIT
Corporation

132

1,400

468

1,206

1,200
Japan Senior Living
Investment Corporation

Japan Logistics Fund Inc.

1,097

Premier Investment
Corporation

161

1,000
844

Private funds

96

438

92

734

496

162

172

542
548

162

Kenedix Private Investment
Corporation

152

1,117

939

Private REIT / Private funds JPY468.7 bn
800

1,111

600

531

432

1,100

349
Note: The Kenedix Group's total AUM includes proprietary investments of JPY699 mn.

400

909

281

Breakdown of AUM as of end of Sep. 2015

613

Proprietaryinvestments
4.3%
Private REIT
Private funds
28.6%

J-REIT
67.1%

0.0%

20.0%

40.0%

60.0%

80.0%

200
291

322

344

387

427

482

0

100.0%

as of
as of
as of
as of
as of
as of
as of
as of
as of
Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, Sep. 30,
2007
2008
2009
2010
2011
2012
2013
2014
2015

42

Overview of Alliance Companies
Sumitomo Mitsui Finance and Leasing Co., Ltd.
 Founded in Feb. 1963 (Leasing business since May 1968)
 Main lines of business: Leasing of a variety of equipment and machinery,loans and factoring, etc.
• Operating assets of JPY3.9 trillion (on a book value basis, as of March
31, 2015). The largest general leasing company in Japan for fiscal year
2014 by lease transaction volume (with consolidated operating assets of
JPY500 bn for the real-estate sector (on a book value basis))• Sourcing transactions through the broad customer base of Sumitomo
Mitsui Banking Corporation
 Description of support• Sourcing of lease properties (pipeline support)• Provision of warehousing services, financing, other services to bridgefunds and personnel support
 Shareholders: Sumitomo Mitsui Financial Group, Inc. (60%), Sumitomo
Corporation (40%)

Nippon Commercial Development Co., Ltd.
 Founded in Apr. 2000
• Listed on the Tokyo Stock Exchange 1st Section and the Nagoya Stock
Exchange 1st Section
 Main lines of business: Real estate investment, sub-leasing / leasing / fundfee businesses• "JINUSHI BUSINESS" to invest in land ownership interests• Successful track record of JINUSHI projects (as of July 31, 2015): 53
projects, approx. 550,000 m2 (land area) and JPY87.0 bn (book value) Description of support• Sourcing of land acquisition opportunities through "JINUSHI BUSINESS"(pipeline support)• Connections with broad tenants, developed through the"JINUSHI BUSINESS"• PM services and tenant leasing services

P&D Consulting Co., Ltd.
 Founded in Aug. 1998
 Main lines of business: Development and management of retail facilities,
retail consulting, etc.
• Development / management of its own brand "Unicus" (10 locations) anddevelopment of other retail facilities (8 locations) (as of Sep. 30, 2015)
 Description of support• Sourcing of properties developed on its own to Kenedix Retail REIT
(pipeline support)• PM services, tenant leasing and other services• Assessment of operating conditions and advisory on operations• Provision of knowhow the company has accumulated throughdevelopment / management of retail facilities• Right to use "JINUSHI"-related trademarks
 JINUSHI BUSINESS• Nippon Commercial Development's "JINUSHI BUSINESS" is a businessmodel whereby they invest in land ownership interests and lease the land
to tenants based on commercial fixed-term land lease agreements togenerate stable cash flow (rent) in the long term
 Characteristics of Nippon Commercial Development's"JINUSHI BUSINESS"

Investments in land assets
which can be converted toresidential use

Seek long-term stable
cash flow

Governance structure
Decision-making process for acquisition and sale of properties

Preparation of
proposal

Asset
Investment
Department of
Retail REIT
Division

Confirmation of
proposalCompliance
Officer

Relatedparty
transaction

Deliberation
andResolution

Deliberation
andResolution

Compliance
Committee

AssetManagement
Relatedparty
Committee oftransaction
Retail REIT
Division

Other transactions

Deliberation
andResolution

Relatedparty
transaction

Our board of
directors

ReportAsset
Manager's
board ofdirectors

Other transactions

Investment in Kenedix Retail REIT by the Kenedix GroupAs of October 31, 2015, The Kenedix Group owns about 1.6% (5,750 units) of our total issued units.

Introduction of DPU-linked management fee structure
Fee linked with distribution
per unit

We believe the DPU-linked asset management fee structure will encourage the Asset Manager to place utmost
emphasis on the growth of income from portfolio properties.

The Kenedix Group's business model that benefits from our growth
As of Sep. 30, 2015, the Kenedix Group is the only real estate investment manager in Japan whose J-REIT assets constitute the majority of their AUM.
Because of the importance of the J-REIT business to the Kenedix Group, we believe that our sound growth is in line with their interests.

44

Appendix 2

Detailed financial results and portfolio information

Earnings performance for the individual properties (1)Location

Tokyo metropolitan area

Property No.

T-1

T-2

T-3

T-4

T-5

T-6

T-7

T-8

Property
Name

Fululu Garden Yachiyo

MONA
Shin-Urayasu

Passaggio Nishiarai

Daikanyama Address
Dixsept

Unicus Ina

Yorktown
Kita-Kaname

Unicus Yoshikawa

Sports Club
Renaissance
Fujimidai

Acquisition
Date

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Price
Information

Acquisition price (In millions of yen)

14,848

8,063

5,850

5,390

4,379

4,000

3,600

2,586

Percentage of total portfolio

16.2%

8.8%

6.4%

5.9%

4.8%

4.4%

3.9%

2.8%

Net book value (In millions of yen)

15,048

8,223

5,964

5,454

4,411

4,038

3,657

2,607

Appraisal value (In millions of yen)

15,100

8,360

6,200

5,450

4,430

4,220

3,690

2,640

15.8%

8.7%

6.5%

5.7%

4.6%

4.4%

3.9%

2.8%

1

1(11)

1
3,120.87

Ratio

49

1(72)

1(40)

1(26)

1

Leasable floor area (m2)

77,057.56

9,568.31

10,546.25

5,056.39

13,044.37

Leased floor area (m2)

76,707.48

9,376.34

10,366.25

4,748.56

13,044.37(Note)

10,620.04
10,620.04

3,120.87

99.5%

98.0%

98.3%

93.9%

100.0%

100.0%

100.0%

100.0%

Operating periods

233 days

233 days

233 days

233 days

233 days

233 days

233 days

233 days(1)Rental and other operating revenues(In thousands of yen)

978,001

672,980

404,875

324,660

169,248

167,013

Rental revenues

811,299455,106

265,884

228,139

168,590

163,317

Other operating revenues

166,701

217,873

138,991

96,521

6573,695(2)Property-related expenses(In thousands of yen)

396,759

323,537

177,631

176,144

14,28233,313

Property management fees

183,801

108,392

59,76067,224

2,303

Taxes

21

8

14

8

120

Utilities

106,108

90,86960,68850,921--

Repairs and maintenance

37,462

25,716

7,269

10,892

10,7791,344

Insurance

2,423

1,056

705

396

420

320

Trust fees and other expenses

66,941

97,49349,192

46,701

658

584

148,515

154,966

143,055

133,699

83,144

19,50838,27626,327

20,526

19,757129,007

116,689

116,728

113,172

63,386

1,085

-

-

-

-

147,430

154,966

143,055

133,699

83,144

Number of tenants

Lease
Information

Occupancy ratio as of March 31, 2015

Income andRetained
Earnings
Information
for the 1st
Fiscal Period(3)NOI(=(1)-(2))
581,241
349,442
227,244(In thousands of yen)(4)Depreciation
106,010
52,094
41,615(In thousands of yen)(5)Rental operating income (=(3)-(4))
475,231297,348
185,628(In thousands of yen)(6)Capital expenditures
21,56970,767
26,814(In thousands of yen)(7)NCF (=(3)-(6))
559,672
278,674
200,430(In thousands of yen)
Note: We have not obtained consent from the tenants of the relevant property to release the information from the table.

(Note)

30,854209(Note)

46

Earnings performance for the individual properties (2)Location

Greater Osaka area

Property No.

O-1

O-2

Greater Nagoya area

O-3

O-4

Piago Kahma
Central SquareHome Center
Takadono (Land)
Omihachiman

N-1

N-2

Fukuoka area
N-3

Tokureishi and other areas

F-1

R-1

R-2

R-3

Kahma Home
K’s Denki
CenterValor
Nakagawa
Nakagawa
Ichinomiya-Nishi
Tomita (Land)
Tomita (Land)

Sunny Noma

Roseo Mito

K’s Denki
Aomori
HontenSuper Sports
Xebio
Aomori-Chuo

Property
Name

BlumerMaitamonAcquisition
Date

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Apr. 16, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

Feb. 10, 2015

8,389

2,685

2,140

11,000

2,311

2,174

889

1,497

9,675

1,469

898

Acquisition price (In millions of yen)

Price
Information

Percentage of total portfolio

9.1%

2.9%

2.3%

12.0%

2.5%

2.4%

1.0%

1.6%

10.5%

1.6%

1.0%

Net book value (In millions of yen)

8,498

2,727

2,178

11,494

2,351

2,199

907

1,527

9,871

1,499

913

Appraisal value (In millions of yen)

8,820

2,870

2,390

11,600

2,500

2,200

945

1,500

10,300

1,590

901

9.2%

3.0%

2.5%

12.1%

2.6%

2.3%

1.0%

1.6%

10.8%

1.7%

0.9%

1

1

1

1

1(22)

1

1

45,654.67

10,083.41

Ratio

48

1

2

1(41)

Leasable floor area (m2)

30,037.11

4,437.07

14,313.00

24,185.02

29,888.11

4,437.07

14,313.00

24,055.88

9,447.48(Note)

2,814.67

Leased floor area (m2)(Note)

9,447.48

2,814.67

45,654.67

10,083.41(Note)

99.5%

100.0%

100.0%

99.5%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

Operating periods

233 days

233 days

233 days

168 days

233 days

233 days

233 days

233 days

233 days

233 days

233 days(1)Rental and other operating
revenues (In thousands of yen)630,766

473,998

456,990

Rental revenues

456,479

347,234

410,834

Other operating revenues

174,286

126,763

46,155(2)Property-related expenses(In thousands of yen)

251,684

194,174

70,036

Property management fees

78,705

Number of tenants

Lease
Information

Blumer
HAT Kobe

Occupancy ratio as of March 31,
2015

Income and Taxes
Retained
Utilities
Earnings
Information Repairs and maintenancefor the 1st Insurance
Fiscal Period
Trust fees and other expenses

33

-

-

(Note)(Note)

78,791
3

-

-

-

-

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

23,645
12

123,290

78,36237,857

17,58019,441

3,043

1,059

900

841

31,013

16,675

4,635(3)NOI(=(1)-(2))
379,081
54,744
119,519
279,824(In thousands of yen)(4)Depreciation
65,995
13,654
48,200(In thousands of yen)(5)Rental operating income (=(3)-(4))
313,086
54,744
105,864
231,623(In thousands of yen)(6)Capital expenditures
10,231658(In thousands of yen)(7)NCF (=(3)-(6))
368,850
54,744
119,519
279,166(In thousands of yen)
Note: We have not obtained consent from the tenants of the relevant property to release the information from the table.

--(Note)(Note)

83,082

96,38031,86555,040386,953

69,65540,389-19,321-

18,97855,745

8,444

6,498

83,082

77,05931,86536,062331,20761,21033,890

-

-

-

-

-

-

-

83,082

96,38031,86555,040386,953

69,65540,38947

Balance sheet(in thousands of yen)
Reporting Period(As of Sep. 30, 2015)
AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Noncurrent assets
Property, plant and equipment
Construction in progress
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment, net
Intangible assets
Leasehold right trust
Other
Total intangible assets
Investments and other assets
Lease and guarantee deposits
Lease and guarantee deposits in trutst
Long-term prepaid expenses
Long-term deposits
Total investments and other assets
Total noncurrent assets
Deferred assets
Deferred organization expenses
Investment unit issuance costs
Total deferred assets
Total assets(in thousands of yen)
Reporting Period(As of Sep. 30, 2015)

Liabilities
3,950,551
7,829,874
163,767
16,7632,071,748
10,783
14,043,489

96,74525,766,439-518,285
25,248,154
1,118,727-35,074
1,083,653
29,194-869
28,324
26,211-1,231
24,97966,910,436
12,02593,404,319

Current liabilities
Operating accounts payable
Short-term loans payable
Accounts payable-otherAccrued expenses
Income taxes payable
Advances received
Deposits received
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Asset retirement obligations
Total noncurrent liabilities
Total liabilities

330,055
2,000,000
257,8543,412
6,321
518,706
359,954
3,476,305
36,350,000
20,0008,722,663
22,901
45,115,565
48,591,870

Net assets
Unitholders’ equity
Unitholders’ capital
Surplus
Unappropriated retained earnings
Total surplus
Total unitholders’ equity
Total net assets
Total liabilities and net assets

57,857,000
1,933,270
1,933,270
59,790,270
59,790,270
108,382,141

171,078
2,445
173,523
10,0005,320
418,520
124,960
558,800
94,136,642
40,501
161,506
202,008
108,382,141

48

Statement of income and retained earnings(in thousands of yen)(in thousands of yen)
Reporting Period(From October 3, 2014
to September 30, 2015)

Reporting Period(From October 3, 2014
to September 30, 2015)
A.

Operating revenues
Rent revenue-real estate
Other lease business revenue
Total operating revenue

Rental and other operating revenues

4,128,035

Rental revenues
Rental revenues from limited proprietary
rights of landCommon area charges

975,033
5,103,069

Operating expenses
Expenses related to rent business
Asset management fees

Rental and other operating revenues

2,246,179

Subtotal

313,577

3,643,804
220,680
263,549
4,128,035

OthersAsset custody fees

5,761

Parking space rental revenues

126,629

Administrative service fees

20,258

Utility charge reimbursement

500,044

Directors’ compensation

8,931

Miscellaneous

348,360

Other operating expenses

45,112

Subtotal

Total operating expenses

2,639,820

Operating income

2,463,248

Total rental and other operating revenues
B.

Interest income

1,071

Total non-operating income

1,071

Property-related expenses
Expenses related to rent business
Property management fees and facility
management fees
Utilities

Non-operating income

Non-operating expenses

975,033
5,103,069

Taxes

655,263
548,099
1,280Interest expenses

208,576

Repairs and maintenance

Borrowing related expenses

262,279

Insurance

9,662

Amortization of deferred organization expenses

10,049Trust fees

12,214

Amortization of investment unit issuance costs

43,605

Depreciation

560,957

Total ono-operating expenses

524,510

OthersOrdinary income

1,939,809

Income before income taxes

1,939,809

Current

6,539

Total income taxes

6,539

Net income

1,933,270

Unappropriated retained earnings

1,933,270

C.

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

144,732

313,968
2,246,179
2,856,889

49

Statement of cash flows(in thousands of yen)
Reporting Period(From October 3, 2014 to September 30, 2015)
Net cash provided by (used in) operating activities
Income before income taxes

1,939,809

Depreciation and amortization

561,321

Amortization of deferred organization expenses

10,049Amortization of investment unit issuance costs

43,605Interest income-1,071

Interest expenses

208,576

Decrease (increase) in operating accounts receivable
Decrease (increase) in consumption taxes refund receivable-163,767-2,071,748

Decrease (increase) in prepaid expenses-16,763

Increase (decrease) in operating accounts payable

304,096

Increase (decrease) in accounts payable-other257,854

Increase (decrease) in advances received

518,706

Increase (decrease) in deposits received

359,954

Decrease (increase) in long-term prepaid expenses-418,520

Decrease (increase) in long-term deposits-124,960

Payment of organization expenses
SubtotalInterest income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities-50,551
1,356,591
1,071-205,164-217
1,152,280

Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Purchase of property, plant and equipment in trust
Purchase of intangible assets-96,745-93,814,364-2,809Purchase of intangible assets in trust-176,383

Payments for lease and guarantee deposits-10,000

Payments for lease and guarantee deposits in trust-5,320

Proceeds of tenant leasehold and security deposits

20,000

Repayments of tenant leasehold and security deposits in trust-393,751

Proceeds from tenant leasehold and security deposits in trust

9,116,415

Payments of restricted bank deposits in trust-3,917,992

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

287,569-88,993,382

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

10,222,500

Decrease in short-term loans payable-8,222,500

Proceeds from long-term loans payable

36,350,000

Proceeds from issuance of investment units

57,651,888

Other
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of period
Cash and cash equivalents at the end of period-10,783
95,991,104
8,150,002
8,150,002

50

Appraisal value (properties as of September 30, 2015)
Applicable valuation rate
Income capitalization approach value
No.

Property nameAppraisal
dateAppraisal value(JPY mn)

Direct capitalization method

DCF method

Direct cap rate (%)
Previous

LatestChanges

Previous

LatestDiscount rate (%)

Changes

Previous

LatestTerminal cap rate (%)

Changes

Previous

LatestChangesT-1

Fululu Garden Yachiyo

Sep. 30, 2015

15,00015,100

100

4.9

4.8

-0.1

4.7

4.6

-0.1

5.1

5.0

-0.1

T-2

MONA Shin-Urayasu

Sep. 30, 2015

8,340

8,360

20

5.4

5.4

0.0

5.1

5.1

0.0

5.6

5.6

0.0

T-3

Passaggio Nishiarai

Sep. 30, 2015

6,020

6,200

180

4.6

4.5

-0.1

4.4

4.3

-0.1

4.8

4.7

-0.1

T-4

Daikanyama Address Dixsept

Sep. 30, 2015

5,400

5,450

50

4.2

3.9

-0.3

4.0

3.7

-0.3

4.4

4.1

-0.3

T-5

Unicus Ina

Sep. 30, 2015

4,410

4,430

20

5.2

5.2

0.0

4.9

4.9

0.0

5.4

5.4

0.0

T-6

Yorktown Kita-Kaname

Sep. 30, 2015

4,120

4,220

100

5.2

5.1

-0.1

5.0

4.9

-0.1

5.4

5.3

-0.1

T-7

Unicus Yoshikawa

Sep. 30, 2015

3,630

3,690

60

5.0

4.9

-0.1

4.8

4.7

-0.1

5.2

5.1

-0.1

T-8

Sports Club Renaissance Fujimidai

Sep. 30, 2015

2,600

2,640

40

4.9

4.8

-0.1

4.7

4.6

-0.1

5.1

5.0

-0.1

O-1

Blumer Maitamon

Sep. 30, 2015

8,520

8,820

300

5.7

5.5

-0.2

5.8

5.6

-0.2

5.9

5.7

-0.2

O-2

Central Square Takadono (Land)

Sep. 30, 2015

2,700

2,870

170

-

-

-

4.6

4.4

-0.2

4.8

4.6

-0.2

O-3

Piago Kahma Home Center
Omihachiman

Sep. 30, 2015

2,390

2,390

0

6.9

6.5

-0.4

6.6

6.2

-0.4

7.1

6.7

-0.4

O-4

Blumer HAT Kobe

Sep. 30, 2015

11,20011,600

400

5.1

5.0

-0.1

4.9

4.8

-0.1

5.3

5.2

-0.1

N-1

Kahma Home Center Nakagawa
Tomita (Land)

Sep. 30, 2015

2,380

2,500

120

-

-

-

5.1

4.8

-0.3

5.2

4.9

-0.3

N-2

Valor Ichinomiya-Nishi

Sep. 30, 2015

2,190

2,200

10

5.4

5.4

0.0

5.1

5.1

0.0

5.6

5.6

0.0

N-3

K’s Denki Nakagawa Tomita (Land)

Sep. 30, 2015

903

945

42

-

-

-

5.1

4.8

-0.3

5.2

4.9

-0.3

F-1

Sunny Noma

Sep. 30, 2015

1,500

1,500

0

5.2

5.2

0.0

5.0

5.0

0.0

5.6

5.6

0.0

R-1

Roseo Mito

Sep. 30, 2015

9,780

10,300

520

5.6

5.7

0.1

5.3

5.3

0.0

5.8

5.8

0.0

R-2

K’s Denki Aomori Honten

Sep. 30, 2015

1,590

1,590

0

5.9

5.9

0.0

5.6

5.6

0.0

6.1

6.1

0.0

R-3

Super Sports Xebio Aomori-Chuo

Sep. 30, 2015

901

901

0

5.9

5.9

0.0

5.6

5.6

0.0

6.1

6.1

0.0

93,574

95,7062,132

Total / Average

Note: “Previous” refers to appraisal value at the previous appraisal dated October 1, 2014, except for Blumer HAT Kobe, dated March 1, 2015. “Latest” refers to the latest appraisal date. Discount rate for DCF method shows the discount rate for the nearest period.

51

Appraisal value (properties newly acquired related to PO)
Income capitalization approach value
No.

Property nameAppraisal date

Appraisal value(JPY mn)

Direct capitalization
methodDCF method

Direct cap rate (%)

Discount rate (%)

Terminal cap rate (%)

T-9

Super Viva Home Iwatsuki (Land)

Jul. 1, 2015

5,210

－

4.7

－

T-10

K’s Denki Shonan-Fujisawa (Land)

Jul. 1, 2015

3,410

－

4.6

－

T-11

Unicus Kamisato (Land)

Jul. 1, 2015

3,010

－

4.7

－

T-12

Unicus Konosu (Land)

Jul. 1, 2015

1,730

－

4.6

－

T-13

Inageya Yokohama Minamihonjuku(Land)

Jul. 1, 2015

1,460

－

4.0

4.6

T-14

Gourmet City Chiba-Chuo

Jul. 1, 2015

780

5.3

5.1

5.5

O-5

Carino Esaka

Jul. 1, 2015

6,580

4.9

4.6

5.1

O-6

COMBOX Komyoike

Jul. 1, 2015

6,840

5.3

5.0

5.5

O-7

Hankyu Oasis Hirakatadeguchi

Jul. 1, 2015

1,290

5.7

5.5

5.9

O-8

Welcia Kishiwadakamori (Land)

Jul. 1, 2015

500

－

4.0

4.6

R-4

Ashico Town Ashikaga

Jul. 1, 2015

5,050

5.4 (Building)
5.0 (Land)

5.2 (Building)
5.0 (Land)

5.6 (Building)R-5

Yorktown Shinden-Higashi

Jul. 1, 2015

3,320

5.6

5.4

5.8

R-6

Kasumi Technopark Sakura

Jul. 1, 2015

847

5.3

5.1

5.5

40,027－－

Total / Average－

Note: Discount rate for DCF method shows the discount rate for the nearest period.

52

Unitholder information (as of Sep. 30, 2015)
Ownership ratio by investor type
1.1%

Major unitholders

14.8%

Rank

Name

# of
(%)(Note)
units held

1

JAPAN TRUSTEE SERVICES BANK, LTD.
(Trust Acct.)

38,22214.65%

2

THE MASTER TRUST BANK OF JAPAN, LTD.
(Trust Acct.)

24,577

9.42%

3

TRUST & CUSTODY SERVICE BANK, LTD.
(Securities Investment Trust Acct.)

16,332

6.26%

4

THE BANK OF NEW YORK MELLON SA/NV 10

9,242

3.54%

Number of unitholders by investor type

5

BARCLAYS BANK PLC A/C CLIENT
SEGREGATED A/C PB CAYMAN CLIENTS

7,976

3.05%

1.5%

6

STATE STREET BANK AND TRUST COMPANY
505225

6,620

2.53%

7

CBLDN-STICHTING PGGM DEPOSITARY – LISTEDREAL ESTATE PF FUND

6,388

2.44%

8

THE NOMURA TRUST AND BANKING CO., LTD.
(Investment Trust Acct.)

6,102

2.34%

9

KENEDIX, INC.

5,750

2.20%

10

NORTHERN TRUST CO. (AVFC) RE COLONIAL
FIRST STATE INVESTMENTS LIMITED

5,748

2.20%

38.4%
260,750
units

40.9%
4.7%
Individuals andothersFinancial
institutions(38,496 units) (106,723 units)

2.8%

Other domestic
corporations

ForeignInvestors

Brokerage
firms(12,292 units) (100,250 units) (2,989 units)

0.3%

0.8%

8,954
unitholders

94.6%

Individuals andothers(8,473)Financial
institutions(69)

Other domestic
corporations(255)

ForeignInvestors(134)

Brokerage
firms
(23)

Note: figures are based on # of units and rounded down to the 2nd decimal place

53Portfolio overview
Tokyo metropolitan area
Fululu Garden
T-1 Yachiyo

T-2 MONA Shin-Urayasu T-3 Passaggio Nishiarai

T-5 Unicus Ina

T-6 Kaname

T-7 Unicus Yoshikawa

Super Viva Home
T-9 Iwatsuki (Land)

K’s Denki ShonanT-10 Fujisawa (Land)

Unicus Kamisato
T-11 (Land)

Yorktown Kita-

Daikanyama Address

T-4 Dixsept

R-2

Sports Club

T-8 Renaissance Fujimidai

R-3

R-5

R-4

R-1

R-6

NEW
Unicus Konosu
T-12 (Land)

NEW

NEW

Inageya Yokohama
Gourmet City ChibaT-13 Minamihonjuku (Land) T-14 Chuo

Greater Nagoya area
NEW

NEW

N-1

NEW

Kahma Home Center
Nakagawa Tomita(Land)

Valor Ichinomiya-

N-2 Nishi

K’s Denki Nakagawa

N-3 Tomita (Land)

Greater Osaka area
O-1 Blumer Maitamon

Central Square

O-2 Takadono (Land)

Piago Kahma Home

O-3 Center Omihachiman O-4 Blumer HAT Kobe
Tokureishi and other areas
K’s Denki Aomori

R-1 Roseo Mito

O-5 Carino Esaka

O-6 COMBOX Komyoike

Hankyu Oasis

O-7 Hirakatadeguchi

NSC

SM

NEW

CSC

Urban Station-Front SC

NEW

SS

Super Sports Xebio

R-3 Aomori-Chuo

WelciaO-8 Kishiwadakamori(Land)

Fukuoka area
F-1 Sunny NomaNEW

R-2 Honten

Ashico Town

R-4 Ashikaga

Yorktown Shinden-

R-5 Higashi

Kasumi Technopark

R-6 Sakura

NEW

NEW

NEW

NEW

54

Portfolio list
Total acquisition
price

JPY129,763 mn

No.

Name of property

Total appraisal
value

Portfolio
appraisal
NOI yield

JPY135,733 mn

Location(city / ward, prefecture)

Acquisition price(JPY mn)

5.4%

Appraisal value(JPY mn)

Weighted averageoccupancy rate

Numberof tenants

99.0%

Appraisal NOI yield(%)

Occupancy rate (%)

388

Number oftenants

T-1

Fululu Garden Yachiyo

Yachiyo, Chiba

14,848

15,100

5.2

99.5

49

T-2

MONA Shin-Urayasu

Urayasu, Chiba

8,063

8,360

6.1

98.0

72

T-3

Passaggio Nishiarai

Adachi ward, Tokyo

5,850

6,200

5.0

98.3

40

T-4

Daikanyama Address Dixsept

Shibuya ward, Tokyo

5,390

5,450

4.3

93.9

26

T-5

Unicus Ina

Kitaadachi-gun, Saitama

4,379

4,430

5.4

100.0

1

T-6

Yorktown Kita-Kaname

Hiratsuka, Kanagawa

4,000

4,220

5.4

100.0

1

T-7

Unicus Yoshikawa

Yoshikawa, Saitama

3,600

3,690

5.1

100.0

11

T-8

Sports Club Renaissance Fujimidai

Nerima ward, Tokyo

2,586

2,640

4.9

100.0

1

O-1

Blumer Maitamon

Kobe, Hyogo

8,389

8,820

5.8

99.5

48

O-2

Central Square Takadono (Land)

Osaka, Osaka

2,685

2,870

4.8

100.0

1

O-3

Piago Kahma Home Center Omihachiman

Omihachiman, Shiga

2,140

2,390

7.5

100.0

2

N-1

Kahma Home Center Nakagawa Tomita (Land)

Nagoya, Aichi

2,311

2,500

5.2

100.0

1

N-2

Valor Ichinomiya-Nishi

Ichinomiya, Aichi

2,174

2,200

5.9

100.0

1

N-3

K's Denki Nakagawa Tomita (Land)

Nagoya, Aichi

889

945

5.2

100.0

1

F-1

Sunny Noma

Fukuoka, Fukuoka

1,497

1,500

5.4

100.0

1

R-1

Roseo Mito

Mito, Ibaraki

9,675

10,300

5.7

100.0

22

R-2

K's Denki Aomori Honten

Aomori, Aomori

1,469

1,590

6.7

100.0

1

R-3

Super Sports Xebio Aomori-Chuo

Aomori, Aomori

898

901

6.4

100.0

1

O-4

Blumer HAT Kobe

Kobe, Hyogo

11,00011,600

5.3

99.5

41

NEW

T-9

Super Viva Home Iwatsuki (Land)

Saitama, Saitama

4,815

5,210

4.3

100.0

1

T-10

K’s Denki Shonan-Fujisawa (Land)

Fujisawa, Kanagawa

3,169

3,410

5.0

100.0

1

T-11

Unicus Kamisato (Land)

Kodama-gun, Saitama

3,000

3,010

4.6

100.0

1

T-12

Unicus Konosu (Land)

Konosu, Saitama

1,700

1,730

4.6

100.0

1

T-13

Inageya Yokohama Minamihonjuku (Land)

Yokohama, Kanagawa

1,442

1,460

4.5

100.0

1

T-14

Gourmet City Chiba-Chuo

Chiba, Chiba

760

780

5.7

100.0

1

O-5

Carino Esaka

Suita, Osaka

6,555

6,580

5.3

99.1

30

O-6

COMBOX Komyoike

Izumi, Osaka

6,450

6,840

6.0

100.0

1

O-7

Hankyu Oasis Hirakatadeguchi

Hirakata, Osaka

1,280

1,290

5.9

100.0

1

O-8

Welcia Kishiwadakamori (Land)

Kishiwada, Osaka

487

500

4.5

100.0

1

R-4

Ashico Town Ashikaga

Ashikaga, Tochigi

4,180

5,050

6.4

92.7

25

R-5

Yorktown Shinden-Higashi

Sendai, Miyagi

3,252

3,320

6.0

100.0

2

R-6

Kasumi Technopark Sakura

Tsukuba, Ibaraki

830

847

5.6

100.0

1

Note: “Appraisal value” of 18 assets properties acquired at the listing and Blumer HAT Kobe, “Occupancy rate” and “number of tenants” are as of September 30, 2015. “Appraisal value” of 13 properties acquired at October 2, 2015 is as of July 1, 2015.
“Appraisal NOI yield” is based on the latest appraisal report at the acquisition date..

55

CSC Community
Shopping Center

Fululu Garden Yachiyo
Acquisition price

JPY14,848 mn

Location

Yachiyo, Chiba

Land area

Ito-Yokado building:
22,207.34 m2
Specialty store building: 23,292.14 m2

GFA

Ito-Yokado building:
50,960.84 m2
Specialty store building: 65,698.32 m2

Core tenant

Ito-Yokado Co., Ltd.

Appraisal NOI

JPY773 mn

Appraisal NOI yield

5.2%

1. Property features
 Opened in October 2002
 Competitive tenants include a major casual clothing store, sporting goods store,
a baby goods store and a specialty discount retailer

Enlarged view

Yachiyo GC

文 The top retail facility within a 3 km radius
 Conveniently located on National Route 16 with easy car access文

Yachiyo Wide-area Park文

文

Murakami Station

Yachiyo Chuo

2. Overview of retail trade area
 An 8% increase in population within a 1 km radius from 2005 to 2010

Toyo Rapid Railway
Keisei Main Line
Shizu
Katsutadai
Keisei Owada
Yukarigaoka
Takanodai CC

Yachiyo City Office

Fululu Garden Yachiyo

Toyo Katsutadai Station

Yachiyodai

Katsutadai Station
文“Appraisal NOI” and “Appraisal NOI yield”, herein after are based on the latest appraisal report at the acquisition date.

56

NSC Neighborhood
Shopping Center

Blumer Maitamon
Acquisition price

JPY8,389 mn

Location

Kobe, Hyogo

Land area

54,838.70 m2

GFA

36,349.60 m2

Core tenant

EDION Corporation

Appraisal NOI

JPY490 mn

Appraisal NOI yield

5.8%

1. Property features
 Consists of approximately 45 tenants, including a supermarket (grocery), an
electronic appliance store, a major clothing store and a baby goods store as thecore tenants

Kobe-Awaji-Naruto Expressway

Tamon-Kodera Line

 Large parking area encircled by a two-story retail building

Shin-Kobe
Gakuentoshi• 1 km radius: 18,000 people• 3 km radius: 179,000 people• 5 km radius: 414,000 people The surrounding area encompasses the corner of a new residential development
and the property continues to benefit from such expansions

Sun Kobe Golf Garden

文

Maitamonguchi

Blumer Maitamon

2. Overview of retail trade area
 Population in the surrounding retail trade area:

Enlarged view

Gakuen-minami IC
Daini- Shinmei Kita Line文

Sannomiya

Tarumi Police Station
文

Akashi Maiko
Gakuen-minami IC
Tarumi

文

文
文
文

文
文

Tarumi JCT

文

Akashi Kaikyo Ohashi Bridge

57

NSC Neighborhood
Shopping Center

Unicus Ina

1. Property features
 Opened in April 2006
 Core tenants: a supermarket (grocery), a drug store, a specialty discount retailer,
clothing stores and a movie rental store
2. Overview of retail trade area
 The surrounding area is within a land readjustment project area designated forurbanization
 The population in the surrounding areas has continued to increase on the backof continued development and sale of residential properties
 A marked increase in Ina city's population relative to its surrounding cities with a
5.8% population increase during the years 2009–2014

Acquisition price

JPY4,379 mn

Location

Kitaadachi-gun, Saitama

Land area

32,553.16 m2

GFA

14,160.04 m2

Core tenant

P&D Consulting

Appraisal NOI

JPY235 mn

Appraisal NOI yield

5.4%

Joetsu Shinkansen Line
Inamachi Town Office
Uchijuku
Hanuki
Inachuo
Okegawa
Shiku
Kita-ageo
Maruyama
HasudaAgeo

文

Enlarged view

Kenmin Katsudo
Sougou Center

文

Choseishiko Memorial Park

Shonan文

Unicus Ina
文

文

Hanuki Station
Omiya

58

Urban Station-Front
Shopping Center

MONA Shin-Urayasu

1. Property features
 Opened in November 1990
 Directly accessible by a pedestrian walkway from Shin-Urayasu Station which hasa daily passenger traffic of over 100,000 people Approximately 70 tenants, ranging from supermarkets (grocery), clothing stores,
restaurants, commercial goods stores to service businesses
2. Overview of retail trade area
 Population in the surrounding retail trade area:• 1 km radius: 33,000 people• 3 km radius: 205,000 people• 5 km radius: 510,000 people• 4–5% of population increase in 3–5 km radius from 2005 to 2010 17 minute train-ride from Tokyo Station and only 1 station from Maihama station,
where Tokyo Disney Resort is located The area surrounding Shin-Urayasu Station, an entrance to highly popular
residential areas, has significant growth potential as a commercial district

Acquisition price

JPY8,063 mn

Location

Urayasu, Chiba

Land area(Note)

15,875.86 m2 (for a single building)

GFA(Note)

76,767.24 m2 (for a single building)Core tenant

Undisclosed

Appraisal NOI

JPY493 mn

Appraisal NOI yield

6.1%

文

Urayasu City Office

文

Urayasu IC

文

文

文

Shin-Urayasu Station
文
文

MONA Shin-Urayasu

文
文

文

Juntendo University
Urayasu Hospital

文

文

Meikai University

59

NSC Neighborhood
Shopping Center

Unicus Yoshikawa

 Opened in September 2011
 A supermarket (grocery) and a hardware store are its core tenants, inaddition to 8 specialty and service stores such as a dental office, a dry
cleaner, a beauty salon, a music school and a veterinary clinic
 Conveniently located on a heavily traveled road that runs across
Yoshikawa city
Acquisition price

JPY3,600 mn

Kitakoshigaya

Nakagawa River
Yoshikawa City Office

Koshigaya

Location

Yoshikawa, Saitama
22,239.94 m2

GFA

11,450.70 m2

JPY9,675 mn

Location

Mito, Ibaraki

Land area

73,940.62 m2

GFA

A:
B:
C:
D:
E:
F:

Enlarged view

138.32 m2
9,684.79 m2
4,549.60 m2
13,047.79 m2
330.75 m2
265.65 m2

Kohnan Shoji Co., Ltd.
JPY184 mn
5.1%Core tenant

LIXIL Viva Corporation

Appraisal NOI

JPY554 mn

Kairaku-en

Mito

Ibaraki Prefectural
Government
Mito-minami IC
Ibarakimachi
Higashi IC

Enlarged view

Ibaraki Prefectural
Government

Roseo Mito

文

文

Appraisal NOI
yield

Acquisition price

Musashino Line文

Appraisal NOI Opened in April 2009, with a supermarket (grocery) and a hardware store as
its core tenants
 Located in a highly accessible area by car Families with young children in the surrounding area are increasing due tothe abundance of new residential developments

Yoshikawaminami

Koshigaya Laketown

Shin-Misato

Core tenantRoseo Mito

Yoshikawa

Minamikoshigaya

Land area

NSC Neighborhood
Shopping Center

Unicus Yoshikawa
Yoshikawa Station
文

文

Appraisal NOI
yield

5.7%

文

60

Urban Station-Front
Shopping Center

Urban Station-Front
Shopping Center

Passaggio Nishiarai

Daikanyama Address Dixsept

 Opened in April 2010
 Highly stylish building with an atrium at the center and retail stores
located from the basement floor to the fourth floor The surrounding area has recently experienced a significant inflow offamilies with young children due to large-scale residential development

 Opened in August 2000 as a landmark property in Daikanyama The property occupies the retail section of a large multi-complex facility
in Daikanyama
 In addition to sophisticated and stylish retailers typically found in
Daikanyama, the property also houses tenants that cater to day-to-day
needs of customers, such as a supermarket (grocery), a drug store and avariety goods store

Acquisition price

JPY5,850 mn

Acquisition price

Location

Adachi ward, Tokyo

Tobu Daishi Line

JPY5,390 mn
文Land area

5,079.68 m

Ring Road No.7
Nishiarai
Station2
文

GFA

21,996.90 m

Core tenant

Undisclosed

Appraisal NOI

JPY289 mn
5.0%

Shibuya ward, Tokyo

Land area

17,262.00 m2(for a single building)GFA

92,064.43 m2(for a single building)Core tenant

Undisclosed

Appraisal NOI

JPY232 mn

Appraisal NOI yield

4.3%

2

Passaggio Nishiarai

文Appraisal NOI yield

Location

Daikanyama Address Dixsept
T-siteDenmark Embassy
Daikanyama Station

Komazawa-dori文

61 Opened in April 2009 with York Mart, a supermarket (grocery), as its coretenant, in addition to an electronics appliance store, a drug store, aspecialty discount retailer and restaurant The property plays an important role in the local community due to its
central location and the synergy between the tenants, which cater to theneeds of local area customers
Acquisition price
Location

JPY4,000 mn

IseharaHiratsuka, Kanagawa

Land area

9,996.36 m2

GFA

8,528.68 m2

SSSpecialty Store A well-equipped membership-based health club with a gym, two studios
and a pool on the basement to the second floors

Acquisition price
Location

Tsurumaki-onsen

Sports Club Renaissance
Fujimidai

JPY2,586 mn
Nerima ward, Tokyo

YorkMart Co., Ltd.

Appraisal NOI

JPY214 mn

Tokai 文University

Appraisal NOI yield

5.4%

文

文

文

文

Tokai-daigaku-mae
Hiratsuka IC

Land area

1,729.24 m2

GFA

3,109.74 m2

Core tenant

Renaissance Inc.

Appraisal NOI

JPY127 mn

Appraisal NOI yield

4.9%

Ohne Park
Tokai-daigaku-mae Station

Core tenant

Yonsho-dori

NSC Neighborhood
Shopping Center Yorktown Kita-Kaname

Sports Club
Renaissance Fujimidai

文

文

Fujimidai Station

Yorktown Kita-Kaname

文
文

文

Tokai University
文

文

Enlarged view

62

SM

Supermarket

Central Square Takadono(Land)

 Central Square Takadono, a supermarket, opened on the land in July
2015. Life Corporation, the tenant, operates numerous other stores in thesurrounding area based on the "dominant strategy" Located in a densely populated area bordering central Osaka, which isserviced extensively by multiple major train lines
Acquisition price

JPY2,685 mn

NSC Neighborhood
Shopping Center

Piago Kahma Home Center
Omihachiman Opened in 2005 and consists of two buildings, Piago Omihachiman, a UNY
Group Holdings supermarket, and Kahma Home Center Omihachiman The property's retail trade area surrounding Omihachiman Station consists
primarily of residential properties including condominiums, with a highconcentration of families with young children within a 1 km radius
Acquisition price

JPY2,140 mn

Location

Omihachiman, Shiga

Land area

29,410.00 m2

GFA

12,283.85 m2(aggregate of 2 buildings)

Core tenant

UNY Co., Ltd.

Appraisal NOI

JPY161 mn

Appraisal NOI yield

7.5%

Lake Biwa

Sekime-takadono

Location

Osaka, OsakaLand area

4,437.07 m2

GFA‐

Core tenant

Life Corporation

Morishouji

Tenjinbashisuji 6-chome

SekimeTanimachi Line
Osaka
Sakuranomiya
Tenma
Umeda
KyobashiAzuchi

ShiginoOsaka Castle

Central Square Takadono
文

Omihachiman City Office
Omihachiman

Enlarged view

文

文
文

文

Appraisal NOI

JPY127 mn

Sekime-Takadono Station

Omihachiman Station
文

文

Appraisal NOI yield

4.8%

文

Enlarged view

Sekime-Seiiku Station

Piago Kahma Home Center
Ohmihachiman

63

SS

Specialty Store

Kahma Home Center Nakagawa Tomita (Land)
K's Denki Nakagawa Tomita (Land) An integrated retail zone is formed in the surrounding area, together with asupermarket (grocery) and a sporting goods store on the adjacent lot All stores in this zone were opened in 2013 and create synergy witheach other
Kahma Home Center Nakagawa Tomita (Land)
Acquisition price

JPY2,311 mn

Location
Land area
GFA
Core tenant
Appraisal NOI
Appraisal NOI yield

Nagoya, Aichi
17,431.00 m2‐
DCM KAHMA CO.,LTD.
JPY120 mn
5.2%

K's Denki Nakagawa Tomita (Land)
Acquisition price
JPY889 mn
Location
Nagoya, Aichi
Land area
5,560.23 m2
GFA‐Core tenant
Undisclosed
Appraisal NOI
JPY46 mn
Appraisal NOI yield
5.2%

NagoyaHarutaHatta
Fushiya

Arako

Shonai River

Haruta Station

Shinkawa River文NSC Neighborhood
Shopping Center

Valor Ichinomiya-Nishi

 Opened in 2002, with Valor, a successful supermarket chain in the Chubu
region, as its core tenant, in addition to an electronic appliance store and ahealth club operated by Valor Group Located 1.1 km from major train stations which are a 10-minute train-ridefrom Nagoya
 The residential area surrounding Owari Ichinomiya Station, conveniently
serviced by various railways and roads, is a commuter town for Nagoya

Acquisition price

JPY2,174 mn

Location

Ichinomiya, Aichi

Land area

16,736.18 m2

GFA

9,447.48 m2

Core tenant

Valor Co., Ltd.

Appraisal NOI

JPY128 mn

Appraisal NOI yield

5.9%

Owari Ichinomiya

Ichinomiya JCT

Kiyosu JCT

Nagoya文

Ichinomiya City Office

K's Denki Nakagawa Tomita

Valor Ichinomiya-Nishi
Fushiya Station

文

文
文

文

Shubun University

Hachikuma-dori
文

文

Kahma Home Center
Nakagawa Tomita

Enlarged view

文
文

Enlarged view

64

SM

Supermarket

SS

Sunny Noma

Specialty Store

K's Denki Aomori Honten
Super Sports Xebio Aomori-Chuo
Ouu Main Line

Aomori Prefectural
Government
Aomori City Office

AomoriShin-aomori
Tohoku Shinkansen Line

Aomori Expressway

Super Sports Xebio Aomori-Chuo
文
K's Denki
Ito-Yokado Aomori
Aomori Honten
Aomori Kyoritsu Hospital
Aomori-chuo IC

Murakami Hospital
Sanwa Arena
Aomori

Enlarged view The supermarket which was originally built in 1970 and enjoyed strong
support from the local community, was rebuilt in 2007
 Sunny Noma is the strongest performing supermarket among other Sunnysupermarkets that operate in the surrounding area
 The closest station to the property is 3 train stops, or a 5 minute ride, fromthe central urban areas of Fukuoka
 The area is popular among single people and families with young children
Acquisition price

Fukuoka City Subway Kuko Line

JPY1,497 mn
Ohori Park

Location

Fukuoka, Fukuoka

Land area

5,973.03 m2(including leaseholdinterest)

GFA

2,814.67 m2

HakataK's Denki Aomori Honten

Super Sports Xebio Aomori-Chuo

Acquisition price

JPY1,469 mn

Acquisition price

JPY898 mn

Location

Aomori, Aomori

Location

Aomori, Aomori

Land area

7,725.42 m2

GFA4,684.12 m2

Takamiya

Enlarged view

Takamiya Station

2

Tsutaya/Hard Off:K's Denki:

8,872.04 m
8,296.06 m2

GFA

Tsutaya/Hard Off:K's Denki:

2

Core tenant

Denkodo Co., Ltd.

Core tenant

XEBIO Corporation

Appraisal NOI

JPY98 mn

Appraisal NOI

JPY57 mn

Appraisal NOI yield

6.7%

Appraisal NOI yield

6.4%

Land area

Ohashi

文

3,644.72 m
6,346.50 m2

文

文

Core tenant

Fukuoka
AirportNishitetsu
Fukuoka(Tenjin) Opened in 2005 in Hamada District in Aomori, which has the highest
concentration of retail properties with a significant inflow of suburban retailers,
including Ito-Yokado, since a land readjustment project launched in 1996
 With National Route 103 on the east and Route 120 on the west running
through the city and National Route 7 (Aomori Kanjo Bypass) on the south, thedistrict brings customers from a broad retail trade area that covers the entire
Aomori city area

Seiyu GK文
文

Appraisal NOI

JPY81 mn

Sunny Noma
文
文

Appraisal NOI yield

5.4%

文

文

Kyushu University

文

Ohashi Station

文

65

NSC Neighborhood
Shopping Center

Urban Station-Front
Shopping Center

Blumer HAT Kobe

Carino Esaka

Landmark NSC in "HAT Kobe District", a revival symbol project from the Kobe earthquake

Attractively located near Esaka Station, only 5 stops/10 minutes away from Umeda Station

Opened in October 2005 as a landmark in the "HAT Kobe District," an area redeveloped as a symbol ofreconstruction from the Kobe earthquakeThe retail portion of a multi-use shopping complex with shopping centers on its lower floors and a hotel inthe upper floors



Tenants include a cinema complex, a grocery store, clothing stores and restaurants

Accessible from Nada Station (1 stop from Sannomiya) and Iwaya Station (2 stops from Kobe Sannomiya).
Also easily accessible by car from Hanshin Expressway Route 3 and National Route 2

One of the landmark shopping centers in the neighborhood of Esaka Station with a well-known variety
goods store as the anchor tenant

Residential population in the surrounding retail trade area has been on the rise since 2005

1-minute walk from Esaka Station, which is only 5 stops or 10 minutes away from Umeda Station. The retailtrade area is popular among families with young children due to its accessibility to the city center and highquality living environment
Kita-Osaka Kyuko Line

JPY11,000 mn

Location

Kobe, Hyogo

Shin-Kobe

Nada

Acquisition price

JPY6,555 mn

Location

Suita, OsakaLand area

5,830.66 m2 (*)

GFA

42,681.56 m2 (*)

Core tenant

Tokyu Hands Inc.

Appraisal NOI

JPY344 mn

Appraisal NOI yield

5.3%

Amagasaki

SannomiyaLand area

19,116.12 m2

GFA

50,538.47 m2

Core tenant

Tokyu Recreation Co., Ltd.

Kobe City OfficeSuita

Shonai

Iwaya
Hyogo Prefectural
Government

Esaka

Toyonaka IC
Midosuji Line

Acquisition priceShin-Osaka

Yodo River

Juso

Umeda
Kobe

Kobe Port Tower

Enlarged view

Nada
StationOsaka

Kyobashi

Enlarged view

Iwaya
StationAppraisal NOI
Appraisal NOI yield

JPY577 mn
5.3%

Blumer HAT Kobe
Kasuganomichi
Station

Hyogo
Prefectural
MuseumCarino Esaka
Esaka Station
Midosuji Line66

Urban Station-Front
Shopping Center

NSC Neighborhood
Shopping Center

COMBOX Komyoike

Ashico Town Ashikaga

Largest retail property in the Komyoike Station area, housing multiple large-scale specialty stores

Cinema complex wing is scheduled to re-open, with P&D Consulting as sub-property manager

 Located in the central commercial area of Senboku New Town Komyoike A large-scale multi-tenant NSC with thorough renovation conducted in November 2014,
consisting of multiple wings, including wings for the shopping mall and cinema complex

 Houses approximately 40 stores, including a grocery store, a home electronic wholesaler, ageneral sporting goods store, a furniture and interior store, a baby and children’s store andcasual clothing stores Connected to Komyoike Station by a pedestrian deck, further accessible to Namba Station in
the heart of Osaka in approximately 30 minutes by train

 Tenants feature highly recognizable national chain stores, including a grocery store, asporting goods store, clothing retailers, a specialty discount retailer, and a bookstore Easily accessibly by car due to its location along a major local avenue. Also highly accessible
from distant regions with IC of Expressway located within 3km to the north Single-lot houses, condominiums and residences spans from the north and south in thesurrounding area, and a new condominium project is planned near the property
Shin-Kobe

Acquisition price

JPY6,450 mn

Shin-Osaka

Omata

Acquisition price

Osaka
Sannomiya

Ashikaga IC

Nanba

Location

Kita-Kanto Expressway

JPY4,180 mn

Location

Izumi, Osaka

Ashikaga, Tochigi

Ota-Kiryu
IC

Ashikaga
Ashikagashi

TomitaSano

Nakamozu

Land area

17,027.63 m2 (*)

GFA

44,737.41 m2 (*)

Core tenant

Daiwa Royal Co., Ltd.

KansaiInternational
AirportHarukiSenboku Rapid Railway
Izumi
Chuo

Land area

101,808.44 m

GFA

Shopping mall: 18,101.06m2 ; Expansion: 430.74m2
Cinema complex: 7,200.15m2 ; Road-side wing: 698.31m2

Core tenant

Cainz Corporation

Appraisal NOI

JPY269 mn

Appraisal NOI yield

6.4%

Ota

Komyoike

Enlarged view

Tobu
Isesaki Line2

Enlarged view

Komyoike
StationAppraisal NOI

JPY388 mn

Appraisal NOI yield

6.0%

COMBOX Komyoike

Ashikaga
City Office
Ashikaga
StationTobu
Isesaki Line

Ashikagashi
Station Ashico Town Ashikaga(*) Figures for the whole building are shown in the table

67

NSC Neighborhood
Shopping Center

Super Viva Home Iwatsuki (Land)SS

Specialty store

K's Denki Shonan-Fujisawa (Land)

Underlying land with strong value growth potential, in the proximity to a national route

Easy car access and more than ten years remaining on a long-term fixed business lease Underlying land of an NSC which opened in February 2013

 Land-only property houses a stand-alone store for K’s Denki, which opened in July 2008

 The NSC comprises a large hardware store, a grocery supermarket and a food court

 More than ten years remain on a long-term fixed business land lease with K’s Holdings

 The target trade areas include adjacent cities, as the property is within a short distance to anumber of major routes

 Faces major routes, which give the property a wide retail trade area, including a dense
mixture of single-family homes and logistics and other facilities in the nearby area

Acquisition priceOld
Arakawa

JPY4,815 mn

HigashiIwatsukiAcquisition price

JPY3,169 mn

Location

Fujisawa, Kanagawa

OdakyuRailway

Ebina

Iwatsuki67,325.95 m2

GFA-Core tenant

LIXIL Viva Corporation

Appraisal NOI

JPY207 mn

Omiya

Omiya Ward
OfficeLand area

15,578.58 m2

GFA-Core tenant

K’s Holdings Corporation

Appraisal NOI

JPY159 mn

SagamiLine

SagamiRailway
Chogo

Shonandai

Enlarged view

Enlarged view
Iwatsuki
Iwatsuki
Station
City OfficeTobu Noda
Line

Ayase City
OfficeEbina JCT

Odakyu Enoshima LineLand area

Atsugi
Ken-O Expressway

Iwatsuki IC

Saitama, Saitama

Atsugi IC

LocationOld
Arakawa

OdakyuEnoshima
Line

Yoda Bypass
Isuzu Motors

Chogo
StationShonandai
StationK's Denki Shonan-Fujisawa

Appraisal NOI yield

4.3%

Iwatsuki IC

Super Viva Home Iwatsuki

Appraisal NOI yield

5.0%

Keio
University

Tama
University

68

NSC Neighborhood
Shopping Center

NSC Neighborhood
Shopping Center

Unicus Kamisato (Land)

Unicus Konosu (Land)

Underlying land of a shopping center with a cinema complex in the Kamisato area

Underlying land of one of the largest shopping centers in the Konosu area

 Underlying land of an NSC developed by P&D with a total store floor area of 13,000 m 2

 Underlying land of an NSC developed by P&D which opened in September 2010, with a total
store floor area of 6,400 m 2

 The NSC is competitive due to its concentration of highly recognizable tenants including a
supermarket as the core tenant, a drug stores, and a cinema complex

 The NSC comprises a grocery supermarket as the anchor tenant Located close to major prefectural road and national roads with high accessibility by car fromall directions
Takasaki

Acquisition price Easy access by car given its location facing the largest trunk road within the relevant tradearea, and highly visible due to the wide store front

Isesaki

JPY3,000 mn

Acquisition price

Maebashiminami IC

JPY1,700 mn

Kumagaya
Kazo

Gyoda

Kanetsu Expressway

Fukiage

Location

Kodama-gun, Saitama
Jinbohara

Land area
GFA

67,854.47 m2

Tone
River

Gunmafujioka
Joshinetsu
Expressway

-

Honjo

Location

Konosu, Saitama
KonosuLand area

19,329 m2 (provisional replotting)
Kanetsu
Expressway

Honjo-Kodama
IC
Honjowaseda

GFA-Core tenant

P&D Consulting Co., Ltd.

Appraisal NOI

JPY77 mn

Appraisal NOI yield

4.6%

Enlarged view

Core tenant

P&D Consulting Co., Ltd.

Appraisal NOI

JPY138 mn

Arakawa

Honjo
StationKen-O
Expressway

Gyoda
Station

4.6%(underconstruction)

JoetsuShinkansen

TakasakiLine

Unicus Konosu
Fukiage
StationUnicus Kamisato

Appraisal NOI yield

Kuki-Shiraoka
JCT

Honjowaseda
StationEnlarged view

69

NSC Neighborhood
Shopping Center

Yorktown Shinden-Higashi

SM

Inageya Yokohama Minamihonjuku

Supermarket(Land)

Located in a rapidly-growing commuting neighborhood close to central Sendai

Underlying land of a March 2015-opened supermarket in a highly populated trade area

 An NSC opened in November 2004 with a supermarket and a hardware store as core tenants

 Underlying land of Inageya grocery supermarket opened in March 2015

 Located in eastern Sendai, 10 minutes by train to Sendai Station from the nearest KozuruShinden Station

 Community-based supermarket attracting customers from the highly populated residential
district to the northeast and southeast of the property

 Development of residential areas is underway in the surrounding area, particularly of singlefamily houses

 Approx. 14 minutes by train to Yokohama Station from the nearest Futamatagawa Station,
which has about 80,000 daily passengers on average

Acquisition price

JPY3,252 mn

Location

Sendai, Miyagi

Land area
GFA

Higashisendai
TohokuMain Line

KozuruShinden

Senseki LIne

Nigatake

Nigatake IC

SendaiSendai-Tobu
Road

33,081.87 m2 (partly on leasehold)
12,272.42 m

Sendaihigashi
IC

2

Acquisition price

JPY1,442 mn

Location

Yokohama, Kanagawa

Land area

4,405.41 m2

GFA-

York-Benimaru Co., Ltd.

Core tenant

Inageya Corporation

Appraisal NOI

JPY196 mn

Appraisal NOI

JPY64 mn

Appraisal NOI yield

4.5%

ShinYokohama

Hodogaya IC
Tsurugamine
Yokohama
Shinhodogay
IC

Enlarged view

Sendai Shimin
Baseball Stadium
Tohoku Shinkansen
Higashisendai
StationKozuru Shinden
Tohoku Main Line
Station
Senseki LIne

Enlarged view

Core tenant

Yokohama Line

Tomei
Expressway

HodogayabypassFutamatagawa
StationMinamihonjuku
IC

Yorktown Shinden-Higashi

Appraisal NOI yield

6.0%

Nigatake IC

Inageya Yokohama Minamihonjjuku

Nigatake Station

70

SM

Hankyu Oasis Hirakatadeguchi

Supermarket

SM

Kasumi Technopark Sakura

Supermarket

Supermarket located in a highly populated area, with 10,000 residents within a 500m radius A 24-hour operated store of a leading supermarket brand headquartered in Tsukuba

 A Hankyu Oasis grocery supermarket combining a bakery and a specialty discount store,
opened in August 2006

 A 24-hour Kasumi supermarket opened in May 1997, with a sales floor area of 1,563 m 2

 25 minutes from the nearest Kozenji Station to Yodoyabashi Station in central Osaka, making
it highly convenient for commuters The retail trade area includes the college town of Tsukuba University, with Tsukuba
University’s campus located to the west of the property

 Many single-family houses and relatively new condominiums located nearby, with young
families A major development of single-family residences planned in a nearby site

Acquisition price

Suita
JCT

JPY1,280 mn

 Kasumi is headquartered in Tsukuba, and has a dominant presence in the area

Hirakatashi
KozenjiAcquisition price

JPY830 mn

Location

Tsukuba, Ibaraki

Land area

5,157.72 m2

GFA

2,047.65 m2

Core tenant

Kasumi Co., Ltd.

Tsukuba University
Tsuchiurakita
IC

KorienLocation

Hirakata, Osaka

Esaka
Shin
Osaka

Land area

4,978.38 m2

GFA

2,961.02 m2

Core tenant

Hanshoku Co., Ltd.

Yodo
River
Kadoma
JCT

Umeda

Osaka
Yodoyabashi

KyobashiAppraisal NOI

JPY75 mn

Appraisal NOI yield

5.9%

Tsukuba Chuo
IC
Tsukuba JCT

Enlarged view

Enlarged view
Yodo
River

TsukubaDaijukai
Hospital

Hankyu Oasis
Hirakatadeguchi
Kozenji
StationAppraisal NOI

JPY46 mn

Appraisal NOI yield

5.6%

Tsukuba
University

Kasumi Technopark Sakura

Tsukuba
University ofTsukuba Technology
University
Tsukuba Gakuin
University
TsukubaKenkyu-gakuen
StationStation71

SM

Gourmet City Chiba-Chuo

Supermarket

SS

Specialty Store

Welcia Kishiwadakamori (Land)A 24-hour supermarket housing a clinic in the complex

Underlying land of a leading domestic drug store brand newly opened in 2015

 The retail portion of Qiball, a joint public and private facility located near the Chiba
Prefectural Office Underlying land of a Welcia store opened in March 2015, which also sells groceries andfeatures a boxed lunch store on its premises

 Opened in September 2007, comprising Gourmet City, a 24-hour supermarket, on the firstfloor, and a clinic on the second floor Welcia has many stores in the local area and has a dominant presence in the area

 Large daytime population given the concentration of government offices in the area
 The areas to the east of the property dominated by residential districts with condominiums
and single-family houses, with the population in the surrounding retail trade area rapidly
increasing due to development of large-scale condominiums
Acquisition price

JPY760 mn

Keisei
Makuhari

Makuhari 30 minutes by train from the nearest Izumi-Omiya Station to Namba Station in central Osaka Surrounded by residential districts dominated by single-family houses, expecting customers
on bicycles as well as those coming to the property by car

Miyagino JCT

Shin-Kobe

Acquisition price

JPY487 mn

Shin-Osaka
Osaka

Sannomiya
Namba

Location

Chiba, Chiba

KaihinMakuhari

Location

Kishiwada, OsakaLand area

3,033.45 m2

GFA-Core tenant

Welcia Yakkyoku Co., Ltd.

Chiba

Land area

6,614.13 m2
Chiba City Hall

GFA

49,829.47 m2

Core tenantDaiei, Inc.

Chiba Chuo

Enlarged view

Gourmet City Chiba-Chuo

JPY43 mn

HarukiKansaiInternational
Airport Izumi-Omiya

Enlarged view

Sakaecho Station

Chiba Station
Keiseichiba
StationAppraisal NOI

Chiba
Prefectural
OfficeSakai JCT

Komyoike

Welcia Kishiwadakamori
Haruki
StationAppraisal NOI

JPY21 mn

Appraisal NOI yield

4.5%

Yoshikawakoen
StationAppraisal NOI yield

5.7%

Chiba Chuo Station

Izumi-Omiya Station

72

Disclaimer
The contents in this document are provided solely for informational purposes and not intended for the purpose ofsoliciting investment in, or as a recommendation to purchase or sell, any specific products.

This document contains charts/diagrams/tables/data and others Kenedix Real Estate Fund Management ("the AssetManager") created based on data, indices, etc. published by third parties, in addition to the information related toKenedix Retail REIT Corporation ("the Investment Corporation"). This document also contains the current
analyses/judgments/other opinions of the Asset Manager.
The Asset Manager is a financial instruments business operator under the Financial Instruments and Exchange Act.
The information provided herein is unaudited and hence no assurance or warranties are given with respect to theaccuracy or completeness thereof. Also, please be aware that the analyses/judgments/other opinions provided by the
Asset Manager may change or cease to exist without prior notice of any kind as they are based on current assumptions
and beliefs of the Asset Manager.

Neither the Investment Corporation nor the Asset Manager shall be liable for any errors/inaccuracies of thedata/indices/other information published by third parties (including the data based on the appraisal report).
This document also contains forward-looking statements and anticipation of future results for the Investment
Corporation. However, no guarantees are given with respect to the accuracy of these statements/anticipation.

Revised editions of this document will be posted on our website (http://www.krr-reit.com/) should there be majorcorrections going forward.

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