August 16, 2011
To All Concerned Parties
Issuer of Real Estate Investment Trust Securities
1-1, Nihonbashi-Muromachi 2-chome, Chuo-ku, Tokyo 103-0022
Nippon Accommodations Fund Inc.
Executive Director Yuji Yokoyama(Code number 3226)
Investment Trust Management Company
Mitsui Fudosan Accommodations Fund Management Co., Ltd.
President and CEO Kosei Murakami
Contact CFO and Director Morio Shibata(TEL 03-3246-3677)

Notification Concerning Acquisition ofDomestic Real Estate Trust Beneficiary Interest
This is a notification that Nippon Accommodations Fund Inc. (“NAF”) decided on and completed the acquisitionof real estate trust beneficiary interest in Japan as shown below.

1. Reason for Acquisition
Based on the provisions for investments and policies on asset management provided in the Articles ofIncorporation, the decision to acquire the following property was made to ensure the steady growth of theentire portfolio, and for the diversification and further enhancement of the investment portfolio in Tokyo’s 23
wards.

2. Overview of Acquisition(1)

Name of property acquired (Note 1)

Park Cube Higashi Shinagawa(2)Type of property acquired

Trust beneficiary interest(3)

Acquisition price (Note 2)¥6,060,000 thousand(4)

Appraised value (Note 3)¥6,110,000 thousand (as of June 30, 2011)(5)

Date of conclusion of sales contract

August 1, 2011

(6)

Date of handoverAugust 1, 2011

(7)

SellerHigashishinagawa Holding TMK(8)Acquisition funds

Borrowings and own funds(9)

Method of payment

Full payment at time of delivery(Note 1)

The current name of the property acquired is “Glenpark Higashi-Shinagawa.” NAF plans to rename theproperty as stated above without delay after it has acquired the property.

(Note 2)“Acquisition price” denotes the trading value (exclusive of miscellaneous expenses for acquisition, fixed
property taxes, urban planning taxes, consumption taxes, and local consumption taxes) specified in the trust
beneficiary interest sales contract for the property acquired.

(Note 3)

“Appraised value” is based on the amount mentioned in the real estate appraisal report which Daiwa Real
Estate Appraisal Corporation prepared for the property acquired.

1

3. Description of Property Acquired(1) Outline of the property acquired
Name of property acquired
Type of property acquired
Trustee
Trust period
Acquisition price (Note 1)
Appraisal company
Appraised value (Note 2)
Date of value appraisal
Location
Residence indication
Building-to-land ratio
Floor-area ratio
Land
ZoningSite area (Note 3)
Ownership form
Completion date (Note 4)
Structure / number ofstories (Note 5)
Uses (Note 5)
Gross floor area (Note 5)
Ownership form
Rentable units
Rentable area
Existence of security interests
Special affairs (Note 6)
Building

Special features of the property

Details of tenants(Note 7)Park Cube Higashi Shinagawa
Trust beneficiary interest
Mitsubishi UFJ Trust and Banking Corporation
From March 23, 2007 to July 31, 2021
¥6,060,000 thousand
Daiwa Real Estate Appraisal Corporation¥6,110,000 thousand
June 30, 2011
11-5, Higashi-Shinagawa 3-chome, Shinagawa-ku, Tokyo
60％
300％
Light-industrial area
3,120.65㎡
Proprietorship
February 28, 2007
Flat-roofed reinforced concrete structure / 15 stories
Apartment building / garage
11,351.67㎡
Proprietorship
201
10,636.67㎡
None
None
The property is a seven-minute walk from Tennozu Isle Station on
the Rinkai Line, an eight-minute walk from Shinagawa Seaside
Station on the Rinkai Line, a nine-minute walk from Shimbamba
Station on the Keikyu Main Line and a 10-minute walk from
Tennozu Isle Station on the Tokyo Monorail. This is a very
favorable location in terms of accessibility as the Shinagawa
Seaside Station is only six-minutes from JR Osaki Station and
12-minutes to Shibuya Station. Haneda Airport is also very
accessible with Tokyo Monorail.
Additionally, the area has become an advanced commercial area
thanks to redevelopment in recent years, with high-rise officebuildings and large shopping centers gathered around Shinagawa
Seaside Station and skyscraper office buildings around Tennozu
Isle Station.
Demand can be expected mainly from DINKS households seeking
convenient access to office areas, as well as families with children,and businesspersons employed near the internationalizing Haneda
Airport.

Total number of tenants
Rentable units
Rented units
Rentable area
Rented area
Occupancy rate
Deposit

1
201
171
10,636.67 ㎡
8,991.85 ㎡
84.5%¥66,614 thousand

Total rental revenues

Please refer to <Attached Document 1> Summary of theappraisal report on the amount of the property acquired.

2

(Note 1)“Acquisition price” denotes the trading value (exclusive of miscellaneous expenses for acquisition, fixed
property taxes, urban planning taxes, consumption taxes, and local consumption taxes) specified in the trust
beneficiary interest sales contract for the property acquired.

(Note 2)

“Appraised value” and “Date of value appraisal” are based on the amount mentioned in the real estateappraisal report which Daiwa Real Estate Appraisal Corporation prepared for the property acquired.

(Note 3)“Site area” of the “Land” item denotes the land area as entered in the register.

(Note 4)“Completion date” of the “Building” item denotes the date as entered in the register.

(Note 5)“Structure / number of stories,” “Uses,” and “Gross floor area” are stated based on the entries in the register.

(Note 6)

“Special affairs” denotes matters which NAF recognizes as important as of today, taking into consideration
their effects on title-related matters, use, appraised value, profitability, etc. of the property acquired.

(Note 7)

Description of the “Details of tenants” column:(i)“Total number of tenants” is denoted as “1” where a master lease contract (blanket lease contract) has
been concluded with a master lease company. As to the property acquired, NAF has concluded a master
lease contract with the master lease company, that is, Mitsui Fudosan Housing Lease Co., Ltd. The
above “Total number of tenants” means the total number of tenants after conclusion of the said master
lease contract.

(ii) “Rentable units” denotes the number of rentable units in the property acquired.
(iii) Figures for “Rented units,” “Rented area,” and “Deposit” are based on information provided by the seller,
valid as of July 22, 2011.
(iv) “Rentable area” denotes the total rentable area of the building of the property acquired.
(v) “Occupancy rate” is the ratio of “Rented area” to “Rentable area” and is rounded to one decimal place.

(2) Outline of investigations into the state of the building, etc.
Consigned investigatingcompany
Urgent repair cost
Short-term repair cost
Investigations
into the state of
the building

Earthquake risk
diagnosis(Note)

Sumitomo Mitsui Construction Co., Ltd.
－¥173 thousand

Repair and renewal costs
expected to be necessary
within 12 years¥150,029 thousand

Replacement value¥3,017,967 thousand

Report date ofinvestigations into the stateof the building

July 8, 2011

PML value (Note)

9.8%

The PML value is based on a report on earthquake risk diagnosis made by Sumitomo Mitsui Construction
Co., Ltd. However, the report on earthquake risk diagnosis only states the views of the consigned
investigating company and does not provide any guarantee for its contents. PML (Probable Maximum Loss)represents the rate of probable maximum loss to be caused by earthquakes. In this case, it means theextent of damage to be caused by one of the biggest earthquakes anticipated to happen within the expected
duration of service (the biggest earthquake which happens once every 475 years = 10% chance of a big
earthquake happening once every 50 years) represented by the rate (%) of the estimated cost of restorationfrom the damage to the replacement cost.

Profile of third party investigative body
Trade Name
Head office address
Representative
Description of principal operations
CapitalRelationship with NAF and Investment
Trust Management Company

Sumitomo Mitsui Construction Co., Ltd.
1-6, Tsukuda 2-chome, Chuo-ku, Tokyo
Yoshiyuki Norihisa, President and Chief Executive Officer
Design and construction of civil engineering, building, prestressed
concrete work and related operations, and other¥12,003 million
None3

4. Outline of Seller
Trade name
Address
Representative

Higashishinagawa Holding TMK
56-15, Kameido 6-chome, Koto-ku, Tokyo－ (Note)Purpose

1. Transfer of specified asset according to securitization plan based on the Act
on Securitization of Assets, and business related to its management anddisposal
2. Other business associated with business related to securitization of specified
asset above

Date of establishment
Specified capitalPreferred capital
Investor

February 19, 2007
¥100,000¥550 million－ (Note)Relationship with NAF
and Investment TrustManagement Company

There are no direct or indirect investments in the seller either form NAF, theInvestment Trust Management Company, nor any related parties or associatedcompanies of NAF and the Investment Trust Management Company. Also, there
are no capital, personal or business relationships to report between the seller’s
investors (including original investors) and NAF, the Investment TrustManagement Company, and any related parties or associated companies of
NAF and the Investment Trust Management Company.

(Note)

Representative and investors are undisclosed as consent could not be obtained from the seller.

5. Transactions with Related Parties and the Like
The property acquired has not been acquired from a party classified as having a relationship of special
interest with NAF or the Investment Trust Management company. Since Mitsui Fudosan Housing Lease Co.,
Ltd., which became the master lease company and property management company as of today, falls under“Related parties and the like” (Note) according to NAF’s self-established rules on asset management relevant
to transactions with related parties and the like, the master lease contract and property management contract
have been carried out through deliberation and decision by the compliance committee of the Investment TrustManagement Company and the investment committee.
(Note)“Related parties and the like” means related parties and the like of an Investment Trust Management
Company which has concluded an asset management contract with NAF, as determined in the Order for
Enforcement of the Act on Investment Trust and Investment Corporation, Article 123.

6. Situation of the Acquired Property
Not applicable.

7. Earthquake Resistance Matters
NAF outsourced the inspection and verification of the details of earthquake-resistant structures including
structural calculation sheets and, for corresponding building, obtained confirmation that, no falsification issuspected in the structural calculation and structural drawings with respect to their structure, which ensures
earthquake resistance as per the Building Standards Act.
In addition, NAF examines earthquake risks during the course of due diligence upon acquisition of properties,
from perspectives that are different from those of building certification investigations performed by aninspection and certification agency, by inspecting designs and performing on-site reviews using structural
drawings, structural calculation sheets and other information.

48. Outline of Brokerage(1) Outline of broker
Trade nameHead office address
Representative

Mitsubishi UFJ Trust and Banking Corporation
4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo
Kinya Okauchi, President

Description of principle
Trust business and otheroperations
Capital¥324,279 million
Date of establishment
March 10, 1927
Relationship with NAF and Investment Trust Management Company
There are no capital relationships to report between NAF or the Investment TrustManagement Company, and the broker. Also, there are no capital relationships
Capital relationships
to report between any related parties or associated companies of NAF or theInvestment Trust Management Company, and any related parties or associatedcompanies of the broker.
There are no personal relationships to report between NAF or the Investment
Trust Management Company, and the broker. Also, there are no personal
Personal relationships relationships to report between any related parties or associated companies of
NAF or the Investment Trust Management Company, and any related parties or
associated companies of the broker.
There are no business relationships to report between NAF or the Investment
Trust Management Company, and the broker. Also, there are no businessBusiness relationships relationships to report between any related parties or associated companies of
NAF or the Investment Trust Management Company, and any related parties or
associated companies of the broker.
The broker does not fall under the category of related parties of NAF or the
Applicability to related Investment Trust Management Company. Also, the related parties andparties
associated companies of the broker do not fall under the category of relatedparties of NAF or the Investment Trust Management Company.
(2) Amount of brokerage fee
Not disclosed by request of the broker.

9. Outlook for Management of the Properties after Acquisition
The impact of the acquisition on NAF’s results for the period ending August 2011 (March 1, 2011 to August 31,
2011) will be minor, and there will be no change to the financial results forecast of the period.

*

This English language notice is a translation of the Japanese language notice dated August 1, 2011
and was prepared solely for the convenience of, and reference by, overseas investors. NAF makes
no warranties as to its accuracy or completeness.

<Attached Documents>
1. Summary of the appraisal report on the amount of the property acquired
2. Portfolio list after the acquisition of the property is completed (on an acquisition price basis)
3. Photos of exterior and entrance of the property acquired5<Attached Document 1> Summary of the appraisal report on the amount of property acquired(unit: Thousands of yen)Appraised value (specified value)
Assessment item(a) Unit rental revenues, including commons area
fees(b) Utilities revenues

Details
424,7560(c) Parking lot revenues

17,400(d) Other revenues

6,209

Revenues from key money, etc.

Operatingrevenues

Operatingexpenses

6,110,000

0Renewal fees

5,043

Other revenues

1,166(1): (a)+(b)+(c)+(d)448,366(e) Total loss from vacancies, etc.

26,277(f) Loss on bad debts(2) Operating revenues [(1)-(e)-(f)]422,088(g) Maintenance expense

11,535(h) Utilities expense

3,475(i) Repair expense

10,458(j) Property management fees

14,596(k) Tenant soliciting fee, etc.

10,381(l) Taxes and public dues

22,713(m) Property insurance fee

1,047(n) Other expenses

2,364(3) Operating expenses[(g)+(h)+(i)+(j)+(k)+(l)+(m)+(n)]76,5730(4) Net operating income [(2)-(3)]345,515(o) Earnings from temporary deposit(p) Capital expenditures

1,364
8,703

(5) Net income [(4)+(o)-(p)]338,175(6) Cap rate

5.5％

Value of earnings calculated by the direct capitalization method[(5)+(6)]6,150,000

Value calculated by discounted cash flow method

6,090,000

Discount rate

5.2％

Terminal cap rate

5.8％

Cost method value

4,960,000

Total value of land and building

4,957,194

Land value
Building value
Adjustment

2,213,419
2,743,775
0

NAF requested real estate appraisal by Daiwa Real Estate Appraisal Corporation, Inc. for the property
acquired, based on points to note when appraising real estate from the Act on Securities Investment Trustand Securities Investment Corporations, and based on the Act on Real estate Appraisal (1963 Act No. 152,
including later amendments) and on real estate appraisal standards. The above figures record a summaryof the real estate appraisal report prepared. The appraisal valuation is the judgment and opinion of the6appraiser at a fixed point in time, with no guarantees as to the validity or accuracy of the report, nor the
possibility of transactions at the appraised value.
Yen amounts are rounded down to the nearest thousand yen.

7

<Attached Document 2> Portfolio list after the acquisition of the property is completed (on an acquisition pricebasis)
1. Rental Apartments
Location

Acquisition price(millions of yen)
(Note 1)

Portfolio Share(%)(Note 2)

Okawabata Apartment Communities

Chuo-ku, Tokyo

29,696

13.3

Park Axis Gakugei Daigaku

Setagaya-ku, Tokyo

1,760

0.8

Park Axis Shibuya Jinnan

Shibuya-ku, Tokyo

3,230

1.4

Park Axis Aoyama Kotto-dori

Minato-ku, Tokyo

1,730

0.8

Park Axis Kagurazaka Stage

Shinjuku-ku, Tokyo

1,400

0.6

Park Axis Shirokanedai

Minato-ku, Tokyo

5,140

2.3

Park Axis Bunkyo Stage

Bunkyo-ku, Tokyo

4,440

2.0

Park Axis Tsukishima

Chuo-ku, Tokyo

930

0.4

Park Axis Otsuka

Toshima-ku, Tokyo

1,655

0.7

Park Axis Minami Azabu

Minato-ku, Tokyo

3,939

1.8

Park Axis Shibuya

Shibuya-ku, Tokyo

1,282

0.6

Park Axis Nihonbashi Stage

Chuo-ku, Tokyo

7,557

3.4

Park Axis Hamamatsucho

Minato-ku, Tokyo

2,025

0.9

Park Axis Hongo no Mori

Bunkyo-ku, Tokyo

2,910

1.3

Park Axis Tameike Sanno

Minato-ku, Tokyo

2,860

1.3

Park Axis Roppongi Hinokicho Koen

Minato-ku, Tokyo

2,170

1.0

Park Axis Ochanomizu Stage

Bunkyo-ku, Tokyo

9,710

4.3

Park Axis Okachimachi

Taito-ku, Tokyo

1,070

0.5

Park Cube Hongo

Bunkyo-ku, Tokyo

1,760

0.8

Park Cube Kanda

Chiyoda-ku, Tokyo

2,454

1.1

Park Cube Ichigaya

Shinjuku-ku, Tokyo

1,949

0.9

Park Cube Asakusa Tawaramachi

Taito-ku, Tokyo

2,508

1.1

Park Cube Ueno

Taito-ku, Tokyo

2,233

1.0

Park Cube Ikebukuro Kanamecho

Toshima-ku, Tokyo

1,608

0.7

Park Axis Meguro Honcho

Meguro-ku, Tokyo

1,810

0.8

Park Axis Shin Itabashi

Itabashi-ku, Tokyo

3,430

1.5

Park Axis Akihabara

Chiyoda-ku, Tokyo

1,200

0.5

Park Axis Toyocho

Koto-ku, Tokyo

3,950

1.8

Park Axis Takinogawa

Kita-ku, Tokyo

1,820

0.8

Park Axis Asakusabashi

Taito-ku, Tokyo

2,717

1.2

Park Axis Nihonbashi Hamacho

Chuo-ku, Tokyo

5,540

2.5

Park Cube Yoyogi Tomigaya

Shibuya-ku, Tokyo

1,975

0.9

Park Axis Monzen Nakacho

Koto-ku, Tokyo

1,700

0.8

Park Cube Itabashi Honcho

Itabashi-ku, Tokyo

4,170

1.9

Park Cube Gakugei Daigaku

Meguro-ku, Tokyo

910

0.4

1,440

0.6

Name

Park Cube Oimachi

Shinagawa-ku, Tokyo

Park Axis Nishigahara

Kita-ku, Tokyo

840

0.4

Park Axis Kinshicho

Sumida-ku, Tokyo

1,448

0.6

Park Axis Tatsumi Stage

Koto-ku, Tokyo

7,464

3.3

Park Axis Kameido

Koto-ku, Tokyo

2,359

1.1

8

Park Axis Honancho

Nakano-ku, Tokyo

Park Axis Itabashi
Park Axis Oshiage

745

0.3

Kita-ku, Tokyo

1,448

0.6

Sumida-ku, Tokyo

1,193

0.5

Park Axis Takadanobaba

Toshima-ku, Tokyo

1,222

0.5

Park Axis Toyosu

Koto-ku, Tokyo

14,300

6.4

Park Axis Hatchobori

Chuo-ku, Tokyo

1,760

0.8

Park Axis Itabashi Honcho

Itabashi-ku, Tokyo

987

0.4

Park Axis Sumiyoshi

Sumida-ku, Tokyo

1,006

0.4

Park Cube Yotsuya Sanchome

Shinjuku-ku, Tokyo

2,749

1.2

Park Cube Hatchobori

Chuo-ku, Tokyo

4,200

1.9

Park Axis Kamata Ichibankan

Ota-ku, Tokyo

1,069

0.5

Park Axis Taito Negishi

Taito-ku, Tokyo

672

0.3

Park Axis Komagome

Toshima-ku, Tokyo

1,389

0.6

Park Axis Itabashi Honcho Nibankan

Itabashi-ku, Tokyo

1,859

0.8

Shibaura Island Air Tower

Minato-ku, Tokyo

7,905

3.5

Park Cube Higashi Shinagawa

Shinagawa-ku, Tokyo

Tokyo 23 wards total

6,060

2.7

187,355

83.7

Park Cube Keio Hachioji

Hachioji-shi, Tokyo

991

0.4

Park Cube Keio Hachioji II

Hachioji-shi, Tokyo

1,130

0.5

Park Axis Nishi Funabashi

Funabashi-shi, Chiba

1,020

0.5

1,419

0.6

1,679

0.7

970

0.4

7,209

3.2

2,440

1.1

1,920

0.9

1,515

0.7

1,890

0.8

742

0.3

1,547

0.7

2,320

1.0

960

0.4

605

0.3

1,650

0.7

827

0.4

Park Axis Yokohama Idogaya
Park Axis Chiba Shinmachi
Park Axis Chiba

Minami-ku,
Yokohama-shi,
Kanagawa
Chuo-ku, Chiba-shi,
Chiba
Chuo-ku, Chiba-shi,
Chiba

Greater Tokyo Total (Note 3)
Nakamura-ku,
Park Axis Meieki Minami
Nagoya-shi, Aichi
Naka-ku, Nagoya-shi,
Park Axis Marunouchi
Aichi
Chuo-ku,Fukuoka-shi,
Park Axis Ropponmatsu
Fukuoka
Hakata-ku,Fukuoka-shi,
Park Axis Hakataeki Minami
Fukuoka
Hakata-ku,Fukuoka-shi,
Park Axis Naka Gofukumachi
Fukuoka
Higashi-ku, Nagoya-shi,
Park Axis Shirakabe
Aichi
Wakabayashi-ku,
Park Axis Sendai
Sendai-shi, Miyagi
Hakata-ku,Fukuoka-shi,
Park Axis Hakata Minoshima
FukuokaMinami-ku,Fukuoka-shi,
Park Axis Takamiya Higashi
Fukuoka
Chuo-ku, Sapporo-shi,
Park Axis Sapporo Shokubutsuen Mae
Hokkaido
Atsubetsu-ku,
Park Axis Shin Sapporo
Sapporo-shi, Hokkaido
Park Axis Esaka Hiroshibacho

Suita-shi, Osaka

2,369

1.1

Park Axis Utsubo Koen

Nishi-ku, Osaka-shi,
Osaka

2,399

1.1

Other Major Cities Total (Note 4)
Total

9

21,1849.5

215,748

96.4

2. Other Accommodation Assets
Name
Dormy Ashiya
Kawaijuku Kyoto Gakushin Ryo
Sundai Horikawa Ryo

Location

Acquisition price(millions of yen)
(Note 1)

Portfolio Share(%)(Note 2)）Ashiya-shi, Hyogo

928

0.4

991

0.4

916

0.4

374

0.2

Nakagyo-ku, Kyoto-shi,
Kyoto
Kamigyo-ku, Kyoto-shi,
Kyoto

Dormitory Rakuhoku

Kita-ku, Kyoto-shi, Kyoto

Rikkyo University International
Dormitory (RUID) Shiki

Shiki-shi, Saitama

1,478

0.7

Dormy Naka Itabashi

Itabashi-ku, Tokyo

1,041

0.5

Phirosophia Nishidai

Itabashi-ku, Tokyo

1,249

0.6

Dormy Musashi Kosugi

Nakahara-ku,
Kawasaki-shi,
Kanagawa

1,152

0.5

8,129

3.6

223,877

100.0

Total

Grand total(Note 1) “Acquisition Price” refers to the sale price (exclusive of miscellaneous expenses for acquisition, fixed property tax,
urban planning tax, consumption tax, and local consumption tax) of the property acquired. Amounts less than one
million yen have been rounded off.
(Note 2) “Portfolio Share” means the percentage of the acquisition price of the property acquired compared with the total
amount, rounded to the nearest one decimal place.
(Note 3) “Greater Tokyo” refers to four prefectures, Tokyo (excluding Tokyo’s 23 wards), Kanagawa, Saitama, and Chiba.
(Note 4) “Other Major Cities” refers to cities designated as regional government ordinance.

10