Make The World
More Sustainable[Provisional Translation Only]
This 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 shall prevail.

September 14, 2020
IssuerIchigo Hotel REIT Investment Corporation (“Ichigo Hotel,” 3463)
1-1-1 Uchisaiwaicho, Chiyoda-ku, Tokyo
Representative: Osamu Miyashita, Executive Director
www.ichigo-hotel.co.jp/english
Asset Management Company
Ichigo Investment Advisors Co., Ltd.
Representative: Hiroshi Iwai, President
Inquiries: Hidehito Iwasaka, Head of Ichigo Hotel
Tel: +81-3-3502-4892

Change in Hotel Operators
Ichigo Investment Advisors (“IIA”), the asset management company of Ichigo Hotel,
decided today to appoint new hotel operators for the Valie Hotel Tenjin and GrandparkInn Yokohama.
1. Change Overview
As part of the operator change, the Valie Hotel Tenjin is expected to be rebranded as
The OneFive Fukuoka Tenjin. The Grandpark-Inn Yokohama will be rebranded as well,with the new hotel name to be determined.
Valie Hotel Tenjin
New Operator

Former Operator

Operator

Hakata Hotels Inc.

The COURT Co., Ltd.

Lease Contract

Variable rent
Minimum guaranteed rent:
JPY 40,807,620 p.a.1
Variable rent: Quarterly GOP
less the quarterly minimum
guaranteed rent, a fixed
percentage of quarterly
revenue, and a fixed
percentage of quarterly GOP

Variable rent
Minimum guaranteed rent:
JPY 46,416,444 p.a.1
Variable rent: Monthly GOP
less the minimum guaranteed
rent and a fixed percentage ofmonthly GOP

None

NoneRent

Tenant Leasehold andSecurity Deposits

GOP: Gross operating profit
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The minimum guaranteed rent period is February 2021 to January 2022. The minimum
guaranteed rent for October 2020 to January 2021 is zero.
1Grandpark-Inn Yokohama
New Operator

Former Operator

Operatornine hours Inc.

Middlewood Co., Ltd.

Lease Contract

Variable rent
GOP-linked

Fixed rentMonthly GOP < JPY 8 million:
Monthly GOP – JPY 1 million

Rent

Monthly GOP > JPY 8 million:
JPY 7 million + 50% of
The operator has not consented(Monthly GOP – JPY 8
to disclosure.
million)Monthly GOP<JPY 1 million:
No rent payment (If GOP isnegative, the operator will bearthe loss and Ichigo Hotel willbear no expenses)

Tenant Leasehold andSecurity Deposits

The operator has not consented
to disclosure.

None

GOP: Gross operating profit
2. Reason for Change
Valie Hotel Tenjin
IIA is changing the hotel operator due to the upcoming expiration of the current lease
contract with The COURT. The new hotel operator will be Hakata Hotels, a
consolidated subsidiary of Ichigo, IIA’s parent company. Hakata Hotels currently
operates twelve hotels, including the HOTEL EMIT SHIBUYA and Comfort Hotel
Okayama, which will be rebranded as The OneFive Okayama in October 2020.
Hakata Hotels was chosen from among several candidate operators based on its
competitive price offering. Under the new contract, the Valie Hotel Tenjin’s fixed rent
will increase significantly, while the revision of a variable rent component will increase
the potential for upside earnings growth. Hakata Hotels will deploy PROPERA, an AIbased revenue management system developed by Ichigo, to maximize earnings andincrease guest satisfaction.
Grandpark-Inn Yokohama
IIA is changing the hotel operator due to the upcoming expiration of the current fixedterm lease contract with Middlewood. The new hotel operator will be nine hours, whichcurrently operates 16 capsule hotels under the brand 9h ninehours, as well as six otherhotels.
nine hours was chosen from among several candidate operators based on its competitive
price offering. Under the new contract, the introduction of a GOP-linked variable rent
will increase the potential for upside earnings growth.

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3. New Hotel Operator Profiles
Valie Hotel Tenjin
Name

Hakata Hotels Inc.

Address

3-13-1 Haruyoshi, Chuo-ku, Fukuoka

RepresentativeMinoru Ishihara, Representative Director & Chairman
Takanobu Kitazaki, Representative Director & President

CapitalJPY 10 million

Date of Incorporation March 11, 2019

1Principal Business

1. Development, operation, lease, and management of retailbuildings, hotels and restaurants
2. Lease and management of real estate
3. Design and construction of buildings and interior designs
4. Consulting services related to retail buildings, retail facilities,and restaurants

Relationship with
Ichigo Hotel or IIA

・The hotel operator is an operator of the HOTEL EMITSHIBUYA and Comfort Hotel Okayama, which are owned byIchigo Hotel.1
・The hotel operator is a related party as defined in theEnforcement Ordinance of the Investment Trust andInvestment Corporation Law, and is a related party as definedin IIA’s internal rules, given that the hotel operator is a
consolidated subsidiary of Ichigo, IIA’s 100% shareholder.

Comfort Hotel Okayama is expected to be rebranded as The OneFive Okayama inOctober 2020.

Grandpark-Inn YokohamaNamenine hours Inc.

Address

3-19-1 Kanda Nishikicho, Chiyoda-ku, Tokyo

Representative

Keisuke Yui, Representative Director & Founder
Takahiro Matsui, Representative Director & CEO

CapitalJPY 45 million

Date of Incorporation August 6, 2013
Principal Business

Planning, development, and operations of capsule hotels andrelated consulting services

Relationship withIchigo Hotel or IIA

The hotel operator does not have any capital, personnel, ortransactional relationship of note with Ichigo Hotel or IIA. In
addition, the hotel operator is not a related party of Ichigo Hotel.

34. Date of Operator Change
Valie Hotel Tenjin
Grandpark-Inn Yokohama

October 1, 2020 (expected)
February 1, 2021 (expected)

5. Related-Party Transaction (Valie Hotel Tenjin)
Hakata Hotels is a consolidated subsidiary of Ichigo, IIA’s parent company. Because
Hakata Hotels is a related party as defined in the Ordinance of the Investment Trust andInvestment Corporation Law and IIA’s internal rules, Ichigo Hotel obtained priorapproval for a lease contract as a related-party transaction from IIA’s Board ofDirectors.
6. Earnings Outlook
The impact of the operator changes on Ichigo Hotel’s January 2021 fiscal period
earnings has already been reflected in today’s announcement “July 2020 Fiscal PeriodEarnings Results Versus Forecast and Earnings Forecast Revision for the January 2021
Fiscal Period.” (N.B. Because the operator change for Grandpark-Inn Yokohama will
not occur until February 1, 2021, the change does not impact January 2021 fiscal periodearnings.)
The impact of the operator changes on Ichigo Hotel’s July 2021 fiscal period earnings
has already been reflected in the July 2021 forecast presented in today’s release “July2020 Fiscal Period Earnings.”

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