Presentation Materials
for the 8th Fiscal Period Ended
February 2022
Securities Code: 3488

Basic Principles and Characteristics of XYMAX REITXYMAX REIT accurately assesses the value of individual properties to maximize unitholder value. We fully utilize ourstrength in Management, Assessment, and Sourcing based on the knowledge and know-how of the XYMAX Group, which
has Japan’s No.1 track record in property management.
Terms

Definition

Estimated value atthe end of period

Indicates the acquisition value appraised by the appraisers or the research
price based on the Articles of Incorporation of XYMAX REIT and the“Ordinance on Accountings of Investment Corporations” (Ministry of
Finance Ordinance No. 47 of 2006, as amended) with the last day of thecurrent fiscal period as the research dateUnrealized gain

Estimated value of real estate, etc. at the end of period – book value atthe end of period

LTV based on total
assetsBalance of interest‐bearing liabilities / total assets

Appraisal LTV

Balance of interest‐bearing liabilities / (total assets + unrealized gain)

Net asset per unit

(Net asset ‐ total distribution) / total number of investment units issued
and outstanding

NAV per unit

(Net asset + unrealized gain ‐ total distribution) / total number ofinvestment units issued and outstanding

Acquisition price

The sales price of each trust beneficiary right indicated in the trust
beneficiary rights sales agreement, and does not include consumption
taxes, local consumption taxes and brokerage fees, etc.

Contents

Ⅰ.

Overview of Acquisitions through Asset
Replacement and Public Offering

Overview of Financial Results
Ⅱ.
and Earnings Forecasts
Ⅲ. Investment Status and Growth Strategy

Notes
 Unless otherwise specified, amounts are rounded to the nearest unit and ratios are rounded off tothe first decimal place.
 The following abbreviations of property names are used.

Ⅳ. ESG

Ⅴ. APPENDIXXYMAX Nishi-Shimbashi Building : Nishi-Shimbashi
XYMAX Iwamotocho Building
XYMAX Shinjuku-Gyoen Building : Shinjuku-Gyoen
XYMAX Kamiyacho Building
XYMAX Higashi-Azabu Building : Higashi-Azabu
XYMAX Higashi-Ueno Building
XYMAX Hachioji Building: Hachioji
XYMAX Mita Building
XYMAX Sapporo Odori Building : Sapporo
XYMAX Kiba koen Building
Muza Kawasaki: MuzaLife Kawasaki Miyuki Store
Vita Seiseki-Sakuragaoka: Seiseki-Sakuragaoka Life Fukuizumi StoreThe Park House Totsuka Front (the Retail Portions of 1st and 2nd Floors)
Valor Kachigawa Store (Leasehold land)
Hotel Vista Sendai: Sendai
Renaissance 21 Chihaya
L-Place Nishikasai: Nishikasai: Iwamotocho: Kamiyacho: Higashi-Ueno: Mita: Kiba: Kawasaki Miyuki: Fukuizumi: Totsuka: Kachigawa: Chihaya

2

Executive Summary
Through a series of asset replacements and capital increase by a public offering, XYMAX REIT realized external growth, andachieved revenue improvements for existing properties by the re-leasing of offices and tenant replacements at retail facilities.

 Steady management that leverages the XYMAX Group’s network, knowledge, and know-how
 Despite the impact of COVID-19, offices have recovered their occupancy rates quickly (as of the end of the 8th FP:
98.8%; as of March 1, 2022: 100%).
 Retail facilities recorded steady revenue, backed by the fixed-rent contracts. Tenant replacements are realizedwith no downtime at +15% rent of the previous tenants, which will occur in the 9th FP.
 Although the hotel’s operating performance was sluggish due to the COVID-19 pandemic, fixed-rent was revived
from the 8th FP onwards and the rents were received stably and continuously. Variable rent is expected torecover in the future.

 Expanded asset size through strategic asset replacements and the capital increase through thefirst public offering since listing.
 Improved portfolio stability while maintaining asset size and profitability by strategic asset replacements, andreturned gain on disposition to the unitholders.
 Acquired three properties using the capital increase through the first public offering since listing (total acquisition
price: 7.6 billion yen), expanding asset size to 43.4 billion yen.
 Improved distribution along with the effective additional leverage based on the appropriate LTV control.

 Stable financial base and ESG initiatives
 Expanded lender formation by inviting new banks, in cooperation with the XYMAX Group.
 Carried out initiatives leading to a reduction in the environmental burden, such as adoption of electricity from
100% renewable energy sources at existing office properties, and implementation of a public offering using
electronic issuance of prospectuses.
 Developed a internal organization for ESG promotion, to further enhance ESG initiatives.

3

Overview of Acquisitions through Asset
Replacement and Public OfferingOverview of Acquisitions through Asset Replacement and Public Offering

Change in Asset Size
Utilizing the XYMAX Group’s strengths in assessment and sourcing, XYMAX REIT has acquired properties with highmanagement stability and been expanding its asset size.

Acquired in February 2018

Shinjuku‐Gyoen

Acquired in September 2020

Iwamotocho

Fukuizumi

Acquired in July 2021

Mita

Totsuka

Asset replacements in January and March 2022

ChihayaTransfer of asset

Kachigawa (Leasehold land)
Acquisition of asset

Public offering (acquired assets)

SapporoKiba

Nishikasai

Continue to expand
asset size
Muza

Sendaibillion yen
434億yen+7.6
billion yen 43.4
+76億yen

Other 8 properties

33330億円
billion yen

2018年8月期
At
the end ofFP, ended
Feb. 2018+1
billion yen+10億yen34.1
billion yen
341億円

billion yen+1.2
billion yen 35.3
353億円
+12億yen

2021年2月期
At the end of

2021年8月期
At the end ofFP, ended Feb.
2021

FP, ended
Aug. 2021-2.7
billion yen-27億yen+3.2
billion yen+32億yen

As of Mar. 31, 2022

5

Overview of Acquisitions through Asset Replacement and Public Offering

Overview of Newly Acquired PropertiesXYMAX REIT believes that acquiring all properties with a 100% occupancy rate, that are expected to provide stable profits
over the medium- to long-term through exclusive transactions will expand its portfolio size and improve stability.
Number of properties:

Total acquisition price:

Aggregate appraisal value:410,856 million yen

11,386 million yen

Average appraisal NOI yield / average
Exclusive transaction ratio:
appraisal NOI yield after depreciation:

4.4% / 3.9%

┃Assets to be acquired in the 9th FP┃

Occupancy rate:

100.0%

100.0%┃Asset acquired in the 8th FP┃

Asset type

OfficeOfficeOther (Residential)

RetailProperty nameXYMAX Sapporo Odori Building

XYMAX Kiba koen Building

L-Place Nishikasai

Valor Kachigawa Store (Leasehold land)(quasi co-ownership interest: 50%)

Location

Sapporo-shi, Hokkaido

Koto-ku, Tokyo

Edogawa-ku, Tokyo

Kasugai-shi, Aichi

Access1 minute on foot from Odori station
Sapporo City Subway

1 minute on foot from Kiba station
Tokyo Metro Tozai Line

4 minutes on foot from Nishikasai station
Tokyo Metro Tozai Line

7 minutes on foot from Kachigawa
station JR Chuo Line

Acquisition price(million yen)

4,707

2,003

901

3,245

Appraisal value(million yen)

4,910

2,150

996

3,330

Appraisal NOI yield /appraisal NOI yield after
depreciation

4.2% / 3.2%

5.0% / 4.5%

5.6% / 5.1%

4.1% / 4.1%

Leasable area

3,106.42㎡

2,587.13㎡

2,044.18㎡

10,254.55㎡*1

Occupancy rate

100.0%

100.0%

100.0%

100.0%

Completion

2020

1992

1986

-

*1: The figure is calculated by multiplying the leased floor area under the lease contract by the quasi co-ownership ratio of the beneficiary rights held by the XYMAX REIT (50%).

6Overview of Acquisitions through Asset Replacement and Public Offering

Overview of Asset Replacements┃ Key points of asset replacements┃
 Carried out the first asset replacement since listing in cooperation with the XYMAX Group, uncovering unrealized gains.
 By returning part of the large unrealized gains since listing to unitholders, the expected distribution per unit for the periods that ended in
February 2022 and ending in August 2022 will increase dramatically.
 Continue to consider strategic asset replacement.

┃ Purpose of asset replacements┃1

2

3

Maintain asset size and distributableprofits for regular period

Uncover unrealized gains and return gains on
disposition for two periods

Enhance medium- to long-term revenue stability

Difference in NOI after depreciation: approx. +10
million yen/year

Difference between disposition prices and bookvalue: approx. +531 million yen

Acquisition of properties for which a long-term stable
contract has been concluded with the partner of a sponsor┃ Overview of asset replacement┃
Property acquisition
Valor Kachigawa Store (land with aleasehold interest) (Quasi-co-ownership: 50%)

Seller:Acquisition date:

Property disposition
Japan Metropolitan Fund
Investment Corporation

January 31, 2022

Location:

Onocho 2-chome, Kasugai-shi, Aichi

Land area:

20,509.10㎡

Renaissance 21 Chihaya

Purchaser:

Japan Metropolitan Fund
Investment Corporation

Disposition date:#1 (50%) January 31, 2022
#2 (50%) March 31, 2022

Location:

Chihaya 5-chome, Higashi-ku,
Fukuoka-shi, Fukuoka

Completion:

October 19, 2006

Acquisition price:

3,245 million yen

Book value (as of August 31, 2021):

2,748 million yen

Appraisal value (as ofJanuary 1, 2022):

3,330 million yen

Appraisal value (as of August 31,2021):

3,280 million yen

Disposition price:

3,280 million yen

Appraisal NOI yield after
depreciation:

4.1%

Actual NOI yield after
depreciation:

3.7%

7

Overview of Acquisitions through Asset Replacement and Public Offering

Portfolio Data (1)
Asset

Debt

As of March 31, 2022

Number of properties

18

Balance of interest-bearing
liabilities

19.9 billion yen

Asset size (based on
acquisition price)

43.4 billion yen

LTV based on total assets*5

41.0%

Appraisal value*1

54.7 billion yen

Appraisal LTV*6

33.6%

Average borrowing rate*7

0.632%

Average remaining period

2 years 10 month

Fixed interest rate ratio

96.5%

Unrealized gains*2(unrealized gain ratio)

10.7 billion yen (+24.5%)

Profitability(based on acquisition price)appraisal NOI yield: 5.5%*3
appraisal NOI yield after
depreciation: 4.8%*4

EquityAverage building age(weighted average ofacquisition price)

18.7 years

Total leasable area

85,317.97㎡

Occupancy rate

99.9%

Asset type(based on acquisition price)

Office:Retail:Hotel:
Others:

58.3%
29.5%
10.1%
2.1%

Aggregate market value

31.2 billion yen

Unitholders’ capital

25.4 billion yen(Total number of investment units
issued and outstanding: 249,650)

Investment unit price

125,000 yen

NAV per unit*8

145,046 yen

Distribution per unit

3,867 yen (9th FP forecast)

*1:
*2:
*3:
*4:
*5:

As of January 1, 2022 for properties acquired through a public offering, and as of the end of the 8th FP for existing properties
Appraisal value – acquisition price for properties acquired through a public offering, and appraisal value – book value as of the end of the 8th FP for existing properties
Appraisal NOI for properties acquired through a public offering, and annualized actual NOI for the 8th FP for existing properties
Appraisal NOI – depreciation calculated by the Asset Management Company for properties acquired through a public offering (this figure is calculated by the Asset Management Company, and is not the figure recorded on the real estate appraisal report)
LTV based on total assets = (Total borrowings as of March 31, 2022) ÷ (total assets as of February 28, 2022 (the end of the 8th FP) + change in borrowings during a period from February 28, 2022 (the end of the 8th FP) to March 31, 2022 –security deposits of Chihaya
as of February 28, 2022 (the end of the 8th FP) + security deposits from properties acquired through public offering + net proceeds from public offering) × 100*6: Appraisal LTV = (Total borrowings as of March 31, 2022) ÷ (total assets as of February 28, 2022 (the end of the 8th FP) + change in borrowings during a period from February 28, 2022 (the end of the 8th FP) to March 31, 2022 – security deposits of Chihaya as ofFebruary 28, 2022 (the end of the 8th FP) + security deposits from properties acquired through public offering + net proceeds from public offering + unrealized gain on properties acquired through public offering and existing properties) × 100*7: Interest rate for floating rate borrowings is calculated based on the JBA 1-month Japanese Yen TIBOR as of March 31, 2022.
*8: (Net asset at the end of the 8th FP + unrealized gain at the end of the 8th FP – total distribution for the 8th FP – unrealized gain on Chihaya at the end of the 8th FP + unrealized gain on properties acquired through public offering + net proceeds from public offering)÷ total number of investment units issued and outstanding8

Overview of Acquisitions through Asset Replacement and Public Offering

Portfolio Data (2)As of March 31, 2022

■5 wards of Tokyo**■23 wards of Tokyo excl. 5 wards■Tokyo economic area***■Designated cities■Tokyo metropolitan area

■Office

2.1%
10.1%

Percentage by year engaged by XYMAX Group

Percentage by geographic area

Percentage by asset type■Retail■Hotel■Others■Main asset

29.5%

7.5%

34.2%

23.4%

5.8%

the acquisition priceon the acquisition price

30.2%
Average*The breakdown is based on*The breakdown is based
58.3%

23.6%

11.1
years

■Less than 5 yrs.
■5〜10 yrs.
■10〜15 yrs.
■15〜20 yrs.
■Over 20 yrs.
■Over 5 yrs.
*The breakdown is based on the**Chiyoda, Chuo, Minato, Shinjuku and

9.3%

25.6%

97.9%

acquisition price and average

Shibuya wards within Tokyo.

69.1%

23.1%

***Tokyo (excl. 23 wards of Tokyo),

17.3%

shows the simple average

69.8%

and prefectures of Kanagawa,
Saitama, and Chiba.

35.7%

Minutes from nearest station■10,000 yen - 15,000 yen■15,000 yen - 20,000 yen■20,000 yen *Excl. rents of stores, parking lots,
etc.
45.6%
**Unit rent incl. CAM■Less than 3 minutes■3〜5 minutes

19.0%

24.4%

*The breakdown is based on
the acquisition price andaverage shows the simple
average

Average

2.7
min.

Composition of retail properties■Station-front■Other■Neighborhood *1*The breakdown is based on
the acquisition price

39.7%

14.4

9.9%

60.3%

100%

Average

8.1

years

37.8%

years

■Less than 10 years■10 years or more andless than 15 years■15 years or more andless than 20 years■20 years or more
*The breakdown is based on theacquisition price and averageshows the simple average

36.6%

Percentage of specialized in Stay

Average engagement period

38.1%

29.1%
Average

81.0%

18.6%

RetailAverage engaged period■less than 5 years■5 years or more andless than 10 years■10 years or more
*The breakdown is basedon the acquisition price andaverage shows the simple
average

24.1%*1 Retail facilities for which the majority of customer can easily come on foot or by bicycle in a short time.

■Specialized in Stay
*The breakdown is basedon the acquisition

Hotel

OfficeAverage unit rent 16,365yen/tsubo

100.0%

9

Overview of Financial Resultsand Earnings Forecasts

Overview of Financial Results and Earnings Forecasts

Overview of Financial Results
Operating revenue was 1,611 million yen, up 23.5% and net income was 870 million yen, up 34.3% from the previous
Unit: million yen
period, respectively.
Actual results
for the 8th FP (B)the 7th FP (A)Difference(B)‐(A)

Main factors for difference (B)‐(A)

1,193

1,289

96

Revival of fixed rent (Sendai) +65,
rent revenue (Mita, Totsuka*1 +26 / Kachigawa +11 / Chihaya -8)

112

102

–9

Lump sum income -18, electricity reimbursements(existing properties*2) +3

-

219

219

Gain on disposition(Chihaya) +219

1,305

1,611

306

Expenses related to leasing business(Excluding Depreciation)

344

348

4

NOI

960

1,043

82

137

142

5

Leasing business income

823

901

77

Other operating expenses

122

173

51

Operating income

701

946

245

Non‐operating income

0

0

–0

Non‐operating expenses

52

75

23

Ordinary income

648

871

222

Net income

647

870

222

2,900

3,896

996

Leasing business revenue
Other leasing business revenue
Gain on sale of real estate properties
Operating revenue

Depreciation

Distribution per unit (yen)Property operating expenses (Mita, Totsuka*1+8),
electricity charges(existing properties*2) +5, repair expenses (existing
properties*2) -3

Disposition fees +32

Interest and borrowing related expenses (refinance and new borrowings)+23

Comparison with the distribution forecast released in January 2022
(3,877 yen) +19 yen

Days: 7th FP: 184 days, 8th FP: 181 days
Number of investment units issued and outstanding: 7th FP: 223,400, 8th FP: 223,400*1: Since Mita and Totsuka were acquired on July 1, 2021, their period of contribution was two months in the 7th FP and six months from the 8th FP.
*2: The existing properties are assets owned at the end of the 8th FP excluding Mita, Totsuka, Kachigawa and Chihaya.

11

Overview of Financial Results and Earnings Forecasts

Earnings Forecast for the 9th FP ending August 2022
Unit: million yen
Actual results
for the 9th FP (B)the 8th FP (A)Difference(B)‐(A)

Main factors for difference (B)‐(A)

1,289

1,493

204

Other leasing business revenue

102

109

7

Gain on sale of real estate properties

219

222

2

1,611

1,825

213

348

388

40

1,043

1,214

171

142

157

14

Leasing business income

901

1,057

156

Other operating expenses

173

193

19

Operating income

946

1,086

139

Non‐operating income

0

0

–0

Non‐operating expenses

75

119

44

Ordinary income

871

966

95

Net income

870

965

95

3,896

3,867

–29

Leasing business revenue

Operating revenue

Expenses related to leasing business(Excluding Depreciation)

NOI
Depreciation

Distribution per unit (yen)Days: 8th FP: 181 days, 9th FP: 184 days
Number of investment units issued and outstanding: 8th FP: 223,400, 9th FP: 249,650*1: The existing properties are assets owned at the end of the 8th FP excluding Kachigawa and Chihaya.

Rent revenue (four new properties +268 / Chihaya -86 / existing
properties*1 +21)

Property operating expenses (four new properties +45 / Chihaya -27),
Repair expenses (existing properties*1) +13, electricity expenses (existing
properties*1) +5Interest and borrowing related expenses (refinance and new borrowings)+38,
amortization of investment unit issuance expenses +5

Comparison with the distribution forecast released in February 2022
(3,845 yen) +22 yen

12Overview of Financial Results and Earnings Forecasts

Earnings Forecast for the 10th FP ending February 2023
Unit: million yen
the 9th FP
forecast (A)the 10th FP
forecast (B)Difference(B)‐(A)

Main factors for difference (B)‐(A)

1,493

1,484

–9

Rent revenue (disposed property (Chihaya) -8)

Other leasing business revenue

109

113

3

Electricity reimbursements +2

Gain on sale of real estate properties

222

-

–222

1,825

1,597

–227

388

393

4

1,214

1,204

–10

157

164

7

Leasing business income

1,057

1,039

–18

Other operating expenses

193

158

–34

1,086

880

–205

0

0

0

Non‐operating expenses

119

108

–11

Ordinary income

966

772

–193

Net income

965

771

–193

3,867

3,091

–776

Leasing business revenue

Operating revenue

Expenses related to leasing business(Excluding Depreciation)
NOI
Depreciation

Operating income
Non‐operating income

Distribution per unit (yen)Gain on disposition (Chihaya) -222

Leasing cost +2, electricity expenses +1

Disposition fees -33

Interest and borrowing related expenses (refinance and repayment) -11

Comparison with the distribution forecast released in February 2022
(3,080 yen) +11 yen

Days: 9th FP: 184 days, 10th FP: 181 days
Number of investment units issued and outstanding: 9th FP: 249,650, 10th FP: 249,650

13Investment Status and Growth Strategy

Investment Status and Growth Strategy

Status of Office Tenant –Occupancy Rate & Tenant Replacements –Despite the continued downtrend in the office tenant market, sponsor group’s operational capability helped the earlyrecovery of occupancy rate, which achieved 100% for the contract occupancy rate as of March 1, 2022.
┃Status of occupancy rate & tenant replacements┃• Eight office properties (exc. obligated residences. Forecast for the 9th FP includes Sapporo and Kiba.)
100.0%
98.8%
98.9%
96.4%
94.3%
99.5%
98.9%
98.8%
(tsubo)
500
400
300
200
100
0
-100
-200
-300
-400
-500

Vacancy area at the endof FP*３ (tsubo)

93.7%

92.6%
4.2%

2.1%
128.83-98.98
-1.6%

1.6%

-2.7%

99.2%
99.2%

8 8% Economic occupancy

5.4%

rate for the 10th FP(forecast)

271.880.4%

348.53

1.2%

25.94

-2.8%

0 0%

0.0%

-177.30-1.1%-427.57

Average

76.23-69.12-4 -4%

97.5%

Contract occupancy rate
at the end of FP
Economic occupancy
rate at the end of FP
Occupancy rate*1-6.6%-8 -8%

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP (forecast)

0.00

71.63

222.99372.73

76.23

69.12

┃Average of free rent period*4 ┃

100%

(%)

4 4%

97.59
-169.22

Contract Occupancy
Rate as of March
1,2022

Surrender rate*2■Area contract start■Area contract end• Eight office properties (exc. obligated residences. Forecast for the 9th FP includes Sapporo and Kiba.)(month)

5
4
3
2
1

2.2

2.0

2.0

4th FP

5th FP

6th FP

2.8

3.6

4.0

8th FP

9th FP0

7th FP(forecast)*1 Occupancy rate: area contract start ÷ Total leasable area
*2: Surrender rate: area contract end ÷ Total leasable area
*3 Area for which the lease contract term has not started as of the end of each FP*4 Average of free rent period: free rent period granted in contracts whose contract period start in each FP (new leases) x total contract area of contracts with free rent granted in new leases ÷ total area where newcontracts start15

Investment Status and Growth Strategy

Status of Office Tenant – Tennant Replacement & Contract Renewal –┃Status of tenant replacement and contract renewal┃• Eight office properties (exc. obligated residences. Forecast for the 9th FP includes Sapporo and Kiba.)
39.4

40

15.7
(tsubo)
2,000

4.2

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

10.6

0.4

-0.9

0

-1.5

0.6

-1.1

-15.3

-16.7

467.14

46.08
91.48

23.04

344.48250.41

97.59

98.98

% change of rent uponrenewal*1% change of rent upon
replacement*2(%)

468.62231.58

0
(100)

0
-20

76.23

1,107.07
170.81

-500
(600)

20

■ Replacements with higher rent
■ Renewals with higher rent
■ Replacements with lower rent
■ Renewals with lower rent

228.69 76.23

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP (forecast)

For renewal (tsubo)

1,269.34

1,767.28

1,394.35

1,903.66

1,307.30

906.05For new lease(tsubo)128.83

97.59

25.94

271.88348.5376.23

Highlights for the 8th FP

Forecast for the 9th FP✔6 new leases(2 space with higher rent and 3
spaces with lower rent)✔19 renewals(2 spaces with higher rent and 0
spaces with lower rent)✔1 new leases(1 spaces with lower rent)⇒Achieved 100% of occupancy
rate on March 1, 2022
✔3 surrenders 69.12 tsubo (Mita)✔15 renewals(1 spaces with higher rent and 3
spaces with lower rent)⇒Total percentage of change:-3.8%
Monthly rent decreased by 855
thousand yen(Incl. reduction in the unit rent of
a newly contracted space due to achange of use from retail tooffice)⇒Total percentage of change:-2.3%
Monthly rent decreased by 331
thousand yen┃ Floor area scheduled for contract renewal ┃• Ten office properties (excl. obligated residences. Incl. Sapporo and Kiba.)
1 Rent gap: over 10％
3 Rent gap: over -10％ less than 0％

2 Rent gap: over 0％ less than 10％
4 Rent gap: -10％ or less(tsubo)2,500

1,724.88
1,283.93

2,000
1,500
1,000

654.32(19 spaces)(11 spaces)

2,716.26(23 spaces)

Rent gap at the end of 8th FP
Assumed new unit rent*4:
16,068 yen/tsubo
Unit rent for existing contracts *4:
16,365 yen/tsubo⇒Rent gap vs. assumed new rent
10 office properties: 1.8%

(27spaces)

5000

9th FP

10th FP

11th FP

12th FP*1: % change of rent upon renewal: (rent that includes CAM revenue after renewal – rent that includes CAM revenue before renewal) ÷ rent that includes CAM revenue before renewal*2: % change of rent upon replacement: (rent that includes CAM revenue after tenant replacement – rent that includes CAM revenue before tenant replacement) ÷ rent that includes CAM revenue before tenant replacement*3: Rent gap (contractual unit rent – assumed new unit rent) ÷ assumed new unit rent
*4: The various unit rents: using a monthly unit rent that includes CAM revenue.

16

Investment Status and Growth Strategy

Trends in Workplaces and Advantages of XYMAX REIT
┃Current workplace trends┃


COVID-19 has accelerated the diversification of the workplace  Future in-office work plans vary by company size and industry

Companies that are diversifying their workplaces are requiring different function to be furnished for each type of workplace.
Workplace

Main offices

Non-main officesFeature of workplace

Function of a workplace

A base as a “place of gathering” for employees A base for resolving the issues of remote working (difficulties incommunication and organizational management)• A convenient location for employees to gather (city center)• Safe building (seismic resilience and security)• A hygienically clean and well-maintained building

A base as a space to work during idle time as well as a place to work near home
 A base contributing to the effective use of time and the employees’ wellbeing• A location close to destinations to visit and employees’ homes• High security performance• Internet environment (safe Wi-Fi environment)

In conjunction with the changes in “how real estate is used,” office tenants are moving into properties in previously untapped locations and new types ofassets.
Example: satellite office tenants are moving into retail facilities in front of stations in Tokyo metropolitan suburbs
Corporate workplace strategies are changing, and it is necessary to continually gather information on “how real estate is used.”┃Advantages of XYMAX REIT┃ Knowledge andknow-how of
XYMAX GroupCapturing trends on “how real estate is used” for uses and locations through the real estate management business
Capturing trends in corporate office strategies through the ZXY businessResearch and studies on real estate by XYMAX REAL ESTATE INSTITUTE Corporation

 Central office

Locations near stations in city centers and a reasonable unit rent suitable for main offices and meeting places
Confirmation of buildings’ capacity by using the “strength of assessment”
Maintenance and management of buildings by using the “strength of management”

Competitive edge when finding new tenants by using the strengths of “assessment” and “management” (Hachioji)
Capturing needs of workplaces close to homes

 Suburban offices
 Suburban retailproperties→ A satellite base operated by a certain company moved into Hachioji and ZXY, the satellite office service, moved into Totsuka

17

Investment Status and Growth Strategy

Current Status of Hotel Vista Sendai (1)Demand for accommodations is emerging from the slump period, and the stability in rent revenue is also recovering due to the revival of fixed rent.
From September 2022 (the 10th FP) onwards, profitability is expected to improve, as 500 thousand yen will be added to the fixed rent every month.

┃ Lease conditions ┃Rent type

Fixed rent

Variable rent

Lease conditions up to October 2020－

240 million yen/year(Annual GOP – 252 million yen) × α%

Nov. 2020 - Feb. 2021

Ⅰ-1

None

GOP for the current month × β%*Mar. 2021 - Aug. 2021

Ⅰ-2

None

GOP for the current month × γ%*

Sep. 2021 - Aug. 2022

Ⅱ

20 million yen/month

After Sep. 2022

Ⅲ

20.5 million yen/month

Revival of
fixed rent

Recovering the
portion of
reductions or
waivers over thelong term(GOP for the current month – 21 million yen)× α%**(GOP for the past 1 year /12 – 21.5 million yen) × α%***0 yen, if the GOP for the month is negative**0 yen, If the results of the calculation are negative<Illustrative rent calculation image>
6th FP

7th FP

2020
Sep.

8th FP

9th FP

2021
Oct.

Conditions
prior to revisions

Nov.

Dec.

Jan.

Rent typeI-1

10th FP

2022
Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Sep.

Nov.

Dec.

Jan.

Feb.

Rent type III

Rent type II

Rent typeI-2

To mitigate seasonal changes, GOP, the basis forcalculating variable rent, was used as the moving
average of past 12 months.

2023

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

18

Investment Status and Growth Strategy

Current Status of Hotel Vista Sendai (2)The hotel business performance recovery in the 2H in 2021 and temporarily slowed due to semi-state of emergency
measures from January 2022, but the recovery is expected going forward.
Occupancy rate (Right axis)

(yen)

9,000

State ofemergency
declaration

8,488
7,382
7,213

ADR (Left axis)

7,455 7,351

GoTo Travel
Campaign

7,090(after Tokyo addedfor departures
and arrivals)

7,044

5,751

85.0%

3,388

2,414

72.5%

1,481

0

9.2%

583

58.1%

6,044 5,970

4,130

3,608

3,322

66.0%

State ofemergency
declaration

State ofemergency
declaration

6,393 6,253

52.3%

65.3%

38.7%

6,633
6,051

7,139

5,943

7,618

5,399

59.3%

49.8%

57.1%

74.4%

200%

7,712
7,171

7,031
150%

6,256
4,896

4,595

100%
100

3,669

3,570
3,538
3,185
82.9%

68.3%

71.8%

6,438

4,666
4,504

2,083

75.8%

6,892

5,711

4,203

4,199

44.6% 678

6,473

6,441
5,339 5,384

5,352

Semi-state of
emergency
measures

Semi-state of emergency measures

State ofemergency
declaration

7,494

6,359
6,004 6,233 6,207

6,000

3,000

PevPAR (Left axis)

GoTo Travel
Campaign

81.4% 83.2%

82.1%

72.5%

69.6%

64.1%

50%
50

47.6%

36.2%

24.7%

00%

8.2%

2020
2021
2022
Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar.

[Current operating KPIs]
5th FP

6th FP

7th FP

8th FP

ADR

6,587 yen

6,693 yen

6,364 yen

7,012 yenOccupancy rate

30.7%

61.3%

65.1%

72.5%

RevPAR

2,024 yen

4,104 yen

4,140 yen

5,368 yen

[Actual variable rents prior to the COVID-19 and KPIs for variable rent calculation period]
3rd FP
4th FP
Actual variable rents

43,967 thousand yen

41,289 thousand yen

ADR8,955 yen

8,828 yenOccupancy rate

87.9%

89.0%

RevPAR

7,875 yen

7,859 yen

19

Investment Status and the Growth Strategy

Portfolio Status: Retail Properties
The impact of COVID-19 has been minimal, and we have been enjoying stable rent revenue based on fixed-rent contracts.
 All retail properties owned by XYMAX REIT are located in the suburbs of large metropolitan areas, where robust business conditions
are expected for tenants.
 Most of the tenants to the master lease properties are daily use type of business with steady sales.
 Multi-tenant retail properties achieved internal growth by utilizing expertise and know-how of the XYMAX Group.
 Even amid the COVID-19 pandemic, there was no bankrupt tenant and delayed rent payments.

 In conjunction with changes in how retail facilities are used, we intend to maintain and improve asset value in leasing by considering
a wide array of industries beyond the existing industries.

┃ Properties of XYMAX REIT ┃Fukuizumi

Breakdown of properties
by type(Based on rent revenue)

Status of multi‐tenant retail properties
 Internal growth driven by replacement and rent
revision (forecast):
Monthly rent: +2.85 million yen(*Total leased floor area: 1,381.03 tsubo)
Totsuka(ten thousand yen)
■Increase in monthly rent
300
■Decrease in monthly rent

+231

250
Multi-tenant
properties
Master leaseproperties

Muza

66%

+64

+285

Leased area (tsubo)

600

-23

200

34%

Kawasaki
Miyuki

 Termination date of lease term (based oncontract area)
Average remaining lease period: 6.8 years*

400

Terminate in 9 FP (2 spaces):
Contracts concluded with no412.60
downtime and with higher
rent (+15% compared with therent for the previous tenant)

150
100

200
113.0150+120Seiseki‐Sakuragaoka

Kachigawa

15.43

7.80

2022年8月期

2023年2月期

0
2nd FP
4th FP
6th FP
9th FP
Total through2019年2月期
2020年2月期
2021年2月期
2022年1月期

9th FP

10th FP

2023年8月期

11th FP

2024年2月期

12th FP

0.00

0.00

2024年8月期

2025年2月期

13th FP

14th FP

9th FP

20

Investment Status and the Growth Strategy

External Growth – Continue to implement measures for external growth–
XYMAX REIT will continue to focus on asset type and consider acquisition of properties in accordance with the portfolio strategy.
We will continue our sourcing activities to determine the fundamental value of the target properties, with an awareness of the balance
between DPU growth and financial soundness.

┃ Unrealized gain by property owned by XYMAX REIT┃┃ Acquisition policy ┃As of March 31, 2022

 We intend to build new property pipelines by selecting prime properties
from the rich property information gained from the sponsor network andcarefully examining them at the Asset Management Company.
6th FP

7th FP

8th FP

Number of pieces of informationacquired from sponsor group

899

807

767

Number of properties underconsideration by XYMAX REIT

18

20

28

┃LTV┃As of March 31, 2022

 As for the return of unrealized gain on properties, which is one of
the XYMAX REIT characteristics, XYMAX REIT will consider the
return by asset replacements, etc. as one of the asset strategies.
Others95
Sendai1,045
Other(4,185 yen)retail311
Seiseki‐
Other
Sakuragaoka
Hotel452(1,810 yen)
Muza
1,414
(5,663 yen)

LTV based on total assets: 41.0%, Appraisal LTV 33.6%
LTV levelvs. total assets

Possible loan amount45%

Approx.
3.5 billion yen

37.3%

50%

Approx.
8.7 billion yen

42.1%

Appraisal LTV

RetailShinjuku‐Gyoen
2,541(10,178 yen)Total
unrealized gain

10,770
million yen

OfficeOther office
786 Higashi-Azabu

392
Hachioji(1,570 yen) Nishi-Shimbashi 914
Higashi-Ueno 773(3,661 yen)
(3,096 yen)489
(1,958 yen)

┃ Properties under consideration ┃Total property pipeline size of two properties: Over 5.0 billion yen
LocationCore regional city

Core regional city

Iwamotocho
1,551(6,212 yen)(unit: million yen)
*The amounts in parentheses are
Unrealized gains per unit for each
property.

Asset type

SourceRetail properties

CRE client of the XYMAXGroup

A retail development project in a location that is highly desired by CRE clients for
opening stores
Tenants are expected to include daily necessities selling tenants with strong sales

Private fund managed by
the XYMAX Group

Located in a regional economic hub and also with a high level of tourism resources,
there is solid demand for accommodation(planned)

Hotel(specialized in stay)

Focused point

21

Investment Status and the Growth Strategy

Key Point for the Future
We will pursue further improvement in unitholder value through realizing external growth, in addition to the continued
internal growth since listing.

43.4
37.2
billion33.0 33.0 33.0 33.0 33.0 34.1 35.3 billion yen

billion billion billion billion billion billion billion
yen
yen
yen
yen
yen
yen
yen

Aiming to growfaster than everbeforeyen

Key Point for the Future Achieved stable internal growth in office and retail properties by fully utilizing management capability of the
XYMAX Group and grasping a window of opportunity in the favorable leasing market (1st to 5th FPs).
 From 6th FP onward, realized an early recovery in occupancy rate and profitability despite a temporary
weakness in office occupancy rate due to the impact of the COVID-19 pandemic.
 Hotels back on a stable profitability trajectory from the 8th FP despite a significant impact of the COVID-19
pandemic.

 Pursue stable management of office and retailproperties while maintaining high occupancy rate.
 Variable rents can be expected due to recovery inhotel sales.

 Implemented external growth usingborrowings that utilized low LTV as thesource of the fund (6th and 7th FPs).
 Conducted return of unrealized gain by asset
replacements (8th FP).
 Expand asset size through a public offering(9th FP).

 Continue consideration of return of unrealized gain
by strategic asset replacements.

OthersExternal
growthInternal
growth

1st FP to 9th FP

Furthergrowth Obtain ratings and GRESB certification to expand theunitholder base and diversify the financing source.

22

Investment Status and the Growth Strategy

Financial Status as of March 31, 2022
XYMAX REIT establishes a financial base that puts emphasis on stability and soundness and provides flexibility infinancing, mainly composed of megabanks and regional banks, etc., that have financial business relationships with thesponsor group.
┃ Lender formation ┃Number offinancial
institutions

16 companies
19.94
billion yen┃Trends of Borrowing status┃
Mizuho Bank

24.8%

SMBC

18.3%

MUFG Bank

12.3%

Resona Bank

7.5%

Aozora Bank

6.5%

Nishi-Nippon CB

5.0%

Fukuoka Bank

5.0%

Yokohama Bank New

4.0%

Hiroshima Bank

3.5%

Nanto Bank

New

2.9%

Higo Bank

2.5%

Chiba Bank

1.5%
1.5%

Kansai Mirai BankNew

As of March 31,
2022

Gap

Number of financial
institutions

13

16

+3

Balance ofinterest‐bearing debts

14.05 billion yen

19. 94 billion yen+5. 89 billion yen

Average remaining
period1 year 9 months

2 years 10 months+1 year 1month

Average interest rate

0.581%

0.632%+0.051%

Fixed interest rate
ratio

81.0%

96.5%

+15.5%

Long‐term loan ratio

87.4%

98.3%

+10.9%

Borrowed on

Borrowed on
2022年3月2日付借入
March
2, 2022

3.0%

Shinsei Bank

Fukoku-life

At the end of
7th PF

1.1%

Mizuho Trust & Banking 0.5%

┃ Maturity ladder┃

第7期末時点返済金額
At 7th FP

2022年1月31日付借入
January 31, 2022

4,376

4,302

(million yen)

5,000
4,000

4,856
3,270

3,141

3,000
2,000
1,000
0
9th
FP
第9期

10th
FP
第10期

11th
FP
第11期

12th
FP
第12期

13th
FP
第13期

14th
FP
第14期

15th
FP
第15期

16th
FP
第16期

17th
FP
第17期

18th
FP
第18期

2022/8月期

2023/2月期

2023/8月期

2024/2月期

2024/8月期

2025/2月期

2025/8月期

2026/2月期

2026/8月期

2027/2月期

23

ESG

ESG

ESG Initiatives (1)Strengthen ESG Initiatives
In order to systematically work on ESG as an organization, we formulated the ESG policy and relevant policies, established an ESG
promotion structure and conducted employee training at XYMAX REIT and the Asset Management Company.
We will continue our ESG initiatives to obtain GRESB certification.

Acquisition of Environmental Certification
Acquired environmental certification for the following properties. XYMAX REIT will continue to promote environmental andenergy‐saving measures of owned properties and improve efficiency of energy use.
┃ BELS ┃┃ CASBEE－Real estate ┃XYMAX Nishi‐
Shimbashi Building

Assessment Rank

Rank A(Very good)

XYMAX
Higashi‐Azabu
Building

XYMAX
Iwamotocho Building

XYMAX Higashi‐
Ueno Building

XYMAX
Shinjuku‐Gyoen
Building

XYMAX
Hachioji Building

Hotel Vista
SendaiXYMAX
Higashi‐Azabu
Building

Assessment
Rank

Assessment
Rank

★★★

★★

┃ Acquisition status ┃ As of March 31, 2022
* Higashi‐Azabu has obtained CASBEE and BELS certification.

Number of Acquisition ofEnvironmental Certification

7 properties

Acquisition rate(based on total floor area)

40.6%

25

ESG

ESG Initiatives (2)Initiatives for Reducing Environmental Burden┃ Adoption of electricity from 100% renewable energy sources┃

Switching to 100% renewable energy sources using non-fossil certificates with tracking completed at eight office properties
A feed-in tariff (FIT) system for electricity, etc.
Renewable energy non-fossil
certificate with tracking

Biomass

Wind power

Solar power

Hydroelectric power

Electricity supplier

Targeted electricity consumption: 1.72 million kwh / approx. 814 tons (in tons of CO2) (based on the 7th FP)┃Improvement of environmental performance through building/facility renovation┃
Implementing renovation work for air
conditioning systematically
Implemented properties:
Iwamotocho,
Shinjuku‐Gyoen,
Higashi‐Azabu,
Higashi‐UenoImplementing LED replacement
systematically in common area andexclusive spaces
Implemented properties:
Nishi‐Shimbashi,
Iwamotocho,
Shinjuku‐Gyoen,
Kamiyacho, Higashi‐Azabu,
Higashi‐UenoInstalling hydropower sensor faucets tosave water and energy usage
Installed properties:
Nishi‐Shimbashi,
Shinjuku‐Gyoen,
Higashi‐Azabu,
Higashi‐Ueno

26

ESG

ESG Initiatives (3)Initiatives for a Sustainable Society
Signing of Principles for Financial Action for the 21stCentury by Ministry of the Environment XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation, AssetManagement Company of XYMAX REIT, has endorsed the ideas of
the Principles and became a signatory on December 27, 2013.

Initiatives for Tenants and Local Communities┃Introduction of emergency storage boxes in elevators┃┃Introduction of Disaster‐Relief Vending Machines┃ Emergency storage boxes have been
installed in elevators in six properties
as confinement measures at
earthquake disaster.

 Introduced disaster‐relief
vending machines to provide
drinks for free (by remotecontrol) during emergencies.

Installed properties: Iwamotocho,
Shinjuku‐Gyoen, Kamiyacho, Higashi‐Azabu,
Higashi‐Ueno, HachiojiInstalled properties: Higashi‐Azabu,
Higashi‐Ueno, Totsuka┃ Operation to prevent the spread of COVID-19 ┃ Replacing conventional toilet faucets with automaticfaucets
 Thoroughly implementing COVID-19 countermeasuresamong the management and cleaning staff (wearing
face masks, washing hands, disinfecting, gargling, etc.)
 Introducing alcohol-based disinfectants and foot pedal
stands in common areas┃ Initiatives to engage tenants through digital signage┃

 Digital signage that displays
disaster evacuation maps and ESG
contents is installed at property’scommon area.
Installed properties: Iwamotocho,
Shinjuku‐Gyoen, Kamiyacho, Higashi‐Azabu,
Higashi‐Ueno, Hachioji

27

ESG

ESG Initiatives (4)Initiatives of Asset Management Company┃Qualification support system ┃┃Respect for diversity┃

 Asset Management Company introduced a system to provide incentives for
employees who acquire certain qualifications.
 Status of qualification (incl. those unregistered) by employees of Asset Management
Company (as of April 1, 2022)

 More than half of our executives and employees are female, and female
employees are succeeding in a wide range of fields, regardless of being in thefront, middle, or back office.

• Licensed Real Estate Broker• ARES Certified Master• Certified Building Administrator

Number of executives and employees(excluding dispatched employees)

2396┃Flextime system and diversification of working places┃ Asset Management Company introduced a flextime system to support a more flexible
workstyle in line with the degree of activity.
 With the option of working at the head office and working at home, we are able to balanceboth business continuity and infection control.

Maternity or
child care leave

Male

Female(Percentage
of female)

Total

April 2020

13

23

63.9%

36

1

April 2021

15

19

55.9%

34

1

April 2022

14

19

57.6%

33

0

 Under a declared state of emergency, the percentage of employees coming to the head
office is 30% or less.

ESG initiatives at Sponsor Group Support for corporate workstyle reforms by offering satellite office services throughsuch services as ZXY Serving as lecturer of ARES Real Estate Securitization Master training course Contribution to the local communities through real estate management services

 Granting of scholarships to Yangon Technological University students

 Nurturing real estate business personnel through Karakusa Fudosanjuku (real estatebusiness seminar ) at Sponsor Group Activities in organizations such as Japan Facility Management Association (JFMA) andJapan Sustainable Building Consortium Promoting diversification of working places and hours
 Accepting technical trainees from overseas
 Supporting for the development of young athletes Contributing to ARES Real Estate Securitization Journal

28

ESG

ESG Initiatives (5)Decision-making Flow at Asset Management Company
 XYMAX REIT adopts a decision-making flow via committees in which external committee members participate in matters that significantly impact unitholders’interests with the intention of protecting unitholders’ interests.
 At the REIT Compliance Committee and REIT Investment Committee, the attendance and approval of compliance officers and external committee members are
requirements for resolutions. Accordingly, a governance system has been established to prevent arbitrary management by the Asset Management Company.

Examination bycompliance officer

Proposal by division(s) inchargeUnapproved

Acquisition and transfer of assets
Entrustment of management tointerested parties, etc.

Rejected

Rejected

Deliberation and resolution by REIT
Compliance Committee *Expenditure exceeding a certain amount, etc.

Deliberation and resolution
by REIT Investment
Committee *Rejected

Deliberation andresolution by Board of
Directors’ Meeting
Relevant
approval
procedures

Matters other than the above, etc.

* Attendance and approval by external committee members and compliance officer are imperative for approval

Compliance Education at the AssetManagement Company
 Conducting a study session on compliance hosted by the complianceofficer once a quarter or more.
 Intending to maintain and improve the knowledge on compliance aswell as fostering awareness on compliance of the employees of theAsset Management Company.

Investment Ratio in XYMAX REIT by Sponsor
 Through the holding of XYMAX REIT’s investment units by the sponsor,
improvement in unitholder value is realized by matching the interests ofinvestors.
 Holding ratio of XYMAX REIT ’s investment units by sponsor

5.0 %(as of March 31, 2022)

29

APPENDIXAPPENDIX

Characteristics of XYMAX REITXYMAX REIT realize the full potential of owned properties and maximize the unitholders’ value through relevant portfolio management
utilizing expertise and know-how accumulated in and by the XYMAX Group, the sponsor.

Characteristics of XYMAX Group Japan’s prominent real estate management record
 Real estate management record: 1,022 buildings/Gross floor area Approx. 560 million tsubo (as of January 31, 2022)
 Entrustment records by J-REIT investment corporation other than XYMAX REIT: 28 companies/189 properties (as of January 31, 2022)
 Human resources: 2,154 people engaged in real estate management, 61 people in leasing, and 64 people in CRE related business (as ofApril 1, 2022)
 Real estate management utilizing accumulated various data & development of new businesses applying expertise and know-how
 Data of Real Estate Management: Contracted rent data 40,807 buildings/134,677 cases (accumulated total as of March 31, 2022),
Asking rent data 58,619 buildings/19,239 cases (accumulated total as of March 31, 2022), Construction work data 163,895 cases(accumulated total as of February 28, 2022)
 Membership satellite office business ZXY and expanding own hotel brand, karaksa hotels.

 Track record in real estate sales and brokerage utilizing huge customer base
 Relationship with real estate owners: approximately 340 companies (as of January 31, 2022)
 Track record in property sales and brokerage: 374 buildings, approximately 588 billion yen(accumulated total from April 1, 2010 to March 31, 2022)

Utilizing XYMAX Group’s expertise and know-how as “3 Strength”

Assessment

Management

Sourcing

31

APPENDIX

The source of power to maximize unitholder value;XYMAX REIT's “3 strengths”
XYMAX REIT will maximize unitholder value by utilizing the three real estate management strengths of its sponsor, the
XYMAX Group.

“3 strengths” of XYMAX REIT

Assessment

 Through combining our knowledge gained through real estate management experiencethroughout Japan and an analysis of a huge amount of unique real estate data held by thesponsor group, we will accurately determine the market positioning of a target property,
upon estimating the appropriate level of rent and management costs for such property.

Management

 Through daily unfettered discussion, we will perform management which directly utilizes
various expertise of the sponsor group as well as input from the frontline. With close
communication with the frontline enabling quick decisions, we will maximize property
potentials, together with ensuring opportunities for internal growth.
 Utilizing the sponsor group’s direct communication with real estate owners, we will seize
property acquisition opportunities in exclusive transactions for sure.

Sourcing

 Utilizing the real estate buying and selling needs of the customer base of the CRE service
provided by the sponsor group, we will create property acquisition opportunities in
exclusive transactions.
32

APPENDIX

Balance Sheet and Statement of Income
Balance Sheet
AssetsCurrent assets
Cash and bank deposits
Cash and bank deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes refund receivable
Other

Non‐current assets
Property, plant and equipment
Buildings
Structures
Machinery and equipment
Tools, furniture and fixtures
Land
Buildings in trust
Structures in trust
Tools, furniture and fixtures in trust

Land in trust
Construction in progress in trust
Investments and other assets
Long‐term prepaid expenses
Deferred tax assets
Lease and guarantee deposits
Other

Total assets
Liabilities
Current liabilities
Operating accounts payable
Short‐term loans payable
Current portion of long-term borrowings

Accounts payable ‐ other
Income taxes payable
Accrued consumption taxes
Advances received
Other
Non‐current liabilities
Long‐term loans payable
Tenant lease hold and security
deposits
Tenant leasehold and security
deposits in trust

Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus

Total net assets
Total liabilities and net assets

7th fiscal period(As of Aug. 31, 2021)(thousand yen)

8th fiscal period(As of Feb. 28, 2022)(thousand yen)

2,959,327

3,367,159

973,089
1,904,372
28,27533,683
19,212694

1,219,048
2,080,797
19,412
41,776
6,124

36,012,109
35,912,484
307,707
1,802
10,592
22,637229,752
9,110,368
66,79322,243
26,138,580
2,006
99,62536,432
13
22,60040,57937,882,156
37,746,444
304,181
1,768
10,38918,151
229,752
8,357,255
58,11821,39628,745,430
135,71154,09813
22,60058,99938,971,437

41,249,315

5,244,446
81,2671,770,000
3,088,000
96,729878
202,993
4,577
10,493,292
9,192,000

4,544,914
90,854
1,100,000
2,796,000
209,246876
142,898
202,992
2,045
13,248,202
11,804,000

33,34933,3491,267,943

1,410,853

15,737,739

17,793,116

23,233,698

23,456,198

22,585,746
647,952

22,585,746
870,452

23,233,698

23,456,198

38,971,437

41,249,315

Statement of Income

7th fiscal period(As of Aug. 31, 2021)(thousand yen)

8th fiscal period(As of Feb. 28, 2022)(thousand yen)

Operating revenue

1,305,465

1,611,865

Leasing business revenue
Other leasing business revenue
Gain on sale of real estate property

1,193,065

1,289,778

112,400

102,432-

219,655

Operating expenses

604,122664,965

Expenses related to leasing business
Asset management fees
Asset custody fees
Administrative service fees
Directors’ compensations
Other operating expenses

481,704

490,977

76,297113,258

2,400

2,400

32,76845,834

Operating income

701,343946,900

154

136

13

14

Non‐operating income
Interest income
Settlement income on property tax,
etc.
Interest on refund
Gain on forfeiture of unclaimed
distributions
Non‐operating expenses
Interest expenses
Borrowing related expenses

Ordinary income
Income before income taxes
Total income taxes
Income taxes ‐ current
Income taxes ‐ deferred

Net income
Retained earnings brought forward
Unappropriated retained earnings(undisposed loss)

876

1,056

10,074

11,437

129

-

11

65

-

56

52,75775,79741,49842,791

11,25833,006

648,740

871,239648,740

871,239

881

879

880

878

0

0

647,859

870,360

92

92

647,952

870,452

33

APPENDIX

The 8th FP Property Acquisition
 Valor Kachigawa Store (Leasehold land)(A quasi-co-ownership interest: 50%)

┃Overview┃

RetailExclusive┃Analysis┃

Acquisition price

3,245 million yen

Appraisal value

3,330 million yen

Appraisal NOI yield

4.1%

Appraisal NOI yield
after depreciation

4.1%

Location

2-1-1, Ono-cho, Kasugai-shi,
Aichi

Access7 minutes on foot from JR
Chuo Line Kachigawa
Station Overview of the surrounding area
 Located just a 7 minute-walk from Kachigawa Station on the JR Chuo Main Line, which can be accessed from Nagoya
Station in 20 minutes, and where many commuters to Nagoya City reside.
 This is a retail area with many families at the child-rearing stage, and is suitable for retail facilities centered on foodsupermarket.
 Features of property
 A long-term fixed lease agreement for business use has been concluded with the lessee, and high revenue stability is
expected.
 The retail area of the acquired asset comprises daily-use stores such as 100-yen stores, drugstores, and specialty
stores for infants and children’s general merchandise, centered on food supermarket, and stable store sales are
expected.
 The property has three entrances and exits, as well as a highly convenient flat parking lot that can accommodate
346 cars, and presents an advantage as a retail facility, due to its high accessibility by car.

Leasable area

10,254.55㎡┃Initiatives of the XYMAX Group with the Valor Group ┃Valor Max Co., Ltd. was jointly established in 2017, in order to support the store expansion and asset strategies ofValor Holdings Co., Ltd. (the lessee of the acquired asset) by utilizing the real estate know-how of XYMAX
Corporation (the sponsor of XYMAX REIT).

34

APPENDIXThe 9th FP Property Acquisition (1) XYMAX Sapporo Odori Building┃Overview┃

Office┃Analysis┃

Acquisition price

4,707million yen

Appraisal value

4,910million yen

Appraisal NOI yield

4.2%

Appraisal NOI yield
after depreciation

3.2%

Location

5-10, Odori-nishi, Chuo-ku,
Sapporo-shi, Hokkaido

Access1 minute on foot from Odori
Station on the Sapporo City
SubwayCompletion

2020

Leasable area

3,106.42㎡

Exclusive

Changes in the office building vacancy rates of the major areas in Japan
5.0％

Sapporo23 wards of Tokyo

NagoyaOsaka

Fukuoka

4.0％
 Overview of the surrounding area
3.0％
 While office vacancy rates are rising nationwide, the office
Sapporo3.03%
vacancy rate in the Sapporo area has remained low, due to a
2.0％
(Asof Dec. 2021)
strong demand for call centers and outsourcing operations
1.0％
 The volume of offices supplied in the Sapporo area is limited,
0.0％
and this is a highly- convenient and visible property, located
2020年
2020年
2020年
2021年
2021年
2021年
2021年
Jan.
Apr. 2020年
July
Oct.
Jan.
Apr.
Jul.
Oct.
approximately 80m from the entrance of Sapporo’s
1月
4月
7月
10月
1月
4月
7月
10月
2020
2020
2020
2020
2021
2021
2021
2021
Source: Sanko Estate Co., Ltd.
underground shopping mall
 Features of property
New supply and net absorption of office buildings in Sapporo
 The typical floor area is designed to be approximately 100
新規供給
Continued robust demand fortsubo and is divisible into 3 sections, allowing it to meet a
New supply(tsubo)offices is expected in Sapporo
ネット・アブソープション
Net absorption
15,000variety of floor area needs
10,5009,600
9,600
 Other factors
10,0008,300
7,600
 As the XYMAX Group had been entrusted with the PM, and
5,300
5,200
5,000
4,300
5,000
had been carrying out tenant leasing and interior
construction for tenants prior to the building’s completion, it0
is capable of operating with an accurate grasp of tenant
1,200–△1,200△– 5,000
5,000
2020
2021
2022
2023
2024
needs and usage of the building
2020
2021
2022
2023
2024
(forecast)(forecast)(forecast)
（予測）
（予測）
（予測）
Source: Sanko Estate Co., Ltd.
 Exclusive transaction with the PM owner

35

APPENDIXThe 9th FP Property Acquisition (2) XYMAX Kiba koen Building┃Overview┃

OfficeExclusive┃Analysis┃

Acquisition price

2,003 million yen

Appraisal value

2,150 million yen

Appraisal NOI yield

5.0%

Appraisal NOI yield
after depreciation

4.5%

Location

5-11-13, Kiba, Koto-ku,
Tokyo

Access1 minute on foot from Kiba
Station on the Tokyo Metro
Tozai Line

Completion

1992

Leasable area

2,587.13㎡

 Overview of the surrounding area
 Located just a 1-minute walk from Kiba Station on the Tokyo Metro Tozai Line , with high accessibility to the nearest
station. The surrounding neighborhood is a work-dwelling area with large parks and residences.
 From Kiba Station on the Tokyo Metro Tozai Line, it takes roughly 5 minutes to reach Nihombashi Station androughly 7 minutes to reach Otemachi Station. This is a location where solid office demand is expected from theaffiliates and back offices of financial institutions and major companies, as well as medium-sized companies.
 Features of property
 The average existing tenant lease period is roughly 11 years, which is longer than the average tenant lease period
for office buildings of 9.6 years, indicating a high tendency for tenants to stay on (Source: “Analysis of Lease Periodsof Office Tenants in the 23 wards of Tokyo (2018)” by XYMAX Real Estate Institute).
 Was successful in revising rent upward, even during the COVID-19 pandemic.
 Renovation work of the common area is expected to be completed in 2022, in pursuit of even greater tenantsatisfaction.
 Other factors
 Exclusive transaction from a CRE client of the XYMAX Group36

APPENDIXThe 9th FP Property Acquisition (3) L-Place Nishikasai

Other (Residential)┃Overview┃

Exclusive┃Analysis┃

Acquisition price

901 million yen

Appraisal value

996 million yen

Appraisal NOI yield

5.6%

Appraisal NOI yield
after depreciation

5.1%

Location

6-3-10, Nishi-kasai,
Edogawa-ku, Tokyo

Access4 minutes on foot from
Nishikasai Station on theTokyo Metro Tozai Line

Completion

1986

Leasable area

2,044.18㎡

 Overview of the surrounding area
 Located just a 4-minute walk from Nishi-kasai Station on the Tokyo Metro Tozai Line, this property is currently being
used as an employee dorm of a listed company.
 From the nearest station, Nishi-kasai Station on the Tokyo Metro Tozai Line, it takes roughly 13 minutes to reach
Nihombashi Station and roughly 15 minutes to reach Otemachi Station. This is a location with high accessibility to
the city center, where offices are concentrated.
 Features of property
 Major renovation work based on the current tenant’s requests was completed in 2017, when the client moved in.
 The acquisition was carried out inexpensively, as the anticipated acquisition price represented a 9.5% discount fromthe appraisal value. This property also has good potential as a future redevelopment site.
 Other factors
 Contributes to the satisfaction and improvement of the QOL of the tenants, through the installation of working
space in the common area, etc.

37

APPENDIX

Portfolio List (1)Asset no.

OF-01

OF-02

OF-03

OF-04

OF-05

OF-06

OF-07

Asset type

OfficeOfficeOfficeOfficeOfficeOfficeOfficeProperty nameXYMAX Nishi-Shimbashi
Building

XYMAX Iwamotocho
Building

XYMAX Shinjuku-Gyoen
Building

XYMAX Kamiyacho
Building

XYMAX Higashi-Azabu
Building

XYMAX Higashi-Ueno
Building

XYMAX Hachioji Building

Location

Minato-ku, Tokyo

Chiyoda-ku, Tokyo

Shinjuku-ku, Tokyo

Minato-ku, Tokyo

Minato-ku, Tokyo

Taito-ku, Tokyo

Hachioji-shi, Tokyo

3 minutes on foot from
Iwamoto-cho Station on the
Toei Subway Shinjuku Line

2 minutes on foot from
Shinjuku Gyoenmae Stationon the Tokyo Metro
Marunouchi Line

1 minute on foot from
Kamiyacho Station on theTokyo Metro Hibiya Line

5 minutes on foot from
Akabanebashi Station on the
Toei Subway Oedo Line

3 minutes on foot from NakaOkachimachi Station Tokyo
Metro Hibiya Line

7 minutes on foot from
Kamiyacho Station on theTokyo Metro Hibiya Line

4 minutes on foot from JR
Okachimachi Station, andother

5 minutes on foot from JR
Hachioji Station

3 minutes on foot from
Uchisaiwaicho Station on the
Toei Subway Mita Line

Access6 minutes on foot from
Shimbashi Station on the JRTokyo Metro Ginza Line , andother

4 minutes on foot from Keio
Hachioji Station on the Keio
Electric Railway Keio Line

Acquisition price(million yen)

2,500

4,250

5,020

880

1,550

1,150

2,600

Land area

402.53㎡

864.83㎡

839.09㎡

228.83㎡

365.05㎡

368.84㎡

1,220.58㎡

Total floor area

2,517.50㎡

6,261.06㎡

6,084.32㎡

1,356.51㎡

2,570.13㎡

1,942.54㎡

7,404.81㎡

Leasable area

1,897.92㎡

4,152.40㎡

4,792.21㎡

1,205.27㎡

2,015.97㎡

1,735.29㎡

5,556.05㎡

Completion

2000

2001

2001

1991

1999

1999

1993

Structure/Number of
FloorsReinforced concrete structurewith flat roof 9F

Steel-framed reinforced
concrete structure with flat
roof B1F/9F

Steel-construction /Reinforced concrete structurewith flat roof B1F/9F

Steel-construction with flat
roof 8F

Steel-framed reinforced
concrete structure with flat
roof B1F/9F

Steel-framed reinforced
concrete structure with flat
roof 8F

Steel-framed reinforced
concrete/ Steel-construction
with flat roof B1F/9F

Number of tenant(As of the end of 8th FP)

8

13

6

7

5

8

23

Occupancy rate
(As of the end of 8th FP)

100.0%

98.4%

100.0%

100.0%

87.5%

100.0%

100.0%

38

APPENDIX

Portfolio List (2)Asset no.

OF-08

OF-09

OF-10

RT-01

RT-02

RT-03

RT-04

Asset type

OfficeOfficeOfficeRetailRetailRetailRetailProperty nameXYMAX Mita
Building

XYMAX Sapporo Odori
Building*1

XYMAX Kiba koen Building*1

Muza Kawasaki

Life Kawasaki Miyuki Store

Vita Seiseki-Sakuragaoka

Life Fukuizumi Store

Location

Minato-ku, Tokyo

Sapporo-shi, Hokkaido

Koto-ku, Tokyo

Kawasaki-shi, Kanagawa

Kawasaki-shi, Kanagawa

Tama-shi, Tokyo

Sakai-shi, Osaka

Access5 minutes on foot from
Mita Station on the Toei
Subway Mita Line, and other1 minute on foot from Odori
Station on the Sapporo City
Subway, Namboku Line, Tozai
Line, and Touhou Line

1 minute on foot from Kiba
Station on the Tokyo Metro
Tozai Line

JR Kawasaki Station
Directly Connected

15 minutes on foot from JR
Kashimada Station and Yako
StationKeio Electric Railway Keio Line
Seiseki Sakuragaoka Station
Directly Connected

12 minutes on foot from Otori
Station on the JR Hanwa Line

7 minutes on foot fromJR Tamachi Station

Acquisition price(million yen)

668

4,707

2,003

4,100

790

3,100

1,065

Land area

137.02㎡

499.24㎡

851.46㎡

10,669.34㎡ *2

1,879.15㎡

9,003.26㎡ *2

6,225.21㎡

Total floor area

799.78㎡

4,270.89㎡

2,995.81㎡

108,955.90㎡ *2

2,596.80㎡

62,849.56㎡ *2

3,358.26㎡

Leasable area

741.41㎡

3,106.42㎡

2,587.13㎡

3,703.88㎡

2,677.54㎡

27,610.61㎡

3,309.29㎡

Completion

1991

2020

1992

2004

1997

1999

1996

Structure/Numberof Floors

Steel-construction with flat
roof 10F

Steel-construction withflat roof B1F/10F

Reinforced concrete
structure with flat roof 6F

Steel-framed/Steel-framed
reinforced concrete structurewith flat roof/stainless steel
plate roofing B2F/27F

Steel-construction with flat
roof 2F

Steel-framed reinforced
concrete structure/reinforced
concrete structure/steelconstruction withflat roof B3F/27F

Steel-construction with flat
roof 2F

Number of tenant(As of the end of
8th FP)

10

5

5

18

1

1

1

Occupancy rate
(As of the end of
8th FP)

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%*1: These figures are as of March 2, 2022, when the properties were acquired.
*2: Both land area and total floor area above represent entire land area and total floor area, not the actual area owned by XYMAX REIT.

39

APPENDIX

Portfolio List (3)Asset no.

RT-05

RT-06

HT-01

OT-01

OT-02

Asset type

RetailRetailHotel

Other (Residential)

Other (Residential)

Property name

The Park House Totsuka Front (theRetail Portions of 1st and 2nd Floors)

Valor Kachigawa Store(Leasehold land)

Hotel Vista Sendai

Renaissance 21 Chihaya

L-Place Nishikasai*5

Location

Yokohama-shi, Kanagawa

Kasugai-shi, Aichi

Sendai-shi, Miyagi

Fukuoka-shi, Fukuoka

Edogawa-ku, Tokyo

4 minutes on foot from JR Sendai Station

Access3 minutes on foot from
JR and Yokohama shiei Subway Blue Line
Totsuka Station

7 minutes on foot from Kachigawa Stationon the JR Chuo Main Line

1 minute on foot from Miyagino Dori
Station on the Sendai City Subway TozaiLine

6 minutes on foot from Chihaya Station on
the JR Kagoshima Main Line and Nishitetsu
Chihaya Station on the West Nippon
Railway Kaizuka Line

4 minutes on foot from Nishikasai Stationon the Tokyo Metro Tozai Line

Acquisition price(million yen)

540

3,245

4,400

1,350*4901

Land area

1,595.49㎡ *1

20,509.10㎡*1

1,461.36㎡ *3

2,644.63㎡*1

854.00㎡

Total floor area

12,236.50㎡ *1-

6,977.47㎡

10,856.15㎡*1

2,044.18㎡

Leasable area

861.60㎡

10,254.55㎡*2

7,066.25㎡

5,145.49㎡*2

2,044.18㎡

Completion

2018

-

2016

2006

1986

Structure/Number of
FloorsReinforced concrete structure with flat
roof B1F/14F-

Steel-construction with flat roof 12F

Steel-framed reinforced concrete structurewith flat roof 14F

Reinforced concrete structure withflat roof 5F

Number of tenant(As of the end of 8th FP)

5

1

1

139

1

Occupancy rate
(As of the end of 8th FP)

100.0％

100.0％

100.0%

98.6％

100.0%*1: Both land area and total floor area above represent entire land area and total floor area, not the actual area owned by XYMAX REIT.
*2: The figures are calculated by multiplying the leased floor area under the lease contract by the quasi co-ownership ratio of the beneficiary rights held by the XYMAX REIT (50%).
*3: 1,461.36 m2 includes surface rights of 524.21 m2.
*4: The figure is calculated by multiplying the acquisition price by the quasi co-ownership ratio of the beneficiary rights held by the XYMAX REIT (50%).
*5: Figures for this property are as of March 2, 2022, when it was acquired.

40

APPENDIX

Portfolio Map┃ Country wide area┃┃ 23 wards of Tokyo ┃41

APPENDIX

Characteristic of current office tenants┃ Office tenant diversification <based on rent revenue> (excluding obligated residences, 82 office tenants) ┃Based on business type

As of March 31, 2022

Leased area based top tenants ratio

Average tenant lease period of
offices owned by XYMAX REIT

31.46%

Wholesale

18.56%

Manufacturing
Other survice

20.76%

IT

10.81%

Medical and Welfare

5.02%

Lawyers and Accountants

4.40%

Construction business
Retail2.33%

11.33%

Top 10All tenants:

11th - 30th

10 years, 1 month
Top ten tenants by leased area:
11 years, 3 months

31th - 50th

14.94%

51th - 67th

49.45%

Average tenant lease period
of office buildings

24.29％

9.6 years*

1.68%

Restaurants

0.83%* Source: “Analysis of Lease Periods of Office Tenants in the 23 Wards ofTokyo (2018)” by XYMAX Real Estate Institute┃ Average Occupancy Rate of office (including obligated residences ）┃100%

100.0%

98%
98.1%

96%

99.5%

99.2%

98.3%

98.3%
96.6%

97.7%

96.1%

96.7%

97.9%
98.7%

97.5%
95.9%

95.8%

100.0%
98.1% 98.6%

98.8% 99.0%

97.6%
96.5%

96.8%

2021/022022/02

IPO

95.3%
94.6%

92%
90%

97.6%
96.6%

94%

99.1%

98.9%

93.1%

93.0%
The Global Financial
Crisis

91.6%

Occupancy rate of office properties owned by XYMAX REIT
Average occupancy rate of J-REIT offices

88%
2007/02

2008/02

2009/02

2010/02

2011/02

2012/022013/02

2014/02

2015/02

2016/022017/022018/02

2019/022020/0242

APPENDIX

Operating Income (Loss) from Real Estate Leasing by Asset（1/2）(thousand yen)

NishiShimbashi

Iwamotocho

Operating revenue fromreal estate leasing

81,922

133,487

188,335

42,50546,41649,336

121,812

18,108171,252

Lease business revenue

75,385

117,635

175,296

38,732

40,46343,172

106,950

16,230152,132

Other lease businessrevenue

6,536

15,852

13,039

3,773

5,952

6,164

14,862

1,877

19,120Operating expenses fromreal estate leasing（Excluding Depreciation）

19,38135,75839,627

13,50918,06913,57335,545

7,194

53,071

Tax and public dues

6,906

13,471

14,342

4,615

6,417

3,694

8,380

-

10,543

Maintenance fees

5,458

9,976

11,659

4,518

5,609

4,327

15,4092,700

14,928

Utility expenses

4,433

7,786

8,693

2,559

2,713

3,422

6,981

1,028

14,792

Repair expenses

2,010

2,859

3,732

1,219

576

1,290

2,954

1,259

5,368

Insurance premiums

59

211

203

44

78

57

264

35

183

Other expenses related
to leasing business

514

1,453

996

552

2,674

780

1,556

2,171

7,255

62,54197,728

148,708

28,99628,34635,76386,267

10,913

118,180

Depreciation

2,829

15,367

11,279

1,443

5,876

3,205

11,294

1,071

17,800Operating income (loss)
from real estate leasing

59,711

82,361

137,428

27,552

22,46932,557

74,973

9,841

100,380

ＮＯＩ

ShinjukuGyoen

Kamiyacho

HigashiAzabu

HigashiUeno

Hachioji

Mita

Muza

43

APPENDIX

Operating Income (Loss) from Real Estate Leasing by Asset（2/2）(thousand yen)

Kawasaki
MiyukiSeisekiSakuragaoka

Fukuizumi

Totsuka

Kachigawa

Sendai

Chihaya

Total

Operating revenue fromreal estate leasing

undisclosed

undisclosed

undisclosed

25,982undisclosed

undisclosed

103,495

1,392,210

Lease business revenue

undisclosed

undisclosed

undisclosed

23,211

undisclosed

undisclosed

94,576

1,289,778

Other lease businessrevenue

undisclosed

undisclosed

undisclosed

2,771

undisclosed

undisclosed

8,918

102,432

Operating expenses from realestate leasing（Excluding
Depreciation）

undisclosed

undisclosed

undisclosed

7,596

undisclosed

undisclosed

28,530348,651

Tax and public dues

undisclosed

undisclosed

undisclosed-

undisclosed

undisclosed

9,391

137,819

Maintenance fees

undisclosed

undisclosed

undisclosed

5,078

undisclosed

undisclosed

7,367

91,259

Utility expenses

undisclosed

undisclosed

undisclosed

2,362

undisclosed

undisclosed

1,555

56,329Repair expenses

undisclosed

undisclosed

undisclosed

13

undisclosed

undisclosed

4,609

28,881

Insurance premiums

undisclosed

undisclosed

undisclosed

50

undisclosed

undisclosed

233

3,485

Other expenses related toleasing business

undisclosed

undisclosed

undisclosed

90

undisclosed

undisclosed

5,372

30,87522,729174,141

26,103

18,386

11,90997,87874,964

1,043,558

Depreciation

1,581

23,403

2,223

3,763

-

22,556

18,628142,326

Operating income (loss)
from real estate leasing

21,147150,737

23,88014,623

11,90975,321

56,335901,232

ＮＯＩ44

APPENDIX

Overview of Appraisal Report
Asset
no

Asset nameAcquisitiondate

Acquisition price Book value as ofthe end of 8th FY(million yen)(million yen)

End of 7th FY(August 31, 2021)

End of 8th FY(February 28, 2022)

ChangeCapitalization rate
Capitalization rate
Appraisal
based on direct
Appraisal
based on direct
value (million yen) capitalization value (million yen) capitalization
method (%)
method (%)

Capitalization rate
based on direct
capitalization
method *2 (%)

Appraisalvalue *1
(million yen)Appraiser

The Tanizawa Sōgō

OF-01

XYMAX Nishi-Shimbashi Building

February 2018

2,500

2,516

3,220

3.6

3,290

3.5

70

-0.1 Appraisal Co., Ltd.

OF-02

XYMAX Iwamotocho Building

February 2018

4,250

4,378

5,710

3.5

5,930

3.4

220

-0.1 Institute

OF-03

XYMAX Shinjuku-Gyoen Building

February 2018

5,020

5,058

7,300

3.5

7,600

3.4

300

-0.1 Institute

OF-04

XYMAX Kamiyacho Building

February 2018

880

890

1,260

3.7

1,270

3.6

10

-0.1 Appraisal Co., Ltd.

OF-05

XYMAX Higashi-Azabu Building

February 2018

1,550

1,597

2,140

3.8

1,990

3.8

-150

- Appraisal Co., Ltd.

OF-06

XYMAX Higashi-Ueno Building

February 2018

1,150

1,170

1,620

3.9

1,660

3.9

40

- Appraisal Co., Ltd.

OF-07

XYMAX Hachioji Building

February 2018

2,600

2,665

3,570

4.8

3,580

4.7

10

-0.1 Institute

OF-08

XYMAX Mita Building

July 2021

668

678

727

4.0

736

3.8

9

-0.2 InstituteRT-01

Muza Kawasaki

February 2018

4,100

4,065

5,310

4.1

5,480

4.1

170

- Appraisal Co., Ltd.

RT-02

Life Kawasaki Miyuki Store

February 2018

790

793

978

4.2

978

4.2

-

- Appraisal Co., Ltd.

RT-03

Vita Seiseki-Sakuragaoka

February 2018

3,100

3,417

3,860

5.0

3,870

5.0

10

- Appraisal Co., Ltd.

RT-04

Life Fukuizumi Store

September 2020

1,065

1,079

1,090

4.5

1,090

4.5

-

- Appraisal Co., Ltd.

RT-05

The Park House Totsuka Front (the RetailPortions of 1st and 2nd Floors)

July 2021

540

546

622

4.5

624

4.5

2

- Appraisal Co., Ltd.

RT-06

Valor Kachigawa Store (Leasehold land)

January 2022

3,245

3,289

-

-

3,330

-

3,330

- Appraisal Co., Ltd.

HT-01

Hotel Vista Sendai

February 2018

4,400

4,234

5,200

5.0

5,280

4.9

80

-0.1 Appraisal Co., Ltd.

OT-01

Renaissance 21 Chihaya

February 2018

1,350*4

1,364*4

3,280

4.8

1,640*4

4.8-1,640- Appraisal Co., Ltd.

37,20837,74645,887-

48,348

-

2,461

-

Total / Average

Unrealized profit
or loss *3(million yen)Japan Real Estate
Japan Real Estate
The Tanizawa Sōgō
Daiwa Real Estate
Daiwa Real Estate
Japan Real Estate
Japan Real Estate

The Tanizawa Sōgō
Daiwa Real Estate

The Tanizawa Sōgō
Daiwa Real Estate

The Tanizawa Sōgō
The Tanizawa Sōgō

The Tanizawa Sōgō
The Tanizawa Sōgō

*1 : The difference between the estimated value at the end of the 7th FP and the estimated value at the end of the 8th FP is indicated.
*2 : The difference between the direct capitalization rate adopted in the real estate appraisal report for each portfolio asset in the calculation of estimated value at the end of the 7th FP and the direct capitalization rate adopted in the real estate report for each portfolio asset in the calculation of estimated value at the end of the 8th FP is indicated.
*3 : The difference between the estimated value at the end of the 8th FP and the book value at the end of the 8th FP is indicated.
*4 : The figures are calculated by multiplying by the quasi co-ownership ratio of the beneficiary rights held by the XYMAX REIT (50%)

773

1,551
2,541
379
392
489
914

57
1,414
184
452
10
77

40
1,045
275

10,60145

APPENDIX

Change in investment unit price┃ Change in investment unit price ┃ As of March 31, 2022
（yen）150,000

XYR

Tokyo Stock Exchange REIT Index

Issued price at PO
113,024 yen

140,000

130,000

120,000

110,000

IPO Issue price 105,000 yen
100,000

Closing price 125,000 yen
As of March 31, 2022

90,00080,00070,000
4/1
2020
4/1

5/1

6/1

7/1

8/1

9/1 10/1 11/1 12/1 2021
1/1 2/1 3/1
1/1

4/1

5/1

6/1

7/1

8/1

9/1 10/1 11/1 12/1 2022
1/1 2/1 3/1* The starting point of investment unit price is set on April 1, 2020, and the Tokyo Stock Exchange REIT Index is indexed based on the opening price as of April 1, 2020.

1/1

46

APPENDIX

Status of Unitholders
Share of investment units by owner type

Major Unitholders■Individuals, other ■Financial institutions ■Other domestic companies■Overseas institutions, etc. ■Securities companies

Name

5th FP

21.7%

6th FP

47.3%

24.4%

7th FP

47.3%

25.3%

8th FP

10.0%

9.9%

45.5%

30.4%

9.8%

41.1%

10.4%

16.4%

14.7%

15.3%

15.3%

Number of unitholders by owner type

Individuals, other
Financial
institutions
Other domestic
companies
Overseas
institutions, etc.
Securities
companies
Total

5th FP

6th FP

7th FP

8th FP

5,889

6,318

6,604

8,214

38

35

35

33

125

121

132

162

62

77

91

110

24

24

24

24

6,138

6,575

6,886

8,543

4.6%

Note: As of February 28, 2022

Number ofinvestment
units(unit)

Ratio*(%)

Custody Bank of Japan, Ltd. (Trust account)

28,70812.85%The Master Trust Bank of Japan, Ltd.(Trust account)

28,097

12.57%XYMAX Corporation

12,500

5.59%

Custody Bank of Japan, Ltd. (Securities investment trust
account)

10,260

4.59%

The Nomura Trust and Banking Co., Ltd.
(Investment Trust Account)

8,419

3.76%

BNP-PARIBAS SECURITIES SERVICES FRANKFURT
BRANCH/JASDEC/GERMAN RESIDENTS-AIFM

7,533

3.37%

Individual

5,593

2.50%

Aozora Bank, Ltd.

4,309

1.92%

JDC CORPORATION

3,000

1.34%

JPLLC-CL JPY

3,000

1.34%

111,41949.87%

3.7%

4.1%

2.8%

Total

* The ratio of unitholders is rounded down to the second decimal place.

47

APPENDIX

Overview of Asset Management Company
Overview
Company name

Organization
XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation
General Meeting

Location

XYMAX Akasaka 111 Building, 1-1-1 Akasaka, Minato-ku, Tokyo

Establishment

August 6, 2007

Capital

0.2 billion yen

Major shareholders
Number of
employees

AuditorBoard of Directors

XYMAX Corporation (100% stake)Compliance Committee

REIT Compliance Committee

Investment Committee

REIT Investment Committee

Internal Audit Team

Compliance OfficeCompliance Officer

33 (as of April 1, 2022)(1) Financial instruments business as prescribed in the Financial
Instruments and Exchange Act

Lines of businessof Shareholders(2) Real estate investment advisory business and discretionary realestate investment business(3) Asset management business for investment corporation
Shotaro Kanemitsu, Representative Director and President

Executives

Yasushi Yamaguchi, Director
Kazuya Sugimoto, Director
Representative

Shigeki Kawakita, Auditor

Director

Financial instruments business: Director-General of the Kanto Local Finance Bureau
Registration (FIBO) No. 1907 (Investment Management Business, Investment Advisory
and Agency Business, and Type II Financial Instruments Business)

Licenses

Discretionary transaction agency, etc. business: Minister of Land, Infrastructure,
Transport and Tourism Approval No. 118
Real Estate Specified Joint Enterprise: License No. 75 granted by Commissioner of the
Financial Services Agency and Minister of Land, Infrastructure, Transport and Tourism(for businesses referred to in items (iii) and (iv))
Real estate investment advisory business: Registration No. Sogo-57

Private Investment
Management
Department

Business
Development
Division

Business
Administration
Division

REIT
Management
Division

Business
Planning
Division

Real estate brokerage business: Governor of Tokyo License (3) No. 88223

48

APPENDIX

Overview of XYMAX Group
Company
nameOfficeRetail/Store

LogisticsHotel

XYMAX Corporation (unlisted)

Establish
ment

Locationofheadquarters

Capital

Sales

March 1, 1990
* Spin-off from Recruit Co., Ltd. through employee

participatory MBO in 2000

1-1-1 Akasaka, Minato-ku, Tokyo

3,019,615,000 yen

91,013 million yen(actual results for the fiscal year ended
March 2021)

Real estate consulting andmanagement services

Real estate consulting
CRE strategy, effective
utilization,
development/design
Consulting and planning on
inheritance, fund procurement,
etc.

Asset Management

XYMAX
XYMAX TRUSTXYMAX REAL ESTATE INVESTMENT ADVISORS/MAX-REALTY

Asset management
Asset strategy, etc.

Valormax

SG Asset Max

Real estate
management

Hokkaido

XYMAX HOKKAIDO

Property management
Building maintenance

East Japan

XYMAX

Integrated
management of
store facilities
Facility managementTokai

XYMAX TOKAI

KansaiXYMAX KANSAI

KyushuXYMAX KYUSHU

Abilitas Hospitality

RepresentativeMajor
shareholders
Numberofemployees

Representative Director, Chairman & CEO:
Masafumi Shimada
Representative Director Kenji Yoshimoto
XYMAX Shareholding Association, directors &employees, clients and financial institutions
Total: 337 (as of March 31, 2022)

6,170 (as of April 1, 2021)* Consolidated figures of the Group

Other specialized
services* Consolidated figures of the Group

Leasing brokerage

Market survey/analysis
Research/planning on
management and repair

Hotel business

Real estate appraisal
Real estate assessment/survey

XYMAX INFONISTAXYMAX REAL ESTATE
INSTITUTE

KARAKSA HOTELSXYMAX ASSETCONSULTING

Cleaning

Security

Satellite office

Risk management

XYMAX SALAMAX SECURITY SERVICEXYMAX ZXY Department

Safety Organization for
Urban Renewal

Realize growth of XYMAX REIT by drawing on all of
the XYMAX Group’s expertise and workforce

49

APPENDIX

Corporate History
Started Office Property Management Business
1982：

1996：

2000：

Started the services such planning, development,
management for the Recruit Group’s own officebuilding investment and utilization after thecreation of the “Buildings-related Division” of
Recruit Group.

Made a Full-scale Entry to Retail Property Management BusinessStarted to provide the property management
service to corporate and private owners otherthan Recruit Group.

2001：

Establishment of Retail Property Management Business Division of XYMAX

MBO from Recruit Group which gave birth to
XYMAX Group

Entry into Hotel-related Business2012：

Acquired 100% stake of Abilitas Hospitality Co., Ltd.

Started Asset Management Business
2007：

2000

2001

Started to provide hybrid
service of real estate andfinance by setting up MAXREALTY, a joint venture with
Sumitomo Mitsui Banking
Corporation.

2002

2003

2004

Made an entry into thebuilding management (BM)service by setting up XACUTechno Service Corporation, ajoint venture with Haseko
Anesis2005

Set up XYMAX Real Estate Investment Advisors Corporation

2006

2007

Enhanced the BM business byacquiring 100% stake of Asahi
Building Management
Services, Inc., a subsidiary of
the Daiei Inc.

2008

2009

2010

Entered into a business tie-up
with SG Holdings Co., Ltd., aholding company of Sagawa
Express Co., Ltd.

2011

2012

2013

Started the private REIT
business through SG Asset
Max Co., Ltd., a joint venturewith SG Realty Co., LTD.

2014

2015

2016

Opened karaksa hotel Osaka
Shinsaibashi I and karaksa
hotel Kyoto I.

2017

2018

Made an entry into
the J-REIT business

50

APPENDIX

Fertile Management Base of the XYMAX GroupThe XYMAX Group has been ranked as No. 1 domestic service provider in the PM business in terms of contracting recordof real estate management projects for six years in a row since 2010*.
■ Human resources ：2,154 people engaged in real estate management, 61 in leasing, and 64 in CRE related business(as of April 1, 2022)■ Relationship with real estate owners ： approximately 340 companies (as of the end of January, 2022)■ Track record in property sales and brokerage: ：374 buildings, approximately 588.8 billion yen(accumulated total from April 1, 2010 to March 31, 2022)┃ Real estate management record
Actual number ofcontracts

1,022 buildings(As of the end of January 2022)

Approx.

36┃

Hokkaido ·Tohoku Region

Gross floor area
Approx. 5.6 million tsubo（Approx. 18.0 million m2)

900

Central · Koushin'etsu
Region┃ Facility management record (As of the end of December 2021) ┃Actual number ofcontracts

Hokkaido Region

Number of customers

12,100 stores

130 companies

Tohoku Region
9

1,800

Central ·Kanto Region
Chugoku ·Koushin'etsu Region
5,300
Kanto Region
Shikoku Region
Kansai Region 70
590
Chugoku ·600
Shikoku Region 236
11

Kyushu ·Kyushu Region
Okinawa Region
61

Kansai Region

Okinawa Region

2,300

9

1,200

* According to each November issue of the monthly magazine Property Management from 2010 to 2015, the XYMAX Group was ranked No. 1 in terms of floor area under management for six

consecutive years since 2010.

51

Cooperation with ITBM Center

Statutory inspections, confirmation of items pointed
out/Proposing correction

Asset Value
Maintenance

Building maintenance and management(cleaning/security/maintenance)

Optimization of management specifications

Confirming of completion of repair
work/Arranging payments

Arranging contractors/Obtaining
estimates/Assessing amounts

Accounting
ReportChecking /Reporting on status of items
requiring repair

Leasing Related
Operations

Repair planning

Report/Proposal

Preparation and submission of annual budgets

Owner

Preparation of monthly reports

XYMAX Group

Issuing invoices/Confirmation of
payment/Payment of expenses

Arrangement of move-in

Tenancy screening/Negotiation for conclusion

TenantManagement

Agency’s relation

Direct leasing

Instruct/Judge

Marketing/Sales strategy planning

Checking completion of agreements on
termination/Restoration

Rent negotiations (raising/lowering)

Handling delinquent tenants

Preparation of detailed building
regulations/Guidance for tenants

Responding to tenants (responses tocomplaints, etc.)

APPENDIX

Property Management
The XYMAX Group provides consistent real estate management and operation services, ranging from Property Management(acting for owners) to Building Maintenance operations.
In addition, the XYMAX Group owns all kind of data on real estate management through a track record accumulated over theyears.
┃ Areas of Real Estate Management Operations┃┃ Data Related to Real Estate Management ┃Contracted rent data
134,677 / 40,807 (accumulated total as of March 31, 2022)

Asking rent data
19,239 / 58,619 (accumulated total as of March 31, 2022)

Construction work data
163,895 (accumulated total as of February 28, 2022)

Building
Management

52

APPENDIXITBM Center
The XYMAX Group has built a support system that uses IT to achieve a high-quality building maintenance.

┃ＩＴＢＭ ＣＥＮＴＥＲ┃XYMAX ALPHA introduces information communication technology in building maintenance operations tomaintain and provide secure and safe conditions.
Creating a more advanced, higher quality, safer and more secure building maintenance framework and value.
XYMAX ALPHA has introduced an initiative called ITBM (Information Technology Building Maintenance) into
building management.

TA (Technical Adviser) Support

Knowledge Support

TAs give backup to all building maintenance sites

Desired information can be accessed anytime, anywhere from a
dedicated website

While they are stationed at the ITBM Center, TAs use their knowledge, technology,
and know-how in building maintenance based on their experiences at various sites tobackup all site operations.

Information on managed properties as well as knowledge and information concerningbuilding maintenance operations are aggregated into a database. Information can beaccessed anytime, anywhere from devices at all sites.

Real-Time Information Gathering During of an
Emergency or Disaster

Checking with and giving instructions to thesite by the ITBM CenterIn times of fires or natural disasters, information can be shared with therelevant divisions and head office functions on a real-time basis using
video from smart devices connected on-site with the ITBM Center.
Videos sent from the site can be shown on a large display. The
information can be used for real and accurate status reporting, as thevideos and audio exchanged between the both are recorded
automatically.
Video at the time of a fire in abuilding near a property managed by
the Company.
The video was linked to the ITBM
Center after people in the building
were safely evacuated. It was thenused in reporting the status to theowner and the head office.

Site facility staff (making the rounds/on-site)

53

APPENDIX

Facility Management
The XYMAX Group conducts integrated management of retail stores of retail chains by providing services that substantiallyreduce the operational burden on store management.
Conventional store management

XYMAX store management system

Issues for clients
Each store• Shortage of manpower instore management• Optimization of cost andspecifications

Corporate
headquarters
Status confirmation

Inquires
Corporate headquarters

Order placement
Facility management
systemService providers

Orderplacement

24-hour call center

InquiresBenefits of integrated management to clients
 Improving operational efficiency of store management• Introduce call center and store management system• Reduce management staff of headquarters

 Optimizing costs, improving quality• Consolidation of contractors, unification of specifications• Reduce fixed costs (contractor fees) of stores

 Ensure thorough compliance, response to government agencies

Service providers

Each store• Operations related to response to government agencies, routine inspection• Remedy of compliance violations

54

APPENDIXKey Points by Asset TypeXYMAX REIT believes that quantity and quality of tenant demand are key factors to assess the profitability of real estate.
XYMAX REIT aims for portfolio growth by comprehensively assessing the factors below by asset type.

OfficeRetailHotel

Focus on properties with strong
attractiveness to tenants

Focus on stability of tenant
rent or property price

Focus on hotels specialized in staynear transportation hubs✔

Properties located in the 8 central✔

Properties where revenue offacilities is available for analysis✔

Hotels specialized in stay whose
revenue trends can be analyzed based on
the operational know-how of the sponsor✔

Properties with a unit rent of 10,000
yen to 20,000 yen✔

Properties where rent burden on
tenants is available for analysis✔

Properties located in areas offering
excellent access to transportation
hubs✔

Properties located within an approximate
5-minute walk from the nearest station✔

Properties where sales price islower than the market priceof overseas visitors is✔ number
expected to increase

wards of Tokyo, Central
Nagoya, Central Osaka andCentral Fukuoka

Properties located in areas where the

80% or more of the portfolio consists of office, retail, and hotel properties
55

APPENDIX

Original Sourcing Strategy
XYMAX REIT captures the needs for real estate disposal gained from the huge customer base of the XYMAX Group.
In addition, XYMAX REIT grasps the trend of real estate owners at an early stage through daily communication, so that opportunities are created for external growth.

┃Direct relationship with real estate owners┃

 More than 70% of real estate owners are concerns over about large-scale renovations of owned properties,
tenant management, and securing funds for reconstruction
 Identifies needs of property disposal arising due to the problem or concern about necessary funds

Acquisition

XYMAX REIT

 Concern for inheritance and business succession tends to increase as real estate owners get older
 Identifies needs of property disposal upon business succession and inheritance by building owners

Asset Management Company
Realization of external growth

Capture disposal
needs

XYMAX Group

Survey on building owners’ situations by XYMAX Real Estate Institute┃Anxiety in future building business (by the number of owned buildings)┃

Owner relationship, customer base
General businesscompany

Building owners

Others3 buildings or moreManagement of tenants forlarge-scale renovation andreconstruction
Securing funds for large-scalerenovations and reconstruction

Financing
InheritanceROE management

Financing

30%

50%

20%

36%

42%

23%

1-2 buildings

Measures against inheritanceand business succession

3 buildings or more
1-2 buildings

24%

52%

30%

46%

3 buildings or more

16%

1-2 buildings

20%
0%

39%

Percentage of client types for real estate management business(As of the end of January 2022)

Number ofproperties undermanagement

1,022

Others
39.8%

J-REIT
20.2%

Individual,
etc.
40.0%

● J-REIT
J-REITs including XYMAX REIT
● Individual, etc.
Individuals, asset management companies,
general business companies, etc.
● Others
Private REITs, private funds, real estatecompanies, etc.
Source: The asset management company based on material
provided by XYMAX Corporation

24%
45%

45%
20%

40%
Concerned┃Diversity among real estate owners┃

24%

35%
60%

80%

Slightly concerned

100%

Not concerned

Source: “Building Owner Survey 2017” by XYMAX Real Estate Institute┃Concerns over future building business (By age, multiple answers)┃
40 or younger

Management of tenants forlarge-scale renovation andreconstruction

50-59
60-69
70 or older
40 or younger

Securing funds for large-scalerenovations and reconstruction

50-59
60-69
70 or older
40 or younger

Measures against inheritanceand business succession

50-59
60-69
70 or older

0%

20%

40%
Concerned

60%
Slightly concerned

80%

100%

Not concerned

Source: Created by XYMAX Real Estate Institute based on the request from the asset management company

56

APPENDIXXYMAX Group’s track record of real estate disposals and real estate brokerage
External growth (number of cases, total amount and area) by capitalizing on track record in real estate
sales and brokerage.
Use and geographical area of real estate in real estate disposals andreal estate sales brokerage results

To investment corporations, etc. */Whole
Disposals and sales
brokerage
Number of cases
Disposals andsales brokerage
Total
Average perbuilding

3.3%

37

374

Office10.7%

Retail

50.8%

1.7%

588.8 billion yen

Logistics

Land

11.5%

4.1 billion yen

17.4%

Tokyo

0.7%

residential

12.4%

23 Wards of Tokyo

2.1%

Hotel

9.6%

155.3 billion yen

5 Wards of Tokyo

39.2%

8.8%
4.9%
5.0%

Nagoya Area
Fukuoka Area

21.8%

Other

Other

By asset (whole)(based on transaction price)

1.5 billion yen

Other Tokyo
Metropolitan Area
Osaka Area

By area (whole)(based on transaction price)

Source: XYMAX Corporation

Accumulated track record of real estate disposal and brokerage services(accumulated total from April 1, 2010, excluding sales to XYMAX REIT)(hundred million yen)
6,500
6,000
5,500
5,000
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0

12.9 billion yen to investment corporation, etc./Whole 49.0 billion yen(Actual results from April 1, 2010 to March 31, 2022 Fiscal year average)■ Sale and intermediary to other thaninvestment corporations, etc.

■ Sale and intermediary to investment
corporations, etc.

2,071
269
End of March
2011年3月末
2011

645
427
End of March
2012年3月末
2012

934

1,251
694

756

End of March
2013年3月末

End of March
2014年3月末

End of March
2015年3月末

2014

2,977

3,809

4,246

4,335

1,676

585
2013

2,607

3,323

2015

1,075

1,148

1,384

1,482

1,491

1,553

1,553

End of March
2016年3月末

End of March
2017年3月末

2018年3月末
End of March

End of March
2019年3月末

End of March
2020年3月末

2021年3月末
End of March

2022年3月末
End of March

2021

2022

2016

2017

2018

2019

2020

Source: XYMAX Corporation* Vehicle for acquisition and holding of properties with the intent to transfer them to real estate investment corporations

57

APPENDIX

Accumulation and utilization of original data by XYMAX Real Estate InstituteTechnology/
information
providing

XYMAX
Group
business

XYMAX Real Estate
Institute Corp.

┃Office market cycle in the 23 wards of Tokyo ┃Publication
Of
Mass media
information

Variousmedia（ New contracted rent index ）Rent Index （100＝2020Q1）

120

2008Q2110

2020Q2

100

Posting, contribution and lectures to mass media and various
media (example)
 PostingNihon Keizai Shimbun, Nikkei Business Daily, etc.

 Contribution

ARES Real Estate Securitization Journal
The Japanese journal of real estate sciences
BUILDING TOKYO, etc.

 Lectures

 Joint study Other

Waseda University Advanced Collaborative
Research Organization for Smart Society
Land Economy and Construction and Engineering
Industry Bureau, Ministry of Land, Infrastructure,
Transport and Tourism
Institute for Building Environment and Energy
Conservation (IBEC)Tokyo Telework Promotion Center
Nomura Global Real Estate Forum 2021
Nikkei Inc. Media Business EventJapan Facility Management Association (JFMA), etc.
Tokyo Univ., Nihon Univ., Waseda Univ., Univ. of Hyogo, etc.
WORKTECH
Participation in CRE at MIT in USA as an Industrial Partner

2021Q490
80

2005Q1

70

2010Q2

60
0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

（ Vacancy rate： ％）

2020
Q4

2021
Q1

2021
Q2

2021
Q3

2021
Q4

Vacancy rate

1.87%

2.30%

2.96%

3.41%

3.58%

New
contracted
rent index

92

90

89

86

88

(Source) XYMAX Real Estate Institute Corp. (Vacancy rates for March 2011 and before arecalculated based on data from a major leasing brokerage company)

58

APPENDIX

Office Market Analysis (1)Throughout the past to present, there will be robust tenant demand within the range of 10,000 to 20,000 yen in general.
XYMAX REIT believes that there is a clear correlation between convenient locations (the time required to walk to the nearest station) and theoccupancy rate.

┃Distribution of contracts concluded in the 23 wards ofTokyo (by unit price of contracted rent)┃┃Vacancy rate by time required to walk to the nearest
station in the 23 wards of Tokyo┃
（％）

（%）
20
18
16
14
12
8
6
4
2
0

（%）
20
18
16
14
12
8
6
4
2
0

（%）
20
20%
18%
18
16%
16
14%
14
12%
12
10%
8
8%
6
6%
4
4%
2
2%
0%
0

14.00

Large segments ofcontracts concludedin the market

Apr. – Jun. 2012
Number of cases：593
Number of targeted
properties：568

All locations (combined)

12.00

3–5 minute walk to the nearest station

10.00

Apr. – Jun. 2020
Number of cases：622
Number of targeted
properties：577

Within a 3‐miunte walk to the nearest station

More than a 5‐minute walk from the nearest station

8.00

6.00

4.00

Oct. – Dec. 2021
Number of cases：1,076
Number of targeted
properties：927

2.00

0.00

Unit rent (yen/tsubo)
Source: Created by XYMAX Real Estate Institute upon the Management Company request of Asset Management Company

Source: Created by XYMAX Real Estate Institute upon the request of Asset Management Company

59

APPENDIX

Office Market Analysis (2)The scarcity of small‐ and medium‐scale office buildings will improve in the future, when considering the current limited supply trend.
XYMAX REIT believes that the volatility of rent for small‐ and medium‐scale office buildings is relatively lower than that oflarge‐scale buildings and is highly stable revenues.
┃ Office Stock Pyramid 2022 covering the 23 wards (net rentable area) ┃Rent Index (100＝2020 Q1)

23 Wards of Tokyo: 12.98 million tsubo, 9,378 buildings,
average building age: 32.9 years
75
Small‐ and medium‐scale officebuildings (Gross floor area: 300‐5,000 tsubo) 70
Whole: 6.07 million tsubo, 8,620 buildings,
65

33.6 years on average┃ New contracted rent by office building scale┃
Small‐ and medium‐scale office buildings(total floor area: less than 5,000 tsubo)
Large‐scale office buildings(total floor area: 5,000 tsubo or more)

130

Large‐scale office buildings

120(Gross floor area: 5,000 tsubo or more)
Whole: 6.91 million tsubo,
758 buildings, 24.9 years on average

110

60

100

55

90

50
45
40

20 years or older:
5.04 million tsubo, (83%)

35
30
25
20
15

Less than 20 years:
1.03 million tsubo, (17%)

Building age (years)

Old seismic standard:
1.45 million tsubo (24%)

80

Old seismic standard:
1.03 million tsubo,
(15%)

70

20 years or older:3.61 million tsubo, (52%)

10

60

Less than 20 years:
3.30 million tsubo, (48%)

5
0

50

40

30

20

10

0

10

20

30

40

Rentable area (ten thousand tsubo).
Source: Survey Report by XYMAX Real Estate Institute Corp.
“[23 Wards of Tokyo] Office Stock Pyramid 2022”

Q1: Jan. - Mar. Q3: Jul. - Sep.
Q2: Apr. - Jun. Q4: Oct. - Dec.

50

2020
Q4

2021
Q1

2021
Q2

2021
Q3

2021
Q4

Small‐ and medium‐scale
office buildings (total floorarea: less than 5,000 tsubo)

91

93

90

91

90

Large‐scale office buildings(total floor area: 5,000
tsubo or more)

93

89

89

83

87

Source: Survey Report by XYMAX Real Estate Institute Corp.
“Office Market Report Tokyo Q4 2021”

60

APPENDIX

Office Demands of the Post-COVID-19 (1)The significance of an office as a “place of gathering” isbecoming evident due to issues with remote working┃Functions and values to be used as the main workplace┃0%

Issues and concerns in telework operation

20%

0%

20%

40%

60%

64.9%
48.7%
43.2%
38.8%
35.3%
34.8%
34.7%

ComfortEase for employees to concentrate on their work
Sharing of management vision

49.2%

Difficulties with communications

Increased employee satisfaction
Reduction of office costs
Ease of information security management
Health and safety management

Difficulties with management (business operations,attendance, evaluation, etc.)

40.1%

Enhanced recruitment
Improved employee work-life balance

Facilitated communication and collection of information

32.9%

Decline in employee productivity and business efficiency

Increased opportunities for interaction with the external parties
Refreshment and health promotion for employees
BCP measures
Reduce employee turnover

Difficulty in managing the physical and mental health(wellbeing) of employees

28.5%

Flexibility in where and when employees work
Correction of long working hours (overtime, working on holidays)
Reduce employee commuting and travel time

28.0%

Insufficient paperless support

Ease of managing employee attendanceEase of employee evaluation
Management in response to changing times
Support for balancing work and childcare/nursing care

Sense of inequality between those who can work
remotely and those who cannot, due to job types and…

26.9%

Ineffective digitization of approvals and other work
processes (hanko seals)

23.4%

Promotion of diversity (utilization of women, elderly, foreign human resources, etc.)

19.4%
14.3%

Measures for the expenses incurred by employees(utilities, communications, furniture and fixtures)

12.9%

Improved employee work-life balance
Ease for employees to concentrate on their work
Increased employee satisfaction
Reduction of office costs
Comfort
Revitalization of internal communication
Refreshment and health promotion for employees
Health and safety management

6.5%

Ease of information security management
Correction of long working hours (overtime, working on holidays)
Support for balancing work and childcare/nursing care
Reduce employee turnover
Increased opportunities for interaction with the external parties

1.6%

BCP measures
Enhanced recruitment

N.A.

16.7%

Management in response to changing times
Sharing of management vision
Facilitated communication and collection of information

All respondents (n=1,503/MA)

20.0%

40.0%

Ease of managing employee attendance
Promotion of diversity (utilization of women, elderly, foreign human…
Ease of employee evaluation

60.0%
45.6%

Reduce employee commuting and travel time
Flexibility in where and when employees work
Increased employee motivation

Inadequate network environment

28.4%
28.1%
26.9%
25.7%
25.3%
23.9%
21.1%
20.5%
19.9%
17.9%
17.1%
16.2%
15.5%
13.8%
13.3%
12.6%
All respondents, 'NA' 'I don't know' (n=1,358; MA)
9.1%┃Functions and values to be used as the satellite office┃0.0%

Difficulty setting an optimal remote working rate forevery department and job type

Others60%

Revitalization of internal communication
Increased employee motivation

Heavy burden of costs required to provide ICT devices,
etc.

40%

37.4%
36.8%
36.5%
36.1%
31.9%
31.9%
30.2%
21.0%
19.1%
18.6%
18.5%
16.6%
15.7%
15.0%
13.3%
13.0%
12.5%
9.3%
9.1%
8.2%
8.2%
6.8%
All respondents, 'NA' 'I don't know' (n=943; MA)
5.1%

Source: Metropolitan Area Office Demand Survey Fall 2021: July 2021 by XYMAX Real Estate Institute61

APPENDIX

Office Demands of the Post-COVID-19 (2)┃Rate of workforce for in‐office work（actual/targeted）(by industry)┃┃Rate of workforce for in‐office work（actual/targeted）(by company size)┃

40.6%

20.8%

Actural (n=273) 0.4% 28.6%

16.4%

39.8%

20.4%

42.1%

17.6%

11.4%

Manufacturing

Targeted (n=244) 0.4%18.0%
Actural (n=222)

1.8%

Targeted (n=191)

2.6%

Information andcommunications

Wholesale andretail trade

Scientificresearch,
professional
and technicalservices

Actural (n=210)

18.0%

39.3%

49.1%

14.9%

33.5%

17.1%

24.1%

17.6%

10.4%

18.1%

Actural (n=110)

6.4%

25.5%

11.8%

Targeted (n=102)

6.9%

22.5%

15.7%

Actural (n=82)

6.1%12.2%

28.8%

5.4%

31.9%

40.5%

Targeted (n=193)

24.2%

34.7%
42.7%
34.3%

Finance andinsurance

5.7%

Actural (n=42)

11.9%

Targeted (n=39)

22.9%

38.6%

19.0%

17.9%

40.5%
43.6%
1%〜39%

40%〜59%60%〜99%

40%

60%

27.0%

13.1%

36.4%

2.9% 18.4%

18.6%

33.0%

15.9%

45.0%

Targeted (n=482) 0.2% 14.1% 18.7%
Actual (n=235)
Targeted (n=211)

0.4%

80%

34.9%

27.1%
18.9%
25.9%

15.7%

0.9% 19.9%

100%
20.9%

41.1%

40.4%

25.1%

8.5%

45.0%

9.0%

1%〜39%

0% (Complete teleworking)40%〜59%60%〜99%All respondents, 'I don't know' (n=1,358; excerpts)

100% (entire workforce coming work)┃Rate of workforce for in‐office work（actual/targeted）(by area)┃
0%

13.6%
20.6%

Actual (n=956) 1.7%
Targeted (n=868)

28.0%
32.9%
28.6%
38.5%

0% (Complete teleworking)

2.7%

20%

Actual (n=540) 0.2% 20.0%

7.9%

Construction

Targeted (n=70)

Targeted (n=646)

24.8%

36.8%

53.7%

Actual (n=712)

23 wardsof Tokyo

2.6%16.4%

100%

Osaka

15.0%

80%

100% (entire workforce coming work)
All respondents, 'I don't know' (n=1,358; excerpts)

Fukuoka

2.0% 25.9%

60%

Nagoya40%

100 to 999
employees

Services (cannot Actural (n=293)
be classified toother category) Targeted (n=274)

20%

1,000 or more
employees

0%Less than 100
employees

0%

Actual (n=149)
Targeted (n=125)
Actual (n=71)
Targeted (n=64)
Actual (n=75)
Targeted (n=65)

20%

40%

29.4%

2.0% 19.8%

15.1%

80%

100%

39.7%

21.3%

0.0%
15.4% 10.1%
0.0%
8.0% 10.4%
0.0%
16.9%
16.9%
0.0%
7.8%
20.3%
0.0%
12.0% 13.3%
0.0%
10.8% 12.3%

0% (Complete teleworking)40%〜59%100% (entire workforce coming work)

60%

14.1%

36.4%
47.0%

43.2%

20.5%
27.5%
38.4%

42.3%

43.8%
38.7%

23.9%

28.1%
36.0%

33.8%

43.1%

1%〜39%
60%〜99%All respondents, 'I don't know' (n=1,358; excerpts)

Source: Metropolitan Area Office Demand Survey Fall 2021: July 2021 by XYMAX Real Estate Institute62

APPENDIX

Retail Market under the COVID-19 Pandemic
While the impact of COVID-19 on the overall retail market is limited, changes are seen in the store opening strategy due
to changes in consumer needs.
┃Trends of willingness to open new stores ┃┃Level of willingness to open new stores┃(SA)

1. Willingness to open new stores “Willing to open only in prime properties” accounts for 80% in
willingness to open new stores of the restaurant industry, largely
above the overall average.
 The retail and restaurant industries show an increased willingness
to open new stores in the residential area.
XYMAX REIT believes that the retail and restaurant industries arereviewing their store opening strategy to cater for consumer needs. The
overall retail sector shows a sign of recovery in willingness to open new
stores, although it is only a small increase.

0%2019 (n=515)
2020 (n=515)
2021 (n=283)

20%

12%
6%
8%

40%

60%

51%
50%
58%

(by business, industry; SA)

80%

100%

35%
35%
34%

2%
9%

Actively open more store (locations) to increase the number
Not willing to open, in principle
Willing to open only in prime properties
No reply

20%

40%

Suburban Roadside
Urban Roadside

In front of/near station
Residential area
Downtown shopping area
Station building/inner station
Office/Student area
Tourist area/tourist area roadside
Others
Not willing to open, in principle

23%
17%
19%
17%
14%
20%
14%
6%
4%
4%
2%
8%
10%

40%

60%

58%

100%

80%
70%
49%

┃Location to be emphasized; residential area┃(by business, industry; excerpt)

0%

51%

10%

Total (n=283)

20%

30%

2021

Restaurant (n=30)

40%

50%

60%

17%
19%
42%

Retail (n=65)
2019

80%

26%
41%
10%
30%
44%

52%

60%
45%

33%
31%
30%

20%

Actively open more store (locations) to increase the number
Not willing to open, in principle
Willing to open only in prime properties┃Location to be emphasized┃(MA; n=283)
0%0%Retail (food) (n=65)
15%
Retail (nonfood) (n=126) 6%
Restaurant (n=30) 10%
Entertainment (n=23) 0%
Service (n=39) 8%

49%
13%
23%

2019

2021

15%
23%

From “Survey on Store Strategies under the COVID‐19 Pandemic 2021” by XYMAX Real Estate Institute Corporation

2. Changes in consumer behavior and values
Willingness of businesses in the restaurant industry to open
new locations: “The increasing trend of stay‐at‐home consumption will continue” (73%)
 “Remote work (telecommuting, etc.) will continue to grow” (64%)
 “Shopping in suburban stores (outside of cities) will increase” (60%)┃Changes in consumer behavior and values（2020: n=515, 2021: n=283)┃
2021
1 The increasing trend of stay‐at‐home consumption will continue

2 Remote work (telecommuting, etc.) will continue to grow
3 Consumers of live commerce will increase
4 Actions by consumers who are motivated by SDGs will increase
5 Shopping in suburban stores (outside of cities) will increase
6 Demand for drive‐through stores will increase
7 Use of shared offices at retail properties/stores will increase
8 Consumption associated with domestic travel will increase
9 The number of people moving to rural areas will increase

Changes in consumer needs are continuing, and retail properties in thesuburbs are expected to remain robust.

10 Use of public transportation for shopping will decrease
countermeasures (for example, information on crowding) more than product lineup or
11
prices will increase
12 Overconcentration in Tokyo will continue

2020
73%
64%
63%
61%
60%
57%
57%
49%
49%
47%

85%
83%
65%
35%
65%
68%
55%
34%
52%
65%

41%

51%

11%

7%

*Total percentage of companies that responded "agree" or "somewhat agree".
*1: The new e-commerce form combination with streaming video. Talent and influencers deliver live video and viewers can purchase products while asking
questions and commenting in real time.

From “Retail Facilities in the post-COVID19 ” by XYMAX Real Estate Institute Corporation

63

APPENDIXXYMAX Group’s Expanding B to C Business Activities (ZXY)
Membership satellite office business “ZXY” leading work-style reform┃ Workplace service enabling free work-style ┃「GOOD DESIGNBEST 100」

Awarded in 2019
Participated in the Kunitachi Lounge, a pilot project of offering work
places for residents by local government, by utilizing the know-how of
ZXY operations.

 Location of workplaces

Expanding workplace by utilizing the various spaces owned
and/or leased by gymnasiums, financial institutions, and Railway
companies, etc.

 Change in number of memberships and workplaces
Members

Members

Workplaces

Workplaces250

550,000
495,000
440,000

212
The 200th workplace opened in December
2021 and the accumulated floor area
topped 10,000 tsubo in February 2022.

200
177

175

385,000
134

330,000
94

220,000

78

165,000
110,000
55,0000463,818

454,451

275,000

3,806 17

27

31

33

40

47

54

376,349
291,148

226,942

212,954
139,244
44,1995
112,681
5,69123,394
76,902

225

150
125
100
75
50
25
0

Source: XYMAX Corporation

64

APPENDIXXYMAX Group’s Expanding B to C Business Activities（karaksa hotel）
The XYMAX Group is expanding its own brand, “karaksa hotel” nationwide mainly targeting
tourists
Hokkaido

Osaka
Nov. 2017
Nov. 2019

karaksa hotel Osaka Namba *112 rooms
396 rooms karaksa hotel grande Shin-Osaka Tower *Jan. 2018

177 rooms karaksa hotel Sapporo*

Kyoto
Mar. 2016 36 rooms
karaksa hotel Kyoto I *karaksa hotel Osaka Namba

Chiba
To be opened 190 rooms

karaksa hotel Sapporo

karaksa hotel grandeShin-Osaka Tower

karaksa hotel Kyoto I

Tokyo
May 2019
Jul. 2019
Spring, 2023

OpenedTo be opened

57 rooms karaksa hotel premier Tokyo Ginza *151 rooms karaksa hotel TOKYO STATION *95 rooms

karaksa hotel premier Tokyo Ginza

karaksa hotel TOKYO STATION

Source: XYMAX Corporation (as of April 2022)* As of the date of this material, XYMAX REIT has not determined the acquisition of these properties and there is no guarantee that XYMAX REIT will acquire them in the future.

65

Disclaimer

This document is provided solely for informational purposes with regard to XYMAX REIT Investment Corporation (hereinafter, “XYMAX REIT”) and is not intended
to serve as an inducement or solicitation to trade in any product offered by XYMAX REIT. Decisions on investments are to be made using your own discretion andresponsibility.
Purchase, sale and such of XYMAX REIT’s investment units entail the risk of incurring a loss due to fluctuations in the investment unit price.
Please consult with your securities company regarding the purchase of XYMAX REIT’s investment units or investment corporation bonds. Information presented
in this document should not be interpreted, unless otherwise specified, as constituting disclosure documents or an asset management report required under
Financial Instruments and Exchange Act or the Act on Investment Trusts and Investment Corporations.
XYMAX REIT and XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation (hereinafter, the “Asset Management Company”) to which XYMAX REIT entrusts the
management of its assets are taking all possible measures to make the information contained in this document the best available. However, no assurances canbe given regarding the accuracy, validity and completeness of the information, regardless of whether it is information prepared by XYMAX REIT or the AssetManagement Company, or information received from a third party.
Among the information provided in this document, statements other than those pertaining to facts in the past or present are forward-looking statements
presented by XYMAX REIT or the Asset Management Company according to assumptions or judgement based on information available as of the date of thisdocument (the date if specified otherwise in the document). Forward-looking statements are based on assumptions such as the investment policy of XYMAXREIT, applicable laws and regulations, market environment, interest rate environment, business practice and other factors as of the preparation date of thisdocument, and do not reflect or consider changes in situations after the preparation date. Forward-looking statements include, explicit or implied, uncertainties
of existing risks, unknown risks and other factors, and may materially differ from actual performance, business results, financial status and such of XYMAX REIT.
Although this document includes statements concerning future performances, expectations and other forecasts, such statements do not guarantee the future
performances, expectations and other forecasts.
The content of this document is subject to change or repeal without prior notice. XYMAX REIT and the Asset Management Company are under no obligation to
update or publicly disclose the content of this document (including forward-looking statements).
Duplication or reproduction of any content presented in this document without the prior consent of XYMAX REIT or the Asset Management Company is strictly
prohibited.
66

～Memo～67