Presentation
Materials
for the 12th Fiscal Period
Ended February 2024
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 sponsor group, which
has Japan’s leading track record in property management.

Contents
I. Management Highlights

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 FinanceOrdinance No. 47 of 2006, as amended) with the last day of the current fiscal
period as the research dateUnrealized gain

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

LTV based on total
assetsOverview of Financial Results andII.
Earnings Forecasts

Appraisal LTV

III. Investment Status and Growth Strategy

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

Net asset per unit

(Net asset - total distribution) / total number of investment units issued andoutstanding

NAV per unit

(Net asset + unrealized gain - total distribution) / total number of investment
units issued and outstanding

Acquisition price

The sales price of the acquired assets is indicated in each sales agreement anddoes not include consumption taxes, local taxes, and brokerage fees, etc.

Notes
 Unless otherwise specified, amounts are rounded to the nearest unit and ratios are rounded off
to the first decimal place.

IV. ESGV. APPENDIX

The following abbreviations of property names are used.
•
•
•
•
•
•
•
•

XYMAX Nishi-Shimbashi Building
XYMAX Shinjuku-Gyoen Building
XYMAX Higashi-Azabu Building
XYMAX Hachioji Building
XYMAX Sapporo Odori Building
Muza Kawasaki
Vita Seiseki-Sakuragaoka
The Park House Totsuka Front

:
:
:
:
:
:
:
:

Nishi-Shimbashi
Shinjuku-Gyoen
Higashi-Azabu
Hachioji
SapporoMuza
Seiseki-Sakuragaoka
Totsuka(the Retail Portions of 1st and 2nd Floors)• Hotel Vista Sendai: Sendai

•
•
•
•
•
•
•
•

XYMAX Iwamotocho Building
XYMAX Kamiyacho Building
XYMAX Higashi-Ueno Building
XYMAX Mita Building
XYMAX Kiba koen Building
Life Kawasaki Miyuki StoreLife Fukuizumi Store
Valor Kachigawa Store(Leasehold land)• L-Place Nishikasai

:
:
:
:
:
:
:
:

Iwamotocho
Kamiyacho
Higashi-Ueno
Mita
Kiba
Kawasaki Miyuki
Fukuizumi
Kachigawa: Nishikasai

2

Management Highlights

Executive Summary The 12th FP results exceeded most recent forecasts (the “Forecasts”)
 Net income 820 million yen (4.2% up from the previous period, 5.9% up from the Forecasts)
 DPU 3,300 yen (134 yen up from the previous period, 185 yen up from the Forecasts)

 The management of properties has driven steadily Offices: High occupancy rates were maintained through stable management, and the contract occupancy
rate and economic occupancy rate were both 97.7% at the end of 12th FP
 Retail properties: Occupancy rate was maintained at 100% for stable management Hotels: In accordance with the recovery of the hotel market, rents recovered to 98.1% compared to thesame period in 2019

 Diversification of fund procurement methods and deepening of ESG initiatives
 Implemented our first investment corporation bonds (Green Bonds) and Green Loans for refinancing
 Upon reacquisition of CASBEE real estate certification, two properties were upgraded from Rank A to Rank S.

3

Management Highlights

Key Factors (at the end of 12th FP)
Debt

Asset

Number of properties

18

Asset size(based on acquisition price)

43.4 billion yen

Appraisal value

55.2 billion yen

Balance of interest-bearingdebts

19.7 billion yen

LTV based on total assets

40.9%

Appraisal LTV

33.2%

Average borrowing rate*1

0.807%

Unrealized gains(unrealized gain ratio)

11.1 billion yen (+25.3%)

Average remaining period

2 years 9 months

Profitability(based on acquisition price)

Appraisal NOI yield: 5.7%
Appraisal NOI yield after
depreciation: 5.0%

Fixed interest rate ratio

95.0%

EquityAverage building age(weighted average ofacquisition price)20.6 years

Total leasable area

85,334.25 ㎡ (25,813.55 tsubo)

Unitholders’ capital(Total number of investment units issued
and outstanding: 249,650)

Occupancy rate
(entire portfolio)

99.2%

Investment unit price

114,000 yen

Net asset per unit

101,903 yen

NAV per unit

146,665 yen

Asset type(based on acquisition price)

Office:Retail:Hotel:
Other:

58.3%
29.5%
10.1%
2.1%

Aggregate market value

28.4 billion yen
25.4 billion yen

Distribution per unit

*1: Interest rate for floating rate borrowings is calculated based on the JBA 1-month Japanese Yen TIBOR as of February 29, 2024.

3,190 yen (13th FP forecast)4

Overview of Financial Results andEarnings Forecasts

Overview of Financial Results and Earnings Forecasts

Overview of Financial Results
Overview of Financial Results for the 12th FP (Ended February 2024)(million yen)
11th FP results(A)

12th FP forecast(B)

12th FP results(C)

12th FP results
11th FP results
Comparison(C) - (A)12th FP results
12th FP forecast
Comparison(C) - (B)

Lease business revenue

1,517

1,520

1,528

+11

+8

Other leasing businessrevenue

147

149

134

-13

-15

1,665

1,670

1,662

-2

-7

Operating revenue
Expenses related toleasing business(Excluding Depreciation)
NOI
Depreciation
Leasing business income

453

457

414

-38

1,211

1,212

1,248

+36

+35

168

169

170

+2

+1

Operating revenue
Office rent revenue-4.0

Hotel variable rent

+15.0

Decrease in utility revenues-12.7

Decrease in utility expenses-17.0

Decrease in repair expenses-26.2

Increase in leasing cost

+4.9

Operating expenses

1,043

1,043

1,078

+34

+34

Absence of general unitholders’ meeting related
expenses-5.8

Non-operating expenses
Increase in loan-related costs

155

-5

-2

Operating income

882

885

922

+40

+37

2

0

0

-1

+0

93

107

98

+4

-8

Ordinary income

791

778

824

+33

+45

Net income

790

777

823

+33

+46

3,166*1

3,115

3,300

+134

+185

+4.9

Comparison with forecast for the 12th FP (ended February 2024)
Main factors for difference157(million yen)

Operating revenue
Hotel variable rent

+3.8

Decrease in utility revenues-17.7

Decrease in utility expenses-16.9

Decrease in repair expenses-14.1

Non-occurrence and carried forward of leasing costs-13.5

Operating expenses

Non-operating expenses
Decrease in interest expenses and loan-related costs

Distribution per unit (yen)(million yen)

Other operating expenses

161

Non-operating expenses

Main factors for difference-43

Other operating
expensesNon-operating income

Comparison with results for the 11th FP (ended August 2023)-8.7• Days: 11th FP: 184days, 12th FP: 182 days
*1 Includes a distribution in excess of earnings per unit of 7 yen related to the allowance for temporary differences adjustments.

6

Overview of Financial Results and Earnings Forecasts

Earnings Forecast for the 13th FP and 14th FP
Overview of Earnings Forecasts for the 13th FP (Ending August 2024) and 14th FP (Ending February 2025)(million yen)
12th FP results(A)

13th FP forecast 14th FP forecast
13th FP forecast 14th FP forecast 12th FP results 13th FP forecast(B)(C)
Comparison
Comparison(B) - (A)(C) - (B)

Lease business revenue

1,528

1,547

1,534

+18

-12

Other leasing businessrevenue

134

134

134

+0

+0

1,662

1,681

1,669

+18

-12

Operating revenue
Expenses related toleasing business(Excluding Depreciation)
NOI
Depreciation
Leasing business income
Other operating expenses

414

447

442

+33

Comparison of Financial Results for the 12th FP (Ended February 2024) andEarnings Forecasts for the 13th FP (Ending August 2024)(million yen)
Main factors for difference
Operating revenue

1,234

1,226

-14

-7

170

172

180

+2

+8

1,078

1,061

1,045

-16

-16

155

159

157

+3

-1

+7.5

Hotel variable rent

+10.4

Increase in utility revenues+4.6

Increase in utility expenses+5.2

Increase in repair expenses+9.9

Increase in tax and public dues due to revaluation+4.1

Increase in leasing cost

+9.7

Increase in interest expenses and decrease in loanrelated costs+6.7

Operating expenses

-4

1,248

Office rent revenue

Non-operating
expensesComparison of Earnings Forecasts for the 13th FP (Ending August 2024) and14th FP (Ending February 2025)(million yen)
Main factors for difference
Operating revenue

Operating income
Non-operating income

922
0

902
0

887
0

-20
-0

-14
-

98

105

109

+6

+4

Ordinary income

824

797

778

-27

-19

Net income

823

796

777

-27

-19

Non-operating expenses

Office rent revenue-11.8

Hotel variable rent

+4.3

Increase in utility revenues+2.0

Increase in utility expenses+3.3

Decrease in repair expenses+4.1

increase in fire insurance premiums+1.8

Decrease in leasing cost

-12.6

Operating expenses

Depreciation

Distribution per unit (yen)

3,300

3,190

3,114

-110

-76

+8.4

Non-operating expenses
Increase in loan-related costs+4.5• Days: 12th FP: 182 days, 13th FP: 184 days, 14th FP: 181 days

7

Investment Status and Growth Strategy

Investment Status and Growth Strategy

Status of Office Tenant – Occupancy Rate & Tenant Replacements –• Office properties (exc.

┃Status of occupancy rate & tenant replacements┃ obligated residences)(tsubo)

98.8%

99.2%

99.2%

99.1%

98.8%

99.2%

98.7%

98.8%

Scope area for the 12th FP
and 13th FP: 8,217.61 tsubo

Economic occupancy rate
for the 14th FP (forecast)

Average
97.7%

98.5%

97.0 %

8%

600
500

97.7%

98.5%

5.4%
400
4%

300

2.5%
200

348.53

100

0.9%

1.4%
0.8%

205.31116.75

76.23

0
-100

69.12

74.56
0.9%

0.00

0.0%

69.12

74.57

0.8%

0.9%

156.84236.13251.392.9%

3.1%

12th FP

13th FP

0%

Contract occupancy
rate at the end of FP
Economic occupancy
rate at the end of FP
Occupancy rate *1
Surrender rate*2■ Area contract start■ Area contract end

1.9%

-200
-300

8th FP

9th FP

10th FP

11th FP-4%(forecast)┃Average free rent period ┃*3 • Office properties (exc. obligated residences)(Month)
5
4
3
2
1
0

3.6

4.0

8th FP

9th FP

2.5

3.0

2.4

2.6

10th FP

11th FP

12th FP

13th FP(forecast)*1 Occupancy rate: Area of started contract ÷ Total leasable area
*2 Surrender rate: Area of ended contract ÷ Total leasable area
*3 Average free rent period: Total of free rent periods granted in new contracts that commenced during each period × Total contracted area of new contracts granted free rent ÷ Total contracted area of new contracts

9

Investment Status and Growth Strategy

Status of Office Tenant – Tenant Replacement & Contract Renewal –┃Status of tenant replacement and contract renewal┃ • Office properties (exc. obligated residences)■ Replacements with higher rent
■ Renewals with higher rent
■ Replacements with lower rent
% change of rent
upon replacement *2 ■ Renewals with lower rent
% change of rent
upon renewal *1(tsubo)(tsubo)
1,400
1,500
0.6%

-1.1%

900
1,000

0.3%
-0.5%

-15.3%

5.0%

6.2%

-0.1%

0.4%

40.7%

0.7%

Highlights for the 12th FP

116.75 5 new leases(3 spaces with higher rent and 2 spaces with lower rent)⇒ Change +6.2% (Monthly rent increased by 191
thousand yen)
 34 renewals(31 spaces with the same rent and 3 spaces with higher
rent)⇒ Change +0.4% (Monthly rent increased by 176
thousand yen)

-16.7%

500
400

120.5
46.08
91.48

0
(100)

250.41

23.04
76.23

38.3
72.26
36.26

228.69

23.04
95.84
23.04

377.44206.51

84.81

228.69-500

Forecast for the 13th FP(600)

8th FP

9th FP

10th FP

11th FP

12th FP

13th FP (forecast)

For renewal (tsubo)

1,307.30

883.01

1,339.31

2,983.10

2,655.47

1,128.95

For new lease(tsubo)348.53

76.23

74.56

69.12

205.31116.75

 3 new leases (3 spaces with higher rent)⇒ Change +40.7% (Monthly rent increased by 526
thousand yen) 15 renewals (12 spaces with the same rent and 3 spaces
with higher rent)⇒ Change +0.7% (Monthly rent increased by 108
thousand yen)

┃Floor area scheduled for contract renewal┃• Office properties (exc. obligated residences)■ ①Rent gap*3: over 10％■ ③Rent gap: over -10％ less than 0%(tsubo)3,000■ ②Rent gap: over 0％ less than 10％■ ④Rent gap: -10％ or lessAt the end of 12th FP

2,500(Office space only)

2,000

Unit rent for existing
contracts*4

2,617.25(25 spaces)

1,500
1,000
500

1,128.95(15 spaces)

1,649.81

1,946.16(20 spaces)(21 spaces)(27 spaces)

14th FP

15th FP

1,474.54

Assumed new unit rent*4

0

13th FP

*1
*2
*3
*4

: 16,458 yen/tsubo

16th FP: 16,261 yen/tsubo% change of rent upon renewal: (rent including CAM revenue after renewal – rent including CAM revenue before renewal) ÷ rent including CAM revenue before renewal% change of rent upon replacement: (rent including CAM revenue after tenant replacement – rent including CAM revenue before tenant replacement) ÷ rent including CAM revenue before tenant replacement
Rent gap (contractual unit rent – assumed new unit rent) ÷ assumed new unit rent
The various unit rents: Weighted average of monthly rent including CAM for 10 office properties, adjusted for leased floor area.

10

Investment Status and Growth Strategy

Portfolio Status: Hotel Vista Sendai
Rent is expected to increase in the 13 FP and onward due to the improvement of GOP, which is the source of variable rent.
┃Trends in operating results┃
120

100

Sales

Expenses

GOP

Exceeded GOP for March 2018 to February 2019(100 = March 2018 to February 2019)

115.3
104.1

101.4

100
100

113.1
91.4

98.7

80

103.1

79.9
117.8
117.6

58.6

60

100

104.2
39.1

40

66.4

20

105.1

103.2
38.7

79.1

12.5

0

Mar. 2018 to Feb. 2019 Mar. 2019 to Feb. 2020 Mar. 2020 to Feb. 2021 Mar. 2021 to Feb. 2022 Mar. 2022 to Feb. 2023 Mar. 2023 to Feb. 2024

Mar. 2024 to Feb. 2025
(forecast)ADR

8,902 yen

8,766 yen

6,657 yen

6,703 yen

8,526 yen

10,545 yen

10,828 yen

Occupancy rate

87.2%

89.5%

45.9%

68.7%

84.2%

77.4%

86.0%

RevPAR

7,762 yen

7,845 yen

3,056 yen

4,607 yen

7,178 yen

8,160 yen

9,307 yen

┃Actual and forecasted rent┃

12th FP results

13th FP forecast

14th FP forecast

Sept. 2023 to Feb. 2024

Mar. 2024 to Aug. 2024

Sept. 2024 to Feb. 2025

6.6% of 12th FP results+

2.5% of forecast+

12th FP forecast
RevPAR

7,503 yen+

9.4% of 12th FP results 11

Investment Status and Growth Strategy

Status of Individual Properties (Muza/Mita)┃Muza Kawasaki┃
Average remaining lease period: 7.6 years

Lease term expiration dates (based on leased area)
 In the 12th FP, leases expired for 10 spaces Leased■
Leases expiration dates staggeredarea (tsubo)
Other leases expiration dates
from 12th FP
500(428.03 tsubo) out of all 20 spaces.
450 No rent reduction or downtime for all 10400
spaces, and 2 spaces were leased with350
higher rent.
300
 Focused on staggering
250
the lease expiration
428.03
dates, etc. when200
re-contracting
150

210.77100
50(*Total leased area: 1,120.42 tsubo)

56.9

45.1

107.128.14

0Leases expiring in 12th FP

14th FP

15th FP

16th FP

18th FP

22nd FP

24th FP

29th FP

32nd FP┃XYMAX Mita Building┃ Renovation work completed on 9 out of 10 floors
 As a result of the renovation work, leases were concluded withhigher rent than before the renovation work.
 Operating at full occupancy since April 2024
<Percentage increase in average unit rent>
Compared with when the first refusal right was acquired+39%

Renovated unit for rent

12

Investment Status and Growth Strategy

Status of Repair and Capital Expenditure
Repair expenses are annually controlled with reference to long-term repair plan adopted in the ER, and environmental
burden is reduced through equipment construction works described in lower right of this page.
┃Major environmental equipment renovations in the
12th FP┃┃Trend of repair expenses and capital expenditure┃
Repairexpenses(thousand yen)

Capital expenditure(made by management
associations)

Capitalexpenditure

350,000

Depreciation

Average ER

324,333

300,000

250,000

The increase in capital expenditures in the 13th and 14th
fiscal periods is due to an increase in construction work to
be carried out by management associations, but they will be
paid with the reserve fund for repairs that have alreadybeen set aside and will not involve any new cash payment.
212,749

200,000
178,630

180,980
168,177

170,479

172,516

162,568

150,000
130,148

Property
name

Description of construction work

Estimated reduction(rate of reduction*1)

ShinjukuGyoen

Renewal for air conditioning systems(1 floor)

31,511 kWh/year (51.5%)

ShinjukuGyoen

LED replacement in exclusive spaces(2 floors)

45,850 kWh/year (73.3%)

Hachioji

LED replacement in exclusive spaces(partials of the spaces)

15,525 kWh/year (69.0%)

Sendai

LED replacement in hotel backyard, etc.

8,828 kWh/year (55.1%)┃Major environmental equipment renovations forthe 13th FP (planned)┃
Property
name

Description of construction work

Estimated reduction(rate of reduction*1)

Kamiyacho

LED replacement in exclusive spaces(1 floor)

8,175 kWh/year(71.5%)

ShinjukuGyoen

LED replacement in exclusive spaces(3 floors)

50,273 kWh/year(73.2%)

ShinjukuGyoen

Renewal for air conditioning systems(1 floor)

20,385 kWh/year(66.1%)

Hachioji

LED replacement in exclusive spaces(partials of the spaces)

15,300 kWh/year(74.7%)

116,384

100,000

50,00039,12855,48349,50039,18343,29429,2560
10th FP

11th FP

12th FP

13th FP(forecast)

14th FP(forecast)* Number of properties as of the end of each FP: 18* Average ER: FP average of repair expenses required over 12 years for the purpose of long-term repair expenses for ER*1 Rate of reduction: Reduction in annual power usage ÷ Annual power usage before renovation

13

Investment Status and Growth Strategy

Financial Status at the end of 12th FP (1)Implemented our first Green Bonds and Green Loans for refinancing┃Overview of refinancing in the 12th FP┃
Investors who declared investment

Green Bonds (1 billion yen)
 Strengthened its funding base by expanding the investor base (8 investors declaredinvestment) Achieved a lower interest rate than loans with the same maturity
Five-year loans at 1.23%, while investment corporation bonds were procured at
1.00%

Iizuka Shinkin Bank

Echizen Shinkin Bank

Osaka Kyoei Shinkumi
Bank

Odawara Daiichi
Shinyoukumiai Bank

TakigunNougyoukyodoukumiai

Danyo Shinkumi Bank

Choshi Shinkin Bank

Ryoubi Shinkumi

Green Loans (3.37 billion yen)

* Learn more about the Green
Finance Framework.

 First green loan procurement based on the Green Finance Framework*
 Combined with the Green Bonds, the balance of green finance is 4.3 billion yen (22.2% of the interestbearing debt)
 Reduce average interest rate increases by partly incorporating floating-rate loans┃Maturity ladder┃(million yen)

5000
4000
780

3000
4,376

1,664

4,856

4,302

2000

3,270

1,000

1000

1,681

1,230

932

0
12th FP
Ended 2/2024

13th FPEnding 8/2024

14th FPEnding 2/2025

15th FPEnding 8/2025

16th FPEnding 2/2026

Borrowings as of the end of the previous FP

17th FPEnding 8/2026

Current borrowings

18th FPEnding 2/2027

19th FPEnding 8/2027

20th FPEnding 2/2028

21st FPEnding 8/2028

22nd FPEnding 2/2029

23rd FPEnding 8/2029

24th FPEnding 2/2030

Investment corporation bonds for the period

14

Investment Status and Growth Strategy

Financial Status at the end of 12th FP (2)XYMAX REIT establishes a financial base that puts emphasis on stability and soundness in the financing, mainly composedof megabanks and regional banks, etc., that have financial business relationships with the sponsor group.
┃Lender formation┃┃Interest-bearing liabilities and the external rating┃
At the end of 11th FP

At the end of 12th FP

19.71 billion yen

19.71 billion yen

40.9%/33.3%

40.9%/33.2%

2 years 4 months

2 years 9 months

Average interest rate

0.722%

0.807%

Long-term loan ratio

100.0%

100.0%

Fixed interest rate ratio

99.0%

95.0%

R&I: Ａ– (Stable)

R&I: Ａ– (Stable)

Net proceeds from green
financing–

4.37 billion yen

Maximum amount procured
through green financing

13.11 billion yen

13.11 billion yen

LTV level vs. total assets

Possible loan amount

Appraisal LTV

45%

Approx. 3.6 billion yen

37.0%

50%

Approx. 8.8 billion yen

41.8%

Balance of interest-bearing debts
LTV based on total
assets/Appraisal LTV
Average remaining period

External rating

Number of financial
institutions

15 companies┃Financing capacity┃■ Mizuho Bank■ SMBC■ MUFG Bank
■ Resona Bank
■ Aozora Bank

20.6%
16.2%
10.1%
8.1%
7.1%

■ Nishi-Nippon CB■ Fukuoka Bank
■ Yokohama Bank
■ Chiba Bank
■ Hiroshima Bank

5.1%
5.1%
4.1%
3.9%
3.6%

■SBI Shinsei Bank
3.4%
■ Nanto Bank
3.0%
■ Higo Bank
2.5%
■ Kansai Mirai Bank
1.6%
■ Mizuho Trust & Banking 0.5%
■ Investment corporation bonds
5.1%

15

Investment Status and Growth Strategy

Growth Strategy
XYMAX REIT will strengthen cooperation with the sponsor group to spur further growth.

Support from the sponsor group• Stronger commitment • Continuous internal growth • Contribution to properties• Utilization of networks upon asset replacements and dispositions

Improving portfolio quality (stability and growth potential)

Stabilizing andimproving
distributions per unit

Increasing unitholder
value through apositive cycle

Expanding asset size

Acquisition ofproperties throughpublic offerings

16Investment Status and Growth Strategy

External Growth: Asset Types to Focus on
In an external environment that is becoming more and more inflated, we will consider properties for acquisition with aneye to the future upside and stability based on our focus points by asset type.
┃Focus points by asset type┃
External environment

Future focus

Office Higher costs due to inflation (maintenance, repair work, and utility
expenses) Rental demand varies by area and property characteristics
 Transaction yields remain low in metropolitan areas

 Focus on the investment profitability of properties located in suburban
areas of regional cities and the Tokyo economic area
 Utilize the management capability of the sponsor group in leasing,maintenance, and repair work to achieve CF stability and growth

Retail Stability of daily use commercial facilities remains unchanged after the
COVID-19 pandemic
 Possibility to benefit from inflation effects through sales percentage rent Continue to focus on daily use commercial facilities with stable sales
trendsHotel Tourism demand, including inbound demand, has recovered Some hotels are performing better than before the COVID-19 pandemic,
partly due to the effect of yen depreciation

 Actively consider properties that have revenue upside potential bytapping into tourism demand, including inbound┃Properties under consideration┃
Location

Asset type

Source8 central wards ofTokyo

Office (planned)

CRE client of the sponsor group

Hirakata, Osaka

Retail property (planned)

CRE client of the sponsor group

Core regional city

Hotel (specialized in stay)Private fund managed by thesponsor group

Regional city

Retail property (leasehold
land)

Sponsor group

Tokyo economic area

OfficeThe Asset Management
Company’s own route

Hotel (specialized in stay)Sponsor group

New
Regional ordinancedesignated cities

Focused point
Reconstruction needs of CRE clients
Located in favorable locations near train and subway stations, where high demand is expected from tenants
Development projects launched after identifying the needs of CRE clients
Tenants are expected to include daily necessities selling tenants (XYMAX REIT has already acquired preferred investment
securities)
Located in a regional economic hub and also with a high level of tourism resources, there is solid demand foraccommodation
Hotels for rent including those with variable rent
Leasehold land of retail property
Expected daily use type of business with steady sales
Located in work-dwelling areas near train and subway stations, where high demand is expected from tenantsHotels located in regional ordinance-designated cities
Hotels with rent system, including variable rent that offer spacious guest rooms to satisfy tourism demand including
inbound demand

17

ESG

ESG

Participation in External Certifications and Initiatives┃Participation in the GRESB
Assessment┃┃Signing of Principles for Financial
Action for the 21st Century┃┃Support of the TCFD
Recommendations┃ Real estate assessment 2023: 3 Star andGreen Star for two consecutive years

 The Asset Management Company of XYMAXREIT, has endorsed the ideas of the PFA21
and became a signatory on December 27,
2013.

 The Asset Management Company has
expressed its support for the TCFD
recommendations and has also joined the
TCFD Consortium, whose members consist ofJapanese companies that support the TCFD.

 Disclosure assessment in 2023: “Level A” fortwo consecutive years┃Acquisition of Environmental Certification┃(As of February 29, 2024)
 Acquisition rate is 85.2% on a total floor area basis

Assessment
Rank Reacquired CASBEE real estate certification for Higashi-Azabu
and Hachioji. Both properties were upgraded from Rank A to
Rank S.

Rank S

Higashi-Azabu

Hachioji(Excellent)

Number of Acquisitionof Environmental
Certification

11 properties*

CASBEE real estatecertification

Rank S:
Rank A:

Acquisition rate(based on total floor
area)

85.2%

BELS certification★★★★ : 1 property★★★ : 1 property★★
: 1 property

5 properties
4 properties* We have acquired both CASBEE real estate certification and BELS certification for the XYMAX Higashi-Azabu Building.

19

ESG

Initiatives (1)Results of environmental initiatives┃Environmental targets┃ Revised environmental targets with more medium- and long-term initiatives in mind
• GHG emissions: 50% reduction in annual Scope 1+2 GHG emissions intensity (market basis) (t-CO2e) derived from energy consumption of properties inour portfolio from the FY2018 (base year) level by FY2030 (target year)• Water use: No increase in annual water use intensity in the owner/tenant management area from the FY2018 (base year) level until FY2030 (target year)┃GHG emissions intensity (kg-CO2/m2)┃
100
80

76.5

71.9

┃Water use intensity (m3/m2)┃

62.9
38.2

35.4

0.90

FY 2020

FY 2021

FY 2022

0.70

0.68
0.49

0.58

0.70

0.39

0.30
0.00

FY 2019

1.26
1.04

0.60

15.2

FY 2018(base year)

1.46

1.39

1.20

20
0

1.46

1.50

60
40

1.77

1.80

Adoption of renewableenergyFY 2030(target year)■ Scope1+2

FY 2018(base year)

FY 2019

FY 2020

FY 2021

Owner management area

FY 2022

FY 2030(target year)

Tenant management area

Initiatives for reducing environmental burden┃Adoption of electricity generated from 100% renewable energy sources┃
 Promoting the adoption of electricity generated from 100% renewable energy sources, such as
switching from electricity supply and demand contracts for properties we own to electricity plans with
virtually zero CO2 emissions┃Green Lease initiative┃ Aiming to improve the environmental performance of properties through a collaborative effort withtenants, XYMAX REIT is promoting Green Leases

Targeted electricity
consumption

Number of tenants
covered by Green
Leases1,646 thousand kWh(based on the 12th FP)

32 tenants(based on the 12th FP)

20

ESG

Initiatives (2)Initiatives for tenants and local communities┃Resilience measures fordisasters, etc.┃
 Introduction of emergency storage boxes
 Introduced disaster-relief vending machines┃Initiatives to improve tenant satisfaction┃
This vending machine
can supply beverages
during a blackout in theevent of a disaster.

Initiatives of asset management company┃Qualification support system┃ 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 March 31, 2024)• Licensed Real Estate Broker 27• ARES Certified Master 9• Certified Building Administrator 6┃Flextime system and diversification of working places┃ We have introduced a flextime system to support flexible working styles according to work
demands.
 Employees can also work remotely from home or at any of our satellite offices scatteredthroughout the Tokyo metropolitan area.

 Introduction of digital signage in common area for 8 officeproperties in Tokyo (building electricity consumption, evacuationsites, and encouragement of power saving, etc., are posted) The PM company conducted a customer satisfaction survey over
the tenants at 9 office properties┃Respect for diversity┃
 Female employees are succeeding in a wide range of fields, regardless of being
in the front or back office.
 We prohibit discrimination and harassment in our compliance manual to create
a comfortable working environment for all employees.
Number of executives and employees(excluding
dispatched employees)
Maternity(Percentage
leave
Male
FemaleTotalof female)
March 2022

15

18

54.5%

33

0

March 2023

12

18

60.0%

30

1

March 2024

18

20

52.6%

38

0

ESG initiatives at the sponsor group Support for corporate workstyle reforms by offering satellite office services through such services
provided by ZXY
 Contribution to the environment and the local communities through real estate management
services Nurturing real estate business personnel through Karakusa Fudosan Mirai Juku (real estatebusiness seminar ) at Sponsor Group Activities in organizations such as Japan Facility Management Association (JFMA) and Japan
Sustainable Building Consortium Contribution to ARES Real Estate Securitization Journal

 Serving as lecturer of ARES Real Estate Securitization Master training course Promoting diversification of working places and hours
 Participation in the United Nations Global Compact (UNGC)
 Contribution to regional revitalization through MEQQE Accepting technical trainees from overseas
 Supporting for the development of young athletes

21

ESG

Initiatives (3) XYMAX REIT adopts a decision-making flow via committees inwhich external committee members participate in mattersthat significantly impact unitholders’ interests with theintention of protecting unitholders’ interests.
 At the REIT Compliance Committee and REIT Investment
Committee, the attendance and approval of complianceofficers and external committee members are requirements
for resolutions. Accordingly, a governance system has been
established to prevent arbitrary management by the AssetManagement Company.

Asset management fee system

Proposal by division(s) in charge

Examination by Compliance Officer

Matters other than the flow of the right, etc.

Disapprove

Matters for deliberation by REIT Compliance
Committee
Deliberation and resolution by REIT Compliance
Committee(vote in favor requires attendance and assent of external committee
members and Compliance Officer)

Vote
down
ReturnDecision-making flow at asset
management company

Set as agenda of REIT Investment Committee

Fees for a fiscal period
Total assetlinked Fee

Total assets × 0.2% per annum

NOI linked Fee

NOI × 4.0% per annum

Deliberation and resolution by REIT Investment Committee(Attendance and approval by external committee members and Compliance Officer are imperative for approval)

Acquisition and disposition fees

Matters other than the flow of the right, etc.

Acquisition Fee

Acquisition price × 1.0%*1

Disposition Fee

Gain on dispositions at the end of each period (after
deduction of loss on dispositions) × 15.0% *2

*1
*2

Vote
down

Related-party transactions
Establishment of management guidelines
Issuance of investment units of above a certain
amountOther changes in important matters

0.5%, in the case of acquisition from interested parties
0 yen, if the gains on disposition amount is negative

Report to Board of Directors

Investment ratio in
XYMAX REIT bysponsor

5.0 %(At the end of 12th FP)

Deliberation and resolution by Board of Directors

Vote
down

Along with the above, related-party transactions, establishment of management guidelines, issuance of investment
units of or above a certain amount and other changes in important matters shall be subject to the approval of XYMAXREIT’s Board of Directors prior to the transaction, and other matters shall be reported to XYMAX REIT’s Board of
Directors.

22

APPENDIXAPPENDIX

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

Characteristics of the sponsor group Japan’s prominent real estate management record
 Real estate management record: 1,142 buildings/Gross floor area Approx. 6.50 million tsubo (as of January 31, 2024)
 Entrustment records by J-REIT investment corporation other than XYMAX REIT: 31 companies/240 properties (as of January 31, 2024)
 Human resources: 2,385 people engaged in real estate management, 51 people in leasing, and 67 people in CRE related business (as ofApril 1, 2024)

 Real estate management utilizing accumulated various data & development of new businesses applying expertise and knowhow
 Data of Real Estate Management: Contracted rent data 42,464 buildings/148,692 cases (accumulated total as of March 31, 2024),
Asking rent data 61,644 buildings (accumulated total as of March 31, 2024)/18,817 cases (as of March 31, 2024), Construction work
data 183,385 cases (accumulated total as of February 29, 2024)
 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 450 companies (as of January 31, 2024)
 Track record in property sales and brokerage: 407 buildings, approximately 628.5 billion yen (accumulated total from April 1, 2010 toMarch 31, 2024)

Utilizing the sponsor group’s expertise and know-how as “3 strengths”

Assessment

Management

Sourcing

24

APPENDIXThe 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.
25

APPENDIX

Balance Sheet(Unit: thousand yen)

11th fiscal period(As of Aug. 31, 2023)(Unit: thousand yen)

12th fiscal period(As of Feb. 29, 2024)

11th fiscal period(As of Aug. 31, 2023)

AssetsLiabilities

Current assets

Current liabilities

Cash and bank deposits

1,251,963

1,279,845

Operating accounts payable

Cash and bank deposits in trust

2,537,366

2,521,848

Current portion of long-term borrowings

Operating accounts receivable

38,43633,564

Accounts payable - otherPrepaid expenses

50,67951,063

Income taxes payable

810

741

3,879,257

3,887,064

Other
Total current assets
Non-current assets

873

Advances received

247,897

236,715

4,722

1,648

4,895,216

4,812,254-

1,000,000

15,339,000

14,413,000

33,34933,972

1,729,418

1,733,561

2,091

1,095

17,103,859

17,181,629

21,999,075

21,993,884

25,440,013

25,440,013

Allowance for temporary difference adjustments-249-1,997

Total deduction from unitholders’ capital-249-1,99725,439,763

25,438,016

790,823

826,018

Total current liabilities

Structures, net

1,665

1,630

Machinery and equipment, net

9,782

9,579

Long-term loans payable

Tools, furniture and fixtures, net

8,748

6,261

Tenant leasehold and security deposits

230,346
9,839,788

Structures in trust, net

50,996

49,798

Machinery and equipment in trust, net

00Tools, furniture and fixtures in trust, net

21,70920,89433,661,874

33,661,874

154

352

44,153,654

44,113,521

Investment Securities

28,99628,996Long-term prepaid expenses

45,65449,731

16

12

Lease and guarantee deposits

22,60022,600Other

83,895132,182

Total investments and other assets

181,163

233,523

Land in trust
Construction in progress in trust
Total property, plant and equipment
Investments and other assets

Deferred tax assets

Total non-current assets

44,334,817

44,347,045

Investment corporation bond issuance costs
Total deferred assets
Total assets

Non-current liabilities
Investment corporation bonds

Tenant leasehold and security deposits in trust
Derivatives liabilities
Total non-current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Deduction from unitholders’ capital

Unitholders’ capital, net
Surplus
Unappropriated retained earnings (undisposed
loss)
Total surplus
Total unitholders’ equity

790,823

826,018

26,230,587

26,264,034-2,091-1,095

Valuation and translation adjustments

Deferred assets
Investment unit issuance costs

125,418
32,566292,994

230,346

124,195
40,835296,547

9,871,828

113,032
4,302,000

Accrued consumption taxes

Buildings, net

Buildings in trust, net

100,624
4,376,000
940

Other

Property, plant and equipment

Land

12th fiscal period(As of Feb. 29, 2024)

13,496

8,997-

13,715

13,49622,71348,227,571

48,256,823

Deferred gains or losses on hedges-2,091-1,095

Total net assets

Total valuation and translation adjustments

26,228,495

26,262,938

Total liabilities and net assets

48,227,571

48,256,823

26

APPENDIX

Statement of Income(Unit: thousand yen)

11th fiscal period
12th fiscal period(From Mar. 1, 2023 to Aug. (From Sep. 1, 2023 to Feb.
31, 2023)
29, 2024)
Operating revenue
Leasing business revenue
Other leasing business revenue
Total operating revenue

1,517,636

1,528,816

147,425

134,099

1,665,062

1,662,915

Operating expenses
Expenses related to leasing business

621,274

584,799

Asset management fees

97,082

97,932

Asset custody fees

1,267

1,265

Administrative service fees

14,554

14,528

Directors’ compensations

2,400

2,400

Other operating expenses

45,75339,083

Total operating expenses

782,332

740,008

882,729

922,906

18

18

Operating income
Non-operating income
Interest income
Compensation received (Water charge refund)

2,125

-

Gain on forfeiture of unclaimed distributions

40

204

2,184

222

Interest expenses

71,72971,507

Borrowing related expenses

17,236

21,939Amortization of investment unit issuance costs
Amortization of investment corporation bondissuance costs
Total non-operating expenses

4,498

4,498

-

464

93,46598,411

Ordinary income

791,448824,718

Income before income taxes

791,448824,718

942

875

Total non-operating income
Non-operating expenses

Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)

-5

3

937

879

790,511

823,839

312

2,179

790,823

826,01827

APPENDIX

Portfolio List (1)Asset no.

OF-01

OF-02

OF-03

OF-04

OF-05

OF-06

Asset type

OfficeOfficeOfficeOfficeOfficeOfficeProperty nameXYMAX Nishi-Shimbashi
Building

XYMAX Iwamotocho Building

XYMAX Shinjuku-Gyoen
Building

XYMAX Kamiyacho Building

XYMAX Higashi-Azabu Building

XYMAX Higashi-Ueno Building

Location

Minato-ku, Tokyo

Chiyoda-ku, Tokyo

Shinjuku-ku, Tokyo

Minato-ku, Tokyo

Minato-ku, Tokyo

Taito-ku, Tokyo

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

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

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

1 minute on foot from
Kamiyacho Station on the Tokyo
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 the Tokyo
Metro Hibiya Line

4 minutes on foot from JR
Okachimachi Station, and otherAcquisition price2,500 million yen

4,250 million yen

5,020 million yen

880 million yen

1,550 million yen

1,150 million yen

Land area

402.53 m2

864.83 m2

839.09 m2

228.83 m2

365.05 m2

368.84 m2

Total floor area

2,517.50 m2

6,261.06 m2

6,084.32 m2

1,356.51 m2

2,570.13 m2

1,942.54 m2

Leasable area

1,897.92 m2

4,152.40 m2

4,791.23 m2

1,205.27 m2

2,015.51 m2

1,750.17 m2

Completion

2000

2001

2001

1991

1999

1999

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

Number of tenants(As of the end of 12th FP)

8

13

6

7

5

7

Occupancy rate
(As of the end of 12th FP)

100.0%

98.5%

100.0%

100.0%

87.5%

86.6%

28

APPENDIX

Portfolio List (2)Asset no.

OF-07

OF-08

OF-09

OF-10

RT-01

RT-02

Asset type

OfficeOfficeOfficeOfficeRetailRetailProperty nameXYMAX Hachioji Building

XYMAX Mita Building

XYMAX Sapporo Odori Building

XYMAX Kiba koen Building

Muza Kawasaki

Life Kawasaki Miyuki Store

Location

Hachioji-shi, Tokyo

Minato-ku, Tokyo

Sapporo-shi, Hokkaido

Koto-ku, Tokyo

Kawasaki-shi, Kanagawa

Kawasaki-shi, Kanagawa

Access4 minutes on foot from Keio
Hachioji Station on the Keio
Electric Railway Keio Line

5 minutes on foot from Mita
Station on the Toei Subway Mita
Line, and other5 minutes on foot from JR
Hachioji Station

7 minutes on foot from JR
Tamachi Station

1 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
StationAcquisition price2,600 million yen

668 million yen

4,707 million yen

2,003 million yen

4,100 million yen

790 million yen

Land area

1,220.58 m2

137.02 m2

499.24 m2

851.46 m2

10,669.34 m2*1

1,879.15 m2

Total floor area

7,404.81 m2

799.78 m2

4,270.89 m2

2,995.81 m2

108,955.90 m2*1

2,596.80 m2

Leasable area

5,558.87 m2

741.41 m2

3,106.42 m2

2,587.15 m2

3,703.88 m2

2,677.54 m2

Completion

1993

1991

2020

1992

2003

1997

Structure/Number of
FloorsSteel-framed reinforced
concrete/ Steel-construction
with flat roof B1F/9F

Steel-construction with flat
roof 10F

Steel-construction with flat
roof B1F/10F

Reinforced concrete structurewith flat roof 6F

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

Steel-construction with flat
roof 2F

Number of tenants(As of the end of 12th FP)

23

7

7

7

19

1

Occupancy rate
(As of the end of 12th FP)

100.0%

79.4%

100.0%

100.0%

100.0%

100.0%*1

Both land area and total floor area above represent land area and total floor area of one building, respectively.

29

APPENDIX

Portfolio List (3)Asset no.

RT-03

RT-04

RT-05

RT-06

HT-01

OT-02

Asset type

RetailRetailRetailRetailHotel

Other (Residential)

Property name

Vita Seiseki-Sakuragaoka

Life Fukuizumi StoreThe Park House Totsuka Front(the Retail Portions of 1st and2nd Floors)

Valor Kachigawa Store(Leasehold land)

Hotel Vista Sendai

L-Place Nishikasai

Location

Tama-shi, Tokyo

Sakai-shi, Osaka

Yokohama-shi, Kanagawa

Kasugai-shi, Aichi

Sendai-shi, Miyagi

Edogawa-ku, Tokyo

AccessKeio Electric Railway Keio Line
Seiseki Sakuragaoka Station
Directly Connected

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

3 minutes on foot from JR and
Yokohama Municipal Subway
Blue Line Totsuka Station

Acquisition price

3,100 million yen

1,065 million yen

540 million yen

3,245 million yen

4,400 million yen

901 million yen

Land area

9,003.26 m2*1

6,225.21 m2

1,595.49 m2*1

20,509.10 m2*1

1,461.36 m2*3

854.00 m2

Total floor area

62,849.56 m2*1

3,358.26 m2

12,236.50 m2*1-

6,977.47 m2

2,044.18 m2

Leasable area

27,610.61 m2

3,309.29 m2

861.60 m2

10,254.55 m2*2

7,066.25 m2

2,044.18 m2

Completion

1999

1996

2018

-

2016

1986

Structure/Number of Floors

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

Steel-construction with flat
roof 2F

Reinforced concrete structurewith flat roof B1F/14F-

Steel-construction with flat
roof 12F

Reinforced concrete structurewith flat roof 5F

Number of tenants(As of the end of 12th FP)

1

1

5

1

1

1

Occupancy rate
(As of the end of 12th FP)

100.0%

100.0%

100.0%

100.0%

100.0%

100.0%

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

4 minutes on foot from JR
Sendai Station
1 minute on foot from
Miyagino Dori Station on the
Sendai City Subway Tozai Line

*1 Both land area and total floor area above represent land area and total floor area of one building, respectively.
*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.

5 minutes on foot from
Nishikasai Station on the Tokyo
Metro Tozai Line30

APPENDIX

Portfolio Map┃ Country wide area┃┃ 23 wards of Tokyo ┃31

APPENDIX

Characteristic of Current Office Tenants and the Trends of Occupancy Rate
Backed by the sponsor group’s management capabilities, we have achieved stable, long-term occupancy by office tenants.
┃Office tenant diversification <based on rent revenue> (excluding obligated residences) (81 office tenants)┃At the end of 12th FP

Based on business type

Leased area based on top tenant ratio
Wholesale

27.45%

Other service

25.06%

Manufacturing

18.52%

IT

10.30%

Real estate

5.41%

Lawyers and Accountants

3.93%

Medical and Welfare

3.50%

Bank

2.10%

Construction business

2.08%

Retail

0.90%

Restaurants

0.75%

Average tenant lease period
of offices owned by XYMAXREIT

Top 1011.97%All tenants : 11 years, 11 months
Top ten tenants by leased area:
13 years, 8 months

11th - 30th
31st - 50th

15.99%

51st -

48.02%

Average tenant lease period of
office buildings

24.02%
9.6 years*1*1

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 )┃
99.5%

100%
98.3%

98.9%
97.6%

98%
96.6%

96.1%

98.7%
97.5%

96%

98.9%

98.1%

97.9%

96.6%

96.7%

100.0%

99.1%

98.6%

98.3%

98.8%

98.1%

99.0%

97.6%

97.4%

96.8%
96.5%
96.0%

95.9%

95.8%
95.3%

94%

94.6%

93.0%

92%

IPO

93.1%

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

91.6%

90%

88%
2009/02

2010/02

2011/02

2012/022013/02

2014/02

2015/02

2016/022017/022018/02

2019/022020/022021/022022/022023/022024/01

32

APPENDIX

Sendai: Rent Conditions and Monthly Track Record┃Conditions for rent (monthly)┃
Fixed rent

Variable rent

20.5 million yen(GOP for the last year / 12 - 21.5 million yen) × α%** 0 yen, If the results of the calculation are negative┃Track record and variable rent period┃

ADR

16,000 yen

Occupancy
rate

15,000 yen

89.1%

RevPAR

14,000 yen

85.8%

84.1%

81.7%

82.2%

82.9%

78.6%

75.9%

73.3%

90%
80.3%

81.0%

80%
64.6%

11,000 yen

60.9%

10,000 yen

8,000 yen
7,000 yen

9,744

9,606
8,681
7,731

7,934

7,846

10,152

10,471
9,819

11,186

12,1688,222

6,000 yen

8,197

7,719

7,703

10,955

10,942

10,894

10,476

10,262
9,085

8,606

70%

63.8%

10,437

9,481

8,882

79.7%
70.2%

12,000 yen

9,000 yen

100%
89.7%

89.3%

13,000 yen

ADR
RevPAR

Occupancy rate

8,789

7,224

50%

8,348
7,201

40%

6,948
5,834

5,000 yen

30%

5,007

4,000 yen

60%

9,209

9,144

8,819

10,26220%

3,000 yen
2,000 yen

10%

1,000 yen
0 yen

10th FP

11th FP

2022

12th FP

13th FP

2023

2024

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Dec.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Reduce seasonal fluctuations by using themoving average of GOP, which provides
the basis for calculating variable rent

0%

Oct.

Nov.

Dec.

Jan.

Feb.

Feb.

Mar.

33

APPENDIX

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

NishiShimbashi

Iwamotocho

ShinjukuGyoen

Kamiyacho

HigashiAzabu

HigashiUeno

Hachioji

Mita

SapporoKiba

Operating revenue
from real estate leasing

86,078

146,548

188,576

43,74358,501

46,463

134,471

17,747131,069

60,921

Lease business revenue

76,160127,233

174,456

39,30749,396

41,121

113,642

15,348120,200

52,917

Other lease businessrevenue

9,918

19,315

14,119

4,436

9,105

5,342

20,8282,398

10,8698,003

Operating expenses
from real estate leasing

22,44940,06245,385

14,923

17,50520,00743,081

11,80426,553

17,214

Tax and public dues

7,647

14,252

15,421

5,089

6,991

4,024

8,388

1,396

8,093

4,007

Maintenance fees

5,471

10,26912,518

4,638

5,995

4,320

16,392

2,700

7,707

6,820

Utility expenses

7,928

11,520

9,774

3,725

3,591

4,528

12,363

1,059

9,454

5,094

Repair expenses

702

2,596

4,510

790

193

2,907

3,885

2,676

245

586

Insurance premiums

60

215

205

45

79

58

267

36

300

109

Other expenses related
to leasing business

639

1,208

2,953

634

653

4,167

1,783

3,935

753

595

NOI

63,628106,486

143,191

28,82040,996

26,456

91,3895,942

104,516

43,707

Depreciation

3,177

17,635

16,420

1,571

7,047

3,567

11,745

1,844

22,773

5,547

Operating income (loss)
from real estate leasing

60,451

88,850126,771

27,24933,94922,88879,644

4,098

81,74338,159(Excluding Depreciation)

34

APPENDIX

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

Muza

Kawasaki
MiyukiSeisekiSakuragaoka

Fukuizumi

Totsuka

Kachigawa

Sendai

Nishikasai

Total

Operating revenue
from real estate leasing

179,672

undisclosed

undisclosed

undisclosed

27,745undisclosed

undisclosed

undisclosed

1,662,915

Lease business revenue

157,626

undisclosed

undisclosed

undisclosed

23,593undisclosed

undisclosed

undisclosed

1,528,816

Other lease businessrevenue

22,046undisclosed

undisclosed

undisclosed

4,151

undisclosed

undisclosed

undisclosed

134,099

48,918undisclosed

undisclosed

undisclosed

9,608

undisclosed

undisclosed

undisclosed

414,320

Tax and public dues

11,491

undisclosed

undisclosed

undisclosed

1,836

undisclosed

undisclosed

undisclosed

153,992

Maintenance fees

15,008undisclosed

undisclosed

undisclosed

5,087

undisclosed

undisclosed

undisclosed

109,298

Utility expenses

17,236undisclosed

undisclosed

undisclosed

2,592

undisclosed

undisclosed

undisclosed

89,659Repair expenses

3,354

undisclosed

undisclosed

undisclosed-

undisclosed

undisclosed

undisclosed

29,256

Insurance premiums

185

undisclosed

undisclosed

undisclosed

51

undisclosed

undisclosed

undisclosed

3,778

Other expenses related
to leasing business

1,641

undisclosed

undisclosed

undisclosed

41

undisclosed

undisclosed

undisclosed

28,334

NOI

130,754

18,420172,623

26,10818,137

65,691

136,275

25,4481,248,595

Depreciation

17,9891,669

29,938

2,223

3,790

-

20,9602,578

170,479

Operating income (loss)
from real estate leasing

112,764

16,750142,684

23,885

14,347

65,691

115,315

22,8701,078,115

Operating expenses
from real estate leasing(Excluding Depreciation)

35

APPENDIX

Overview of Appraisal Report
End of 11th FP

Asset
no.

Asset name(August 31, 2023)
Book value
Acquisition
Capitalization
Acquisition
as of the end
rate based on
price
value
date
of 12th FP Appraisal
direct(million yen)(million yen)capitalization
method (%)(million yen)Appraisal value(million yen)Appraiser

Unrealized
profit or
loss*3(million yen)

2,500

2,514

3,420

3.2

3,410

3.2

-10

Tanizawa Sōgō
- The
Appraisal Co., Ltd.

895

4,250

4,374

5,900

3.3

5,880

3.3

-20

Real Estate- JapanInstitute

1,505

5,020

5,149

7,290

3.3

7,290

3.3

-

Real Estate- JapanInstitute

2,140

880

889

1,350

3.3

1,360

3.3

+10

- Appraisal Co., Ltd.

The Tanizawa Sōgō

470

1,550

1,594

2,000

3.8

2,000

3.7

-

Daiwa Real Estate-0.1 Appraisal
Co., Ltd.

405

1,150

1,165

1,660

3.9

1,720

3.8

+60

Daiwa Real Estate-0.1 Appraisal
Co., Ltd.

554

XYMAX Hachioji Building

2,600

2,635

3,630

4.6

3,630

4.5

-

Real Estate-0.1 JapanInstitute

994

OF-08

XYMAX Mita Building

July 2021

668

704

748

3.7

771

3.6

+23

Real Estate-0.1 JapanInstitute

66

OF-09

XYMAX Sapporo Odori Building

March 2022

4,707

4,689

4,980

3.7

5,050

3.6

+70

Real Estate-0.1 JapanInstitute

360

OF-10

XYMAX Kiba koen Building

March 2022

2,003

2,091

2,150

4.3

2,190

4.2

+40

Real Estate-0.1 JapanInstitute

98

4,100

4,005

5,550

4.1

5,550

4.1

-

- Appraisal Co., Ltd.

The Tanizawa Sōgō

1,544

790

787

971

4.2

971

4.2

-

- Appraisal Co., Ltd.

Daiwa Real Estate

183

3,100

3,529

3,940

5.0

3,890

5.0

-50

- Appraisal Co., Ltd.

The Tanizawa Sōgō

360

1,065

1,070

1,090

4.5

1,090

4.5

-

Daiwa Real Estate- Appraisal
Co., Ltd.

19

540

534

649

4.5

666

4.5

+17

Tanizawa Sōgō
- The
Appraisal Co., Ltd.

131

3,245

3,289

3,410

-

3,410

-

-

Tanizawa Sōgō
- The
Appraisal Co., Ltd.

120
1,176
143

XYMAX Nishi-Shimbashi Building

OF-02

XYMAX Iwamotocho Building

OF-03

XYMAX Shinjuku-Gyoen Building

OF-04

XYMAX Kamiyacho Building

OF-05

XYMAX Higashi-Azabu Building

OF-06

XYMAX Higashi-Ueno Building

OF-07

RT-01

Muza Kawasaki

RT-02

Life Kawasaki Miyuki Store

RT-03

Vita Seiseki-Sakuragaoka

RT-04

Life Fukuizumi Store

February2018
February2018
February
2018
September
2020

The Park House Totsuka Front

July 2021

RT-06(the Retail Portions of 1st and 2nd Floors)

Valor Kachigawa Store (Leasehold land) January 2022

HT-01

Hotel Vista Sendai

February
2018

OT-02

L-Place Nishikasai

March 2022

Total / Average*2

ChangeCapitalization
Capitalization
rate based onrate based on*1
Appraisal value
directdirect(million yen)capitalization
capitalization
method (%)
method*2 (%)

February2018
February2018
February2018
February2018
February2018
February2018
February
2018

OF-01

RT-05

*1

End of 12th FP(February 29, 2024)

4,400

4,163

5,290

4.6

5,340

4.6

+50

Tanizawa Sōgō
- The
Appraisal Co., Ltd.

901

926

1,070

4.3

1,070

4.3

-

Tanizawa Sōgō
- The
Appraisal Co., Ltd.

43,46944,11355,098-55,288-+190

The difference between the estimated value at the end of the 11th FP and the estimated value at the end of the 12th FP is indicated.
The difference between the direct capitalization rate adopted in the real estate appraisal report for each portfolio asset in thecalculation of estimated value at the end of the 11th FP and the direct capitalization rate adopted in the real estate report for eachportfolio asset in the calculation of estimated value at the end of the 12th FP is indicated.

*3-

11,174The difference between the estimated value at the end of the 12th FP and the book value at the end of the 12th FP is indicated.

36

APPENDIX

Change in Investment Unit Price┃Change in investment unit price┃ As of March 29, 2024
(yen)

150,000
XYMAX REITTokyo Stock Exchange REIT Index

Closing price
120,000 yen
As of March 29, 2024

Issued price at
PO 113,024
yen

140,000

130,000

120,000

110,000

100,000

90,00080,00070,000
4/1
2021
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
1/1

4/1

5/1

6/1

7/1

8/1

9/1 10/1 11/1 12/1 1/1
2023 2/1 3/1

4/1

5/1

6/1

7/1

8/1

9/1 10/1 11/1 12/1 1/1
2024 2/1

1/1* The starting point of investment unit price is set on April 1, 2021, and the Tokyo Stock Exchange REIT Index is indexed based on the opening price as of April 1, 2021.

3/1

1/1

37

APPENDIX

Status of Unitholders
Share of investment units by owner type■ Individuals, other■ Financial institutions■ Other domestic companies

Major unitholders■ Overseas institutions, etc.

■ Securities companies

Number ofinvestment
units(unit)

Ratio*1(%)

Custody Bank of Japan, Ltd. (Trust account)

45,70918.30%The Master Trust Bank of Japan, Ltd. (Trust account)

38,95215.60%

3.2%

XYMAX Corporation*2

12,5005.00%

11,158

4.46%

3.8%

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

3,497

1.40%

SCBHK AC LIECHTENSTEINISCHE LANDESBANK AG

3,109

1.24%

JDC CORPORATION

3,000

1.20%

Osaka Shoko Shinkin Bank

2,526

1.01%

Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.

2,473

0.99%

Fukoku Mutual Life Insurance Company

2,055

0.82%

124,979

50.06%Name
31.2%

9th FP

10th FP

39.2%

30.7%

11th FP

45.1%

31.5%

14.4%

9.8%

44.9%

35.1%

12th FP

9.6%

10.0%

11.6%

10.5%

10.1%

45.5%

5.5%

At the end of 12th FP

5.6%

2.9%

Number of unitholders by owner type
9th FP

10th FP

11th FP

12th FP

Individuals, other

9,681

9,916

10,306

10,926

Financial institutions

34

34

33

33

184

193

193

198

110

129

124

121

Securities companies

23

19

19

22

Total

10,032

10,291

10,675

11,300

Other domestic
companies
Overseas institutions,
etc.

Total

*1 The ratio of unitholders is rounded down to the second decimal place.
*2 The company was renamed XYMAX GROUP Corporation on April 1, 2024.

38

APPENDIX

Overview of Asset Management Company
Overview
Company nameLocation

Organization
XYMAX REAL ESTATE INVESTMENT ADVISORS Corporation
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

Lines of business

Executives

Licenses

GeneralUnitholders’Meeting
AuditorBoard of Directors

XYMAX Group Corporation (100% )ESG Promotion
Committee

38 (as of March 31, 2024) including directors(1) Financial instruments business as prescribed in the Financial
Instruments and Exchange Act(2) Real estate investment advisory business and discretionary realestate investment business(3) Asset management business for investment corporation
Hideki Fukae, Representative Director and President
Yasushi Yamaguchi, Director
Kazuya Sugimoto, Director
Akimitsu Takagi, Auditor
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)
Discretionary transaction agency, etc. business: Minister of Land,
Infrastructure, Transport and Tourism Approval No. 118
Real Estate Specified Joint Enterprise: License No. 75 granted byCommissioner of the Financial Services Agency and Minister of Land,
Infrastructure, Transport and Tourism (for businesses referred to initems (iii) and (iv))
Real estate investment advisory business: Registration No. Sogo-57
Real estate brokerage business: Governor of Tokyo License (4) No.
88223

Compliance
Committee

REIT Compliance
Committee

Investment
Committee

REIT Investment
Committee

Internal Audit Team

Compliance OfficeCompliance Officer
Representative
Director

Private Investment
Management
Department

Business
Administration
Division

REIT
Management
Department

39

APPENDIX

Overview of the Sponsor Group
OfficeMarch 1, 1990
Establishment*Spin-off from Recruit Co., Ltd. through employee
participatory MBO in 2000

Location of
headquarters

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

CapitalSales

Retail/StoreHotel

3,493,365,000 yen

109,049 million yen(actual results for the fiscal year ended
March 2023) *Consolidated figures of the Group

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

Asset Management

XYMAX
XYMAX TRUSTXYMAX REAL ESTATE INVESTMENT ADVISORS/MAX-REALTY• Asset management Asset
strategy, etc.

Valormax
Hokkaido• Property management Building
maintenance

East Japan XYMAX

Integrated managementof store facilities

Representative Director, Chairman & CEO:
Masafumi Shimada
Representative Director: Kenji Yoshimoto

Major
shareholders

XYMAX Group Shareholding Association,
directors & employees, clients andfinancial institutions Total: 388 (as ofMarch 31, 2024)
366 (as of April 1, 2024)

Other specialized services

Representative

SG Asset Max

XYMAX HOKKAIDOReal estate management• Facility management

Number of
employees

LogisticsXYMAX Group Corporation (unlisted)

Real estate consulting and management services

Company nameTokai

XYMAX TOKAI

KansaiXYMAX KANSAI

KyushuXYMAX KYUSHU

Leasing brokerage

Market survey/analysis
Research/planning on
management and repair

Hotel business

Linen Supply & Cleaning

XYMAX INFONISTAXYMAX REAL ESTATE
INSTITUTE

KARAKSA HOTELSXYMAX careSS
Corporation

Cleaning

Security

Satellite office

Risk management

XYMAX SALAMAX SECURITY SERVICEXYMAX GroupZXY Department

Safety Organization for
Urban Renewal

Realize growth of XYMAX REIT by drawing on all of the sponsor group’s expertise and workforce
40

APPENDIX

Corporate History
Started Office Property Management Business
1982:

1996:

2000:

Started such service as 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

2017

2018

Opened karaksa hotel

Made an entry into
the J-REIT business

41

APPENDIX

Fertile Management Base of the Sponsor GroupThe sponsor group has been ranked as No. 1 domestic service provider in the PM business.
 Human resources: 2,385 people engaged in real estate management, 51 people in leasing, and 67 people in CRE related business(as of April 1, 2024)

 Relationship with real estate owners: approximately 450 companies (as of January 31, 2024)
 Track record in property sales and brokerage: 407 buildings, approximately 628.5 billion yen(accumulated total from April 1, 2010, to March 31, 2024)
Hokkaido Region

46┃┃Real estate management record
Actual number
Total floor areaof contracts
Approx. 6.5 million tsubo (Approx. 22.0 million m2)
1,142 buildings(As of January 31, 2024)┃Facility management record (As of December 31, 2023)┃
Actual number
Number of customersof contracts
116 companies
Approx. 8,700 stores

Hokkaido • Tohoku Region

500
Central • Koushin’etsu Region

Tohoku Region
13

1,000

Chugoku • Shikoku Region

400

Kyushu Region
Kyushu •Okinawa Region
80
900

Chugoku •Shikoku Region
12

Central • Koushin’etsu Region
Kanto Region
82

Kanto Region

3,800

645

Kansai Region

255
Kansai Region

Okinawa Region

2,100

9

42

Cooperation with ITBM Center

Statutory inspections,confirmation of items pointed
out/Proposing correction

Asset Value
Maintenance
Building maintenance andmanagement(cleaning/security/maintenance)

Optimization of management
specifications

Confirming of completion of
repair work/Arranging payments

Accounting
ReportArranging contractors/Obtaining
estimates/Assessing amounts

Leasing Related
Operations

Checking /Reporting on status of
items requiring repair

Sponsor group

Repair planning

Report/Proposal

Preparation and submission ofannual budgets

Owner

Preparation of monthly reports┃Areas of Real Estate Management Operations┃

Issuing invoices/Confirmation of
payment/Payment of expenses

Arrangement of move-in

Tenancy screening/Negotiation
for conclusion

Tenant Management

Agency’s relation

Direct leasing

Instruct/Judge

Marketing/Sales strategy
planning

Checking completion ofagreements on
termination/Restoration

Rent negotiations(raising/lowering)

Handling delinquent tenants

Preparation of detailed building
regulations/Guidance for tenants

Responding to tenants(responses to complaints, etc.)

APPENDIX

Property Management
The sponsor group provides consistent real estate management and operation services, ranging from Property
Management (acting for owners) to Building Maintenance operations.
In addition, the sponsor group owns all kind of data on real estate management through a track record accumulated over
the years.
┃Data Related to Real Estate Management┃
Contracted rent data
42,464 buildings / 148,692 cases (accumulated total as of March 31, 2024)

Asking rent data
61,644 buildings (accumulated total as of March 31, 2024)
18,817 cases (as of March 31, 2024)

Construction work data
183,385 cases (accumulated total as of February 29, 2024)

Building
Management

43

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

┃ＩＴＢＭ ＣＥＮＴＥＲ┃

Introducing information and communication technology in building maintenance operations to maintain andprovide safe and secure services.
Creation of advanced, high-quality, safe and secure building maintenance framework and value.
Introducing 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 to backup 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 Emergency orDisaster

Checks and instructions to the site by the
ITBM CenterIn the event of a fire or natural disaster, information can be shared inreal time via video with related departments and head office byconnecting smart devices in the field to the ITBM Center.
Videos sent from the site can be shown on a large display. Those videos
and audio exchanged between the parties are automatically recorded
for realistic and accurate information.
<A clip from a video of a fire at aneighboring building of a property
under management>
After safely evacuating the people inthe building, this video was sent to the
ITBM Center. It was used to report theincident to the owner and the head
office.

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

44

APPENDIX

Facility Management
The sponsor 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

45

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
46

APPENDIX

Original Sourcing Strategy
XYMAX REIT captures the needs for real estate disposal gained from the huge customer base of the sponsor 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.
 More than 70% of real estate owners are concerned about large-scale renovations of owned
proper es, tenant management, and securing funds for reconstruc on → Identifies needs ofproperty disposal arising due to the problem or concern about necessary funds
 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┃Direct relationship with real estate owners┃

Acquisition

XYMAX REIT
Asset Management Company

Realization of external growth

Capture disposal
needs

Sponsor group

Survey on building owners’ situations by XYMAX Real Estate Institute

Owner relationship, customer base
Building owners

General business company

OthersManagement of tenants for largescale renovation and reconstruction

Financing
InheritanceROE management┃Concerns over future building business(by the number of owned buildings)┃

Financing

Securing funds for large-scalerenovations and reconstruction
Measures against inheritance andbusiness succession

Others45.1%

J-REIT
21.3%

Individual,
etc.
33.6%

J-REITs including XYMAX REIT

● Individual, etc. Individuals, asset managementcompanies, general businesscompanies, etc.
● Others

50%

30%

3 buildings…
1-2 buildings

23%

52%

24%

1-2 buildings

20%

42%

36%

3 buildings…

Not concerned

24%

46%

24%

39%

16%

45%
45%

20%

20%

40%

35%

60%

80%

100%

Source: “Building Owner Survey 2017” by XYMAX Real Estate Institute

Percentage of client types for real estate management business (As of the end of January 2024)

Number ofproperties
undermanagement
1,142

Slightly concerned30%

1-2 buildings0%┃Diversity among real estate owners┃● J-REIT

3 buildings…

Concerned

Private REITs, private funds, realestate companies, etc.

┃Concerns over future building business(By age, multiple answers)┃

Slightly concerned

Not concerned

49 or younger

Management of tenants for largescale renovation and reconstruction

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

Securing funds for large-scalerenovations and reconstruction

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

Measures against inheritance andbusiness succession

50-59
60-69
70 or older

0%
Source: The asset management company based on material
provided by XYMAX GROUP Corporation

Concerned

20%

40%

60%

80%

100%

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

47

APPENDIX

Sponsor 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.
To investment corporations, etc.*/Whole
Disposals andsales brokerage
Number ofcases┃Use and geographical area of real estate in real estate disposals and real estate
sales brokerage results┃
1.6%

40
407

5 Wards of Tokyo

5.7%

Office

10.0%

Hotel

160.5 billion yen

Disposals andsales brokerage
Total

48.2%

10.1%

Osaka Area
37.0%

Tokyo

4.7%

residential

Other Tokyo
Metropolitan Area
Fukuoka Area

Land
10.9%

Logistics

12.5%

Nagoya Area

21.3%

Other

4.0 billion yen

Average perbuilding

18.6%
2.0%

4.7%

11.9%

628.5 billion yen

23 Wards of Tokyo

0.7%

Retail

1.5 billion yen

By asset (whole) (based on transaction price)

Other

By area (whole)(based on transaction price)
Source: XYMAX Group 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)
7,000
6,000
5,000

■ Sale and intermediary to other thaninvestment corporations, etc.
■ Sale and intermediary to investment
corporations, etc.

11.4 billion yen to investment corporation,
etc./Whole 44.8 billion yen(Actual results from April 1, 2010 to March 31, 2024 Fiscal year average)

4,000
3,000

2,977
2,071

2,000
1,000
0

269
End of March
2011

934

1,251

3,323

3,803

4,240

4,328

4,605

4,688

2,607

1,676

645
427

1,075

1,148

1,491

1,553

1,553

1,583

1,605

756

1,482

694

1,384

585

End of March2012

End of March2013

End of March2014

End of March2015

End of March2016

End of March2017

End of March2018

End of March2019

End of March
2020

End of March
2021

End of March2022

End of March2023

End of March
2024

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

48

APPENDIX

Accumulation and Utilization of Original Data by XYMAX Real Estate Institute

Data accumulation

Sponsor Groupbusiness
Technology/information
providing

XYMAX REALESTATEINSTITUTE
Research andsurveys

Details of the information delivered
We are providing the public with the results of analysis
and research from a unique perspective based on thedata we have gathered.
Survey and analysis of the real estate market
 Quarterly announcement of benchmarks
for the rental office market
 Development of new
benchmarks/contracted rent DI, newcontracted rent index, etc.
 Disclose the Office Pyramid

Publication Of
information

XYMAX Real Estate
Institute Website(Japanese version
only) Announcement of forecasts for thevolume of new offices in Tokyo and Osaka Fact finding surveys of small and mediumsized building owners
 Fact finding surveys of retail stores(renovations, openings/closings)

Society and the
publicPosting, contribution and lectures to mass media andvarious media (examples) Posting

Various newspapers, magazines, TV, and others

 Contribution ARES Real Estate Securitization Journal
Real Estate Fund Review
The Japanese journal of real estate sciences, Economic
Analysis (Cabinet Office), etc.
 Lectures

Ministry of Land, Infrastructure, Transport andSurvey and analysis of tenants

Tourism Survey on floorspace per person
 Analysis of lease periods of office tenants and retail tenants Office tenant opinion surveys, office fire prevention, how offices are being used, etc.

Tokyo Metropolitan Government

Survey and analysis of energy Survey on energy consumption and costs
for office buildings
 Analysis of the economic feasibility ofenvironment management

Survey and analysis on workstyles and offices
 Survey on office demand in major
metropolitan areas
 Survey on office workers in the Tokyo
Metropolitan Area
 Research on the flexible office market

The Real Estate Companies Association of Japan(RECAJ)
Japan Building Management InstituteJapan Telework Society, etc.
 Joint study

Hitotsubashi Univ., Waseda Univ., Keio Univ., Nihon
Univ., Univ. of Hyogo, Chiba Univ., etc.

49

APPENDIX

Office Market Analysis┃Office market cycle in the 23 wards of Tokyo┃(New contracted rent index)120
110┃New contracted rent by office building scale┃

Rent Index (100=2020 Q1)

Rent Index (100=2020 Q1)

2008Q2130

Small- and medium-scale office buildings (total floorarea: less than 5,000 tsubo)
Large-scale office buildings (total floor area: 5,000
tsubo or more)

120

2020Q2110100
2023Q4

100

90

90
80

2005Q1
80

70

2010Q2

Q1:
Q2:
Q3:
Q4:

70

60
0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Jan. - Mar.
Apr. - Jun.
Jul. - Sep.
Oct. - Dec.

60

(Vacancy rate: ％)

2022
Q4

2023
Q1

2023
Q2

2023
Q3

2023
Q4

Vacancy rate

3.88%

3.68%

3.71%

3.65%

3.41%

New contracted
rent index

87

90

89

90

88

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

Large-scale office buildings(total floor area: 5,000
tsubo or more)
Small- and medium-scale
office buildings(total floor area: less than
5,000 tsubo)

2022
Q4

2023
Q1

2023
Q2

2023
Q3

2023
Q4

85

88

88

90

86

89

93

91

90

92

Source:Survey Report by XYMAX Real Estate Institute Corp.
“Office Market Report Tokyo Q4 2023”

50

Investment Status and Growth Strategy

Trends in Office Market and Advantages of XYMAX REIT (1)The 10 office properties held by XYMAX REIT Investment Corporation
Unit rent for existing contracts: 16,458 yen/tsubo; average minutes from the nearest station*1: 2.7 minutes; average building age*2: 21.6 years; average floorarea: 1,095 tsubo＊1 Simple average of the time required to walk to the nearest station at the 10 office properties ＊2 The weighted average of the building age of the 10 office properties was calculated using the acquisition price (at the end of the 12th FP).

 For the majority of the office contracts concluded, unit rents are in the range from 10,000 yen and 20,000 yen, indicating a substantial demand for this range
 A gap in the vacancy rate has arisen between properties with more than a 5-minute walk from the nearest station and those within a 5-minute walk┃Distribution of contracts concluded in the 23 wards of Tokyo(by unit price of contracted rent)┃

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

(%)
14.00

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

All locations (combined)
Within a 3-minute walk to the nearest
station

12.00

10.00

3-5 minute walk to the nearest station
More than a 5-minute walk from thenearest station

Apr. – Jun. 2020
8.00
Number of cases: 622
Number of targeted
properties: 577

Oct. – Dec. 2023
Number of cases:
1,245
Number of targeted
properties: 1,052

6.00

Properties with more than a 5-minute
walk from the nearest station are the firstto register higher vacancy rates

4.00

2.00

0.00

201104
201109201202
201207
201212
201305201310201403
201408201501
201506201511
201604
201609201702
201707201712
201805201810201903
201908202001202006202011202104202109202202202207202212202305202310

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

Large segments of contracts
concluded in the market┃Vacancy rate by time required to walk to the nearest station in
the 23 wards of Tokyo┃

Unit rent (yen/tsubo)
Source: Created by XYMAX Real Estate Institute based on the request from the asset management company

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

51

Investment Status and Growth Strategy

Trends in Office Market and Advantages of XYMAX REIT (2) In both existing stock and new supply in the future, small- and medium-scale office buildings are limited compared with large-scale officebuildings
 XYMAX REIT maintains high occupancy rates at office properties due to the superior characteristics of the properties it owns, as well as
utilization of the sponsor group’s management strength┃Office Stock Pyramid 2024 covering the 23 wards (net rentable area)┃┃Volume of new offices in Tokyo’s 23 wards in 2024 (net rentable area)┃

23 Wards of Tokyo: 13.13 million tsubo, 9,410 buildings,
average building age: 34.0 years

Small- and medium-scale officebuildings (Gross floor area: 300-5,000 tsubo)
Whole: 6.04 million tsubo, 8,644 buildings,
34.8 years on average(tsubo)Large-scale office buildings (Grossfloor area: 5,000 tsubo or more)
Whole: 7.09 million tsubo, 766 buildings,
25.5 years on average

+

75
70

170,000 tsubo

Old seismic
standard:
0.89 million tsubo
(13%)

55
50

Building age (years)

40

The building age wasconcentrated in.

35

The average building age of theproperties held by XYMAX REIT

25

30

20

200

20 years or older:

177 179

148

150

118
151

100

30

10

115

182

203

Less than 20 years:

147

80

10

20

30

40

50

Rentable area (ten thousand tsubo)
Source: Survey Report by XYMAX Real Estate Institute Corp.
“Office Stock Pyramid 2024 Tokyo 23 Wards, Osaka City”

121
116

99

50

132

*

64
26

26

2014

2015

37

0
0

135

142

102

3.05 million tsubo (43%)

124

118

80

10

20

272

125

0
40

168

151

4.04 million tsubo (57%)

5
50

225

213

15
Less than 20 years:
1.02 million tsubo (17%)

131,000 tsubo

275

250

45

20 years or older:
5.02 million tsubo (83%)

Average for 2024-2027

65
60

Old seismic standard:
1.33 million tsubo(22%)

Average for 2014-2023

300

2016

16
2017

31
2018

21
2019

3
2020

16

16

22

2021

2022

2023

38
2024

27
2025

8
2026

2027

* Supply of small- and medium-scale office buildings (with floor area between 3,000 and 10,000 tsubo)■ Total floor area 10,000 tsubo or more Source: Survey Report by XYMAX Real Estate Institute Corp. “Volumeof new offices in 2024 Tokyo 23 Wards, Osaka City”■ Total floor area 3000-9,999 tsubo

52

Investment Status and Growth Strategy

Trends of Office Demand and Workplace
More companies are expecting an increase in the number of employees in their offices, with an increasing preference for expanding theirfloorspace.
Meanwhile, the need for satellite offices is expanding outside of urban centers, in line with growing demand.
┃Actual changes in office space in the past one year and┃Expected trend in the number of employees at the office┃potential changes in the future┃
20% Total percentage of those
expanded: 18.4%
14.0%

Expansion

15%

Spring 2017 (n=1,073)
Spring 2018 (n=1,250)

14.0%

13.5

11.6%

10.8%

12.5%

11.8%

10%
5.8

5%

1.7

Spring 2019 (n=1,278)

4.8

0.1

Although intentions todownsize office spaceexceeded intentions to
expand in the past two
years, the trend
reversed in 2023

0%

Spring 2020 (n=1,795)

5%

Reduction

Spring 2021 (n=1,648)
Spring 2022 (n=1,537)
Spring 2023 (n=1,722)-2.4
Total percentage of those
reduced: 4.9%

-5.8
8.2%

10%

Increase

No change

Decrease

Spring 2019
(n=1,278)

Spring 2020
(n=1,795)

Spring 2021
(n=1,648)

Spring 2022
(n=1,537)

Fall 2022(n=1,566)┃Adoption rate of remote working systems and satellite offices┃
Remote working system

RemoteworkingsystemFall 2017 (n=1,294)

19.2%

Fall 2018 (n=1,352)

18.5%

Fall 2019 (n=1,386)

Expanded

Considering to expand

Considered but stopped/suspended

ReducedConsidering to reduce

Considered but stopped/suspended

Targeted respondents: All

61.3%

Fall 2022 (n=1,566)

60.0%

10.2%

Fall 2018 (n=1,352)

11.5%

Fall 2021 (n=1,503)
Fall 2022 (n=1,566)
Fall 2023 (n=1,705)

Since the COVID-19
pandemic, more
stores are being
opened outside ofurban centers

1,500
509(35.4%)

44.9%

Fall 2017 (n=1,294)

Fall 2020 (n=1,798)(Number of properties)

51.2%

Fall 2021 (n=1,503)

Fall 2019 (n=1,386)┃Number of flexible office locations (five wards of Tokyo/18 peripheral wards)┃
2,000

Fall 2020 (n=1,798)

Satellite office (*)

(*)

80%

Source: “Metropolitan Area Office
Demand Survey Fall 2023” by
XYMAX Real Estate Institute

21.8%

Fall 2023 (n=1,705)

Satellite office

60%

Fall 2023(n=1,705)[ Potential ][ Actual ]DI (Tota l percentage of those expanded– tota l percentage of thos e reduced)

40%

Spring 2023
(n=1,722)

14.0%

20%

Source: “Metropolitan Area Office Demand Survey Spring2023” by XYMAX Real Estate Institute

20%

9.2%

16.6%

Not sure
Targeted respondents: All

0%

10.8%
11.7%
15%

424(33.7%)

1,000

20.2%
17.0%
24.2%
28.5%
30.9%

While adoption of remote
working systems isdecreasing, the adoption ofsatellite offices is increasing
Targeted respondents: All/multiple answers* Respondents who selected either “Use satellite offices, etc. provided by specialized business operators, etc.” or “Have our own or leased satellite offices, etc.”

Source:“Metropolitan Area Office Demand Survey Fall 2023” by XYMAX Real Estate Institute500

307(29.5%)
193(26.7%)
131(26.1%)
371(73.9%)531(73.3%)733(70.5%)836(66.3%)

928(64.6%)

2021

2022

2023

0
2019

2020

5 wards of Tokyo
Source: “Flexible Office Market Survey 2023” and “Flexible Office Market Survey 2024” created by
XYMAX Real Estate Institute based on the request from the asset management company

53

APPENDIX

Sponsor Group’s Expanding B to C Business Activities (ZXY)
Membership satellite office business “ZXY” making diverse ways of working possible┃New work-place for “ZXY-Work (free work-style)”┃Using clean energy

ZXY
Satellite OfficeServices

Energy, including electricity andgas at all of ZXY’s directly
managed, is in effect electricity
sourced from renewable energy.
*

We have procured and are using JCredits for renewable energy
equivalent to the annual CO2
emissions for FY2022.

Starting in December 2022, webegan a partnership with
CocoDesk, which is operated by
FUJIFILM Business Innovation
Corp.
A total of 100 CocoDesks
installed mainly in Tokyo Metro
stations became available for use
via ZXY members’ website.

 Change in number of memberships and workplaces
Members

Members

Workplaces

Workplaces

650,000

330

600,000300

550,000

270

500,000240

450,000
400,000

210

350,000

180

300,000

150

250,000
200,000
150,000
100,000
50,0000120
We have 304 directly-managed locations acrossJapan, as of the end of February 2024.

90
60

We opened ZXY Kyoto in January 2024.
Apart from the Tokyo Metropolitan Area, our location network has
expanded to include major local cities, i.e., Sapporo, Sendai, Nagoya,
Kyoto, Osaka, and Hakata.

30
0Source: XYMAX Group Corporation

54

APPENDIX

Sponsor 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

Tokyo
May 2019

57 rooms

karaksa hotel premier Tokyo Ginza*

July 2019

151 rooms

karaksa hotel TOKYO STATION*

Mar. 2023

95 rooms

karaksa hotel colors Tokyo Yaesu*

karaksa hotel premier Tokyo Ginza

Jan. 2018

177 rooms

karaksa hotel Sapporo*

karaksa hotel TOKYO STATION
karaksa hotel Sapporo

Osaka
112 rooms

karaksa hotel Osaka Namba*

Nov. 2019396 rooms

karaksa hotel grande Shin-Osaka Tower*

karaksa hotel Osaka Namba

karaksa hotel grande ShinOsaka Tower

karaksa hotel colors
Tokyo Yaesu

Nov. 2017

Source: KARAKSA HOTELS Corporation* 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.

55

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.

56

～Memo～57