Make The World
More Sustainable[Provisional Translation Only]
This English translation of the original Japanese document is provided solely for information purposes.
Should there be any discrepancies between this translation and the Japanese original, the latter shall prevail.

December 14, 2020
IssuerIchigo Office REIT Investment Corporation (“Ichigo Office,” 8975)
1-1-1 Uchisaiwaicho, Chiyoda-ku, Tokyo
Representative: Yoshihiro Takatsuka, Executive Director
www.ichigo-office.co.jp/en
Asset Management Company
Ichigo Investment Advisors Co., Ltd.
Representative: Hiroshi Iwai, President
Inquiries: Sanae Hiraoka, Head of Ichigo OfficeTel: +81-3-3502-4891

Acquisition of Office Asset (Ichigo Tachikawa Building)Consistent with its strategy as a specialized office REIT, Ichigo Office decided today toacquire an office asset, the Ichigo Tachikawa Building.
1. Asset Acquisition Summary
Asset Number
Asset Name1

O-96
Ichigo Tachikawa Building

Asset TypeOffice

Date Built

December 14, 1992

Form of Ownership

Trust beneficiary interest in real estate (juekiken)

Appraisal Value2

JPY 4,000 million

Acquisition Price3

JPY 3,830 million

SellerTachikawa Holdings GK

Contract DateDecember 14, 2020

Closing Date

December 18, 2020

Financing Method

Cash-on-hand, Loans

Settlement Method

Lump-sum payment

1Ichigo Office will change the building name from the Unizo Tachikawa Building tothe Ichigo Tachikawa Building. For purposes of this release, the building is referred toas the Ichigo Tachikawa Building.
2
Appraisal Value is calculated by Daiwa Real Estate Appraisal as of November 1, 2020,
and is in compliance with the appraisal guidelines of Ichigo Investment Advisors(“IIA”) as well as the rules of the Investment Trusts Association of Japan.
3Acquisition Price excludes incidental expenses such as fees and property, city
planning, and consumption taxes.

12. Transaction Rationale
As a specialized office REIT with stable earnings and a diverse portfolio, Ichigo Officecontinues to execute on its strategy to grow shareholder value by focusing its portfolio
on high-quality, mid-size office assets. Ichigo Office is acquiring the Ichigo Tachikawa
Building by exercising the preferential negotiation right that came with its TK equity
investment in the asset. After the acquisition, Tachikawa Holdings GK will be dissolved
and Ichigo Office’s investment will be returned.
The Ichigo Tachikawa Building is located in Tachikawa, a major city connecting central
Tokyo to the Tama area of Tokyo, where supply and demand for offices has historically
been stable. Ichigo Office will drive earnings growth of the asset via value-add capex.
With this asset acquisition, Ichigo Office’s post-transaction portfolio will be 82 officeassets, or 96.8% of the total portfolio. Ichigo Office expects to continue to grow its
specialized, mid-size office portfolio to drive further earnings growth.
The Ichigo Tachikawa Building’s tenants fully comply with the “Financial Report (YukaShoken Hokokusho)” (Japanese only) submitted on July 29, 2020.
Please refer to the May 15, 2019 release “Acquisition of TK Equity Interest in Unizo
Tachikawa Building” for additional details on the preferential negotiation right.
Please refer to Section 3 “Details of the Ichigo Tachikawa Building” immediately below
for additional details on the asset’s features and characteristics that underpinned theacquisition decision.
3. Details of the Ichigo Tachikawa Building(1) Location
Tachikawa City is located in the Tama area of Tokyo, which has rapidly developed as abusiness and retail center in suburban Tokyo due to the redevelopment of the areasurrounding Tachikawa Station and the launch of the Tama Monorail.
The building is located near Tachikawa Station on the JR Chuo Line, allowing easy
access to central Tokyo via major stations such as Shinjuku and Tokyo.
The northern side of Tachikawa Station, where the building is located, is a commercial
district with many large-size office buildings that is in high demand as a location forbranch offices and sales offices.
(2) Features
The Ichigo Tachikawa Building is a mid-size office building located within an eightminute walk from Tachikawa Station on the JR Chuo Line and a seven-minute walkfrom Tachikawa Kita Station on the Tama Toshi Monorail Line.
Each floor is sub-divisible with a standard floor plate of 145 tsubo (480m2) and isequipped with raised-access floors and individual air conditioning units. Together withits 58 parking spaces, the building caters to tenant needs in the area.
The building is currently occupied by an IT company, an insurance company, a realestate management company, and the call center of a TSE-listed company.

2(3) Building Exterior and Location

Asset Name
Legal Form of Asset
Trustee
Period of Trust Contract
Location
Property Right
Area
Land
ZoningCoverage Ratio
Floor Area Ratio
Property Right
Use
Building Structure
Total Floor Area
Date Built
Appraiser
Appraisal Value

Asset Overview
Ichigo Tachikawa Building
Trust beneficiary interest in real estate (juekiken)
Mizuho Trust & Banking Co., Ltd.
February 22, 2006 – March 31, 2025
1-21-1 Akebonocho, Tachikawa, Tokyo
Freehold
1,784.89m2(1) Retail (2) Neighborhood Commercial(1) 80% (2) 80%(1) 500% (2) 300%
Freehold
Office, retail, parking, storage
Steel Reinforced Concrete, Reinforced Concrete B3F/7F
7,642.37m2
December 14, 1992
Daiwa Real Estate Appraisal Co., Ltd.
JPY 4,000 million
November 1, 2020

Appraisal Date
Value by Direct Capitalization
JPY 4,100 million
MethodKimura Architects & Associates
Architect1
Joint Venture of Taisei Corporation and Penta-Ocean
Builder1
Construction
1
Structural Designer
Kimura Architects & Associates
1
Inspection Agency
Tachikawa City
PML (Assessor)
5.00% (Sompo Risk Management Inc.)
CollateralNone3

Lease Details (as of October 31, 2020)
Tenant Overview
Number of Tenants
Monthly Rental Income
Tenant Security Deposits
Leasable Area
Leased Area
Occupancy
Property Management
Company
Master Lease Company
Master Lease Type15
JPY 16.412 million
JPY 116.494 million
4,879.78m2
4,700.57m2
Oct 2018 Apr 2019
100%
100%

Oct 2019
96.9%

Apr 2020
96.3%

Oct 2020
96.3%

Dai-ichi Building Co., Ltd. (expected)
Ichigo Office REIT Investment Corporation (expected)
Pass-through (expected)

Special Items
1. Pursuant to Article 42, Paragraph 2 of the Building Standards Act, 11.47m2 of land on thenortheast side of the property is used as a public road.
2. A report by Earth-Appraisal Co., Ltd. indicates that although asbestos was detected in thepaint coating used for the outdoor staircase, there is no risk of the asbestos becoming
airborne during normal use given that there are no significant damages and the coating is ingood condition. Ichigo Office will record JPY 11 million of asset retirement obligations on
its balance sheet for the April 2021 fiscal period in anticipation of asbestos removal
expenses arising when the building is renovated.
3. Lease termination notifications were received from two tenants, one with leased area of
211.50m2 and effective February 28, 2021, and another with leased area of 163.21m2 andeffective May 31, 2021. Ichigo Office entered into a lease with a new tenant (leased area:179.21m2) effective December 11, 2020. Occupancy is expected to be 92.3% after the twolease terminations and the one new lease.
1

Names of the architect, builder, structural designer, and inspection agency are those as of
the building’s construction date.

4

Asset NameAppraisal Value
Appraiser
Appraisal Date
Appraisal Value
Value by Direct
Capitalization Method
IncomeForecast FullOccupancy Rental
IncomeForecast Decrease
in Rental Income
due to Vacancy
Expenses
Administrative &MaintenanceExpensesUtility Expenses
Repair Expenses
PM FeeLeasing
Brokerage Fees
Taxes
Insurance
Premiums
Other Expenses
Net Operating
Income (NOI)
Income from
Investments ofDeposits
CapitalExpenditure
Net Profit

Appraisal Details
Ichigo Tachikawa Building
JPY 4,000,000,000
Daiwa Real Estate Appraisal Co., Ltd.
November 1, 2020
AmountNote
Based on a DCF valuation and verified
JPY 4,000,000,000
using a direct capitalization valuation
JPY 4,100,000,000
JPY 253,983,792
Based on an analysis of potential rental
JPY 266,649,450 income, common area service income,parking lot income, and other income
JPY 12,665,658 Based on long-term vacancy rates
JPY 71,450,482
JPY 13,044,000 Based on actual amounts
JPY 24,798,984 Based on actual amounts
JPY 4,115,167 Based on engineering reports
Based on a new fee quote from theJPY 3,895,168
property management company
Based on tenant acquisition costs forJPY 1,342,563
similar assets
JPY 22,099,300 Based on FY2020 actual amounts
JPY 561,080 Based on insurance estimates
JPY 1,594,220 Based on actual amounts
JPY 182,533,310
JPY 1,204,522 Based on a 1.0% investment yield
JPY 11,706,500 Based on engineering reports
JPY 172,031,332
Based on transactions of similar assets
and a comprehensive assessment of the4.2%
asset’s location, its specificcharacteristics, and market trends

Cap Rate

5

Value via DCF Method

JPY 3,950,000,000

Discount Rate

Based on yields of similar real estate
assets and of Japanese financial assets,4.0%
taking into account the asset’s specificcharacteristics

Terminal Cap Rate

4.4% Based upon risk-adjusted NOI

Accounting ValueLandBuilding

JPY 3,390,000,000
74.1%
25.9%
Notes

None
Note: Appraisal NOI Yield: 4.8% (calculated by dividing NOI by Acquisition Price)
4. Seller Profile
Name
Address
RepresentativeBusiness
Paid-In Capital
Establishment Date

Relationship toIchigo Office or IIA

Tachikawa Holdings GK
2-7-1 Nihonbashi, Chuo-ku, TokyoManaging Member: Ippan Shadan Hojin Tachikawa Holdings
Manager: Shogo Kikuchi
1. Investment in trust beneficiary interests in real estate(juekiken)
2. Acquisition, holding, disposition, leasing, and managementof real estate
3. Other businesses relating to the aforementioned businesses
JPY 100,000
April 18, 2019
The seller does not have any additional capital, personnel, ortransactional relationships with Ichigo Office or IIA requiring
the disclosure under Tokyo Stock Exchange rules. In addition,
the seller is not a related party as defined in the Enforcement
Ordinance of the Investment Trust and Investment
Corporation Law or the internal rules of the AssetManagement Company.

5. Broker Profile
N/A
6. Acquisition ScheduleIchigo Office Board Resolution Date
Contract Date
Closing Date

December 14, 2020
December 14, 2020
December 18, 2020 (expected)

7. Earnings Outlook
The impact of this acquisition on Ichigo Office’s April 2021 and October 2021 fiscal
period earnings is described in today’s release, “October 2020 Earnings.”

6Reference
1. Earnings Profile of Asset Being Acquired(JPY million)
Forecast1

At Acquisition2

A. Rental Income
B. Rental Expenses(excluding depreciation)3
C. NOI (A-B)

244

239

6970175

169

D. NOI Yield4

4.6%

4.4%

E. Depreciation54343F. Post-depreciation NOI (C-E)

131

125

G. Post-depreciation NOI Yield4

3.4%

3.3%

H. Occupancy6

96.0%

96.3%

1Amounts exclude one-off factors in the year of acquisition and are calculated based on
current and future anticipated fluctuations in occupancy.
2
Shows first-year amounts used to calculate the DCF-based valuation, excluding one-off
factors in the year of acquisition.
3
Rental Expenses include incidental expenses such as service provider expenses, property,
city planning, and consumption taxes, and other fees.
4Forecast NOI Yield and NOI Yield At Acquisition are calculated by dividing theForecast NOI and NOI At Acquisition, respectively, by the Acquisition Price.
5Depreciation is as estimated by Ichigo Office.
6Occupancy is as of October 31, 2020.
2. Engineering Report Summary
Asset Name
Inspector Name
Inspection Date
Short-Term Repair Expenses1
Long-Term Repair Expenses2
Current Replacement CostIchigo Tachikawa Building
Tokio Marine & Nichido Risk Consulting Co., Ltd.
November 2020–JPY 189.860 million
JPY 2,805.400 million

1Short-Term Repair Expenses are defined as repair expenses beyond the scope ofordinary maintenance within a year from the time of inspection.
2Long-Term Repair Expenses are defined as cumulative repair expenses considerednecessary for the maintenance of the asset within twelve years from the time ofinspection.

7

3. Post-Transaction Portfolio
No.
O-02
O-03
O-04
O-05
O-06
O-07
O-08
O-09
O-10
O-11
O-12
O-14
O-15
O-16
O-17
O-18
O-19
O-20
O-21
O-22
O-23
O-24
O-26

Area1

Asset Name

O-27
O-28
O-29

Ichigo Nishisando Building
Ichigo Mita Building
Ichigo Nanpeidai Building
Ichigo Hanzomon Building
Ichigo Hijirizaka Building
Ichigo Shibuya Kamiyamacho Building
Ichigo Akasaka 5 Chome Building
Ichigo Shibakoen Building
Ichigo Ebisu Nishi Building
Ichigo Ginza 612 Building
Ichigo Uchikanda Building
Ichigo Yotsuya 4 Chome Building
Ichigo Tameike Building
Ichigo Jimbocho Building
Ichigo Hakozaki Building
Ichigo Kudan 2 Chome Building
Ichigo Kudan 3 Chome Building
Ichigo Gotanda Building
Ichigo Shin Yokohama Building
Ichigo Minami Ikebukuro Building
Ichigo Nakano North Building
Ichigo Eitai Building
Ichigo Ikejiri Building
Ichigo Nishi Ikebukuro Building
Ichigo Nishi Gotanda Building
Ichigo Kichijoji Building

O-34

Ichigo Sakae Building

O-37

Ichigo Marunouchi Building

O-38
O-39
O-42
O-46
O-47

Ichigo Toyamaeki Nishi Building
Ichigo Mirai Shinkin Building
Ichigo Takamatsu Building
Ichigo Kanda Nishikicho Building
Ichigo Akihabara North Building

O-48

Ichigo Sakaisuji Honmachi Building

O-49

Ichigo Kanda Ogawamachi Building

Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Tokyo Metro Area
Tokyo Metro Area
Tokyo Metro Area
Tokyo Metro Area
Tokyo Metro Area
Tokyo Metro Area
Central Tokyo
Tokyo Metro Area
Four Major RegionalCities
Four Major RegionalCities
Other Regional Cities
Other Regional Cities
Other Regional Cities
Central Tokyo
Central Tokyo
Four Major RegionalCities
Central Tokyo
8Acquisition
Price2(JPY million)% ofPortfolio3

3,254
2,740
1,920
1,550
1,200
1,505
735
1,100
1,917
1,773
1,140
550
580
1,820
1,150763
844
5,060
1,816
1,460
764
1,490
2,030
639
765
2,160

1.6
1.30.9
0.8
0.6
0.7
0.4
0.5
0.9
0.9
0.6
0.3
0.3
0.9
0.6
0.4
0.4
2.5
0.9
0.7
0.4
0.7
1.0
0.3
0.4
1.0

4,705

2.3

6,710

3.3

1,645
1,158
3,010
2,130
5,500

0.8
0.6
1.5
1.0
2.7

1,940

0.9

2,210

1.1

No.
O-50
O-51
O-52
O-53
O-54
O-55
O-56
O-57
O-58
O-59
O-60
O-61
O-62
O-63
O-64
O-65
O-66
O-67
O-68
O-69
O-70
O-71
O-72
O-73

Area1

Asset Name
Ichigo Hatchobori Building
Ebisu Green Glass
Ichigo Omori Building
Ichigo Takadanobaba Building
Ichigo Omiya Building
Ichigo Sagamihara Building
Ichigo Ofuna Building
Ichigo Sendai East Building
Ichigo Kumamoto Building
Ichigo Jingumae Building
Ichigo Shibuya Dogenzaka Building
Ichigo Hiroo Building
Ichigo Sasazuka Building
Ichigo Nihonbashi East Building
Ichigo Sakurabashi Building
Ichigo Shinkawa Building
Ichigo Kudan Building
Ichigo Higashi Gotanda Building
Axior Mita
Ichigo Higashi Ikebukuro Building
Koriyama Big-i (Office Section)
Ichigo Kawasaki Building
Ichigo Shibuya East Building
Ichigo Ningyocho Building

Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Tokyo Metro Area
Tokyo Metro Area
Tokyo Metro Area
Other Regional Cities
Other Regional Cities
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Central Tokyo
Tokyo Metro Area
Other Regional Cities
Tokyo Metro Area
Central Tokyo
Central Tokyo
Four Major Regional
CitiesFour Major Regional
CitiesFour Major RegionalCities
Tokyo Metro Area
Tokyo Metro Area
Central Tokyo
Tokyo Metro Area
Four Major Regional
CitiesFour Major Regional
CitiesFour Major Regional
CitiesFour Major RegionalCities

O-74 Ichigo Nishi Honmachi Building
O-75 Ichigo Hakata Building
O-76 Ichigo Nishiki First Building
O-77
O-78
O-79
O-80

Ichigo Ikenohata Building
Ichigo Ikebukuro East Building
Ichigo Motoazabu Building
Ichigo Otsuka Building

O-81 Ichigo Nagoya Building
O-82 Ichigo Fushimi Building
O-83 Ichigo Nishiki Building
O-84 Ichigo Minami Morimachi Building
9

Acquisition
Price2(JPY million)
1,905
5,900
3,850

% ofPortfolio3

1,580
3,430
1,174
2,000
1,840
1,450
7,200
3,650
3,960
4,780
4,700
2,500
2,360
3,190
3,660
1,800
4,570
1,660
1,750
1,350
1,450

0.92.9
1.9
0.8
1.7
0.6
1.0
0.9
0.7
3.5
1.8
1.9
2.3
2.3
1.2
1.1
1.5
1.8
0.9
2.2
0.8
0.8
0.7
0.7

2,190

1.1

1,380

0.7

2,000

1.0

5,130
3,010
1,890
2,740

2.5
1.5
0.9
1.3

3,420

1.7

2,340

1.1

1,330

0.6

1,040

0.5

No.
O-85
O-86
O-87
O-88
O-89
O-90
O-91
O-92
O-93
O-94
O-95
O-96
Z-09
Z-10
Z-11
Z-14

Area1

Asset Name
Ichigo Shibuya Udagawacho Building
Win Gotanda Building
Ichigo Hongo Building
Oimachi Center Building
Win Gotanda Building 2
MIF Building

Central Tokyo
Central Tokyo
Tokyo Metro Area
Central Tokyo
Central Tokyo
Central Tokyo
Four Major Regional
Ichigo Uchi Honmachi Building
CitiesIchigo Minami Otsuka Building
Tokyo Metro Area
Ichigo Nogizaka Building
Central Tokyo
Four Major Regional
Ichigo Hakata East Building
CitiesIchigo Nakameguro Building
Tokyo Metro Area
Ichigo Tachikawa Building
Tokyo Metro Area
Subtotal - Office (82 Assets)
Konami Sports Club Izumi Fuchu
Other Regional Cities
Ichigo Shibuya Bunkamura Dori Building
Central Tokyo
Twicere Yokohama Isogo (Retail Section)
Tokyo Metro Area
Ichigo Kamata Building
Tokyo Metro Area
Subtotal - Other (4 Assets)
Total (86 Assets)

1Acquisition
Price2(JPY million)% ofPortfolio3

3,500
3,100
2,300
1,680
3,300
2,200

1.7
1.5
1.1
0.8
1.6
1.1

1,900

0.9

2,780
3,315

1.3
1.6

2,250

1.1

1,495
3,830
199,562
1,210
2,400
1,620

0.7
1.9
96.8

1,400
6,630

0.6
1.2
0.8
0.7
3.2

206,192

100.0

Central Tokyo refers to Chiyoda, Minato, Chuo, Shinjuku, Shibuya, and Shinagawa Wards. Tokyo MetroArea refers to Tokyo (excluding the six wards above), Kanagawa, Chiba, and Saitama Prefectures. FourMajor Regional Cities refers to Osaka, Nagoya, Fukuoka, and Sapporo.
2Acquisition Price excludes incidental expenses such as consumption taxes and other fees.
3% of Portfolio is based upon acquisition price.

10