June 22, 2021
To All Concerned Parties
Issuer of Real Estate Investment Trust Securities:
Nippon Accommodations Fund Inc.
Takashi Ikeda, Executive Director(TSE Code: 3226)
Investment Trust Management Company:
Mitsui Fudosan Accommodations
Fund Management Co., Ltd.
Tateyuki Ikura, President and CEO
Inquiries: Tetsuji Kawakami, CFO and Director(TEL: +81-3-3246-3677)

Notification Concerning Acquisition of Domestic Real Estate Properties(Park Axis Kikukawa Station Gate and Two Other Properties)
This is a notification that Mitsui Fudosan Accommodations Fund Management Co., Ltd., an investment trust
management company, which has been commissioned by Nippon Accommodations Fund Inc. (“NAF”) to manage
its assets, decided on the acquisition of real estate properties in Japan as shown below.
1. Reason for acquisition
Based on the provisions for investments and policies on asset management provided in the Articles ofIncorporation, the decision to acquire the following properties was made to ensure the steady growth of assets
under management, and for the diversification and further enhancement of the investment portfolio.

2. Overview of acquisitions
Name of property to be acquired

Property to beacquired

Plannedacquisition price(Note 1)(Thousands of yen)Appraised value(Note 2)(Thousands of yen)

Property 1

Park Axis Kikukawa Station Gate

Real estate

3,200,000

3,560,000

Property 2

Park Axis Kiba Canal West

Real estate

4,660,000

5,090,000

Property 3

Park Axis Kiba Canal East

Real estate

1,830,000

2,050,000

9,690,000

10,700,000

Total(1) Date of conclusion of sale contract

June 22, 2021

(2) Planned date of handoverJune 29, 2021

(3) Seller

Mitsui Fudosan Residential Co., Ltd.

(4) Acquisition fundBorrowings and own funds(5) Method of payment

Full payment at the time of handover(Note 1)

“Planned acquisition price” denotes the trading value (exclusive of miscellaneous expenses for acquisition, fixed property
taxes, urban planning taxes, consumption taxes, and local consumption taxes) specified in the contract for the sale ofreal estate with condition precedent for the properties to be acquired.

(Note 2)

“Appraised value” is based on the amount mentioned in the real estate appraisal reports (date of value appraisal: May
31, 2021) prepared by Daiwa Real Estate Appraisal Co., Ltd. for the properties to be acquired.

1

3. Description of the properties to be acquired(1) Outline of the properties to be acquired(i) Property 1: Park Axis Kikukawa Station Gate
Name of property to be acquired
Type of property to be acquired
Appraisal company
Appraised value (Note 1)
Date of value appraisal (Note 1)
Location
Residence indication
Building-to-land ratio(Note 2)
Floor-area ratio(Note 2)Land
ZoningSite area (Note 3)
Ownership form
Completion date
(Note 4)Structure / number ofstories (Note 5)
Building

Uses (Note 5)

Gross floor area
(Note 5)
Ownership form
Rentable units
Rentable area
Existence of security interests

Special affairs (Note 6)

Special features of the property

Park Axis Kikukawa Station Gate
Real estate
Daiwa Real Estate Appraisal Co., Ltd.
¥3,560,000 thousand
May 31, 2021
1-3, Kikukawa 3-chome, Sumida-ku, Tokyo
80%
500%
Commercial zone
773.10 m2
Proprietorship
March 29, 2013
Flat-roofed reinforced concrete structure / 11 stories
Apartment building, parking, bicycle parking, garage, garbage depot,
storage
4,592.47 m2
Proprietorship
107
3,411.32 m2
NonePart of the land is located within the city planning road (Ring Road No.
3). There is a possibility the building will become a non-conforming
building due to the expropriation of land if the project is determined in
the future.
The transaction of the property has the following (1) or (2) as acondition precedent with regard to the filing dated June 7, 2021, basedon Article 4, Paragraph 1 of the Act on Advancement of Expansion of
Public Lands (Act No. 66 of 1972, including subsequent amendments)
for the sale of the property by the seller: (1) arrival of June 28, 2021,
without the seller receiving from Sumida Ward a notice on holding a
discussion about the purchase specified in Article 6, Paragraph 1 ofthe said Act; (2) the seller receiving from Sumida Ward a noticespecified in Article 6, Paragraph 3 of the said Act.
Although soil with lead exceeding the standard has been confirmed atpart of the land, measures to prevent the spread of contamination havebeen implemented. In addition, it has been reported by a third-party
institution that risk of health damage is low because the surface of theland has been covered and underground water is not used for drinking.
The property is approximately a 3-minute walk from Kikukawa Stationon the Toei Shinjuku Subway Line, boasting proximity to a station. The
accessibility to central Tokyo and major areas in Tokyo is also
excellent.
It offers excellent convenience in daily life as there are facilities for living
convenience in front of the station.
Demand from singles and DINKS households that place importance on
living convenience can be expected.

2

Details of
leasing(Note 7)

Total number oftenants
Rentable units

107

Rented units

104

Rentable area

3,411.32 m2

Rented area

3,319.77 m2

Occupancy rate
Deposit /Security deposit
Monthly rental
revenue

97.3%

1¥23,269 thousand¥13,891 thousand

3

(ii) Property 2: Park Axis Kiba Canal West
Name of property to be acquired
Type of property to be acquired
Appraisal company
Appraised value (Note 1)
Date of value appraisal (Note 1)
Location
Residence indication
Building-to-land ratio(Note 2)
Floor-area ratio(Note 2)Land
ZoningSite area (Note 3)
Ownership form
Completion date
(Note 4)Structure / number ofstories (Note 5)
Uses (Note 5)
Building
Gross floor area
(Note 5)
Ownership form
Rentable units
Rentable area
Existence of security interests

Special affairs (Note 6)

Special features of the property

Total number oftenants
Rentable units
Details of
leasing(Note 7)Park Axis Kiba Canal West
Real estate
Daiwa Real Estate Appraisal Co., Ltd.
¥5,090,000 thousand
May 31, 2021
4-35, Shiohama 2-chome, Koto-ku, Tokyo
60%
300%
Quasi-industrial district
1,539.32 m2
Proprietorship
October 17, 2018
Flat-roofed reinforced concrete structure / 12 stories
Apartment building, store, bicycle parking
5,438.12 m2
Proprietorship146 residential, 1 retail, etc.
4,430.50 m2
None
Although soil with lead exceeding the standard has been confirmed atpart of the land, measures to prevent the spread of contamination havebeen implemented. In addition, it has been reported by a third-party
institution that the risk of health damage is low because the surface ofthe land has been covered and underground water is not used for
drinking.
When selling the property, it is required to notify the lessee of the store
section in advance and hold a discussion about the sale.
The property is approximately an 11-minute walk from Kiba Station on
the Tokyo Metro Tozai Line. With “Shiozakiso-mae” bus stop of Toei
Bus located close to the property, access to “Shiomieki-mae” bus stopis also available. Furthermore, the Tokyo Metro Tozai Line provides
excellent access to central Tokyo.
Because there are various retail stores, restaurants and such in thearea surrounding the nearest station and the Toyosu area is withinwalking distance, it offers convenience in daily life.
Demand from singles and DINKS households that place importance on
living convenience can be expected.
1
146 residential, 1 retail, etc.

Rented units

135 residential, 1 retail, etc.

Rentable area

4,430.50 m2

Rented area

4,092.22 m2

Occupancy rate
Deposit /Security deposit
Monthly rental
revenue

92.4%¥29,745 thousand¥18,252 thousand4

(iii) Property 3: Park Axis Kiba Canal East
Name of property to be acquired
Type of property to be acquired
Appraisal company
Appraised value (Note 1)
Date of value appraisal (Note 1)
Location
Residence indication
Building-to-land ratio(Note 2)
Floor-area ratio(Note 2)Land
ZoningSite area (Note 3)
Ownership form
Completion date
(Note 4)Structure / number ofstories (Note 5)
Uses (Note 5)
Building
Gross floor area
(Note 5)
Ownership form
Rentable units
Rentable area
Existence of security interests

Special affairs (Note 6)

Special features of the property

Total number oftenants
Rentable units
Details of
leasing(Note 7)Park Axis Kiba Canal East
Real estate
Daiwa Real Estate Appraisal Co., Ltd.
¥2,050,000 thousand
May 31, 2021
4-33, Shiohama 2-chome, Koto-ku, Tokyo
60%
300%
Quasi-industrial district
636.40 m2
Proprietorship
February 21, 2020
Flat-roofed reinforced concrete structure / 9 stories
Apartment building, store, bicycle parking
2,257.03 m2
Proprietorship
63 residential, 1 retail, etc.
1,830.46 m2
None
Although soil with lead exceeding the standard has been confirmed atpart of the land, measures to prevent the spread of contamination havebeen implemented. In addition, it has been reported by a third-party
institution that the risk of health damage is low because the surface ofthe land has been covered and underground water is not used for
drinking.
The property is approximately an 11-minute walk from Kiba Station on
the Tokyo Metro Tozai Line. With “Shiozakiso-mae” bus stop of Toei
Bus located close to the property, access to “Shiomieki-mae” bus stopis also available. Furthermore, the Tokyo Metro Tozai Line provides
excellent access to central Tokyo.
Because there are various retail stores, restaurants and such in thearea surrounding the nearest station and the Toyosu area is withinwalking distance, it offers convenience in daily life.
Demand from singles and DINKS households that place importance on
living convenience can be expected.

1
63 residential, 1 retail, etc.

Rented units

61 residential, 1 retail, etc.

Rentable area

1,830.46 m2

Rented area

1,778.49 m2

Occupancy rate
Deposit /Security deposit
Monthly rental
revenue

97.2%¥13,659 thousand¥8,081 thousand

5

(Note 1) “Appraised value” and “date of value appraisal” are based on the description in the real estate appraisal reports preparedby Daiwa Real Estate Appraisal Co., Ltd. for the properties to be acquired.
(Note 2) “Building-to-land ratio” is the ratio of the building’s construction area to the site area as stipulated in Article 53 of the BuildingStandards Act, and the figure stipulated by city planning in accordance with zoning, etc. is indicated. “Floor-area ratio” is theratio of the building’s gross floor area to the site area as stipulated in Article 52 of the Building Standards Act, and the figure
stipulated by city planning in accordance with zoning, etc. is indicated.
(Note 3) “Site area” denotes the land area included in the register.
(Note 4) “Completion date” of the building denotes the date included in the register.
(Note 5) “Structure / number of stories,” “uses,” and “gross floor area” are based on the description in the register.
(Note 6) “Special affairs” include issues considered to be important by NAF as of today, with consideration of influence on the rights,
uses, and appraisal values as well as profits of the properties that NAF plans to acquire.
(Note 7) Explanation on “details of leasing”(i)A master lease agreement has been concluded with Mitsui Fudosan Residential Lease Co., Ltd. as the master lease
company, and thus the “total number of tenants” is entered as 1, indicating the number of such master lease companies.

(ii) “Rentable units” denotes the number of units that can be rented within the property that NAF plans to acquire.
(iii) “Rented units” and “rented area” denote figures as of May 31, 2021, based on the report received from the seller.
(iv) “Rentable area” denotes the total area of the building that can be rented within the property that NAF plans to acquire.
(v) “Occupancy rate” denotes the ratio of the “rented area” against the “rentable area” and the figures are rounded to one
decimal place.
(vi) “Monthly rental revenue” and “Deposit / Security deposit” are the total amounts of both the monthly rent (includingcommon service fees and excluding usage fees of attached facilities such as parking lot and trunk room) and deposit /security deposit indicated in the lease agreement concluded between the master lease company and end tenants as of
May 31, 2021. Figures less than ¥1 thousand are rounded down and consumption tax is excluded from those figures.

6

(2) Outline of investigations into the state of the building, etc.
Property 2
Property 3
Property 1
Park Axis Kikukawa
Park Axis Kiba Canal
Park Axis Kiba Canal
Name of properties to be acquired
Station Gate
West
East
Consigned
investigating
Tokio Marine & Nichido Risk Consulting Co., Ltd.
company
Investigation
June 8, 2021
June 8, 2021
June 8, 2021
report date
Urgent repair
–
–
–
cost
Investigations
Short-term repair
into the state
–
–
–
cost
of building
Repair andrenewal costs¥69,458¥35,589¥12,954
expected to be
thousandthousandthousandnecessary within
12 years
Replacement¥1,092,700¥1,283,800¥540,400
value
thousandthousandthousandConsigned
investigating
Tokio Marine & Nichido Risk Consulting Co., Ltd.
company
Earthquake
Investigation
June 8, 2021
June 8, 2021
June 8, 2021
risk diagnosis
report date
PML value
5.7%
6.7%
7.0%
(Note)(Note)The report on earthquake risk diagnosis only states the views of the consigned investigating company and does not provide
any guarantee of their appropriateness or accuracy for its contents. PML (Probable Maximum Loss) value represents therate of probable maximum loss to be caused by earthquakes. In this case, it means the extent of damage to be caused by
one of the biggest earthquakes anticipated to happen within the expected duration of service (10% chance of a big
earthquake happening once every 50 years = a big earthquake which happens once every 475 years) represented by therate (%) of the estimated cost of restoration from the damage to the replacement cost.

74. Outline of Seller
Name
Location
Representative

Mitsui Fudosan Residential Co., Ltd.
2-1, Nihonbashi-Muromachi 3-chome, Chuo-ku, Tokyo
Toru Kamura, President & CEO

Description of principal
operations

Medium and high-rise housing, detached housing, rental housing, overseas
business, urban redevelopment, reconstruction of apartments, commissioned
sales, and senior residence businesses

Capital¥40,000 million
Date of establishment
December 26, 2005
Net assets¥142,346 million(As of March 31, 2020)
Total assets¥897,363 million(As of March 31, 2020)
Shareholding
Major stockholders andStockholder nameratio
shareholding ratio(As of March 31, 2020)
Mitsui Fudosan Co., Ltd.
100.0%
Relationship between NAF or the investment trust management company, and the seller
The seller holds 3.09% of total NAF investment units issued as of February 28,
2021. Also, the seller is a subsidiary of Mitsui Fudosan Co., Ltd., which is the
Capital relationships
parent company of the investment trust management company.
There are no personal relationships between NAF or the investment trust
Personal relationships
management company and the seller.
During the period ended February 28, 2021, NAF acquired 1 property from theseller. Other than this, as of February 28, 2021, there are no businessBusiness relationships
relationships to report between NAF or the investment trust managementcompany and the seller.
The seller does not fall under the category of related parties of NAF. Also, theseller is a subsidiary (100%) of Mitsui Fudosan Co., Ltd., which is the parent
Applicability to relatedcompany of the investment trust management company, and therefore falls
parties
under the category of related parties thereof.

85. Situation of the acquirer of the property
Situation of theproperty owner
Name

Property 1:
Park Axis Kikukawa Station Gate

Relationship witha special related
party

Property 2:
Park Axis Kiba Canal West
Property 3:
Park Axis Kiba Canal East

Acquisition history,reason, etc.

Acquisition price(including othercosts)
Acquisition time

Former owner, etc.
Mitsui Fudosan ResidentialCo., Ltd. (Note)
Wholly owned subsidiary of
Mitsui Fudosan Co., Ltd.,
which is the parent
company of the investment
trust managementcompany
Property 1:
Property developed by
Mitsui Fudosan Co., Ltd.
(Note)

Owner before theformer owner, etc.
None

―

―
Properties 2 and 3:
Properties developed by
Mitsui Fudosan ResidentialCo., Ltd.
―

―

―

―

(Note) Mitsui Fudosan Co., Ltd.’s rights and obligations in the rental housing business were succeeded by Mitsui Fudosan Residential Co.,
Ltd. as of October 1, 2015, through a company split.

6. Outlines of brokerage
Not applicable.

7. Transactions with related parties and the like
Since Mitsui Fudosan Residential Co., Ltd., which is the seller, corresponds to related parties and the like(see Note), the real estate sales contract with condition precedent has been carried out through deliberation
and approval by the compliance committee and deliberation and decision by the investment committee of theinvestment trust management company, in accordance with NAF’s self-established rules on asset management
relevant to transactions with related parties and the like.
Mitsui Fudosan Residential Lease Co., Ltd., which will be the master lease company and property
management company, corresponds to related parties and the like (see Note). Therefore, the master lease
contract and property management contract have been carried out through deliberation and approval by thecompliance committee and deliberation and decision by the investment committee of the investment trust
management company, in accordance with NAF’s self-established rules on asset management relevant totransactions with related parties and the like.
(Note)“Related parties and the like” means related parties and the like of the investment trust management company which has
concluded an asset management contract with NAF, as determined in Article 123 of the Order for Enforcement of the Act on
Investment Trust and Investment Corporation.

98. Earthquake resistance matters
The properties to be acquired have received a structural calculation conformity judgment pursuant to the
Building Standards Act as revised by the Act No. 92 of 2006.
In addition, NAF always entrusts earthquake risk diagnosis to the third-party investigating company to review
drawings and the like using structural design drawings, structural calculation sheets, etc., during the course ofdue diligence upon acquisition of properties, besides building certification investigations performed by aninspection and certification agency.
9. Outlook for management after acquisition of the properties
The impact of the acquisition on NAF’s financial results for the periods ending August 31, 2021 (31st Period:
March 1, 2021, to August 31, 2021) and February 28, 2022 (32nd Period: September 1, 2021, to February 28,2022) will be minor, and there will be no change to financial results forecast for the periods.

1010. Summary of appraisal report
Property 1: Park Axis Kikukawa Station Gate
Appraised value
Appraisal company
Date of value appraisal
Item

Value of earnings

Value calculated by the direct capitalization
method [(4)÷(5)](1) Operating revenues [(a)−(b)](a) Potential gross revenue(b) Vacancy loss, etc.
(2) Operating expenses[(c)+(d)+(e)+(f)+(g)+(h)+(i)+(j)](c) Maintenance expenses(d) Utilities expenses

Details

3,560,000

3,640,000
170,223
179,919

9,696

5,574
1,362

3,352

(f) Property management fees

5,848(g) Tenant soliciting fees, etc.

4,826(h) Taxes and public dues

8,513(i) Property insurance fees289(3) Net operating income [(1)−(2)](k) Earnings from temporary
deposits(l) Capital expenditures(4) Net income [(3)+(k)−(l)]Appraised after taking into account medium- to longterm competitiveness based on levels of new rent atsimilar real estate and trends of such.
Appraised by considering competitiveness of the subject
real estate, etc. based on actual vacancy rates andstandard vacancy rates of similar real estate.

31,389(e) Repair expenses(j) Other expenses¥3,560,000 thousand
Daiwa Real Estate Appraisal Co., Ltd.
May 31, 2021
(Unit: Thousands of yen)
Summary, etc.
Appraised by judging the value of earnings found by thediscounted cash flow method in which the value isderived by specifying future net income fluctuations to
be more convincing and also verifying with the value of
earnings found by the direct capitalization method.

1,623

Posted based on the planned amounts in contract.
Posted based on the actual amounts of past fiscal years.
Posted assuming the 12-year-period average repair
expenses stated in the engineering report to beappropriate. Posted maintenance expenses for rentalrooms arising upon move-outs of lessees by considering
the turnover rate, etc. after making reference to theactual amounts of past fiscal years and the levels at
similar real estate.
Appraised based on making reference to levels at
similar real estate.
Appraised based on levels at similar real estate, making
reference to actual amounts of past fiscal years.
Posted by appraising based on actual amounts after
considering burden levels, land price trends andadjustments for age.
Posted based on the estimated amount.
Appraised and posted other one-off management
expenses, miscellaneous expenses, etc. by making
reference to the actual amounts of past fiscal years.
Posted neighborhood association fees, etc. based on
the actual amounts.

138,833

125

4,412
134,546

11

Posted the amount obtained when the expected amountof deposits received, etc. is multiplied by the investment
yield appraised by comprehensively taking into accountthe viewpoints of both management aspects andprocurement aspects.
Posted assuming the 12-year-period average renewal
cost stated in the engineering report to be appropriate.

Item(5) Cap rate

Value calculated by discounted cash flow
methodDetails (Note)

3.7%

3,530,000

Discount rate

3.5%

Terminal cap rate

3.9%

Cost method value
Land ratio
Building ratio

Summary, etc.
Appraised by taking the cap rate for similar uses locatedin the area with the lowest risk as a standard andadding/subtracting the spread attributable to the subject
real estate’s various conditions, level of current rent
against market rent and other conditions, and by making
reference to the cap rate for the same supply-demandarea, etc.

Appraised by making reference to interviews withinvestors, etc., after using a combination of the methodof deriving by comparison with similar real estatetransactions and the method of deriving by factoring theindividual characteristics of the real estate into the yieldof financial assets.
Appraised after comprehensively taking into accountfuture trends of investment yield, risk of the subject realestate as an investment target, general projection of
future economic growth rates, real estate price trends,
etc., making reference to the market-derived cap rate ofsimilar transactions.

2,340,000
62.4%
37.6%

Other items considered by the appraisal
company in making the appraisal－

12Property 2: Park Axis Kiba Canal West
Appraised value
Appraisal company
Date of value appraisal
Item

Value of earnings

Value calculated by the direct capitalization
method [(4)÷(5)](1) Operating revenues [(a)−(b)]Details

5,090,000

5,210,000
234,677(a) Potential gross revenue

246,662(b) Vacancy loss, etc.

11,985(2) Operating expenses[(c)+(d)+(e)+(f)+(g)+(h)+(i)+(j)](c) Maintenance expenses(d) Utilities expenses

4,857
1,930

2,908

(f) Property management fees

8,073(g) Tenant soliciting fees, etc.

6,741(h) Taxes and public dues

12,588(i) Property insurance fees

331(3) Net operating income [(1)−(2)](k) Earnings from temporary
deposits(l) Capital expenditures(4) Net income [(3)+(k)−(l)]Appraised after taking into account medium- to longterm competitiveness based on levels of new rent atsimilar real estate and trends of such.
Appraised by considering competitiveness of the subject
real estate, etc. based on actual vacancy rates andstandard vacancy rates of similar real estate.

38,558(e) Repair expenses(j) Other expenses¥5,090,000 thousand
Daiwa Real Estate Appraisal Co., Ltd.
May 31, 2021
(Unit: Thousands of yen)
Summary, etc.
Appraised by judging the value of earnings found by thediscounted cash flow method in which the value isderived by specifying future net income fluctuations to
be more convincing and also verifying with the value of
earnings found by the direct capitalization method.

1,126

Posted based on the planned amounts in contract.
Posted based on the actual amounts of past fiscal years.
Posted assuming the annual average repair expenses
stated in the engineering report to be appropriate.
Posted maintenance expenses for rental rooms arising
upon move-outs of lessees by considering the turnoverrate, etc. after making reference to the actual amountsof past fiscal years and the levels at similar real estate.
Appraised based on making reference to levels at
similar real estate.
Appraised based on levels at similar real estate, making
reference to actual amounts of past fiscal years.
Posted by appraising based on actual amounts after
considering burden levels, land price trends andadjustments for age.
Posted based on the estimated amount.
Appraised and posted maintenance expenses andreserve for other miscellaneous expenses by making
reference to the actual amounts of past fiscal years.

196,119

227

3,594
192,752

13

Posted the amount obtained when the expected amountof deposits received, etc. is multiplied by the investment
yield appraised by comprehensively taking into accountthe viewpoints of both management aspects andprocurement aspects.
Posted by making reference to the renewal cost in theengineering report and levels of renewal cost at similar
real estate.

Item(5) Cap rate

Value calculated by discounted cash flow
methodDetails (Note)

3.7%

5,040,000

Discount rate

3.5%

Terminal cap rate

3.9%

Cost method value
Land ratio
Building ratio

Summary, etc.
Appraised by taking the cap rate for similar uses locatedin the area with the lowest risk as a standard andadding/subtracting the spread attributable to the subject
real estate’s various conditions, level of current rent
against market rent and other conditions, and by making
reference to the cap rate for the same supply-demandarea, etc.

Appraised by making reference to interviews withinvestors, etc., after using a combination of the methodof deriving by comparison with similar real estatetransactions and the method of deriving by factoring theindividual characteristics of the real estate into the yieldof financial assets.
Appraised after comprehensively taking into accountfuture trends of investment yield, risk of the subject realestate as an investment target, general projection of
future economic growth rates, real estate price trends,
etc., making reference to the market-derived cap rate ofsimilar transactions.

3,650,000
63.9%
36.1%

Other items considered by the appraisal
company in making the appraisal－

14

Property 3: Park Axis Kiba Canal East
Appraised value
Appraisal company
Date of value appraisal
Item

Value of earnings

Value calculated by the direct capitalization
method [(4)÷(5)](1) Operating revenues [(a)−(b)](a) Potential gross revenue(b) Vacancy loss, etc.
(2) Operating expenses[(c)+(d)+(e)+(f)+(g)+(h)+(i)+(j)](c) Maintenance expenses(d) Utilities expenses

Details

2,050,000

2,100,000
98,111
103,208

5,096

4,164
1,129

1,203

(f) Property management fees

3,372(g) Tenant soliciting fees, etc.

2,902(h) Taxes and public dues

5,382(i) Property insurance fees

156(j) Other expenses

531(4) Net income [(3)+(k)−(l)]Posted based on the planned amounts in contract.
Posted based on the actual amounts of past fiscal years.
Posted repair expenses by making reference to therepair cost in the engineering report and levels of repair
expenses at similar real estate. Appraised and posted
maintenance expenses for rental rooms arising upon
move-outs of lessees by considering the turnover rate,
etc. after making reference to the actual amounts of pastfiscal years and the levels at similar real estate.
Appraised based on making reference to levels at
similar real estate.
Appraised based on levels at similar real estate, making
reference to actual amounts of past fiscal years.
Posted by appraising based on actual amounts after
considering burden levels, land price trends andadjustments for age.
Posted based on the estimated amount.
Appraised and posted maintenance expenses andreserve for other miscellaneous expenses by making
reference to the actual amounts of past fiscal years.

79,268(k) Earnings from temporary
deposits(l) Capital expenditures

Appraised after taking into account medium- to longterm competitiveness based on levels of new rent atsimilar real estate and trends of such.
Appraised by considering competitiveness of the subject
real estate, etc. based on actual vacancy rates andstandard vacancy rates of similar real estate.

18,843(e) Repair expenses(3) Net operating income [(1)−(2)]¥2,050,000 thousand
Daiwa Real Estate Appraisal Co., Ltd.
May 31, 2021
(Unit: Thousands of yen)
Summary, etc.
Appraised by judging the value of earnings found by thediscounted cash flow method in which the value isderived by specifying future net income fluctuations to
be more convincing and also verifying with the value of
earnings found by the direct capitalization method.

89

1,513
77,84515

Posted the amount obtained when the expected amountof deposits received, etc. is multiplied by the investment
yield appraised by comprehensively taking into accountthe viewpoints of both management aspects andprocurement aspects.
Posted by making reference to the renewal cost in theengineering report and levels of renewal cost at similar
real estate.

Item(5) Cap rate

Value calculated by discounted cash flow
method3.7%

2,030,000

Discount rate

3.5%

Terminal cap rate

3.9%

Cost method value
Land ratio
Building ratio

Summary, etc.
Appraised by taking the cap rate for similar uses locatedin the area with the lowest risk as a standard andadding/subtracting the spread attributable to the subject
real estate’s various conditions, level of current rent
against market rent and other conditions, and by making
reference to the cap rate for the same supply-demandarea, etc.

Appraised by making reference to interviews withinvestors, etc., after using a combination of the methodof deriving by comparison with similar real estatetransactions and the method of deriving by factoring theindividual characteristics of the real estate into the yieldof financial assets.
Appraised after comprehensively taking into accountfuture trends of investment yield, risk of the subject realestate as an investment target, general projection of
future economic growth rates, real estate price trends,
etc., making reference to the market-derived cap rate ofsimilar transactions.

1,520,000
60.6%
39.4%

Other items considered by the appraisal
company in making the appraisal－

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＜Attached Documents＞
1.

Portfolio list after the purchase of properties to be acquired is completed (on a planned acquisition price basis)

2.

Photos of the properties to be acquired and map of the area

NAF’s website: https://www.naf-r.jp/english/<Caution> This document is a press release intended for general publication regarding NAF's acquisition of real estate properties and is notfor purposes of soliciting investment. When investing, we ask that investors exercise their own judgment taking full responsibility after having
read carefully the new investment unit issuance and secondary offering prospectus, or any corrections thereof (if made), prepared by NAF.
17

＜Attached Document 1＞
Portfolio list after the purchase of properties to be acquired is completed (on a planned acquisition price basis)

Total Planned Acquisition Price¥337,930 million

Number of Investment Properties

134 properties

Total Rentable Units (including retail units)

13,275 units

Proportion of Investment by Asset
Planned Acquisition Price

Portfolio Share(Note 1)

(Note 2)

Rental Apartments¥320,231 million

94.8%

Hospitality Facilities¥17,699 million

5.2%¥337,930 million

100.0%

Grand Total
Proportion of “Rental Apartments” by Area

Planned Acquisition Price

Portfolio Share(Note 1)

(Note 3)

Tokyo 23 Wards¥283,250 million

88.5%

Greater Tokyo (Note 4)¥14,426 million

4.5%

Other Major Cities (Note 5)¥22,555 million

7.0%¥320,231 million

100.0%

Total of “Rental Apartments”(Note 1) “Planned Acquisition Price” does not include anticipated acquisition expenses, fixed property taxes, urban
planning taxes, consumption taxes or local consumption taxes.
(Note 2) The figure indicates the percentage of asset category to the total (planned) acquisition price.
(Note 3) The figure indicates the percentage of Rental Apartments by area to the total (planned) acquisition price.
(Note 4) “Greater Tokyo” indicates Tokyo metropolis (excluding Tokyo 23 wards), and the 3 prefectures of Kanagawa, Saitama andChiba.
(Note 5) “Other major cities” indicates major cities across Japan and their surrounding areas, excluding the Tokyo area.
(Note 6) Please refer to NAF’s website for the latest portfolio list:
https://www.naf-r.jp/portfolio/5-1.html<Caution> This document is a press release intended for general publication regarding NAF's acquisition of real estate properties and is notfor purposes of soliciting investment. When investing, we ask that investors exercise their own judgment taking full responsibility after having
read carefully the new investment unit issuance and secondary offering prospectus, or any corrections thereof (if made), prepared by NAF.
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＜Attached Document 2＞
Photo of the properties to be acquired and map of the area
Property 1: Park Axis Kikukawa Station Gate

Kinshicho Station

Kikukawa Station<Caution> This document is a press release intended for general publication regarding NAF's acquisition of real estate properties and is notfor purposes of soliciting investment. When investing, we ask that investors exercise their own judgment taking full responsibility after having
read carefully the new investment unit issuance and secondary offering prospectus, or any corrections thereof (if made), prepared by NAF.
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Property 2: Park Axis Kiba Canal West
Property 3: Park Axis Kiba Canal East

（Left： Park Axis Kiba Canal West Right：Park Axis Kiba Canal East）

Keiyo Line
Shiomi Station Station<Caution> This document is a press release intended for general publication regarding NAF's acquisition of real estate properties and is notfor purposes of soliciting investment. When investing, we ask that investors exercise their own judgment taking full responsibility after having
read carefully the new investment unit issuance and secondary offering prospectus, or any corrections thereof (if made), prepared by NAF.
20