Creating peace of mind through honest and committed management.

December 16, 2013

FINANCIAL REPORT FOR
THE FISCAL PERIOD ENDING OCTOBER 2013
(May 1, 2013 – October 31, 2013)
Ichigo Real Estate Investment Corporation (“Ichigo REIT,” Representative: Yoshihiro Takatsuka, Executive
Director, www.ichigo-reit.co.jp/english) is listed on the Tokyo Stock Exchange with the securities code 8975.
Asset Management Company: Ichigo Real Estate Investment Advisors Co., Ltd.
Representative:
Wataru Orii, President & Representative Statutory Executive OfficerInquiries:
Masanori Kubota, Statutory Executive Officer (Finance, Accounting)Tel. +81-3-3502-4891
Submission Date for Securities Report:
January 27, 2014 (expected)
Start Date for Dividend Payments:
January 22, 2014 (expected)
Supplement Material to Financial and Business Results: Yes
Financial and Business Results Briefing: Yes (for institutional investors and analysts)
1. Financial Results for the Fiscal Period Ending October 2013
(Monetary figures are rounded down to the nearest million yen)

(1) Earnings(million yen; period-on-period change)

Fiscal PeriodEnding October 2013
Fiscal PeriodEnding April 2013Fiscal PeriodEnding October 2013
Fiscal PeriodEnding April 2013

OperatingRevenue

ChangeOperating
IncomeChangeOrdinary
IncomeChangeNet
IncomeChange

4,572

10.3%

2,293

12.6%

1,490

229.8%

1,489

230.1%

4,147(4.0%)

2,036

9.1%

451

(31.9%)

451―Net Income per Share(yen)Ratio of Net Income
to Equity

Ratio of Ordinary
Incometo Total Assets

Ratio of Ordinary
Incometo Operating Revenue

1,619

2.8%

1.3%

32.6%

535

0.9%

0.4%

10.9%

(Note) Net income per share is calculated by dividing net income by the weighted average number of shares.
(2) Dividends
Dividend perShareTotalDividends

Dividend per Sharein Excess ofEarnings

Total Dividends inExcess of Earnings

PayoutRatio

Ratio ofDividends toNet Assets(yen)(million yen)

(yen)(million yen)

(%)

(%)

1,537

1,433

00

96.2

2.6

1,494

1,259

00

279.0

2.5

(not including
dividends in excessof earnings)

Fiscal PeriodEnding October 2013
Fiscal PeriodEnding April 2013

(Note 1) The April 2013 dividend includes a dividend reserve reversal of 808 million yen and differs from Net
Income.
(Note 2) The October 2013 dividend reflects a 55 million yen dividend reserve deduction and differs from Net
Income.
(Note 3) The Payout Ratio is rounded down to one decimal. The October 2013 payout ratio reflects the newshare issuance and is calculated as follows: Payout Ratio = Total Dividends / Net Income x 100

(3) Assets and Equity

Fiscal PeriodEnding October 2013
Fiscal PeriodEnding April 2013

Total Assets(million yen)

Net Assets(million yen)

Equity Ratio(%)

Net Assets per Share(yen)121,924

55,97445.9

60,005

112,83050,312

44.6

59,695

Cash Flow fromOperating Activities

Cash Flow from
Investment Activities

Cash Flow from
Financing Activities(million yen)(million yen)(million yen)

Cash and Cash
Equivalents at End of thePeriod(million yen)

2,866

(8,679)

7,203

9,676

1,693(341)(2,389)8,285(4) Cash Flow

Fiscal PeriodEnding October 2013
Fiscal PeriodEnding April 2013

2. Earnings Forecast for the Fiscal Period ending April 2014 (November 1, 2013 to April 30, 2014)(million yen; period-on-period change)

Fiscal PeriodEnding April 2014

OperatingRevenue
4,590

ChangeOperating
Income

0.4%

2,205

ChangeOrdinary
IncomeChangeNet
IncomeChange(3.8%)

1,300(12.8%)

1,299(12.8%)(yen)

Dividend per Share(not including dividends in excess of earnings)

Fiscal PeriodEnding April 2014

(Note 1)
(Note 2)

1,530

Dividend per Share in Excess of Earnings
0

The forecast Net Income per share for April 2014 is 1,260 yen.
The April 2014 dividend includes a dividend reserve reversal of 272 million yen and differs fromNet Income.

2

3. Other(1) Changes in Accounting Policies, Changes in Accounting Estimates, and Retrospective Restatement(i) Changes Accompanying Amendments to Accounting Standards:(ii) Changes Not Listed in (i):(iii) Changes in Accounting Estimates:(iv) Retrospective Restatement:

NoNoNoNo(2) Number of Shares Issued and Outstanding(i) The number of shares issued and outstanding (including treasury shares) was 842,823 shares at theend of April 2013 and 932,823 shares at the end of October 2013.
(ii) There were no treasury shares at either the end of April 2013 or at the end of October 2013.
Completion Status of Auditing ProceduresThis document is not subject to the auditing requirements set forth in the Financial Instruments and Exchange
Law of Japan. The auditing procedures in accordance with those requirements have not been completed as of thedate of the publication of this document.
Appropriate Use of Performance Forecasts and Other Matters of Special Note
The forecasts presented above are current figures based on certain preconditions. Accordingly, the actual
operating revenue, operating income, ordinary income, net income, dividend per share, and dividend per sharein excess of earnings may vary due to changes in circumstances. Moreover, these forecasts should not beconstrued as a guarantee of such performance or results.
For details on preconditions, please refer to the “Preconditions for Earnings Forecasts of the Fiscal Periods
ending April 2014” on pages 4-5.
This English version is a translation of the original Japanese notice and is provided solely for informational
purposes. Should there be any discrepancies between this translation and the Japanese original, the latter shallprevail.

3

Preconditions for Earnings Forecasts of the Fiscal Periods ending April 2014
Item

Preconditions

Periods

The Fiscal Period Ending April 2014: November 1, 2013 – April 30, 2014 (181 days)

Portfolio Assets

 71 properties as of April 30, 2014 (“Specified Assets”), which is the sum of 68 properties as ofOctober 31, 2013 and the four assets acquired on December 10, 2013 (Ichigo Kanda Ogawamachi
Building, Ichigo Hatchobori Building, Ichigo Shibuya Bunkamura-Dori Building, and Twicere
Yokohama Isogo (Retail Section)) minus one asset expected to be sold on April 30, 2013 (COIShinbashi Building). Sales gains of 52 million yen are expected from these asset sales.
 The number of assets may change due to acquisitions or sales.

Number of Shares 1,026,323 shares. This is the sum of the number of shares issued and outstanding at the time of thispublication (1,017,823 shares) and the newly issued shares by way of third-party allotment (8,500shares).

Operating Revenue Rental revenue is conservatively forecast based on leases that are in effect as of October 31, 2013,
taking into consideration such factors as historical rents, property competitiveness, and marketconditions.

Operating Expenses

 Ichigo REIT’s principal operating expenses are related to its rental activities. Excepting depreciation,expenses are calculated based on historical data while taking into consideration variable expenses.
 The anticipated amount of property tax and city planning tax is 313 million yen for April 2014. Inaddition, the prorated property tax and city planning tax relating to the acquisition of the Specified
Assets are included in the acquisition costs and not included in operating expenses.
 Building maintenance and repair expenses are estimated to be 117 million yen for April 2014.
However, expenses for each period could differ significantly from these estimated amounts for various
reasons due to the irregularity of maintenance and repair expenses, costs due to unexpected building
damage, etc., and year-to-year changes in costs.
 Service provider expenses including property management fees, etc. are estimated to be 421 million
yen for April 2014.
 Depreciation has been calculated using the straight line method. For managed properties, depreciation
is calculated by including the depreciation for future additional capital expenditures in the amortization
amount. Depreciation for April 2014 is forecast at 586 million yen.
 Due to unexpected circumstances, the actual operating expenses might differ significantly from theforecasts.

Non-operatingExpenses

 Interest expenses for April 2014 are forecast at 553 million yen.
 Borrowing-related expenses for April 2014 are forecast at 305 million yen.
 Expenses related to the issuance of new shares for April 2014 are forecast at 50 million yen.

Borrowings

 As of October 31, 2013, Ichigo REIT’s balance of loans payable stands at 59,519 million yen.
 4,000 million yen of new borrowing occurred on December 10, 2013.
 1,000 million yen of partial prepayment on January 31, 2014 is assumed.
 6,000 million yen from the total proceeds of the COI Shinbashi Building sale will be used for partial
loan prepayment.

Dividend per Share Dividends are based on the assumption that distribution will comply with the dividend distribution
policy stipulated in Ichigo REIT’s Articles of Incorporation.
 Dividend for April 2014 is assumed to be 1,572 million yen, which is the total amount of retainedearnings of 1,299 million yen plus a dividend reserve reversal of 272 million yen.
 The dividend per share is subject to change due to factors such as changes in rental revenue associatedwith tenant turnover, the occurrence of unexpected maintenance and repair costs, fluctuations ininterest rates, as well as additional share issuance.

Dividend in Excess ofEarnings per Share Ichigo REIT does not plan on making any dividend distribution in excess of earnings per share orretained earnings.

4Other Performance forecasts are based on the assumption that impactful revisions will not be made to laws
and ordinances, the tax system, accounting standards, listing rules, and rules of the Investment Trusts
Association, Japan, etc.
 Performance forecasts are also based on the assumption that there will be no unexpected materialchange in general economic trends, real estate market conditions, etc.

5Financial Statements(1) Balance Sheet(Thousand yen)
Fiscal PeriodEnding April 2013(as of April 30, 2013)

Fiscal PeriodEnding October 2013(as of October 31, 2013)

AssetsCurrent assets
Cash and deposits

3,413,067

4,356,603

Cash and deposits in trust

4,888,455

5,342,609

Operating accounts receivable

30,525

14,113

Prepaid expenses

342,781

327,054―

94,383283,932

246,580

2,126

4,438

8,960,888

10,385,783

Consumption taxes receivable
Deposit paid
Other
Total current assets
Noncurrent assets
Property, plant, and equipment
Buildings

8,514,591

8,618,744

Accumulated depreciation(385,530)(511,530)

Buildings, net

8,129,061

8,107,213

35,88235,882

Accumulated depreciation(7,001)(9,220)

Structures, net

28,881

26,661Structures

Machinery and equipment

257,998

262,686

Accumulated depreciation(30,123)(40,656)

Structures, net

227,875

222,030

43,15051,387

Accumulated depreciation(7,993)(12,368)

Fixtures, net

35,15739,01919,555,504

19,555,504

Fixtures

Land―

270

23,162,755

26,019,249

Accumulated depreciation(1,897,702)(2,264,878)

Buildings in trust, net

21,265,052

23,754,371

Construction in progress
Buildings in trust

Structures in trust
Accumulated depreciation
Structures in trust, net

63,22265,434(10,762)(12,232)

52,45953,201

Machinery and equipment in trust

181,705

210,882

Accumulated depreciation(41,455)(51,084)

Machinery and equipment in trust, net

140,249

159,797

644,955

657,444

Accumulated depreciation(159,464)(175,380)

Fixtures in trust, net

485,491

482,064

53,390,733

58,650,437

955

3,267

103,311,422

111,053,839

Fixtures in trust

Land in trust
Construction in progress in trust
Total property, plant, and equipment

6

(Thousand yen)
Fiscal PeriodEnding October 2013(as of October 31, 2013)

Fiscal PeriodEnding April 2013(as of April 30, 2013)
Investments and other assets
Tenant leasehold and security deposits

15,227

15,227Long-term prepaid expenses

542,690

467,927

Other
Total investments and other assets
Total noncurrent assets
Total assets
Liabilities
Current liabilities
Operating accounts payable
Current portion of long-term loans payable
Accounts payable – others
Accrued expenses
Income taxes payable, etc.
Accrued consumption taxes, etc.
Advances received
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Asset retirement obligations
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Shareholders’ capital
SurplusCapital surplus
Dividend reserve
Unappropriated retained earnings /loss
Total surplus
Total shareholders’ equity
Total net assets
Total liabilities and net assets

7―

1,709

557,917484,864

103,869,339

111,538,703

112,830,228

121,924,487

246,8282,460,000
229,157
83,528605
62,581
597,677
8,558
3,688,935

263,8932,478,500
265,90979,792605
13,824
668,26410,853
3,781,643

53,998,000
1,775,503
3,047,865
7,118
58,828,487
62,517,423

57,040,633
1,754,471
3,365,896
7,151
62,168,153
65,949,796

14,928,800

20,360,120

20,566,420
14,366,273
451,31135,384,005
50,312,805
50,312,805
112,830,228

20,566,420
13,558,219
1,489,931
35,614,571
55,974,691
55,974,691
121,924,487

(2) Income Statement(Thousand yen)
Fiscal PeriodEnding April 2013
(from November 1, 2012
to April 30, 2013)

Fiscal PeriodEnding October 2013
(from May 1, 2013
to October 31, 2013)Operating revenue
Rental revenue
Other rental revenue
Gain on sales of real estate
Total operating revenue

3,731,734

3,942,328

415,202465,120180

165,115

4,147,116

4,572,564

Operating expenses
Expenses related to rent business

1,671,178

1,815,226

Asset management fee

328,317364,251

Asset custody fee

10,4988,769

Administrative service fees

35,182

27,676

Directors’ compensation

6,300

6,300

Other operating expenses

59,15757,058

Total operating expenses

2,110,635

2,279,281

2,036,481

2,293,282

942

879

1,099

827

142

―

1,104―

Operating income
Non-operating income
Interest income
Reversal of distribution payable
Insurance Income
Interest on tax refund
Other
Total non-operating income

―

65

3,288

1,772

585,674

542,057

1,002,221

230,111

Non-operating expenses
Interest expenses
Borrowing related expenses―

32,537

1,587,896

804,706

Ordinary income

451,872

1,490,348

Income (losses) before income taxes

451,872

1,490,348

Income taxes – current

605

605

Total income taxes

605

605

451,267

1,489,743

43

187

451,311

1,489,931

Share issuance expenses
Total non-operating expenses

Net income
Retained earnings brought forward
Unappropriated retained earnings/loss

8

(3) Statement of Shareholders’ Equity(Thousand yen)
Fiscal PeriodEnding October 2013
(from May 1, 2013
to October 31, 2013)

Fiscal PeriodEnding April 2013
(from November 1, 2012
to April 30, 2013)
Shareholders’ equity
Shareholders’ capital
Balance at start of the period

14,928,800

14,928,800

Changes during the period
Issuance of new shares―

5,431,320

Total changes during the period―

5,431,320

14,928,800

20,360,120

20,566,420

20,566,420

Balance at end of the period
SurplusCapital surplus
Balance at start of the period
Changes during the period――

20,566,420

20,566,420

16,061,353

14,366,273

Reversal of dividend reserve(1,695,079)(808,053)

Total changes during the period(1,695,079)(808,053)

14,366,273

13,558,219(526,040)

451,311

Total changes during the period
Balance at end of the period
Dividend reserve
Balance at start of the period
Changes during the period

Balance at end of the period
Unappropriated retained earnings/loss
Balance at start of the period
Changes during the period
Reversal of dividend reserve

1,695,079

808,053(1,168,995)(1,259,177)

Net income

451,267

1,489,743

Total changes during the period

977,352

1,038,619

451,311

1,489,931

36,101,732

35,384,005――

Dividends from surplus

Balance at end of the period
Total surplus
Balance at start of the period
Changes during the period
Reversal of dividend reserve
Dividends from surplus(1,168,995)(1,259,177)

Net income

451,267

1,489,743

Total changes during the period(717,727)

230,566

35,384,005

35,614,571

51,030,532

50,312,805

Balance at end of the period
Total shareholders’ equity
Balance at start of the period
Changes during the period
Issuance of new shares―

5,431,320

Dividends from surplus(1,168,995)(1,259,177)

451,267

1,489,743

Net income
Total changes during the period(717,727)

5,661,886

50,312,805

55,974,691

51,030,532

50,312,805

Issuance of new shares―

5,431,320

Dividends from surplus

Balance at end of the period
Total net assets
Balance at start of the period
Changes during the period(1,168,995)(1,259,177)

Net income

451,267

1,489,743

Total changes during the period(717,727)

5,661,886

50,312,805

55,974,691

Balance at end of the period9(4) Cash Flow Statement(Thousand yen)
Fiscal PeriodEnding October 2013
(from May 1, 2013
to October 31, 2013)

Fiscal PeriodEnding April 2013
(from November 1, 2012
to April 30, 2013)
Cash flows from operating activities
Income before income taxes

451,872

1,490,348

Depreciation and amortization

506,056555,501―32,537

Share issuance expenses
Interest income(942)(879)

Interest expenses

585,674

542,057

Decrease (increase) in operating accounts receivable(17,786)

16,412

Decrease (increase) in consumption taxes receivable

108,851(94,383)

Decrease (increase) in prepaid expenses

67,962

15,727

Decrease (increase) in long-term advance charges(160,107)

74,762

Decrease (increase) in deposit paid

254,91137,351

Increase (decrease) in accrued consumption taxes

34,700(48,756)

Increase (decrease) in operating accounts payable(91,610)

48,558

Increase (decrease) in accounts payable – others(13,231)36,752

Increase (decrease) in advances received(13,849)

78,579Decrease by sale of property, plant, and equipment

617,220――

637,409

Decrease by sale of property, plant, and equipment in trust
Amortization of security deposit

(275)

(158)

Other, net(6,745)(9,321)

Subtotal

2,322,701

3,412,500

Interest income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities

942

879

(629,783)(545,793)

(605)

(605)

1,693,255

2,866,980

Cash flows from investment activities
Purchase of property, plant, and equipment(39,986)(111,883)

Purchase of property, plant, and equipment in trust(191,074)(8,856,491)

Increase in tenant leasehold and security deposits

37,582

84,271

Decrease in tenant leasehold and security deposits(156,826)(105,068)

Increase in tenant leasehold and security deposits in trust

260,255

529,569

Decrease in tenant leasehold and security deposits in trust(251,251)(219,608)

Net cash provided by (used in) investment activities(341,300)(8,679,210)

Increase in long-term loans payable

24,479,000

3,700,000

Decrease in long-term loans payable(22,790,000)(638,866)

Decrease in long-term loans payable in trust(2,910,799)――

5,398,782

Dividends paid

(1,167,748)(1,256,698)

Net cash provided by (used in) financing activities(2,389,547)

7,203,217

Net increase (decrease) in cash and cash equivalents(1,037,592)

1,390,987

Cash and cash equivalents at beginning of the period

9,323,338

8,285,745

Cash and cash equivalents at end of the period

8,285,745

9,676,732

Cash flows from financing activities

Proceeds from issuance of shares10