This is an English language summary of the original Japanese Asset Management Report available on our
Website. However, no assurance or warranties are given with respect to the accuracy or completeness of
this English language summary. The Japanese original shall prevail in the case of any discrepancies
between this summary and the Japanese original.

Invincible Investment Corporation
Asset Management Report
Fiscal Period ended June 30, 2022 (January 1, 2022 to June 30, 2022)
Content
Greetings from Naoki Fukuda, Executive Director of Invincible Investment Corporation and President &CEO of Consonant Investment Management Co., Ltd.
Top Interview
ESG Initiatives
Unitholder Benefit Program
I.
II.
III.
IV.
V.
VI.
VII.

Asset Management Report
Balance Sheet
Statement of Income and Retained Earnings
Statement of Changes in Net Assets
Notes to Financial Statements
Statement of Cash Distribution
Statement of Cash Flows (Reference Information)

Domestic Portfolio Map (As of August 31, 2022)
Financial Conditions

Overview of Unitholders/Investment Units
Information for Unitholders

Greetings from Naoki Fukuda, Executive Director of Invincible Investment Corporation and President& CEO of Consonant Investment Management Co., Ltd.
We would like to take this opportunity to express our sincere gratitude to all unitholders of Invincible
Investment Corporation ("INV") for your continued support. Our thoughts and prayers go out to all those
who have contracted the COVID-19 virus as well as their families and friends.
We hereby provide you with a report on INV's asset management and financial results for the 38th fiscal
period (from January 1, 2022 to June 30, 2022) (the "Reporting Period").
In the Reporting Period, due to the surge of the Omicron variant from the beginning of 2022, quasi-state of
emergency ordinances were applied in many prefectures. The quasi-state of emergency ordinances werelifted in late March and both business and leisure demand for hotels have improved. As a result, the averageoccupancy rate for domestic hotels owned by INV from April to June 2022 reached nearly 70%.
The average occupancy rate in the same period in 2019, before the COVID-19 pandemic, was about 90%, ofwhich inbound visitors accounted for about 30%.

In light of this, an assessment can be made that therecovery in hotel demand by domestic customers has progressed to a certain extent.
On the other hand, the number of inbound visitors to Japan continue to be significantly lower than 2019, and
it is expected to take more time to resume a full-fledged border entry. According to various surveys, thedesire to travel abroad, especially to Japan, is increasing. We are confident that inbound visitors will returnonce the restrictions on inbound travel are lifted. Moreover, the current depreciation of the yen can be afurther tailwind if it continues.
In the Cayman Islands, the operating conditions of the two Cayman hotels owned by INV have improved
significantly since the resumption of commercial flights to and from the U.S. by major U.S. airlines in
February 2022. Both the occupancy rate and the average daily rate have risen, and the hotels bottom line
turned positive for the Reporting Period. Further recovery is expected in the next high season, which comes
after Thanksgiving in late November.
Although the environment surrounding hotels has been steadily improving, the performance of MyStays
Hotel Management Co., Ltd., the major tenant and hotel operator of domestic hotels owned by INV, has not
yet reached the level where they can pay the fixed rent stipulated in the original contract. Therefore, INV
was again forced to accept substantial rent reductions for the Reporting Period.
Overall, INV announced a distribution per unit of JPY 166 by recording a gain on sale of property of JPY
1,468 million, despite severe operating conditions in the Reporting Period. Operating revenues were JPY
7,680 million, with operating income of JPY 2,114 million, and net income of JPY 1,015 million.
While distributions per unit were the same as the previous fiscal period, the gain on sale of properties
decreased by ¥1.1 billion, which indicates a smaller reliance on gains on sale since the performance of INV
owned hotels are recovering.

While the earnings forecast for the December 2022 fiscal period isundetermined at this point (as of the end of August 2022), our immediate goal is to improve revenues to alevel where we can record positive net income and pay distributions without any gain on the sale of properties.
-1-

While the effect of the COVID-19 pandemic remains and Japan has been hit by the seventh wave of infections
since July, there were no restrictions on movement this summer. Additional good news was also reported
as fireworks festivals and summer festivals resumed in various places for the first time in three years.
Although tourism and accommodation demand has not yet returned to previous levels due to restrictions on
admission and the wearing of masks, we are steadily experiencing a recovery toward the normalization of
hotel operations. In order to meet unitholder expectations, we will continue to work on daily operations sothat the hotels owned by INV will achieve an earnings recovery as soon as possible by attracting domestic
and overseas guests.

Your continued support is highly appreciated.
Naoki Fukuda
Executive Director, Invincible Investment Corporation
President & CEO, Consonant Investment Management Co., Ltd.

-2-

Summary of Financial Results
Period fromJanuary 1, 2020 toJune 30, 2020

Period from
July 1, 2020 to
December 31, 2020

Period fromJanuary 1, 2021 toJune 30, 2021

Period from
July 1, 2021 to
December 31, 2021

Period fromJanuary 1, 2022
toJune 30, 2022

Operating Revenues(JPY million)

9,410

8,340

3,806

8,406

7,680

Ordinary Income(JPY million)

424

624

-3,599

1,014

1,015

Net Income(JPY million)

423

623

-3,599

1,014

1,015

Net Assets(JPY million)

249,538

249,641

245,113

246,130

246,211

Total Assets(JPY million)

516,663

516,490

497,899494,819

490,118

Net Assets per Unit
(JPY)

40,92940,94640,20340,37040,383

Net Assets/Total
Assets (%)

48.3

48.3

49.2

49.7

50.2

Distribution per Unit
(JPY)

69

167

15

166

166

6,096,840

6,096,840

6,096,840

6,096,840

6,096,840

Number of Units
Issued (Unit)

Distribution per unit for the 38th fiscal period(the fiscal period ended June 2022)

JPY 166(Note) The forward-looking statements, forecasts and goals described in this report are based on available information, assumptions andestimates as of August 31, 2022. These assumptions and estimates are unavoidably uncertain, and could be affected by various risks
and factors beyond INV’s control. Thus, no guarantee can be made regarding the realization of such future forecasts and targets, andactual results may vary significantly.

-3-Top Interview
Q: What is needed for further recovery of the domestic hotel performance?
A: We believe that the recovery of inbound visitors to Japan will be the key point.
Until 2019, about 30% of INV owned domestic hotels sales were from inbound customers.

Whileinbound demand has almost disappeared due to the pandemic, hotel operators have been working hard tocapture domestic demand. As a result, it has been pointed out that domestic leisure demand has already
returned to the level before the COVID-19 pandemic. We believe that it is becoming difficult to expect
a significant increase in hotel performance without a full-fledged recovery in inbound visitors.
However, Japan continues to limit the number of entries to Japan per day to 20,000 people (including
Japanese) as of the end of August 2022. There was a media report (as of August 24, 2022) that the daily
cap on arrivals would be raised to 50,000 people (as of August 24, 2022) from September but is still about
the half of the level of the roughly 140,000 average entries per day in 2019. Moreover, the timing of theresumption of entry for individual travelers for tourism purposes, which accounted for the majority of
inbound visitors to Japan until 2019, has not been decided.

As of the end of August 2022, entry fortourism purposes is limited to group tours with tour conductors. The attractiveness of Japan's tourism
resources has not been lost, and the desire to travel is increasing among foreigners once the environment
becomes safer to travel. Although the timing is difficult to predict, we expect that inbound visitors toJapan will return in the future, and the hotel performance will further recover.
Q: What is the background as to why the Cayman hotels’ bottom line turned to positive from negative?
A: In February 2022, quarantine measures for travelers were greatly relaxed in the Cayman Islands, andcommercial flights by major U.S. based airlines resumed, bringing back U.S. travelers.
The easing of quarantine measures in the Cayman Islands is proceeding ahead of Japan. From January
20, 2022, unvaccinated children under the age of twelve years old “assumed” the vaccination status of
their adult travel companions, and quarantine measures after entry were no longer required. Further, thelateral flow tests on days 2, 5, and 7 was lifted as of February 17, 2022. This was clearly a major factor
to avoid travel to the Cayman Islands as this could result in a 10-day quarantine if positive.
In addition, effective on August 24, 2022, the quarantine measures after entering the country were nolonger required for unvaccinated people. We received reports from our Cayman hotels that reservations
have increased for the next peak season starting on Thanksgiving Day in late November.
We believe that these developments in the Cayman Islands will be helpful to see future recovery in thedomestic hotel market in Japan.
Q: Are there any particular issues with the financial conditions and cash flow of INV?
A: Although business performance has been sluggish amid COVID-19, INV has never violated any financial
covenants since the outbreak of the pandemic up to the date hereof.

We believe that we have been able

to appropriately control our interest-bearing debt ratio (LTV). The net income this period is ¥1,015-4-

million. While the change in net income was almost flat compared to the previous period, reliance on
gains on sale decreased significantly. In this trend, we aim for positive net income in the December
2022 fiscal period without any gain on the sale of properties. Under these circumstances, the relationshipwith banks is basically good. We believe that we will be able to proceed with future refinancing withoutmajor problems going forward.
For the past two years, the retention of cash on hand has been the most important issue as a response to
the market uncertainty. As market conditions have improved slightly in the current fiscal period, smallscale value-up work has resumed. At Hotel Epinard Nasu, one of our flagship properties, we renovatedthe bakery in front of the lobby on the first floor.

After reopening in July this year, it has been very

well received by customers. We anticipate being able to introduce many such forward-looking projects
in the future.

Hotel made bakery shop and café “Komorebi Table” reopened on Friday, July 1, 2022 at Hotel Epinard Nasu.
⚫

Previously, there was no dedicated bakery oven, and bread was baked only once a day.

Afterrenovation, the supply improved to meet demand.
⚫

It has become a bakery that "has a variety of freshly baked bread whenever you visit.".

⚫

The eat-in space also increased from 48 seats to 56 seats. Wallpaper, chairs, and tables were also
renewed.

⚫

We used F Four Star products (Please see page 7 for details) for the floor tiles, wall, and pillar cloths
in the renovation work.

-5-

ESG Initiatives
INV recognizes the importance of environmental, social, and governance (ESG) considerations in real estate
investment management from the viewpoint of sustainability such as economic and social development andcontributing to global environmental conservation, and regard improvement of sustainability as an importantmanagement issue and implement initiatives to contribute to make our society sustainable. MyStays HotelManagement Co., Ltd. (MHM), the main operator of INV‘s domestic hotel portfolio, is also actively
promoting and continuing ESG-related initiatives at its hotels.
Initiatives by INVInitiatives for Environment
Green Leases1
Track record of signing green leases with theagreed tenants including MHM, INV's main
tenant that operates most of INV's hotels (as of theend of June 2022, includes two overseas hotels).

Number of hotels with
Green Lease

Total floor area ratio covered in
the entire portfolio

Yet to Sign
Yet toSign
Signed（Note 1）Green lease is an initiative in which owners and tenantsof a real estate asset voluntarily agree in a lease contract to work
together on measures related to the environmental consideration of
the real estate and put them into practice34.4%

Signed65.6%

Initiatives for Society
Acceptance of COVID-19 patients
Three of our hotels were utilized as accommodation andmedical facilities for patients with mild symptoms.
APA Hotel Yokohama-Kannai: since August 4, 2020
Hotel MyStays Oita: since January 16, 2022
Comfort Hotel Kitami: since January 20, 2022
Information
GRESB Real Estate Assessment2
In the 2021 GRESB Real Estate Assessment, INV received a “2-Star” GRESB Rating, which is based on
overall GRESB scores and its quintile position among participants. INV was also awarded a “GreenStar” designation by achieving high performance in both the “Management Component” that evaluates
policies and organizational structure for ESG (Environmental, Social, and Governance) promotion, andthe “Performance Component” that assesses environmental performance and tenant engagement ofproperties owned. Further, INV was highly evaluated for its ESG information disclosure efforts andreceived an “A Level” the highest level for GRESB Public Disclosure, which assesses the breadth of ESG
disclosure. We will consider preparations for acquiring evaluation by other external organizations, suchas green building certification, to strengthen our ESG initiatives.
(Note 2) GRESB is an annual benchmarking program to evaluate ESG considerations ofproperty companies and real estate funds. The GRESB Real Estate Assessment is distinguishedby its comprehensive evaluation of initiatives for sustainability of property companies, REITs
and real estate funds, not of individual properties. GRESB rating is a relative evaluation basedon comprehensive scores and the highest being "5-stars".

-6-

Initiatives by MHM

Initiatives for Environment
MHM Group “Matching Project”
Committed to reusing items and reducing waste, MHM started a “matching project” in March 2022, topromote the movement of unnecessary tableware, furniture, equipment, etc. between its hotels.
(Examples)
Hotel MyStays
Premier Akasaka↓
Hotel MyStays
Premier Narita

Hotel MyStays
Fuji Onsen
Resort↓Art Hotel
Asahikawa
Cleaning Cart

Sofa and Ottoman

Environmentally friendly materials(Hotel Epinard Nasu)
In order to reduce the use of materials containing volatile organic compounds (VOCs) and harmful
substances, we used F Four Star products (*) for the floor tiles, wall and pillar cloths in the cafe and bakery
renovation work.
※ F Four Star Product（Ｆ☆☆☆☆）Classification of Building Materials under the Revised BuildingStandards Act
It is the highest standard in the formaldehyde grade stipulated by theJapanese Industrial Standards, and is a building material with the lowest
amount of formaldehyde emission (formaldehyde is one of the volatileorganic compounds)
Initiatives for Society
Contributing to society through food(Restaurants at Hotel MyStays Premier Park Sapporo, Art Hotel Hirosaki, etc.)
In the BEST CHEF cooking contest of the MyStays chain, by devising amenu using gibier, MHM supports areas suffering from crop damage by
deer and wild boar and creates opportunities for young chefs to think
about food problems in Japan.
Social contribution using hotels(Hotel MyStays Yokohama)
Held a charity event to support Ukraine at the Ukrainian
restaurant on the first floor of the hotel. The city of Yokohama,where the hotel is located, and the city of Odesa in Ukraine aresister cities, and part of the sales proceeds were donated tosupport Ukraine.

-7-

Unitholder Benefit Program
INV has introduced the unitholder benefit program to improve the satisfaction of its unitholders and expand
the unitholder base. Eligible unitholders can stay at Sheraton Grande Tokyo Bay Hotel and all MyStays
group hotels at special discount rates. In 2022, the Kamenoi Hotel brand were newly added, and the numberof hotels where you can enjoy hot springs has increased to 55 hotels.
*Detailed information is sent to eligible unitholders along with this report.

Overview of the Unitholder Benefit Program(Note 1)◼ Sheraton Grande Tokyo Bay Hotel
Applicable Hotels◼ All hotels managed by MyStays (Note 2)
All Unitholders whose names are recorded on Invincible’s Unitholders’ Registry
as of the relevant record dates:
Eligible Unitholders *INV decided to remove the eligibility requirement of "holding 10 or moreunits" to enable all INV unitholders to utilize the Unitholder Benefit
Program from the June 2020 Fiscal Period and onwards.
Record Date

The last day of every fiscal period (June 30 and December 31 of each year)

Program Details

Stay with unitholder special discount rates at the above applicable hotels

Hotel Reservation
Available Period(Note 3)

◼Sheraton Grande Tokyo Bay Hotel
Reservation via phone or Email◼ All MyStays hotels and Kamenoi Hotels
Reservation via official website or phone
From April 1 to September 30 (eligible unitholders as of December 31)
From October 1 to March 31 (eligible unitholders as of June 30)

Sheraton Grande Tokyo Bay Hotel

Hotel Epinard Nasu

Fusaki Beach Resort Hotel & Villas(Note 1)
(Note 2)

Hotel MyStays Premier Akasaka

The details of the unitholder benefit program described above are as planned by Invincible as of August 31, 2022, and the program may be changed orabolished even after it is has been introduced.
Refers to all hotels under MyStays brand managed by MHM, and hotels shown on the MyStays Hotel Group’s official website (https://www.mystays.com/en--8-

(Note 3)us/) will be applicable.
Available Period represents a period during which you can lodge by using the unitholder benefit program.
actually need to lodge during the availability period.

-9-

To enjoy the unitholder benefit program, you

I.

Asset Management Report

Overview of Asset Management
1

Trends in Investment Corporation’s Operating Results
By Period

Reporting period

34th

35th

36th

37th

38th

fiscal period

fiscal period

fiscal period

fiscal period

fiscal period

Jan. 1, 2020 toJul. 1, 2020 toJan. 1, 2021 toJul. 1, 2021 toJan. 1, 2022 toJun. 30, 2020

Dec. 31, 2020

Jun. 30, 2021

Dec. 31, 2021

Jun. 30, 2022

Operating Results

Operating revenue(JPY thousand)

9,410,225

8,340,593

3,806,176

8,406,334

7,680,227(Rental revenue – real estate)(JPY thousand)

5,838,836

5,738,249

3,806,176

5,837,847

5,198,229

Operating expenses(JPY thousand)

7,913,247

6,649,749

6,147,595

6,113,994

5,565,846(Property-related expenses)(JPY thousand)

6,801,584

5,044,533

4,720,815

4,777,042

4,498,723

Operating income (loss)(JPY thousand)

1,496,977

1,690,843(2,341,419)

2,292,339

2,114,380

Ordinary income (loss)(JPY thousand)

424,522624,333(3,599,083)

1,014,799

1,015,760

Net income (loss)(JPY thousand)

423,917623,728(3,599,688)

1,014,194

1,015,155(a) (JPY thousand)

516,663,418

516,490,350

497,899,915

494,819,805

490,118,752

(%)

(1.1)

(0.0)

(3.6)

(0.6)

(1.0)

(JPY thousand)

263,468,000

262,588,000

249,198,000

244,945,000

241,372,000(b) (JPY thousand)

249,538,194

249,641,218

245,113,891

246,130,354

246,211,129

(%)

(3.9)

0.0

(1.8)

0.4

0.0

Unitholders’ capital(JPY thousand)

235,701,512

235,701,512

235,701,512

235,701,512

235,701,512

Total distributions(c) (JPY thousand)

420,6811,018,172

91,452

1,012,075

1,012,075(Note 1) (%)

99.2

163.2

-

99.8

99.7

(d) (Units)

6,096,840

6,096,840

6,096,840

6,096,840

6,096,840(b) / (d) (Note 2) (JPY)

40,92940,94640,20340,37040,383

Total assets(change from last period)

AssetsInterest-bearing debt
Net assets(change from last period)

Dividend
StatusDividend payout ratio
Number of investment units

Information per Unit

issued and outstanding
Net assets per unit(c) / (d) (JPY)

69

167

15

166

166

(Distributions of earnings per unit)

(JPY)

69

167

15

166

166

(Distributions in excess of retained

(JPY)

-

-

-

-

-

0.1

0.1

(0.7)

0.2

0.2

0.2

0.2

(1.4)

0.4

0.4

0.2

0.2

(1.5)

0.4

0.4

0.3

0.5

(2.9)

0.8

0.8

48.3
(1.4)

48.3
0.0

49.2
0.9

49.7
0.5

50.2

(%)
(Note 3) (JPY thousand)

3,392,004

3,703,215

2,090,413

4,201,550

4,936,210

Distributions per unit

earnings per unit)
Return on assets(annualized)

Financial Measures

Return on equity(annualized)
Capital ratio(change from last period)(Note 3) (%)(Note 3) (%)(b) / (a) (Note 3) (%)

NOI(Net Operating Income)

0.5(Note 1) Dividend payout ratio is calculated in accordance with the following formula and rounded to one decimal place:
Dividend payout ratio = Distribution amount (Excluding distributions in excess of retained earnings) ÷ Net income × 100(Note 2) Net assets per unit are rounded to the nearest unit.

- 10 -

(Note 3) Figures above are calculated as below, and ratios are rounded to one decimal place. Figures annualized according
to the number of days are also shown.
Return on assets = Ordinary income for relevant period / ((Total assets at start of relevant period + Total assets at endof relevant period) / 2) x 100.
Return on equity = Net income for relevant period / ((Net assets at start of relevant period + Net assets at end of
relevant period) / 2) x 100.
Capital ratio = Net assets at end of relevant period / Total assets at end of relevant period x 100.
NOI = Rental revenue – Property-related expenses + Management contract revenue - Management contract expenses+ Depreciation expense for relevant period- 11 -

2

Overview of Asset Management for the Fiscal Period Ended June 2022(a)

Main Trends of INV

INV was established in January 2002 in accordance with the Investment Trust and Investment Corporation Act (Act No.
198 of 1951, as amended; the “Investment Trust Act”). In May 2004, INV was listed on the Osaka Securities Exchange(application for delisting was made in August 2007), and in August 2006 was listed on the Real Estate Investment andTrust Securities Section of the Tokyo Stock Exchange (Ticker Code: 8963).
After the absorption-type merger with LCP Investment Corporation (“LCP”) was implemented on February 1, 2010, INV
issued new investment units through a third-party allotment on July 29, 2011 and refinanced its debt. Calliope Godo
Kaisha (“Calliope”), an affiliate of the Fortress Investment Group LLC (“FIG” and together with Calliope and otheraffiliates of FIG, collectively the “Fortress Group”) was the main allottee, and the sponsor changed to the Fortress Group.
FIG became a subsidiary of SoftBank Group Corp. (“SoftBank Group”), after SoftBank Group acquired FIG effective on
December 27, 2017 (Note 1). Calliope, an affiliate of FIG, who owned 100% of the issued shares of Consonant
Investment Management Co., Ltd., the asset manager to which INV entrusts the management of its assets (“CIM”),
transferred 80.0% of issued shares of CIM to Fortress CIM Holdings L.P., a subsidiary of SoftBank Group, and 20.0% to
SoftBank Group on March 29, 2018, pursuant to the basic agreement which was entered into as of September 7, 2017.
Although FIG is no longer an indirect parent company of CIM, FIG continues to support INV as the sponsor.
Ever since the commencement of sponsorship from the Fortress Group (Note 2), INV has been focusing its efforts on
improving the profitability of its portfolio and establishing a revenue base in order to secure stable distributions, and has
strengthened the lender formation through new borrowings and the refinancing of existing bank borrowings, thereby
creating a financial base for external growth. With this platform as a base, in June 2014, CIM revised the Investment
Guidelines for INV, positioned hotels as a core asset class alongside residential properties with a view towards expanding
investments in the hotel sector in which demand is forecasted to rise going forward, and has expanded its portfolio.
Moreover, CIM revised the Investment Guidelines as of July 17, 2018. Such revision was intended to establish an
investment policy and asset management structure regarding investments in overseas assets, and also to change theinvestment policy regarding domestic hotels to focus on (i) Limited service hotels, which feature relatively higher profit
margins and potential for revenue growth backed by increasing demand for accommodations, and (ii) Full-service andResort hotels, which have a variety of revenue sources, including lodging, dining and sales of goods, that are expected toachieve stable growth in overall hotel revenues. Based on such change in investment policy, in July 2018, INV decided
on the acquisition of TK (Japanese anonymous association (tokumei kumiai)) interest in two overseas hotels, “Westin
Grand Cayman Seven Mile Beach Resort & SPA” and “Sunshine Suites Resort” (collectively, the “Cayman Hotels”) as
underlying assets for the first time ever in J-REIT history. In September 2018, INV implemented the investment in the
Cayman Hotels via a global offering of new investment units and borrowing of funds. INV intends to improve both theprofitability and stability of the portfolio through such investments, including investment in the Cayman Hotels, whichis expected to even out the effects of seasonality in INV’s portfolio.
In the Fiscal Period ended June 30, 2022 (“Reporting Period”), INV sold six residential properties on January 12, 2022.
As a result, INV's portfolio at the end of the Reporting Period is comprised of 128 properties (86 hotels (Note 3) (Note4), 41 residential properties and one retail facility) with a total acquisition price of JPY 491,395 million (Note 5).
Furthermore, INV’s hotel portfolio has the largest asset size (Note 6) of JPY 450,609 million (86 properties, 15,597
rooms) among all J-REIT hotel portfolios including hotel-and-inn-specific type investment corporations.
(Note 1)
(Note 2)

(Note 3)

US Eastern Standard Time
As of July 2011, Calliope owned 97.35% of issued shares of CIM and the investment ratio reached 100% in
October 2013. Calliope transferred 80.0% of issued shares to Fortress CIM Holdings L.P., a subsidiary of
SoftBank Group and 20.0% to SoftBank Group on March 29, 2018. As of the date of this document,
SoftBank Group owns 100% of issued shares of CIM directly and indirectly.
The preferred equity interest held by INV is counted as one property. Such preferred equity interest issued- 12 -

by a special purpose company (tokutei mokuteki kaisha) refers to 178,458 units of the preferred equity interest
issued by Kingdom Special Purpose Company (the “TMK”) (equivalent to 49.0% of the total issued andoutstanding preferred equity interest), which owns the trust beneficiary interest of the Sheraton Grande Tokyo
Bay Hotel as an underlying asset. The property is classified as a hotel, based on the use of Sheraton GrandeTokyo Bay Hotel, the underlying asset of the preferred equity interest, and INV’s investment amount of thepreferred equity interest is used as the acquisition price of the preferred equity interest, unless otherwise stated.
The “underlying asset” refers to the real estate or the real estate related assets owned by a TK operator of TK
interest or a TMK relating to the preferred equity interest which INV owns, thus the real estate or the realestate related assets which will be the revenue source of INV. Hereinafter the same shall apply.
(Note 4) From September 28, 2018 (Cayman Island local time; September 29, 2018 in Japan local time), INV owned
100% of the TK interest in Seven Mile Resort Holdings Ltd. (the “Cayman SPC”), a Cayman Islands special
purpose company that holds leasehold interests in the Cayman Hotels and ancillary assets as underlying assets.
However, INV implemented the investment structure change (the “Structure Change” in some cases
hereinafter) regarding the Cayman Hotels on May 9, 2019 (Cayman Island local time; May 10, 2019 in Japan
local time) and has directly held the Leasehold Interests, etc. of the Cayman Hotels thereafter. Both of the
TK interest and the Cayman Hotels are counted as two properties before and after the Structure Change. In
addition, the “Leasehold Interests, etc.” means leasehold interests (rights equivalent to long-term real estateleases on land and buildings under the British Cayman laws) and furniture, fixtures, equipment, ornaments,
kitchen instrument, and other assets required for hotel operations. Hereinafter the same shall apply.
(Note 5) Due to the Structure Change, the book value of the leasehold interests of the Cayman Hotels recorded by the
Cayman SPC as of May 9, 2019 (Cayman Island local time; May 10, 2019 in Japan local time), when INV
succeeded the leasehold interests of the Cayman Hotels from the Cayman SPC via distribution in kind inconnection with the termination of TK agreement, is deemed as the acquisition price of the Cayman Hotels.
The book value is converted into JPY amount via exchange rate of USD 1=JPY 110.45 based on the foreignexchange forward contracts concluded on July 26, 2018 and executed on September 26, 2018 in connection
with the investment in the TK interest by INV. Hereinafter the same shall apply.
(Note 6) “The largest asset size … among all J-REIT hotel portfolios” refers to the total acquisition price of 86 hotels
owned by INV as compared with the total acquisition price of hotels (including inns and other accommodation
facilities) owned by listed investment corporations other than INV as of June 30, 2022.
(b)

Operational Environment and Performance

Given the enormous impact of COVID-19 on the economy as a whole, especially in the hotel sector, on March 11, 2022,
INV entered into Memorandum of Understanding (the “MOU”) to amend each fixed-term building lease and property
management agreement (“MLPM Agreements”) pertaining to the rent conditions for the periods from January 1, 2022 toJune 30, 2022 for domestic hotels owned by INV and operated by INV's main tenant, MyStays Hotel Management Co.,
Ltd. (“MHM”) and its affiliates (collectively the “MHM Group” along with MHM). Pursuant to the MOU, we havechanged the rent payment conditions of MLPM Agreements in terms of the amount of fixed rent payment, the variable
rent calculation method, payment method of rent and payment date.
For the June 2022 fiscal period, the portfolio NOI (Note 1) increased by 136.1% or JPY 2,845 million compared to thesame period in the previous year (the June 2021 fiscal period) to JPY 4,936 million. The hotel portfolio NOI increasedby JPY 3,241 million. The residential and retail portfolio NOI decreased by JPY 395 million due to asset sales.
Compared to the June 2019 fiscal period prior to the COVID-19 pandemic, the portfolio NOI decreased by 66.5% or JPY
9,798 million, of which the hotel portfolio NOI decreased by JPY 8,291 million and the residential and retail portfolio
NOI decreased by JPY 1,506 million due to asset sales. The NOI of the retail portfolio (AEON TOWN Sukagawa) was
significantly lower than the previous year because the repair cost for the restoration work for the damage caused by theearthquake that occurred off the coast of Fukushima Prefecture on February 13, 2021 was recorded in June 2022.
Commentary on hotel and residential performance in the Reporting Period is as described below.
The NOI for the Reporting Period of the 75 domestic hotels (Note 2) owned by INV increased by 315.7% compared to- 13 -

the same period in the previous year (figures exclude nine domestic hotels with fixed-rent lease agreements among the84 domestic hotels owned by INV as of the end of the Reporting Period, including Sheraton Grande Tokyo Bay Hotel,
the underlying asset of the preferred equity interest of TMK owned by INV). The 75 domestic hotels recorded an
occupancy rate (Note 3) of 61.5% (+25.9 points YoY), ADR (Note 4) of JPY 7,504 (+8.1% YoY), and RevPAR (Note 5)of JPY 4,614 (+86.7% YoY). Compared to the June 2019 fiscal period prior to the COVID-19 pandemic, the NOI
decreased by 76.9%, the occupancy rate decreased by 25.3pt, ADR decreased by 25.8%, and RevPAR decreased by 47.4%.
Westin Grand Cayman Seven Mile Beach Resort & Spa and Sunshine Suites Resort recorded an average occupancy rateof 39.7% (+31.9 points YoY), ADR of USD 370 (+129.1% YoY), and RevPAR of USD 147 (+1,055.0% YoY) for theReporting Period. Compared to the December 2019 fiscal period prior to the COVID-19 pandemic, the occupancy rate
decreased by 49.6pt, ADR decreased by 11.0%, and RevPAR decreased by 60.4%.
Regarding the hotel sector in Japan, domestic hotel demand has significantly declined compared to pre-COVID-19
pandemic levels due to a sharp reduction in inbound visitors and self-restraint in business trips and leisure travel underthe quasi-State of Emergency and other measures. However, since behavioral restrictions have been removed in lateMarch, high occupancy rates were recorded primarily by the hotels that were able to capture group accommodation andbusiness demand, as well as leisure demand derived from an increase in various events in the market and tourism support
measures such as prefectural travel subsidy campaigns, which helped the overall occupancy rate reach the 60% level.
As for the Cayman Hotels, the key performance indicators significantly improved YoY due to the phased relaxation of
epidemic prevention measures for tourists and the resumption of flight service to the Cayman Islands by major US airlines
for the first time in about two years since March 2020.
Regarding the residential portfolio (Note 6), the occupancy rate (Note 7) of 41 residential properties decreased by 0.2
points from 96.2% at the end of the previous fiscal period to 96.0% at the end of the Reporting Period. The averageoccupancy rate (Note 7) remained flat YoY at 96.0%. The NOI (Note 8) for the Reporting Period decreased by 0.2%
YoY.
In the Reporting Period, INV realized a rent increase for 25.2% (based on the number of contracts) of the new residential
lease contracts, however the new rent decreased by 3.1% compared to the previous rent across all new leases (Note 9).
INV achieved a rent increase for 36.6% (based on the number of contracts) of contract renewals with an average rent
increase of 1.3% compared to the previous rent across all renewal leases, while maintaining a high contract renewal rate
(Note 10) of 79.6%. Combined, new lease and renewal lease rents were signed at 0.4% lower than the previous leases.
The average rent per tsubo per month (Note 11) for the Reporting Period remained almost flat YoY at JPY 9,127.
The total appraisal value of 127 properties was JPY 530,212 million (1 out of the 128 properties owned by INV at theend of the Reporting Period is excluded from the appraisal calculation: Sheraton Grande Tokyo Bay Hotel (preferred
equity interest) for which the appraisal value of such interest is not available). The portfolio has an unrealized gain of
JPY 84,435 million (Note 12) and an unrealized gain ratio of 18.9% (Note 12). The total appraisal value of 127
properties which were owned throughout the Reporting Period increased by 2.1% from JPY 519,245 million at the endof the December 2021 fiscal period to JPY 530,212 million at the end of the Reporting Period.

Key Performance Indicators of 75 Domestic Hotel Properties (Note 2)
June 2022 fiscal period

Year-on-year change

vs 1H 2019

Occupancy Rate (Note 3)

61.5%+25.9pt-25.3pt

ADR (JPY) (Note 4)

7,504

+8.1%

-25.8%

RevPAR (JPY) (Note 5)

4,614+86.7%-47.4%GOP (JPY million) (Note 13)3,194+389.7% (Note 14)-72.4%- 14 -

Key Performance Indicators of Cayman Hotels
June 2022 fiscal period

Year-on-year change

Occupancy Rate (Note 3)

39.7%+31.9pt

vs 1H 2019-49.6pt

ADR (USD) (Note 4)

370+129.1%-11.0%

RevPAR (USD) (Note 5)147+1,055.0%-60.4%GOP (USD) (Note 13)

8,559,847- (Note 15)-67.9%Key Performance Indicators of 41 Residential Properties (Note 6)
June 2022 fiscal period
Occupancy Rate (Note 7)
Average Rent per Tsubo per Month(JPY) (Note 11)
NOI (JPY million) (Note 8)(Note 1)Year-on-year change

96.0%+0.0pt

9,127

-0.0%

1,113

-0.2%

“NOI” for the hotel properties is calculated in accordance with the following formula:
NOI＝ Rental Revenues ‐ Property Related Expenses + Depreciation Expenses + Dividend on the preferred
equity interest (TMK dividend) + (Management Contract Revenue of the Cayman Hotels ‐Management
Contract Expense)(Note 2) Of the 84 hotels held as of the end of June 2022 (including the Sheraton Grande Tokyo Bay Hotel, the underlying
asset of the preferred equity interest of TMK owned by INV), the following nine hotels with fixed-rent leaseagreements are excluded: Super Hotel Shinbashi/Karasumoriguchi, Comfort Hotel Toyama, Super Hotel TokyoJR Tachikawa Kitaguchi, Super Hotel JR Ueno-iriyaguchi, Comfort Hotel Kurosaki, Comfort Hotel Maebashi,
Comfort Hotel Tsubame-Sanjo, Comfort Hotel Kitami and Takamatsu Tokyu REI Hotel. In addition, thefigures for the properties acquired after January 2019 are calculated on the assumption INV had acquired those
properties on January 1, 2019, using the actual figures provided by the sellers of such properties for the period
before the acquisition. Hereinafter the same shall apply.
(Note 3) “Occupancy rate” for the hotel properties is calculated in accordance with the following formula:
Occupancy rate = total number of occupied rooms during a certain period ÷ total number of rooms available
during the same period (number of rooms x number of days)
Hereinafter the same shall apply.
(Note 4) “ADR” means average daily rate, and is calculated by dividing total room sales (excluding service fees) for acertain period by the total number of days per room for which each room was occupied during the same period.
Hereinafter the same shall apply.
(Note 5) “RevPAR” means revenues per available room per day, and is calculated by dividing total room sales for acertain period by total number of rooms available (number of rooms x number of days) during the same period,and is the same as the figure obtained by multiplying ADR by occupancy rates. Hereinafter the same shallapply.
(Note 6) Based on the 41 residential properties owned as of the end of June 2022. Hereinafter the same shall apply.
(Note 7) “Occupancy Rate” and “Average Occupancy Rate” for the portfolio or the residential properties are calculatedby dividing the sum of total leased area by the sum of total leasable area at the end of each month during therelevant period. Hereinafter the same shall apply.
(Note 8) For the comparison of NOI for the residential properties, one-off insurance-related revenues and expenses are
excluded. Hereinafter the same shall apply.
(Note 9) Increase or decrease in the sum of monthly rents on new or renewal contracts, or the total of both, comparedwith the sum of previous rents. Hereinafter the same shall apply.
(Note 10) Renewal rate is calculated by the number of renewed contracts during the relevant period divided by the numberof contracts due up for renewal during the relevant period.
(Note 11) “Average Rent per Tsubo per Month” is calculated by dividing the total rental revenue (including common area

- 15 -

charges) for each month by the sum of total leased area (tsubo) at the end of each month during the relevant
period.
(Note 12) The unrealized gain is calculated using the following formula: the appraisal value as of the end of the Reporting
Period - book value as of the end of the Reporting Period.
The unrealized gain ratio is calculated using the following formula: the unrealized gain ÷ book value as of theend of the Reporting Period.
(Note 13) “GOP” means the gross operating profit, and is the amount remaining after deducting costs of hotel operations(the personnel, utility and advertising expenses and other expenses) and the management services fee tooperators (if any) from the hotel’s revenues. GOP for each fiscal period ended June 2020 and onwards includes
the amount of employment adjustment subsidies to be received by the hotel operators for the respective fiscal
period, which requires a certain period of time to confirm. Therefore, the amount of GOP is subject to change
retroactively upon confirmation of the amount of employment adjustment subsidies. Moreover, if variable rentis accrued due to changes in GOP arising from revision of the employment adjustment subsidies, we will discusswith the tenant separately regarding the handling of such variable rent. In addition, GOP for the Sheraton
Grande Tokyo Bay Hotel has been multiplied by 49%, or INV’s ownership ratio of the preferred equity interest.
Hereinafter the same shall apply.
(Note 14) In accordance with the confirmation of the amount of employment adjustment subsidy received, we have revised
the GOP for the fiscal period ended June 2021 from JPY655 million to JPY652 million. However, there is nochange in variable rent for the fiscal period ended June 2021 as a result of this revision.
(Note 15) The GOP of the Cayman Hotels was USD -2,850,158 in the same period of 2021.
(c)

Overview of Fund Raising

As a result of the measures described below, INV’s interest-bearing debt outstanding balance was JPY 241,372 million
and the Interest-Bearing Debt ratio (Note 1) and LTV (appraisal value basis) (Note 2) were 49.2% and 44.9% respectively,
as of the end of the Reporting Period, with an average interest rate (Note 3) of 0.48%.
(Note 1)

(Note 2)(*)

(Note 3)

Interest-Bearing Debt ratio uses the calculation formula below:
Interest-Bearing Debt ratio = total outstanding interest-bearing debt (excluding short-term consumption tax
loans) / total assets x 100
LTV (appraisal value basis) uses the calculation formula below:
LTV = total outstanding interest-bearing debt (excluding short-term consumption tax loans) / total appraisal
value (*) x 100
Since appraisal value for Sheraton Grande Tokyo Bay Hotel (preferred equity interest) is not available, theacquisition price of the preferred equity interest (JPY 17,845 million) is deemed as appraisal value of Sheraton
Grande Tokyo Bay Hotel (preferred equity interest). The appraisal value of the Cayman Hotels is converted
into JPY amount via exchange rate of USD 1=JPY 110.45 based on the foreign exchange forward contracts
concluded on July 26, 2018 and executed on September 26, 2018.
The average interest rate (annual rate) is calculated by the weighted average based on the outstanding balanceof borrowings and rounded to two decimal places.

(i) Borrowing of Funds
INV borrowed Term Loan (001) on January 24, 2022 (total amount borrowed: JPY 1,700 million; interest rate: variableinterest rate of 1-month JPY TIBOR plus 0.25000% for a duration of one year), which was arranged by MUFG Bank,
Ltd. and Term Loan (002) on January 24, 2022 (total amount borrowed: JPY 6,800 million; interest rate: variable interest
rate of 1-month JPY TIBOR plus 0.25000% for a duration of one year), which was arranged by Sumitomo Mitsui Trust
Bank, Limited in order to repay Term Loan (I) in the amount of JPY 4,250 million, Term Loan in the amount of JPY
3,400 million and Term Loan (S) in the amount of JPY 850 million due on January 22, 2022.
Moreover, INV borrowed New Syndicate Loan (001) on March 14, 2022, March 29, 2022 and March 30, 2022, (total
amount borrowed: JPY 12,156 million; interest rate: variable interest rate of 1-month JPY TIBOR plus 0.25000% for aduration of one year), which was arranged by Mizuho Bank, Ltd. in order to repay New Syndicate Loan (G) in the amount- 16 -

of JPY 4,750 million due on March 14, 2022, one of the tranches of New Syndicate Loan (K) in the amount of JPY 7,922
million due on March 29, 2022 and New Syndicate Loan (T) in the amount of JPY 3,057 million due on March 30, 2022.
Furthermore, INV borrowed New Syndicate Loan (002) on March 30, 2022 (total amount borrowed: JPY 3,039 million;interest rate: variable interest rate of 1-month JPY TIBOR plus 0.25000% for a duration of one year), which was arranged
by Mizuho Bank, Ltd. in order to repay New Syndicate Loan (U) in the amount of JPY 3,039 million due on March 30,
2022.
In addition, INV borrowed Term Loan (003) on June 17, 2022 (total amount borrowed: JPY 2,349 million; interest rate:variable interest rate of 1-month JPY TIBOR plus 0.25000% for a duration of one year), which was arranged by Citibank,N.A., Tokyo Branch and Term Loan (004) on June 17, 2022 (total amount borrowed: JPY 1,000 million; interest rate:variable interest rate of 1-month JPY TIBOR plus 0.25000% for a duration of one year), which was arranged by
Development Bank of Japan, Inc. in order to repay Term Loan (U) in the amount of JPY 349 million due on June 15,2022, and Term Loan (J) in the amount of JPY 1,000 million, Term Loan (K) in the amount of JPY 1,000 million andTerm Loan (M) in the amount of JPY 1,000 million due on June 17, 2022.
(d)

Overview of Sale of Assets

INV completed the sale of trust beneficiary interests in six residential properties as follows on January 12, 2022.
Property
Number

Property Name

Acquisition
Price(JPY million)

Sale PriceBook Value(JPY million)(JPY million)(Note 2)
(Note 1)
(Note 3)

A79

Revest Honjin

674

569

A80

Revest Matsubara

657

559

A82

Alba Noritake
Shinmachi

608

509

A83

Revest Meieki
Minami

597

498

A88

Luna Court Edobori

525

457

A98

Little River
Honmachibashi

310

272

3,371

2,867

Total
(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)

Gain on Sale
(JPY million)(Note 2)
(Note 4)

Transferee(Note 5)

4,450

1,468

Kansai
Residence
Tokutei
Mokuteki
Kaisha

4,450

1,468

-

Book value shows a figure as of the date of sale.
Sale prices of individual properties are not disclosed as the transferee’s consent has not been obtained fordisclosure. Accordingly, gains on sales of individual properties are not disclosed, either.
Sale price shows a figure set forth in the purchase and sale agreement for the trust beneficiary interests, anddo not include transfer related cost, adjustments for property taxes and city planning taxes, or national or local
consumption taxes.
Gain on sale is calculated by deducting book value and transfer related cost from sale price.
INV does not have any capital, personnel or transactional relationship of note with the transferee. In addition,
the transferee is not related parties of INV/CIM. Furthermore, related persons and affiliates of the transferee
are not related parties of INV/CIM. Moreover, the transferee is not interested party, etc. of INV/CIM as
provided in Investment Trust Act.
Amounts are rounded down to the nearest million yen.

- 17 -

(e)Overview of Results of Operations and Distributions

As a result of the operations mentioned above, operating revenues for the Reporting Period decreased by JPY 726 million
from the previous period (-8.6%) to JPY 7,680 million, resulting in a net income of JPY 1,015 million, an increase of JPY
0.9 million from the previous period. Unappropriated retained earnings including the retained earnings carried forwardfrom the preceding fiscal period (JPY 8,664 million) is JPY 9,679 million. INV has decided to set distribution per unit
(excluding excess profit distribution) of JPY 166 without reversing retained earnings.

- 18 -

3

Changes in Total Number of Investment Units Issued and Outstanding

Changes in the number of investment units issued and outstanding and unitholders’ capital for the past five years up to the endof the Reporting Period are as follows.

Date

Type of issue

Total number of investment
units issued and outstanding(units) (units)
Increase
Total

Unitholders’ capital (JPY)
Increase

Total

Reference

October 12, 2017

Public offering

887,959

4,748,783

37,917,625,218

166,902,571,918(Note 1)

November 1, 2017

Third-party
allotment

44,3984,793,181

1,895,883,396

168,798,455,314(Note 2)

August 1, 2018

Public offering

909,524

5,702,705

40,280,089,388

209,078,544,702(Note 3)

August 21, 2018

Third-party
allotment

45,476

5,748,181

2,013,995,612

211,092,540,314(Note 4)

December 28, 2018

Retirement(81,341)

5,666,840-

211,092,540,314(Note 5)

July 18, 2019

Public offering

409,524

6,076,364

23,317,887,036

234,410,427,350(Note 6)

Third-party
20,476
6,096,840
1,165,882,964 235,576,310,314(Note 7)
allotment
Reversal of
allowance for
6,096,840
125,201,855 235,701,512,169(Note 8)August 22, 2019
temporarydifferences
adjustment(Note 1) New investment units were issued in a public offering at a price of JPY 44,118 per unit (JPY 42,702 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 2) New investment units were issued in a third-party allotment at a price of JPY 42,702 per unit for the purposeof allocation to cash reserves to be used as part of the funds for future acquisition of specified assets.
(Note 3) New investment units were issued in a public offering at a price of JPY 45,776 per unit (JPY 44,287 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 4) New investment units were issued in a third-party allotment at a price of JPY 44,287 per unit for the purposeof raising a part of the funds for the acquisition of new properties.
(Note 5) INV acquired own investment units from December 13, 2018 to December 18, 2018 (on a trade date basis)through the market purchase at Tokyo Stock Exchange based on a discretionary transaction contract with asecurities company.
INV resolved the retirement of all the acquired own investment units at the Board of Directors' Meeting held
on December 25, 2018 and the acquired own investment units were retired on December 28, 2018.
The acquisition of own investment units was conducted using capital surplus, and thus there is no change tounitholders’ capital.
(Note 6) New investment units were issued in a public offering at a price of JPY 58,898 per unit (JPY 56,939 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 7) New investment units were issued in a third-party allotment at a price of JPY 56,939 per unit for the purposeof raising a part of the funds for the acquisition of specified assets.
(Note 8) INV decided at the Board of Directors' Meeting held on August 22, 2019, the reversal of allowance fortemporary difference adjustments for incorporation into unitholders' capital.
August 15, 2019- 19 -

Trends in Trading Prices of Investment Securities
The highest and lowest prices (trading prices) in the Real Estate Investment and Trust Securities Section of the Tokyo Securities
Exchange on which the investment securities of INV are listed are as follows.
Real Estate Investment and Trust Securities Section, Tokyo Securities Exchange(Unit: JPY)
PeriodClosing month
HighestLowest34th fiscal
period35th fiscal
period36th fiscal
period37th fiscal
period38th fiscal
periodJune
2020
62,300December2020
39,800June
2021
47,650December
2021
45,800June
2022
45,80018,87023,50031,40034,45034,000- 20 -

4

Distribution PerformanceWith respect to distributions of earnings for the Reporting Period, INV decided that distribution per unit (excluding excess
profit distribution) is JPY 166 without reversing retained earnings.

PeriodCalculated Period
Unappropriatedretained earnings(JPY thousand)Reserved profit(JPY thousand)Total cash distribution(JPY thousand)(Distribution per unit)(JPY)
Total profit distribution(JPY thousand)(Profit distribution per
unit)
(JPY)
Total refund ofinvestment(JPY thousand)(Refund of investment
per unit)(JPY)
Total distribution fromthe allowance fortemporary differences
adjustment out of total
refund of investment(JPY thousand)(Distribution from theallowance fortemporary differences
adjustment per unit outof refund of investment
per unit) (JPY)
Total distribution fromunitholders’ equity
under the tax laws outof the total refund ofinvestment(JPY thousand)Distribution fromunitholders’ equity
under the tax laws outof refund of investment
per unit(JPY)

34th fiscal
periodJan. 1, 2020 toJun. 30, 2020

35th fiscal
periodJul. 1, 2020 toDec. 31, 2020

36th fiscal
periodJan. 1, 2021 toJun. 30, 2021

37th fiscal
periodJul. 1, 2021 to
Dec. 31, 2021

38th fiscal
periodJan. 1, 2022 toJun. 30, 2022

13,168,294

13,371,340

8,753,480

9,676,221

9,679,301

12,747,612

12,353,168

8,662,027

8,664,146

8,667,226

420,6811,018,172

91,452

1,012,075

1,012,075

69

167

15

166

166

420,6811,018,172

91,452

1,012,075

1,012,075

69

167

15

166

166

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

- 21 -

5

Future operational policy and issues to be addressed
Outlook for the Fiscal Periods Ending December 31, 2022
The Japanese economy is gradually recovering from the COVID-19 shock, but for the time being, prevention of the spreadof COVID-19 infections and activation of economic and social activities are required at the same time. The spread of
infections by new COVID-19 variants continues to be observed. In such an environment, it is necessary to closely
monitor the impacts of the pandemic in Japan and overseas, as well as fluctuations in the financial and capital markets.
In particular, it is necessary to pay attention to the rise in resource prices triggered by the situation in Ukraine and thedeterioration of consumer sentiment due to the rise in prices due to the yen depreciation.
In the hotel market, it is expected that inbound demand will recover as the government raises the daily cap on arrivals to
20,000 people per day (as of the date of this document). At the same time, the introduction of a nationwide travel discountsystem is expected to stimulate domestic tourism and business demand.
In the rental housing market, lifestyle changes due to the impact of COVID-19 infections are expected to affect tenant
trends, and INV will keep an eye on such trends.
(a)Future operational policy and issues to be addressed

Since July 2011, INV has focused on improving the profitability of its portfolio and strengthening its financial base inorder to enhance unitholder value with the Fortress Group as its sponsor. Fortress Group became a member of SoftBank
Group in December 2017 and SoftBank Group has owned 100% of issued shares of CIM directly and indirectly since
March 29, 2018. In addition to access to Fortress’ global real estate expertise, INV will collaborate with SoftBank Groupaffiliates that has cutting-edge expertise in various technology fields.
INV will pay attention to an asset management with an emphasis on customer safety and security in situations where
accommodation demand has declined drastically due to the impact of COVID-19, and focus on reviewing theoperational strategy to restore revenues from hotels. Going forward, INV will continue to implement various
strategies for further growth and financial stability, including the following measures.


Asset recycling: property acquisitions using the proceeds from sales
Internal growth at hotels through reducing costs, stimulating existing demand and creating new demand bycollaborating with hotel operators
Further internal growth at residential properties

Details of the future growth strategy are as follows.
(i)

External growth strategy
New Property Acquisitions

As its basic strategy, INV had moved forward with the acquisition of new properties focusing on hotels, where continued
growth in portfolio revenues would be anticipated and residential properties, especially where rental growth could beachieved, to build a portfolio with a good balance between growth and stability. However, for the time being, it isnecessary to carefully consider the acquisition of hotel properties, which have been greatly affected due to COVID-19
infections, while looking for the possibility of acquiring property at an attractive price.
In regard to hotels, INV will take into consideration demands of business and leisure customers in nearby areas, andleasing contract types when making investment decisions, with the aim of acquiring properties where growth and stabilityof GOP and rental revenue are forecasted to increase.
In regard to residential properties, INV will analyze occupancy rates, rental market trends, the presence of competing
properties among other factors, and consider acquiring properties with strong competitiveness, in which it believes it canachieve increases in rent.

- 22 -

Property Sales
INV considers the possibility of portfolio optimization upon consideration of the portfolio sector composition, geographic
distribution and competitiveness of each property as appropriate in the sluggish accommodation demand due to the impact
of COVID-19.
(ii)

Strategy for internal growth(Hotels)

Of the 84 domestic hotels (Note 1) owned by INV as of the end of the Reporting Period, 75 hotels use a variable rent
scheme. In the variable rent scheme, in principle, INV receives all of the gross operating profit (GOP) after deducting
payment of management fees for the hotel operator as rents. For 73 hotels of the 75 hotels, MHM and subsidiaries of
MHM have implemented sophisticated revenue management initiatives seeking to maximize revenue through effectively
taking in accommodation demand. As a result, INV can directly enjoy the hotel revenue upside through this variable
rent scheme.
In response to the reduction in hotel demand, the MHM Group is taking steps to reduce hotel operating expenses byreviewing its operational strategy. Specific measures include reduction of labor costs as well as taking government
subsidies, cutting payments to service providers such as cleaning vendors, reducing marketing expenses, utilities, andother items under the COVID-19 environment.
The MHM Group is vigorously working to stimulate demand from existing domestic customers by providing corporate
customers with diverse options including a new lineup of meeting options highlighting strict measures to reduce the spreadof COVID-19 while grasping changes in customer demand under the “With Corona” environment. In addition, the MHM
Group is focusing on creating new demand, including the provision of day-use and special successive stay for teleworking
to provide individuals and corporates with a comfortable telework space and expansion of delivery and take-out services
through directly managed restaurants in the hotel as well as accommodation demand associated with the voluntary
quarantine period after returning to Japan.
For hotels, renovation of rooms and replacement of fixtures and fittings are indispensable to maintain and increase
revenues and operate stably in a planned manner while considering the hotel profit situation, where demand has dropped
as described above.
(Note 1) Including Sheraton Grande Tokyo Bay Hotel (the preferred equity interest).

(Residential properties and others)
INV will continue to strengthen its collaborative ties with property managers and brokers to further boost occupancy rates
and earning capabilities of its properties. With respect to INV’s residential properties, INV will focus on increasing theoccupancy rates and rents for both new lease contracts and lease renewals for all its properties as well as formulating net
leasing cost reduction policies in order to continue maximizing profits.
Further, the implementation of appropriate maintenance and repair plans is of the utmost importance in maintaining andenhancing the competitiveness and market value of the properties as well as ensuring high tenant satisfaction. Therefore,
INV will continue to monitor current strategic plans with flexible implementation as it sees fit.

(iii) Financial strategy
The long-term issuer rating from Japan Credit Rating Agency, Ltd. (JCR) is “A” (Outlook: Stable) as of the date of thisdocument.
Still being affected by COVID-19 infections, INV has implemented initiatives that restrict an increase in interest payments
upon refinancing of existing borrowings and ensure refinancing for a time. Over the medium to long term, INV will
implement financial strategies such as reduction of borrowing costs, extension of average interest-bearing debt repayment
periods, diversification of loan maturity dates and financing measures.(iv) Compliance risk management- 23 -

While the executive director of INV concurrently serves as the representative director at CIM, two supervisory directors(an external attorney and an external certified public account) oversee the execution of the executive director’s duties via
the Board of Directors of INV.
CIM has a compliance officer who is responsible for compliance with laws, regulations and other relevant matters as well
as overall management of transactions with sponsor related parties. Moreover, it has in place a compliance committee
which, chaired by such compliance officer, is in charge of deliberating on compliance with laws, regulations and otherrelevant matters as well as transactions with sponsor related parties. Compliance committee meetings are attended byan outside expert (an attorney) who, sitting in as a compliance committee member, conducts rigorous deliberations on
the existence of conflicts of interest in transactions with sponsor related parties as well as strict examinations with respect
to INV’s compliance with laws and regulations. No resolution will be adopted unless the outside expert agrees.
When INV conducts certain transactions such as asset acquisition with sponsor related parties, prior approvals by the
Board of Directors of INV are required to ensure an objectivity in deliberation regarding conflicts of interests. In suchagenda, only two supervisory directors (a lawyer and a certified public accountant) will participate in the vote, and theexecutive director who concurrently serves as the representative director of CIM will not participate in the vote as he isa special interested party.
INV intends to continually take steps to strengthen its compliance structure.
(v)

Initiatives for Sustainability

INV and CIM recognize the importance of environmental, social, and governance (ESG) considerations in real estate
investment management from the viewpoint of sustainability such as economic and social development and contributing
to global environmental conservation, and regard improvement of sustainability as an important management issue.
INV and CIM believe that the incorporation of ESG considerations into the real estate investment management business,
which is our primary business, is essential to maximizing unitholder value over the medium to long term and contributes
to maximizing INV's investment returns.
Thus, INV and CIM have established a “Sustainability Policy” to set basic policies for sustainability and put them into
practice in our daily operations. Under this policy, CIM has formulated the “Energy Conservation Policy”, the“Greenhouse Gas Emissions Reduction Policy”, the “Water Saving Policy” and the “Waste Management Policy” which
stipulate efforts to reduce environmental impact. In addition, CIM are actively promoting environmental and social
initiatives related to INV’s properties. CIM has established the “Sustainable Procurement Policy” in order to promote
initiatives for ESG throughout the value chain of INV's real estate portfolio, concluded the “Green Lease” contract withtenants to collaborate with tenants on measures related to the environmental consideration of real estate, such as proactive
introductions of energy-saving equipment such as LED lighting, and conducted the “Tenant Satisfaction Survey” forresidents of INV’s residential properties to collect opinions and requests of residents and utilize them for asset
management. Furthermore, CIM conducts sustainability-focused training for all officers and employees, including
temporary staff, at least once a year, to help officers and employees acquire knowledge and raise awareness ofsustainability considerations in line with business practices. In addition, as an initiative for its employees, CIM conducts
an employee satisfaction survey once every three years with the aim of improving its working environment. CIM also
introduced paid vaccine leave so that officers and employees can receive COVID-19 vaccines and deal with any potential
side-effects.
As the COVID-19 pandemic continues, some hotels owned by INV (APA Hotel Yokohama-Kannai, Hotel MyStays Oita
and Comfort Hotel Kitami) have been used as accommodation and medical facilities for patients with mild symptoms orquarantine facilities for returnees from overseas in terms of social contributions. Also, meeting rooms at Hotel MyStays
Shin Osaka Conference Center were provided as a vaccination venue.
INV will continue to recognize its social responsibility to the environment and local communities as a J-REIT withhotels and residences as our core assets, and will proactively implement ESG-friendly investment management andsustainability initiatives that take advantage of asset characteristics and carry out social contribution activities.

- 24 -

6

Significant Subsequent Events
Not applicable. Reference information is stated below.
(Reference Information)(a)Debt Financing

INV decided to borrow New Syndicate Loan (003) and Term Loan (005) on July 14, 2022 in order to repay (i) New
Syndicate Loan (V) in the amount of JPY 40,024 million due on July 16, 2022, (ii) one of the tranches of New Syndicate
Loan (I) in the amount of JPY 9,660 million due on July 17, 2022 and (iii) Term Loan (N) in the amount of JPY 600
million, due on July 20, 2022.
(i)

New Syndicate Loan (003)
LenderBorrowing
Date

Outstanding
Balance(JPY million)

July 19,2022

49,684

Interest Rate(annual rate)

Maturity
Date

Borrowing
MethodJuly 19,2023

Unsecured/
non guarantee

Maturity
Date

Borrowing
MethodJuly 20,2025

Unsecured/
non guarantee

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Sumitomo Mitsui Trust Bank, Limited
Citibank, N.A., Tokyo Branch
Shinsei Bank, Limited

Floating
interest rates(Note 1)Development Bank of Japan, Inc.
Resona Bank, Limited
The Ogaki Kyoritsu Bank, Ltd.
(Note 1)(ii)

1-month JPY TIBOR (Base Rate) + spread (0.25000%)

Term Loan (005)
Lender

The Tokyo Star Bank, Limited(Note 1)

Borrowing
Date

Outstanding
Balance(JPY million)

July 20,2022

600

1-month JPY TIBOR (Base Rate) + spread (0.35000%)- 25 -

Interest Rate(annual rate)
Floating
interest rates(Note 1)

Overview of the Investment Corporation
1

Overview of Investment
By Period

34th fiscal
period35th fiscal
period36th fiscal
period37th fiscal
period38th fiscal
periodResults Dates

As of Jun. 30,
2020

As of Dec. 31,
2020

As of Jun. 30,
2021

As of Dec. 31,
2021

As of Jun. 30,
2022

10,000,000

10,000,000

10,000,000

10,000,000

10,000,000

6,096,840

6,096,840

6,096,840

6,096,840

6,096,840

Unitholders’ capital(JPY million)

235,701

235,701

235,701

235,701

235,701

Number of total
unitholders

42,43938,07433,747

31,23830,005

Number of issuable
investment units (Unit)
Number of investment
units issued andoutstanding(Unit)

2

Notes regarding Unitholders
Major unitholders at the end of the Reporting Period are as below.

Name

Number of units held

% of total number of investment
units issued and outstanding

The Master Trust Bank of Japan, Ltd. (trust
account)

1,258,688

20.64

Custody BANK of Japan, Ltd. (trust account)

928,125

15.22

311,267

5.10

287,054

4.70

DEUTSCHE BANK AG, SINGAPORE A/C
CLIENTS (TREATY)

195,675

3.20

THE BANK OF NEW YORK MELLON 140044

119,881

1.96

FJODF GP INV HOLDINGS LLC

115,9311.90

110,892

1.81

93,511

1.53

89,1031.46

3,510,127

57.57

The Nomura Trust and Banking Co., Ltd.
(investment trust account)
STICHTING PENSIOENFONDS ZORG ENWELZIJNSTATE STREET BANK AND TRUSTCOMPANY 505223
STATE STREET BANK WEST CLIENT TREATY 505234
JP MORGAN CHASE BANK 380072
Total(Note 1) Percentages are rounded down to two decimal places.

- 26 -

3

Notes regarding Directors
Directors at the end of the Reporting Period are listed below.

Position

Name

Concurrent responsibilities

Executive Director

Naoki Fukuda

President and CEO, Consonant
Investment Management Co., Ltd.
(current position)

Directors’ remuneration for
operating period(JPY thousand)-Attorney,
Shiba-Daimon Law Office
Yoshihiro Tamura

Statutory Auditor,
BEQONE PARTNERS, Inc.
(current position)

2,400

Certified Public Accountant,
CPA Fujimoto Office

Supervisory Director

Hiroyuki Fujimoto

Outside Auditor,
BRYCEN Co., Ltd.
(current position)

2,400

Outside Director, the Audit &Supervisory Committee Member,
NEO MARKETING INC.
(current position)
Auditor(Note1)

Ernst & Young
ShinNihon LLC-

17,700Executive and supervisory directors do not hold INV’s units either in their names or in the names of third
parties. In addition, while they may be directors of organizations not listed above, those organizations aswell as those listed above have no conflicts of interest with INV.

Determination policy for dismissal or non-reappointment of Auditor
The auditing agreement with the auditor is renewed every accounting period. Dismissals are made in accordance with theInvestment Trust Act, and in addition, non-reappointments are considered by the board of directors of INV by comprehensively
taking into account the auditing quality, auditor remuneration, and other various circumstances.

Notes regarding indemnification agreement between Directors and INV
Not applicable.

- 27 -

4

Notes regarding Directors Liability Insurance
Directors Liability Insurance concluded by INV is as below.
Insured Person

Overview of the Insurance Contract(Outline of insured event covered by insurance)
Damages and dispute costs incurred by the insured due to a claim fordamages caused by the insured’s actions as a director’s duties will becovered.

All Executive Directors andSupervisory Directors(Burden ratio of insurance premium)
INV bears the insurance premiums except those for the special contract ofunitholder derivative suits.
(Measures to ensure that duties are executed properly)
By excluding criminal acts such as bribery and damages of directors who
intentionally commit illegal acts from compensation, measures are taken sothat duties of directors are executed properly.

5

Asset Management Company, Asset Custody Companies, and General Administrative AgentsThe asset management company, asset custody companies, and general administrative agents at the end of the Reporting
Period are as below.
Delegation category

Name

Asset management company
Asset custody company

Consonant Investment Management Co., Ltd.
Sumitomo Mitsui Trust Bank, Limited

General administrative agent administration of unitholders’registry, etc.)
General administrative agent(institutional operations (Note 1))
General administrative agent(accounting operations, etc.)
Special account management company

Sumitomo Mitsui Trust Bank, Limited
Consonant Investment Management Co., Ltd.
Sumitomo Mitsui Trust Bank, Limited
Mitsubishi UFJ Trust and Banking Corporation
Limited (Note 2) / Sumitomo Mitsui Trust Bank,
Limited (Note 3)
Mizuho Bank, Ltd. / Sumitomo Mitsui Banking
Corporation

General administrative agent(Fiscal agent pertaining to investment corporation bonds,
etc.)(Note 1) (i) Tasks related to the running of general unitholders’ meetings for INV (excluding tasks related to the mailingof general unitholders’ meetings and the receipt and counting of voting forms), (ii) tasks related to the runningof the meetings of the Board of Directors of INV, and (iii) or tasks incidental or related to that mentioned in(i) or (ii) are delegated.
(Note 2) Conducts administrative tasks related to the creation, maintenance, and disposition of transfer savings accountregisters for special accounts of unitholders of the INV before the merger (former Tokyo Growth REIT
Investment Inc.) as well as tasks related to other transfer savings account registers.
(Note 3) Conducts administrative tasks related to the creation, maintenance, and disposition of transfer savings accountregisters for special accounts of unitholders of the former LCP as well as tasks related to other transfer savings
account registers.

- 28 -

Status of Investment Corporation’s Assets under Management
1

Composition of INV’s Assets

Type ofasset

Geographic area

Purpose(Note 1)
Greater Tokyo
Area (Note 3)
Major regional
citiesOverseas (Note 4)
Subtotal

Fiscal period ended December 31, 2021
(as of December 31, 2021)
Amount held
(JPY million)(Note 2)

Percentage of
total assets(%)

Fiscal period ended June 30, 2022
(as of June 30, 2022)
Amount held
(JPY million)(Note 2)

Percentage of
total assets
(%)

1

0.0

1

0.0

-

-

-

-

34,3096.933,892

6.9

34,311

6.9

33,893

6.9

34,311

6.9

33,893

6.9

Greater Tokyo area
Major regional
citiesSubtotal

28,7795.8

28,597

5.8

8,913

1.8

5,969

1.2

37,693

7.6

34,567

7.1

Greater Tokyo area
Real
Offices/Commercial Major regional
estate in
Facilities
citiestrust
Subtotal

-

-

-

-

1,649

0.3

1,621

0.3

Real
estateHotelsTotal real estate

Residences

1,649

0.3

1,621

0.3

168,540

34.1

167,68934.2

209,60942.4

208,004

42.4

378,14976.4

375,693

76.7

Total real estate in trust

417,492

84.4

411,882

84.0

Preferred equity interest (Note 5)

17,856

3.6

17,856

3.6

Deposits and other assets

25,1595.1

26,485

5.4

494,819100.0

490,118100.0(451,804)(91.3)(445,776)(91.0)

HotelsGreater Tokyo area
Major regional
citiesSubtotal

Total assets (Note 6)(Note 1)
(Note 2)

(Note 3)(Note 4)(Note 5)(Note 6)

“Greater Tokyo area” refers to Tokyo, Kanagawa, Chiba and Saitama.
“Amount held” is from the balance sheet as of the end of the Reporting Period (book value after depreciation forreal estate, leasehold and real estate in trust). The amounts held for hotels are calculated by including book valueof accompanying FF&E, in principle.
While Hotel MyStays Haneda is held as trust beneficiary interests, part of accompanying FF&E is held in kind,which falls under this category.
The Leasehold of the Cayman Hotels falls under the category of “Real estate” for “Overseas.” The leaseholdinterests are the rights equivalent to long-term real estate leasehold rights for buildings and land under the laws of
the Cayman Islands (Term: 99 years; annual lease payment: USD 1 or KYD 1). INV implemented an investment
structure change regarding “Westin Grand Cayman Seven Mile Beach Resort & Spa” and “Sunshine Suites Resort”
on May 9, 2019 (Cayman Island local time), a change from making investments based on the TK agreement todirectly owning the Leasehold of the Cayman Hotels, which are the underlying assets of the TK interest.
Preferred equity interest issued by Kingdom Special Purpose Company, with the Sheraton Grande Tokyo Bay Hotelas an underlying asset (asset in trust of trust beneficiary interest acquired by Kingdom Special Purpose Company,
which is the real estate that serves as the main source of revenue for Kingdom Special Purpose Company).
The figures indicated in parenthesis under “Total assets” show the amounts related to owned real estate (excluding
the amount of preferred equity securities owned).

- 29 -

2

Major Properties
The overview of INV’s major properties (top 10 properties by book value) (Note 1) at the end of the Reporting Period is
as below.

Name of property

Book value(JPY million)

Leasable area
Occupancy rate
Ratio of
Leased area(m2)(%)
rentalrevenue(m2)(Note 2)
(Note 3)(%) (Note 4)Main use

D200

Westin Grand Cayman Seven Mile
Beach Resort & Spa

28,497

21,528.23

21,528.23

100.0

-

Hotel

D43

Hotel MyStays Gotanda Station

26,194

10,137.88

10,137.88

100.0

2.3

Hotel

D60

Hotel MyStays Premier Akasaka

20,2228,620.69

8,620.69

100.0

1.3

Hotel

D44

Hotel Epinard Nasu

18,65437,702.33

37,702.33

100.0

8.1

Hotel

D61

Hotel MyStays Premier Sapporo Park

15,932

21,670.64

21,670.64

100.0

0.6

Hotel

D64

Hotel MyStays Sapporo Aspen

15,22615,313.17

15,313.17

100.0

0.7

Hotel

D50

Hotel MyStays Shin Osaka ConferenceCenter12,79513,026.99

13,026.99

100.0

1.5

Hotel

D47

Hotel MyStays Premier Kanazawa

12,471

13,250.03

13,250.03

100.0

1.8

Hotel

D82

Hotel MyStays Premier Narita

10,04636,519.70

36,519.70

100.0

3.3

Hotel

D51

Hotel MyStays Premier Omori

9,652

11,849.61

11,849.61

100.0

1.2

Hotel

Total

169,694

189,619.27

189,619.27

100.0

20.8

(Note 1)
(Note 2)
(Note 3)(Note 4)

Securities described in “6 Asset Portfolio of Securities” later in this document are excluded.
Leasable area of Westin Grand Cayman Seven Mile Beach Resort & Spa indicates the area subject tomanagement contract.
“Occupancy rate” is calculated by dividing the leased area by leasable area, and rounded to one decimal place.
“Ratio of rental revenue” are rounded to one decimal place.

- 30 -

3

Asset Portfolio of Real Estate, etc.
The portfolio of the properties (real estate and trust beneficiary interest in real estate) held by INV at the end of theReporting Period is as below.

Name of property

Location(Note 1)

Type of asset

A26

Nisshin Palacestage
Daitabashi

1-31-2 Izumi, Suginami-ku, Tokyo

A28

Growth Maison Gotanda

2-26-6 Nishi-Gotanda, Shinagawa-ku,
Tokyo

A29

Growth Maison Kameido

6-58-16 Kameido, Koto-ku, Tokyo

A30

Emerald House

3-27-18 Itabashi, Itabashi-ku, Tokyo

A32

Suncrest Shakujii-Koen

3-15-35 Takanodai, Nerima-ku, Tokyo

A33

Growth Maison ShinYokohama

3-16-2 Shin-Yokohama, Kohoku-ku,
Yokohama-shi, Kanagawa

A34

Belle Face UenoOkachimachi

1-27-10 Higashi-Ueno, Taito-ku,
Tokyo

A35

Grand Rire Kameido

3-39-12 Kameido, Koto-ku, Tokyo

A37

Growth Maison Yoga

1-15-15 Okamoto, Setagaya-ku, Tokyo

A38

Route Tachikawa

3-7-6 Nishikicho, Tachikawa-shi,
Tokyo

A39

Shibuya-Honmachi Mansion

2-35-2 Honmachi, Shibuya-ku, Tokyo

A40

City Heights Kinuta

4-13-15 Kinuta, Setagaya-ku, Tokyo

A41

Acseeds Tower
Kawaguchi- Namiki

2-5-13 Namiki, Kawaguchi-shi,
Saitama

A43

College Square Machida

3-4-4 Nakamachi, Machida-shi, Tokyo

A44

Belair Meguro

1-2-15 Meguro, Meguro-ku, Tokyo

A45

Wacore Tsunashima I

2-7-47 Tarumachi, Kohoku-ku,
Yokohama-shi, Kanagawa- 31 -

Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest
Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest
Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)

1,771.13

1,240

1,071

1,051.50

1,070

818

1,367.96

1,220

935

2,152.31

1,400

1,308

3,029.16

1,170

1,040

1,858.44

1,230

915

1,351.11

1,090

903

1,562.26

1,050

772

1,015.34812

712

1,368.57

684

632

1,167.50691

710

1,235.93588

654

1,210.74776

498

1,047.75

512554

557.05614

542

907.46546

515

Name of property

Location(Note 1)

Type of asset

A46

Foros Nakamurabashi

1-6-6 Kouyama, Nerima-ku, Tokyo

A47

Growth Maison Kaijin

5-29-51 Kaijin, Funabashi-shi, Chiba

A48

College Square Machiya

7-3-1 Arakawa, Arakawa-ku, Tokyo

A59

Towa City Coop
Shinotsuka II

5-49-7 Higashi-Ikebukuro, Toshima-ku,
Tokyo

A61

Bichsel Musashiseki

1-22-7 Sekimachi-Kita, Nerima-ku,
Tokyo

A63

Towa City Coop Sengencho

4-338-2 Sengencho, Nishi-ku,
Yokohama-shi, Kanagawa

A64Royal Park Omachi

2-11-10 Omachi, Aoba-ku, Sendai-shi,
Miyagi

A65

Lexington Square
Haginomachi

1-15-18 Haginomachi, Miyagino-ku,
Sendai-shi, Miyagi

A66

Visconti Kakuozan

2-44 Otanacho, Chikusa-ku, Nagoyashi, Aichi

A72

Lexington Square
Honjo Azumabashi

4-20-6 Higashi-Komagata, Sumida-ku,
Tokyo

A73

AMS TOWER Minami 6-Jo

2-5-15 Minami 6-Jo Nishi, Chuo-ku,
Sapporo-shi, Hokkaido

A84

Revest Heian

2-13-17 Heian, Kita-ku, Nagoya-shi,
Aichi

A87

Excellente Kagurazaka

128-1 Yamabukicho, Shinjuku-ku,
Tokyo, and other one parcel

A90

Queen’s Court Fukuzumi

1-3-10 Fukuzumi, Koto-ku, Tokyo

A92

Belair Oimachi

5-14-17 Higashi-Oi, Shinagawa-ku,
Tokyo

A93

Siete Minami-Tsukaguchi

3-18-29 Minami-Tsukaguchimachi,
Amagasaki-shi, Hyogo

A94

Prime Life Sannomiya
Isogami Koen

4-3-23 Isogamidori, Chuo-ku, Kobeshi, Hyogo

A96

Century Park Shinkawa 1bankan

4-1-2 Shinkawacho, Minato-ku,
Nagoya-shi, Aichi

A97

West Avenue

1-5-17 Nishi, Kunitachi-shi, Tokyo

A99

Prime Life Mikage

2-25-11 Mikage Tsukamachi,
Higashinada-ku, Kobe-shi, Hyogo

A101

Lieto Court Mukojima

5-45-10 Mukojima, Sumida-ku, Tokyo- 32 -

Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest(Note 4)Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)815.77609

494

2,040.27

535

526

871.35587

431

1,627.13

1,340

787

1,220.24856

567

3,426.36

1,500

998

1,929.59714

381

1,528.58445

256

705.75303

227784.74718

404

4,460.56

1,240

861

1,554.03

819

496

701.92781

490

765.18756

410

530.60635

379

1,020.86504

331

789.12539

325

1,477.62500

294794.80382

307

761.18388

260

2,940.20

2,230

1,595

Location(Note 1)Name of property

Type of asset

A102

Lieto Court Nishi-Ojima

2-41-14 Ojima, Koto-ku, Tokyo

A103

Royal Parks Momozaka

5-38 Fudegasakicho, Tennouji-ku,
Osaka-shi, Osaka

A104

Royal Parks Shinden

3-35-20 Shinden, Adachi-ku, Tokyo

A106

Royal Parks Seasir MinamiSenju

3-41-7 Minami-Senju, Arakawa-ku,
Tokyo

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Subtotal
B18

AEON TOWN Sukagawa

105 Furukawa, Sukagawa-shi,
Fukushima

Trust
beneficiaryinterest

Subtotal
D01

Hotel MyStays Kanda

1-2-2 Iwamotocho, Chiyoda-ku,
Tokyo

D02

Hotel MyStays Asakusa

1-21-11 Honjo, Sumida-ku, Tokyo

D03

Hotel MyStays Kyoto-Shijo

52 Kasabokocho, Higashiiru,
Aburanokoji, Shijyodori, Shimogyoku, Kyoto-shi, Kyoto

D04

MyStays Shin-Urayasu
Conference Center

2-1-4 Akemi, Urayasu-shi, Chiba

D05

Hotel MyStays Maihama

3-5-1 Tekkodori, Urayasu-shi, Chiba

D06

Hotel MyStays Premier
Dojima2-4-1 Sonezakishinchi, Kita-ku,
Osaka-shi, Osaka

D07

Hotel MyStays NagoyaSakae

2-23-22 Higashi-Sakura, Naka-ku,
Nagoya-shi, Aichi

D08

Hotel MyStays SakaisujiHonmachi

1-4-8 Awaji-machi, Chuo-ku, Osakashi, Osaka

D09

Hotel MyStays Yokohama

4-81 Sueyoshicho, Naka-ku,
Yokohama-shi, Kanagawa

D10

Hotel MyStays Nippori

5-43-7 Higashi-Nippori, Arakawa-ku,
Tokyo

D11

Hotel MyStays FukuokaTenjin-Minami

3-14-20 Haruyoshi, Chuo-ku,
Fukuoka-shi, Fukuoka

D12

Flexstay Inn Iidabashi

3-26 Shin-Ogawamachi, Shinjuku-ku,
Tokyo

D13

Hotel MyStays
Ueno Inaricho

1-5-7 Matsugaya, Taito-ku, Tokyo

D14

Flexstay Inn Shinagawa

1-22-19 Kita-Shinagawa, Shinagawaku, Tokyo

D15

Flexstay Inn Tokiwadai

1-52-5 Tokiwadai, Itabashi-ku, Tokyo- 33 -

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)

2,048.28

2,130

1,547

8,776.26

3,280

2,532

15,797.29

6,430

4,571

6,496.86

3,160

2,497

86,518.75

46,07434,56718,440.58

2,380

1,621

18,440.58

2,380

1,621

2,585.72

4,900

2,827

3,327.38

4,410

2,459

7,241.51

8,610

5,547

6,232.30

7,200

4,414

2,456.36

6,810

4,534

9,445.32

6,420

3,616

9,064.71

5,520

2,511

4,188.83

3,400

2,260

7,379.43

3,910

2,147

1,719.29

2,510

1,740

3,412.71

5,550

1,403

2,953.38

2,090

1,312

1,150.76

2,000

1,188

1,134.52

1,980

1,170

2,539.75

2,120

1,177

Name of property

Location(Note 1)

D16

Flexstay Inn Sugamo

3-6-16 Sugamo, Toshima-ku, Tokyo

D17

Hotel MyStays Otemae

1-3-2 Tokuicho, Chuo-ku, Osaka-shi,
Osaka

D18

Hotel MyStays
Kiyosumi Shirakawa

1-12-16 Tokiwa, Koto-ku, Tokyo

D19

Flexstay Inn Nakanobu P1

4-27-12 Futaba, Shinagawa-ku, Tokyo

D20

Flexstay Inn Nakanobu P2

4-27-8 Futaba, Shinagawa-ku, TokyoD21

APA Hotel
Yokohama-Kannai

3-37-2 Sumiyoshicho, Naka-ku,
Yokohama-shi, Kanagawa

D22

Hotel MyStays
Hakodate-Goryokaku

26-17 Honcho, Hakodate-shi,
Hokkaido

D23

Flexstay Inn Shirogane

5-10-15 Shirokane, Minato-ku, Tokyo

D24

Hotel MyStays Haneda

5-1-13 Haneda, Ota-ku, Tokyo

D25

Hotel MyStays Kameido P1

6-32-1 Kameido, Koto-ku, Tokyo

D26

Hotel MyStays Ueno
Iriyaguchi

5-5-13 Higashi-Ueno, Taito-ku, Tokyo

D27

Hotel MyStays Kameido P2

6-7-8 Kameido, Koto-ku, Tokyo

D28

Hotel MyStays Shimizu

1-23 Masagocho, Shimizu-ku,
Shizuoka-shi, Shizuoka

D29

Super Hotel Shinbashi/
Karasumoriguchi

5-16-4 Shinbashi, Minato-ku, Tokyo

D30

Flexstay Inn Higashi-Jujo

2-10-2 Nakajujo, Kita-ku, Tokyo

D31

Hotel MyStays Utsunomiya

2-4-1 Higashi-Shukugo, Utsunomiyashi, Tochigi

D32

Flexstay Inn KawasakiKaizuka

1-13-2 Kaizuka, Kawasaki-ku,
Kawasaki-shi, Kanagawa

D33

Comfort Hotel Toyama

1-3-2 Takara-machi, Toyama-shi,ToyamaD34

Flexstay Inn KawasakiOgawacho

15-9 Ogawacho, Kawasaki-ku,
Kawasaki-shi, Kanagawa

D35

Flexstay Inn Ekoda

8-6 Sakaecho, Nerima-ku, Tokyo

D36

Super Hotel Tokyo-JR
Tachikawa Kitaguchi

2-21-9 Akebonocho, Tachikawa-shi,
Tokyo

D37

Super Hotel JR Uenoiriyaguchi

7-9-14 Ueno, Taito-ku, Tokyo

Type of asset- 34 -

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)2,089.86

2,210

1,075

4,956.66

2,410

1,117

2,673.64

1,460

845

770.56803

548

391.49387

276

6,568.51

9,930

7,304

7,961.26

3,910

2,631

1,754.06

2,360

2,058

5,400.16

8,380

7,018

4,349.67

7,200

5,230

2,247.92

3,760

3,583

2,793.99

4,810

3,465

3,559.81

2,390

2,019

1,403.89

1,930

1,566

1,714.53

1,300

1,257

11,733.23

2,010

1,163

1,190.57

1,110

869

3,305.64

1,160

880

725.60890

856

3,932.93

4,580

4,731

1,832.97

1,210

1,063

1,279.16

1,180

1,051

Name of property

Location(Note 1)

Type of asset

D38

Hotel MyStays Shinsaibashi

1-9-30 Nishi-Shinsaibashi, Chuo-ku,
Osaka-shi, Osaka

D39

Comfort Hotel Kurosaki

3-13-13 Kurosaki, Yahatanishi-ku,
Kitakyusyu-shi, Fukuoka

D40

Comfort Hotel Maebashi

2-18-14 Omotecho, Maebashi-shi,
Gunma

D41

Comfort Hotel TsubameSanjo

2-115 Sugoro, Sanjo-shi, Niigata

D42

Comfort Hotel Kitami

3-4 Ohdori-Nishi, Kitami-shi,
Hokkaido

D43

Hotel MyStays Gotanda
Station (Note 5)

2-6-8 Nishi-Gotanda, Shinagawa-ku,
Tokyo

D44

Hotel Epinard Nasu

1-10 Kaidoue (and 59 other landparcels), Oaza-Takakuhei, Nasumachi, Nasu-gun, Tochigi

D45

Hotel MyStays Fukuoka
Tenjin3-5-7 Tenjin, Chuo-ku, Fukuoka-shi,
Fukuoka

D46

Hotel MyStays
Hamamatsucho

1-18-14 Hamamatsucho, Minato-ku,
Tokyo

D47

Hotel MyStays PremierKanazawa

2-13-5 Hirooka, Kanazawa-shi,Ishikawa

D48

Takamatsu Tokyu REI Hotel

9-9 Hyogomachi, Takamatsu-shi,
KagawaD49

Hotel MyStays Premier
Hamamatsucho

1-8-5 Hamamatsucho, Minato-ku,
Tokyo

D50

Hotel MyStays Shin Osaka
Conference Center

6-2-4 Nishinakashima, Yodogawa-ku,
Osaka-shi, Osaka and two other lots

D51

Hotel MyStays PremierOmori

6-11-2 Minami Oi, Shinagawa-ku,
Tokyo and 13 other lots

D52

Kamenoi Hotel Beppu(Note 6)2160-1 Chuocho, Beppu-shi, Oita and12 other lots

D53

Hotel MyStays Sapporo
Station4-15 Kita Hachijyo Nishi, Kita-ku,
Sapporo-shi, Hokkaido

D54

Hotel MyStays Yokohama
Kannai

5-65, Onoe-cho, Naka-ku, Yokohamashi, Kanagawa and 3 other lots

D55

Art Hotel Joetsu

5-1-11, Hon-cho Joetsu-shi, Niigata

D56

Art Hotel Hirosaki City

1-1-2, 1-6, 1-7, 2-1, Omachi, Hirosakishi, Aomori

D57

Hotel MyStays Oita

1-32, Niagemachi Oita-shi, Oita

D58

Hotel MyStays Gotanda

2-5-4, Higashigotanda Shinagawa-ku,
Tokyo

D59

Hotel MyStays Tachikawa

1-8-14, Nishiki-cho Tachikawa-shi,Tokyo- 35 -

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)

1,942.01

2,220

2,952

3,207.60

1,240

1,004

3,660.96

1,120

952

3,099.90

1,080

897

3,009.50

918

746

10,137.88

23,70026,19437,702.33

22,70018,654

5,083.06

7,990

7,696

1,951.90

6,130

7,783

13,250.03

12,80012,471

7,148.17

2,240

2,130

6,151.93

10,300

7,926

13,026.99

12,80012,795

11,849.61

9,640

9,652

19,422.08

8,670

7,680

7,267.88

8,180

7,499

4,501.18

5,250

5,084

7,563.60

2,690

2,572

14,826.30

2,710

2,473

3,254.69

1,560

1,448

1,839.77

3,930

4,038

3,844.64

3,320

3,170

Name of property

Location(Note 1)

D60

Hotel MyStays Premier
Akasaka

2-17-54, Akasaka Minato-ku, Tokyo

D61

Hotel MyStays Premier
Sapporo Park

2-2-10, Minamikujo Nishi, Chuo-ku,
Sapporo-shi, Hokkaido

D62

Hotel MyStays Ueno East

5-5-6, Higashi Ueno, Taito-ku, Tokyo

D63

Hotel MyStays Midosuji
Honmachi

3-2-10, Honmachi, Chuo-ku, Osakashi, Osaka

D64

Hotel MyStays
Aspen

5-1 Nishi 4-chome, Kita 8-jo, Kita-ku,
Sapporo-shi, Hokkaido, and sevenother lots

D65

Art Hotel Ishigakijima554-2 Nishimaji Okawa, Ishigaki‐shi,Okinawa, and four other lots

D66

Hotel MyStays Fuji Onsen
Resort2654 Arakura Deguchi, Fujiyoshidashi, Yamanashi, and 15 other lots

D67

Hotel Sonia Otaru

1-4-20 Ironai, Otaru-shi, Hokkaido

D68

Hotel MyStays Kanazawa
Castle10-17 Konohana-machi, Kanazawashi, Ishikawa

D69

Art Hotel Niigata Station

1-1 Sasaguchi, Chuo-ku, Niigata-shi,
Niigata

D70

Hotel MyStays
Nishiki

3-8-21 Nishiki, Naka-ku, Nagoya-shi,
Aichi

D71

Hotel Nord Otaru

1-4-16 Ironai, Otaru-shi, Hokkaido

D72

Hotel MyStays Kagoshima
Tenmonkan

2-7 Yamanokuchi-cho, Kagoshima-shi,
Kagoshima

D73

Art Hotel Asahikawa

6-29-2 7-jo-dori, Asahikawa-shi,
Hokkaido

D74

Hotel MyStays Matsuyama

1-10-10 Otemachi, Matsuyama-shi,
Ehime

D75

Hotel MyStays
Susukino

Sapporo

1-6 Nishi 5-Chome, Minami 7-jo,
Chuo-ku, Sapporo-shi, Hokkaido, andone other lot

D76

Hotel MyStays
Nakajima Park

Sapporo1-20 Nishi 1-chome, Minami 14-jo,
Chuo-ku, Sapporo-shi, Hokkaido

D77

Hotel MyStays Sapporo
Nakajima Park Annex

4-3 Nishi 1-chome, Minami 11-jo,
Chuo-ku, Sapporo-shi, Hokkaido

D78

Flexstay Inn Sakuragicho

2-72-2 Hanasaki-cho, Naka-ku,
Yokohama-shi, Kanagawa, and fourother lots

D79

MyCUBE by MYSTAYS
Asakusa Kuramae

2-6-7 Kuramae, Taito-ku, Tokyo

D80

Hotel MyStays Kagoshima
Tenmonkan Annex

1-20 Gofuku-machi, Kagoshima-shi,
Kagoshima

D81

Hotel MyStays Nayoro

11 Minami 5-chome, Nishi 3-jo,
Nayoro-shi, Hokkaido, and one otherlot

SapporoNagoyaType of asset- 36 -

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Leasable area(m2) (Note 2)

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)8,620.69

23,10020,222

21,670.64

16,20015,932

4,396.02

5,110

5,139

3,429.43

3,330

4,807

15,313.17

15,00015,226

17,247.54

9,310

9,470

5,498.49

9,770

8,773

6,509.41

5,720

5,578

5,931.84

5,430

5,597

10,403.01

5,350

5,307

6,077.99

5,010

5,068

6,047.43

4,050

4,134

7,659.55

3,400

3,340

25,131.84

3,090

2,895

8,274.37

3,170

2,843

2,853.26

2,920

2,982

5,473.41

1,980

2,024

1,775.21

1,520

1,517

1,308.61

1,420

1,391

2,156.70

1,240

1,262

2,047.70

1,190

1,151

1,985.27

930

880

Location(Note 1)Name of property

Trustbeneficiaryinterest
Trust
beneficiaryinterest

Hotel
NaritaD83

Art Hotel Morioka

3-3-18 Odori, Morioka-shi, Iwate

D200

Westin Grand Cayman
Seven Mile Beach Resort &Spa

30620 Seven Mile Beach Road, Grand
Cayman, Cayman Islands

The
Leasehold21,528.23

D201

Sunshine Suites Resort

1465 Esterley Tibbetts Highway,
Grand Cayman, Cayman Islands

The
Leasehold6,723.11(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)

Premier

Leasable area(m2) (Note 2)

D82(Note 1)MyStaysType of asset

40 Yokomine Oyama, Narita-shi,
Chiba, and 14 other lots

Appraisal value
as of the end ofBook value
the Reporting(JPY
Periodmillion)(JPY million)(Note 3)36,519.70

10,20010,046

16,727.08

5,400

5,341

45,719(USD 334,500
thousand)(Note 7)
8,200
(USD 60,000
thousand)(Note 7)28,497

5,394

Subtotal

572,519.79

481,758

409,587

Total

677,479.12

530,212445,776“Location” is, in principle, based on the indicated address (jyukyohyoji), except that if the jyukyohyoji system
has not been implemented for such property, the location is based on the land number (chiban).
Leasable areas of Westin Grand Cayman Seven Mile Beach Resort & Spa and Sunshine Suites Resort indicate
the areas subject to management contract.
“Appraisal value as of the end of the Reporting Period” is the value appraised or researched by Asset Researchand Development Inc., Japan Real Estate Institute, JLL Morii Valuation & Advisory K.K., The Tanizawa Sogo
Appraisal Co., Ltd., Daiwa Real Estate Appraisal Co., Ltd. or CBRE, Inc., in accordance with the Articles ofIncorporation of INV and the regulations of The Investment Trusts Association, Japan.
Individual trust beneficiary interests were integrated into three groups with other trust beneficiary interests
when INV procured funds through debt financing backed by trust assets in July 2011. As a result of
disposition of assets and detachment of trust beneficiary interest from an integrated trust account thereafter,
the grouping of trust beneficiary interests at the end of the Reporting Period is as follows:
Group 1
Nisshin Palacestage Daitabashi, Growth Maison Shin-Yokohama, Belle Face Ueno-Okachimachi, Growth
Maison Yoga, Shibuya-Honmachi Mansion, and Foros Nakamurabashi.
Group 2
College Square Machida, Belair Meguro, and Wacore Tsunashima I.
Group 3
Suncrest Shakujii-Koen, Grand Rire Kameido, Acseeds Tower Kawaguchi-Namiki, Growth Maison Kaijin,
and College Square Machiya.
“Appraisal value as of the end of the Reporting Period” indicates appraisal value calculated deeming theowned portion and the floor expansion portion as one.
The property name was changed from “Beppu Kamenoi Hotel” to “Kamenoi Hotel Beppu” on July 1, 2022
along with the change of the hotel name. Herein after the same.
“Appraisal value as of the end of the Reporting Period” is converted into JPY using the exchange rate of USD
1 = JPY 136.68, which is the exchange rate on the closing date of the fiscal period (June 30, 2022).

- 37 -

Trends for the leasing operations of the properties owned by INV are as below.

Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)Nisshin Palacestage
Daitabashi

1

75.1

34,792

0.6

1

90.4

33,594

0.6

A28 Growth Maison Gotanda

1

100.0

28,494

0.5

1

100.0

28,4910.5

A29

Growth Maison Kameido

1

95.4

34,391

0.6

1

95.4

34,9680.7

A30

Emerald House

1

97.0

41,506

0.7

1

100.0

46,3490.9

A32

Suncrest Shakujii-Koen

1

100.0

38,543

0.7

1

97.3

39,0380.8

A33

Growth Maison ShinYokohama

1

95.5

38,135

0.7

1

94.0

38,2470.7

A34

Belle Face UenoOkachimachi

1

95.5

31,891

0.5

1

100.0

33,227

0.6

A35Grand Rire Kameido

1

100.0

26,619

0.5

1

100.0

26,6190.5

A37Growth Maison Yoga

1

97.4

23,816

0.4

1

94.9

23,131

0.4

A38

Route Tachikawa

1

100.0

21,958

0.4

1

100.0

21,357

0.4

A39

Shibuya-Honmachi Mansion

1

98.1

20,167

0.3

1

95.4

20,8120.4

A40City Heights Kinuta

1

100.0

19,116

0.3

1

94.6

18,6460.4

A41

Acseeds Tower KawaguchiNamiki

1

91.2

25,535

0.4

1

94.7

25,652

0.5

A43

College Square Machida

1

100.0

16,609

0.3

1

100.0

16,6090.3

A44

Belair Meguro

1

76.0

14,625

0.3

1

96.0

14,4940.3

A45

Wacore Tsunashima I

1

82.0

17,200

0.3

1

90.0

18,5370.4

A46

Foros Nakamurabashi

1

91.2

18,784

0.3

1

92.2

18,9790.4

A47

Growth Maison Kaijin

1

100.0

23,348

0.4

1

97.7

23,282

0.4

A48

College Square Machiya

1

100.0

14,924

0.3

1

100.0

14,924

0.3

A59

Towa City Coop Shinotsuka
II

1

95.2

35,705

0.6

1

96.1

36,806

0.7

A61

Bichsel Musashiseki

1

97.2

22,896

0.4

1

94.4

23,8100.5

A63

Towa City Coop Sengencho

1

89.9

58,607

1.0

1

92.4

59,968

1.2

A64Royal Park Omachi

1

98.1

26,587

0.5

1

95.6

26,755

0.5

A65

Lexington Square
Haginomachi

1

100.0

18,091

0.3

1

100.0

18,131

0.3

A66

Visconti Kakuozan

1

65.7

8,634

0.1

1

78.3

9,273

0.2

A26

- 38 -Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)

A72

Lexington Square Honjo
Azumabashi

1

100.0

18,010

0.3

1

93.9

18,717

0.4

A73

AMS TOWER Minami 6-Jo

1

92.2

43,754

0.7

1

86.8

43,5920.8

A77

Invoice Shin-Kobe Residence(Note 4)--48,036

0.8

-

-

-

-

A78

Cosmo Court Motomachi(Note 4)--35,049

0.6

-

-

-

-

A79

Revest Honjin (Note 6)

1

80.1

28,932

0.5

-

-

1,170

0.0

A80

Revest Matsubara (Note 6)

1

83.0

25,013

0.4

-

-

1,407

0.0

A82

Alba Noritake Shinmachi(Note 6)1

97.2

26,309

0.5

-

-

1,510

0.0

A83

Revest Meieki Minami(Note 6)

1

77.4

22,598

0.4

-

-

1,324

0.0

A84

Revest Heian

1

95.2

23,738

0.4

1

98.4

23,7570.5

A85

Vendir Hamaotsu Ekimae(Note 4)--33,073

0.6

-

-

-

-

A86

Salvo Sala (Note 4)--

22,333

0.4

-

-

-

-

A87

Excellente Kagurazaka

1

94.1

18,167

0.3

1

100.0

19,5000.4

A88

Luna Court Edobori (Note 6)

1

86.0

20,107

0.3

-

-

961

0.0

A89

Winntage Kobe Motomachi(Note 4)--20,205

0.3

-

-

-

-

A90

Queen’s Court Fukuzumi

1

89.7

16,976

0.3

1

93.1

17,1380.3

A91

Corp Higashinotoin (Note 4)--

15,688

0.3

-

-

-

-

A92

Belair Oimachi

1

92.6

15,491

0.3

1

100.0

14,7700.3

A93

Siete Minami-Tsukaguchi

1

97.5

16,993

0.3

1

100.0

17,5220.3

A94

Prime Life Sannomiya
Isogami Koen

1

96.9

14,955

0.3

1

100.0

15,451

0.3

A95

HERMITAGE NANBA
WEST (Note 4)--

13,924

0.2

-

-

-

-

A96

Century Park Shinkawa 1bankan

1

90.9

18,035

0.3

1

95.5

17,7520.3

A97West Avenue

1

92.5

12,763

0.2

1

87.5

13,5160.3

A98

Little River Honmachibashi(Note 6)

1

96.9

13,990

0.2

-

-

674

0.0

A99

Prime Life Mikage

1

90.1

12,033

0.2

1

100.0

12,134

0.2

1

97.5

56,293

1.0

1

95.8

57,507

1.1

A101 Lieto Court Mukojima- 39 -Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)

A102 Lieto Court Nishi-Ojima

1

98.8

49,265

0.8

1

100.0

50,394

1.0

A103 Royal Parks Momozaka

1

95.7

161,517

2.8

1

93.1

161,720

3.1

A104 Royal Parks Shinden

1

100.0

221,351

3.8

1

100.0

220,978

4.3

1

92.9

119,893

2.1

1

94.7

119,314

2.3

47

94.6

1,805,491

30.9

41

96.0

1,502,530

28.9

A106

Royal Parks Seasir MinamiSenju
Subtotal

B17

Lexington Plaza Hachiman(Note 5)

-

-

6,288

0.1

-

-

-

-

B18

AEON TOWN Sukagawa

1

100.0

141,434

2.4

1

100.0

141,082

2.7

Subtotal

1

100.0

147,722

2.5

1

100.0

141,082

2.7

D01

Hotel MyStays Kanda

1

100.0

3,279

0.1

1

100.0

14,7400.3

D02

Hotel MyStays Asakusa

1

100.0

1,135

0.0

1

100.0

9,041

0.2

D03

Hotel MyStays Kyoto-Shijo

1

100.0

17,667

0.3

1

100.0

2,168

0.0

D04

MyStays Shin-Urayasu
Conference Center

1

100.0

27,070

0.5

1

100.0

49,8171.0

D05

Hotel MyStays Maihama

1

100.0

41,642

0.7

1

100.0

53,952

1.0

D06

Hotel MyStays Premier
Dojima1

100.0

35,926

0.6

1

100.0

40,1960.8

D07

Hotel MyStays NagoyaSakae

1

100.0

35,781

0.6

1

100.0

58,8501.1

D08

Hotel MyStays SakaisujiHonmachi

1

100.0

5,502

0.1

1

100.0

15,9480.3

D09

Hotel MyStays Yokohama

1

100.0

58,208

1.0

1

100.0

60,541

1.2

D10

Hotel MyStays Nippori

1

100.0

2,637

0.0

1

100.0

13,3500.3

D11Hotel MyStays FukuokaTenjin-Minami

1

100.0

7,332

0.1

1

100.0

16,6540.3

D12

Flexstay Inn Iidabashi

1

100.0

5,606

0.1

1

100.0

12,6380.2

D13Hotel MyStays
Ueno Inaricho

1

100.0

775

0.0

1

100.0

1,558

0.0

D14

Flexstay Inn Shinagawa

1

100.0

5,900

0.1

1

100.0

8,740

0.2

D15

Flexstay Inn Tokiwadai

1

100.0

2,685

0.0

1

100.0

16,8940.3

D16

Flexstay Inn Sugamo

1

100.0

2,739

0.0

1

100.0

8,350

0.2

D17

Hotel MyStays Otemae

1

100.0

6,249

0.1

1

100.0

11,611

0.2- 40 -Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)

D18

Hotel MyStays Kiyosumi
Shirakawa

1

100.0

7,274

0.1

1

100.0

5,744

0.1

D19

Flexstay Inn Nakanobu P1

1

100.0

973

0.0

1

100.0

4,216

0.1

D20

Flexstay Inn Nakanobu P2

1

100.0

907

0.0

1

100.0

1,925

0.0

D21

APA Hotel
Yokohama-Kannai

1

100.0

245,859

4.2

1

100.0

254,812

4.9

D22

Hotel MyStays HakodateGoryokaku

1

100.0

36,338

0.6

1

100.0

43,381

0.8

D23

Flexstay Inn Shirogane

1

100.0

1,755

0.0

1

100.0

8,871

0.2

D24

Hotel MyStays Haneda

1

100.0

83,899

1.4

1

100.0

60,337

1.2

D25

Hotel MyStays Kameido P1

1

100.0

20,930

0.4

1

100.0

41,2990.8

D26

Hotel MyStays Ueno
Iriyaguchi

1

100.0

3,573

0.1

1

100.0

1,589

0.0

D27

Hotel MyStays Kameido P2

1

100.0

16,376

0.3

1

100.0

27,1500.5

D28

Hotel MyStays Shimizu

1

100.0

37,561

0.6

1

100.0

31,8330.6

D29Super Hotel
Shinbashi/Karasumoriguchi

1

100.0

39,426

0.7

1

100.0

39,4260.8

D30

Flexstay Inn Higashi-Jujo

1

100.0

1,287

0.0

1

100.0

1,599

0.0

D31

Hotel MyStays Utsunomiya

1

100.0

40,274

0.7

1

100.0

58,471

1.1

D32

Flexstay Inn KawasakiKaizuka

1

100.0

1,423

0.0

1

100.0

10,6980.2

D33

Comfort Hotel Toyama

1

100.0

35,928

0.6

1

100.0

35,9280.7

D34

Flexstay Inn KawasakiOgawacho

1

100.0

592

0.0

1

100.0

11,4750.2

D35

Flexstay Inn Ekoda

1

100.0

16,834

0.3

1

100.0

34,314

0.7

D36Super Hotel Tokyo-JR
Tachikawa Kitaguchi

1

100.0

31,787

0.5

1

100.0

31,787

0.6

D37Super Hotel JR Uenoiriyaguchi

1

100.0

27,275

0.5

1

100.0

27,2750.5

D38

Hotel MyStays Shinsaibashi

1

100.0

1,655

0.0

1

100.0

0

0.0

D39

Comfort Hotel Kurosaki

1

100.0

35,271

0.6

1

100.0

35,271

0.7

D40

Comfort Hotel Maebashi

2

100.0

43,811

0.8

2

100.0

44,231

0.9

D41

Comfort Hotel TsubameSanjo

2

100.0

34,949

0.6

2

100.0

34,9490.7

D42

Comfort Hotel Kitami

1

100.0

26,103

0.4

1

100.0

26,103

0.5- 41 -Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)

D43

Hotel MyStays Gotanda
Station1

100.0

120,840

2.1

1

100.0

117,103

2.3

D44

Hotel Epinard Nasu

1

100.0

721,419

12.4

1

100.0

422,206

8.1

D45

Hotel MyStays Fukuoka
Tenjin1

100.0

23,715

0.4

1

100.0

34,3000.7

D46

Hotel MyStays
Hamamatsucho

1

100.0

12,359

0.2

1

100.0

22,6620.4

D47

Hotel MyStays PremierKanazawa

1

100.0

108,700

1.9

1

100.0

93,875

1.8

D48

Takamatsu Tokyu REI Hotel

2

95.8

96,949

1.7

2

95.8

98,336

1.9

D49

Hotel MyStays Premier
Hamamatsucho

1

100.0

45,784

0.8

1

100.0

36,2440.7

D50

Hotel MyStays Shin Osaka
Conference Center

1

100.0

69,590

1.2

1

100.0

79,332

1.5

D51

Hotel MyStays Premier
Omori

1

100.0

76,102

1.3

1

100.0

65,505

1.3

D52

Kamenoi Hotel Beppu

1

100.0

175,622

3.0

1

100.0

148,299

2.9

D53

Hotel MyStays Sapporo
Station1

100.0

27,148

0.5

1

100.0

41,1590.8

D54

Hotel MyStays Yokohama
Kannai1

100.0

51,472

0.9

1

100.0

60,617

1.2

D55

Art Hotel Joetsu

1

100.0

44,034

0.8

1

100.0

25,6330.5

D56

Art Hotel Hirosaki City

1

100.0

66,565

1.1

1

100.0

74,1191.4

D57

Hotel MyStays Oita

1

100.0

62,128

1.1

1

100.0

86,434

1.7

D58

Hotel MyStays Gotanda

1

100.0

17,302

0.3

1

100.0

22,3550.4

D59

Hotel MyStays Tachikawa

1

100.0

38,568

0.7

1

100.0

45,7760.9

D60

Hotel MyStays Premier
Akasaka
Hotel MyStays Premier
Sapporo Park

1

100.0

73,012

1.3

1

100.0

67,178

1.3

1

100.0

74,318

1.3

1

100.0

33,1350.6

D62

Hotel MyStays Ueno East

1

100.0

3,502

0.1

1

100.0

2,525

0.0

D63

Hotel MyStays Midosuji
HonmachiHotel MyStays Sapporo
Aspen

1

100.0

1,374

0.0

1

100.0

4,955

0.1

1

100.0

50,626

0.9

1

100.0

36,5590.7

D65

Art Hotel Ishigakijima

1

100.0

16,803

0.3

1

100.0

71,158

1.4

D66

Hotel MyStays Fuji Onsen
Resort1

100.0

86,961

1.5

1

100.0

64,5191.2

D67

Hotel Sonia Otaru

1

100.0

58,325

1.0

1

100.0

54,463

1.0

D61

D64

- 42 -Name of property

37th fiscal period(July 1, 2021 to December 31, 2021)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)38th fiscal period(January 1, 2022 to June 30, 2022)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 3)

D68

Hotel MyStays Kanazawa
Castle1

100.0

18,868

0.3

1

100.0

13,7450.3

D69

Art Hotel Niigata Station

1

100.0

95,290

1.6

1

100.0

66,547

1.3

D70

Hotel MyStays Nagoya
Nishiki

1

100.0

21,129

0.4

1

100.0

35,7950.7

D71

Hotel Nord Otaru

1

100.0

31,881

0.5

1

100.0

26,6300.5

D72

Hotel MyStays Kagoshima
Tenmonkan

2

100.0

65,305

1.1

2

100.0

53,343

1.0

D73

Art Hotel Asahikawa

1

100.0

16,102

0.3

1

100.0

0

0.0

D74

Hotel MyStays Matsuyama

1

100.0

24,021

0.4

1

100.0

16,291

0.3

Hotel MyStays Sapporo
Susukino
Hotel MyStays Sapporo
Nakajima Park
Hotel MyStays Sapporo
Nakajima Park Annex

1

100.0

5,426

0.1

1

100.0

792

0.0

1

100.0

2,728

0.0

1

100.0

0

0.0

1

100.0

3,397

0.1

1

100.0

0

0.0

Flexstay Inn Sakuragicho

1

100.0

12,995

0.2

1

100.0

19,6100.4

MyCUBE by MYSTAYS
Asakusa Kuramae
Hotel MyStays Kagoshima
Tenmonkan Annex

1

100.0

3,377

0.1

1

100.0

0

0.0

1

100.0

16,837

0.3

1

100.0

18,9980.4

D81

Hotel MyStays Nayoro

1

100.0

30,058

0.5

1

100.0

25,6490.5

D82

Hotel MyStays Premier
Narita1

100.0

279,103

4.8

1

100.0

171,085

3.3

D83

Art Hotel Morioka

1

100.0

82,664

1.4

1

100.0

29,916

0.6

Subtotal

8799.9

3,884,633

66.5

87

99.9

3,554,617

68.4

Total

135

99.2

5,837,847

100.0

129

99.4

5,198,229

100.0

D75
D76
D77
D78
D79
D80

(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)

“Occupancy rate” is calculated by dividing the leased area by leasable area.
“Occupancy rate” and “Ratio of rental revenue” are rounded to one decimal place.
“Rental revenue (during period)” indicates leasing operation revenues during the fiscal period for each
property and has been rounded down to the nearest thousand yen.
The trust beneficiary interests of Invoice Shin-Kobe Residence, Cosmo Court Motomachi, Vendir Hamaotsu
Ekimae, Salvo Sala, Winntage Kobe Motomachi, Corp Higashinotoin, and HERMITAGE NANBA WEST
were sold on December 22, 2021.
The trust beneficiary interests of Lexington Plaza Hachiman was sold on July 2, 2021.
The trust beneficiary interests of Revest Honjin, Revest Matsubara, Alba Noritake Shinmachi, Revest Meieki
Minami, Luna Court Edobori and Little River Honmachibashi were sold on January 12, 2022.

- 43 -

37th fiscal period
38th fiscal period(July 1, 2021 to December 31, 2021)(January 1, 2022 to June 30, 2022)
Management
Management
Occupancy
contract
Occupancy
contract
Ratio ofRatio of
Number ofrate
revenue
Number ofrate
revenuemanagement
management
tenants(at end of(duringtenants(at end of(during
contract
contract(at end of
period)period)(at end of
period)period)revenuerevenueperiod)(%)(JPY
period)
(%)
(JPY
(%)
(%)
(unit)(Note 1)
thousand)(unit)(Note 1)
thousand)(Note 2)
(Note 2)
(Note 2)
(Note 3)(Note 2)
(Note 3)(Note 4)(Note 4)

Name of property

D200

Westin Grand Cayman Seven
Mile Beach Resort & Spa

1

100.0

-

-

1

100.0

826,355

81.5

D201

Sunshine Suites Resort

1

100.0

9,817

-

1

100.0

187,435

18.5

Total

2

100.0

-

-

2

100.0

1,013,790

100.0(Note 1)
(Note 2)
(Note 3)(Note 4)4“Occupancy rate” is calculated using the area subject to management contract.
“Occupancy rate” and “Ratio of management contract revenue” are rounded to one decimal place.
“Management contract revenue” is converted to JPY using the exchange rate at the time of the transaction.
If hotel operating expenses exceed hotel operating revenues, the management contract revenue is set to JPY
0 and the excess amount is recorded as the management contract loss.

Asset Portfolio of Facilities Generating Renewable Energy, etc.
Not applicable

5

Asset Portfolio Including Rights to Operate Public Facilities, etc.
Not applicable

6

Asset Portfolio of Securities
The portfolio of the securities held by INV at the end of the Reporting Period is as below.

Name

Type

Preferred equity
securities in
Kingdom Special
Purpose Company(Note 1)
(Note 2)

Quantity Book value (JPY million)(units)Unit priceAmountFair value (JPY million) Valuation gainor loss
Unit priceAmount (JPY million)

Notes

Preferred equity 178,458
securities-

17,856-

17,5211)(334) (Note(Note 2)

Total-

17,856-

17,521(334)

Book value of the preferred equity securities that is classified as investment in affiliates indicates theacquisition cost.
INV owns 178,458 units of preferred equity securities issued by Kingdom Special Purpose Company(equivalent to 49.0% of preferred equity securities issued and outstanding after the issuance of the said
preferred equity securities), with the Sheraton Grande Tokyo Bay Hotel as an underlying asset.

- 44 -

7

Status of Contract Amount and Fair Value of Specified Transaction
As of the end of the Reporting Period, the contract amount and fair value of the outstanding transaction under the specified
transaction account of INV are as follows.
(Unit: JPY thousand)Category

Contract amount(Note 1)
Amounts due after
one yearTransaction type, etc.

Fair value(Note 2)Non-market
Interest rate swap
50,476,000
36,687,000
96,020Receive floating rate/pay fixed ratetransaction(Note 1) The contract amount, etc. for interest rate swap are stated based on a notional principal.
(Note 2) Estimation method for fair value
Interest rate swap: Estimated based on the price, etc. presented by the correspondent financial institutions.

8

Status of Other Assets
Real estate and trust beneficiary interests in real estate are listed together in “3 Asset Portfolio of Real Estate, etc.” above.
As of the end of the Reporting Period, there are no investments in specified assets that are significant investment targets
for INV outside of 3 and 6 above.

9

Assets Owned Outside of Japan or the Region
Assets owned outside of Japan or the region held by INV at the end of the Reporting Period are as below.

Country nameAmount held
(JPY million)(Note 1)

Appraisal value as of the end of
the Reporting Period (JPY million) (Note 2)
Percentage of
total assets (%)

No. ofproperties(properties)Japan429,740

494,137

90.2

126

The Cayman Islands

33,892

53,9209.8

2463,633

548,058

100.0

128

Total
(Note 1)

(Note 2)

“Amount held” is from the balance sheet (book value after depreciation for real estate and trust beneficiaryinterest in real estate; and book value for preferred equity securities with real estate as underlying assets) as ofJune 30, 2022.
“Appraisal value as of the end of the Reporting Period” indicates the real estate appraisal value as of June 30,
2022, or the research value stated in the real estate research report and the appraisal value of investment securities.
“Appraisal value as of the end of the Reporting Period” for preferred equity securities which INV holds in Japan
indicates acquisition cost since their fair value is deemed extremely difficult to value. “Appraisal value as ofthe end of the Reporting Period” for assets which INV holds in the Cayman Islands indicates the amountconverted to JPY using the exchange rate of USD 1 = JPY 136.68, which is the exchange rate on the closing dateof the fiscal period (June 30, 2022).

- 45 -

Capital Expenditures for Properties Held by INV
1Schedule for Capital Expenditures
The schedule for the principal capital expenditures for property maintenance construction, etc., as of the end of theReporting Period for the real estate-related assets owned by INV is as follows.
Estimated cost (JPY thousand)Name of property

D73 Art Hotel Asahikawa
Art Hotel Hirosaki
City

D56

2

D52

Kamenoi Hotel
Beppu

D51

Hotel MyStays
Premier Omori

D51

Hotel MyStays
Premier Omori

Location

PurposeScheduled time of
implementation

Total

Payment for
Advancethe Reporting
payments
PeriodAsahikawa-shi, Multistory parking
lot renovation work
Hokkaido

From July 2022
To December 2022

150,000--

Hirosaki-shi,
Aomori

From July 2022
To December 2022

139,168

23,852-

115,000--

85,000--40,673--Exterior wallrenovation work

Air conditioning
facility and hot water
From July 2022
Beppu-shi,
system renovation
To December 2022
Oita
work for energy
savingAutomatic fire alarm
From July 2022
Shinagawa-ku,
system renovationTo
December 2022
Tokyo
work
Air conditioning
From July 2022
Shinagawa-ku,
facility renovationTo
December 2022
Tokyo
work (1F and 2F)

Capital Expenditures for the Reporting Period
The principal construction work constituting capital expenditures for the real estate assets for the Reporting Period is asfollows. Capital expenditures for the Reporting Period totaled JPY 605,359 thousand, and together with JPY 38,469
thousand in repair costs included in this fiscal period’s expenses, construction work totaling JPY 643,828 thousand was
implemented.
Name of property

Location

PurposeTime of implementation

Payment(JPY thousand)

D48

Takamatsu Tokyu Takamatsu-shi,
REI Hotel
KagawaWater tank renovation
work

From January 2022
To June 2022

68,420D44

Hotel Epinard
Nasu

Nasu-gun,Tochigi

Bakery and coffee shop
renovation work

From January 2022
To June 2022

45,811

D06

Hotel MyStays
Premier Dojima

Osaka-shi, Osaka B1 floor renovation work

From January 2022
To June 2022

33,346

D69

Art Hotel Niigata
StationNiigata-shi,
Niigata

Wi-fi equipment
renovation work

From January 2022
To June 2022

12,200

D201

Sunshine Suites
ResortGrand Cayman,
Cayman Islands

Firefighting equipment
renovation work

From January 2022
To June 2022

8,521

Other construction

437,060
Total

605,359- 46 -

3

Reserved Funds for Long-Term Maintenance Plan (repair reserves)

INV has reserved funds from the cash flow of the fiscal period, as shown below, towards large-scale
maintenance repairs in the medium- to long-term in accordance with the long-term maintenance plan for each
property.

Fiscal period(Unit: JPY thousand)
34th
35th
36th
37th
38th
fiscal period
fiscal period
fiscal period
fiscal period
fiscal period
From January 1, From July 1, 2020 From January 1, From July 1, 2021 From January 1,
2020 to June 30, to December 31, 2021 to June 30, to December 31, 2022 to June 30,
2020
2020
2021
2021
2022

Reserved funds at beginning2,543,226
5,485,363
2,610,671
2,749,724
2,791,578
of period
Amount reserved
737,8813,908,773
565,299546,287645,507(Note 1)
Amount reversed
503,667
966,6363,439,991
407,235
603,652(Note 1)
Amount carried over for
3,025,792
5,485,363
2,610,671
2,749,724
2,791,578
next fiscal period(Note 1) The amount reserved for the relevant fiscal period includes the reserves for acquired properties, and theamount reversed includes the reserves for sold properties.

- 47 -

Overview of Expenses and Liabilities
1

Statement of Operating Expenses
37th fiscal period
July 1, 2021 to December 31, 2021
300,000
24,73254,7204,800
242,924
627,177

Item(a) Asset management fees(b) Asset custody fees(c) Administrative services fees(d) Directors’ compensation(e) Other
Total

2(JPY thousand)38th fiscal period
January 1, 2022 to June 30, 2022
300,000
24,556
42,6184,800
152,051
524,026

Borrowing Conditions

Borrowing conditions by financial institution at the end of the Reporting Period are as below.
Type

LenderSumitomo Mitsui Trust
Bank, Limited

Balance atBalance at
Borrowing beginning of end of Reportingdate
Reporting Period
Period(JPY thousand) (JPY thousand)Jan. 22,2021
Jan. 22,2021

3,400,000-

850,000-

1,215,500-

199,000-

447,500-

25,000-

The Bank of Fukuoka, Ltd.
The Nomura Trust andBanking Co., Limited
The Shizuoka Bank, Ltd.

525,000-

270,000-

375,000-

Mizuho Bank, Ltd.

902,000-

692,000-

681,000-

617,000-

147,000-

349,000-

Mizuho Bank, Ltd.

5,992,000

5,992,000

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

6,660,000

6,660,000

4,442,000

4,442,000

2,670,000

2,670,000

3,000,000

3,000,000

3,330,000

3,330,000

1,335,000

1,335,000

MUFG Bank, Ltd.
Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited

MUFG Bank, Ltd.
Short-term Sumitomo Mitsui Banking
loans
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofJapan, Inc.
Citibank, N.A., Tokyo
BranchResona Bank, Limited

Mar. 30,2021

Mar. 30,
2021

Jun. 15,2021

Jul. 16,2021- 48 -

Averageinterest
Repayment Repayment
rate
PurposeNotes
datemethod(%)(Note 1)
Unsecured /Jan. 22,0.335(Note 3) (Note 2) with no2022
guarantee
Unsecured /Jan. 22,0.335(Note 3) (Note 2) with no2022
guarantee

0.325

Mar. 30,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.325

Mar. 30,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Jun. 15,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Jul. 16,2022(Note 3)(Note 2)

Unsecured /with noguarantee

Type

LenderBalance atBalance at
Borrowing beginning of end of Reportingdate
Reporting Period
Period(JPY thousand) (JPY thousand)

Mizuho Bank, Ltd.

2,442,000

2,442,000

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

2,220,000

2,220,000

1,998,000

1,998,000

Jul. 19,2021

890,000

890,000

1,000,000

1,000,000

1,110,000

1,110,000

666,000

666,000

Mizuho Bank, Ltd.

766,000

766,000

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

467,000

467,000

766,000

766,000

120,000

120,000

150,000

150,000

3,000,000

3,000,000

2,521,500

2,521,500

2,133,000

2,133,000

2,521,500

2,521,500

1,000,000

1,000,000

684,000

684,000

500,000

500,000

137,000

137,000

328,500

328,500

328,500

328,500

560,000

560,000

667,000

667,000

320,000

320,000

150,000

150,000

Mizuho Bank, Ltd.

190,000

190,000

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofJapan, Inc.

146,000

146,000

143,000

143,000

130,000

130,000

30,00030,000Development Bank ofJapan, Inc.

Sumitomo Mitsui Banking
Corporation

Jul. 20,2021

Aug. 2,
2021

Sep. 14,2021

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Development Bank ofJapan, Inc.
The Nomura Trust andShort-term Banking Co., Limited
loans
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Resona Bank, Limited
The Nomura Trust andBanking Co., Limited
The Bank of Fukuoka, Ltd.

Sep. 27,2021

Oct. 13,2021

Oct. 13,
2021

Averageinterest
Repayment Repayment
rate
Purposedate
method(%)(Note 1)

0.332

Jul. 16,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Jul. 16,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Jul. 16,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Sep. 14,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Sep. 27,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Sep. 27,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Sep. 27,2022(Note 3)(Note 2)

Unsecured /with noguarantee(Note 2)

Citibank, N.A., Tokyo
BranchOct. 13,2021

1,256,000

1,256,000

0.332

Sep. 27,2022(Note 3)

Mizuho Bank, Ltd.

Nov. 29,2021

4,321,000

4,321,000

0.332

Nov. 29,2022(Note 3)

MUFG Bank, Ltd.

Jan. 24,2022-

1,700,000

0.332

Jan. 24,2023(Note 3)

Sumitomo Mitsui Trust
Bank, Limited

Jan. 24,2022-

6,800,000

0.332

Jan. 24,2023(Note 3)-

1,733,000-

200,000

0.332

Mar. 14,2023(Note 3)-333,000

Mizuho Bank, Ltd.
The Shizuoka Bank, Ltd.
The Bank of Fukuoka, Ltd.

Mar. 14,2022- 49 -

Notes

Unsecured /with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee(Note 2)

Unsecured /with noguarantee

Type

Balance atBalance at
Borrowing beginning of end of Reportingdate
Reporting Period
Period(JPY thousand) (JPY thousand)LenderMizuho Bank, Ltd.

-386,000

MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Development Bank ofJapan, Inc.
The Shizuoka Bank, Ltd.

-

1,275,000-

2,100,000

Mar. 29,2022

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
The Nomura Trust andShort-term Banking Co., Limitedloans
The Shizuoka Bank, Ltd.

Mar. 30,2022-

297,000-

1,000,000-

1,270,000-

1,215,500-

199,000-

447,500-

800,000

Averageinterest
Repayment Repayment
rate
Purposedate
method(%)(Note 1)

0.332

Mar. 14,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Mar. 14,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.332

Mar. 14,2023(Note 3)(Note 2)

Unsecured /with noguarantee(Note 3)(Note 2)-375,000

The Bank of Fukuoka, Ltd.

-525,000

Mizuho Bank, Ltd.

-902,000-

692,000-

681,000-

617,000-

147,000-

2,349,000

0.332

-

1,000,000

0.332

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofJapan, Inc.
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.

Mar. 30,
2022

Jun. 17,2022
Jun. 17,2022

Subtotal

71,786,000

88,135,000

Mizuho Bank, Ltd.

1,733,000-

Resona Bank, Limited

333,000-

The Bank of Fukuoka, Ltd.
The Nomura Trust andBanking Co., Limited
AEON Bank, Ltd.

333,000-

333,000-

900,000-

The Towa Bank, Ltd.

253,000-

The Shizuoka Bank, Ltd.
The Daiichi Life InsuranceCo., Ltd.
The Gunma Bank, Ltd.

200,000-

500,000-

165,000-

Mizuho Bank, Ltd.
Long-term Sumitomo Mitsui Trust
Bank, Limited
loans（Note 4） Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchResona Bank, Limited
Development Bank ofJapan, Inc.
The Bank of Fukuoka, Ltd.

500,000

500,000

500,000

500,000

500,000

500,000

355,000

355,000

355,000

355,000

333,000

333,000

AEON Bank, Ltd.
The Nomura Trust andBanking Co., Limited
The Hiroshima Bank, Ltd.
The Daiichi Life InsuranceCo., Ltd.

Mar. 14,2017

Oct. 13,2017

1,500,000

1,500,000

300,000

300,000

190,000

190,000

166,000

166,000

166,000

166,000

500,000

500,000- 50 -

Notes

Jun. 17,2023
Jun. 17,2023(Note 3)

Unsecured /with noguarantee
Unsecured /(Note 2) with noguarantee

0.675

Mar. 14,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.682

Oct. 13,2022(Note 3)(Note 2)

Unsecured /with noguarantee

Type

LenderMizuho Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Banking
Corporation
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
MUFG Bank, Ltd.

Balance atBalance at
Borrowing beginning of end of Reporting
Reporting Period
Perioddate(JPY thousand) (JPY thousand)Oct. 13,2017

Oct. 13,2017

Jun. 27,2018

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchSumitomo Mitsui Trust
Bank, Limited
Long-term Mizuho Bank, Ltd.
loans
（Note 4） MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchSumitomo Mitsui Trust
Bank, Limited
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
Resona Bank, Limited
The Nomura Trust andBanking Co., Limited
AEON Bank, Ltd.

Jul. 17,
2018

Jul. 17,2018

Sep. 26,2018

1,250,000

1,250,000

1,065,000

1,065,000

1,250,000

1,250,000

1,250,000

1,250,000

1,060,000

1,060,000

1,250,000

1,250,000

1,000,000

1,000,000

500,000

500,000

2,443,000

2,443,000

2,220,000

2,220,000

1,997,000

1,997,000

1,110,000

1,110,000

1,000,000

1,000,000

890,000

890,000

2,442,000

2,442,000

2,220,000

2,220,000

1,997,000

1,997,000

1,110,000

1,110,000

1,000,000

1,000,000

890,000

890,000

3,287,000

3,287,000

3,287,000

3,287,000

2,600,000

2,600,000

1,000,000

1,000,000

833,000

833,000

667,000

667,000

500,000

500,000

445,000

445,000

167,000

167,000

334,000

334,000- 51 -

Averageinterest
Repayment Repayment
rate
Purposedate
method(%)(Note 1)

Notes

0.782

Oct. 13,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.882

Oct. 11,2024(Note 3)(Note 2)

Unsecured /with noguarantee

0.750

Jun. 27,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.482

Jul. 17,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.582

Jul. 14,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.482

Sep. 26,
2022(Note 3)(Note 2)

Unsecured /with noguarantee

Type

LenderMizuho Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
Resona Bank, Limited
The Nomura Trust andBanking Co., Limited
AEON Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Mizuho Bank, Ltd.

Balance atBalance at
Borrowing beginning of end of Reportingdate
Reporting Period
Period(JPY thousand) (JPY thousand)Sep. 26,
2018

Jan. 22,2019

MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Resona Bank, Limited
Development Bank ofLong-term Japan, Inc.
loans
The Bank of Fukuoka, Ltd.
（Note 4）The Shizuoka Bank, Ltd.
The Nomura Trust andBanking Co., Limited
The Senshu Ikeda Bank, Ltd.

Mar. 29,2019

3,287,500

3,287,500

2,600,000

2,600,000

1,000,000

1,000,000

833,000

833,000

667,000

667,000

500,000

500,000

445,000

445,000

166,000

166,000

333,000

333,000

850,000-

3,400,000-

386,000-

1,275,000-

2,100,000-

500,000-

500,000-

1,000,000-

333,000-

1,270,000-

270,000-(Note 3)(Note 2)

0.373

Jan. 22,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.361

Mar. 29,2022(Note 3)(Note 2)

Unsecured /with noguarantee

0.594

Mar. 29,2024(Note 3)(Note 2)

Unsecured /with noguarantee(Note 2)-921,000

921,000

480,000

480,000

961,000

961,000

0.882

Mar. 29,2029(Note 3)

Jun. 17,2019

1,000,000

-

0.340

Jun. 17,2022(Note 3)

Jun. 28,2019

1,000,000

-

0.334

Jun. 17,2022(Note 3)

571,400

571,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

0.400

Jan. 16,2023(Note 3)1,000,000

1,000,000

200,000

200,000

600,000

600,000

Kiraboshi Bank, Ltd.
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
Mizuho Bank, Ltd.

Jul. 16,2019- 52 -

Unsecured /with noguarantee

Sep. 26,2023

1,000,000

Mar. 29,
2019

Notes

0.582

288,000
Mar. 29,
2019

Resona Bank, Limited

3,287,500

1,000,000

Aozora Bank, Ltd
The Nishi-Nippon City
Bank, Ltd.
The Tochigi Bank, Ltd.

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

3,287,500

Averageinterest
Repayment Repayment
rate
Purposedate
method(%)(Note 1)

Unsecured /with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee(Note 2)

Unsecured /with noguarantee

Type

LenderBalance atBalance at
Borrowing beginning of end of Reportingdate
Reporting Period
Period(JPY thousand) (JPY thousand)

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

Jul. 16,2019

571,400

571,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

1,000,000

1,000,000

200,000

200,000

Resona Bank, Limited

600,000

600,000

Mizuho Bank, Ltd.

1,171,400

1,171,400

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchShinsei Bank, Limited

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

1,000,000

1,000,000

Jul. 16,2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited

Jul. 16,2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Long-term
Sumitomo Mitsui Banking
loans（Note 4） Corporation
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited

Jul. 16,2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
AEON Bank, Ltd.
The Nomura Trust andBanking Co., Limited
Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
AEON Bank, Ltd.
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.

Jul. 19,2019

Jul. 19,2019

200,000

200,000

2,171,400

2,171,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

200,000

200,000

2,170,400

2,170,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

200,000

200,000

1,085,000

1,085,000

987,000

987,000

987,000

987,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

712,000

712,000

986,000

986,000

986,000

986,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

237,000

237,000- 53 -

Averageinterest
Repayment Repayment
rate
date
method(%)(Note 1)

Purpose

Notes

0.499

Jan. 16,2024(Note 3)(Note 2)

Unsecured /with noguarantee

0.563

Jul. 16,2024(Note 3)(Note 2)

Unsecured /with noguarantee

0.632

Jan. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee

0.782

Jul. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee

0.413

Jan. 16,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.525

Jan. 16,2024(Note 3)(Note 2)

Unsecured /with noguarantee

Type

LenderMizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
AEON Bank, Ltd.
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd..,

Average
Balance atBalance at
Borrowing beginning of end of Reporting interest
Repayment Repayment Purpose
rate
date
Reporting Period
Perioddatemethod(%)(JPY thousand) (JPY thousand) (Note 1)
712,000
712,000

Jul. 19,2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofJapan, Inc.
AEON Bank, Ltd.
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.

Jul. 19,2019

Mizuho Bank, Ltd.
Long-term MUFG Bank, Ltd.
loans
(Note 4) Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofJapan, Inc.
AEON Bank, Ltd.
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.
Tokyo Star Bank, Limited
Mizuho Bank, Ltd.
San ju San Bank,Ltd.

Jul. 19,2019

Jul. 22,2019
Aug. 28,2019

986,000

986,000

986,000

986,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000

1,212,000

1,212,000

986,000

986,000

986,000

986,000

684,000

684,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000

1,211,000

1,211,000

986,000

986,000

986,000

986,000

684,000

684,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000

700,000

700,000

2,882,000

2,882,000

662,000

662,000

0.580

Jul. 16,2024(Note 3)(Note 2)

Unsecured /with noguarantee

0.632

Jan. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee

0.782

Jul. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee

0.782

Jul. 16,2025(Note 3)(Note 2)

0.462

Jan. 16,2024(Note 3)

San ju San Bank,Ltd.

Oct. 15,2019

1,700,000

1,700,000

0.486

Apr. 15,2024(Note 3)

San ju San Bank,Ltd.

Oct. 15,2019

1,000,000

1,000,000

0.632

Apr. 15,2025(Note 3)

The Nishi-Nippon City
Bank, Ltd.

Oct. 15,2019

1,000,000

1,000,000

0.782

Oct. 15,2025(Note 3)

Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited
Momiji Bank,Ltd.

Jan. 6,2020

1,550,000

1,550,000

0.417

Jan. 6,2023(Note 3)3,050,000

3,050,000

961,000

961,000

0.643

Jan. 6,2025(Note 3)480,000

480,000

The Kiyo Bank

Jan. 6,2020- 54 -

Notes

Unsecured /with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee(Note 2)

Unsecured /with noguarantee

Type

LenderMizuho Bank, Ltd.
Resona Bank, Limited
Development Bank ofJapan, Inc.
The Bank of Fukuoka, Ltd.
The Nomura Trust andBanking Co., Limited
The Shizuoka Bank, Ltd.

Average
Balance atBalance at
Borrowing beginning of end of Reporting interest
Repayment Repayment Purpose
rate
date
Reporting Period
Perioddatemethod(%)(JPY thousand) (JPY thousand)(Note 1)
634,000
634,000

Mar. 16,
2020

The Yamaguchi Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
The Bank of Fukuoka, Ltd.

Mar. 30,
2020

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Long-term Sumitomo Mitsui Trust
Bank, Limited
loans(Note 4) Shinsei Bank, Limited
Resona Bank, Limited
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.

Mar. 30,2020

300,000

300,000

1,000,000

1,000,000

333,000

333,000

333,000

333,000

200,000

200,000

411,000

411,000

850,000

850,000

1,090,000

1,090,000

333,000

333,000

582,000

582,000

628,000

628,000

1,090,000

1,090,000

570,000

570,000

500,000

500,000

270,000

270,000

1,000,000

1,000,000

The Shizuoka Bank, Ltd.

270,000

270,000

The Kagawa Bank, Ltd.

500,000

500,000

The Yamaguchi Bank, Ltd.

550,000

550,000

The Chukyo Bank, Ltd.

961,000

961,000

0.487

Mar. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee

0.382

Mar. 16,2023(Note 3)(Note 2)

Unsecured /with noguarantee

0.582

Mar. 16,2025(Note 3)(Note 2)

Unsecured /with noguarantee(Note 2)

Citibank, N.A., Tokyo
BranchJun. 15,2020

1,000,000

-

0.322

Jun. 17,2022(Note 3)

Tokyo Star Bank, Limited

Jul. 20,2020

600,000

600,000

0.332

Jul. 20,2022(Note 3)

Tokyo Star Bank, Limited

Jul. 20,2021

1,582,000

1,582,000

0.432

Jul. 20,2024(Note 3)

Subtotal

164,959,000

145,037,000

Total

236,745,000

233,172,000(Note 1)

Notes

Unsecured /with noguarantee
Unsecured /(Note 2) with noguarantee
Unsecured /(Note 2) with noguarantee

Average interest rate shows the interest rate for each loan agreement as of the end of the fiscal period, rounded
to three decimal places. In regards to borrowings which interest rate swap transactions are entered into forthe purpose of avoiding risk from interest rate fluctuation, interest rates reflecting the interest rate swap areshown. In regards to borrowings repaid during the Reporting Period, the interest rate for each loan
agreement as of the repayment date rounded to three decimal places is shown.
(Note 2) The funds raised through borrowings are mainly used to acquire trust beneficiary interests in real estate andto repay the borrowings.
(Note 3) The balance at the end of the period will be repaid in full on the repayment date.
(Note 4) Long-term loans includes current portion of long-term loans payable- 55 -

3

Investment Corporation Bonds
Status of investment corporation bonds as of the end of the Reporting Period is as follows.
Bond Series

Issue DateFirst Series
Unsecured
Investment
Corporation Bonds(Note 1)
Second Series
Unsecured
Investment
Corporation Bonds(Note 1)
Third Series
Unsecured
Investment
Corporation Bonds(Note 1)Forth Series
Unsecured
Investment
Corporation Bonds(Note 1)Fifth Series
Unsecured
Investment
Corporation Bonds(Note 1)
Sixth Series
Unsecured
Investment
Corporation Bonds(Note 1)

(Note 3)(Note 4)(Note 5)41,000,000

1,000,000

0.400 May 25, 2023

(Note 2)

(Note 3)

May 25, 2018

1,000,000

1,000,000

0.800 May 25, 2028

(Note 2)

(Note 3)2,000,000

2,000,000

0.550(Note 2)

(Note 4)

October 12,
2018

October 12,
2023

Security/
Guaranty

Unsecured /Unguaranteed
October 28,
2019

October 28,
2019

March 13, 2020

1,000,000

1,000,000

0.480

2,000,000

2,000,000

0.900

1,200,000

1,200,000

0.850

8,200,000

8,200,000－

October 28,
2024

October 26,
2029

March 13,2030－

(Note 2)

(Note 5)(Note 2)

(Note 5)(Note 2)

(Note 4)－－－This is with pari passu conditions among specified corporate bonds.
The Investment Corporation Bonds may be purchased and cancelled at any time after the payment date, except
for the case where the laws and regulations or the depository otherwise stipulates.
The funds will be used to acquire trust beneficiary interest in real estate.
The funds will be used to repay borrowings.
The funds will be used in strategic capital expenditure.

Short-Term Investment Corporation Bonds
Not applicable

5

Redemption Use of
methodfunds

May 25, 2018

Total

(Note 1)
(Note 2)

Balance at theBalance at the Interest Rate
beginning of the
Redemption
end of the period(%)
periodDate(JPY thousand)(JPY thousand)

Investment Unit Options
Not applicable- 56 -

Acquisitions and Sales for the Reporting Period
1Acquisitions and Sales of Real Estate, Asset-Backed Securities, Infrastructure Assets andInfrastructure Related-Assets
Acquisition
Type of
asset

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

Name of property

Acquisition
Acquisition
price
date
(JPY million)

Sales date

Sales price(JPY million)(Note 1)
(Note 2)

Gain/loss on
Book value
sales(JPY million) (JPY million)(Note 3)(Note 1)
(Note 4)

A79 Revest Honjin－－

January 12,
2022

569

A80 Revest Matsubara－－

January 12,
2022

559

A82 Alba Noritake Shinmachi－－

January 12,
2022

509
4,450

1,468

A83 Revest Meieki Minami－－

January 12,2022

A88 Luna Court Edobori－－

January 12,
2022

457

A98 Little River Honmachibashi－－

January 12,
2022

272

－

－

Total

(Note 1)

(Note 2)
(Note 3)(Note 4)(Note 5)

2

Sale

498

4,450

2,867

1,468

The sale prices of individual residential properties sold on January 12, 2022 are not disclosed as thetransferee’s consent has not been obtained for disclosure. Accordingly, the gain on sales of individual
properties are not disclosed, either.
Sales price does not include various costs (brokerage commissions, taxes and other public dues) required forsale of the property, and is the sales price indicated in the trust beneficiary interest purchase agreement.
As of the date of each transaction.
Gain on sale is calculated by deducting the book value and the transfer related cost from the sales price foreach of the properties.
Amounts are rounded down to the nearest million yen.

Acquisitions and Sales of Other Assets
Assets other than those described above were mostly bank deposits or bank deposits in trust.

- 57 -

3

Transaction Price Verification of Specified Assets

Acquisitionor sale
Sale
Sale
Sale
Sale
Sale
Sale

Name of property

Transacti
Category of
specified asset on date

Sales price(JPY million)(Note 1)

Real estate Trust January
beneficiary
12, 2022
interest
Real estate Trust January
beneficiary
A80 Revest Matsubara
12, 2022
interest
Real estate Trust January
Alba Noritake
beneficiary
A82
12, 2022
Shinmachiinterest
Real estate Trust January
beneficiary
A83 Revest Meieki Minami
12, 2022
interest
Real estate Trust January
beneficiary
A88 Luna Court Edobori
12, 2022
interestReal
estateTrust
Little River
January
beneficiary
A98
12, 2022
Honmachibashi
interest
A79 Revest Honjin

Appraisal
value(JPY million)

Appraiser

Appraisal
date

875

Japan Real Estate November 1,
Institute
2021

867

Japan Real Estate November 1,
Institute
2021

792

Japan Real Estate November 1,
Institute
2021

832

Japan Real Estate November 1,
Institute
2021

632

Japan Real Estate November 1,
Institute
2021

432

Japan Real Estate November 1,
Institute
2021

4,450

(Note 1)The sale prices of individual residential properties sold on January 12, 2022 are not disclosed as thetransferee’s consent has not been obtained for disclosure.
(Note 2) Sales price does not include various costs (brokerage commissions, taxes and other public dues) required forsale of the property, and is the sales price indicated in the trust beneficiary interest purchase agreement.
(Note 3) The real estate appraisal described above is conducted by applying “Section 3: appraisals concerning pricesof real estate subject to securitization” of “Real Estate Appraisal Standard.”

4

Transactions with Interested Parties(1) Transactions
Not applicable(2) Commissions Paid
Not applicable
5

Transactions between CIM and Its Other Businesses

As CIM does not engage in any other business, such as the type I financial instruments business and the typeII financial instruments business, the building lots and buildings transaction business, or the real estate
specified joint enterprise, there are no applicable transactions.

- 58 -

Financial Condition
1

Assets, Liabilities, Principal, and Profit and Loss

Please refer to “II. Balance Sheet,” “III. Statement of Income and Retained Earnings,” “IV. Statement of
Changes in Net Assets,” “V. Notes to Financial Statements” and “VI. Statement of Cash Distribution.
2

Changes in the Calculation Method of Depreciation

Not applicable
3

Changes in the Evaluation Method of Real Estate and Infrastructure Assets, etc.

Not applicable4

Beneficiary Certificates of Investment Trusts, etc. Set Up by the Company

Not applicable- 59 -

Other1
NoticeBoard of Directors of Investment Corporation
Of the execution and amendment of the agreement approved by INV’s Board of Directors in the Reporting
Period, principal summary is as follows.
Approval date

Item

Summary

March 11, 2022

Conclusion of MOU toamend the MLPM
Agreements with MHM
Group

On March 11, 2022, INV entered into a MOU to amend respective
MLPM Agreements for domestic hotels owned by INV and operated by
INV's main tenant, MHM Group. Pursuant to the MOU, we havepartially changed the rent payment conditions and changed the fixed
rent payment amount, the variable rent calculation method, rent
payment method and payment date.

2
Disclosure of Companies Owning Real Estate Overseas
Not applicable
3
Disclosure of Real Estate Owned by Companies Owning Real Estate Overseas
Not applicable
4

Other

Unless there are specific statements to the contrary, monetary figures are rounded down to the nearest unit
and percentages are rounded off for unspecified values.

- 60 -

II.

Balance Sheet(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2021
(as of December 31, 2021)

AssetsCurrent assets:
Cash and bank deposits
Cash and bank deposits in trust
Rental receivables
Deposits paid
Prepaid expenses
Income taxes receivable
Other
Total current assets
Non-current assets:
Property and equipment
Buildings
Accumulated depreciation
Buildings, net
Buildings and accompanying facilities
Accumulated depreciation
Buildings and accompanying facilities, net
Structures, at cost
Accumulated depreciation
Structures, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Construction in progress
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Buildings and accompanying facilities in trust
Accumulated depreciation
Buildings and accompanying facilities in trust, net
Structures in trust, at cost
Accumulated depreciation
Structures in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property and equipment, net
Intangible assets
Leasehold rights
Leasehold rights in trust
Total intangible assets
Investment and other assets
Investment securities
Guarantee deposits
Long-term prepaid expenses
Derivatives assets
OthersTotal investments and other assets
Total non-current assets
Deferred assets
Investment corporation bond issuance costs
Total deferred assets
Total assets- 61 -

Fiscal period ended
June 30, 2022
(as of June 30, 2022)

12,759,582
6,766,557
2,293,736
153,517642,21910259
22,615,883

13,794,814
6,028,407
3,396,197
332,876
411,977
11
23,964,286

19,428,985(1,150,408)
18,278,576
5,294,556(800,261)
4,494,295
1,458
(118)
1,340
1,191,356(292,045)
899,310690,038
160,525,440(22,562,657)
137,962,783
32,459,003(11,144,094)
21,314,908
206,135(100,953)
105,182
2,876,215(1,461,143)
1,415,071
242,197,743
427,359,252

19,429,981(1,369,148)
18,060,833
5,303,078(953,381)
4,349,696
1,458
(150)
1,308
1,195,031(350,708)
844,322701,230
158,812,478(24,417,810)
134,394,668
32,062,171(11,735,097)
20,327,073
204,879(104,096)
100,783
2,942,196(1,631,561)
1,310,634
241,290,860
26,237421,407,648

10,637,811
14,497,257
25,135,069

10,637,811
14,458,659
25,096,471

17,856,387
1,372,719
379,42228,054
22,667
19,659,251
472,153,573

17,856,387
1,372,719
257,854
96,567
22,667
19,606,196
466,110,317

50,34950,349494,819,805

44,14844,148490,118,752

(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2021
(as of December 31, 2021)

Fiscal period ended
June 30, 2022
(as of June 30, 2022)

Liabilities
Current liabilities:
Accounts payable
Short-term loans payable
Current portion of investment corporation bonds
Current portion of long-term loans payable
Accounts payable-otherAccrued expenses
Income taxes payable

774,133

349,844

71,786,000

88,135,000-

1,000,000

48,667,000

44,807,000

6,235

31,175

291,883

240,333

605

605

Consumption taxes payable

540,868

50,190

Advances received

558,777

317,935

Deposits received

8,813

10,397

122,634,316

134,942,482

Total current liabilities
Non-current liabilities:
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits in trust

8,200,000

7,200,000

116,292,000

100,230,000

1,519,983

1,500,948

Derivatives liabilities

9,729

546

Asset retirement obligations

33,422

33,644

Total non-current liabilities

126,055,134

108,965,140

248,689,451

243,907,622

235,701,512

235,701,512

6,264,432

6,264,432(6,130)(6,130)

Other deduction of capital surplus(5,524,006)(5,524,006)

Total deduction of unitholders’ capital surplus(5,530,137)(5,530,137)

Total liabilities
Net assets
Unitholders’ equity:
Unitholders’ capital
Surplus:Capital surplus
Deduction of unitholders’ capital surplus
Allowance for temporary differences adjustment*2

Capital surplus, net
Retained earnings
Total surplus
Total unitholders’ equity

734,294734,294

9,676,221

9,679,301

10,410,516

10,413,596

246,112,028

246,115,108

18,32596,020

Valuation and translation adjustments:
Deferred gains or losses on hedges
Total valuation and translation adjustments
Total net assets*1

Total liabilities and net assets- 62 -

18,32596,020246,130,354

246,211,129

494,819,805

490,118,752

III.

Statement of Income and Retained Earnings(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2021
(from July 1, 2021 to
December 31, 2021)

Operating revenue
Rental revenue – real estateManagement contract revenue
Gain on sales of properties
Total operating revenue
Operating expenses
Property-related expenses
Management contract expenses
Asset management fees
Directors’ compensation
Asset custody fees
Administrative service fees
Other
Total operating expenses
Operating income
Non-operating income
Interest income
Foreign exchange gains
Interest on tax refund
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Interest expenses on investment corporation bonds
Amortization of investment corporation bond issuance costs
Loan-related costs
Loss of derivatives
Other
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings

Fiscal period ended
June 30, 2022
(from January 1, 2022 toJune 30, 2022)

*1
*2
*3

5,837,847
2,568,486
8,406,334

5,198,229
1,013,790
1,468,206
7,680,227*1*2

4,777,042
709,774
300,000
4,800
24,73254,720242,924
6,113,994
2,292,339

4,498,723
543,095
300,000
4,800
24,556
42,618152,051
5,565,846
2,114,380

70
1,118
5,887
7,076

78
1,316
2,606
4,000

602,398
40,71828,2306,303
596,446
10,5201,284,617
1,014,799
1,014,799
605
605
1,014,194
8,662,027
9,676,221

562,607
27,7696,200
505,414629
1,102,621
1,015,760
1,015,760
605
605
1,015,155
8,664,146
9,679,301- 63 -

IV.

Statement of Changes in Net Assets(Reference) Fiscal period ended December 31, 2021 (from July 1, 2021 to December 31, 2021)(Unit: JPY thousand)Unitholders’ equity
SurplusCapital surplus
Unitholders’capitalDeduction of capital surplus
Allowance fortemporarydifferences
adjustment

Capital surplus

Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus

Other
deduction ofcapital surplus

Total
deduction ofcapital surplus

Capital surplus(net)

235,701,512

6,264,432(6,130)(5,524,006)(5,530,137)

734,294

－

－

－

－

－

－

235,701,512

6,264,432(6,130)(5,524,006)(5,530,137)

734,294

Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodUnitholders’ equity
SurplusRetainedearnings(deficit)
Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus
Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodTotal
surplus

Valuation and translation adjustments
Totalunitholders’equityDeferred
gains or losses
on hedges(75,395)

Total
valuation andtranslation
adjustments(75,395)

Total
net assets

8,753,480

9,487,774

245,189,287

245,113,891(91,452)(91,452)(91,452)(91,452)

1,014,194

1,014,194

1,014,194

1,014,194
93,72093,72093,720922,741

922,741

922,741

93,72093,7201,016,462

9,676,221

10,410,516

246,112,028

18,32518,325

246,130,354- 64 -

Fiscal period ended June 30, 2022 (from January 1, 2022 to June 30, 2022)(Unit: JPY thousand)Unitholders’ equity
SurplusCapital surplus
Unitholders’capitalDeduction of capital surplus
Allowance fortemporarydifferences
adjustment

Capital surplus

Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus

Other
deduction ofcapital surplus

Total
deduction ofcapital surplus

Capital surplus(net)

235,701,512

6,264,432(6,130)(5,524,006)(5,530,137)

734,294

－

－

－

－

－

－

235,701,512

6,264,432(6,130)(5,524,006)(5,530,137)

734,294

Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodUnitholders’ equity
SurplusRetainedearnings(deficit)
Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus
Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodTotal
surplus

Valuation and translation adjustments
Totalunitholders’equityDeferred
gains or losses
on hedges
18,325

Total
valuation andtranslation
adjustments
18,325Total
net assets

9,676,221

10,410,516

246,112,028

246,130,354(1,012,075)(1,012,075)(1,012,075)(1,012,075)

1,015,155

1,015,155

1,015,155

1,015,155
77,69577,69577,695

3,080

3,080

3,080

77,69577,69580,775

9,679,301

10,413,596

246,115,108

96,02096,020246,211,129- 65 -

V.

Notes to Financial Statements[Notes Concerning Significant Accounting Policies]
By Period
Item
1. Evaluation standards andevaluation method ofassets(Reference)
Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)(a) Investment in affiliates
Cost method through moving-average method is used.
(b) Claims generated and debt incurred through derivative transactions
Market value method is used.(a)Investment in affiliates
Cost method through moving-averagemethod is used.
(b) Claims generated and debt incurred
through derivative transactions
Market value method is used.
2. Method of depreciation of non-current (a) Property and equipment(a) Property and equipment
assets
The straight-line method is used.
The straight-line method is used.
The useful lives of major property,
The useful lives of major property,
plant and equipment are as follows.
plant and equipment are as follows.
Buildings
16-50 years
Buildings
16-50 years
Buildings and accompanying
Buildings and accompanying
facilities
facilities
5-29 years
5-29 years
Structures
20 years
Structures
20 years
Tools, furniture and fixtures
3-18
Tools, furniture and fixtures
3-18
years
years
Buildings in trust
7-67 years
Buildings in trust
5-67 years
Buildings and accompanying
Buildings and accompanying
facilities in trust
3-33 years
facilities in trust
3-33 years
Structures in trust
10-55 years
Structures in trust
7-55 years
Tools, furniture and fixtures in trust
Tools, furniture and fixtures in trust
2-20 years
2-20 years(b) Intangible assets(b) Intangible assets
For fixed-term land lease for business
For fixed-term land lease forpurposes in Japan, the straight-line
business purposes in Japan, themethod based on the lease period is
straight-line method based on theused.
lease period is used.
(c) Long-term prepaid expenses(c) Long-term prepaid expenses
The straight-line method is used.
The straight-line method is used.
3. Accounting treatment of deferred
Investment corporation bond issuance
Investment corporation bond issuanceassetscosts
costs
Investment corporation bond issuance
Investment corporation bond issuancecosts are amortized using the straightcosts are amortized using the straightline method over a period up toline method over a period up to
redemption of the investment
redemption of the investment
corporation bonds.
corporation bonds.
4. Method of calculating allowances
Allowance for doubtful accounts
Allowance for doubtful accounts
To reserve for losses on doubtful To reserve for losses on doubtful
accounts, allowances are provided for accounts, allowances are provided fornormal receivables using a rate normal receivables using a rate
determined based on past bad debt determined based on past bad debt
experiences, and specific allowances are experiences, and specific allowances areprovided for accounts with a possibility provided for accounts with a possibilityof default based on the estimated of default based on the estimated- 66 -

5. Conversion of assets and liabilities inforeign currency into Japanese yen

6. Revenue and expense recognition

7. Method of hedge accounting

amounts considered to be uncollectible amounts considered to be uncollectible
by considering the collectability of by considering the collectability ofaccounts on an individual basis.
accounts on an individual basis.
Receivables and payables denominated Receivables and payables denominatedin foreign currencies are translated into in foreign currencies are translated into
yen at the spot exchange rate at the end yen at the spot exchange rate at the endof the fiscal period date, and differences of the fiscal period date, and differences
arising from the translation are treated as arising from the translation are treated asa profit or loss.
a profit or loss.
(a) Accounting treatment of property (a) Accounting treatment of property
taxes and other taxes
taxes and other taxes
With respect to property taxes, city
With respect to property taxes, city
planning taxes and depreciable asset
planning taxes and depreciable asset
taxes, of the tax amount assessed andtaxes, of the tax amount assessed anddetermined, the amount corresponding todetermined,theamountthe relevant fiscal period is accounted forcorresponding to the relevant fiscal
as property related expenses.
period is accounted for as property
Of the amounts paid to the seller for
related expenses.
acquisitions of real estate, the amountOf the amounts paid to the seller forequivalent to property taxes isacquisitions of real estate, the amountcapitalized as part of the acquisition costequivalent to property taxes isof the real estate instead of being charged
capitalized as part of the acquisition
as expense. The amount equivalent tocost of the real estate instead of being
property taxes that was capitalized as
charged as expense. The amountpart of the acquisition cost of real estate
equivalent to property taxes that was
during the fiscal period ended December
capitalized as part of the acquisition
31, 2021 is zero.
cost of real estate during theReporting Period is zero.
(b) Recognition of revenue(b) Recognition of revenue
The following is the content of
The following is the content ofprincipal performance obligations
principal performance obligations
related to revenue from contracts withrelated to revenue from contracts with
INV’s customers and the normal
INV’s customers and the normal
timing for the satisfaction of suchtiming for the satisfaction of suchobligations (normal timing forobligations (normal timing forrevenue recognition).
revenue recognition).
Sale of real estate, etc.
Sale of real estate, etc.
For the sale of real estate, etc.,
For the sale of real estate, etc.,
revenue will be recognized at the timerevenue will be recognized at the time
the control of such real estate, etc. is
the control of such real estate, etc. is
obtained by the purchaser, who is theobtained by the purchaser, who is thecustomer, as the transfer obligation
customer, as the transfer obligation
will be fulfilled pursuant to thewill be fulfilled pursuant to thecontract pertaining to the sale of realcontract pertaining to the sale of realestate.
estate.
(a) Method of hedge accounting(a) Method of hedge accounting
Deferred hedge accounting is used.
Deferred hedge accounting is used.
(b) Hedging instrument and hedged item (b) Hedging instrument and hedged item
Hedging instrument: interest rate
Hedging instrument: interest rate
swap
swap
Hedged item: interest on
Hedged item: interest on
borrowings
borrowings(c) Hedge policy(c) Hedge policy
INV enters into derivatives
INV enters into derivatives
transactions for the purpose oftransactions for the purpose ofhedging against the risks set forth inhedging against the risks set forth in
INV’s Articles of Incorporation in
INV’s Articles of Incorporation inaccordance with its risk management
accordance with its risk management
policy.
policy.
(d) Method of evaluating hedge(d) Method of evaluating hedge
effectivenesseffectivenessHedge effectiveness is evaluated byHedge effectiveness is evaluated bycomparing the cumulative amount ofcomparing the cumulative amount of- 67 -

changes in cash flows of the hedging
instrument and the cumulative
amount of changes in cash flows of
the hedged item and verifying thedifference in the amounts of changeof both the hedged item and thehedging instrument.
8. Other significant matters which(1) Accounting treatment policy of trust
constitute the basis for preparation of
beneficiary interests in real estate
financial statements
As to trust beneficiary interests inreal estate, all accounts of assets andliabilities within assets in trust, as
well as all income generated andexpenses incurred from assets intrust, are recorded in the relevantbalance sheets and income statement
accounts.
Of such items, thefollowing significant trust assets andliabilities are shown separately on
the balance sheet.
(a) Cash and bank deposits in trust(b) Buildings in trust
Buildings and accompanying
facilities in trust
Structures in trust
Tools, furniture and fixtures intrustInd in trust(c) Leasehold rights in trust(d) Tenant leasehold and security
deposits in trust(2)
Accounting
treatmentofconsumption taxes
Transactions subject to consumption
taxes are recorded at amounts
exclusive of consumption taxes.

changes in cash flows of the hedging
instrument and the cumulative
amount of changes in cash flows of
the hedged item and verifying thedifference in the amounts of changeof both the hedged item and thehedging instrument.
(1) Accounting treatment policy of trust
beneficiary interests in real estate
As to trust beneficiary interests inreal estate, all accounts of assets andliabilities within assets in trust, as
well as all income generated andexpenses incurred from assets intrust, are recorded in the relevantbalance sheets and income statement
accounts.
Of such items, thefollowing significant trust assets andliabilities are shown separately on
the balance sheet.
(a) Cash and bank deposits in trust(b) Buildings in trust
Buildings and accompanying
facilities in trust
Structures in trust
Tools, furniture and fixtures intrust
Land in trust
Construction in progress in trust(c) Leasehold rights in trust(d) Tenant leasehold and security
deposits in trust(2) Accounting treatment of nondeductible consumption taxes
Non-deductible consumption taxesetc. regarding the acquisition ofassets are capitalized at amounts ofacquisition cost of each asset.

[Notes on Material Accounting Estimates](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)- 68 -

1. Valuation of non-current assets(1) Amount recorded in the financial statements for the fiscal
period ended December 31, 2021
(JPY thousand)Impairment loss

1. Valuation of non-current assets(1) Amount recorded in the financial statements for theReporting Period(JPY thousand)Impairment loss

Non-current assets
451,804,282(Rental properties)
Although no impairment loss was recorded in the fiscal
period ended December 31, 2021, we recognize it as adisclosure item in view of the risk of having a significant
impact on the financial statements for the next fiscal period.

Non-current assets
445,776,652(Rental properties)
Although no impairment loss was recorded in the Reporting
Period, we recognize it as a disclosure item in view of therisk of having a significant impact on the financial
statements for the next fiscal period.

(2) Information about the content of material accounting
estimates for the identified item
We determine whether or not there are any signs of possible
impairment pertaining to rental properties owned by INV.
If there are any signs, we determine whether or not INV
should recognize the impairment loss. No impairment
loss was recognized for INV’s rental properties, since future
cash flows before discounting exceed the book value ofrental properties.
In estimating future cash flows, it is assumed that theadverse effect by the spread of COVID-19 infections willcontinue in 2022, but the pandemic will be graduallycontained and the business environment will recover in
2023 onwards. However, it is difficult to accurately
predict when the spread of COVID-19 infections will becontained and how much the impact will be. Changes in
the infection status may affect the above estimates and INV
may incur impairment losses.

(2) Information about the content of material accounting
estimates for the identified item
We determine whether or not there are any signs of possible
impairment pertaining to rental properties owned by INV.
If there are any signs, we determine whether or not INV
should recognize the impairment loss. No impairment
loss was recognized for INV’s rental properties, since future
cash flows before discounting exceed the book value ofrental properties.
In estimating future cash flows, it is assumed that theadverse effect by the spread of COVID-19 infections willcontinue in the second half of 2022, but the pandemic will
be gradually contained and the business environment will
recover in 2023 onwards. However, it is difficult toaccurately predict when the spread of COVID-19 infections
will be contained and how much the impact will be.
Changes in the infection status may affect the above
estimates and INV may incur impairment losses.

- 69 -

[Notes to Changes in Accounting Policies](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)
Application of Accounting Standard for Revenue Recognition,etc.
INV has applied the “Accounting Standard for Revenue
Recognition” (ASBJ Statement No. 29, March 31, 2020) andrelevant ASBJ regulations effective from the beginning of the
fiscal period ended December 31, 2021 and it has recognizedrevenue at the time the control of promised goods or services
is transferred to the customer at the amount expected to bereceived upon exchange of said goods or services. This change
has no impact on the financial statements of the fiscal period
ended December 31, 2021.
Application of Accounting Standard for Fair Value
Measurement, etc.
INV has applied the “Accounting Standard for Fair Value
Measurement” (ASBJ Statement No. 30, July 4, 2019) andrelevant ASBJ regulations from the beginning of the fiscal
period ended December 31, 2021, and it has applied the new
accounting policy provided for by the Accounting Standard for
Fair Value Measurement, etc. prospectively in accordance withthe transitional measures provided for in paragraph 19 of the
Accounting Standard for Fair Value Measurement, andparagraph 44-2 of the “Accounting Standard for Financial
Instruments” (ASBJ Statement No. 10, July 4, 2019). Thischange has no impact on the financial statements of the fiscal
period ended December 31, 2021.

- 70 -

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)
Not applicable[Notes to the Balance Sheet](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)*1. Minimum net assets as required by Article 67, Paragraph
4 of the Act on Investment Trusts and Investment
Corporations
JPY 50,000 thousand*2. Allowance for temporary differences adjustment

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)*1. Minimum net assets as required by Article 67, Paragraph
4 of the Act on Investment Trusts and Investment
Corporations
JPY 50,000 thousand(Reference) Fiscal period ended December 31, 2021 (from July 1, 2021 to December 31, 2021)
1. Reasons, related assets and amounts(Unit: JPY thousand)Relatedassets, etc.

ReasonLeaseholdrights intrust

Amortization ofleasehold rights

Initial amount

Total

Balance at the
beginning of
periodAllowance
set aside
duringperiodReversalduringperiodBalance at theend of period(131,332)(6,130)--(6,130)(131,332)(6,130)--(6,130)2. Method of reversal(1) Leasehold rights in trust
The corresponding amount is scheduled to be reversed upon sale of the relevant properties, etc.
Fiscal period ended June 30, 2022 (from January 1, 202 June 30, 2022)
1. Reasons, related assets and amounts(Unit: JPY thousand)Relatedassets, etc.

ReasonLeaseholdrights intrust

Amortization ofleasehold rights

Total

Initial amount

Balance at the
beginning of
periodAllowance
set aside
duringperiodReversalduringperiodBalance at theend of period(131,332)(6,130)--(6,130)(131,332)(6,130)--(6,130)2. Method of reversal(1) Leasehold rights in trust
The corresponding amount is scheduled to be reversed upon sale of the relevant properties, etc.

- 71 -

[Notes to Statement of Income and Retained Earnings](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)*1. Real estate rental revenues and expenses(Unit: JPY thousand)
A. Real estate rental revenues*1. Real estate rental revenues and expenses(Unit: JPY thousand)
A. Real estate rental revenues

Rental revenue – real estate(Rent/common area charges) (Note)(Other revenues)
Total

Rental revenue – real estate
5,636,467(Rent/common area charges) (Note)

201,380(Other revenues)

5,837,847

Total

B. Real estate rental expenses

B. Real estate rental expenses

Property-related expenses

Property-related expenses

151,944
5,198,229(Maintenance costs)

465,075(Maintenance costs)

439,577(Taxes and public dues)

753,548(Taxes and public dues)

588,582(Insurance expenses)

20,256(Insurance expenses)

19,867(Depreciation expenses)

3,420,925(Depreciation expenses)

3,335,739(Other expenses)
Total

117,236(A-B)(Note) Of which, revenue from variable
hotel rents

Total

114,957
4,498,723

C. Real estate rental income
1,060,805
1,280,015*2. Management contract revenue and expenses(Unit: JPY thousand)Hotel operating revenue
Hotel operating expenses
Management contract revenue (A-B)
Management contract expenses
Management contract losses (A-B)(Note)
Non-life insurance expenses
Depreciation expenses
Total(Other expenses)

4,777,042

C. Real estate rental income

A.
B.
C.
D.

5,046,284

819,087995,357-(A-B)(Note) Of which, revenue from variable
hotel rents

E.

Management contract revenue and(709,774)
expenses (C-D)(Note) If hotel operating expenses exceed hotel operating
revenue, the excess amount is recorded as
management contract losses.

- 72 -

2,038,648*2. Management contract revenue and expenses(Unit: JPY thousand)
A.
B.
C.
D.

176,269
103,910429,594
709,774

699,505

E.

Hotel operating revenue
Hotel operating expenses
Management contract revenue (A-B)
Management contract expenses
Non-life insurance expenses
Depreciation expenses
Total
Management contract revenue andexpenses (C-D)

3,180,828
2,167,037
1,013,790
112,825430,270543,095
470,695

*3. Gain on sales of properties*3. Gain on sales of properties(Unit: JPY thousand)Lexington Plaza Hachiman
Proceeds from sales of property

3,660,000

Cost of sales of property

2,982,382(Unit: JPY thousand)
Revest Honjin, Revest Matsubara, Alba Noritake
Shinmachi, Revest Meieki Minami, Luna Court Edobori
and Little River Honmachibashi (Note)
Proceeds from sales of properties

4,450,000
2,867,202

Other expenses on sales of property

86,632

Cost of sales of properties

Gain on sales of property

590,985

Other expenses on sales of properties

114,591

Gain on sales of properties
1,468,206
Invoice Shin-Kobe Residence, Cosmo Court Motomachi,
Vendir Hamaotsu Ekimae, Salvo Sala, Winntage Kobe
(Note) The sale prices of individual properties are not disclosed
Motomachi, Corp Higashinotoin, and HERMITAGE NANBA
as the transferees’ consent has not been obtained for
WEST (Note)
disclosure.
Proceeds from sales of properties

6,150,000

Cost of sales of properties

4,014,374

Other expenses on sales of properties
Gain on sales of properties

158,123
1,977,501(Note) The sale prices of individual properties are not disclosed
as the transferees’ consent has not been obtained fordisclosure.

[Notes to Statement of Changes in Net Assets](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

Total number of issuable investment units and number ofinvestment units issued and outstanding

Total number of issuable investment units and number ofinvestment units issued and outstanding

Total number of investment units authorized 10,000,000 units

Total number of investment units authorized 10,000,000 units

Total number of investment units issued andoutstanding

Total number of investment units issued andoutstanding

6,096,840 units- 73 -

6,096,840 units

[Notes Related to Tax Accounting](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

1. Significant components of deferred tax assets and liabilities(Unit: JPY thousand)(Deferred tax assets)
Enterprise tax payable615

1. Significant components of deferred tax assets and liabilities(Unit: JPY thousand)(Deferred tax assets)
Enterprise tax payable
615

Buildings and other (merger)

186,136

Buildings and other (merger)

187,068

Land (merger)

116,724

Land (merger)

116,724

Loss carried forward (Note 1)

1,810,135

Loss carried forward (Note 1)

1,799,777

Asset retirement obligations

10,514

Asset retirement obligations

10,584

Amortization of leasehold right
Adjustment of acquisition prices(overseas properties)
Subtotal
Valuation allowance for tax loss
carried forward
Valuation allowance for the total of
deductible temporary differences,
etc.
Subtotal (Note 2)

137,567

Amortization of leasehold right
Adjustment of acquisition prices(overseas properties)
Subtotal
Valuation allowance for tax loss
carried forward
Valuation allowance for the total of
deductible temporary differences,
etc.
Subtotal

149,710457,4822,719,176(1,810,135)(909,041)(2,719,176)

453,535
2,718,017(1,799,777)(918,239)(2,718,017)

Total- Total(Note 1) The amounts of tax loss carried forward and the (Note 1) The amounts of tax loss carried forward and thedeferred tax assets by carry-forward period are asdeferred tax assets by carry-forward period are as
follows.
follows.
(Unit: JPY thousand)(Unit: JPY thousand)Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsTax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsDue
withinone year

Due after
one to twoyears

Due after
two tothree years

201,072

320,467

-

-

-

-

-

-

(201,072)(320,467)--

Due after
four tofive years

Due after
five years

Total

-

1,288,595

1,810,135-(1,288,595)(1,810,135)

-

-

-

Due after
three tofour years
Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsTax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsDue
withinone year

Due after
one to twoyears

Due after
two tothree years

Due after
three tofour years

511,182---(511,182)

-

-

-

-

-

-

-

Due after
four tofive years

Due after
five years

Total

-

1,288,595

1,799,777-(1,288,595)(1,799,777)

-

-

-

(a) Tax loss carried forward is multiplied by statutory tax rate.
(Note 2) Valuation allowance decreased by JPY 320,159
thousand mainly due to sales of land and buildings.
2. Significant difference between statutory tax rate and theeffective tax rate
Statutory tax rate
31.46%(a) Tax loss carried forward is multiplied by statutory tax rate.

Changes in valuation allowance(31.46)%

Deductible cash distributions(31.35)%

Others0.06%

Changes in valuation allowance(0.11)%

Effective tax rate

0.06%

Others0.06%

Effective tax rate

0.06%

- 74 -

2. Significant difference between statutory tax rate and theeffective tax rate
Statutory tax rate
31.46%

[Notes Related to Financial Instruments](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

1. Status of financial instruments

1. Status of financial instruments(1) Policy for financial instruments(1) Policy for financial instruments

INV principally conducts its operations throughinvestments in real estate and other specified assets to seek
to ensure stable income in the medium to long term.
The policy for raising funds is principally through issuing
new investment units, investment corporation bonds, orborrowing loans.
Derivative transactions are to be entered into for the
purpose of hedging against the risks of future interest rate
fluctuations, exchange rate fluctuations, etc. and not for
speculation.
Surplus funds are managed after carefully taking into
account safety, liquidity, the interest rate environment andfinancing.
(2) Nature and extent of risks arising from financial
instruments and risk management.

INV principally conducts its operations throughinvestments in real estate and other specified assets to seek
to ensure stable income in the medium to long term.
The policy for raising funds is principally through issuing
new investment units, investment corporation bonds, orborrowing loans.
Derivative transactions are to be entered into for the
purpose of hedging against the risks of future interest rate
fluctuations, exchange rate fluctuations, etc. and not for
speculation.
Surplus funds are managed after carefully taking into
account safety, liquidity, the interest rate environment andfinancing.
(2) Nature and extent of risks arising from financial
instruments and risk management.

The funds raised through borrowings and issuinginvestment corporation bonds are mainly used to acquire
real estate properties or trust beneficiary interest in realestate (including related acquisition costs) and for therefinancing of existing loans. Liquidity risks relating toloan are managed by the finance department of CIM by
preparing and updating plans for funds, and monitoring
the covenants set forth in loan agreements.
(3) Supplemental information regarding fair value, etc. forfinancial instruments.
Since certain assumptions, etc. are used in estimating thefair value of financial instruments, different assumptions,etc. may result in the variance of such value.

- 75 -

The funds raised through borrowings and issuinginvestment corporation bonds are mainly used to acquire
real estate properties or trust beneficiary interest in realestate (including related acquisition costs) and for therefinancing of existing loans. Liquidity risks relating toloan are managed by the finance department of CIM by
preparing and updating plans for funds, and monitoring
the covenants set forth in loan agreements.
(3) Supplemental information regarding fair value, etc. forfinancial instruments.
Since certain assumptions, etc. are used in estimating thefair value of financial instruments, different assumptions,etc. may result in the variance of such value.

2. Estimated fair value of financial instruments.
Book value, fair value and the difference between value asof December 31, 2021 are as follows. “Cash and bankdeposits”, “Cash and bank deposits in trust” and “Short-termloans payable” are omitted because their fair values areclose to their book values since they are settled in cash andin a short period of time. Moreover, “Tenant leasehold andsecurity deposits in trust” is omitted because they are notmaterial.
(Unit: JPY thousand)2. Estimated fair value of financial instruments.
Book value, fair value and the difference between value asof June 30, 2022 are as follows. “Cash and bank deposits”,“Cash and bank deposits in trust” and “Short-term loans
payable” are omitted because their fair values are close to
their book values since they are settled in cash and in a shortperiod of time. Moreover, “Tenant leasehold and security
deposits in trust” is omitted because they are not material.

Book ValueBook Value(1) Investment
securities
Total assets(2) Current portion of
long-term loans payable(3) Investment
corporation bonds

Fair Value

17,856,387

17,320,018 (536,369)

17,856,387

17,320,018 (536,369)(48,667,000)(48,667,000)-(8,200,000)(7,657,040)

542,960(4) Long-term loans(116,292,000)(116,292,000)-

Total liabilities(173,159,000)(172,616,040)

542,960

18,32518,325-(5) Derivatives(Unit: JPY thousand)Difference(1) Investment
securities(*2) Receivables and payables arising from derivativetransactions are recorded in net amounts, and if the total
net amount is a negative amount, such amount is shownin parenthesis.

(Note 1) Methods to calculate fair value of financial
instruments.
(1) Investment securities
For preferred equity interest, the assets and liabilities of theinvestee are valued at fair value, and the equity equivalent in
the obtained net asset value is deemed as the fair value of thepreferred equity interest.

Difference

17,856,387

17,521,928 (334,458)

17,856,387

17,521,928 (334,458)(1,000,000)(985,500)

14,500(44,807,000)(44,807,000)-(7,200,000)(6,689,440)

510,560(5) Long-term loans(100,230,000)(100,230,000)-

Total liabilities(153,237,000)(152,711,940)

525,060

96,02096,020-Total assets(2) Current portion of
Investment
Corporation Bonds(3) Current portion of
long-term loans
payable(4) Investment
corporation bonds(*1) Items recorded in the Liabilities Section are shown inparenthesis.

Fair Value(6) Derivatives(*1) Items recorded in the Liabilities Section are shown inparenthesis.
(*2) Receivables and payables arising from derivativetransactions are recorded in net amounts, and if the total
net amount is a negative amount, such amount is shownin parenthesis.
(Note 1) Methods to calculate fair value of financial
instruments.
(1) Investment securities
For preferred equity interest, the assets and liabilities of theinvestee are valued at fair value, and the equity equivalent in
the obtained net asset value is deemed as the fair value of thepreferred equity interest.

(2) Current portion of long-term loans payable (4) Longterm loans
Long-term loans with floating interest rates reflecting changes
in market rates within a short-term period are stated at theirbook value as their book value approximate their fair value.
(3) Investment corporation bonds
Fair value is calculated using a method based on market price.
(5) Derivatives(a) Derivatives transactions to which hedge accounting is
not applied
Not applicable- 76 -(2) Current portion of Investment Corporation Bonds (4)Investment corporation bonds
Fair value is calculated using a method based on market price.
(3) Current portion of long-term loans payable (5) Long-termloans payable
Long-term loans with floating interest rates reflecting changes
in market rates within a short-term period are stated at theirbook value as their book value approximate their fair value.
(6) Derivatives(a) Derivatives transactions to which hedge accounting is
not applied
Not applicable(b) Derivatives transactions to which hedge accounting isappliedThe contract amount as of the closing date under eachhedge-accounting method and the amount equivalent
to the notional principal prescribed in the contracts are
as shown below.

(b) Derivatives transactions to which hedge accounting isappliedThe contract amount as of the closing date under eachhedge-accounting method and the amount equivalent
to the notional principal prescribed in the contracts are
as shown below.

(Unit: JPY thousand)(Unit: JPY thousand)Contract amount, etc.
Method of Derivativehedge

transaction

accounting

type, etc.

(*1)

Primary

Amount due

hedged item

afterContract amount, etc.
Fair value(*2)

Method of Derivativehedge

transaction

accounting

type, etc.

(*1)

Primary

Amount due

hedged item

after

one yearaccounting
methodInterest rate

swap
Receivefloating(*2)

one yearInterest rate
Principle

Fair value

Principle
Borrowings

64,648,000

50,476,000

18,325accounting
methodrate/pay
fixed rate

swap
Receivefloating

Borrowings

50,476,000

36,687,000

96,020rate/pay
fixed rate(*1) The contract amount, etc. for interest rate swap arestated based on a notional principal.
(*2) Estimation method for fair value
Interest rate swap:
Estimated based on the price, etc. presented by thecorrespondent financial institutions.

(*1) The contract amount, etc. for interest rate swap arestated based on a notional principal.
(*2) Estimation method for fair value
Interest rate swap:
Estimated based on the price, etc. presented by thecorrespondent financial institutions.

(Note 2) Repayment schedule of investment corporation
bonds, long-term loans payable and other interestbearing debts after the closing date of the fiscal
period(Note 2) Repayment schedule of investment corporation
bonds, long-term loans payable and other interestbearing debts after the closing date of the fiscal
period(Unit: JPY thousand)Current portion of longterm loans payable
Investment corporationbonds
Long-term loans payable
Total

Due within
one year

Due after one Due after two
to two years to three years

48,667,000

-

-

-

3,000,000

1,000,000-

42,405,000

34,127,000

48,667,000

45,405,000

35,127,000(Unit: JPY thousand)Current portion of
Investment Corporation
Bonds
Current portion of longterm loans payable
Investment corporationbonds
Long-term loans payable

Due after three Due after four Due after five
to four years to five years
years
Current portion of longterm loans payable
Investment corporation
bonds

-

-

-

-

-

4,200,000

Long-term loans payable

38,799,000-

961,000

Total

38,799,000-

5,161,000- 77 -

Total

Due within
one year

Due after one Due after two
to two years to three years

1,000,000--

44,807,000

-

-

-

2,000,000

1,000,000-

44,589,000

42,243,000

45,807,000

46,589,000

43,243,000

Due after three Due after four Due after five
to four years to five years
years
Current portion of
Investment Corporation
Bonds
Current portion of longterm loans payable
Investment corporation
bonds

-

-

-

-

-

-

-

-

4,200,000

Long-term loans payable

12,437,000-

961,000

Total

12,437,000-

5,161,000

[Notes Related to Asset Retirement Obligations](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

1. Summary of the asset retirement obligations for the period
INV has recorded asset retirement obligations in regard to
its obligation to restore the land to its original condition
related to the fixed-term land lease agreement of Comfort
Hotel Maebashi held by INV.
2. Calculation method for asset retirement obligations for theperiodThe amount of the asset retirement obligations has been
calculated by fixing the estimated period of use at 43 years,
based on the period until the expiration of the fixed-term
land lease agreement, and by using a discount rate of
1.342%.
3. Increase/decrease in the total amount of asset retirement
obligations for the end of the period(Unit: JPY thousand)

1. Summary of the asset retirement obligations for the period
INV has recorded asset retirement obligations in regard to
its obligation to restore the land to its original condition
related to the fixed-term land lease agreement of Comfort
Hotel Maebashi held by INV.
2. Calculation method for asset retirement obligations for theperiodThe amount of the asset retirement obligations has been
calculated by fixing the estimated period of use at 43 years,
based on the period until the expiration of the fixed-term
land lease agreement, and by using a discount rate of
1.342%.
3. Increase/decrease in the total amount of asset retirement
obligations for the end of the period(Unit: JPY thousand)

Balance at the beginning of the period
Increase due to the acquisition of properties
Accretion expense
Balance at the end of the period

33,197224
33,422- 78 -

Balance at the beginning of the period
Increase due to the acquisition of properties
Accretion expense
Balance at the end of the period

33,422
222
33,644

[Notes Related to Rental Properties](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

INV owns residential properties and hotels as core assets
principally in the Greater Tokyo area and major regional
cities with an aim to establish a portfolio focusing on bothstability and growth potential. The book value changed
during the period and the fair value at the end of the period
are as follows.

INV owns residential properties and hotels as core assets
principally in the Greater Tokyo area and major regional
cities with an aim to establish a portfolio focusing on bothstability and growth potential. The book value changed
during the period and the fair value at the end of the period
are as follows.

(Unit: JPY thousand)(Unit: JPY thousand)Book value

Use

Fair value atBalance at theBalance at the the end of the
Change during
periodbeginning of
end of thethe period
the period
periodBook value

Use

Fair value atBalance at theBalance at the the end of the
Change during
periodbeginning of
end of thethe period
the period
periodResidences

41,998,033(4,304,561)

37,693,472

49,803,000

Residences

37,693,472(3,125,906)

34,567,566

46,074,000

Commercial
facilities

4,661,429(3,011,821)

1,649,608

2,380,000

Commercial
facilities

1,649,608(27,624)

1,621,984

2,380,000

Hotels415,505,072(3,043,871)

412,461,201

471,512,500

Hotels412,461,201(2,874,099) 409,587,102

481,758,260

Total

462,164,535(10,360,253)

451,804,282

523,695,500

Total

451,804,282(6,027,630) 445,776,652

530,212,260(Note 1) Book value is the figure calculated by subtracting
amount of accumulated depreciation fromacquisition price (including acquisition-related
costs).
(Note 2) The major factors for the increase for the fiscal
period ended December 31, 2021 were construction
work related to capital expenditures.
(Note 3) The major factor of the decrease was sale ofresidential properties and a retail facility andrecording of depreciation.
(Note 4) The fair value as of the end of the fiscal period ended
December 31, 2021 is determined based on theappraisal value or survey value provided by Asset
Research and Development Inc., Japan Real Estate
Institute, JLL Morii Valuation & Advisory K.K.,
The Tanizawa Sogo Appraisal Co., Ltd., Daiwa Real
Estate Appraisal Co., Ltd. and CBRE, Inc.
However, the sale price is deemed the fair value ofsix residential properties , for which the purchaseand sale agreement was entered into on December
8, 2021.

(Note 1) Book value is the figure calculated by subtracting
amount of accumulated depreciation fromacquisition price (including acquisition-related
costs).
(Note 2) The major factors for the increase for the Reporting
Period were construction work related to capital
expenditures.
(Note 3) The major factor of the decrease was sale ofresidential properties and recording of depreciation.
(Note 4) The fair value as of the end of the Reporting Period
is determined based on the appraisal value or survey
value provided by Asset Research and Development
Inc., Japan Real Estate Institute, JLL Morii
Valuation & Advisory K.K., The Tanizawa Sogo
Appraisal Co., Ltd., Daiwa Real Estate Appraisal
Co., Ltd. and CBRE, Inc.
For information related to profits and losses from rental
properties in the Reporting Period, please refer to “Notes toStatement of Income and Retained Earnings.”

For information related to profits and losses from rental
properties in the fiscal period ended December 31, 2021,
please refer to “Notes to Statement of Income and Retained
Earnings.”[Notes Related to Restriction on Asset Management](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

Not applicable.

Not applicable.

- 79 -

[Notes Related to Transactions with Related Parties](Reference) Fiscal period ended December 31, 2021 (from July 1, 2021 to December 31, 2021)
1

Interested parties of CIM
NameBusiness or occupation

Percentage ofvoting rights
owned
(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Account

Balance at the end of
the period(JPY thousand)(Note 1)Naqua Hotel &Resorts
Management Co.,
Ltd.
(Note 2)Hotelbusiness-

Rental revenues

721,419

Accounts
receivable

422,909

MyStays HotelManagement Co.,
Ltd.
(Note 2)Hotelbusiness-

Rental revenues

2,182,504

Accounts
receivable

1,436,837

Classification

Interested
party of CIM(Note 1)
(Note 2)2

Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
Naqua Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management Co., Ltd. have no capital relationship to be disclosedwith CIM. However, these tenants and operators have received an anonymous partnership investment or investment through funds thatare managed by affiliates of FIG (a subsidiary of SoftBank Group Corp., which is a parent company of CIM directly/indirectly owning
100% of its issued shares). Accordingly, INV treats Naqua Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management
Co., Ltd. as the equivalent to interested parties.

Asset Custody Company
Classification

Asset CustodyCompany

Name

Sumitomo Mitsui
Trust Bank,
LimitedBusiness or
occupation

Banking andtrust business

Percentage ofinvestment
units owned(%)

Type of transaction
Borrowing of
short-term loan
Repayment ofshort-term loan
Repayment oflong-term loan-

Transaction
amount(JPY thousand)(Note 1)
5,018,500
2,998,500
1,890,000

Account

Balance at theend of the period(JPY thousand)(Note 1)

Short-termloans payable

9,483,000

Long-termloans payable

25,248,000

Prepaid expenses

58,580Finance-related fees
(Note 2)

15,055Long-term
prepaid expenses

61,056

Interest expenses(Note 2)

84,076 Accrued expenses

920(Note 1) Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
(Note 2) The terms and conditions have been determined based on actual market conditions.

- 80 -

Fiscal period ended June 30, 2022 (from January 1, 2022 to June 30, 2022)
1

Interested parties of CIM

Classification

Name

Business or occupation

Percentage ofvoting rights
owned
(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Account

Balance at the end of
the period(JPY thousand)(Note 1)Naqua Hotel &Resorts
Hotel
RentalManagement
Rental revenues
422,206
464,466
business
receivables
Co., Ltd.
Interested(Note 2)
party of CIM
MyStays HotelManagement
Hotel
RentalRental revenues
2,190,756
2,407,825
Co., Ltd.
business
receivables(Note 2)
(Note 1) Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
(Note 2) Naqua Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management Co., Ltd. have no capital relationship to be disclosedwith CIM. However, these tenants and operators have received an anonymous partnership investment or investment through funds thatare managed by affiliates of FIG (a subsidiary of SoftBank Group Corp., which is a parent company of CIM directly/indirectly owning
100% of its issued shares). Accordingly, INV treats Naqua Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management
Co., Ltd. as the equivalent to interested parties.

2 Asset Custody Company
Classification

Asset CustodyCompany

Name

Sumitomo Mitsui
Trust Bank,
LimitedBusiness or
occupation

Banking andtrust business

Percentage ofinvestment
units owned(%)

Type of transaction
Borrowing of
short-term loan
Repayment ofshort-term loan
Repayment oflong-term loan-

Transaction
amount(JPY thousand)(Note 1)
9,964,500
4,464,500
5,500,000

Account

Balance at theend of the period(JPY thousand)(Note 1)

Short-termloans payable

14,983,000

Long-termloans payable

19,748,000

Prepaid expenses

61,173Finance-related fees
(Note 2)29,893Long-term
prepaid expenses

43,131

Interest expenses(Note 2)80,984 Accrued expenses

449(Note 1) Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
(Note 2) The terms and conditions have been determined based on actual market conditions.

- 81 -

[Notes Related to Per Unit Information](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

Net assets per unit

JPY 40,370

Net assets per unit

JPY 40,383

Net income per unit

JPY 166

Net income per unit

JPY 167

Net income per unit is calculated by dividing net income forthe period by the daily weighted average number of investment
units issued and outstanding. Diluted net income per unit is
not stated, as there are no diluted units.
(Note)Net income per unit is calculated by dividing net income forthe period by the daily weighted average number of investment
units issued and outstanding. Diluted net income per unit is
not stated, as there are no diluted units.

The basis for calculating net income per unit is as follows.

(Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)
Net income for the period (JPY thousand)Amounts not attributable to common unitholders(JPY thousand)Net income attributable to common units(JPY thousand)Average number of investment units during theperiod (units)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

1,014,194
1,014,194
6,096,840- 82 -Net income for the period (JPY thousand)Amounts not attributable to common unitholders(JPY thousand)Net income attributable to common units(JPY thousand)Average number of investment units during theperiod (units)

1,015,155
1,015,155
6,096,840

[Notes Related to Revenue Recognition](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

1. Breakdown of revenue from contracts with customers

1. Breakdown of revenue from contracts with customers(Unit: JPY thousand)Sale of realestate, etc.
Other
Total

Revenue fromcontracts withcustomers (Note 1)

Net sales to externalcustomers

3,660,000(Note 2) 590,985

27,8703,687,870(Unit: JPY thousand)
Revenue fromcontracts withcustomers (Note 1)
Sale of realestate, etc.
Other
Total

7,815,349
8,406,334

Net sales to externalcustomers--

21,281
21,2817,680,227
7,680,227(Note 1) Revenue from the leasing business subject to the“Accounting Standard for Lease Transactions” (ASBJ
Statement No. 13), dividend income subject to the“Accounting Standard for Financial Instruments”(ASBJ Statement No. 10) and the sale of real estate,etc. subject to the “Practical Guidelines on Accounting
by Transferors for Securitization of Real Estate Using
Special Purpose Companies” (Accounting System
Committee Report No. 15 of the Japanese Institute ofCertified Public Accountants) are not included in“Revenue from contracts with customers” as they are
not covered by the Accounting Standard for Revenue
Recognition. Major revenue from contracts withcustomers is proceeds from sale of real estate
properties.
(Note 2) The sale of real estate, etc. is the amount of proceedsfrom sale of real estate properties, less cost of realestate properties and other sales expenses, as the gain
(loss) on sale of real estate properties is recorded in thestatement of income pursuant to Article 48, paragraph
2 of the Regulation on Accounting for Investment
Corporations (Cabinet Office Order No. 47 of 2006).

(Note 1) Revenue from the leasing business subject to the“Accounting Standard for Lease Transactions” (ASBJ
Statement No. 13), dividend income subject to the“Accounting Standard for Financial Instruments”(ASBJ Statement No. 10) and the sale of real estate,etc. subject to the “Practical Guidelines on Accounting
by Transferors for Securitization of Real Estate Using
Special Purpose Companies” (Accounting System
Committee Report No. 15 of the Japanese Institute ofCertified Public Accountants) are not included in“Revenue from contracts with customers” as they are
not covered by the Accounting Standard for Revenue
Recognition. Major revenue from contracts withcustomers is proceeds from sale of real estate
properties.

2. Information utilized as the basis for understanding revenue
from contracts with customers
The information is as described in “Notes Concerning
Significant Accounting Policies” above.

2. Information utilized as the basis for understanding revenue
from contracts with customers
The information is as described in “Notes Concerning
Significant Accounting Policies” above.

3. Information on relationship of fulfillment of performance
3. Information on relationship of fulfillment of performanceobligations based on contracts with customers with cashflow
obligations based on contracts with customers with cashflow
generated from said contracts as well as amount of revenue
generated from said contracts as well as amount of revenue
and period expected to be recognized in the next calculationand period expected to be recognized in the next calculation
period or thereafter from contracts with customers existing
period or thereafter from contracts with customers existingat the end of the fiscal period ended December 31, 2021
at the end of the Reporting Period(1) Balance of contract assets and contract liabilities, etc.
(1) Balance of contract assets and contract liabilities, etc.
(Unit: JPY thousand)(Unit: JPY thousand)Fiscal period ended
December 31, 2021

Fiscal period ended
June 30, 2022

Claims generated from contracts with customers(balance at the beginning of the period)

1,534

Claims generated from contracts with customers(balance at the beginning of the period)

2,114

Claims generated from contracts with customers(balance at the end of the period)

2,114

Claims generated from contracts with customers(balance at the end of the period)

2,250

Contract assets(balance at the beginning of the period)-

Contract assets(balance at the beginning of the period)-

Contract assets(balance at the end of the period)-

Contract assets(balance at the end of the period)-

Contract liabilities(balance at the beginning of the period)-

Contract liabilities(balance at the beginning of the period)-

Contract liabilities(balance at the end of the period)-

Contract liabilities(balance at the end of the period)-(2) Transaction value allocated to remaining performanceobligations
Not applicable(2) Transaction value allocated to remaining performanceobligations
Not applicable- 83 -

[Notes Related to Significant Subsequent Events](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

INV completed the sale of the following properties on
January 12, 2022.

Not applicable

Property Number: A79 Revest Honjin
Sale Date: January 12, 2022

July 2, 2021

Location: Nagoya-shi, Aichi

Sendai-shi, Miyagi

Book Value (Note 1): JPY 569 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei:
Mokuteki Kaisha: Trust beneficiary interest

JPY 590 million

Transferee
Type of Asset

Kubota Holdings
Trust beneficiary interest

Property Number: A80 Revest Matsubara
Sale Date: January 12, 2022

July 2, 2021

Location: Nagoya-shi, Aichi

Sendai-shi, Miyagi

Book Value (Note 1): JPY 559 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei:
Mokuteki Kaisha: Trust beneficiary interest

JPY 590 million

Transferee
Type of Asset

Kubota Holdings
Trust beneficiary interest

Property Number: A82 Alba Noritake Shinmachi
Sale Date: January 12, 2022

July 2, 2021

Location: Nagoya-shi, Aichi

Sendai-shi, Miyagi

Book Value (Note 1): JPY 509 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei:
Mokuteki Kaisha: Trust beneficiary interest

JPY 590 million

Transferee
Type of Asset

Kubota Holdings
Trust beneficiary interest

Property Number: A83 Revest Meieki Minami
Sale Date: January 12, 2022

July 2, 2021

Location: Nagoya-shi, Aichi

Sendai-shi, Miyagi

Book Value (Note 1): JPY 498 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei:
Mokuteki Kaisha: Trust beneficiary interest

JPY 590 million

Transferee
Type of Asset- 84 -

Kubota Holdings
Trust beneficiary interest

Property Number: A88 Luna Court Edobori
Sale Date: January 12, 2022

July 2, 2021

Location: Osaka-shi, Osaka

Sendai-shi, Miyagi

Book Value (Note 1): JPY 457 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei:
Mokuteki Kaisha: Trust beneficiary interest

JPY 590 million

Transferee
Type of Asset

Kubota Holdings
Trust beneficiary interest

Property Number: A98 Little River Honmachibashi
Sale Date: January 12, 2022

January 12, 2022

July 2, 2021

Location: Osaka-shi, Osaka

Osaka-shi, Osaka

Sendai-shi, Miyagi

Book Value (Note 1): JPY 272 million

JPY 457 million

JPY 2,982 million

Sales Price (Note 2): Undisclosed

Undisclosed

JPY 3,660 million

Expected Gain on Sale (Note 3): Undisclosed
Kansai Residence Tokutei
Transferee:
Mokuteki Kaisha
Type of Asset: Trust beneficiary interest(Note 1)
As of December 31, 2021.
(Note 2)
Sale price does not include transfer related cost,adjustments for property taxes or city planning taxes,
or national or local consumption taxes. The saleprice of individual properties is not disclosed as thetransferee’s consent has not been obtained fordisclosure. Accordingly, the expected gain on saleof individual properties is not disclosed either. The
total sale price is JPY 4,450 million and the total
expected gain on sale is 1,454 million for six
properties above.
(Note 3)
Expected gain on sale is calculated by deducting thebook value and estimated transfer related costs fromthe sale price.
(Note 4)For an overview of the sold properties, please refer to“Status of Investment Corporation’s Assets underManagement 3. Asset Portfolio of Real Estate, etc.”of “I. Asset Management Report” as described above.

Undisclosed
JPY 590 million
Kansai Residence Tokutei
Kubota Holdings
Mokuteki Kaisha
Trust beneficiary interest
Trust beneficiary interest[Notes Related to Provision and Reversal of Allowance for Temporary Differences Adjustment](Reference) Fiscal period ended December 31, 2021
(from July 1, 2021 to December 31, 2021)
Not Applicable

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)
Not Applicable- 85 -

VI.

I.

Statement of Cash Distribution

Unappropriated retained
earnings
II . Distributions(Distribution per unit)
III. Retained earnings (deficit)
carried forward
Calculation method of
distribution amount(Reference) Fiscal period ended
December 31, 2021
(from July 1, 2021 to December 31, 2021)

Fiscal period ended June 30, 2022
(from January 1, 2022 to June 30, 2022)

JPY 9,676,221,880

JPY 9,679,301,911

JPY 1,012,075,440
JPY 166

JPY 1,012,075,440
JPY 166

JPY 8,664,146,440

JPY 8,667,226,471

In accordance with the distribution policy
set forth in Article 17, Paragraph 1 of the
Articles of Incorporation of INV, thedistribution amount shall be the amountwhich does not exceed the amount of
profits but exceeds 90% of the distributable
income as defined in Article 67-15 of theSpecialTaxation
MeasuresAct.
However, in the event that any tax losses
arise, or if no profits have been recorded
for tax purposes due to tax losses carriedforward, the distribution amount may be as
reasonably determined by INV. Pursuant
to this policy, INV determined the
distribution
amounttobeJPY
1,012,075,440 out of net income of JPY
1,014,194,343. Moreover, INV does notmake excess profit distribution set forth in
Article 17, Paragraph 4 of the Articles ofIncorporation.

In accordance with the distribution policy
set forth in Article 17, Paragraph 1 of the
Articles of Incorporation of INV, thedistribution amount shall be the amountwhich does not exceed the amount of
profits but exceeds 90% of the distributable
income as defined in Article 67-15 of theSpecialTaxation
MeasuresAct.
However, in the event that any tax losses
arise, or if no profits have been recorded
for tax purposes due to tax losses carriedforward, the distribution amount may be as
reasonably determined by INV. Pursuant
to this policy, INV determined the
distribution
amounttobeJPY
1,012,075,440 out of net income of JPY
1,015,155,471. Moreover, INV does notmake excess profit distribution set forth in
Article 17, Paragraph 4 of the Articles ofIncorporation.

- 86 -

Note
Accompanying English financial information, comprising Balance Sheet, Statement of Income and Retained
Earnings, Statement of Changes in Net Assets, Notes to financial statements and Statement of CashDistribution, have been translated from the Japanese financial statements of INV prepared in accordance with
the Act on Investment Trusts and Investment Corporations of Japan.
Under Article 130 of the Act on Investment Trusts and Investment Corporations of Japan, the Japanesefinancial statements for the six months ended June 30, 2022 have been audited by Ernst & Young ShinNihon
LLC, in accordance with auditing standards generally accepted in Japan. However, English translation of
the Japanese language report of independent auditors is not attached herein since the accompanying English
translation of Balance Sheet, Statement of Income and Retained Earnings, Statements of Changes in Net
Assets, Notes to financial statements and Statement of Cash Distribution is unaudited.
Regarding the English audited financial statements, please refer to the “Audited Financial Statements” on thewebsite of Invincible Investment Corporation: https://www.invincible-inv.co.jp/en/ir/library.html- 87 -

VII. Statement of Cash Flows (Reference Information)

Fiscal period ended
December 31, 2021
(from July 1, 2021 to
December 31, 2021)(Unit: JPY thousand)Fiscal period ended
June 30, 2022
(from January 1, 2022 toJune 30, 2022)

Cash flows from operating activities
Net income before taxes
1,014,799
1,015,760
Depreciation and amortization
3,850,520
3,766,009
Amortization of investment corporation bond issuance costs
6,303
6,200
Loan-related costs
596,446
505,414
Interest income
(70)
(78)
Interest expenses
630,628
590,377
Foreign exchange losses (gains)
9,934
158
Loss (gain) of derivatives
10,520Decrease (increase) in rental receivables(1,053,965)(1,102,461)
Decrease (Increase) in deposits paid
288,475(179,359)
Decrease (increase) in receivable income taxes
3(1)
Decrease (increase) in consumption taxes receivable
365,052
Increase (decrease) in accounts payable(91,712)(511,128)
Increase (decrease) in consumption taxes payable
444,366(490,678)
Increase (decrease) in accounts payable-other(17,672)
26,469
Increase (decrease) in accrued expenses
39,458(48,167)
Increase (decrease) in advances received(39,012)(240,841)
Increase (decrease) in deposits received(2,270)1,583
Decrease in property and equipment in trust due to sale
6,996,756
2,867,202
Others, net(100,064)
116,612Subtotal
12,948,498
6,323,071
Interest income received
70
78Interest expenses paid
(627,312)(593,962)
Income taxes paid
(605)
(605)
Net cash provided by operating activities
12,320,651
5,728,582
Cash flows from investing activities
Payment into time deposits(1,430,000)(2,000,000)
Proceeds from time deposits
630,000
2,000,000
Purchases of property and equipment(79,337)(24,384)
Purchases of property and equipment in trust(511,405)(531,563)
Repayments of tenant leasehold and security deposits in trust(183,308)(35,672)
Proceeds from tenant leasehold and security deposits in trust
46,056
16,777
Payment of tenant leasehold and security deposits(9,998)Other, net(23,203)
Net cash used in investing activities(1,561,196)(574,843)
Cash flows from financing activities
Proceeds from short-term loans payable
61,091,000
27,044,000
Repayments of short-term loans payable(33,533,000)(10,695,000)
Proceeds from long-term loans payable
1,582,000
Repayments of long-term loans payable(33,393,000)(19,922,000)
Borrowing related expenses(527,105)(271,524)
Payment of distributions of earnings(93,221)(1,011,974)
Net cash provided by (used in) financing activities(4,873,327)(4,856,498)
Effect of exchange rate change on cash and cash equivalents
(32)
(158)
Net increase (decrease) in cash and cash equivalents
5,886,095
297,081
Cash and cash equivalents at beginning of period
10,840,044
16,726,139*1
Cash and cash equivalents at end of period
16,726,139
17,023,221(Note) Statement of cash flows is prepared based on the Regulation on the Terminology, Forms, and Preparation Methods ofFinancial Statements (Ministry of Finance Order No. 59 of 1963, as amended) and attached as reference. This
statement of cash flows is not subject to audit by an auditor pursuant to the Article 130 of the Investment Trust Act, andthus has not been audited by an auditor.

- 88 -

[Notes Concerning Significant Accounting Policies] (Reference Information)
By Period
Item
Cash and cash equivalents as stated inStatement of Cash Flows

Fiscal period ended
December 31, 2021
(from July 1, 2021 to
December 31, 2021)
Cash and cash equivalents as stated in
the Statement of Cash Flows consistof cash on hand and cash in trust,
floating deposits, deposits in trust andshort-term investments that are veryliquid and realizable with a maturityof three months or less whenpurchased and that are subject toinsignificant risks of changes invalue.

Fiscal period ended
June 30, 2022
(from January 1, 2022 toJune 30, 2022)
Cash and cash equivalents as stated in
the Statement of Cash Flows consistof cash on hand and cash in trust,
floating deposits, deposits in trust andshort-term investments that are veryliquid and realizable with a maturityof three months or less whenpurchased and that are subject toinsignificant risks of changes invalue.

[Notes to Statement of Cash Flows] (Reference Information)
By Period
Item*1. Relationship between cash andcash equivalents in Statement of
Cash Flows and amounts inaccompanying balance sheet

Fiscal period ended
December 31, 2021
(from July 1, 2021 to
December 31, 2021)(As of December 31, 2021)(Unit: JPY thousand)Cash and bank
12,759,582
deposits
Cash and bank
6,766,557
deposits in trust
Time deposits withover three months(2,800,000)
deposit period
Cash and cash
16,726,139
equivalents- 89 -

Fiscal period ended
June 30, 2022
(from January 1, 2022 toJune 30, 2022)(As of June 30, 2022)(Unit: JPY thousand)Cash and bank
13,794,814
deposits
Cash and bank6,028,407
deposits in trust
Time deposits withover three months(2,800,000)
deposit period
Cash and cash
17,023,221
equivalents

“My Number” is issued to all citizens and residents of Japan and is necessary for taxation purposes oninvestment units. Thus, it is necessary for unitholders to notify their brokerage with their “My
Number.”Usage of “My Number” in investment units-related affairs“My Number” is recorded on the payment record and the payment record is filed with the relevant tax
authority pursuant to laws and regulations.
Major payment record*Payment record regarding cash distribution

Usage of “My Number” also includes taxation-related procedures on investment units. It is necessary
for unitholders to notify your “My Number” to your brokerage, etc.
Inquiries regarding notifying “My Number”⚫
⚫

Unitholders whose investment units are managed in brokerage accounts
Each brokerage
Unitholders who have no brokerage accountTransfer Agent Department, Sumitomo Mitsui Trust Bank, Limited
Toll-free Telephone Number 0120-782-031- 90 -Domestic Portfolio Map (As of August 31, 2022)

No. of Properties(Note 1)126

Others(Note 1)

No. ofResidential
Properties

84

41

1

No. ofHotels(Note 1) Including Sheraton Grande Tokyo Bay Hotel, underlying assets of TMK investment(Note 2) For properties corresponding to the number and their overview,please refer to pages 31-37.

- 91 -

- 92 -

Financial Conditions
INV refinanced bank loans of ¥27.0 billion in total during the June 2022 fiscal period, and refinanced ¥50.2
billion of bank loans in July 2022.
INV has ¥12.6 billion in cash on hand at the end of July 2022, which is more than enough to pay interest
expenses and other payments.

◼ Investment Corporation Bonds
Bonds name

IssuedDate

Term(years)Balance(JPY mn)

AnnualInterest Rate

Rating

1st Series Investment
Corporation Bonds

May 25, 2018

5.0

1,000

0.40%

A (JCR)

2nd Series Investment
Corporation Bonds

May 25, 2018

10.0

1,000

0.80%

A (JCR)

3rd Series Investment
Corporation Bonds

Oct. 12, 2018

5.0

2,000

0.55%

A (JCR)

4th Series Investment
Corporation Bonds

Oct. 28, 2019

5.0

1,000

0.48%

A (JCR)

5th Series Investment
Corporation Bonds

Oct. 28, 2019

10.0

2,000

0.90%

A (JCR)

6th Series Investment
Corporation Bonds

Mar. 13, 2020

10.0

1,200

0.85%

A (JCR)

Total

8,200

◼ Lender Formation (as of August 31, 2022)
Mizuho Bank

21.1%

Fukuoka Bank

0.8%

MUFG

16.3%

Nishi-Nippon City Bank

0.8%

SMBC

16.0%

Kiraboshi Bank

0.4%

SMTB

14.4%

Momiji Bank

0.4%

Citibank

6.6%

Yamaguchi Bank

0.4%

Shinsei Bank

5.3%

The Chukyo Bank

0.4%

DBJ

3.5%

Dai-ichi Life Insurance

0.2%

Resona Bank

2.2%

Kagawa Bank

0.2%

San ju San Bank

1.4%

Tochigi Bank

0.2%

Aozora Bank

1.4%

Kiyo Bank

0.2%

Tokyo Star Bank

1.2%

Ogaki Kyoritsu Bank

0.1%

Nomura TB

1.2%

Hiroshima Bank

0.1%

Aeon Bank

1.0%

REIT Bond

3.4%

Shizuoka Bank

1.0%

- 93 -

◼ LTV (based on appraisal value)(Note 1) and Weighted Average Interest Rate(Note 2)◼ DSCR(Note 3)◼ Rating
Rating Agency

Rating Object

RatingOutlookJapan Credit Rating
Agency, Ltd.

Long-term
Issuer Rating

A

Stable(Note 1)

(Note 2)
(Note 3)Calculated by the following formula: (Interest-bearing debts at the end of the relevant fiscal period, excluding short-term consumption tax loan) / (Total appraisal
value as of the end of the same period). For the preferred equity interest in the TMK which holds Sheraton Grande Tokyo Bay Hotel as an underlying asset, theacquisition price (INV’s investment amount) of such preferred equity interest is deemed as the appraisal value and included. For the Overseas Real Estate TK
Interest the underlying assets of which are “The Westin Grand Cayman Seven Mile Beach Resort & Spa” and “Sunshine Suites Resort”, the acquisition price (INV’s
TK investment amount) of such TK interest is deemed as the appraisal value and included regarding the calculation for “Dec. 2018”. Regarding “Jun. 2019” onward,
calculation is based on the appraisal value as of the end of each fiscal period. USD is converted into JPY amount via the forward exchange rate of USD 1=JPY
110.45 based on the foreign exchange forward contract entered into on July 26, 2018.
Calculated by the following formula: (Total loan amount outstanding at the relevant time multiplied by applicable interest rate at the relevant time for each loans)/ (The loan amount outstanding at the end of each fiscal period).
DSCR is calculated by dividing (i) by (ii) for the relevant period; (i) operating income, as adjusted for depreciation expenses from property rental business and any
loss (gain) on sales of property (ii) scheduled prepayments of loans payable, interest expenses,. Excluded the temporal increase of income due to the change ofinvestment structure regarding overseas assets for the calculation of June 2019 fiscal period.

- 94 -

Overview of Unitholders/Investment Units

Historical Unit Price(Note)

Unit prices indicate the closing price on the TSE market. TSE REIT Index has been indexed, assuming the closing price of TSE REIT Index asof January 4, 2013, as the same as the closing price of INV’s unit on the same day.

Distribution of Unitholders(Note) Percentage figures are rounded to one decimal place.

Annual Schedule- 95 -

Information for Unitholders
For Unitholders
Investors’ Registry
Administrator
Special Account Management
Institution

Correspondence(Telephone Assistance)

Sumitomo Mitsui Trust Bank, Limited
1-4-1, Marunouchi, Chiyoda-ku, Tokyo<Unitholders of the former Tokyo Growth REIT Investment Inc.>
Mitsubishi UFJ Trust and Banking Corporation
1-4-5, Marunouchi, Chiyoda-ku, Tokyo<Unitholders of the former LCP Investment Corporation>
Sumitomo Mitsui Trust Bank, Limited
1-4-1, Marunouchi, Chiyoda-ku, Tokyo
Transfer Agent Department, Sumitomo Mitsui Trust Bank,
Limited
2-8-4, Izumi, Suginami-ku, Tokyo, 168-0063
Toll-free Telephone Number 0120-782-031
Administrative services are available at the main and branch
offices throughout Japan of Sumitomo Mitsui Trust Bank,
LimitedNotification Process for Address Changes
Please notify your brokerage (financial instruments business operator) regarding changes to addresses, names,
registered seals, and the like. Unitholders who have special accounts instead of brokerage accounts should
contact the transfer account management institution (financial instruments business operator) below.
Unitholders of the pre-merger Investment Corporation (former Tokyo Growth REIT Investment Inc.)
Mitsubishi UFJ Trust and Banking Corporation Toll-free Number: 0120-255-100
Unitholders of the former LCP Investment Corporation
Sumitomo Mitsui Trust Bank, Limited
Toll-free Number: 0120-782-031
Dividends
Unitholders may collect “dividends” by submitting the “Dividends Receipt” at your local Japan Post Bankor at the deposit teller of a post office. In the case that the collection period has past, designate a collection
method on the back of the “Dividends Receipt,” and either mail the receipt to the Transfer Agent Departmentof the Sumitomo Mitsui Trust Bank, Limited or collect from a branch teller.
(Bank Transfers)
Should you desire to specify bank transfers for future dividends, please notify your brokerage(financial instruments business operator).
(Note)

Please collect dividends within 3 years of distribution. Please note that payments cannot be made after
3 years due to the rules and regulations of the Articles of Incorporation of the Investment Corporation.

- 96 -

Notification(Notice of Dividend Payment)
The 2008 amendment of the Special Taxation Measures Law (Act No. 23 of April 30, 2008) mandated thesending to unitholders a “Notice of Dividend Payment” stating the dividend amount, amount of taxes
withheld, and the like for dividends payable in and after January 2009. If you collect dividends via a“Dividends Receipt,” please view the “Notice of Dividend Payment” sent alongside it. If you have specified
a wire transfer, the “Dividend Statement” delivered with the dividend payment is the “Notice of Dividend
Payment.”(Characters for Addresses and Names of Unitholders)With the digitization of investment securities, if there are Chinese characters in your address or names that
the Japan Securities Depository Center (JASDEC) has not included in the transfer system, JASDEC registers
them in the Investors’ Registry by converting part or all of the characters to those that JASDEC has includedin the transfer system or to katakana. Please be aware that correspondence may be addressed using
characters that JASDEC has included in the transfer system. Please inquire with your brokerage regarding
characters registered for your address and name.
Inquiries
For inquiries regarding INV: Consonant Investment Management Co., Ltd.
TEL: 03-5411-2731 (Main)
Weekdays 9:00-17:00- 97 -