(Reference) SUMMARY OF FINANCIAL RESULTS (REIT)
For the 4th Fiscal Period Ended August 31, 2017
October 13, 2017
REIT securities issuer:
Representative:

Nomura Real Estate Master Fund, Inc. (“NMF”)
Securities code: 3462
Shuhei Yoshida, Executive Director

Asset management company:
Representative:
Inquiries:

Nomura Real Estate Asset Management Co., Ltd.
Norio Ambe, President and Chief Executive Officer
Kenichi Okada, Head of NMF Investment Management Group

Scheduled date of filing of securities report:
Scheduled date of commencement of distribution payout:
Preparation of supplementary materials on financial results:
Holding of briefing session on financial results:

Stock exchange listing: Tokyo Stock Exchange
URL: http://www.nre-mf.co.jp/en/

TEL: +81-3-3365-8767

November 29, 2017
November 17, 2017
Yes
Yes (for institutional investors and analyst)[Amounts less than one million yen are truncated]

1. Financial Results for the 4th Fiscal Period (from March 1, 2017 to August 31, 2017)(1) Operating Results[% figures are the rate of increase (decrease) compared with the previous period]
Operating revenues
Period ended
August 31,2017
February 28, 2017

million yen
38,13934,714

Operating profit

%
9.9
12.1

Net income
per unit
Period ended
August 31,2017
February 28, 2017

million yen
15,735
11,244

Ordinary income
%
39.9
(3.7)

Return on unitholders’equityyen

million yen
13,190
8,672

%
52.1
(7.3)

Ratio ofordinary income
to total assets

%

3,153
2,072

Net income%

million yen
13,190
8,670

52.1
(7.3)

Ratio ofordinary income
to operating revenues
%

2.4
1.7

%

1.2
0.8

34.6
25.0

(2) Distributions

Period ended
August 31,2017
February 28, 2017

Distribution
per unit(excluding
distribution
in excess of net
income)Total
distributions(excluding
distribution
in excess of
net income)

yen
3,037
2,073

million yen
12,704
8,671

Distribution
in excess of
net income per
unit

Total
distributions
in excess of
net income

yenmillion yen
－
3,994

－
955

Distribution
per unit(including
distribution inexcess of net
income)Total
distributions(including
distribution
in excess of
net income)

3,037
3,028

million yen
12,704
12,666yen

Distribution
payout ratio

Ratio ofdistributions to
net assets

%
96.3
100.0

%
2.2
1.6

(Note 1) Of the ¥955 distribution in excess of net income per unit in the fiscal period ended February 28, 2017, ¥646 is a distribution of the allowance fortemporary difference adjustments and ¥309 is other distributions in excess of net earnings. Furthermore, the ratio of decreasing surplus is 0.003
There was no distribution in excess of net income for the period ended August 31, 2017. See 2. Management Policy and Management Status (2)Management Status ⑤Business Performance and Distributions, below.
(Note 2) Distribution Payout Ratio is calculated using the below formula and truncated at the first decimal place.
Distribution Payout Ratio = Total Distributions (excluding distribution in excess of Net Income) / Net Income × 100(Note 3) Ratio of Distributions to Net Assets is calculated using the below formula and truncated at the first decimal place.
Ratio of Distributions to Net Assets = Distribution Per Unit (excluding distribution in excess of Net Income) / {(Net Assets per Unit at the
beginning of the fiscal period + Net Assets per Unit at the end of the fiscal period) / 2} × 100(3) Financial Position
Period ended
August 31,2017
February 28, 2017

Total assets

Net assets

million yen
1,095,828
1,105,979

million yen
556,649
556,104- 1 -Net assets to total assets

Net assets per unit

%
50.8
50.3

yen
133,069
132,939

(4) Status of Cash FlowsNet cashprovided by (used in)operating activities
Period ended
August 31,2017
February 28, 2017

Net cashprovided by (used in)investing activities

million yen
65,298
14,772

Net cashprovided by (used in)financing activities

million yen(44,666)(13,608)

Cash andcash equivalents
at end of period

million yen(22,735)(13,419)

million yen
71,22773,331

2．Earnings Forecasts for the 5th Fiscal Period (from September 1, 2017 to February 28, 2018)[% figures are the ratio of increase (decrease) compared with the previous period]
Distribution
per unit

PeriodendingFebruary 28,
2018

Operating revenues

Operating profit

Ordinary income

millionyen

millionyen

millionyen

33,365%△12.5

12,504%△20.5

10,016%△24.1(excluding
distribution
in excess of
net income)Net income

millionyen

Distribution
in excess of
net income
per unit

Distribution
per unit(including
distribution
in excess of net
income)

%

yen

yen

yen

10,015 △24.1

2,459

561

3,020

(Reference) Forecast net income per unit for the fiscal period ending February28, 2018 is ¥2,394*Other(1) Changes in Accounting Policies, Changes in Accounting Estimates and Retrospective Restatements① Changes in accounting policies accompanying amendments to accounting standards, etc.:② Changes in accounting policies other than those in ①:③ Changes in accounting estimates:④ Retrospective restatements:

None
None
None
None

(2) Number of Investment Units Issued and Treasury Investment Units① Number of investment units issued (including treasury investment units)
As of August 31, 2017:
4,183,130 units
As of February 28, 2017:
4,183,130 units② Number of treasury investment units
As of August 31, 2017:– units
As of February 28, 2017:– units(Note) For the number of investment units used as the basis for calculation of net income per unit, please refer to“Notes on Per Unit Information” on page 42.
* Status of audit procedure implementation
At the time of the disclosure of this document, audit procedures for financial statements pursuant to the
Financial Instruments and Exchange Act (Act No. 25 of 1948, including subsequent amendments) have notbeen completed.
* Forward-looking statements
The earnings forecasts and other forward-looking statements contained in this document are based on
information currently available to and certain assumptions deemed reasonable by NMF. Accordingly, actual
earnings performance and other results may differ materially due to a variety of factors. Furthermore, suchforward-looking statements do not constitute a guarantee of future distributions. For more information about
the assumptions underlying forward-looking statements and the use of such statements, please refer to“Assumptions Underlying Earnings Forecasts for the 5th Fiscal Period (Ending February 28, 2018)” on page 9.

This is an English language translation of the original Japanese announcement of the financial statements(“Kessan Tanshin”). This translation is provided for information purpose only. Should there be any discrepancy
between this translation and the Japanese original, the Japanese original shall prevail.
- 2 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Attachment
1. Related Corporations of the Investment Corporation
Disclosure is omitted because there are no significant changes from the information presented under“Structure of the Investment Corporation” in the most recently published securities report (published May 29,2017).
2. Management Policy and Management Status(1) Management Policy
Disclosure is omitted, since there are no significant changes from the “Investment Policy,” “Investment
Targets” and “Distribution Policy” presented in the securities report (filed on May 29, 2017).
(2) Management Status① Outline of Fiscal Period under Review
NMF’s basic policy is to manage its assets mainly as investments in real estate, etc. (meaning the assets
specified in the Ordinance for Enforcement of the Act on Investment Trusts and Investment Corporations(Prime Minister’s Office Ordinance No. 129 of 2000, including subsequent amendments)), specifically realestate, leaseholds of real estate, surface rights, and the beneficial interests of trusts formed by entrustmentof only these assets, to secure stable income over the medium to long term and steady growth of assets
under management (Note 1). In order to realize this basic policy, NMF adopts an investment strategy that
centers on the Greater Tokyo area (Tokyo, Kanagawa, Chiba and Saitama prefectures), which offers strong
tenant demand, while also considering regional diversification through investment in all of Japan’s threemajor metropolitan areas and other major cities. By combining the “diversified type strategy,” in whichinvestments are made in a variety of facilities, such as offices, retail facilities, logistics facilities andresidential facilities, with the “large-scale REIT strategy,” which increases portfolio stability throughproperty and tenant diversification, as well as the “leasing value chain” with the sponsor, the Nomura Real
Estate Group, NMF aims to increase unitholder value by securing stable income over the medium to longterm and the steady growth of assets under management.
In November 2015, NMF formulated and announced its medium- to long-term management strategy.
During the management strategy’s initial quality phase, from NMF’s establishment on October 1, 2015, tothe end of the 4th fiscal period, NMF sold 27 properties for a total of ¥81.5 billion, greatly surpassing its
target for this phase of ¥50 billion. NMF also acquired 19 properties, mainly from the sponsor, Nomura
Real Estate Development Co., Ltd., for a total of ¥83.4 billion. These asset replacements improved thequality of NMF’s portfolio. NMF also targeted internal growth in upside sectors(Note 2). As a result, thedistribution per share rose from ¥2,656 in the first fiscal period (when recalculated for a six-month period(Note 3)) to ¥3,037 for the 4th fiscal period.
(Note 1) Throughout this document, “assets under management” refers to assets that belong to NMF.
Furthermore, “Real estate, etc.” refers to assets defined in Article 29, Paragraph 1 (1) or (2) of NMF’s Articles of Incorporation, and “realestate backed securities” refers to assets defined in Article 29, Paragraph 1 (3) of NMF’s Articles of Incorporation (“Real estate, etc.” and“real estate-backed securities” are hereinafter collectively referred to as “real estate-related assets”).
Real estate and the underlying real estate of real estate-related assets are together referred to as the “real estate under management” or“properties.”(Note 2) Upside sectors refer to sectors for which an increase of rental revenue can be expected, particularly offices as well as retail facilities instation areas.
(Note 3) The above figure is recalculated for a six-month fiscal period based on the actual distribution per unit of ¥2,219 for the first fiscal period,
and the number of days in the first fiscal period, 152② Investment Environment
The Japanese economy has continued to gradually improve, backed by increased exports and recovery inproduction due to improvement in the global economy. In 2017, growth is expected to continue, as
projections call for foreign demand staying strong while ongoing monetary easing provides support fordomestic demand. However, movement toward increasing interest rates and reducing asset holdings by
central banks around the world, growing uncertainty regarding the policies of the United States, andeconomic conditions in China could potentially lead to a deceleration in the global economy and thus
remain causes for concern. Furthermore, conditions surrounding North Korea and other geopolitical risks
require careful attention.
In the J-REIT market, conditions remain favorable for raising funds through borrowing, as interest rates
have stayed low. Fundraising through borrowing in the first six months of 2017 exceeded that in the same
- 3 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

period of the previous year.
With regard to the office leasing market, the vacancy rate continued to gradually decline. Rents continued
to rise, albeit slowly, as the market tightened, reflecting firm demand for increased floor space andexpansion in existing buildings. Going forward, the overall office rental market balance is expected toremain largely unchanged, with limited new supply and demand for increased floor space supported by
improving corporate results as a result of economic recovery. However, in 2018 and onward, emerging
secondary vacancies due to increasing supply and changes in office demand will require ongoing carefulattention.
Concerning the environment surrounding retail facilities, the overall pace of recovery in retail has
remained slow due to stagnant individual consumption and frugal household spending, negatively affecting
sales at suburban retail facilities. Rents in major urban retail areas had been rising but now seem to haveentered a lull. Going forward, consideration must be given to the impact on market rents of the upcoming
completions of new large-scale retail facilities around the country.
In terms of logistics facilities, overall demand has been steady, due in part to firm sales reported bythird-party logistics providers (Note), NMF’s main logistics facility tenants, and online shopping outlets.
However, increasingly serious personnel shortages at tenant companies are driving up shipping rates, which
may negatively impact shipping volumes and demand for logistics facilities going forward. Furthermore, thepossibility of local demand imbalances due to a forecast increase in logistics facility development projects in
the greater Tokyo area and Kinki area is a cause for concern.
(Note)

Third-party logistics (3PL) refers to logistics services outsourced by shippers for part or all of their logistics functions.

Concerning the environment surrounding the rental apartment market, as the Greater Tokyo Area andother major urban areas continue to see net population inflow, both the existing stock and new supply ofhigh-quality rental condominiums in prime locations are low. Reflecting these conditions, the overall
occupancy rate of J-REIT-owned rental condominiums remains high. Rents are forecast to follow a gentle
upward trajectory for the time being, backed by tight supply, strong demand and improving incomes. Thatsaid, the growing supply of newly built rental housing in suburban areas could indirectly exert a negative
effect on the market, and market trends in areas with lax regulations on one-room apartments and areas
with increasing numbers of apartments are a potential reason for caution.
In the real estate transaction market, overall investor appetite remains strong, but prices have remained
high, with growing indications of overheating in competition to acquire properties. While the current
market balance is expected to remain largely unchanged for some time under the accommodative financial
environment, if uncertainty in domestic and foreign financial markets arises or risk avoidance grows more
pronounced, changes in the funding environment could lead to diminished appetite for investment.

③ Management Performance
Under the circumstances described above, during the 4th fiscal period, NMF acquired eight properties(nORBESA, Nakaza Cui-daore Building, NRE Kichijoji Building (additional 49.0% quasi co-ownershipstake in the beneficial interest in a real estate trust), Landport Kashiwa Shonan I, PRIME URBAN Gakugei
Daigaku Parkfront, Proud Flat Omori III, Proud Flat Kinshicho and Summit Store Naritahigashi (Land);total acquisition price: ¥38,995 million). Also during the 4th fiscal period, NMF sold 11 properties (NOF
Nihonbashi Honcho Building (51% quasi co-ownership stake in the beneficial interest in a real estate trust),
NOF Technoport Kamata Center Building, Tennozu Park Side Building, Mitsubishi Motors Shibuya,
Mitsubishi Motors Suginami, Ito-Yokado Higashi-Narashino Store, Merad Owada, Ota Nitta Logistics
Center, Ota Higashishinmachi Logistics Center, Ota Kiyohara Logistics Center and Chiyodamachi Logistics
Center; total sale price: ¥47,414 million. As a result, at the end of the fiscal period under review, NMF held
268 properties (total acquisition price: ¥927,318 million), the ratio of investment in the Greater Tokyo area
was 82.0%, the gross leasable area of the portfolio was 1,847,370.18 m2, and the portfolio remained highly
diversified.
Furthermore, since the close of the 4th fiscal period (August 31, 2017), NMF has acquired four
properties developed by the sponsor, Nomura Real Estate Development Co., Ltd., effective September 29,
2017 (PMO Hirakawacho, PMO Shinnihonbashi, GEMS Kanda and GEMS Daimon; total acquisition price:¥11,410 million). On the same date, NMF sold Morisia Tsudanuma (sale price: ¥18,000 million), which it
expected to see decline in competitiveness due to age and increasing maintenance and management costs.
- 4 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

In terms of property and facility management, as described above in “① Investment Environment,”
rental demand is expanding, backed by the gradual recovery of the Japanese economy. Accordingly, theoccupancy rate of the entire portfolio as of the end of the fiscal period under review was stable and high, at
98.4%. In the office sector, a key upside sector, the rental market has seen particularly notable recovery, withrises in newly advertised rents and successful rent increases upon contract renewal driving the internal
growth of the portfolio as a whole.
④ Status of Fund Procurement
During the fiscal period under review, NMF took out loans of ¥8,700 million and ¥18,000 million on
March 16, 2017 and March 30, 2017, respectively, to partially cover capital requirements for the acquisitionof specified assets and related expenses. Furthermore, using cash on hand generated by the sale of assets,
NMF repaid a total of ¥36,700 million in existing loans. NMF also refinanced interest-bearing liabilities
with approaching maturities of ¥50,070 million (including ¥5,000 million in investment corporation bonds).
To secure a stable financial base, NMF extended its existing ¥10,000 million commitment line agreement
for an additional year, established a new one-year ¥40,000 million commitment line agreement, andestablished a one-year ¥30,000 million uncommitted line of credit. (including borrowings taken out in the
period under review as part of the abovementioned financing).
As a result, the balance of interest-bearing liabilities at the end of the fiscal period under review was¥488,741 million, and the ratio of interest-bearing liabilities to total assets (LTV) was 44.6%.
NMF’s ratings at the end of the fiscal period under review are shown below. These ratings do not
represent judgments on NMF investment units. Concerning NMF investment units, there are no credit
ratings that credit rating agencies have provided or made available for inspection, nor are there credit ratings
that credit rating agencies are scheduled to provide or make available for inspection at the request of NMF.

Credit rating agency

Rating description

Note

Japan Credit Rating Agency, Ltd. (JCR)

Long-term issuer rating:AA

Rating outlook:

StableRating and Investment Information, Inc.
(R&I)

Issuer rating:A+

Rating outlook:

StableA

Rating outlook:

S&P Global Ratings Japan Inc. (S&P)

Long-term corporate credit
rating:Short-term corporate credit
rating:Stable- 5 -A-1

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

⑤Business Performance and Distributions
In the 4th fiscal period, operating revenues totaled ¥38,139 million, operating profit reached ¥15,735
million, ordinary income totaled ¥13,190 million, and net income came to ¥13,190 million. NMF calculates
cash distributions in accordance with the cash distribution policies specified in Article 36 paragraphs 1 and
2 of NMF’s Articles of Incorporation.
For the fiscal period under review, NMF decided to implement ¥12,704 million in distributions, for a
distribution per unit of ¥3,037. This figure was calculated as ¥13,190 million in net income after taxes plus
¥2,622 million in amortization of goodwill minus ¥3,107 million in gains on sale of real estate minus the
portion for which per-unit distributions would be less than ¥1.
The entire amount of ¥12,704 million, the amount of distributions calculated as described above, will be
paid out as distributions of earnings, as said amount does not exceed net income as defined in Article 136of the Act on Investment Trusts and Investment Corporations (Act No. 198 of 1951, hereinafter theInvestment Trust Act). Accordingly, there is no distribution in excess of net income for the fiscal period
under review. Note that the ¥3,107 million gain on sales of real estate recorded in the 4th fiscal period will
be designated as retained earnings to facilitate stable operations over the medium and long terms. In part
because the sale concerned was of a property with a greater tax-adjusted carrying value than book-adjusted
carrying value, said retained earnings do not violate the relevant conduit requirements and will not be taxed.
⑥ Outlook for Next Fiscal Period
Under the conditions described above in ② Investment Environment, since its establishment, NMF has
been implementing the initial quality phase of its medium- to long-term management strategy, implementing
SPRs to enhance portfolio quality and fostering internal growth, mainly in upside sectors as it expanded its
assets. However, with the property sale described below under ⑦ Significant Subsequent Events A. Assetsales a. Morisia Tsudanuma, NMF has largely completed its SPR property dispositions. Furthermore, NMF
will therefore transition to the strategy’s second phase, the growth phase.
Beginning in the 5th fiscal period, as initiatives of the growth phase, NMF will target external growth byleveraging the Nomura Real Estate Group’s property development capabilities and internal growth bymaking maximum use of the property management pipeline with a focus on strengthening its property
brands. By doing so, NMF aims to maintain the portfolio’s high quality while pursuing growth in order tosecure stable income over the medium to long term and the steady growth of assets under management andthus increase unitholder value.
Furthermore, as of September 1, 2017, NMF has changed its asset management fee scheme, adopting ascheme that links asset management fees to net income for each fiscal period. This change will promoteincreased consideration of unitholder interests in management by enhancing the link between said interests
and asset management fees.
⑦ Significant Subsequent Events
Ａ．Transfer of the asset
NMF reached an agreement to sell and sold the following asset after the conclusion of the 4th fiscal
period (August 31, 2017).
(a). Morisia Tsudanuma
 Type of asset
Trust beneficiary interest in mainly real estate Use
Retail facility
 Contract date
September 29, 2017
 Transfer date
September 29, 2017
 Transfer price¥18,000 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 5th fiscal period earnings¥3 million(Scheduled)
The impact of (a), above, on earnings for the 5th fiscal period (September 1, 2017 to February 28, 2018)
will be recorded as gain on sales of real estate under operating revenues.

- 6 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Reference)
A. Property acquisition
NMF decided to acquire the assets stated below on September 26, 2017, concluding the acquisition on
September 29, 2017. Because these acquisitions and the above noted sale of Morisia Tsudanuma under⑦ Significant Subsequent Events are between the same parties, said parties settled the account basedon the difference between the acquisition and sale prices. Accordingly, Nomura Master Fund received
from the seller a lump sum consisting of the full sale price of Morisia Tsudanuma, less the fullacquisition prices of the four properties acquired, listed below.
Property namePMO Hirakawacho

PMO Shinnihonbashi

Type of asset

Real estate

Real estate（Registry）（Registry）
Location (Note 1)

4-11-2 Nihonbashi-Honcho, Chuo Ward,
2-7-6 Hirakawacho, Chiyoda Ward, Tokyo andTokyo and 2 other lots
2 other lots
（Street）（Street）

2-7-3 Hirakawacho, Chiyoda Ward, Tokyo

4-3-6 Nihonbashi-Honcho, Chuo Ward,
Tokyo

Structure (Note 1)

S 10F

S/SRC B1F/9F

Land area (Note 1)

307.79㎡

552.11 m2 (owned portion: 473.11 m2;
leased portion: 79.00 m2)

Floor area (Note 1)

2,402.91㎡

3,721.63 m2

Type of ownership（Land）Ownership（Building）Ownership（Land）Ownership, leasehold（Building）Ownership

January 29, 2016

November 30, 2016

¥3,410 million¥4,440 million

September 29, 2017
(Date of agreement on purchase and sale of real

September 29, 2017
(Date of agreement on purchase and sale of realestate)estate)Date of acquisition

September 29, 2017
(Date of delivery of real estate)

September 29, 2017
(Date of delivery of real estate)

Seller

Nomura Real Estate Development, Co., Ltd.

Nomura Real Estate Development, Co., Ltd.

Property nameGEMS Kanda

GEMS Daimon

Type of asset

Real estate

Real estate

Location (Note 1)（Registry）
1-4-3 Kajicho, Chiyoda Ward, Tokyo and 2other lots
（Street）
1-9-19 Kajicho, Chiyoda Ward, Tokyo（Registry）
1-401-1 Daimon, Minato Ward, Tokyo and3 other lots
（Street）
1-15-3 Daimon, Minato Ward, Tokyo

Structure (Note 1)

S/SRC B1F/8F

S/SRC B1F/9F

Land area (Note 1)

198.73 m2

241.43 m2

Floor area (Note 1)

1,177.49 m2

1,387.89 m2

Type of ownership（Land）Ownership（Building）Ownership（Land）Ownership（Building）Ownership

Completion date
(Note 1)

June 15, 2016

February 15, 2016

Completion date
(Note 1)
Acquisition price(Note 2)
Date of agreement- 7 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Acquisition price¥1,500 million¥2,060 million

September 29, 2017
(Date of agreement on purchase and sale of real

September 29, 2017
(Date of agreement on purchase and sale of realestate)estate)Date of acquisition

September 29, 2017
(Date of delivery of real estate)

September 29, 2017
(Date of delivery of real estate)

Seller

Nomura Real Estate Development, Co., Ltd.

Nomura Real Estate Development, Co., Ltd.

(Note 2)
Date of agreement(Note 1) Location (registry), Structure ,Completion Date, and LandArea ,Floor area are based on the information in the realestate registry.
(Note 2) The acquisition price stated is that given on the real estate sale contract and does not include acquisition-related costs(property and other taxes, etc.).

- 8 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Assumptions Underlying Earnings Forecasts for the 5th Fiscal Period (Ending February 28, 2018)
Item
Calculation period

Assumptions
・5th fiscal period: September 1, 2017 to February 28, 2018

・With respect to the 271 properties held by NMF as of this document’s publication, it isassumed that there will be no changes in assets under management (new property
Assets Under Management
acquisitions or sales of portfolio properties) through February 28, 2018.
・The forecasts may be revised due to actual changes in the portfolio or other reasons.
・Rental revenues are estimated based on tenant trends, competitive properties located inadjacent areas and real estate market conditions, among other factors, with theassumption that there exist no arrears or cases of nonpayment with regard to the
Operating revenues
properties.
・Gain on sales of real estate are expected to be ¥3 million.
・Real estate rental expenses are expected to be ¥ 14,652 million.
・It is estimated that a tax amount of ¥2,700 million will be recorded as real estate rental
expenses. In general, previous owners are reimbursed for the property taxes and city
planning taxes for the period starting from the time NMF acquires the assets. However,
NMF does not allocate such reimbursement as its expenses, because an amountequivalent to such reimbursement is included in the cost of acquisition and is capitalized.
・Estimated property management costs (including building management fees and property
management fees) of ¥2,987 million are expected to be recorded as real estate rental
Operating expenses
expenses(excluding amortization ・Expenses for repairs and maintenance required for the fiscal period are calculated as real
expenses for goodwill)
estate rental expenses, based on the mid-to-long term repair plans that NMF’s AssetManagement Company has established. However, the actual expenses for repairs andmaintenance for the fiscal period may differ significantly from estimates due to expenses
for urgent repairs of damages to a building caused by events difficult to foresee,
significant year-on-year fluctuations in costs or non-periodic repair expenses.
・Depreciation of ¥ 4,752 million is expected to be recorded as real estate rental
expenses.
・Other operating expenses (including asset management fees, asset custody fees andgeneral administration fees) are estimated at ¥ 3,586 million.
・Goodwill will be amortized using the straight-line method over 20 years pursuant to theBusiness Combination Accounting Standards. Goodwill amortization expenses are
expected to be ¥2,622 million.
Amortization expenses ・Goodwill amortization expenses is an item that causes a difference between accounting
for goodwill
and tax treatment and may result in the imposition of corporation tax or other tax.
NMF intends to make distributions in excess of net income for the purpose of securing
tax relief during the goodwill amortization period, and it is expected that NMF will beable to avoid such taxation.
・Interest expenses and other borrowing-related expenses are estimated to be ¥ 2,479
Non-operating expenses
million.
・As of today, the outstanding interest-bearing liabilities of NMF are ¥ 488,741 million,
consisting of ¥ 466,241 million in outstanding borrowings and ¥22,500 million in
investment corporation bonds.
・Regarding the portion of the borrowings and investment corporation bonds (¥20,862
million and ¥4,000 million, respectively) that will come due by February 28, 2018 (theInterest-bearing liabilities
end of the 5th fiscal period), it is assumed that NMF will make scheduled and partial
repayments of ¥42 million using cash on hand and refinance the remainder usingborrowings.
・It is assumed that, through February 28, 2018 (the end of the 5th fiscal period), there will
be no changes in the amount of the outstanding interest-bearing liabilities, other than
- 9 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Item

Assumptions
those stated above.

・NMF assumes that there will be no changes in the number of investment units issued
and outstanding as of the date of the publication of this document, 4,183,130 units,
Investment units
and there will be no additional issuance of new investment units through February 28,
2018 (the end of the 5th fiscal period).
・The distribution per unit is calculated according to the distribution policy outlined in
NMF’s Articles of Incorporation.
・NMF assumes that, of the allowance for temporary difference adjustments (hereinafter“ATA”) accrued up to the present, the amount eliminated in the 5th fiscal period (¥38
million) will be reversed from retained earnings at end of period.
・NMF assumes that there will be no change in the 5th fiscal period to the ¥1,524 million
in deferred losses on hedges of interest rate swaps recorded under valuation andtranslation adjustments continuing from the 4rd fiscal period (ended August 31, 2017).
Distribution per unit
The per-unit distribution (excluding the distribution in excess of net income per unit) is
calculated by subtracting this amount from the distributable amount.
・NMF assumes that ¥3 million, equivalent to gain on sales of real estate, will be designatedas retained earnings.
・The per-unit distribution may vary due to various factors, including changes in theinvestment portfolio, changes in rent income caused by tenant replacements, andunforeseen repairs.
・The amount of distribution in excess of net income is estimated on the assumption NMF
will distribute the amount of valuation and translation adjustments deducted from thetotal difference between accounting and tax treatment and the distributable amount as
ATA for the purpose of tax relief. The estimate is based on the assumption that, inorder to alleviate the impact on distributions of the amortization of goodwill and othermerger-related expenses (the “Merger Expenses”) and the reversal of ATA, if the total
difference between accounting and tax treatment and for the relevant fiscal period is lessthan the sum of the Merger Expenses and the reversal of allowance for temporary
Distribution per unit indifference adjustments, NMF will make other distributions in excess of net income in anexcess of earnings peramount not exceeding this difference and within the limit prescribed by the regulations
unitof the Investment Trusts Association, Japan (the “Investment Trusts Association Japan
Regulations”) (the amount equivalent to 60/100 of the total amount of accumulated
depreciation recorded as of the end of the relevant fiscal period less the total amount ofaccumulated depreciation recorded as of the end of the immediately preceding fiscal
period).
・The distribution in excess of net earnings per unit for the 5th fiscal period is expected tobe ¥561, comprising ¥295 in distributions of ATA and ¥266 in other distributions inexcess of net earnings.
・It is assumed that there will be no amendments in legislation, taxation, accounting
principles, listing requirements, the regulations of the Investment Trusts Association,
Other
Japan or other laws or regulations that would affect the above forecasts.
・It is assumed that there will be no unexpected material changes in general economic
conditions and real estate markets.

- 10 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

3. Financial Statements(1) Balance Sheet
Thousands of Yen
As of February 28, 2017

As of August 31, 2017

Cash and bank deposits

59,843,132

58,143,774

Cash and bank deposits in trust

13,487,906

13,083,900

Rental receivables

464,183

787,203

Prepaid expenses

722,575

778,510

Income taxes receivable－
147,670

55

Consumption taxes receivable
Other

514,880－
511,026

75,180,347

73,304,471

112,383,669

118,103,608

Less accumulated depreciation(4,798,964)(6,534,321)

Buildings, net

107,584,705)
350,886

111,569,286

Less accumulated depreciation(98,717)(135,600)

Structures, net

252,168

266,517591,581597,359

Less accumulated depreciation(172,580)(235,885)

Machinery, net

419,001

361,473

109,030

143,822

Less accumulated depreciation(13,537)(23,985)

Equipment, net

95,493

119,836

Land

193,986,142

214,805,613

Buildings in trust

195,623,428

187,039,446(14,025,227)(15,656,794)

AssetsCurrent assets

Total current assets
Noncurrent assets
Property and equipment
Buildings

Structures

Machinery

EquipmentLess accumulated depreciation
Buildings in trust, net*3

Structures in trust

181,598,200

402,117*3

171,382,651

941,049

950,998

Less accumulated depreciation(560,164)(626,012)

Structures in trust, net

380,885

324,986

168,606

231,240

Less accumulated depreciation(14,365)(24,552)

Machinery in trust, net

Machinery in trust

154,240

206,688

Tools, furniture and fixtures in trust

388,097

466,104

Less accumulated depreciation(68,628)(105,141)

Tools, furniture and fixtures in trust, net

319,468

360,962

Land in trust*3

Leased assets

435,437,175*3

415,162,899

24,49423,900Less accumulated depreciation(11,386)(14,950)

Leased assets, net

13,1088,950

Construction in progress

22,1795,229

920,262,769

914,575,096

Total property and equipment- 11 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Thousands of Yen
As of February 28, 2017

As of August 31, 2017

Intangible assets
Goodwill

98,698,194

96,075,951

Leasehold rights

951,943

951,943

Leasehold rights in trust

7,629,150

7,628,763

36,86733,060107,316,156

104,689,719

Long-term prepaid expenses

1,600,245

1,692,616

Long-term deposits

533,241

566,019

Security deposits

956,753945,753

Derivatives Assets

108,61235,372

Total investments and other assets

3,198,853

3,239,761

1,030,777,780

1,022,504,578

21,03819,666

21,03819,666

1,105,979,166

1,095,828,716

Other
Total intangible assets
Investments and other assets

Total noncurrent assets
Deferred assets
Investment corporation bond issuance costs
Total deferred assets
Total assets- 12 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

As of February 28, 2017
Liabilities
Current liabilities
Trade accounts payable
Short-term debt
Current portion of investment corporation bonds
Current portion of long-term debt
Lease obligations in trust
Other accounts payable
Accrued expenses
Accrued income taxes
Accrued consumption taxes
Rent received in advance
Unearned revenue
Derivatives liabilities
Other current liabilities
Total current liabilities
Long-term liabilities
Investment corporation bonds
Long-term debt
Lease obligations in trust
Long-term advances received
Security deposits from tenants
Security deposits from tenants in trust
Derivatives liabilities
Total long-term liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
SurplusCapital surplus
Deductions from capital surplus
Allowance for temporary difference adjustments
Other deductions from capital surplus
Total deduction from capital surplus
Capital surplus, net
Retained earnings
Total surplus
Total unitholders' equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Valuation and translation adjustments
Total net assets
Total liabilities and net assets*1

3,078,364*1

69,975,600
8,651
2,294,599
361,542
1,549

*3

*4

*2

- 13 -

2,410,374
5,000,000
9,000,000

Thousands of Yen
As of August 31, 2017－
4,000,000－
5,083,681
366,627
98,865297,925
94,899,417

54,760,600
6,630
1,536,890
333,666605
1,227,566
4,942,249
300,134
50,648299,281
70,536,637

18,500,000
396,308,400
5,395
713,1908,776,373
29,116,596
1,555,380
454,975,337
549,874,755

18,500,000
411,480,600
2,956
574,827
9,107,525
27,467,719
1,509,405
468,643,035
539,179,673*3

161,883,752

162,592,573

394,012,959

394,012,959(5,374,246)(3,800,508)*4(7,367,727)(5,801,916)(9,174,754)
384,838,204
10,928,087
395,766,292
557,650,045(13,169,643)
380,843,315
14,737,836
395,581,151
558,173,725(1,545,633)(1,545,633)
556,104,411
1,105,979,166(1,524,682)(1,524,682)
556,649,043
1,095,828,716*2

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(2) Statement of Income and Retained Earnings
Previous period
from Sep. 1, 2016
to Feb. 28, 2017

Operating revenues
Rental revenues
Other rental revenues
Gain on sales of real estate
Total operating revenues
Operating expenses
Real estate rental expenses
Impairment loss
Asset management fees
Asset custody fees
Administrative service fees
Directors' compensation
Merger expenses
Amortization of goodwill
Other operating expenses
Total operating expenses
Operating profit
Non-operating revenues
Interest income
Reversal of dividends payable
Interest on refund
Other non-operating revenues
Total non-operating revenues
Non-operating expenses
Interest expenses

*1
*1

*1
*2

Interest expenses on investment corporation bonds
Amortization of investment corporation bondissuance costs
Loan arrangement fees
Other non-operating expenses
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes—current
Total income taxes
Net income
Retained earnings brought forward
Retained earnings at end of period- 14 -

Thousands of Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017

31,730,411
2,984,567－
34,714,978

*1
*1
*3

31,656,774
3,375,225
3,107,662
38,139,662

15,791,521
269,797
2,783,114
48,740155,545
7,200
1,374,890
2,622,242
417,131
23,470,183
11,244,795*1

15,962,925*2－3,063,128
56,591
174,470
7,200－
2,622,242
517,291
22,403,849
15,735,812

357
23,390
1
82
23,832

365
23,673852
48
24,9391,886,020
279,332

1,950,878
206,638

1,372

1,372

423,7825,560
2,596,068
8,672,559
8,672,559
1,604
1,604
8,670,955
2,257,132
10,928,087

405,7495,310
2,569,949
13,190,803
13,190,803
605
605
13,190,198
1,547,638
14,737,836

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(3) Statement of Changes in Net Assets
Previous period (from September 1, 2016 to February 28, 2017)

Unitholders'
capitalBalance at the beginning of
the period
Changes of items during
the period
Increase by merger
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodCapitalsurplusThousands of Yen
Unitholders' equity
SurplusCapital surplus
Total deduction from capital surplus
Allowance
Deduction
Total
Net capitalforfrom otherdeduction
surplustemporary
capitalfrom capitaldifference
surplussurplusadjustment

161,120,405

315,299,775(6,137,594)(941,668)(7,079,263)

308,220,511－

78,713,184

－

－

－

78,713,184

－

－

－

－

－

－

763,347－

763,347(763,347)

－

－

－

－

－

(2,095,491)(2,095,491)(2,095,491)

－

－

－

－

－

－

－

－

－

－

－

－

763,347

78,713,184

763,347(2,858,839)(2,095,491)

76,617,692(*1)161,883,752

394,012,959(5,374,246)(3,800,508)(9,174,754)

384,838,204- 15 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Valuation and translation
adjustments

Unitholders' equity
Surplus

Balance at the beginning of
the period
Changes of items during
the period
Increase by merger
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodTotalunitholders'equityDeferred
gains orlosses onhedgesValuationandtranslation
adjustments

Total net
assetsRetainedearnings

Total surplus

12,225,011

320,445,523

481,565,928(2,254,454)(2,254,454)

479,311,473－

78,713,184

78,713,184－－

78,713,184(9,204,530)(9,204,530)(9,204,530)－－(9,204,530)(763,347)(763,347)

－

－

－

－

－

(2,095,491)(2,095,491)－－(2,095,491)

8,670,955

8,670,955

8,670,955－－

8,670,955－－－

708,820

708,820

708,820(1,296,923)

75,320,768

76,084,116

708,820

708,820

76,792,937

10,928,087

395,766,292

557,650,045(1,545,633)(1,545,633)

556,104,411- 16 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Current period (from March 1, 2017 to August 31, 2017)

Unitholders'
capitalBalance at the beginning of
the period
Changes of items during
the period
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Distributions in excess
of net earnings fromallowance for temporary
diccerence adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodThousands of Yen
Unitholders' equity
SurplusCapital surplus
Total deduction from capital surplus
Allowance
Deduction
Total
Net capitalforfrom otherdeduction
surplustemporary
capitalfrom capitaldifference
surplussurplusadjustment

Capitalsurplus161,883,752

394,012,959(5,374,246)(3,800,508)(9,174,754)

384,838,204

－

－

－

－

－

－

708,820－

708,820(708,820)

－

－

－

－

(2,702,301)－(2,702,301)(2,702,301)

－

－

－

(1,292,587)(1,292,587)(1,292,587)

－

－

－

－

－

－

－

－

－

－

－

－

708,820－(1,993,481)(2,001,407)(3,994,889)(3,994,889)(*1)162,592,573

394,012,959(7,367,727)(5,801,916)(13,169,643)

380,843,315- 17 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Valuation and translation
adjustments

Unitholders' equity
Surplus

Balance at the beginning of
the period
Changes of items during
the period
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Distributions in excess
of net earnings fromallowance for temporary
diccerence adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodTotalunitholders'equityDeferred
gains orlosses onhedgesValuationandtranslation
adjustments

Total net
assetsRetainedearnings

Total surplus

10,928,087

395,766,292

557,650,045(1,545,633)(1,545,633)

556,104,411(8,671,628)(8,671,628)(8,671,628)－－(8,671,628)(708,820)(708,820)

－

－

－

－

－

(2,702,301)(2,702,301)－－(2,702,301)－(1,292,587)(1,292,587)－－(1,292,587)

13,190,198

13,190,198

13,190,198－－

13,190,198

－

－

－

20,951

20,951

20,951

3,809,748(185,140)

523,680

20,951

20,951

544,631

14,737,836

395,581,151

558,173,725(1,524,682)(1,524,682)

556,649,043- 18 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(4) Statement of Cash Distributions
Yen
Previous period
from Sep. 1, 2016
to Feb. 28, 2017
10,928,087,899

Current period
from Mar. 1, 2017
to Aug. 31, 2017
14,737,836,769

II. Distributions in excess of retained
earnings
Of which, allowance fortemporary difference adjustments
Of which, other distributions inexcess of net earnings

3,994,889,150－

2,702,301,980－

1,292,587,170－

III. Incorporation into unitholders'capital
Of which, reversal of allowancefor
temporarydifference
adjustments

708,820,764
708,820,764

198,551,954
198,551,954

IV. Distributions[Distributions per unit]
Of which, distributions of earnings[Of which, distributions ofearnings per unit]
Of which, allowance temporary
difference adjustments[Of which, distributions in excess
of retained earnings per unit [ofallowance for temporary difference
adjustments] ]Of which, other distributions inexcess of net earnings[Of which, distributions in excess
of retained earnings per unit [ofother distributions in excess of net
earnings] ]12,666,517,640(3,028)8,671,628,490(2,073)

12,704,165,810(3,037)
12,704,165,810(3,037)2,702,301,980

－

(646)

－

1,292,587,170

－

(309)

－

V. Retained earnings carried forward

1,547,638,645

1,835,119,005

Calculation method for distributions

Concerning distributions for the 3rd
fiscal period, NMF decided the
distribution per unit will be ¥3,028.
In order to maximize the distributionof earnings included in deductible
expenses by applying special measures
for tax treatment (Article 67-15
Paragraph 1 of the Act on Special
Measures Concerning Taxation (Act No.
26 of 1957)), NMF decided to distributealmost the entire amount of income as
stipulated in Article 136 Paragraph 1 ofthe Investment Trust Act, less thereversal of allowance for temporary
difference adjustments (as stipulated in
Article 2 Paragraph 2 (30) of theRegulations Concerning Accounting ofInvestment Corporations, the same
applies hereinafter), excluding the
portion for which per-unit distributions
would be less than ¥1. Accordingly,
NMF declared an earnings distribution
per investment unit of ¥2,073. This
amount excludes the distribution inexcess of earnings discussed below.
In accordance with the distribution
policy stipulated in the Articles ofIncorporation and in consideration of

NMF calculates distributions inaccordance with the cash distribution
policies as specified in Article 36,
paragraphs 1 and 2 of NMF’s Articles ofIncorporation.
For the fiscal period under review,
NMF
decidedtoimplement¥12,704,165,810 in distributions, for a
distribution per unit of ¥3,037. This
figure was calculated as ¥13,190,198,124
in net income plus ¥2,622,242,820 inamortizationofgoodwillminus¥3,107,662,242 in gains on sale of realestate, for a subtotal of ¥12,704,778,702,
from which the portion for which
per-unit distributions would be less than
¥1 was excluded.
Note that, for the fiscal period underreview, the distribution consists entirelyof the distribution of earnings, and there
is no distribution in excess of earnings as
defined in Article 36, Paragraph 2 of
NMF’s Articles of Incorporation.

I. Retained earnings at end of period- 19 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

the impact that such costs related to themerger of the three REITs that created
NMF and the absorption type merger
with
TOP
REIT
as
goodwill
amortization costs, net asset deductions(as described in Article 2 Paragraph 2(30) (b) of the Regulations Concerning
Accounting of Investment Corporations)and the reversal of allowance fortemporarydifference
adjustments(excluding
net
asset
deductions;
hereinafter referred to together withgoodwill amortization costs and othercosts related to the merger of the three
REITs and absorption type merger withTOP REIT as “merger-related costs”)
will have on distributions, NMF will
make a distribution in excess of earnings
in an amount that it determines
equivalent to the merger-related costs(hereinafter “distribution in excess ofearnings”). When implementing a
distribution in excess of earnings, if theperiod’s distribution of allowance fortemporary difference adjustments is lessthan the amount of merger-related costs,
other distributions in excess of net
earnings will also be implemented.
For the fiscal period under review,
NMF decided to implement ¥3,994
million in distributions in excess ofearnings. This figure is equivalent toalmost the entire sum (excluding the
portion for which per-unit distributions
would be less than ¥1) of ¥2,622 million
in goodwill amortization and ¥1,374
million in fees paid to the AssetManagement
Companyfortheabsorption type merger with TOP REIT.
Of this, ¥2,702 million will be
distributions of allowance for temporary
difference adjustments, for a per-unit
distribution of allowance for temporary
difference adjustments of ¥646. Other
distributions in excess of net earnings
will be ¥1,292 million; other distributions
in excess of net earnings per unit will be¥309.

- 20 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(5) Statement of Cash Flows
Thousands of Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017

Previous period
from Sep. 1, 2016
to Feb. 28, 2017
Cash flows from operating activities
Income before income taxes
Depreciation
Impairment loss
Amortization of goodwill
Amortization of investment corporation bond issuance
costs
Interest income
Interest expenses
Loss on disposal of property and equipment
Increase (decrease) in allowance for doubtful accounts
Decrease (increase) in rental receivables
Decrease (increase) in prepaid expenses
Decrease (increase) in consumption taxes receivable
Decrease (increase) in long-term prepaid expenses
Decrease (increase) in long-term deposits
Increase (decrease) in trade accounts payable
Increase (decrease) in other accounts payable
Increase (decrease) in accrued consumption taxes
Increase (decrease) in accrued expenses
Increase (decrease) in rent received in advance

8,672,559
4,757,915
269,797
2,622,242
1,372
（357)
2,165,353
5,259
(54)
176,867
87,776(147,670)(227,233)
3,407(466,025)(106,693)(698,979)(144,522)(599)

13,190,803
4,862,890－
2,622,242
1,372
(365)
2,157,516
4,997－(324,496)(56,437)
147,670(92,370)(32,777)
667,990(59,415)
1,227,566
9,343(141,431)

Decrease in property and equipment in trust due to sales－

43,502,593

184,451
17,154,866
357(2,383,092)
367
14,772,499

2,274
67,689,965
365(2,389,746)(1,605)65,298,979(11,255,557)(26,570,750)(2,430,622)(16,789,989)(7,949)(243,608)
436,532(565,829)
458,73850(13,608,247)(469)(221,253)
552,436(2,660,618)
1,013,247
11,000(44,666,399)

5,000,000－
42,950,000(44,055,300)(5,000,000)(10,219,932)

31,700,000(36,700,000)
45,070,000(45,112,800)(5,000,000)(8,699,523)(1,781)(2,701,640)(2,092,349)(1,291,979)

Other
SubtotalInterest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments for purchase of property and equipment
Payments for purchase of property and equipment in trust
Payments for purchase of intangible assets in trust
Reimbursement of security deposits to tenants
Proceeds from security deposits from tenants
Reimbursement of security deposits to tenants in trust
Proceeds from security deposits from tenants in trust
Proceeds from security deposits
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from short-term debt
Repayment of short-term debt
Proceeds from long-term debt
Repayment of long-term debt
Repayment of investment corporation bonds
Distributions of earnings to unitholders
Distributions in excess of net earnings from allowancefor temporary difference adjustments
Other distributions in excess of net earnings- 21 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents from merger
Cash and cash equivalents at end of period(13,419,364)(12,255,112)
75,270,568
10,315,582(*1)73,331,038- 22 -(22,735,943)(2,103,362)
73,331,038－(*1)71,227,675

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(6) Notes Concerning the Going Concern Assumption
Not applicable.

(7) Notes Concerning Significant Accounting Policies
1. Depreciation of
noncurrent assets① Property and equipment (including trust assets)
The straight-line method is adopted.
The useful lives of major property and equipment are as follows:
Buildings
3–70 years
Structures
2–45 years
Machinery
2–10 years
Tools, furniture and fixtures
2–20 years② Intangible assets
The straight-line method is adopted.
Goodwill is amortized using straight-line method over 20 years.
③ Long-term prepaid expenses
The straight-line method is adopted.

2. Deferred investment
corporation bond issuancecosts
3. Allowance for doubtful
accounts
4. Revenue and expenses
recognition

5. Hedge accounting

Deferred investment corporation bond issuance costs are amortized by the straight-line
method over the respective terms of the bonds.
To be ready for possible losses arising from defaults on receivables, the uncollectable amountis estimated and recorded by investigating collectability based on historical loan loss ratios forgeneral receivables and on case-by-case examinations for doubtful receivables.
Accounting for fixed asset tax, etc.
Of the tax amount assessed and determined for fixed asset tax, city planning tax,
depreciable asset tax, etc. on real estate, etc. held by NMF, the method of charging theamount corresponding to the concerned fiscal period to expenses as real estate rental
expenses is adopted.
The amount equivalent to fixed asset tax, etc. for the fiscal year in which the acquisition
date falls paid to the seller as reimbursement upon acquisition of real estate or trust
beneficiary interests in real estate is included in the cost of acquisition of the concerned
real estate and not recorded as expenses. The amount equivalent to fixed asset tax, etc.
included in the cost of acquisition of real estate, etc. was ¥3,333 thousand in the previous
fiscal period, and ¥135,274 thousand in the current fiscal period.
① Method of hedge accounting
Deferred hedge accounting is adopted. For interest-rate swap transactions that meetthe requirements for special treatment, special treatment is adopted.
② Hedging instruments and hedged items
Hedging instruments
Interest-rate swap transactions
Hedged items
Interest on loans③ Hedging policy
NMF conducts derivative transactions for the purpose of hedging risks prescribed in
the Articles of Incorporation in accordance with the Basic Policy on Risk Management.
④ Method for assessing effectiveness of hedging
The effectiveness of hedging is assessed by the correlation between changes in the fairvalue of hedging instruments and hedged items.

6. Other important bases for
preparing financial
statements① Method of accounting for trust beneficiary interests in real estate, etc.
Concerning trust beneficiary interests in real estate, etc., held by NMF, all assets andliabilities within the trust assets as well as all revenues and expenses generated by the trust
assets are recorded under the corresponding items of the Balance Sheet and Statement of
Income and Retained Earnings.
Of the trust assets thus recorded, the following major items are listed as separate itemson the balance sheet.
(1) Cash and bank deposits in trust(2) Buildings in trust; Structures in trust; Machinery in trust; Tools, furniture and fixturesin trust; Land in trust; Leased assets in trust- 23 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

7. Cash and cash equivalents
as stated in the Statementof Cash Flows(3) Leasehold rights in trust(4) Lease obligations in trust(5) Security deposits from tenants in trust② Method of accounting for consumption tax, etc.
Consumption tax and local consumption tax is accounted for using the tax-excluded
method.
However, non-deductable consumption tax, etc., on such items as noncurrent assets is
included in the acquisition costs of individual items.
Cash and cash equivalents in the statement of cash flows consist of cash on hand and cash intrust; deposits and deposits in trust that can be withdrawn at any time; and short-term
investments with a maturity of three months or less from the date of acquisition that arereadily convertible to cash and bear only an insignificant risk of price fluctuation.

(Additional Information)(Notes Concerning Increases in and the Reversal of Allowance for Temporary Difference Adjustments)

1.

Previous period
from Sep. 1, 2016
to Feb. 28, 2017
Reasons, related assets and amounts of allowance set
aside
Thousands of Yen

Related assets, etc.

ReasonGoodwill

Amortization of
goodwill
Merger expenses
Impairment loss
Shortfall ofreserve forrepairs

Land, buildings, etc.
Land, buildings, etc.
Long-term deposits
Increase—subtotal
Buildings,building
improvements, etc.
Unearned revenue, etc.

Other
Decrease—subtotal
Total
2.

Depreciation
deficiency
equivalent
Write-down ofloss on interest
rate swap due tomerger－Allowance
for
temporarydifference
adjustments
2,622,242
1,390,273
269,797
15,185
4,297,499(1,302,166)(216,261)(76,768)(1,595,197)
2,702,301

Reasons, related assets and amounts of reversals
Thousands of Yen
Allowance for
Related assets,
temporary
Reasonetc.
difference
adjustment
Land, buildings, Sale and depreciation －*etc.
of properties forwhichmergerexpenses
wererecordedDeferred gains Changes in fair value (708,820)
or losses on of derivatives
hedges(708,820)
Total

Current period
from Mar. 1, 2017
to Aug. 31, 2017
1．Reasons, related assets and amounts of reversals
Thousands of Yen
Allowance
forRelated assets,
Reasontemporaryetc.
difference
adjustment
Land, buildings, Sale and depreciation(91,221)etc.
of properties for whichmerger expenses wererecordedLand, buildings, Sale of property on(86,378)etc.
which impairment wasrecognizedDeferred gains Changes in fair value(20,951)
or losses on of derivatives
hedgesTotal(198,551)
2. Method of reversal
1. Amortization of goodwill
In principle, amortization of goodwill is not reversed.
2. Merger expenses
Method of reversal
Item
Buildings, etc. Upon depreciation and sale, thecorresponding amounts are scheduled tobe reversed.
Land
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
Buildings,
Upon depreciation and sale, theetc., in trust
corresponding amounts are scheduled tobe reversed.
Land in trust
LeaseholdrightsLeaseholdrights in trust3.

- 24 -

Upon sale, etc., the corresponding
amount is scheduled to be reversed.

Impairment loss
Upon the sale of the relevant properties, thecorresponding amount is scheduled to be reversed.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

*The amount cancelled in the period under review (¥6,319
thousand) is deducted from “Depreciation deficiency equivalent”
under 1., above.

4.

3. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Method of reversal
Item
Buildings, etc. Upon depreciation and sale, thecorresponding amounts are scheduled tobe reversed.
Land
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
Buildings,
Upon depreciation and sale, theetc., in trust
corresponding amounts are scheduled tobe reversed.
Land in trust
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
LeaseholdrightsLeaseholdrights in trust(3) Impairment loss
Upon the sale of the relevant properties, thecorresponding amount is scheduled to be reversed.
(4) Long-term deposits
In principle, long-term deposits are not reversed.
(5) Deferred gains or losses on hedges
The amount corresponding to changes in the fair valueof derivatives used as hedging instruments is scheduled
to be reversed.

- 25 -

Deferred gains or losses on hedges
The amount corresponding to changes in the fair valueof derivatives used as hedging instruments is scheduled
to be reversed.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(8) Notes to Financial Statements(Notes to Balance Sheet)*1. Commitment line agreement① NMF has concluded a commitment line agreement with two lending financial institutions as follows.

Committed line of credit
Balance of used line
Balance of unused line

Previous period(Feb. 28, 2017)
10,000,000
10,000,000

Thousands of Yen
Current period(Aug. 31, 2017)
10,000,000
10,000,000② NMF has concluded a commitment line agreement with five lending financial institutions as follows.

Committed line of credit
Balance of used line

Previous period(Feb. 28, 2017)
40,000,000
5,000,000

Balance of unused line

35,000,000

Thousands of Yen
Current period(Aug. 31, 2017)
40,000,000－
40,000,000*2. Minimum net assets as provided in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment
Corporations
Thousands of Yen
Previous period
Current period(Feb. 28, 2017)(Aug. 31, 2017)
50,00050,000*3. Asset offered as collateral and liabilities secured with collateralPrevious period(Feb. 28, 2017)

Thousands of Yen
Current period(Aug. 31, 2017)

Assets offered as collateral are as follows.
Buildings in trust¥3,335,340 thousand
Land in trust¥6,096,368 thousand
Total¥9,431,708 thousand

Assets offered as collateral are as follows.
Buildings in trust¥3,319,061 thousand
Land in trust¥6,096,368 thousand
Total¥9,415,429 thousand

Liabilities secured by collateral are as follows.
Security deposits fromtenants in trust¥726,648 thousand
Total¥726,648 thousand

Liabilities secured by collateral are as follows.
Security deposits fromtenants in trust¥726,648 thousand
Total¥726,648 thousand- 26 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

*4. Allowance for temporary difference adjustments
Previous period (from September 1, 2016 to February 28, 2017)
1. Reasons, related assets and amounts
Thousands of Yen
Related assets,
etc.
Goodwill

ReasonInitialamountBalance atthe end of
previous
periodAllowance
set aside
duringperiodAmortization of
goodwill

1,622,397

1,622,397－

Reversalduringperiod－Balance at theReason forend of current
reversal
period
1,622,397

Land, buildings,
etc.

Merger expenses

2,638,862

1,568,581－(71,187)

1,497,394

Land, buildings,
etc

Impairment loss

79,01979,019－(79,019)－

Deferred gains
or losses onhedgesLoss oninterest-rate
swaps
recognized at
the end of the
fiscal period－
Sale ofproperty
anddepreciationof merger
expenses
Sale ofproperty on
which
impairment
wasrecognized

2,867,594

2,867,594－(613,140)

2,254,454

Changes infair value ofderivativetransactions

7,207,875

6,137,594－(763,347)

5,374,246－(790,132)

－

－

－

－

－

(97,557)

－

－

－

－

－

(172,304)

－

－

－

－

－

(10,286)

－

－

－

－

－

Decrease –subtotal(1,070,280)

－

－

－

－

－

Total

6,137,594

6,137,594－(763,347)

5,374,246－

Increase –subtotal
Buildings,
building
improvements,
etc.

Investment
corporation bondissuance costs

Unearnedrevenue, etc.
Other

Depreciation
deficiency
equivalent
Investment
corporation
bonds issuancecost
amortization
deficiency
equivalent
Write-down ofloss on interest
rate swap
due to merger－- 27 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, Upon depreciation or sale, the corresponding amount is scheduled to be reversed.
etc.
Land in trust
Upon sale, the corresponding amount is scheduled to be reversed.
Leasehold rights
Leasehold rights intrust
Investment
Upon redemption, etc., the corresponding amount is scheduled to be reversed.
securities(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount isscheduled to be reversed.

- 28 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Current period (from March 1, 2017 to August 31, 2017)
1. Reasons, related assets and amounts
Thousands of Yen
ReasonInitialamountBalance atthe end of
previous
periodAllowance
set aside
duringperiodGoodwill

Amortization of
goodwill

4,244,640

1,622,397

2,622,242

Land, buildings,
etc.

Merger expenses

4,029,135

1,497,394(6,319)Deferred gains
or losses onhedgesLoss oninterest-rate
swaps
recognized at
the end of the
fiscal period

2,867,594

2,254,454－(708,820)

Land, buildings,
etc

Impairment loss

269,797－

86,378－86,378Long-term
deposits

Shortfall ofreserve forrepair15,185－－－－5,374,246

2,702,301(708,820)

7,367,727－

Related assets,
etc.

Increase –subtotal
Buildings,
building
improvements,
etc.

－

Balance atthe end ofcurrent
periodReason forreversal－

4,244,640－－

1,491,074－

ReversalduringperiodChanges infair value of
1,545,633
derivativetransactions－－

Depreciation
deficiency
equivalent(1,302,166)

－

－

－

－

－

Unearnedrevenue, etc.

Write-down ofloss on interest
rate swap
due to merger(216,261)

－

－

－

－

－

Other

－

(76,768)

－

－

－

－

－

Decrease –subtotal

－

－

－

－

－

－

Total

－

5,374,246

2,702,301(708,820)

7,367,727－- 29 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.

(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation and sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, Upon depreciation and sale, the corresponding amount is scheduled to be reversed.
etc.
Land in trust
Upon sale, the corresponding amount is scheduled to be reversed.
Leasehold rights
Leasehold rights intrust(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount isscheduled to be reversed.

- 30 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Notes to Statement of Income and Retained Earnings)*1. Breakdown of real estate rental revenues and expenses
Previous period
from Sep. 1, 2016
to Feb. 28, 2017
A. Property related revenues
Rental revenues
Rent revenues
Common area charges
Other rental revenues
Parking revenues
Incidental income
Other miscellaneous revenues
Property related revenues
B. Property related expenses
Real estate rental expenses
Property management costs
Property management fees
Property and other taxes
Utility expenses
Casualty insurance
Repairs and maintenanceLand rents
Depreciation
Other rental expenses
Property related expenses

29,030,375
2,700,036

Thousands of Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017

31,730,411

29,096,278
2,560,496

689,795

661,983

2,174,961
119,8112,984,567

2,507,619
205,62134,714,978

1,692,980
901,769
3,016,773
1,807,086
45,7502,135,499
208,052
4,757,368
1,226,241

C. Real estate rental profits [A－B]- 31 -

15,791,521
15,791,521
18,923,457

31,656,774

3,375,225
35,032,000

1,697,880
955,304
2,883,602
2,013,031
46,032
2,083,225
208,035
4,862,343
1,213,470

15,962,925
15,962,925
19,069,074

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

*2. Impairment loss
NMF recorded impairment loss during the previous period under review for the following asset groups.

Property name

Use

Tennozu Park Side Building

OfficeNOF Technoport
Center Building

OfficeKamataType

Impairment loss
(Thousands of
Yen)

Location

Land, building
trust, etc.
Land, building
trust, etc.

inin

Shinagawa-ku, Tokyo

220,723

Ota-ku, Tokyo

49,074

For the purpose of calculating impairment loss, each property is considered an asset group. NMF reached sales
agreements for NOF Technoport Kamata Center Building and Tennozu Park Side Building on December 22, 2016,
and April 4, 2017, respectively. As a result, the properties’ book values were decreased to their respective recoverable
values and the amount of decrease was recorded as impairment loss under operating expenses.
Any impairment loss caused by sales is regarded as having the properties of an operating expense and is therefore
recorded under operating expenses in accordance with Article 48 Paragraph 2 of the Regulations Concerning
Accounting of Investment Corporations.
Also, the recoverable values of the asset groups are measured using the respective net realizable values or values inuse. The net realizable values are calculated by subtracting the expected disposal costs from the actual sale prices. In
the calculation of values in use, the discount rate is not taken into account because the estimated periods of future
cash flows are brief.
*3. Breakdown of gain on sale of real estatePrevious period (from September 1, 2016 to February 28, 2017)
Not applicable.

Current period (from March 1, 2017 to August 31, 2017)
Thousands of Yen
NOF Nihonbashi Honcho Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
NOF Technoport Kamata Center Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
Tennozu Park Side Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
Mitsubishi Motors Shibuya
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
Mitsubishi Motors Suginami
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

11,730,000
10,889,175
60,292780,532
5,020,000
4,725,469
294,531－
12,700,000
12,467,899
232,101－
1,720,000
1,586,458
10,786
122,755
896,000
748,922
6,581
140,496- 32 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Ito-Yokado Higashi-Narashino Store
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
Merad Owada
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate
Ota
Nitta
Logistics
Center,Ota
Higashishinmachi Logistics Center, Ota
Kiyohara Logistics Center and Chiyodamachi
Logistics Center (＊)
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

664,000
641,752
6,771
15,476
7,380,000
6,510,260
84,372785,3677,304,250
5,932,656
108,560
1,263,033(＊)This assignment is an assignment to a single assignee under a single purchase agreement.

The purchase price of each property is not disclosed as the assignee’s consent to thedisclosure thereof has not been obtained.

(Notes to Statement of Changes in Net Assets)
Previous period
from Sep. 1, 2016
to Feb. 28, 2017

Current period
from Mar. 1, 2017
to Aug. 31, 2017

Total number of investment units authorized

20,000,000 units

20,000,000 units

Total number of investment units issued and outstanding

4,183,130 units

4,183,130 units*1.Total number of investment units authorized andtotal number of investment units issued and outstanding(Notes to Statement of Cash Flows)*1. Reconciliation of cash and cash equivalents at end of period to balance sheet items
Previous period
from Sep. 1, 2016
to Feb. 28, 201759,843,132

Cash and bank deposits

Thousands of Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017
58,143,774

Cash and bank deposits in trust

13,487,906

13,083,900

Cash and cash equivalents

73,331,038

71,227,675*2. Important non-cash transactions
Thousands of Yen
Previous period
Current period
from Sep. 1, 2016
from Mar. 1, 2017
to Feb. 28, 2017
to Aug. 31, 2017
Below is a breakdown of the main components of the assets and liabilities transferred from TOP REIT, Inc., as a result of
the merger with said company in the period under review. The increase in capital surplus due to the merger was ¥78,713,184
thousand.
Current assets

10,701,316－

Noncurrent assets

138,313,333－

Total assets

149,014,649－

Current liabilities

43,815,958－

Long-term liabilities

53,500,119－

Total liabilities

97,316,077－- 33 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Notes on Financial Instruments)
1. Matters concerning status of financial instruments(1) Policy for handling financial instruments
NMF procures funds through such means as debt financing, the issuance of investment corporation bonds and theissuance of investment units for the acquisition of real estate related assets. In procuring funds throughinterest-bearing liabilities, NMF adopts the basic financial policy of procuring funds with due consideration forextending the loan period, converting the interest rate to a fixed rate and laddering the repayment dates, etc. forinterest-bearing liabilities.
NMF enters into derivative transactions for the purpose of hedging risks of future interest rates rising and adopts
the policy of not engaging in speculative transactions.
(2) Description of financial instruments and associated risks, and risk management structure
Funds from debt and investment corporation bonds are primarily used to fund the acquisition of real estate-related
assets and to fund the repayment of debts and redemption of investment corporation bonds. These are exposed toliquidity risks of failure to procure alternative funds at the time of repayment or redemption. NMF controls and limits
these risks by diversifying the lending financial institutions it uses, while considering and implementing various
procurement of funds, including the effective use of surplus funds, procuring funds from the capital market throughissuance of investment units. In addition, floating interest rates debt is exposed to risks of the interest rate payablerising. NMF limits the impact that the interest rate payable rising has on NMF’s operations by keeping LTV (ratio ofinterest-bearing liabilities to total assets) at a low level and keeping the ratio of borrowings that are long-term andfixed-rate borrowings at a high level. Furthermore, derivative transactions (interest-rate swap transactions, etc.) areavailable as a hedging instrument for hedging risks of floating interest rates rising and effectively fixing interest rates.
Deposits are made for investing NMF’s surplus funds and are exposed to risks of failure of the financial institutions
that are holding the deposits and other credit risks, but NMF limits the risks by diversifying the financial institutions
that are holding the deposits.
(3) Supplementary explanation on matters concerning fair value, etc. of financial instruments
The fair value of financial instruments, aside from values based on market price, includes values based on reasonablecalculation when there is no market price. Certain assumptions are adopted in the calculation of the concerned values.
Accordingly, there may be cases where the concerned values will vary when different assumptions are adopted. In
addition, concerning the contract amount, etc. of derivative transactions presented in “Notes on Derivative
Transactions” later in this document, the amount itself does not represent the market risk involved in these derivativetransactions.
2. Matters concerning fair value, etc. of financial instruments
The following are the carrying amounts and fair values as of February 28, 2017, and the differences between theseamounts.
Thousands of Yen

Carrying amount(Note 1)
(1) Cash and bank deposits(2) Cash and bank deposits in trust(3) Short-term debt
(4) Current portion of investment
corporation bonds(5) Current portion of long-term debt
(6) Investment corporation bonds(7) Long-term debt
(8) Derivative transactions

Fair value(Note 1)

Amount of difference

59,843,132
13,487,906(5,000,000)

59,843,132
13,487,906(5,000,000)－－－(9,000,000)(9,042,508)

42,508(69,975,600)(18,500,000)(396,308,400)(1,563,490)(69,997,721)(19,979,231)(399,857,342)(1,563,490)

22,121
1,479,231
3,548,942－

The following are the carrying amounts and fair values as of August 31, 2017, and the differences between theseamounts.
Thousands of Yen

Carrying amount(Note 1)
(1) Cash and bank deposits(2) Cash and bank deposits in trust(3) Short-term debt
(4) Current portion of investment
corporation bonds(5) Current portion of long-term debt
(6) Investment corporation bonds(7) Long-term debt
(8) Derivative transactions

Fair value(Note 1)

Amount of difference

58,143,774
13,083,900

58,143,774
13,083,900

－

－

－
－
－

(4,000,000)(4,011,828)

11,828(54,760,600)(18,500,000)(411,480,600)(1,539,851)(54,912,627)(19,932,756)(417,122,162)(1,539,851)

152,027
1,432,756
5,641,562－(Note 1) Liabilities are shown in parentheses.
(Note 2) Matters concerning method for calculating fair value of financial instruments and derivative transactions.

- 34 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(1) Cash and bank deposits; (2) Cash and bank deposits in trust, (3) Short-term debt
As these are settled within a short period of time, the fair value is approximately the same as the book value and is thus stated at that bookvalue.
(4) Current portion of investment corporation bonds; (6) Investment corporation bonds
The fair value of investment corporation bonds issued by the Company is determined based on their market prices(5) Current portion of long-term debt; (7) Long-term debt
As long-term debt with floating interest rates reflect market interest rates within a short period of time, the fair value is thought to beapproximately the same as the book value and is thus stated at that book value (However, the fair value of long-term debt with floatinginterest rates that is subject to special treatment for interest-rate swaps (please refer to “Notes on Derivative Transactions” later in thisdocument) is based on the method of calculating by discounting the sum total amount of principal and interest accounted for as one
transaction together with the concerned interest-rate swap by the interest rate that is reasonably estimated as being applicable in the event ofdrawdown of a similar debt financing). In addition, the fair value of long-term debt with fixed interest rates is calculated based on the methodof calculating by discounting the sum total amount of principal and interest by the interest rate that is reasonably estimated as being
applicable in the event of drawdown of a similar debt financing.
(8) Derivative transactions
Please refer to “Notes on Derivative Transactions” later in this document.
(Note 3) Redemption of monetary claims scheduled to be due after the date of settlement of accounts (February 28, 2017)

Due within
1 yearCash and bank deposits
Cash and bank deposits in trust
Total

59,843,132
13,487,906
73,331,038

Due after
1 year,within2 years－－－

Due after
2 years,
within3 years－－－

Due after
3 years,
within4 years－－－

Thousands of Yen

Due after
4 years,
within5 years－－－

Due after
5 years－－－

Amount of redemption of monetary claims scheduled to be due after the date of settlement of accounts (August 31, 2017)
Thousands of Yen

Due within
1 yearCash and bank deposits
Cash and bank deposits in trust
Total

58,143,774
13,083,900
71,227,675

Due after
1 year,within2 years－－－

Due after
2 years,
within3 years－－－

Due after
3 years,
within4 years－－－

Due after
4 years,
within5 years－－－

Due after
5 years－－－(Note 4) Amount of repayment of investment corporation bonds, long-term debt and other interest-bearing liabilities scheduled to be due after thedate of settlement of accounts (February 28, 2017)
Thousands of Yen

Due within
1 yearShort-term debt
Investment corporation bonds
Long-term debt
Total

5,000,000
9,000,000
69,975,600
83,975,600

Due after
1 year,within2 years－－
51,940,000
51,940,000

Due after
2 years,
within3 years－－
60,685,600
60,685,600

Due after
3 years,
within4 years－
5,000,000
56,655,600
61,655,600

Due after
4 years,
within5 years－－
47,715,600
47,715,600

Due after
5 years－
13,500,000
179,311,000
192,811,000

Amount of repayment of investment corporation bonds, long-term debt and other interest-bearing liabilities scheduled to be due after thedate of settlement of accounts (August 31, 2017)
Thousands of Yen

Due within
1 yearShort-term debt
Investment corporation bonds
Long-term debt
Total－
4,000,000
54,760,600
58,760,600

Due after
1 year,within2 years－－
63,160,600
63,160,600(Notes on Securities)
Previous period (As of February 28, 2017)
Not applicable.
Current period (As of August 31, 2017)
Not applicable.

- 35 -

Due after
2 years,
within3 years－
5,000,000
58,385,600
63,385,600

Due after
3 years,
within4 years－－
52,235,600
52,235,600

Due after
4 years,
within5 years－－
44,715,600
44,715,600

Due after
5 years－
13,500,000
192,983,200
206,483,200

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Notes on Derivative Transactions)
1. Transactions not subject to hedge accounting
Previous period (As of February 28, 2017)
Not applicable.
Current period (As of August 31, 2017)
Not applicable.
2. Transactions subject to hedge accounting
Previous period (As of February 28, 2017)
The following is the contract amount or the amount equivalent to the principal provided in the contract, etc. as ofthe date of settlement of accounts for each method of hedge accounting.
Method ofhedge accounting
Principal treatment method
Special treatment forinterest-rate swaps

Type ofderivative transaction
Interest-rate swap transaction
Floating receivable
Fixed payable
Interest-rate swap transaction
Floating receivable
Fixed payable

Thousands of Yen
Fair value(Note 2)Main hedged
item

Contract amount (Note 1)
Due after 1 year

Long-term debt

175,500,000

134,780,000(Note 3) (1,563,490)

Long-term debt

101,739,500

101,696,700(Note 4) (1,399,669)

277,239,500

236,476,700(2,963,160)

Total(Note 1) Contract amount is based on notional amount.
(Note 2) Fair value is calculated by the swap counterparty, based on the actual market interest rate, etc.
(Note 3) Out of the fair value, (¥17,856 thousand) is booked as “accrued expenses” on the Balance Sheet.
(Note 4) Out of the fair value, (¥1,399,669 thousand) is not marked to market on the Balance Sheet, due to the adoption of special treatment forinterest-rate swaps.

Current period (As of August 31, 2017)
The following is the contract amount or the amount equivalent to the principal provided in the contract, etc. as ofthe date of settlement of accounts for each method of hedge accounting.
Method ofhedge accounting
Principal treatment method
Special treatment forinterest-rate swaps

Type ofderivative transaction
Interest-rate swap transaction
Floating receivable
Fixed payable
Interest-rate swap transaction
Floating receivable
Fixed payable

Thousands of Yen
Fair value(Note 2)Main hedged
item

Contract amount (Note 1)
Due after 1 year

Long-term debt

154,100,000

129,380,000(Note 3) (1,539,851)

Long-term debt

101,718,100

89,475,300(Note 4) (1,402,532)

255,818,100

218,855,300(2,942,383)

Total(Note 1) Contract amount is based on notional amount.
(Note 2) Fair value is calculated by the swap counterparty, based on the actual market interest rate, etc.
(Note 3) Out of the fair value, (¥15,169 thousand) is booked as “accrued expenses” on the Balance Sheet.
(Note 4) Out of the fair value, (¥1,402,532 thousand) is not marked to market on the Balance Sheet, due to the adoption of special treatment forinterest-rate swaps.

(Notes on retirement benefit plans)Previous period (As of February 28, 2017)
Not applicable, as NMF has no retirement benefit system.
Current period (As of August 31, 2017)
Not applicable, as NMF has no retirement benefit system.
(Notes on Business Combination)
Previous period (As of February 28, 2017)
Business Combination through Acquisition
1． Overview of the Business Combination（1） Name and Line of Business of Aquiree
Name of acquiree
TOP REIT, Inc. (hereinafter “TOP”)

Line of business
Real estate investment trust（2） Main Reasons for the Business Combination
NMF believes that the absorption type merger with TOP presented a rare opportunity for external growth in theheated real estate acquisition market. Furthermore, the absorption type merger with TOP increased NMF’s ratio
of investment in properties for which future internal growth can be expected, specifically properties that are in
upside sectors or located within Tokyo's five central wards. TOP expected that, because the absorption-type- 36 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

merger would make Nomura Real Estate Group, a general real estate developer, its sponsor, said merger would
promote external growth by reinforcing the property pipeline. Furthermore, TOP expected that the absorption
type merger would significantly diversify its portfolio and thereby improve its income stability. Thus having
reached the shared understanding that the absorption type merger would best increase their respective unitholder
value, NMF and TOP entered into an absorption type merger agreement.
（3） Date of the Business Combination
September 1, 2016（4） Legal Framework of the Business Combination
An absorption type merger with NMF as the surviving corporation and TOP as the absorbed corporation.
（5） Name of the Investment Corporation after the Merger
Nomura Real Estate Master Fund, Inc.
（6） Main Reasons for the Selection of the Acquiring Company
NMF was selected as the acquiring company in accordance with the Accounting Standards for Business
Combinations and other relevant standards based on a comprehensive consideration of such factors as corporate
scale, including each company’s total assets and net income; the ratio of voting rights that would be controlled byeach company’s unitholders after the absorption-type merger; and the composition of the Board of Directors
after the absorption type merger.
2． Period of Performance of Acquiree Included in the Statement of Income and Retained Earnings
Name of acquiree
Period of performance
TOP
September 1, 2016 to February 28, 2017
3． Acquisition Cost of Acquiree and its Breakdown
Thousands of Yen
Name of acquireeTOP

Acquisition cost
78,713,184

4． Exchange Ratio, Method of Calculation and Number of Investment Units Delivered as Consideration for theAcquisition（1） Exchange Ratio of Investment Units
NMF
TOP
Merger ratio
1.00
2.62
（2） Method of Calculation
Each investment corporation appointed a financial advisor (hereafter “FA”) for the absorption type merger andrequested that said financial advisor perform a financial analysis of the merger ratio. NMF appointed Nomura
Securities Co., Ltd., and TOP appointed Daiwa Securities Co., Ltd. Based on comprehensive consideration ofsuch factors as each corporation’s financial performance, assets and liabilities, and future outlook, as well as the
merits of the absorption type merger for each corporation and the results of the financial analyses conducted by
the two FAs, NMF and TOP reached an agreement with regard to the above merger ratio through careful
negotiation and formed the absorption type merger agreement.
（3） Number of Investment Units Granted
Name of acquiree
TOP

Investment units granted asconsideration
461,120

5． Content and Amount of Main Acquisition-Related Expenses
Thousands of Yen
Content
Amount240,000
FA fees
1,374,890
Acquisition fees for merger
6． Amount and Cause of Goodwill
Amount of Goodwill¥27,014,612 thousand- 37 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

（1）

Cause of Goodwill
Goodwill was caused by the acquisition of the acquiree, TOP, for ¥78,713,184 thousand (the acquisition price),
which exceeded the market value of its net assets, ¥51,698,571 thousand.

（2）

Method of Goodwill Amortization and the Amortization Period
The goodwill will be amortized by the straight-line method over a period of 20 years.

7． Amounts and Main Content of Assets Accepted and Liabilities Taken from the Business Combination
Thousands of Yen
Previous assets
10,701,316
Noncurrent assets
138,313,333
Total assets
149,014,649
Previous liabilities
Long-term liabilities
Total liabilities

43,815,958
53,500,119
97,316,077

8． Estimated Impact on the Statement of Income and Retained Earnings for the Fiscal Period under Review Assuming
the Business Combination Was Completed on the Start Date of the Operating Period
There is no impact since the business combination date is the same as the start date of the operating period.
Current period (As of August 31, 2017)
Not applicable.

(Notes on Tax Effect Accounting)
1. Breakdown of main causes for occurrence of deferred tax assets and deferred tax liabilities
Previous period(February 28, 2017)
Deferred tax assets

Current period(August 31, 2017)(Thousands of Yen)

Accepted valuation difference at merger

24,633,094

21,965,966

Denied impairment loss

85,628－Deferred gains or losses on hedges

488,323

481,703

Interest received in advance339,960

275,397

Over-depreciated long-term prepaid expenses

28,77925,634

Denied amortization of leasehold right in trust

733

855

Non-deductible accrued enterprise tax

39－

Subtotal deferred tax assets

25,576,558

22,749,557

Valuation allowance(25,576,558)(22,749,557)

Total deferred tax assets－－

Net deferred tax assets－－- 38 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

2. Breakdown of major components that caused significant differences between statutory tax rate and effective tax
rate after application of tax effect accounting
Previous period(February 28, 2017)
Statutory tax rate

Current period(August 31, 2017)31.74%

31.74%

Deductible cash distributions
Valuation allowance(41.62%)(16.57%)0.30%(21.48%)

Amortization of goodwill

9.60%

6.31%

Other

0.01%

0.00%

Effective tax rate after application of tax effectaccounting

0.02%

0.00%

(Adjustments)(Notes on equity method income and retained earnings, etc.)

Previous period (from September 1, 2016 to February 28, 2017)
Not applicable, as NMF has no subsidiaries or affiliates.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable, as NMF has no subsidiaries or affiliates.

(Notes on Transactions with Related Parties)
1. Parent company and major corporate unitholders
Previous period (from September 1, 2016 to February 28, 2017)
Not applicable.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable.
2. Subsidiaries and affiliates
Previous period (from September 1, 2016 to February 28, 2017)
Not applicable.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable.
3. Fellow subsidiaries
Previous period (from September 1, 2016 to February 28, 2017)
Not applicable.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable.
4. Directors and major individual unitholders
Previous period (from September 1, 2016 to February 28, 2017)
Not applicable.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable.

- 39 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Notes on asset retirement obligations)
Previous period (from September 1, 2016 to February 28, 2017)
Not applicable.
Current period (from March 1, 2017 to August 31, 2017)
Not applicable.

(Notes on Investment and Rental Properties)

NMF owns leasable offices, leasable retail facilities, leasable logistics facilities and leasable residential ,etc(includingland) in Greater Tokyo area and other areas for the purpose of earning revenue from leasing.
The following are the carrying amount, amount of increase (decrease) during the fiscal period and fair value of theseinvestment and rental properties at the end of the fiscal period.
Previous period
from Sep. 1, 2016
to Feb. 28, 2017
Carrying amount
Balance at beginning of period
Amount of increase (decrease) during period
Balance at end of period
Fair value at end of period(Note 1)
(Note 2)

(Note 3)

782,457,778
146,378,940
928,836,719
996,084,000

Thousands of Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017
928,836,719(5,680,915)
923,155,804
1,002,630,000

Carrying amount is the cost of acquisition less accumulated depreciation.
Of the change in investment and rental properties, the increase during the previous period is mainly attributable to theacquisition of 19 properties as a result of the absorption type merger with TOP REIT, Inc. (total of ¥137,495,038
thousand) and the acquisition of Landport Kashiwa Shonan II (¥10,916,634 thousand). The decrease during the previous
period is mainly attributable to depreciation (¥4,754,117 thousand).The increase during the current period is mainly
attributable to the acquisition of nORBESA (¥8,638,004 thousand),NRE Kichijoji Building (¥5,141,844 thousand), Nakaza
Cui-daire Building (¥12,165,807 thousand),Landport Kashiwa Shonan Ⅰ (¥10,040,496 thousand),PRIME URBAN
Gakugei Daigaku Parkfront (¥1,402,842 thousand), Proud Flat Omori Ⅲ(¥1,165,489 thousand), Proud Flat Kinshicho(¥831,191 thousand), Summit Store Narita-Higashi(Land) (¥744,810 thousand). The decrease during the current period ismainly attributable to the sale of NOF Technoport Kamata Center Building (¥4,725,469 thousand),NOF Nihonbashi
Honcho Building (¥10,889,175 thousand), Tennozu Park Side Building (¥12,467,899 thousand), Mitsubishi Motors Shibuya(¥1,586,458 thousand), Mitsubishi Motors Suginami(¥748,922), Ito-Yokado Higashi-Narashino Store (¥641,752 thousand),
Merad Owada (¥6,510,260 thousand), Ota Nitta Logistics Center (¥3,081,630 thousand), Ota Higashishinnmachi Logistics
Center (¥1,958,017 thousand), Ota Kiyohara Logistics Center(¥578,054 thousand) and Chiyodamachi Logistics Center(¥314,953 thousand) as well as depreciation (¥4,858,613 thousand).
Fair value at the end of the period is the appraisal value or investigation value determined by investigation, found by anoutside real estate appraiser. However, the scheduled transfer price is used as the fair value for NOF Technoport Kamata
Center Building, NOF Nihonbashi Honcho Building, Tennozu Park Side Building, Mitsubishi Motors Shibuya, Mitsubishi
Motors Suginami and Ito-Yokado Higashi-Narashino Store in the previous period and for Morisia Tsudanuma in thecurrent period.

The income (loss) in the previous period (from September 1, 2016 to February 28, 2017) and current period (from March
1, 2017 to August 31, 2017) for investment and rental properties is as presented in “Notes to Statement of Income andRetained Earnings” earlier in this report.
(Notes on Segment Information)(Segment Information)
Since NMF has only one segment, the real estate leasing business, segment information has been omitted.
(Related Information)
Previous period (from September 1, 2016 to February 28, 2017)
1. Information by product and service
Disclosure is omitted, since revenues from external customers of a single product/service category account for morethan 90% of the operating revenues presented on the Statement of Income and Retained Earnings.

- 40 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

2. Information by geographical area
(1) Revenues
Disclosure is omitted, since revenues from external customers in Japan account for more than 90% of the operating
revenues presented on the Statement of Income and Retained Earnings.
(2) Property and equipment
Disclosure is omitted, since the amount of property and equipment located in Japan accounts for more than 90% of
the amount of property and equipment presented on the Balance Sheet.
3. Information by major customer

Customer name
Nomura Real Estate Partners
Co., Ltd.

Revenues (Thousands of Yen)

Related segment name4,499,817

Rental real estate businessCurrent period (from March 1, 2017 to August 31, 2017)
1. Information by product and service
Disclosure is omitted, since revenues from external customers of a single product/service category account for morethan 90% of the operating revenues presented on the Statement of Income and Retained Earnings.
2. Information by geographical area
(1) Revenues
Disclosure is omitted, since revenues from external customers in Japan account for more than 90% of the operating
revenues presented on the Statement of Income and Retained Earnings.
(2) Property and equipment
Disclosure is omitted, since the amount of property and equipment located in Japan accounts for more than 90% of
the amount of property and equipment presented on the Balance Sheet.
3. Information by major customer

Customer name
Nomura Real Estate Partners
Co., Ltd.

Revenues (Thousands of Yen)

Related segment name4,708,156

Rental real estate business- 41 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

(Notes on Per Unit Information)
Previous period
from Sep. 1, 2016
to Feb. 28, 2017

Yen
Current period
from Mar. 1, 2017
to Aug. 31, 2017

Net assets per unit

132,939

133,069

Net income per unit

2,072

3,153

(Note 1)
(Note 2)

Net income per unit is calculated by dividing net income by the average number of investment units during the period.
In addition, the diluted net income per unit is not stated, since there are no dilutive investment units.
The following is the basis for calculation of net income per unit.

Previous period
from Sep. 1, 2016
to Feb. 28, 2017

Current period
from Mar. 1, 2017
to Aug. 31, 2017

8,670,955

13,190,198－－

Net income attributable to ordinary investment units (Thousands ofYen)

8,670,955

13,190,198

Average number of investment units during period (Units)

4,183,130

4,183,130

Net income (Thousands of Yen)
Amount not attributable to ordinary unitholders (Thousands of
Yen)(Notes on Significant Subsequent Events)
1.Asset Sales
NMF reached an agreement to sell and sold the following asset after the conclusion of the 4th fiscal
period (August 31, 2017).
① Morisia Tsudanuma
 Type of asset
Trust beneficiary interest in mainly real estate Use
Retail facility
 Contract date
September 29, 2017
 Transfer date
September 29, 2017
 Transfer price¥18,000 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 5th fiscal period earnings¥3 million(Scheduled)
The impact of ①, above, on earnings for the 5th fiscal period (September 1, 2017 to February 28, 2018)
will be recorded as gain on sales of real estate under operating revenues.
[Disclosure Omissions]
A disclosure of notes concerning lease transactions is omitted because such disclosure in this summary offinancial results is judged to be unnecessary.

- 42 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(9) Increase (Decrease) in Total Number of Investment Units Issued and Outstanding
The following is the increase (decrease) in unitholders’ capital and total number of investment units issued andoutstanding during the period from the date of incorporation of NMF through the end of the current fiscal
period (August 31, 2017).

Date

Description

Total number ofinvestment units
issued and outstanding(Units)Increase
Balance(Decrease)

Unitholders’ capital(Millions of Yen) (Note 1)
Increase(Decrease)

Note

Balance

October 1, 2015

Consolidation typemerger3,722,010

3,722,010

161,120

161,120(Note 2)September 1, 2016

Absorption typemerger461,120

4,183,130－

161,120(Note 3)－4,183,130

763

161,883(Note 4)－4,183,130

708

162,592(Note 4)

October 14, 2016

April 14, 2017
(Note 1)
(Note 2)
(Note 3)(Note 4)

Reversal of Allowancefor temporary
difference adjustments
Reversal of Allowancefor temporary
difference adjustments

Figures have been truncated at the nearest million yen.
NMF was established through the consolidation type merger of the former NMF, NOF and NRF on October 1, 2015. Upon its
establishment, NMF allotted 1 NMF unit per former 1.00 NMF unit, 3.60 NMF units per 1.00 NOF unit and 4.45 NMF units per 1.00
NRF unit.
On September 1, 2016, as part of the absorption type merger, NMF issued 2.62 NMF units per 1.00 TOP unit, resulting in the issueof 461,120 new units. There is no change of unitholders’ capital.
At its October 14, 2016 and April 14, 2017 meetings, NMF’s Board of Directors resolved to reverse the allowance for temporary
difference adjustments and incorporate the amounts of said reversals into unitholders’ capital.

- 43 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

4. Changes in Directors(1) Changes in NMF Directors
Based on a resolution reached at NMF’s first Unitholders’ Meeting, held May 26, 2017, Shuhei Yoshida took
office as executive director, and Mineo Uchiyama and Koichi Owada took office as supervisory directors
effective June 1, 2017. NMF’s directors as of the date of this document’s publication are as listed below. Notethat executive director Satoshi Yanagita and supervisory directors Sadahiko Yoshimura and Shuhei Yoshida
resigned as of May 31, 2017. Accordingly, their concurrent positions are omitted.
Executive director

Main concurrent positions

Incoming director

Shuhei Yoshida(As of June 1, 2017)

Partner, Law Office Shuhei Yoshida

Outgoing director

Satoshi Yanagita(As of May 31, 2017)—

Supervisory directors

Main concurrent positions

Mineo Uchiyama(As of June 1, 2017)

Partner, Mineo Uchiyama CPA Office

Koichi Owada(As of June 1, 2017)

CEO, Tama Sōgō Appraisal Corporation

Incoming directors

Outgoing directors

Sadahiko Yoshimura(As of May 31, 2017)—

Shuhei Yoshida(As of May 31, 2017)—(2) Changes in Asset Management Company Directors and Statutory Auditors
Timely disclosure of changes in directors and statutory auditors is made when the relevant details are
determined.
During the 4th fiscal period, there were changes in directors and statutory auditors as shown below. For
details, please refer to the press release dated March 3, 2017 titled “Notice Concerning Scheduled
Amendments of the Articles of Incorporation, Changes in Organization, and Changes of Directors,
Statutory Auditors and Important Employees in the Asset Management Company” and the press release
dated May 18, 2017 titled “Notice Concerning Changes of Directors in the Asset Management Company.”
Appointments (as of April 1, 2017)
Name
Title (New)
Representative Director andSenior Managing Executive Officer
Supervisor of the Investment
Management Department
Fumiki Kondo
In charge of the Corporate Planning
Department, the International
Business Planning Section and the
Finance & Accounting Department
Director andManaging Executive Officer
In charge of the Client Relations &Noriaki Ido
Marketing Department, the Investment
Management Department and theProduct Development Department

Seiichiro Wada

Statutory Auditor- 44 -

Title (Former)(New appointment)

Executive Officer,
General Manager of the Acquisitions
Department
Director and Managing Executive
Officer
In charge of the Client Relations &Marketing Department, the Investment
Management Department and theProduct Management Department

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Resignations (as of March 31, 2017)
Name

Hiroshi Kurokawa

Title (New)(Resignation)

Title (Former)
Representative Director and Senior
Managing Executive Officer
Supervisor of the ProductManagement Department, theAcquisitions Department, theInvestment Management Planning
Department, the NMF Investment
Management Group and the NPR
Investment Management Department
In charge of the Research & Analysis
SectionChief Strategy Officer

Resignations (as of June 15, 2017)
Name

Title (New)

Title (Former)

Yoshiyuki Ito(Resignation)

Statutory Auditors

Other changes (as of April 1, 2017)
Name
Title (New)
Representative Director andSenior Managing Executive Officer
Supervisor of the ProductDevelopment Department, the NMF
Investment Management Group andthe NPR Investment Management
Masato Yamauchi
Department
In charge of the Research & Analysis
Department, the Acquisitions
Department and the Investment
Management Planning Department
Chief Strategy Officer

Kenichi Okada

Director and Managing Executive
Officer
Head of the NMF Investment
Management Group- 45 -

Title (Former)

Director andManaging Executive Officer
In charge of the Finance & Accounting
Department
General Manager of the Corporate
Planning Department

Director and Managing Executive
Officer
Head of the NMF Investment
Management Group
General Manager of the AssetManagement Department I of the
NMF Investment Management GroupNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

5. Reference Information(1) Investment Status
3rd fiscal period
4th fiscal period
As of February 28, 2017
As of August 31, 2017
Area
As a percentage
As a percentage
Type of asset
Use
Total amount held
Total amount held
(Note 1)of total amount ofof total amount of(Millions of Yen)
(Millions of Yen)
assets (%)
assets (%)(Note 2)
(Note 2)
(Note 3)(Note 3)
Greater Tokyo area
93,482
8.5
93,197
8.5
OfficeOther areas
21,7202.0
21,630
2.0
properties
Subtotal
115,203
10.4
114,827
10.5
Greater Tokyo area
16,172
1.5
16,854
1.5
RetailOther areas
12,157
1.1－－
properties
Subtotal
16,172
1.5
29,012
2.6
Real estate
Greater Tokyo area
10,8631.0
20,810
1.9
Logistics
properties
Subtotal
10,8631.0
20,8101.9
Greater Tokyo area
124,205
11.2
126,920
11.6
Residential
Other areas
31,7082.9
31,3672.9
properties
Subtotal
155,91314.1
158,287
14.4
Greater Tokyo area
5,136
0.5
5,136
0.5
Other
properties
Subtotal
5,136
0.5
5,136
0.5
Greater Tokyo area
285,379
25.8
257,332
23.5
OfficeOther areas
50,512
4.6
50,5694.6
properties
Subtotal
335,892
30.4
307,901
28.1
Greater Tokyo area
91,247
8.3
93,692
8.5
RetailOther areas
45,4344.1
47,263
4.3
properties
Real estate
Subtotal
136,68112.4
140,955
12.9
in trust
Greater Tokyo area
121,141
11.0
120,488
11.0
Logistics
Other areas
9,463
0.9
3,453
0.3
properties
Subtotal
130,605
11.8
123,942
11.3
22,3682.0
22,281
2.0
Residential Greater Tokyo area
properties
Subtotal
22,3682.0
22,281
2.0
Subtotal
928,83684.0
923,155
84.2
Deposits and other assets
177,14216.0
172,67215.8
1,105,979
100.0
1,095,828
100.0
Total amount of assets
3rd fiscal period
As of February 28, 2017
As a percentage
Amountof total amount(Millions of Yen)of assets (%)(Note 4)(Note 3)
Total amount of liabilities
Total amount of net assets

4th fiscal period
As of August 31, 2017
As a percentage
Amountof total amount(Millions of Yen)of assets (%)(Note 4)(Note 3)549,874

49.7

539,17949.2

556,104

50.3

556,649

50.8(Note 1) “Greater Tokyo area” refers to Tokyo, Kanagawa Prefecture, Chiba Prefecture and Saitama Prefecture. “Other areas” refers tocabinet-order-designated cities, prefectural capitals, and cities with a population of 100,000 persons or more as well as surrounding areas ofthese cities that are not included in the Greater Tokyo area.
(Note 2) Total amount held is the carrying amount (in the case of real estate and real estate in trust, the sum total amount of book value, after
depreciation).
(Note 3) The figures are rounded off to first decimal place. Accordingly, the sum may not be exactly 100.0%.
(Note 4) Total amount of liabilities and total amount of net assets are the amounts as stated in the balance sheet as total liabilities and total net assets.

- 46 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017(2) Investment Assets① Major Investment Securities
Not applicable.
② Investment Real Estate Properties
Real estate is listed together with beneficial interests in real estate trusts in ③ Other Major Investment
Assets, below.
③ Other Major Investment Assets
The following summarizes the real estate, etc. (268 properties) held as of August 31, 2017 (end of the 4th
fiscal period) by NMF (this real estate and the beneficiary interests of trusts in which real estate properties
are the principal trust properties or the real estate that constitutes the underlying assets thereof arehereinafter referred to as the “assets held at the end of the 4th fiscal period”). Unless otherwise stated, thefigures in the tables below are the figures as of August 31, 2017.

- 47 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

A. Overview of Portfolio and Leasing Status and Changes in Occupancy Rate(a) Overview of Portfolio and Leasing Status
The following is an overview of the portfolio and leasing status for the assets held at the end of the
4th fiscal period.
Number of properties

268

Gross leasable area (m2) (Note 1)

1,847,370.18

Gross leased area (m2) (Note 2)

1,818,028.01

Total number of tenants (Note 3)

1,340

Total of all contracted rent (Thousands of Yen) (Note 4)

5,155,353(Note 1) The sum total of the “leasable area” of each of the assets held at the end of the 4th fiscal period. “Leasable area” is the sum
total area of office facilities, retail facilities, logistics facilities, or residential facilities, etc. leasable in each asset (including the areaof common-use space, etc., if leased). Leasable area is calculated based not on that presented in the registry, but the area statedin the lease contract and the area calculated based on building completion drawings, etc. Accordingly, the leasable area may not
be the same as the floor area based on that presented in the registry and may exceed the floor area. In the case of land withleasehold right, the land area based on that presented in the registry is used as contracted area. For the Shinjuku Nomura
Building, NEC Head Office Building and Musashiurawa Shopping Square the leasable area is the area calculated by multiplying
the building’s overall leasable area by the quasi co-ownership ratio of the beneficial interest in real estate trust owned by NMF
as of the end of the fiscal period. For the NRE Tennozu Building, since the rent under the master lease agreement is calculated
as the building’s overall rent multiplied by the ownership ratio of the common areas, the leasable area is calculated as thebuilding’s overall leasable area multiplied by the ownership ratio of the common areas. Land with leasehold interest indicates theland area in the registry as contracted space.
(Note 2) The sum total of “leased area” of each of the assets held at the end of the 3rd fiscal period. “Leased area” is the area that is
actually leased to an end-tenant (The area stated in the lease contract; provided, however, that such be limited to the area ofoffice properties, retail properties, logistics properties, or residential properties, etc. (if all rental units are collectively leased,
then the area of the entire rental units) and not include the leased area of parking space, etc. However, if the master lessee has arent-guaranteed master lease for some or all rental units, the space is included in leased area regardless of whether or not there
is a lease agreement with an end-tenant.) in each asset. In the case of land with leasehold right, the leased area of the land isshown. For the Shinjuku Nomura Building, NEC Head Office Building and Musashiurawa Shopping Square the leased area isthe area calculated by multiplying the building’s overall leased area by the quasi co-ownership ratio of the beneficial interest inreal estate trust owned by NMF as of the end of the fiscal period. For the NRE Tennozu Building, since the rent under the
master lease agreement is calculated as the building’s overall rent multiplied by the ownership ratio of the common areas, theleased area is calculated as the building’s overall leased area multiplied by the ownership ratio of the common areas.
(Note 3) The sum total of “total number of tenants” of each of the assets held at the end of the 4th fiscal period. In the calculation of“number of tenants,” when some or all rental units are collectively leased for the purpose of subleasing and the lessee in thelease agreement (master lease agreement) has concluded an agreement with an end-tenant (sublessee that is the actual user) for
subleasing the rental units, the lessee of the master lease agreement is counted as one tenant. However, in the case of assets
with a so-called pass-through master lease agreement, where the rent received from the lessee in the master lease agreement is
the same amount as the rent that the lessee receives from the end-tenant, the total number of end-tenants is shown. In addition,
if multiple rental units in a specific asset are leased to a specific tenant, this is counted as one tenant for the asset and, if
multiple assets are leased to a specific tenant, these are counted separately and the total of that number of tenants is shown. For
residential facilities or residential portions of “other” sector facilities, when some or all rental units are collectively leased for the
purpose of subleasing and the lessee in the lease agreement (master lease agreement) has concluded an agreement with an
end-tenant for subleasing the rental units, the lessee of the master lease agreement is counted as one tenant, and the total
number of tenants for the building as whole is shown.
(Note 4) The total amount of “total contracted rent” for August 2017 of each of the assets held at the end of the 4th fiscal period(amounts less than one thousand are truncated). “Total contracted rent” for August 2017 refers to the sum total of monthly
rent and common area charges in lease agreements actually concluded with end-tenants that are valid as of the last day ofAugust 2017 (This does not include parking space or other fees stated in parking space lease agreements or other suchagreements signed in addition to the tenant lease agreement. If common-use space, etc. is leased based on the lease agreement,
the rent for such is included and, if rent includes an amount equivalent to the fee for use of parking space, such amount isincluded. In addition, if the master lessee has a rent-guaranteed master lease for some or all rental units, the rent for the space isbased on the rent, etc., in the lease agreement concluded with the master lessee.). Furthermore, regarding tenants who havebeen exempt from rent payment for a certain period of time in their agreements, such exemption period is not considered in
the table above, and the rent is calculated based on the monthly rent and common area charges payable immediately after the
exemption period ends. In addition, the standard level of rent is used for tenants with sales-based rent. For the Shinjuku- 48 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Nomura Building, NEC Head Office Building and Musashiurawa Shopping Square the total contracted rent is calculated bymultiplying the building’s overall rent revenues by the quasi co-ownership ratio of the beneficial interest in real estate trust
owned by NMF as of the end of the fiscal period. For the NRE Tennozu Building, the the total contracted rent is calcuclated as thebuilding’s overall rent revenues multiplied by the ratio of the common areas that NMF owns through the trustee.

(b) Changes in Occupancy Rate
The following is the changes in the occupancy rate of real estate under management held by NMF.

Portfolio occupancy rate
(at end of fiscal period) (%)

February 29, 2016(end of 1st fiscal
period)August 31, 2016(end of 2nd fiscal
period)February 28, 2017(end of 3rd fiscal
period)August 31, 2017(end of 4th fiscal
period)

98.9

99.1

99.2

98.4

- 49 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

B. Price and Investment Share
The following is an overview of the assets held at the end of the 4th fiscal period (acquisition price,
carrying amount, opinion of value at end of period, investment share and appraiser).
Use

OfficeArea

GreaterTokyo
area

Acquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

Shinjuku Nomura Building (Note 5)

43,90045,813

49,100

4.9

NRE Tennozu Building

20,50020,466

21,700

2.2

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

Kojimachi Millennium Garden

26,70026,58627,200

2.7

Japan Real Estate Institute

NMF Shinjuku Minamiguchi Building

10,000

10,151

10,600

1.1

Japan Real Estate Institute

NMF Shibuya Koen-dori Building

10,40010,444

10,600

1.1

Daiwa Real
Estate Appraisal Co., Ltd.

Secom Medical Building

11,10010,963

11,400

1.1

Japan Real Estate Institute

NMF Shiba Building

7,040

7,051

7,250

0.7

Nishi-Shinjuku Showa Building

8,140

8,151

8,100

0.8

NRE Shibuya Dogenzaka Building

5,310

5,317

5,630

0.6

Daiwa Real
Estate Appraisal Co., Ltd.
Appraisal Firm A SquareLtd.
Daiwa Real
Estate Appraisal Co., Ltd.

Iwamoto-cho Toyo Building

4,050

4,055

4,180

0.4

Japan Real Estate Institute

NMF Surugadai Building

4,690

4,702

4,890

0.5

The Tanizawa
Sogo Appraisal Co., Ltd.

PMO Nihonbashi Honcho

4,320

4,225

4,560

0.5

Japan Real Estate Institute

PMO Nihonbashi Kayabacho

5,010

4,922

5,470

0.5

Japan Real Estate Institute

NMF Gotanda Ekimae Building

4,430

4,601

4,830

0.5

Daiwa Real
Estate Appraisal Co., Ltd.

NRE Higashi-nihonbashi Building

3,570

3,546

3,510

0.4

Japan Real Estate Institute

PMO Akihabara

4,240

4,152

4,830

0.5

Japan Real Estate InstituteHatchobori NF Building

2,480

2,464

2,590

0.3

The Tanizawa
Sogo Appraisal Co., Ltd.

NMF Kanda Iwamoto-cho Building

4,160

4,198

4,120

0.4

Japan Real Estate Institute

NMF Takanawa Building

2,830

2,819

2,900

0.3

Japan Real Estate Institute

PMO Hatchobori

2,880

2,815

3,220

0.3

Japan Real Estate Institute

PMO Nihonbashi Odenmacho

2,210

2,162

2,570

0.3

Japan Real Estate Institute

PMO Higashi-nihonbashi

1,690

1,645

1,880

0.2

Japan Real Estate Institute

NRE Ueno Building

6,470

6,502

6,640

0.7

Japan Real Estate Institute

NF Hongo Building.

4,890

4,865

5,150

0.5

Crystal Park Building

3,390

3,360

3,420

0.3

Daiwa Real
Estate Appraisal Co., Ltd.
Appraisal Firm A SquareLtd.

NMF Kichijoji Honcho Building

1,780

1,838

1,920

0.2

Japan Real Estate InstituteFaret Tachikawa Center Square

3,850

3,841

4,190

0.4

The Tanizawa
Sogo Appraisal Co., Ltd.

NMF Kawasaki Higashiguchi Building

7,830

7,898

8,860

0.9

Japan Valuers Co., Ltd.

NMF Yokohama Nishiguchi Building

5,460

5,677

6,440

0.6

Japan Real Estate Institute

NMF Shin-Yokohama Building

2,620

2,806

2,970

0.3

The Tanizawa
Sogo Appraisal Co., Ltd.

PMO Tamachi

6,210

6,253

6,750

0.7

Japan Real Estate Institute

PMO Ginza Hatchome

3,970

3,996

4,410

0.4

Japan Real Estate Institute

PMO Shibakoen

3,900

3,925

4,320

0.4

Japan Real Estate Institute

NEC Head Office Building (Note 6)

44,10044,18444,500

4.4

Harumi Island Triton Square Office Tower
Y

18,20018,11818,600

1.9

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

NMF Aoyama 1-chome Building

10,40010,41911,700

1.2

Japan Real Estate Institute

NMF Takebashi Building

8,330

8,320

8,540

0.9

Harumi Island Triton Square Office Tower
Z

8,180

8,129

8,180

0.8

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

NMF Kayabacho Building

6,070

6,039

6,200

0.6

Japan Real Estate Institute

Property name- 50 -

AppraiserNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Area

GreaterTokyo
area

Office

Other
areas

RetailGreaterTokyo
area

Acquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

NMF Shinjuku EAST Building

5,710

5,744

5,790

0.6

The Tanizawa
Sogo Appraisal Co., Ltd.

NMF Shiba-Koen Building

3,620

3,637

3,750

0.4

Japan Real Estate Institute

NMF Ginza 4-chome Building

1,850

1,860

1,930

0.2

Faret East Building

1,850

1,847

1,940

0.2

The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.

Sapporo North Plaza

6,250

6,325

7,080

0.7

Japan Real Estate Institute

NRE Sapporo Building

4,140

3,975

4,470

0.4

Japan Real Estate Institute

NMF Sendai Aoba-dori Building

2,030

2,160

2,160

0.2

NOF Utsunomiya Building

2,320

2,600

2,330

0.2

Morii
Appraisal&
Investment onsulting, Inc.
The Tanizawa
Sogo Appraisal Co., Ltd.

NMF Nagoya Fushimi Building

2,240

2,156

2,240

0.2

Japan Real Estate Institute

NMF Nagoya Yanagibashi Building

2,280

2,312

2,140

0.2

Japan Valuers Co., Ltd.

Omron Kyoto Center Building

18,30018,19818,700

1.9

Japan Real Estate Institute

SORA Shin-Osaka 21

12,10012,023

12,100

1.2

Japan Valuers Co., Ltd.

NRE Osaka Building

6,100

6,326

6,200

0.6

NRE Nishi-Umeda Building

3,450

3,475

3,630

0.4

NRE Yotsubashi Building

4,000

4,010

4,140

0.4

NRE Hiroshima Building

2,280

2,273

2,580

0.3

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.

NMF Hakata Ekimae Building

4,210

4,191

4,630

0.5

Japan Real Estate Institute

NMF Tenjin-Minami Building

2,230

2,169

2,330

0.2

Japan Real Estate Institute

Office subtotal

420,260

422,728442,060

44.1

Morisia Tsudanuma

16,60017,91917,500

1.7

Yokosuka More’s City

13,64013,80516,300

1.6

Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.

Recipe SHIMOKITA

10,407

10,588

10,900

1.1

Japan Valuers Co., Ltd.

Kawasaki More’s

6,080

6,669

7,810

0.8

EQUINIA Shinjuku

4,260

4,305

4,920

0.5

EQUINA Ikebukuro

3,990

4,067

4,490

0.4

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

covirna machida

3,440

3,748

4,320

0.4

Japan Real Estate InstituteNitori Makuhari

3,080

2,874

3,740

0.4

Japan Real Estate InstituteKonami Sports Club Fuchu

2,730

2,600

3,400

0.3

Daiwa Real
Estate Appraisal Co., Ltd.

FESTA SQUARE

2,600

2,408

3,200

0.3

Japan Real Estate Institute

GEMS Shibuya

2,490

2,446

2,660

0.3

Daiwa Real
Estate Appraisal Co., Ltd.

Sundai Azamino

1,700

1,585

2,060

0.2

Japan Real Estate Institute

EQUINIA Aobadai

1,560

1,631

1,900

0.2

Japan Real Estate Institute

Megalos Kanagawa

1,000

983

1,380

0.1

Japan Real Estate InstituteMitsubishi Motors Meguro

2,740

2,764

3,150

0.3

Japan Real Estate InstituteMitsubishi Motors Chofu

1,760

1,776

1,780

0.2

Daiwa Real
Estate Appraisal Co., Ltd.

Mitsubishi Motors Nerima

1,240

1,251

1,400

0.1

Japan Real Estate InstituteMitsubishi Motors Kawasaki

950

959

1,160

0.1

Mitsubishi Motors Takaido

850

859

886

0.1

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

Mitsubishi Motors Katsushika

800

808

884

0.1

Japan Real Estate InstituteMitsubishi Motors Higashikurume

800

808

882

0.1

Japan Real Estate InstituteMitsubishi Motors Setagaya

770

779

896

0.1

Japan Real Estate InstituteMitsubishi Motors Sekimachi

600

606

680

0.1

Japan Real Estate Institute

Property name- 51 -

AppraiserNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

Mitsubishi Motors Higashiyamato

450

455

511

0.1

The Tanizawa
Sogo Appraisal Co., Ltd.

Mitsubishi Motors Motosumiyoshi

370

375

385

0.0

Japan Real Estate InstituteMitsubishi Motors Kawagoe

350

355

376

0.0

Mitsubishi Motors Edogawa

200

204

185

0.0

Mitsubishi Motors Sayama

160

163

173

0.0

NRE Kichijoji Building

10,41010,409

11,100

1.1

GEMS Ichigaya

2,080

2,092

2,080

0.2

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

Sagamihara Shopping Center

6,840

6,814

6,910

0.7

Japan Real Estate InstituteMusashiurawa Shopping Square (Note 6)

2,720

2,682

2,770

0.3

The Tanizawa
Sogo Appraisal Co., Ltd.

700

744

756

0.1

Japan Real Estate Institute

Universal CityWalk Osaka

15,50015,567

18,200

1.8

Japan Valuers Co., Ltd.

Izumiya Senrioka

8,930

8,606

11,200

1.1

Izumiya Yao

4,460

4,157

5,410

0.5

Izumiya Obayashi

3,020

3,211

3,890

0.4

Ichibancho stear

4,700

4,575

5,640

0.6

EQUINIA Aobadori

1,640

1,469

2,020

0.2

The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.

MEL Building

1,060

1,055

1,170

0.1

Japan Real Estate InstitutenORBESA

8,500

8,618

8,540

0.9

Japan Real Estate InstituteNakaza Cui-daore Building

11,60012,157

11,300

1.1

Japan Valuers Co., Ltd.

Retail subtotal

167,723

169,968

188,91418.9

Landport Urayasu

17,40016,60921,5002.1

Landport Itabashi

15,71015,086

19,200

1.9

The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.

Landport Kawagoe

13,70012,711

16,500

1.6

Japan Real Estate InstituteLandport Atsugi

11,41010,815

11,900

1.2

Sagamihara Tana Logistics Center

10,600

10,296

12,400

1.2

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

Sagamihara Onodai Logistics Center

8,700

8,186

11,100

1.1

Japan Real Estate InstituteLandport Hachioji

8,250

7,725

9,650

1.0

Japan Real Estate InstituteLandport Kasukabe

7,340

6,744

8,710

0.9

Japan Real Estate InstituteFunabashi Logistics Center

4,660

4,563

5,440

0.5

Japan Real Estate InstituteAtsugi Minami Logistics Center B Tower

4,590

4,375

5,590

0.6

Hanyu Logistics Center

3,810

3,596

4,380

0.4

Kawaguchi Logistics Center B Tower

3,750

3,678

4,630

0.5

Kawaguchi Logistics Center A Tower

2,830

2,804

3,510

0.4

Atsugi Minami Logistics Center A Tower

2,690

2,606

3,390

0.3

Kawaguchi Ryoke Logistics Center

10,79010,686

12,7001.3

Landport Kashiwa Shonan II

10,80010,817

11,400

1.1

Japan Valuers Co., Ltd.

Landport Kashiwa Shonan I

9,900

9,993

10,200

1.0

Japan Valuers Co., Ltd.

Hirakata Kuzuha Logistics Center

3,460

3,453

3,850

0.4

Daiwa Real
Estate Appraisal Co., Ltd.

150,390

144,752

176,050

17.6

Area

GreaterTokyo
area

RetailProperty name(Note 7)

Summit Store Naritahigashi (Land)

Other
areas

Logistics

Acquisition price(Millions of Yen)
(Note 1)

Greater
Tokyo
area

Other
areas

Logistics subtotal- 52 -

Appraiser

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
Morii
Appraisal&
Investment
Consulting,Inc.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Area

Acquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

3,400

3,333

3,440

0.3

PROUD FLAT Yoyogi Uehara

989

985

1,060

0.1

PROUD FLAT Hatsudai

713

700

760

0.1

PROUD FLAT Shibuya Sakuragaoka

750

734

689

0.1

PROUD FLAT Gakugei Daigaku

746

728

788

0.1

PROUD FLAT Meguro Gyoninzaka

939

920

1,010

0.1

PROUD FLAT Sumida Riverside

2,280

2,212

2,460

0.2

PROUD FLAT Kagurazaka

1,590

1,550

1,730

0.2

PROUD FLAT Waseda

1,110

1,080

1,190

0.1

947

923

929

0.1

PROUD FLAT Sangen Jaya

1,190

1,156

1,260

0.1

PROUD FLAT Kamata

1,160

1,121

1,230

0.1

PROUD FLAT Kamata II

3,320

3,219

3,260

0.3

PROUD FLAT Shinotsuka

623

602

547

0.1

PROUD FLAT Kiyosumi Shirakawa

928

898

983

0.1

PROUD FLAT Monzen Nakacho II

652

633

602

0.1

PROUD FLAT Monzen Nakacho I

1,030

996

948

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co.
Daiwa Real
Estate Appraisal Co.
Daiwa Real
Estate Appraisal Co.

PROUD FLAT Fujimidai

1,470

1,431

1,630

0.2

Japan Real Estate Institute

PROUD FLAT Asakusa Komagata

1,920

1,852

2,080

0.2

PROUD FLAT Yokohama

2,090

2,021

2,170

0.2

PROUD FLAT Kamioooka

2,710

2,621

2,670

0.3

The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PROUD FLAT Tsurumi II

1,650

1,595

1,760

0.2

Japan Real Estate Institute

PRIME URBAN Azabu Juban

1,100

1,101

1,140

0.1

PRIME URBAN Akasaka

938

934

903

0.1

PRIME URBAN Tamachi

972

959

1,020

0.1

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

1,830

1,783

1,910

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Yoyogi

359

351

366

0.0

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Ebisu II

1,140

1,130

1,260

0.1

Japan Real Estate Institute

PRIME URBAN Bancho

1,090

1,077

1,080

0.1

679

669

629

0.1

PRIME URBAN Iidabashi

2,040

2,003

2,000

0.2

PRIME URBAN Ebisu

1,260

1,249

1,280

0.1

PRIME URBAN Naka Meguro

1,410

1,392

1,440

0.1

PRIME URBAN Gakugei Daigaku

775

767

820

0.1

PRIME URBAN Senzoku

474

469

485

0.0

PRIME URBAN Meguro Riverside

414

402

441

0.0

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Meguro Ohashi Hills

2,970

2,910

3,040

0.3

Japan Valuers Co., Ltd.

PRIME URBAN Meguro Aobadai

1,310

1,291

1,430

0.1

Japan Real Estate Institute

PRIME URBAN Gakugei Daigaku II

1,080

1,066

1,170

0.1

Japan Real Estate Institute

PRIME URBAN Naka Meguro II

2,850

2,838

3,030

0.3

Japan Real Estate Institute

Property name

PROUD FLAT Shirokane Takanawa

PROUD FLAT Shinjuku Kawadacho

Greater
Residential Tokyo
area

PRIME URBAN Shibaura LOFTPRIME URBAN Chiyoda Fujimi- 53 -

AppraiserNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Residentia

Area

GreaterTokyo
area

Property nameAcquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

Appraiser

PRIME URBAN Kachidoki

2,570

2,573

2,640

0.3

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Shinkawa

2,100

2,084

2,260

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Nihonbashi
Yokoyamacho

4,220

4,108

4,400

0.4

Japan Valuers Co., Ltd.

PRIME URBAN Nihonbashi Hamacho

1,550

1,520

1,710

0.2

Japan Real Estate Institute

PRIME URBAN Hongo Ikizaka

557

545

594

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Hakusan

866

840

933

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Yotsuya Gaien Higashi

1,490

1,477

1,580

0.2

PRIME URBAN Nishi Shinjuku I

1,090

1,079

1,150

0.1

PRIME URBAN Nishi Shinjuku II

885

874

954

0.1

PRIME URBAN Shinjuku Naitomachi

430

431

458

0.0

PRIME URBAN Nishi Waseda

421

408

448

0.0

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Shinjuku Ochiai

594

596

633

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Mejiro

1,430

1,414

1,540

0.2

Japan Real Estate Institute

PRIME URBAN Kagurazaka

2,900

2,834

3,020

0.3

Japan Real Estate Institute

PRIME URBAN Sangen Jaya III

718

715

629

0.1

PRIME URBAN Chitose Karasuyama

717

722

754

0.1

PRIME URBAN Sangen Jaya

724

709

771

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Minami Karasuyama

667

649

747

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Karasuyama Galleria

549

534

573

0.1

PRIME URBAN Karasuyama Court

338

329

357

0.0

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Chitose Funabashi

746

727

710

0.1

Japan Valuers Co., Ltd.

1,390

1,360

1,490

0.1

Japan Real Estate Institute

494

492

520

0.1

PRIME URBAN Osaki

1,860

1,832

1,990

0.2

PRIME URBAN Oimachi II

1,040

1,042

1,100

0.1

PRIME URBAN Yukigaya

951

946

726

0.1

PRIME URBAN Omori

905

879

951

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Denenchofu Minami

774

751

708

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Nagahara Kamiikedai

1,720

1,693

1,780

0.2

Japan Real Estate Institute

PRIME URBAN Nakano Kamitakada

498

483

538

0.1

Japan Valuers Co., Ltd.

1,060

1,051

1,120

0.1

PRIME URBAN Nishi Ogikubo

414

405

422

0.0

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Nishi Ogikubo II

1,790

1,769

1,870

0.2

Japan Real Estate Institute

PRIME URBAN Otsuka

730

717

766

0.1

PRIME URBAN Komagome

437

434

452

0.0

Daiwa Real
Estate Appraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Ikebukuro

3,800

3,713

4,000

0.4

Japan Real Estate Institute

PRIME URBAN Monzen Nakacho

2,420

2,366

2,530

0.3

PRIME URBAN Kameido

779

753

803

0.1

PRIME URBAN Sumiyoshi

632

613

647

0.1

PRIME URBAN Mukojima

528

519

540

0.1

PRIME URBAN Kinshi Koen

1,290

1,245

1,200

0.1

PRIME URBAN Yoga
PRIME URBAN Shinagawa Nishi

PRIME URBAN Takaido- 54 -

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Area

Property nameAcquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)PRIME URBAN Kinshicho

758

740

708

0.1

PRIME URBAN Hirai

722

697

753

0.1

PRIME URBAN Kasai

640

620

648

0.1

PRIME URBAN Kasai II

981

952

997

0.1

PRIME URBAN Kasai East

1,140

1,104

1,200

0.1

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Itabashi Kuyakushomae

1,080

1,046

1,150

0.1

Japan Valuers Co., Ltd.

384

384

296

0.0

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Machiya South Court

1,910

1,881

1,990

0.2

Japan Real Estate Institute

PRIME URBAN Musashi Koganei

1,910

1,907

1,970

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Musashino Hills

1,280

1,279

1,320

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Koganei Honcho

791

774

838

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Kumegawa

1,520

1,459

1,420

0.1

Japan Real Estate Institute

PRIME URBAN Musashi Kosugi comodo

1,940

1,927

2,140

0.2

Japan Valuers Co., Ltd.

962

950

1,040

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Shinyurigaoka

1,020

989

1,180

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tsurumi Teraya

493

486

394

0.0

Japan Real Estate Institute

PRIME URBAN Urayasu

804

783

858

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku I

633

616

560

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku II

730

710

665

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku Ekimae

488

477

509

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku Ekimae II

469

459

483

0.0

Japan Real Estate Institute

PRIME URBAN Gyotoku III

747

733

776

0.1

Japan Real Estate Institute

PRIME URBAN Nishi Funabashi

761

735

807

0.1

Japan Real Estate Institute

PRIME URBAN Kawaguchi

1,580

1,541

1,710

0.2

Japan Valuers Co., Ltd.

PROUD FLAT Hatchobori

920

946

999

0.1

Japan Real Estate Institute

PROUD FLAT Itabashi Honcho

720

745

782

0.1

Japan Real Estate Institute

PRIME URBAN Meguro Mita

1,058

1,130

1,110

0.1

Japan Valuers Co., Ltd.

Fukasawa House Towers H&I

7,140

7,085

7,310

0.7

PRIME URBAN Toyosu

5,290

5,236

5,390

0.5

PRIME URBAN Nihonbashi Kayabacho

2,850

2,832

2,900

0.3

PRIME URBAN Yoga II

1,320

1,311

1,330

0.1

PRIME URBAN Musashi Koganei II

1,310

1,292

1,360

0.1

PRIME URBAN Gakugei daigaku
parkfront

1,300

1,397

1,310

0.1

PROUD FLAT Omori Ⅲ

1,110

1,159

1,170

0.1

PROUD FLAT Kinshicho

785

825

858

0.1

PROUD FLAT Itsutsubashi

652

621

710

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
The Tanizawa
Sogo Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Morii Appraisal &Investment Consulting,Inc.
Morii Appraisal &Investment Consulting,Inc.
Daiwa Real
Estate Appraisal Co., Ltd.

PROUD FLAT Kawaramachi

735

697

686

0.1

Japan Real Estate Institute

PROUD FLAT Shin Osaka

1,620

1,545

1,700

0.2

Japan Real Estate Institute

PRIME URBAN Kita Juyo Jo

274

264

280

0.0

The Tanizawa
Sogo Appraisal Co., Ltd.

PRIME URBAN Odori Koen I

502

482

530

0.1

Japan Real Estate Institute

PRIME URBAN Odori Koen II

334

322

350

0.0

Japan Real Estate Institute

PRIME URBAN Asakusa

PRIME URBAN Kawasaki

GreaterTokyo
area

Residentia

Other
areas

- 55 -

AppraiserNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Use

Residential

Other(Note 1)

Property nameAcquisition price(Millions of Yen)
(Note 1)

Carrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)PRIME URBAN Kita Juichi Jo

547

522

588

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Miyanosawa

475

450

498

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Odori Higashi

394

377

418

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Chiji Kokan

249

236

272

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Maruyama

229

218

237

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Kita Nijuyo Jo

437

416

465

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Sapporo Idaimae

616

588

643

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Sapporo Riverfront

4,480

4,290

4,580

0.5

Japan Valuers Co., Ltd.

PRIME URBAN Kita Sanjo Dori

1,730

1,649

1,830

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Nagamachi Icchome

1,140

1,095

1,060

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Yaotome Chuo

466

447

436

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Tsutsumidori Amamiya

949

949

926

0.1

Japan Real Estate Institute

PRIME URBAN Aoi

712

695

737

0.1

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Kanayama

553

529

595

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tsurumai

1,020

972

1,110

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Kamimaezu

1,590

1,527

1,640

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Izumi

3,770

3,631

4,060

0.4

Japan Valuers Co., Ltd.

PRIME URBAN Esaka I

652

633

674

0.1

PRIME URBAN Esaka II

794

769

847

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Esaka III

1,190

1,137

1,170

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tamatsukuri

1,020

984

1,060

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Sakaisuji Honmachi

1,810

1,741

1,830

0.2

Japan Real Estate Institute

PRIME URBAN Hakata

588

566

614

0.1

PRIME URBAN Yakuin Minami

265

254

281

0.0

PRIME URBAN Kashii

398

378

338

0.0

PRIME URBAN Hakata Higashi

622

593

529

0.1

PRIME URBAN Chihaya

604

582

567

0.1

Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.
Daiwa Real
Estate Appraisal Co., Ltd.

PRIME URBAN Chikusa

1,110

1,190

1,130

0.1

Japan Valuers Co., Ltd.

Residential subtotal

184,045

180,569

189,976

19.0

4,900

5,136

5,130

0.5

Other subtotal

4,900

5,136

5,130

0.5

Total

927,318

923,155

1,002,130

100.0

Area

Other
areas

GreaterTokyo
area

Ryotokuji University
Campus (Land)

Shin-Urayasu

Appraiser

Japan Real Estate Institute“Acquisition Price” refers to the following. Of the assets succeeded as a result of the merger of three REITs, the appraisal value as of September 30,
2015 for NRE Shibuya Dogenzaka Building and as of April 30, 2015 for other assets succeeded from NOF; and the appraisal value as of September 30,
2015 for PRIME URBAN Shinyurigaoka and as of May 31, 2015 for other assets succeeded from NRF are recorded as said assets’ respective acquisition
prices. Furthermore, the appraisal value as of March 31, 2016 or April 1, 2016 for other assets succeeded from TOP are recorded as said assets’respective acquisition prices. For all other assets, “Acquisition price” indicates the amount, excluding the various expenses required to acquire the property,
including transaction brokerage fees, taxes and public dues, etc. (the amount of transaction payment for real estate, etc., described in the sales agreement).

(Note 2)“Carrying amount” is the sum total amount of the acquisition price (including various expenses required for the acquisition) of land, buildings, structures,
tools, furniture and fixtures, construction in progress, and leasehold rights (including these assets in trust), less accumulated depreciation.

(Note 3)

“Opinion of value at end of period” is the appraisal or investigation value provided by the respective real estate appraiser (the value calculated by therespective real estate appraiser with the date of the 4th fiscal period-end (August 31, 2017) as the effective date of value and the value indicated by the
income approach as a standard) in accordance with NMF’s Articles of Incorporation and the Regulations Concerning Accounting of Investment
Corporations.
The appraisal or investigation value of real estate is no more than an indication of the opinion of the value of the appraised real estate at the time ofappraisal by the respective real estate appraiser, etc., conducted in accordance with the Act on Real Estate Appraisal (Act No. 152 of 1963, including- 56 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

subsequent amendments), and real estate appraisal standards, etc. Reappraisal of the same real estate may result in a different appraisal or investigation
value, depending on the real estate appraiser conducting the appraisal and the method or timing of the appraisal. In addition, the appraisal of real estate is
not a guarantee or promise of the possibility of transactions at present or in the future at the appraised value.
Furthermore, the cost approach and income approach (direct capitalization approach and discounted cash flow approach) are used in appraisal
calculations. The appraisal value is determined by the income approach if the subject real estate’s price is estimated with an emphasis on investment
profitability in the market and it is seen as an investment target for qualified institutional investors, etc. The value indicated by the cost approach is used as
an index to verify the value indicated by the income approach.
The “direct capitalization approach” is a method where the net revenue in a certain period is capitalized by the capitalization rate. It is a method ofseeking the value indicated by the income approach (a method of seeking the estimated value of real estate by seeking the sum of the present value ofthe net revenue the real estate is expected to generate in the future).
The “discounted cash flow (DCF) approach” is a method where the net income and terminal value arising in multiple successive periods are
discounted to present value according to their periods and totaled. It is also a method of seeking the value indicated by the income approach.
(Note 4)

“Investment share” is the period-end opinion of value of the respective asset as a percentage of the total amount of the period-end opinion of value ofthe entire portfolio (268 properties in total). The figures are rounded to the first decimal place. Accordingly, the sum total may be exactly 100.0.

(Note 5)

NMF holds quasi co-ownership of 50.1% of beneficial interest in real estate. For the for opinion of value and carrying price in the table above, price of
this quasi co-ownership interest ratio s stated for opinion of value and carrying price.

(Note 6)

NMF holds quasi co-ownership of 50.0% of beneficial interest in real estate. For the for opinion of value and carrying price in the table above, price of
this quasi co-ownership interest ratio s stated for opinion of value and carrying price.

(Note 7)

NMF’s acquisition of quasi co-ownership of the beneficial interest in the property was made in two stages. The acquisition price given is the total forboth transactions.

(Note 8)Property names were changed on April 1, 2017 for the following properties.
Old name

New name(Before change)(After change)

Akasaka Oji Building

NMF Aoyama 1-chome Building

Kanda Nishiki-cho 3-chome Building

NMF Takebashi Building

Shinkawa Chuo Building

NMF Kayabacho Building

Shinjuku EAST Building

NMF Shinjuku EAST Building

Shiba-Koen Building

NMF Shiba-Koen Building

Ginza Oji Building

NMF Ginza 4-chome Building- 57 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

C. Status of Major Tenants
Details concerning the leasing status of major tenants are shown below. Major tenants are those who, as ofAugust 31, 2017, account for 10% or more of the total leased area of the assets held by NMF as of August
31, 2017 (in cases where multiple assets have the same tenant, this is calculated using the total leased area for
all assets leased by said tenant).
Tenant Busine
namess type

Property namedate

Contract Extension

Leased area

Annual rent(m2)(Millions of Yen)

(Note 1)

(Note 2)

Leasehold andsecurity deposits(Millions of Yen)
(Note 3)

Shinjuku Nomura Building

March 31, 2018

1,021.25

19

187

NRE Yotsubashi Building

March 31, 2018

1,024.91

40

27

March 31, 2018

4,706.14

225

33

PROUD FLAT Shirokane Takanawa

February 28, 2018

2,836.98

179

37

PROUD FLAT Yoyogi Uehara

February 28, 2018

1,151.34

59

6

PROUD FLAT Hatsudai

Kojimachi Millennium Garden(Residential building)

February 28, 2018958.9847

4

PROUD FLAT Shibuya Sakuragaoka February 28, 2018638.7041

5PROUD FLAT Gakugei Daigaku

February 28, 2018867.7545

5PROUD FLAT Meguro Gyoninzaka

February 28, 2018791.72

49

5

PROUD FLAT Sumida Riverside

February 28, 2018

3,055.21

147

14

PROUD FLAT Kagurazaka

February 28, 2018

1,753.50

91

2

PROUD FLAT Waseda

February 28, 2018

1,387.83

66

6

PROUD FLAT Shinjuku Kawadacho February 28, 2018

1,102.20

56

8

PROUD FLAT Sangen Jaya

February 28, 2018

1,251.59

67

6

PROUD FLAT Kamata

February 28, 2018

1,519.89

72

7

PROUD FLAT Kamata II

February 28, 2018

3,974.13

200

23

PROUD FLAT Shinotsuka

February 28, 2018

710.0337

31,209.56

599

785.8338

4

PROUD FLAT Yokohama

shall
be
February 28, 2018 Contract
extendedfor additional terms
February 28, 2018 of one year unless either
party notifies the other party
February 28, 2018 in writing of its intention to
February 28, 2018 terminate this contract nolater than three months
February 28, 2018 prior to the expiration of
the initial term or any
February 28, 2018 extended term thereof.

PROUD FLAT Kamioooka

February 28, 2018

4,872.17

182

16

PROUD FLAT Tsurumi II

February 28, 2018

2,198.64

111

21

PRIME URBAN Azabu Juban

February 28, 2018

1,101.82

60

5PRIME URBAN Akasaka

February 28, 2018

1,026.86

54

5

PRIME URBAN Tamachi

February 28, 2018

1,107.36

61

6

PRIME URBAN Shibaura LOFT

February 28, 2018

1,853.91

110

9PRIME URBAN Yoyogi

February 28, 2018414.0222

2PRIME URBAN Ebisu II

February 28, 2018

1,184.77

69

6

PRIME URBAN Bancho

February 28, 2018

1,183.03

61

6

PRIME URBAN Chiyoda Fujimi

February 28, 2018766.7740

4PRIME URBAN Iidabashi

February 28, 2018

2,087.70

120

16

PRIME URBAN Ebisu

February 28, 2018

1,393.32

65

6

PRIME URBAN Naka Meguro

February 28, 2018

1,302.42

79

9

PRIME URBAN Gakugei Daigaku

February 28, 2018975.2447

4PRIME URBAN Senzoku

February 28, 2018655.2730

3PRIME URBAN Meguro Riverside

February 28, 2018453.7728

2February 28, 2018

2,850.99

160

15

February 28, 2018

1,418.71

73

12

PROUD FLAT Kiyosumi Shirakawa
NomuraReal
EstateReal
Partners estateCo., Ltd.
（Note 4)Contract termination

PROUD FLAT Monzen Nakacho II
PROUD FLAT Monzen Nakacho I
PROUD FLAT Fujimidai
PROUD FLAT Asakusa Komagata

PRIME URBAN Meguro Ohashi
Hills
PRIME URBAN Meguro Aobadai- 58 -

1,191.0864

72,114.80

105

14

2,659.83

122

17

3,021.27

136

16

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Tenant Busine
namess type

Property namedate

Contract Extension

Leased area

Annual rent(m2)(Millions of Yen)

(Note 1)

(Note 2)

Leasehold andsecurity deposits(Millions of Yen)
(Note 3)PRIME URBAN Gakugei Daigaku II February 28, 2018

1,082.00

59

10

PRIME URBAN Naka Meguro II

February 28, 2018

2,358.51

152

36

PRIME URBAN Kachidoki

February 28, 2018

4,504.28

182

19

February 28, 2018

5,834.24

246

40

February 28, 2018

1,960.0891

9

PRIME URBAN Hongo Ikizaka

February 28, 2018662.5833

3PRIME URBAN Hakusan

February 28, 2018

1,069.82

52

4

February 28, 2018

1,687.65

86

8

PRIME URBAN Nishi Shinjuku I

February 28, 2018

1,342.77

67

6

PRIME URBAN Nishi Shinjuku II

February 28, 2018

1,162.55

56

5

February 28, 2018578.1827

2PRIME URBAN Nishi Waseda

February 28, 2018507.1128

2PRIME URBAN Shinjuku Ochiai

February 28, 2018

1,053.39

41

3

PRIME URBAN Mejiro

February 28, 2018

1,678.03

83

5

PRIME URBAN Kagurazaka

February 28, 2018

2,812.29

161

22

PRIME URBAN Sangen Jaya III

February 28, 2018893.4242

31,649.6847

9823.2643

51,024.6245

3784.0036

2PRIME URBAN Karasuyama Court

February 28, 2018 Contract
shallbeextendedfor additional terms
February 28, 2018 of one year unless either
party notifies the other party
in writing of its intention to
February 28, 2018
terminate this contract nolater than three months
prior to the expiration of
February 28, 2018 the initial term or any
extended term thereof.
February 28, 2018576.2024

1

PRIME URBAN Chitose Funabashi

February 28, 2018

1,027.44

46

5

PRIME URBAN Yoga

February 28, 2018

1,564.77

73

9

PRIME URBAN Shinagawa Nishi

February 28, 2018941.5442

7PRIME URBAN Osaki

February 28, 2018

2,084.99

111

11

PRIME URBAN Oimachi II

February 28, 2018

1,762.83

90

8

PRIME URBAN Yukigaya

February 28, 2018

1,520.28

70

7PRIME URBAN Omori

February 28, 2018

1,190.70

58

6

February 28, 2018

1,071.32

48

4

February 28, 2018

2,135.27

91

10

February 28, 2018757.7434

3PRIME URBAN Takaido

February 28, 2018

1,649.84

76

5

PRIME URBAN Nishi Ogikubo

February 28, 2018

543.0926

2PRIME URBAN Nishi Ogikubo II

February 28, 2018

2,088.78

93

10

PRIME URBAN Otsuka

February 28, 2018924.9146

4PRIME URBAN Komagome

February 28, 2018991.9435

4PRIME URBAN Ikebukuro

February 28, 2018

4,270.44

212

21

PRIME URBAN Monzen Nakacho

February 28, 2018

3,181.97

149

18

PRIME URBAN Kameido

February 28, 2018

1,117.34

50

6PRIME URBAN Nihonbashi
Yokoyamacho
PRIME URBAN Nihonbashi
Hamacho

PRIME URBAN Yotsuya Gaien
Higashi

PRIME URBAN Shinjuku
Naitomachi

PRIME URBAN Chitose
Karasuyama
NomuraReal
EstateReal
Partners estateCo., Ltd.
（Note 4)Contract termination

PRIME URBAN Sangen Jaya
PRIME URBAN Minami
Karasuyama
PRIME URBAN Karasuyama
Galleria

PRIME URBAN Denenchofu
Minami
PRIME URBAN Nagahara
Kamiikedai
PRIME URBAN Nakano
Kamitakada- 59 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017

Tenant Busine
namess type

Property namedate

Annual rent(m2)(Millions of Yen)

(Note 1)

(Note 2)

Leasehold andsecurity deposits(Millions of Yen)
(Note 3)February 28, 2018793.3537

4PRIME URBAN Mukojima

February 28, 2018

1,069.37

41

1

PRIME URBAN Kinshi Koen

February 28, 2018

1,861.85

81

8

PRIME URBAN Kinshicho

February 28, 2018991.6246

7

PRIME URBAN Hirai

February 28, 2018

1,075.25

47

5

PRIME URBAN Kasai

February 28, 2018865.6038

4PRIME URBAN Kasai II

February 28, 2018

1,437.84

63

7

PRIME URBAN Kasai East

February 28, 2018

1,884.62

75

7February 28, 2018

1,677.29

71

6

February 28, 2018876.7029

2February 28, 2018

3,978.93

137

35

PRIME URBAN Musashi Koganei

February 28, 2018

5,679.72

130

14

PRIME URBAN Musashino Hills

February 28, 2018

2,919.06

88

19

Kuyakushomae
PRIME URBAN Asakusa
PRIME URBAN Machiya South
Court

PRIME URBAN Koganei Honcho

February 28, 2018

PRIME URBAN Kumegawa

February 28, 2018

PRIME URBAN Musashi Kosugi
comodoFebruary 28, 2018

Contract
shallbeextendedfor additional termsof one year unless either
party notifies the other party
in writing of its intention toterminate this contract nolater than three months
prior to the expiration of
the initial term or any
extended term thereof.

1,528.3754

72,526.45

105

41

3,585.39

131

28

1,654.06

67

7

1,602.14

66

11

PRIME URBAN Kawasaki

February 28, 2018

PRIME URBAN Shinyurigaoka

February 28, 2018

PRIME URBAN Tsurumi Teraya

February 28, 2018895.7835

3PRIME URBAN Urayasu

February 28, 2018

1,264.84

54

7

PRIME URBAN Gyotoku I

February 28, 2018

1,129.24

42

4

PRIME URBAN Gyotoku II

February 28, 2018

1,244.00

47

3

PRIME URBAN Gyotoku Ekimae

February 28, 2018778.1933

3PRIME URBAN Gyotoku Ekimae II February 28, 2018907.1739

5PRIME URBAN Gyotoku III

February 28, 2018

1,674.68

61

6

PRIME URBAN Nishi Funabashi

February 28, 2018

1,237.80

53

6

PRIME URBAN Kawaguchi

February 28, 2018

2,436.25

108

27

PROUD FLAT Hatchobori

February 28, 2018942.51

52

5

PROUD FLAT Itabashi Honcho

February 28, 2018

1,166.51

46

5

PRIME URBAN Meguro Mita

February 28, 2018

1,080.45

53

5

February 28, 2019

1,418.60

69

5

PROUD FLAT Omori Ⅲ

February 28, 2019

1,358.80

66

8

PROUD FLAT Kinshicho

February 28, 2019

1,087.80

53

6

Contract
shallbeextendedfor additional terms
of
one
year
unlesseitherparty notifies the otherparty in writing of its
intention to terminate thiscontract no later than six
months prior to the
expiration of the initial termor any extended term
thereof.

3,275.25

120

40

6,515.00316

36

3,381.15

171

21

1,442.3570

61,855.24

77

10

-

200,550.36

9,214

1,415

PRIME URBAN Gakugei daigaku
parkfront

PRIME URBAN Shinkawa

February 28, 2018

PRIME URBAN Toyosu

February 28, 2018

PRIME URBAN Nihonbashi
Kayabacho
PRIME URBAN Yoga II

February 28, 2018
February 28, 2018

PRIME URBAN Musashi Koganei II February 28, 2018
Total
(Note 1)

Contract Extension

Leased area

PRIME URBAN Sumiyoshi

PRIME URBAN Itabashi

NomuraReal
EstateReal
Partners estateCo., Ltd.
（Note 4)Contract termination-

In the case of assets with a so-called pass-through master lease agreement, where the rent received from the lessee in the master lease agreement is thesame amount as the rent that the lessee receives from the end-tenant, the end-tenant is shown as the tenant, and the lessee is not shown as a tenant.
However, for residential facilities, the master lessee is shown as the tenant, and the leased area shown is that that actually rented and subject to the- 60 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 4th Fiscal Period Ended August 31, 2017tenant agreements with end tenants. “Tenant name” is not disclosed for some tenants, due to unavoidable circumstances.
(Note 2)

“Annual rent” is calculated by multiplying by 12 the sum of monthly rent and common area charges in lease agreements for each property actuallyconcluded with end-tenants that are valid as of the last day of August 2017 (this does not include parking space or other fees stated in parking spacelease agreements or other such agreements signed in addition to the tenant lease agreement. If common-use space, etc. is leased based on the leaseagreement, the rent for such is included, and if rent includes an amount equivalent to the fee for use of parking space, such amount is included. In
addition, if the master lessee has a rent-guaranteed master lease, the rent for the space covered in said lease is based on the rent, etc., in the leaseagreement concluded with the master lessee.); amounts less than one thousand yen are truncated. Accordingly, the sum of each tenant’s annual rent
may not be exactly the same as the figure given the “Total” row. Furthermore, regarding tenants who have been exempt from rent payment for acertain period of time in their agreements, such exemption period is not considered in the table above.

(Note 3)For residential facilities, the lessee of the master lease agreement shown in the “Tenant name” column receives leasehold and security deposits fromthe end-tenants and deposits this amount with NMF or the trustee as the leasehold and security deposits of the master lease agreement.

(Note 4)This client is an interested party of NMF as specified in the Investment Trust Act

D. Status of Major Properties
Not applicable.
E. Overview of Leasing to Interested Parties
As of August 31, 2017, some of the assets held by NMF at the same date were leased to interested parties
as defined in the Investment Trust Act.
The following is an overview of the status of leasing of said assets to interested parties as defined in theInvestment Trust Act.
Tenant name

Property name

Nomura Real Estate Partners
Co., Ltd.

Shinjuku Nomura Building
NRE Yotsubashi Building
Total of PROUD FLAT Shirogane-Takanawa,
and 115 others
Shinjuku Nomura Building
NMF Yokohama Nishiguchi Building
NRE Yotsubashi Building

Nomura Real Estate
Development Co., Ltd

Nomura Real Estate Life &Megalos Kanagawa
Sports Co.,Ltd.
Nomura Real Estate Urban Net
Shinjuku Nomura Building
Co., Ltd.
NMF Gotanda Ekimae Building
NMF Kichijoji Honcho Building
NMF Kawasaki Higashiguchi Building
NMF Yokohama Nishiguchi Building
NRE Nishi-Umeda Building
Geo Akamatsu Co., Ltd.
NRE Yotsubashi Building
Nomura Amenity Service Co.,NRE Yotsubashi Building
Ltd.

Leased area(m2)
1,021.25
1,024.91
198,504.20
6,625.91
94.83
1,369.84
6,217.85
1,740.51
198.90269.37216.54373.27404.41357.0680.01

F. Collateral
Assets held by NMF and offered as collateral at the end of the period under review are as follows.

Property Name

Type ofcollateral

Konami Sports Club Fuchu
Sagamihara Shopping Center

Mortgage
Mortgage

Secured party
Konami Sports Club Co., Ltd. (Note)
Ito-Yokado Co., Ltd. (Note)(Note) The secured claims are rights held by the security interest holders to claim the return of leasehold deposits.

- 61 -

Recent appraisal
value(Millions of Yen)
3,400
6,910