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

Invincible Investment Corporation
Asset Management Report
Fiscal Period ended June 30, 2020 (January 1, 2020 to June 30, 2020)
Content
Greetings from Naoki Fukuda, Executive Director of Invincible Investment Corporation and President & CEO
of Consonant Investment Management Co., Ltd.
Summary of Financial Results
Top Interview
Unitholder Benefit Program
I.
II.
III.
IV.
V.
VI.
VII.

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

Domestic Portfolio Map (As of June 30, 2020)
Financial Conditions

Overview of Unitholders/Investment Units
Information for Unitholders

Greetings from Naoki Fukuda, Executive Director of Invincible Investment Corporation and President& CEO of Consonant Investment Management Co., Ltd.
We would like to take this opportunity to express our sincere gratitude to all unitholders of Invincible Investment
Corporation ("INV") for your continued support. Our thoughts and prayers go out to all those who havecontracted the COVID-19 virus, as well as to their families and friends.
We hereby provide you with a report on INV's asset management and financial results for the 34th fiscal period(from January 1, 2020 to June 30, 2020) (the "Reporting Period").
During the Reporting Period, we acquired two hotels on January 6, 2020 and sold one residential property on
January 15, 2020 as part of asset recycling initiatives. As a result, we recorded a gain on sale of approximately
JPY 2 billion in the Reporting Period. However, as the impacts of the spread of COVID-19 became apparent
from the second half of February 2020, the number of both business and leisure trips decreased dramatically
due to requests by domestic and overseas governments for people to refrain from going outside, restrict travel,
government issued emergency declarations, and the request for people to refrain from traveling acrossprefectural boundaries. The environment surrounding the hotel industry, which is one of two core asset classesof INV, became extremely harsh. In response to the rapid and substantial decline in hotel occupancy rates, each
hotel made concerted efforts to reduce operating expenses, including temporary hotel closures, but this was
unable to compensate for the decline in revenues, which forced INV to accept a large-scale rent waiver from its
largest tenant.
As a result, both revenues and profits for the Reporting Period dropped significantly, with operating revenuesof JPY 9,410 million, operating income of JPY 1,496 million, and net income of JPY 423 million. INV decided
on a distribution per unit (DPU) of JPY 69. The Covid-19 pandemic has caused an end to seven consecutive
years of DPU growth.
In the residential property portfolio, another core asset class, NOI continued to exhibit stable growth in theReporting Period, supporting INV’s profitability. The existence of stable profits from the residential assets havealleviated any financial issues such as payment of interest on interest bearing debt. The relationship with ourlenders continues to be favorable, and in July we refinanced bank loans at reasonable funding costs in the fullamount, totaling over JPY 30 billion.
Our business outlook remains uncertain due to the COVID-19 pandemic. However, we believe that the hotel'soccupancy rate bottomed out in May, and we have begun initiatives to maximize hotel revenues under the newenvironment classified as “With Corona”. We, INV and its Asset Management Company, will make every effort
to manage assets with the aim of achieving a recovery in business performance while contributing to the bestinterests of unitholders.
-1-Your continued support is highly appreciated.
Naoki Fukuda
Executive Director, Invincible Investment Corporation
President & CEO, Consonant Investment Management Co., Ltd.

-2-

Summary of Financial Results
Period fromJanuary 1, 2018 toJune 30, 2018

Period from
July 1, 2018 to
December 31, 2018

Period fromJanuary 1, 2019 toJune 30, 2019

Period from
July 1, 2019 to
December 31, 2019

Period fromJanuary 1, 2020 toJune 30, 2020

Operating Revenues(JPY million)

13,104

14,451

27,33918,587

9,410

Ordinary Income(JPY million)

7,722

8,384

21,240

11,639424

Net Income(JPY million)

7,721

8,384

21,239

11,638423

Net Assets(JPY million)

181,523

221,364

233,046

259,730

249,538

Total Assets(JPY million)

374,512455,362

467,931522,431516,663

Net Assets per Unit
(JPY)

37,87139,063

41,12542,60140,929Net Assets/Total
Assets (%)

48.5

48.6

49.8

49.7

48.3

Distribution per Unit
(JPY)

1,430

1,683

1,656

1,725

69

4,793,181

5,666,840

5,666,840

6,096,840

6,096,840

Number of Units
Issued (Unit)

Distribution per unit for the 34th fiscal period(the fiscal period ended June 2020)

JPY 69(Note) The forward-looking statements, forecasts and goals described in this report are based on available information, assumptions and estimatesas of September 25, 2020. These assumptions and estimates are unavoidably uncertain, and could be affected by various risks andfactors beyond INV’s control. Thus, no guarantee can be made regarding the realization of such future forecasts and targets, and actual
results may vary significantly.

-3-Top Interview
Q: DPU for the June 2020 Fiscal Period decreased dramatically. What was the impact of COVID-19?
A: In a word, the impact was tremendous. Approximately 90% of our portfolio are hotel assets, based on
acquisition price. Regarding the demand for the hotels in Japan, travel was restricted due to the government's
declaration of a State of Emergency and the requests from local governments to stay home in a reaction
against the spread of COVID-19. Inbound tourists used to account for about 30% of the total hotel sales.
However, the number of inbound tourists to Japan from January - June 2020 declined by 76.3% comparedto the same period of the previous year. The government's entry ban started with Wuhan, China and thesubject area has been extended (146 countries as of August 12, 2020). These initiatives have reduced both
domestic and overseas demand for leisure and business travel to the extent that it’s not too much to say thatthey "disappeared." As a result, the hotel's performance deteriorated beyond expectations, and our revenues
declined significantly.
Relevant COVID-19 Events in Japan and Change in Hotel Occupancy
Change in INV’s Hotel Occupancy(Note 1) (Upper) / Number of New COVID-19 Patients in Japan(Note 2) (Lower)(Note 1) Average occupancy based on the MHM’s operating hotels owned by INV as of June 30, 2020
(Note 2) Source: Ministry of Health, Labor and Welfare

-4-

A

Jan. 16First domestic COVID-19 case in Japan

Jan. 27

Suspension of group tours to overseas by Chinese government

Feb. 13First domestic death from COVID-19 in Japan

Feb. 26

Prime Minister requested for the cancellation, postponement, or reduction in size of national sports and cultural eventsFeb. 29

TDR and USJ started to be closed

B

Mar. 11WHO declared COVID-19 outbreak a pandemic

C

Mar. 24

Announcement to postpone Tokyo 2020 Olympic GamesD

Apr. 7

Declaration of a State of Emergency for Tokyo and six other prefectures

E

Apr. 16

Declaration of the nationwide State of Emergency

F

May 4

Extension of State of Emergency until May 31

May 14

Lifted State of Emergency for 39 prefectures

May 25

Lifted State of Emergency for remaining prefectures

Jun. 2

Triggered “The Tokyo’s Coronavirus Alert”

Jun. 11

Lifted “The Tokyo’s Coronavirus Alert”

Jun. 19

Lifted the restriction on cross-prefectural movement

Jun. 30

The number of infected people in Japan exceeded 100 for 3 consecutive days

Jul. 1

TDR reopened

G

H

Jul. 6

The number of infected people in Tokyo exceeded 100 for 5 consecutive days

I

Jul. 10

Announcement of the Go To Travel campaign being pushed forward to July 22

J

Jul. 16

Tokyo excluded from the Go To Travel campaign

Jul. 22

Governor of Tokyo requested to avoid unnecessary or non-urgent outings

Jul. 30

Government of Tokyo requested restaurants, bars and karaoke parlors to reduce operating hours

Jul. 31 –The Prefectures of Okinawa, Gifu, Mie, and Aichi announced a State of Emergency

K

Aug. 5

Q: In the June 2020 Fiscal Period, INV waived the rent for one of the tenants. Please tell us about thedetails.
A: During the period from March - June 2020, we implemented the following measures for MyStays HotelManagement Co., Ltd. (MHM), which is the tenant of 73 of 84 domestic hotels of 148 properties owned by
INV as of the end of June 2020 Fiscal Period : (i) INV waived the fixed rent, (ii) INV bore the property
management costs that should be borne by MHM, and (iii) INV increased the management fees payable to
MHM. The upper limit for the total of (ii) and (iii) was set at JPY1.5 billion in consideration of MHM's
revenue and cash flow projections, while the actual paid amount was JPY1.35 billion.
Q: Is MHM, which was exempt from the rent payment, taking any measures to restore profitability?
A: MHM applied for employment adjustment subsidies, drastically reduced the number of temporary staff,
reduced the salaries of senior management by more than 20%, and substantially reduced hotel operating
expenses by thoroughly reviewing advertising and cleaning contract terms. MHM also strives to recoverdeclining demand and capture new demand created by COVID-19. Please refer to the below for details.

-5-Initiatives by MHM due to the Impact of COVID-19◼ Initiatives to stimulate hotel demand

Efforts to ensure safety for guests (Avoiding the 3C's)

Buffet's safe
operation

In response to the government’s request forvoluntary restraint, all buffets at the hotels werediscontinued and switched to several individual
dishes. Some of the buffets reopened in Julyunder thorough measures to aid in preventing
the transmission of COVID-19.

Meeting andbanquet plans to
avoid the 3C's

In order to capture conference and banquet
demand in the Covid-19 environment, MHM
provides special layout plans in order to avoid
the 3C's.

Employees are required to wear masks and rubber
gloves, and exchange tongs every 15 minutes



Thorough follow-up of cancelled / postponed events
Cancellations of banquets, training sessions, and meetings increased sharply in March. MHM has beenproactively working to recoup the cancelled events by proposing plans to avoid the 3C’s and changes in thetiming.



Stimulating domestic demand
Building on the strength of the MHM Group, which operates a diverse portfolio of hotels including resort andfull-service hotels, MHM is promoting the sales of “the MHM Voucher4 Plan” to its extensive list of corporateclients / individual customers.

◼ Efforts to Capture New DemandProvide a telework environment
With the increasing demand for telework MHM has started to provide hotel rooms for day-use or a special
successive stay for teleworking with unlimited Wi-Fi to accommodate the cases where people or corporates
would face difficulty securing a comfortable telework environment at home.



Delivery and Takeout Services
With the frequency of eating at home, MHM started to provide delivery services and takeout menus created
and widely distributed in various neighborhoods by MHM’s directly managed restaurants.



Acceptance of Self-quarantine Customers
Since March 2020, when the national government strictly regulated arrivals from abroad, MHM hasaggressively targeted corporations with many overseas employees to generate accommodation demandassociated with the 14-day voluntary quarantine period after returning to Japan.
Approached approximately 3,000 corporations to capture demand for hotels near airports, as well as hotels in
the Tokyo metropolitan area, such as Yokohama.

◼ Cost Cutting Initiatives
MHM is taking aggressive steps to reduce hotel operating expenses by reviewing all operations. Specificmeasures include temporary hotel closures and the suspension of non-essential capital expenditures as well as
taking government subsidies, cutting payments to service providers, significantly reducing marketing
expenses, utilities and other items.

-6-

1

Labor Costs

MHM reduced the labor costs across the portfolio hotels throughfurloughs and utilization of the government subsidy program as well
as minimization of overtime pay.

2

Room Cleaning
ExpensesIn response to the low occupancy environment, MHM renegotiated theminimum room counts for room cleaning expenses with the cleaning
vendors or internalized the room cleaning operations.

3

Various Fixed Expenses

MHM also renegotiated various fixed expenses including building
maintenance, public cleaning services, utilities, telecommunication,marketing expenses, and other outsourcing services.

4

Management Members’
Salaries

Senior management members at MHM have agreed to reduce theirmonthly salaries by at least 20% from May.

Q: What is the impact on the appraisal value?
A: Taking the impact of COVID-19 pandemic into account, appraisal companies made some changes in cashflow projections and adjusted cap rates for some hotel assets. As a result, the total appraisal value of the 145
properties we owned from the end of the December 2019 to the end of June 2020 decreased by 4.8% to JPY
526,836 million from JPY 553,449 million, and the NAV per unit and unrealized gain per unit also decreased.
However, we believe that the eradication of COVID-19 or the development of therapeutics will help theappraisal values in the future.
Q: Doesn’t INV have any problem in financial condition?
A: Recently, INV refinanced existing borrowings in the amount of JPY 31.5 billion in total, once in June 2020
and twice in July of the same year. All the borrowings were refinanced in the same amount as the existing
borrowing amount, without any problems. As of the end of June 2020, the LTV has increased modestly and
DSCR has declined, but INV has not violated any financial covenants on existing borrowings from ourlenders. We are carefully explaining the situation to each lender so they understand the situation.
Q: INV had retained earnings of JPY12.7 billion as of the end of December 2019. Why weren’t some of
the retained earnings used to supplement dividends for the June 2020 Fiscal Period, despite the decline
in dividends from the initial forecasts?
A: We still don't know how long the COVID-19 pandemic will last. As the outlook remains uncertain, we
decided that leaving the funds at hand without using them to supplement DPU for June 2020 Fiscal Period
would help maintain our financial stability for the time being and enable our growth over the medium tolong term, which would benefit investors. We will carefully consider the utilization of the retained earnings,
closely monitoring the situation in the future.

-7-

Q: What is your outlook for the future?
A: The environment surrounding hotels, our core asset, is still subject to a number of uncertainties. In particular,
reservation lead time tends to be shorter than before, therefore, it is extremely difficult to have a clear outlook
on our business and make reliable financial forecasts. We believe, at this point in time, it is prudent to keep
the forecast for the December 2020 Fiscal Period as "To Be Determined." However, signs of a recovery areobserved in recent hotel occupancy rates, and in the medium to long term, we expect a recovery and evengrowth in business performance, including the level of DPU.
In addition, we will continue to implement initiatives to drive further internal growth in our residential
portfolio. The rental income from the residential assets and commercial facilities covers most of our interest
payments on interest-bearing debt and our operating expenses. In addition, as we have a certain amount ofcash on hand, we do not anticipate any adverse effects on the future repayment of interest-bearing debt or
the payment of operating costs.
We sincerely apologize for the inconvenience caused to our investors, but we ask for your understanding.

Change in Hotel Occupancy(Note 1)(Note 1)

(Note 2)

Based on 75 hotel properties; of the 84 domestic hotel properties (including Sheraton Grande Tokyo Bay Hotel, the underlying asset of preferred equity interest held by
INV) owned as of June 30, 2020, 9 hotels with fixed-rent lease agreements are excluded, assuming all properties were owned since the beginning of 2019. The
performance for the pre-acquisition period, which is based on actual results provided by sellers with certain adjustments assuming INV owned them, are subject to change
caused by the adjustments based on differences in accounting treatments, since it is difficult to adjust them due to the timing even if the figures are based on actual
performance
As of August 31, 2020-8-

Unitholder Benefit Program
INV has introduced the unitholder benefit program to improve the satisfaction of its unitholders and expand theunitholder base. Eligible unitholders can stay at Sheraton Grande Tokyo Bay Hotel and all MyStays hotels at
special discount rates.
*Detailed information is sent to eligible unitholders along with this report.

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

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

Program Details

Stay with unitholder special discount rates at the above applicable hotels

Hotel Reservation

Available Period(Note 3)

◼Sheraton Grande Tokyo Bay Hotel
Reservation via phone or Email◼ All MyStays hotels
Reservation via designated website posting accommodation plans for theunitholder benefit program
From April 1 to September 30 (eligible unitholders as of December 31)
From October 1 to March 31 (eligible unitholders as of June 30)

Sheraton Grande Tokyo Bay Hotel

Hotel Epinard Nasu

Fusaki Beach Resort Hotel & Villas(Note 1)

Hotel MyStays Premier Akasaka

The details of the unitholder benefit program described above are as planned by Invincible as of August 31, 2020, and the program may be changed or abolishedeven after it is has been introduced.

-9-

(Note 2)(Note 3)

Refers to all hotels under MyStays brand managed by MHM, and hotels shown on the MyStays Hotel Group’s official website (https://www.mystays.com/enus/) will be applicable.
Available Period represents a period during which you can lodge by using the unitholder benefit program. To enjoy the unitholder benefit program, you actuallyneed to lodge during the availability period.

- 10 -

I.

Asset Management Report

Overview of Asset Management
1

Trends in Investment Corporation’s Operating Results
30th

31st

32nd

33rd

34th

fiscal period

fiscal period

fiscal period

fiscal period

fiscal period

Jan. 1, 2018 toJul. 1, 2018 toJan. 1, 2019 toJul. 1, 2019 toJan. 1, 2020 toJun. 30, 2018

Dec. 31, 2018

Jun. 30, 2019

Dec. 31, 2019

Jun. 30, 2020

(Note 1) (JPY thousand)

13,104,841

14,451,005

27,339,670

18,587,253

9,410,225(Rental revenue – real estate)(JPY thousand)

11,122,481

13,604,224

12,153,399

14,545,826

5,838,836

Operating expenses(JPY thousand)

4,671,320

4,936,248

5,154,599

5,728,269

7,913,247(Property-related expenses)(JPY thousand)

4,136,619

4,450,676

4,490,658

4,673,007

6,801,584

Operating income(JPY thousand)

8,433,520

9,514,756

22,185,070

12,858,984

1,496,977

Ordinary income(JPY thousand)

7,722,553

8,384,676

21,240,482

11,639,553

424,522

Net income(JPY thousand)

7,721,948

8,384,071

21,239,877

11,638,948

423,917

Total assets(a) (JPY thousand)

374,512,988

455,362,796

467,931,975

522,431,999

516,663,418

(%)

0.7

21.6

2.8

11.5

(1.1)

(JPY thousand)

189,415,000

229,873,000

228,774,000

259,174,000

263,468,000(b) (JPY thousand)

181,523,263

233,046,414
5.3

249,538,194

0.1

221,364,900
21.9

259,730,758

(%)

11.5

(3.9)

Unitholders’ capital(JPY thousand)

168,798,455

211,092,540

211,092,540

235,701,512

235,701,512

Total distributions(c) (JPY thousand)

6,854,248

9,537,291

9,384,287

10,517,049

420,681(Note 2) (%)

88.8

110.3

44.2

90.4

99.2

(d) (Units)

4,793,181

5,666,840

5,666,840

6,096,840

6,096,840(b) / (d) (JPY) (Note 3)

37,87139,063

41,12542,60140,929By Period

Reporting period

Operating revenue

Operating Results(change from last period)

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

Dividend
StatusDividend payout ratio
Number of investment units

Information per Unit

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

1,430

1,683

1,656

(JPY)

1,430

1,632

1,656

1,725
1,725

69

(Distributions of earnings per unit)(Distributions in excess of retained

(JPY)

―

51

―

―

―

2.1

2.0

4.6

2.4

0.1

4.2

4.0

9.3

4.7

0.2

4.3

4.2

9.3

4.7

0.2

8.6

8.3

18.9

9.4

0.3

(%)

48.5
(0.3)

48.6
0.1

49.8
1.2

49.7
(0.1)

(1.4)

(Note 4) (JPY thousand)

9,758,373

12,192,581

11,247,273

14,490,677

3,392,004

Distributions per unit

69

earnings per unit)
Return on assets(annualized)

Financial Measures

Return on equity(annualized)
Capital ratio(change from last period)(Note 4) (%)(Note 4) (%)(b) / (a) (Note 4) (%)

NOI(Net Operating Income)

48.3(Note 1) Consumption taxes etc. are not included in the items including operating revenues.
(Note 2) Dividend payout ratio is calculated in accordance with the following formula and rounded to one decimal place:
Dividend payout ratio = Distribution amount (Excluding distributions in excess of retained earnings) ÷ Net income × 100(Note 3) Net assets per unit are rounded to the nearest unit.

- 11 -

(Note 4) Figures above are calculated as below, and ratios are rounded to one decimal place.
Return on assets = Ordinary income for relevant period / (Total assets at start of relevant period + Total assets at end of
relevant period) / 2) x 100.
Return on equity = Net income for relevant period / (Net assets at start of relevant period + Net assets at end of relevant
period) / 2) x 100.
Capital ratio = Net assets at end of relevant period / Total assets at end of relevant period x 100.
NOI = Rental revenue – Property-related expenses + Management contract revenue - Management contract expenses +Depreciation expense for relevant period- 12 -

2

Overview of Asset Management for the Fiscal Period Ended June 2020(a)Main Trends of INV

INV was established in January 2002 in accordance with the Investment Trust and Investment Corporation Act (Act No. 198of 1951, as amended; the “Investment Trust Act”). In May 2004, INV was listed on the Osaka Securities Exchange(application for delisting was made in August 2007), and in August 2006 was listed on the Real Estate Investment and Trust
Securities Section of the Tokyo Stock Exchange (Ticker Code: 8963).
After the absorption-type merger with LCP Investment Corporation (“LCP”) was implemented on February 1, 2010, INV
issued new investment units through a third-party allotment on July 29, 2011 and refinanced its debt. Calliope Godo Kaisha(“Calliope”), an affiliate of the Fortress Investment Group LLC (“FIG” and together with Calliope and other affiliates of
FIG, collectively the “Fortress Group”) was the main allottee, and the sponsor changed to the Fortress Group.
FIG became a subsidiary of SoftBank Group Corp. (“SoftBank Group”), after SoftBank Group acquired FIG effective on
December 27, 2017 (Note 1). Calliope, an affiliate of FIG, who owned 100% of the issued shares of Consonant Investment
Management Co., Ltd., the asset manager to which INV entrusts the management of its assets (the “Asset Manager”),
transferred 80.0% of issued shares of the Asset Manager to Fortress CIM Holdings L.P., a subsidiary of SoftBank Group,and 20.0% to SoftBank Group on March 29, 2018, pursuant to the basic agreement which was entered into as of September
7, 2017. Although FIG is no longer an indirect parent company of the Asset Manager, FIG continues to support INV as thesponsor.
Ever since the commencement of sponsorship from the Fortress Group (Note 2), INV has been focusing its efforts on
improving the profitability of its portfolio and establishing a revenue base in order to secure stable distributions, and has
strengthened the lender formation through new borrowings and the refinancing of existing bank borrowings, thereby creating
a financial base for external growth. With this platform as a base, in June 2014, the Asset Manager revised the Investment
Guidelines for INV, positioned hotels as a core asset class alongside residential properties with a view towards expanding
investments in the hotel sector in which demand is forecasted to rise going forward, and has expanded its portfolio.
Moreover, the Asset Manager revised the Investment Guidelines as of July 17, 2018. Such revision was intended toestablish an investment policy and asset management structure regarding investments in overseas assets, and also to change
the investment policy regarding domestic hotels to focus on (i) Limited service hotels, which feature relatively higher profit
margins and potential for revenue growth backed by increasing demand for accommodations, and (ii) Full-service and Resort
hotels, which have a variety of revenue sources, including lodging, dining and sales of goods, that are expected to achieve
stable growth in overall hotel revenues. Based on such change in investment policy, in July 2018, INV decided on theacquisition of TK (Japanese anonymous association (tokumei kumiai)) interest in two overseas hotels, “Westin Grand
Cayman Seven Mile Beach Resort & SPA” and “Sunshine Suites Resort” (collectively, the “Cayman Hotels”) as underlying
assets for the first time ever in J-REIT history. In September 2018, INV implemented the investment in the Cayman Hotels
via a global offering of new investment units and borrowing of funds. INV intends to improve both the profitability andstability of the portfolio through such investments, including investment in the Cayman Hotels, which is expected to evenout the effects of seasonality in INV’s portfolio.
In the Fiscal Period ended June 30, 2020 (“Reporting Period”), INV acquired two hotels on January 6, 2020 and sold one
residential property on January 15, 2020. As a result, INV's portfolio at the end of the Reporting Period comprised of 148
properties (86 hotels (Note 3) (Note 4), 60 residential properties and two others) with a total acquisition price of JPY 511,695
million (Note 5). The total acquisition price of the portfolio has significantly grown by 7.1 times, compared to the portfolio
as of May 22, 2014, which is the date immediately prior to INV’s initial investment in hotels. Furthermore, INV’s hotel
portfolio has reached the largest asset size (Note 6) of JPY 450.6 billion (86 properties, 15,597 rooms) among all J-REIT
hotel portfolios including hotel-and-inn-specific type investment corporations.

(Note 1)US Eastern Standard Time- 13 -

(Note 2)

As of July 2011, Calliope owned 97.35% of issued shares of the Asset Manager and the investment ratio reached100% in October 2013. Calliope transferred 80.0% of issued shares to Fortress CIM Holdings L.P., a subsidiaryof SoftBank Group and 20.0% to SoftBank Group on March 29, 2018. As of the date of this document,
SoftBank Group owns 100% of issued shares of the Asset Manager directly and indirectly.
(Note 3) The preferred equity interest held by INV is counted as one property. Such preferred equity interest issued bya special purpose company (tokutei mokuteki kaisha) refers to 178,458 units of the preferred equity interest
issued by Kingdom Special Purpose Company (the “TMK”) (equivalent to 49.0% of the total issued andoutstanding preferred equity interest), which owns the trust beneficiary interest of the Sheraton Grande Tokyo
Bay Hotel as an underlying asset. The property is classified as a hotel, based on the use of Sheraton GrandeTokyo Bay Hotel, the underlying asset of the preferred equity interest, and INV’s investment amount of thepreferred equity interest is used as the acquisition price of the preferred equity interest, unless otherwise stated.
The “underlying asset” refers to the real estate or the real estate related assets owned by a TK operator of TK
interest or a TMK relating to the preferred equity interest which INV owns, thus the real estate or the real estate
related assets which will be the revenue source of INV. Hereinafter the same shall apply.
(Note 4) From September 28, 2018 (Cayman Island local time; September 29, 2018 in Japan local time), INV owned
100% of the TK interest in Seven Mile Resort Holdings Ltd. (the “Cayman SPC”), a Cayman Islands special
purpose company that holds leasehold interests in the Cayman Hotels and ancillary assets as underlying assets.
However, INV implemented the investment structure change (the “Structure Change” in some cases hereinafter)
regarding the Cayman Hotels on May 9, 2019 (Cayman Island local time; May 10, 2019 in Japan local time) andhas directly held the Leasehold Interests, etc. of the Cayman Hotels thereafter. Both of the TK interest and the
Cayman Hotels are counted as two properties before and after the Structure Change. In addition, the “Leasehold
Interests, etc.” means leasehold interests (rights equivalent to long-term real estate leases on land and buildings
under the British Cayman laws) and furniture, fixtures, equipment, ornaments, kitchen instrument, and otherassets required for hotel operations. Hereinafter the same shall apply.
(Note 5) Due to the Structure Change, the book value of the leasehold interests of the Cayman Hotels recorded by the
Cayman SPC as of May 9, 2019 (Cayman Island local time; May 10, 2019 in Japan local time), when INV
succeeded the leasehold interests of the Cayman Hotels from the Cayman SPC via distribution in kind inconnection with the termination of TK agreement, is deemed as the acquisition price of the Cayman Hotels. The
book value is converted into JPY amount via exchange rate of USD 1=JPY 110.45 based on the foreign exchange
forward contracts concluded on July 26, 2018 and executed on September 26, 2018 in connection with theinvestment in the TK interest by INV. Hereinafter the same shall apply.
(Note 6) “The largest asset size … among all J-REIT hotel portfolios” refers to the total acquisition price of 86 hotels
owned by INV as compared with the total acquisition price of hotels (including inns and other accommodation
facilities) owned by listed investment corporations other than INV as of June 30, 2020.
(b)

Operational Environment and Performance

Both the domestic and overseas hotel portfolios for the Reporting Period were heavily affected by the effects of COVID-19
including the State of Emergency issued by the Japanese Government on the economy and tourism. On May 11, 2020,
INV entered into a Memorandum of Understanding (“MOU”) to amend each fixed-term building lease and property
management agreement ("MLPM Agreements") for domestic hotels owned by INV and operated by INV's main tenant,
MyStays Hotel Management Co., Ltd. and its affiliates (collectively, “MHM Group”). Pursuant to the MOU, INV (i)waived the fixed rent during the relevant period and changed the calculation method of the variable rent by way ofamendment of the MLPM Agreements in part and (ii) bore some property management costs that would normally be borneby the MHM Group under the former agreement and (iii) increased the amount of the management fees payable to the MHM
Group (Note 1). As a result, the total amount of property management costs and incremental management fees incurred by
INV from March to June 2020 totaled JPY 1,350 million, which was initially estimated to be up to JPY 1,500 million.
The occupancy rate of the rental housing market remained stable at a high level. The rent increase program of 60 residential
properties (Note 2) continues to produce positive results, as rent has increased for both new and renewal contracts ofproperties owned by INV. The average rent per tsubo per month (Note 3) for the Reporting Period increased by 0.6% YoY- 14 -

to JPY 9,098, and the operating conditions remained firm.
For the June 2020 fiscal period, the portfolio NOI (Note 4) decreased by 72.7% or JPY 10,708 million to JPY 4,026 million
compared to the same period in the previous year (the June 2019 fiscal period). The hotel portfolio NOI decreased by JPY
9,878 million, which is equivalent to the decrease by 67.0% of the portfolio NOI. While the residential portfolio continues
to benefit from internal growth, the residential portfolio NOI (Note 5) decreased by JPY 826 million, which is equivalent to
the decrease by 5.6% of the portfolio NOI, due to asset sales as part of INV’s asset recycling. The portfolio continued tomaintain a high average occupancy rate (Note 6) of 99.3% for the Reporting Period.
Commentary on hotel and residential performance in the Reporting Period is as described below.
The NOI for the Reporting Period of the 75 domestic hotels (Note 7) owned by INV decreased by 92.5% compared to thesame period in the previous year (figures exclude nine domestic hotels with fixed-rent lease agreements among the 84
domestic hotels owned by INV as of the end of the Reporting Period, including Sheraton Grande Tokyo Bay Hotel, theunderlying asset of the preferred equity interest of TMK owned by INV). The 75 domestic hotels recorded an occupancy
rate (Note 8) of 48.1% (-38.7 points YoY), ADR (Note 9) of JPY 7,229 (-28.5% YoY), and RevPAR (Note 10) of JPY 3,478(-60.4% YoY).
Westin Grand Cayman Seven Mile Beach Resort & Spa and Sunshine Suites Resort recorded an average occupancy rate of
37.5% (-51.7 points YoY), ADR of USD 487 (+17.2% YoY), and RevPAR of USD 183 (-50.7% YoY) for the Reporting
Period.
Regarding the hotel sector, the domestic hotel demand significantly declined due to a sharp reduction in inbound visitors(JNTO’s estimate for January to June 2020: -76.3% YoY) and a shift in mindset to refrain from business trips and leisuretravel. In the Cayman Islands, where the Cayman Hotels are located, the temporary closure of the Owen Roberts
International Airport caused a significant reduction in hotel demand and the Cayman Hotels closure from late March throughthe end of October.
Regarding the residential portfolio, the average occupancy rate (Note 6) of 60 residential properties (Note 2) for theReporting Period was 96.2%, an increase of 0.2 points compared to the same period in the previous year. The NOI (Note5) of the 60 residential properties for the Reporting Period increased by 1.9% compared to the same period in the previous
year, due to internal growth through solid rent increases. For the rental residential market, COVID-19 seems to have no
impact and trends for rent at city-center residential properties with small-type rooms maintained a moderate increase.
Under such circumstances in the macro environment, INV continues to focus on its rent increase program for both newleases and renewals as well as initiatives to reduce residential leasing costs based on a detailed market analysis of each
property and unit.
In the Reporting Period, INV realized a rent increase for 52.0% (based on the number of contracts) of the new residential
lease contracts for an average rent increase of 0.7% compared to the previous rent across all new leases (Note 11). INV
achieved a rent increase for 46.6% (based on the number of contracts) of contract renewals for an average rent increase of
1.6% compared to the previous rent across all renewal leases (Note 11), while maintaining a high contract renewal rate (Note12) of 80.7%. Combined, new leases and renewal leases were signed at 1.3% higher than the previous leases (Note 11).
The total appraisal value of 147 properties was JPY 542,336 million (one out of the 148 properties owned by INV at the endof the Reporting Period is excluded from the appraisal calculation: Sheraton Grande Tokyo Bay Hotel (preferred equity
interest) for which the appraisal value of such interest is not available). The portfolio has an unrealized gain of JPY 65,080
million (Note 13) and an unrealized gain ratio of 13.6% (Note 13). The total appraisal value of 145 properties which were
owned throughout the Reporting Period decreased by 4.8% from JPY 553,449 million at the end of the December 2019 fiscal
period to JPY 526,836 million at the end of the Reporting Period.

Key Performance Indicators of 75 Domestic Hotel Properties (Note 7)- 15 -

June 2020 fiscal period

Year-on-year change

Occupancy Rate (Note 8)

48.1%-38.7pt

ADR (JPY) (Note 9)7,229-28.5%

RevPAR (JPY) (Note 10)3,478-60.4%GOP (JPY million) (Note 14)413-96.4%Key Performance Indicators of Cayman Hotels
June 2020 fiscal period

Year-on-year change

Occupancy Rate (Note 8)

37.5%-51.7pt

ADR (USD) (Note 9)487+17.2%

RevPAR (USD) (Note 10)183-50.7%

8,502,469-68.1%GOP (USD) (Note 14)

Key Performance Indicators of 60 Residential Properties (Note 2)
June 2020 fiscal period
Occupancy Rate (Note 6)
Average Rent per Tsubo per Month(JPY) (Note 3)
NOI (JPY million) (Note 5)(Note 1)

(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)(Note 8)Year-on-year change

96.2%+0.2pt

9,098

+0.6%

1,656

+1.9%

Under the MOU, the monthly total amount of property management costs and incremental management fees
incurred by INV from March to June 2020 was JPY 362 million for March, JPY 644 million for April, JPY 343
million for May and JPY 0 million for June. As a result, the domestic hotel NOI of each month was JPY -252
million for March, JPY -642 million for April, JPY -416 million for May and JPY -86 million for June.
Based on the 60 residential properties owned as of the end of June 2020. Hereinafter the same shall apply.
“Average Rent per Tsubo per Month” is calculated by dividing the total rental revenue (including common area
charges) for each month by the sum of total leased area (tsubo) at the end of each month during the relevant
period.
“NOI” for the hotel properties is calculated in accordance with the following formula:
NOI＝ Rental Revenues ‐ Property Related Expenses + Depreciation Expenses + Dividend on the preferred
equity interest (TMK dividend) + TK distribution + (Management Contract Revenue of the Cayman Hotels‐Management Contract Expense)
For the comparison of NOI for the residential properties, one-off insurance-related revenues and expenses are
excluded. Hereinafter the same shall apply.
“Average Occupancy Rate” and “Occupancy Rate” for the portfolio or the residential properties are calculatedby dividing the sum of total leased area by the sum of total leasable area at the end of each month during therelevant period.
Of the 84 hotels held as of the end of the June 2020 Fiscal Period (including the Sheraton Grande Tokyo Bay
Hotel, the underlying asset of the preferred equity interest of TMK owned by INV), the following nine hotels
with fixed-rent lease agreements are excluded: Super Hotel Shinbashi/Karasumoriguchi, Comfort Hotel Toyama,
Super Hotel Tokyo-JR Tachikawa Kitaguchi, Super Hotel JR Ueno-iriyaguchi, Comfort Hotel Kurosaki, Comfort
Hotel Maebashi, Comfort Hotel Tsubame-Sanjo, Comfort Hotel Kitami and Takamatsu Tokyu REI Hotel. In
addition, the figures for the properties acquired after January 2019 are calculated on the assumption INV had
acquired those properties on January 1, 2019, using the actual figures provided by the sellers of such properties
for the period before the acquisition. Hereinafter the same shall apply.
“Occupancy rate” for the hotel properties is calculated in accordance with the following formula:
Occupancy rate = total number of occupied rooms during a certain period ÷ total number of rooms available- 16 -

during the same period (number of rooms x number of days)
Hereinafter the same shall apply.
(Note 9) “ADR” means average daily rate, and is calculated by dividing total room sales (excluding service fees) for acertain period by the total number of days per room for which each room was occupied during the same period.
Hereinafter the same shall apply.
(Note 10) “RevPAR” means revenues per available room per day, and is calculated by dividing total room sales for a certain
period by total number of rooms available (number of rooms x number of days) during the same period, and is
the same as the figure obtained by multiplying ADR by occupancy rates. Hereinafter the same shall apply.
(Note 11) Increase or decrease in the sum of monthly rents on new or renewal contracts, or the total of both, compared withthe sum of previous rents.
(Note 12) Renewal rate is calculated by the number of renewed contracts during the Reporting Period divided by the numberof contracts due up for renewal during the Reporting Period(Note 13) The unrealized gain is calculated using the following formula: the appraisal value as of the end of the Reporting
Period - book value as of the end of the Reporting Period.
The unrealized gain ratio is calculated using the following formula: the unrealized gain ÷ book value as of theend of the Reporting Period.
(Note 14) “GOP” means the gross operating profit, and is the amount remaining after deducting costs of hotel operations(the personnel, utility and advertising expenses and other expenses) and the management services fee to operators(if any) from the hotel’s revenues. Moreover, GOP for the Sheraton Grande Tokyo Bay Hotel has been
multiplied by 49%, or INV’s ownership ratio of the preferred equity interest. Hereinafter the same shall apply.
(c)

Overview of Fund Raising

As a result of the measures described below, INV’s interest-bearing debt outstanding balance was JPY 263,468 million andthe Interest-Bearing Debt ratio (Note 1) and LTV (appraisal value basis) (Note 2) were 50.8% and 46.8% respectively, as ofthe end of the Reporting Period, with an average interest rate (Note 3) of 0.54%.

(Note 1)

(Note 2)(*)

(Note 3)

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

(i) Borrowing of Funds
INV borrowed New Syndicate Loan (Q) (total amount borrowed: JPY 12,483 million; interest rate: variable interest rate of
1-month JPY TIBOR plus 0.50000% (duration: five years; borrowed on March 16, 2020; by the interest swap agreement, it
is fixed, in effect, at 0.48700%), 1-month JPY TIBOR plus 0.50000% (five years; March 30, 2020) and 1-month JPY TIBOR
plus 0.30000% (three years; March 30, 2020)), which was arranged by Mizuho Bank, Ltd. in order to repay New Syndicate
Loan (G) in the amount of JPY 3,250 million due on March 14, 2020 and New Syndicate Loan (F) in the amount of JPY
10,433 million due on March 30, 2020.
INV borrowed Term Loan (M) on June 15, 2020 (total amount borrowed: JPY 1,000 million; interest rate: variable interest
rate of 1-month JPY TIBOR plus 0.25000% for duration of two years), which was arranged by Citibank, N.A. Tokyo Branch- 17 -

in order to repay Term Loan (C) in the amount of JPY 1,000 million due on June 15, 2020.
In addition, a portion of INV’s existing loans (New Syndicate Loan (P)) from Sumitomo Mitsui Trust Bank, Limited of JPY
4,550 million was transferred to Momiji Bank and The Kiyo Bank in the amount of JPY 1,000 and 500 million, respectively
on February 28, 2020.
(ii) Prepayment of Loan
INV’s short-term consumption tax loan (Note 1) in the New Syndicate Loan (L) (in the amount of JPY 2,686 million) was
prepaid on May 29, 2020 from the consumption tax refund concerning asset acquisitions on July 19, 2019 and cash on hand.
(Note 1) Short-term consumption tax loan is a loan which is to be repaid before the maturity date from a refund of
consumption taxes and regional consumption taxes on an acquisition of a property.
(iii) Issuance of Investment Corporation Bonds
INV issued its investment corporation bonds as follows for the purpose of raising a portion of funds for repayment of existing
borrowings while at the same time lowering its financing costs, lengthening the average maturity period of its debt and further
diversifying repayment dates for interest-bearing debt.
Bond Series

Issue Date

Sixth Series Unsecured
Investment Corporation Bonds(with pari passu conditions
among specified corporate
bonds)March 13,2020

Issue Amount(JPY million)

1,200- 18 -

Interest Rate(annual rate)

Redemption
Date

Abstract

0.850%March 13,2030

Unsecured /Unguaranteed
Rating: A+
(JCR)

(d)

Overview of Acquisition of Assets

INV completed the acquisition of trust beneficiary interests in two domestic hotels as follows on January 6, 2020.

Property Name

Acquisition
Price(JPY million)(Note 1)

Appraisal Value(JPY million)(Note 2)

D82

Hotel MyStays Premier
Narita10,593

10,700Adria Tokutei Mokuteki
KaishaD83

Art Hotel Morioka

5,643

5,700

Heijo Tokutei Mokuteki
Kaisha16,236

16,400-Property
Number

Total(Note 1)
(Note 2)(e)SellerAcquisition Price does not include adjustments for property taxes, city planning taxes, or national or local
consumption taxes. Hereinafter the same shall apply.
Appraisal Value is based on appraisal value stated in the appraisal report by The Tanizawa Sōgō Appraisal Co.,
Ltd. or JLL Morii Valuation & Advisory K.K. on the valuation date of October 1, 2019.

Overview of Sale of Assets

INV completed the sale of trust beneficiary interests in one residential property, City House Tokyo Shinbashi as follows on
January 15, 2020.

Property
Number

Property Name

Acquisition
Price(JPY million)

Book Value(JPY million)(Note 1)

Sale Price(JPY million)(Note 2)Gain on Sale
(JPY million)(Note 3)

Transferee

A51

City House
Tokyo Shinbashi

2,520

2,269

4,465

2,046

Undisclosed(Note 4)(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(f)

Book Value shows the figure as of the date of sale.
Sale Price does not include transfer related cost, adjustments for fixed asset taxes or city planning taxes, or
national or local consumption taxes.
Gain on Sale is calculated by deducting the Book Value and transfer related costs from Sale Price.
The name of the transferee is not disclosed, as the transferee’s consent has not been obtained for disclosure.
Amounts are rounded down to the nearest million yen.

Overview of Results of Operations and Distributions

As a result of the operations mentioned above, operating revenues for the Reporting Period decreased by JPY 9,177 million
from the previous period (-49.4%) to JPY 9,410 million, net income decreased by JPY 11,215 million (-96.4%) to JPY 423
million and unappropriated retained earnings including the retained earnings carried forward from the preceding fiscal period(JPY 12,744 million) reached JPY 13,168 million.
INV decided that distribution per unit (excluding excess profit distribution) is JPY 69 and does not make reversal of theretained earnings carried forward from the preceding fiscal period.

- 19 -

3

Changes in Total Number of Investment Units Issued and Outstanding

Changes in the number of investment units issued and outstanding and unitholders’ capital for the past 10 years up to the end of
the Reporting Period are as follows.

Date
July 29, 2011
December 20, 2013

Type of issue
Third-party
allotment
Third-party
allotment

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

Unitholders’ capital (JPY)
Increase

Total

Reference

711,597

1,348,292

6,999,979,689

26,134,396,789(Note 1)

224,887

1,573,179

2,999,992,580

29,134,389,369(Note 2)

July 16, 2014

Public offering

1,040,000

2,613,179

22,747,920,000

51,882,309,369(Note 3)

August 13, 2014

Third-party
allotment

55,5072,668,686

1,214,104,611

53,096,413,980(Note 4)

July 15, 2015

Public offering

500,000

3,168,686

27,970,500,000

81,066,913,980(Note 5)

August 12, 2015

Third-party
allotment

25,0003,193,686

1,398,525,000

82,465,438,980(Note 6)

March 30, 2016

Public offering

459,5123,653,198

36,123,157,344

118,588,596,324(Note 7)

22,626

3,675,824

1,778,675,112

120,367,271,436(Note 8)-3,675,824

224,225,264

120,591,496,700(Note 9)April 27, 2016

February 22, 2017

Third-party
allotment
Reversal of
allowance fortemporarydifferences
adjustment

March 13, 2017

Public offering

185,000

3,860,824

8,393,450,000

128,984,946,700(Note 10)October 12, 2017

Public offering

887,959

4,748,783

37,917,625,218

166,902,571,918(Note 11)

November 1, 2017

Third-party
allotment

44,3984,793,181

1,895,883,396

168,798,455,314(Note 12)

August 1, 2018

Public offering

909,524

5,702,705

40,280,089,388

209,078,544,702(Note 13)

August 21, 2018

Third-party
allotment

45,476

5,748,181

2,013,995,612

211,092,540,314(Note 14)

December 28, 2018

Retirement(81,341)

5,666,840-

211,092,540,314(Note 15)

July 18, 2019

Public offering

409,524

6,076,364

23,317,887,036

234,410,427,350(Note 16)

Third-party
20,476
6,096,840
1,165,882,964
235,576,310,314 (Note 17)
allotment
Reversal of
allowance for
6,096,840
125,201,855
235,701,512,169 (Note 18)
August 22, 2019
temporarydifferences
adjustment(Note 1) New investment units were issued in a third-party allotment at a price of JPY 9,837 per unit to make repaymentof existing loan, etc.
(Note 2) New investment units were issued in a third-party allotment at a price of JPY 13,340 per unit to make repaymentof existing loan, etc.
(Note 3) New investment units were issued in a public offering at a price of JPY 22,688 per unit (JPY 21,873 after
deducting the underwriters’ discount) to raise funds for the acquisition of new properties.
August 15, 2019- 20 -

(Note 4)

New investment units were issued in a third-party allotment at a price of JPY 21,873 per unit for the purpose of
cash reserve to appropriate to repayment in future borrowings.
(Note 5) New investment units were issued in a public offering at a price of JPY 57,817 per unit (JPY 55,941 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 6) New investment units were issued in a third-party allotment at a price of JPY 55,941 per unit for the purpose of
allocation to cash reserves to be used as part of the funds for future acquisition of properties.
(Note 7) New investment units were issued in a public offering at a price of JPY 81,217 per unit (JPY 78,612 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 8) New investment units were issued in a third-party allotment at a price of JPY 78,612 per unit for the purpose of
allocation to cash reserves to be used as a part of the funds for future acquisition of specified assets.
(Note 9) INV decided at the Board of Directors' Meeting held on February 22, 2017, the reversal of allowance fortemporary difference adjustments for incorporation into unitholders' capital.
(Note 10) New investment units were issued in a public offering at a price of JPY 46,897 per unit (JPY 45,370 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 11) New investment units were issued in a public offering at a price of JPY 44,118 per unit (JPY 42,702 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 12) New investment units were issued in a third-party allotment at a price of JPY 42,702 per unit for the purpose of
allocation to cash reserves to be used as part of the funds for future acquisition of specified assets.
(Note 13) New investment units were issued in a public offering at a price of JPY 45,776 per unit (JPY 44,287 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 14) New investment units were issued in a third-party allotment at a price of JPY 44,287 per unit for the purpose ofraising a part of the funds for the acquisition of new properties.
(Note 15) INV acquired own investment units from December 13, 2018 to December 18, 2018 (on a trade date basis)through the market purchase at Tokyo Stock Exchange based on a discretionary transaction contract with asecurities company.
INV resolved the retirement of all the acquired own investment units at the Board of Directors' Meeting held on
December 25, 2018 and the acquired own investment units were retired on December 28, 2018.
The acquisition of own investment units was conducted using capital surplus, and thus there is no change tounitholders’ capital.
(Note 16) New investment units were issued in a public offering at a price of JPY 58,898 per unit (JPY 56,939 after
deducting the underwriters’ discount) to raise a part of the funds for the acquisition of new properties.
(Note 17) New investment units were issued in a third-party allotment at a price of JPY 56,939 per unit for the purpose ofraising a part of the funds for the acquisition of specified properties.
(Note 18) INV decided at the Board of Directors' Meeting held on August 22, 2019, the reversal of allowance for temporary
difference adjustments for incorporation into unitholders' capital.

Trends in Trading Prices of Investment Securities
The highest and lowest prices (trading prices) in the Real Estate Investment and Trust Securities Section of the Tokyo Securities
Exchange on which the investment securities of INV are listed are as follows.
Real Estate Investment and Trust Securities Section, Tokyo Securities Exchange(Unit: JPY)
PeriodClosing month
HighestLowest30th fiscal
periodJune
201853,00046,65031st fiscal
periodDecember
2018
51,00044,80032nd fiscal
periodJune
201960,70044,300- 21 -

33rd fiscal
periodDecember
2019
70,60055,70034th fiscal
periodJune
2020
62,30018,8704Distribution PerformanceWith respect to distributions of earnings for the Reporting Period, INV decided that distribution per unit (excluding excess
profit distribution) is JPY 69 and does not make distributions in excess of profits.

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

30th fiscal
periodJan. 1, 2018 toJun. 30, 2018

31st fiscal
periodJul. 1, 2018 to
Dec. 31, 2018

32nd fiscal
periodJan. 1, 2019 toJun. 30, 2019

33rd fiscal
periodJul. 1, 2019 toDec. 31, 201934th fiscal
periodJan. 1, 2020 toJun. 30, 2020

7,610,548

9,140,372

21,131,966

23,261,426

13,168,294

756,300-107,910

11,622,477

12,744,377

12,747,612

6,854,248

9,537,291

9,384,287

10,517,049

420,681(1,430)(1,683)(1,656)(1,725)(69)

6,854,248

9,248,282

9,384,287

10,517,049

420,681(1,430)(1,632)(1,656)(1,725)(69)-

289,008

-

-

-

(-)

(51)

(-)

(-)

(-)

-

85,002

-

-

-

(-)

(15)

(-)

(-)

(-)

-

204,006

-

-

-

(-)

(36)

(-)

(-)

(-)

- 22 -

5

Future operational policy and issues to be addressed
Outlook for the Fiscal Periods Ending December 31, 2020
From the next fiscal period onward, the Japanese economy is expected to start to recover from an extremely severe situation,
supported by the effectiveness of various policies such as Go To Travel campaign, while taking measures to prevent the
spread of COVID-19 and gradually raising the level of economic activity. However, since June 2020, the spread of COVID19 seems to be again expanding domestically and internationally, and severe conditions are expected to continue. There isalso a risk that the overall economy will deteriorate, such as a further rise in the unemployment rate. Therefore, it isnecessary to closely monitor the impacts of COVID-19 infections in Japan and overseas, variables in the financial and capital
markets, and other factors.
The worldwide spread of COVID-19 has had a significant impact on hotel revenues. At this point in time, it remains
difficult to predict the spread of COVID-19 and its impact on the hotel industry and operators. Therefore, the forecast of
DPU for the December 2020 fiscal period remains undetermined.
(a)Future operational policy and issues to be addressed

Since July 2011, INV has enhanced unitholder value by significantly increasing DPU and financial stability with the FortressGroup as its sponsor. Since Fortress Group joined under the umbrella of SoftBank Group in December 2017 and SoftBank
Group owns 100% of issued shares of the Asset Manager directly and indirectly as of March 29, 2018, in addition tocontinued access to Fortress’ global real estate expertise, INV will seek to leverage the resources that are expected to become
available through SoftBank Group. SoftBank Group has market-leading expertise in technology fields such as digitalmarketing for both mobile and desktop, online payment systems, search engine optimization, AI and robotics. INV believes
that deployment of technology into INV’s real estate assets, especially its hotels, will enhance ongoing initiatives to improveits digital marketing, minimize labor costs and increase customer engagement. For example, INV plans to pursue
opportunities to better manage the increased number of foreign visitors and their related online research, bookings andpayments, the process in setting hotel rates and overbooking through the use of sophisticated AI algorithms, and reduce laborcosts while enhancing customer service through the use of robotics.
In addition to pursuing synergies with SoftBank Group, INV will pay attention to safety-oriented asset management insituations where accommodation demand has declined drastically due to the impact of COVID-19, and focus on reviewing
the operational strategy to restore revenues from hotels. Going forward, INV will continue to implement various strategies
for further growth and financial stability, including the following measures.
Asset recycling: property acquisitions using the proceeds from salesInternal growth at hotels through reducing costs, stimulating existing demand and creating new demand bycollaborating with hotel operators

Further internal growth at residential properties

Diversification of funding sources and lengthening the average maturity period of its debt through borrowings
and the issuance of investment corporation bonds

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

External growth strategy
New Property Acquisitions

As its basic strategy, INV had moved forward with the acquisition of new properties focusing on hotels, where continued
growth in portfolio revenues would be anticipated and residential properties, especially where rental growth could beachieved, to build a portfolio with a good balance between growth and stability. However, for the time being, it is necessary
to carefully consider the acquisition of hotel properties, which have been greatly affected by the sluggish demand foraccommodation due to COVID-19, while looking for the possibility of acquiring at an attractive price.
In regard to hotels, INV will take into consideration demands of business and leisure customers in nearby areas, and leasing
contract types when making investment decisions, with the aim of acquiring properties where growth and stability of GOP- 23 -

and rental revenue are forecasted to increase.
In regard to residential properties, INV will analyze occupancy rates, rental market trends, the presence of competing
properties among other factors, and consider acquiring properties that have mainly small-type rooms with strong
competitiveness in large cities, in which it believes it can achieve increases in rent.
Property Sales
While INV keeps in mind safety-oriented asset management in the sluggish accommodation demand due to the impact of
COVID-19, it also considers the possibility of portfolio optimization upon consideration of the portfolio sector composition,
geographic distribution and competitiveness of each property, as appropriate.
(ii) Strategy for internal growth(Hotels)
Of the 84 domestic hotels (Note 1) owned by INV as of the end of the Reporting Period, 75 hotels use a variable rent scheme.
In the variable rent scheme, in principle, INV receives all of gross operating profit (GOP) after deducting payment ofmanagement fees for the hotel operator as rents. For 73 hotels of the 75 hotels, MHM and subsidiaries of MHM have
implemented sophisticated revenue management initiatives seeking to maximize revenue through effectively taking in theaccommodation demand. As a result, INV can directly enjoy the hotel revenue upside through this variable rent scheme.
In response to the significant reduction in hotel demand, MHM is taking steps to reduce hotel operating expenses byreviewing its operational strategy. Specific measures include temporary hotel closures and the suspension of non-essential
capital expenditures as well as taking government subsidies, cutting payments to service providers such as cleaning vendors,
significantly reducing marketing expenses, utilities and other items under the COVID-19 environment. MHM is vigorously
working to stimulate demand from existing domestic customers by following up on cancelled or postponed functions andproviding corporate customers with various options including new lineup of meeting options highlighting strict measures toreduce the spread of COVID-19. In addition, MHM is focusing on creating new demand, including the provision of dayuse telework environments to provide individuals and corporates with a comfortable telework space as well as
accommodation demand associated with the 14-day voluntary quarantine period after returning to Japan.
For hotels, renovation of rooms and replacement of fixtures and fittings are indispensable to maintain and increase revenues
and operate stably in a planned manner while considering the hotel profit situation, where demand has dropped significantly
as described above.

(Residential properties and others)
INV will continue to strengthen its collaborative ties with property managers and brokers to further boost occupancy rates
and earning capabilities of its properties. With respect to INV’s residential properties, INV will focus on increasing theoccupancy rates and rents for both new lease contracts and lease renewals for all of its properties as well as formulating net
leasing cost reduction policies in order to continue maximizing profits.
Further, the implementation of appropriate maintenance and repair plans is of the utmost importance in maintaining andenhancing the competitiveness and market value of the properties as well as ensuring high tenant satisfaction. Therefore,
INV will continue to monitor current strategic plans with flexible implementation as it sees fit.
(Note 1)

Including Sheraton Grande Tokyo Bay Hotel (the preferred equity interest).

(iii) Financial strategy
The credit rating from Japan Credit Rating Agency, Ltd. (JCR) has been “A+” as long-term issuer rating (Outlook: Stable)
as of the date of this document. As it is difficult to expect when the outbreak of COVID-19 will come to an end, in the
short term INV will implement initiatives that restrict an increase in interest payments on refinancing of existing borrowingsand ensure refinancing. Over the medium to long term, INV will implement financial strategies such as reduction of- 24 -

borrowing costs, extension of average interest-bearing debt repayment period, diversification of loan maturity dates andfinancing measures.

(iv) Compliance risk management
While the executive officer of INV concurrently serves as the representative director at the Asset Manager, two supervisory
directors (an attorney and a certified public account) oversee the execution of the executive officer’s duties via the Board of
Directors of INV. In addition, the compliance officer of the Asset Manager attends each meeting of the Board of Directors
in the capacity of an observer.
The Asset Manager has a compliance officer who is responsible for compliance with laws, regulations and other relevant
matters as well as overall management of transactions with sponsor related parties. Moreover, it has in place a compliancecommittee which, chaired by such compliance officer, is in charge of deliberating on compliance with laws, regulations andother relevant matters as well as transactions with sponsor related parties. Compliance committee meetings are attended
by an outside expert (an attorney) who, sitting in as a compliance committee member, conducts rigorous deliberations on theexistence of conflicts of interest in transactions with sponsor related parties as well as strict examinations with respect to
INV’s compliance with laws and regulations.
INV intends to continually take steps to strengthen its compliance structure.

- 25 -

6

Significant Subsequent Events
Not applicable. Reference Information is described as follows.

(Reference Information)(a)Debt Financing

INV decided to borrow New Syndicate Loan (R) on July 14, 2020 in order to repay New Syndicate Loan (E) in the amountof JPY 28,979 million due on July 16, 2020.
INV decided to borrow Term Loan (N) and Term Loan (O) on July 16, 2020 in order to repay Term Loan (E) in the amountof JPY 1,600 million due on July 20, 2020.
(i)

New Syndicate Loan (R)LenderBorrowing
Date

Outstanding
Balance(JPY million)

Interest Rate(annual rate)

Maturity
Date

Borrowing
MethodJuly 16,2020

28,979Floating
interest rates(Note 1)

July 16,
2021

Unsecured/ nonguarantee

Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Shinsei Bank, Limited
Citibank, N.A., Tokyo Branch
Sumitomo Mitsui Trust Bank, Limited
Resona Bank, Limited.
(Note 1)

1-month JPY TIBOR (Base Rate) + spread (0.25000%)(ii) Term Loan (N)Lender

The Tokyo Star Bank, Limited(Note 1)

Borrowing
Date

Outstanding
Balance(JPY million)

Interest Rate(annual rate)

Maturity
Date

Borrowing
MethodJuly 20,
2020

600

Floating
interest rates(Note 1)

July 20,2022

Unsecured/ nonguarantee

Borrowing
Date

Outstanding
Balance(JPY million)

Interest Rate(annual rate)

Maturity
Date

Borrowing
MethodJuly 20,
2020

1,000

Floating
interest rates(Note 1)

July 20,
2021

Unsecured/ nonguarantee

1-month JPY TIBOR (Base Rate) + spread (0.25000%)(iii) Term Loan (O)LenderDevelopment Bank of Japan Inc.
(Note 1)

1-month JPY TIBOR (Base Rate) + spread (0.25000%)- 26 -

Overview of the Investment Corporation
1

Overview of Investment
By Period
Results Dates

30th fiscal
periodAs of Jun. 30,
2018

31st fiscal
periodAs of Dec. 31,
2018

32nd fiscal
periodAs of Jun. 30,
201933rd fiscal
periodAs of Dec. 31,
201934th fiscal
periodAs of Jun. 30,
2020

10,000,000

10,000,000

10,000,000

10,000,000

10,000,000

4,793,181

5,666,840

5,666,840

6,096,840

6,096,840

168,798

211,092

211,092

235,701

235,701

27,96035,22832,64534,62642,439Number of issuable
investment units(Unit)
Number ofinvestment units
issued andoutstanding(Unit)
Unitholders’ capital(JPY million)
Number of total
unitholders
2

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

Name

Number of units held

% of total number of investment
units issued and outstanding

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

976,811

16.02

Japan Trustee Services Bank, Ltd.
(Note 1)

599,611

9.83

STICHTING PGGM DEPOSITARY PGGM
LISTED REAL ESTATE PF FUND

335,715

5.50

The Nomura Trust and Banking Co., Ltd.
(investment trust account)

309,590

5.07

Trust & Custody Services Bank, Ltd. (securities
investment trust account) (Note 1)

224,619

3.68

GCAS BANA LONDON US CLIENT

123,245

2.02

THE BANK OF NEW YORK MELLON 140044

106,004

1.73

NORTHERN TRUST CO. (AVFC) RE
MONDRIAN INTERNATIONAL SMALL CAPEQUITY FUND, L.P.

92,379

1.51

STATE STREET BANK AND TRUST COMPANY
51031289,431

1.46

JP MORGAN CHASE BANK 380055

84,1481.38

2,941,553

48.24(trust account)

Total(Note 1)

(Note 2)

Japan Trustee Services Bank, Ltd. and Trust & Custody Services Bank, Ltd. conducted an absorption-type merger
with JTC Holdings, Ltd., the parent company of the two companies, on July 27, 2020 after the end of theReporting Period, in which Japan Trustee Services Bank, Ltd. was the surviving company. The trade name after
the merger is “Custody Bank of Japan, Ltd.”
Percentages are rounded down to two decimal places.

- 27 -

3

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

Position

Executive Director

Name

Naoki Fukuda

Yoshihiro Tamura
Supervisory Director
Hiroyuki Fujimoto

Auditor(Note)

Concurrent responsibilities
President and CEO,
Consonant Investment
Management Co., Ltd.
(current position)
Attorney,
Shiba-Daimon Law Office
Statutory Auditor,
BEQONE PARTNERS, Inc.
(current position)
Certified Public Accountant,
CPA Fujimoto OfficeOutside Auditor,
BRYCEN Co., Ltd.
(current position)

Ernst & Young
ShinNihon LLC-

Directors’ remunerationfor operating period(JPY thousand)
-

2,400

2,400

19,400Executive and supervisory directors do not hold INV’s units either in their names or in the names of third parties.
In addition, while they may be directors of organizations not listed above, those organizations as well as thoselisted above have no conflicts of interest with INV.

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

- 28 -

4

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

Delegation category
Asset management company
Asset custody company
General administrative agent (institutional operations(Note 1) administration of unitholders’ registry, etc.)
General administrative agent(institutional operations (Note 2))
General administrative agent(accounting operations, etc.)
Special account management company
General administrative agent(Fiscal agent pertaining to investment corporation
bonds, etc.)(Note 1)
(Note 2)

(Note 3)(Note 4)

Name
Consonant Investment Management Co., Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Trust Bank, Limited
Consonant Investment Management Co., Ltd.
Sumitomo Mitsui Trust Bank, Limited
Mitsubishi UFJ Trust and Banking Corporation
Limited (Note 3) / Sumitomo Mitsui Trust
Bank, Limited (Note 4)
Mizuho Bank, Ltd. / Sumitomo Mitsui
Banking Corporation

Of the administrative tasks for the INV’s institutional operations, tasks related to the mailing of generalunitholders’ meetings and the receipt and counting of voting forms are delegated.
(i) Tasks related to the running of general unitholders’ meetings for INV (excluding tasks related to the mailingof general unitholders’ meetings and the receipt and counting of voting forms), (ii) tasks related to the runningof the meetings of the Board of Directors of INV, and (iii) or tasks incidental or related to that mentioned in (i)or (ii) are delegated.
Conducts administrative tasks related to the creation, maintenance, and disposition of transfer savings accountregisters for special accounts of unitholders of the INV before the merger (former Tokyo Growth REIT
Investment Inc.) as well as tasks related to other transfer savings account registers.
Conducts administrative tasks related to the creation, maintenance, and disposition of transfer savings accountregisters for special accounts of unitholders of the former LCP as well as tasks related to other transfer savings
account registers.

- 29 -

Status of Investment Corporation’s Assets under Management
1

Composition of INV’s Assets

Type ofasset

Geographic area

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

Fiscal period ended December 31, 2019(as of December 31, 2019)
Amount held
(JPY million)(Note 2)

Percentage of
total assets(%)

Fiscal period ended June 30, 2020(as of June 30, 2020)
Amount held
(JPY million)(Note 2)

Percentage of
total assets
(%)

3

0.0

2

0.0

-

-

-

-

35,442

6.8

35,5276.9

35,445

6.8

35,5306.9

35,445

6.8

35,530

6.9

Greater Tokyo area
Major regional
citiesSubtotal

38,366

7.3

35,8806.9

15,186

2.9

15,023

2.9

53,552

10.3

50,904

9.9

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

-

-

-

-

4,789

0.9

4,738

0.9

Total real estate

Residences

4,789

0.9

4,738

0.9

161,20230.9

171,17033.1

210,59240.3

214,91241.6

371,79471.2

386,082

74.7

Total real estate in trust

430,13782.3

441,725

85.5

Preferred equity interest (Note 5)

17,856

3.4

17,856

3.5

Deposits and other assets

38,992

7.5

21,5504.2

522,431100.0

516,663100.0(465,583)(89.1)(477,256)(92.4)

HotelsGreater Tokyo area
Major regional
citiesSubtotal

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

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

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

- 30 -

2

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

Name of property

D200

Westin Grand Cayman Seven Mile Beach
Resort & Spa

Book value(JPY million)

Leasable area(m2)
(Note 2)

Leased area(m2)

Occupancy rate

Ratio of(%)

rental revenue(Note 3)(%) (Note 4)Main use

29,777

21,528.23

21,528.23

100.0

-

Hotel

D43

Hotel MyStays Gotanda Station

26,351

10,137.88

10,137.88

100.0

2.5

Hotel

D60

Hotel MyStays Premier Akasaka

20,4788,620.69

8,620.69

100.0

1.8

Hotel

D44

Hotel Epinard Nasu

19,52137,702.33

37,702.33

100.0

1.9

Hotel

D61

Hotel MyStays Premier Sapporo Park

16,371

21,670.64

21,670.64

100.0

1.3

Hotel

D64

Hotel MyStays Sapporo Aspen

15,455

15,313.17

15,313.17

100.0

1.7

Hotel

12,921

13,026.99

13,026.99

100.0

1.0

Hotel

D50

Hotel MyStays Shin Osaka ConferenceCenterD47

Hotel MyStays Premier Kanazawa

12,912

13,250.03

13,250.03

100.0

1.4

Hotel

D82

Hotel MyStays Premier Narita

10,521

36,519.70

36,519.70

100.0

4.0

Hotel

D51

Hotel MyStays Premier Omori

9,768

11,849.61

11,849.61

100.0

0.9

Hotel

174,080

189,619.27

189,619.27

100.0

16.6

Total

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

Securities described in “6Asset Portfolio of Securities” later in this document are excluded.
Leasable area of Westin Grand Cayman Seven Mile Beach Resort & Spa indicates the area subject to management
contract.
“Occupancy rate” is calculated by dividing the leased area by leasable area, and rounded to one decimal place.
“Ratio of rental revenue” are rounded to one decimal place. For Westin Grand Cayman Seven Mile Beach
Resort & Spa, management contract revenue of JPY 769,453 thousand is recorded, but not included in thecalculation of ratio of rental revenue.

- 31 -

3

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

Name of property

Location(Note 1)

A26

Nisshin Palacestage
Daitabashi

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

A27

Nisshin Palacestage HigashiNagasaki

5-4-1 Nagasaki, Toshima-ku, Tokyo

A28

Growth Maison Gotanda

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

A29

Growth Maison Kameido

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

A30

Emerald House

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

A32

Suncrest Shakujii-Koen

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

A33

Growth Maison ShinYokohama

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

A34

Belle Face UenoOkachimachi

1-27-5 Higashi-Ueno, Taito-ku, Tokyo

A35

Grand Rire Kameido

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

A37

Growth Maison Yoga

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

A38

Route Tachikawa

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

A39

Shibuya-Honmachi Mansion

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

A40

City Heights Kinuta

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

A41

Acseeds Tower
Kawaguchi- Namiki

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

A43

College Square Machida

3-4-4 Nakamachi, Machida-shi, Tokyo- 32 -

Appraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
1,771.13
1,230
1,093
interest(Note 4)Trust
beneficiary
2,681.94
1,360
1,046
interest(Note 4)Trust
beneficiary
1,051.50
1,030
835
interest
Trust
beneficiary
1,367.96
1,160
949
interest
Trust
beneficiary
2,152.31
1,430
1,322
interest
Trust
beneficiary
3,029.16
1,110
1,055
interest(Note 4)Trust
beneficiary
1,858.44
1,180
932
interest(Note 4)Trust
beneficiary
1,351.11
1,090
921
interest(Note 4)Trust
beneficiary
1,562.26
1,010
792
interest(Note 4)Trust
beneficiary
1,015.34
784
724
interest(Note 4)Trust
beneficiary
1,368.57
674
635
interest
Trust
beneficiary
1,167.50
668
699
interest(Note 4)Trust
beneficiary
1,235.93557
649
interest
Trust
beneficiary
1,210.74
769
517
interest(Note 4)Trust
beneficiary
1,047.75
507
559
interest(Note 4)

Name of property

A44

Belair Meguro

A45

Wacore Tsunashima I

A46

Foros Nakamurabashi

A47

Growth Maison Kaijin

A48

College Square Machiya

A53

Nishiwaseda Cresent
Mansion

A54

Lexington Square
Akebonobashi

A59

Towa City Coop
Shinotsuka II

A61Bichsel Musashiseki

A63

Towa City Coop Sengencho

A64

Royal Park Omachi

A65

Lexington Square
Haginomachi

A66

Visconti Kakuozan

A71

Lexington Square Daitabashi

A72

Lexington Square
Honjo Azumabashi

A73

AMS TOWER Minami 6-Jo

A76

Neo Prominence

A77

Invoice Shin-Kobe
Residence

A78

Cosmo Court Motomachi

Appraisal value
as of December
31, 2019June 30,
Book value
Location
Leasable area 2020the end ofType of asset(JPY(Note 1)(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
1-2-15 Meguro, Meguro-ku, Tokyo
557.05631
547
interest(Note 4)Trust
2-7-47 Tarumachi, Kohoku-ku,
beneficiary
907.46
527
518
Yokohama-shi, Kanagawa
interest(Note 4)Trust
beneficiary
1-6-6 Kouyama, Nerima-ku, Tokyo
815.77587
501
interest(Note 4)Trust
beneficiary
5-29-51 Kaijin, Funabashi-shi, Chiba
2,040.27
519
506
interest(Note 4)Trust
beneficiary
7-3-1 Arakawa, Arakawa-ku, Tokyo
871.35567
437
interest(Note 4)Trust
3-18-9 Nishi-Waseda, Shinjuku-ku,
beneficiary
4,310.77
2,810
1,882
Tokyo
interest
Trust
3-8 Yochomachi, Shinjuku-ku, Tokyo
beneficiary
1,987.88
1,990
1,287
interest
Trust
5-49-7 Higashi-Ikebukuro, Toshima-ku,
beneficiary
1,627.13
1,250
801
Tokyo
interest
Trust
1-22-7 Sekimachi-Kita, Nerima-ku,
beneficiary
1,220.24
828
563
Tokyo
interest
Trust
4-338-2 Sengencho, Nishi-ku,
beneficiary
3,426.36
1,440
1,008
Yokohama-shi, Kanagawa
interest
Trust
2-11-10 Omachi, Aoba-ku, Sendai-shi,
beneficiary
1,929.59
675
382
Miyagiinterest
Trust
1-15-16 Haginomachi, Miyagino-ku,
beneficiary
1,528.58
417
270
Sendai-shi, Miyagi
interest
Trust
2-44 Otanacho, Chikusa-ku, Nagoyabeneficiary705.75286
229
shi, Aichi
interest
Trust
1-33-18 Izumi, Suginami-ku, Tokyo
beneficiary
1,430.64
1,260
820
interest
Trust
4-20-6 Higashi-Komagata, Sumida-ku,
beneficiary784.74
653
419
Tokyo
interest
Trust
2-5-15 Minami 6-Jo Nishi, Chuo-ku,
beneficiary
4,460.56
1,250
899
Sapporo-shi, Hokkaido
interest
Trust
3-21-5 Shimo, Kita-ku, Tokyo
beneficiary
3,574.70
2,270
1,588
interest
Trust
3-3-8 Ikutacho, Chuo-ku, Kobe-shi,
beneficiary
2,773.71
1,470
1,123
Hyogo
interest
Trust
3-12-20 Motomachidori, Chuo-ku,
beneficiary
2,310.49
1,140
856
Kobe-shi, Hyogo
interest- 33 -Name of property

Location(Note 1)

A79

Revest Honjin

2-13 Toriidori, Nakamura-ku, Nagoyashi, Aichi

A80

Revest Matsubara

3-13-12 Matsubara, Naka-ku, Nagoyashi, Aichi

A82

Alba Noritake Shinmachi

3-6-8 Noritake Shinmachi, Nishi-ku,
Nagoya-shi, Aichi

A83

Revest Meieki Minami

2-13-33 Meieki-Minami, Nakamuraku, Nagoya-shi, Aichi

A84

Revest Heian

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

A85

Vendir Hamaotsu Ekimae

1-2-15 Hamaotsu, Otsu-shi, Shiga

A86

Salvo Sala

2-6-21 Shimanouchi, Chuo-ku, Osakashi, Osaka

A87

Excellente Kagurazaka

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

A88

Luna Court Edobori

3-4-11 Edobori, Nishi-ku, Osaka-shi,
Osaka

A89

Winntage Kobe Motomachi

7-2-2 Motomachidori, Chuo-ku, Kobeshi, Hyogo

A90

Queen's Court Fukuzumi

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

A91

Corp Higashinotoin

380-1 Kawaranomachi,
Higashinotoindori Nijo Kudaru,
Nakagyo-ku, Kyoto-shi, Kyoto, andother two parcels

A92

Belair Oimachi

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

A93

Siete Minami-Tsukaguchi

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

A94

Prime Life Sannomiya
Isogami Koen

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

A95

HERMITAGE NANBA
WEST

4-10-3 Sakuragawa, Naniwa-ku,
Osaka-shi, Osaka

A96

Century Park Shinkawa 1bankan

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

A97

West Avenue

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

A98

Little River Honmachibashi

1-34 Honmachibashi, Chuo-ku, Osakashi, Osaka

A99

Prime Life Mikage

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

A100

City Court Kitaichijo

1-6-3 Kita 1-jo Higashi, Chuo-ku,
Sapporo-shi, Hokkaido- 34 -

Appraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
1,933.80
843
587
interest
Trust
beneficiary
1,955.40
841
576
interest
Trust
beneficiary
1,731.68
775
528
interest
Trust
beneficiary
1,634.60
810
518
interest
Trust
beneficiary
1,554.03
746
520
interest
Trust
beneficiary
2,670.66
795
497
interest
Trust
beneficiary
1,428.12677
480interest
Trust
beneficiary701.92
696
494
interest
Trust
beneficiary
1,185.50
606
466
interest
Trust
beneficiary
1,433.35
639
447
interest
Trust
beneficiary765.18686
421
interest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

1,029.05

541

400

530.60569

383

1,020.86

464

340

789.12477

334

992.76467

316

1,477.62

466

309

794.80341

308

974.81415

279

761.18345

266

5,230.18

2,160

1,690

Name of property

Location(Note 1)

A101

Lieto Court Mukojima

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

A102

Lieto Court Nishi-Ojima

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

A103

Royal Parks Momozaka

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

A104

Royal Parks Shinden

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

A106

Royal Parks Seasir MinamiSenju

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

Appraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
2,940.20
2,000
1,642
interest
Trust
beneficiary
2,048.28
1,960
1,590
interest
Trust
beneficiary
8,776.26
3,230
2,699
interest
Trust
beneficiary
15,797.29
5,840
4,797
interest
Trust
beneficiary
6,496.86
2,920
2,627
interest

Subtotal
B17

Lexington Plaza Hachiman

3-1-50 Hachiman, Aoba-ku, Sendaishi, Miyagi

B18

AEON TOWN Sukagawa

105 Furukawa, Sukagawa-shi,
Fukushima

Trust
beneficiaryinterest
Trust
beneficiaryinterest

Subtotal
D01

Hotel MyStays Kanda

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

D02

Hotel MyStays Asakusa

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

D03

Hotel MyStays Kyoto-Shijo

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

D04

MyStays Shin-Urayasu
Conference Center

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

D05

Hotel MyStays Maihama

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

D06

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

D07

Hotel MyStays NagoyaSakae

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

D08

Hotel MyStays SakaisujiHonmachi

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

D09

Hotel MyStays Yokohama

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

D10

Hotel MyStays Nippori

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

D11

Hotel MyStays FukuokaTenjin-Minami

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

D12

Flexstay Inn Iidabashi

3-26 Shin-Ogawamachi, Shinjuku-ku,Tokyo- 35 -

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

127,788.79

65,43850,904

8,419.15

3,670

3,000

18,440.58

2,450

1,737

26,859.73

6,120

4,738

2,585.72

4,920

2,921

3,327.38

4,410

2,515

7,241.51

10,5005,770

6,232.30

7,200

4,584

2,456.36

6,770

4,699

9,445.32

6,810

3,699

9,064.71

5,530

2,596

4,188.83

4,220

2,340

7,379.43

3,890

2,300

1,719.29

2,510

1,789

3,412.71

5,570

1,458

2,953.38

2,130

1,341

Name of property

Location(Note 1)

D13

Hotel MyStays
Ueno Inaricho

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

D14

Flexstay Inn Shinagawa

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

D15

Flexstay Inn Tokiwadai

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

D16

Flexstay Inn Sugamo

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

D17

Hotel MyStays Otemae

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

D18

Hotel MyStays
Kiyosumi Shirakawa

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

D19

Flexstay Inn Nakanobu P1

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

D20

Flexstay Inn Nakanobu P2

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

APA Hotel
Yokohama-Kannai

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

D22

Hotel MyStays
Hakodate-Goryokaku

26-17 Honcho, Hakodate-shi,
Hokkaido

D23

Flexstay Inn Shirogane

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

D24

Hotel MyStays Haneda

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

D25

Hotel MyStays Kameido P1

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

D26

Hotel MyStays Ueno
Iriyaguchi

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

D27

Hotel MyStays Kameido P2

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

D28

Hotel MyStays Shimizu

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

D29

Super Hotel Shinbashi/
Karasumoriguchi

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

D30

Flexstay Inn Higashi-Jujo

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

D31

Hotel MyStays Utsunomiya

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

D32

Flexstay Inn KawasakiKaizuka

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

D33

Comfort Hotel Toyama

1-3-2 Takara-machi, Toyama-shi,Toyama- 36 -

Appraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
1,150.76
2,010
1,231
interest
Trust
beneficiary
1,134.52
1,980
1,193
interest
Trust
beneficiary
2,539.75
2,140
1,197
interest
Trust
beneficiary
2,089.86
2,260
1,108
interest
Trust
beneficiary
4,956.66
2,920
1,133
interest
Trust
beneficiary
2,673.64
1,500
888
interest
Trust
beneficiary
770.56803
561
interest
Trust
beneficiary
391.49387
284
interest
Trust
beneficiary
6,568.51
9,930
7,607
interest
Trust
beneficiary
7,961.26
3,900
2,772
interest
Trust
beneficiary
1,754.06
2,360
2,083
interest
Trust
beneficiary
5,400.16
8,590
7,243
interest
Trust
beneficiary
4,349.67
7,370
5,346
interest
Trust
beneficiary
2,247.92
3,760
3,666
interest
Trust
beneficiary
2,793.99
4,930
3,558
interest
Trust
beneficiary
3,559.81
2,380
2,115
interest
Trust
beneficiary
1,403.89
1,940
1,585
interest
Trust
beneficiary
1,714.53
1,300
1,269
interest
Trust
beneficiary
11,733.23
2,000
1,213
interest
Trust
beneficiary
1,190.57
1,110
901
interest
Trust
beneficiary
3,305.64
1,160
910
interestName of property

Location(Note 1)

D34

Flexstay Inn KawasakiOgawacho

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

D35

Flexstay Inn Ekoda

8-6 Sakaecho, Nerima-ku, Tokyo

D36

Super Hotel Tokyo-JR
Tachikawa Kitaguchi

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

D37

Super Hotel JR Uenoiriyaguchi

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

D38

Hotel MyStays Shinsaibashi

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

D39

Comfort Hotel Kurosaki

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

D40

Comfort Hotel Maebashi

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

D41

Comfort Hotel TsubameSanjo

2-115 Sugoro, Sanjo-shi, Niigata

D42

Comfort Hotel Kitami

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

D43

Hotel MyStays Gotanda
Station (Note 5)

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

D44

Hotel Epinard Nasu

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

D45

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

D46

Hotel MyStays
Hamamatsucho

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

D47

Hotel MyStays PremierKanazawa

2-13-1 Hirooka, Kanazawa-shi,Ishikawa

D48

Takamatsu Tokyu REI Hotel

9-9 Hyogomachi, Takamatsu-shi,
KagawaD49

Hotel MyStays Premier
Hamamatsucho

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

D50

Hotel MyStays Shin Osaka
Conference Center

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

D51

Hotel MyStays PremierOmori

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

D52

Beppu Kamenoi Hotel

2160-1 Chuocho, Beppu-shi, Oita and12 other lots

D53

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

D54

Hotel MyStays Yokohama
Kannai

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

- 37 -

Appraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary725.60890
877interest
Trust
beneficiary
3,932.93
4,580
4,830
interest
Trust
beneficiary
1,832.97
1,260
1,097
interest
Trust
beneficiary
1,279.16
1,210
1,077
interest
Trust
beneficiary
1,942.01
2,720
3,025
interest
Trust
beneficiary
3,207.60
1,250
1,051
interest
Trust
beneficiary
3,660.96
1,160
1,019
interest
Trust
beneficiary
3,099.90
1,100
937
interest
Trust
beneficiary
3,009.50926
782
interest
Trust
beneficiary
10,137.88
23,90026,351interest
Trust
beneficiary
37,702.33
22,90019,521interest
Trust
beneficiary
5,083.06
8,110
7,875
interest
Trust
beneficiary
1,951.90
6,220
7,910
interest
Trust
beneficiary
13,250.03
12,80012,912interest
Trust
beneficiary
7,148.17
2,260
2,119
interest
Trust
beneficiary
6,151.93
10,300
7,982
interest
Trust
beneficiary
13,026.99
12,80012,921interest
Trust
beneficiary
11,849.61
9,620
9,768
interest
Trust
beneficiary
19,422.08
8,670
8,143
interest
Trust
beneficiary
7,267.88
8,180
7,749
interest
Trust
beneficiary
4,501.18
5,250
5,204
interestName of property

D55

Art Hotel Joetsu

D56

Art Hotel Hirosaki City

D57

Hotel MyStays Oita

D58

Hotel MyStays Gotanda

D59

Hotel MyStays Tachikawa

D60

Hotel MyStays Premier
Akasaka

D61

Hotel MyStays Premier
Sapporo Park

D62

Hotel MyStays Ueno East

D63

Hotel MyStays Midosuji
Honmachi

D64

Hotel MyStays
Aspen

D65

Art Hotel Ishigakijima

D66

Hotel MyStays Fuji Onsen
ResortD67

Hotel Sonia Otaru

D68

Hotel MyStays Kanazawa
CastleD69

Art Hotel Niigata Station

D70

Hotel MyStays
Nishiki

D71

Hotel Nord Otaru

D72

Hotel MyStays Kagoshima
Tenmonkan

D73

Art Hotel Asahikawa

D74

Hotel MyStays Matsuyama

D75

Hotel MyStays
Susukino

SapporoNagoyaSapporoAppraisal value
as of December
31, 2019June 30,
Book value
Location
Leasable area 2020the end ofType of asset(JPY(Note 1)(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
5-1-11, Hon-cho Joetsu-shi, Niigata
beneficiary
7,563.60
2,690
2,695
interest
Trust
1-1-2, 1-6, 1-7, 2-1, Omachi, Hirosakibeneficiary
14,826.30
2,660
2,607
shi, Aomori
interest
Trust
1-32, Niagemachi Oita-shi, Oita
beneficiary
3,254.69
1,560
1,529
interest
Trust
2-5-4, Higashigotanda Shinagawa-ku,
beneficiary
1,839.77
3,920
4,061
Tokyo
interest
Trust
1-8-14, Nishiki-cho Tachikawa-shi,
beneficiary
3,844.64
3,330
3,217
Tokyo
interest
Trust
2-17-54, Akasaka Minato-ku, Tokyo
beneficiary
8,620.69
23,20020,478interest
Trust
2-2-10, Minamikujo Nishi, Chuo-ku,
beneficiary
21,670.64
16,20016,371
Sapporo-shi, Hokkaido
interest
Trust
5-5-6, Higashi Ueno, Taito-ku, Tokyo
beneficiary
4,396.02
5,110
5,213
interest
Trust
3-2-10, Honmachi, Chuo-ku, Osakabeneficiary
3,429.43
4,130
4,934
shi, Osakainterest
5-1 Nishi 4-chome, Kita 8-jo, Kita-ku,
Trust
Sapporo-shi, Hokkaido, and sevenbeneficiary
15,313.17
14,90015,455other lots
interest
Trust
554-2 Nishimaji Okawa, Ishigaki‐shi,
beneficiary
17,247.54
9,290
9,656
Okinawa, and four other lots
interest
Trust2654 Arakura Deguchi, Fujiyoshidabeneficiary
5,498.49
9,750
9,215
shi, Yamanashi, and 15 other lots
interest
Trust
1-4-20 Ironai, Otaru-shi, Hokkaido
beneficiary
6,509.41
5,640
5,825
interest
Trust
10-17 Konohana-machi, Kanazawabeneficiary
5,931.84
5,410
5,663
shi, Ishikawa
interest
Trust
1-1 Sasaguchi, Chuo-ku, Niigata-shi,
beneficiary
10,403.01
5,330
5,543
Niigatainterest
Trust
3-8-21 Nishiki, Naka-ku, Nagoya-shi,
beneficiary
6,077.99
5,110
5,162
Aichi
interest
Trust
1-4-16 Ironai, Otaru-shi, Hokkaido
beneficiary
6,047.43
4,090
4,246
interest
Trust
2-7 Yamanokuchi-cho, Kagoshima-shi,
beneficiary
7,659.55
3,420
3,413
Kagoshimainterest
Trust
6-29-2 7-jo-dori, Asahikawa-shi,
beneficiary
25,131.84
3,050
3,103
Hokkaido
interest
Trust
1-10-10 Otemachi, Matsuyama-shi,
beneficiary
8,274.37
3,170
3,021
Ehime
interest
1-6 Nishi 5-Chome, Minami 7-jo,
Trust
Chuo-ku, Sapporo-shi, Hokkaido, andbeneficiary
2,853.26
2,970
3,038
one other lot
interest- 38 -

Location(Note 1)Name of property

D76

Hotel MyStays
Nakajima Park

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

D77

Hotel MyStays Sapporo
Nakajima Park Annex

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

D78

Flexstay Inn Sakuragicho

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

D79

MyCUBE by MYSTAYS
Asakusa Kuramae

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

D80

Hotel MyStays Kagoshima
Tenmonkan Annex

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

D81

Hotel MyStays Nayoro

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

D82

Hotel
Narita40 Yokomine Oyama, Narita-shi,
Chiba, and 14 other lots

D83

Art Hotel Morioka

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

D200

Westin Grand Cayman
Seven Mile Beach Resort &Spa

30620 Seven Mile Beach Road, Grand
Cayman, Cayman Islands

D201

Sunshine Suites Resort

1465 Esterley Tibbetts Highway,
Grand Cayman, Cayman Islands

MyStaysPremierAppraisal value
as of December
31, 2019June 30,
Book value
Leasable area 2020the end ofType of asset(JPY(m2) (Note 2)
the Reporting
million)
Period(JPY million)(Note 3)Trust
beneficiary
5,473.41
2,060
2,092
interest
Trust
beneficiary
1,775.21
1,520
1,566
interest
Trust
beneficiary
1,308.61
1,450
1,417
interest
Trust
beneficiary
2,156.70
1,280
1,284
interest
Trust
beneficiary
2,047.70
1,190
1,161
interest
Trust
beneficiary
1,985.27
932
936
interest
Trust
beneficiary
36,519.70
10,10010,521interest
Trust
beneficiary
16,727.08
5,400
5,599
interest
31,158The(USD 289,200
21,528.23
29,777
Leaseholdthousand)(Note 6)
5,462
The
(USD 50,700
6,723.11
5,749
Leaseholdthousand)(Note 6)

Subtotal

572,519.79

470,778

421,613

Total

727,168.31

542,336477,256(Note 1) “Location” is, in principle, based on the indicated address (jyukyohyoji), except that if the jyukyohyoji system has not been
implemented for such property, the location is based on the land number (chiban).
(Note 2) Leasable areas of Westin Grand Cayman Seven Mile Beach Resort & Spa and Sunshine Suites Resort indicate the areas
subject to management contract.
(Note 3) “Appraisal value as of the end of the Reporting Period” is the value appraised or researched by Asset Research andDevelopment Inc., Japan Real Estate Institute, JLL Morii Valuation & Advisory K.K., The Tanizawa Sogo Appraisal Co.,
Ltd., Daiwa Real Estate Appraisal Co., Ltd. or CBRE, Inc., in accordance with the Articles of Incorporation of INV and theregulations of The Investment Trusts Association, Japan.
(Note 4) Individual trust beneficiary interests were integrated into three groups with other trust beneficiary interests when INV
procured funds through debt financing backed by trust assets in July 2011. As a result of disposition of assets anddetachment of trust beneficiary interest from an integrated trust account thereafter, the grouping of trust beneficiary interests
at the end of the Reporting Period is as follows:
Group 1
Nisshin Palacestage Daitabashi, Nisshin Palacestage Higashi-Nagasaki, Growth Maison Shin-Yokohama,
Belle Face Ueno-Okachimachi, Growth Maison Yoga, Shibuya-Honmachi Mansion, and Foros Nakamurabashi.
Group 2
College Square Machida, Belair Meguro, and Wacore Tsunashima I.
Group 3
Suncrest Shakujii-Koen, Grand Rire Kameido, Acseeds Tower Kawaguchi-Namiki, Growth Maison Kaijin, and College
Square Machiya.
(Note 5) “Appraisal value as of the end of the Reporting Period” indicates appraisal value calculated deeming the owned portionand the floor expansion portion as one.
(Note 6) “Appraisal value as of the end of the Reporting Period” is converted into JPY using the exchange rate of USD 1 = JPY
107.74, which is the exchange rate on the closing date of the fiscal period (June 30, 2020).

- 39 -

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

Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)

A26

Nisshin Palacestage
Daitabashi

1

96.1

38,157

0.3

1

95.2

40,6120.7

A27

Nisshin Palacestage
Higashi- Nagasaki

1

96.6

46,906

0.3

1

97.1

47,4660.8

A28

Growth Maison Gotanda

1

100.0

27,704

0.2

1

100.0

27,6940.5

A29

Growth Maison Kameido

1

96.9

35,991

0.2

1

97.0

35,652

0.6

A30

Emerald House

1

96.7

42,650

0.3

1

98.9

50,0470.9

A32

Suncrest Shakujii-Koen

1

97.9

38,048

0.3

1

94.9

37,5430.6

A33

Growth Maison ShinYokohama

1

95.6

39,217

0.3

1

92.6

38,1230.7

A34

Belle Face UenoOkachimachi

1

93.9

32,234

0.2

1

96.8

36,452

0.6

A35Grand Rire Kameido

1

100.0

26,663

0.2

1

100.0

26,6190.5

A37Growth Maison Yoga

1

97.5

23,636

0.2

1

89.8

23,185

0.4

A38

Route Tachikawa

1

100.0

22,128

0.2

1

100.0

21,713

0.4

A39

Shibuya-Honmachi Mansion

1

100.0

21,493

0.1

1

95.5

20,9370.4

A40City Heights Kinuta

1

100.0

19,317

0.1

1

83.8

16,7720.3

A41

Acseeds Tower KawaguchiNamiki

1

96.5

25,642

0.2

1

93.0

26,0680.4

A43

College Square Machida

1

100.0

17,484

0.1

1

100.0

17,0460.3

A44

Belair Meguro

1

100.0

17,265

0.1

1

100.0

17,6780.3

A45

Wacore Tsunashima I

1

98.0

18,298

0.1

1

94.1

18,796

0.3

A46

Foros Nakamurabashi

1

91.3

19,065

0.1

1

92.6

18,9870.3

A47

Growth Maison Kaijin

1

96.7

23,224

0.2

1

94.9

22,584

0.4

A48

College Square Machiya

1

100.0

14,924

0.1

1

100.0

14,9240.3

A51City House Tokyo Shinbashi(Note 4)1

100.0

95,654

0.7

-

-

7,118

0.1

A52

Winbell Kagurazaka (Note 5)--

101,713

0.7

-

-

-

-

A53

Nishiwaseda Cresent
Mansion1

100.0

74,752

0.5

1

100.0

75,734

1.3

A54

Lexington Square
Akebonobashi

1

96.6

51,876

0.4

1

95.4

51,7420.9- 40 -Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)

A59

Towa City Coop Shinotsuka
II

1

88.4

36,436

0.3

1

95.2

36,5580.6

A61

Bichsel Musashiseki

1

100.0

24,170

0.2

1

90.0

24,0090.4

A63

Towa City Coop Sengencho

1

88.4

56,089

0.4

1

89.9

57,222

1.0

A64Royal Park Omachi

1

94.4

26,147

0.2

1

89.4

25,5990.4

A65

Lexington Square
Haginomachi

1

84.5

15,465

0.1

1

92.1

16,8780.3

A66

Visconti Kakuozan

1

76.0

8,301

0.1

1

100.0

9,997

0.2

A71

Lexington Square Daitabashi

1

86.6

32,216

0.2

1

93.0

34,137

0.6

A72

Lexington Square Honjo
Azumabashi

1

100.0

19,070

0.1

1

93.9

18,7580.3

A73

AMS TOWER Minami 6-Jo

1

93.9

45,136

0.3

1

86.0

46,3200.8

A76

Neo Prominence

1

98.4

67,520

0.5

1

95.0

68,847

1.2

A77

Invoice Shin-Kobe Residence

1

94.4

49,007

0.3

1

96.3

50,1690.9

A78

Cosmo Court Motomachi

1

98.9

39,050

0.3

1

97.7

38,377

0.7

A79

Revest Honjin

1

91.3

29,790

0.2

1

92.5

30,3300.5

A80

Revest Matsubara

1

82.4

27,760

0.2

1

93.7

28,822

0.5

A82

Alba Noritake Shinmachi

1

91.6

26,394

0.2

1

95.2

26,944

0.5

A83

Revest Meieki Minami

1

90.5

26,535

0.2

1

90.5

26,7050.5

A84

Revest Heian

1

92.0

22,440

0.2

1

93.6

23,8200.4

A85

Vendir Hamaotsu Ekimae

1

93.4

34,043

0.2

1

95.3

34,983

0.6

A86

Salvo Sala

1

83.3

24,137

0.2

1

92.0

24,7170.4

A87

Excellente Kagurazaka

1

100.0

20,118

0.1

1

94.2

20,0150.3

A88

Luna Court Edobori

1

91.9

20,197

0.1

1

96.0

21,2040.4

A89

Winntage Kobe Motomachi

1

96.7

22,405

0.2

1

91.3

22,3990.4

A90

Queen's Court Fukuzumi

1

96.6

17,730

0.1

1

96.6

18,161

0.3

A91

Corp Higashinotoin

1

95.1

18,839

0.1

1

93.3

18,9030.3

A92

Belair Oimachi

1

100.0

15,824

0.1

1

92.6

16,1470.3

A93

Siete Minami-Tsukaguchi

1

100.0

17,712

0.1

1

100.0

17,7460.3

A94

Prime Life Sannomiya
Isogami Koen

1

100.0

15,254

0.1

1

100.0

15,434

0.3- 41 -Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)A95

HERMITAGE NANBA
WEST

1

100.0

16,463

0.1

1

88.0

15,9990.3

A96

Century Park Shinkawa 1bankan

1

90.9

17,059

0.1

1

97.7

18,2770.3

A97West Avenue

1

95.0

12,224

0.1

1

92.5

13,471

0.2

A98

Little River Honmachibashi

1

100.0

14,415

0.1

1

100.0

14,7430.3

A99

Prime Life Mikage

1

100.0

12,411

0.1

1

96.7

12,624

0.2

A100 City Court Kitaichijo

1

95.8

66,770

0.5

1

92.9

66,4691.1

A101 Lieto Court Mukojima

1

99.0

57,225

0.4

1

99.0

56,8991.0

A102 Lieto Court Nishi-Ojima

1

99.0

49,213

0.3

1

97.8

50,076

0.9

A103 Royal Parks Momozaka

1

97.8

162,427

1.1

1

96.0

161,353

2.8

A104 Royal Parks Shinden

1

100.0

216,838

1.5

1

100.0

216,531

3.7

1

96.1

117,105

0.8

1

97.7

118,525

2.0

61

96.1

2,374,009

16.3

60

95.6

2,211,691

37.9

A106

Royal Parks Seasir MinamiSenju
Subtotal

B17

Lexington Plaza Hachiman

1

98.5

165,815

1.1

1

98.5

160,501

2.7

B18

AEON TOWN Sukagawa

1

100.0

141,782

1.0

1

100.0

140,585

2.4

Subtotal

2

99.5

307,598

2.1

2

99.5

301,086

5.2

D01

Hotel MyStays Kanda

1

100.0

95,408

0.7

1

100.0

13,4050.2

D02

Hotel MyStays Asakusa

1

100.0

101,299

0.7

1

100.0

19,9870.3

D03

Hotel MyStays Kyoto-Shijo

1

100.0

173,457

1.2

1

100.0

30,4450.5

D04

MyStays Shin-Urayasu
Conference Center

1

100.0

190,903

1.3

1

100.0

36,1060.6

D05

Hotel MyStays Maihama

1

100.0

173,824

1.2

1

100.0

32,2930.6

D06

Hotel MyStays Premier
Dojima1

100.0

165,027

1.1

1

100.0

58,9981.0

D07

Hotel MyStays NagoyaSakae

1

100.0

172,065

1.2

1

100.0

41,7860.7

D08

Hotel MyStays SakaisujiHonmachi

1

100.0

68,883

0.5

1

100.0

13,2950.2

D09

Hotel MyStays Yokohama

1

100.0

144,558

1.0

1

100.0

38,4220.7

D10

Hotel MyStays Nippori

1

100.0

50,772

0.3

1

100.0

12,2260.2

D11

Hotel MyStays FukuokaTenjin-Minami

1

100.0

105,772

0.7

1

100.0

19,3000.3- 42 -Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)

D12

Flexstay Inn Iidabashi

1

100.0

49,717

0.3

1

100.0

17,1090.3

D13Hotel MyStays
Ueno Inaricho

1

100.0

39,832

0.3

1

100.0

8,995

0.2

D14

Flexstay Inn Shinagawa

1

100.0

43,802

0.3

1

100.0

10,7240.2

D15

Flexstay Inn Tokiwadai

1

100.0

50,267

0.3

1

100.0

35,1600.6

D16

Flexstay Inn Sugamo

1

100.0

44,966

0.3

1

100.0

10,8980.2

D17Hotel MyStays Otemae

1

100.0

51,537

0.4

1

100.0

9,421

0.2

D18

Hotel MyStays Kiyosumi
Shirakawa

1

100.0

29,763

0.2

1

100.0

11,6120.2

D19

Flexstay Inn Nakanobu P1

1

100.0

18,405

0.1

1

100.0

13,0860.2

D20

Flexstay Inn Nakanobu P2

1

100.0

9,827

0.1

1

100.0

4,197

0.1

D21

APA Hotel
Yokohama-Kannai

1

100.0

230,715

1.6

1

100.0

216,599

3.7

D22

Hotel MyStays HakodateGoryokaku

1

100.0

139,133

1.0

1

100.0

18,0650.3

D23

Flexstay Inn Shirogane

1

100.0

50,165

0.3

1

100.0

20,0190.3

D24

Hotel MyStays Haneda

1

100.0

181,721

1.2

1

100.0

111,581

1.9

D25

Hotel MyStays Kameido P1

1

100.0

164,644

1.1

1

100.0

54,9220.9

D26

Hotel MyStays Ueno
Iriyaguchi

1

100.0

82,136

0.6

1

100.0

19,0440.3

D27

Hotel MyStays Kameido P2

1

100.0

112,001

0.8

1

100.0

31,7960.5

D28

Hotel MyStays Shimizu

1

100.0

62,344

0.4

1

100.0

22,2500.4

D29Super Hotel
Shinbashi/Karasumoriguchi

1

100.0

39,426

0.3

1

100.0

39,4260.7

D30

Flexstay Inn Higashi-Jujo

1

100.0

33,770

0.2

1

100.0

8,888

0.2

D31

Hotel MyStays Utsunomiya

1

100.0

104,942

0.7

1

100.0

19,2470.3

D32

Flexstay Inn KawasakiKaizuka

1

100.0

29,046

0.2

1

100.0

21,574

0.4

D33

Comfort Hotel Toyama

1

100.0

35,928

0.2

1

100.0

35,9280.6

D34

Flexstay Inn KawasakiOgawacho

1

100.0

23,243

0.2

1

100.0

15,351

0.3

D35

Flexstay Inn Ekoda

1

100.0

110,246

0.8

1

100.0

53,3030.9

D36Super Hotel Tokyo-JR
Tachikawa Kitaguchi

1

100.0

31,787

0.2

1

100.0

31,787

0.5- 43 -Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)

D37

Super Hotel JR Uenoiriyaguchi

1

100.0

27,275

0.2

1

100.0

27,2750.5

D38

Hotel MyStays Shinsaibashi

1

100.0

46,178

0.3

1

100.0

13,813

0.2

D39

Comfort Hotel Kurosaki

1

100.0

37,894

0.3

1

100.0

37,894

0.6

D40

Comfort Hotel Maebashi

2

100.0

43,811

0.3

2

100.0

43,811

0.8

D41

Comfort Hotel TsubameSanjo

2

100.0

34,949

0.2

2

100.0

34,9490.6

D42

Comfort Hotel Kitami

1

100.0

30,300

0.2

1

100.0

30,3000.5

D43Hotel MyStays Gotanda
Station1

100.0

446,108

3.1

1

100.0

147,572

2.5

D44

Hotel Epinard Nasu

1

100.0

1,133,572

7.8

1

100.0

112,358

1.9

D45

Hotel MyStays Fukuoka
Tenjin1

100.0

162,989

1.1

1

100.0

29,0410.5

D46

Hotel MyStays
Hamamatsucho

1

100.0

106,591

0.7

1

100.0

27,6940.5

D47

Hotel MyStays PremierKanazawa

1

100.0

300,691

2.1

1

100.0

83,373

1.4

D48

Takamatsu Tokyu REI Hotel

3

100.0

105,381

0.7

3

100.0

100,066

1.7

D49

Hotel MyStays Premier
Hamamatsucho

1

100.0

241,981

1.7

1

100.0

74,193

1.3

D50

Hotel MyStays Shin Osaka
Conference Center

1

100.0

302,006

2.1

1

100.0

59,2081.0

D51

Hotel MyStays Premier
Omori

1

100.0

267,931

1.8

1

100.0

51,3340.9

D52

Beppu Kamenoi Hotel

1

100.0

422,105

2.9

1

100.0

95,994

1.6

D53

Hotel MyStays Sapporo
Station1

100.0

270,530

1.9

1

100.0

57,0281.0

D54

Hotel MyStays Yokohama
Kannai1

100.0

142,826

1.0

1

100.0

37,5080.6

D55

Art Hotel Joetsu

1

100.0

128,659

0.9

1

100.0

3,164

0.1

D56

Art Hotel Hirosaki City

1

100.0

138,449

1.0

1

100.0

2,997

0.1

D57

Hotel MyStays Oita

1

100.0

75,236

0.5

1

100.0

14,0790.2

D58

Hotel MyStays Gotanda

1

100.0

94,523

0.6

1

100.0

25,281

0.4

D59

Hotel MyStays Tachikawa

1

100.0

95,035

0.7

1

100.0

39,951

0.7

D60

Hotel MyStays Premier
Akasaka
Hotel MyStays Premier
Sapporo Park

1

100.0

434,197

3.0

1

100.0

103,236

1.8

1

100.0

453,495

3.1

1

100.0

75,356

1.3

D61- 44 -Name of property

33rd fiscal period(July 1, 2019 to December 31, 2019)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)34th fiscal period(January 1, 2020 to June 30, 2020)
Occupancy
RentalNumber ofrate
revenue
Ratio oftenants(at end of(during
rental(at end of
period)period)revenueperiod)
(%)
(JPY
(%)
(unit)(Note 1)
thousand)(Note 3)(Note 3)(Note 2)

D62

Hotel MyStays Ueno East

1

100.0

131,635

0.9

1

100.0

25,1720.4

D63

Hotel MyStays Midosuji
HonmachiHotel MyStays Sapporo
Aspen

1

100.0

57,242

0.4

1

100.0

20,609

0.4

1

100.0

432,075

3.0

1

100.0

101,004

1.7

D65

Art Hotel Ishigakijima

1

100.0

335,245

2.3

1

100.0

34,431

0.6

D66

Hotel MyStays Fuji Onsen
Resort1

100.0

332,016

2.3

1

100.0

43,3440.7

D67

Hotel Sonia Otaru

1

100.0

205,688

1.4

1

100.0

30,0740.5

D68

Hotel MyStays Kanazawa
Castle1

100.0

171,802

1.2

1

100.0

22,1190.4

D69

Art Hotel Niigata Station

1

100.0

261,189

1.8

1

100.0

37,4920.6

D70

Hotel MyStays Nagoya
Nishiki1

100.0

139,746

1.0

1

100.0

27,0080.5

D71

Hotel Nord Otaru

1

100.0

163,764

1.1

1

100.0

27,0270.5

D72

Hotel MyStays Kagoshima
Tenmonkan

2

100.0

139,722

1.0

2

100.0

26,7230.5

D73

Art Hotel Asahikawa

1

100.0

251,020

1.7

1

100.0

15,0000.3

D74

Hotel MyStays Matsuyama

1

100.0

145,755

1.0

1

100.0

23,856

0.4

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

1

100.0

72,160

0.5

1

100.0

15,812

0.3

1

100.0

67,933

0.5

1

100.0

11,253

0.2

1

100.0

47,431

0.3

1

100.0

6,478

0.1

Flexstay Inn Sakuragicho

1

100.0

43,123

0.3

1

100.0

18,281

0.3

MyCUBE by MYSTAYS
Asakusa Kuramae
Hotel MyStays Kagoshima
Tenmonkan Annex

1

100.0

32,306

0.2

1

100.0

3,376

0.1

1

100.0

43,261

0.3

1

100.0

11,1120.2

D81

Hotel MyStays Nayoro

1

100.0

37,018

0.3

1

100.0

16,191

0.3

D82

Hotel MyStays Premier
Narita

-

-

-

-

1

100.0

233,209

4.0

D83

Art Hotel Morioka

-

-

-

-

1

100.0

91,727

1.6

Subtotal

86

100.0

11,864,218

81.6

88

100.0

3,326,057

57.0

Total

149

99.2

14,545,826

100.0

150

99.2

5,838,836

100.0

D64

D75
D76
D77
D78
D79
D80

(Note 1) “Occupancy rate” is calculated by dividing the leased area by leasable area.
(Note 2) “Rental revenue (during period)” indicates leasing operation revenues during the fiscal period for each property and has
been rounded down to the nearest thousand yen.
(Note 3) “Occupancy rate” and “Ratio of rental revenue” are rounded to one decimal place.
(Note 4) The trust beneficiary interest of City House Tokyo Shinbashi was sold on January 15, 2020.
(Note 5) The trust beneficiary interest of Winbell Kagurazaka was sold on December 17, 2019.

- 45 -Name of property

33rd fiscal period
34th fiscal period(July 1, 2019 to December 31, 2019)(January 1, 2020 to June 30, 2020)
Management
Management
Occupancy
Occupancy
contract
Ratio ofcontract
Ratio of
Number ofrate
Number ofrate
revenue management
revenue management
tenants(at end oftenants(at end of(during
contract(during
contract(at end of
period)(at end of
period)period)revenueperiod)revenueperiod)(%)
period)
(%)
(JPY
(%)
(JPY
(%)
(unit)(Note 1)
(unit)(Note 1)
thousand)(Note 3)thousand)(Note 3)(Note 3)(Note 3)(Note 2)
(Note 2)

D200

Westin Grand Cayman Seven
Mile Beach Resort & Spa

1

100.0

1,198,474

85.8

1

100.0

769,453

86.4

D201

Sunshine Suites Resort

1

100.0

199,147

14.2

1

100.0

120,989

13.6

Total

2

100.0

1,397,621

100.0

2

100.0

890,442100.0(Note 1) “Occupancy rate” is calculated using the area subject to management contract.
(Note 2) “Management contract revenue” is converted to JPY using the exchange rate at the time of the transaction.
(Note 3) “Occupancy rate” and “Ratio of management contract revenue” are rounded to one decimal place.

- 46 -

4

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

5

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

6

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

Name

Type

Preferred equity
securities in
Kingdom Special
Purpose Company

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

Notes

Preferred equity 178,458
securities-

17,856-

17,8561)- (Note(Note 2)--

17,856-

17,856-

Total(Note 1) Fair value of the preferred equity securities indicates the acquisition cost.
(Note 2) INV owns 178,458 units of preferred equity securities issued by Kingdom Special Purpose Company (equivalent to49.0% of preferred equity securities issued and outstanding after the issuance of the said preferred equity securities),with the Sheraton Grande Tokyo Bay Hotel as an underlying asset.

7

Status of Contract Amount and Fair Value of Specified Transaction
As of June 30, 2020, the contract amount and fair value of the outstanding transaction under the specified transaction accountof INV are as follows.
(Unit: JPY thousand)Category

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

Fair value(Note 2)

Interest rate swap
98,362,000
65,133,000(65,906)
Receive floating rate/pay fixed rate
Currency option transaction, short
3,271,290
1,890,460
USD/CallNon-market(Option fees)(79,014)(46,376)(48,852)
transaction
Currency option transaction, long
3,271,290
1,890,460
USD/Put(Option fees)
109,770
70,605
138,567(Note 1) The contract amount, etc. for interest rate swap are stated based on a notional principal.
(Note 2) Estimation method for fair value
Interest rate swap
Estimated based on the price, etc. presented by the correspondent financial institutions.
Currency option
Indicates fair values of option fees, etc. presented by the correspondent financial institutions.

8

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

9

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

- 47 -

Country nameAmount held
(JPY million)(Note 1)

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

No. ofproperties(properties)

Japan

459,584

523,561

93.5

146

The Cayman Islands

35,52736,620

6.5

2

Total

495,112560,182

100.0

148

(Note 1)
(Note 2)

“Amount held” is from the balance sheet (book value after depreciation for real estate and trust beneficiary interestin real estate; and book value for preferred equity securities with real estate as underlying assets) as of June 30, 2020.
“Appraisal value as of the end of the Reporting Period” indicates the real estate appraisal value as of June 30, 2020,or the research value stated in the real estate research report and the appraisal value of investment securities.
“Appraisal value as of the end of the Reporting Period” for preferred equity securities which INV holds in Japan
indicates acquisition cost since their fair value is deemed extremely difficult to value. “Appraisal value as of theend of the Reporting Period” for assets which INV holds in the Cayman Islands indicates the amount converted to
JPY using the exchange rate of USD 1 = JPY 107.74, which is the exchange rate on the closing date of the fiscal
period (June 30, 2020).

- 48 -

Capital Expenditures for Properties Held by INV

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

Hotel MyStays
D49 Premier
Hamamatsucho
A47

Growth Maison
Kaijin

D71 Hotel Nord Otaru

2

Scheduled time of
implementation

Total

Payment for
Advancethe Reporting
payments
PeriodFrom July 2020
Automatic fire alarm
facility renewal work To December 2020

30,750--

Funabashi-shi, Parking lot repair
work
Chiba

From July 2020
To December 2020

22,000--Otaru-shi,
Hokkaido

Parking lot repair
work

From July 2020
To December 2020

12,000--Location

Minato-ku,
TokyoPurposeB17

Lexington Plaza
HachimanSendai-shi,
Miyagi

Air conditioning
facility repair work

From July 2020
To December 2020

11,000--D52

Beppu Kamenoi
Hotel

Beppu-Shi,
Oita

From July 2020
Elevators repair work To December 2020

8,500

-

-

Capital Expenditures for the Fiscal Period Ended June 30, 2020
The principal construction work constituting capital expenditures for the real estate assets for the fiscal period ended June30, 2020 is as follows. Capital expenditures for the fiscal period totaled JPY 1,650,884 thousand, and together with JPY
21,467 thousand in repair costs included in this fiscal period’s expenses, construction work totaling JPY 1,672,352 thousand
was implemented.
Name of property

Location

PurposeTime of implementation

Payment(JPY thousand)Westin Grand Cayman
D200 Seven Mile Beach
Resort & SPA

Grand Cayman,
Restaurants and kitchens
Caymanrenovation work
Islands

From January 2020
To June 2020

369,712

D44 Hotel Epinard Nasu

Nasu-gun,Tochigi

Energy-saving facility
introduction work

From January 2020
To June 2020

145,209

D46

Hotel MyStays
Hamamatsucho

Minato-ku,TokyoRenovation work

From January 2020
To June 2020

135,004

D69

Art Hotel Niigata
StationNiigata-shi,
Niigata

Energy-saving facility
introduction work

From January 2020
To June 2020

130,296

D45

Hotel MyStays
Fukuoka Tenjin

Fukuoka-shi,
FukuokaRenovation work

From January 2020
To June 2020

126,896743,765

Other construction

1,650,884

Total- 49 -

3

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

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

Fiscal period

Reserved funds at beginningof period
Amount reserved(Note)
Amount reversed(Note)
Amount carried over for
next fiscal period(Unit: JPY thousand)
30th
31st
32nd
33rd
34th
fiscal period
fiscal period
fiscal period
fiscal period
fiscal period
From January 1, From July 1, 2018 From January 1, From July 1, 2019 From January 1,
2018 to June 30, to December 31, 2019 to June 30, to December 31, 2020 to June 30,
2018
2018
2019
2019
2020
1,566,108

1,611,828

1,814,515

2,039,622

2,543,226

468,448

618,404

1,215,476

1,621,422

3,908,773

422,728

415,718

990,368

1,117,818

966,636

1,611,828

1,814,515

2,039,622

2,543,226

5,485,363(Note) The amount reserved for the relevant fiscal period includes the reserves for acquired properties, and the amount reversed
includes the reserves for sold properties.

- 50 -

Overview of Expenses and Liabilities
1

Statement of Operating Expenses
33rd fiscal period
July 1, 2019 to December 31, 2019
300,000
25,51857,4444,800
129,956
517,719

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

2(JPY thousand)34th fiscal period
January 1, 2020 to June 30, 2020
300,000
26,23147,2594,800
198,092
576,383

Borrowing Conditions

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

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

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Short-term Sumitomo Mitsui Banking
Corporation
loans
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited

Jul. 19,2019

Jan. 6,
2020

671,000-

671,500-

671,500-

672,000--

880,000

Subtotal

2,686,000

880,000

Mizuho Bank, Ltd.

5,992,000

5,992,000

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

5,992,000

5,992,000

5,992,000

5,992,000

3,330,000

3,330,000

3,000,000

3,000,000

2,670,000

2,670,000

1,335,000

1,335,000

668,000

668,000

3,400,000

3,400,000

850,000

850,000

965,000-

1,125,000-

2,180,000-

570,000-

570,000-

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

Jul. 16,
2015

Jan. 22,2016

Long-term
Mizuho Bank, Ltd.
loans
（Note 5） MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Resona Bank, Limited
MUFG Bank, Ltd.

650,000-

2,000,000-

The Bank of Fukuoka, Ltd.

333,000-

The Shizuoka Bank, Ltd.

270,000-

The Kagawa Bank, Ltd.

500,000-

The Hyakugo Bank, Ltd.
The Nomura Trust andBanking Co., Limited

1,000,000-

270,000-

Japan Post Bank Co., Ltd.

Mar. 31,2016- 51 -

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

Notes

0.280

Jul. 18,
2020

Unsecured(Note 4) (Note 2) / with noguarantee

0.261

Jan. 6,2021(Note 3) (Note 2)

0.590

Jul. 16,
2020

Unsecured(Note 3) (Note 2) / with noguarantee

0.600

Jan. 22,2021

Unsecured(Note 3) (Note 2) / with noguarantee

0.569

Mar. 30,
2020

Unsecured(Note 3) (Note 2) / with noguarantee

Type

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

Mizuho Bank, Ltd.

1,965,000

1,965,000

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

1,125,000

1,125,000

2,180,000

2,180,000

570,000

570,000

570,000

570,000

650,000

650,000

The Bank of Fukuoka, Ltd.

1,333,000

1,333,000

The Shizuoka Bank, Ltd.

270,000

270,000

The Kagawa Bank, Ltd.

500,000

500,000

The Hiroshima Bank, Ltd.
The Nomura Trust andBanking Co., Limited

1,000,000

1,000,000

270,000

270,000

Resona Bank, Limited
MUFG Bank, Ltd.

Mar. 31,2016

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

0.661

Mar. 30,
2021

Notes

Unsecured(Note 3) (Note 2) / with noguarantee

Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee

Citibank, N.A., Tokyo
BranchJun. 15,2016

1,000,000

-

0.541

Jun. 15,
2020

Citibank, N.A., Tokyo
BranchJun. 15,2016

1,000,000

1,000,000

0.661

Jun. 15,2021

AEON Bank, Ltd.

Jun. 30,2016

3,000,000

3,000,000

0.661

Jun. 30,2021

600,000

600,000
0.561

Jul. 20,
2020

Unsecured(Note 3) (Note 2) / with noguarantee

0.661

Jul. 20,
2021

Unsecured(Note 3) (Note 2) / with noguarantee

0.469

Mar. 14,2020

Unsecured(Note 3) (Note 2) / with noguarantee

0.561

Mar. 14,2021

Unsecured(Note 3) (Note 2) / with noguarantee

Tokyo Star Bank, Limited
Long-term
loans
The Towa Bank, Ltd.
（Note 5）

Jul. 20,
2016

Tokyo Star Bank, Limited

Jul. 20,2016

1,000,000

1,000,000

1,700,000

1,700,000

634,000-

1,000,000-

333,000-

333,000-

333,000-

252,000-

The Shizuoka Bank, Ltd.

200,000-

The Gunma Bank, Ltd.

165,000-

Mizuho Bank, Ltd.

1,633,000

1,633,000

Resona Bank, Limited

333,000

333,000

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

333,000

333,000

333,000

333,000

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

Mar. 14,2017

Mar. 14,2017

253,000

253,000

The Shizuoka Bank, Ltd.

200,000

200,000

The Gunma Bank, Ltd.

165,000

165,000- 52 -

Type

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

Mizuho Bank, Ltd.

1,733,000

1,733,000

Resona Bank, Limited

333,000

333,000

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

333,000

333,000

333,000

333,000

900,000

900,000

The Towa Bank, Ltd.

253,000

253,000

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

200,000

200,000

500,000

500,000

165,000

165,000

3,000,000

3,000,000

4,321,000

4,321,000

3,000,000

3,000,000

355,000

355,000

355,000

355,000

334,000

334,000

300,000

300,000

190,000

190,000

167,000

167,000

167,000

167,000

355,000

355,000

355,000

355,000

333,000

333,000

300,000

300,000

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

190,000

190,000

167,000

167,000

167,000

167,000

Mizuho Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchResona Bank, Limited
Development Bank ofJapan, Inc.
The Bank of Fukuoka, Ltd.

500,000

500,000

500,000

500,000

500,000

500,000

355,000

355,000

355,000

355,000

333,000

333,000

1,500,000

1,500,000

300,000

300,000

190,000

190,000

166,000

166,000

166,000

166,000

500,000

500,000

Sumitomo Mitsui Banking
Corporation
Mizuho Bank, Ltd.
The Daiichi Life InsuranceCo., Ltd.
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchResona Bank, Limited
The Bank of Fukuoka, Ltd.

Mar. 14,2017

Mar. 14,2017
May 29,2017

Oct. 13,
2017

AEON Bank, Ltd.
The Nomura Trust andBanking Co., Limited
Long-term The Hiroshima Bank, Ltd.
loans
（Note 5） Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchResona Bank, Limited
The Bank of Fukuoka, Ltd.

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

Oct. 13,2017

Oct. 13,2017- 53 -

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

Notes

Unsecured(Note 3) (Note 2) / with noguarantee

0.661

Mar. 14,
2022

0.511

Sep. 14,
2020

0.611

Nov. 29,
2021

0.361

Oct. 13,2020

Unsecured(Note 3) (Note 2) / with noguarantee

0.461

Oct. 13,2021

Unsecured(Note 3) (Note 2) / with noguarantee

0.661

Oct. 13,2022

Unsecured(Note 3) (Note 2) / with noguarantee

Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee

Type

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

Average
Balance atBalance at
Borrowing beginning of end of Reporting interest
Repayment Repayment
rate
PurposeReporting Period
Perioddate
date
method(%)(JPY thousand) (JPY thousand) (Note1)
1,250,000

1,250,000

1,065,000

1,065,000

1,250,000

1,250,000

1,250,000

1,250,000

1,060,000

1,060,000

1,250,000

1,250,000

1,000,000

1,000,000

500,000

500,000

Mizuho Bank, Ltd.

2,442,000

2,442,000

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

2,220,000

2,220,000

1,998,000

1,998,000

1,110,000

1,110,000

1,000,000

1,000,000

MUFG Bank, Ltd.

MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchSumitomo Mitsui Trust
Bank, Limited
Mizuho Bank, Ltd.
Long- MUFG Bank, Ltd.
term loans（Note 5） Sumitomo Mitsui Banking
Corporation
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchSumitomo Mitsui Trust
Bank, Limited
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
MUFG Bank, Ltd.
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchThe Nomura Trust andBanking Co., Limited
AEON Bank, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Citibank, N.A., Tokyo
BranchDevelopment Bank ofJapan, Inc.
Resona Bank, Limited
The Nomura Trust andBanking Co., Limited
AEON Bank, Ltd.

Oct. 13,2017

Oct. 13,2017
Jun. 27,
2018

Jul. 17,
2018

Jul. 17,
2018

Jul. 17,
2018

Aug. 2,
2018

Sep. 26,2018

890,000

890,000

2,443,000

2,443,000

2,220,000

2,220,000

1,997,000

1,997,000

1,110,000

1,110,000

1,000,000

1,000,000

890,000

890,000

2,442,000

2,442,000

2,220,000

2,220,000

1,997,000

1,997,000

1,110,000

1,110,000

1,000,000

1,000,000

890,000

890,000

766,000

766,000

766,000

766,000

467,000

467,000

150,000

150,000

120,000

120,000

30,00030,00060,00060,0002,521,500

2,521,500

2,521,500

2,521,500

2,133,000

2,133,000

1,000,000

1,000,000

684,000

684,000

546,000

546,000

500,000

500,000

445,000

445,000

137,000

137,000

273,000

273,000- 54 -

Notes

0.761

Oct. 13,2023

Unsecured(Note 3) (Note 2) / with noguarantee

0.861

Oct. 11,2024

Unsecured(Note 3) (Note 2) / with noguarantee

0.750

Jun. 27,
2023

Unsecured(Note 3) (Note 2) / with noguarantee

0.361

Jul. 17,
2021

Unsecured(Note 3) (Note 2) / with noguarantee

0.461

Jul. 17,2022

Unsecured(Note 3) (Note 2) / with noguarantee

0.561

Jul. 14,2023

Unsecured(Note 3) (Note 2) / with noguarantee

0.361

Aug. 2,2021

Unsecured(Note 3) (Note 2) / with noguarantee

0.361

Sep. 26,
2021

Unsecured(Note 3) (Note 2) / with noguarantee

Type

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

Balance atBalance at
AverageBorrowing beginning of end of Reporting interest Repayment Repayment Purpose
rate
Reporting
PeriodPerioddate
date
method(JPY thousand) (JPY thousand) (%)(Note 1)
3,287,000
3,287,000

Sep. 26,
2018

Sep. 26,
2018

Jan. 22,2019

Longterm loans（Note 5） MUFG Bank, Ltd.
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited
Resona Bank, Limited
Development Bank ofJapan, Inc.
The Bank of Fukuoka, Ltd.

Mar. 29,2019

3,287,000

3,287,000

2,600,000

2,600,000

1,000,000

1,000,000

833,000

833,000

667,000

667,000

500,000

500,000

445,000

445,000

167,000

167,000

334,000

334,000

3,287,500

3,287,500

3,287,500

3,287,500

2,600,000

2,600,000

1,000,000

1,000,000

833,000

833,000

667,000

667,000

500,000

500,000

445,000

445,000

166,000

166,000

333,000

333,000

850,000

850,000

3,400,000

3,400,000

386,000

386,000

1,275,000

1,275,000

2,100,000

2,100,000

500,000

500,000

500,000

500,000

1,000,000

1,000,000

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

0.561

Sep. 26,
2023(Note 3) (Note 2)

0.373

Jan. 22,2022

Unsecured(Note 3) (Note 2) / with noguarantee

0.361

Mar. 29,
2022

Unsecured(Note 3) (Note 2) / with noguarantee

0.594

Mar. 29,2024

Unsecured(Note 3) (Note 2) / with noguarantee

Mar. 29,2029
Jun. 17,2022
Jun. 17,2022

Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee

Jan. 16,
2023

Unsecured(Note 3) (Note 2) / with noguarantee

333,000

The Shizuoka Bank, Ltd.
The Nomura Trust andBanking Co., Limited
The Senshu Ikeda Bank, Ltd.

1,270,000

1,270,000

270,000

270,000

300,000

300,000

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

1,000,000

1,000,000

1,000,000

1,000,000

500,000

500,000

1,000,000

1,000,000

0.861

1,000,000

1,000,000

0.340

1,000,000

1,000,000

0.334

Kiraboshi Bank, Ltd.
Citibank, N.A., Tokyo Branch
Development Bank ofJapan, Inc.

Mar. 29,2019
Jun. 17,2019
Jun. 28,
2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Citibank, N.A., Tokyo BranchJul. 16,2019

571,400

571,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

1,000,000

1,000,000

Shinsei Bank, Limited

200,000

200,000

Resona Bank, Limited

600,000

600,000- 55 -

Unsecured/ with no
guarantee

0.461

333,000

Mar. 29,
2019

Notes

0.400

Unsecured/ with no
guarantee

Type

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

Average
Balance atBalance at
Borrowing beginning of end of Reporting interest
Repayment Repayment Purpose
rate
date
Reporting Period
Perioddatemethod(%)(JPY thousand) (JPY thousand) (Note 1)
571,400
571,400
1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

1,000,000

1,000,000

200,000

200,000

Resona Bank, Limited

600,000

600,000

Mizuho Bank, Ltd.

1,171,400

1,171,400

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

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

1,000,000

1,000,000

200,000

200,000

Mizuho Bank, Ltd.

2,171,400

2,171,400

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

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

Jul. 16,
2019

Jul. 16,
2019

Jul. 16,2019

Mizuho Bank, Ltd.
Long- MUFG Bank, Ltd.
term loans Sumitomo Mitsui Banking(Note 5) Corporation
Sumitomo Mitsui Trust
Bank, Limited
Shinsei Bank, Limited

Jul. 16,2019

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

Jul. 19,2019

Jul. 19,2019

200,000

200,000

2,170,400

2,170,400

1,464,800

1,464,800

1,331,200

1,331,200

628,600

628,600

200,000

200,000

1,085,000

1,085,000

987,000

987,000

987,000

987,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

712,000

712,000

986,000

986,000

986,000

986,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000- 56 -

Notes

0.499

Jan. 16,
2024

Unsecured(Note 3) (Note 2) / with noguarantee

0.563

Jul. 16,
2024

Unsecured(Note 3) (Note 2) / with noguarantee

0.611

Jan. 16,
2025

Unsecured(Note 3) (Note 2) / with noguarantee

0.761

Jul. 16,
2025

Unsecured(Note 3) (Note 2) / with noguarantee

0.413

Jan. 16,
2023

Unsecured(Note 3) (Note 2) / with noguarantee

0.525

Jan. 16,
2024

Unsecured(Note 3) (Note 2) / with noguarantee

Type

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

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

Jul. 19,2019

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

Jul. 19,2019

Mizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Sumitomo Mitsui Trust
Bank, Limited
Development Bank ofLong-term Japan, Inc.
loans
(Note 5) AEON Bank, Ltd.
The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.

Jul. 19,2019

986,000

986,000

986,000

986,000

684,000

684,000

500,000

500,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000

1,212,000

1,212,000

986,000

986,000

986,000

986,000

684,000

684,000

300,000

300,000

300,000

300,000

100,000

100,000

375,000

375,000

1,211,000

1,211,000

986,000

986,000

986,000

986,000

684,000

684,000

300,000

300,000

300,000

300,000

100,000

100,000

Notes

0.580

Jul. 16,
2024

Unsecured(Note 3) (Note 2) / with noguarantee

0.611

Jan. 16,
2025

Unsecured(Note 3) (Note 2) / with noguarantee

0.761

Jul. 16,
2025

Unsecured(Note 3) (Note 2) / with noguarantee

0.761

Jul. 16,
2025

0.462

Jan. 16,2024

375,000

375,000

Tokyo Star Bank, Limited

Jul. 22,2019

700,000

700,000

Mizuho Bank, Ltd.

2,882,000

2,882,000

The Daisan Bank, Ltd.

Aug. 28,2019

800,000

800,000

The Daisan Bank, Ltd.

Oct. 15,2019

1,700,000

1,700,000

0.486

Apr. 15,2024

The Daisan Bank, Ltd.

Oct. 15,2019

1,000,000

1,000,000

0.611

Apr. 15,2025

The Nishi-Nippon City
Bank, Ltd.

Oct. 15,2019

1,000,000

1,000,000

0.761

Oct. 15,2025

Sumitomo Mitsui Trust
Bank, Limited
Sumitomo Mitsui Trust
Bank, Limited (Note 6)
Momiji Bank,Ltd. (Note 6)

Jan. 6,2020-

1,550,000

0.417

Jan. 6,2023

Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee
Unsecured(Note 3) (Note 2) / with noguarantee-

3,050,000-

1,000,000

0.643

Jan. 6,2025

The Kiyo Bank (Note 6)-

500,000

Unsecured(Note 3) (Note 2) / with noguarantee

Mizuho Bank, Ltd.

-634,000

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

-

300,000-

1,000,000-

333,000

0.487

Mar. 16,2025-

333,000

Unsecured(Note 3) (Note 2) / with noguarantee-

200,000-

450,000

The Yamaguchi Bank, Ltd.

Jan. 16,
2020

Mar. 30,
2020- 57 -

Type

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

Average
Balance atBalance at
Borrowing beginning of end of Reporting interest
Repaymen Repayment Purpose Notes
rate
date
Reporting Period
Periodt datemethod(%)(JPY thousand) (JPY thousand) (Note 1)
850,000
Mar. 30,
16, (Note 3) (Note 2) Unsecured
1,090,000
0.361 Mar.
/ with no2020
2023
guarantee
333,000

Mizuho Bank, Ltd.

-582,000

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

628,000-

1,090,000-

570,000-

500,000-

270,000

Long-term Resona Bank, Limited
loans(Note 5) The Nomura Trust andBanking Co., LimitedAozora Bank, Ltd.

Mar. 30,2020-

1,000,000

The Shizuoka Bank, Ltd.

-

270,000

The Kagawa Bank, Ltd.

-

500,000

The Yamaguchi Bank, Ltd.

-

550,000

The Chukyo Bank, Ltd.

-

1,000,000-

1,000,000

Subtotal

249,488,000

254,388,000

Total

252,174,000

255,268,000

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

0.561

Mar. 16,
2025

Unsecured(Note 3) (Note 2) / with noguarantee

0.311

Jun. 17,2022

Unsecured(Note 3) (Note 2) / with noguarantee(Note 1) Average interest rate shows the interest rate for each loan agreement as of the end of the fiscal period, rounded to three decimal places. In
regards to borrowings which interest rate swap transactions are entered into for the purpose of avoiding risk from interest rate fluctuation, interest
rates reflecting the interest rate swap are shown. In regards to borrowings repaid during the Reporting Period, the interest rate for each loan
agreement as of the repayment date rounded to three decimal places is shown.
(Note 2) The funds raised through borrowings are mainly used to acquire trust beneficiary interests in real estate and to repay the borrowings.
(Note 3) The balance at the end of the period will be repaid in full on the repayment date.
(Note 4) INV implemented the prepayment of its short-term consumption tax loan on May 29, 2020.
(Note 5) Long-term loans includes current portion of long-term loans payable.
(Note 6) JPY 1,000 million of the existing loan transferred from Sumitomo Mitsui Trust Bank, Limited to Momiji Bank,Ltd. and JPY 500 million of theexisting loan transferred from Sumitomo Mitsui Trust Bank, Limited to The Kiyo Bank on February 28, 2020.

- 58 -

3

Investment Corporation Bonds
Status of investment corporation bonds as of the end of the Reporting Period is as follows.
Bond SeriesFirst Series
Unsecured Investment
Corporation Bonds(Note 1)
Second Series
Unsecured Investment
Corporation Bonds(Note 1)
Third Series
Unsecured Investment
Corporation Bonds(Note 1)Forth Series
Unsecured Investment
Corporation Bonds(Note 1)Fifth Series
Unsecured Investment
Corporation Bonds(Note 1)
Sixth Series
Unsecured Investment
Corporation Bonds(Note 1)

Issue Date

Balance at theBalance at the Interest Rate
beginning of the
Redemption Use of
end of the period
Redemption Date(%)
periodmethodfunds(JPY thousand)(JPY thousand)May 25, 2018

1,000,000

1,000,000

0.400

May 25, 2023

(Note 2)

(Note 3)

May 25, 2018

1,000,000

1,000,000

0.800

May 25, 2028

(Note 2)

(Note 3)October 12, 2018

2,000,000

2,000,000

0.550

October 12, 2023

(Note 2)

(Note 4)

Security/
Guaranty

Unsecured /Unguaranteed
October 28, 2019

1,000,000

1,000,000

0.480

October 28, 2024

(Note 2)

(Note 5)October 28, 2019

2,000,000

2,000,000

0.900

October 26, 2029

(Note 2)

(Note 5)

March 13, 2020－

1,200,000

0.850

March 13, 2030

(Note 2)

(Note 4)

Total
7,000,000
8,200,000－－－－－(Note 1) This is with pari passu conditions among specified corporate bonds.
(Note 2) The Investment Corporation Bonds may be purchased and cancelled at any time after the payment date, except for the case where the laws andregulations or the depository otherwise stipulates.
(Note 3) The funds will be used to acquire trust beneficiary interest in real estate.
(Note 4) The funds will be used to repay borrowings.
(Note 5) The funds will be used in strategic capital expenditure.

4

Short-Term Investment Corporation Bonds

Not applicable
5

Investment Unit Options

Not applicable- 59 -

Acquisitions and Sales for the Fiscal Period Ended June 30, 2020

1

Acquisitions and Sales of Real Estate, Asset-Backed Securities, Infrastructure Assets andInfrastructure Related-Assets
Acquisition

Type of asset

Trust
beneficiaryinterest
Trust
beneficiaryinterest
Trust
beneficiaryinterest

D82

Name of property

Acquisitiondate

Acquisition
price
(JPY
million)Hotel MyStays Premier
NaritaJanuary 6,
2020

10,593－－－－January 6,
2020

5,643

－

－

－

－

－

－

January 15,
2020

4,465

2,269

2,046

－

4,465

2,269

2,046

D83 Art Hotel Morioka
A51

Sale

City House Tokyo
Shinbashi
Total

Sales date

16,236

Sales priceGain/loss on
Book value(JPY million)
sales(JPY million)(Note 1)(JPY million)(Note 1) Acquisition price or sales price do not include various costs (brokerage commissions, taxes and other public dues) required for sale of theproperty, and is the sales price indicated in the trust beneficiary interest purchase agreement.

2

Acquisitions and Sales of Other Assets

Assets other than those described above were mostly bank deposits or bank deposits in trust.
3

Transaction Price Verification of Specified Assets

Real Estate Transactions
Acquisitionor saleName of property

Category of Transaction
specified asset
date

Sales price(JPY
million)(Note 1)

Appraisal
value
(JPY
million)Appraiser

Appraisal
dateReal estate
January 6,
The Tanizawa Sōgō October 1,
Trust
10,593
10,700beneficiary2020
Appraisal Co., Ltd.
2019
interest
Real estate
JLL Morii
January 6,
October 1,
Trust
Acquisition D83 Art Hotel Morioka
5,643
5,700
Valuation &beneficiary
2020
2019
Advisory
K.K.
interest
Real estate
City House Tokyo
January 15,
Japan Real Estate November 1,
Trust
Sale
A51
4,465
3,650
beneficiary
2020
Institute2019
Shinbashiinterest(Note 1) Acquisition price or sales price do not include various costs (brokerage commissions, taxes and other public dues) required for acquisition of
the property and is the purchase price indicated in the trust beneficiary interest purchase agreement.
(Note 2)The real estate appraisal described above is conducted by applying “Section 3: appraisals concerning prices of real estate subject to securitization”
of “Real Estate Appraisal Standard.”
Acquisition

D82

Hotel MyStays Premier
NaritaOther Transactions
There were eight other transactions involving currency options between January 1, 2020 and June 30, 2020 as transactions forwhich survey requests were made. In addition to comparable prices pursuant to Article 201, Paragraph 2 of the Investment Trust
Act, INV has entrusted a survey to Akasaka Audit LLC and obtained survey reports on the transaction dates, names ofcounterparties, brands, agreed figures, types of financial instruments or financial indicators, put or call types, exercise prices,
exercise periods, transaction periods, and other details of the over-the-counter derivatives transactions.

- 60 -

4

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

Transactions between the Asset Manager and Its Other Businesses

As the Asset Manager (Consonant Investment Management Co., Ltd.) does not engage in any other business,such as the type I financial instruments business and the type II financial instruments business, the building lots
and buildings transaction business, or the real estate specified joint enterprise, there are no applicabletransactions.

Financial Condition
1

Assets, Liabilities, Principal, and Profit and Loss

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

Changes in the Calculation Method of Depreciation

Not applicable
3

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

Not applicable4

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

Not applicable- 61 -

Other1

NoticeBoard of Directors of Investment Corporation
Of the execution and amendment of the principal agreement approved by INV’s Board of Directors in theReporting Period, principal summary is as follows.
Approval dateFebruary 28, 2020

May 11, 2020

2

Item

Summary

Comprehensive resolution
on issuance of investment
corporation bonds

Board of Directors passed a comprehensive resolution on issuance ofinvestment corporation bonds with a maximum total issue amount of
JPY 1.5 billion and an issuance period from February 28, 2020 to March24, 2020; and entrustment of administrative duties concerning offeringof investment corporation bonds and general administrative duties as an
issuing agent, fiscal agent, paying agent, etc. to a prescribed generaladministrative agent.

Conclusion of MOU toamend the MLPM
Agreements with Major
Tenant, MHM GroupOn May 11, 2020, INV entered into a MOU to amend respective MLPM
Agreements for domestic hotels owned by INV and operated by INV's
main tenant, MHM Group. Pursuant to the MOU, INV (i) waived thefixed rent during the relevant period and changed the calculation
method of the variable rent by way of amendment of the MLPM
Agreements in part and (ii) bore some property management costs thatwould normally be borne by the MHM Group under the former
agreement and (iii) increased the amount of the management fees
payable to the MHM Group.

Disclosure of Companies Owning Real Estate Overseas

Not applicable
3

Disclosure of Real Estate Owned by Companies Owning Real Estate Overseas

Not applicable
4

Other

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

- 62 -

II.

Balance Sheet(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2019(as of December 31, 2019)

AssetsCurrent assets:
Cash and bank deposits
Cash and bank deposits in trust
Accounts receivable
Rental receivables
Deposits paid
Prepaid expenses
Income taxes receivable
Consumption taxes receivable
Other
Total current assets
Non-current assets:
Property and equipment
Buildings
Accumulated depreciation
Buildings, net
Buildings and accompanying facilities
Accumulated depreciation
Buildings and accompanying facilities, net
Structures, at cost
Accumulated depreciation
Structures, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Construction in progress
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Buildings and accompanying facilities in trust
Accumulated depreciation
Buildings and accompanying facilities in trust, net
Structures in trust, at cost
Accumulated depreciation
Structures in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Land in trust
Construction in progress in trust
Total property and equipment, net
Intangible assets
Leasehold rights
Leasehold rights in trust
Total intangible assets
Investment and other assets
Investment securities
Guarantee deposits
Long-term prepaid expenses
Derivatives assets
OthersTotal investments and other assets
Total non-current assets
Deferred assets
Investment corporation bond issuance costs
Total deferred assets
Total assets- 63 -

Fiscal period ended
June 30, 2020(as of June 30, 2020)

17,924,733
10,862,669
613,5633,448,548
482,506
718,710
137,528
2,239,471
154
36,427,886

10,190,672
6,127,902
304,863262,507582,415
129,613
831,675
18,429,649

19,142,244(278,377)
18,863,867
5,111,514(190,462)
4,921,052
1,087,303(64,425)
1,022,877
534,690
159,549,904(15,114,933)
144,434,970
33,269,242(8,355,624)
24,913,618
234,012(100,967)
133,045
2,382,539(763,771)
1,618,767
245,771,234
3,179
442,217,302

19,392,579(494,780)
18,897,798
5,292,840(342,143)
4,950,697
1,458
(19)
1,439
1,160,530(117,632)
1,042,897
486,479
167,743,709(17,281,345)
150,462,363*3 33,693,125(9,275,639)
24,417,485
250,163(102,281)
147,8822,766,458(954,147)
1,812,311
250,271,308
129,129452,619,792

10,637,811
13,265,876
23,903,688

10,637,811
14,614,328
25,252,140

17,856,387
803,721974,554
166,234
22,667
19,823,566
485,944,557

17,856,387
1,362,721
898,626
152,275
22,667
20,292,677
498,164,611

59,55659,556522,431,999

69,157
69,157
516,663,418

(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2019(as of December 31, 2019)

Fiscal period ended
June 30, 2020(as of June 30, 2020)

Liabilities
Current liabilities:
Accounts payable

443,004

142,330

Short-term loans payable

2,686,000

880,000

Current portion of long-term loans payable

50,130,000

57,380,000

Accounts payable-other

125,221

301,280

Accrued expenses

272,659

269,814

Income taxes payable
Advances received
Deposits received

605

605

798,980

1,000,217

52,12831,88954,508,599

60,006,137

7,000,000

8,200,000

199,358,000

197,008,000

1,765,094

1,749,862

Derivatives liabilities

37,007

128,466

Asset retirement obligations

32,53932,756

Total non-current liabilities

208,192,641

207,119,086

262,701,240

267,125,223

235,701,512

235,701,512

6,264,432

6,264,432

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

Total liabilities
Net assets
Unitholders’ equity:
Unitholders’ capital
Surplus:Capital surplus
Deduction of unitholders' capital surplus
Allowance for temporary differences adjustment*2(6,130)*2(6,130)

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

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

734,294734,294

Retained earnings

23,261,426

13,168,294

Total surplus

23,995,720

13,902,588

259,697,232

249,604,100

Deferred gains or losses on hedges

33,525(65,906)

Total valuation and translation adjustments

33,525(65,906)

Capital surplus, net

Total unitholders’ equity
Valuation and translation adjustments:

Total net assets*1

Total liabilities and net assets

259,730,758
522,431,999- 64 -*1

249,538,194
516,663,418

III.

Statement of Income and Retained Earnings(Unit: JPY thousand)(Reference)
Fiscal period ended
December 31, 2019(as of December 31, 2019)

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

*1
*2
*3

- 65 -

Fiscal period ended
June 30, 2020(as of June 30, 2020)

14,545,826
1,397,621
1,970,306
673,498
18,587,253*1
5,838,836*2
890,442*3
2,046,294
634,651
9,410,225*1
4,673,007*2
537,542300,000
4,800
25,51857,444
129,956
5,728,269
12,858,984*1
6,801,584*2535,279
300,000
4,800
26,23147,259198,092
7,913,247
1,496,977

179
40,710289
2,091
43,270114
7,712
47,743
1,613
57,183

687,208
15,654

702,917
31,67525,911

4,256

5,928

412,550
143,029
1
1,262,700
11,639,553

362,534670
1,129,639
424,522-

73,11973,119

11,639,553
605
605
11,638,948
11,622,477
23,261,426

73,11973,119424,522605
605
423,917
12,744,377
13,168,294

IV.

Statement of Changes in Net Assets(Reference) Fiscal period ended December 31, 2019 (from July 1, 2019 to December 31, 2019)(Unit: JPY thousand)Unitholders’ equity
SurplusCapital surplus
Unitholders’capitalDeduction of capital surplus
Capital surplus

Balance at the beginningof the period
Changes during theperiodIssuance of new
investment units
Reversal of allowancefor temporary
differences adjustment
Distributions fromsurplus
Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiod211,092,540

Allowance fortemporarydifferences
adjustment

6,264,432

Total
deduction ofcapital surplus

Capital surplus(net)(131,332)(5,398,804)(5,530,137)

734,294

125,201(125,201)－－

24,483,770
125,201

24,608,971－

125,201(125,201)－－

235,701,512

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

734,294

Unitholders’ equity
Surplus

Balance at the beginningof the period
Changes during theperiodIssuance of new
investment units
Reversal of allowancefor temporary
differences adjustment
Distributions fromsurplus
Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodOther
deduction ofcapital surplus

Retained earnings

Total surplus

21,131,966

21,866,261

Total
unitholders’equity232,958,801

Valuation and translation adjustments
Total
Deferredvaluation andgains or losses
translation
on hedges
adjustments
87,612

87,612Total
net assets

233,046,414

24,483,770

24,483,770(125,201)(125,201)－－(9,384,287)(9,384,287)(9,384,287)(9,384,287)

11,638,948

11,638,948

11,638,948

11,638,948(54,086)(54,086)(54,086)

2,129,459

2,129,459

26,738,431(54,086)(54,086)

26,684,344

23,261,426

23,995,720

259,697,232

33,52533,525

259,730,758- 66 -

Fiscal period ended June 30, 2020 (from January 1, 2020 to June 30, 2020)(Unit: JPY thousand)Unitholders’ equity
SurplusCapital surplus
Deduction of capital surplus

Unitholders’capitalCapital surplus

Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus

Allowance fortemporarydifferences
adjustment

Other
deduction ofcapital surplus

Total
deduction ofcapital surplus

Capital surplus(net)

235,701,512

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

734,294

－

－

－

－

－

－

235,701,512

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

734,294

Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodUnitholders’ equity
Surplus

Balance at the beginningof the period
Changes during theperiodDistributions fromsurplus
Net income
Changes other thanunitholders’ equity(net)
Total changes during theperiodBalance at the end of theperiodValuation and translation adjustments
Totalunitholders’equityDeferred
gains or losses
on hedges

Totalvaluation andtranslation
adjustments

33,52533,525Total
net assets

Retainedearnings

Total
surplus23,261,426

23,995,720

259,697,232(10,517,049)(10,517,049)(10,517,049)(10,517,049)

423,917423,917423,917423,917259,730,758(99,432)(99,432)(99,432)(10,093,131)(10,093,131)(10,093,131)(99,432)(99,432)(10,192,564)

13,168,294

13,902,588

249,604,100(65,906)(65,906)

249,538,194- 67 -

V.

Notes to Financial Statements[Notes Concerning Significant Accounting Policies]
By Period
Item(Reference)
Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)

1. Evaluation standards and Other securities
evaluation method ofThose with no fair value
assetsCost method through moving-average method
is used.

2. Method of depreciationof non-current assets

Fiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)(a) Other securitiesThose with no fair value
Cost method through moving-average method
is used.
(b) Claims generated and debt incurred throughderivative transactions
Market value method is used.

(a) Property and equipment(a) Property and equipment
The straight-line method is used.
The straight-line method is used.
The useful lives of major property, plant
The useful lives of major property, plantand equipment are as follows.
and equipment are as follows.
Buildings
16-50 years
Buildings
16-50 years
Buildings and accompanying facilities
Buildings and accompanying facilities
5-29 years
5-29 years
Tools, furniture and fixtures
3-10 years
Structures
20 years
Buildings in trust
5-67 years
Tools, furniture and fixtures
3-18 years
Buildings and accompanying facilities in
Buildings in trust
7-67 years
trust
2-33 years
Buildings and accompanying facilities in
Structures in trust
9-55 years
trust
2-33 years
Tools, furniture and fixtures in trust
Structures in trust
10-55 years
2-19 years
Tools, furniture and fixtures in trust(b) Intangible assets
2-20 years
For fixed-term land lease for business(b) Intangible assets
purposes in Japan, the straight-line method
For fixed-term land lease for businessbased on the lease period is used.
purposes in Japan, the straight-line method(c) Long-term prepaid expenses
based on the lease period is used.
The straight-line method is used.
(c) Long-term prepaid expenses
The straight-line method is used.
3. Accounting treatment of (a) Investment unit issuance costs
Investment corporation bond issuance costs
deferred assets
The full amount is recorded as expense at
Investment corporation bond issuance costs
the time of expenditure.
are amortized using the straight-line method(b) Investment corporation bond issuance costs over a period up to redemption of theInvestment corporation bond issuance costs investment corporation bonds.
are amortized using the straight-line
method over a period up to redemption of
the investment corporation bonds.
4. Method of calculating
Allowance for doubtful accounts
Allowance for doubtful accounts
allowances
To reserve for losses on doubtful accounts, To reserve for losses on doubtful accounts,
allowances are provided for normal receivables allowances are provided for normal receivables
using a rate determined based on past bad debt using a rate determined based on past bad debt
experiences, and specific allowances are experiences, and specific allowances areprovided for accounts with a possibility of provided for accounts with a possibility ofdefault based on the estimated amounts default based on the estimated amounts
considered to be uncollectible by considering considered to be uncollectible by considering
the collectability of accounts on an individual the collectability of accounts on an individual
basis.
basis.
5. Conversion of assets and Receivables and payables denominated in Receivables and payables denominated inliabilities in foreignforeign currencies are translated into yen at the foreign currencies are translated into yen at thecurrency into Japanesespot exchange rate at the end of the fiscal period spot exchange rate at the end of the fiscal periodyendate, and differences arising from the date, and differences arising from thetranslation are treated as a profit or loss.
translation are treated as a profit or loss.

- 68 -

By Period
Item
6. Revenue and expense
recognition

7. Method of hedge
accounting(Reference)
Fiscal period ended
Fiscal period ended
December 31, 2019
June 30, 2020
(from July 1, 2019 to(from January 1, 2020 to
December 31, 2019)
June 30, 2020)
Accounting treatment of property taxes and Accounting treatment of property taxes andother taxes
other taxes
With respect to property taxes, city planning With respect to property taxes, city planningtaxes and depreciable asset taxes, of the tax taxes and depreciable asset taxes, of the tax
amount assessed and determined, the amount amount assessed and determined, the amountcorresponding to the relevant fiscal period is corresponding to the relevant fiscal period is
accounted for as property related expenses.
accounted for as property related expenses.
Of the amounts paid to the seller for Of the amounts paid to the seller for
acquisitions of real estate, the amount acquisitions of real estate, the amountequivalent to property taxes is capitalized as equivalent to property taxes is capitalized aspart of the acquisition cost of the real estate part of the acquisition cost of the real estate
instead of being charged as expense. The instead of being charged as expense. The
amount equivalent to property taxes that was amount equivalent to property taxes that was
included as part of the acquisition cost of real included as part of the acquisition cost of realestate during the fiscal period ended December estate during the fiscal period ended June 30,
31, 2019 is JPY 111,155 thousand.
2020 is JPY 41,528 thousand.
(a) Method of hedge accounting(a) Method of hedge accounting
Deferred hedge accounting is used.
Deferred hedge accounting is used.
(b) Hedging instrument and hedged item
(Borrowings)
Hedging instrument: interest rate swap
Hedged item: interest on borrowings(Scheduled foreign currency-denominatedtransactions)
Hedging instrument: Foreign exchange
optionHedged item: Scheduled foreign currencydenominated transaction(c) Hedge policy
INV enters into derivatives transactions forthe purpose of hedging against the risks set
forth in INV’s Articles of Incorporation inaccordance with its risk management
policy.

8. Other significant
matters whichconstitute the basis for
preparation of financial
statements(b) Hedging instrument and hedged item
Hedging instrument: interest rate swap
Hedged item: interest on borrowings(c) Hedge policy
INV enters into derivatives transactions forthe purpose of hedging against the risks set
forth in INV’s Articles of Incorporation inaccordance with its risk management
policy.
(d) Method of evaluating hedge effectivenessHedge effectiveness is evaluated bycomparing the cumulative amount ofchanges in cash flows of the hedging
instrument and the cumulative amount ofchanges in cash flows of the hedged item
and verifying the difference in the amountsof change of both the hedged item and thehedging instrument.

(d) Method of evaluating hedge effectivenessHedge effectiveness is evaluated bycomparing the cumulative amount ofchanges in cash flows of the hedging
instrument and the cumulative amount ofchanges in cash flows of the hedged item
and verifying the difference in the amountsof change of both the hedged item and thehedging instrument.
(1) Accounting treatment policy of trust(1) Accounting treatment policy of trust
beneficiary interests in real estate
beneficiary interests in real estate
As to trust beneficiary interests in real
As to trust beneficiary interests in realestate, all accounts of assets and liabilities
estate, all accounts of assets and liabilities
within assets in trust, as well as all income
within assets in trust, as well as all income
generated and expenses incurred fromgenerated and expenses incurred fromassets in trust, are recorded in the relevant
assets in trust, are recorded in the relevantbalance sheets and income statementbalance sheets and income statement
accounts. Of such items, the following
accounts. Of such items, the following
significant trust assets and liabilities are
significant trust assets and liabilities areshown separately on the balance sheet.
shown separately on the balance sheet.

- 69 -

By Period
Item(Reference)
Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)(a) Cash and bank deposits in trust(b) Buildings in trust
Buildings and accompanying facilities
in trust
Structures in trust
Tools, furniture and fixtures in trust
Land in trust
Construction in progress in trust(c) Leasehold rights in trust(d) Tenant leasehold and security deposits
in trust(2) Accounting treatment of consumption taxes
Transactions subject to consumption taxes
are recorded at amounts exclusive ofconsumption taxes.

Fiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)(a) Cash and bank deposits in trust(b) Buildings in trust
Buildings and accompanying facilities
in trust
Structures in trust
Tools, furniture and fixtures in trust
Land in trust
Construction in progress in trust(c) Leasehold rights in trust(d) Tenant leasehold and security deposits
in trust(2) Accounting treatment of consumption taxes
Transactions subject to consumption taxes
are recorded at amounts exclusive ofconsumption taxes.

[Notes to the Balance Sheet](Reference) Fiscal period ended December 31, 2019
Fiscal period ended June 30, 2020(as of December 31, 2019)(as of June 30, 2020)*1. Minimum net assets as required by Article 67, Paragraph *1. Minimum net assets as required by Article 67, Paragraph
4 of the Act on Investment Trusts and Investment
4 of the Act on Investment Trusts and Investment
Corporations
Corporations
JPY 50,000 thousand
JPY 50,000 thousand*2. Allowance for temporary differences adjustment(Reference) Fiscal period ended December 31, 2019 (from July 1, 2019 to December 31, 2019)
1. Reasons, related assets and amounts(Unit: JPY thousand)Allowance
Balance at theReversal
Relatedset aside
Balance at theReasonInitial amount
beginning ofduringassets, etc.
duringend of period
periodperiodperiodLeasehold Sale of asset with
(131,332)(131,332)
125,201(6,130)rights inleasehold rights
trust
in trust(131,332)

Total(131,332)-

125,201(6,130)2. Method of reversal(1) Leasehold rights in trust
The corresponding amount is scheduled to be reversed upon sale of the relevant properties, etc.
Fiscal period ended June 30, 2020 (from January 1, 2020 to June 30, 2020)
1. Reasons, related assets and amounts(Unit: JPY thousand)Relatedassets, etc.

ReasonLeaseholdrights intrust

Depreciation ofleasehold rights

Total

Initial amount

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

- 70 -

Not applicable*3. Reduction entry amount of property and equipment
acquired with governmental subsidies, etc.
Building and accompanying facilities in trust
JPY 73,119 thousand[Notes to Statement of Income and Retained Earnings](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)*1. Real estate rental revenues and expenses(Unit: JPY thousand)
A. Real estate rental revenues*1. Real estate rental revenues and expenses(Unit: JPY thousand)
A. Real estate rental revenues

Rental revenue – real estate

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

14,306,734(Rent/common area charges) (Note)

239,092(Other revenues)

5,838,836

Total

B. Real estate rental expenses

B. Real estate rental expenses

Property-related expenses

Property-related expenses(Maintenance costs)

539,778(Maintenance costs)(Taxes and public dues)

631,040(Taxes and public dues)

598,839(Insurance expenses)

17,639(Insurance expenses)

19,721(Depreciation expenses)

3,345,473(Depreciation expenses)

3,578,589

139,076(Other expenses)

C. Real estate rental income

6,801,584

Total

9,872,819(Note) Of which, revenue from variable
hotel rents

5,317,963*2. Management contract revenue and expenses(Unit: JPY thousand)Hotel operating revenue
Hotel operating expenses
Management contract revenue (A-B)
Management contract expenses
Management fee
Non-life insurance expenses
Depreciation expenses
Other expenses
Total
Management contract revenue andexpenses (C-D)

151,732

C. Real estate rental income

(A-B)

A.
B.
C.
D.

2,452,700(Other expenses)

4,673,007

Total

E.

233,996(Other revenues)

14,545,826

Total

5,604,840

3,927,961
2,530,339
1,397,621
12,276111,278
412,305
1,680
537,542860,079*3. Gain on sales of properties(A-B)
7,662,741(962,747)(Note) Of which, revenue from variable
4,304,181
hotel rents

1,246,746*2. Management contract revenue and expenses(Unit: JPY thousand)
A.
B.
C.
D.

Hotel operating revenue
Hotel operating expenses
Management contract revenue (A-B)
Management contract expenses
Management fee
Non-life insurance expenses
Depreciation expenses
Other expenses
Total
E.

Management contract revenue andexpenses (C-D)

2,912,073
2,021,630
890,442
4,096
109,853
420,999329
535,279
355,162*3. Gain on sales of properties(Unit: JPY thousand)Winbell Kagurazaka(Unit: JPY thousand)City House Tokyo Shinbashi

Proceeds from sales of properties

5,135,530

Proceeds
12,209,814
from sales of properties

4,474,757

Cost of sales of properties

2,992,380

Cost6,422,775
of sales of properties

2,269,720- 71 -

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)
Other expenses on sales of properties

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

172,843

Gain on sales of properties

1,970,306

Other 153,225
expenses on sales of properties

158,741

Gain5,633,813
on sales of properties

2,046,294[Notes to Statement of Changes in Net Assets](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

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

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

Total number of investment units authorized 10,000,000 units 10,000,000
Total number
unitsof investment units authorized 10,000,000 units
Total number of investment units issued andoutstanding

Total number of investment units issued and6,096,840 units 6,096,840 units
outstanding

6,096,840 units[Notes Related to Tax Accounting](Reference) Fiscal period ended December 31, 2019(as of December 31, 2019)

Fiscal period ended June 30, 2020(as of June 30, 2020)

1. Significant components of deferred tax assets and liabilities(Unit: JPY thousand)(Deferred tax assets)
Enterprise tax payable821

1. Significant components of deferred tax assets and liabilities(Unit: JPY thousand)(Deferred tax assets)
Enterprise tax payable
1,294
731

Buildings and other (merger)

375,803

Buildings and428,965
other (merger)

301,485

Land (merger)

695,171

Land (merger)786,792

693,693

Loss carried forward (Note 1)

522,444

Loss carried forward
747,198(Note 1)

522,444

Asset retirement obligations

10,237

Asset retirement
10,168obligations

10,305

Amortization of leasehold right
Adjustment of acquisition prices(overseas properties)
Deposit received

88,526

Amortization of76,182
leasehold right
Adjustment of acquisition prices
477,213(overseas properties)
Deposit received

100,736

Subtotal 2,527,862
Valuation allowance for tax loss
(747,198)
carried forward
Valuation allowance for the total of
deductible (1,743,389)
temporary differences,
etc.
Subtotal (2,490,588)

2,103,480

472,363
9,301

Subtotal
Valuation allowance for tax loss
carried forward
Valuation allowance for the total of
deductible temporary differences,
etc.
Subtotal

2,174,669(522,444)(1,652,225)(2,174,669)

469,321
4,762(522,444)(1,581,036)(2,103,480)

Total- Total37,274(Note 1) The amounts of tax loss carried forward and the (Note 1) The amounts of tax loss carried forward and thedeferred tax assets by carry-forward period are asdeferred tax assets by carry-forward period are as
follows.
follows.
(Unit: JPY thousand)(Unit: JPY thousand)Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsDue
withinone year

Due after
one to twoyears

Due after
two tothree years

Due after
three tofour years--

201,976

320,467--(201,976)(320,467)

-

-

-

-

- 72 -Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsDue
withinone year

Due after
one to twoyears

Due after
two tothree years

Due after
three tofour years--

522,444---(522,444)

-

-

-

-

-

(Reference) Fiscal period ended December 31, 2019(as of December 31, 2019)

Fiscal period ended June 30, 2020(as of June 30, 2020)

Due after
four to fiveDue after
Due after
five years

Totalfour to fiveyears
Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assetsDue after
five years

Total

years
-

-

522,444--(522,444)---

Tax loss carriedforward (a)Valuation
allowance
Deferred tax
assets--522,444--(522,444)---(a) Tax loss carried forward is multiplied by statutory tax rate. (a) Tax loss carried forward is multiplied by statutory tax rate.
2. Significant difference between statutory tax rate and the
2. Significant difference between statutory tax rate and theeffective tax rate
effective tax rate
31.74%
Statutory tax rate
31.51% Statutory
31.74%
tax rate
31.46%

31.74%

Deductible cash distributions(28.47)%(31.71)%
Deductible(32.06)%
cash distributions(8.87)%%(32.06)%

Changes in valuation allowance(3.03)%(0.09)%
Changes(0.32)%
in valuation allowance(16.98)%(0.32)%

Others

0.00%

0.08%
Untaxable
0.65%
dividend income(5.61)%

Effective tax rate

0.01%

Others 0.01%

0.15%

0.65%

0.14%

0.01%

0.01%

Effective tax rate

[Notes Related to Financial Instruments](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

1. Status of financial instruments

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

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

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

The funds raised through borrowings and issuinginvestment corporation bonds are mainly used to acquire
real estate properties or trust beneficiary interest in realestate (including related acquisition costs) and for therefinancing of existing loans. Liquidity risks relating toloan are managed by the finance department of the AssetManager by preparing and updating plans for funds, andmonitoring the covenants set forth in loan agreements.
(3) Supplemental information regarding market value, etc.
for financial instruments.

The funds raised through borrowings and issuinginvestment corporation bonds are mainly used to acquire
real estate properties or trust beneficiary interest in realestate (including related acquisition costs) and for therefinancing of existing loans. Liquidity risks relating toloan are managed by the finance department of the AssetManager by preparing and updating plans for funds, andmonitoring the covenants set forth in loan agreements.
(3) Supplemental information regarding market value, etc.
for financial instruments.

The fair value of financial instruments is based on quoted- 73 -

The fair value of financial instruments is based on quoted

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

market prices if available. When quoted market prices
are not available, fair value is determined through areasonable estimate. Since certain assumptions, etc. areused in estimating the fair value, different assumptions,etc. may result in the variance of such value.

market prices if available. When quoted market prices
are not available, fair value is determined through areasonable estimate. Since certain assumptions, etc. areused in estimating the fair value, different assumptions,etc. may result in the variance of such value.

2. Estimated fair value of financial instruments.
Book value, fair value and the difference between value asof December 31, 2019 are as follows.
(Unit: JPY thousand)2. Estimated fair value of financial instruments.
Book value, fair value and the difference between value asof June 30, 2020 are as follows.
(Unit: JPY thousand)Book Value

Fair ValueBook Value

Fair Value

17,924,733

17,924,733-

10,190,672

10,190,672-

10,862,669

10,862,669-

6,127,902

6,127,902-

16,318,574

16,318,574-(880,000)(880,000)-(57,380,000)(57,380,000)

848,260(1) Cash and bankdeposits(2) Cash and bankdeposits in trust
Total assets(3) Short-term loans(4) Current portion of
long-term loans
payable(5) Investment
corporation bonds(6) Long-term loans
Total liabilities(7) Derivatives

Difference

28,787,403

28,787,403-(2,686,000)(2,686,000)-(50,130,000)(50,130,000)-(7,000,000)(6,957,300)

42,700(199,358,000)(199,358,000)-(259,174,000)(259,131,300)

42,700129,227

129,227-(1) Cash and bankdeposits(2) Cash and bankdeposits in trust
Total assets

Difference(3) Short-term loans(4) Current portion of
long-term loans
payable(5) Investment
corporation bonds(6) Long-term loans(8,200,000)(7,351,740)(197,008,000)(197,008,000)-

Total liabilities(263,468,000)(262,619,740)

848,260

23,80823,808-(7) Derivatives(*1) Items recorded in the Liabilities Section are shown inparenthesis.

(*1) Items recorded in the Liabilities Section are shown inparenthesis.

(*2) Receivables and payables arising from derivativetransactions are recorded in net amounts, and if the total
net amount is a negative amount, such amount is shownin parenthesis.

(*2) Receivables and payables arising from derivativetransactions are recorded in net amounts, and if the total
net amount is a negative amount, such amount is shownin parenthesis.

(Note 1) Methods to calculate fair value of financial(Note 1) Methods to calculate fair value of financial
instruments.
instruments.
(1) Cash and bank deposits (2) Cash and bank deposits in trust (1) Cash and bank deposits (2) Cash and bank deposits in trust(3) Short-term loans(3) Short-term loans
Due to the short maturities, the book value of these instruments Due to the short maturities, the book value of these instruments
is deemed a reasonable approximation of the fair value, and is deemed a reasonable approximation of the fair value, andtherefore, the book value is used as the fair value.
therefore, the book value is used as the fair value.
(4) Current portion of long-term loans payable (6) Long-termloansLong-term loans with floating interest rates reflecting changes
in market rates within a short-term period is stated at their bookvalue as their book value approximate their fair value.

(4) Current portion of long-term loans payable (6) Long-termloansLong-term loans with floating interest rates reflecting changes
in market rates within a short-term period is stated at their bookvalue as their book value approximate their fair value.

(5) Investment corporation bonds
Fair value is calculated using a method based on market price.

(5) Investment corporation bonds
Fair value is calculated using a method based on market price.

(7) Derivatives(a) Derivatives transactions to which hedge accounting is
not applied
Not applicable(b) Derivatives transactions to which hedge accounting isappliedThe contract amount as of the closing date under eachhedge-accounting method and the amount equivalent
to the notional principal prescribed in the contracts are(7) Derivatives(a) Derivatives transactions to which hedge accounting is
not applied
As for derivative transactions for which hedge
accounting is not applied, the contract amount as of theclosing date and the amount equivalent to the notional
principal prescribed in the contract are as follows.

- 74 -

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)as shown below.
(Unit: JPY thousand)(Unit: JPY thousand)Contract amount, etc.
Method of Derivativehedge

transaction

accounting

type, etc.

Primary(*1)
Amount due

hedged item

after

Fair value(*2)

Derivative

Contract amount, etc.
Amount due

Classification transaction

after

type, etc.

one year

Borrowings

95,112,000 66,133,000

64,609(OptionCurrency
optionmethodOTC

fees)transaction

Currency

fees)
Currency
optiontransaction

Scheduledforeign

3,836,140

622,160(Optionfees)(- 79,014)(- 46,376)(95,963)(13,687)

3,271,290

1,890,460(109,770)(70,605)(138,567)(28,797)

long
USD/Put(24,788)(Optioncurrency-fees)(*1) Estimation method for fair value

denominatedtransactions

Currency option:
Indicates fair values of option fees, etc. presented by
the correspondent financial institutions.

long
USD/Put

1,890,460

transaction

short(Option3,271,290

optiontransaction
USD/Call(30,162)

short
USD/Callrate/payaccounting(- 48,852)

optiontransaction

fixed rate

Principle

gains/losses

Currency

swap
floating

Valuation(*1)

one yearInterest rate
Receive

Fair value

3,836,140

622,160(191,665)(38,743)(89,405)(b) Derivatives transactions to which hedge accounting isappliedThe contract amount as of the closing date undereach hedge-accounting method and the amountequivalent to the notional principal prescribed in thecontracts are as shown below.

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

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

transaction

accounting

type, etc.

Primary(*1)
Amount due

hedged item

after

Fair value(*2)

one yearInterest rate
Principle
accounting
methodswap
Receivefloating

Borrowings

98,362,000

65,133,000(65,906)

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

- 75 -

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)(Note 2) Financial instruments for which fair value isextremely difficult to value.

(Note 2) Financial instruments for which fair value isextremely difficult to value.

(Unit: JPY thousand)Book value

Category
Tenant leasehold andsecurity deposits in trust

1,765,094

Investment securities(Unit: JPY thousand)Book value

Category
Tenant leasehold andsecurity deposits in trust

17,856,387

1,749,862

Investment securities

17,856,387

Tenant leasehold and security deposits in trust have noobservable market price, and it is impracticable to estimate
reasonably their future cash flows because the repayment
dates of those deposits and the timing of the lessee’s exitfrom the property are not certain. Thus, their fair value is
not disclosed.

Tenant leasehold and security deposits in trust have noobservable market price, and it is impracticable to estimate
reasonably their future cash flows because the repayment
dates of those deposits and the timing of the lessee’s exitfrom the property are not certain. Thus, their fair value is
not disclosed.

Since quoted market prices are not available for investment
securities (preferred equity interest and TK interest), fairvalue is deemed extremely difficult to value. Thus, prices
are not subject to the disclosure of fair value.

Since quoted market prices are not available for investment
securities (preferred equity interest), fair value is deemed
extremely difficult to value. Thus, prices are not subject tothe disclosure of fair value.

(Note 3) Remaining schedule of monetary claims after theclosing date of the fiscal period(Note 3) Remaining schedule of monetary claims after theclosing date of the fiscal period

As of December 31, 2019

As of June 30, 2020
(Unit: JPY thousand)Due within
one year

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

17,924,733-

Cash and bank deposits(Unit: JPY thousand)Cash and bank deposits

10,190,672--

6,127,902--

16,318,574--

10,862,669--

Cash and bank deposits in
trust

Total

28,787,403

-

-

Total

Due after three Due after four Due after five
to four years to five years
years-

Cash and bank deposits in
trust

-

Total

-

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

Cash and bank deposits intrust

Cash and bank deposits

Due within
one year

Due after three Due after four Due after five
to four years to five years
years

-

Cash and bank deposits

-

-

-

-

-

Cash and bank deposits in
trust

-

-

-

-

-

Total

-

-

-

-

(Note 4) Repayment schedule of long-term loans and otherinterest-bearing debts after the closing date of the
fiscal period(Note 4) Repayment schedule of long-term loans and otherinterest-bearing debts after the closing date of the
fiscal period

As of December 31, 2019

As of June 30, 2020
(Unit: JPY thousand)Due within Due after one to Due after two
one year
two years to three years
2,686,000--

50,130,000

-

-

-

-

-

Long-term loans-

55,601,000

47,079,000

Total

52,816,000

55,601,000

47,079,000

Short-term loans
Current portion of longterm loans payable
Investment corporationbonds

Due within
one year(Unit: JPY thousand)Due after one Due after two
to two years to three years

880,000--

57,380,000

-

-

-

-

1,000,000

Long-term loans-

53,602,000

44,207,000

Total

58,260,000

53,602,000

45,207,000

Short-term loans
Current portion of longterm loans payable
Investment corporationbonds- 76 -

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

Due after three Due after four Due after five
to four years to five years
years
-

-

-

-

-

-

3,000,000

1,000,000

3,000,000

Long-term loans

38,582,000

32,920,000

25,176,000

Total

41,582,000

33,920,000

28,176,000

Short-term loans
Current portion of longterm loans payable
Investment corporationbonds

Due after three Due after four Due after five
to four years to five years
years
-

-

-

-

-

-

2,000,000

1,000,000

4,200,000

Long-term loans

44,964,000

40,798,000

13,437,000

Total

46,964,000

41,798,000

17,637,000

Short-term loans
Current portion of longterm loans payable
Investment corporation
bonds[Notes Related to Asset Retirement Obligations](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

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

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

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

32,321
218
32,539- 77 -

32,107
Balanceat the beginning of the period- to the acquisition of properties
Increase due
213expense
Accretion
32,321
Balanceat the end of the period

32,539217
32,756

[Notes Related to Rental Properties](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

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

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

(Unit: JPY thousand)(Unit: JPY thousand)

Use

Residences

Book value
Fair value atBalance at theBalance at the the end of the
Change during
periodbeginning of
end of thethe period
the period
period56,921,817(3,368,841)

Book value
Fair value atBalance at theBalance at the the end of the
Change during
periodbeginning of
end of thethe period
the period
period69,671,000

Residences

53,552,976(2,648,900)

50,904,075

65,438,000

4,789,956

6,150,000

Commercial
facilities

4,789,956(51,271)

4,738,684

6,120,000

80,684,352

407,240,188

482,093,260

Hotels407,240,188

14,373,376

421,613,565

470,778,826

77,280,230

465,583,121

557,914,260

Total

465,583,121

11,673,203

477,256,324

542,336,826

Commercial
facilities

4,825,236(35,280)

Hotels326,555,836

Total

388,302,890

53,552,976

Use(Note 1) Book value is the figure calculated by subtracting
amount of accumulated depreciation fromacquisition price (including acquisition-related
costs).
(Note 2) The major factors for the increase for the fiscal
period ended December 31, 2019, were acquisitionof hotels and construction work related to capital
expenditures.
(Note 3) The major factors of the decrease were sale ofresidential properties and recording of depreciation.
(Note 4) The fair value as of the end of December 30, 2019 isbased on the appraisal value or survey value
provided by Asset Research and Development Inc.,
Japan Real Estate Institute, JLL Morii Valuation &Advisory K.K., The Tanizawa Sogo Appraisal Co.,
Ltd., Daiwa Real Estate Appraisal Co., Ltd. and
CBRE, Inc. However, the sale price is deemed thefair value of City House Tokyo Shinbashi, for which
the purchase and sale agreement was entered into on
December 9, 2019.

(Note 1) Book value is the figure calculated by subtracting
amount of accumulated depreciation fromacquisition price (including acquisition-related
costs).
(Note 2) The major factors for the increase for the fiscal
period ended June 30, 2020, were acquisition of
hotels and construction work related to capital
expenditures.
(Note 3) The major factors of decrease were sale ofresidential properties and depreciation.
(Note 4) The fair value as of the end of the Reporting Period
is determined based on the appraisal value or survey
value provided by Asset Research and Development
Inc., Japan Real Estate Institute, JLL Morii
Valuation & Advisory K.K., Tanizawa Sogo
Appraisal Co., Ltd., Daiwa Real Estate Appraisal
Co., Ltd. and CBRE, Inc.
For information related to profits and losses from rental
properties in the fiscal period ended June 30, 2020, pleaserefer to “Notes to Statement of Income and Retained
Earnings.”

For information related to profits and losses from rental
properties in the fiscal period ended December 31, 2019,
please refer to “Notes to Statement of Income and Retained
Earnings.”[Notes Related to Restriction on Asset Management](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)
Not applicable.

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)
Not applicable.

- 78 -

[Notes Related to Transactions with Related Parties]
Fiscal period ended December 31, 2019 (from July 1, 2019 to December 31, 2019) (Reference)
1

Interested parties of the Asset Manager

Classification

Name

Business or occupation

Shirahama Tokutei
Investment
Mokuteki Kaisha
management business(Note 3)

Interested
party of the
Asset
Manager(Note 1)
(Note 2)
(Note 3)(Note 4)

Percentage ofvoting rights
owned
(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Account

Balance at the end of
the period(JPY thousand)(Note 1)-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

22,322,000--

Touyako Godo
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

15,543,000--

Calvis Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

11,492,000--

Yaeyama Resort
Hotel Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

9,731,000--

Saturnia Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

9,405,000--

Kawaguchiko
Tokutei Mokuteki
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

8,629,000--

HL Investments 2
Tokutei Mokuteki
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

5,524,000--

Naqua Hotel &Resorts
Management Co.,
Ltd.
(Note 3)Hotelbusiness-

Rental revenues

1,133,572

Accounts
receivable

195,942

MyStays HotelManagement Co.,
Ltd.
(Note 3)Hotelbusiness-

Rental revenues

8,084,924

Accounts
receivable

2,664,336

Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
The terms and conditions have been determined based on the Asset Manager’s internal rules and manual regarding transactions with sponsor
related parties.
Shirahama Tokutei Mokuteki Kaisha, Touyako Godo Kaisha, Calvis Tokutei Mokuteki Kaisha, Yaeyama Resort Hotel Tokutei Mokuteki
Kaisha, Saturnia Tokutei Mokuteki Kaisha, Kawaguchiko Tokutei Mokuteki Kaisha, HL Investments 2 Tokutei Mokuteki Kaisha, Naqua
Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management Co., Ltd. have no capital relationship to be disclosed with the AssetManager. However, these Tokutei Mokuteki Kaisha or the tenant and operator have received an anonymous partnership investment orinvestment through funds that are managed by affiliates of FIG (a subsidiary of SoftBank Group Corp., which is a parent company of theAsset Manager directly/indirectly owning 100% of its issued shares). Accordingly, INV treats Shirahama Tokutei Mokuteki Kaisha,
Touyako Godo Kaisha, Calvis Tokutei Mokuteki Kaisha, Yaeyama Resort Hotel Tokutei Mokuteki Kaisha, Saturnia Tokutei Mokuteki
Kaisha, Kawaguchiko Tokutei Mokuteki Kaisha, HL Investments 2 Tokutei Mokuteki Kaisha, Naqua Hotel & Resorts Management Co.,
Ltd. and MyStays Hotel Management Co., Ltd. as the equivalent to interested parties.
The purchase of trust beneficiary interests pertains to the following properties. The transaction amount is the purchase price stated in thetrust beneficiary purchase agreement, to which other expenses for acquisition, property taxes, city planning taxes and consumption taxes are
not included.

- 79 -

Classification

Name

Business or occupation

Percentage ofvoting rights
owned
(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Account-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

22,322,000--

Shirahama Tokutei
Investment
Mokuteki Kaisha
management business(Note 3)

Interested
party of the
Asset
Manager(Note 1)
(Note 2)
(Note 3)(Note 4)

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

Touyako Godo
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

15,543,000--

Calvis Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

11,492,000--

Yaeyama Resort
Hotel Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

9,731,000--

Saturnia Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

9,405,000--

Kawaguchiko
Tokutei Mokuteki
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

8,629,000--

HL Investments 2
Tokutei Mokuteki
Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

5,524,000--

Naqua Hotel &Resorts
Management Co.,
Ltd.
(Note 3)Hotelbusiness-

Rental revenues

1,133,572

Rentalreceivables

195,942

MyStays HotelManagement Co.,
Ltd.
(Note 3)Hotelbusiness-

Rental revenues

8,084,924

Rentalreceivables

2,664,336

Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
The terms and conditions have been determined based on the Asset Manager’s internal rules and manual regarding transactions with sponsor
related parties.
Shirahama Tokutei Mokuteki Kaisha, Touyako Godo Kaisha, Calvis Tokutei Mokuteki Kaisha, Yaeyama Resort Hotel Tokutei Mokuteki
Kaisha, Saturnia Tokutei Mokuteki Kaisha, Kawaguchiko Tokutei Mokuteki Kaisha, HL Investments 2 Tokutei Mokuteki Kaisha, Naqua
Hotel & Resorts Management Co., Ltd. and MyStays Hotel Management Co., Ltd. have no capital relationship to be disclosed with the AssetManager. However, these Tokutei Mokuteki Kaisha or the tenant and operator have received an anonymous partnership investment orinvestment through funds that are managed by affiliates of FIG (a subsidiary of SoftBank Group Corp., which is a parent company of theAsset Manager directly/indirectly owning 100% of its issued shares). Accordingly, INV treats Shirahama Tokutei Mokuteki Kaisha,
Touyako Godo Kaisha, Calvis Tokutei Mokuteki Kaisha, Yaeyama Resort Hotel Tokutei Mokuteki Kaisha, Saturnia Tokutei Mokuteki
Kaisha, Kawaguchiko Tokutei Mokuteki Kaisha, HL Investments 2 Tokutei Mokuteki Kaisha, Naqua Hotel & Resorts Management Co.,
Ltd. and MyStays Hotel Management Co., Ltd. as the equivalent to interested parties.
The purchase of trust beneficiary interests pertains to the following properties. The transaction amount is the purchase price stated in thetrust beneficiary purchase agreement, to which other expenses for acquisition, property taxes, city planning taxes and consumption taxes are
not included.

Property
NumberName of Property

Counterparty

D64

Hotel MyStays Sapporo Aspen

Touyako Godo Kaisha

15,543,000

D65

Art Hotel Ishigakijima

Yaeyama Resort Hotel Tokutei Mokuteki Kaisha

9,731,000

D66

Hotel MyStays Fuji Onsen Resort

Saturnia Tokutei Mokuteki Kaisha

9,405,000- 80 -

Purchase Price(JPY thousand)D67

Hotel Sonia Otaru

Shirahama Tokutei Mokuteki Kaisha

5,930,000

D68

Hotel MyStays Kanazawa Castle

Calvis Tokutei Mokuteki Kaisha

5,682,000

D69

Art Hotel Niigata Station

HL Investments 2 Tokutei Mokuteki Kaisha

5,524,000

D70

Hotel MyStays Nagoya Nishiki

Shirahama Tokutei Mokuteki Kaisha

5,197,000

D71

Hotel Nord Otaru

Shirahama Tokutei Mokuteki Kaisha

4,296,000

D72

Hotel MyStays Kagoshima Tenmonkan

Kawaguchiko Tokutei Mokuteki Kaisha

3,445,000

D73

Art Hotel Asahikawa

Shirahama Tokutei Mokuteki Kaisha

3,197,000

D74

Hotel MyStays Matsuyama

Calvis Tokutei Mokuteki Kaisha

3,098,000

D75

Hotel MyStays Sapporo Susukino

Kawaguchiko Tokutei Mokuteki Kaisha

3,059,000

D76

Hotel MyStays Sapporo Nakajima Park

Shirahama Tokutei Mokuteki Kaisha

2,118,000

D77

Hotel MyStays Sapporo Nakajima Park Annex

Shirahama Tokutei Mokuteki Kaisha

1,584,000

D78

Flexstay Inn Sakuragicho

Calvis Tokutei Mokuteki Kaisha

1,425,000

D79

MyCUBE by MYSTAYS Asakusa Kuramae

Calvis Tokutei Mokuteki Kaisha

1,287,000

D80

Hotel MyStays Kagoshima Tenmonkan Annex

Kawaguchiko Tokutei Mokuteki Kaisha

1,168,000

D81

Hotel MyStays Nayoro

Kawaguchiko Tokutei Mokuteki Kaisha

957,000

Total

282,646,000

Asset Custody Company
Classification

Asset CustodyCompany

Name

Sumitomo Mitsui
Trust Bank,
LimitedBusiness or
occupation

Banking andtrust business

Percentage ofinvestment
units owned(%)-

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Borrowing of
short-term loan
Borrowing of
long-term loan
Repayment oflong-term loan

6,563,000

Finance-related fees
(Note 2)

72,555Interest expenses(Note 2)

Account

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

Short-termloans payable

672,000

Long-termloans payable

30,788,000

Prepaid expenses

64,169Long-term
prepaid expenses

105,877

87,503 Accrued expenses

959

672,000

2,670,000(Note 1) Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
(Note 2) The terms and conditions have been determined based on actual market conditions.

- 81 -

Fiscal period ended June 30, 2020 (from January 1, 2020 to June 30, 2020)
1

Interested parties of the Asset Manager

Classification

Interested
party of the
Asset
Manager(Note 1)
(Note 2)
(Note 3)(Note 4)

Name

Business or occupation

Percentage ofvoting rights
owned
(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Account

Adria Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

10,593,000--

Heijo Tokutei
Mokuteki Kaisha(Note 3)

Investment
management business-

Purchase of trust beneficiaryinterests in real estate(Note 2)
(Note 4)

5,643,000--

Rental revenues

112,358

Rentalreceivables

Payment of property
management costs andmanagement fees (Note 2)

273,674-

Rental revenues

2,205,610

Rentalreceivables

1,834,677

Payment of property
management costs andmanagement fees (Note 2)

985,476

Accounts
payable-other

93,109Naqua Hotel &Resorts Manage-mentCo., Ltd.
(Note 3)Hotelbusiness

MyStays HotelManage-mentCo., Ltd.
(Note 3)Hotelbusiness--

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

40,124-

Consumption taxes, etc., are not included in transaction amounts, but are included in the balance at the end of the period.
The terms and conditions have been determined based on the Asset Manager’s internal rules and manual regarding transactions with sponsor
related parties.
Adria Tokutei Mokuteki Kaisha, Heijo Tokutei Mokuteki Kaisha, Naqua Hotel & Resorts Management Co., Ltd. and MyStays HotelManagement Co., Ltd. have no capital relationship to be disclosed with the Asset Manager. However, these Tokutei Mokuteki Kaisha or
the tenant and operator have received an anonymous partnership investment or investment through funds that are managed by affiliates of
FIG (a subsidiary of SoftBank Group Corp., which is a parent company of the Asset Manager directly/indirectly owning 100% of its issued
shares). Accordingly, INV treats Adria Tokutei Mokuteki Kaisha, Heijo Tokutei Mokuteki Kaisha, Naqua Hotel & Resorts Management
Co., Ltd. and MyStays Hotel Management Co., Ltd. as the equivalent to interested parties.
The purchase of trust beneficiary interests pertains to the following properties. The transaction amount is the purchase price stated in thetrust beneficiary purchase agreement, in which other expenses for acquisition, property taxes, city planning taxes and consumption taxes are
not included.

Property
NumberName of Property

Counterparty

D82

Hotel MyStays Premier Narita

Adria Tokutei Mokuteki Kaisha

10,593,000

D83

Art Hotel Morioka

Heijo Tokutei Mokuteki Kaisha

5,643,000

Total

Purchase Price(JPY thousand)

16,236,000- 82 -

2

Asset Custody Company
Classification

Asset CustodyCompany

Name

Sumitomo Mitsui
Trust Bank,
LimitedBusiness or
occupation

Banking andtrust business

Percentage ofinvestment
units owned(%)

Type of transaction

Transaction
amount(JPY thousand)(Note 1)

Borrowing of
short-term loan
Repayment ofshort-term loan
Borrowing of
long-term loan
Repayment oflong-term loan-

880,000
672,000
8,280,000
3,680,000

Account

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

Short-termloans payable

880,000

Long-termloans payable

35,388,000

Prepaid expenses

73,764

Finance-related fees
(Note 2)

81,770Long-term
prepaid expenses

139,632

Interest expenses(Note 2)99,901 Accrued expenses

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

[Notes Related to Per Unit Information](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

Net assets per unit

JPY 42,601

Net income per unit

JPY 1,910

Net income per unit is calculated by dividing net income forthe period by the daily weighted average number of investment
units issued and outstanding. Diluted net income per unit is
not stated, as there are no diluted units.
(Note)Net assets
JPYper41,125unit

JPY 39,063

JPY 40,929

Net income
JPY per
3,748
unit

JPY 1,504

JPY 70Net income per unit is calculated by dividing net income forthe period by the daily weighted average number of investment
units issued and outstanding. Diluted net income per unit is
not stated, as there are no diluted units.

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

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)
Net income for the period (JPY thousand)Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

11,638,948

4,702,073
Net income5,431,003
for the period4,363,420(JPY thousand)
2,952,688

Amounts not attributable to common unitholders(JPY thousand)Net income attributable to common units
11,638,948(JPY thousand)Average number of investment units during the
6,093,427
period (units)

Amounts not attributable to common unitholders(JPY thousand)Net income attributable to common units
4,702,073 5,431,003
4,363,420 2,952,688(JPY thousand)Average number of investment units during the
3,788,254 3,675,824
3,436,572 3,149,936
period (units)- 83 -

423,917423,917
6,096,840

[Notes Related to Significant Subsequent Events](Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

1. Sale of asset (property)
INV completed the sale of the following property on
January 15, 2020.
Property Number: A51
Sale Date

Not applicable

City House Tokyo Shinbashi: January 15, 2020

Location: Minato-ku, Tokyo

Book Value (Note 1): JPY 2,269 million

Sales Price (Note 2): JPY 4,465 million

Expected Gain on Sale (Note 3): JPY 2,043 million

Transferee: Undisclosed (Note 4)

Legal Form of Asset: Trust beneficiary interest(Note 1)
As of December 31, 2019.
(Note 2)
Sales price shows sale prices set forth in the PSA ofproperty and does not include adjustment for
property taxes or city planning taxes, or national or
local consumption taxes.
(Note 3)Gain on sale is calculated by deducting the estimatedtransfer related cost and is subject to change upon
finalization of the financial results.
(Note 4)
The name of the transferee is not disclosed, as thetransferee’s consent has not been obtained fordisclosure.
(Note 5)For an overview of the sale of asset, please refer to“Status of Investment Corporation’s Assets underManagement 3. Asset Portfolio of Real Estate, etc.”of “I. Asset Management Report” as describedabove.

2. Debt Financing
In order to fund a portion of the acquisition price for two
hotel properties (domestic real estate trust beneficiaryinterests) acquired on January 6, 2020, INV resolved thefollowing debt financing at a meeting of the Board of
Directors held on January 6, 2020, and entered into a loan
agreement on the same day.
Lender:Outstanding balance
Interest rate, etc.

::

Interest payment date:Principal repayment
methodBorrowing method
Borrowing date
Maturity date

:
:
:
:

Sumitomo Mitsui Trust Bank,
LimitedJPY 6,980 million
Base Rate (1-month JPY
TIBOR) + 0.500%, 0.300%,
0.200%The last Japanese business dayof each month before theprincipal maturity date with
January 31, 2020 as the firstpayment date, and the principal
maturity dateLump-sum repayment
Unsecured/ non-guarantee
January 6, 2020
January 6, 2025, January 6,
2023, January 6, 2021

- 84 -

(Reference) Fiscal period ended December 31, 2019(from July 1, 2019 to December 31, 2019)

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)

3. Acquisition of assets (properties)
INV completed the acquisition of the following two hotel
properties on January 6, 2020.
Property Number: D82 Hotel MyStays Premier Narita
Acquisition Date
: January 6, 2020
Acquisition Price (Note 1): JPY 10,593 million

Location: Narita-shi, Chiba

Completion Date

: May 1985

Legal Form of Asset: Trust beneficiary interest

SellerTotal Floor Area

: Adria
Tokutei
Kaisha: 36,519.70 m2

Total Leasable Area

: 36,519.70 m2

Mokuteki

Property Number: D83 Art Hotel Morioka
Acquisition Date
: January 6, 2020
Acquisition Price (Note 1): JPY 5,643 million

Location: Morioka-shi, Iwate

Completion Date

: March 1981

Legal Form of Asset: Trust beneficiary interest

SellerTotal Floor Area

: Heijo Tokutei Mokuteki
Kaisha: 16,727.08 m2

Total Leasable Area

: 16,727.08 m2(Note 1) Acquisition price is based on the purchase priceindicated in the relevant purchase agreement and does
not include acquisition-related expenses, property
taxes, city planning taxes or consumption taxes.

[Notes Related to Provision and Reversal of Allowance for Temporary Differences Adjustment](Reference) Fiscal period ended June 30, 2019(from January 1, 2019 to June 30, 2019)
Not Applicable

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)
Not Applicable[Accounting Estimates Related to Impact of Spread of COVID-19](Reference) Fiscal period ended June 30, 2019(from January 1, 2019 to June 30, 2019)
Not Applicable

Fiscal period ended June 30, 2020
(from January 1, 2020 to June 30, 2020)
Under the assumption that the impact of spread of COVID-19
gradually subsides and the business environment recovers after
the next fiscal period, INV recorded accounting estimates
involving fixed asset impairment.
Since it is difficult to accurately predict when it will subside or
the extent of the impact regarding the spread of COVID-19, thefinancial condition and business performance of INV after the
next fiscal period may be affected in case there is a change inthe spread of infection.

- 85 -

VI.

Statement of Cash Distribution(Reference) Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)I.

Unappropriated retained
earnings
II . Distributions(Distribution per unit)
III. Retained earnings (losses)
carried forward
Calculation method of
distribution amountFiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)

JPY 23,261,426,001

JPY 13,168,294,104

JPY 10,517,049,000(JPY 1,725)

JPY 420,681,960(JPY 69)

JPY 12,744,377,001

JPY 12,747,612,144

In accordance with the distribution
policy set forth in Article 17,
Paragraph 1 of the Articles ofIncorporation of INV, thedistribution amount shall be theamount which does not exceed theamount of profits but exceeds 90%of the distributable income as
defined in Article 67-15 of theSpecial Taxation Measures Act.
However, in the event that any tax
losses arise, or if no profits havebeen recorded for tax purposes due
to tax losses carried forward, thedistribution amount may be as
reasonably determined by INV.
Pursuant to this policy, INV
determined the distribution amountto be JPY 10,517,049,000 out of
net income of JPY 11,638,948,404.
Moreover, INV does not make
Excess Profit Distribution set forthin Article 17, Paragraph 4 of the
Articles of Incorporation.

In accordance with the distribution
policy set forth in Article 17,
Paragraph 1 of the Articles ofIncorporation of INV, thedistribution amount shall be theamount which does not exceed theamount of profits but exceeds 90%of the distributable income as
defined in Article 67-15 of theSpecial Taxation Measures Act.
However, in the event that any tax
losses arise, or if no profits havebeen recorded for tax purposes due
to tax losses carried forward, thedistribution amount may be as
reasonably determined by INV.
Pursuant to this policy, INV
determined the distribution amountto be JPY 420,681,960 out of net
income of JPY 423,917,103.
Moreover, INV does not make
Excess Profit Distribution set forthin Article 17, Paragraph 4 of the
Articles of Incorporation.

- 86 -

Note
Accompanying English financial information, comprising Balance Sheet, Statement of Income and Retained
Earnings, Statement of Changes in Net Assets, Notes to financial statements and Statement of Cash Distribution,
have been translated from the Japanese financial statements of INV prepared in accordance with the Act on
Investment Trusts and Investment Corporations of Japan.
Under Article 130 of the Act on Investment Trusts and Investment Corporations of Japan, the Japanese financial
statements for the six months ended June 30, 2020 have been audited by Ernst & Young ShinNihon LLC, in
accordance with auditing standards generally accepted in Japan. However, English translation of the Japanese
language report of independent auditors is not attached herein since the accompanying English translation ofBalance Sheet, Statement of Income and Retained Earnings, Statements of Changes in Net Assets, Notes tofinancial statements and Statement of Cash Distribution is unaudited.
Regarding the English audited financial statements, please refer to the “Audited Financial Statements” on thewebsite of Invincible Investment Corporation: https://www.invincible-inv.co.jp/en/ir/library.html- 87 -

VII. Statement of Cash Flows (Reference Information)

Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)
Cash flows from operating activities
Net income before taxes
Depreciation and amortization
Loss on reduction entry of non-current assets
Investment unit issuance costs
Amortization of investment corporation bond issuance costs
Loan-related costs
Interest income
Interest expenses
Foreign exchange losses (gains)
Loss (gain) of derivatives
Increase (decrease) in allowance for doubtful accounts
Decrease (increase) in rental receivables
Decrease (Increase) in deposits paid
Decrease (increase) in receivable income taxes
Decrease (increase) in consumption taxes receivable
Increase (decrease) in accounts payable
Increase (decrease) in consumption taxes payable
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in deposits received
Decrease in property and equipment in trust due to sale
Others, net
SubtotalInterest income received
Interest expenses paid
Income taxes paid
Net cash provided by operating activities
Cash flows from investing activities
Purchases of property and equipment
Purchases of property and equipment in trust
Purchases of leasehold rights in trust
Repayments of tenant leasehold and security deposits in trust
Proceeds from tenant leasehold and security deposits in trust
Payment of tenant leasehold and security deposits
Other, net
Net cash used in investing activities
Cash flows from financing activities
Proceeds from short-term loans payable
Repayments of short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of investment corporation bonds
Borrowing related expenses
Payment of distributions of earnings
Proceeds from issuance of investment units
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 88 -(Unit: JPY thousand)Fiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)

11,639,553
3,757,778
143,0294,256
412,550(179)
702,863(32,090)(148)(344,338)(110,785)
31,539(2,426,511)(36,363)(2,577,357)(29,060)(92,670)(12,896)(199,247)
2,991,980(148,847)
13,673,054
179(701,225)(605)
12,971,404

424,522
3,999,589
73,1195,928
362,534(114)
728,828
9,864(47,743)2,798,340
219,998
7,942
1,594,835(13,390)(187,039)
163,143(1,411)
546,581(20,238)
2,269,720
726,442
13,661,453
114(729,698)(605)
12,931,264(543,104)(83,576,781)(440,504)(48,255)
67,02228,651(84,512,972)(458,135)(16,523,212)(1,387,263)(56,966)
42,113(559,000)
43,852(18,898,611)

2,686,000
61,775,000(37,061,000)
2,971,665(839,086)(9,144,041)
24,340,740
44,729,277(13)(26,812,304)
55,599,707*1 28,787,403

880,000(2,686,000)
19,583,000(14,683,000)
1,184,469(265,553)(10,514,410)(6,501,494)(13)(12,468,828)
28,787,403
16,318,574*1

(Note) Statement of cash flows is prepared based on the Regulation on the Terminology, Forms, and Preparation Methods ofFinancial Statements (Ministry of Finance Order No. 59 of 1963, as amended) and attached as reference. This statementof cash flows is not subject to audit by an auditor pursuant to the Article 130 of the Investment Trust Act, and thus has notbeen audited by an auditor.

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

Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)
Cash and cash equivalents as stated in
the Statement of Cash Flows consistof cash on hand and cash in trust,
floating deposits, deposits in trust andshort-term investments that are veryliquid and realizable with a maturityof three months or less whenpurchased and that are subject toinsignificant risks of changes invalue.

Fiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)
Cash and cash equivalents as stated in
the Statement of Cash Flows consistof cash on hand and cash in trust,
floating deposits, deposits in trust andshort-term investments that are veryliquid and realizable with a maturityof three months or less whenpurchased and that are subject toinsignificant risks of changes invalue.

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

Fiscal period ended
December 31, 2019(from July 1, 2019 to
December 31, 2019)(As of December 31, 2019)(Unit: JPY thousand)Cash and bank
17,924,733
deposits
Cash and bank
10,862,669
deposits in trust
Cash and cash
28,787,403
equivalents- 89 -

Fiscal period ended
June 30, 2020
(from January 1, 2020 toJune 30, 2020)(As of June 30, 2020)(Unit: JPY thousand)Cash and bank
10,190,672
deposits
Cash and bank
6,127,902
deposits in trust
Cash and cash
16,318,574
equivalents

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

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

Unitholders whose investment units are managed in brokerage accounts
Each brokerage
Unitholders who have no brokerage accountTransfer Agent Department, Sumitomo Mitsui Trust Bank, Limited
Toll-free Telephone Number 0120-782-031- 90 -Domestic Portfolio Map (As of June 30, 2020)

No. of Properties(Note 1)

146

Others(Note 1)

No. ofResidential
Properties

84

60

2

No. ofHotels(Note 1) Including overseas assets.
(Note 2) For properties corresponding to the number and their overview,please refer to pages 32-39.

- 91 -

- 92 -

Financial Conditions
As it is difficult to expect that the outbreak of COVID-19 will come to an end soon, in the short term INV will
implement initiatives that restrict an increase in interest payments on refinancing of existing borrowings andensure refinancing. Over the medium to long term, INV will implement financial strategies such as reductionof borrowing costs, extension of average interest-bearing debt repayment period, diversification of loan maturity
dates and financing measures.

◼ Investment Corporation Bonds
Bonds name

IssuedDate

Term(years)Balance(JPY mn)

AnnualInterest Rate

Rating

1st Series Investment
Corporation Bonds

May 25, 2018

5.0

1,000

0.40%

A+ (JCR)

2nd Series Investment
Corporation Bonds

May 25, 2018

10.0

1,000

0.80%

A+ (JCR)

3rd Series Investment
Corporation Bonds

Oct. 12, 2018

5.0

2,000

0.55%

A+ (JCR)

4th Series Investment
Corporation Bonds

Oct. 28, 2019

5.0

1,000

0.48%

A+ (JCR)

5th Series Investment
Corporation Bonds

Oct. 28, 2019

10.0

2,000

0.90%

A+ (JCR)

6th Series Investment
Corporation Bonds

Mar. 13, 2020

10.0

1,200

0.85%

A+ (JCR)

Total

8,200

◼ Lender Formation (as of August 31, 2020)- 93 -

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

Rating Object

RatingOutlookJapan Credit Rating
Agency, Ltd.

Long-term
Issuer Rating

A+

Stable(Note 1)

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

- 94 -

Overview of Unitholders/Investment Units
Historical Unit Price(Note)

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

.

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

- 95 -

Annual Schedule- 96 -

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

Correspondence(Telephone Assistance)

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

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

- 97 -

Notification(Notice of Dividend Payment)
The 2008 amendment of the Special Taxation Measures Law (Act No. 23 of April 30, 2008) mandated thesending to unitholders a “Notice of Dividend Payment” stating the dividend amount, amount of taxes withheld,
and the like for dividends payable in and after January 2009. If you collect dividends via a “Dividends Receipt,”
please view the “Notice of Dividend Payment” sent alongside it. If you have specified a wire transfer, the“Dividend Statement” delivered with the dividend payment is the “Notice of Dividend Payment.”(Characters for Addresses and Names of Unitholders)With the digitization of investment securities, if there are Chinese characters in your address or names that theJapan Securities Depository Center (JASDEC) has not included in the transfer system, JASDEC registers themin the Investors’ Registry by converting part or all of the characters to those that JASDEC has included in thetransfer system or to katakana. Please be aware that correspondence may be addressed using characters that
JASDEC has included in the transfer system. Please inquire with your brokerage regarding charactersregistered for your address and name.
Inquiries
For inquiries regarding INV: Consonant Investment Management Co., Ltd.
TEL: 03-5411-2731 (Main)
Weekdays 9:00-17:00- 98 -