Provisional translation only
April 14, 2023

EARNINGS BRIEFING FOR THE PERIOD ENDED FEBRUARY 2023
Name of issuer:
Code number:
URL:
Stock listings:

Fukuoka REIT Corporation (FRC)8968
https://www.fukuoka-reit.jp/en/
Tokyo Stock Exchange and Fukuoka Stock Exchange

Representative:

Zenji Koike

Asset manager:
Representative:
Contact:

Fukuoka Realty Co., Ltd.
Zenji Koike
President and CEO
Keishi Tamura
General Manager of Planning Dept.
Phone: +81-92-272-3900

Executive Director

Expected date for submitting securities report:
Expected commencement date of dividend payments:
Supplementary documents for earnings briefing:
Analyst meeting (for institutional investors and analysts):

May 30, 2023
May 18, 2023
Yes
Yes
(Figures rounded down to nearest mm yen)

1. Performance and situation of assets for the period ended February 2023
(September 1, 2022 to February 28, 2023)(1) Performance
Operating revenues
mm of yen

Period ended

February 2023
Period ended

August 2022

%

2,849

1.6

8,830

2.0

3,181

(0.1)

2,805

(0.4)

2,804

(0.4)

Return on net assets

Ratio of ordinary income Ratio of ordinary income
to total assets
to operating revenues

3,580 yen

2.8%

1.4%

31.5%

3,523 yen

2.8%

1.4%

31.8%

Total
dividend(excl. dividendin excess ofearnings)

Dividendin excess ofearnings
per unit

Total
dividendin excess ofearnings

Dividend
per unit(incl. dividendin excess ofearnings)

Total
dividend(incl. dividendin excess ofearnings)

3,580 yen 2,849 mm yen 100.0%

2.8%

3,523 yen 2,804 mm yen— yen — mm yen

3,523 yen 2,804 mm yen 100.0%

2.8%

February 2023
Period ended

August 2022

Ratio of net assets tototal assets

Net assets per unit

101,788 mm yen

50.5%

127,875 yen

101,743 mm yen

50.6%

127,818 yen

Total assets

Net assets

201,442 mm yen
201,223 mm yen(4) Cash flows condition
Cash flows fromoperating activities

Period ended

August 2022

assets— yen — mm yen

Period ended

February 2023

Ratio of

Payout dividend
to netratio

3,580 yen 2,849 mm yen(3) Financial condition

Period ended%

1.6(excl. dividendin excess ofearnings)

August 2022

mm of yen

2,851

August 2022

Period ended

Profit%1.3

Period ended

February 2023

Ordinary income

mm of yen

3,223

February 2023

Period ended%

2.3

Period ended

Dividend
per unit

mm of yen(% shows percentage change from previous period)

9,037

Profit per unit

(2) Dividends

Operating income

Cash flows frominvesting activities

Cash flows fromfinancing activities

Balance of cash andcash equivalents at
end of period

4,688 mm yen(117) mm yen(2,803) mm yen

10,255 mm yen

4,712 mm yen(5,498) mm yen(1,314) mm yen

8,488 mm yen

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

2. Forecast of performance for the period ending August 2023 (March 1, 2023 to August 31,2023) and the period ending February 2024 (September 1, 2023 to February 29, 2024)(% shows percentage change from previous period)

Operating revenues Operating income

Period ending

August 2023
Period ending

February 2024

Ordinary income

ProfitDividend
per unit

Dividendin excess ofearnings
per unit

mm of yen%

mm of yen%

mm of yen%

mm of yen(excl. dividend% in excess ofearnings)

9,200

1.8

3,253

0.9

2,866

0.6

2,865

0.5 3,600 yen

— yen

9,280

0.9

3,323

2.2

2,866

—

2,865

— 3,600 yen— yen(Reference) Forecast profit per unit: Period ending August 2023
Forecast profit per unit: Period ending February 2024

3,600 yen
3,600 yen

3. Others(1) Changes in accounting policies, changes in accounting estimates and restatement of accounting errors(i) Changes in accounting policies accompanying amendments to accounting standards, etc.: No(ii) Changes in accounting policies other than above (i):No
(iii) Changes in accounting estimates:No(iv) Restatement of accounting errors:No(2) Number of investment units outstanding(i) Number of investment units outstanding at end of period (including treasury investment units):
As of February 2023
796,000 units
As of August 2022
796,000 units(ii) Treasury investment units at end of period:
As of February 2023
0 unitAs of August 2022
0 unitNote: Regarding the number of investment units, a basis for calculating profit per unit, please refer to “Per unit information” on page12.

* Statement on Implementation Status of Audit Procedure
This Earnings Briefing (“Kessan Tanshin” in Japanese) report is not subject to audit procedures by public
accountants or audit corporations.
* On the adequate use of performance forecasts and other items warranting special mention
Forecast figures are calculated based on information available on the date of release of the forecast and contain
uncertain factors to a large extent. Actual operating revenues, operating income, ordinary income, profit, anddividend per unit may differ due to changes in the business environment. The forecast should not be construed
as a guarantee of actual dividend. Concerning details of the preconditions for the above forecast figures pleaserefer to “1. Management Situation, (2) Forecast for the next fiscal period – Preconditions for the performance
forecast for the period ending August 2023 (March 1, 2023 to August 31, 2023) and the period ending February
2024 (September 1, 2023 to February 29, 2024)” on page 4.

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

1. Management Situation(1) Summary of the current fiscal period(a) Brief history of the investment corporation
Fukuoka REIT Corporation (hereinafter “FRC”) was established on July 2, 2004 based on the “Act on Investment
Trusts and Investment Corporations” (Act No. 198 in 1951 including later revisions) and listed on the Tokyo Stock
Exchange, Inc. and the Fukuoka Stock Exchange on June 21, 2005 as the nation’s first real estate investment
trust specializing in regional properties (code number: 8968). FRC invests in real estate throughout all of Kyushu(including Okinawa Prefecture) with a central focus on Fukuoka City and Yamaguchi Prefecture (hereinafter the“Fukuoka/Kyushu area”) by turning regional characteristics in the real estate industry into strengths.
FRC started asset management activities on November 9, 2004 after acquisition of four properties comprisingretail properties and an office building, and manages a total of 33 properties comprising 11 Retail, 11 Officebuildings (including land with leasehold interest for an office building) and 11 Others as of the end of the 37th
fiscal period (February 28, 2023).
(b) Investment environment and portfolio performance
During the fiscal period under review (the 37th fiscal period), the Japanese economy showed a mild pickup trend
despite weakness seen in some areas. Although COVID-19 still casts an impact, the economy is expected to keep
improving due in part to the effects of various political measures. However, with monetary tightening and othermeasures continuing globally, a downturn in overseas economies poses a risk of placing downward pressure on
the domestic economy. In addition, full attention should be paid to the impacts of rising prices, restrictions on the
supply side and changes in the financial and capital markets, etc.
In the Fukuoka and Kyushu area, the core investment target area for FRC, the economy has picked up, with theemployment situation improving moderately despite production activities remaining flat. As we foresee, we mustbe fully wary of rising raw materials and other prices, overseas financial and economic trends, COVID-19
situations and the restrictions on the supply side.
As for land price trends, according to the 2023 Land Market Value Publication, the combined average price forresidential and commercial land as well as residential land price and commercial land price increased for thesecond consecutive year, respectively, on a national basis. Meanwhile, in Fukuoka City, the central area of FRC’s
investment targets, land prices rose 10.6% year-on-year for commercial land and 8.0% year-on-year forresidential land.
Under such circumstances, FRC’s portfolio achieved solid performance across all asset types. Among them,
Canal City Hakata, a city-center retail property, in particular is on a recovery track as the impact of COVID-19 has
faded and the movement of people has resumed driven by tourism demand and other factors.
In the 37th fiscal period, FRC conducted disposition of Kurume Higashi Kushiwara SC (15% co-ownershipinterest) on February 28, 2023.
When analyzing FRC’s portfolio (on an acquisition price basis) as of the end of the 37th fiscal period by investment
target area, the investment ratio in the Fukuoka metropolitan area accounted for 77.2%; when analyzing byproperty type, Retail, Office buildings, and Others accounted for 53.0%, 33.0% and 14.0%, respectively.
Fukuoka Realty Co., Ltd. to which FRC entrusts its asset management (the Asset Manager) has established theSustainability Policy and Regulations Concerning Sustainability Management to promote sustainability throughenvironmental, social and governance (ESG) considerations. In the 37th fiscal period, FRC has been newly
granted certification of the CASBEE for Building Certification for two of its owned properties. In terms of external
certifications, FRC has acquired either DBJ Green Building Certification, CASBEE for Building Certification or
BELS Evaluation for 80.0% of its portfolio properties on a total floor space basis.
(c) Summary of fundraising
The balance of FRC’s interest-bearing debt outstanding (including investment corporation bonds) at the end of
the 37th fiscal period totaled 83,900 mm yen. The loan-to-value ratio (ratio of interest-bearing debt (including
investment corporation bonds) to total assets) was 41.6% and the ratio of fixed-interest rate debt (ratio of fixedinterest rate debt (including investment corporation bonds) to total interest-bearing debt) stood at 93.4% at theend of the 37th fiscal period. In addition, with regard to the commitment line agreement (credit limit: 7,000 mmyen) with The Nishi-Nippon City Bank, Ltd. serving as the agent, FRC extended the commitment period by a year,
lengthening the remaining term of commitment to three years. FRC will continue its endeavors to reducerefinancing risks by dispersing debt repayment dates and other measures. At the same time, FRC will investigate
mitigating the possible increase in financing costs in accordance with higher interest rates going forward, including
review of the ratio of fixed-interest rate debt.
Moreover, the credit ratings assigned to FRC as of the end of the 37th fiscal period are as follows.
Credit Rating Agency
Rating and Investment Information, Inc. (R&I)
Japan Credit Rating Agency, Ltd. (JCR)

Rating Type
Issuer Rating
Long-term Issuer Rating

1

RatingA+
AA−

Rating Outlook
StableStableFukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(d) Summary of performance and dividend
As a result of these management efforts, operating revenues totaled 9,037 mm yen and operating income after
excluding operating expenses such as expenses related to leasing business and asset management fees totaled
3,223 mm yen. Ordinary income was 2,851 mm yen and profit amounted to 2,849 mm yen. Management decided
to make a dividend of 3,580 yen per unit to meet the requirements of special tax measures for an investment
corporation (as stipulated in Article 67-15 of the Act on Special Measures Concerning Taxation of Japan [Act No.
26 in 1957 including later revisions]). Under this act, an investment corporation is allowed to deduct the maximum
amount of dividends paid to investors from its taxable income.
(2) Forecast for the next fiscal period(a) Portfolio management policy
FRC will further reinforce management and leasing capabilities by cooperating with property managementcompanies including sponsor companies, and secure and maintain the stable operation of the properties bymaking the most use of their advantages.
FRC will make investments based on the basic policy stipulated in its Articles of Incorporation and its basic
philosophy: focusing on “specialized areas in which FRC can demonstrate its competitive edge” that are in “highgrowth potential markets.” By geographic location, of Fukuoka and Kyushu areas, FRC will invest 60% to 90%
of its assets in the Fukuoka metropolitan area since the Fukuoka metropolitan area is expected to have a highpopulation growth rate in the future. In addition to the Fukuoka metropolitan area, management has decided toactively acquire properties in major cities if there are regions or properties where FRC can generate investment
merits from community-oriented viewpoints. FRC will acquire high-quality properties with adequate use of its
advantages, such as information gathering ability in the areas, good knowledge of regional properties and close
relations with the local business community including its sponsors and governments, so that investors cancontinue to invest in FRC with assurance. Meanwhile, FRC will build stronger relationships with financial
institutions to realize stable fundraising and try to maintain a solid financial structure.
(b)

Significant events that have occurred after the end of the current fiscal period:
No relevant items.

(Reference information)
Acquisition of AssetOn March 28, 2023, FRC acquired the following real estate.
Type of asset acquired:
Property name:
Use:
Location:
Seller:Acquisition price:
Acquisition date:

Real estate
Kumamoto East Front Building
Office building
1-5-15, Shinyashiki, Chuo Ward, Kumamoto City and 2 other lots
Not disclosed (Note 1)
1,450 mm yen (Note 2)
March 28, 2023

(Note 1) The seller is a domestic operating company but is not disclosed as no consent to disclosure has been obtained
from the seller. Note that the seller does not fall under the category of related parties of FRC or Fukuoka Realty Co.,
Ltd., the asset management company of FRC.
(Note 2) The acquisition price does not include acquisition expenses and the amount equivalent to the settlement of property
taxes and city planning taxes, etc.

On March 30, 2023, FRC concluded a sales agreement regarding acquisition of real estate trust beneficiaryinterest.
Type of asset to be acquired:
Property name:
Use:
Location:
Seller:Acquisition price (planned):
Acquisition date (planned):

Real estate trust beneficiary interest (Note 1)
Hakata FD Business Center
Office building
10 Tsunabamachi, Hakata Ward, Fukuoka City and 13 other lots
Fukuoka Jisho Co., Ltd.
14,100 mm yen (Note 2)
September 1, 2023

(Note 1) Although the asset to be acquired is actual real estate as of the contract date, the seller plans to place 77% coownership interest in the property’s building it owns and the land it owns (part of the building’s leasehold land; socalled “partial ownership”) in a trust for the trustee by the acquisition date (planned), and FRC plans to acquire thebeneficiary interest in said trust.
(Note 2) The acquisition price (planned) does not include acquisition expenses and the amount equivalent to the settlementof property taxes and city planning taxes, etc.
(Note 3) The beneficiary interest disposition agreement for the acquisition of the property (the "Acquisition Agreement") falls
under the category of forward commitment, etc. (a postdated transaction agreement where the settlement anddelivery are to take place one month or more after the conclusion of the agreement as well as other similar
agreements). FRC shall be able to cancel the Acquisition Agreement without penalty if it becomes impossible toachieve the purpose of the agreement due to a cause not attributable to FRC. In the Transaction Agreement FRC
will not pay any deposit.

2

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

On March 31, 2023, FRC concluded a sales agreement regarding acquisition of real estate trust beneficiaryinterest.
Type of asset to be acquired:
Property name:
Use:
Location:
Seller:Acquisition price (planned):
Acquisition date (planned):

Real estate trust beneficiary interest (Note 1)
Axion Befu-Ekimae Premium
Residence
3-296-1, Befu, Jonan Ward, Fukuoka City and 2 other lots
Shibata Industry Co., Ltd.
1,525 mm yen (Note 2)
April 27, 2023

(Note 1) Although the asset to be acquired is actual real estate as of the contract date, the seller plans to place the property
in a trust for the trustee by the acquisition date (planned), and FRC plans to acquire the beneficiary interest in said
trust.
(Note 2) The acquisition price (planned) does not include acquisition expenses and the amount equivalent to the settlementof property taxes and city planning taxes, etc.

(c)

Performance forecast for the next fiscal period
FRC aims to achieve the following performance goals for the period ending August 2023 (March 1, 2023 toAugust 31, 2023) and the period ending February 2024 (September 1, 2023 to February 29, 2024). Concerning
preconditions for the relevant performance forecast, please refer to “Preconditions for the performance forecast
for the period ending August 2023 (March 1, 2023 to August 31, 2023) and the period ending February 2024
(September 1, 2023 to February 29, 2024)” on page 4.
Period ending August 2023
Period ending February 2024
Operating revenues
9,200 mm yen
9,280 mm yen
Operating income
3,253 mm yen
3,323 mm yen
Ordinary income
2,866 mm yen
2,866 mm yen
Profit2,865 mm yen
2,865 mm yen
Dividend per unit
3,600 yen
3,600 yen
Dividend in excess of earnings per
— yen
— yen
unit
Note:

The above forecast figures are calculated based on certain preconditions. The forecast should not be construed as aguarantee of actual performance since actual operating revenues, operating income, ordinary income, profit, dividend
per unit and dividend in excess of earnings per unit may differ due to changes in the business environment.

3

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

Preconditions for the performance forecast for the period ending August 2023 (March 1, 2023 to August 31, 2023) andthe period ending February 2024 (September 1, 2023 to February 29, 2024)
Item
Preconditions
38th fiscal period: March 1, 2023 to August 31, 2023 (184 days)
Calculation period
39th fiscal period: September 1, 2023 to February 29, 2024 (182 days)• It is assumed that, on top of the 33 properties FRC owns as of February 28, 2023, FRC will acquire
Kumamoto East Front Building on March 28, 2023 and Axion Befu-Ekimae Premium on April 27,
2023 for the 38th fiscal period, and will acquire Hakata FD Business Center on September 1, 2023
Assets under
for the 39th fiscal period.
management• FRC assumes that it will dispose part of Kurume Higashi Kushiwara SC in the 38th and 39th fiscal
periods.
• In practice, the number may fluctuate due to changes in assets under management.
Total number ofinvestment units• It is assumed that there will be no issuance of new investment units until February 29, 2024.
outstanding• The balance of interest-bearing debt outstanding at the end of the 38th fiscal period (August 31,2023) is expected to total 86,850 mm yen. The loan-to-value ratio (interest-bearing debt / total assets
× 100) is expected to stand at around 42.6% (as of February 28, 2023, the loan-to-value ratio stands
Interest-bearing debt
at 41.6%).
and refinancing• The balance of interest-bearing debt outstanding at the end of the 39th fiscal period (February 29,2024) is expected to total 98,850 mm yen. The loan-to-value ratio (interest-bearing debt / total assets
× 100) is expected to stand at around 45.7%.
• Of leasing revenues – real estate, revenues from properties FRC has already acquired are calculated
based on tenancy agreements that are valid as of April 14, 2023, by taking into account thecompetitiveness of the properties and the market environment, etc.
Of leasing revenues – real estate, revenues from lease contracts with variable rent such as
Operating revenues
percentage-of-sales rent and percentage-of-GOP rent are calculated based on past results by taking
into account such fluctuation factors as sales and GOP of the relevant tenants.
• For leasing revenues – real estate, tenant vacancies are taken into account to a certain extent. It is
assumed that there will be no rent arrears or non-payments by tenants.
• When acquiring properties, the property taxes and city planning taxes for the assets will be
proportionally calculated according to the holding period and adjusted with the former owner.
However, the adjusted amount of the property taxes and city planning taxes to be borne by FRC for
the initial year will not be written off since they will be included in the acquisition cost.
• FRC writes off estimated repair costs expected to be required for buildings for the calculation periods(the 38th and 39th fiscal periods). Actual repair costs may differ significantly from the estimatedamounts since there is the possibility that repair costs are incurred urgently due to damages tobuildings caused by unforeseeable factors, repair costs generally differ largely from period to period,
Operating expenses
and repair costs are not regularly incurred.
• Concerning outsourcing expenses, FRC anticipates 1,757 mm yen for the 38th fiscal period and1,782 mm yen for the 39th fiscal period.
• Concerning taxes and other public charges, FRC anticipates 755 mm yen for the 38th fiscal period
and 752 mm yen for the 39th fiscal period.
• Concerning depreciation and amortization expenses, FRC anticipates 1,536 mm yen for the 38th
fiscal period and 1,612 mm yen for the 39th fiscal period.
• Concerning interest expenses (including interest expenses on investment corporation bonds) andNon-operating
expenses related to financing, FRC anticipates 385 mm yen for the 38th fiscal period and 455 mm
expenses
yen for the 39th fiscal period.
• Dividend (dividend per unit) is calculated based on the dividend policy stipulated in FRC’s Articles ofIncorporation.
Dividend per unit
• Dividend per unit may fluctuate due to fluctuations in leasing revenues caused by changes in assets
under management and tenants or various factors including unexpected occurrences of repair.
Dividend in excess• Dividend in excess of earnings (dividend in excess of earnings per unit) is not planned at the moment.
of earnings per unit
• It is assumed that there will be no revisions to laws and regulations, the tax system, and accounting
standards that may influence the forecast figures.
Others• It is also assumed that there will be no significant unexpected changes in general economic
conditions and the real estate market.

4

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

2. Financial Statements(1) Balance sheet

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
OthersTotal current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Structures
Accumulated depreciation
Tools and fixtures
Accumulated depreciation
Lands
Buildings in trust
Accumulated depreciation
Structures in trust
Accumulated depreciation
Machinery and equipment in trust
Accumulated depreciation
Vehicles and transport equipment in trust

Accumulated depreciation
Tools and fixtures in trust
Accumulated depreciation
Lands in trust
Construction in progress in trust
Total property, plant and equipment
Intangible assets
Leasehold right in trust
Other intangible assets in trust
Total intangible assets
Investment and other assets(thousands of yen)

36th fiscal period

37th fiscal period(as of August 31, 2022)(as of February 28, 2023)

4,203,346
4,335,931
788,376
227,634
124,948
10,2239,690,462

1,171,821(53,781)
20,698
(709)
1,571
(430)
104,797,631(38,070,850)
1,976,251(907,404)
1,483,511(745,401)
626(594)
1,473,642(1,241,477)

1,118,039
19,9881,140
989,124
66,726,781
1,068,847
738,11031
232,165
113,715,265
7,932
184,617,427
5,545,883
8,315
5,554,198

Deferred tax assets

6,069,891
4,236,159
738,177
270,539—
16,961
11,331,729

1,181,091(68,543)
20,698
(903)
1,571
(547)
104,967,252(39,379,429)
1,974,987(931,405)
1,490,515(781,851)
626(594)
1,489,296(1,257,920)

1,112,547
19,795
1,023
989,124
65,587,822
1,043,582
708,66431
231,375
113,501,599
8,217
183,203,784
5,545,883
5,421
5,551,305

13

19

Lease and guarantee deposits

10,00010,000

Lease and guarantee deposits in trust

327,135

327,135

Long-term prepaid expenses
Total investment and other assets
Total non-current assets
Deferred assets
Investment corporation bond issuance
expenses
Total deferred assets
Total assets

5997,950

994,175

1,335,099

1,331,330

191,506,725

190,086,419

26,664

24,676

26,664

24,676201,223,852

201,442,825

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023
(thousands of yen)

36th fiscal period

37th fiscal period(as of August 31, 2022)(as of February 28, 2023)

Liabilities
Current liabilities
Operating accounts payable
Current maturities of investment
corporation bonds
Current maturities of long-term debt

661,770

662,491—

2,000,000

5,900,000

10,400,000

Accounts payable-other

16,27521,315

Accrued expenses

421,792

422,685

Income taxes payable

962

1,079

Accrued consumption taxes―

366,970

Advances received

1,084,850

1,068,121

Deposits received

1,026,223

924,435

Total current liabilities

9,111,875

15,867,098

Investment corporation bonds

5,000,000

3,000,000

Long-term debt

73,000,000

68,500,000

741,017758,476

11,627,634

11,528,307

90,368,652

83,786,783

99,480,527

99,653,881

98,938,764

98,938,764

Unappropriated surplus

2,804,559

2,850,179

Total surplus

2,804,559

2,850,179

101,743,324

101,788,943

101,743,324

101,788,943

201,223,852

201,442,825

Non-current liabilities

Tenant leasehold and security deposits
Tenant leasehold and security deposits
received in trust
Total non-current liabilities
Total liabilities
Net assets
Unitholders’ equity
Unitholders’ capital
Surplus

Total unitholders’ equity
Total net assets
Total liabilities and net assets

6

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(2) Statement of income(thousands of yen)

36th fiscal period

37th fiscal period(March 1, 2022 toAugust 31, 2022)(September 1, 2022 toFebruary 28, 2023)

Operating revenues
Leasing revenues – real estate
Other leasing revenues – real estate*1*18,160,720*1

669,929

Gain on sales of real estate—

8,830,650

8,233,996*1

687,929*2

115,438

9,037,365

Operating expenses
Expenses related to leasing business
Asset management fees

*1, *3

4,974,312*1, *3

5,147,017

534,574

534,370

Asset custody fees

7,514

7,483

Administrative service fees

60,08757,648

Director’s compensations

6,600

3,600

Other operating expenses

65,669Operating income

5,648,758

63,584

3,181,891

5,813,704
3,223,660

Non-operating revenues
Interest received

40

Others

1,191

44
1,231

991

1,035

Non-operating expenses
Interest expenses
Interest expenses on investment
corporation bonds
Amortization of investment
corporation bond issuance expenses
Financing related expenses

249,567

245,360

29,20029,200

1,172

1,988

97,744

97,103

Others37377,72237373,688

Ordinary income

2,805,401

2,851,007Profit before income taxes

2,805,401

2,851,007

Income taxes-current

968

Income taxes-deferred

38

Profit

1,085
1,007

(5)

1,080

2,804,394

2,849,927

Surplus brought forward

165

251

Unappropriated surplus

2,804,559

2,850,179

7

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(3) Statement of changes in net assets
36th fiscal period (March 1, 2022 to August 31, 2022)
Unitholders’ Equity
Surplus
Unitholders’ capital
Balance as ofMarch 1, 2022
Changes in thecurrent fiscal period

Unappropriated surplus

Totalunitholders’ equity

Total
net assets

2,814,821

101,753,586

101,753,586

Dividend of surplus(2,814,656)(2,814,656)(2,814,656)

Profit2,804,394

2,804,394

2,804,394—(10,261)(10,261)(10,261)

98,938,764

2,804,559

101,743,324

101,743,324

Total of changes in thecurrent fiscal period
Balance as ofAugust 31, 2022

98,938,764(thousands of yen)

37th fiscal period (September 1, 2022 to February 28, 2023)
Unitholders’ Equity
Surplus
Unitholders’ capital
Balance as of
September 1, 2022
Changes in thecurrent fiscal period

Unappropriated surplus

Totalunitholders’ equity

Total
net assets

2,804,559

101,743,324

101,743,324

Dividend of surplus(2,804,308)(2,804,308)(2,804,308)

Profit2,849,927

2,849,927

2,849,927—

45,61945,61945,61998,938,764

2,850,179

101,788,943

101,788,943

Total of changes in thecurrent fiscal period
Balance as ofFebruary 28, 2023

98,938,764(thousands of yen)

8

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(4) Dividend statement
Item

36th fiscal period(March 1, 2022 toAugust 31, 2022)

37th fiscal period(September 1, 2022 toFebruary 28, 2023)

I.

Unappropriated surplus

2,804,559 thousand yen

2,850,179 thousand yen

II.

Total dividend

2,804,308 thousand yen

2,849,680 thousand yen[Dividend per investment
unit][3,523 yen]

[3,580 yen]

III. Surplus brought forward

251 thousand yen

499 thousand yen

Method for calculating dividends

The amount of dividends shall be decided in The amount of dividends shall be decided inaccordance with the dividend policy accordance with the dividend policy
stipulated in Article 38-1-2 of FRC’s Articles stipulated in Article 38-1-2 of FRC’s Articles
of Incorporation and must exceed 90% of of Incorporation and must exceed 90% of
FRC’s distributable profits as stipulated in FRC’s distributable profits as stipulated in
Article 67-15-1 of the Special Taxation Article 67-15-1 of the Special Taxation
Measures Act. Following the above policy, Measures Act. Following the above policy,
FRC shall decide to distribute 2,804,308 FRC shall decide to distribute 2,849,680
thousand yen, which is almost the entire thousand yen, which is almost the entire
amount of unappropriated surplus, as amount of unappropriated surplus, asearnings dividends. Moreover, dividend in earnings dividends. Moreover, dividend inexcess of earnings as stipulated in Article excess of earnings as stipulated in Article38-2 of FRC’s Articles of Incorporation will 38-2 of FRC’s Articles of Incorporation will
not be provided.
not be provided.

(Note) Amounts other than the amounts of dividend per investment units are rounded down to the nearest thousand yen.

9

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(5) Cash flows statement(thousands of yen)

36th fiscal period(March 1, 2022 toAugust 31, 2022)

Net cash provided by (used in) operating activities
Profit before income taxes
Depreciation and amortization expenses
Amortization of investment corporation bond issuance
expenses
Interest received
Interest expenses
Gain on sales of real estate
Decrease (increase) in operating accounts receivables
Decrease (increase) in consumption taxes refund receivable
Increase (decrease) in accrued consumption taxes
Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable-other
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in deposits expenses
Decrease (increase) in prepaid expenses
Decrease (increase) in long-term prepaid expenses
Others, net
SubtotalInterest income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investment activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment in trust
Purchase of property, plant and equipment in trust
Proceeds from tenant leasehold and security deposits
Repayments of tenant leasehold and security deposits
Proceeds from tenant leasehold and security deposits in trust
Repayments of tenant leasehold and security deposits in trust
Proceeds from restricted trust deposits
Payments for restricted trust deposits
Net cash provided by (used in) investment activities
Net cash provided by (used in) financial activities
Proceeds from short-term debt
Repayments of short-term debt
Proceeds from long-term debt
Repayments of long-term debt
Dividends paid
Net cash provided by (used in) financial activities
Net increase (decrease) in cash and cash equivalents
Balance of cash and cash equivalents at beginning of period
Balance of cash and cash equivalents at end of period

1037th fiscal period(September 1, 2022 toFebruary 28, 2023)

2,805,401
1,514,524

2,851,007
1,499,723

1,172

1,988

(40)
278,767—(176,146)
92,727—73,784(6,115)
4,057
77,805
329,077
26,658(32,961)
1,417
4,990,13240(275,746)(1,665)
4,712,760(44)274,560(115,438)
50,199124,948366,970
59,0304,919
3,459(16,729)(101,788)(42,905)
3,774
2,479
4,966,156
44(277,126)(969)
4,688,104(493)—(5,911,512)
290,149(90)
309,878(183,714)
3,634(6,099)(5,498,246)—
407,974(443,750)
142,690(125,232)
55,365(154,691)
6,387(6,347)(117,604)

4,000,000(4,000,000)
7,500,000(6,000,000)(2,814,517)(1,314,517)(2,100,003)
10,588,484
8,488,481————(2,803,686)(2,803,686)
1,766,813
8,488,481
10,255,294

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(6) Notes on the going concern assumption
No relevant items.
(7) Significant accounting policies
Disclosure is omitted, since there are no significant changes from contents disclosed by the latest securities report(submitted on November 28, 2022).
(8) Notes to financial statements
FRC omits the disclosure of notes to balance sheet, statement of changes in net assets, and cash flows statement,
as well as notes on lease transactions, financial instruments, securities, derivative transactions, related-party
transactions, tax-effect accounting, retirement benefits, asset retirement obligations, rental properties, revenue
recognition, segment information and equity method income, etc. since it does not find substantial need for disclosurein the earnings briefing.
(Notes to statement of income)*1. Breakdown of revenues and expenses related to real estate leasing business(thousands of yen)

36th fiscal period(March 1, 2022 toAugust 31, 2022)

37th fiscal period(September 1, 2022 toFebruary 28, 2023)

A. Real estate leasing business revenues
Leasing revenues – real estate
Rents

6,784,821

6,864,849

Common charges

934,731

917,441

Parking revenues

441,168

8,160,720

451,706

8,233,996

Other leasing revenues – real estate
Incidental income

649,178

Other miscellaneous income

20,750Total real estate leasing business revenues

650,853
669,929

37,0768,830,650

687,929
8,921,926

B. Expenses related to real estate leasing business
Expenses related to leasing businessOutsourcing fees

1,740,908

1,746,745

Repair and maintenance expenses

119,524

266,909

Taxes and other public charges

719,695

719,446

Insurance premiums and trust compensation

42,66941,241

Utilities expenses

544,853

579,433

1,514,524

1,499,723

Depreciation and amortization expenses
Other expenses related to real estate leasing
business
Total expenses related to real estateleasing business
C. Revenues and expenses related to real estateleasing business (A - B)

292,136*2. Breakdown of gain on sales of real estate

36th fiscal period (March 1, 2022 to August 31, 2022)
Not applicable.
37th fiscal period (September 1, 2022 to February 28, 2023)
Kurume Higashi Kushiwara SC (15% co-ownership interest)
Proceeds from sales of real estate
Costs of sale of real estate
Other selling expenses
Gain on sales of real estate(thousands of yen)

411,000
292,535
3,025
115,438

11

4,974,312

293,516

5,147,017

4,974,312

5,147,017

3,856,337

3,774,909

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

*3. Transactions with affiliated companies(thousands of yen)

37th fiscal period

36th fiscal period(March 1, 2022 toAugust 31, 2022)

Expenses related to real estate leasing business(September 1, 2022 toFebruary 28, 2023)

839,311

909,403(Per unit information)
36th fiscal period

37th fiscal period(March 1, 2022 to August 31, 2022)

Net assets per investment unit:
Profit per investment unit:(September 1, 2022 to February 28, 2023)

127,818 yen
3,523 yen

Net assets per investment unit:
Profit per investment unit:

127,875 yen
3,580 yen

Note 1: Profit per investment unit is calculated by dividing profit by the day-weighted average number of investment units
outstanding during the fiscal period. Diluted profit per investment unit is not shown since there are no potential
investment units.
Note 2: Calculation of profit per investment unit is based on the following.

37th fiscal period

36th fiscal period(March 1, 2022 toAugust 31, 2022)

Profit (thousands of yen)Amount not attributable to common unitholders(thousands of yen)
Profit attributable to common investment units(thousands of yen)
Average number of investment units during the fiscal
period (units)(Significant subsequent events)
No relevant items.
(9) Change in the number of investment units outstanding
No relevant items.

12(September 1, 2022 toFebruary 28, 2023)

2,804,394

2,849,927——

2,804,394

2,849,927

796,000

796,000

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

3. Reference Information(1) Information on the prices, etc. of investment assets
1) Investment situation
Type ofasset

Total value of
properties owned

Location

Use

Real estate(as of February 28, 2023)(Note 1)(mm of yen) (Note 2)(%) (Note 3)

RetailFukuoka
metropolitan area——

Other Kyushu areas——

Office buildings

Fukuoka
metropolitan area——

Other Kyushu areas——

OthersFukuoka
metropolitan area

—

—

2,122

1.1

2,122

1.1

Other Kyushu areas
Subtotal

Real estatein trust

Percentage of
total assets

RetailFukuoka
metropolitan area

66,373

32.9

Other Kyushu areas

36,522

18.1

Office buildings

Fukuoka
metropolitan area

59,021

29.3——

OthersFukuoka
metropolitan area

19,535

9.7

Other Kyushu areas

5,171

2.6

186,624

92.6

12,695

6.3

201,442100.0[188,755][93.7]

Other Kyushu areas

Subtotal
Deposits and other assets
Total amount of assets (Note 4)

Note 1: “Fukuoka metropolitan area” refers to cities, towns and villages where 10% or more of the population commute to
Fukuoka City for school and work, according to the 2020 census, which states “the number of workers and students aged
15 years or older (students including those aged 14 years or younger: particular reference) including commuting between
their homes and places of work or school” conducted by Fukuoka City and the Statistics Bureau of the Ministry of Internal
Affairs and Communications. “Other Kyushu areas” refers to all other parts of Kyushu (excluding the Fukuoka
metropolitan area).
Note 2: “Total value of properties owned” is based on the value on the balance sheet (the value of real estate and real estate intrust is the book value after depreciation).
Note 3: Concerning the “Percentage of total assets,” the figures are rounded off to one decimal place. The total of individual
percentages in the above table may not equal 100%.
Note 4: Figures in parentheses for “Total amount of assets” refer to the value and percentage of real estate owned in effect tothe total amount of assets.
(as of February 28, 2023)

Value on balance sheet(mm of yen)

Percentage of total amount of assets(%)

Total liabilities

99,653

49.5

Total net assets

101,78850.5

13

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

2) Investment assets(A) Values and investment ratios at end of period are as follows.
Real estate property nameAcquisition
price(mm of yen)
(Note 1)

Value onbalance sheet(mm of yen)

Period-end
appraisal value(mm of yen)
(Note 2)

Canal City Hakata

32,00029,62429,500Canal City Hakata･B

21,06020,53521,800Park Place Oita

19,61020,39820,500SunLive City Kokura

6,633

5,497

8,530

Konoha Mall Hashimoto

10,000

9,934

10,100

Square Mall Kagoshima Usuki

5,300

4,217

4,710

Kumamoto Intercommunity SC

2,400

1,910

2,790

Hanahata SC

1,130

945

1,200

Kurume Higashi Kushiwara SC(Note 4)

2,125

1,657

2,337

K’s Denki Kagoshima

3,550

2,840

3,490

Marinoa City Fukuoka (Marina
Side Building)Retail subtotal:
Canal City Business Center
Building

5,250

5,332

5,860

109,058

102,895

110,817

14,60012,63018,800Gofukumachi Business Center

11,2008,615

15,600Sanix Hakata Building

4,400

3,716

6,850

Taihaku Street Business Center

7,000

5,466

9,830

Higashi Hie Business Center

5,900

4,314

8,990

Tenjin Nishi-Dori Center Building

2,600

2,640

3,310

Tenjin North Front Building

2,800

2,329

4,930

Higashi Hie Business Center II

4,230

3,861

4,790

Higashi Hie Business Center III

3,290

3,198

3,450

7,700

7,754

8,500

Tenjin Nishi-Dori Business Center(Land with leasehold interest)
Hakata Chikushi-Dori Center
Building
Office buildings subtotal:

4,320

4,491

4,550

68,04059,02189,600Amex Akasakamon Tower

2,060

1,588

2,000

City House Keyaki Dori

1,111

860

1,120

Aqualia Chihaya

1,280

1,142

2,060

D-Wing Tower

2,800

2,591

3,940

Granfore Yakuin Minami

1,100

1,055

1,390

Hotel FORZA Oita

1,530

1,306

1,900

Tissage Hotel Naha

2,835

2,739

2,910

Tosu Logistics Center

1,250

1,125

1,440

LOGICITY Minato Kashii

8,150

7,645

9,760

LOGICITY Hisayama

5,050

4,651

5,790

LOGICITY Wakamiya

1,700

2,122

2,550

Others subtotal:
Total

28,866205,964

26,830188,746

34,860235,27714(as of February 28, 2023)

Investment
ratio
(%)
(Note 3)

Real estateappraiser

Tanizawa Sogo
15.5 Appraisal Co., Ltd.
Tanizawa Sogo
10.2 Appraisal Co., Ltd.
Japan Real Estate
9.5 InstituteJapan Real Estate
3.2 InstituteTanizawa Sogo
4.9 Appraisal Co., Ltd.
Japan Real Estate
2.6 InstituteJapan Real Estate
1.2 InstituteTanizawa Sogo
0.5 Appraisal Co., Ltd.
Tanizawa Sogo
1.0 Appraisal Co., Ltd.
Tanizawa Sogo
1.7 Appraisal Co., Ltd.
Tanizawa Sogo
2.5 Appraisal Co., Ltd.

53.0

Tanizawa Sogo
7.1 Appraisal Co., Ltd.
Tanizawa Sogo
5.4 Appraisal Co., Ltd.
Japan Real Estate
2.1 InstituteJapan Real Estate
3.4 InstituteTanizawa Sogo
2.9 Appraisal Co., Ltd.
Japan Real Estate
1.3 InstituteJapan Real Estate
1.4 InstituteTanizawa Sogo
2.1 Appraisal Co., Ltd.
Tanizawa Sogo
1.6 Appraisal Co., Ltd.
Japan Real Estate
3.7 InstituteTanizawa Sogo
2.1 Appraisal Co., Ltd.

33.0

Daiwa Real Estate
1.0 Appraisal Co., Ltd.
Daiwa Real Estate
0.5 Appraisal Co., Ltd.
Japan Real Estate
0.6 InstituteTanizawa Sogo
1.4 Appraisal Co., Ltd.
Tanizawa Sogo
0.5 Appraisal Co., Ltd.
Japan Real Estate
0.7 InstituteTanizawa Sogo
1.4 Appraisal Co., Ltd.
Japan Real Estate
0.6 InstituteTanizawa Sogo
4.0 Appraisal Co., Ltd.
Tanizawa Sogo
2.5 Appraisal Co., Ltd.
Tanizawa Sogo
0.8 Appraisal Co., Ltd.

14.0
100.0

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(Real estate property to be acquired)Real estate property name
Island City Minato Bay related site
(Land with leasehold interest)(tentative) (Note 5) (Note 6)
Note 1:
Note 2:
Note 3:Note 4:Note 5:Note 6:Note 7:

Acquisition
price (planned)(mm of yen)
(Note 1)

Value onbalance sheet(mm of yen)

Period-end
appraisal value(mm of yen)
(Note 2)

8,082

-

8,210

Investment
ratio
(%)
(Note 3)

Real estateappraiser
Tanizawa Sogo
- Appraisal Co., Ltd.

“Acquisition price” and “Acquisition price (planned)” refer to the amount (purchasing prices shown on the purchasing
contracts) not including expenses for the acquisition of relevant properties (agency fees and taxes and other public charges).
“Period-end appraisal value” refers to the evaluation value based on appraisals by a real estate appraiser in conformity withthe method and standards for asset evaluation stipulated in FRC’s Articles of Incorporation and rules stipulated by theInvestment Trusts Association, Japan.
“Investment ratio” is obtained by dividing each property’s acquisition value by the total acquisition price. The total ofindividual percentages in the above table may not equal 100%, since the figures are rounded off to one decimal place.
The amounts after the disposition of Kurume Higashi Kushiwara SC (15% co-ownership interest) are indicated.
The acquisition of the property falls under the category of forward commitment, etc. as provided by the “Comprehensive
Guidelines for Supervision of Financial Instruments Business Operators, etc.” set by the Financial Services Agency. As areservation deposit, FRC paid the amount equivalent to 5% (approximately 4 mm yen) of the purchase price corresponding
to its acquisition ratio at the time of applying for purchase to the Fukuoka City Government. If FRC withdraws from thepurchase of the property, the deposit shall be used as cancellation penalty.
The property is planned for delivery on March 31, 2029 (which may be changed depending on the situation of its foundation
enhancement work and other factors).
Real estate property to be acquired indicates the property for which contract has been concluded as of the end of the 37th
fiscal period.

15

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

(B) Summary of the real estate leasing business(as of February 28, 2023)

Total
leasingrevenues(mm of yen)
(Note 4)
1,011

Percentage
of totalleasingrevenues(%) (Note 5)
11.3

29,514.59

958

10.7

120,915.19

1,216

13.6

61,450.22

293

3.3

Number oftenants(Note 1)

Occupancy
rate(%)(Note 3)Total
leasable floor
space
(m2)

Total
leased floor
space
(m2)

1 [23]

81.6

46,585.57

38,020.01

Canal City Hakata･B

1 [40]

94.8

31,141.44

Park Place Oita

1 [101]

99.8

121,183.73

1

100.0

61,450.22

Real estate property name
Canal City Hakata

SunLive City Kokura
Konoha Mall Hashimoto

1 [124]100.0

22,191.52

22,191.52

844

9.5

Square Mall Kagoshima Usuki

13

100.0

14,602.88

14,602.88

258

2.9

Kumamoto Intercommunity SC

2

100.0

6,968.66

6,968.66

90

1.0

Hanahata SC
Kurume Higashi Kushiwara SC(Note 6)
K’s Denki Kagoshima
Marinoa City Fukuoka (Marina
Side Building)

2

100.0

2,801.15

2,801.15

40

0.5

1

100.0

5,497.63

5,497.63

87

1.0

1

100.0

7,296.17

7,296.17

109

1.2

1

100.0

33,069.82

33,069.82

178

2.0

25 [309](Note 2)97.0

352,788.79

342,327.84

5,089

57.0

1 [64]

100.0

23,031.14

23,031.14

657

7.4

35

98.6

19,905.34

19,623.35

597

6.7

16

100.0

6,293.75

6,293.75

211

2.4

Retail subtotal:
Canal City Business Center
Building
Gofukumachi Business Center
Sanix Hakata Building
Taihaku Street Business Center1 [70]

99.1

14,677.35

14,546.48

330

3.7

Higashi Hie Business Center1 [25]

100.0

13,482.02

13,482.02

313

3.5

Tenjin Nishi-Dori Center Building

1

100.0

3,339.32

3,339.32

86

1.0

Tenjin North Front Building

12

100.0

5,261.64

5,261.64

146

1.6

Higashi Hie Business Center II

2

100.0

6,214.77

6,214.77

165

1.9

Higashi Hie Business Center III
Tenjin Nishi-Dori Business Center(Land with leasehold interest)(Note 7)
Hakata Chikushi-Dori Center
Building

6100.0

2,981.14

2,981.14

98

1.1

1

100.0

1,343.51

1,343.51

159

1.8

1 [13]

86.7

5,994.41

5,194.67

127

1.4

98.8

102,524.39

101,311.79

2,894

32.4

98.3

4,821.25

4,739.04

66

0.7

Office buildings subtotal:
Amex Akasakamon Tower

77 [245](Note 2)
1 [66]

City House Keyaki Dori1 [42]

100.0

2,710.86

2,710.86

39

0.4

Aqualia Chihaya

1 [104]98.9

5,619.69

5,559.96

60

0.7

D-Wing Tower

1 [136]

99.5

7,187.59

7,149.59

115

1.3

Granfore Yakuin Minami

1 [98]

99.0

2,496.06

2,471.10

39

0.4

Hotel FORZA Oita

1

100.0

5,785.44

5,785.44

63

0.7

Tissage Hotel Naha

1

100.0

3,758.76

3,758.76

Tosu Logistics Center

1

100.0

4,173.29

4,173.29

LOGICITY Minato Kashii

2

100.0

43,233.72

43,233.72

LOGICITY Hisayama

1

100.0

24,505.65

24,505.65

LOGICITY Wakamiya

1

100.0

17,556.32

17,556.32

40
Undisclosed(Note 8)
Undisclosed(Note 8)
Undisclosed(Note 8)
Undisclosed(Note 8)0.5
Undisclosed(Note 8)
Undisclosed(Note 8)
Undisclosed(Note 8)
Undisclosed(Note 8)99.8

121,848.63

121,643.73

938

10.5

97.9

577,161.81

565,283.36

8,921

100.0

Others subtotal:
Total
Note 1:

12 [453](Note 2)114 [1,007](Note 2)

“Number of tenants” is based on the total number of sections stipulated in the tenancy agreements for retail and officebuildings among relevant properties. For the number of tenants in pass-through master leasing properties, the number ofsections stipulated in the tenancy agreements with end tenants is shown in parentheses. The Taihaku Street BusinessCenter is an office building with a residential tower. Its number of end tenants comprises 13 offices and 57 residences.

16

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023
Note 2:
Note 3:Note 4:Note 5:Note 6:Note 7:Note 8:The subtotal and total of all the tenants in other than pass-through master leasing properties and the number of sections
stipulated in the tenancy agreements with end tenants for pass-through master leasing properties is shown in parentheses
in the total column for “Number of tenants.”“Occupancy rate” refers to the percentage of total leased floor space to total leasable floor space and the figures are rounded
off to one decimal place.
“Total leasing revenues” is the total of real estate leasing revenues and other revenues from real estate rent in the current
fiscal period.
“Percentage of total leasing revenues” is obtained by dividing each property’s total leasing revenues by the total amount of
total leasing revenues. The total of individual percentages in the above table may not equal 100%, since the figures arerounded off to one decimal place.
FRC disposed Kurume Higashi Kushiwara SC (15% co-ownership interest) on February 28, 2023.
The number of tenants indicates the number of the lessee of the land with leasehold interest. The total leasable floor spaceindicates the land area recorded in the real estate registry.
The figures are not disclosed as no consent to disclosure has been obtained from the tenants.

(2) Status of capital expenditures
1) Capital expenditures after the end of the 37th fiscal period and planned capital expenditures
The following table provides amounts of major items of capital expenditures associated with renovations, etc.
conducted after the end of the 37th fiscal period and of capital expenditures associated with renovations, etc.
planned as of April 14, 2023 for real estate properties owned by FRC. The planned construction costs indicatedbelow may be partly classified as expenses for accounting purposes. In addition, FRC will implement renewal
construction work in order to maintain and improve the competitiveness of properties in the market as well as tenantsatisfaction, on top of the construction, facilities and replacement work for which expenditures will be made regularly.

Real estate
property nameLocation

Canal City
HakataHakata Ward,
Fukuoka City

Canal City
Hakata·B

Hakata Ward,
Fukuoka City

Canal City
Hakata·B

Hakata Ward,
Fukuoka City

Park Place Oita

Oita City, Oita

Park Place Oita

Oita City, Oita

SunLive City
KokuraKokura Minami
Ward, Kitakyushu
City

Taihaku Street
Business Center

Hakata Ward,
Fukuoka City

Taihaku Street
Business Center

Hakata Ward,
Fukuoka City

Taihaku Street
Business Center

Hakata Ward,
Fukuoka CityD-Wing Tower

Chuo Ward,
Fukuoka City

Granfore Yakuin
Minami

Chuo Ward,
Fukuoka City

PurposeSchedule

Replacement offacilities andformation of floor
sections
Replacement oflighting equipment atparking lots
Replacement ofemergency power
generators

Planned construction cost
(mm of yen)Amountpaid in the Total amountTotal
37th fiscal already paid
periodFrom January 2023 to
May 2023

406

—

—

From May 2023 toJuly 2023

51

—

—

From July 2022 toApril 2023

50

—

—

Replacement of airconditioning units

From March 2023 to
May 2023

147

—

—

Replacement ofwater receiving tanks

From September
2023 to November
2023

99

—

—

From May 2023 toAugust 2023

85

—

—

From May 2023 toAugust 2023

113

—

—

From October 2023 to
February 2024

87

—

—

From June 2023 toJanuary 2024

78

—

—

Renovation of
external walls

From September
2023 to February
2024

114

—

2

Renovation of
external walls

From January 2023 to
May 2023

80—

1

Renovation of
parking lot on the 3rd
floor
Renovation of
external walls of theoffice building
Renovation of
external walls of theresidential tower
Replacement ofcentral monitoring
devices andequipment

17

Fukuoka REIT Corporation (8968); Earnings Briefing for the Period ended February 2023

2) Capital expenditures during the 37th fiscal period
Capital expenditures for the real estate properties owned by FRC totaled 385 mm yen in the 37th fiscal period.
Furthermore, FRC incurred construction costs of 662 mm yen in total in the period, including 266 mm yen in repair
and maintenance expenses classified as expenses on the statement of income and 10 mm yen in expenses forrestoration to former state. The following table provides the overview of major construction work that was completed
in the 37th fiscal period.
Real estate
property nameLocation

PurposeCanal City Hakata

Hakata Ward,
Fukuoka City

Replacement of airconditioning units

From March 2022 toFebruary 2023

78

Park Place Oita

Oita City, Oita

Environmental presentation
with illumination for winterFrom October 2022 to
December 2022

14

Park Place Oita

Oita City, Oita

Renovation of restrooms for
employees

December 2022

13

Sanix Hakata
Building

Hakata Ward,
Fukuoka City

Replacement of total heatexchangers

From January 2023 to
February 2023

12

Higashi Hie BusinessCenterHakata Ward,
Fukuoka City

From September 2022 to
December 2022

57

Aqualia Chihaya

Higashi Ward,
Fukuoka City

Switching to LED lighting in
exclusive areas
Replacement of disasterprevention facilities andequipment

February 2023

21

18

PeriodConstruction cost
(mm of yen)