This English translation is provided for information purposes only. If any discrepancy is identified between thistranslation and the Japanese original, the Japanese original shall prevail.
January 23, 2024
REIT Issuer:
Japan Hotel REIT Investment Corporation (TSE code: 8985)
Kaname Masuda, Executive Director
Asset Management Company:
Japan Hotel REIT Advisors Co., Ltd.
Hisashi Furukawa, President & CEO
Contact:
Makoto Hanamura
Director of the Board, Managing Director
Head of Finance and Planning Division
TEL: +81-3-6422-0530
Notice Concerning Revision of Operating and Dividend Forecasts for Fiscal Year Ended December 2023 (24th Period)
and Operating and Dividend Forecasts for Fiscal Year Ending December 2024 (25th Period)
Japan Hotel REIT Investment Corporation (hereinafter called “JHR”) announces revisions to its operating and dividend
forecasts for the fiscal year ended December 2023 (24th Period), released on September 11, 2023, as detailed in the“Notice Concerning Revision of Operating Forecast for the Fiscal Year Ending December 2023 (January 1, 2023 to
December 31, 2023).” JHR also announces its operating and dividend forecasts for the fiscal year ending December 2024
(January 1, 2024 to December 31, 2024) as follows:
1.

Revision of Operating and Dividend Forecasts for Fiscal Year Ended December 2023
(January 1, 2023 through December 31, 2023)
Operatingrevenue
Previous forecast(A)
Forecast this time
(B)
Variance(C) = (B) - (A)Variance ratio(D) = (C) / (A)JPY1M

OperatingincomeJPY1M

Ordinary
incomeJPY1M

Net income
JPY1M

Dividend per unit
(excluding excessof earnings)
JPY

Dividend perunit resulting
from excessof earnings
JPY

25,13813,437

11,493

11,491

2,652

JPY1M

JPY1M

JPY1M

JPY1M

JPY

JPY
JPY

26,57415,014

13,135

13,133

3,014

JPY1M

JPY1M

JPY1M

JPY1M

1,641

JPY

362

%

%

%

%

%

1,435
5.7

1,577

1,641

11.7

14.3

14.3

13.7

－
－
－
%

－

(Reference) Forecast of net income per unit for the full fiscal year: JPY2,909(Calculated based on the average number of investment units during the period (4,514,513 units))(*1) Dividend per unit is calculated based on the number of investment units issued as of today: 4,637,006 units.
(*2) The total dividend is planned to include the reversed amount of reserve for temporary difference adjustment due tonegative goodwill (JPY845 million).
(*3) For the details of the operating forecast and forecast of dividend above, please refer to <Reference Information 1>“Assumptions for revision of the operating forecast for the full fiscal year ended December 2023 (24th period).”(*4) Amounts are rounded down to the nearest millions of yen, and percentages are rounded off to the nearest first decimal
place. The same shall apply hereinafter.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

1

2.

Operating and Dividend Forecasts for Fiscal Year Ending December 2024
(January 1, 2024 through December 31, 2024)

FY12/2024
Midterm
FY12/2024
Full year(Reference)
(*1)
(*2)
(*3)
(*4)

3.

Dividend per unit

Operatingrevenue

OperatingincomeOrdinary
incomeNet income(Excess of earnings
exclusive)

JPY1M

JPY1M

JPY1M

JPY1M

JPY

13,936
JPY1M

31,288

7,974

JPY1M

18,815

6,880

JPY1M

16,713

6,880

JPY1M

16,712

Dividend perunit resulting
from excessof earnings
JPY

－

－

JPY

JPY

3,722

－

Forecast of net income per unit for the full fiscal year: JPY3,604(Calculated based on the average number of investment units during the period (4,637,006 units))
Dividend per unit is calculated based on the number of investment units issued as of today: 4,637,006 units.
The total dividend is planned to include the reversed amount of reserve for temporary difference adjustment due
to negative goodwill (JPY549 million).
For the details of the assumptions of operating forecasts above, please refer to “<Reference Information 2>
Assumptions for the operating forecast for the midterm for the fiscal year ending December 2024 (25th period)and for the full fiscal year ending December 2024 (25th period).”
Amounts are rounded down to the nearest millions of yen, and percentages are rounded off to the nearest firstdecimal place. The same shall apply hereinafter.

Rationale for Revisions of Operating and Dividend Forecasts for Fiscal Year Ended December 2023
(January 1, 2023 through December 31, 2023)
Since the operating results of each hotel through December 2023 have almost become clear, JHR revised the operating
and dividend forecasts for the fiscal year ended December 2023.
The fiscal year ended December 2023 saw a marked recovery. In the second half of the year, the domestic demandremained strong, the inbound demand recovered significantly, and the number of inbound visitors to Japan reached
the same level as 2019. With these increased domestic and international demands, hotel business performancecontinues to recover.
In the forecast for the full fiscal year ended December 2023, real estate operating revenue is expected to increase by
JPY1,435 million from the previous forecast, mainly due to an increase in variable rent resulting from a recovery inhotel business performance. In addition, due to a review of various expenses related to the property and operating
expenses, etc., operating expenses are expected to decrease by JPY141 million, and non-operating expenses are
expected to decrease by JPY63 million due to a decrease in financing costs, etc. As a result, net income is expected
to increase by JPY1,641 million from the previous forecast.
For details of the comparison with the previous forecast, please refer to “4. Highlights of Operating and Dividend
Forecasts” below.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

2

4.

Highlights of Operating and Dividend Forecasts(1) Operating and dividend forecasts for the fiscal year ended December 2023 (24th period) (current forecast) vs.
Previous forecasts and factors causing variance(Unit: millions of yen)

Properties

FY12/2023
FY12/2023(24th Period) (24th Period)

Profit and Loss

Current
Forecast(A)(B)(B)-(A)

46

47

1

－

Acquisition Price

392,918

396,918

4,000

1.0%

Operating Revenue

25,13826,574

1,435

5.7%

Real Estate
Operating Revenue

25,13826,574

1,435

5.7%

55.2%

17

0.1%

58.2%

14,658Composition

Other Income

1,272

1,070

(201)

(15.8%)

Composition

5.1%

4.0%

Variable Rent

9,225

10,844

1,619

Composition

36.7%

40.8%

17.6% Three HMJ Hotels acquired in 2023 (*2): ＋JPY58MMThe Accor Group Hotels (*3): +JPY88MMThe Ishin Group Hotels (*4): +JPY67MM
Other hotels and tenants: JPY+552MM

NOI (*5)

20,684

22,344

1,660

8.0%

15,533

17,108

1,575

10.1%

13,43715,014

1,577

11.7%

Net Income

11,491

13,133

1,641

14.3%

Amount of Reversal from
Reserve for Temporary
Difference Adjustments(Negative Goodwill)806

Total Dividends

12,297

13,975

1,678

No. of Unit Issued(Unit)

4,637,006

4,637,006

－

2,652

3,014

362

NOI Yield (*5)

NOI after Depreciation (*5)
NOI Yield after Depreciation (*5)

Operating Income
Ordinary Income

Dividend per Unit (JPY)

14,641

Factors Causing Variance% ofincrease/decrease

No. of Properties

Fixed Rent

Dividend

Previous
Forecast

Difference

5.3%
4.0%

11,493

5.6%
4.3%

13,135

845

0.4pt
0.4pt

1,641

39

Revenue from unilities (*1): -JPY193MM
The 16 HMJ Hotels (*2): +JPY853MM

14.3%

Amount of reversal from reserve for temporary difference adjustments
4.9% Previous forecast:

50-year amortization amount on negative goodwill: JPY262MM
Loss on retirement of noncurrent assets: JPY112MM
Amortization of trademark rights: JPY56MM
13.7% Dilution: JPY375MM
Forecast this time:－ 50-year amortization amount on negative goodwill: JPY262MM
Loss on retirement of noncurrent assets: JPY151MM
Amortization of trademark rights: JPY56MM
13.7% Dilution: JPY375MM(*1) Utility expenses arise from both revenue from utilities and utility expenses. Compared to the previous forecast, utility expenses decreased by JPY231
million, resulting in a positive impact of JPY38 million on the net income.
(*2) The “Five HMJ Hotels” refer to the following five hotels that JHR leases to Hotel Management Japan Co., Ltd. (hereinafter called “HMJ”). The same shallapply hereinafter.
Kobe Meriken Park Oriental Hotel
Oriental Hotel Tokyo Bay
Namba Oriental Hotel
Hotel Nikko Alivila
Oriental Hotel Hiroshima
The “16 HMJ Hotels” refer to the Five HMJ Hotels plus the following hotels, which JHR leases to subsidiaries of HMJ. The same shall apply hereinafter.
Oriental Hotel Universal City
Oriental Hotel Okinawa Resort & Spa
Sheraton Grand Hiroshima Hotel (main facility of ACTIVE-INTER CITY HIROSHIMA)
Oriental Hotel Fukuoka Hakata Station
Holiday Inn Osaka Namba
Hotel Oriental Express Fukuoka Tenjin
Hilton Tokyo Narita Airport
International Garden Hotel Narita
Hotel Nikko Nara
Hotel Oriental Express Osaka Shinsaibashi
Hilton Tokyo Odaiba<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

3

The “Three HMJ Hotels acquired in 2023” refer to the following three hotels acquired in 2023, which JHR leases to subsidiaries of HMJ. The same shallapply hereinafter.
Oriental Hotel Kyoto Rokujo
Hotel Oriental Express Fukuoka Nakasukawabata
Hotel JAL City Kannai Yokohama
The “HMJ 19 Hotels” refer to 19 hotels, consisting of the 16 HMJ Hotels plus the Three HMJ Hotels acquired in 2023. The same shall apply hereinafter.
(*3) The “Accor Group Hotels” refer to the following five hotels: ibis Styles Kyoto Station, ibis Styles Sapporo, Mercure Sapporo, Mercure Okinawa Naha, andMercure Yokosuka. The same shall apply hereinafter.
(*4) The “Ishin Group Hotels” refer to the following four hotels: the b suidobashi, the b ikebukuro, the b hachioji, and the b hakata. The same shall apply
hereinafter.
(*5) Each is calculated using the following formula. The same shall apply hereinafter. The same shall apply hereinafter.
NOI (Net Operating Income) = Real estate operating revenue – Real estate operating costs + Depreciation + Loss on retirement of noncurrent assets +Asset retirement obligations expenses
NOI yield = NOI ÷ acquisition price
NOI after depreciation = Real estate operating revenue – Real estate operating costs
NOI yield after depreciation = NOI after depreciation ÷ Acquisition price.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

4

(2)

Operating and dividend forecasts for the fiscal year ending December 2024 (25th period) vs. forecasts for theprevious period and factors causing variance(Unit: millions of yen)

Profit and Loss

Properties

FY12/2023
FY12/2024(24th Period) (25th Period)
Forecast(A)(B)(B)-(A)% of
increase/decrease

Properties
Existing
acquired
Properties
in 2023(*2)(*1)

Factors Causing Variance

No. of Properties

47

47

－

－

－

－

Acquisition Price

396,918

396,918

－

－

－

－

Operating Revenue

26,57431,288

4,714

17.7%

－

－

Real Estate
Operating Revenue

26,57431,288

4,714

17.7%

－

－

Fixed Rent

14,65815,132

473

3.2%

474

(1) Properties acquired in 2023:

Composition

55.2%

48.4%

Other Income

1,070

1,034

(36)

(3.4%)

11(47)

Composition

4.0%

3.3%
Properties acquired in 2023:
Three HMJ Hotels acquired in 2023: +JPY279MM
La’gent Stay Sapporo Odori: +JPY424MM
3,468
Sotetsu Fresa Inn Shimbashi-Karasumoriguchi: +JPY104MM

10,844

15,121

Composition

40.8%

48.3%

NOI

22,344

26,825

4,481

20.1%

1,207

3,273

17,10821,248

4,140

24.2%

1,072

3,067

15,014

18,815

3,800

25.3%

13,133

16,712

3,578

27.2%

(35.0%)NOI after Depreciation
NOI Yield after Depreciation

Operating Income
Ordinary Income
Net Income
Amount of Reversal from
Reserve for Temporary
Difference Adjustments(Negative Goodwill)

5.6%
4.3%

13,1356.8%
5.4%

16,713

4,277

Three HMJ Hotels acquired in 2023: +JPY386MM
Sotetsu Fresa Inn Shimbashi-Karasumoriguchi: +JPY68MM

Variable Rent

NOI Yield

Dividend

Current
Forecast

Difference

1.1pt
1.0pt

3,578

845

549

(295)

Total Dividends

13,975

17,2583,283

No. of Unit Issued(Unit)

4,637,006

4,637,006

－

3,014

3,722

708

Dividend per Unit (JPY)

808

39.4%

Existing Properties:
The 16 HMJ Hotels: +JPY2,793MM
The Accor Group Hotels: +JPY522MM
The Ishin Group Hotels: +JPY101MM

27.2%

Amount of reversal from reserve for temporary difference adjustments
FY2023:50-year amortization amount on negative goodwill: JPY262MM
Loss on retirement of noncurrent assets: JPY151MM
Amortization of trademark rights: JPY56MM
23.5% Dilution: JPY375MM－ FY2024:
50-year amortization amount on negative goodwill: JPY262MM
Loss on retirement of noncurrent assets: JPY231MM
23.5%
Amortization of trademark rights: JPY56MM(*1) The “Properties acquired in 2023” refer to the following six hotels acquired in 2023. The same shall apply hereinafter.
UAN kanazawa
Sotetsu Fresa Inn Shimbashi-Karasumoriguchi
La’gent Stay Sapporo Odori
Oriental Hotel Kyoto Rokujo
Hotel Oriental Express Fukuoka Nakasukawabata
Hotel JAL City Kannai Yokohama(*2) The “Existing Properties” refer to the 41 hotels, excluding the Properties acquired in 2023, from all 47 hotels held by JHR as of today. The same shall apply
hereinafter.

(Note)
The above forecasts are based on the status of operation as of today, and the actual dividend per unit may fluctuate.
The forecasts do not guarantee the dividends shown above.
* Website of Japan Hotel REIT Investment Corporation: https://www.jhrth.co.jp/en/<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

5

<Reference Information 1>
Assumptions for Operating Forecasts for Full Fiscal Year Ended December 2023 (24th Period)
Item
Calculation
PeriodAssets underManagement

Assumptions
・Full fiscal year ended December 2023 (24th Period): January 1, 2023 through December 31, 2023 (365 days)
・The 47 properties owned by JHR as of the end of December 2023 are assumed.
・Operating revenue is calculated based on the lease conditions and other effective contracts, considering thecompetitiveness of hotels, market environment, and other factors. If there are lease contracts with facilities otherthan hotels, such as commercial facilities and offices, operating revenue calculated based on the said lease contracts
is included.
・Rents, etc., of the main hotels are calculated based on the following assumptions.
(1) The 19 HMJ Hotels
The rents for the HMJ 19 hotels consist of fixed and variable rents. The variable rents are calculated based on thefollowing formula:
Variable rent = [Hotel AGOP (*1) - Base amount] × Variable rent ratio (%)
However, if the AGOP is less than the base amount, the variable rent will be 0 yen.
(Unit: millions of yen)Fixed rent
The Five HMJ Hotels

Operating
Revenue

Variable rent

Total rent

3,221

2,341

5,562

Oriental Hotel Universal City

316

1,272

1,589

Oriental Hotel Okinawa Resort & Spa

550

91

641

Sheraton Grand Hiroshima Hotel (*2)

348

369

717

Oriental Hotel Fukuoka Hakata Station

425

1,090

1,515

Holiday Inn Osaka Namba

576

319

895

Hotel Oriental Express Fukuoka Tenjin

135

336

471

The Hilton Tokyo Narita Airport

444

88

532

International Garden Hotel Narita

336

141

477

Hotel Nikko Nara

420

24

444

Hotel Oriental Express Osaka Shinsaibashi

110

69

179

1,600

749

2,349

Oriental Hotel Kyoto Rokujo

44

49

94

Hotel Oriental Express Fukuoka Nakasukawabata

45

29

75

Hotel JAL City Kannai Yokohama

3

6

10

8,576

6,980

15,556

Hilton Tokyo Odaiba

Total(*1) AGOP (adjusted GOP) is calculated by subtracting certain fees and other items from GOP. GOP (grossoperating profit) is the remainder after expenses incurred in hotel operation, such as personnel costs andgeneral and administrative expenses, etc., are deducted from total sales. The same shall apply hereinafter.
(*2) The rent for Sheraton Grand Hiroshima Hotel, the major facility of ACTIVE-INTER CITY HIROSHIMA.
Fixed rent and variable rent from tenants of office and commercial facilities in ACTIVE-INTER CITYHIROSHIMA are as follows.
(Unit: millions of yen)Fixed rent
ACTIVE-INTER CITY HIROSHIMA(tenants of office and commercial facility)

486

Variable rent
12

Total rent
499

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

6

Item

Assumptions(2) Income from management contracts (*3) and variable rent from other hotels with variable rent, etc.
(Unit: millions of yen)
Full year

Operating
Revenue

ibis Styles Kyoto Station (*3)

272

ibis Styles Sapporo (*3)

413

Mercure Sapporo (*3)

470

Mercure Okinawa Naha (*3)

172

Mercure Yokosuka

270

the b suidobashi

67

the b ikebukuro

181

the b hachioji

106

the b hakata

152

dormy inn Kumamoto

53

Comfort Hotel Tokyo Higashi Nihombashi

181

Smile Hotel Nihombashi Mitsukoshimae

4

Chisun Hotel Kamata

118

Chisun Inn Kamata

66

Hilton Tokyo Bay

Undisclosed (*4)

Hilton Nagoya

Undisclosed (*4)

UAN kanazawa

19

Sotetsu Fresa Inn Shimbashi-Karasumoriguchi

0La’gent Stay Sapporo Odori

127

Total
3,851
(*3) Management contract system is adopted. Management contract system refers to the operation of the hotel
property owned by JHR by entrusting the operation of the hotel to the trustee and incorporating the results of
the operation into JHR as income from real estate management. Each hotel’s GOP amount is recognized inoperating revenues as income from management contracts.
(*4) Undisclosed since tenants that concluded lease contracts did not agree to disclose rent revenue, etc.
・The following is the breakdown of variable rent and income from management contracts.
(Unit: millions of yen)
Full year
The 19 HMJ Hotels

6,980

Other hotels with variable rent, etc.

3,851

Tenants of office and commercial facility (*5)

12

Total
10,844(*5) Variable rent from tenants of office and commercial facilities in ACTIVE-INTER CITY HIROSHIMA.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

7

Item

Assumptions

OperatingExpenses

・With respect to real estate leasing expenses, which constitute a major part of the operating expenses, expenses otherthan depreciation are calculated based on historical data, and variable factors are reflected in the calculation.
・It is assumed that JPY1,976 million will be recognized as expenses for fixed asset taxes, city planning taxes, etc. In
general, property taxes and city planning taxes for the year of acquisition on acquired assets are settled with theprevious owner on a pro-rata basis over a period of time, and the amount equivalent to such settlement is included in
the acquisition cost. Therefore, property taxes and city planning taxes on the six properties (UAN kanazawa, Sotetsu
Fresa Inn Shimbashi-Karasumoriguchi, La’gent Stay Sapporo Odori, Oriental Hotel Kyoto Rokujo, Hotel Oriental
Express Fukuoka Nakasukawabata and Hotel JAL City Kannai Yokohama) acquired by the fiscal year ended
December 2023 will not be included in expenses for the relevant calculation period.
・Capital expenditure is assumed to be JPY4,769 million (JPY2,738 million for Capital Expenditure I, JPY736 million
for Capital Expenditure II, and JPY1,295 million for Capital Expenditure III) for the fiscal year ended December
2023.
(*) JHR classifies capital expenditures into the following three categories. (I) Capital investment related to therenewal of equipment and facilities of buildings, which is required to maintain proper values of properties; (II)capital investment for fixtures, furniture, and equipment that are not directly related to building structure or
facilities but necessary for operating hotels, and (III) strategic capital investment such as renovating guest rooms,
etc. for improving the competitiveness of the hotels.
・Depreciation is calculated using the straight-line method including the planned capital expenditures above, and isassumed to be JPY5,083 million.
・Repair expenses for buildings are recognized as expenses in the assumed amount necessary for each operating period.
Please note that the repair expenses of each operating period may differ materially from the forecast amount forvarious reasons, such as (1) Emergency repair expenses may be necessary due to damage to buildings from
unexpected causes; (2) The amount of repair expenses generally tends to increase in difference over time; and (3)Repair expenses are not required on a regular basis.

Non-operating
Expenses

・JPY1,886 million is expected for borrowing-related costs, including interest expense, amortization for financing fees,arrangement fees, and other non-operating expenses.

Interestbearing Debt

・The balance of total interest-bearing debt (total of loans and investment corporation bonds) as of the end of December
2023 is assumed to be JPY175,231 million.
・Dividend per unit for the fiscal year ended December 2023 (24th period) is calculated based on the following
assumptions.
(Unit: millions of yen)
Unappropriated retained earnings

13,133

Reversal of reserve for temporary difference adjustment (negative goodwill)

Dividend per
Unit

50-year amortization amount of negative goodwill (*1)

262

Loss on retirement of noncurrent assets (*2)

151

Amortization of trademark rights (*3)

56

Dilution (*4)

375

Distributable amount

13,979Total number of investment units issued

4,637,006 units

Dividend per unit

JPY3,014(*1) JPY262 million (hereinafter called “50-year amortization amount of negative goodwill”) is scheduled to be
paid out as dividends, with the remaining balance of the reserve for temporary difference adjustment set as the
maximum amount for every fiscal year.
(*2) The amount recognized as a loss on retirement of noncurrent assets will be appropriated by the reserve fortemporary difference adjustment (negative goodwill) and is expected to have no impact on dividend per unit.
(*3) The trademark rights are amortized over ten years using the straight-line method. Amortization is expected tobe recognized during the current fiscal year, will be appropriated by the reserve for temporary difference
adjustment (negative goodwill), and is expected to have no impact on dividend per unit.
(*4) To deal with dilution of investment units due to the issuance of new investment units in the fiscal year ended
December 2023, JHR plans to appropriate the reserve for temporary difference adjustment (negative goodwill)
for the dividend per unit in the fiscal year ended December 2023.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

8

Item

Assumptions

Dividend per
Unit

・Dividend per unit may fluctuate due to various causes, such as fluctuation of rent revenue resulting from the changeof assets under management, hotel tenants, the hotel business environment surrounding hotel tenants, etc., unexpected
repairs, and an actual number of new investment units issued.
・The remaining balance of the reserve for temporary difference adjustment (negative goodwill) after the appropriationof the reserve for temporary difference adjustment (negative goodwill) for dividends for the fiscal year ended
December 2023 (24th period) is expected to be JPY8,754 million.

Dividend per
Unit
Resultingfrom Excessof Earnings

・It is assumed that the excess of earnings (dividend per unit resulting from excess of earnings) will not be distributed.

Others・It is assumed that revisions in law and tax system, accounting standards, regulations of the listing, and regulations of
the Investment Trusts Association, Japan, which may impact the forecast above, will not be made.
・It is assumed that unexpected major incidents will not occur in the general economy, real estate market, hotel businessenvironment, etc.
・The numerical values are rounded down to the nearest millions of yen in the assumptions above.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

9<Reference Information 2>
Assumptions for Operating Forecast for Midterm and Full Year for Fiscal Year Ending December 2024 (25th Period)
Item

Assumptions

Calculation
Period・Midterm for the year ending December 2024 (25th Period): January 1, 2024 through June 30, 2024 (182 days)
・Full fiscal year ending December 2024 (25th Period): January 1, 2024 through December 31, 2024 (366 days)

Assets underManagement

・The 47 properties owned by JHR as of end of December 2023 are assumed.
・It is assumed that there will be no change in assets under management (acquisition of new properties, sale ofproperties, etc.) by the end of the fiscal year ending December 2024 (25th period). The actual assets undermanagement may change.
・Operating revenue is calculated based on the lease conditions and other effective contracts, considering thecompetitiveness of hotels, market environment, and other factors. If there are lease contracts with facilities otherthan hotels, such as commercial facilities and offices, operating revenue calculated based on the said lease contracts
is included.
・Rents, etc., of the main hotels are calculated based on the following assumptions.
(1) The 19 HMJ Hotels
The rents for the 19 HMJ Hotels consist of fixed and variable rents. The variable rents are calculated based on thefollowing formula:
Variable rent = [Hotel AGOP - Base amount] × Variable rent ratio (%)
However, if the AGOP is less than the base amount, the variable rent will be 0 yen.
(Unit: millions of yen)Fixed rent
Variable rent
Total rent
Midterm
Full year
Midterm
Full year
Midterm
Full year
The Five HMJ Hotel

Operating
Revenue

1,610

3,221

1,180

3,316

2,790

6,537

Oriental Hotel Universal City

158

316

578

1,454

736

1,771

Oriental Hotel Okinawa Resort
& Spa

274

550

－

562

274

1,112

Sheraton Grand Hiroshima
Hotel (*1)

174

348

122

323

296

671

Oriental Hotel Fukuoka
Hakata Station

212

425

582

1,224

794

1,649

Holiday Inn Osaka Namba

288

576

307

693

595

1,269

Hotel Oriental Express
Fukuoka Tenjin

67

135

183

394

251

529

The Hilton Tokyo Narita
Airport

222

444

60

201

282

645

International Garden Hotel
Narita

168

336

110

235

278

571

Hotel Nikko Nara

210

420

15

117

225

537

Hotel Oriental Express Osaka
Shinsaibashi

55

110

41

87

96

197

Hilton Tokyo Odaiba

799

1,600

348

1,075

1,147

2,675

Oriental Hotel Kyoto Rokujo

85

171

48

133

134

304

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

10

Item

Assumptions

Fixed rent
Midterm
Full year

Operating
Revenue

Variable rent
Midterm
Full year

Total rent
Midterm
Full year

Hotel Oriental Express
Fukuoka Nakasukawabata

87

174

68

148

155

322

Hotel JAL City Kannai
Yokohama

67

135

30

83

98

218

4,480

8,962

3,678

10,053

8,159

19,015

Total(*1) The rent for Sheraton Grand Hiroshima Hotel, the major facility of ACTIVE-INTER CITY HIROSHIMA.
Fixed rent and variable rent from office and commercial facility tenants in ACTIVE-INTER CITYHIROSHIMA are as follows.
(Unit: millions of yen)Fixed rent
Variable rent
Total rent
Midterm
Full year
Midterm
Full year
Midterm
Full year
ACTIVE-INTER CITYHIROSHIMA (tenants of
244
487
6
12
250
499
office and commercial facility)<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

11

Item

Assumptions(2) Income from management contracts (*2) and variable rent from other hotels with variable rent, etc.
(Unit: millions of yen)ibis Styles Kyoto Station (*2)

Operating
Revenue

Midterm

Full year

149

315

ibis Styles Sapporo (*2)

238

583

Mercure Sapporo (*2)

284

652

Mercure Okinawa Naha (*2)

111

251

Mercure Yokosuka

152

317

the b suidobashi

3783

the b ikebukuro

116

240

the b hachioji

61

123

the b hakata

77

162

dormy inn Kumamoto

3

58

Comfort Hotel Tokyo Higashi Nihombashi

37

37

Smile Hotel Nihombashi Mitsukoshimae

25

25

Chisun Hotel Kamata

64

129

Chisun Inn Kamata

37

74

Hilton Tokyo Bay

Undisclosed (*3)

Undisclosed (*3)

Hilton Nagoya

Undisclosed (*3)

Undisclosed (*3)

UAN kanazawa

5

19

Sotetsu Fresa Inn Shimbashi-Karasumoriguchi

104

104

La’gent Stay Sapporo Odori

232

552

Total
2,213
5,056
(*2) Management contract system is adopted. Management contract system refers to the operation of the hotel
property owned by JHR by entrusting the operation of the hotel to the trustee and incorporating the results of
the operation into JHR as income from real estate management. Each hotel’s GOP amount is recognized inoperating revenues as income from management contracts.
(*3) Undisclosed since tenants that concluded lease contracts did not agree to disclose rent revenue, etc.
・The following is the breakdown of variable rent and income from management contracts.
(Unit: millions of yen)
Midterm
Full year
The 19 HMJ Hotels

3,678

10,053

Other hotels with variable rent, etc.

2,213

5,056

6

12

Tenants of office and commercial facility (*4)

Total
5,897
15,121(*4) Variable rent from office and commercial facility tenants in ACTIVE-INTER CITY HIROSHIMA is shown.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

12

Item

Assumptions

OperatingExpenses

・With respect to real estate leasing expenses, which constitute a major part of the operating expenses, expenses otherthan depreciation are calculated based on historical data, and variable factors are reflected in the calculation.
・It is assumed that JPY2,126 million will be recognized as expenses for fixed asset taxes, city planning taxes, etc. In
general, property taxes and city planning taxes for the year of acquisition on acquired assets are settled with theprevious owner on a pro-rata basis over a period of time, and the amount equivalent to such settlement is included in
the acquisition cost.
・Capital expenditure is assumed to be JPY6,988 million (JPY3,506 million for Capital Expenditure I, JPY317 million
for Capital Expenditure II, and JPY3,165 million for Capital Expenditure III).
(*) JHR classifies capital expenditures into the following three categories. (I) Capital investment related to renewalof equipment and facilities of buildings, which is required to maintain proper values of properties; (II) capital
investment for fixtures, furniture, and equipment that are not directly related to building structure or facilities
but necessary for operating hotels, and (III) strategic capital investment such as renovating guest rooms, etc. for
improving the competitiveness of the hotels.
・Depreciation is calculated using the straight-line method, including the planned capital expenditures above, and isassumed to be JPY5,345 million.
・Repair expenses for buildings are recognized as expenses in the assumed amount necessary for each operating period.
Please note that the repair expenses of each operating period may differ materially from the forecast amount forvarious reasons, such as (1) Emergency repair expenses may be necessary due to damage to buildings from
unexpected causes; (2) The amount of repair expenses generally tends to increase in difference over time; and (3)Repair expenses are not required on a regular basis.

Non-operating
Expenses・Borrowing-related costs including interest expense, amortization for financing fee, arrangement fee, and other nonoperating expenses are expected to be JPY2,101 million.

Interestbearing Debt

・The balance of interest-bearing debt (total of borrowings and investment corporation bonds) as of the end of
December 2023 was JPY175,231 million, and it is assumed that there will be no change in the balance of interestbearing debt through to the end of the fiscal year ending December 2024 (25th period).
・It is assumed that the loan amount of JPY37,089 million, maturing by the end of the fiscal year December 2024 (25thperiod), will be fully refinanced.
･It is assumed that JPY3,000 million of the investment corporation bonds maturing by the end of December 2024 (25thperiod) will be appropriated to issue the investment corporation bonds of the same amount.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

13

Item

Assumptions
・Dividend per unit for the fiscal year ended December 2024 (25th period) is calculated based on the following
assumptions.
(Unit: millions of yen)
Unappropriated retained earnings

16,712

Reversal of reserve for temporary difference adjustment (negative goodwill)
50-year amortization amount of negative goodwill (*1)

262

Loss on retirement of noncurrent assets (*2)

231

Amortization of trademark rights (*3)

56

Distributable amount

17,261

Total number of investment units issued
Dividend per
Unit

Dividend per
Unit
Resultingfrom Excessof Earnings

Others4,637,006 units

Dividend per unit

JPY3,722(*1) JPY262 million (hereinafter called “50-year amortization amount of negative goodwill”) is scheduled to be
paid out as dividends, with the remaining balance of the reserve for temporary difference adjustment set as the
maximum amount for every fiscal year.
(*2) The amount recognized as a loss on retirement of noncurrent assets will be appropriated by the reserve fortemporary difference adjustment (negative goodwill) and is expected to have no impact on dividend per unit.
(*3) The trademark rights are amortized over ten years using the straight-line method. Amortization, which is
expected to be recognized during the current fiscal year, will be appropriated by the reserve for temporary
difference adjustment (negative goodwill) and is expected to have no impact on dividend per unit.
・Dividend per unit may fluctuate due to various causes, such as fluctuation of rent revenue resulting from the changeof assets under management, hotel tenants, the hotel business environment surrounding hotel tenants, etc. unexpected
repairs, and an actual number of new investment units issued.
・The remaining balance of the reserve for temporary difference adjustment (negative goodwill) after the appropriationof the reserve for temporary difference adjustment (negative goodwill) for dividends for the fiscal year ending
December 2024 (25th period) is expected to be JPY8,204 million.
・It is assumed that the excess of earnings (dividend per unit resulting from excess of earnings) will not be distributed.

・It is assumed that revisions in law, tax system, accounting standard, regulations of the listing, and regulations of theInvestment Trusts Association, Japan that may impact the forecast above will not be made.
・It is assumed that unexpected major incidents will not occur in the general economy, real estate market, hotel businessenvironment, etc.
・The numerical values are rounded down to the nearest millions of yen in the assumptions above.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

14

<Reference Information 3> Hotel Operation Indexes, Sales And GOP
The numeral figures are based on figures obtained from hotel lessees, etc. Please note that these figures have not been audited orundergone other procedures. No guarantee is made as to the accuracy or completeness of the figures and information.
ADR (*1) and RevPAR (*2) are rounded off to the nearest yen. Sales and GOP are rounded off to the nearest millions of yen.
Occupancy rate and comparison with the previous period are rounded off to one decimal place.
<1> The 16 HMJ Hotels

First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year

Fiscal year ended December 2023
Comparison
Previous forecast Current forecastwith previous(first half actual) (first half actual)
forecast

Fiscal year ending December 2024
Comparison
Forecastwith previous
fiscal year

76.0%

76.0%

－

82.0%

6.0pt

82.8%

81.4%

(1.4pt)

84.6%

3.2pt

79.4%

78.7%

(0.7pt)

83.3%

4.6pt

18,75318,753－

20,495

9.3%

21,29322,215

4.3%

24,038

8.2%

20,08820,5582.3%

22,304

8.5%

14,243

14,243－

16,80418.0%

17,63518,0822.5%

20,32712.4%

15,953

16,179

1.4%

18,575

14.8%

Sales (JPY MM)

23,122

23,122－

26,603

15.1%

Rooms Dept.

13,821

13,821－

16,396

18.6%

Occupancy Rate

ADR
(JPY)

RevPAR(JPY)

F&B Dept.

First half ofthe year

7,898

7,898

－

9,118

15.4%

Others

1,403

1,403

－

1,089

(22.4%)

Sales (JPY MM)

27,74028,3802.3%

32,00712.8%

17,396

17,837

2.5%

20,051

12.4%

9,055

9,236

2.0%

10,795

16.9%

Others

1,289

1,307

1.4%

1,161

(11.2%)

Sales (JPY MM)

50,86251,503

1.3%

58,61013.8%

Rooms Dept.

31,21731,658

1.4%

36,44715.1%

16,953

17,134

1.1%

19,914

16.2%

2,692

2,711

0.7%

2,250

(17.0%)

7,166

7,166

－

8,743

22.0%

9,614

10,546

9.7%

12,061

14.4%

16,78017,712

5.6%

20,804

17.5%

Rooms Dept.
F&B Dept.

F&B Dept.

Second halfof the year

Full year

OthersGOP(JPY MM)First half ofthe year
Second halfof the year
Full year(*1) ADR refers to average daily rate, which is calculated by dividing revenue of the rooms department (including service charges) for a certain
period by the total number of rooms sold during the period. The same shall apply hereinafter.
(*2) RevPAR refers to revenue per available room, which is calculated by dividing total room revenue (including service charges) for a certain
period by the total number of rooms available for sale during the period. The same shall apply hereinafter.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

15

<2> The 19 HMJ Hotels

First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year

Fiscal year ended December 2023
Comparison
Previous forecast Current forecastwith previous(first half actual) (first half actual)
forecast

Fiscal year ending December 2024
Comparison
Forecastwith previous
fiscal year

－

75.8%

－

82.3%

6.5pt

－

81.3%

－

84.8%

3.5pt

－

78.6%

－

83.5%

5.0pt

－

18,055－

19,698

9.1%－

21,286－22,9998.0%－

19,740－21,383

8.3%－

13,685－

16,20418.4%－

17,302－

19,50712.7%－

15,508－17,865

15.2%－

23,947－

27,66815.5%－

14,564－

17,341

19.1%

－

7,972

－

9,229

15.8%

Others

－

1,411

－

1,098

(22.2%)

Sales (JPY MM)－

29,373－33,19013.0%

Rooms Dept.

－

18,720－21,105

12.7%

Occupancy Rate

ADR
(JPY)

RevPAR(JPY)
Sales (JPY MM)
Rooms Dept.
F&B Dept.

First half ofthe year

Second halfof the year

－

9,335

－

10,915

16.9%

Others

－

1,317

－

1,170

(11.2%)

Sales (JPY MM)－

53,320－60,85814.1%－

33,284－38,44615.5%－

17,307－

20,144

16.4%

－

2,729

－

2,268

(16.9%)

－

7,464

－

9,183

23.0%

－

10,935－

12,57715.0%－

18,399－21,76018.3%

F&B Dept.

Rooms Dept.
F&B Dept.

Full year

OthersGOP(JPY MM)First half ofthe year
Second halfof the year
Full year<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

16<3> The 25 Hotels with Variable Rent, etc. (*)

First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year

Fiscal year ended December 2023
Comparison
Previous forecast Current forecastwith previous(first half actual) (first half actual)
forecast

Fiscal year ending December 2024
Comparison
Forecastwith previous
fiscal year

76.0%

76.0%

－

81.7%

5.7pt

82.9%

80.9%

(2.0pt)

84.3%

3.5pt

79.5%

78.4%

(1.0pt)

83.0%

4.6pt

16,618

16,618－18,35910.5%

18,771

19,7295.1%

21,173

7.3%

17,75018,234

2.7%

19,796

8.6%

12,628

12,628－15,00618.8%

15,563

15,9552.5%

17,858

11.9%

14,107

14,305

1.4%

16,44014.9%

26,221

26,221－30,492

16.3%

16,465

16,465－

19,675

19.5%

8,272

8,272

－

9,649

16.6%

Others

1,484

1,484

－

1,168

(21.3%)

Sales (JPY MM)

31,42432,211

2.5%

36,285

12.7%

Rooms Dept.

20,62921,1492.5%

23,671

11.9%

Occupancy Rate

ADR
(JPY)

RevPAR(JPY)
Sales (JPY MM)
Rooms Dept.
F&B Dept.

F&B Dept.

First half ofthe year

Second halfof the year

9,426

9,679

2.7%

11,36917.5%

Others

1,369

1,383

1.0%

1,245

(10.0%)

Sales (JPY MM)

57,64558,432

1.4%

66,777

14.3%

37,09537,614

1.4%

43,34715.2%

17,698

17,951

1.4%

21,017

17.1%

2,853

2,867

0.5%

2,413

(15.8%)

8,164

8,164

－

10,15024.3%

10,896

11,998

10.1%

13,744

14.5%

19,06020,162

5.8%

23,894

18.5%

Rooms Dept.
F&B Dept.

Full year

OthersGOP(JPY MM)First half ofthe year
Second halfof the year
Full year(*) The 25 Hotels with Variable Rent, etc., refer to the 25 hotels, consisting of the 16 HMJ hotels, plus the Accor Group Hotels and the Ishin Group Hotels.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

17<4> The 28 Hotels with Variable Rent, etc. (*)

First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year
First half ofthe year
Second halfof the year
Full year

Fiscal year ended December 2023
Comparison
Previous forecast Current forecastwith previous(first half actual) (first half actual)
forecast

Fiscal year ending December 2024
Comparison
Forecastwith previous
fiscal year

－

75.9%

－

82.0%

6.1pt

－

80.8%

－

84.6%

3.7pt

－

78.4%

－

83.3%

4.9pt

－

16,227－

17,89910.3%－

19,184－

20,578

7.3%－

17,764－

19,267

8.5%－

12,311－

14,67019.2%－

15,504－

17,40012.2%－

13,920－16,04315.2%－

27,046－31,55716.7%－

17,209－20,620

19.8%

－

8,345

－

9,759

16.9%

Others

－

1,492

－

1,177

(21.1%)

Sales (JPY MM)－

33,203－

37,469

12.8%

Rooms Dept.

－

22,031－

24,726

12.2%

Occupancy Rate

ADR
(JPY)

RevPAR(JPY)
Sales (JPY MM)
Rooms Dept.
F&B Dept.

First half ofthe year

Second halfof the year

－

9,778

－

11,488

17.5%

Others

－

1,393

－

1,254

(10.0%)

Sales (JPY MM)－

60,249－69,025

14.6%－

39,240－45,34615.6%－

18,124－

21,248

17.2%

－

2,885

－

2,431

(15.7%)

－

8,462

－

10,59025.2%－

12,388－14,25915.1%－

20,849－24,85019.2%

F&B Dept.

Rooms Dept.
F&B Dept.

Full year

OthersGOP(JPY MM)First half ofthe year
Second halfof the year
Full year(*) The 28 Hotels with Variable Rent, etc., refer to the 28 hotels, consisting of the 19 HMJ Hotels plus the Accor Group Hotels and the Ishin Group Hotels.

<Note> This document is intended to serve to publicly announce the revision of JHR’s operating and dividend forecasts for the fiscal year ended
December 2023 (24th period) and the operating and dividend forecasts for the fiscal year ending December 2024 (25th period). It should not
be construed as an offer of solicitation for investment. All investment decisions should be made solely at the investors' own discretion and risk.

18