ANNEX II
Template pre-contractual disclosure for the financial products referred to in Article 8, paragraphs
1, 2 and 2a, of Regulation (EU) 2019/2088 and Article 6, first paragraph, of Regulation (EU) 2020/852
Product name/Legal entity identifier:
Industrial & Infrastructure Fund Investment Corporation (IIF) (LEI: 353800WCHFY04YKYCI19)

Environmental and/or social characteristics
Does this financial product have a sustainable investment objective?
Yes
It will make a minimum ofsustainable investments with anenvironmental objective: ___%
in economic activities that
qualify as environmentally
sustainable under the EU
TaxonomyNo
It promotes Environmental/Social (E/S)
characteristics and while it does not have as
its objective a sustainable investment, it will
have a minimum proportion of ___% ofsustainable investmentswith an environmental objective in economic
activities that qualify as environmentally
sustainable under the EU Taxonomy

in economic activities that do
not qualify as environmentallywith an environmental objective insustainable under the EU

economic activities that do not qualify as

Taxonomyenvironmentally sustainable under the EU
Taxonomywith a social objective

It will make a minimum ofsustainable investments with asocial objective: ___%

It promotes E/S characteristics, but will notmake any sustainable investments

What environmental and/or social characteristics are promoted by this financial
product?
IIF is managed by KJR Management (the asset manager), an asset management company thatspecializes in Japanese real estate investment. IIF focuses on industrial and infrastructure
properties.
IIF has integrated the concept of responsible property investment (RPI) into our investment
management process. The RPI strategy is integrated into the asset management of IIF and is
implemented by all operational functions of the company during the entire ownership cycle, fromits acquisition to the ongoing asset management, marketing, renovation, and maintenance througha sale. In addition, ESG-related items are checked when properties are considered for acquisition.
As an integration of ESG at the time of management, the KPIs used to evaluate environmental andsocial performance are set and monitored.
IIF specifically promotes environmental and social characteristics as follows:•

Ensuring the quality of the buildings under our management through certifications and othermeans and addresses issues related to climate change and energy efficiency;•

Striving to improve building comfort and convenience and to raise the awarenessabout ESG among tenant employees.

•

Working together with our tenants and local community members to address the issues of
efficient water use and waste disposal. By strengthening the resilience of buildings throughdisaster prevention measures and the provision of community spaces, as well as social
contribution activities, IIF is committed to strengthening and improving connections withlocal people. By doing so, we will work to establish partnerships and build green
communities.

•

IIF does not designate a reference benchmark to measure the achievement of theenvironmental or social characteristics.
What sustainability indicators are used to measure the attainment of each of theenvironmental or social characteristics promoted by this financial product?
Indicators used to measure the attainment of these environmental and social
characteristics include:

Environmental indicators: GHG emissions; Scope1, Scope2 and Scope3 (PAI
18, Table 2)Energy consumption; Fuels, District Heating & Cooling and Electricity (PAI
19, Table 2)

Acquiring certifications

IIF works actively on energy conservation measures that relate to asset management,with the aim of creating a sustainable society through the reduction of environmental
impact. As part of our carbon risk measures, IIF collectively manages its energy
consumption and GHG emissions by outsourcing this work to external contractors; thishas enabled IIF to gather accurate and transparent data. IIF then analyzes this data aspart of continuing efforts at managing reductions in energy consumption.
IIF is responding to the problem of climate change, which is becoming more serious
year by year, by implementing environmental-friendly and energy-saving measuresand making efforts toward more efficient energy use in our properties to give greater
consideration to the environment and lessen our environmental impact. Also, toreduce GHG emissions, which are one of the risk factors for climate change, it hasestablished systems for understanding and managing GHG emissions in our portfolio
as a whole. IIF collectively manage electrical power, fuel, and water consumption
and analyze the accumulated data, which is both accurate and transparent toactively manage reduction of energy use.

What are the objectives of the sustainable investments that the financial productpartially intends to make and how does the sustainable investment contribute to suchobjectives?
N/A. IIF promotes environmental or social characteristics, but does not have a sustainable
investment objective and does not make sustainable investments.
How do the sustainable investments that the financial product partially intends to make,not cause significant harm to any environmental or social sustainable investment
objective?
N/A. IIF promotes environmental or social characteristics, but does not have a sustainable
investment objective and does not make sustainable investments.
How have the indicators for adverse impacts on sustainability factors been taken
into account?
N/A. IIF promotes environmental or social characteristics, but does not have asustainable investment objective and does not make sustainable investments.
How are the sustainable investments aligned with the OECD Guidelines forMultinational Enterprises and the UN Guiding Principles on Business and Human
Rights? Details:
N/A. IIF promotes environmental or social characteristics, but does not have asustainable investment objective and does not make sustainable investments.
The EU Taxonomy sets out a “do not significant harm” principle by which Taxonomyaligned investments should not significantly harm EU Taxonomy objectives and isaccompanied by specific EU criteria.
The “do no significant harm” principle applies only to those investments underlying thefinancial product that take into account the EU criteria for environmentally
sustainable economic activities. The investments underlying the remaining portion ofthis financial product do not take into account the EU criteria for environmentally
sustainable economic activities.
Any other sustainable investments must also not significantly harm any environmental
or social objectives.

Does this financial product consider principal adverse impacts on sustainability factors?
Yes
Our investments may have a principal adverse impact (PAI) on sustainability factors as defined inRegulation (EU) 2019/2088. The PAI throughout the investment cycles is measured and evaluatedwith the help of defined indicators based on the asset manager's ow n research.
IIF and its asset manager, KJR Management, recognize the importance of the principal adverse impacts onsustainability factors (hereinafter also Principal Adverse Impacts or PAI) are taken into account throughout
investment cycles.
PAIs describe the negative effects of the company’s business activities and countries in which the fund invests
regarding environmental, social and employee concerns, respect for human rights anti-corruption and bribery.
Therefore, the aim of IIF’s PAI strategy is to limit the negative influences on sustainability factors associatedwith its investment decisions. To this end, systematic procedures for measuring and evaluating, as well as
measures for dealing with PAI in investment processes are applied as explained below.

The PAI throughout investment cycles is measured and evaluated with the help of defined indicators based on
the asset manager's own research.
The following indicators are used that measure the PAI of IIF;
1. GHG emissions; Scope1, Scope2 and Scope3
2. Energy consumption; Fuels, District Heating & Cooling and Electricity
GHG emissions and Energy consumption data are provided by each energy supply vendor used to bill forelectricity and other services. This data is collected by a third-party property management company and stored
in a system provided by another third party. The collected data and the progress in reducing GHG emissions
and Energy consumption is reported on by IIF at the sustainability committee meetings, which aims to meetonce a quarter.
As an engagement to reduce GHG emissions and energy consumption which are PAI, we provide explanations
to our tenants about our environmentally friendly initiatives and facility renewal. When we renew facilities,
we install energy-efficient equipment through green leases through engagement with tenants. In this process,we hold dialogues with property management companies (third parties) and tenants regarding GHG emissions
and energy consumption of owned properties, including investigation of the causes in purpose of assessing,monitoring and mitigating PAI.
In order to fundamentally limit the negative sustainability impacts associated with the investments, IIF hastaken steps to install solar power generation and renewable energy, purchase green power and implement
energy-saving modification such as conversion to LEDs and updating air conditioning units which reduce GHG
emissions and Energy consumption.
Further information on PAIs can be found on IIF’s Environmental Performance.
Semi-Annual Report can be found on IIF’s IR Library.

No

What investment strategy does this financial product follow?
Our Responsible Property Investment (RPI) strategy is integrated into the asset managementof the investment corporations and is implemented by all of our operational functions during
the entire ownership cycle, from the acquisition of the asset to the ongoing asset management,
marketing, renovation and maintenance through sale. We are implementing our RPI strategy in
our investment and management process as follows:・Investment Decisions- Incorporate environmental and social risks into the evaluation criteria when acquiring,
selling or operating properties- Integrate RPI strategies, but not at the expense of long-term client financial performance
・Refurbishment- Incorporate RPI strategies into the design and financial analysis of all property renovations- Evaluate obtaining certifications applicable for each property type and location prior
to refurbishment to expedite approval process and enhance the property's competitive
position to maximize occupancy, rents and tenant quality- Engage with planners and other external project partners and consultants to achieve
objectives
・Operations and Maintenance- Define and implement best practice measures (priority on no costs and low costs) toimprove energy efficiency, water conservation and waste management for all operating
assets in order to promote sustainable practices- Reduce operating expenses and thereby increasing property values

- Evaluate obtaining green building certifications applicable for each property type andlocation in order to enhance the property's competitive position to maximize occupancy,
rents and tenant quality- Monitor changes in regulations and laws in order to adopt and implement RPI strategies- Collaborate with tenants, property managers and suppliers of services and materials toachieve objectives
As for the environment, IIF is continuously working on environmental and energy conservation
measures and energy efficiency improvement in the properties owned by the investment
corporation. IIF is implementing environmental-friendly and energy-saving measures and making
efforts toward more efficient energy use in our properties to give greater consideration to theenvironment and lessen our environmental impact. For example, IIF actively engages in theeffective use of water resources. IIF is engaged in initiatives to use water effectively by, forexample, use of water for on-site spraying of pumped water from 100 meters underground with
an automatic water supply device.
IIF provides neighboring communities and governments with spaces and public open spaces at
the real estate properties it owns. In addition, IIF provides tours of our facilities and otherservices to ensure that local residents are aware of the functions performed by our properties
in the area.
What are the binding elements of the investment strategy used to select theinvestments to attain each of the environmental or social characteristics promoted bythis financial product?
IIF delegates operations to its asset manager through the Asset Management Agreement.
Therefore, IIF follows an investment strategy established by the asset manager, which isd es cr i be d be lo w . The asset manager has an Environmental Charter that sets out ourenvironmental principles and actions, wherein it commits to climate action and thesustainable use of resources among other environmental objectives.
In addition, the asset manager has established a Sustainability Policy (renamed from
“Responsible Property Investment Policy”), based on this Policy IIF implements responsible
property investment (RPI) that integrates environmental, social, and governance (ESG)
elements into property investment. The concept of RPI incorporates environmental, social,and governance considerations into the investment and management process: investment
decisions, refurbishment, and operations and maintenance. In terms of investment
decisions, the asset manager incorporates environmental and social risks into theevaluation criteria when acquiring, selling, or operating properties. In terms ofrefurbishment, the key approach is to evaluate obtaining certifications applicable for each
property type and location prior to refurbishment to expedite approval process andenhance the property’s competitive position to maximize occupancy, rents, and tenantquality. Finally, in terms of operations and maintenance, the asset manager monitors
opportunities to obtain green building certifications, monitor regulatory and legal changes,
and continuously seek opportunities to implement best sustainability practices measures
such as those regarding resource efficiency.
IIF is responding to the problem of climate change, which is becoming more serious year
by year, by implementing environmental-friendly and energy-saving measures andmaking efforts toward more efficient energy use in our properties to give greater
consideration to the environment and lessen our environmental impact. Also, to reduce GHG
emissions, which are one of the risk factors for climate change, IIF has established systems
for understanding and managing GHG emissions in our portfolio as a whole.
What is the committed minimum rate to reduce the scope of the investments

considered prior to the application of that investment strategy?
The Fund does not commit to a minimum rate to reduce the scope of the investments
considered prior to the application of its investment strategy. However, given the natureof the Art. 8 Funds, the asset manager takes various environmental factors into
consideration such as property inspections, and land history investigations. In addition,
the asset manager investigates legal compliance, credit checks, and environmental risks
such as asbestos and polychlorinated biphenyls (PCBs) based on an ESG checklist usedduring the due diligence process, which includes ESG-related items to be checked.
What is the policy to assess good governance practices of the investee companies?
IIF invests mainly in real estate. KJR Management is the asset manager for IIF. In the courseof making decisions regarding the acquisition, disposal, or operation and management ofassets, approval is obtained from the Investment Committee and the Senior Advisory
Board/Board of Directors. The asset manager takes various environmental factors into
consideration such as property inspections, and land history investigations. In additions,the asset manager investigates legal compliance, credit checks, and environmental risks
such as asbestos and PCBs based on ESG checklists.

What is the asset allocation planned for this financial product?
IIF’s asset allocation is mainly in real estate assets. IIF has the following indicators;
・Acquiring certifications
・GHG emissions (absolute): 42% reduction by 2030 compared to 2021 (Scope1+2)
・Energy consumption (per unit): Reduce by 30% in 2030 compared to 2015
The above three indicators are considered to determine whether investments are aligned with
E/S characteristics. An asset is considered to be consistent with E/S characteristics when it
meets one of the above three criteria.
Investments#1 Aligned with E/SCharacteristics
31. 0%#1B Other E/S
Characteristics
31.0 %#2 Other Real Estate(Not aligned with E/Scharacteristics)
69.0%

As of July 31, 2023, 31.0% of the properties in the portfolio met one of the above criteria and weredeemed aligned with E/S characteristics, and 69.0% were not aligned with E/S characteristics basedon gross floor area.
#1 Aligned with E/S characteristics includes the investments of the financial product used to attain the environmental
or social characteristics promoted by the financial product.
#2Other includes the remaining investments of the financial product which are neither aligned with the environmental
or social characteristics, nor are qualified as sustainable investments.

How does the use of derivatives attain the environmental or social characteristics
promoted by the financial product?
IIF uses derivatives for hedging market risks (mainly interest rate swaps) purposes only.
Therefore, this is not relevant to achieving ESG characteristics.

To what minimum extent are sustainable investments with an environmental objectivealigned with the EU Taxonomy?
IIF does not have sustainable investments aligned with the EU taxonomy, so there is no alignment
with the taxonomy for each item (0%)
Does the financial product invest in fossil gas and/or nuclear energy related
activities that comply with the EU Taxonomy1?
Yes:
In fossil gas

In nuclear energy

No
The two graphs below show in green the minimum percentage of investments that are aligned with
the EU Taxonomy. As there is no appropriate methodology to determine the Taxonomy-alignment ofsovereign bonds*, the first graph shows the Taxonomy alignment in relation to all the investmentsof the financial product including sovereign bonds, while the second graph shows the Taxonomy
alignment only in relation to the investments of the financial product other than sovereign bonds.
1．Taxonomy-alignment of investments including sovereign bonds

Taxonomy-aligned
Non Taxonomy-aligned

2．Taxonomy-alignment of investments excluding sovereign
bonds

Taxonomy-aligned

100%

Non Taxonomy-aligned

100%This graph represents 100% of the total investments*

For the purpose of these graphs, ‘sovereign bonds’ consist of all sovereign exposures.

As shown in the graphs above, percentage of Taxonomy alignment is equal to 0%.
What is the minimum share of investments in transitional and enabling activities?
This item is not applicable since the fund does not have sustainable investments which align with EU
Taxonomy.
Enabling activities directly enable other activities to make a substantial contribution to an environmental
objective.
Transitional activities are activities for which low‐carbon alternatives are not yet available and among others
have greenhouse gas emission levels corresponding to the best performance.

What is the minimum share of sustainable investments with an environmental objectivethat are not aligned with the EU Taxonomy?
This item is not applicable since the fund does not have sustainable investments.

1

Fossil gas and/or nuclear related activities will only comply with the EU Taxonomy where they contribute tolimiting climate change (“climate change mitigation”) and do not significantly harm any EU Taxonomy objective - see explanatory
note in the left hand margin. The full criteria for fossil gas and nuclear energy economic activities that comply with the EU Taxonomy
are laid down in Commission Delegated Regulation (EU) 2022/1214.

are sustainable investments with an environmental objective that do not take into account the criteria
for environmentally sustainable economic activities under the EU Taxonomy.

What is the minimum share of socially sustainable investments?
This item is not applicable since the fund does not have sustainable investments.

What investments are included under “#2 Other”, what is their purpose and are there
any minimum environmental or social safeguards?
Investments included under “#2 Other” equal to 69.0% because the fund does not include
sustainable investments. “#2 Other” includes properties without green building certifications. Even if
certification is not obtained, IIF will continue to implement operations for properties that meetenvironmental and social characteristics.

Is a specific index designated as a reference benchmark to determine whether thisfinancial product is aligned with the environmental and/or social characteristics that it
promotes?
IIF does not designate a reference benchmark.
How is the reference benchmark continuously aligned with each of theenvironmental or social characteristics promoted by the financial product?
IIF does not designate a reference benchmark.
How is the alignment of the investment strategy with the methodology of
the index ensured on a continuous basis?
IIF does not designate a reference benchmark.
How does the designated index differ from a relevant broad market index?
IIF does not designate a reference benchmark.
Where can the methodology used for the calculation of the designated index
be found?
IIF does not designate a reference benchmark.
Reference benchmarks are indexes to measure whether the financial product attains theenvironmental or social characteristics that they promote.

Where can I find more product specific information online?
More product-specific information can be found on the website:
Our overarching sustainability strategy can be found here:
Strategy; https://kjrm-sustainability.disclosure.site/en/themes/94/
IIF: https://iif-reit_sustainability.disclosure.site/en/