(TSE Code: 8982)

Top REIT, Inc.

Presentation on
Business Results forthe 13ｔｈ Fiscal Period
Ｍａｙ 1, 2012－
Ｏｃｔｏｂｅｒ 31, 2012

Ｄｅｃｅｍｂｅｒ 14, 2012

IndexTopics:V. Management Results at the Thirteenth fiscal Period

・ Overview since ListingV-1. Operating Results：History of Asset GrowthV-2. Appraisal Value as at End of Period

I. Overview of Business Results of the Thirteenth Fiscal Period(Ended October 31, 2012)

V-3. Appraisal Cap Rate

I-1. Highlights of 13th Fiscal Period①

V-5. Operating Results：Rent Revisions (excluding residential)

V-4. Operating Results：History of Occupancy Rate

I-2. Highlights of 13th Fiscal Period②
I-3. Summary of the Thirteenth Fiscal Period

VI. Thirteenth Fiscal Period Results (Ended October 31, 2012)
Vl-1. Statements of Income (Summary) / Statements of Cash Distributions

II. 14th FP and 15th FP Forecasts

Vl-2. Balance Sheets (Summary)II-1. Preconditions for 14th FP and 15th FP Forecasts

VI-3. Major Financial Indicators

II-2. 14th FP and 15th FP Forecasts

VI-4. Unitholders

II-3. Results of Past Periods and Forecasts (Detail)Vl-5. Unit Price Performance and Volume (Mar 1, 2006 –November 30, 2012)

III. The Current Management Policy and Growth Strategy

VIl. Appendix: Portfolio Overview

III-1. Market Prospects

VIl-1. Portfolio Map (as at end of 13th FP)

III-2. Current Facing Issue and Management Policy

VII-2. Portfolio Summary (as at end of 13th FP)

III-3. Leasing of Harumi Island Triton Square Office Tower Y

VIl-3. Portfolio Overview (as at end of 13th FP)

III-4. Superior Point of Harumi Island Triton Square Office Tower Y

VII-4. Operating Income by Property (Thirteenth Fiscal Period)

III-5. Rent Revisions

VII-5. Property Details：Office Buildings

III-6. Growth Strategy for the Next Stage

VII-6. Property Details：Residential
VII-7. Property Details：Retail Properties and Other Properties

IV. Financial Strategies
IV-1. Financial Strategies: Stable Financial management
IV-2. Financial Strategies: Financial Status / Extending Borrowing Periods
IV-3. Financial Strategies: Issuer Rating and Loans at End of Thirteenth Fiscal Period

VIlI. Appendix: Structure of Related Parties
VIlI-1. Characteristics of Top REIT and Operational Strategies
VIlI-2. Overview of Asset Manager

1

TOPICS． Overview since Listing
4th・5th・6th FP

1st・2nd・3rd FP
Mar. 1, 2006 – Oct. 31, 2007

10ｔｈ・11th・12ｔｈ FP

13th FP

Nov. 1, 2010－ Apr. 30, 2012

May 1, 2012－
Oct. 31, 2012

7th・8th・9th FP
May 1, 2009 － Oct. 31, 2010

Nov. 1, 2007－ Apr. 30, 2009

Financial Status

IPO:
IPO: 82.
82.2626 bnbn
Offering Price:¥550,000 per unit

14th FP
Nov. 1,2012Apr. 30 2013

Jun. 2010
Investment Corporation Bonds Issued

Dividend

1st
End of FP
Debt¥35.9bn

2nd
End of FP
Debt¥54.3bn

3rd
End of FP
Debt¥54.4bn

4th
End of FP
Debt¥83.0bn

5th
End of FP
Debt¥82.0bn

6th・7thEnd of FP
Debt¥81.74bn

8th
End of FP
Debt¥94.24bn

ＬＴＶ
28.0％

ＬＴＶ
37.1％

ＬＴＶ
37.3％

ＬＴＶ
47.4％

ＬＴＶ
47.3％

ＬＴＶ
47.3％

ＬＴＶ
50.6％

1st
1st
¥17,609¥17,609

2nd
2nd¥14,992¥14,992

3rd
3rd¥11,921¥11,921

4th
4th¥11,884¥11,884

5th
5th¥12,863¥12,863

6th
6th¥13,206¥13,206

7th
7th¥12,654¥12,654

8th
8th¥13,484¥13,484

9th
End of FP
Debt （※）¥94.17bn
ＬＴＶ
50.5％

10th
End of FP
Debt （※）¥94.10bn
ＬＴＶ
50.5％

11th
End of FP
Debt (※)¥94.03bn
ＬＴＶ
50.7％

12th
End of FP
Debt (※)¥96.97bn
ＬＴＶ
51.5％

13th
End of FP
Debt (※)¥96.90bn
ＬＴＶ
51.4％

9th
9th
¥14,220¥14,22010th
10th¥13,922¥13,92211th
11th¥12,809¥12,80912th
12th¥12,577¥12,577

13th
13th¥12,912¥12,912(※) Includes Investment
Corporation Bonds

Sep. 2012
OthersNippon Steel City Produce, Inc. (currently
Nippon Steel Kowa Real Estate Co., Ltd.)
withdrew as Top REIT sponsor(billion yen)

OfficeRetail

200
180
160

External Growth

140
120

7
properties¥104.386bn

8properties¥113.286bn

Listing

1st FP

11
properties¥130.846bn

Residental

13
properties¥157.187bn

Other
17
properties¥177.435bn

15 properties¥175.047bn

14 properties¥162.347bn

18
properties¥184.345bn

100
80
60
40
20
0

2nd FP

3rd FP

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP

13th FP2

I． Overview of Business Results of the Thirteenth Fiscal Period（Ended October 31, 2012）3

I - 1. Highlights of 13th Fiscal Period ①《《 Existing
Existing Properties
Properties 》》◆ Leasing of Akasaka Oji Building
・ Leased up office space during 13th FP◆ Improvement of occupancy rate・ 【Office buildings】
・ 【Residential】
・ 【Portfolio】

Period average
Period average
Period average

12th FP: 95.9% ⇒ 13th FP: 98.8% ( 2.9% pt↑)
12th FP: 94.3% ⇒ 13th FP: 95.6% ( 1.3% pt↑)
12th FP: 97.7% ⇒ 13th FP: 99.1% ( 1.4% pt↑)

◆ Rent revision
・ Minimized range of decrease in rent ( 0.9% ↓)in rent revision with 8 office building tenants (approx. 2.5% of portfolio’s rent at end of 12th FP)◆ Receipt of lease agreement termination notice from major tenant
・ Harumi Island Triton Square Office Tower Y major tenant, Nippon Steel & Sumitomo Metal Corporation (formerly Sumitomo Metal Industries, Ltd.),
to move out of the office building
Jan. 31, 2013: Vacate approx. 2,340 tsubos (65.0% of the tenant’s leased floor area)
8F-13F and 15F for total of 7 floors
Feb. 28, 2013: Vacate approx. 1,175 tsubos (32.6% of the tenant’s leased floor area)
Approx. 3,600 tsubos (100%)
Mar. 31, 2013: Vacate approx.
85 tsubos ( 2.4% of the tenant’s leased floor area)scheduled to be vacated by end of Mar. 2013
Approx. 4.0% of portfolio’s floor area
Approx. 51.3% of the office building’s floor area《《 Financial
Financial Strategy
Strategy 》》◆ Refinanced total amount of ¥17.5 billion in June 2012
・ ¥8.5 billion (5-year fixed-rate) + ¥9.0 billion (over 2-year floating-rate) ⇒Total amount of ¥17.5 billion, refinanced into 5-year long-term loan payble¥8.5 billion Fixed interest rate through execution of interest rate swap agreement¥9.0 billion Borrowed with floating interest rate

【Average remaining period End of 12th FP: 2 years and 7 months → End of 13th FP: 3 years】【Ratio of loans with fixed interest rate End of 12th FP: 51.0% → End of 13th FP: 50.9%】
4

I - 2. Highlights of 13th Fiscal Period ②《《 Dividend
Dividend 》》【Declared Dividend per Unit of ¥12,912 】
・ Compared to forecast: Increase in dividend of ¥512《《 Sponsor
Sponsor Change
Change 》》◆ Nippon Steel City Produce, Inc. (currently Nippon Steel Kowa Real Estate Co., Ltd.)
withdrew as Top REIT sponsor as of Sep. 28, 2012
・Transferred of Nippon Steel City Produce’s entire shares in Asset Manager (31% of shares issued and outstanding) to Sumitomo Mitsui Trust Bank, Limited

Composition of Asset manager’s sponsor

Sponsors

Sumitomo Mitsui Trust
Bank, Limited.

69.0%

SupportOji Real Estate Co., Ltd. 31.0%

・ No changes to the investment policy of Top REIT and to the asset management structure.
・ Continuously collaborated with sponsors, focus most on issues Top REIT faces and external growthby utilizing cultivated asset management skill.
・ For PM/ML services entrusted to Nippon Steel Kowa Real Estate, no change to be scheduled at present.

5

I - 3. Summary of the Thirteenth Fiscal Period
13th FP Results
May 1, 2012 October 31, 2012

13th FP Forecast(Announced onJune 14,2012)

Period of asset
management (days)

184

184

-

-

182

-

-

Operating revenue¥5,636mn¥5,621mn

¥14mn

0.3%

¥5,693mn(¥57mn)(1.0%)

Operating income¥2,697mn¥2,631mn

¥65mn

2.5%

¥2,772mn(¥75mn)(2.7%)

Ordinary income¥2,002mn¥1,923mn

¥79mn

4.1%

¥2,029mn(¥26mn)(1.3%)Net income¥2,001mn¥1,922mn

¥79mn

4.1%

¥1,999mn

¥2mn

0.1%

155,000

155,000--

155,000--¥12,912¥12,400

¥512

4.1%

¥12,577

¥335

2.7%

Number of properties

18

18

0

-

18

0

-

Appraisal value total¥173,800mn

-

-

-

¥179,000mn(¥5,200mn)(2.9%)

Items

Number of units issued
and outstanding (unit)
Dividend per unit (yen)12th FP Results
November 1, 2011 April 30, 2012

Net Change(Results vs. Forecast)■ Differences between Forecasts and Actual Results
Operating Revenue:＋¥14mn
 Minimization of range of decrease in rent at time of rent revision led to increase in rent
revenue Increase in residential contract renewal rate (compared to projections) led to receipt ofcontract renewal fee income

Operating Income:＋¥65mn
 Revision of taxes and dues (property tax and city planning tax) led to decrease in costs
 Reduced property management expenses
 Increase in residential contract renewal rate led to decrease in expenses for restoring tooriginal condition …etc.

Ordinary Income:＋¥79mn
 Decrease in interest rate costs (hedging by low interest rate level (compared toprojections) at execution of interest rate swap agreement)

Net Change(13th FP Results vs.
12th FP Results)■ Other References
Items

13th FP Results

12th FP Results

42

40

300,294.23㎡

300,294.23㎡

Occupancy rate

99.2％

98.5％

Depreciation andamortization¥1,116mn¥1,072mn

Capital expenditures¥108mn¥442mnTerm-end unit price¥371,000¥451,500

Term-end market
capitalization¥57,505mn¥69,982mn

Number of tenants
Total rentable floor space6Ⅱ． 14th FP and 15th FP Forecasts7

II - 1. Preconditions for 14th FP and 15th FP Forecasts
Preconditions for Forecast of Earnings Results
14th FP (Ending of April, 2013)
Portfolio Assets

15th FP (Ending of October, 2013)

Preconditioned on 18 properties held by Top REIT as of December 14, 2012

Number of Units Issued
and Outstanding

Interest-Bearing
Liabilities

155,000 Units・As of end of 14th FP: ¥94,835 million (Anticipated repaymentof ¥67 million as agreed upon)
・The ¥9,800 million loan payable due for repayment on November 30,
2012 was fully refinanced
・It is assumed that the ¥12,100 million due for repayment on
March 27, 2013 , of which ¥2,000 million will be repaid
using cash on hand and ¥10,100 million will be refinanced.

Tenants for Harum
Island Triton Square
Office Tower Y・As of end of 15th FP: ¥94,767 million (Anticipated repayment of ¥67
million as agreed upon)

It is assumed that space subject to lease agreement termination finalized as of Dec. 14, 2012 will be vacant
For the 24.2% of total rents (as of the end of 13th FP) scheduled forrent revision, assuming in certain level of decrease in rent
It is assumed that property tax, etc. will be ¥564 million anddepreciation and amortization will be ¥1,121 million

For the 9.7% of total rents (as of the end of 13th FP) scheduled for rent
revision, assuming in certain level of decrease in rent
It is assumed that property tax, etc. will be ¥580 million anddepreciation and amortization will be ¥1,108 million

Non-Operating
Expenses¥624 million (interest on loans, interest expenses on investment
corporation bonds and related expenses: ¥617 million)¥596 million (interest on loans, interest expenses on investment
corporation bonds and related expenses: ¥592 million)

Dividend

It is assumed that there is no reversal of internal reserves ( ¥78 million).

It is assumed that there is fully reversal of internal reserves ( ¥78
million).

Rent Revisions
Operating Expenses

Monthly Schedule of Rent Revisions (excluding residential)（mn yen） 240*Based on
monthly rent

200
80
60
40
20
0
Nov. 2012

Dec. 2012 Jan. 2013

Feb. 2013

14th FPMar. 2013

Apr. 2013

May. 2013

Jun. 2013

Jul. 2013

Aug. 2013

Sep. 2013

Oct. 2013

15th FP

8

II - 2. 14th FP and 15th FP Forecasts
OperatingOperating Income
Income(million yen)

7,000
6,060
5,814

6,000

5,584

5,000

4,715

4,817

3rd FP

4th FP

5,606

5,967

Posted revenue equivalent to
expenses for restoring to original
condition(￥451mn) due to a major
tenant moving out of Harumi Island
Triton Square Office Tower Y

5,812

5,828
5,693

5,608

5,636

451
5,376

4,935

4,526
4,037
4,000

3,000
1st FP

2nd FP

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP 11th FP 12th FP 13th FP 14th FP 15th FP(Forecast)(Forecast)
Posted expenses for restoring
to original condition(￥451mn)
due to a major tenant moving
out of Harumi Island Triton
Square Office Tower Y

OperatingOperating Expenses
Expenses(million yen)

4,000

2,933
3,000

2,000

2,465

2,464

3rd FP

4th FP

2,905

2,978

2,964

3,041

2,995

3,033

2,921

2,939

3,420
451

2,945

2,968

1,878
1,610

1,000

0
1st FP

2nd FP

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP 11th FP 12th FP 13th FP 14th FP 15th FP(Forecast)(Forecast)*The actual number of days in the First Fiscal Period was 245. The above numbers are calculated by the following calculation method: (First Fiscal Period Results / 245 Days) x 365 Days / 2.
In addition, the above forecast figures are calculated under certain preconditions as of the date of this material and are subject to change. Moreover, the dividend is not guaranteed.

9II - 2. 14th FP and 15th FP Forecasts
OperatingOperating Income
Income(million yen)Net
Net Income
Income(million yen)

4,000

3,000

2,647
2,427

2,651
2,250

2,323

2,849 3,019 2,971 2,779 2,772

2,700

3,000

2,697

2,630

2,033
2,000

2,407

2,353

1,847 1,841 1,993

2,046 1,961 2,090

2,204 2,157

1,985 1,999

2,001
1,782

1,990

1,422

2,000
1,000

1,000

0

0

1st FP 2nd FP 3rd FP 4th FP 5th FP 6th FP 7th FP 8th FP 9th FP 10th FP 11th FP 12th FP 13th FP 14th FP 15th FP(Forecast)(Forecast)

Dividend
Dividend(yen)

16,000

1st FP 2nd FP 3rd FP 4th FP 5th FP 6th FP 7th FP 8th FP 9th FP 10th FP 11th FP 12th FP 13th FP 14th FP 15th FP(Forecast)(Forecast)

14,992
14,22013,116

12,863

13,206

13,484

12,809 12,577

12,654

11,921 11,884

12,00013,922
12,912
11,500

9,500
8,000

4,000
1st FP

2nd FP

3rd FP

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP 11th FP 12th FP 13th FP 14th FP 15th FP(Forecast)(Forecast)*The actual number of days in the First Fiscal Period was 245. The above numbers are calculated by the following calculation method: (First Fiscal Period Results / 245 Days) x 365 Days / 2.
In addition, the above forecast figures are calculated under certain preconditions as of the date of this material and are subject to change. Moreover, the dividend is not guaranteed.

10II - 3. Results of Past Periods and Forecasts (Detail)Item

8th Fiscal
Period

9th Fiscal
Period10th Fiscal
Period11th Fiscal
Period12th Fiscal
Period13th Fiscal
Period14th Fiscal
Period(Forecast)

15th Fiscal
Period(Forecast)

Period of asset
management (days)

181

184

181

184

182

184

181

184

Operating revenue¥5,814mn¥6,060mn¥5,967mn¥5,812mn¥5,693mn¥5,636mn¥5,828mn¥4,935mn

Operating expenses¥2,964mn¥3,041mn¥2,995mn¥3,033mn¥2,921mn¥2,939mn¥3,420mn¥2,945mn¥711mn¥783mn¥741mn¥809mn¥702mn¥702mn¥1,185mn¥726mn¥567mn¥586mn¥586mn¥609mn¥608mn¥565mn¥564mn¥580mn¥1,127mn¥1,081mn¥1,086mn¥1,060mn¥1,072mn¥1,116mn¥1,121mn¥1,108mn

Operating income¥2,849mn¥3,019mn¥2,971mn¥2,779mn¥2,772mn¥2,697mn¥2,407mn¥1,990mn

Ordinary income¥2,091mn¥2,204mn¥2,194mn¥1,986mn¥2,029mn¥2,002mn¥1,783mn¥1,394mn

Net income¥2,090mn¥2,204mn¥2,157mn¥1,985mn¥1,999mn¥2,001mn¥1,782mn¥1,422mn

Net operationg income
from property leasing¥4,535mn¥4,691mn¥4,639mn¥4,393mn¥4,126mn(Note1)¥4,368mn¥4,078mn¥3,628mn

ＦＦＯ¥3,217mn¥3,286mn¥3,243mn¥3,046mn¥2,815mn¥3,117mn¥2,904mn¥2,531mn

Number of units issued
and outstanding (units)

155,000

155,000

155,000

155,000

155,000

155,000

155,000

155,000

Dividend per unit

¥13,484¥14,220¥13,922¥12,809¥12,577¥12,912¥11,500¥9,500FFO per unit

¥20,755¥21,200¥20,929¥19,654¥18,165¥20,113¥18,738¥16,330

Of which, expenses
related to rent business(excluding taxes and dues, anddepreciation and amortization)

Of which, taxes anddues
Of which, depreciation
and amortization

Note1: Net operating income from property leasing of 12th Fiscal Period excluded capital gains by disposition of property.
Note2: The forecasts should not be construed as a guarantee of the actual dividends

11III ． The Current Management Policy and Growth Strategy

12III - 1. Market Prospects[Present state]

Real
Real Estate
Estate Leasing
Leasing Market
Market◆ Large supply of office buildings in Central Tokyo settling down and signsof improvement in vacancy rate, but still in state of fluctuation◆ Office rent levels still remain weak, though the range of decrease in rent
levels has decelerated◆ Studio and family residences with high convenience has continued toshow steady performance[Present state][Present state]◆ Vacancy rate of office buildings in Central Tokyo will improve gradually◆ Large overseas economic impact and still strong sense of uncertainty
over economy and corporate earnings suggest recovery in officebuilding rent will be likely to require a substantial amount of time due to⇒ Top REIT’s strategy
Focus most on leasing up vacant space of Harumi Island Triton
Square Office Tower Y

RealReal Estate
Estate Transaction
Transaction Market
Market◆ Buyers show strong willingness to buy, but information on high-grade
office properties available for sale is limited(repayment of borrowings is primarily being conducted through refinancedue to the improved financing environment)◆ The market for rental residential property transactions remains steady◆ While real estate transaction amounts are increasing compared toprevious year, acquisitions of property from sponsors based on IPO of
new REITs and PO of existing REITs are the main

[Future prospects]◆ Price of high-grade office properties will be on upward trend, given the
scarce office properties available for sale and REITs’ and otherbuyers’ strong willingness to buy◆ Market for rental residential property transactions will remain steady,but tend to overheat in Central Tokyo and the Tokyo Metropolitan Area
⇒ Top REIT’s strategy
Focus on acquisitions by gathering information of high-grade
properties available for saleFinancial
Financial // Capital
Capital Market
Market◆De facto zero interest rate monetary policy maintained and continued by
the Bank of Japan◆Fund procurement environment is relatively favorable, with financial
institutions maintaining positive lending attitude◆With Bank of Japan’s monetary easing, increase of the purchaseamount and intermittent purchase of J-REIT units, system reform moves
for J-REIT market revitalization, etc., J-REIT market conditions are on
recovery trend. IPO and PO also active, leading to inflow of funds to JREITs[Future prospects][Future prospects]◆ Market interest rates will remain stable at low levels for some time
◆ Moves of J-REIT asset doubling plan (diversification of J-REIT fundprocurement means) for pulling out of deflation will gain momentum.
Positive impact for J-REIT market conditions.
◆ Close monitoring of future domestic political situation and European,
U.S., Chinese and other overseas finance and economy will be
required⇒ Top REIT’s strategy
Strive to implement steadily refinance.

13

III - 2. Current Facing Issue and Management Policy

Current Management Policy
Top priority
issue◆ Secure foothold for revenues
through flawless management of existing properties ◆● Aim to minimization of downtime
by focusing on leasing up vacancy space in Harumi Island Triton Square Office Tower Y
and other vacant space● Minimize range of decrease in rent revision and prevent tenants from moving out
by conducting persistent negotiations utilizing tenant relations
Especially, focus most on large scale rent revision at April, 2013

◆ Stable financial management ◆– Well-balanced refinancing
while reducing costs –– Efficient utilization of cash on hand –● 14th FP:¥9.8 billion due on Nov. 30 (completed)¥9.3 billion and ¥2.8 billion due on Mar. 27(to be scheduled)◆ Accumulate greater revenues
by acquisition of new properties ◆– Utilize sponsors’ strengths
as well as various information channels –●Superior office properties with excellent
location in Central Tokyo andmajor cities across the country○Given that residential property transactions
are on a trend of overheating, consider carefully

14

III - 3. Leasing of Harumi Island Triton Square Office Tower Y~ High convenience of symmetricalcolumn-free space ~Leasing Policy[Policy]“Aim to minimization of downtime”●By end of Jan. 2013 (by completion of work for restoring to original condition
conducted on part of vacated space)・ Leasing activities premised on leasing on floor basis●In and after Feb. 2013 (after completion of work for restoring to original
condition conducted on part of vacated space)・Leasing activities with target expanded to also small- to medium-sizedtenant needs with eye on floor partitioning (up to about 4 partitions assumed)

Leasable spacestandard floor area

1,868.42m2(approx. 565.19
tsubos)Floor load 500kg/㎡

Form “leasing team” comprised of staff appointed fromasset manager, property managers and sponsors.
Implement activities, while sharing information.

Leasing activities that bring together
the collective strengths of Top REIT
~ Status of agreement
termination by floor ~Total ofapprox.
4,100 tsubos
to be vacated by
end of Mar. 2013

*The floor area to be vacatedshown to the right includes
storage space, etc. on the floor.

Leasing Status

Floor

Floor area
to be vacated (tsubos)

Agreementtermination date

15F

Approx. 580

Feb. 28, 2013

14F

・ Number of inquiries： 66 cases
・ Property viewings for brokers: Held for 2 days
(Oct.18 and 19, 2012)

Jan. 31, 2013

・ Number of property viewings for potential candidates:
14 cases(mainly tenants looking for floor area about 1,000
tsubos – 3,000 tsubos)

Approx. 590

Feb. 28, 2013

・ Candidate tenants currently considering: 6 cases

Approx. 580

Mar. 31, 2013

Approx. 15

Mar. 31, 2013

13F

Approx. 580

12F

Approx. 580

11F

Approx. 595

10F

Approx. 580

9F
8F
7F
~
4F
3F

as of Nov. 30, 2012

Approached by companies of various business types,
but limitations to property viewing during period of
occupancy by current tenant and work for restoring tooriginal condition.

15

III - 4. Superior Point of Harumi Island Triton Square Office Tower Y
Superior Point ofHarumi Island Triton Square Office Tower Y~ In addition to trains, also many bus routes ~Accessible from various stations by using Toei Bus (Route To-03 andIndividually-controllable air-conditioning
systems dividing office space into 12 zones,
2.7m ceiling height, 100mm raised flooringand other high specifications
as same as the latest office buildings
High convenience ofsymmetrical column-free spacewith standard floor area of approx.
560 tsubos
Supported directly by
30m underground solid foundation
Foundation not susceptible toliquefaction
Enriched emergency measures,
equipped with emergency power
generator and heat storage tank, etc.

To-05), Edo Bus (South Circulation Route) and new route (Harumi Liner)

Oct. 13, 2012
Bus stop locatedStart of “Harumi Liner” connecting

below ground lobby
within Triton Square.

Triton Square ⇔ Tokyo and Yurakucho Stations

EnablesRequired Time; approximately 20 minutes

comfortable travel
to and from workwithout getting wetTokyoon rainy days

Stations

possible.
Yurakucho
Stations

Reducing heat island effectthrough water environment andgrowing flowers and greenery…etc.

~ Advanced design providing security ~Shinbashi
Stations

Vibration
control
deviceHarumi
Triton Square

Office towerearthquake-resistant design

Connecting vibration
control bridge

New route (Harumi Liner)
Edo Bus (South Circulation Route)Toei Bus (Route To-03)
Toei Bus (Route To-05)

16

III - 5. Rent Revisions「Tenants First」 Policy = 「Maintaining and Improving tenants satisfaction」
Maintain and enhance asset value by discerning and appropriately incorporating tenant needs
Secure stable revenue for the long term by creating a favorable relationship with superior tenants

Monthly Schedule of Rent Revisions (excluding residential)（mn yen）*Based on monthly rent

Harumi Island Triton Y (parts of tenants)

240

Harumi Island Triton Z

200

Kanda Nishiki-cho 3-chome Building
14th
FP

80

Akasaka Oji Building (parts of tenants)
Shiba-Koen Building (parts of tenants)
Kanda Park Plaza (parts of tenants)

60

12
Tenants
24.2% oftotal rents(as of end of
13th FP)

Faret East Building (parts of tenants)

40

Shinkawa Chuo Building (parts of tenants)
Shiba-Koen Building (parts of tenants)

20
0

15th
FP
Nov. 2012 Dec. 2012

Jan. 2013

Feb. 2013

Mar. 2013

Apr. 2013

May. 2013

Jun. 2013

Jul. 2013

Aug. 2013 Sep. 2013

Oct. 2013

Kanda Park Plaza (parts of tenants)
Faret East Building (parts of tenants)
Sagamihara Shopping Center （IY）

14th FP

7
Tenants
9.7% oftotal rents(as of end of
13th FP)

15th FP

Conduct persistent negotiations using the good relations with tenants

17III - 6. Growth Strategy for the Next Stage

GrowthGrowthMethods
Methods

Continued Implementation of Growth Strategy for the Next Stage◆ Fully utilize the Top REIT Edge 【 Sponsor Strength 】 【 Superior Portfolio 】◆ Implement growth strategy with an extreme focus on the dividend level◆ While securing a foothold for revenues, acquire competitive and highly profitable properties

GrowthGrowthStrategy
Strategy◆ Flexibly select fund procurement means according to the market environment
・Bank loans: Flexibly utilize strong bank formation
・Investment corporation bonds: Consider in view of market environment, etc.
・Capital increases through public offerings: Consider investment unit price levels and property returns,
as well as amount of net assets and dividend◆ Consider M&A and joining of new sponsors （Consider rebuilding sponsor structure that will contribute to Top REIT’s growth in collaboration with sponsors ）Next Stage
Asset
Asset Size
Size

Next stage

Achieve ¥210.0bn

１５

Asset size: ¥210bn
No. of properties: around 20 – 23
LTV: 40 – 50%

Acquisitions ofadditional ¥26bn
Appropriately
control LTV(No. of２０
Properties)

Further Leap
Forward

End of 13th FP
Asset size: ¥184.345bn
No. of properties: 18
LTV: 51.4%

TargetingTargeting asset
asset size
size ofof ¥210bn,¥210bn,reducing
reducingNEC
NECHeadHead Office
OfficeBuilding’s
Building’s
share
share ofofthe
the portfolio
portfolio toto 20%
20%

１０¥170bn¥180bn¥190bn¥200bn¥210bn(Asset Size)

18

IV ． Financial Strategies

19IV - 1. Financial Strategies: Stable Financial Management
Financial Policies (Stable Financial Management)
Maintain stable bank formationand secure financial flexibility

Changes in Fund Procurement Status (Debt)

Short-Term

LTV(billion yen)

Extend Borrowing Periods and Spread
Out Repayment Dates

60%
47.4%

100

Manage Risk of Fluctuating Interest
Rates

37.1%

80
60

The market interest rate is currently low and stable. Inview of the risk of future interest rate fluctuations,
Top REIT will in the meantime operate with a ratio of
fixed-rate interest borrowings of 50% while enjoying
the present benefits.

Long-Term

120

27.8%

37.3%

47.3%

10.3

9.3

47.3%

13.3

47.3%

6.7

6.7

50.5%

50.7%

51.5%

51.4%
50%
40%

28.0%

30%
87.5

2.5

72.7

72.7

54.4
20

50.5%

13.3

20.9
40

50.6%

33.4

33.4

33.4

IPO

1st FP

2nd FP

68.5

94.1

87.5

94.0

97.0

96.9
20%

68.5

Conduct operation with a target ratio of loans to total assets(LTV) of around 50% in contrast to the 60% ceiling0Manage Risk of Fluctuating Interest Rates

0%

16.2%

16.2%

7.1%

80%

60%

60%

83.8%

83.8%

92.9%

92.9%

100.0%

100.0%

100.0%

37.9%

20%

LongTerm0%
8th FP

9th FP

6th FP

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP

13th FP

37.9%
52.8%

52.8%

47.3%

47.4%

49.0%

49.1%

47.2%

47.2%

52.7%

52.6%

51.0%

50.9%

40%

62.1%

7th FP

5th FP

100.0%

ShortTerm

6th FP

4th FP

100%

7.1%

80%

40%

3rd FP

Ratio
Ratio ofof Loans
Loans with
with Fixed
Fixed Interest
Interest Rates
Rates

Ratio
Ratio ofof Long-Term
Long-Term Loans
Loans
100%

10%

10th FP

11th FP

12th FP

13th FP

62.1%

20%

Floating
Fixed

0%

6th FP

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP

13th FP•Regarding all graphs on this page, figures for the end of the 9th FP and after include ¥8.5 bn of investment corporation bonds.

20

IV - 2. Financial Strategies: Financial Status / Extending Borrowing Periods
Refinancing
Refinancing Status
Status andand Extending
Extending Borrowing
Borrowing Periods
Periods

Remaining Period of Interest-bearing Liabilities
2 years & 7 months
12ｔｈ FP（as of Apr. 30, 2012）(avg.)
3years
13th FP （as of Oct. 31, 2012）(avg.)
3 years & 2 months
14th FP after refinancing（as of Nov. 30, 2012）(avg.)

Refinance for 13th Fiscal Period●Jun. 2012: Total ¥17.50bn in long-term loans⇒ ￥8.5bn Refinanced with long-term loans (fixed rate)￥9bn Refinanced with long-term loans (floating rate)●Nov. 2012:Total ¥9.8bn in long-term loans⇒ ￥7bn Refinanced with long-term loans (floating rate)￥2.8bn Refinanced with short-term loans (floating rate)(million yen)

*Scheduled repayment of 67.5 million yen each period between 13th FP and 21th FP

25,00020,0006,700

15,0009,000
10,0007,000

No. 1 Unsecured
Investment
Corporation Bonds

2,800

8,500

9,800

Short-Term

8,500

6,300
4,000

-

13th FP

Outstanding Balanceof Loans by Lender

Outstanding Balance of InterestBearing Liabilities as of th FP
13

14th FP

17,50016,700

3,000
5,000

19,04015th FP

16th FP

17th FP

3,000
18th FP

19th FP

20th FP

21th FP

1,823
22th FPLong-Term
Long-Term
23th FP

Sumitomo Mitsui Trust Bank, Limited.

¥27,887mn

31.5％

Dai-Ichi Life Insurance Company Ltd.

¥1,000mn

1.1％Mizuho Corporate Bank, Ltd.

¥16,590mn

18. ％Resona Bank, Limited¥1,000mn

1.1％

Sumitomo Mitsui Banking Corporation¥13,074mn

14.8％

The Bank of Fukuoka,Ltd.

¥3,000mn

3.4％

The Bank of Tokyo Mitsubishi UFJ, Ltd.

¥13,074mn

8

14. ％

The Hiroshima Bank, Ltd.

¥1,000mn

1.1％

Mitsubishi UFJ Trust and Banking
Corporation¥4,415mn

5.0％

The Yamaguchi Bank, Ltd.

¥1,000mn

1.1％Development Bank of Japan, Inc.

¥6,362mn

7.2％¥88, 402mn

100.0％¥8,500mn－¥96,902mn－

8

Subtotal
No 1 Unsecured Investment Corporation Bonds
Total

21

IV - 3． Financial Strategies: Issuer Rating and Loans at End of Thirteenth Fiscal Period
IssuerRating

Baa１ (Negative)

Assigned by Moody’s Japan K.K.

A＋

Assigned by Rating and Investment Information, Inc. (R&I)（Stable）(※)The Issuer Rating was downgraded to A+ from AA－ with a Stable outlook on Ｏｃｔ 10, 2012.
LenderCategory

Development Bank of Japan, Inc

Loan
Balance¥135mnInterest Rate(end of Oct.
2012)

January
13, 2010

Repayment
Date

November30, 2016

Remaining
PeriodNote

Scheduled
repayment

Unsecured
and without
guarantee

Sumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation¥135mnSumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation
Resona Bank, Limited¥9,800mn

1.23％（floating）

January
13, 2010

November30, 2012

1 months

Unsecured
and without
guarantee¥9,800mn¥6,300mn

Development Bank of Japan, Inc¥3,000mn

1.48％（fixed）

March
27, 2008

March
27, 2013

5 months

Unsecured
and without
guarantee

1.53％（fixed）¥9,300mn¥19,235mn

Sumitomo Mitsui Trust Bank, Limited.

¥2,000mn

Development Bank of Japan, Inc¥1,000mn

Dai-Ichi Life Insurance Company Ltd.

¥1,000mn

Long-Term Loans

1.37％
（avg）
2.27％
（fixed）
2.40％（fixed）
2.40％（fixed）

June
29, 2007

June
30, 2014

1 years &8 months

Unsecured
and without
guarantee¥4,000mn
Sumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation¥16,700mn

March
3, 2011February29, 2016

3 years &4 months

Unsecured
and without
guarantee¥16,700mn
Sumitomo Mitsui Trust Bank, Limited.
The Bank of Fukuoka, Ltd.
The Hiroshima Bank, Ltd.
The Yamaguchi Bank, Ltd.

¥6,700mn¥6,700mn

Sumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation

0.83％（floating）

March
31, 2011

February29, 2016

3 years &4 months

Loan
Execution
Date

Repayment
Date

Remaining
Period¥3,000mn

0.66％（floating）

March
30, 2012

October
31, 2016

4 years

2.42％（fixed）

January
13, 2010

November30, 2016

3 years &9 months

0.56％
November（floating） 30, 2011

November30, 2016

4 years &1 months

June
30, 2017

4 years &8 months

Note

Unsecured
and without
guarantee¥2,227mn

Unsecured
and without
guarantee¥19,040mn

Unsecured
and without
guarantee¥19,040mn¥9,000mn¥8,500mn

0.66％（floating）
0.79％（fixed）

June
29, 2012

Unsecured
and without
guarantee¥17,500mn¥69,167mn

1.00％
（avg）

¥88,402mn

1.08％
（avg）

No 1 Unsecured Investment
Corporation Bonds¥8,500mn

1.00％（fixed）

Total Interest bearing liabilities¥96,902mn

1.07％
（avg）

Subtotal
Total Loans

1.39％（fixed）

Interest Rate(end of Oct.
2012)

¥2,227mn

Sumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation

3 months（avg）

Loan Balance¥3,000mn

Development Bank of Japan, Inc.

Sumitomo Mitsui Trust Bank, Limited.
Mizuho Corporate Bank, Ltd.
Sumitomo Mitsui Banking Corporation
The Bank of Tokyo Mitsubishi UFJ, Ltd.
Mitsubishi UFJ Trust and Banking Corporation

Subtotal

LenderCategory

Long-Term Loans

Current Portion of Long-Term Loans

2.42％（fixed）

Loan
ExecutionDate

3 years &10 months（avg）
3 years &1 months（avg）
June 4,2010

June 4,2015

2 years &7 monthUnsecured
and without
guarantee

3 years（avg）

Unsecured
and without
guarantee

Note : Interest rates are rounded to the second decimal place, and the remaining periods are rounded toa whole number. The averages for interest rates and remaining periods are weighted averages
based on the balance at the end of fiscal period.

22

V． Management Results at the Thirteenth fiscal Period23

V - 1. Operating Results: History of Asset Growth
History
History ofof Asset
Asset Growth
GrowthAcquisition price

Latent profit = (Appraisal value – Book value)

Appraisal value(billion yen)(billion yen)

200

30
25

180
20
15

160

10
140

5
0

120
-5
100

-10
1st FP

2nd FP

3rd FP

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP

13th FPEnd of 1st
FP
Oct. 2006

End of 2nd
FP
Apri. 2007

End of 3rd
FP
Octl. 2007

End of 4th
FP
April. 2008

End of 5th
FP
Oct. 2008

End of 6thFP
April. 2009

End of 7th
FP
Oct. 2009

End of 8thFP
April. 2010

End of 9th
FP
Oct. 2010

End of 10thFP
April. 2011

End of 11th
FP
Oct. 2011

End of 12thFP
April. 2012

End of 13th
FP
Oct. 2012

Acquisition
price¥113.286bn¥130.846bn¥130.846bn¥157.187bn¥162.347bn¥162.347bn¥162.347bn¥175.047bn¥175.047bn¥175.047bn¥177.435bn¥184.345bn¥184.345
bn

Book value¥116.187bn¥133.576bn¥132.698bn¥159.585bn¥163.985bn¥163.245bn¥162.237bn¥174.618bn¥173.618bn¥172.994bn¥174.742bn¥181.405bn¥180.446bn

Appraisalvalue¥127.442bn¥152.468bn¥155.923bn¥188.035bn¥189.441bn¥170.870bn¥164.948bn¥177.146bn¥175.351bn¥170.670bn¥172.440bn¥179.000bn¥173.800bn

Unrealized
profits andloses¥11.254bn¥18.891bn¥23.224bn¥28.449bn¥25.455bn¥7.624bn¥2.710bn¥2.527bn¥1.732bn(¥2.324bn)(¥2.302bn)(¥2.405bn)(¥6.646bn)*Acquisition price and appraisal value details are provided on P25 to P26.
*Figures less than one million yen have been rounded down for the above-mentioned values. As for latent profits and loses, figures less than one million yen have been rounded down
after deducting book value (total) from appraisal value (total).

24

V - 2. Appraisal Value as at End of Period(million yen)
Asset
Class

Acquisition
Price

Book Value at
End of 13th FP(A)

Appraisal Valueat End of 10thFP
(Note)

Appraisal Valueat End of 11th
FP
(Note)

Appraisal Valueat End of 12thFP
(B)

Appraisal Valueat End of 13th
FP (Ｃ）

NEC Head Office Building

41,95042,79447,95047,50049,45049,450

6,655-

Harumi Island Triton Square
Office Tower Y

33,00030,76938,70038,50036,40032,1001,330(4,300)

Harumi Island Triton Square
Office Tower Z

20,00019,69014,30014,20014,30014,300(5,390)-Kanda Nishiki-cho 3-chome
Building

12,70012,75514,00014,00014,10014,100

1,344-

Akasaka Oji Building

9,660

9,807

9,570

9,560

9,080

7,990

(1,817)(1,090)

Shiba-Koen Building

5,770

5,870

3,410

3,410

3,420

3,420

(2,450)-Shinkawa Chuo Building

5,610

5,817

-

-

5,790

5,790

(27)

-

Kanda Park Plaza

5,156

5,084

4,970

4,930

4,930

4,900

(184)

(30)

Tokyo
Faret East Building
Metropolitan Area

2,091

1,678

2,430

2,390

2,390

2,390

711

-

Subtotal (9 properties)

135,937

134,268

135,330

134,490

139,860

134,440

171(5,420)

Sagamihara Shopping Center

12,00011,36010,30010,30010,40010,400

(960)

-

Tokyo
Ito-Yokado Higashi-Narashino
Metropolitan Area Store

8,900

7,926

5,560

5,560

5,620

5,610

(2,316)

(10)

Area

CentralTokyo
OfficeRetailOther

PropertyMusashiurawa Shopping Center

4,335

3,951

3,810

3,810

3,860

3,860

(91)

-

Subtotal (3 properties)

25,23523,23819,67019,67019,88019,870(3,368)(10)Top Residence
Nihonbashi Kayabacho

2,400

2,459

-

-

2,550

2,580

120

30

Fukasawa House Towers H&I

10,635

10,242

6,990

6,960

6,950

7,060

(3,182)110

Ecology Toyosu Procentury
Tokyo
Metropolitan Area Impress Musashi-Koganei

5,160

5,030

4,590

4,780

4,880

4,970

(60)

90

1,223

1,289

-

1,270

1,280

1,270

(19)

(10)

Top Residence Yoga

1,165

1,233

-

1,170

1,150

1,160

(73)

10

Subtotal (5 properties)

20,583

20,254

11,58014,18016,81017,040(3,214)230

OAK PLAZA

2,590

2,684

2,660

2,670

2,450

2,450

(234)

-

CentralTokyo
Residential

Difference
Difference in
BetweenAppraisal Value
Appraisal Value from End of 12thFP
and Book Value(C) – (B)（C）－（A）

CentralTokyo

Subtotal （1 property）
Total (18 properties)

2,590

2,684

2,660

2,670

2,450

2,450

(234)

-

184,345

180,446

169,240

171,010179,000

173,800(6,646)(5,200)(Note) In the described above table, the respective appraisal value of ended period from 10th to 11th excluded the Nittetsu Honmachi Building disposed on November 25, 2011.

25

V - 3. Appraisal Cap Rate
Property

9th Fiscal Period

10th Fiscal Period

11th Fiscal Period

12th Fiscal Period

13th Fiscal Period

Discounted Cash Flow
DirectCapitaliz Method
ation
Terminal
Method: Discount
Cap Rate
Cap Rate Rate

Discounted Cash Flow
DirectCapitaliz Method
ation
Terminal
Method: Discount
Cap Rate
Cap Rate Rate

Discounted Cash Flow
DirectCapitaliz Method
ation
Terminal
Method: Discount
Cap Rate
Cap Rate Rate

Discounted Cash Flow
DirectCapitaliz Method
ation
Terminal
Method: Discount
Cap Rate
Cap Rate Rate

Discounted Cash Flow
DirectCapitaliz Method
ation
Terminal
Method: Discount
Cap Rate
Cap Rate Rate

NEC Head Office Building

4.3%

3.8%

3.8%

3.8%

(Next 3 years)(Next 2 years)(Next 2 years)

4.3%(afterward)

4.6%

4.3%

4.3%
(afterward)

4.6%

4.3%

4.3%
(afterward)

4.6%

4.2%

3.7%

3.7%

(Next 1years)(Next 1years)

3.9%(2-5years)

4.5%

4.2%

4.2%

4.5%

4.2%

(afterward)

Harumi Island Triton Square
Office Tower Y
Harumi Island Triton Square
Office Tower Z
Kanda Nishiki-cho 3-chome
Building

3.9%(2-5years)(afterward)

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.8%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

4.6%

4.3%

4.8%

5.2%

4.9%

5.4%

4.9%

4.6%

5.1%

4.9%

4.6%

5.1%

4.9%

4.6%

5.1%

4.9%

4.6%

5.1%

Akasaka Oji Building

4.5%

4.5%

4.8%

4.5%

4.5%

4.8%

4.5%

4.5%

4.8%

4.5%

4.4%

4.7%

4.5%

4.4%

4.7%

Shiba-Koen Building

5.0%

4.8%

5.1%

4.9%

4.7%

5.0%

4.9%

4.7%

5.0%

4.8%

4.6%

5.0%

4.8%

4.6%

5.0%

-

-

-

-

-

-

-

-

-

4.9%

4.7%

5.1%

4.9%

4.7%

5.1%

Kanda Park Plaza

5.3%

4.8%

5.9%

5.3%

4.8%

5.6%

5.2%

4.7%

5.5%

5.2%

4.7%

5.5%

5.2%

4.7%

5.5%

Faret East Building

5.8%

5.5%

6.0%

5.8%

5.5%

6.0%

5.7%

5.4%

5.9%

5.7%

5.4%

5.9%

5.7%

5.4%

5.9%

6.0%

5.8%

6.1%

6.0%

5.8%

6.1%

6.0%

5.8%

6.1%

5.9%

5.7%

6.1%

5.9%

5.7%

6.1%

6.4%

5.5%

6.9%

6.3%

6.1%

6.6%

6.3%

6.1%

6.6%

6.3%

6.1%

6.6%

6.3%

6.1%

6.6%

5.8%

5.5%

6.1%

5.8%

5.5%

6.1%

5.8%

5.5%

6.1%

5.7%

5.4%

6.0%

5.7%

5.4%

6.0%

-

-

-

-

-

-

-

-

-

5.1%

4.9%

5.3%

5.0%

4.8%

5.2%

5.2%

4.9%

5.4%

5.1%

4.8%

5.3%

5.0%

4.7%

5.2%

5.0%

4.7%

5.2%

4.9%

4.6%

5.1%

Ecology Toyosu Procentury

5.5%

5.3%

5.7%

5.4%

5.2%

5.6%

5.2%

5.0%

5.4%

5.2%

5.0%

5.4%

5.1%

4.9%

5.3%

Impress Musashi-Koganei

-

-

-

-

-

-

5.5%

5.3%

5.7%

5.5%

5.3%

5.7%

5.5%

5.3%

5.7%

Top Residence Yoga

-

-

-

-

-

-

5.0%

4.8%

5.2%

5.0%

4.8%

5.2%

5.0%

4.8%

5.2%

4.8%

4.3%

5.4%

5.2%

5.0%

5.5%

5.2%

5.0%

5.5%

5.1%

4.9%

5.4%

5.1%

4.9%

5.4%

Shinkawa Chuo Building

Sagamihara Shopping
Center
Ito-Yokado HigashiNarashino Store
Musashiurawa Shopping
SquareTop Residence
Nihonbashi Kayabacho
Fukasawa House Towers
H&I

OAK PLAZA
Appraisers

Properties

Tanizawa Sogo Appraisal Co., Ltd.

NEC Head Office Building, Akasaka Oji Building

Japan Real Estate institute

Harumi Island Triton Square Office Towers Y & Z, Kanda Nishiki-cho 3-chome Building, Kanda Park Plaza, Faret East Building, Ito-Yokado
Higashi-Narashino Store, Top Residence Nihonbashi kayabacho, Fukasawa House Towers H&I, Ecology Toyosu Procentury,
Impress Musashi-Koganei, Top Residence Yoga ,OAK PLAZADAIWA REAL ESTATE APPRAISAL Corporation

Shiba-Koen Building, Shinkawa chuo Building, Sagamihara Shopping Center, Musashiurawa Shopping Square• The appraisals were conducted by the above real estate appraisers based on the asset assessment methods and standards specified in TOP REIT’s
articles of incorporation as well as the regulations set forth by The Investment Trust Association, Japan.

26

V - 4. Operating Results: History of Occupancy Rate
Occupancy
Occupancy Rate
Rate (Portfolio)(Portfolio)
Gross rentable floor space(gross rentablefloor space: ㎡)

Occupancy rate

(Ｏｃｃｕｐａｎｃｙ ｒａｔｅ)

99.8% 99.9% 99.5% 99.7% 99.5% 99.5% 99.2% 99.2% 99.2% 99.5% 99.7%

97.3%

98.5% 99.2% 99.0% 99.0% 99.0% 98.9% 99.2% 99.2%

325,000

100%
95%

276,833

275,000

283,622 283,622 283,622

291,648 291,628 291,628

295,215300,294 300,294 300,294 300,294 300,294 300,294 300,294 300,294

90%

261,672 261,672

85%
80%

229,232
225,00075%
178,10470%

175,000

65%
60%

125,000
Apr. 2012 May.2012
Apr. 2011
Oct. 2011
Apr.2010
Oct.2010
Oct.2009
Oct.2008
Apr.2009
Apr.2008
Oct.2006
Apr.2007
Oct.2007
March 2006
End of 1st FP End of 2nd FP End of 3rd FP End of 4th FP End of 5th FP End of 6th FP End of 7th FPEnd of 8th FP End of 9th FP End of 10th FPEnd of 11th FPEnd of 12th FP(IPO)

Jun. 2012

Jul. 2012

Aug. 2012

Sep. 2012

Oct. 2012
End of 13th FP

Nov. 2012

99.0%

99.0%

Occupancy
Occupancy Rate
Rate (Office)(Office)
Rentable office space(rentable floor
space: ㎡)

Occupancy rate
(Ｏｃｃｕｐａｎｃｙ ｒａｔｅ)

99.7%

99.8% 100.0% 100.0% 100.0% 99.6% 99.0%

99.1%

99.4% 99.6%

99.8%

180,000

99.1% 98.8%

98.8%

98.8% 98.3%

95.0%

150,000
131,532 130,968 130,249 130,409

120,000

98.0%

116,015

138,674 138,930 139,313

132,601

138,298 139,916 139,452 139,452 139,452 138,843 139,794 139,794

100%

90%

116,090 116,370 116,370

80%
90,00070%
60,00060%

30,0000

Apr. 2012 May.2012
Apr. 2011
Oct. 2011
Apr.2010
Oct.2010
Oct.2009
Oct.2008
Apr.2009
Apr.2008
Oct.2006
Apr.2007
Oct.2007
March 2006
End of 1st FP End of 2nd FP End of 3rd FP End of 4th FP End of 5th FP End of 6th FP End of 7th FPEnd of 8th FP End of 9th FP End of 10th FPEnd of 11th FPEnd of 12th FP(IPO)

Jun. 2012

Jul. 2012

Aug. 2012

Sep. 2012

Oct. 2012
End of 13th FP

Nov. 201250%

27

V - 4. Operating Results: History of Occupancy Rate
Occupancy
Occupancy Rate
Rate (Total(Total ofof Residence)
Residence)(rentable floor
space: ㎡)

Rentable office space

Occupancy rate (Total)(Ｏｃｃｕｐａｎｃｙ ｒａｔｅ)100%

30,000
94.6%

93.6%

93.9%

95.7%

95.1%

95.0%

92.7%
89.5%

95.5%

94.9%

95.1%

2 3,89 924 ,03 2

2 3 ,8 93

23 ,94 5

93.8%

93.3%

25,00094.9%

2 3,60 5

96.5%

96.4%

96.3%

2 4,2 80

24 ,2 74

2 4 ,2 47

90%

88.7%
2 0,62 0

20,000
17 ,1 75

1 7,0 34

1 6,9 83

1 6,8 22

1 7,26 2

17 ,3 7 480%

15,00010,0001 0 ,1 64

10 ,63 370%
10 ,06 9

60%

5,000

0
Oct.2007
Apr.2008
Apr.2007
Oct.2008
End of 2nd FP End of 3rd FP End of 4th FP End of 5th FP

Apr.2010
Oct.2009
Apr.2009
End of 6th FP End of 7th FP End of 8th FP

Apr. 2012
Oct.2010
Apr. 2011
Oct. 2011
End of 9th FP End of 10th FP End of 11th FP End of 12th FP

May.2012

Jun. 2012

Jul. 2012

Aug. 2012

Sep. 201250%

Oct. 2012
End of 13th FP

Nov. 2012

97.8%

97.8%

Occupancy
Occupancy Rate
Rate (Each(Each ofof Residence)
Residence)(Ｏｃｃｕｐａｎｃｙ ｒａｔｅ)

Fukasawa

ToyosuMusashi-Koganei

Yoga

Nihonbashi kayabacho

100.0%
97.7%

97.5%

97.4%

97.7%

97.9%

97.6%
96.8%

96.6%
95.6%
94.6%
93.6%

90.7%

97.8%

96.8%

97.2%

97.0%
96.0%
95.9%
95.1%
95.5%
95.5%
94.3%
94.3%
94.0% 94.3%
94.8%
94.2%
94.3%
93.5%
92.7%
91.7%

96.9%

96.3%

94.3%

94.4%

92.0%

93.0%

95.7%
93.4%
92.7%

91.8%

95.9%
93.7%

91.0%

91.0%

90.0%

89.6%

89.5%
88.7%

85.0%

94.5%

93.6%
92.2%

96.9%

95.7%

95.0%
93.0%

96.8%

Oct.2007
Apr.2008
Apr.2007
Oct.2008
End of 2nd FP End of 3rd FP End of 4th FP End of 5th FP

89.2%

Apr. 2012
Apr.2010
Oct.2010
Oct.2009
Apr. 2011
Oct. 2011
Apr.2009
End of 6th FP End of 7th FP End of 8th FP End of 9th FP End of 10th FP End of 11th FP End of 12th FP

89.2%

May.2012

Jun. 2012

Jul. 2012

Aug. 2012

Sep. 2012

Oct. 2012
End of 13th FP

Nov. 201228

V - 5. Operating Results: Rent Revisions (excluding residential)
Monthly rent before
revision

Revised monthly
rent

Rent revision results ＝Increase in monthly rent(%)

Monthly rent before revision（million yen）

300

△13.8％△13.8％
250

＋0.5％
＋0.5％

＋0.1％
＋0.1％

200

150

△11.4％△11.4％
△5.8％
△5.8％

100

＋14.9％＋14.9％
＋0.2％
＋0.2％

＋7.8％
＋7.8％

50

0

1st FP

2nd FP

3rd FP

△6.5％
△6.5％

△1.4％
△1.4％

＋9.1％
＋9.1％

4th FP

5th FP

6th FP

7th FP

8th FP

9th FP

△0.9％
△0.9％

△9.0％
△9.0％

10th FP

11th FP

12th FP

13th FP

3th FP◆
Results ofof 113th
FP Rent
Rent Revision
Revision ◆◆◆ Results
Minimized ranges of rent reduction
・ Office Buildings

8 cases ： Unchanged：6 ・ Decreased：2■ Total (excluding residential) ： 0.9％ decrease on average

29VI. Thirteenth Fiscal Period Results (Ended October 31, 2012)30

VI - 1. Statements of Income (Summary) /Statements of Cash Distributions■ Statements of Income
Account■ Statements of Cash Distributions

12th FP
November 1, 2011 April 30, 2012(182 days)

13th FPMay 1, 2012 October 31, 2012(184 days)

AmountAmountAccount

I. Operating revenue andexpenses

12th FP
November 1, 2011 April 30, 2012(182 days)

13th FPMay 1, 2012 October 31, 2012(184 days)

AmountAmountUnappropriatedretained earnings¥1,999mn¥2,001mn

1.Operating revenue¥5,693mn¥5,636mn

Total dividend amount¥1,949mn¥2,001mn

2.Operating expenses¥2,921mn¥2,939mn<Dividend per unit><¥12,577><¥12,912>

Expenses related torent business¥2,383mn¥2,384mn

Voluntary retained earnings

¥49mn

-

¥409mn¥430mnRetained earnings
carried forward

¥0mn

¥0mn

Asset management fees
Other
Operating income¥129mn¥124mn¥2,772mn¥2,697mn

II. Non-operating income
and expenses【Expenses related to rent business】

1.Non-operating income

¥4mn

¥3mn

 Depreciation and amortization:¥ 1,116 mn

Interest income

¥2mn

¥1mn

 Property management expenses:¥ 392 mn

Other

¥1mn

¥1mn

 Utilities expenses:¥ 230 mn

2.Non-operating expenses¥747mn¥697mnInterest expenses¥553mn¥503mnInterest expenses oninvestment corporation bonds

¥42mn

¥42mn

¥151mn¥151mn¥2,029mn¥2,002mn

Other
Ordinary income
Extraordinary loss--

¥2,029mn¥2,002mn

Income taxes-current

¥0mn

¥0mn

Income taxes-deferred¥28mn(¥0mn)Net income¥1,999mn¥2,001mn

Unappropriatedretained earnings¥1,999mn¥2,001mn

Income before income taxes

and others31VI - 2. Balance Sheets (Summary)
Account

12th FP(as of April 30, 2012)

13th FP(as of October 31, 2012)

AmountAmountAccount

12th FP(as of April 30, 2012)

13th FP(as of October 31, 2012)

AmountAmountLiabilities
Assets
I. Total current assets¥6,235mn¥7,144mn

Cash and deposits¥1,669mn¥2,306mn

Cash and deposits in trust¥4,299mn¥4,538mn¥266mn¥299mn¥182,137mn¥181,266mn

Other
II. Total noncurrent assets
1. Total property, plant andequipment
Buildings, etc.

I. Total current liabilities
Operating accounts payable¥38,225mn¥225mn¥20,794mn¥80mn

Short-term loans payable
Current portion of long-termloans payable
Accounts payable － other--¥36,735mn¥19,235mn¥233mn¥252mn¥221mn¥174mn-¥102mnAdvances received¥804mn¥945mnDerivative liabilities

-

-

¥4mn

¥3mn

¥65,922mn¥83,341mn

Accrued expenses
Accrued consumption taxes¥181,403mn¥994mn¥180,444mn¥982mn

Other

Land

¥4,888mn¥4,888mn

Buildings, etc. in trust¥50,842mn¥49,878mn

Investment Corporation Bond

¥8,500mn¥8,500mn

Land in trust¥124,678mn¥124,695mn¥51,735mn¥69,167mn

2. Total intangible assets

¥2mn

¥1mn

¥144mn¥125mnIntangible assets

¥2mn

¥1mn

¥5,513mn¥5,512mn¥731mn¥820mnLong-term loans payable
Tenant leasehold and security
deposits
Tenant leasehold and security
deposits in trust
Deferred tax liabilities

¥28mn

¥25mn

¥10mn

Derivative liabilities

-

¥10mn

Other noncurrent liabilities--¥104,147mn¥104,136mn

I. Total unitholders’ equity¥84,259mn¥84,311mn

1.Unitholders’ capital¥82,260mn¥82,260mn

2.Surplus¥1,999mn¥2,051mn-¥49mn¥1,999mn¥2,001mn-(¥6mn)

3. Total investment andother assets
Lease and guarantee deposits¥10mnLong-term prepaid expenses¥537mn¥613mnOther¥184mn¥197mn

¥34mn

¥29mn

III. Total deferred assets
Investment corporation bondissuance costs
Total assets¥34mn¥188,407mn¥29mn¥188,440mn

II. Total noncurrent liabilities

Total liabilities
Net assets

Reserve for reduction entry
Unappropriatedretained earnings
II. Total valuation and translation
adjustments
Deferred gains or losses on hedge-(¥6mn)

Total net assets¥84,259mn¥84,304mn

Total liabilities and net assets¥188,407mn¥188,440mn

32VI - 3. Major Financial Indicators
11th Fiscal Period
May 1, 2011 –October 31, 2011

12th Fiscal Period
November 1, 2011 –April 30, 2012

13th Fiscal Period
May 1, 2012 –October 31, 2012

184days

182days184days

50.7%

51.5%

51.4%

¥4,393mn¥4,126mn¥4,368mn-[¥4,382mn]

-

5.0%

4.5%

4.7%

included capital gains-[4.8%]-

Funds from Operation (FFO)¥3,046mn¥2,815mn¥3,117mn¥19,654¥18,165¥20,113

1.1%

1.1%

1.1%

[2.1%][2.2%][2.1%]

2.4%

2.4%

2.4%

[4.7%][4.8%][4.7%]

Item
Period of asset management
Ratio of interest-bearing liabilities tototal assets at end of period (LTV)
Rental NOI(Net operating income)included capital gains
Rental NOI yield

FFO per unit
Ratio of ordinary income to total
assets (return on assets (ROA))
Annualized
Ratio of net income to unitholders'equity (return on equity (ROE))
Annualized

RemarkInterest-bearing liabilities at end of period / Total assets at end of
periodRent revenue – Expenses related to rent business + Depreciation
and amortization
Rental NOI x 2 / Sum total of the acquisition price of all properties
in the portfolio at end of period
Net income + Depreciation and amortization
FFO / Number of units issued and outstanding at end of period
Ordinary income / ((Total assets at beginning of period + Total
assets at end of period) / 2)
(Note) The figure of 12th FP was included capital gains disposedon November 25, 2011
Net income / ((Net assets at beginning of period + Net assets at
end of period) / 2)
(Note) The figure of 12th FP was included capital gains disposedon November 25, 2011

Implied Cap Rate

5.7%

5.1%

5.6%

NOI / ( Market capitalization at end of period +Net Debt at end of
period (Total liabilities at end of period – Total current assets at
end of period))(Note) The figure of 12th FP was included capital gains disposedon November 25, 2011

NAV multiple

0.76

0.85

0.74

Market capitalization at end of period / (Net assets at end of
period + (Appraisal value at end of period – Book value at end of
period))Ratio of unitholders' equity to total
assets at the end of period

45.4%

44.7%

44.7%

Net assets at end of period / Total assets at end of period

33

VI - 4 . Unitholders
Unitholdings
Unitholdings (as(as atat endend ofof 13th
13th FP)FP)
Category

Number of Units Held

Individuals / other
Financial institutions(incl. securities firms)
Other domestic
corporations
Overseas corporations /individuals
Total

NumberNumber ofof Unitholders
Unitholders
Number of Unitholders

24,392

15.7%

7,455

95.3%

94,436

60.9%

106

1.4%

13,572

8.8%

154

2.0%

22,600

14.6%

108

1.4%

155,000

100.0%

7,823

100.0%

Top
Top 1515 Unitholders
Unitholders (as(as atat endend ofof 13th
13th FP)
FP)
Rank

Name

Number of
Share of Total
Units Held

1 Japan Trustee Service Bank (trust account)

28,65818.5

2 Nomura Trust and Banking (investment trust account)

8,155

5.3

Trust and Custody Services Bank (securities investment
3 trust account)

6,402

4.1

4 North Pacific Bank, LTD.

6,139

4.0

5 The Master Trust Bank of Japan (trust account)

4,829

3.1

6 The Senshu Ikeda Bank, Ltd

4,540

2.9

THE BANK OF NEW YORK.NON-TREATY JASDEC
7 ACCOUNT

3,848

2.5

8 MetLife Alico Life Insurance K.K GA Company JPY

3,757

2.4

9 Sumitomo Mitsui Trust Bank, Limited

3,176

2.0

10 Oji Real Estate Co., Ltd.
10 NIPPON STEEL KOWA REAL ESTATE CO.,LTD.

3,162
3,162

2.0
2.0

12 NOMURA BANK (LUXEMBOURG) S.A.

2,464

1.6

13 Trust and Custody Services Bank (money trust tax
account)
The Gibraltar Life insurance Co., Ltd (general accounts
14
J-REIT account)

2,389

1.5

1,750

1.1

15 The Minami Nippon Bank, Ltd.

1,550

1.0

83,981

54.2

Total

11th Fiscal Period
Total number ofunitholders at endof period: 7,031

Financial institutions (incl. securities firms):
Other domestic corporations:
Overseas corporations / individuals:
Individuals / other 6,675[94.9%]
Financial institutions (incl. securities firms):
Other domestic corporations:
Overseas corporations / individuals:

12th Fiscal Period
Total number ofunitholders at endof period: 6,912

111 [1.6%]
140 [2.0%]
105 [1.5%]

99 [1.4%]
140 [2.0%]
90 [1.3%]

Individuals / other 6,583 [95.2%]
Financial institutions (incl. securities firms):
Other domestic corporations:
Overseas corporations / individuals:

13th Fiscal Period
Total number ofunitholders at endof period:7,823

106[1.4%]
154[2.0%]108[1.4%]

Individuals / other 7,455[95.3%]

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

NumberNumber ofof Units
Units Held
Held
Other domestic corporations:
13,120 [8.5%]

Individuals / other:
20,516 [13.2%]
11th Fiscal Period
Total number of units
issued andoutstanding at end of
period: 155,000

Individuals / other:
21,159 [13.7%]

12th Fiscal Period
Total number of units
issued andoutstanding at end of
period: 155,000

Other domestic corporations:
13,264 [8.6%]

Overseas
corporations /individuals:
19,218 [12.4%]

Financial institutions (incl. securities firms):
101,359 [65.4%]
Other domestic corporations:
13,572 [8.8%]

Individuals / other:
24,392 [15.7%]

13th Fiscal Period
Total number of units
issued andoutstanding at end of
period: 155,000

Overseas
corporations /individuals:
20,427 [13.2%]

Financial institutions (incl. securities firms):
100,937 [65.1%]

Overseas
corporations /individuals:
22,600 [14.6%]

Financial institutions (incl. securities firms):
94,436 [60.9%]

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

34

VI - 5. Unit Price Performance and Volume （Mar 1, 2006 – November 30, 2012）
第10期
Top REIT Trading Volume
TOP出来高
TOP

第10期
(yen)
（円）

Top REIT
東証REIT指数（指数化後）

TOPIX

TSE
REIT Index
TOPIX（指数化後）

第10期
（口）

1,000,000(Unit)
10,00013th FP

14th FP

900,000
8,000
800,000

700,000

6,000

600,000

4,000

500,000

400,000
2,000
300,000

200,000

Apr
2006

Oct
2006

Apr
2007

Oct
2007

13th
13th Fiscal
Fiscal Period
Period End
End
Unit
Unit PricePrice(based(based on
on closing
closing price)
price)

Apr
2008

Oct
2008

Apr
2009

Oct
2009

Apr
2010

IPO
IPO PricePrice¥371,000(Oct. 31, 2012)

Historical
Historical HighHigh since
since IPO
IPO
(basedon
closing
price)(based on closing price)
Historical
Historical Low
Low since
since IPO
IPO
(basedon
closing
price)(based on closing price)

Oct
2010

Apr
2011

¥550,000

Oct
2011

Apr
2012

Oct
2012

0

Mar. 1, 2006

¥998,000 Feb. 16, 2007
¥208,000 Oct. 28, 200835

VII． Appendix: Portfolio Overview

36VII - 1. Portfolio Map (as at end of 13th FP)
Tokyo Metropolitan Area

Musashiurawa
Shopping
SquareImpress
MusashiMusashi-Koganei Fukasawa House
Towers H&I
Faret East Building
ItoIto-Yokado
HigashiHigashi-Narashino
Top Residence
Store
Yoga

NEC Head Office Building

Musashiurawa
Shopping
SquareFukasawa House Towers H&I
Harumi Island Triton Square
Office Tower Y&Z
Sagamihara Shopping Center

Iidabashi Sta.OAK PLAZA
Kanda Nishiki-cho
3-chome Building

Central Tokyo

Shinjuku Sta.
Yotsuya Sta.

Shibuya
Ward

Akihabara Sta.
Kanda Park Plaza
Kanda Sta.

ChiyodaTop Residence
Ward Tokyo Sta. Nihonbashi Kayabacho
Shinkawa Chuo Building

Akasaka Oji
Building
MinatoWard
Shibuya Sta.

Chuo Ward
Shinbashi Sta.

ShibaShiba-Koen
Building
NEC Head
Office Building

Ecology Toyosu
Procentury
Harumi Island
Triton Square
Office Tower Y & Z
Kanda Nishiki-cho 3-chome Building

Shinagawa
Ward
Shinagawa Sta.

37

VII - 2. Portfolio Summary (as at end of 13th FP)
Total Acquisition Price: ¥184.345bn.

Gross Rentable Floor Area : 300,294.23m2

Number of Properties

:

PML

18

:

Asset Class (property type)
100%
11.5%

18.4%

80%

Area

2.0%
8.1%

1.6%
9.7%

1.6%
9.7%

1.5%
9.0%

1.5%
10.2%

1.4%
11.2%

19.3%

15.5%

15.5%

14.4%

14.2%

13.7%

Other

20%

100%

Residential

1.1%
13.0%

RetailOffice

1.0%

88.5%

81.6%
70.6%

73.1%

73.1%

75.1%

74.1%

73.7%

(40.2%)(37.0%)(32.1%)(25.8%)(25.8%)(24.0%)(23.6%)(22.8%)IPO

End of
1st FP

End of
3rd FP

End of
5th FP

End of
7th FP

End of
9th FP

End of11th FPEnd of13th FP

0.6%

28.6%

26.6%

26.6%

24.6%

25.6%

24.7%

70.6%

72.8%

72.8%

74.7%

73.7%

75.3%

End of
3rd FP

End of
5th FP

End of
7th FP

End of
9th FP

End of11th FPEnd of13th FP

Other( ) Share of
NEC Head Office
Building

86.0%

79.2%

Tokyo
Metropolitan
Area
Central
Tokyo

20%

0%

6.0%
10.7%

5.5%

6.8%

IPO

End of
1st FP

12.2%

11.3%

12.5%

15.8%

Less than
10,000㎡

21.9%

21.9%

27.6%

27.2%

26.2%

10,000㎡49,999㎡

100%

26.8%
9.2%

60%

4.6%

5.9%

4.8%

49.4%

46.5%

40.3%

43.4%

10.7%

7.4%

7.4%

6.9%

6.8%

6.5%

80%

20 years or
more

40%
66.2%

57.3%

58.5%

58.5%

54.2%

53.5%

51.5%

0%

0%
End of
3rd FP

End of
5th FP

End of
7th FP

End of
9th FP

End of11th FPEnd of13th FP

44.5%

45.3%

42.9%

15 years19 years
10 years14 years

17.1%
14.0%

25.2%
31.6%

IPO

17.1%

6.8%

13.0%

12.5%

29.9%

28.8%

11.3%
1.3%

12.2%
1.3%

End of11th FPEnd of13th FP

19.8%

100,000㎡
or more20%

End of
1st FP

41.2%

60%
50,000㎡99,999㎡

20%

IPO

4.9%

17.7%

11.5%

71.8%

th

End
End ofof 13
13th FPFP
Ａｖｅｒａｇｅ:
Ａｖｅｒａｇｅ
Ａｖｅｒａｇｅ:: 18.6
18.6 years
years

Age of Buildings

12.2%

10.6%

40%

0.7%

19.8%

Scale (based on total floor space)

80%

0.7%

80%

40%

0%

100%

0.8%

60%

60%

40%

2.6%

32.6%

39.2%

41.8%

5 years-9
years
Less than
5 years

29.1%

End of
1st FP

11.4%

12.4%

End of
3rd FP

End of
5th FP

5.8%
End of
7th FP

End of
9th FP※In the above graphs, percentage figures are calculated based on acquisition price and the average is a weighted average based on acquisition price.

38

VII - 3. Portfolio Overview (as at end of 13th FP)
Asset
Class

Area

Property

100.0

1

1.4

Mar 1, 2006

33,000

17.9

100.0

7

1.2

Mar 27, 2008 267,132.67

10,914.20

Oct. 2001

20,000

10.8

100.0

1

1.5

Kanda Nishiki-cho 3-chome
Building

Chiyoda Ward,Tokyo

Jan 13,2010

12,169.78

8,025.65

Mar.1973

12,700

6.9

100.0

1

7.0

Mar 1, 2006

10,063.05

7,301.15

Apr. 1989

9,660

5.2

98.8

6

6.4

Mar 19, 2008

4,958.29

3,060.43

May 1991

5,770

3.1

77.5

2

9.6

Mar 30, 2012

7,981.27

6,032.24

July 1987

5,610

3.0

100.0

1

7.0

Mar 1, 2006

5,511.83

4,537.66

Nov. 1959

5,156

2.8

100.0

10

14.1

Mar 1, 2006

16,206.34

5,850.23

Dec. 1994

2,091

1.1

89.6

1

2.8

－

141,179.05

135,937

73.7

99.0

30

－

56,351.42

61,763.28－
Aug. 1993
etc.

12,000

6.

5

100.

0

2

3.6

45,338.37

51,098.42

Oct. 1994

8,900

4.8

100.0

1

7.7

28,930.36

14,960.69

Oct. 2005

4,335

2.4

100.0

3

8.5

－

127,822.39－

25,235

13.7

100.0

6

－

3,455.

68

Feb. 2004

2,400

1.

3

96.

9

1

6.6

Kanda Park Plaza
Faret East Building

Minato Ward,Tokyo
Minato Ward,Tokyo
Chuo Ward,Tokyo
Chiyoda Ward,Tokyo
Tachikawa City,Tokyo

Subtotal（9 Properties）
Sagamihara City,
Sagamihara Shopping Center
Kanagawa Pref. Mar 1, 2006
Ito-Yokado Higashi-Narashino
Narashino City,
Jun 30, 2006
Store
Chiba Pref.
Saitama City,
Musashiurawa Shopping Square
Mar 19, 2007
Saitama Pref.
Subtotal（3 Properties）

Top Residence Nihonbashi
Central Tokyo Kayabacho
Fukasawa House Towers H&I
Ecology Toyosu Procentury
Impress Musashi-Koganei
Top Residence Yoga

Chuo Ward,Tokyo
Setagaya Ward,Tokyo
Koto Ward,Tokyo
Koganei City,Tokyo
Setagaya Ward,Tokyo

Feb 1, 2012

4,540.

Dec 8, 2006

12,135.36

11,357.44

Jun. 2004

10,635

5.8

97.8

1

1.6

May 30, 2008

9,630.96

6,789.03

Jan. 2005

5,160

2.8

95.7

1

10.6

Aug 12, 2011

2,471.30

2,056.41

Jun. 2008

1,223

0.7

93.4

1

6.4

Oct 14, 2011

1,894.35

1,512.38

Feb. 2008

1,165

0.6

92.7

1

8.6

25,170.94－

20,583

11.2

96.4

5

－

6,121.85

6,121.85

Central Tokyo OAK PLAZA

Apr. 1985

2,590

1.4

100.0

1

7.7

Subtotal（1 Property）－

6,121.85

－

2,590

1.4

100.0

1

－

－

300,294.23

Total（18 Properties）－

184,345

100.

99.

42

2.6

70

－

Subtotal（5 Properties）
Other

22.8

72,238.03

Oct. 2001

Shinkawa Chuo Building

Residential Tokyo
Metropolitan
Area41,950144,476.05

PML
(%)

23,219.46

Shiba-Koen Building

Tokyo
Metropolitan
Area

Jan. 1990

Mar 3, 2006

Occupancy Number ofRate
Tenants(%)

267,132.67

OfficeRetailPortfolio
Share
(%)

Total Floor
RentableCompletion
Space (m2) Floor Space (m2)
DateHarumi Island Triton Square
Office Tower Y
Harumi Island Triton Square
Office Tower Z

Akasaka Oji Building

Tokyo
Metropolitan
Area

AcquisitionPrice(mm yen)Acquisition
Date

Minato Ward,Tokyo
Chuo Ward,Tokyo
Chuo Ward,Tokyo

NEC Head Office Building

Central Tokyo

Address

Chiyoda Ward,Tokyo

Mar 20, 2007

0

2

39

VII - 4. Operating Income by Property (Thirteenth Fiscal Period)(million yen)

NEC
Head
OfficeBuilding

HarumiIslandTritonSquareOfficeTower Y

Harumi
Kanda
IslandNishiki- Akasaka
Tritoncho
Oji
SquareOffice 3-chome Building
Tower Z Building(Note)(Note)

Shiba- Shinkawa
Koen
Chuo
Building Building

Kanda
Park
Plaza

ItoMusashi
Fukasawa
Top
Faret
Impress
Sagamihar Yokado
EcologyTopurawa Residence Housea Shopping HigashiToyosu Musashi- Residence
East
Nihonbashi
Towers Procentury
Center Narashino Shopping
Yoga
Building
Koganei
Square Kayabacho
H&I
Store

OAK
PLAZA

184days184days184days184days184days184days184days184days184days184days184days184days184days184days184days

Operatingperiod (days)

184days184days

Total revenue
from property
leasing

1,370

1,217

135

98

204

176

151

407

236

129

90

240

164

44

37

94

Rent revenue －real estate

1,370

1,217

135

98

200

176

151

407

236

129

84

233

155

41

35

94

210

351

83

26

28

39

67

59

35

17

15

58

41

11

8

18

1

158

22

7

13

8

30

2

1

1

10

35

20

5

5

0

205

89

39

8

0

13

11

52

27

14

0

15

8

2

1

13

Utilities
expenses

-

96

15

8

11

14

22

-

-

-

1

0

1

0

0

-

Repairexpenses

-

1

3

0

2

2

0

3

4

0

3

5

10

2

0

2

Non-life
insurance
expenses

1

2

0

0

0

0

0

0

0

0

0

0

0

0

0

0

Other

1

2

2

-

0

0

1

1

0

1

0

2

0

0

0

1

Total expenses
from property
leasing
Property
management
expenses
Taxes and dues

184days

1,160

865

284

355

51

72

176

136

84

348

200

111

74

181

122

33

29

76

[5.5%][5.2%][2.8%][5.6%][1.1%][2.5%][6.3%][5.3%][8.1%][5.8%][4.5%][5.2%][6.2%][3.4%][4.8%][5.4%][5.1%][5.9%]

Depreciation
andamortization

223

245

120

35

32

17

33

13

34

54

72

49

27

66

45

17

13

12

Operatingincome

937

620

164

320

18

54

143

123

49

293

127

62

47

115

77

15

16

64

Capitalexpenditures

16

17

2

5

5

5

37

5

0

3

4

0

-

0

0

-

-

1

NOI
(NOI yield)

Renewal offire prevention equipment

Renewal offire prevention equipment

Renewal of common area
(Note) Some figures for Harumi Island Triton Square Office Tower Z and Kanda Nishiki-cho
3-chome Building are not disclosed due to request by the tenants.

40

VII - 5. Property Details: Office Buildings

Property

NEC Head Office Building

Property

Harumi Island Triton Square Office Tower Y

Property

Harumi Island Triton Square Office Tower Z

Address

Shiba, Minato Ward, Tokyo

Address

Harumi, Chuo Ward, Tokyo

Address

Harumi, Chuo Ward, Tokyo

Floor Area

144,476.05m2

Floor Area

267,132.67m2

Floor Area

267,132.67m2

Completion

January 1990

Completion

October 2001

Completion

October 2001

Title

Co-ownership (50%)

Title

Co-ownership (3rd – 15th floors)

Title

Co-ownership (a part of the 17th floor and18th – 22nd floors)

Acquisition Price

41.95 billion yen

Acquisition Price

33 billion yen

Acquisition Price

20 billion yen

41VII - 5. Property Details: Office Buildings

Property

Kanda Nishiki-cho 3-chome Building(formerly called “Sumitomo Corporation
Nishiki-cho Building”)

Address

Kanda Nishiki-cho, Chiyoda Ward, Tokyo

Floor Area

Property

Akasaka Oji Building

Property

Shiba-Koen Building

12,169.78m2

Address

Akasaka, Minato Ward, Tokyo

Address

Shiba, Minato Ward, Tokyo

Floor Area

10,063.05m2

Floor Area

4,958.29m2

Completion

March 1973 (large-scale renovation
undertaken in November 2001 andearthquake-resistant reinforcement
construction implemented in October 2009)

Completion

April 1989

Completion

May 1991

Ownership

Co-ownership (1st – 7th floors)

Ownership

Title

Title

Title

12.7 billion yen

Acquisition Price

9.66 billion yen

Acquisition Price

Acquisition Price

5.77 billion yen

42VII - 5. Property Details: Office Buildings

Shinkawa Chuo Building

Property

Kanda Park Plaza

Property

Faret East Building

Address

Sinkawa, Chuo Ward, Tokyo

Address

Kajicho, Chiyoda Ward, Tokyo

Address

Akebonocho, Tachikawa City, Tokyo

Floor Area

7,981. ㎡

Floor Area

5,511.83m2

Floor Area

16,206.34m2

Repair work to enhance earthquake resistance in2003

Completion

December 1994

OwnershipTitle

Co-ownership (2nd – 5th and a part of the
6th and 8th floors)

Acquisition Price

2.091 billion yen

Property

27

Completion

July 1987

Completion

Title

Ownership

Title

Acquisition Price 5.61 billion yen

November 1959

Acquisition Price 5.156 billion yen

43VII - 6. Property Details／Residential
Property

Fukasawa Towers H&I

Address

Fukasawa, Setagaya Ward,Tokyo

Floor Area

12,135.36m2

Completion

June 2004

Title

Co-ownership (H&I)

AcquisitionPrice

10.635 billion yen

Ecology Toyosu Procentury

Property

Toyosu, Koto Ward, Tokyo

Address

9,630.96m2

Floor Area

January 2005

Completion

Ownership

Title

5.16 billion yen

Acquisition
Price

44

VII - 6. Property Details／Residential

Property

Top Residence Nihonbashi
Kayabacho

Address

Nihonbashi Kayabacho,
Chuo Ward, Tokyo

Floor Area

4,540.70m2

Completion

Property

Top Residence Yoga

Address

Tamagawadai, Setagaya Ward,Tokyo

Floor Area

1,894.35㎡

Completion

February. 2008

Ownership

Title

Ownership

1.2234 billion yen

Acquisition Price

1.165 billion yen

Property

Impress Musashi-koganei

AddressNakamachi, Koganei-shi,Tokyo

Floor Area

2,471.30 m2

February,2004

Completion

June.2008

Title

Ownership

Title

Acquisition Price

2.40 billion yen

Acquisition Price

45

VII - 7. Property Details: Retail Properties and Other Properties

Property

Sagamihara Shopping Center

Property

Ito-Yokado Higashi-Narashino Store

PropertyMusashiurawa Shopping Square

PropertyOAK PLAZA

Address

Kobuchi, Sagamihara City,
Kanagawa Pref.

Address

Higashinarashino, Narashino City,
Chiba Pref.

Address

Bessho, Minami Ward, Saitama
City, Saitama Pref.

Address

Kanda Awajicho, Chiyoda Ward,Tokyo

Floor Area

56,351.42m2

Floor Area

45,338.37m2

Floor Area

28,930.36m2

Floor Area

6,121.85m2

Completion

August 1993

Completion

October 1994

Completion

October 2005

Completion April 1985
Completion of the conversion in 2007

Title

Ownership

Title

OwnershipTitle

Co-ownership (50%)

Title

Ownership

AcquisitionPrice

8.9 billion yen

AcquisitionPrice

4.335 billion yen

AcquisitionPrice

2.59 billion yen

AcquisitionPrice

12 billion yen

46

VIII. Appendix: Structure of Related Parties

47

VIII - 1. Characteristics of Top REIT and Operational Strategies
Top
Top REITREIT Asset
Asset
Management
Management (TRAM)(TRAM)

Asset
Management

Top
Top REIT
REIT

1. Skilled Management of a Diversified Portfolio(1) Pursuit of both external growth and quality of assets managed

Diversified Portfolio(2) Pursuit of stability and growth potential of profitability through uniqueasset class

OfficeDevelopment
Development(3) Strategic application of commissioned reports from a think tankBrokerage
Brokerage
Property
Property
Management
Management

Capital+Human
Resources

DNA
DNA

RetailThree
Three Major
Major
Asset
Asset Types
Types

Residential

Other Asset
Types

2. Optimal Application of Sponsor Strengths(1) Steady external growth through pipeline function

i.e., hotels andwarehouses

Asset
Asset
Management
Management(2) Agile acquisition of properties through warehousing function(3) Achieving internal growth through “management-added benefits”

Sponsors
Sponsors
Sumitomo Mitsui Trust
Bank, Limited.

Ensuring SteadyRevenue69%

SupportMaximizing Unitholders’ ValueOji Real Estate
A wholly-owned subsidiary of
Oji Management Office Inc.

31%

Sponsors’Sponsors’Strengths
Strengths

Utilizing Sponsor Strengths
Inheriting Sponsors’ DNA

Steady Growth ofPortfolio

Sponsor skills shall be utilized to achieve steady growth by applying their real estatedevelopment abilities, brokerage networks and management skills, including leasing
activities that utilize the leasing demand from sponsors’ groups/clients.
Number of group companies (as of March 31, 2012)



Excellent personnel have been dispatched to TRAM from the sponsors to ensure realestate investment expertise as well as inheritance of their corporate groups’ assets,that is, a long-term strategic view and diversified know-how acquired through each of
the sponsor’s businesses.

Sumitomo Mitsui Trust Holdings Group101

Oji Paper Group

344

48

VIII - 2. Overview of Asset Manager
Name

Top REIT Asset Management Co., Ltd.

Address

1-3-7 Yaesu, Chuo Ward, Tokyo

EstablishedOct. 22, 2004

Paid-in Capital¥300mnGeneralGeneral Meeting
Meeting ofof Stockholders
Stockholders
AuditorBoard of Directors
Investment and Management Committee

Shareholders

Sumitomo Mitsui Trust Bank, Limited. 69%
Oji Real Estate Co., Ltd. 31%

Business
Description

Investment
Investment management business
Department(Registered Financial Instruments
Business Operator No. 365 (Kinsho), issued by the
Director-General of the Kanto Local Finance Bureau)

Risk and Compliance Committee

Representative
Director and President
Compliance Officer
AssetManagement
Department

Finance
Department

Planning and
Administrative
Department

Compliance
OfficeFinance and Accounting GroupIR Group※The head of the Compliance OfficeDirectors

President and Representative
Director:

Nobuhito Endo

Milestones

Dec. 10, 2004:

Top REIT Asset Management (TRAM) obtained a license as a real estate agent (The Governorof Tokyo No. (1) 83904)
TRAM obtained approval for a discretionary agent license for real estate transactions(The Minister of Land, Infrastructure and Transport No. 35)
TRAM obtained approval as an asset manager for an investment corporation(The Prime Minister No. 47)
TRAM entered into an Asset Management Agreement with Top REIT, Inc.
TRAM was deemed a Registered Financial Instruments Business Operator (Investment
Management Business), No. 365 (Kinsho), issued by the Director-General of the Kanto Local
Finance Bureau
TRAM formally submitted applications to register as Financial Instruments Business Operator(Investment Management Business)
TRAM renewed a license as a real estate agent (The Governorof Tokyo No. (2) 83904)

May 10, 2005:
June 28, 2005:
Nov. 2, 2005:
Sept. 30, 2007:

Nov. 27, 2007:
Dec. 10, 2009:

Portfolio Management Group

concurrently serves as the Compliance
Officer49

済

VIII - 2. Overview of Asset Manager【 Decision-Making Process 】

Report of minority opinions(Note 1)

(Note 2)

Risk and Compliance
Committee
Department in chargeof preparing proposal

Compliance Office

Examination

Examination
anddecision(Rejection)
ReturnBoard of Directors
Final
Decision

Investment andManagement Committee

Examination
anddecision(Rejection and/or Suspension)(Note 3)

Examination
anddecision(Rejection)(Note 1) Proposals will be passed to the Risk and Compliance Committee if they fall under eitherof the following:• Material transactions with interested parties defined in the rules on transactions with interested parties(a unanimous vote is required in this case.)• The head of the Compliance Office recognizes the discussion of the issues in the Risk and Compliance Committee to be necessary.
(Note 2) Proposals will be passed to the Board of Directors if they fall under any of the following:• The price of the proposed acquisition or sale is over 10 billion yen and over 10% of Top REIT’s total assets.
• Material transactions with interested parties defined in the rules on transactions with interested parties• Forward commitment transactions• Capital raising plans (final decisions on raising capital shall be made by the Board of Directors of Top REIT.)(Note 3) The head of the Compliance Office can suspend discussions and decisions and return the item to the Department in charge of the proposal if he or she
judges that the item has legal problems in the process of discussions or decision making at the Investment and Management Committee.

50

Contact
IR Contact
Shusaku Ohashi,
Nobuyuki Hirano,
Junko Yoshii
Investor Relations
Top REIT Asset Management Co., Ltd. (Asset Manager)
Phone: +81-3-3243-2181
Fax:+81-3-3243-2182
E-mail: info-top@top-reit-am.co.jp
HP:
http://www.top-reit.co.jp/english/
The contents of this document, including summary notes, quotes, data and other information, are provided solely
for informational purposes and not intended to constitute an offer, solicitation and/or promotion of any specificproducts including investment units of Top REIT, Inc..
Forward looking statements in this document shall not be viewed as a guaranty of Top REIT’s future
performance.
Although every attention has been paid to the contents of this document, the accuracy and appropriateness of
the information included in this document is not guaranteed and the contents can be revised and/or cancelled
without notice.
All rights regarding use of these materials belong to Top REIT. No copy or use of the content shown in thesematerials shall be permitted without the prior consent of Top REIT.

51