[For Information Purpose Only.
The Japanese language press release should be referred to as the original.]
July 17, 2018
To All Concerned Parties
Name of REIT Issuer:
Invincible Investment Corporation
Name of representative:
Naoki Fukuda, Executive Director
Roppongi Hills Mori Tower
6-10-1 Roppongi, Minato-ku, Tokyo, Japan(Securities code: 8963)
Asset manager:
Consonant Investment Management Co., Ltd.
Naoki Fukuda, CEOContact: Jun Komo
General Manager of Planning Department(Tel. +81-3-5411-2731)
Notice concerning Acquisition of TK Interest with Overseas Real Estate as Underlying Assets

Invincible Investment Corporation (“INV”) is pleased to announce the acquisition of 100% TK interest in two
neighboring hotel properties in Grand Cayman, the Cayman Islands, the Westin Grand Cayman Seven Mile
Beach Resort & Spa (the “Westin”) and the Sunshine Suites Resort (the “Sunshine Resort”). The TK
investment in the two properties provides an unleveraged 9.2% NOI yield (Note 1) and is expected to offer
growth opportunities based on recent renovations, tourism growth, and the airport expansion scheduled to becompleted later this year (Note 1). At the same time, Consonant Investment Management Co., Ltd. (“CIM”),
the asset manager of INV, has also decided on July 17, 2018 that INV will acquire trust beneficiary interests infour domestic hotel properties (the “Four Domestic Hotel Properties”) and enter into new leasing contracts
with respect to each of the Four Domestic Hotel Properties. For details, please refer to “Notice concerning
Acquisition and Lease of Domestic Trust Beneficiary Interests” announced on July 17, 2018.
(Note 1)1.

See (Note 1) and (Note 3) of “2. Reasons for Acquisition”.

Overview of the Acquisition(1) Asset to be acquired(2) Anticipated acquisition price(3) Name of underlying asset

TK interest in a Cayman Islands special purpose company that plans toacquire 99-year Leasehold Interests (Note 1) (with a lease payment of
USD 1 or KYD 1 per year) in overseas real estate as underlying assets(Note 2) (the “Cayman Hotel TK Interest” or “Asset to be Acquired
overseas”)
USD 339,836,000 (JPY 37,382 million) (Note 3) for 100.0% of the
Cayman Hotel TK Interest (Note 4)
Westin Grand Cayman Seven Mile Beach Resort & Spa and Sunshine
Suites Resort(each an “Underlying Asset”, and collectively theThis English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

1(4) Agreement date(5) Anticipated acquisition date(6) TK operator(7) Source of acquisition funds(Note 1)

(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)2.

“Underlying Assets”, or the “Two Overseas Hotel Assets”)
July 17, 2018
One business day prior to the acquisition date of the underlying assets,
which is expected to close by October 31, 2018 or the date separately
agreed (Note 5)
Seven Mile Resort Holdings Ltd (the “Cayman SPC”).
For the overview of the TK operator, please refer to “4. Overview of TK
Operator” below.
Funds from issuance of new investment units (Japanese primary offeringand overseas offering and third-party allotment) (the “Offerings”) (Note 6),
new borrowing (Note 7) and cash-on-handRights equivalent to long-term real estate leasehold rights in Japan (hereinafter referred to collectively as the“Leasehold”). The TK operator will also acquire some movables including FF&E pertaining to hotel operations. “FF&E”
is an abbreviation for furniture, fixtures and equipment, which are the assets necessary for hotel operation, such as
furniture, fixtures, equipment and kitchen equipment (hereinafter the same).
Real estate related asset to be acquired by the TK operator issuing the TK interest that INV will acquire; i.e., the realestate that will be the revenue source of INV. Hereinafter the same.
Calculated using an exchange rate of 1 USD=110 JPY (rounded down to the nearest yen) as of June 27, 2018
announced by Mizuho Bank Ltd. Hereinafter the same. INV will make payment denominated in USD (USD 339,836
thousand), and will enter into certain transactions to hedge foreign currency exchange risk, as described in “9. Conceptof foreign currency exchange risk hedge size and hedge ratio” below.
The anticipated acquisition price is INV’s anticipated investment amount for the Cayman Hotel TK Interest. The amount
does not include any taxes payable including consumption tax and is rounded down.
The “anticipated acquisition date” (hereinafter the same) will be one business day prior to the date when the Cayman
SPC (TK operator) will acquire the underlying assets, which will be (a) as soon as possible, using commerciallyreasonable efforts, after all conditions to closing have been satisfied or waived, and in any event by October 31, 2018,or (b) such other date as may be agreed upon with the sellers. Conditions precedent to closing under the purchase andsale agreement include, among others, obtaining (i) governmental approvals relating to the transfer of the Leaseholdand (ii) permits under the laws of the Cayman Islands required for the operation of the two Overseas Hotel Assets(including operation by the Special Purpose Company to which the Cayman SPC entrusts the hotel operation).
For more information about issuance of the new investment units, please refer to “Notice concerning Issuance of New
Investment Units and Secondary Distribution of Investment Units” announced today.
For more information about new borrowings, please refer to “Notice concerning Debt Financing” announced today.

Reasons for Acquisitions

CIM believes the Cayman Hotel TK Interest is attractive for INV given the high NOI yield of 9.2% (Note 1), highquality of the assets, excellent location, and attractive supply/demand for hotels in the Cayman Islands. As
described further below, the Westin has undergone a USD 42 million renovation over the past approximately
1.5 years and is located on one of the highest rated beaches in the Caribbean. The Cayman Islands are an
Aa3 rated British Overseas Territory with a currency pegged to the US Dollar and are a major financial centerand vacation destination. The airport is currently operating above capacity, with 837,569 passenger arrivals in2016 (Note 2), but the completion of the international airport expansion later this year will further raise thecapacity (Note 3). At the same time, there is limited new supply of hotels in the Cayman Islands, particularly
with respect to hotels in the same price category as the Westin and Sunshine Resort. Moreover, affiliates ofFortress Investment Group LLC (“FIG”) have been managing the hotels for approximately four years, and after
the acquisition, a Fortress affiliate will continue to be involved in asset management of the hotels to help
ensure continuity. Another noteworthy feature of the Cayman hotels is that they are expected to even out theeffects of seasonality in INV’s portfolio, which currently generates approximately 47.2% (Note 4) of NOI in thefirst half of the year. Approximately 70% of the simulated TK distribution (Note 5) is from the first half of 2018,
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

2which would help balance out the overall NOI of INV.
INV plans to acquire the Cayman Hotel TK Interest (the “Acquisition”) using funds raised through the issuanceof the new investment units, new borrowings and its own funds. The Cayman SPC will acquire the Westin and
the Sunshine Resort located in the British Cayman Islands from Fortress-related Funds.
(Note 1)

(Note 2)
(Note 3)(Note 4)(Note 5)“NOI yield” of the Cayman Hotel TK Interest is calculated for reference by the following formula;(Simulated NOI of the Underlying Assets - simulated cost in the Cayman SPC) ÷ the amount of investment in the
Cayman Hotel TK Interest.
INV believe such figure is more comparable with the NOI of trust beneficiary interests in real estate that the distribution
amount of the Cayman Hotel TK Interest. Further, the simulated distribution yield of the Cayman Hotel TK Interest
calculated the following formula is 6.9%.
Simulated distribution to the Cayman Hotel TK Interest (Total of simulated NOI of the Cayman hotels – simulated
depreciation cost - simulated cost in the Cayman SPC) ÷ the amount of investment in the Cayman Hotel TK Interest.
Simulated NOI of the Underlying Assets, simulated cost in the Cayman SPC, simulated depreciation cost andsimulated distribution include estimates, are different from actual NOI of the Underlying Assets, cost in the Cayman
SPC, depreciation cost and distribution and do not include exchange hedge.
Inbound Flights represent the number of airplane seats coming into Cayman Islands. Source: Government of the
Cayman Islands Economics and Statistics Office, Cayman Islands Department of Tourism.
Based on the information published on August 23, 2017 by Cayman Islands Airports Authority, which manages the
airport; however, the plan may have changed, or may be changed in the future.
Based on simulated 2018 NOI (Jan-May: Actual / Jun-Dec: Forecast + Budget) of the properties owned by INV as ofJune 30, 2018 calculated by CIM adjusted to reflect trust fees and insurance premiums assuming the properties had
been held by INV through 2018. The simulated NOI includes the amount of the estimated annual dividend by JV TMK
which holds SGTB incorporating the various costs of JV TMK calculated by CIM.
Assuming INV has received the TK distribution backed by Asset to be Acquired overseas since the beginning of 2018.

(1) Location
The Cayman Islands, in which the Westin and Sunshine Resort are located, is an overseas territory of theUnited Kingdom and Moody’s rating agency has assigned an Aa3 rating to its sovereign debt. This territory,
which has highly stable political and economic systems, has close economic ties to the U.S. owing to its
geographical proximity, and U.S. citizens represent the largest group of inbound visitors. The number ofhotel guests has experienced a steady increase, as the Cayman Islands, and specifically Seven Mile
Beach, are recognized as one of the popular resort destinations and top rated beach in the Caribbean. In
response to an increase in the number of visitors, the Owen Roberts International Airport on Grand
Cayman Island is currently undergoing renovation and expansion. The number of visitors is expected toincrease further after the scheduled completion of the project in the second half of 2018.
The limited land available for new developments along with limited scheduled new competitive hotel supply
is expected to benefit Westin and Sunshine Resort in terms of maintaining stable room demand. The peakseason for hotel demand in the Grand Cayman Islands is from December to April, while INV’s existing
hotel portfolio has a higher percentage of profits weighted to the July to December period. Therefore, theacquisition of Asset to be Acquired overseas should provide seasonal balance to the income stream for
INV. For details of distributions from the Cayman Hotel TK Interest, please refer to “3. Details of the Assets
to be Acquired” as described below.
The Cayman dollar is pegged to the US dollar, and INV will hedge the annual projected cash flow from thetwo Cayman hotels using 6 and 12 month forward contracts. We believe current conditions facilitate anefficient forex hedging market. For the outline of the anticipated hedge of foreign currency exchange risk,
please refer to “9. Foreign Currency Exchange Risk Hedge Size and Hedge Ratio Considerations” as
described below.
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

3(2) Hotel
The Westin is a four-star hotel located in a prime location on the world famous Seven Mile Beach in Grand
Cayman Island, with the longest beach frontage (nearly 700 feet, or approximately 200 meters) on theisland. The Seven Mile Beach is also a popular location for diving. A USD 42 million full renovation of thehotel guest rooms and facilities was completed in December 2017. The hotel has 343 well-appointed andspacious rooms, and is well suited for leisure and business travel with spacious conference rooms, large
spa, family recreational facilities and six restaurants and bars.
Sunshine Resort is operated as the sister resort hotel to the Westin. Guests of Sunshine Resort haveaccess to many of the Westin’s amenities and services including access to the same private beach,through the mandatory resort fee (Note 1). All rooms in the hotel include a fully equipped kitchen that
includes a full-sized refrigerator, in addition to other amenities such as an open-air pool and highly-rated
restaurants. Sunshine Resort is designed to cater to extended-stay guests.
(Note 1) Separate from the lodging bill and charged per guest and per day.

(3) Operation
After the acquisition by the Cayman SPC, the operations of Asset to be Acquired overseas will continue tobe entrusted with Seven Mile Resort Management Ltd., which will sub-agree the actual hotel operation to
Pyramid Cayman Hotel Limited, which is an affiliate of Pyramid Hotel Group LLC, an international hotel
operator that manages hotels in the U.S., Caribbean and Europe (collectively, the “Operator”). Seven Mile
Resort Management Ltd. will also enter into a franchise agreement with an affiliate of Marriott International,
Westin Hotel Management, L.P. (the “Franchise Agreement”). Pyramid Hotel Group LLC is a privately held,
Boston-based hotel company with 97 hotels under management, comprising over 26,000 rooms and12,000 employees. Pyramid has managed the Westin since 2011and Sunshine Resort since 2015.
In connection with the investment in the Two Overseas Hotel Assets, Fortress Credit Advisors LLC will act
as an asset advisor of Seven Mile Resort Holdings Ltd. and Seven Mile Resort Management Ltd., and CIM
will also enter into an advisory agreement with Fortress Credit Advisors LLC to receive support on the
management, oversight and analyses of market information related to the Two Overseas Hotels.
Under the scheme described above, INV will capture all economic interests to be generated at the Cayman
SPC from operations of the Two Overseas Hotel Assets, except operational expenses.
Meanwhile, please refer to “8. Overview of Scheme” and “9. Foreign Currency Exchange Risk Hedge Sizeand Hedge Ratio” below for matters considered by INV before the Acquisition in overseas assets(especially the overview of the acquisition scheme and the hedging strategy concerning foreign currency
exchange risks, etc.).
3.

Details of the Assets to be Acquired(1) Overview of the Cayman Hotel TK Interest
The details of the Cayman Hotel TK Interest are described as follows:

Name

The TK Interest in the Westin and Sunshine Resort

Overview

Date of the execution of the TK Agreement
July 17, 2018

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

4Anticipated acquisition date
The anticipated acquisition date of the acquisition of the Underlying Asset by the Cayman
SPC is one business day prior to the date when the Cayman SPC (TK operator) acquires
the underlying assets, which will be (a) as soon as possible, using commerciallyreasonable efforts, after all conditions to closing have been satisfied or waived, and inany event by October 31, 2018, or (b) such other date as may be agreed upon with thesellers.
Amount of investment
USD 339,836,000 (JPY 37,382 million)
Name of the TK operator:
Seven Mile Resort Holdings Ltd. (the Cayman SPC) (For an overview of the TK operator,
please refer to “4. Overview of The TK Operator” below.)
Term of TK Agreement:
Ten years after the date of the execution of the TK Agreement (July 17, 2018) (or as suchdate may be extended by the parties thereto)
Total amount of TK investment:
USD 339,836,000 (JPY 37,382 million) (to be invested by INV on the business day prior
to the date of acquisition of the Two Overseas Hotel Assets)
Outline of TK Agreement
Accounting period: six-month semi-annual periods from April 1 to September 30 andfrom October 1 to March 31 of the next year, respectively. However, the first accounting
period is due to start on the date of execution of the TK Agreement and to end on
March 31, 2019. If the TK Agreement terminates, such termination date will mean an
end of the final accounting period.
Distribution profit and loss: All profits and losses as of the last day of the respective
accounting period will be attributed to the silent partner (INV) and all taxes andexpenses, etc. necessary for the TK operation, based on a reasonable estimate after
reserves, will be paid to the silent partner (INV) in cash on a USD-denominated basis.
(1) The Cayman Hotel TK Interest is a silent partnership (tokumei kumiai) interest in the
Cayman SPC as the TK operator and owner of the Leasehold. The Cayman SPC will
also acquire certain movables including FF&E pertaining to the hotel operations. The
overview of the Leasehold is as follows: the land constituting the Underlying Assets
is held by the British Crown, and the leasehold is established by the government of
the Cayman Islands as authorized by the British Crown. According to the laws of the
Cayman Islands, the buildings do not constitute an independent real estate asset,
and the Leasehold represents a right to the real estate assets including both the landThis English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

5and buildings.
(2) <Overview of Leasehold>
Westin Grand Cayman Seven Mile Beach Resort & Spa
Lease agreement

Variation of Lease concluded between Her Excellency(the latest variation of

The Governor of The Cayman Islands and CF GC Hotelthe agreement)

Sub Ltd. as of January 15, 2016

Lease period

99 years from March 3, 2016

Leases Payment

USD 1 per year

Area (estimate)7.249 acSunshine Suites Resort
Lease agreement

Variation of Lease concluded between Her Excellency(the latest variation of

The Governor of The Cayman Islands and CF GC

the agreement)

Sunshine Ltd. as of June 22, 2016

Lease period

99 years from June 22, 2016

Lease Payment

KYD 1 per year

Area (estimate)

6.290 ac (Note 1)(Note 1) This area includes the vacant land adjacent to the Sunshine Suites. While such vacant land issubleased as of the date of this document, the Cayman SPC will acquire this asset including such
subleased vacant land. The Area in the above table indicates an area including the vacant land, assuch sublease will be extinguished prior to or at the same time as the acquisition by the Cayman
SPC.

(3) Seven Mile Resort Management Ltd. (the “Hotel Operating SPC”), a special purpose
company established separately from the Cayman SPC under the laws of the
Cayman Islands, will be entrusted with all aspects of the hotel operations pursuant toa hotel management agreement with the Cayman SPC for each of the Westin and
the Sunshine Resort (collectively, the “Hotel Management Agreement”). Commonshares issued by the Cayman SPC and the Hotel Operating SPC will be 100%
owned by a general incorporated association (ippan shadan hojin) establishedaccording to the Act on General Incorporated Associations and General Incorporated
Foundations). The ippan shadan hojin is similar to a charitable trust and will notreceive any economics or distributions from the hotel operations. The outline of theHotel Management Agreement concluded between the Hotel Operating SPC and the
Cayman SPC is as follows.
Hotel management

Seven Mile Resort Holdings Ltd.

assignorThis English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

6Hotel management

Seven Mile Resort Management Ltd.

trustee
The agreement term shall last ten years from the Hotelmanagement assignor’s acquisition of the Two Overseas
Term of agreement

Hotel Assets and renew automatically every five year
unless the hotel management assignor and the hotelmanagement trustee mutually agree to termination of theagreement 75 days prior to the end of the term.

Remuneration

Equivalent to actual costs
Both the hotel management assignor and the hotel

Other special mattersmanagement trustee may cancel the Hotel Management
Agreement for any reason with 60-days’ written notice.

(4) The Hotel Operating SPC will enter into sub-management agreements for each of
the Westin and the Sunshine Resort (collectively, the “Sub-management
Agreement”) with Pyramid Cayman Hotel Limited (the “Hotel Operator”), whichcurrently manages the Two Overseas Hotel Assets, and delegate substantially all
hotel operation management services at the Two Overseas Hotel Assets to the Hotel
Operator. The Hotel Operating SPC is responsible for all accounting related to thehotel operations, and profits, after deducting expenses (including labor costs, fees
and commissions, etc.) and management fees, from revenues derived from theoperation of the Two Overseas Hotel Assets will be attributable to and paid to the
Cayman SPC in accordance with the Management Agreement and theSub-management Agreement.
(5) The Cayman SPC and the Hotel Operating SPC will obtain the relevant approvals
and licenses (including new Trade and Business Licenses and Local Companies
Control Licenses) necessary to conduct business under the legal system of the
Cayman Islands. However, as the Hotel Operator will be responsible for day-to-day
hotel operations, the Hotel Operating SPC will hold the hotel operator license andother ancillary licenses (including Liquor and Music and Dancing Licenses) and the
Cayman SPC will neither obtain nor hold these approvals and licenses. The Hotel
Operating SPC will also enter into a franchise agreement with Westin HotelManagement, L.P. as franchisor of the Westin hotel chain (the “Franchise
Agreement”). It is expected that it will take approximately 8 weeks for the Cayman
Holding SPC and the Hotel Operating SPC to obtain the above-mentioned approvals
and licenses, but it may take longer. If so, the acquisition of the Cayman Hotel TK
Interest will be delayed.
(6) Summary of the (planned) balance sheet of the Cayman SPC as of the scheduled
date of the acquisition of the Underlying Assets is as follows. The ratio of investmentin the Cayman SPC by INV will be 100%.
Cayman SPC(Assets)
Real estate assets, etc.

(Liabilities)(Note 1)(Note 2)

Interest-bearing debt-

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

7

JPY 36 billion
Other assets

JPY 1.3 billion

Total Assets

JPY 37.3 billion(Note 1)

(Note 2)

(Note 3)(Owners’ Equity)
TK Interest, etc.

JPY 37.3 billion

Total Liabilities and Owners’ Equity
JPY 37.3 billion

Refers to Real Estate, etc. specified in Article 1201 Item 12 of the Securities Listing
Regulations, and the estimated amount of the Leasehold of the Underlying Assets to berecorded in the balance sheet is stated.
The Cayman SPC is scheduled to acquire the Leasehold, etc. of the Underlying Assets, for
USD 305,000,000 (JPY 33,550 million) by October 31, 2018 or the date separately agreed,
immediately when all the preceding conditions for sale and purchase as provided in the saleand purchase agreement on the Two Overseas Hotel Assets by the Cayman SPC as the TK
Operator. For more information about the Underlying Assets, please refer to the following“Outline of the Underlying Assets”.
Fortress Credit Advisors LLC will be appointed as an asset advisor of the Cayman SPC andthe Hotel Operating SPC.

(7) In addition to the above, the following constraints will be imposed with regard to theseries of transactions related to the acquisition of the Cayman TK Interest:
Acquisition of the Leasehold will require the approval of the Cayman Islands
government and the approval process is expected to take approximately four to six
weeks. Also, it is expected that it will take approximately 8 weeks for the Cayman
SPC and the Hotel Operating SPC to obtain the above-mentioned approvals andlicenses. If it takes longer to complete procedures to obtain approvals and licenses,
the acquisition of the Two Overseas Hotel Assets by the Cayman SPC, and theacquisition of the Cayman Hotel TK Interest by INV, will be delayed. If any of theconditions precedent to closing under the purchase and sale agreement for the Two
Overseas Hotel Assets is not fulfilled or waived by October 31, 2018 or any otherdate separately agreed with the seller, the sale and purchase agreement may beterminated by the sellers of the Two Overseas Hotel Assets and as a result the
Cayman SPC would not acquire the Two Overseas Hotel Assets, which means that
the Cayman SPC may not be able to acquire the Cayman Hotel TK Interest. As thesame process of obtaining approvals, etc. needs to be completed when the Cayman
SPC sells the Two Overseas Hotel Assets in the future, such sale, etc. may bedelayed or fail to be executed.
(2) Details of the Underlying Assets
Details, profit and loss status and outline of appraisal reports of the Underlying Assets are as
follows:<Explanation of details of the Underlying Assets>a.

“Name and Location of the Underlying Asset, etc.” column:

・“Appraisal Value” shows reported price by the appraiser for the anticipated acquisitions. For appraisal of
the Underlying Assets, INV adopted the local appraiser verification method and entrusted suchverification to CBRE, Inc. and CBRE K.K. For local appraiser verification method, please refer to“Summary of Real Estate Appraisal Report”.
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

8

2

2

・

The details in “Location” (excluding address), “Lot Area (m )” of the “Land” and, “Total Floor Area (m )”,“Structure/No. of Stories”, “Purpose of Use”, and “Completion Date” of the “Building” are, unlessotherwise stated, as shown in the property register. The “Total Floor Area” is the gross floor area (if noannotation in the context, an annex building would not be included), and with respect to “Purpose ofUse,” the primary ones of the purposes shown in the property register is listed. Further, the “CompletionDate” lists the time at which the building was newly constructed, as shown in the property register.

・In “Zoning”, the class of zoning under the respective items are based on the Cayman laws.

b.

Description in a column “Overview of Management Agreement”

・An overview of the Hotel Management Agreement which Cayman SPC is expected to enter into upon
the Acquisition is described in this column.

c.

Description in a column “Overview of Building Conditions Survey Report”
For acquisition of the Underlying Asset, INV has received a report from EBI Consulting on matters
including building deterioration survey, short-term and long-term repair plan, compliance survey related
to Building Standards Act, etc., survey of dangerous substances contained in a building, and soil
environment survey. An overview of the report is described in this column.

・“Replacement Price” means the total amount of the appropriate costs needed in the event that theappraised building is to be rebuilt at the time of the survey.

・“Short term Repair Costs” indicates the repair and/or replacement costs for items which, at the time ofthe survey, do not meet minimum requirements for maintenance due to significant deterioration or are inviolation of laws or regulations or for findings that may require repair or replacement within one year.

・“Long term Repair Costs” consist of capital expenditure and repair costs. Capital expenditure means, of
all improvement costs that are expected to be needed to maintain the conditions of the building at thelevel set for maintaining building functions, costs to extend the usable period of the building utilities or to
replace it entirely. Repair costs mean, of all improvement costs that are expected to be needed tomaintain the conditions of the building at the level set for maintaining building functions, costs other thancapital expenditures.

d.

Description in a column “Overview of PML Report”
For acquisition of the Underlying Assets, INV has received a report from Tokio Marine & Nichido Risk
Consulting Co., Ltd. on analysis related to earthquake risks. An overview of the report is described inthis column.

・“Probable Maximum Loss (PML)” means the probable maximum loss from an earthquake.
Though there is not a strict, uniform definition for probable maximum loss (PML), in this press release, itmeans to what extent damages would be borne from the largest-scale anticipated earthquake in the
anticipated planned term of use (50 years) (a large earthquake that has a reoccurrence period of 475
years = a large earthquake with a 10% chance of occurring in 50 years), as indicated by the percentage(%) of the replacement cost for planned recovery costs from damage.

e.

Descriptions in the “Area Characteristics”
Descriptions in the “Area Characteristics” field are an abstract or summary of descriptions in the Real
Estate Appraisal Report on the Underlying Asset, prepared by appraisal agencies or market report
prepared by third-party experts, or created by referring to such descriptions.
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

9f.

Descriptions in the “Special Notes”
Descriptions in the “Special Notes” field are matters that are deemed important in consideration of theirimpact on rights, appraisal value, profitability and disposability of the Underlying Asset.

g.

“Income and Expenditures, Etc.” column

・Based on the information provided from the sellers of the Underlying Asset for each operating period
from January 1, 2016 to December 31, 2017. This is not a guarantee of future income and expenditures.

・Amounts are rounded down to the nearest USD 1. Therefore, the figures may not necessarily match thetotal value when added together. Unless otherwise specifically noted, the amounts do not include
consumption tax, etc.

・“Land Lease Fees” is based on the land lease fees applicable under a relevant lease agreement.

・“Taxes and Public Dues,” include property tax and city planning tax, which are generally imposed on theowner on January 1 of each year. For property tax and city planning tax that were borne by the previous
owner or current owner at the time of acquisition of the real estate related properties that INV owns orwill acquire, the estimated amount is included in the acquisition cost, and is therefore not included in“Taxes and Public Dues.”

・“Non-life Insurance Premiums” is the total amount of paid insurance premiums distributed proportionallyover the relevant period.

・“NOI” (Net Operating Income) lists in principle the actual figures as provided by the seller. With respect
to the trust fees, administration fees, depreciation and insurance premiums, the figure following theadjustments assuming that the asset is held by INV.

・

“Room Income” includes room use fees and lease fees.

・“Other Income” includes items such as parking lot use fees, laundry fees, vending machine transaction
fees, etc. which do not fall under “Room Income”.

・“ADR,” or Average Daily Rate, is the value of the total room sales for a certain period (excluding service
fees) divided by the total number of sold rooms for the same period.

・“RevPAR”, or Revenues Per Available Room, is calculated by dividing the total sales for a certain periodby the aggregate number of rooms for the same period (rooms x number of days), and is the same
figure as that of a product of room occupancy rate and ADR.

・“Room Occupancy Rate” is calculated using the following formula:
Room occupancy rate = total number of rooms occupied during the relevant period ÷ total number ofavailable rooms during the relevant period (aggregate number of rooms during the relevant period x
number of business days during relevant period)

・“GOP Ratio” is calculated using the following formula:
GOP ratio = GOP ÷ salesh.

“Summary of Real Estate Appraisal Report” column:
INV has requested real estate appraisal from appraisal agency for the Underlying Asset. For appraisal of
Underlying Assets, adopts local appraiser verification method and entrusted to CBRE, Inc. and CBRE
K.K. For local appraiser verification method, please refer to “Summary of Real Estate Appraisal Report”.

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

10

An appraisal value of a property is merely an opinion of the real estate appraiser regarding the value ofthe appraised property at the time the appraisal was conducted in accordance with the Act on Real
Estate Appraisal and real estate appraisal standards, etc.
A real estate appraisal is neither a guarantee nor a promise that an asset can be sold or purchased atsuch appraisal value either now or in the future.

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

11(Outline of the Underlying Asset)
Name and Location of the Underlying Asset, etc.
The name of theWestin Grand Cayman Seven Mile Beach Resort & Spa

Underlying Asset
Anticipated Acquisition

USD 255,300,000 (JPY 28,083 million)

Price (Note 1)
Appraisal Value

USD 258,100,000 (JPY 28,391 million)

Appraisal Agency

CBRE K.K.
(Lot Number)West Bay Beach North Registration Section Block 11D Parcel 45(Address)

30620 Seven Mile Beach Road, Grand Cayman, Cayman Islands

Location

Leasehold
Form of Possession

Hotel/tourism district(Long-term real estate

Zoningleasehold)7.249 ac
Lot Area

Building Coverage2(29,336 m )Ratio/Floor Area Ratio
231,728 ft2

Hotel
Land and Building-

Purpose of Use

Gross Building Area

2

(21,528 m )Construction Start

1994

343 rooms
Number of rooms

Date
Structure/No. of(T126・D199・ (Suite room) 18)
Steel framed and reinforced concrete structure with 5 stories

StoriesRenovation Date
Creation of security

May 2016 to December 2017-

interest
Overview of Management Agreement
Management Assignor

Seven Mile Resort Holdings Ltd.

Management Trustee

Seven Mile Resort Management Ltd.

Term

10 years from acquisition date

Management services fee

Actual cost

Special Notations for Revisions on Agreement and Service Fees
As long the management assignor and management trustee do not agree to end the agreement before 75 days prior to
Renewal Upon Expiration
the expiration, agreement will automatically renew every five years.
Management services fee-

revision
By written notice before 60 days prior to termination, both the management assignor and management trustee may
Other Special Matters

terminate agreement for any reason at any time.
The management assignor shall pay USD 343,000 as initial costs to the management trustee.

Overview of Building Conditions Survey ReportCompany Conducting
EBI Consulting

Date of Report

June 1, 2018-

Replacement Price-

SurveyShort term Repair Costs

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

12

(within 1 year)
Long term Repair Costs (inUSD 3,846,750
12 years)
Overview of PML reportCompany Conducting

Tokio Marine & Nichido Risk Consulting

SurveyCo., Ltd.,

Date of Report

June 2018

Probable Maximum Loss
0.6%
(PML)
Area Characteristics
The target property is a resort hotel located in Grand Cayman Island, the center of the Cayman Islands. This 4-star resort hotel stands facing Seven Mile
Beach, one of the most popular resort destinations in the island, which is renowned as a dive spot owing to its transparency and attracts many visitorsfrom the United States and European countries. This property faces a private beach with the length of 700 feet (approximately 200 meters), the longest
private beach held by hotels located along with Seven Mile Beach, offering opportunities of various kinds of water activity and winning popularity fromfamilies and other leisure enthusiasts. The lineup of 343 guest rooms consists of a range of rooms from twin rooms of 36m2 to suite rooms of 140m2,
while the hotel has six restaurants and bars, one of the largest banquet facilities in the island, the largest swimming pool in the island, and spa facilities
with 13 private treatment rooms. Full renovation works on guest rooms and communal spaces costing approximately USD 42 million were implemented
from 2016 to 2017, which resulted in its enhanced competitiveness. As Owen Roberts International Airport in Grand Caiman Island, at which expansion
projects are under way, serves for direct flights to and from major cities in North America, it is expected that the number of tourists visiting the island will
increase further.
Special Notes
Subject to the Franchise Agreement to be entered into between the Hotel Operating SPC and Westin Hotel Management, L.P., it may be necessary toobtain approval from Westin Hotel Management, L.P. if the Cayman SPC transfers the Underlying Asset or creates a security interest in the Underlying
Asset.
(Note 1)This price is not the anticipate acquisition price of the Cayman Hotel TK Interest acquired by INV but the anticipated acquisition price of theLeasehold, etc. of the Underlying Asset acquired by the Cayman SPC (Westin Grand Cayman Seven Mile Beach Resort & Spa).

Westin Grand Cayman Seven Mile Beach Resort & Spa
3. Income and Expenditures, Etc.
Operating Period

January 1, 2016 – December 31, 2016

January 1, 2017 – December 31, 2017

16,048,213

17,576,587

a. Rent Expense

50,09844,591b. Taxes and Public Dues

95,3400

1,412,067

1,401,018

47,754-2,983

NOI (= GOP - [a. + b. + c. + d.])14,442,954

16,133,961(1) Sales

47,143,093

49,960,978

Room Income

25,511,634

25,951,013

Other Income

21,631,459

24,009,965

31,094,880

32,384,391

324.05341.61

GOP (= (1) - (2)) (Note 1)c. Non-life Insurance Premiumsd. Other expense(Reference)(2) Operating Costs (not including a. throughd. above)
ADR

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

13

(Note 1)

RevPAR

203.22207.28

Room Occupancy Rates

62.7%

60.7%

GOP Ratio

34.0%

35.2%

Revenue from the leasing business is described assuming that the Cayman SPC owned the hotel property based on information provided by
the current property owner.

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

14

Westin Grand Cayman Seven Mile Beach Resort & Spa
Summary of Real Estate Appraisal Report
Appraisal Method

Local appraisal verification method

Appraising Organization

CBRE K.K.

Local Appraising Agency

CBRE, Inc

Appraisal Value (Specified Value)

USD 258,100,000

Time of Valuation

May 24, 2018

(Note 1) Under the method of “verification of an appraisal performed by a local appraiser,” a real estate appraiser licensed in Japan determines appraisal
value based on the understanding and analyses of basic data and information necessary for real estate appraisal, including appraisal methods
employed by local appraisers, and transaction examples and trends in local markets that are used for real estate appraisal, and by verifying thevalidity of decisions made in appraisal reports and appropriateness of appraisal value prepared by local appraisers. INV appoints CBRE, Inc., aprofessional appraiser licensed and certified in the Cayman Islands, as a local appraiser to engage in appraisal of the Underlying Asset andprepare a local appraisal report. INV then engages CBRE K.K., a company appointed as a real estate appraiser in Japan, to verify the local
appraisal report and then obtains a report on verification of appraisal performed by local appraiser. While any acquisition of a tokumei kumiai
interest does not need to obtain a real estate appraisal report based on Article 201-1 of the Act on Investment Trusts and Investment Corporations
and Article 122-2 of the Order for Enforcement of the Act on Investment Trusts and Investment Corporations, INV obtains a real estate appraisal
report (a report on verification of appraisal performed by local appraiser) as is the case in an acquisition of trust beneficiary interest, given the factthat the Underlying Asset of the Cayman Hotel TK Interest is the Leasehold.

Value of Profits using the Profit Capitalization Method (USD)(1) Direct Capitalization Method(a) Hotel Operating Profit①Operating Revenue

Contents

Overview

24,871,320

GOP

24,871,320(b) Non-life Insurance Premiums

1,543,524(c) FF&E Reserve

2,622,263―(d) Other Costs②Operating Costs (Expense Rate)=[(b)＋(c)＋(d)]4,165,787③Net Operating Income＝[①－②]20,705,533④Capitalization Yield

8.0%⑤Income Price using Direct Capitalization Method
256,900,000＝［③÷④](2) DCF Method

Contents

Overview① Total of Current Value of Net Income during
137,605,720
Analysis Period(a) Sale Price

337,051,593(b) Sale Costs

6,741,032(c) Returning Price＝[(a)－(b)]②Returning Price, Current Value

330,310,561
121,702,550③Discount Rate

10.50%④Final Capitalization Yield

8.25%

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

15⑤Income Price using DCF Method＝[①＋②]259,300,000(3) Income Price using Income Capitalization
258,100,000
MethodOther Points to be Noted for Appraisal by Apprising Organization
Verified and confirmed local basic materials and local appraisal report and confirmed appropriateness and that it has no issues.

(Outline of the Underlying Asset)
Name and Location of the Underlying Asset, etc.
The name of theSunshine Suites Resort

Underlying Asset
Anticipated Acquisition

USD 49,700,000 (JPY 5,467 million)

Price (Note 1)
Appraisal Value

USD 50,200,000 (JPY 5,522 million)

Appraisal Agency

CBRE K.K.
(Lot Number)West Bay Beach North Registration Section Block 11D Parcel 37(Address)

1465 Esterley Tibbetts Highway, Grand Cayman, Cayman Islands

Location

Leasehold
Form of Possession

Hotel/tourism district(Long-term real estate

Zoningleasehold)
Building Coverage

6.290 ac
Lot Area

2 (Note 3)(25,454 m )Ratio/Floor Area Ratio
72,367 ft2

Hotel
Land and Building

Purpose of Use

Construction Start-

Gross Building Area

1999

(6,723 m2)
131 rooms

Number of rooms
Date(T31・D40・(Suite room) 60)

Structure/No. of

Steel reinforced concrete structure with 3 stories

StoriesRenovation Date
Creation of security

October 2016-

interest
Overview of Management Agreement
Management Assignor

Seven Mile Resort Holdings Ltd.

Management Trustee

Seven Mile Resort Management Ltd.

Term

10 years from acquisition date

Management services fee

Actual cost

Special Notations for Revisions on Agreement and Service Fees
As long the management assignor and management trustee do not agree to end the agreement before 75 days prior to
Renewal Upon Expiration
the expiration, agreement will automatically renew every five years.
Management services fee-

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

16

revision
By written notice before 60 days prior to termination, both the management assignor and management trustee may
Other Special Matters

terminate agreement for any reason at any time.
The management assignor shall pay USD 250,000 as initial costs to the management trustee.

Overview of Building Conditions Survey ReportCompany Conducting

EBI Consulting
Date of Report

June 1, 2018 and June 11, 2018

Replacement Price-

Date of Report

June 2018

SurveyShort term Repair Costs
USD 3,750(within 1 year)
Long term Repair Costs (inUSD 1,343,894
12 years)
Overview of PML reportCompany Conducting

Tokio Marine & Nichido Risk Consulting

SurveyCo., Ltd.,

Probable Maximum Loss
0.3%
(PML)
Area Characteristics
The target property is a resort hotel located near Seven Mile Beach, one of the popular resort destinations in Grand Cayman Island. This hotel isdesigned to cater to extended-stay guests, as not only this hotel is situated adjacent to a supermarket, but also all the guest rooms have a kitchenequipped with a full-sized refrigerator, two-burner gas range, microwave oven, toaster, coffee maker and cooking utensils. The hotel is expected to create
stable demand since it offers relatively affordable accommodation plans. The popularity of this hotel, operated as a sister resort hotel adjacent to theWestin, partly lies in its options allowing guests to use facilities and services of the Westin, including its private beach. Sunshine Resort also provides
amenities such as an open-air pool and highly-rated restaurants, while offering 131 guest rooms ranging from 25m2 to 37m2. As Owen Roberts
International Airport in Grand Cayman, at which expansion projects are under way, serves direct flights to and from major cities in North America, it isexpected that the number of tourists visiting the island will increase further.
Special Notes
Not applicable.
(Note 1)This price is not the anticipated acquisition price of the Cayman Hotel TK Interest acquired by INV but the anticipated acquisition price of theLeasehold, etc. of the Underlying Asset acquired by the Cayman SPC (Sunshine Suites Resort, including the adjacent land state in (Note 3)).

(Note 2)

Appraisal value of the unused land adjacent to Sunshine Suites Resort is included.

(Note 3)The vacant land adjacent to Sunshine Suites Resort (3.089 ac (approx. 12,500m2) is included. The sub-leasehold is created on the land of
10-feet wide running along the west boundary of the Underlying Asset from north to south to Meow Limited.

Sunshine Suites Resort
3. Income and Expenditures, Etc.
Operating Period

January 1, 2016 – December 31, 2016

January 1, 2017 – December 31, 2017

4,574,565

4,610,349

a. Rent Expense――b. Taxes and Public Dues――c. Non-life Insurance Premiums

532,335

432,759

d. Other expense

165,620

30,765

GOP (= (1) - (2)) (Note 1)

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

17

NOI (= GOP - [a. + b. + c. + d.])3,876,610

4,146,825(1) Sales

10,081,005

10,133,108

Room Income

6,323,277

6,400,319

Other Income

3,757,728

3,732,789

5,506,440

5,522,759

ADR

174.04172.28

RevPAR

132.89133.86

Room Occupancy Rates

76.4%

77.7%

GOP Ratio

45.4%

45.5%

(2) Operating Costs (not including a. through(Referd. above)ence)(Note 1) Revenue from the leasing business is described assuming that the Cayman SPC owned the hotel property based on information provided by thecurrent property owner.

Sunshine Suites Resort
Summary of Real Estate Appraisal Report
Appraisal Method

Local appraisal verification method(Note 1)

Appraising Organization

CBRE K.K.

Local Appraising Agency

CBRE, Inc

Appraisal Value (Specified Value)

USD 50,200,000

Time of Valuation

May 24, 2018

(Note 1)

Under the method of “Local appraisal verification method,” a real estate appraiser licensed in Japan determines appraisal value based on
the understanding and analyses of basic data and information necessary for real estate appraisal, including appraisal methods employedby local appraisers, and transaction examples and trends in local markets that are used for real estate appraisal, and by verifying thevalidity of decisions made in appraisal reports and appropriateness of appraisal value prepared by local appraisers. INV appoints CBRE,
Inc., a professional appraiser licensed and certified in the Cayman Islands, as a local appraiser to make it engage in appraisal of the Assetand prepare a local appraisal report. And then INV makes CBRE K.K., a company appointed as a real estate appraiser in Japan, verify the
local appraisal report and then obtains a report on verification of appraisal performed by local appraiser. While any acquisition of a tokumei
kumiai interest does not need to obtain a real estate appraisal report based on Article 201-1 of the Act on Investment Trusts andInvestment Corporations and Article 122-2 of the Order for Enforcement of the Act on Investment Trusts and Investment Corporations, INV
obtains a real estate appraisal report (a report on verification of appraisal performed by local appraiser) as is the case in an acquisition oftrust beneficiary interest, given the fact that the Underlying Asset of the Cayman Hotel TK Interest is the Leasehold(Note 2)

The appraisal value includes an appraisal value of the adjacent vacant land of USD 5,900,000.

Value of Profits using the Profit Capitalization Method (USD)(1) Direct Capitalization Method(a) Hotel Operating Profit①Operating Revenue

Contents

Overview

4,738,065
4,738,065(b) Non-life Insurance Premiums

524,055(c) FF&E Reserve448,321(d) Other Costs②Operating Costs (Expense Rate)=[(b)＋(c)＋(d)]GOP972,376

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

18

③Net Operating Income＝[①－②]3,765,689④Capitalization Yield

8.5%⑤Income Price using Direct Capitalization Method
44,000,000＝[③÷④](2) DCF Method

Contents

Overview① Total of Current Value of Net Income during
24,545,932
Analysis Period(a) Sale Price

57,796,760(b) Sale Costs

1,155,935(c) Returning Price＝[(a)－(b)]56,640,825②Returning Price, Current Value

19,948,019③Discount Rate

11.00%④Final Capitalization Yield

8.75%⑤Income Price using DCF Method＝[①＋②]44,500,000(3) Income Price using Income Capitalization
44,300,000
MethodOther Points to be Noted for Appraisal by Apprising Organization
Verified and confirmed local basic materials and local appraisal report and confirmed appropriateness and that it has no issues.

(3)

Matters relating to Seismic Resistance etc. for the Underlying Assets
With respect to the Underlying Asset, INV has obtained an opinion from third-party experts, EBI
Consulting and Tokio Marine & Nichido Risk Consulting Co., Ltd. According to the report, the probablemaximum loss at properties due to an earthquake, or PML, of the Westin is 0.6% and of the Sunshine
Resort is 0.3%.
(Note)The due diligence conducted includes examination of appraisal values, building inspection, seismic risk inspection andlegal due diligence, etc.

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

19

4.

Overview of TK operator
The overview of the TK operator is as follows.
(i)
(ii)

Name

(iii)

Title and name ofrepresentative officer
Business

Location

(iv)
(v)
(vi)
(vii)
(viii)(ix)

CapitalUSD 50,000
Date of establishment
June 29, 2018
Net assets
USD 339,836 thousand (JPY 37,382 million) (Note)
Total assets
USD 339,836 thousand (JPY 37,382 million) (Note)
Relationship between INV/Asset Manager and the Seller
There are no capital relationships that should be noted between
INV/CIM and the TK operator. Further, there are no capital relationships
Capital relationshipsthat should be noted between the related parties or affiliates of INV/CIM
and the related parties or associated companies of the TK operator.
There are no personal relationships that should be noted between
INV/CIM and the TK operator. Further, there are no personal
Personal relationships
relationships that should be noted between the related parties or
associated companies of INV/CIM and the related parties or affiliates of
the TK operator.
There are no transactional relationships that should be noted between
INV/CIM and the TK operator. Further, there are no transactional
Transactional
relationships that should be noted between the related parties orrelationships
associated companies of INV/CIM and the related parties or affiliates of
the TK operator. A Fortress affiliate is expected to act as the asset
advisor for the TK operator.
The TK operator is not a related party of INV or CIM. Further, related
Whether the TK is apersons and affiliates of the TK operator are not related parties of INV
related party
or CIM. Furthermore, the TK operator is not an interested party, etc. of
CIM as provided in the Investment Trust Act.

(Note)

5.

Seven Mile Resort Holdings Ltd.
Walkers Corporate Limited, Cayman Corporate Centre, 27 Hospital
Road, George Town, Grand Cayman KY1-9008,Cayman Islands
Michael Roger Priaulx, Director
Jonathan Paul Drake, Director
Real Estate

Information scheduled as of October 31, 2018.

Transactions with Interested Persons etc.
Upon the acquisition of the Cayman Hotel TK Interest and the series of the other related transactions,
INV will acquire the TK interest in the Cayman Holding SPC. However, these transactions do not fallunder the related party transactions described in the voluntary rules established by CIM as
countermeasures against conflicts of interests in the management of INV’s investment. Further, eachseller of the Underlying Assets to the TK operator is not a Sponsor-related Person (Note). However, thecurrent owners of the Underlying Assets have received investments through funds managed by affiliatesof FIG (FIG is considered a Sponsor-related Person as it is a subsidiary of SoftBank Group, which
directly and indirectly holds 100% of CIM’s outstanding shares), and taking into consideration that the
Cayman Holding SPC into which INV is making a TK investment will acquire the Underlying Assets fromsuch owners, and that an affiliate of FIG is expected to be Cayman SPC’s advisor, CIM has treated such
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

20series of transactions as equivalent to the transactions with Sponsor-related Persons.
For the acquisition of the Cayman Hotel TK Interest and a series of relevant transactions, INV shallconfirm in accordance with the Regulations on the Transactions with Sponsor-related Persons and theManual for Management of the Transactions with Sponsor-related Persons, which are CIM’s internal
rules, that the acquisition price of overseas assets to be paid by the Cayman Holding SPC shall not
exceed total amount Underlying Assets appraisal value. Following deliberation and determination at theInvestment Committee of CIM and the Compliance Committee of CIM held on July 17, 2018, meetings ofthe boards of directors of CIM and INV were held on the same day and each board approved suchtransactions.
(Note)A Sponsor-related Person is (i) any person who falls under the “Interested Persons, etc.” set forth in the Investment Trust
Act and the Enforcement Order of the Investment Trust Act (Cabinet order No. 480 of 2000, as amended), (ii) all
shareholders of CIM and (iii) special purpose companies (tokubetsu mokuteki kaisha) (a) which delegate their
management to persons who fall under (ii) above, or (b) which are invested in by or through anonymous partnerships(tokumei kumiai) by persons who fall under (ii) above.

6. Summary of the issuer of the Cayman Hotel TK Interest
The issuer of the Cayman Hotel TK Interest (the Cayman SPC) is an entity having no special conflict ofinterests with INV or CIM. The outline of the seller of the Underlying Asset which the Cayman SPC will
acquire is as follows.
(i) company name/personal name, (ii) relationship with a person having special conflict of interests, (iii)background and purpose of acquisition, (iv) acquisition price and (v) date of acquisition
Name of Property

Current Owner/Holderof Trust BeneficiaryInterest

Former Owner/Holderof Trust BeneficiaryInterest
Name of Property

Current Owner/Holderof Trust BeneficiaryInterest

Former Owner/Holderof Trust BeneficiaryInterest

Westin Grand Cayman Seven Mile Beach Resort & Spa(i) CF GC Hotel Sub Ltd.
(ii)This company has received investments through a fund managed by anaffiliate of FIG which is the subsidiary of SoftBank Group(iii) Acquired the asset for investment management purpose.
(iv) As the seller has owned the asset for over one year, we omitted theacquisition price.
(v) March 2016
Person having no special conflict of interests

Sunshine Suites Resort(i) CF GC Sunshine Ltd. (land and building), CF GC Sunshine Land Ltd.
(vacant land adjacent to the hotel property)(ii)This company has received investments through a fund managed by anaffiliate of FIG which is the subsidiary of SoftBank Group(iii) Acquired the asset for investment management purpose.
(iv) As the seller has owned the asset for over one year, we omitted theacquisition price.
(v) September 2015 (land and building), October 2015 (vacant land
adjacent to the hotel property)
Person having no special conflict of interests

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

21Summary of the seller of the Underlying Assets
Westin Grand Cayman Seven Mile Beach Resort & Spa
(i)
(ii)

Name

(iii)

Title and name ofrepresentative officer
Business

Location

(iv)
(v)
(vi)
(vii)
(viii)(ix)

CF GC Hotel Sub Ltd.
PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman
Islands
Constantine M.Dakolias, Director
Unrestricted

CapitalUSD 50,000
Date of establishment
June 24, 2015
Net assets
Not disclosed (Note)
Total assets
Not disclosed (Note)
Relationship between INV/Asset Manager and the Seller
There are no capital relationships that should be noted between
INV/CIM and the TK operator. Further, there are no capital relationships
Capital relationshipsthat should be noted between the related parties or affiliates of INV/CIM
and the related parties or associated companies of the TK operator.
While there are no personal relationships that should be noted between
INV/CIM and the TK operator, as of July 17, 2018, among the directorsof INV and the officers and employees of CIM, Naoki Fukuda, who is
Executive Director of INV and CEO of CIM, is seconded from Calliope.
Personal relationships
Furthermore, a part-time director of CIM, Christopher Reed, isseconded from Fortress Investment Group Japan Godo Kaisha, asubsidiary of FIG.
There are no transactional relationships that should be noted between
INV/CIM and the TK operator. Further, there are no transactional
Transactional
relationships that should be noted between the related parties orrelationships
associated companies of INV/CIM and the related parties or affiliates of
the TK operator. A Fortress affiliate is expected to act as the asset
advisor for the TK operator.
The TK operator is not a related party of INV or CIM. Further, related
Whether the TK operator persons and affiliates of the TK operator are not related parties of INV
is a related party
or CIM. Furthermore, the TK operator is not an interested party, etc. of
CIM as provided in the Investment Trust Act.

(Note)

Not disclosed because consent from the seller has not been obtained.

Sunshine Suites Resort(Land and building)
(i)
(ii)
(iii)

Name
Location(iv)

Title and name ofrepresentative officer
Business

(v)
(vi)
(vii)

CapitalDate of establishment
Net assets

CF GC Sunshine Ltd.
PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman
Islands
MaplesFS Directors Limited, Director
Unrestricted
USD 50,000
August 7, 2015
Not disclosed (Note)

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

22

(viii)(ix)

Total assets
Not disclosed (Note)
Relationship between INV/Asset Manager and the Seller
There are no capital relationships that should be noted between
INV/CIM and the TK operator. Further, there are no capital relationships
Capital relationshipsthat should be noted between the related parties or affiliates of INV/CIM
and the related parties or associated companies of the TK operator.
While there are no personal relationships that should be noted between
INV/CIM and the TK operator, as of July 17, 2018, among the directorsof INV and the officers and employees of CIM, Naoki Fukuda, who is
Executive Director of INV and CEO of CIM, is seconded from Calliope.
Personal relationships
Furthermore, a part-time director of CIM, Christopher Reed, isseconded from Fortress Investment Group Japan Godo Kaisha, asubsidiary of FIG.
There are no transactional relationships that should be noted between
INV/CIM and the TK operator. Further, there are no transactional
Transactional
relationships that should be noted between the related parties orrelationships
associated companies of INV/CIM and the related parties or affiliates of
the TK operator. A Fortress affiliate is expected to act as the asset
advisor for the TK operator.
The TK operator is not a related party of INV or CIM. Further, related
Whether the TK operator persons and affiliates of the TK operator are not related parties of INV
is a related party
or CIM. Furthermore, the TK operator is not an interested party, etc. of
CIM as provided in the Investment Trust Act.

(Note)

Not disclosed because consent from the seller has not been obtained.

(Vacant land adjacent to the hotel property)
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)(ix)

Name
Location
Title and name ofrepresentative officer
Business

CF GC Sunshine Land Ltd.
PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman
Islands
Constantine M.Dakolias, Director
Unrestricted

CapitalUSD 50,000
Date of establishment
October 14, 2015
Net assets
Not disclosed (Note)
Total assets
Not disclosed (Note)
Relationship between INV/Asset Manager and the Seller
There are no capital relationships that should be noted between
INV/CIM and the TK operator. Further, there are no capital relationships
Capital relationshipsthat should be noted between the related parties or affiliates of INV/CIM
and the related parties or associated companies of the TK operator.
While there are no personal relationships that should be noted between
INV/CIM and the TK operator, as of July 17, 2018, among the directorsof INV and the officers and employees of CIM, Naoki Fukuda, who is
Executive Director of INV and CEO of CIM, is seconded from Calliope.
Personal relationships
Furthermore, a part-time director of CIM, Christopher Reed, isseconded from Fortress Investment Group Japan Godo Kaisha, asubsidiary of FIG.
Transactional

There are no transactional relationships that should be noted between

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

23relationships

Whether the TK operator
is a related party(Note)

INV/CIM and the TK operator. Further, there are no transactional
relationships that should be noted between the related parties or
associated companies of INV/CIM and the related parties or affiliates of
the TK operator. A Fortress affiliate is expected to act as the asset
advisor for the TK operator.
The TK operator is not a related party of INV or CIM. Further, related
persons and affiliates of the TK operator are not related parties of INV
or CIM. Furthermore, the TK operator is not an interested party, etc. of
CIM as provided in the Investment Trust Act.

Not disclosed because consent from the seller has not been obtained.

7. Overview of Brokerage
Not applicable.
8. Overview of Scheme(1) Overview of Scheme(Note 1) ISH stands for ippan shadan hojin which is a general incorporated association established according to the Act onGeneral Incorporated Associations and General Incorporated Foundations and is characterized mainly by no
distribution of its profit to its members. In the above scheme, CI Holdings ISH will hold 100% common shares of Seven
Mile Resort Holdings Ltd. and Seven Mile Resort Management Ltd. for the purpose of bankruptcy remoteness.

(2) Overview of Taxation
The Cayman Islands are a tax-efficient jurisdiction, with no tax on income or capital gains and no
personal income tax or property tax. Most of the income derived by the government of the Cayman
Islands is generated by indirect taxes, taxes on imported goods or by stamp duties. Stamp duty will be
due on acquisition of the Leasehold by the Cayman SPC.
9. Foreign Currency Exchange Risk Hedge Size and Hedge Ratio Considerations
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

24(1) Foreign currency exchange risk hedge size and hedge ratio when investing in the Cayman Hotel TK
Interest
INV will acquire the Cayman Hotel TK Interest on a US Dollar-denominated basis one business day
prior to the date of sale and purchase of the Underlying Assets, the deadline of which is set on October
31, 2018. INV plans to hedge foreign currency fluctuation risks by acquiring put options for all amounts
to be invested for the acquisition until INV actually invests in the Cayman Hotel TK Interest. Details ofsuch option trading will be announced separately as soon as determined.
(2) Foreign Currency Exchange Risk Hedge Size and Hedge Ratio when Receiving Profit/loss Distributions
from Cayman Hotel TK Interest
INV will explore potential strategy of hedging foreign currency fluctuation risks through currency option
trading or other appropriate methods during an accounting period (six (6) months) or two accounting
periods (one (1) year) of INV respectively, based on the estimates of profit/loss distributions received
from and cash flow of the Cayman Hotel TK Interest, etc.

10. Schedules
Acquisition decision date:
Agreement execution date:
Anticipated acquisition date:

Anticipated source of acquisition funds:
Anticipated acquisition proceeds payment
method:(Note 1)

(Note 2)

July 17, 2018
One business day prior to the acquisition date of theunderlying assets, which will be closed by October 31,
2018 or the date separately agreed (Note 1)
Funds from the Offerings (Note 2), new borrowings andcash-on-handLump-sum payment (Note 1)

The anticipated acquisition date of the acquisition of the Underlying Asset by the Cayman SPC is one business day
prior to the date when the Cayman SPC (TK operator) acquires the underlying assets, the deadline of which is
October 31, 2018 or an earlier date which will be agreed upon with the sellers (i.e., the acquisition will be closed assoon as practicable after the condition precedent under the purchase and sale agreement such as the relevant
SPC has obtained Cayman Islands consents from Cayman Islands Government and other regulatory approval forthe acquisition and certain required permits has been met).
For details of the issuance of new investment units, Offerings, please refer to “Notice concerning Issuance of New
Investment Units and Secondary Distribution of Investment Units”, for detail of new borrowings, please refer to “Noticeconcerning Debt Financing” announced on July 17, 2018.

11. Matters concerning Forward Commitment, Etc.
INV concluded the TK Agreement on the Cayman Hotel TK Interest as of July 17, 2018, and will make TK
investment based on such TK Agreement prior to the Cayman SPC’s acquisition of the Two Overseas
Hotel Assets (which is scheduled by October 31, 2018 or the date separately agreed; however, theCayman SPC will execute such acquisition promptly when all the conditions for sale and purchase are
fulfilled). The sale and purchase agreement on the Cayman SPC’s acquisition of the Two Overseas Hotel
Assets is subject to the conditions that INV completes fundraising for such TK investment via the Offeringor new borrowings, and all approvals and licenses necessary for the acquisition and operation of the Two
Overseas Hotel Assets are obtained. If any of such conditions is not fulfilled, INV shall not be required tomake such TK investment.
This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

2512. Future Outlook
For information on the revision of INV’s forecasts for financial results and distribution for the fiscal period
ending December 2018 (from July 1, 2018 to December 31, 2018) in connection with the Acquisition of
Cayman Hotel TK Interest, please refer to “Notice concerning Revision of Forecast of Financial Resultsand Distribution for the 30th Fiscal Period Ended June 2018 and 31st Fiscal Period Ending December
2018” dated as of July 17, 2018.
13. Other Matters that are Necessary for Investors to Properly Understand and Make Judgment on Relevant
Information
With respect to the risks associated with the acquisition of the Cayman Hotel TK Interest, please refer tothe content of “Investment Risks” stated in the semi-annual securities report (yuka shoken hokokusho) of
INV for the fiscal period ended December 2017 (from July 1, 2017 to December 31, 2017) (available inJapanese only) filed on March 26, 2018 and “Part II, Reference Information II Supplemental Information
to the Reference Documents 5 Investment Risks” in the securities registration statement (available inJapanese only) filed on July 17, 2018.

Website of INV: http://www.invincible-inv.co.jp/eng

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

26

(Appendix)
Photos and Maps of the Underlying Assets
Westin Grand Cayman Seven Mile Beach Resort & Spa

Sunshine Suites Resort

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

27

Map and Direct Flight Access to the Cayman Islands from Major Cities(Source) Prepared by CIM based on data provided by Cayman Islands Tourism Association

This English language notice is a translation of the Japanese-language notice released on July 17, 2018 and was prepared solely for the convenience of, and referenceby, non-Japanese investors. It is not intended as an inducement or solicitation for investment. We caution readers to undertake investment decisions based on their own
investigation and responsibility. This translation of the original Japanese-language notice is provided for informational purposes only, and no warranties or assurances are
given regarding the accuracy or completeness of this English translation. Readers are advised to read the original Japanese-language notice. In the event of any
discrepancy between this translation and the Japanese original, the latter shall prevail in all respects.

28