NOMURA RESIDENTIAL FUND
3240

12th Fiscal Period
Ended November 30, 2012)

Analyst Meeting Presentation Material

January 17, 2013

Contents
1. Highlights of the 12th Fiscal Period

・12th FP Financial Statement Overview
・12th FP Performance

4. Details of the Financial Results
23

2. Fund Management Summary

・Rental Housing Investment Characteristics
・Characteristics of NRF
・Priority Investment in Key Segments
Priority Investment in Key Segments
・Measures for Increasing Property Competitiveness

17
18
19

6
7
8
9
10

3. Fund Management Results

・Portfolio Occupancy Rate・Changes in Leased Units and Rent Level
・Financial Status

16

5

and Occupancy Rate

・Strategy for Replacing Properties
・Management Strategies

・Income statement
・Balance Sheet・Forecasts for the 13th Fiscal Period
・Unitholders

12
13
14

APPENDIX

・Changes in Asset Size
・Portfolio Status
・Appraisal Value Status
・Changes in Revenue
・Changes in Investment Unit Price and Cash Distribution
・Portfolio Map
・Portfolio
・Changes in Financial Performance・Interest-bearing Debts
・Fund Profile
・Asset Management Company Overview

21
22
23
24
25
26
27-31

January 17, 2013

32
33
34
35

Highlights of the 12th Fiscal Period

112th Fiscal Period (ended Nov. 30, 2012) Financial Statement Overview
Financial Statement Overview
13th FP Forecasts(ended May 31, 2013)

11th Fiscal Period(ended May 31, 2012)

12th Fiscal Period(ended Nov. 30, 2012)

Difference(previous period)¥5,250 million¥5,174 million- 1.4 ％（ Forecast ）Operating Revenues¥2,507 million¥2,452 million- 2.2 ％（ Forecast ）Operating Profits¥1,856 million¥1,875 million+ 1.0 ％（ Forecast ）Net Income
Cash Distribution Per Unit

¥12,302 million¥12,424 million+ 1.0 ％

Difference to12th FP Results+ 0.6 ％

¥5,206 million- 2.3 ％

¥2,395 million- 2.6 ％

¥1,826 million（ Forecast ）- 2.6 ％

¥12,100 million（ Forecast Announced on Jul. 2012 : ¥12,300/unit ）Difference in Cash Distribution(yen/unit)

13,000+ ¥213¥12,302+ ¥246-￥500- ¥610¥12,424¥12,100+ ¥376+ ¥73(Forecast)

12,000・ Expenses on・ Rent and・ Revenues from
Common -area Fees Commission Fees, etc. Commission Fee, etc.
+ ¥311- ¥011- ¥168●・ Repair and・ Key Money and・ Interest Expense &Maintenance
Renewal Fees
Loan-related Fee, etc.
+ ¥202- ¥356+ ¥375

11,000・ Non-rental
Revenues,etc.
- ¥133 ●・ Management
Fees, etc.
- ¥137 ●ProfitCost

・ Other・ Expenses on・ Rent and・ Revenues from
Common-area Fees
Commission Fees, etc. Commission Fee, etc.
- ¥284+ ¥088+ ¥152●・ Repair and・ Key Money and・ Interest Expense &Maintenance
Renewal Fees
Loan-related Fee, etc.
- ¥456+ ¥125+ ¥387・ Management
Fees, etc.
+ ¥130 ●+ ¥137 ●・ Other- ¥166 ●10,00011th FPCash Distribution

Other

12th FPCash Distribution

Profit

Cost

Other

13th FPCash Distribution※ Cash distribution per unit for the 13th fiscal period (ending May 2013) shown in the chart is the forecast as of January 15, 2013. Actual figures may change due to the acquisition or sales of properties, changes in real estatemarkets, and other conditions surrounding NRF. NRF does not guarantee the cash distribution per unit predicted in this forecast.

2

12th Fiscal Period Performance
Management

Acquisition

Finance Refinancing approx. ¥12.5 billion

 Continuing replacement of properties Maintain high occupancy rate
[ Occupancy Rate ]（End-11th FP : 96.2％ → End-12th FP：96.2％

14

100

95

95.7

96.0

95.4

95.8

96.2

95.8

Bonds

¥12.5

1.12 ％

12→

1.03 ％

10890Acquisition

¥3.1
¥5.4

6

Disposition

¥3.9

4

85

2

[12th Acquisition]

0

URBAN STAGE Koganei Honcho （Koganei-shi, Tokyo）

80
Jun.

Jul.

Refinance

16

Total Portfolio

（％）

Debt

(billions of yen)

Aug.

Sep.

Oct.

Nov.

・Acquisition Price : ¥725 million: 6.1 ％・NOI Yield

12th
FP

・Acquisition Date : Jun. 8, 2012
: 7.9 years※
・Building Age・Increasing Nomura Living Support Co., Ltd. (NLS)
share of the property management.

・Expanding asset value

・Increasing property competitiveness through renovation

・Improving portfolio quality

13th
FP

14th
FP

15th
FP

16th
FP

17th
FP

18th
FP

19th
FP

20th
FP

21st 22nd 23rd
FP
FP
FP

・Lower interest costs
・Diversification of repayment date・Elongation/fixation of debt financing（11th FP）

（12th FP）

96.5％

→

95.8％

Greater Tokyo Area 96.1％→→

Total Portfolio

Other Areas

97.3％[ Portfolio at Nov, 30. 2012]（ - 0.7pt）（11th FP） （12th FP）

Asset Size

¥150.58 billion

94.9％ （ - 1.2pt）

Portfolio NOI Yield

00005.3 %

97.7％ （＋0.4pt）

Building Age

00009.5 years

Maintain High Occupancy Rate ＋

Replacing Properties

Weighted Average Interest Rate

1.28％ →

1.27％ （- 0.01pt）

LTV Level

53.1％ →

53.0％ （- 00.1pt）＋

RefinanceContinuing Stable Cash Distribution※Building Age at time of acquisition is stated.

3

Fund Management Summary4

Rental Housing Investment Characteristics
Changes in Rent Index by Purpose [Nationwide]
Offices

Housing

StoresHotelsWarehouses

130
120
110
100
90
80
1990

1993

1996

1999

2002

2005

2008

2011

Source: Created by NREAM based on the Ministry of Internal Affairs and Communications “Consumer Price Index Annual Report (1990-2011)” and the Bank of Japan “Service Price Index for Companies (1990-2011)”* The line graph shows the index of each year with 1990 set as 100.

Changes in Rent and Occupancy Rate (Properties owned by NRF・Rental housing owned by all J-REITs）
 Changes in Rent Index

 Changes in Occupancy Rate

[Tokyo’s 23 Wards]

Rental Housing Owned by J-REITs

Properties Owned by NRF

100

100.0

102.7

100.0

99.0

100.9

104.0

100.3

99.6

100.3

100.6

99.0

96.4

100.6

92.8

99.7

90.5

96.6

90.2

80

99.2

96.6

88.8

90.3

[Nationwide]
Rental Housing Owned by J-REITs

Properties Owned by NRF（％）

Average of Properties Owned by NRF 95.1%

100

90

Average of Rental Housing Owned by J-REITs 94.2%

60

80

40

70

1st FP

3rd FP

5th FP

7th FP

9th FP

11th FP

1st FP

3rd FP

5th FP

7th FP

9th FP

11th FP(May 31, 2007)(May 31, 2008)(May 31, 2009)(May 31, 2010)(May 31, 2011)(May 31, 2012)(May 31, 2007)(May 31, 2008)(May 31, 2009)(May 31, 2010)(May 31, 2011)(May 31, 2012)

Source: Created by NREAM based on the Association for Real Estate Securitization (ARES) “ARES Japan Property Index (AJPI).”
Source: Number of rental housing units owned by J-REITs at the end of May 2012 is based on a flash reportand may differ from actual figures updated later.
* Index of each period is calculated with the average rent at the end of May 2007 set as 100.

Source: Created by NREAM based on statistical data provided by ARES.

Properties owned by NRF show remain stable changes in both rent index and occupancy rate compared with rental housing owned by J-REITs.

5

Characteristics of NRF
Structure for Generating Stable Profit

Priority Investment in Core Units

Foundation for
Stable Profit
Highly-effective Property Management

Stable Financial Foundation

 Priority Investment in Core Units： Units with rents ¥150,000 or less, and areas under 50sqm

 Highly-effective Property Management： Taking measures for increasing property competitivenessand occupancy rate Stable Financial Foundation： Maintaining conservative financial policy

6

Priority Investment in Key Segments
Investment in the segments with high demand for rental properties
 Changes in Number of Households (“Total ””Singles””DINKs”)

 Relative Frequency Distribution of Number of Households by Income[Greater Tokyo Area](Thousand Households)(％)

16,00014,91815,414

15,253200

15,415Singles/
DINKs 160
(158%)

13,157140
Total
Number ofHouseholds(124%) 120

Over 50% of the total
number of households

12,318Main target tenant classes⇒Annual Income ¥4 million～¥9 million（ approx. 50% of total household）

180

13,757

14,000（％）
16

15,268Peak of Numberof Households

12,000[Nationwide]

12

8

4

100

10,000

80

1995

2000

2005

2010

2015

2020

2025

0

2030

Source: Created by NREAM based on the National Institute of Population and Social Security Research (IPSS) “Number of Households by Family Type,
Source: Age (five-year groups), and Sex group.”* The line graph shows changes in number of single or couple-only households and total number of households with 1995 set as 100.

Core Units(rent ¥150,000 or less, floor area under 50 sqm)

Aｔ 12th Fiscal Period End

Core Units
Unit Ratio(Occupancy Rate
Characteristics

：
：

Low
Rent

87.8 %

96.0 %)

7,796 units

Units with rent ¥150,000 or less and floor area under 50 sqm

Unit Ratio(Occupancy Rate
Characteristics
Number of subject
housing units：： Changes in Occupancy Rate of Core Units（％）： Single/DINKs units
in Greater Tokyo Area

Number of subject
housing units（income）

Source: The Ministry of Health, Labour and Welfare (MHLW) “Overview of National Livelihood Survey 2011”

6.6 %95.6 %)： Family unitsin Major Regional Cities

582 units

Small
Area
Unit Ratio(Occupancy Rate
Characteristics

：
：

96.9

96.2

96.4

96.4

94.4

93.6

95.8

96.5

96.3

96.7

96.7

9th FPEnd

10th FP 11th FP 12th FP
End
End
End

96.0

： Expensive units
in Central Tokyo

273 units

Number of subject
housing units¥150,000
50 sq. meters
Unit Ratio：(Occupancy Rate
Characteristics

：

Large
Area Number of subject

100

3.1 %
98.6 %)

80

Average 96.0 ％

High
Rent

2.5 %
96.5 %)

60： Family units
in Central Tokyo/Suburbs

housing units

225 units
40
1st FPEnd* Figures do not include data on stores.

(For reference) Total NRF portfolio
・Average Rent Per Unit

approx. ¥95 thousand

・Leasable Units

2nd FPEnd

3rd FPEnd

4th FPEnd

5th FPEnd

6th FPEnd

7th FPEnd

8th FP
End

8,917 units

・Average Leasable Floor Area Per Unit approx. 29 sqm

7Measures for Increasing Property Competitiveness and Occupancy Rate
Major remodelingApproaches to increase customer satisfaction

 Remodeling to meet tenant needs

 Providing services for tenants in properties managed by NLS.
Subject properties: 66 (as of January 17, 2013)

Changing tenant floor plans to meet market needs
URBAN STAGE Kamiuma

Rent ： ¥124 thousand/month¥143 thousand/month(Increased approx. 15%)After Renewal

Before Renewal

Tenants Services

 Free disaster kit & guidebook * Started distribution from late January.

LDK unit renovation
to increase space

・To prepare for natural and other disasters

Renovating waterand related equipment

 Home-visit consultation for tenants * Started distribution from late January.
・Routine home-visit consultation one week after move-in

Increasing sophistication (remodeled common areas) 24-hour emergency customer service

URBAN STAGE Chitose Karasuyama
After Renewal

Before Renewal

・Emergency services: Respond to troubles related to water and windows 24hours per day
・Repair services: Respond to electrical and gas equipment

Changing walls
and door frames

 Special tenant benefits
・Access to hotels, leisure facilities, restaurants, etc. in Japan at member prices

8Strategy for Replacing Properties
MarketAcquiring prime properties

×

NRF
Reduced relative competitiveness in a some of properties

Promoting property replacement

Acquisition•Low Management Efficiency•High Building Age•High Yield•Low Building Age＜Results＞
Number of Properties
Property Price＜Results＞

6 Properties¥5.9 Billion yen

6.4 ％Average Building Age 4.0 Years
Average NOI Yield

Portfolio at 12th Fiscal Period End※1

US Kasai East

US Yoga*1: The average NOI yield is weighted by property price.
*2: The average building age is weighted by property price.

※3

153 Properties
Property Price ¥150.5 Billion yen

Number of Properties※2

Average Building Age

US Tamatasukuri US Kamimaezu

4 Properties¥1.8 Billion yen
Property Price
4.8 ％Average NOI Yield
Average Building Age14.9 Years
Number of Properties

Average NOI Yield

US Koganei
HonchoDisposition

US Itabashi
Kuyakushomae

※4

5.3 ％
9.5 Years
US Minami Urawa

US Yono Hommachi

PU Ebisu Minami

US Tennocho*3: The average NOI yield is weighted by property price.
*4: The average building age is weighted by property price.

Improving the quality and profitability of portfolios

9Management Strategies
Management

Acquisition

Finance

Rental Market

Real Estate investment Market

Financial Market

 Reducing supply of new rental properties

Enhancing portfolio profitability

 Renovating properties and providing
other services to tenants Increasing property transactions

Improving portfolio quality

 Promoting property replacement

 Low rate of interest due to a continuing
policy of monetary easing

Improving borrowing conditions

 Refinancing 7.1 billion yen in total→ Improving lease conditions→Selling properties that are aged, or whose
profitability is lowered→Lower interest costs→Increasing rent for new tenants during thefrequent replacement season→Acquiring properties considering NOI yield→Longer duration

Maintaining a stable level of cash distribution

10

Fund Management Results

11Portfolio Occupancy Rate（％）

Total Portfolio

Greater Tokyo Area

Other Area

100

95

90

85

11th Fiscal Period

12th Fiscal Period

Average: 96.5%

Average: 95.8%

80
Area

…
Dec.
2011

2012年…
Jan.

…
Feb.

…
Mar.

…
Apr.

…
May

…
Jun.

…
Jul.

…
Aug.

…
Sep.

…
Oct.

…
Nov.

Portfolio

96.0%

96.2%

96.6%

97.0%

96.7%

96.2%

95.7%

96.0%

95.4%

95.8%

95.8%

96.2%

Greater Tokyo Area

96.1%

96.1%

96.4%

96.3%

96.0%

95.5%

94.7%

94.9%

94.4%

94.7%

94.9%

95.7%

Other Area

95.9%

96.3%

97.2%

98.4%

98.1%

97.7%

97.7%

98.4%

97.7%

98.0%

97.7%

97.0%

Leasable Floor Area

79,379 tsubo

79,379 tsubo

79,245 tsubo

79,035 tsubo

79,035 tsubo

79,035 tsubo

79,521 tsubo

79,521 tsubo

79,521 tsubo

79,521 tsubo

79,521 tsubo

79,521 tsubo

2012

12

Changes in Leased Units and Rent Level Rate of Change in Rent per Property
（％）

0.0
-0.02
-0.2

-0.19

-0.4
-0.50

-0.6

-0.8

Rent is Bottoming Out

-0.78

-1.0
9th FP End

10th FP End

11th FP End

12th FP End(May 31, 2011)(Nov. 30, 2011)(May 31, 2012)(Nov. 30, 2012)* Rate of change in rent per property is the comparison with the rent per property owned by NREAM at the end of the previous fiscal period.

 Rent change before move-out and after move-in Rent change at lease Renewals
（％）

1.0
100

（％）

Decreas 2.6

3.3

5.0

2.6

100
100%

53.0
Decrease 70.8

50
0.5

Flat

96.3

96.7

94.8

97.4

Flat

Increase

1.0
9th FP End(May 31, 2011)

10.6

Increase 18.6

0.0
10th FP End(Nov. 30, 2011)

0.2
11th FP End(May 31, 2012)

0.0
12th FP End(Nov. 30, 2012)

Reducing property
replacement bylowering rent

50
50%

16.5

0.00

49.9

64.8

11.1
24.1

15.3
Increasing property

30.5

34.7 replacement byraising rent00%

9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)13

Financial Status (12th Fiscal Period End)Interest-bearing Debt

Maturity Diversification（￥83,092 million

Interest-bearing Debt Total(millions of yen)
[Details]

20,000

Average Remaining Duration ofInterest-bearing Debt

2.6 years

Weighted Average Interest Rate

1.27 ％

Long-term Interest-bearing Debt Ratio

83.7 ％

AmountDate(millions of yen)Dec. 3, 2012

1,600

The Bank of Tokyo-Mitsubishi UFJ

OthersMay 23, 2013

5,500

Mizuho Corporate Bank

OthersLender

15,000Debt
Bonds

89.9 ％

9,790

9,290

10,0007,190

Fixed-rate Interest-bearing Debt Ratio

Repayment

10,530

9,790

7,790
6,660

6,362

6,350
5,420
3,920

5,000

53.0 ％

LTV Level*Investment Corporation Bonds are included in the “Interest-bearing Debt.”*Long-term Ratio, when including “long-term loans due within a year” in long-term loans, is 100.0%.
*“Loan Interest Rate Fixed Ratio” includes floating rate loans which have been fixed through interest rate swaps.

0
13th
FP

14th
FP

15th
FP

16th
FP

17th
FP

18th
FP

19th
FP
1st
Investment
Corporation
Bond

20th
FP

Lender Diversification (19 Lenders)Credit Rating

21st
FP
2nd
Investment
Corporation
Bond

22nd
FP

23rd
FP

(millions of yen)

AgencyRatingJCR

Long-term Senior Debt Ratins
Long-term Corporate Credit Ratins

Outlook
：
：

AA
A

S&P
Short-term Corporate Credit Ratins：

A-1

StableStableMajor Banks (4)Trust Banks (4)Regional Banks (4)The Bank of Tokyo-Mitsubishi UFJ

11,524 Mitsubishi UFJ Trust and Banking

11,524 The Iyo Bank

1,000

Sumitomo Mitsui Banking

11,524 The Sumitomo Trust and Banking

4,920 The Bank of Fukuoka

1,000

Mizuho Corporate Bank

6,620 The Nomura Trust and Banking

3,700 The Chiba Bank

750

Resona Bank, Limited

1,900 Mizuho Trust & Banking co., Ltd

1,000 The Tokyo Tomin Bank, Ltd.

500

Insurance Companies (4)Others (3)Taiyo Life Insurance

3,000 Development Bank of Japan

Mitsui Sumitomo Insurance

2,100 Aozora Bank

Daido Life Insurance

1,100 Shinkin Central BankThe Dai-ichi Life Insurance

800

7,910
500
1,720

Total borrowings

73,092

Investment Corporation bonds

10,000(Reference)

14

Details of the Financial Results

15

Income Statement

Operating Revenue
Real Estate Rental Business Revenues*1

Rental Business Revenues
Other Rental Business Revenues
Parking Lot Revenue*Reference [12th Fiscal Period]

11th Fiscal Period

12th Fiscal Period

Difference from

From Dec. 1, 2011

From Jun. 1, 2012

Previous Period

To May 31, 2012
Amount(￥000)
5,250,116

To Nov. 30, 2012
Amount(￥000)
5,174,635(12th FP - 11th FP)
Difference
Difference(￥000)
Ratio-75,481-1.4%

5,241,740

5,174,635-67,104-1.3%

4,834,854

4,833,156-1,6980.0%

406,885

341,479-65,406-16.1%

137,119

134,997-2,121-1.5%

1. Real Estate Rental Business Revenues: ¥3,042,737 thousand(from previous FP :¥-10,265 thousand)
2. Incidental Revenues
2. Key Money
2. Renewal Fee::¥50,887 thousand¥82,211 thousand

Incidental Revenue*2

202,518

148,721-53,797-26.6%

3. Other Real Estate Rental Revenues

Other Real Estate Rental Revenues*367,24757,759-9,487-14.1%

8,376－-8,376-100.0%3．Revenue from reversal of provision for loss on disaster,
cellphone antennae, vending machines, etc.

-0.8%Real Estate Disposition Revenue

2,743,049

2,721,882-21,166*1

2,188,737

2,131,898-56,839-2.6%

Repair Expenses*4

224,630

178,147-46,482-20.7%Tax and Public Dues

*5

233,821

256,024

22,202

9.5%

Depreciation and Amortization

963,023

967,546

4,523

0.5%

Other Rental Business Expenses

767,262

730,180-37,082-4.8%

365,310379,006

13,695

3.7%

189,001

210,978

21,977

11.6%

Operating Expense
Real Estate Rental Business Expenses

Asset Management Fees
Other Operating Expenses*6

Operating Profits

2,507,067

2,452,752-54,314-2.2%

Non-Operating Revenues

7,586

4,733

-2,852-37.6%

Non-Operating Expenses

657,109580,992-76,116-11.6%

Interest Expenses

518,259

477,313-40,945-7.9%

Investment Corporation Bond Interest

44,15655,708

11,551

26.2%

94,69347,970-46,722-49.3%

Ordinary Income

1,857,544

1,876,493

18,9491.0%

Net Income Before Tax

1,857,544

1,876,493

18,949

1.0%

702

1,223

520

74.1%

1,856,841

1,875,270

18,428

1.0%

50

77

26

53.0%

1,856,892

1,875,347

18,455

1.0%

Other Non-Operating Expenses

Corporate Income Tax, etc.
Net Income
Retained Earnings Brought Forw ard
Retained Earnings at Fiscal Period End*7

4. Renovation Expenses
4．Repair Expenses
4．Capital Expenditure
Total

:
:
:

¥178,147 thousand¥40,431 thousand¥218,578 thousand

5. Tax and Public Dues (153 properties at FP End)
5．Subject Property:
5．Excluded Property
:
Total
:

152 properties
1 properties
153 properties(estimate: ￥3,211 thousand/1 year)

6. Other Operating Expenses
6．Duty Entrustment Fee
6．Directors Fee, etc.

::

¥41,669 thousand¥5,600 thousand

7. Other Non-Operating Expenses
7．Loan Related Expense, etc.

:

¥36,805 thousand(Figures are rounded down to the nearest thousand)16Balance Sheet
Liabilities and Net Assets

AssetsCurrent Assets

12th Fiscal Period
as of Nov. 30, 2012

11th Fiscal Period
as of May 31, 2012

12th Fiscal Period
as of Nov. 30, 2012

Amount(￥000)

Amount(￥000)

Amount(￥000)

Amount(￥000)

Ratio
(%)

Ratio
(%)

6,596,180

4.2

6,646,820

4.2

Cash and Cash Equivalents

5,419,384

3.5

5,623,043

3.6

Cash and Cash Equivalent in Trust

1,058,705

0.7

939,396

0.6

Other Current Assets

118,090

Fixed Assets

150,122,975

0.1
95.8

84,380150,002,479

0.1
95.7

Current Liabilities
Trade Accounts Payable
Long-term Loan Due Within One Year＊

2

Other Accounts Payable

Ratio
(%)

Ratio
(%)

21,145,978

13.5

14,900,799

9.5

222,5500.1

203,2160.1

19,790,000

12.6

13,552,000

8.6

263,0190.2

305,480

0.2

605

0.0

12,7690.0

150,107,047

95.7

149,987,204

95.7

Taxes Payable

105,515,541

67.3

108,123,021

69.0

Accrued Expenses

182,3780.1

168,844

0.1

Building

52,533,366

33.5

53,028,525

33.8

Rent Received in Advance

682,094

0.4

656,1130.4

Land52,982,175

33.8

55,094,496

35.2

Deposits Payable

5,330

0.0

2,374

0.0

Real Estate in Trust

44,584,452

28.4

41,849,111

26.7

64,816,245

41.3

70,966,343

45.3

＊

Tangible Fixed Assets

1

Real Estate

Fixed Liabilities

Building in Trust

14,234,988

9.1

13,187,857

8.4

Investment Corporation Bonds＊

2

10,000,000

6.4

10,000,000

6.4Land in Trust

30,349,464

19.4

28,661,254

18.3

Long-term Loans＊

2

53,392,000

34.1

59,540,000

38.0

7,053

0.0

15,071

0.0

Security Deposits

935,0870.6

968,657

0.6

3,622

0.0

3,101

0.0

Security Deposits in Trust

489,158

0.3

457,685

0.3

3,622

0.0

3,101

0.0

Total Liabilities

85,962,224

54.8

85,867,142

54.8

Investment and Other Assets

12,3050.0

12,1730.0

Security Deposits

10,8790.0

10,8790.0

Construction in Progress
Intangible Fixed Assets
Other Intangible Fixed Assets

Long-term Repaid Expenses

1,426

Deferred Assets

61,282

Investment Corporation Bond Issuing Expenses

Total Assets*

11th Fiscal Period
as of May 31, 2012

1,294

0.0

0.0

54,5130.0

61,2820.0

54,5130.0

156,780,439

100.0

156,703,813

100.0(unit : million of yen)

1 Tangible Fixed Asset

Real Estate, etc.
Building
Land
Building in TrustLand in Trust
Construction in Progress

0.0

AcqisitionPrice

Accumulated
Depreciation(Depreciation for
current FP)

Book value
at FP end

158,559
58,99155,094
15,79728,661
15

8,572
5,962
－
2,609
－
－

(967)
(761)
－
(205)
－
－

149,987
53,02855,094
13,18728,661
15

Unitholders Equity

70,818,214

45.2

70,836,670

45.2

Unitholders Capital

68,961,322

44.0

68,961,322

44.0

Retained Earnings

1,856,892

1.2

1,875,347

1.2

Total Net Assets

70,818,214

45.2

70,836,670

45.2

Total Liabilities and Net Assets

156,780,439

100.0

156,703,813

100.0*2 Loans (long-term loans due whithin a year are included in the short-term loans)
Balance of interest-bearing debts (millions of yen)

83,092

Total asset interest-bearing debt ratio

Short-term loans+bonds＋Long-term loans
total assets

53.0％

Long-term interest-bearing debt ratio

Bonds＋Long-term loans
Short-term loans+bonds＋Long-term loans

83.7％

17

Forecasts for the 13th Fiscal Period
12th FP
From Jun. 1, 2012
To Nov. 30, 2012
Amount(millions of yen)
Operating Revenue

13th FP Forecast
From Dec. 1, 2012
To May 31, 2013
Amount(millions of yen)

Assumptions

Difference
Amount(millions of yen)

【Properties】
Number of Properties：

Total Amount of Acquisition Price：¥150,587 million：¥29 million

153 properties

5,174

5,206

32

5,174

5,206

32

2,721

2,811

89

2,131

2,223

92

Repair Expenses

178

231

53

Tax and Public Dues

256

258

2

Depreciation and Amortization

967

969

1

Asset Management Fees

379

374

-4

Other Operating Expenses

210

212

1

Operating Profits

2,452

2,395

-57

Non-Operating Profit and Loss

-576

-567

8

Example)US Komagome (unit renovation)：¥43 million

Interest Expenses

-533

-527

5

US Mukojima (lorge-scale renovation)：¥26 million

Ordinary Income

1,876

1,827

-48

Net Income

1,875

1,826

-48

：

¥83,092 million

Real Estate Rental Business Revenues
Operating Expense
Real Estate Rental Business Expenses【Repair Expenses 】\218 million for 12th Fiscal Period(\40 million of which is capital expenditure)
Example)Number of Investment Units Issued(units)150,936

150,936－

Cash Distribution Per Unit(yen)

12,424

12,100-324

Number of Properties(properties)

153

153

－

Leasable Floor Area(sqm)

262,882

262,882

－

(%)

95.8

95.7

-0.1

Average Occupancy Rate

US Chitose Karasuyama (lorge-scale renovation)\308 million for 13th Fiscal Period(\77 million of which is capital expenditure)【Lorns】
Total Interest-bearing Debt
(as of Jan. 17, 2013)

Interest-Bearing Debt Repayment Due During 13th FP(after Jan. 17, 2013)
Repayment through loans (May 2013)：¥5,500 million

Agreed Repayment (Feb. 2013)：¥90 million

18

Unitholders (12th Fiscal Period End)
Changes in Ratio of Units Held by Unitholders※ Unitholders (12thFP)
 Increase in regional financial institutions（units）

150,936units

160,000

17.5%

16.4%

19.2%

12.9%

12.2%

13.0%

13.3%

13.4%

125,535units
120,000

16.9%
10.6%

80,00040,000

15.1%

Individuals/Others( 24,773 unit

9,061 unitholders )Foreign Corporations, etc.
( 18,386 unit
115 unitholders )Domestic Corporation (excluding Financial Institutions)( 20,177 unit
166 unitholders )

15.2%

56.3%

57.4%

Financial Institutions (including Securities Companies)( 87,600 unit
104 unitholders )

58.0%

52.7%

0

[Financial Institutions]

9th FP

10th FP

11th FP

12th FP

Total

72,093 units

57.4%

66,096 units

52.7%

84,986 units

56.3%

87,600 units

58.0%

Banks

6,131 units

4.9%

5,907 units

4.7%

10,282 units

6.8%

15,222 units

10.1%

Trust Banks

53,258 units

42.4%

49,472 units

39.4%

63,816 units

42.3%

61,213 units

40.6%

3,435 units

2.7%

1,954 units

1.6%

2,248 units

1.5%

2,991 units

2.0%

1,665 units

1.3%

1,665 units

1.3%

830 units

0.5%

830 units

0.5%

2,127 units

1.7%

1,589 units

1.3%

1,965 units

1.3%

1,539 units

1.0%

5,477 units

4.4%

5,509 units

4.4%

5,845 units

3.9%

5,805 units

3.8%Life Insurance
Companies
Non-Life Insurance
Companies
Securities
Companies, etc.

Other

Top 10 Unitholders
#

Units

Ratio (%)

#

Units

Ratio (%)

1

Japan Trustee Services Bank, Ltd.

Unitholders

34,745

23.02

6The Joyo Bank, Ltd.

Unitholders

4,602

3.05

2

Nomura Real Estate Development Co., Ltd.

15,24010.10

7

Nomura Bank (Luxembourg) S.A.

3,868

2.56

3

The Nomura Trust and Banking Co., Ltd.

8,370

5.55

8

The Bank of New York Treaty Jasdec Account

3,493

2.31

4

The Master Trust Bank of Japan, Ltd.

7,414

4.91

9

Trust and Custody Services Bank, Ltd.

2,088

1.38

5

Trust and Custody Services Bank, Ltd.

5,864

3.89

10 Mizuho Trust & Banking co., Ltd.

1,882

1.25

Total

87,56658.02(Note) The Ratio is calculated as the percentage of Total Number of Owned Investment Units divided by Total Number of Issued Investment Units.

19

ＡＰＰＥＮＤＩＸ

20

Changes in Asset Size
Replacement (12th FP)

Stable Growth of Portfolio

Acquisition ： US Koganei Honcho
・Acquisition Price ：¥725 million

・Appraisal Value：¥752 million

・NOI Yield

：

6.1 %

・Building Age： 0 7.9 years（billions of yen)

180
160
140
131properties
120¥110.33billion

134properties¥115.93billion

139properties

139properties¥121.48billion¥121.48billion

143properties

144properties¥131.46billion¥133.41billion

143properties¥132.89billion

145properties

152properties

153properties¥149.86billion¥150.58billion¥135.04billion

100
80

89 properties¥67.03 billion

97properties

Leasable Units¥75.42billion

8,917 units

60
40
20
0

#1PO
12,514million

IPO¥30,257milliom
1st FP End

2nd FP End

3rd FP End#3PO
7,161million#2PO
8,029million
4th FP End

5th FP End

6th FP End

7th FP End

8th FP End

9th FP End

10th FP End

11th FP End

Greater Tokyo Area : 81.0%
Other Areas: 19.0%12th FP End(May 31, 2007) (Nov. 30, 2007) (May 31, 2008) (Nov. 30, 2008) (May 31, 2009) (Nov. 30, 2009) (May 31, 2010) (Nov. 30, 2010) (May 31, 2011) (Nov. 30, 2011) (May 31, 2012) (Nov. 30, 2012)*The graph is based on the total acquisition price as of each fiscal period end (rounded down to the nearest 10 million).

Portfolio Overview (12th Fiscal Period End)
Acquisition Price¥150,587 million

Leasable Units

8,917 units

Average Rent Per Unit

approx. ¥95 thousand

Average Leasable Floor Area Per Unit approx. 29 sqm

21

Portfolio Status (12th Fiscal Period End)
Diversification Within Assets

11.

4%■Top 5 Properties¥17.10 billion

Building Age

25.7%■Over 10 years

Improve portfolio stability
through promotion ofdiversification

Considering the combination ofvarious building age to avoid thebias of large-scale repair
expenses⇒Top 10 Properties 19.7%⇒Average Building Age
9.5 Years

80.

3%■Other 143 Properties¥120.89 billion

Investment Area

19.0%
■Other Areas

19.

7%■Top 10 Properties¥29.69 billion

81.0%

37.5%
■5-10 years

Floor Area Per Unit

■Greater Tokyo Area

0.9%
■Over 70 sqm

0.9%■1-3 years

35.9%■3-5 years

0.

5%■Retail & Office

8.2%■50-70 sqm

Greater Tokyo Area 70% or more
Other Areas 30% or less

Investing in properties targeting
single/DINKS/young family
households for theforeseeable future

13.5%
Other Areas(Kanagawa,Chiba, Saitama)⇒Greater Tokyo Area 81.0%⇒Under 50 sqm
4.4%
Tokyo (excluding the 23 wards)

90.5%

19.0%
■30-50 sqm

63.1%
Tokyo (23 wards)

23.0%
Nearest Station on Foot 6.8%
■Over 10 min.

■Over 100 Units

56.0%

8.

4%
■Under 30 Units■Within 5 min.

Selection focusing onaccessibility to the nearest
railway stations

Investing in properties withstrong lease-up potential in ashort timeframe⇒Within 10 min. 93.2 %⇒Average Unit Per Property
58 Units

37.1%

71.

5%
■Under 30 sqm

43.3%■50-100 Units25.

3%■30-50 Units■5-10 min.

22

Appraisal Value Status (12th Fiscal Period End)
Appraisal Value
Appraisal Value Details
10th FP End Appraisal Value (A)*¥141,763 million

11th FP End Appraisal Value (B)¥141,836 million

 Increase

69 properties ( 045.1 %) Flat14 properties ( 019.2 %) Decrease 70 properties ( 045.8 %)+ ¥73 million

Difference (B)-(A)Total

153 properties ( 100.0 %)[Reference]
 BPS

：

¥469,193

 NAV per Unit：

¥415,411

Range of Cap Rate and Book-to-Market Ratio（％）

Average Cap Rate

5.70

5.61

5.60
5.50

5.58

5.57

5.55

5.47

（ - 0.08）

5.43

Book-to-Market Ratio

5.46（ - 0.01）

1.05

1.00

（ - 0.05）

5.40

0.95

5.30
5.20

5.41

（x )

0.94
0.92

5.10

0.89

0.90

0.90

0.91

0.92

（ + 0.02）

0.95（ + 0.01）

0.90

0.85

5.00

5th FP

6th FP

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP*11th FP End Appraisal Value” includes the appraisal value at the time of acquisition of the 8 properties acquired during the 12th FP.
It also excludes the appraisal value of 1 property disposed during the 11th FP.

23

Changes in Revenue
Changes in Rent per Tsubo and Occupancy Rate (9th FP End-13th FP End (forecast))[Rent per Tsubo](Rent per Tsubo)

Rent/Tsubo (Greater Tokyo Area)

Rent/Tsubo (Other Areas)

Rent/Tsubo (Total)

15,00012,500Total ¥11,156¥11,039（Forecast）¥10,662¥10,653

Rent
per Tsubo¥10,597

13th FP End[forecast](May 31, 2013)

9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)

Total¥11,156¥11,039¥10,662¥10,653¥10,597

GreaterTokyo¥12,388¥12,326¥12,325¥12,280

－

Other
Areas

¥6,996¥7,149¥7,302¥7,306－

9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)

13th FP End[forecast](May 31, 2013)

Total

96.1%

96.8%

96.2%

96.2%

96.3%

Greater
Tokyo

95.7%

96.4%

95.5%

95.7%

－

Other
Areas

97.5%

97.8%

97.7%

97.0%

－

9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)

13th FP End[forecast](May 31, 2013)

14.8%

9.7％

14.8％

9.7％

12.1％

Details

10,000

7,500

5,000
9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)

13th FP End [forecast](May 31, 2013)[Occupancy Rate]
（％）

100.0

Occupancy Rate (Greater Tokyo Area)

Occupancy Rate (Other Areas)

Occupancy Rate (Total)

Occupancy
Rate（Forecast）

97.5

Total 96.1%

96.8%

96.2%

96.2%

96.3%

Details

95.0(Reference)

92.5
Turnover
Ratio

Total

90.0
9th FP End(May 31, 2011)

10th FP End(Nov. 30, 2011)

11th FP End(May 31, 2012)

12th FP End(Nov. 30, 2012)

13th FP End [forecast](May 31, 2013)24

Changes in Investment Unit Price and Cash Distribution
Changes in Investment Unit Price
Investment Unit Price (yen)Investment Unit Price

1,000,000

TSE REIT Index

TSE REIT Index

3,000
Mar. 29, 2007
Highest Price:¥979,000

2,700
Mar. 14, 2011
BOJ Announces
Additional Purchase of J-REIT

800,000
Septermber 2008
Lehman Brothers
Bankruptcy

Apr. 27, 2012
BOJ Announces
Additional Purchase of J-REIT

2,400
2,100

Mar. 11, 2011
Great Eastern Japan Earthquake

600,000

Feb. 14, 2012
Enhancement of Monetary Easing

Oct. 5, 2010
BOJ Announces
Purchase of J-REITs

Nikkei Stock AverageMar. 10, 2009
Lowest: 7,054.98

1,800
1,500

400,000

1,200
900

1st PO¥12.5 billion

200,000

0Feb. 142007

May. 312007

1st FP

Nov. 30
2007

2nd FP

May. 312008

3rd FP

Nov. 30
2008

4th FP

May. 312009

5th FP

3rd PO¥7.1 billion

Nov. 30
2009

6th FP

BPS ¥469,193

600

2nd PO¥8.0 billion

Jan. 15, 2009
Lowest Price:¥287,600

Nov 30, 2012
¥463,000

May. 312010

7th FP

Nov. 302010

8th FP

May. 312011

9th FP

300

Nov. 302011

10th FP

0
Nov. 31
2012

May. 312012

11th FP

12th FP

Changes in Cash Distribution（yen）Stability and Growth of Cash Distribution

20,00016,00013,91013,631

12,127

12,0008,000

14,14414,005

11,046

12,068

11,674

11,77012,302

12,424

12,100[Forecast]

8,102

4,000
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 FPMay 31, 2007

Nov. 30, 2007

May 31, 2008

Nov. 30, 2008

May 31, 2009

Nov. 30, 2009

May 31, 2010

Nov. 30, 2010

May 31, 2011

Nov. 30, 2011

May 31, 2012

Nov. 30, 2012

May 31, 201325

Portfolio Map (153 Properties)
Saitama
Kawaguchi

Adachi-ku

Greater Tokyo Area

Itabashi-ku

120 Properties

Kita-ku

Chiba
Nerima-ku

Katsushika-ku

Arakawa-ku

Toshima-ku

Ikebukuro
Taito-ku

Bunkyo-ku

Takadanobaba
Tachikawa

Sumida-ku

Ueno

Nishi
Funabashi

Kichijoji
Suginami-ku

Nakano-ku

Edogawa-ku

Shinjuku-ku
Shinjuku
Chiyoda-ku

TokyoKoto-kuChuo-ku

Shibuya-ku

Shibuya

Other Areas

Minato-ku

Urayasu

Setagaya-ku

33 Properties

Shinagawa

Sapporo13 properties

Meguro-ku

Shinagawa-ku

Osaka
5 properties

Sendai5 properties

Kanagawa
Ota-kuHaneda Airport

Nagoya5 properties
Yokohama

Fukuoka
5 properties
JR Lines
Other Lines*Greater Tokyo Area
(Tokyo, Kanagawa, Chiba, Saitama)

26

Portfolio
#
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36

Name of Property
PROUD FLAT Shirokane Takanawa
PROUD FLAT Yoyogi Uehara
PROUD FLAT Hatsudai
PROUD FLAT Shibuya Sakuragaoka
PROUD FLAT Gakugei Daigaku
PROUD FLAT Meguro Gyoninzaka
PROUD FLAT Sumida Riverside
PROUD FLAT Kagurazaka
PROUD FLAT Waseda
PROUD FLAT Shinjuku Kawadacho
PROUD FLAT Sangen Jaya
PROUD FLAT Kamata
PROUD FLAT Kamata II
PROUD FLAT Shinotsuka
PROUD FLAT Kiyosumi Shirakawa
PROUD FLAT Monzen Nakacho II
PROUD FLAT Monzen Nakacho I
PROUD FLAT Fujimidai
PROUD FLAT Asakusa Komagata
PROUD FLAT Yokohama
PROUD FLAT Kamioooka
PROUD FLAT Tsurumi II
PRIME URBAN Akasaka
PRIME URBAN Tamachi
PRIME URBAN Yoyogi
PRIME URBAN Bancho
PRIME URBAN Chiyoda Fujimi
PRIME URBAN Iidabashi
PRIME URBAN Ebisu
PRIME URBAN Naka Meguro
PRIME URBAN Gakugei Daigaku
PRIME URBAN Senzoku
PRIME URBAN Meguro Riverside
PRIME URBAN Meguro Ohashi Hills
PRIME URBAN Hakusan
PRIME URBAN Yotsuya Gaien Higashi

Location
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Chuo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Nerima-ku, Tokyo
Taito-ku, Tokyo
Yokohama-shi, Kanagawa
Yokohama-shi, Kanagawa
Yokohama-shi, Kanagawa
Minato-ku, Tokyo
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Bunkyo-ku, Tokyo
Shinjuku-ku, Tokyo

Acquisition Price(thousands of yen)
3,510,000
1,100,000
865,000
800,000
812,000
882,000
2,260,000
1,540,000
1,110,000
1,010,000
1,350,000
1,140,000
2,980,000
695,000
900,000
650,000
1,130,000
1,370,000
1,960,000
2,340,000
2,770,000
1,430,000
956,000
941,000
408,000
1,170,000
707,000
2,030,000
1,200,000
1,320,000
886,000
536,000
464,000
3,580,000
893,000
1,700,000

Percentage of
Leasable Floor Area Leasable Units
Total (%)
(sqm)
(units)2.3
2,950.11
106
0.7
1,151.34
44
0.6
958.9831
0.5
638.7030
0.5
934.39410.6855.2340
1.5
3,055.21110
1.0
1,793.4370
0.7
1,450.91
60
0.7
1,102.20
41
0.9
1,277.82
48
0.8
1,541.64
67
2.0
4,051.72
169
0.5
752.0935
0.6
1,209.56
55
0.4
830.5535
0.8
1,191.0855
0.9
2,222.05
94
1.3
2,685.39
79
1.6
3,118.12113
1.8
4,872.17200
0.9
2,219.74
81
0.6
1,062.05
25
0.6
1,107.36
48
0.3
439.5619
0.8
1,277.04
52
0.5
793.8732
1.3
2,087.7090
0.8
1,444.4029
0.9
1,302.42
49
0.6
1,008.39
32
0.4
655.27220.3
453.7724
2.4
2,955.74
99
0.6
1,069.82
42
1.1
1,759.11
51

Occupancy Rate
(Nov，2012)(%)
99.3
100.0
94.5
96.7
100.0
100.0
99.2
100.0
98.5
100.0
92.6
98.5
99.0
91.5
100.0
94.9
98.2
100.0
100.0
98.5
100.0
93.6
94.4
95.9
94.2
91.5
93.8
98.9
100.0
98.0
87.7
100.0
100.0
99.1
92.9
94.3

27

Portfolio
#
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72

Name of Property
PRIME URBAN Nishi Shinjuku I
PRIME URBAN Nishi Shinjuku II
PRIME URBAN Shinjuku Naitomachi
PRIME URBAN Nishi Waseda
PRIME URBAN Sangen Jaya
PRIME URBAN Minami Karasuyama
PRIME URBAN Karasuyama Galleria
PRIME URBAN Karasuyama Court
PRIME URBAN Chitose Funabashi
PRIME URBAN Shinagawa Nishi
PRIME URBAN Osaki
PRIME URBAN Omori
PRIME URBAN Kita Senzoku
PRIME URBAN Denenchofu Minami
PRIME URBAN Nakano Kamitakada
PRIME URBAN Nishi Ogikubo
PRIME URBAN Otsuka
PRIME URBAN Monzen Nakacho
PRIME URBAN Kameido
PRIME URBAN Sumiyoshi
PRIME URBAN Kinshi Koen
PRIME URBAN Kinshicho
PRIME URBAN Hirai
PRIME URBAN Kasai
PRIME URBAN Kasai II
PRIME URBAN Shinyurigaoka
PRIME URBAN Urayasu
PRIME URBAN Gyotoku I
PRIME URBAN Gyotoku II
PRIME URBAN Gyotoku Ekimae
PRIME URBAN Nishi Funabashi
PRIME URBAN Kawaguchi
URBAN STAGE Azabu Juban
URBAN STAGE Shibaura LOFTURBAN STAGE Hatagaya
URBAN STAGE Toritsu Daigaku

Location
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Nakano-ku, Tokyo
Suginami-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Sumida-ku, Tokyo
Sumida-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Kawasaki-shi, Kanagawa
Urayasu-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Funabashi-shi, Chiba
Kawaguchi-shi, Saitama
Minato-ku, Tokyo
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo

Acquisition Price(thousands of yen)
1,290,000
1,000,000
512,000
503,000
835,000
840,000
645,000
413,000
885,000
624,000
1,700,000
824,000
576,000
900,000
640,000
435,000
794,000
2,200,000
705,000
552,000
1,180,000
668,000
700,000
637,000
958,000
1,210,000
840,000
635,000
741,000
476,000
772,000
2,170,000
991,000
1,510,000
452,000
524,000

Percentage of
Leasable Floor Area Leasable Units
Total (%)
(sqm)
(units)0.9
1,459.86
60
0.7
1,162.55
46
0.3
578.18140.3
507.1128
0.6
874.1533
0.6
1,049.73
41
0.4
835.0533
0.3
576.2023
0.6
1,027.4438
0.4
961.2546
1.1
2,106.16
99
0.5
1,190.70
54
0.4
834.9046
0.6
1,100.17
44
0.4
818.7533
0.3
543.0924
0.5
944.9946
1.5
3,207.92
118
0.5
1,117.34
52
0.4
813.5240
0.8
1,886.50
77
0.4
991.6249
0.5
1,095.91
53
0.4
905.8145
0.6
1,437.84
68
0.8
1,708.1964
0.6
1,264.8460
0.4
1,151.36
52
0.5
1,244.00
58
0.3
778.1937
0.5
1,237.80
60
1.4
2,477.11
98
0.7
1,222.1340
1.0
1,905.39
68
0.3
650.6038
0.3
996.8116

Occupancy Rate
(Nov，2012)(%)
95.5
97.9
100.0
100.0
100.0
95.2
90.9
91.3
97.3
100.0
95.0
96.3
97.8
93.3
90.2
100.0
100.0
97.5
98.1
95.0
90.9
100.0
100.0
80.0
86.8
100.0
86.7
80.8
100.0
97.3
93.3
96.7
87.3
98.6
97.4
100.0

28

Portfolio

#
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108

Name of Property
URBAN STAGE Kachidoki
URBAN STAGE Shinkawa
URBAN STAGE Nihonbashi Yokoyamacho
URBAN STAGE Hongo Ikizaka
URBAN STAGE Naka Ochiai
URBAN STAGE Ochiai
URBAN STAGE Shinjuku Ochiai
URBAN STAGE Roka Koen
URBAN STAGE Kamiuma
URBAN STAGE Sangen Jaya
URBAN STAGE Chitose Karasuyama
URBAN STAGE Sangen Jaya II
URBAN STAGE Komazawa
URBAN STAGE Karasuyama
URBAN STAGE Kamikitazawa
URBAN STAGE Yoga
URBAN STAGE Oimachi
URBAN STAGE Oimachi II
URBAN STAGE Yukigaya
URBAN STAGE Ikegami
URBAN STAGE Nakano
URBAN STAGE Takaido
URBAN STAGE Komagome
URBAN STAGE Mukojima
URBAN STAGE Kasai East
URBAN STAGE Ekoda
URBAN STAGE Takinokawa
URBAN STAGE Itabashi Kuyakushomae
URBAN STAGE Asakusa
URBAN STAGE Machiya
URBAN STAGE Machiya South Court
URBAN STAGE Koganei
URBAN STAGE Musashi Koganei
URBAN STAGE Musashino Hills
URBAN STAGE Koganei Honcho
URBAN STAGE Hino

Location
Chuo-ku, Tokyo
Chuo-ku, Tokyo
Chuo-ku, Tokyo
Bunkyo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo
Nakano-ku, Tokyo
Suginami-ku, Tokyo
Toshima-ku, Tokyo
Sumida-ku, Tokyo
Edogawa-ku, Tokyo
Nerima-ku, Tokyo
Kita-ku, Tokyo
Itabashi-ku, Tokyo
Taito-ku, Tokyo
Arakawa-ku, Tokyo
Arakawa-ku, Tokyo
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Hino-shi, Tokyo

Acquisition Price(thousands of yen)
2,290,000
2,250,000
3,530,000
647,000
655,000
324,000
635,000
362,000
900,000
755,000
730,000
539,000
396,000
344,000
738,000
1,150,000
530,000
1,100,000
970,000
1,460,000
472,000
1,080,000
412,000
487,000
940,000
385,000
287,000
940,000
350,000
210,000
1,740,000
229,000
2,390,000
1,590,000
725,000
319,000

Percentage of
Leasable Floor Area Leasable Units
Total (%)
(sqm)
(units)1.5
4,524.00
145
1.5
3,600.61
46
2.3
5,926.17
124
0.4
662.5827
0.4
1,237.98
18
0.2
517.5332
0.4
1,053.39
28
0.2
567.2034
0.6
1,739.86
37
0.5
1,018.72
47
0.5
1,774.0127
0.4
810.98170.3
572.4126
0.2
507.5228
0.5
1,384.45
29
0.8
1,773.05
54
0.4
722.7045
0.7
1,782.26
93
0.6
1,536.59
94
1.0
2,456.48
95
0.3
801.3051
0.7
1,746.20
107
0.3
990.1819
0.3
1,108.91
55
0.6
1,884.62
78
0.3
872.49350.2
554.3929
0.6
1,742.64
68
0.2
876.7022
0.1
455.1926
1.2
4,141.56
77
0.2
682.4327
1.6
5,999.80
98
1.1
2,961.06
80
0.5
1,604.72
43
0.2
994.6854

Occupancy Rate
(Nov，2012)(%)
95.9
96.5
100.0
100.0
88.6
90.8
95.6
91.3
99.1
97.0
85.9
91.2
96.0
90.0
96.2
97.6
100.0
90.1
96.8
94.8
92.9
98.2
75.3
90.9
100.0
94.3
96.5
92.9
95.4
96.4
88.5
89.1
96.6
96.8
97.3
94.4

29

Portfolio

#
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144

Name of Property
URBAN STAGE Kumegawa
URBAN STAGE Musashi Kosugi comodo
URBAN STAGE Kawasaki
URBAN STAGE Tsurumi Teraya
URBAN STAGE Urayasu
URBAN STAGE Minami Gyotoku I
URBAN STAGE Minami Gyotoku II
URBAN STAGE Minami Gyotoku III
URBAN STAGE Minami Gyotoku IV
URBAN STAGE Gyotoku Ekimae
URBAN STAGE Minami Gyotoku V
URBAN STAGE Gyotoku
Greater Tokyo Area
PROUD FLAT Itsutsubashi
PROUD FLAT Kawaramachi
PROUD FLAT Shin Osaka
PRIME URBAN Yamahana
PRIME URBAN Kita Juyo Jo
PRIME URBAN Odori Koen I
PRIME URBAN Odori Koen II
PRIME URBAN Kita Juichi Jo
PRIME URBAN Miyanosawa
PRIME URBAN Odori Higashi
PRIME URBAN Chiji Kokan
PRIME URBAN Maruyama
PRIME URBAN Kita Nijuyo Jo
PRIME URBAN Sapporo Idaimae
PRIME URBAN Nagamachi Icchome
PRIME URBAN Yaotome Chuo
PRIME URBAN Aoi
PRIME URBAN Kanayama
PRIME URBAN Tsurumai
PRIME URBAN Esaka I
PRIME URBAN Esaka II
PRIME URBAN Esaka III
URBAN STAGE Sapporo Riverfront
URBAN STAGE Kita Sanjo Dori

Location
Higashimurayama-shi, Tokyo
Kawasaki-shi, Kanagawa
Kawasaki-shi, Kanagawa
Yokohama-shi, Kanagawa
Urayasu-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Sendai-shi, Miyagi
Sendai-shi, Miyagi
Osaka-shi, Osaka
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sendai-shi, Miyagi
Sendai-shi, Miyagi
Nagoya-shi, Aichi
Nagoya-shi, Aichi
Nagoya-shi, Aichi
Suita-shi, Osaka
Suita-shi, Osaka
Suita-shi, Osaka
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido

Acquisition Price(thousands of yen)
1,370,000
2,150,000
1,150,000
457,000
277,000
357,000
285,000
263,000
256,000
561,000
293,000
948,000
121,960,000
682,000
724,000
1,430,000
377,000
336,000
530,000
322,000
600,000
576,200
424,000
337,900
283,200
503,700
731,600
1,110,000
428,000
724,000
632,000
1,189,096
672,000
790,000
1,535,000
3,500,000
1,450,000

Percentage of
Leasable Floor Area Leasable Units
Total (%)
(sqm)
(units)0.9
2,610.05
91
1.4
3,691.28
56
0.8
1,706.4680
0.3
952.0650
0.2
437.9427
0.2
682.05410.2
611.6137
0.2
542.6933
0.2
535.0832
0.4
927.3346
0.2
662.6838
0.6
1,766.47
77
81.0
177,653.15
6,542
0.5
1,861.56
60
0.5
1,967.5464
0.9
2,990.68
112
0.3
1,518.58
33
0.2
1,155.6036
0.4
1,850.20
53
0.2
1,148.72
36
0.4
1,851.39
60
0.4
2,114.53
54
0.3
1,494.36
36
0.2
1,007.30
420.2
911.0727
0.3
1,773.9036
0.5
2,439.9058
0.7
3,411.2460
0.3
1,380.21
43
0.5
1,571.04
46
0.4
1,391.0258
0.8
2,502.11
104
0.4
1,189.12
48
0.5
1,392.00
57
1.0
2,151.67
79
2.3
15,459.57
310
1.0
5,094.29
114

Occupancy Rate
(Nov，2012)(%)
83.3
96.8
100.0
100.0
88.9
85.5
86.5
93.9
96.9
87.0
80.0
100.0
95.7
100.0
100.0
99.0
85.7
92.9
100.0
100.0
98.3
98.4
94.5
100.0
100.0
97.2
96.4
100.0
100.0
90.3
100.0
99.0
95.8
94.8
93.1
97.2
98.0

30

Portfolio
#
145
146
147
148
149
150
151
152
153

Name of Property
URBAN STAGE Tsutsumidori Amamiya
URBAN STAGE Kamimaezu
URBAN STAGE Izumi
URBAN STAGE Tamatsukuri
Benefis Hakata Grand Suite
Benefis Yakuin Minami
Benefis Kashii Verbena
Benefis Hakata Higashi Grand Suite
Benefis Chihaya Grand Suite
Other Areas
Total

Location
Sendai-shi, Miyagi
Nagoya-shi, Aichi
Nagoya-shi, Aichi
Osaka-shi, Osaka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka

Acquisition Price(thousands of yen)
969,000
1,250,000
2,800,000
906,000
830,000
351,000
396,000
693,000
545,000
28,627,696
150,587,696

Percentage of
Leasable Floor Area Leasable Units
Total (%)
(sqm)
(units)0.6
4,251.91
65
0.8
3,541.43
101
1.9
7,543.10250
0.62,373.1080
0.6
2,176.23
67
0.2
897.8434
0.3
1,222.34
39
0.5
1,854.13
65
0.4
1,740.70
48
19.0
85,228.38
2,375
100.0
262,881.53
8,917

Occupancy Rate
(Nov，2012)(%)
100.0
94.3
99.1
92.2
96.9
84.8
96.7
98.4
88.4
97.0
96.2

31

Changes in Financial Performance

7th FP

8th FP

9th FP

10th FP

11th FP

12th FP

Operating Revenues

million y en

4,323

4,466

4,510

4,445

5,250

5,174

Operating Profits

million y en

2,037

2,150

2,177

2,098

2,507

2,452

Net Income

million y en

1,386

1,514

1,465

1,477

1,856

1,875

Asset Total

million y en

138,755

140,614140,534

140,152

156,780

156,703

Interest-bearing Debt Total

million y en

73,04674,676

74,606

74,216

83,182

83,092

Net Asset

million y en

63,18663,31463,26563,27770,81870,836Return on Assets (ROA)

%

2.0

2.2

2.2

2.1

2.4

2.4

Return on Equity (ROE)

%

4.4

4.8

4.6

4.7

5.2

5.3

FP End Capital Adequacy Ratio

%

45.5

45.0

45.0

45.1

45.2

45.2

LTV

%

52.6

53.1

53.1

53.0

53.1

53.0

times

3.4

3.5

3.4

3.6

4.3

4.5

%

1.61

1.62

1.61

1.47

1.28

1.27

y ears

2.4

2.1

2.8

2.5

3.0

3.0

million y en

3,300

3,459

3,452

3,424

4,016

4,010

%

5.02

5.19

5.20

5.06

5.34

5.31

FFO

million y en

2,174

2,305

2,251

2,285

2,817

2,850

Portfolio

properties

143

144

143

145

152

153

Acquisition Price Total

million y en

131,462

133,416

132,890135,046

149,862

150,587

Book Value Total

million y en

133,272

134,701

133,564

135,196

150,099

149,972

Appraisal Value Total

million y en

119,471

121,231

121,042

124,512141,011

141,836

NAV per Unit

thousand y en

393

397

404

418

408

415

Interest Coverage Ratio
Weighted Average Interest Rate
Long-term Debt Average Remaining Duration
Rent NOINOI Yield (acquisition price base)

ROA=Current Profits/[(Total Asset Value at Start of FP+Total Asset Value at FP End)÷2]x100 *annual basis
ROE=Net Income/[(Total Asset Value at FP Start+Total Asset Value at FP End)÷2]x100 *annual basis
Capital Adequacy Ratio at FP End=Net Asset at FP End/Total Asset at FP End x 100
LTV=Total Interest-bearing Debt at FP End/Total Asset at FP End x 100
Interest Coverage Ratio=Net Income Before Interest Depreciation/(Interest Expenses+Investment Coroporation Bond Interest)

Rent NOI=Real Estate Rental Business Revenues-Real Estate Rental Business Income+Current FP Depreciation and Amortization
NOI Yield (Acquisition Price Base)=Rent NOI/Total Acquisition Price x 100 *annual basis
FFO=Net Income+Current FP Depreciation and Amortization+Investment Corporation Bond Issuance Ammortization-Real Estate Disposition Profit & Loss
NAV per Unit=[Net Asset Total-(Income Statement Total-Appraisal Value Total)]/Total Number of Investment Units Issued*annual basis=each measure/operating days x 365 days

32

Interest-bearing Debts (12th Fiscal Period End)FP of Repayment

13th Fiscal Period(ending May 31, 2013)

14th Fiscal Period(ending Nov. 30, 2013)

15th Fiscal Period(ending May 31, 2014)

16th Fiscal Period(ending Nov. 30, 2014)

17th Fiscal Period(ending May 31, 2015)

18th Fiscal Period(ending Nov. 30, 2015)

19th Fiscal Period(ending May 31, 2016)

20th Fiscal Period(ending Nov. 30, 2016)
21st Fiscal Period(ending May 31, 2017)22th Fiscal Period(ending Nov. 30, 2017)23th Fiscal Period(ending May 31, 2018)

19th Fiscal Period(ending May 31, 2016)
21st Fiscal Period(ending May 31, 2017)

Amount of Repayment¥7,190 million¥6,362 million¥9,290 million¥6,660 million

LenderAmountInterest Rate

Date of Loan

Date of Repayment

4 Lenders¥1,600 million

1.51625%

Dec. 03, 2009

Dec. 03, 2012

3 Lenders¥5,500 million

1.83625%

May. 23, 2008

May. 23, 2013

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

Shot-term Loan

3 Lenders¥5,472 million

1.74250%

Sep. 29, 2008

Sep. 29, 2013￥13,552 million

1 Lender¥800 million

1.99875%

Sep. 27, 2007

Sep. 30, 2013

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

2 Lenders¥2,000 million

2.14360%

Feb. 27, 2007

Feb. 27, 2014

1 Lender¥2,000 million

2.13625%

Feb. 27, 2007

Feb. 27, 2014

3 Lenders¥1,700 million

0.88417% （注4）

Aug. 26, 2011

Feb. 27, 2014

6 Lenders¥3,500 million

0.88417% （注4）Sep. 30, 2011

Feb. 27, 2014

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

6 Lenders¥3,170 million

0.81917%

Aug. 27, 2012

Aug. 27, 2014

3 Lenders¥3,400 million

0.94700%

Sep. 05, 2011

Sep. 05, 2014

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

1 Lender¥1,000 million

1.79200%

Feb. 26, 2010

Feb. 26, 2015

Category

1 Lender¥1,300 million

2.23500%

May. 15, 2007

Feb. 27, 2015

5 Lenders¥5,400 million

0.96365%

Feb. 27, 2012

Feb. 27, 2015

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

Long-term Loan

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

￥59,540 million

5 Lenders¥9,700 million

1.00900%

Feb. 27, 2012

Aug. 27, 2015

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

1 Lender¥4,700 million

1.00000%

Dec. 26, 2011

Dec. 26, 2015

1 Lender¥40 million

2.10000%

Aug. 27, 2009

（注2）

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

2 Lenders¥9,400 million

1.11700%

Dec. 26, 2011

Jun. 26, 2016

1 Lender¥1,080 million

2.10000%

Aug. 27, 2009

Aug. 27, 2016

1 Lender¥50 million

2.03000%

Feb. 26, 2010

（注3）

¥1,350 million

1 Lender¥1,350 million

2.03000%

Feb. 26, 2010

Feb. 26, 2017

¥3,920 million

3 Lender¥3,920 million

1.08500%

Aug. 27, 2012

Aug. 27, 2017

¥5,420 million

6 Lender¥5,420 million

1.12013%

Aug. 27, 2012

Feb. 27, 2018

¥73,092 million

19 Lenders

－

－

－

¥5,000 million

1.21000%

Feb. 25, 2011

Feb. 25, 2016

¥5,000 million

1.03000%

Feb. 24, 2012

Feb. 24, 2017

－

－

－

¥7,790 million¥9,790 million¥4,790 million¥10,530 million¥5,000 million¥5,000 million¥83,092 million

Investment
Corporation Bond
Investment
Corporation Bond

－

－

－

(Note 1) The interest rate stated regarding this loan takes into consideration the Interest Rate Swap transaction.
(Note 2) The amount of ￥40 million to be repayed on February 27, 2010, the first repayment date, and every August 27 and February 27 thereafter, until the last repayment of ￥1,080 million on August 27, 2016.
(Note 3) The amount of ￥50 million to be repayed on August 26, 2010, the first repayment date, and every February 26 and August 26 thereafter, until the last repayment of ￥1,350 million on February 26, 2017.
(Note 4) Regarding the Floating Rate, the interest rate as of the end of the 11th Fiscal Period is stated.

33

Fund Profile

Structure

History
July 28, 2006

Asset Custodian

General Administration(Financial Agent)

The FundGeneral Administration

Financial Agent
Agreement

Administration ofUnitholders Register
Management ofSpecial Accounts
Mitsubishi UFJ
Trust and Banking Corporation

Asset Custody
Agreement

The Bank
Bank ofof
The
Tokyo-Mitsubishi UFJ, Ltd.
Tokyo-Mitsubishi UFJ, Ltd.
Sumitomo Mitsui
Banking Corporation

Administration
Agreement, etc.

General Administration(Accounting, etc.)

Notification of incorporation by the founder (Nomura Real
Estate Asset Management Co., Ltd.) under Article 69 of theInvestment Trust Law.
August 3, 2006
Registration of incorporation under Article 166 of theInvestment Trust Law. Incorporation of the Nomura Real
Estate Residential Fund, Inc.

Nomura Real Estate Residential Fund, Inc.
Accounting Service
Agreement

August 4, 2006
Applied for registration under Article 188 of the Investment
Trust Law.

Unitholders Meeting

Heiseikaikeisha Tax
Corporation

Board of Directors Meeting
Financial Institutions, etc.

August 24, 2006
Registration approved by the Prime Minister of Japan under
Article 187 of the Investment Trust Law (Registration number
56, filed with the Director of the Kanto Local Finance Bureau).

AuditorErnst & Young ShinNihon LLC

Repaymentof Principal& Interest

Debt
Finance
Debt

Investment
Residential Properties(Real Estate Related Assets)
Property
Management
Property Management
Companies

Select the best property
management companies
for each property

CapitalInvestment

Asset

Trade

February 14, 2007
Listing on the Tokyo Stock Exchange.

Unitholders

EquityRent, etc.

Unitholders

Distribution
Property Management
Agreement

Instructions for
Rent &
Management
Rental Strategies,
Plans for
Repairs, etc.

Asset Management
Services Agreement
Information & ResearchService Providers

Asset Management Company
Property
Information

Nomura Real Estate
Development Co., Ltd.
Nomura Real Estate
Urban Net Co., Ltd.

34

Asset Management Company Overview
General Meeting of Shareholders

Structure（ as of January 17, 2013 ）Board of Directors

Board of Statutory Auditors

President & CEO

Statutory Auditors

Compliance Committee

Investment Committee

Risk Management Committee

NPR Valuation Committee
Project Screening Committee

Investment Advisory

Fund Management

Corporate Planning

Chief Investment Officer, NOF

Client Relations & Marketing

Legal & Compliance

Chief Investment Officer, NRF

Investment Management Planning

Internal Audit

Chief Investment Officer, NPR

Acquisitions

Business Coordinate

Chief Investment Officer, Private Fund Ⅰ

Investment Management

Chief Investment Officer, Private Fund Ⅱ

Asset Management

Chief Investment Officer, Private Fund Ⅲ

Finance

Chief Investment Officer, Private Fund Ⅳ

Accounting

Name

Nomura Real Estate Asset Management Co., Ltd.

Location

8-5-1 Nishi-Shinjuku, Shinjuku-ku, Tokyo160-0023, Japan

Registrations,
License, etc.

Financial instruments business operator registration:
Commissioner of the Kanto Local Finance Bureau (Financial Instruments) No. 374
Licensed for discretionary proxy in realty trading: Minister of Land, Infrastructure and Transport Permit No.18
Licensed for real estate trading: Governor of Tokyo (2) No. 81679
Money lender registration: Governor of Tokyo (1) No.31401

Memberships

the Investment Trusts Association, Japan; the Japan Securities Investment Advisers Association,
the Association for Real Estate Securitization, etc.

Contact Information

Fund Management

03-3365-7729

nrf3240@nomura-re.co.jp

35This document has been prepared for the purpose of provision of information only, and should not be construed
as an offer, solicitation or commercial conduct of any nature associated with any specific products. Investors
wishing to purchase the investment units of Nomura Real Estate Residential Fund, Inc. should contact their own
securities brokers or dealers. A fee may be charged by your financial instruments business operator in relation
to the sale or purchase of investment units.
For management fees that the Fund pays to Nomura Real Estate Asset Management Co., Ltd., please refer tothe terms and conditions of the Fund, asset management reports, etc.
The forward-looking statements with respect to the future financial results contained in this document are basedon the current facts about the investment policy of the Fund, applicable laws and regulations, the market
environment, business practice, etc., as of the preparation date of this document and do not reflect or consider
any changes in the circumstances after the preparation date. These forward-looking statements inherently
reflect uncertainty about known risks as well as unknown risks and other factors and may deviate from theactual operating and management results, financial conditions, etc., of the Fund.

Investment in real estate investment securities may result in a loss due to a decline in the transaction pricecaused by, for example, changes in the price or the revenue-generating capability of the underlying properties
or deterioration of the financial conditions of the issuer.
Although the information contained in this document is intended to be complete and thorough, there is no
assurance of precision and safety of the same. Please note that the contents of this document is subject tochange or cancellation without prior notice.
It is prohibited to make duplication, reproduction, distribution or use of any part or whole of the information
contained in this document without express prior written consent.