JPR-第四期 C1-C4 04.4.9 10:14 AM ページ 1 (1,1)

JPR
JAPAN PRIME REALTY INVESTMENT CORPORATION

Fourth Fiscal Period Business Report
July 1, 2003– December 31, 2003

Printed in Japan

JPR-第四期 C1-C4 04.4.9 10:14 AM ページ 41 (1,1)

PROFILEC O R P O R AT E D ATA

Established on September 14, 2001, Japan Prime Realty Investment Corporation
is a closed-end, corporate type fund that invests primarily inhigh-quality office buildings and retail properties locatedin Tokyo and other major cities in Japan.

Head Office
9-9 Yaesu 1-Chome, Chuo-ku, Tokyo 103-8285, Japan
Tel: +81-3-3231-1051
Fax: +81-3-3274-7775
Date of Establishment
September 14, 2001
Listing
Tokyo Stock Exchange (Securities Code: 8955)

With its geographically diverse portfolio, JPR’s primary objective is to achievesustainable growth and stable cash distributions to its investors.

Fiscal Period Ends
June 30 and December 31 of each year
General Meeting of Unitholders
More than once every two years
Cash Distribution Payment Eligibility
Unitholders of record as of June 30 and December 31 ofeach year
Transfer Agent
Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo

Location of Records
Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo
Main Branch, Stock Transfer Agency Division
Mailing Address Mizuho Trust & Banking Co., Ltd.
1-17-7 Saga, Koto-ku, Tokyo 135-8722
Stock Transfer Agency Division
Telephone+81-3-5213-5213 (Representative)
AgentsMizuho Trust & Banking Co., Ltd.
(All branches nationwide)
Mizuho Investors Securities Co., Ltd.
(Head Office and all branches nationwide)
Note: On March 12, 2003, Mizuho Trust & Banking Co., Ltd. merged with Mizuho
Asset Trust & Banking Co., Ltd., to establish a new trust and banking entity under
the name of Mizuho Trust & Banking Co., Ltd. As a result, Mizuho Trust & Banking's
main branch changed its address on the same date.

Websitehttp://www.jpr-reit.co.jp/jpr_e/index.html

English page
This Website has been createdspecifically for our English-speaking
readers.

Performance
Trends in occupancy rate byarea and purpose; trends ininvestment conditions.
Updated monthly.

ANNUAL SCHEDULE (PROVISIONAL)
FAQ
DEC.

12 Balance date for the six-month period ended December 31
FEB.

2

Answers to commonly asked
questions by our unitholders
and investors are found here.

Announcement of results for the six-month period ended December 31
MAR.

3

Publication of December Performance Information Report
Payment of cash distributions for the six-month period ended December 31

Balance date for the six-month period ended June 30

6 JUNE

Announcement of results for the six-month period ended June 30

8 AUG.

Publication of June Performance Information Report
Payment of cash distributions for the six-month period ended June 30

9 SEPT.

Note: Performance Information Report is prepared pursuant to the Investment Trust Law of Japan.

CONTENTS: TO OUR INVESTORS 1 FINANCIAL HIGHLIGHTS 3 PORTFOLIO BREAKDOWN 5 ACTIVITY HIGHLIGHTS 7 SUBSEQUENT ACTIVITY HIGHLIGHTS 9
PROPERTY PORTFOLIO OF JPR 10 REIT STRUCTURE AND EXTERNAL SERVICE PROVIDERS 21 MANAGEMENT’S DISCUSSION AND ANALYSIS 24
FINANCIAL STATEMENTS 28 UNITHOLDER INFORMATION 39 MEMBERS OF THE BOARD 40 CORPORATE DATA 41

Investor Relations
News releases are posted here as appropriate, as well as
information useful to unitholders and investors in evaluating
the status of JPR, including financial statements and otherlegally mandated reports.

This document contains a translation of selected information described in the Financial Report (Kessan Tanshin) dated February 17, 2004 prepared under the timely disclosure requirementsof the Tokyo Stock Exchange, as well as the Financial Statements and Performance Information Report prepared pursuant to the Investment Trust Law of Japan, for the period from July 1,
2003 to December 31, 2003 of Japan Prime Realty Investment Corporation (“JPR”).
This English language document was prepared solely for the convenience of and reference by non-Japanese investors and is not intended to constitute a disclosure document. The
Japanese language Financial Report, Financial Statements and Performance Information Report for the aforementioned period should be referred to as the originals of this document.
English translations for legal, accounting, tax and business concepts used herein may not convey precisely identical concepts of the equivalent Japanese terms. The figures presented in
the financial statements may differ from the Company’s Financial Report (Kessan Tanshin) due to rounding. With respect to any and all terms herein, including without limitation, financial
statements, if there exist any discrepancies in the meaning or interpretation thereof between the original Japanese documents and English documents contained herein, the original
Japanese documents will govern the meaning and interpretation. Neither JPR, Tokyo Realty Investment Management, Inc. nor any of their respective directors, officers, employees, partners,
unitholders, agents or affiliates will be responsible or liable for the completeness, appropriateness or accuracy of English translations or the selection of the portion(s) of any document(s)translated into English. No person has been authorized to give any information or make any representations other than as contained in this document in relation to the matters set out in thisdocument, and if given or made, such information or representation must not be relied upon as having been authorized by JPR, Tokyo Realty Investment Management, Inc. or any of theirrespective directors, officers, employees, partners, unitholders, agents or affiliates.
The financial statements of JPR have been prepared in accordance with generally accepted accounting principles in Japan (Japanese GAAP), which may materially differ in certain
respects from generally accepted accounting principles in other jurisdictions.
Many provisions of this document contain information that constitute forward-looking statements. These forward-looking statements are not a guarantee of future performance andinvolve risks and uncertainties, and actual results may differ materially from those in the forward-looking statements as a result of various factors.

41

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 1

TO OUR INVESTORSJapan Prime Realty Investment
Corporation (JPR) reported impressive
increases in operating revenues and earnings for the six-month period ended
December 31, 2003 (the Company’s fourthfiscal period since it began operations).
Operating revenues rose 22.0% comparedwith the previous fiscal period to ¥6,421
million, operating profits surged 30.6% to¥2,934 million and net income grew 24.0%
Hirohito Kaneko (left)to ¥2,467 million. The fourth fiscal period
cash distribution per unit is ¥5,738, or

Executive Officer,
Japan Prime Realty Investment
Corporation

99.9% of distributable income, comparedToshihiro Hagiwara (right)

with ¥6,873 for the third fiscal period. The

President and CEO,Tokyo Realty Investment
Management, Inc.

amount of the cash distribution per unit
was diluted by the issue of an additional
140,400 investment units during the fiscal

rental rates. In the real estate market,

period under review.

asset sales continued to pick up as financial institutions dealt with non-performing

A Solid Performance Under Challenging

loans and prepared for the introduction ofConditions

asset impairment accounting.

Operating conditions for Japanese real

Against this backdrop, JPR and its

estate investment trusts (J-REITs) wereasset management company Tokyo

mixed in the period under review. In the

Realty Investment Management, Inc.

market for leased office space, the pace of(TRIM) continued to successfully create agrowth in vacancy rates showed signs ofstable revenue stream and enhanced

slowing in much of Greater Tokyo, owing todiversification of its portfolio by geo-a drop in the supply of newly constructed

graphical location and type of use. To

office buildings. Overall demand remained

steadily expand its asset base and main-

weak, however, as corporate restructuring

tain profitability, JPR procured funds

led to higher vacancy rates and lower

totaling ¥32,132 million through the issue1

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 2of additional investment units in Julyownership of the Fukuoka Building,

2003, increasing unitholders equity tolocated in central Tokyo, for ¥1,800 million.

¥89,114 million and reducing the balance

When expanding its property portfolio,of total interest-bearing liabilities by

the Company strives to keep risk at a

¥17,034 million.

minimum by considering the tenant composition and geographical diversification of
its property portfolio. JPR’s target property

Overview of the Fourth Fiscal Period

portfolio is 80% office buildings and 20%
commercial facilities. By geographic

Acquisitions and Divestments

region, we target 60% of investment in

The asset base was expanded during theTokyo (including the central business districts and the Greater

The asset base was expanded during the fourthfiscal period through targeted investment in largescale office buildings and retail properties.

Tokyo area), with theremaining 40% in othermajor cities in Japan.
JPR plans to maintainthese ratios while2

fourth fiscal period through targeted

expanding its asset base to ¥300,000

investment in large-scale office buildings

million by the end of 2006. The Company

and retail properties in central Tokyo,

makes every effort to acquire additional

Osaka and Nagoya. JPR acquired theprime properties at favorable terms andremaining 44.7% beneficial interest in theconditions based on highly reliable infor-

Kuraray Nissay Building, located in Osaka,mation from a broad variety of informationfor ¥5,000 million, and acquired unit own-

sources.

ership of the Gotanda First Building,

Meanwhile, JPR sold the Yasuda-Life

located in Tokyo, for an investment ofTenroku Building on September 3, 2003 for¥2,920 million. In addition, the Company¥609 million, generating a profit of ¥171

acquired the Nagoya Kowa Building,million, the first J-REIT property sale bylocated in Nagoya, for ¥4,550 million, andthe Company. This was the result of efforts

co-ownership of the land and partial unit

to improve the value of the property

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 3

FINANCIAL HIGHLIGHTS

All amounts in millions of yen
unless otherwise stated

All amounts in millions of yen
unless otherwise stated

All amounts in millions of
U.S. dollars unless otherwise stated (*)

4th period ended
December 31, 2003

3rd period ended
June 30, 2003

4th period ended
December 31, 2003

Operating revenues

6,421

5,265

59.9

Operating expenses

3,487

3,018

32.5

Operating profits

2,934

2,246

27.4

Income before income taxes

2,468

1,991

23.0

Net income

2,467

1,990

23,0

Total assets

156,576

144,989

1,461.6

Interest-bearing liabilities

52,466

69,500489.7

Total unitholders’ equity

91,581

58,972854.9

Unitholders’ capital

89,11456,982

831.8

Cash distributions

2,467

1,990

23.0

Dividend payout ratio

99.9%

100.0%—

Number of units (units)

430,000

289,600—

Unitholders’ equity per unit (yen/U.S. dollars)

212,979

203,634

1,988.0

Cash distribution per unit (yen/U.S. dollars)

5,738

6,873

53.6

Funds from operations (FFO) per unit (yen/U.S. dollars)

8,391

9,962

78.3

Return on total assets (annualized)

3.2%

3.2%

—

Return on total unitholders’ equity (annualized)

6.5%

6.8%

—

Equity ratio

58.5%

40.7%

—

Interest-bearing liabilities to total assets

33.5%

47.9%

—

Debt service coverage ratio (times)

11.0

10.0

—

Property net operating income (NOI)

4,298

3,606

40.1

NOI yield (annualized)

5.7%

5.8%

—

Property net cash flows (NCF)

3,651

3,311

34.1

NCF yield (annualized)

4.8%

5.3%

—

32

30

—

Number of properties
Number of tenants
Total leasable floor space (square meters)
Occupancy rate

357

324

—

218,734.67

201,808.72

—

92.7%

93.5%

—

(*) The rate of ¥107.13=US$1.00, the foreign exchange rate on December 30, 2003, has been used for translation.

3

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 4

through repairs and other improvements,

Cost Reductions and Property Management

which successfully raised the occupancy

Strategyrate from 55% to 100% since it was

JPR worked to realign property manage-acquired in November 2001. The Yasuda-

ment costs while maintaining a high level

Life Tenroku Building was sold in accor-of services for tenants by reviewing thedance with JPR’s fundamental investment

contracts for each office building.

policy and after an examination of its

Specifically, JPR contracted with indepen-

impact on cash distributions, overall asset

dent third parties to evaluate the capabili-

portfolio composition, and geographicalties of its property managers (PMs) in the

spread. The Company also gave due con-period under review, proposing measuressideration to changes in the current status

for improvement and providing feedback toeach PM in order tofurther improve tenant

JPR successfully reduced property management
costs by 3.5%, outperforming its goal of 3%.

satisfaction.
Although the overall
occupancy rate of theportfolio fell from 93.5%

and forecasts for real estate revenues andin the previous fiscal period to 92.7% as of

asset values.

December 31, 2003, this was against an

These acquisitions and divestments

initial forecast of 91.5%. This better-than-brought the total number of properties in

expected result can be attributed to

JPR’s portfolio to 32, with a total acquisi-

aggressive efforts to attract new tenants

tion price of ¥139,649 million, leasable

through renovations and repairs tofloor space of 218,734.67 square meters,

improve competitiveness.

and 357 tenants. JPR believes that these

Moreover, during its third and fourthacquisitions and divestments helped tofiscal periods, JPR successfully reduced

improve the balance and quality of its port-

property management costs by 3.5% (onfolio and to ensure a stable revenue

yearly contracts for properties held as ofstream.

the second fiscal period), outperforming
its goal of 3%.

4

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 5

PORTFOLIO BREAKDOWN

Value Breakdown by Region

NOI Breakdown by Region

Total Leased Floor Space by Region

Tokyo CBDs 39.7%(¥55,390 million)

Tokyo CBDs 33.2%(¥1,426 million)

Tokyo CBDs 22.1%(44,760.96 m2)

Greater Tokyo 19.6%(¥27,357 million)
40.7%
Other cities(¥56,902million)

Greater Tokyo 25.2%(¥1,082 million)
41.7%
Other cities(¥1,791 million)

Greater Tokyo 31.1%(63,098.19 m2)
46.8%
Other cities(94,992.54 m2)¥139,649¥4,298202,851.69

millionmillionm2

Value Breakdown by TypeNOI Breakdown by Type

Offices
72.6%(¥101,409 million)

Offices(¥2,837 million)

Retail properties 27.4%(¥38,240 million)

Retail properties 34.0%(¥1,461 million)

Total Leased Floor Space by Type

66.0%

Offices(135,487.56 m2)

66.8%

Retail properties 33.2%(67,364.13 m2)¥139,649¥4,298202,851.69

millionmillionm2

Tenancy Industry Spread
Retail36.9%
Other services
27.6%
Insurance
8.7%
Wholesale
6.9%
Electronics and electric appliances 3.5%
Chemical
2.8%
Construction and civil engineering
2.3%

1.8%
1.8%
1.1%
0.9%
0.8%
0.6%
4.4%

Public services
MedicalCommunications
Real estate
Banking
TextileOther

Total Leasable Floor Space and Occupancy Rate

Portfolio Growth

Total leasable floor space (m2)(%) Occupancy rate

Accumulated
Investment

Properties

100

220,000

32¥139.65 billion

95

200,00030¥125.80 billion

90
180,00085¥94.60 billion¥92.18 billion

80¥72.66 billion

160,000

25

27

June
2002

Sept. 2002 to
Dec. 2002

18

140,00075

13

120,000
70
100,000¥40.73 billion

65

60

80,000

Nov.
2001

Dec.

Mar.
2002

June

Sept.

Dec.

Mar.
2003

June

Dec.

Purchase
Period

Nov.
2001

Dec.
2001

Jan. 2003 toJune 2003

July. 2003 to
Dec. 2003

Note: Accumulated investment does not include miscellaneous acquisition
expenses, fixed assets tax, city-planning tax and consumption tax.

5

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 6

Looking Ahead

Doujima F Building on January 23, 2004,
the Kawaguchi Center Building on

Property Acquisition

February 13, 2004 and the SEF Building on

JPR is implementing measures to improve

March 1, 2004. The Company is alsostability through diversification by region

working to enhance its source of funds, toand type of use, and to increase investment

expand its relationships with a variety ofefficiency through greater economies offinancial institutions, and to reduce pro-scale, while maintaining its investment

curement costs.

policy and healthy cash distributions.
The Company will consolidate efforts to
expand its information channels regarding

Ongoing Strategy to Increase Value

JPR invests a predetermined percentage
of total assets in

JPR will continue to enhance its research systemcapability to provide prompt data on trends according
to property type and geographic location.

office buildings thathave room for
improvement in
profitability andvalue. These prop-

the acquisition of new properties. To thiserties, which we refer to as "value-end, JPR will continue to enhance its

enhanced properties," have either secure

research system capability to provide

profitability and occupancy rates below

prompt data on trends according to prop-

80%, or growth potential through renova-

erty type and geographic location. The

tion. JPR maintains a three-point plan,

Company also aims to concentrate invest-

namely to strengthen leasing activities toment on prime office buildings in Tokyo’s

increase occupancy rates, to raise market

CBDs and highly profitable properties incompetitiveness through renovation andother areas.

renewal, and to reduce costs by increasing

The Company is furthering its acquisi-

6

building management efficiency. In thistion strategy in the current six-monthmanner, the Company is focusing on aperiod, which will end June 30, 2004.

value-enhanced property strategy with theThrough the issue of unsecured corporate

aim of improving profitability and securing

bonds and cash on hand, JPR acquired thestable earnings. Moreover, we areJPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 7

ACTIVITY HIGHLIGHTS

Gotanda First Building
Completed in 1989, the Gotanda First Building is an office building conveniently situated two minutes on foot from Gotanda Station, serviced by the Yamanote Line, Tokyu
Ikegami Line, and the subway Toei Asakusa Line. Tenants include CMIC Co., Ltd., and
NEC Lighting Ltd.

• Site Area (m2):
1,151.19• Total Floor Space (m2): 10,553.34• Structure/Floors: SRC/RC/S B2/11F• Completed:
July 1989

Kuraray Nissay Building
Featuring shops, cinemas and parking facilities, the Kuraray Nissay Building—of
which JPR increased its ownership to 100% in July, 2003—is centrally located in
Osaka and only five minutes from JR Osaka Station. The Loft Co., Ltd. is the major
tenant.

• Site Area (m2):
3,518.68• Total Floor Space (m2): 17,897.56• Structure/Floors: SRC B1/8F• Completed:
April 17, 1990

Nagoya Kowa Building
The facility is comprised of two properties. Property 1 is primarily used as an officespace and for shops while property 2 contains parking facilities for property 1. Thislocation boasts close proximity to Sakae Station on the Higashiyama and Meijo subway
lines. Major tenants include Giorgio Armani Japan and Novarese Inc.

• Site Area (m2):
992.31 • Completed: January 31, 2003 (Property 1),
2
December 25, 1986 (Property 2)• Total Floor Space (m ): 7,260.65• Structure/Floors:
S B1/11F

Fukuoka BuildingThis versatile building is used as an office building and includes a bank and parking
lot. Conveniently located, it takes six minutes on foot from JR Tokyo station, and only
two minutes from Kyobashi Station on the Ginza line.

• Site Area (m2):
1,302.17• Total Floor Space (m2): 11,627.74• Structure/Floors: SRC B2/10F• Completed:May 31, 1990

7

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 8

considering the sale of existing properties

services. JPR will continue to make every

to realize increases in property values.

effort to improve cost performance throughThis strategy led to the sale of the Yasuda-

long-term maintenance and repair plans

Life Tenroku Building in September 2003.

that consider the entire life cycle, and

It is also being employed to increase thechoosing building maintenance companies

market value of the JPR Ikebukurowith high market competitiveness.

Building (formerly the Yasuda-Life
Ikebukuro Building), which is being reinforced to better withstand earthquakes,

Based on a sound investment policy, JPR’s

receiving enhanced air-conditioning equip-

ongoing goal is to secure stable medium-

ment and having its interior renovated.

and long-term growth. Backed by a strong
financial position and

JPR, together with TRIM and its PMs, will continue
to focus on improving the occupancy rates of theoffice buildings in its portfolio.

future prospects, JPR isconfident in its potential
to grow into a morecompetitive position in
the marketplace. The

These renovations should be completed inCompany is supported in these efforts byMarch 2004.

TRIM, an innovative asset managementcompany working to maximize investment

Proactive Asset Management

value. JPR looks forward to the continued

JPR, together with TRIM and its PMs, will

support and understanding of all its

continue to focus on improving the occu-

investors.

pancy rates of the office buildings in its
portfolio. JPR will also engage in activities
to retain existing tenants in office buildings.
Moreover, by inputting the comments andHirohito Kaneko, Executive Officer,
Japan Prime Realty Investment Corporation

requests of existing tenants into a databaseand reflecting them in property management evaluations, JPR encourages PMs to
improve their operations and tenant

8

Toshihiro Hagiwara, President and CEO,Tokyo Realty Investment Management, Inc.

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 9

SUBSEQUENT ACTIVITY HIGHLIGHTS

Property Acquisitions

Doujima F Building
Located in the Kita-ku area of Osaka city a two-minute walk from Nishi-Umeda
Station, Yotsubashi Subway Line, this office building replete with parking facilities
houses the GEOS Corporation.

Location: Osaka, Osaka
Acquisition Date: January 23, 2004
Acquisition Price: ¥2,140 million

Kawaguchi Center Building
On February 13, 2004 JPR acquired the Kawaguchi Center Building situated in
Saitama Prefecture some three-minutes walk from Kawaguchi Station, JR Keihin
Tohoku Line. Consisting primarily of office space and attendant parking facilities,
major tenants in this property are Media Communications Co., Ltd. and the Japan
Science and Technology Agency.
Location: Kawaguchi-shi, Saitama
Acquisition Date: February 13, 2004
Acquisition Price: ¥8,100 million

SEF Building
Major tenants in this office space situated only four minutes on foot from Inaricho
Station, Eidan Ginza Subway Line include Kubota Environmental Service Co., Ltd.
and Bandai Visual Co., Ltd. Facilities include shops and parking area.

Location: Taito-ku, Tokyo
Acquisition Date: March 1, 2004
Acquisition Price: ¥3,250 million

Issue of Corporate Bonds
On January 29, 2004 JPR announced pricing of its Unsecured Corporate Bonds. The Company’s three series of unsecured bonds, totaling ¥22.0 billion, were available for subscription from January 29, 2004. The bonds were rated at A-,
A+, and A3 by Standard & Poors, Rating and Investment Information, Inc., and Moody’s Investors Service, respectively.

9JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 10

PROPERTY PORTFOLIO OF JPR

Locations of Portfolio Properties
A Tokyo CBDs
Office A-5

Shinjuku-ku

Office A-4
Chiyoda-ku

Shibuya-ku

Retail A-1

Office A-6

Hokkaido

Office A-3

C – 10 11

Office A-1
Office A-2
Office A-8

Chuo-ku

Minato-ku
Shinagawa-ku

Office A-7

B Greater Tokyo
SaitamaC – 12
Office B-1

Retail B-1

TohokuTokyo

Office B-4
Kanagawa Retail B-2
Office B-5
Office B-3

Office B-2

Hokuriku
C – 1

Chiba

B

ChugokuA

C – 15

C – 2
C – 5

Shikoku

KyushuC – 7

8

C – 16 Chubu

Osaka

6

3

4

1

C – 13

Kinki

14

A

Tokyo CBDs

Chiyoda, Chuo, Minato, Shinjuku,
Shinagawa, Shibuya

B

Greater Tokyo

All other areas of Tokyo and Chiba
Prefecture, Kanagawa Prefecture,
Saitama Prefecture

C

Other Cities

All other areas in JapanC – 9

Okinawa10

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 11

A Tokyo CBDs
■

■ A-1
■ A-2
■ A-3
■ A-4
■ A-5
■ A-6
■ A-7
■ A-8
● A-1

Kanematsu Bldg.
Kanematsu Bldg. Annex
JPR Ningyo-cho Bldg.
Shin-Kojimachi Bldg.
Crest Yasuda Bldg.
MS Shibaura Bldg.
Gotanda First Bldg.
Fukuoka Bldg.
Jinnan 1-chome Bldg. (Retail)

B Greater Tokyo
■

■ B-1
■ B-2
■ B-3
● B-1
● B-2
■ B-4
■ B-5

Arca East
JPR Chiba Bldg.
Asahi-Life Yokohama Nihon Odori Bldg.
Tanashi ASTA (Retail)Tsurumi fuga 1 (Retail)JPR Ikebukuro Bldg.
Shinyokohama 2nd Center Bldg.

C Other Cities—Hokkaido, Tohoku and Hokuriku■■ C-10■ C-11■ C-12■ C-1

North 33 Bldg.
Park East Sapporo
Sompo Japan Sendai Bldg.
Niigata Ekinan Center Bldg.

C Other Cities—Chubu, Osaka, Kinki, Chugoku and Shikoku■■ C-16
■ C-2
■ C-3
■ C-4
■ C-13■ C-15
■ C-5
■ C-6
● C-1

Nagoya Kowa Bldg.
Meiji Yasuda-Life Osaka Umeda Bldg.
Yasuda-Life Tenroku Bldg.
Tokyo Tatemono Honmachi Bldg.
Sompo Japan Wakayama Bldg.
SK Hiroshima Bldg.
Asahi-Life Takamatsu 2nd Bldg.
JPR Takamatsu Bldg.
Kuraray Nissay Bldg. (Retail)

C Other Cities—Kyushu and Okinawa
■

■ C-7
■ C-8
■ C-14■ C-9

JPR Hakata Bldg.
Asahi-Life Fukuoka 3rd and 4th Bldg.
Tenjin 121 Bldg.
JPR Naha Bldg.

11

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 12

Tokyo CBDs

Region

Type

No.

Name

Location

Completed

Acquired

Greater Tokyo(millions of yen)(millions of yen)

Ownersh(%)

A-1

Kanematsu Bldg.

Chuo-ku, Tokyo

1993. 2

2001.12.27

16,27611.6%

14,10079.4

OfficeA-2

Kanematsu Bldg. Annex

Chuo-ku, Tokyo

1993. 2

2001.12.27

2,874

2.1%

2,500

79.4

OfficeA-3

JPR Ningyo-cho Bldg.

Chuo-ku, Tokyo

1989.122001.11.16

2,100

1.5%

1,870

100.

OfficeA-4

Shin-Kojimachi Bldg.

Chiyoda-ku, Tokyo

1984.10

2001.11.16
2002.11.21(Total)

1,670
550

1.2%
0.4%

1,526
654

49.
21.

OfficeA-5

Crest Yasuda Bldg.

Chiyoda-ku, Tokyo

1999. 92002. 6.21

4,000

2.9%

3,250

100.

OfficeA-6

MS Shibaura Bldg.

Minato-ku, Tokyo

1988. 2

2003. 3.28

11,2008.0%

11,70036.

OfficeA-7

Gotanda First Bldg.

Shinagawa-ku, Tokyo

1989. 7

2003. 7.23

2,920

2.1%

2,920

61.8

OfficeA-8

Fukuoka Bldg.

Chuo-ku, Tokyo

1990. 5

2003.10.15

1,800

1.3%

1,800

14.3

RetailA-1

Jinnan 1-chome Bldg.

Shibuya-ku, Tokyo

1992. 2

2003. 6.30

12,000

8.6%

12,000100.

55,39039.7%

52,320

OfficeB-1

Arca East

Sumida-ku, Tokyo

1997. 3

2001.11.16

5,880

4.2%

5,900

41.

OfficeB-2

JPR Chiba Bldg.

Chiba, Chiba

1991. 1

2001.12.13

2,350

1.7%

2,181

100.

OfficeB-3

Asahi-Life Yokohama Nihon Odori Bldg.

Yokohama, Kanagawa

1989.10

2001.11.16

2,927

2.1%

2,816

100.

OfficeB-4

JPR Ikebukuro Bldg.

Toshima-ku, Tokyo

1980.10

2002. 6.21

2,040

1.5%

2,110

100.

OfficeB-5

Shinyokohama 2nd Center Bldg.

Yokohama, Kanagawa

1991. 8

2002. 9.25

920

0.6%

1,020

50.

RetailB-1

Tanashi ASTA

Nishitokyo, Tokyo

1995. 2

2001.11.16

10,2007.3%

10,840RetailB-2

Tsurumi fuga 1

Yokohama, Kanagawa

1985. 92001.11.16

3,040

2.2%

3,188

27,357

19.6%

28,055

Total

Other Cities

Appraisal
Value%of total

Office

Total

42.

64.4

OfficeC-1

Niigata Ekinan Center Bldg.

Niigata, Niigata

1996. 3

2001.11.16

2,140

1.5%

2,086

52.

OfficeC-2

Meiji Yasuda-Life Osaka Umeda Bldg.

Osaka, Osaka

2000. 6

2001.12.25

8,300

5.9%

8,600

33.3

OfficeC-3

Yasuda-Life Tenroku Bldg.

Osaka, Osaka

1991. 6

2001.11.16

—

—%

—

OfficeC-4

Tokyo Tatemono Honmachi Bldg.

Osaka, Osaka

1970. 2

2001.11.16

4,150

3.0%

4,210

64.3

OfficeC-5

Asahi-Life Takamatsu 2nd Bldg.

Takamatsu, Kagawa

1981. 8

2001.11.16

872

0.6%

740

100.

OfficeC-6

JPR Takamatsu Bldg.

Takamatsu, Kagawa

1982. 92001.12.18

2,130

1.5%

1,330

100.

OfficeC-7

JPR Hakata Bldg.

Fukuoka, Fukuoka

1985. 6

2001.11.16

2,900

2.1%

2,700

100.

OfficeC-8

Asahi-Life Fukuoka 3rd and 4th Bldg.

Fukuoka, Fukuoka

1984. 2 (3rd)2001.11.16
1986.10 (4th)

2,873

2.1%

2,730

100.

OfficeC-9

JPR Naha Bldg.

Naha, Okinawa

1991.10

2001.11.16

1,560

1.1%

1,580

100.

Office

C-10

North 33 Bldg.

Sapporo, Hokkaido

1992. 2

2002. 6.18

3,700

2.6%

3,130

100.

Office

C-11

Park East Sapporo

Sapporo, Hokkaido

1985.11

2002. 6.18

2,150

1.5%

2,070

100.

OfficeC-12

Sompo Japan Sendai Bldg.

Sendai, Miyagi

1997.12

2002. 6.26

3,150

2.3%

3,200

100.

OfficeC-13

Sompo Japan Wakayama Bldg.

Wakayama, Wakayama

1996. 7

2002. 6.26

1,670

1.2%

1,670

100.

OfficeC-14

Tenjin 121 Bldg.

Fukuoka, Fukuoka

2000. 7

2002. 6.21

2,810

2.0%

2,660

52.

Office

C-15

SK Hiroshima Bldg.

Hiroshima, Hiroshima

1989.12

2002.10. 4

947

0.7%

925

100.

Office

C-16

Nagoya Kowa Bldg.

Nagoya-shi, Aichi

building 2003. 1
parking 1986.12

2003. 9. 1

4,550

3.3%

4,605

100.

RetailC-1

Kuraray Nissay Bldg.

Osaka, Osaka

1990. 4

2003. 5.15

13,0009.3%

12,600100.

56,90238.0%

54,836

139,649

100.0%

135,211

Total
Total
Note 1: Acquisition price does not include miscellaneous expenses of acquisition (real estate agent’s fee and consumption tax)
Note 2: Percentages and ratios are rounded to the first decimal point

12

AcquisitionPriceJPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 13

Acquisition
Price

Appraisal
Value

Total Leasable
Floor Space (m2)

Total Leased
Floor Space (m2)

(JPR’s portion)

1,751.13

79.4%

1,870

100.0%

1.2%
0.4%(1.6%)

1,526
654(2,180)

49.0%

4,000

2.9%

28

11,20023(millions of yen)%of total

Ownership

Site Area

(%)

(m2)

(JPR’s portion)

Occupancy
Rate

# of
Tenants(millions of yen)27

16,27611.6%

14,10079.4%

7,958.58

7,757.74

97.5%

27

2,874

2.1%

2,500

679.06

2,291.13

2,291.13

16

2,100

1.5%

550.062,784.78

16
21

1,670
550
(2,220)

21.0%

21

3,250

8.0%

2,920

15

30

RentalRevenue(thousands of yen)%of total

11411,689

6.6%

100.0%

1

104,309

1.7%

2,784.78

100.0%

4

105,200

1.7%

1,725.02

657.802,105.44
901.36(3,006.80)

901.3681.9%
100.0%(87.3%)

7
3(10)

67,091
31,467(98,558)

1.1%
0.5%(1.6%)

100.0%

636.903,265.34

3,265.34

100.0%

9

100,841

1.6%

11,70036.0%

8,992.18

14,429.08

12,467.70

86.4%

6

570,232

9.1%

2.1%

2,920

61.8%

1,151.19

4,240.98

4,240.98

100.0%

4

130,125

2.1%

1,800

1.3%

1,800

14.3%

1,302.17

1,250.06

1,250.06

100.0%

1

27,4660.4%

12,000

8.6%

12,000100.0%

1,010.47

8,076.85

8,076.85

100.0%

1

345,576

5.5%

55,39039.7%

52,32017,130.96

47,303.60

44,760.96

94.6%

47 1,893,996

30.3%

16

5,880

4.2%

5,900

41.1%

3,755.01

7,050.10

6,017.59

85.4%

4354,111

5.7%

13

2,350

1.7%

2,181

100.0%

1,382.35

5,558.06

4,923.77

88.6%

27

161,247

2.6%

16

2,927

2.1%

2,816

100.0%

1,100.59

6,066.54

5,748.33

94.8%

10

145,375

2.3%

21

2,040

1.5%

2,110

100.0%

772.77

4,597.35

3,531.96

76.8%

699,227

1.6%

25

920

0.6%

1,020

50.0%

841.712,640.80

2,176.23

82.4%

973,3181.2%

31,121.71

31,121.71

100.0%

1

672,182

10.7%

1,962.18

9,578.60

9,578.60

100.0%

1

153,279

2.4%

22,140.91

66,613.16

63,098.19

94.7%

58 1,658,739

26.5%

d

16

10,2007.3%

10,84042.1% (land)
52.9% (building) 12,326.30

16

3,040

2.2%

3,188

64.4%

27,357

19.6%

28,055

16

2,140

1.5%

2,086

52.7%

2,706.99

5,206.82

5,206.82

100.0%

16

136,216

2.2%

25

8,300

5.9%

8,600

33.3%

5,999.33

9,588.16

9,588.16

100.0%

20

393,185

6.3%

16

—

—%

—

—

—

—

—

—

—

21,953

0.4%

16

4,150

3.0%

4,210

64.3%

1,432.64

7,210.25

7,106.76

98.6%

10

262,630

4.2%

16

872

0.6%

740

100.0%

579.992,518.30

1,930.10

76.6%

20

53,007

0.9%

18

2,130

1.5%

1,330

100.0%

1,407.78

5,032.29

3,426.37

68.1%

20

96,434

1.5%

16

2,900

2.1%

2,700

100.0%

1,214.63

6,571.89

6,077.04

92.5%

27

160,456

2.6%

16

2,873

2.1%

2,730

100.0%

2,500.86

8,439.77

7,691.27

91.1%

15

194,243

3.1%

16

1,560

1.1%

1,580

100.0%

959.87

3,947.07

3,841.57

97.3%

14

121,493

1.9%

18

3,700

2.6%

3,130

100.0%

1,382.12

6,643.01

4,506.66

67.8%

18

115,118

1.8%

18

2,150

1.5%

2,070

100.0%

1,808.26

7,646.76

5,936.29

77.6%

24

115,462

1.9%

26

3,150

2.3%

3,200

100.0%

1,895.67

7,047.24

6,937.29

98.4%

9

206,707

3.3%

26

1,670

1.2%

1,670

100.0%

1,128.45

4,892.17

4,892.17

100.0%

16

130,990

2.1%

21

2,810

2.0%

2,660

52.2%

1,164.39

3,292.02

2,199.40

66.8%

994,133

1.5%

4

947

0.7%

925

100.0%

502.412,732.29

2,135.81

78.2%

15

58,532

0.9%

1

4,550

3.3%

4,605

100.0%

992.31

5,461.90

4,929.86

90.3%

18

127,7722.0%

15

13,0009.3%

12,600100.0%

3,518.68

18,586.97

18,586.97

100.0%

1

410,329

6.6%

56,90238.0%

54,83629,194.38

104,817.91

94,992.54

90.6%

252 2,697,660

43.2%

139,649

100.0%

135,211

68,466.25

218,734.67

202,851.69

92.7%

357 6,250,395

100.0%

13

JPR-第四期 P1-20 4/5 04.4.8 9:55 PM ページ 14

OVERVIEW OF PORTFOLIO PROPERTIES(As of December 31, 2003)

Tokyo CBDs
A -■
1
■

Chuo-ku, Tokyo

Kanematsu Bldg.

Chuo-ku, Tokyo

Kanematsu Bldg. Annex
Acquisition Price(millions of yen):

2,874% of Total:

2.1%

Site Area:

679.06(m2)

Total Floor Space

A -■
2
■

: 4,351.46(m2)

Structure/Floors:

SRC
B1/8F

Completed:February
1993

Chuo-ku, Tokyo

JPR Ningyo-cho Bldg.
Acquisition Price(millions of yen):

2,100% of Total:

1.5%

Site Area (m2):550.06A -■3■

Total Floor Space (m2): 4,117.70

Acquisition Price (millions of yen):

Structure/Floors:

SRC/RC
B1/8F

Completed:

December
1989

16,276% of Total:

11.6%

Site Area (m2):

1,751.13

Total Floor Space (m2):

14,995.09

Structure/Floors:

S/RC/SRC B2/13F

Completed:February 1993

Note 1: Acquisition price does not include miscellaneous expenses(real estate agent’s fee and consumption tax)
Note 2: Percentages and ratios are rounded to the first decimal point
Note 3: Abbreviations under “Structure/Floors” indicate S: Steelframe, RC: Reinforced concrete, and SRC: Steel-frame reinforced concrete14

JPR-第四期 P1-20 4/5 04.4.8 9:56 PM ページ 15

Chiyoda-ku, Tokyo

Shin-Kojimachi Bldg.

A -■
4
■

Chiyoda-ku, Tokyo

Crest Yasuda Bldg.

Acquisition Price(millions of yen):

2,220

Acquisition Price(millions of yen):

4,000% of Total:

1.6%% of Total:

2.9%

Site Area (m2):

657.80Site Area (m2):

636.90Total Floor Space (m2): 5,152.98

Total Floor Space (m2): 4,790.68

Structure/Floors:

SRC
B1/9F

Structure/Floors:

SRC
B1/9F

Completed:

October
1984

Completed:

September
1999

Minato-ku, TokyoMS Shibaura Bldg.

A -■
6
■

Shinagawa-ku, Tokyo

Gotanda First Bldg.

Acquisition Price(millions of yen):

11,200Acquisition Price(millions of yen):

2,920% of Total:

8.0%% of Total:

2.1%

8,992.18

Site Area

Site Area:(m2)

Total Floor Space:: 31,020.21

Total Floor Space

SRC/RC/S
B2/13F

Structure/Floors:

SRC/RC
B2/11F

Completed:February
1988

Completed:

July
1989

A -■
8
■

Chuo-ku, Tokyo

Fukuoka Bldg.
Acquisition Price(millions of yen):

1,800% of Total:

1.3%

Site Area (m2):

1,302.17

Total Floor Space (m2): 11,627.74
Structure/Floors:

SRC
B2/10F

Completed:May 1990

A -■7■1,151.19(m2)

Structure/Floors:

(m2)

A -■
5
■

: 10,553.34(m2)

Shibuya-ku, Tokyo

Jinnan 1-chome Bldg.
Acquisition Price(millions of yen):

12,000% of Total:

8.6%

Site Area (m2):

1,010.47

A -●1 (Retail)■

Total Floor Space (m2): 8,449.56
Structure/Floors:

SRC/S
B3/8F

Completed:February
1992

15

JPR-第四期 P1-20 4/5 04.4.8 9:56 PM ページ 16

Greater Tokyo
B -■
1
■

Sumida-ku, Tokyo

Arca East
Acquisition Price(millions of yen):

5,880% of Total:

4.2%

Site Area (m2):

3,755.01

B -●1 (Retail)■Nishitokyo, Tokyo

Tanashi ASTA

Total Floor Space (m2): 34,281.86
Structure/Floors:

S/SRC
B3/19F

Completed:

March
1997

Chiba, Chiba

JPR Chiba Bldg.
Acquisition Price(millions of yen):

2,350% of Total:

1.7%

Site Area (m2):
Total Floor Space

Completed:

January
1991

Yokohama, Kanagawa

Asahi-Life Yokohama Nihon Odori Bldg.

16

2,927

% of Total:

2.1%

Site Area (m2):

1,100.59

7.3%

(m2)

12,326.30

Total Floor Space (m2):80,675.27

Structure/Floors:

SRC B2/17F

Completed:February 1995

Site Area:

B -●2 (Retail)■Tsurumi fuga 1: 9,072.57
S/SRC
B1/13F

10,200

Yokohama, Kanagawa

1,382.35(m2)

Structure/Floors:

Acquisition Price(millions of yen):

B -■
2
■

Acquisition Price (millions of yen):% of Total:

B -■
3
■

Acquisition Price (millions of yen):

3,040% of Total:

2.2%

Site Area (m2):
Total Floor Space

1,962.18:(m2)

13,543.32

Total Floor Space (m2): 9,146.52

Structure/Floors:

SRC B2/7F

Structure/Floors:

SRC
B1/11F

Completed:

September 1985

Completed:

October1989

JPR-第四期 P1-20 4/5 04.4.8 9:56 PM ページ 17

Toshima-ku, Tokyo

JPR Ikebukuro Bldg.

B -■
4
■

Yokohama, Kanagawa

Shinyokohama 2nd Center Bldg.

Acquisition Price(millions of yen):

2,040

Acquisition Price(millions of yen):920% of Total:

1.5%% of Total:

0.6%

772.77Site Area

Site Area:(m2)

Total Floor Space

:841.71(m2): 6,468.08

Total Floor Space

Structure/Floors:

SRC
B1/9F

Structure/Floors:

S/SRC
B2/12F

Completed:

October
1980

Completed:

August
1991

(m2)

B -■
5
■

: 7,781.93(m2)

Other Cities — Hokkaido, Tohoku and Hokuriku
C -■
10
■

Sapporo, Hokkaido

North 33 Bldg.

Sapporo, Hokkaido

Park East Sapporo

Acquisition Price(millions of yen):

3,700

Acquisition Price(millions of yen):

2,150% of Total:

2.6%% of Total:

1.5%

Site Area (m2):

1,382.12

Site Area (m2):

1,808.26

Total Floor Space (m2): 10,568.23

Total Floor Space (m2): 10,865.75

Structure/Floors:

SRC
B1/12F

Structure/Floors:

SRC
B1/8F

Completed:February
1992

Completed:

November
1985

Sendai, Miyagi

Sompo Japan Sendai Bldg.

C -■
12
■

Niigata, Niigata

Niigata Ekinan Center Bldg.

Acquisition Price(millions of yen):

3,150

Acquisition Price(millions of yen):

2,140% of Total:

2.3%% of Total:

1.5%

1,895.67

Site Area

Site Area:(m2)

Total Floor Space

:

C -■
1
■

2,706.99(m2): 10,783.52

Total Floor Space

Structure/Floors:

SRC
B1/12F

Structure/Floors:

S/SRC
B1/10F

Completed:

December
1997

Completed:

March
1996

(m2)

C -■
11
■

: 19,950.42

(m2)

17

JPR-第四期 P1-20 4/5 04.4.8 9:56 PM ページ 18

Other Cities — Osaka
Osaka, Osaka

Meiji Yasuda-Life Osaka Umeda Bldg.

C -■
2
■

Osaka, Osaka

Yasuda-Life Tenroku Bldg.
Acquisition Price(millions of yen):418% of Total:—%

Site Area (m2):642.06C -■3■

Total Floor Space (m2): 3,851.23
Structure/Floors:

SRC
B1/8F

Completed:

June 1991

Note: JPR sold the Yasuda-Life Tenroku
Building on September 3, 2003 for¥609 million.

Osaka, Osaka

Tokyo Tatemono Honmachi Bldg.
Acquisition Price(millions of yen):

4,150% of Total:

3.0%

Site Area (m2):

1,432.64

C -■4■

Total Floor Space (m2): 14,619.52

Acquisition Price (millions of yen):

8,300% of Total:

5.9%

Site Area (m2):5,999.33

Total Floor Space (m2):

52,982.94

Structure/Floors:

S/SRC B2/31F

Completed:

June 2000

Structure/Floors:

SRC
B3/9F

Completed:February
1970

Osaka, Osaka

Kuraray Nissay Bldg.
Acquisition Price(millions of yen):

13,000% of Total:

9.3%

Site Area:

Total Floor Space

18

3,518.68(m2): 17,897.56(m2)

Structure/Floors:

SRC
B1/8F

Completed:

April
1990

C -●
1 (Retail)■JPR-第四期 P1-20 4/5 04.4.8 9:57 PM ページ 19

Other Cities — Chubu, Kinki, Chugoku and Shikoku
Wakayama, Wakayama

Sompo Japan Wakayama Bldg.

C -■
13
■

Hiroshima, Hiroshima

SK Hiroshima Bldg.

Acquisition Price(millions of yen):

1,670

Acquisition Price(millions of yen):947% of Total:

1.2%% of Total:

0.7%

1,128.45

Site Area

Site Area:(m2)

Total Floor Space:502.41(m2): 6,715.07

Total Floor Space

Structure/Floors:

S 9F

Structure/Floors:

SRC B1/9F

Completed:

July 1996

Completed:

December
1989

(m2)

Takamatsu, Kagawa

Asahi-Life Takamatsu 2nd Bldg.

C -■
5
■

: 4,268.70(m2)

Takamatsu, Kagawa

JPR Takamatsu Bldg.

Acquisition Price(millions of yen):872

Acquisition Price(millions of yen):

2,130% of Total:

0.6%% of Total:

1.5%

Site Area (m2):

579.99Site Area (m2):

1,407.78

Total Floor Space (m2): 3,471.55

Total Floor Space (m2): 7,409.08

Structure/Floors:

SRC 8F

Structure/Floors:

Completed:

August1981

SRC
B1/10F

Completed:

September
1982
March
1984
(extension)

Nagoya-shi, Aichi

Nagoya Kowa Bldg.
Acquisition Price(millions of yen):

C -■
15
■

C -■
6
■

C -■
16
■

4,550

% of Total:

3.3%

Site Area (m2):

992.31

Total Floor Space (m2): 7,261.65
Structure/Floors:
Parking:
Completed:
Building:
Parking:S
B1/11F
S 1F
January
2003
December
1986

19

JPR-第四期 P1-20 4/5 04.4.8 9:57 PM ページ 20

Other Cities — Kyushu and Okinawa
Fukuoka, Fukuoka

JPR Hakata Bldg.
Acquisition Price(millions of yen):

2,900% of Total:

2.1%

Site Area:

1,214.63(m2)

Total Floor Space

C -■
7
■

: 9,791.91(m2)

Structure/Floors:

S/RC
B1/12F

Completed:

June
1985

C -■
8
■

Fukuoka, Fukuoka

Asahi-Life Fukuoka 3rd and 4th Bldg.
Acquisition Price(millions of yen):

2,873% of Total:

2.1%

Site Area:

2,500.86(m2)

Total Floor Space

: 7,683.01
(3rd)

(m2)

Structure/Floors:

Completed:

SRC
B1/10F(3rd)
February
1984
(3rd)

Fukuoka, Fukuoka

Tenjin 121 Bldg.

20

Total Floor Space (m2): 3,723.68
(4th)

C -■
14
■

Structure/Floors:

SRC 7F(4th)

Completed:

October
1986
(4th)

C -■
9
■

Naha, Okinawa

JPR Naha Bldg.

Acquisition Price(millions of yen):

2,810

Acquisition Price(millions of yen):

1,560% of Total:

2.0%% of Total:

1.1%

Site Area (m2):

1,164.39

Site Area (m2):

959.87

Total Floor Space (m2): 8,690.95

Total Floor Space (m2): 5,780.71

Structure/Floors:

S/SRC
13F

Structure/Floors:

S/SRC
12F

Completed:

July 2000

Completed:

October1991

JPR-第四期 P21-23 4/2 04.4.8 9:53 PM ページ 21

REIT STRUCTURE AND EXTERNAL SERVICE PROVIDERS

Asset Management Company

Advisor on Construction
Management/
Property Transfer AgentTokyo Realty Investment
Management, Inc.

Tokyo Tatemono Co., Ltd.

Asset Management

Tenant Agents

Tokyo Tatemono Co., Ltd.
Yasuda Real Estate Co., Ltd.
Taisei Corporation

Investment Corporation

Japan Prime Realty
Investment Corporation

Liabilities

Loan
Corporate Bonds

LenderCorporate Bond
Investor

AssetsInvestment

Real Estate etc.

Unitholder

Unitholders’ Equity

Cash Distribution

Property Manager

Unitholder

Asset Custodian

Asset Custodian
Mizuho Trust & Banking Co., Ltd.

Tokyo Tatemono Co., Ltd. performs agency services forthe signing of real estate leasing contracts (“generaltenant agency services”) under a commission from theowners of real estate, in order to provide uniform
tenant recruitment and sales services for the Company.
Tokyo Tatemono also has been commissioned by TRIM
to undertake “property transfer services.” Tokyo
Tatemono also provides advice on rental operations

Administrative Agent

Administrative Agent
Mizuho Trust & Banking Co., Ltd.

management and construction planning management
work (“leasing management/construction management services” or “LM /CM services”) to TRIM.
Yasuda Real Estate Co., Ltd. and Taisei Corporation
provide general tenant agency services for real estate,
as commissioned by the trustees.

21

JPR-第四期 P21-23 4/2 04.4.8 9:53 PM ページ 22

making in connection with the acquisition or leasing ofproperties and acting as an agent or broker of suchtransactions based on relevant judgement), (2) services
regarding funding by JPR, (3) reporting to JPR and (4)any other services related to or affiliated with the above(the above services are collectively called “AssetManagement Service” or “AM Service”).

Tokyo Realty Investment Management, Inc.
Tokyo Realty Investment Management, Inc. (“TRIM”)
concluded the asset management contract with JPR on
September 27, 2001. Based on the contract, TRIM provides asset management services as a REITManagement Company under the Investment Trust Law.
TRIM is assigned to provide (1) services regarding
asset management for JPR (including all decision-

Shareholders’ Meeting
Auditors
Board of Directors
C E O
Compliance Committee

Investment Committee
Investment Management
Division

ResearchGroup

Investment
Group

Asset
Management
Group

Corporate Planning/
Administration Division

Financial Division

FinanceGroup

IR Group

FundManagement
Group

AccountingGroup

Shareholders in TRIM (As of December 31, 2003)
Tokyo Tatemono Co., Ltd.

26%
Meiji Yasuda-Life Insurance Company*

24%
Taisei Corporation

20%
Yasuda Real Estate Co., Ltd.

Total

100%

20%
Sompo Japan Insurance Inc.

10%
Note: The Yasuda Mutual Life Insurance Company and Meiji Life Insurance Company
merged on January 1, 2004 to form Meiji Yasuda-Life Insurance Company.

22

Planning/
Human
ResourcesGroup

ComplianceGroupJPR-第四期 P21-23 4/2 04.4.8 9:53 PM ページ 23

Decision-Making Process of Investment Management

The “investment amount” for any real estate or real estate

The “Investment Committee” is set as a committee tomake investment decisions as well as its sub-organizations, the “Investment Subcommittee” and the “FundManagement Subcommittee.” Members of these organizations include the CEO, CIO, CFO, CAO, FundManager, Research Manager, Asset Manager andInvestment Management Manager.
The “Investment Committee” is a committee which
formulates fundamental investment policy for the
medium and long term within two fiscal periods, whilethe “Investment Subcommittee” or “Management
Subcommittee” has charge of decisions on issues
regarding acquisitions, dispositions and managementof individual assets respectively. The Board of Directors
is given the final authorization on acquisitions or dispositions of individual assets of a certain amount.

in trust property must be the appraised value or less(deemed to be the purchase price only, exclusive of taxes
and acquisition costs, etc.). Prior approval of the Board of
Directors of the Company is required. For other designatedassets, the investment amount must be at market prices
for assets for which market prices are available, otherwise
at the appraised value or less.

b) Sales of property or assets to interested parties
The “sales price” for any real estate or real estate in trust
property must be the appraised value or more (deemed tobe sales price only, exclusive of taxes and selling costs,etc.). Prior approval of the Board of Directors of theCompany is required. For other designated assets, thesales price must be at market prices for assets for whichmarket prices are available, otherwise at the appraisedvalue or more.

c) Leasing of properties to interested parties

Measures to Prevent Conflicts of Interest

Properties may be leased to interested parties provided

TRIM has established the “Compliance Committee”
and “Compliance Subcommittee.” The “Compliance
Subcommittee” oversees the aforementioned committees and determines whether their decision-making
activities strictly adhere to laws and regulations.
TRIM has rules in place governing transactions with“related parties” so as to avoid conflicts of interest. The
Compliance Committee serves to prevent transactions
with conflicts of interest based on the advice of an
outside attorney who is a special member of the committee. Related parties are defined as specific parties
with which transactions have been made or to which
commissions or other payments have been made in therelevant term. These include the following parties,
which have an investment in TRIM or employees
serving as directors or staff at TRIM: Tokyo Tatemono
Co., Ltd., The Meiji Yasuda-Life Insurance Company,
Yasuda Real Estate Co., Ltd., Taisei Corporation, Sompo
Japan Insurance Inc. (formerly The Yasuda Fire &Marine Insurance Co., Ltd.) and their affiliates.

that leasing is done under appropriate terms and conditions as determined from the viewpoint of market trends
and standard leasing terms for the property.

d) Property management commissions to interested parties
Commissions are based on the Property Management
Standards. Prior approval of the Board of Directors of theCompany is required.

e) Trading/leasing intermediation fees paid to interested
parties
Trading intermediation fees are limited to up to 3% of the
trading price. Prior approval of the Board of Directors of
the Company is required. Leasing intermediation fees arelimited to the amount equivalent to the contracted rent forone month.

f) Commissioning of construction work to interested parties
Commissions of construction work worth ¥10 million ormore require a comparison against third-party estimatesand proposals. Prior approval of the Board of Directors of
the Company is required.

g) Borrowings from interested parties
Terms of borrowings must be at market levels. Prior

Such measures include:a) Acquisitions of property or assets from interested parties

approval of the Board of Directors of the Company isrequired.

23

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 24

M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A LY S I S

RESULTS OF OPERATIONS
The table below is a summary of business results for the periods ended December 31, 2003 and June 30, 2003.

OPERATING REVENUES
Real estate rental revenues
Rental revenues
Non-rental revenues

thousands of yen

U.S. dollars

4th Period(July 1, 2003–
Dec. 31, 2003)

3rd Period(Jan. 1, 2003–
June 30, 2003)

4th Period(July 1, 2003–
Dec. 31, 2003)¥6,421,099¥5,264,525$59,937,448

6,250,395—

58,344,024—

4,898,820——

365,705—

170,704—

1,593,424

OPERATING EXPENSES

3,487,138

3,018,056

32,550,527

OPERATING PROFITS

2,933,961

2,246,469

27,386,921

Gain on sale of real estate

NON-OPERATING REVENUES

1,329

80,71912,412

NON-OPERATING EXPENSES

466,923

335,842

4,358,478

INCOME BEFORE INCOME TAXES

2,468,367

1,991,346

23,040,855

NET INCOME¥2,467,358¥1,990,377$23,031,436

The Company’s property portfolio as of December 31, 2003,
comprised 32 properties, an increase over the third fiscal
period ended June 30, 2003 of two properties, reflecting threeacquisitions and one divestment. During the period underreview, the Company purchased the Gotanda First Building(unit ownership, investment of ¥2,920 million) on July 23, theNagoya Kowa Building (investment of ¥4,550 million) on September 1, and the Fukuoka Building (co-ownership of theland and partial unit ownership of the building, investment of¥1,800 million). Another highlight during the six-month period
was the increase in ownership in the Kuraray Nissay Building
to 100%. In the area of divestitures, JPR sold its interest in the
Yasuda-Life Tenroku Building for ¥600 million on September
3, 2003 securing a healthy capital gain. Although not currently
a major strategy in the Company’s overall business activities,
the sale of the Yasuda-Life Tenroku Building is a prime example of JPR’s efforts to enhance value through effective renovation and upgrade of select properties within its portfolio andto generate an additional revenue source through sale.
Operating revenues for the six months ended December
31, 2003 rose 22.0%, or ¥1,157 million, to ¥6,421 million andcomprised mainly real estate rental revenues and a ¥171
million gain on sale of real estate (the Yasuda-Life Tenroku
Building). Operating expenses, including real estate rental
expenses of ¥2,996 million, totaled ¥3,487 million, an increaseof 15.5% from the third fiscal period. As a result, operating
profits increased 30.6%, to ¥2,934 million from ¥2,246 million
in the previous period. In non-operating revenues andexpenses, the Company recorded new unit issuance costs
and interest expense rose as a result of an increase in borrowings for the acquisition of new properties. Non-operating
revenues decreased substantially due to the absence ofadministrative cooperative account revenues. Nevertheless,income before income taxes increased 24.0% to ¥2,468
million and net income also rose 24.0% to ¥2,467 million.

CASH DISTRIBUTIONS
The cash distribution per unit for the period ended December
31, 2003, was ¥5,738. The amount of the cash distribution
per unit was affected by the issue of an additional 140,400

investment units during the fiscal period under review. With
430,000 units outstanding, total cash distributions were¥2,467 million.
thousands of yen except per unit data

Cash distributions for theperiod ended Dec. 31, 2003

Cash distributions for theperiod ended June 30, 2003

Net income¥2,467,358¥1,990,377

Total cash distributions

2,467,340

1,990,421

5,738

6,873

Cash distribution per unit24

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 25

CAPITALIZATION
Equity and Debt Financing
In its fourth fiscal period, JPR procured funds totaling ¥32.13
billion through the issue of 140,400 additional investment
units, and continued with efforts to enhance borrowing
capacity and to reinforce its financial position. Based on its
fundamental policy to secure financial stability, the Company
procured funds with the aim of steadily expanding its property
portfolio. As a result, the balance of total outstanding debt asof December 31, 2003 stood at ¥52.47 billion, down from ¥69.5
billion at the previous period-end. In an effort to reduce exposure to the risk of potential increases in interest rates, 75.4%of this amount is fixed interest long-term debt with a maturityof more than one year (average maturity 4.6 years). The
average interest rate during the fiscal period ended
December 31, 2003 was 1.3%. The interest-bearing debt ratio
was 37.1%, and the interest-bearing liabilities to total assets
ratio was 33.5%. The Company considers itself to be well
positioned to increase borrowings as required.

Paid-In Capital
For the fourth fiscal period, ended December 31, 2003, theCompany reported net income of ¥2,467 million and total
unitholders’ equity of ¥91,581 million, with 430,000 units outstanding. (See page 35 and Notes to Financial Statements)
Market Price
The Company was listed on the Tokyo Stock Exchange in June
2002 under the securities code 8955. The high and low closing prices for the periods indicated in the table below were:
yen

Month

June 2002
July 2002
Aug. 2002
Sept. 2002
Oct. 2002
Nov. 2002
Dec. 2002
Jan. 2003
Feb. 2003
Mar. 2003
Apr. 2003
May 2003
June 2003
July 2003
Aug. 2003
Sept. 2003
Oct. 2003
Nov. 2003
Dec. 2003

High

Low

202,000
203,000
205,000
205,000
219,000
240,000
240,000
239,000
227,000
229,000
249,000
283,000
271,000
255,000
251,000
254,000
265,000
270,000
268,000

199,000
200,000
202,000
203,000
203,000
215,000
225,000
220,000
219,000
217,000
227,000
246,000
222,000
234,000
241,000
240,000
251,000
260,000
260,000

Credit Ratings
On October 29, 2003, Standard & Poors assigned its “A-”long-term and “A-2” short-term corporate credit ratings on
JPR and assessed the Company’s outlook as “stable.” In
addition, on January 23, 2004, Moody’s Investor Service
assigned its “A3” long-term corporate credit rating on JPR
and assessed the Company’s outlook at “stable.”

Investment performance of JPR since its IPO on June 14, 2002
Performance (%)

Unit Price (yen)JPR Unit Price Performance (left scale)140

300,000

TOPIX Performance (left scale)130

275,000

JPR Unit Price (right scale)120
250,000
110
225,000
100
200,00090

175,000

80
70
2002/6150,000
7

8

9

10

11

12 2003/1 2

3

4

5

6

7

8

9

10

11

12

25

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 26

Borrowings

Category

Drawdown
Date

LenderBalance as ofDec. 31, 2003
(thousands of yen)Sept. 25, 2002
Sept. 30, 2002
Aozora Bank, Ltd.
Short-Term
Borrowings
Resona Bank, Ltd.
Mizuho Corporate Bank, Ltd.

—

Average
Interest
Rate

RepaymentDate¥ 1,930,000

0.579%

Sept. 25, 2003
Mar. 27, 2004

Mar. 28, 2003

3,770,000

3,770,000

0.935%

May 15, 2003—

8,000,000

0.929%

May 14, 2004

Sep. 1, 2003

2,400,000—

0.829%

Feb. 27, 2004
Mar. 27, 2004

Oct. 15, 2003

1,800,000—

0.838%

Mar. 28, 2003

3,000,000

3,000,000

0.935%

Mar. 27, 2004

Sep. 25, 2003

1,930,000—

0.849%

Mar. 27, 2004

0.810%

Jul. 31, 2003

Jun. 30, 2003

Total

Long-Term
Borrowings¥

Balance as ofJun. 30, 2003
(thousands of yen)—

12,800,000¥12,900,000¥29,500,000

The Chuo Mitsui Trust andBanking Company, Limited

Dec. 27, 2001

10,000,000

10,000,000

1.234%

Dec. 27, 2006

SumitomoLife Insurance Company

Dec. 27, 2001

10,000,000

10,000,000

1.234%

Dec. 27, 2006

Resona Bank, Ltd.

Jun. 19, 2002

2,000,000

2,000,000

1.295%

Dec. 27, 2006

Aozora Bank, Ltd.

Jun. 19, 2002

3,000,000

3,000,000

1.295%

Dec. 27, 2006

Dec. 27, 2001

4,783,000

5,000,000

1.700%

Dec. 26, 2008

Jun. 21, 2002

4,783,000

5,000,000

2.050%

Jun. 21, 2011

Mar. 28, 2003

5,000,000

5,000,000

1.750%

Mar. 28, 2013

Meiji YasudaLife Insurance Company
Total¥39,566,000¥40,000,000

Total Borrowings Balance¥52,466,000¥69,500,000

Repayment
MethodRemarks

Principal
lump sum
repayment
on maturity

Secured/
Unguaranteed/
Non-subordinatedPrincipal
lump sum
repayment
on maturity

Secured/
Unguaranteed/
Non-subordinated

MAJOR TENANTS
The following table shows JPR’s top ten tenants by leased
floor space as of December 31, 2003. The Company has contracted a special type of long-term lease agreement with its
largest tenant, Seiyu, for 20-year periods in the two buildings
it occupies, until February 2015 (Tanashi ASTA) and December 2005 (Tsurumi fuga 1). Ordinary building leases in Japanare contracted for relatively short periods (generally two
years), and renew automatically unless either party gives
notice to the contrary. Such leases also typically allow thetenant to terminate the lease before expiry of the term,
without penalty, with six months prior written notice. The#
1

Tenantleases with Seiyu, however, prohibit termination by the tenant
before expiry of the term, and contain provisions requiring
payment of damages equivalent to the rental amount for theremainder of the contract period should the lease be broken.
JPR continues to strengthen its portfolio by broadening its
tenant base and increasing the percentage of long-term lease
contracts. Specifically, in July 2003, the Company signed along-term lease with Tower Records Japan Inc. (following
acquisition of the Jinnan 1-chome Building). This followed thecontract with The Loft, Co., Ltd. (in connection acquisition of
the Kuraray Nissay Building).

The Loft Co., Ltd.

3

TOWER RECORDS JAPAN INC.

%

40,700.31

20.2

Kuraray Nissay Bldg.

18,586.97

9.2

Jinnan 1-chome Bldg.

8,076.85

4.0

6,701.25

3.3

Property
Tanashi ASTA

The Seiyu, Ltd.

2

Leased Floor Space(m2)

Industry

RetailCasualty Insurance

Tsurumi fuga 1

Sompo Japan Sendai Bldg.

4

Sompo Japan Insurance Inc.

5

Iwatani International Corporation

WholesaleTokyo Tatemono Honmachi Bldg.

5,959.86

2.9

6

Tohmatsu & Co.

Accounting Firm

MS Shibaura Bldg.

5,884.10

2.9

5,395.29

2.7

Arca East

3,993.50

2.0

MS Shibaura Bldg.

3,922.74

1.9

3,094.50

1.5

Sompo Japan Wakayama Bldg.

JPR Ikebukuro Bldg.
Meiji Yasuda-Life Osaka Umeda Bldg.
7

Meiji Yasuda Life Insurance Company

Life Insurance

JPR Naha Bldg.
Niigata Ekinan Center Bldg.
Shinyokohama 2nd Center Bldg.

8

Japan Future Information Technology &Systems Co., Ltd.

9

Mitsubishi Electric Information Systems
Corporation

Other Services

Electronics and Electric Appliances
10

26

Kanematsu Electronics Ltd.

Kanematsu Bldg.
Kanematsu Bldg. AnnexJPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 27

CAPITAL EXPENDITURES
Planned Capital Expenditures
Principal capital expenditures during the period under review
relating to repair and renovation of properties and entrusted
properties in the Company’s portfolio as of December 31,
Property

Details

Asahi-Life Takamatsu 2nd Building
JPR Ikebukuro Building
JPR Takamatsu Building
MS Shibaura Building
Asahi-Life Fukuoka 3rd and4th Building

Projected
Construction Period

Projected Construction Costs(millions of yen)

Total Cost

Amount Paid
Duringthe FourthFiscal Period

AmountPaid to Date

Air-cooling package upgrade for all floors

Jan. 2004–Jun. 2004

¥130

—

—

Upgrade: renovation of first floor common area;
renovation of sixth floor common and designated areas;
upgrade of individual air-conditioning systems;
design control work; other maintenance and repairs

Jan. 2004–Apr. 2004

95

—

—

Air-cooling upgradeJan. 2004–Jun. 2004

30

—

—

Installation of emergency power generator

Jan. 2004–Jun. 2004

20

—

—

Renovation of interior common areas

Jan. 2004–Jun. 2004

20

—

—

Capital Expenditures During the Period Under Review
Capital expenditures undertaken during the period underreview are outlined in the following table. Principal expenditures included earthquake proofing (including design) to
improve safety and comply with new earthquake resistancestandards, renovations aimed at maintaining and improving

tenant satisfaction, as well as renovation of common areasand construction of IT-ready floors in order to attract new
tenants. Along with the following, the Company recorded
additional repairs and maintenance expenses totaling ¥193
million.

Details

PeriodTotal(millions of yen)

Renovation of first floor hall, and second to fourth and seventh to ninth floor common
and leasable areas; upgrade of air-conditioning system and individual adjustment;
designer’s supervision; other upgrades and improvements

July 2003–Dec. 2003

¥348

PropertyJPR Ikebukuro Bldg.

2003 are outlined in the following table. The estimated construction amount includes the portion classified as expenses
in the financial statements.

JPR Takamatsu Bldg.
JPR Hakata Bldg.

Renovation of common areas; earth-quake proofing;
upgrade of air-conditioning system

Aug. 2003–Dec. 2003

64

Expansion of mechanical parking facility

Mar. 2003–Nov. 2003

54

Renovation of restrooms on all floors

Aug. 2003–Dec. 2003

35

Renovations: fifth floor, designated areas of the seventh floor,
fifth floor common areas

Park East Sapporo
Shin-Kojimachi Bldg.
Other Capital Expenditures

Aug. 2003–Dec. 2003

27

Renovations to common areas; installation of OA, parking, air-conditioning and fire prevention facilities

119

Total

647

SUBSEQUENT EVENTSEvents and other notable items occurring subsequent toDecember 31, 2003 (the end of the period under review),
included the issuance of unsecured corporate bonds and theacquisition of three properties. Payment for the issuance of
unsecured corporate bonds was completed on February 12,
2004. Funds raised from the issuance of unsecured corporate
bonds are allocated mainly for the repayment of short-termand long-term debt.
JPR also acquired three properties after December 31,
2003. The Doujima F Building in Osaka was acquired on
January 23, 2004, the Kawaguchi Center Building in Saitama
was acquired on February 13, 2004, and the SEF Building inTokyo was acquired on March 1, 2004.

27

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 28

F I N A N C I A L S TAT E M E N T S

BALANCE SHEETS(As of December 31, 2003 and June 30, 2003)
thousands of yen

U.S. dollars (Note 2)

End of 4th Period(as of Dec. 31, 2003)

End of 3rd Period(as of Jun. 30, 2003)

End of 4th Period(as of Dec. 31, 2003)¥ 17,111,017¥ 19,103,828$ 159,721,992

105,570

63,774985,442—

127,735—ASSETS
CURRENT ASSETS:
Cash and bank deposits
Rental receivables
Consumption tax refundable
Other current assets

118,038

160,065

1,101,817

17,334,625

19,455,402

161,809,251

Land

83,695,367

73,603,296

781,250,508

Buildings and structures

57,990,142

53,389,709

541,306,278

Machinery and equipment

1,066,039

1,015,212

9,950,893

Tools, furniture and fixtures

9,071

8,584

84,670Total current assets
PROPERTY AND EQUIPMENT AT COST:

Construction in progress
Less accumulated depreciation

2,444

16,882

22,818142,763,063

128,033,683

1,332,615,167(3,538,924)(2,518,883)(33,033,918)

139,224,139

125,514,800

1,299,581,249

Deposits

10,10010,10094,278Long-term prepaid expenses

7,322

9,177

68,342¥156,576,186¥144,989,479$1,461,553,120

Net property and equipment
INVESTMENTS AND OTHER ASSETS:TOTAL ASSETS
The accompanying notes form an integral part of these financial statements.

28

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 29

End of 4th Period(as of Dec. 31, 2003)

thousands of yen

U.S. dollars (Note 2)

End of 3rd Period(as of Jun. 30, 2003)

End of 4th Period(as of Dec. 31, 2003)

LIABILITIESCURRENT LIABILITIES:
Trade accounts payable¥

979,067¥

772,249$

9,139,055

Accounts payable

350,816

330,772

3,274,674

Short-term debt

12,900,000

29,500,000

120,414,450

Accrued expenses

10,93432,363102,064

Accrued income taxes

1,027

948

9,587

Accrued consumption taxes

56,860—530,753

Rent received in advance555,270

531,244

5,183,146

14,853,974

31,167,576

138,653,729

39,566,000

40,000,000

369,326,986

Total current liabilities
LONG-TERM LIABILITIES:Long-term debt

10,574,972

14,849,404

98,711,585

Total long-term liabilities

Deposits received from tenants

50,140,972

54,849,404

468,038,571

TOTAL LIABILITIES

64,994,946

86,016,980

606,692,300

89,113,804

56,982,000

831,828,653

UNITHOLDERS’ EQUITY
Unitholders’ capital
Retained earnings
TOTAL UNITHOLDERS’ EQUITYTOTAL LIABILITIES AND UNITHOLDERS’ EQUITY

2,467,436

1,990,499

23,032,167

91,581,240

58,972,499

854,860,820¥156,576,186¥144,989,479$1,461,553,120

29

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 30

STATEMENTS OF INCOME AND RETAINED EARNINGS(For the six-month periods ended December 31, 2003 and June 30, 2003)

OPERATING REVENUES:
Real estate rental revenues
Rental revenues
Non-rental revenues

thousands of yen

U.S. dollars (Note 2)

4th Period(Jul. 1, 2003–
Dec. 31, 2003)

3rd Period(Jan. 1, 2003–
Jun. 30, 2003)

4th Period(Jul. 1, 2003–
Dec. 31, 2003)¥6,421,099¥5,264,525$59,937,448

6,250,395—

58,344,024—

4,898,820——

365,705—

170,704—

1,593,424

3,487,138

3,018,056

32,550,527

2,996,386—

27,969,621—

2,553,300—

Asset management fees

276,344

243,468

2,579,525

Administrative service fees

75,60751,077705,749

Gain on sale of real estate
OPERATING EXPENSES:
Real estate rental expenses
Rental expenses

Other operating expenses
OPERATING PROFITSNON-OPERATING REVENUES:Interest income
Other non-operating revenues

138,801

170,211

1,295,632

2,933,961

2,246,469

27,386,921

1,329

80,71912,412

103

91

965

1,226

80,628

11,447466,923

335,842

4,358,478

Interest expense

350,649

320,685

3,273,122

Loan arrangement fees

30,704

15,147

286,611

NON-OPERATING EXPENSES:

Other non-operating expenses

85,57010

798,745

INCOME BEFORE INCOME TAXES

2,468,367

1,991,346

23,040,855

Current

1,047

965

9,779

Deferred

(38)

4

(360)

NET INCOME¥2,467,358¥1,990,377$23,031,436

78

122

731

¥2,467,436¥1,990,499$23,032,167

INCOME TAXES:RETAINED EARNINGS BROUGHT FORWARD
RETAINED EARNINGS AT END OF PERIOD
The accompanying notes form an integral part of these financial statements.

30

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 31

STATEMENTS OF CASH FLOWS (Unaudited)(For the six-month periods ended December 31, 2003 and June 30, 2003)
thousands of yen

U.S. dollars (Note 2)

4th Period(Jul. 1, 2003–
Dec. 31, 2003)

3rd Period(Jan. 1, 2003–
Jun. 30, 2003)

4th Period(Jul. 1, 2003–
Dec. 31, 2003)¥ 2,468,367¥ 1,991,346$ 23,040,855

1,044,355

894,606

9,748,486

CASH FLOWS FROM OPERATING ACTIVITIES:
Income before income taxes
Depreciation
Interest income

(103)

(91)

(964)

Interest expense

350,649

320,685

3,273,122

Increase in rental receivables(41,796)(3,681)(390,143)

Decrease (increase) in consumption tax refundable

127,735(127,735)

1,192,337

Increase in prepaid expenses(11,708)(6,788)(109,284)

Increase in trade accounts payable

206,818

338,243

1,930,532

Increase in accounts payable

18,56386,155173,276

Increase (decrease) in accrued consumption taxes

56,860(41,770)

530,753

Increase in rent received in advance

24,026

192,008

224,274—(38,189)—

Decrease in deposits received from tenants
Decrease in entrusted fixed properties

418,920—

3,910,385

Change in other current assets/liabilities

59,176(46,198)552,372

4,721,862

3,558,591

44,076,001

103

91

964

(372,079)(295,619)(3,473,150)

(968)

(840)

(9,037)

4,348,918

3,262,223

40,594,778

Purchases of property and equipment(4,721,223)(35,874)(44,070,039)

Purchases of entrusted property and equipment(10,454,938)(32,139,384)(97,591,132)(11,629)(21,338)(108,553)

SubtotalInterest received
Interest paid
Income taxes paid
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:Payment of leasehold and security deposits received
Proceeds from leasehold and security deposits received
Payment of entrusted leasehold and security deposits received
Proceeds from entrusted leasehold and security deposits received

373,594

15,256

3,487,297(5,997,449)(369,597)(55,982,905)

1,361,052

7,686,629

12,704,678(19,450,593)(24,864,308)(181,560,654)

Proceeds from short-term borrowings

6,130,000

27,570,000

57,220,200

Repayment of short-term borrowings(22,730,000)(2,000,000)(212,172,127)

Proceeds from long-term borrowings—

5,000,000—

Repayment of long-term borrowings(434,000)—(4,051,153)

Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from issuance of units

32,131,804—

299,932,825

Distributions to unitholders(1,988,940)(2,021,948)(18,565,673)

Net cash provided by financing activities

13,108,864

28,548,052

122,364,072

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(1,992,811)

6,945,967(18,601,804)

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

19,103,828

12,157,861

178,323,796

CASH AND CASH EQUIVALENTS AT END OF PERIOD¥17,111,017¥19,103,828$159,721,992

The accompanying notes form an integral part of these financial statements.

31JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 32

STATEMENTS OF CHANGES IN UNITHOLDERS’ EQUITY(For the six-month periods ended December 31, 2003 and June 30, 2003)
unitholders’ equity
sharesthousands of yen

289,600¥58,983,838

Cash distributions paid—

(2,001,716)

Net income—

1,990,377

289,600

58,972,499$550,476,049(1,990,421)(18,579,490)

32,131,804

299,932,825

2,467,358

23,031,436¥91,581,240$854,860,820

BALANCE AS OF DECEMBER 31, 2002

BALANCE AS OF JUNE 30, 2003
Cash distributions paid
Public offering

140,400

Net income
BALANCE AS OF DECEMBER 31, 2003

430,000

U.S. dollars (Note 2)

The accompanying notes form an integral part of these financial statements.

NOTES TO FINANCIAL STATEMENTS(December 31, 2003 and June 30, 2003)

1. ORGANIZATION
Japan Prime Realty Investment Corporation (the “Company”),
an externally managed real estate investment corporation,
was incorporated on September 14, 2001 under the Law
Concerning Investment Trusts and Investment Corporationsof Japan, or the Investment Trust Law. The Company wasformed to invest primarily in real estate in Japan.
The Company was originally formed by Tokyo Tatemono
Co., Ltd., Taisei Corporation, and Tokyo Realty Investment
Management, Inc. (“TRIM”), and commenced its operation on
November 16, 2001 by acquiring 13 properties. TRIM, alicensed asset management company, provides professional
asset management services of office and retail properties to
the Company. TRIM is currently owned 26% by Tokyo
Tatemono Co., Ltd., 24% by Meiji Yasuda Life Insurance

Company, 20% by Yasuda Real Estate Co., Ltd., 20% by Taisei
Corporation, and 10% by Sompo Japan Insurance Inc.
On June 14, 2002, the Company raised ¥25,862 million
through an initial public offering and was listed on the Tokyo
Stock Exchange (Securities code: 8955).
On July 14, and August 9, 2003, the Company raised¥32,132 million ($299,933 thousand) through a second offering (unitholders’ capital as of December 31, 2003: ¥89,114
million ($831,829 thousand)).
As of December 31, 2003, the Company owned a portfolioof 32 properties containing an aggregate of approximately
218,734.67 square meters of leasable area, and leased its
office space to 357 tenants. The occupancy rate is 92.7%.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBASIS OF PRESENTING FINANCIAL STATEMENTS
The Company maintains its accounting records and preparesits financial statements in accordance with accounting principles and practices generally accepted and applied in Japan(“Japanese GAAP”), including provisions set forth in theInvestment Trust Law, the Japanese Commercial Code, theSecurities and Exchange Law of Japan and the related regulations, which may differ in some material respects fromaccounting principles and practices generally accepted incountries and jurisdictions other than Japan.
The accompanying financial statements are a translationof the financial statements of the Company, which were prepared in accordance with Japanese GAAP and were pre-32

sented in the Securities Report of the Company filed with the
Kanto Local Finance Bureau. In preparing the accompanying
financial statements, certain reclassifications have been
made to the financial statements issued domestically in orderto present them in a format which is more familiar to readers
outside Japan. In addition, the notes to financial statements
include information which might not be required underJapanese GAAP but is presented herein as additional
information.
The Company’s accounting period ends at the end of Juneand December. The Company’s fourth accounting periodbegan on July 1, 2003 and ended on December 31, 2003.
Amounts in U.S. dollars are included solely for theJPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 33

erally charged to expenses during the period. The sellers of
the properties were liable for property taxes for the calendar
year including the period from the date of purchase by theCompany through the end of the year since the taxes are
imposed on the registered owner as of January 1, based on
the assessment made by the local government. The Company
paid the amount equivalent to the property taxes to the sellers
applicable to the period since acquisition and included theamount equivalent to the taxes in the purchase price of each
property and capitalized as cost of the property.

convenience of readers outside Japan. The rate of¥107.13=US$1.00, the foreign exchange rate on December 30,
2003, has been used for translation. The inclusion of suchamounts is not intended to imply that Japanese yen has beenor could be readily converted, realized or settled into U.S.
dollars at that rate or any other rate.
PROPERTY AND EQUIPMENT
Property and equipment is stated at cost, less accumulated
depreciation. The costs of land, buildings and building
improvements include the purchase price of property, legal
fees and acquisition costs. Depreciation of property andequipment is calculated on a straight-line basis over the estimated useful lives of the assets ranging as follows:

CONSUMPTION TAXES
Consumption taxes withheld and consumption taxes paid are
not included in the statements of income. The consumption
taxes paid are generally offset against the balance of consumption taxes withheld. As such, the excess of payments
over amounts withheld is included in the current assets andthe excess of amounts withheld over payments is included in
the current liabilities.

Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3–64 years
Structures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10–20 years
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . 3–15 years
Tools, furniture and fixtures . . . . . . . . . . . . . . . . . . . . . . . 5–15 years

CASH AND CASH EQUIVALENTS
The statements of cash flows are provided for information
purposes only since they are not required to be prepared by
the Investment Trust Law, the Japanese Commercial Code,the Securities and Exchange Law of Japan and the related
regulations. Cash and cash equivalents consist of cash on
hand, deposits placed with bank and short-term investments
which are highly liquid, readily convertible to cash and withinsignificant risk of price fluctuation, with original maturitiesof three months or less.

Expenditures for repairs and maintenance are charged tooperations as incurred. Significant renewals and betterments
are capitalized.
REVENUE RECOGNITION
Revenues from leasing of office space are recognized as rent
accrued over the lease period.
TAXES ON PROPERTY AND EQUIPMENT
Property and equipment is subject to property taxes and city
planning taxes on a calendar year basis. These taxes are gen-

3. REAL ESTATE
Real estate at December 31, 2003 and June 30, 2003 consisted of the following:
thousands of yen

U.S. dollars

As of June30, 2003

As of December
31, 2003

As of December
31, 2003

Land
Buildings

Acquisition Costs

Book Value¥ 3,171,216¥ 3,171,216

2,540,669

Accumulated depreciation

48,126

Machinery and equipment

11,227

Accumulated depreciation

2,237

Tools, furniture and fixtures

290

Accumulated depreciation

Acquisition Costs¥

331,677¥

Book Value

Acquisition Costs

331,677$ 29,601,572

658,986
2,492,543

18,912
1,398

29,601,572

23,715,756
640,074

11,227
8,990Book Value$

449,233

23,266,523

104,795
9,829

289

20,87583,920

2,702

44

246

17

272

405

2,297

Entrusted land

80,524,151

80,524,151

73,271,619

73,271,619

751,648,936

751,648,936

Entrusted buildings and structures

55,449,473

Accumulated depreciation

3,292,514

Entrusted machinery and equipment

1,054,812

Accumulated depreciation
Entrusted tools, furniture and fixtures
Accumulated depreciation
Entrusted construction in progress
Total

195,453

52,730,723
52,156,959

2,356,525

517,590,522
50,374,198

1,003,985
859,359

8,781

141,823

30,733,821

486,856,701

9,846,098
862,162

8,295

1,824,448

8,021,650

81,968

550

8,231

208

8,087

5,136

76,832

2,444

2,444

16,882

16,882

22,81822,818¥139,224,139¥125,514,800$1,299,581,249

33

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 34

4. SHORT-TERM DEBT
Short-term debt at December 31, 2003 and June 30, 2003 consisted of the following:
As of December
31, 2003

Secured loans from a bank due on September 25, 2003

As of December
31, 2003
Amount(U.S. dollars)

Amount(thousandsof yen)Weightedaverageinterest rate

Amount(thousandsof yen)Weightedaverageinterest rate—

0.579%¥ 1,930,000

0.584%

Secured loans from banks due on March 27, 2004

6,770,000

0.935%

6,770,000

0.939%

63,194,250

Secured loans from a bank due on May 14, 2004—

0.929%

8,000,000

0.929%—

Secured loans from a bank due on July 31, 2003—

0.810%

12,800,000

0.810%—

Secured loans from a bank due on February 27, 2004

2,400,000

0.829%——

22,402,689

Secured loans from a bank due on March 27, 2004

1,800,000

0.838%——

16,802,016

Secured loans from a bank due on March 27, 2004

1,930,000

0.849%

—

—

Total

¥

As of June30, 2003¥12,900,000¥29,500,000$—

18,015,495$120,414,450

5. LONG-TERM DEBT
Long-term debt at December 31, 2003 and June 30, 2003 consisted of the following:
As of December
31, 2003

Secured loans from a trust bank and an insurance company
due on December 27, 2006

As of June30, 2003

As of December
31, 2003

Amount(thousandsof yen)Weightedaverageinterest rate

Amount(thousandsof yen)Weightedaverageinterest rate

Amount(U.S. dollars)¥20,000,000

1.234%¥20,000,000

1.234%$186,689,070

Secured loans from banks due on December 27, 2006

5,000,000

1.295%

5,000,000

1.295%

46,672,267

Secured loans from an insurance company due on December 26, 2008

4,783,000

1.700%

5,000,000

1.700%

44,646,691

Secured loans from an insurance company due on June 21, 2011

4,783,000

2.050%

5,000,000

2.050%

44,646,691

5,000,000

1.750%

5,000,000

1.750%

Secured loans from an insurance company due on March 28, 2013
Total

¥39,566,000¥40,000,000

46,672,267$369,326,986

6. SECURED ASSETSAt December 31, 2003 and June 30, 2003, the following assets were pledged as collateral for the following debt:
Pledged assets:

Cash and bank deposits

thousands of yen

U.S. dollars

As of December
31, 2003

As of June30, 2003

As of December
31, 2003¥ 9,604,410¥ 17,614,344$ 89,651,916

Land

54,633,535

73,157,065

509,974,191

Buildings and structures

41,624,667

50,892,478

388,543,519

Machinery and equipment

785,308

871,991

7,330,416

Tools, furniture and fixtures

7,995

8,359

74,632

Construction in progress

1,625

16,882

15,173¥106,657,540¥142,561,119$995,589,847

Total

Debt secured by the pledged assets:

34

thousands of yen

U.S. dollars

As of December
31, 2003

As of June30, 2003

As of December
31, 2003

Short-term debt

¥12,900,000¥29,500,000$120,414,450

Medium- and long-term debt

39,566,000

40,000,000

369,326,986

Total¥52,466,000¥69,500,000$489,741,436

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 35

7. UNITHOLDERS’ EQUITY
Under the Investment Trust Law and the related regulations,the appropriations of retained earnings and the declaration ofa cash distribution for the current accounting period aremade by the resolution of the Board of Directors at a meeting

held subsequent to the close of the accounting period. As
such, the retained earnings of unitholders’ equity at
December 31, 2003 included cash distribution of ¥2,467,340
thousand ($23,031,270) subsequently made.

8. INCOME TAXESAt December 31, 2003, the Company’s deferred tax assets
consisted mainly of the accrued enterprise tax, which is notdeductible until paid for tax purposes. The reconciliation oftax rate difference between the adjusted statutory tax rates
and the effective tax rates for the six-month periods ended
December 31, 2003 and June 30, 2003 were as follows:
For the period
from July 1, 2003
to December 31, 2003

For the period
from January 1, 2003
to June 30, 2003

Statutory tax rate

39.39%

39.39%

Deductible dividends distribution(39.37%)(39.37%)

Others

0.02%

0.03%

Effective tax rate

0.04%

0.05%

The Company is subject to Japanese corporate income taxes
on all of its taxable income. However, under the Special
Taxation Measures Law of Japan, or the STML, an investment
corporation is allowed to deduct dividends of accounting
profits, or dividend distributions, paid to investors from its
taxable income if certain tax requirements are satisfied. Suchtax requirements include dividend distributions in excess of
90% of its taxable income for the accounting period as
stipulated by Article 67-15 of the STML. Based on the distribution policy provided by the Articles of Incorporation, theCompany made a dividend distribution of approximately 100%of retained earnings in the amount of ¥2,467,340 thousand($23,031,270) at December 31, 2003 and treated it as tax
deductible dividend. The Company will not distribute the dividends in excess of accounting profit under the Articles ofIncorporation.

9. PER UNIT INFORMATION
The following table summarizes information about net assets per unit and net income per unit at June 30, 2003 and December
31, 2003, and for the six-month periods then ended:

Net assets at period-end per unit
Net income per unit

In calculating the net assets per unit, the amount of the
net assets included the cash distribution declared in the subsequent period.
Net income per unit is computed by dividing net incomeby the weighted-average number of units outstanding during
each period. The weighted-average number of units used inyen

U.S. dollars

For the period
from July 1, 2003
to December 31, 2003

For the period
from January 1, 2003
to June 30, 2003

For the period
from July 1, 2003
to December 31, 2003

¥212,979¥203,634$1,988

5,895

6,872

55

the calculation was 418,502 units for the six months ended
December 31, 2003 and 289,600 units for the six months
ended June 30, 2003. Diluted net income per unit has notbeen presented since no warrants and convertible bonds
were issued during the period.

35

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 36

10. RELATED PARTY TRANSACTIONSThe Company entered into the following related party transactions:
thousands of yen

U.S. dollars

For the period
from July 1, 2003
to December 31, 2003

For the period
from January 1, 2003
to June 30, 2003

For the period
from July 1, 2003
to December 31, 2003

¥143,777¥118,707$1,342,077—

56,000—

Leasing commissions

27,8954,512

260,388

Outsourced property operation

333,982

262,742

3,117,537

Repairs and maintenance

99,223364,770926,191

Property management fees
Commissions for property acquisitions

11. BREAKDOWN OF OPERATING REVENUES AND EXPENSES
For the six-month periods ended December 31, 2003 and June 30, 2003.
For the period
from July 1, 2003
to December 31, 2003

U.S. dollars

For the period
from January 1, 2003
to June 30, 2003

For the period
from July 1, 2003
to December 31, 2003

Real Estate Rental Revenues¥6,250,395

Property-Related Revenues—

5,264,525—

5,754,165

4,898,820

53,711,995

Rental Revenues
Rental revenues¥—$58,344,024

4,584,941

3,795,176

42,797,919

Common area charges

992,892

929,753

9,268,109

Parking revenues

153,359

149,986

1,431,526

Other rental revenues

22,97323,905

214,441

Non-Rental Revenues

496,230

365,705

4,632,029

Incidental income

462,939

344,583

4,321,287

—

3,905

—

33,29017,217

310,742
27,969,622

Cancellation charges
Other miscellaneous revenues
Real Estate Rental expenses

2,996,386—

Property-Related Expenses—

2,553,300—

Property management fees

128,900

125,1111,203,209

Utilities expenses

513,937

379,307

4,797,319

Property and other taxes

424,885

425,826

3,966,073

Casualty insurance

36,271

34,194

338,570

Repairs and maintenance

188,291

116,158

1,757,591

Depreciation
Other rental expenses
Profits36

thousands of yen

1,044,355

894,606

9,748,487

659,747

578,098

6,158,373

3,254,009

2,711,225

30,374,402

thousands of yen

U.S. dollars

For the period
from July 1, 2003
to December 31, 2003

For the period
from January 1, 2003
to June 30, 2003

For the period
from July 1, 2003
to December 31, 2003

Proceeds from sale of real estate¥609,335¥—$5,687,806

Cost of real estate

418,920—

3,910,384

Other related sales expenses

19,711—

183,997

Gain on sale of real estate

170,704—

1,593,425

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 37

12. LEASESThe Company leases office buildings and earns rental income. As of December 31, 2003 and June 30, 2003, the future lease revenues under the non-cancelable operating leases are as follows:
thousands of yen

U.S. dollars

As of December 31, 2003

As of June 30, 2003

As of December 31, 2003

Due within one year

¥ 3,010,179¥ 2,276,148$ 28,098,379

Due after one year

21,794,572

17,379,292

203,440,413

Total

24,804,751

19,655,440

231,538,792

13. SUBSEQUENT EVENTSISSUANCE OF CORPORATE BONDS
Pursuant to a resolution of the Board of Directors’ meeting held on January 28, 2004, the Company undertook an issue of corporate bonds as follows. The issuance payments were completed on February 12, 2004.
(1) FIRST SERIES OF CORPORATE BONDS
Name of the bondJapan Prime Realty Investment Corporation’s First Series Unsecured Bonds(The Unsecured Bonds rank pari passu at least equally in right of payment with all other unsecured indebtedness. Private
placement with transfer restrictions to qualified institutional investors.)

Total issue amount¥10 billion

Issue price¥100 with a par value of ¥100

Coupon rate

0.84% per annum

Subscription date

January 29, 2004

Payment dateFebruary 12, 2004

Collateral

Unsecured, Unguaranteed

Maturity date and redemption method

Principal will be redeemed in full on February 12, 2008. Bonds may be redeemed at any time from the day immediately
following the payment date.

Use of proceeds

Repayment of existing debt and other(2) SECOND SERIES OF CORPORATE BONDS
Name of the bondJapan Prime Realty Investment Corporation’s Second Series Unsecured Bonds(The Unsecured Bonds rank pari passu at least equally in right of payment with all other unsecured indebtedness. Private
placement with transfer restrictions to qualified institutional investors.)

Total amount¥7 billion

Issue price¥100 with a par value of ¥100

Coupon rate

1.38% per annum

Subscription date

January 29, 2004

Payment dateFebruary 12, 2004

Collateral

Unsecured, Unguaranteed

Maturity date and redemption method

Principal redemption in full on February 12, 2010. Bonds may be redeemed at any time from the day immediately following
the payment date.

Use of proceeds

Repayment of existing debt and other(3) THIRD SERIES OF CORPORATE BONDS
Name of the bondJapan Prime Realty Investment Corporation’s Third Series Unsecured Bonds(The Unsecured Bonds rank pari passu at least equally in right of payment with all other unsecured indebtedness. Private
placement with transfer restrictions to qualified institutional investors.)

Total issue amount¥5 billion

Issue price¥100 with a par value of ¥100

Coupon rate

2.32% per annum

Subscription date

January 29, 2004

Payment dateFebruary 12, 2004

Collateral

Unsecured, Unguaranteed

Maturity date and redemption method

Principal redemption in full on February 12, 2014. Bonds may be redeemed at any time from the day immediately following
the payment date.

Use of proceeds

Repayment of existing debt and other37

JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 38

REPORT OF INDEPENDENT AUDITORS

To the Board of Directors and Unitholders of Japan Prime Realty Investment Corporation

We have audited the accompanying balance sheets of Japan Prime Realty Investment Corporation as ofDecember 31, 2003 and June 30, 2003, the related statements of income and retained earnings, and changes inunitholders’ equity for the six-month periods ended December 31, 2003 and June 30, 2003, all expressed in yen.
These financial statements are the responsibility of the Company’s management. Our responsibility is to independently express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards, procedures and practices generally accepted andapplied in Japan. Those standards, procedures and practices require that we plan and perform the audit to obtainreasonable assurance about whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by management,
as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonablebasis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Japan Prime Realty Investment Corporation at December 31, 2003 and June 30, 2003, and the results of its
operations for the six-month periods ended December 31, 2003 and June 30, 2003 in conformity with accounting
principles and practices generally accepted in Japan.
The U.S. dollar amounts in the accompanying financial statements with respect to the six-month period ended
December 31, 2003 are presented solely for convenience. Our audit also included the translation of yen amounts
into U.S. dollar amounts and, in our opinion, such translation has been made on the basis described in Note 2 tothe financial statements.

Shin Nihon & Co.

Tokyo, Japan
February 16, 2004

See Note 2 to the financial statements, which explains the basis of presentation of the financial statements ofJapan Prime Realty Investment Corporation under Japanese accounting principles and practices.

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U N I T H O L D E R I N F O R M AT I O N

Breakdown of Unitholders (As of December 31, 2003)
By Number of Units Held
Financial institutions

52.3%
Other domestic corporations

20.4%
Foreign investors

10.8%
Individuals and others

Total

100%

16.5%

By Composition
Financial institutions

0.6%
Other domestic corporations

1.6%
Foreign investors

0.2%
Individuals and others

Total

100%

97.6%

Major Unitholders (As of December 31, 2003)
Units

(%)

Tokyo Tatemono Co., Ltd.

39,300

9.1

Japan Trustee Services Bank, Ltd.

37,264

9.1

Meiji Yasuda-Life Insurance Company

34,0007.9

Goldman Sachs International

24,893

5.8

Kawasaki Gakuen

19,700

4.6

The Hiroshima Bank, Ltd.

12,1992.8

The Bank of Ikeda, Ltd.

8,988

2.1

The Daisan Bank, Ltd.

8,722

2.0

The Joyo Bank, Ltd.

8,093

1.9

Aozora Bank, Ltd.

7,574

1.8

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JPR-第四期 財務 4/5 04.4.8 9:52 PM ページ 40

M E M B E R S O F T H E B O A R D (As of December 31, 2003)

Name Title
Biography*Number of Investment Units Held

Japan Prime Realty Investment Corporation

Hirohito Kaneko Executive Officer

Tokyo Realty Investment Management, Inc.
*0

Dec. 19,2001 Executive Officer of Japan Prime Realty Investment

Toshihiro Hagiwara President and CEO*0

Jan. 23,2001 President, Tokyo Realty Investment Management,

Corporation

Inc.

Representative Counsel (currently on service)of Hirohito Kaneko Law Office

Apr. 1,1999

Director and Head of Osaka Branch OfficeJan. 1,1998

Head of Development Business Department of
Kinshicho Project (Tokyo) and led negotiations forcity planning of large-scale development of morethan 28,000m2

Mar. 28,1992

Director of Secretary’s Office and Human Resources

Apr. 20,1989

Planning of redevelopment scheme connecting
Akihabara and Okachimachi (Tokyo) for JR East
Urban Development Corporation (Joint Venture ofJapan Railway East)

Corporation

July 1,1985

Property management and acquisition businesses of
Building Department

Oct. 1,1999

Director and Senior Partner (currently on service),
Tokyo Hokuto & Co., (Tokyo Akasaka Audit Co.
and Hokuto Audit Co. merged)

Apr. 1,1968

Tokyo Tatemono Co., Ltd.

July 2,1993

Senior Partner, Tokyo Akasaka Audit Co.

Takeshi Maki Director and Chief Financial Officer

Feb. 16,1983

Representative of Tokyo Akasaka CPA Joint Office

July 1,2001 Director and Chief Financial Officer, Tokyo Realty

June 27,1980

Sosuke Yasuda Tax Accountant Office(currently on service)

Apr. 1,2000 General Manager of Pension Management

Apr. 1,1979
Apr. 1,1977

Bar admission (Tokyo Bar Association)
Shigeru Yamada Law Office

Sosuke Yasuda Supervising Officer*0

Sept. 14,2001 Supervising Officer, Japan Prime Realty Investment

Dec. 1,1975

Masamitsu Serizawa Accounting Firm

Apr. 1,1968

Main Store, KK Ohgiya*0Investment Management, Inc.
Department
Apr. 1,1991

Manager of International Investment Department incharge of investments in overseas real estate andfinancing activities

Oct. 1,1989

Investment Banking Division of Paine Webber Japan
Inc. in Tokyo, where he was involved with M&A andIPO businesses*0Oct. 23,1983

New York representative office of Yasuda Life

Sept. 14,2001 Supervising Officer, Japan Prime Realty Investment

Apr. 1,1973

Finance Department of The Yasuda Mutual Life
Insurance Company

Shigeru Sugimoto Supervising Officer
Corporation
June 1,2001 Auditor, Morimoto Co., Ltd. (currently on service)
Oct. 2,1999

Representative Director of Tokyo SPC Services(currently on service)

Yukio Furuya Director and Chief Investment Officer

June 24,1998

Senior Partner (currently on service) of Horwath
Sakura & Co. (ex- Sakura Audit Corporation)

Dec. 1,1996

Horwath International

Dec.22,1995

Sakura Audit Corporation

vices

July 1,1988

Representative Director of Sakura & Co.
(currently on service)

Jan. 1,1998

Tenant-leasing team leader

June 1,1993

Took charge of tenant leasing

Realty Investment Management, Inc.
Apr. 1,1999

Group leader of the Sales Planning Group
Structured a system of property management ser-

Nov. 1,1985

Ohta Showa Audit Corporation

Nov. 1,1990

Tokyo Tatemono of America

Apr. 1,1982

Housing and Urban Development Public
Corporation

Apr. 1,1981

Tokyo Tatemono Co., Ltd. Involved in real estate
investment, leasing to tenants and appraisalsof real estate

Shuichi Yoneta Director and Chief Administrative Officer
Jan. 23,2001 Director and Chief Administrative Officer of Tokyo

Realty Investment Management, Inc.

40

*0Jan. 23,2000 Director and Chief Investment Officer of Tokyo

Apr. 1,1998

Manager of Real Estate Planning Group of Real
Estate Department
At the same time, responsible for internal rules,
regulations and legal matters

Apr. 1,1981

The Yasuda Mutual Life Insurance Company*0JPR-第四期 C1-C4 04.4.9 10:14 AM ページ 41 (1,1)

PROFILEC O R P O R AT E D ATA

Established on September 14, 2001, Japan Prime Realty Investment Corporation
is a closed-end, corporate type fund that invests primarily inhigh-quality office buildings and retail properties locatedin Tokyo and other major cities in Japan.

Head Office
9-9 Yaesu 1-Chome, Chuo-ku, Tokyo 103-8285, Japan
Tel: +81-3-3231-1051
Fax: +81-3-3274-7775
Date of Establishment
September 14, 2001
Listing
Tokyo Stock Exchange (Securities Code: 8955)

With its geographically diverse portfolio, JPR’s primary objective is to achievesustainable growth and stable cash distributions to its investors.

Fiscal Period Ends
June 30 and December 31 of each year
General Meeting of Unitholders
More than once every two years
Cash Distribution Payment Eligibility
Unitholders of record as of June 30 and December 31 ofeach year
Transfer Agent
Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo

Location of Records
Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo
Main Branch, Stock Transfer Agency Division
Mailing Address Mizuho Trust & Banking Co., Ltd.
1-17-7 Saga, Koto-ku, Tokyo 135-8722
Stock Transfer Agency Division
Telephone+81-3-5213-5213 (Representative)
AgentsMizuho Trust & Banking Co., Ltd.
(All branches nationwide)
Mizuho Investors Securities Co., Ltd.
(Head Office and all branches nationwide)
Note: On March 12, 2003, Mizuho Trust & Banking Co., Ltd. merged with Mizuho
Asset Trust & Banking Co., Ltd., to establish a new trust and banking entity under
the name of Mizuho Trust & Banking Co., Ltd. As a result, Mizuho Trust & Banking's
main branch changed its address on the same date.

Websitehttp://www.jpr-reit.co.jp/jpr_e/index.html

English page
This Website has been createdspecifically for our English-speaking
readers.

Performance
Trends in occupancy rate byarea and purpose; trends ininvestment conditions.
Updated monthly.

ANNUAL SCHEDULE (PROVISIONAL)
FAQ
DEC.

12 Balance date for the six-month period ended December 31
FEB.

2

Answers to commonly asked
questions by our unitholders
and investors are found here.

Announcement of results for the six-month period ended December 31
MAR.

3

Publication of December Performance Information Report
Payment of cash distributions for the six-month period ended December 31

Balance date for the six-month period ended June 30

6 JUNE

Announcement of results for the six-month period ended June 30

8 AUG.

Publication of June Performance Information Report
Payment of cash distributions for the six-month period ended June 30

9 SEPT.

Note: Performance Information Report is prepared pursuant to the Investment Trust Law of Japan.

CONTENTS: TO OUR INVESTORS 1 FINANCIAL HIGHLIGHTS 3 PORTFOLIO BREAKDOWN 5 ACTIVITY HIGHLIGHTS 7 SUBSEQUENT ACTIVITY HIGHLIGHTS 9
PROPERTY PORTFOLIO OF JPR 10 REIT STRUCTURE AND EXTERNAL SERVICE PROVIDERS 21 MANAGEMENT’S DISCUSSION AND ANALYSIS 24
FINANCIAL STATEMENTS 28 UNITHOLDER INFORMATION 39 MEMBERS OF THE BOARD 40 CORPORATE DATA 41

Investor Relations
News releases are posted here as appropriate, as well as
information useful to unitholders and investors in evaluating
the status of JPR, including financial statements and otherlegally mandated reports.

This document contains a translation of selected information described in the Financial Report (Kessan Tanshin) dated February 17, 2004 prepared under the timely disclosure requirementsof the Tokyo Stock Exchange, as well as the Financial Statements and Performance Information Report prepared pursuant to the Investment Trust Law of Japan, for the period from July 1,
2003 to December 31, 2003 of Japan Prime Realty Investment Corporation (“JPR”).
This English language document was prepared solely for the convenience of and reference by non-Japanese investors and is not intended to constitute a disclosure document. The
Japanese language Financial Report, Financial Statements and Performance Information Report for the aforementioned period should be referred to as the originals of this document.
English translations for legal, accounting, tax and business concepts used herein may not convey precisely identical concepts of the equivalent Japanese terms. The figures presented in
the financial statements may differ from the Company’s Financial Report (Kessan Tanshin) due to rounding. With respect to any and all terms herein, including without limitation, financial
statements, if there exist any discrepancies in the meaning or interpretation thereof between the original Japanese documents and English documents contained herein, the original
Japanese documents will govern the meaning and interpretation. Neither JPR, Tokyo Realty Investment Management, Inc. nor any of their respective directors, officers, employees, partners,
unitholders, agents or affiliates will be responsible or liable for the completeness, appropriateness or accuracy of English translations or the selection of the portion(s) of any document(s)translated into English. No person has been authorized to give any information or make any representations other than as contained in this document in relation to the matters set out in thisdocument, and if given or made, such information or representation must not be relied upon as having been authorized by JPR, Tokyo Realty Investment Management, Inc. or any of theirrespective directors, officers, employees, partners, unitholders, agents or affiliates.
The financial statements of JPR have been prepared in accordance with generally accepted accounting principles in Japan (Japanese GAAP), which may materially differ in certain
respects from generally accepted accounting principles in other jurisdictions.
Many provisions of this document contain information that constitute forward-looking statements. These forward-looking statements are not a guarantee of future performance andinvolve risks and uncertainties, and actual results may differ materially from those in the forward-looking statements as a result of various factors.

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JPR
JAPAN PRIME REALTY INVESTMENT CORPORATION

Fourth Fiscal Period Business Report
July 1, 2003– December 31, 2003

Printed in Japan