Second Fiscal Period Financial Results(ended November 2007)

Basic Principle

The Fund will adhere to the following basic principles in order to execute fund management in accordance withsolid investment policies for investment in residential properties:

Strategy

The Fund will aim to secure stable mid-to-long-term earnings through the strategic selection of investment
properties and expert asset management based on sufficient understanding of “tenancy demands”
reflecting the characteristics of residential rental property investments and trends in residential property
markets.

Acquisition

The Fund will create stable portfolio with consideration to rental levels, investment area, building age andtypes of properties, through continuous acquisition of “PROUD FLAT” from Nomura Real Estate Group and“PRIME URBAN” and “URBAN STAGE” properties from other sources, utilizing our sourcing expertise.

Asset Management

To maximize long-term profitability and asset value of investment properties, the Fund will select the“optimal property management company corresponding to the characteristics of the property,” and at thesame time, implement flexible and organized leasing and renewal strategies corresponding to tenant
turnovers, aging of the portfolio, and expansion of portfolio assets.

Finance

The Fund will establish a strong financial base such as “conservative LTV ratio,” ”appropriate control ofduration and fixed interest rates,” and “diversification of financial institutions,” in order to manage the Fundin a stable manner, with minimum impact from the financial market conditions.

Compliance

The Fund will implement fair and transparent management through prevention of conflict of interests andenforcement of compliance, to maintain our position as a “REIT committed to meeting the trust andexpectations of the investors.”

Contents

Highlights of the Second Fiscal Period (ended Nov. 30, 2007)

 Highlights of the Second Fiscal Period

Fund Management Results of the Second Fiscal Period2

 Results of Investment(1) Acquisition from Nomura Real Estate Development

15 - 17(2) Acquisition from External Providers

18 - 25

Fund Management Summary

 Status of Portfolio

 Investment Strategy

 Results of Asset Management26(1) Investing in Properties Expected to have Stable Demand

4(1) Portfolio Occupancy Rate

27(2) Utilize Diverse Sourcing Routes

5(2) Renovations28

 Results of Financing

29

 Investment Results(1) Results of Acquisition Activities after Listing

6(2) Results of Portfolio Growth7 Policies to Secure Stable Cash Flow

8 Credit Ratings and Additional Issue of Investment Units

9

APPENDIX Portfolio (as of the end of the 2nd Fiscal Period)
 Scheduled Acquisitions after the 2nd Fiscal Period

Overview of the Second Fiscal Period Financial Results

 Interest-bearing Debts (at the end of the 2nd Fiscal Period) Income Statement11 Unitholders (at the end of the 2nd Fiscal Period) Balance Sheet

12 Organization of the Asset Management Company

 3rd and 4th FP Forecast (announced Jan. 21, 2008)13

 Focus on ComplianceHighlights of the Second Fiscal Period

1Highlights of the Second Fiscal Period

Notable Activities
Property Acquisition

Asset Management
 Promote “integrated operational management”
through cooperation with the “optimal property
management company for each property”

 Concluded Agreements:
21 Properties/¥21,366 million⇒ Portfolio including scheduled acquisitions
123 Properties/¥100,281million
 Concluded Acquisitions:
8 Properties/¥8,385 million(includes the 2 scheduled acquisitions from the
1st Fiscal Period)⇒ Portfolio of acquired properties
97 Properties/¥75,420 million

Finance Secured a high level portfolio occupancy rate
exceeding 95% throughout the 2nd Fiscal Period(95.8% at the end of the 2nd Fiscal Period)

 Secured the highest credit ranking among J-REITs in
July 2007 from 3 rating agencies
 Promote diversification of lenders(added 2 new institutions) Promote conservative financial strategies(long-term/fixed-rates ratio, duration, etc.)

 Looking ahead to busy leasing periods and execute
various building renovations

Financial Overview
Second Fiscal Period(ended November 2007)

Comparison with Forecasts(released July 17, 2007)－－¥2,484 million+ ¥81 million+ 3.4 ％

Current Profits¥954 million+ ¥36 million+ 4.0 ％Net Income¥953 million+ ¥36 million+ 4.0 ％

+ ¥542+ 4.0 ％

Number of Business Days

183 days

Operating Revenues

Cash Distribution Per Unit

¥14,005

2

Fund Management Summary

3

Investment Strategy (1) Investing in Properties Expected to have Stable Demand

Establish Targets Directed at“Rental Demand with a Broad Tenant Class”

TargetFocus Tenant Class
Middle class tenants, centering onUpper middle class tenants, such as
students and coporate employees inforeign company employees.
their 20s and 30s.

Priority on certain level of convenience Priority on location, floor plan, andfor commuting and rent.
specifications/equipments.
Features

Annual income (disposable) is stable.
Less likely to be affected by economic
trends.

Significantly affected by seasonal
factors, such as the concentration oftermination and execution of rental
Turn-Overagreements in March, when corporate
emplayees enter/get transferred andstudents enter/ graduate.
(Generally)
Rent
less than ￥100,000/month

Other Tenant Classes
Upper class tenants, such ascompanies with rent
subsidization systems,
business owners, managementclass emplayees of foreign
Priority on prime metropolitan
location, property grade andvalue-added services.

Annual income (disposable) is relatively
Annual income (disposable) is
stable. Relatively less likely to be
likely to be affected byaffected by economic trends.
economic trends.
Effect of seasonal factors is relatively
small compared to the middle class.

Demand is limited, andvacancy tends to be longer.

Core Elements for Property Selection■ Broad tenant demand

Rent Level

×
Access×(Generally)￥100,000-￥150,000/month(Generally)
over ￥150,000/month

Appropriate rent level for target tenantsCommuting Time

Railway lines that are well-known,
railway lines with direct connections
to large-scale transfer stations

Target tenant’s travel time to theirplace of work/school■ Key points for early lease-up(acquisition of newly developed properties)
Property Size

Number of units that allow a lease-up
within a short time-frame(Up to approximately 100 units*)* Excluding sub-lease properties, etc.

(Note) The section circled in the graph above indicates the Fund’s main target tenant class. The Fund
will consider investment in properties targeting other tenant classes, if it is deemed to have stabledemands from the market characteristics and location viewpoints.

4

Investment Strategy (2) Utilize Diverse Sourcing Routes

Diverse Sourcing Routes for Each Brand

PROUD FLATPRIME URBAN

URBAN STAGE

Properties planned/developed by
Nomura Real Estate Development

Properties planned/developed bycompanies other than
Nomura Real Estate Development

Properties planned/developed bycompanies other than
Nomura Real Estate Development<Age of Building: Approx. 1 year or less><Age of Building: Approx. 1 year or more>

Brand<Age of Building: Approx. 1 year or less>

Strategic Cooperation with Nomura
Real Estate Development

Acquisition
Strategy

The strategic cooperation with Nomura Real
Estate Development and undertaking thedevelopment and acquisition of PROUDFLAT condominiums making full use of its
housing related know-how, such as landacquisition, product planning, management,
etc., plays a pivotal role in the Fund’s growthstrategy and will be utilizing the expansive
brokerage network held by Nomura Real
Estate Group.

Utilization of Networks with Providers
Utilization of Nomura Real Estate Group Information Networks
Proactively utilizing the network with providers built through the management of a private
fund spanning more than 5 years and the Fund’s management extending over 1 year.
Additionally, seek to collect timely information on properties for sale by utilizing the
expansive brokerage network held by Nomura Real Estate Group.

Utilize “diverse sourcing routes” to its full extent, in order seek stable acquisition of prime assets

5Investment Performance (1) Results of Acquisition Activities after Listing

Stable Acquisition Performance in All Brands(millions of yen)

PROUD FLAT
Property NamePROUD FLAT Yokohama *PRIME URBAN
Price
2,340

1st Fiscal Period(After listing)
13 Properties
9,334 million

1 Property
PROUD FLAT Shibuya Sakuragaoka *PROUD FLAT Shinjuku Kawadacho *PROUD FLAT Shinotsuka
PROUD FLAT Monzen Nakacho II *2nd Fiscal Period
PROUD FLAT Shirogane Takanawa *PROUD FLAT Monzen Nakacho I *21 Properties
21,366 million

2,340
800
1,010
695
650
3,510
1,130

6 Properties
PROUD FLAT Kamioooka *Property Name
PRIME URBAN Miyanosawa
PRIME URBAN Maruyama
PRIME URBAN Kanayama *PRIME URBAN Senzoku
PRIME URBAN Kita Jyuichi Jo
PRIME URBAN Odori Higashi
PRIME URBAN Chiji Kokan
PRIME URBAN Kita Nijuyo Jo *PRIME URBAN Sapporo Idaimae
PRIME URBAN Tsurumai*
10 Properties
PRIME URBAN Denenchofu Minami *PRIME URBAN Meguro Ohashi Hills *PRIME URBAN Meguro Riverside
PRIME URBAN Nishi Waseda
PRIME URBAN Nakano Kamitakada *PRIME URBAN Minami Karasuyama
PRIME URBAN Karasuyama Galleria
PRIME URBAN Karasuyama Court

7,795
8 Properties
2,770 PRIME URBAN Nagamachi Icchome

PRIME URBAN Yaotome Chuo

URBAN STAGE
Price
576
283
632
536
600
424
337
503
731
1,189
5,813
900
3,580
464
503
640
840
645
413

Property NameーURBAN STAGE Musashi Kosugi comodo
URBAN STAGE Gyotoku Ekimae
URBAN STAGE Minami Gyotoku V
URBAN STAGE Gyotoku

7,985
4 Properties
1,110 URBAN STAGE Hongo Ikizaka
428 URBAN STAGE Shinjuku Ochiai

URBAN STAGE Kamikitazawa
URBAN STAGE Shinkawa
URBAN STAGE Kawasaki

3rd Fiscal Period(As of Feb. 28)

Other
Price

Property Name
Benefis Hakata Grand Sweet
Benefis Yakuin Minami

Price

ー
2 Properties
2,150 Benefis Kashii Verbena
561 Benefis Hakata Higashi Grand Sweet
293 Benefis Chihaya Grand Sweet
948

1,181
396
693
545

3,952
3 Properties
647 Koganei Habitation
635 Musashino Green Hills
738
2,250
115

1,634
2,390
1,590

830
351

10 Properties
12,673 million

1 Property

2,770

2 Properties

1,538

5 Properties

4,385

2 Properties

3,980

8 Properties

12,90520 Properties

15,336

9 Properties

8,337

7 Properties

6,795

Total
44 Properties
43,373 million(Note) The properties mentioned above is the Fund's portfolio from the day of listing to February 28, 2008. The price refers to the acquisition price, all of which are rounded down to the nearest million.
(Note) The building names with a (*) mark are tentative names.

Through the “utilization of diverse sourcing routes” achieved stable acquisition performance for all brands

6

Investment Performance (2) Growth of Asset Size

The Growth of Portfolio through Acquisition of Prime Properties■

Illustration of Expansion of Asset Size■(billions of yen)
Scheduled Acquisitions

Aquired Properties

300.0
250.0

Stable Acquisition of Prime Properties

Total Assets
300 billion

Growth of
44 Properties/¥43.3 billion

200.0
150.0
100.0

89 Properties
69.5 billion

102 Properties
78.9 billion

123 Properties
100.2 billion

133 Properties
113.9 billion

50.0Time of Listing End of 1st FP End of 2nd FP
NovemberFebruary
May
2007
2007
2007

Present
February
2008

Aiming for “steady portfolio growth” through stable acquisition of prime properties

7

Policies to Secure Stable Cash Flow (Guaranteed rents, etc. in new properties)“Stable Earnings until Increase in Occupancy Rate” + “Pursue the Upside Following Lease-up”
Changes in rental income of newly developed properties (image chart)High Occupancy Rate
Properties that haveguaranteed rental fees, etc.

Secure stable cash flow even at thestart of the initial operation

Regular properties

Increase cash flow in accordance withthe progress of lease-up
Low Occupancy Rate
Commence Leasing(Time of Completion)

Lease-up Period(After Completion)

Period of Stable
Occupancy Rate

Properties which use the method of guaranteed fees, etc.
Location

Leasable Units(Scheduled)Completion Date

(Scheduled)
Acquisition Date

PRIME URBAN Sapporo Idaimae

Sapporo-shi, Hokkaido

58 units

March 2008

March 26, 2008

PRIME URBAN Nagamachi Icchome

Sendai-shi, Miyagi

60 units

January 2008

February 1, 2008

PRIME URBAN Yaotome Chuo

Sendai-shi, Miyagi

43 units

January 2008

February 1, 2008

PRIME URBAN Tsurumai (tentative name)

Nagoya-shi, Aichi

104 units

July 2008

March 5, 2009

Benefis Kashii Verbena

Fukuoka-shi, Fukuoka

39 units

February 2008

March 5, 2008

Benefis Hakata Higashi Grand Sweet

Fukuoka-shi, Fukuoka

65 units

March 2008

March 19, 2008

Benefis Chihaya Grand Sweet

Fukuoka-shi, Fukuoka

48 units

March 2008

March 28, 2008

Property Name

Use the most appropriate methods for early revenues by regarding time of completion, market scale, etc.

8Credit Ratings and Additional Issue of Investment Units

Credit Ratings
Rating Agency

RatingOutlookJapan Credit Rating Agency, Ltd.

Long-term Senior Debt Rating: AA

StableMoody’s Investors Service

Issuer Rating: A1

StableLong-term Corporate Credit Rating: A+

Standard & Poor’s

Short-term Corporate Credit Rating: A-1

StableSelecting the most appropriate procurement methods from “Diverse funding procurement methods,”
which include the issuance of investment corporation bonds

Additional Issue of Investment Units
 Issuance resolution date: Number of units issued: Offer price Proceeds
 Payment date: Number of units after new issue:

January 21, 2008
27,300 units (Public Offering), 1,365 units (Third-party Allotment)¥451,780 per unit (2% discounted from the closing price on Feb. 5, 2008)¥11,918 million (Public Offering)
February 13, 2008 (Public Offering)
95,400 units (After Public Offering)

Aim at a balanced growth in all aspects of “Property acquisition,” “Asset management,” and “Financial Strategies”

9Overview of the Financial Results

10Income Statement

Classification

First Fiscal Period

Second Fiscal Period

From August 3, 2006
To May 31, 2007

From June1, 2007
To November 30, 2007

Amount (￥000) Ratio (%) Amount (￥000) Ratio (%)
Real Estate Rental Business Revenues

2,304,704

100.0

2,484,628

100.0 *1

*1 [Real Estate Rental Business Revenues]

Rental Business Revenues

2,101,518

91.2

2,372,329

95.5

Other Rental Business Revenues

203,1858.8

112,298

4.5

As of the end of the 2nd Fiscal Period, the portfolio consists of 97
properties/¥75.4 billion (total acquisition price). The occupancy rate for the
portfolio at the end of the 2nd Fiscal Period is 95.8%.

Real Estate Rental Business Expenses

963,34241.8

896,96436.1

559,99324.3

446,059

18.0 *2*2 [Repair Expenses]

5,176

0.2

53,2992.1 *3398,17317.3

397,604

16.0

Repair expenses reported as expenses in the 2nd Fiscal Period is¥85,269,000. In combination with ¥31,586,000 in capital expenditures, a
total of ¥116,856,000 in construction was carried out.

Real Estate Rental Business Profits and Losses

1,341,361

58.2

1,587,663

63.9

Asset Management Fees

141,0316.1

182,851

7.4

Other Operating Expenses

122,100

5.3

140,999

5.7

1,078,229

46.8

1,263,812

50.9

Non-Operating Revenues

1,003

0.0

6,265

0.3

Non-Operating Expenses

525,94222.8

315,335

12.7

Current Profits

553,29124.0

954,743

38.4

Net Income before Tax553,29124.0

954,743

38.4

1,515

0.1

999

0.0

551,775

23.9

953,743

38.4

－

0.0

29

0.0

551,775

23.9

953,773

38.4

Real Estate Rental Business Expenses
Tax and Public Dues
Depreciation and Amortization

Operating Income

Corporate Income Tax, etc.
Net Income before Tax
Retained Earnings Brought Forw ard
Retained Earnings at the end of the Fiscal Period*3 [Tax and Public Dues]
During the 2nd Fiscal Period, of the 97 properties in the portfolio, 57
properties have reported fixed asset taxes and urban planning taxes in theyear 2007 as expenses. Fixed asset taxes and urban planning taxes
adjusted with the seller at the time of acquisition (¥45,841,000) have been
included in the acquisition price.

11Balance Sheet
AssetsLiabilities and Net Assets

Items

Fist Fiscal Period

Second Fiscal Period

as of May 31, 2007

as of Nov. 30, 2007

Items

Amount (￥000) Ratio (%) Amount (￥000) Ratio (%)
Current Assets

6,941,125

9.2

3,974,905

4.9

Cash and cash equivalents

5,064,215

6.7

2,062,189

2.5

Cash and cash equivalent in trust

1,788,634

2.4

1,820,953

2.3

Other current assets
Fixed Assets
Tangible fixed assets

88,2740.1

91,7620.1

68,372,764

90.8

76,915,836

95.1

68,359,040

90.8

76,902,158

Current Liabilities

1.7

5,098,162

6.3

186,1310.2

109,759

0.1

Short-term loans

440,000

0.6

4,360,000

5.4 *2Other accounts payable

235,0480.3

157,649

0.2

1,346

0.0

653

0.0

95.1 *1

Taxes payable

22.8

Accrued expenses

101,795

0.1

153,568

0.2

278,0470.4

314,883

0.4

3,473

0.0

1,647

0.0

32,260,599

42.8

33,583,135

41.5

Long-term loans

31,500,000

41.8

32,740,000

40.5 *2

Security deposits

63,971

0.1

153,032

0.2

Securitiy deposits in trust

696,6280.9

690,102

0.9

Total Liabilities

33,506,442

44.5

38,681,297

47.8

41,807,447

55.5

42,209,444

52.2

41,255,671

54.8

41,255,671

51.0

Building

3,871,120

5.1

7,332,739

9.1

Rent received in advanceLand5,805,777

7.7

11,102,920

13.7

Deposits payable

Real estate in trust

58,651,995

77.9

58,401,685

72.2

Building in trust

20,642,397

27.4

20,384,968

25.2

Land in trust

38,009,597

50.5

38,016,717

47.0

30,1470.0

64,812

0.1

1,774

0.0

1,635

0.0

1,774

0.0

1,635

0.0

Investment and other assets
Deposits received

11,94910,298Long-term repaid expenses
Total Assets

Building
Land
Building in trust
Land in trust

12,0430.0

0.0

10,421

0.0

1,651

0.0

1,622

0.0

75,313,889

100.0

80,890,742

100.0*1 Tangible fixed assets

Real Estate

0.0(unit: millions of yen)

AcquisitionPrice

Accumulated
depreciation(Depreciation
for current FP)

Book value
at end of FP

77,633
7,428
11,102
21,08538,016

795
95

(397)
(80)

－
700

－
(317)

－

－

76,837
7,332
11,102
20,38438,016as of Nov. 30, 2007

1,245,843

12.8

Other intangible fixed assets

as of May 31, 2007

Trade accounts payable

9,676,898

Intangible fixed assets

Second Fiscal Period

Amount (￥000) Ratio (%) Amount (￥000) Ratio (%)

Real estate

Construction in progress

18,435,659

First Fiscal Period

Fixed Liabilities

Unitholders Equity
Unitholders capital
Retained earnings

551,775

0.7

953,773

1.2

Total New Assets

41,807,447

55.5

42,209,444

52.2

Total Liabilities and Net Assets

75,313,889

100.0

80,890,742

100.0*2 Loans
37,100

Balance of interest-bearing debts (millions of yen)short-term + long-term loans
Total asset interest-bearing debt ratio

total assets

Long-term interest-bearing debt ratio

long-term + short-term loans

45.9%

long-term loans

88.2%

12

Forecasts for 3rd and 4th Fiscal Period (announced Jan. 21, 2008)
3rd Fiscal Period Forecasts

4th Fiscal Period Forecasts(December 1, 2007-May 31, 2008)(June 1, 2008-November 30, 2008)

Rental Business Revenues

3,226 million yen

Rental Business Revenues

3,693 million yen

Rental Business Expenses

1,299 million yen

Rental Business Expenses

1,395 million yen

Asset Management Fees

215 million yen

Asset Management Fees

368 million yen

Other Operating Expenses

160 million yen

Other Operating Expenses

180 million yen

Operating Income

1,550 million yen

Operating Income

1,748 million yen

Non-Operating Profit/Loss

480 million yen

Non-Operating Profit/Loss

471 million yen

Current Profits

1,069 million yen

Current Profits

1,276 million yen

Net Income

1,068 million yen

Net Income

1,275 million yen

Cash Distribution per Unit

11,043 yen

Cash Distribution per Unit

13,180 yen

Total Investment Units at
end of Fiscal Period

96,765 units

Total Investment Units at
end of Fiscal Period

96,765 units[Managing Assets]
Calculation based on 129 properties*, adding the 32 properties (scheduled to acquire
during the 3rd Fiscal Period as of January 21, 2008) to the 97 properties held as ofNovember 30, 2007 (end of 2nd Fiscal Period).
* As of February 28, 2008, the portfolio consists of 114 properties.
* URBAN STAGE Kawasaki, acquired February 26, 2008, is not included.

[Managing Assets]
Calculation based on 131 properties*, adding the 2 properties (scheduled to acquire
during the 4th Fiscal Period as of January 21, 2008) to the 129 properties held as of
May 31, 2008 (end of 3rd Fiscal Period).
* As of February 28, 2008, the portfolio consists of 114 properties.
* URBAN STAGE Kawasaki, acquired February 26, 2008, is not included.

[Depreciation]¥554 million is expected.

[Depreciation]¥644 million is expected.

[Loans]Assumed that loans as of May 31, 2008 (end of 3rd Fiscal Period) will be a total of¥53,870 million, through loans for the acquisition of new property already scheduled
as of January 21, 2008.

[Loans]Assumed that loans as of November 30, 2008 (end of 4th Fiscal Period) will be a totalof ¥58,718 million, with loans for the acquisition of new property already scheduled asof January 21, 2008.

13

Fund Management Results

14

Results of Investment (1) Acquisition from Nomura Real Estate Development
PROUD FLAT Shibuya Sakuragaoka(tentative name)Main Railway Access:5 minute walk to Shibuya Station on the JR Yamanote
and Saikyo Lines, Tokyo Metro Ginza and HanzomonLines, Tokyu Toyoko and Denentoshi Lines

Leasable Units:

30

Scheduled Acquisition Price: ¥800 million
Scheduled Acquisition Date: April 21, 2008 (3rd Fiscal Period)
Acquisition Route:

Nomura Real Estate Development Co., Ltd.

PROUD FLAT Shinjuku Kawadacho(tentative name)Main Railway Access:6 minute walk to Wakamatsu Kawada Station on the
Toei Subway Oedo Line
8 minute walk to Akebonobashi Station on the Toei
Subway Shinjuku Line

Leasable Units:

41

Scheduled Acquisition Price: ¥1,010 million
Scheduled Acquisition Date: April 21, 2008 (3rd Fiscal Period)
Acquisition Route:

Rent Level

In ¥120,000s for 1K units

Rent Level

AccessWithin walking distance of Shibuya Station, a large-scaletransfer station where 7 lines interchange.

AccessCommuting Time

Walking distance to Shibuya Station area
Approximately 20 minutes to other major business areas

Commuting Time

Nomura Real Estate Development Co., Ltd.

In ¥90,000s for 1R units
In ¥110,000s for 1DK units

Toei Subway Oedo Line and Shinjuku Line

Approximately 10 minutes to the Shinjuku area
Approximately 20 minutes to the Otemachi area

15

Results of Investment (1) Acquisition from Nomura Real Estate Development
PROUD FLAT Shinotsuka(tentative name)Main Railway Access:5 minute walk to Shinotsuka Station on the Tokyo Metro
Marunouchi Line and Otsuka Station on the JR
Yamanote Line

Leasable Units:

35

Scheduled Acquisition Price: ¥695 million
Scheduled Acquisition Date: April 21, 2008 (3rd Fiscal Period)
Acquisition Route:

Nomura Real Estate Development Co., Ltd.

PROUD FLAT Monzen Nakacho II(tentative name)Main Railway Access:7 minute walk to Monzen Nakacho Station on theTokyo Metro Tozai Line
11 minute walk to Monzen Nakacho Station on the
Toei Subway Oedo Line

Leasable Units:

35

Scheduled Acquisition Price: ¥650 million
Scheduled Acquisition Date: April 21, 2008 (3rd Fiscal Period)
Acquisition Route:

Rent Level

AccessCommuting TimeIn ¥100,000s for 1K units

Tokyo Metro Marunouchi Line and JR Yamanote Line

Approximately 20 minutes to Otemachi/Tokyo/Shinjuku areas
Approximately 10 minutes to the Ikebukuro area

Rent Level

AccessCommuting Time

Nomura Real Estate Development Co., Ltd.

In ¥90,000 for 1K units

Tokyo Metro Tozai Line and Toei Subway Oedo Line

Approximately 15 minutes to Otemachi/Nihonbashi areas
Approximately 30 minutes to the Roppongi area

16

Results of Investment (1) Acquisition from Nomura Real Estate Development
PROUD FLAT Shirogane Takanawa(tentative name)Main Railway Access:5 minute walk to Shirogane Takanawa Station on theTokyo Metro Namboku Line and Toei Subway Mita Line

Leasable Units:

106

Scheduled Acquisition Price: ¥3,510 million
Scheduled Acquisition Date: September 5, 2008 (4th Fiscal Period)
Acquisition Route:

Nomura Real Estate Development Co., Ltd.

PROUD FLAT Monzen Nakacho I(tentative name)Main Railway Access:5 minutes to Monzen Nakacho Station on the Tokyo
Metro Tozai Line
8 minutes to Monzen Nakacho Station on the Toei
Subway Oedo Line

Leasable Units:

55

Scheduled Acquisition Price: ¥1,130 million
Scheduled Acquisition Date: August 5, 2008 (4th Fiscal Period)
Acquisition Route:

Rent Level

In ¥120,000s for 1K units

Rent Level

AccessTokyo Metro Namboku Line and Toei Subway Mita Line

AccessCommuting Time

Approximately 15 minutes to the Roppongi area
Approximately 20 minutes to Otemachi/Akasaka areas

Commuting Time

Nomura Real Estate Development Co., Ltd.

In ¥100,000s for 1K units

Tokyo Metro Ttozai Line and Toei Subway Oedo Line

Approximately 15 minutes to Otemachi/Nihonbashi areas
Approximately 25 minutes to the Roppongi area17

Results of Investment (2) Acquisition from External Providers
PRIME URBAN Meguro Riverside

Main Railway Access:9 minute walk to Meguro Station on the JR Yamanote
Line, Tokyu Meguro Line, Tokyo Metro Namboku Line,and Toei Subway Mita Line

Leasable Units:

24

Scheduled Acquisition Price: ¥464 million
Scheduled Acquisition Date: September 27, 2007 (2nd Fiscal Period)
Acquisition Route:

Rent Level

PRIME URBAN Nishi Waseda

Main Railway Access:10 minute walk to Waseda Station on the Tokyo Metro
Tozai Line

Leasable Units:

28

Scheduled Acquisition Price: ¥503 million
Scheduled Acquisition Date: September 27, 2007 (2nd Fiscal Period)
Acquisition Route:

Existing provider

Existing provider

In ¥90,000s for 1K units

Rent Level

In ¥90,000s for 1K units

Tokyo Metro Tozai Line

Access

JR Yamanote Line, Tokyu Meguro Line, Tokyo Metro
Namboku Line, and Toei Subway Mita Line

AccessCommuting Time

Approximately 15 minutes to Ebisu/Shibuya areas
Approximately 20 minutes to Shinjuku/Roppongi areas

Commuting Time

Approximately 25 minutes to Otemachi/Nihonbashi areas
Walking distance to Waseda University and other schools

18

Results of Investment (2) Acquisition from External Providers
PRIME URBAN Karasuyama Galleria

Main Railway Access:2 minute walk to Chitose Karasuyama Station on the
Keio Line

Leasable Units:

33

Scheduled Acquisition Price: ¥645 million
Scheduled Acquisition Date: September 28, 2007 (2nd Fiscal Period)
Acquisition Route:

Existing provider

PRIME URBAN Karasuyama Court

Main Railway Access:8 minute walk to Chitose Karasuyama Station on the
Keio Line
7 minute walk to Roka Koen Station on the Keio Line

Leasable Units:

23

Scheduled Acquisition Price: ¥413 million
Scheduled Acquisition Date: September 28, 2007 (2nd Fiscal Period)
Acquisition Route:

Rent Level

In ¥100,000s for 1K units

Rent Level

Existing provider

In ¥90,000s for 1K units

AccessKeio Line (Extends on to Toei Subway Shinjuku Line)

AccessKeio Line (extends on to Toei Subway Shinjuku Line)

Commuting Time

Approximately 15-20 minutes to Shinjuku/Shibuya areas
Approximately 35 minutes to the Otemachi area

Commuting Time

Approximately 25 minutes to Shinjuku/Shibuya areas
Approximately 40 minutes to the Otemachi area

19

Results of Investment (2) Acquisition from External Providers
PRIME URBAN Meguro Ohashi Hills(tentative name)Main Railway Access:6 minute walk to Ikejiri Ohashi Station on the Tokyu
Denentoshi Line

Leasable Units:

99

Scheduled Acquisition Price: ¥3,580 million
Scheduled Acquisition Date: March 21, 2008 (3rd Fiscal Period)
Acquisition Route:

New provider

PRIME URBAN Denenchofu Minami(tentative name)Main Railway Access:14 minute walk to Tamagawa Station on the Tokyu
Toyoko and Meguro Lines
4 minute walk to Numabe Station on the Tokyu
Tamagawa Line

Leasable Units:

44

Scheduled Acquisition Price: ¥900 million
Scheduled Acquisition Date: March 21, 2008 (3rd Fiscal Period)
Acquisition Route:

Rent Level

In ¥130,000s for 1K units
In ¥200,000s for 1LDK units

Rent Level

AccessTokyu Denentoshi Line(extends on to Tokyo Metro Hanzomon Line)

AccessCommuting Time

Walking distance to Shibuya/Daikanyama areas
Approximately 25 minutes to the Otemachi area

Commuting Time

New provider

In ¥90,000s for 1K units

Tokyu Toyoko and Meguro Lines(extends on to Tokyo Metro Hibiya and Namboku Lines)
Approximately 30 minutes to the Shibuya area
Approximately 35 minutes to the Roppongi area

20

Results of Investment (2) Acquisition from External Providers
PRIME URBAN Nakano Kamitakada(tentative name)PRIME URBAN Minami Karasuyama

Main Railway Access:5 minute walk to Arai Yakushimae Station on the Seibu
Shinjuku Line

Main Railway Access:3 minute walk to Chitose Karasuyama Station on the
Keio Line

Leasable Units:

33

Leasable Units:

41

Scheduled Acquisition Price: ¥640 million

Scheduled Acquisition Price: ¥840 million

Scheduled Acquisition Date: March 3, 2008 (3rd Fiscal Period)

Scheduled Acquisition Date: September 28, 2007 (2nd Fiscal Period)

Acquisition Route:

Existing provider

Acquisition Route:

New provider

Rent Level

In ¥80,000s for 1K units
In ¥150,000s for 1LDK units

Rent Level

In ¥100,000s for 1K units

AccessCommuting Time

Seibu Shinjuku Line

Approximately 20 minutes to the Shinjuku area
Approximately 35 minutes to Otemachi/Nihonbashi areas

AccessKeio Line (extends on to Toei Subway Shinjuku Line)

Commuting Time

Approximately 20 minutes to Shinjuku/Shibuya areas
Approximately 35 minutes to the Otemachi area

21

Results of Investment (2) Acquisition from External Providers
URBAN STAGE Musashi Kosugi comodo

Main Railway Access:Leasable Units:

5 minute walk to Musashi Kosugi Station on the Tokyu
Toyoko and Meguro Lines
4 minute walk to Musashi Kosugi Station on the JR
Nambu Line
56

Scheduled Acquisition Price: ¥2,150 million
Scheduled Acquisition Date: September 28, 2007 (2nd Fiscal Period)
Acquisition Route:

New provider

Rent Level

In ¥170,000s for 2LDK units
In ¥190,000s for 3LDK units

URBAN STAGE Gyotoku Ekimae

Main Railway Access:7 minute walk to Gyotoku Station on the Tokyo Metro
Tozai Line

Leasable Units:

46

Scheduled Acquisition Price: ¥561 million
Scheduled Acquisition Date: December 4, 2007 (3rd Fiscal Period)
Acquisition Route:

Existing provider

Rent Level

In ¥70,000s for 1K units

Tokyo Metro Tozai Line

AccessTokyu Toyoko and Meguro Lines(extends on to Tokyo Metro Hibiya and Namboku Lines)

AccessCommuting Time

Approximately 20 minutes to Shibuya/Yokohama areas
Approximately 30-40 minutes to Roppongi/Otemachi areas

Commuting Time

Approximately 30 minutes to Otemachi/Nihonbashi areas

22

Results of Investment (2) Acquisition from External Providers
URBAN STAGE Minami Gyotoku V

URBAN STAGE Gyotoku

Main Railway Access:8 minute walk to Minami Gyotoku Station on the Tokyo
Metro Tozai Line

Main Railway Access:10 minute walk to Gyotoku Station on the Tokyo Metro
Tozai Line

Leasable Units:

38

Leasable Units:

77

Scheduled Acquisition Price: ¥293 million

Scheduled Acquisition Price: ¥948 million

Scheduled Acquisition Date: December 14, 2007 (3rd Fiscal Period)

Scheduled Acquisition Date: February 15, 2008 (3rd Fiscal Period)

Acquisition Route:Acquisition Route:

Existing provider

Existing provider

Rent Level

In ¥60,000s for 1K units

Rent Level

In ¥70,000s for 1K units

AccessTokyo Metro Tozai Line

AccessTokyo Metro Tozai Line

Commuting Time

Approximately 30 minutes to Otemachi/Nihonbashi areas

Commuting Time

Approximately 35 minutes to Otemachi/Nihonbashi areas

23

Results of Investment (2) Acquisition from External Providers
Benefis Kashii Verbena

Main Railway Access:Leasable Units:

8 minute walk to Kashii Station on the JR Kagoshima
Main and Kashii Lines
7 minute walk to Nishitetsu Kashii Station on the
Nishitetsu Kaizuka Line
39

Scheduled Acquisition Price: ¥396 million
Scheduled Acquisition Date: March 5, 2008 (3rd Fiscal Period)
Acquisition Route:

Rent Level

AccessCommuting Time

Benefis Hakata Higashi Grand Sweet

Main Railway Access:6 minute walk to Yoshizuka Station on the JR
Kagoshima Main and Sasaguri Lines

Leasable Units:

65

Scheduled Acquisition Price: ¥693 million
Scheduled Acquisition Date: March 19, 2008 (3rd Fiscal Period)
Acquisition Route:

Existing provider (Broker: Nomura Real Estate Urban Net)

Existing provider (Broker: Nomura Real Estate Urban Net)In ¥60,000s for 1DK units

JR Kagoshima Main Line and Nishitetsu Kaizuka Line

Approximately 20 minutes to the Hakata area
Approximately 40 minutes to the Tenjin area

Rent Level

AccessCommuting TimeIn ¥50,000s for 1R unitsIn ¥50,000-¥60,000s for 1DK units

JR Kagoshima Main Line

Approximately 10 minutes to the Hakata area24

Results of Investment (2) Acquisition from External Providers
Benefis Chihaya Grand Sweet

Portfolio as of the end of the 2nd FP(including scheduled acquisitions)

Number of Properties:

123

Total Acquisition Price: ¥100,281 million
Main Railway Access:5 minute walk to Chihaya Station on the JR Kagoshima
Main Line and Nishitetsu Chihaya Station on the
Nishitetsu Kaizuka Line

Leasable Units:

48

Scheduled Acquisition Price: ¥545 million
Scheduled Acquisition Date: March 28, 2008 (3rd Fiscal Period)
Acquisition Route:

Rent Level

Existing provider (Broker: Nomura Real Estate Urban Net)In ¥60,000s for 1LDK and 2K units

Portfolio as of the end of the 2nd FP

Number of Properties:

97

Total Acquisition Price: ¥75,420 million
AccessCommuting Time

JR Kagoshima Main Line and Nishitetsu Kaizuka Line

Approximately 15 minutes to the Hakata area
Approximately 30 minutes to the Tenjin area

25

Status of Portfolio (97 Properties at the end of 2nd Fiscal Period)

Diversification Within Assets

Improve portfolio stability
through promotion ofdiversification

Top 5 Properties¥10.93 billion

Top 10 Properties¥18.68 billion

Other 87 Properties¥56.74 billion

Building Age

Considering the combination ofvarious building age to avoid
concentration of large-scale
repair expenses in the futureOver 10 years

5-10 years

Total Portfolio
97 Properties/¥75.42 billion
3-5 years

Investment Area

Under 1 year

Other
Areas

Vicinityof Tokyo

Floor Area per Unit

1-3 years

Over
70 sq. meters

Retail & Office50-70 sq. meters
Other Areas

Vicinity of Tokyo
70% or more

(Kanagawa, Chiba,
Saitama)

For the time being, invest inproperties targeting
single/DINKS/young family
households

Other Areas
30% or less
Tokyo

Tokyo (23 wards)(excluding the 23 wards)

30-50 sq. meters

Nearest Station on Foot

Property selection focusing onaccessibility to the nearest
railway station

Over 10 min.

5-10 min.

Within 5 min.

Units per Property

Over 100 Units

Under
30 sq. meters

Under 30 Units

Invest in properties with up to
approximately 100 units,
allowing for 100% lease-up
within a short time-frame(Note) excludes sub-lease properties, etc.
50-100 Units

30-50 Units(Note) Of the graphs above, “Floor area per unit” is based on units, the others are based on acquisition price.

26

Result of Management (1) Portfolio Occupancy Rate

Stabilized around 96%

Occupancy Rate (%)
100.0

Leasable Floor Space (㎡)

95.4%

96.2%

96.4%

96.9%

95.9%

96.1%

95.8%

150,000

80.0

120,000

60.0

90,00040.0

60,00020.0

30,000

0.0

0

2007
May
(end of 1st FP)

2007
June

2007
July

Leasable Floor Space (㎡)2007
AugustVicinity of Tokyo

2007
September

2007
October

Other Areas

2007
November(end of 2nd FP)
Total(Note) The occupancy rate figures apply to the Total occupancy rate of the portfolio

Apply management which bring out the greatest potential for each property through the “selectionof optimal property management company for each property” and the “integrated operation
management with the asset management and property management companies”.

27Result of Management (2) Renovations

PRIME URBAN Yamahana (previously Presence S17)

URBAN STAGE Minami Gyotoku II & III

 Main details of renovations

 Main details of renovations⇒ Changing the signs (building nameplate, etc.), etc.

⇒ Change in floor covering (carpet→hard tile flooring)⇒ Enlarge parking space area

⇒ Renewal of fittings, washbasin faucets, and showerheads

Other Properties
URBAN STAGE Toritsu Daigaku
 Main details of renovations

URBAN STAGE Kachidoki
 Main details of renovations⇒ Change in floor covering (carpet→flooring)⇒ Change in room plan (2DK Japanese style→adjustable 1LDK unit)⇒ Renewal of prefabricated bath and system kitchen⇒ Change to flooring, renewal of prefab-bath & system kitchen

28

Results of Financing (Long-term/Fixed Interest-rate Ratio and LTV Ratio, etc.)

Long-term Interest-bearing Debt Ratio
Fixed Interest-rate Debt Ratio

Diversification of maturity(millions of y en)

15,000

Short-term

Floating Interest Rate

¥4.36 billion¥9.30 billion

11,00010,0005,440Long-term

Fixed Interest Rate

¥32.74 billion¥27.8 billion

4,500

5,000

4,000

3,500

3,360

2,200
(Note) “Fixed interest rate” includes floatinginterest rate borrowings which havebeen fixed through interest rate swaps.

1,000
0

3rd
FP

4th
FP

5th
FP

6th
FP

City Banks (3)Average remaining duration
at the end of the 2nd Fiscal Period*(November 30, 2007)

7th
FP

8th
FP

9th
FP

10th
FP

11th
FP

12th
FP

13th
FP

14th
FP

15th
FP

16th
FP

17th
FP

Diversification of Lenders

Loan to Value Ratio and Duration

LTV ratio at the end of the 2nd Fiscal Period(November 30, 2007)

1,300

800

45.9％

Regional Banks (2)Mitsubishi UFJ Trust and Banking Chiba Bank

Sumitomo Mitsui Banking

Sumitomo Trust and Banking

Mizuho Corporate Bank

Nomura Trust and Banking

Insurance Companies (4)3.6 years

Trust Banks (3)Bank of Tokyo-Mitsubishi UFJ

Iyo Bank

Others (2)Dai-ichi Mutual Live Insurance

Development Bank of Japan

Taiyo Life Insurance

Aozora Bank

Daido Life Insurance
Mitsui Sumitomo Insurance* Average remaining duration for long-term loans

4.0 years

29

ＡＰＰＥＮＤＩＸ

30

Portfolio (as of the end of the 2nd Fiscal Period)

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

Name of Property
PROUD FLAT Yoyogi Uehara
PROUD FLAT Hatsudai
PROUD FLAT Gakugei Daigaku
PROUD FLAT Meguro Gyoninzaka
PROUD FLAT Sumida Riverside
PROUD FLAT Kagurazaka
PROUD FLAT Waseda
PROUD FLAT Sangen Jaya
PROUD FLAT Kamata
PROUD FLAT Kiyosumi Shirakawa
PRIME URBAN Akasaka
PRIME URBAN Tamachi
PRIME URBAN Ebisu Minami
PRIME URBAN Yoyogi
PRIME URBAN Bancho
PRIME URBAN Chiyoda Fujimi
PRIME URBAN Iidabashi
PRIME URBAN Ebisu
PRIME URBAN Naka Meguro
PRIME URBAN Gakugei Daigaku
PRIME URBAN Senzoku
PRIME URBAN Meguro Riverside
PRIME URBAN Nishi Shinjuku I
PRIME URBAN Nishi Shinjuku II
PRIME URBAN Shinjuku Naitomachi
PRIME URBAN Nishi Waseda
PRIME URBAN Sangen Jaya
PRIME URBAN Minami Karasuyama
PRIME URBAN Karasuyama Galleria
PRIME URBAN Karasuyama Court
PRIME URBAN Shinagawa Nishi
PRIME URBAN Osaki
PRIME URBAN Omori

Location
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Chuo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Ota-ku, Tokyo
Koto-ku, Tokyo
Minato-ku, Tokyo
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Shibuya-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Chiyoda-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Meguro-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo

Percent of
Acquisition Price(Thousands of Yen) Total (%)
1,100,000
865,000
812,000
882,000
2,260,000
1,540,000
1,110,000
1,350,000
1,140,000
900,000
956,000
941,000
947,000
408,000
1,170,000
707,000
2,030,000
1,200,000
1,320,000
886,000
536,000
464,000
1,290,000
1,000,000
512,000
503,000
835,000
840,000
645,000
413,000
624,000
1,700,000
824,000

1.5
1.1
1.1
1.2
3.0
2.0
1.5
1.8
1.5
1.2
1.3
1.2
1.3
0.5
1.6
0.9
2.7
1.6
1.8
1.2
0.7
0.6
1.7
1.3
0.7
0.7
1.1
1.1
0.9
0.5
0.8
2.3
1.1

Leasable
Leasable Occupation Rate
Space (㎡) Units (Units) (end of 2nd FP)
1,151.34
958.98934.39855.23
3,055.21
1,793.43
1,450.91
1,277.82
1,541.64
1,209.56
1,062.05
1,107.36
881.89439.56
1,277.04
793.872,087.70
1,444.40
1,302.42
1,008.39
655.27453.77
1,459.86
1,162.55
578.18507.11
874.15
1,049.73
835.05576.20961.252,106.16
1,190.70

44
31
41
40
110
70
60
48
67
55
25
48
21
19
52
32
90
29
49
32
22
24
60
46
14
28
33
41
33
23
46
99
54

100.0
100.0
100.0
100.0
100.0
100.0
98.4
98.1
100.0
100.0
93.3
97.9
93.0
88.4
92.8
97.2
94.7
93.1
93.9
100.0
93.7
100.0
95.2
100.0
93.0
100.0
94.2
7.3
100.0
100.0
91.8
99.0
98.1

31

Portfolio (as of the end of the 2nd Fiscal Period)

#
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66

Name of Property
PRIME URBAN Kita Senzoku
PRIME URBAN Nishi Ogikubo
PRIME URBAN Otsuka
PRIME URBAN Monzen Nakacho
PRIME URBAN Kameido
PRIME URBAN Sumiyoshi
PRIME URBAN Kinshi Koen
PRIME URBAN Kinshicho
PRIME URBAN Hirai
PRIME URBAN Kasai
PRIME URBAN Kasai II
PRIME URBAN Urayasu
PRIME URBAN Gyotoku I
PRIME URBAN Gyotoku II
PRIME URBAN Gyotoku Ekimae
PRIME URBAN Nishi Funabashi
URBAN STAGE Azabu Juban
URBAN STAGE Hatagaya
URBAN STAGE Toritsu Daigaku
URBAN STAGE Kachidoki
URBAN STAGE Naka Ochiai
URBAN STAGE Ochiai
URBAN STAGE Roka Koen
URBAN STAGE Kamiuma
URBAN STAGE Sangen Jaya
URBAN STAGE Chitose Karasuyama
URBAN STAGE Sangen Jaya II
URBAN STAGE Komazawa
URBAN STAGE Karasuyama
URBAN STAGE Oimachi
URBAN STAGE Oimachi II
URBAN STAGE Yukigaya
URBAN STAGE Ikegami

Location
Ota-ku, Tokyo
Suginami-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Koto-ku, Tokyo
Sumida-ku, Tokyo
Sumida-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Edogawa-ku, Tokyo
Urayasu-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Funabashi-shi, Chiba
Minato-ku, Tokyo
Shibuya-ku, Tokyo
Meguro-ku, Tokyo
Chuo-ku, Tokyo
Shinjuku-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Setagaya-ku, Tokyo
Shinagawa-ku, Tokyo
Shinagawa-ku, Tokyo
Ota-ku, Tokyo
Ota-ku, Tokyo

Percent of
Acquisition Price(Thousands of Yen) Total (%)
576,000
435,000
794,000
2,200,000
705,000
552,000
1,180,000
668,000
700,000
637,000
958,000
840,000
635,000
741,000
476,000
772,000
991,000
452,000
524,000
2,290,000
655,000
324,000
362,000
900,000
755,000
730,000
539,000
396,000
344,000
530,000
1,100,000
970,000
1,460,000

0.8
0.6
1.1
2.9
0.9
0.7
1.6
0.9
0.9
0.8
1.3
1.1
0.8
1.0
0.6
1.0
1.3
0.6
0.7
3.0
0.9
0.4
0.5
1.2
1.0
1.0
0.7
0.5
0.5
0.7
1.5
1.3
1.9

Leasable
Leasable Occupation Rate
Space (㎡) Units (Units) (end of 2nd FP)
834.90543.09944.993,127.94
1,117.34
813.52
1,886.50
991.62
1,095.91
905.81
1,437.84
1,264.84
1,151.36
1,244.00
778.191,237.80
1,222.13
650.60996.81
4,481.82
1,237.98
517.53567.201,739.86
1,018.72
1,774.01
810.98572.41507.52722.701,719.82
1,536.59
2,456.48

46
24
46
117
52
40
77
49
53
45
68
60
52
58
37
60
40
38
16
144
18
32
34
37
47
27
17
26
28
45
92
94
95

93.5
100.0
95.7
98.3
100.0
100.0
100.0
100.0
90.5
84.4
98.5
98.3
90.4
100.0
94.6
96.7
94.8
100.0
93.9
93.4
100.0
96.8
97.1
99.1
98.2
96.2
87.1
96.9
89.8
91.1
97.8
94.6
100.0

32

Portfolio (as of the end of the 2nd Fiscal Period)

#
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97

Name of Property

Location

URBAN STAGE Nakano
Nakano-ku, TokyoURBAN STAGE Takaido
Suginami-ku, TokyoURBAN STAGE Komagome
Toshima-ku, TokyoURBAN STAGE Mukojima
Sumida-ku, TokyoURBAN STAGE Ekoda
Nerima-ku, TokyoURBAN STAGE Takinokawa
Kita-ku, TokyoURBAN STAGE Asakusa
Taito-ku, TokyoURBAN STAGE Machiya
Arakawa-ku, TokyoURBAN STAGE Koganei
Koganei-shi, TokyoURBAN STAGE Hino
Hino-shi, TokyoURBAN STAGE Musashi Kosugi comodo Kawasaki-shi, Kanagawa
URBAN STAGE Tsurumi Teraya
Yokohama-shi, Kanagawa
URBAN STAGE Tennocho
Yokohama-shi, Kanagawa
URBAN STAGE Urayasu
Urayasu-shi, Chiba
URBAN STAGE Minami Gyotoku I
Ichikawa-shi, Chiba
URBAN STAGE Minami Gyotoku II
Ichikawa-shi, Chiba
URBAN STAGE Minami Gyotoku III
Ichikawa-shi, Chiba
URBAN STAGE Minami Gyotoku IV
Ichikawa-shi, Chiba
URBAN STAGE Minami Urawa
Saitama-shi, Saitama
URBAN STAGE Yono Honmachi
Saitama-shi, Saitama
Cosmo Gracia Yotsuya Gaien Higashi
Shinjuku-ku, Tokyo
Vicinity of Tokyo (Sub Total 87 Properties)
PROUD FLAT Itsutsubashi
Sendai-shi, Miyagi
PRIME URBAN Yamahana
Sapporo-shi, Hokkaido
PRIME URBAN Kita Juyo Jo
Sapporo-shi, Hokkaido
PRIME URBAN Odori Koen I
Sapporo-shi, Hokkaido
PRIME URBAN Odori Koen II
Sapporo-shi, Hokkaido
PRIME URBAN Aoi
Nagoya-shi, Aichi
PRIME URBAN Esaka I
Suita-shi, Osaka
PRIME URBAN Esaka II
Suita-shi, Osaka
Benefis Hakata Grand Sweet
Fukuoka-shi, Fukuoka
Benefis Yakuin Minami
Fukuoka-shi, Fukuoka
Other Areas (Sub Total 10 Properties)

Total

Percent of
Acquisition Price(Thousands of Yen) Total (%)
472,000
1,080,000
412,000
487,000
385,000
287,000
350,000
210,000
229,000
319,000
2,150,000
457,000
136,000
277,000
357,000
285,000
263,000
256,000
274,000
519,000
1,700,000
69,806,000
682,000
377,000
336,000
530,000
322,000
724,000
672,000
790,000
830,000
351,000
5,614,000

75,420,000

0.6
1.4
0.5
0.6
0.5
0.4
0.5
0.3
0.3
0.4
2.9
0.6
0.2
0.4
0.5
0.4
0.3
0.3
0.4
0.7
2.3
92.6
0.9
0.5
0.4
0.7
0.4
1.0
0.9
1.0
1.1
0.5
7.4

Leasable
Leasable Occupation Rate
Space (㎡) Units (Units) (end of 2nd FP)
801.301,746.20
990.18
1,108.91
872.49554.39876.70455.19682.43994.683,690.37
952.06332.48437.94682.05611.61
543.84535.08694.05
1,372.74
1,759.61
100,646.28
1,861.56
1,518.58
1,155.60
1,850.20
1,148.72
1,571.04
1,189.12
1,392.00
2,176.23
897.84
14,760.89

51
107
19
55
35
29
22
26
27
54
56
50
20
27
41
37
33
32
32
70
51
4,074
60
33
36
53
36
46
48
57
67
34
470

90.9
94.5
100.0
92.8
97.4
90.5
100.0
92.5
97.2
88.9
98.4
98.0
90.0
100.0
100.0
75.7
58.1
90.7
97.0
100.0
95.4
95.4
97.3
94.5
93.6
100.0
100.0
98.1
100.0
100.0
98.5
100.0
98.2

100.0 115,407.17

4,544

95.8

33

Scheduled Acquisitions After the 2nd Fiscal Period
Scheduled Acquisitions Determined During the 1st Fiscal Period
Name of Property
PROUD FLAT Yokohama (tentative name)PRIME URBAN Hakusan
Vicinity of Tokyo (Sub Total 2 Properties)
PRIME URBAN Kita Juichi Jo (Note)
PRIME URBAN Miyanosawa (Note)
PRIME URBAN Odori Higashi (Note)
PRIME URBAN Chiji Kokan (Note)
PRIME URBAN Maruyama (Note)
PRIME URBAN Kita Nijuyo Jo (tentative name)PRIME URBAN Sapporo Idaimae
PRIME URBAN Kanayama (tentative name)PRIME URBAN Tsurumai (tentative name)
Other Areas (Sub Total 9 Properties)

Location

Scheduled
Leasable
Acquisition PriceSpace (㎡)
(Thousands of Yen)

Yokohama-shi, Kanagawa
Bunkyo-ku, Tokyo

Leasable
Units(Units)2,340,000
893,000
3,233,000
600,000
576,200
424,000
337,900
283,200
503,700
731,600
632,000
1,189,096
5,277,696

3,118.12
1,069.82
4,187.94
1,851.39
2,114.53
1,494.36
1,007.30
911.07
1,773.90
2,439.90
1,391.02
2,502.11
15,485.58

113
42
155
60
54
36
42
27
36
58
58
104
475

8,510,696

19,673.52

630

Scheduled
Leasable
Acquisition PriceSpace (㎡)
(Thousands of Yen)

Leasable
Units(Units)

Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Sapporo-shi, Hokkaido
Nagoya-shi, Aichi
Nagoya-shi, Aichi

Total 11 Properties

Scheduled
Acquisition Date
March 14, 2008
February 29, 2008
February 27, 2008
February 27, 2008
February 27, 2008
February 27, 2008
February 27, 2008
February 29, 2008
March 26, 2008
February 29, 2008
March 5, 2009

(Note) Acquisitions that have been completed by February 28, 2008.

Scheduled Acquisitions Determined During the 2nd Fiscal Period
Name of Property
PROUD FLAT Shibuya Sakuragaoka (tentative name)
PROUD FLAT Shinjuku Kawadacho (tentative name)
PROUD FLAT Shinotsuka (tentative name)
PROUD FLAT Monzen Nakacho II (tentative name)PRIME URBAN Meguro Ohashi Hills (tentative name)PRIME URBAN Denenchofu Minami (tentative name)PRIME URBAN Nakano Kamitakada (tentative name)
URBAN STAGE Gyotoku Ekimae (Note)
URBAN STAGE Minami Gyotoku V (Note)
URBAN STAGE Gyotoku (Note)
PROUD FLAT Shirogane Takanawa (tentative name)
PROUD FLAT Monzen Nakacho I (tentative name)
Vicinity of Tokyo (Sub Total 12 Properties)

Location
Shibuya-ku, Tokyo
Shinjuku-ku, Tokyo
Toshima-ku, Tokyo
Koto-ku, Tokyo
Meguro-ku, Tokyo
Ota-ku, Tokyo
Nakano-ku, Tokyo
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Ichikawa-shi, Chiba
Minato-ku, Tokyo
Koto-ku, Tokyo

800,000
1,010,000
695,000
650,000
3,580,000
900,000
640,000
561,000
293,000
948,000
3,510,000
1,130,000
14,717,000

638.701,102.20
752.09830.552,955.74
1,100.17
818.75927.33662.68
1,766.47
2,950.11
1,191.08
15,695.87

Scheduled
Acquisition Date

30
April 21, 2008
41
April 21, 2008
35
April 21, 2008
35
April 21, 2008
99
March 21, 2008
44
March 21, 2008
33
March 3, 2008
46 December 4, 2007
38 December 4, 2007
77 February 15, 2008
106 September 5, 2008
55
August 5, 2008
639

34

Scheduled Acquisitions After the 2nd Fiscal Period

Name of Property
Benefis Kashii Verbena
Benefis Hakata Higashi Grand Sweet
Benefis Chihaya Grand Sweet
Other Areas (Sub Total 3 Properties)

Location
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka
Fukuoka-shi, Fukuoka

Total 15 Properties

Scheduled
Leasable
Acquisition PriceSpace (㎡)
(Thousands of Yen)

Leasable
Units(Units)396,000
693,000
545,000
1,634,000

1,231.79
1,856.92
1,738.87
4,827.58

39
65
48
152

16,351,000

20,523.45

791

Scheduled
Acquisition Date
March 5, 2008
March 19, 2008
March 28, 2008

(Note) Acquisitions that have been completed by February 28, 2008.

Scheduled Acquisitions Determined After the 2nd Fiscal Period (as of February 28, 2008)
Name of Property
PROUD FLAT Kamioooka (tentative name)
URBAN STAGE Shinkawa (Note)
URBAN STAGE Hongo Ikizaka (Note)
URBAN STAGE Shinjuku Ochiai (Note)
URBAN STAGE Kamikitazawa (Note)
URBAN STAGE Kawasaki (Note)
Koganei Habitation (Note)
Musashino Green Hills (Note)
Vicinity of Tokyo (Sub Total 8 Properties)
PRIME URBAN Nagamachi Icchome (Note)
PRIME URBAN Yaotome Chuo (Note)
Other Properties (Sub Total 2 Properties)

Location
Yokohama-shi, Kanagawa
Chuo-ku, Tokyo
Bunkyo-ku, Tokyo
Shinjuku-ku, Tokyo
Setagaya-ku, Tokyo
Kawasaki-shi, Kanagawa
Koganei-shi, Tokyo
Koganei-shi, Tokyo
Sendai-shi, Miyagi
Sendai-shi, Miyagi

Total 10 Properties

Scheduled
Leasable
Acquisition PriceSpace (㎡)
(Thousands of Yen)

Leasable
Units(Units)2,770,000
2,250,000
647,000
635,000
738,000
1,150,000
2,390,000
1,590,000
12,170,000
1,110,000
428,000
1,538,000

4,872.17
3,600.61
662.581,053.39
1,384.45
1,706.46
5,999.80
2,970.50
22,249.96
3,411.24
1,380.21
4,791.45

200
46
27
28
29
80
98
78
586
60
43
103

13,708,000

27,041.41

689(Scheduled)
Leasable
Acquisition PriceSpace (㎡)
(Thousands of Yen)

Leasable
Units(Units)Scheduled
Acquisition Date
March 19, 2008
December 14, 2007
December 12, 2007
December 12, 2007
December 12, 2007
February 26, 2008
December 12, 2007
December 14, 2007
February 1, 2008
February 1, 2008

(Note) Acquisitions that have been completed by February 28, 2008.

Total of All the Mentioned Properties

Total Acquired Properties/Scheduled Acquisitions (133 Properties)

113,989,696

182,645.55

6,654

35

Interest-bearing Debts (at the end of the 2nd Fiscal Period)
Amount(Millions of Yen)

Type of Interest

Interest Rate

Date of Repayment

2 Financial Institutions

1,000

Floating Rate

1.08500%

February 26, 2008

3 Financial Institutions

3,360

Floating Rate

1.13667%

September 29, 2008

3 Financial Institutions

4,360

－

－

－

5 Financial Institutions

4,500

Floating Rate

1.17000%

August 27, 2009

6 Financial Institutions

5,000

1.46045%

February 27, 2010

1 Finacial Institution

440

1.14667%

February 27, 2010

6 Financial Institutions

3,500

1.84464%

September 30, 2011

7 Financial Institutions

11,0001.79300%

February 27, 2012

2 Financial Institutions

2,200

Fixed Rate

1.81375%

August 27, 2012

1 Finacial Institution

800

Fixed Rate

1.99875%

September 30, 2013

2 Financial Institutions

2,000

2.14360%

February 27, 2014

1 Finacial Institution

2,000

Fixed Rate

2.13625%

February 27, 2014

1 Finacial Institution

1,300

Fixed Rate

2.23500%

February 27, 2015

Long-term Loan
Sub Total

14 Financial Institutions

32,740

－

－

－

－

Total

14 Financial Institutions

37,100－－－－

LenderShort-term Loan
Short-term Loan
Sub Total

Long-term Loan

Fixed Rate
(Note 1)

Floating Rate
Fixed Rate
(Note 2)

Fixed Rate
(Note 1)

Fixed Rate
(Note 1)

Collateral
Unsecured
Unguaranteed－

Unsecured
Unguaranteed(Note 1) This loan has started the Interest Rate Swap transaction on February 27, 2007.
(Note 2) This loan has started the Interest Rate Swap transaction on May 31, 2007.

36

Unitholders (at the end of the 2nd Fiscal Period)

Number of Unitholders and Investment Units

Other Domestic Corporations(127 unitholders)Foreign Corporations(63 unitholders)Foreign
Corporations(4,927 units)

Individuals(9,970 units)

Financial Institutions(Including security companies)(129 unitholders)
Individuals(4,811 unitholders)

Total Number of Unitholders：5,130

Other Domestic Corporations(14,112 units)

Financial Institutions(Including security companies)(39,091 units)

Total Number of Investment Units：68,100 units

Top 10 Unitholders
Unitholders
1 Nomura Real Estate Development Co., Ltd.
2 Tokio Marine & Nichido Fire Insurance Co., Ltd.
3 NikkoCiti Trust and Banking Corporation
4 Japan Trustee Services Bank, Ltd.
5 The Master Trust Bank of Japan, Ltd.
6 North Pacific Bank, Ltd.
7 Trust & Custody Services Bank, Ltd.
8 The Bank of Ikeda, Ltd.
9 Asahi Fire & Marine Insurance Co., Ltd.
10 The Nomura Trust and Banking Co., Ltd.
Total

Units
12,500
5,000
4,892
4,800
3,060
2,203
1,826
1,471
1,323
1,035
38,110Ratio
18.36%
7.34%
7.18%
7.05%
4.49%
3.23%
2.68%
2.16%
1.94%
1.52%
55.96%

37

Organization of the Asset Management Company

Shareholders Meeting

Corporate Data of NREAM
Auditors
Name

Board of Directors

Nomura Real Estate Asset Management Co., Ltd.
Executive Director

EstablishedCompliance
Committee

Compliance & Risk
Management Group*

January 24, 2003

Capital¥300,000,000
OfficeManagement Division

ResidenceManagement Division
Shareholder

Investment
Committee

Investment
Committee

Nomura Real Estate Holdings, Inc. (100%)

Representative
Tatsuo Inoue, President & CEO
Acquisition
Group

Asset
Management
Group

Fund
Management
Group

Financial &Control GroupAcquisitionGroup■ Businessrelevant to due
diligence andacquisition ofproperties.
*Compliance & Risk Management Group■ Business relevant to the compliance, risk management,
and internal audits of the asset management company.

Asset
Management
Group

Fund
ManagementGroup■ Businessrelevant to theoperations,management,
and dispositionof real estate
undermanagement.

■ Businessrelevant to the
managementof the portfolio
of investment
assets anddisclosure (IR).

Financial &Control Group■ Businessrelevant to thefunding,accounting,taxation, andmanagementof capital forinvestment
assets.

Description of Business
Asset management business for investment
corporations (J-REITs)

Registration & Licenses■Registered for a financial instruments business:
Director of Kanto Local Finance Bureau No. 374■Licensed for discretionary proxy in realty trading:
Minister of Land, Infrastructure and Transport No. 18■Licensed for real estate trading:Governor of Tokyo No. (2) 81679

NRF Management Division38

Focus on ComplianceDecision making process proven through the listed REIT
 All projects require prior approval by the compliance officer before making proposal

Proposal toInvestment
Committee

 Transactions with related parties require approval by the Compliance Committee, including two external members(attorney/expert)

Resolution by theInvestment
Committee

 Unanimous vote by all members with voting rights (drafter and the compliance officer does not have voting rights)⇒ Heads of each division performs multifaceted reviews and analysis, and approves only if unanimous vote isreachedMain Items Examined

Main Items Examined■Deliberating the contents of the transaction withrelated parties.

■Selection of the Fund’s target acquisition proposals.

■Checking whether there are compliance related
issues through the process of examination or
investment decisions made by the Investment
Committee.

■The Fund’s asset management policy concerning
portfolio assets.

When there are no compliance related issues■The Fund’s policy concerning important items such as
financing, etc.

Committee■The Fund’s basic policy concerning investing andmanaging assets.

Compliance■Checking the state of compliance with laws,
regulations and rules related to the proposals.

Report on all deliberation minutes andinvestment decisions on the agenda

Residence Management Division Investment Committee

Decision Making

Checking the state of compliancewith laws, regulations and rules andwhether there are any transactions
with related parties

Compliance Officer

Proposal

Submission of proposal

Compliance Committee

Rules for transaction with related parties

Property Acquisition

 Acquisition price must meet or be lower than the appraisal value* by an independent real estate appraiser that is not a
related party*(Note) For uncompleted properties, appraisal value calculated by the real estate appraiser using appraisal methods

39This document has been prepared solely for the purpose of provision of information andshould not be construed as an offer, solicitation or commercial conduct of any natureassociated with any specific products. Investors wishing to purchase the investment unitsof Nomura Real Estate Residential Fund, Inc. should contact their own securities brokers
or dealers.
The forward-looking statements with respect to the future financial results contained in thisdocument should not be construed as a guarantee of the actual performance in the future.
Although the information contained in this document is intended to be complete andthorough, there is no assurance of precision and safety. Please note that the contents ofthis document is subject to change or cancellation without prior notice.
It is prohibited to make duplication, reproduction, distribution or use of any part or whole ofthe information contained in this document without express prior written consent.