September, 2008

daVinci Select K.K.

Business Results for the Fifth Fiscal Period,
Ended May 31, 20080

Disclaimer:z This presentation includes forward-looking statements about DA Office Investment

Corporation, daVinci Select, daVinci Holdings and daVinci Advisors and affiliatedcompanies (the Group). To the extent that statements in this presentation do not relate tohistorical or current facts, they constitute forward-looking statements. These forwardlooking statements are based on the current assumptions and beliefs of the Group inlight of current information and involve known and unknown risks, uncertainties andother factors. Such risks, uncertainties and other factors may cause actual performance
to be materially different from any future results, performance, achievements orfinancial position expressed or implied by these forward-looking statements.
z This document is not intended as an inducement or invitation to purchase or invest in

the products or investment shares of the Group. Nor is the document intended to provide
comprehensive information about the business performance and strategies of the Group.
Each investment decision requires the independent exercise of judgment in fully
reviewing the merits and risks. Investment decisions should not rely solely on theinformation contained herein and should consider multiple factors utilizing various
sources of information.
z The Group undertakes no obligation to publicly update any forward-looking statements

after the date of this presentation.
1

Investment Highlights¾ Status of refinancing..... Loan-to-Value (LTV) was slashed to 29.7% with the

prepayment of borrowings and other factors¾ Changes in the Operating Guidelines.....

(1) Clarification of the Investment Objectives(2) Clarification of the definition of assets to acquire(3) Development of a financial strategy¾ Development of a medium-term investment target.....

Set the medium-term Operational EPS target at 15,000 yen

21. Highlights of the Fifth Fiscal Period

3

Fifth Fiscal Period Highlights■ Results for the Fifth Fiscal Period
Results
Results (33(33 Properties)
Properties)■ Forecasts
ChangeChange fromfrom Previous
Previous Period
PeriodSixth
Sixth Period
Period (30(30 properties)
properties) Seventh
Seventh Period
Period (30(30properties)
properties)(Disclosed as of August 15, 2008)(Disclosed as of July 24, 2008)

OperatingOperating Revenue
Revenue¥10,230¥10,230 MM++ ¥1,676¥1,676 M
M+19.6%+19.6%¥15,272¥15,272 M
M¥8,602¥8,602 M
M

OperatingOperating Income
Income¥6,235¥6,235 MM++ ¥1,018¥1,018 M
M+19.5%+19.5%¥10,846¥10,846 M
M¥4,402¥4,402 M
M

Net
Net Income
Income¥3,951¥3,951 M
M-- ¥¥403
403 M
M

--9.3
9.3%
%

¥9,104¥9,104 M
M¥3,223¥3,223 M
M

Dividend
Dividend per
per Unit
Unit¥19,277¥19,277-- ¥¥1,968
1,968-- 9.3%
9.3%¥26,475¥26,475¥9,372¥9,372¥6,320¥6,320¥9,372¥9,372

Operational EPS (net income per investment unit excluding capital gain/loss)

M = million■ Review of the Fifth Fiscal Period¾ Announcement of a private placement of new investment units (the payment

date was June 4, 2008)¾ A reduction in refinancing risk with the prepayment of borrowings¾ Achievement of the internal growth target (total rent increase of 3.5% or more)¾ Newly appointed representative of the asset management company

4

2. Financial Strategy

5

Financial Highlights■ Highlights of the Fifth Fiscal Period after the private placement of new investment units
LTV was slashed significantly after the private placement of new investment units, thanks to the prepayment of borrowings and the early
redemption of investment corporation bonds.
Financial Highlights
LTV* (%)

Balance (million yen)

Announcement of private
placement of new investment
units (May 14, 2008)

80

70

60

160,000

LTV was slashed substantiallywith prepayment
The refinancing risk was slashed59%

140,000

58%
54%

54%

52%

50

43%

40

154,949

New borrowings of 5.5 billion yen(three-year fixed rate, collateralized)
from Kansai Urban Banking Corp.

31%

147,895

120,000

34%

100,000

29%

30
123,395

80,00020
93,895

10

77,00088,395

84,11078,77060,00060,300End ofFirst
PeriodEnd ofSecondPeriodEnd ofThird
PeriodEnd ofFourthPeriodEnd ofFifth
PeriodJune 5,2008

June 6,2008

June 30,2008

September 8,
2008* LTV is on the basis of the acquisition price6

Background of Private Placement of New Investment Units
Chart 1: Rise in financing costs

As of May 15, 2008, some 107,625 million yen (approx. 77.9% of totaldebt) in interest-bearing debt of an approximate total of 140 billion yen
owed by the Investment Corporation was to become due by year end.
The Investment Corporation recognized that the refinancing risk of thisinterest-bearing debt was a critical issue affecting its investment unit
price.

Rise in costs with the turbulencein the financial market(Rate of rise %)

1.8
1.6
1.4
1.2
1
0.8
0.6
0.4
0.2
0

Looking at the financing environment, meanwhile, given the massive
impact of the sub-prime loan crisis on the finances of foreign financial
institutions in particular, the spreads required by securitization lenders
that had until recently occupied important positions in the borrowingsof the Investment Corporation were increasing much more thaninitially anticipated, and it became very difficult to refinance debts at alow cost.

Average financing cost
Average base rate

123
45 (Fiscal period)
May ‘06
Nov ‘06
May ‘07
Nov ‘07
May ‘08(Note) Average financing cost includes all the financing fees. The rate of rise since the first fiscal period is schematized.
The average base rate is a simple average of the three month TIBOR at the time when interest rates changed. The
rate of rise since the first fiscal period is schematized.

Although the Investment Corporation had been stepping up the
prepayment of borrowings, assuming that the environment describedabove will continue for the time being, spreads requested by financial
institutions were further rising.

Chart 2: Refinance risk (as of May 15)
Risk associated with the concentration of
repayment dates (Orange portions are to berefinanced by December 3, 2008)(Unit: 100 million yen)

After reviewing all of the measures that would improve this situation in
the current financing environment and considering the timing and thecertainty of the financing we intended to obtain, we determined that themost appropriate approach was a private placement of new investment
units based on the judgment that refinancing through borrowing only
would substantially increase costs. Based on this, we decided to conduct
a private placement (the “private placement”) with K.K. Columbus (the“Subscriber”), a wholly owned subsidiary of daVinci Advisors(Current: daVinci Holdings), and to appropriate the proceeds to therepayment of borrowings and the redemption of investment
corporation bonds (collectively, the “Debt Repayments”).

700
600
Repayment amount

500
400
300
200
100
0
Nov.
2008

May
2009

Nov.
2009

May
2010

Nov.
2010

May
2011

Repayment year

7

Nov.
2011

May
2012

Nov.
2012

Execution of Private Placement and Financing Activities■ Summary of private placement and profile of subscriber ■ Prepayment and collateralization
Summary of the private placement

Improving financial health⇒ LTV was slashed to 29.7%, thanks to prepayments, etc.

⇒ To reduce refinancing risk, the private placement was as follows.

Date ofimplementation

Item

OutlineNumber of Investment
Units to Be Issued

138,905 units (Number of investment units outstanding: 343,905
units)

June 5, 2008

Issue Price/Total Issue
Price

431,949 yen per unit (Total issue price: 59,999,875,845 yen)

June 6, 2008

Subscriber and Numberof Units Allotted

K.K. Columbus(Number of units allotted: 138,905 units)

OutlinePrepayment of 24,500 million yen to Nomura Capital Investment
Prepayment of 30,000 million yen to Lehman Brothers Commercial Mortgage
and repurchase of investment corporation bonds of 5,000 million yen for
retirement
Prepayment of 8,625 million yen to Citibank Japan and repurchase of

July 18, 2008
Payment Date

June 4, 2008

retirement/repayment of 4,500 million yen to Aozora Bank

Outline of the Subscriber

June 30, 2008

⇒ A profile of the subscriber is as follows.
Item
Corporate NameBusinesses

investment corporation bonds of 3,000 million yen for the

New borrowings of 5.5 billion yen from Kansai Urban Banking Corporation(long-term debt: 3 years)
Borrowings of 5.5 billion yen from Aozora Bank (long-term debt: 1.5 years)

August 29, 2008

OutlineBorrowings of 3 billion yen from Resona Bank (long-term debt: 3 years)

K.K. Columbus (An interested party, etc. with respect to the asset
management company)

September 2, 2008

(1) Execution of silent partnership (tokumei kumiai) agreements
and management of assets invested thereby(2) Acquiring, holding and selling securities(3) Any business incidental or related to any of the above

Date of incorporation

November 2, 2007

Representative

Tsutomu Koyama, President and Representative Director

Stated Capital

100,000,000 yen

Major Shareholders, etc.

daVinci Advisors K.K. (100%)(Current: daVinci Holdings)

Borrowings of 5 billion yen from American Life Insurance Company (longterm debt: 5 years)

Collateralized borrowings⇒ The policy was changed to collateralized borrowings that increasenegotiation options.
⇒ Security was created on existing uncollateralized loans in accordancewith the provisions of the loan agreements.
(The credit rating was changed to A from A+ due to collateralization)

8

Future Financial Strategies■ Financial Strategy
The Investment Corporation will conduct financing activities based on the policies below.
(1) Conduct leveraged control to confine LTV within an upper limit of 40-50%(3) Extend the due dates of borrowings so that the ratio of
long-term debt will be more than the lower limit of 60-70%(2) Diversify payment dates so that the total balance of interest-bearing debt
that comes due in any one period will be less than 20 billion yen(upper limit benchmark)(4) Diversify lenders centering on domestic financial institutions

Financing activities in the future (As of September 8, 2008)
Balance of interestbearing debt

(Million yen)

Available cash 12 billion yen

To be repaid
this year

Plan to refinance

30,00025,000Investment Corporation
Bonds:

20,000Plan to refinance by
diversifying them into
three periods (Currently
negotiating with financial
institutions)

Plan to refinance by diversifying them into three periods(currently negotiating with financial institutions)Upper limit benchmark per period ((2) above)

Planned

5,000

15,000PlannedPlanned

4,448
10,00022,000Currently
negotiating
5,000

１００

Shinsei Bank:
13,822

１００

3,000

１００

10,000
5,500

5,500

2,500
Nov. 2008(Sixth period)

5,000

2,000
May 2009(Seventh period)

Nov. 2009(Eighth period)

May 2010(Ninth period)

Nov. 2010(Tenth period)

9

May 2011(Eleventh period)

Nov. 2011(Twelfth period)

May 2012(Thirteenth period)

Nov. 2012(Fourteenth period)

May 2013(Fifteenth period)

Nov. 2013(Sixteenth period)3. Investment Strategies in the Future

10Investment Strategies in the Current Fiscal Period
Achieve a stablefinancial basis.

Achieve steadyinternal growth.

High¾ Extend the debt duration.
¾ Diversify payment dates.
¾ Diversify lenders.

¾ Increase rent revisions(closing the rent gap).
¾ Maintain highoccupancy rates.
Priority

Achieve external growth throughprudent property selection.
¾ Focus investment on the five

central wards of Tokyo.
¾ Select properties with internal

growth potential.

11

Low

Medium-Term Investment Target■ Investment Objectives

Achieve mid-to-long term Operational EPS growth.
■ Medium-Term Investment Target

Aim to increase Operational EPS to the
15,000’s over the medium term
- Internal growth: Grow the total
rent at an annual rate of 6%.
- External growth: Increase the asset
size to 350 billion yen.

Operational EPS

15,000’s

Operational
EPS
9,372 yen

Operational
EPS
6,320 yen～～

Forecast for sixth Forecast for seventh
period (ended
period (ended
November 30, 2008) May 31, 2009)12

Medium-term target

4. Internal Growth13Results of Rent Revisions in the Fifth Fiscal Period■Increased Rate Revisions (for a total of 321 tenants in 33 properties at the end of the fifth fiscal period)
Below is the status of increased rent revisions since December 1, 2007 at 33 properties owned by the Investment Corporation at the end of the fifth fiscal period.

Tenants not subject to rent revisions

Tenants subject torent revisions

84.7%

15.3%

■ Rent increase at tenants subject to revisions
Breakdown of rent increase

14.0%

49

272

Breakdown
Tenants for rent
revisions
Tenants with newcontracts(11 tenants withnew contracts)

Rent
increase

12.6%
36.0%

■Total rent increase
Tenants continuing
previous contract terms

Tenants in rent revision negotiations

8.2%

91.8%

4

45 (11 tenants with new contracts)

Achieved a total target
rent increase for the fifth
period of “Up 3.5% fromthe fourth period!!”
period!!”《Changes in the rate of increase》
(％)

3.8%
3.9%

4
3

Tenants accepting rent increases

100%

2.1%

2.4%

2
1

45 (11 tenants with new contracts)

0Second period

T hird period

The total rate of rent increase (%) = total monthly rent at fifth period-end - (total monthly rent at fourth period-end – total monthly rent at fourth period-end for properties soldduring the fifth period) / (total monthly rent at fourth period-end – total monthly rent at fourth period-end for properties sold during the fifth period)

14

Fourth period

Fifth period

Status of Rent Gap
Difference between the current rent and the market rent (rent gap) for properties owned by the Investment Corporation
Area

Property nameCurrent rent
(May 2008)

Market rent
(Nov. 2007)

Market rent
(May 2008)

Market rentchange (%)

Rent gap rate
(Nov. 2007)

Rent gap rate
(May 2008)

daVinci Ginza

28,64835,00035,0000.00%

23.67%

22.17%

daVinci Nihonbashi Honcho

21,97928,00028,000daVinci Ginza Annex

24,00430,00030,0000.00%

31.80%

24.98%

daVinci Ginza 1-chome

27,34032,000daVinci Kamiyacho

26,13831,00031,0000.00%

27.04%

18.60%

daVinci Kyobashi

19,17022,000Sunline 7 Bldg.

22,731

18,62521,00020,000-4.76%

14.50%

7.38%

daVinci Minami Aoyama

29,10835,00034,000-2.86%

20.24%

16.81%

daVinci Mita

20,37723,00023,0000.00%

22.62%

12.87%

daVinci Sarugakucho

20,07521,00022,00021,00022,000

0.00%
0.00%

15.70%
10.60%

18.78%
39.15%

5.39%

5.39%

9.59%

daVinci Kodemmacho

15,42018,00018,0000.00%

16.73%

16.73%

Subtotal

25,45532,57232,507-0.20%

34.41%

27.70%

15.70%

1.93%
12.17%

19,00019,000

0.00%

5.07%

5.07%

12,62817,00017,0000.00%

34.62%

34.62%

33.84%

25.51%

0.00%

18,083-5.26%

0.00%

33,000BPS Square

18,00027,00033,000daVinci Tsukiji

19,00014.76%

27,00031,312

8.69%

15,58817.04%

17.60%SHIBUYA EDGE

31.81%

daVinci Tsukiji 616

17.35%

0.00%

26.97%

8.69%

13.32%

0.00%

22,00044.69%

31.81%

0.00%

32,00043.69%

0.00%

19,00027.39%

0.00%

0.00%

19,00049.30%

0.00%

25,00016,9380.00%

45,00024,000daVinci Shimbashi 510

Rent gap rate
(May 2008)

30,00025,0004.42%

Rent gap rate
(Nov. 2007)

45,00024,000-2.38%

Market rentchange (%)

30,00018,967

20,500Market rent
(May 2008)

32,34022,08221,000Market rent
(Nov. 2007)

23,627

daVinci Shibadaimon

20,111

Current rent
(May 2008)

daVinci Onarimon

daVinci Jingumae

daVinci Misakicho

Property nameShinjuku Maynds Tower

15.47%

Tokyo metropolitan area andregional major cities

Five central wards of Tokyo

daVinci A Hamamatsucho

18,150Five central wards of Tokyo

daVinci Shibaura

Area

daVinci Kinshicho

12,12416,00016,0000.00%

31.04%

31.97%

daVinci Higashi-Ikebukuro

14,33316,00016,0000.00%

12.72%

11.63%

Bennex S-3

14,771

15,00015,000

0.00%

2.28%

1.55%

Believe Omori

17,08919,00019,0000.00%

11.18%

11.18%

daVinci Shinagawa II

18,90821,00022,0004.76%

15.56%

16.35%

daVinci Minami-Senba

12,641

14,00014,0000.00%

10.75%

10.75%

Subtotal

15,052

16,761

16,964

1.21%

12.86%

12.70%

23,561

29,69329,677-0.05%

31.83%

25.96%

Shuwa Tsukishima Bldg.

16,05516,00016,5003.13%

13.90%

2.77%

Nihonbashi MS Bldg.

16,06920,00020,0000.00%

24.46%

24.46%

Atlantic Bldg.

17,56721,00020,000-4.76%

25.04%

13.85%*1 Current rent is calculated based on the rent level on May 31, 2008 for offices above the second floor

Shibuya SS Bldg.

25,87630,00030,0000.00%

33.36%

15.94%*2 Market rent is based on assessments prepared in market reports by Tokyu Livable, Inc., a leading Japanese leasing agency.

Total*3 Rent gap rate = (Market rent – Current rent) / Current rent
*4 Subtotal, total rent, rate of change in rent, and rent gap rate are weighted averages using floor areas15

5. External Growth16External Growth Target■ Changes in the underlying trends of the real estate market¾ Subprime mortgage loan crisis-Prioritize financial stability inlight of current market
conditions.
-The rise in property prices isslowing.
-Moderating the aim for an asset
size of 350 billion yen in themedium term.

- Withdrawal of foreign-affiliated lenders from the financial market- Rise in required spreads- Selection of borrowers by lenders¾ Revision of the Building Standards Law- Tighter screening standards for properties¾ Introduction and amendment of Financial

Instruments and Exchange Law- Increase in administrative costs■ External growth target
287 billion yen

278.7 billion yen

Total assets
Total acquisition
138.4 billion yen
price
130.4 billion yen
110.8 billion yen～～

End of First
Period350 billion yen

End of Second
PeriodEnd of Third
PeriodEnd of Fourth
PeriodEnd of Fifth
Period17

Medium-term target

September, 2008

daVinci Select K.K.

Appendix18

Major Financial Data

Ite m

Unit

1s t pe riod 2nd pe riod 3rd pe riod 4th pe riod 5th pe riod

Day

223

183

182

183

183

P ropert y

33

37

34

35

33

%

97.4

97.5

99.0

98.2

98.3

Million yen

89,028

121,547

138,883

199,274

286,162

NOI (afte r de duction of gain from s ale ) Million yen

3,144

3,209

3,920

5,062

6,827

Million yen

2,283

2,307

2,638

3,492

3,674

Numbe r of days of inve s tme nt
Numbe r of prope rtie s at e nd of pe riod
Occupancy rate at e nd of pe riod
Ave rage acquis ition price

Funds from ope ration (FFO)
NOI yie ld

%

5.8

5.3

5.7

5.1

4.8

Re turn on as s e t (ROA)

%

2.9

3.2

4.2

1.9

1.3

Re turn on e quity (ROE)

%

5.2

7.8

11.3

4.7

3.0

Capital ade quacy ratio at e nd of pe riod

%

43.4

37.5

36.1

44.0

44.8

Loan-to-Value (LTV) at e nd of pe riod

%

51.2

55.9

57.7

51.2

49.9

30

FFO:
Net income + Depreciation – Gain from sale
NOI yield:
Annualized NOI / Average Acquisition Price
ROA:
Annualized Net Income / Total Assets
ROE:
Annualized Net Income / Total Investments
LTV:Interest-bearing debt at end of period / Total
assets at end of period* Figures are rounded to the first decimal place.

■Long-Term Debt and Fixed-Rate Borrowing Ratios■ Ratios of long-term and short-term borrowings■ Ratios of floating-rate and fixed-rate borrowings

The ratio of long-term debt rose from 33.1% to 68.9% due to the
prepayment of short-term borrowings and the execution of new
long-term debt.

The ratio of fixed-rate borrowings rose from 28.1% to 53.3% with the
prepayment of floating-rate borrowings and the introduction of new
fixed-rate borrowings.

Ratios of long-term and short-term borrowings

Ratios of floating-rate and fixed-rate borrowings

As of May 31, 2008 (end of the fifth period)

As of May 31, 2008 (end of the fifth period)
Long-term debt
48,895 million yen
Short-termborrowings (*)
99,000 million yen
66.9%

Fixed-rate
41,448 million yen
28.0%

Floating-rate
92,625 million yen
62.6%

33.1%

Floating-rate (hedged with caps)
13,822 million yen 9.3%
Balance: 147,895 million yen

Balance: 147,895 million yen

As of September 8, 2008

As of September 8, 2008
Long-term debt
Short-termborrowings (*)
32,000 million yen
31.1%

Floating-rate

46,770 million yen

23,000 million yen

68.9%

29.2%

Balance: 78,770 million yen

Fixed-rate
41,948 million yen
53.3%
Balance: 78,770 million yen

Floating-rate (hedged with caps)* Including investment corporation bonds.

13,822 million yen 17.5%

20

Summary of Results for Fifth Fiscal Period (1)■ Comparison with results of the previous period[Assumptions for analysis] (Unit: Million yen)

Unit: Million yen (excluding the number of investment units and cash dividends)
Fourth period

Fifth period(Ended November
30, 2007)(Ended May 31,
2008)

ChangeNumber of properties (period-end)

35

33

-2

Effective number of days of investment

183

183

I. Comparison with the fourth period on the basis of properties
owned at the end of the fourth period (28 properties, excluding
properties sold during the fifth period)
II. Other factors[Operating revenues]

Operating revenues (A)8,553

10,230+ 1,676

Gains on sales

1,919

1,552

- 367

I. 103 [Increase in rent, etc. 4,899(5th period) - 4,795 (4th period)]

Operating expenses (B)

3,336

3,994

+ 657

II. 2,100 [Rent, etc. from properties acquired in the fourth period],

Rental business expenses (excluding
depreciation)

1,500

1,783

+ 282

Depreciation

1,056

1,275

+ 218

Income and loss from rental operations(excluding gains on sales)

4,077

5,619

+ 1,542

I. - 232 [ 773 (5th period) - 1,005 (4th period) / Of which, taxes andpublic dues of 223]

Operating income (A-B)

5,217

6,235

+ 1,018

II. 553 [Rental business expenses, etc. for properties acquired in the
fourth period],

Non-operating expenses

1,006

2,295

+ 1,288

581

1,073

+ 492

Ordinary income

4,214

3,952

- 261

Net income

4,355

3,951

- 403

205,000

205,000

21,245

19,277

Interest expense (including amortizationof caps)Number of investment units outstanding
Dividend per unit (unit: yen)

- 92 [Rent, etc. from properties sold during the fifth period]- 1,968

21[Rental business expenses]- 11 [ Rental business expenses, etc. for properties sold during thefifth period][Interest expense]-

467 [Average principal: 84,958 (4th period) → 152,012 (5th period)]-

25 [Average interest rate: 1.37% (4th period) → 1.41% (5th period)]

Summary of Results for Fifth Fiscal Period (2)■ Comparison with results forecast
Unit: Million yen (excluding the number of investment units and cash dividends)
Fifth period
Forecast
announced on
January 11, 2008

Actualresults

Difference[Rental Operations]: Based on earnings fromOperating revenues (A)10,176

10,230+ 53

property rental operations excluding gains on sales

Gains on sales

1,603

1,552

- 51

182 increase in income

Operating expenses (B)

4,154

3,994

- 160

(1) 67 [18: Exit penalty, 41: Gains from restitution expenses]

Rental business expenses (excluding
depreciation)

1,790

1,783

-7

Depreciation

1,344

1,275

- 69

Income and loss from rental operations(excluding gains on sales)

5,437

5,619

+ 182

Operating income (A-B)

6,021

6,235

+ 214

Non-operating expenses

2,121

2,295

+ 173

1,129

1,073

- 55

Ordinary income

3,899

3,952

Net income

3,897

3,951

205,000

205,000

19,013

19,277(2) - 76 [- 69: Depreciation, - 15: Taxes and public dues]■Changes in results forecast
Initial forecast

Interest expense (including
amortization of caps)

Number of investment units outstanding
Dividend per unit (unit: yen)

(Million yen)

Revisedforecast(Announced on(Announced onJune 15)January 11)

Actual results

Difference
from initial
forecast

Operating revenues

6,805

10,176

10,230+ 3,425

Ordinary income

2,673

3,899

3,952

+ 1,279+ 52

Net income

2,669

3,897

3,951

+ 1,282+ 53

Dividend per unit (yen)13,022

19,013

19,277+ 6,255+ 264

22

Sold on April 18(1 property)

Results Forecast (Sixth and Seventh Fiscal Periods)■ Results forecast for the sixth and seventh fiscal periods
Unit: Million yen (excluding the number of investment units and cash dividends)

Fifth period(Ended May 31,
2008)[Assumptions for forecast] (Unit: Million yen)

Forecast forthe sixth
period (ending
November 30,
2008)

Forecast forthe seventh
period (ending
May 31, 2009)- Sold on June 30 … daVinci Mita
- Sold on July 17 … Believe Omori- Sold on September 2 … daVinci Kamiyacho

Number of properties (period-end)

33

30

30

Effective number of days of investment

183

183

182

Operating revenues (A)10,23015,272

8,602

Gains on sales

1,552

6,931

0

Operating expenses (B)

3,994

4,425

4,199

Rental business expenses (excluding
depreciation)

1,783

2,095

1,987

Depreciation

Compared with the fifth period- Average assets under management:
286,162 (5th period) → 272,452 (6th period)[Gains on sales]
1,275

1,228

1,241

Income and loss from rental operations (excluding
gains on sales)

5,619

5,016

5,373

Operating income (A-B)

6,235

10,846

4,402

Non-operating expenses

2,295

1,739

1,177

1,073

663

805

Ordinary income

3,952

9,106

3,225

Net income

3,951

9,104

3,223

205,000

343,905

343,905

Dividend per unit (unit: yen)

19,277

26,475

9,372

Operational EPS (unit: yen)

-

6,320

9,372

Interest expense (including amortization of caps)

Number of investment units outstanding

The following changes in properties are factored into property numbers:* Although we assume that rents will remain at the current level, actual rents may differ from theassumption depending on the status of assets under management.

23

The above three properties sold (6th period)

■List of Interest-Bearing Debt (1)■ List of interest-bearing debt (As of May 31, 2008)
Term

Short termLong term

LenderBalance(million yen)Type ofinterest rate

Interest rate(%)

Date of advanceDue date

Lehman Brothers Commercial Mortgage

30,000Floating rate

1.359%

Dec. 3, 2007

Dec. 3, 2008

Nomura Capital Investment Co., Ltd.

11,000Floating rate

1.179%

Jul. 31, 2007

Jul. 31, 2008

Aozora Bank, Ltd.

4,500

Resona Bank, Limited

3,000

Floating rate

1.243%

Aug. 31, 2007

Aug. 29, 2008

Nomura Capital Investment Co., Ltd.

13,500Floating rate

1.179%

Nov. 26, 2007

Jul. 31, 2008

Shinsei Bank, Limited

2,500

Floating rate

1.243%

Nov. 26, 2007

Nov. 28, 2008

Aozora Bank, Ltd.

4,500

Floating rate

1.369%

Mar. 21, 2008

Jul. 18, 2008

Total short-term borrowings

69,000American Life Insurance Company

5,000

Fixed rate

1.700%

Oct. 21, 2005

Oct. 21, 2012

Aozora Bank, Ltd.

4,448

Fixed rate

0.929%

Jan. 27, 2006

Jan. 27, 2009

GE Real Estate - Japan

5,937

UBS Securities Japan Limited

2,850

Sompo Japan Insurance Inc.

2,470

Mizuho Bank, Ltd.

1,425

Floating rate

1.643%

Oct. 23, 2006

Sep. 18, 2009

The Iyo Bank, Ltd.

570

Tokyo Leasing Co., Ltd.

570

Citibank Japan Ltd.

8,625

Floating rate

1.343%

Nov. 26, 2007

Dec. 25, 2008

Aozora Bank, Ltd.

10,000Floating rate

1.343%

Nov. 26, 2007

May 26, 2009

Shinsei Bank, Limited

5,000

Floating rate

1.343%

Nov. 26, 2007

Nov. 30, 2009

Resona Bank, Limited

2,000

Fixed rate

1.591%

Mar. 21, 2008

Mar. 21, 2011

Total long-term debt

48,895#1 Unsecured Investment Corporation Bond

30,000

Fixed rate

1.500%

Nov. 26, 2007

Nov. 28, 2008

Total interest-bearing debt

147,895* Borrowings in blue were prepaid or repaid before July 18, 2008. Some of the borrowings in red wererepurchased and retired.

24

■List of Interest-Bearing Debt (2)■ List of interest-bearing debt (As of September 8, 2008)

Term
Short termLong term

LenderBalance(million yen)

Shinsei Bank, Limited

2,500

Total short-term borrowings

2,500

Aozora Bank, Ltd.

4,448

GE Real Estate - Japan

5,937

UBS Securities Japan Limited

2,850

Sompo Japan Insurance Inc.

2,470

Mizuho Bank, Ltd.

1,425

The Iyo Bank, Ltd.

570

Tokyo Leasing Co., Ltd.

Type ofinterest rate

Interest rate(%)

Floating rate

1.243%

Nov. 26, 2007

Nov. 28, 2008

Fixed rate

0.929%

Jan. 27, 2006

Jan. 27, 2009

Floating rate

1.643%

Oct. 23, 2006

Sep. 18, 2009

Date of advanceDue date

570

Aozora Bank, Ltd.

10,000Floating rate

1.343%

Nov. 26, 2007

May. 26, 2009

Shinsei Bank, Limited

5,000

Floating rate

1.343%

Nov. 26, 2007

Nov. 30, 2009

Resona Bank, Limited

2,000

Fixed rate

1.591%

Mar. 21, 2008

Mar. 21, 2011

Kansai Urban Banking Corporation

5,500

Fixed rate

2.000%

Jun. 30, 2008

Jun. 30, 2011

Aozora Bank, Ltd.

5,500

Floating rate

1.651%

Aug. 29, 2008

Feb. 26, 2010

Resona Bank, Limited

3,000

Fixed rate

1.902%

Aug. 29, 2008

Aug. 31, 2011

American Life Insurance Company

5,000

Fixed rate

2.290%

Sep. 2 , 2008

Aug. 31, 2013

Total long-term debt

54,270
Fixed rate

1.500%

Nov. 26, 2007

Nov. 28, 2008

#1 Unsecured Investment Corporation Bond
Total interest-bearing debt

22,00078,770* Borrowings in red represent new borrowings after the end of the fifth fiscal period.

25

■Major Investors■ Investors
Forth Fiscal Period (As of November 30, 2007)
Number of investment units by owner
Securities firms
2%Foreign bodies
27%

Individuals
21%
Government
and local
governments
0%Fifth Fiscal Period (As of May 31, 2008)
Number of investment units by owner

Breakdown of financial institutions
Nonlife insurancecompanies
2%
Life insurancecompanies
8%

Other financial
institutions
3%

Securities firms
3%

Banks
8%

Foreign bodies
25%

Government
and local
governments
0%

Other
domestic
corporations
6%

Nonlife insurancecompanies
5%

Other financial
institutions
5%

Banks
8%

Life insurancecompanies
7%

Other domestic
corporations
6%

Financial
institutions
44%

Financial
institutions
42%

Trust banks
79%■ List of top 10 investors
Forth Fiscal Period (As of November 30, 2007)
Name of investor
1
2
3
4
5
6
7
8
9
10

Individuals
24%

Breakdown of financial institutions

Trust banks
75%

Fifth Fiscal Period (As of May 31, 2008)
Number ofunits owned Ratio

Japan Trustee Services Bank, Ltd. (Trust Account)
NikkoCiti Trust and Banking Corporation (Investment Trust Account)
Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account)
The Master Trust Bank of Japan, Ltd. (Trust Account)
The Nomura Trust and Banking Co., Ltd. (Investment Trust Account)
American Life Insurance Company GALState Street Bank and Trust Company
K. K. daVinci Advisors
CB Hong Kong Cogent Global Property Securities Fund
The Hiroshima Bank, Ltd.

15,806
14,63914,50013,64911,261
7,989
7,983
6,950
3,684
3,257

7.7%
7.1%
7.1%
6.7%
5.5%
3.9%
3.9%
3.4%
1.8%
1.6%

26

Number ofunits owned

Ratio

1 The Master Trust Bank of Japan, Ltd. (Trust Account)
15,5482 NikkoCiti Trust and Banking Corporation (Investment Trust Account)
14,855
3 The Nomura Trust and Banking Co., Ltd. (Investment Trust Account)
12,646
4 Japan Trustee Services Bank, Ltd. (Trust Account)
10,417
5 Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account) 9,580
6 American Life Insurance Company GAL
7,989
7 K. K. daVinci Advisors
6,950
8 Goldman Sachs International
5,971
9 Nomura Securities Co., Ltd.
4,697
10 UBS AG London Account IPB Segregated Client Account
4,593

7.58%
7.25%
6.17%
5.08%
4.67%
3.90%
3.39%
2.91%
2.29%
2.24%

Name of investor

■Sixth Fiscal Period EPS Interest Sensitivity
Sensitivity Analysis(Unit: Yen)

Impact of dividend per unit

Rate of rent increase(six-month period)

0%
1%
2%
3%
4%
5%

0.00%
78
291
504
717
929
1,142

0.75%
-313
-100
111
324
537
750

The above impact on dividend
per unit is factored in torecalculate the forecast dividend
based on the publicly announced
amount of ¥26,475(Unit: Yen)

Forecast dividend per unit

Rate of rent increase(six-month period)

Interest rate spread (annual rate)
0.30%
0.45%
0.60%
0
-78
-156
-235
212
134
55
-22
425
347
268
190
638
560
481
403
851
773
694
616
1,064
985
907
829

0.15%

0%
1%
2%
3%
4%
5%

0.00%
26,517
26,721
26,925
27,13027,33427,538Interest rate spread (annual rate)
0.15%
0.30%
0.45%
0.60%
26,47526,432
26,39026,34826,67926,637
26,59426,552
26,883
26,841
26,79826,75627,087
27,04527,003
26,96027,291
27,24927,207
27,16427,49527,453
27,411
27,368The repricing date during thesixth fiscal period is scheduled
to be at the end of August.
Therefore, interest rate costs on
the list are converted to those forthree months.
All dividends per unit on the list
are converted on the assumptionthat the number of investment
units is 343,905.

0.75%
26,30526,51026,714
26,91827,122
27,326(Note) The above sensitivity analysis is based solely on the forecast dividend per unit and is provided for simulation purposes only.
Accordingly, there is no guarantee of the accuracy of predicted amounts.

27

A 0.15% interest rateincrease is factored in on thebasis of current short-term
variable interest rate levels

■Portfolio Performance Summary (Fifth Fiscal Period Results by Property)(*1) For operating income from property leasing activities, actual results (excluding certain other income and property-related taxes)
for the fifth fiscal period are used and displayed by rounding off to the nearest thousand yen.

(*4) NOI Yield is calculated by dividing annualized NOI in 3 on the table by the acquisition price.
(Note) As the above properties are assets under management as of the period end, they do not include daVinci Shin-Yokohama 214
and Sapporo Chiyoda Building, which were sold during the period.

(*2) Other income does not include restoration and renovation work or deferred security deposits.
(*3) Property taxes, city planning taxes and depreciable asset taxes recorded in property-related taxes are calculated by converting theactual amount for fiscal 2007 to the number of operating days in the fifth fiscal period.

28

Property Disposition Results
DA Office REIT aims to raise portfolio quality by selling mainly its small-sized office buildings or(Millions of yen)office buildings outside of the five central wards of Tokyo to bring about high gains on sales.
Period2

Property nameAppraisal value

Selling price

Capital gain*

1,688

1,719

2,180

29.1%

daVinci Shimbashi 620

660

732

790

19.7%

daVinci Koishikawa

1,460

1,460

1,500

2.7%

daVinci Okayama

1,266

1,357

1,600

26.4%

daVinci Hakata

2,520

2,280

3,090

22.6%

daVinci Nishi-Gotanda I

1,640

1,790

2,211

34.8%

daVinci Kayabacho 376

2,020

2,400

2,600

28.7%

daVinci Shin-Yokohama 131

1,350

1,520

2,165

60.4%

daVinci Yushima

1,080

1,200

1,295

19.9%

Sapporo Chiyoda Bldg.

1,384

1,624

2,005

44.9%

daVinci Shin-Yokohama

2,180

2,980

3,200

46.8%

Believe Omori

3,160

4,010

4,480

41.8%

daVinci Mita

3,250

4,690

4,760

46.5%

daVinci Kamiyacho

12,00014,90017,000

41.7%

Total

35,65842,622

48,87637.1%

daVinci Gyoenmae

3

4

5

6

Acquisition price* Capital gain: Gain on sale/acquisition price29

■Portfolio Property Photographs (1)■ Overview of Property
Shinjuku Maynds Tower

Acquired as ofJuly 13, 2007

Acquired as ofNovember 26, 2007

Acquisition Price:¥65,100 million
Co-ownership: 42.9%

Acquisition Price:¥68,700 million
Co-ownership: 42.9%

Fifth period NOI yield (Note 1)
Assumed NOI yield based onmarket report (Note 2)

3.5%
4.9%

Total Acquisition Price:Price¥133,800 million
Co-ownership:
85.7%

Market rent (Note 3)
Rent gap ratio (Note 4)¥45,000
39.2%(Note 1) Fifth period NOI yield = Fifth period NOI / acquisition price.
(Note 2) Assumed NOI Yield (before property repair expenses) is calculated based on a market report by Tokyo Livable, Inc.
(Note 3) Market rent is based on an assessment prepared in a market report by Tokyo Livable, Inc.
(Note 4) Rent gap ratio = (Market rent – Current rent) / Current rent

Appraisal
Appraisalvalue
valueatatthe
thetimetimeofofacquisitionacquisition(July,
2007)(July, 2007)¥130,200¥130,200million
millionLocation: 2-1-1 Yoyogi, Shibuya-ku, Tokyo
Land area: 11,500.48 m2
Structure: S, SRC
Number of floors: 3 below ground, 34 above ground
Floor area: 97,978.74 m2
Leasable floor area: 51,911.14 m2
Construction completion: September 26, 1995
Occupancy rate: 99.4% (as of May 31, 2008)(Note) DA Office REIT acquired trust beneficiary rights in real estate forco-ownership corresponding to a ratio of 6:7 of the entire building. The above figuresfor land area, floor area and leasable floor space refer to the entire property.

30

Current
Currentappraisal
appraisalvalue
value
(End
of
(End ofMay,
May,2008)
2008)¥138,000¥138,000million
million■Portfolio Property Photographs (2)■ Overview of Properties

daVinci Onarimon

daVinci Ginza¥30,000
Rent gap ratio
26.9%
Projected fourth period
6.4%
NOI yield¥35,000
Rent gap ratio
22.2%
Projected fourth period
5.8%
NOI yield

Market rent (Note 1)

Market rent (Note 1)(Note 2)

(Note 2)

(Note 1) Market rent is based on an assessment prepared in a market
report by Tokyo Livable, Inc. (November 30, 2007).

(Note 1) Market rent is based on an assessment prepared in a market
report by Tokyo Livable, Inc. (November 30, 2007).

(Note 2) Rent gap ratio = (Market rent – Current rent) / Current rent

(Note 2) Rent gap ratio = (Market rent – Current rent) / Current rent

Appraisal
Appraisalvalue
valueatatthe
the
time
of
acquisition
time of acquisition(December(December2006)
2006)¥13,860¥13,860million
millionCurrent
Currentappraisal
appraisalvalue
value
(End
(EndofofMay,
May,2008)
2008)¥18,600¥18,600million
millionAppraisal
Appraisalvalue
valueatatthe
the
time
of
acquisition
time of acquisition(October(October2005)
2005)¥14,100¥14,100million
millionCurrent
Currentappraisal
appraisalvalue
value
(End
(EndofofMay,
May,2008)
2008)
19,00019,000million
millionLocation: 6-1-11 Sinbashi, Minato-ku, Tokyo

Location: 6-2-1 Ginza, Chuo-ku, Tokyo

Land area: 1,990.40 m

Land area: 1,147.33 m2

Structure: SRC

Structure: SRC

Number of floors:9F

Number of floors: B3/9F

Floor area: 13,805.18 m2

Floor area: 12,660.06m2

Leasable floor area: 11,883.66 m2

Leasable floor area: 8,272.94m2

Construction completion: April, 1973

Construction completion: July,1963

Acquisition price: ¥13.86 billion

Acquisition price: ¥14.1 billion

Occupancy rate: 100% (As of May 31, 2008)

Occupancy rate: 99.5% (As of May 31, 2008)231

■Portfolio Property Photographs (3)(As of September 8, 2008)

daVinci Nihonbashi
HonchodaVinci Kyobashi

daVinci Ginza 1-chome

Sunline 7 Bldg.

daVinci Ginza Annex

daVinci Kodemmacho

daVinci Shibaura

daVinci Minami Aoyama

daVinci Sarugakucho

daVinci A Hamamatsucho

daVinci Jingumae

daVinci Shibadaimon

daVinci MisakichodaVinci Shimbashi 510

32

■Portfolio Property Photographs (4)(As of September 8, 2008)

BPS Square

daVinci Tsukiji

daVinci Tsukiji 616

Shuwa Tsukishima Bldg.

Nihonbashi MS Bldg.

Atlantic Bldg.

daVinci KinshichodaVinci HigashiIkebukuro

SHIBUYA EDGE

daVinci Shinagawa II

daVinci Minami-Senba

Bennex S-3

33

Shibuya SS Bldg.

■Map of Portfolio(As of September 8, 2008)

Main Target Area for Investment: Five Central Wards of Tokyo

Possible Areas for Investment:
Major Regional Cities

Shinjuku Ward
Shinjuku Station
Shinjuku
Maynds
Tower

ShibuyaWarddaVinci Sarugakucho

daVinci MisakichodaVinci Nihonbashi Honcho

Nihonbashi MS Bldg.

Chiyoda Ward
Sunline 7 Bldg.
Tokyo
daVinci Ginza 1-chome
BPS Square Station

daVinci Kodemmacho

Chuo WarddaVinci Minami-Senba

daVinci Tsukiji
daVinci Jingumae

daVinci Kyobashi
daVinci
Ginza Annex
daVinci Tsukiji 616
daVinci Minami Aoyama
daVinci
SHIBUYA EDGE
daVinci Ginza
Shimbashi
Shuwa
510
Shibuya Station
TsukishimadaVinci Onarimon
Bldg.
daVinci A Hamamatsucho
Shibuya SS Bldg. Atlantic Bldg.
daVinci
Shibadaimon

Target Area for Investment:
Tokyo Metropolitan Area
daVinci Higashi-Ikebukuro

daVinci Kinshicho

Minato WarddaVinci Shibaura
Bennex S-3
Yamanote LineTokyo

Saikyo Line

Shinagawa Station
daVinci Shinagawa II

Chuo Line
YokosukaLine/Sobu
Express Line34

■Organization of the Asset Management Company
Board of Directors and Auditors■ Organization Chart

Representative Director Yoshiki Nishigaki (President and Representative Director)

Shareholders’ Meeting
Auditors
Board of Directors

Director

Takashi Abe (Chairman)

Director

Jinmoo Kim (Manager of General Administrative
Department and IR & Planning Department)

Director

Kazuhiro Tadano (Chief Financial Officer)

Director

Kotaro Matsuoka (Chief Investment Officer)

Outside Director

Masayoshi Ogawa (Tax Accountant)

Outside Director

Shigeru Takagi (Attorney of Law)

AuditorKoichi Yokoyama (CPA)

Compliance Committee
Investment Committee■ Company Overview

Compliance Officer
Representative Director
Internal Control Office

Company Name: daVinci Select Kabushiki Gaisha
Address: 6-2-1 Ginza, Chuo-ku, Tokyo

Investment Management
Department

General Administrative
Department

IR & Planning
Department

Finance Department

Established: October 21, 2004

Research &Acquisitions Team

Personnel & General
Affairs TeamIR & Planning Team

Finance & Accounting
Team

Capitalization: 200 million yen- Matters relating to the acquisitionand disposal of assets- Research and analysis of industry
trends in the real estate market andthe retail industry- Development and revision of theInvestment Guidelines- Matters relating to theoperation of the general
meeting of investors and theboard of directors and mattersrelating to the operation of thegeneral meeting ofshareholders, the Board of
Directors and committees- Matters relating to disclosures- Matters relating to financingof the investment
corporation

Directors: 8 (4 executive, 3 non-executive, 1 auditor)- Development and revision of
the Investment Guidelines

Employees: 23 (Including 3 concurrent directors, as of July24, 2008)

Asset Management
Team- Development of asset management
plans, annual asset management
plans and medium-term asset
management plans and thedevelopment and revision of
medium-term asset managementplans- Development and revision of theInvestment Guidelines- Compliance officer support,
etc.
- Matters relating to humanresources and general affairs- Matters relating to IR of theinvestment corporation- Research and analysis of the realestate investment trust market- Matters relating to thedevelopment of a budget,
settlement of accounts,
disclosure and accounting of
the investment corporation- Matters relating to the response
to investors of the investment
corporation (excluding mattersrelating to general meetings ofinvestors)

Representative Director: Yoshiki Nishigaki

Registered Financial Instruments Firm No. 355 (Financial
Instruments), Director, Kanto Local Finance Bureau
Building Lots and Buildings Transaction Business License
No. (1)-83920, Governor of Tokyo
Discretionary Agent for Real Estate Transaction Approval
No. 34, Minister of Land, Infrastructure and Transport
A member of the Investment Trusts Association of Japan

35