Forty-Third Fiscal Period Semi-Annual Report
January 1, 2023 – June 30, 2023

Japan Prime Realty Investment Corporation

Japan Prime Realty Investment Corporation

We at Japan Prime Realty Investment Corporation (JPR) would like to express our sincere
gratitude for the continued loyal patronage you have extended to us.
Having settled the 43rd fiscal period (January 1, 2023 – June 30, 2023), we would like to reporton the performance results.
Although the impact of the unstable international situation and price hike, etc. continues tobe seen at present, the vacancy rate in central Tokyo remains generally flat partly due to thenormalization of socio-economic activities and the recovery of demand in the office property
leasing market.
Under such circumstances, JPR continues to conduct stable operation with an averageoccupancy rate for the 43rd fiscal period of 97.6% (+0.3% compared with the forecast), anddistribution per unit was 7,600 yen, the same amount as the initial forecast. In the next fiscal
period onwards, JPR plans to secure a certain level of distribution by further improving
operations and utilizing gain on sale from strategic asset replacements and abundant internal
reserves.
Going forward, while continuously paying close attention to the trend of office market andfinancial environment, we will flexibly respond to changes in the business environment andendeavor achieving appropriate asset management to grasp new opportunities for growth.
We ask you, our unitholders, to extend us continued support of our operations.

Portfolio Management StatusItem42nd Period 43rd Period
Changeended
ended
Dec. 2022
Jun. 2023
Rate of
ChangeResults
ResultschangeOperating revenue

18,73918,173

-566

-3.0%

Operating income

9,273

8,859

-413

-4.5%

Ordinary income

8,469

8,099

-370

-4.4%

Net income

8,469

8,098

-370

-4.4%

(million yen)(million yen)(million yen)(million yen)

Distribution per unit
(yen)

7,750

7,600

-150

1

-1.9%

Operating revenue includes gain on sale of properties.
(42nd fiscal period: 1,347 million yen, 43rd fiscal
period: 881 million yen)

Operating income decreased due to the decline intemporary revenues such as gain on sale of properties
and income from cancellation penalty.

Distribution per unit came to 7,600 yen (down 150
yen from the previous fiscal period), the same amountas the initial forecast.

Japan Prime Realty Investment Corporation

43rd Fiscal Period Topics
Implementation of Strategic Asset Replacement
In an attempt to further improve the quality of its portfolio, JPR conducted asset replacement from
December 2022 to April 2023.
Asset replacement
Asset sold

Newly acquired assets 15.5 billion yen

Assetreplacement

Shinjuku Center Bldg.
(Additional ownership)
December 2022

Osaka Dojima Bldg.
January 2023

FUNDES Tenjin Nishidori
January 2023

Gotanda First Bldg.
December 2022

Ochanomizu Sola City
April 2023

JPR Crest Takebashi Bldg.
April 2023

[Effect of asset replacement]►

Asset size

+8.66 billion yen►

NOI (Note 1)

Building age (Note 2)►+244 million yen/year-10.0 years(Note 1) “NOI” refers to the net operating income stated in the real estate appraisal report.
(Note 2) The figure is obtained by deducting the weighted average building age based on the acquisition price of the properties sold from the weighted average building age basedon the acquisition price of the properties acquired.

► Ochanomizu Sola City (asset acquired in the 43rd fiscal period)
It is a landmark building in the “Ochanomizu” area situated in an excellent location which is directly connected toShin-Ochanomizu Station on the Tokyo Metro Chiyoda Line and a one-minute walk from “Ochanomizu” Stationon the JR Chuo-Sobu Line.

Acquisition date

Appraisal value

7,170 million yen

3.3%



Occupancy rate2

February 2013



Yield after depreciation

Seller6,490 million yenCompletion date
NOI yield

April 12, 2023

Acquisition price





2.7%
99.0%
Yasuda Real EstateJapan Prime Realty Investment Corporation► Osaka Dojima Bldg.

► FUNDES Tenjin Nishidori(asset acquired in the 43rd fiscal period)

Acquisition date
Acquisition priceAppraisal value
Completion date
NOI yield
Yield after depreciation
Occupancy rate
Seller(asset acquired in the 43rd fiscal period)

Acquisition date

January 11, 2023

Acquisition price

2,460 million yen

Appraisal value

2,700 million yen

Completion dateJuly 1996

NOI yield

4.9%

Yield after depreciation

4.3%

Occupancy rate

100.0%

SellerTokyo Tatemono

January 11, 2023
3,310 million yen
3,590 million yen
March 2022
3.8%
3.3%
100.0%
Tokyo Tatemono

Strengthening of Tokyo Tatemono’s Sponsorship
TRIM, the asset management company of JPR, became a wholly owned subsidiary of Tokyo Tatemono
on April 26, 2023. JPR intends to further enhance unitholder value by further strengthening cooperation
with Tokyo Tatemono, which became the sole sponsor.
► Management structure after the structural change of sponsor
Sole sponsor

Investment ratio 100%

Asset manager

Asset management agreement

REIT

3

Japan Prime Realty Investment Corporation

Initiatives on Sustainability
Materialities
JPR and TRIM, the asset management company, are promoting initiatives on sustainability by setting items on risks
and opportunities of materialities and contribution to SDGs.
Materialities

PolicyAction on climate change

Improving tenantsatisfaction with safety,
security and comfort

Creating a rewarding
workplace environment

Strengthening corporate
governance

SDGs· Promote the acquisition of environmental certifications· Reduce GHG emissions· Efficient use of water resources· Strengthen management of climate change risks· Work with tenants to address climate change· Improve satisfaction by providing tangible and intangible services to ensure
safety, security and comfort· Strengthen human resources through training and self-development support· Build a highly efficient operational structure· Maintain and improve physical and mental health· Create a rewarding workplace environment· Promote diversity and inclusion· Implement transparent management through active IR· Improve the comprehensive strength of the sustainability promotion system· Respect for human rights· Ensure a strong corporate governance system· Reinforce the risk management structure

Recognition by External Bodies/Initiatives
GRESB Real Estate Assessment

CDP Climate Change Program

Four
consecutive
years

MSCI ESG Rating (Note)A-

5 Stars
MSCI Japan ESG Select Leaders Index (Note)

PRI (Principles for Responsible Investment)

United Nations Global Compact
Participated as
Tokyo TatemonoGroup

Included in the index for threeconsecutive years(Since May 2021)(Note) JPR’s use of data produced by MSCI ESG Research LLC or its affiliates (“MSCI”) and JPR’s use of MSCI logos, trademarks, service marks or index names do not constitute a sponsorship,guarantee, recommendation, or promotion of JPR by MSCI. MSCI’s services and data are the property of MSCI or the entity providing such information and are provided “AS IS”
without warranty of any kind. MSCI’s names and logos are trademarks or service marks of MSCI.

4

Japan Prime Realty Investment Corporation

環境への取組み
Initiatives
on Environmental Friendliness

環境への取組み■
イニシアティブ）による認定を取得
SBTi（ Science
Based fromTargets
Certification
Science
Based Targets
Initiative (SBTi)■ Acquired（
イニシアティブ）による認定を取得
SBTi
Science
Based
Targets
JPR は気候変動が事業に大きな影響を与えるものと認識し、ネットゼロに向けた GHG（温室効果ガス）排出量削減目標を■

JPR recognizes
that climatechange has a significant impactネットゼロに向けた
on itsbusiness,andhasset認定を取得しました。
greenhousegas (GHG)（温室効果ガス）
排出量削減目標を
JPR は気候変動が事業に大きな影響を与えるものと認識し、GHG
では3 社目に設定しています。
この度、SBTiによるネットゼロ基準認定企業として、
J-REIT
SBT
emission
reduction targets
toachieve
net zero. This time, JPR became
third
J-REIT
to acquire the SBTによるネットゼロ基準認定企業として、では3社目に設定しています。
この度、
SBTi
J-REITthe
SBT認定を取得しました。

certification as a company with net zero standard certified by SBTi.
SBT i は、気候変動による世界の平均気温上昇を 1.5 ℃に抑えるとSBT i は、気候変動による世界の平均気温上昇を
1.5 ℃に抑えるという目標に向け、企業に対し科学的根拠に基づく排出量削減目標
SBTi supports the setting of emission reduction
targets based on scientiﬁc grounds andいう目標に向け、企業に対し科学的根拠に基づく排出量削減目標の設定支援や認定を行っています。
certiﬁes them for companies
to achieve the target of limiting the rise in global averageの設定支援や認定を行っています。
及びTRIM
は2030年までにScope3を含めたGHG総排
JPRchange
temperature caused byなお、
climateto 1.5℃.
なお、JPR及びTRIMは2030年までにScope3を含めたGHG総排出量46.2%削減（2019年比）という、より対象範囲を拡大した目標
Furthermore, JPR and TRIM
set削減
a targetwithanという、
expandedscope of reducing total
（2019
年比）
より対象範囲を拡大した目標
出量have46.2%を設定しています。
を設定しています。
GHG emissions including
Scope 3 by 46.2% (compared to 2019) by 2030.

▶ 認定された目標
Certifiedtargets►認定された目標▶

▶

排出量の実績
GHG▶
排出量の実績
Resultsof GHG emissions►GHG

年
Target目標年
year 2030年2030
2030

年
2050年
2050
2050

80,00080,000

2019年
2019年2019

2019
年
2019
2019年

60,00060,000

目標年

基準年
Base year
基準年-（t-CO2（）t-CO2）−−
17.9%%
17.9
削減
削減
Reduction

40,000Targeted
GHG
Scope1+2
Scope1+2+3
対象の 対象のScope1＋2Scope1
Scope1＋2＋＋
3 2＋3
GHGScope1＋2
GHG
Emission46%
Net zero
排出量
reduction
target
ネットゼロ
46%
排出量
削減目標 46%
ネットゼロ(Note) Certified reduction ratios are rounded off.

40,00020,00020,000削減目標

00（注）認定された削減比率は四捨五入して掲載しています。

2019
2019年
（基準年）
年 year)
2019
(base

（基準年）

（注）認定された削減比率は四捨五入して掲載しています。

2020
2020年
2020年

2021
2021年
2021年

2022
2022年
2022年

of Acquisition of Environmental Certifications■ Status環境認証の取得状況■■

環境認証の取得状況
2030 年目標「環境認証取得（ 4 スター又は A ランク以上）カバー率 80% 以上」を目指し、当期は CASBEE 不動産評価の新規

With an aim to achieve the 2030 target of “certification acquisition rate of 80% or more (4-star/“A” rating or
年目標「環境認証取得（ 4 スター又はカバー率 80% 以上」を目指し、当期は不動産評価の新規
2030
A ランク以上）
CASBEE
継続取得した
認証を4 物件で取得したほか、1 物件でランクアップしました。
4 スター又はA ランク以上の認証取
higher)”,JPR
acquired newcertificationsof CASBEE
for Real Estate for その結果、
four properties
as well
as a higher rankとなり、着実にポートフォリオのグリーン化を進めています。
得率は
73.1%
認証を 4 物件で取得したほか、継続取得した 1 物件でランクアップしました。その結果、4 スター又は A ランク以上の認証取
for one property whose certification was continuously acquired in the 43rd fiscal period. As a result, the acquisition
得率は73.1% となり、着実にポートフォリオのグリーン化を進めています。
rate of certifications with 4-star/“A” rating or higher was 73.1%, and JPR is steadily proceeding with the greeningof its portfolio.
S ★★★★★ ＋2物件
＋2物件
S ★★★★★
＋3物件
A ★★★★

+2＋properties
3物件

★★★★
AS ★★★★★

+3 properties

A ★★★★
（%）

（%）

80

2030年目標 80%

80

70.5%

60

59.6%
60

40

20

0

9

9

45.9%

40

27.3% 28.3%

20

0

13.4%

27.3% 28.3%

2018.122019.6

34.0%

34.0%
2019.12

40.2%

40.2%
2020.645.9%

2020.122021.6

49.3%

70.5%

Targetfor年目標2030 80%
2030
80%
73.1%

73.1%

59.6%

49.3%

2021.122022.62022.122023.6（期）

2030年

（期）
2023.6Jun.
2023(Period)

2030年
2030

13.4%
2018.12Dec.
20182019.6Jun.
20192019.12Dec.
20192020.6Jun.
2020

2020.12Dec.
2020

2021.6Jun.
2021

5&&BBBRVWᮾி㺶㺏㺷㺡㺆㺃㺐㺻㺫㺼㺛㺢㺰㺻㺢㺃㺭㺦㺚㺼㺰㺻㺢B㈨⏘㐠⏝ሗ࿌ ➨ᮇ LQGG

2021.12
Dec. 2021

2022.6Jun.
2022

2022.12
Dec. 2022

Japan Prime Realty Investment Corporation

Initiatives on Behalf of the Society■ Periodic Tenant Satisfaction (CS) Survey
Good relationships with tenants, which are major stakeholders, are extremely important in maintaining highoccupancy rates and achieving revenue stability. JPR has been conducting tenant satisfaction surveys from anearly stage to share issues with building managers and improve them. As a result, total satisfaction in 2023 reacheda record high since the start of the survey.
In addition, JPR has expanded the scope of survey through efforts such as adding new questions on ESG, and is
working to further improve satisfaction.
(cases)75
60

Number of buildings surveyed (left axis)
3.16

3.24

3.27

3.29

3.33

3.35

3.39

3.43

3.48

3.49

3.50

3.51

3.39

3.44

3.47

3.52

3.54

31

32

31

32

32

36

37

38

37

41

40

39

40

45

42

40

40

39

2.0
1.0

15
0

4.0
3.0

45
30

3.29

Overall satisfaction (right axis)

2005

2006

2007

2008

Overview of 2023 Tenant
Satisfaction Survey

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2021

2022

2023

0

[Total satisfaction]
Average value with four points as full score[Survey date]
May through June 2023
[Buildings surveyed] 40 buildings with 470 tenants[Questions] 	Administration and operations, tenant responsiveness, crime prevention and security, emergency
responses, environmental preservation, etc.
(Note) In 2020, the survey was not conducted due to the spread of COVID-19 pandemic.

Initiatives on GovernanceIn the belief that it is essential to secure sound and efficient
operations of JPR in order to realize its continuous growth,
consistent efforts have been made to reinforce and sustain
corporate governance of JPR and TRIM, the Asset Manager.

■ Decision-Making Based on Stringent Processes· A
 t TRIM, decisions on matters such as property acquisitions andoperations are made based on stringent examination from a wide
perspective at meetings of the various committees.
· In particular, with regard to material transactions conducted with thesponsors, etc., their adequacy and rationality are screened and verified by
the Compliance Committee and the unanimous approval of all members
is required, in principle.
· An outside attorney has been appointed as a special member of theCompliance Committee.

Decision-Making Process (for property acquisitions)
Proposal, planning

Responsible Department

Review, screening

Compliance Subcommittee

Confirmation of results ofdue diligence/verificationof solutions andimprovement measures

Due Diligence Subcommittee

Transactions otherthan transactions withrelated parties

Deliberation Compliance Committee
Approval JPRʼs Board of Directors

Deliberation(decision on acquisition)
ReportingConclude agreement■ Invited an External Special Member to theInvestment Committee

Transactions withrelated parties

Investment Committee
TRIMʼs Board of Directors
Property acquisition(Note 1) In addition to the processes indicated in the above chart, there may be

We invited a special member qualified as a real estateappraiser from outside the company to strengthen thegovernance system.

cases where approval by the Board of Directors and consent by JPR are
required as designated in the Act on Investment Trusts and Investment
Corporations.
(Note 2) The chart shows a general decision-making mechanism, and dependingon the nature of the proposed acquisition, the order of the procedure
may be partially changed or some meetings, etc. may not be held.

6

Asset Management ReportJapan Prime Realty Investment Corporation

1.1.Overview
AssetManagement
Management
Overview ofof Asset(1)
andOther
OtherManagement
Management
Data(1)Trends
TrendsininOperating
Operating Results
Results and
Data

2.

Reference
Information

Financial Indices

Cash Distribution per
Unit, etc.

Financial Position

Operating Performance

Fiscal Period

Unit

39th Fiscal
Period(Jan. 1, 2021 Jun. 30, 2021)
17,30540th Fiscal
Period(Jul. 1, 2021 Dec. 31, 2021)
18,253

41st Fiscal
Period(Jan. 1, 2022 Jun. 30, 2022)
18,35742nd Fiscal
Period(Jul. 1, 2022 Dec. 31, 2022)
18,73943rd Fiscal
Period(Jan. 1, 2023 Jun. 30, 2023)
18,173Operating Revenue
Rent revenue – real estate

Million yen

Gain on sale of real estate

Million yen

16,521
783

16,382
1,870

17,0191,338

17,392
1,347

17,291
881

Million yen

8,515

9,626

9,014

9,466

9,314

Million yen

7,499

7,731

7,946

8,199

8,310

Million yen

8,789

8,626

9,343

9,273

8,859

Million yen
Million yen

8,121
8,120

7,893
7,892

8,607
8,607

8,469
8,469

8,099
8,098

Million yen

484,323495,615

507,005

507,655

510,069(-0.1)(+2.3)(+2.3)(+0.1)(+0.5)

Million yen

196,500

206,900

202,900

202,900

205,400

Million yen%

257,093(+0.3)

257,649(+0.2)

272,912(+5.9)

273,603(+0.3)

273,974(+0.1)

Million yen

247,860

247,860

261,751

261,751

261,751

Million yen

7,337

7,234

7,777

7,728

7,578

%

90.3

91.6

90.3

91.2

93.5

Units
Yen

958,250
268,295

958,250
268,875

997,178
273,684

997,178
274,378

997,178
274,749

Yen

7,657

7,550

7,800

7,750

7,600

Yen

7,657

7,550

7,800

7,750

7,600

Yen

–

–

–

–

–

%
%

1.7
3.4

1.6
3.2

1.7
3.5

1.7
3.3

1.6
3.2

%

3.2

3.1

3.2

3.1

3.0

%

6.4

6.1

6.5

6.1

6.0

256,399

257,093257,649

272,912273,603

%

53.1

52.0

53.8

53.9

53.7

pt

(+0.2)(-1.1)(+1.8)(+0.1)(-0.2)

%

40.6

41.7

40.0

40.0

40.3

Times

14.6

13.8

14.1

13.8

13.8

Million yen

10,132

9,708

10,026

10,1209,984Million yen

694
11,121

701
10,779710
11,118731
11,248722
11,025

%

4.8

4.3

4.5

4.5

4.4

Million yen

9,751

9,177

9,737

9,745

9,571

%

4.2

3.7

4.0

3.9

3.9

65
804

66
1,134

67
1,171

65
1,180

67
1,224

m2

496,876.92

500,628.05

502,889.81

494,503.72

497,600.56

%

98.1

97.3

97.5

97.6

98.1

Operating Expenses
Expenses related to rent business
Operating Income
Ordinary Income
Net Income
Total Assets(Period-on-period variation)
Interest-bearing Debts
Total Unitholders’ Equity(Period-on-period variation)
Unitholders' Capital
Total Cash Distributions
Dividend payout ratio
Number of Units Outstanding
Total Unitholders' Equity per Unit
Cash Distribution per Unit
Distribution amountExceeding profit distribution amount
Ordinary Income on Total Assets (Note 1)
Annualized (Note 10)
Net Income on Total Unitholders'Equity (Note 2)
Annualized (Note 10)
Total unitholders' equity at
beginning of period
Unitholders' Equity Ratio at End of
Period (Note 3)(Period-on-period variation)
Interest-bearing Debts to Total Assets at
End of Period (Note 4)
DSCR (Note 5)
Net income before interest andamortization (Note 6)
Interest expenses
NOI from Leasing (Note 7)
Annualized NOI yield(Notes 9 and 10)
NCF from Leasing (Note 8)
Annualized NCF yield(Notes 9 and 10)
Investment Properties Owned (Note 11)
Number of Tenants
Total Leasable Floor Space (Note 12)
Occupancy Rate

Million yen%

Million yen

Million yen(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)

Ordinary income / (total assets at beginning of period + total assets at end of period) / 2
Net income / (total unitholders' equity at beginning of period + total unitholders' equity at end of period) / 2
Total unitholders' equity at end of period / total assets at end of period x 100
Interest-bearing debts at end of period / total assets at end of period x 100
Net income before interest and amortization / interest expenses (including interest expenses on investment corporation bonds)
Income before income taxes - gain on sale of real estate + loss on sale of real estate + loss on exchange of real estate + extraordinary loss + interest expenses(including interest expenses on investment corporation bonds) + depreciation(Note 7) (Real estate rental revenues - real estate rental expenses) + depreciation(Note 8) NOI from leasing - capital expenditures

71

Asset Management ReportJapan Prime Realty Investment Corporation(Note 9) Annualized NOI from leasing / property acquisition price (39th fiscal period: ¥467.52 billion, 40th fiscal period: ¥494.23 billion, 41st fiscal period: ¥496.18 billion,
42nd fiscal period: ¥495.60 billion and 43rd fiscal period: ¥501.04 billion)
Annualized NCF from leasing / property acquisition price(Note 10) Annualization is based on 365 days for a year and calculated by using the following management days: 39th fiscal period: 181 days, 40th fiscal period: 184 days,
41st fiscal period: 181 days, 42nd fiscal period: 184 days and 43rd fiscal period: 181 days
(Note 11) Properties acquired at multiple times are calculated as one property.
(Note 12) Total leasable floor space in this table indicates the contracted area.
(Note 13) Any ratio indicated on financial indices is rounded to the first decimal place (except for the dividend payout ratio, which is rounded down to the first decimal place).

43rdFiscal
FiscalPeriod
PeriodAsset
Asset Management
Management(2)(2)43rd

3.

1) Milestones of JPR
Japan Prime Realty Investment Corporation (JPR) was established on September 14, 2001 under the Act on Investment Trusts andInvestment Corporations (hereafter, the Investment Trusts Act), and was listed on the Tokyo Stock Exchange Real Estate Investment
Trust Section (securities code: 8955) on June 14, 2002 with 289,600 outstanding investment units. With the subsequently
implemented public offerings and other capital raising measures by JPR, the number of investment units issued and outstanding
totals 997,178 units as of the end of the 43rd fiscal period (June 30, 2023). JPR has assigned the asset management of its portfolio
to Tokyo Realty Investment Management, Inc. (hereafter, the Asset Manager), through which JPR aims to maximize unitholder
value by efficiently managing the portfolio primarily comprising office properties and retail properties.
2) Management Environment
During the 43rd fiscal period, the Japanese economy remained strong as further progress was made in relaxing activity restrictions
against COVID 19. On the demand side, consumer spending stayed on a solid note despite rising general prices, and capital
investment also showed strong growth. In terms of supply, the impact of supply chain disruptions originating in China has lessened,
and production activities have started to show a recovery movement. Moreover, corporate earnings demonstrated recovery both inmanufacturing industries and the non-manufacturing sector. However, real wages, which are nominal wages minus the effect ofprices, are kept at a low level, raising concerns about the impact on consumption.
The Office Property Leasing Market
In the office property leasing market, although vacancy rates rose slightly in some areas due to an increase in the supply of properties,
among other reasons, the vacancy rate in Central Tokyo continued to level off as progress was made in the normalization of socioeconomic activities. The decrease in average rent has also been decelerating. Similar trends are observed in Greater Tokyo andother cities.
The Retail Property Leasing Market
At urban retail properties which JPR targets for investment, sales are on a recovery trend with an increase in the number ofcustomers visiting stores, given the progress made in relaxing activity restrictions against COVID-19. However, there is a growing
gap in performance among retail business categories due to rising costs, which are caused by rising general prices, and labor
shortages.
The For-Sale Real Estate Market
Active real estate transactions continue to take place in Japan against the backdrop of interest rates remaining low, despite theuptick trend in interest rates globally, and weaker yen, among other factors. Close attention must continuously be paid, however,on how interest rate trends and the foreign exchange market may affect the market conditions going forward. For office properties
that are major targets of JPR for investment, blue chip properties are in short supply while investors both in and outside Japan stillshow a strong appetite to acquire them. Thus, with low yield transactions continuing to prevail, the acquisition environment remains
harsh. Accordingly, investors continue to look for ways to effectively acquire properties, such as by diversifying the target assets
for investment and conducting asset replacement.
As for urban retail properties and hotels for which investors have shown a cautious attitude due to the impact of COVID-19,
transactions are visibly taking place.
3) Portfolio Management Status
Acquisition of New Properties and Asset Replacement
JPR investigates possible investments mainly in office properties in the Tokyo area, plus office properties in regional cities andretail properties, etc., with the primary aim of improving the quality of the portfolio and achieving stable growth of earnings while
giving attention to balancing the diversification of the portfolio, both in terms of location and asset type.
During the 43rd fiscal period, JPR acquired Osaka Dojima Bldg. (acquisition price: 2,460 million yen) and FUNDES Tenjin
Nishidori (acquisition price: 3,310 million yen) in January 2023. Subsequently, in April, JPR sold JPR Crest Takebashi Bldg. (saleprice: 4,169 million yen) and acquired Ochanomizu Sola City (3.4% co-ownership interest, acquisition price: 6,490 million yen).
As a result of these transactions, the balance of JPR’s assets under management totaled 67 properties, or 497.0 billion yen on an
acquisition price basis as of the end of June 2023, with the total leasable floor space standing at 497,600 m2 and the number oftenants at 1,224.

28

Asset Management ReportJapan Prime Realty Investment Corporation

Operational Management of Portfolio
In the office property leasing market in the 43rd fiscal period, the upward trend in the vacancy rate and the downward trend in rent
levels appeared to take a temporary pause, given further progress made in relaxing activity restrictions against COVID-19, etc., asmentioned in the Management Environment above. Nevertheless, the situation demands that close attention be continuously paid.
Under such circumstances, JPR endeavored to attract new tenants through strategic leasing activities and enhance the satisfactionof existing tenants by maintaining close cooperation with property management companies and brokers, with an aim to securestable earnings across the entire portfolio as well as its occupancy rate. As a result of these efforts, the occupancy rate at the end of
the 43rd fiscal period was kept at a high level, as it rose 0.5 points period-on-period to 98.1%.
In terms of property management, JPR continued to proactively implement value enhancement works based on tenant needs, on
the ground of its brand concept A/3S (Amenity/Service, Safety and Save Energy) that has been established with an aim to create
spaces where the workers feel satisfaction.
On top of this, JPR is engaged in a variety of environmental initiatives. In terms of construction work, JPR conducted replacementof lighting equipment with LED lamps, replacement of power-receiving and transforming facilities and renewal of elevators, etc.,
which are expected to be effective for CO2 emissions-reduction efforts, at its multiple properties.
JPR also continues its endeavors to obtain environmental certifications. As of June 30, 2023, JPR has acquired DBJ Green Building
Certification*1 for 13 properties in total. JPR has also obtained CASBEE for Building Certification*2 for 41 properties in total(including 5 newly certified properties), and BELS*3 certification for 3 properties (including one property certified as ZEB Oriented(a ZEB*4 certification type designated as ZEB Oriented*5)). On top of these certifications JPR acquired, its endeavors on
environmental issues were so acknowledged that it was designated as “Green Star” in the GRESB *6 Real Estate Assessment for
2022, marking the ninth consecutive year of recognition with the highest ranking in the survey. JPR has also been granted thehighest rank of “5 Stars” in the rating, which makes relative assessment based on total scores, for four consecutive years.
*1 The DBJ Green Building Certification is a certification system to select superior real estate that meets the demand of the times by scoring buildings based on thescoring model originally developed by Development Bank of Japan Inc. Its purpose is to promote properties that are environmentally friendly, equipped to mitigate
disasters and prevent crime, as well as meet the social requirements surrounding real estate from various stakeholders (“Green Buildings”).
*2 CASBEE, which stands for Comprehensive Assessment System for Built Environment Efficiency, is a system for comprehensively assessing the environmental
performance of buildings. Efforts to develop and popularize the system in Japan are being carried out under the leadership of the Ministry of Land, Infrastructure,
Transport and Tourism.
*3 BELS is an abbreviation for Building-Housing Energy-efficiency Labeling System. It is a performance labeling system created for the purpose that a third-party
organization accurately conducts the evaluation and indication of energy efficiency performance of non-residential buildings in accordance with the Assessment
Guidelines on Energy Efficiency Performance of Non-residential Buildings (2013) established by the Ministry of Land, Infrastructure, Transport and Tourism.
*4 ZEB is an abbreviation of Net Zero Energy Building, and refers to buildings that aim to balance out the annual primary energy they consume to zero, while realizing
a comfortable indoor environment.
*5 ZEB Oriented refers to special use buildings with a total floor space of 10,000 m 2 or more that have adopted measures to achieve energy conservation and reduced
primary energy consumption by at least 40% from the standards set in the Act on the Improvement of Energy Consumption Performance of Buildings.
*6 GRESB is an annual benchmarking assessment to measure ESG (Environmental, Social and Governance) awareness of real estate companies and funds, as well as
the name of the organization which runs the assessment system. It was founded in 2009 primarily by major European pension fund groups. Of the survey subjects,
GRESB Real Estate Assessment covers real estate companies and funds that are mainly engaged in managing existing properties.

Fund Procurement
JPR focuses its endeavors on debt financing with an emphasis placed on lengthening debt maturity and diversifying repayment
dates, in an effort to make its financial base more solid and stronger. JPR borrowed 7.0 billion yen in the 43rd fiscal period to fundthe refinancing of interest-bearing debts (excluding short-term debts) it repaid during the same fiscal period.
As of the end of the 43rd fiscal period, the balance of interest-bearing debts totaled 205.4 billion yen, with a balance of borrowingsof 169.5 billion yen and a balance of investment corporation bonds of 35.9 billion yen. The ratio of interest-bearing debt to total
assets (LTV) (Note 1) was 40.3%, long-term and fixed interest-bearing debt ratio (Note 2) was 97.3%, average debt cost (Note 3)
was 0.76% and average maturity (Note 4) was 4.4 years as of the end of the fiscal period.
Moreover, JPR established a commitment line with a credit limit of 24 billion yen with six financial institutions.
The following represents the issuer ratings for JPR as of the end of the 43rd fiscal period.
Details of Corporate Credit Ratings as of June 30, 2023
Credit Rating Agency
Japan Credit Rating Agency, Ltd. (JCR)

Corporate Credit Rating (Outlook)
AA (Stable)

Rating and Investment Information, Inc. (R&I)

AA- (Stable)(Note 1) Ratio of interest-bearing debts to total assets (LTV): (balance of borrowings + balance of investment corporation bonds)/ total assets(Note 2) Long-term and fixed interest-bearing debt ratio: long-term, fixed interest-bearing debts / total interest-bearing debts(Note 3) Average debt cost: sum total of interest expenses, interest expenses on investment corporation bonds, borrowing expenses (excluding expenses for early
repayment of borrowings and for commitment line agreements), amortization of investment corporation bond issuance costs and investment corporation bondmanagement expenses, divided by the number of business days for each fiscal period and annualized by multiplying by 365 days / average balance ofborrowings and investment corporation bonds for each fiscal period(Note 4) Average maturity is arrived at by calculating a weighted average of maturities from the end of the 43rd fiscal period to the repayment deadlines for all interestbearing debts based on the balance of each interest-bearing debt.

93Asset Management ReportJapan Prime Realty Investment Corporation(3) Additional
Additional Offerings,(3)
Offerings,Etc.
Etc.

4.

The table below indicates additional offerings, etc. JPR has conducted in the last five years.
Date

Number of Units
Outstanding

Event

Variation

Unitholders' Capital(millions of yen)

Balance

Variation

Remarks

Balance

March 3, 2020

Additional public offering

35,250958,250

16,207

247,860(Note 1)January 18, 2022
February 16, 2022

Additional public offering
Third-party allotment

38,100828

996,350
997,178

13,594295

261,455
261,751(Note 2)
(Note 3)(Note 1) New investment units were issued through a public offering at 474,810 yen per unit (underwriting price of 459,790 yen per unit) to fund acquisition of new specified
assets and partly repay debts.
(Note 2) New investment units were issued through a public offering at 368,480 yen per unit (underwriting price of 356,824 yen per unit) to fund acquisition of new specified
assets and partly repay debt.
(Note 3) New investment units were issued through a third-party allotment at 356,824 yen per unit to partly repay debt.

(4) CashCash Distributions
Distributions(4)

5.

With regard to the cash distributions of the 43rd fiscal period, JPR decided to distribute part of the retained earnings brought forwardthat had been internally reserved through the 42nd fiscal period, with the aim of having the profit distributions deducted as expenses
based on application of the special provision on taxation of investment corporations (Article 67-15 of the Act on Special Measures
Concerning Taxation) and in order to minimize the burden to unitholders incurred by accrual of corporate income tax, etc. In addition,
for the 43rd fiscal period, JPR decided to internally reserve 520 million yen as reserve for reduction entry from the unappropriatedretained earnings, pursuant to the Special Provisions for Taxation in Cases of Repurchase of Specified Assets (Article 65-7 of the Act
on Special Measures Concerning Taxation). As a result, the cash distribution per unit came to 7,600 yen for the 43rd fiscal period.
(Thousands of yen unless otherwise indicated)
39th Fiscal
Period(Jan. 1, 2021 –Jun. 30, 2021)

40th Fiscal
Period(Jul. 1, 2021 Dec. 31, 2021)

41st Fiscal
Period(Jan. 1, 2022 –Jun. 30, 2022)

42nd Fiscal
Period(Jul. 1, 2022 Dec. 31, 2022)

43rd Fiscal
Period(Jan. 1, 2023 –Jun. 30, 2023)

8,129,659

7,901,374

8,614,933

8,476,171

8,104,860

792,338

666,586

836,945821,989

526,307

Total Cash Distributions

7,337,320

7,234,787

7,777,988

7,728,129

7,578,552(Cash Distribution per Unit)(7,657 yen)

(7,550 yen)

(7,800 yen)

(7,750 yen)

(7,600 yen)

Fiscal Period

Unappropriated Retained Earnings at End of Period

BreakdownInternal Reserves

Total Cash Distributions from Net Income

7,337,320

7,234,787

7,777,988

7,728,129

7,578,552(Cash distribution from net income per unit)(7,657 yen)

(7,550 yen)

(7,800 yen)

(7,750 yen)

(7,600 yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)Repayment of Paid-in Capital(Repayment of paid-in capital per unit)

Of the repayment of paid-in capital, total cash distributions
from the reserve for temporary difference adjustments(Of the repayment of paid-in capital per unit, distribution perunit from the reserve for temporary difference adjustments)
Of the repayment of paid-in capital, total cash distributions
through the reduction in unitholders’ capital for tax purposes(Of the repayment of paid-in capital per unit, distribution perunit through the reduction in unitholders’ capital for tax
purposes)4

10

Asset Management ReportJapan Prime Realty Investment Corporation(5) Future
Future Management
Management Policies
CriticalIssues(5)
Policiesand
andCriticalIssues6.

For the moment, the Japanese economy is expected to keep recovering gradually, given the improving employment and income
environments and the effects of various policies. In particular, due to a rise in demand from inbound foreign tourists and consumer
spending as well as the growth in capital investment, etc., the Japanese economy is expected to remain solid going forward. However,attention should be paid to the concerns about possible stagnation in overseas economies and the impacts of fluctuations in the financial
and capital markets in and outside Japan.
The office property leasing market is anticipated to hit the bottom in an increasing manner, but close attention must be paid to theimpact of the increased supply of office buildings in Central Tokyo anticipated for 2023 and 2025. Under these circumstances, JPR isresolved to continue its endeavors to enhance the competitiveness of its owned properties, as it focuses on improving tenant satisfaction
through proactive implementation of value enhancement works and provision of elaborate management services.
In the for-sale real estate market, it has become even more important to discern the growth potential in earnings of respective properties,
while continuously taking into account the impact of the changes in the Japanese economy on the leasing market. In consideration of
the current situation in which the low-yield environment continues to stay, it is necessary to firmly keep the attitude of vigorously
selective investment for implementing real estate investment that assumes possession of properties over the medium to long term.
1) Acquisition of New Properties and Asset Replacement
JPR will continue to make investment focused on office properties in the Tokyo area, with an aim to improve the quality of its
portfolio and enhance its growth potential and stability over the long term. In the for-sale office property market, the purchase cap
rate and expected cap rate levels still stay low, with properties remaining in short supply. Although close attention must be paid to
the trends in the leasing market going forward, JPR will fully investigate the stability and growth potential of candidate properties
when acquiring them. As for retail properties, etc., JPR will work to invest in strictly selected blue-chip properties that can maintainstable revenues at a certain level in order to complement the stability of earnings of the entire portfolio. As it investigates properties,
JPR will continue its endeavors to acquire new properties under reasonable terms by negotiating prices based on detailed market
studies and property due diligence.
Moreover, JPR will make investment decisions by proactively collecting information in collaboration with Tokyo Tatemono Co.,
Ltd., the main sponsor of the Asset Manager, accurately assessing market trends and carefully researching investment value,
including the future potential of candidate properties.
Furthermore, JPR will also investigate asset replacement by taking into consideration the timing of implementation, in order toimprove the quality of its portfolio and enhance its growth potential over the long term.
2) Management of Portfolio
JPR will aim to secure stable earnings over the medium to long term by working to prevent move-outs of existing tenants, encouragethem to expand office spaces in the same buildings and renew contracts with upward revision of rents through endeavors to enhancetenant satisfaction, while continuously inviting new tenants through strategic leasing activities. Specifically, JPR will conduct
management and operations based on the following policies:- Strengthen coordination with property management companies and respective tenant brokers- Propose leasing terms and conditions in consideration of the current leasing market situations and promote rapid decision making- Conduct strategic value enhancement works with the intent to improve property earnings and increase tenant satisfaction- Reinforce responses to business continuity plans and environmental friendliness that command high social demand3) Fund Procurement
In accordance with its basic policy of implementing conservative financial operations that focus on stability, JPR will control its
LTV in a conservative manner. In debt financing, JPR will endeavor to further lengthen the maturity with a focus on stability in aneffort to diversify the repayment dates of interest-bearing debts and reduce the repayment amount for each fiscal period, with aneye on reducing refinancing risks that may arise in accordance with future changes in the financial environment. Moreover, JPR
intends to work on fund procurement through issuance of investment corporation bonds as it aims to diversify fund procurementmeans and sources.

115

Asset Management ReportJapan Prime Realty Investment Corporation(6) Information
Information Disclosure(6)
Disclosure

7.

Positioning the proactive voluntary disclosure of information as one of its key management policies, JPR voluntarily discloses
information believed to be useful to investment decisions, along with the information disclosure required by the Tokyo Stock Exchange
and set forth by laws and regulations, etc. As a means for implementing voluntary disclosure, JPR is proactively employing its website(https://www.jpr-reit.co.jp/en/) to provide information including monthly occupancy rates of all properties in the portfolio and historical
data, offer expanded information on sustainability and deliver video presentation on financial results sessions for securities analysts.

(7) Significant
Significant Subsequent
Events(7)
Subsequent
Events8.

Not applicable

612Asset Management ReportJapan Prime Realty Investment Corporation

2.
ofthe
theInvestment
Investment
Corporation
2. Overview
Overview ofCorporation(1) Unitholders’
Unitholders’ Capital(1)
Capital9.

Total number of authorized units

39th Fiscal
Period as ofJune 30, 2021
5,000,000

40th Fiscal
Period as ofDecember 31, 2021
5,000,000

41st Fiscal
Period as ofJune 30, 2022
5,000,000

42nd Fiscal
Period as ofDecember 31, 2022
5,000,000

43rd Fiscal
Period as ofJune 30, 2023
5,000,000

Total number of units issued andoutstanding
Unitholders' capital (millions of yen)

958,250

958,250

997,178

997,178

997,178

247,860

247,860

261,751

261,751

261,751

Total number of unitholders

10,531

10,22910,506

10,435

10,554(2) Matters
Matters Related
Related to(Primary
Investors)(2)
toInvestment
InvestmentUnits
Units(Primary
Investors)

10.

The following table shows the ten largest investors according to the percentage of their owned investment units to the total number ofinvestment units outstanding as of the end of the 43rd fiscal period.
Name

Address

Number ofPercentage of Total

Owned Units

Units Outstanding (%)

Custody Bank of Japan, Ltd. (Trust Account)

1-8-12 Harumi, Chuo-ku, Tokyo

312,808

31.36

The Master Trust Bank of Japan, Ltd. (Trust Account)

2-11-3 Hamamatsucho, Minato-ku, Tokyo

158,283

15.87

The Nomura Trust and Banking Co., Ltd.
(Investment Trust Account)

2-2-2 Otemachi, Chiyoda-ku, Tokyo

46,466

4.65

Tokyo Tatemono Co., Ltd.

1-4-16 Yaesu, Chuo-ku, Tokyo

29,3002.93

Kawasaki Gakuen

577 Matsushima, Kurashiki-shi, Okayama

25,0002.50

Meiji Yasuda Life Insurance Company

2-1-1 Marunouchi, Chiyoda-ku, Tokyo

24,0002.40

State Street Bank West Client - Treaty 505234(Standing Proxy: Settlement & Clearing Services
Department, Mizuho Bank, Ltd.)SSBTC CLIENT OMNIBUS ACCOUNT (Standing
proxy: Custody Services Department, Tokyo Branch, The
Hongkong and Shanghai Banking Corporation Limited)
State Street Bank and Trust Company 505103 (Standing
Proxy: Settlement & Clearing Services Department,
Mizuho Bank, Ltd.)

1776 Heritage Drive, North Quincy, MA
02171, U.S.A. (Shinagawa Intercity Building
A, 2-15-1 Konan, Minato-ku, Tokyo)
One Lincoln Street, Boston, MA 02111,
U.S.A.
(3-11-1 Nihonbashi, Chuo-ku, Tokyo)

13,806

1.38

13,208

1.32

P.O. Box 351, Boston, MA 02101, U.S.A.
(Shinagawa Intercity Building A, 2-15-1
Konan, Minato-ku, Tokyo)

12,043

1.20

The Shinkumi Federation Bank

1-9-5 Kyobashi, Chuo-ku, Tokyo

11,0891.11

646,003

64.78

Total
(Note) Percentage of total units outstanding is rounded down to the second decimal place.

13

7

Asset Management ReportJapan Prime Realty Investment Corporation(3) Items
Items Related(3)
Relatedto
toDirectors
Directors

11.

A. The Executive Officer, Supervising Officers and Independent Auditor as of the end of the 43rd fiscal period are as follows.
Position
Executive Officer

Name
Yoshihiro Jozaki
Masato Denawa

Supervising
Officers (Note 2)

Nobuhisa Kusanagi

Konomi Ikebe
Independent Auditor

Other Current Assignments
President and Chief Executive Officer, Tokyo Realty
Investment Management, Inc.

Total Directors' Fee
during the 43rd Fiscal
Period (thousands of yen)–
(Note 1)

Partner Attorney, Spring Partners
Group Representative Partner of GYOSEI Certified
Public Tax & Accountants' Co.
Representative, Nobuhisa Kusanagi Certified Public
Accountant Office

Numberof Owned
Units

–

6,300

Grand Fellow, The Chiba University Graduate School of
Horticulture

EY ShinNihon LLC

–

–

–

–
14,700(Note 3)–(Note 1) Yoshihiro Jozaki, Executive Officer, does not receive any compensation from JPR.
(Note 2) Supervising officers may be directors of corporations other than those indicated above, but have no conflict of interest with JPR at those and the above positions.
(Note 3) The independent auditor fees include fees regarding auditing of JPR’s English financial statements.

B. Policy on Dismissing and Deciding Not to Reappoint the Independent Auditor
The dismissal of independent auditors shall be considered in accordance with the designations of the Investment Trusts Act. The
decision not to reappoint the auditor shall be studied at JPR’s Board of Directors Meetings following comprehensive considerationof circumstances including audit quality, audit fee and other various conditions.

(4) Matters
Matters Concerning
andOfficers
Liability
Insurance
Agreement(4)
ConcerningDirectors
Directors
andOfficers
Liability
Insurance
Agreemet

12.

JPR has entered into a directors and officers liability insurance agreement as follows.
Scope of the Insured

Overview of Agreement[Overview of insured event covered by the insurance]
The agreement covers such losses as compensation payment and dispute costs to be borne by the insured when they receive
a claim for compensation for the unjust actions they have taken based on their positions at JPR.

Executive Officer and all
Supervising Officers of JPR[Burden ratio of insurance premium]
JPR bears the entire amount of the insurance premium.
[Measures to ensure the appropriateness of the execution of duties by directors and officers]
The agreement does not protect the actions, etc. which the insured executed while recognizing that it may constitutecriminal act or violate the laws and regulations.

(5) Asset
Asset Manager,
andAdministrative
Agent
(5)
Manager,Asset
AssetCustodian
Custodian
andAdministrative
Agent

13.

The asset manager, asset custodian and administrative agents of JPR at the end of the 43rd fiscal period are as follows.
Outsourcing Category

8

Asset manager

Name
Tokyo Realty Investment Management, Inc.

Asset custodian
Administrative agent (administration, etc. concerning unitholders' list, etc.)

Mizuho Trust & Banking Co., Ltd.
Mizuho Trust & Banking Co., Ltd.

Administrative agent(administration concerning investment corporation bonds)

Mizuho Bank, Ltd.

14

Asset Management ReportJapan Prime Realty Investment Corporation

3.
of JPR’s
JPR’s Assets
AssetsUnder
UnderManagement
Management
3. Status
Status of(1)
Structure(1) JPR’s
JPR’sAsset
Asset Structure

14.

Asset TypeReal estate

Real estate in trust

42nd Fiscal Period(as of December 31, 2022)

Area

43rd Fiscal Period(as of June 30, 2023)

Assets owned by JPR(thousands of yen)

Percentage of total
assets (%)

Assets owned by JPR(thousands of yen)

Percentage of total
assets (%)

Central Tokyo

111,801,978

22.0

111,765,234

21.9

Greater Tokyo
Other Cities

67,281,625
19,814,414

13.3
3.9

67,088,046
25,699,043

13.2
5.0

Central Tokyo

152,469,216

30.0

155,480,973

30.5Greater Tokyo
Other Cities

61,169,274
47,245,195

12.0
9.3

60,994,630
47,339,964

12.0
9.3

Deposits and otherassets–47,873,742
(–)

9.4
(–)

41,701,788
(–)

8.2
(–)

Total assets–

507,655,447(459,781,704)

100.0(90.6)

510,069,681(468,367,893)

100.0(91.8)(Note 1) Total assets owned by JPR are based on the amounts appropriated on the Balance Sheet as of the end of the fiscal periods (book values after depreciation for realestate and real estate in trust).
(Note 2) Figures in parenthesis are portions that practically fall on real estate owned in the object assets.

(2)
OwnedbybyJPR
JPR(2) Major
Major Assets
Assets Owned

15.

The following is an overview of the major assets (ten largest properties by book value at end of period) owned by JPR as of the end of
the 43rd fiscal period.
Occupancy Rate(%)

Rate of Monthly
Contracted Rent at
End of Period (%)

11,034.78

100.0

11.2

Office23,987.40

22,541.16

94.0

5.5

Office10,417.25
5,971.69

10,042.80
5,928.51

96.4
99.3

3.7
2.5

OfficeOffice15,476,647

15,233.17

14,979.23

98.3

3.6

Office14,660,913

6,177.74

6,177.74

100.0

1.8

OfficeKanematsu Bldg.

14,634,509

8,090.74

7,689.05

95.0

2.3

OfficeSencity Bldg.
Kawasaki Dice Bldg.

13,995,293
12,839,462

13,271.26
12,113.10

12,459.71
11,920.13

93.9
98.4

2.6
2.1

OfficeRetail, etc.
OfficeBook Value(thousands of yen)

Leasable Floor
Space (m2)Otemachi Tower (Landwith Leasehold Interest)

38,388,259

11,034.78

Olinas Tower

25,508,406

Shinjuku Center Bldg.
Tokyo Square Garden

24,114,675
18,242,646

BYGS Shinjuku Bldg.
JPR Sendagaya Bldg.

Property Name

Shinjuku Square Tower
Total

Leased Floor
Space (m2)

12,782,373

19,266.47

18,637.22

96.7

2.7

190,643,186

125,563.60

121,410.33

96.7

38.0

Asset Class(Note 1) Rate of monthly contracted rent at end of period is the rate arrived at by dividing the monthly contracted rent at end of period for each property by the total rents
for all properties.
(Note 2) The tenants of Shinjuku Center Bldg., Tokyo Square Garden, Sencity Bldg., Kawasaki Dice Bldg. and Shinjuku Square Tower have sublet space to a sub-lessee
and a lease agreement has been executed where the rent paid by the tenant fluctuates in accordance with the lease conditions of the sub-lessee. Therefore, theleasable floor space, leased floor space and occupancy rate entered for each of these buildings are the figures concerning the sub-lessees of the tenant.

15

9Asset Management ReportJapan Prime Realty Investment Corporation(3) Itemized
Itemized Portfolio(3)
PortfolioAssets
Assets16.

The following table provides an overview of the real estate properties and beneficiary interests in real estate owned by JPR as of theend of the 43rd fiscal period (June 30, 2023).
Area Type

Property Name
Kanematsu Bldg.

17-5 Kyobashi 2-chome, Chuo-ku, Tokyo

JPR Ningyo-cho Bldg.

17-4 Nihonbashi Ningyocho 1-chome,
Chuo-ku, Tokyo

Shin-Kojimachi Bldg.

3-3 Kojimachi 4-chome, Chiyoda-ku, Tokyo

JPR Ichigaya Bldg.
Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Bldg.

Office14,100,000

2,365,907

2,960,000

2,090,949

3,140,000

2,415,898

4,300,000

10,737,604

15,500,000

5,207,541

4,940,000

2,689,139

5,180,000

12,782,373

15,400,000

15,476,647

19,300,000
808,000

Real estate

24,114,675

21,500,000

Real estate

3,764,913

3,390,000

Shinagawa Canal Bldg.

Real estate

1,859,458

2,320,000

Rokubancho Bldg.

2-9, etc., Rokubancho, Chiyoda-ku, Tokyo

2,903,460

3,730,000

JPR Harajuku Bldg.

17-11 Jingumae 6-chome, Shibuya-ku, Tokyo

Real estate
Beneficiaryinterest
Beneficiaryinterest
Real estate

8,865,023

10,500,000

4,821,690

6,850,000

14,660,913

11,900,000

JPR Sendagaya Bldg.

11-12 Nihonbashi-Horidomecho 1-chome,
Chuo-ku, Tokyo
23-5 Sendagaya 4-chome, Shibuya-ku, Tokyo

Ginza Sanwa Bldg.
Otemachi Tower (Land with
Leasehold Interest)

6-1 Ginza 4-chome, Chuo-ku, Tokyo
6-6, etc., Otemachi 1-chome, Chiyoda-ku,
Tokyo

JPR Nihonbashi-horidome Bldg.

Retail, etc.

14,634,509

565,972

Minami Azabu Bldg.

Real estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

3,681,726

3,880,000

38,388,259

54,600,000

2,757,746

3,470,000

4,162,656

6,600,000

18,242,646

21,400,000

Science Plaza-Yonbancho Plaza

9-6, etc., Yonbancho, Chiyoda-ku, Tokyo

Shibadaimon Center Bldg.

10-11 Shibadaimon 1-chome, Minato-ku,
TokyoTokyo Square Garden

1-1 Kyobashi 3-chome, Chuo-ku, TokyoJPR Kojimachi Bldg.

6-1 Kojimachi 5-chome, Chiyoda-ku, Tokyo

Real estate

5,833,556

6,250,000

Otemachi Financial City North Tower

9-5, Otemachi 1-chome, Chiyoda-ku, Tokyo

Real estate

11,467,282

13,000,000

Tokyo Tatemono Higashi Shibuya
Bldg.

26-20 Higashi 1-chome, Shibuya-ku, Tokyo

Real estate

11,553,378

12,300,000

Ochanomizu Sola City

6-1 Kanda-Surugadai 4-chome, Chiyoda-ku,
Tokyo and others

6,528,653

7,170,000

JPR Shibuya Tower Records Bldg.

22-14 Jinnan 1-chome, Shibuya-ku, Tokyo

11,397,882

14,600,000

JPR Jingumae 432

32-13 Jingumae 4-chome, Shibuya-ku, Tokyo

4,248,315

4,100,000

Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
JPR Ginza Namiki-dori Bldg.

1-26, Shinjuku 3-chome, Shinjuku-ku, Tokyo

Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Real estate

2,502,775

2,370,000

7-1 Yurakucho 2-chome, Chiyoda-ku, Tokyo

Real estate

3,248,810

3,510,000

5-14 Ginza 5-chome, Chuo-ku, Tokyo
20-8 Kanda Misakicho 2-chome, Chiyoda-ku,
TokyoReal estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

10,131,662

11,100,000

3,144,173

3,470,000

4,183,316

6,600,000

2,125,580

1,910,000

2,301,986

2,460,000

1,417,344

2,630,000

7,111,541

11,400,000

2,838,432

5,870,000

2,838,512

4,620,000

12,335,828

18,500,000

5,038,064

7,400,000

FUNDES Suidobashi
Arca East
JPR Chiba Bldg.
JPR Yokohama Nihon Odori Bldg.
Shinyokohama 2nd Center Bldg.
OfficeBeneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Real estateAppraisal ValueBook Valueas of June 30, 2023
as of June 30, 2023
(thousands of yen)(thousands of yen)
(Note)

Real estate

Shinjuku Center Bldg.

Central Tokyo

13-23 Shibaura 4-chome, Minato-ku, Tokyo
7-15 Kudan-Minami 4-chome, Chiyoda-ku,
Tokyo
17-1 Higashi-Gotanda 2-chome,
Shinagawa-ku, Tokyo
22-1 Nishi-Shinjuku 6-chome, Shinjuku-ku,
Tokyo
19-1 Shinjuku 2-chome, Shinjuku-ku, Tokyo

Type ofOwnership

16-14 Shinkawa 1-chome, Chuo-ku, Tokyo
25-1 Nishi-Shinjuku 1-chome, Shinjuku-ku,
Tokyo
12-3 Minami-Azabu 2-chome, Minato-ku,
Tokyo
12-33 Konan 2-chome, Minato-ku, Tokyo

Across Shinkawa Bldg. Annex

Greater Tokyo

14-1 Kyobashi 2-chome, Chuo-ku, Tokyo

Kanematsu Bldg. Annex

MS Shibaura Bldg.

2-1 Kinshi 3-chome, Sumida-ku, Tokyo
1-7, etc., Shinmachi, Chuo-ku, Chiba, Chiba
17 Nihon-Odori, Naka-ku, Yokohama,
Kanagawa
19-5, etc., Shinyokohama 3-chome,
Kohoku-ku, Yokohama, Kanagawa

Kawaguchi Center Bldg.

1-8 Honcho 4-chome, Kawaguchi, Saitama

JPR Ueno East Bldg.

3-5 Matsugaya 1-chome, Taito-ku, Tokyo

Real estate38-5 Akebonocho 2-chome, Tachikawa,Tokyo
5-2 Higashi-Ikebukuro 4-chome, Toshima-ku,
Tokyo
6-1 Kamiooka Nishi 1-chome, Konan-ku,
Yokohama, Kanagawa

Beneficiaryinterest
Beneficiaryinterest

Tachikawa Business Center Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower

10

Location

16

Real estateAsset Management Report

Area Type

Property NameJPR Yokohama Bldg.
JPR Omiya Bldg.
Sencity Bldg.
Tanashi ASTA
Cupo-la Main Bldg.

Retail, etc.

Greater Tokyo

OfficeOlinas Tower

JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
FUNDES Ueno
Niigata Ekinan Center Bldg.
JPR Naha Bldg.
Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.

OfficeOther Cities

JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden
JPR Shinsaibashi Bldg.
JPR Shinsaibashi West
GRAND FRONT OSAKA(Umekita Plaza and South Building)Retail, etc.

GRAND FRONT OSAKA(North Building)
Osaka Dojima Bldg.
Housing Design Center Kobe

Japan Prime Realty Investment Corporation

Location
1-3 Taihei 4-chome, Sumida-ku, Tokyo
5-10 Kitasaiwai 1-chome, Nishi-ku,
Yokohama, Kanagawa
1-1, etc., Shimocho 2-chome, Omiya-ku,
Saitama, Saitama
1000, etc., Shinmachi, Chuo-ku, Chiba-shi,
Chiba
1-1 Tanashicho 2-chome, Nishitokyo, Tokyo
1-1 Kawaguchi 1-chome, Kawaguchi,
Saitama
420-1,etc., Kosugimachi 3-chome,
Nakahara-ku, Kawasaki, Kanagawa
3-1 Bessho 7-chome, Minami-ku, Saitama,
Saitama
8-3, etc., Ekimae-Honcho, Kawasaki-ku,
Kawasaki, Kanagawa
2-4 Ueno 7-chome, Taito-ku, Tokyo
24 Yoneyama 1-chome, Chuo-ku, Niigata,
Niigata
1-19 Matsuyama 1-chome, Naha, Okinawa
7-35 Tsutsujigaoka 3-chome, Miyagino-ku,
Sendai, Miyagi
31-1, etc., Misonocho 3-chome, Wakayama,
Wakayama
3-38 Tenjin 1-chome, Chuo-ku, Fukuoka,
Fukuoka
1-23 Sonezaki-Shinchi 2-chome, Kita-ku,
Osaka, Osaka
24-15 Sakae 1-chome, Naka-ku, Nagoya,Aichi
1-1 Yakuin 1-chome, Chuo-ku, Fukuoka,
Fukuoka
2-11 Minamisemba 4-chome, Chuo-ku,
Osaka, Osaka
11-28 Minamisemba 4-chome, Chuo-ku,
Osaka, Osaka
4-1 Ofuka-cho, Kita-ku, Osaka, Osaka(Umekita Plaza)
4-20 Ofuka-cho, Kita-ku, Osaka, Osaka(South Building)
3-1 Ofuka-cho, Kita-ku, Osaka, Osaka
3-5 Dojima 2-chome, Kita-ku, Osaka, Osaka
2-2 Higashi-Kawasakicho 1-chome, Chuo-ku,
Kobe, Hyogo

JPR Chayamachi Bldg.

2-19 Chayamachi, Kita-ku, Osaka, Osaka

FUNDES Tenjin Nishidori

3-21 Tenjin 2-chome, Chuo-ku, Fukuoka,
Fukuoka

Total

Type ofOwnership
Real estateAppraisal ValueBook Valueas of June 30, 2023
as of June 30, 2023
(thousands of yen)(thousands of yen)
(Note)
25,508,406
40,200,000

Real estate

7,371,888

10,100,000

Beneficiaryinterest

5,553,362

10,700,000

Real estate

13,995,293

15,700,000

Beneficiaryinterest

6,860,346

11,100,000

Real estate

1,540,941

3,080,000

Real estate

7,084,303

5,370,000

3,427,349

4,300,000

12,839,462

12,800,000

3,710,715

4,090,000

1,499,834

2,180,000

1,631,456

2,370,000

2,301,612

4,140,000

1,302,718

1,510,000

1,963,385

4,080,000

2,081,479

4,020,000

Real estate

3,786,518

3,490,000

Real estate

9,968,737

23,700,000

5,287,074

4,700,000

3,955,642

4,910,000

11,822,034

12,300,000

9,529,637

10,100,000

Beneficiaryinterest
Beneficiaryinterest
Real estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Real estate

2,507,666

2,760,000

Real estate

6,088,680

7,340,000

Beneficiaryinterest

5,965,088

8,390,000

Real estate

3,347,439

3,640,000

468,367,893

592,098,000(Note) The appraisal values at end of period are either appraisal values or survey values by real estate appraisers, based on the Cabinet Office Order on “Regulations on
calculations of investment corporations.”17

Asset Management ReportJapan Prime Realty Investment Corporation

The following table provides changes in rental business results for each of JPR’s real estate properties and beneficiary interests in realestate.

OfficeOfficeOfficeOther Cities

Retail, etc.

Greater Tokyo

Retail, etc.

Central Tokyo

Area Type

Property Name

Kanematsu Bldg.
Kanematsu Bldg. Annex
JPR Ningyo-cho Bldg.
Shin-Kojimachi Bldg.
JPR Crest Takebashi Bldg. (Note 3)
MS Shibaura Bldg.
Gotanda First Bldg. (Note 4)
JPR Ichigaya Bldg.
Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Bldg.
Across Shinkawa Bldg. Annex
Shinjuku Center Bldg. (Note 5)
Minami Azabu Bldg.
Shinagawa Canal Bldg.
Rokubancho Bldg.
JPR Harajuku Bldg.
JPR Nihonbashi-horidome Bldg.
JPR Sendagaya Bldg.
Ginza Sanwa Bldg.
Otemachi Tower (Land with Leasehold
Interest)
Science Plaza-Yonbancho Plaza
Shibadaimon Center Bldg.
Tokyo Square Garden
JPR Kojimachi Bldg.
Otemachi Financial City North Tower
Tokyo Tatemono Higashi Shibuya Bldg.
Ochanomizu Sola CityJPR Shibuya Tower Records Bldg.
JPR Jingumae 432
Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
JPR Ginza Namiki-dori Bldg.
FUNDES Suidobashi
Arca East
JPR Chiba Bldg.
JPR Yokohama Nihon Odori Bldg.
Shinyokohama 2nd Center Bldg.
Kawaguchi Center Bldg.
JPR Ueno East Bldg.
Tachikawa Business Center Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower
Olinas Tower
JPR Yokohama Bldg.
JPR Omiya Bldg.
Sencity Bldg.
Tanashi ASTA
Cupo-la Main Bldg.
JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
FUNDES Ueno
Niigata Ekinan Center Bldg.
JPR Naha Bldg.
Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.
JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden
JPR Shinsaibashi Bldg.
JPR Shinsaibashi West
GRAND FRONT OSAKA(Umekita Plaza and South Building)
GRAND FRONT OSAKA(North Building)
Osaka Dojima Bldg.

42nd Fiscal Period
43rd Fiscal Period(from Jul. 1, 2022 to Dec. 31, 2022)(from Jan. 1, 2023 to Jun. 30, 2023)
RentalRentalRatio to Number
Ratio toNumber of Occupancy Revenues
Occupancy Revenues
Total of Tenants
Total
Tenants at Rate at throughout
Rate atthroughout
Rental at Period
RentalPeriod End Period End
PeriodPeriod End
PeriodRevenues
End
Revenues(Note 1)(%)(thousands(%)(thousands(%)(Note 1)(%)
of yen)of yen)12
100.0
464,7732.7
11
95.0
378,1962.2
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
5
100.0
95,0300.5
5100.0
92,8080.5
1788.1
101,1250.6
19
97.0
109,5170.6
789.2
114,803
0.7－－
65,1690.4
10100.0
496,498
2.9
10
100.0
486,590
2.8－－
253,100
1.5
－
－
－
－
8
84.0
150,7510.9
884.0
140,5810.8
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)26
91.5
405,5732.3
28
96.7
406,1202.3
2398.4
610,8513.5
23
98.3
626,0413.6
4
100.0
38,7310.2
4
100.0
39,2130.2
26
94.8
550,6523.2
26
96.4
619,0223.6
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
6
100.0
75,5930.4
6
100.0
74,5400.4
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
9
91.7
289,9981.7
10
77.1
221,9191.3
5100.0
195,1441.1
5
100.0
195,8881.1
6
100.0
303,4411.7
6100.0
314,1501.8
9100.0
122,7360.7
9100.0
121,292
0.7
2

100.0

1,802,000

10.4

2

100.0

1,801,750

10.4

25
9
49
8
9
17
－
1
7
1

100.0
100.0
95.5
100.0
99.9
100.0
－
100.0
100.0
100.0

117,657
165,447
373,660
127,877
284,269
307,659－(Note 2)
91,213(Note 2)

0.7
1.0
2.1
0.7
1.6
1.8
－
(Note 2)0.5
(Note 2)

24
9
50
8
9
16
22
1
6
1

98.3
100.0
99.3
100.0
99.9
100.0
99.0
100.0
77.1
100.0

118,256
185,416
378,794
136,349
293,244
328,957(Note 2)
(Note 2)
79,685(Note 2)

0.7
1.1
2.2
0.8
1.7
1.9
(Note 2)
(Note 2)0.5
(Note 2)1100.0(Note 2)

(Note 2)1100.0(Note 2)

(Note 2)

9
5
7
42
19
24
40
10
21
8
43
18
21
6
70
1
1
1
3
29
10
11
23
15
18
14
12
6
16
8
13

100.0
87.2
100.0
98.5
100.0
100.0
100.0
100.0
93.2
100.0
99.1
89.6
100.0
70.6
94.0
100.0
100.0
100.0
100.0
98.4
100.0
100.0
100.0
99.9
99.8
82.3
100.0
99.8
99.9
100.0
95.9

202,905
75,655
273,024
140,610135,258
117,598
487,237
185,978
142,486
433,829
353,080
904,822295,254
191,288479,804(Note 2)
(Note 2)
(Note 2)
127,041465,702
127,726
126,696
118,600
199,190
109,825
107,440
138,406
153,730
620,763
132,541
152,141

1.2
0.4
1.6
0.8
0.8
0.7
2.8
1.1
0.8
2.5
2.0
5.2
1.7
1.1
2.8
(Note 2)
(Note 2)
(Note 2)
0.7
2.7
0.7
0.7
0.7
1.1
0.6
0.6
0.8
0.9
3.6
0.8
0.9

9
5
7
43
19
24
40
10
22
8
44
20
20
11
71
1
1
1
3
29
10
11
23
15
18
15
12
6
16
8
13

100.0
87.2
100.0
100.0
100.0
100.0
97.6
100.0
98.0
100.0
100.0
94.0
83.8
100.0
93.9
100.0
100.0
100.0
100.0
98.4
100.0
100.0
100.0
99.7
99.8
78.4
100.0
99.8
99.9
100.0
99.9

202,343
78,078272,718
142,347
136,375
123,336
486,053
185,437
146,939
490,314354,035
914,825
320,581
216,930
496,316(Note 2)
(Note 2)
(Note 2)
127,041
488,155
127,324
128,157
118,121202,755
111,144
107,101
138,449
158,467
619,189
130,830
146,713

1.2
0.5
1.6
0.8
0.8
0.7
2.8
1.1
0.8
2.8
2.0
5.3
1.9
1.3
2.9
(Note 2)
(Note 2)
(Note 2)
0.7
2.8
0.7
0.7
0.7
1.2
0.6
0.6
0.8
0.9
3.6
0.8
0.8

243

91.4

(Note 2)

(Note 2)

247

93.9

(Note 2)

(Note 2)

101

98.5

(Note 2)

(Note 2)9798.0

(Note 2)

(Note 2)

－

－

－

－

10

100.0

74,8120.4

18Asset Management Report

Retail, etc.

Other
CitiesArea TypeJapan Prime Realty Investment Corporation

42nd Fiscal Period
43rd Fiscal Period(from Jul. 1, 2022 to Dec. 31, 2022)(from Jan. 1, 2023 to Jun. 30, 2023)
RentalRentalRatio to Number
Ratio toNumber of Occupancy Revenues
Occupancy Revenues
Total of Tenants
Total
Tenants at Rate at throughout
Rate atthroughout
Rental at Period
RentalPeriod End Period End
PeriodPeriod End
PeriodRevenues
End
Revenues(Note 1)(%)(thousands(%)(thousands(%)(Note 1)(%)
of yen)of yen)(Note 2) (Note 2)
－
－
－
－
1
100.0
(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
5
100.0
181,4691.0
5
100.0
179,883
1.0
－
－
－
－
6
100.0
58,5390.3
1,180
97.6 17,392,648
100.0
1,224
98.1 17,291,965
100.0

Property NameJPR Umeda Loft Bldg. (Note 6)
Housing Design Center Kobe
JPR Chayamachi Bldg.
FUNDES Tenjin Nishidori
Total(Note 1) The number of tenants at end of period is counted as follows except for Shinjuku Square Tower, Shinjuku Center Bldg., the residential section of Science PlazaYonbancho Plaza, Tokyo Square Garden, Otemachi Financial City North Tower, Rise Arena Bldg., Sencity Bldg. and Kawasaki Dice Bldg.: when a single tenantleases multiple rooms, it is counted as one if the tenant uses the same property. If the leased rooms are in multiple buildings, the tenant is counted in plural.
The tenants of Shinjuku Square Tower, Shinjuku Center Bldg., the residential section of Science Plaza-Yonbancho Plaza, Tokyo Square Garden, Otemachi Financial
City North Tower, Ochanomizu Sola City, Rise Arena Bldg., Sencity Bldg., Kawasaki Dice Bldg., GRAND FRONT OSAKA (Umekita Plaza and South Building)and part of GRAND FRONT OSAKA (North Building) have sublet space to sublessees and lease agreements have been executed where the rent paid by the tenants
fluctuates in accordance with the lease conditions of the sublessees and thus the numbers of sublessees have been entered as the numbers of tenants (for GRANDFRONT OSAKA (North Building), some portions employ fixed master lease or direct lease, but the figure indicates the number of end tenants, including those ofsuch portions.).
(Note 2) JPR does not disclose the rental revenues throughout period of the properties and their ratio to total rental revenues due to inevitable reasons, as no consent todisclosure has been obtained from the tenants or co-owners.
(Note 3) JPR sold JPR Crest Takebashi Bldg. on April 12, 2023.
(Note 4) JPR sold Gotanda First Bldg. on December 22, 2022 through an exchange transaction.
(Note 5) For Shinjuku Center Bldg., JPR additionally acquired 7.0% co-ownership interest of the sectionally-owned building (equivalent to 21.5% of the entire building)through an exchange transaction on December 22, 2022.
(Note 6) For JPR Umeda Loft Bldg., JPR sold its 40.0% co-ownership interest on December 24, 2021 and 30.0% co-ownership interest on June 30, 2022 and sold theremaining 30.0% co-ownership interest on December 23, 2022.

(4)Status
Statusofof Other
Other Assets
Assets(4)17.

Beneficiary interests with real estate as major entrusted properties have been included in (3) Itemized Portfolio Assets above. There
were no additional major specified assets that are main investment targets of JPR other than those listed under (3) above and thoseindicated below as of the end of the 43rd fiscal period.
1) Stock
Issuer Name

Number of
SharesKMO Corporation

1,666

Acquisition Price(thousands of yen) (Note 1)

Appraisal Value(thousands of yen) (Note 2)

Unit Price

Unit Price

50

Amount83,740

Amount50

83,740

Profit andLoss from
Valuation

Remarks－－(Note 1) The acquisition price indicates the amount that includes the expenses required for the acquisition.
(Note 2) The appraisal value indicates the book value.

2) Other securities
Type of AssetBook Value(thousands of yen)

VolumeClaim for refund of funds

Unit Price
1

Appraisal Value(thousands of yen) (Note 1)

AmountUnit Price

5,120

－

Amount5,120－Profit andLoss from
Valuation－

Remarks(Note 2)

(Note 1) The appraisal value indicates the book value.
(Note 2) The asset is a claim for refund of funds of Knowledge Capital, a general incorporated association.

3) Other assets
Type of Asset
Claim for refund of funds

Book Value(thousands of yen)

VolumeUnit Price
1－

Appraisal Value(thousands of yen) (Note 1)

Amount710

Unit Price

Amount－(Note 1) The appraisal value indicates the book value.
(Note 2) The asset is a claim for refund of funds of GRAND FRONT OSAKA TMO, a general incorporated association.

19

710

Profit andLoss from
Valuation－

Remarks(Note 2)Asset Management ReportJapan Prime Realty Investment Corporation

4.
ExpendituresofofOwned
Owned
Real
Estate4. Capital
Capital Expenditures
RealEstate(1) Planned
Planned Capital(1)
CapitalExpenditures
Expenditures

18.

The following are major items of capital expenditures for renovation works, etc. planned as of the end of the 43rd fiscal period for JPRowned real estate and entrusted real estate regarding beneficiary interests in real estate. Furthermore, the planned construction expenses
include portions that are classified as expenses in accounting.

Property NameJPR Yokohama Bldg.
Housing Design
Center Kobe
Kawaguchi Center
Bldg.
JPR Yokohama Bldg.
Shinjuku Center Bldg.
Shinjuku Center Bldg.
JPR Shinsaibashi
Bldg.
JPR Yokohama Bldg.

Location

PurposeSchedule

Yokohama,
Kanagawa

Replacement of interior fittings on the 8th and9th floors (partitioning, etc.)

Aug. 2023–Dec. 2023

182

–

–

Kobe, Hyogo

Third phase of replacement of toilets

Jul. 2023–Dec. 2023

107

–

–

First phase of replacement of toilets

Apr. 2023–Dec. 2023

107

–

–

Aug. 2023–Dec. 2023

94

–

–

Jul. 2023–Dec. 2023

86

–

–

First phase of replacement of piping equipment

Jul. 2023–Dec. 2023

77

–

–

Repair of exterior walls

Aug. 2023–Dec. 2023

65

–

–

Aug. 2023–Dec. 2023

61

–

–

Jul. 2023–Dec. 2023

56

–

–

Reinforcement of elevators (No.2)

Jul. 2023–Oct. 2023

49

–

–

Third phase of reinforcement of elevators

Apr. 2023–Dec. 2023

48

–

–

Repair of exterior walls

May 2023–Dec. 2023

48

–

–

Second phase of replacement of toilets

Apr. 2023–Sep. 2023

47

–

–

Replacement of security systems

Feb. 2023–Nov. 2023

45

–

–

Renovation of common areas

Oct. 2023–Dec.2023

41

1

1

Repair of exterior walls

Aug. 2023–Dec. 2023

40

–

–

Reinforcement of elevators (West No.25)

Jul. 2023–Dec. 2023

35

–

–

Reinforcement of elevators

Jul. 2023–Aug. 2023

33

–

–

Replacement of water receiving tanks andelevated water tanks

Oct. 2023–Nov. 2023

30

–

–

Kawaguchi,
Saitama
Yokohama,
Kanagawa
Shinjuku-ku,
TokyoShinjuku-ku,
Tokyo

Replacement of interior fittings on the 8th and9th floors (furniture and ceiling, etc.)
First phase of renewal of air handling units onstandard floors

Osaka, Osaka
Yokohama,
Kanagawa

Shinjuku-ku,
TokyoTokyo Tatemono
Shibuya-ku,
Higashi Shibuya Bldg. Tokyo
Minato-ku,
MS Shibaura Bldg.
Tokyo
JPR NihonbashiChuo-ku, Tokyo
horidome Bldg.
Across Shinkawa
Chuo-ku, Tokyo
Bldg. Annex
Sumida-ku,
Olinas Tower
Tokyo
Minato-ku,
MS Shibaura Bldg.
Tokyo
Tachikawa BusinessTachikawa,
Center Bldg.
Tokyo
Sencity Bldg.
Chiba, Chiba
Shibuya-ku,
JPR Harajuku Bldg.
Tokyo
BYGS Shinjuku Bldg.

JPR Naha Bldg.

Planned Amount (millions of yen)
Payment
AmountTotal
duringAlreadyValue
the 43rd
Paid
Fiscal Period

Naha, Okinawa

Replacement of interior fittings on the 8th and9th floors (office automation facilities, walls,
etc.)
Repair of rooftop waterproofing for lower
floors(2) Capital
Capital Expenditures
Period(2)
Expendituresduring
duringthe
the43rd43rdFiscal
FiscalPeriod

19.

The following are the capital expenditure amounts JPR invested in real estate and entrusted real estate during the 43rd fiscal period.
Among major capital expenditures, JPR conducted replacement of air conditioning units to maintain and enhance tenant satisfaction,
as well as renovation of common-use areas with the aim of attracting new tenants, among other works. In addition, aside from these
constructions, JPR conducted construction of 444 million yen (Note), which was appropriated as expenditures for repair andmaintenance.
Property Name

Location

Housing Design Center
Kobe

Kobe, Hyogo

Sompo Japan Sendai Bldg.

Sendai, Miyagi

MS Shibaura Bldg.

Minato-ku, Tokyo

Tokyo Tatemono Higashi
Shibuya Bldg.

Shibuya-ku, Tokyo

Kawaguchi Center Bldg.

Kawaguchi, Saitama

JPR Shinsaibashi Bldg.

Osaka, Osaka

14

Construction
Expenses(millions of yen)

Purpose

PeriodSecond phase of replacement of toilets

Jan. 2023–Jun. 2023

87

Oct. 2022–Mar. 2023

86Aug. 2022–Mar. 2023

65

Mar. 2023–Jun. 2023

43

Jun. 2022–Mar. 2023

43

Jan. 2023–Jun. 2023

42

Replacement of generators for
emergency
Second phase of reinforcement ofelevators
First phase of reinforcement of elevators
First phase of replacement of lighting
equipment with LED lamps
Repair of exterior walls

20

Asset Management ReportJapan Prime Realty Investment Corporation

Shinjuku Center Bldg.

Shinjuku-ku, Tokyo

Sencity Bldg.

Chiba, Chiba

Sencity Bldg.

Chiba, Chiba

JPR Omiya Bldg.

Saitama, Saitama

Fifth phase of replacement of piping
Jan. 2023–Mar. 2023
equipment
Replacement of power receiving
Jan. 2023–Mar. 2023
equipment
Reinforcement of elevators (West No.
Apr. 2023–Jun. 2023
24)
Separation of the 8th floor
Jan. 2023–Mar. 2023
Replacement of air-conditioning units, repair of common areas,
replacement of lighting equipment with LED lamps, etc.
Total

Other Capital Expenditures

31
36
30
30
954
1,453

(Note) Expenditures for repair and maintenance included 10 million yen of construction management fees paid to construction management companies as well as theamounts for repair and maintenance constructions themselves.

(3) Amounts
Amounts Reserved
andMaintenance
Plans
(3)
Reservedfor
forLong-Term
Long-TermRepairs
Repairs
andMaintenance
Plans

20.

JPR has deposited the following amounts from the redundant cash flow (including one accompanying internal reserve of profits) suchas depreciation in order to conduct large-scale repairs and maintenance work, based on medium- to long-term repairs and maintenanceplans for individual properties.
Operation Period
Balance of deposits at
beginning of current period
Deposits during the period
Amounts used from
deposits during the period
Deposits carried forward to
the next period(Millions of yen)

39th Fiscal Period(Jan. 1, 2021 Jun. 30, 2021)

40th Fiscal Period(Jul. 1, 2021 Dec. 31, 2021)

41st Fiscal Period(Jan. 1, 2022 Jun. 30, 2022)

42nd Fiscal Period(Jul. 1, 2022 Dec. 31, 2022)

43rd Fiscal Period(Jan. 1, 2023 Jun. 30, 2023)

1,421

1,506

1,610

1,758

1,729

859

1,008

802

1,024

927

774

904

654

1,053

898

1,506

1,610

1,758

1,729

1,758

21

15

Asset Management ReportJapan Prime Realty Investment Corporation

5. Expenses
and
5. Expenses
andLiabilities
Liabilities
Details
ExpensesRelated
Relatedto
toManagement
Management(1) (1)
Detailsof ofExpenses1.

42nd Fiscal Period(Jul. 1, 2022 - Dec. 31, 2022)(Thousands of yen)

792,966
246,14243rd Fiscal Period(Jan. 1, 2023 - Jun. 30, 2023)
758,548244,392

208,800
338,023

207,942306,213(b) Administrative Service and Asset Custody Fees

84,64884,487(c) Directors' Compensation(d) Trust Fees

6,300
15,6086,300
15,845(e) Other Operating Expenses
Total

156,754
1,056,277

138,111
1,003,292

Item(a) Asset Management Fees (Note)
Management fee 1
Management fee 2Management fee 3(Note) Aside from the amounts of the asset management fees entered above, fees for asset management of the acquired properties (42nd fiscal period: 16,600 thousand yen,
43rd fiscal period: 61,300 thousand yen) have been paid and included in the book value of each property, and fees for asset management of the sold property (42ndfiscal period: 47,600 thousand yen, 43rd fiscal period: 20,845 thousand yen) have been paid and deducted from gain on sale of each property.

StatusLoans
Payable(2) (2)
Statusof of
Loans
Payable2.

As of June 30, 2023 JPR has the following loans payable.

Long-Term Loans Payable

ShortTerm
Loans
PayableCategory

16

Drawdown
Date

Balance asof Jan. 1,
2023(millionsof yen)

Mizuho Bank, Ltd.

Apr. 12, 2023

－

2,500

0.153

Jul. 5, 2023

Mizuho Bank, Ltd.

May 31, 2023

－

3,000

0.145

Jul. 5, 2023

－

5,500

Mizuho Bank, Ltd.

Jun. 27, 2014

5,000

－

1.178 Jun. 27, 2023

Mizuho Bank, Ltd.

Mar. 11, 2015

2,000

2,000

1.011 Mar. 11, 2024

Mizuho Bank, Ltd.

Mar. 24, 2015

2,000

2,000

1.056 Mar. 24, 2025

Mizuho Bank, Ltd.

Feb. 4, 2016

5,000

5,000

0.804 Feb. 4, 2026

Mizuho Bank, Ltd.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

Lender

Total

Balance as
Averageof Jun. 30, Interest Rate
Repayment
2023
(%)
Date
(millions(Note 1)of yen)
(Note 2)Repayment
MethodUseRemarks

Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed on maturityMizuho Bank, Ltd.

Dec. 5, 2019

2,000

2,000

0.646 Dec. 5, 2029

Mizuho Bank, Ltd.

Mar. 30, 2021

3,000

3,000

0.675 Mar. 31, 2031

Mizuho Bank, Ltd.

Mar. 30, 2022

2,400

2,400

0.675 Mar. 30, 2032

Mar. 30, 2022

600

600

0.675 Mar. 30, 2032

Mar. 30, 2022

1,000

1,000

Jun. 27, 2023

－

2,000

0.675 Mar. 30, 2032 Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed
0.401 Jun. 25, 2027
on maturity

Jun. 27, 2023

－

2,000

0.533 Dec. 27, 2028

Jun. 27, 2023

－

1,000

0.948 Jun. 27, 2033

MUFG Bank, Ltd.

Aug. 31, 2015

1,000

1,000

0.873 Aug. 31, 2023

MUFG Bank, Ltd.

Mar. 25, 2016

5,000

5,000

0.510 Mar. 25, 2024

MUFG Bank, Ltd.

Dec. 15, 2016

2,000

2,000

0.633 Dec. 13, 2024

MUFG Bank, Ltd.

Aug. 8, 2017

1,000

1,000

0.638 Aug. 8, 2025

MUFG Bank, Ltd.

Aug. 29, 2017

5,000

5,000

0.600 Aug. 29, 2025

Mizuho Bank, Ltd.
(Sustainability Loan)
Mizuho Bank, Ltd.
(Green Loan)
Mizuho Bank, Ltd.
(Green Loan)
Mizuho Bank, Ltd.
(Green Loan)
Mizuho Bank, Ltd.
(Green Loan)MUFG Bank, Ltd.

Sep. 5, 2017

3,000

3,000

0.593 Sep. 5, 2025

MUFG Bank, Ltd.

Jun. 25, 2021

4,000

4,000

0.450 Jun. 23, 2028

22

Asset Management Report

Long-Term Loans PayableCategory

Japan Prime Realty Investment Corporation

Drawdown
Date

Balance asof Jan. 1,
2023(millionsof yen)

Sumitomo Mitsui Banking Corporation

Dec. 5, 2019

1,000

1,000

0.245 Dec. 5, 2023

Sumitomo Mitsui Banking Corporation

Jun. 26, 2020

3,000

3,000

0.300 Jun. 26, 2025

Sumitomo Mitsui Banking Corporation

Mar. 30, 2021

2,000

2,000

0.450 Mar. 30, 2028

Sumitomo Mitsui Banking Corporation

Mar. 30, 2022

2,500

2,500

0.675 Mar. 30, 2032

Sumitomo Mitsui Banking Corporation

Mar. 30, 2022

2,000

2,000

0.600 Mar. 28, 2031

Sumitomo Mitsui Banking Corporation

Mar. 30, 2022

2,000

2,000

0.525 Mar. 29, 2030

Lender

Balance as
Averageof Jun. 30, Interest Rate
Repayment
2023
(%)
Date
(millions(Note 1)of yen)
(Note 2)Repayment
MethodUseRemarks

Sumitomo Mitsui Banking Corporation

Jun. 27, 2022

2,500

2,500

0.698 Jun. 27, 2029

Development Bank of Japan, Inc.

Mar. 24, 2015

2,000

2,000

1.056 Mar. 24, 2025

Development Bank of Japan, Inc.

Dec. 15, 2016

3,000

3,000

0.843 Jun. 14, 2027

Development Bank of Japan, Inc.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

Development Bank of Japan, Inc.

Jun. 27, 2019

2,100

2,100

0.572 Jun. 27, 2029

Development Bank of Japan, Inc.

Jun. 25, 2021

800

800

0.600 Jun. 25, 2030

Development Bank of Japan, Inc.

Dec. 3, 2021

2,000

2,000

0.600 Dec. 3, 2030

SBI Shinsei Bank, Limited

Dec. 5, 2014

2,000

2,000

1.134 Dec. 5, 2024

SBI Shinsei Bank, Limited

Dec. 15, 2016

1,000

1,000

0.843 Jun. 14, 2027

SBI Shinsei Bank, Limited

Apr. 5, 2019

5,000

5,000

0.673

SBI Shinsei Bank, Limited

Sep. 24, 2020

1,000

1,000

0.675 Sep. 24, 2030

SBI Shinsei Bank, Limited

Sep. 24, 2020

1,000

1,000

0.525 Sep. 25, 2028

Shinkin Central Bank

Dec. 5, 2018

3,000

3,000

0.663

Shinkin Central BankJun. 27, 2019

2,000

2,000

0.447 Dec. 27, 2027

Shinkin Central Bank

Dec. 14, 2021

2,000

2,000

0.525 Dec. 14, 2029

The Norinchukin Bank

Dec. 5, 2017

1,000

1,000

0.604

The Norinchukin Bank

Jun. 27, 2019

2,000

2,000

Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed 
0.405 Jun. 25, 2027
on maturity

The Norinchukin Bank

Dec. 24, 2020

2,000

2,000

0.525 Dec. 25, 2028

The Norinchukin Bank

Dec. 14, 2021

2,000

2,000

0.525 Dec. 14, 2029

Mizuho Trust & Banking Co., Ltd.

Feb. 4, 2020

3,000

3,000

0.586

Mizuho Trust & Banking Co., Ltd.

Mar. 30, 2020

2,000

2,000

0.606 Mar. 29, 2030

Mizuho Trust & Banking Co., Ltd.

Dec. 24, 2020

2,000

2,000

0.675 Dec. 24, 2030

Aozora Bank, Ltd.

Jul. 3, 2017

900

900

Aozora Bank, Ltd.

Aug. 25, 2017

1,000

1,000

0.574 Feb. 25, 2025

Aozora Bank, Ltd.

Aug. 25, 2017

1,000

1,000

0.534 Aug. 23, 2024

Aozora Bank, Ltd.

Aug. 30, 2018

2,000

2,000

0.553 Feb. 25, 2025

Aozora Bank, Ltd.

Sep. 24, 2020

500

500

0.525 Sep. 25, 2028

Aozora Bank, Ltd.

Apr. 5, 2022

1,000

1,000

0.525

Apr. 5, 2030

The Bank of Fukuoka, Ltd.

Oct. 9, 2015

2,000

2,000

0.816

Oct. 6, 2023

The Bank of Fukuoka, Ltd.

Jul. 7, 2016

2,000

2,000

0.480

Jul. 7, 2026

The Bank of Fukuoka, Ltd.

Sep. 24, 2019

1,000

1,000

0.554 Sep. 21, 2029

The Bank of Fukuoka, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

Meiji Yasuda Life Insurance Company

Feb. 5, 2015

1,000

1,000

1.042

Meiji Yasuda Life Insurance Company

Jun. 21, 2018

3,200

3,200

0.813 Jun. 21, 2028

Sumitomo Life Insurance Company

Oct. 11, 2016

2,000

2,000

0.453 Oct. 11, 2024

Sumitomo Life Insurance Company

Jul. 22, 2019

1,000

1,000

0.583 Jul. 20, 2029

Sumitomo Life Insurance Company

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

The Shinkumi Federation Bank

Aug. 5, 2022

4,000

4,000

0.358 Aug. 5, 2027

23

0.625

Apr. 5, 2029

Jun. 4, 2027

Jun. 5, 2025

Feb. 4, 2030

Jul. 3, 2025

Feb. 5, 2025

Asset Management Report

Long-Term Loans PayableCategory

Japan Prime Realty Investment Corporation

Drawdown
Date

Balance asof Jan. 1,
2023(millionsof yen)

The Nishi-Nippon City Bank, Ltd.

May 27, 2016

3,000

3,000

0.646 May 27, 2026

The Nishi-Nippon City Bank, Ltd.

Dec. 14, 2021

1,000

1,000

0.525 Dec. 14, 2029

Taiyo Life Insurance Company

Sep. 24, 2015

1,000

1,000

0.969 Sep. 24, 2024

Taiyo Life Insurance Company

Jun. 4, 2018

1,000

1,000

0.811

Taiyo Life Insurance Company

Dec. 25, 2020

1,000

1,000

0.675 Dec. 24, 2030

The Chugoku Bank, Ltd.

Oct. 9, 2015

2,000

2,000

0.816

The Chugoku Bank, Ltd.

Sep. 25, 2018

1,000

1,000

0.661 Mar. 25, 2026

The Yamaguchi Bank, Ltd.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

The Yamaguchi Bank, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

The Yamaguchi Bank, Ltd.

Mar. 30, 2022

1,000

1,000

0.675 Mar. 30, 2032

The Iyo Bank, Ltd.

Oct. 9, 2015

1,000

1,000

0.816

The Iyo Bank, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

Lender

Balance as
Averageof Jun. 30, Interest Rate
Repayment
2023
(%)
Date
(millions(Note 1)of yen)
(Note 2)Repayment
MethodUseRemarks

Jun. 5, 2028

Oct. 6, 2023

Oct. 6, 2023

The Kiyo Bank, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

The Kiyo Bank, Ltd.

Mar. 30, 2022

1,000

1,000

0.675 Mar. 30, 2032

Sompo Japan Insurance Inc.

Dec. 25, 2015

2,000

2,000

0.759 Dec. 25, 2023

Nippon Life Insurance Company

Nov. 22, 2019

2,000

2,000

0.225 Nov. 22, 2023

The Hachijuni Bank, Ltd.

Oct. 9, 2020

1,000

1,000

0.300

The Hachijuni Bank, Ltd.

Sep. 24, 2021

1,000

1,000

The Yamanashi Chuo Bank, Ltd.

Apr. 30, 2021

1,000

1,000

The Yamanashi Chuo Bank, Ltd.

Apr. 5, 2022

1,000

1,000

0.310 Sep. 24, 2026 Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed 0.600 Apr. 30, 2030
on maturity
0.600 Apr. 5, 2032

Resona Bank, Ltd.

Sep. 30, 2022

2,000

2,000

0.888 Sep. 30, 2031

NTT TC Leasing Co., Ltd.

May 31, 2018

1,000

－

0.408 May 31, 2023

Kansai Mirai Bank, Limited

Mar. 30, 2022

1,000

1,000

0.600 Mar. 30, 2032

The 77 Bank, Ltd.

May 31, 2018

1,000

－

0.408 May 31, 2023

Oct. 9, 2025

The 77 Bank, Ltd.

May 31, 2023

－

1,000

0.543 Nov. 30, 2028

Daishi Hokuetsu Bank, Ltd.

Nov. 21, 2022

1,000

1,000

0.566 Nov. 21, 2028

Daido Life Insurance Company

Dec. 27, 2018

1,000

1,000

0.316 Dec. 25, 2023

The Chiba Bank, Ltd.

Oct. 25, 2018

1,000

1,000

0.449 Oct. 25, 2023

Dec. 27, 2018

1,000

－

0.299 Jun. 27, 2023

Jun. 27, 2023

－

1,000

0.443 Dec. 27, 2027

The Hyakugo Bank, Ltd.

Oct. 25, 2018

1,000

1,000

0.582 Apr. 25, 2025

The Hiroshima Bank, Ltd.

Nov. 21, 2022

1,000

1,000

0.566 Nov. 21, 2028

Mitsui Sumitomo Insurance Company,
Limited

Oct. 4, 2019

1,000

1,000

0.310

Sumitomo Mitsui Trust Bank Limited

Mar. 25, 2016

1,000

1,000

0.691 Mar. 25, 2026

Bank of Kyoto, Ltd.

Mar. 30, 2022

500

500

0.600 Mar. 30, 2032



165,000

164,000

Tokio Marine & Nichido Fire InsuranceCo., Ltd.
Tokio Marine & Nichido Fire InsuranceCo., Ltd.

Total

Oct. 2, 2026









(Note 1) The average interest rates represent the weighted-averages during the fiscal period, and are rounded to the third decimal place. Furthermore, fees related to loanarrangement paid to the above lenders are not included.
(Note 2) Short-term loans payable are floating-rate loans payable. Long-term loans payable are fixed-rate loans payable.
(Note 3) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemption of
investment corporation bonds.

24

Asset Management ReportJapan Prime Realty Investment Corporation(3) Investment
Investment Corporation(3)
CorporationBonds
Bonds

3.

Details of JPR’s investment corporation bonds outstanding as of June 30, 2023 are as follows.
Name
Seventh Series ofInvestment Corporation Bonds
Eighteenth Series ofInvestment Corporation Bonds
Nineteenth Series ofInvestment Corporation Bonds
Twenty-first Series ofInvestment Corporation Bonds
Twenty-second Series ofInvestment Corporation Bonds
Twenty-third Series ofInvestment Corporation Bonds
Twenty-fourth Series ofInvestment Corporation Bonds(Green Bonds)
Twenty-fifth Series ofInvestment Corporation Bonds(Green Bonds)
Twenty-sixth Series ofInvestment Corporation Bonds
Twenty-seventh Series ofInvestment Corporation Bonds(Sustainability Bonds)
Twenty-eighth Series ofInvestment Corporation Bonds(Green Bonds)
Total

Issue Date

Balance as of
Balance as of
CouponRate
Jan. 1, 2023
Jun. 30, 2023(%)
(millions of yen) (millions of yen)

Maturity Date

Dec. 14, 2006

4,500

4,500

2.900

Dec. 14, 2026

May 31, 2013

2,000

－

1.460

May 31, 2023

Feb. 5, 2014

5,000

5,000

1.110

Feb. 5, 2024

Jul. 22, 2014

4,000

4,000

1.278

Jul. 22, 2026

Dec. 4, 2014

3,000

3,000

0.831

Dec. 4, 2024

May 31, 2018

3,000

3,000

0.550

May 31, 2028

Jul. 31, 2019

5,000

5,000

0.570

Jul. 31, 2029

Nov. 26, 2020

6,000

6,000

0.510

Nov. 26, 2030

Mar. 16, 2021

3,000

3,000

0.760

Mar. 14, 2036

Dec. 7, 2021

1,400

1,400

0.420

Dec. 5, 2031

Dec. 7, 2021

1,000

1,000

0.670

Dec. 5, 2036

37,90035,900

Redemption
MethodUse

Remarks

Bulletrepayment(Note 1)

(Note 2)

(Note 1) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemption of
investment corporation bonds.
(Note 2) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.

(4) Subscription
Subscription Rights(4)
RightstotoShares
Shares4.

Not applicable25

19

Asset Management ReportJapan Prime Realty Investment Corporation

6.
andSalesSales
during
43rd
FiscalPeriod6. Acquisitions
Acquisitions andduringthethe43rd
FiscalPeriod(1)
andSaleSaleofofRealEstateandAsset-Backed
Securities(1) Acquisition
Acquisition andReal
EstateandAsset-Backed
Securities

5.

Acquisition

Acquisition Date

AcquisitionPrice(millions ofyen)(Note)

Osaka Dojima Bldg.

January 11, 2023

2,460

－

－

－

－

－

－

FUNDES Tenjin
Nishidori

January 11, 2023

3,310

－

－

－

－

－

－

Ochanomizu Sola City

April 12, 2023

6,490

－

－

－

－

－

－

JPR Crest Takebashi
Bldg.

－

－

April 12, 2023

4,169

3,265

903

21

881

Total

－

12,260

－

4,169

3,265

903

21

881

Type of
Asset

Real Estate Name

Real estate
Real estate
Beneficiaryinterest
Beneficiaryinterest(Note)

Sale

Sale Date

Sale Price
Difference
Sale
Sale Profit
Book Value(A)(C)
Expense and Loss
(B)
(millions(A)-(B)(D)(C)-(D)(millionsof yen)(millions (millions (millionsof yen)(Note)
of yen)of yen)of yen)Values of Acquisition Price or Sale Price are amounts (transaction price indicated in the transaction contract, etc.) excluding expenses (such as real estate transaction
brokerage fees) required for acquisition or sale of the relevant real estate.

(2) Acquisition
Acquisition and
Other
Assets(2)
andSaleSaleofof
Other
Assets6.

JPR made no acquisition or sale of other assets in the 43rd fiscal period.

(3) Survey
Survey on
Assets,Etc.Etc.
(3)
onValues
ValuesofofSpecified
Specified
Assets,7.

1) Real estate, etc.
AcquisitionorType of Asset
Sale

Real Estate NameTransaction Date

Acquisition

Osaka Dojima Bldg.

January 11, 2023

Acquisition
Acquisition
Sale

Real estate
Real estate
Beneficiaryinterest
Beneficiaryinterest

FUNDES Tenjin
NishidoriOchanomizu SolaCity
JPR Crest Takebashi
Bldg.

January 11, 2023
April 12, 2023
April 12, 2023

Acquisition
Real Estate
Price or Sale
Appraisal Value
Price
Real Estate Appraiser
Appraisal Date(millions of yen)(millions of yen)
(Note 2)
(Note 1)
Japan Valuers Co.,
2,460
2,700
November 1, 2022
Ltd.
Japan Real Estate
3,310
3,590
November 1, 2022
Institute
JLL Morii Valuation
6,490
7,170
December 31, 2022
& Advisory K.K.
Daiwa Real Estate
4,169
3,790
December 31, 2022
Appraisal Co., Ltd.

(Note 1) Values of Acquisition Price or Sale Price are amounts (transaction price indicated in the transaction contract, etc.) excluding expenses (such as real estatetransaction brokerage fees) required for acquisition or sale of the relevant real estate.
(Note 2) The appraisal in the table above was conducted by applying to the “Real Estate Appraisal Standards, Specific Thesis Chapter 3: Appraisal on Prices of Real Estate
Subject to Securitization.”

20

26

Asset Management ReportJapan Prime Realty Investment Corporation(4) Transactions
Transactions with
Major
Shareholders(4)
withInterested
InterestedParties
Partiesand
and
Major
Shareholders

8.

1) Transaction Status(Thousands of yen)Transaction Amount, Etc.

Category

Purchase Amount, Etc.

Total

Sale Amount, Etc.
12,260,000

4,169,000

Breakdown of transactions with interested parties
Tokyo Tatemono Co., Ltd.
Total

5,770,000(47.1%)－(－%)

5,770,000(47.1%)－(－%)

2) Value of Fee Expenses
Category

Total Paid Fees
(A)

Property Management Fees (Note 2)

345,140

Outsourcing Expenses

707,113

Tenant Brokerage Fees

70,214

Breakdown of Transaction with Interested Parties andMajor Shareholders
Paid Party
Paid Amount (B)Tokyo Tatemono Co., Ltd.
223,975
Prime Place Co., Ltd.
22,896
Tokyo Tatemono Co., Ltd.
444,362
Prime Place Co., Ltd.
14,715
Tokyo Tatemono Co., Ltd.
18,157
Prime Place Co., Ltd.
1,500

(Thousands of yen)
Ratio to Total
Amount
(B/A)
64.9%
6.6%
62.8%
2.1%
25.9%
2.1%

(Note 1) Interested parties and major shareholders refer to the interested parties of the asset management company who has concluded an asset management agreement with
JPR and is regulated as designated in Article 123 of the Enforcement Order of the Act on Investment Trusts and Investment Corporations and article 26-1-27 of theregulation on management reports in regard to investment trusts and investment corporations of The Investment Trusts Association, Japan.
(Note 2) The property management fees indicated in the above table include construction management fees (total of 32,458 thousand yen) appropriated as assets and nothandled as expenses.
(Note 3) Aside from transactions indicated in the above table, JPR paid the following amounts for repairs, etc. conducted by below parties who are interested parties or
major shareholders during the 43rd fiscal period.
Tokyo Tatemono Co., Ltd.
Prime Place Co., Ltd.
Tokyo Real Estate Management Co., Ltd.
Shinjuku Center Building Management Co., Ltd.

571,204 thousand yen
66,617 thousand yen
306,461 thousand yen
30,355 thousand yen(5) Transactions with the Asset Management Company regarding
Concurrent
Work
Conducted
by theConcurrent
AssetWorkManagement
Company(5) Transactions
with the AssetManagement
Company regarding
Conducted by the AssetManagement Company
Tokyo Realty Investment Management, Inc., the asset management company of JPR, does not concurrently conduct any of the class 1
financial instruments transaction business, class 2 financial instruments transaction business, land and building transaction business,or real estate syndication business, and has no such transactions with JPR.

27

21

Asset Management ReportJapan Prime Realty Investment Corporation7.
ofAccounting
Accounting
7. Overview
Overview of(1) Assets,
Assets, Liabilities,
Profits
and
Loss
(1)
Liabilities,Principal,
Principal,andandProfits
and
Loss

9.

For assets, liabilities, principal and profits and loss, please refer to the Balance Sheet, Statement of Income and Retained Earnings,
Statement of Unitholders' Equity and Notes to Financial Statements as well as Distribution Information on later pages of this report.

(2) Changes
Changes inof ofDepreciation(2)
inCalculation
CalculationMethod
MethodDepreciation

10.

No change has been made.

(3) Changes
Changes inin Valuation(3)
Valuation Method
Methodof
ofRealRealEstate
EstateandandInfrastructure
InfrastructureAssets
Assets11.

No change has been made.

8. Overview of Self-Managed Investment Trust Beneficiary
8. Overview
of Self-Managed Investment Trust Beneficiary Certificates
Certificates(1) Acquisition
Acquisition
(1)

12.

Tokyo Realty Investment Management, Inc., the asset management company of JPR, acquired and holds JPR’s investment units as
indicated below.
Acquisition Date

Number of Units Acquired

Number of Units Disposed

Number of Units Held

September 14, 2001

40

–

40

January 22, 2002 (Note)

60

–

100

Accumulated Total

100

–

100

(Note) The acquisition was due to the investment unit split (2.5 units for one existing unit).

(2)
Held
(2) Units
Units Held13.

Number of Units Held at End
of Period

34th Fiscal Period(Jul. 1, 2018 – Dec. 31, 2018)35th Fiscal Period(Jan. 1, 2019 – Jun. 30, 2019)36th Fiscal Period(Jul. 1, 2019 – Dec. 31, 2019)37th Fiscal Period(Jan. 1, 2020 – Jun. 30, 2020)
38th Fiscal Period(Jul. 1, 2020 – Dec. 31, 2020)
39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)
40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)
41st Fiscal Period(Jan. 1, 2022 – Jun. 30, 2022)
42nd Fiscal Period(Jul. 1, 2022 – Dec. 31, 2022)
43rd Fiscal Period(Jan. 1, 2023 – Jun. 30, 2023)

Ratio to Total Units Issued
and Outstanding (%)

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

(Note) Total investment at end of period represents the acquisition price.

22

Total Investment at End of
Period (Note)(millions of yen)28

Asset Management ReportJapan Prime Realty Investment Corporation

9.
onCorporation
CorporationOwning
OwningForeignReal
Estate
9. Disclosure
Disclosure on
ForeignReal
EstateNot applicable

10. Disclosure on Real Estate Owned by Corporation
10. Disclosure
on Real Estate
Owned
by Corporation Owning Foreign Real Estate
Owning Foreign
RealEstateNot applicable11.
11. OtherOther(1) Notice
Notice(1)

14.

There are no major issues related to the execution and modification, etc. of major agreements approved at JPR’s Board of Directors meeting in the
43rd fiscal period.

(2) Other
Other
(2)

15.

Unless otherwise stated, monetary amounts are rounded down and percentage figures are rounded off to the nearest specified unit inthis Semi-Annual Report.

29

23

Financial Statements

Japan Prime Realty Investment Corporation

BalanceSheet
Sheet(1)(1)
Balance1.

(Thousands of yen)
End of 42nd Fiscal Period(Dec. 31, 2022)

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings
Accumulated depreciation

End of 43rd Fiscal Period(Jun.30 2023)

33,127,007
12,379,450
583,489
132,360－
39,60427,056,051
12,285,353
585,133
126,086
13,604
21,67046,261,911

40,087,899

69,506,736(23,785,420)

71,054,645(24,692,241)

45,721,315

46,362,404

Buildings in trust
Accumulated depreciation

96,194,049(38,559,767)

96,131,588(38,728,727)

Buildings in trust, net

57,634,282

57,402,861

94,101(38,968)

94,381(41,434)

Buildings, net

Structures
Accumulated depreciation

55,133

52,946Structures in trust
Accumulated depreciation
Structures in trust, net

128,272(81,897)
46,374130,848(82,311)48,537

Machinery and equipment
Accumulated depreciation

834,332(582,683)

851,609(599,522)

Structures, net

Machinery and equipment, net

251,649

252,087

Machinery and equipment in trust
Accumulated depreciation

1,996,314(1,544,705)

1,938,100(1,504,418)

451,608

433,681

217,792(119,029)

243,571(129,699)

Tools, furniture and fixtures, net

98,763

113,871

Tools, furniture and fixtures in trust
Accumulated depreciation

304,416(202,509)

311,209(208,610)

Machinery and equipment in trust, net
Tools, furniture and fixtures
Accumulated depreciation

101,906

Tools, furniture and fixtures in trust, net*1

Land
Land in trust
Construction in progress
Construction in progress in trust
Total property, plant and equipment
Intangible assets
Leasehold right
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Long-term prepaid expenses
Other
Total investments and other assets
Total noncurrent assets
Deferred assets
Investment corporation bond issuance costs
Investment unit issuance expenses
Total deferred assets
Total assets

30

140,959,190
202,608,096
9,960
41,045447,979,326

102,598*1

145,954,517
205,823,796
14,5083,750
456,565,560

11,801,831
2,463

11,801,831
14,817

11,804,294

11,816,648

88,860802,490
520,563710

88,860808,280
528,440710

1,412,623

1,426,290

461,196,244

469,808,500

165,429
31,861150,911
22,371

197,291

173,282

507,655,447

510,069,681

1

Financial Statements

Japan Prime Realty Investment Corporation(Thousands of yen)
End of 42nd Fiscal Period(Dec. 31, 2022)
Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of investment corporation bonds
Current portion of long-term loans payable
Accounts payable-otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities
Noncurrent liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Total noncurrent liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
Surplus
Voluntary reserve
Reserve for reduction entry
Total voluntary reserve
Unappropriated retained earnings
Total surplus
Total unitholders' equity*3

Total net assets

3,027,125－
2,000,000
21,000,000
1,082,817
90,561
605
499,038
2,821,057
3,274

2,658,042
5,500,000
5,000,000
20,000,000
978,420
84,966605
182,1612,808,557
2,138

30,524,479

37,214,891

35,900,000
144,000,000
10,185,789
13,441,294

30,900,000
144,000,000
10,641,493
13,338,894

203,527,083

198,880,387

234,051,563

236,095,279

261,751,240

261,751,240

3,376,470

4,118,301

3,376,470

4,118,301

8,476,171

8,104,860

11,852,642

12,223,161

273,603,883

273,974,402

273,603,883
507,655,447

Total liabilities and net assets

31

End of 43rd Fiscal Period(Jun.30 2023)*3273,974,402
510,069,681

Financial Statements

Japan Prime Realty Investment Corporation

StatementofofIncome
Income andand Retained(2)(2)
Statement
RetainedEarnings
Earnings

2.

(Thousands of yen)
42nd Fiscal Period(Jul. 1, 2022 – Dec. 31, 2022)

Operating revenue
Rent revenue-real estate
Gain on sale of real estate*1*2

17,392,648
1,347,213

43rd Fiscal Period(Jan. 1, 2023 – Jun. 30, 2023)*1*2

18,739,862

Total operating revenue
Operating expenses
Expenses related to rent business
Loss on exchange of real estate
Asset management fee
Administrative service and asset custody fees
Directors' compensation
Trust fees
Other operating expenses*1*3

8,199,445
210,929
792,966
84,6486,300
15,608
156,754

17,291,965
881,854
18,173,819*1

8,310,963－
758,548
84,4876,300
15,845
138,111

9,466,653

9,314,256

9,273,209

8,859,563

175
4,279
2,979
1,110

193
34,071
2,333
800

8,544

37,399529,585
50,670202,105
14,915
14,344284
811,905

525,041
50,494
197,730
14,5189,490
434
797,7108,469,847
8,469,847

8,099,253

Income taxes-current

605

605

Total income taxes

605

605

Net income

8,469,242

8,098,648

Retained earnings brought forward
Unappropriated retained earnings

6,929
8,476,171

6,212
8,104,860

Total operating expenses
Operating income
Non-operating income
Interest income
Income on settlement of management association accounts
Insurance income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing expenses
Interest expenses on investment corporation bonds
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance expenses
Other
Total non-operating expenses
Ordinary income
Income before income taxes

32

8,099,253

3

Financial Statements

Japan Prime Realty Investment Corporation

StatementofofChanges
Changes inin Unitholders’
Unitholders’ Equity(3)(3)
Statement
Equity3.

(Thousands of yen)
42nd Fiscal Period(Jul. 1, 2022 – Dec. 31, 2022)

43rd Fiscal Period(Jan. 1, 2023 – Jun. 30, 2023)

261,751,240

261,751,240

Unitholders' equity
Unitholders' capital
Balance at beginning of current period
Changes of items during the period
Total changes of items during the period
Balance at end of current period－－

261,751,240

261,751,240

2,546,454

3,376,470

830,016

815,777

830,016

741,830

3,376,470

4,118,301

8,614,933

8,476,171(830,016)(815,777)(7,777,988)
8,469,242(7,728,129)
8,098,648

Surplus
Voluntary reserve
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry(73,946)

Reversal of reserve for reduction entry
Total changes of items during the period
Balance at end of current period
Unappropriated retained earnings
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry

73,946

Reversal of reserve for reduction entry
Dividends from surplus
Net income(138,761)(371,311)

8,476,171

8,104,860

11,161,388

11,852,642－－

Dividends from surplus(7,777,988)(7,728,129)

Net income

8,469,242

8,098,648

Total changes of items during the period
Balance at end of current period
Total surplus
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry
Reversal of reserve for reduction entry－

691,254

370,518

11,852,642

12,223,161

272,912,629

273,603,883－－

Dividends from surplus(7,777,988)(7,728,129)

Net income

8,469,242

8,098,648

Total changes of items during the period
Balance at end of current period
Total unitholders' equity
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry
Reversal of reserve for reduction entry－

691,254

370,518

273,603,883

273,974,402

272,912,629

273,603,883－－

Dividends from surplus(7,777,988)(7,728,129)

Net income

8,469,242

8,098,648

Total changes of items during the period
Balance at end of current period
Total net assets
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry
Reversal of reserve for reduction entry－

Total changes of items during the period
Balance at end of current period

433691,254

370,518

273,603,883

273,974,402

Financial Statements

Japan Prime Realty Investment Corporation(4) Statement of Cash Distributions(4) Statement of Cash Distributions

4.

I.
II.
III.
IV.

Unappropriated retained earnings
Reversal of voluntary reserve
Reversal of reserve for reduction entry
Distribution amount(Distribution amount per unit)
Voluntary reserve
Provision of reserve for reduction entry

V.
Retained earnings carried forward
Method for calculating distribution amount

42nd Fiscal Period(Jul. 1, 2022 – Dec. 31, 2022)
8,476,171,884 yen

43rd Fiscal Period(Jan. 1, 2023 –Jun. 30, 2023)
8,104,860,437 yen

73,946,740 yen
7,728,129,500 yen(7,750 yen)－
7,578,552,800 yen(7,600 yen)

815,777,113 yen

520,804,313 yen

6,212,011 yen
Pursuant to the policy on cash distributions
provided in Article 30 (2) of the Articles ofIncorporation of JPR, the distribution amountshall be in excess of an amount equivalent to
90% of the “distributable income amount” asstipulated in Article 67-15 of the Act on
Special Measures Concerning Taxation, but nomore than the amount of earnings. Under suchpolicy, JPR decided to pay out distributions ofearnings of 7,728,129,500 yen, which is thelargest integral multiple of the total number ofinvestment units issued and outstanding(997,178 units), from the balance ofunappropriated retained earnings after adding
the reversal of reserve for reduction entry
pursuant to Article 66-2 of the Act on Special
Measures Concerning Taxation and deducting
the provision of reserve for reduction entry
pursuant to Article 65-7 of the Act on Special
Measures Concerning Taxation, while
minimizing the burden to unitholders incurredby accrual of corporate income tax, etc.
Furthermore, JPR shall not distribute cash inexcess of earnings as stipulated in Article 30(4) of the Articles of Incorporation.

5,503,324 yen
Pursuant to the policy on cash distributions
provided in Article 30 (2) of the Articles ofIncorporation of JPR, the distribution amountshall be in excess of an amount equivalent to
90% of the “distributable income amount” asstipulated in Article 67-15 of the Act on
Special Measures Concerning Taxation, but nomore than the amount of earnings. Under suchpolicy, JPR decided to pay out distributions ofearnings of 7,578,552,800 yen, which is thelargest integral multiple of the total number ofinvestment units issued and outstanding(997,178 units), from the balance ofunappropriated retained earnings after
deducting the provision of reserve for
reduction entry pursuant to Article 65-7 of the
Act on Special Measures Concerning
Taxation, while minimizing the burden tounitholders incurred by accrual of corporate
income tax, etc. Furthermore, JPR shall not
distribute cash in excess of earnings as
stipulated in Article 30 (4) of the Articles ofIncorporation.

34

5

Financial Statements

Japan Prime Realty Investment Corporation

StatementofofCash
CashFlows
Flows(5)(5)
Statement

5.

(Thousands of yen)
42nd Fiscal Period(Jul. 1, 2022 – Dec. 31, 2022)

43rd Fiscal Period(Jan. 1, 2023 – Jun. 30, 2023)

Income before income taxes

8,469,847

8,099,253

Depreciation and amortization

2,055,734

2,046,014

Difference related to exchange of noncurrent assets

1,121,208－

Amortization of investment corporation bond issuance costs

14,915

14,518

Amortization of investment unit issuance expenses

14,3449,490

Net cash provided by (used in) operating activities

Interest income

(175)

(193)

Interest expenses

731,690722,772

Decrease (increase) in operating accounts receivable(90,504)(1,643)

Decrease (increase) in consumption taxes receivable－(13,604)

Decrease (increase) in prepaid expenses
Increase (decrease) in operating accounts payable(4,704)79,2996,274
102,426

Increase (decrease) in accounts payable-other(10,899)(104,943)

Increase (decrease) in accrued consumption taxes(43,340)(316,877)

Increase (decrease) in advances received
Decrease in property, plant and equipment in trust due to sale

7,879

(12,500)

3,718,086

3,265,600

Other, net(179,814)(31,163)

Subtotal

15,883,569

13,785,422

Interest income received
Interest expenses paid

175

193

(727,716)(728,366)

(602)

(607)

15,155,425

13,056,642

Purchase of property, plant and equipment(590,345)(6,968,920)

Purchase of property, plant and equipment in trust
Purchase of intangible assets(648,384)(1,081)(7,399,017)(13,909)

Payments of lease and guarantee deposits(18,400)(5,790)

Repayments of tenant leasehold and security deposits(49,788)(169,936)

Income taxes (paid) refund
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities

Proceeds from tenant leasehold and security deposits

153,971625,641

Repayments of tenant leasehold and security deposits in trust(540,221)(636,540)

265,649

573,633(1,428,600)(13,994,840)

Proceeds from short-term loans payable－

5,500,000

Proceeds from long-term loans payable

8,000,000

7,000,000

Repayment of long-term loans payable(8,000,000)(8,000,000)

Proceeds from tenant leasehold and security deposits in trust
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities－(2,000,000)

Dividends paid

(7,777,592)(7,726,854)

Net cash provided by (used in) financing activities(7,777,592)(5,226,854)

Net increase (decrease) in cash and cash equivalents

5,949,232(6,165,052)

Cash and cash equivalents at beginning of current period

39,557,224

45,506,457

Redemption of investment corporation bonds*1

Cash and cash equivalents at end of current period

63545,506,457*1

39,341,405

Financial Statements

Japan Prime Realty Investment Corporation

Notes
Financial
Statements(6) (6)Notes
to to
Financial
Statements

6.

(Basis of Presenting Financial Statements)
Japan Prime Realty Investment Corporation (JPR) maintains its accounting records and prepares its financial statements in accordancewith accounting principles generally accepted in Japan (Japanese GAAP), including provisions set forth in the Financial Instruments
and Exchange Act of Japan, the Act on Investment Trusts and Investment Corporations (the Investment Trusts Act), the Companies Act
and the related regulations, which are different in certain respects as to the adoption and disclosure requirements of International
Financial Reporting Standards.
The accompanying financial statements are basically a translation of the audited financial statements of JPR, which were prepared inaccordance with Japanese GAAP and filed with the Kanto Local Finance Bureau. In preparing the accompanying financial statements,
certain reclassifications have been made to the financial statements issued domestically in order to present them in a format which ismore familiar to readers outside Japan. In addition, the notes to financial statements include information which might not be required
under Japanese GAAP but is presented herein as additional information.
JPR’s accounting periods end at the end of June and December.

(Significant Accounting Policies)
1. Standards and Method for Asset
Valuation

2. Depreciation/Amortization
Method for Noncurrent Assets

3. Accounting for Deferred Assets

4. Standards for Recognition of
Revenues and Expenses

5. Scope of Cash and Cash
Equivalents in the Statement of
Cash Flows
6. Other Significant Items
Fundamental to the Preparation of
Financial Statements

Investment securities
Other securities
Stocks and other securities with no market prices
Stocks and other securities with no market prices are stated at cost being determined by the moving averagemethod.
(1) Property and Equipment (including entrusted properties)
Depreciation is calculated using the straight-line method. The estimated useful lives of major property andequipment ranges are as follows:
Buildings ...................................... 3 - 65 years
Structures ................................... 10 - 35 years
Machinery and equipment ............. 3 - 17 years
Tools, furniture and fixtures .......... 3 - 20 years
Assets with purchase costs of 100,000 yen or more but less than 200,000 yen are depreciated over three years based on
the Corporation Tax Act.
(2) Intangible Assets
Intangible assets are amortized utilizing the straight-line method.
(3) Long-term Prepaid Expenses
Long-term prepaid expenses are amortized utilizing the straight-line method.
(1) Investment Corporation Bond Issuance Costs
Investment corporation bond issuance costs are amortized utilizing the straight-line method over the redemption
periods.
(2) Investment Unit Issuance Expenses
Investment unit issuance expenses are amortized utilizing the straight-line method over three years.
(1) Revenue Recognition
The details of main performance obligations concerning revenue generated from contracts with customers of JPR
and the ordinary time to fulfil said performance obligations (ordinary time to recognize revenue) are as follows.
a. Sale of real estate
For the proceeds from sale of real estate, JPR recognizes revenue when the purchaser who is a customer obtains
control of the relevant real estate as a result of JPR fulfilling its delivery obligations stipulated in the transaction
contract of the real estate.
b. Utilities income
JPR recognizes utilities income upon the supply of electricity and water, etc. to the lessee who is a customer
based on the lease agreement of real estate and details of agreements incidental to it. Of the utilities income,in the case that JPR deems itself to be an agent, the net amount obtained by deducting the amount it pays toother parties from the amount it receives as charges for electricity and gas, etc. supplied by the said otherparties is recognized as revenue.
(2) Accounting Treatment of Taxes on Property and Equipment
In connection with property taxes, city planning taxes and depreciated asset taxes (the “property taxes”), JPR
uses the method of charging the corresponding amounts of assessed taxes to the current fiscal period as expenses
related to rent business.
Furthermore, JPR capitalized an amount equivalent to the property taxes paid to the sellers during the first fiscal
period as a part of the purchase cost, not as expenses, in connection with the acquisition of real estate or entrusted
beneficiary interests in real estate as entrusted property. Taxes on property and equipment capitalized amounted
to 613 thousand yen for the fiscal period ended December 31, 2022. Taxes on property and equipment capitalized
amounted to 38,073 thousand yen for the fiscal period ended June 30, 2023.
Cash and cash equivalents in the Statement of Cash Flows include the following items:(1) Cash on hand and cash in trust(2) Deposits placed with banks and deposits in trust that can be withdrawn at any time(3) Short-term investments that are readily convertible to cash and have insignificant risk of price fluctuations andhave original maturities of three months or less from the acquisition date.
Accounting Policies on Trust Beneficiary Interests in Real Estate as Property in Trust
Regarding trust beneficiary interests in real estate, all asset and liability accounts of entrusted properties as well
as all revenue and expense accounts generated by the property in trust are recorded in relevant accounts on the
Balance Sheet and Statement of Income and Retained Earnings.
Furthermore, the following material accounts are separately presented in the Balance Sheet for properties in trust
recorded in relevant accounts.
a. Cash and deposits in trustb. Buildings in trust, structures in trust, machinery and equipment in trust, tools, furniture and fixtures in trust,land in trust and construction in progress in trustc. Tenant leasehold and security deposits in trust

36

7

Financial Statements

Japan Prime Realty Investment Corporation(Notes to Balance Sheet)*1. Reduction Entry of Property, Plant and Equipment Acquired through Exchange(Thousands of yen)
End of 42nd Fiscal Period(as of December 31, 2022)

End of 43rd Fiscal Period(as of June 30, 2023)

Land

1,537,018

1,537,018

Total

1,537,018

1,537,018

2. Balance of Unused Commitment LineJPR has executed a commitment line agreement with its main lending financial institutions primarily to minimize refinancing risks
and enhance financial stability.
(Thousands of yen)
End of 42nd Fiscal Period(as of December 31, 2022)
Credit limit

End of 43rd Fiscal Period(as of June 30, 2023)
24,000,000

Outstanding debts at end of period
Unused commitment line at end of period

24,000,000－－

24,000,000

24,000,000*3 Minimum Total Unitholders’ Equity Designated in Article 67- 4 in the Act on Investment Trusts and Investment Corporations(Thousands of yen)
End of 42nd Fiscal Period(as of December 31, 2022)

End of 43rd Fiscal Period(as of June 30, 2023)
50,000850,00037

Financial Statements

Japan Prime Realty Investment Corporation(Notes to Statement of Income and Retained Earnings)*1. Breakdown of Rent Revenue-Real Estate and Expenses Related to Rent Business(Thousands of yen)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

A. Rent Revenue-Real Estate
Rent Revenue
Rents
Land rents

12,547,291
1,802,000

12,680,008
1,801,750

Common charges

1,283,973

1,268,237

Parking fees

286,561

284,154

Advertising fees

37,15238,289Antenna usage feesOther29,90245,24028,62545,221

16,032,122

16,146,287

Incidental rent income

1,006,164

1,001,894

Time-based parking fees
Cancellation charges

14,19282,368

14,58817,496

Income equivalent to expenses for restoration
to original condition

182,839

59,489Other miscellaneous income

74,96052,209Subtotal
Other rental revenues

Subtotal
Total rent revenue-real estate

1,360,526

1,145,678

16,363,416,363,49494005,870
17,392,648

16,363,416,363,49494005,870
17,291,965

B. Expenses Related to Rent BusinessOutsourcing expenses

703,637

707,113

Utilities expenses

1,301,145

1,285,235

Property and other taxes

2,507,086

2,594,259

Casualty insurance

30,02829,754

Repairs and maintenance432,326

433,688

Property management fees
Management association accounts

306,930
643,099

312,682
637,968

2,055,273

2,044,640

219,918

265,620

8,199,445

8,310,963

9,193,203

8,981,002

Depreciation
Other
Total expenses related to rent business
C. Profits for Rent Business(A-B)*2. Breakdown of Gain on Sale of Real Estate, etc.
(Thousands of yen)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)
JPR Umeda Loft Bldg. (30.0% co-ownership interest)
Proceeds from sale of real estate

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

5,250,000－－

Other expenses related to sale

3,718,086
184,700

Gain on sale of real estate

1,347,213－

Proceeds from sale of real estate－

4,169,000

Cost of sale of real estate－

3,265,600

Other expenses related to sale－

21,545Gain on sale of real estate－

881,854

Cost of sale of real estate－

JPR Crest Takebashi Bldg.

38

9

Financial Statements

Japan Prime Realty Investment Corporation*3. Breakdown of Loss on Exchange of Real Estate(Thousands of yen)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

Gotanda First Bldg.

Consideration for transfer of real estate
Cost of transfer of real estate
Other expenses related to transfer
Reduction of noncurrent assets

4,270,000－

2,921,061－

22,850－1,537,018－

210,929－－

42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

Loss on exchange of real estate(Notes to Statement of Changes in Unitholders’ Equity)

Total number of authorized units and number of units outstanding
Total number of authorized units
Number of units outstanding

5,000,000 units

5,000,000 units

997,178 units

997,178 units(Notes to Statement of Cash Flows)*1. Reconciliation of the Amounts of the Cash and Cash Equivalents at End of Period in the Statement of Cash Flows with theAmounts of the Corresponding Accounts on the Balance Sheet(Thousands of yen)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

Cash and deposits

33,127,007

27,056,051

Cash and deposits in trust

12,379,450

12,285,353

Cash and cash equivalents

45,506,457

39,341,405(Leases)
Future minimum lease payments to be received under non-cancelable operating leases(Thousands of yen)
42nd Fiscal Period(as of December 31, 2022)

43rd Fiscal Period(as of June 30, 2023)

Due within one year

6,035,590

6,267,262

Due after one year

15,698,580

16,381,055

Total

21,734,171

22,648,317(Financial Instruments)
1. Matters Concerning Status of Financial Instruments(1) Policy for Financial Instruments
In an aim to proactively expand asset size and maintain stable cash distributions to unitholders, JPR adopts the asset management
policy of paying heed to efficiently combining the procurement of long-term funds that are stable and the procurement of short-term
funds that emphasize flexibility.
There may be cases where JPR will engage in derivative transactions, but such will be limited to hedging for interest rate fluctuation
risk and other hedging purposes. Please note that JPR is not engaged in derivative transactions at present.

10

39

Financial Statements

Japan Prime Realty Investment Corporation(2) Description of Financial Instruments and Associated Risks, and Risk Management Structure
Tokyo Realty Investment Management, Inc. (TRIM), the asset management company of JPR, strives for risk management bycomplying with the JPR Asset Management Guidelines and other rules and regulations. The following outlines the description ofindividual financial instruments and the associated risks, and the risk management.
Deposits are exposed to risks of bankruptcy of the financial institutions holding the deposits and other credit risks, but the risks aremanaged through such measures as setting a minimum credit rating for the financial institutions holding the deposits.
Loans payable and investment corporation bonds are exposed to liquidity risks at the time of repayment/redemption, but the liquidity
risks are managed through such measures as procuring funds from the capital market by increasing capital, executing a commitmentline agreement with the main lending financial institutions, and also having statements of cash receipts and disbursements preparedby the financial division.
(3) Supplementary Explanation on Matters Concerning Fair Value, etc. of Financial Instruments
Certain assumptions are used in calculating the fair value of financial instruments, and there can be cases where the values may vary
based on different assumptions.
2. Matters Concerning Fair Value, etc. of Financial Instruments
The following are the book values and fair values as of December 31, 2022 of financial instruments, and the difference between theseamounts. Furthermore, notes on “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are omitted asthese are settled with cash and within a short period of time and thus the book value approximates the fair value. Notes on“Investment securities,” “Tenant leasehold and security deposits” and “Tenant leasehold and security deposits in trust” are also
omitted as they lack materiality.
(Thousands of yen)Book Value(Note 1)

Fair Value(Note 1)

Difference(1)

Current portion of investment corporation bonds(2,000,000)(2,009,200)

9,200

(2)

Current portion of long-term loans payable(21,000,000)(21,063,847)

63,847(3)

Investment corporation bonds(35,900,000)(35,526,389)-373,610(4)Long-term loans payable(144,000,000)(141,695,800)-2,304,199

The following are the book values and fair values as of June 30, 2023 of financial instruments, and the difference between these amounts.
Furthermore, notes on “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are omitted as these are settledwith cash and within a short period of time and thus the book value approximates the fair value. Notes on “Investment securities,”“Tenant leasehold and security deposits” and “Tenant leasehold and security deposits in trust” are also omitted as they lack materiality.
(Thousands of yen)Book Value(Note 1)

Fair Value(Note 1)

Difference(1)

Current portion of investment corporation bonds(5,000,000)(5,051,181)

51,181(2)

Current portion of long-term loans payable(20,000,000)(20,045,897)

45,897(3)

Investment corporation bonds(30,900,000)(30,832,853)-67,146(4)

Long-term loans payable(144,000,000)(144,141,089)

141,089(Note 1) Liabilities are shown in parentheses.
(Note 2) Method of calculation of fair value of financial instruments(1) Current portion of investment corporation bonds and (3) Investment corporation bonds
Of the fair value of these financial instruments, those with market price are measured based on market price and those with no market price are calculated inaccordance with (2) and (4) below.
(2) Current portion of long-term loans payable and (4) Long-term loans payable
The fair value of these financial instruments is calculated based on the discounted cash flow method under which the total amount of principal and interests are
discounted by the rate assumed as being applicable in the event of a new drawdown whose term is corresponding to the remaining loan term.

40

11Financial Statements

Japan Prime Realty Investment Corporation(Note 3) Amount of repayment of long-term loans payable or redemption of investment corporation bonds scheduled to be due subsequent to the 42nd fiscal period end(December 31, 2022)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due afterThree Years
through Four
Years

Investment corporation bonds

2,000,000

8,000,000－

8,500,000－

19,400,000

Long-term loans payable

21,000,000

15,000,000

23,900,000

14,000,000

18,000,000

73,100,000

Due after FourYears throughFive Years

Due after Five
Years

Amount of repayment of long-term loans payable or redemption of investment corporation bonds scheduled to be due subsequent to the 43rd fiscal period end(June 30, 2023)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due afterThree Years
through Four
Years

Investment corporation bonds

5,000,000

3,000,000－

8,500,000

3,000,000

16,400,000

Long-term loans payable

20,000,000

21,000,000

20,900,000

15,000,000

20,200,000

66,900,000

Due after FourYears throughFive Years

Due after Five
Years

(Securities)
42nd fiscal period (as of December 31, 2022)
Not applicable
43rd fiscal period (as of June 30, 2023)
Not applicable(Derivative Transactions)42nd fiscal period (as of December 31, 2022)
Not applicable as JPR entered into no derivative transactions
43rd fiscal period (as of June 30, 2023)
Not applicable as JPR entered into no derivative transactions(Retirement Benefits)
42nd fiscal period (as of December 31, 2022)
Not applicable as JPR does not have any retirement benefit plans
43rd fiscal period (as of June 30, 2023)
Not applicable as JPR does not have any retirement benefit plans(Tax Effect Accounting)
1. Breakdown of Main Items that Caused Differences between the Effective Statutory Tax Rate and the Effective Tax Rate after
Applying Tax Effect Accounting
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

31.46%

31.46%

Deductible cash distributions(28.70%)(29.44%)Other(2.75%)(2.01%)

Effective tax rate after applying tax effect accounting

0.01%

0.01%

Effective statutory tax rate
(Adjustment)(Equity Method Income and Retained Earnings)
42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable as JPR does not have any affiliated companies
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable as JPR does not have any affiliated companies

1241

Financial Statements

Japan Prime Realty Investment Corporation(Transactions with Related Parties)
1. Parent Company and Major Corporation Unitholders
42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable
2. Affiliated Companies
42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable
3. Sister Companies
42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable
4. Directors and Major Individual Unitholders
42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable(Asset Retirement Obligations)42nd fiscal period (July 1, 2022 – December 31, 2022)
Not applicable
43rd fiscal period (January 1, 2023 – June 30, 2023)
Not applicable(Segment Information)[Segment Information]
Disclosure is omitted as JPR is comprised of a single operating segment engaged in the property rent business.
[Related Information]
42nd fiscal period (July 1, 2022 – December 31, 2022)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service unit are in excess of 90% of operating
revenue on the Statement of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from domestic external customers are in excess of 90% of total revenues on the Statementof Income and Retained Earnings.
(2) Property, plant and equipment
Disclosure is omitted as the amount of JPR’s property, plant and equipment located in Japan is in excess of 90% of total
property, plant and equipment on the Balance Sheet.
3. Information about Major Customers
Disclosure is omitted as sales to any single external customer account for less than 10% of the operating revenue on the Statementof Income and Retained Earnings.

42

13

Financial Statements

Japan Prime Realty Investment Corporation

43rd fiscal period (January 1, 2023 – June 30, 2023)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service unit are in excess of 90% of operating
revenue on the Statement of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from domestic external customers are in excess of 90% of total revenues on the Statementof Income and Retained Earnings.
(2) Property, plant and equipment
Disclosure is omitted as the amount of JPR’s property, plant and equipment located in Japan is in excess of 90% of total
property, plant and equipment on the Balance Sheet.
3. Information about Major Customers
Disclosure is omitted as sales to any single external customer account for less than 10% of the operating revenue on the Statementof Income and Retained Earnings.

(Investment and Rental Properties)
JPR owns office properties (urban commercial facilities), retail properties (urban retail properties) and urban multi-use facilities forleasing in Tokyo and other regions. The following is the book value on the Balance Sheet, amount of increase (decrease) during theperiod and fair value of these investment and rental properties.
(Thousands of yen)

42nd Fiscal Period(July 1, 2022 – December 31, 2022)

Book Value on the Balance Sheet
Balance at Beginning of Period

465,129,001

Amount of Increase (Decrease) during the Period
Balance at End of Current Period
Fair Value at End of Period

43rd Fiscal Period(January 1, 2023 – June 30, 2023)
459,781,704(5,347,296)

8,586,188459,781,704

468,367,893

587,035,000

592,098,000(Note 1) The book value on the Balance Sheet is the cost of acquisition less accumulated depreciation.
(Note 2) For the 42nd fiscal period, the amount of increase is primarily attributable to the additional acquisition of Shinjuku Center Bldg. (1,838,124 thousand yen), and theamount of decrease is primarily attributable to the sale of Gotanda First Bldg. (2,921,061 thousand yen), the sale of JPR Umeda Loft Bldg. (30.0% co-ownershipinterest) (3,718,086 thousand yen) and depreciation (2,055,273 thousand yen). For the 43rd fiscal period, the amount of increase is primarily attributable to theacquisition of Osaka Dojima Bldg. (2,510,474 thousand yen), the acquisition of FUNDES Tenjin Nishidori (3,355,432 thousand yen) and the acquisition of
Ochanomizu Sola City (6,538,208 thousand yen), and the amount of decrease is primarily attributable to the sale of JPR Crest Takebashi Bldg. (3,265,600 thousandyen) and depreciation (2,044,640 thousand yen).
(Note 3) The fair value at end of the current period is the appraisal value or survey value as appraised by an outside real estate appraiser.

The income (loss) in the 42nd and 43rd fiscal periods for investment and rental properties is as presented in the “Notes to Statementof Income and Retained Earnings.”(Revenue Recognition)
42nd fiscal period (July 1, 2022 – December 31, 2022)
Breakdown information on revenue from contracts with customers

Sale of real estate(Thousands of yen)

Revenue from Contracts with Customers(Note 1)
9,520,000

Utilities income (Note 3)

Sales to External Customers(Note 2)
1,347,213

1,006,164

1,006,164

Others－16,386,483

Total

10,526,164

18,739,862(Note 1) Rent revenue subject to the “Accounting Standard for Lease Transactions” (ASBJ Statement No.13) are excluded from “Revenue from contracts with customers”
as such revenue is out of the scope of Accounting Standard for Revenue Recognition. Revenue from contracts with customers mainly represents proceeds fromsale of real estate and utilities income.
(Note 2) As sale of real estate is recorded as gain or loss on sale of real estate, etc. in the Statement of Income and Retained Earnings, the amount obtained by deducting
cost of sale of real estate and other expenses related to sale from proceeds from sale of real estate is indicated for sales to external customers. Furthermore, as JPR
records gain on sale of real estate for operating revenue while recording loss on sale of real estate for operating expenses, the table above indicates the amount ofgain on sale of real estate only.
(Note 3) Utilities income indicates the amount recorded as revenue upon the supply of electricity and water, etc. to the lessee who is a customer based on the lease agreementof real estate and agreements incidental to it.

1443Financial Statements

Japan Prime Realty Investment Corporation

43rd fiscal period (January 1, 2023 – June 30, 2023)
Breakdown information on revenue from contracts with customers

Sale of real estate(Thousands of yen)

Revenue from Contracts with Customers(Note 1)
4,169,000

Sales to External Customers(Note 2)881,854

Utilities income (Note 3)

1,001,894

1,001,894

Others－5,170,894

16,290,071
18,173,819

Total(Note 1) Rent revenue subject to the “Accounting Standard for Lease Transactions” (ASBJ Statement No.13) is excluded from “Revenue from contracts with customers” assuch revenue is out of the scope of Accounting Standard for Revenue Recognition. Revenue from contracts with customers mainly represents proceeds from saleof real estate and utilities income.
(Note 2) As sale of real estate is recorded as gain or loss on sale of real estate, etc. in the Statement of Income and Retained Earnings, the amount obtained by deducting
cost of sale of real estate and other expenses related to sale from proceeds from sale of real estate is indicated for sales to external customers. Furthermore, as JPR
records gain on sale of real estate in operating revenue while recording loss on sale of real estate in operating expenses, the table above indicates the amount ofgain on sale of real estate only.
(Note 3) Utilities income indicates the amount recorded as revenue upon the supply of electricity and water, etc. to the lessee who is a customer based on the lease agreementof real estate and agreements incidental to it.

(Per Unit Information)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

274,378 yen

274,749 yen

8,493 yen

8,121 yen

Total net assets per unit
Net income per unit

(Note 1) Net income per unit is calculated by dividing net income by the weighted-average number of units outstanding during the current fiscal period. Diluted net income
per unit has not been presented since no subscription rights to shares are outstanding.
(Note 2) Net income per unit was calculated based on the following data:

Net income (thousands of yen)

42nd Fiscal Period(July 1, 2022 – December 31, 2022)
8,469,242

Amounts not attributable to ordinary unitholders (thousands of yen)
Net income attributable to ordinary investment units (thousands of yen)
Average number of units during the fiscal period

43rd Fiscal Period(January 1, 2023 – June 30, 2023)
8,098,648－－

8,469,242

8,098,648

997,178 units

997,178 units(Subsequent Events)
Not applicable.

44

15

Financial Statements

Japan Prime Realty Investment Corporation

DetailedSchedules
Schedules(7)(7)
Detailed7.1) Schedule of Securities
a. Stock

Issuer Name

Number of
SharesUnit Price(thousands ofyen)

Amount(thousandsof yen)Unit Price(thousandsof yen)Amount(thousands ofyen)Profit andLoss from
Valuation(thousands ofyen)

KMO Corporation

1,666

50

83,74050

83,740

－

－

Total

1,666

－

83,740－83,740－－Acquisition Price (Note 1)

Appraisal Value (Note 2)

Remarks(Note 1) The acquisition price indicates the amount that includes the expenses required for the acquisition.
(Note 2) The appraisal value indicates the book value.

b. Other securities
Type of Asset

Issuer Name

Claim for refundof funds

Knowledge Capital,a general
incorporated
association

Book Value(thousandsof yen)AccruedInterest(thousandsof yen)Prepaidinterest
accrued(thousands ofyen)

Appraisal
Value(thousands ofyen) (Note)

Profit andLoss from
Valuation(thousands of
yen)

－

5,120

－

－

5,120

－

－

－

5,120

－

－

5,120

－

－

Total
Face
Value

Total
(Note) The appraisal value indicates the book value.

2) Status of Contract Amounts, etc. and Fair Value of Derivative Transactions and Forward Exchange Transactions
Not applicable

1645

RemarksFinancial Statements

Japan Prime Realty Investment Corporation

3) Schedule of Assets Related to Real Estate

Asset TypeAccumulated Depreciation
Balance as of
Increase during Decrease during Balance as ofDepreciation
January 1,
Or Accumulated
the Period
the Period
June 30, 2023
during the2023
Amortization(thousands of(thousands of (thousands ofPeriod(thousands of(thousands of
yen)
yen)
yen)
(thousands of
yen)
yen)
yen)

Net Balance as ofJune 30, 2023
(thousands of yen)

Current Assets

－

－

－

－

－

－

－

Property, plantand equipment(Real estate)
Buildings

69,506,736

1,547,909－

71,054,645

24,692,241

906,820

46,362,404

94,101

280－

94,381

41,434

2,466

52,946

834,332

17,276－851,609599,522

16,839252,087

217,792

25,778－

243,571

129,699

10,670113,871

140,959,190

4,995,327－

145,954,517－－

145,954,517

Structures
Machinery andequipment
Tools,
furniture andfixtures
Land
Constructionin progress
Subtotal(Beneficiaryinterests in trust)Buildings in
trust
Structures intrust
Machineryandequipment in
trust
Tools,
furniture andfixtures intrust
Land in trust

9,960

5,586

1,037

14,508－－14,508211,622,113

6,592,158

1,037

218,213,234

25,462,898

936,797

192,750,335

96,194,049

1,817,204

1,879,666

96,131,588

38,728,727

1,067,752

57,402,861

128,272

4,343

1,767

130,848

82,311

2,180

48,537

1,996,314

20,83979,053

1,938,100

1,504,418

27,059433,681

304,416

12,316

5,523

311,209

208,610

10,804

102,598

202,608,096

5,487,899

2,272,200

205,823,796－－

205,823,796

41,0453,750

41,045

3,750

－

－

3,750

Constructionin progress intrust
Subtotal

301,272,194

7,346,353

4,279,255

304,339,293

40,524,067

1,107,796

263,815,225

Total

512,894,308

13,938,512

4,280,292

522,552,527

65,986,966

2,044,593

456,565,560

11,801,831－－

11,801,831－－

11,801,831

6,465

13,909285

20,089

5,272

1,420

14,817

11,808,296

13,909285

11,821,920

5,272

1,420

11,816,648

Remarks

Propertyacquisition

Intangible Assets
Leasehold
right
Other
Total

(Note 1) The “Increase during the Period” is due to property acquisition and construction works, etc.
(Note 2) The “Decrease during the Period” is due to the transfer to relevant accounts as a result of construction completion for construction in progress and construction inprogress in trust, and due to property sale, etc. for buildings in trust, structures in trust, machinery and equipment in trust, tools, furniture and fixtures in trust and landin trust.

4) Schedule of Other Specified Assets
VolumeUnit Price(thousandsof yen)Amount(thousandsof yen)Unit Price(thousandsof yen)Amount(thousands ofyen)Profit andLoss from
Valuation(thousands of
yen)

1

－

710

－

710

－

－

1

－

710

－

710

－

－

Book Value
Type of Asset

Issuer Name

Claim for refund of funds

GRAND FRONTOSAKA TMO,
a general incorporated
association

Total

Appraisal Value (Note)

Remarks(Note) The appraisal value indicates the book value.

46

17Financial Statements

Japan Prime Realty Investment Corporation

5) Schedule of Investment Corporation Bonds

Decrease
Balance as ofduring theJanuary 1, 2023
Period(thousands of(thousands of
yen)
yen)

Balance as of
CouponJune 30, 2023
Rate
Maturity Date(thousands of
(%)
yen)

Name

Issue Date

Seventh Series ofInvestment Corporation
Bonds (Note 1)

Dec. 14, 2006

4,500,000－

4,500,000

2.900

Dec. 14, 2026

Eighteenth Series ofInvestment Corporation
Bonds (Note 1)

May 31, 2013

2,000,000

2,000,000

－

1.460

May 31, 2023

Nineteenth Series ofInvestment Corporation
Bonds (Note 1)

Feb. 5, 2014

5,000,000－

5,000,000

1.110

Feb. 5, 2024

Twenty-first Series ofInvestment Corporation
Bonds (Note 1)

Jul. 22, 2014

4,000,000－

4,000,000

1.278

Jul. 22, 2026

Twenty-second Series ofInvestment Corporation
Bonds (Note 1)

Dec. 4, 2014

3,000,000－

3,000,000

0.831

Dec. 4, 2024

Twenty-third Series ofInvestment Corporation
Bonds (Note 1)

May 31, 2018

3,000,000－

3,000,000

0.550

May 31, 2028

Twenty-fourth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Jul. 31, 2019

5,000,000－

5,000,000

0.570

Jul. 31, 2029

Twenty-fifth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Nov. 26, 2020

6,000,000－

6,000,000

0.510

Nov. 26, 2030

Twenty-sixth Series ofInvestment Corporation
Bonds (Note 1)

Mar. 16, 2021

3,000,000－

3,000,000

0.760

Mar. 14, 2036

Twenty-seventh Series ofInvestment Corporation
Bonds (Sustainability
Bonds) (Note 1)

Dec. 7, 2021

1,400,000－

1,400,000

0.420

Dec. 5, 2031

Twenty-eighth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Dec. 7, 2021

1,000,000－

1,000,000

0.670

Dec. 5, 2036

37,900,000

2,000,000

35,900,000

Total

Use

Security(Note 2)

Unsecured(Note 1) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.
(Note 2) Funds are used for purchasing real estate or real estate beneficiary interest in trust (including accompanying expenses), repaying loans payable and redeeming
investment corporation bonds, etc.
(Note 3) Amounts of investment corporation bonds to be redeemed within five years after the date of the Balance Sheet are as follows.
Due in One YearDue after One YearDue after Two Years
Due after Three Years Due after Four Yearsor Less
through Two Years
through Three Years
through Four Years
through Five Years(thousands of yen)(thousands of yen)(thousands of yen)(thousands of yen)(thousands of yen)

Investment corporation
bonds

18

5,000,000

3,000,000

47－

8,500,000

3,000,000

Financial Statements

6) Schedule of Loans Payable
LenderJapan Prime Realty Investment Corporation

Increase
Decrease
Balance as ofduringduringBalance as ofJanuary 1,
Current
Current
June 30, 2023
2023
PeriodPeriod(thousands(thousands(thousands (thousandsof yen)of yen)of yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Use

Remarks

Short-Term Loans Payable
Mizuho Bank Ltd.

－2,500,000－

2,500,000

0.153%

Jul. 5, 2023

Mizuho Bank Ltd.

－

3,000,000－

3,000,000

0.145%

Jul. 5, 2023－

5,500,000－

5,500,000
Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Total

LenderIncrease
Decrease
Balance as ofduringduringBalance as ofJanuary 1,
Current
Current June 30, 2023
2023
PeriodPeriod(thousands(thousands(thousands (thousandsof yen)of yen)of yen)of yen)(Note 4)

Use

Unsecured/
Unguaranteed

Remarks

Long-Term Loans Payable (Note 1)
Mizuho Bank, Ltd.

5,000,000－

5,000,000－

1.178%

Jun. 27, 2023

Mizuho Bank, Ltd.

2,000,000－－

2,000,000

1.011%

Mar. 11, 2024

Mizuho Bank, Ltd.

2,000,000－－

2,000,000

1.056%

Mar. 24, 2025

Mizuho Bank, Ltd.

5,000,000－－

5,000,000

0.804%

Feb. 4, 2026

Mizuho Bank, Ltd.

1,000,000－－

1,000,000

0.795%

Nov. 19, 2027

Mizuho Bank, Ltd.

2,000,000－－

2,000,000

0.646%

Dec. 5, 2029

Mizuho Bank, Ltd.

3,000,000－－

3,000,000

0.675%

Mar. 31, 2031

Mizuho Bank, Ltd.

2,400,000－－

2,400,000

0.675%

Mar. 30, 2032

Mizuho Bank, Ltd. (Green Loan)

1,000,000－－

1,000,000

0.675%

Mar. 30, 2032

600,000－－

600,000

0.675%

Mar. 30, 2032

Mizuho Bank, Ltd. (Green Loan)－

2,000,000－

2,000,000

0.533%

Dec. 27, 2028

Mizuho Bank, Ltd. (Green Loan)－

2,000,000－

2,000,000

0.401%

Jun. 25, 2027

Mizuho Bank, Ltd. (Green Loan)－

1,000,000－

1,000,000

0.948%

Jun. 27, 2033

MUFG Bank, Ltd.

1,000,000－－

1,000,000

0.873%

Aug. 31, 2023

MUFG Bank, Ltd.

5,000,000－－

5,000,000

0.510%

Mar. 25, 2024

MUFG Bank, Ltd.

2,000,000－－

2,000,000

0.633%

Dec. 13, 2024

MUFG Bank, Ltd.

1,000,000－－

1,000,000

0.638%

Aug. 8, 2025

MUFG Bank, Ltd.

5,000,000－－

5,000,000

0.600%

Aug. 29, 2025

MUFG Bank, Ltd.

3,000,000－－

3,000,000

0.593%

Sep. 5, 2025

MUFG Bank, Ltd.

4,000,000－－

4,000,000

0.450%

Jun. 23, 2028

Sumitomo Mitsui Banking Corporation

1,000,000－－

1,000,000

0.245%

Dec. 5, 2023

Sumitomo Mitsui Banking Corporation

3,000,000－－

3,000,000

0.300%

Jun. 26, 2025

Sumitomo Mitsui Banking Corporation

2,000,000－－

2,000,000

0.450%

Mar. 30, 2028

Sumitomo Mitsui Banking Corporation

2,500,000－－

2,500,000

0.675%

Mar. 30, 2032

Sumitomo Mitsui Banking Corporation

2,000,000－－

2,000,000

0.600%

Mar. 28, 2031

Sumitomo Mitsui Banking Corporation

2,000,000－－

2,000,000

0.525%

Mar. 29, 2030

Sumitomo Mitsui Banking Corporation

2,500,000－－

2,500,000

0.698%

Jun. 27, 2029

Development Bank of Japan Inc.

2,000,000－－

2,000,000

1.056%

Mar. 24, 2025

Development Bank of Japan Inc.

3,000,000－－

3,000,000

0.843%

Jun. 14, 2027

Development Bank of Japan Inc.

1,000,000－－

1,000,000

0.795%

Nov. 19, 2027

Development Bank of Japan Inc.

2,100,000－－

2,100,000

0.572%

Jun. 27, 2029

Development Bank of Japan Inc.

800,000－－

800,000

0.600%

Jun. 25, 2030

Development Bank of Japan Inc.

2,000,000－－

2,000,000

0.600%

Dec. 3, 2030

SBI Shinsei Bank, Limited

2,000,000－－

2,000,000

1.134%

Dec. 5, 2024

SBI Shinsei Bank, Limited

1,000,000－－

1,000,000

0.843%

Jun. 14, 2027

SBI Shinsei Bank, Limited

5,000,000－－

5,000,000

0.673%

Apr. 5, 2029

SBI Shinsei Bank, Limited

1,000,000－－

1,000,000

0.675%

Sep. 24, 2030

SBI Shinsei Bank, Limited

1,000,000－－

1,000,000

0.525%

Sep. 25, 2028

Shinkin Central Bank

3,000,000－－

3,000,000

0.663%

Jun. 4, 2027

Shinkin Central Bank

2,000,000－－

2,000,000

0.447%

Dec. 27, 2027

Shinkin Central Bank

2,000,000－－

2,000,000

0.525%

Dec. 14, 2029

The Norinchukin Bank

1,000,000－－

1,000,000

0.604%

Jun. 5, 2025

The Norinchukin Bank

2,000,000－－

2,000,000

0.405%

Jun. 25, 2027

The Norinchukin Bank

2,000,000－－

2,000,000

0.525%

Dec. 25, 2028

The Norinchukin Bank

2,000,000－－

2,000,000

0.525%

Dec. 14, 2029

Mizuho Trust & Banking Co., Ltd.

3,000,000－－

3,000,000

0.586%

Feb. 4, 2030

Mizuho Trust & Banking Co., Ltd.

2,000,000－－

2,000,000

0.606%

Mar. 29, 2030

Mizuho Bank, Ltd. (Sustainability Loan)

48(Note 4)

Unsecured/
Unguaranteed

19

Financial Statements

LenderJapan Prime Realty Investment Corporation

Increase
Decrease
Balance as ofduringduringBalance as ofJanuary 1,
Current
Current June 30, 2023
2023
PeriodPeriod(thousands(thousands(thousands (thousandsof yen)of yen)of yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Dec. 24, 2030

Use

Remarks

Long-Term Loans Payable (Note 1)
Mizuho Trust & Banking Co., Ltd.

2,000,000－－

2,000,000

0.675%

Aozora Bank, Ltd.

900,000－－

900,000

0.625%

Jul. 3, 2025

Aozora Bank, Ltd.

1,000,000－－

1,000,000

0.574%

Feb. 25, 2025

Aozora Bank, Ltd.

1,000,000－－

1,000,000

0.534%

Aug. 23, 2024

Aozora Bank, Ltd.

2,000,000－－

2,000,000

0.553%

Feb. 25, 2025

Aozora Bank, Ltd.

500,000－－

500,000

0.525%

Sep. 25, 2028

Aozora Bank, Ltd.

1,000,000－－

1,000,000

0.525%

Apr. 5, 2030

The Bank of Fukuoka, Ltd.

2,000,000－－

2,000,000

0.816%

Oct. 6, 2023

The Bank of Fukuoka, Ltd.

2,000,000－－

2,000,000

0.480%

Jul. 7, 2026

The Bank of Fukuoka, Ltd.

1,000,000－－

1,000,000

0.554%

Sep. 21, 2029

The Bank of Fukuoka, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

Meiji Yasuda Life Insurance Company

1,000,000－－

1,000,000

1.042%

Feb. 5, 2025

Meiji Yasuda Life Insurance Company

3,200,000－－

3,200,000

0.813%

Jun. 21, 2028

Sumitomo Life Insurance Company

2,000,000－－

2,000,000

0.453%

Oct. 11, 2024

Sumitomo Life Insurance Company

1,000,000－－

1,000,000

0.583%

Jul. 20, 2029

Sumitomo Life Insurance Company

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The Shinkumi Federation Bank

4,000,000－－

4,000,000

0.358%

Aug. 5, 2027

The Nishi-Nippon City Bank, Ltd.

3,000,000－－

3,000,000

0.646%

May 27, 2026

The Nishi-Nippon City Bank, Ltd.

1,000,000－－

1,000,000

0.525%

Dec. 14, 2029

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.969%

Sep. 24, 2024

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.811%

Jun. 5, 2028

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.675%

Dec. 24, 2030

The Chugoku Bank, Ltd.

2,000,000－－

2,000,000

0.816%

Oct. 6, 2023

The Chugoku Bank, Ltd.

1,000,000－－

1,000,000

0.661%

Mar. 25, 2026

The Yamaguchi Bank, Ltd.

1,000,000－－

1,000,000

0.795%

Nov. 19, 2027

The Yamaguchi Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The Yamaguchi Bank, Ltd.

1,000,000－－

1,000,000

0.675%

Mar. 30, 2032

The Iyo Bank, Ltd.

1,000,000－－

1,000,000

0.816%

Oct. 6, 2023

The Iyo Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The Kiyo Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The Kiyo Bank, Ltd.

1,000,000－－

1,000,000

0.675%

Mar. 30, 2032

Sompo Japan Insurance Inc.

2,000,000－－

2,000,000

0.759%

Dec. 25, 2023

Nippon Life Insurance Company

2,000,000－－

2,000,000

0.225%

Nov. 22, 2023

The Hachijuni Bank, Ltd.

1,000,000－－

1,000,000

0.300%

Oct. 9, 2025

The Hachijuni Bank, Ltd.

1,000,000－－

1,000,000

0.310%

Sep. 24, 2026

The Yamanashi Chuo Bank, Ltd.

1,000,000－－

1,000,000

0.600%

Apr. 30, 2030

The Yamanashi Chuo Bank, Ltd.

1,000,000－－

1,000,000

0.600%

Apr. 5, 2032

Resona Bank, Ltd.

2,000,000－－

2,000,000

0.888%

Sep. 30, 2031

NTT TC Leasing Co., Ltd.

1,000,000－

1,000,000－

0.408%

May 31, 2023

Kansai Mirai Bank, Limited

1,000,000－－

1,000,000

0.600%

Mar. 30, 2032

The 77 Bank, Ltd.

1,000,000－

1,000,000－

0.408%

May 31, 2023

The 77 Bank, Ltd.

－

1,000,000－

1,000,000

0.543%

Nov. 30, 2028

Daishi Hokuetsu Bank, Ltd.

1,000,000－－

1,000,000

0.566%

Nov. 21, 2028

Daido Life Insurance Company

1,000,000－－

1,000,000

0.316%

Dec. 25, 2023

The Chiba Bank, Ltd.

1,000,000－－

1,000,000

0.449%

Oct. 25, 2023

1,000,000－

1,000,000－

0.299%

Jun. 27, 2023－

1,000,000－

1,000,000

0.443%

Dec. 27, 2027

The Hyakugo Bank, Ltd.

1,000,000－－

1,000,000

0.582%

Apr. 25, 2025

The Hiroshima Bank, Ltd.

1,000,000－－

1,000,000

0.566%

Nov. 21, 2028

Mitsui Sumitomo Insurance Company,
Limited1,000,000－－

1,000,000

0.310%

Oct. 2, 2026

Sumitomo Mitsui Trust Bank Limited

1,000,000－－

1,000,000

0.691%

Mar. 25, 2026

500,000－－

500,000

0.600%

Mar. 30, 2032

165,000,000

7,000,000

8,000,000

164,000,000

Tokio Marine & Nichido Fire InsuranceCo., Ltd.
Tokio Marine & Nichido Fire InsuranceCo., Ltd.

Bank of Kyoto, Ltd.
Total

(Note 1) Amounts of long-term loans payable to be repaid within five years after the date of the Balance Sheet are as follows.

20

49(Note 4)

Unsecured/
UnguaranteedFinancial Statements

Japan Prime Realty Investment Corporation

Due in One Yearor Less(thousands of yen)
Long-term loans payable

20,000,000

Due after One Yearthrough Two Years(thousands of yen)

21,000,000

Due after Two Years
through Three Years(thousands of yen)

Due after Three Years
through Four Years(thousands of yen)

Due after Four Years
through Five Years(thousands of yen)

20,900,000

15,000,000

20,200,000(Note 2) The average interest rates represent the weighted-averages during the fiscal period, and are rounded to the third decimal place. Furthermore, fees related to loanarrangement paid to the above lenders are not included.
(Note 3) Short-term loans payable are floating-rate loans payable. Long-term loans payable are fixed-rate loans payable.
(Note 4) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redeeming
investment corporation bonds, etc.

50

21

Financial Statements

Japan Prime Realty Investment Corporation(8) Independent Auditor’s Report
Independent Auditor’s Report

The Board of Directors
Japan Prime Realty Investment Corporation
OpinionWe have audited the accompanying financial statements of Japan Prime Realty Investment
Corporation (the Company), which comprise the balance sheet as at June 30, 2023, and thestatements of income and retained earnings, changes in unitholders’ equity, cash distributions,and cash flows for the six-month period then ended and notes to financial statements, allexpressed in Japanese yen.
In our opinion, the accompanying financial statements present fairly, in all material respects, thefinancial position of the Company as at June 30, 2023, and its financial performance and its cash
flows for the six-month period then ended in accordance with accounting principles generally
accepted in Japan.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for
the Audit of the Financial Statements section of our report. We are independent of the Company
in accordance with the ethical requirements that are relevant to our audit of the financial
statements in Japan, and we have fulfilled our other ethical responsibilities in accordance withthese requirements. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our opinion.
Other Information
The other information comprises the information included in the Semi-Annual Report that
contains audited financial statements but does not include the financial statements and our
auditor’s report thereon. Management is responsible for preparation and disclosure of the otherinformation. The Supervising Officer is responsible for overseeing the Company’s reporting
process of the other information.
Our opinion on the financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the otherinformation and, in doing so, consider whether the other information is materially inconsistent
with the financial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of
this other information, we are required to report that fact.
We have nothing to report in this regard.

51

Financial Statements

Japan Prime Realty Investment Corporation

Responsibilities of Management and Supervising Officer for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statementsin accordance with accounting principles generally accepted in Japan, and for such internal
control as management determines is necessary to enable the preparation of financial statementsthat are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s
ability to continue as a going concern and disclosing, as required by accounting principles
generally accepted in Japan, matters related to going concern.
The Supervising Officer is responsible for overseeing the Company’s financial reporting
process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as awhole are free from material misstatement, whether due to fraud or error, and to issue anauditor’s report that includes our opinion. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected toinfluence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we
exercise professional judgment and maintain professional skepticism throughout the audit. We
also:
・ Identify and assess the risks of material misstatement of the financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
・ Consider internal control relevant to the audit in order to design audit procedures that areappropriate in the circumstances for our risk assessments, while the purpose of the audit of
the financial statements is not expressing an opinion on the effectiveness of the Company’s
internal control.
・ Evaluate the appropriateness of accounting policies used and the reasonableness ofaccounting estimates and related disclosures made by management.
・ Conclude on the appropriateness of management’s use of the going concern basis ofaccounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company’s ability tocontinue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the Company to cease to continue as a going concern.
・ Evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves fair presentation in accordance with accounting
principles generally accepted in Japan.
We communicate with the Executive Officer regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.
52

Financial Statements

Japan Prime Realty Investment Corporation

We also provide the Executive Officer with a statement that we have complied with the ethicalrequirements regarding independence that are relevant to our audit of the financial statements inJapan, and to communicate with them all relationships and other matters that may reasonably bethought to bear on our independence, and where applicable, actions taken to eliminate threats or
safeguards applied.
Fee-related information
The fees paid or payable to us and other EY Member Firms for the audits of the financial
statements of Japan Prime Realty Investment Corporation and other non-audit fees charged in
the audit period to Japan Prime Realty Investment Corporation are 14 million yen and 4 million
yen, respectively.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company whichis required to be disclosed pursuant to the provisions of the Certified Public Accountants Act ofJapan.
Ernst & Young ShinNihon LLC
Tokyo, Japan
September 22, 2023

Yuji Mukaide
Designated Engagement Partner
Certified Public Accountant

Daisuke Unagami
Designated Engagement Partner
Certified Public Accountant

53

Financial Statements

Japan Prime Realty Investment Corporation

OtherNotes
Notes(Information(Information only)
only)(9)(9)
Other

9.

(Property and Equipment Leased to JPR)
42nd Fiscal Period(July 1, 2022 – December 31, 2022)

43rd Fiscal Period(January 1, 2023 – June 30, 2023)

No property and equipment was leased to JPR

No property and equipment was leased to JPR(Transactions with Interested Parties)
42nd fiscal period (July 1, 2022 – December 31, 2022)
Attribute

Name ofCompany,etc.

Business
Description or
Occupation

Interested
party

Tokyo
TatemonoCo., Ltd.

Real estatebusiness

Asset
CustodianMizuho Trust& BankingCo., Ltd.

Bankingbusiness andtrust business

Percentage of Numberof Investment Units
Held Among Total
Number of Investment
Units

Transactions

Transaction
Amount(thousands ofyen)

Purchase ofreal estate

3,320,000－－

4,270,000－－

Sale ofreal estate
beneficiaryinterest
Borrowing of
long-term loans
payableInterest
expenses

2.93%－(Note) Transaction terms are determined based on prevailing market conditions.

－
21,777

Account

Long-term
loans
payableAccruedexpenses

Balance at End
of Period(thousands ofyen)

7,000,000
473

43rd fiscal period (January 1, 2023 – June 30, 2023)
Attribute

Name ofCompany,etc.

Business
Description or
Occupation

Percentage of Numberof Investment Units
Held Among Total
Number of Investment
Units

Transactions

Transaction
Amount(thousands ofyen)Interested
party

Tokyo
TatemonoCo., Ltd.

Real estatebusiness

2.93%

Purchase ofreal estate

5,770,000

Asset
CustodianMizuho Trust& BankingCo., Ltd.

Bankingbusiness andtrust business－Borrowing of
long-term loans
payableInterest
expenses(Note) Transaction terms are determined based on prevailing market conditions.

54－
21,422

Account－
Long-term
loans
payableAccruedexpenses

Balance at End
of Period(thousands ofyen)－

7,000,000
355

23