Financial Results for the 3rd Fiscal Period (“FP3”)
Sakura Sogo REIT Investment Corporation (Securities code: 3473)

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

Contents

Sakura Sogo REIT Investment Corporation

Section 1 – The Sponsors
Overview of Sponsors
Sponsor Support Structure
Galileo Group – Development Capability
Portfolio Investment Guidelines

4
5
6
7

Section 2 – Fiscal Period 3 (“FP3”) Financial Results
FP3 Financial Results
DPU Forecast vs Actual

910Section 3 – FP3 Key Initiatives to Enhance U/holder Value
Capital Recycling
12
Section 4 – JREIT Sector & Peer Comparison
JREIT Sector
JREIT Peer Comparison
JREIT Index Movement post IPO

14
15
16

Section 5 – Key Performance Indicators (KPI’s)
Portfolio KPI’s
Portfolio Sector Analysis
Office – Rent Reviews / Renewals
Financial KPI’s
Portfolio Summary

18
19
20
21
22

Section 6 – Management Key Priorities
Management Key Priorities
Part A – Internal GrowthPart B – External GrowthPart C – Capital Management
Overview of Borrowings
Status of Unitholders

24
25
30
32
33
34

Appendix
Balance Sheet and Statement of Income
Income and Expenditure by Property for FP3
Property – Appraisal & Yield Analysis
Portfolio Map
Overview of the Investment Corporation
Disclaimer

36
37
39
41
42
43

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)2

Sakura Sogo REIT Investment Corporation

Section 1 – The Sponsors

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)3

Overview of Sponsors

Sakura Sogo REIT Investment Corporation

Galileo GroupThe Nippon Kanzai Group, established in 1965, is headed by

The Galileo Group is an independent Australian real estate and funds

Nippon Kanzai Co. Ltd., one of the major companies involved inbuilding management and operation in Japan, offering a full-line ofmanagement business with an extensive track record in real estate
investment and development in Australia, Japan and the U.S. Galileo

real estate management services. It is entrusted with the
management and operation of a variety of buildings including officehas significant real estate capital markets experience with seniorpersonnel having been directly involved in the IPO and ongoingbuildings, condominiums and retail facilities in major cities acrossJapan. Through its business operations, it has acquired extensive

management of 9 listed REITs for over 20 years. The Group
commenced operations in Japan in 2006.

know-how in management and operation of buildings of various
sizes, asset types and location.
% Revenue from Building Maintenance Operations1

Galileo Group Total Global Acquisitions and Developments2

87.6%

531.6bn￥

Revenue from Building Maintenance Operations1
REIT Track Record￥

81.0bn2003

ASX listed REIT: Galileo Shopping America Trust

Total Revenue1

2006

ASX listed REIT: Galileo Japan Trust

2016

TSE listed REIT: Sakura Sogo REIT

92.5bn￥1 As at end of March 2017

2 Based on exchange rate TTP as at end March 2018

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

4

Sponsor Support Structure

Sakura Sogo REIT Investment Corporation

Leverage off of the complementary skill sets of Nippon Kanzai Group and Galileo Group
Sakura Real Estate Funds Management, Inc. (“the Asset Management Company”) receives extensive support for external and internal growth based on
the Sponsor Support Agreements executed with Nippon Kanzai Group’s core companies and Galileo Group1

Support Provided
Sales information on properties held and granting first rights of refusal
Information on external properties

External Growth Support

Warehousing functions
Information on the real estate transaction market and results of market analysis
Joint ownership of opportunities
Advice on investment strategies and global offerings
Advice on the management and operation of properties

Internal Growth Support

Support and cooperation with sourcing, redevelopment and renovations
Staff secondment and other human resource support

Same Boat Investment by the Nippon Kanzai Group and Galileo Group
Both sponsors2 acquired investment units of the Investment Corporation at the time of IPO in order to align their interests with those of the unitholders’.
As a result, each owns 2.6% of investment units issued and outstanding (5.2% in total by both sponsors)

Investment by Nippon Kanzai Group

Investment by Galileo Group

1 "Nippon Kanzai Group’s core companies" refers to Nippon Kanzai, Tokyo Capital Management and Japan Property Solutions
2 "Sponsors" refers to Nippon Kanzai,Tokyo Capital Management and Galileo which have executed Sponsor Support Agreements

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)5

Galileo Group – Development Capability

Sakura Sogo REIT Investment Corporation

Galileo Group - impressive development track record






Delivered some of Australia’s most attractive and successful residential apartment and land subdivision projects
Equity partnerships with a number of leading Australian financial institutions and superannuation funds
Land and construction financing with a range of major Australian banking institutions
Galileo considering opportunities to expand development operations in Japan
Japan focus - development of small / mid size assets. Potential pipeline for Sakura Sogo REIT

Examples of current / recent key projects in Australia
King & Phillip

Metro Residences

Arlington Grove

The Residences

Arena

Palisade

Location

SydneyLocation

SydneyLocation

SydneyLocation

SydneyLocation

Brisbane

Location

SydneyApartments

104

Apartments

553

Apartments

246

Apartments

87

Apartments

191

Apartments

245

Value

¥30bn

Value

¥44bn

Value

¥19bn

Value

¥28bn

Value

¥9bn

Value

¥14bn

Completion

2020

Completion

2015

Completion

2018

Completion

2014

Completion

2015

Completion

2018

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

6

Portfolio Investment Guidelines

Sakura Sogo REIT Investment Corporation

Overview

Flexible investments possible with respect to asset type and location enabling the Asset Management Company to enhance unitholder value
Able to reduce portfolio concentration risks by aiming to diversify the portfolio by sector, location, tenant and lease type
Ongoing review of real estate market trends to identify potential new, and optimize existing revenue streams
Pursue opportunities to actively recycle capital to enhance unitholder returns

Investment Ratio by Asset Type1
Investment Ratio by Asset TypeGrowthOffice30～60％
Residential
10～30％

Characteristics of Asset Type

During economic expansion, up-side potential can be capitalized on
By targeting office buildings of a B-grade standard or above for investment, it is possible
to pursue a large number of investment opportunities that offer relatively high liquidity
and tenant diversity
 Rental demand and rent rates are relatively stable irrespective of economic changes andtenants are diversified making residential housing suitable as a medium to long-term
stable investment


Retail30～60％
Other
0～20％

Stability

Areas with stable population, expected to support ongoing retail sales that result insecure rental income A long-term stable cash flow possible via lease agreements with a tenure of at least
three years or more which do not allow for early termination


The potential and value of each individual property will be identified and the goal will be
to conduct flexible property acquisition and investment

Investment Ratio by Location2
Tokyo Metropolitan Area
Approx. 50%

Regional Major Cities
Approx. 40%

Other
Approx.
10%

1 The Investment Corporation may consider properties which do not fulfill some of the above criteria and acquire if it believes this is in the best interests of unitholders.
2 The ratios above are target ratios over the medium to long-term which depending on the real estate market and future property acquisitions may temporarily exceed or fall below the target ratios.

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)7

Sakura Sogo REIT Investment Corporation

Section 2 – FP3 Financial Results

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)8

FP3 Financial Results

Sakura Sogo REIT Investment Corporation

FP3 - Forecast vs. Actual
Unit: ￥mil

FP3 Forecast

FP3 Actual

Variance

Operating revenue

2,645

2,662

17

Operating expenses

1,384

1,358

(26)

Operating profit

1,261

1,304

43

150

151

1

Ordinary profit

1,109

1.153

44

Net profit

1,109

1,152

43

3,330

3,460

130

Non-operating expenses

Distribution per unit (DPU) (¥)

CommentIncrease in operating revenue:- ¥11m increase in carpark revenue from Shiroi Logiman co-op- ¥4m revenue increase at Yoyogi due receipt of key money

Reduction in operating costs:- decrease in utilities, non-deductible consumption taxes andother management expenses



Net realized gain on sale of Sannomiya is included in both
Forecast (Y263) and Actual (Y261m)

Forecast for FP4 and FP5 (fiscal periods ending 31 August 2018 and 28 February 2019)
Unit: ￥mil

Unit: ￥mil

FP5 Forecast

Comment

FP4 Forecast

Stabilized NOI and Investment
corporation expenses from FP4

2,418

Operating revenue

2,448

Operating expenses

1,394

1,353

Operating profit

1,054

1,065

Non-operating expenses

154

165

Ordinary profit

900

900

Net profit

899

899

2,700

2,702

Distribution per unit (DPU) (¥)
Annualized DPU yield

1

Comment

Slight decrease in operating
revenue and expenses due toseasonal fluctuations whencompared to FP4

5.7%

1Annualized DPU yield based on the closing price of ¥94,500 on 12 April 2018 and using the aggregate forecast DPU for FP4 and FP5 (¥5,402)

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)9

DPU – Forecast vs Actual

Sakura Sogo REIT Investment Corporation¥ per unit
3,600

3,460
3,330

3,300
3,000

2,863

2,803

2,700

2,702

2,700

2,700
2,400
2,100
1,800
1,529
1,500
1,164

1,200
900
600
305
300
-

FP1

FP2

FP3

FP4

Forecast

Updated Forecast

Actual< 1 Apr 2016 to 28 Feb 2017 >< 1 Mar 2017 to 31 Aug 2017 >< 1 Sep 2017 to 28 Feb 2018 >< 1 Mar 2018 to 31 Aug 2018 >













Savings in investment unit
issuance costs
Annual building inspection
contingency not required
Lower than forecast costs
for audit, tax andaccounting

Increase in occupancy
Savings in operating
expenses

Includes net realized gainon sale of Sannomiya(¥261m)Management fee waiver
based on NOI ended FP2

FP5< 1 Sep 2018 to 28 Feb 2019 >Represents stabilized DPU (NOI and Investment
Corporation expenses)

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)10

Sakura Sogo REIT Investment Corporation

Section 3 – FP 3 Key Initiatives to Enhance Unitholder Value

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)11

Capital Recycling

Sakura Sogo REIT Investment Corporation

Sale of Regional Residential asset at attractive premium

Acquisition of new Central Tokyo Residential

Royal Hill Kobe Sannomiya II

Abode Yoyogi Parkside, Shibuya-ku
NOI Yield 1

4.6%

NOI Yield 2

4.4%

Post dep’n NOI yield

3.3%

Post dep’n NOI yield

3.8%

Realised gain

317m

Build date

20 Sep 2017

Build date

Sep 2004

Acquisition date

29 Sep 2017

Acquisition date

9 Sep 2016

Appraisal value¥1.610bn

Date of sale

11 Sep 2017

Acquisition price¥1.600bn

Sale price¥1.800bn

Appraisal value¥1.550bn

Acquisition price¥1.480bn

Book value¥1.483bn

Portfolio weighting to Tokyo

SourceDirect

51% to 54%

Premium to September 2016 acquisition price

22%

Upgrade to FP3 DPU (¥2,700 to ¥3,330)

23%

Average age of residential portfolio reduced3

3 years

Reduction in medium term (12 year) capital expenditure4¥78m

Increase in post dep’n NOI yield

0.5%

1 NOI Yield equates to appraisal NOI / sale price

3 Average age of residential portfolio decreased from 22 to 19 years

2 NOI Yield equates to appraisal NOI / acquisition price4 Forecast capital expenditure decreased from ¥85.8 mil to ¥7.7 mil

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)12

Sakura Sogo REIT Investment Corporation

Section 4 – JREIT Sector & Peer Comparison

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

13

JREIT Sector

Sakura Sogo REIT Investment Corporation

JREIT Sector
 Total market capitalization as at February 2018 of ￥11.8 trillion
 60 JREIT’s with 2 new entrants in 2018. The volume of IPO and PO has decreased relative to the level of activity over the past 5 to 6 years
 The DPU yield gap of larger vs smaller REIT’s remains wide
Number of Listed J-REITs and Market Capitalisation1

JREIT DPU Yields – Spread with JGBs still attractive2(¥ Trillion)

14.0

70

Market Cap. (LHS)

12.0

60

No. of Listed REITs (RHS)

10.0

50

8.0

40

6.0

30

4.0

20

2.0

10

(%)
12.0

J-REIT Distribution Yield (Weig hte d A ver age)

10.0

JGB Yield (10 Ye ars)
Spr ead

8.0
6.0

0.0

0
01/09 03/09 05/09 07/09 09/09 11/09 13/09 15/09 18/03
17/09

Number of Listed J-REITs and Market Capitalisation3

4.0
2.0
0.0
-2.0
03/09

05/09

07/09

09/09

11/09

13/09

15/09

17/09
18/03

JREIT DPU Yields – Significant gap between small and large cap REITs4
8.0%

Year

IPO
Value
(USDm)

Volume

2012
2013
2014
2015
2016
2017
2018

PO

4
6
6
5
7
2
2

2,620
4,260
2,237
1,131
2,885
930
439

Volume

11
37
30
35
30
25
6

IPO+POValue(USDm)Value(USDm)

Volume

2,055
7,039
5,464
6,608
5,159
4,260
448

15
43
36
40
37
27
8

4,674
11,299
7,701
7,739
8,044
5,190
887

J-REIT
Total
MarketCap(USDm)
42,497
71,69999,60999,438114,156
108,052
111,394

Note: Exchange rate as of 30 March 2018 (1 USD=¥106.20)

7.0%
6.0%
5.0%
4.0%
3.0%
2.0%
0

1 Source: ARES

3 Source: ARES

2 Source: Bloomberg

4 Source: Capital IQ

200

400

600

800

1,000

Market Cap. ¥ Billion

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

14

JREIT Peer Comparison

Sakura Sogo REIT Investment Corporation

JREIT Peer Comparison1Sakura Sogo REIT (“SKR”) undervalued compared to Diversified and Small Cap REIT peers
SKR’s forecast DPU yield is 90 basis points (“bps”) higher than Diversified REITs and 60 bps higher than Small Cap REITs as of 12 April 2018
Based on current trading price SKR’s implied NOI cap rate is 5.2%, 50 bps higher than Diversified REITs
SKR has a greater proportion of its portfolio (by value) located in Tokyo’s central five wards relative to:- The average for Diversified REITs- The average for Small Cap REITs
Price / Net Asset Value3

Annualised DPU Yield1
6.0%

5.7

1.20

4.8

5.0%

5.1
1.00

4.0%

0.80

3.0%

0.60

2.0%

0.40

1.0%

0.20

0.0%
SKR

Diversified REITS

Small Cap REITs

Implied Capitalization Rate2
5.3%
5.2%

0.99

0.99

SKR

Diversified REITs

0.95

0.00
Small Cap REITs% of Portfolio located in Tokyo Central Five Wards4
45.0%

5.2

42.3

40.0%

5.1%

5.0

5.0%

36.7

35.0%
30.0%

4.9%

25.0%

4.8%

18.2

20.0%

4.7

4.7%

15.0%

4.6%

10.0%

4.5%

5.0%

4.4%

0.0%

SKR

Diversified REITs

Small Cap REITs

1 Source: SMBC Nikko Securities Inc.- calculated using data obtained from Capital IQ

SKRDiversified REITs

Small Cap REITs

4 Source: J-REIT DB – Weighted average calculated using AUM of each J-REIT

2,3 Source: SMBC Nikko Securities Inc.

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

15

JREIT Index movement post IPO1

Sakura Sogo REIT Investment Corporation

After some short term underperformance post IPO, SKR units generally traded in sync with the fluctuation of the TSE REIT index. However, after theannouncement of FP3 Asset Replacement on July 31, 2017 , SKR units recovered to the IPO offer price, marking a historical high price of 101,900
yen in mid-January 2018
(JPY) (a)104,000(b)(c)(d)(e)(g) (h)(i)(j)(Units)35,000

Historical highJanuary 16: 101,900 yen
Dividend Yield: 5.92%

Notice concerning capital
recycling transaction.
Refer slide 12

99,00094,000(f)

30,000SKR:

25,000 93,700 yen

Historical low
Sep. 8: 73,300 yen
Dividend yield: 7.75%

Offer price:
91,000 yen

March. 30, 2018

(103.0%)
Dividend yield2:
5.8%

20,00089,00015,000
Historical low of ending priceNovember 14: 75,400 yen
Dividend Yield: 7.53%

84,00010,00079,00074,0002016/9/8

5,000

2016/11/18

2017/1/28

2017/4/9

SKR(a) (Thu) Sep. 8, 2016

TSE REIT INDEX:
1,688.66pt(92.2%)

2017/6/19

TSEREIT2017/8/29

2017/11/8

2018/1/18

0
2018/3/30

Trading Volume of SKR
Announced acquisition of “Abode Yoyogi Parkside”.

SKR listed on the stock market.

(b) (Mon) Oct. 31, 2016

SKR included in TSE REIT INDEX.

(c) (Mon) Nov. 14, 2016

Released revision of earnings forecast and interim financial results.

(g) (Mon) Aug. 28 2017

Announced disposition of “Royal Hill Kobe Sannomiya II”.
Released revision of operating and distribution forecasts for the fiscal
periods ending Aug. 2017 and Feb. 2018. (JPY 2,700, JPY 3,460)
Announced debt refinancing of short and long term borrowings.

(d) (Mon) Apr. 3, 2017

Announced execution of pipeline support agreements by asset
management company.

(h) (Mon) Sep. 11 2017

Announced of completion of disposition of “Royal Hill Kobe Sannomiya II”.

(i) (Mon) Oct. 16 2017(e) (Thu) Apr. 13, 2017

Released Financial Results for the 1st fiscal period.

(j) (Wed) Dec. 13 2017

Released Financial Results for the 2nd fiscal period.
FOMC announced lifting federal funds target rate by 25 basis points, to a
1.25 to 1.50 percent range.

(f) (Mon) Jul. 31, 2017

1 As of Mar 30th 2018. Indexation by using SKR offer price (91,000 yen).
2 Dividend yield calculated using current DPU forecast for FP4 & FP5 (JPY2,700 and JPY2,702 respectively) and Mar. 30th 2018 SKR closing price (JPY93,700)

Source: Bloomberg
Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)16

Sakura Sogo REIT Investment Corporation

Section 5 - Key Performance Indicators

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)17

Portfolio KPI’s

Sakura Sogo REIT Investment Corporation

Overview
Real estate market conditions remain robust. According to CBRE Tokyo office vacancy continued to fall and was 1.5% as at Q4 2017.
 Increase of 0.9% in portfolio appraisal value. Office continued to be the strongest sector with a 2.0% increase Continued high level of occupancy across the portfolio
 Continued upward rent reviews in the office portfolio

Portfolio Value
Appraisal Value (￥bn)

Book Value (￥bn)

Unrealized Gain (￥bn)@ FP2
31 August 201760.00557.655

2.350

@ FP3
28 February 201860.54357.673

2.870

Variance

0.9%

0.0%

22.1%
Hiei Kudan Building

Portfolio PerformanceOccupancy (%)

NOI Cap Rate (%)1

NOI (¥bn)1@ FP2
31 August 2017

98.0

5.3

3.152

@ FP3
28 February 2018

98.4

5.2

3.132

Variance

0.4

0.1

0.6%

Office Market Rents2

Office Passing Rents3

Tokyo Office Vacancy (%)4

@ FP2
31 August 201716,295

15,602

2.3@ FP3
28 February 201816,295

15,770

1.5

Variance

0.0%

1.1%

0.8

Office Market Trends

Suroy Mall Chikushino

NK Building

1 As per independent appraisals dated August 2017 and February 2018
2 Weighted average office market rents (¥/tsubo/month) as per independent appraisals dated August 2017 and February 2018
3 Weighted average office passing rent (¥/tsubo/month) as per office lease agreements reflected in independent appraisals dated August 2017 and February 2018
4 Source: CBRE Market Overview Japan Office Q2 2017 and Q4 2017. Vacancy rate represents “All Office Grades” (Grade A, Grade A-minus and Grade B)

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)18

Portfolio - Sector Analysis

Sakura Sogo REIT Investment Corporation

Occupancy (%)

OfficeRetailResidential

Other

@ FP2
31 August 2018
@ FP3
28 February 2018

97.9

98.8

95.9

97.8

99.8

98.9

96.4

98.2

Variance

1.9

0.1

0.5

0.4

OfficeRetailResidential

Other

@ FP2
31 August 2018
@ FP3
28 February 2018

15,602

4,889

4,556

4,542

15,770

4,845

4,636

4,525

Variance

1.1%

0.9%

1.8%

0.0%

OfficeRetailResidential

Other

@ FP2
31 August 2018
@ FP3
28 February 201826.24023.170

6.575

4.020

26.76023.120

6.645

4.018

Variance

2.0%

0.2%

1.1%

0.0%

OfficeRetailResidential

Other

@ FP2
31 August 2018
@ FP3
28 February 2018

4.5

5.7

6.3

6.0

4.3

5.8

6.0

6.0

Variance

0.2

0.1

0.3

0.0

Passing Rents1

Appraisal Values (¥bn)2

NOI Cap Rates (%)2

1 ￥per tsubo per month reflecting in place passing rents
2 As per independent appraisals dated August 2017 and February 2018

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)19

Office - Rent Reviews / Renewals

Sakura Sogo REIT Investment Corporation

Rent reviews1

New Leases / Lease renewals

Number of rent reviews% of office portfolio reviewed
Number of rent increases
NRA with rent increase (tsubo)3

Number of leases expiring

21

6.4

Number of leases renewed20

1

Number of leases cancelled

1

366.1

Tenant retention rate (%)2

95.2

Average rent increase (%)

14.7

Total increase in annual office rent (¥m)

11.0

Office portfolio tenant movement in / out (Tsubo)
250
273

225

214

-74

-61

FP2

FP3
Move out area

50
-150
-518

-350
-550
FP1
Move in area

Average % change - replacement tenant vs previous passing rent
8.0%

7.6%

6.0%

6.7%

4.0%
Hiei Kudan Building

Seishin Building

Takadanobaba Access

2.0%

3.6%

0.0%
FP1
1 11 tenants with renewals due in FP3 and FP4 were previously approached for rent reviews during FP2

FP2

Average increase in rent

FP3
Average decrease in rent

2 Tenant retention rate is the # of office leases that renewed in the period / # leases expiring in the period

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)20

Financial KPI’s

Sakura Sogo REIT Investment Corporation

OverviewNAV per unit increased 1.6% due to an uplift in appraisal values
Increase in unit price of 4.3% since 13 October 2017
Annualized DPU yield of 5.7%
P/NAV increased 3.2% to 0.98

Balance SheetLTV (%)

Ave. loan maturity (years)

Total Liabilities (￥bn)@ FP2
31 August 2017

45.9

2.94

32.9

@ FP3
28 February 2018

45.9

2.45

32.7

Variance

0.0

0.49

0.6%

Net Equity (￥bn)

NAV (￥per unit)

Total Assets (￥bn)@ FP2
31 August 201729.25

94,910

63.13

@ FP3
28 February 2018

29.25

96,47063.19

Variance

0.0%

1.6%

0.1%

NK Building

Abode Yoyogi Parkside

Investment Units
Unit Price (¥ per unit)

Annualized DPU yield (%)

P/NAV

@ FP2
13 October 2017

90,500

6.71

0.95

@ FP3
10 April 2018

94,4005.72

0.98

Variance

4.3%

1.0

3.2%
Azabu Amerex Building

1 Annualized DPU yield based on unit price of ¥90,500 as at 13 October 2017 and the aggregate of FP3 and FP4 DPU Forecasts as at 16 October 2017
2 Annualized DPU yield based on aggregate of current FP4 and FP5 DPU Forecasts and closing price on 12 April 2018 of ¥94,500

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)21

Portfolio Summary

Sakura Sogo REIT Investment Corporation

At 28 February 201818

No. of properties

98.4

Average occupancy %Total appraised value ¥m60,543

Average NOI yield %1

5.2

Total book value ¥m57,673

Average NOI yield post depreciation %1

4.3

Portfolio Diversification

Lease type (by income)■ Investment Ratio by Asset Type■ Investment Ratio by Location
Other
7.2%

Other
6.7%
Residential
11.4%
Office42.9%
Major
Regional
Cities39.1%

Tokyo
Metropolitan
Area
53.7%

Standard Japanese leases %55.5

Non-cancellable leases %2

44.5

WALE3 of non-cancellable leases (years)

7.4

Retail39.1%

1 Calculated based on 28 February 2018 independent appraisals.
2 Includes leases that be cancelled by paying cancellation penalties
3 Weighted average lease term to expiry

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)22

Sakura Sogo REIT Investment Corporation

Section 6 - Management Key Priorities

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)23

Management Key Priorities

Sakura Sogo REIT Investment Corporation

External Growth

Identifying off market investment
opportunities via sponsor relationships



Add to existing pipeline support
network (currently 5)Foster relationships with mid-scale
developers

Capital Management


Explore opportunities to recycle
assets which can:Internal Growth

Enhance Unitholder
Value



- Upward rent reviews particularly
in office- Increase distributions- Explore opportunities to create
new revenue streams- Enhance portfolio characteristicsCarefully manage borrowings to
mitigate maturity risk and minimize
ongoing cost of debt
Cumulative investment scheme for
the Asset Management Company
directors and employees to furtheralign interest with unitholders

Actively pursue growth

Utilize the expertise of Nippon
Kanzai to ensure buildings are wellmaintained while minimizing costs

Strategic capital expenditure initiativesto:- Maintain high occupancy- Minimize downtime on vacant space- Enhance revenue through current andfuture rent reviews

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)24

Sakura Sogo REIT Investment Corporation

Part A - Internal Growth Initiatives

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)25

Internal Growth

Sakura Sogo REIT Investment Corporation

Office Successful track record of achieving rent increases in office assets
 Uplift of 14.7% for a rent review, ¥11 mil p.a.
 Based on independent appraisals, over 75% of office floor space is at or below assessed market rent
Rent Gap1> 20%

10 tenants
887 tsubo

12.1%> 10% < 20%

12 tenants
892 tsubo

52.1%

between 0% - 10%

40 tenants
3,855 tsubo

Monitor / consider upward rent revisions for tenants with a rent gap ofless than 10%

23.8%

less than 0%

21 tenants
1,760 tsubo

Maintain sound relationships and ensure building services meet tenant
expectations
Focus on high level of tenant retention – target > 80%

12.0%Will continue to pursue rent increases for tenants in this category

76.2%

3rd Fiscal Period

2nd Fiscal Period

1st Fiscal Period
7

11.6

8.2

6

14.4

9.2

1

14.7

11.0

Number ofincreases

Averageincrease (%)

Amount p.a.
(¥ mil)Number ofincreases

Averageincrease (%)

Amount p.a.
(¥ mil)Number of
Increases

Averageincrease (%)

Amount p.a.
(¥ mil)1 Average passing rent vs. assessed market rent based on net rentable area from independent appraisals dated 28 February 2018

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)26

Internal Growth

Sakura Sogo REIT Investment Corporation

Retail
La Park Kishiwada

Residential
2F Replacement of common area flooring Has created a better environment for shoppers and resulted in
attracting a new tenant at a higher rent rate (10%) with shorter
down time than forecast resulting in an increase in rent revenueby ¥650k for the period.

Abode Yoyogi Parkside

Post acquisition activity

The property was acquired in a fully vacant state just after completion in
September 2017.Through proactive leasing efforts with property manager
100% occupancy was achieved in less than 6-months.
Item

Appraisal/
TargetAchieved

Var.

6,827,000

7,146,000 +4.7%

Rent Rate(¥/Tsubo)

17,54318,368 +4.7%

Target 100%
Occupancy(months)

Apr 2018

Monthly Rent (¥)

Feb 2018

2

Other
La Park Kishiwada

Utilities cost reduction

 Re-tender of electricity supply resulting in a target reduction of¥7.0m p.a. (21.0%)
 Renegotiated terms with gas supplier resulting in a target
reduction of ¥940k p.a. (22.1%)

Confomall Sapporo

Carpark income enhancement

 Through an open tender process plan to replace carpark operators
 This will result in an increase in NOI by approximately Y1.8m p.a.

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)27

Internal Growth

Sakura Sogo REIT Investment Corporation

Internal Growth Initiatives
 Nippon Kanzai Group has been involved in identifying and implementing various initiatives across the portfolio to assist in achieving internal growth.

Portfolio

Building maintenance fees review

A review was undertaken which included re-tendering service agreements
for 10 properties. Annual savings in building maintenance fees by ¥3.6m
was achieved, effective from September 2018

Shin Yokohama Nara

Suroy Mall Chikushino

Takadanobaba Access

La Park Kishiwada

Azabu Amerex

Suroy Mall Nagamine

Portfolio

Capital expenditure savings

Nippon Kanzai Group facilitated savings in maintenance capital expenditureof over ¥6 million during the period

Property

Seishin

La Park
Kishiwada

Tsukasamachi

Description of
Works

Fire
suppression,
exterior wall,
HVAC
renewal

HVAC
renewal, fire
suppression,
electricalFire
suppression,
downlight
replacement

Ave 3rd party
tender cost (¥m)

11.35

10.44

6.94

Actual cost NKGroup (¥m)

10.7

9.14

6.56

Total Savings (¥m)

0.65

1.30

0.38

Savings %

5.7

12.5

5.5

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)28

Internal Growth

Sakura Sogo REIT Investment Corporation

NOI Enhancement
Through various proactive initiatives, expected to enhance NOI by in total over ¥25m from FP1 through FP4 (forecast).

FP4(forecast)

FP3

FP2

FP1

Properties

Action

Revenueincrease

Confomall Sapporo
La Park Kishiwada
10-properties

Plans to replace car park operator via open tender
Convert storage space for tenant into smoking, lounge area
Re-tendering building maintenance service agreements¥1.8m p.a.
¥1.0m p.a.

NK Building
Office portfolio
La Park Kishiwada
La Park Kishiwada

Renegotiated terms with rooftop antenna telecommunications provider
Re-tendered electricity service provider
Re-tendered electricity service provider
Renegotiated terms with gas supplier¥1.0m p.a.

Azabu Amerex
La Park Kishiwada
Shin Yokohama Nara
Takadanobaba AccessConfomall Sapporo

Negotiated new lease terms for carpark spaces
Added telecommunications mobile antenna
Converted unutilized space to rental storage
Attached timer to HVAC facilities for managing after hours electricity usage
Installed LED lighting¥2.2m p.a.
¥0.9m p.a.
Y0.1m p.a.

La Park Kishiwada
2-office properties
Shin Yokohama Nara

Tenant repositioning and new leases
Introduced lunchtime food service vendors
Installed LED lighting in the lobby¥0.6m p.a.
¥2.3m p.a.

Costreduction¥3.6m p.a.

¥3.0m p.a.
¥7.0m p.a.
¥0.9m p.a.

¥1.0m p.a.
¥0.5m p.a.

¥0.3m p.a.

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)29

Sakura Sogo REIT Investment Corporation

Part B - External Growth Initiatives

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)30

External Growth

Pipeline Support Agreements• Enhance investment opportunities throughdirect channels• Pipeline Support Agreements will provide
preferred negotiation rights for SKR• Five existing Pipeline Support Agreements
have been executed:• Three entered into by the Nippon
Kanzai Group• Two directly by the AssetManagement Company

Sakura Sogo REIT Investment Corporation

 Asset Management Company has a
Right of First Refusal for a 2-year
old modern logistics asset• Asset is single tenanted to a
TSE listed company• Over 60,000m2 NLA

Existing / New Relationships• Leverage off an existing broad range of realestate industry contacts• Fund Managers• Developers• Financiers• Explore opportunities to source from existing
relationships and continue to expand network
to identify off market acquisition opportunities
Example : Abode Yoyogi Parkside

Medium-term Goal for Assets Under Management

Galileo Sponsor – Future Developments
 Galileo Group is a very successful developerin Australia and is investigating development
opportunities in Japan with an immediate
focus on the Tokyo Metropolitan Area
 Potential future developments would provide
attractive acquisition opportunities for SKR
 Refer to slide 6 for more details of Galileo
developments

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)31

Sakura Sogo REIT Investment Corporation

Part C - Capital Management

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)32

Overview of Borrowings

Sakura Sogo REIT Investment Corporation

Borrowings

Loan cost and duration (at 28 February 2018)
Loan amount(¥ mil)LenderShort-termLong-term

Interest rate

Maturity date

Weighted average cost (%)

0.96

Average duration (Years)

2.45

31-Aug-17

A Syndicate of lenders with Sumitomo
Mitsui Banking Corporation:
Sumitomo Mitsui Banking Corporation,
Shinsei Bank, Limited,
Resona Bank, Limited,
Aozora Bank, Ltd.,ORIX Bank Corporation,
The Nishi-Nippon City Bank, Ltd.,The Bank of Fukuoka, Ltd,
Sumitomo Mitsui Trust Bank, Limited

Total

1,400

Base Rate +0.2%(floating)

30-Aug-18

6,000

0.62473% (fixed)

30-Aug-18

4,000

0.71096% (fixed)

30-Aug-19

6,000

0.81842% (fixed)

31-Aug-20

6,000

0.93842% (fixed)

31-Aug-21

5,600

Base Rate +0.8%(floating)

31-Aug-22

Debt Ratio - Term
Short Term
25.5%

29,000Collateral: Unsecured and unguaranteedLong Term
74.5%

Repayment Schedule

Balance of Borrowings by Lender

8,000

The NishiNippon City
Bank, Ltd.
3.5%

7,000
6,000
5,000
4,000
3,000
2,000
1,000
2018

2019

2020

2021

2022

The Bank ofFukuoka Ltd.
3.5%

ORIX Bank
Corporation
6.9%
Aozora Bank,
Ltd.
10.3%
Resona Bank,
Limited.
10.3%

Sumitomo
Mitsui Trust
Bank, Limited.
3.5%

Interest Rate Ratio
Floating
interest rate
24.1%

Sumitomo
Mitsui Banking
Corporation
31.0%
Shinsei Bank,
Limited.
31.0%

Fixed
interest rate
75.9%

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)33

Status of Unitholders

Sakura Sogo REIT Investment Corporation

No. of Investment Units by Investor Type

100%

3,227

1.0%

35,110

10.5%

8,161

2.5%

42,704

12.8%

Main Unitholders

Securities firms

Foreigners
28,041Rank

at 28 February 2018

Name

Number ofUnits Owned

Percentage
Share (%)1

1

The Master Trust Bank of Japan, Ltd.

28,133

8.45

2Japan Trustee Service Bank, Ltd.

23,104

6.94

3

JP Morgan Bank (Ireland) Plc 380423

15,4144.63

4The Nomura Trust and Banking Co., Ltd.
(Investment account)）

12,672

3.81

5

Galaxy JREIT Pty. Ltd.

8,700

2.61

5

Nippon Kanzai Co., Ltd.

8,700

2.61

7

Trust & Custody Services Bank, Ltd. (Securities
Investment Trust Account)

7,161

2.15

8

Credit Suisse Securities (Europe) Ltd. PB
Omnibus Client Account

6,802

2.04

9

Kinki Sangyo Credit Union

5,587

1.68

10

Individual investor

2,761

0.83

8.4%
21,51480%

6.5%

Other domestic corporations
77,49423.3%

80,050

24.0%

Financial institutions

60%

Individuals/others

40%

189,12956.8%

180,572

54.2%

20%

1 Percentage share is the number of units owned expressed as a percentage of total investment

0%
Aug '17

Feb '18

units issued (rounded down to second decimal place).

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)34

Sakura Sogo REIT Investment Corporation

Appendix

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)35

Balance Sheet and Statement of Income

Balance Sheet at 28 February 2018
AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Other
Non-current assets
Property, plant equipment
Intangible fixed assets
Investments and other assets
Total assets

Statement of Income
Unit: ￥mil

5,173
974
4,056
143
58,02457,002691
331
63,197

Liabilities
Current liabilities

Sakura Sogo REIT Investment Corporation

8,087

Unit: ￥mil

Operating revenue

2,662

Leasing business revenue
Other leasing business revenue
Capital gain from real estate disposition
Operating expenses

2,060
341
261

Expenses related to rent business

1,092

Asset management fee
Asset custody fee/Administrative service fees

1,358
172
25
6

Directors’ compensation
Other operating expenses
Operating profit

63
1,304

129

Non-operating expenses

151

1,400
6,000
163

Interest expenses

110

Borrowing related expenses
Ordinary profit (loss)

1,153

Advances received

383

Net profit (loss) before income taxes

1,153

Other
Non-current liabilities

12

Net profit (loss)

1,152

24,703

Unappropriated retained earnings

1,152

Operating accounts payable
Short-term loans payable
Repayment long term loan within one year
Accounts payable – other

Long-term loans payable
Tenant leasehold and security deposits in trust
Total liabilities
Net Assets
Total unitholders’ equity
Unitholders’ capital

41

21,6003,103
32,79030,40729,255
1,152

Surplus
Total net assets

30,407

Total liabilities and equity

63,197

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)36

Income and Expenditure by Property for FP3

Sakura Sogo REIT Investment Corporation(181 operating days)

Unit: ￥’000

OF-01

OF-02

OF-03

OF-04

OF-05

OF-06

OF-07

RT-01

RT-02

Seishin
BuildingNK
Building

Tsukasamachi
Building

Takadanobaba
AccessAzabu Amerex
Building

Hiei Kudan
Building

Shin Yokohama
Nara Building

La Park
Kishiwada

Suroy Mall
Chikushino

Operating revenue fromreal estate leasing

235,988

122,799

108,702104,508

66,694

66,891

81,246

513,560

296,520

Leasing businessrevenue

212,957

108,946

96,486

83,87961,36964,464

66,216

386,748

292,624

Other Leasing businessrevenue

23,031

13,853

12,215

20,629

5,325

2,427

15,030126,812

3,896

Operating expenses fromreal estate leasing

57,05035,48526,94834,70021,53218,806

27,417

288,944

75,639Management fees

18,04012,805

10,73815,882

8,318

10,9989,804

129,656

37,659

Utilities expenses

13,837

9,983

5,929

8,013

3,670

42

7,305

108,284

4,116

239

157

145

177

90

133

165

1,251

678

3,439

1,594

2,062

656

1,666

218

1,519

706

2,020

750

750

750

750

375

750

750

1,850

750

20,27910,003

7,043

8,722

7,324

6,470

7,614

45,08819,885

464

192

279

496

86

193

258

2,107

10,528

178,937

87,31481,75469,80745,161

48,08453,828

224,616

220,880

12,334

6,750

7,014

8,897

2,349

2,699

8,489

41,23636,413

166,60380,56374,73960,91042,81245,38545,339183,380

184,467

Insurance premium
Repair & Maintenance
Trust Fees
Property Tax
Other expenses
Leasing NOI
Depreciation
Operating income (loss)
from real estate leasing

1

1 including ground lease rent

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)37

Income and Expenditure by Property for FP3

Sakura Sogo REIT Investment Corporation(181 operating days)

Unit: ￥’000

RT-03

RT-04

RS-01

RS-02

RS-04

RS-05

OT-01

OT-02

OT-03

Seiyu
Minakuchi

Suroy Mall
Nagamine

Shiroi
LogimanMatsuyaResidence
SekimeUrban Plaza
ImazatoAbode Yoyogi
Parkside

Funabashi HiTech ParkⅠ

Funabashi HiTech Park Ⅱ

Confomall
SapporoOperating revenue fromreal estate leasing

Non-disclosure

179,138

143,841

86,02639,35930,983Non-disclosure

Non-disclosure

70,587

Leasing businessrevenue

Non-disclosure

146,485

127,860

78,25637,573

19,846

Non-disclosure

Non-disclosure

58,815

Other Leasing businessrevenue

Non-disclosure

32,652

15,981

7,769

1,785

11,136

Non-disclosure

Non-disclosure

11,772

Operating expenses fromleasing business

36,29557,40850,434

31,993

12,234

14,689

6,565

5,211

31,610Management fees

6,039

15,41621,157

13,583

5,603

13,859

990

990

7,323

Utilities expenses

025,388

1

2,903

520

177

0

0

11,319Insurance premium

531

264

637

254

121

34

122

76

280

1

1,422

11,660

9,405

2,130

80

0

0

1,890

750

750

1,250

375

375

424

750

750

750

3

4,686

3,363

9,178

Repair & Maintenance0

Trust Fees
Property Tax

12,181

13,251

14,046

5,181

3,201

0

2

914

1,682

290

281

112

16

30

867

Non-disclosure

121,730

93,40654,03327,125

16,293Non-disclosure

Non-disclosure

38,97742,485

17,86818,77011,079

5,826

4,727

9,550

2,955

13,947

Non-disclosure

103,861

74,63642,953

21,29911,566

Non-disclosure

Non-disclosure

25,030

Other expenses
Leasing NOI

16,792

Depreciation
Operating income (loss)
from real estate leasing

1 Capex expenditure only
2 Including ground lease rent
3 Included purchase cost

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

38

Property – Appraisal & Yield Analysis

Sakura Sogo REIT Investment Corporation
at 28 February 2018

OfficeAsset Type

Retail

No.

OF-01

OF-02

OF-03

OF-04

OF-05

OF-06

OF-07

RT-01

RT-02

RT-03

Property Name

Seishin
BuildingNK
Building

Tsukasamachi
Building

Takadanobaba
AccessAzabu Amerex
Building

Hiei Kudan
Building

Shin Yokohama
Nara Building

La Park
Kishiwada

Suroy Mall
Chikushino

Seiyu
Minakuchi

Shinjuku-ward,Tokyo

Chiyoda-ward,Tokyo

Chiyoda-ward,
Tokyo

Shinjuku-ward,
Tokyo

Minato-ward,Tokyo

Chiyoda-ward,
Tokyo

Kohoku-ward,
Yokohama

Kishiwada city,
Osaka

Chikushino,
KyushuMinakuchi,
Shiga

Appraisal @FP2 (¥bn)

8,610

3,910

3,960

3,460

2,270

2,050

1,980

6,640

7,820

4,240

Appraisal @FP3 (¥bn)

8,850

3,980

4,040

3,510

2,270

2,090

2,020

6,640

7,790

4,220

NOI Yield@ FP2 (%)

4.0%

4.5%

4.5%

4.7%

4.2%

4.7%

5.5%

5.9%

5.6%

6.0%

NOI Yield@ FP3 (%)

3.9%

4.4%

4.5%

4.6%

4.2%

4.6%

5.3%

6.0%

5.6%

6.0%

NOI Yield @FP2 post depr
(%)

3.8%

4.2%

4.2%

4.2%

4.1%

4.5%

4.7%

4.7%

4.7%

4.0%

NOI Yield @FP3 post depr
(%)

3.6%

4.1%

4.1%

4.1%

4.0%

4.4%

4.5%

4.7%

4.7%

4.0%

Address

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)

39

Property – Appraisal & Yield Analysis

Sakura Sogo REIT Investment Corporation
at 28 February 2018

Asset Type

RetailNo.

RT-04

Residential
RS-01

RS-02

Other
RS-04

RS-05

OT-01

OT-02

OT-03

Total
(18 properties)

Property Name

Address

Suroy Mall
Nagamine

Shiroi
LogimanMatsuyaResidence Sekime

Urban Plaza
ImazatoAbode Yoyogi
Parkside

Kumamoto city,
Kumamoto

Shiroi city,
Chiba

Osaka city,
Osaka

Osaka city,
Osaka

Shibuya-ward,
Tokyo

Funabashi city,
Chiba

Funabashi city,
Chiba

Sapporo city,
Hokkaido

Funabashi Hi-Tech Funabashi Hi-Tech
ParkⅠ
ParkⅡ

Confomall
SapporoAppraisal @FP2 (¥bn)

4,470

2,170

1,930

965

1,6101

1,800

780

1,440

60,105

Appraisal @FP3 (¥bn)

4,470

2,160

1,930

945

1,610

1,800

778

1,440

60,543

NOI Yield @FP2 (%)

5.6%

7.2%

6.4%

5.9%

4.3%1

6.1%

6.2%

5.6%

5.2%

NOI Yield @FP3 (%)

5.6%

6.9%

6.4%

5.9%

4.2%

6.1%

6.2%

5.6%

5.2%

NOI Yield @FP2 post depr
(%)

4.8%

5.5%

5.3%

4.7%

3.8%1

5.1%

5.4%

3.8%

4.4%

NOI Yield @FP3 post depr
(%)

4.8%

5.2%

5.2%

4.7%

3.6%

5.1%

5.5%

3.7%

4.3%

1 Based on an Appraisal for Non-Completed Buildings with effective date 1 July 2017

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)40

Portfolio Map

OF-01 Seishin Bldg

OF-02 NK Bldg.

Sakura Sogo REIT Investment Corporation

OF-03 Tsukasamachi Bldg

OF-04 Takadanobaba Access

OF-05 Azabu Amerex Bldg

OF-06 Hiei-Kudan Bldg

OF-07 Shin-Yokohama Nara Bldg

OT-03

RT-01 La Park Kishiwada

RT-02 Suroy Mall Chikushino

RT-03 Seiyu Minakuchi

RT-04 Suroy Mall Nagamine

Coming soon

Chiba
Tokyo

RS-01 Shiroi Logiman

RS-02 Matsuya Residence Sekime

RS-04 Urban Plaza Imazato

RS-05 Abode Yoyogi Parkside

RS-02
RT-02

RT-01

RT-03
RS-04

OF-02
OF-04
OF-03
OF-01
OF-06
RS-05
OF-05

RS-01

OT-02
OT-01

Kanagawa
OF-07

RT-04
OT-01 Funabashi Hi-Tech Park Ⅰ

OT-02 Funabashi Hi-Tech ParkⅡ

OT-03 Confomall Sapporo

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)41

Overview of the Investment Corporation

Sakura Sogo REIT Investment Corporation

Schematic Diagram of the Investment Corporation’s Structure
Sponsor / Parent Company of Asset Management
Company

Investment Corporation❷

Asset Custody Company/Administrator ofUnitholder Registry/General Administrator related
to the operation of the administrative institution

Galileo Sydney Holdings Pty Limited

Sumitomo Mitsui Trust Bank, Limited.

❸
Asset Management Company❶

Sakura Sogo REIT Investment❹

Sakura Real Estate Funds Management, Inc.
❸
SponsorNippon Kanzai Co., Ltd.
Tokyo Capital Management Co., Ltd.

General Administrator for Accounting Affairs

General Meeting ofUnitholders

Kaneyama & Associates

Board of Officers
Executive Officer: Makoto Muranaka
Supervisory Officer： Hirotaka Isayama
Supervisory Officer： Shigeru Kaneda
Accounting Auditor
PricewaterhouseCoopers Arata❶ Asset Management Entrustment Agreement❷ Asset Custody Entrustment Agreement / Entrustment
Agreement for Administrator of the Investment Unitholder
Registry / Entrustment Agreement for Clerical
undertakings (Institution services）❸ Sponsor Support Agreement❹ Business Entrustment Agreement

Overview of Asset Management Company
Trade Name

Sakura Real Estate Funds Management, Inc.

Date of Incorporation

July 7, 2015

Stated Capital

101.52 million yen

Shareholder Composition

Galaxy JREIT Pty Limited 50%
Tokyo Capital Management Co., Ltd. 50%(based on voting rights: Galaxy JREIT Pty Limited 100%)

Principal Lines of Business

Discretionary Investment Business,management of Investment Corporation’s assets

Officers

6 Directors (2 Full-time Directors), 1 Statutory Auditor

Financial Instrument Business
Registration

Reg. No.: Director of Kanto Local Finance Bureau (FI) No. 2907
Member of Investment Trusts Association, Japan

Real estate agency business license

License No.: Tokyo Metropolitan Governor (1) No. 98232

Approval as Entrustment - Based
Agency Services for Transactions

Approval No.: Minister of Land, Infrastructure,
Transport and Tourism No. 100

General Meeting of Unitholders
Statutory Auditor
Board of Directors
Investment Committee

Compliance Committee

Representative Director and Chairman / Representative Director and President
Compliance Officer

Investment Division

Finance and Planning Division

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)42

Disclaimer

Sakura Sogo REIT Investment Corporation

This presentation material has been prepared solely for the purpose of providing information, and not for soliciting investments in certain products.
The presentation material includes, in addition to a description of Sakura Sogo REIT Investment Corporation (hereinafter the “Investment Corporation”), charts, data, etc.
prepared by Sakura Real Estate Funds Management, Inc. (hereinafter the “Asset Management Company”) based on data and indices published by third parties.
Furthermore, it includes present analysis, judgements and other opinions of the Asset Management Company regarding such information.
The contents of the presentation material have not been audited, and their accuracy nor integrity is guaranteed. The analysis and judgement by the Asset Management
Company are its current opinions and the contents may be modified or repealed without any advance notice.
The Investment Corporation or the Asset Management Company bear no responsibility with regard to the accuracy of the data or indices published by third parties(including data based on real estate appraisal reports).
The content of this presentation material include statements on forecast and future operating results. Such statements are based on the information available at the timeof preparation of this presentation material and certain assumptions for unforeseeable factors, and thus do not guarantee future operating results of the Investment
Corporation and may differ from actual operating results.

Sakura Sogo REIT Presentation Material for FP3 (Six months ended 28 February 2018)43