(Reference) SUMMARY OF FINANCIAL RESULTS (REIT)
For the 3rd Fiscal Period Ended February 28, 2017
April 14, 2017
REIT securities issuer:
Representative:

Nomura Real Estate Master Fund, Inc. (“NMF”)
Securities code: 3462
Satoshi Yanagita, Executive Director

Asset management company:
Representative:
Inquiries:

Nomura Real Estate Asset Management Co., Ltd.
Norio Ambe, President and Chief Executive Officer
Kenichi Okada, Head of NMF Investment Management Group

Scheduled date of filing of securities report:
Scheduled date of commencement of distribution payout:
Preparation of supplementary materials on financial results:
Holding of briefing session on financial results:

Stock exchange listing: Tokyo Stock Exchange
URL: http://www.nre-mf.co.jp/en/

TEL: +81-3-3365-8767

May 29, 2017
May 19, 2017
Yes
Yes (for institutional investors and analyst)[Amounts less than one million yen are truncated]

1. Financial Results for the 3rd Fiscal Period (from September 1, 2016 to February 28, 2017)(1) Operating Results[% figures are the rate of increase (decrease) compared with the previous period]
Operating revenues
Period ended
February 28, 2017
August 31, 2016

million yen
34,71430,976

Operating profit

%
12.1
27.4

Net income
per unit
Period ended
February 28, 2017
August 31, 2016

million yen
11,244
11,682

Ordinary income
%
(3.7)
80.2

Return on unitholders’equityyen

million yen
8,672
9,356

%
(7.3)
131.0

Ratio ofordinary income
to total assets

%

2,072
2,513

Net income%

million yen
8,670
9,355

(7.3)
131.1

Ratio ofordinary income
to operating revenues
%

1.7
2.0

%

0.8
1.0

25.0
30.2

(2) Distributions

Period ended
February 28, 2017
August 31, 2016

Distribution
per unit(excluding
distribution
in excess of net
income)Total
distributions(excluding
distribution
in excess of
net income)

yen
2,073
2,473

million yen
8,671
9,204

Distribution
in excess of
net income per
unit

Total
distributions
in excess of
net income

yenmillion yen
3,994
2,095

955
563

Distribution
per unit(including
distribution inexcess of net
income)Total
distributions(including
distribution
in excess of
net income)

3,028
3,036

million yen
12,666
11,300yen

Distribution
payout ratio

Ratio ofdistributions to
net assets

%
100.0
98.3

%
1.6
1.9

(Note 1) Of the ¥563 distribution in excess of net income per unit in the fiscal period ended August 31, 2016, ¥0 is a distribution of the allowance fortemporary difference adjustments and ¥563 is other distributions in excess of net earnings. Furthermore, the ratio of decreasing surplus is 0.004.
Of the ¥955 distribution in excess of net income per unit in the fiscal period ended February 28, 2017, ¥646 is a distribution of the allowance fortemporary difference adjustments and ¥309 is other distributions in excess of net earnings. Furthermore, the ratio of decreasing surplus is 0.003.
(Note 2) Distribution Payout Ratio is calculated using the below formula and truncated at the first decimal place.
Distribution Payout Ratio = Total Distributions (excluding distribution in excess of Net Income) / Net Income × 100(Note 3) Ratio of Distributions to Net Assets is calculated using the below formula and truncated at the first decimal place.
Ratio of Distributions to Net Assets = Distribution Per Unit (excluding distribution in excess of Net Income) / {(Net Assets per Unit at the
beginning of the fiscal period + Net Assets per Unit at the end of the fiscal period) / 2} × 100(3) Financial Position
Period ended
February 28, 2017
August 31, 2016

Total assets

Net assets

million yen
1,105,979
935,964

million yen
556,104
479,311- 1 -Net assets to total assets

Net assets per unit

%
50.3
51.2

yen
132,939
128,777

(4) Status of Cash FlowsNet cashprovided by (used in)operating activities
Period ended
February 28, 2017
August 31, 2016

Net cashprovided by (used in)investing activities

million yen
14,772
48,162

Net cashprovided by (used in)financing activities

million yen(13,608)(29,555)

Cash andcash equivalents
at end of period

million yen(13,419)(1,661)

million yen
73,331
75,2702．Earnings Forecasts for the 4th Fiscal Period (from March 1, 2017 to August 31, 2017)[% figures are the ratio of increase (decrease) compared with the previous period]
Distribution
per unit

PeriodendingAugust 31,
2017

Operating revenues

Operating profit

Ordinary income

millionyen

millionyen

millionyen

35,869%3.3

13,412%
19.3

10,777%24.3(excluding
distribution
in excess of
net income)Net income

millionyen

10,776

Distribution
in excess of
net income
per unit

Distribution
per unit(including
distribution
in excess of net
income)

%

yen

yen

yen

24.3

2,495

455

2,950

(Reference) Forecast net income per unit for the fiscal period ending August 31, 2017 is ¥2,576*Other(1) Changes in Accounting Policies, Changes in Accounting Estimates and Retrospective Restatements① Changes in accounting policies accompanying amendments to accounting standards, etc.:② Changes in accounting policies other than those in ①:③ Changes in accounting estimates:④ Retrospective restatements:

None
None
None
None

(2) Number of Investment Units Issued and Treasury Investment Units① Number of investment units issued (including treasury investment units)
As of February 28, 2017:
4,183,130 units
As of August 31, 2016:
3,722,010 units② Number of treasury investment units
As of February 28, 2017:– units
As of August 31, 2016:– units(Note) For the number of investment units used as the basis for calculation of net income per unit, please refer to“Notes on Per Unit Information” on page 45.
* Status of audit procedure implementation
At the time of the disclosure of this document, audit procedures for financial statements pursuant to the
Financial Instruments and Exchange Act (Act No. 25 of 1948) have not been completed.
* Forward-looking statements
The earnings forecasts and other forward-looking statements contained in this document are based on
information currently available to and certain assumptions deemed reasonable by NMF. Accordingly, actual
earnings performance and other results may differ materially due to a variety of factors. Furthermore, suchforward-looking statements do not constitute a guarantee of future distributions. For more information about
the assumptions underlying forward-looking statements and the use of such statements, please refer to“Assumptions Underlying Earnings Forecasts for the 4th Fiscal Period (Ending August 31, 2017)” on page 13.

This is an English language translation of the original Japanese announcement of the financial statements(“Kessan Tanshin”). This translation is provided for information purpose only. Should there be any discrepancy
between this translation and the Japanese original, the Japanese original shall prevail.

- 2 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Attachment
1. Related Corporations of the Investment Corporation
Disclosure is omitted because there are no significant changes from the information presented under“Structure of the Investment Corporation” in the most recently published securities report (published
November 28, 2016).
2. Management Policy and Management Status(1) Management Policy
Disclosure is omitted, since there are no significant changes from the “Investment Policy,” “Investment
Targets” and “Distribution Policy” presented in the securities report (filed on November 28, 2016).
(2) Management Status① Outline of Fiscal Period under Review
NMF was established on October 1, 2015 through the consolidation type merger of the former Nomura
Real Estate Master Fund, Inc. (hereinafter the “former NMF”), Nomura Real Estate Office Fund, Inc.
(hereinafter “NOF”) and Nomura Real Estate Residential Fund, Inc. (hereinafter “NRF”), and listed its
investment securities (TSE code: 3462) on the Real Estate Investment Trust Section of the Tokyo Stock
Exchange on October 2 of the same year.
NMF’s basic policy is to manage its assets mainly as investments in real estate, etc. (meaning the assets
specified in the Ordinance for Enforcement of the Act on Investment Trusts and Investment
Corporations (Act No. 198 of 1951)), specifically real estate, leaseholds of real estate, surface rights, andthe beneficial interests of trusts formed by entrustment of only these assets, to secure stable income overthe medium to long term and steady growth of assets under management (Note 1). In order to realize thisbasic policy, NMF adopts an investment strategy that centers on the Greater Tokyo area (Tokyo, Kanagawa,Chiba and Saitama prefectures), which offers strong tenant demand, while also considering regional
diversification through investment in all of Japan’s three major metropolitan areas and other major cities.
By combining the “diversified type strategy,” in which investments are made in a variety of facilities, suchas offices, retail facilities, logistics facilities and residential facilities, with the “large-scale REIT strategy,”which increases portfolio stability through property and tenant diversification, as well as the “leasing value
chain” with the sponsor, the Nomura Real Estate Group, NMF aims to increase unitholder value by
securing stable income over the medium to long term and the steady growth of assets under management.
In November 2015, NMF formulated and announced its medium- to long-term management strategy.
The medium- to long-term management strategy separates the 10 years following NMF’s establishment
into three phases (the quality phase, growth phase and master phase) and aims for stable management overthe medium to long term through steady growth in asset size and the establishment of the fund’s brand. In
the initial quality phase, NMF will utilize the benefits of being one of Japan’s largest diversified REITs topromote internal growth centered on strategic property replacements (SPRs) and upside sectors (Note 2),aiming to improve the portfolio’s quality and increase the asset size.
(Note 1) Throughout this document, “assets under management” refers to assets that belong to NMF.
Furthermore, “Real estate, etc.” refers to assets defined in Article 29, Paragraph 1 (1) or (2) of NMF’s Articles of Incorporation, and “realestate backed securities” refers to assets defined in Article 29, Paragraph 1 (3) of NMF’s Articles of Incorporation (“Real estate, etc.” and“real estate backed securities” are hereinafter collectively referred to as “real estate related assets”).
Real estate and the underlying real estate of real estate related assets are together referred to as the “real estate under management” or“properties.”(Note 2) Upside sectors refer to sectors for which an increase of rental revenue can be expected, particularly offices as well as retail facilities instation areas.

② Investment Environment
The Japanese economy has continued to gradually improve, backed by increased exports and recovery inproduction due to improvement in overseas economies. In 2017, growth is expected to continue, as
projections call for foreign demand staying strong while ongoing monetary easing and large-scale economic
policy provide support for domestic demand. However, the policies of the new administration in the
United States, politics in European countries, the real estate bubble in China and other factors remaincauses for caution due to their potential to negatively impact the world economy.
In the J-REIT market, conditions remain favorable for raising funds through borrowing, as interest rates
have stayed low since the introduction of yield curve control and other measures determined at the Bankof Japan’s September 2016 Monetary Policy Meeting, despite a rate hike in the United States in December- 3 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 20172016. Furthermore, fund procurement by means of new J-REIT listings and additional public offerings byexisting J-REITs was strong throughout 2016.
With regard to the office leasing market, while the vacancy rate is making little downward progress, rents
have continued to gradually rise. Going forward, the office rental market is expected to remain tight, as the
supply of new properties in central Tokyo remains low and demand is bolstered by companies seeking toincrease their floor space, driven by improved corporate results due to the cheap yen and global economic
recovery.
Concerning the environment surrounding retail facilities, rents for facilities in major urban retail areas
have not moved much recently. Due in part to the impact of shifting consumption by visitors to Japan,
demand growth in areas where it had been strong, such as Ginza and Shibuya, has shown signs of levelingoff, at least temporarily, but vacancies in high-quality facilities remain scarce. Demand generated by visitorsfrom overseas is expected to continue growing steadily, as economic recovery and the growth of the
middle class in emerging Asian countries drive up the volume of tourists visiting Japan over the long term.
However, consideration must be given to the impact on market rents of the upcoming completions of newlarge-scale retail facilities around the country.
In terms of logistics facilities, sales reported by top third-party logistics providers (Note), NMF’s main
logistics facility tenants, have generally been firm. While growth in demand for dedicated domestic logistics
centers for retailers seems to have tapered off, the market is being supported by demand for logistics withshort lead times generated by logistics innovation on the part of manufacturers and the expansion of
e-commerce. In the Greater Tokyo area, the vacancy rate in the area served by the Metropolitan Inter-City
Expressway has risen. New properties are generally taking longer to find tenants, and new development ismoving further from the city center. Given this, the possibility of local market imbalances is a cause forcaution. At the same time, in the Kinki region, the upcoming completion of large-scale facilities is expected
to result in a surplus of supply.
(Note) Third-party logistics (3PL) refers to logistics services outsourced by shippers for part or all of their logistics functions.

Concerning the environment surrounding the rental apartment market, both the existing stock and new
supply of high-quality rental condominiums in prime locations are low, while major urban areas continue to
see net population inflow. Reflecting these conditions, the overall occupancy rate of J-REIT-owned rental
condominiums remains high. Rents are forecast to follow a gentle upward trajectory for the time being,
backed by tight supply, strong demand and improving incomes. That said, the growing supply of newly
built rental housing in suburban areas remain a reason for caution, as it could indirectly exert a negative
effect on the market.
In the real estate transaction market, overall investor appetite remains strong and competition to acquire
properties is intensifying, but transaction volume is decreasing. While the supply/demand balance is
expected to remain largely unchanged for some time under the accommodative financial environment, if
uncertainty in domestic and foreign financial markets arises or risk avoidance grows more pronounced,
changes in the funding environment could lead to diminished appetite for investment. As such, thesetrends must be watched closely.
③ Management Performance
Under the circumstances described above, NMF executed an absorption-type merger with TOP REIT,
Inc. (“TOP”) as detailed below in “④ Merger with TOP REIT, Inc.” Thus, the 19 properties (totalacquisition price: ¥137,489 million (Note)) TOP then held, including office, retail and residential facilities,
were transferred to NMF on September 1, 2016. Furthermore, also on September 1, 2016, NMF acquired
Landport Kashiwa Shonan II (acquisition price: ¥10,800 million). As a result, at the end of the fiscal
period under review, NMF held 272 properties (total acquisition price: ¥932,896 million), the ratio ofinvestment in the Greater Tokyo area was 82.8%, the gross leasable area of the portfolio was 1,968,528.97
m2, and the portfolio remained highly diversified.
Furthermore, since the close of the third fiscal period (February 28, 2017), NMF has executed orreached agreements for the following property acquisitions and dispositions as part of its SPRs. On March
17, 2017, NMF acquired nORBESA (acqusition price: ¥8,500 million). On March 31, 2017, NMF acquired
six properties (Nakaza Cui-daore Building, NRE Kichijoji Building (additional stake acquisition), Landport
Kashiwa Shonan I, PRIME URBAN Gakugei Daigaku Parkfront, Proud Flat Omori III, Proud Flat
Kinshicho; total acquisition price: ¥29,795 million), including some developed by Nomura Real Estate- 4 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Development Co., Ltd., the sponsor. NMF also sold properties that it expected to see decline incompetitivenes due to age and increasing maintenance and management costs or because of thetermination of tenant contracts. Specifically, NMF reached agreements to sell a 51% quasi co-ownershipstake in the beneficial interest in a real estate trust for the NOF Nihonbashi Honcho Building as well as the
NOF Technoport Kamata Center Building on March 31, 2017 (total sale price: ¥16,750 million); Tennozu
Park Side Building on May 12, 2017 (sale price: ¥12,700 million); Mitsubishi Motors Shibuya and
Mitsubishi Motors Suginami on June 1, 2017 (total sale price: ¥2,616 million); and Ito-Yokado
Higashi-Narashino Store on June 5, 2017 (sale price: ¥664 million);
In terms of property and facility management, as described above in “② Investment Environment,”
rental demand is expanding, backed by the gradual recovery of the Japanese economy. Accordingly, theoccupancy rate of the entire portfolio as of the end of the fiscal period under review was stable and high,at 99.2%. In the office sector, a key upside sector, the rental market has seen particularly notable recovery,
with rises in newly advertised rents and successful rent increases upon contract renewal driving the internal
growth of the portfolio as a whole.
(Note) The assets transferred from TOP are accounted for using the purchase method. Accordingly, the real estate appraisal value for theseproperties was used as their acquisition price. Specifically, the appraisal value of Ito-Yokado Higashi-Narashino Store as of August 31, 2016,
and that of the other properties transferred from TOP as of March 31, 2016 or April 1, 2016, were recorded as the acquisition prices for therespective properties.

④ Merger with TOP REIT, Inc.
On May 26, 2016, NMF and TOP entered an agreement to enter an absorption type merger (the“absorption type merger with TOP”) with NMF as the surviving corporation and TOP as the absorbed
corporation, effective September 1, 2016.
The absorption type merger with TOP went into effect on September 1, 2016, and the 19 properties thenheld by TOP, including office, retail and residential facilities, were transferred to NMF. On the same day, as
payment for the merger, NMF issued 2.62 new investment units per unit of TOP, for a total of 461,120 new
units. Furthermore, beginning November 25, 2016, NMF paid a merger distribution in an amount equivalent
to the cash distributions for TOP’s final fiscal period (May 1 to August 31, 2016), which came to ¥5,671 perunit of TOP, for a total of ¥998 million.
⑤ Status of Fund Procurement
During the fiscal period under review, NMF refinanced or repaid using cash on hand interest-bearing
liabilities with approaching maturities of ¥49,012 million (including ¥5,000 million in investment
corporation bonds).
As a result, including ¥90,117 in interest-bearing liabilities transferred from TOP as a result of theabsorption type merger with TOP, the balance of interest-bearing liabilities at the end of the fiscal period
under review was ¥498,784 million, and the ratio of interest-bearing liabilities to total assets (LTV) was
45.1%.
NMF’s ratings at the end of the fiscal period under review are shown below. These ratings do not
represent judgments on NMF investment units. Concerning NMF investment units, there are no credit
ratings that credit rating agencies have provided or made available for inspection, nor are there credit ratings
that credit rating agencies are scheduled to provide or make available for inspection at the request of NMF
Credit rating agency

Rating description

Note

Japan Credit Rating Agency, Ltd. (JCR)

Long-term issuer rating:AA

Rating outlook:

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

Issuer rating:A+

Rating outlook:

StableStandard & Poor's Ratings Japan K.K.
(S&P) (Note)

Long-term corporate credit
rating:Short-term corporate credit
rating:A

Rating outlook:

Stable(Note) Company name changed to S&P Global Ratings Japan Inc. on April 1, 2017.

- 5 -

A-1

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

⑥Business Performance and Distributions
In the 3rd fiscal period, operating revenues totaled ¥34,714 million, operating profit reached ¥11,244
million, ordinary income totaled ¥8,672 million, and net income came to ¥8,670 million.
The per-unit distribution for the 3rd period was ¥3,028.
In order to maximize the distribution of earnings included in deductible expenses by applying special
measures for tax treatment (Article 67-15 Paragraph 1 of the Act on Special Measures Concerning Taxation(Act No. 26 of 1957)), NMF decided to distribute almost the entire amount of income as stipulated in
Article 136 Paragraph 1 of the Investment Trust Act, less the reversal of allowance for temporary
difference adjustments (as stipulated in Article 2 Paragraph 2 (30) of the Regulations Concerning
Accounting of Investment Corporations; the same applies hereinafter), excluding the portion for which
per-unit distributions would be less than ¥1. Accordingly, NMF declared an earnings distribution perinvestment unit of ¥2,073. This amount excludes the distribution in excess of earnings discussed below.
In accordance with the distribution policy stipulated in the Articles of Incorporation and inconsideration of the impact that such costs related to the merger of the three REITs that created NMF andthe absorption type merger with TOP REIT as goodwill amortization costs, net asset deductions (asdescribed in Article 2 Paragraph 2 (30) (b) of the Regulations Concerning Accounting of Investment
Corporations) and the reversal of allowance for temporary difference adjustments (excluding net asset
deductions; hereinafter referred to together with goodwill amortization costs and other costs related to themerger of the three REITs and absorption type merger with TOP REIT as “merger-related costs”) will
have on distributions, NMF will make a distribution in excess of earnings in an amount that it determines
equivalent to the merger-related costs (hereinafter “distribution in excess of earnings”). When
implementing a distribution in excess of earnings, if the distribution of the period’s allowance fortemporary difference adjustments is less than the amount of merger-related costs, other distributions inexcess of net earnings will also be implemented.
For the fiscal period under review, NMF decided to implement a ¥3,994 million distribution in excess ofearnings. This figure is equivalent to almost the entire sum (excluding the portion for which per-unit
distributions would be less than ¥1) of ¥2,622 million in goodwill amortization expenses and ¥1,374
million in fees paid to the Asset Management Company for the absorption type merger with TOP REIT.
Of this, ¥2,702 million will be a distribution of allowance for temporary difference adjustments, for a
per-unit distribution of allowance for temporary difference adjustments of ¥646. Other distributions inexcess of net earnings will be ¥1,292 million; other distributions in excess of net earnings per unit will be
¥309.

- 6 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

⑦ Outlook for Next Fiscal Period
Given the conditions described above in ② Investment Environment, NMF will continue to implement
its medium- to long-term management strategy, promoting SPRs to enhance portfolio quality and promoteinternal growth, mainly in upside sectors, aiming to increase unitholder value by securing stable income overthe medium to long term and the steady growth of assets under management.
Following the September 1, 2016 absorption-type merger with TOP, NMF’s asset value at the end of thethird fiscal period surpassed ¥930 billion, further securing its standing as one of the largest diversified
REITs in Japan. By incorporating TOP’s excellent portfolio of mainly urban, mainly office properties, andleveraging the Nomura Real Estate Group’s asset management know-how, NMF aims to further accelerateinternal growth.
⑧ Significant Subsequent Events
Ａ．Transfer of the asset(1) NMF sold the following asset after the conclusion of the third fiscal period (February 28, 2017).
a. NOF Technoport Kamata Center Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
December 22, 2016
 Transfer date
March 31, 2017
 Transfer price¥5,020 million
 Buyer
A domestic special purpose corporation (tokutei
mokuteki kaisha) Impact on 4th fiscal period earnings— (Note)(2) NMF reached an agreement to sell and sold the following asset after the conclusion of the third
fiscal period (February 28, 2017).
a. NOF Nihonbashi Honcho Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
March 21, 2017
 Transfer date
March 31, 2017
 Transfer price¥11,730 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 4th fiscal period earnings¥777 million(Scheduled)(3) NMF reached agreements to sell the following assets after the conclusion of the third fiscal period(February 28, 2017).
a. Tennozu Park Side Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
April 4, 2017
 Transfer date (Scheduled)
May 12, 2017
 Transfer price (Scheduled)¥12,700 million
 Buyer
A domestic special purpose corporation (tokutei
mokuteki kaisha) Impact on 4th fiscal period earnings— (Note)- 7 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017b. Mitsubishi Motors Shibuya
 Type of asset
 Use
 Contract date
 Transfer date (Scheduled) Transfer price (Scheduled) Buyer
 Impact on 4th fiscal period earnings(Scheduled)

Trust beneficiary interest in mainly real estate
Retail facility (land)
March 31, 2017
June 1, 2017
¥1,720 million
Nomura Real Estate Development Co., Ltd.
¥121 millionc. Mitsubishi Motors Suginami
 Type of asset
 Use
 Contract date
 Transfer date (Scheduled) Transfer price (Scheduled) Buyer
 Impact on 4th fiscal period earnings(Scheduled)

Trust beneficiary interest in mainly real estate
Retail facility (land)
March 31, 2017
June 1, 2017¥896 million
Nomura Real Estate Development Co., Ltd.
¥139 million

The impact of (1) through (3), above, on earnings for the 4th fiscal period (March 1, 2017 to August 31,2017) will be recorded as gain on sales of real estate under operating revenues.
(Note) An amount equivalent to the loss on sales of real estate resulting from the sales of NOF
Technoport Kamata Center Building and Tennozu Park Side Building has been recorded as
impairment loss. For details, please refer to “*2. Impairment loss” under “Notes to Statement of
Income and Retained Earnings,” above.
(Additional Information)
A. Asset Sales(1) NMF plans to sell the following asset after the conclusion of the third fiscal period (February 28,2017).
a. Ito-Yokado Higashi-Narashino Store Type of asset
Trust beneficiary interest in mainly real estate Use
Retail facility
 Contract date
December 28, 2016
 Transfer date (Scheduled)
June 5, 2017
 Transfer price (Scheduled)¥664 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 4th fiscal period earnings¥14 million(Scheduled)
The impact of this sale on earnings for the 4th fiscal period (March 1, 2017 to August 31, 2017) will berecorded as gain on sales of real estate under operating revenues.

- 8 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Reference)
A. Property acquisition
NMF decided to acquire the assets stated below on January 27, 2017, and concluded the acquisition
on March 31, 2017.
Property namePRIME URBAN Gakugei Daigaku Parkfront

Type of asset

Real estate(Registry)

Location (Note 1)

2-13-4 Meguro-honcho, Meguro Ward, Tokyo(Street)2-12-20 Meguro-honcho, Meguro Ward, Tokyo

Structure (Note 1)

RC, 6F

Land area (Note 1)

750.39㎡

Floor area (Note 1)

1,541.81㎡

Type of ownership(Land) Ownership(Building) Ownership

Completion date
(Note 1)February 29, 2008

Acquisition price(Note 2)

¥1,300 million
January 27, 2017

Date of agreement(Date of agreement on purchase and sale of realestate)Date of acquisition

March 31, 2017 (Date of delivery of real estate)

SellerUndisclosed (Note 3)

Financing

Financed with cash on hand and borrowings(Note 1) Location (registry), Completion Date, Structure, and Area are based on the information in the real estate registry.
(Note 2) The amount excluding acquisition related costs, property tax, city planning tax, consumption tax and local
consumption tax is stated.
(Note 3) Undisclosed, since concent have not obetained from the seller.

- 9 -Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

NMF decided to acquire the assets stated below on February 21, 2017, and concluded the acquisitionof nORBESA on March 17, 2017, and Nakaza Cui-daore Building on March 31, 2017.
Property namenORBESA

Nakaza Cui-daore Building

Type of asset

Trust beneficiary interest in real estate

Real estate(Registry)(Registry)
1-8-7 Dotonbori, Chuo Ward, Osaka City, Osaka

Location (Note 1)

5-1-1 Minamisanjo-Nishi, Chuo Ward,
Sapporo City, Hokkaido(Note 2)

(Street)1-7-21 Dotonbori, Chuo Ward, Osaka City,
Osaka

Structure (Note 1)

S/RC B1/7F

S B2F/7F

Land area (Note 1)

3,491.74㎡

1,686.28㎡

Floor area (Note 1)

21,564.42㎡

8,280.08㎡

Type of ownership(Land) Ownership(Building) Ownership(Land) Ownership(Building) Ownership

Completion date
(Note 1)

April 13, 2006

February 18, 2004

Acquisition price(Note 3)

¥8,500 million¥11,600 million

February 21, 2017

February 21, 2017

(Date of agreement on purchase and sale oftrust beneficiary interest in real estate)(Date of agreement on purchase and sale of realestate)Date of agreement

March 17, 2017
Date of acquisition(Date of delivery of trust beneficiary interestin real estate)

March 31, 2017 (Date of delivery of real estate)

SellerUndisclosed (Note 4)

Undisclosed (Note 4)

Financing

Financed with borrowings

Financed with borrowings(Note 1) Location (registry), Completion Date, Structure, and Area are based on the information in the real estate registry.
(Note 2) Concerning location of the Property, Street has not been officially indicated.
(Note 3) The amount excluding acquisition related costs, property tax, city planning tax, consumption tax and local
consumption tax is stated.
(Note 4) Undisclosed, since concent have not obetained from the seller.

- 10 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

NMF decided to acquire the assets stated below on March 21, 2017, and concluded the acquisition on
March 31, 2017.
The properties to be acquired will be acquired using cash on hand and borrowings after settling a
portion of the acquisition price with proceeds from the NOF Nihonbashi Honcho building(51.0%) the
Fund is selling.
Property name

NRE Kichijoji Building (additional stakeacquisition) (Note 1)

Landport Kashiwa ShonanⅠ

Type of asset

Trust beneficiary interest in real estate

Real estate(Registry)
2-2017-216 Kichijoji Honcho, Musashino City,(Registry)
1027-15 Aza-miyagohara, Washinoya, Kashiwa

Tokyo and 10 other lots
(Street)City, Chiba and 1 other lot(Street)2-2-17 Kichijoji Honcho, Musashino City,Tokyo

1027-15 Washinoya, Kashiwa City, Chiba(Note 3)Structure (Note 2)

SRC B2/7F

S 3F

Land area (Note 2)

923.73㎡ (Note 4)

28,029.31㎡

Floor area (Note 2)

5,550.35㎡ (Note 4)

49,394.87㎡

Type of ownership(Land) Ownership（49.0％）（Note 5）
(Building) Ownership（49.0％）（Note 5）(Land) Ownership(Building) Ownership

July 10, 2014

January 29, 2016

¥5,100 million¥9,900 million

March 21, 2017
(Date of agreement on purchase and sale ofMarch 21, 2017
(Date of agreement on purchase and sale oftrust beneficiary interest in real estate)real estate)

Location (Note 2)Completion date
(Note 2)Acquisition price(Note 6)
Date of agreement

March 31, 2017
Date of acquisition(Date of delivery of trust beneficiary interest inreal estate)

March 31, 2017(Date of delivery of real estate)

Seller

Nomura Real Estate Development Co., Ltd.

Nomura Real Estate Development Co., Ltd.

- 11 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Property name

Proud Flat Omori Ⅲ

Proud Flat KinshichoType of asset

Real estate

Real estate(Registry)(Registry)
1-8-7 Kotobashi, Sumida Ward, Tokyo and 1

Location (Note 2)

6-107-3 Minamioi, Shinagawa Ward, Tokyo(Street)6-5-14 Minamioi, Shinagawa Ward, Tokyo

other lot
(Street)1-12-9 Kotobashi, Sumida Ward, Tokyo

Structure (Note 2)

RC, 8FRC, 13F

Land area (Note 2)

526.83㎡

175.86㎡

Floor area (Note 2)

1,742.08㎡

1,259.73㎡

Type of ownership(Land) Ownership(Building) Ownership(Land) Ownership(Building) Ownership

Completion date
(Note 2)October 15, 2014

December 19, 2014

Acquisition price(Note 6)

¥1,110 million¥785 million

March 21, 2017

March 21, 2017

Date of agreement(Date of agreement on purchase and sale ofreal estate)(Date of agreement on purchase and sale ofreal estate)

Date of acquisition

March 31, 2017(Date of delivery of real estate)

March 31, 2017(Date of delivery of real estate)

Seller

Nomura Real Estate Development Co., Ltd.

Nomura Real Estate Development Co., Ltd.

(Note 1) The percentage of ownership shown, 49.0%, is the quasi co-ownership stake in a beneficial interest in a real estate trust
for this property that the Fund acquired. Together with the 51.0% quasi co-ownership stake in a beneficial interest in thereal estate trust acquired by the Fund on October 30, 2015, this acquisition will make the Fund the sole owner of thebeneficial interest in the real estate trust.
(Note 2) Location (registry), Completion Date, Structure and Area are based on the information in the real estate registry.
(Note 3) Concerning location of the Property, Street has not been officially indicated.
(Note 4) The Property’s total land area and the building’s total floor area are given.
(Note 5) The percentage of ownership shown, 49.0%, is the quasi co-ownership stake in a beneficial interest in a real estate trust
for this property that the Fund acquired.
(Note 6) The amount excluding acquisition related costs, property tax, city planning tax, consumption tax and local consumption
tax is stated.

B. Resolutions to Be Considered at the First Unitholders’ Meeting
At the first Unitholders’ Meeting, scheduled for May 26, 2017, NMF plans to propose the election of
one executive director and two supervisory directors. In addition, NMF plans to propose amendments
to the Articles of Incorporation to allow the leasing of assets under management other than real estate,such as renewable energy generation equipment acquired by NMF. NMF also plans to propose
amendments to the Articles of Incorporation to allow the adoption of asset management fees that arelinked to net income for each fiscal period; the reduction of existing asset management fees that arelinked to total assets; and the implementation of necessary adjustments to other articles.

- 12 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Assumptions Underlying Earnings Forecasts for the 4th Fiscal Period (Ending August 31, 2017)
Item
Calculation period

Assumptions
・4th fiscal period: March 1, 2017 to August 31, 2017

・Of the 276 properties held by NMF as of this document’s publication (hereinafter “thePreviously Acquired Assets”), it is assumed that four properties (“the Assets to Be
Sold”) will be sold by NMF during the 4th fiscal period. Namely, it is assumed that
Tennozu Park Side Building will be sold on May 12, 2017, Mitsubishi Motors Shibuya
and Mitsubishi Motors Suginami on June 1, 2017, and Ito-Yokado Higashi-Narashino
Store on June 5, 2017.
Assets Under Management
・With respect to asset management, it is assumed that the Assets to the Sold will be sold on
the above scheduled sale dates and that there will be no other changes in assets undermanagement (new property acquisitions or sales of portfolio properties) through August
31, 2017.
・The forecasts may be revised due to actual changes in the portfolio or other reasons.
・Rental revenues are estimated based on tenant trends, competitive properties located inadjacent areas and real estate market conditions, among other factors, with theassumption that there exist no arrears or cases of nonpayment with regard to the
Operating revenues
properties.
・Gain on sales of real estate are expected to be ¥1,052 million.
・Real estate rental expenses are expected to be ¥15,841 million.
・It is estimated that a tax amount of ¥2,878 million will be recorded as real estate rental
expenses. In general, previous owners are reimbursed for the property taxes and city
planning taxes for the period starting from the time NMF acquires the assets. However,
NMF does not allocate such reimbursement as its expenses, because an amountequivalent to such reimbursement is included in the cost of acquisition and is capitalized.
・Property management costs of ¥3,179 million are estimated to be recorded as real estate
rental expenses.
Operating expenses
・Expenses for repairs and maintenance required for the fiscal period are calculated as real(excluding amortization
estate rental expenses, based on the mid-to-long term repair plans that NMF’s Asset
expenses for goodwill)
Management Company has established. However, the actual expenses for repairs andmaintenance for the fiscal period may differ significantly from estimates due to expenses
for urgent repairs of damages to a building caused by events difficult to foresee,
significant year-on-year fluctuations in costs or non-periodic repair expenses.
・Depreciation of ¥4,951 million is expected to be recorded as real estate rental
expenses.
・Other operating expenses (including asset management fees, asset custody fees andgeneral administration fees) are estimated at ¥3,994million.
・Goodwill will be amortized using the straight-line method over 20 years pursuant to theBusiness Combination Accounting Standards. Goodwill amortization expenses are
expected to be ¥2,622 million.
Amortization expenses ・Goodwill amortization expenses is an item that causes a difference between accounting
for goodwill
and tax treatment and may result in the imposition of corporation tax or other tax.
NMF intends to make distributions in excess of net income for the purpose of securing
tax relief during the goodwill amortization period, and it is expected that NMF will beable to avoid such taxation.
・Interest expenses and other borrowing-related expenses are estimated to be ¥2,627
Non-operating expenses
million.
・As of today, the outstanding interest-bearing liabilities of NMF are ¥525,484 million,
consisting of ¥502,984 million in outstanding borrowings and ¥22,500 million inInterest-bearing liabilities
investment corporation bonds.
・Of the portion of the borrowings (¥40,112 million) that will come due by August 31,- 13 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Item

Assumptions

2017 (the end of the 4th fiscal period), it is assumed that NMF will repay ¥42 million asscheduled using cash on hand, repay ¥5,000 million early and refinance the entire
remaining amount through borrowings.
In addition, it is assumed that a portion of borrowings, separate from that mentioned
above, will be repaid early using proceeds from the sale of the Assets to Be Sold.
・It is assumed that, through August 31, 2017 (the end of the 4th fiscal period), there will
be no changes in the amount of the outstanding interest-bearing liabilities, other thanthose stated above.
・NMF assumes that there will be no changes in the number of investment units issued
and outstanding as of the date of the publication of this document, 4,183,130 units,
Investment units
and there will be no additional issuance of new investment units through August 31,
2017 (the end of the 4th fiscal period).
・The distribution per unit is calculated according to the distribution policy outlined in
NMF’s Articles of Incorporation.
・NMF assumes that, of the allowance for temporary difference adjustments (hereinafter“ATA”) accrued up to the present, the amount eliminated in the 4th fiscal period (¥336
million) will be reversed from retained earnings at end of period.
・NMF assumes that there will be no change in the 4th fiscal period to the ¥1,545 million
Distribution per unit
in deferred losses on hedges of interest rate swaps recorded under valuation andtranslation adjustments continuing from the 3rd fiscal period (ended February 28,2017). The per-unit distribution (excluding the distribution in excess of net income perunit) is calculated by subtracting this amount from the distributable amount.
・The per-unit distribution may vary due to various factors, including changes in theinvestment portfolio, changes in rent income caused by tenant replacements, andunforeseen repairs.
・The amount of distribution in excess of net income is estimated on the assumption NMF
will distribute the amount of valuation and translation adjustments deducted from thetotal difference between accounting and tax treatment and the distributable amount as
ATA for the purpose of tax relief. The estimate is based on the assumption that, inorder to alleviate the impact on distributions of the amortization of goodwill and othermerger-related expenses (the “Merger Expenses”) and the reversal of ATA, if the total
difference between accounting and tax treatment and for the relevant fiscal period is lessthan the sum of the Merger Expenses and the reversal of allowance for temporary
difference adjustments, NMF will make other distributions in excess of net income in an
Distribution per unit inamount not exceeding this difference and within the limit prescribed by the regulations
excess of earnings perof the Investment Trusts Association, Japan (the “Investment Trusts Association Japan
unit
Regulations”) (the amount equivalent to 60/100 of the total amount of accumulated
depreciation recorded as of the end of the relevant fiscal period less the total amount ofaccumulated depreciation recorded as of the end of the immediately preceding fiscal
period).
・In the current forecast, the final distribution in excess of net earnings per unit for the 4th
fiscal period is expected to be ¥455 (all of which will be other distributions in excess of
net earnings), calculated as ¥626 per unit corresponding to amortization of goodwill,less ¥251 per unit corresponding to gain on sales of real estate, plus ¥80 per unit
corresponding to reversal of ATA.
・It is assumed that there will be no amendments in legislation, taxation, accounting
principles, listing requirements, the regulations of the Investment Trusts Association,
Other
Japan or other laws or regulations that would affect the above forecasts.
・It is assumed that there will be no unexpected material changes in general economic
conditions and real estate markets.

- 14 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

3. Financial Statements(1) Balance Sheet
Thousands of Yen
As of August 31, 2016

As of February 28, 2017

Cash and bank deposits

63,889,766

59,843,132

Cash and bank deposits in trust

11,380,801

13,487,906

Rental receivables

592,581464,183

Prepaid expenses

567,043

722,575

1,423－
147,670

AssetsCurrent assets

Income taxes receivable
Consumption taxes receivable－
613,024

Other
Allowance for doubtful accounts
Total current assets

514,880(54)
77,044,586

75,180,347

106,067,919

112,383,669(3,082,914)
102,985,005)(4,798,964)
107,584,705)－

Noncurrent assets
Property and equipment
Buildings
Less accumulated depreciation
Buildings, net
Structures

291,094

350,886

Less accumulated depreciation(61,840)(98,717)Structures, net

229,254

252,168

569,897591,581Less accumulated depreciation(109,415)(172,580)

Machinery, net

460,482

419,001

82,495

109,030(5,002)(13,537)

Machinery

EquipmentLess accumulated depreciation

77,493

95,493Land

Equipment, net

185,217,460

193,986,142

Buildings in trust

163,521,989

195,623,428

Less accumulated depreciation(11,209,810)(14,025,227)

Buildings in trust, net

152,312,178

Structures in trust*3

181,598,200

927,631

941,049

Less accumulated depreciation(489,080)(560,164)

Structures in trust, net

438,551

380,885

Machinery in trust

128,437

168,606

Less accumulated depreciation(7,149)(14,365)

Machinery in trust, net

121,287

154,240

Tools, furniture and fixtures in trust

297,186

388,097

Less accumulated depreciation(38,082)(68,628)

Tools, furniture and fixtures in trust, net

259,103319,468

Land in trust

331,066,945

Leased assets

24,49424,494

Less accumulated depreciation(7,367)(11,386)

Leased assets, net

17,127

13,108Construction in progress

838,601

22,179- 15 -*3

435,437,175

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Thousands of Yen
Total property and equipment

As of August 31, 2016

As of February 28, 2017774,023,490

920,262,769

Intangible assets
Goodwill

74,305,825

98,698,194

Leasehold rights

951,943

951,943

Leasehold rights in trust

7,540,896

7,629,150

32,72436,867

82,831,390

107,316,156

Other
Total intangible assets
Investments and other assets
Long-term prepaid expenses

1,005,941

1,600,245

Long-term deposits

89,385533,241

Security deposits

946,803

956,753

Derivatives Assets-

108,6122,042,131

3,198,853

858,897,012

1,030,777,780

22,41021,03822,41021,038935,964,009

1,105,979,166

Total investments and other assets
Total noncurrent assets
Deferred assets
Investment corporation bond issuance costs
Total deferred assets
Total assets- 16 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

As of August 31, 2016
Liabilities
Current liabilities
Trade accounts payable
Short-term debt
Current portion of investment corporation bonds
Current portion of long-term debt
Lease obligations in trust
Other accounts payable
Accrued expenses
Accrued income taxes
Accrued consumption taxes
Rent received in advance
Unearned revenue
Derivatives liabilities
Other current liabilities
Total current liabilities
Long-term liabilities
Investment corporation bonds
Long-term debt
Lease obligations in trust
Long-term advances received
Security deposits from tenants
Security deposits from tenants in trust
Derivatives liabilities
Total long-term liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
SurplusCapital surplus
Deductions from capital surplus
Allowance for temporary difference adjustments
Other deductions from capital surplus
Total deduction from capital surplus
Capital surplus, net
Retained earnings
Total surplus
Total unitholders' equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Valuation and translation adjustments
Total net assets
Total liabilities and net assets

2,562,467*1*1－
10,000,000*4*2- 17 -

Thousands of Yen
As of February 28, 2017

2,410,374
5,000,000
9,000,000

47,805,600
8,651
2,226,124
330,953605
530,465
4,320,065
341,706
73,217
292,886
68,492,744

69,975,600
8,651
2,294,599
361,542
1,549

22,500,000
329,466,200
9,721
671,420
8,558,771
24,772,441
2,181,236
388,159,791
456,652,535

18,500,000
396,308,400
5,395
713,1908,776,373
29,116,596
1,555,380
454,975,337
549,874,755－
5,083,681
366,627
98,865297,925
94,899,417*3

161,120,405

161,883,752

315,299,775

394,012,959(6,137,594)(941,668)*4(5,374,246)(3,800,508)(7,079,263)
308,220,511
12,225,011
320,445,523
481,565,928(9,174,754)
384,838,204
10,928,087
395,766,292
557,650,045(2,254,454)(2,254,454)
479,311,473
935,964,009(1,545,633)(1,545,633)
556,104,411
1,105,979,166*2

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(2) Statement of Income and Retained Earnings

Operating revenues
Rental revenues
Other rental revenues
Gain on investments in silent partnership
Gain on sales of real estate
Total operating revenues
Operating expenses
Real estate rental expenses
Loss on sales of real estate
Impairment loss
Asset management fees
Asset custody fees
Administrative service fees
Directors' compensation
Merger expenses
Amortization of goodwill
Other operating expenses
Total operating expenses
Operating profit
Non-operating revenues
Interest income
Reversal of dividends payable
Interest on refund
Other non-operating revenues
Total non-operating revenues
Non-operating expenses
Interest expenses

Previous period
from Mar. 1, 2016
to Aug. 31, 2016
*1
*1
*3

*1
*4

26,844,872
2,687,507
1,899
1,442,275
30,976,554*1*1

31,730,411
2,984,567－－
34,714,97813,489,928
329,201－
2,565,116
48,379147,697
7,200
375,501
1,946,877
383,983
19,293,886
11,682,668*1

15,791,521－
269,797
2,783,114
48,740155,545
7,200
1,374,890
2,622,242
417,131
23,470,183
11,244,795

309
4,081

Interest expenses on investment corporation bonds
Amortization of investment corporation bondissuance costs
Loan arrangement fees
Other non-operating expenses
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes—current
Total income taxes
Net income
Retained earnings brought forward
Retained earnings at end of period- 18 -

Thousands of Yen
Current period
from Sep. 1, 2016
to Feb. 28, 2017

*2

－
40
4,431

357
23,390
1
82
23,832

1,714,122
284,082

1,886,020
279,332

1,372

1,372

324,255
6,680
2,330,513
9,356,586
9,356,586
605
605
9,355,981
2,869,030
12,225,011

423,7825,560
2,596,068
8,672,559
8,672,559
1,604
1,604
8,670,955
2,257,132
10,928,087

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(3) Statement of Changes in Net Assets
Previous period (from March 1, 2016 to August 31, 2016)

Unitholders'
capitalBalance at the beginning of
the period
Changes of items during
the period
Distributions ofretained earnings
Distributions in excess
of net earnings fromallowance for temporary
difference adjustments
Other distributions inexcess of net earnings

Capitalsurplus161,120,405

315,299,775

－

－

－

315,299,775

－

－

－

－

－

－

－

－

(6,137,594)－(6,137,594)(6,137,594)

－

－

－

(941,668)(941,668)(941,668)

－

－

－

－

－

－

－

－

－

－

－

－

－

－

(6,137,594)(941,668)(7,079,263)(7,079,263)(*1)161,120,405

315,299,775(6,137,594)(941,668)(7,079,263)

308,220,511

Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodThousands of Yen
Unitholders' equity
SurplusCapital surplus
Total deduction from capital surplus
Allowance
Deduction
Total
Net capitalforfrom otherdeduction
surplustemporary
capitalfrom capitaldifference
surplussurplusadjustment

Valuation and translation
adjustments

Unitholders' equity
SurplusRetainedearnings
Balance at the beginning of
the period
Changes of items during
the period
Distributions ofretained earnings
Distributions in excess
of net earnings fromallowance for temporary
difference adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodTotal surplus

Totalunitholders'equityDeferred
gains orlosses onhedgesValuationandtranslation
adjustments

Total net
assets

4,048,907

319,348,682

480,469,087(2,867,594)(2,867,594)

477,601,492(1,179,877)(1,179,877)(1,179,877)－－(1,179,877)－(6,137,594)(6,137,594)－－(6,137,594)－(941,668)(941,668)－－(941,668)

9,355,981

9,355,981

9,355,981－－

9,355,981－－－

613,140

613,140

613,140

8,176,103

1,096,840

1,096,840

613,140

613,140

1,709,981

12,225,011

320,445,523

481,565,928(2,254,454)(2,254,454)

479,311,473- 19 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Current period (from September 1, 2016 to February 28, 2017)

Unitholders'
capitalBalance at the beginning of
the period
Changes of items during
the period

315,299,775(6,137,594)(941,668)(7,079,263)

308,220,511－

78,713,184

－

－

－

78,713,184

－

－

－

－

－

－

763,347－

763,347(763,347)

－

－

－

－

－

(2,095,491)(2,095,491)(2,095,491)

－

－

－

－

－

－

－

－

－

－

－

－

763,347

78,713,184

763,347(2,858,839)(2,095,491)

76,617,692(*1)161,883,752

394,012,959(5,374,246)(3,800,508)(9,174,754)

384,838,204

Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodCapitalsurplus161,120,405

Increase by merger
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Other distributions inexcess of net earnings

Thousands of Yen
Unitholders' equity
SurplusCapital surplus
Total deduction from capital surplus
Allowance
Deduction
Total
Net capitalforfrom otherdeduction
surplustemporary
capitalfrom capitaldifference
surplussurplusadjustment

Valuation and translation
adjustments

Unitholders' equity
Surplus

Balance at the beginning of
the period
Changes of items during
the period
Increase by merger
Distributions ofretained earnings
Reversal of allowancefor temporary difference
adjustments
Other distributions inexcess of net earnings
Net income
Net changes of items
other than unitholders’equityTotal changes of items
during the period
Balance at the end of theperiodTotalunitholders'equityDeferred
gains orlosses onhedgesValuationandtranslation
adjustments

Total net
assetsRetainedearnings

Total surplus

12,225,011

320,445,523

481,565,928(2,254,454)(2,254,454)

479,311,473－

78,713,184

78,713,184－－

78,713,184(9,204,530)(9,204,530)(9,204,530)－－(9,204,530)(763,347)(763,347)

－

－

－

－

－

(2,095,491)(2,095,491)－－(2,095,491)

8,670,955

8,670,955

8,670,955－－

8,670,955－－－

708,820

708,820

708,820(1,296,923)

75,320,768

76,084,116

708,820

708,820

76,792,937

10,928,087

395,766,292

557,650,045(1,545,633)(1,545,633)

556,104,411- 20 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(4) Statement of Cash Distributions
Yen
Previous period
from Mar. 1, 2016
to Aug. 31, 2016
12,225,011,401

Current period
from Sep. 1, 2016
to Feb. 28, 2017
10,928,087,899

II. Distributions in excess of retained
earnings
Of which, allowance fortemporary difference adjustments
Of which, other distributions inexcess of net earnings

2,095,491,630

3,994,889,150－

2,702,301,980

2,095,491,630

1,292,587,170

III. Incorporation into unitholders'capital
Of which, reversal of allowancefor
temporarydifference
adjustments

763,347,909
763,347,909

708,820,764
708,820,764

IV. Distributions[Distributions per unit]
Of which, distributions of earnings[Of which, distributions ofearnings per unit]
Of which, allowance temporary
difference adjustments[Of which, distributions in excess
of retained earnings per unit [ofallowance for temporary difference
adjustments] ]Of which, other distributions inexcess of net earnings[Of which, distributions in excess
of retained earnings per unit [ofother distributions in excess of net
earnings] ]11,300,022,360(3,036)
9,204,530,730(2,473)

12,666,517,640(3,028)8,671,628,490(2,073)－2,702,301,980

－

(646)

2,095,491,630

1,292,587,170

(563)

(309)

V. Retained earnings carried forward

2,257,132,762

1,547,638,645

Calculation method for distributions

Concerning distributions for the 2nd
fiscal period, NMF decided the
distribution per unit will be ¥3,036.
In order to maximize the distributionof earnings included in deductible
expenses by applying special measures
for tax treatment (Article 67-15
Paragraph 1 of the Act on Special
Measures Concerning Taxation (Act No.
26 of 1957)), NMF decided to distributealmost the entire amount of income as
stipulated in Article 136 Paragraph 1 ofthe Investment Trust Act less reversal of
allowance for temporary difference
adjustments (as stipulated in Article 2
Paragraph 2 (30) of the Calculation Rules
for Investment Corporations), excluding
the portion for which per-unit
distributions would be less than ¥1.
Accordingly, NMF declared an earnings
distribution per investment unit of¥2,473. This amount excludes the
distribution in excess of earnings
discussed below.
In accordance with the distribution
policy stipulated in the Articles ofIncorporation and in consideration of
the impact that such costs related to theConcerning distributions for the 3rd
fiscal period, NMF decided the
distribution per unit will be ¥3,028.
In order to maximize the distributionof earnings included in deductible
expenses by applying special measures
for tax treatment (Article 67-15
Paragraph 1 of the Act on Special
Measures Concerning Taxation (Act No.
26 of 1957)), NMF decided to distributealmost the entire amount of income as
stipulated in Article 136 Paragraph 1 ofthe Investment Trust Act, less thereversal of allowance for temporary
difference adjustments (as stipulated in
Article 2 Paragraph 2 (30) of theRegulations Concerning Accounting ofInvestment Corporations, the same
applies hereinafter), excluding the
portion for which per-unit distributions
would be less than ¥1. Accordingly,
NMF declared an earnings distribution
per investment unit of ¥2,073. This
amount excludes the distribution inexcess of earnings discussed below.
In accordance with the distribution
policy stipulated in the Articles ofIncorporation and in consideration of

I. Retained earnings at end of period- 21 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

merger as goodwill amortization costs,
net assets deductions (as described in
Article 2 Paragraph 2 (30) of theRegulations Concerning Accounting ofInvestment Corporations) and reversal of
allowance for temporary difference
adjustments(excluding
net
asset
deductions; hereinafter referred to
together with goodwill amortization costs
and other costs related to the merger as“merger-related costs”) will have on
distributions, NMF will make a
distribution in excess of earnings in an
amount that it determines equivalent to
the merger-related costs (hereinafter“distribution in excess of earnings”).
When implementing a distribution inexcess of earnings, if the period’s
distribution of allowance for temporary
difference adjustmentsis less than theamount of merger-related costs, other
distributions in excess of net earnings
will also be implemented.
For the fiscal period under review,
NMF decided to implement ¥2,095
million in distributions in excess ofearnings. This figure is equivalent to thesum of ¥1,946 million in goodwill
amortization expenses and ¥150 million
in reversal of allowance for temporary
difference adjustments (excluding net
asset deductions). All of this will be
implemented as ¥2,095 million of other
distributions in excess of net earnings.
Other distributions in excess of net
earnings per unit will be ¥563.

- 22 -

the impact that such costs related to themerger of the three REITs that created
NMF and the absorption type merger
with
TOP
REIT
as
goodwill
amortization costs, net asset deductions(as described in Article 2 Paragraph 2(30) (b) of the Regulations Concerning
Accounting of Investment Corporations)and the reversal of allowance fortemporarydifference
adjustments(excluding
net
asset
deductions;
hereinafter referred to together withgoodwill amortization costs and othercosts related to the merger of the three
REITs and absorption type merger withTOP REIT as “merger-related costs”)
will have on distributions, NMF will
make a distribution in excess of earnings
in an amount that it determines
equivalent to the merger-related costs(hereinafter “distribution in excess ofearnings”). When implementing a
distribution in excess of earnings, if theperiod’s distribution of allowance fortemporary difference adjustments is lessthan the amount of merger-related costs,
other distributions in excess of net
earnings will also be implemented.
For the fiscal period under review,
NMF decided to implement ¥3,994
million in distributions in excess ofearnings. This figure is equivalent toalmost the entire sum (excluding the
portion for which per-unit distributions
would be less than ¥1) of ¥2,622 million
in goodwill amortization and ¥1,374
million in fees paid to the AssetManagement
Companyfortheabsorption type merger with TOP REIT.
Of this, ¥2,702 million will be
distributions of allowance for temporary
difference adjustments, for a per-unit
distribution of allowance for temporary
difference adjustments of ¥646. Other
distributions in excess of net earnings
will be ¥1,292 million; other distributions
in excess of net earnings per unit will be¥309.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(5) Statement of Cash Flows
Previous period
from Mar. 1, 2016
to Aug. 31, 2016

Thousands of Yen
Current period
from Sep. 1, 2016
to Feb. 28, 2017

Cash flows from operating activities
Income before income taxes
Depreciation
Impairment loss
Amortization of goodwill
Amortization of investment corporation bond issuance
costs
Interest income
Interest expenses
Loss on disposal of property and equipment
Increase (decrease) in allowance for doubtful accounts
Decrease (increase) in rental receivables
Decrease (increase) in prepaid expenses
Decrease (increase) in consumption taxes receivable
Decrease (increase) in long-term prepaid expenses
Decrease (increase) in long-term deposits
Increase (decrease) in trade accounts payable
Increase (decrease) in other accounts payable
Increase (decrease) in accrued consumption taxes
Increase (decrease) in accrued expenses
Increase (decrease) in rent received in advance
Decrease in property and equipment due to sales

9,356,586
4,207,238－
1,946,877
1,372
(309)
1,998,205
5,165－(157,024)(137,372)－(263,149)－
399,866
150,152
389,764
15,791(74,217)
9,423,684

8,672,559
4,757,915
269,797
2,622,242
1,372
（357)
2,165,353
5,259
(54)
176,867
87,776(147,670)(227,233)
3,407(466,025)(106,693)(698,979)(144,522)(599)－

Decrease in property and equipment in trust due to sales

23,127,269

－

Other
SubtotalInterest received
Interest paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Payments for purchase of property and equipment
Payments for purchase of property and equipment in trust(36,942)
50,352,959
309(2,187,967)(2,382)
48,162,919

184,451
17,154,866
357(2,383,092)
367
14,772,499(22,049,662)(11,255,557)(6,723,627)(2,430,622)(8,037)(7,026)
86,592(998,224)
1,113,158(1,584,236)
584,716
30,780(29,555,567)－(7,949)－(243,608)
436,532(565,829)
458,73850(13,608,247)

6,000,000(15,100,000)
46,530,000(30,822,800)

5,000,000

Payments for purchase of intangible assets
Payments for purchase of intangible assets in trust
Proceeds from withdrawal of investment securities
Reimbursement of security deposits to tenants
Proceeds from security deposits from tenants
Reimbursement of security deposits to tenants in trust
Proceeds from security deposits from tenants in trust
Proceeds from security deposits
Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from short-term debt
Repayment of short-term debt
Proceeds from long-term debt
Repayment of long-term debt
Repayment of investment corporation bonds
Distributions of earnings to unitholders－(1,189,881)- 23 -－
42,950,000(44,055,300)(5,000,000)(10,219,932)

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Distributions in excess of net earnings from allowancefor temporary difference adjustments
Other distributions in excess of net earnings
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents from merger
Cash and cash equivalents at end of period- 24 -(6,137,594)(1,781)(941,668)(1,661,944)
16,945,408
58,325,160－(*1)75,270,568(2,092,349)(13,419,364)(12,255,112)
75,270,568
10,315,582(*1)73,331,038

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(6) Notes Concerning the Going Concern Assumption
Not applicable.

(7) Notes Concerning Significant Accounting Policies
1. Depreciation of
noncurrent assets① Property and equipment (including trust assets)
The straight-line method is adopted.
The useful lives of major property and equipment are as follows:
Buildings
3–70 years
Structures
2–45 years
Machinery
2–10 years
Tools, furniture and fixtures
2–20 years② Intangible assets
The straight-line method is adopted.
Goodwill is amortized using straight-line method over 20 years.
③ Long-term prepaid expenses
The straight-line method is adopted.

2. Deferred investment
corporation bond issuancecosts
3. Allowance for doubtful
accounts
4. Revenue and expenses
recognition

5. Hedge accounting

Deferred investment corporation bond issuance costs are amortized by the straight-line
method over the respective terms of the bonds.
To be ready for possible losses arising from defaults on receivables, the uncollectable amountis estimated and recorded by investigating collectability based on historical loan loss ratios forgeneral receivables and on case-by-case examinations for doubtful receivables.
Accounting for fixed asset tax, etc.
Of the tax amount assessed and determined for fixed asset tax, city planning tax,
depreciable asset tax, etc. on real estate, etc. held by NMF, the method of charging theamount corresponding to the concerned fiscal period to expenses as real estate rental
expenses is adopted.
The amount equivalent to fixed asset tax, etc. for the fiscal year in which the acquisition
date falls paid to the seller as reimbursement upon acquisition of real estate or trust
beneficiary interests in real estate is included in the cost of acquisition of the concerned
real estate and not recorded as expenses. The amount equivalent to fixed asset tax, etc.
included in the cost of acquisition of real estate, etc. was ¥77,205 thousand in theprevious fiscal period, and ¥3,333 thousand in the current fiscal period.
① Method of hedge accounting
Deferred hedge accounting is adopted. For interest-rate swap transactions that meetthe requirements for special treatment, special treatment is adopted.
② Hedging instruments and hedged items
Hedging instruments
Interest-rate swap transactions
Hedged items
Interest on loans③ Hedging policy
NMF conducts derivative transactions for the purpose of hedging risks prescribed in
the Articles of Incorporation in accordance with the Basic Policy on Risk Management.
④ Method for assessing effectiveness of hedging
The effectiveness of hedging is assessed by the correlation between changes in the fairvalue of hedging instruments and hedged items.

6. Other important bases for
preparing financial
statements① Method of accounting for trust beneficiary interests in real estate, etc.
Concerning trust beneficiary interests in real estate, etc., held by NMF, all assets andliabilities within the trust assets as well as all revenues and expenses generated by the trust
assets are recorded under the corresponding items of the Balance Sheet and Statement of
Income and Retained Earnings.
Of the trust assets thus recorded, the following major items are listed as separate itemson the balance sheet.
(1) Cash and bank deposits in trust(2) Buildings in trust; Structures in trust; Machinery in trust; Tools, furniture and fixturesin trust; Land in trust; Leased assets- 25 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

7. Cash and cash equivalents
as stated in the Statementof Cash Flows(3) Leasehold rights in trust(4) Lease obligations in trust(5) Security deposits from tenants in trust② Method of accounting for consumption tax, etc.
Consumption tax and local consumption tax is accounted for using the tax-excluded
method.
However, non-deductable consumption tax, etc., on such items as noncurrent assets is
included in the acquisition costs of individual items.
Cash and cash equivalents in the statement of cash flows consist of cash on hand and cash intrust; deposits and deposits in trust that can be withdrawn at any time; and short-term
investments with a maturity of three months or less from the date of acquisition that arereadily convertible to cash and bear only an insignificant risk of price fluctuation.

(Additional Information)(Notes Concerning Increases in and the Reversal of Allowance for Temporary Difference Adjustments)
Previous period
from Mar. 1, 2015
to Aug. 31, 2016
1. Reasons, related assets and amounts of reversals
Thousands of Yen
Allowance for
Related assets,
temporary
Reasonetc.
difference
adjustments
Land,
Sale
and
(71,187)
buildings, etc. depreciationofproperties for whichmergerexpenses
were recorded
Land,
Sale of properties(79,019)
buildings, etc. for
which
impairment loss wasrecordedDeferred
Changes in fair
(613,140)
gains or losses value of derivatives
on hedges
Total(763,347)
2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Item
Method of reversal
Buildings, etc.
Upon depreciation and sale, thecorresponding amounts are scheduled
to be reversed.
Land
Upon sale, etc., the corresponding
amount is scheduled to be reversed.

Current period
from Sep. 1, 2016
to Feb. 28, 2017
1. Reasons, related assets and amounts of allowance set
aside
Thousands of Yen
Allowance
forRelated assets, etc.
Reasontemporarydifference
adjustments
Goodwill
Amortization
2,622,242
of goodwill
Land, buildings, etc.
Merger1,390,273
expenses
Land, buildings, etc.
Impairment
269,797
loss
Long-term deposits
Shortfallof
15,185reserveforrepairs
Increase—subtotal
4,297,499
Buildings,
building Depreciation(1,302,166)
improvements, etc.
deficiency
equivalent
Unearned revenue, etc.
Write-down of(216,261)
loss on interest
rate swap due
to merger
Other(76,768)－
Decrease—subtotal
Total

Buildings, etc., Upon depreciation and sale, thein trust
corresponding amounts are scheduled
to be reversed.
Land in trust
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
LeaseholdrightsLeaseholdrights in trust
Investment
Upon
redemption,
etc.,
the
securities
corresponding amount is scheduled
to be reversed.
- 26 -(1,595,197)
2,702,301

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(3) Deferred gains or losses on hedges
The amount corresponding to changes in the fair value ofderivatives used as hedging instruments is scheduled to bereversed.

2.

Reasons, related assets and amounts of reversals
Thousands of Yen
Allowance
forRelated assets,
Reasontemporaryetc.
difference
adjustment
Land, buildings, Sale and depreciation －*etc.
of properties for whichmerger expenses wererecordedDeferred gains Changes in fair value (708,820)
or losses on of derivatives
hedges(708,820)
Total*The amount cancelled in the period under review (¥6,319
thousand) is deducted from “Depreciation deficiency equivalent”
under 1., above.

3. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.
(2) Merger expenses
Method of reversal
Item
Buildings, etc. Upon depreciation and sale, thecorresponding amounts are scheduled tobe reversed.
Land
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
Buildings,
Upon depreciation and sale, theetc., in trust
corresponding amounts are scheduled tobe reversed.
Land in trust
Upon sale, etc., the corresponding
amount is scheduled to be reversed.
LeaseholdrightsLeaseholdrights in trust(3) Impairment loss
Upon the sale of the relevant properties, thecorresponding amount is scheduled to be reversed.
(4) Long-term deposits
In principle, long-term deposits are not reversed.
(5) Deferred gains or losses on hedges
The amount corresponding to changes in the fair valueof derivatives used as hedging instruments is scheduled
to be reversed.

- 27 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(8) Notes to Financial Statements(Notes to Balance Sheet)*1. Commitment line agreement① NMF has concluded a commitment line agreement with two lending financial institutions as follows.
Previous period(Aug. 31, 2016)
10,000,000
10,000,000

Committed line of credit
Balance of used line
Balance of unused line

Thousands of Yen
Current period(Feb. 28, 2017)
10,000,000
10,000,000② NMF has concluded a commitment line agreement with five lending financial institutions as follows.
Previous period(Aug. 31, 2016)
40,000,000
40,000,000

Committed line of credit
Balance of used line
Balance of unused line

Thousands of Yen
Current period(Feb. 28, 2017)
40,000,000
5,000,000
35,000,000*2. Minimum net assets as provided in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment
Corporations
Thousands of Yen
Previous period
Current period(Aug. 31, 2016)(Feb. 28, 2017)
50,00050,000*3. Asset offered as collateral and liabilities secured with collateralPrevious period(Aug. 31, 2016)
None.

Thousands of Yen
Current period(Feb. 28, 2017)
Assets offered as collateral are as follows.
Buildings in trust¥3,335,340 thousand
Land in trust¥6,096,368 thousand
Total¥9,431,708 thousand
Liabilities secured by collateral are as follows.
Security deposits fromtenants in trust¥726,648 thousand
Total¥726,648 thousand- 28 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

*4. Allowance for temporary difference adjustments
Previous period (from March 1, 2016 to August 31, 2016)
1. Reasons, related assets and amounts
Thousands of Yen
ReasonInitialamountBalance atthe end of
previous
periodAllowance
set aside
duringperiodAmortization of
goodwill

1,622,397－

1,622,397－

1,622,397－

Merger expenses

2,638,862－

1,568,581－

1,568,581－

Impairment loss

79,019－79,019－79,019－Loss oninterest-rate
swaps
recognized at
the end of the
fiscal period

2,867,594－

2,867,594－

2,867,594－

7,207,875－

6,137,594－

6,137,594－(790,132)

－

－

－

－

－

(97,557)

－

－

－

－

－

(172,304)

－

－

－

－

－

(10,286)

－

－

－

－

－

Decrease –subtotal(1,070,280)

－

－

－

－

－

Total

6,137,594－

6,137,594－

6,137,594－

Related assets,
etc.
Goodwill
Land, buildings,
etc.
Land, buildings,
etc
Deferred gains
or losses onhedgesIncrease –subtotal
Buildings,
building
improvements,
etc.

Investment
corporation bondissuance costs

Unearnedrevenue, etc.
Other

Depreciation
deficiency
equivalent
Investment
corporation
bonds issuancecost
amortization
deficiency
equivalent
Write-down ofloss on interest
rate swap
due to merger-- 29 -

ReversalduringperiodBalance at theReason forend of current
reversal
periodNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.

(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, Upon depreciation or sale, the corresponding amount is scheduled to be reversed.
etc.
Land in trust
Upon sale, the corresponding amount is scheduled to be reversed.
Leasehold rights
Leasehold rights intrust
Investment
Upon redemption, etc., the corresponding amount is scheduled to be reversed.
securities(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount isscheduled to be reversed.

- 30 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Current period (from September 1, 2016 to February 28, 2017)
1. Reasons, related assets and amounts
Thousands of Yen
Related assets,
etc.
Goodwill

ReasonInitialamountBalance atthe end of
previous
periodAllowance
set aside
duringperiodAmortization of
goodwill

1,622,397

1,622,397－

Reversalduringperiod－Land, buildings,
etc.

Merger expenses

2,638,862

1,568,581－(71,187)

Land, buildings,
etc

Impairment loss

79,01979,019－(79,019)

Deferred gains
or losses onhedgesLoss oninterest-rate
swaps
recognized at
the end of the
fiscal period

Balance at theReason forend of current
reversal
period
1,622,397－

Sale ofpropertyand1,497,394
depreciationof merger
expenses
Sale ofproperty on
which－
impairment
wasrecognized

2,867,594

2,867,594－(613,140)

Changes infair value of
2,254,454
derivativetransactions

7,207,875

6,137,594－(763,347)

5,374,246－(790,132)

－

－

－

－

－

(97,557)

－

－

－

－

－

(172,304)

－

－

－

－

－

(10,286)

－

－

－

－

－

Decrease –subtotal(1,070,280)

－

－

－

－

－

Total

6,137,594

6,137,594－(763,347)

5,374,246－

Increase –subtotal
Buildings,
building
improvements,
etc.

Investment
corporation bondissuance costs

Unearnedrevenue, etc.
Other

Depreciation
deficiency
equivalent
Investment
corporation
bonds issuancecost
amortization
deficiency
equivalent
Write-down ofloss on interest
rate swap
due to merger-- 31 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

2. Method of reversal(1) Amortization of goodwill
In principle, amortization of goodwill is not reversed.

(2) Merger expenses
Item

Method of reversal

Buildings, etc.

Upon depreciation or sale, the corresponding amount is scheduled to be reversed.

Land

Upon sale, the corresponding amount is scheduled to be reversed.

Buildings in trust, Upon depreciation or sale, the corresponding amount is scheduled to be reversed.
etc.
Land in trust
Upon sale, the corresponding amount is scheduled to be reversed.
Leasehold rights
Leasehold rights intrust
Investment
Upon redemption, etc., the corresponding amount is scheduled to be reversed.
securities(3) Impairment loss
Upon the sale of the relevant properties, the corresponding amount is scheduled to be reversed.
(4) Deferred gains or losses on hedges
Based on changes in the fair value of derivatives used as hedging instruments, the corresponding amount isscheduled to be reversed.

- 32 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Notes to Statement of Income and Retained Earnings)*1. Breakdown of real estate rental revenues and expenses
Previous period
from Mar. 1, 2016
to Aug. 31, 2016

A. Property related revenues
Rental revenues
Rent revenues
Common area charges
Other rental revenues
Parking revenues
Incidental income
Other miscellaneous revenues
Property related revenues
B. Property related expenses
Real estate rental expenses
Property management costs
Property management fees
Property and other taxes
Utility expenses
Casualty insurance
Repairs and maintenanceLand rents
Depreciation
Other rental expenses
Property related expenses

24,461,221
2,383,650

26,844,872

533,525
2,069,384
84,597

Thousands of Yen
Current period
from Sep. 1, 2016
to Feb. 28, 2017

29,030,375
2,700,036
689,795

2,687,507

2,174,961
119,81129,532,379

1,614,327
874,716
2,315,517
1,711,878
37,635
1,581,098
193,396
4,205,687
955,671

C. Real estate rental profits [A－B]- 33 -

31,730,411

13,489,928
13,489,928
16,042,451

2,984,567
34,714,978

1,692,980
901,769
3,016,773
1,807,086
45,7502,135,499
208,052
4,757,368
1,226,241

15,791,521
15,791,521
18,923,457

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

*2. Impairment loss
NMF recorded impairment loss during the fiscal period under review for the following asset groups.

Property name

Use

Tennozu Park Side Building

OfficeNOF Technoport
Center Building

OfficeKamataType
Land, building
trust, etc.
Land, building
trust, etc.

LocationininImpairment loss
(Thousands ofYen)

Shinagawa-ku, Tokyo

220,723

Ota-ku, Tokyo

49,074

For the purpose of calculating impairment loss, each property is considered an asset group. NMF reached sales
agreements for NOF Technoport Kamata Center Building and Tennozu Park Side Building on December 22, 2016,
and April 4, 2017, respectively. As a result, the properties’ book values were decreased to their respective recoverable
values and the amount of decrease was recorded as impairment loss under operating expenses.
Any impairment loss caused by sales is regarded as having the properties of an operating expense and is therefore
recorded under operating expenses in accordance with Article 48 Paragraph 2 of the Regulations Concerning
Accounting of Investment Corporations.
Also, the recoverable values of the asset groups are measured using the respective net realizable values or values inuse. The net realizable values are calculated by subtracting the expected disposal costs from the actual sale prices. In
the calculation of values in use, the discount rate is not taken into account because the estimated periods of future
cash flows are brief.
*3. Breakdown of gain on sale of real estatePrevious period (from March 1, 2016 to August 31, 2016)
Central
Shintomicho
Building,Toho
Edogawabashi Building, Toshin Meguro
Building, PRIME URBAN Ochiai, PRIMEURBAN Nakano, PRIME URBAN Ekoda,
PRIME URBAN Urayasu II, PRIMEURBAN Yamahana
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

Thousands of Yen

5,350,000
4,983,325
229,442
137,232

This assignment is an assignment to a single assignee under a single purchase agreement.
The purchase price of each property is not disclosed as the assignee’s consent to thedisclosure thereof has not been obtained.
NOF Shinagawa Konan Building, Yokohama
Odori Koen Building, JCB Sapporo Higashi
Building, PRIME URBAN Hatagaya, PRIMEURBAN Sangen Jaya II, PRIME URBAN
Kamikitazawa
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

10,633,000
10,094,760
141,572
396,667

This assignment is an assignment to a single assignee under a single purchase agreement.
The purchase price of each property is not disclosed as the assignee’s consent to thedisclosure thereof has not been obtained.
NOF Nihonbashi Honcho Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

11,270,000
10,449,586
58,772
761,640- 34 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

NOF Minami Shinjuku Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Gain on sales of real estate

2,380,000
2,219,005
14,259146,735*4. Breakdown of loss on sales of real estatePrevious period (from March 1, 2016 to August 31, 2016)
Thousands of Yen

NOF Tameike Building
Proceeds from sales of real estate
Cost of sales of real estate
Other related sales expenses
Loss on sales of real estate

4,500,000
4,804,276
24,924(329,201)

Current period (from September 1, 2016 to February 28, 2017)
Not applicable.

(Notes to Statement of Changes in Net Assets)
Previous period
from Mar. 1, 2016
to Aug. 31, 2016

Current period
from Sep. 1, 2017
to Feb. 28, 2017

Total number of investment units authorized

20,000,000 units

20,000,000 units

Total number of investment units issued and outstanding

3,722,010 units

4,183,130 units*1.Total number of investment units authorized andtotal number of investment units issued and outstanding(Notes to Statement of Cash Flows)*1. Reconciliation of cash and cash equivalents at end of period to balance sheet items
Thousands of Yen
Current period
from Sep. 1, 2017
to Feb. 28, 201759,843,132

Previous period
from Mar. 1, 2016
to Aug. 31, 2016
63,889,766

Cash and bank deposits
Cash and bank deposits in trust

11,380,801

13,487,906

Cash and cash equivalents

75,270,568

73,331,038*2. Important non-cash transactions
Thousands of Yen
Previous period
Current period
from Mar. 1, 2016
from Sep. 1, 2017
to Aug. 31, 2016
to Feb. 28, 2017
Below is a breakdown of the main components of the assets and liabilities transferred from TOP REIT, Inc., as a result of
the merger with said company in the period under review. The increase in capital surplus due to the merger was ¥78,713,184
thousand.
Current assets－

10,701,316

Noncurrent assets－

138,313,333

Total assets－

149,014,649

Current liabilities－

43,815,958

Long-term liabilities－

53,500,119

Total liabilities－

97,316,077- 35 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Notes on Financial Instruments)
1. Matters concerning status of financial instruments(1) Policy for handling financial instruments
NMF procures funds through such means as debt financing, the issuance of investment corporation bonds and theissuance of investment units for the acquisition of real estate related assets. In procuring funds throughinterest-bearing liabilities, NMF adopts the basic financial policy of procuring funds with due consideration forextending the loan period, converting the interest rate to a fixed rate and laddering the repayment dates, etc. forinterest-bearing liabilities.
NMF enters into derivative transactions for the purpose of hedging risks of future interest rates rising and adopts
the policy of not engaging in speculative transactions.
(2) Description of financial instruments and associated risks, and risk management structure
Funds from debt and investment corporation bonds are primarily used to fund the acquisition of real estate-related
assets and to fund the repayment of debts and redemption of investment corporation bonds. These are exposed toliquidity risks of failure to procure alternative funds at the time of repayment or redemption. NMF controls and limits
these risks by diversifying the lending financial institutions it uses, while considering and implementing various
procurement of funds, including the effective use of surplus funds, procuring funds from the capital market throughissuance of investment units. In addition, floating interest rates debt is exposed to risks of the interest rate payablerising. NMF limits the impact that the interest rate payable rising has on NMF’s operations by keeping LTV (ratio ofinterest-bearing liabilities to total assets) at a low level and keeping the ratio of borrowings that are long-term andfixed-rate borrowings at a high level. Furthermore, derivative transactions (interest-rate swap transactions, etc.) areavailable as a hedging instrument for hedging risks of floating interest rates rising and effectively fixing interest rates.
Deposits are made for investing NMF’s surplus funds and are exposed to risks of failure of the financial institutions
that are holding the deposits and other credit risks, but NMF limits the risks by diversifying the financial institutions
that are holding the deposits.
(3) Supplementary explanation on matters concerning fair value, etc. of financial instruments
The fair value of financial instruments, aside from values based on market price, includes values based on reasonablecalculation when there is no market price. Certain assumptions are adopted in the calculation of the concerned values.
Accordingly, there may be cases where the concerned values will vary when different assumptions are adopted. In
addition, concerning the contract amount, etc. of derivative transactions presented in “Notes on Derivative
Transactions” later in this document, the amount itself does not represent the market risk involved in these derivativetransactions.

- 36 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

2. Matters concerning fair value, etc. of financial instruments
The following are the carrying amounts and fair values as of August 31, 2016, and the differences between theseamounts.
Thousands of Yen

Carrying amount(Note 1)
(1) Cash and bank deposits(2) Cash and bank deposits in trust(3) Short-term debt
(4) Current portion of investment
corporation bonds(5) Current portion of long-term debt
(6) Investment corporation bonds(7) Long-term debt
(8) Derivative transactions

Fair value(Note 1)

Amount of difference

63,889,766
11,380,801

63,889,766
11,380,801

－

－

－
－
－

(10,000,000)(10,074,295)

74,295(47,805,600)(22,500,000)(329,466,200)(2,274 ,820)(47,886,883)(24,314,967)(336,081,428)(2,274,820)

81,283
1,814,967
6,615,228－

The following are the carrying amounts and fair values as of February 28, 2017, and the differences between theseamounts.
Thousands of Yen

Carrying amount(Note 1)
(1) Cash and bank deposits(2) Cash and bank deposits in trust(3) Short-term debt
(4) Current portion of investment
corporation bonds(5) Current portion of long-term debt
(6) Investment corporation bonds(7) Long-term debt
(8) Derivative transactions

Fair value(Note 1)

Amount of difference

59,843,132
13,487,906(5,000,000)

59,843,132
13,487,906(5,000,000)－－－(9,000,000)(9,042,508)

42,508(69,975,600)(18,500,000)(396,308,400)(1,563,490)(69,997,721)(19,979,231)(399,857,342)(1,563,490)

22,121
1,479,231
3,548,942－(Note 1) Liabilities are shown in parentheses.
(Note 2) Matters concerning method for calculating fair value of financial instruments and derivative transactions(1) Cash and bank deposits; (2) Cash and bank deposits in trust, (3) Short-term debt
As these are settled within a short period of time, the fair value is approximately the same as the book value and is thus stated at that bookvalue.
(4) Current portion of investment corporation bonds; (6) Investment corporation bonds
The fair value of investment corporation bonds issued by the Company is determined based on their market prices(5) Current portion of long-term debt; (7) Long-term debt
As long-term debt with floating interest rates reflect market interest rates within a short period of time, the fair value is thought to beapproximately the same as the book value and is thus stated at that book value (However, the fair value of long-term debt with floatinginterest rates that is subject to special treatment for interest-rate swaps (please refer to “Notes on Derivative Transactions” later in thisdocument) is based on the method of calculating by discounting the sum total amount of principal and interest accounted for as one
transaction together with the concerned interest-rate swap by the interest rate that is reasonably estimated as being applicable in the event ofdrawdown of a similar debt financing). In addition, the fair value of long-term debt with fixed interest rates is calculated based on the methodof calculating by discounting the sum total amount of principal and interest by the interest rate that is reasonably estimated as being
applicable in the event of drawdown of a similar debt financing.
(8) Derivative transactions
Please refer to “Notes on Derivative Transactions” later in this document.
(Note 3) Redemption of monetary claims scheduled to be due after the date of settlement of accounts (August 31, 2016)

Due within
1 yearCash and bank deposits
Cash and bank deposits in trust
Total

63,889,766
11,380,801
75,270,568

Due after
1 year,within2 years－－－

Due after
2 years,
within3 years－－－

Due after
3 years,
within4 years－－－

Thousands of Yen

Due after
4 years,
within5 years－－－

Due after
5 years－－－

Amount of redemption of monetary claims scheduled to be due after the date of settlement of accounts (February 28, 2017)
Thousands of Yen

Due within
1 yearCash and bank deposits
Cash and bank deposits in trust
Total

59,843,132
13,487,906
73,331,038

Due after
1 year,within2 years－－－- 37 -

Due after
2 years,
within3 years－－－

Due after
3 years,
within4 years－－－

Due after
4 years,
within5 years－－－

Due after
5 years－－－

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Note 4) Amount of repayment of investment corporation bonds, long-term debt and other interest-bearing liabilities scheduled to be due after thedate of settlement of accounts (August 31, 2016)
Thousands of Yen

Due within
1 yearShort-term debt
Investment corporation bonds
Long-term debt
Total－
10,000,000
47,805,600
57,805,600

Due after
1 year,within2 years－
4,000,000
46,505,600
50,505,600

Due after
2 years,
within3 years－－
48,285,600
48,285,600

Due after
3 years,
within4 years－
5,000,000
47,385,600
52,385,600

Due after
4 years,
within5 years－－
49,435,600
49,435,600

Due after
5 years－
13,500,000
137,853,800
151,353,800

Amount of repayment of investment corporation bonds, long-term debt and other interest-bearing liabilities scheduled to be due after thedate of settlement of accounts (February 28, 2017)
Thousands of Yen

Due within
1 yearShort-term debt
Investment corporation bonds
Long-term debt
Total

5,000,000
9,000,000
69,,975,600
83,975,600

Due after
1 year,within2 years－－
51,940,000
51,940,000

Due after
2 years,
within3 years－－
60,685,600
60,685,600

Due after
3 years,
within4 years－
5,000,000
56,655,600
61,655,600

Due after
4 years,
within5 years－－
47,715,600
47,715,600

Due after
5 years－
13,500,000
179,311,000
192,811,000(Notes on Securities)
Previous period (As of August 31, 2016)
Not applicable.
Current period (As of February 28, 2017)
Not applicable.

(Notes on Derivative Transactions)

1. Transactions not subject to hedge accounting
Previous period (As of August 31, 2016)
Not applicable.
Current period (As of February 28, 2017)
Not applicable.
2. Transactions subject to hedge accounting
Previous period (As of August 31, 2016)
The following is the contract amount or the amount equivalent to the principal provided in the contract, etc. as ofthe date of settlement of accounts for each method of hedge accounting.
Method ofhedge accounting
Principal treatment method
Special treatment forinterest-rate swaps

Type ofderivative transaction
Interest-rate swap transaction
Floating receivable
Fixed payable
Interest-rate swap transaction
Floating receivable
Fixed payable

Thousands of Yen
Fair value(Note 2)Main hedged
item

Contract amount (Note 1)
Due after 1 year

Long-term debt

135,300,000

117,600,000(Note 3) (2,274,820)

Long-term debt

114,760,900

101,718,100(Note 4) (2,159,763)

250,060,900

219,318,100(4,434,584)

Total(Note 1) Contract amount is based on notional amount.
(Note 2) Fair value is calculated by the swap counterparty, based on the actual market interest rate, etc.
(Note 3) Out of the fair value, (¥20,365 thousand) is booked as “accrued expenses” on the Balance Sheet.
(Note 4) Out of the fair value, (¥2,159,763 thousand) is not marked to market on the Balance Sheet, due to the adoption of special treatment forinterest-rate swaps.

- 38 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Current period (As of February 28, 2017)
The following is the contract amount or the amount equivalent to the principal provided in the contract, etc. as ofthe date of settlement of accounts for each method of hedge accounting.
Method ofhedge accounting
Principal treatment method
Special treatment forinterest-rate swaps

Type ofderivative transaction
Interest-rate swap transaction
Floating receivable
Fixed payable
Interest-rate swap transaction
Floating receivable
Fixed payable

Thousands of Yen
Fair value(Note 2)Main hedged
item

Contract amount (Note 1)
Due after 1 year

Long-term debt

175,500,000

134,780,000(Note 3) (1,563,490)

Long-term debt

101,739,500

101,696,700(Note 4) (1,399,669)

277,239,500

236,476,700(2,963,160)

Total(Note 1) Contract amount is based on notional amount.
(Note 2) Fair value is calculated by the swap counterparty, based on the actual market interest rate, etc.
(Note 3) Out of the fair value, (¥17,856 thousand) is booked as “accrued expenses” on the Balance Sheet.
(Note 4) Out of the fair value, (¥1,399,669 thousand) is not marked to market on the Balance Sheet, due to the adoption of special treatment forinterest-rate swaps.

(Notes on retirement benefit plans)Previous period (As of August 31, 2016)
Not applicable, as NMF has no retirement benefit system.
Current period (As of February 28, 2017)
Not applicable, as NMF has no retirement benefit system.
(Notes on Business Combination)
Previous period (As of August 31, 2016)
Not applicable.
Current period (As of February 28, 2017)
Business Combination through Acquisition
1． Overview of the Business Combination（1） Name and Line of Business of Aquiree
Name of acquiree
TOP REIT, Inc. (hereinafter “TOP”)

Line of business
Real estate investment trust（2） Main Reasons for the Business Combination
NMF believes that the absorption type merger with TOP presented a rare opportunity for external growth in theheated real estate acquisition market. Furthermore, the absorption type merger with TOP increased NMF’s ratio
of investment in properties for which future internal growth can be expected, specifically properties that are in
upside sectors or located within Tokyo's five central wards. TOP expected that, because the absorption-typemerger would make Nomura Real Estate Group, a general real estate developer, its sponsor, said merger would
promote external growth by reinforcing the property pipeline. Furthermore, TOP expected that the absorption
type merger would significantly diversify its portfolio and thereby improve its income stability. Thus having
reached the shared understanding that the absorption type merger would best increase their respective unitholder
value, NMF and TOP entered into an absorption type merger agreement.
（3） Date of the Business Combination
September 1, 2016（4） Legal Framework of the Business Combination
An absorption type merger with NMF as the surviving corporation and TOP as the absorbed corporation.
（5） Name of the Investment Corporation after the Merger
Nomura Real Estate Master Fund, Inc.
（6） Main Reasons for the Selection of the Acquiring Company
NMF was selected as the acquiring company in accordance with the Accounting Standards for Business
Combinations and other relevant standards based on a comprehensive consideration of such factors as corporate
scale, including each company’s total assets and net income; the ratio of voting rights that would be controlled byeach company’s unitholders after the absorption-type merger; and the composition of the Board of Directors
after the absorption type merger.
2． Period of Performance of Acquiree Included in the Statement of Income and Retained Earnings- 39 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Name of acquiree
TOP

Period of performance
September 1, 2016 to February 28, 2017

3． Acquisition Cost of Acquiree and its Breakdown
Thousands of Yen
Name of acquireeTOP

Acquisition cost
78,713,184

4． Exchange Ratio, Method of Calculation and Number of Investment Units Delivered as Consideration for theAcquisition（1） Exchange Ratio of Investment Units
NMF
TOP
Merger ratio
1.00
2.62
（2） Method of Calculation
Each investment corporation appointed a financial advisor (hereafter “FA”) for the absorption type merger andrequested that said financial advisor perform a financial analysis of the merger ratio. NMF appointed Nomura
Securities Co., Ltd., and TOP appointed Daiwa Securities Co., Ltd. Based on comprehensive consideration ofsuch factors as each corporation’s financial performance, assets and liabilities, and future outlook, as well as the
merits of the absorption type merger for each corporation and the results of the financial analyses conducted by
the two FAs, NMF and TOP reached an agreement with regard to the above merger ratio through careful
negotiation and formed the absorption type merger agreement.
（3） Number of Investment Units Granted
Name of acquireeTOP

Thousands of Yen
Investment units granted asconsideration
461,120

5． Content and Amount of Main Acquisition-Related Expenses
Thousands of Yen
Content
Amount240,000
FA feesAcquisition fees for merger

1,374,890

6． Amount and Cause of Goodwill
Amount of Goodwill¥27,014,612 thousand（1）

Cause of Goodwill
Goodwill was caused by the acquisition of the acquiree, TOP, for ¥78,713,184 thousand (the acquisition price),
which exceeded the market value of its net assets, ¥51,698,571 thousand.

（2）

Method of Goodwill Amortization and the Amortization Period
The goodwill will be amortized by the straight-line method over a period of 20 years.

7． Amounts and Main Content of Assets Accepted and Liabilities Taken from the Business Combination
Thousands of Yen
Current assets
10,701,316
Noncurrent assets
138,313,333
Total assets
149,014,649
Current liabilities
Long-term liabilities
Total liabilities

43,815,958
53,500,119
97,316,077

8． Estimated Impact on the Statement of Income and Retained Earnings for the Fiscal Period under Review Assuming
the Business Combination Was Completed on the Start Date of the Operating Period
There is no impact since the business combination date is the same as the start date of the operating period.

(Notes on Tax Effect Accounting)- 40 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

1. Breakdown of main causes for occurrence of deferred tax assets and deferred tax liabilities
Previous period(August 31, 2016)

Current period(February 28, 2017)

Deferred tax assets(Thousands of Yen)

Accepted valuation difference at merger

12,309,409

24,633,094

Deferred gains or losses on hedges

712,266

488,323

Interest received in advance319,727

339,960

Over-depreciated long-term prepaid expenses

32,211

28,779Denied impairment loss－

85,628

Denied amortization of leasehold right in trust

611

733

Non-deductible accrued enterprise tax－

39

Excess allowance for doubtful accounts

17－

Subtotal deferred tax assets

13,374,242

25,576,558

Valuation allowance(13,374,242)(25,576,558)

Total deferred tax assets－－

Net deferred tax assets－－- 41 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

2. Breakdown of major components that caused significant differences between statutory tax rate and effective tax
rate after application of tax effect accounting
Previous period(August 31, 2016)

Current period(February 28, 2017)32.31%

31.74%

Statutory tax rate
(Adjustments)
Deductible cash distributions
Valuation allowance(8.61%)(41.62%)(30.43%)0.30%

Amortization of goodwill

6.72%

9.60%

Other

0.01％

0.01%

Effective tax rate after application of tax effectaccounting

0.01%

0.02%

(Notes on equity method income and retained earnings, etc.)
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable, as NMF has no subsidiaries or affiliates.

Current period (from September 1, 2016 to February 28, 2017)
Not applicable, as NMF has no subsidiaries or affiliates.

(Notes on Transactions with Related Parties)
1. Parent company and major corporate unitholders
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable.
Current period (from September 1, 2016 to February 28, 2017)
Not applicable.
2. Subsidiaries and affiliates
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable.
Current period (from September 1, 2016 to February 28, 2017)
Not applicable.
3. Fellow subsidiaries
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable.
Current period (from September 1, 2016 to February 28, 2017)
Not applicable.
4. Directors and major individual unitholders
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable.
Current period (from September 1, 2016 to February 28, 2017)
Not applicable.

- 42 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Notes on asset retirement obligations)
Previous period (from March 1, 2016 to August 31, 2016)
Not applicable.
Current period (from September 1, 2016 to February 28, 2017)
Not applicable.

(Notes on Investment and Rental Properties)

NMF owns leasable offices, leasable retail facilities, leasable logistics facilities and leasable residential ,etc(includingland) in Greater Tokyo area and other areas for the purpose of earning revenue from leasing.
The following are the carrying amount, amount of increase (decrease) during the fiscal period and fair value of theseinvestment and rental properties at the end of the fiscal period.
Previous period
from Mar. 1, 2016
to Aug. 31, 2016
Carrying amount
Balance at beginning of period
Amount of increase (decrease) during period
Balance at end of period
Fair value at end of period(Note 1)
(Note 2)

(Note 3)790,306,905(7,849,126)
782,457,778
834,749,000

Thousands of Yen
Current period
from Sep. 1, 2016
to Feb. 28, 2017
782,457,778
146,378,940
928,836,719
996,084,000

Carrying amount is the cost of acquisition less accumulated depreciation.
Of the change in investment and rental properties, the increase during the previous period is mainly attributable to theacquisition of PMO Tamachi (¥6,328,987 thousand), PMO Ginza Hatchome (¥4,025,053 thousand), PMO Shibakoen(¥3,975,082 thousand), Hirakata Kuzuha Logistics Center (¥3,516,505 thousand), PRIME URBAN Meguro Mita(¥1,137,130 thousand), PRIME URBAN Chikusa (¥1,205,712 thousand) and Ryotokuji University Shin-Urayasu Campus(Land) (¥5,125,367 thousand). The decrease during the previous fiscal period is mainly attributable to the sale of NOF
Nihonbashi Honcho Building (¥10,449,586 thousand), NOF Tameike Building (¥4,804,276 thousand), NOF Shinagawa
Konan Building (¥3,471,844 thousand), NOF Minami Shinjuku Building (¥2,219,005 thousand), Central Shintomicho
Building (¥1,328,098 thousand), Toho Edogawabashi Building (¥1,095,234 thousand), Toshin Meguro Building (¥854,458
thousand), Yokohama Odori Koen Building (¥1,806,149 thousand), JCB Sapporo Higashi Building (¥3,266,519 thousand),
PRIME URBAN Hatagaya (¥470,012 thousand), PRIME URBAN Ochiai (¥337,641 thousand), PRIME URBAN Sangen
Jaya II (¥483,603 thousand), PRIME URBAN Kamikitazawa (¥596,632 thousand), PRIME URBAN Nakano (¥468,054
thousand), PRIME URBAN Ekoda (¥408,769 thousand), PRIME URBAN Urayasu II (¥219,614 thousand), and PRIMEURBAN Yamahana (¥271,452 thousand) as well as depreciation (¥4,203,908 thousand). The increase during the current
period is mainly attributable to the acquisition of 19 properties as a result of the absorption type merger with TOP REIT,
Inc. (total of ¥137,495,038 thousand) and the acquisition of Landport Kashiwa Shonan II (¥10,916,634 thousand). The
decrease during the current period is mainly attributable to depreciation (¥4,754,117 thousand).
Fair value at the end of the period is the appraisal value or investigation value determined by investigation, found by anoutside real estate appraiser. However, the scheduled transfer price is used as the fair value for NOF Technoport Kamata
Center Building, NOF Nihonbashi Honcho Building, Tennozu Park Side Building, Mitsubishi Motors Shibuya, Mitsubishi
Motors Suginami and Ito-Yokado Higashi-Narashino Store.

The income (loss) in the previous period (from March 1, 2016 to August 31, 2016) and current period (from September 1,
2016 to February 28, 2017) for investment and rental properties is as presented in “Notes to Statement of Income andRetained Earnings” earlier in this report.
(Notes on Segment Information)(Segment Information)
Since NMF has only one segment, the real estate leasing business, segment information has been omitted.
(Related Information)
Previous period (from March 1, 2016 to August 31, 2016)
1. Information by product and service
Disclosure is omitted, since revenues from external customers of a single product/service category account for morethan 90% of the operating revenues presented on the Statement of Income and Retained Earnings.
2. Information by geographical area
- 43 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(1) Revenues
Disclosure is omitted, since revenues from external customers in Japan account for more than 90% of the operating
revenues presented on the Statement of Income and Retained Earnings.
(2) Property and equipment
Disclosure is omitted, since the amount of property and equipment located in Japan accounts for more than 90% of
the amount of property and equipment presented on the Balance Sheet.
3. Information by major customer

Customer name
Nomura Real Estate Partners
Co., Ltd.

Revenues (Thousands of Yen)

Related segment name4,289,956

Rental real estate businessCurrent period (from September 1, 2016 to February 28, 2017)
1. Information by product and service
Disclosure is omitted, since revenues from external customers of a single product/service category account for morethan 90% of the operating revenues presented on the Statement of Income and Retained Earnings.
2. Information by geographical area
(1) Revenues
Disclosure is omitted, since revenues from external customers in Japan account for more than 90% of the operating
revenues presented on the Statement of Income and Retained Earnings.
(2) Property and equipment
Disclosure is omitted, since the amount of property and equipment located in Japan accounts for more than 90% of
the amount of property and equipment presented on the Balance Sheet.
3. Information by major customer

Customer name
Nomura Real Estate Partners
Co., Ltd.

Revenues (Thousands of Yen)

Related segment name4,499,817

Rental real estate business- 44 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

(Notes on Per Unit Information)
Yen
Previous period
from Mar. 1, 2016
to Aug. 31, 2016

Current period
from Sep. 1, 2016
to Feb. 28, 2017

Net assets per unit

128,777

132,939

Net income per unit

2,513

2,072

(Note 1)
(Note 2)

Net income per unit is calculated by dividing net income by the average number of investment units during the period.
In addition, the diluted net income per unit is not stated, since there are no dilutive investment units.
The following is the basis for calculation of net income per unit.

Previous period
from Mar. 1, 2016
to Aug. 31, 2016

Current period
from Sep. 1, 2016
to Feb. 28, 2017

9,355,981

8,670,955－－

Net income attributable to ordinary investment units (Thousands ofYen)

9,355,981

8,670,955

Average number of investment units during period (Units)

3,722,010

4,183,130

Net income (Thousands of Yen)
Amount not attributable to ordinary unitholders (Thousands of
Yen)(Notes on Significant Subsequent Events)
Asset Sales(1) NMF sold the following asset after the conclusion of the third fiscal period (February 28, 2017).
a. NOF Technoport Kamata Center Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
December 22, 2016
 Transfer date
March 31, 2017
 Transfer price¥5,020 million
 Buyer
A domestic special purpose corporation (tokutei mokuteki kaisha) Impact on 4th fiscal period earnings— (Note)(2) NMF reached an agreement to sell and sold the following asset after the conclusion of the third fiscal period(February 28, 2017).
a. NOF Nihonbashi Honcho Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
March 21, 2017
 Transfer date
March 31, 2017
 Transfer price¥11,730 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 4th fiscal period earnings¥777 million(Scheduled)- 45 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(3) NMF reached agreements to sell the following assets after the conclusion of the third fiscal period (February
28, 2017).
a. Tennozu Park Side Building
 Type of asset
Trust beneficiary interest in mainly real estate Use
Office Contract date
April 4, 2017
 Transfer date (Scheduled)
May 12, 2017
 Transfer price (Scheduled)¥12,700 million
 Buyer
A domestic special purpose corporation (tokutei mokuteki kaisha) Impact on 4th fiscal period earnings— (Note)b. Mitsubishi Motors Shibuya
 Type of asset
 Use
 Contract date
 Transfer date (Scheduled) Transfer price (Scheduled) Buyer
 Impact on 4th fiscal period earnings(Scheduled)

Trust beneficiary interest in mainly real estate
Retail facility (land)
March 31, 2017
June 1, 2017
¥1,720 million
Nomura Real Estate Development Co., Ltd.
¥121 millionc. Mitsubishi Motors Suginami
 Type of asset
 Use
 Contract date
 Transfer date (Scheduled) Transfer price (Scheduled) Buyer
 Impact on 4th fiscal period earnings(Scheduled)

Trust beneficiary interest in mainly real estate
Retail facility (land)
March 31, 2017
June 1, 2017¥896 million
Nomura Real Estate Development Co., Ltd.
¥139 million

The impact of (1) through (3), above, on earnings for the 4th fiscal period (March 1, 2017 to August 31, 2017)
will be recorded as gain on sales of real estate under operating revenues.
(Note) An amount equivalent to the loss on sales of real estate resulting from the sales of NOF Technoport
Kamata Center Building and Tennozu Park Side Building has been recorded as impairment loss. For
details, please refer to “*2. Impairment loss” under “Notes to Statement of Income and Retained
Earnings,” above.
(Additional Information)
Asset Sales(1) NMF plans to sell the following asset after the conclusion of the third fiscal period (February 28, 2017).
a. Ito-Yokado Higashi-Narashino Store Type of asset
Trust beneficiary interest in mainly real estate Use
Retail facility
 Contract date
December 28, 2016
 Transfer date (Scheduled)
June 5, 2017
 Transfer price (Scheduled)¥664 million
 Buyer
Nomura Real Estate Development Co., Ltd.
 Impact on 4th fiscal period earnings¥14 million(Scheduled)- 46 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

The impact of this sale on earnings for the 4th fiscal period (March 1, 2017 to August 31, 2017) will be recorded
as gain on sales of real estate under operating revenues.
[Disclosure Omissions]
A disclosure of notes concerning lease transactions is omitted because such disclosure in this summary offinancial results is judged to be unnecessary.
(9) Increase (Decrease) in Total Number of Investment Units Issued and Outstanding
The following is the increase (decrease) in unitholders’ capital and total number of investment units issued andoutstanding during the period from the date of incorporation of NMF through the end of the current fiscal
period (February 28, 2017).

Date

Description

Total number ofinvestment units
issued and outstanding(Units)Increase
Balance(Decrease)

Unitholders’ capital(Millions of Yen) (Note 1)
Increase(Decrease)

Note

Balance

October 1, 2015

Consolidation typemerger3,722,010

3,722,010

161,120

161,120(Note 2)September 1, 2016

Absorption typemerger461,120

4,183,130－

161,120(Note 3)October 14, 2016

Reversal of Allowancefor temporary
difference adjustments－

4,183,130

763

161,883(Note 4)(Note 1)
(Note 2)
(Note 3)(Note 4)

Figures have been truncated at the nearest million yen.
NMF was established through the consolidation type merger of the former NMF, NOF and NRF on October 1, 2015. Upon its
establishment, NMF allotted 1 NMF unit per former 1.00 NMF unit, 3.60 NMF units per 1.00 NOF unit and 4.45 NMF units per 1.00
NRF unit.
On September 1, 2016, as part of the absorption type merger, NMF issued 2.62 NMF units per 1.00 TOP unit, resulting in the issueof 461,120 new units. There is no change of unitholders’ capital.
At its October 14, 2016 meeting, NMF’s Board of Directors resolved to reverse the allowance for temporary difference adjustments
and incorporate the amount of said reversal into unitholders’ capital.

- 47 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

4. Changes in Directors(1) Changes in NMF Directors
Timely disclosure of changes in directors will be made at the time that details are determined.
There were no changes in directors during the period under review.
However, at the first Unitholder’s Meeting, on May 26, 2017, NMF plans to appoint one executive director,
and two supervisory directors. For details, please refer to the April 14, 2017 release entitled “NoticeConcerning Amendment of the Articles of Incorporation and Election of Directors .”(2) Changes in Asset Management Company Directors and Statutory Auditors
Timely disclosure of changes in directors and statutory auditors will be made at the time that details are
determined.
There were changes in the directors after the 3rd Fiscal Period end (February 28, 2017) stated below.
Please refer to the press release dated March 3, 2017 titled “Notice Concerning Scheduled Amendments of
the Articles of Incorporation, Changes in Organization, and Changes of Directors and Important Employees
in the Asset Management Company” for the details.
Appointments (as of April 1, 2017)
Name
Title (New)
Representative Director andSenior Managing Executive Officer
Supervisor of the Investment
Management Department
Fumiki Kondo
In charge of the Corporate Planning
Department, the International
Business Planning Section and the
Finance & Accounting Department
Director andManaging Executive Officer
In charge of the Client Relations &Noriaki Ido
Marketing Department, the Investment
Management Department and theProduct Development Department

Seiichiro Wada

Resignations (as of March 31, 2017)
Name

Hiroshi Kurokawa

Statutory Auditor

Title (New)(Resignation)- 48 -

Title (Former)(New appointment)

Executive Officer,
General Manager of the Acquisitions
Department
Director and Managing Executive
Officer
In charge of the Client Relations &Marketing Department, the Investment
Management Department and theProduct Management Department

Title (Former)
Representative Director and Senior
Managing Executive Officer
Supervisor of the ProductManagement Department, theAcquisitions Department, theInvestment Management Planning
Department, the NMF Investment
Management Group and the NPR
Investment Management Department
In charge of the Research & Analysis
SectionChief Strategy Officer

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Other changes (as of April 1, 2017)
Name
Title (New)
Representative Director andSenior Managing Executive Officer
Supervisor of the ProductDevelopment Department, the NMF
Investment Management Group andthe NPR Investment Management
Masato Yamauchi
Department
In charge of the Research & Analysis
Department, the Acquisitions
Department and the Investment
Management Planning Department
Chief Strategy Officer

Kenichi Okada

Director and Managing Executive
Officer
Head of the NMF Investment
Management Group- 49 -

Title (Former)

Director andManaging Executive Officer
In charge of the Finance & Accounting
Department
General Manager of the Corporate
Planning Department

Director and Managing Executive
Officer
Head of the NMF Investment
Management Group
General Manager of the AssetManagement Department I of the
NMF Investment Management GroupNomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

5. Reference Information(1) Investment Status
2nd fiscal period
3rd fiscal period
As of August 31, 2016
As of February 28, 2017
Area
As a percentage
As a percentage
Type of asset
Use
Total amount held
Total amount held
(Note 1)of total amount ofof total amount of(Millions of Yen)
(Millions of Yen)
assets (%)
assets (%)(Note 2)
(Note 2)
(Note 3)(Note 3)
Greater Tokyo area
93,75910.0
93,482
8.5
OfficeOther areas
21,8292.3
21,720
2.0
properties
Subtotal
115,58912.3
115,203
10.4
Greater Tokyo area
16,241
1.7
16,172
1.5
Retailproperties
Subtotal
16,241
1.7
16,172
1.5
Greater Tokyo area
10,863
1.0
Logistics
Real estate
properties
Subtotal
10,863
1.0
Greater Tokyo area
122,340
13.1
124,205
11.2
Residential
Other areas
30,625
3.3
31,7082.9
properties
Subtotal
152,965
16.3
155,913
14.1
Greater Tokyo area
5,125
0.5
5,136
0.5
Other
properties
Subtotal
5,125
0.5
5,136
0.5
Greater Tokyo area
176,67218.9
285,379
25.8
OfficeOther areas
50,4785.4
50,512
4.6
properties
Subtotal
227,15124.3
335,892
30.4
Greater Tokyo area
80,828
8.6
91,247
8.3
RetailOther areas
44,5584.845,434
4.1
properties
Subtotal
125,386
13.4
136,68112.4
Real estatein trust
Greater Tokyo area
121,923
13.0
121,141
11.0
Logistics
Other areas
9,569
1.0
9,463
0.9
properties
Subtotal
131,49314.0
130,605
11.8
Greater Tokyo area
7,086
0.8
22,3682.0
Residential
Other areas
1,418
0.2
0
0.0
properties
Subtotal
8,504
0.9
22,3682.0
Subtotal
782,457
83.6
928,836
84.0
Deposits and other assets
153,506
16.4
177,14216.0
935,964
100.0
1,105,979
100.0
Total amount of assets
2nd fiscal period
As of August 31, 2016
As a percentage
Amountof total amount(Millions of Yen)of assets (%)(Note 4)(Note 3)
Total amount of liabilities
Total amount of net assets

3rd fiscal period
As of February 28, 2017
As a percentage
Amountof total amount(Millions of Yen)of assets (%)(Note 4)(Note 3)456,65248.8

456,65248.8

479,31151.2

479,31151.2(Note 1) “Greater Tokyo area” refers to Tokyo, Kanagawa Prefecture, Chiba Prefecture and Saitama Prefecture. “Other areas” refers tocabinet-order-designated cities, prefectural capitals, and cities with a population of 100,000 persons or more as well as surrounding areas ofthese cities that are not included in the Greater Tokyo area.
(Note 2) Total amount held is the carrying amount (in the case of real estate and real estate in trust, the sum total amount of book value, after
depreciation).
(Note 3) The figures are rounded off to first decimal place. Accordingly, the sum may not be exactly 100.0%.
(Note 4) Total amount of liabilities and total amount of net assets are the amounts as stated in the balance sheet as total liabilities and total net assets.

- 50 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017(2) Investment Assets① Major Investment Securities
Not applicable.
② Investment Real Estate Properties
Real estate is listed together with beneficial interests in real estate trusts in ③ Other Major Investment
Assets, below.
③ Other Major Investment Assets
The following summarizes the real estate, etc. (272 properties) held as of February 28, 2017 (end of the
3rd fiscal period) by NMF (this real estate and the beneficiary interests of trusts in which real estate
properties are the principal trust properties or the real estate that constitutes the underlying assets thereof
are hereinafter referred to as the “assets held at the end of the 3rd fiscal period”). Unless otherwise stated,the figures in the tables below are the figures as of February 28, 2017.

- 51 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

A. Overview of Portfolio and Leasing Status and Changes in Occupancy Rate(a) Overview of Portfolio and Leasing Status
The following is an overview of the portfolio and leasing status for the assets held at the end of the
3rd fiscal period.
Number of properties

272

Gross leasable area (m2) (Note 1)

1,968,528.97

Gross leased area (m2) (Note 2)

1,952,102.47

Total number of tenants (Note 3)

1,345

Total of all contracted rent (Thousands of Yen) (Note 4)(Note 1)

5,290,866

The sum total of the “leasable area” of each of the assets held at the end of the 3rd fiscal period. “Leasable area” is the sum total areaof office facilities, retail facilities, logistics facilities, or residential facilities, etc. leasable in each asset (including the area of common-use
space, etc., if leased). Leasable area is calculated based not on that presented in the registry, but the area stated in the lease contract andthe area calculated based on building completion drawings, etc. Accordingly, the leasable area may not be the same as the floor area
based on that presented in the registry and may exceed the floor area. In the case of land with leasehold right, the land area based onthat presented in the registry is used as contracted area. For the Shinjuku Nomura Building, NOF Nihonbashi Honcho Building, NEC
Head Office Building, Musashiurawa Shopping Square and NRE Kichijoji Building, the leasable area is the area calculated by multiplying
the building’s overall leasable area by the quasi co-ownership ratio of the beneficial interest in real estate trust owned by NMF as of theend of the fiscal period. For the NRE Tennozu Building, since the rent under the master lease agreement is calculated as the building’s
overall rent multiplied by the ownership ratio of the common areas, the leasable area is calculated as the building’s overall leasable areamultiplied by the ownership ratio of the common areas. Land with leasehold interest indicates the land area in the registry as contracted
space.

(Note 2)The sum total of “leased area” of each of the assets held at the end of the 3rd fiscal period. “Leased area” is the area that is actuallyleased to an end-tenant (The area stated in the lease contract; provided, however, that such be limited to the area of office properties,
retail properties, logistics properties, or residential properties, etc. (if all rental units are collectively leased, then the area of the entire
rental units) and not include the leased area of parking space, etc. However, if the master lessee has a rent-guaranteed master lease forsome or all rental units, the space is included in leased area regardless of whether or not there is a lease agreement with an end-tenant.)
in each asset. In the case of land with leasehold right, the leased area of the land is shown. For the Shinjuku Nomura Building, NOF
Nihonbashi Honcho Building, NEC Head Office Building, Musashiurawa Shopping Square and NRE Kichijoji Building the leased areais the area calculated by multiplying the building’s overall leased area by the quasi co-ownership ratio of the beneficial interest in realestate trust owned by NMF as of the end of the fiscal period. For the NRE Tennozu Building, since the rent under the master leaseagreement is calculated as the building’s overall rent multiplied by the ownership ratio of the common areas, the leased area is calculated
as the building’s overall leased area multiplied by the ownership ratio of the common areas.

(Note 3)The sum total of “total number of tenants” of each of the assets held at the end of the 3rd fiscal period. In the calculation of “numberof tenants,” when some or all rental units are collectively leased for the purpose of subleasing and the lessee in the lease agreement(master lease agreement) has concluded an agreement with an end-tenant (sublessee that is the actual user) for subleasing the rental units,
the lessee of the master lease agreement is counted as one tenant. However, in the case of assets with a so-called pass-through master
lease agreement, where the rent received from the lessee in the master lease agreement is the same amount as the rent that the lessee
receives from the end-tenant, the total number of end-tenants is shown. In addition, if multiple rental units in a specific asset are leased
to a specific tenant, this is counted as one tenant for the asset and, if multiple assets are leased to a specific tenant, these are counted
separately and the total of that number of tenants is shown. For residential facilities or residential portions of “other” sector facilities,
when some or all rental units are collectively leased for the purpose of subleasing and the lessee in the lease agreement (master leaseagreement) has concluded an agreement with an end-tenant for subleasing the rental units, the lessee of the master lease agreement iscounted as one tenant, and the total number of tenants for the building as whole is shown.

(Note 4)

The total amount of “total contracted rent” for February 2017 of each of the assets held at the end of the 3rd fiscal period (amounts
less than one thousand are truncated). “Total contracted rent” for February 2017 refers to the sum total of monthly rent and common
area charges in lease agreements actually concluded with end-tenants that are valid as of the last day of February 2017 (This does notinclude parking space or other fees stated in parking space lease agreements or other such agreements signed in addition to the tenantlease agreement. If common-use space, etc. is leased based on the lease agreement, the rent for such is included and, if rent includes anamount equivalent to the fee for use of parking space, such amount is included. In addition, if the master lessee has a rent-guaranteed
master lease for some or all rental units, the rent for the space is based on the rent, etc., in the lease agreement concluded with themaster lessee.). Furthermore, regarding tenants who have been exempt from rent payment for a certain period of time in theiragreements, such exemption period is not considered in the table above, and the rent is calculated based on the monthly rent andcommon area charges payable immediately after the exemption period ends. In addition, the standard level of rent is used for tenantswith sales-based rent. For the Shinjuku Nomura Building, NOF Nihonbashi Honcho Building, NEC Head Office Building,Musashiurawa Shopping Square and NRE Kichijoji Building, the total contracted rent is calculated by multiplying the building’s overall
rent revenues by the quasi co-ownership ratio of the beneficial interest in real estate trust owned by NMF as of the end of the fiscal- 52 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

period. For the NRE Tennozu Building, the the total contracted rent is calcuclated as the building’s overall rent revenues multiplied by
the ratio of the common areas that NMF owns through the trustee.

(b) Changes in Occupancy Rate
The following is the changes in the occupancy rate of real estate under management held by NMF.

Portfolio occupancy rate
(at end of fiscal period) (%)

February 29, 2016(end of 1st fiscal
period)August 31, 2016(end of 2nd fiscal
period)February 28, 2017(end of 3rd fiscal
period)

98.9

99.1

99.2

- 53 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

B. Price and Investment Share
The following is an overview of the assets held at the end of the 3rd fiscal period (acquisition price,
carrying amount, opinion of value at end of period, investment share and appraiser).
Use

Area

Greater
OfficeTokyo
area

Acquisition price(Millions of Yen)
(Note 1)

Property nameCarrying amount(Millions of Yen)
(Note 2)

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

Appraiser

Shinjuku Nomura Building (Note5)

43,90045,76048,100

4.8

NRE Tennozu Building

20,50020,497

21,400

2.2

Kojimachi Millennium Garden

26,70026,63627,100

2.7

NOF
Nihonbashi
Building（Note 6）

10,914

10,895

11,3001.1

Tennozu Park Side Building

12,70012,497

12,100

1.2

NMF
Shinjuku
Building

10,000

10,11010,400

1.0

NMF Shibuya Koen-dori Building

10,40010,435

10,600

1.1

Secom Medical Building

11,10011,003

11,100

1.1

NMF Shiba Building

7,040

7,035

7,230

0.7

Nishi-Shinjuku Showa Building

8,140

8,137

8,100

0.8

NRE Shibuya Dogenzaka Building

5,310

5,325

5,470

0.6

Iwamoto-cho Toyo Building

4,050

4,061

4,080

0.4

NMF Surugadai Building

4,690

4,702

4,760

0.5

PMO Nihonbashi Honcho

4,320

4,250

4,630

0.5

PMO Nihonbashi Kayabacho

5,010

4,947

5,310

0.5

NMF Gotanda Ekimae Building

4,430

4,583

4,790

0.5

NRE Higashi-nihonbashi Building

3,570

3,554

3,420

0.3

PMO Akihabara

4,240

4,178

4,720

0.5

Hatchobori NF Building

2,480

2,468

2,550

0.3

NMF
Kanda
Building

4,160

4,194

4,110

0.4

NMF Takanawa Building

2,830

2,823

2,840

0.3

PMO Hatchobori

2,880

2,836

3,080

0.3

PMO Nihonbashi Odenmacho

2,210

2,172

2,470

0.2

PMO Higashi-nihonbashi

1,690

1,660

1,840

0.2

NRE Ueno Building

6,470

6,494

6,490

0.7

NOF Technoport Kamata Center
Building

4,780

4,725

4,550

0.5

NF Hongo Building.

4,890

4,869

5,170

0.5

Crystal Park Building

3,390

3,369

3,420

0.3

NMF Kichijoji Honcho Building

1,780

1,832

1,850

0.2

Faret Tachikawa Center Square

3,850

3,854

4,100

0.4

The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
Appraisal Firm A
Square Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Appraisal Firm A
Square Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.

7,830

7,885

8,450

0.8

Japan Valuers Co., Ltd.

5,460

5,681

6,180

0.6

NMF Shin-Yokohama Building

2,620

2,803

2,920

0.3

PMO Tamachi

6,210

6,278

6,570

0.7

PMO Ginza Hatchome

3,970

4,009

4,240

0.4

PMO Shibakoen

3,900

3,941

4,210

0.4

NEC Head Office Building (Note7)

44,10044,13444,5004.5

HonchoMinamiguchi

Iwamoto-cho

NMF Kawasaki Higashiguchi
Building
NMF
Yokohama
Nishiguchi
Building- 54 -

Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

Acquisition price(Millions of Yen)
(Note 1)

Property name
Harumi Island
Office Tower Y

TritonSquare

Other
areas

RetailGreaterTokyo
area

Investment
share
(%)
(Note 4)

Appraiser
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.

18,181

18,3001.8

10,400

10,398

10,900

1.1

8,330

8,325

8,330

0.8

8,180

8,161

8,140

0.8

Shinkawa Chuo Building

6,070

6,055

6,100

0.6

Shinjuku EAST Building

5,710

5,770

5,790

0.6

Shiba-Koen Building

3,620

3,624

3,680

0.4

Ginza Oji Building

1,850

1,853

1,870

0.2

Faret East Building

1,850

1,842

1,850

0.2

Sapporo North Plaza

6,250

6,331

6,950

0.7

NRE Sapporo Building

4,140

4,022

4,260

0.4

NMF Sendai Aoba-dori Building

2,030

2,119

2,120

0.2

NOF Utsunomiya Building

2,320

2,605

2,210

0.2

NMF Nagoya Fushimi Building

2,240

2,179

2,190

0.2

Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteMorii Appraisal &Investment
Consulting, Inc.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute

NMF Nagoya Yanagibashi Building

2,280

2,278

2,110

0.2

Japan Valuers Co., Ltd.

Omron Kyoto Center Building

18,30018,24718,500

1.9

Japan Real
Institute

SORA Shin-Osaka 21

12,10012,057

12,100

1.2

Japan Valuers Co., Ltd.

NRE Osaka Building

6,100

6,237

6,150

0.6

NRE Nishi-Umeda Building

3,450

3,460

3,610

0.4

NRE Yotsubashi Building

4,000

4,028

4,010

0.4

NRE Hiroshima Building

2,280

2,272

2,510

0.3

NMF Hakata Ekimae Building

4,210

4,205

4,390

0.4

NMF Tenjin-Minami Building

2,230

2,187

2,270

0.2

Office subtotal

448,654451,095

462,490

46.5

Morisia Tsudanuma

16,60017,67517,500

1.8

Yokosuka More’s City

13,64013,72816,000

1.6

Recipe SHIMOKITA

10,407

10,625

10,900

1.1

Kawasaki More’s

6,080

6,599

7,640

0.8

EQUINIA Shinjuku

4,260

4,311

4,770

0.5

EQUINA Ikebukuro

3,990

4,072

4,470

0.4

covirna machida

3,440

3,724

4,320

0.4

Nitori Makuhari

3,080

2,900

3,670

0.4

Konami Sports Club Fuchu

2,730

2,614

3,340

0.3

FESTA SQUARE

2,600

2,434

3,090

0.3

GEMS Shibuya

2,490

2,457

2,610

0.3

Sundai Azamino

1,700

1,600

2,020

0.2

EQUINIA Aobadai

1,560

1,618

1,840

0.2

Megalos Kanagawa

1,000

989

1,360

0.1

Mitsubishi Motors Meguro

2,740

2,764

3,110

0.3

Kanda
Building

OfficeOpinion of value
at end of period(Millions of Yen)
(Note 3)

18,200Akasaka Oji Building

GreaterTokyo
area

Carrying amount(Millions of Yen)
(Note 2)

Nishiki-cho

Harumi Island
Office Tower Z

3-chome

TritonSquare- 55 -

EstateThe Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Valuers Co.,Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
Institute

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

GreaterTokyo
area

RetailProperty nameGreater
Logistics Tokyo
area

Opinion of value
at end of period(Millions of Yen)
(Note 3)

Investment
share
(%)
(Note 4)

Appraiser

Mitsubishi Motors Chofu

1,760

1,776

1,780

0.2

Mitsubishi Motors Shibuya

1,570

1,586

1,690

0.2

Mitsubishi Motors Nerima

1,240

1,251

1,390

0.1

Mitsubishi Motors Kawasaki

950

959

1,160

0.1

Mitsubishi Motors Takaido

850

859

887

0.1

Mitsubishi Motors Katsushika

800

808

885

0.1

Mitsubishi Motors Higashikurume

800

808

879

0.1

Mitsubishi Motors Setagaya

770

779

866

0.1

Mitsubishi Motors Suginami

740

748

807

0.1

Mitsubishi Motors Sekimachi

600

606

664

0.1

Mitsubishi Motors Higashiyamato

450

455

502

0.1

Mitsubishi Motors Motosumiyoshi

370

375

383

0.0

Mitsubishi Motors Kawagoe

350

355

371

0.0

Mitsubishi Motors Edogawa

200

204

185

0.0

Mitsubishi Motors Sayama

160

163

172

0.0

NRE Kichijoji Building (Note 6)

5,310

5,299

5,640

0.6

GEMS Ichigaya

2,080

2,099

2,080

0.2

Sagamihara Shopping Center

6,840

6,816

6,910

0.7

Musashiurawa Shopping Square (Note 7)

2,720

2,700

2,730

0.3

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.

649

644

662

0.1

Japan Valuers Co., Ltd.

Universal CityWalk Osaka

15,50015,722

17,800

1.8

Japan Valuers Co., Ltd.

Izumiya Senrioka

8,930

8,659

11,100

1.1

Merad Owada

6,640

6,527

7,340

0.7

Izumiya Yao

4,406

4,185

5,290

0.5

Izumiya Obayashi

3,020

3,192

3,770

0.4

Ichibancho stear

4,700

4,596

5,640

0.6

EQUINIA Aobadori

1,640

1,492

2,010

0.2

MEL Building

1,060

1,057

1,120

0.1

Retail subtotal

151,422

152,854

171,353

17.2

Landport Urayasu

17,40016,711

20,9002.1

Landport Itabashi

15,71015,16718,8001.9

Landport Kawagoe

13,70012,844

16,1001.6

Landport Atsugi

11,410

10,636

11,500

1.2

Sagamihara Tana Logistics Center

10,600

10,393

12,500

1.3

Sagamihara Onodai Logistics Center

8,700

8,248

10,9001.1

Landport Hachioji

8,250

7,799

9,520

1.0

Landport Kasukabe

7,340

6,823

8,650

0.9

Funabashi Logistics Center

4,660

4,586

5,500

0.6

Atsugi Minami Logistics Center B Tower

4,590

4,416

5,460

0.5

Hanyu Logistics Center

3,810

3,634

4,300

0.4

Ito-Yokado Higashi-Narashino Store

Other
areas

Acquisition price Carrying amount(Millions of Yen) (Millions of Yen)
(Note 1)
(Note 2)- 56 -The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Japan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Japan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
InstituteJapan Real Estate
Institute
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

Property name

Other
areas

Opinion of value
Investment
at end of period
share(Millions of Yen)(%)
(Note 3) (Note 4)

Kawaguchi Logistics Center B Tower

3,750

3,691

4,550

0.5

Kawaguchi Logistics Center A Tower

2,830

2,816

3,440

0.3

2,690

2,622

3,320

0.3

Kawaguchi Ryoke Logistics Center

10,79010,74912,4001.2

Landport Kashiwa Shonan II

10,80010,863

11,300

1.1

Ota Nitta Logistics Center

3,430

3,112

3,750

0.4

Ota Higashishinmachi Logistics Center

2,170

1,977

2,450

0.2

Ota Kiyohara Logistics Center

650

582

728

0.1

Chiyodamachi Logistics Center

330

315

367

0.0

Hirakata Kuzuha Logistics Center

3,460

3,475

3,810

0.4

147,070

141,468

170,245

17.1

Greater Atsugi Minami Logistics Center A Tower
Tokyo area

Logistics

Acquisition price Carrying amount(Millions of Yen) (Millions of Yen)
(Note 1)
(Note 2)

Logistics subtotal- 57 -

Appraiser
Daiwa
Real
EstateAppraisal Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.
The
Tanizawa
Sogo
Appraisal Co., Ltd.
Morii
Appraisal&
Investment Consulting,
Inc.
Japan Valuers Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.
Daiwa
Real
EstateAppraisal Co., Ltd.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

Property name

3,352

3,440

0.3

PROUD FLAT Yoyogi Uehara

989

989

1,060

0.1

PROUD FLAT Hatsudai

713

704

760

0.1

PROUD FLAT Shibuya Sakuragaoka

750

738

688

0.1

PROUD FLAT Gakugei Daigaku

746

733

787

0.1

PROUD FLAT Meguro Gyoninzaka

939

926

1,010

0.1

PROUD FLAT Sumida Riverside

2,280

2,230

2,460

0.2

PROUD FLAT Kagurazaka

1,590

1,561

1,730

0.2

PROUD FLAT Waseda

1,110

1,088

1,190

0.1

947

929

928

0.1

PROUD FLAT Sangen Jaya

1,190

1,165

1,260

0.1

PROUD FLAT Kamata

1,160

1,131

1,230

0.1

PROUD FLAT Kamata II

3,320

3,246

3,200

0.3

PROUD FLAT Shinotsuka

623

607

547

0.1

PROUD FLAT Kiyosumi Shirakawa

928

906

983

0.1

PROUD FLAT Monzen Nakacho II

652

638

600

0.1

PROUD FLAT Monzen Nakacho I

1,030

1,005

944

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co.
Daiwa Real EstateAppraisal Co.
Daiwa Real EstateAppraisal Co.

PROUD FLAT Fujimidai

1,470

1,441

1,580

0.2

Japan Real Estate Institute

PROUD FLAT Asakusa Komagata

1,920

1,870

2,040

0.2

PROUD FLAT Yokohama

2,090

2,039

2,170

0.2

PROUD FLAT Kamioooka

2,710

2,644

2,670

0.3

The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PROUD FLAT Tsurumi II

1,650

1,610

1,720

0.2

Japan Real Estate Institute

PRIME URBAN Azabu Juban

1,100

1,098

1,140

0.1

PRIME URBAN Akasaka

938

934

955

0.1

PRIME URBAN Tamachi

972

962

1,010

0.1

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

1,830

1,796

1,890

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Yoyogi

359

352

366

0.0

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Ebisu II

1,140

1,134

1,220

0.1

Japan Real Estate Institute

PRIME URBAN Bancho

1,090

1,082

1,080

0.1

679

669

693

0.1

PRIME URBAN Iidabashi

2,040

2,010

1,990

0.2

PRIME URBAN Ebisu

1,260

1,251

1,280

0.1

PRIME URBAN Naka Meguro

1,410

1,397

1,440

0.1

PRIME URBAN Gakugei Daigaku

775

767

819

0.1

PRIME URBAN Senzoku

474

469

485

0.0

PRIME URBAN Meguro Riverside

414

405

440

0.0

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Meguro Ohashi Hills

2,970

2,926

3,020

0.3

Japan Valuers Co., Ltd.

PRIME URBAN Meguro Aobadai

1,310

1,296

1,390

0.1

Japan Real Estate Institute

PRIME URBAN Gakugei Daigaku II

1,080

1,068

1,140

0.1

Japan Real Estate Institute

PRIME URBAN Naka Meguro II

2,850

2,844

2,940

0.3

Japan Real Estate Institute

PROUD FLAT Shinjuku Kawadacho

GreaterTokyo area

Appraiser

3,400

PROUD FLAT Shirokane Takanawa

Residential

Opinion of value Investment
Acquisition price Carrying amountat end of period
share(Millions of Yen) (Millions of Yen)
(Millions of Yen)(%)
(Note 1)
(Note 2)
(Note 3) (Note 4)

PRIME URBAN Shibaura LOFTPRIME URBAN Chiyoda Fujimi- 58 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Residential

Area

GreaterTokyo area

Property name

Opinion of value Investment
Acquisition price Carrying amountat end of period
share(Millions of Yen) (Millions of Yen)
(Millions of Yen)(%)
(Note 1)
(Note 2)
(Note 3) (Note 4)

Appraiser

PRIME URBAN Kachidoki

2,570

2,575

2,630

0.3

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Shinkawa

2,100

2,087

2,250

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Nihonbashi
Yokoyamacho

4,220

4,134

4,380

0.4

Japan Valuers Co., Ltd.

PRIME URBAN Nihonbashi Hamacho

1,550

1,528

1,650

0.2

Japan Real Estate Institute

PRIME URBAN Hongo Ikizaka

557

548

590

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Hakusan

866

845

929

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Yotsuya Gaien Higashi

1,490

1,482

1,580

0.2

PRIME URBAN Nishi Shinjuku I

1,090

1,085

1,150

0.1

PRIME URBAN Nishi Shinjuku II

885

871

942

0.1

PRIME URBAN Shinjuku Naitomachi

430

427

458

0.0

PRIME URBAN Nishi Waseda

421

411

448

0.0

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Shinjuku Ochiai

594

595

632

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Mejiro

1,430

1,419

1,490

0.1

Japan Real Estate Institute

PRIME URBAN Kagurazaka

2,900

2,852

2,950

0.3

Japan Real Estate Institute

PRIME URBAN Sangen Jaya III

718

715

629

0.1

PRIME URBAN Chitose Karasuyama

717

720

754

0.1

PRIME URBAN Sangen Jaya

724

711

770

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Minami Karasuyama

667

653

746

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Karasuyama Galleria

549

538

573

0.1

PRIME URBAN Karasuyama Court

338

332

357

0.0

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Chitose Funabashi

746

732

705

0.1

Japan Valuers Co., Ltd.

1,390

1,368

1,460

0.1

Japan Real Estate Institute

494

494

520

0.1

PRIME URBAN Osaki

1,860

1,841

1,970

0.2

PRIME URBAN Oimachi II

1,040

1,045

1,100

0.1

PRIME URBAN Yukigaya

951

949

975

0.1

PRIME URBAN Omori

905

886

951

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Denenchofu Minami

774

757

702

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Nagahara Kamiikedai

1,720

1,700

1,730

0.2

Japan Real Estate Institute

PRIME URBAN Nakano Kamitakada

498

487

532

0.1

Japan Valuers Co., Ltd.

1,060

1,054

1,120

0.1

PRIME URBAN Nishi Ogikubo

414

408

422

0.0

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Nishi Ogikubo II

1,790

1,774

1,830

0.2

Japan Real Estate Institute

PRIME URBAN Otsuka

730

722

765

0.1

PRIME URBAN Komagome

437

435

451

0.0

Daiwa Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Ikebukuro

3,800

3,736

3,890

0.4

Japan Real Estate Institute

PRIME URBAN Monzen Nakacho

2,420

2,380

2,520

0.3

779

760

802

0.1

PRIME URBAN Yoga
PRIME URBAN Shinagawa Nishi

PRIME URBAN Takaido

PRIME URBAN Kameido- 59 -

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

Property nameResidential

Other areas

Appraiser

PRIME URBAN Sumiyoshi

632

617

644

0.1

PRIME URBAN Mukojima

528

522

539

0.1

PRIME URBAN Kinshi Koen

1,290

1,257

1,320

0.1

PRIME URBAN Kinshicho

758

746

787

0.1

PRIME URBAN Hirai

722

704

749

0.1

PRIME URBAN Kasai

640

626

647

0.1

PRIME URBAN Kasai II

981

961

995

0.1

PRIME URBAN Kasai East

1,140

1,114

1,200

0.1

Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Chuo Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Itabashi Kuyakushomae

1,080

1,054

1,150

0.1

Japan Valuers Co., Ltd.

384

385

296

0.0

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Machiya South Court

1,910

1,889

1,980

0.2

Japan Real Estate Institute

PRIME URBAN Musashi Koganei

1,910

1,912

1,970

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Musashino Hills

1,280

1,280

1,330

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Koganei Honcho

791

778

838

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Kumegawa

1,520

1,475

1,400

0.1

Japan Real Estate Institute

PRIME URBAN Musashi Kosugi
comodo

1,940

1,927

2,080

0.2

Japan Valuers Co., Ltd.

962

954

1,020

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Shinyurigaoka

1,020

996

1,150

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tsurumi Teraya

493

488

394

0.0

Japan Real Estate Institute

PRIME URBAN Urayasu

804

789

840

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku I

633

621

549

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku II

730

715

653

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku Ekimae

488

481

499

0.1

Japan Real Estate Institute

PRIME URBAN Gyotoku Ekimae II

469

461

477

0.0

Japan Real Estate Institute

PRIME URBAN Gyotoku III

747

736

759

0.1

Japan Real Estate Institute

PRIME URBAN Nishi Funabashi

761

742

790

0.1

Japan Real Estate Institute

PRIME URBAN Kawaguchi

1,580

1,552

1,670

0.2

Japan Valuers Co., Ltd.

PROUD FLAT Hatchobori

920

951

976

0.1

Japan Real Estate Institute

PROUD FLAT Itabashi Honcho

720

751

775

0.1

Japan Real Estate Institute

PRIME URBAN Meguro Mita

1,058

1,133

1,110

0.1

Japan Valuers Co., Ltd.

Fukasawa House Towers H&I

7,140

7,112

7,310

0.7

PRIME URBAN Toyosu

5,290

5,262

5,390

0.5

PRIME URBAN Nihonbashi Kayabacho

2,850

2,842

2,890

0.3

PRIME URBAN Yoga II

1,320

1,315

1,330

0.1

PRIME URBAN Musashi Koganei II

1,310

1,301

1,330

0.1

PROUD FLAT Itsutsubashi

652

629

689

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
The Tanizawa Sogo
Appraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PROUD FLAT Kawaramachi

735

707

678

0.1

Japan Real Estate Institute

PROUD FLAT Shin Osaka

1,620

1,565

1,670

0.2

Japan Real Estate Institute

PRIME URBAN Kita Juyo Jo

274

267

272

0.0

The Tanizawa Sogo
Appraisal Co., Ltd.

PRIME URBAN Odori Koen I

502

487

520

0.1

Japan Real Estate Institute

PRIME URBAN Odori Koen II

334

325

343

0.0

Japan Real Estate Institute

PRIME URBAN Kita Juichi Jo

547

529

570

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Asakusa

GreaterTokyo area

Opinion of value Investme
Acquisition price Carrying amountat end of period nt share(Millions of Yen) (Millions of Yen)
(Millions of Yen)(%)
(Note 1)
(Note 2)
(Note 3)(Note 4)PRIME URBAN Kawasaki- 60 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

Use

Area

Residential Other areas

Greater
Other
Tokyo area

Property nameAppraiser

PRIME URBAN Miyanosawa

475

457

484

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Odori Higashi

394

382

410

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Chiji Kokan

249

240

264

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Maruyama

229

221

230

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Kita Nijuyo Jo

437

422

453

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Sapporo Idaimae

616

596

630

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Sapporo Riverfront

4,480

4,342

4,510

0.5

Japan Valuers Co., Ltd.

PRIME URBAN Kita Sanjo Dori

1,730

1,670

1,780

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Nagamachi Icchome

1,140

1,107

1,040

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Yaotome Chuo

466

455

429

0.0

Japan Valuers Co., Ltd.

PRIME URBAN Tsutsumidori Amamiya

949

953

904

0.1

Japan Real Estate Institute

PRIME URBAN Aoi

712

702

736

0.1

Chuo Real EstateAppraisal Co., Ltd.

PRIME URBAN Kanayama

553

536

588

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tsurumai

1,020

985

1,080

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Kamimaezu

1,590

1,544

1,610

0.2

Japan Valuers Co., Ltd.

PRIME URBAN Izumi

3,770

3,666

3,970

0.4

Japan Valuers Co., Ltd.

PRIME URBAN Esaka I

652

635

660

0.1

PRIME URBAN Esaka II

794

773

829

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Esaka III

1,190

1,151

1,140

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Tamatsukuri

1,020

994

1,030

0.1

Japan Valuers Co., Ltd.

PRIME URBAN Sakaisuji Honmachi

1,810

1,759

1,820

0.2

Japan Real Estate Institute

PRIME URBAN Hakata

588

571

610

0.1

PRIME URBAN Yakuin Minami

265

256

278

0.0

PRIME URBAN Kashii

398

383

335

0.0

PRIME URBAN Hakata Higashi

622

601

528

0.1

PRIME URBAN Chihaya

604

588

560

0.1

Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.
Daiwa Real EstateAppraisal Co., Ltd.

PRIME URBAN Chikusa

1,110

1,197

1,140

0.1

Japan Valuers Co., Ltd.

Residential subtotal

180,850

178,281

185,275

18.6

Ryotokuji University Shin-Urayasu
Campus (Land)

4,900

5,136

5,100

0.5

Other subtotal

4,900

5,136

5,100

0.5

932,896

928,836

994,463

100.0

Total
(Note 1)

Opinion of value Investme
Acquisition price Carrying amountat end of period nt share(Millions of Yen) (Millions of Yen)
(Millions of Yen)(%)
(Note 1)
(Note 2)
(Note 3)(Note 4)

Japan Real Estate Institute“Acquisition Price” refers to the following. Of the assets succeeded as a result of the merger of three REITs, the appraisal value as of September 30,
2015 for NRE Shibuya Dogenzaka Building and as of April 30, 2015 for other assets succeeded from NOF; and the appraisal value as of September 30,
2015 for PRIME URBAN Shinyurigaoka and as of May 31, 2015 for other assets succeeded from NRF are recorded as said assets’ respective acquisition
prices. Furthermore, the appraisal value as of August 31, 2016 for Ito-Yokado Higashi-Narashino Store and as of March 31, 2016 or April 1, 2016 forother assets succeeded from TOP are recorded as said assets’ respective acquisition prices. For all other assets, “Acquisition price” indicates the amount,
excluding the various expenses required to acquire the property, including transaction brokerage fees, taxes and public dues, etc. (the amount oftransaction payment for real estate, etc., described in the sales agreement).

(Note 2)“Carrying amount” is the sum total amount of the acquisition price (including various expenses required for the acquisition) of land, buildings, structures,
tools, furniture and fixtures, construction in progress, and leasehold rights (including these assets in trust), less accumulated depreciation.

(Note 3)

“Opinion of value at end of period” is the appraisal or investigation value provided by the respective real estate appraiser (the value calculated by therespective real estate appraiser with the date of the 3rd fiscal period-end (February 28, 2017) as the effective date of value and the value indicated by the
income approach as a standard) in accordance with NMF’s Articles of Incorporation and the Regulations Concerning Accounting of Investment
Corporations.
The appraisal or investigation value of real estate is no more than an indication of the opinion of the value of the appraised real estate at the time ofappraisal by the respective real estate appraiser, etc., conducted in accordance with the Act on Real Estate Appraisal (Act No. 152 of 1963, including
subsequent amendments), and real estate appraisal standards, etc. Reappraisal of the same real estate may result in a different appraisal or investigation- 61 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

value, depending on the real estate appraiser conducting the appraisal and the method or timing of the appraisal. In addition, the appraisal of real estate is
not a guarantee or promise of the possibility of transactions at present or in the future at the appraised value.
Furthermore, the cost approach and income approach (direct capitalization approach and discounted cash flow approach) are used in appraisal
calculations. The appraisal value is determined by the income approach if the subject real estate’s price is estimated with an emphasis on investment
profitability in the market and it is seen as an investment target for qualified institutional investors, etc. The value indicated by the cost approach is used as
an index to verify the value indicated by the income approach.
The “direct capitalization approach” is a method where the net revenue in a certain period is capitalized by the capitalization rate. It is a method ofseeking the value indicated by the income approach (a method of seeking the estimated value of real estate by seeking the sum of the present value ofthe net revenue the real estate is expected to generate in the future).
The “discounted cash flow (DCF) approach” is a method where the net income and terminal value arising in multiple successive periods are
discounted to present value according to their periods and totaled. It is also a method of seeking the value indicated by the income approach.
(Note 4)

“Investment share” is the period-end opinion of value of the respective asset as a percentage of the total amount of the period-end opinion of value ofthe entire portfolio (272 properties in total). The figures are rounded to the first decimal place. Accordingly, the sum total may be exactly 100.0.

(Note 5)

NMF holds quasi co-ownership of 50.1% of beneficial interest in real estate. For the for opinion of value and carrying price in the table above, price of
this quasi co-ownership interest ratio s stated for opinion of value and carrying price.

(Note 6)

NMF holds quasi co-ownership of 51.0% of beneficial interest in real estate. For the for opinion of value and carrying price in the table above, price of
this quasi co-ownership interest ratio s stated for opinion of value and carrying price.

(Note 7)

NMF holds quasi co-ownership of 50.0% of beneficial interest in real estate. For the for opinion of value and carrying price in the table above, price of
this quasi co-ownership interest ratio s stated for opinion of value and carrying price.

(Note 8)Property names were changed on September 1, 2016 for the following properties.
Old name

New name(Before change)(After change)

NOF Shinjuku Minamiguchi Building

NMF Shinjuku Minamiguchi Building

NOF Shibuya Koen-dori Building

NMF Shibuya Koen-dori Building

NOF Shiba Building

NMF Shiba Building

NOF Surugadai Plaza Building

NMF Surugadai Building

Otemachi Tatemono Gotanda Building

NMF Gotanda Ekimae Building

NOF Kanda Iwamotocho Building

NMF Kanda Iwamotocho Building

NOF Takanawa Building

NMF Takanawa Building

NOF Kichijoji Honcho Building

NMF Kichijoji Honcho Building

NOF Kawasaki Higashiguchi Building

NMF Kawasaki Higashiguchi Building

NOF Yokohama Nishiguchi Building

NMF Yokohama Nishiguchi Building

NOF Shin-Yokohama Building

NMF Shin-Yokohama Building

NOF Sendai Aoba-dori Building

NMF Sendai Aoba-dori Building

NOF Nagoya Fushimi Building

NMF Nagoya Fushimi Building

NOF Nagoya Yanagibashi Building

NMF Nagoya Yanagibashi Building

NOF Hakata Ekimae Building

NMF Hakata Ekimae Building

NOF Tenjin-Minami Building

NMF Tenjin-Minami Building

Ecology Toyosu Procentury

PRIME URBAN Toyosu

Top Residence Nihonbashi Kayabacho(Note 9)

PRIME

URBAN

Nihonbashi

Kayabacho

Top Residence Yoga

PRIME URBAN Yoga II

Impress Musashi-Koganei

PRIME URBAN Musashi-Koganei II

Property names were changed on April 1, 2017 for the following properties.
Old name

New name(Before change)(After change)

Akasaka Oji Building

NMF Aoyama 1-chome Building

Kanda Nishiki-cho 3-chome Building

NMF Takebashi Building

Shinkawa Chuo Building

NMF Kayabacho Building

Shinjuku EAST Building

NMF Shinjuku EAST Building

Shiba-Koen Building

NMF Shiba-Koen Building

Ginza Oji Building

NMF Ginza 4-chome Building- 62 -

Nomura Real Estate Master Fund, Inc. (3462)
Financial Results for the 3rd Fiscal Period Ended February 28, 2017

C. Status of Major Tenants
Not applicable.
D. Status of Major Properties
Not applicable.
E. Overview of Leasing to Interested Parties
As of February 28, 2017, some of the assets held by NMF at the same date were leased to interested parties
as defined in the Investment Trust Act.
The following is an overview of the status of leasing of said assets to interested parties as defined in theInvestment Trust Act.
Tenant name

Property name

Nomura Real Estate Partners
Co., Ltd.

Shinjuku Nomura Building
NRE Yotsubashi Building
Total of PROUD FLAT Shirogane-Takanawa,
and 111 others
Shinjuku Nomura Building
NMF Yokohama Nishiguchi Building
NRE Yotsubashi Building

Nomura Real Estate
Development Co., Ltd

Nomura Real Estate Life &Megalos Kanagawa
Sports Co.,Ltd.
Nomura Real Estate Urban Net
Shinjuku Nomura Building
Co., Ltd.
NMF Gotanda Ekimae Building
NMF Kichijoji Honcho Building
NMF Kawasaki Higashiguchi Building
NMF Yokohama Nishiguchi Building
NRE Nishi-Umeda Building
Geo Akamatsu Co., Ltd.
NRE Yotsubashi Building
Nomura Amenity Service Co.,NRE Yotsubashi Building
Ltd.

Leased area(m2)
1,021.25
1,024.91
191,022.87
6,625.91
94.83
1,369.84
6,217.85
1,740.51
198.90269.37216.54373.27404.41357.0680.01

F. Collateral
Assets held by NMF and offered as collateral at the end of the period under review are as follows.

Property Name

Type ofcollateral

Konami Sports Club Fuchu
Sagamihara Shopping Center

Mortgage
Mortgage

Secured party
Konami Sports Club Co., Ltd. (Note)
Ito-Yokado Co., Ltd. (Note)(Note) The secured claims are rights held by the security interest holders to claim the return of leasehold deposits.

- 63 -

Recent appraisal
value(Millions of Yen)
3,340
6,910