[For Translation Purposes Only]
February 7, 2019
For Immediate Release
To Whom It May Concern
Nomura Real Estate Master Fund, Inc.
Securities Code: 3462
Shuhei Yoshida, Executive Director
Asset Management Company:
Nomura Real Estate Asset Management Co., Ltd.
Norio Ambe, President & Chief Executive Officer
Inquiries:
Ken Okada
Director and Managing Executive Officer
TEL. +81-3-3365-8767 nmf3462@nomura-re.co.jp

Notice Concerning Forecasts of Financial Results
for the Fiscal Periods Ending August 31, 2019 and February 29, 2020
Nomura Real Estate Master Fund, Inc. (“NMF” or “Nomura Master Fund” or the “Fund”) announced its forecasts ofthe financial results and distributions for the fiscal periods ending August 31, 2019 (8th fiscal period: from March 1, 2019 toAugust 31, 2019) and February 29, 2020 ( 9th fiscal period: from September 1, 2019 to February 29, 2020).
There is no change in the forecasts of financial results for the fiscal period ending February 28, 2019 (7th fiscal period:
from September 1, 2018 to February 28, 2019) in the Summary of Financial Results (REIT) for the Fiscal Period Ended
August 31, 2018 released on October 15, 2018.

Fiscal period
endingAugust 31,
2019 ( 8thfiscal period
Fiscal period
endingFebruary 29,2020 ( 9thfiscal period

Total
Distribution Per
Unit (Including
Distribution in
Excess of Net
Income)(Yen)

Operating Profit(Millions ofYen)

Ordinary
Income(Millions of
Yen)

Net Income(Millions ofYen)

Distribution Per
Unit (Excluding
Distribution in
Excess of Net
Income)(Yen)

36,345

14,12911,48911,488

2,525

641

3,166

36,295

14,414

11,86011,859

2,607

617

3,224

Operating
Revenues(Millions ofYen)

Distribution in
Excess of Net
Income Per Unit
(Yen)

(Reference)
Anticipated total number of investment units as of August 31, 2019: 4,547,300 units
Anticipated net income per unit as of August 31, 2019: 2,526 yen
Anticipated total number of investment units as of February 29, 2020: 4,547,300 units
Anticipated net income per unit as of February 29, 2020: 2,607 yen
Note: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

-1-For details, please refer to the item of Investment units on Assumptions for Forecasts of the Financial Results for the
Fiscal Periods Ending August 31, 2019 (8th fiscal period: from March 1, 2019 to August 31, 2019) and February 29, 2020
(9th fiscal period: from September 1, 2019 to February 29, 2020) attached as the Exhibit below.
[Notes]1.

2.
3.

The forecasts presented in this document are calculated as of today, based on the assumptions set forth in the attached Assumptions
for Forecasts of the Financial Results for the Fiscal Periods Ending August 31, 2019 (8th fiscal period: from March 1, 2019 to August
31, 2019) and February 29, 2020 (9th fiscal period: from September 1, 2019 to February 29, 2020) as the Exhibit. The actual operating
revenues, operating profit, ordinary income, net income, distribution per unit or other items may differ due to future acquisition or
disposition of properties, changes in the real estate market and other factors affecting NMF. NMF does not guarantee the amount ofcash distribution stated above.
The forecasts may be revised if a certain variance from the forecasts mentioned above is expected.
Amounts less than the stated units are rounded down. The figures displayed as ratio are rounded to the first decimal place.

*Nomura Real Estate Master Fund, Inc. URL: https://www.nre-mf.co.jp/en/

Note: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

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[Exhibit]

Assumptions for Forecasts of the Financial Results for
the Fiscal Periods Ending August 31, 2019 (8th fiscal period: from March 1, 2019 to August 31, 2019) andFebruary 29, 2020 (9th fiscal period: from September 1, 2019 to February 29, 2020)
Item

Assumptions

 8th Fiscal Period: March 1, 2019 to August 31, 2019
 9th Fiscal Period: September 1, 2019 to February 29, 2020
 In addition to properties held by the Fund as of the date hereof (283 properties)(the “Acquired Assets”), it is assumed that the Fund will acquire 10 properties by theend of the Fiscal Period Ending August 31, 2019 (8th Fiscal Period) and sell 5
properties by the end of the Fiscal Period Ending February 28, 2019 (7th Fiscal
Period).
 Regarding the 10 properties to be acquired as announced in the “Notice Concerning
Property Acquisition” dated today, it is assumed that, (i) PMO Tamachi Higashi,
PMO Hatchobori Shinkawa, PMO Kyobashi-Higashi, GEMS Shinbashi, GEMS
Kayabacho, GEMS Shin-Yokohama, GEMS Namba, Summit Store Honamanuma
and Landport Ome I will be acquired on March 1, 2019; and (ii) PMO Ochanomizu
Assets under
will be acquired on April 1, 2019, respectively (those 10 properties are hereinaftercollectively referred to as the “Assets to be Acquired”). Regarding the 5 properties
Management
to be sold as announced in the “Notice Concerning Property Disposition” dated
January 15, 2019, it is assumed that such properties will be sold on February 8, 2019
(those 5 properties are hereinafter collectively referred to as the “Assets to be Sold”).
 The forecasts are based on the assumption that (a) the Assets to be Acquired arerespectively acquired on the above-mentioned dates and the Assets to be Sold aresold on the above-mentioned date and that (b) there will be no other changes in
assets under management (new property acquisitions or sales of portfolio
properties) through the end of the Fiscal Period Ending February 29, 2020 (9thFiscal Period).
 The forecasts may be affected due to actual changes in the portfolio or other reasons.
 The rental revenues are estimated based on the operating revenues from theAcquired Assets, the information provided from the sellers of the Assets to beOperating Revenues
Acquired, the tenant trends, competitive properties located in adjacent areas, and thereal estate market conditions, among other factors, and it is assumed that there are
no arrears and non-payment by tenants.
 Real estate rental expenses are estimated to be ¥15,720 million for the Fiscal PeriodEnding August 31, 2019 (8th Fiscal Period) and ¥15,352 million for the Fiscal PeriodEnding February 29, 2020 (9th Fiscal Period).
 Regarding property and other taxes, it is estimated that ¥2,927 million for the Fiscal
Period Ending August 31, 2019 (8th Fiscal Period) and ¥2,914 million for the Fiscal
Period Ending February 29, 2020 (9th Fiscal Period) will be recorded as real estate
Operating Expenses
rental expenses. In general, the fixed asset taxes and urban planning taxes that will
be imposed, relevant to the year in which such properties will be acquired, will be(excluding Amortization ofdivided between the seller and the purchaser on a pro-rata basis based on holding
Goodwill)
period and settled at the time of acquisition, and such taxes are deemed asacquisition costs and, are not included in the expenses. Therefore, the fixed asset
taxes and urban planning taxes regarding the Assets to be Acquired will not berecorded as expenses for the Fiscal Period Ending August 31, 2019 (8th Fiscal
Period) and the Fiscal Period Ending February 29, 2020 (9th Fiscal Period).
 Regarding property management costs (including building management fees andPeriodNote: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

-3-

Item

Assumptions









Amortization of
Goodwill
Non-operating
ExpensesInterest-bearing
debt

property management fees), it is estimated that ¥2,687 million for the Fiscal PeriodEnding August 31, 2019 (8th Fiscal Period) and ¥2,613 million for the Fiscal PeriodEnding February 29, 2020 (9th Fiscal Period) will be recorded as real estate rental
expenses.
Expenses for repairs and maintenance required for each fiscal period expected to berecorded as real estate rental expenses are calculated based on the mid-to-long term
repair plans that the Asset Management Company of the Fund has established.
However, the actual expenses for the repairs and maintenance for the relevant fiscal
period may differ significantly from the estimates due to the expenses for urgent
repair of damages to a building caused by events difficult to foresee and the tendency
for significant fluctuation in amounts period by period or that the expenses forcertain types of repair are not required periodically.
Regarding depreciation, it is estimated that ¥5,114 million for the Fiscal PeriodEnding August 31, 2019 (8th Fiscal Period) and ¥5,089 million for the Fiscal PeriodEnding February 29, 2020 (9th Fiscal Period) will be recorded as real estate rental
expenses.
It is estimated that other operating expenses (including fees payable to the AssetManagement Company, the custodian of assets and the general administrators) willbe ¥3,872 million for the Fiscal Period Ending August 31, 2019 (8th Fiscal Period)and ¥3,906 million for the Fiscal Period Ending February 29, 2020 (9th Fiscal
Period).
Goodwill will be amortized using the straight-line method over 20 years on a regularbasis pursuant to the Business Combination Accounting Standards, and the amountof amortization of goodwill for both Fiscal Period Ending August 31, 2019 (8thFiscal Period) and the Fiscal Period Ending February 29, 2020 (9th Fiscal Period) is
estimated to be ¥2,622 million.
Goodwill amortization cost is an item that causes difference between accounting
and tax treatment and may result in the imposition of corporation tax or other taxes.
The Fund intends to make distributions in excess of net income for the purpose of
tax relief during the goodwill amortization period, and it is expected that the Fund
will be able to avoid such taxation.
Temporary expenses estimated to be ¥57 million for the Fiscal Period Ending
August 31, 2019 (8th Fiscal Period) is expected to be recorded in relation to theissuance of new investment units (the “Issuance”) resolved at the board of directors
meeting held on February 7, 2019. In addition, interest expenses and otherborrowing related expenses are expected to be ¥2,572 million for the Fiscal PeriodEnding August 31, 2019 (8th Fiscal Period) and ¥2,545 million for the Fiscal PeriodEnding February 29, 2020 (9th Fiscal Period).
As of the date hereof, the outstanding interest-bearing debt of the Fund are¥497,134 million, consisting of the amount of ¥475,134 million of outstanding
borrowings and the amount of ¥22,000 million of investment corporation bonds.
The Fund will conduct new borrowings (¥16,000 million) in March 2019, for a partof the funds for the acquisition of the Asset to be Acquired, and in April 2019, theFund will repay part of the above borrowings through the proceeds from additional
issuance of the investment units through the third party allotment. Regarding theborrowings of ¥45,564 million that will become due and payable by the end of the
Fiscal Period Ending August 31, 2019 (8th Fiscal Period) and the borrowings of¥29,942 million that will become due and payable during the Fiscal Period Ending
February 29, 2020 (9th Fiscal Period), it is assumed that the Fund will repay ¥21
million by using cash on hand in the Fiscal Period Ending February 28, 2019 (7thNote: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

-4-

Item

Assumptions

Investment Units







Distribution per Unit







Distribution per unit inexcess of earnings per
unit

Fiscal Period), and repay ¥42 million by using cash on hand in the Fiscal PeriodEnding August 31, 2019 (8th Fiscal Period) and in the Fiscal Period Ending February
29, 2020 (9th Fiscal Period) respectively, and will refinance the remaining amountthrough borrowings.
It is assumed that there will be no changes in the amount of the outstanding interestbearing debt, other than as stated above. However, the above-mentioned amount of
the borrowings or the amount of repayment thereof may change depending on theissue price, etc. of the investment units to be issued this time.
It is assumed that, in addition to the 4,321,800 investment units issued andoutstanding as of the date hereof, the additional issuance of the investment units
through the domestic public offering and international offering (214,760 investment
units) and the additional issuance of the investment units through the third party
allotment (up to 10,740 investment units) totaling 225,500 investment units will all
be issued.
Other than the above, it is assumed that no additional investment units will be issued
through the end of the Fiscal Period Ending February 29, 2020 (9th Fiscal Period).
Net income per unit and distribution per unit are calculated on the basis of 4,547,300
investment units assumed to be issued and outstanding at the end of each fiscal
period, including the investment units to be issued this time.
Distribution per unit is calculated in accordance with the Fund’s distribution policy
outlined in its Articles of Incorporation.
Distributions for the Fiscal Period Ending August 31, 2019 (8th Fiscal Period) andthe Fiscal Period Ending February 29, 2020 (9th Fiscal Period) are assumed to be
distributed with additional distribution of 288 million yen for 8th fiscal period and
179 million yen for 9th fiscal period in order to stabilize distributions, which is
expected to decline as a result of the temporary decline in operating revenues forthese fiscal periods due to vacancy period caused by a major tenant and free rent tobe granted. The additional distribution is to be distributed as other distributions inexcess of net earnings.
In respect of the allowance for temporary difference adjustments (the “ATA”)
accrued so far, it is assumed that the amount to be eliminated of ¥5 million for the
Fiscal Period Ending August 31, 2019 (8th Fiscal Period) and the amount to beeliminated of ¥5 million for the Fiscal Period Ending February 29, 2020 (9th Fiscal
Period) are reversed from the unappropriated retained earnings in the 8th Fiscal
Period and the 9th Fiscal Period, respectively.
Distribution per unit is calculated assuming that the variation in the market price ofinterest rate swaps do not affect distribution per unit in the Fiscal Period Ending
August 31, 2019 (8th Fiscal Period) and the Fiscal Period Ending February 29, 2020
(9th Fiscal Period). Distribution per unit may vary due to various factors, includingchanges in the investment portfolio, changes in rent income caused by tenant
replacements, and unforeseen 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 deductedfrom the total difference between accounting and tax treatment and the distributableamount as ATA for the purpose of tax relief. The estimate is based on theassumption that, in order to alleviate the impact on distributions of the amortizationof goodwill and other merger-related expenses (the “Merger Expenses”) and thereversal of ATA, if the total difference between accounting and tax treatment andfor the relevant fiscal period is less than the sum of the Merger Expenses and thereversal of allowance for temporary difference adjustments, NMF will make other
distributions in excess of net income in an amount not exceeding this difference andNote: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

-5-

Item

Other

Assumptions
within the limit prescribed by the regulations of the Investment Trusts Association,
Japan (the “Investment Trusts Association Japan Regulations”) (the amountequivalent to 60/100 of the total amount of accumulated depreciation recorded asof the end of the relevant fiscal period less the total amount of accumulated
depreciation recorded as of the end of the immediately preceding fiscal period).
 The distribution in excess of net earnings per unit for the Fiscal Period Ending
August 31, 2019 (8th Fiscal Period) is expected to be ¥641, comprising ¥348 indistributions of ATA and ¥293 in other distributions in excess of net earnings. The
distribution in excess of net earnings per unit for the Fiscal Period Ending February
29, 2020 (9th Fiscal Period) is expected to be ¥617, comprising ¥381 in distributionsof ATA and ¥236 in other distributions in excess of net earnings.
 It is assumed that there will be no amendments in legislation, taxation, accounting
principles, listing requirements, the regulations of the Investment Trusts Association,
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.

Note: This press release is a public announcement concerning the forecasts of financial results for the fiscal periods ending August 31,
2019 and February 29, 2020 and has not been prepared for an inducement or invitation for investment. This press release should
not be construed as an offer or solicitation of an offer to purchase any investment units or other investment of NMF. Prospective
investors are advised to make any investment decisions at their own risk and responsibility.

-6-