Translation Purpose Only

FINANCIAL REPORT FOR THE FISCAL PERIOD ENDED APRIL 30, 2007
(November 1, 2006 to April 30, 2007)

June 11, 2007

Kenedix Realty Investment Corporation is listed on the Tokyo Stock Exchange with the securities code number 8972.
(URL http://www. kdx-reit.com)
Contact: Kenedix REIT Management, Inc.
Masahiko Tajima, General Manager, Financial Planning Division
TEL +81-3-3519-3491
Board of Directors meeting for approving financial results: June 11, 2007
The starting date for distribution payment is scheduled for July 10, 2007

1．PERFORMANCE FOR THE FISCAL PERIOD ENDED OCTOBER 31, 2006 AND APRIL 30, 2007
(1) Business Results(The amount is rounded down to the nearest ¥million)
Operating Revenues
Fourth Fiscal
PeriodThird Fiscal
PeriodOperating Income

109.3%¥2,686104.7%¥2,148101.1%¥2,148101.1%¥5,288184.2%¥2,565190.9%¥2,125

192.7%¥2,124

192.7%Net Income per Unit

Unitholders’Equity(ROE)

PeriodThird Fiscal
PeriodNet Income¥5,778Return on

Fourth Fiscal

Ordinary Income

Oridinary<Reference>

Ordinary Income to<Reference>

Income to（Annualized）

Total Assets（Annualized）

Operating
Revenues¥13,6812.4%(4.8%)

1.2%(2.5%)

37.2%¥13,575

3.1%(6.2%)

1.7%(3.3%)

40.2%

Notes:
1.
Net income per unit is calculated using the average number of investment units for the fourth fiscal period: 157,000units.
Net income per unit is calculated using the average number of investment units for the third fiscal period: 156,460 units.
2.
Changes in accounting policies: Yes
3.
Percentage change figures are shown for operating revenues, operating income, ordinary income and net income
4.
Annualized percentage figures = Percentage figures for the relevant fiscal period / Number of actual investment management days for the relevant fiscal period × 365 days.
5.
Return on unitholders’ equity and ordinary income to total assets is calculated using the average of the respective balances of unitholders’ equity and total assets as of the
beginning and end of the fiscal period.
（The total distribution is rounded down to the nearest ¥million.）(2) Distribution
Distributions per
Unit (Yen)

Total Distribution

Excluding Excess(Millions of Yen)of Earnings
Fourth Fiscal
PeriodThird Fiscal
PeriodDistributions in

Total Distributions

Excess of Earnings

in Excess ofper Unit (Yen)

Earnings

Distribution Ratio
Payout Ratio

to Unitholders’Equity¥13,682¥2,148−−100.0%

2.4%¥13,529¥2,124

−

−

99.9%

2.3%

Note: The payout ratio is rounded down to the nearest first decimal place.

-1-

（The total assets and unitholders’ equity are rounded down to the nearest ¥million.）(3) Financial Position

Fourth Fiscal
PeriodThird Fiscal
PeriodTotal Assets

Unitholders’ Equity

Unitholders’ Equity to Total

Unitholders’ Equity per Share(Millions of Yen)

(Millions of Yen)

Assetsof Common Stock (Yen)¥188,400¥90,87748.2%¥578,839¥160,314¥90,933

56.7%¥579,192

Note: The number of investment units outstanding as of April 30, 2007 :totaled 157,000 units.
The number of investment units outstanding as of October 31, 2006 totaled 157,000 units.

2．FORECAST OF RESULTS FOR THE FIFTH FISCAL PERIOD(May 1, 2007 to October 31, 2007)

Fifth Fiscal
PeriodOperating Revenues

Ordinary Income

Net Income(Millions of Yen)

(Millions of Yen)

(Millions of Yen)

¥7,060¥2,681¥2,680Distribution perDistribution in

Unit(Yen)Excluding

Excess of Earings

Excess of Earnings

per Unit (Yen)¥13,400−

Reference: Estimated net income per unit for the fifth fiscal period: ¥13,400
Note: Forecasts presented in this document are based on “Assumptions for Forecasts for the Fourth Fiscal Period (from May 1, 2007 to October 31, 2007)” indentified in a
separate reference. Forecasts for net income and distribution per unit may differ from actual results due to changes in operating conditions and a variety of factors.
Accordingly, Kenedix Realty Investment Corporation does not guarantee any distribution amount.

-2-

Investment Highlights
Kenedix Realty Investment Corporation (“the Investment Corporation”) today announced the financial results for its fourthfiscal period (from November 1, 2006 to April 30, 2007).
In the fourth fiscal period, the Investment Corporation recorded operating revenues of ¥5,778 million, operating income of¥2,686 million, ordinary income of ¥2,148 million and net income of ¥2,148 million. As a result, cash distribution for the
fiscal period under review was ¥13,682 per unit.

Management Performance
In the fiscal period under review, the Investment Corporation acquired 10 office buildings with a total acquisition price of¥29,755 million. From the viewpoint of reviewing its portfolio on December 11, 2006, the Investment Corporation sold 2
residential properties (total acquisition price of ¥1,603 million) on April 20, 2007. As a result, the number of properties
owned as of April 30, 2007 stood at 72, with a total acquisition price of ¥175,090 million. Looking at the portfolio as awhole, 66.2% was comprised of office buildings, 24.5% of residential properties and 9.1% central urban retail properties onan acquisition price basis. In addition, the occupancy ratio as of the end of the fourth fiscal period was 95.9%, reflecting
stable investment and asset management.

Capital Acquisition
To support the acquisition of additional assets, the Investment Corporation undertook debt financing of ¥29.0 billion during
the fourth fiscal period comprising ¥9.5 billion of long-term debt and ¥19.5 billion of short-term debt (Note 1). In addition,
the Investment Corporation undertook prepayment of ¥12.0 billion in short-term debt provided from cash on hand fromthe issuance of the investment corporation bonds. As a result, the balance of interest-bearing debt stood at ¥88.5 billion asof April 30, 2007, comprising ¥76.5 billion in debt financing (¥58.0 billion in long-term debt and ¥18.5 billion in short-termdebt) and ¥12.0 billion in investment corporation bonds. In addition, the long-term debt ratio (Note2) was 79.1% and thefixed interest debt ratio (Note3) was 75.7%.
As of April 30, 2007, the Investment Corporation had ¥46.8 billion in long-term debt, of which ¥43.8 billion had fixedinterest rates or floating interest rates effectively fixed by utilizing interest-swap agreements.
Since its public listing through to the end of the fourth fiscal period, the Investment Corporation has undertaken flexible
debt funding on both an unsecured and unguaranteed basis. This is the result of the high standing in which the Investment
Corporation, its investment policies, asset quality as well as the personnel and expertise of the Asset Management
Company are held among financial institutions. In addition, the Investment Corporation strives to diversify repayment
dates for its debt financing in an effort to reduce refinancing risk. The Investment Corporation also strives to extend average
repayment periods by placing added emphasis on long-term debt.
Notes:
1. Short-term debt financing refers to debt financing with a period of less than or equal to one year from the drawdown
date to the repayment date. Long-term debt financing refers to debt financing with a period of more than one year
from the drawdown date to the repayment date.
2. Long-term debt ratio＝（Balance of long-term debt＋Balance of investment corporation bonds）÷（Total debt financing＋
Balance of investment corporation bonds）
3. Fixed interest debt ratio＝（Balance of fixed interest debt＋Balance of investment corporation bonds）÷（Total debt financing＋Balance of investment corporation bonds）
The balance of fixed interest rate debt includes debt with floating interest rates effectively fixed by utilizing interest-rate swap
agreements.
3

Continue Stable Financial Strategy
The Investment Corporation acquired a credit rating of A+ (Outlook: Stable) from Japan Credit Rating Agency, Ltd. on
December 11, 2006. This was the second credit rating acquired following the A3 (Outlook: Stable) from Moody’s InvestorsServices, Inc. on February 28, 2006. Details of the credit ratings as of April 30, 2007 are as follows.
Credit Rating Agency

Details of the Ratings
Rating：A3
Outlook：Stable
Senior Debts：A+
Outlook: Stable

Moody’s Investors Service
Japan Credit Rating Agency, Ltd.

On February 7, 2007, a resolution was made concerning the offering of investment corporation bonds (hereafter the“comprehensive resolution”, the same applies below). The Investment Corporation also filed a debt shelf registration statement.
Details are as follows.
Total Amount of Ceiling for Gross Amount of¥100,000,000,000 respectively
Each Investment Corporation Bond Offering /Planned Issue Amount
Effective Period of Resolution /February 15, 2007 to February 14, 2009
Planned Issuance Period
Acquisition funds for specified assets, repayment funds forborrowings, repayment funds for investment corporation bonds,
Use of Funds
refund funds for lease and guarantee deposits, funds to pay for repairs
and maintenance, working capital, etc.
The Investment Corporation issued investment corporation bonds for the purpose of diversifying financing to support
portfolio growth, with an emphasis on increasing the proportion of debt with fixed interest rates and longer maturity periods
and achieving an appropriate mix of debt and equity financing. Details of the investment corporation bonds are as follows. In
addition, the Investment Corporation issued its 10-year investment corporation bond, “Second Series Unsecured Investment
Corporation Bond” in the shortest amount of time after IPO among J-REITs. Accordingly, the Investment Corporation has
succeeded in diversifying maturities and lengthening its average debt maturity.

Name of Investment
Corporation Bonds
Total Amount of the Bonds
Interest Rate
Term
Payment Period
MaturityFirst Series Unsecured Investment
Corporation Bonds(Ranking pari passu among theSpecified Investment Corporation Bonds¥9,000,000,000

Second Series Unsecured Investment
Corporation Bonds(Ranking pari passu among the Specified
Investment Corporation Bonds)¥3,000,000,000

1.74％ per annum
5 years
March 15, 2007
March 15, 2012

2.37％ per annum
10 years
March 15, 2007
March 15, 2017

The Investment Corporation established a credit commitment line with The Bank of Tokyo-Mitsubishi UFJ, Ltd.,
allowing it to borrow up to ¥2.5 billion on an unsecured basis.
On April 26, 2007, the Investment Corporation filed an equity shelf registration statement to conduct equity financing.
Details are as follows.
4Planned Issue AmountApplication for the Shelf Registration
Date
Planned Issuance Period¥100,000,000,000
April 26, 2007

Use of Funds

Acquisition funds for specified assets, repayment of borrowings, repayment ofinvestment corporation bonds, refund of lease and guarantee deposits, funds topay for repairs and maintenance, working capital, etc

May 7, 2007 to May 6, 2009 (Planned)

Internal Growth Strategies
Taking into consideration economic and real estate market trends, the Investment Corporation adopts a tenant-oriented
approach to its leasing activities with aims of ensuring a timely and flexible responses as well as optimal tenant satisfaction.
Accordingly, the Investment Corporation will aim to increase of the cash flow by offering office environment with high tenantsatisfaction. Based on the aforementioned, the Asset Management Company undertakes property management activities asfollows:
・Identify and enhance satisfaction through use of tenant surveys
・Maintain attractive properties based on KDX standards
・Leasing management based on CS Strategy
・Careful control of management and operating costs
The Investment Corporation has appointed Kenedix Advisors Co., Ltd. as its Property Management Company for its
entire portfolio.
Identify and enhance tenant satisfaction through use of tenant surveys
The Investment Corporation recognizes each tenant as a key customer and strives to enhance customer satisfaction
and raise the competitiveness of its properties as the means to maintain and increase earnings. During the fiscal
period ended April 30, 2006, the Investment Corporation conducted a customer satisfaction survey through J.D.
Power Asia Pacific, Inc., an internationally recognized company that engages in customer satisfaction evaluation,
to better understand the needs of its tenants and take steps to respond to their preferences. This survey covered 20
of its properties, 19 of which were office properties and one of which was a central urban retail property. As a partof this survey the administration officers of each tenant and tenant employees were asked to respond to manyquestions concerning building location and environment, external façade, entrance, air conditioning system forlease space areas, lighting ventilation, OA compliant, elevators, toilets, kitchen facilities, smoking areas, parking,management company service, status and standard of cleaning, security, and fire prevention, and to remark oneach building and its facilities, as well as the nature and quality of operating and management services. On a scale
one to five, respondents were asked to rank each of these areas. The survey provided invaluable information
pertaining to the strengths and weaknesses of each building. Under the remarks section, a number of respondents
provided insightful observations. Based on survey results, the Investment Corporation will work to clarify andimprove outstanding issues. Through this vital feedback channel, the Investment Corporation will also implement
appropriate maintenance and renovations for each property taking into consideration associated costs and benefits.
Plans are in place to conduct a second customer satisfaction survey during the fiscal period ending October 31,
2007.
Through these means, the Investment Corporation is working efficiently to generate improvements in rent levels
and asset values, increase earnings and promote sustained internal growth.

5

Maintain attractive properties based on KDX standards
The Investment Corporation aims to provide attractive mid-sized office buildings in order to enhance portfolio
value and rental revenues.
We believe that the quality of mid-sized office buildings in Japan vary considerably depending on the nature of theowner. For example, a building owned by an individual or small company that owns only one or a few buildings
may not have the resources to provide high-quality maintenance. Furthermore, when a building is owned by alarge company, property management is often dictated by that companyʼs priorities and does not necessarily
correspond to tenant needs or satisfaction.
The Investment Corporation aims to differentiate itself by efficiently providing certain uniform standards, termed“KDX” standards, as well as attractive office environments.
Examples of KDX standards include the followings:
・ Installation of security cameras for elevators and entrance halls
・ Installation of emergency devices for elevators
・ Installation of modern restrooms that include western-style toilets with hot-water self-cleaning
functions・ Creation and distribution of security and evacuation maps
・ Creation and distribution of detailed building rules
In addition, the Investment Corporation enhances its brand awareness by renaming its office buildings so that“KDX” is included in the new name.
Leasing management based on CS Strategy
The Investment Corporation aims to provide flexible and focused leasing activities that take into accounteconomic and market trends, and that utilize the results of tenant surveys to enhance tenant satisfaction.
In addition, the Investment Corporation believes that tenants at mid-sized office buildings generally tend tohave high turnover ratios, and it is focused on obtaining higher rent levels when entering new lease contracts. The
Investment Corporation also negotiates with tenants that pay lower rent levels than the market price in order toraise rents under existing leases.
Careful control of management and operating costs
The Investment Corporation utilizes the scale merits of owning many properties and the negotiating strength of
the Kenedix Group (the Kenedix Group refers to Kenedix, Inc., Kenedix Advisors and other related companies,
the same applies below) to reduce building management costs. Accordingly, the Investment Corporation reduces
property management expenses, electricity costs and property taxes. The Investment Corporation will continue tocarefully control management and operating costs by periodically reviewing its property management standards
to ensure that they remain relevant and appropriate for each property, and by maintaining an appropriate balance
between initiatives that aim to sustain or increase revenues with its efforts to control operating costs.
The Investment Corporation has appointed Kenedix Advisors Co., Ltd. as its sole property managementcompany for the entire portfolio as of the end of the fourth fiscal period. In establishing a single point of contact
for all matters relating to property management activities, the Investment Corporation strives to secure consistentpolicies, specifications and procedures along with ensuring swift and quality service.
The Investment Corporation is presently satisfied with the quality of property management. In addition toproperty management services, the Investment Corporation has executed master lease agreements with Kenedix
Advisors covering almost all of its properties held as of April 30, 2007 (excluding Residence Charmante
Tsukishima, Frame Jinnan-zaka, ZARA Tenjin Nishi-dori and tenants without approval for subleasing). In
appointing a member of the Kenedix Group as lessee, the Investment Corporation is able to provide better6tenant-oriented leasing management through Kenedix Advisors. At the same time, this scheme allows theInvestment Corporation to more effectively utilize tenant security and guarantee deposits. The Investment
Corporation leverages scale merits and the communication and negotiation skills of the Kenedix Group in aneffort to reduce operating costs. In addition, the Investment Corporation has succeeded in reducing in building
maintenance costs.
・New Property Investment Strategy (External Growth Strategy)
The Investment Corporation will continue to concentrate on mid-sized office buildings with an emphasis on the Tokyo
Metropolitan Area while also investing in central urban retail property located in highly flourishing districts as analternative to investment in office buildings. In addition, the Investment Corporation will make no new investment inresidential properties for a certain period and consider replacement of assets. To facilitate the implementation of theaforementioned investment policy, the Investment Corporation will leverage the “Multi-Pipeline” provided by the supportof the Kenedix Group, in addition to the original network of the Asset Management Company.
Through the Multi-Pipeline, the Asset Management Company is positioned to secure real estate information related toproperties for which the Kenedix Group acts as intermediary, properties under development, properties that it owns, andpension funds (Note). Based on this information, the Investment Corporation has first preferential negotiating rights for an
acquisition. Against the backdrop of a competitive market, the role of the support-line is increasingly significant for the
Asset Management Companyʼs acquisition of quality properties.
Note: Pension Funds refer to real estate investment funds for pension plans that are managed by Kenedix Advisors Co.,
Ltd.
Another key role of the support-line is to facilitate property acquisition through the warehousing function. Under thewarehousing function, members of the Kenedix Group may acquire or temporarily hold an investment property sourced
from the original network of the Asset Management Company in the event that the Investment Corporation is not itself in
an immediate position to acquire the property, or the property fails to fully comply with the Investment Corporation’s
investment criteria at that specific time.
The Investment Corporation seeks to continue improving the quality of its portfolio in terms of location, size and type of
properties, through various measures including replacement of assets. In addition, the Investment Corporation willcontinue to steadily grow by acquiring properties and aims accelerate this growth by utilizing its leverage relationship with
the Kenedix Group and the Asset Management Company’s original network for sourcing properties, as well as makediversified acquisitions, as discussed below.
Leverage Relationship with the Kenedix GroupAs the sponsor company, Kenedix, Inc. has provided property information and support staff to the Investment
Corporation and the Asset Management Company. At the same time, the Investment Corporation believes thatthe role of J-REITs in the Kenedix Group has increased in importance.
In April 2007, the Investment Corporation revised the Memorandum of Understanding between it, Kenedix,
Inc., Kenedix Advisors Co., Ltd. and the Asset Management Company, which was originally conducted at thetime of the Investment Corporation’s IPO. The Investment Corporation revised the Memorandum because it
had been expanding the number of acquired properties and strengthening its property acquisition capacity evenmore was deemed necessary as J-REITs were increasing in importance for the Kenedix Group.

■Details of the Change of Memorandum of Understanding
・When Kenedix, Inc. receives information regarding any available property that in its reasonable opinion
meets our investment criteria, including properties under development, from parties other than the7contracting parties, the Asset Management Company has first preferential rights to such information.
(Before Revision: The Investment Corporation had second preferential rightsafter certain pension funds
to such property information acquired by Kenedix, Inc.)
・In the event that Kenedix, Inc. disposes of a property that in its reasonable opinion meets our investment
criteria, including properties under development or properties that it owns, the Asset Management
Company has first preferential negotiating rights with respect to such properties.
(Before Revision: The Investment Corporation had second preferential negotiating rights with respect
to such properties after certain pension funds)
・As long as the Investment Corporation and the Asset Management Company continue to not invest in
new residential properties, the Revised Memorandum of Understanding will not apply with respect toresidential properties
Also as a result of the revisions, the Pipeline relationship between the Kenedix Group and the Investment
Corporation was significantly strengthened, allowing the Investment Corporation preferential rights toproperties developed by the Kenedix Group. Looking ahead, the Investment Corporation and the sponsor
company plans to closely cooperate to achieve further external growth in such investments as Group-wide joint
investments and property developments.
Utilize the Asset Management Company’s Original Network for Sourcing Properties
The Asset Management Company’s employees have diverse experience in the real estate and financial markets
in Japan. A part of the Investment Corporation’s growth strategy involves acquiring information about
potential acquisition opportunities through the Asset Management Company’s network. The Investment
Corporation plans to continue to utilize the Asset Management Company’s knowledge, experience andnetwork of contacts in the real estate market to help locate and acquire properties that match its investment
strategy.
Make Diversified Acquisitions
As of April 30, 2007, the Investment Corporation owned 72 properties for a total acquisition price ofapproximately ¥175.0 billion with a 95.9% occupancy ratio. Supported by this asset base along with the
management know-how of mid-sized office building accumulated by the Asset Management Company, theInvestment Corporation plans to continue acquiring properties based on its diversified property acquisition
strategy. Against the backdrop of stable trends in its investment units, the Investment Corporation believes that
this strategy will enable it to take a more aggressive approach to acquiring properties.

8

Outlook
Forecasts for the fifth fiscal period (May 1, 2007 to October 31, 2007) are presented as follows. Please refer to the“Preconditions and Assumptions for the Fiscal Period Ending October 31, 2007” below for factors that underpin forecasts.
Operating Revenues
Ordinary Income
Net Income
Distribution per Unit
Distribution in Excess of Earnings per Unit

¥7,060 million¥2,681 million¥2,680 million¥13,400¥0

Note: Forecast figures are calculated based on certain assumptions. Readers are advised that actual operating revenues, net
income and distribution per unit may differ significantly from forecasts due to a variety of reasons. Accordingly, the Investment
Corporation does not guarantee payment of the forecast distribution per unit.
“Preconditions and Assumptions for the Fiscal Period Ending October 31, 2007”

Property Portfolio

Operating Revenues
Operating Expenses

Non-Operating Expenses
Debt Financing andInvestment Corporation
Bonds

Preconditions and Assumptions● Forecasts for the fiscal period ending October 31, 2007 are based on a property
portfolio totaling 77 properties held as of June 11, 2007,● The property portfolio may change due to a variety of factors.
● Rental revenues are estimated based on historic performance and a variety of factors
including each property’s competitive standing and market and other conditions.
● Property expenses other than depreciation are based on historic expenses, adjusted toreflect the variable nature of expenses.
● In general, property tax and city planning tax are allocated to the seller and purchaser
on a pro rata basis at the time of acquisition settlement. In the case of the Investment
Corporation, an amount equivalent to the portion allocated to the purchaser is includedin the acquisition price of the property.
● Repairs, maintenance and renovation expenses are estimated based on the AssetManagement Company budgeted amounts for each property and amounts consideredessential for each period. Actual repairs, maintenance and renovation expenses for eachfiscal period may, however, differ significantly from estimated amounts due tounforeseen circumstances or emergencies.
● For the fiscal period ending October 31, 2007, approximately amounts of ¥1,422
million has been estimated for depreciation expense.
● Amounts for interest payable and investment corporation bond interest of ¥586
million has been forecasted for the fiscal period ending October 31, 2007.
●The Investment Corporation conduct a public offering and third-party allotment of a
maximum of 2,100 units and from the funds procured an amount of approximately¥6,250 million for the purpose of repayment of debt financing, which stood at ¥69,750
million as of June 11, 2007. After the repayment, no significant changes in the amountof debt financing are expected.
●For the fifth fiscal period, forecasts are based on a total balance of investment
corporation bonds of ¥12,000 million as of June 11, 2007. Forecasts are also based on
the assumption that the balance of debt financing shall remain unchanged in the fifth
fiscal period.

9

Investment Units Issued
and Outstanding
Distributions per Unit
Distributions in Excess of
Earnings per Unit
Other

●At the conclusion of the third-party allotment and sale through an over-allotment
option, the number of units issued and outstanding is assumed to reach 200,000, fromthe 197,900 units issued and outstanding as of June 11, 2007.
● Distributions per unit of amounts less than ¥1 are omitted. Calculations are based on
a 100% distribution of unappropriated retained earnings.
● The Investment Corporation does not currently anticipate distributions in excess ofearnings per unit.
● Forecasts are based on the assumption that any revisions to regulatory requirements,
taxation, accounting standards, public listing regulations or requirements of theInvestment Trusts Association, Japan will not impact forecast figures.
● Forecasts are based on the assumption that there will be no major unforeseen changes
to economic trends and in real estate and other markets.

10Balance Sheets
Fourth Fiscal Period

Third Fiscal Period（As of April 30, 2007）（As of October 31, 2006）（Thousands(％)（Thousandsin Yen）(％)

Increase / Decrease（Thousands inin Yen）(％)

Yen）

ASSETS
I. Current assets

9,333,184

4.9

10,243,869

6.4△910,684

Cash and bank deposits

3,740,550

4,709,666△969,116

Entrusted deposits

5,182,512

4,779,041

403,470

Rental receivables

75,124

83,374△8,249Prepaid expenses

29,84547,206△17,361

Consumption tax refundable

302,040

599,486△297,445

3,111

25,093△21,981

Other current assets
II. Fixed assets
1

1. Property and equipment, at cost *178,896,941

95.0

149,945,921

93.5

28,951,019

119.3

178,516,827

94.8

149,719,621

93.4

28,797,205

119.2

Buildings

4,818,319

1,313,459

3,504,860

Structures

52,061

52,813△751

Machinery and equipment

28,741

1,879

26,861Tools, furniture and fixtures

3,500

2,760

739

Land

7,910,082

2,148,301

5,761,781

Buildings held in trust

59,002,008

55,173,235

3,828,773

Structures held in trust

236,337

247,088△10,751

Machinery and equipment held in trust

675,401

667,292

8,109

Tools, furniture and fixtures held in trust

513,193546,862△33,669

Land held in trust

105,277,180

89,565,928

15,711,252

2. Intangible fixed asset

285,144−

285,144

Land leasehold

285,144−

285,144

3. Investment and other assets

94,9690.1

0.1

226,300

0.1△131,330

Leasehold and security deposits

11,64918,205△6,556Long-term prepaid expenses

83,32076,874

6,446−

131,220△131,220

Derivative assets
ⅢDeferred

170,551

0.1

124,5500.1

46,000Organization costs

30,53835,627△5,089Investment Corporation Issuance Costs

68,875−68,875

Unit Issuance Costs

71,13888,923△17,784

Total assets

91.1

188,400,678

100.0

11

160,314,341

100.0

28,086,336

−

42.0

136.9

117.5

Fourth Fiscal Period

Third Fiscal Period（As of April 30, 2007）（As of October 31, 2006）（Thousands in（Thousands

(％)

(％)

Increase / Decrease（Thousands inYen）

in Yen）

ⅠCurrent liabilities

21,444,151

16,204,462

Trade payables

275,299

289,763△14,464

Short-term debt

18,500,000

13,500,000

5,000,000

Current maturities of long term debt

1,500,000

1,500,000−

Other payables

138,451

117,128

21,323

Accrued expenses

86,74227,36259,379

543

923

△380

Rents received in advance

916,372

767,536

148,835

Deposits received

26,743

1,748

24,995(％)Yen）

LIABILITIES

Accrued income taxes

ⅡLong-term liabilities

76,078,756

40.4

53,176,581

10.1

33.2

5,239,689

22,902,174

132.3

143.1

Investment Corporation bonds issued

12,000,000−

12,000,000

Long-term debt

56,500,000

47,000,000

9,500,000

Leasehold and security deposits received

626,499

184,398

442,100

Leasehold and security deposits held in

6,952,256

5,940,494

1,011,762

Deferred tax liability

56,500,000

51,6879,500,000

Total liabilities

97,522,908

51.8

69,381,044

43.3

28,141,863

140.6

I. Unitholder’s equity

90,877,769

48.2

90,853,764

56.6

24,005100.0

1. Capital stock

88,729,652

47.1

88,729,652

55.4

−

−

trust received

2(Net assets)*

2. Retained earnings
Retained earnings at end of period

2,148,117

II. Valuation and translation adjustments−

Unrealized gain from deferred hedge−

2,124,112−

79,532

24,0050.1

79,532△79,532−△79,532

Total net assets

90,877,769

48.2

90,933,297

56.7△55,527

99.9

Total liabilities and net assets

188,400,678

100.0

160,314,341

100.0

28,086,336

117.5

12

Statements of Income and Retained Earnings
Fourth Fiscal Period

Third Fiscal Period（As of April 30, 2007）（As of October 31, 2006）（Thousands in（Thousands in

(％)

Yen）
1. Operating revenues

Yen）

5,778,210

1

Rental revenues *

(％)

100.0

Increase / Decrease（Thousands inYen）

5,288,833

100.0

489,376

4,965,303

4,549,456

415,847

Other rental revenues *682,158

582,043

100,115

Profit on sale of trust beneficiary interests

130,748

157,334△26,586

1

(％)

109.3

in real estate*2
2. Operating expenses

3,091,465
1

53.5

2,723,641

51.5

367,823

Property-related expenses *2,607,389

2,397,201

210,187

Asset management fees

306,965

203,841

103,123

Directors’ salaries

5,400

5,400

−

Custodian fees

17,928

11,705

6,222

Administrative service fees

48,67235,022

13,649Audit fees

7,800

5,900

1,900

Other operating expenses

97,30964,56932,740Operating income
3. Non-operating revenues

113.5

2,686,744

46.5

2,565,192

48.5

121,552

104.7

9,716

0.2

2,389

0.1

7,326

406.7

Interest income

2,137

461

1,675

Other Non-operating revenues

7,578

1,927

5,651

4..Non-operating expenses

547,5819.5

442,500

8.4

105,081Interest expense

450,605

375,765

74,840Investment corporation bonds interest

29,320−29,320Financing related expense

20,59520,904△308

Amortization of bonds issuance costs

1,501

−

1,501

Amortization of unit issuance costs

17,784

17,784−

Amortization of organization costs

5,089

5,089

−

Other non-operating expenses

22,685

22,956

△271

123.7

Ordinary income

2,148,879

37.2

2,125,081

40.2

23,798

101.1

Income before income taxes

2,148,879

37.2

2,125,081

40.2

23,798101.1

Current income taxes

816

0.0

1,009

0.0

△192

80.9

Deferred income taxes

4

Net Income
Retained earnings at the beginning of period
Retained earnings at the end of period

02,148,058

37.2

2,124,071

4
40.2

23,9865940

18

2,148,117

2,124,112

24,005

13

101.1

Statements of Changes in Unitholder’s Equity
Fourth Fiscal Period (November 1, 2006 to April 30, 2007)(Thousands in Yen)

Unitholder’s Equity
Capital Stock
1*
Balance at the beginning of a

Valuation and Translation Adjustments

Retained Earnings

Total

Retained Earnings

Unitholder’sat end-period

EquityUnrealized gain fromDeferred Hedge

Total Valuation
and Translation

Total Net Assets

Adjustments

88,729,652

2,124,112

90,853,764

79,532

79,53290,933,297

Payment of dividends−△2,124,053△2,124,053−−△2,124,053

Net Income−

2,148,058

2,148,058−−

2,148,058

Interest-rate swap

−

−

−

△79,532△79,532△79,532−

24,00524,005△79,532△79,532△55,527

88,729,652

2,148,117

90,877,769−−

90,877,769

periodChanges during the fiscal period

Total changes during the fiscal
periodBalance at the end of period

Third Fiscal Period (May 1, 2006 to October 31, 2006)(Thousands in Yen)

Unitholder’s Equity
Capital Stock
1*

Valuation and Translation Adjustments

Retained Earnings

Total

Retained Earnings

Unitholder’sat end-period

EquityUnrealized gain fromDeferred Hedge

Total Valuation
and Translation

Total Net Assets

Adjustments

Balance at the beginning of a44,285,002

1,102,013

45,387,015−−

45,387,015

periodChanges during the fiscal period
New unit issuance

44,444,649−

44,444,649−−

44,444,649

Payment of dividends−△1,101,973△1,101,973−−△1,101,973

Net Income
Interest-rate swap−−

2,124,071−

2,124,071−−
79,532−
79,532

2,124,071
79,53244,444,649

1,022,098

45,466,748

79,532

79,53245,546,281

88,729,652

2,124,112

90,853,764

79,532

79,53290,933,297

Total changes during the fiscal
periodBalance at the end of period

14Properties Roster(Millions in Yen)
Type

Area

Tokyo
Office Buildings

Metropolitan
Area

Property Name

Acquisition Price（Note1）

Amount on the

Appraisal Value at theBalance Sheet

end of Fourth Fiscal(Note2)

Period (Note3)

Ratio (%)
(Note4)KDX Ochanomizu Building (Note5)

6,400

6,447

6,640

3.6

KDX Shiba-Daimon Building (Note6)

6,090

6,164

6,340

3.4

KDX Kojimachi Building

5,950

5,923

6,220

3.3

KDX Nihonbashi 313 Building

5,940

6,373

7,530

3.3

Toshin-24 Building

5,300

5,313

5,860

3.0

KDX Hirakawacho Building

5,180

5,196

5,660

2.9

Ebisu East 438 Building

4,640

4,666

5,600

2.6

Higashi-Kayabacho Yuraku Building

4,450

4,577

5,760

2.5

KDX Toranomon Building

4,400

4,580

4,020

2.5

KDX Nishi-Gotanda Building

4,200

4,391

4,700

2.3

KDX Hatchobori Building

3,680

3,627

3,920

2.1

KDX Omori Building

3,500

3,506

3,860

1.9

KDX Hamamatsucho Building

3,460

3,453

3,730

1.9

KDX Higashi-Shinjuku Building

2,950

2,997

3,100

1.6

Dai-ichi Kayabacho Building

2,780

2,857

3,030

1.5

KDX Shinbashi Building

2,690

2,711

3,050

1.5

KDX Nakano Sakaue Building

2,533

2,496

2,680

1.4

KDX Shin-Yokohama Building

2,520

2,553

2,680

1.4

Harajuku F.F. Building

2,450

2,531

3,060

1.3

KDX Kajicho Building

2,350

2,372

2,410

1.3

KDX Hamacho Building

2,300

2,413

2,890

1.3

FIK Minami Aoyama

2,270

2,307

3,340

1.2

KDX Funabashi Building

2,252

2,415

2,360

1.2

KDX Okachimachi Building (Note7)

2,000

2,084

2,010

1.1

Kanda Kihara Building

1,950

1,923

1,990

1.1

KDX Yotsuya Building

1,950

1,981

2,110

1.1

KDX Shinjuku-Gyoen Building

1,610

1,645

1,970

0.9

KDX Kiba Building

1,580

1,633

1,690

0.9

KDX Nishi-Shinjuku Building(Note8)

1,500

1,569

1,500

0.8

KDX Monzen-Nakacho Building

1,400

1,461

1,430

0.7

KDX Hon-Atsugi Building (Note9)

1,305

1,360

1,320

0.7

KDX Hachioji Building (Note10)

1,155

1,211

1,160

0.6

KDX Nogizaka Building

1,065

1,125

1,060

0.6

KDX Koishikawa Building

704

698

827

0.4

Other

Portus Center Building

5,570

5,454

5,620

3.1

Regional

KDX Minami Semba Dai-1 Building

1,610

1,589

1,640

0.9

Areas

KDX Minami Semba Dai-2 Building

1,560

1,553

1,620

0.8

Hakata-Ekimae Dai-2 Building

1,430

1,483

1,600

0.8

KDX Niigata Building

1,305

1,376

1,200

0.7

115,979

118,029

127,187

66.2

Total of 39 Office Buildings

15

Area

Property Name

（Note1）

Balance Sheet

end of Fourth Fiscal(Note2)

Period (Note3)

Ratio (%)
(Note4)

5,353

5,427

5,460

3.0

Metropolitan

Regalo Ochanomizu I&II

3,600

3,664

3,670

2.0

Area

Storia Sirokane

3,150

3,181

3,370

1.7

Tre di Casa Minami Aoyama

2,460

2,487

2,660

1.4

Regalo Shiba-Kouen

2,260

2,293

2,280

1.2

Court Mejiro

1,250

1,269

1,140

0.7

Apartments Motoazabu

1,210

1,233

1,300

0.6

Apartments Wakamatsu Kawada

1,180

1,197

1,240

0.6

Chigasaki Socie Ni-bankan

1,160

1,242

1,160

0.6

Court Nihonbashi-Hakozaki

1,130

1,145

1,220

0.6

Court Nishi-Shinjuku

1,130

1,153

1,160

0.6

Side Denenchofu

1,110

1,151

1,100

0.6

Gradito Kawaguchi

1,038

1,093

1,060

0.5

S-court Yokohama-Kannai II

945

955

1,000

0.5

Regalo Komazawa-Kouen

912

930

943

0.5

Court Motoasakusa

880

899

925

0.5

Court Shin-Okachimachi

878

902

888

0.5

Bloom Omotesando

875

891

955

0.4

Human Heim Okachimachi

830

848

890

0.4

Primo Regalo Kagurazaka

762

786

770

0.4

Primo Regalo Youga

730

747

735

0.4

Court Shimouma

638

655

644

0.3

Other

Ashiya Royal HOmes

2,330

2,415

2,440

1.3

Regional

Venus Hibarigaoka

1,800

1,961

1,770

1.0

Areas

Regalo Ibaraki I&II

1,600

1,646

1,670

0.9

Collection Higashi-Sakura

1,264

1,341

1,274

0.7

Renaissance 21 Hirao Jousui-machi

900

928

962

0.5

Montore Nishikouen Bay Court

826

851

831

0.4

Abreast Hara

444

447

494

0.2

Abreast Hirabari

407

414

457

0.2

43,052

44,16644,468

24.5

Frame Jinnan-zaka

9,900

10,295

11,800

5.6

KDX Yoyogi Building

2,479

2,622

2,490

1.4

ZARA Tenjin Nishi-dori

3,680

3,688

3,760

2.1

16,05916,606

18,0509.1

175,090

178,801

189,705

100.0

Tokyo
Metropolitan
Properties

Appraisal Value at the

Residence Charmante Tsukishima

Total of 30 Residential Properties
Central Urban Retail

Amount on theTokyo

Residential Properties

Type

Acquisition Price

Area
Other
Regional
Areas

Total of 3 Central Urban Retail Properties
Total of 72 properties
Notes:

1. Acquisition price is the purchase price for trust beneficiary interests or properties acquired by the Investment Corporation exclusive of taxes,

16

rounded down to the nearest million yen.
2. Figures of less than1 million are rounded down from the amounts on the balance sheet.
3. Appraisal values (end of the fourth fiscal period) are based on the asset valuation method and standards outlined in the Investment
Corporation’s Articles of Incorporation and regulations formulated by the Investment Trusts Association, Japan. Appraisal values are drawn
from valuation reports preprared by the Japan Real Estate Institute, Tanizawa Sogo Appraisal Co., Ltd., Daiwa Real Estate Appraisal
Corporation, Chuo Real Estate Appraisal Co., Ltd. and Nippon Tochi-Tatemono Limited.
4. Figures are the acquisition price of each asset as a percentage of the total acquisition prices for the portfolio rounded down to the nearest firstdecimal place.

5. As of April 30, 2007, the name of the property is the “Kenkyusha Building.” Plans are in place to change the name of the property to the“KDX Ochanomizu Building” on October 1, 2007. The same applies below.

6. As of April 30, 2007, the name of the property is the “Shuwa Dai-san Shiba Park Building.” Plans are in place to change the name of theproperty to the “KDX Shiba-Daimon Building” on September 1, 2007. The same applies below.
7. As of April 30, 2007, the name of the property is the “Kairaku Building.” The name of the property has been changed to the “KDX
Okachimachi Building” on June 1, 2007. The same applies below.

8. As of April 30, 2007,the current name of the “KDX Nishi-Shinjuku Building” is the “N.S. EXCEL Building.” Following theacquisition, the Investment Corporation intends to carry out procedures to change the name of the building. The same applies
below.
9. As of April 30, 2007, the name of the property is the “Sumisei Atsugi Dai-2 Building.” The name of the property has been changed to the“KDX Hon-Atsugi Building” on June 1, 2007. The same applies below.

10. As of April 30, 2007, the name of the property is the “Sumisei Hachioji Building.” The name of the property has been changed to the“KDX Hachioji Building ” on June 1, 2007. The same applies below.

17

Property Distribution
A． Property TypesType

Number of
Properties

Acquisition Price(Millions of Yen)

Ratio (Note) (%)

Office Buildings

39

115,979

66.2

Residential Properties

30

43,052

24.5

Central Urban Retail Properties

3

16,059Others

−

−

Total

72

175,090

100.0

Acquisition Price（Millions of Yen）

Ratio (Note) (%)

9.1

B． Geographic Distribution
Area

Number of
Properties

Tokyo Metropolitan Area

58

150,364

85.8

Other Regional Areas

14

24,726

14.1

Total

72

175,090

100.0

Number of
Properties

Acquisition Price（Millions of Yen）

Ratio (Note) (%)

Less than 1,000

14

10,7316.1

1,000 - 2,500

34

56,44332.2

2,500 - 5,000

15

52,23329.8

5,000 - 7,500

845,78326.1

7,500 - 10,000

1

9,900

5.6

Total

72

175,090

100.0

C． Property Distribution by Acquisition Price
Acquisition Price(Millions of Yen)

Note: “Ratio” refers to the percentage of the acquisition price by each category to the acquisition prices of the entire portfolio. Figures
are rounded down to the nearest first decimal place.

18

Details of Investment Real Estate and Trust Real Estate
Type

Area
Tokyo
Metropolitan

Office Buildings

Area

Total Floor Area

Type of（㎡）

Structure(Note1)(Note2)

Property NameKDX Ochanomizu Building

7,720.08

KDX Shiba-Daimon Building

7,824.03

KDX Kojimachi Building

5,323.81

KDX Nihonbashi 313 Building

8,613.09

Toshin-24 Building

8,483.17

KDX Hirakawacho Building

8,002.97

Ebisu East 438 Building

4,394.58

Higashi-Kayabacho Yuraku Building

5,916.48

KDX Toranomon Building

2,277.38

KDX Nishi-Gotanda Building

5,192.87

KDX Hatchobori

4,800.43

KDX Omori Building

7,334.77

KDX Hamamatsucho Building

3,592.38

KDX Higashi-Shinjuku Building

7,885.40

Dai-ichi Kayabacho Building

3,804.86

KDX Shinbashi Building

3,960.22

KDX Nakano-Sakaue Building

6,399.42

KDX Shin-Yokohama Building

6,180.51

Harajuku F.F. Building

3,812.44

KDX Kajicho Building

3,147.70

KDX Hamacho Building

4,133.47

19

SRC
B1F7
SRC
B1F9
SRC
B2F9
SRC
B2F9
SRC
B1F8
SRC
B3F10
SRC
B1F7
SRC
B1F9
SRC
B1F9
SRC
B1F8
SRC･RC
B1F8
RC･SRC
B1F9
S
F9
SRC
B1F9
SRC
F8
SRC･S
B1F8
SRC
B1F11
S
B1F9
SRC
F11
SRC
B1F8
SRC
B2F10

Completion Date

PML Percentage(Note3)(%)

August1982

5.35

July 1986

13.72

May 1994

4.94

April 1974

17.36

September 1984

17.19

March 1988

8.02

January 1992

7.68

January 1987

7.88

April 1988

14.77

November 1992

8.23

June 1993

5.21

October 1990

4.21

September 1999

9.89

January 1990

5.40

October 1987

7.18

February 1992

10.55

August 1992

5.05

September 1990

13.82

November 1985

13.02

March 1990

8.81

September 1993

12.10

OtherRegional
Areas

FIK Minami Aoyama

1,926.98

KDX Funabashi Building

5,970.12

KDX Okachimachi Building

1,882.00

Kanda Kihara Building

2,393.94

KDX Yotsuya Building

3,329.68

KDX Shinjuku-Gyoen Building

2,594.88

KDX Kiba Building

2,820.64

KDX Nishi-Shinjuku Building

2,017.63

KDX Monzen-Nakacho Building

2,668.91

KDX Hon-Atsugi Building

3,603.63

KDX Hachioji Building

2,821.21

KDX Nogizaka Building

1,695.07

KDX Koishikawa Building

1,866.58

Portus Center Building

79,827.08

KDX Minami Semba Dai-1 Building

4,236.59

KDX Minami Semba Dai-2 Building

3,315.93

Hakata-Ekimae Dai-2 Building

4,846.01

KDX Niigata Building

6,810.29

Total of 39 Office Buildings

Residential Properties

Tokyo
Metropolitan
Area

253,427.23

Residence Charmante Tsukishima

18,115.39

Regalo Ochanomizu I&II

4,843.27

Storia Sirokane

5,750.05

Tre di Casa Minami Aoyama

1,986.44

20

SRC
B1F9
SRC
B1F8
S
F10
SRC･RC･S
B1F8
RC
B2F4
S･SRC
F9
RC
F5
RC
F5
SRC
F8
SRC
F8
SRC
F9
RC
B1F5
SRC
B1F9
SRC･S
B2F25
SRC･RC･S
B1F9
SRC･S
B1F9
SRC
F9
RC
B2F13
―
SRC
B1F10

November 1988

6.37

April 1989

4.11

June 1988

3.72

May 1993

14.28

October 1989

5.56

June 1992

8.16

October 1992

9.16

October 1992

7.03

September 1986

6.39

May 1995

12.45

December 1985

13.96

May 1991

7.08

October 1992

11.47

September 1993

3.49

March 1993

7.23

September 1993

7.94

September 1984

0.69

July 1983

1.74

Average of 18.1 yrs―

January 2004

17.11

①RC B1F10①January 2006

②RC F11②February 2006

SRC･S
B2F13
RC
B1F6

9.32

February 2003

7.77

February 2004

7.44

OtherRegional

Regalo Shiba-Kouen

2,786.98

Court Mejiro

3,326.07

Apartments Motoazabu

1,685.14

Apartments Wakamatsu Kawada

1,858.51

Chigasaki Socie Ni-bankan

3,821.74

Court Nihonbashi-Hakozaki

1,727.96

Court Nishi-Shinjuku

1,669.33

Side Denenchofu

2,433.52

Gradito Kawaguchi

1,705.38

S-court Yokohama-Kannai II

1,738.71

Regalo Komazawa-Kouen

1,262.00

Court Motoasakusa

1,585.65

Court Shin-Okachimachi

1,494.55

Bloom Omotesando

699.14

Human Heim Okachimachi

1,444.25

Primo Regalo Kagurazaka

1,007.54

Primo Regalo Youga

1,213.20

Court Shimouma

880.18Ashiya Royal Homes

5,015.67

Areas

RC
F13
RC
B1F3
RC
F11
RC
F12
RC
F8
SRC
F12
RC
F8
RC
F6
RC
F12
RC
F11
RC
F8
SRC
F13
RC
F11
RC
B1F3
SRC
F14
RC
F8
RC
F8
RC
F6
RC
F5

November 2005

12.39

March 1997

5.74

January 2004

6.24

February 2004

7.56

January 1991

18.75

February 2004

13.44

October 2005

6.44

February 1997

10.39

February 2006

13.33

March 2003

19.45

February 2006

9.29

January 2005

9.90

October 2005

4.70

March 2003

6.55

December 2004

12.19

January 2006

7.86

December 2005

9.98

October 2005

8.43

June 1991

11.05

March 1989

6.48

①RC F6Venus Hibarigaoka

14,976.25②RC F5③RC F6

Regalo Ibaraki I&II

6,445.92

Collection Higashi-Sakura

2,931.65

Renaissance 21 Hirao Jousui-machi

2,643.36

21①RC F4①May 1991②RC B1F7②March 1993

RC
F14
RC

17.20

March 2006

12.20

October 2005

0.42

F5
Montore Nishikouen Bay Court

2,772.49

Abreast Hara

1,563.47

Abreast Hirabari

1,867.75

Central Urban Retail Properties

Total of 30 Residential Properties
Tokyo
Metropolitan
Area

101,251.56

Frame Jinnan-zaka

6,302.58

KDX Yoyogi Building

1,269.06

ZARA Tenjin Nishi-dori

1,445.02

Other
Regional
Areas
Total of 3 Central Urban Retail Properties

Total of 72 properties

RC
F10
SRC
F11
RC
F7
―
SRC･RC･S
B2F7
SRC
F8
S
F4

February 2006

0.23

February 2000

13.34

March 2000

13.56

Average of 5.2 yrs―

March 2005

6.20

August 1991

9.59

November 2005

0.70―

9,016.66―

Average of 4.0 yrs

363,695.45―

Average of 13.6 yrs

7.15(Note4)

Notes:
1. Total floor area is based on figures recorded in the land register and does not include related structures. The total floor area for theentire buildings is reported for compartmentalized ownership.
2. Type of structure data is based on data recorded in the land register. The following abbreviations are used to report data relating tostructure and the number of floors:
SRC: Steel-Reinforced Concrete; RC: Reinforced Concrete; S: Steel Frame; B: Below Ground Level; F: Above Ground Level.
For example: B2F9: Two floors below ground level and nine floors above ground level.
3. Completion date is the date of construction completion recorded in the land register. Average age subtotal and total data is calculatedusing the weighted-average based on acquisition prices as of October 31, 2006.
4. Probable Maximum Loss (PML) data is based on a survey provided by Sompo Japan Risk Management, Inc. as of August 2006.

22

Disclaimer

This financial report includes translations of certain documents originally filed and made available in Japan in accordance with
the Securities and Exchange Law of Japan. This English language financial report was prepared solely for the convenience ofreaders outside Japan and is not intended to constitute a document for an offer to sell, or seeking an offer to buy, any securitiesof Kenedix Realty Investment Corporation. English terms for Japanese legal, accounting, tax, and business concepts usedherein may not be precisely identical to the concept of the equivalent Japanese terms. With respect to any and all terms herein,
including without limitation, financial statements, if there exist any discrepancies in the meaning or interpretation thereof
between the original Japanese documents and English translation contained herein, the original Japanese documents will
always govern the meaning and interpretation.
None of Kenedix Realty Investment Corporation, Kenedix REIT Management, Inc. or any of their respective directors, officers,
employees, partners, unitholders, agents, affiliates or their advisors will be responsible or liable for the completeness,
appropriateness, or accuracy of English translations or the selection of the portion(s) of any document(s) translated into
English.
The financial statements of Kenedix Realty Investment Corporation have been prepared in accordance with generally accepted
accounting principles in Japan “Japanese GAAP”, which may materially differ in certain respects from generally accepted
accounting principles in other jurisdictions.
This financial report contains forward-looking statements. These statements appear in a number of places in this financial
report and include statements regarding the intent, belief, or current and future expectations of Kenedix Realty Investment
Corporation or Kenedix REIT Management, Inc. with respect to its business, financial condition and results of operations. In
some cases, you can identify forward-looking statements by terms such as “may,” “will,” “should,” “would,” “expect,” “plan,”“anticipate,” “believe,” “estimate,” “predict,” “potential,” or the negative of these terms or other similar terminology. Thesestatements are not guarantees of future performance and are subject to various risks and uncertainties. Actual results,
performance or achievements, or those of the industries in which we operate, may differ materially from any future results,
performance or achievements expressed or implied by these forward looking statements. In addition, these forward-looking
statements are necessarily dependent upon assumptions, estimates and data that may be incorrect or imprecise and involve
known and unknown risks and uncertainties. Accordingly, readers of this document should not interpret the forward-looking
statements included herein as predictions or representations of future events or circumstances.
Potential risks and uncertainties also include those identified and discussed in this document. Given these risks anduncertainties, readers of this document are cautioned not to place undue reliance on forward-looking statements, which speak
only as of the date of information produced herein. We disclaim any obligation to update or, except in the limited
circumstances required by Tokyo Stock Exchange, announce publicly any revisions to any of the forward-looking statements
contained in this document.

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