As of January 22, 2019

Daiwa Office Investment Corporation
Earnings Announcement for the 26th Fiscal Period(Fiscal Period ended November 2018)

Securities Code: 8976

Contents

Section 3
Overview of Daiwa Office Investment Corporation
Topics of the Fiscal Period ended November 2018 (26th FP)
Use of 30 Billion Yen of Surplus Funds
Change in Major Indices after Portfolio Replacement

External Growth3
45

Section 1

Acquisition/Sale Policy and Status of Deliberation for
Property Acquisitions
Newly Acquired Properties in the Fiscal Period
ended November 2018
Newly Acquired Properties in the Fiscal Period
ending May 2019
Changes in Asset Size and Trading Performance

Fiscal Period ended November 2018 (26th Fiscal
Period) Performance Highlights and Forecasts
Highlights of the Fiscal Period ended November 2018 (26th FP)
Highlights of Forecasts for the Fiscal Periods ending May 2019
and November 2019 (27th and 28th FP)

7

Section 4

8

Efforts on ESG

Changes in Dividends

9

Concepts of Efforts on ESG
Efforts on ESG | Environment
Efforts on ESG | Social
Efforts on ESG | GovernanceEfforts on ESG | Sustainable Development Goals (SDGs)

Section 2
Internal Growth
Leasing Market of Tokyo Office Buildings
11
Analyses of Leasing Income
12
Portfolio Map: Increase and Decrease in Unit Contract Rent
Compared with Previous Fiscal Period
16
Percentage of Properties by Region and Status in Shinjuku andShibuya Areas
17
Internal Growth Strategies
18
Occupancy Status of Properties Subject to Leasing Improvementin the Fiscal Period ended November 2018 (26th FP)
19
Properties Subject to Leasing Improvement in the Fiscal Period
ending May 2019 (27th FP)

20

Purpose of Large-scale Repair Work and Cases of Construction
Work in the Fiscal Period ended November 2018

21

23

24
26
27

29
30
33
34
36

Section 5
Financial Strategy
Status of Interest-bearing Liabilities
Unitholders as of the End of the November 2018 (26th) Fiscal
PeriodFuture Initiatives

39

42
43

Appendix

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

1Disclaimer

This material is solely for the purpose of providing information and is not intended for the purpose of offering or
soliciting investment, or as a recommendation to purchase or sell any specific product. Please refer any inquiries
on potential purchases of the investment units of Daiwa Office Investment Corporation to a securities dealer.
This document is not intended to provide information to meet the requirements of Japan’s Financial Instruments
and Exchange Act or Act on Investment Trusts and Investment Corporations, or any associated cabinet orders,cabinet office ordinances, rules, or any rules governing companies listed on the Tokyo Stock Exchange, or any
other applicable rules, nor is it a disclosure document or statement of financial performance prepared inaccordance with the provisions of any of the foregoing.
This document contains forward-looking statements. However, these forward-looking statements are based on
certain assumptions and judgments made using currently available information, and there are a number of
unknown risks and uncertainties. These forward-looking statements are not a guarantee of future performance ormanagement results of Daiwa Office Investment Corporation, and actual results may materially differ from any
explicit or implicit forecasts contained herein.
Although the information contained in this document is the best available at the time of publication, no assurances
can be given regarding the accuracy and certainty of this information. The content of this document may be
modified or withdrawn without prior notice.
Reproduction or use of the contents included in this document without prior approval is prohibited.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

2

Topics of the Fiscal Period ended November 2018 (26th FP)• Acquired a total of 3 properties namely Prime Kanda Building, Kita-Shinagawa Gotenyama
Building and Sasazuka NA Building for 20.2 billion yen in the 26th FP

Completion of property
acquisition utilizing 30
billion yen of surplus
funds• Completed the acquisition of properties utilizing 30 billion yen of surplus funds generated
from the large-scale asset replacement in the 25th FP
Acquisition of new
properties
20.29 billion yen+

Repayment ofloans
15.35 billion yen

+

Share
buybacks
3.67 billion yen

=

Total

39.32 billion yen• Occupancy rate continues to be at a high level of 98.9% as of the end of the 26th FP(forecasted occupancy rate as of July 2018: 98.0%)

Continuously strong
internal growth• Amount of monthly rent increase was at the highest level ever with the renewal of contracts
and occupancy by new tenants
Percentage of rent
increase upon contract
renewalRent increase/decrease
rate upon contract
renewalRent increase/decrease
rate upon tenant
replacement

Growth rate of dividend
resource(annualized)

45.8%

+9.9%

+16.0%

5.8%

For details,
please refer to page 14

For details,
please refer to page 15

For details,
please refer to page 14• Strengthening efforts on ESG being emphasized in recent years

Enhancement of efforts
on ESG

Environment
Efforts made from2011

Society
Coexistence withstakeholders

Governance
Strict and disciplined
investment policy

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

3

Use of 30 Billion Yen of Surplus Funds
 30 billion yen of surplus funds incurred with the asset replacement in the 25th FP
 Conducted the following actions totaling approximately 39.32 billion yen by the end of the 26th FP

Use of funds

1. Allot toacquisition of
new properties

Amount＜Prime Kanda Building: Kanda-Sudacho, Chiyoda-ku (1-minute walk from Iwamotocho Station on the Toei Shinjuku Line)＞
Acquisition date: June 7, 2018, Acquisition price: 1.8 billion yen, NOI yield: 3.8% (as of acquisition (Note 1))→ 4.2% (mid-term assumption (Note 2))
Acquisition date: November 1, 2018, Acquisition price: 0.495 billion yen, NOI yield: 4.2% (as of acquisition (Note 1))→ 4.5% (mid-term assumption (Note 2))＜Kita-Shinagawa Gotenyama Building: Kita-Shinagawa, Shinagawa-ku (1-minute walk from Kita-Shinagawa Station on the Keikyu Line)＞
Acquisition date: September 13, 2018, Acquisition price: 2.5 billion yen, NOI yield: 4.1% (as of acquisition (Note 3))

Approx.
20.29 billion yen→ 4.1% (mid-term assumption (Note 2))＜Sasazuka NA Building: Sasazuka, Shibuya-ku (4-minute walk from Sasazuka Station on the Keio Line and Keio New Line)＞
Acquisition date: October 30, 2018, Acquisition price: 15.5 billion yen, NOI yield: 3.7% (as of acquisition (Note 1))→ 4.5% (mid-term assumption (Note 4))

2. Allot to
repayment ofloans

3. Allot to sharebuybacks＜Repayment/early repayment of a total of 15.35 billion yen to 8 lenders＞• Repayment of a total of 1.85 billion yen to three banks (February 28, 2018)• Early repayment of 2 billion yen to a bank (March 30, 2018)15.35 billion yen• Early repayment of a total of 11.5 billion yen to five banks (April 27, 2018)• Acquisition period: March1, 2018 to May 18, 2018
• Number of acquired units: 5,992 units• Total acquisition amount: 3,675,523,000 yen

Total

Approx.
3.67 billion yen

Approx.
39.32 billion yen(Note 1) Figures calculated by dividing the expected annual balance of payments under the assumed occupancy rate (100.0%) by the acquisition price, based on the lease agreement upon acquisition, etc. while taking into account the accrual of tax and publicdue, etc. are indicated. The figures do not represent forecast figures for the current period or the next period onward.
(Note 2) Figures calculated by dividing the estimated figures for normal operation period (with assumed occupancy rate of 96.0%) afteracquisition, obtained by deducting rent business-related expenses from rent revenue assumed under rents over a medium
term, by the acquisition price are indicated. The figures do not represent forecast figures for the current period or the next period onward.
(Note 3) Figures calculated by dividing the expected annual balance of payments under the assumed occupancy rate (96.8%) by the acquisition price, based on the lease agreement upon scheduled acquisition, etc. while taking into account the accrual of tax
and public due, etc. are indicated. The figures do not represent forecast figures for the current period or the next period onward.

(Note 4) Figures calculated by dividing the estimated figures for normal operation period (with assumed occupancy rate of 96.0%) afteracquisition, obtained by deducting rent business-related expenses from rent revenue assumed under rents over a medium
term, by the acquisition price are indicated. The figures do not represent forecast figures for the current period or the next period onward.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

4

Change in Major Indices after Portfolio Replacement
Various major indices of the portfolio improved from the fiscal period ended November 2017 (24th fiscal period) to the fiscal period
ended November 2018 (26th fiscal period) due to asset replacement, internal growth and effective utilization of 30 billion yen of
surplus funds.

Major Indices

Number of property (Note 1)
Total Assets(based on total acquisition price)

NOI Yield (Note 2)
Ratio of Investment inShinjuku Maynds Tow er(Note 3)End of 24th FP
ended November 2017

End of 26th FP
ended November 2018

Fiscal period ended May 2018 (25 FP)

Fiscal period ended May 2018 (25 FP)
Fiscal period ended November 2018 (26 FP)

Assets sold

Assets acquired

54 properties

2 properties

5 properties

58 properties

469,341 million yen

72,200 million yen

62,595 million yen

459,736 million yen

4.0%

3.2%

4.3%

4.4%

28.5%

NAV per unit (Note 4)

640,587 yen

LTV

42.3%

14.6%
Shinjuku Maynds
Tower

497,869 units

Dividend per unit

10,957 yen

Daiwa Kanda East

673,841 yen

41.5%
Daiwa Meieki

Number of investment units issued
and outstanding

CONCURRED
Yokohama

Prime Kanda
Building

Kita-shinagawa
Gitenyama Building

491,877 units

Sasazuka NA
Building

11,997 yen(Note 1) Of the assets sold in the 25th FP, the sale of Shinjuku Maynds Tower is a partial sale. Therefore, the remaining owned portion is counted as 1 property in the number of properties owned as of the end of the 26th FP.
(Note 2) NOI yield is calculated using the following formula:
Numerator:
Annualized NOI does not include costs related to the Investment Corporation. Annualized actual NOI of each period is used forthe end of the 24th FP and 26th FP, annualized forecasted NOI for the 27th FP is used for NOI of assets acquired in the
25th FP and 26th FP, and annualized actual NOI for the 24th FP is used for NOI of assets sold in the 25th FP.
Denominator:
Period-end book value of each period is used for the book value for the end of the 24th FP and 26th FP and the acquisition price for the assets acquired in the 25 th FP and 26th FP.

(Note 3) The ratio of investment in Shinjuku Maynds Tower is the ratio of Shinjuku Maynds Tower’s acquisition price to the total acquisition price.
(Note 4) NAV per unit= (Unitholders’ capital +Total appraisal value at the end of fiscal period − Total property book value a t the end of fiscal period) / Number of investment units issued and outstanding.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

5Section 1
Fiscal Period ended November 2018 (26th Fiscal Period)
Performance Highlights and Forecasts

Highlights of the Fiscal Period ended November 2018 (26th FP)
Results of the 26th Fiscal Period
25th Fiscal Period(ended May 2018)

26th Fiscal Period(ended Nov . 2018)

FactorDifference

Increase
Operating Revenue

13,440 million y en

13,193 million y en

-246

million y en

Operating Expense

6,761 million y en

6,658 million y en-103

million y en

Operation Income

6,678 million y en

6,535 million y en

-143

million y en

Non-Operating Revenue

139 million y en

3 million y en

-135

million y en

Non-Operating Expense

929 million y en

636 million y en

-293

million y en

5,887 million y en

5,901 million y en

+13 million y en

Dividend per Unit (Note 1)

11,150 y en

11,997 y en

+847 y en

NAV per Unit (Note 2)

653,697 y en

673,841 y en

+20,144 y en

Net Income

Decrease

Increase

Decrease

Period End Occupancy Rate

99.0%

98.9%

-0.1%

Period Average Occupancy Rate

98.3%

99.1%

+0.8%

4.2%

4.4%

+0.2%

Decrease(Note 1) Dividends per unit for the 25th FP is calculated by dividing the amount obtained by subtracting provision for reserve for
reduction entry (403 million yen) from unappropriated retained earnings by the total number of investment units issued
and outstanding.

Decrease(Note 3)

NOI Yield (annualized) (Note 3)(Note 2) NAV per unit = (Unitholders’ capital +Total appraisal value at the end of fiscal period − Total property book value at theend of fiscal period) / Number of investment units issued and outstanding*.

Item(Note 5)
 Revenue (rents and common area fees) from 53 existing properties+405 million yen Full contribution of revenue (rents and common area fees) from 2+201 million yen

properties acquired in the previous period
 Revenue (rents and common area fees) from properties acquired
during period (3 properties)
 Utilities revenue+130 million yen+113 million yen

 Revenue (rents and common area fees) from properties sold in the-524 million yen

previous period (2 properties)
 Gain on sale of real estate in the previous period (net 2 properties)
 Dividend income for the previous period-481 million yen Utilities charges+95 million yen Tax and public due (Rent business-related expenses)-66 million yen Tax and public due (general and administrative expenses)-53 million yen Depreciation-37 million yen

 Outsourcing expenses-34 million yen

 Insurance income-135 million yen

 Insurance-related expenses
 Interest expenses-125 million yen-82 million yen-60 million yen

 Revenue (rents and common area fees) from

+79 million yen

 Expenses related to early repayment-48 million yen(Note 3) Period average occupancy rate is calculated based on occupancies at the end of months during each fiscal period.
(Note 4) NOI Yield (annualized) is calculated based on book value. NOI annualizes properties owned at the end of the period.

(Reference) Comparison of Forecasts with Results of 26th Fiscal Period
26th Fiscal Period
Forecast(announced July 2018)

26th Fiscal Period
Results(ended Nov ember 2018)

Dif f erence

56 existing properties (Note 6)

Operating Revenue

13,029 million yen

13,193 million yen+ 163 million yen

Operating Expense

6,570 million yen

6,658 million yen+ 87 million yen

Net Income

5,828 million yen

5,901 million yen+ 72 million yen

11,850 y en

11,997 y en

+147 y en(Note 5) 53 existing properties are the 58 properties as of the end of the 26th FP less the 2 properties acquired in the 25th FP
and the 3 properties acquired in the 26th FP. The 3/7 ratio of Shinjuku Maynds Tower is incorporated.

98.0%

98.9%

+0.9%

(Note 6) 56 existing properties are the 58 properties as of the end of the 26th FP less the 2 properties acquired in the 26th FP(additional acquisition of Prime Kanda Building and Sasazuka NA Building).

Increase Revenue (rents and common area fees) from properties acquired

during period (2 properties)

Dividend per Unit
Occupancy Rate

+72 million yen

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

7

Highlights of Forecasts for the Fiscal Periods ending May 2019 andNovember 2019 (27th and 28th FP)
The 27th Fiscal Period (Forecast)

Factor Full contribution of revenue (rents and common area fees) from 3

Difference from26th FP

27th FP Forecast
Ending May 2019

properties acquired in the previous period

Increase
Operating Revenue

13,679 million y en

+485 million y en

Operating Expense

6,820 million y en

+162 million y en

Operation Income

6,858 million y en

+323 million y en

663 million y en

+26 million y en

Non-Operating Expense
Net Income

6,193 million y en

+292 million y en

12,300 y en

+303 y en

Period End Occupancy Rate

97.6%

-1.3%

Period Average Occupancy Rate (Note 1)

98.7%

-0.4%

NOI Yield (annualized) (Note 2)

4.4%

+0.0%

Dividend per Unit

Item

Decrease+143 million yen

 Revenue (rents and common area fees) from existing properties (Note 3)+140 million yen

 Revenue (rents and common area fees) from 1 property acquired in-116 million yen

the previous period and property sold in the previous period (netproperty) Utilities revenue

 Repair cost

Increase

Decrease+368 million yen

 Gain on sale of real estate-79 million yen Tax and public due (general and administrative expenses)+58 million yen+57 million yen+33 million yen+24 million yen Utilities charges-23 million yen Depreciation
 Asset management fee

Dividends per unit for the 27th FP is calculated by dividing the amount obtained by subtracting provision
for reserve for reduction entry (143 million yen) from unappropriated retained earnings by the total
number of investment units issued and outstanding.

The 28th Fiscal Period (Forecast)
28th FP Forecast
Ending November 2019

Difference from27th FP

Increase Utilities revenue+117 million yen

 Gain on sale of real estate-143 million yen-125 million yen

 Revenue (rents and common area fees) from 1 property acquired in

Operating Revenue

13,550 million y en

-128 million y en

Operating Expense

6,776 million y en

-43 million y en

Operation Income

6,774 million y en

-84 million y en

672 million y en

+9 million y en

6,099 million y en

-93 million y en

12,400 y en

+100 y en

97.8%

+0.2%

98.0%

-0.7%

(Note 2) Expected NOI Yield (annualized) is calculated by taking into account the properties assumed to be acquired and soldduring the 27th FP based on the book value for the 26th FP.

4.4%

+0.0%

(Note 3) Existing properties are the 58 properties as of the end of the 26th FP less 1 property to be acquired and properties
assumed to be sold during the 27th FP.

Non-Operating Expense
Net Income
Dividend per Unit
Period End Occupancy Rate
Period Average Occupancy RateNOI Yield (annualized)(Note 2)

(Note 1)

Decrease

Increase

the previous period and property sold in the previous period (netproperty) Revenue (rents and common area fees) from existing properties (Note 3)

 Tax and public due (Rent business-related expenses)
 Utilities charges
 Repair cost

Decrease Outsourcing expense Tax and public due (general and administrative expenses)-74 million yen+86 million yen+82 million yen-142 million yen-42 million yen-21 million yen(Note 1) Expected period average occupancy rate is calculated based on occupancies at the end of months during each fiscal
period.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

8

Changes in Dividends
Changes in Dividends per Unit (forecast/actual)

(yen)

(yen)

10,770

6,009

3,903

3,176

3,280

4,100

4,850

5,500

6,250

7,200

7,540

7,820

8,700

9,350

9,850

10,55010,70011,000

7,400

4,154

2,843

3,180

3,600

4,850

5,350

5,500

6,550

7,300

7,570

8,328

9,000

9,750

9,900

10,560 10,710 10,800 11,400 12,000

11,85012,30012,400This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

9Section 2
Internal Growth

Leasing Market of Tokyo Office Buildings
Trend of Office Rent and Vacancy Rate of
5 Central Wards of Tokyo

Leasing Market of Tokyo Office Buildings(Yen/Tsubo)

24,00010.0%

22,000

8.0%

Rent(Yen/Tsubo)

35,000Rent and vacancy rate of large-scale office buildings (Note 1)of 5 Central Wards of Tokyo
Feb. 2008(Rent)

20,604 yen

20,000

6.0%

33,00018,0004.0%

31,000Dec. 2018

2.0%

16,0001.85%

14,0000.0%

Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan. Jan.
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Rental Market Clock(conceptual chart)

29,000Jun. 2018
Dec. 2017
Jun. 2017

27,000Jun. 2010
Jan. 2004

Jun. 2016(Data): Miki Shoji

25,000

Office Building Market Medium-term Forecast

500,000
500,000
500,000

Predicted figures(Note)

400,000
400,000
400,000

10.0%
10.0%

0%

8.0%
8.0%

300,000
300,000
300,000

6.0%
6.0%

Rent
(Yen/Tsubo)

200,000
200,000
200,000

4.0%
4.0%

19,00019,000100,000
100,000
100,000

2.0%
2.0%

0
0000

0.0%
0.0%

-100,000
100,000
100,000)
2000

New supply (Grade A, etc.)

New supply (Other)

Floor area of new demands

Vacancy rate

2002

2004

2006

2008

2010

2012

New supply (Entire properties)

2014

2016

2018

2020

2022

'002001'01 '022003'03 '042005'05 '062007'07 '082009'09 '102011'11 '122013'13 '142015'15 '162017'17 '182019'19 '20 2021
'21 '22

-2.0%
-2.0%

20,00020,000Jul. 2012

Dec. 2011

23,000(Tsubo)

1%

2%

3%

5%

6%

7%

8% Vacancy rate

Average rent and vacancy rate of entire office buildings (Note 2)of 5 Central Wards of Tokyo
Sep. 2008

Dec. 2018

18,00018,00017,00017,0004%

Jun.. 2018

16,00016,00015,00015,000Sep. 2007
Dec. 2017
Jun. 2017

Jan. 2004

Jun. 2016

Jul. 2012

14,00014,000
0%
0%

1%
1%

2%
2%

3%
3%

4%
4%

5%
5%

(Data): CBRE “Office market medium term forecast 2018-2022(Data): Sanko Estate, compiled by Daiwa Real Estate Asset Management(Note) Predicted figures as of July 2018

(Note 1) Large-scale office buildings: A floor area of 200 tsubos or more.

6%
6%

7%
7%

8%
8%

9% Vacancy rate
9%(Note 2) Entire office buildings: Ranging from large-scale buildings to small-scale buildings (less than 20 tsubos).

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

11Analyses of Leasing Income (1)― Transition of Occupancy and New Leases / Cancellations Rates ―Transition of New Leases and Cancellations and
Its Reasons (Note 2)

Period-end Occupancy Rate(%)

(Cases)9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th 28th
FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP

Rate of New Leases and Cancellations (Note 1)

9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th
FP FP FP FP FP FP FP FP FP FP FP FP FPFPFP FP FPFP

26th Period

9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th 28th
FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP(Note 1) Transition of rate of new leases and cancellations areas to the total leasable area.

Cost
Space
Consolidati
Space
Reduction Expansion on Space Reduction

BetterLocation

Other

Total

New Leases

0

19

1

0

3

2

25

Cancellations

3

2

6

7

0

2

20

Previous number of leases

23(Note 2) Excluding new leases and cancellations by residence and warehouse tenants.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

12Analyses of Leasing Income (2)― Improvement in Basic Strength ― The amount of monthly rent increase due to contract renewal and occupancy of new tenants is at the highest

level ever
 Increase in rent revenue due to improved basic strength leads almost directly to an increase in dividend resource
Monthly Rent Increase Due to Contract Renewal/Occupancy of New Tenants(Thousand Yen/Month)
30,00025,000Contract Renewal

6,680

20,00014,37615,00010,0005,000

Occupancy of new tenants

9,020

14,246
766

6,438

3,157

7,938

19th FP

20th FP

21,3099,137

18,407
6,265

12,521
19,087

18,847
14,371

13,4795,862

21,804
7,432

12,747
3,988

28,22525,52812,141

8,787

8,759

0
21st FP

22nd FP

23rd FP

24th FP

25th FP

26th FP

Increase Rate of Dividend Resource due to Improved Basic Strength

Percentage ofTotal Rent
Revenue(rents andcommon areafees)

19th FP

20th FP

21st FP

22nd FP

23rd FP

24th FP

25th FP

26th FP

Simple averageforSimpleaveragefiscalperiodforthethe
19thFP
ended May 2015 onward
onward6 m onths

0.7%

1.0%

0.8%

0.7%

1.4%

1.2%

1.2%

1.5%

1.0%

Annualized

1.3%

2.0%

1.7%

1.5%

2.8%

2.4%

2.3%

3.0%

2.1%

6 m onths

1.5%

2.1%

1.8%

1.5%

2.9%

2.4%

2.3%

2.9%

2.2%

Annualized

3.0%

4.3%

3.6%

2.9%

5.8%

4.9%

4.7%

5.8%

4.4%

(Note 1)

Growth rate ofdividend resource

SimpleSimpleaverageaverageforforthe fiscal
theperiod
19th FP
endedonward
May 2015
onward(Note 2)

(Note 1) Obtained by dividing the amount of rent increase (increased amount of monthly rent x 6 months) due to the improved bas ic strength in each fiscal period by rent revenue (rents and common area fees) in the previous fiscal period to the respective fiscal
period.
(Note 2) Obtained by dividing the amount of rent increase (increased amount of monthly rent x 6 months) due to the improved basi c strength in each fiscal period by net income in the previous fiscal period to the respective fiscal period.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

13

Analyses of Leasing Income (3)― Changes in Rent Increase/Decrease Rate of Contract Renewal Tenants ―The 26th Fiscal Period Contract Renewal Tenants*The ratio of areas for which contract was renewed in the 26th FP (through November 2018) to the total
leasable area (336,760.45 m²) as of end of May. 2018.

Changes in Rent Increase/Decrease Rate of Contract Renewal Tenants(sections)
Realized upward rent revisions for
10 consecutive periods*2*1(Note) The above indicates rent increase/decrease rate to pre-renewal rents for lease contracts which reached renewed
agreements during each FP.
Rent increase/decrease rate is calculated based on net amount for increased/decreased rents.

Rent Increase Rate Upon Contract Renewal*1 Of the increase in the 17th FP, 14.1% was due to some tenants’ switching from sublease to master lease agreements and7.9% was thanks to negotiations with tenants.

(Breakdown of upward revision magnitude for monthly rents in the 26th FP)*2 The decrease in the 25th FP was due to some tenants’ switching from sublease to master lease agreements.

Properties with rent increase

Contract Renewal Periods (based on leased area)
Forecasts

2% or less22%

 Daiwa Higashi-Ikebukuro Daiwa Tsukijiekimae

15% or more
25%

 E SPACE TOWER
 shinyon curumu

2% or more but
less than 5%
10%

Increase rateof monthly rent
9.9 %(Previous FP: 6.6%)

5% or more but
less than 10%27% Daiwa Shibuya Miyamasuzaka Integral Tower
 Daiwa Azabu Terrace

10% or more but
less than 15%
17% Glass City Shibuya
 Daiwa River Gate
 Daiwa Nishi-Shinjuku Building,etc.

Increased amount of monthly rent
19,087 thousand yen/month(Note) The ratio of areas scheduled for contract renewal in each period to the total leased area (357,153.44㎡)
as of November 30, 2018.

(Note) Percentage figures are based on total monthly rent.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

14Analyses of Leasing Income (4)― Increase/Decrease in Rent Due to New Leases and Cancellations ―Monthly Rent Increase/Decrease and Increase/Decrease
Rate Due to Occupancy of New Tenants

Average Contract Rent and Market Rent
(Yen/Tsubo)

83.52

84.79

82.30

(Total Monthly Rent, Thousand Yen)

91,394
83,962

96,294
83,772

19,29516.0%
75,943
69,262

19,574

19,237

14.9%
66,10456,96759,04255,054

5th 6th 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th
FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP
End
End

9.6%
7.2%
29,97029,203(Note 1) Average contract rent is the average of monthly contract rent from tenants at the end of each fiscal period.
(Note 2) Unit rent index is the earning rates of unit rent of individual properties indexed with the figure at the end of the 7th FP
as 100.

8.9%

2.6%

Increase/Decrease in Monthly Contract Rent (Note)
Compared with the End of the Previous Fiscal Period(Million Yen)

Increase by
New Leases(Note) Comparison of monthly rent due to tenant replacement for the same leasing area.
Ratio is based on total monthly rent.

Increase byRent Revisions

Properties with rent increase due to occupancy of
new tenants during 26th fiscal period
 Daiwa A Hamamatsucho Daiwa Jingumae

 Daiwa Nihonbashi Horidomecho

 Shinjuku Maynds Tower

 E SPACE TOWER

 Daiwa Akasaka Daiwa Shibuya Miyamasuzaka Daiwa Kanda East,

Increase by
New Acquisition

Decrease byRent Revisions

Decrease by
Tenants’ Cancellations

etc.

Increased amount of monthly rent
9,137 thousand yen/month

End of 25th FP
Monthly Contract Rent

End of 26th FP
Monthly Contract Rent

(Note) Monthly Contact Rent is a total of final rent from contracting tenants at the end of the fiscal period.
Monthly contract rent for Shinjuku Maynds Tower was adjusted to 3/7 and monthly contract rent for CONCURRED
Yokohama was adjusted to 75/100.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

15

Portfolio Map: Increase and Decrease in Unit Contract Rent Compared with
Previous Fiscal Period
Five Central Wards of Tokyo
Comparison with Previous Fiscal Period
Increase and Decrease of Unit Contract Rent

Greater Tokyo

Unit rent increase: 30
The number in ● indicates increase for the consecutive period
2 indicates increase for the second consecutive period)(Ex: ●

Toshima
Ward

Unit rent maintained: 21

Daiwa Higashi-Ikebukuro
Integral Tower 5
Daiwa Ogikubo 2
Daiwa Meguro Square 4
Daiwa Osaki 3-chome

Unit rent decrease: 4

LAQUAS
Higashi Shinjuku

Shinjuku Ward

Shinjuku West Building
Daiwa Nishi-Shinjuku
Shinjuku Maynds Tower

6

Daiwa Misakicho
Daiwa Sarugakucho
Daiwa Jimbocho
Daiwa Jinbocho 3-chome
Daiwa
Kanda
Mikuracho
ChiyodaWardshinyon curumu
Daiwa Nihonbashi
Hongokucho

Daiwa Kojimachi
4-chome

Shibuya Ward

Daiwa SHIBUYA EDGE7E SPACE TOWER 9
Shinsen Place
Glass City Shibuya 3
Square Daikanyama Building

2 Daiwa Higashi-Nihonbashi
Daiwa Kodenmacho

3 Daiwa

Shinagawa North

CONCURRED Yokohama

Daiwa Kamiooka

Daiwa Nihonbashi Horidomecho

Kirin Nihonbashi Building
Daiwa Kayabacho Build.
Chuo Ward
Koto Ward
Daiwa Kyobashi
Daiwa River Gate
Daiwa Hatchobori ekimae
2
5
Daiwa Hatchobori ekimae West
Daiwa Ginza Annex
Daiwa Tsukijiekimae
Daiwa Aoyama
Daiwa Ginza 11
Daiwa Minami Aoyama
Daiwa Tsukiji
Daiwa
Shibuya Miyamasuzaka
Daiwa
4
Shimbashi
510
7
Daiwa Nishi-Shimbashi
Daiwa Tsukishima
Daiwa Onarimon
Daiwa Jingumae

Sasazuka NA Building
Sasazuka South Building

Prime Kanda Building
Daiwa Kanda East

Kita-Shinagawa
Gotenyama Building

Daiwa Azabudai

Minato Ward

Daiwa Ebisu 4-chomeTokyo

Daiwa Akasaka

Daiwa A Hamamatsucho
Daiwa Shibadaimon
Daiwa Shibaura

Daiwa Azabu Terrace
Daiwa Kitahama

Shinagawa
Ward

Regional Major Cities
As of November 30, 2018

(Note) Properties acquired in the 26th FP and 27th FP are plotted with ●.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

16Percentage of Properties by Region and Status in Shinjuku andShibuya Areas
Shinjuku Maynds Tower

Percentage of Properties by Region
Osaka City
2.0％

Yokohama City
8.7％
Other 23 Wardof Tokyo
8.5％
Chiyoda Ward
5.2％

Minato Ward
13.8％

Shinjuku Maynds Tower Occupancy Rate（％）

Regional Cities
2.0％
Greater Tokyo
17.2％

Shibuya Ward
35.0％

Shibuya Ward/
Shinjuku Ward
Ratio
42.1％
Five Central Wardsof Tokyo
80.8％

Shinjuku Ward
7.1％

Chuo Ward
19.6％

Location

2-chome, Yoyogi,
Shibuya-ku

Acquisition
price66,900 million yen

12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th 28th
FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP
End
End*1 Based on acquisition price(As of January 22, 2019)*2 Percentage is rounded to the first decimal place

E SPACE TOWER

Large-scale Office Building Supply inthe 23 Wards of Tokyo

E SPACE TOWER Occupancy Rate

2018―2022（％）

Total from 2018 to 2022

5,040,000 m²
Other770,000m²
Shibuya Ward
390,000 m²

Chiyoda Ward
1,640,000m²

Shinjuku Ward
220,000 m²
Minato Ward
1,300,000m²

Chuo Ward
720,000m²

Location

3 Maruyama-cho,Shibuya-ku

Acquisition
price

24,000 million yen

12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th 28th
FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP FP
End
End

Source: Mori Trust
Large-scale properties: Offices with total floor areas of 10,000m² or more

(Note) Rent revenue is indexed as 11/11 = 100. Ownership interest of Shinjuku Maynds Tower is adjusted from the 25th FP.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

17Internal Growth Strategies
Continuous Internal Growth andMaximization of Asset Value through “Bonji-Tettei”

Office Management Team (8 members)
Aims at maximizing asset value by means of specialist groups headed by personnel assigned toeach property in the Investment Corporation’s portfolio.

 Accurate understanding of the leasing market

Grasp ofpresent
situations

 Grasping of needs and trends of occupying

Hiroshi Udagawa

Takafumi Ushiku

Kotaro Ishii

Jun Arai

Asset management work history:
12 years 6 months

Asset management work history:
14 years 4 months

Asset management work history:
12 years 9 month

Asset management work history:
12 years 9 monthtenants through regular visits In-depth understanding of property features
 Information gathering from brokers
 Implementing tenant satisfaction surveys

Activities forinternal growthand proposing improvement measures Periodical property examination

Chie Kamimura

Yuuki Kobatake

Jun Iwasaki

Takeshi Morikawa

Asset management work history:
12 years 7 months

Asset management work history:
6 years 3 month

Asset management work history:
2 year 3 month

Asset management work history:
2 monthConstruction Management Team (5 members)
 Maintenance of a stable occupancy rate by

Realization ofinternal growth

promptly filling vacancies
 Realization of stable management throughsolid relationship with tenants
 Securement of revenue based on wellplanned management

Engineering: Formulation and implementation of construction planning of the assets.

Koji Ozeki

Naoki Murayama

Kazuyoshi Ono

Takahiro Hirabayashi

Junpei Takaya

Asset management work history: Asset management work history: Asset management work history: Asset management work history: Asset management work history:
12 years 8 months
3 years 7 months
12 years 2 months
3 years 8 months
5 years 8 months

Aims to maximize asset value(Note) “Asset management work history” is the number of years engaged in the relevant work (as of January 22, 2019) and does
not indicate the number of years employed at the asset management company.

Investment Planning Team (4 members)
Middle office work: Budget and performance management for the portfolios

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

18

Occupancy Status of Properties Subject to Leasing Improvement in
the Fiscal Period ended November 2018 (26th FP)
CONCURRED Yokohama(Acquisition Price: 38,100 million yen)

Square Daikanyama(Acquisition Price: 2,280 million yen)

Locateda a5-minute3-minute walk Locatedwalk from
from
HatchoboriStation
Station whereon the JR
Yokohama
12Keiyolines Lineareand Tokyo Metro Hibiya Line as well asavailable
including the JR lines.
a 6-minute walk from Kyobashi Station
 The
EastGinza
Exit Area
onYokohama
the Tokyo Metro
Line. whereproperty
is locatedhigher istheVisibility
is excellent
as hasthe property
officestock
qualitythan thelocatedat theintersectionof Kajibashi
Yokohama
Exit Area
where
Dori streetWest
and Heisei
Dori street.
and medium
buildings
smallA large-scalerenovation
wasconcentrateandtransportation
implemented
in 2005.

Located aabout
2-minute
walk from
Jimbocho Locateda 7-minute
walk
from
Station on theStation
Tokyo onMetro
Daikanyama
the Hanzomon
TokyuLine and the Tokyo Municipal Subway
ToyokoLine.
Shinjuku Line and Mita Line as well as a
 Thereisdemandvarious3-minute walkfrom from
Kudanshita
Station on
the Tokyo Metro
Hanzomoncompanies
includingforeign Line andTokyo Municipal
SubwayLine.
companies
focusing
onShinjuku
a relaxing
environment,
centeringon IT workThe property
is locatedalong Yasukuni
Dori street andhas a stylishcompanies
locatedin the exterior
Shibuyacoveredwith wholesurface glass sasharea
in large
number.
which makes it highly visible.

convenience is evaluated higher thanthe Minato Mirai Area as it offers
access to Yokohama Station.
Location

Kinko-cho, Kanagawa-ku, Yokohama-shi, Kanagawa

Location

Daikanyamacho, Shibuya-ku, Tokyo

Site Area

7,140.99 m²

Site Area

503.72 m²

Structure

S/SRC

Structure

S

Floor

B1/20F

Floor

6F

Use

Office/store/assembly hall/parking

Use

Office/store

Total Floor Area

53,772.50 m²

Total Floor Area

1,989.40 m²

Construction Date

February 2008

Construction Date

March 2001

Occupancy rate (%)

Occupancy rate (%)

Upon acquisition

 The Property is located near Yokohama Station and successfully

obtained multiple needs as a result of appealing the transportation
convenience of being accessible to multiple lines and its high grade.
Also received applications for occupancy of the remaining 68.60
tsubos of area and lease contracts are scheduled to be concluded.
 Occupancy rate as of the end of the 26th FP is 99.3%.

 Advertised to a broad area between Daikanyama and Shibuya

utilizing the limited supply of single-building case in Daikanyama.
Received multiple applications for occupancy and concluded
contract for the entire property. Unit rent increased without
downtime.
 Forecasted occupancy rate as of the end of February 2019 is 100%

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

19

Properties Subject to Leasing Improvement in
the Fiscal Period ending May 2019 (27th FP)
Kita-Shinagawa Gotenyama Building(Acquisition Price: 2,500 million yen)

Daiwa Jingumae(Acquisition Price: 2,800 million yen)

Glass City Shibuya(Acquisition Price: 16,000 million yen)

 Located a 7-minute walk

The Property is a 10-minute walkfrom Shinagawa Station on the
JR Yamanote Line, JR Keihin
Tohoku Line and JR TokaidoLine and a 1-minute walk from
Kita-Shinagawa Station on the
Keikyu Line.

 Located a 9-minute walkfrom Gaienmae Stationon the Tokyo Metro GinzaLine.

from Shibuya Station on
the JR Yamanote Line.
 Demand from various

 An office building withcompanies including ITrelated companies,
wholesalers and retailers
as well as creative
tenants such as offices
attracting clients, worker
dispatch business,
designer offices andmusic and video-related
tenants are assumed.

high visibility facing
Gaien-Nishi Dori street. It
has low-rise and welldesigned exterior as well
as a rectangle-shaped
rental space with nopillars.

Needs for headquarters,
branches and business offices inTokyo from companies
developing businesses
nationwide and emphasizing
wide-area traffic convenience aswell as demand for back-offices
from companies that have basesin large buildings in theneighboring areas can be
expected.

Location

Kita-Shinagawa, Shinagawa-ku, Tokyo

Location

Jingumae, Shibuya-ku, Tokyo

Location

Nanpeidaicho, Shibuya-ku, Tokyo

Site Area

602.41 m²

Site Area

887.69 m²

Site Area

2,452.64 m²

Structure

SRC/S

Structure

RC

Structure

S/SRC

Floor

8F

Floor

B1/4F

Floor

B1/11F

Use

Office/parking

Use

OfficeUse

OfficeTotal Floor Area

2,897.64 m²

Total Floor Area

2,673.88 m²

Total Floor Area

10,639.97 m²

OfficeOccupancy Rate

58.6% (as of November 30, 2018)

Occupancy Rate

78.5% (as of November 30, 2018)

Occupancy Rate

100.0% (as of November 30, 2018)⇒ 49.0% (scheduled for May 2019)

Construction Date

July 1992

Construction Date

December 1997

Construction Date

February 2004

 Needs for back-offices from large companies around Shinagawa

 A property with suitably refined design in the Aoyama area where

Station centering on needs for bases from companies coveringfrom Southern Tokyo to the airport and bay area are assumed.

redevelopments for the Tokyo Olympic Games are underway as
well as stately appearance.

 Aim

for early lease-up by improving the management system
immediately after the acquisition and utilizing the leasing network.

 Aim to conclude contracts at a higher unit rent by utilizing free rent

if necessary.

 Needs from creative tenants such as IT-related, worker dispatch

business and music and video-related tenants are assumed.
 The Property has a rectangular and regular-shaped typical floor

with no pillars and is competitive due to flexible layout and efficient
use.
 Aim

to attract tenants that can occupy the Property over the
medium-to long-term while receiving multiple inquiries.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

20

Purpose of Large-scale Repair Work and Cases of Construction Work in the
Fiscal Period ended November 2018
Purpose of Large-Scale Repair Work
Established medium- to long-term plans for the purpose ofmaintaining and restoring the functions of properties as well
as examined the following items and conducted large-scale
repair work in a timely and appropriate manner upon
considering construction work.
1.

Cases of Construction Work in the Fiscal Period ended November 2018
Daiwa Akasaka

Conducted renewal work changing from central to individual air
conditioning system (abolition of regional heating and coolingsystem).



Realized rent increase by fulfilling tenant needs with the
improvement of convenience in the use of air conditioners by tenants.

Contributed to the reduction of utility charges (reduction of electricity
charges and abolition of regional heating and cooling system) with
the introduction of the latest highly efficient devices.



Improvement of profitability was evaluated and increase in appraisal
value was also realized.

Value enhancement

 Construction work aiming to improve future profitability with thestrengthening of competitiveness of properties including renewal of
air conditioning facilities.

3.



Cost reduction

 Construction work leading to the reduction of owner cost with the
reduction of utility charges by renewing air conditioners andutilization of reused water facilities.

2.

Value enhancement through renewal work of
air conditioners

Response to tenant needs

 CS construction work for improving environment of tenants including
air conditioners and toilets.

Impact on appraised net operating revenue

Impact on appraisal value⇒ Operating revenue has been on an upward trend fromthe 24th FP. Reduction of operating expenses was
realized with the decrease in utility charges due toconstruction work

⇒ Appraisal value as of the end of the 26th FP increased
by 9.5% from the 24th FP (no change in cap rate)
Contributed to the improvement of property value with
the improvement of profitability

Change in appraised net operating revenue, etc.

Change in appraisal value(100 million yen)

Increase in net operating revenue+13

4.

Response to qualitative improvement of the environment
Decrease in cap rate+12

 Construction work leading to the improvement of environmental
performance including the introduction of green leasing (installationof LED lighting in areas exclusively occupied by the tenant).

5.

Response to social changes

 Construction work responding to social changes including IT-related
facilities and barrier-free layout.
(Note) Indexed with the figure at the 21st FP as 100

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

21Section 3External Growth

Acquisition/Sale Policy and Status of Deliberation for Property Acquisitions
Distribution Chart of Portfolio Properties

Acquisition/Sale Policy







Places priority in the five central wards of Tokyo and equivalent area.
Thoroughly select properties in view of actual demand toward
location (distance to station, station power, crowd attraction,
surrounding environment), building specs, etc.
Target properties to improve growth potential and profitability ofexisting portfolio.
Invest in buildings less than 25 years of building age.
Consider replacements when necessary in consideration of futurecompetitiveness, profitability, etc. of properties.

Building Age (Year)

Sourcing Strategy Capitalizing on Status as Non-Real
Estate Sponsored REITSecure a sourcing route across a wide range by capitalizing on status
as an independent style REIT and establishing strong relations withbusiness companies, financial institutions, real estate brokers, etc.
Target optimum expansion of portfolio based on in-depth data
analysis upon careful selection from among the wide-ranging
information on properties that comes from diverse sources.
Number of Properties Reviewed for Acquisition*Number of gross proposals.

Distance to station (minutes)
This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

23

Newly Acquired Properties in the Fiscal Period ended November 2018 (1)Prime Kanda Building

Kita-Shinagawa Gotenyama Building① Acquisition price: 1,800 million yen, Acquisition date: June 7, 2018
② Acquisition price: 495 million yen, Acquisition date: November 1, 2018

Acquisition price: 2,500 million yen, Acquisition date: September 13, 2018

Owns entire building throughtwo separate acquisitions

Location/Distance from
StationConstruction Date
/Building Age

Kita Shinagawa Shinagawa-ku, Tokyo
1 minute
July 20, 1992
26.3 years*

Location/Distance from
StationAppraisal Value (Note 1) 2,620 million yen (Note 1)

Site Area

Kanda-Sudacho, Chiyoda-ku, Tokyo
1 minute

Appraisal Value

Total
Acquisition price

2,295Million yen

Appraisal Value (Note 2)

2,700Million yen① 1,940 million yen (Note 1)② 604 million yen (Note 1)
Site area of entire
building

602.41 m²

Construction Date
/Building Age

Structure/Floor

SRC/S / 8F

Total Floor Area

2,897.64 m²

Occupancy Rate

86.2% (as of acquisition)

Number of Tenant

4 (as of acquisition)

August 30, 1990
28.2 years*

Land area(right of site)

302.42 m²① 1,519,380/1,814,520(approx. 83.73%)

Ratio of right of site

② 295,140/1,814,520(approx. 16.27%)

Total floor area of entire
building

Upon
Acquisition (Note 2)

NOI Yield

Occupancy RateNOI Yield

4.1%

96.0%

NOI Yield

Occupancy Rate

4.5%

96.0%

Structure/Floor
4.1%

Transportation access• The Property is a 10-minute walk from Shinagawa
Station on the JR Yamanote Line, JR Keihin Tohoku
Line and JR Tokaido Line and a 1-minute walk from
Kita-Shinagawa Station on the Keikyu Line.
Property overview• The Property has eight floors above ground with a
total floor area of 2,897.64 m² and a leasable areaof approximately 100 tsubos per floor is secured. It
has 2,550 mm of typical floor celling height, 50 mm
of OA floor and facilities including individual air
conditioners. It has rectangle-shaped (roughly
regular-shaped) rental spaces with a side core
design, thus offering excellent layout flexibility andusability.

S/RC / B1 / 10F

96.0%
Occupancy Rate

Depreciation (Note 4)

Appraisal①② 100.0% (as of acquisition)

Number of Tenant

Co-ownership interest of
exclusive space andcommon space① 6, ② 3

2,435.80 m²① 1,716.51㎡ (77.27%)② 504.16㎡ (22.73%)(as of acquisition)

0.5%
Upon
Acquisition (Note 2)(Note 1) As of June 1, 2018
(Note 2) Figures calculated by dividing the expected annual balance of
payments under the assumed occupancy rate (96.0%) by theacquisition price, based on the lease agreement uponacquisition, etc. while taking into account the accrual of tax andpublic due, etc. are indicated. The figures do not represent
forecast figures for the current period or the next period onward.
(Note 3) Figures calculated by dividing the estimated figures for normal
operation period (with assumed occupancy rate of 96.0%) after
acquisition, obtained by deducting rent business-related
expenses from rent revenue assumed under rents over a
medium term, by the acquisition price are indicated. The figures
do not represent forecast figures for the current period or the
next period onward.
(Note 4) Depreciation indicates a figure obtained by dividing the total
amount of depreciation (6 month equivalent) expected to beposted upon property acquisition and depreciation (for 6
months) expected to be posted in the following fiscal period by
the acquisition price. The figures do not represent forecast
figures for the current period or the next period onward.
* As of the end of November 2018

Building area(compartmentalized
ownership)

Occupancy Rate

Mid-term (Note 3)

Appraisal

NOI Yield

Occupancy Rate

① 3.8%, ② 4.2%①② 100%NOI Yield

Occupancy Rate

① 4.5%, ② 4.8%①② 95.0%

Transportation access• The Property is a one-minute walk from Iwamotocho
Station on the Toei Subway Shinjuku Line.
Property overview• The Property has 10 floors above ground and one
below with a gross floor area of 2,435.80 m² and aleasable area of approximately 70 tsubos per floor issecured. It is equipped with an OA floor, individual
air conditioning and other facilities. Since the officespace is without pillars, flexible layout and efficientuse is possible.

Mid-term (Note 3)

NOI Yield

Occupancy Rate

① 4.2%, ② 4.5%

① 96.0%, ② 96.0%

Depreciation (Note 4)① 0.5%② 0.8%(Note 1) ① As of May 1, 2018

② As of October 1, 2018

(Note 2) Figures calculated by dividing the expected annual balance of payments
under the assumed occupancy rate (100.0%) by the acquisition price,based on the lease agreement upon acquisition, etc. while taking into
account the accrual of tax and public due, etc. are indicated. The figures
do not represent forecast figures for the current period or the next period
onward.
(Note 3) Figures calculated by dividing the estimated figures for normal operation
period (with assumed occupancy rate of 96.0%) after acquisition,
obtained by deducting rent business-related expenses from rent revenue
assumed under rents over a medium term, by the acquisition price areindicated. The figures do not represent forecast figures for the current
period or the next period onward.
(Note 4) Depreciation indicates a figure obtained by dividing the total amount ofdepreciation (6 month equivalent) expected to be posted upon property
acquisition and depreciation (for 6 months) expected to be posted in thefollowing fiscal period by the acquisition price. The figures do not
represent forecast figures for the current period or the next period onward.
* As of the end of November 2018

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

24Newly Acquired Properties in the Fiscal Period ended November 2018 (2)Sasazuka NA Building Acquisition price: 15,500 million yen, Acquisition date: October 30, 2018
Transportation access• The Property is a 4-minute walk from Sasazuka Station on the Keio Line and Keio New Line. The
location is excellent considering that Sasazuka Station is only 5 minutes from Shinjuku Station,and from the point of proximity to the terminal station.
• The Sasazuka area where the Property stands has head offices, laboratories, etc. of new IT
startups. Being relatively close to Shinjuku, the area is likely to expect demand for back offices
from construction-related companies and companies which have head offices in Shinjuku.
Property overview• The Property has 18 floors above ground and two below with a gross floor area of 26,527.62 m²
and a leasable area of approximately 215 tsubo per floor is secured. It is equipped with 2,650 mmof typical floor celling height and 70 mm of OA floor. The office has a regular-shaped rental space,offering excellent layout flexibility and usability. The aboveground portion is divided into the highrise building with 18 floors above ground (office/store) and the low-rise building with three floors
above ground (fitness/store) but both buildings are connected through the underground portion
and an access-way has also been established on the second floor above ground.
• Even after surpassing 25 years since its completion, the property has been appropriately
maintained and managed, and will stay competitive from here on out without lagging behindproperties in the surrounding area through systematic facility renewal after the acquisition.
(Note 1) As of October 1, 2018

Location/Distance from Station

Sasazuka Shibuya-ku, Tokyo
4 minute

Appraisal Value (Note 1)

Construction Date
/Building Age

February 15, 1993
25.8 years*

Land Area

4,795.26 m²

Structure/Floor

SRC/RC/S / B2/18F

Building Area

26,527.62 m²

Occupancy Rate

100.0% (as of acquisition)NOI Yield

Number of Tenant

Occupancy Rate

Upon Acquisition (Note 2)(Note 2) Figures calculated by dividing the expected annual balanceof payments under the assumed occupancy rate (100.0%)
by the acquisition price, based on the lease agreement
upon acquisition, etc. while taking into account the accrualof tax and public due, etc. are indicated. The figures do not
represent forecast figures for the current period or the next
period onward.

16,100 million yen

5 (as of acquisition)NOI Yield

Occupancy Rate

Mid-term (Note 3)
3.7%

100.0%NOI Yield

Occupancy Rate

4.5%

Depreciation (Note 4)

Appraisal
4.5%

96.8%

0.7%

(Note 3) Figures calculated by dividing the estimated figures fornormal operation period (with assumed occupancy rate of
96.8%) after acquisition, obtained by deducting rent
business-related expenses from rent revenue assumed
under rents over a medium term, by the acquisition priceare indicated. The figures do not represent forecast figures
for the current period or the next period onward.
(Note 4) Depreciation indicates a figure obtained by dividing thetotal amount of depreciation (6 month equivalent) expected
to be posted upon property acquisition and depreciation(for 6 months) expected to be posted in the following fiscal
period by the acquisition price. The figures do not
represent forecast figures for the current period or the next
period onward.
* As of the end of November 2018

96.0%

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

25

Newly Acquired Properties in the Fiscal Period ending May 2019
Sasazuka South Building Acquisition price: 3,000 million yen, Acquisition date: December 27, 2018
Transportation access• The Property is a 7-minute walk from Sasazuka Station on the Keio Line and Keio New Line. The
location is excellent considering that Sasazuka Station is only 5 minutes from Shinjuku Station,and from the point of proximity to the terminal station.
• The Sasazuka area where the Property stands has head offices, laboratories, etc. of new IT
startups. Being relatively close to Shinjuku, the area is likely to expect demand for back offices
from construction-related companies and companies which have head offices in Shinjuku.
Property overview• The Property has eight floors above ground and one below with a gross floor area of 5,400.7 m2
and a leasable area of approximately 167 tsubo per floor is secured. It is equipped with 2,600 mmof typical floor celling height, 70 mm of OA floor, individual air-conditioning system, etc. The officehas no pillars within the rental space, which enables to offer excellent layout flexibility and usability.
• Even after surpassing 25 years since its completion, the property has been appropriately
maintained and managed, and will stay competitive from here on out without lagging behindproperties in the surrounding area through systematic facility renewal after the acquisition.

(Note 1) As of December 1, 2018

Location/Distance from Station

Sasazuka Shibuya-ku, Tokyo
7 minute

Appraisal Value (Note 1)

Construction Date
/Building Age

December 9, 1991
26.9 years*

Structure/Floor

SRC/S / B1/8F(Compartmentalized
ownership 100%)

5,400.70 m²

Occupancy Rate

100.0% (as of acquisition)

Number of Tenant

9 (as of acquisition)

Land Area(Ownership)(Note 2) Figures calculated by dividing the expected annual balanceof payments under the assumed occupancy rate (100.0%)
by the acquisition price, based on the lease agreement
upon acquisition, etc. while taking into account the accrualof tax and public due, etc. are indicated. The figures do not
represent forecast figures for the current period or the next
period onward.

3,300 million yen

1,001.88 m²

Building Area

NOI Yield

Occupancy Rate

Upon Acquisition (Note 2)(Note 3) Figures calculated by dividing the estimated figures fornormal operation period (with assumed occupancy rate of
95.0%) after acquisition, obtained by deducting rent
business-related expenses from rent revenue assumed
under rents over a medium term, by the acquisition priceare indicated. The figures do not represent forecast figures
for the current period or the next period onward.

NOI Yield

Occupancy Rate

5.0%

95.0%

Mid-term (Note 3)
4.2%

100.0%NOI Yield

Occupancy Rate
Depreciation (Note 4)

Appraisal
4.9%(Note 4) Depreciation indicates a figure obtained by dividing thetotal amount of depreciation (6 month equivalent) expected
to be posted upon property acquisition and depreciation(for 6 months) expected to be posted in the following fiscal
period by the acquisition price. The figures do not
represent forecast figures for the current period or the next
period onward.
* As of the end of November 2018

0.6%

96.0%

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

26

Changes in Asset Size and Trading Performance
Aim to Achieve Medium-Term Goal Asset Size of 500 Billion Yen

500.0
467.7

469.3 469.3

459.7

458.3

445.7

462.7

439.4

413.2
387.5
364.0
352.7

332.0
311.3

313.2

314.9

44.3%

43.0%
287.3
269.1

40.6%

278.1

40.2%

41.7%

43.3%

42.3% 42.2% 42.3%

41.9%
40.5% 41.5%

37.5%
34.4%
34.0% 34.2%

Acquisition Property• Daiwa River Gate
• Daiwa Hatchobori ekimae• Daiwa Hatchobori ekimae West

Acquisition Property

28.9%• Daiwa Shibuya Dogenzaka• Daiwa Akasaka• Daiwa Shibuya Miyamasuzaka

28.1%
25.5%
Acquisition Property

Acquisition Property• E SPACE TOWER
Acquisition Property• Daiwa Kayabacho• Daiwa Jinbocho 3-chome• Daiwa Ebisu 4-chome• LAQUAS Higashi Shinjuku• Daiwa Aoyama• Shinsen Place• Glass City Shibuya• Daiwa Meguro Square

Acquisition Property• shinyon curumu• Daiwa Meieki• Daiwa Kamiooka

Acquisition Property• Daiwa Nishi-Shimbashi• Daiwa Kudan

Acquisition Property• CONCURRED Yokohama• Daiwa Kanda East

Acquisition Property• Daiwa Osaki 3-chome

Acquisition Property

Acquisition Property• Daiwa Kanda Mikuracho
Acquisition Property• Daiwa Higashi-Nihonbashi• Square Daikanyama Building• Shinjuku West Building• Daiwa Ogikubo

Acquisition Property• Prime Kanda Building• Kita-Shinagawa Gotenyama Building• Sasazuka NA Building

Acquisition Property• Daiwa Azabu Terrace• Daiwa Kitahama• Sasazuka South Building
Acquisition Property

Acquisition Property• Daiwa Jimbocho

Acquisition Property• Daiwa Nihonbashi Hongokucho

Acquisition Property• Integral Tower• Daiwa Nishi-Shinjuku• Kirin Nihonbashi BuildingThis document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

27Section 4
Efforts on ESG

Concepts of Efforts on ESG
Aim for stable and sustainable growth through enforcing efforts on ESG (Environment, Social and Governance).

EnvironmentEstablishment of environmental policies and holding ofsustainable committee

Monitor environmental performance of its portfolio
properties, improvement of environmental performanceand obtainment of evaluation from external parties

Improve environment of surroundings and promoting
installation of LED lighting through green leasing

Build more desirable relationship with various
stakeholders including tenants, employees, unitholders
and lendersCommunication with local communitiesTransparency in management

Strictly disciplined investment policies

Highly-professional dedicated human resources

SocialGovernance

Sustainability
Realize sustainable growth thatis stable over a super long-term

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

29

Efforts on ESG | Environment (1)Establishment of Environmental Policies
THE INVESTMENT CORPORATION established environmental policies that compile policies on environmental efforts in January 2012
Environmental Policies

Implementation of Resource andEnergy Saving

Implementation of Environmental
Conservation

Daiwa Office Investment Corporation will proactively promote efficient use of resources and energy, and contribute torealizing a low-carbon society through such measures as employing technologies and systems designed to saveresources and energy.
Daiwa Office Investment Corporation will work to contribute to realizing a recycling oriented society through efforts forsaving water, reducing waste generation, re-using and recycling as it continuously conducts corporate activities.

Daiwa Office Investment Corporation will also work to promote green procurement, greening office buildings andimproving the office environment, among other efforts, to address biological diversity and achieve environmental
symbiosis.

Promotion of Environmental
Disclosure/Communication

Daiwa Office Investment Corporation will work to proactively disclose environment-related information, as well as aim
to broadly communicate with society, and to coordinate and cooperate with tenants, communities, business partners
and other stakeholders.

Establishment and Operation ofEnvironmental Management System

Daiwa Office Investment Corporation will establish an environmental management system and work to continuously
enhance its environmental activities. Daiwa Office Investment Corporation will also work to further improve theawareness of officers and employees in environmental preservation by conducting environmental education andenlightenment activities.

Adherence to Environment-Related
Laws and Regulations

Daiwa Office Investment Corporation will adhere to its internal environmental policies and guidelines as well as toenvironment-related laws and regulations, in an effort to preserve the environment.

Establishment of Sustainable Committee
The Investment Corporation’s Asset Management Company has been holding “sustainable committee” meetings that discuss various sustainability-related
topics since June 2014
Members:

Representative Director (chairman), Chief Division Officers, Deputy Chief Division Officers and General Managers of respective department

Secretariat:

Asset Management Department and Customer Relations Department

Detail:Consider and devise individual policy, goals and various measures related to sustainability

Frequency:

Hold twice or more per year
This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

30

Efforts on ESG | Environment (2)Environmental Certification
GRESB Real Estate Assessment
The Investment Corporation participates in the GRESB Real Estate Assessment since 2011 and earned the best
rating of Green Star for seventh consecutive year from 2012.

DBJ Green Building Certification

CASBEE Property Appraisal

Shinjuku Maynds Tower was evaluatedfor improving its building habitability byintroducing various environmental andenergy conserving technologies whileproviding a lot of restaurants, clinic andother facilities that facilitate convenience
for tenants.

<Shinjuku Maynds Tower><Glass City Shibuya>

BELS Evaluation<Shinjuku Maynds Tower>

Certification Based on SMBC Sustainable Building Assessment Loan

Daiwa Jimbocho, Daiwa Kayabacho Building and shinyon curumu have
newly acquired a Building Energy-efficiency Labeling System(BELS)
evaluation of ★★★, ★★ and ★ respectively as of March 3, 2016
<Daiwa Jimbocho>

Glass City Shibuya and Shinjuku Maynds Tower were awarded "A rank" in
CASBEE for Market Promotion certification system.

<Daiwa Kayabacho Build.><shinyon curumu>

Daiwa Ginza earned "Gold" because of a high evaluation for factors
including "the policy and implementation of sustainable management", "thesustainable utilization of site" and "the risk management", even thoughDaiwa Ginza is just coming up to 50 years old.
E SPACE TOWER earned<Daiwa Ginza><E SPACE TOWER>"Silver" because of a highevaluation for "the policy andimplementation ofsustainable management", "the sustainable utilization ofsite ", "indoor environment"and "water-saving".

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

31

Efforts on ESG | Environment (3)Efforts for improving the environment surrounding the building
Daiwa River Gate

• Installation of Solar Wind Street Light
Improved illuminance by installing solar wind street lights
which utilize strong winds and sufficient sunlight of thelocation near a river, which also leads to natural renewableenergy usage.

<Before><After>Directly under thelighting: 1 lux

Directly under thelighting: 200 lux

Stairs: 1 lux

Stairs: 10 lux

Contribute to the improvement in theenvironment surrounding thebuilding including crime prevention.
Moreover, illuminance was improvedat the stairs to clearly identify thedifferences in level.

Promoting installation of LED lighting through green leasing
Shinjuku Maynds Tower

Ratio of Areas with LED Lighting Installed[Period]
Since November 2014

[Details]
 As part of measures to protect the environment and raise tenantsatisfaction, the Investment Corporation has taken initiatives inwhich it concludes a green leasing agreement with tenants andpromotes installing LED lighting in areas exclusively occupiedby the tenants at Shinjuku Maynds Tower.
 Around 85% of areas exclusively occupied by tenants is
expected to have LED lighting in the fiscal period ending
November 2019.
* Ratios for 27th and 28th FPs are forecasted figures

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

32

Efforts on ESG | Social
Efforts for Enhancing Tenant Satisfaction
Customer Satisfaction Survey

Giving Out Novelty Goods[Target properties][Period][Target properties]

All properties

August 2018 to September 2018

Entrance floor, the first floor of Shinjuku Maynds Tower[Details][Period] Conducted questionnaire survey concerning cleaning of common-use
areas, cleaning of office areas, elevators, toilets/powder rooms, etc.
targeting people in charge of general affairs and office workers of its
tenants. The aim is to enhance tenant satisfaction by identifying
issues and making improvements.

Around December of each year

[Details]
 Give out annual Shinjuku Maynds Tower desk calendar. Aim is to improve sense of affinity among office
workers of its tenants toward Shinjuku Maynds Tower.

Coexistence with Local Communities
Shinjuku Minami Lumi

[Target properties][Period]

Shinjuku Maynds Tower

Annually early November to mid-February of next year

[Details]
 Held “Shinjuku Minami Lumi,” an event to illuminate Shinjuku South Exit area, jointly with Odakyu Electric
Railway, Takashimaya, East Japan Railway and Asahi Mutual Life Insurance for six consecutive years
since 2013.
 With dreamy illuminations, the event provides space that creates venue for office workers in the nearby companies and stores, visitors and local residents to communicate with each otherwhile improving awareness of the Shinjuku South Exit area.

Efforts for Employees
Improving Work Environment

Fostering of Human Resources[Target properties][Target]Daiwa Ginza

Asset Management Company[Period][Details]

Since October 2018

 Asset Management Company of the Investment Corporation introduced
system to subsidize expenses required to obtain qualifications, targetinga wide range from those related to real estate including real estateappraiser, ARES Certified Master and real estate notary to Securities
Analyst and language-related qualifications.

[Details]
 Substantially expanded open space and secured community space for
employees to relax or have meetings. The aim is to enable fruitfulcommunications among employees.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

33

Efforts on ESG | Governance (1)Corporate GovernanceCompliance System

The Asset Management Company of the Investment Corporation
strives to prevent conflict of interest, manage risks and comply withlaws and regulations by establishing a governance system placing thehighest priority on compliance.

Strictly complying with various laws and regulations, rules and internal
rules related to business as well as focusing on sincere and faircorporate activities based sufficiently on social norms

Decision-Making Flow in Transactions with Related Parties

The decision-making procedures fromthe creation and submission of the billconcerning investment management toresolution is as follows.
Those having a special interest
regarding the resolution at theInvestment Committee, Compliance
Committee and Board of Directors
cannot exercise the voting rights for thesaid resolution.
(Unanimous approval by members who
can exercise the voting rights isrequired)

Related Departments
Board of Directors

Examination/
Approval Determined the basic
items concerningcompliance

Compliance Officer

Compliance Officer
Deliberation/
Resolution

Deliberation/
Resolution

Deliberation/
Resolution or
ReportApproval or
ReportCompliance Committee

Internal Control Office

Investment CommitteeRole

It established the Investment
Committee and Compliance Committee
as a system to prevent conflict ofinterest transactions and conducts
appropriate management. In addition,
approval of the Executive Committee isrequired in related party transactions.

Drafting

Compliance Committee

Board of Directors

Characteristics

The Asset Management Company will
select investment target assets anddecide the acquisition of such assets incompliance with the investment policy
and rules on conflict of interest definedin the management guideline.

Departments Responsible for Compliance System

 Planning, proposal andpromotion ofcompliance Unified management ofcompliance issues

 Maintained andmanaged information byalso serving as
information security
control manager

 Deliberation andresolution of items
concerning compliance Deliberation bymembers including two
external committee
members familiar withcompliance Resolution requiring
unanimous approval Implementation ofinternal inspection
 Securement of internal
control environment

 Securement ofcompletely independentinternal management
systemExecutive Committee

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

34

Efforts on ESG | Governance (2)Number of Qualification Holders at Asset Management Company
The Asset Management Company of the Investment Corporation
recommends the acquisition of various qualifications for the improvementof expertise as well as supports training and exams for the acquisition of awide range of knowledge and skills necessary for business in order to train
employees with high expertise.

Qualification

Number ofqualification holders(people)Real Estate Notary

64

ARES Certified Master

32

Real Estate Consulting Technician

7

First Class Architect

6

Real Estate Appraiser

2

Certified Building Administrator

4

Securities Analyst

7

Tax Accountant

2

Inclusion in MSCI Japan ESG Select Leaders Index
The Investment Corporation was included in “MSCI Japan ESG SelectLeaders Index” provided by MSCI on July 3, 2017 as its efforts on ESG
were evaluated.

MSCI Japan ESG Select Leaders Index“MSCI Japan ESG Select Leaders Index” is a new index
provided by MSCI listed on the New York Stock
Exchange. The index is designed to target companies in
the MSCI Japan IMI Top 700 Index that have high“Environmental”, “Social” and “Governance” (ESG)
profile relative to their sector peers.
It has been selected by the Government Pension
Investment Fund (GPIF) as one of ESG indices used
upon conducting passive management.

* 114 executives as of December 1, 2018

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

35

Efforts on ESG | Sustainable Development Goals (SDGs)
The Asset Management Company of the Investment Corporation is making efforts to realize the philosophy of“Sustainable Development Goals (SDGs)” based on “Passion for SDGs 2018~ Daiwa Securities Group’s SDGs
Declaration~” announced by Daiwa Securities Group Inc., the sponsor group.
Sustainable Development Goals (SDGs)
SDGs are international goals unanimously adopted at the UN Summit in September 2015.
It is composed of “17 goals, 169 targets and 232 indicators” effective until 2023 pledging
that no one will be left behind to realize a society with diversity and inclusivity insustainable development.
Following are the five characteristics
Universality

All countries including developed countries shall act

Inclusivity

Ensuring that no one will be left behind by reflecting the philosophy of security

Participatory

All stakeholders shall play their roles

Integrity

Making integrated efforts on the society, economy and environment

Transparency

Conducting regular follow-up
Source: Website of Ministry of Foreign Affairs

Passion for SDGs 2018―Daiwa Securities Group’s SDGs Declaration―
Daiwa Securities Group Inc. regards “SDGs (Sustainable Development Goals)” (*) adopted by the UN in 2015 as an important goal leading the world, and ismaking proactive efforts to realize an affluent society and enriched lives of citizens by achieving both the pursuit of economic value and the resolution ofsocial issues through the Group’s business.
 Creation of shared value Realization of various personnel training and work styleCreating both economic value and social value of corporations at the same time by making efforts tosolve social issues with flexible ideas without being bounded by preconceived ideas as acomprehensive securities group providing a wide range of services satisfying the needs from various
customers.

 Partnership with stakeholders

Making efforts to realize various personnel training and work style by promoting work-life balanceand supporting the success of female and veteran employees as well as creating an environment
where all employees regardless of gender and age are satisfied and able to maximally demonstrate
their skills.

 Improvement and spread of awareness

Aiming to contribute to the resolution of a wide range of social issues through the partnership witheach stakeholder by utilizing the characteristics of the Group which connects countries, companies,
investors, etc.

Intending to provide and spread an understanding on SDGs to all executives as well as contributing
to the improvement of the awareness on SDGs of customers through the Group’s business as theleader in the financial and capital market.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

36

MEMO

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

37Section 5
Financial Strategy

Status of Interest-bearing Liabilities (1)Loan to Value Trend

Status of Interest-bearing Liabilities(End of 26th Fiscal Period)(Billion Yen)

Ratio of
Fixed and Floating Borrowings

Ratio ofLong and Short-Term Borrowings

10.6%

29.4%

Medium- to long-term,
upper-limit target LTV range
41.5%

70.6%

89.4%

Fixed interest

Long-term loans payable, etc.

Floating interest

Current portion of long-termloans payable and current
portion of investment
corporation bonds

Status of Rating
Japan Credit Rating Agency, Ltd. (JCR)

Long-term issuer rating
Rating outlook: Positive(As of March 5, 2018)

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

Issuer rating
Rating outlook: Positive(Note) LTV (based on total assets) = Total interest-bearing liabilities / Total assets(As of September 12, 2018)

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

39

Status of Interest-bearing Liabilities (2)Repayment Schedule(Million Yen)

Changes in Procured Years of Interest-Bearing Liabilities(Year)(Year)

 Investment Corporation Bond

4.2

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

8.5
8.5

40

Status of Interest-bearing Liabilities (3)As of End of the 26th Fiscal Period(Million Yen)
Nam e of Financial Institutions

BalanceComparison with
Previous Period

Balance Ratio

Nam e of Financial Institutions

Comparison with
Previous Period

Balance

Balance Ratio

Sum itom o Mitsui Banking
Corporation

39,400+3,000

20.3%

The Yam aguchi Bank, Ltd.

2,000

0

1.0%

Sum itom o Mitsui Trust Bank,Lim ited

23,500+1,00012.1%

ORIX Bank Corporation

1,500

0

0.8%

Developm ent Bank of Japan Inc.

21,7500

11.2%

Nippon Life Insurance
Com pany

1,300

0

0.7%

MUFG Bank, Ltd.

21,500+1,000

11.1%

The Kagaw a Bank, Ltd.

1,000

0

0.5%

Mizuho Corporate Bank, Ltd.

19,400+1,000

10.0%

The Higashi-Nippon Bank,Lim ited

1,000

0

0.5%

Shinsei Bank, Lim ited

14,0000

7.2%

Taiyo Life Insurance Com pany

300

0

0.2%

Resona Bank, Lim ited

12,500

0

6.4%

Fukoku Mutual Life Insurance
Com pany

200

0

0.1%

Mizuho Trust and Banking Co.,
Ltd.

9,500

+4,000

4.9%

Total (23 banks)

193,850+10,000

100.0%The Bank of Fukuoka, Ltd.

5,500

0

2.8%

Kansai Urban Banking
Corporation

5,000

0

2.6%

Aozora Bank, Ltd.

3,000

0

1.5%

Nishi-Nippon City Bank, Ltd.

3,000

0

1.5%

The Gunm a Bank, Ltd.

2,500

0

1.3%

The 77 Bank, Ltd.

2,000

0

1.0%

No. 3 Unsecured Investm ent
Corporation Bond

3,000

0

5 years

The Musashino Bank, Ltd.

2,000

0

1.0%

No. 4 Unsecured Investm ent
Corporation Bond

2,100

0

10 years

Tokio Marine & Nichido Fire
Insurance Co., Ltd.

2,000

0

1.0%

Total
Investm ent Corporation Bonds

5,100

0

-

Issuance

BalanceComparison with
Previous Period

Duration of
Liabilities

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

41

Unitholders as of the end of the November 2018 (26th) Fiscal Period
Unitholders’ Share by Investor Type

Investor Type

Number of
Units
End of 25th
Fiscal Period

Number of
Units
End of 26th
Fiscal Period

List of Top 10 Investors
Rate (Note)
End of 26th
Fiscal Period

Change of
Units

Individuals

17,144

15,507-1,637

3.15%

Financial
Institutions

171,532

170,277-1,25534.62%

0

0

0

0.00%

14,312

13,482

-830

2.74%

Commercial
Bank

Regional Bank

No.

Investor Nam e

146,875

145,874-1,001

026.21%

2 (Investment Trust Account)

65,12565,790+665

13.38%

3 Daiwa Securities Group Inc.

59,321

59,3210

12.06%

39,50640,651+1,145

8.26%

26,04520,941-5,1044.26%

12,606

13,444

+838

2.73%

0

9,017

+9,017

1.83%

4,509

6,061

+1,552

1.23%

8,006

5,413

-2,593

1.10%

4,368

4,353

-15

0.88%

348,391

353,896+5,50571.95%The Master Trust Bank of Japan, Ltd.

Japan Trustee Services Bank, Ltd.

29.66%
Trust & Custody Services Bank, Ltd.

810

1,690

+880

0.34%
The Nomura Trust and Banking Co., Ltd.

Non-life
Insurance

6 (Investment Trust Account)

422

444

+22

0.09%

Other Financial
Institutions

9,113

8,787

-326

1.79%

Other Dom estic
Corporation

190,961

191,021+60

38.84%

Foreigner

106,453

109,735+3,28222.31%

9 COMPANY 505012

Securities

5,787

5,337

-450

1.09%

10 TREATY 505234

Total

491,877

491,8770100.00%7 BNYM AS AGT/CLTS 10 PERCENT

8 SSBTC CLIENT OMNIBUS ACCOUNTSTATE STREET BANK AND TRUST(Note) Rounded to the second decimal place

Rate (Note)
End of 26th
Fiscal Period

Change ofUnits

128,905

5 (Securities Investment Trust Account)
Life Insurance

Number of
Units
End of 26th
Fiscal Period

128,905

1 Daiwa Investment Management Inc.

4 (Trust Account)
Trust Bank

Number of
Units
End of 25th
Fiscal Period

STATE STREET BANK WEST CLIENT -Total(Note) Rounded to the second decimal place

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

42

Future Initiatives

Internal GrowthConnecting to internal growth through a thorough handson approach based on focusing the portfolio on the steadyTokyo office market.

Continue to carefully select and actively invest in competitive
properties including strategic asset replacement that
contributes to enhancement of portfolio value.



Work to further strengthen financial structure against the
backdrop of a favorable financial market.
Conduct agile and flexible fund procurement by capitalizing
on strong relationships with lenders.
Strengthen IR, aiming for increase in number of investors.

“Bonji-Tettei”

External Growth

Acquisition of carefully
selected properties

Financial Strategy

Continue to strengthen
financial structureCorporate Governance
As a REIT on which strict governance is expected, further reinforce readiness concerning internal control,

legal compliance and risk management in order to further assure the trust of unitholders.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

43

Appendix

Three Characteristics of the Investment Corporation(As of January 22, 2019)

OfficeBuilding

Office Specialized REIT

100％

Regional Major Cities
2.0％

Greater Tokyo
17.2％

REIT focused on
the Five Central Wards ofTokyo

Five Central Wardsof Tokyo
80.8％(Note) Based on acquisition price.

Fiscal period
ended May 2018
(25th FP)

Steady Growth in Distribution
Dividend
per Unit

Fiscal period
Fiscal period
Fiscal period
ended Nov. 2018 ending May 2019 ending Nov. 2019
(26th FP)
(27th FP)
(28th FP)

ActualActualForecast

Forecast

11,150 yen

11,997 yen

12,300 yen

12,400 yen

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

45

Summary of Results for the Fiscal Period ended November 2018 (26th FP) (1)― Balance Sheet ―Comparison with Results of the 25th Fiscal Period

Cash and Deposits in Trust
Other Current Assets
Fixed Assets
Tangible Fixed Assets
Building and Others(including Trust Property )Land and Others(including Trust Property )AssetsOther Tangible Fixed Assets
Intangible Fixed Assets
Leasehold Rights and Leasehold
Rights in Trust
Other Intangible Fixed Assets
Inv estments and Other Assets

25th Fiscal Period

26th Fiscal Period

Million Yen

Million Yen

Million Yen

Million Yen

32,648(%)

7.0

28,687

24,203

3,383

4,301

577

892

Operating Accounts Pay ables
Current portion of inv estment
corporation bonds
Current Portion of Long-term Loans
Pay able

19,802

4.2

872

1,255

-

3,000

15,50018,000534

583

454,99494.9

Accounts Pay ables-Other

430,49792.2

451,179

94.2

Adv ances Receiv ed

2,073

2,177

Other Current Liabilities

821

779

82,19585,199347,477

365,554

824

425

2,730

0.6

2,728

2,705

2,705

25

23

1,145

0.2

1,085

Long-term Prepaid Expenses

903

884

Other Inv estments and Other
Assets

128

87

17

0.0

17
467,040

14

Inv estment Corporation Bonds

0.6

479,212Long-term Loans Pay able
Tenant Leasehold and Security
Deposits
Tenant Leasehold and Security
Deposits in Trust

0.2

Other Fixed Liabilities
Total Liabilities
Unitholders’ equity (net amount)

0.0

14
100.0

Fixed Liabilities

100.0

193,561

41.4

2,100

168,350

175,850

17,70918,145

1,792

2,647

609

549
45.7

247,876

251,551

251,551-3,675-3,675

Unappropriated Retained Earnings

6,051

6,468

Valuation, Translation Adjustments andOthers-251-220

Deduction f rom unitholders’ capital

Total Net Assets
Total Liabilities and Net Assets

41.6

225,088247,876

Unitholders' capital

5.4

199,291

5,100

213,363(%)

25,796

93.0

113

Total Assets

Current Liabilities(%)

434,373

113

Inv estment Corporation Bond
Issuance Costs

5.1

19,008

Leasehold and Security Deposits
Paid in Trust

Def erred Assets(%)

Liabilities

Cash and Deposits

26th Fiscal Period

Net Assets

Current Assets

25th Fiscal Period

47.0

253,67654.3

254,12453.0

467,040100.0

479,212100.0This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

46

Summary of Results for the Fiscal Period ended November 2018 (26th FP) (2)― Income Statement ―Comparison with Results of the 25th Fiscal Period

Comparison with the 26th Fiscal Period Forecasts(Million Yen)

Effective Number of Days of Investment

25th Fiscal
Period26th Fiscal
Period182 days

183 days

ChangeEffective Number of Days of Investment

13,44013,193

-246

481

-

-481

6,761

6,658

-103

Expenses related to Rental Business(excluding depreciation)

3,638

3,610

-27

Depreciation

1,772

1,734

-37

Operating Rev enues (A)Gain on sales of real estate properties
Operating Expenses (B)(Million Yen)
26th Fiscal Period
Forecast(Announced
July 18, 2018)

26th Fiscal
Period183 days

183 days

Change13,02913,193

+163

-

-

-

6,570

6,658

+87

Expenses related to Rental Business(excluding depreciation)

3,552

3,610

+58

Depreciation

Operating Rev enues (A)Gain on sales of real estate properties
Operating Expenses (B)

1,708

1,734

+25

+348

Gain and Loss f rom Rental Operations(excluding gain on sales of real estate properties)

7,769

7,848

+79

6,535

-143

Operating Income (A-B)

6,459

6,535

+76

929

636

-293

Non-operating Expenses

628

636

+7

558

498

-60

492

498

+6

5,888

5,902

+14

5,830

5,902

+71

Extraordinary Income

-

-

-

Extraordinary Income

-

-

-

Extraordinary Expenses

-

-

-

Extraordinary Expenses

-

-

-

Total Income Taxes(Includes income taxes def erred)

0

0

+0

Total Income Taxes(Includes income taxes def erred)

2

0

-1

5,887

5,901

+13

5,828

5,901

+72

491,877 units 491,877 units-

Inv estment Units Issued and Outstanding

491,877 units 491,877 units-

Div idend per Unit

+ 11,850 yen

Gain and Loss f rom Rental Operations(excluding gain on sales of real estate properties)

7,499

7,848

Operating Income (A-B)

6,678

Non-operating Expenses
Interest Expense(including cap amortization)
Ordinary Income

Net Income
Inv estment Units Issued and Outstanding
Div idend per Unit

11,150 yen

11,997 yen+ 847 yenInterest Expense(including cap amortization)
Ordinary Income

Net Income+ 11,997 yen+ 147 yen

(Note) Dividends per unit for the 25th FP is calculated by dividing the amount obtained by subtracting provision for reserve for reduction entry (403 million yen) from unappropriated retained earnings by the total number of investment units issued andoutstanding.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

47

Forecasts for the Fiscal Periods ending May 2019 and November 2019(27th and 28th FP)
Forecasts for the 27th and 28th Fiscal Periods(Million Yen)

Effective Number of Days of Investment

26th Period(Nov. 30, 2018)

27th Period
Forecast(May 31, 2019)28th Period
Forecast(Nov. 30, 2019)

183 days

182 days

183 days

13,193

13,67913,550

-

143

-

6,658

6,820

6,776

Expenses related to Rental Business(excluding depreciation)

3,610

3,653

3,637

Depreciation

1,734

1,791

1,787

Gain and Loss f rom Rental Operations(excluding gain on sales of real estate properties)

7,848

8,090

8,125

Operating Income (A-B)

6,535

6,858

6,774

Non-operating Expenses

636

663

672

498

511

510

5,902

6,195

6,101

Extraordinary Income

-

-

-

Extraordinary Expenses

-

-

-

Total Income Taxes(Includes income taxes def erred)

0

2

2

5,901

6,193

6,099

491,877 units

491,877 units

491,877 units

11,997 yen

12,300 yen

12,400 yen

Operating Rev enues (A)Gain on sales of real estate properties
Operating Expenses (B)Interest Expense(including cap amortization)
Ordinary Income

Net Income
Inv estment Units Issued and Outstanding
Div idend per Unit (Note)(Note) Dividends per unit for the 27th FP is calculated by dividing the amount obtained by subtracting provision for reserve for reduction entry (143 million yen) from unappropriated retained
earnings by the total number of investment units issued and outstanding.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

48

Major Financial Data

Item

Number of days of investment

Number of properties at end of period

Occupancy rate at end of period

Unit

22nd
Period23rd
Period24th
Period25th
PeriodNOI

26th
Period

Day

183

182

183

182

183

Property

53

54

54

55

58

%

97.7

97.7

98.2

99.0

98.9

Average acquisition priceMillion Yen

466,891

469,166

469,341

463,157

445,053

NOI (after deduction of gain on sale)

Million Yen

9,067

9,166

9,224

9,271

9,583

Funds from operation (FFO)

Million Yen

6,972

7,129

7,223

7,177

7,635

%

2.2

2.2

2.3

2.5

2.5

Rent revenue + Other operating revenue –Expenses
related to rent business + Depreciation
FFO
Net income + Depreciation – Gain on sale

ROA
Annualized ordinary income /Return on asset (ROA)(total assets at beginning of fiscal period+ total assets
at end of fiscal period) / 2

ROE
Annualized net income /Return on equity (ROE)

%

4.2

4.2

4.2

4.6

4.6

Capital adequacy ratio at end of period

%

53.1

53.0

53.1

54.3

53.0

Loan-to-Value (LTV) at end of period

%

42.3

42.2

42.3

40.5

41.5

(net assets at beginning of fiscal period+ net assets at
end of fiscal period) / 2

Loan-to-Value (LTV) at end of fiscal period
Interest-bearing liabilities at end of fiscal period / Total
assets at end of fiscal period

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

49

Status of Interest-bearing Liabilities (as of November 30, 2018) (1)Borrowings
Lender
The Kagawa Bank, Ltd. (*)
Aozora Bank, Ltd. (*)
Sumitomo Mitsui Trust Bank, Limited (*)

Development Bank of Japan Inc.
Kansai Urban Banking Corporation (*) (**)
Sumitomo Mitsui Trust Bank, Limited (*)

ORIX Bank Corporation
The Bank of Fukuoka, Ltd. (*)
Resona Bank, Limited (*)
MUFG Bank, Ltd. (*)
The Gunma Bank, Ltd. (*)
The Musashino Bank, Ltd.(*) (**)
MUFG Bank, Ltd.

Total current maturities of long-term borrowings
Sumitomo Mitsui Trust Bank, Limited (*)

Aozora Bank, Ltd. (*)
Resona Bank, Limited (*)
Kansai Urban Banking Corporation (*) (**)
Sumitomo Mitsui Banking Corporation (*)

Shinsei Bank, Limited (*) (**)
The Higashi-Nippon Bank, Limited (*)

Long-term borrowings

Sumitomo Mitsui Trust Bank, Limited (*)

Shinsei Bank, Limited (*) (**)
Shinsei Bank, Limited (*) (**)
MUFG Bank, Ltd. (*)
Sumitomo Mitsui Trust Bank, Limited (*)
Sumitomo Mitsui Banking Corporation (*)

Mizuho Bank, Ltd. (*)
Sumitomo Mitsui Banking Corporation (*)

Shinsei Bank, Limited (*) (**)
Resona Bank, Limited (*)
Sumitomo Mitsui Banking Corporation (*)
Sumitomo Mitsui Banking Corporation (*)

Mizuho Bank, Ltd. (*)
MUFG Bank, Ltd. (*)
Development Bank of Japan Inc.
MUFG Bank, Ltd. (*)
Mizuho Bank, Ltd. (*)
MUFG Bank, Ltd. (*)
Sumitomo Mitsui Banking Corporation (*)

MUFG Bank, Ltd. (*)
Mizuho Trust and Banking Co., Ltd. (*)
Sumitomo Mitsui Banking Corporation (*)
Sumitomo Mitsui Banking Corporation (*)
Sumitomo Mitsui Banking Corporation (*)

Balance(million yen)Interest
Type

Interest Rate(%)

Date of
AdvanceDue date

1,000
1,000
1,500
1,000
1,500
1,000
1,500
2,000
2,000
3,000
1,000
500
1,000
18,000
1,500
2,000
2,000
2,000
1,600
1,000
1,000
4,000
1,000
1,000
3,000
1,000
1,400
4,000
1,400
1,000
2,000
1,000
1,000
3,900
2,000
1,000
1,000
1,500
1,000
3,000
1,000
3,000
2,000
3,500
4,000

Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed

0.814%
0.878%
0.844%
0.963%
0.677%
0.824%
0.687%
0.662%
0.571%
0.500%
0.500%
0.435%
0.300%

13/2/28
13/4/12
13/4/12
13/4/12
13/6/28
13/7/813/9/30
13/9/30
14/3/18
14/3/31
14/3/31
14/5/29
15/9/11

19/2/28
19/5/31
19/11/29
19/11/29
19/8/30
19/11/29
19/2/28
19/3/29
19/9/30
19/3/29
19/3/29
19/5/31
19/8/30

Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed

0.896%
0.896%
0.896%
0.794%
0.781%
0.787%
0.808%
0.816%
0.836%
0.856%
0.761%
0.646%
0.629%
0.636%
0.636%
0.737%
0.606%
0.606%
0.593%
0.606%
0.595%
0.742%
0.618%
0.585%
0.585%
0.378%
0.378%
0.530%
0.530%
0.618%
0.585%

13/2/1
13/2/28
13/3/1
13/6/28
13/7/3
13/7/3
13/7/3
13/7/8
13/7/31
13/7/31
13/8/913/8/913/8/913/9/27
13/9/27
13/11/29
14/3/18
14/3/25
14/3/25
14/3/31
14/5/29
14/5/29
14/5/29
14/5/29
14/5/29
14/5/29
14/5/29
14/7/8
14/7/8
14/7/8
14/7/8

20/2/28
20/2/28
20/2/28
20/8/31
20/8/31
20/11/30
20/11/30
20/5/29
21/5/31
21/8/31
20/8/31
21/2/26
21/5/31
21/3/31
21/3/31
20/11/30
21/3/31
21/3/31
22/2/28
21/3/31
20/5/29
20/11/30
21/11/30
22/5/31
22/5/31
22/11/30
22/11/30
20/11/30
20/11/30
21/11/30
22/5/31

Term

Lender
Shinsei Bank, Limited
Sumitomo Mitsui Banking Corporation (*)

MUFG Bank, Ltd. (*)
Mizuho Bank, Ltd. (*)
Sumitomo Mitsui Banking Corporation (*)

Shinsei Bank, Limited
Development Bank of Japan Inc.
MUFG Bank, Ltd. (*)
MUFG Bank, Ltd. (*)
Mizuho Bank, Ltd. (*)
Resona Bank, Limited (*)
Sumitomo Mitsui Trust Bank, Limited (*)
Sumitomo Mitsui Banking Corporation (*)

Long-term borrowings

Current maturities of long-term borrowings

Term

Resona Bank, Limited (*)
Development Bank of Japan Inc.
Shinsei Bank, Limited
The 77 Bank, Ltd. (*)
Development Bank of Japan Inc.
The Bank of Fukuoka, Ltd. (*)
Sumitomo Mitsui Trust Bank, Limited (*)

Mizuho Bank, Ltd. (*)
Shinsei Bank, Limited
Resona Bank, Limited (*)
Sumitomo Mitsui Banking Corporation

Mizuho Bank, Ltd. (*)
MUFG Bank, Ltd. (*)
The Musashino Bank, Ltd. (*) (**)
Nishi-Nippon City Bank, Ltd.
The 77 Bank, Ltd. (*)
Sumitomo Mitsui Banking Corporation

Nippon Life Insurance Company (*)
Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.
Sumitomo Mitsui Banking Corporation

The Gunma Bank, Ltd. (*)
Nippon Life Insurance Company (*)
Taiyo Life Insurance Company
Sumitomo Mitsui Banking Corporation (*)

Development Bank of Japan Inc.
Mizuho Bank, Ltd. (*)
Resona Bank, Limited (*)
Mizuho Trust and Banking Co., Ltd. (*)

Shinsei Bank, Limited
Nishi-Nippon City Bank, Ltd.
MUFG Bank, Ltd.

Balance(million yen)Interest
Type

Interest Rate(%)

Date of
AdvanceDue date

1,000
2,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,500
1,500
1,000
1,500
2,500
2,000
1,500
1,000
1,500
1,500
1,500
1,500
1,500
1,500
3,000
2,000
500
1,000
2,000
1,000
500
1,000
1,000
1,000
1,000
1,000
300
300
1,500
1,500
1,000
1,000
1,000
1,000
1,000
2,500

Float
Fixed
Fixed
Fixed
Fixed
Float
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Float
Fixed
Fixed
Fixed
Fixed
Fixed
Float
Fixed
Float
Fixed
Fixed
Fixed
Float
Fixed
Float
Fixed
Float
Float
Float
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Fixed
Float
Float
Float

L+0.325%
0.378%
0.560%
0.353%
0.458%
L+0.350%
0.692%
0.593%
0.560%
0.353%
0.353%
0.353%
0.458%
0.365%
0.710%
L+0.325%
0.479%
0.634%
0.408%
0.450%
0.450%
L+0.325%0.450%
T+0.350%0.450%
0.450%
0.349%
L+0.250%
0.281%
T+0.350%
0.281%
T+0.325%
T+0.325%
T+0.350%0.443%
0.281%
0.541%
0.290%
0.303%
0.290%
0.391%
0.391%
T+0.300%
T+0.300%
T+0.325%

14/7/8
14/7/8
14/12/1
14/12/1
14/12/1
14/12/1
14/12/3
14/12/3
14/12/3
14/12/3
14/12/3
14/12/3
14/12/3
15/2/27
15/3/31
15/3/31
15/5/1
15/5/1
15/5/1
15/5/1
15/5/1
15/5/1
15/5/1
15/5/1
15/5/29
15/5/29
15/8/31
15/8/31
15/8/31
15/8/31
15/9/1115/9/1115/9/1115/9/11
15/11/30
15/11/30
15/11/30
16/3/29
16/3/29
16/3/29
16/3/29
16/3/29
16/3/29
16/3/29
16/3/29

22/8/31
22/11/30
22/5/31
22/11/30
23/5/31
23/5/31
21/11/30
21/11/30
22/5/31
22/11/30
22/11/30
22/11/30
23/5/31
23/2/28
22/3/31
23/5/31
21/5/31
22/5/31
23/5/31
23/11/30
23/11/30
23/11/30
23/11/30
24/5/31
23/11/30
23/11/30
20/8/31
22/8/31
22/8/31
24/8/30
22/8/31
24/2/29
24/2/29
24/8/30
22/2/28
22/8/31
22/11/30
23/2/28
23/2/28
23/2/28
23/8/31
23/8/31
24/2/29
24/2/29
24/8/30(Note) Fixed Interest Rate and Floating Interest Rate are rounded to the third decimal place.
** Interest rates that were changed from a floating rate to a fixed rate by concluding the swap agreement are described as fixed interest rates.
** Interest rates are converted based on 1 year = 365 days and indicated.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

50

Status of Interest-bearing Liabilities (as of November 30, 2018) (2)Investment Corporation Bonds
Term

Lender
MUFG Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation

Mizuho Bank, Ltd.
Shinsei Bank, Limited
Fukoku Mutual Life Insurance Company

The Yamaguchi Bank, Ltd.
Development Bank of Japan Inc.
Development Bank of Japan Inc.
Development Bank of Japan Inc.

Long-term borrowings

Sumitomo Mitsui Banking Corporation

Mizuho Trust and Banking Co., Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation

Development Bank of Japan Inc.
Sumitomo Mitsui Banking Corporation

Mizuho Bank, Ltd.
Tokio Marine & Nichido Fire Insurance Co., Ltd.

Development Bank of Japan Inc.
The Yamaguchi Bank, Ltd.
Shinsei Bank, Limited
Sumitomo Mitsui Trust Bank, Limited
The Gunma Bank, Ltd.
The Musashino Bank, Ltd.
Tokio Marine & Nichido Fire Insurance Co., Ltd.

Kansai Urban Banking Corporation
The Bank of Fukuoka, Ltd.
Development Bank of Japan Inc.
Sumitomo Mitsui Trust Bank, Limited
Mizuho Trust and Banking Co., Ltd.
Sumitomo Mitsui Banking Corporation

Balance(million yen)Interest
Type

Interest Rate(%)

Date of
AdvanceDue date

1,500
2,000
1,500
1,000
2,000
200
1,500
1,700
3,500
3,000
2,000
1,500
3,000
2,000
2,550
1,500
1,000
1,000
2,000
500
2,000
5,000
500
500
1,000
1,500
2,000
1,000
1,000
4,000
3,000
1,000
1,000
175,850
193,850

Float
Float
Float
Float
Float
Fixed
Fixed
Fixed
Fixed
Fixed
Float
Float
Float
Float
Fixed
Float
Float
Fixed
Fixed
Fixed
Float
Float
Float
Float
Fixed
Float
Float
Fixed
Float
Float
Float
Float
Float

T+0.325%
T+0.325%
T+0.350%
T+0.350%
T+0.325%
0.579%
0.450%
0.387%
0.437%
0.477%
T+0.300%
T+0.300%
T+0.325%
T+0.325%0.457%
T+0.350%
T+0.350%0.303%
0.498%
0.489%
T+0.325%
T+0.300%
T+0.225%
T+0.300%
0.313%
T+0.250%
T+0.350%
0.679%
T+0.300%
T+0.350%
T+0.350%
T+0.350%
T+0.350%

16/3/29
16/5/26
16/5/26
16/5/26
16/5/31
16/5/31
16/8/31
17/5/10
17/5/22
17/5/22
17/5/31
17/5/31
17/5/31
17/5/31
17/8/31
17/8/31
17/8/31
17/11/30
17/11/30
17/11/30
17/11/30
18/2/28
18/5/31
18/5/31
18/7/31
18/8/31
18/8/31
18/8/31
18/10/30
18/10/30
18/10/30
18/10/30
18/10/30

24/8/30
24/11/29
25/5/30
25/5/30
24/11/29
26/5/29
26/8/31
23/11/30
24/5/31
24/11/29
25/5/30
25/5/30
25/11/28
25/11/28
25/5/30
26/8/31
26/8/31
22/11/30
25/5/30
25/11/28
26/5/29
26/2/27
25/5/30
26/5/29
23/7/31
25/8/31
27/8/31
27/8/31
26/10/30
27/10/29
27/10/29
27/10/29
27/10/29

Term
Long-term

Lender
No. 3 Unsecured Investment Corporation Bond
No. 4 Unsecured Investment Corporation Bond

Total investment corporation bonds

Balance(million yen)Interest
Type

Interest Rate(%)

Date of
AdvanceDue date

3,000
2,100
5,100

Fixed
Fixed

0.420%
1.000%

14/9/12
14/9/12

19/9/12
24/9/12

MUFG Bank, Ltd.
Mizuho Bank, Ltd.
Total long-term borrowings
Total borrowings(Note) Fixed Interest Rate and Floating Interest Rate are rounded to the third decimal place.
** Interest rates that were changed from a floating rate to a fixed rate by concluding the swap agreement are described as fixed interest rates.
** Interest rates are converted based on 1 year = 365 days and indicated.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

51

Analyses of Tenants% Share of Industries (Note 1) of Top 100 Tenants (Note 2)

Major Tenants Top 10 List

Tenant Name

Property

Leased Area(m2)

% of Total
Leased Area
(Note 2)

Other
15.2%
Schools
2.3%
Insurance
4.1%

Not disclosed (Note 1)

Sasazuka NA Building

7,135.30

1.9%

Jupiter Shop Channel Co., Ltd.

Daiw a River Gate

6,211.30

1.7%

Precision
Instruments
4.4%

Tokio Marine & Nichido Anshin
Consulting Co., Ltd.

Integral Tow er

6,058.41

1.6%

Real Estate
4.9%

Palsystem Consum ers'
Co-operative UnionLAQUAS Higashi
Shinjuku

5,985.08

1.6%

Construction
6.0%

Not disclosed (Note 1)

Daiw a Kayabacho

5,899.11

1.6%

Electric Device
6.1%

Kirin Brew ery Com pany, Ltd.

Kirin Nihonbashi Building

5,630.17

1.5%

Foods
6.9

Not disclosed (Note 1)

Sasazuka NA Building

5,307.56

1.4%

Information &Communication
24.0%

Services
20.0%
Retail Trade
8.2%(As of November 30, 2018)(Note 1) The leased area of top 100 tenants covers 61.3% of total leased area as of the end of the 26th Fiscal Period

UCC Holdings Co., Ltd.

Daiw a Onarimon

5,049.92

1.4%

Not disclosed (Note 1)

Glass City Shibuya

4,659.25

1.3%

Mitsubishi UFJ NICOS Co., Ltd.

Daiw a Kitahama

4,515.35

1.2%

56,451.45

15.8%

Total

(Note 2) Industries are categorized according to TSE’s 33 industry groups.
(Note 3) The ratio is rounded down to the first decimal place(Note 1) Not disclosed due to tenant's request.
(Note 2) Rounded down to the first decimal place.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

52

Appraisal Value Compared to the Previous Fiscal Period (1)(Unit: Million Yen)
Compared to End of 25th Period

Appraisal Value

Property Name
End of 26th Period

End of 25th Period

Daiw a Ginza
Daiw a Ginza Annex
Daiw a Shibaura
Daiw a Minam i Aoyam a
Daiw a Sarugakucho
Daiw a A Ham am atsucho
Daiw a Jingum ae
Daiw a Shibadaim on
Daiw a Misakicho
Daiw a Shim bashi 510
Daiw a Tsukijiekim ae
Daiw a Tsukiji
Daiw a Tsukishim a
Daiw a Nihonbashi Horidom echo
Daiw a Azabudai
Daiw a Kyobashi
Daiw a Kojim achi 4-chom e
Daiw a Onarim on
Shinjuku Maynds Tow er (Note)
Daiw a SHIBUYA EDGE
Daiw a Kodem m acho
Daiw a Jim bocho
Daiw a Nishishim bashi
Daiw a Kayabacho Building
Daiw a Jinbocho 3-chom e
E SPACE TOWER
Daiw a Nihonbashi Hongokucho
shinyon curum u
Daiw a Akasaka

17,400
3,840
7,870
4,640
3,840
3,610
2,460
3,110
2,860
2,530
2,000
1,610
10,500
2,660
1,930
3,450
2,810
13,70062,600
5,190
2,260
3,620
6,570
8,170
5,060
33,5002,560
15,60014,00017,400
3,860
7,880
4,640
3,850
3,700
2,620
3,250
2,870
2,530
2,000
1,610
10,500
2,750
1,940
3,450
2,880
13,70063,000
5,210
2,230
3,680
6,860
8,190
5,220
34,7002,580
15,90015,000Difference

+20
+10
+10
+90
+160
+140
+10
+90
+10
+70
+400
+20
-30
+60
+290
+20
+160
+1,200+20+300+1,000Change

+0.5%
+0.1%
+0.3%
+2.5%
+6.5%
+4.5%
+0.3%
+3.4%
+0.5%
+2.5%
+0.6%
+0.4%
-1.3%
+1.7%
+4.4%
+0.2%
+3.2%
+3.6%
+0.8%
+1.9%
+7.1%

Book Value
End of 26th Period

12,990
2,758
8,005
4,422
3,177
2,762
2,702
2,387
2,139
2,134
1,286
1,135
6,830
2,450
1,510
3,206
2,835
13,50464,354
5,642
2,364
3,982
4,708
5,231
3,353
23,594
1,579
9,649
10,296Compared to Book Value at
End of 26th Period
Difference+4,409+1,101
-125
+217
+672
+937
-82
+862
+730
+395
+713
+474
+3,669
+299
+429
+243
+44
+195
-1,354
-432
-134
-302
+2,151+2,958+1,866+11,105+1,000+6,250+4,703

Cap Rate
Acquisition Price
End of 25th Period End of 26th Period

Change

33.9%
39.9%
-1.6%
4.9%
21.1%
33.9%
-3.0%
36.1%
34.1%
18.5%
55.4%
41.8%
53.7%
12.2%
28.4%
7.6%
1.6%
1.4%
-2.1%
-7.7%
-5.7%
-7.6%
45.7%
56.6%
55.6%
47.1%
63.3%
64.8%
45.7%

14,100
3,050
8,265
4,550
3,190
2,865
2,800
2,578
2,346
2,080
1,560
1,240
7,840
2,520
1,600
3,460
2,910
13,86066,900
5,900
2,460
4,150
5,000
5,600
3,550
24,000
1,721
9,650
9,200

3.5%
3.5%
4.0%
3.8%
4.4%
3.7%
3.8%
3.6%
3.9%
4.0%
4.2%
4.1%
4.1%
4.0%
3.9%
4.0%
3.7%
3.8%
3.2%
3.7%
4.2%
3.9%
3.5%
3.3%
3.3%
3.3%
3.9%
3.2%
3.2%

3.5%
3.5%
4.0%
3.8%
4.4%
3.7%
3.8%
3.6%
3.9%
4.0%
4.2%
4.1%
4.1%
4.0%
3.9%
4.0%
3.7%
3.8%
3.2%
3.7%
4.2%
3.9%
3.5%
3.3%
3.3%
3.2%
3.9%
3.2%
3.2%

(Note) The appraisal value in the 25th Fiscal Period for Shinjuku Maynds Tower is indicated as co-ownership values equivalent to 3/7 of the total values for the building. Co-ownership of 3/7 is indicated in the acquisition priceThis document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

53

Appraisal Value Compared to the Previous Fiscal Period (2)(Unit: Million Yen)
Appraisal Value

Compared to End of 25th Period

Property Name
End of 25th Period

Daiw a Shibuya Miyam asuzaka
Daiw a Azabu Terrace
Daiw a Ebisu 4-chom e
LAQUAS Higashi Shinjuku
Daiw a Aoyam a
Shinsen Place
Glass City Shibuya
Daiw a River Gate
Daiw a Hatchobori ekim ae
Daiw a Hatchobori ekim ae West
Daiw a Nishi-Shinjuku
Kirin Nihonbashi Building
Daiw a Higashi-Nihonbashi
Square Daikanyam a Building
Shinjuku West Building
Daiw a Kanda Mikuracho
Daiw a Kanda East
Prim e Kanda Building
Sasazuka NA Building
Daiw a Higashi-Ikebukuro
Daiw a Shinagaw a North
Daiw a Osaki 3-chom e
Daiw a Kam iooka
Integral Tow er
Daiw a Meguro Square
Daiw a Ogikubo
CONCURRED Yokoham a
Kita-Shinagaw a Gotenyam a Building
Daiw a Kitaham a
Total (Note)

End of 26th Period

9,350
16,6006,040
10,80012,4006,720
18,30030,9003,320
1,850
15,800
8,290
6,780
2,620
1,230
1,710
5,120
4,050
6,170
2,340
2,750
20,5006,810
4,540
39,40011,700506,040

10,30017,200
6,090
10,90012,4006,720
18,40031,7003,360
1,850
15,900
8,290
6,860
3,370
1,210
1,740
5,340
2,710
16,100
4,070
6,180
2,350
2,830
21,5006,820
4,610
39,9002,630
11,700537,030

Difference

+950
+600
+50
+100
+100
+800
+40
+100
+80
+750
-20
+30
+220
+20
+10
+10
+80
+1,000+10+70+500+9,550Change+10.2%
+3.6%
+0.8%
+0.9%
+0.5%
+2.6%
+1.2%
+0.6%
+1.2%
+28.6%
-1.6%
+1.8%
+4.3%
+0.5%
+0.2%
+0.4%
+2.9%
+4.9%
+0.1%
+1.5%
+1.3%
1.9%

Book Value
End of 26th Period

7,187
14,033
4,238
8,467
10,012
4,877
15,95027,932
2,934
1,722
14,004
8,415
6,314
2,377
980
1,597
4,303
2,381
16,079
2,644
7,143
1,594
1,893
15,832
5,516
3,989
38,2172,588
9,224
453,459

Compared to Book Value at
End of 26th Period
Difference

Change+3,112+3,166+1,851+2,432+2,387+1,842+2,449+3,767+425+127+1,895
-125
+545
+992
+229
+142
+1,036+328+20+1,425
-963
+755
+936
+5,667+1,303+620+1,682+41+2,475+83,570

43.3%
22.6%
43.7%
28.7%
23.8%
37.8%
15.4%
13.5%
14.5%
7.4%
13.5%
-1.5%
8.6%
41.7%
23.4%
8.9%
24.1%
13.8%
0.1%
53.9%
-13.5%
47.3%
49.4%
35.8%
23.6%
15.5%
4.4%
1.6%
26.8%
18.4%

Cap Rate
Acquisition Price
End of 25th Period End of 26th Period

7,000
14,000
4,135
8,450
9,800
4,800
16,00028,0002,871
1,647
13,710
8,180
6,370
2,280
942
1,592
4,200
2,295
15,500
2,958
7,710
1,650
2,000
15,2205,600
3,800
38,1002,500
9,481
459,736

3.6%
3.8%
3.7%
3.3%
3.2%
3.3%
3.5%
4.0%
3.5%
3.6%
3.3%
4.0%
3.9%
3.4%
3.7%
4.0%
3.9%
4.1%
4.2%
3.8%
4.5%
3.7%
3.5%
3.9%
4.3%
3.8%
-

3.5%
3.7%
3.7%
3.3%
3.2%
3.3%
3.5%
3.9%
3.5%
3.6%
3.3%
3.9%
3.9%
3.4%
3.8%
4.0%
3.7%
3.7%
3.9%
4.1%
4.2%
3.8%
4.5%
3.7%
3.5%
3.9%
4.3%
4.0%
3.8%
-

(Note) Difference and change in “Compared to End of 25th Period” do not include the impact of the properties acquired in the 26th Period.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

54

Appraisal Value at End of Fiscal Period (1)(Unit: Million Yen)
Property Name

Appraisal Value at
End of 26th Period

Summary of Appraisal Report (End of 26th Period)
Value

Daiw a Ginza
Daiw a Ginza Annex
Daiw a Shibaura
Daiw a Minam i Aoyam a
Daiw a Sarugakucho
Daiw a A Ham am atsucho
Daiw a Jingum ae
Daiw a Shibadaim on
Daiw a Misakicho
Daiw a Shim bashi 510
Daiw a Tsukijiekim ae
Daiw a Tsukiji
Daiw a Tsukishim a
Daiw a Nihonbashi Horidom echo
Daiw a Azabudai
Daiw a Kyobashi
Daiw a Kojim achi 4-chom e
Daiw a Onarim on
Shinjuku Maynds Tow er (Note)
Daiw a SHIBUYA EDGE
Daiw a Kodem m acho
Daiw a Jim bocho
Daiw a Nishishim bashi
Daiw a Kayabacho Building
Daiw a Jinbocho 3-chom e
E SPACE TOWER
Daiw a Nihonbashi Hongokucho
shinyon curum u
Daiw a Akasaka

17,400
3,860
7,880
4,640
3,850
3,700
2,620
3,250
2,870
2,530
2,000
1,610
10,500
2,750
1,940
3,450
2,880
13,70063,000
5,210
2,230
3,680
6,860
8,190
5,220
34,7002,580
15,90015,000

DCF Method

Direct Capitalization Method

17,700
3,850
7,900
4,690
3,900
3,760
2,640
3,320
2,910
2,550
2,010
1,610
10,600
2,810
1,970
3,500
2,900
14,000150,000
5,310
2,240
3,690
7,000
8,320
5,360
35,4002,610
16,20015,300Cap Rate

3.5%
3.5%
4.0%
3.8%
4.4%
3.7%
3.8%
3.6%
3.9%
4.0%
4.2%
4.1%
4.1%
4.0%
3.9%
4.0%
3.7%
3.8%
3.2%
3.7%
4.2%
3.9%
3.5%
3.3%
3.3%
3.2%
3.9%
3.2%
3.2%

Value

17,000
3,860
7,870
4,580
3,790
3,670
2,600
3,220
2,850
2,500
2,000
1,610
10,400
2,690
1,900
3,400
2,860
13,400144,000
5,100
2,220
3,670
6,800
8,130
5,160
33,9002,570
15,80014,900Discount Rate

Terminal Cap Rate

3.3%
3.3%
3.8%
3.6%
4.2%
3.5%
3.6%
3.4%
3.7%
3.8%
4.2%
4.1%
3.8%
3.8%
3.7%
3.8%
3.5%
3.6%
3.0%
3.5%
4.0%
3.9%
3.3%
3.1%
3.1%
3.0%
3.7%
3.0%
3.0%

3.7%
3.7%
4.2%
4.0%
4.6%
3.9%
4.0%
3.8%
4.1%
4.2%
4.4%
4.3%
4.3%
4.2%
4.1%
4.2%
3.9%
4.0%
3.4%
3.9%
4.4%
4.1%
3.7%
3.5%
3.5%
3.4%
4.1%
3.4%
3.4%

Integrated Value

18,800
4,880
6,800
4,250
1,820
2,290
2,750
2,170
1,760
2,230
1,920
1,590
5,580
1,620
1,300
2,180
4,550
13,200120,000
3,700
1,170
3,730
4,710
6,720
4,200
32,8001,690
15,40013,500(Note) The appraisal value for Shinjuku Maynds Tower is indicated as co-ownership values equivalent to 3/7 of the total values for the building. The other figures are indicated as 7/7 of the total values.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

55

Appraisal Value at End of Fiscal Period (2)(Unit: Million Yen)
Property Name

Appraisal Value at
End of 26th Period

Summary of Appraisal Report (End of 26th Period)
Direct Capitalization Method
Value

Daiw a Shibuya Miyam asuzaka
Daiw a Azabu Terrace
Daiw a Ebisu 4-chom e
LAQUAS Higashi Shinjuku
Daiw a Aoyam a
Shinsen Place
Glass City Shibuya
Daiw a River Gate
Daiw a Hatchobori ekim ae
Daiw a Hatchobori ekim ae West
Daiw a Nishi-Shinjuku
Kirin Nihonbashi Building
Daiw a Higashi-Nihonbashi
Square Daikanyam a Building
Shinjuku West Building
Daiw a Kanda Mikuracho
Daiw a Kanda East
Prim e Kanda Building
Sasazuka NA Building
Daiw a Higashi-Ikebukuro
Daiw a Shinagaw a North
Daiw a Osaki 3-chom e
Daiw a Kam iooka
Integral Tow er
Daiw a Meguro Square
Daiw a Ogikubo
CONCURRED Yokoham a
Kita-Shinagaw a Gotenyama Building

Daiw a Kitaham a
Total

10,30017,200
6,090
10,90012,4006,720
18,40031,7003,360
1,850
15,900
8,290
6,860
3,370
1,210
1,740
5,340
2,710
16,100
4,070
6,180
2,350
2,830
21,5006,820
4,610
39,9002,630
11,700537,030

10,40017,5006,020
11,20012,7006,830
18,60031,8003,490
1,920
16,500
8,440
7,020
3,460
1,220
1,750
5,370
2,790
16,800
4,130
6,280
2,370
2,850
21,6006,970
4,680
41,2002,710
12,000632,650

Cap Rate

3.5%
3.7%
3.7%
3.3%
3.2%
3.3%
3.5%
3.9%
3.5%
3.6%
3.3%
3.9%
3.9%
3.4%
3.8%
4.0%
3.7%
3.7%
3.9%
4.1%
4.2%
3.8%
4.5%
3.7%
3.5%
3.9%
4.3%
4.0%
3.8%
-

DCF Method
Value

10,10016,900
6,120
10,70012,2006,670
18,10031,5003,310
1,820
15,700
8,130
6,790
3,330
1,200
1,740
5,300
2,680
15,800
4,040
6,070
2,340
2,820
21,4006,750
4,580
39,3002,600
11,600612,040

Discount Rate

3.3%
3.5%
3.8%
3.1%
3.0%
3.2%
3.2%
3.6%
3.3%
3.4%
3.1%
3.6%
3.7%
3.4%
3.6%
4.0%
3.4%
3.7%
3.7%
3.9%
4.0%
3.6%
4.3%
3.5%
3.3%
3.7%
4.1%
3.8%
3.6%
-

Terminal Cap Rate

3.7%
3.9%
3.9%
3.5%
3.4%
3.5%
3.6%
4.0%
3.7%
3.8%
3.5%
4.0%
4.1%
3.6%
4.0%
4.2%
3.8%
3.9%
4.1%
4.3%
4.4%
4.0%
4.7%
3.9%
3.7%
4.1%
4.5%
4.2%
4.0%
-

Integrated Value

10,30016,8004,500
11,100
11,2004,370
17,70030,3004,110
2,090
16,100
7,670
5,270
3,120
953
1,920
5,060
2,390
14,700
2,290
4,350
1,600
2,260
13,8006,820
3,220
34,4002,520
14,100542,323

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

56

Change in the Portfolio’s Unrealized Gain/Loss(Billion Yen)

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

57

Properties Acquired after Sponsor Change (1)Acquisition
Period

9th Fiscal Period

10th Fiscal Period

11th Fiscal Period

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

15th Fiscal Period

Daiwa
Jimbocho

Daiwa
Nishi-Shimbashi

Daiwa
Kudan

Daiwa Kayabacho

Daiwa
Jimbocho 3-chome

E SPACE TOWER

Daiwa
Nihonbashi Hongokucho

Daiwa
Osaki 3-chome

shinyon curumu

Address

Chiyoda-ku, Tokyo

Minato-ku, Tokyo

Chiyoda-ku, Tokyo

Chuo-ku, Tokyo

Chiyoda-ku, Tokyo

Shibuya-ku, Tokyo

Chuo-ku, Tokyo

Shinagawa-ku, Tokyo

Shibuya-ku, Tokyo

Acquisition Price

4,150 million yen

5,000 million yen

4,000 million yen

5,600 million yen

3,550 million yen

24,000 million yen

1,721 million yen

1,650 million yen

9,650 million yen

Seller

ORIX JREIT Inc.

Japan Core
Asset II Ltd.

Shining Nova
the Fifth B TMK

Daiwa Property Co.. Ltd.

Tokyu Land Corporation

Endeavor Realty FundLtd.

Tosei Corporation

MCR Six GK

Two domestic industrial
companies

Acquisition date

March 10, 2010

August 13, 2010

September 2, 2010

March 25, 2011

March 29, 2011

July 8, 2011

May 11, 2012

September 18, 2012

December 3, 2012
April 12, 2013

Property Name

Acquisition
Period15th Fiscal Period

16th Fiscal Period

17th Fiscal Period

18th Fiscal Period

19th Fiscal Period

Daiwa
Meieki

Daiwa
Kamiooka

Daiwa
Shibuy a Dogenzaka

Daiwa
AkasakaDaiwa
Shibuy a
Miy amasuzaka

Integral Tower

Daiwa
Azabu Terrace

Daiwa
Kitahama

Daiwa
Ebisu 4-chome

Address

Nagoya-shi, Aichi

Yokohama-shi, Kanagawa

Shibuya-ku, Tokyo

Minato-ku, Tokyo

Shibuya-ku, Tokyo

Suginami-ku, Tokyo

Minato-ku, Tokyo

Osaka-shi, Osaka

Shibuya-ku, Tokyo

Acquisition Price

5,300 million yen

2,000 million yen

4,500 million yen

9,200 million yen

7,000 million yen

15,220 million yen

14,000 million yen

9,481 million yen

4,135 million yen

SellerDomestic special purpose
company

Shimizu Corporation

Domestic special purpose
company

Hakuba Capital 1 TMK

E Buildings Limited
Liability Company

Ogikubo Building
Y. K.

Azabu Green
Terrace GK

GK North Beach

Domestic industrial
company

Acquisition dateFebruary 1, 2013

March 1, 2013

July 3, 2013

August 9, 2013

September 27, 2013

May 29, 2014

July 4, 2014

August 1, 2014

December 1, 2014

Property Name

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

58

Properties Acquired after Sponsor Change (2)Acquisition Period

19th Fiscal Period

20th Fiscal Period

LAQUAS Higashi
Shinjuku

Daiwa
AoyamaShinsen Place

Glass City Shibuya

Daiwa
Meguro Square

Daiwa River Gate

Daiwa
Hatchobori ekimae

21st Fiscal Period
Daiwa
Hatchobori ekimae West

Daiwa
Nishi-Shinjuku Building

Kirin
Nihonbashi Building

22nd Fiscal Period
Daiwa Higashinihonbashi

Property Name

Address

Shinjuku-ku, Tokyo

Shibuya-ku, Tokyo

Shibuya-ku, Tokyo

Shibuya-ku, Tokyo

Meguro-ku, Tokyo

Chuo-ku, Tokyo

Chuo-ku, Tokyo

Chuo-ku, Tokyo

Shinjuku-ku, Tokyo

Chuo-ku, Tokyo

Chuo-ku, Tokyo

Acquisition Price

8,450 million yen

9,800 million yen

4,800 million yen

16,000 million yen

5,600 million yen

28,000 million yen

2,871 million yen

1,647 million yen

13,710 million yen

8,180 million yen

6,370 million yen

SellerHigashi Shinjuku Building
TMK

Domestic special
purpose company

Domestic special
purpose company

Glass City TMK

Meguro Place TMK

Temuzu TMK

Domestic industrial
company

Domestic industrial
company

Oversea company

Kirin Beer
Marketing Co., Ltd.

Domestic special purpose
company

Acquisition date

December 3, 2014

March 2, 2015

March 2, 2015

May 1, 2015

May 1, 2015

June 2, 2015

September 11, 2015

September 11, 2015

March 29, 2016

May 26, 2016

June 1, 2016

Acquisition Period

22nd Fiscal Period
Square Daikanyama
Building

Shinjuku West Building

23rd Fiscal Period
Daiwa
Kanda Mikuracho

Daiwa Ogikubo

25th Fiscal Period
CONCURRED
Yokohama

Daiwa
Kanda East

26th Fiscal Period
Prime Kanda
Building

Kita-Shinagawa
Gotenyama Building

27th Fiscal Period

Sasazuka NA Building

Sasazuka South
Building

Total
Property Name

Address

Shibuya-ku, Tokyo

Shinjuku-ku, Tokyo

Suginami-ku, Tokyo

Chiyoda-ku, Tokyo

Yokohama-shi, Kanagawa

Chiyoda-ku, Tokyo

Acquisition Price

2,280 million yen

942 million yen

3,800 million yen

1,592 million yen

38,100 million yen

4,200 million yen

SellerHulic Co., Ltd.

GK TC1GK TC1OH Real EstateManagement Co., Ltd.

GK Yokohama Office
Management

Domestic company

Acquisition dateJune 29, 2016

July 21, 2016

July 21, 2016

December 21, 2016

January 11, 2018

January 12, 2018

Chiyoda-ku, Tokyo
①1,800 million yen② 495 million yen① Domestic special
purpose company② individual① June 7, 2018
② November 1, 2018

Shinagawa-ku, Tokyo

Shinjuku-ku, Tokyo

Shinjuku-ku, Tokyo－

2,500 million yen

15,500 million yen

3,000 million yen

309,794 million yen

Danke Holdings Co., Ltd.

September 13, 2018

Domestic special purpose Domestic special purpose
company
company

October 30, 2018

December 27, 2018－－

(Note) The sum of ; i) the total acquisition price from the time of the above sponsor change up to December 27, 2018 and ii) prices for additional acquisition of existing properties or of the site in existing properties during the same period, is 310,214 million yen.
“Ltd.” and “TMK” (Tokutei Mokuteki Kaisha) in sellers’ names refer to a limited liability company and special purpose company, respectively.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

59

Portfolio Performance Summary (1)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Ginza

Daiwa Ginza Annex

Daiwa Shibaura

Daiwa Minami Aoyama

Daiwa Sarugakucho

Daiwa A Hamamatsucho

Daiwa Jingumae

Property Nam e

Acquisition Price (million yen)

14,10025th FP

3,050

26th FP

25th FP

8,265
26th FP

25th FP

4,550
26th FP

25th FP

3,190
26th FP

25th FP

2,865
26th FP

25th FP

2,800
26th FP

25th FP

26th FPBook Value (million yen)

13,064

12,990

2,767

2,758

8,014

8,005

4,425

4,422

3,194

3,177

2,777

2,762

2,711

2,702

Appraisal Value (million yen)

17,40017,400

3,840

3,860

7,870

7,880

4,640

4,640

3,840

3,850

3,610

3,700

2,460

2,620

Occupancy Rate (% )

95.0

100

100.0

100.0

99.1

98.3

84.8

100.0

100.0

100.0

100.0

100.0

100.0

78.5

PML (% ) (Note 1)

4.53

4.53

3.97

3.97

3.82

3.82

9.19

9.19

7.14

7.14

3.79

3.79

13.33

13.33

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Best Property

Best Property

Xymax AlphaBest Property

Property Partners

Best Property

Best Property

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)

380,455

400,727

94,457

96,374259,169

261,440

137,607

124,760- (Note 6)- (Note 6)

135,078

133,551

74,78565,739Rent (incl. common serv ice fees)

371,555

400,727

94,457

96,374257,404

259,747

127,380

124,760- (Note 6)- (Note 6)

135,078

133,551

74,78565,739

8,900

0

0

0

1,764

1,693

10,2260- (Note 6)- (Note 6)

0

0

0

0

99,871

94,25821,29839,07159,93562,35624,86232,021- (Note 6)- (Note 6)

59,47760,806

15,682

19,701

Administrativ e Expenses

18,635

12,680

3,837

5,730

12,217

12,040

3,710

6,082

- (Note 6)- (Note 6)

8,298

8,303

2,858

6,256

Utility Charges

24,33429,614

5,789

7,513

18,75820,181

6,284

8,115

- (Note 6)- (Note 6)

8,566

9,320

4,690

4,776

Property Management Fee

5,446

6,012

1,467

1,422

3,931

3,926

2,154

1,854

- (Note 6)- (Note 6)

2,054

1,979

1,200

1,200

Tax and Public Due

27,911

29,743

9,104

9,755

19,58820,495

11,931

12,479- (Note 6)- (Note 6)

8,770

9,049

6,357

6,736

369

376

86

87

338

345

134

136

- (Note 6)- (Note 6)

157

160

73

74

11,331

2,686

1,013

14,560

5,080

5,367

646

3,352

- (Note 6)- (Note 6)

2,231

2,594

496

649

Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Non-life Insurance Costs
Repair Expenses
Other Expenses

11,841

13,144

0

0

20

0

0

0

- (Note 6)- (Note 6)

29,40029,40077(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

280,584

306,468

73,15857,302

199,234

199,084

112,745

92,73845,607

94,03975,60072,745

59,102

46,037

Annualized NOI (thousand yen)

562,710611,262

146,719

114,291

399,562

397,080

226,110

184,970

91,465

187,565

151,616

145,093

118,529

91,823

4.3%

4.7%

5.3%

4.1%

5.0%

5.0%

5.1%

4.2%

2.9%

5.9%

5.5%

5.3%

4.4%

3.4%

Depreciation and amortization (thousand yen)

74,86474,887

10,30010,27029,682

29,851

14,273

14,486- (Note 6)- (Note 6)

15,11915,127

9,221

9,233

Repair Work (thousand yen)

8,900

0

0

0

271

193

0

0

- (Note 6)- (Note 6)

0

0

0

0

0

0

0

0

64

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

(Reference)

NOI Yield (Note 5)

Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

60

Portfolio Performance Summary (2)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Shibadaimon

Daiwa Misakicho

Daiwa Shimbashi 510

Daiwa Tsukijiekimae

Daiwa Tsukiji

Daiwa Nihonbashi
Horidomecho

Daiwa Tsukishima

Property Nam e

Acquisition Price (million yen)

2,578
25th FP

2,346
26th FP

25th FP

2,080
26th FP

25th FP

1,560
26th FP

25th FP

1,240
26th FP

25th FP

7,840
26th FP

25th FP

2,520
26th FP

25th FP

26th FPBook Value (million yen)

2,398

2,387

2,151

2,139

2,141

2,134

1,289

1,286

1,141

1,135

6,888

6,830

2,465

2,450

Appraisal Value (million yen)

3,110

3,250

2,860

2,870

2,530

2,530

2,000

2,000

1,610

1,610

10,50010,500

2,660

2,750

Occupancy Rate (% )

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

PML (% ) (Note 1)

3.72

3.72

4.24

4.24

5.51

5.51

4.23

4.23

4.98

4.98

4.87

4.87

4.68

4.68

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Best Property

Best Property

Property Partners

MS Building Support

Xymax Alpha

Property Partners

Best Property

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)

86,15587,641- (Note 6)- (Note 6)

66,205

77,23958,61760,621

51,87654,981

270,637

281,985

84,18580,917

Rent (incl. common serv ice fees)

86,15587,641- (Note 6)- (Note 6)

66,205

77,23958,61760,621

51,726

51,766

270,637

281,985

84,18580,20100- (Note 6)- (Note 6)

0

0

0

0

150

3,215

0

0

0

716

19,664

21,382- (Note 6)- (Note 6)

27,43920,584

15,33018,911

11,367

29,144

43,10644,225

17,52019,770Administrativ e Expenses

5,820

5,657

- (Note 6)- (Note 6)

5,413

6,540

3,071

5,966

2,342

2,304

8,186

7,408

3,841

5,185

Utility Charges

5,896

7,021

- (Note 6)- (Note 6)

5,039

6,161

5,853

6,330

2,849

2,834

14,277

15,956

4,967

4,828

Property Management Fee

1,294

1,315

- (Note 6)- (Note 6)

1,200

1,200

1,200

1,200

1,200

1,236

4,211

4,230

1,281

1,214

Tax and Public Due

6,254

6,567

- (Note 6)- (Note 6)

5,664

6,051

5,067

5,235

3,861

4,056

13,727

14,265

6,719

6,993

Non-life Insurance Costs

107

108

- (Note 6)- (Note 6)

109

111

86

87

55

56

256

261

116

118

Repair Expenses

291

712

- (Note 6)- (Note 6)

10,012

520

34

74

1,058

18,656

2,446

2,103

594

1,429

Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Other Expenses

00- (Note 6)- (Note 6)

0

0

18

18

0

0

0

0

0

0

(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

66,491

66,25963,00564,431

38,76556,65443,28741,70940,50825,836

227,530

237,760

66,664

61,147

Annualized NOI (thousand yen)

133,347

132,156

126,356

128,51177,744112,999

86,812

83,19081,23951,532456,311474,221

133,695

121,960

5.6%

5.5%

5.9%

6.0%

3.6%

5.3%

6.7%

6.5%

7.1%

4.5%

6.6%

6.9%

5.4%

5.0%

11,436

10,921- (Note 6)- (Note 6)

8,570

9,234

13,141

13,311

7,452

7,626

57,48457,643

15,032

15,31800- (Note 6)- (Note 6)

0

0

0

0

0

0

0

0

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

0

0

0

0

0

0

(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

61

Portfolio Performance Summary (3)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Azabudai

Daiwa Kyobashi

Daiwa Kojimachi 4-chome

Shinjuku Maynds Tower(Note 6)

Daiwa Onarimon

Daiwa SHIBUYA EDGE

Daiwa Kodemmacho

Property Nam e

Acquisition Price (million yen)

1,600
25th FP

3,460
26th FP

25th FP

2,910
26th FP

25th FP

13,86026th FP

25th FP

66,90026th FP

25th FP

5,900

26th FP

25th FP

2,460
26th FP

25th FP

26th FPBook Value (million yen)

1,516

1,510

3,225

3,206

2,846

2,835

13,34813,50464,53864,354

5,655

5,642

2,374

2,364

Appraisal Value (million yen)

1,930

1,940

3,450

3,450

2,810

2,880

13,70013,70062,60063,000

5,190

5,210

2,260

2,230

Occupancy Rate (% )

100.0

100.0

100.0

100.0

100.0

100.0

100.0

96.3

99.8

99.9

100.0

100.0

100.0

100.0

PML (% ) (Note 1)

6.64

6.64

4.51

4.51

6.19

6.19

3.89

3.89

2.03

2.03

1.56

1.56

4.19

4.19

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Best Property

Best Property

Best Property

Xymax Alpha

Xymax Alpha

Xymax Alpha

Property Partners

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)

56,44452,03992,251

104,723

86,13787,363355,219355,291

1,861,881

1,324,664

126,961

128,849

64,96865,777

Rent (incl. common serv ice fees)

55,571

52,03992,251

104,723

86,13787,363355,219355,291

1,861,818

1,324,664

126,961

128,849

64,96865,777

872

0

0

0

0

0

0

0

62

0

0

0

0

0

12,172

13,561

23,76424,25929,49930,543

101,352

106,419603,265

399,443

50,844

22,16813,732

15,662Administrativ e Expenses

2,454

3,144

7,063

4,280

5,483

3,796

12,671

11,900110,808

72,229

5,223

4,352

2,841

4,099

Utility Charges

3,134

3,598

7,395

9,366

6,765

7,761

22,88524,019201,302139,004

6,991

7,775

4,458

5,216

Property Management Fee

1,200

1,200

1,434

1,571

1,288

1,310

3,553

3,526

13,359

9,335

1,905

1,933

1,218

1,200

Tax and Public Due

4,916

5,081

7,110

7,482

14,946

16,05534,92537,770253,508

172,096

7,226

7,587

3,642

3,792

Non-life Insurance Costs

65

66

112

115

126

129

355

361

2,399

1,633

92

94

82

84

Repair Expenses

402

470

596

1,443

889

1,490

26,961

28,83920,0682,908

29,404

424

666

445

Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Other Expenses

0

0

50

0

0

0

0

0

1,819

2,235

0

0

822

822

(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

44,271

38,477

68,48780,46456,63856,819253,866

248,872

1,258,615

925,220

76,117

106,680

51,235

50,115

Annualized NOI (thousand yen)

88,78676,745

137,351

160,488

113,587

113,329

509,128

496,384

2,524,145

1,845,385

152,652

212,778

102,753

99,957

5.9%

5.1%

4.3%

5.0%

4.0%

4.0%

3.8%

3.7%

2.6%

2.9%

2.7%

3.8%

4.3%

4.2%

9,173

9,234

20,027

19,93013,137

13,804

31,52932,794299,952

200,933

16,59816,727

9,731

9,731

0

0

0

0

0

0

0

0

0

0

0

0

0

0

14

0

0

0

0

0

0

0

0

0

0

0

0

0

(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) 3/7 of co-ownership interest was sold in 25th FP. The book value of Shinjuku Maynds Tower in (3) NOI Yield for 25th FP on the table is the weighted average of book value at the beginning of fiscal period and book value at the end of fiscal period.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

62

Portfolio Performance Summary (4)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Jimbocho

Daiwa Nishishimbashi

Daiwa Kayabacho Building

Daiwa
Jinbocho 3-chome

Daiwa Nihonbashi
Hongokucho

E SPACE TOWER

shinyon curumu

Property Nam e

Acquisition Price (million yen)

4,150
25th FP

5,000
26th FP

25th FP

5,600
26th FP

25th FP

3,550
26th FP

25th FP

24,00026th FP

25th FP

1,721

26th FP

25th FP

9,650
26th FP

25th FP

26th FPBook Value (million yen)

4,003

3,982

4,735

4,708

5,259

5,231

3,373

3,353

23,61023,594

1,592

1,579

9,685

9,649

Appraisal Value (million yen)

3,620

3,680

6,570

6,860

8,170

8,190

5,060

5,220

33,50034,700

2,560

2,580

15,60015,900Occupancy Rate (% )

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

93.3

100.0

100.0

99.5

100.0

PML (% ) (Note 1)

5.05

5.05

3.76

3.76

4.50

4.50

5.33

5.33

3.11

3.11

3.80

3.80

4.44

4.44

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Japan Property Solutions

Xymax Alpha

Property Partners

Japan Property Solutions

Xymax AlphaMS Building Support

MS Building Support

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)

106,977

109,205

174,861

176,290- (Note 6)- (Note 6)

115,919

113,890742,540

739,61457,23071,583370,014372,712

Rent (incl. common serv ice fees)

106,977

109,115

174,861

176,290- (Note 6)- (Note 6)

104,483

113,890742,540

739,61457,23071,583370,014372,712

0

90

0

0

- (Note 6)- (Note 6)

11,436

0

0

0

0

0

0

0

28,88127,00549,75446,097- (Note 6)- (Note 6)

25,69328,585

177,177

185,638

13,681

11,94080,14787,555Administrativ e Expenses

5,028

4,816

14,03913,134- (Note 6)- (Note 6)

8,125

6,082

53,691

52,914

4,382

2,166

18,745

21,296

Utility Charges

7,078

7,625

11,005

12,623- (Note 6)- (Note 6)

6,459

8,482

46,04957,942

3,171

3,347

21,96326,758Property Management Fee

1,200

1,200

2,311

2,315

- (Note 6)- (Note 6)

1,568

1,911

7,287

7,504

1,200

1,200

3,724

3,754

Tax and Public Due

10,898

11,53415,750

16,245- (Note 6)- (Note 6)

9,366

9,843

56,76259,645

4,398

4,538

33,35735,212Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Non-life Insurance Costs

118

121

214

218

- (Note 6)- (Note 6)

109

111

565

577

67

69

280

288

Repair Expenses

4,297

1,668

6,432

1,561

- (Note 6)- (Note 6)

64

2,153

12,405

6,981

461

618

2,050

245

Other Expenses

260

40

0

0

- (Note 6)- (Note 6)

0

0

416

72

0

0

25

0

(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

78,09682,199125,106

130,192

148,621

148,169

90,22585,305565,363

553,976

43,54859,642289,866

285,157

Annualized NOI (thousand yen)

156,621

163,950

250,901

259,674

298,059

295,529

180,947

170,144

1,133,832

1,104,925

87,336

118,959

581,326

568,756

3.9%

4.1%

5.3%

5.5%

5.7%

5.6%

5.4%

5.1%

4.8%

4.7%

5.5%

7.5%

6.0%

5.9%

21,06921,08734,98535,128- (Note 6)- (Note 6)

19,836

19,83670,34773,26913,274

13,29336,11636,4810000- (Note 6)- (Note 6)

0

0

0

0

0

0

0

0

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

0

0

0

0

(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

63

Portfolio Performance Summary (5)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Shibuya
Miyamasuzaka

Daiwa Akasaka

Daiwa Azabu Terrace

Daiwa Ebisu 4-chome

LAQUAS Higashi Shinjuku

Daiwa Aoyama

Shinsen Place

Property Nam e

Acquisition Price (million yen)

9,200
25th FP

7,000
26th FP

25th FP

14,00026th FP

25th FP

4,135

26th FP

25th FP

8,450
26th FP

25th FP

9,800
26th FP

25th FP

4,800
26th FP

25th FP

26th FPBook Value (million yen)

9,422

10,296

7,200

7,187

14,08014,033

4,254

4,238

8,484

8,467

10,031

10,012

4,890

4,877

Appraisal Value (million yen)

14,00015,0009,350

10,30016,60017,200

6,040

6,090

10,80010,90012,40012,400

6,720

6,720

Occupancy Rate (% )

100.0

100.0

100.0

100.0

99.6

99.6

100.0

100.0

100.0

100.0

100.0

91.5

100.0

100.0

PML (% ) (Note 1)

7.14

7.14

5.64

5.64

2.67

2.67

2.44

2.44

4.46

4.46

4.42

4.42

6.21

6.21

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Xy max AlphaBest Property

Japan Property Solutions

MS Building Support

ITOCHU Urban Community

MS Building Support

MS Building Support

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)

335,679

351,389

246,718

269,737

466,978

485,183- (Note 6)- (Note 6)

226,481234,120

248,326

259,612- (Note 6)- (Note 6)

Rent (incl. common serv ice fees)

335,679

351,389

246,718

264,939

466,978

485,183- (Note 6)- (Note 6)

226,481234,120

248,326

243,840- (Note 6)- (Note 6)

0

0

0

4,797

0

0

- (Note 6)- (Note 6)

0

0

0

15,772- (Note 6)- (Note 6)

110,522

306,41159,71576,687

109,925

121,007- (Note 6)- (Note 6)

52,791

48,52736,506

34,662- (Note 6)- (Note 6)

Administrativ e Expenses

23,242

28,113

19,84535,477

26,19527,950- (Note 6)- (Note 6)

15,654

8,718

9,182

8,682

- (Note 6)- (Note 6)

Utility Charges

32,03730,613

13,896

15,40245,77351,852- (Note 6)- (Note 6)

12,50015,011

6,841

8,483

- (Note 6)- (Note 6)

Property Management Fee

3,763

3,846

2,951

3,262

4,212

4,285

- (Note 6)- (Note 6)

1,200

1,200

2,981

2,747

- (Note 6)- (Note 6)

Tax and Public Due

33,15034,40020,12921,13831,72533,088- (Note 6)- (Note 6)

20,33421,095

12,71013,446- (Note 6)- (Note 6)

357

364

250

256

508

517

- (Note 6)- (Note 6)

262

267

129

132

- (Note 6)- (Note 6)

Repair Expenses

17,970209,072

2,581

1,151

1,509

3,213

- (Note 6)- (Note 6)

2,613

2,008

4,661

1,170

- (Note 6)- (Note 6)

Other Expenses

0

0

60

0

0

99

- (Note 6)- (Note 6)

226

226

0

0

- (Note 6)- (Note 6)(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

225,156

44,977

187,002

193,049

357,053

364,176-60,268

141,069

173,689

185,593

211,819

224,949

116,938

125,085

Annualized NOI (thousand yen)

451,550

89,709375,032

385,044716,068

726,362-120,867

281,368

348,332

370,173424,802448,670

234,519

249,486

4.8%

0.9%

5.2%

5.4%

5.1%

5.2%

-2.8%

6.6%

4.1%

4.4%

4.2%

4.5%

4.8%

5.1%

27,35058,53022,50022,11951,31451,789- (Note 6)- (Note 6)

32,46632,735

19,554

19,560- (Note 6)- (Note 6)

0

0

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

- (Note 6)- (Note 6)

Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Non-life Insurance Costs(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

64

Portfolio Performance Summary (6)Fiscal Period ended November 2018 (26th FP Results by Property)
Glass City Shibuya

Daiwa River Gate

Daiwa Hatchobori ekimaeWestDaiwa Hatchobori ekimae

Daiwa Nishi-Shinjuku
Building

Kirin Nihonbashi Building

Daiwa Higashi-nihonbashi
Building

Property Nam e

Acquisition Price (million yen)

16,00025th FP

28,00026th FP

25th FP

2,871

26th FP

25th FP

1,647
26th FP

25th FP

13,71026th FP

25th FP

8,180

26th FP

25th FP

6,370
26th FP

25th FP

26th FPBook Value (million yen)

15,97915,95028,001

27,932

2,944

2,934

1,726

1,722

13,947

14,004

8,278

8,415

6,339

6,314

Appraisal Value (million yen)

18,30018,40030,90031,700

3,320

3,360

1,850

1,850

15,80015,900

8,290

8,290

6,780

6,860

Occupancy Rate (% )

100.0

100.0

99.4

99.3

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

PML (% ) (Note 1)

1.61

1.61

1.76

1.76

5.89

5.89

7.03

7.03

4.32

4.32

5.76

5.76

4.37

4.37

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Xymax AlphaBest Property

ITOCHU Urban Community

ITOCHU Urban Community

MS Building Support

Japan Property Solutions

ITOCHU Urban Community

182

183

182

183

182

183

182

183

182

183

182

183

182

183

(1) Property-related Rev enues (thousand yen)419,281

423,416

1,038,944

1,068,211

80,09683,426

46,58347,062335,754338,267- (Note 6)- (Note 6)

170,674

174,957

Rent (incl. common serv ice fees)

419,281

423,416

1,035,249

1,064,809

80,09683,426

46,58347,062335,754338,267- (Note 6)- (Note 6)

170,674

174,957

0

0

3,695

3,402

0

0

0

0

0

0

- (Note 6)- (Note 6)00

116,475

79,742

323,792

341,516

23,71624,443

11,753

11,90470,63584,680- (Note 6)- (Note 6)

33,366

31,662Administrativ e Expenses

11,80813,04173,28873,168

6,618

6,184

3,351

3,244

13,37313,006- (Note 6)- (Note 6)

9,962

5,977

Utility Charges

23,23830,614

119,803130,113

5,560

7,292

2,804

2,972

16,847

20,485- (Note 6)- (Note 6)

9,309

11,182Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Property Management Fee

4,397

4,862

10,587

10,666

1,200

1,200

1,200

1,200

2,343

2,379

- (Note 6)- (Note 6)

1,715

1,754

Tax and Public Due

27,191

28,551

103,867

103,439

8,979

9,263

4,025

4,220

35,32037,451- (Note 6)- (Note 6)

11,337

11,672Non-life Insurance Costs

313

320

1,517

1,546

109

112

56

57

267

272

- (Note 6)- (Note 6)

178

181

Repair Expenses

49,5252,353

14,606

22,583

1,248

390

315

209

2,483

11,084- (Note 6)- (Note 6)

863

844

Other Expenses

0

0

120

0

0

0

0

0

0

0

- (Note 6)- (Note 6)050(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

302,805

343,674

715,152

726,695

56,37958,982

34,82935,157265,119

253,586

108,940

137,170

137,308

143,295

Annualized NOI (thousand yen)607,274

685,471

1,434,234

1,449,419

113,068

117,642

69,85070,123531,694505,787

218,479

273,590

275,371285,807

3.8%

4.3%

5.1%

5.2%

3.8%

4.0%

4.0%

4.1%

3.8%

3.6%

2.6%

3.3%

4.3%

4.5%

33,054

33,110166,152

129,311

10,310

10,310

5,239

5,026

18,35919,399- (Note 6)- (Note 6)

25,12625,148

0

0

705

903

0

0

0

0

0

0

- (Note 6)- (Note 6)

0

0

0

0

222

206

0

0

0

0

0

0

- (Note 6)- (Note 6)00(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

65

Portfolio Performance Summary (7)Fiscal Period ended November 2018 (26th FP Results by Property)
Square Daikanyama
Building

Daiwa Kanda Mikuracho
Building

Shinjuku West Building

Prime Kanda
Building (Note 7)

Daiwa Kanda East

Sasazuka NA Building

Daiwa Higashi-Ikebukuro

Property Name

Acquisition Price (million yen)

2,280
25th FP

942
26th FP

25th FP

1,592
26th FP

25th FP

4,200
26th FP

25th FP

2,295
26th FP

25th FP

15,50026th FP

25th FP

2,958

26th FP

25th FP

26th FPBook Value (million yen)

2,383

2,377

981

980

1,601

1,597

4,249

4,303

-

2,381

-

16,079

2,661

2,644

Appraisal Value (million yen)

2,620

3,370

1,230

1,210

1,710

1,740

5,120

5,340

-

2,710

-

16,100

4,050

4,070

Occupancy Rate (% )

100.0

100.0

100.0

99.0

100.0

100.0

91.8

100.0

-

100.0

-

100.0

100.0

100.0

PML (% ) (Note 1)

6.21

6.21

8.28

8.28

6.01

6.01

3.86

3.86

-

5.12

-

1.52

3.55

3.55

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Xymax Alpha

ITOCHU Urban Community

Best Property

ITOCHU Urban Community

MS Building Support

Jones Lang LaSalleBest Property

182

183

182

183

182

183

140

183

-

177

-

32

182

183

(1) Property-related Rev enues (thousand yen)

- (Note 6)- (Note 6)

38,09838,45446,53049,69589,922

127,965-

48,804-73,721

127,028

131,744

Rent (incl. common serv ice fees)- (Note 6)- (Note 6)

38,09838,45446,53049,69587,622

127,965-

48,804-73,675127,028

131,744

Other Rev enues (Note 3)- (Note 6)- (Note 6)

0

0

0

0

2,300

0

-

0

-

46

0

0

- (Note 6)- (Note 6)

31,23917,97911,441

24,681

16,38837,019

-

9,673

-

7,922

37,11735,183Administrativ e Expenses- (Note 6)- (Note 6)

2,004

2,562

4,463

3,481

7,585

11,652

-

4,891

-

6,324

9,159

8,697

Utility Charges- (Note 6)- (Note 6)

2,467

2,865

2,109

2,802

5,514

9,910

-

2,801

-

0

13,246

14,360Property Management Fee- (Note 6)- (Note 6)

1,200

1,200

1,200

1,200

995

1,300

-

1,160

-

743

1,938

1,982

Tax and Public Due- (Note 6)- (Note 6)

3,113

3,126

3,373

3,496

8

92

-

70

-

0

8,580

8,567

Non-life Insurance Costs- (Note 6)- (Note 6)

36

37

47

48

99

131

-

49

-

127

188

191

Repair Expenses- (Note 6)- (Note 6)

22,417

8,188

248

13,651

2,185

13,932

-

693

-

726

4,003

1,382

Other Expenses(2) Property-related Expenses (thousand yen)

- (Note 6)- (Note 6)

0

0

0

0

0

0

-

7

-

0

0

0

(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

49,68149,757

6,859

20,47435,08925,01473,53390,945-

39,130-65,79889,911

96,561

Annualized NOI (thousand yen)

99,63599,242

13,756

40,83770,37149,892

191,712181,394-

80,692-

750,518

180,316

192,595

4.2%

4.2%

1.4%

4.2%

4.4%

3.1%

4.5%

4.2%

-

3.4%

-

4.7%

6.8%

7.3%

Depreciation and amortization (thousand yen)

- (Note 6)- (Note 6)

2,248

2,220

4,952

5,008

13,47818,020

-

4,886

-

19,593

23,83724,039Repair Work (thousand yen)

- (Note 6)- (Note 6)

0

0

0

0

0

0

-

0

-

0

0

0

(Reference)

NOI Yield (Note 5)

Proceeds from Amortization of Leasehold andSecurity (thousand yen)
- (Note 6)- (Note 6)
0
0
0
0
0
0
0
0
0
(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.
(Note 6) Not disclosed due to tenant's request.
(Note 7) Acquisition made in two batches in 26th FP. The book value of Prime Kanda Building in (3) NOI Yield for 26th FP on the table is the weighted average of book value at the end of October 2018 and book value at the end of fiscal period.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

066

Portfolio Performance Summary (8)Fiscal Period ended November 2018 (26th FP Results by Property)
Daiwa Shinagawa North

Daiwa Osaki 3-chome

Daiwa Kamiooka

Integral Tower

Daiwa Meguro Square

Daiwa Ogikubo

CONCURRED Yokohama

Property Nam e

Acquisition Price (million yen)

7,710
25th FP

1,650
26th FP

25th FP

2,000
26th FP

25th FP

15,22026th FP

25th FP

5,600

26th FP

25th FP

3,800
26th FP

25th FP38,10026th FP

25th FP

26th FPBook Value (million yen)

7,169

7,143

1,605

1,594

1,911

1,893

15,917

15,832

5,531

5,516

3,989

3,989

38,31538,217

Appraisal Value (million yen)

6,170

6,180

2,340

2,350

2,750

2,830

20,50021,500

6,810

6,820

4,540

4,610

39,40039,900Occupancy Rate (% )

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

93.2

99.3

PML (% ) (Note 1)

7.19

7.19

6.14

6.14

6.29

6.29

1.18

1.18

1.68

1.68

6.41

6.41

0.92

0.92

Property Management Company

Profits from property-related activities(Note 2)

Number of operating days

Best Property

Xymax Alpha

Xymax Alpha

Xymax Alpha

Xymax Alpha

ITOCHU Urban Community

Jones Lang LaSalle

182

183

182

183

182

183

182

183

182

183

182

183

141

183

(1) Property-related Rev enues (thousand yen)

191,154

199,637

65,42465,72993,32593,196592,062

644,854

148,235

158,434

120,889

127,346735,742

942,799

Rent (incl. common serv ice fees)

191,154

199,637

65,42465,72993,32593,196592,062

644,854

148,235

158,434

120,889

127,346735,742

942,799

0

0

0

0

0

0

0

0

0

0

0

0

0

0

51,842

54,634

11,295

11,496

20,64625,074

257,037

197,128

33,807

34,176

26,07355,898110,876

175,760

Administrativ e Expenses

14,667

14,425

2,512

2,329

4,467

4,354

51,29855,790

9,697

7,392

9,407

7,955

53,381

72,382

Utility Charges

14,418

16,778

3,122

3,480

7,981

8,590

71,74681,652

7,948

9,492

5,752

6,767

47,02690,435

Property Management Fee

2,876

2,986

1,200

1,200

1,213

1,213

6,573

7,163

1,849

2,103

1,548

1,404

4,389

5,647

Tax and Public Due

18,327

18,981

3,922

4,006

6,283

6,435

44,423

44,952

13,523

13,882

7,772

8,089

1

7

290

295

58

60

100

103

743

756

147

150

126

128

594

771

Repair Expenses

1,261

1,167

480

420

600

4,376

81,822

6,633

640

1,155

1,466

31,552

5,132

6,394

Other Expenses

0

0

0

0

0

0

430

180

0

0

0

0

350

120

(3) NOI (=(1)-(2)) (Note 4) (thousand yen)

139,312145,00254,12854,23372,67868,121

335,025

447,725

114,427

124,257

94,81671,448624,866

767,038

Annualized NOI (thousand yen)

279,389

289,212

108,554

108,170

145,756

135,871

671,891

893,005

229,483

247,836

190,153

142,507

1,617,561

1,529,886

3.9%

4.0%

6.8%

6.8%

7.6%

7.2%

4.2%

5.6%

4.1%

4.5%

4.8%

3.6%

4.2%

4.0%

34,93735,78911,408

11,41918,06518,06586,72999,266

22,79022,933

12,881

12,60393,310112,466

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

Other Rev enues (Note 3)(2) Property-related Expenses (thousand yen)

Non-life Insurance Costs(Reference)

NOI Yield (Note 5)
Depreciation and amortization (thousand yen)Repair Work (thousand yen)
Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

67

Portfolio Performance Summary (9)Fiscal Period ended November 2018 (26th FP Results by Property)
Kita-Shinagawa Gotenyama
Building

Daiwa Meieki (Note 6)

Daiwa Kitahama

Total (Note 7)

Property Nam e

Acquisition Price (million yen)

2,500
25th FP

5,300
26th FP

25th FP

9,481
26th FP

25th FP

26th FP

439,441

459,736

25th FP

26th FPBook Value (million yen)

-

2,588

-

-

9,276

9,224

432,377

453,459

Appraisal Value (million yen)

-

2,630

-

-

11,70011,700506,040

537,030

Occupancy Rate (% )

-

58.6

-

-

100.0

100.0

99.0

98.9

PML (% ) (Note 1)

-

7.07

-

-

3.48

3.48

1.96

1.95

Best Property

Number of operating days

-

79

19

-

182

183

182

183

(1) Property-related Rev enues (thousand yen)-

21,55026,729-310,496358,318

12,910,074

13,193,848

Rent (incl. common serv ice fees)-

21,55024,729-310,496358,318

12,868,665

13,164,114

Other Rev enues (Note 3)

-

0

2,000

-

0

0

41,40929,733-

3,749

27,465-

99,622

96,331

3,635,334

3,597,574

Administrativ e Expenses

-

1,799

2,914

-

28,315

19,977

817,951

779,934

Utility Charges

-

1,025

3,531

-

29,90235,772

998,451

1,093,880

Property Management Fee

-

541

336

-

4,703

5,415

144,270

148,272

Tax and Public Due-

618,840-32,77033,833

1,108,572

1,041,948

Non-life Insurance Costs

-

34

34

-

492

502

14,24914,085

Repair Expenses

-

342

1,808

-

3,340

734

505,704

472,933

Other Expenses

Profits from property-related activities(Note 2)

Property Management Company(2) Property-related Expenses (thousand yen)

Xymax Alpha

Japan Property Solutions

-

0

0

-

96

96

46,13446,519(3) NOI (=(1)-(2)) (Note 4) (thousand yen)-

17,800-736-

210,874

261,987

9,274,739

9,596,274

Annualized NOI (thousand yen)-

82,243--422,907522,542

19,010,552

19,808,775

-

3.2%

-

-

4.6%

5.7%

4.1%

4.4%

Depreciation and amortization (thousand yen)

-

2,821

5,949

-

53,88154,043

1,772,039

1,734,275

Repair Work (thousand yen)

-

0

2,000

-

0

0

11,876

1,096

-

0

0

-

0

0

301

206

(Reference)

NOI Yield (Note 5)

Proceeds from Amortization of Leasehold andSecurity (thousand yen)

(Note 1) Sompo Risk Care Management Inc. has prepared the PML for the 26th fiscal period. The figures entered for PML are the figures in the Portfolio Earthquake PML Assessment Report (December 2018).
(Note 2) For profits from property-related activities, actual results are used and displayed by rounding down to the nearest thousand yen.
(Note 3) Other Revenues includes Proceeds for Restoration and Repair Work or Proceeds from Amortization of Leasehold and Security De posits.
(Note 4) (3) NOI in this table is calculated by adjusting the Tax and Public Due for the “NOI (after deduction of gain on sale)”aforementioned in the Appendix “Major Financial Data” so the figures do not match.
(Note 5) NOI Yield is calculated by dividing annualized NOI in (3) on the table by the book value at the end of fiscal period (weighted average of book value at the beginning of fiscal period and the book value at the end of fiscal period for Shinjuku
Maynds Tower in the 25th fiscal period, and weighted average of book value at the end of October 2018 and book value at the e nd of fiscal period for Prime Kanda Building in the 26th fiscal period).
(Note 6) Properties sold in 25th FP.
(Note 7) Annualized NOI and NOI yield for the 25th fiscal period do not include 3/7 of co-ownership interest in Shinjuku Maynds Tower and Daiwa Meieiki Building sold in the 25th fiscal period. The portfolio total of (2) Property-related Expenses in thetable does not include expenses related to the Investment Corporation.

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

68

Overview of Asset Management Company (1)Company Overview

Directors(As of January 1, 2019)

Company Name

Daiwa Real Estate Asset Management Co., Ltd.

Address

6-2-1 Ginza, Chuo-ku, Tokyo

Established

October 21, 2004

Paid-in Capital

200 million yen

Representative Director

Akira Yamanouchi

Board of Directors

Executive directors: 5
Executive auditors: 1
10
Non-executive directors: 2
Non-executive auditors: 2

No. of Employees

108 (excluding dispatched employees)

Registered Financial
Instruments Firm

Registration No. 355 (Financial Instruments),
Director-General, Kanto Local Finance Bureau(Kinsho)

Building Lots and Buildings
Transaction Business License

License No. (3)-83920, Governor of Tokyo

Discretionary Agent for Real
Estate Transaction Approval

License No. 34, Minister of Land, Infrastructure,
Transport and Tourism

Association Membership

Member of The Investment Trusts Association,
Japan
Member of Japan Investment Advisers
Association
Member of Type II Financial Instruments Firms
Association(As of January 1, 2019)
President and Representative Director

Akira Yamanouchi

Vice President and Representative Director

Yuji Shinotsuka

Vice President and Representative Director

Yoshiki Nishigaki

Executive Managing Director

Toshio Fukushima

Director

Hajime Imbe

Director (non-executive)

Mikita Komatsu

Director (non-executive)

Keiichi Ishikawa

AuditorTamaki Shibayama

Auditor (non-executive)

Morimasa Matsuda

Auditor (non-executive)

Shinji Kiso

REITs which Entrust Asset Management
to the Asset Management Company(As of January 1, 2019)
Daiwa Office
Investment
Corporation

Listed REIT focusing on office buildings
Asset size: approximately 462.7 billion yen (59 properties)

Japan Rental
Housing
Investments Inc.

Listed REIT focusing on residential properties
Asset size: approximately 225.5 billion yen (198 properties)

Daiwa Residential
Private Investment
Corporation

Unlisted REIT focusing on residential properties
Asset size: approximately 110.0 billion yen (71 properties)

Nippon Healthcare
Investment
Corporation

Japan’s first listed REIT focusing on healthcare facilities
Asset size: approximately 19.7 billion yen (23 properties)

Daiwa Hotel Private
Investment
Corporation

Private REIT focusing on hotels
Asset size: approximately 9.2 billion yen (3 properties)

This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

69

Overview of Asset Management Company (2)Organization Chart
Shareholders’ Meeting
Corporate Auditors
Board of Directors
Compliance Committee

Compliance Officer
Investment Committee(*)* Set up separately for each
investment corporation

President and Representative
Director

Internal Control OfficeAcquisition and AssetManagement Division

Acquisition
Department

Origination
Department

Asset
Management
Department

Private Fund Division

JRH Asset
Management
Dept.

Private FundManagement
Department

Corporate Division

Customer
Relations
Department

Finance
Department

Office Investment
Team

Office ManagementTeam

AM TeamFinance Team

Residential
Investment Team

Residential
Management Team

Portfolio System
Team

Accounting
Team

Healthcare
Investment Team

Healthcare
Management Team

Hotel Investment
Team

Hotel ManagementTeam

JRH Investment
Team

Investment
Planning Team
Construction
Management Team

Administration
Department

Corporate
Planning
Department

Compliance &RiskManagement
Dept.

Management
Team(As of January 1, 2019)
This document is not material disclosed in compliance with the Financial Instruments and Exchange Law or any regulation of similar nature, nor is it
intended for the purposes of solicitation. Daiwa Office Investment Corporation advises readers to make investment decisions at their own judgment.

70