33rd Fiscal Period
Securities code 8955

Presentation Material
For the 33rd Fiscal Period Ended June 2018
August 20, 2018

(Asset Manager)
Tokyo Realty Investment Management, Inc.

Table of Contents and Disclaimer

Disclaimer

Table and Contents
1. Characteristics of JPR

2p

2. Operational Status and Growth Strategy

4p2-1. Summary of Financial Results

5p2-2. Internal Growth Strategy

7p2-3. External Growth Strategy

15p

2-4. Financial Strategy

18p

2-5. Sustainability

19P

3. Financial Results and Operating Forecasts

24p

4. Appendix

34p

5. Glossary

56p(Asset Manager)Tokyo Realty Investment Management, Inc.
Financial Instruments Exchanger (investment management business)
Registration Number: No.362 (Kinsho) Head of Kanto Local Finance Bureau• This material contains information that constitutes forward-looking
statements. Such forward-looking statements are made by Japan Prime
Realty Investment Corporation (JPR) and Tokyo Realty Investment
Management, Inc. (TRIM) based on information currently available, and are
therefore not guarantees of future performance. Actual results may differ
materially from those in the forward-looking statements as a result ofvarious factors including known or unknown risks and uncertainties.
• This material is solely for the purpose of providing information, and is notintended for the purpose of offering or soliciting investment, or as a meansof marketing activities. Please refer any inquiries for possible purchase ofinvestment units or investment corporation bonds of JPR to your securities
companies.
• Although JPR takes all possible measures to ensure the accuracy of thecontent provided in this material (including references to legislation andtaxation), it makes no guarantee as to the accuracy or reliability of thecontent. Furthermore, the content may be subject to change without priornotice.
• The photos used in this material include those of the assets other than what
JPR owns or plans to acquire. Please note that for assets indicated as landwith leasehold interest, JPR owns only the land and does not own any
building on it.
• Unless otherwise noted, the figures indicated in this material are rounded
down to the nearest specified unit for monetary amounts and space areas,
and rounded off to the nearest specified unit for percentages and otherfigures. Accordingly, the sum totals of monetary amounts or percentages ofrespective items may not match the sum totals of actual figures.

Cover photograph：Tokyo Square Garden

1

JAPAN PRIME REALTY INVESTMENT CORPORATION

1. Characteristics of JPR

2

1. Characteristics of JPR

A J-REIT listed in 2002 and managing a combined portfolio with office properties and urban
retail properties as investment targets■Overview of JPR
Name

Japan Prime Realty Investment Corporation(abbreviated as JPR)

Securities code

8955

Listing dateJune 14, 2002 (16 years since listing)End of fiscal
periodOperational
standard of
portfolio(Target investment
ratio)

Asset Manager

Sponsors(shareholding
ratio)

June and December(Ratio by asset class)
Office 70～90% / Retail 10～30%(Ratio by area)
Tokyo 80～90% / Other cities 10～20%

Tokyo Realty Investment Management Inc.
(abbreviated as TRIM)
Tokyo Tatemono (52%)
Yasuda Real Estate (18%)
Taisei Corporation (10%)
Sompo Japan Nipponkoa Insurance (10%)
Meiji Yasuda Life Insurance (10%)■Characteristics of JPR
track record of stable management for over 16
1 Ayears
Since listing, JPR has steadily expanded its asset size while enhancing the qualityof its portfolio.

2 A portfolio focused on office properties in Tokyo
JPR has established a portfolio that is focused on office properties in Tokyo,
which feature growth potential, with urban retail properties and office properties
in regional cities to complement profitability.

3 Superiority of a developer-sponsored REIT

JPR has exerted its superiority of a developer-sponsored REIT to acquire
properties having excellent location characteristics centering on large-scale
development projects.

internal growth through high occupancy
4 Continuous
rate and upward revision of rents
The average occupancy rate of the entire portfolio has stayed at 97% or higher
since the 26th fiscal period ended December 2014, and upward revision of rents
continued to surpass downward revision by value for 8 straight fiscal periods.

Asset size
(After the asset replacement)

62 properties 435.0 bn. yen
Ratio by asset(After the asset replacement)(Area)

Tokyo(Asset class)

Office(planned) acquisition price and ratio
of properties from sponsor pipelines(After the asset replacement)

315.4 bn. yen・ 72.5 %Upward revision of rents

8 consecutive fiscal
periods(Dec. ’14 ～ June. ’18)

of a financial base that is stable over
5 Establishment
the long termWith a credit rating of AA- (Stable), JPR has established a financial base centeringon long-term, fixed-interest rate debts with a focus on stability.

84.5 %
76.8 %

LTV

40.6 %
Ratio of long-term, fixed interest rate debts

100.0%
Credit rating

1. The indicated figures are as of the date of this document. For Asset size, Investment ratios and (Planned) acquisition price and ratio of properties
from sponsor pipelines, the indicated figures are those after the Asset Replacement is completed.
2. Properties from sponsor pipelines refer to properties acquired from sponsors, etc. and properties acquired based on information provided bysponsors. Sponsors, etc. represent the five sponsor companies of JPR, their affiliated companies and special purpose companies (SPCs) in which thesponsors have made equity investment. Ratio of properties from sponsor pipelines refers to the ratio of (planned) acquisition price of properties
from sponsor pipelines over the total (planned) acquisition price of the entire portfolio.

AA- (stable)
S&P A (stable)
R&I

3

JAPAN PRIME REALTY INVESTMENT CORPORATION

2. Operational Status and Growth Strategy

42-1. Summary of Financial Results

DPU and NAV from the 33rd Fiscal Period (Jun. ‘18) Financial Results

Distribution per unit (DPU) and NAV per unit have continued to increase stably over a long periodof timeDPU 7,245 yen

NAV per Unit 329,845 yen

Continuing a record high since listing
Compared with forecast at beginning of period +25 yen
Period-on-period comparison +22 yen / +0.3 %Period-on-period increase in NAV per unit for 10
consecutive fiscal periods since Jun. ‘13
Period-on-period comparison+9,785 yen / +3.1 %(Forecast DPU：7,220 yen)

DPU (actual)

DPU (compared with forecast)

NAV per unit

329,845(yen/unit)(yen/unit)

320,060

7,245
7,048

7,000

6,351 6,419
6,031
6,000

6,006

6,588

7,213 7,223

306,192
300,000

6,756

6,150

250,000

283,129
273,915
263,026
251,804
230,437
220,672
215,648
207,597

200,000

5,000

4,0000Jun. '13 Dec. '13 Jun. '14 Dec. '14 Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 (period)

150,0000
Jun. '13 Dec. '13 Jun. '14 Dec. '14 Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 (period)52-1. Summary of Financial Results

Business Environment Perception, results and outlook

With plans for the 33rd fiscal period ended Jun. 2018 progressing steadily, JPR continued toachieve stable growth by securing higher DPU than in the previous period.
Emphasis was placed on “continuation of contract renewals with upward revision of rents,” “measures to increase NOI,” “continuous external growth” and “stable fundprocurement.”

Outlook

Results

Business
environment
perception

Internal Growth Strategy• Office demand from companies is still robust.
• Leasing of large-scale office properties scheduled forcompletion by 2019 in Central Tokyo appears to be
progressing steadily• With vacancy rates on a downward trend nationwide,
rents are also continuing an upward trend

External Growth Strategy• Real estate prices in Central Tokyo have mostly reachedthe upper limit• Properties in regional cities are also hard to acquire at
appropriate prices, with their cap rates dropping further• Occupancy rate based on conclude contracts
98.2%(previous period 98.4%)• Upward revision upon contract renewal (monthly rent,net)+20.1 million yen• Raising of rents upon tenant replacement (monthly rent,net)+4.3 million yen• While the occupancy rate declined slightly in the Jun. ‘18
period due to the concentration of move-outs, it isexpected to recover in the Dec. ’18 period.
• The revision of rents made progress as planned.

• Not much information was available in the for-sale realestate market on properties that suit JPR’s acquisition
criteria• Despite collecting and investigating property informationfrom the sponsors and through proprietary channels likeclose business connections, no acquisition was closed andcompleted• The favorable market environment is assumed to continue.

• Continue vigorously selective investments in officeproperties in Tokyo and urban retail properties, with afocus on their location and quality.
• With the number of properties in the sponsors’ pipelines
steadily increasing, discussions on acquisition will be madeafter discerning the occupancy status, etc. of theproperties• Revise the space standards for investment targets in July.
• Also investigate the addition of asset types.

• The high occupancy rate is expected to be maintained, andthe revision of rents is assumed to make steady progress.
• Endeavor to reduce costs amid concerns about rising
management costs associated with increasing personnel
expenses, in addition to the rising cost of holding
properties.

Financial Strategy• The Bank of Japan (BOJ) continues its monetary easing
measures amid continuous cutbacks of monetary easing
schemes in the U.S. and Europe• While the long-term interest rate rose slightly due to therevision of the monetary policy by the Bank of Japan (BOJ)
in July, interest rates are expected to remain stable under
the control of BOJ.

【Debt procurement result in the 33rd fiscal period (Jun. ’18)】• Average maturity(Before refinancing) 5.5 years ⇒ (After refinancing) 7.6
years• Average debt interest rate
(Before refinancing) 0.99% ⇒ (After refinancing) 0.57%• Number of lender 29 institutions ⇒ 30 institutions• 10-year investment corporation bonds of 3 billion yen
were issued for the first time in three and a half years.

• Focus on refinances with an emphasis on flattening of
repayment amount of each fiscal period and lengthening
the maturity of debts• Expand the scope of financial institutions to deal with
• Enhance refinance risk tolerance by expanding liquidity on
hand and other measures6

2-2. Internal Growth Strategy

Occupancy Status

Move-outs were concentrated in the Jun. ’18 period, but the early leasing up of vacancies has
been achieved.
Occupancy rate based on generated rents are expected to remain stable at a high level in and after
the Dec. ’18 period.
■ Move-Ins/Move-Outs■ Occupancy Rate
Occupancy rate based on concluded cntracts
Occupancy rate based on generated rents

(%)

100

97.5

98

97.4

97.8

98.3

97.3
96

98.5

98.4

98.3

98.1

End of Dec. ’17 period
Jun. ‘18
Dec. ‘18
End of Dec. ’18 period
VacancyspaceMove-in/move-out net space Move-in/move-out net space assumed vacancy space

6,982㎡

96.9

96.5
95.7

98.9

98.2

97.9

97.6

99.0

• Far more move-outs than the average for the most recent five periods
occurred in the Jun. ’18 period, but the early leasing up of vacancies has beenachieved.
• In the Dec. ’18 period, more move-ins than move-outs have been secured as ofnow.
(Change in move-in/ move-out spaces and forecast)

95.2

Move-out(period)

Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 (period)(forecast)(forecast)'18.12(forecast)

The most recent
5-period average
10,716㎡(period)
Major Move-out
Jun. ’18 Olinas Tower■ Average rent free period

Yakuin Business Garden
JPR Ueno East Bldg.
Gotanda First Bldg.
Tokyo Tatemono Yokohama
Bldg.

(month)

6
3
0

2.3

2.4

5,310㎡

1.9

1.8

2.0

Kawasaki DICE Bldg.

1.5

Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 (period)(forecast)

1. Occupancy rate based on concluded contracts and occupancy rate based on generated rents represent period-average figures.
2. The figures for the occupancy rate based on concluded contracts and the occupancy rate based on generated rents for the 34th fiscal period (Dec. ‘18)
are estimates that reflect consents regarding move-ins and move-outs that will become effective in the fiscal period. The respective figures for the 35th
fiscal period (Jun. ‘19) are estimates based on assumptions by JPR regarding move-ins and move-outs becoming effective in the fiscal period.

Dec. ’18

Move-in

18,773

'18.6

3.4

-524㎡

(Move-in/ move-out spaces and major move-in/move-out properties

94

920

-1,143㎡(㎡)

19,916The most recent
5-period average
10,776㎡

4,206 4,730

Major Move-in
4,185㎡
3,429㎡
2,359㎡
1,179㎡
1,096㎡
1,592㎡

Olinas Tower
Yakuin Business Garden
JPR Ueno East Bldg.
Gotanda First Bldg.
Tokyo Tatemono Yokohama
Bldg.
Tokyo Tatemono Honmachi
Bldg.

3,850㎡
3,521㎡
2,337㎡
1,179㎡
797㎡
2,100㎡

JPR Shinsaibasi Bldg.

1,670㎡

Kawasaki DICE Bldg.

1,592㎡(forecast)7

2-2. Internal Growth Strategy

Status of Rent

With steady progress made in upward revision of rents and raising of rents upon tenant
replacement, office rents continued to increase■ Rent Revisions■ Status of Rent Levels by Fiscal Period with Contract Renewal (office properties)

Upward revision amount ofmonthly rent

+23.2 million yen

+7.6%

34.0

32.7

44.6

36.7

45.9
Upward revision
undernegotiation: 2.3
million yen

+23.2

+10
+10.4

+10.9

+14.6

-0.4

-2.8

-5.8

+10.0
-3.9

(%)

+5.2
-0.2

-3.0

-10

50
25

Dec. '16

Jun. '17

Dec. '17

Jun. '18

Dec. '18 (period)■ Rent upon Tenant Replacement (increase/decrease of rent through tenant replacement)
Jun. ’18+9.0 million yen

Ratio of tenant replacement withincreased rent

70.6

61.0%

+16.0%(compared with the number of tenant replacement)(compared with rent including common charges)

81.8

71.0

67.6

+10

+0

Rate of increase inrent upon tenant replacement

Downward revision
Upward revision
Ratio of tenant replacement with increased rent (right axis)(million yen)

61.0

Expected net
increase: 1.2
million yen

(%)

100
50

+4.5

-0.9

+5.1

-0.3

+4.7

-1.3

+3.7

-1.0

-4.7

-10
Jun. '16

Dec. '16

Jun. '17

Dec. '17

+5.9

+9.0

Jun. '18-0.1

1. Figures in “Rent Revisions” are values excluding the land rent of the Otemachi Tower (Land with Leasehold Interest).

3.3%

+15

56.6%

-15

(50)

-3.2%

73.8%

(Dec. 2018 ～ Jun. 2020)-30(Reference)
Gap in actual rents

7.5

- %
(Dec. 2018 ～ Jun. 2020)-45
Jun. '18

Dec. '18 Jun. '19 Dec. '19 Jun. '20(period)

1. “Gap in rents” refers to the difference between the base rent and the ongoing rent, and “Gap in actual rents” refers to the difference between
the target rent and the ongoing rent.
2. “Gap in rents” in the Jun. ’18 period is the gap in rents of contracts that were scheduled to be renewed in the Jun. ‘18 period as of the end of
the Dec. ’17 period.

◼ Percentages of spaceof change in upward revisionby the time of contract renewal ◼ Ratio(Jun. ‘18)
Dec. ‘20 fiscal Dec. ’18 fiscal
periodperiod later

14%

0

(100)
Dec. '18 (period)(forecast)+30

Gap in rents(forecast)

Increase in monthly rent upontenant replacement(million yen)

Lower than base rent
Higher than target rent （except for new contract）
Higher than target rent （new contract, etc.）
Higher than base rent and lower than target rent
Percentages show ratios of the number of increased rents.

+0

0

(25)
Jun. '16

+45
基
準
賃
料
以
上

Higher than target
rent

+30

+0

46.9%

(compared with the number of contract renewal) (compared with rent including common charges)

Downward revision
Upward revision
Ratio of contracts with upward revision (right axis)(million yen)

+20

Rate of upward revision

Lower than target rent

Jun. ’18

Ratio of contracts withupward revisionJun. ’20 fiscal
period33%

Three times
6%

12%

Jun. ’19 fiscal
period

22%

Twice
31%

Once
63%

Dec. ’19 fiscal
period19%8

2-2. Internal Growth Strategy

Status of Rent

Rent levels rose in all areas including Central Tokyo with large supply.
■ Increase/ Decrease of Monthly Contract Rents■ Status of Average Rent (existing office properties, all area)(yen/tsubo)

Monthly contract rent (end of Dec. ‘17 fiscal period)

2,119 million yen

18,000

Ratio by period-on-period

17,000

+0.6%

+0.8%

+1.0%

+0.4%

+1.7%

+0.1%

Dec. '15

Jun. '16

Dec. '16

Jun. '17

Dec. '17

Jun. '18 (period)

16,00015,000Rent revisions +19 million yen +0.9 %Breakdown ： Increase +22 Decrease -3+29 million yen+1.4 %

14,000Jun. '15■ Change in Average Rents by Area (existing office properties)
Central Tokyo(yen/tsubo)

21,000

Breakdown ： Move-in +112 Move-out -102

Other cities

Ratio by period-on-period+0.3%

Move –in/ move-out +10 million yen +0.5 %Greater Tokyo

+1.1%

+0.9%

+1.5%

+0.3%

+1.0%

-0.3%

+0.1%

+0.6%

+0.3%

+1.4%

+2.1%

+0.5%

+0.8%

19,00017,000-0.2%

15,000Monthly contract rent (end of Jun. ’18 fiscal period)

13,0002,148 million yen

11,000

+4.7%
-0.2%

1. Figures in “Increase/Decease of Monthly Contract Rents” are values excluding the land rent of the Otemachi Tower (Land with Leasehold Interest).

+0.8%

Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 (period)
1. “Existing office properties” refer to properties held continuously since the Jun. ‘15 period.
2. Average rent indicates the assumed average rent at full occupancy.

92-2. Internal Growth Strategy

Internal Growth Initiatives

On top of measures to achieve continuous raising of rents, energetically endeavor to increaseother revenues and reduce expenses■ Example of construction works for value enhancement in
the 33rd fiscal period (Tokyo Tatemono Yokohama Bldg.)
Set target rents, the target for raising rents for new contracts andcontract renewals, for respective office properties. By clarifying thetarget, aim to conduct strategic negotiations for raising rents andmaximizing rents upon tenant replacement

Strategically utilize target

1. rents

Reinforce investments for2. value enhancement

Deliberately responding to tenants and creating safe and secured
environments are important initiatives that positively affect rent
negotiations as well as help prevent contract cancellations fromhappening

Increase NOI by reviewing

4. property management andAfter work

Review property management and operation methods while paying
attention to maintaining and improving the management quality, inan effort to promote reduction of rental expenses and increasing
incidental revenues

ToiletContinuously enhance

3. tenant satisfaction

operation methods

In addition to reinforcing property competitiveness, proactively invest
in interior fittings and facilities, etc. that meets tenant needs, with anintention to raise rents for new contracts

Before work

Elevator hall

■ Basic Strategy■ Initiatives for Increasing NOI• Reduction of power charges
Conducted bidding by several power providers to switch power supply contracts
Reductions in power
charges (annual
estimate)

Effect of
reductions(annual estimate)

Conducted in the Dec. ’17
period - Jun. ’18 period

27 properties

Approx. 63 million yen-9.7 %To be conducted in the
Dec. ’18 period

10 properties

Approx. 39 million yen-15.1 %

• Took measures to increase earnings, including promoting the effective use ofcommon-use spaces.
1. The reduction amount indicates the difference the past results of power use at the subject buildings and the estimated amount after switching
power providers based on the past results
2. The reduction of power charges to be made in the Dec. ’18 period is not included in the forecasts of financial results in this material.

■ Effective use of common-use spaces (JPR Harajuku Bldg.)
Setting sign board

Subject
properties102-2. Internal Growth Strategy

Status of Construction Works

JPR maintained and enhanced property competitiveness through continuous maintenance
operations based on appropriate repair plans as well as through investments for valueenhancement■ Summary of Construction Works in the 33rd Fiscal Period (Jun. ‘18)

■ Changes in Construction Costs and Depreciation• Total construction costs
Depreciation

Capital expenditures(million yen)

2,000

1,885

1,884

1,921

1,907

⇒Of which, works for value enhancement

Repairs and maintenance
修繕費
1,943

1,952

⇒Of which, works to switch to LED lamp, etc.

1,984

1,882

1,530 million yen
863 million yen
343 million yen◼

Tokyo Tatemono Honmachi Bldg. (297 million yen ＲＮ・air
condition, etc.)◼

JPR Shinsaibashi Bldg.
(138 million yen the expansion of floor space, etc.)◼

Kawaguchi Center Bldg. (236 million yen air condition, etc.)◼

Olinas Tower (82 million yen ＬＥＤ, etc.)

1,697

1,500

■ Summary of Construction Works (planned) in the 34th Fiscal Period (Dec. ’18)

1,146

1,000

772

500

724

387

624

563

352

306

Jun. '17

Dec. '17◼

Tokyo Tatemono Honmachi Bldg. (135 million yen ＲＮ・ＬＥＤ,
etc.)

◼

0
Dec. '16

Kawaguchi Center Bldg. (214 million yen air condition, etc.)

Jun. '18◼

Shinjuku Center Bldg. (125 million yen air condition・ＥＳＬ,
etc.)

◼

Kawasaki DICE Bldg. (116 million yen ＲＮ・air condition, etc.)

363

216

Jun. '16

Tokyo Tatemono Yokohama Bldg. (370 million yen ＲＮ・ＥＶ, etc.)◼

■ Summary of Construction Works (planned) in the 35th Fiscal Period (Jun. ’19)

471
383

◼

Dec. '18

Jun. '19 (period)(forecast)(forecast)

Kanematsu Bldg. (211 million yen toilet・ＬＥＤ, etc.)◼
Tokyo Tatemono Honmachi Bldg. (197 million yen air condition, 
etc.)



Olinas Tower (189 million yen air condition, etc.)

Kawaguchi Center Bldg. (183 million yen air condition, etc.)
MS Shibaura Bldg.
(138 million yen emergency power source, etc.)◼ Work for value enhancement, etc.  Work for other

1. Repairs and maintenance expenses indicate the amount obtained by deducting the repairs and maintenance expenses equivalent to the expenses for restoration to original condition, paid by tenants, from the amount actually recorded for each fiscal period.
2. RN, EV and ESL represent “renovation,” “work on elevators” and “work on escalator”, respectively.
3. Each of the construction costs indicates the amount that includes construction management fees.
4. Construction works (planned) are extracts from long-term plans and do not guarantee implementation.

11

2-2. Internal Growth Strategy

Portfolio Strategy

Amid office supply centered on very large properties in Central Tokyo in recent years, JPR is building aportfolio centered on large and medium-sized office properties.
■Ratio by Asset Size (Office properties)■Office Supply (Increase in Leasable Floor in Tokyo’s Five Central Wards)

Extra-large

1. Ratio by Size (Office properties) indicates the ratios based on the total leased space of office properties in each size
category, which is classified by the total leasable space of an entire office property. Furthermore, The Otemachi Tower(Land with Leasehold Interest) is excluded from the calculation as it is a land property.

■Ratio by Rent Zone (Central Tokyo, Greater Tokyo)
Less than 15
thousand yen

2.2%
15 to less than
20 thousand yen

52.7%

330 thousand yen or more
Of 19.3%, Tokyo Square Garden accounts for
7.7%.

19.3%

25 to less than 30
thousand yen

7.1%
20 to less than
20 thousand yen

Less than 30 thousand yen

80.7%

18.8%

500

0

500

1,000

1. Prepared by TRIM based on market research agency.
2. The figures indicate the sum total of the increase in leasable floor, caused by the supply of newly-built
office properties, for each year.

■Changes in the average rent of the 23 wards of Tokyo
Very large(yen/tsubo)

Large

Medium-sized

45,00035,00025,00015,0005,000

1. Ratio of JPR office properties by rent level refers to the ratio of acquisition price, by average unit rent (includingcommon charges) zone, against the total acquisition price of office properties JPR owns in Central Tokyo andGreater Tokyo.

(thousand ㎡)

1,000

Mar.
'18

89.1%

Mar.
'17

If Other very large is included,

Mar.
'16

33.4%

4.48
million ㎡

Mar.
'15

68.7%

(10 thousand m2 to lessthan 30 thousand m2)

1.09
million ㎡

Mar.
'14

Large

Large and medium-sized

Mar.
'13

20.4%

Mar.
'12

35.3%

Mar.
'11

(30 thousand m2 or
more over)

2012
2013
2014
2015
2016
2017
2018 (forecast)2019 (forecast)2020 (forecast)

Mar.
'10

Other very large

Mar.
'09

Medium-sized(3 thousand m2 to lessthan 10 thousand m2)(year)

Mar.
'08

11.0%

Very large(30,000m2 or more)

Large and medium-sized(less than 30,000m2)

Mar.
'07

(Tokyo CBDs and 60
thousand m2 or more over)(month,year)

1．Prepared by TRIM based on the statistics data publicized by Sanko Estate Co., Ltd. and NLI Research Institute.

12

2-2. Internal Growth Strategy

Retail Portfolio

JPR’s retail properties are situated in prime locations or in areas close tostations and with high commercial potential
The 14 properties comprising the retail portfolio are all located within a 5-minute walk from thenearest station
Portfolio breakdown

Type

Urban type

Characteristics

Urban retail properties situated on prime locations in Tokyo and Osaka
6物件

NOI yield

4.1%(acquisition price)

Station-front type
Retail properties located in front of stations near Tokyo and in major regional
cities5.9%

8 properties / 54.76 billion yen (asset size)

JPR Ginza
Namiki-dori
Bldg.

JPR
Chayamachi
Bldg.

JPR Shibuya
Tower Records Bldg.

JPR Jingumae 432

Shinjuku
Sanchome
East Bldg.

FUNDES
Suidobashi

Yurakucho
Ekimae Bldg.
( Yurakucho Itocia)

JPR Umeda Loft Bldg.

6 properties / 46.18 billion yen (asset size)

Urban type8 properties

57%

Retail14 properties

Station-front
type
6 properties

Tanashi ASTA

Kawasaki Dice Bldg.

JPR
Musashikosugi
Bldg.

Musashiurawa Shopping
SquareCupo-la Main Bldg.

Housing Design
Center Kobe

43%

13

2-2. Internal Growth Strategy

Status of Occupancy Rate and Lease Contract in Retail properties

The occupancy rate of JPR’s retail properties remains stable at almost fulloccupancy.
■ Commercial Potential of Station-Front Type properties■ Occupancy Rate (Retail properties)
(%)

100.0

100.0

99.9

99.9

99.9

100.0
99.9

100.0
99.9

99.7
99.6

98.0
96.0
94.0
0

100.0

99.4

99.5

99.2

100.0
99.8

Occupancy rate based on concluded cntracts
Occupancy rate based on generated rents
Dec. '15

Jun. '16

Dec. '16

Jun. '17

Dec. '17

Jun. '18

Dec. '18

Jun. '19(period)(forecast)(forecast)(10 thousand)

24.0

78%

Fixed rent
95%Type of contract (space ratio)

Remaining contract period(space ratio)

89%

Total floor space/ Building
ownership ratio

18,394㎡ / 100.0%

'13

'14

'15

'16

Tanashi ASTA

5%

Ordinary building lease2-minute walk from Musashikosugi Station on
the Tokyu Toyoko Line
7-minute walk from Musashikosugi Station on
the JR Line

Average number of passengers getting on and off
trains per day by fiscal year (Musashikosugi Station)

Multi tenants
22%

5 years
or more40%

2 years or more andless than 3 years
8%
3 years or more andless than 5 years
25%

Acquisition and date

10,200 million yen / Nov. 2001

Nearest station

Proximity from Tanasi Station on the Seibu
Shinjuku Line

Total floor space

件数比80,675㎡

Building ownership ratio

52.9%• Area with one of the largest numbers of passengers along the line and an increasing population
at a high rate.
• One of the largest properties in the area with a store floor area of more than 9,000 tsubo, while it
is in close proximity to the station.
(10 thousand)Less than
2 years
27%

Nearest station

20.0

Fixed rent + Commission

Fixed-termbuilding lease11%

7,254 million yen / Sep. 2006

22.0

Type of rent (space ratio)

Entire building

Acquisition and date

• Further potential is expected given increased activity and convenience because the number ofpassengers is increasing year by year and the development of tower condominiums and theopening of a new station on the JR Yokosuka Line will occur one after another.

■ Status of Lease Contract (Retail properties)
Type of tenant (space ratio)

JPR Musashikosugi Bldg.

7.6

Average number of passengers getting on and off
trains per day by fiscal year (Tanashi Station)

7.4
7.2
'14

'15

'16

'17

1. “Average number of passengers getting on and off trains per day by fiscal year” is prepared by TRIM based on the publisheddata of railway companies and the “prefecture handbook” of Kanagawa.

14

2-3.
Growth Strategy
2-2. External
内部成長戦略Investment Policy

Continue vigorously selective investments focusing on quality, mainly in office properties inTokyo.
Proceed with the review of investment space and add urban hotel property with the intentionof expanding acquisition opportunities.
■ Investment Strategy■ Basic Policy• Utilize the pipelines such as preferential negotiation rights heldby JPR and the sponsor to investigate acquisitions throughnegotiated deals.
• Investigate asset replacement that will contribute to theportfolio with the sponsor.

Investment Target

Basic
Operation(Asset)(Area)

Urban retailpropertyTokyo

70 ～ 90 %10 ～ 30 %80 ～ 90 %10 ～ 20 %(76.8 %)

(23.2 %)

(84.5 %)

(15.5 %)

OfficeOther cities

Figures in parentheses are investment ratios as of the date of this material.

■ Initiatives to expand acquisition opportunities• Ease space standards for investment targets (revision on July 1,
2018)
Change the standards so that investments in office properties ofless than a certain size (total floor area of 3,300m2 or more) will
become possible based on a comprehensive judgment of thelocation characteristics, the business categories of tenants andequipment specifications, etc., while maintaining the policy ofbuilding a portfolio centered on properties of a certain size.

• Investigate the addition of asset types (urban hotels, etc.)• Continue to build a portfolio centered on office properties in Tokyo
with excellent location characteristics that offer the prospect ofcompetitiveness.
• Promote initiatives to expand acquisition opportunities while
continuing vigorously selective investments focusing on quality.

■ Acquisition Capacity by Debt
LTV (based on total assets)

40.6%

Acquisition capacity(maximum LTV of 45%)35.8 billion yen

15

2-3.
Growth Strategy
2-2. External
内部成長戦略Investment Policy

Promote vigorously selective investments and asset replacement by utilizing the sponsor
pipelines and preferential negotiation rights.
■ Investigation of acquisitions through negotiated deals■ Continue External Growth by Utilizing Asset Replacement(Asset replacement policy)• Aim to build a strong and solid portfolio by promoting asset replacement.

Utilizing sponsor pipeline(Ratio of Properties by Property
Acquisition Channel)
Properties acquired
other than fromsponsors
119.6 billion yen
27.5%
Properties acquired
based on information
provided by sponsors
98.1 billion yen
22.6%

Properties
acquisition fromsponsors
217.3 billion yen
49.9%

JPR

Properties acquired
using sponsor pipelines

72.5%

Utilizing preferential negotiation right• Enhance the quality of the portfolio
and profitability through strategicalasset replacement.
• Rejuvenate the age and improve
profitability.
• When properties are sold to thesponsor, discussion on acquisition
after the properties are redevelopedby the sponsors is possible throughpreferential negotiations.
• Conduct vigorously selective
investment at assumed fair value.

Acquisition
JPR Ginza Namiki-dori Bldg. (101)FUNDES Suidobashi (32)Acquisition
Tokyo Square Tower (184)
Acquisition date: Feb. ’17 and Apr. ‘17100

Full ownership

Co-owned properties, etc.
(existing preferential
negotiation right)

21 properties 190.3 billion yen

9 properties 59.8 billion yen

Acquiring blue-chipproperties(Recent asset replacement record)
200

Co-owned properties(not preferential
Negotiation right)

Asset
replacement• Sponsors who are developers haveneeds to acquire properties to be redeveloped.
• The main sponsors support expansionof JPR as part of their strategy toreinforce the comprehensive
strengths of the groups and enhancetheir business portfolio.
• Further reinforcement of the sponsor
commitment to JPR’s growth strategy.

(100 million yen)

(Ratio of co-owned properties, etc.)

32 properties
184.8 billion yen

Sponsors

Strategically sale

Sale

Sale Bldg.
JPR Daikanyama
JPR Daikanyama(18) Bldg.(18)

0

+133

Sale
物件売却

+92

+92

-18

Fukuoka Bldg. (31)Fukuoka
Bldg.(31)JPR
Hakata-chuo
Bldg.
JPR Hakata-chou(19) Bldg.(19)

-50

44.0％
-100

'16.9
Sep.
‘16

'16.12
Dec.
‘16

'17.2
Feb.
‘17

1. Figures in parentheses indicate the acquisition price or the sale price.

'17.4
Apr.
‘17

'17.4
Apr.
‘17

(year, month)16

2-3. External Growth Strategy

Urban Development by the Main Sponsor

Urban development business of the main sponsor◼ Examples of development projects by Tokyo Tatemono Co., Ltd.
Large-scale redevelopment projects
Owned by JPR(land with leasehold interest)

Owned by JPR

Urban compact retail properties (FUNDES series)
Total floorarea (㎡)Completion/p
lannedcompletion

FUNDES Suidobashi(Owned by JPR)

1,477

2015/7FUNDES Jinbocho

1,348

2016/11FUNDES Ueno

2,249

2017/7TENJIN249

999

2018/7(Tentative name)
FUNDES Gotanda

Unfixed2019/7(Tentative name)
FUNDES Ginza

Unfixed2019/10

Property name

Owned by JPR

FUNDES Suidobashi

FUNDES Ueno

Urban hotels
Tokyo Square Garden

Hotel name

Total floorarea (㎡)

guestroom

Owned by JPR

Owned by JPR

Candeo Hotels Tokyo Roppongi

4,700

149

2017/9The Square Hotel Ginza

5,700

182

2018/8(Tentative name) Hotel Gracery
Asakusa

3,700

125

2018/9(Tentative name) The b Osaka
Shinsaibashi

10,700309

2019/2(Tentative name) Candeo Hotels
Omiya

10,110321

2019/8(Name to be determined) Kyoto
Shijo

UnfixedUnfixedSummer 2020

(Name to be determined)Kyoto
Sanjo

UnfixedUnfixedUnfixedShinjuku Center Bldg.

Olinas Tower

No.

Completion/pla
nnedcompletion

The Otemachi Tower

1. For the properties shown in this slide other than those that are already owned by JPR, no specific negotiations for acquisition are underway with Tokyo Tatemono and JPR has no plans to acquire any of them at present.

Candeo Hotels
Tokyo Roppongi172-4. Financial Strategy

Fund Procurement Status and Outlook

Flatten repayment amount for each fiscal period and reduce debt costs■ Debt Procurement Results in the 33rd Fiscal Period (13.2 billion yen)

Commitment line 24.0 bn. yen

0.57%

200

(Jun. ’18 Actual bond issuance)■ Financial Indicators and Credit Rating Status(-0.43%pt)+0.04%pt

181.1 bn. yen-0.1 bn. yen

181.2 bn. yen
4.6 years

4.6 years±0.0 years

Average debt cost

0.96%

0.94%

-0.02% pt

Ratio of long-term, fixed interest
rate debts

100%

100%

±0% pt

42

20

40

30

30
(period)■ Average Interest on Debt for Last Three Fiscal Periods and Average
Cost of Debts To be Matured
1.80%

1.04%

0.87%

0.96%

Dec. '19

Jun. '20

Dec. '20(period)

0.97%

0.51%
The average interest rate on borrowings
直近3期平均for thelast three fiscal periods

Dec. '18

Jun. '19■ Average Maturity and Average Debt Cost

(LTV)
Acquisition capacity(maximum LTV of 45%)

85

90

Average debt cost to be repaid by fiscal period

Average maturity

LTV (based on total assets)

99

Jun. '28(-0.31%pt)

70

Dec. '27

0.57%

0

80

Jun. '27

0.61%-0.3 years

50

70

Dec. '26(+2.1 years)

40

80Jun. '26(+2.7 years)

50

40
100 110 98 100 105

Dec. '25

7.6 years

80

Jun. '25

7.9 years(Status of entire interest-bearing debts)
Total interest-bearing debts

91

81

30

20
20

Dec. '24-4.7 bn. Yen

20

Jun. '24

13.2 bn. yen

50

40
83

Dec. '23

17.9 bn. yen

100

Jun. '23

Average borrowing interest
rate (change)

ChangeJun. '19

Average maturity (change)

Jun. 2018

Dec. '18

New debt

Dec. 2017

Jun. '18(Status of Borrowings by Fiscal Period)(Jun. ’18 Actual debt)

Jun. '22

years-0.43% pt

Dec. '22

0.99%

After
refinancing

Dec. '21

7.6

Investment corporation bonds

新規借入（'18.6期）
New debt (Jun. '18)

Jun. '21+2.1 years

Beforerefinancing

300

Dec. '20

5.5 years

After
refinancing

Long-term loans payable

新規起債（'18.6期）
New bond (Jun. '18)

(100 mn. yen)Jun. '20

Beforerefinancing

Average debt interest rate

Dec. '19

Average maturity■ Lengthening of Maturity and Flattening of Repayment Amount for EachFiscal Period to Around 10 Billion Yen

40.6%
35.8 bn. yen

40.6%
35.8 bn. yen±0% pt±0 bn. yen

Average maturity(year)

8

1.44%

6

1.27%

1.21%

1.19%

1.16%

Average debt cost

1.11%

1.03%

0.96%

2.0%
1.5%
0.94%

4

(Credit rating)R&I

AA- (Stable)

2

S&P

Long-term: A (Stable), Short-term : A-1

0

1.0%
3.8

3.9

4.0

4.0

4.2

4.2

4.3

4.6

4.6

0.5%
0.0%

Jun. '14 Dec. '14 Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 (peri)d)18

Sustainability (promotion system ・ environmental certification)

2-5. Sustainability

Consistent Initiatives on Behalf of Sustainability■ Sustainability Promotion System■ Sustainability Policy
Based on its corporate philosophy of working with integrity and commitment to responsibilities, TRIM is resolved to contribute to
the sustainable development of society and the investment management business through discussion and cooperation with its
stakeholders (including investors and tenants), while aiming to maximize value for JPR's unitholders.

1.Initiatives on Behalf of Tenants
We will work with integrity and responsibility in responding to tenants, and endeavor to provide them with new and distinct
values as well as enhancing their satisfaction.

2.Initiatives on Behalf of the Environment
Recognizing the importance of addressing environmental issues, we will aim to reduce environmental load through managing
the assets owned by JPR.
・We will promote energy saving and reduction of greenhouse gas emissions.
・We will endeavor for effective use of water resources and work on the "3Rs" (reuse, reduce and recycle) of waste.
・We will strive to proactively disclose information on environmental issues.

3. Initiatives on Behalf of Local Communities

Established the Sustainability Committee with a view to sustainable growth.
•

Set goals and conduct monitoring and assessment for the purpose ofincreasing sustainability.

•

The members are the President and CEO (chairman), the general managers of
the Financial Division, the Investment Management Division, the Corporate
Planning/Administration Division and the Compliance Office and the Executive
Office.

•Meetings of the Executive Office are held monthly to report on progress interms of goals, collect information and work on educational activities in thecompany.

•

The Sustainability Committee is held twice or more each year and makes areport to TRIM’s board of directors and JPR’s board of directors once or moreeach year.

We will work to coordinate with local communities through managing the assets owned by JPR, in an effort to contribute toenhancing the brand value of the entire area in which such assets are located.

4. Initiatives on Behalf of the Employees
We will respect each one of our employees to realize an employee-friendly workplace, helping them to enhance abilities intheir specialties.

5. Initiatives on Behalf of the Society
We will abide by laws and regulations as well as the rules of society, and conduct business operations with a focus ontransparency and objectivity while holding on to our high moral standards.

■ DBJ Green Building■ GRESB

17 properties in total have been certified, representing 37.7% of the portfolio based onbook value
Tokyo Square Garden was granted a 5-starassessment in 2017

Acquisition of “Green Star,” the highest
ranking, for four consecutive years■ CASBEE Certification
Yakuin Business Garden was granted a Arank assessment in 2018

Properties with a 3-star assessment or more

Property nameTokyo Square Garden
Olinas Tower
Yakuin Business Garden
Shinagawa Canal Bldg.
JPR Sendagaya Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower
Tokyo Square Garden Omiya Prime East

Evaluation
★★★★★
★★★★
★★★★
★★★
★★★
★★★
★★★
★★★

Yakuin Business Garden

192-5. Sustainability

Sustainability (Environment)

Reinforcing Continuous Improvement Initiatives on Environmental Issues■ Construction Works for Reducing Environmental Load

■ Initiatives for battling the heat (Tokyo Square Garden)

Systematically implement refurbishment to highly energy-efficient facilities• Tokyo Square Garden has installed energy-saving cooling systems to reduce thesurrounding temperature by spraying mist.

Change in construction cost of ESG issue• It has also added heat-reducing materials to benches to ensure that they do nottransfer much heat.

LED construction
Work on air condition units(million yen)

400
300

339

• It has obtained a subsidy for a project to promote countermeasures against heatfrom the Tokyo metropolitan government on the grounds of creating coolingareas.

330

258
211

185

200

130

123

128

Dec. '17

Jun. '18

Dec. '18 (period)

100
0Jun. '17(forecast)

LED lamps were adopted at 14 properties (Jun. ’18)
Effect of adopting LED lamps (annual estimate)
BeforeAfter

Balance

Reduction
rate

Electricity use (kWh)890,218

430,774-459,443-51.6％

Power charge

14,576

7,086-7,490-51.4％

450.83219.94-231-51.2％

Item(thousand yen)

CO2 emissions (t-CO2)■ CO2 Emission Data
2016

2017

(fiscal year)(fiscal year)

Total (t-CO2)

52,95750,215-2,742

Intensity (t-CO2/m2)

0.084

0.078

-0.006

Item, units

CO2 emissions

Balance■ Cooperation with tenants
Introduction of green lease
Adopted a green lease clause in the basic contract in both operation and facility
renovation to contribute to the environment in cooperation with tenants.

■ Cooperation with PM and BMFormulation of a green procurement policy
JPR and TRIM have formulated a green procurement policy to focus on the
procurement of equipment in consideration of the environment, health andamenity, in addition to quality, price, delivery time and compliance with laws andregulations. They promote the policy in cooperation with PM and BM by
providing training for education.

20

2-5. Sustainability

Sustainability (society)

Initiatives for Enhancement of Tenant Satisfaction■ Initiatives on Behalf of Tenants■ Social Contribution and Disaster Drill

Periodical Tenant Satisfaction Surveys••

Overall satisfaction declined due to an increase in new subject properties.
At properties about which dissatisfaction was expressed, communication withtenants was promoted.
Change in tenant satisfaction survey results(number of property)
Number of subject property

50

3.1

3.2 3.2 3.2

3.3

3.2

(score)Overall satisfaction (average)

75

4.0

3.5
3.4 3.4 3.4 3.5
3.4 3.4
3.3

Initiative of Tokyo Square Garden

Morning Clean-up Activity

TRIM’s officers and employees participated as
carriers of Mikoshi at the festival in Kyobashi 3chome where the property is located. They
contributed to the invigoration of thecommunity with the local neighborhood
association.

Regularly conduct cleaning activity in the
Nihonbashi, Yaesu and Kyobashi areas with
Tokyo Tatemono. Take initiatives for achieving
interactions with the local people and making
contributions to local communities.

3.5
3.0

25
31

32

31

32

32

36

37

37

38

41

39

40

40

45

2.5
0
2.0

00
'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18(year)［Overview of the 2018 CS survey］
Average value with 4 points being the highest
Survey period: Apr.-Jun. 2018
Surveyed building: 45 building with 498 tenant
Questionnaire item: management and administration, responses to tenants, crime
prevention and safety, emergency responses and environmental preservation, etc.

Initiative of Olinas Tower

Disaster Drill

Held the Machikado Concert in the commonuse area by inviting the New Japan
Philharmonic headquartered in Sumida-ku.

TRIM undertakes an earthquake drill exercise
twice a year, in principle. It works to improve its
disaster response skills by dealing with issues at
the time of the exercise.

Inspection Flow Chart for CS
Tenant satisfaction survey and inspection
Conduct periodical questionnaires

TRIM brand study session
Verify the questionnaire results and check how
popular the brand has become

Improvement of management issues

Periodical liaison meeting

Improve problematic situations in cooperation
with property managers and building managers
of respective properties

Clarify managerial issues and discusscountermeasures among the asset manager,
property managers and building managers

212-5. Sustainability

Sustainability (corporate governance)

Endeavor to secure and enhance the soundness of business management as an investment
corporation and an asset management company that are reliable and trustworthy■ TRIM’s Corporate Governance■ JPR’s Corporate Governance
JPR’s decision-making organs

Decision-making process for property acquisitions

It is stipulated (Article 18 of the regulations) that JPR shall have up to two executive officers and up to
four supervising officers (there must be at least one more supervising officer than executive officers).

The following procedures are taken for cases of transactions with interested parties:• An outside attorney is appointed as a special member of the Compliance Committee and examines andverifies the adequacy and rationality of transactions at the Committee.
• Upon implementing the approved transactions, approval by JPR’s board of directors, comprising directors
who are independent from the shareholders of TRIM, must be obtained in advance.

Criteria for appointing investment corporation officers and remuneration

Decision-Making Based on Stringent Processes• Employing a management fee system that matches unitholder’s interests and benefits of theasset management company

Item

Calculation of Compensation

Acquisition

Remuneration System of the Asset Manager

Conclude agreement－

TRIM’s Board of Directors

16,200Investment Subcommittee－

Ernst & Young
ShinNihon LLC－

Final decision on
acquisition

Gyosei Certified Public Tax
Accountants' Co.
Group Representative Partner

4,200

Nobuhisa Kusanagi－

Compliance Committee
JPR’s Board of Directors

Partner Attorney, Spring Partners

1

Prior review /approval oftransaction withrelated parties

Masato Denawa

2,400

Due diligence
subcommittee

Tokyo Realty Investment
Management Inc.
DirectorDue diligence

Satoshi Okubo

Investment subcommittee

Independent
AuditorFee (Jun. ‘18) Owned
units(thousand yen)

Decision on
acquisition policy

Supervising
Officer

Other Current Assignments

Compliance subcommittee

Executive
Officer

Name

Review, screening

Position

Invest management department

None of the grounds for disqualification stipulated in the laws concerning investment trusts and investment
corporations
Officers are appointed by means of a resolution of the General Meeting of Unitholders.
The remuneration for executive officers and supervising officers is stipulated in the investment corporation
regulations as the amount decided by the Board of Directors (up to a maximum of 500,000 yen per month foreach executive officer and 400,000 yen per month for each supervising officer).

Proposal, planning••

Decision making on
acquisition
over certain amount•

Remuneration(Jun. ‘18)

Share

Fixed fee

12.5 million yen per month

75 million yen

13.5%

Incentive Fee 1

2% of JPR’s total revenue(1.5% for 8 billion yen or higher)

271 million yen

49.1%

Incentive Fee 2

3% of JPR’s income before income taxes(income before income taxes before deducting Incentive Fee 2)

206 million yen

37.4%

Incentive Fee 3

0.25% of the acquisition price upon new acquisition－－

Decision-making based on stringent processes(Interested parties: 5 sponsor companies and their parent companies, subsidiaries
and affiliates)• Acquisition of properties or assets from interested parties• Sale of properties or assets to interested parties• Consignment of property management to interested parties• Brokerage or agency by interested parties for transactions• Placement of orders for construction works (costing over 10 million yen) tointerested parties• Leasing of properties to interested parties

22

MEMO

23

JAPAN PRIME REALTY INVESTMENT CORPORATION

3. Financial Results and Forecasts of Financial Results

243. Financial Results and Operating
Forecasts

Overview of Financial Results for the 33ｒｄ Fiscal Period (Jun. ’18) (period-on-period
comparison)

Results of the 33rd fiscal period ended June 2018
DPU:7,245 yen (up22 yen, period-on-period)
Rent revenue continued to increase.
The posting of non-operating income and the reduction of financial costs contributed to the achievement of a period-on-period increase in cash distributions for the 9thconsecutive fiscal period, despite a significant increase in the burden of property and planning taxes.

Item
Operating revenue

Revenue andprofit(million yen)

DPU (yen)

Operatingindicators(million yen)

Operating expenses
Operating income
Non-operating income
Non-operating expenses
Ordinary income
Net income(per unit)NOI
NOI yield (book value)
Rental income - real estate
After-depreciation yield (book value)

Depreciation
Capital expenditures
Repairs and maintenance
Average occupancy rate
Period-end occupancy rate

Number of units outstanding (units)

32nd Period(Dec. 31, 2017)15,141
7,572
7,569
8
910
6,666
6,665
7,223
10,252
4.9%
8,331
4.0%
1,921
624
329
98.4%
98.5%
923,000

33rd Period(Jun. 30, 2018)15,204
7,869
7,335
227
877
6,685
6,686
7,245
10,033
4.9%
8,090
4.0%
1,943
1,146
473
98.2%
98.8%

Change
+63
+296
-233
+219
-33
+19
+20
+22
-218
- %pt
-240
- %pt
+22
+521
+144
-0.2%pt+0.3%pt

923,000

1. In addition to net income per share, some of the profit carried forward, which is internally reserved, is reversed to be appropriated to DPU to minimize the burden on
investors due to the accrual of income taxes.

-

Major Factors of Period-on-Period Changes
Net income+20
Rental income-240(JPY mn)* Impacts on net income indicated byplus and minus

Increase in rents and common charges+68

Increase in rent (The Otemachi Tower (land with leaseholdinterest))
Increase in cancellation penalty, etc. and income equivalent
to expense for restoration to original condition
Improvement in the balance of utilities expenses(incidental income expenses - utilities expenses)
Decrease in incidental income

+49

-115

Decrease in utilities expense+130

Decrease in outsourcing fees
Increase in property and other taxes (property and planningtaxes)
Increase in repairs and maintenance utilities expenses
Increase in brokerage fee and compensation for upwardrevision rents

+11

+ 15

-173
-144
-96
-22

Increase in depreciation

Nonoperating
income+50+252

Posting of settlement on management association accounts(for ordinary accrual: usually, posting in the June period every
year)

+59

Posting of settlement on management association accounts(for extraordinary accrual)+152

Decrease in interest expense on loans and investment
corporation bonds

+30

25

3. Financial Results and Operating
Forecasts

Overview of Financial Results for the 33rd Fiscal Period (Jun. ’18) (period-on-period
comparison)

Results of the 33rd fiscal period ended June 2018
Total assets: 446.2 billion yen, NAV per unit: 258,546 yen
Item

Balance
Sheets（million yen）

Current Asset
Cash and deposits
Cash and deposits in trust
Other current asset
Noncurrent assets
Property, plant and equipment
Intangible assets
Investments and other assets
Deferred assets
Investment corporaton bond issuance costs
Investment unit issuance expenses
Total assets
Current liabilities
Short-term loans payable
Current portion of long-term loans payable
Current portion of investment corporation bonds
Other current liabilities
Noncurrent liabilities
Long-term loans payable
Investment corporation bonds
Tenant leasehold and security deposits
Total liabilities
Unitholders' capital
SurplusReserve for reduction entry
Unapropriated retained earnings
Total net assets

32nd Period

33rd Period

Change(Dec. 31, 2017)33,265
20,77312,091
401
413,075
397,895
14,690
489
146
109
36
446,487
29,002
16,408
7,000
5,594
178,865
135,320
22,50021,045
207,868
231,653
6,966
284
6,681
238,619(Jun. 30, 2018)33,83621,115
12,066655
412,314397,104
14,690
519
146
123
22
446,297
24,88917,2002,000
5,689
182,769
136,420
25,50020,849207,659
231,653
6,985
284
6,701
238,638

+570
+342
-25
+253
-760
-791
-0
+30
+0
+14
-14
-189
-4,113+792-5,000+94+3,904+1,100+3,000
-195
-209
+19
+19
+19

Major Factors of Period-on-Period Changes
Other current asset +253
Increase in operating accounts receivable

Property, plant andequipment

+271

-791

Depreciation and loss on retirement of noncurrent assets
Capital expenditure

Current liabilities(JPY mn)-1,946+1,146-4,113

Repayment of long-term loans payable (including
amortization)-8,308Transfer of long-term loan payable (noncurrent ⇒ current)+ 9,100

Maturity of seventeen series of investment corporation
bonds-5,000Noncurrent
liabilities+3,904

Refinancing of long-term loans payable+10,200

Transfer of long-term loan payable (noncurrent ⇒ current)-9,100Issue of twenty-third series of investment corporation bonds+3,000Decrease in tenant leasehold and security deposit

-195

26

3. Financial Results and Operating
Forecasts

Overview of Financial Results for the 33rd Fiscal Period (Jun. ’18) (compared with forecast)

Results of the 33rd fiscal period ended June 2018
DPU compared with the forecast at beginning of period: up 25 yen
DPU eventually reached the level surpassing the forecast at beginning of period due to such factors as an increase in operating revenue and cancellation penalty, etc.

Item
Operating revenue
Operating expenses

Revenueand profit(million yen)

Operating income
Non-operating income
Non-operating expenses
Ordinary income
Net income

DPU (yen)(per unit)NOI
NOI yield (book value)
Rental income - real estate

Operatingindicators(million yen)

After-depreciation yield (book value)

Depreciation
Capital expenditures
Repairs and maintenance
Average occupancy rate
Period-end occupancy rate

Number of units outstanding (units)

33rd Period

33rd Period

Change(Forcast)
15,085
7,757
7,327
213
877
6,664
6,664
7,220
10,028
4.9%
8,080
4.0%
1,947
1,521
373
97.9%
97.9%

(Result)
15,204
7,869
7,335
227
877
6,685
6,686
7,245
10,033
4.9%
8,090
4.0%
1,943
1,146
473
98.2%
98.8%

+119
+111
+7
+13
+0
+20
+22
+25
+5
- %pt
+9
- %pt
-4
-374
+100
+0.3%pt+0.9%pt

923,000

923,000-

1. Forecasts of financial results for the 33rd fiscal period ended June 2018 are the figures announced on February 14, 2018, based on the following assumptions.
Investment properties owned: Total 62 properties (the properties owned at end of the 32ndt period ended December 2017)
Average occupancy rate: 97.9% (an estimate that reflect consents regarding move-ins and move-outs that will become effective in the fiscal period)
LTV (based on total assets): 40.6% (end of 33rd period (Jun. ‘18))(JPY mn)
Major Factors of Changes from Forecasts*
Impacts
onnet
incomeindicatedby
Net income+22
plus and minus

Rental income+9

Increase in rents and common charge+46

Increase in cancellation penalty, etc. and income equivalent
to expense for restoration to original condition
Decrease in other income
Increase in property and other taxes (property andplanning taxes)+92

Increase in repairs and maintenance utilities expenses
Increase in brokerage fee and compensation for upwardrevision rents-100

Decrease in other expenses+32

Nonoperating
income

-19
-8
-32

+13

Increase in settlement on management association accounts+4

Increase in income of insurance+727

3. Financial Results and Forecasts ofFinancial Results

Forecasts of Financial Results for the 34th Fiscal Period (Dec. ‘18) (compared with 33rd period)

Forecast of the 34th fiscal period ending December 2018
DPU: 7,280 yen (up 35 yen from 33rd period (Jun. ‘18) actual results)
With the upward revision of rents and the leasing up of vacancies making steady progress, rent revenue is projected to show a significant period-on-period increase.
DPU is likely to increase by filling the lack of non-operating income recorded in the previous period.

Item
Operating revenue
Operating expenses

Revenue andprofit(million yen)

Operating income
Non-operating income
Non-operating expenses
Ordinary income
Net income

DPU (yen)(per unit)NOI
NOI yield (book value)
Rental income - real estate

Operatingindicators(million yen)

After-depreciation yield(book value)

Depreciation
Capital expenditures
Repairs and maintenance
Average occupancy rate
Period-end occupancy rate

Number of units outstanding (units)

Change(JPY mn)
Major Factors of Period-on-Period Changes*
Impacts
onnet
incomeindicatedby
Net income+34
plus and minus

33rd Period

34th Period (Forecast)(Jun. 30, 2018)15,204
7,869
7,335
227
877
6,685
6,686
7,245
10,033
4.9%
8,090
4.0%
1,943
1,146
473
98.2%
98.8%

(Dec. 31, 2018)
15,540
7,970
7,569
4
852
6,720
6,720
7,280
10,301
5.0%
8,348
4.0%
1,952
1,697
471
99.0%
98.9%

+335
+100
+234
-223
-24
+35
+34
+35
+268
+0.1%pt
+258
- %pt
+9
+551
-2
+0.8%pt+0.1%pt

923,000

923,000-

1. Forecasts of financial results for the 34th fiscal period ending December 2018 based in the following assumption.
Investment properties owned: Total 62 properties (end of the 33rd period (Jun. ‘18))
Average occupancy rate: 99.0% (an estimate that reflect consents regarding move-ins and move-outs that will become effective in the fiscal period)
LTV (based on total assets): 40.6% (end of 34th period (Dec. ‘18))

Rental income+258

Increase in rents and common charge
Increase in rent (The Otemachi Tower (land with leaseholdinterest))
Lack of cancellation penalty, etc. and income equivalent to
expense for restoration to original condition
Improvement in the balance of utilities expenses (incidental
income expenses - utilities expenses)
Increase in incidental income
Increase in utilities expense
Increase in outsourcing fees
Decrease in brokerage fee and compensation for upwardrevision rents
Increase in depreciation

Nonoperating
income

+268
+49

-112
+3
+132
-128
-14
+104
-9

-198

Lack of settlement on management association accounts-212

Decrease in interest expense on loans and investment
corporation bonds

+16

28

3. Financial Results and Forecasts ofFinancial Results

Forecasts of Financial Results for the 35th Fiscal Period (Jun. ‘19) (compared with forecast forthe 34th period (Dec. ‘18)

Forecast of the 35th fiscal period ending June 2019
DPU: 7,300 yen (up 20 yen from 34th period (Dec. ‘18) forecast)
DPU is expected to continue to increase.
Aim to achieve the medium-term targets through the reduction of financial costs and cost control, in addition to continued efforts to increase rents.

Item
Operating revenue
Operating expenses

Revenue andprofit(million yen)

Operating income
Non-operating income
Non-operating expenses
Ordinary income
Net income

DPU (yen)(per unit)NOI
NOI yield (book value)
Rental income - real estate

Operatingindicators(million yen)

After-depreciation yield(book value)

Depreciation
Capital expenditures
Repairs and maintenance
Average occupancy rate
Period-end occupancy rate

Number of units outstanding (units)

34th Period (Forecast)

35th Period (Forcast)

Change(Dec. 31, 2018)
15,540
7,970
7,569
4
852
6,720
6,720
7,280
10,301
5.0%
8,348
4.0%
1,952
1,697
471
99.0%
98.9%

(Jun. 30, 2019)15,449
7,945
7,503
53
818
6,739
6,738
7,300
10,264
5.0%
8,279
4.1%
1,984
1,882
363
98.9%
98.4%

-90
-24
-65
+49
-34
+18
+18
+20
-36
- %pt
-68
+0.1%pt
+31
+184
-108
-0.1%pt-0.5%pt

923,000

923,000-

1. Forecasts of financial results for the 35th fiscal period ending June 2019 based in the following assumption.
Investment properties owned: Total 62 properties (forecast for end of the 34th period (Dec. ‘18))
Average occupancy rate: 98.9% (an estimate that reflect consents regarding move-ins and move-outs that will become effective in the fiscal period)
LTV (based on total assets): 40.6% (end of 35th period (Jun. ‘19))(JPY mn)
Major Factors of Period-on-Period Changes*
Impacts
onnet
incomeindicatedby
Net income+18
plus and minus

Rental income-68

Decrease in rents and common charge
Increase in rent (The Otemachi Tower (land with leaseholdinterest))
Deterioration in the balance of utilities expenses (incidental
income expenses - utilities expenses)
Decrease in incidental income
Decrease in utilities expense
Increase in property and other taxes (property and planningtaxes)
Decrease in repair and maintenance utilities expenses
Increase in depreciation

Nonoperating
income

-35
+47
-23
-99
+75
-139
+108
-31

+84

Appropriation of settlement on management associationaccounts
Decrease in interest expense on loans and investment
corporation bonds

+49
+29

29

3. Financial Results and Forecasts ofFinancial Results

Change in Rental Business Profits and Gain or Loss on Sale of Real Estate

An upward trend in rent revenue will continue, reflecting steady progress in internal growth.

Item
Rental revenue - real estate
Rent revenue (fixed income)Rents and common charges
Land rents
Other fixed income
Other rental revenue (variable income)
Incidental income
Cancellation penalty, etc.
Income equivalent to expenses for restoration to original condition

Other variable income
Rental business profits(million yen)

Expenses related to rent business (excluding depreciation)

Outsourcing fees
Utilities expenses
Property and other taxes
Insurance premiums
Repairs and maintenance
Property management fees
Management association accounts
Other expenses related to rent business

NOI
Depreciation
Expenses related to rent business
Rental income - real estate (a)Gain or loss on sale ofGain on sale of real estate (b)real estate (million yen) Loss on sale of real estate (c )Rental income - real estate, etc. (million yen, a + b‐c)

31st Period

32nd Period

33rd Period(Jun. 30, 2017)
14,907
14,123
12,149
1,580
393
783
682
31
35
34
4,691
575
770
2,061
25
246
259
578
172
10,216
1,907
6,599
8,308
210
8,518

(Dec. 31, 2017)15,141
14,254
12,275
1,580
398
887
788
35
29
33
4,889
598
878
2,044
25
329
268
584
160
10,252
1,921
6,810
8,331
8,331

(Jun. 30, 2018)15,204
14,38012,343
1,630
406
824
673
14
101
35
5,171
586
748
2,217
24
473
289
567
262
10,033
1,943
7,114
8,090
8,090

34th Period (Forecast) 35th Period (Forcast)(Dec. 31, 2018)
15,54014,705
12,612
1,679
413
835
805
2
26
5,238
600
877
2,211
25
471
274
570
207
10,301
1,952
7,191
8,348
8,348

(Jun. 30, 2019)15,44914,715
12,576
1,726
411
734
706
28
5,184
592
801
2,350
24
363
273
567
210
10,264
1,984
7,169
8,279
8,279

30

3. Financial Results and Forecasts ofFinancial Results

Change in Major Items
賃料等収入の変動状況

Rent revenue will increase by 320 million yen (from the 33rd fiscal period (Jun. ‘18)) for the34th fiscal period (Dec. ‘18) and by 10 million yen (from the 34th fiscal period (Dec. ‘18)) for
the 35th fiscal period (Jun. ‘19)
■ Property Taxes and City Planning Taxes Expected to Increase■ Rent revenue (factor for period-on-period changes)(from the 32nd fiscal period (Dec. ‘17))

Increase in property and city planning taxes
Collection of Otemachi Tower's rent
Increase amount of burden (net)(mn. yen)

OtemachiTower’s rent

Move
-ins
Move
-outs

Revisions,
etc.

入居

退去

+6

+49

250

14,715+203 -256+16

Other fixedincome

Move
-ins
Move
-outs

Rents andcommon +68
charge14,705

Rents andcommon -35
chargeOtemachiTower’s rent

Rents andcommon +268
charge(million yen)

Revisions,
etc.

Minus item

Move
-ins
Move
-outs

Plus item

Other fixedincomeRent revenue

300

-1

+47

14,254

Other fixedincomeOtemachiTower’s rent

+406 -460

Revisions,etc.

14,380 +455 -285 +99

200
150
100
50
0

+8

Actual increase of
burden,converted to DPU

+49

+122

82
Jun. '18-89 yen121
37
Dec. '18-40 yen

74

103

94

Jun. '19

Dec. '19

Jun. '20(forecast)(forecast)(forecast)

Dec. '20 (period)(forecast)-131 yen-80 yen-112 yen-102 yen■ Balance of Utilities Expenses (incidental income-utilities expense)(forecast) (forecast)Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19(period)

0-50
32nd period(Dec. ‘17)

33rd period(Jun. ‘18)
Rent revenue+120 million yen

Of which, rent revision (net) +120 mn. yen

34th period (Forecast)(Dec. ‘18)
Rent revenue+320 million yen

Of which, rent revision (net) +90 mn. yen

35th period (Forecast)(Jun. ‘19)
Rent revenue

-100
-150

+10 million yen

Of which, rent revision (net) +10 mn. yen-200(mn. yen)• Utilities expenses will be reduced byabout 30 million yen every period asa result of switching power providers
conducted in the Dec. ’17 andJun. ’18 periods.
• Aim to further reduce utilities
expenses through switching power
providers.

313. Financial Results and Forecasts ofFinancial Results

Fluctuations in Distribution per Unit

Distribution per unit will maintain a firm upward trend driven by an increase in rent revenue, despite theexpected lack of settlement on management association accounts in the 34th fiscal period (Dec. ‘18) andan expected increase in property and other taxes in the 35th fiscal period (Jun. ’19).

-329

7,280

-108

+23

+3

+53

Non-operating
expense+11

Non-operating
income+26

Administrative
expense.

-242

7,245

Other rental
revenue

+351

-26

Rent
revenue-83

Expenses related
to rent business

+36

+11

Non-operating
expenseRent
revenue+237

Non-operating
expenseNon-operating
incomeAdministrative
expense.

+136

-68

Expenses related
to rent business

7,223

Other rental
revenueRent
revenue(yen/unit)

Non-operating
incomeMinus item

Administrative
expense.

Plus item

Expenses related
to rent businessDistribution per unit

Other rental
revenue■ Distribution per Unit (factors for period-on-period changes)

+37

7,300

+7

Main changing Items

32nd period(Dec. 2017)

33rd Period（Jun. 2018）（Other rental revenue）
Decrease in incidental income
Increase in cancellation penalty, etc.
（Expenses related to rent business）
Decrease in utilities expense
Increase in property and other tax
Increase in repairs and maintenance expense
Increase in brokerage fee（Non-operating income and expense）
Increase in management association accounts

34th Period (Forecast)（Dec. 2018）-124 yen+54 yen+141 yen-188 yen-156 yen-67 yen（ Other rental revenue ）Increase in incidental income
Decrease in cancellation penalty, etc.
（ Expenses related to rent business ）Increase in utilities expense
Decrease in brokerage fee（Non-operating income and expense）
Lack of management association accounts

35th Period（Jun. 2019）+143 yen-122 yen-139 yen-59 yen-230 yen（ Other rental revenue ）Decrease in incidental income（ Expenses related to rent business ）Decrease in utilities expense
Increase in property and other tax
Decrease in repairs and maintenance expense（Non-operating income and expense）
Increase in management association accounts-107 yen+82 yen-151 yen+117 yen+53 yen+230 yen32

3. Financial Results and Forecasts ofFinancial Results

Traces of Growth in Distribution per Unit

Realize Growth by Steadily Achieving Targets
Aim to achieve medium-term target by continuing stable growth centering on internal growth■ Results, Forecast and Medium-Term Target of Distribution per Unit
Increase revenue through external growthManagement Regain 6,000 yen(Dec. 2010 – Dec. 2011)
targetContinue internal growth
Enhance growth potential throughexternal growth

Enhance revenue centering on internal growth

Maintain 6,000 yen

Grow to 6,500 yen

Grow to 7,000 yen

Grow to 7,500 yen(Jun. 2012 – Dec. 2013)(Jun. 2014 – Jun. 2015)(Dec. 2015 – Dec. 2016)（Dec. 2016 〜）

Beginning-of-period forecast

Results

50

87

89

92

95

98

100 173 179 184 190 195 200 206
150 260 268 276 284 293 301 309
200 347 358 368 379 390 401 412

8,000

6,430
6,000

6,400

5,680
5,750

5,000

4,0000

5,611
5,600

6,093

5,876

6,031

6,050

6,000
5,800

5,700

6,150

6,006

6,351

6,419

6,588

6,510
6,180

6,756

7,048

7,213
7,140

7,223
7,200

7,220

7,000
6,630

6,360

5,800

Increased due to recording ofproperty tax, etc. on properties
acquired in 21st period(Jun. ’12) to costs

18th
19th
20th
21st
22nd
23rd
24th
25th
26th
27th
28th
29th
30th
31st
32nd
33rd
(Dec. ’10) (Jun. ’11) (Dec. ’11) (Jun. ’12) (Dec. ’12) (Jun. ’13) (Dec. ’13) (Jun. ’14) (Dec. ’14) (Jun. ’15) (Dec. ’15) (Jun. ’16) (Dec. ’16) (Jun. ’17) (Dec. ’17) (Jun. ’18)

1. Distribution per unit as medium-term target is a management target set by TRIM, and there is no guarantee that the figure is achieved.
2. ”Estimate of an increase in DPU due to the acquisition of properties” does not include fund procurement costs.

7,300 7,500

7,245Internal growth
Financial strategy

7,000

100 103

External growth(yen/unit)

Price (100 mn. Yen)

Estimate of an increase in DPU(yen/unit)
due to the acquisition of properties
After-depreciation yield（%）
3.2 3.3 3.4 3.5 3.6 3.7 3.8‘Jun. ‘19

（period）

Medium-termtarget33

JAPAN PRIME REALTY INVESTMENT CORPORATION

4. Appendix

34

4. Appendix

Fund Summary
29th Period(Jun. 2016)

28th Period(Dec. 2015)

33rd Period(Jun. 2018)

42.1%

43.7%

40.7%

40.6%

40.6%

LTV (unrealized gains and losses)

After-depreciation yield (book value)

40.3%
4.6%
4.8%
4.5%
3.7%
3.8%

39.4%
4.6%
4.9%
4.5%
3.7%
3.9%

40.3%
4.9%
5.1%
4.7%
4.0%
4.2%

36.5%
4.8%
5.0%
4.5%
3.9%
4.1%

35.5%
4.7%
4.9%
4.3%
3.8%
4.0%

34.9%
4.7%
4.9%
4.2%
3.8%
4.0%

Implied cap rate

3.5%

3.7%

3.5%

3.8%

3.9%

3.7%

FFO

7,624 million yen

7,783 million yen

8,336 million yen

8,577 million yen

8,587 million yen

8,632 million yen

AFFO

6,778 million yen

7,010 million yen

7,612 million yen

8,014 million yen

7,962 million yen

7,485 million yen

8,733 yen

8,915 yen

9,549 yen

9,293 yen

9,303 yen

9,352 yen

Net asset per unit
NAV per unit

6,586 yen
6,588 yen
3.1%
5.3%
84 yen247,696 yen
263,026 yen

6,754 yen
6,756 yen
3.2%
5.5%
84 yen247,862 yen
273,915 yen

7,047 yen
7,048 yen
3.0%
5.6%
84 yen248,154 yen
283,129 yen

7,440 yen
7,213 yen
3.6%
5.8%
308 yen258,516 yen
306,192 yen

7,221 yen
7,223 yen
3.9%
5.6%
308 yen258,525 yen
320,060 yen

7,243 yen
7,245 yen
3.5%
5.6%
308 yen258,546 yen
329,845 yen

Investment unit price

420,500 yen

422,500 yen

465,000 yen

405,000 yen

367,000 yen

416,500 yen

1.7 times
1.9 times
31.9 times
24.1 times
84.8%
8.7 times
6.9 times

1.5 times
1.7 times
31.3 times
23.7 times
84.1%
8.7 times
7.2 times

1.6 times
1.9 times
33.0 times
24.3 times
80.8%
9.1 times
7.7 times

1.3 times
1.6 times
27.2 times
21.8 times
83.1%
10.7 times
8.7 times

1.1 times
1.4 times
25.4 times
19.7 times
83.7%
11.2 times
9.0 times

1.3 times
1.6 times
28.7 times
22.3 times
89.3%
11.6 times
9.0 times

NOI yield (appraisal value)
After-depreciation yield (acquisition price)

FFO per unit
EPS
Cash distribution per unit
Dividend yield
ROE
Reserve for reduction entry per unit

(immediately before the ex-right date)

NAV multiple
PBR
PER
FFO multiple
AFFO payout ratio
DSCR
Interest coverage ratio

3.
4.

32nd Period(Dec. 2017)42.1%

NOI yield (book value)2.

31st Period(Jun. 2017)

LTV (total assets)

NOI yield (acquisition value)1.

30th Period(Dec. 2016)

Implied cap rate = NOI (annualized, forecast for the next fiscal period x 2) / (market
capitalization + interest-bearing debts – cash and deposits + tenant leasehold andsecurity deposits)
FFO = Net income + depreciation – gain on loss on sale of real estate properties(including loss on retirement of non-current assets)
AFFO = FFO – capital expenditures
EPS = Net income / number of units outstanding (end of period)

5.
6.
7.
8.
9.

Dividend yield = Cash distribution per unit (annualized, most recent result x 2) /investment unit priceROE (return on equity) ＝ Net income (annualized, most recent result x 2) / net
assetsNAV per unit = (Net assets + unrealized gains or losses – total cash distributions) /number of units outstanding (end of period)
NAV multiple = Investment unit price / NAV per unit
PBR (price book-value ratio) = Investment unit price / net assets per unit

10.
11.
12.
13.
14.
15.

PER (price earnings ratio) = Investment unit price / EPS (annualized, most recent result x 2)
FFO multiple = Investment unit price / FFO per unit (annualized, most recent result x 2)
AFFO payout ratio = Total cash distributions / AFFODSCR = (Net income + depreciation + interest expenses) / interest expenses
Interest coverage ratio = Operating revenue / interest expenses
Reserve for reduction entry indicates the figure calculated by adding or subtracting the amounts brought
forward or reversed in the relevant fiscal period to or from the balance at the end of the fiscal period.

35

4. Appendix

Track Record of 16 Years■ Cash Distribution per Unit and Occupancy Rate
Cash distribution per unit (yen)Occupancy rate (%)

99.0 98.7 98.0 97.0
96.9 97.0 97.2 97.5 97.4 97.8 98.3 98.5 98.4 98.2
96.2 96.4 96.1
96.1 97.7 98.3
95.2 94.0 93.8
93.6 94.0 95.0 94.8 94.4 95.6
92.6 93.1 94.3 94.9

Occupancy rate

96.2％ on average
6,912 6,873

6,671
5,738

6,081

6,370 6,411 6,509

6,873 6,996 6,671 7,122 7,092

6,933 6,770

6,430
5,680 5,611 5,876

6,093 6,031 6,006 6,150

6,756
6,351 6,419 6,588

7,048 7,213 7,223 7,245

Cash distribution per unit

3,731

6,452 yen on average

2,545(excluding the 1st Period)

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

11th

12th

13th

14th

15th

16th

17th

18th

19th

20th

21st

22nd

23rd

24th

25th

26th

27th

28th

29th

30th

31st

32nd

33rd

(Jun. ‘02)

(Dec. ’02)

(Jun ’03)(Jun ’03)(Jun. ’04)

(Dec. ’04)

(Jun. ’05)

(Dec. ’05)

(Jun. ’06)

(Dec. ’06)

(Jun. ’07)

(Dec. ’07)

(Jun. ’08)

(Dec. ’08)

(Jun. ’09)

(Dec. ’09)

(Jun. ’10)

(Dec. ’10)

(Jun. ’11)

(Dec. ’11)

(Jun. ’12)

(Dec. ’12)

(Jun. ’13)

(Dec. ’13)

(Jun. ’14)

(Dec. ’14)

(Jun. ’15)

(Dec. ’15)

(Jun. ’16)

(Dec. ‘16)

(Jun. ’17)

(Dec. ’17)

(Jun. ’18)

(period)■ Asset Size
Office properties inTokyo

Office properties in
Other Cities

1,257 1,396

1,636

1,796

Retail properties

3,986 4,047 4,047 4,055
3,809 3,919(based on acquisition price; 100 million yen)

2,224
1,976 2,026 2,092

2,453 2,519

2,751 2,806

2,994 3,106

4,095 4,103 4,103 4,214

4,350 4,350 4,350

3,312 3,415 3,415 3,449

Breakdown by area andby asset class(as of June 30, 2018)
Office properties inTokyo
293.0 billion yen
Office properties in Other
Cities41.0 billion yen

921 945

Retail properties

100.9 billion yen
1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

11th

12th

13th

14th

15th

16th

17th

18th

19th

20th

21st

22nd

23rd

24th

25th

26th

27th

28th

29th

30th

31st

32nd

33rd

(Jun. ‘02)

(Dec. ’02)

(Jun ’03)(Jun ’03)(Jun. ’04)

(Dec. ’04)

(Jun. ’05)

(Dec. ’05)

(Jun. ’06)

(Dec. ’06)

(Jun. ’07)

(Dec. ’07)

(Jun. ’08)

(Dec. ’08)

(Jun. ’09)

(Dec. ’09)

(Jun. ’10)

(Dec. ’10)

(Jun. ’11)

(Dec. ’11)

(Jun. ’12)

(Dec. ’12)

(Jun. ’13)

(Dec. ’13)

(Jun. ’14)

(Dec. ’14)

(Jun. ’15)

(Dec. ’15)

(Jun. ’16)

(Dec. ‘16)

(Jun. ’17)

(Dec. ’17)

(Jun. ’18)

(period)36

4. Appendix

Portfolio Diversification (as of June 30, 2018)

Ratio by Asset Class

Ratio by Area

Ratio by Asset Size

(Ratio of Acquisition Price)(Ratio of Acquisition Price)(Office Properties, Ratio of Acquisition Price)• Portfolio management standards (target investment ratios):
70 - 90% for office properties / 30 - 10% for retail properties• Portfolio management standards (target investment
ratios): 80 - 90% for Tokyo / 20 - 10% for Other Cities

23.2%
Retailproperties

Medium-sized

Other Cities

15.5%
Officeproperties
Greater Tokyo(3,000 m2 to less than 10,000
m2)

Central Tokyo

30.7%

Very large(30,000 m2 or more)

56.3%

28.2%

45.2%

Large
(10,000 m2 to less than
30,000 m2)

76.8%

24.1%

Ratio by Rent Zone

Ratio by Tenant’s Industry

Ratio of Co-Owned Properties, Etc.

(Office Properties in Central Tokyo, Ratio of Acquisition Price)(Office Properties, Area Ratio)(Ratio of Acquisition Price)

Less than 15
thousand yen

Medical and Welfare 1.2%

2.6%
30 thousand yen
more

Other 1.7%

Transportation 3.3%
Public Services 3.9%
Real Estate

24.7%

6.3%
Construction

15 to less than 20
thousand yen

6.5%

43.1%

23.2%

25 to lessthan 30
thousand yen
or more20 to less than 25
thousand yen

Services

21.9%

7.3%
Wholesale and Retail

Information andCommunications

9.9%

19.5%
11.6%

Finance andInsurance

Full ownership
32 buildings

Co-owned
properties, etc.
30 buildings

42.5%

57.5%

Manufacturing

13.4%

37

4. Appendix

Tenant Diversification (as of June 30, 2018)■ Ratio of Tenant Occupancy (by property; based on end tenants)• The number of office tenants other than the sponsors, etc. with tenant
occupancy of 1% or more is only 3 (combined occupancy: 3.7%)(excluding property comprising land with leasehold interest) .
• Many of the retail tenants have long-term lease contracts, and thepossibility for them to cancel is rather small.

■ 20 Largest Tenants (by property; based on end tenants)
Category(No. of tenants)

Tenant28.3%

Less than 1%

66.3%

Sponsors, etc. with
1% or more

1.7%
Other tenants with
3.7%
1% or more

Ratio ofoccupancy(%)

Housing Design Center Kobe

35,444.13

7.5

Seiyu GK

Tanashi ASTA

31,121.71

6.6

Ito-Yokado Co., Ltd.

JPR Musashikosugi Bldg.

19,740.95

4.2

JPR Umeda Loft Bldg.

18,586.97

3.9

Musashiurawa Shopping Square

9,558.51

2.0

Tower Records Japan Inc.

JPR Shibuya Tower Records Bldg.

8,076.85

1.7

The Maruetsu, Inc.

Cupo-la Main Bldg.

5,963.00

1.3

A companyMusashiurawa Shopping Square

5,285.40

1.1

The Otemachi Tower(land with Leasehold Interest

7,875.50

1.7

Rise Arena Bldg.

6,023.39

1.3

Yakuin Business Garden

6,019.95

1.3

JPR Nagoya Fushimi Bldg.

5,313.36

1.1

Ｅ company

Olinas Tower

4,561.87

1.0

Sompo Japan Nipponkoa Inc.

Sompo Japan Sendai Bldg.

4,400.03

0.9

Ｆcompany

Olinas Tower

4,255.56

0.9

Ｇ company

Shinjuku Square Tower

4,242.48

0.9

Ｈ company

Niigata Ekinan Center Bldg.

4,078.97

0.9

Ｉ company

Omiya Prime East

4,005.05

0.9

Ｊ company

MS Shibaura Bldg.

3,922.74

0.8

Ｋ company

Gotanda First Bldg.

3,869.35

0.8

Sponsors, etc. with
1% or more
Tokyo Prime Stage Inc.
(1 company)
Other tenants with Ｂ company
1% or more
Ｃ company(3 companies)
Ｄ company

Less than 1%(735 companies)

Leasedspace(㎡)

ABC Development Corporation

Retail tenants with The LOFT, Co., Ltd.
1% or more
Olympic Group Corporation(8 companies)
Retail tenants with
1% or more

Occupying property

38

4. Appendix

Move-Ins and Move-Outs of Tenants (as of June 30, 2018)■ Breakdown and Changes in Move-Ins and Move-Outs■ Move-In/Move-Out Spaces by Property(Move-in/move-out spaces by area and asset class: m2)

Move-Ins

Office properties inCentral Tokyo
Office properties inGreater Tokyo
Office properties in
Other Cities-2,959-471

30,00020,00011,764

10,870+78

Shinagawa Canal Building

+0

518

-1,828-1,309Science Plaza - Yonbancho Plaza-113

19,916-18,773+1,143-10,000-7,641-10,392

(%)

2.5

5

3
1.4
19,916

11,3107,605

0-12,890-10,341-10,367

1

6,387-3,707-1-0.8-18,773-1.7-20,000-30,000

-2.3
-2.9

+0

+3,722

1.7
13,663+4BYGS Shinjuku Bldg.

-4,157

Rate of move-outs (right axis)
4.3

10,000Shinjuku Square Tower

7,879

Move-outs (left axis)

3.0

+0

Shinjuku Center Building

Rate of move-ins (right axis)

2.4

JPR Ichigaya Bldg.

-798

Move-ins (left axis)

2.6

+0

-9,828(Changes in move-in/move-out spaces and rate of move-ins/move-outs)(㎡)

Gotanda First Bldg.

9,030

Retail properties
Total

Net Increase/DecreaseMove-Outs

2,487

Move-ins – move-outs

-2.3

-3

-2.3
-4.1

-5

Jun. '15 Dec. '15 Jun. '16 Dec. '16 Jun. '17 Dec. '17 Jun. '18 (p)riod)

Tokyo Square Garden-440

JPR Jingumae 432+137

JPR Ginza Namiki-dori Bldg.

+145

Arca East+482

JPR Chiba Bldg.

-75

JPR Yokohama Nihon Dori Bldg.

-370

Kawaguchi Center Bldg.

+582

ＪＰＲUeno East Bldg.

-21

Tachikawa Business Center Bldg.

-890

Yume-ooka Office Tower+129

Olinas Tower-334

Tokyo Tatemono Yokohama Bldg.

-299

Kawasaki DICE Bidg.

-1,592Move-outs

Move-ins-1,179

(㎡)

1,179

-516
-18
-211

516
22
211
78

-251
-113
-668
-235

251
228
372
145
482
98

-173
-935

565
770

-187
-2,359

2,337
-890
129

-4,1853,850-1,096-1,592

797

Tokyo Tatemono Honmachi Bldg. +2,100

2,100

JPR Hakata Bldg.

+2

Tenjin 121 Bldg.

+0

-296

296

JPR Dojima Bldg.

-142

-431

288

+91 -3,429
Yakuin Business Garden
JPR Shinsaibashi Bldg. +1,670

2

3,521
1,670

39

4. Appendix

Occupancy Rate and Rent

■ Changes in Occupancy Rate, Average Downtime and Rents
Item
Occupancy rate based on
conclude contract (office),%Occupancy rate based on
conclude contract (retail), %Occupancy rate based on
generated rents (office), %Occupancy rate based on
generated rents (retail), %Average downtime, monthBase rent (existing properties),yen
Average rent (existing properties),yenTarget rent (existing properties),yen
Gap in actual rent, yen(forecast)(forecast)

Dec. 2015(28th period)

Jun. 2016(29th period)

Dec. 2016(30th period)

Jun. 2017(31st period)

Dec. 2017(32nd period)

Jun. 2018(33rd period)

Dec. 2018(34th period)

Jun. 2019(35th period)

96.1

96.8

97.5

97.8

97.8

97.6

98.6

98.9

100.0

99.9

100.0

100.0

99.7

99.4

100.0

100.0

92.9

94.7

96.0

96.5

97.1

95.8

97.7

97.9

99.9

99.9

99.9

99.9

99.6

99.2

99.5

99.8

8.5

7.9

3.8

4.3

9.5

3.1

8.8

13.7

15,127

15,602

15,933

16,031

16,196

16,802

17,229-16,717

16,814

16,952

17,127

17,19917,49017,582-

16,456

16,886

17,206

17,38017,561

18,157

18,573

-

-

-6.3

-4.1

-4.7

-7.0

-7.5

-

-

Central Tokyo

ChangeGreater Tokyo

ChangeOther cities

Change19,845+416

15,274+372

13,286+1,35620,189+195

17,097+233

12,825+575

21,136+295

16,801+411

14,492+1,489■ Status of Rent by Area (Jun. 2018)
Item
Base rent (existing properties),yen
Average rent (existing properties),yenTarget rent (existing properties),yen■ Status of Rent revision, Rent Through Tenant Replacement and Contribution Rate (Jun. 2018)
Item
Upward revision

Downward revision
Not change revision
Subtotal rent revision
Increase in rent upon tenant
replacement
Decrease in rent upon tenant
replacement
Subtotal tenant replacement
Total (rent revision and tenant
replacement)

Amount ofmonthly rent,
million yen
+23.2
-3.0
0.0
+20.2

Number of
cases

Percentage ofcases, %

96
6
107
209

+7.6%
-4.2%
0.0%
+2.9%

+9.0

25

+16.0%

-4.7

16

-9.2%

+4.3

41

+4.0%

+24.5

250

40

4. Appendix

Yields (as of June 30, 2018)■ Yields by Area and by Asset Class (based on book value)

Central Tokyo(NOI yield)
(%)

10

5

■ NOI Yield by Property (based on book value)

Circle size = portfolio asset size (book value)
Center of circle = NOI yield(%)

0

OfficeOfficeproperties in
Retailproperties in Greater Tokyo
OfficeCentralproperties
properties inTokyo
Other Cities
6.2%
5.3%
5.6%

Kanematsu Bldg.

10

3.5

JPR Ichigaya Bldg.

BYGS Shinjuku Tower

0

Minami Azabu Bldg.

(After-depreciation yield)(%)

Shinagawa Canal Bldg.

Circle size = portfolio asset size (book value)
Center of circle = after-depreciation yield

Rise Arena Bldg.

10
OfficeOfficeproperties in properties inCentralGreater Tokyo
Tokyo

5

4.6%
3.6%

JPR Nihonbashi-horidome Bldg.

Retailproperties
Officeproperties in
Other Cities
4.5%
3.8%

Portfolio average
4.0%

JPR Sendagaya Bldg.
Ginza Sanwa Bldg.
The Otemachi Tower(land with leasehold Interest)

Tokyo Square Garden
JPR Shibuya Tower Records Bldg.
JPR Jingumae 432
Shinjuku Sanchome East Bldg.

0

Yurakucho Ekimae Bldg.
JPR Ginza Namiki-dori Building
FUNDS Suidobashi
Average of Central Tokyo

8.9
4.4
6.1
4.6
6.4

JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
Average of Greater Tokyo

10.7

Niigata Ekinan Center Bldg.

1.3

Tokyo Tatemono Honmachi Bldg.

7.0

JPR Hakata Bldg.

9.6
11.0
11.3

JPR Naha Bldg.

5.8
6.2

Shibadaimon Center Building

14.1

Tanashi ASTA
Cupo-la Main Bldg.

2.9
4.0
3.3

Science Plaza-Yonbancho Plaza

Olinas Tower

Omiya Prime East

6.8
4.5
5.6
6.5

Tokyo Tatemono Kyobashi Bldg.

Yume-ooka Office Tower

Tokyo Tatemono Yokohama Bldg.

7.4

Rokubancho Bldg.

9.9

JPR Ueno East Bldg.

8.5

3.1
5.0
2.6
3.7
3.2
3.2
4.4
4.1

15

7.4
6.4
5.8
6.5
6.5
5.3
6.1
7.7

Tachikawa Business Center Bldg.

3.3
3.4
4.4

10
5.9
6.2
6.7

Kawaguchi Center Bldg.

4.0
5.1

JPR Harajuku Bldg.

5

Shinyokohama 2nd Center Bldg.

4.7
5.7
5.3
3.7

Across Shinkawa Bldg. Annex
Shinjuku Center Bldg.

0

JPR Yokohama Nihon Odori Bldg.

7.0
6.4

Oval Court Ohsaki Mark West
Shinjuku Square Tower(%)-5
Arca East Bldg.

Shin-Kojimachi Bldg.
JPR Crest Takebashi Bldg.

15

JPR Chiba Bldg.

5.4

JPR Ningyo-cho Bldg.

Gotanda First Bldg.

Portfolio average
4.9%

5Kanematsu Bldg. Annex

MS Shibaura Bldg.

4.1%

Greater Tokyo and Other Cities

Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.

6.6
6.9

Tenjin 121 Bldg.
JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.

4.7

Yakuin Business Garden

6.5
4.9

JPR Umeda Loft Bldg.
JPR Shinsaibashi Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.
Average of Other Cities

-0.3

6.6
4.6
5.4

41

4. Appendix

Diversification of Lenders and Lender Formation (as of June 30, 2018)

Diversifying fund procurement sources with a lender formation comprising
30 financial institutions and through issuance of investment corporation bonds
Interest-bearing debt balance: 181,120 million yen
The 77 Bank, Ltd. (new borrower)
NTT FINANCE CORPORATION(new borrower)

Yamaguchi Bank, Ltd.
Sumitomo Mitsui Trust Bank, Ltd
Hiroshima Bank, Ltd.
Tokyo Marine & Nichido Fire Insurance
Daido Life Insurance Company
Daishi Bank, Ltd
The Iyo Bank, Ltd

Resona Bank, Ltd
The Hachijuni Bank, Ltd
Sompo Japan Nipponkoa Insurance Inc.
National Mutual
Cooperatives

Insurance

Federationof

Agricultural

Sumitomo Life Insurance Company
ORIX Bank Corporation
The Norinchukin BankThe Chugoku Bank, Ltd
Taiyo Life Insurance Company

The Nishi-Nippon City Bank, Ltd.
The Shinkumi Federation Bank
Meiji Yasuda Life Insurance Company

1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
2,000
2,000
2,000
2,000
2,000
2,000
3,000
3,000
3,000
4,000
4,000
4,200

Investment corporation
bonds
27,500(million yen)

(Breakdown of investment corporation bonds)
Seventh series of bonds

Mizuho Bank, Ltd
27,000Fourteenth series of bonds
Sixteenth series of bonds
Eighteenth series of bonds
Nineteenth series of bonds
Twentieth series of bonds

MUFG Bank, Ltd.
26,000Twenty-first series of bonds
Twenty-second series of bonds
Twenty-third series of bonds

Sumitomo Mitsui Banking
Corporation
12,500Development Bank of Japan,
Inc.
11,020

The Bank of Fukuoka, Ltd.
5,000
Shinkin Central Bank 5,000

Shinsei Bank, Ltd. 10,000

Mizuho Trust & Banking Co.,
Ltd. 7,000(Status of commitment line)
LenderMizuho Bank, Ltd.
MUFG Bank, Ltd.
Sumitomo Mitsui Banking
Corporation
Aozora Bank, Ltd
Mizuho Trust & Banking Co, Ltd.

Resona Bank, Ltd

Aozora Bank, Ltd. 7,900

4,500
2,000
2,000
2,000
5,000
2,000
4,000
3,000
3,000

Total

Credit Limit

4,000
4,000
4,000
4,000
4,000
4,000
24,00042

4. Appendix

Appraisal Value (as of June 30, 2018)■ An Increase in Unrealized Gains■ Factors of Change in Appraisal Value• Unrealized gains expanded to 72.4 billion yen due to an increase inappraisal value• Appraisal value increased for 48 properties with direct cap rate falling for
39 properties (out of 62 properties in total)
Appraisal value
Unrealized gains
Ratio of unrealized gains
484.2 billion yen
72.4 billion yen
17.6%(up 8.2 billion yen from 32nd
period (Dec. ‘17))(up 9.0 billion yen from 32nd
period (Dec. ‘18))(Changes in direct cap rate)• Decreased by 1.1 percentage points from the 17th period ended June 2010
(4.8%), the peak period for office properties in Central Tokyo
Entire portfolio
Ofice properties in Central Tokyo

(％)

5.2

(up 2.2% pt from 32nd period(Dec. ‘18))

4.9
4.6

4.3

(Changes in unrealized gains and losses)

4.0

Unrealized gains and losses（left axis）
Ratio of unrealized gains and losses（right axis）(100 million yen)

(％)

800

40

3.7
3.4
0.0

72.4 billion yen

Jun.

Jun.

Jun.

Jun.

Jun.

Jun.

Jun.

Jun.

Jun.

Jun.

700

35

'08

'10

'11

'12

'13

'14

'15

'16

'17

'18

600

30

500

25

400

17.6% 20300

15

1. The changes in direct cap rate indicate the figures for the 48 properties JPR has owned since the end of June 2009 for the "Entire
portfolio," and for the 15 properties JPR owns since the date for "Office properties in Central Tokyo," respectively.

(Breakdown of unrealized gains and losses)• Amounts of both unrealized gains and unrealized losses improved from theend of the 32nd period (Dec. ’17).
(billion yen)

+90

200

10

100

5

0

0

-100

-5

-200

-10

+60
+30

Jun. '02

Jun. '04

Jun. '06

Jun. '08

Jun. '10

Jun. '12

Jun. '14

Jun. '16-15

Jun. '18 (period)

Unrealized gains

Total 62
properties

72.4 billion yen

+0
-30

-300

(period)

Unrealized losses

49 properties

87.9 billion yen
13 properties-15.4 billion yen

Entire portfolio

Breakdown of unrealized gains andlosses43

4. Appendix

Property nameAppraisal Value by Property (as of June 30, 2018)

Appraisal value Change（mn yen）（mn yen）

Direct cap(NCF Cap)(%)

Change（% pt）

DCF
discountrate(%)

Change(% pt)

DCF
terminal
cap(%)

Change（% pt）

UnrealizedBook value
gain or loss
(mn yen)(mn yen)

Property nameAppraisal value Change（mn yen）（mn yen）

Direct cap(NCF Cap)(%)

Change（% pt）

DCF
discountrate(%)

Change(% pt)

DCF
terminal
cap(%)

Change（% pt）

Book value(mn yen)

Unrealized
gain or loss
(mn yen)Kanematsu Bldg.

13,900

+100

3.5

0.0

3.3

0.0

3.7

0.0

14,602-702

Arca East

6,420

+170

4.1

-0.1

3.8

-0.1

4.3

-0.1

4,268

+2,151

Kanematsu Bldg. Annex

2,520

-

3.9

0.0

3.7

0.0

4.1

0.0

2,428

+91

JPR Chiba Bldg.

1,780

+100

5.3

0.0

5.1

0.0

5.5

0.0

2,220

-440

JPR Ningyo-cho Bldg.

2,490

-220

4.1

-0.1

3.9

-0.1

4.3

-0.1

1,947

+542

JPR Yokohama Nihon Odori Bldg.

2,340

-

4.9

0.0

4.7

0.0

5.1

0.0

2,461

-121

Shin-Kojimachi Bldg.

3,580

+270

3.9

-0.1

3.6

-0.1

4.1

-0.1

2,443 +1,136

Shinyokohama 2nd Center Bldg.

1,810

+60

4.8

-0.1

4.6

-0.1

5.0

-0.1

1,410

+399

JPR Crest Takebashi Bldg.

3,360

+30

3.8

0.0

3.6

0.0

4.0

0.0

3,250

Kawaguchi Center Bldg.

9,590

+610

5.0

-0.1

4.7

-0.1

5.2

-0.1

7,106

+2,483

MS Shibaura Bldg.

12,300

+600

4.3

-0.1

4.0

-0.1

4.5

-0.1

10,951 +1,348

JPR Ueno East Bldg.

4,850

+350

4.0

-0.2

3.8

-0.1

4.2

-0.1

2,948

+1,901

Gotanda First Bldg.

2,810

+30

4.0

0.0

3.7

0.0

4.2

0.0

2,935

-125

Tachikawa Business Center Bldg.

3,940

+130

4.4

-0.1

4.1

-0.1

4.6

-0.1

2,864

+1,075JPR Ichigaya Bldg.

5,230

+20

3.7

0.0

3.5

0.0

3.9

0.0

5,192

+37

Rise Arena Bldg.

8,630

+130

4.0

-0.1

3.7

-0.1

4.1

-0.1

5,258

+3,371

Oval Court Ohsaki Mark West

4,940

-

3.9

0.0

3.7

0.0

4.1

0.0

2,828 +2,111

Yume-ooka Office Tower

6,510

-

4.3

-0.2

4.0

-0.2

4.5

-0.2

5,405

+1,104

Shinjuku Square Tower

14,800

+400

3.8

-0.1

3.6

-0.1

4.0

-0.1

13,319 +1,480

Olinas Tower

37,500

+700

3.9

-0.1

3.6

-0.1

4.1

-0.1

27,378+10,121BYGS Shinjuku Bldg.

19,000

-

3.7

0.0

3.5

0.0

3.9

0.0

15,426 +3,573

Tokyo Tatemono Yokohama Bldg.

8,500

+240

4.4

-0.1

4.1

-0.1

4.5

-0.1

6,877

+1,622

891

+1

4.6

0.0

4.4

0.0

4.8

0.0

594

+296

Omiya Prime East

8,610

+230

4.6

0.0

4.4

0.0

4.8

0.0

5,787

+2,822

Shinjuku Center Bldg.

15,800

-

3.5

0.0

3.2

0.0

3.7

0.0

22,152-6,352

Tanashi ASTA

12,500

-

5.2

0.0

5.1

0.0

5.4

0.0

7,265

+5,234

Minami Azabu Bldg.

2,930

+90

4.1

-0.1

3.9

-0.1

4.3

-0.1

3,826

-896

Cupo-la Main Bldg.

2,800

-

5.2

0.0

5.0

0.0

5.4

0.0

1,695

+1,104

Shinagawa Canal Bldg.

1,870

-

4.2

0.0

3.9

0.0

4.4

0.0

1,727

+142

JPR Musashikosugi Bldg.

5,690

-50

4.7

-0.1

4.5

-0.1

4.9

-0.1

7,006

-1,316

Rokubancho Bldg.

3,440

+30

5.1

-0.1

4.0

-0.1

4.4

-0.1

2,831

+608

Musashiurawa Shopping Square

4,350

+60

4.9

-0.1

4.8

-0.1

5.1

-0.1

3,663

+686

JPR Harajuku Bldg.

9,670

+530

3.7

-0.2

3.5

-0.2

3.9

-0.2

8,686

+983

Kawasaki Dice Bldg.

16,200

-300

4.2

0.0

4.1

0.0

4.4

0.0

13,325+2,874

Tokyo Tatemono Kyobashi Bldg.

5,720

-

4.2

0.0

3.7

0.0

4.3

0.0

5,298

+421

Niigata Ekinan Center Bldg.

2,230

-

5.8

0.0

5.8

0.0

6.0

0.0

1,614

+615

JPR Nihonbashi-horidome Bldg.

6,830

+110

4.2

-0.1

4.0

-0.1

4.4

-0.1

4,721 +2,108

Tokyo Tatemono Honmachi Bldg.

3,490

+20

4.7

-0.1

4.4

-0.1

4.9

-0.1

4,261

-771

JPR Sendagaya Bldg.

12,000

+200

3.8

-0.1

3.6

-0.1

4.0

-0.1

14,861-2,861

JPR Hakata Bldg.

3,470

+70

4.5

0.0

4.4

0.0

4.7

0.0

2,948

+521

4,080

+20

3.1

-0.2

2.8

-0.3

3.2

-0.3

3,707

+372

JPR Naha Bldg.

1,860

+140

5.3

-0.1

5.3

-0.1

5.5

-0.1

1,362

+497

48,300

+600

2.8

0.0

2.7

0.0

2.9

0.0

38,388 +9,911

Sompo Japan Sendai Bldg.

4,040

+90

5.1

-0.1

4.9

-0.1

5.4

-0.1

2,426

+1,613

Across Shinkawa Bldg. Annex

Ginza Sanwa Bldg.
The Otemachi Tower (Land with Leasehold Interest)+109

Science Plaza - Yonbancho Plaza

3,380

+90

4.1

-0.1

3.7

-0.1

4.3

-0.1

2,717

Sompo Japan Wakayama Bldg.

1,620

+30

6.5

-0.1

6.3

-0.1

6.8

-0.1

1,313

+306

Shibadaimon Center Bldg.

6,660

+270

3.8

-0.1

3.5

-0.1

4.0

-0.1

4,171 +2,488+662

Tenjin 121 Bldg.

3,030

+100

4.5

-0.1

4.1

-0.1

4.7

-0.1

2,064

+965

Tokyo Square Garden

20,600

+200

2.7

0.0

2.5

0.0

2.9

0.0

18,620 +1,979

JPR Dojima Bldg.

3,100

+100

4.4

-0.1

4.2

-0.1

4.5

-0.1

2,168

+931

JPR Shibuya Tower Records Bldg.

14,500

+100

3.5

0.0

3.3

0.0

3.7

0.0

11,492 +3,007

JPR Nagoya Fushimi Bldg.

2,960

+70

5.2

-0.1

4.7

-0.1

5.1

-0.1

3,870

-910

JPR Jingumae 432

4,110

+10

3.1

0.0

3.2

0.0

3.3

0.0

4,280

-170

Yakuin Business Garden

16,600

+400

4.3

-0.1

4.1

0.0

4.5

0.0

10,403+6,196

Shinjuku Sanchome East Bldg.

2,910

+90

3.5

-0.1

3.0

-0.1

3.7

-0.1

2,607

+302

JPR Shinsaibashi Bldg.

4,490

+250

3.8

-0.3

3.5

-0.1

3.9

-0.1

5,159

-669

Yurakucho Ekimae Bldg. (Yurakucho Itocia)

3,240

+100

3.1

-0.1

2.7

-0.1

3.3

-0.1

3,309

-69

JPR Umeda Loft Bldg.

14,100

+200

4.0

-0.2

3.7

-0.2

4.2

-0.2

12,394+1,705JPR Ginza Namiki-dori Building

11,300

+500

2.9

-0.2

2.6

-0.2

2.9

-0.2

10,142 +1,157

Housing Design Center Kobe

7,280

+20

5.5

-0.1

5.3

-0.1

5.6

-0.1

6,120

+1,159FUNDES Suidoubashi

3,640

+70

3.6

-0.1

3.4

-0.1

3.8

-0.1

3,233

JPR Chayamachi Bldg.

7,200

+80

3.5

-0.1

3.2

-0.1

3.6

-0.1

6,041

+1,158

+406

Total

484,291 +8,241

411,794+72,496

Central Tokyo

266,801 +4,241

242,697+24,103

Greater Tokyo

142,020 +2,430

106,946+35,073

Other Cities

75,470 +1,570

62,150+13,319

1. Direct cap indicates the capitalization rate that serves as the standard for calculating the value estimated by income approach based on the direct capitalization method.
2. DCF discount rate and DCF terminal cap indicate the period income discount rate and the terminal capitalization rate that serve as the standard for calculating the value estimated by income approach based on the discounted cash flow (DCF) method.

44

4. Appendix

Asset Manager■ Summary of Asset Manager■ Sponsors(as of June 30, 2018)(as of June 30, 2018)

Name

Tokyo Realty Investment Management, Inc. (TRIM)

Address

4-16 Yaesu 1-Chome, Chuo-ku, Tokyo

Date of Foundation

April 28, 2000

Paid-in CapitalName

No. ofShareholding
seconded staff
ratiofrom sponsors

Tokyo Tatemono

52%

11

350 million yen

Yasuda Real Estate

18%－

Business Description

Asset management for investment corporation

Taisei Corporation

10%－

President and CEO

Yoshihiro Jozaki

Directors

10 (5 full-time and 5 part-time)

Sompo Japan Nipponkoa Insurance

10%

1

Number of Officers

36

Meiji Yasuda Life Insurance

10%1■ Organization Chart■ Sponsors Support
Shareholder’s Meeting
Auditorsno.

Summary of sponsors support

1

Personnel support through dispatching personnel to TRIM
and other measures

2

Provision of know-how on real estate management ingeneral, including tenant leasing and technical support

3

Supply of properties and provision on information onproperty acquisition

4

Fund procurement support including funding through debt
finance

Board of Directors
President & CEO
Investment Committee

Compliance Committee
Compliance Office

Investment Management Division

Financial DivisionCorporate Planning /Administration Division

Research Grp.

Financial Grp.

Planning Grp.

Investment Grp.

IR Grp.

General Administration Grp.

Asset Management 1Grp.

Fund Management Grp.

Asset Management 2Grp.
Asset Management 3Grp.

Asset Engineering Grp.

45

4. Appendix

Office Property Leasing Market

Net Increase in Leasable Floor Area, Strong Demand and Impact on Vacancy Rate
■ Changes in New Supply/Demand Area, Leasable Floor Area and Vacancy Rate

Comparison of increases in new supply area and leasable floor area

( Tokyo CBDs )• Net increase in leasable floor area (in stock) over the new supply area is small.

+400

Up 2.11 mn. tsubo• Employed population is on an upward trend, leading new demand in Tokyo.
Increase in labor participation ratio, primarily by females and elderly people, ispromoted by political initiatives and is likely to continue over the medium term.
(thousand tsubo)300

Net increase in leasable
floor area

New supply

New demand

Anount of increase in new supply area
Amount of increase in leasable floor area

（10 thousand tsubo）• New demand has remained strong, surpassing the increase in leasable floor area by
volume+200

Up 0.92 mn. tsubo

Vacancy rate

+0'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 (year)

(%)

15

(Vacancy rate: right axis, Others: left axis, New supply and new demandindicate actual number)Comparison of increases in leasable floor area and occupied area
Net increase in leasable floor
Increase in occupied area

（10 thousand tsubo）

2002 - 2017
Average of new supply
200

2018 - 2022
Average of new supply

8.67

10

+200

Up 1.08 mn. tsubo

+150
+100

Up 0.92 mn. tsubo

+50

7.34

+0
'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 (year)

5.47
100

4.03

5

3.61
3.12

Comparison of employed population and occupied area (’05=100pt)(pt)

Employed population

130

0

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

0

2022 (year)(forecast)(forecast) (forecast)(forecast) (forecast)
1. Actual results of the vacancy rate, leasable floor area and occupied area through December 2017 are based on the Office Report (Tokyo CBDs) by Miki Shoji Co., Ltd. New
supply, new demand and loss areas as well as the leasable floor area and vacancy rate in 2018 and thereafter have been estimated based on surveys and simulations
conducted by market research agency and TRIM.
As an assumption for the simulation, the new supply area uses an estimate obtained by applying a certain multiplying factor to the average of the past results. The lost area isbased on the average of the past results as assumption.
2. The employed population was prepared by TRIM based on the Labor Force Survey, the Ministry of Internal Affairs and Communications.

Male

FemaleOccupied area

128pt

120

119pt

110

115pt
113pt

100

’05

’06

’07

’08

’09

’10

’11

’12

’13

’14

’15

’16

’17 (year)46

4. Appendix

For-Sale Office Property Market

Cap Rate of Tokyo Office Properties Continues to Drop
■ Correlation between Price and Rent of Grade A Office Properties in Tokyo■ Cap Rates of Office Properties in Tokyo

Grade A office properties(%)

Grade B office properties

Rent index(pt・’02Q1=100)

Price index

300

6.0
5.5

250
5.0
200

4.5

Price index up 69.8pt

Last peak for grade B officeproperties

4.0

150
Last peak for grade A officeproperties

100'17 Q4up 18.9pt'17 Q1'14 Q4'14 Q1'13 Q2'12 Q3'11 Q4'11 Q1'10 Q2'09 Q3'08 Q4'08 Q1'07 Q2'06 Q3'05 Q4'04 Q2'05 Q1'03 Q3'02 Q4500'02 Q1'18 Q1'17 Q3'17 Q1'16 Q3'16 Q1'15 Q3'15 Q1'14 Q3'14 Q1'13 Q3'13 Q1'12 Q3'12 Q1'11 Q3'11 Q1'10 Q3'10 Q1'09 Q3'09 Q1'08 Q3'08 Q1'07 Q3

2.50'07 Q1

Rent index'16 Q2

3.0'15 Q33.5

1. Prepared by TRIM based on reports publicized by Jones Lang LaSalle K.K

47

4. Appendix

Unitholders (as of June 30, 2018)■ Number of Units by Unitholder Type (923,000 units in total)

Securities
companies
23,653
2%■ Top Unitholders

Individuals
35,6224%Foreigninvestors
223,176
24%

NameFinancial
institutions
559,172
61%
Of which, investment
Trusts incorporating
JPR units
285,170
31%

Other domestic
corporation
81,377
9%■ Number of Unitholders by Unitholder Type (11,647 unitholders in total)
Foreign investors
430
Other domestic
4%
corporations
206
2%

Securities
companies
24
0%

Financial
institutions
183
2%

Number of
Owned
Share (%)
Units

1Japan Trustee Services Bank, Ltd. (Trust Account)

217,441

23.6

2

The Master Trust Bank of Japan, Ltd. (Trust Account)

113,591

12.3

3

The Nomura Trust and Banking Co., Ltd. (Investment
Trust Account)37,062

4.0

4Tokyo Tatemono Co., Ltd.

29,3003.2

5State Street Bank West Client Treaty 505234

28,881

3.1

6

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

25,551

2.8

7Kawasaki Gakuen

25,0002.7

8

Meiji Yasuda Life Insurance Company

24,0002.6

9Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.

18,2982.0

10State Street Bank West Pension Fund Clients Exempt 505233

13,828

1.5

Total

532,952

57.7

Individuals
10,80493%

48

4. Appendix

Investment Unit Price and Yield■ Changes in JPR Unit Price and Dividend Yield(yen)

Unit Price

Dividend Yield(%)

500,000

4.5

450,000

4.0

400,000

3.5

350,000

3.0

300,000
0
Dec '15

Mar '16

Jun '16

Sep '16

Dec '16

Mar '17

Jun '17

Sep '17

Dec '17

Mar '18

2.50
Jun '18

1. Prepared by TRIM based on Bloomberg data.

49

4. Appendix

Portfolio Map■Central Tokyo

Shinjuku

Ichigaya

A-12
A-14

A-17

A-4

SaitamaPrefecture

A-5

A-9
A-24

B-5

Musashiurawa

A-20

A-4

B-6

A-3

Chiyoda Ward

B-1

Tokyo

A-1

A-26

A-2
A-13

Shibuya Ward

A-5

Harajuku

A-22

B-7

Olinas Tower
Tokyo Tatemono Yokohama Building

B-13

Omiya Prime East

B-1

Tanashi ASTA

B-3

Cupo-la Main Bldg.

B-4

JPR Musashikosugi Bldg.

Yokohama

B-5

Musashiurawa Shopping Square

B-3

B-6

Kawasaki Dice Bldg.

C-12

Sompo Japan Sendai Bldg.

C-1

Niigata Ekinan Center Bldg.

C-19

J PR Nagoya Fushimi Bldg.

C-9

JPR Naha Bldg.

Kawasaki

B-6

B-5

A-15

Shin-Yokohama
B-12

Tamachi
B-10

Tachikawa Business Center Bldg.

B-12

B-4

Kanagawa
Prefecture

Hamamatsucho

JPR Ueno East Bldg.

B-8

Chiba

Musashikosugi

A-25

Kawaguchi Center Bldg.

B-7

B-11

Shibuya
Shinagawa

Chuo Ward

Shibuya

Shinyokohama 2nd Center Bldg.

B-6

Rise Arena Bldg.

Tokyo

Minato WardJPR Yokohama Nihon Odori Bldg.

B-5

Yume-ooka Office Tower

Kinshicho

B-2
A-18

JPR Chiba Bldg.

B-3

B-10

Tokyo

A-3

A-1

Arca East

B-2

B-9

B-1

A-6

Shinbashi

B-1

B-11

Ikebukuro
Shinjuku

Tachikawa

A-19

B-9

Tanashi

B-8

Chiba
Prefecture

B-3

Kawaguchi

A-23

A-21

All other areas of Tokyo, Chiba, Kanagawa
and Saitama Prefectures

B-13

Omiya

A-7

Shinjuku Ward
A-11

■Greater Tokyo

Chiyoda, Chuo, Minato, Shinjuku, Shinagawa
and Shibuya Wards

KamiokaA-6■Other Cities
GotandaShinagawa

A-7
A-16
A-10

OhsakiShinagawa Ward

C-4

Tokyo Tatemono Honmachi Bldg.

C-17

JPR Dojima Bldg.

C-21

JPR Shinsaibashi Bldg.

C-1

JPR Umeda Loft Bldg.

C-5

JPR Chayamachi Bldg.
SendaiA-1

Kanematsu Bldg.

A-13

Across Shinkawa Bldg. Annex

A-24

Science Plaza - Yonbancho Plaza

A-2

Kanematsu Bldg. Annex

A-14

Shinjuku Center Building

A-25

Shibadaimon Center Bldg.

A-3

JPR Ningyo-cho Bldg.

A-15

Minami Azabu Bldg.

A-26

Tokyo Square Garden

A-4

Shin-Kojimachi Bldg.

A-16

Shinagawa Canal Bldg.

A-1

JPR Shibuya Tower Records Bldg.

A-5

JPR Crest Takebashi Bldg.

A-17

Rokubancho Building

A-3

JPR Jingumae 432

A-6

MS Shibaura Bldg.

A-18

JPR Harajuku Bldg.

A-4

Shinjuku Sanchome East Bldg.

A-7

Gotanda First Bldg.

A-19

Tokyo Tatemono Kyobashi Building

A-5

Yurakucho Ekimae Building (Yurakucho Itocia)

A-9

JPR Ichigaya Bldg.

A-20

JPR Nihonbashi-horidome Building

A-6

JPR Ginza Namiki-dori Building

A-10

Oval Court Ohsaki Mark West

A-21

JPR Sendagaya Bldg.

A-7

FUNDES Suidobashi

A-11

Shinjuku Square Tower

A-22

Ginza Sanwa Bldg.

A-12

BYGS Shinjuku Bldg.

A-23

The Otemachi Tower (Land with Leasehold Interest)

C-7

JPR Hakata Bldg.

C-14

Tenjin 121 Bldg.

C-20

Yakuin Business Garden

Niigata

NagoyaKobe

Fukuoka

Osaka
Wakayama
Naha

C-4

Housing Design Center Kobe

C-13

Sompo Japan Wakayama Bldg.

50

4. Appendix

Portfolio List (Central Tokyo)

A－1 Kanematsu Bldg.

A－2 Kanematsu Bldg. Annex

A－3 JPR Ningyo-cho Bldg.

A－4 Shin-Kojimachi Bldg.

① Chuo-ku① Chuo-ku① Chuo-ku① Chiyoda-ku② S・RC・SRC B2/13F② SRC B1/8F② SRC・RC B1/8F② SRC B1/9F③ Feb. 1993

③ Feb. 1993

③ Dec. 1989

③ Oct. 1984

④ 14,995m2④ 4,351m2④ 4,117m2④ 5,152m2

A－5 JPR Crest Takebashi Bldg.

A－6 MS Shibaura Bldg.

A－7 Gotanda First Bldg.

A－23 The Otemachi Tower (Land with Leasehold Interest)

A－9 JPR Ichigaya Bldg.

① Chiyoda-ku① Minato-ku① Shinagawa-ku① Chiyoda-ku② SRC B1/9F② SRC・RC・S B2/13F② SRC・RC B2/11F② SRC B1/9F③ Sep. 1999

③ Feb. 1988

③ Jul. 1989

③ Mar. 1989

④ 4,790m2④ 31,020m2④ 10,553m2④ 5,888m2① Chiyoda-ku②－③ Apr. 2014
11,034㎡④(ground area)

A－14 Shinjuku Center Building

A－10 Oval Court Ohsaki Mark West

A－11 Shinjuku Square Tower

A－12 BYGS Shinjuku Bldg.

A－13 Across Shinkawa Bldg. Annex① Shinagawa-ku① Shinjuku-ku① Shinjuku-ku① Chuo-ku② S・SRC B2/17F② S・RC・SRC B4/30F② SRC B2/14F② S・SRC B2/10F③ Jun. 2001

③ Oct. 1994
78,796m2 (entire④
redevelopment area)③ Apr. 1985

③ Jun. 1994

④ 25,733m2④ 5,535m2④ 28,575m2

A－15 Minami Azabu Bldg.

A－16 Shinagawa Canal Bldg.

A－17 Rokubancho Building

A－18 JPR Harajuku Bldg.

① Minato-ku① Minato-ku① Chiyoda-ku① Shibuya-ku② S 9F② S B1/8F② SRC B3/7F② SRC B1/9F③ Jun. 1992

③ Jul. 2008

③ Oct. 1991

③ Mar. 1989

④ 4,570m2④ 5,216m2④ 4,205m2④ 6,466m2① Shinjuku-ku② SRC・RC・S B5/54F③ Oct. 1979
④ 176,607m2
1. The property overview indicates (1) location, (2) structure/floors, (3) completion, and (4) total floor space (entire building). The same applies hereafter.

51

4. Appendix

Portfolio List (Central Tokyo)

A－19 Tokyo Tatemono Kyobashi Building

A－20 JPR Nihonbashi-horidome Building

A－21 JPR Sendagaya Bldg.

① Chuo-ku① Chuo-ku① Shibuya-ku② SRC B1/10F② SRC B1/9F② S 8F③ Jan. 1981

③ Jun. 2002

③ May 2009

④ 4,419m2④ 7,190m2④ 7,683m2

A－22 Ginza Sanwa Bldg.

A－24 Science Plaza - Yonbancho Plaza

Aｰ26 Tokyo Square Garden

A－25 Shibadaimon Center Bldg.

① Chuo-ku① Chiyoda-ku① Minato-ku② SRC B2/9F② S・SRC・RC B2/12F② S・SRC B1/10F③ Oct. 1982

③ Feb. 1995

③ Jul. 1993

④ 8,851m2④ 24,560m2④ 11,419m2① Chuo-ku② SRC B4/24F③ Feb. 2013
④ 112,645㎡
A－1 JPR Shibuya Tower Records Bldg.

A－4 Shinjuku Sanchome East Bldg.

A－3 JPR Jingumae 432① Shibuya-ku① Shinjuku-ku② S・SRC B1/7F② S・SRC・RC B3/14F③ Feb. 2006

③ Jan. 2007

④ 1,066m2④ 24,617m2

A－5 Yurakucho Ekimae Building (Yurakucho Itocia)① Chiyoda-ku② S・SRC B4/20F③ Oct. 2007
④ 71,957m2① Shibuya-ku② SRC・S B3/8F③ Feb. 1992
④ 8,449m2

Aｰ6 JPR Ginza Namiki-dori Building

Aｰ7 FUNDES Suidobashi①Chiyoda-ku②S 9F③Jul. 2015
④1,477㎡① Chuo-ku② S 11F③Jun. 2008
④ 1,821㎡

The name of the Ginza Gates was changed
to JPR Ginza Namiki-dori Bldg. as of Aug. 1,
2018.

52

4. Appendix

Portfolio List (Greater Tokyo)

B－1 Arca East

B－2 JPR Chiba Bldg.

B－3 JPR Yokohama Nihon Odori Bldg.

① Sumida-ku① Chiba, Chiba② S・SRC B3/19F② S・SRC B1/13F③ Mar. 1997

③ Jan. 1991

④ 34,281m2④ 9,072m2

B－11 Olinas Tower

B－7 JPR Ueno East Bldg.

B－5 Shinyokohama 2nd Center Bldg.

① Kawaguchi, Saitama① Yokohama, Kanagawa① Yokohama, Kanagawa② SRC B1/11F② S・SRC B2/12F③ Feb. 1994

③ Oct. 1989

③ Aug. 1991

④ 28,420m2④ 9,146m

2

B－8 Tachikawa Business Center Bldg.

④ 7,781m② S・SRC B2/15F

2

B－9 Rise Arena Bldg.

B－10 Yume-ooka Office Tower① Taito-ku① Tachikawa, Tokyo① Toshima-ku② S・SRC B1/8F② S・SRC B1/12F② RC・SRC・S B3/42F③ Oct. 1992

③ Dec. 1994

③ Jan. 2007

④ 8,490m2④ 14,706m2④ 91,280m

B-12 Tokyo Tatemono Yokohama Building

B－6 Kawaguchi Center Bldg.

2① Yokohama, Kanagawa② S・SRC・RC B3/27F③ Mar. 1997
④ 185,976m2

B－13 Omiya Prime East
① Saitama, Saitama① Yokohama, Kanagawa② S 9F② SRC B1/9F③ Feb. 2009

③ May 1981

④ 9,203m2④ 8,772m2① Sumida-ku② SRC・RC・S B2/45F③ Feb. 2006
④ 257,842m2

B－1 Tanashi ASTA

B－3 Cupo-la Main Bldg.

B－4 JPR Musashikosugi Bldg.

① Nishitokyo, Tokyo① Kawaguchi, Saitama② SRC B2/17F② S・RC・SRC B2/10F③ Feb. 1995

③ Jan. 2006

② SRC・RC・S B1/6F④ 80,675m2④ 48,321m2③ Mar. 1983

① Kawasaki, Kanagawa④ 18,394m2

B－5 Musashiurawa Shopping Square

B－6 Kawasaki Dice Bldg.

① Saitama, Saitama① Kawasaki, Kanagawa② S B1/4F② S・SRC・RC B2/11F③ Oct. 2005

③ Aug. 2003

④ 28,930m2④ 36,902m2

53

4. Appendix

Portfolio List (Other Cities)

C－1 Niigata Ekinan Center Bldg.

C－4 Tokyo Tatemono Honmachi Bldg.

① Niigata, Niigata

C－7 JPR Hakata Bldg.

① Osaka, OsakaC－9 JPR Naha Bldg.
① Fukuoka, Fukuoka② S・SRC B1/10F② SRC B3/9F② S・RC B1/12F, S1F③ Mar. 1996

③ Feb. 1970

③ Jun. 1985

④ 19,950m2④ 14,619m2④ 9,828m2

C－13 Sompo Japan Wakayama Bldg.

C－14 Tenjin 121 Bldg.

C－17 JPR Dojima Bldg.

C－12 Sompo Japan Sendai Bldg.
① Naha, Okinawa① Sendai, Miyagi② SRC・S 12F② SRC B1/12F③ Oct. 1991

③ Dec. 1997

④ 5,780m2④ 10,783m2

C－19 JPR Nagoya Fushimi Bldg.

Wakayama,①
Wakayama① Fukuoka, Fukuoka① Osaka, Osaka① Nagoya, Aichi② S 9F② S・SRC 13F② SRC B2/9F② SRC B1/9F③ Jul. 1996

③ Jul. 2000

③ Oct. 1993

③ Mar. 1991

④ 6,715m2④ 8,690m2④ 5,696m2④ 10,201m2

C－20 Yakuin Business Garden

C－3 JPR Shinsaibashi Bldg.
① Osaka, Osaka② S B2/10F③ Feb. 2003
④ 5,303m2① Fukuoka, Fukuoka

The name of the Benetton Shinsaibashi Bldg. waschanged to JPR Shinsaibashi Bldg. as of Aug. 1,
2018.

C－1 JPR Umeda Loft Bldg.

C－4 Housing Design Center Kobe

② SRC 14F
③ Jan. 2009
④ 22,286m2

C－5 JPR Chayamachi Bldg.

① Osaka, Osaka① Kobe, Hyogo① Osaka, Osaka② SRC B1/8F② SRC･S B2/11F② S・SRC 9F③ Apr. 1990

③ Jun. 1994

③ Jun. 1994

④ 17,897m2④ 33,877m2④ 3,219m2

54

4. Appendix

Introduction to the JPR Website http://www.jpr-reit.co.jp/

8955

Having expanded IR information by adding a variety of contents,
JPR provides information in a timely manner
Property Information• [Occupancy Rate]
Occupancy Rate: data for each property (Excel) updated
monthly• [Property Data Library]
Property Data Book, Property Appraisal Summary,
Historical Data
• [Portfolio data]
Asset class, Area, Ratio of Properties by Property
Acquisition Channel, Ratio of Tenant Occupancy• [Video Presentation of Major Properties]

Overview of Property・Access Map• [Property Overview]
Basic Information, Management Status, Major
Characteristics• [Access Map]
Search function for routes from the nearest
stations (applicable for mobile phones)• Other than these, latest topics regarding
management status are posted at any time

Information of initiatives on sustainability• Sustainability policy & management
・Initiatives on behalf of tenants
・Initiatives on behalf of the environment
・Local community initiatives
・Safety and security initiatives
・Initiatives aimed at employees
・Initiatives aimed at unitholders/investors
Extensive ESG related information
Regularly announce updated data55

5. Glossary

Term

Meaning

Acquisition price

The transaction price indicated in the sale and purchase agreement for acquisitionof properties (hereafter, the “owned properties”) or properties it plans to acquire(exclusive of expenses related to acquisition, property taxes and consumption taxes,
etc.)

Total (acquisition price)

The asset size refers to the total amount of the acquisition prices of the owned
properties.

Investment ratio

The investment ratio refers to the ratio of the acquisition price of relevant
properties owned by JPR to the total acquisition price of its portfolio.

Occupancy rate /occupancy rate based on
concluded contracts

Total leased space / total leasable space
When simply stated as occupancy rate, it represents the occupancy rate based on
concluded contracts.
When occupancy rate for each fiscal period is indicated, it represents the averageoccupancy rate as of the end of each month that belongs to the relevant fiscal
period (period average of occupancy rate at end of month). Furthermore, it may bedescribed as “average occupancy rate” in order to distinguish it from “period-end
occupancy rate.”

Occupancy rate based on
generated rents(Total leased space – total leased space during rent-free and rent-holiday periods) /total leasable space

Average unit rent

Total monthly rent / total leased space
Calculated based on the monthly rents (including common charges) indicated in thelease contracts with tenants; for certain properties, the figure includes common
charges, etc. received by master lessees without being recorded as JPR’s revenue

Average downtime

Term

Meaning

Gap in rents

Gap in rents refers to the ratio obtained by dividing the difference in the monthly amount(or the difference in the monthly amount after deducting the base rent from the ongoingrent for contracts to be renewed in the four fiscal periods through the 36th fiscal period
ending Dec. 2019, the difference in the monthly amount after deducting the rents that are
higher than the target rent (excluding new contract rents) from the rents that are lower thanthe base rent) by the monthly rent that serves as the calculation base.

NOI yield(Rental revenue - real estate － expenses related to rent business ＋ depreciation) /book value (or acquisition price, depending on the case)
NOI yield is calculated using the above formula, by dividing the book value (oracquisition price) in the formula by 365 days and multiplying it by the number ofbusiness days of the relevant fiscal period.

After-depreciation
yield(Rental revenue - real estate － expenses related to rent business) / book value (oracquisition price, depending on the case)Number of tenants

The number of tenants counts the parties with whom JPR has concluded lease
contracts for the building floors. When a single tenant leases multiple rooms, it iscounted as one if the tenant uses the same property. If the leased rooms are in
multiple buildings, the tenant is counted in plural.

Ratio of long-term,
fixed interest ratedebts

Long-term interest-bearing debts with fixed interests / total interest-bearing debts

Average maturity

Weighted average calculated by dividing the remaining periods to the repayment
dates and redemption dates of borrowings and investment corporation bonds at theend of each fiscal period by the balance of respective borrowings and investment
corporation bonds at the end of each fiscal period
For borrowings with scheduled repayment in installments, the weighted average ofthe remaining period to the scheduled repayment dates of each installment payment
in accordance with the relevant repayment amount

Average debt cost

Sum total of interest expenses on borrowings and investment corporation bonds,
borrowing expenses (excluding expenses for early repayment of borrowings and forcommitment line agreements), amortization of investment corporation bondissuance costs and issuance management expenses, divided by the number ofbusiness days for the relevant fiscal period and annualized by multiplying by 365 days
/ sum total of borrowings and investment corporation bonds

The average period of vacancy between the move-in dates stipulated in the new lease
contracts becoming effective in each fiscal period and the move-out days of the previous
tenants for the same leased spaces.

Average rent-free
periodThe average of the rent-free periods agreed upon in new lease contracts becoming
effective in each fiscal period.

Revised amount ofmonthly rent

Revised amount of monthly rent indicates the sum total (including common charges) ofmonthly rent after revision minus monthly rent before revision upon contract renewal withrent revision in each fiscal period. For the revised amount of monthly rent for the 34th
fiscal period (Dec. ‘18), the amount of increase is an estimate based on consents regarding
rents becoming effective in the fiscal period, and the amount of decrease is an estimate
assumed for the rents becoming effective in the fiscal period.

LTVInterest-bearing debts / total assets at end of period (based on total assets)
There are other calculation methods of LTV.
・LTV based on unitholders’ capital) = Interest-bearing debts / (interest-bearing debts+ unitholders’ capital)
・LTV (based on valuation) = Interest-bearing debts / (total assets at end of period +unrealized gains or losses from valuation)
Unrealized gains or losses from valuation refer to the difference between appraisal
value and book value.

Change amount inmonthly rent upontenant replacement

Change amount in monthly rent upon tenant replacement indicates the sum total(including common charges) of monthly rent after tenant replacement minus monthly rent
before tenant replacement in each fiscal period. The change amount of monthly rent upontenant replacement for the 34th fiscal period (Dec. ‘18) is an estimate based on consents
regarding move-ins/move-outs and rents becoming effective in the fiscal period.

NAV per unit

(Unitholders’ value + reserve for reduction entry, etc. + unrealized gains or losses) /number of units outstanding

The rent level JPR sets on its own in order to raise rents

Ratio of unrealized
gains or losses(Appraisal value – book value) / book value

Target rent
Base rent

Base rent refers to the rent level (the lowest limit) TRIM sets for each fiscal period as thebase for inviting new tenants and revising rents for existing tenants, and are set at roughly
the same level as market rent.

Cap rate

Gap in actual rents

Gap in actual rents refers to the ratio obtained by dividing the difference of monthly
amount (or, of the difference of monthly amount after deducting the target rent from theongoing rent for contracts to be renewed in the four fiscal periods through the 36th fiscal
period ended Dec. 2019, the difference of monthly amount after deducting the rents higher
than the target rent (excluding new contract rents) from the sum total of rents that arelower than the base rent and rents that are lower than the target rent but higher than thebase rent) by the monthly rent that serves as the calculation base.

Capitalization rate by the direct capitalization method
Direct capitalization method is one of the methods to calculate the value estimatedby income approach (a method to estimate the value of the target property by
calculating the sum total of present value of the net operating income which thetarget property is expected to generate in the future), and capitalizes the net
operating income of a certain period by using the capitalization rate.

Tokyo/ Other cities“Tokyo” defined by JPR as its investment area collectively refers to “Central Tokyo”
and “Greater Tokyo” as defined below, and “Other Cities” refers to other regions.
・Central Tokyo: Chiyoda, Chuo, Minato, Shinjuku, Shinagawa and Shibuya Wards
・Greater Tokyo: All other areas of Tokyo Prefecture, and Chiba, Kanagawa andSaitama Prefectures56