Fortieth Fiscal Period Semi-Annual Report
July 1, 2021−December 31, 2021

Japan Prime Realty Investment Corporation

Japan Prime Realty Investment Corporation

Message to Our Unitholders
Dear Unitholders,
We at Japan Prime Realty Investment Corporation (JPR) would like to express our sincere gratitude forthe continued loyal patronage you have extended to us.
Having settled the 40th fiscal period (July 1, 2021 – December 31, 2021), we would like to report on theperformance results.
The office property leasing market had remained on a somewhat stagnant note since 2020 under
the impact of the novel coronavirus (COVID-19) infection. However, since October 2021 when the
declaration of a state of emergency state was lifted, the number of inquiries for new leasing cases has
been increasing. This, together with the normalization of decision-making by companies, allows us tofeel that economic activities are recovering.
Under such circumstances, JPR conducted strategic asset replacement in the 40th fiscal period and, by
distributing part of the gain on sale of properties to unitholders, secured distribution per unit of 7,550
yen as forecasted without conducting reversal of internal reserves that it initially planned to do.
Going forward, while continuously paying close attention to the impact of COVID-19, we will flexibly
respond to changes in social conditions and endeavor achieving appropriate asset management to grasp
new opportunities for growth.
We ask you, our unitholders, to extend us continued support of our operations.

Operating Results
39th Period
ended
Jun. 2021
Results

40th Period
ended
Dec. 2021
Results

17,305

Operating income

ChangeChangeRate ofchange18,253

+948

+5.5%

8,789

8,626

-162

-1.9%

Ordinary income

8,121

7,893

-227

-2.8%

Net income

8,120

7,892

-227

-2.8%

Distribution per unit

7,657

7,550

-107

-1.4%

Operating revenue(million yen)(million yen)(million yen)(million yen)

(yen)

1

TOPIC 1
Operating revenue includes gain on sale of properties(783 million yen for the 39 fiscal period and 1,870
million yen for the 40th fiscal period).

TOPIC 2
Profits for rent business decreased period-on-period
due to the impact of COVID-19, etc., but are expected
to show a recovery trend in the 41st fiscal period andthereafter.
Furthermore, operating expenses for the 40th fiscal
period includes loss on sale of properties amounting
to 856 million yen.

TOPIC 3Distribution per unit came to 7,550 yen, as forecasted
at the beginning of the fiscal period.
Part of the gain on sale has been internally reserved forthe purpose of stable management and cash distributionsin the future.

Interview withTop Management
Yoshihiro Jozaki
Executive Officer, Japan Prime Realty Investment Corporation
President and Chief Executive Officer, Tokyo Realty Investment
Management, Inc.

Q1: Could you start by telling us about the situation of the office property leasing
market?

In the 40th fiscal period, our properties maintained occupancy at a level higher than the market, with theoccupancy rate of the entire portfolio standing at 96.9%.
The office property leasing market has remained on a somewhat stagnant note since 2020 under the impact of COVID-19.
But the rising vacancy rate in the business districts of Tokyo is calming down to show signs of bottoming out.
JPR has also seen progress made in the leasing of large-scale sections at such properties as Rise Arena Bldg. since
October 2021 when the declaration of a state of emergency was lifted. As such, we feel that office demand is on a
track to recovery along with the normalization of economic activities and decision-making by companies.
Changes in Occupancy Rate
Occupancy rate of entire portfolio (JPR)
Occupancy rate in the market (office in Tokyo)

(%)

100.0
99.2
98.0

98.3

99.5

99.6

98.5

98.0

99.4
98.2
97.5
96.9

96.0
95.5
94.0

92.0

35th Period(Jun. 2019)36th Period(Dec. 2019)37th Period(Jun. 2020)

38th Period(Dec. 2020)

93.8

93.7

39th Period(Jun. 2021)

40th Period(Dec. 2021)(Note 1) “Occupancy rate of the entire portfolio” indicates the period-average figures.
(Note 2) Prepared by the Asset Management Company based on the “Office Report (Tokyo CBDs)” published by Miki Shoji Co., Ltd.

2

41st Period(Jun. 2022)(forecast)Japan Prime Realty Investment Corporation

Q2: With regard to the impact of COVID-19, how have your retail properties been affected?
JPR has provided support for business continuity to the tenants who suffered from sales declines caused by thestate of emergency declarations, etc., comprehensively considering the requests from relevant government agencies
and the impact on its future asset management.
In the 40th fiscal period, we continued to grant temporary rent reductions for certain retail tenants, but the amountof reductions conducted in the fiscal period was no more than 47 million yen, which was smaller than our initialassumption.
Because the ratio of restaurants and eateries in the entire retail properties of JPR is rather small at 3.1%, andhelped by the fact that we started providing support at a relatively early stage for the tenants suffering fromdecreased sales, the occupancy rate of our retail properties is kept at a high level.
Occupancy Rate Trends (retail properties)

Status of Temporary Rent Reductions

No. of cases

Amount37th Period

61

94 million yen

38th Period

41

45 million yen

39th Period

35

67 million yen

40th Period

20

47 million yen

(%)

100.0
99.9

100.0

100.0

100.0
99.3

99.5

(Jun. 2020)

98.0(Dec. 2020)

96.0(Jun. 2021)

94.0
35th Period 36th Period 37th Period 38th Period 39th Period 40th Period(Jun. 2019) (Dec. 2019) (Jun. 2020) (Dec. 2020) (Jun. 2021) (Dec. 2021)(Dec. 2021)

Q3: Could you explain the significance of the property replacements conducted in Octoberlast year and thereafter, and the public offering conducted in January this year?

Overview of Public Offering
Issuance
resolution date
Number of
new units issued
Total purchase
price

January 4, 2022

After issuance of new investment units[Unitholders' capital]

247.8 billion yen

38,928 units

261.7 billion yen[Number of units outstanding]

958,250 units

13.8 billion yen

997,178 units

There are three points on the significance of a series of initiatives we have taken since October last year.
The first is “acquisition of blue-chip properties and strategic asset replacement by utilizing sponsor pipelines.”
We procured 13.8 billion yen through the ninth public offering to fund the acquisition of GRAND FRONT OSAKA,
Tokyo Tatemono Higashi Shibuya Bldg. and additional ownership interest of Rise Arena Bldg. amounting to 39.9
billion yen in total.
Moreover, as part of our strategic asset replacement initiatives, we are selling JPR Umeda Loft Bldg. in stages
over three fiscal periods at a price surpassing its appraisal value by 25%, while selling Tokyo Tatemono Honmachi
Bldg., which had the oldest building age in our portfolio.
Through these asset replacement transactions, the asset size has expanded to 488.3 billion yen*, with the averagebuilding age lowered by 1.3 years*.

3

Japan Prime Realty Investment Corporation

The second point is “distribution of gain on sale to unitholders for three straight fiscal periods and enhanced
stability of cash distributions by expanding internal reserves.”
By selling JPR Umeda Loft Bldg. in stages, we are distributing the gain on sale to unitholders over three fiscal
periods.
Moreover, by internally reserving part of the gain on sale, the total amount of our internal reserve will be 4.19 billion
yen*, or 4,208 yen* per unit. This is a relatively high level among J-REITs, and should lead to enhanced stability of
future cash distributions.
The third point is “expansion of debt capacity for future acquisitions by lowering LTV.”
The public offering lowered our LTV (the ratio of interest-bearing debts to total assets) to 40.0%* and expanded our
debt capacity for acquisition to 46 billion yen* when the upper limit of LTV is set at 45.0%. With this, we successfully
reinforced our foundation for flexible property acquisitions toward the future.
* These figures are estimates at the time when the public oﬀering and a series of property transactions are completed.

Changes in the Balance of Internal Reserves (figures in parenthesis representing internal reserve per unit)

4.19 billion yen(4,208 yen)

3.34 billion yen(3,355 yen)

2.54 billion yen
1.88 billion yen(2,553 yen)

End of 39th Period(Jun. 2021)

End of 40th Period(Dec. 2021)(1,969 yen)

End of 41st Period(Jun. 2022)(forecast)End of 42nd Period(Dec. 2022)(forecast)

Changes in LTV (controlled at up to 45% as upper limit target)
(%)

45.0
44.0
43.0

Latest initiative

Immediately
precedingcapital increase

41.7

42.0
41.0

40.8

40.6

Latest capitalincrease

39.0
End of 36th
Period(Dec. 2019)

End of 37th
Period(Jun. 2020)

46.0 billion yen

40.6

39.5

40.0

Debt capacity
for acquisition

End of 38th
Period(Dec. 2020)

End of 39th
Period(Jun. 2021)

GRAND FRONT OSAKA

End of 40th
Period(Dec. 2021)

40.0
After the latest
initiative

Tokyo Tatemono Higashi Shibuya Bldg. Rise Arena Bldg.

4

Japan Prime Realty Investment Corporation

Q4: Can you tell us about your future growth strategies and cash distributions?
For the moment, internal growth will have to face a slowdown through revision of rents, etc. Because of this andother factors, we need to shift our focus of growth toward external growth through property acquisitions.
Utilizing the property acquisition capacity that has expanded through the latest public offering as a foothold, wewould like to achieve continuous growth going forward while taking advantage of the abundant pipelines centeringon Tokyo Tatemono, our main sponsor.
As for cash distributions, we will continue to secure a stable level of returns to our unitholders. As we do so, wewill also utilize our internal reserves that have been expanded.
In addition, by conducting additional property acquisitions and increasing the occupancy rate going forward, we will
aim to achieve distribution per unit of 7,800 yen, one of our medium-term targets, as soon as possible.

Q5: What are your sustainability initiatives?
On top of the global spread of COVID-19, extensive natural disasters due to abnormal climate are occurring
frequently.
Given such an environment, initiatives on sustainability are increasingly important.
JPR set out a goal of “achieving net zero CO2 emission by 2050” last August.
While we have steadily conducted works for better energy efficiency, including replacement of air-conditioning
units and replacement of lighting equipment with LED lamps since before, we started full-on introduction of 100%
renewable energy-based power supply in January 2022. As such, we are further reinforcing our endeavors towardachieving the goal.
We recognize that seriously facing and addressing social issues can lead to creation of new values and business
opportunities for our continuous growth. Based on this recognition, we are resolved to make proactive endeavors by
positioning initiatives on sustainability as the most important business issue.

5Japan Prime Realty Investment Corporation

Initiatives on Sustainability
Sustainability Policy
JPR is resolved to contribute to the sustainable development of the society and the investment management businessthrough discussion and cooperation with its stakeholders (including investors and tenants), and aims to maximize
value for its unitholders. Tokyo Realty Investment Management, Inc. (TRIM), the asset management company of
JPR, has established the Sustainability Policy that governs its initiatives to enhance sustainability of the society.

1. Initiatives on Behalf of Tenants
Respond to tenants with integrity and responsibility, and endeavor to provide them with new and distinct value
as well as enhance their satisfaction.

2. Initiatives on Behalf of the Environment
Aim to reduce environmental footprint through managing the assets JPR owns, in recognition of the importanceof addressing environmental issues.
❚ Promote energy saving and reduction of greenhouse gas emissions.
❚ Work on effective use of water resources and promote "3Rs" (reuse, reduce and recycle) of waste.
❚ Strive to proactively disclose information on environmental issues.

3. Initiatives on Behalf of Local Communities
Work to coordinate with local communities through managing the assets JPR owns in the area, in an effort tocontribute to enhancing the brand value of the entire area.

4. Initiatives on Behalf of Employees
Respect each one of the employees and promote realization of a pleasant work environment by helping themenhance their professional expertise.

5. Initiatives on Behalf of the Society
Abide by laws and regulations as well as rules of the society and, with a high ethical perspective, focus ontransparency and objectivity in conducting business.

Initiatives on Behalf of Major Stakeholders
Based on the Sustainability Policy, JPR is proactively implementing initiatives for a variety of its stakeholders.
The following chart provides JPR’s initiatives for major stakeholders.
●

Proactively disclose information on ESG
and other issues●●

Enhance tenant satisfaction
Provide safe, secure and comfortable working
environment●

Promote discussions with investors●

Maintain a strong corporate governance system●

Strengthen resilience●

Reinforce the risk management structure●

Contribute to communities in neighboring areas

●

●

●

●

Investors

Tenants/
local communities

Employees

Environment/
business partners

Foster professionals●

Promote physical andmental health and achieve work-life balance
Promote diversity
Prepare an environment that allows employees
to exert their potential●

Reduce CO2 emissions and waste, etc.

●

Conduct works for better energy efficiency●

6

Acquire environmental certifications and obtainhigher assessments

Thoroughly implement due diligence onhuman rights

Japan Prime Realty Investment Corporation

Initiatives on Environmental Friendliness■ Toward Achieving the Goal of Net-Zero CO2 Emission
Among the first to set up a goal of achieving net-zero CO2 emission by 2050, JPR is taking various initiatives toreduce emissions. In the endeavor, JPR periodically reviews its feasible measures for emission reduction and islooking for more effective measures. The measures currently underway and to be taken in the future are as follows.
(t-CO2)

Conduct works for better energy efficiency, including replacement of lighting with LED lamps
Switch to power from 100% renewable energy
sources (RE100) at 100%-owned properties

Adopt power from 100% renewable energy
source at co-owned and sectionally-owned properties

Thoroughly conduct waste recycling
Request business partners to pursue net- zero emission

CO2 emissions

Promote use of recycled materials and wood materials
Adopt such new technologies as storage batteries

2017

2030

2050

■ Status of Acquisition of Environmental Certifications
As part of the measures to enhance the quality of its portfolio, JPR works to obtain sustainability certifications.
JPR expects its goal of “80% for the ratio of properties having acquired environmental certifications by 2030” tobe achieved this year ahead of schedule. Going forward, JPR will promote the building of a portfolio that has evenhigher environmental performance.
Assessment in CASBEE for
Building Certification (Note 1)

(%)

90

★★★★★

Goal for 2030: 80%

80

71.4

70

74.3

★★★★
★★★

65.5
60.1

60

53.4

DBJ Green Building Certification (Note 2)

54.4

★★★★★
★★★★

50

★★★
★★

40
34.0

30
20

2 properties
4 properties
7 properties
2 properties

BELS Certification (Note 3)

34th Period 35th Period 36th Period 37th Period 38th Period 39th Period 40th Period 41st Period 42nd Period(Dec. 2018) (Jun. 2019) (Dec. 2019) (Jun. 2020) (Dec. 2020) (Jun. 2021) (Dec. 2021) (Jun. 2022) (Dec. 2022)(planned)(planned)(Note 1)

13 properties
14 properties
1 property★★★
★★

1 property
1 property

CASBEE, which stands for Comprehensive Assessment System for Built Environment Efficiency, is a system for comprehensively assessing the environmental
performance of buildings. Efforts to develop and popularize the system in Japan are being made under the leadership of the Ministry of Land, Infrastructure, Transport
and Tourism. The system comprehensively assesses the environmental quality of buildings, including indoor comfort and consideration for the landscape, on top of
the aspect of environmental consideration such as energy saving and the use of materials and equipment with a lower environmental burden.

(Note 2)

The DBJ Green Building Certification is a certification system to select superior real estate that meets the demand of the times by scoring buildings based on thescoring model originally developed by Development Bank of Japan Inc (DBJ). Its purpose is to promote properties that are environmentally friendly, equipped tomitigate disaster and prevent crime, as well as meet the social requirements surrounding real estate from various stakeholders (“Green Buildings”). The assessment
results are indicated in five ranks.

(Note 3)

BELS is an abbreviation for Building-Housing Energy-efficiency Labeling System. It is a performance labeling system created for the purpose that a third-party
organization accurately conducts the evaluation and indication of energy efficiency performance of non-residential buildings in accordance with the Assessment
Guidelines on Energy Efficiency Performance of Nonresidential Buildings (2013) established by the Ministry of Land, Infrastructure, Transport and Tourism. Third-party
organizations assess energy-saving performance, etc. based on a variety of measurement criteria, indicating the results by the number of stars ( ★ to ★★★★★ ).

7

Japan Prime Realty Investment Corporation

Recognition by External Bodies and Initiatives
JPR and TRIM were quick to announce participation in external assessment systems and won high recognition byappropriately responding to what have been pointed out. JPR and TRIM also announced support for international
initiatives to contribute to addressing such social issues as climate change.

2021 GRESB Real Estate Assessment
GRESB is a benchmarking assessment to measure ESG awareness of realestate companies and funds, as well as the name of organization which runs
the assessment system.
JPR was designated as “Green Star” in the GRESB Real Estate Assessment
for 2021, marking the eighth consecutive year of recognition with the rank,
and was also granted the highest rank of “5 Stars” in the GRESB Rating forthree consecutive years.

Inclusion in the MSCI Japan ESG Select Leaders Index (Note 4)
In May 2021, JPR was included in the MSCI Japan ESG Select Leaders
Index provided by MSCI. The Index comprises selected corporations with

2021 CONSTITUENT MSCI JAPANESG SELECT LEADERS INDEX

excellent ESG performance, and has been chosen as one of the indexes for
asset management by Japan’s Government Pension Investment Fund (GPIF).

Participation in CDP
CDP is an international non-profit organization representing global
institutional investors highly interested in environmental issues, and assesses
the environmental initiatives of over 13,000 companies and discloses theassessment results. The assessment is made through questions that cover
many items including governance, risk management and business strategies,
and is granted in eight ranks. JPR obtained “B” in the 2021 assessment.

Signing of PRI (Principles for Responsible Investment)

Support for TCFD

The Principles for Responsible Investment (PRI) is an

In May 2021, TRIM announced its support for theinternational network of investors for achieving the six

recommendations of the Task Force on Climate-related

principles. In agreement with PRI, TRIM became a

Financial Disclosures (TCFD), which was established bysignatory to it in May 2019.

the Financial Stability Board.

(Note 4)The inclusion of JPR in any MSCI index, and the use of MSCI logos, trademarks, service marks or index names in notices thereof, do not constitute a sponsorship, endorsement
or promotion of JPR by MSCI or any of its affiliates. The MSCI indexes are the exclusive property of MSCI. MSCI and the MSCI index names and logos are trademarks or service
marks of MSCI or its affiliates.

8Asset Management ReportJapan Prime Realty Investment Corporation

1. Overview
1. OverviewofofAsset
AssetManagement
Management(1) (1)
Changesin inOperating
Data
Changes
OperatingResults
Resultsand
andOther
Other Management
Management Data

2.

Operating Revenue
Rent revenue – real estate

Million yen

36th Fiscal
Period(Jul. 1, 2019 Dec. 31, 2019)
16,005

Million yen

16,005

16,363

16,714

16,521

16,382Gain on sale of real estate

Million yen

–

–

414

783

1,870

Million yen

8,320

8,350

8,596

8,515

9,626

Million yen

7,538

7,436

7,611

7,499

7,731

Million yen

7,684

8,013

8,533

8,789

8,626

Million yen

6,915

7,277

7,840

8,121

7,893

Reference
Information

Financial Indices

Cash Distribution per
Unit, etc.

Assets, etc.

Operating Performance

Fiscal Period

Operating Expenses
Expenses related to rent business
Operating Income
Ordinary Income
Net Income
Total Assets(Period-on-period variation)
Interest-bearing Debts
Total Unitholders’ Equity(Period-on-period variation)
Unitholders' Capital
Total Cash Distributions
Dividend payout ratio
Number of Units Outstanding
Total Unitholders' Equity per Unit
Cash Distribution per Unit
Distribution amountExceeding profit distribution amount
Ordinary Income on Total Assets (Note 1)
Annualized (Note 10)
Net Income on Total Unitholders'Equity (Note 2)
Annualized (Note 10)
Total unitholders' equity at
beginning of period
Unitholders' Equity Ratio at End of
Period (Note 3)(Period-on-period variation)
Interest-bearing Debts to Total Assets at
End of Period (Note 4)
DSCR (Note 5)
Net income before interest andamortization (Note 6)
Interest expenses
NOI from Leasing (Note 7)
Annualized NOI yield(Notes 9 and 10)
NCF from Leasing (Note 8)
Annualized NCF yield(Notes 9 and 10)
Investment Properties Owned (Note 11)
Number of Tenants
Total Leasable Floor Space (Note 12)
Occupancy Rate

Unit

37th Fiscal
Period(Jan. 1, 2020 Jun. 30, 2020)
16,36338th Fiscal
Period(Jul. 1, 2020 Dec. 31, 2020)
17,12939th Fiscal
Period(Jan. 1, 2021 Jun. 30, 2021)
17,30540th Fiscal
Period(Jul. 1, 2021 Dec. 31, 2021)
18,253

Million yen

6,914

7,276

7,839

8,120

7,892

Million yen

453,467

473,186

484,573484,323495,615(+0.2)(+4.3)(+2.4)(-0.1)(+2.3)

Million yen%

185,020

187,020

196,520

196,500

206,900

Million yen

239,269

255,838

256,399

257,093257,649(+0.0)(+6.9)(+0.2)(+0.3)(+0.2)

Million yen

231,653

247,860

247,860

247,860

247,860

Million yen

6,916

7,277

7,426

7,337

7,234

%

100.0

100.0

94.7

90.3

91.6

Units

923,000

958,250

958,250

958,250

958,250

Yen

259,230

266,984

267,570

268,295

268,875

Yen

7,493

7,595

7,750

7,657

7,550

Yen

7,493

7,595

7,750

7,657

7,550

%

Yen

–

–

–

–

–

%

1.5

1.6

1.6

1.7

1.6

%

3.0

3.2

3.2

3.4

3.2

%

2.9

2.9

3.1

3.2

3.1

%

5.7

5.9

6.1

6.4

6.1

239,166

239,269

255,838

256,399

257,093

%

52.8

54.1

52.9

53.1

52.0

pt

(-0.1)(+1.3)(-1.2)(+0.2)(-1.1)

%

40.8

39.5

40.6

40.6

41.7

Times

13.2

14.1

14.6

14.6

13.8

Million yen

9,620

10,015

10,208

10,132

9,708

Million yen

Million yen

731

710

697

694

701

Million yen

10,441

10,954

11,188

11,121

10,779

%

4.7

4.8

4.7

4.8

4.3

Million yen

8,858

9,574

9,534

9,751

9,177

%

4.0

4.2

4.0

4.2

3.7

63

65

66

65

66

760

851

857

804

1,134

m2

480,284.17

499,269.77

501,162.78

496,876.92

500,628.05

%

99.6

99.7

99.3

98.1

97.3

(Note 1) Ordinary income / (total assets at beginning of period + total assets at end of period) / 2(Note 2) Net income / (total unitholders' equity at beginning of period + total unitholders' equity at end of period) / 2(Note 3) Total unitholders' equity at end of period / total assets at end of period x 100(Note 4) Interest-bearing debts at end of period / total assets at end of period x 100(Note 5) Net income before interest and amortization / interest expenses (including interest expenses on investment corporation bonds)(Note 6) Income before income taxes - gain on sale of real estate + loss on sale of real estate + extraordinary loss + interest expenses (including interest expenses oninvestment corporation bonds) + depreciation(Note 7) (Real estate rental revenues - real estate rental expenses) + depreciation(Note 8) NOI from leasing - capital expenditures

91

Asset Management ReportJapan Prime Realty Investment Corporation(Note 9) Annualized NOI from leasing / property acquisition price (36th fiscal period: ¥439.52 billion, 37th fiscal period: ¥457.14 billion, 38th fiscal period: ¥468.54 billion,
39th fiscal period: ¥467.52 billion and 40th fiscal period: ¥494.23 billion)
Annualized NCF from leasing / property acquisition price(Note 10) Annualization is based on 365 days for a year and calculated by using the following management days: 36th fiscal period: 184 days, 37th fiscal period: 182 days,
38th fiscal period: 184 days, 39th fiscal period: 181 days and 40th fiscal period: 184 days.
(Note 11) Properties acquired at multiple times are calculated as one property.
(Note 12) Total leasable floor space in this table indicates the contracted area.
(Note 13) Any ratio indicated on financial indices is rounded to the first decimal place (except for the dividend payout ratio, which is rounded down to the first decimal place).

40thFiscal
FiscalPeriod
PeriodAsset
Asset Management
Management(2)(2)
40th

3.

1) Milestones of JPR
Japan Prime Realty Investment Corporation (JPR) was established on September 14, 2001 under the Act on Investment Trusts andInvestment Corporations (hereafter, the Investment Trusts Act), and was listed on the Tokyo Stock Exchange Real Estate Investment
Trust Section (securities code: 8955) on June 14, 2002 with 289,600 outstanding investment units. With the subsequently
implemented public offerings and other capital raising measures by JPR, the number of investment units issued and outstanding
totals 958,250 units as of the end of the 40th fiscal period (December 31, 2021). JPR has assigned the asset management of its
portfolio to Tokyo Realty Investment Management, Inc. (hereafter, the Asset Manager), through which JPR aims to maximize
unitholder value by efficiently managing the portfolio primarily comprising office properties and retail properties.
2) Management Environment
During the 40th fiscal period, the Japanese economy had remained in a severe situation due to the impact of COVID-19. A pickup
trend was observed, however, as economic and social activities recovered increasingly, with progress made in vaccinations to help
decrease the number of cases and the state of emergency declarations, etc., which had been issued nationwide against the pandemic,
lifted. On the demand side, consumer spending showed a trend for recovery, while in terms of supply, production was recovering
after temporary stagnancy due to global shortage of semiconductors, etc. Corporate earnings demonstrated recovery, mainly withinmanufacturing industries, and the non-manufacturing sector was also on a recovery path after some delay. Overseas economies also
continued to show pickup amid a severe situation. In spite of these developments, however, with a new variant of COVID-19
starting to spread both in and outside Japan toward the end of the fiscal period under review, there are concerns about the negative
impact on the economy.
The Office Property Leasing Market
In the office property leasing market, the occupancy rate and rent levels showed a downward trend, primarily in Central Tokyo,
under the impact of COVID-19. Reflecting the recovery in the domestic economy and corporate earnings, however, the decreasein the occupancy rate is decelerating in the market.
The Retail Property Leasing Market
At urban retail properties which JPR targets for investment, restaurants and eateries were negatively impacted by the state-ofemergency declarations, etc. that had been issued nationwide against COVID-19. Demand is recovering, however, as the state-ofemergency declarations were lifted throughout Japan.
The For-Sale Real Estate Market
In the for-sale real estate market, active transactions continued to take place against the backdrop of low interest rates, etc. Investors
keep showing a cautious attitude, however, for hotels and urban retail properties for which the outlook is still uncertain due to theimpact of COVID-19. For office properties, on the other hand, blue-chip properties in which JPR targets for investment are in short
supply while investors both in and outside Japan still demonstrate a strong appetite to acquire them. Thus, with low-yieldtransactions continuing to prevail, the acquisition environment remains harsh. Accordingly, investors continue to look for ways toeffectively acquire properties, such as by diversifying the target assets for investment and conducting asset replacement.
3) Portfolio Management Status
Acquisition of New Properties and Asset Replacement
JPR investigates possible investments mainly in office properties in the Tokyo area, plus office properties in regional cities andretail properties, etc., with the primary aim of improving the quality of the portfolio and achieving stable growth of earnings while
giving attention to balancing the diversification of the portfolio, both in terms of location and asset type.
During the 40th fiscal period, JPR acquired additional ownership of Rise Arena Bldg. (acquisition price: 7,300 million yen) in
October 2021. Moreover, JPR sold 40% ownership interest of JPR Umeda Loft Bldg. (sale price of the relevant ownership interest:
7,000 million yen) and Tokyo Tatemono Honmachi Bldg. (sale price: 3,600 million yen), and acquired GRAND FRONT OSAKA(Umekita Plaza and South Building) (acquisition price: 11,800 million yen) and GRAND FRONT OSAKA (North Building)(acquisition price: 9,500 million yen), all in December 2021. As a result of these transactions, the balance of JPR’s assets undermanagement totaled 66 properties, or 484.8 billion yen on an acquisition price basis as of the end of December 2021, with the total
leasable floor space standing at 500,628 m2 and the number of tenants at 1,134.

2

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Asset Management ReportJapan Prime Realty Investment Corporation

Operational Management of Portfolio
In the office property leasing market in the 40th fiscal period, the vacancy rate increased and rent levels were on a downward trend
under the impact of COVID-19, as stated above in Management Environment, and close attention must be paid. Under suchcircumstances, JPR endeavored to attract new tenants through strategic leasing activities and enhance the satisfaction of existing
tenants by maintaining close cooperation with property management companies and brokers, with an aim to secure stable earnings
across the entire portfolio as well as its occupancy rate. As a result of these efforts, the occupancy rate at the end of the 40th fiscal
period was kept at a high level, although it decreased 0.8 points period-on-period to 97.3%.
In terms of property management, based on JPR’s brand concept A/3S (Amenity/Service, Safety and Save Energy), JPR continued
to proactively implement value enhancement works based on tenant needs with an aim to create spaces where the workers feelsatisfaction. As an endeavor to reduce CO2 emissions, JPR conducted renovation of air-conditioning systems and replacement oflighting equipment with LED lamps, which are expected to be effective for the endeavor, at its multiple properties.
Moreover, as its initiatives on environmental issues, JPR has continuously obtained environmental certifications. As of December
31, 2021, JPR has acquired DBJ Green Building Certification*1 for 15 properties (including one newly certified property) and
CASBEE for Building Certification*2 for 28 properties (including six newly certified properties). In addition, JPR has acquired
BELS*3 certification for two of its properties. On top of these certifications JPR acquired, its endeavors on environmental issues
were so acknowledged that it was designated as “Green Star” in the GRESB*4 Real Estate Assessment for 2021, marking the eighthconsecutive year of recognition with the highest ranking in the survey. JPR has also been granted the highest rank of “5 Stars” in
the GRESB Rating, which makes relative assessment based on total scores, for three consecutive years.
*1 The DBJ Green Building Certification is a certification system to select superior real estate that meets the demand of the times by scoring buildings based on thescoring model originally developed by Development Bank of Japan Inc. Its purpose is to promote properties that are environmentally friendly, equipped to mitigate
disasters and prevent crime, as well as meet the social requirements surrounding real estate from various stakeholders (“Green Buildings”).
*2 CASBEE, which stands for Comprehensive Assessment System for Built Environment Efficiency, is a system for comprehensively assessing the environmental
performance of buildings. Efforts to develop and popularize the system in Japan are being carried out under the leadership of the Ministry of Land, Infrastructure,
Transport and Tourism.
*3 BELS is an abbreviation for Building-Housing Energy-efficiency Labeling System. It is a performance labeling system created for the purpose that a third-party
organization accurately conducts the evaluation and indication of energy efficiency performance of non-residential buildings in accordance with the Assessment
Guidelines on Energy Efficiency Performance of Non-residential Buildings (2013) established by the Ministry of Land, Infrastructure, Transport and Tourism.
*4 GRESB is an annual benchmarking assessment to measure ESG (Environmental, Social and Governance) awareness of real estate companies and funds, as well as
the name of the organization which runs the assessment system. It was founded in 2009 primarily by major European pension fund groups. Of the survey subjects,
GRESB Real Estate Assessment covers real estate companies and funds that are mainly engaged in managing existing properties.

Fund Procurement
JPR focuses its endeavors on debt financing with an emphasis placed on lengthening debt maturity and diversifying repayment
dates, in an effort to make its financial base more solid and stronger against the backdrop of the favorable fund procurement
environment and low interest rates.
JPR borrowed 10.4 billion yen to fund the refinancing of interest-bearing debts it repaid during the 40th fiscal period. The average
maturity of and the average interest rate on the new interest-bearing debts (excluding short-term debts) stood at 8.8 years and 0.52%,
respectively, in contrast to 5.6 years and 0.53% for the relevant interest-bearing debts before refinancing (excluding short-term
debts).
As of the end of the 40th fiscal period, the balance of interest-bearing debts totaled 206.9 billion yen, with a balance of borrowingsof 169.0 billion yen and a balance of investment corporation bonds of 37.9 billion yen. The ratio of interest-bearing debts to total
assets (LTV) (Note 1) was 41.7%, long-term and fixed interest-bearing debt ratio (Note 2) was 94.2%, average debt cost (Note 3)
was 0.73% and average maturity (Note 4) was 4.6 years as of the end of the fiscal period.
Moreover, JPR established a commitment line with a credit limit of 24 billion yen with six financial institutions.
The following represents the issuer ratings for JPR as of the end of the 40th fiscal period.
Details of Corporate Credit Ratings as of December 31, 2021
Credit Rating Agency
Japan Credit Rating Agency, Ltd. (JCR)

Corporate Credit Rating (Outlook)
AA (Stable)

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

AA- (Stable)

S & P Global Ratings Japan Inc. (S&P)

A (Stable)(Note 1) Ratio of interest-bearing debts to total assets (LTV): (balance of borrowings + balance of investment corporation bonds)/ total assets(Note 2) Long-term and fixed interest-bearing debt ratio: long-term, fixed-interest interest-bearing debts / total interest-bearing debts(Note 3) Average debt cost: sum total of interest expenses, interest expenses on investment corporation bonds, borrowing expenses (excluding expenses for early
repayment of borrowings and for commitment line agreements), amortization of investment corporation bond issuance costs and investment corporation bondmanagement expenses, divided by the number of business days for each fiscal period and annualized by multiplying by 365 days / average balance ofborrowings and investment corporation bonds for each fiscal period(Note 4) Average maturity is arrived at by calculating a weighted average of maturities from the end of the 40th fiscal period to the repayment deadlines for all interestbearing debts based on the balance of each interest-bearing debt.

113Asset Management ReportJapan Prime Realty Investment Corporation(3)(3)
Additional
AdditionalOfferings,
Offerings, etc.

4.

The table below indicates additional offerings, etc. JPR has conducted in the last five years.
Date

Number of Units
Outstanding

Event

Variation

Unitholders' Capital(millions of yen)

Balance

Variation

Remarks

BalanceJanuary 24, 2017

Additional public offering

47,600920,600

20,237

230,632

February 14, 2017

Third-party allotment

2,400

923,000

1,020

231,653(Note 1)
(Note 2)

March 3, 2020

Additional public offering

35,250958,250

16,207

247,860(Note 3)(Note 1) New investment units were issued through a public offering at 439,040 yen per unit (underwriting price of 425,152 yen per unit) to fund acquisition of new specificassets and partly repay debts.
(Note 2) New investment units were issued through a third-party allotment at 425,152 yen per unit to fund acquisition of new specific assets and partly repay debts.
(Note 3) New investment units were issued through a public offering at 474,810 yen per unit (underwriting price of 459,790 yen per unit) to fund acquisition of new specified
assets and partly repay debts.

CashDistributions
Distributions(4)(4)
Cash

5.

With regard to the cash distributions of the 40th fiscal period, JPR decided to distribute part of the retained earnings brought forwardthat had been internally reserved through the 39th fiscal period, with the aim of having the profit distributions deducted as expenses
based on application of the special provision on taxation of investment corporations (Article 67-15 of the Act on Special Measures
Concerning Taxation) and in order to minimize the burden to unitholders incurred by accrual of corporate income tax, etc. JPR alsodecided to internally reserve 659 million yen as reserve for reduction entry from the unappropriated retained earnings, in applicationof the Special Provisions for Taxation in Cases of Repurchase of Specified Assets (Article 65-7 of the Act on Special Measures
Concerning Taxation). As a result, the cash distribution per unit came to 7,550 yen for the 40th fiscal period.
(Thousands of yen unless otherwise indicated)
Fiscal Period

Unappropriated Retained Earnings at End of Period

37th Fiscal
Period(Jan. 1, 2020 –Jun. 30, 2020)

38th Fiscal
Period(Jul. 1, 2020 Dec. 31, 2020)

39th Fiscal
Period(Jan. 1, 2021 –Jun. 30, 2021)

40th Fiscal
Period(Jul. 1, 2021 Dec. 31, 2021)

6,926,967

7,287,774

7,849,585

8,129,659

7,901,374

10,928

9,865

423,148

792,338

666,586

Total Cash Distributions

6,916,039

7,277,908

7,426,437

7,337,320

7,234,787(Cash Distribution per Unit)(7,493 yen)

(7,595 yen)

(7,750 yen)

(7,657 yen)

(7,550 yen)

Total Cash Distributions from Net Income

6,916,039

7,277,908

7,426,437

7,337,320

7,234,787(Cash distribution from net income per unit)(7,493 yen)

(7,595 yen)

(7,750 yen)

(7,657 yen)

(7,550 yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)

–

–

–

–

–

(- yen)(- yen)(- yen)(- yen)(- yen)BreakdownInternal Reserves

36th Fiscal
Period(Jul. 1, 2019 Dec. 31, 2019)

Repayment of Paid-in Capital(Repayment of paid-in capital per unit)

Of the repayment of paid-in capital, total cash distributions
from the reserve for temporary difference adjustments(Of the repayment of paid-in capital per unit, distribution perunit from the reserve for temporary difference adjustments)
Of the repayment of paid-in capital, total cash distributions
through the reduction in unitholders’ capital for tax purposes(Of the repayment of paid-in capital per unit, distribution perunit through the reduction in unitholders’ capital for tax
purposes)412

Asset Management ReportJapan Prime Realty Investment Corporation(5)(5)
Futureand Vital
VitalIssues
IssuesFutureManagement
ManagementPolicies
Policies and6.

Looking ahead, the Japanese economy is expected to continue showing a pickup, with domestic demand recovering mainly in consumer
spending, restrictions on supply of semiconductors and other products loosening and overseas economies improving, among otherfactors. However, attention should be paid to the trends of COVID-19 and the impacts of fluctuations in the financial and capital
markets, etc.
The office property leasing market is anticipated to hit the bottom in a gradually increasing manner, but close attention must be paid to
the impact of mass supply of office buildings projected for 2023. In this regard, JPR is resolved to continue its endeavors to enhance
the competitiveness of its owned properties, as it has focused on improving tenant satisfaction through proactive implementation ofvalue enhancement works and provision of elaborate management services.
In the for-sale real estate market, it has become even more important to discern the growth potential in earnings of respective properties,
while continuously taking into account the impact of COVID-19 on the leasing market. Moreover, given the current situation in which
the low-interest-rate and low-yield environment is maintained, it is necessary to firmly keep the attitude of vigorously selective
investment for implementing real estate investment that assumes possession of properties over the medium to long term.
1) Acquisition of New Properties and Asset Replacement
JPR will continue to make investment focused on office properties in the Tokyo area, with an aim to improve the quality of its
portfolio and enhance its growth potential and stability over the long term. In the for-sale office property market, the purchase cap
rate and expected cap rate levels still stay low, with properties remaining in short supply. Going forward, although close attention
must continuously be paid to the impact of COVID-19, etc., JPR will fully investigate the stability and growth potential of candidate
properties when acquiring them. As for retail properties, etc., JPR will work to invest in strictly selected blue-chip properties thatcan maintain stable revenues at a certain level in order to complement the stability of earnings of the entire portfolio. In doing so,
JPR will have to be more prudent in investigating, paying close attention to the sales trends, etc. of such properties under the
influence of the spread of COVID-19. JPR will continue its endeavors to acquire new properties under reasonable terms bynegotiating prices based on detailed market studies and property due diligence.
Moreover, JPR will continue to make investment decisions after a proactive collection of information through such sources assponsors of TRIM (Tokyo Tatemono Co., Ltd., Yasuda Real Estate Co., Ltd., Taisei Corporation and Meiji Yasuda Life Insurance
Company), accurately following market trends and carefully researching investment value, including the future potential ofcandidate properties.
Furthermore, JPR will also investigate asset replacement by taking into consideration the timing of implementation, in order toimprove the quality of its portfolio and enhance its growth potential over the long term.
2) Management of Portfolio
JPR will aim to secure stable earnings over a medium to long term by working to prevent move-outs of existing tenants, encouragethem to expand office spaces in the same buildings and renew contracts with upward revision of rents through endeavors to enhancetenant satisfaction, while continuously inviting new tenants through strategic leasing activities. Specifically, JPR will conduct
management and operations based on the following policies:- Strengthen coordination with property management companies and respective tenant brokers- Propose leasing terms and conditions in consideration of the current leasing market situations and promote rapid decision making- Conduct strategic value enhancement works with the intent to improve property earnings and increase tenant satisfaction- Reinforce responses to business continuity plans and environmental friendliness that command high social request
3) Fund Procurement
In accordance with its basic policy of implementing conservative financial operations that focus on stability, JPR will control its
LTV in a conservative manner. In debt financing, JPR will endeavor to further lengthen the maturity with a focus on stability in aneffort to diversify the repayment dates of interest-bearing debts and reduce the repayment amount for each fiscal period, with aneye on reducing refinancing risks that may arise in accordance with future changes in the financial environment. Moreover, JPR
intends to work on fund procurement through issuance of investment corporation bonds as it aims to diversify fund procurementmeans and sources.

13

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Asset Management ReportJapan Prime Realty Investment Corporation(6)(6)
Information
InformationDisclosure
Disclosure

7.

Positioning the proactive voluntary disclosure of information as one of its key management policies, JPR voluntarily discloses
information believed to be useful to investment decisions, along with the information disclosure required by the Tokyo Stock Exchange
and set forth by laws and regulations, etc. As a means for implementing voluntary disclosure, JPR is proactively employing its website(https://www.jpr-reit.co.jp/en/) to provide information including monthly occupancy rates of all properties in the portfolio and historical
data, offer expanded information on sustainability and deliver video presentation on financial results sessions for securities analysts.

SignificantSubsequent
Subsequent Events(7)(7)
Significant
Events8.

Issuance of new investment units
JPR resolved at its Board of Directors meetings held on January 4, 2022 and January 12, 2022 to issue new investment units . With thepayment completed on January 18, 2022 and February 16, 2022, JPR issued the units under the following terms and conditions. As aresult of the issuance, unitholders’ capital stands at 261,751,240,772 yen with the number of investment units outstanding totaling
997,178 units as of the date of this document.
< Issuance of new investment units through public offering (primary offering)>
Number of new investment units issued:
38,100 units
Issue price (offer price):
368,480 yen per unit
Total issue price (total offer price):
14,039,088,000 yen
Paid-in amount (purchase price):
356,824 yen per unit
Total paid-in amount (total purchase price):
13,594,994,400 yen
Payment date:
January 18, 2022
<Issuance of new investment units through third-party allotment>
Number of new investment units issued:
828 units
Paid-in amount (purchase price):
356,824 yen per unit
Total paid-in amount (total purchase price):
295,450,272 yen
Allottee:Mizuho Securities Co., Ltd.
Payment date:February 16, 2022
<Reference Information>
Property Acquisition
After the settlement date of the 40th fiscal period, JPR acquired the following property.
<Tokyo Tatemono Higashi Shibuya Bldg.>
Property overview
Location:
26-20 Higashi 1-chome, Shibuya-ku, Tokyo (residential address)
Type of ownership:
Land: Ownership (co-ownership: 91.4% co-ownership interest), ownership
Building: Sectional ownership
Site area:
2,643.15 m2 (equivalent to co-ownership interest: 2,424.20 m2)
Total floor space:
15,662.20 m2 (equivalent to co-ownership interest: 7,774.77 m2)
Structure/floors:
S, RC, SRC with flat roof, B3/14F
Completed:May 1993
Number of tenants:
14
Total leasable floor space:
7,821.01 m2
Total leased floor space:
7,447.43 m2
Occupancy rate:
95.2%(Note) Number of tenants, total leasable floor space, total leased floor space and occupancy rate indicate the figures as of theacquisition date.
Transaction terms and conditions
Purchase price:
11,300 million yen
Asset type:
Real estate
Contract date
December 23, 2021
Acquisition date:
January 18, 2022

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Asset Management ReportJapan Prime Realty Investment Corporation

Property Sale
JPR concluded a sale agreement regarding the following property on December 23, 2021.
< JPR Umeda Loft Bldg. (30.0% co-ownership interest)>
Asset type:
Beneficiary interest (30.0% co-ownership interest)
Sale price:
5,250 million yen
Delivery date:June 30, 2022 (scheduled)
Buyer:MBS Media Holdings, Inc.
Impact on operating results: JPR plans to record approximately 1,336 million yen in gain on sale of real estate as operating
revenue for the 41st fiscal period (January 1, 2022 – June 30, 2022).
< JPR Umeda Loft Bldg. (30.0% co-ownership interest)>
Asset type:
Beneficiary interest (30.0% co-ownership interest)
Sale price:
5,250 million yen
Delivery date:
December 23, 2022 (scheduled)
Buyer:MBS Media Holdings, Inc.
Impact on operating results: JPR plans to record approximately 1,341 million yen in gain on sale of real estate as operating
revenue for the 42nd fiscal period (July 1, 2022 – December 31, 2022).

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Asset Management ReportJapan Prime Realty Investment Corporation

2.2.Overview
Corporation
Overviewofof thethe Investment
Investment Corporation(1)(1)
Unitholders’
Unitholders’Capital
Capital9.

36th Fiscal
Period as ofDecember 31, 2019
5,000,000

37th Fiscal
Period as ofJune 30, 2020
5,000,000

38th Fiscal
Period as ofDecember 31, 2020
5,000,000

39th Fiscal
Period as ofJune 30, 2021
5,000,000

40th Fiscal
Period as ofDecember 31, 2021
5,000,000

Total number of units issued andoutstanding

923,000

958,250

958,250

958,250

958,250

Unitholders' capital (millions of yen)

231,653

247,860

247,860

247,860

247,860

9,841

11,085

10,946

10,531

10,229Total number of authorized units

Total number of unitholders

MattersRelated
RelatedtotoInvestment
Investment Units
Units (Primary(2)(2)
Matters(PrimaryInvestors)
Investors)

10.

The following table shows the ten largest investors according to the percentage of their owned investment units to the total number ofinvestment units outstanding as of the end of the 40th fiscal period.
Name

Address

Number ofPercentage of Total

Owned Units

Units Outstanding (%)

Custody Bank of Japan, Ltd. (Trust Account)

1-8-12 Harumi, Chuo-ku, Tokyo

250,399

26.13

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

2-11-3 Hamamatsucho, Minato-ku, Tokyo

170,867

17.83

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

2-2-2 Otemachi, Chiyoda-ku, Tokyo

42,824

4.46

Tokyo Tatemono Co., Ltd.

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

29,3003.05

Kawasaki Gakuen

577 Matsushima, Kurashiki-shi, Okayama

25,0002.60

Custody Bank of Japan, Ltd. (Securities Investment Trust
Account)

1-8-12 Harumi, Chuo-ku, Tokyo

24,2592.53

Meiji Yasuda Life Insurance Company

2-1-1 Marunouchi, Chiyoda-ku, Tokyo

24,0002.50

State Street Bank West Client - Treaty 505234(Standing Proxy: Settlement & Clearing Services
Department, Mizuho Bank, Ltd.)SSBTC CLIENT OMNIBUS ACCOUNT (Standing
proxy: Custody Services Department, Tokyo Branch, The
Hongkong and Shanghai Banking Corporation Limited)1776 Heritage Drive, North Quincy, MA
02171, U.S.A. (Shinagawa Intercity Building
A, 2-15-1 Konan, Minato-ku, Tokyo)

12,812

1.33

One Lincoln Street, Boston, MA 02111,
U.S.A.
(3-11-1 Nihonbashi, Chuo-ku, Tokyo)

12,122

1.26

SMBC Nikko Securities Inc.

3-3-1 Marunouchi, Chiyoda-ku, Tokyo
Total

11,6351.21

603,218

62.94(Note) Percentage of total units outstanding is rounded down to the second decimal place.

ItemsRelated
RelatedtotoDirectors
Directors(3)(3)Items

11.

A. The Executive Officer, Supervising Officers and Independent Auditors as of the end of the 40th fiscal period are as follows.
Position
Executive Officer

Supervising
Officers (Note 2)

Independent Auditor

Name

Other Current Assignments

Yoshihiro Jozaki

President and Chief Executive Officer, Tokyo Realty
Investment Management, Inc.

Masato Denawa

Partner Attorney, Spring Partners

Nobuhisa Kusanagi

Group Representative Partner of GYOSEI Certified
Public Tax & Accountants' Co.
Representative, Nobuhisa Kusanagi Certified Public
Accountant Office

Konomi Ikebe

Professor at Graduate School of Horticulture, Chiba
University

EY ShinNihon LLC–

Total Directors' Fee
during the 40th Fiscal
Period (thousands of yen)–
(Note 1)

Numberof Owned
Units
–
–

5,600

–

–
16,500(Note 3)–(Note 1) Yoshihiro Jozaki, Executive Officer, does not receive any compensation from JPR.
(Note 2) Supervising officers may be directors of corporations other than those indicated above, but have no conflict of interest with JPR at those and the above positions.
(Note 3) The independent auditor fees include fees regarding auditing of JPR’s English financial statements and fees regarding preparation of comfort letters for issuanceof investment corporation bonds.

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Asset Management ReportJapan Prime Realty Investment Corporation

B. Policy on Dismissing and Deciding Not to Reappoint the Independent Auditor
The dismissal of independent auditors shall be considered in accordance with the designations of the Investment Trusts Act. The
decision to not reappoint the auditor shall be studied at JPR’s Board of Directors Meetings following comprehensive considerationof circumstances including audit quality, audit fee and other various conditions.

MattersConcerning
ConcerningDirectors
Directors and Officers
Agreement(4)(4)Matters
OfficersLiability
LiabilityInsurance
Insurance
Agreement

12.

JPR has entered into a directors and officers liability insurance agreement as follows.
Scope of the Insured

Overview of Agreement[Overview of insured event covered by the insurance]
The agreement covers such losses as compensation payment and dispute costs to be borne by the insured when they receive
a claim for compensation for the unjust actions they have taken based on their positions at JPR.

Executive Officer and all
Supervising Officers of JPR[Burden ratio of insurance premium]
JPR bears the entire amount of the insurance premium.
[Measures to ensure the appropriateness of the execution of duties by directors and officers]
The agreement does not protect the actions, etc. which the insured executed while recognizing that it may constitutecriminal act or violate the laws and regulations.

AssetManager,
Manager,Asset
Asset Custodian
Custodian andAgent(5)(5)
Asset
andAdministrative
Administrative
Agent

13.

The asset manager, asset custodian and administrative agents of JPR at the end of the 40th fiscal period are as follows.
Asset manager

Outsourcing Category

Name
Tokyo Realty Investment Management, Inc.

Asset custodian

Mizuho Trust & Banking Co., Ltd.

Administrative agent (administration, etc. concerning unitholders' list, etc.)

Mizuho Trust & Banking Co., Ltd.

Administrative agent(administration concerning investment corporation bonds)

Mizuho Bank, Ltd.

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Asset Management ReportJapan Prime Realty Investment Corporation

3.3.Status
StatusofofJPR’s
JPR’sAssets
Assets Under
Under Management
Management(1)(1)
JPR’s
Asset
JPR’s
AssetStructure
Structure

14.

Asset TypeReal estate

39th Fiscal Period(as of June 30, 2021)

Area

Assets owned by JPR(thousands of yen)

40th Fiscal Period(as of December 31, 2021)

Percentage of total
assets (%)

Assets owned by JPR(thousands of yen)

Percentage of total
assets (%)

Central Tokyo

98,365,928

20.3

98,478,170

19.9Greater Tokyo

73,195,537

15.1

67,625,678

13.6

Other Cities

19,853,821

4.1

19,743,902

4.0

Central Tokyo

155,764,625

32.2

155,773,488

31.4Greater Tokyo

49,248,446

10.2

61,562,431

12.4

Other Cities

42,794,155

8.8

54,831,227

11.1

Deposits and otherassets–45,101,021
(–)

9.3
(–)

37,600,580
(–)

7.6
(–)

Total assets–

484,323,538(439,222,516)

100.0(90.7)

495,615,481(458,014,900)

100.0(92.4)

Real estate in trust(Note 1) Total assets owned by JPR are based on the amounts appropriated on the Balance Sheets as of the end of the fiscal periods (book values after depreciation for realestate and real estate in trust).
(Note 2) Figures in parenthesis are portions that practically fall on real estate owned in the object assets.

Major
AssetsOwned
Owned by JPR(2)(2)
Major
Assets15.

The following is an overview of the major assets (ten largest properties by book value at end of period) owned by JPR as of the end of
the 40th fiscal period.
Occupancy Rate(%)

Rate of Monthly
Contracted Rent at
End of Period (%)

11,034.78

100.0

11.5

Office23,987.40

23,587.49

98.3

6.0

Office8,865.71

8,215.13

92.7

3.1

Office18,363,310

5,971.73

5,462.42

91.5

2.4

OfficeBYGS Shinjuku Bldg.

15,519,696

15,227.80

14,553.02

95.6

3.6

OfficeKanematsu Bldg.

14,748,672

8,090.42

7,688.72

95.0

2.4

OfficeJPR Sendagaya Bldg.

14,670,336

6,177.74

6,177.74

100.0

1.8

OfficeSencity Bldg.

13,922,191

13,271.20

12,745.57

96.0

2.8

OfficeKawasaki Dice Bldg.

12,973,147

12,113.12

11,920.14

98.4

2.3

Retail, etc.
OfficeBook Value(thousands of yen)

Leasable Floor
Space (m2)Otemachi Tower (Landwith Leasehold Interest)

38,388,259

11,034.78

Olinas Tower

25,775,774

Shinjuku Center Bldg.

22,173,449

Tokyo Square Garden

Property Name

Shinjuku Square Tower
Total

Leased Floor
Space (m2)

12,943,866

19,266.38

18,037.05

93.6

2.7

189,478,705

124,006.28

119,422.06

96.3

38.7

Asset Class(Note 1) Rate of monthly contracted rent at end of period is the rate arrived at by dividing the monthly contracted rent at end of period for each property by the total rents
for all properties.
(Note 2) The tenants of Shinjuku Center Bldg., Tokyo Square Garden, Sencity Bldg., Kawasaki Dice Bldg. and Shinjuku Square Tower have sublet space to a sub-lessee
and a lease agreement has been executed where the rent paid by the tenant fluctuates in accordance with the lease conditions of the sub-lessee. Therefore, theleasable floor space, leased floor space and occupancy rate entered for each of these buildings are the figures concerning the sub-lessees of the tenant.

1018

Asset Management ReportJapan Prime Realty Investment Corporation(3)(3)
Itemized
ItemizedPortfolio
Portfolio Assets
Assets16.

The following table provides an overview of the real estate properties and beneficiary interests in real estate owned by JPR as of theend of the 40th fiscal period (December 31, 2021).

Area Type

Property Name

Kanematsu Bldg.

14-1 Kyobashi 2-chome, Chuo-ku, Tokyo

Kanematsu Bldg. Annex

17-5 Kyobashi 2-chome, Chuo-ku, Tokyo

JPR Ningyo-cho Bldg.

17-4 Nihonbashi Ningyocho 1-chome,
Chuo-ku, Tokyo

Shin-Kojimachi Bldg.

3-3 Kojimachi 4-chome, Chiyoda-ku, TokyoJPR Crest Takebashi Bldg.

21-4, etc., Kanda-Nishikicho 3-chome,
Chiyoda-ku, TokyoMS Shibaura Bldg.

13-23 Shibaura 4-chome, Minato-ku, Tokyo

Gotanda First Bldg.
JPR Ichigaya Bldg.
Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Bldg.

Central Tokyo

OfficeAcross Shinkawa Bldg. Annex

Shinagawa Canal Bldg.
Rokubancho Bldg.

2-9, etc., Rokubancho, Chiyoda-ku, TokyoJPR Harajuku Bldg.

17-11 Jingumae 6-chome, Shibuya-ku, Tokyo

Shinjuku Center Bldg.
Minami Azabu Bldg.

JPR Sendagaya Bldg.

11-12 Nihonbashi-Horidomecho 1-chome,
Chuo-ku, Tokyo
23-5 Sendagaya 4-chome, Shibuya-ku, Tokyo

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

6-1 Ginza 4-chome, Chuo-ku, Tokyo
6-6, etc., Otemachi 1-chome, Chiyoda-ku,
Tokyo

Science Plaza-Yonbancho Plaza

9-6, etc., Yonbancho, Chiyoda-ku, Tokyo

Shibadaimon Center Bldg.

10-11 Shibadaimon 1-chome, Minato-ku,
TokyoTokyo Square Garden

1-1 Kyobashi 3-chome, Chuo-ku, TokyoJPR Kojimachi Bldg.

6-1 Kojimachi 5-chome, Chiyoda-ku, Tokyo

Otemachi Financial City North Tower

9-5, Otemachi 1-chome, Chiyoda-ku, Tokyo

Retail, etc.

JPR Nihonbashi-horidome Bldg.

JPR Shibuya Tower Records Bldg.

22-14 Jinnan 1-chome, Shibuya-ku, TokyoJPR Jingumae 432

32-13 Jingumae 4-chome, Shibuya-ku, Tokyo

Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
JPR Ginza Namiki-dori Bldg.

1-26, Shinjuku 3-chome, Shinjuku-ku, Tokyo

14,748,672

14,900,000

2,404,118

3,410,000

2,115,468

3,040,000

2,422,776

4,380,000

3,281,864

3,790,000

10,759,110

15,900,000

2,977,806

4,270,000

5,276,846

4,850,000

2,725,587

5,110,000

12,943,866

14,800,000

15,519,696

19,600,000

Real estate572,762783,000

Real estate

22,173,449

19,000,000

Real estate

3,795,207

3,330,000

Real estate

1,892,680

2,360,000

Real estate
Beneficiaryinterest
Beneficiaryinterest
Real estate

2,904,074

3,630,000

8,763,212

10,500,000

4,844,241

6,810,000

14,670,336

11,900,000

Real estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

3,672,905

3,740,000

38,388,259

52,500,000

2,772,762

3,410,000

4,151,818

6,530,000

18,363,310

20,800,000

Real estate

5,808,193

6,840,000

Real estate

11,530,783

12,700,000

11,399,873

14,200,000

4,260,587

4,270,000

2,529,768

2,720,000

Beneficiaryinterest
Beneficiaryinterest
Real estate

7-1 Yurakucho 2-chome, Chiyoda-ku, Tokyo

Real estate

3,265,644

3,330,000

Real estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

10,142,668

11,100,000

3,173,302

3,390,000

4,155,771

7,070,000

2,196,079

1,830,000

2,347,800

2,350,000

1,392,483

2,460,000

7,180,943

10,600,000

2-1 Kinshi 3-chome, Sumida-ku, TokyoJPR Chiba Bldg.

1-7, etc., Shinmachi, Chuo-ku, Chiba, Chiba

Shinyokohama 2nd Center Bldg.

Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Real estateAppraisal ValueBook Valueas of December 31,
as of December 31,
2021
2021
(thousands of yen)(thousands of yen)
(Note)

5-14 Ginza 5-chome, Chuo-ku, Tokyo
20-8 Kanda Misakicho 2-chome, Chiyoda-ku,
Tokyo

Arca East

JPR Yokohama Nihon Odori Bldg.
Office8-1 Nishi-Gotanda 2-chome, Shinagawa-ku,
Tokyo
7-15 Kudan-Minami 4-chome, Chiyoda-ku,
Tokyo
17-1 Higashi-Gotanda 2-chome,
Shinagawa-ku, Tokyo
22-1 Nishi-Shinjuku 6-chome, Shinjuku-ku,
Tokyo
19-1 Shinjuku 2-chome, Shinjuku-ku, Tokyo
16-14 Shinkawa 1-chome, Chuo-ku, Tokyo
25-1 Nishi-Shinjuku 1-chome, Shinjuku-ku,
Tokyo
12-3 Minami-Azabu 2-chome, Minato-ku,
Tokyo
12-33 Konan 2-chome, Minato-ku, Tokyo

FUNDES Suidobashi

Greater Tokyo

Location

Type ofOwnership

17 Nihon-Odori, Naka-ku, Yokohama,
Kanagawa
19-5, etc., Shinyokohama 3-chome,
Kohoku-ku, Yokohama, Kanagawa

Kawaguchi Center Bldg.

1-8 Honcho 4-chome, Kawaguchi, Saitama

JPR Ueno East Bldg.

3-5 Matsugaya 1-chome, Taito-ku, Tokyo

Real estate

2,867,489

5,740,000

38-5 Akebonocho 2-chome, Tachikawa,Tokyo
5-2 Higashi-Ikebukuro 4-chome, Toshima-ku,
Tokyo
6-1 Kamiooka Nishi 1-chome, Konan-ku,
Yokohama, Kanagawa

Beneficiaryinterest

2,883,306

4,620,000

Real estate

12,476,878

17,700,000

Real estate

5,152,685

7,310,000

Tachikawa Business Center Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower

19

11

Asset Management Report

Area Type

Property NameJPR Yokohama Bldg.
Omiya Prime East
Sencity Bldg.
Tanashi ASTA
Cupo-la Main Bldg.

Retail, etc.

Greater Tokyo

OfficeOlinas Tower

JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
FUNDES Ueno
Niigata Ekinan Center Bldg.
JPR Naha Bldg.
Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.

OfficeOther Cities

JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden
JPR Shinsaibashi Bldg.
JPR Shinsaibashi West
GRAND FRONT OSAKA(Umekita Plaza and South Building)Retail, etc.

GRAND FRONT OSAKA(North Building)Japan Prime Realty Investment Corporation

Location
1-3 Taihei 4-chome, Sumida-ku, Tokyo
5-10 Kitasaiwai 1-chome, Nishi-ku,
Yokohama, Kanagawa
1-1, etc., Shimocho 2-chome, Omiya-ku,
Saitama, Saitama
1000, etc., Shinmachi, Chuo-ku, Chiba-shi,
Chiba
1-1 Tanashicho 2-chome, Nishitokyo, Tokyo
1-1 Kawaguchi 1-chome, Kawaguchi,
Saitama
420-1,etc., Kosugimachi 3-chome,
Nakahara-ku, Kawasaki, Kanagawa
3-1 Bessho 7-chome, Saitama, Saitama
8-3, etc., Ekimae-Honcho, Kawasaki,
Kanagawa
2-4 Ueno 7-chome, Taito-ku, Tokyo
24 Yoneyama 1-chome, Chuo-ku, Niigata,
Niigata
1-19 Matsuyama 1-chome, Naha, Okinawa
7-35 Tsutsujigaoka 3-chome, Miyagino-ku,
Sendai, Miyagi
31-1, etc., Misonocho 3-chome, Wakayama,
Wakayama
3-38 Tenjin 1-chome, Chuo-ku, Fukuoka,
Fukuoka
1-23 Sonezaki-Shinchi 2-chome, Kita-ku,
Osaka, Osaka
24-15 Sakae 1-chome, Naka-ku, Nagoya,Aichi
1-1 Yakuin 1-chome, Chuo-ku, Fukuoka,
Fukuoka
2-11 Minami-Senba 4-chome, Chuo-ku,
Osaka, Osaka
11-28 Minamisemba 4-chome, Chuo-ku,
Osaka, Osaka
4-1 Ofuka-cho, Kita-ku, Osaka, Osaka(Umekita Plaza)
4-20 Ofuka-cho, Kita-ku, Osaka, Osaka(South Building)
3-1 Ofuka-cho, Kita-ku, Osaka, OsakaJPR Umeda Loft Bldg.

16-7 Chayamachi, Kita-ku, Osaka, Osaka

Housing Design Center Kobe

2-2 Higashi-Kawasakicho 1-chome, Chuo-ku,
Kobe, Hyogo

JPR Chayamachi Bldg.

2-19 Chayamachi, Kita-ku, Osaka, Osaka

Total

Type ofOwnership
Real estateAppraisal ValueBook Valueas of December 31,
as of December 31,
2021
2021
(thousands of yen)(thousands of yen)
(Note)
25,775,774
40,000,000

Real estate

7,465,137

10,200,000

Beneficiaryinterest

5,516,681

10,400,000

Real estate

13,922,191

14,800,000

Beneficiaryinterest

6,981,834

11,000,000

Real estate

1,572,888

2,890,000

Real estate

7,117,577

5,500,000

3,457,504

4,290,000

12,973,147

14,100,000

3,751,932

4,000,000

1,549,984

2,270,000

1,627,989

2,240,000

2,275,770

4,870,000

1,315,420

1,640,000

1,988,069

3,940,000

2,088,685

3,820,000

Real estate

3,787,486

3,440,000

Real estate

9,878,455

22,200,000

5,202,079

4,700,000

3,904,299

4,520,000

11,858,094

12,300,000

9,548,914

10,100,000

7,470,565

8,400,000

6,077,960

7,290,000

Beneficiaryinterest
Beneficiaryinterest
Real estate
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Real estate
Beneficiaryinterest

6,001,353

8,480,000

458,014,900

574,963,000(Note) The appraisal values at end of period are either appraisal values or survey values by real estate appraisers, based on the Cabinet Office Order on “Regulations on
calculations of investment corporations.”

12

20

Asset Management ReportJapan Prime Realty Investment Corporation

The following table provides changes in rental business results for each of JPR’s real estate properties and beneficiary interests in realestate.

OfficeOfficeOther Cities

Retail, etc.

Greater Tokyo

Retail, etc.

Central Tokyo

OfficeArea Type

Property Name

Kanematsu Bldg.
Kanematsu Bldg. Annex
JPR Ningyo-cho Bldg.
Shin-Kojimachi Bldg.
JPR Crest Takebashi Bldg.
MS Shibaura Bldg.
Gotanda First Bldg.
JPR Ichigaya Bldg.
Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Bldg.
Across Shinkawa Bldg. Annex
Shinjuku Center Bldg.
Minami Azabu Bldg.
Shinagawa Canal Bldg.
Rokubancho Bldg.
JPR Harajuku Bldg.
JPR Nihonbashi-horidome Bldg.
JPR Sendagaya Bldg.
Ginza Sanwa Bldg.
Otemachi Tower (Land with Leasehold
Interest)
Science Plaza-Yonbancho Plaza
Shibadaimon Center Bldg.
Tokyo Square Garden
JPR Kojimachi Bldg.
Otemachi Financial City North Tower
JPR Shibuya Tower Records Bldg.
JPR Jingumae 432
Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
JPR Ginza Namiki-dori Bldg.
FUNDES Suidobashi
Arca East
JPR Chiba Bldg.
JPR Yokohama Nihon Odori Bldg.
Shinyokohama 2nd Center Bldg.
Kawaguchi Center Bldg.
JPR Ueno East Bldg.
Tachikawa Business Center Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower
Olinas Tower
JPR Yokohama Bldg.
Omiya Prime East
Sencity Bldg.
Tanashi ASTA
Cupo-la Main Bldg.
JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
FUNDES Ueno
Niigata Ekinan Center Bldg.
Tokyo Tatemono Honmachi Bldg.
(Note 3)
JPR Hakata Bldg. (Note 4)
JPR Naha Bldg.
Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.
JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden
JPR Shinsaibashi Bldg.
JPR Shinsaibashi West
GRAND FRONT OSAKA(Umekita Plaza and South Building)
GRAND FRONT OSAKA(North Building)

39th Fiscal Period
40th Fiscal Period(from Jan. 1, 2021 to Jun. 30, 2021)(from Jul. 1, 2021 to Dec. 31, 2021)
RentalRentalRatio to Number
Ratio toNumber of Occupancy Revenues
Occupancy Revenues
Total of Tenants
Total
Tenants at Rate at throughout
Rate atthroughout
Rental at Period
RentalPeriod End Period End
PeriodPeriod End
PeriodRevenues
End
Revenues(Note 1)(%)(thousands(%)(thousands(%)(Note 1)(%)
of yen)of yen)437,002
2.6
409,642
2.5
11
100.0
10
95.0
1
100.0
(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
5
100.0
88,9090.5
5
100.0
91,5660.6
1585.3
113,4020.7
16
96.7
109,5270.7
8100.0
121,2090.7
8
100.0
119,126
0.7
10
100.0
492,725
3.0
10
100.0
493,2723.0
2
100.0
134,3360.8
2
100.0
141,312
0.9
10
100.0
159,3701.0
9
90.9
142,9760.9
1
100.0
211,3201.3
1100.0(Note 2) (Note 2)
22
100.0
418,3992.5
23
93.6
421,6882.6
22
96.9
619,6323.8
2295.6
607,9693.7
2
77.1
35,8920.2
277.1
30,2070.2
33
94.4
533,1963.2
30
92.7
506,1743.1
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)5
90.8
72,0310.4
592.3
60,2320.4
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
988.5
291,417
1.8
10
100.0
276,1981.7
5
100.0
192,0841.2
5
100.0
192,9321.2
6
100.0
281,2021.7
6
100.0
298,5011.8
9100.0
103,5060.6
9100.0
110,050
0.7
2

100.0

1,797,500

10.9

2

100.0

1,802,000

11.0

24
9
46
6
10
1
7
1

98.3
100.0
91.5
100.0
100.0
100.0
100.0
100.0

117,214163,054
396,905
168,610234,304(Note 2)81,998(Note 2)

0.7
1.0
2.4
1.0
1.4
(Note 2)0.5
(Note 2)

23
9
47
5
10
1
7
1

95.8
100.0
91.5
70.9
100.0
100.0
100.0
100.0

115,548
181,516
356,364
123,345
272,862(Note 2)85,253(Note 2)

0.7
1.1
2.2
0.8
1.7
(Note 2)0.5
(Note 2)1100.0(Note 2)

(Note 2)1100.0(Note 2)

(Note 2)

9
5
6
39
18
21
42
10
22
4
43
16
22
4
72
1
1
1
3
27
10
10

100.0
87.2
100.0
97.6
98.8
98.1
99.2
100.0
97.6
52.7
100.0
100.0
100.0
100.0
98.0
100.0
100.0
100.0
100.0
97.8
100.0
98.5

207,809
66,401
267,818
135,722
131,371
105,123
473,313
175,784
146,572
73,736344,625
1,015,292
293,080
291,306
573,576(Note 2)
(Note 2)
(Note 2)
127,041
479,043
104,239
123,924

1.3
0.4
1.6
0.8
0.8
0.6
2.9
1.1
0.9
0.4
2.1
6.1
1.8
1.8
3.5
(Note 2)
(Note 2)
(Note 2)
0.8
2.9
0.6
0.8

8
6
7
40
19
21
41
10
22
5
43
16
20
4
71
1
1
1
3
28
10
11

74.1
100.0
100.0
95.5
100.0
91.4
100.0
100.0
97.6
64.0
100.0
98.3
98.8
100.0
96.0
100.0
100.0
100.0
100.0
98.4
100.0
100.0

187,346
68,793
264,044
138,372
133,287
108,125475,303
183,012150,673
207,232
349,340
1,017,448
308,421295,871499,684(Note 2)
(Note 2)
(Note 2)
127,041
449,530
111,079
123,266

1.1
0.4
1.6
0.8
0.8
0.7
2.9
1.1
0.9
1.3
2.1
6.2
1.9
1.8
3.1
(Note 2)
(Note 2)
(Note 2)
0.8
2.7
0.7
0.8

7

94.3

153,7250.9－－

146,483

0.9

－
20
15
17
14
11
5
15
9
13

－
100.0
99.9
95.0
98.2
92.1
99.5
92.1
100.0
99.9

55,006110,949
196,454
105,351
122,330
125,287
156,009576,157
128,636
143,621

0.3
0.7
1.2
0.6
0.7
0.8
0.9
3.5
0.8
0.9

－
20
15
17
14
12
5
16
8
14

－
100.0
99.9
83.6
98.2
100.0
94.1
99.9
100.0
99.9

－
115,749
197,758
96,889123,079
132,651
150,188552,609
127,995
140,432

－
0.7
1.2
0.6
0.8
0.8
0.9
3.4
0.8
0.9

－

－

－

－

239

97.5

(Note 2)

(Note 2)

－

－

－

－

97

98.2

(Note 2)

(Note 2)21

13

Asset Management Report

Retail,etc.

Area TypeJapan Prime Realty Investment Corporation

39th Fiscal Period
40th Fiscal Period(from Jan. 1, 2021 to Jun. 30, 2021)(from Jul. 1, 2021 to Dec. 31, 2021)
RentalRentalRatio to Number
Ratio toNumber of Occupancy Revenues
Occupancy Revenues
Total of Tenants
Total
Tenants at Rate at throughout
Rate atthroughout
Rental at Period
RentalPeriod End Period End
PeriodPeriod End
PeriodRevenues
End
Revenues(Note 1)(%)(thousands(%)(thousands(%)(Note 1)(%)
of yen)of yen)1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)
177,8881.1
179,598
1.1
5
100.0
5
100.0
804
98.1 16,521,229
100.0
1,134
97.3 16,382,659
100.0

Property NameJPR Umeda Loft Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.
Total(Note 1) The number of tenants at end of period is counted as follows except for Shinjuku Square Tower, Shinjuku Center Bldg., the residential section of Science PlazaYonbancho Plaza, Tokyo Square Garden, Otemachi Financial City North Tower, Rise Arena Bldg., Sencity Bldg. and Kawasaki Dice Bldg.: when a single tenantleases multiple rooms, it is counted as one if the tenant uses the same property. If the leased rooms are in multiple buildings, the tenant is counted in plural.
The tenants of Shinjuku Square Tower, Shinjuku Center Bldg., the residential section of Science Plaza-Yonbancho Plaza, Tokyo Square Garden, Otemachi Financial
City North Tower, Rise Arena Bldg., Sencity Bldg., Kawasaki Dice Bldg., GRAND FRONT OSAKA (Umekita Plaza and South Building) and part of GRANDFRONT OSAKA (North Building) have sublet space to sublessees and lease agreements have been executed where the rent paid by the tenants fluctuates inaccordance with the lease conditions of the sublessees and thus the numbers of sublessees have been entered as the numbers of tenants (for GRAND FRONTOSAKA (North Building), some portions employ fixed master lease or direct lease, but the figure indicates the number of end tenants, including those of such
portions.).
(Note 2) JPR does not disclose the rental revenues throughout period of the properties and their ratio to total rental revenues due to inevitable reasons, as no consent todisclosure has been obtained from the tenants or co-owners.
(Note 3) JPR sold Tokyo Tatemono Honmachi Bldg. on December 24, 2021.
(Note 4) For JPR Hakata Bldg., JPR sold its 35.0% co-ownership interest on December 24, 2020, and sold the remaining 65.0% co-ownership interest on March 29, 2021.

StatusOther
Assets(4)(4)
Statusof of
Other
Assets17.

Beneficiary interests with real estate as major entrusted properties have been included in (3) Itemized Portfolio Assets above. There
were no additional major specified assets that are main investment targets of JPR other than those listed under (3) above and thoseindicated below as of the end of the 40th fiscal period.
1) Stock
Issuer Name

Number of
SharesKMO Corporation

1,666

Acquisition Price(thousands of yen) (Note 1)

Appraisal Value(thousands of yen) (Note 2)

Unit Price

Unit Price

50

Amount83,740

Amount50

83,740

Profit andLoss from
Valuation

Remarks－－(Note 1) The acquisition price indicates the amount that includes the expenses required for the acquisition.
(Note 2) The appraisal value indicates the book value.

2) Other securities
Type of AssetBook Value(thousands of yen)

VolumeClaim for refund of funds

Unit Price
1

Appraisal Value(thousands of yen) (Note 1)

AmountUnit Price

5,120

－

Amount5,120－Profit andLoss from
Valuation－

Remarks(Note 2)

(Note 1) The appraisal value indicates the book value.
(Note 2) The asset is a claim for refund of funds of Knowledge Capital, a general incorporated association.

3) Other assets
Type of Asset
Claim for refund of funds

Book Value(thousands of yen)

VolumeUnit Price
1

Appraisal Value(thousands of yen) (Note 1)

Amount710－

Unit Price

Amount－(Note 1) The appraisal value indicates the book value.
(Note 2) The asset is a claim for refund of funds of GRAND FRONT OSAKA TMO, a general incorporated association.

14

22

710

Profit andLoss from
Valuation－

Remarks(Note 2)Asset Management ReportJapan Prime Realty Investment Corporation

4.4.Capital
RealEstate
EstateCapitalExpenditures
Expenditures ofof Owned
Owned Real
PlannedCapital
CapitalExpenditures
Expenditures(1)(1)
Planned18.

The following are major items of capital expenditures for renovation works, etc. planned as of the end of the 40th fiscal period for JPRowned real estate and entrusted real estate regarding beneficiary interests in real estate. Furthermore, the planned construction expenses
include portions that are classified as expenses in accounting.

Property Name

Shinjuku Center Bldg.
Kawaguchi Center
Bldg.
MS Shibaura Bldg.
JPR Shinsaibashi
Bldg.
Sencity Bldg.
Omiya Prime East
JPR Kojimachi Bldg.

Location
Shinjuku-ku,
Tokyo
Kawaguchi,
SaitamaMinato-ku,
TokyoOsaka, Osaka
Chiba, Chiba
Saitama,
SaitamaChiyoda-ku,
Tokyo

PurposePlanned Amount (millions of yen)
Payment
AmountTotal
duringAlreadyValue
the 40th
Paid
Fiscal Period

Schedule

Third phase of replacement of piping
equipment

Jan. 2022–May 2022

70

–

–

Repair of exterior walls

Oct. 2021–Mar. 2022

63

–

–

First phase of reinforcement of elevators

Jul. 2021–Apr. 2022

62

–

–

May 2022–Jun. 2022

61

–

–

Second phase of replacement of airconditioning units
Replacement of toilets in the west building

Jan. 2022–Mar. 2022

59

–

–

Beautification of toilets

Mar. 2022–Apr. 2022

49

–

–

Repair of exterior walls

Jan. 2022–Jun. 2022

47

–

–

Sencity Bldg.

Chiba, Chiba

Jan. 2022–Mar. 2022

46

–

–

JPR Nagoya Fushimi
Bldg.

Replacement of facilities at the third electricalroom

Nagoya, Aichi

Repair of rooftop waterproofing

Apr. 2022–Jun. 2022

35

–

–

CapitalExpenditures
Expendituresduring
during the 40th
(2)(2)
Capital40th Fiscal
FiscalPeriod
Period

19.

The following are the capital expenditure amounts JPR invested in real estate and entrusted real estate during the 40th fiscal period.
Among major capital expenditures, JPR conducted replacement of air conditioning units to maintain and enhance tenant satisfaction,
as well as renovation of common-use areas with the aim of attracting new tenants, among other works. In addition, aside from these
constructions, JPR conducted construction of 545 million yen (Note), which was appropriated as expenditures for repair andmaintenance.
Property Name

Location

Kanematsu Bldg.

Chuo-ku, TokyoBYGS Shinjuku Bldg.

Shinjuku-ku, Tokyo

JPR Shinsaibashi West

Osaka, Osaka

JPR Crest Takebashi Bldg.

Chiyoda-ku, TokyoBYGS Shinjuku Bldg.

Shinjuku-ku, Tokyo

Shinjuku Center Bldg.

Shinjuku-ku, Tokyo

Kawasaki Dice Bldg.

Kawasaki, Kanagawa

JPR Shinsaibashi Bldg.

Osaka, Osaka

Tokyo Tatemono Honmachi
Bldg.

Osaka, Osaka

Other Capital Expenditures

Purpose

PeriodSecond phase of replacement of toilets
on standard floors and corridors andMar. 2021–Dec. 2021
ceilings in common areas
Second phase of repair of common areas
Jul. 2021–Oct. 2021
on B2F through 1st floor
Second phase of replacement of toilets
Jul. 2021–Dec. 2021
Replacement of air-conditioning
Mar. 2021–Dec. 2021
units
Third phase of reinforcement ofFeb. 2021–Jul. 2021
elevators
Second phase of replacement ofJun. 2021–Nov. 2021
piping equipment
Replacement of air-conditioning
Nov. 2021–Dec. 2021
units
First phase of replacement of airNov. 2021–Dec. 2021
conditioning units
Second phase of shift to variable airvolume systems on the 5th and 8th
Sep. 2021–Nov. 2021
floorsReplacement of air-conditioning units, repair of common areas,
replacement of lighting equipment with LED lamps, etc.
Total

Construction
Expenses(millions of yen)
128
98
89
88
68
63
47
44
30
942
1,601

(Note) Expenditures for repair and maintenance included 13 million yen of construction management fees paid to construction management companies as well as theamounts for repair and maintenance constructions themselves.

23

15

Asset Management ReportJapan Prime Realty Investment Corporation(3)(3)
Amounts
Repairs andandMaintenance
MaintenancePlans
Plans
AmountsReserved
Reserved forfor Long-Term
Long-Term Repairs

20.

JPR has deposited the following amounts from the redundant cash flow (including one accompanying internal reserve of profits) suchas depreciation in order to conduct large-scale repairs and maintenance work, based on medium- to long-term repairs and maintenanceplans for individual properties.
Operation Period
Balance of deposits at
beginning of current period
Deposits during the period
Amounts used from
deposits during the period
Deposits carried forward to
the next period

16(Millions of yen)

36th Fiscal Period(Jul. 1, 2019 Dec. 31, 2019)37th Fiscal Period(Jan. 1, 2020 Jun. 30, 2020)

38th Fiscal Period(Jul. 1, 2020 Dec. 31, 2020)

39th Fiscal Period(Jan. 1, 2021 Jun. 30, 2021)

40th Fiscal Period(Jul. 1, 2021 Dec. 31, 2021)

1,319

1,310

1,424

1,421

1,506

997

939

952

859

1,008

1,006

825

955

774

904

1,310

1,424

1,421

1,506

1,610

24

Asset Management ReportJapan Prime Realty Investment Corporation

5.5.Expenses
ExpensesandandLiabilities
Liabilities
Detailsof
ofExpenses
Expenses Related
Related to(1)(1)
Details
toManagement
Management

1.

39th Fiscal Period(Jan. 1, 2021 - Jun. 30, 2021)

Item(a) Asset Management Fees (Note)(Thousands of yen)

788,82440th Fiscal Period(Jul. 1, 2021 - Dec. 31, 2021)

750,590

Management fee 1

233,763

232,820

Management fee 2

199,108

196,807

Management fee 3

355,952

320,961(b) Administrative Service and Asset Custody Fees

83,05382,715(c) Directors' Compensation

4,200

5,600

(d) Trust Fees

20,94619,806(e) Other Operating Expenses

119,022

180,632

Total

1,016,046

1,039,344(Note) Aside from the amounts of the asset management fees entered above, fees for asset management of the acquired properties (40th fiscal period: 143,009 thousandyen) have been paid and included in the book value of each property, and fees for asset management of the sold property (39th fiscal period: 13,325 thousand yen,
40th fiscal period: 35,550 thousand yen) have been paid and deducted from gain on sale of each property.

StatusofofLoans
LoansPayable
Payable(2)(2)
Status2.

As of December 31, 2021 JPR has the following loans payable.

Long-Term Loans Payable

Short-Term Loans Payable

Category

Drawdown
Date

Balance asof Jul. 1,
2021(millionsof yen)Dec. 24, 2020

2,000

Mizuho Bank, Ltd. (Note 4)

Jul. 5, 2021

Mizuho Bank, Ltd.

Dec. 24, 2021

Resona Bank, Ltd. (Note 5)

Oct. 28, 2021

Resona Bank, Ltd.

Dec. 24, 2021

LenderMizuho Bank Ltd.

Total

Balance as
Averageof Dec. 31, Interest Rate
Repayment
2021
(%)
Date
(millions(Note 1)of yen)(Note 2)－

0.185

Jul.5, 2021

－

600

0.158

Jul. 5, 2022

－

7,400

0.157

Jul. 5, 2022

－

1,000

0.157

Jul. 5, 2022

0.157

Jul. 5, 2022

－

3,000

2,000

12,000

Repayment
MethodUse

Remarks

Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteedon maturity

Mizuho Bank Ltd.

Jun. 27, 2014

5,000

5,000

1.178 Jun. 27, 2023

Mizuho Bank Ltd.

Mar. 11, 2015

2,000

2,000

1.011 Mar. 11, 2024

Mizuho Bank Ltd.

Mar. 24, 2015

2,000

2,000

1.056 Mar. 24, 2025

Mizuho Bank Ltd.

Feb. 4, 2016

5,000

5,000

0.804 Feb. 4, 2026

Mizuho Bank Ltd.

Mar. 30, 2017

4,000

4,000

0.400 Mar. 30, 2022

Mizuho Bank Ltd.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

Mizuho Bank Ltd.

Dec. 5, 2019

2,000

2,000

0.646 Dec. 5, 2029

Mizuho Bank Ltd.

Mar. 30, 2021

3,000

3,000

0.675 Mar. 30, 2031

MUFG Bank, Ltd.

Aug. 31, 2015

1,000

1,000

0.873 Aug. 31, 2023

MUFG Bank, Ltd.

Mar. 25, 2016

5,000

5,000

MUFG Bank, Ltd.

Dec. 15, 2016

2,000

2,000

0.510 Mar. 25, 2024 Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed
0.633 Dec. 13, 2024
on maturity

MUFG Bank, Ltd.

Aug. 8, 2017

1,000

1,000

0.638 Aug. 8, 2025

MUFG Bank, Ltd.

Aug. 29, 2017

5,000

5,000

0.600 Aug. 29, 2025

MUFG Bank, Ltd.

Sep. 5, 2017

3,000

3,000

0.593 Sep. 5, 2025

MUFG Bank, Ltd.

Jun. 25, 2021

4,000

4,000

0.450 Jun. 23, 2028

Sumitomo Mitsui Banking Corporation

Jun. 27, 2014

2,500

2,500

1.033 Jun. 27, 2022

Sumitomo Mitsui Banking Corporation

Mar. 30, 2017

4,000

4,000

0.400 Mar. 30, 2022

Sumitomo Mitsui Banking Corporation

Dec. 5, 2019

1,000

1,000

0.245 Dec. 5, 2023

Sumitomo Mitsui Banking Corporation

Jun. 26, 2020

3,000

3,000

0.300 Jun. 26, 2025

Sumitomo Mitsui Banking Corporation

Mar. 30, 2021

2,000

2,000

0.450 Mar. 30, 2028

25

17

Asset Management Report

Long-Term Loans Payable

Category

18

Japan Prime Realty Investment Corporation

Drawdown
Date

Balance asof Jul. 1,
2021(millionsof yen)Development Bank of Japan, Inc.

Dec. 5, 2013

2,000

－

1.188 Dec. 3, 2021

Development Bank of Japan, Inc.

Mar. 24, 2015

2,000

2,000

1.056 Mar. 24, 2025

Development Bank of Japan, Inc.

Dec. 15, 2016

3,000

3,000

0.843 Jun. 14, 2027

Development Bank of Japan, Inc.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

Development Bank of Japan, Inc.

Jun. 27, 2019

2,100

2,100

0.572 Jun. 27, 2029

Development Bank of Japan, Inc.

Jun. 25, 2021

800

800

0.600 Jun. 25, 2030

LenderBalance as
Averageof Dec. 31, Interest Rate
Repayment
2021
(%)
Date
(millions(Note 1)of yen)(Note 2)Development Bank of Japan, Inc.

Dec. 3, 2021

－

2,000

0.600 Dec. 3, 2030

Shinsei Bank, Ltd.

Dec. 5, 2014

2,000

2,000

1.134 Dec. 5, 2024

Shinsei Bank, Ltd.

Dec. 15, 2016

1,000

1,000

0.843 Jun. 14, 2027

Shinsei Bank, Ltd.

Apr. 5, 2019

5,000

5,000

0.673

Shinsei Bank, Ltd.

Sep. 24, 2020

1,000

1,000

0.525 Sep. 25, 2028

Shinsei Bank, Ltd.

Sep. 24, 2020

1,000

1,000

0.675 Sep. 24, 2030

Shinkin Central Bank

Dec. 15, 2016

2,000

－

0.388 Dec. 14, 2021

Shinkin Central Bank

Dec. 5, 2018

3,000

3,000

0.663

Shinkin Central Bank

Jun. 27, 2019

2,000

2,000

0.447 Dec. 27, 2027

Shinkin Central Bank

Dec. 14, 2021

－

2,000

0.525 Dec. 14, 2029

The Norinchukin Bank

Dec. 15, 2016

2,000

－

0.388 Dec. 14, 2021

The Norinchukin Bank

Dec. 5, 2017

1,000

1,000

0.604

Repayment
MethodUse

Remarks

Apr. 5, 2029

Jun. 4, 2027

Jun. 5, 2025

The Norinchukin Bank

Jun. 27, 2019

2,000

2,000

0.405 Jun. 25, 2027

The Norinchukin Bank

Dec. 24, 2020

2,000

2,000

0.525 Dec. 25, 2028

The Norinchukin Bank

Dec. 14, 2021

－

2,000

0.525 Dec. 14, 2029

Mizuho Trust & Banking Co., Ltd.

Feb. 4, 2020

3,000

3,000

0.586

Mizuho Trust & Banking Co., Ltd.

Mar. 30, 2020

2,000

2,000

Mizuho Trust & Banking Co., Ltd.

Dec. 24, 2020

2,000

2,000

Feb. 4, 2030
Principal lump
Unsecured/
0.606 Mar. 29, 2030 sum repayment (Note 3)
Unguaranteedon maturity
0.675 Dec. 24, 2030

The Bank of Fukuoka, Ltd.

Oct. 9, 2015

2,000

2,000

0.816

Oct. 6, 2023

The Bank of Fukuoka, Ltd.

Jul. 7, 2016

2,000

2,000

0.480

Jul. 7, 2026

The Bank of Fukuoka, Ltd.

Sep. 24, 2019

1,000

1,000

0.554 Sep. 21, 2029

The Bank of Fukuoka, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

Aozora Bank Ltd.

Jul. 3, 2017

900

900

Aozora Bank Ltd.

Aug. 25, 2017

1,000

1,000

0.534 Aug. 23, 2024

Aozora Bank Ltd.

Aug. 25, 2017

1,000

1,000

0.574 Feb. 25, 2025

Aozora Bank Ltd.

Aug. 30, 2018

2,000

2,000

0.553 Feb. 25, 2025

Aozora Bank Ltd.

Sep. 24, 2020

500

500

0.525 Sep. 25, 2028

Meiji Yasuda Life Insurance Company

Feb. 5, 2015

1,000

1,000

1.042

0.625

Jul. 3, 2025

Feb. 5, 2025

Meiji Yasuda Life Insurance Company

Jun. 21, 2018

3,200

3,200

0.813 Jun. 21, 2028

Sumitomo Life Insurance Company

Oct. 11, 2016

2,000

2,000

0.453 Oct. 11, 2024

Sumitomo Life Insurance Company

Jul. 22, 2019

1,000

1,000

0.583 Jul. 20, 2029

Sumitomo Life Insurance Company

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

The Shinkumi Federation Bank

Feb. 5, 2018

4,000

4,000

0.404 Aug. 5, 2022

The Nishi-Nippon City Bank, Ltd.

May 27, 2016

3,000

3,000

0.646 May 27, 2026

The Nishi-Nippon City Bank, Ltd.

Dec. 15, 2016

1,000

－

0.388 Dec. 14, 2021

The Nishi-Nippon City Bank, Ltd.

Dec. 14, 2021

－

1,000

0.525 Dec. 14, 2029

Taiyo Life Insurance Company

Sep. 24, 2015

1,000

1,000

0.969 Sep. 24, 2024

Taiyo Life Insurance Company

Jun. 4, 2018

1,000

1,000

0.811

Taiyo Life Insurance Company

Dec. 25, 2020

1,000

1,000

0.675 Dec. 24, 2030

26

Jun. 5, 2028

Asset Management Report

Long-Term Loans Payable

Category

LenderJapan Prime Realty Investment Corporation

Drawdown
Date

Balance asof Jul. 1,
2021(millionsof yen)Balance as
Averageof Dec. 31, Interest Rate
Repayment
2021
(%)
Date
(millions(Note 1)of yen)(Note 2)The Chugoku Bank, Ltd.

Oct. 9, 2015

2,000

2,000

0.816

The Chugoku Bank, Ltd.

Sep. 25, 2018

1,000

1,000

0.661 Mar. 25, 2026

The Iyo Bank, Ltd.

Oct. 9, 2015

1,000

1,000

0.816

Repayment
MethodUse

Remarks

Oct. 6, 2023

Oct. 6, 2023

The Iyo Bank, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

Sompo Japan Insurance Inc.

Dec. 25, 2015

2,000

2,000

0.759 Dec. 25, 2023

Nippon Life Insurance Company

Nov. 22, 2019

2,000

2,000

0.225 Nov. 22, 2023

The Hachijuni Bank, Ltd.

Sep. 26, 2016

1,000

－

0.209 Sep. 24, 2021

The Hachijuni Bank, Ltd.

Oct. 9, 2020

1,000

1,000

0.300

The Hachijuni Bank, Ltd.

Sep. 24, 2021

－

1,000

0.310 Sep. 24, 2026

The Yamaguchi Bank, Ltd.

Nov. 21, 2017

1,000

1,000

0.795 Nov. 19, 2027

The Yamaguchi Bank, Ltd.

Jan. 30, 2020

1,000

1,000

0.598 Jan. 30, 2030

Resona Bank, Ltd.

Mar. 30, 2017

2,000

2,000

0.438 Sep. 30, 2022

NTT FINANCE CORPORATION

May 31, 2018

1,000

1,000

The Kiyo Bank, Ltd.

Jan. 30, 2020

1,000

1,000

The 77 Bank, Ltd.

May 31, 2018

1,000

1,000

0.408 May 31, 2023 Principal lump
Unsecured/
sum repayment (Note 3)
Unguaranteed
0.598 Jan. 30, 2030
on maturity
0.408 May 31, 2023

Daishi Hokuetsu Bank, Ltd.

Nov. 21, 2017

1,000

1,000

0.396 Nov. 21, 2022

Daido Life Insurance Company

Dec. 27, 2018

1,000

1,000

0.316 Dec. 25, 2023

The Chiba Bank, Ltd.

Oct. 25, 2018

1,000

1,000

0.449 Oct. 25, 2023

Tokio Marine & Nichido Fire InsuranceCo., Ltd.

Dec. 27, 2018

1,000

1,000

0.299 Jun. 27, 2023

Oct. 9, 2025

The Hyakugo Bank, Ltd.

Oct. 25, 2018

1,000

1,000

0.582 Apr. 25, 2025

The Hiroshima Bank, Ltd.

Nov. 21, 2017

1,000

1,000

0.396 Nov. 21, 2022

Mitsui Sumitomo Insurance Company,
Limited

Oct. 4, 2019

1,000

1,000

0.310

Sumitomo Mitsui Trust Bank Limited

Mar. 25, 2016

1,000

1,000

0.691 Mar. 25, 2026

The Yamanashi Chuo Bank, Ltd.

Apr. 30, 2021

1,000

1,000

0.600 Apr. 30, 2030

National Mutual Insurance Federationof Agricultural Cooperatives

Dec. 15, 2016

2,000

－

0.388 Dec. 14, 2021

159,000

157,000

Total

Oct. 2, 2026

(Note 1) The average interest rates represent the weighted-averages during the fiscal period, and are rounded to the third decimal place. Furthermore, fees related to loanarrangement paid to the above lenders are not included.
(Note 2) Short-term loans payable are floating-rate loans payable. Long-term loans payable are fixed-rate loans payable.
(Note 3) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemption of
investment corporation bonds.
(Note 4) Of the 2,000 million yen in short-term loans payable that was borrowed on July 5, 2021 from Mizuho Bank, Ltd., JPR made early repayment of 1,400 million yen
on December 7, 2021.
(Note 5) Of the 2,000 million yen in short-term loans payable that was borrowed on October 28, 2021 from Resona Bank, Ltd., JPR made early repayment of 1,000 million
yen on December 7, 2021.

27

19

Asset Management ReportJapan Prime Realty Investment Corporation(3)(3)
Investment
InvestmentCorporation
Corporation Bonds
Bonds

3.

Details of JPR’s investment corporation bonds outstanding as of December 31, 2021 are as follows.
Name

Issue Date

Seventh Series ofDec. 14, 2006
Investment Corporation Bonds
Eighteenth Series of Investment
May 31, 2013
Corporation Bonds
Nineteenth Series of Investment
Feb. 5, 2014
Corporation Bonds
Twenty-first Series of Investment
Jul. 22, 2014
Corporation Bonds
Twenty-second Series ofDec. 4, 2014
Investment Corporation Bonds
Twenty-third Series of Investment
May 31, 2018
Corporation Bonds
Twenty-fourth Series of Investment
Jul. 31, 2019
Corporation Bonds (Green Bonds)
Twenty-fifth Series of Investment
Nov. 26, 2020
Corporation Bonds (Green Bonds)
Twenty-sixth Series of Investment
Mar. 16, 2021
Corporation Bonds
Twenty-seventh Series ofInvestment Corporation Bonds
Dec. 7, 2021
(Sustainability Bonds)
Twenty-eighth Series of Investment
Dec. 7, 2021
Corporation Bonds (Green Bonds)
Total

Balance as of
Balance as of
CouponRate
Jul. 1, 2021
Dec. 31, 2021(%)
(millions of yen) (millions of yen)

Maturity Date

4,500

4,500

2.900

Dec. 14, 2026

2,000

2,000

1.460

May 31, 2023

5,000

5,000

1.110

Feb. 5, 2024

4,000

4,000

1.278

Jul. 22, 2026

3,000

3,000

0.831

Dec. 4, 2024

3,000

3,000

0.550

May 31, 2028

5,000

5,000

0.570

Jul. 31, 2029

6,000

6,000

0.510

Nov. 26, 2030

3,000

3,000

0.760

Mar. 14, 2036

－

1,400

0.420

Dec. 5, 2031

－

1,000

0.670

Dec. 5, 2036

35,50037,900

Redemption
MethodUse

Remarks

Bulletrepayment(Note 1)

(Note 2)

(Note 1) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemption of
investment corporation bonds.
(Note 2) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.

SubscriptionRights
Rights toto Shares(4)(4)
Subscription

4.

Not applicable20

28

Asset Management ReportJapan Prime Realty Investment Corporation

6. Acquisitions and Sales during the 40th Fiscal Period
6. Acquisitions and Sales during the 40th Fiscal Period(1)(1)
Acquisition
Real Estate
EstateandandAsset-Backed
Asset-Backed
Securities
Acquisitionandand Sale
Sale of Real
Securities

5.

Acquisition

Type of
Asset

Real Estate Name

Shibadaimon Center
Bldg.
(Part of land)
Shibadaimon Center
Bldg.
(Part of land)

Real estate(Note 2)
Real estate(Note 2)
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest
Beneficiaryinterest

Rise Arena Bldg.
GRAND FRONTOSAKA (Umekita Plazaand South Building)
GRAND FRONTOSAKA (North
Building)
Tokyo Tatemono
Honmachi Bldg.
JPR Umeda Loft Bldg.
(40.0% co-ownershipinterest)

Sale

Acquisition Date

AcquisitionPrice(millions ofyen)(Note 1)

October 15, 2021

1

－

－

－

－

－

－

－

－

October 15, 2021

110

8

101

3

97

October 28, 2021

7,300

－

－

－

－

－

－

December 24, 2021

11,800

－

－

－

－

－

－

December 24, 2021

9,500

－

－

－

－

－

－

Total

Sale Date

Sale Price Book Value Difference
Sale
Sale Profit
(A)
(B)
(C)
Expense and Loss(millions(millions(A)-(B)(D)(C)-(D)of yen)of yen)(millions (millions (millions(Note)(Note)
of yen)of yen)of yen)－－ December 24, 2021

3,600

4,445

(845)

10

(856)

－

－ December 24, 2021

7,000

4,980

2,019

245

1,773

10,710

9,434

1,275

260

1,014

28,601－－(Note 1) Values of Acquisition Price or Sale Price are amounts (transaction price indicated in the transaction contract, etc.) excluding expenses (such as real estate transaction
brokerage fees) required for acquisition or sale of the relevant real estate.
(Note 2) On October 15, 2021, JPR exchanged part of the site (3.52 m2) of the property and part of the adjacent land (3.52 m2) owned by a third party. In the exchange, theland for sale was first subdivided and delivered in kind to JPR from the entrusted property, and then was sold to the said third party. The land JPR acquired was
additionally entrusted as entrusted property of Shibadaimon Center Bldg. Accordingly, JPR owns the land it acquired as beneficiary interest as of the end of the40th fiscal period.

(2)(2)
Acquisition
OtherAssets
AssetsAcquisitionandand Sale
Sale of Other

6.

Type of Asset

Purchase

Sale

Number of
Certificates, etc.

Amount(thousands of yen)
(Note)

Stock

1,666

83,300Claim forrefund of
funds

－

Total

1,666

Balance at End of Current Period

Amount(thousands of yen)

Number of
Certificates, etc.

Amount(thousands of yen)
(Note)

－

－

1,666

83,300

5,390

－

－

－

5,390

88,690

－

－

1,666

88,690

Number of
Certificates, etc.

(Note) The purchase amount and the balance at end of current period indicate the transaction price described in the transaction contract.

29

21

Asset Management ReportJapan Prime Realty Investment Corporation(3)(3)
SurveyAssets,etc.
etc.
Surveyon
onValues
Values ofof Specified
Specified Assets,

7.

1) Real estate, etc.
AcquisitionorType of Asset
Sale

Sale

Real estate(Note 3)Acquisition

Real estate(Note 3)Acquisition

Beneficiaryinterest

Acquisition

Beneficiaryinterest

Acquisition

Beneficiaryinterest

Sale

Beneficiaryinterest

Sale

Beneficiaryinterest

Real Estate NameTransaction Date

Shibadaimon Center
Bldg.
(Part of land)
Shibadaimon Center
Bldg.
(Part of land)

Appraisal Date

October 15, 2021

110

80

Japan Real Estate
Institute

September 1, 2021

October 15, 2021

1

2

Japan Real Estate
Institute

September 1, 2021

October 28, 2021

7,300

7,660

CBRE KK

September 30, 2021

December 24, 2021

11,80012,300

JLL Morii Valuation& Advisory K.K.

November 30, 2021

December 24, 2021

9,500

10,100

JLL Morii Valuation& Advisory K.K.

November 30, 2021

December 24, 2021

3,600

3,580

Japan Real Estate
Institute

November 1, 2021

December 24, 2021

7,000

5,600
(Note 4)

Japan Valuers Co.,Ltd.

November 1, 2021

Rise Arena Bldg.
GRAND FRONTOSAKA (Umekita
Plaza and South
Building)
GRAND FRONTOSAKA(North Building)Tokyo Tatemono
Honmachi Bldg.
JPR Umeda Loft
Bldg.
(40.0% co-ownershipinterest)

Acquisition
Real Estate
Price or Sale
Appraisal Value
Price
Real Estate Appraiser(millions of yen)(millions of yen)
(Note 2)
(Note 1)

(Note 1) Values of Acquisition Price or Sale Price are amounts (transaction price indicated in the transaction contract, etc.) excluding expenses (such as real estatetransaction brokerage fees) required for acquisition or sale of the relevant real estate.
(Note 2) The appraisal in the table above was conducted by applying to the “Real Estate Appraisal Standards, Specific Thesis Chapter 3: Appraisal on Prices of Real Estate
Subject to Securitization.”(Note 3) On October 15, 2021, JPR exchanged part of the site (3.52 m2) of the property and part of the adjacent land (3.52 m2) owned by a third party. In the exchange, theland for sale was first subdivided and delivered in kind to JPR from the entrusted property, and then was sold to the said third party. The land JPR acquired was
additionally entrusted as entrusted property of Shibadaimon Center Bldg. Accordingly, JPR owns the land it acquired as beneficiary interest as of the end of the40th fiscal period.
(Note 4) The real estate appraisal value of JPR Umeda Loft Bldg. (40.0% co-ownership interest) indicates the value equivalent for 40.0% co-ownership interest of theappraisal value of the entire property as of November 1, 2021.

2) Securities
Transaction Price(millions of yen)
(Note 1)

Survey Price ofSpecified Assets(millions of yen)
(Note 2)Acquisition
or SaleTransaction DateType

Acquisition

December 24, 2021

Stock

KMO Corporation

1,666

83

83

Claim for refund of funds

Knowledge Capital,a general incorporated
association

－

4

4

Acquisition

December 24, 2021

Issuer Name

Volume(Note 1) The transaction price indicates the amount of the transaction price described in the transaction contract.
(Note 2) For transactions for which price investigations of securities related to specified assets are required pursuant to Paragraph 2, Article 201 of the Investment Trusts
Act, Ernst & Young ShinNihon LLC has conducted such investigations based on the Practical Guidelines for Specialized Operations 4400 "Practical Guidelines
for Agreed-Upon Procedures" and the Practical Guidelines for Specialized Operations 4460 "Practical Guidelines for Agreed-Upon Procedures Pertaining toInvestigation into the Value, etc. of Specified Assets of Investment Trusts and Investment Corporations” publicized by The Japanese Institute of Certified Public
Accountants, and JPR has been notified of the results of the investigations on the prices.

3) Transactions of other assets
Acquisition
or SaleTransaction Date

Type

Issuer Name

Acquisition

December 24, 2021

Claim for refund of funds

GRAND FRONT OSAKA TMO,
a general incorporated association

Survey Price ofSpecified Assets(millions of yen)
(Note 2)

Transaction Price(millions of yen)
(Note 1)0(Note 1) The transaction price indicates the amount of the transaction price described in the transaction contract.
(Note 2) For transactions for which price investigations of claims for refund of funds related to specified assets are required pursuant to Paragraph 2, Article 201 of theInvestment Trusts Act, Ernst & Young ShinNihon LLC has conducted such investigations based on the Practical Guidelines for Specialized Operations 4400
"Practical Guidelines for Agreed-Upon Procedures" and the Practical Guidelines for Specialized Operations 4460 "Practical Guidelines for Agreed-Upon
Procedures Pertaining to Investigation into the Value, etc. of Specified Assets of Investment Trusts and Investment Corporations” publicized by The JapaneseInstitute of Certified Public Accountants, and JPR has been notified of the results of the investigations on the prices.

22

30

0

Asset Management ReportJapan Prime Realty Investment Corporation(4)(4)
Transactions
and Major
MajorShareholders
Shareholders
Transactionswith
withInterested
Interested Parties and

8.

1) Transaction Status(Thousands of yen)Transaction Amount, Etc.

Category

Purchase Amount, Etc.

Total

Sale Amount, Etc.
28,690,590

10,710,000

Breakdown of transactions with interested parties
Tokyo Tatemono Co., Ltd.
Total

21,388,690(74.5%)

3,600,000(33.6%)

21,388,690(74.5%)

3,600,000(33.6%)

2) Value of Fee Expenses
Category

Total Paid Fees
(A)

Property Brokerage Fees

212,200

Property Management Fees (Note 2)

329,746

Outsourcing Expenses

628,945

Tenant Brokerage Fees

86,296

Breakdown of Transaction with Interested Parties andMajor Shareholders
Paid Party
Paid Amount (B)Tokyo Tatemono Real Estate Sales Co., Ltd.
210,000
Tokyo Tatemono Co., Ltd.
237,829
Prime Place Co., Ltd.
21,985
Tokyo Tatemono Co., Ltd.
434,180
Prime Place Co., Ltd.
13,375
Tokyo Tatemono Co., Ltd.
29,181
Prime Place Co., Ltd.
1,163

(Thousands of yen)
Ratio to Total
Amount
(B/A)
99.0%
72.1%
6.7%
69.0%
2.1%
33.8%
1.3%

(Note 1) Interested parties and major shareholders refer to the interested parties of the asset management company who has concluded an asset management agreement with
JPR and is regulated as designated in Article 123 of the Enforcement Order of the Act on Investment Trusts and Investment Corporations and article 26-1-27 of theregulation on management reports in regard to investment trusts and investment corporations of The Investment Trusts Association, Japan.
(Note 2) The property management fees indicated in the above table include construction management fees (total of 39,767 thousand yen) appropriated as assets and nothandled as expenses.
(Note 3) Aside from transactions indicated in the above table, JPR paid the following amounts for repairs, etc. conducted by below parties who are interested parties or
major shareholders during the 40th fiscal period.
Tokyo Tatemono Co., Ltd.

703,519 thousand yen

Prime Place Co., Ltd.

38,581 thousand yen

Tokyo Real Estate Management Co., Ltd.

290,024 thousand yen

Shinjuku Center Building Management Co., Ltd.

62,003 thousand yen

Transactionswith
withthetheAsset
Asset Management(5)(5)
Transactions
ManagementCompany
Companyregarding
regardingConcurrentWork
WorkConducted
Conductedby
by thethe Asset
Concurrent
AssetManagement
ManagementCompany
Company
Tokyo Realty Investment Management, Inc., the asset management company of JPR, does not concurrently conduct any of the class 1
financial instruments transaction business, class 2 financial instruments transaction business, land and building transaction business,or real estate syndication business, and has no such transactions with JPR.

31

23

Asset Management ReportJapan Prime Realty Investment Corporation

7.7.Overview
Overviewofof Accounting
Accounting
Assets,Liabilities,
Liabilities, Principal,
Principal, and(1)(1)Assets,
and Profits
Profitsand
andLoss
Loss

9.

Please refer to the Balance Sheets, Statements of Income and Retained Earnings, Statements of Unitholders' Equity and Notes toFinancial Statements as well as Distribution Information on later pages of this report.

ChangesininCalculation
Calculation Method
Method of(2)(2)Changes
ofDepreciation
Depreciation

10.

No change has been made.

ChangesininValuation
Valuation Method
Method of(3)(3)Changes
ofRealRealEstate
EstateandandInfrastructure
InfrastructureAssets
Assets11.

No change has been made.

8. Overview of Self-Managed Investment Trust Beneficiary
8. Overview
of Self-Managed Investment Trust Beneficiary Certificates
Certificates
Acquisition(1)(1)Acquisition

12.

Tokyo Realty Investment Management, Inc., the asset management company of JPR, acquired and holds JPR’s investment units as
indicated below.
Acquisition Date

Number of Units Acquired

Number of Units Disposed

Number of Units Held

September 14, 2001

40

–

40

January 22, 2002 (Note)

60

–

100

Accumulated Total

100

–

100

(Note) The acquisition was due to the investment unit split (2.5 units for one existing unit).

(2)(2)Units
UnitsHeld
Held

13.

Number of Units Held at End
of Period

31st Fiscal Period(Jan. 1, 2017 – Jun. 30, 2017)
32nd Fiscal Period(Jul. 1, 2017 – Dec. 31, 2017)
33rd Fiscal Period(Jan. 1, 2018 – Jun. 30, 2018)
34th Fiscal Period(Jul. 1, 2018 – Dec. 31, 2018)35th Fiscal Period(Jan. 1, 2019 – Jun. 30, 2019)36th Fiscal Period(Jul. 1, 2019 – Dec. 31, 2019)37th Fiscal Period(Jan. 1, 2020 – Jun. 30, 2020)
38th Fiscal Period(Jul. 1, 2020 – Dec. 31, 2020)
39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)
40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)

Ratio to Total Units Issued
and Outstanding (%)

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

100

20

0.0

(Note) Total investment at end of period represents the acquisition price.

24

Total Investment at End of
Period (Note)(millions of yen)32

Asset Management ReportJapan Prime Realty Investment Corporation

9.9.Disclosure
OwningForeign
ForeignReal
Real
EstateDisclosure on
on Corporation
Corporation Owning
EstateNot
Notapplicableapplicable

10.Disclosure
Disclosure
on Estate
RealOwned
EstatebyOwned
by Corporation
10.
on RealCorporation
Owning Foreign Real Estate
Owning Foreign Real Estate
Not applicableNot applicable

11.
11.Other
Other
Notice(1)(1)Notice14.

1) General Meeting of Unitholders
The Thirteenth General Meeting of Unitholders of JPR was held on September 7, 2021.
Items approved at the General Meeting of Unitholders are summarized below.
AgendaPartial amendments to the Articles of Incorporation

Appointment of one Executive Officer
Appointment of one Substitute Executive Officer
Appointment of three Supervising Officers
Appointment of one Substitute Supervising Officer

Overview
Amendments were made to the following items of the Articles of Incorporation.
(1) The provision stipulating that if a unitholder does not attend a general meeting of unitholders anddoes not exercise his or her voting right, the unitholder shall be deemed as having approved theagenda items submitted to the general meeting of unitholders (so-called a deemed approval system)
was reviewed, and amendments were made to halt the application of the “deemed approval” for theimportant proposals regarding (1) appointment or dismissal of Executive Officers or Supervising
Officers; (2) conclusion or cancellation of the asset management agreement by the investment
corporation; (3) dissolution; (4) consolidation of investment units; and (5) exemption of liability of
the Executive Officers, Supervising Officers or Independent Auditor.
(2) With regard to the company to which JPR entrusts its asset management, the name of the asset
management company shall be stipulated for affirmation under the Articles of Incorporation.
(3) Amendments were made to change expression of calendar years from the Japanese calendar to the
Gregorian calendar, except for act numbers.
(4) Other than the above, amendments required for necessary adjustment of articles, etc. were made.
Yoshihiro Jozaki was appointed as Executive Officer.
Yoshinaga Nomura was appointed as Substitute Executive Officer.
Masato Denawa, Nobuhisa Kusanagi and Konomi Ikebe were appointed as Supervising Officers.
Akihiro Kawaguchi was appointed as Substitute Supervising Officer.

2) Board of Directors of JPR
Major issues related to the execution and modification, etc. of major agreements approved at JPR’s Board of Directors meeting in the 40th fiscal
period include the following:
Date of Board of Directors
Meeting

Approved Item

October 22, 2021

Consignment of administrative services
concerning the issuance of the TwentySeventh Series of Unsecured Investment
Corporation Bonds (Note)

October 22, 2021

Consignment of administrative services
concerning the issuance of the TwentyEighth Series of Unsecured Investment
Corporation Bonds (Note)

Overview
JPR consigned the administrative services related to the issuance of theTwenty-Seventh Series of Unsecured Investment Corporation Bonds toMizuho Securities Co., Ltd., SMBC Nikko Securities Inc. and Mizuho
Bank, Ltd., as a condition for the Executive Officer to issue the relevant
Bonds.
JPR consigned the administrative services related to the issuance of theTwenty-Eighth Series of Unsecured Investment Corporation Bonds to
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. and Mizuho Bank,
Ltd., as a condition for the Executive Officer to issue the relevant Bonds.

(Note) The Board of Directors’ meeting held on April 23, 2021 passed the comprehensive resolution on the issuance of the relevant investment corporation bonds. Basedon this, JPR issued the Twenty-Seventh Series of Unsecured Investment Corporation Bonds and the Twenty-Eighth Series of Unsecured Investment Corporation
Bonds on December 7, 2021.

Other(2)(2)Other

15.

Unless otherwise stated, monetary amounts are rounded down and percentage figures are rounded off to the nearest specified unit inthis Semi-Annual Report.

33

25

Financial Statements

Japan Prime Realty Investment Corporation

BalanceSheets
Sheets(1)(1)
Balance16.

(Thousands of yen)
End of 39th Fiscal Period(Jun. 30, 2021)

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Consumption taxes receivable
Other
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net

30,996,393
12,606,208
271,418
129,757－
13,36522,803,957
12,743,466
315,031
132,731
346,039
15,98944,017,144

36,357,215

67,563,186(21,751,330)

66,302,138(22,029,896)

45,811,855

44,272,242

Buildings in trust
Accumulated depreciation

94,393,778(37,637,077)

98,874,885(37,976,679)

Buildings in trust, net

56,756,701

60,898,205

77,603(32,353)

78,936(34,426)

Structures
Accumulated depreciation
Structures, net
Structures in trust
Accumulated depreciation

45,25044,510134,930(82,306)

125,139(79,475)

Structures in trust, net

52,62345,664

Machinery and equipment
Accumulated depreciation

909,004(614,208)

826,696(548,197)

Machinery and equipment, net

294,796

278,499

Machinery and equipment in trust
Accumulated depreciation

1,938,236(1,471,289)

1,980,756(1,507,805)

466,946472,951

178,884(88,622)

186,134(98,400)

Machinery and equipment in trust, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net

90,26287,734Tools, furniture and fixtures in trust
Accumulated depreciation

289,486(189,451)

279,230(185,202)

Tools, furniture and fixtures in trust, net

100,034

94,028Land
Land in trust
Construction in progress
Construction in progress in trust

133,370,201
190,413,992
858
16,153

129,361,642
210,654,006
1,077
1,865

Total property, plant and equipment

427,419,677

446,212,429

11,801,831
3,028

11,801,831
2,307

11,804,859

11,804,138－
689,298
197,510－88,860740,252
200,454710

Intangible assets
Leasehold right
Other
Total intangible assets
Investments and other assets
Investment securities
Lease and guarantee deposits
Long-term prepaid expenses
Other
Total investments and other assets
Total noncurrent assets
Deferred assets
Investment corporation bond issuance costs
Investment unit issuance expenses
Total deferred assets
Total assets

26

End of 40th Fiscal Period(Dec. 31, 2021)

34

886,8091,030,276

440,111,346

459,046,844

171,560
23,487

195,018
16,402

195,047

211,420484,323,538

495,615,481

Financial Statements

Japan Prime Realty Investment Corporation(Thousands of yen)
End of 39th Fiscal Period(Jun. 30, 2021)
Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Accounts payable-otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Other

End of 40th Fiscal Period(Dec. 31, 2021)

2,459,629
2,000,000
20,500,000
1,001,109
91,137605
478,592
2,995,945
246

2,910,219
12,000,000
18,500,000
1,124,191
92,329605
173,458
2,886,309
24,221

29,527,265

37,711,335

35,500,000
138,500,000
9,973,833
13,728,489

37,900,000
138,500,000
9,787,659
14,066,877

197,702,323

200,254,537

227,229,588

237,965,873

247,860,796

247,860,796

1,103,494

1,887,437

1,103,494

1,887,437

Unappropriated retained earnings

8,129,659

7,901,374

Total surplus

9,233,153

9,788,811

257,093,950

257,649,607

Total current liabilities
Noncurrent liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Total noncurrent liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
Surplus
Voluntary reserve
Reserve for reduction entry
Total voluntary reserve

Total unitholders' equity
Total net assets*2

Total liabilities and net assets

257,093,950
484,323,538

35*2257,649,607
495,615,481

27

Financial Statements

Japan Prime Realty Investment Corporation

StatementsofofIncome
Income andand Retained
Retained Earnings(2)(2)
Statements
Earnings

17.

(Thousands of yen)
39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)

Operating revenue
Rent revenue-real estate
Gain on sale of real estate*1*2

Total operating revenue

16,521,229
783,966

40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)*1*217,305,196

Operating expenses
Expenses related to rent business
Loss on sale of real estate
Asset management fee
Administrative service and asset custody fees
Directors' compensation
Trust fees
Other operating expenses*1

Total operating expenses
Operating income
Non-operating income
Interest income
Income on settlement of management association accounts
Insurance income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing expenses
Interest expenses on investment corporation bonds
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance expenses
Other
Total non-operating expenses

7,499,692－
788,824
83,053
4,200
20,946
119,022

16,382,659
1,870,956
18,253,616*1*2

7,731,428
856,197
750,590
82,7155,600
19,806
180,632

8,515,738

9,626,970

8,789,457

8,626,646

207
66,067
4,829
1,237

208
4,350
12,4752,266

72,342

19,301

505,779
25,081
189,149
13,3956,969
258

505,001
28,240196,606
15,166
7,084
266

740,633

752,365

Ordinary income

8,121,166

7,893,582

Income before income taxes

8,121,166

7,893,582

Income taxes-current

605

605

Total income taxes

605

605

Net income

8,120,561

7,892,977

Retained earnings brought forward
Unappropriated retained earnings

9,097
8,129,659

8,396
7,901,374

28

36

Financial Statements

Japan Prime Realty Investment Corporation

StatementsofofChanges
Changes in Unitholders’(3)(3)
Statements
Unitholders’Equity
Equity18.

(Thousands of yen)
39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)

40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)

247,860,796

247,860,796

Unitholders' equity
Unitholders' capital
Balance at beginning of current period
Changes of items during the period
Total changes of items during the period－－

247,860,796

247,860,796

689,444

1,103,494

Provision of reserve for reduction entry

414,050

783,942

Total changes of items during the period

414,050

783,942

1,103,494

1,887,437

7,849,585

8,129,659

Dividends from surplus(414,050)(7,426,437)(783,942)(7,337,320)

Net income

8,120,561

7,892,977

Balance at end of current period
Surplus
Voluntary reserve
Balance at beginning of current period
Changes of items during the period

Balance at end of current period
Unappropriated retained earnings
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry

Total changes of items during the period
Balance at end of current period

280,073(228,284)

8,129,659

7,901,374

8,539,029

9,233,153

Total surplus
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry－－

Dividends from surplus(7,426,437)(7,337,320)

Net income

8,120,561

7,892,977

Total changes of items during the period
Balance at end of current period

694,124555,657

9,233,153

9,788,811

256,399,826

257,093,950

Total unitholders' equity
Balance at the beginning of current period
Changes of items during the period
Provision of reserve for reduction entry－－

Dividends from surplus(7,426,437)(7,337,320)

Net income

8,120,561

7,892,977

Total changes of items during the period
Balance at end of current period

694,124555,657

257,093,950

257,649,607

256,399,826

257,093,950

Total net assets
Balance at beginning of current period
Changes of items during the period
Provision of reserve for reduction entry－－

Dividends from surplus(7,426,437)(7,337,320)

Net income

8,120,561

7,892,977

Total changes of items during the period
Balance at end of current period

37

694,124555,657

257,093,950

257,649,607

29

Financial Statements

Japan Prime Realty Investment Corporation(4)(4)
Statements
StatementsofofCash
CashDistributions
Distributions

19.

I.
II.
III.
IV.

Unappropriated retained earnings
Distribution amount(Distribution amount per unit)
Voluntary reserve
Provision of reserve for reduction entry

40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)
7,901,374,244 yen
7,234,787,500 yen(7,550 yen)

783,942,395 yen

659,017,396 yen

Retained earnings carried forward

Method for calculating distribution amount30

39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)
8,129,659,190 yen
7,337,320,250 yen(7,657 yen)

8,396,545 yen

7,569,348 yen

Pursuant to the policy on cash distributions
provided in Article 30 (2) of the Articles ofIncorporation of JPR, the distribution amountshall be in excess of an amount equivalent to
90% of the “distributable income amount” asstipulated in Article 67-15 of the Act on
Special Measures Concerning Taxation, but nomore than the amount of earnings. Under suchpolicy, JPR decided to pay out distributions ofearnings of 7,337,320,250 yen, which is thelargest integral multiple of the total number ofinvestment units issued and outstanding(958,250 units) from the balance ofunappropriated retained earnings after
deducting the provision of reserve for
reduction entry pursuant to Article 65-7 of the
Act on Special Measures Concerning
Taxation, while minimizing the burden tounitholders incurred by accrual of corporate
income tax, etc. Furthermore, JPR shall not
distribute cash in excess of earnings as
stipulated in Article 30 (4) of the Articles ofIncorporation.

Pursuant to the policy on cash distributions
provided in Article 30 (2) of the Articles ofIncorporation of JPR, the distribution amountshall be in excess of an amount equivalent to
90% of the “distributable income amount” asstipulated in Article 67-15 of the Act on
Special Measures Concerning Taxation, but nomore than the amount of earnings. Under suchpolicy, JPR decided to pay out distributions ofearnings of 7,234,787,500 yen, which is thelargest integral multiple of the total number ofinvestment units issued and outstanding(958,250 units) from the balance ofunappropriated retained earnings after
deducting the provision of reserve for
reduction entry pursuant to Article 65-7 of the
Act on Special Measures Concerning
Taxation, while minimizing the burden tounitholders incurred by accrual of corporate
income tax, etc. Furthermore, JPR shall not
distribute cash in excess of earnings as
stipulated in Article 30 (4) of the Articles ofIncorporation.

38

Financial Statements

Japan Prime Realty Investment Corporation(5)(5)
Statements
StatementsofofCash
CashFlows
Flows

20.

(Thousands of yen)
39th Fiscal Period(Jan. 1, 2021 – Jun. 30, 2021)

40th Fiscal Period(Jul. 1, 2021 – Dec. 31, 2021)

Income before income taxes

8,121,166

7,893,582

Depreciation and amortization

2,100,584

2,128,201

Amortization of investment corporation bond issuance costs

13,395

15,166

Amortization of investment unit issuance expenses

6,969

7,084

Interest income

(207)

(208)

Interest expenses

694,928

701,608

Net cash provided by (used in) operating activities

Decrease (increase) in operating accounts receivable155(43,613)

Decrease (increase) in consumption taxes receivable－(346,039)

760(2,974)

Increase (decrease) in operating accounts payable(68,528)

115,463

Increase (decrease) in accounts payable-other(47,094)

14,414

Increase (decrease) in accrued consumption taxes(23,402)(305,133)

Decrease (increase) in prepaid expenses

Increase (decrease) in advances received
Decrease in property, plant and equipment in trust due to sale

18,679(109,635)

1,866,664

9,434,509－

303

Other, net(141,080)(7,993)

Subtotal

12,542,989

19,494,737

Decrease in intangible assets in trust due to saleInterest income received
Interest expenses paid
Income taxes (paid) refund
Net cash provided by (used in) operating activities

207

208

(692,072)(700,416)

(606)

(605)

11,850,518

18,793,924

Net cash provided by (used in) investing activities
Purchase of property, plant and equipment(988,767)(752,677)

Purchase of property, plant and equipment in trust(845,241)(29,160,741)－(88,860)

Purchase of investment securities
Payments of lease and guarantee deposits(39,749)(50,954)

Repayments of tenant leasehold and security deposits(476,047)(279,722)

Proceeds from tenant leasehold and security deposits

351,409405,874

Repayments of tenant leasehold and security deposits in trust(539,969)(781,974)

Proceeds from tenant leasehold and security deposits in trust

371,336

833,127－(710)(2,167,027)(29,876,637)

Proceeds from short-term loans payable－

14,400,000

Repayment of short-term loans payable(4,000,000)(4,400,000)

Proceeds from long-term loans payable

10,800,000

8,000,000

Repayment of long-term loans payable(9,820,000)(10,000,000)

Other, net
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities

Proceeds from issuance of investment corporation bonds

2,968,190

2,364,727

Dividends paid

(7,425,248)(7,337,192)

Net cash provided by (used in) financing activities(7,477,057)

3,027,534

Net increase (decrease) in cash and cash equivalents

2,206,433(8,055,178)

41,396,168

Cash and cash equivalents at beginning of current period
Cash and cash equivalents at end of current period*13943,602,602

43,602,602*1

35,547,423

31

Financial Statements

Japan Prime Realty Investment Corporation

NotestotoFinancial
FinancialStatements
Statements(6)(6)
Notes

21.

(Basis of Presenting Financial Statements)
Japan Prime Realty Investment Corporation (JPR) maintains its accounting records and prepares its financial statements in accordancewith accounting principles generally accepted in Japan (Japanese GAAP), including provisions set forth in the Financial Instruments
and Exchange Act of Japan, the Act on Investment Trusts and Investment Corporations (the Investment Trusts Act), the Companies Act
and the related regulations, which are different in certain respects as to the adoption and disclosure requirements of International
Financial Reporting Standards.
The accompanying financial statements are basically a translation of the audited financial statements of JPR, which were prepared inaccordance with Japanese GAAP and filed with the Kanto Local Finance Bureau. In preparing the accompanying financial statements,
certain reclassifications have been made to the financial statements issued domestically in order to present them in a format which ismore familiar to readers outside Japan. In addition, the notes to financial statements include information which might not be required
under Japanese GAAP but is presented herein as additional information.
JPR’s accounting periods end at the end of June and December.

(Significant Accounting Policies)
1. Standards and Method for Asset
Valuation

2. Depreciation/Amortization
Method for Long-lived Assets

3. Accounting for Deferred Assets

4. Standards for Recognition of
Revenues and Expenses

5. Scope of Cash and Cash
Equivalents in the Statements ofCash Flows
6. Other Significant Items
Fundamental to the Preparation of
Financial Statements

32

Investment securities
Other securities
Stocks and other securities with no market prices
Stocks and other securities with no market prices are stated at cost being determined by the moving averagemethod.
(1) Property and Equipment (including entrusted properties)
Depreciation is calculated using the straight-line method. The estimated useful lives of major property andequipment ranges are as follows:
Buildings...................................... 3 - 65 years
Structures ..................................... 10 - 35 years
Machinery and equipment ........... 3 - 17 years
Tools, furniture and fixtures ........ 3 - 20 years
Assets with purchase costs of 100,000 yen or more but less than 200,000 yen are depreciated over three years based on
the Corporation Tax Act.
(2) Intangible Assets
Intangible assets are amortized utilizing the straight-line method.
(3) Long-term Prepaid Expenses
Long-term prepaid expenses are amortized utilizing the straight-line method.
(1) Investment Corporation Bond Issuance Costs
Investment corporation bond issuance costs are amortized utilizing the straight-line method over the redemption
periods.
(2) Investment Unit Issuance Expenses
Investment unit issuance expenses are amortized utilizing the straight-line method over three years.
(1) Revenue Recognition
The details of main performance obligations concerning revenue generated from contracts with customers of JPR
and the ordinary time to fulfil said performance obligations (ordinary time to recognize revenue) are as follows.
a. Sale of real estate
For the proceeds from sale of real estate, JPR recognizes revenue when the purchaser who is a customer obtains
control of the relevant real estate as a result of JPR fulfilling its delivery obligations stipulated in the transaction
contract of the real estate.
b. Utilities income
JPR recognizes utilities income upon the supply of electricity and water, etc. to the lessee who is a customer
based on the lease agreement of real estate and details of agreements incidental to it. Of the utilities income,in the case that JPR deems itself to be an agent, the net amount obtained by deducting the amount it pays toother parties from the amount it receives as charges for electricity and gas, etc. supplied by the said otherparties is recognized as revenue.
(2) Accounting Treatment of Taxes on Property and Equipment
In connection with property taxes, city planning taxes and depreciated asset taxes (the “property taxes”), JPR
uses the method of charging the corresponding amounts of assessed taxes to the current fiscal period as expenses
related to rent business.
Furthermore, JPR capitalized an amount equivalent to the property taxes paid to the sellers during the first fiscal
period as a part of the purchase cost, not as expenses, in connection with the acquisition of real estate or entrusted
beneficiary interests in real estate as entrusted property. Taxes on property and equipment capitalized were nil forthe fiscal period ended June 30, 2021. Taxes on property and equipment capitalized amounted to 6,431 thousand
yen for the fiscal period ended December 31, 2021.
Cash and cash equivalents in the Statements of Cash Flows include the following items(1) Cash on hand and cash in trust(2) Deposits placed with banks and deposits in trust that can be withdrawn at any time(3) Short-term investments that are readily convertible to cash and have insignificant risk of price fluctuations andhave original maturities of three months or less from the acquisition date.
(1) Accounting Policies on Trust Beneficiary Interests in Real Estate as Property in Trust
Regarding trust beneficiary interests in real estate, all asset and liability accounts of entrusted properties as well
as all revenue and expense accounts generated by the property in trust are recorded in relevant accounts on the
Balance Sheets and Statements of Income and Retained Earnings.
Furthermore, the following material accounts are separately presented in the Balance Sheets for properties in trust
recorded in relevant accounts.
a. Cash and deposits in trustb. Buildings in trust, structures in trust, machinery and equipment in trust, tools, furniture and fixtures in trust,land in trust and construction in progress in trustc. Tenant leasehold and security deposits in trust(2) Accounting for Consumption Taxes
Revenues and expenses in the Statements of Income and Retained Earnings do not include consumption taxes.

40Financial Statements

Japan Prime Realty Investment Corporation(Changes in Accounting Policies)(1) Adoption of Accounting Standard for Revenue Recognition, Etc.
JPR has adopted the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29 (revised 2020), issued on March 31,2020) and the “Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Guidance No. 30 (revised 2021),
issued on March 26, 2021 from the beginning of the 40th fiscal period, and decided to recognize revenue at the amount expected tobe received in exchange for the promised goods or services when control of the goods or services is transferred to the customer. The
impact of this change on the financial statements is minimal.
Furthermore, in accordance with the transitional measures stipulated in Paragraph 89-3 of the Accounting Standard for Revenue
Recognition, the note related to Revenue Recognition for the previous fiscal period is not disclosed.
(2) Adoption of Accounting Standard for Fair Value Measurement, Etc.
JPR has adopted the “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued on July 4, 2019), etc. fromthe beginning of the 40th fiscal period, and decided to apply the new accounting policies set forth by the said Accounting Standard,
etc. going forward in accordance with the transitional measures as stipulated in Paragraph 19 of the “Accounting Standard for Fair
Value Measurement” and Paragraph 44-2 of the “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10 (revised2019), issued on July 4, 2019). The impact of this change on the financial statements is minimal.
Furthermore, pursuant to the provision of Article 2-5 of the Supplementary Provision of the “Cabinet Office Ordinance Partially
Revising Regulation for Terminology, Forms, and Preparation Methods of Financial Statements” (Cabinet Office Ordinance No. 61,
September 24, 2021), the matters listed in Article 8-6-2, paragraph 1, item 3 of the revised Regulation on Terminology, Forms, andPreparation Methods of Financial Statements are omitted.

41

33

Financial Statements

Japan Prime Realty Investment Corporation(Notes to Balance Sheets)
1. Balance of Unused Commitment LineJPR has executed a commitment line agreement with its principal banks primarily to minimize refinancing risks and enhancefinancial stability.
(Thousands of yen)
End of 39th Fiscal Period(as of June 30, 2021)
Credit limit

End of 40th Fiscal Period(as of December 31, 2021)
24,000,000

Outstanding debts at end of period
Unused commitment line at end of period

24,000,000－－

24,000,000

24,000,000*2 Minimum Total Unitholders’ Equity Designated in Article 67- 4 in the Act on Investment Trusts and Investment Corporations(Thousands of yen)
End of 39th Fiscal Period(as of June 30, 2021)

End of 40th Fiscal Period(as of December 31, 2021)
50,00050,000(Notes to Statements of Income and Retained Earnings)*1. Breakdown of Rent Revenue-Real Estate and Expenses Related to Rent Business(Thousands of yen)
39th Fiscal Period(January 1, 2021 – June 30, 2021)

40th Fiscal Period(July 1, 2021 – December 31, 2021)

A. Rent Revenue-Real Estate
Rent Revenue
Rents
Land rents

11,984,455
1,797,500

11,911,724
1,802,000

Common charges

1,446,921

1,384,623

Parking fees

261,871

264,921

Advertising fees

37,41936,937

Antenna usage fees

28,72929,020Other

44,38445,95015,601,282

15,475,177

676,975

787,919

Subtotal
Other rental revenues
Incidental rent income
Time-based parking fees

8,855

8,725

Cancellation charges

66,725

10,473

Income equivalent to expenses for restoration
to original condition

133,597

56,320

Other miscellaneous income

33,79244,043919,947

907,481

16,363,416,363,49494005,870
16,521,229

16,363,416,363,49494005,870
16,382,659

Outsourcing expenses

630,769

628,945

Utilities expenses

714,170

849,905

2,436,042

2,422,872

Subtotal
Total rent revenue-real estate
B. Expenses Related to Rent Business

Property and other taxes
Casualty insurance

26,79627,256

Repairs and maintenance504,151532,237

Property management fees

302,526

289,978

Management association accounts

588,158

612,129

2,100,231

2,127,848

196,844240,2537,499,692

7,731,428

9,021,537

8,651,231

Depreciation
Other
Total expenses related to rent business
C. Profits for Rent Business
(A-B)

34

42

Financial Statements

Japan Prime Realty Investment Corporation*2. Breakdown of Gain or loss on Sale of Real Estate, etc.
(Thousands of yen)
39th Fiscal Period(January 1, 2021 – June 30, 2021)
JPR Hakata Bldg. (65.0% co-ownership interest)
Proceeds from sale of real estate

40th Fiscal Period(July 1, 2021 – December 31, 2021)

2,665,000－

1,866,664－

Other expenses related to sale

14,368－Gain on sale of real estate

783,966－

Proceeds from sale of real estate－

110,000

Cost of sale of real estate

－

8,838

Other expenses related to sale

－

3,835

Gain on sale of real estate－

97,325

Cost of sale of real estatePart of land of Shibadaimon Center Bldg.

JPR Umeda Loft Bldg. (40.0% co-ownership interest)
Proceeds from sale of real estate－

7,000,000

Cost of sale of real estate－

4,980,376

Other expenses related to sale－

245,992

Gain on sale of real estate－

1,773,631

Tokyo Tatemono Honmachi Bldg.
Proceeds from sale of real estate－

3,600,000

Cost of sale of real estate－

4,445,597

Other expenses related to sale－

10,600Gain on sale of real estate－

856,197

39th Fiscal Period(January 1, 2021 – June 30, 2021)

40th Fiscal Period(July 1, 2021 – December 31, 2021)(Notes to Statements of Changes in Unitholders’ Equity)

Total number of authorized units and number of units outstanding
Total number of authorized units
Number of units outstanding

5,000,000 units

5,000,000 units

958,250 units

958,250 units(Notes to Statements of Cash Flows)*1. Reconciliation of the Amounts of the Cash and Cash Equivalents at End of Period in the Statements of Cash Flows with theAmounts of the Corresponding Accounts on the Balance Sheets(Thousands of yen)
39th Fiscal Period(January 1, 2021 – June 30, 2021)

40th Fiscal Period(July 1, 2021 – December 31, 2021)

Cash and deposits

30,996,393

22,803,957

Cash and deposits in trust

12,606,208

12,743,466

Cash and cash equivalents

43,602,602

35,547,423(Leases)
Future minimum lease payments to be received under non-cancelable operating leases(Thousands of yen)
39th Fiscal Period(as of June 30, 2021)

40th Fiscal Period(as of December 31, 2021)

Due within one year

6,058,160

6,035,459

Due after one year

11,002,567

11, 094,928

Total

17,060,727

17, 130,388

43

35

Financial Statements

Japan Prime Realty Investment Corporation(Financial Instruments)
1. Matters Concerning Status of Financial Instruments(1) Policy on Handling Financial Instruments
In an aim to proactively expand asset size and maintain stable cash distributions to unitholders, JPR adopts the asset management
policy of paying heed to efficiently combining the procurement of long-term funds that are stable and the procurement of short-term
funds that emphasize flexibility.
There may be cases where JPR will engage in derivative transactions, but such will be limited to hedging for interest rate fluctuation
risk and other hedging purposes. Please note that JPR is not engaged in derivative transactions at present.
(2) Description of Financial Instruments and Associated Risks, and Risk Management Structure
Tokyo Realty Investment Management, Inc. (TRIM), the asset management company of JPR, strives for risk management bycomplying with the JPR Asset Management Guidelines and other rules and regulations. The following outlines the description ofindividual financial instruments and the associated risks, and the risk management.
Deposits are exposed to risks of bankruptcy of the financial institutions holding the deposits and other credit risks, but the risks aremanaged through such measures as setting a minimum credit rating for the financial institutions holding the deposits.
Loans payable and investment corporation bonds are exposed to liquidity risks at the time of repayment/redemption, but the liquidity
risks are managed through such measures as procuring funds from the capital market by increasing capital, executing a commitmentline agreement with the main lending financial institutions, and also having statements of cash receipts and disbursements preparedby the financial division.
(3) Supplementary Explanation on Matters Concerning Fair Value, etc. of Financial Instruments
Certain assumptions are used in calculating the fair value of financial instruments, and there can be cases where the values may vary
based on different assumptions.
2. Matters Concerning Fair Value, etc. of Financial Instruments
The following are the carrying values and fair values as of June 30, 2021 of financial instruments, and the difference between theseamounts. Furthermore, notes on “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are omitted asthese are settled with cash and within a short period of time and thus the book value approximates the fair value. Notes on “Tenantleasehold and security deposits” and “Tenant leasehold and security deposits in trust” are also omitted as they lack materiality.
(Thousands of yen)
Carrying Value(Note 1)

Estimated Fair
Value (Note 1)

Difference(1)

Current portion of long-term loans payable(20,500,000)(20,554,180)

54,180(2)

Investment corporation bonds(35,500,000)(36,431,425)

931,425(3)

Long-term loans payable(138,500,000)(140,013,949)

1,513,949

The following are the carrying values and fair values as of December 31, 2021 of financial instruments, and the difference between
these amounts. Furthermore, notes on “Cash and deposits,” “Cash and deposits in trust” and “Short-term loans payable” are omitted asthese are settled with cash and within a short period of time and thus the book value approximates the fair value. Notes on “Tenantleasehold and security deposits” and “Tenant leasehold and security deposits in trust” are also omitted as they lack materiality.
(Thousands of yen)
Carrying Value(Note 1)

Estimated Fair
Value (Note 1)

Difference(1)

Current portion of long-term loans payable(18,500,000)(18,528,074)

28,074(2)

Investment corporation bonds(37,900,000)(38,761,615)

861,615(3)

Long-term loans payable(138,500,000)(139,821,667)

1,321,667(Note 1) Liabilities are shown in parentheses.
(Note 2) Method of calculation of fair value of financial instruments(1) Current portion of long-term loans payable, and (3) Long-term loans payable
The fair value of these financial instruments is calculated based on the discounted cash flow method under which the total amount of principal and interests are
discounted by the rate assumed as being applicable in the event of a new drawdown whose term is corresponding to the remaining loan term.

36

44

Financial Statements

Japan Prime Realty Investment Corporation(2) Investment corporation bonds
Of the fair value of these financial instruments, those with market price are measured based on market price and those with no market price are calculated inaccordance with (1) and (3) above.
(Note 3) Amount of repayment of long-term loans payable or redemption of investment corporation bonds scheduled to be due subsequent to the 39th fiscal period end(June 30, 2021)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due afterThree Years
through Four
Years

－

2,000,000

5,000,000

3,000,000－

25,500,000

20,500,000

16,000,000

20,000,000

21,000,000

20,900,000

60,600,000

Investment corporation bonds
Long-term loans payable

Due after FourYears throughFive Years

Due after Five
Years

Amount of repayment of long-term loans payable or redemption of investment corporation bonds scheduled to be due subsequent to the 40th fiscal period end(December 31, 2021)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due afterThree Years
through Four
Years

－

2,000,000

8,000,000－

8,500,000

19,400,000

18,500,000

21,000,000

15,000,000

23,900,000

14,000,000

64,600,000

Investment corporation bonds
Long-term loans payable

Due after FourYears throughFive Years

Due after Five
Years

(Securities)
39th fiscal period (as of June 30, 2021)
Not applicable
40th fiscal period (as of December 31, 2021)
Not applicable(Derivative Transactions)
39th fiscal period (as of June 30, 2021)
Not applicable as JPR entered into no derivative transactions
40th fiscal period (as of December 31, 2021)
Not applicable as JPR entered into no derivative transactions(Retirement Benefits)
39th fiscal period (as of June 30, 2021)
Not applicable as JPR does not have any retirement benefit plans
40th fiscal period (as of December 31, 2021)
Not applicable as JPR does not have any retirement benefit plans(Tax Effect Accounting)
1. Breakdown of Main Items that Caused Differences between the Effective Statutory Tax Rate and the Effective Tax Rate after
Applying Tax Effect Accounting
39th Fiscal Period(January 1, 2021 – June 30, 2021)
Effective statutory tax rate

40th Fiscal Period(July 1, 2021 – December 31, 2021)

31.46%

31.46%

Deductible cash distributions(28.42%)(28.83%)Other(3.03%)(2.62%)

Effective tax rate after applying tax effect accounting

0.01%

0.01%

(Adjustment)

45

37

Financial Statements

Japan Prime Realty Investment Corporation(Equity Method Income and Retained Earnings)
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable as JPR does not have any affiliated companies
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable as JPR does not have any affiliated companies(Transactions with Related Parties)
1. Parent Company and Major Corporation Unitholders
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable
2. Affiliated Companies
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable
3. Sister Companies
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable
4. Directors and Major Individual Unitholders
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable(Asset Retirement Obligations)
39th fiscal period (January 1, 2021 – June 30, 2021)
Not applicable
40th fiscal period (July 1, 2021 – December 31, 2021)
Not applicable(Segment Information)[Segment Information]
Disclosure is omitted as JPR is comprised of a single operating segment engaged in the property rent business.
[Related Information]
39th fiscal period (January 1, 2021 – June 30, 2021)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service unit is in excess of 90% of operating revenue
on the Statements of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from domestic external customers are in excess of 90% of total revenues on the Statementsof Income and Retained Earnings.
(2) Property, plant and equipment
Disclosure is omitted as the amount of JPR’s property, plant and equipment located in Japan are in excess of 90% of total
property, plant and equipment on the Balance Sheets.

38

46

Financial Statements

Japan Prime Realty Investment Corporation

3. Information about Major Customers
Disclosure is omitted as sales to any single external customer accounts for less than 10% of the operating revenue on theStatements of Income and Retained Earnings.
40th fiscal period (July 1, 2021 – December 31, 2021)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service unit is in excess of 90% of operating revenue
on the Statements of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from domestic external customers are in excess of 90% of total revenues on the Statementsof Income and Retained Earnings.
(2) Property, plant and equipment
Disclosure is omitted as the amount of JPR’s property, plant and equipment located in Japan are in excess of 90% of total
property, plant and equipment on the Balance Sheets.
3. Information about Major Customers
Disclosure is omitted as sales to any single external customer accounts for less than 10% of the operating revenue on the Statementsof Income and Retained Earnings.

(Investment and Rental Properties)
JPR owns office properties (urban commercial facilities), retail properties (urban retail properties) and urban multi-use facilities forleasing in Tokyo and other regions. The following is the carrying value on the Balance Sheets, amount of increase (decrease) during
the period and fair value of these investment and rental properties.
(Thousands of yen)

Carrying Value on the Balance Sheets
Balance at Beginning of Period

39th Fiscal Period(January 1, 2021 – June 30, 2021))

40th Fiscal Period(July 1, 2021 – December 31, 2021)

441,758,455

439,222,516

Amount of Increase (Decrease) during the Period(2,535,938)

18,792,383

Balance at End of Current Period

439,222,516

458,014,900

549,331,000

574,963,000

Fair Value at End of Period(Note 1) The carrying value on the Balance Sheets is the cost of acquisition less accumulated depreciation.

(Note 2) For the 39th fiscal period, the amount of decrease is primarily attributable to the sale of JPR Hakata Bldg. (65.0% co-ownership interest) (1,866,664 thousand yen)and depreciation (2,100,231 thousand yen). For the 40th fiscal period, the amount of increase is primarily attributable to the acquisition of part of land of
Shibadaimon Center Bldg. (3,460 thousand yen), the acquisition of additional ownership of Rise Arena Bldg. (7,345,010 thousand yen), the acquisition of GRANDFRONT OSAKA (Umekita Plaza and South Building) (11,864,400 thousand yen) and the acquisition of GRAND FRONT OSAKA (North Building) (9,554,879
thousand yen), and the amount of decrease is primarily attributable to the sale of part of land of Shibadaimon Center Bldg. (8,838 thousand yen), the sale of Tokyo
Tatemono Honmachi Bldg. (4,445,597 thousand yen), the sale of JPR Umeda Loft Bldg. (40.0% co-ownership interest) (4,980,376 thousand yen) and depreciation(2,127,848 thousand yen).
(Note 3) The fair value at end of the current period is the appraisal value or survey value as appraised by an outside real estate appraiser.

The income (loss) in the 39th and 40th fiscal periods for investment and rental properties are as presented in the “Notes to Statementsof Income and Retained Earnings.”

47

39

Financial Statements

Japan Prime Realty Investment Corporation(Revenue Recognition)
40th fiscal period (July 1, 2021 – December 31, 2021)
Breakdown information on revenue from contracts with customers

Sale of real estate(Thousands of yen)

Revenue from Contracts with Customers(Note 1)
10,710,000

Utilities income (Note 3)

Sales to External Customers(Note 2)
1,870,956

787,919

787,919

Others－

15,594,740

Total

11,497,919

18,253,616(Note 1) Rent revenue subject to the “Accounting Standard for Lease Transactions” (ASBJ Statement No.13) are excluded from “Revenue from contracts with customers”
as such revenue is out of the scope of Accounting Standard for Revenue Recognition. Revenue from contracts with customers mainly represents proceeds fromsale of real estate and utilities income.
(Note 2) As sale of real estate is recorded as gain or loss on sale of real estate, etc. in the Statements of Income and Retained Earnings, the amount obtained by deducting
cost of sale of real estate and other expenses related to sale from proceeds from sale of real estate is indicated for sales to external customers. Furthermore, as JPR
records gain on sale of real estate for operating revenue while recording loss on sale of real estate for operating expenses, the table above indicates the amount ofgain on sale of real estate only.
(Note 3) Utilities income indicates the amount recorded as revenue upon the supply of electricity and water, etc. to the lessee who is a customer based on the lease agreementof real estate and agreements incidental to it.

(Per Unit Information)
39th Fiscal Period(January 1, 2021 – June 30, 2021)

40th Fiscal Period(July 1, 2021 – December 31, 2021)

268,295 yen

268,875 yen

8,474 yen

8,236 yen

Total net assets per unit
Net income per unit

(Note 1) Net income per unit is calculated by dividing net income by the weighted-average number of units outstanding during the current fiscal period. Diluted net income
per unit has not been presented since no subscription rights to shares are outstanding.
(Note 2) Net income per unit was calculated based on the following data:

Net income (thousands of yen)

39th Fiscal Period(January 1, 2021 – June 30, 2021)
8,120,561

Amounts not attributable to ordinary unitholders (thousands of yen)－－

8,120,561

7,892,977

958,250 units

958,250 units

Net income attributable to ordinary investment units (thousands of yen)
Average number of units during the fiscal period

40th Fiscal Period(July 1, 2021 – December 31, 2021)
7,892,977(Subsequent Events)

Issuance of new investment units
JPR resolved at its Board of Directors meetings held on January 4, 2022 and January 12, 2022 to issue new investment units. With
the payment completed on January 18, 2022 and February 16, 2022, JPR issued the units under the following terms and conditions.
As a result of the issuance, unitholders’ capital stands at 261,751,240,772 yen with the number of investment units outstanding
totaling 997,178 units as of the date of this document.

< Issuance of new investment units through public offering (primary offering)>
Number of new investment units issued:
38,100 units
Issue price (offer price):
368,480 yen per unit
Total issue price (total offer price):
14,039,088,000 yen
Paid-in amount (purchase price):
356,824 yen per unit
Total paid-in amount (total purchase price):
13,594,994,400 yen
Payment date:
January 18, 2022
<Issuance of new investment units through third-party allotment>
Number of new investment units issued:
828 units
Paid-in amount (purchase price):
356,824 yen per unit
Total paid-in amount (total purchase price):
295,450,272 yen
Allottee:Mizuho Securities Co., Ltd.
Payment date:February 16, 2022

40

48

Financial Statements

Japan Prime Realty Investment Corporation(7)(7)
Detailed
DetailedSchedules
Schedules

22.
1) Schedule of Securities
a. StockNumber of
SharesUnit Price(thousands ofyen)

Amount(thousandsof yen)Unit Price(thousandsof yen)Amount(thousands ofyen)Profit andLoss from
Valuation(thousands ofyen)

KMO Corporation

1,666

50

83,74050

83,740

－

－

Total

1,666

－

83,740－83,740－－Acquisition Price (Note 1)
Issuer Name

Appraisal Value (Note 2)

Remarks(Note 1) The acquisition price indicates the amount that includes the expenses required for the acquisition.
(Note 2) The appraisal value indicates the book value.

b. Other securities
Type of Asset

Issuer Name

Claim for refundof funds

Knowledge Capital,a general
incorporated
association

Book Value(thousandsof yen)AccruedInterest(thousandsof yen)Prepaidinterest
accrued(thousands ofyen)

Appraisal
Value(thousands ofyen) (Note)

Profit andLoss from
Valuation(thousands of
yen)

－

5,120

－

－

5,120

－

－

－

5,120

－

－

5,120

－

－

Total
Face
Value

Total

Remarks(Note) The appraisal value indicates the book value.

2) Status of Contract Amounts, etc. and Fair Value of Derivative Transactions and Forward Exchange Transactions
Not applicable49

41

Financial Statements

Japan Prime Realty Investment Corporation

3) Schedule of Assets Related to Real Estate

Asset TypeAccumulated Depreciation
Balance as of
Balance as of Increase during Decrease during
Depreciation
December 31, Or Accumulated
July 1, 2021
the Period
the Period
during the2021
Amortization(thousands of (thousands of(thousands ofPeriod(thousands of (thousands of
yen)
yen)
yen)
(thousands of
yen)
yen)
yen)

Current Assets
Property, plantand equipment(Real estate)
Buildings

Net Balance as ofDecember 31, 2021
(thousands of yen)

－

－

－

－

－

－

－

67,563,186
77,603

583,346
1,333

1,844,393－

66,302,138
78,93622,029,896
34,426

992,062
2,073

44,272,242
44,510909,004

20,772103,080

826,696548,197

23,792

278,499

178,884

7,250－

186,134

98,4009,778

87,734Structures
Machinery andequipment
Tools,
furniture andfixtures
Land
Constructionin progress
Subtotal(Beneficiaryinterests in trust)

133,370,201－

4,008,558

129,361,642－－

129,361,642

858

219

－

1,077

－

－

1,077

202,099,738

612,921

5,956,032

196,756,627

22,710,920

1,027,706

174,045,707

Buildings intrust

94,393,778

7,857,196

3,376,090

98,874,885

37,976,679

1,058,972

60,898,205

134,930

4,758

14,549125,139

79,4752,315

45,664

1,938,236

147,938

105,417

1,980,756

1,507,805

27,788472,951

289,486

7,944

18,199279,230

185,202

11,001

94,028

190,413,992

27,694,606

7,454,592

210,654,006－－

210,654,006

1,865

－

－

1,865

Structures intrust
Machineryandequipment in
trust
Tools,
furniture andfixtures intrust
Land in trust
Constructionin progress intrust
Subtotal

16,153

1,865

16,153

287,186,578

35,714,310

10,985,004

311,915,884

39,749,162

1,100,077

272,166,722

Total

489,286,317

36,327,231

16,941,036

508,672,512

62,460,083

2,127,783

446,212,429

Intangible Assets
Leasehold
right
Other

11,801,831－－

11,801,831－－

11,801,831

6,134

－

750

5,384

3,076

418

2,307

Total

11,807,965－

750

11,807,215

3,076

418

11,804,138

Remarks

Propertyacquisitionand sale

Propertyacquisitionand sale(Note 1) The “Increase during the Period” is due to property acquisition and construction works, etc. For buildings in trust, machinery and equipment in trust and land in trust,the increase is partly due to transfer from real estate to beneficiary interests in trust as a result of concluding additional entrustment agreements.
(Note 2) The “Decrease during the Period” is due to the transfer to relevant accounts as a result of construction completion for construction in progress in trust, and due toproperty sale, etc. for buildings in trust, structures in trust, machinery and equipment in trust, tools, furniture and fixtures in trust, land in trust and other. For buildings,
machinery and equipment and land in trust, the decrease is due to transfer from real estate to beneficiary interests in trust as a result of concluding additional
entrustment agreements.

4) Schedule of Other Specified Assets
VolumeUnit Price(thousandsof yen)Amount(thousandsof yen)Unit Price(thousandsof yen)Amount(thousands ofyen)Profit andLoss from
Valuation(thousands of
yen)

1

－

710

－

710

－

－

1

－

710

－

710

－

－

Book Value
Type of Asset

Issuer Name

Claim for refund of funds

GRAND FRONTOSAKA TMO,
a general incorporated
association

Total(Note) The appraisal value indicates the book value.

42

50

Appraisal Value (Note)

RemarksFinancial Statements

Japan Prime Realty Investment Corporation

5) Schedule of Investment Corporation Bonds

Decreaseduring the
Period(thousands ofyen)

Balance as ofDecember 31,
2021(thousands of
yen)

Name

Issue Date

Balance as ofJuly 1, 2021
(thousands ofyen)

Seventh Series ofInvestment Corporation
Bonds (Note 1)

Dec. 14, 2006

4,500,000－

4,500,000

2.900

Dec. 14, 2026

Eighteenth Series ofInvestment Corporation
Bonds (Note 1)

May 31, 2013

2,000,000－

2,000,000

1.460

May 31, 2023

Nineteenth Series ofInvestment Corporation
Bonds (Note 1)

Feb. 5, 2014

5,000,000－

5,000,000

1.110

Feb. 5, 2024

Twenty-first Series ofInvestment Corporation
Bonds (Note 1)

Jul. 22, 2014

4,000,000－

4,000,000

1.278

Jul. 22, 2026

Twenty-second Series ofInvestment Corporation
Bonds (Note 1)

Dec. 4, 2014

3,000,000－

3,000,000

0.831

Dec. 4, 2024

Twenty-third Series ofInvestment Corporation
Bonds (Note 1)

May 31, 2018

3,000,000－

3,000,000

0.550

May 31, 2028

Twenty-fourth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Jul. 31, 2019

5,000,000－

5,000,000

0.570

Jul. 31, 2029

Twenty-fifth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Nov. 26, 2020

6,000,000－

6,000,000

0.510

Nov. 26, 2030

Twenty-sixth Series ofInvestment Corporation
Bonds (Note 1)

Mar. 16, 2021

3,000,000－

3,000,000

0.760

Mar. 14, 2036

Twenty-seventh Series ofInvestment Corporation
Bonds (Sustainability
Bonds) (Note 1)

Dec. 7, 2021－－

1,400,000

0.420

Dec. 5, 2031

Twenty-eighth Series ofInvestment Corporation
Bonds (Green Bonds)(Note 1)

Dec. 7, 2021－－

1,000,000

0.670

Dec. 5, 2036

35,500,000－

37,900,000

Total

CouponRate
Maturity Date
(%)

Use

Security(Note 2)

Unsecured(Note 1) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.
(Note 2) Funds are used for purchasing real estate or real estate beneficiary interest in trust (including accompanying expenses), repaying loans payable and redeeming
investment corporation bonds, etc.
(Note 3) Amounts of investment corporation bonds to be redeemed within five years after the date of the Balance Sheets are as follows.
Due in One YearDue after One YearDue after Two Years
Due after Three Yearsor Less
through Two Years
through Three Years
through Four Years(thousands of yen)(thousands of yen)(thousands of yen)(thousands of yen)

Investment corporation
bonds

－

2,000,000

51

8,000,000－

Due after Four Years
through Five Years(thousands of yen)

8,500,000

43Financial Statements

6) Schedule of Loans Payable
LenderJapan Prime Realty Investment Corporation

Increase
Balance as ofduringJuly 1,
Current
2021
Period(thousands(thousandsof yen)of yen)Decrease
Balance as ofduringDecember 31,
Current
2021
Period(thousands(thousandsof yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Jul.5, 2021

Use

Remarks

Short-Term Loans Payable
Mizuho Bank Ltd.

2,000,000－

2,000,000－

0.185%

Mizuho Bank Ltd. (Note 5)－

2,000,000

1,400,000

600,000

0.158%

Jul.5, 2022

Mizuho Bank, Ltd.

－7,400,000－

7,400,000

0.157%

Jul.5, 2022

Resona Bank, Ltd. (Note 6)－

2,000,000

1,000,000

1,000,000

0.157%

Jul.5, 2022－
2,000,000

3,000,000－

3,000,000

0.157%

Jul.5, 2022

14,400,000

4,400,000

12,000,000

Decrease
Balance as ofduringDecember 31,
Current
2021
Period(thousands(thousandsof yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Resona Bank, Ltd.
Total

LenderIncrease
Balance as ofduringJuly 1,
Current
2021
Period(thousands(thousandsof yen)of yen)(Note 4)

Use

Unsecured/
Unguaranteed

Remarks

Long-Term Loans Payable (Note 1)
Mizuho Bank Ltd.

5,000,000－－

5,000,000

1.178%

Jun. 27, 2023

Mizuho Bank Ltd.

2,000,000－－

2,000,000

1.011%

Mar. 11, 2024

Mizuho Bank Ltd.

2,000,000－－

2,000,000

1.056%

Mar. 24, 2025

Mizuho Bank Ltd.

5,000,000－－

5,000,000

0.804%

Feb. 4, 2026

Mizuho Bank Ltd.

4,000,000－－

4,000,000

0.400%

Mar. 30, 2022

Mizuho Bank Ltd.

1,000,000－－

1,000,000

0.795%

Nov. 19, 2027

Mizuho Bank Ltd.

2,000,000－－

2,000,000

0.646%

Dec. 5, 2029

Mizuho Bank Ltd.

3,000,000－－

3,000,000

0.675%

Mar. 31, 2031

MUFG Bank, Ltd.

1,000,000－－

1,000,000

0.873%

Aug. 31, 2023

MUFG Bank, Ltd.

5,000,000－－

5,000,000

0.510%

Mar. 25, 2024

MUFG Bank, Ltd.

2,000,000－－

2,000,000

0.633%

Dec. 13, 2024

MUFG Bank, Ltd.

1,000,000－－

1,000,000

0.638%

Aug. 8, 2025

MUFG Bank, Ltd.

5,000,000－－

5,000,000

0.600%

Aug. 29, 2025

MUFG Bank, Ltd.

3,000,000－－

3,000,000

0.593%

Sep. 5, 2025

MUFG Bank, Ltd.

4,000,000－－

4,000,000

0.450%

Jun. 23, 2028

Sumitomo Mitsui Banking Corporation

2,500,000－－

2,500,000

1.033%

Jun. 27, 2022

Sumitomo Mitsui Banking Corporation

4,000,000－－

4,000,000

0.400%

Mar. 30, 2022

Sumitomo Mitsui Banking Corporation

1,000,000－－

1,000,000

0.245%

Dec. 5, 2023

Sumitomo Mitsui Banking Corporation

3,000,000－－

3,000,000

0.300%

Jun. 26, 2025

Sumitomo Mitsui Banking Corporation

2,000,000－－

2,000,000

0.450%

Mar. 30, 2028

Development Bank of Japan, Inc.

2,000,000－

2,000,000－

1.188%

Dec. 3, 2021

Development Bank of Japan, Inc.

2,000,000－－

2,000,000

1.056%

Mar. 24, 2025

Development Bank of Japan, Inc.

3,000,000－－

3,000,000

0.843%

Jun. 14, 2027
Nov. 19, 2027

Development Bank of Japan, Inc.

1,000,000－－

1,000,000

0.795%Development Bank of Japan, Inc.

2,100,000－－

2,100,000

0.572%

Jun. 27, 2029

Development Bank of Japan, Inc.

800,000－－

800,000

0.600%

Jun. 25, 2030

Development Bank of Japan, Inc.

－

2,000,000－

2,000,000

0.600%

Dec. 3, 2030

Shinsei Bank, Ltd.

2,000,000－－

2,000,000

1.134%

Dec. 5, 2024

Shinsei Bank, Ltd.

1,000,000－－

1,000,000

0.843%

Jun. 14, 2027

Shinsei Bank, Ltd.

5,000,000－－

5,000,000

0.673%

Apr. 5, 2029

Shinsei Bank, Ltd.

1,000,000－－

1,000,000

0.525%

Sep. 25, 2028

Shinsei Bank, Ltd.

1,000,000－－

1,000,000

0.675%

Sep. 24, 2030

Shinkin Central Bank

2,000,000－

2,000,000－

0.388%

Dec. 14, 2021

Shinkin Central Bank

3,000,000－－

3,000,000

0.663%

Jun. 4, 2027

Shinkin Central Bank

2,000,000－－

2,000,000

0.447%

Dec. 27, 2027

Shinkin Central Bank－

2,000,000－

2,000,000

0.525%

Dec. 14, 2029

The Norinchukin Bank

2,000,000－

2,000,000－

0.388%

Dec. 14, 2021

The Norinchukin Bank

1,000,000－－

1,000,000

0.604%

Jun. 5, 2025

The Norinchukin Bank

2,000,000－－

2,000,000

0.405%

Jun. 25, 2027

The Norinchukin Bank

2,000,000－－

2,000,000

0.525%

Dec. 25, 2028

The Norinchukin Bank－

2,000,000－

2,000,000

0.525%

Dec. 14, 2029

Mizuho Trust & Banking Co., Ltd.

3,000,000－－

3,000,000

0.586%

Feb. 4, 2030

Mizuho Trust & Banking Co., Ltd.

2,000,000－－

2,000,000

0.606%

Mar. 29, 2030

Mizuho Trust & Banking Co., Ltd.

2,000,000－－

2,000,000

0.675%

Dec. 24, 2030

4452

(Note 4)

Unsecured/
UnguaranteedFinancial Statements

LenderJapan Prime Realty Investment Corporation

Increase
Balance as ofduringJuly 1,
Current
2021
Period(thousands(thousandsof yen)of yen)Decrease
Balance as ofduringDecember 31,
Current
2021
Period(thousands(thousandsof yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Oct. 6, 2023

Use

Remarks

Long-Term Loans Payable (Note 1)
The Bank of Fukuoka, Ltd.

2,000,000－－

2,000,000

0.816%The Bank of Fukuoka, Ltd.

2,000,000－－

2,000,000

0.480%

Jul. 7, 2026

The Bank of Fukuoka, Ltd.

1,000,000－－

1,000,000

0.554%

Sep. 21, 2029

The Bank of Fukuoka, Ltd.

Jan. 30, 2030

1,000,000－－

1,000,000

0.598%

Aozora Bank Ltd.

900,000－－

900,000

0.625%

Jul. 3, 2025

Aozora Bank Ltd.

1,000,000－－

1,000,000

0.534%

Aug. 23, 2024

Aozora Bank Ltd.

1,000,000－－

1,000,000

0.574%

Feb. 25, 2025

Aozora Bank Ltd.

2,000,000－－

2,000,000

0.553%

Feb. 25, 2025

Aozora Bank Ltd.

500,000－－

500,000

0.525%

Sep. 25, 2028

Meiji Yasuda Life Insurance Company

1,000,000－－

1,000,000

1.042%

Feb. 5, 2025

Meiji Yasuda Life Insurance Company

3,200,000－－

3,200,000

0.813%

Jun. 21, 2028

Sumitomo Life Insurance Company

2,000,000－－

2,000,000

0.453%

Oct. 11, 2024

Sumitomo Life Insurance Company

1,000,000－－

1,000,000

0.583%

Jul. 20, 2029

Sumitomo Life Insurance Company

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The Shinkumi Federation Bank

4,000,000－－

4,000,000

0.404%

Aug. 5, 2022

The Nishi-Nippon City Bank, Ltd.

3,000,000－－

3,000,000

0.646%

May 27, 2026

The Nishi-Nippon City Bank, Ltd.

1,000,000－

1,000,000－

0.388%

Dec. 14, 2021

The Nishi-Nippon City Bank, Ltd.

－

1,000,000－

1,000,000

0.525%

Dec. 14, 2029

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.969%

Sep. 24, 2024

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.811%

Jun. 5, 2028

Taiyo Life Insurance Company

1,000,000－－

1,000,000

0.675%

Dec. 24, 2030

The Chugoku Bank, Ltd.

2,000,000－－

2,000,000

0.816%

Oct. 6, 2023

The Chugoku Bank, Ltd.

1,000,000－－

1,000,000

0.661%

Mar. 25, 2026

The Iyo Bank, Ltd.

1,000,000－－

1,000,000

0.816%

Oct. 6, 2023

The Iyo Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

Sompo Japan Insurance Inc.

2,000,000－－

2,000,000

0.759%

Dec. 25, 2023

Nippon Life Insurance Company

2,000,000－－

2,000,000

0.225%

Nov. 22, 2023

The Hachijuni Bank, Ltd.

1,000,000－

1,000,000－

0.209%

Sep. 24, 2021

The Hachijuni Bank, Ltd.

1,000,000－－

1,000,000

0.300%

Oct. 9, 2025

The Hachijuni Bank, Ltd.

－

1,000,000－

1,000,000

0.310%

Sep. 24, 2026

The Yamaguchi Bank, Ltd.

1,000,000－－

1,000,000

0.795%

Nov. 19, 2027

The Yamaguchi Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

Resona Bank, Ltd.

2,000,000－－

2,000,000

0.438%

Sep. 30, 2022

NTT FINANCE CORPORATION

1,000,000－－

1,000,000

0.408%

May 31, 2023

The Kiyo Bank, Ltd.

1,000,000－－

1,000,000

0.598%

Jan. 30, 2030

The 77 Bank, Ltd.

1,000,000－－

1,000,000

0.408%

May 31, 2023

Daishi Hokuetsu Bank, Ltd.

1,000,000－－

1,000,000

0.396%

Nov. 21, 2022

Daido Life Insurance Company

1,000,000－－

1,000,000

0.316%

Dec. 25, 2023

The Chiba Bank, Ltd.

1,000,000－－

1,000,000

0.449%

Oct. 25, 2023

Tokio Marine & Nichido Fire InsuranceCo., Ltd.

1,000,000－－

1,000,000

0.299%

Jun. 27, 2023

The Hyakugo Bank, Ltd.

1,000,000－－

1,000,000

0.582%

Apr. 25, 2025

The Hiroshima Bank, Ltd.

1,000,000－－

1,000,000

0.396%

Nov. 21, 2022

Mitsui Sumitomo Insurance Company,
Limited1,000,000－－

1,000,000

0.310%

Oct. 2, 2026

Sumitomo Mitsui Trust Bank Limited

1,000,000－－

1,000,000

0.691%

Mar. 25, 2026

The Yamanashi Chuo Bank, Ltd.

1,000,000－－

1,000,000

0.600%

Apr. 30, 2030

National Mutual Insurance Federation ofAgricultural Cooperatives

2,000,000－

2,000,000－

0.388%

Dec. 14, 2021

Total

159,000,000

8,000,000 10,000,000

157,000,000(Note 1) Amounts of long-term loans payable to be repaid within five years after the date of the Balance Sheets are as follows.
Due in One YearDue after One YearDue after Two Years
Due after Three Yearsor Less
through Two Years
through Three Years
through Four Years(thousands of yen)(thousands of yen)(thousands of yen)(thousands of yen)
Long-term loans payable

18,500,000

21,000,000

15,000,000

23,900,000(Note 4)

Unsecured/
Unguaranteed

Due after Four Years
through Five Years(thousands of yen)

14,000,000(Note 2) The average interest rates represent the weighted-averages during the fiscal period, and are rounded to the third decimal place. Furthermore, fees related to loanarrangement paid to the above lenders are not included.
(Note 3) Short-term loans payable are floating-rate loans payable. Long-term loans payable are fixed-rate loans payable.

53

45

Financial Statements

Japan Prime Realty Investment Corporation(Note 4) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redeeming
investment corporation bonds, etc.
(Note 5) Of the 2,000 million yen in short-term loans payable that was borrowed on July 5, 2021 from Mizuho Bank, Ltd., JPR made early repayment of 1,400 million yen
on December 7, 2021.
(Note 6) Of the 2,000 million yen in short-term loans payable that was borrowed on October 28, 2021 from Resona Bank, Ltd., JPR made early repayment of 1,000 million
yen on December 7, 2021.

46

54

Financial Statements

Japan Prime Realty Investment Corporation(8) Independent Auditor’s Report55

Financial Statements

Japan Prime Realty Investment Corporation

56

Financial Statements

Japan Prime Realty Investment Corporation

57

Financial Statements

Japan Prime Realty Investment Corporation

OtherNotes
Notes(Information(Information only)
only)(9)(9)
Other

24.

(Property and Equipment Leased to JPR)
39th Fiscal Period(January 1, 2021 – June 30, 2021)

40th Fiscal Period(July 1, 2021 – December 31, 2021)

No property and equipment was leased to JPR

No property and equipment was leased to JPR(Transactions with Interested Parties)
39th fiscal period (January 1, 2021 – June 30, 2021)
Attribute

Name ofCompany,etc.

Business
Description or
Occupation

Percentage of Numberof Investment Units
Held Among Total
Number of Investment
Units

Interested
party

Tokyo
TatemonoCo., Ltd.

Real estatebusiness

3.05%

Asset
CustodianMizuho Trust& BankingCo., Ltd.

Bankingbusiness andtrust business－Transactions

Sale ofreal estate
beneficiaryinterest
Borrowing of
long-term loans
payableInterest
expenses

Transaction
Amount(thousands ofyen)

2,665,000－
21,422

Account－
Long-term
loans
payableAccruedexpenses

Balance at End
of Period(thousands ofyen)－

7,000,000
591(Note) Transaction terms are determined based on prevailing market conditions.

40th fiscal period (July 1, 2021 – December 31, 2021)
Attribute

Interested
party

Asset
CustodianName ofCompany,
etc.

Tokyo
TatemonoCo., Ltd.

Mizuho Trust& BankingCo., Ltd.

Business
Description or
Occupation

Real estatebusiness

Bankingbusiness andtrust business

Percentage of Numberof Investment Units
Held Among Total
Number of Investment
Units

3.05%

－

(Note) Transaction terms are determined based on prevailing market conditions.

48

58

Transactions

Purchase ofreal estate
beneficiaryinterest
Sale ofreal estate
beneficiaryinterest
Borrowing of
long-term loans
payableInterest
expenses

Transaction
Amount(thousands ofyen)

Account

Balance at End
of Period(thousands ofyen)

21,300,000－－

3,600,000－－－
21,777Long-term
loans
payableAccruedexpenses

7,000,000
473