Disclaimers
This document has been prepared solely for the purpose of providing U.K. and Dutch
investors with certain information under Article 23 of the European Alternative
Investment Fund Managers Directive (European Directive 2011/61/EU) (the “AIFMD”) as
implemented in their respective jurisdictions. Accordingly, you should not use thisdocument for any other purpose.
Netherlands
The units of Japan Prime Realty Investment Corporation (“JPR” or the “AIF”) are being
marketed in the Netherlands in accordance with Section 1:13b of the Dutch Financial
Supervision Act (Wet op het financieel toezicht, or the “Wft”). In accordance with thisprovision, Tokyo Tatemono Realty Investment Management, Inc. (the “AIFM”) has
notified the Dutch Authority for the Financial Markets (Autoriteit Financiële Markten, the“AFM”) of its intention to offer these units in the Netherlands. This document is notaddressed to or intended for and the units of JPR have not been and may not be, directly or
indirectly, be offered, sold, transferred or delivered in the Netherlands, except to or byindividuals or entities that are qualified investors (gekwalificeerde beleggers) within themeaning of Article 1:1 of the Wft. As a consequence, neither the AIFM nor JPR is subject
to the license requirement for investment institutions (beleggingsinstellingen) or their
managers pursuant to the Wft. Consequently, the AIFM and JPR are only subject to thesupervision of the Dutch Central Bank (De Nederlandsche Bank, “DNB”) or the AFM forthe compliance with the ongoing regulatory requirements as referred to in the Dutch law
implementation of article 42 of the AIFMD. According to Article 23 the prospectus is not
subject to approval by the AFM. No approved prospectus is required to be published in the
Netherlands pursuant to Article 3 of the Regulation (EU) 2017/1129 (the “Prospectus
Regulation”) as amended and applicable in the Netherlands.
United Kingdom
Units of JPR are being marketed in the United Kingdom pursuant to Article 59 of theUnited Kingdom Alternative Investment Fund Managers Regulations 2013. In accordancewith this provision, the AIFM has notified the Financial Conduct Authority (the “FCA”)
of its intention to offer these units in the United Kingdom.
For the purposes of the United Kingdom Financial Services and Markets Act 2000 (asamended, “FSMA”) JPR is an unregulated collective investment scheme which has notbeen authorized by the FCA.

1

Accordingly, any communication of an invitation or inducement to invest in JPR may only
be made to (i) investment professionals falling within Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended, or “theOrder”; or (ii) high net worth companies falling within Articles 49(2)(a) to (d) of the Orderand other persons to whom it may lawfully be communicated (all such persons referred tounder (i) and (ii) of this paragraph, together being referred to as “Relevant Persons”).
In the United Kingdom, this document and its contents are directed only at Relevant
Persons and must not be acted on or relied on by persons who are not Relevant Persons.
The transmission of this document and its contents in the United Kingdom to any person
other than a Relevant Person is unauthorized and may contravene the FSMA and other
United Kingdom securities laws and regulations.
Prohibition of Sales to UK Retail Investors
In addition to the restrictions under the AIFMD, as retained by the United Kingdom in its
domestic laws, the Units of JPR are not intended to be offered, sold or otherwise madeavailable to and should not be offered, sold or otherwise made available to any retailinvestor in the United Kingdom. For these purposes of this provision, a “retail investor”
means a person who is one (or more) of: (i) a retail client, as defined in point (8) of Article
2 of Regulation (EU) No 2017/565 as it forms part of domestic law by virtue of theEuropean Union (Withdrawal) Act 2018 (“EUWA”); or (ii) a customer within the meaningof the provisions of the FSMA and any rules or regulations made under the FSMA to
implement Directive (EU) 2016/97, where that customer would not qualify as aprofessional client, as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014
as it forms part of domestic law by virtue of the EUWA; or (iii) not a qualified investor as
defined in Article 2 of Regulation (EU) 2017/1129, as it forms part of domestic law byvirtue of the EUWA; and the expression “offer” includes the communication in any formand by any means of sufficient information on the terms of the offer and the international
units to be offered so as to enable an investor to decide to purchase or subscribe theinternational units.
Consequently no key information document required by Regulation (EU) No 1286/2014,as it forms part of domestic law by virtue of the EUWA (the “UK PRIIPs Regulation”), foroffering or selling the international units or otherwise making them available to retailinvestors in the United Kingdom has been prepared and therefore offering or selling theinternational units or otherwise making them available to any retail investor in the United
Kingdom may be unlawful under the UK PRIIPs Regulation.

2

European Economic Area
In addition to the restrictions under the AIFMD, the Units of JPR are not intended to beoffered, sold or otherwise made available to and should not be offered, sold or otherwise
made available to any retail investor in the European Economic Area (“EEA”). For these
purposes, a retail investor means a person who is one (or more) of: (i) a retail client as
defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”);(ii) a customer within the meaning of Directive(EU) 2016/97, where that customer would
not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or(iii) not a qualified investor as defined in the Prospectus Regulation, as amended.
Consequently no key information document required by Regulation (EU) No 1286/2014(the “PRIIPs Regulation”) for offering or selling the Units of JPR or otherwise making
them available to retail investors in the EEA has been prepared and therefore offering or
selling the Units of JPR or otherwise making them available to any retail investor in the
EEA may be unlawful under the PRIIPs Regulation.

3

Article 23 (1)(a)Objectives of the AIF

With the fundamental concept of "investment in urban commercial real estate," JPR invests
primarily in real estate comprising superior urban office buildings (urban commercial
facilities), retail properties found in thriving commercial areas, multi-use facilities and theland on which they are located, as well as in asset-backed securities that have such realestate as their primary investments. In addition, in consideration of returns and risks ofthese investment targets, JPR operates pursuant to a basic policy of investing not only inTokyo, but also in other regional cities to maximize the benefits from its portfolio
management.

Investment strategy

JPR is resolved to continuously work on investment focused on office properties in Tokyo inorder to enhance its growth potential over the long term, while conducting vigorously
selective investment in retail properties as well as office properties in regional cities thatare expected to generate relatively high yields. In addition, JPR seeks to invest in hotels inbusy areas that are expected to attract business travelers or tourists.

Types of assets theReal estate, trust beneficiary interests in real estate, real estate securities, specified assets

AIF may invest in

and other assets.

Techniques it may

JPR focuses on investing in office properties in Tokyo, which allows expectations for more

employ and all

stable occupancy and higher rent levels, and are believed to offer large rooms for an

associated risks

upward turn of rents when the leasing market starts to recover.
The principal risks with respect to investment in JPR are as follows:•

any adverse conditions in the Japanese economy could adversely affect JPR;•

an epidemic such as SARS, MERS and COVID-19 may have a significant long-term
adverse impact on economic activities, including as a result of self-isolation
measures, which in turn may adversely affect the performance of the portfolio andmarket price of the units;•

JPR may not be able to acquire properties to execute the growth and investment
strategy in a manner that is accretive to earnings;•

illiquidity in the real estate market may limit the ability to grow or adjust theportfolio;•

the past experience of the asset manager (the “AIFM”) in the Japanese real estatemarket is not an indicator or guarantee of the future results;•

JPR’s reliance on JPR’s related parties, sponsors, the AIFM and other third party
service providers could have a material adverse effect on its business;•

JPR may change its detailed investment policy without a formal amendment of thearticles of incorporation.

•

there are potential conflicts of interest between JPR, JPR’s related parties andsponsors as well as the AIFM;

4

•

JPR’s revenues largely comprise leasing revenues from the portfolio properties,
which may be negatively affected by factors including vacancies, decreases in rent,
and late or missed payments by tenants;•

JPR may suffer the circumstances of a single tenant because JPR invests incommercial buildings many of which are used by a single tenant;•

JPR’s may be exposed to hotel-specific risks, including from reliance on hotel
operators and difficulty of converting hotels for other uses;•

JPR faces significant competition in seeking tenants and it may be difficult to findreplacement tenants;•

increases in interest rates may increase the interest expense and may result in a
decline in the market price of the units;•

JPR may suffer large losses if any of the properties incurs damage from a natural or
man-made disaster;•

properties in the portfolio may be concentrated in certain areas;•

any inability to obtain financing from issuance of investments units, loan andissuance of investment corporation bonds for future acquisitions could adversely
affect the growth of the portfolio;•

JPR’s failure to satisfy a complex series of requirements pursuant to Japanese tax
regulations would disqualify JPR from certain taxation benefits and significantly
reduce the cash distributions to the unitholders;•the ownership rights in some of the properties may be declared invalid or limited;
and•execution of JPR’s external growth strategy based on support from sponsors may
not achieve the anticipated results.

In addition, JPR is subject to the following risks:•

risks related to increasing operating costs;•

risks related to JPR’s dependence on the efforts of the AIFM’s key personnel;•risks related to the restrictive covenants under debt financing arrangement;•risks related to entering into forward commitment contracts;•

risks related to third party leasehold interests in the land underlying JPR’s
properties;•risks related to holding property in the form of compartmentalized ownership(kubun shoyū) interests or co-ownership interests (kyōyū-mochibun);•risks related to holding property in the form of limited proprietary right of land (asit called “soko-chi”)•

risks related to holding property on sites designated as provisionally allocated land
(kari kanchi);•risks related to holding property through trust beneficiary interests;5•risks related to properties not in operation (including properties underdevelopment);•risks related to the defective title, design, construction or other defects or
problems in the properties including non-conformity to agreements;•

risks related to suffering impairment losses relating to the properties;•risks related to decreasing tenant leasehold deposits and/or security deposits;•risks related to tenants’ default as a result of financial difficulty or insolvency;•

risks related to the insolvency of the master lessee;•risks related to acquisition of property from an insolvent seller;•

risks related to relying on expert appraisals and engineering, environmental andseismic reports as well as industry and market data;•risks related to the presence of hazardous or toxic substances in the properties, orthe failure to properly remediate such substances;•risks related to the strict environmental liabilities for the properties;•risks related to the amendment of the applicable administrative laws and local
ordinances;•risks related to holding interests in properties through preferred shares of special
purpose companies (tokutei mokuteki kaisha);•risks related to investments in trust beneficiary interests;•

risks related to the tight supervision by the regulatory authorities and compliancewith applicable rules and regulations;•

regulatory and financial risks related to climate change, including as a result of
global warming countermeasures;•risks related to the tax authority disagreement with the AIFM’s interpretations of
the Japanese tax laws and regulations;•risks related to being unable to benefit from reductions in certain real estate taxes
enjoyed by qualified J-REITs;•

risks related to changes in Japanese tax laws; and•the risk of dilution as a result of further issuances of units; and•risks related to the difference between unitholders' rights and shareholders' rights;•

risks related to the AIFM's management of multiple J-REITs;•

risks related to global warming countermeasures;•risk related to an increase in tax burden due to discrepancies between accounting
treatment and tax treatment; and•risks related to future acquisitions and transfers of properties.

Any applicable

JPR is subject to investment restrictions under Japanese laws and regulations (e.g., the Act

investment

on Investment Trusts and Investment Corporations (the “ITA”), the Financial Instruments

restrictions

and Exchange Act (the “FIEA”)) as well as its articles of incorporation.

6

JPR must invest primarily in specified assets as defined in the ITA. Specified assets include,
but are not limited to, securities, real estate, leaseholds of real estate, surface rights (chijōken) (i.e., right to use land for the purpose of having a structure on it) or trust beneficiaryinterests for securities or real estate, leaseholds of real estate or surface rights.
Furthermore, a listed J-REIT must invest substantially all of its assets in real estate, realestate-related assets and liquid assets as provided by the listing requirements. Real estatein this context includes, but is not limited to, real estate, leaseholds of real estate, surface
rights, and trust beneficiary interests for these assets, and real estate-related assets in thiscontext include, but are not limited to, anonymous association (tokumei kumiai) interests
for investment in real estate.
Pursuant to the ITA, investment corporations may not independently develop land for
housing or to construct buildings, but may outsource such activities in certain
circumstances.
Circumstances in

JPR may take out loans or issue long-term or short-term investment corporation bonds forwhich the AIF may use the purpose of investing in properties, conducting repairs, paying cash distributions,leverage

repaying obligations (including repayment of tenant leasehold or security deposits, andobligations related to loans or long-term or short-term investment corporation bonds) andother activities.

The types and sources

Loans or investment corporation bonds. JPR currently does not have any outstandingof leverage permitted

guarantees, but may be subject to restrictive covenants in connection with any future

and associated risks

indebtedness that may restrict the operations and limit the ability to make cash
distributions to unitholders, to dispose of the properties or to acquire additional properties.
Furthermore, JPR may violate restrictive covenants contained in the loan agreements JPR
executes, such as the maintenance of debt service coverage or loan-to-value ratios, which
may entitle the lenders to require JPR to collateralize the properties or demand that theentire outstanding balance be paid. Further, in the event of an increase in interest rates, tothe extent that JPR has any debt with unhedged floating rates of interest or JPR incurs new
debt, interest payments may increase, which in turn could reduce the amount of cash
available for distributions to unitholders. Higher interest rates may also limit the capacity
for short- and long-term borrowings, which would in turn limit the ability to acquire
properties, and could cause the market price of the units to decline.

Any restrictions on

The maximum amount of each loan and investment corporation bond issuance will be one

leveragetrillion yen, and the aggregate amount of all such debt will not exceed one trillion yen.

Any restrictions on

No applicable restrictions.

collateral and asset
reuse arrangements

7Maximum level of

JPR has set an upper limit of 55% as a general rule for its loan-to-value, or LTV, ratio in orderleverage which theto operate with a stable financial condition. Additionally, JPR strives to maintain its LTV at

AIFM is entitled to

not more than 50%. JPR may, however, temporarily exceed any such levels as a result of

employ on behalf ofproperty acquisitions or other events.

the AIF
Article 23(1) (b)Procedure by which

Amendment of the articles of incorporation. Amendment requires a quorum of a majority

the AIF may changeof the total issued units and at least a two-thirds vote of the voting rights represented at

its investment

the meeting. Unitholders should note, however, that under the ITA and our articles ofstrategy / investment

incorporation, unitholders who do not attend and exercise their voting rights at a generalpolicymeeting of unitholders are deemed to be in agreement with proposals submitted at themeeting, except in cases where contrary proposals are also being submitted.
Additionally, the guidelines of the AIFM, which provide more detailed policies within JPR’s
overall investment strategy and policy, can be modified without such formal amendment of
the articles of incorporation.

Article 23(1) (c)Description of the

JPR is a corporate-type investment trust in the form of investment corporation (toshi hojin)

main legal

provided for under the ITA. Therefore, the relationship between JPR and its unitholders is

implications of thegoverned by JPR’ articles of incorporation (as opposed to individual agreements), which cancontractual

be amended from time to time upon resolution of a general unitholders’ meeting. JPR’relationship entered

articles of incorporation stipulate rules relating to general unitholders’ meetings, including

into for the purposethe convocation, setting of record date, exercise of voting rights, resolutions and election ofof investment,

JPR’ directors. The relationship between JPR and its unitholders is also governed by, and isincluding jurisdiction,subject to the provisions of, Japanese law, including the ITA.

applicable law, andthe existence or notof any legal
instruments providing
for the recognitionand enforcement of
judgments in the
territory where the
AIF is establishedThe courts in Japan would recognize as a valid judgment any final and conclusive civil
judgment for monetary claims (which, for this purpose, are limited to those of a purely civil
nature and do not include monetary claims of the nature of criminal or administrative
sanction, such as punitive damages, even though they take the form of civil claims) against
JPR obtained in a foreign court provided that (i) the jurisdiction of such foreign court isadmitted under the laws of Japan, (ii) JPR has received service of process for thecommencement of the relevant proceedings, otherwise than by a public notice or any
method comparable thereto, or has appeared without any reservation before such foreign
court, (iii) neither such judgment nor the relevant proceeding is repugnant to public policy
as applied in Japan, (iv) there exists reciprocity as to the recognition by such foreign court ofa final judgment obtained in a Japanese court and (v) there is no conflicting judgement on
the subject matter by any Japanese court.

8JPR has entered into the following agreements with Tokyo Tatemono Co., Ltd.:•

Open tenant agent agreement;•

Property management agreements

JPR has entered into the following agreements with several sponsors other than Tokyo
Tatemono Co., Ltd. (its sponsors are Tokyo Tatemono Co., Ltd., Taisei Corporation, Yasuda
Real Estate Co., Ltd. and Meiji Yasuda Life Insurance Company):•

Open tenant agent agreement with Taisei Corporation;•

Open tenant agent agreement with Yasuda Real Estate Co., Ltd.

JPR has entered into the following agreements with Mizuho Trust & Banking Co., Ltd.:•A custody and administrative agent agreement regarding JPR’s assets;•

A transfer agent agreement regarding the units

JPR has entered into various agreements related to JPR’s investment corporation bondofferings with Mizuho Bank, Ltd.
All of the above agreements are governed by Japanese law.
JPR is not involved in or threatened by any legal arbitration, administrative or otherproceedings, the results of which might, individually or in the aggregate, be material.
Article 23(1) (d)The identity of the• AIFM (Asset Manager): Tokyo Tatemono Realty Investment Management, Inc.

AIFM, AIF's

The AIFM manages and operates the operating assets.

depositary, auditor
and any other service• Auditor: Ernst & Young ShinNihon LLC

providers and a

The auditor audits financial statements and prepare audit reports.

description of theirduties and the• Custodian and Transfer Agent: Mizuho Trust & Banking Co., Ltd.

investors' rights• General Administrators: Mizuho Trust & Banking Co., Ltd.

theretoThe custodian provides administrative services related to custody of assets.
The general administrator provides administrative services related to unitholders’ roster,investment units and management of institutions.

Service providers owe contractual obligations under their respective agreements with the
AIF or AIFM, as the case may be. In addition, the FIEA provides that the Asset Manager
owes the AIF a fiduciary duty and must conduct its activities as the asset manager in goodfaith.

9

The FIEA also prohibits the Asset Manager from engaging in certain specified conduct,
including entering into transactions outside the ordinary course of business or with relatedparties of the Asset Manager that are contrary to or violate the AIF’s interests.
Pursuant to the ITA, the unitholders have the right to approve the execution or terminationof the asset management agreement at a general meeting of unitholders.
Article 23(1) (e)Description of how

Not applicable.

the AIFM complies
with the requirements
to cover professional
liability risks (ownfunds / professional
indemnity insurance)
Article 23(1) (f)Description of any
delegatedmanagement function

Not applicable.
There is no delegation of such functions beyond the AIFM, which is responsible for portfolio
and risk management, and the Custodian, which is responsible for safekeeping activities.

such as portfolio
management or risk
management and of
any safekeeping
function delegated by
the depositary, theidentification of thedelegate and any
conflicts of interest
that may arise fromsuch delegations
Article 23(1) (g)Description of the

JPR makes investment decisions based on the valuation of properties, upon consideration of

AIF’s valuation

the property appraisal value.

procedure and pricing
methodology,
including the methods
used in valuing hardto-value assets

JPR shall evaluate assets in accordance with its Article of Incorporation. The methods andstandards that JPR uses for the evaluation of assets shall be based on the Regulations
Concerning the Calculations of Investment Corporations, as well as the Regulations
Concerning Real Estate Investment Trusts and Real Estate Investment Corporations andother regulations stipulated by ITA, in addition to Japanese GAAP.

10J-REITs may only use the valuation methods prescribed in the rules of the Investment Trusts
Association, Japan, which emphasize market price valuation.
Article 23(1) (h)Description of the
AIF’s liquidity risk
management,
including redemption
rights in normal andexceptional

The AIFM stipulates basic provisions of risk management in its risk management rules.
Additionally, the AIF uses various financing methods, including investment corporation
bonds and long-term loans, to finance acquisitions and repayment obligations. JPR controls
related risk by maintaining the ratio of interest-bearing debt to total assets under a certain
percentage, diversifying repayment deadlines, and retaining a certain amount of highly
liquid cash and deposits.

circumstances andexisting redemption
arrangements withinvestors

For floating rate borrowings exposed to the risk of interest rate fluctuations, JPR closely
monitors the movement of interest rates, and intends to increase the proportion of its
obligations subject to fixed rate loans and similar instruments.
Risks related to deposits are managed through the use of liquid deposits.
As JPR is a closed-end investment corporation, unitholders are not entitled to request theredemption of their investment.

Article 23(1) (i)Description of all fees,

Compensation: The articles of incorporation provide that JPR may pay its executive officer

charges and expenses

and each of the supervisory officers up to 400,000 to 500,000 yen per month. The board ofand a maximum

officers is responsible for determining a reasonable compensation amount for the executive

amount which is

officer and each of the supervisory officers.

directly / indirectly
borne by the investors Asset Manager:• Asset Management Fee: JPR will pay the Asset Manager an asset management fee asfollows:

1. Management Fee #1
The amount is the total of the values in (1) to (4) below (any amount less than 1 yen
will be truncated).
(1) Total acquisition price x 0.045%(2) Total acquisition price x 0.002% x multiplier determined based on the percentageof GHG emission reduction(3) Acquisition price of each portfolio asset x 0.001% x multiplier determined based on
the property certification evaluation(4) Total acquisition price x 0.001% x multiplier determined based on the GRESB
evaluation11

* Acquisition price shall be the acquisition price of each portfolio asset at the end of
the immediately preceding fiscal period (excludes consumption tax, local
consumption tax or expenses associated with the acquisition). Total acquisition priceshall be the total amount of the acquisition prices of portfolio assets at the end of theimmediately preceding fiscal period.
* When the relevant fiscal period is less than six months, the fee shall be calculated
on a pro-rata basis based on the actual number of days.
* Management Fee #1 is payable within three months from the end of each fiscal
period.
2. Management Fee #2
The amount equivalent to 1.2% of JPR’s total revenue of the fiscal period (any amountless than 1 yen will be truncated).
* Total revenue shall be the total of rent revenue, common charges, parking revenue,
incidental income, fee for use of facilities, installation fees, late charges, cancellation
penalty arising from cancellation of lease and any other income, interest or
distribution arising from our real estate assets and other related income from therent business.
* Management Fee #2 is payable within three months from the end of each fiscal
period.
3. Management Fee #3
The amount equivalent to the distributable base amount x 3.8% x variance in the
distributable base amount per unit (any amount less than 1 yen will be truncated).
* The distributable base amount shall be income before income taxes prior todeduction of Management Fee #3 as of the end of the relevant fiscal period and nondeductible consumption taxes (it does not include gain or loss on sale, gain on
exchange or loss on exchange, or other gain or loss related to the transfer of portfolio
assets).
* Variance in the distributable base amount per unit shall be the distributable baseamount per unit for the relevant fiscal period, divided by the average of the
distributable base amount per unit for the most recent three fiscal periods exclusiveof the relevant fiscal period. The distributable base amount per unit for a fiscal period
shall be calculated by dividing the distributable base amount by the total number ofunits issued at the end of such fiscal period (excluding any treasury units that areunappropriated or unamortized at the end of any fiscal period).

12

* In addition, if any of the following circumstances become effective and the total
number of units issued increases or decreases in the most recent four fiscal periods
inclusive of the relevant fiscal period, the total number of units issued at the end ofeach fiscal period for the most recent four fiscal periods inclusive of the relevant
fiscal period shall be adjusted by the following methods to factor out the impact ofsuch increase or decrease on distributable base amount per unit:(i) Unit consolidation or split
The total number of units issued at the end of each fiscal period shall be
adjusted for any unit consolidation or split conducted in the most recent four
fiscal periods by treating it as if it became effective at the beginning of the mostrecent four fiscal periods inclusive of the relevant fiscal period.
(ii) Issuance of new units upon exercise of options allotted to unitholders for no
consideration
The number of units issued upon any exercise, multiplied by the amountcalculated by dividing the relevant exercise price per unit (or an equivalent pricedetermined at a meeting of the board of directors) by the market price per unit,
shall be deemed to be new units issued at the market price. The number of newunits issued upon any such exercise, minus such number of units deemed tohave been issued at the market price, will be treated as if issued pursuant to aunit split, and the rule described in (i) shall apply.
* Variation of the distributable base amount per unit shall be no less than 80% and no
more than 120%.
*Management Fee #3 is payable within three months from the end of each fiscal
period.
4. Management Fee #4
For each real estate property or security that is primarily backed by real estate that
JPR acquires, the Asset Manager receives a fee equal to 0.1% (or 0.5% in the case of
acquisition from a related party as defined in the Board of Director’s Regulations) of
the acquisition price (net of any acquisition costs, consumption tax and local
consumption tax) (any amount less than 1 yen will be truncated).
If the Asset Manager conducts an investigation and valuation of the assets held by
the counterparty to a consolidation-type merger or an absorption-type merger
involving JPR (regardless of whether JPR is the corporation surviving the absorptiontype merger or the corporation disappearing in the absorption-type merger) or othermerger-related services for JPR and the merger becomes effective, the amountequivalent to 0.5% of the total appraisal value as of the effective date of the merger

13

of the real estate-related assets held by the counterparty to the merger that are
succeeded to or held by the corporation incorporated in the consolidation-typemerger or the corporation surviving the absorption-type merger (any amount lessthan 1 yen will be truncated).
*Management Fee #4 is payable by the end of the month immediately following themonth of acquisition.
5. Management Fee #5
The amount equivalent to 12.5% of the gain on sale of real estate, etc. (any amountless than 1 yen will be truncated).
* Gain on sale of real estate, etc. shall be the amount obtained in the event of thesale of a real estate-related asset when the book value at the time of sale and sale
expenses before recognition of Management Fee #5 are deducted from the sale price.
Management Fee #5 does not arise if this amount is negative. The fee amount iscalculated for each asset sold.
* The amount obtained when the sale price is multiplies by 0.5% shall be theminimum fee and the fee amount shall be whichever is larger out of the amountcalculated in accordance with the above and the minimum fee, provided that, if theminimum fee is applied, the fee shall be not exceed the gain on sale of real estate,etc.
* Management Fee #5 is payable within three months after the end of fiscal period.
Custodian/ General Administrator:• Custodian Fee and General Administrators Fee: JPR will pay the Custodian/General
Administrator a fee per fiscal period calculated by adding the following amounts:
1. One-half of the amount of assets at the end of the previous fiscal period
multiplied by the following proportions.
Amount of Assets at End of thePrevious Fiscal Period

Rates(JPY billion)
Portions not exceeding 200

0.040%

Over 200 to 400

0.020%

Over 400 to 600

0.018%

Over 600

0.016%

14

2. One-half of the number of real estate properties held directly by JPR (notthrough a trust structure) at end of the previous fiscal period multiplied by anamount up to 1 million yen and determined through discussions among JPR,
the Custodian and General Administrator.
Transfer Agent:• Transfer Agent Fee (Standard Fee):
Standard transfer agent fees are for services such as preparation, maintenance andstorage of JPR’s unitholder register; preparation and reporting of the end-of-fiscal
period unitholders register and unitholder statistical data.
The monthly standard fees will be the total of the amount calculated using thefollowing table divided by 6, with a minimum monthly fee of 200,000 yen.
Number of Unitholders

Fees per Unitholder

first 5,000 unitholders

480 yenover 5,000 to 10,000

420 yenover 10,000 to 30,000

360 yenover 30,000 to 50,000

300 yenover 50,000 to 100,000

260 yenover 100,000

225 yen• Other fees:
JPR pays the transfer agent other fees for various other services, including inconnection with the issuance of dividends.
Auditor:• Auditor Fee:
JPR may pay the independent auditor up to 15 million yen per fiscal period. The board
of officers is responsible for determining the actual compensation amount.
The AIF may also incur other miscellaneous fees in connection with property management,
issuance of units, investment corporation bonds and the operation, acquisition or
disposition of properties.
Article 23(1) (j)Description of theUnder Article 77 paragraph 4 of the Act on Investment Trusts and Investment Corporations

AIFM's procedure toof Japan, which applies the requirements of Article 109 paragraph 1 of the Companies Act

ensure fair treatment

to investment corporations, investment corporations are required to treat unitholders

of investors andequally depending on the number and content of units held. In addition, upon liquidation,

details of any

15

preferential

the allotment of residual assets to unitholders is required to be made equally depending on

treatment received by

the number units held under Article 77 paragraph 2 item 2 and Article 158 of the ITA.

investors, including
detailing the type ofinvestors and theirlegal or economic
links with the AIF or
AIFM
Article 23(1) (k)The latest annual

Additional information may be found in our most recent semi-annual report prepared inreport referred to inaccordance with Article 22 of the AIFMD, which is available at the Asset Manager’s office

Article 22(1)located at 4-16 Yaesu 1-Chome, Chuo-ku, Tokyo.

Article 23(1) (l)The procedure and

JPR is authorized under the articles of incorporation to issue up to 5,000,000 units. Its units

conditions for thehave been listed on the Tokyo Stock Exchange since June 14, 2002.

issue and sale of theSecondary market sales and transfers of units will be conducted in accordance with theunitsrules of the Tokyo Stock Exchange. Unit prices on the Tokyo Stock Exchange are determinedon a real-time basis by the equilibrium between bids and offers. The Tokyo Stock Exchange
sets daily price limits, which limit the maximum range of fluctuation within a single tradingday. Daily price limits are set according to the previous day’s closing price or special quote.

Article 23(1) (m)Latest net asset value

JPR’s unit’s latest market price is publicly available at the Tokyo Stock Exchange or fromof the AIF or latest

financial information venders (including Reuters, which can be viewed atmarket price of theunit or share of thehttps://www.reuters.com/markets/companies/8955.T

AIF
Article 23(1) (n)Details of the

The units of JPR were listed on the Tokyo Stock Exchange on June 14, 2002.

historical

The most recent five fiscal periods’ performance of the units is as follows.

performance of theAIF, where available
Fiscal period

Total Assets

Total Net Assets(JPY million)(JPY million)

Total unitholders’equity per unit
(base value) (JPY)

45th Fiscal Period(January 1, 2024 to June

536,87130, 2024)

16

273,704

274,47944th Fiscal Period(July 1, 2023 to

510,802273,752

274,527510,069

273,974

274,749

507,655

273,603274,378

507,005

272,912273,684

December 31, 2023)
43rd Fiscal Period(January 1, 2023 to June30, 2023)
42nd Fiscal Period(July 1, 2022 to
December 31, 2022)
41st Fiscal Period(January 1, 2022 to June30, 2022)
Article 23(1) (o)Identity of the prime

No applicable prime broker.

broker, any material
arrangements of the
AIF with its prime
brokers, how conflictsof interest aremanaged with theprime broker and theprovision in thecontract with thedepositary on thepossibility of transfer
and reuse of AIF
assets, andinformation about any
transfer of liability tothe prime broker that
may exist
Article 23(1) (p)Description of how

The AIFM will disclose the matters described in Articles 23(4) and 23(5) periodically throughand when periodic

the AIF Internet website and fiscal report.

disclosures will bemade in relation toleverage, liquidity and17risk profile of theassets, pursuant to
Articles 23(4) and23(5)Article 23(2)The AIFM shall inform

Not applicable.

the investors before
they invest in the AIF
of any arrangement
made by thedepositary tocontractuallydischarge itself ofliability in accordancewith Article 21(13)The AIFM shall also

Not applicable.

inform investors of
any changes withrespect to depositary
liability without delay
Article 23(4)(a)Percentage of the

There are no assets that are subject to special arrangements arising from their illiquid

AIF's assets which arenature.

subject to special
arrangements arisingfrom their illiquid
nature. The
percentage shall becalculated as the net
value of those assets
subject to special
arrangements divided
by the net asset valueof the AIF concerned
Overview of any

There are no such special arrangements.

special arrangements,
including whether
they relate to side18

pockets, gates orother arrangements
Valuation

There are no such special arrangements.

methodology applied
to assets which are
subject to sucharrangements
How management

There are no such special arrangements.

and performance fees
apply to such assets
Article 23(4)(b)Any new

Any new arrangements or change in applicable arrangements will be disclosed at anarrangements forappropriate time.

managing the liquidityof the AIF
For each AIF that the

Any new arrangements or change in applicable arrangements will be disclosed at an

AIFM manages that is

appropriate time.

not an unleveraged
closed-end AIF, notify
to investors wheneverthey make changes to
its liquidity
management systems(which enable an
AIFM to monitor theliquidity risk of the AIF
and to ensure theliquidity profile of theinvestments of the AIF
complies with its
underlying
obligations) that arematerial inaccordance with
Article 106(1) ofRegulation (EU) No
231/2013 (ie. there isa substantial

19

likelihood that areasonable investor,
becoming aware ofsuch information,
would reconsider its
investment in the AIF,
including becausesuch information
could impact aninvestor’s ability to
exercise its rights inrelation to its
investment, orotherwise prejudice
the interests of one ormore investors in the
AIF).
Immediately notify

Any new arrangements or change in applicable arrangements will be disclosed at an

investors where they

appropriate time.

activate gates, side
pockets or similar
special arrangements
or where they decideto suspend
redemptions
Overview of changes

Any new arrangements or change in applicable arrangements will be disclosed at an

to liquidity

appropriate time.

arrangements, even if
not special
arrangements
Terms of redemption

JPR is a closed-end investment corporation, and unitholders are not entitled to request theand circumstances

redemption of their investment.

where management
discretion applies,
where relevant
Also any voting or

There are no voting or other restrictions on the rights attaching to units.

other restrictions
exercisable, the20

length of any lock-up
or any provision
concerning ‘first inline’ or ‘pro-rating’ on
gates and suspensions
shall be included
Article 23(4)(c)
The current risk

The AIFM stipulates basic provisions of risk management in their risk management rules.

profile of the AIF andthe risk management

Investment corporation bonds and long-term loans are used to finance rehabilitation

systems employed by

obligations, acquisition of real estate and repayment of loans. These financial instruments

the AIFM to manage

are exposed to liquidity risk. JPR manages such risk through such measures as procuring

those risks

funds from the capital market by increasing capital, executing a commitment line
agreement with the main lending financial institutions, and also having statements of cash
receipts and disbursements prepared by the financial division.
For floating rate borrowings exposed to the risk of interest rate fluctuations, JPR, in order toreduce the impact caused by rising interest rates, closely monitors the movement ofinterest rates, and intends to increase the ratio of fixed rate loans compared to floating rateloans.
Deposits are exposed to risks of failure of the financial institution holding the deposit andother credit risks, but such risks are managed through such measures as setting a minimum
credit rating for the financial institutions holding the deposits.

Measures to assess

No such measures have been implemented.

the sensitivity of the
AIF’s portfolio to themost relevant risks towhich the AIF is or
could be exposed
If risk limits set by theNo such situation has occurred.

AIFM have been or
are likely to be
exceeded and wherethese risk limits havebeen exceeded a
description of thecircumstances and the21remedial measures
taken
Article 23(5)(a)Any changes to the

Any new arrangements or change in applicable arrangements will be disclosed at an

maximum amount ofappropriate time.

leverage which the
AIFM may employ onbehalf of the AIF,
calculated inaccordance with thegross andcommitment
methods. This shall
include the originaland revised maximum
level of leveragecalculated inaccordance with
Articles 7 and 8 ofRegulation (EU) No
231/2013,, whereby
the level of leverage
shall be calculated as
the relevant exposure
divided by the net
asset value of the AIF.
Any right of the reuse

No such right or guarantee exists.

of collateral or any
guarantee granted
under the leveraging
agreement, including
the nature of therights granted for thereuse of collateral andthe nature of theguarantees granted22

Details of any change

Any new arrangements or change in applicable arrangements will be disclosed at anin service providers

appropriate time.

relating to the above.
Article 23(5)(b)Information on the

The aggregate amount of debt with interest is JPY 230,400 million as of June 30, 2024.

total amount ofleverage employed by
the AIF calculated inaccordance with thegross andcommitment methods

23