26th
Report on Operating andManagement Results
Twenty-Sixth Fiscal Period
Semi-Annual Report
July 1, 2014 – December 31, 2014

Japan Prime Realty Investment Corporation

Japan Prime Realty Investment Corporation (JPR) is a J-REIT having one of the largest asset
holdings in Japan with a combined portfolio that is focused on office properties in Tokyo* andcomplemented by urban retail properties.
Since its listing in 2002, JPR has steadily expanded its asset size while maintaining stable cash
distributions. Going forward, JPR will endeavor to further improve the quality of its portfolio
and manage its assets so that steady growth and enhancement of unitholder value is secured as it
moves ahead.
*"Office properties in Tokyo" represent office properties located in Central Tokyo (Chiyoda, Chuo, Minato, Shinjuku,
Shinagawa and Shibuya Wards) and Greater Tokyo (all other areas of Tokyo, Chiba, Kanagawa and Saitama
Prefectures) (the same applies throughout this report).

Features of JPR

1. Proven track record in achieving steady growth andstable management since listing

2. High-quality portfolio of assets centering on office properties
in Tokyo

3. Stable financial operations
4.

 trong support from five sponsor companies including
S
Tokyo Tatemono Co., Ltd.

Cash Distribution per Unit
Determined cash distribution (for the 26th fiscal period)¥6,351(Distribution starting on March 10, 2015)

Assets Held¥405.5 billion(End of 26th fiscal period)

Properties Owned

62 properties(End of 26th fiscal period)

Occupancy Rate at End of Period

97.0%(End of 26th fiscal period)
Oval Court Ohsaki Mark West

Contents
I. Account Highlights
1. Operating Performance Topics
2. Message from Asset Manager

3
3
4

II. Overview of JPR
1. Portfolio Growth
2. Investment Strategy
3. Operational Strategy
4. Financial Strategy
5. Initiatives on Governance
6. Initiatives on Environmental Friendliness7. Overview of Portfolio Properties
8. Structure and History of JPR
9. Overview of Asset Manager

8
8
10
12
13
14
15
16
30
31

III. Asset Management Report
1. Overview of Asset Management
2. Overview of the Investment Corporation
3. Status of JPR’s Assets Under Management
4. Capital Expenditures of Owned Real Estate
5. Expenses and Liabilities
6. Acquisitions and Sales during the 26th Fiscal Period

32
32
38
40
44
46
49

7. Overview of Accounting
8. Overview of Self-Managed Investment
		 Trust Beneficiary Certificates
9. Disclosure on Corporation Owning Foreign
		 Real Estate
10. Disclosure on Real Estate Owned by Corporation
		 Owning Foreign Real Estate
11. Other51

IV. Financial Statements(1) Balance Sheets(2) Statements of Income and Retained Earnings(3) Statements of Changes in Unitholders’ Equity(4) Statements of Cash Distributions(5) Statements of Cash Flows(6) Notes to Financial Statements(7) Detailed Schedules(8) Independent Auditor's Report(9) Other Notes (Information only)

54
54
56
57
58
59
60
69
73
74

V. Investor Information

75

52
53
53
53

1

Message to Our Unitholders

Japan Prime Realty
Investment Corporation

Hirohito Kaneko
Executive Officer

Sosuke Yasuda
Supervising Officer

Masato Denawa
Supervising Officer(From left to right) Masato Denawa, Hirohito Kaneko and Sosuke Yasuda

Dear Investors,
We at Japan Prime Realty Investment Corporation (JPR) would like to express our sincere
gratitude for the continued loyal patronage you have extended to us.
Having settled the 26th fiscal period (July 1, 2014 – December 31, 2014) at the end of December
31, 2014, we renew our heartfelt appreciation for your advocacy and encouragement.
Going forward, JPR will continue working with Tokyo Realty Investment Management, Inc.
(TRIM), to which we entrust asset management, to realize stable growth of our portfolio overthe medium to long term while taking into full account the governance of JPR as an investment
corporation.
We ask for your continued understanding and support of our operations.

2I. Account Highlights

Japan Prime Realty Investment Corporation

1. Operating Performance Topics(All amounts in millions of yen unless otherwise stated)

22nd Fiscal Period 23rd Fiscal Period 24th Fiscal Period 25th Fiscal Period 26th Fiscal Period
ended
ended
ended
ended
ended
December 2012
June 2013
December 2013
June 2014
December 2014
Operating revenues

12,963

13,27813,591

13,734

13,902

Ordinary income

5,026

4,975

4,899

5,073

5,239

Net income

5,025

4,974

4,954

5,072

5,238

Total cash distributions

5,026

4,975

4,954

5,073

5,239

Total assets

401,984

409,715

413,974

414,104

414,091

Total unitholders' equity

197,168

197,116

197,095

197,213

197,378

49.0

48.1

47.6

47.6

47.7

Unitholders' equity per unit (yen)238,992

238,929

238,903

239,046

239,246

Cash distribution per unit (yen)

6,093

6,031

6,006

6,150

6,351

Equity ratio (%)

Operating Revenues andNet Income

Total Assets andTotal Unitholders' Equity

15,000500,000

12,000400,000

Cash Distribution per Unit

8,000

6,000

300,000

9,000

4,000
6,000

200,000

3,000

100,000

2,000

0

22nd
FiscalPeriod23rd
FiscalPeriod24th
FiscalPeriod25th
FiscalPeriod26th
FiscalPeriod0

22nd
FiscalPeriod23rd
FiscalPeriod24th
FiscalPeriod25th
FiscalPeriod26th
FiscalPeriodOperating Revenues (million yen)

Total Assets (million yen)

Net Income (million yen)

Total Unitholders' Equity (million yen)0

22nd
FiscalPeriod23rd
FiscalPeriod24th
FiscalPeriod25th
FiscalPeriod26th
FiscalPeriodCash Distribution (yen)3

I. Account Highlights

2. Message from Asset Manager

Satoshi Okubo
President and Chief Executive Officer (CEO)Tokyo Realty Investment Management, Inc.
(the Asset Manager of JPR)
Career Highlights
2010: 	Took office as President and CEO of Tokyo Realty
Investment Management, Inc.
2005: 	Appointed Director and Head of Kansai Branch
Office, Tokyo Tatemono
1998: 	Appointed General Manager of Residential
Management Department, Tokyo Tatemono
1977: 	Joined Tokyo Tatemono Co., Ltd.

Revenues and profits have increased period-on-period for two consecutive fiscal
periods, and distribution per unit for the 26th fiscal period has significantly
surpassed the previous period’s results.
With the office property leasing market expected to show a full-on recovery, we will
aim to achieve further growth of JPR.

I would like to extend my heartfelt gratitude to you, our unitholders, for the support you haveextended to Japan Prime Realty Investment Corporation (JPR).
In the 26th fiscal period that ended December 2014, an increase in rent revenues from existing
properties and a reduction in financing costs, among other factors, enabled the distribution perunit of JPR to reach 6,351 yen, surpassing the results achieved for the previous fiscal period.
Let me give you an overview of the management results for the 25th fiscal period and the future
outlook of JPR.

4

Japan Prime Realty Investment Corporation

you tell us about cash distributions for the 26th fiscal period ended December
Q1: Could
2014?
per unit has reached 6,351 yen, up 3.3% compared with the previous fiscal
A1: Distribution
period.
Distribution per unit has increased primarily due to a rise in rent revenue from existing properties. With the officeproperty leasing market heading for recovery, our endeavors to raise new contract unit rents and initiatives oncontract renewals with upward revisions of rents, etc. have borne fruit.

Q2: What are the reasons behind the increase in rent revenue?
A2: Performance of the portfolio has improved both in terms of occupancy and rents.
The office property leasing market has seen the supply and demand balance increasingly improve primarily in theTokyo area.
Leasing (invitation of tenants) for JPR’s properties has also made good progress. This has been seen not only at officeproperties in Tokyo but also office properties in regional cities as well as strongly at urban retail properties, raising the
average occupancy rate of the entire portfolio to 97.2%.
Moreover, the average unit rent of the entire portfolio has increased for two consecutive fiscal periods thanks to a risein new contract rents and an increase in the number of contract renewals with upward revision of rents. Indicatingthat our endeavors to improve tenant satisfaction have been effective.
The performance of the portfolio has improved both in terms of occupancy and rents, resulting in an increase in rent
revenue.
Furthermore, as revenue continues to stay on an upward trend after entering the 27th fiscal period ending June 2015,
we expect rent revenue to increase even further.
Changes in Rent Revenue and Average Occupancy Rate
(Millions of yen)
12,70096.9
12,600

97.2

97.0

95.6
12,48912,347

97.5(Forecast)

12,50012,400(%)

Average occupancy rate (%, right axis)

Rent revenue (million yen, left axis)

12,361

12,524

99
97
95
93

12,39391

12,30089
0023rd Period
ended Jun. 2013

24th Period
ended Dec. 2013

25th Period
ended Jun. 2014

26th Period
ended Dec. 2014

27th Period
ending Jun. 2015 (Forecast)(Note 1) Rent revenue represents revenue from existing properties as of the 23rd fiscal period ended June 2013.
(Note 2) The rent revenue and average occupancy rate for the 27th fiscal period have been calculated based on confirmed contracts.

5

I. Account Highlights

do you perceive to be the strengths of your operations in maintaining
Q3: What
competitiveness?

A3: We have established a team of technical experts that is rare in the REIT industry.
In order to strategically manage a large-scale portfolio of properties, we need to conduct not only repairs andmaintenance but also value enhancement work to essentially improve the functions of the buildings.
Tokyo Realty Investment Management, Inc. (TRIM), the asset management company of JPR, has a well-established“asset engineering group,” an internal organization comprised of experienced technical experts, which strategicallyconduct the following operations.
(1) Value enhancement work (to improve functions and invite tenants)(2) Promotion of energy efficiency and other environmental friendliness initiatives(3) Responses to business continuity plans (BCPs) (to cope with disasters, accidents and other contingencies)(4) Cost control for repair and maintenance work and other operations

Q4: Can you explain your policy regarding property acquisitions going forward?
will continue to firmly maintain the stance of vigorously selective investments amid
A4: Wethe for-sale real estate market becoming overheated.
The for-sale real estate market is becoming increasingly overheated due tomonetary easing and other factors, driving up property prices. We forecast
that such an environment will continue for some time ahead, and intend to
firmly maintain the stance of vigorously selective investments with a focus on
negotiated transactions.
JPR has diverse acquisition channels, including the sponsor support,
proprietary information channels and utilization of preferential negotiationrights. In the 26th fiscal period, JPR made the additional acquisition of
Shibadaimon Center Building without being involved in excessive competition
as a result of our utilizing the preferential negotiation rights for the property.

Q5: Can you tell us about the refinancing conducted in the 26th fiscal period?
A5: We worked on further stabilizing the financial base.
The fund procurement environment has remained favorable, with interest rates staying at historically low levels. Givensuch an environment, we endeavored to further reduce financing costs as well as lengthen the maturity of debts andincrease the ratio of fixed interest rate debts.
Comparison Before and After Refinancing in the 26th Fiscal Period
Amount of borrowings andbond issuance

Before refinancing
After refinancing
613.0 billion yen
13.0 billion yen

Average maturity

Average interest rate

7.2 years

1.80%+ 1.6 years- 0.93%8.7 years

0.87%

Japan Prime Realty Investment Corporation

Office inTokyo
generally hold JPR’s investment units?
Q6: How long do unitholders
43.5%

A6:

Retailin TokyoOver 70%14.4%of the unitholders hold investment units for 5 years or longer.

We believe a relatively large number of unitholders holdinvestment units over a long term, with the ratio of thoseholding 5 years or longer being over 70%.

Ratio of Holding Periods by JPR’s Unitholders(End of the 26th Period)
Less than a year7%
1 year to lessthan 3 years
11%
3 years to lessthan 5 years
8%

The number of individual unitholders who takeadvantage of NISA, Japan’s new tax exemption programfor small investments, has increased since last year.
Moreover, the Government Pension Investment Fund(GPIF), one of the largest pension funds in the world,
has added J-REITs to its investment portfolio. As thesesuggest, we think the base of investors who take thestance of long-term holding will further increase going
forward.

5 years
or more74%

Q7: What is your management target going forward?
aim to achieve steady growth of distribution per unit, setting 6,500 yen as the next
A7: Wetarget.
JPR has achieved “distribution per unit of 6,000 yen,” the normal operation target, for six consecutive fiscal periods.
With the office property leasing market on track to recovery, rent revenue from the existing portfolio has increased
quickly. As such, we understand that JPR has entered a new phase.
We have set a benchmark of “distribution per unit of 6,500 yen” as the next target, and will continue working toachieve steady growth of cash distributions.
Changes in Distribution per Unit
(Yen)
(Forecast)

6,500

6,351
6,250

6,093

6,360

6,150
6,031

6,006

23rd Period
ended Jun. 2013

24th Period
ended Dec. 2013

6,000

5,750
0
22nd Period
ended Dec. 2012

25th Period
ended Jun. 2014

26th Period
27th Period
ended Dec. 2014 ending Jun. 2015 (Forecast)7

II. Overview of JPR

1. Portfolio Growth
Occupancy Rate at End of Period (%)
100

96.3

94.1

95

93.4

93.5

93.2

92.7

95.1

95.4

97.2

99.0

98.6

98.0

98.4

90
85

Asset Size, etc. and Results of Distributions per Unit (billions of yen)
400
Office properties in Tokyo

Office properties in Other Cities

Retail properties

350

300

245.3

250

197.6

200

202.6

209.2

179.6

125.7
100

50

0

40.7
12.5
14.9
13.2

92.1

94.5

40.1

41.5

38.8

39.7

13.2

13.2

52.7
39.7
33.2

139.6

99.2
77.4

47.9
38.2

38.2

108.2

114.7

100.1

43.1

43.1

93.9

93.9

100.1

91.2

57.5

43.9

222.4

100.1

163.6
150

251.9

47.9

40.4

48.3

45.2

45.2

50.0

57.2

63.8

45.2

77.0

Nov. 16, 2001 End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec.
2002
2002
2003
2003
2004
2004
2005
2005
2006
2006
2007
2007
Start of
1st Period 2nd Period 3rd Period 4th Period 5th Period 6th Period 7th Period 8th Period 9th Period 10th Period 11th Period 12th Period
management

Number of
13
properties
Total number
133
of tenants
Leasable floor
94,935space (m2)Distribution–
per unit (yen)

25

27

30

32

38

42

42

42

44

46

48

49

281

311

324

357

437

496

459

441

462

479

491

517

162,739

168,987

201,808

218,734

256,329

273,330

281,408308,205

315,156

337,382

361,574

373,609

2,545

6,912

6,873

5,738

6,081

6,671

6,370

6,411

6,509

6,873

6,996

6,671

Property Diversification
Retail in Tokyo
15.7%

Retail 23.5%

Retail in Other Cities
7.8%
Office in Other Cities
9.3%

Target investment ratio by area
Tokyo:
80 - 90%
Other Cities: 20 - 10%

Other Cities Tokyo
17.1% 82.9%

Target investment ratio by asset class
Office in Tokyo
67.3%

Office 76.5%

8

Portfolio Management Standards

Office: 70 - 90%
Retail: 30 - 10%(Note) 	The figures in the graph to the left show the investment ratios, which represent the ratiosof the total acquisition price of properties in respective categories to the total acquisition
price of the entire portfolio, rounded to the first decimal place.

Japan Prime Realty Investment Corporation

97.5

96.4

96.8

96.4

95.5

93.5

94.7

95.6

94.1

94.9

96.9

96.5

97.8

97.0

404.7

404.7

405.5

265.8

271.9

271.9

272.7

391.9

398.6

259.2

259.2

380.9
341.5

341.5

344.9

331.2
299.4
275.1

310.6

280.6

184.1
135.7

141.6

43.1

39.4

96.1

99.5

172.9

209.5

219.8

219.8

223.2

31.1

31.1

26.5

26.5

26.5

26.5

26.5

37.5

37.5

37.5

37.5

37.5

95.3

95.3

95.2

95.2

95.2

95.2

95.2

95.2

95.2

95.2

95.2

95.2

End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec. End of Jun. End of Dec.
2008
2008
2009
2009
2010
2010
2011
2011
2012
2012
2013
2013
2014
2014
13th Period 14th Period 15th Period 16th Period 17th Period 18th Period 19th Period 20th Period 21st Period 22nd Period 23rd Period 24th Period 25th Period 26th Period

50

52

51

53

55

56

56

57

58

59

60

62

62

62

537

499

476

476

460

479

493

501

502

534

564

610

628

632

383,491

383,215

393,532

400,751

410,326

420,544421,371423,311434,340

450,943

460,452

467,207467,175

468,232

7,122

7,092

3,731

6,933

6,770

5,680

5,611

5,876

6,430

6,093

6,031

6,006

6,150

6,351

(Note 1) The asset size represents the aggregate acquisition price of the respective properties in JPR’s portfolio as of the relevant date, rounded off to the nearest 100 million yen.
(Note 2)	The number of tenants at end of period is counted as follows: when a single tenant leases 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.
(Note 3) 	For Shinjuku Square Tower, each compartmentalized owner leases respective exclusive space to Tokyo Tatemono Co., Ltd. in a lump sum, and Tokyo Tatemono subleases the space tosublessees. Accordingly, the leasable floor space of the building is calculated by multiplying the total contracted space of offices, shops and warehouses that are leased by Tokyo Tatemono andcan be sublet, by JPR’s rent distribution rate (39.70457% through June 30, 2008 and 40.31465% since the 14th fiscal period in accordance with the additional acquisition in September 2008),
while the leased floor space for calculating the occupancy rate is calculated by multiplying the floor space sublet to sublessees by the rent distribution rate. Both figures are rounded to thesecond decimal place.
In addition, the number of the sublessees is deemed to be the number of tenants for the building.
(Note 4) 	The tenants of Shinjuku Center Bldg., the residential section of Science Plaza – Yonbancho Plaza, Rise Arena Bldg. and Kawasaki Dice Bldg. have sublet space to sublessees and lease agreements
have been executed where the rent paid by the tenants fluctuates in accordance with the lese conditions of the sublessee. Accordingly, the total leasable floor space and the occupancy rate ofthese buildings indicate those for the sublessees of the tenants, and the number of the sublessees is deemed as the number of their tenants.
(Note 5) 	When the contracted floor space and the floor space for calculating rents differ, the latter was treated as the leased floor space through the 10th fiscal period. Since the 11th fiscal period,
however, the contracted floor space has been used as the leased floor space.
(Note 6) The occupancy rate at end of period has been rounded to the first decimal place.
(Note 7) The total leasable floor space has been rounded off to the nearest integer.

9II. Overview of JPR

2. Investment Strategy
JPR is resolved to continuously work on investment focused on office properties in Tokyo in order toenhance its growth potential over the long term, while conducting vigorously selective investment in retailproperties as well as office properties in regional cities that are expected to generate relatively high yields.

Focusedinvestment in
office properties
in Tokyo

Vigorously
selective
investment inretail properties
as well as officeproperties inregional cities

Improve the quality of the portfolio by making investment focused on office properties inTokyo that are expected to contribute to long-term growth
Compared with other regional cities, Tokyo allows expectations for more stable occupancy and higher
rent levels, and is believed to offer larger rooms for an upward turn and an increase of rents when theleasing market shows a recovery trend. Looking ahead, JPR will continue to make investment focusedon office properties in Tokyo, with an aim to further improve the quality of its portfolio and enhance
its growth potential in the recovery cycle of the market.

For retail properties as well as office properties in regional cities, which allow JPR to expect
higher yields, work to invest in strictly selected blue-chip properties that can keep stablerevenues at a certain level
Retail properties as well as office properties in regional cities tend to have relatively higher yields
than office properties in Tokyo, although there are some properties that are somewhat less stable interms of earnings subject to the market situation. While securing growth potential by making focusedinvestment in office properties in Tokyo, JPR will make vigorously selective investment in urban retailproperties with long-term, fixed-rent contracts and in large office properties in regional cities having
a high competitive advantage in the areas, in order to complement the stability of earnings from theentire portfolio.

Changes in Investment Ratios by Asset Class and Area
Over the last five years, JPR made investments in 11 office properties in Tokyo totaling 88.6 billion yen (acquisition
price), enhancing the quality of its portfolio.
End of 1st Fiscal Period (June 30, 2002)

Office in
Other Cities
42.1%
Retailin Tokyo
14.4%

End of 26th Fiscal Period (December 31, 2014)
Retail in
Other Cities
7.8%
Office in
Other Cities
9.3%

Office in
Tokyo
43.5%

Retailin Tokyo
15.7%

Increase in investment ratio
of office properties in Tokyothrough focused investment:

Officein Tokyo

67.3%+23.8%(Note) 	The figures in the graphs show the investment ratios, which represent the ratios of the total acquisition price of properties in respective categories to the total acquisition price of the entire
portfolio, rounded to the first decimal place.

Portfolio Management Standards of JPR

10

Target investment ratio by area

Target investment ratio by asset classTokyo:
80 - 90%
Other Cities: 20 - 10%

Office: 70 - 90%
Retail: 30 - 10%

Japan Prime Realty Investment Corporation

In the for-sale real estate market, transactions of blue-chip properties have been rather limited. Given
the situation, JPR will work to invest in blue-chip properties by fully implementing various acquisition
strategies based on its high sourcing abilities while utilizing sponsor support.
Utilization of sponsor
support from the Fuyo
Group companies
including Tokyo
Tatemono

Supply of blue-chip properties among office properties in Tokyo is still inadequate in thefor-sale real estate market, and their acquisition opportunities are rather limited.

Investment strategies
based on diversified
property acquisition
methods and highsourcing abilities

To acquire properties from third parties other than the sponsors, JPR exercises its highsourcing abilities and takes advantage of various information channels to make access to
wide-ranging property information.

JPR will take advantage of support from Tokyo Tatemono Co., Ltd. and other sponsors tosecure opportunities to invest in blue-chip properties at reasonable price levels without being
exposed to excessive competition in the market.

For properties with co-ownership or compartmentalized ownership, JPR implements
various methods to acquire properties, including acquisition of additional equity by utilizing
preferential negotiation rights.

Cases in which JPR Acquired Properties by Utilizing Sponsor Support
JPR has displayed its strength of having sponsors comprising real estate developers, a general contractor and financial
institutions in acquiring blue-chip properties.
<Sponsors>

The Otemachi Tower(Land with Leasehold Interest)

Yakuin Business GardenTokyo Tatemono

Taisei Corporation

Yasuda Real Estate

Sompo Japan Nipponkoa Insurance Inc.

Meiji Yasuda Life Insurance

The Otemachi Tower (Land with
Leasehold Interest) was acquired froman SPC in which Tokyo Tatemono andTaisei Corporation had equity interests.

Yakuin Business Garden was acquired
from an SPC in which Tokyo Tatemono
has equity interests.

Japan Prime Realty
Investment Corporation(securities code: 8955)

Property Acquisition Results by Channel
At JPR, the ratio of properties acquired from its
sponsors, etc.(Notes) and that of properties acquired fromthird parties (total of properties acquired based on theinformation provided by the sponsors and those acquired
other than from the sponsors, etc.) are almost equal,
standing at 50.3% for the former and 49.7% for the latter(on an acquisition price basis).
JPR will work to increase property acquisition
opportunities and conduct vigorously selective investment
in blue-chip properties by building sourcing abilities on
its own instead of depending solely on sponsor support.
(Note)	Sponsors, etc. represent the five sponsor companies of JPR, their affiliate companies andspecial purpose companies (SPCs) in which the sponsors have made equity investment.

Transactions with third parties

49.7%

Properties acquired
other than fromsponsors, etc.

30.0%
19.7%

Properties
acquired fromsponsors, etc.

50.3%

Properties acquired
based on information
provided by sponsors

11II. Overview of JPR

3. Operational Strategy
JPR endeavors to implement its leasing strategies focused on maintaining and increasing the occupancyrate, with an aim to keep revenues from the portfolio stable in a continuous manner.

Organizational
reinforcement ofleasing activities

Tokyo Realty Investment Management, Inc. (TRIM) has established a group that supervises leasing,which implements leasing strategies that are based on property characteristics. Endeavors arebeing exerted to enhance the leasing framework by not only reinforcing coordination with property
management companies but also receiving support on leasing and obtaining market information frommajor brokerage firms, so that JPR can provide lease terms and conditions that take into account themarket conditions, accelerate decision-making and take other measures to strengthen leasing.

Maintenanceand improvementof tenantsatisfaction

TRIM periodically conducts questionnaire surveys to tenants, and works to improve tenantsatisfaction by grasping comments, requests and other feedback from tenants and promptly
responding. By doing so, TRIM aims to prevent move-outs of existing tenants and encourage themto expand office spaces in the same buildings or the upward revision of rents, so as to secure stableearnings of JPR over the medium to long term.

Strategic valueenhancement
works

TRIM has established a group dedicated to construction management, environmental friendlinessand other matters, reinforcing its endeavors on the promotion of higher energy efficiency, responses
to business continuity plans and environmental awareness and other initiatives that are strongly
requested by society. In addition, while working to enhance NOI and tenant satisfaction, TRIM
strategically conducts value enhancement work that should strengthen competitive advantages ofproperties as well as help attract tenants.

Changes in Occupancy Rate
Endeavors to reinforce leasing activities and enhancetenant satisfaction successfully generated results, withthe period-average occupancy continuing to rise sincethe 23rd fiscal period and standing at a high level of
97.2% in the 26th fiscal period.

（%）
98.0

Period-Average Occupancy Rate

96.9%

96.0
94.0

93.6%

94.0%

95.0%

97.0% 97.2%

95.6%
94.8%

94.4%

92.0
18th
19th
20th
21st
22nd
23rd
24th
25th
26th
Period Period Period Period Period Period Period Period Period

Examples of Renewal Works(Dec. 2010) (Jun. 2011) (Dec. 2011) (Jun. 2012) (Dec. 2012) (Jun. 2013) (Dec. 2013) (Jun. 2014) (Dec. 2014)

An example of work conducted in the 26th fiscal period includes replacement of the centrally-controlled air
conditioning system with the individually-controlled air conditioning system at Shin-Kojimachi Bldg., which
improved the ability for individually control air conditioning and helped enhance tenant satisfaction.
Replacement of Air Conditioning System at Shin-Kojimachi Bldg. (From Centrally-Controlled to Individually-Controlled
Air Conditioning System)
Removed the cooling tower (left photo) for the centrally-controlled air conditioning, and installed the outdoor unit (right photo)for the individually-controlled air conditioning on the same place
Before12

AfterJapan Prime Realty Investment Corporation

4. Financial Strategy
JPR is engaged in conducting financial operations in a stable and sound manner, such as working tolengthen the average maturity of debts while maintaining the ratio of long-term, fixed interest rate debts aswell as conservatively controlling the ratio of interest-bearing debts (LTV).
LTV

JPR is engaged in conservative financial operations, setting the ceiling of LTV at 55% as a ruleand working to control the ratio at 50% or lower in practice.

46.4%
Ratio of long-term, fixedinterest rate debts

98.2%
Average interest rate

JPR keeps a high ratio of long-term, fixed interest rate debts under the basic policy of procuring
funds through long-term, fixed interest rate debts, with an eye on reducing risks of rising interest
rates.
JPR endeavors to reduce financing costs, taking advantage of the favorable fund procurement
environment to the utmost.

1.16%
Average maturity

JPR works to lengthen the average maturity of debts under the basic policy of procuring fundswith longer borrowing periods, while remaining attentive to the diversification of repayment andredemption dates.

3.9 years

Status of Corporate Credit Ratings Assigned to JPR (End of 26th Fiscal Period)
JPR maintains high, AA-rank credit ratings, with recognition given to its stable and sound financial operations.
R&I

S&P

(Rating and Investment Information, Inc.)(Standard & Poor's Ratings Japan K.K.)

A

AA-

A-1

(Long-term)(Short-term)

Changes in Average Interest Rate and Average Maturity(%)
1.6

JPR endeavors to reduce
financing costs and keep
financial stability by lowering
the average interest rateand lengthening the average
maturity.

Average interest rate (left axis)
1.48

1.46

1.41

1.4

4.0

1.2

0

3.3
years

3.4
years

3.5
years

3.8
years

End of22nd Period(Dec. 2012)

End of23rd Period(Jun. 2013)

End of24th Period(Dec. 2013)

End of25th Period(Jun. 2014)

2.9
years
End of21st Period(Jun. 2012)

5.0

1.35
1.23

1.0

(years)Average maturity (right axis)

1.16

3.0

3.9
years

2.0

End of26th Period(Dec. 2014)

0

Diversification of Repayment Dates of Interest-Bearing Debts
JPR works to mitigate refinance risks by establishing a commitment line totaling 28 billion yen while having
repayment dates of debts more diversified.
(100 million yen)

Long-term loans payable

250

Investment corporation bonds

200
50

150
100
50
0

130
135
61

131

70
51

50

195
120

83

40

20
81

91

80

60

20

100
48

20

25

27th
28th
29th
30th
31st
32nd
33rd
34th
35th
36th
37th
38th
39th
40th
41st
periodperiodperiodperiodperiodperiodperiodperiodperiodperiodperiodperiodperiodperiodperiodEnding Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending
Jun. 2015 Dec. 2015 Jun. 2016 Dec. 2016 Jun. 2017 Dec. 2017 Jun. 2018 Dec. 2018 Jun. 2019 Dec. 2019 Jun. 2020 Dec. 2020 Jun. 2021 Dec. 2021 Jun. 2022

50
43rd
periodEndingJun. 2023

50

30
20

45th
46th
periodperiodEnding Ending
Jun. 2024 Dec. 2024

85
50th
periodEndingDec. 2026

13

II. Overview of JPR

5. Initiatives on GovernanceIn the belief that it is essential to secure sound and efficient operations of JPR in order to realize its continuous growth,
consistent efforts have been made to reinforce and sustain corporate governance of JPR and TRIM, the Asset Manager.

Highly Independent Board Composition❚❚   At JPR, the executive officer as well as the supervising
officers have no concurrent assignment as officer of
TRIM so as to firmly secure the independence of JPR, theinvestment corporation.

Executive Officer:❚❚   The JPR officers comprise attorneys and a certified public
accountant with various experiences and high expertise, whohave a thorough knowledge of the REIT industry as well.

Supervising Officer: Masato Denawa (attorney)

Members of the Board of JPR

Hirohito Kaneko (attorney)

Supervising Officer: Sosuke Yasuda(certified public accountant)Diversified Shareholder Composition and Reinforced Independence❚❚   With the sponsors comprising five companies, thediversified shareholder composition also contributes
to securing the independence of the Asset Manager.
❚❚   TRIM President and CEO has assumed office after
having his employment transferred to TRIM, insteadof being seconded from the sponsor company hebelonged to.
❚❚   The Compliance Office general manager in charge ofinternal control is a career employee, not seconded
from the sponsor company he belonged to.

Shareholder Composition of TRIM
real estateTokyo Tatemono

real estate

Shareholding ratio:

40%

Taisei Corporation

Yasuda Real Estate

Shareholding ratio:

20%

20%

Shareholding ratio:

financefinance

Meiji Yasuda Life Insurance

Shareholding ratio:

construction

10%(Asset Manager)
Tokyo Realty Investment
Management, Inc.

Sompo Japan Nipponkoa Insurance Inc.

10%

Shareholding ratio:

Decision Making Based on Stringent Processes❚❚   Upon making decisions on property acquisitions,asset management and other issues, TRIM conducts
stringent screening and takes other procedures fromvarious perspectives through designated committees
and other institutions.
❚❚   In particular, material transaction matters conductedwith the sponsors, etc. are screened and verified by
the Compliance Committee as to their adequacy andrationality. The Committee employs unanimous votefor approvals in principle.
❚❚   An outside attorney has been appointed as a special
member of the Compliance Committee.
Members of the Compliance Committee of TRIM
President and CEO
Corporate Planning / Administration
Division general manager

Investment Management Division
general manager

Financial Division
general manager

Compliance Officegeneral manager
Special member(outside attorney)

14

Stringent Decision-Making Process(for property acquisitions)
Proposal, planning

Investment Management Department

Review, screening

Compliance Subcommittee

Decision on acquisition policy

Investment Subcommittee

Due diligence

Due Diligence Subcommittee

Prior review / approval oftransaction with related parties

Final decision on acquisition
Decision making on acquisition
over certain amountConclude agreement

Compliance Committee
JPR’s Board of Directors
Investment Subcommittee

TRIM’s Board of Directors

Acquisition

In addition to the processes indicated in the above chart, there may be cases where approvalby the Board of Directors and consent by JPR are required as designated in the Act on
Investment Trusts and Investment Corporations.

Japan Prime Realty Investment Corporation

6. Initiatives on Environmental Friendliness
From early on, JPR has implemented various initiatives on environmental friendliness.
JPR has proactively worked on effective reduction of energy costs, enhancement of greening inconsideration of the urban environment and other measures under the basic concept of “environmentallyfriendly buildings.” Such endeavors have also been recognized by external organizations.

Acquisition of DBJ Green Building Certification❚❚   JPR has obtained DBJ Green Building Certification, a system by Development Bank of Japan Inc. (DBJ) to certify
real estate properties evincing high environmental and social awareness, for multiple properties it owns.

Properties withexceptionally highenvironmental &social awareness

Properties
with highenvironmental &social awareness

Olinas Tower Yakuin Business
GardenJPR Crest
BYGS Shinjuku
Takebashi Bldg.
Bldg.

DBJ Green Building Certification

Properties
with excellent
environmental &social awareness

JPR Ueno
East Bldg.

JPR Sendagaya Shinagawa
Bldg.
Canal Building

Properties
with sufficientenvironmental &social awareness

JPR Nihonbashi
Horidome Bldg.

Rise Arena
Bldg.

Omiya Prime
East

Yume-ooka
Office Tower

Kanematsu Oval Court Ohsaki
Bldg.
Mark West

DBJ awards five levels of certification to office buildings in accordance with the degree ofenvironmental and social awareness they demonstrate.

Continuous Participation in GRESB Survey❚❚   JPR has participated in the GRESB Survey, which analyzes and evaluatesenvironmental considerations and sustainability, since 2011. In the survey
conducted in 2014, JPR was designated as “Green Star,” the highest
ranking of the four evaluation categories.
❚❚   JPR believes that its endeavors have been recognized as a result of
having diligently worked to reduce energy consumption by establishinga consistent system among all business partners involved in building
operations, from the Asset Manager to property managers and building
maintenance companies, under a clear environmental policy as well as asking
for cooperation with tenants.

GRESB, which stands for Global Real
Estate Sustainability Benchmark, isa benchmark system for analyzing
and evaluating sustainability interms of environmental friendlinessand social nature. It is based on
surveys conducted by a private
sector group established primarily
by major pension funds in Europe.

Taking Advantage of Environmental Friendliness Know-How of Sponsors❚❚   JPR and TRIM have consigned operations related to environmental laws and regulations to Tokyo Tatemono Co.,
Ltd., one of the sponsors, and established a system early on to receive know-how and advice from Tokyo Tatemono.
❚❚   TRIM has reinforced its initiatives on environmental friendliness by allocating dedicated staff to the section in chargeof construction planning for the portfolio properties, bolstered by the technological know-how of Taisei Corporation,
one of the sponsors.
15II. Overview of JPR

7. Overview of Portfolio Properties
List of Properties (62 Properties for the Entire Portfolio)
Central Tokyo (30 Properties)
Property
Number

Property Name

Location

Acquisition Date

Percentage of
Leasable
Portfolio Acquisition
Floor Space (m²)
Price (%)

Kanematsu Bldg.

Chuo-ku, Tokyo

Dec. 27, 2001

¥16,276

4.0

8,011.75

3.9

A-2

Kanematsu Bldg. Annex

Chuo-ku, Tokyo

Dec. 27, 2001

2,874

0.7

2,291.13

5.8

A-3

JPR Ningyo-cho Bldg.

Chuo-ku, Tokyo

Nov. 16, 2001

2,100

0.5

2,804.56

3.7

Nov. 16, 2001

1,670

0.4

Nov. 21, 2002

550

0.1

Nov. 12, 2004

200

0.0

3,317.48

4.4

A-4

Shin-Kojimachi Bldg.

Chiyoda-ku, Tokyo

2,420

0.6

A-5

JPR Crest Takebashi Bldg.

Chiyoda-ku, Tokyo

Jun. 21, 2002

4,000

1.0

3,265.34

7.8

A-6

MS Shibaura Bldg.

Minato-ku, Tokyo

Mar. 28, 2003

11,2002.8 14,468.38

6.8

A-7

Gotanda First Bldg.

Shinagawa-ku, Tokyo

Jul. 23, 2003

2,920

0.7

4,243.58

7.3

Oct. 15, 2003

1,800

0.4

A-8

Fukuoka Bldg.

Chuo-ku, Tokyo

Apr. 15, 2005

1,120

0.3

1,937.40

5.2

2,920

0.7

Total
A-9

JPR Ichigaya Bldg.

Chiyoda-ku, Tokyo

May 28, 2004

5,100

1.3

4,224.32

4.9

A-10

Oval Court Ohsaki Mark West

Shinagawa-ku, Tokyo

Jun. 1, 2004

3,500

0.9

4,088.44

3.5

Jul. 2, 2004

10,0002.5 10,982.03

A-11

Shinjuku Square Tower

Shinjuku-ku, Tokyo

Sep. 26, 2008

180

Office0.0

168.75

Total

10,1802.5 11,150.78

Nov. 9, 2004

2,900

0.7

Apr. 12, 2005

8,921

2.2

Jul. 13, 2010

3,300

0.8

Total

A-12

BYGS Shinjuku Bldg.

Shinjuku-ku, Tokyo

15,121

3.7

A-13

Across Shinkawa Bldg. Annex

Chuo-ku, Tokyo

Nov. 26, 2004

710

A-14

Shinjuku Center Bldg.

Shinjuku-ku, Tokyo

Mar. 27, 2008

A-15

Minami Azabu Bldg.

Minato-ku, Tokyo

A-16

Shinagawa Canal Bldg.

Minato-ku, Tokyo

A-17

Rokubancho Bldg.

A-18

JPR Harajuku Bldg.

A-19

1.3

15,216.93

3.1

0.2

1,253.39

4.7

21,0005.2

8,863.98

1.3

Jul. 14, 2008

3,760

0.9

3,405.73

6.0

Dec. 19, 2008

1,870

0.5

1,700.57

5.3

Chiyoda-ku, Tokyo

Dec. 2, 2009

2,800

0.7

2,488.36

7.7

Shibuya-ku, Tokyo

Dec. 25, 2009

8,400

2.1

4,760.09

6.8

Tokyo Tatemono Kyobashi Bldg.

Chuo-ku, Tokyo

Feb. 12, 2010

5,250

1.3

3,551.01

6.7

A-20

JPR Nihonbashi-horidome Bldg.

Chuo-ku, Tokyo

Mar. 31, 2010

5,100

1.3

5,299.89

5.0

A-21

JPR Sendagaya Bldg.

Shibuya-ku, Tokyo

May 31, 2010

15,0503.7

6,177.74

2.6

A-22

Ginza Sanwa Bldg.

Chuo-ku, Tokyo

Aug. 29, 2011

3,400

0.8

1,899.27

4.5

A-23

The Otemachi Tower (Land with
Leasehold Interest)

Chiyoda-ku, Tokyo

Mar. 13, 2012

36,0008.9 11,034.78

—

A-24

Science Plaza – Yonbancho Plaza

Chiyoda-ku, Tokyo

Dec. 6, 2013

2,660

0.7

3,325.27

3.1

Dec. 6, 2013

3,420

0.8

800

0.2

5,401.46

5.6

4,220

1.0

A-25

Shibadaimon Center Building

Minato-ku, Tokyo

Jul. 30, 2013

A-1

JPR Shibuya Tower Records Bldg.

Shibuya-ku, Tokyo

Jun. 30, 2003

12,0003.0

8,076.85

5.8

A-2

JPR Daikanyama

Shibuya-ku, Tokyo

Oct. 5, 2004

2,160

0.5

651.2912.5

A-3

JPR Jingumae 432

Shibuya-ku, Tokyo

1,027.33

5.4

2,347.81

1.6

1,101.92

3.0

52.6 147,386.83

—

Total

A-4

Shinjuku Sanchome East Bldg.

Shinjuku-ku, Tokyo

Mar. 24, 2006

4,275

1.1

Mar. 14, 2007

540

0.1

Apr. 24, 2008

2,200

0.5

2,740

0.7

3,400

0.8

Total
A-5

Yurakucho Ekimae Bldg. (Yurakucho
Itocia)Subtotal

Chiyoda-ku, Tokyo

Aug. 27, 2008

¥213,406(Note 1) The table above shows properties owned by JPR as of December 31, 2014.
(Note 2) The leasable floor space indicates only the portions owned by JPR. For co-owned properties, the figure indicates the portions corresponding to the equity interest held by JPR.

16

PML (%)

A-1

Total

RetailAcquisitionPrice(in millions)Japan Prime Realty Investment Corporation

Greater Tokyo (17 Properties)
Property
Number

Property Name

Location

Acquisition Date

PML (%)

Arca East

Sumida-ku, Tokyo

Nov. 16, 2001

¥5,880

1.4

7,022.76

3.2

B-2

JPR Chiba Bldg.

Chiba, Chiba

Dec. 13, 2001

2,350

0.6

5,536.82

3.9

B-3

JPR Yokohama Nihon Odori Bldg.

Yokohama, Kanagawa

Nov. 16, 2001

2,927

0.7

6,066.53

6.7

Sep. 25, 2002

920

0.2

570

0.1

5,284.75

10.5

B-5

Shinyokohama 2nd Center Bldg.

Yokohama, Kanagawa

Mar. 28, 2013

1,490

0.4

B-6

Kawaguchi Center Bldg.

Kawaguchi, Saitama

Feb. 13, 2004

8,100

2.0 15,420.09

6.8

B-7

JPR Ueno East Bldg.

Taito-ku, Tokyo

Mar. 1, 2004

3,250

0.8

6,490.05

3.9

Sep. 30, 2005

888

0.2

2,300

0.6

4,683.40

4.1

B-8

Tachikawa Business Center Bldg.

Tachikawa, Tokyo

Feb. 28, 2007

3,188

0.8

B-9

Rise Arena Bldg.

Toshima-ku, Tokyo

Mar. 22, 2007

5,831

1.4

6,023.39

1.3

B-10

Yume-ooka Office Tower

Yokohama, Kanagawa

Jul. 10, 2007

6,510

1.6 12,013.95

3.4

B-11

Olinas Tower

Sumida-ku, Tokyo

Jun. 29, 2009

31,3007.7 23,987.40

2.4

B-12

Tokyo Tatemono Yokohama Bldg.

Yokohama, Kanagawa

Dec. 27, 2010

7,000

1.7

6,494.09

5.2

B-13

Omiya Prime East

Saitama, Saitama

Mar. 22, 2013

6,090

1.5

6,871.45

2.4

B-1

Tanashi ASTA

Nishitokyo, Tokyo

Nov. 16, 2001

10,2002.5 31,121.71

3.5

B-3

Cupo-la Main Bldg.

Kawaguchi, Saitama

Mar. 31, 2006

2,100

0.5

5,963.00

8.1

B-4

JPR Musashikosugi Bldg.

Kawasaki, Kanagawa

Sep. 28, 2006

7,260

1.8 19,740.95

4.5

B-5

Musashiurawa Shopping Square

Saitama, Saitama

Mar. 19, 2007

4,335

1.1 14,960.69

7.1

B-6

Kawasaki Dice Bldg.

Kawasaki, Kanagawa

Apr. 12, 2007

15,0803.7 12,116.35

5.9¥122,891

30.3 189,797.38—

AcquisitionPrice(in millions)

Percentage of
Leasable
Portfolio Acquisition
Floor Space (m²)
Price (%)

PML (%)

Total

RetailPercentage of
Leasable
Portfolio Acquisition
Floor Space (m²)
Price (%)

B-1

Total

OfficeAcquisitionPrice(in millions)

Subtotal

Other Cities (15 Properties)
Property
NumberOfficeRetailProperty Name

Location

Acquisition Date

C-1

Niigata Ekinan Center Bldg.

Niigata, Niigata

Nov. 16, 2001

¥2,1400.5

5,326.88

1.7

C-4

Tokyo Tatemono Honmachi Bldg.

Osaka, Osaka

Nov. 16, 2001

4,150

1.0

7,163.07

4.3

C-7

JPR Hakata Bldg.

Fukuoka, Fukuoka

Nov. 16, 2001

2,900

0.7

6,568.43

0.5
5.7

C-9

JPR Naha Bldg.

Naha, Okinawa

Nov. 16, 2001

1,560

0.4

3,946.36

C-12

Sompo Japan Sendai Bldg.

Sendai, Miyagi

Jun. 26, 2002

3,150

0.8

7,129.14

2.0

C-13

Sompo Japan Wakayama Bldg.

Wakayama, Wakayama

Jun. 26, 2002

1,670

0.4

4,875.12

10.6

C-14

Tenjin 121 Bldg.

Fukuoka, Fukuoka

Jun. 21, 2002

2,810

0.7

3,257.73

1.6

C-17

JPR Dojima Bldg.

Osaka, Osaka

Jan. 23, 2004

2,140

0.5

3,930.71

5.0

C-18

JPR Hakata-chuo Bldg.

Fukuoka, Fukuoka

Jun. 11, 2004

1,920

0.5

3,290.42

0.8

C-19

JPR Nagoya Fushimi Bldg.

Nagoya, Aichi

Mar. 22, 2005

4,137

1.0

7,086.37

6.3

C-20

Yakuin Business Garden

Fukuoka, Fukuoka

Aug. 8, 2012

10,996

2.7 16,654.33

1.6

May 15, 2003

8,000

2.0
1.2 18,586.97

C-1

JPR Umeda Loft Bldg.

Osaka, Osaka

Jul. 16, 2003

5,000

4.3

Total

13,0003.2

C-3

Benetton Shinsaibashi Bldg.

Osaka, Osaka

May 30, 2005

5,430

1.3

5,303.98

11.5

C-4

Housing Design Center Kobe

Kobe, Hyogo

Sep. 28, 2005

7,220

1.8 35,444.13

7.2

C-5

JPR Chayamachi Bldg.

Osaka, Osaka

Aug. 30, 2006

6,000

1.5

2,484.39

8.4

Subtotal¥69,223

17.1 131,047.03

—

Total

¥405,520

100.0 468,232.24

2.0(Note 3) The PML indicates the figures stated in the Portfolio Earthquake PML Valuation Report prepared by Sompo Japan Nipponkoa Risk Management Inc., rounded off to the second decimal place.
Furthermore, as the company revised its evaluation method to analyze the risk of earthquakes in October 2014, the indicated figures have also been revised accordingly.

17

II. Overview of JPR

Portfolio Map
A Central Tokyo
A-11

A-14

Shinjuku

Shinjuku Ward

A-4
A-12

A-9
Chiyoda
A-24
Ward
A-17
A-4

Tokyo

A-21
Shibuya Ward

A-5

Ichigaya

A-23

Harajuku

A-3
A-1

Shinbashi

A-18

A-2 A-1

A-13

A-8
A-19
A-5 A-22

Chuo Ward

A-25

Shibuya

A-20
A-3

Minato Ward

Hamamatsucho

A-2

TamachiA-15

GotandaA-6
Shinagawa

A-7

A-16

A-10
OhsakiShinagawa Ward
RetailOffice
● A-1
● A-2
● A-3
● A-4
● A-5
● A-6
● A-7
● A-8
● A-9
● A-10● A-11● A-12● A-13Kanematsu Bldg.
Kanematsu Bldg. Annex
JPR Ningyo-cho Bldg.
Shin-Kojimachi Bldg.
JPR Crest Takebashi Bldg.
MS Shibaura Bldg.
Gotanda First Bldg.
Fukuoka Bldg.
JPR Ichigaya Bldg.
Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Bldg.
Across Shinkawa Bldg. Annex● A-14● A-15● A-16● A-17● A-18● A-19● A-20● A-21● A-22● A-23

Shinjuku Center Bldg.
Minami Azabu Bldg.
Shinagawa Canal Bldg.
Rokubancho Bldg.
JPR Harajuku Bldg.
Tokyo Tatemono Kyobashi Bldg.
JPR Nihonbashi-horidome Bldg.
JPR Sendagaya Bldg.
Ginza Sanwa Bldg.
The Otemachi Tower(Land with Leasehold Interest)● A-24 Science Plaza – Yonbancho Plaza● A-25 Shibadaimon Center Building

A Central Tokyo
Chiyoda Ward
Chuo Ward

18

Minato Ward
Shinjuku Ward

Shinagawa Ward
Shibuya Ward

■ A-1
■ A-2
■ A-3
■ A-4
■ A-5

JPR Shibuya Tower Records Bldg.
JPR Daikanyama
JPR Jingumae 432
Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)

B Greater Tokyo

C Other Cities

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

All other areas in Japan

Japan Prime Realty Investment Corporation

B Greater Tokyo (all other areas of Tokyo, Chiba, Kanagawa and Saitama Prefectures)
Office

Omiya

B-13

Musashiurawa

B-5● B-1 Arca East
● B-2 JPR Chiba Bldg.
● B-3 JPR Yokohama Nihon
Odori Bldg.
● B-5 Shinyokohama 2nd
Center Bldg.
● B-6 Kawaguchi Center Bldg.
● B-7 JPR Ueno East Bldg.
● B-8 Tachikawa BusinessCenter Bldg.
● B-9 Rise Arena Bldg.
● B-10 Yume-ooka Office Tower● B-11 Olinas Tower● B-12 Tokyo Tatemono
Yokohama Bldg.
● B-13 Omiya Prime East

Minamiurawa
Kawaguchi

B-6
B-3

SAITAMA

Matsudo

CHIBA

B-8

Ikebukuro

B-1

TOKYO Tanashi

B-9
Shinjuku

Tachikawa

B-11
B-1

Ueno

Funabashi

B-7

Kinshicho

Tokyo

Shibuya

Chiba

B-2

ShinagawaMusashikosugi

B-4

Musashikosugi

KANAGAWA
KawasakiB-6

B-5

Shin-Yokohama

B-12

Yokohama
Nihon-Odori

B-10

Retail
■ B-1
■ B-3
■ B-4
■ B-5

Tanashi ASTA
Cupo-la Main Bldg.
JPR Musashikosugi Bldg.
Musashiurawa Shopping
Square■ B-6 Kawasaki Dice Bldg.

B-3

Kamiooka

C Other Cities
Office● C-1 Niigata Ekinan Center Bldg.
● C-4 Tokyo Tatemono Honmachi Bldg.
● C-7 JPR Hakata Bldg.
● C-9 JPR Naha Bldg.
● C-12 Sompo Japan Sendai Bldg.
● C-13 Sompo Japan Wakayama Bldg.
● C-14 Tenjin 121 Bldg.
● C-17 JPR Dojima Bldg.
● C-18 JPR Hakata-chuo Bldg.
● C-19 JPR Nagoya Fushimi Bldg.
● C-20 Yakuin Business Garden

OSAKA

Retail
■ C-1
■ C-3
■ C-4
■ C-5

FUKUOKAJPR Umeda Loft Bldg.
Benetton Shinsaibashi Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.

C-7
C-14
C-18
C-20
NAHA

C-9

C-4
C-17
C-1
C-3
C-5

SENDAIC-12

NIIGATA

C-1

KOBE

C-4
NAGOYA

C-19
WAKAYAMA

C-13

19

II. Overview of JPR

Property Acquired in the 26th Fiscal Period
A-25

Shibadaimon Center Building (additional ownership)
JPR successfully achieved acquisition of additional ownership in anexisting property it owns, securely seizing the opportunity in the realestate market becoming increasingly overheated.

1. Property Overview
Location

1-10-11 Shibadaimon, Minato-ku, Tokyo

Completion

July 1993

Structure/Floors

S, SRC/flat roof B1/10F

Total site area

1,915.50 m2

Total floor space

11,419.93 m2

Property manager

Yasuda Real Estate Co., Ltd.

2. Transaction Summary
Seller(Note) 	The NOI yield of the property has been calculated by dividing the assumed income
for 12 months based on the rent level, the occupancy rate and other factors uponacquisition, by the acquisition price.

Individual

Acquisition price

¥800 million

Appraisal value

846 million yen (as of July 1, 2014)

Acquisition dateJuly 30, 2014

3. Assumed Income
NOI yield

4.7 %Portfolio Properties
Central Tokyo
A-1

OfficeRetailKanematsu Bldg.

A-2

Chuo Ward, Tokyo

Kanematsu Bldg. Annex
Chuo Ward, Tokyo

Acquisition Price¥2,874 million
Site Area
Total Floor Space

679.06 m2
4,351.46 m2

Structure/Floors

SRC B1/8F
CompletedFebruary 1993
Property Manager

Tokyo Tatemono Co., Ltd.

A-3

JPR Ningyo-cho Bldg.
Chuo Ward, Tokyo

Acquisition Price¥2,100 million
Site Area
Total Floor Space
Acquisition Price

Structure/Floors¥16,276 million
Site Area

2
2

14,995.09 m

20

4,117.70 m2

Structure/Floors

S/RC/SRC B2/13F
Completed

1,751.13 m
Total Floor Space

550.06 m2

SRC/RC B1/8F
CompletedFebruary 1993
Property Manager

Tokyo Tatemono Co., Ltd.

December 1989
Property Manager

Tokyo Tatemono Co., Ltd.

Japan Prime Realty Investment Corporation

Portfolio Properties
Central Tokyo
A-4

OfficeRetailShin-Kojimachi Bldg.

A-6

Chiyoda Ward, TokyoMS Shibaura Bldg.
Minato Ward, Tokyo

Acquisition Price¥2,420 million
Site Area
Total Floor Space

657.80 m2
5,152.98 m2

Structure/Floors

SRC B1/9F
Completed

October 1984
Property Manager

Tokyo Tatemono Co., Ltd.

A-5

JPR Crest Takebashi Bldg.
Chiyoda Ward, Tokyo

Acquisition Price¥4,000 million
Site Area
Total Floor Space

636.90 m2
4,790.68 m2
Acquisition Price

Structure/Floors
Completed

Site Area (Note)2

September 1999
Property Manager

Gotanda First Bldg.

A-8

Shinagawa Ward, Tokyo

SRC/RC/S B2/13F
Completed

8,992.18 m
Total Floor Space

Yasuda Real Estate Co., Ltd.

A-7

Structure/Floors¥11,200 million

SRC B1/9F

31,020.21 m2

February 1988
Property Manager

Tokyo Tatemono Co., Ltd.

Fukuoka Bldg.
Chuo Ward, Tokyo

Acquisition Price

Acquisition Price¥2,920 million
Site Area
Total Floor Space

¥2,920 million
Site Area

1,551.19 m2

Total Floor Space

10,553.34 m2

Structure/Floors

SRC/RC B2/11F

SRC B2/10F
Completed

July 1989

May 1990

Property Manager

Property Manager

Tokyo Tatemono Co., Ltd.

JPR Ichigaya Bldg.

Tokyo Tatemono Co., Ltd.

A-10

Chiyoda Ward, Tokyo

Oval Court Ohsaki Mark West
Shinagawa Ward, Tokyo

Acquisition Price

Acquisition Price¥3,500 million¥5,100 million
Site Area

2

Site Area

1,058.04 m
Total Floor Space

11,627.74 m2

Structure/Floors

Completed

A-9

1,302.17 m2

5,888.82 m2

Total Floor Space

4,006.00 m2
28,575.80 m2

Structure/Floors

Structure/Floors

S/SRC B2/17F

SRC B1/9F
Completed

Completed

June 2001

March 1989
Property Manager

Tokyo Tatemono Co., Ltd.

Property Manager

Tokyo Tatemono Co., Ltd.

21

II. Overview of JPR

Portfolio Properties
Central Tokyo
A-11

OfficeRetailShinjuku Square Tower

Acquisition Price

Structure/Floors¥10,180 million
Site Area

A-12

Shinjuku Ward, Tokyo

2
2

Acquisition Price

Completed

Structure/Floors¥15,121 million
Site Area

2

October 1994
Property Manager

78,796.00 m (entire redevelopment project)

A-13

Shinjuku Ward, Tokyo

S/RC/SRC B4/30F

8,409.52 m (entire redevelopment project)
Total Floor SpaceBYGS Shinjuku Bldg.

3,522.46 m
Total Floor SpaceTokyo Tatemono Co., Ltd.

Across Shinkawa Bldg. Annex

2

April 1985
Property Manager

25,733.10 m

A-14

Chuo Ward, Tokyo

SRC B2/14F
Completed

Tokyo Tatemono Co., Ltd.

Shinjuku Center Bldg.
Shinjuku Ward, Tokyo

Acquisition Price¥710 million
Site Area
Total Floor Space

858.48 m2
5,535.90 m2

Structure/Floors

S/SRC B2/10F
Completed

June 1994
Property Manager

Tokyo Tatemono Co., Ltd.

A-15

Minami Azabu Bldg.
Minato Ward, Tokyo

Acquisition Price¥3,760 million
Site Area
Total Floor Space

778.09 m2
4,570.63 m2
Acquisition Price

Structure/Floors

S
Completed

Site Area

June 1992
Property Manager

Tokyo Tatemono Co., Ltd.

22

Structure/Floors¥21,000 million

9F

2

SRC/RC/S B5/54F
Completed

14,917.11 m
Total Floor Space

176,607.89 m

2October 1979
Property Manager

Tokyo Tatemono Co., Ltd.

Japan Prime Realty Investment Corporation

Central Tokyo
A-16

OfficeRetailShinagawa Canal Bldg.

A-18

Minato Ward, TokyoJPR Harajuku Bldg.
Shibuya Ward, Tokyo

Acquisition Price¥1,870 million
Site Area
Total Floor Space

828.82 m2
5,216.21 m2

Structure/Floors

S

B1/8F

Completed

July 2008
Property Manager

Tokyo Tatemono Co., Ltd.

A-17

Rokubancho Bldg.
Chiyoda Ward, Tokyo

Acquisition Price¥2,800 million
Site Area
Total Floor Space

716.95 m2
4,205.09 m2
Acquisition Price

Structure/Floors

Site Area

Completed2

Total Floor SpaceTokyo Tatemono Kyobashi Bldg.

2

March 1989
Property Manager

6,466.94 m

Tokyo Tatemono Co., Ltd.

A-21

Chuo Ward, Tokyo

SRC B1/9F
Completed

1,205.07 m

October 1991
Property Manager

A-19

Structure/Floors¥8,400 million

SRC B3/7F

Tokyo Tatemono Co., Ltd.

JPR Sendagaya Bldg.
Shibuya Ward, Tokyo

Acquisition Price¥5,250 million
Site Area
Total Floor Space

547.10 m2
4,419.79 m2

Structure/Floors

SRC/S B1/10F
Completed

January 1981
Property Manager

Tokyo Tatemono Co., Ltd.

A-20

JPR Nihonbashi-horidome Bldg.
Chuo Ward, Tokyo

Acquisition Price¥5,100 million
Site Area
Total Floor Space

937.59 m2
7,190.82 m2
Acquisition Price

Structure/Floors
Completed

Structure/Floors¥15,050 million

SRC B1/9F
Site Area

June 2002
Property Manager

Tokyo Tatemono Co., Ltd.

2

S 8F
Completed

2,217.49 m
Total Floor Space

7,683.19 m

2

May 2009
Property Manager

Tokyo Tatemono Co., Ltd.

23

II. Overview of JPR

Portfolio Properties
Central Tokyo
A-22

OfficeRetailGinza Sanwa Bldg.

A-23

Chuo Ward, Tokyo

The Otemachi Tower (Land with Leasehold Interest)
Chiyoda Ward, Tokyo

Acquisition Price¥3,400 million
Site Area

1,119.27 m2

Total Floor Space

8,851.00 m2

Structure/Floors

SRC B2/9F
Completed

October 1982
Property Manager

Mitsubishi Jisho Property Management Co., Ltd.

A-24

Science Plaza - Yonbancho Plaza
Chiyoda Ward, Tokyo

Acquisition Price¥2,660 million
Site Area

5,289.01 m2

Total Floor Space

24,560.36 m2

Structure/Floors

Acquisition Price

Structure/Floors¥36,000 million
Site Area

S/SRC/RC B2/12F
Completed

Total Floor Space

11,034.78 m2

February 1995
Property Manager

Yasuda Real Estate Co., Ltd.

A-25

Shibadaimon Center Building–

Property Manager––**	Since the property consists of land with leasehold interest only, no property managementcompany has been appointed.

A-1

Minato Ward, Tokyo–
Completed

JPR Shibuya Tower Records Bldg.
Shibuya Ward, Tokyo

Acquisition Price¥3,420 million
Site Area

1,915.50 m2

Total Floor Space

11,419.93 m2

Structure/Floors

S/SRC B1/10F
Completed

July 1993
Property Manager

Yasuda Real Estate Co., Ltd.

A-2

JPR Daikanyama
Shibuya Ward, Tokyo

Acquisition Price¥2,160 million
Site Area

277.12 m2

Total Floor Space

668.09 m2
Acquisition Price

Structure/Floors

Site Area

Completed

Jones Lang LaSalle K.K.

2

SRC/S B3/8F
Completed

1,010.47 m

July 2002
Property Manager

24

Structure/Floors¥12,000 million

RC B2/2F
Total Floor Space

8,449.56 m

2

February 1992
Property Manager

Tokyo Tatemono Co., Ltd.

Japan Prime Realty Investment Corporation

Central Tokyo
A-3

OfficeRetail/ Greater Tokyo Office Retail

JPR Jingumae 432

A-4

Shibuya Ward, Tokyo

Shinjuku Sanchome East Bldg.
Shinjuku Ward, Tokyo

Acquisition Price

Acquisition Price¥4,275 million
Site Area¥2,740 million
Site Area

22,578.69 m2

198.10 m
Total Floor Space

Total Floor Space

1,066.81 m2

Structure/Floors

24,617.65 m2

Structure/Floors

S/SRC B1/7F

S/SRC/RC B3/14F

Completed

CompletedFebruary 2006

January 2007

Property Manager

Property Manager

Jones Lang LaSalle K.K.

A-5

Yurakucho Ekimae Bldg. (Yurakucho Itocia)

Tokyo Tatemono Co., Ltd.

B-1

Chiyoda Ward, Tokyo

Arca East
Sumida Ward, Tokyo

Acquisition Price

Acquisition Price¥3,400 million
Site Area¥5,880 million
Site Area

23,755.01 m2

6,808.12 m
Total Floor Space

Total Floor Space

71,957.65 m2

Structure/Floors

34,281.86 m2

Structure/Floors

S/SRC B4/20F

S/SRC B3/19F

Completed

Completed

October 2007

March 1997

Property Manager

Property Manager

Tokyo Tatemono Co., Ltd.

B-2

JPR Chiba Bldg.

Tokyo Tatemono Co., Ltd.

B-5

Chiba City, Chiba

Shinyokohama 2nd Center Bldg.
Yokohama City, Kanagawa

Acquisition Price¥2,350 million
Site Area

1,382.35 m2

Total Floor Space

9,072.57 m2

Structure/Floors

S/SRC B1/13F
Completed

January 1991
Property Manager

Tokyo Tatemono Co., Ltd.

B-3

JPR Yokohama Nihon Odori Bldg.
Yokohama City, Kanagawa

Acquisition Price¥2,927 million
Site Area
Total Floor Space

1,100.59 m2
9,146.52 m2
Acquisition Price

Structure/Floors
Completed

Structure/Floors¥1,490 million

SRC B1/11F
Site Area (Note)

October 1989
Property Manager

Tokyo Tatemono Co., Ltd.

2

S/SRC B2/12F
Completed

841.71 m
Total Floor Space

7,781.93 m

2August 1991
Property Manager

Nomura Real Estate Partners Co., Ltd.

25

II. Overview of JPR

Portfolio Properties
Greater Tokyo
B-6

OfficeRetailKawaguchi Center Bldg.

JPR Ueno East Bldg.

B-7

Kawaguchi City, Saitama

Taito Ward, Tokyo

Acquisition Price

Acquisition Price¥8,100 million
Site Area¥3,250 million
Site Area

2

1,242.97 m2

4,524.61 m
Total Floor Space

Total Floor Space

28,420.85 m2

Structure/Floors

8,490.44 m2

Structure/Floors

S/SRC B2/15F

S/SRC B1/8F

Completed

CompletedFebruary 1994

October 1992

Property Manager

Property Manager

Nomura Real Estate Partners Co., Ltd.

B-8

Tachikawa Business Center Bldg.

Yasuda Real Estate Co., Ltd.

Rise Arena Bldg.

B-9

Tachikawa City, Tokyo

Toshima Ward, Tokyo
Acquisition Price

Acquisition Price¥3,188 million
Site Area
Total Floor Space

Site Area

9,377.28 m (entire redevelopment project)

2,047.22 m2

Total Floor Space

2

Structure/Floors

91,280.94 m2 (including residential tower)

14,706.36 m
Structure/Floors
Completed

Taisei-Yuraku Real Estate Co., Ltd.

Property Manager*The commercial tower portion has 2 basement
floors and 15 floors above ground.

Tokyo Tatemono Co., Ltd.

Yume-ooka Office Tower

January 2007

Property Manager

December 1994

B-11

Yokohama City, Kanagawa

RC/SRC/S B3/42F*

Completed

S/SRC B1/12F

B-10¥5,831 million
2

Olinas Tower
Sumida Ward, Tokyo

Acquisition Price¥6,510 million
Site Area
Total Floor Space

12,011.00 m2
185,974.87 m2

Structure/Floors

S/SRC/RC B3/27F
Completed

March 1997
Property Manager

Tokyo Tatemono Co., Ltd.

B-12

Tokyo Tatemono Yokohama Bldg.
Yokohama City, Kanagawa

Acquisition Price¥7,000 million
Site Area
Total Floor Space

1,110.28 m2
8,772.51 m2

Structure/Floors

Structure/Floors¥31,300 million
Site Area

SRC B1/9F
CompletedMay 1981
Tokyo Tatemono Co., Ltd.

SRC/RC/S B2/45F*
Completed

27,335.29 m2 (entire site area)

Total Floor Space

Property Manager

26

Acquisition Price

2257,842.41 m(includes commercial tower and residential tower)

Property Manager

March 2006

Tokyo Tatemono Co., Ltd.

*The office building has 31 floors above ground and 2 floors underground.

Japan Prime Realty Investment Corporation

Greater Tokyo
B-13

OfficeRetailOmiya Prime East

B-1

Saitama City, Saitama

Tanashi ASTA
Nishitokyo City, Tokyo

Acquisition Price¥6,090 million
Site Area

2,268.09 m2

Total Floor Space

9,203.98 m2

Structure/Floors

S 9F
CompletedFebruary 2009
Property Manager

Tokyo Tatemono Co., Ltd.

B-3

Cupo-la Main Bldg.
Kawaguchi City, Saitama

Acquisition Price¥2,100 million
Site Area2

15,008.28 m (entire redevelopment project)
Total Floor Space

48,321.96 m2
Acquisition Price

Structure/Floors
Completed

Site Area

2

January 2006
Property Manager

JPR Musashikosugi Bldg.

2

February 1995
Property Manager

80,675.27 m

B-6

Kawasaki City, Kanagawa

SRC B2/17F
Completed

12,326.30 m
Total Floor SpaceTokyo Tatemono Co., Ltd.

B-4

Structure/Floors¥10,200 million

S/RC/SRC B2/10F

Tokyo Tatemono Co., Ltd.

Kawasaki Dice Bldg.
Kawasaki City, Kanagawa

Acquisition Price¥7,260 million
Site Area

4,761.62 m2

Total Floor Space

18,394.32 m2

Structure/Floors

SRC/RC/S B1/6F
Completed

March 1983
Property Manager

Tokyo Tatemono Co., Ltd.

B-5

Musashiurawa Shopping Square
Saitama City, Saitama
Acquisition Price¥4,335 million
Site Area
Total Floor Space

8,317.99 m2
28,930.36 m2

Structure/Floors

S B1/4F
Completed

October 2005
Property Manager

Nippon Steel Kowa Real Estate Co., Ltd.
Tokyo Tatemono Co., Ltd.

Acquisition Price

Structure/Floors¥15,080 million
Site Area

4,475.45 m2

Total Floor Space

36,902.01 m

2

S/SRC/RC B2/11F
Completed

August 2003
Property Manager

Tokyo Tatemono Co., Ltd.

27

II. Overview of JPR

Portfolio Properties
Other Cities
C-1

OfficeRetailNiigata Ekinan Center Bldg.

C-4

Niigata City, Niigata

Tokyo Tatemono Honmachi Bldg.
Osaka City, Osaka

Acquisition Price

Acquisition Price¥2,140 million
Site Area¥4,150 million
Site Area

22,706.99 m
Total Floor Space

Total Floor Space

19,950.42 m2

Structure/Floors

14,619.52 m2

Structure/Floors

S/SRC B1/10F

SRC B3/9F

Completed

Completed

March 1996

February 1970

Property Manager

Property Manager

Jones Lang LaSalle K.K.

C-7

1,432.64 m2

JPR Hakata Bldg.

Tokyo Tatemono Co., Ltd.

C-9

Fukuoka City, Fukuoka

JPR Naha Bldg.
Naha City, Okinawa

Acquisition Price¥2,900 million
Site Area
Total Floor Space

Acquisition Price¥1,560 million

2

1,214.63 m

Site Area

9,828.73 m2

Total Floor Space

S/SRC B1/12F

Structure/Floors

Structure/Floors

June 1985
expansion in November 2003

Completed

October 1991

Property Manager

Property Manager

Tokyo Tatemono Co., Ltd.

Sompo Japan Sendai Bldg.

Tokyo Tatemono Co., Ltd.

C-13

Sendai City, Miyagi

Sompo Japan Wakayama Bldg.
Wakayama City, Wakayama

Acquisition Price

Acquisition Price¥3,150 million
Site Area¥1,670 million
Site Area

2

1,895.67 m
Total Floor Space

Total Floor Space

10,783.52 m2

Structure/Floors

SRC B1/12F

S 9F

December 1997

July 1996
Property Manager

Tokyo Tatemono Co., Ltd.

Tenjin 121 Bldg.

Tokyo Tatemono Co., Ltd.

C-17

Fukuoka City, Fukuoka

Acquisition Price

JPR Dojima Bldg.
Osaka City, Osaka

Acquisition Price¥2,810 million
2¥2,140 million
Site Area

1,164.39 m
Total Floor Space

8,690.95 m2

Structure/Floors

Total Floor Space668.11 m2
5,696.01 m2

Structure/Floors

S/SRC 13F
Completed

SRC B2/9F
Completed

July 2000
Property Manager

Tokyo Tatemono Co., Ltd.

28

6,715.07 m2

Completed

Property Manager

Site Area

1,128.45 m2

Structure/Floors

Completed

C-14

5,780.71 m2
SRC/S 12F

Completed

C-12

959.87 m2

October 1993
Property Manager

Tokyo Tatemono Co., Ltd.

Japan Prime Realty Investment Corporation

Other Cities
C-18

OfficeRetailJPR Hakata-Chuo Bldg.

C-20

Fukuoka City, Fukuoka

Yakuin Business Garden
Fukuoka City, Fukuoka

Acquisition Price¥1,920 million
Site Area
Total Floor Space680.63 m2
3,874.81 m2

Structure/Floors

SRC 8F
CompletedFebruary 1993
Property Manager

Tokyo Tatemono Co., Ltd.

C-19

JPR Nagoya Fushimi Bldg.
Nagoya City, Aichi

Acquisition Price¥4,137 million
Site Area
Total Floor Space

1,610.38 m2
10,201.44 m2

Structure/Floors

SRC B1/9F
Completed

March 1991
Property Manager

Tokyo Tatemono Co., Ltd.

C-1

JPR Umeda Loft Bldg.

Acquisition Price
Site Area

4,348.43 m2

Total Floor Space2

SRC 14F
Completed

January 2009
Property Manager

22,286.35 m

C-3

Osaka City, Osaka

Structure/Floors¥10,996 million

Tokyo Tatemono Co., Ltd.

Benetton Shinsaibashi Bldg.
Osaka City, Osaka
Acquisition Price¥5,430 million

Acquisition Price¥13,000 million
Site Area
Total Floor Space

Site Area

3,518.68 m2

Total Floor Space

17,897.56 m2

Structure/Floors

SRC B1/8F

CompletedFebruary 2003
expansion in January 2005

Completed

April 1990

Property Manager

Property Manager

Tokyo Tatemono Co., Ltd.

Tokyo Tatemono Co., Ltd.

Housing Design Center Kobe

C-5

Kobe City, Hyogo

Acquisition Price

JPR Chayamachi Bldg.
Osaka City, Osaka

Acquisition Price¥7,220 million
Site Area2¥6,000 million
Site Area

3,994.47 m
Total Floor Space

5,303.98 m2
S B2/10F

Structure/Floors

C-4

609.31 m2

33,877.71 m2

Structure/Floors

Total Floor Space592.45 m2
3,219.36 m2

Structure/Floors

SRC/S B2/11F
Completed

S/SRC 9F
Completed

June 1994
Property Manager

Tokyo Tatemono Co., Ltd.

June 1994
Property Manager

Tokyo Tatemono Co., Ltd.

29

II. Overview of JPR

8. Structure and History of JPR
The Objective and Basic Characteristics of JPR
With the fundamental concept of “investment in urban commercial real estate,” JPR shall invest primarily in realestate, which comprises superior urban office buildings (urban commercial facilities), retail properties found in
thriving commercial areas, multi-use facilities and the land on which they are located as well as in asset-backed
securities that have such real estate as their primary investments.
In addition, in light of the returns and risks of these investment targets, JPR shall make it a basic policy to invest
not only in Tokyo, but also strive to diversify into other regional cities so as to maximize the advantages of
portfolio management.

Corporate History
Date

Description

September 6, 2001

The founder (Tokyo Realty Investment Management, Inc.) filed for establishment of the investment corporation under Article69-1 of the Act on Investment Trusts and Investment Corporations (Investment Trusts Act)

September 14, 2001

Japan Prime Realty Investment Corporation was registered and established under Article 166 of the Investment Trusts Act

November 16, 2001

Started asset management (acquisition of real estate beneficiary interests in trust for 13 underlying trust assets comprising 11
office properties and 2 retail properties) (¥40,730 million in total)

January 22, 2002

Investment unit split (2.5 units for 1 existing unit) pursuant to Article 87 of the Investment Trusts Act

June 14, 2002

Listed on the Real Estate Investment Trust Section of the Tokyo Stock Exchange and started trading

Structure of JPR

Administrative Agent forEnvironment-Related Laws andRegulations

40%

20%

20%

10%

10%

Tokyo Tatemono

Taisei Corporation

Yasuda Real Estate

Sompo Japan Nipponkoa
Insurance Inc.

Meiji Yasuda
Life Insurance

Asset Manager
Tokyo Realty Investment
Management, Inc.

Tokyo Tatemono Co., Ltd.

Entrustment of
Asset Management

Tenant Agents

Tokyo Tatemono Co., Ltd.

Japan Prime Realty
Investment Corporation

Tokyo Tatemono Co., Ltd.
Yasuda Real Estate Co., Ltd.
Taisei Corporation

Loans / Issue
of Investment
Corporation
Bonds

Asset
Management
Property

General Tenant Services Agent /Construction Management Agent /Property Transfer Agent /Administrative Agent forEnvironment-Related Laws andRegulations

Liabilities
EquityInvestment

AssetsUnitholders'EquityProperty Manager

Cash
Distribution

Lender / Investment
Corporation Bond Investor

Unitholders
Transaction
Unitholders

Entrustment of Entrustment ofgeneralasset custodyadministration

30

Asset Custodian

General Administrator

Mizuho Trust & Banking, Co., Ltd.

Mizuho Trust & Banking, Co., Ltd.
and others

Japan Prime Realty Investment Corporation

9. Overview of Asset Manager
Overview
Name
Business Description
Capitalization

Shareholder
Composition (Note 1)

Tokyo Realty Investment Management, Inc. (TRIM)
Asset management for investment corporation¥350 million
Tokyo Tatemono Co., Ltd. (40%)
Taisei Corporation (20%)
Yasuda Real Estate Co., Ltd. (20%)
Sompo Japan Nipponkoa Insurance Inc. (10%)
Meiji Yasuda Life Insurance Company (10%)

Corporate History

April 28, 2000

EstablishedObtained license as real estate transaction agent(currently: No. (3) 79025 licensed by Governor of Tokyo)
Obtained license as discretionary transaction agent under the Building Lots and Building Transactions Business Act(Approval Number: No. 3)
Obtained license as asset management agent for investment corporation under the Act on Investment Trusts andInvestment Corporations (Approval Number: No. 7 licensed by the Prime Minister)
Registered for financial instruments exchange business (investment management business)(Registration Number: No.362 (Kinsho) Head of Kanto Local Finance Bureau) (Note 2)

October 13, 2000
March 16, 2001
June 20, 2001
September 30, 2007
November 28, 2007

Applied for registration and submitted application form for financial instruments exchange business(Note 1) The percentage represents the ratio of the number of respective shares with voting rights to the total number of shares with voting rights.
(Note 2) 	Tokyo Realty Investment Management, Inc. was deemed to have been registered as investment management business, applicable to the Supplementary Provisions Article 159-1 of the Act for
Partial Revision of the Securities and Exchange Act, etc. (Act No. 65 of 2006).

Organization Chart
Shareholders’ Meeting
Auditors
Board of Directors

Investment Committee(Investment Subcommittee /Fund Management
Subcommittee)

President & CEO

Compliance Committee(Compliance Subcommittee)
Compliance Office

Investment Management
Division

Financial DivisionCorporate Planning /Administration Division

Research Group
Asset
Asset
Asset
Asset
Investment Management Management Management EngineeringGroup
3 Group
1 Group
2 GroupGroup

FinancialGroup

IR Group

FundManagement
Group

Planning
Group

GeneralAdministration
Group

Decision-Making Institutions for Investment Management
TRIM has established the Investment Committee as the institution to make investment management decisions,as well as the Investment Subcommittee (including the Due Diligence Subcommittee) and the Fund Management
Subcommittee as subsidiary bodies of the Committee. These committees comprise the President and CEO,
Investment Management Division General Manager, Financial Division General Manager, and Corporate Planning/ Administration Division General Manager. The Compliance Office General Manager also participates in thesecommittees to enhance confirmation in terms of legal compliance.
Matters concerning the targets and policies of investment management are decided by the Board of Directors, andmatters concerning planning and implementation of asset management are decided by the Investment Committee.
Matters concerning acquisition, disposition or management of individual properties are decided by the Investment
Subcommittee or the Fund Management Committee, respectively. Moreover, the Board of Directors has final
decision-making authority for acquisitions and dispositions of individual assets having over a certain amount of value.
31III. Asset Management Report

1. Overview of Asset Management(1) Changes in Operating Results and Other Management Data
Fiscal Period

Unit

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

Million yen

22nd Fiscal
Period(Jul. 1, 2012 Dec. 31, 2012)
12,963

Million yen

12,963

13,27813,591

13,734

13,902Million yen

6,198

6,893

7,223

7,308

7,425

Million yen

5,519

6,208

6,534

6,599

6,733

Million yen

6,765

6,385

6,368

6,425

6,477

Million yen

5,026

4,975

4,899

5,073

5,239

Million yen

5,025

4,974

4,954

5,072

5,238

Million yen

401,984

409,715

413,974

414,104

414,091㻌

Reference
Information

Financial Indices

Cash Distribution per
Unit, etc.

Assets, etc.

Operating Performance㻌(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)%23rd Fiscal
Period(Jan. 1, 2013 Jun. 30, 2013)13,27824th Fiscal
Period(Jul. 1, 2013 Dec. 31, 2013)
13,591

25th Fiscal
Period(Jan. 1, 2014 Jun. 30, 2014)
13,73426th Fiscal
Period(Jul. 1, 2014 Dec. 31, 2014)
13,902(+1.5)(+1.9)(+1.0)(+0.0)(-0.0)

Million yen

180,557

187,158

191,759

191,190

191,024

Million yen

197,168

197,116

197,095

197,213

197,378%(+12.0)(-0.0)(-0.0)(+0.1)(+0.1)

Million yen

192,044

192,044

192,044

192,044

192,044

Million yen

5,026

4,975

4,954

5,073

5,239

%

100.0

100.0

100.0

100.0

100.0

Units

825,000

825,000

825,000

825,000

825,000

Yen

238,992

238,929

238,903

239,046

239,246

Yen

6,093

6,031

6,006

6,150

6,351

Yen

6,093

6,031

6,006

6,150

6,351

Yen
%

－
1.3

－
1.2

－
1.2

－
1.2

－
1.3

%

2.5

2.5

2.4

2.5

2.5

%

2.7

2.5

2.5

2.6

2.7

%

5.3

5.1

5.0

5.2

5.3

176,035

197,168

197,116

197,095

197,213

49.0

48.1

47.6

47.6

47.7

(+4.6)(-0.9)(-0.5)(+0.0)(+0.0)

%

44.9

45.7

46.3

46.2

46.1

Times

6.0

6.3

6.1

6.5

7.2

Million yen

8,226

8,163

8,149

8,167

8,223

Million yen

1,368

1,304

1,325

1,259

1,142

Million yen

9,275

8,953

8,925

8,968

9,010

%

4.7

4.5

4.4

4.5

4.4

Million yen

8,595

8,359

8,080

8,287

8,303

%

4.4

4.2

4.0

4.1

4.1

Million yen

%

59

60

62

62

62

534

564

610

628

632

m2

450,943.43

460,452.47

467,207.05

467,175.54

468,232.24

%

94.9

96.9

96.5

97.8

97.0

㻌
㻌

Ordinary income / (total assets at beginning of period + total assets at end of period) / 2
Net income / (total unitholders' equity at beginning of period + total unitholders' equity at end of period) / 2
Total unitholders' equity at end of period / total assets at end of period x 100
Interest-bearing debt / total assets at end of period x 100
Net income before interest and amortization / interest expenses (including interest expenses on investment corporation bonds)
Net income - gain on sale of real estate + loss on sale of real estate + loss on sale of investment securities + extraordinary loss + interest expenses (includinginterest expenses on investment corporation bonds) + depreciation(Note 7) (Real estate rental revenues - real estate rental expenses) + depreciation(Note 8) NOI from leasing - capital expenditures(Note 9) Annualized NOI from leasing / property acquisition price (22nd fiscal period: ¥391.98 billion, 23rd fiscal period: ¥398.64 billion, 24th fiscal period: ¥404.72
billion, 25th fiscal period: ¥404.72 billion and 26th fiscal period: ¥405.52 billion)

32
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Japan Prime Realty Investment Corporation

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: 22nd fiscal period: 184 days, 23rd fiscal period: 181 days,
24th fiscal period: 184 days, 25th fiscal period: 181 days and 26th fiscal period: 184 days.
(Note 11) Shin-Kojimachi Bldg., Fukuoka Bldg., Shinjuku Square Tower, BYGS Shinjuku Bldg., Shibadaimon Center Bldg., Shinjuku Sanchome East Bldg.,
Shinyokohama 2nd Center Bldg., Tachikawa Business Center Bldg. and JPR Umeda Loft Bldg. were acquired at multiple times but 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 off to the first decimal place).

(2) 26th Fiscal Period Asset Management
1) Milestones of JPR
Japan Prime Realty Investment Corporation (JPR) was established on September 14, 2001 under the Act on Investment Trusts
and Investment 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. Subsequently, JPR
conducted five public offerings and other equity financing measures, with the number of investment units issued and outstanding
totaling 825,000 units at present. 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 26th fiscal period, the Japanese economy showed a slight slowdown as consumer spending failed to pick up the paceof recovery and private capital investment grew slower than what was assumed. Nevertheless, there were continued expectations
for economic recovery coming ahead thanks to the additional monetary easing implemented by the Bank of Japan and the
postponement of the additional hike in the consumption tax rate, among other factors. 
The Office Property Leasing Market
The supply and demand balance in the office property leasing market of the 23 wards of Tokyo further improved due toexpansion in new demand for such positive development as setting up new offices, expanding the office spaces and moving tobetter locations. Given this situation, the upward trend of the rent levels for new contracts has been strengthened for Class S andClass A buildings, and the positive impact is increasingly spreading through the entire market including Class B buildings, suchas the rent-free periods granted to new tenants being reduced.
The Retail Property Leasing Market
There had been concerns about negative impacts of the consumption tax increase particularly on retail properties. However, suchimpacts that had been worried about were hardly found for urban retail properties in which JPR targets to invest, as tenant’s needs
to open stores remained strong. The vacancies in urban retail properties in good locations, such as Ginza and Omotesando, havealmost vanished, with rents having taken an upward turn and increasing.
The For-Sale Real Estate Market
The transaction volume expanded, including deals of large-scale projects, as initial public offerings and public offerings by
REITs took place one after another against the backdrop of a favorable fund procurement environment. However, with a distinct
trend of acquisitions of properties by REITs being made from their sponsors, the supply and demand situation in the for-sale realestate market is becoming increasingly tighter, mainly for quality properties. Moreover, transactions in the market include
increasingly notable property acquisitions by foreign investors as well as private placement REITs. Because of the decreased cap
rates, combined with expectations for recovery of rental revenues, the transaction price of real estate is being formed at an evenhigher level, and there is an expanding tendency to invest in projects located in regional cities.
3) Portfolio Management Status
New Property Acquisitions
JPR investigates possible investments mainly in office properties in the Tokyo area, plus retail properties and office properties inregional cities, with the primary aim of improving the quality and stabilizing earnings of the portfolio while paying attention tobalancing diversification of the portfolio, both in terms of location and asset type.
During the 26th fiscal period, JPR acquired Shibadaimon Center Building (additional acquisition) at the acquisition price of 800
million yen. As a result, the balance of assets under management totaled 62 properties, or 405.5 billion yen on an acquisition
price basis, as of the end of December 2014, with the total leasable floor space standing at 468,232m 2 and the number of tenantsreaching 632.
Operational Management of Portfolio
In the office property leasing market in the 26th fiscal period, the vacancy rate showed a downward trend, given a more advanced
improvement in the supply and demand balance in Tokyo and other areas. Under such circumstances, JPR endeavored to attract
new tenants through strategic leasing activities and enhance the satisfaction of existing tenants by keeping close cooperation withproperty management companies and brokers, with an aim of enhancing earnings from the entire portfolio and improving

33
35

III. Asset Management Report

occupancy rates. As a result, JPR successfully kept the occupancy rate at a high level, which stood at 97.0% at the end of the
fiscal period.
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 the aim to create spaces where theworkers feel satisfaction. As an endeavor to implement energy-saving measures, JPR conducted renovation of air-conditioning
systems and replacement of lighting equipment in the common areas with LED lamps, which are expected to be effective for theendeavor, at its multiple properties.
In addition, JPR is continuously working to obtain environmental certifications (the DBJ Green Building Certification *1 and therecognition by GRESB*2). In the 26th fiscal period, JPR additionally received the DBJ Green Building Certification for four
properties in its portfolio, and was designated as “Green Star,” the highest ranking, in the GRESB survey conducted in 2014. As
these achievements show, JPR is proactively engaged in environmental friendliness.
*1 The DBJ Green Building Certification is a certification system by Development Bank of Japan Inc., designed to select superior real estate that meets the demandof the times, with a purpose of promoting properties that are environmentally friendly, equipped to mitigate disaster and prevent crime, as well as meet thevarious social requirements surrounding real estate from stakeholders (“Green Buildings”)*2 GRESB, which stands for Global Real Estate Sustainability Benchmark, is a benchmark system for analyzing and evaluating sustainability of real estatecompanies, REITs and real estate private placement funds, in terms of environmental friendliness and social nature. It is based on surveys conducted by a groupof the same name composed of more than 20 organizations worldwide such as European pension asset managers.

Fund Procurement
JPR is engaged in conservative financial operations, setting the ceiling of the interest-bearing debt ratio (hereafter the “LTV”)(Note 1) at 55% as a rule and working to control the ratio largely at 50% or lower in practice.
In debt financing, JPR continued to maintain financial stability by conducting bank borrowings at long-term fixed interest rates
with an eye on reducing risks of rising interest rates while remaining attentive to the diversification of repayment dates, etc.
JPR established a commitment line with credit limit of 28 billion yen in order to reduce refinancing risks and secure stable fundprocurement.
In the 26th fiscal period, JPR procured funds of 23.0 billion yen in total, including refinancing of loans and investment
corporation bonds upon maturity. As a result, the balance of total outstanding borrowings as of the end of the fiscal period was
136.5 billion yen, with investment corporation bonds of 54.5 billion yen.
As of the end of the 26th fiscal period, JPR had LTV of 46.4%, long-term and fixed interest-bearing debt ratio (Note 2) of 98.2%,
average interest rate (Note 3) of 1.16%, and average maturity (Note 4) of 3.9 years. Furthermore, the current portion of long-term
interest-bearing debt was 32.7 billion yen.
The following represents the issuer ratings for JPR as of the end of this fiscal period.
Details of Corporate Credit Ratings as of December 31, 2014
Credit Rating Agency
Rating and Investment Information, Inc.

Corporate Credit Rating
AA- (Stable)

Standard & Poor's Ratings Japan K.K.

Long-term: A (Stable)
Short-term: A-1(Note 1) LTV: (borrowings + investment corporation bonds)/ total value of assets
Total value of assets is calculated by adding or subtracting the difference between the appraisal value at end of period and the book value at end of period of
the specified assets owned by JPR to the total assets.
(Note 2) Long-term and fixed interest-bearing debt ratio: long-term, fixed-interest interest-bearing debt / total interest-bearing debt
(Note 3) Average interest rate is arrived at by calculating a weighted average of interest rates for all interest-bearing debt as of the end of the 26th fiscal period basedon the balance of each interest-bearing debt.
(Note 4) Average maturity is arrived at by calculating a weighted average of maturities from the end of the 26th fiscal period to the repayment deadlines for all
interest-bearing debt based on the balance of each interest-bearing debt.

34
36

Japan Prime Realty Investment Corporation(3) Additional Offerings, etc.
The table below indicates additional offerings, etc. JPR has conducted since inception through the 26th fiscal period.
Date

Event

Number of Units
Outstanding

Unitholders' Capital(millions of yen)

Variation
240

Balance240

Variation
120

Balance
120

Remarks

September 14, 2001

Established by private placement

November 16, 2001

Additional private placement

62,00062,24031,00031,120(Note 1)
(Note 2)January 22, 2002

Split of investment units

93,360155,600

31,120(Note 3)June 14, 2002

Initial public offering

134,000

289,600－
25,862

56,982(Note 4)

July 15, 2003

Additional public offering

134,400

424,000

30,75887,740(Note 5)

August 9, 2003

Third-party allotment

6,000

430,000

1,373

89,113(Note 6)

February 1, 2005

Additional public offering

95,000525,000

25,001

114,115(Note 7)

March 1, 2005

Third-party allotment

5,000

530,000

1,315

115,431(Note 8)February 6, 2007

Additional public offering

90,000620,000

39,120154,552(Note 9)March 7, 2007

Third-party allotment

5,000

625,000

2,173

156,725(Note 10)February 8, 2010

Additional public offering

82,000707,000

13,315170,040(Note 11)

March 12, 2010

Third-party allotment

8,000

715,000

1,299

171,339(Note 12)

July 30, 2012

Additional public offering

101,420

816,420

19,089190,429(Note 13)

August 29, 2012

Third-party allotment

8,580

825,000

1,614

192,044(Note 14)

(Note 1)

JPR was formed by the investment of three companies Tokyo Tatemono Co., Ltd. (100 units), Taisei Corporation (100 units), and Tokyo Realty Investment(Note 2)

An additional offering was made via private placement at 500,000 yen per unit. JPR then acquired 13 beneficiary interests in real estate trust and started

Management, Inc. (40 units) at 500,000 yen per unit.
management.
(Note 3)(Note 4)

A single investment unit was split into 2.5 units.
New investment units were issued through a public offering at 200,000 yen per unit (underwriting price of 193,000 yen per unit) to repay short-term debt,
finance the acquisition of new specific assets, etc.

(Note 5)New investment units were issued through a public offering at 237,160 yen per unit (underwriting price of 228,859 yen per unit) to repay short-term debt,
acquire new specific assets, etc.

(Note 6)

New investment units were issued through a third-party allotment at 228,859 yen per unit to repay short-term debt, acquire new specific assets, etc.

(Note 7)

New investment units were issued through a public offering at 272,440 yen per unit (underwriting price of 263,177 yen per unit) to repay short-term debt,
acquire new specific assets, etc.

(Note 8)(Note 9)New investment units were issued through a third-party allotment at 263,177 yen per unit to repay short-term debt, acquire new specific assets, etc.
New investment units were issued through a public offering at 449,820 yen per unit (underwriting price of 434,673 yen per unit) to repay debt, acquire new
specific assets, etc.

(Note 10)

New investment units were issued through a third-party allotment at 434,673 yen per unit to repay debt, acquire new specific assets, etc.

(Note 11)

New investment units were issued through a public offering at 168,101 yen per unit (underwriting price of 162,382 yen per unit) to repay short-term debt,
redeem investment corporation bonds, acquire new specific assets, etc.

(Note 12)

New investment units were issued through a third-party allotment at 162,382 yen per unit to repay short-term debt, redeem investment corporation bonds,
acquire new specific assets, etc.

(Note 13)

New investment units were issued through a public offering at 194,610 yen per unit (underwriting price of 188,222 yen per unit) to partly fund acquisition of
new specific assets and repay debts.

(Note 14)

New investment units were issued through a third-party allotment at 188,222 yen per unit to partly fund acquisition of new specific assets and repay debts.

35
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III. Asset Management Report(4) Cash Distributions
With regard to the cash distributions, JPR decided to distribute part of the retained earnings brought forward that had been internallyreserved through the 25th 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) andin order to minimize the burden to unitholders incurred by accrual of corporate income tax, etc. As a result, the cash distribution perunit came to 6,351 yen for the 26th fiscal period.

Fiscal Period

Unappropriated Retained Earnings at End of Period(Thousands of yen unless otherwise indicated)

22nd Fiscal
Period23rd Fiscal
Period24th Fiscal
Period25th Fiscal
Period26th Fiscal
Period(Jul. 1, 2012 Dec. 31, 2012)(Jan. 1, 2013 Jun. 30, 2013)(Jul. 1, 2013 Dec. 30, 2013)(Jan. 1, 2014 Jun. 31, 2014)(Jul. 1, 2014 Dec. 31, 2014)

5,050,424

4,998,468

4,976,931

5,094,946

5,259,866

23,69922,893

21,981

21,196

20,291

Internal Reserves
Total Cash Distributions

5,026,725

4,975,575

4,954,950

5,073,750

5,239,575(Cash Distribution per Unit)(6,093 yen)

(6,031 yen)

(6,006 yen)

(6,150 yen)

(6,351 yen)

Total Cash Distributions from Net Income

5,026,725

4,975,575

4,954,950

5,073,750

5,239,575(Cash distribution from net income per unit)(6,093 yen)

(6,031 yen)

(6,006 yen)

(6,150 yen)

(6,351 yen)

－

－

－

－

－

(- yen)(- yen)(- yen)(- yen)(- yen)㻌㻌㻌Breakdown㻌

Repayment of Paid-in Capital(Repayment of paid-in capital per unit)(5) Future Management Policies and Vital Issues
As for the prospects of the Japanese economy, it is anticipated that private capital investment will increase in line with the recoveryof corporate performances, while the current drop in crude oil prices will presumably make a positive contribution domestically. With
the employment environment staying solid, consumer spending is also likely to grow again in a virtuous circle of the economy if
personal income continues to improve. On the other hand, disturbance in the overseas economies including the trends of emerging
and resource-rich countries will remain to be a cause for concern.
In the office property leasing market, the market situation in general is likely to show a further recovery amid continued improvementin the supply and demand condition, while polarization by property will keep progressing. In this regard, JPR believes it will be able
to fully enjoy the positive impact of the market recovery as it has focused on improving tenant satisfaction through proactive
implementation of value enhancement works and provision of elaborate management services. In addition, when conducting realestate transactions in the market where polarization of earnings by property is anticipated to further advance, it will become evenmore important to discern the growth potential of earnings of respective properties. Considering the situation in which cap rates are
decreasing in an environment where long-term interest rates are falling even further due to additional monetary easing, it is required
to firmly keep the attitude of vigorously selective investment for implementing real estate investment that assumes possession ofproperties over the medium to long term.
1) Acquisition of New Properties and Asset Replacement
JPR will continue to make investment focused on the Tokyo office properties, with an aim to improve the quality of its portfolio
and enhance its growth potential in the recovery cycle of the market. Real estate transactions are expanding, as a decrease inpurchase cap rate and expected cap rate levels has been observed in the transaction market along with the recovery in the officeproperty leasing market conditions, and we believe property supply to the transaction market will increase going forward. As forretail properties as well as office properties in regional cities, which allow us to expect higher yields than the Tokyo officeproperties, JPR will work to invest in strictly selected blue-chip properties that can keep stable revenues at a certain level in order
to complement the stability of earnings from the entire portfolio. JPR will strive to acquire new properties under reasonable terms
by negotiating prices based on detailed market studies and property due diligence in considering properties.
JPR will continue to make investment decisions after a proactive collection of information through such sources as sponsors of
the Asset Manager, accurately grasping market trends and carefully researching investment value, including the future potential ofcandidate properties.
Moreover, JPR will continue to investigate asset replacement, centering on properties that do not allow us to expect sustainablegrowth in the future or those that may be sold under favorable terms and conditions.

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Japan Prime Realty Investment Corporation

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,
encourage them to expand office spaces in the same buildings and renew contracts with upward revision of rents throughendeavors to enhance tenant 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 on the assumption of the leasing market showing a recovery trend, and accelerate
decision making- Conduct strategic value enhancement works with intent to improve property earnings and tenant satisfaction- Reinforce promotion of energy efficiency as well as responses to business continuity plans and environmental friendliness thatcommand high social request- Conduct renovations to enhance energy-saving performance of the properties by utilizing the government’s subsidy programs(6) Fund Procurement
JPR's fundamental policy for fund procurement calls for an efficient combination of long-term steady fund procurement andshort-term fund procurement that emphasizes dynamism. In line with this policy, JPR will procure funds through unsecured andunguaranteed bank borrowings as well as the issuance of investment corporation bonds. JPR will continue to focus on thediversification of fund procurement means and consistently strive to diversify maturities.

(7) Information Disclosure
JPR has positioned the proactive voluntary disclosure of information as one of its key management policies and will voluntarily
disclose information believed to be essential to investment decisions concerning JPR, along with the timely disclosure of items to theTokyo Stock Exchange. JPR is proactively employing its website (http://www.jpr-reit.co.jp/jpr_e/) as well as its specified website forretail investors (http://www.jpr-reit.co.jp/kojin/index.html (Japanese only)) as a vital means for implementing voluntary disclosure,and JPR has promptly disclosed performance information and has provided videos on its primary properties using this site. We arecommitted to further enriching our information disclosure activities.

(8) Significant Subsequent Events
No relevant items.

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III. Asset Management Report

2. Overview of the Investment Corporation(1) Unitholders’ Capital
22nd Fiscal
Period as ofDecember 31, 2012
5,000,000

23rd Fiscal Period
as ofJune 30, 2013
5,000,000

24th Fiscal
Period as ofDecember 31, 2013
5,000,000

25th Fiscal
Period as of June30, 2014
5,000,000

26th Fiscal
Period as ofDecember 31, 2014
5,000,000

Total number of units issued andoutstanding

825,000

825,000

825,000

825,000

825,000

Unitholders' capital (millions ofyen)

192,044

192,044

192,044

192,044

192,044

Total number of unitholders

14,525

13,965

12,877

12,425

11,836

Total number of authorized units(2) Matters Related to Investment Units (Primary Investors)
The following table shows the 10 largest investors according to the percentage of their owned investment units to the total number ofunits outstanding as of the end of the 26th fiscal period.
Name

Address

Number ofPercentage of Total

Owned Units
180,845

Units Outstanding (%)
21.92

Japan Trustee Services Bank, Ltd. (Trust Account)

1-8-11 Harumi, Chuo-ku, Tokyo

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

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

61,582

7.46

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

Harumi Island Triton Square Office Tower Z
Building, 1-8-12 Harumi, Chuo-ku, Tokyo

49,105

5.95

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

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

31,777

3.85

Tokyo Tatemono Co., Ltd.

1-9-9 Yaesu, Chuo-ku, Tokyo

29,300

3.55

Kawasaki Gakuen

577 Matsushima, Kurashiki-shi, Okayama

25,000

3.03

Meiji Yasuda Life Insurance Company

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

24,0002.90

State Street Bank West Client Treaty (Standing Proxy:
Settlement & Clearing Services Division, Mizuho Bank, Ltd.)

1776 Heritage Drive, North Quincy, MA 02171
U.S.A.
(4-16-13 Tsukishima, Chuo-ku, Tokyo)

15,129

1.83

State Street Bank and Trust Company 505223 (Standing
Proxy: Settlement & Clearing Services Division, Mizuho
Bank, Ltd.)P. O. Box 351 Boston Massachusetts 02101 U.
S. A.
(4-16-13 Tsukishima, Chuo-ku, Tokyo)

12,998

1.57

State Street Bank West Pension Fund Clients Exempt(Standing Proxy: Settlement & Clearing Services Division,
Mizuho Bank, Ltd.)

1776 Heritage Drive, North Quincy, MA 02171
U. S. A.
(4-16-13 Tsukishima, Chuo-ku, Tokyo)

11,812

1.43

441,548

53.52

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

(3) Items Related to Directors
A. The Executive Officer, Supervising Officers and Independent Auditors as of the end of the 26th fiscal period are as follows.
Position
Executive Officer
Supervising
Officers (Note 1)
Independent
Auditor (Note 2)

Name

Other Current Assignments

Hirohito Kaneko

Representative Counsel, Hirohito Kaneko Law Office

Sosuke Yasuda

Advisor, Gyosei Audit Corporation
Group representative partner, GYOSEI Certified
Public Tax & Accountants’ Co.
Outside Auditor, MS&AD Insurance Group Holdings

Masato Denawa

Partner Attorney, Spring Partners

Ernst & Young
ShinNihon LLC－

Total Directors' Fee
during the 26th Fiscal
Period (thousands of yen)
2,400

4,200

Numberof Owned
Units
－

－

－
19,400－(Note 1) 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 2) 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.

38
40

Japan 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.

(4) Asset Manager, Asset Custodian and Administrative Agent
The asset manager, asset custodian and administrative agents of JPR at the end of the 26th fiscal period are as follows.
Outsourcing Category
Asset management company

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.

39
41

III. Asset Management Report

3. Status of JPR’s Assets Under Management(1) JPR’s Asset Structure
Asset TypeReal estate

Real estate in trust

25th Fiscal Period(as of June 30, 2014)

Area

26th Fiscal Period(as of December 31, 2014)

Central Tokyo

Assets owned by JPR(thousands of yen)
79,506,311

Percentage of total
assets (%)
19.2

Assets owned by JPR(thousands of yen)
79,435,093

Percentage of total
assets (%)
19.2

Greater Tokyo

61,416,499

14.8

58,865,744

14.2

Other Cities

21,724,252

5.2

21,546,427

5.2

Central Tokyo

132,687,363

32.0

133,519,662

32.2

Greater Tokyo

50,751,325

12.3

52,555,983

12.7

Other Cities

43,915,711

10.6

43,801,624

10.6

㻌 24,103,193(－)
414,104,657(390,001,463)

5.8
(－)
100.0
㻌 㻌 㻌 (94.2)

24,367,034(－)
414,091,570（389,724,535）

5.9
(－)
100.0
   (94.1)

Deposits and otherassets－Total assets－(Note 1) Assets owned by JPR are based on the amounts appropriated on the balance sheet as of the end of the fiscal periods (book values after depreciation for real estate
and real estate in trust).
(Note 2) Figures in parenthesis are portions that practically fall on real estate owned in the object assets.

(2) Major Assets Owned by JPR
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 endof the 26th fiscal period.

Property Name
Otemachi Tower (Land with
Leasehold Interest)

Book Value(thousands ofyen)

Leasable Floor
Space (m2)

Leased Floor
Space (m2)Occupancy Rate(%)

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

100.0

11.9

Asset Class38,388,259

11,034.78

11,034.78

Olinas Tower

28,837,076

23,987.40

22,941.07

95.6

7.1

OfficeShinjuku Center Bldg.

22,165,082

8,863.98

8,489. 82

95.8

3.4

OfficeBYGS Shinjuku Bldg.

15,618,751

15,216.93

15,134.94

99.5

3.8

OfficeJPR Sendagaya Bldg.

15,100,589

6,177.74

6,177.74

100.0

2.1

OfficeKanematsu Bldg.

14,683,598

8,011.75

7,208.37

90.0

2.4

OfficeKawasaki Dice Bldg.

14,057,508

12,116.35

11,579.18

95.6

2.9

RetailJPR Umeda Loft Bldg.

12,459,775

18,586.97

18,586.97

100.0

2.8

RetailJPR Shibuya Tower Records
Bldg.

11,583,167

8,076.85

8,076.85

100.0

2.5

RetailOfficeMS Shibaura Bldg.
Total

11,126,221

14,468.38

10,546.98

72.9

2.1

184,020,031

126,541.13

119,776.70

94.7

40.9

Office(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. and Kawasaki Dice Bldg. 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, the leasable floor space, leased floor space and occupancy rate enteredfor each of these buildings are the figures concerning the sub-lessee of the tenant.

40
42Japan Prime Realty Investment Corporation(3) Itemized Portfolio Assets
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 26th fiscal period (December 31, 2014).

Area Type

Property Name

14,683,598(Note)
12,100,000

Kanematsu Bldg. Annex

17-5 Kyobashi 2-chome, Chuo-ku, Tokyo
17-4 Nihonbashi Ningyocho 1-chome,
Chuo-ku, Tokyo
3-3 Kojimachi 4-chome, Chiyoda-ku, Tokyo
21-4, etc., Kanda-Nishikicho 3-chome,
Chiyoda-ku, Tokyo
13-23 Shibaura 4-chome, Minato-ku, Tokyo
8-1 Nishi-Gotanda 2-chome, Shinagawa-ku,
Tokyo
8-7 Yaesu 2-chome, Chuo-ku, Tokyo
7-15 Kudan-Minami 4-chome, Chiyoda-ku,
Tokyo
17-1 Higashi-Gotanda 2-chome,
Shinagawa-ku, Tokyo

Beneficiary interest

2,423,266

2,240,000

Beneficiary interest

1,959,327

2,340,000

Beneficiary interest

2,437,925

2,940,000

Beneficiary interest

3,344,998

2,840,000

Beneficiary interest

11,126,221

11,000,000

Beneficiary interest

2,654,223

2,020,000

Beneficiary interest

3,013,776

2,860,000

Beneficiary interest

5,253,301

4,700,000

Beneficiary interest

2,995,706

4,540,000

Beneficiary interest

8,683,700

Real estate

176,245

19-1 Shinjuku 2-chome, Shinjuku-ku, Tokyo

Real estate

15,618,751

13,900,000

Real estate

609,301

825,000

Real estate

22,165,082

13,100,000

Real estate

3,897,366

2,500,000

Shinagawa Canal Bldg.

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

Real estate

1,782,289

1,770,000

Rokubancho Bldg.

2-9, etc., Rokubancho, Chiyoda-ku, Tokyo

Real estate

2,872,159

3,200,000

JPR Harajuku Bldg.

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

Beneficiary interest

8,746,317

7,330,000

Tokyo Tatemono Kyobashi Bldg.

Real estate

5,352,375

5,560,000

Beneficiary interest

4,963,583

6,160,000

JPR Sendagaya Bldg.

6-18 Kyobashi 3-chome, Chuo-ku, Tokyo
11-12 Nihonbashi-Horidomecho 1-chome,
Chuo-ku, Tokyo
23-5 Sendagaya 4-chome, Shibuya-ku, Tokyo

Real estate

15,100,589

11,100,000

Ginza Sanwa Bldg.
Otemachi Tower (Land with Leasehold
Interest)
Science Plaza-Yonbancho Plaza

6-1 Ginza 4-chome, Chuo-ku, Tokyo
6-6, etc., Otemachi 1-chome, Chiyoda-ku,
Tokyo
9-6, etc., Yonbancho, Chiyoda-ku, Tokyo

Real estate

3,634,492

3,450,000

Beneficiary interest

38,388,259

39,800,000

Beneficiary interest

2,690,094

2,930,000

Shibadaimon Center Bldg.

1-10-11 Shibadaimon, Minato-ku, Tokyo

Beneficiary interest

4,246,999

4,840,000

JPR Shibuya Tower Records Bldg.

22-14 Jinnan 1-chome, Shibuya-ku, Tokyo

Beneficiary interest

11,583,167

13,200,000

JPR Daikanyama

20-5 Daikanyamacho, Shibuya-ku, Tokyo

Real estate

2,189,551

1,540,000

JPR Jingumae 432

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

Beneficiary interest

4,325,194

3,600,000

Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
Arca East

1-25, Shinjuku 3-chome, Shinjuku-ku, Tokyo

Real estate

2,684,251

2,620,000

MS Shibaura Bldg.
Gotanda First Bldg.
Fukuoka Bldg.
JPR Ichigaya Bldg.

OfficeOval Court Ohsaki Mark West
Shinjuku Square Tower
Shinjuku Square Tower(additional acquisition in 14th period)
BYGS Shinjuku Bldg.
Across Shinkawa Bldg. Annex
Shinjuku Center Bldg.
Minami Azabu Bldg.

RetailJPR Nihonbashi-horidome Bldg.

22-1 Nishi-Shinjuku 6-chome, Shinjuku-ku,Tokyo

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

7,492,000

Real estate

3,352,636

2,860,000

2-1 Kinshi 3-chome, Sumida-ku, Tokyo

Beneficiary interest

4,454,074

6,220,000

Beneficiary interest

2,330,486

1,690,000

Beneficiary interest

2,588,606

2,380,000

Beneficiary interest

1,468,784

1,620,000

Kawaguchi Center Bldg.

1-7, etc., Shinmachi, Chuo-ku, Chiba, Chiba
17 Nihon-Odori, Naka-ku, Yokohama,
Kanagawa
19-5, etc., Shinyokohama 3-chome,
Kohoku-ku, Yokohama, Kanagawa
1-8 Honcho 4-chome, Kawaguchi, Saitama

Beneficiary interest

7,086,064

7,390,000

JPR Ueno East Bldg.

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

Real estate

3,046,276

4,320,000

Tachikawa Business Center Bldg.

2,938,558

3,030,000

5,449,359

6,990,000

5,634,495

5,700,000

28,837,076

33,800,000

6,925,517

7,280,000

Tanashi ASTA

38-5 Akebonocho 2-chome, Tachikawa, Tokyo
Real estate
5-2 Higashi-Ikebukuro 4-chome, Toshima-ku,
Real estateTokyo
6-1 Kamiooka Nishi 1-chome, Konan-ku,
Real estate
Yokohama, Kanagawa
1-3 Taihei 4-chome, Sumida-ku, Tokyo
Real estate
5-10 Kitasaiwai 1-chome, Nishi-ku,
Real estate
Yokohama, Kanagawa
1-1, etc., Shimocho 2-chome, Omiya-ku,
Beneficiary interest
Saitama, Saitama
1-1 Tanashicho 2-chome, Nishitokyo, Tokyo
Beneficiary interest

Cupo-la Main Bldg.

1-1 Kawaguchi 1-chome, Kawaguchi, Saitama

JPR Chiba Bldg.
JPR Yokohama Nihon Odori Bldg.
Shinyokohama 2nd Center Bldg.

Office(thousands of yen)

Beneficiary interest

JPR Crest Takebashi Bldg.

Rise Arena Bldg.
Yume-ooka Office Tower
Olinas Tower
Tokyo Tatemono Yokohama Bldg.
Omiya Prime East

Retail(thousands of yen)

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

Shin-Kojimachi Bldg.

Central Tokyo

Form ofOwnership

Appraisal Valueas of December
31, 2014

Kanematsu Bldg.
JPR Ningyo-cho Bldg.

Greater Tokyo

LocationBook Valueas of December
31, 2014

Real estate

6,137,326

6,590,000

7,576,156

12,900,000

1,819,337

2,620,000

41
43

III. Asset Management Report

Property Name

JPR Musashikosugi Bldg.
RetailGreaterTokyo

Area TypeMusashiurawa Shopping Square
Kawasaki Dice Bldg.
Niigata Ekinan Center Bldg.
Tokyo Tatemono Honmachi Bldg.
JPR Hakata Bldg.
JPR Naha Bldg.

Other Cities

OfficeSompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.
JPR Dojima Bldg.
JPR Hakata-chuo Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden

RetailJPR Umeda Loft Bldg.
Benetton Shinsaibashi Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.
Total

Form ofOwnership

Location
420-1,etc., Kosugimachi 3-chome,
Nakahara-ku, Kawasaki, Kanagawa
3-1 Bessho 7-come, Saitama, Saitama
8-3, etc., Ekimae-Honcho, Kawasaki,
Kanagawa
24 Yoneyama 1-chome, Chuo-ku, Niigata,
Niigata
4-8 Honmachi 3-chome, Chuo-ku, Osaka,Osaka
4-4 Hakataeki-mae 1-chome, Hakata-ku,
Fukuoka, Fukuoka
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
6-12 Hakataeki-mae 2-chome, Hakata-ku,
Fukuoka, Fukuoka
24-15 Sakae 1-chome, Naka-ku, Nagoya, Aichi
1-1 Yakuin 1-chome, Chuo-ku, Fukuoka,
Fukuoka
16-7 Chayamachi, Kita-ku, Osaka, Osaka
2-11 Minami-Senba 4-chome, Chuo-ku, Osaka,Osaka
2-2 Higashi-Kawasakicho 1-chome, Chuo-ku,
Kobe, Hyogo
2-19 Chayamachi, Kita-ku, Osaka, Osaka

Book Valueas of December
31, 2014(thousands of yen)Appraisal Valueas of December
31, 2014(thousands of yen)

(Note)

Real estate

7,153,682

5,410,000

Beneficiary interest

3,918,414

4,100,000

Beneficiary interest

14,057,508

15,000,000

Beneficiary interest

1,727,215

2,300,000

Beneficiary interest

4,146,323

3,250,000

Beneficiary interest

3,079,654

2,700,000

Beneficiary interest

1,379,400

1,350,000

Beneficiary interest

2,253,139

3,400,000

Beneficiary interest

1,422,959

1,600,000

Beneficiary interest

2,196,200

2,180,000

Beneficiary interest

2,171,722

2,160,000

Beneficiary interest

1,842,929

1,680,000

Real estate

4,051,110

2,880,000

Real estate

11,044,154

12,000,000

Beneficiary interest

12,459,775

13,700,000

Beneficiary interest

5,144,673

4,450,000

Real estate

6,451,162

6,660,000

Beneficiary interest

5,977,629

4,990,000

389,724,535

387,697,000(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.”

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

Area Type

Property Name

Kanematsu Bldg.

4244

OfficeCentral Tokyo

Kanematsu Bldg. Annex

25th Fiscal Period
26th Fiscal Period(from Jan. 1, 2014 to Jun. 30, 2014)(from Jul. 1, 2014 to Dec. 31, 2014)
RentalRentalNumberRatio to Number Occupancy
Ratio toOccupancy Revenues
Revenues
of
Total
of
Rate at
Total
Rate atthroughout
throughout
Tenants
RentalTenants
PeriodRentalPeriod End
PeriodPeriodat Period
Revenues at PeriodEnd
Revenues(%)(thousands(thousands
End
(%)
End
(%)
(%)
of yen)of yen)9
100.0
353,3492.6
8
90.0
329,7622.4
1100.0(Note 2) (Note 2)1
100.0(Note 2) (Note 2)

JPR Ningyo-cho Bldg.

4

100.0

88,117

0.6

4

100.0

89,153

0.6

Shin-Kojimachi Bldg.

14

91.7

100,233

0.7

15

94.2

96,9890.7

JPR Crest Takebashi Bldg.

6

100.0

55,956

0.4

6

100.0

93,053

0.7

MS Shibaura Bldg.

8

100.0

410,238

3.0

7

72.9

Gotanda First Bldg.
Fukuoka Bldg.
JPR Ichigaya Bldg.

2
1
10

100.0
100.0
100.0

131,533(Note 2)
156,332

1.0(Note 2)
1.1

2
1
9

100.0
100.0
88.2

330,889
133,085(Note 2)
161,7862.4
1.0(Note 2)
1.2

Oval Court Ohsaki Mark West

3

100.0

179,886

1.3

3

100.0

180,777

1.3

97.4

193,278

1.4

93.9

194,868

1.4

97.4

2,969

0.0

93.9

2,994

0.0

Shinjuku Square Tower
Shinjuku Square Tower(additional acquisition in 14th period)
BYGS Shinjuku Bldg.

25

24

25

98.8

513,661

3.7

25

99.5

549,039

3.9

Across Shinkawa Bldg. Annex

4

100.0

32,665

0.2

4

100.0

35,7390.3

Shinjuku Center Bldg.
Minami Azabu Bldg.
Shinagawa Canal Bldg.
Rokubancho Bldg.
JPR Harajuku Bldg.

30
1
5
1
9

94.9
100.0
100.0
100.0
100.0

456,379(Note 2)
62,033(Note 2)
223,848

3.3(Note 2)0.5
(Note 2)
1.6

32
1
4
1
9

95.8
100.0
85.2
100.0
100.0

455,631(Note 2)64,888(Note 2)299,693

3.3(Note 2)0.5
(Note 2)
1.7

Tokyo Tatemono Kyobashi Bldg.

5

56.9

106,549

0.8

7

78.8

140,787

1.0

JPR Nihonbashi-horidome Bldg.

6

100.0

185,901

1.4

6

100.0

191,390

1.4

Japan Prime Realty Investment Corporation

Area Type

Property Name

OfficeOfficeOfficeRetailOther Cities

RetailGreater Tokyo

RetailCentral Tokyo

JPR Sendagaya Bldg.
Ginza Sanwa Bldg.
Otemachi Tower (Land with Leasehold
Interest)
Science Plaza-Yonbancho Plaza
Shibadaimon Center Bldg.
JPR Shibuya Tower Records Bldg.
JPR Daikanyama

25th Fiscal Period
26th Fiscal Period(from Jan. 1, 2014 to Jun. 30, 2014)(from Jul. 1, 2014 to Dec. 31, 2014)
RentalRentalNumberRatio to Number Occupancy
Ratio toOccupancy Revenues
Revenues
of
Total
of
Rate at
Total
Rate atthroughout
throughout
Tenants
RentalTenants
PeriodRentalPeriod End
PeriodPeriodat Period
Revenues at PeriodEnd
Revenues(%)(thousands(thousands
End
(%)
End
(%)
(%)
of yen)of yen)6
100.0
232,5311.7
6
100.0
268,966
1.9
8

100.0

116,800

0.9

8

100.0

115,471

0.8

2

100.0

1,499,750

24

96.6

117,464

10.9

2

100.0

1,530,000

11.0

0.9

19

86.4

113,608

7
1
4

100.0
100.0
100.0

0.8

135,801(Note 2)33,7591.0(Note 2)
0.2

9
1
4

100.0
100.0
100.0

162,510(Note 2)34,0161.2(Note 2)
0.2

JPR Jingumae 432
Shinjuku Sanchome East Bldg.
Yurakucho Ekimae Bldg.
(Yurakucho Itocia)
Arca East

5
1

63.7
100.0

56,691(Note 2)0.4
(Note 2)

6
1

86.6
100.0

49,736(Note 2)0.4
(Note 2)1100.0(Note 2)

(Note 2)1100.0(Note 2)

(Note 2)

JPR Chiba Bldg.

5

93.1

253,455

1.8

5

93.1

258,436

1.9

37

97.2

130,961

1.0

37

95.6

132,504

JPR Yokohama Nihon Odori Bldg.

1.0

13

100.0

130,085

0.9

13

100.0

130,945

0.9

Shinyokohama 2nd Center Bldg.

16

91.4

95,311

0.7

19

96.9

96,146

0.7

Kawaguchi Center Bldg.

44

96.8

385,080

2.8

43

96.7

395,026

2.8

JPR Ueno East Bldg.

8

100.0

178,099

1.3

8

100.0

181,247

1.3

100.0

53,7590.4

100.0

90,789

0.7

19

98.1

150,000

1.1

100.0
91.2

(Note 2)
321,427(Note 2)
2.3

1
35

100.0
91.2

(Note 2)
315,797(Note 2)
2.3

Tachikawa Business Center Bldg.
Tachikawa Business Center Bldg.
(additional acquisition in 11th period)
Rise Arena Bldg.
Yume-ooka Office Tower

19
1
35

Olinas Tower

10

94.2

1,013,414

7.4

11

95.6

997,732

7.2

Tokyo Tatemono Yokohama Bldg.

14

100.0

303,798

2.2

14

100.0

295,254

2.1

Omiya Prime East
Tanashi ASTA
Cupo-la Main Bldg.
JPR Musashikosugi Bldg.
Musashiurawa Shopping Square

4
1
1
1
3

100.0
100.0
100.0
100.0
100.0

265,914(Note 2)
(Note 2)
(Note 2)
128,573

1.9(Note 2)
(Note 2)
(Note 2)
0.9

4
1
1
1
3

100.0
100.0
100.0
100.0
100.0

264,917(Note 2)
(Note 2)
(Note 2)
126,9961.9(Note 2)
(Note 2)
(Note 2)
0.9

Kawasaki Dice Bldg.

28

97.5

485,210

3.5

27

95.6

483,257

3.5

Niigata Ekinan Center Bldg.

8

100.0

128,193

0.9

8

100.0

128,324

0.9

Tokyo Tatemono Honmachi Bldg.

10

94.0

155,692

1.1

10

94.0

155,840

1.1

JPR Hakata Bldg.

37

85.3

109,828

0.8

40

96.7

129,347

0.9

JPR Naha Bldg.

22

100.0

85,957

0.6

22

100.0

91,601

0.7

Sompo Japan Sendai Bldg.

13

95.3

179,545

1.3

13

95.3

180,099

1.3

Sompo Japan Wakayama Bldg.

12

98.3

111,354

0.8

12

98.3

112,364

0.8

Tenjin 121 Bldg.

16

100.0

97,916

0.7

16

100.0

99,194

0.7

JPR Dojima Bldg.

8

100.0

112,408

0.8

8

100.0

114,4230.8

JPR Hakata-chuo Bldg.

6

100.0

75,059

0.5

6

100.0

78,5200.6

JPR Nagoya Fushimi Bldg.

3

89.7

130,268

0.9

3

88.8

131,144

0.9

Yakuin Business Garden
JPR Umeda Loft Bldg.
Benetton Shinsaibashi Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.

16
1
1
1
6

98.7
100.0
100.0
100.0
100.0

437,778(Note 2)
(Note 2)
(Note 2)
138,447

3.2(Note 2)
(Note 2)
(Note 2)
1.0

17
1
1
1
6

99.9
100.0
100.0
100.0
100.0

437,735(Note 2)
(Note 2)
(Note 2)
141,162

3.1(Note 2)
(Note 2)
(Note 2)
1.0

Total

628

97.8

13,734,191

100.0

632

97.0

13,902,843

100.0(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
Plaza-Yonbancho Plaza, Rise Arena Bldg. and Kawasaki Dice Bldg.: when a single tenant leases 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, Rise Arena Bldg. and Kawasaki Dice
Bldg. have sublet space to sublessees and lease agreements have been executed where the rent paid by the tenants fluctuates in accordance with the leaseconditions of the sublessees and thus the numbers of sublessees have been entered as the numbers of tenants.
(Note 2) JPR does not disclose the rental revenues of the properties throughout the period and their ratio to total rental revenues due to inevitable reasons.

(4) Status of Other Assets
Beneficiary interests with real estate as major entrusted properties have been entered under (3) Itemized Portfolio Assets above.
There is no incorporation of main specific assets which are main investment targets of JPR other than those listed under (3) above asof the end of the 26th fiscal period.

43
45

III. Asset Management Report

4. Capital Expenditures of Owned Real Estate(1) Planned Capital Expenditures
The following are major items of capital expenditures for currently planned renovations, etc. for JPR-owned real estate and entrusted
real estate regarding beneficiary interests in real estate. Furthermore, the planned construction expenses include portions that areclassified as expenses in accounting.
Planned (millions of yen)
Total
Value

Payment
duringthe 26th
Fiscal Period

AmountAlready
Paid

Oct. 2014 ~ Mar. 2015

171

－

－

2nd phase of replacement of air
conditioning units

Jan. 2015 ~ Jun. 2015

103

－

－

Chuo Ward, Tokyo

1st phase of renewal of through-the-wall
air conditioning units

Jan. 2015 ~ Jun. 2015

65

－

－

Shinjuku Center
Bldg.

Shinjuku Ward,Tokyo

4th phase of replacement of substation
facilities

Jan. 2015 ~ Mar. 2015

48

－

－

JPR Ichigaya Bldg.

Chiyoda Ward,Tokyo

Replacement of security systems

Jan. 2015 ~ Apr. 2015

46

－

－

Property Name

Location

PurposeSchedule

JPR Umeda Loft
Bldg.

Osaka City, Osaka

Renewal of heat sources for air
conditioning units

Shin-Kojimachi
Bldg.

Chiyoda Ward,Tokyo

Kanematsu Bldg.

(2) Capital Expenditures during the 26th Fiscal Period
The following are the capital expenditure amounts JPR invested in real estate and entrusted real estate during the 26th 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 and installation of office automation floors for leased offices with the aim of attracting
new tenants. In addition, aside from these constructions, JPR conducted construction of 455 million yen (Note), which wasappropriated as expenditures for repair and maintenance.
Property Name

Location

Purpose

PeriodConstruction
Expenses(millions of yen)

MS Shibaura Bldg.

Minato Ward, Tokyo

Replacement of air
conditioning equipment on
the 5th and 7th floors

Jul. 2014 ~ Sep. 2014

168

Sompo Japan Wakayama
Bldg.

Wakayama City, Wakayama

2nd phase of replacement of
air conditioning units

Jul. 2014 ~ Dec. 201473

Shin-Kojimachi Bldg.

Chiyoda Ward, Tokyo

1st phase of replacement of
air conditioning units

Oct. 2014 ~ Dec. 2014

53

Fukuoka Bldg.

Chuo Ward, Tokyo

5th phase of replacement of
air conditioning units

Jul. 2014 ~ Sep. 201444

MS Shibaura Bldg.

Minato Ward, Tokyo

Installation of officeautomation floors and carpet
tilesJul. 2014 ~ Aug. 2014

38

Repair of common areas, installation of office automation
floors, replacement of air conditioning units, etc.

327

Other Properties

Total

706

(Note) Expenditures for repair and maintenance included 10 million yen of construction management fees paid to construction management companies as well as theamounts for repair and maintenance constructions themselves.

44
46

Japan Prime Realty Investment Corporation(3) Amounts Reserved for Long-Term Repairs and Maintenance Plans
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 andmaintenance plans for individual properties.
Operation Period
Balance of deposits at
beginning of current
period22nd Fiscal Period(Jul. 1, 2012 Dec. 31, 2012)

23rd Fiscal Period(Jan. 1, 2013 Jun. 30, 2013)

24th Fiscal Period(Jul. 1, 2013 Dec. 31, 2013)(Millions of yen)

25th Fiscal Period(Jan. 1, 2014 Jun. 30, 2014)

26th Fiscal Period(Jul. 1, 2014 Dec. 31, 2014)

799

810

816

805

925

Deposits during theperiod

376

376

565

591

378

Amounts used from
deposits during the period

365

370

576

471

426

Deposits carried forward
to the next period

810

816

805

925

877

45
47

III. Asset Management Report

5. Expenses and Liabilities(1) Details of Expenses Related to Management
25th Fiscal Period(Jan. 1, 2014 - Jun. 30, 2014)

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

478,665

26th Fiscal Period(Jul. 1, 2014 - Dec. 31, 2014)

485,787

Fixed compensation

75,00075,000

Incentive-based compensation 1

246,707248,702

Incentive-based compensation 2

156,957

162,084(b) Administrative Service and Custodian Fees

79,48778,417(c) Directors' Fee

6,600

6,600

(d) Trust Fees

35,67432,150(e) Other Expenses
Total

108,81189,007709,239

691,962(Note) Aside from the amounts of the asset management fees entered above, a total of 2,000 thousand yen for the 26th fiscal period has been paid for asset management of
the acquired properties and has been included in the book value of each property.

(2) Status of Loans Payable
As of December 31, 2014 JPR has the following loans payable.

46
48

LenderLoans

PayableThe Norinchukin Bank
The Hachijuni Bank, Ltd.
Total

Long-Term Loans Payable

Short-Term

Category

Drawdown
Date

Balance as ofJul. 1, 2014
(millions ofyen)

Dec. 5, 2013

1,000

Sep. 24, 2013

Feb. 4, 2011
Mar. 30, 2012
Mizuho Bank, Ltd.
Dec. 5, 2012
Nov. 27, 2013
Jun. 27, 2014
Mar. 25, 2011
Aug. 8, 2012
Aug. 8, 2012
Bank of Tokyo-Mitsubishi
Sep. 5, 2012
UFJ, Ltd.
Dec. 5, 2012
Nov. 27, 2013
Jun. 27, 2014
Mar. 30, 2012
Sumitomo Mitsui Banking Dec. 5, 2012
Corporation
Jun. 27, 2013
Jun. 27, 2014
Jul. 3, 2012
Aug. 8, 2012
Aozora Bank, Ltd.
Aug. 27, 2012
Aug. 30, 2012
Sep. 30, 2013
Apr. 5, 2012
Shinsei Bank, Ltd.
Sep. 24, 2013
Dec. 5, 2014
Mar. 30, 2012
Mizuho Trust & Banking
Co., Ltd.
Feb. 4, 2013
Aug. 29, 2011
Mitsubishi UFJ Trust andAug. 29, 2011
Banking Corporation
Jun. 27, 2012
Jun. 26, 2009
Development Bank ofJun. 27, 2013
Japan Inc.
Dec. 5, 2013
Jul. 7, 2011
The Bank of Fukuoka, Ltd. Apr. 11, 2012
Sep. 24, 2013
Apr. 11, 2012
Sompo Japan Nipponkoa
Insurance Inc. (Note 10)
Jun. 27, 2012
Meiji Yasuda Life
Jun. 21, 2011
Insurance Company

Balance as of
AverageDec. 31,
Interest Rate(%)
2014
(Note 1)(millions of(Note 2)
yen)
－

0.395

Repayment
Date

Repayment
MethodUse

Remarks

Dec. 5, 2014

Principal
lump sum
repayment
on maturity(Note 3)

Unguaranteed/

0.460 Sep. 24, 2014

1,000

－

2,000
5,000
7,000
2,000
3,000
5,000
5,000
1,000
1,000
3,000
1,000
3,000
4,000
6,400
1,000
3,000
2,500
900
2,000
2,000
2,000
1,000
5,000
2,000
－
4,000
3,000
5,000
1,000
1,000
3,000
820
2,000
2,000
2,000
1,000
2,000
2,000

－
5,000
7,000
2,000
3,000
5,000
5,000
1,000
1,000
3,000
1,000
3,000
4,000
6,400
1,000
3,000
2,500
900
2,000
2,000
2,000
1,000
5,000
2,000
2,000
4,000
3,000
5,000
1,000
1,000
2,900
820
2,000
2,000
2,000
1,000
2,000
2,000

1.414
1.093
1.027
0.970
1.178
1.198
1.178
0.948
0.919
1.027
0.970
0.889
1.093
1.027
1.265
1.033
0.994
1.178
0.985
1.146
1.069
1.397
1.076
1.134
1.093
1.076
1.184
0.924
0.843
3.190
1.449
1.188
1.170
0.902
0.911
0.981
0.874

3,670

3,604

1.800 Jun. 21, 2018

Feb. 4, 2016
Mar. 30, 2017
Dec. 5, 2019Nov. 27, 2020
Jun. 27, 2023
Mar. 25, 2016
Aug. 8, 2019
Aug. 8, 2017
Sep. 5, 2017
Dec. 5, 2019Nov. 27, 2020
Jun. 25, 2021
Mar. 30, 2017
Dec. 5, 2019
Jun. 26, 2020
Jun. 27, 2022
Jul. 3, 2017
Aug. 8, 2019
Aug. 25, 2017
Aug. 30, 2018
Sep. 24, 2020
Apr. 5, 2019
Sep. 24, 2020
Dec. 5, 2024
Mar. 30, 2017
Feb. 4, 2020
Aug. 29, 2017
Aug. 31, 2015
Jun. 26, 2015
Jun. 27, 2019
Jun. 25, 2021
Dec. 3, 2021
Jul. 7, 2016
Oct. 9, 2015
Sep. 24, 2019
Oct. 11, 2016
Dec. 25, 2015

Unsecured/
Non-SubordinatedPrincipal
lump sum
repayment
on maturity
Principal
lump sum
repayment
on maturity

Principal
lump sum (Note 3)
repayment
on maturity(Note 4)
Principal
lump sum
repayment
on maturity(Note 5)

Unsecured/
Unguaranteed/
Non-SubordinatedJapan Prime Realty Investment Corporation

Category

Lender

ORIX Bank Corporation
Shinkin Central BankThe Shinkumi Federation
Bank
Taiyo Life Insurance
CompanyLong-Term Loans Payable

The Chugoku Bank, Ltd.
The Nishi-Nippon City
Bank, Ltd.
Sumitomo Life Insurance
Company
Zenkyoren (National
Mutual Insurance
Federation of Agricultural
Cooperatives)
Daido Life Insurance
Company
The Hachijuni Bank, Ltd.
Resona Bank, Limited
The Iyo Bank, Ltd.
Tokio Marine & Nichido
Fire Insurance Co., Ltd.
The Tokyo Tomin Bank,
Limited (Note 6)
The Norinchukin Bank
The Bank of Yokohama,Ltd. (Note 6)
The Minato Bank, Ltd.
(Note 6)
The Yamaguchi Bank, Ltd.
(Note 6)The Chiba Kogyo Bank,
Ltd. (Note 6)
Total

Feb. 4, 2013
Nov. 27, 2013
Dec. 5, 2013

Balance as of
AverageDec. 31,
Interest Rate
Repayment Repayment
(%)
2014
Date
Method(Note 1)(millions of
(Note
2)
yen)
1,000
1,000
0.786 Feb. 5, 2018
2,000
2,000
0.762 May 27, 2019
3,000
3,000
0.689 Dec. 5, 2018

Drawdown
Date

Balance as ofJul. 1, 2014
(millions of
yen)

Use

Feb. 4, 2013

3,000

3,000

0.786

Sep. 24, 2010
Jun. 4, 2013
Dec. 27, 2013
Apr. 11, 2012
Sep. 24, 2013

1,000
1,000
1,000
2,000
1,000

1,000
1,000
1,000
2,000
1,000

1.275 Sep. 24, 2015
0.949 Jun. 4, 2018
1.011 Dec. 25, 2020
0.902 Oct. 9, 2015
0.758 Sep. 25, 2018

May 27, 2011

3,000

3,000

1.149 May 27, 2016

Jun. 4, 2008

2,000

2,000

2.257

Mar. 26, 2008

2,000

2,000

1.725 Mar. 26, 2015

Feb. 5, 2008
Dec. 27, 2013
Apr. 11, 2012
Sep. 24, 2014
Mar. 30, 2012
Apr. 11, 2012

1,000
1,000
1,000
－
2,000
1,000

1,000
1,000
1,000
1,000
2,000
1,000

Principal
lump sum
1.666 Feb. 5, 2015
(Note 3)0.710 Dec. 27, 2018 repaymentonmaturity
0.902 Oct. 9, 2015
0.424 Sep. 26, 2016
1.093 Mar. 30, 20170.902 Oct. 9, 2015

Dec. 27, 2013

1,000

1,000

0.710 Dec. 27, 2018

Mar. 30, 2012

1,000

1,000

0.626 Sep. 30, 2015

Dec. 5, 2014

－

1,000

0.440

Mar. 30, 2012

1,000

1,000

0.626 Sep. 30, 2015

Mar. 30, 2012

800

800

0.626 Sep. 30, 2015

Mar. 30, 2012

500

500

0.626 Sep. 30, 2015

Mar. 30, 2012

100

100

0.626 Sep. 30, 2015

132,690

136,524

Remarks

Feb. 5, 2018

Jun. 4, 2015

Unsecured/
Unguaranteed/
Non-SubordinatedDec. 5, 2017

(Note 1) The average interest rates are weighted-average figures during the 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, except those in a syndicated loan (Note 6).
(Note 3) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemptionof investment corporation bonds.
(Note 4) The loans payable are subject to repayment of 100 million yen on December 27, 2009 and thereafter on the 27th day of every 6 months. In addition, repayment of
2,100 million yen will be made on maturity date June 27, 2019.
(Note 5) The loans payable are subject to repayment of 66 million yen on June 27, 2012 and hereafter on the 27th day of every 6 months. In addition, repayment of 3,208
million yen will be made on maturity date June 21, 2018.
(Note 6) The loans are with floating interest rates.

47
49

III. Asset Management Report(3) Investment Corporation Bonds
Details of JPR’s investment corporation bonds outstanding as of December 31, 2014 are as follows.
Balance as of
Balance as of
CouponRate
Jul. 1, 2014
Dec. 31, 2014(%)
(millions of yen) (millions of yen)

Name

Issue Date

Maturity Date

Sixth Series ofInvestment
Corporation Bonds

Nov. 4, 2004

5,000

－

2.000

Nov. 4, 2014

Seventh Series ofInvestment
Corporation Bonds

Dec. 14, 2006

4,500

4,500

2.900

Dec. 14, 2026

Ninth Series ofInvestment
Corporation Bonds

Jul. 23, 2007

6,000

－

2.100

Jul. 23, 2014

Eleventh Series ofInvestment
Corporation Bonds

Mar. 12, 2010

6,000

6,000

1.680

Mar. 12, 2015

Twelfth Series ofInvestment
Corporation Bonds

May 21, 2010

7,000

7,000

1.270

May 21, 2015

Thirteenth Series ofInvestment
Corporation Bonds

Oct. 25, 2011

7,000

7,000

0.950

Oct. 25, 2016

Fourteenth Series ofInvestment
Corporation Bonds

Oct. 25, 2011

2,000

2,000

1.340

Oct. 25, 2018

Fifteenth Series ofInvestment Corporation
Bonds

Nov. 22, 2012

5,000

5,000

0.680

Nov. 22, 2017

Sixteenth Series ofInvestment Corporation
Bonds

Nov. 22, 2012

2,000

2,000

1.030

Nov. 22, 2019

Seventeenth Series ofInvestment Corporation
Bonds

May 31, 2013

5,000

5,000

0.650

May 31, 2018

Eighteenth Series ofInvestment Corporation
Bonds

May 31, 2013

2,000

2,000

1.460

May 31, 2023

Nineteenth Series ofInvestment Corporation
Bonds

Feb. 5, 2014

5,000

5,000

1.110

Feb. 5, 2024

Twentieth Series ofInvestment Corporation
Bonds

Jul. 22, 2014

－

2,000

0.303

Jul. 22, 2019

Twenty-first Series ofInvestment Corporation
Bonds

Jul. 22, 2014

－

4,000

1.278

Jul. 22, 2026

Twenty-second Series ofInvestment Corporation
Bonds

Dec. 4, 2014

－

3,000

0.831

Dec. 4, 2024

56,50054,500

Redemption
MethodUse

Remarks(Note 2)

Bulletrepayment(Note 1)
(Note 3)

Total

(Note 1) Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemptionof investment corporation bonds.
(Note 2) These investment corporation bonds are equipped with the same rank rider limited among investment corporation bonds and limitations on resale among
qualified institutional investors.
(Note 3) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.

(4) Subscription rights to shares
Not applicable48
50

Japan Prime Realty Investment Corporation

6. Acquisitions and Sales during the 26th Fiscal Period(1) Acquisition and Sale of Real Estate and Asset-Backed Securities, etc.
Type of
Asset

Real Estate
Name

Real estate

Shibadaimon(Note 2)Center Bldg.

Acquisition
AcquisitionPrice
Acquisition
(thousands
Dateof yen)(Note 1)

Sale
Sale Date

Sale Price(A)(Note 1)

Book Value(B)(thousandsof yen)Difference(C)(A) – (B)(thousandsof yen)Sale
Expense(D)(thousandsof yen)Sale Profit
and Loss(C) – (D)(thousandsof yen)Jul. 30, 2014

800,000

-

-

-

-

-

-

-

800,000

-

-

-

-

-

-

Total

(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) JPR already owns beneficiary interest in part of the property as trust property. JPR executed an additional trust agreement with the trustee as of July 30, 2014 forthe additionally acquired portion and added the portion to the said trust property, so that JPR currently owns trust beneficiary interest in the both portions.

(2) Acquisition and Sale of Other Assets
JPR made no acquisition or sale of other assets in the 26th fiscal period.

(3) Survey on Values of Specified Assets, etc.
Acquisition or
Sale

Type of Asset

Real Estate
Name

Real estate

Shibadaimon(Note 3)

Center Bldg.

Acquisition

Transaction
Date

Acquisition
Price or Sale
Price (Note 1)(thousands ofyen)Real EstateAppraisal
Value (Note 2)(thousands ofyen)

July 30, 2014

800,000

846,000

Real EstateAppraiser

Appraisal Date

Japan Real
Estate Institute

July 1, 2014

(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) JPR already owns beneficiary interest in part of the property as trust property. JPR executed an additional trust agreement with the trustee as of July 30, 2014 forthe additionally acquired portion and added the portion to the said trust property, so that JPR currently owns trust beneficiary interest in the both portions.

(4) Transactions with Interested Parties and Major Shareholders
1) Transaction Status
No transaction of specified assets or other deals with interested parties and major shareholders were conducted during the 26th
fiscal period.
2) Value of Fee Expenses

Category

Total Paid Fees
(A)

Property Brokerage Fees

10,000Management Fees (Note 2)

248,111

Outsourcing Fees

530,743

Tenant Brokerage Fees

25,179Advertising Cost of the Company

4,713(Thousands of yen)

Breakdown of Transaction with Interested Parties and Major
Shareholders

Ratio to Total
Amount(B/A))

Paid Party

Paid Amount (B)Yasuda Real Estate Co., Ltd.

10,000100.0%

Tokyo Tatemono Co., Ltd.

211,824

85.4%

Yasuda Real Estate Co., Ltd.

14,647

5.9%

Taisei-Yuraku Real Estate Co., Ltd.

3,279

1.3%

Tokyo Tatemono Co., Ltd.

412,787

77.8%

Yasuda Real Estate Co., Ltd.

37,361

7.0%

Tokyo Tatemono Co., Ltd.

1,563

6.2%

Yasuda Real Estate Co., Ltd.

1,254

5.0%

163

3.5%

E-State Online Co., Ltd.

49
51

III. Asset Management Report(Note 1) Interested parties and major shareholders refers to the interested parties of the asset management company who has concluded an asset management agreementwith JPR and is regulated as designated in Article 123 of the Enforcement Order of the Act on Investment Trusts and Investment Corporations and article 26-1-27of the regulation on management reports in regard to investment trusts and investment corporations of The Investment Trusts Association, Japan.
(Note 2) The management fees indicated in the above table include construction management fees (total of 16,201 thousand yen) appropriated as assets and not handled 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 26th fiscal period.
Tokyo Tatemono Co., Ltd.

529,290 thousand yen

Yasuda Real Estate Co., Ltd.

33,628 thousand yen

Tokyo Real Estate Management Co., Ltd.

344,136 thousand yen

Shinjuku Center Building Management Co., Ltd.

41,948 thousand yen

Taisei-Yuraku Real Estate Co., Ltd.

114 thousand yen(5) Transactions with the Asset Management Company regarding Concurrent
Work Conducted by the Asset Management 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.

50
52

Japan Prime Realty Investment Corporation

7. Overview of Accounting(1) Assets, Liabilities, Principal, and Profits and Loss
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.

(2) Changes in Calculation Method of Depreciation
No change has been made.

(3) Changes in Valuation Method of Real Estate
No change has been made.

51
53

III. Asset Management Report

8. Overview of Self-Managed Investment Trust Beneficiary Certificates(1) Acquisition
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) Units Held
Number of Units Held at End of
PeriodRatio to Total Units Issued
and Outstanding (%)

17th Fiscal Period(Jan. 1, 2010 – Jun. 30, 2010)

100

20

0.0

18th Fiscal Period(Jul. 1, 2010 – Dec. 31, 2010)

100

20

0.0

19th Fiscal Period(Jan. 1, 2011 – Jun. 30, 2011)

100

20

0.0

20th Fiscal Period(Jul. 1, 2011 – Dec. 31, 2011)

100

20

0.0

21st Fiscal Period(Jan. 1, 2012 – Jun. 30, 2012)

100

20

0.0

22nd Fiscal Period(Jul. 1, 2012 – Dec. 31, 2012)

100

20

0.0

23rd Fiscal Period(Jan. 1, 2013 – Jun. 30, 2013)

100

20

0.0

24th Fiscal Period(Jul. 1, 2013 – Dec. 31, 2013)

100

20

0.0

25th Fiscal Period(Jan. 1, 2014 – Jun. 30, 2014)

100

20

0.0

26th Fiscal Period(Jul. 1, 2014 – Dec. 31, 2014)

100

20

0.0

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

52
54

Total Investment at End of
Period (Note)(millions of yen)Japan Prime Realty Investment Corporation

9. Disclosure on Corporation Owning Foreign Real Estate
Not applicable

10. Disclosure on Real Estate Owned by Corporation Owning Foreign Real Estate
Not applicable

11. Other(1) Notice
Major issues related to the execution and modification, etc. of major agreements approved at JPR’s Board of Directors meeting in the
26th fiscal period include the following:
Date of Board of
Directors
Meeting

Approved Item
Consignment of administrative services
concerning the issuance of the Twentieth

July 3, 2014

Series and the Twenty-first Series ofUnsecured Investment Corporation Bonds(Note)
Consignment of administrative services

November 14,
2014

Overview
JPR consigned the administrative services related to the issuance of the Twentieth and theTwenty-first Series of Unsecured Investment Corporation Bonds to SMBC Nikko Securities Inc.,
Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Mizuho Securities Co., Ltd. and Mizuho Bank,
Ltd. based on the decision by the executive director to issue the Bonds.
JPR consigned the administrative services related to the issuance of the Twenty-second Series ofconcerning issuance of the Twenty-second

Unsecured Investment Corporation Bonds to Mizuho Securities Co., Ltd., Mitsubishi UFJ Morgan

Unsecured Investment Corporation Bonds

Stanley Securities Co., Ltd., Daiwa Securities Co., Ltd. and Mizuho Bank, Ltd. based on the decision(Note)

by the executive director to issue the Bonds. (Note) A comprehensive resolution on the issuance of the Investment Corporation Bonds was approved at JPR’s Board of Directors meeting held on April 24, 2014. On
this approval, JPR issued the Twenties and the Twenty-first Series of Unsecured Investment Corporation Bonds on July 22, 2014 and the Twenty-second
Unsecured Investment Corporation Bonds on December 4, 2014, respectively.

(2) Other
Unless otherwise stated, monetary amounts are rounded down and percentage figures are rounded off to the nearest specified unit inthis asset management report.

53
55

IV. Financial Statements(1) Balance Sheets

AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Other
Total current assets

Noncurrent assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net*1

End of 26th Fiscal Period(Dec. 31, 2014)㻌㻌
11,557,849
11,517,632
336,831
140,576
9,509

12,117,339
11,227,028
260,988
174,781
6,743

23,562,400

23,786,880

57,363,236(10,567,703)

56,652,548(11,121,439)

46,795,533

㻌

*1

45,531,108

Buildings in trust
Accumulated depreciation

83,036,800(24,402,931)

84,667,091(25,618,333)

Buildings in trust, net

58,633,868

59,048,758

Structures
Accumulated depreciation

45,366(12,774)

45,661(14,089)

Structures, net
Structures in trust
Accumulated depreciation

32,591

31,571

120,534(61,138)

120,534(65,156)

Structures in trust, net

59,39555,378

Machinery and equipment
Accumulated depreciation

725,345(333,349)

726,204(341,835)

Machinery and equipment, net*1

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

391,995*1

384,368

1,583,846(1,118,278)

1,605,767(1,168,396)

465,568

437,370

50,301(28,524)

54,610(29,761)

Tools, furniture and fixtures, net

21,777

24,848Tools, furniture and fixtures in trust
Accumulated depreciation

156,607(95,353)

159,172(101,991)

Tools, furniture and fixtures in trust, net
LandLand in trust
Construction in progress
Construction in progress in trust
Total property, plant and equipment
Intangible assets
Leasehold right
Other
Total intangible assets
Investments and other assets
Lease and guarantee deposits
Long-term prepaid expenses
Total investments and other assets
Total noncurrent assets

Deferred assets
Investment corporation bond issuance costs
Total deferred assets

Total assets

54
56(Thousands of yen)

End of 25th Fiscal Period(Jun. 30, 2014)

61,254*1

110,601,033
168,132,889
9,527-

57,181*1

109,041,559
170,276,140
39,223
1,063

385,205,434

384,928,571

4,794,109
3,585

4,794,109
3,020

4,797,695

4,797,130

53,953296,996

96,205248,976

350,950

345,181

390,354,080

390,070,883

188,176

233,806

188,176

233,806

414,104,657

414,091,570

Japan Prime Realty Investment Corporation

Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Current portion of investment corporation bonds
Accounts payable-otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Total current liabilities

Noncurrent liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust(Thousands of yen)

End of 25th Fiscal Period(Jun. 30, 2014)*1

Total noncurrent liabilities

Total liabilities

Net assets
Unitholders' equity
Unitholders' capital
Surplus㻌 㻌 Voluntary reserve
Reserve for reduction entry

End of 26th Fiscal Period(Dec. 31, 2014)

㻌㻌
1,871,405
2,000,000
6,332,000
24,000,000
589,177
184,085605
309,1122,613,999

㻌
2,137,918
19,732,000
13,000,000
572,670
150,603605
261,634
2,565,259

37,900,385

38,420,691

32,500,000
126,358,000
7,624,960
12,508,179

41,500,000
116,792,000
7,364,647
12,636,178*1

178,991,139

178,292,826

216,891,525

216,713,518

192,044,238

192,044,238

73,94673,946

Total voluntary reserve

73,94673,946

Unappropriated retained earnings(undisposed losses)

5,094,946

5,259,866

Total surplus
Total unitholders' equity

Total net assets

Total liabilities and net assets*3

5,168,893

5,333,813

197,213,131

197,378,051

197,213,131
414,104,657*3

197,378,051
414,091,570

55
57

IV. Financial Statements(2) Statements of Income and Retained Earnings

Operating revenue㻌㻌 Rent revenue-real estate㻌Total operating revenue

Operating expenses
㻌 Expenses related to rent business㻌 Asset management fee
㻌 Administrative service and asset custody fees
㻌 Directors' compensation
㻌 Trust fees㻌 Other operating expenses
㻌

Total operating expenses

Operating income

Non-operating income
㻌 Interest income㻌 Income on settlement of management association accounts
㻌 Other㻌

Total non-operating income

Non-operating expenses
㻌 Interest expenses
㻌 Borrowing expenses
㻌 Interest expenses on investment corporation bonds
㻌 Amortization of investment corporation bond issuance costs
㻌 Other㻌

Total non-operating expenses

Ordinary income

Income before income taxes
Income taxes-current
㻌 Total income taxes
Net income

Retained earnings brought forward
Unappropriated retained earnings (undisposed losses)

56
58(Thousands of yen)

25th Fiscal Period(Jan. 1, 2014 –Jun. 30, 2014)*1

26th Fiscal Period(Jul. 1, 2014 –Dec. 31, 2014)㻌
13,734,191*1

13,734,191*1

㻌
6,599,484
478,665
79,4876,600
35,674
108,811

㻌
13,902,843
13,902,843*1

㻌
6,733,535
485,787
78,4176,600
32,15089,007

7,308,723

7,425,498

6,425,467

6,477,345

㻌
2,183
40,831
4,669

㻌
2,191
4,724
5,055

47,684

11,971

㻌
847,872
110,556
411,606
28,4091,136

㻌
778,90376,431
363,968
29,815922

1,399,581

1,250,041

5,073,570

5,239,275

5,073,570

5,239,275

605

605

605

605

5,072,965

5,238,670

21,981
5,094,946

21,196
5,259,866

Japan Prime Realty Investment Corporation(3) Statements of Changes in Unitholders’ Equity(Thousands of yen)

25th Fiscal Period㻌㻌㻌Unitholders' equity

Unitholders' capital
Balance at beginning of current period

26th Fiscal Period(Jan. 1, 2014 –Jun. 30, 2014)(Jul. 1, 2014 –Dec. 31, 2014)㻌㻌
192,044,238

㻌㻌
192,044,238

Changes of items during the period
Total changes of items during the period
Balance at end of current period
Surplus
Voluntary reserve
Balance at beginning of current period
Changes of items during the period
Total changes of items during the period
Balance at end of current period
Unappropriated retained earnings (undisposed losses)
Balance at beginning of current period－－

192,044,238

192,044,238

73,94673,946－－73,94673,946

㻌
4,976,931

Changes of items during the period
Dividends from surplus
Net income
Total changes of items during the period
Balance at end of current period(4,954,950)
5,072,965

Changes of items during the period
Total changes of items during the period
Balance at end of current period(5,073,750)
5,238,670

118,015

164,920

5,094,946

5,259,866

Total surplus
Balance at beginning of current period

5,094,946

㻌㻌
5,050,878

5,168,893

㻌118,015

164,920

5,168,893

5,333,813

Total unitholders' equity
Balance at the beginning of current period

197,095,116

Changes of items during the period
Total changes of items during the period㻌118,015

164,920

Balance at end of current period

197,213,131

197,378,051

Total net assets
Balance at beginning of current period
Changes of items during the period

197,095,116

Total changes of items during the period
Balance at end of current period㻌197,213,131

㻌
197,213,131

118,015

164,920

197,213,131

197,378,051

57
59

IV. Financial Statements(4) Statements of Cash Distributions

I.
II.

Unappropriated retained earnings
Distribution amount(Distribution amount per unit)

III.

Retained earnings carried forward

Method for calculating distribution amount

58
60

25th Fiscal Period(January 1, 2014 –June 30, 2014)
5,094,946,448 yen
5,073,750,000 yen(6,150 yen)

26th Fiscal Period(July 1, 2014 –December 31, 2014)
5,259,866,639 yen
5,239,575,000 yen(6,351 yen)

21,196,448 yen

20,291,639 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. Based onsuch policy, JPR decided to pay out
distributions of earnings of 5,073,750,000 yen,which is the largest integral multiple of thenumber of investment units issued andoutstanding (825,000 units) in an amount notin excess of unappropriated retained earnings
while minimizing the burden to unitholders
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 of Incorporation.

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. Based onsuch policy, JPR decided to pay out
distributions of earnings of 5,239,575,000 yen,which is the largest integral multiple of thenumber of investment units issued andoutstanding (825,000 units) in an amount notin excess of unappropriated retained earnings
while minimizing the burden to unitholders
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 of Incorporation.

Japan Prime Realty Investment Corporation(5) Statements of Cash Flows(Thousands of yen)

25th Fiscal Period

26th Fiscal Period(January 1, 2014 –Net cash provided by (used in) operating activities
㻌 Income before income taxes
㻌 Depreciation and amortization(July 1, 2014 –June 30, 2014)

December 31, 2014)

㻌
5,073,570
1,834,573

㻌
5,239,275
1,841,516

28,409(2,183)29,815(2,191)

1,259,478(65,696)

1,142,872
75,843㻌㻌

Amortization of investment corporation bond issuance costs
Interest income㻌㻌Interest expenses
Decrease (increase) in operating accounts receivable㻌

Decrease (increase) in prepaid expenses

48,616(34,205)㻌㻌

Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable-other

151,017(922)

211,1104,584㻌㻌Increase (decrease) in accrued consumption taxes
Increase (decrease) in advances received

134,962
167,781(47,477)(48,740)

㻌

Other, net

90,06644,499㻌

Subtotal

8,719,673

8,456,902

㻌Interest income received

㻌Interest expenses paid㻌Income taxes (paid) refund

(625)

(606)

㻌

Net cash provided by (used in) operating activities

7,431,292

7,282,132

Net cash provided by (used in) investing activities㻌 Purchase of property, plant and equipment
㻌 Purchase of property, plant and equipment in trust㻌㻌(237,814)(353,419)(187,215)(1,321,470)(2,067)(51,612)(42,251)(261,689)

2,183

2,191

(1,289,939)(1,176,354)

㻌Payment of tenant leasehold and security deposits
Repayments of tenant leasehold and security deposits

㻌Proceeds from tenant leasehold and security deposits

208,409125,187

㻌㻌

Repayments of tenant leasehold and security deposits in trust
Proceeds from tenant leasehold and security deposits in trust(241,336)
246,435(390,772)
375,367

㻌Net cash provided by (used in) investing activities(431,404)(1,702,844)

Net cash provided by (used in) financing activities
㻌 Increase in short-term loans payable
Repayment of short-term loans payable㻌 Proceeds from long-term loans payable㻌－㻌
10,000,000－
11,500,000(12,000,000)
4,000,000

㻌

Repayment of long-term loans payable(12,069,000)(166,000)㻌

Proceeds from issuance of investment corporation bonds
Redemption payment of investment corporation bonds

4,961,866(5,000,000)

8,929,218(11,000,000)

㻌

Dividends paid

(4,955,077)(5,073,621)

㻌Net cash provided by (used in) financing activities(5,562,210)(5,310,403)

Net changes in cash and cash equivalents

Cash and cash equivalents at beginning of current period
Cash and cash equivalents at end of current period

1,437,676

268,885

21,637,805

23,075,482

23,075,482

23,344,367

59
61

IV. Financial Statements(6) Notes to Financial Statements(Basis of Presenting Financial Statements)
Japan Prime Realty Investment Corporation (JPR) maintains its accounting records and prepares its financial statements inaccordance with 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 (ITA), the Companies Act and therelated regulations, which are different in certain respects as to the application and disclosure requirements of International Financial
Reporting Standards.
The accompanying financial statements are basically a translation of the financial statements of JPR, which were prepared inaccordance with Japanese GAAP. In preparing the accompanying financial statements, certain reclassifications have been made to thefinancial statements issued domestically in order to present them in a format which is more 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.

Depreciation Method for
Property and Equipment

2. Accounting for Deferred Assets
3. Standards for Recording
Revenues and Expenses

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



60
62

(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 acquisition prices 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.
Investment Corporation Bond Issuance Costs
Investment corporation bond issuance costs are amortized utilizing the straight-line method over the redemption
periods.
Accounting Treatment of Taxes on Property and Equipment
In connection with property taxes, city planning taxes and depreciated asset taxes, JPR uses the method of
charging the corresponding amounts of assessed taxes to the current fiscal period as real estate rental expenses.
Furthermore, JPR included an amount equivalent to the property taxes paid to the sellers during the first fiscal
period as an acquisition 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 amounted to
0 yen and 2,247 thousand yen for the fiscal periods ended June 30, 2014 and December 31, 2014, respectively.
Cash and cash equivalents in the Statements of Cash Flows include the following(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 thebalance sheets and statements of income and retained earnings.
Furthermore, the following material accounts are separately stated in the balance sheet 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
National and local consumption taxes are accounted with the consumption taxes excluded.

Japan Prime Realty Investment Corporation(Notes to Balance Sheets)*1. Assets Pledged as Collateral and Secured Liabilities
Assets pledged as collateral are as follows:(Thousands of yen)
End of 25th Fiscal Period(as of June 30, 2014)


Buildings (net)
Machinery and equipment (net)
Land
Total

End of 26th Fiscal Period(as of December 31, 2014)
118,902

117.033

3,253

3,081

399,183

399,183

521,339519,299

Secured liabilities are as follows:(Thousands of yen)
End of 25th Fiscal Period(as of June 30, 2014)
Tenant leasehold and security deposits
Total

End of 26th Fiscal Period(as of December 31, 2014)
15,536

15,536

15,536

15,536

2. 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 25th Fiscal Period(as of June 30, 2014)

Credit limit

End of 26th Fiscal Period(as of December 31, 2014)
28,000,000

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

28,000,000－－

28,000,000

28,000,000*3. Minimum Total Unitholders’ Equity Designated in Article 67- 4 in the Act on Investment Trusts and Investment Corporations(Thousands of yen)
End of 25th Fiscal Period(as of June 30, 2014)

End of 26th Fiscal Period(as of December 31, 2014)
50,00050,00061
63

IV. Financial Statements(Notes to Statements of Income and Retained Earnings)*1. Breakdown of Rent Revenue-Real Estate and Expenses Related to Rent Business(Thousands of yen)

25th Fiscal Period(January 1, 2014 –June 30, 2014)

26th Fiscal Period(July 1, 2014 –December 31, 2014)

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

9,196,674
1,499,750
1,866,927

9,306,026
1,530,000
1,838,471

Parking revenues

255,983

257,212Advertising expenses
Antenna use fees

59,31818,08460,17918,139Other

34,99233,804

12,931,730

13,043,834

Subtotal
Other rental revenues
Incidental income

715,023

810,460

Time-based parking revenues
Cancellation charges

5,159
23,686

5,184
15,366

Income equivalent to expenses for restoration
to original condition

24,841

6,780

Other miscellaneous income

33,74921,217

Subtotal

802,461

859,008

Total rent revenue-real estate

13,734,191

13,902,843

Outsourcing expenses

524,536

529,363

Utilities expenses
Property and other taxes

860,650
1,990,821

983,434
1,985,098

Casualty insurance
Repairs and maintenance

27,210444,215

27,645445,005

Property management fees
Management association accounts

227,181562,213

231,909556,026

1,834,057

1,841,016

B. Expenses Related to Rent Business

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

128,596

134,034

6,599,484

6,733,535
7,169,307

7,134,706(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

62
64

25th Fiscal Period(January 1, 2014 – June 30, 2014)

26th Fiscal Period(July 1, 2014 – December 31, 2014)

5,000,000 units

5,000,000 units

825,000 units

825,000 units

Japan Prime Realty Investment Corporation(Notes to Statements of Cash Flows)*1. Relationship between the Cash and Cash Equivalents at End of Period in the Statements of Cash Flows and the Amounts of theCorresponding Accounts on the Balance Sheets(Thousands of yen)

25th Fiscal Period(January 1, 2014 – June 30, 2014)

26th Fiscal Period(July 1, 2014 – December 31, 2014)

Cash and deposits

11,557,849

12,117,339

Cash and deposits in trust

11,517,632

11,227,028

Cash and cash equivalents

23,075,482

23,344,367(Leases)
Future lease revenues under non-cancelable operating leases(Thousands of yen)

25th Fiscal Period(January 1, 2014 – June 30, 2014)

26th Fiscal Period(July 1, 2014 – December 31, 2014)

Due within one year

6,141,257

5,543,892

Due after one year

19,871,937

18,230,589

Total

26,013,195

23,774,481

(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 ofshort-term funds that emphasize flexibility.
There may be cases where JPR will engage in derivative transactions, but such will be limited to management 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 failure of the financial institutions holding the deposits and other credit risks, but 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 liquidity
risks are managed through such measures as procuring funds from the capital market by increasing capital, executing acommitment line agreement with the main lending financial institutions, and also having statements of cash receipts anddisbursements prepared by the financial division.
(3) Supplementary Explanation on Matters Concerning Estimated Fair Value, etc. of Financial Instruments
The estimated fair value of financial instruments, aside from values based on market price, include values based on reasonablecalculations when there is no market price. Certain assumptions, etc. are used in calculating those values and there may be cases
where the values will vary when different assumptions, etc. are used.

2. Matters Concerning Estimated Fair Value, etc. of Financial Instruments
The following are the carrying values and estimated fair values as of June 30, 2014 of financial instruments, and the difference

63
65

IV. Financial Statements

between these amounts. Please note that the following table does not include those for which discerning of estimated fair value isrecognized to be extremely difficult (please refer to Note 3).
(Thousands of yen)Carrying Value(Note 1)

Estimated Fair
Value (Note 1)

Difference(1)

Cash and deposits

11,557,849

11,557,849－(2)

Cash and deposits in trust

11,517,632

11,517,632－(3)

Short-term loans payable(2,000,000)(2,000,000)－(4)

Current portion of long-term loans payable(6,332,000)(6,409,432)

77,432(5)

Current portion of investment corporation bonds(24,000,000)(24,231,152)

231,152(6)

Investment corporation bonds(32,500,000)(33,577,888)

1,077,888(7)

Long-term loans payable(126,358,000)(128,680,083)

2,322,083

The following are the carrying values and estimated fair values as of December 31, 2014 of financial instruments, and the difference
between these amounts. Please note that the following table does not include those for which discerning of estimated fair value isrecognized to be extremely difficult (please refer to Note 3).
(Thousands of yen)Carrying Value(Note 1)

Estimated Fair
Value (Note 1)

Difference(1)

Cash and deposits

12,117,339

12,117,339－(2)

Cash and deposits in trust

11,227,028

11,227,028－(3)

Short-term loans payable

－

－

－

(4)

Current portion of long-term loans payable(19,732,000)(19,818,454)

86,454(5)

Current portion of investment corporation bonds(13,000,000)(13,046,800)

46,800(6)Investment corporation bonds(41,500,000)(42,938,833)

1,438,833(7)

Long-term loans payable(116,792,000)(119,165,205)

2,373,205(Note 1) Liabilities are shown in parentheses.
(Note 2) Method of calculation of estimated fair value of financial instruments(1) Cash and deposits, and (2) Cash and deposits in trust
As these financial instruments are settled within a short period of time, the estimated fair value is approximately the same as the book value and is thusstated at that book value.
(3) Short-term loans payable
As these financial instruments are settled within a short period of time and have floating interest rates, the estimated fair value is approximately the same as
the book value and is thus stated at that book value.
(4) Current portion of long-term loans payable, and (7) Long-term loans payable
Of the estimated fair value of these financial instruments, the fair value of long-term loans payable with floating interest rates is based on the book value, as
it reflects the market interest rate within a short period of time and thus is considered to be nearly equal to the book value. The fair value of long-term loans
payable with fixed interest rates is based on the method of calculating by discounting the total amount of principal and interest by the rate assumed as being
applicable in the event of a new drawdown corresponding to the remaining loan term.
(5) Current portion of investment corporation bonds, and (6) Investment corporation bonds
Of the estimated fair value of these financial instruments, those with market price are calculated based on market price and those with no market price arecalculated according to the fair value of long-term loans payable with fixed interest rates in (4) and (7) above.
(Note 3) Financial instruments for which discerning of estimated fair value is recognized to be extremely difficult.
Tenant leasehold and security deposits and tenant leasehold and security deposits in trust that are deposited by lessees of lease rental properties are not subject todisclosure of estimated fair value because reasonable estimation of cash flows is recognized to be extremely difficult since there is no market price and also since
it is difficult to calculate the actual deposit period from when lessees move in to when they move out. The following is the carrying value of tenant leasehold andsecurity deposits, and tenant leasehold and security deposits in trust.

(Thousands of yen)64
66

Japan Prime Realty Investment Corporation

End of 25th Fiscal Period(as of June 30, 2014)

Category

End of 26th Fiscal Period(as of December 31, 2014)

Tenant leasehold and security deposits

7,624,960

7,364,647

Tenant leasehold and security deposits in trust

12,508,179

12,636,178(Note 4) Scheduled redemption of monetary claims to be due after the account closing date of the 25th fiscal period (June 30, 2014)(Thousands of yen)

Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due after Three Due after FourYears through Years throughFour Years
Five Years

Cash and deposits

11,557,849

－

－

－

－

－

Cash and deposits in trust

11,517,632

－

－

－

－

－

Scheduled redemption of monetary claims to be due after the account closing date of the 26th fiscal period (December 31, 2014)

Due after Five
Years(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Due after Three Due after FourYears through Years throughFour Years
Five Years

Cash and deposits

12,117,339

－

－

－

－

－

Cash and deposits in trust

11,227,028

－

－

－

－

－

Due after Five
Years

(Note 5) Amount of repayment or redemption of short-term loans payable, investment corporation bonds and long-term loans payable scheduled to be due after theaccount closing date of the 25th fiscal period (June 30, 2014)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

Short-term loans payable

2,000,000

－

－

－

－

－

Investment corporation bonds

24,000,000－

7,000,000

10,000,000

2,000,000

13,500,000

Long-term loans payable

6,332,000

26,732,000

23,732,000

20,374,000

17,200,000

38,320,000Due after Three Due after FourYears through Years throughFour Years
Five Years

Due after Five
Years

Amount of repayment or redemption of short-term loans payable, investment corporation bonds and long-term loans payable scheduled to be due after theaccount closing date of the 26th fiscal period (December 31, 2014)(Thousands of yen)Due in One
Year or Less

Due after One
Year throughTwo Years

Due after Two
Years throughThree Years

－

－

－

－

－

－

Investment corporation bonds

13,000,000

7,000,000

5,000,000

7,000,000

4,000,000

18,500,000

Long-term loans payable

19,732,000

18,332,000

32,632,000

16,408,000

17,100,000

32,320,000
Short-term loans payable

Due after Three Due after FourYears through Years throughFour Years
Five Years

Due after Five
Years

(Securities)
25th fiscal period (as of June 30, 2014)
Not applicable
26th fiscal period (as of December 31, 2014)
Not applicable(Derivative Transactions)25th fiscal period (as of June 30, 2014)
Not applicable as JPR conducted no derivative transactions
26th fiscal period (as of December 31, 2014)
Not applicable as JPR conducted no derivative transactions

65
67

IV. Financial Statements(Retirement Benefits)
25th fiscal period (as of June 30, 2014)
Not applicable as JPR does not have any retirement benefit system
26th fiscal period (as of December 31, 2014)
Not applicable as JPR does not have any retirement benefit system(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

25th Fiscal Period(January 1, 2014 – June 30, 2014)

Effective statutory tax rate
(Adjustment)
Deductible cash distributions

36.59%

34.16%



(36.59%)(34.16%)

Other

0.01%

0.01%

Effective tax rate after applying tax effect accounting

0.01%

0.01%



(Equity Method Income and Retained Earnings)
25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable as JPR does not have any affiliated companies
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable as JPR does not have any affiliated companies(Transactions with Related Parties)
1. Parent Company and Major Corporation Unitholders
25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable
2. Subsidiaries
25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable
3. Sister Companies
25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable
4. Directors and Major Individual Unitholders
25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable

66
68

26th Fiscal Period(July 1, 2014 – December 31, 2014)

Japan Prime Realty Investment Corporation(Asset Retirement Obligations)25th fiscal period (January 1, 2014 – June 30, 2014)
Not applicable
26th fiscal period (July 1, 2014 – December 31, 2014)
Not applicable(Segment Information)[Segment Information]
Disclosure is omitted as JPR is comprised of a single reportable segment engaged in the property rental business.
[Related Information]
25th fiscal period (January 1, 2014 – June 30, 2014)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service segment is in excess of 90% of operating
revenues on the Statements of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from external customers attributed to Japan are in excess of 90% of total revenues on theStatements of Income and Retained Earnings.
(2) Tangible Fixed Assets
Disclosure is omitted as tangible fixed assets located in Japan are in excess of 90% of total tangible fixed assets 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 revenues on theStatements of Income and Retained Earnings.
26th fiscal period (July 1, 2014 – December 31, 2014)
1. Information about Products and Services
Disclosure is omitted as sales to external customers for the single product and service segment is in excess of 90% of operating
revenues on the Statements of Income and Retained Earnings.
2. Information about Geographic Areas(1) Revenues from Overseas Customers
Disclosure is omitted as revenues from external customers attributed to Japan are in excess of 90% of total revenues on theStatements of Income and Retained Earnings.
(2) Tangible Fixed Assets
Disclosure is omitted as tangible fixed assets located in Japan are in excess of 90% of total tangible fixed assets 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 revenues on theStatements of Income and Retained Earnings.

(Investment and Rental Properties)
JPR owns office properties (urban commercial facilities) and retail properties for leasing in Tokyo and other regions. The
following is the carrying value on the balance sheets, amount of increase (decrease) during the period and estimated fair value ofthese investment and rental properties.


Carrying Value on the Balance Sheets
Balance at Beginning of Period

Amount of Increase (Decrease) during the Period
Balance at End of Current Period
Estimated Fair Value at End of Period

25th Fiscal Period(January 1, 2014 – June 30, 2014)
391,225,225(Thousands of yen)

26th Fiscal Period(July 1, 2014 – December 31, 2014)



390,001,463(1,223,761)(276,927)

390,001,463
379,917,000

389,724,535
387,697,000

67
69

IV. Financial Statements(Note 1) The carrying value on the balance sheets is the cost of acquisition less accumulated depreciation.
(Note 2) Of the amount of increase (decrease) during the periods for investment and rental properties, the amount of decrease for the 25th fiscal period is primarily
attributable to depreciation (1,834,057 thousand yen). The amount of increase for the 26th fiscal period is primarily attributable to additional acquisition of
Shibadaimon Center Bldg. (826,787 thousand yen), and the amount of decrease for the period is primarily attributable to depreciation (1,841,016 thousand yen).
(Note 3) The estimated 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 25th and 26th fiscal periods for investment and rental properties are as presented in the “Notes toStatements of Income and Retained Earnings.”(Per Unit Information)


25th Fiscal Period(January 1, 2014 – June 30, 2014)

Total net assets per unit
Net income per unit

26th Fiscal Period(July 1, 2014 – December 31, 2014)

239,046 yen

239,246 yen

6, 149 yen

6, 349 yen(Note 1) Net income per unit is computed 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)Amounts not attributable to ordinary unitholders (thousands of yen)
Net income attributable to ordinary investment units (thousands of yen)
Average number of units during the fiscal period(Subsequent Events)
Not applicable

68
70

25th Fiscal Period(January 1, 2014 – June 30, 2014)
5,072,965

26th Fiscal Period(July 1, 2014 – December 31, 2014)
5,238,670－
5,072,965－
5,238,670

825,000 units

825,000 units

Japan Prime Realty Investment Corporation(7) Detailed Schedules
1) Schedule of securities
Not applicable2) Status of contract amounts, etc. and estimated fair value of derivative transactions and forward exchange transactions
Not applicable3) Schedule of assets related to real estate

Asset Type

Current Assets

Increase
Decrease
Balance as ofduring theduring theJuly 1, 2014
PeriodPeriod(thousands of(thousands of (thousands of
yen)
yen)
yen)

－














57,363,236
45,366

129,172295

839,861-

56,652,548
45,661

11,121,439
14,089782,738
1,315

45,531,108
31,571

725,345

15,03814,179726,204

341,835

19,080384,368

50,301

5,398

1,089

54,61029,761

2,066

24,848



110,601,033-

1,559,474

109,041,559--

109,041,559



9,527

29,695-39,223--39,223



168,794,810

179,600

2,414,605

166,559,806

11,507,126

805,201

155,052,679

83,036,800
120,534

1,630,290--

84,667,091
120,534

25,618,333
65,156986,398
4,017

59,048,758
55,378

1,583,846

21,921-

1,605,767

1,168,396

39,524437,370

156,607

2,565-

159,172

101,991

5,809

57,181

168,132,889

2,143,251-

170,276,140--

170,276,140

-

1,113

50

1,063

-

-

1,063

Subtotal

253,030,677

3,799,14250

256,829,770

26,953,878

1,035,750

229,875,892 

Total

421,825,488

3,978,743

2,414,655

423,389,576

38,461,004

1,840,951

384,928,571

Intangible Assets
Leasehold rights
Other

4,794,109
7,602

－
－

－
－

4,794,109
7,602

4,581

565

4,794,109
3,020

Total

4,801,712--

4,801,712

4,581

565

4,797,130

Subtotal(Beneficiary interests
in trust)
Buildings in trust
Structures in trust
Machinery andequipment in trust
Tools, furnitureand fixtures intrust
Land in trust
Construction inprogress in trust



－




－

Depreciation Net Balance as ofDecember 31,
during theRemarks
2014
Period(thousands of (thousands of yen)
yen)
－
－
－




Or Accumulated
Amortization(thousands ofyen)

Noncurrent Assets(Property, plant andequipment)
Buildings
Structures
Machinery andequipment
Tools, furnitureand fixtures
Land
Construction inprogress－

Accumulated Depreciation

Balance as ofDecember 31,
2014(thousands ofyen)

(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, tools,
furniture and fixtures in trust and land in trust, the increase includes the transfer from real estate to beneficiary interests in trust as a result of executing an
additional trust agreement.
(Note 2) The “Decrease during the Period” in construction in progress in trust is due to the transfer to relevant accounts as a result of construction completion. For
buildings, machinery and equipment, tools, furniture and fixtures and land, the decrease is due to the transfer from real estate to beneficiary interests in trust as aresult of executing an additional trust agreement.

4) Schedule of other specified assets
Not applicable69
71

IV. Financial Statements

5) Schedule of investment corporation bonds

Decreaseduring the
Period(thousands ofyen)

Balance as ofDecember 31,
2014(thousands ofyen)

Coupon
Rate
(%)

Name

Issue Date

Balance as ofJuly 1, 2014
(thousands ofyen)

Sixth Series of Investment
Corporation Bonds (Note 1)

Nov. 4, 2004

5,000,000

5,000,000

－

2.000

Purchase of
Nov. 4, 2014 properties andrepayment of loans

Seventh Series ofInvestment Corporation
Bonds (Note 2)

Dec. 14, 2006

4,500,000－

4,500,000

2.900

Dec. 14, 2026

Ninth Series ofInvestment
Corporation Bonds(Note 2)

Jul. 23, 2007

6,000,000

6,000,000

－

2.100

Jul. 23, 2014

Eleventh Series ofInvestment Corporation
Bonds (Note 2)

Mar. 12, 2010

6,000,000－

6,000,000

1.680

Mar. 12, 2015

Twelfth Series ofInvestment Corporation
Bonds (Note 2)

May 21, 2010

7,000,000－

7,000,000

1.270

May 21, 2015

Thirteenth Series ofInvestment Corporation
Bonds (Note 2)

Oct. 25, 2011

7,000,000－

7,000,000

0.950

Oct. 25, 2016

Fourteenth Series ofInvestment
Corporation Bonds(Note 2)

Oct. 25, 2011

2,000,000－

2,000,000

1.340

Oct. 25, 2018

Fifteenth Series ofInvestment Corporation
Bonds (Note 2)

Nov. 22, 2012

5,000,000－

5,000,000

0.680

Nov. 22, 2017

Sixteenth Series ofInvestment Corporation
Bonds (Note 2)

Nov. 22, 2012

2,000,000－

2,000,000

1.030

Nov. 22, 2019

Seventeenth Series ofInvestment Corporation
Bonds (Note 2)

May 31, 2013

5,000,000－

5,000,000

0.650

May 31, 2018

Eighteenth Series ofInvestment Corporation
Bonds (Note 2)

May 31, 2013

2,000,000－

2,000,000

1.460

May 31, 2023

Nineteenth Series ofInvestment Corporation
Bonds (Note 2)

Feb. 5, 2014

5,000,000－

5,000,000

1.110

Feb. 5, 2024

Twentieth Series ofInvestment Corporation
Bonds (Note 2)

Jul. 22, 2014－－

2,000,000

0.303

Jul. 22, 2019

Twenty-first Series ofInvestment Corporation
Bonds (Note 2)

Jul. 22, 2014－－

4,000,000

1.278

Jul. 22, 2026

Twenty-second Series ofInvestment Corporation
Bonds (Note 2)

Dec. 4, 2014－－

3,000,000

0.831

Dec. 4, 2024

56,500,000

11,000,000

54,500,000

Maturity Date

Use

Remarks

Repayment of loans

Purchase ofproperties
Redemption of
investment
corporation
bonds andrepayment of loans
Unsecured

Repayment of loans

Total

Redemption of
investment
corporation bonds

Repayment of loans(Note 1) These investment corporation bonds are equipped with the same rank rider limited among investment corporation bonds and limitations on resale among
qualified institutional investors.
(Note 2) These investment corporation bonds are equipped with the same rank rider limited among certain investment corporation bonds.
(Note 3) Amounts of investment corporation bonds to be redeemed within five years after the date of the balance sheet 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

70
72

13,000,000

7,000,000

5,000,000

7,000,000

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

4,000,000

Japan Prime Realty Investment Corporation

6) Schedule of Loans Payable

LenderShort-term loans payable

Increase
Decrease
Balance as
Balance as ofduringduringof July. 1,
December 31,
Current
Current
2014
2014
PeriodPeriod(thousands(thousands of(thousands (thousandsof yen)yen)of yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Shinsei Bank, Ltd.

－

5,000,000

5,000,000－

0.340％

Nov. 28, 2014

Shinsei Bank, Ltd.

－

5,000,000

5,000,000－

0.310％

Dec. 5, 2014

The Norinchukin Bank

1,000,000－

1,000,000－

0.395％

Dec. 5, 2014

The Hachijuni Bank

0.460％

Sep. 24, 2014

1,000,000－

1,000,000

－

Total

2,000,000

10,000,000

12,000,000－

LenderIncrease
Decrease
Balance asduringduringof July 1,
Current
Current
2014
PeriodPeriod(thousandsof yen) (thousands (thousandsof yen)of yen)Balance as ofDecember 31,
2014(thousands ofyen)

Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Use

Remarks(Note 4)

Unsecured/
Unguaranteed/
Non-Subordinated

Use

Remarks

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

5,000,000--

5,000,000

1.414％

Feb. 4, 2016

Mizuho Bank Ltd.

7,000,000--

7,000,000

1.093％

Mar. 30, 2017
Dec. 5, 2019

Mizuho Bank Ltd.

2,000,000--

2,000,000

1.027％

Mizuho Bank Ltd.

3,000,000--

3,000,000

0.970％

Nov. 27, 2020
Jun. 27, 2023

Mizuho Bank Ltd.

5,000,000--

5,000,000

1.178％The Bank of Tokyo-Mitsubishi UFJ, Ltd.

5,000,000--

5,000,000

1.198％

Mar. 25, 2016
Aug. 8, 2019

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

1,000,000--

1,000,000

1.178％The Bank of Tokyo-Mitsubishi UFJ, Ltd.

1,000,000--

1,000,000

0.948％

Aug. 8, 2017
Sep. 5, 2017

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

3,000,000--

3,000,000

0.919％The Bank of Tokyo-Mitsubishi UFJ, Ltd.

1,000,000--

1,000,000

1.027％

Dec. 5, 2019Nov. 27, 2020

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

3,000,000--

3,000,000

0.970％The Bank of Tokyo-Mitsubishi UFJ, Ltd.

4,000,000--

4,000,000

0.889％

Jun. 25, 2021
Mar. 30, 2017

Sumitomo Mitsui Banking Corporation

6,400,000--

6,400,000

1.093％

Sumitomo Mitsui Banking Corporation

1,000,000--

1,000,000

1.027％

Dec. 5, 2019
Jun. 26, 2020

Sumitomo Mitsui Banking Corporation

3,000,000--

3,000,000

1.265％

Sumitomo Mitsui Banking Corporation

2,500,000--

2,500,000

1.033％

Jun. 27, 2022

Aozora Bank Ltd.

900,000--

900,000

0.994％

Jul. 3, 2017

Aozora Bank Ltd.

2,000,000--

2,000,000

1.178％

Aug. 8, 2019
Aug. 25, 2017

Aozora Bank Ltd.

2,000,000--

2,000,000

0.985％

Aozora Bank Ltd.

2,000,000--

2,000,000

1.146％

Aug. 30, 2018
Sep. 24, 2020

Aozora Bank Ltd.

1,000,000--

1,000,000

1.069％

Shinsei Bank, Ltd.

5,000,000--

5,000,000

1.397％

Apr. 5, 2019
Sep. 24, 2020

Shinsei Bank, Ltd.

2,000,000--

2,000,000

1.076％

Shinsei Bank, Ltd.

-2,000,000-

2,000,000

1.134％

Dec. 5, 2024
Mar. 30, 2017

Mizuho Trust & Banking Co., Ltd.

4,000,000--

4,000,000

1.093％

Mizuho Trust & Banking Co., Ltd.

3,000,000--

3,000,000

1.076％

Feb. 4, 2020

Mitsubishi UFJ Trust and Banking
Corporation

5,000,000--

5,000,000

1.184％

Aug. 29, 2017

1,000,000--

1,000,000

0.924％

Aug. 31, 2015

1,000,000--

1,000,000

0.843％

Jun. 26, 2015

Mitsubishi UFJ Trust and Banking
Corporation
Mitsubishi UFJ Trust and Banking
Corporation

Unsecured/(Note 4)

Unguaranteed/
Non-Subordinated71
73

IV. Financial Statements

Long-Term Loans Payable (Note 1)

Increase
Decrease
Balance as of
Balance as ofduringduringDecember 31,
July 1, 2014
Current
Current
2014(thousands ofPeriodPeriod(thousands ofyen)(thousands (thousands
yen)of yen)of yen)Average
Interest
Rate(Note 2)
(Note 3)

Repayment
Date

Use

Remarks

Development Bank of Japan, Inc.

3,000,000-

100,000

2,900,000

3.190％(Note 5)Development Bank of Japan, Inc.

820,000--

820,000

1.449％

Jun. 25, 2021

Development Bank of Japan, Inc.

2,000,000--

2,000,000

1.188％

Dec. 3, 2021

The Bank of Fukuoka

2,000,000--

2,000,000

1.170％

Jul. 7, 2016

The Bank of Fukuoka

2,000,000-

0.902％

Oct. 9, 2015

The Bank of Fukuoka

1,000,000--

2,000,000
1,000,000

0.911％

Sep. 24, 2019

Sompo Japan Nipponkoa Insurance Inc.

2,000,000--

2,000,000

0.981％

Oct. 11, 2016

Sompo Japan Nipponkoa Insurance Inc.

2,000,000--

2,000,000

0.874％

Dec. 25, 2015

Meiji Yasuda Life Insurance Company

3,670,000-

66,0003,604,000

1.800％(Note 6)ORIX Bank Corporation

1,000,000--

1,000,000

0.786％

Feb. 5, 2018

ORIX Bank Corporation

2,000,000--

2,000,000

0.762％

May 27, 2019

Shinkin Central Bank

3,000,000--

3,000,000

0.689％

Dec. 5, 2018

The Shinkumi Federation Bank

3,000,000--

3,000,000

0.786％

Feb. 5, 2018

Taiyo Life Insurance Company

1,000,000--

1,000,000

1.275％

Sep. 24, 2015

Taiyo Life Insurance Company

1,000,000--

1,000,000

0.949％

Jun. 4, 2018

Taiyo Life Insurance Company

1,000,000--

1,000,000

1.011％

Dec. 25, 2020

Chugoku Bank

2,000,000--

2,000,000

0.902％

Chugoku Bank

1,000,000--

1,000,000

0.758％

Unsecured/Oct. 9, 2015
Sep. 25, 2018 (Note 4) Unguaranteed/

The Nishi-Nippon City Bank, Ltd.

3,000,000--

3,000,000

1.149％

May 27, 2016

Sumitomo Life Insurance Company

2,000,000--

2,000,000

2.257％

Jun. 4, 2015

Zenkyoren (National Mutual Insurance
Federation of Agricultural Cooperatives)

2,000,000--

2,000,000

1.725％

Mar. 26, 2015

Daido Life Insurance Company

1,000,000--

1,000,000

1.666％

Feb. 5, 2015

Daido Life Insurance Company

1,000,000--

1,000,000

0.710％

Dec. 27, 2018

The Hachijuni Bank

1,000,000--

1,000,000

0.902％

Oct. 9, 2015

The Hachijuni Bank-

1,000,000-

1,000,000

0.424％

Sep. 26, 2016

Resona Bank, Ltd.

2,000,000--

2,000,000

1.093％

Mar. 30, 2017

The Iyo Bank, Ltd.

1,000,000--

1,000,000

0.902％

Oct. 9, 2015

Tokio Marine & Nichido Fire InsuranceCo., Ltd.

1,000,000--

1,000,000

0.710％

Dec. 27, 2018

The Tokyo Tomin Bank Limited (Note 7)

1,000,000--

1,000,000

0.626％

Sep. 30, 2015-

1,000,000-

1,000,000

0.440％

Dec. 5, 2017

1,000,000--

1,000,000

0.626％

Sep. 30, 2015

The Minato Bank, Ltd. (Note 7)

800,000--

800,000

0.626％

Sep. 30, 2015

The Yamaguchi Bank, Ltd. (Note 7)

500,000--

500,000

0.626％

Sep. 30, 2015

The Chiba Kogyo Bank, Ltd. (Note 7)

100,000--

100,000

0.626％

Sep. 30, 2015

132,690,000

4,000,000

166,000

136,524,000

The Norinchukin Bank
The Bank of Yokohama, Ltd. (Note 7)

Total(Note 1)

Amounts of long-term loans payable to be repaid within five years after the date of the balance sheet 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(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)72
74

19,732,000

18,332,000

32,632,000

16,408,000

Non-SubordinatedDue after Four Years
through Five Years(thousands of yen)
17,100,000

The average interest rates are weighted-average figures during the period and are rounded to the third decimal place. Furthermore, fees related to loanarrangement paid to the above lenders are not included.
Short-term loans payable are floating-rate loans payable. Long-term loans payable are fixed-rate loans payable, except those that fall under the category of Note 7.
Funds are used for purchasing real estate or real estate beneficiary interests in trust (including accompanying expenses), repaying loans payable and redemptionof investment corporation bonds, etc.
The loans payable are subject to repayment of 100 million yen on December 27, 2009 and thereafter every 6 months. In addition, repayment of 2,100 million
yen will be made on maturity date June 27, 2019.
The loans payable are subject to repayment of 66 million yen on June 27, 2012 and thereafter every 6 months. In addition, repayment of 3,208 million yen will
be made on maturity date June 21, 2018.
The loans are with floating interest rates.

Japan Prime Realty Investment Corporation(8) Independent Auditor’s Report7573

IV. Financial Statements(9) Other Notes (Information only)(Property and Equipment Leased to JPR)
25th Fiscal Period(January 1, 2014 – June 30, 2014) (Reference)

26th Fiscal Period(July 1, 2014 – December 31, 2014)

No property and equipment was leased to JPR

No property and equipment was leased to JPR(Transactions with Interested Parties)
25th fiscal period (January 1, 2014 – June 30, 2014)
Attribute

Name ofCompany, etc.

Business
Description or
Occupation

Asset
CustodianMizuho Trust& BankingCo., Ltd.

Bankingbusiness andtrust business

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

Transactions

Transaction
Amount(thousands of
yen)

－

－

Interest
expenses

37,687－

Account

Long-term
loans
payableAccruedexpenses

Balance at End
of Period(thousands ofyen)

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

26th fiscal period (July 1, 2014 – December 31, 2014)
Attribute

Name ofCompany, etc.

Business
Description or
Occupation

Asset
CustodianMizuho Trust& BankingCo., Ltd.

Bankingbusiness andtrust business

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

－

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

74
76

Transactions

Transaction
Amount(thousands of
yen)

－

－

Interest
expenses

38,312

Account

Long-term
loans
payableAccruedexpenses

Balance at End
of Period(thousands ofyen)

7,000,000
1,041

V. Investor Information

Japan Prime Realty Investment Corporation

Status of Investment Unit Price (as of December 31, 2014)
Market capitalization: ¥344.8 billion¥564,000 (May 7, 2007)
Trading High:¥130,300 (October 28, 2008)
Volume Low:
(units) Unit price at end of
32,000 26th Fiscal Period:¥418,000 (December 30, 2014)

Unit

Unit price (yen) Price

Trading volume (units)(yen)
580,000
520,000

28,000Offer price at additional offering: ¥449,820

24,000460,000

20,000400,000

16,000340,000

Offer price at additional offering: ¥272,440

12,000280,000

Offer price at additional offering: ¥237,160
8,000

220,000

Offer price at IPO: ¥200,000

4,000

Offer price at additional offering: ¥194,610
160,000
Offer price at additional offering: ¥168,1010

100,000

Jun. 14 Jul. 1 Jan. 6 Jul. 1 Jan. 5 Jul. 1 Jan. 4 Jul. 1 Jan. 4 Jul. 3 Jan. 4 Jul. 2 Jan. 4 Jul. 1 Jan. 5 Jul. 1 Jan. 4 Jul. 1 Jan. 4 Jul. 1 Jan. 4 Jul. 2 Jan. 4 Jul. 1 Jan. 6 Jul. 1 Jan. 5 Feb. 3
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2002
2003
(Note) Unit prices are based on closing prices.

Breakdown of Unitholders (as of December 31, 2014)
Other domestic
corporations

Foreign investors

345

198

(2.91%)(1.67%)

Individuals

36,973 units

Foreign investors(4.48%)

207,057 units(25.09%)Financial institutions(including securities firms)

Number ofunitholders
by investor type(1.27%)

11,836151

Number ofinvestment units
by investor type

Other domestic
corporations

825,000
units

83,110 units(10.07%)

Individuals

Financial institutions(including securities firms)(94.13%)(63.34%)

497,860 units

11,142(Note) The composition ratio is rounded to the second decimal place.

Annual Schedule (Provisional)
December

September

Sending of asset management report for the fiscal period ending June
Start of cash distributions for the fiscal period ending June
Information disclosure

AugustAnnouncement of financial results
for the fiscal period ending June

June

Fiscal term ends

on the website as
appropriate

March

Fiscal term ends

February

Announcement of financial results
for the fiscal period ending December

Start of cash distributions for the fiscal period ending December
Sending of asset management report for the fiscal period ending December

75Notice Concerning Withholding Tax Rate on Dividends of Listed Stocks, Etc.
Please be informed that the concessionary tax rate imposed on dividends and distributions of listed stocks, etc.
was abolished as of December 31, 2013, and the ordinary tax rate is applicable for dividends and distributions oflisted stocks, etc. to be paid on or after January 1, 2014. For reference, the special income tax for reconstruction isapplied for dividends and distributions for the 25-year period from January 1, 2013 through December 31, 2037 at
the rate of 2.1% on the applicable income tax liability.
The withholding tax rates on dividends and distributions of listed stocks, etc. to be paid on or after January 1, 2014 are as follows.

Income tax
Special income tax for reconstruction
Resident tax
Total

From January 1, 2014
to December 31, 2037

From January 1, 2038
and thereafter

15%

15%

0.315%—

5%

5%

20.315%20%⃝ Resident tax is not levied on corporations.

⃝ This notice is meant to provide general information regarding taxation on dividends and distributions of listed stocks, etc., and there may be cases in which the content of this notice is notapplicable. For details, please inquire at the nearest tax office, with a tax accountant or other specialist.
⃝ This notice has been prepared based on the information available as of January 2015.

Notes for Investors
Fiscal Period Ends

June 30 and December 31 of each year

General Meeting of Unitholders

More than once every two years

Base Date of General Meeting of Unitholders The date designated pursuant of JPR’s Articles of Incorporation
Cash Distribution Payment Eligibility
Transfer Agent

Unitholders of record as of June 30 and December 31 of each year
Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo
Main Branch, Stock Transfer Agency Division

Location of Records

Mizuho Trust & Banking Co., Ltd.
2-1 Yaesu 1-chome, Chuo-ku, Tokyo
Stock Transfer Agency Division

Mailing Address

Mizuho Trust & Banking Co., Ltd.
2-8-4 Izumi, Suginami-ku, Tokyo 168-8507

Contact by Phone

0120-288-324

Listing

Tokyo Stock Exchange (Securities Code: 8955)

Procedures for Change of Address
For filing or inquiring about a change of address, please contact your securities company with whom you have an account.
For unitholders who have not utilized Japan Securities Depository Center, Inc. before the dematerialization of stock certificates, accounts (special accounts)
have been opened at Mizuho Trust & Banking Co., Ltd., JPR’s transfer agent. For filing or inquiring about a change of address and other matters with regard
to your special account, please direct them to the contact number indicated above.
Cash Distributions
Cash distributions can be collected by bringing the “unitholder dividend receipt” to the nearest Japan Post Bank main or branch office, sub-branch office orpost office (bank agent) in Japan. If the collection period has elapsed, please make your collection by designating the collection method on the back of the“unitholder dividend receipt” and mailing it to Mizuho Trust & Banking’s Stock Transfer Agency Division. Cash distributions can also be collected at themain or branch offices of Mizuho Trust & Banking (excluding the Trust Lounge) and Mizuho Bank, Ltd.
If you wish to designate a transfer of cash distributions to a bank, etc., please contact your securities company (if you have an account with the company) or
Mizuho Trust & Banking (if a special account has been opened), as in the case of changing the address, etc. above.
(Note)	According to the provisions of JPR’s Articles of Incorporation, cash distributions will become irretrievable if they remain unclaimed for three full years from the date on which payment commenced.
We advise that cash distributions be received as soon as possible.