36th
Fiscal Period

Securities code 8955

Presentation Material
For the 36th Fiscal Period
Ended December 2019Japan Prime Realty Investment Corporation(Asset Manager)
Tokyo Realty Investment Management, Inc.

Table of Contents and Disclaimer

Disclaimer

Table and Contents
1. Characteristics of JPR

2p

2. Public Offering Highlights

4p

3. Operational Status and Growth Strategy

10p3-1. Summary of Financial Results

11p

3-2. Internal Growth Strategy

12p

3-3. External Growth Strategy

17p

3-4. Financial Strategy

19P

3-5. Sustainability

20p

4. Financial Results and Operating Forecasts

25p

5. Appendix

34p

6. Glossary

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

Cover photograph：Sencity Bldg. and Minami Semba Bldg.

1

JAPAN PRIME REALTY INVESTMENT CORPORATION

1. Characteristics of JPR

2

1. Characteristics of JPR

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

Japan Prime Realty Investment Corporation(abbreviated as JPR)

Securities code

8955

Listing dateJune 14, 2002 (17.5 years since listing)End of fiscal
periodJune and December

Operational
standard of
portfolio(Ratio by asset class)
Office 70～90% / Urban Retail etc. 10～30%(Target investment
ratio)

Asset Manager

Sponsors(shareholding
ratio)(Ratio by area)
Tokyo 80～90% / Other cities 10～20%

Tokyo Realty Investment Management Inc.
(abbreviated as TRIM)

Tokyo Tatemono (52%)
Yasuda Real Estate (18%)
Taisei Corporation (10%)
Sompo Japan Nipponkoa Insurance (10%)
Meiji Yasuda Life Insurance (10%)■Characteristics of JPR
track record of stable management for over 17
1 Ayears
Since listing, JPR has steadily expanded its asset size while enhancing the qualityof its portfolio.

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

3 Superiority of a developer-sponsored REIT

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

internal growth through high occupancy
4 Continuous
rate and upward revision of rents
The average occupancy rate of the entire portfolio has stayed at 97% or higher
since the 26th fiscal period ended December 2014, and upward revision of rents
continued to surpass downward revision by value for 11 straight fiscal periods.

(assumption as of March 2020)

Asset size
(After the asset replacement)

65 properties 457.1 bn. yen
Ratio by asset(After the asset replacement)(Area)

Tokyo(Asset class)

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

335.3 bn. yen・ 73.4 %Upward revision of rents

11 consecutive fiscal
periods(Dec. ’14 ～ Dec. ’19)

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

84.5 %
77.1 %

LTV

39.6 %
Ratio of long-term, fixed interest rate debts

100.0%
Credit rating

1. Each of the figures for “number of properties / asset size,” “ratio by asset,” “(planned) acquisition price and ratio of properties from sponsor
pipelines,” “LTV” and “ratio of long-term, fixed interest rate debts” is an estimated figure as of March 31, 2020.
2. Properties from sponsor pipelines refer to properties acquired from sponsors, etc. and properties acquired based on information provided bysponsors. Sponsors, etc. represent the five sponsor companies of JPR, their affiliated companies and special purpose companies (SPCs) in which thesponsors have made equity investment. Ratio of properties from sponsor pipelines refers to the ratio of (planned) acquisition price of properties
from sponsor pipelines over the total (planned) acquisition price of the entire portfolio.

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

3

JAPAN PRIME REALTY INVESTMENT CORPORATION

2. Public Offering Highlights

42. Public Offering Highlights

Summary of Public Stock Offering■ Purpose and Effectof the portfolio through acquisition of blue-chip
1 Growth
properties utilizing sponsor pipelines

improvement in unitholder value through growth of
3 Further
distribution per unit and NAV per unit

Acquired assets
35th fiscal period (Jun. 2019)37th fiscal period (Jun. 2020)
Minami semba
JPR Kojimachi Bldg. FUNDES Ueno
Sencity Bldg.
Bldg.

Dec. 2019

Jun. 2020

Dec. 2020（actual）（forecast）（forecast）

EffectMedium-termtargetGrowth up 3.0%

DPU

Main sponsor

Main sponsor

Main sponsor

Sponsor

Jun. 27, ‘19

Jun. 27, ‘19Jan. 30, ‘20

Mar. 37, ‘20

Acquisition price5.75 billion yen

3.8 billion yen

3.75 billion yen

13.87 billion yen

Appraisal value

6.41 billion yen
4.0%

4.0 billion yen
4.0%

3.97 billion yen
4.9%

14.6 billion yen
5.4%

Acquisition date

NOI yield
After-depreciation
yield

3.6%

3.2%

4.2%

4.3%

SellerTokyo TatemonoTokyo TatemonoTokyo Tatemono

Taisei-Yuraku Real Estate

Asset size
After-depreciation yieldEnd of Dec. 2019

Effect439.5 billion yen

457.1 billion yen
4.2%(end of Jun. ’20 (forecast))

4.1%

control of LTV and increase in capacity to acquire
2 Stable
properties
As of Feb. 14, ‘20
LTV
Acquisition capacity(maximum LTV of 45%)

Effect(end of Mar. ‘20 (forecast))

41.3%

39.6%

30.6 billion yen

46.5 billion yen

7,493 yen
End of Dec. 2019（actual）

NAV per unit

368,917 yen

7,590 yen

7,720 yen

7,800 yen

Effect373,409 yen■ Issue Overview
Offering style

Domestic offering

Total purchase price (plan)

17,012 million yen (including allocation to third party)

New total number of units (plan)
Number of units outstanding after
public offering (plan)
Issue price, Purchase price

37,000 units (including allocation to third party)

Discount rate

2.0%

Bid-to-cover ratio

16.8 times

960,000 units
474,810 yen/unit, 459,790 yen/unit

Resolution date for issue / Determination
Feb. 14, ‘20 / Feb. 26, ‘20
date for issue condition

Payment date / Delivery date (PO)Mar. 3, ’20 / Mar. 4, ‘20

1. Each of the above figures is premised on the assumption that application and payment are made for the entire number of investment
units issued by the third-party allotment.

5

2.
PublicOffering Highlights
2-2.
内部成長戦略

Properties to be acquired in 37th [Sencity Bldg.]

A large-scale, high-rise office building directly connected to Chiba Station to be acquired from a sponsor■ Acquisition Highlights
The property is a large-scale office building with the highest
degree of rarity in all aspects, including its overwhelmingly
superior locational advantages and scale, convenience, highvisibility and landmark characteristics.

Location

1000, Shinmachi, Chuo-ku, Chiba-shi,
Chiba, etc.

Asset Class

Office / Retail

Floors

B2/23F

AcquisitionPrice

13,870 million yen

Appraisal Value

14,600 million yen（Unrealized gain 730 million yen）

Yield

（NOI）
（After-depreciation yield）

4.9%
3.9%

（Appraisement）（NOI）（After-depreciation yield）

5.4%
4.3%

Total Leasable
Floor Space

13,212.98㎡

Occupancy Rate

99.1％ （as of acquisition date）

Acquisition Date

Mar. 27, ’20 (plan)

Ownership
interest

12.4% (Sencity Bldg.)(assumption）

Yield• Directly connected to Chiba Station, the center of Chiba, which isserviced by the JR lines, the Keisei Line and the Chiba Urban
Monorail• A large-scale, multi-story (23 stories) office building with a 352tsubo floor plate• High user-friendliness achieved through integrated developmentwith large-scale commercial facilities• Excellent common-use areas that accommodate tenant needs and
BCP support using a 72-hour emergency power generator and otherequipment• A wide variety of tenant needs are estimated, including large
companies’ branch offices that cover the Chiba area, self-contained
type tenants and tenants with end users’ visits to stores.
• The market situation is to be ascertained based on the
management of the JPR Chiba Building which is an existing owned
property.
Rare location directly connected
to Chiba Station

Entrance with openness

Sencity Garden

Refresh corner

6

2.
PublicOffering Highlights
2-2.
内部成長戦略

Properties to be acquired in 37th [Minami Semba Bldg.]

Property in an ideal location in the Shinsaibashi area, an excellent commercial area in Osaka, to beacquired from the main sponsor■ Acquisition Highlights• Located three minutes’ walk from Shinsaibashi Station on the
Midosuji Line and the Nagahori Tsurumi Ryokuchi Line of the Osaka
Metro and four minutes’ walk from Yotsubashi Station on the
Yotsubashi Line, the property also has convenient access to Umeda
Station, Shin-Osaka Station and Namba Station.

• A vibrant commercial area with numerous retail stores, including
department stores and brand stores on Mido-Suji Street andshopping centers on Shinsaibashi-Suji Street• In addition to standard office needs, needs from tenants withcustomers’ visits to stores are anticipated.
• An area with a high degree of rarity in terms of office space, with avery low level of new supply• High level of competitiveness to be maintained through theimplementation of renovations to the exteriors and common-use
space

Tenants
From 2F to 8F
OfficeFrom B1 to 1F
Luxurious apparel

The first store in westernJapan in which eight Issei
Miyaka brands aregathered in one location

Location

11-28, Minamisemba 4 chome,
Chuo-ku, Osaka

Asset Class

Office / Retail

Floors

B1/8F

Acquisition Price

3,750 million yen

Appraisal Value

3,970 million yen（Unrealized gain 220 million yen）

Yield
(assumption）（NOI）（After-depreciation yield）

4.7%
3.9%

Yield
（Appraisement）
Total Leasable
Floor Space（NOI）（After-depreciation yield）

4.9%
4.2%

Occupancy Rate

99.9％（as of acquisition date）

Acquisition Date

Jan. 30, ‘20• Rents for existing office space contracts are lower than market
average levels, and upside rent potential is estimated.
• The market situation is to be ascertained based on the managementof the JPR Shinsaibashi Building and existing owned properties.

Entrance hall

Elevator hall

5,695.71㎡

7

2. Public Offering Highlights

Actual and Target of DPU

Distribution per unit has continued to increase steadily over a long period of time.
Existing target of 7,500 yen is expected to be reached in Jun. ‘20 period
Set new target of 7,800 yen and aim for further growth[Growth policy] Stable growth of cash distributions/ Disciplined expansion of asset size /Further improvement of portfolio quality■ Results and Medium-Term Target of Distribution per Unit
Aug. 19, ’19 (released)

Existing target 1

Existing target 2
Growth to 7,500 yen
Achievement expected inJun. ’20 period

Growth to 7,300 yen by Jun. ’19 period
Achieved early in Dec. ’18 period

New target
Growth to 7,800 yen

7,800

8,000
（yen/unit）

7,500

7,213

7,223

7,245

Jun. '17

Dec. '17

Jun. '18

7,326

7,380

Dec. '18

Jun. '19

7,493

7,590

7,720

7,048
7,000

6,756

6,500

6,000
0

Jun. '16

Dec. '16

Dec. '19

Jun. '20(forecast)

Dec. '20(period)(forecast)Target

1. Distribution per unit as medium-term target is a management target set by TRIM, and there is no guarantee that the figure is achieved.

82. Public Offering Highlights

Medium-term Target

Simulation of DPU Growth■ Target contributions to distributions of each growth driver
Contribution to distributions(per unit)

Growth drivers

Internal growth

1% growth in rents and common charges (per annual rate)* Assuming that balance of rents and common charges grewat annualized rate of 1% in Dec. ’19 period(用途)

Around 67 yen(エリア)

External growth

Assuming acquisition of 10 billion yen property with after
depreciation yield of 3.3% (not including financing costs)

Around 172 yen

Financial strategy

0.01% reduction in average cost of debt (per period)* Result of most recent year was reduction of 0.05% perperiodAround 9 yen■ Other major factors that affect DPU• Increase or decrease in incidental income such as land rent andparking lot income• Increase in management expenses• Balance of utilities expenses• Increase in property taxes and other property costs• Increase or decrease in repairs and maintenance and depreciation■ Estimated increase in DPU as a result of property acquisition
After depreciation yield (%)

Acquisition
cost(billion yen)

3.0

3.1

3.2

3.3

3.4

3.5

3.6

5

78

81

83

86

89

91

94

10

156

161

167

172

177

182

188

15

234

242

250

258

266

273

281

20

313

323

333

344

354

365

375

1. The above figures are TRIM’s estimates of the impact of various measures on performance based on certain assumptions and TRIM makes no guarantee whatsoever concerning the achievability of the figures or the amounts and timings
2. Contribution to distributions is the estimated increase in distributions over the period based on various assumptions divided by the number of investment units outstanding at the end of Mar. 2020.
3. “Estimated increases in DPU as a result of property acquisition” does not include financing cost.

9

JAPAN PRIME REALTY INVESTMENT CORPORATION

2. Operational Status and Growth Strategy

103-1. Summary of Financial Results

Business Environment Perception, results and outlook

Outlook

Results

Business
environment
perception

Plans for the fiscal period ended December 2019 progressed steadily thanks to a buoyant office property
leasing market.
At the beginning of 2020, JPR undertook the public offering of new investment units for the first time inthe last three years to fund property acquisition.
Internal Growth Strategy

External Growth Strategy

Financial Strategy• Office demand from companies is still robust.
• Leasing of large-scale office properties scheduled forcompletion by 2020 in Central Tokyo appears to be
progressing steadily• Vacancy rates in Central Tokyo fell to a historically low
level, and rents also continued to rise.
• The supply and demand balance continued to tighten in
major regional cities as well.

• Real estate prices in Central Tokyo have mostly reachedthe upper limit• Continuously properties in regional cities are also hard toacquire at appropriate prices, with their cap rates dropping
further• Despite persistently low interest rates, fluctuations in themarket are likely due to global risk events.
• Due to mounting political and economic risks worldwide,
the monetary easing policies of the BOJ, FRB and ECB are
more aligned.
• The level of attention in ESG is rising rapidly among
stakeholders.

• Occupancy rate based on concluded contracts
99.5%(previous period 99.2%)• Upward revision upon contract renewal (monthly rent,net)+12.3 million yen• Acquired Minami Semba Building from Tokyo Tatemono
Co., Ltd. in January 2020.
• Sencity Building is scheduled to be acquired from TaiseiYuraku Real Estate Co., Ltd. in March 2020 (contractconcluded in February 2020).

[Debt procurement result in the 35th fiscal period (short-termloans excepted)]• Average maturity(Before refinancing)6.5 years ➔• Raising of rents upon tenant replacement (monthly rent,net)+11.4 million yen• Occupancy rate based on generated rents raising 98.9%.
• The revision of rents made progress as planned.

• There are concerns about the possible impact that the newcoronavirus disease COVID-19 will have on the Japaneseand global economies.
• The favorable market environment is assumed to continue.
• The properties owned by JPR are expected to maintainhigh occupancy rates, and the revision of rents isanticipated to make steady progress.
• Aim to maintain growth pace by maintaining andimproving building competitiveness and improving tenant
relations(After refinancing) 8.4 years• Average debt interest rate

(Before refinancing) 0.93% ➔ (After refinancing) 0.48%• Acquisition of Top 5-Star Rating in GRESB Survey• Continue selective investments with a focus on theirlocation and quality, with the aim of increasing the asset
size.
• In February 2020, Tokyo Tatemono Co., Ltd. announced a
new medium-term management plan.
• Examine acquisitions focusing on sponsors’ pipelines forthe time being.

• JPR issued Green Bonds for the first time in July 2019
Issue amount: 5,000 million yen
Maturity: 10 years• Continue refinancing with an emphasis on lengthening
borrowing periods while endeavoring to reduce interest
costs.
• Diversify funding methods and ensure short-term liquidity
to enhance refinance risk tolerance.

11

Status of Rent

3-2. Internal Growth Strategy

Vacancies were filled quickly and high occupancy was maintained.
Occupancy rate are expected to remain stable at a high level in and after the Jun. ’20 period.
■ Move-Ins/Move-Outs■ Occupancy Rate

(Change in move-in/ move-out spaces and forecast)Occupancy rate based on concluded cntracts
Occupancy rate based on generated rents
99.5

（%）

100

99.2

98.3

98.5

98.4

98.2

98

97.3

97.6

99.2

98.3

97.9

98.6

98.9

99.5
99.4

99.2
99.1

End of Jun. ’19 period
Vacancyspace

Dec. ‘19
move-in/move-out net
space

End of Dec. ’19period
Vacancyspace

Jun. ‘20
Assumed movein/move-out net
space

End of Jun. ‘20 period
assumed vacancy
space6,559 m2

-4,440 m2

2,125 m2

790 m22,916 m2

(Move-in/ move-out spaces)
Move-out

Move-in（㎡）（period）

96.9

96

8,063

'19.12'20.6

94

The most recent
5-period average
9,112 m2

2,620

12,504The most recent
5-period average
10,656 m2

1,984（forecast）(Major move-in/move-out properties)
920

Jun. '20

Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 Jun. '20 Dec. '20 （period）（forecast）-1,205

2,445

-925

925

JPR Sendagaya Bldg.

-817

817

Shinjuku Square Tower-484 -707

707

Kanematsu Bldg.
Yume-ooka Office Tower（month）

6
3

1.9

1.8

2.0

1.5

1.8

1.0
0.8
Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 Jun. '20 （period）

Dec. '19
Move-in（forecast）■ Average rent free period0Dec. '19
Move -out-903（period）（㎡）

521

Tachikawa Business Center Bldg.

-633 528 90

Kawaguchi Center Bldg.

-563 132 195（forecast）
1. Occupancy rate based on concluded contracts and occupancy rate based on generated rents represent period-average figures.
2. The figures for the occupancy rate based on concluded contracts and the occupancy rate based on generated rents for the 37th fiscal period (Jun. ‘20)
are estimates that reflect consents regarding move-ins and move-outs that will become effective in the fiscal period. The respective figures for the 38th
fiscal period (Dec. ‘20) are estimates based on assumptions by JPR regarding move-ins and move-outs becoming effective in the fiscal period.

Jun. '20

12

Status of Rent

3-2. Internal Growth Strategy

With steady progress made in upward revision of rents and raising of rents upon tenant replacement,
office rents continued to increase■ Rent Revisions
Dec. ‘19

Upward revision amountRate of upward revision

Ratio of contracts with upwardrevision+13.4 million yen (monthly rent)

+7.8%

48.0%

Upward revision (left axis)
Downward revision (left axis)
Rate of upward revision (right axis）(million yen)

+30

■ Rent upon Tenant Replacement (increase/decrease of rent through tenant replacement)

7.6

7.4

7.5

6.8

7.8

Upward revision
undernegotiation: 2.5
million yen

Dec. ‘19(%)(million yen)

9+20

Increase in monthly rent upontenant replacement

Rate of increase inrent upon tenant replacement

Ratio of contracts with increase inrent upon tenant replacement+12.9 million yen(monthly rent)+18.9%

94.9%

Downward revision (left axis)
Upward revision (left axis)
Rate of increase in rent upon tenant replacement (right axis)

27.6
21.1

5

30

23.7
18.9

16.0

+15

+20

(%)

20

+10

10

+5

0

+10
+10.0

+23.2

+7.4

+17.1

+13.4

+21.5

+0
-3.9

-3.0

-0.2

-1.9

-1.1

Dec. '17

Jun. '18

Dec. '18

Jun. '19

Dec. '19

-10

1

+3.7

+9.0

+7.2

+6.9

+12.9

-1.0

-4.7

-0.6

-1.8

-1.5

Dec. '17

Jun. '18

Dec. '18

Jun. '19

Dec. '19+0-3Jun. '20 （period）-5（forecast）(Ratio of contracts with upward revision)(No. ofcontracts)

Number of contract
renewals (left axis)

Ratio of contracts withupward revision (right axis)
（%）

80
44.6

45.9

48.1

51.9

0
'18.6

'18.12-20
Jun. '20 （period）（forecast）'19.6(No. ofcontracts)

50

48.0

40

25

0
'19.12 （period）

0100'17.120-10(Ratio of contracts with increase in rent upon tenant replacement)

Number of contracts withupward revision (left axis)

200

+1.6

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

Number of tenant
replacements (left axis)
Ratio of contracts with increase
in rent upon tenant replacement (right axis)

67.6

61.0

76.9

Number of contracts with increase
in rent upon tenant replacement (left axis)

94.9
75.0

（%）

100
50

'17.12'18.6'18.12'19.6

0'19.12 （period）

13

Status of Rent

3-2. Internal Growth Strategy

With rents still being revised upward, the gap in rents will widen further due to solid demand.
■ Status of Gap in Rent (Office)■ Status of Average Rent (existing office properties, all area)（yen/tsubo）+60
Higher than market
rent（million yen）

Lower than market rent

Higher than market range (new contract, etc.)

19,000Within market range

Higher than market range (except for new contract)

18,000

Ratio by period-on-period

+1.0%

+40

+0.4%

+1.6%

+0.7%

+1.7%

+1.2%

17,00016,000+20

15,000+0Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 （period）
Gap in rents

Lower than market
rent

-20

6.9.

-40
-60
Jun. '20

Dec. '20

Jun. '21

Dec. '21（period）%(period-on-period
comparison -1.8%)(Reference)
Gap in actual rents-12.8%(period-on-period-2.4%)◼ Percentages of space◼ Ratio of change in upward revisionby the time of contract renewal
Jun. ‘22 fiscal
period later

8%Dec.’21 fiscal
periodJun.’20 fiscal
periodThree times
13%

22%

Twice
31%

Jun. ‘21 fiscal
period25%

Central Tokyo

Greater Tokyo

Other cities（yen/tsubo）

23,00021,000

Ratio by period-on-period

+2.8%

+1.4%

+1.5%

+0.3%

+1.0%

+0.7%

+0.6%

+0.3%

+1.4%

+0.5%

+0.3%

+0.8%

+3.8%

+0.9%

+1.5%

+1.5%

19,00017,00015,00032%

Total 83
contracts■ Change in Average Rents by Area (existing office properties)

Once
55%

Dec.’20 fiscal
period13%

1. “Market rent” and “Market range” refers to rent level set by TRIM for office buildings held by JPR based on assessment of CBRE Inc. and advice
from Tokyo Tatemono.

13,000

+0.3%

+0.9%

11,000Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19（period）
1. “Existing office properties” refer to properties held continuously since the Dec. ‘16 period.
2. Average rent indicates the assumed average rent at full occupancy.

14

3-2. Internal Growth Strategy

Internal Growth Initiatives

On top of measures to achieve continuous raising of rents and effective value enhancement, energeticallyendeavor to reduce expenses■ Basic Strategy■ Changes in Construction Costs and Depreciation(million yen)

1. Strategically utilize target rents
Set target rents, the target for raising rents for new contracts
and contract renewals, for respective office properties. Byclarifying the target, aim to conduct strategic negotiations forraising rents and maximizing rents upon tenant replacement

Depreciation

Capital expenditures

Repairs and maintenance
修繕費

2,500
2,000

1,921

1,943

1,943

1,965

2,035

1,973

2,100
2,047

1,805

1,500

1,582

2. Reinforce investments for value enhancement
In addition to reinforcing property competitiveness, proactively
invest in interior fittings and facilities, etc. that meets tenantneeds, with an intention to raise rents for new contracts

1,000
500

1,146
624 306

383

1,126
505

1,325
523

563

593

542

0

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

4. Increase NOI by reviewing property management
and operation methods
Review property management and operation methods while
paying attention to maintaining and improving the management
quality, in an effort to promote reduction of rental expenses andincreasing incidental revenues

Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 Jun. '20 Dec. '20 （period）（forecast）（forecast）■ Summary of Construction Works and Properties (Dec. ‘19)

• Total construction costs
2,198 million yen=>Of which, works of value
1,036 million yen
enhancement=>(Of which, works to switch
154 million yen JPR Musashikosugi Bldg. JPR Ningyocho Bldg.
to LED lamp, etc.)
Renovation of exterior walls Renovation of the entrance◆JPR Musashikosugi Bldg. (267 mn. Yen exterior walls, interior fittings etc.)◆JPR Umeda Loft Bldg. (149 mn. yen ESL etc.)◆Tokyo Tatemono Honmachi Bldg. (158 mn. Yen interior fittings / airconditioning, etc.)◆Kawaguchi Center Bldg. (146 mn. yen airconditioning, etc.)

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

15

Status of Occupancy Rate and Lease Contract in Retail properties

3-2. Internal Growth Strategy

JPR’s retail properties are situated in prime locations or in areas close to stations and with highcommercial potential
The occupancy rate remains stable at almost full occupancy.
■ Retail Portfolio■ Occupancy Rate (Retail properties)
（%）

Type

Urban type

Station-front type

Characteristics

Urban retail properties situatedon prime locations in Tokyo andOsaka

Retail properties located in frontof stations near Tokyo and inmajor regional

Number ofproperties
Asset size

9 properties
58.5 billion yen

6 properties
46.1 billion yen(acquisition price)

100.0

100.0

99.7

99.9

99.9

99.6

100.0
98.0
96.0

94.0
0

99.4
99.2

99.9
99.4

99.9

100.0

100.0

100.0

99.8

99.9

100.0

100.0

Dec '19

Jun '20

Dec '20 （period）（forecast）（forecast）

Occupancy rate based on concluded cntracts
Occupancy rate based on generated rents
Dec '16

Jun '17

Dec '17

Jun '18

Dec '18

Jun '19■ Status of Lease Contract (Retail properties)
Type of tenant (space ratio)
Type of rent (space ratio)■ Main Retail properties

Fixed rent + Commission

Urban type5%
Multi tenants

23%

JPR Umeda Loft Bldg.

JPR Shibuya
Tower Records Bldg.

JPR Ginza
Namiki-dori
Bldg.

Yurakucho
Ekimae Bldg.
(Yurakucho Itocia)

FUNDES
Ueno

Type of contract (space ratio)

Station-front
type

Fixed rent

Entire building
77%
一棟

Fixed-termbuilding lease

13%

95%
固定

Remaining contract period(space ratio)
Less than
2 years

28%

42%

5 years
or more2 years or more andless than 3 years
Kawasaki Dice Bldg.

Tanashi ASTA

1. Asset size is calculated based on acquisition price.

JPR
Musashikosugi
Bldg.

Housing Design
Center Kobe

1%
Ordinary普通借家
building lease87%

3 years or more andless than 5 years

28%

16

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

Vigorously selective investments with a focus on quality

Utilize preferential negotiation rights and pipelines of the sponsors and promote strategic asset replacement■ Basic Investment Policy■ Continue External Growth by Utilizing Asset Replacement（Investment standard of portfolio）(Asset replacement policy)• Aim to build a strong and solid portfolio by promoting asset replacement.

(Area)

Investment
standard(Asset)JPR

OfficeUrban Retail
Property, etc.

Tokyo

Others70 ～ 90 %10 ～ 30 %80 ～ 90 %10 ～ 20 %Sponsors• Enhance the quality of the portfolio
and profitability through strategicalasset replacement.
• Rejuvenate the age and improve
profitability.
• When properties are sold to thesponsor, discussion on acquisition
after the properties are redevelopedby the sponsors is possible throughpreferential negotiations.
• Conduct vigorously selective
investment at assumed fair value.

■ Addition of hotels (urban accommodation properties) to asset classes[Purpose]• Achieve sustainable growth and improve unitholder value by increasing investment
opportunities.

Strategically saleAssetreplacement

Acquiring blue-chipproperties• Sponsors who are developers haveneeds to acquire properties to be redeveloped.
• The main sponsors support expansionof JPR as part of their strategy toreinforce the comprehensive strengthsof the groups and enhance theirbusiness portfolio.
• Further reinforcement of the sponsor
commitment to JPR’s growth strategy.

[Management strategy]• Focus on earning stability.
• Conclude long-term lease agreements generally with fixed rent with outside specialists, etc.
who have proven track records in operating hotels.

■ Investigation of acquisitions through negotiated deals(Utilizing sponsor pipeline)(Largest top 5 properties)■ Utilizing preferential negotiation right
Ratio of co-owned properties, etc.
(existing preferential negotiation right)

Full ownership

33 properties
189.1 billion yen

Co-owned properties(not preferential
Negotiation right)

9 properties 59.8 billion yen

Co-owned
properties, etc.
(existingpreferential
negotiation right)

Ownership
interest on
initialacquisition

Additional
acquisition

Current
ownership
interest

45.6%

4.6%

50.2%

Tokyo Square Garden

－

－

8.22%

Shinjuku Square Tower

38.9%

+28.5

67.4%

Property

21 properties Shinagawa Canal Bldg.
190.4 billion yen

43.3％

Property

Example of main acquisition utilizing
Preferential negotiation rightShibadaimon Center
Bldg.
Shinyokohama 2nd
Center Bldg.
BYGS Shinjuku Bldg.

Properties acquired
other than fromsponsors
121.7 billion yen

Properties
acquisition fromsponsors
27.7%
219.4 billion yen
Properties acquired 49.9%
based on information
provided by sponsors
98.2 billion yen
Properties

22.4%

52.8%

+12.6%

65.4%

acquired using
sponsor pipelines

50.0%+50.0%

100%

72.3%

25.0%

+75.0%

100%

1. Tokyo Square Garden was acquired by utilizing the preferential negotiation right of Tokyo Tatemono and the otherproperties were acquired by utilizing the preferential negotiation right of JPR.

Billion yen

1Otemachi Tower

2

Olinas Tower

31.3

3

Shinjuku Center Bldg.

21.0

4

Tokyo Square Garden

18.4

5

Kanematsu Bldg.

16.2(land with leasehold interest)

36.0

All are properties acquired using
sponsor pipelines or properties
developed by the sponsors.

17

Utilization of Sponsor Pipelines

3-3. External Growth Strategy

Properties owned and examples of development projects by Tokyo Tatemono Co., Ltd.
■ Properties owned by Tokyo Tatemono Co., Ltd.
in the vicinity of Tokyo Station
Name

Completionyear

Otemachi Tower

2014

Otemachi Financial
City Grand Cube
JA Building,
Keidanren Kaikan
Otemachi Financial
City North Tower
Tokyotatemono
Takaracho Bldg.
Tokyo Tatemono No. 3
Takaracho Bldg.
Nihombashi TI Bldg.
Tokyo Tatemono
Nihombashi Bldg.
Nihombashi First Bldg.

2016

Shin-gohukubashi Bldg.
Tokyo Tatemono
Yaesu Bldg.
NTA Nihombashi Bldg.

1977
2011

Tokyo Tatemono
Yaesu-sakuradori Bldg.
Tokyo Tatemono
Head Office Bldg.
Yaesumeg Bldg.

1974

Kyobashi YS Bldg.

1990

Empire Bldg.
Kyobashi EdograndBldg.
Fukuoka Bldg.

2017

Tokyo Square Tower

2013

Tokyo Tatemono
Kyobashi Bldg.

1981■ Urban compact retail property, Urban hotel,
Medium-sized office
Asset class2009
Urban compact
retailproperties

2012

1966
NihoNihombashi
Mitsukoshi Main Store

1971

Tokyo Metro
Hanzomon Line

2012
2015
1994

Urban hotel

1991

Daimaru Tokyo
Department Store

1929

Tokyo Sta.

MaruzenBook Store
NihoNihombashi
Takashimaya
Department Store

1986

2016
1990

Completion/plannedcompletion

FUNDES Suidobashi (owned by JPR)

1,477

Jul. ‘ 15

FUNDES Ueno (owned by JPR)

2,249

Jul. ’17

FUNDES Gotanda

1,498

Jul. ’19

FUNDES Ginza

1,866

Nov. ‘19

Candeo Hotels Tokyo Roppongi

149

Sep. ’17

The Square Hotel Ginza

182

Aug. ’18

Hotel Gracery Asakusa

125

Sep. ’18

The b Osaka Midosuji

306

Feb. ’19

Candeo Hotels Omiya

321

Aug. ‘19

Arietta Hotel Kyoto

122

Dec. ‘19

106

Spring ‘21

Sendai Kakyoin Terrace

5,800

Jan. ‘20

FUNDES Gotanda Hotel Gracery Asakusa

Sendai Kakyoin Terrace(Name to be determined)Kyoto Shijo

Medium-sized
officeYaesu
Book Center

Total floor area (㎡)
No. guestroom（Hotel）

Property name

Owned by JPR

Tokyo
International
Forum

Kanematsu Bldg.
Kanematsu Bldg.
Annex
JR Keiyo Line

Construction completion:
Up to and including 2000
2009 - 20142015 and thereafter

Yurakucho
ItociaYurakucho Mullion

FUNDES Ueno

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

18

Establishing a strong financial base

3-4. Financial Strategy

Flattening of Repayment Amount and Reduction of Cost of Debts■ Lengthening of Maturity and Flattening of Repayment Amount for
300Each Fiscal Period to Around 10 Billion Yen■ Debt Procurement Results in the 36th Fiscal Period(short-term loans excepted, 13.0 billion yen)

Average maturity
Beforerefinancing

6.5

Years

+1.8

Average debt interest rate

After
refinancing

years

Beforerefinancing

8.4

0.93%

years

After
refinancing-0.44% pt

Jun. 2019

Dec. 2019

Change11.1 bn. yen

13.0 bn. Yen+1.9 bn. Yen

Average maturity (change)

9.4 years

8.4 years-1.0 years(+2.0 years)(+1.8years)

0.56%

0.48%

(-1.11%pt)(-0.44%pt)-0.08% pt

185.0 bn. Yen

185.0 bn. Yen-

Average maturity

4.5 years

4.6 years+0.1 years

Average debt cost

0.87%

0.80%

-0.07%pt

Ratio of long-term, fixed interest
rate debts

98.9%

99.5%

+0.5%pt

Acquisition capacity(maximum LTV of 45%)

50

100
110

0

30

20
98

100 105

85

130

80

80

80

70

100

99

100

50

30

50

30

90

80

71

42

40

Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun.（period）'20 '20 '21 '21 '22 '22 '23 '23 '24 '24 '25 '25 '26 '26 '27 '27 '28 '28 '29 '29 '30■ Average Interest on Debt for Last Three Fiscal Periods and Average
Cost of Debts To be Matured
Average debt cost to be repaid by fiscal period

0.87%

0.96%

The average interest rate on borrowings
Jun. '20
直近3期平均forthe last three fiscal periods

Dec. '20

0.53%

0.66%

0.53%

0.55%

Jun. '21

Dec. '21

Jun. '22 （period）■ Change in LTV(LTV)
LTV (based on total assets)

Commitment line 24.0 bn. yen（100 million yen）

70

(Status of entire interest-bearing debts)
Total interest-bearing debts(as of Feb. 14, ‘20)

200

New debt

Average borrowing interest
rate (change)

Investment corporation bonds

0.48%■ Financial Indicators and Credit Rating Status(Status of Borrowings by Fiscal Period)

Long-term loans payable

(%)

40.9%

40.8%

-0.1% pt

33.7 bn. yen

34.6 bn. yen+0.9 bn. Yen(Credit rating)LTV

50
45 42.1

Control, aiming for maximum LTV of 40-45%

42.1

42.1

43.7

Dec '15

Jun '16

Dec '16

40.7

40.6

40.6

40.5

40.9

40.8

Jun '17

Dec '17

Jun '18

Dec '18

Jun '19

Dec '19 （period）

40

R&I

AA- (Stable)

S&P

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

35
Jun '1519

3-5. Sustainability

Sustainability

Seek to contribute to the sustainable growth of society■ Corporate philosophy of TRIM

■ Sustainability Promotion System
Sustainability Committee meets at least twice a year, with eye on sustainable growth.

TRIM provides value to all stakeholders, including customers, employees andSustainability committee

society, by rendering professional real estate investment management

President and CEO
CIO, CFO, CAO, Compliance Office generalmanager
Secretariat for Sustainability

services with sincerity and a sense of responsibility.

■ Sustainability Policy
Based on its corporate philosophy of working with integrity and commitment to
responsibilities, TRIM is resolved to contribute to the sustainable development ofsociety and the investment management business through discussion andcooperation with its stakeholders (including investors and tenants), while aiming
to maximize value for JPR's unitholders.
1.Initiatives on Behalf of Tenants
We will work with integrity and responsibility in responding to tenants, andendeavor to provide them with new and distinct values as well as enhancing
their satisfaction.
2.Initiatives on Behalf of the Environment
Recognizing the importance of addressing environmental issues, we will aim to
reduce environmental load through managing the assets owned by JPR.
・We will promote energy saving and reduction of greenhouse gas emissions.
・We will endeavor for effective use of water resources and work on the "3Rs"(reuse, reduce and recycle) of waste.
・We will strive to proactively disclose information on environmental issues.
3.Initiatives on Behalf of Local Communities
We will work to coordinate with local communities through managing the assets
owned by JPR, in an effort to contribute to enhancing the brand value of theentire area in which such assets are located.
4.Initiatives on Behalf of the Employees
We will respect each one of our employees to realize an employee-friendly
workplace, helping them to enhance abilities in their specialties.
5.Initiatives on Behalf of the Society
We will abide by laws and regulations as well as the rules of society, andconduct business operations with a focus on transparency and objectivity while
holding on to our high moral standards.

Members

Activities

Setting sustainability targets
Monitoring and assessing sustainability activities
Raising awareness among officers and employees

JPR’s board
ReportTRIM’s board■ Achieved "5 Star" the Highest Ranking in GRESB Evalution• Acquisition of the highest ranking of “5 Stars” rating in GRESB Rating,which is a relative rating based on overall score• Acquisition of “Green Star,” the highest ranking, for six consecutive
years• Acquisition of the highest ranking of “A” in ESG information disclosurelevel assessment.

■ Signing of the Principles for Responsible Investment (PRI)
TRIM supports the basic approach of the Principles of Responsible Investment(PRI) and became a signatory in May 2019.

20

3-5. Sustainability

Sustainability (Environment 1)

Promoted acquisition of environmental certification and issued Green Bonds■ Acquisition of environmental certification■ JPR’s first issuance of Green Bonds

Focus on improving rate of acquisition of environmental certification, aiming for
portfolio with low environmental impact and high sustainability
ItemJun. 2019

17

21

23

+2

Total area (㎡)

223,389

352,458

359,132

6,674• Contribute to expansion of green finance market

Ratio

34.0 %

53.4 %

54.4 %+1.0 %• Promote dialogue with investors interested in ESG investment

Number of properties

Dec. ‘20

Purpose of IssuanceDec. 2018

Change• Further promote ESG initiatives• Diversify and enhance fundraising methods(DBJ Green Building Certification)
Ranking

Property nameCriteria of Eligible Green Assets★★★★★

Tokyo Square Garden, Olinas Tower• DBJ Green Building Certification: 5 stars, 4 stars or 3 stars★★★★

Oval Court Ohsaki Mark West, Shinjuku Center
Bldg., JPR Sendagaya Bldg.

• CASBEE: B+ Rank, A Rank or S Rank★★★

Kanematsu Bldg., BYGS Shinjuku Bldg., Shinagawa
Canal Bldg., Omiya Prime East, Rise Arena Bldg.,
Yume-ooka Office Tower, Kawasaki Dice Bldg.

Overview of Green Bonds★★

JPR Crest Takebashi Bldg., Shinjuku Square Tower,
Minami Azabu Bldg., JPR Chiba Bldg.

(CASBEE for Building Certification)

Issue dateJuly 31, 2019

Total issue
amount5,000 million yen

Maturity

10 years

Ranking

Property nameInterest rate

0.57%

★★★★★

JPR Kojimachi Bldg., FUNDES Ueno, Musashiurawa
Shopping Square, JPR Umeda Loft Bldg., Housing
Design Center Kobe

Use ofproceeds

Repayment of funds borrowed for Yakuin Business
Garden and JPR Sendagaya Building★★★★

JPR Shibuya Tower Records Bldg., Yakuin Business
GardenEvaluation
organization

Obtained Green 1 (F) Rating , the highest possible,
in a “Green Finance Framework Evaluation” by
Japan Credit Rating Agency, Ltd. (JCR)21

3-5. Sustainability

Sustainability (Environment 2)

Reinforcing Continuous Improvement Initiatives on Environmental Issues■ Monitoring of energy management system■ CO2 Emission Data

Through the introduction of an energy management system in 2019, CO2 emission andutilities costs are monitored on a monthly basis in order to reduce the environmental burden.
(t-CO2)FY20184,000

FY2019

3,000

2,000

1,000
0

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

1. Excluded for not directly managed properties.

Item

Units

Electricity
Use

MWh/m2

Gas UseFY2017FY2018Change

0.153

0.149

-0.003

MWh/m2

0.024

0.024

0.000

Water Use

㎥/m2

0.832

0.800

-0.031CO2 Emission

t-CO2/m2

0.089

0.080

-0.009■ Construction Works for Reducing Environmental Load
Systematically implement refurbishment to highly energy-efficient facilities(Change in implement refurbishment to highly energy-efficient facilities■ Green Lease Contraction（million yen）

In new lease agreements, a green lease clause is prescribed to promote the reduction of
the environmental load in cooperation with tenants.

400
310
300

Case：Niigata Ekinan Center Bldg.

258
211

Conclude green lease agreements with environmentallyaware tenants.

200

227
185
130

(Points about conclusion of green lease agreements)• Reduction of CO2 emission and utilities costs throughreplacement with LED lighting

123

105

125

152

205
173

100

• Improvement of asset quality through the reduction of theenvironmental load
• Meeting the needs of environmentally aware tenants

368
339

0
Niigata Ekinan Center Bldg.

Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 Jun. '20 （period）（forecast）

LED construction

Work on air condition units223-5. Sustainability

Sustainability (society)

Initiatives for Enhancement of Tenant Satisfaction■ Enhancement of Tenant Services■ Initiatives Aimed at Employees

JPR Best Performance Award 2019： JPR Ichigaya Bldg.
• Awarded to outstanding building management companies as good examples forother properties since 2006
• Awarded based on tenant satisfaction, therefore, serving as an incentive toimprove satisfaction.
• Outstanding initiatives of recipient buildings are shared with those in charge ofother buildings to raise overall level of portfolio.

Real estate transaction specialist
ARES Certified Master
Real estate appraiserFirst-class architect
Certified public accountant
Securities Analysts Association of Japan（Reason for award）• Demonstrated strong coordination capabilities while
simultaneously dealing with construction work on thechangeover of retail unit tenants and the departure of tenants.

• Continuously attained a high evaluation in the CS survey,
attributable to favorable relationships maintained with tenants.

JPR Ichigaya Bldg.

• Finely tuned maintenance work for equipment was evaluatedas a model for other properties.

（Inspection Flow Chart for CS）

Conduct periodical questionnaires

Improvement ofmanagement issues
Improve problematic situations incooperation with property managers andbuilding managers of respective properties（as of Dec. 31 ‘19）

Name

（Recipient）
Tokyo Real Estate Management Co. Ltd.
JPR Ichigaya Bld. Branch OfficeTenant satisfaction survey
and inspection

Cultivating Professional （personnel development）• Considering that employees are the greatest management resources, TRIM supports
employees in taking on new challenges.
• To foster real estate investment management professionals, TRIM offers financial
aid for obtaining qualifications and training opportunities.
• TRI has developed education and training systems to support skill improvement.

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

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

No. of employees

34 employees
13 employees
4 employees
2 employees
1 employee
4 employees

Health and Well-being• The Tokyo Tatemono Group, the main sponsor, haspublished its Health Management Declaration and is
implementing a range of initiatives.
• TRIM was recognized as a Blue Chip Health-oriented
Company and awarded the Silver Certificate for Blue
Chip Health-oriented Companies.
• For health maintenance and enhancement, TRIM
provides health checkups, influenza vaccinations anddental checkups.
• Separately from paid leave, TRIM has developed a sickleave system for employees with illnesses and injuries.

23

3-5. Sustainability

Sustainability (corporate governance)

Endeavor to secure and enhance the soundness of business management as an investment
corporation and an asset management company that are reliable and trustworthy■ TRIM’s Corporate Governance■ Asset Management Fee
Change of AM Fee Structure• Fixed fees will be scrapped.
• Lower percentage of revenue-linked fee and shift to fee structure mainly
consisting of cash distribution-linked fee.

Management fees 4/5(Acquisition/Merger fee)
(Sale fee)

Distributable base amount
×3.8%×Rate of fluctuation of
distributable base amount per unit
Property value×0.5%

Acquisition

Management fee 3(Cash distribution-linked fee)

Conclude agreement

Total revenue×1.2%

Decision making on
acquisition
TRIM’s Board of Directors
over certain amountManagement fee 2(Revenue-linked fee)

Investment Subcommittee

Total acquisition price×0.05％

Final decision on
acquisition

Management fee 1(Asset-linked fee)

Compliance Committee
JPR’s Board of Directors

New AM Fee Structure （Change from Jun. ’20）

Prior review /approval oftransaction withrelated parties

0.25% of the acquisition price upon new
acquisitionDue diligence
subcommittee

Incentive Fee 3(Acquisition fee)Due diligence

3% of JPR’s income before income taxes

Investment subcommittee

Incentive Fee 2(Income-linked fee)

Decision on
acquisition policy

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

Compliance subcommittee

Incentive Fee 1(Revenue-linked fee)

Review, screening

12.5 million yen per month

Invest management department

Fixed fee

Proposal, planning

Existing AM Fee Structure

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

■ Risk Management
TRIM’s Risk Response Scheme• Develops effective risk management systemand endeavor to avoid risk
• Has strengthened risk resilience bycontinuously responding to risks based on risk
response scheme• When managing information, implements safetymeasures to address various threats anddevelops contingency plans in case of failure,etc.

Identificationof risks

Improvement

Monitoring

Assessment

Response

24

JAPAN PRIME REALTY INVESTMENT CORPORATION

3. Financial Results and Forecasts of Financial Results

25

Overview of Financial Results for the 36th Fiscal Period (Dec. ’19) (period-on-period
comparison)

3. Financial Results and Operating
Forecasts

Results of the 36th fiscal period ended December 2019
DPU: 7,493 yen (up 113 yen, period-on-period)
Rent revenue continued to increase, reflecting steady progress in attracting new tenants and revising rents upward.
Cash distributions increased for the 12th consecutive fiscal period, partly attributable to the asset replacement implemented in theprevious fiscal period.
Item
Operating revenue
Rental revenue
Gain on sale of properties
Operating expense
Expenses related to rent business
Revenue andSelling,
general and adminisutrative expenses
profit(million yen) Operating income

Non-operating income
Non-operating expenses
Ordinary income
Net income
Reserve (million yen) Transferred from reserve
DPU (yen) (per unit)

Change35th Period

36th Period(Jun. 30, '19)
16,101
15,695
405
8,147
7,349
797
7,954
72
810
7,216
7,216
405
7,380

(Dec. 31, '19)
16,00516,005
8,320
7,538
782
7,684
7
777
6,915
6,914
7,493

-95
+309
-405
+173
+188
-15
-269
-65
-32
-301
-301
-405
+113

923,000

923,000-

Item
Operating revenue
Rental revenue
Rents and common charge

Land rent
Other fixed income
Other rental revenue
Incidental income
Cancellation penalty, etc.

⑥

Income equivalent to expense forrestoration⑦

Other variable income
Expenses related to rent businessOutsourcing fees
Utilities expenses
Property and other taxes
Insurance premiums

Number of units outstanding

Repairs and maintenance
Property management fees

Rental revenue① ［Rents and common charge]② ［Land rent］③ ［Incidental income]Management association accounts

Increase (up 1.2% from the previous period) due to full-year contribution of tenants thatmoved in in the previous period and upward revision of rents
Revision of land rent of Otemachi Tower (land with leasehold interest) boosted revenue
throughout period.
Increased mainly due to seasonal factors

Depreciation
Other expenses related to rent business

NOI
NOI yield (book value)

Expenses related to rent business

Decreased mainly due to seasonal factors and the balance of utilities expenses improved④ ［Utilities expense］+26 million yen)
⑤ ［Other expenses related to rent business］

Brokerage fees, etc. increased

Non-operating income and expenses⑥ ［Nonoperating income］⑦ ［Non-operating expenses］

Likely to decrease in the absence of settlement on management association accounts (mainly
recorded in the June period every year)

Rental income-real estate
After-depreciation (book value)
Rent-paying occupancy rate (period average)

35th Period(Jun. 30, '19)

36th Period(Dec. 31, '19)

Change15,695
14,857
12,723
1,726
407
838
683
46
71
36
7,349
593
782
2,349
24
578
293
569
1,965
192
10,311
5.1%
8,346
4.1%
98.6%

16,00515,081
12,939
1,774
368
924
799
21
62
40
7,538
609
866
2,335
25
610
299
570
1,973
247
10,441
5.0%
8,467
4.1%
98.9%

+309
+223
+215
+47
-38
+86
+116
-24
-8
+3
+188
+16
+84
-13
+0
+31
+5
+1
+8
+54
+129
-0.1%pt+121- %pt+0.3%pt

Replaced
properties※1

Existing
properties※2

+73
+30
+66
-36
+42
+26
+1
+9
+5
-1
+6
+21
-7
+0
-2
+2
+8
-31
+83

+236
+193
+148
+47
-2
+43
+89
-26
-18
-1
+190
+9
+62
-6
+0
+34
+2
+1
+0
+86
+45

+75

+45

①
②

③

④

⑤

*1 Increase/decrease as a result of asset replacement in the 35th fiscal period is calculated.
*2 Increase/decrease for existing properties, excluding the above, is calculated (the major factors behind the increase/decrease for existing
properties are described in (i) to (v)).

Financial costs such as interest expense on loans and investment corporation bonds decreased26

3. Financial Results and Operating
Forecasts

Overview of Financial Results for the 36th Fiscal Period (Dec. ’19) (period-on-period
comparison)

Result of the 36th fiscal period ended December 2019
Total assets: 453.4 billion yen, NAV per unit: 259,230 yen
Item
Current Asset
Cash and deposits (including trust)
Other current asset

Noncurrent assets
Property, plant and equipment
Intangible assets
Investments and other assets

Deferred assets
Investment corporaton bond issuance costs

Investment unit issuance expenses

BalanceSheet(million yen)

Total assets
Current liabilities
Short-term loans payable
Current portion of long-term loans payable
Current portion of investment corporation bonds

Other current liabilities

Noncurrent liabilities
Long-term loans payable
Investment corporation bonds
Tenant leasehold and security deposits

Total liabilities
Unitholders' capital
SurplusReserve for reduction entry
Unappropriated retained earnings
Total net assets

35ｔh Period

36th Period(Jun. 30, '19)
36,80336,267536
415,453
403,064
11,806
583
109
101
8
452,366
30,6162,000
18,0004,000
6,616
182,583
139,520
21,50021,563
213,199
231,653
7,513
284
7,229
239,166(Dec. 31, '19)
38,196
37,775421
415,140
402,700
11,805
633
130
129
0
453,467
29,5401,000
21,0007,540
184,657
136,520
26,50021,637214,198
231,653
7,616
689
6,926
239,269

ChangeIncrease or decrease in cash and deposits
Item+1,392+1,508
-115
-312
-363
-0
+50
+21
+28
-7
+1,101-1,076-1,000+3,000-4,000+923+2,074-3,000+5,000
+74
+998
+102
+405
-302
+102

ChangeNet cash provided by operating activities+9,383

Income before income taxes+6,915

Depreciation and amortization+1,974

Other, net+494

Net cash provided by investing activities-1,025Purchase of property, plant and equipment-1,079Other, net+53

Net cash provided by financing activities-6,849Proceeds from lisbilities+16,960

Repayment of liabilities-17,000

Dividends paid

-6,810Total cash and deposits+1,508

Increase or decrease in noncurrent assets
Item

ChangeCapital expenditures+1,582

Depreciation-1,973

Others+78

Total noncurrent assets-312

Increase or decrease in liabilities
Item

New procurement

Repayment/
redemption

Balance at end ofcurrent period

ChangeShort-term loans payable

4,000

5,000

1,000

Long-term loans payable

8,000

8,000

157,520-

Investment corporation bonds

5,000

4,000

26,500+1,00017,00017,000185,020-

Total liabilities-1,00027

3. Financial Results and Operating
Forecasts

Overview of Financial Results for the 36th Fiscal Period (Dec. ’19) (compared with forecast)

Results of the 36th fiscal period ended December 2019
DPU compared with the forecast : up 63 yen
The average rent-paying occupancy rate for the period remained at high levels close to 99%.
Internal growth has progressed steadily, resulting in a higher level than initially forecast.
Item

36th Period

36th Period

ChangeItem(Dec. 31, '19)(forecast) (Dec. 31, '19)(actual)

Operating revenue
Rental revenue
Operating expense
Revenue andSelling, general and adminisutrative expenses
profitOperating income(million yen)
Non-operating income
Non-operating expenses
Ordinary income
Net income
DPU (yen) (per unit)

15,886
15,886
8,250
7,456
793
7,636
3
779
6,859
6,858
7,430

16,00516,005
8,320
7,538
782
7,684
7
777
6,915
6,914
7,493

+119
+119
+70
+81
-11
+48
+4
-2
+55
+55
+63

DPU (yen) (per unit)

923,000

923,000-

Expenses related to rent business

Rental revenue① ［Rents and common charge]

Increased, mainly attributable to new tenants moving in and rises in sales-linked rent incommercial properties. Since lost rent, etc. due to agreement cancellation was received asa penalty for cancellation, the net increase ((i)+(i)’) was approximately 62 million yen.

Operating revenue
Rental revenue
Rents and common charge
Land rent
Other fixed income
Other rental revenue
Incidental income
Cancellation penalty, etc
Income equivalent to expense for restoration
to original condition

Other variable income
Expenses related to rent businessOutsourcing fees
Utilities expenses
Property and other taxes
Insurance premiums
Repairs and maintenance
Property management fees
Management association accounts

Expenses related to rent businesslargely due to the occurrence of construction work to restore properties to② ［Repair and maintenance cost］ Increased
their original condition③ ［Property management fees］ Fees for upward revisions of rent increased due to progress with rent revisions④ ［Other expenses related to rent business］
Increased in brokerage fees, etc.

Depreciation
Other expenses related to rent business

NOI
NOI yield (book value)
Rental income-real estate
After-depreciation (book value)
Rent-paying occupancy rate (period average)

36th Period(Forecast)

36th Period(Result)

Change15,88615,034
12,895
1,774
364
852
813
2
36
7,456
617
897
2,336
25
513
287
578
1,983
217
10,413
5.0%
8,429
4.0%
98.8%

16,00515,081
12,939
1,774
368
924
799
21
62
40
7,538
609
866
2,335
25
610
299
570
1,973
247
10,441
5.0%
8,467
4.1%
98.9%

+119
+47
+43
-0
+3
+71
-13
+18
+62
+3
+81
-8
-30
-0
+0
+97
+12
-8
-9
+29
+27
- %pt
+37
+0.1%pt+0.1%pt

①

①'

②
③

④

28

3. Financial Results and Operating
Forecasts

Forecasts of Financial Results for the 37th Fiscal Period (Jun. ‘20) (compared with 36th period)

Forecast of the 37th fiscal period ending June 2020
DPU: 7,590 yen (up 97 yen from 36th period (Dec. ‘19) forecast)Contribution from both internal and external growth
The medium-term DPU target of 7,500 yen is expected to be reached, absorbing the dilutive effect of the issuance of new
investment units.
Item
Operating revenue
Rental revenue
Operating expense
Expenses related to rent business

Revenue andSelling, general and adminisutrative expenses
profitOperating income(million yen)
Non-operating income
Non-operating expenses
Ordinary income
Net income
DPU (yen) (per unit)

36th Period

37th Period(Dec. 31, '19)
16,00516,005
8,320
7,538
782
7,684
7
777
6,915
6,914
7,493

(Jun. 30, '20)(forecast)

923,000

Number of units outstanding

ChangeItem

16,43916,439
8,450
7,538
912
7,989
58
760
7,287
7,286
7,590

+433
+433
+129
-0
+130
+304
+50
-17
+372
+372
+97

Operating revenue
Rental revenue

960,000+37,000

Rents and common charge⑥⑦⑧(Rental revenue)① ［Rents and common charge]② ［Incidental income]Revenue is expected to increase mainly due to full-year contribution of tenants thatmoved in in the previous period and upward revision of rents
Expected to decrease mainly due to seasonal factors[Expenses related to rent business]

Expected to decrease mainly due to seasonal factors and balance of utilities expenses is

expected to be mostly unchanged③ ［Utility expense］
Increased due to property tax being incurred on properties acquired in the previous fiscal④ ［Property and other taxes］
period and the impact of reappraisal, among other things.
⑤ ［Other expenses related to rent business
Decreased in brokerage fees, etc.

Selling, general and adminisutrative expenses⑥ ［Selling, general and adminisutrative expenses］
The number of asset management reports increased due to the change in fee structure.

Non-operating income and expenses⑦ ［Non-operating income］⑧ ［Non-operating expenses)］

Expected to increase largely due to recording of settlement on management association accounts(mainly recorded in the June period every year)
Financial costs such as interest expense on loans and investment corporation bonds will decrease

Land rent
Other fixed income
Other rental revenue
Incidental income
Cancellation penalty, etc
Income equivalent to expense forrestoration

Other variable income
Expenses related to rent businessOutsourcing fees
Utilities expenses
Property and other taxes
Insurance premiums
Repairs and maintenance
Property management fees
Management association accounts

Depreciation
Other expenses related to rent business

NOI
NOI yield (book value)
Rental income-real estate
After-depreciation (book value)
Rent-paying occupancy rate (period average)

36th Period(Dec. 31, '19)

37th Period(Jun. 30, '20)
(forecast)

Change16,00515,081
12,939
1,774
368
924
799
21
62
40
7,538
609
866
2,335
25
610
299
570
1,973
247
10,441
5.0%
8,467
4.1%
98.9%

16,43915,64013,490
1,783
366
799
758
41
7,538
620
825
2,400
23
578
320
574
2,035
159
10,937
5.1%
8,901
4.2%
99.4%

+433
+558
+551
+9
-2
-124
-41
-21
-62
+1
-0
+10
-40
+64
-1
-31
+21
+3
+61
-88
+495
+0.1%pt+434+0.1%pt+0.5%pt

Acquiredproperties

Existing
properties

+384
+335
+332
+3
+48
+44
+4
+139
+12
+42
+0
+0
+12
+7
+6
+56
+0
+301

+49
+222
+218
+9
-5
-173
-86
-21
-62
-3
-140
-1
-83
+64
-2
-44
+13
-2
+4
-88
+194

+244

+189

*1 The increase/decrease due to the acquisition of the Minami Semba Building in the 37th fiscal period and the Sencity Building that isscheduled to be acquired is calculated.
*2 Increase/decrease for existing properties, excluding the above, is calculated (the major factors behind the increase/decrease for existing
properties are described in (i) to (v)).

①

②

③
④

⑤

29

Forecasts of Financial Results for the 38th Fiscal Period (Dec. ‘20) (compared with forecast forthe 37th period (Jun. ‘20)

3. Financial Results and Operating
Forecasts

Forecast of the 38th fiscal period ending December 2020
DPU: 7,720 yen (up 130 yen from 37th period (Jun. ‘20) forecast)

Cash distributions are expected to continue increasing, thanks to the full-year contribution of the properties acquired in theprevious fiscal period.
With an eye on a new medium-term goal, aim for stable growth through the continuous upward revision of rents and cost
control.
Item37th Period

38th Period(Jun. 30, '20/ forecast) (Dec. 31, 2020/ forecast)

Operating revenue
Rental revenue
Operating expense

ChangeItem
Operating revenue
Rental revenue

Revenue andSelling, general and adminisutrative expenses
profitOperating income(million yen)
Non-operating income
Non-operating expenses
Ordinary income
Net income
DPU (yen) (per unit)

16,43916,439
8,450
7,538
912
7,989
58
760
7,287
7,286
7,590

16,797
16,797
8,630
7,699
930
8,166
3
757
7,412
7,411
7,720

+357
+357
+180
+161
+18
+177
-54
-2
+125
+125
+130

Number of units outstanding

960,000

960,000-

Expenses related to rent business(Rental revenue)

Rents and common charge⑤

With respect to rent revisions, although the current upward rent revisions are expected to be① ［Rents and common charge] maintained, TRIM has conservative estimates of move-ins and move-outs, rent revisions, etc.
for the future.

② ［Incidental income]

Expected to increase mainly due to seasonal factors

Expected to increase mainly due to seasonal factors and balance of utilities expenses is expected
to be mostly unchanged
Brokerage fees, etc. will increase

Non-operating income and expenses⑤ ［Nonoperating income］

Income equivalent to expense forrestoration

Other variable income
Expenses related to rent businessOutsourcing fees
Utilities expenses
Property and other taxes
Insurance premiums
Repairs and maintenance
Property management fees
Management association accounts

Depreciation[Expenses related to rent business]③ ［Utility expense］④ ［Property and other taxes］

Land rent
Other fixed income
Other rental revenue
Incidental income
Cancellation penalty, etc.

Likely to decrease in the absence of settlement on management association accounts (mainly
recorded in the June period every year)

Other expenses related to rent business

NOI
NOI yield (book value)
Rental income-real estate
After-depreciation (book value)
Rent-paying occupancy rate (period average)

37th Period(Jun. 30, '20)
(forecast)

38th Period(Dec. 31, `20)
(forecast)

Change16,43915,64013,490
1,783
366
799
758
41
7,538
620
825
2,400
23
578
320
574
2,035
159
10,937
5.1%
8,901
4.2%
99.4%

16,797
15,87913,717
1,793
369
917
871
45
7,699
633
936
2,393
24
529
305
583
2,100
192
11,198
5.2%
9,097
4.2%
99.1%

+357
+239
+226
+9
+3
+117
+112
+4
+161
+12
+111
-7
+0
-49
-15
+9
+65
+33
+261
+0.1%pt+195- %pt-0.3%pt

Acquiredproperties※1

Existing
properties※2

+268
+228
+227
+0
+39
+35
+3
+78
-0
+33
-0
+0
+10
+4
+5
+23
+0
+212

+89
+11
-1
+9
+3
+78
+77
+0
+83
+13
+77
-7
+0
-59
-19
+4
+42
+32
+48

+189

+6

*1 The increase/decrease due to the acquisition of the Minami Semba Building in the 37th fiscal period and the Sencity Building that isscheduled to be acquired is calculated.
*2 Increase/decrease for existing properties, excluding the above, is calculated (the major factors behind the increase/decrease for existing
properties are described in (i) to (v)).

①

②

③

④

30

3. Financial Results and Operating
Forecasts

Change in Rental Business Profits etc.

Internal growth and external growth are progressing steadily and the upward trend in rental revenue will continue.

Item
Operating revenue
Rental revenue (fixed income)Rents and common charge
Land rent
Other fixed income
Other rental revenue (variable income)incidental income
Cancellation penalty, etc.
Income ecquivalent to expense for restoration to original condition

Other variable income
Rental business profits(million yen)

Expenses related to rent business (excluding depreciation)

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

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

Change

2.9%
2.4%
2.3%
3.0%
12.7%
19.0%

3.8%
1.3%
19.1%
-0.3%
20.3%

2.5%
0.0%
2.8%
3.1%

3.1%

(Jun. 30, '19)
15,695
14,857
12,723
1,726
407
838
683
46
71
36
5,384
593
782
2,349
24
578
293
569
192
10,311
1,965
7,349
8,346
405
8,751

Change

0.3%
0.9%
0.7%
2.8%
-9.8%
-14.7%

0.3%-0.2%-12.3%
6.3%
1.6%

0.3%
1.1%
0.5%
0.1%

4.9%

(Dec. 31, '19)
16,00515,081
12,939
1,774
368
924
799
21
62
40
5,564
609
866
2,335
25
610
299
570
247
10,441
1,973
7,538
8,467
8,467

38th Period

37th Period

36th Period

35th Period

34th Period(Dec. 31, '18)
15,652
14,723
12,630
1,679
413
929
801
16
77
33
5,367
594
891
2,210
24
569
279
568
227
10,285
1,943
7,311
8,341
8,341

Change

2.0%
1.5%
1.7%
2.7%
10.3%
17.0%

3.4%
2.7%
10.7%
-0.6%
5.4%

1.3%
0.4%
2.6%
1.5%

-3.3%

(Jun. 30, '20)
16,43915,64013,490
1,783
366
799
758
41
5,502
620
825
2,400
23
578
320
574
159
10,937
2,035
7,538
8,901
8,901

Change

2.7%
3.7%
4.3%
0.5%
-13.5%
-5.2%

-1.1%
1.8%
-4.7%
2.8%
-5.2%

4.7%
3.1%
0.0%
5.1%

5.1%

(Dec. 31, '20)
16,797
15,87913,717
1,793
369
917
871
45
5,598
633
936
2,393
24
529
305
583
192
11,198
2,100
7,699
9,097
9,097

Change

2.2%
1.5%
1.7%
0.5%
14.7%
14.9%

1.7%
2.1%
13.5%
-0.3%
-8.5%

2.4%
3.2%
2.1%
2.2%

2.2%

31

3. Financial Results and Operating
Forecasts

Changein Major Items
主要項目の変動状況

Rent revenue will increase by 550 million yen (from the 36th fiscal period (Dec. ‘19)) for the
37th fiscal period (Jun. ‘20) and by 230 million yen (from the 37th fiscal period (Jun. ‘20)) for
the 38th fiscal period (Dec. ‘20)

Plus item

Minus item

-153

+299

-176

Revisions,etc.

Other fixedincomeOtemachiTower’s rent

Sale

Acquisition-337

Revisions,
etc.

+412

Move
-outs

14,857Move-ins

Rents and common charge +215

Move
-outs

Move
-ins

15,081

Acquisition

-80

+24

Acquisition+53

Revisions,
etc.

-2

Move
-outs

+9

15,640Move-ins

OtemachiTower’s rent

Rents and common charge +551

Other fixedincomeRents and common charge +226

（million yen）

+9

Other fixedincomeRent revenue

OtemachiTower’s rent

■ Rent revenue (factor for period-on-period changes)
15,879

+3

+227

+332

+95

+47

+221

-38

+71

35th period(Jun. ‘19)

36th period (Dec. ‘19)
Rent revenue+220 million yen
Of which, rent revision (net) +70 million yen

37th period (Jun. ‘20) (Forecast)

38th period (Dec. ‘20) (Forecast)Rent revenue+550 million yen
Of which, rent revision (net) +70 million yen

Rent revenue+230 million yen
Of which, rent revision (net) +20 million yen

32

3. Financial Results and Operating
Forecasts

Fluctuations in Distribution per Unit

Forecast for the 37th fiscal period ending June 2020 up 97 yen (up 1.3% pt, compared with 36th period)
Forecast for the 38th fiscal period ending December 2020 up 130 yen (up 1.7% pt, compared with 37th period)

Main changing Items

35th period(Jun.’19)

36th Period (Dec. 2019)

Decrease in income penalty and equivalent to expense
For restoration to original condition(Expenses related to rent business)
Increase in utilities expense
Increase in repairs and maintenance expense
Increase in brokerage fee(Non-operating income )Lack of management association accounts (*1)

37th Period (Jun. 2020) (Forecast)+161 yen+51 yen+96 yen-48 yen-67 yen-37 yen-51 yen-59 yen(Rent revenue, etc.)
Increase in rents and common charge(Other rental revenue)
Decrease in incidental income

Decrease in income penalty and equivalent to expense
For restoration to original condition(Expenses related to rent business)
Decrease in utilities expense
Decrease in repairs and maintenance expense
Decrease in brokerage fee
Increase in property and other tax(Administrative expense)
Increase in asset management fee(Non-operating income)
Increase in management association accounts (*1)

Non-operating expense-19

Minus item

Non-operating income

Administrative expense

Expenses related torent business

+81

-86

+197

Plus item

-56

7,720

+2
Rental income-real estate due toproperty acquisition and sale

+11

Other rental revenue-304

Rent revenue

+54

+18

Dilution by public stock offering

+152

-141

Non-operating expense

Expenses related to rent business

Other rental revenue

-187

+265

Non-operating income

+35

+81

(Rent revenue, etc.)
Increase in rents and common charge
Increasein land rent
(Other rental revenue)
Increase in incidental income

Rent revenue

+241

7,590

Administrative expense-70

Non-operating expense

Administrative expense+16

Non-operating income

-206

7,493

Distribution per unit

Rental income-real estate due toproperty acquisition and sale

7,380

+46

Rental income-real estate due to property
acquisition and sale

+209

Other rental revenue

Rent revenue(yen/unit)

Expenses related to rent business■ Distribution per Unit (factors for period-on-period changes)

38th Period (Dec. 2020) (Forecast)+237 yen-93 yen-91yen+90yen+48yen+72 yen-70yen‐133yen(Rent revenue, etc.)+9 yenIncrease in land rent
(Other rental revenue)+80 yenIncrease in incidental income(Expenses related to rent business)-81 yenIncrease in utilities expense+62
yenIncrease in property and other tax-30 yenIncrease in brokerage fee-44 yenIncrease in depreciation expenses(Non-operating income)Lack of management association accounts (*1) -49 yen+51yen(*1) Management association accounts refer to the surplus of management association fees, etc., which are contributed by JPR in buildings managed under the form of a management association, to be refunded as settlement money at thetime of account settlement of the management association.
(*2) Fluctuations in distribution per unit are shown in the amount of the change in the variable cost for each fiscal period divided by the number of investment units outstanding as of the end of the fiscal period preceding each such period (forthe fiscal period ending June 2020, the number at the end of fiscal period ended December 2019 is shown).

33

JAPAN PRIME REALTY INVESTMENT CORPORATION

4. Appendix

34

4. Appendix

Fund Summary
31st Period(Jun. 2017)

33rd Period(Jun. 2018)34ｔｈ Period(Dec. 2018)35th Period(Jun. 2019)36ｔｈ Period(Dec. 2019)(book value)

40.7%
36.5%
4.8%
5.0%
4.5%
3.9%
4.1%

40.6%
35.5%
4.7%
4.9%
4.3%
3.8%
4.0%

40.6%
34.9%
4.7%
4.9%
4.2%
3.8%
4.0%

40.5%
34.2%
4.7%
5.0%
4.1%
3.8%
4.0%

40.9%
33.9%
4.8%
5.1%
4.2%
3.9%
4.2%

40.8%
32.9%
4.7%
5.0%
4.0%
3.8%
4.1%

(appraisal value)

3.6%

3.5%

3.4%

3.4%

3.4%

3.2%

FFO

3.8%
3.1%
8,577 million yen

3.9%
3.2%
8,587 million yen

3.7%
3.0%
8,632 million yen

3.7%
3.0%
8,707 million yen

3.3%
2.7%
8,776 million yen

3.4%
2.7%
8,888 million yen

AFFO

8,014 million yen

7,962 million yen

7,485 million yen

7,581 million yen

7,451 million yen

7,305 million yen

9,293 yen
7,440 yen
7,213 yen
3.6%
5.8%
308 yen258,516 yen
306,192 yen

9,303 yen
7,221 yen
7,223 yen
3.9%
5.6%
308 yen258,525 yen
320,060 yen

9,352 yen
7,243 yen
7,245 yen
3.5%
5.6%
308 yen258,546 yen
329,845 yen

9,433 yen
7,324 yen
7,326 yen
3.5%
5.7%
308 yen258,626 yen
341,007 yen

9,508 yen
7,818 yen
7,380 yen
3.0%
6.0%
746 yen259,118 yen
353,795 yen

9,630 yen
7,491 yen
7,493 yen
3.1%
5.8%
746 yen259,230 yen
368,917 yen

405,000 yen

367,000 yen

416,500 yen

423,000 yen

490,500 yen

488,000 yen

1.3 times
1.6 times
27.2 times
21.8 times
53.5%
77.6%
83.1%

1.1 times
1.4 times
25.4 times
19.7 times
53.4%
77.6%
83.7%

1.3 times
1.6 times
28.7 times
22.3 times
53.5%
77.5%
89.3%

1.2 times
1.6 times
28.9 times
22.4 times
53.4%
77.7%
89.2%

1.4 times
1.9 times
31.4 times
25.8 times
52.9%
77.6%
91.4%

1.3 times
1.9 times
32.6 times
25.3 times
52.8%
77.8%
94.7%

LTV

(total assets)

32nd Period(Dec. 2017)(unrealized gains and losses)(acquisition value)

NOI yield(book value)(appraisal value)

Afterdepreciation
yield
Implied cap rate(acquisition value)

NOI yield
After-depreciation yield

FFO per unit
EPS
Cash distribution per unit
Dividend yield
ROE
Reserve for reduction entry per unit
Net asset per unit
NAV per unit
Investment unit price(immediately before the ex-right date)

NAV multiple
PBR
PER
FFO multiple
Unitholder’s equity ratio
Pay out ratio（FFO）（AFFO）

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

5. Dividend yield = Cash distribution per unit (annualized, most recent result x 2) /investment unit price6. ROE (return on equity) ＝ Net income (annualized, most recent result x 2) / net assets
7. NAV per unit = (Net assets + unrealized gains or losses – total cash distributions) /number of units outstanding (end of period)
8. NAV multiple = Investment unit price / NAV per unit
9. PBR (price book-value ratio) = Investment unit price / net assets per unit

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

PER (price earnings ratio) = Investment unit price / EPS (annualized, most recent result x 2)
FFO multiple = Investment unit price / FFO per unit (annualized, most recent result x 2)
Unitholder’s equity ratio = Net assets + total assets
FFO payout ratio = Total cash distributions / FFO
AFFO payout ratio = Total cash distributions / AFFO
Reserve for reduction entry indicates the figure calculated by adding or subtracting the amounts brought
forward or reversed in the relevant fiscal period to or from the balance at the end of the fiscal period.

35

4. Appendix

Track Record of 18 Years■ Cash Distribution per Unit and Occupancy Rate
Cash distribution per unit (yen)Occupancy rate (%)
120 .0110 .099.2 99.2 99.5
97.7 98.3 99.0 98.7 98.0 97.0 96.2 96.4 96.1
96.9 97.0 97.2 97.5 97.4 97.8 98.3 98.5 98.4 98.2
95.2 94.0 93.8
94.9 96.1
93.6 94.0 95.0 94.8 94.4 95.6
92.6 93.1 94.3

100 .0Occupancy rate

96.5％ on average

90. 0

6,912 6,873

6,671
5,738

6,081

6,370 6,411 6,509

6,873 6,996 6,671

7,122 7,092

6,933 6,770

6,430
5,680 5,611

5,876

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

6,351 6,419

6,588 6,756

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

7,326 7,380 7,493

80. 0

70. 0

60. 0

50. 0

3,731

40. 0

Cash distribution per unit
2,545

30. 0

6,533 yen on average

20. 0(excluding the 1st Period)
10. 0

0

0.0

1st

2nd

3rd

(Jun. ‘02) (Dec. ’02) (Jun ’03)

4th

5th

6th

7th

8th

9th

10th

11th

12th

13th

14th

15th

16th

17th

18th

19th

20th

21st

22nd

23rd

24th

25th

26th

27th

28th

29th

30th

31st

32nd

33rd

34th

35th

36th

(Jun ’03) (Jun. ’04) (Dec. ’04) (Jun. ’05) (Dec. ’05) (Jun. ’06) (Dec. ’06) (Jun. ’07) (Dec. ’07) (Jun. ’08) (Dec. ’08) (Jun. ’09) (Dec. ’09) (Jun. ’10) (Dec. ’10) (Jun. ’11) (Dec. ’11) (Jun. ’12) (Dec. ’12) (Jun. ’13) (Dec. ’13) (Jun. ’14) (Dec. ’14) (Jun. ’15) (Dec. ’15) (Jun. ’16) (Dec. ‘16) (Jun. ’17) (Dec. ’17) (Jun. ’18) (Dec. ’18) (Jun. ’19) (Dec. ’19)

（period）■ Asset Size
Office properties in
Tokyo

1,257

921

Office properties in
Other Cities

1,396

1,636

1,796

Retail properties(based on acquisition price; 100 million yen)

3,986
3,809 3,919

1,976 2,026 2,092

2,224

2,453 2,519

2,751 2,806

2,994 3,106

3,312 3,415 3,415

4,047 4,047 4,055 4,095 4,103 4,103

4,214

4,350 4,350 4,350 4,350 4,395 4,395

Breakdown by area andby asset class(as of Dec. 31, 2019)

3,449

Office properties inTokyo
293.6 billion yen
Office properties in Other
Cities41.0 billion yen

945

Retail properties
120 .0110 .0100 .0

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

11th

12th

13th

14th

15th

16th

17th

18th

19th

20th

21st

22nd

23rd

24th

25th

26th

27th

28th

29th

30th

31st

32nd

33rd

34th

35th

36th

104.7 billion yen

90. 0
80. 0
70. 0
60. 0

(Jun. ‘02) (Dec. ’02) (Jun ’03)

(Jun ’03) (Jun. ’04) (Dec. ’04) (Jun. ’05) (Dec. ’05) (Jun. ’06) (Dec. ’06) (Jun. ’07) (Dec. ’07) (Jun. ’08) (Dec. ’08) (Jun. ’09) (Dec. ’09) (Jun. ’10) (Dec. ’10) (Jun. ’11) (Dec. ’11) (Jun. ’12) (Dec. ’12) (Jun. ’13) (Dec. ’13) (Jun. ’14) (Dec. ’14) (Jun. ’15) (Dec. ’15) (Jun. ’16) (Dec. ‘16) (Jun. ’17) (Dec. ’17) (Jun. ’18) (Dec. ’18) (Jun. ’19) (Dec. ’19)

50. 0
40. 0

（period）

30. 0
20. 0
10. 0
0.0

36

4. Appendix

Portfolio Diversification (as of December 31, 2019)

Ratio by Asset Class

Ratio by Area

Ratio by Asset Size

(Ratio of Acquisition Price)(Ratio of Acquisition Price)(Office Properties, Ratio of Acquisition Price)• Portfolio management standards :• Portfolio management standards :70 - 90% for office properties / 30 - 10% for retail properties etc.

80 - 90% for Tokyo / 20 - 10% for Other Cities

Retailproperties

23.8%

Medium-sized

Other Cities

15.3%
Officeproperties
Greater Tokyo

76.2%(3,000 m2 to less than 10,000
m2)

Central Tokyo

30.8%

Very large(30,000 m2 or more)

55.9%

28.8%

45.1%

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

24.1%

Ratio by Rent Zone

Ratio by Tenant’s Industry

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

Less than 15
thousand yen

Medical and Welfare 1.3%

2.6%

30 thousand yen
more
15 to less than 20
thousand yen

13.7%
Services

23.7%

Construction

7.6%
Wholesale and Retail

20 to less than 25
thousand yen 21.7%

Fixed-term lease contract

Public Services 3.7%

Real Estate 6.3%

29.5%

32.6%

13.7%

Other 0.8%

Transportation 3.4%

10.1%

25 to lessthan 30
thousand yen

Finance andInsurance

Information andCommunications

Ordinary lease contract

19.7%

86.3%

11.4% Manufacturing
11.9%

37

4. Appendix

Portfolio Diversification (as of December 31, 2019)■ Ratio of Tenant Occupancy■ 20 Largest Tenants (by property; based on end tenants)• The number of office tenants other than the sponsors, etc. with tenant
occupancy of 1% or more is only 4 (combined occupancy: 4.6%)(excluding property comprising land with leasehold interest) .
• Many of the retail tenants have long-term lease contracts, and thepossibility for them to cancel is rather small.

Category(No. of tenants)

Tenant28.0%

Less than 1%

65.7%

Sponsors, etc. with
1% or more

1.6%

Other tenants with
4.6%
1% or more

Housing Design Center Kobe

35,444.13

7.4

Seiyu GK

Tanashi ASTA

31,121.71

6.5

Ito-Yokado Co., Ltd.

JPR Musashikosugi Bldg.

19,740.95

4.1

JPR Umeda Loft Bldg.

18,586.97

3.9

Musashiurawa Shopping Square

9,558.51

2.0

Tower Records Japan Inc.

JPR Shibuya Tower Records Bldg.

8,076.85

1.7

The Maruetsu, Inc.

Cupo-la Main Bldg.

5,963.00

1.2

A companyMusashiurawa Shopping Square

5,285.40

1.1

The Otemachi Tower(land with Leasehold Interest

7,875.50

1.6

Yakuin Business Garden

6,029.57

1.3

Rise Arena Bldg.

6,023.39

1.3

JPR Nagoya Fushimi Bldg.

5,263.77

1.1

JPR Nagoya Fushimi Bldg.

4,904.64

1.0

Sompo Japan Nipponkoa Inc.

Sompo Japan Sendai Bldg.

4,379.30

0.9

Ｆcompany

Olinas Tower

4,255.56

0.9

Ｇ company

Shinjuku Square Tower

4242.480.9

Ｈ company

Niigata Ekinan Center Bldg.

4234.29

0.9

Ｉ company

Omiya Prime East

4078.97

0.9

Ｊ company

MS Shibaura Bldg.

4005.05

0.8

Ｋ company

Gotanda First Bldg.

3922.74

0.8

Sponsors, etc. with
1% or more
Tokyo Prime Stage Inc.
(1 company)
Ｂ company
Other tenants with Ｃ company
1% or more
Ｄ company(4 companies)
Ｅ company

Less than 1%(745 companies)

Ratio of
Leased space
occupancy(㎡)(%)

ABC Development Corporation

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

Retail tenants with
1% or more

Occupying property

38

4. Appendix

Move-Ins and Move-Outs of Tenants (as of December 31, 2019)■ Breakdown and Changes in Move-Ins and Move-Outs■ Move-In/Move-Out Spaces by Property(Move-in/move-out spaces by area and asset class: m2)
Move-Ins
Office properties inCentral Tokyo
Office properties inGreater Tokyo
Office properties in
Other Cities

Move-Outs

8,619

Net Increase/Decrease-4,289396

Gotanda First Bldg.

0

-364

364

JPR Ichigaya Bldg.

0

-290

290

Shinjuku Square Tower

0

BYGS Shinjuku Bldg.

456

-250

Shinjuku Center Building

44

-99

JPR Sendagaya Bldg.

0

Science Plaza - Yonbancho Plaza

57

-338

Tokyo Square Garden

56

-60

JPR Kojimachi Bldg.

-155

-155

FUNDES Suidobashi-2,932

-675

1,147

-573

574

481

-271

211

12,504-8,063

4,440

706
144

-817

817
395
60

0

-174

174

Rate of move-outs (right axis)（%）

JPR Chiba Bldg.

42

-385

343

5

Shinyokohama 2nd Center Bldg.

-98

-98

Kawaguchi Center Bldg.

-431

-563

Tachikawa Business Center Bldg.

-105

-633

Yume-ooka Office Tower

0

Tokyo Tatemono Yokohama Bldg.

0

-327

327

Kawasaki DICE Bidg.

211

-95

306

JPR Naha Bldg.

338

-81

419

Sompo Japan Sendai Bldg.

-118

-307

189

2.7

2.5
1.5

1.4

10,000

1.6

319,916
11,3107,605

0-10,341-10,367-10,000-30,000

707

Rate of move-ins (right axis)
4.3

6,858

6,387
-3,707
-0.8

-2.3

-707

Move-outs (left axis)

1.7-20,000

2,291
396

Move-ins (left axis)

30,00020,0002,291-5,039-18,773

-2.3
-4.1

7,616

12,504-9,979-8,063

-2.2

-1.7

1
-1

-1.1
-3
-5

Dec. '16 Jun. '17 Dec. '17 Jun. '18 Dec. '18 Jun. '19 Dec. '19 （period）

Tenjin 121 Bldg.

-55

JPR Nagoya Fushimi Bldg.

408

Yakuin Business Garden

0

（㎡）

2,445

JPR Crest Takebashi Bldg.

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

1,241

Kanematsu Bldg. Annex

Move-ins

Move-outs-1,205

4,330

2,257

Retail properties
Total(Move-ins)‐(move-out)
Kanematsu Bldg.

132
528
925

-925

-55
408
-128

128

39

4. Appendix

Occupancy Rate and Rent

(forecast)

RetailOfficeItem
Occupancy rate based on
concluded contract, %Occupancy rate based on
generated rents, %Average rent (entire area), yen
Average rent (central Tokyo),
yen
Average rent (greater Tokyo),
yen
Average rent (other cities), yen
Gap in actual rent, %Occupancy rate based on
concluded contract, %Occupancy rate based on
generated rents, %Dec. 2016(30th period)

Jun. 2017(31st period)

Dec. 2017(32nd period)

Jun. 2018(33rd period)

Dec. 2018(34th period)

Jun. 2019(35th period)

Dec. 2019(36th period)

Jun. 2020(37th period)

97.5

97.8

97.8

97.6

98.8

98.8

99.2

99.2

96.0

96.5

97.1

95.8

97.8

98.1

98.3

99.2

17,003

17,57917,626

17,85917,98018,177

18,477

18,70819,71520,70520,74820,882

21,053

21,45921,83322,075

16,77816,861

16,88817,134

17,233

17,24017,403

17,627

12,347

12,164

12,322

13,032

13,14913,375

13,562

13,788

-4.1

-4.7

-7.0

-7.5

-8.8

-10.4

-12.8

-

100.0

100.0

99.7

99.4

99.9

99.9

100.0

100.0

99.9

99.9

99.6

99.2

99.4

99.8

99.9

100.0

■ Leased Area by Rent Level/Ratio of Contracts
with Upward Rent Revision (Contracts renewed Dec. ’19 period)■ Status of Rent revision, Rent Through Tenant Replacement andContribution Rate (Dec. ‘19)
Number ofcontracts

Area
(m2)

Area ratio(%)

Increase/
Decrease(million yen)

Increase/
Decreaseratio (%)

174

70.2

85.5

+12.3

+3.1

Upward revision of rent

83

35.1

42.8

+13.4

+7.8

Downward revision of rent

5

3.3

4.1

-1.1

-4.8

Neither upward or
downward revision of rent

86

31.7

38.6

0.0

0.0

Tenant replacement subtotal

39

11.9

14.5

+11.3

+15.6

Increase through tenant
replacement
Decrease through tenant
replacements
Total (Rent revision + Tenant
replacement)

37

11.4

14.0

+12.9

+18.9

2

0.4

0.5

-1.5

-34.6

213

82.1

100.0

+23.6

+5.1

Item
Rent revision subtotal

Area(thousand m2)

Area ratio(%)

Ratio ofcontracts withupwardrevision (%)

Less than market rent

34.9

66.9

73.0

Within market rent

8.6

16.6

20.0

Market rent more

8.5

16.4

0.0

Item

■ Leased Area by Rent Level(Contracts renewed Jun. ‘20. period - Dec. ’21 period)
Area (thousand m2)

Area ratio (%)

Less than market rent

164.6

63.9

Market rent

48.7

18.9

Market rent more

44.0

17.1

Item

■ Breakdown of Reasons for Move-ins (Dec. ’19 Period)
Newestablishment/
Expansion

Relocation
within samebuilding

Downsizing/Cost
reduction

20

11

1

Consolidation

Location
Better building

Eviction, etc.

0

3

1

40

4. Appendix

Yields (as of December 31, 2019)■ Yields by Area and by Asset Class (based on book value)

Central Tokyo(NOI yield)（%）

10■ NOI Yield by Property (based on book value)

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

0

OfficeOfficeOfficeproperties inproperties in Greater Tokyo properties in
RetailOther Cities
Centralproperties
Tokyo
6.5%
6.5%
5.1%

5
4.1%

Greater Tokyo and Other Cities

Portfolio average
5.0%

Kanematsu Bldg.
Kanematsu Bldg. Annex

5

10

3.0
2.3
6.2
6.7

JPR Ningyo-cho Bldg.
Shin-Kojimachi Bldg.
JPR Crest Takebashi Bldg.
MS Shibaura Bldg.
Gotanda First Bldg.
JPR Ichigaya Bldg.

4.7
6.0
6.3
3.8
7.9

Oval Court Ohsaki Mark West
Shinjuku Square Tower
BYGS Shinjuku Tower

0

Minami Azabu Bldg.

(After-depreciation yield)

Shinagawa Canal Bldg.

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

Rokubancho Bldg.
JPR Harajuku Bldg.

10

JPR Nihonbashi‐horidome…

OfficeOfficeOfficeproperties in properties in
RetailCentralGreater Tokyo properties in
Other Cities properties
Tokyo

5

4.8%
3.5%

4.7%

Portfolio average
4.1%

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

Science Plaza-Yonbancho Plaza
Shibadaimon Center Building

4.3%

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

0

7.6

Across Shinkawa Bldg. Annex
Shinjuku Center Bldg.

（%）

4.6
4.9

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

3.2
3.1
4.9
4.3
5.4
6.2
2.9
3.9
3.5
4.6
6.6
3.2
4.7
4.8
3.0
3.6
3.1
3.1
4.4
4.1

（%）

0

15
Arca East Bldg.
JPR Chiba Bldg.
JPR Yokohama Nihon Odori Bldg.
Shinyokohama 2nd Center Bldg.
Kawaguchi Center Bldg.
JPR Ueno East Bldg.
Tachikawa Business Center Bldg.
Rise Arena Bldg.
Yume-ooka Office Tower
Olinas Tower
Tokyo Tatemono Yokohama Bldg.
Omiya Prime East
Tanashi ASTA
Cupo-la Main Bldg.
JPR Musashikosugi Bldg.
Musashiurawa Shopping Square
Kawasaki Dice Bldg.
FUNDES Ueno
Average of Greater Tokyo
Niigata Ekinan Center Bldg.
Tokyo Tatemono Honmachi Bldg.
JPR Hakata Bldg.
JPR Naha Bldg.
Sompo Japan Sendai Bldg.
Sompo Japan Wakayama Bldg.
Tenjin 121 Bldg.
JPR Dojima Bldg.
JPR Nagoya Fushimi Bldg.
Yakuin Business Garden
JPR Shinsaibashi Bldg.
JPR Umeda Loft Bldg.
Housing Design Center Kobe
JPR Chayamachi Bldg.
Average of Other Cities

5

10

15

6.4
6.7
7.2
9.6
6.4
8.2
6.0
7.3
6.5
5.8
6.2
7.9

14.1
9.0
3.9
6.2
5.3
4.5
6.6
9.8

2.8
7.3
7.0
10.9
8.5
8.0
7.7
4.8
7.6
3.5
4.0
5.6
4.1
5.7

41

4. Appendix

Diversification of Lenders and Lender Formation (as of December 31, 2019)

Diversifying fund procurement sources with a lender formation comprising
33 financial institutions and through issuance of investment corporation bonds
Yamaguchi Bank, Ltd.

1,000

Sumitomo Mitsui Trust Bank, Ltd

1,000

Mitsui Sumitomo Insurance Company, Ltd
(New)

1,000

Hiroshima Bank, Ltd.

1,000

The Hyakugo Bank, Ltd.

1,000

Tokyo Marine & Nichido Fire Insurance

1,000

The Chiba Bank, Ltd.

1,000

Daido Life Insurance Company

1,000

Daishi Bank, Ltd

1,000

The 77 Bank, Ltd.

1,000

NTT FINANCE CORPORATION

1,000

The Iyo Bank, Ltd

1,000

Resona Bank, Ltd.

2,000

The Hachijuni Bank, Ltd

2,000

Nippon Life Insurance Company (New)

2,000
2,000

Sompo Japan Nipponkoa Insurance Inc.
National Mutual Insurance
Agricultural Cooperatives

Federation

of

2,000

The Chugoku Bank, Ltd

3,000

Taiyo Life Insurance Company

3,000

Sumitomo Life Insurance Company

3,000

The Nishi-Nippon City Bank, Ltd.

4,000

The Shinkumi Federation Bank

4,000

Meiji Yasuda Life Insurance Company

4,200

The Bank of Fukuoka, Ltd. 5,000(million yen)Interest-bearing debt balance: 185,020 million yen(Breakdown of investment corporation bonds)
7th series of bonds
Investment corporation bonds
26,500Mizuho Bank, Ltd
28,00018th series of bonds
19th series of bonds
21st series of bonds
22nd series of bonds

The Bank of Tokyo-Mitsubishi
UFJ, Ltd.
24,000Sumitomo Mitsui Banking
Corporation
12,500Development Bank of Japan, Inc.
10,920Shinsei Bank, Ltd. 10,000

The Norinchukin Bank 5,000
Shinkin Central Bank 7,000
Aozora Bank, Ltd. 5,900
Mizuho Trust & Banking Co., Ltd.
7,000

23rd series of bonds
24th series of bonds(Green bond)

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

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

Credit
Limit

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

4. Appendix

Appraisal Value (as of December 31, 2019)■ An Increase in Unrealized Gains■ Factors of Change in Appraisal Value• Unrealized gains expanded to 108.1 billion yen due to an increase inappraisal value• Appraisal value increased for 50 properties with direct cap rate falling for
48 properties (out of 63 properties in total)
Appraisal value
Unrealized gains
Ratio of unrealized gains
522.6 billion yen
108.1 billion yen
26.1%(up 13.5 billion yen from 35th
period (Jun. ‘19))(up 13.9 billion yen from 35th
period (Jun. ‘19))(Changes in direct cap rate)• Decreased by 1.2 percentage points from the 17th period ended June 2010
(4.8%), the peak period for office properties in Central Tokyo

4.6
4.3

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

4.0
（%）

1,100

108.1 billion yen 50

3.7

1,000

45

3.4
0.0

900

40

800

35

700

26.1%

600
500

30
25

Dec. '09

Dec. '11

Dec. '13

Dec. '15

Dec. '17

Dec. '19 （period）

1. The changes in direct cap rate indicate the figures for the 47 properties JPR has owned since the end of June 2009 for the "Entire
portfolio," and for the 15 properties JPR owns since the date for "Office properties in Central Tokyo," respectively.

(Breakdown of unrealized gains and losses)• Amounts of both unrealized gains and unrealized losses improved from theend of the 35th period (Jun. ’19).

20（100 million yen）

400

15

300
10

200

Unrealize gains

Unrealize losses

1,200
900

5

100

0

0
-100

-5

-200

-10

-300
Dec. '02

Office properties in Central Tokyo

4.9(up 3.4% pt from 35th period(Jun. ‘19))(Changes in unrealized gains and losses)（100 million yen）

Entire portfolio

（%）

5.2

Dec. '04

Dec. '07

Dec. '10

Dec. '13

Dec. '16-15
Dec. '19 （period）

600

Total 63 properties

51 properties

300

108.1 billion yen

120.4 billion yen

ポートフォリオ合計
Entire portfolio-12.2 billion yen
Breakdown内訳of unrealized
gains and losses

0-300

12 properties

43

4. Appendix

Appraisal Value by Property (as of December 31, 2019)

Change（mn yen）

Direct cap(NCF Cap)(%)

Change（% pt）

DCF
discountrate(%)

Change(% pt)

DCF
terminal
cap(%)

Change（% pt）

Kanematsu Bldg.

15,200 +1,200

3.4

-0.1

3.2

-0.1

3.6

-0.1

14,608+591

Kanematsu Bldg. Annex

3,570

+120

3.8

-0.1

3.6

-0.1

4.0

-0.1

2,433

+1,136JPR Ningyo-cho Bldg.

2,890

+110

3.8

-0.1

3.6

-0.1

4.0

-0.1

2,101

Shin-Kojimachi Bldg.

4,190

+200

3.6

-0.1

3.3

-0.1

3.8

-0.1

2,428

JPR Crest Takebashi Bldg.

3,740

+160

3.8

0.0

3.6

0.0

4.0

0.0

3,218

+521

MS Shibaura Bldg.

14,900 +1,000

4.1

-0.1

3.8

-0.1

4.3

-0.1

10,907+3,992

Gotanda First Bldg.

3,780

+70

3.7

-0.1

3.4

-0.1

3.9

-0.1

2,894

JPR Ichigaya Bldg.

4,970

+130

3.7

-0.1

3.5

-0.1

3.9

-0.1

Oval Court Ohsaki Mark West

5,450

+690

3.8

-0.1

3.6

-0.1

4.0

Shinjuku Square Tower

14,900

-

3.7

0.0

3.5

0.0

BYGS Shinjuku Bldg.

21,600 +1,400

Property nameAppraisalvalue（mn yen）

Appraisalvalue（mn yen）

Change（mn yen）

Direct cap(NCF Cap)(%)

Change（% pt）

DCF
discountrate(%)

Change(% pt)

DCF
terminal
cap(%)

Change（% pt）

Book value(mn yen)

Unrealized
gain or loss
(mn yen)

Arca East

6,880

+30

3.8

-0.1

3.5

-0.1

4.0

-0.1

4,200

+2,679JPR Chiba Bldg.

1,810

+30

5.2

-0.1

5.0

-0.1

5.4

-0.1

2,205

-395

+788

JPR Yokohama Nihon Odori Bldg.

2,360

+10

4.9

0.0

4.7

0.0

5.1

0.0

2,408

-48

+1,761

Shinyokohama 2nd Center Bldg.

2,310

+200

4.5

-0.1

4.3

-0.1

4.7

-0.1

1,423

+886

Kawaguchi Center Bldg.

9,740

+410

4.7

-0.1

4.4

-0.1

4.9

-0.1

7,363

+2,376

JPR Ueno East Bldg.

5,380

+170

3.7

-0.1

3.5

-0.1

3.9

-0.1

2,937

+2,442+885

Tachikawa Business Center Bldg.

4,470

+210

4.1

-0.1

3.8

-0.1

4.3

-0.1

2,878

+1,591

5,192

-222

Rise Arena Bldg.

9,520

+430

3.8

-0.1

3.5

-0.1

3.9

-0.1

5,176

+4,343

-0.1

2,782

+2,667

Yume-ooka Office Tower

7,040

+130

4.0

-0.1

3.7

-0.1

4.2

-0.1

5,310

+1,7293.9

0.0

13,160+1,739Olinas Tower

40,000

+700

3.6

-0.1

3.3

-0.1

3.8

-0.1

26,732+13,267

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

Property name

3.6

-0.1

3.4

-0.1

3.8

-0.1

15,341+6,258

Tokyo Tatemono Yokohama Bldg.

9,580

+330

4.0

-0.1

3.8

-0.1

4.2

-0.1

7,121

+2,458

790

-105

4.5

-0.1

4.3

-0.1

4.7

-0.1

577

+212

Omiya Prime East

9,430

+240

4.3

-0.1

4.1

-0.1

4.5

-0.1

5,651

+3,778

Shinjuku Center Bldg.

17,300

+200

3.2

-0.1

2.9

-0.1

3.4

-0.1

22,151-4,851

Tanashi ASTA

12,500

-

5.2

0.0

5.1

0.0

5.4

0.0

7,143

+5,356

Minami Azabu Bldg.

2,910

-

3.8

-0.1

3.6

-0.1

4.0

-0.1

3,801

-891

Cupo-la Main Bldg.

2,970

+60

4.9

-0.1

4.7

-0.1

5.1

-0.1

1,642

+1,327

Shinagawa Canal Bldg.

2,360

+10

3.9

-0.1

3.6

-0.1

4.1

-0.1

1,882

+477

JPR Musashikosugi Bldg.

5,680

+10

4.7

0.0

4.5

0.0

4.9

0.0

7,197

-1,517

Rokubancho Bldg.

3,650

+100

4.8

-0.1

3.7

-0.1

4.1

-0.1

2,921

+728

Musashiurawa Shopping Square

4,350

-

4.9

0.0

4.8

0.0

5.1

0.0

3,553

+796

JPR Harajuku Bldg.

11,500

+400

3.7

0.0

3.5

0.0

3.9

0.0

8,720

+2,779Kawasaki Dice Bldg.

16,300

+100

4.1

0.0

4.0

0.0

4.3

0.0

13,057+3,242

Nihonbashi-horidome Bldg.

6,840

+10

4.2

0.0

4.0

0.0

4.4

0.0

4,788

+2,051FUNDES Ueno

4,000

+70

3.7

-0.1

3.4

-0.1

3.9

-0.1

3,812

+187

JPR Sendagaya Bldg.

12,100

-

3.8

0.0

3.6

0.0

4.0

0.0

14,781-2,681

Niigata Ekinan Center Bldg.

2,270

+10

5.6

0.0

5.6

0.0

5.8

0.0

1,566

+703

Ginza Sanwa Bldg.

3,770

-320

3.0

-0.1

2.7

-0.1

3.1

-0.1

3,687

+82

Tokyo Tatemono Honmachi Bldg.

3,620

+10

4.4

-0.1

4.1

-0.1

4.6

-0.1

4,328

-708

51,900 +1,900

2.6

-0.1

2.5

-0.1

2.7

-0.1

38,388 +13,511

JPR Hakata Bldg.

3,920

-

4.3

0.0

4.2

0.0

4.5

0.0

2,927

+992

Science Plaza - Yonbancho Plaza

3,300

+40

3.8

-0.1

3.4

-0.1

4.0

-0.1

2,739

+560

JPR Naha Bldg.

2,130

+130

5.0

-0.1

5.0

-0.1

5.2

-0.1

1,476

+653

Shibadaimon Center Bldg.

6,170

+150

3.5

-0.1

3.2

-0.1

3.7

-0.1

4,146

+2,023

Sompo Japan Sendai Bldg.

4,620

+40

4.9

-0.1

4.6

-0.1

5.1

-0.1

2,355

+2,264

Tokyo Square Garden

21,700 +1,100

2.6

-0.1

2.4

-0.1

2.8

-0.1

18,495+3,204

Sompo Japan Wakayama Bldg.

1,660

+20

6.2

-0.1

6.0

-0.1

6.5

-0.1

1,327

+332

JPR Kojimachi Bldg.

6,410

+130

3.3

-0.1

3.0

-0.1

3.4

-0.1

5,822

+587

Tenjin 121 Bldg.

3,400

+60

4.2

-0.1

3.8

-0.1

4.4

-0.1

2,031

+1,368JPR Shibuya Tower Records Bldg.

13,800

-300

3.4

-0.1

3.2

-0.1

3.6

-0.1

11,446+2,353

JPR Dojima Bldg.

3,530

+40

4.1

-0.1

3.9

-0.1

4.2

-0.1

2,146

+1,383

JPR Jingumae 432

4,230

+20

2.9

-0.1

3.0

-0.1

3.1

-0.1

4,261

-31

JPR Nagoya Fushimi Bldg.

3,400

+90

4.8

-0.1

4.4

-0.1

4.8

-0.1

3,803

-403

Shinjuku Sanchome East Bldg.

2,800

-80

3.2

-0.1

2.7

-0.1

3.4

-0.1

2,573

+226

Yakuin Business Garden

20,000 +1,000

4.0

-0.1

3.8

-0.1

4.2

-0.1

10,131+9,868Across Shinkawa Bldg. Annex

The Otemachi Tower (Land with Leasehold Interest)

Yurakucho Ekimae Bldg. (Yurakucho Itocia)

3,240

-60

2.9

-0.1

2.5

-0.1

3.1

-0.1

3,290

-50

JPR Shinsaibashi Bldg.

4,690

+140

3.7

0.0

3.4

0.0

3.8

0.0

5,131

-441

Ginza Namiki-dori Bldg.

11,100

-200

2.8

-0.1

2.5

-0.1

2.8

-0.1

10,137+962

JPR Umeda Loft Bldg.

14,400

+200

3.8

-0.1

3.5

-0.1

4.0

-0.1

12,471+1,928FUNDES Suidoubashi

3,570

-50

3.5

-0.1

3.3

-0.1

3.7

-0.1

3,208

+361

Housing Design Center Kobe

7,570

+20

5.3

0.0

5.1

0.0

5.4

0.0

6,089

+1,480JPR Chayamachi Bldg.

8,500

+680

3.3

0.0

3.0

0.0

3.4

0.0

6,004

+2,495

Total (as of 31 Dec. '19)

522,660 +13,595

414,502 +108,157

Central Tokyo

284,630 +8,025

242,893+41,736

Greater Tokyo

154,320 +3,130

109,817+44,502

Other Cities

83,710 +2,440

61,791+21,918

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

44

4. Appendix

Asset Manager■ Summary of Asset Manager■ Sponsors(as of December 31, 2019)

Name

Tokyo Realty Investment Management, Inc. (TRIM)

Address

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

Date of Foundation

April 28, 2000

Paid-in Capital(as of December 31, 2019)

Name

No. ofShareholding
seconded staff
ratiofrom sponsors

Tokyo Tatemono

52%

10

350 million yen

Yasuda Real Estate

18%－

Business Description

Asset management for investment corporation

Taisei Corporation

10%－

President and CEO

Yoshihiro Jozaki

Directors

9 (4 full-time and 5 part-time)

Sompo Japan Nipponkoa Insurance

10%

1

Number of Officers

38

Meiji Yasuda Life Insurance

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

Summary of sponsors support

1

Personnel support through dispatching personnel to TRIM
and other measures

2

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

3

Supply of properties and provision on information onproperty acquisition

4

Fund procurement support including funding through debt
finance

Board of Directors
President & CEO
Investment Committee

Compliance Committee
Compliance Office

Investment Management Division

Financial DivisionCorporate Planning /Administration Division

Research Grp.

Financial Grp.

Planning Grp.

Investment Grp.

IR Grp.

General Administration Grp.

Asset Management 1Grp.

Fund Management Grp.

Asset Management 2Grp.
Asset Management 3Grp.
Asset Engineering Grp.

45

4. Appendix

Office Property Leasing Market

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

■ Changes in the average rent of the 23 wards of Tokyo( Tokyo CBDs )Net increase in leasable
floor area

New supply

New demand

Vacancy rate

Class B Bldg.

Class C Bldg.

(yen/tsubo)

45,000(%)(thousand tsubo)

300
300

Class A Bldg.

9(Vacancy rate: right axis, Others: left axis, New supply and new demand indicate actual number)

35,00025,0005.47

2002-2019
Average of new supply

200
200
4.03

15,000

6

2020-2024
Average of new supply

5(month/5,000
year)
Dec. '07 Dec. '09 Dec. '11 Dec. '13 Dec. '15 Dec. '17 Dec. '19
1． Prepared by TRIM based on the statistics data publicized by Sanko Estate Co., Ltd. and NLI Research Institute.
2．Please refer to glossary for definition of building classes.

3.61
3.12
3

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

100
100

(pt)

140

1.88

Employed population

Male

FemaleOccupied area

130

1.55

120
110

00

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

(forecast)(forecast)(forecast)(forecast)(forecast)00（year）

1. Actual results of the vacancy rate, leasable floor area and occupied area through December 2019 are based on the Office Report (Tokyo CBDs) by Miki Shoji Co., Ltd. New
supply, new demand and loss areas as well as the leasable floor area and vacancy rate in 2020 and thereafter have been estimated based on surveys and simulations
conducted by market research agency and TRIM.
As an assumption for the simulation, the new supply area uses an estimate obtained by applying a certain multiplying factor to the average of the past results. The lost area isbased on the average of the past results as assumption.

100'05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 （year）
1. The employed population was prepared by TRIM based on the Labor Force Survey, the Ministry ofInternal Affairs and Communications.

46

4. Appendix

For-Sale Property Market

Cap Rate of Tokyo Office Properties Continues Low Level■ Expected Cap Rate of Office (major cities)
Tokyo (Otemachi, Marunouchi)
Osaka (Midosuji)
Fukuoka (Tenjin)

Nagoya (around Nagoya Sta.)
Osaka (Umeda)

Retail property (Osaka)

Economy hotel for lodging (Tokyo)

Economy hotel for lodging (Osaka)

Oct '19

Oct '18

Oct '17

Oct '16

Oct '15

Oct '14

Oct '13

Oct '12

Oct '11

Oct '10

Oct '09

Oct '08

Oct '07

Oct '06

Oct '05

Oct '19

Oct '180
2.0

Oct '17

2.50

Oct '16

3.0

Oct '15

3.5

Oct '14

4.0

Oct '13

4.5

Oct '12

5.0

Oct '11

5.5

Oct '10

6.0

Oct '09

6.5

Oct '08

7.0

Oct '07

7.5

Oct '06

8.0

Oct '05

8.5

Oct '04

Retail property (Ginza)(%)

Oct '04(%)■ Expected Cap Rate of Retail Properties and Economy Hotel for Lodging

1. Prepared by TRIM based on the Japanese real estate investor survey publicized Japan Real Estate Institute.

47

4. Appendix

Unitholders (as of December 31, 2019)■ Number of Units by Unitholder Type (923,000 units in total)

Securities
companies
45,983
5%

Individuals
29,4003%Foreign investors
233,905
25%■ Top Unitholders
Rank

Financial
institutions
530,481
57%

Other domestic
corporation
83,231
9%

Of which, investment
Trusts incorporating
JPR units272,40830%

Name

Number of
Owned
Units

Share(%)

1

Japan Trustee Services Bank, Ltd. (Trust Account)

180,163

19.5

2

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

141,119

15.3

3

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

39,800

4.3

4State Street Bank West Client Treaty 505234

30,887

3.3

5Tokyo Tatemono Co., Ltd.

29,300

3.2

6

Kawasaki Gakuen

25,0002.7

7

Meiji Yasuda Life Insurance Company

24,000

2.6

8

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

21,836

2.4

9

JP Morgan Securities Japan Co., Ltd.

16,605

1.8

10State Street Bank and Trust Company 505103

11,767

1.3

520,477

56.4■ Number of Unitholders by Unitholder Type (9,841 unitholders in total)
Securities
companies
190%Foreign investors
475
Other domestic
5%
corporation
177
2%
Financial
instituions183
2%
Individuals
8,987
91%

Total

48

4. Appendix

Investment Unit Price and Yield■Changes in JPR Dividend Yield■ Changes in JPR Unit Price

JPR

(pt)

TSE REIT Index

JPR

(%)

130

TSE REIT Index

5.0

4.5

120

4.0
110
3.5
100
3.0
90

Dec '19

Nov '19

Oct '19

Sep '19

Aug '19

Jul '19

Jun '19

May '19

Apr '19

Mar '19(month, year)

Feb '19

2.0
0

Jan '19

Dec. '19

Nov. '19

Oct. '19

Sep. '19

Aug. '19

Jul. '19

Jun. '19

May. '19

Apr. '19

Mar. '19

Feb. '1980
0Jan. '19

2.5(month, year)

1. Prepared by TRIM based on Refinitiv (Thomson Reuters) data.

49

4. Appendix

Portfolio Map■Central Tokyo

Shinjuku

Ichigaya

A-12
A-14

A-4

A-5

A-9

A-17

A-24

A-27

A-4

SaitamaPrefecture

B-5

Musashiurawa

A-20

B-6

A-3

Chiyoda Ward

A-1

A-26

A-13

A-22

B-7

Olinas Tower
Tokyo Tatemono Yokohama Building

B-13

Omiya Prime East

B-1

Tanashi ASTA

B-3

Cupo-la Main Bldg.

B-4

JPR Musashikosugi Bldg.

Yokohama

B-5

Musashiurawa Shopping Square

B-3

B-6

Kawasaki Dice Bldg.

Kamioka

B-7

FUNDES Ueno

Kawasaki

B-6

B-5

A-15

Shin-Yokohama
B-12

Tamachi
B-10

Tachikawa Business Center Bldg.

Chiba

B-4

Kanagawa
Prefecture

Hamamatsucho

JPR Ueno East Bldg.

B-8

B-12

B-14

Musashikosugi

A-25

Kawaguchi Center Bldg.

B-7

B-11

Shibuya
Shinagawa

Chuo Ward

Shibuya

Shinyokohama 2nd Center Bldg.

B-6

Rise Arena Bldg.

Tokyo

Minato WardJPR Yokohama Nihon Odori Bldg.

B-5

Yume-ooka Office Tower

Kinshicho

B-2
A-18

JPR Chiba Bldg.

B-3

B-10

Tokyo

A-3

A-1

Arca East

B-2

B-9

B-1

A-6

Shinbashi

B-1

B-11

Ikebukuro
Shinjuku

Tachikawa

A-5

Harajuku

B-9

Tanashi

B-8

A-2

Shibuya Ward

B-7

B-1

Tokyo

Chiba
Prefecture

B-3

Kawaguchi

A-23

A-21

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

B-13

Omiya

A-7

Shinjuku Ward
A-11

■Greater Tokyo

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

Acquire in 37th (plan)

B-14

Sencity Bldg.

C-12

Sompo Japan Sendai Bldg.

C-1

Niigata Ekinan Center Bldg.

C-19

J PR Nagoya Fushimi Bldg.

C-9

JPR Naha Bldg.

A-6■Other Cities
GotandaShinagawa

A-7
A-16
A-10

OhsakiShinagawa Ward

C-4

Tokyo Tatemono Honmachi Bldg.

C-17

JPR Dojima Bldg.

C-21

JPR Shinsaibashi Bldg.

C-1

JPR Umeda Loft Bldg.

C-5

JPR Chayamachi Bldg.

Acquire in 37th (plan)

C-22
A-1

Kanematsu Bldg.

A-13

Across Shinkawa Bldg. Annex

A-25

Shibadaimon Center Bldg.

A-2

Kanematsu Bldg. Annex

A-14

Shinjuku Center Building

A-26

Tokyo Square Garden

A-3

JPR Ningyo-cho Bldg.

A-15

Minami Azabu Bldg.

A-27

JPR Kojimachi Bldg.

A-4

Shin-Kojimachi Bldg.

A-16

Shinagawa Canal Bldg.

A-1

JPR Shibuya Tower Records Bldg.

A-5

JPR Crest Takebashi Bldg.

A-17

Rokubancho Building

A-3

JPR Jingumae 432

A-6

MS Shibaura Bldg.

A-18

JPR Harajuku Bldg.

A-4

Shinjuku Sanchome East Bldg.

A-7

Gotanda First Bldg.

A-20

JPR Nihonbashi-horidome Building

A-5

Yurakucho Ekimae Building (Yurakucho Itocia)

A-9

JPR Ichigaya Bldg.

A-21

JPR Sendagaya Bldg.

A-6

JPR Ginza Namiki-dori Building

A-10

Oval Court Ohsaki Mark West

A-22

Ginza Sanwa Bldg.

A-7

FUNDES Suidobashi

A-11

Shinjuku Square Tower

A-23

The Otemachi Tower

A-12

BYGS Shinjuku Bldg.

A-24

Science Plaza - Yonbancho Plaza(Land with Leasehold Interest)

SendaiMinami Semba Bldg.

C-7

JPR Hakata Bldg.

C-14

Tenjin 121 Bldg.

C-20

Yakuin Business Garden

Niigata

NagoyaKobe

Fukuoka

Osaka
Wakayama
Naha

C-4

Housing Design Center Kobe

C-13

Sompo Japan Wakayama Bldg.

50

4. Appendix

Portfolio List (Central Tokyo)

A－1 Kanematsu Bldg.

A－2 Kanematsu Bldg. Annex

A－3 JPR Ningyo-cho Bldg.

A－4 Shin-Kojimachi Bldg.

A－5 JPR Crest Takebashi Bldg.

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

③ Feb. 1993

③ Dec. 1989

③ Oct. 1984

③ Sep. 1999

④ 14,995m2④ 4,351m2④ 4,117m2④ 5,152m2④ 4,790m2

A－6 MS Shibaura Bldg.

A－7 Gotanda First Bldg.

A－9 JPR Ichigaya Bldg.

A－10 Oval Court Ohsaki Mark West

A－11 Shinjuku Square Tower① Minato-ku① Chiyoda-ku① Shinjuku-ku② B2/13F② B1/9F② B4/30F③ Feb. 1988

③ Mar. 1989

④ 31,020m2④ 5,888m2③ Oct. 1994
78,796m2 (entire④
redevelopment area)

A－13 Across Shinkawa Bldg. Annex

A－12 BYGS Shinjuku Bldg.

A－14 Shinjuku Center Building① Chuo-ku② B2/10F③ Jun. 1994
④ 5,535m2① Shinagawa-ku① Shinagawa-ku② B2/11F② B2/17F③ Jul. 1989

③ Jun. 2001

④ 10,553m2④ 28,575m2

A－15 Minami Azabu Bldg.

A－16 Shinagawa Canal Bldg.

A－17 Rokubancho Building① Minato-ku① Minato-ku① Chiyoda-ku② 9F② B1/8F② B3/7F③ Jun. 1992

③ Jul. 2008

③ Oct. 1991

④ 4,570m2④ 5,216m2④ 4,205m2① Shinjuku-ku① Shinjuku-ku② B2/14F② B5/54F③ Apr. 1985

③ Oct. 1979

④ 25,733m2④ 176,607m2

1.
2.

The property overview indicates (1) location, (2) structure/floors, (3) completion, and (4) total floor space (entire building). The same applies hereafter.
DBJ Green Building certification is as of December 2019; the same applies hereinafter.

51

4. Appendix

Portfolio List (Central Tokyo)

A－18 JPR Harajuku Bldg.

A－20 JPR Nihonbashi-horidome Building

A－21 JPR Sendagaya Bldg.

A－22 Ginza Sanwa Bldg.

① Shibuya-ku① Chuo-ku① Chuo-ku② B1/9F② B1/9F② B2/9F③ Mar. 1989

③ Jun. 2002

③ Oct. 1982

④ 6,466m2④ 7,190m2④ 8,851m2

A－24 Science Plaza - Yonbancho Plaza

A－25 Shibadaimon Center Bldg.

① Chiyoda-ku① Minato-ku② B2/12F② B1/10F③ Feb. 1995

③ Jul. 1993

④ 24,560m2④ 11,419m2

Aｰ26 Tokyo Square Garden① Shibuya-ku① Chiyoda-ku

② 8F

②－

③ May 2009

③ Apr. 2014
11,034㎡④(ground area)④ 7,683m2

A-27 JPR Kojimachi Bldg.

A－1 JPR Shibuya Tower Records Bldg.

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

A－4 Shinjuku Sanchome East Bldg.

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

③ Jan. 2007

④ 1,066m2④ 24,617m2① Chuo-ku② B4/24F③ Feb. 2013
④ 112,645㎡

A－5 Yurakucho Ekimae Building (Yurakucho Itocia)① Shibuya-ku② B1/9F② B3/8F③ Feb. 1999

③ Feb. 1992

④ 4,438㎡④ 8,449m2

Aｰ7 FUNDES Suidobashi① Chiyoda-ku③ Oct. 2007
④ 71,957m2④ 1,821㎡④ 1,477㎡② B4/20F① Chiyoda-ku

Aｰ6 JPR Ginza Namiki-dori Building① Chuo-ku② 11F③ Jun. 2008

① Chiyoda-ku② S 9F③ Jul. 201552

4. Appendix

Portfolio List (Greater Tokyo)

B－1 Arca East

B－2 JPR Chiba Bldg.

B－3 JPR Yokohama Nihon Odori Bldg.

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

③ Jan. 1991

④ 34,281m2④ 9,072m2

B－7 JPR Ueno East Bldg.

B－8 Tachikawa Business Center Bldg.

① Yokohama, Kanagawa① Yokohama, Kanagawa② B1/11F② B2/12F③ Oct. 1989
④ 9,146m① Toshima-ku② B1/8F② B1/12F② B3/42F③ Oct. 1992

③ Dec. 1994

③ Jan. 2007

④ 8,490m2④ 14,706m2

B－13 Omiya Prime East

④ 7,781m④ 91,280m2

B-14 Sencity Bldg.

① Kawaguchi, Saitama② B2/15F③ Feb. 1994
④ 28,420m2

2

B－10 Yume-ooka Office Tower

B－9 Rise Arena Bldg.

① Tachikawa, Tokyo

B－6 Kawaguchi Center Bldg.

③ Aug. 1991

2

① Taito-ku

B-12 Tokyo Tatemono Yokohama Building

B－5 Shinyokohama 2nd Center Bldg.

B－11 Olinas Tower① Yokohama, Kanagawa① Sumida-ku② B3/27F② SRB2/45F③ Mar. 1997

③ Feb. 2006

④ 185,976m2④ 257,842m2

B－3 Cupo-la Main Bldg.

B－1 Tanashi ASTA

① Yokohama, Kanagawa① Saitama, Saitama① Nishitokyo, Tokyo① Kawaguchi, Saitama② B1/9F② 9F② B2/17F② B2/10F③ May 1981

③ Feb. 2009

③ Feb. 1995

③ Jan. 2006

④ 8,772m2④ 9,203m2④ 80,675m2④ 48,321m2

B－4 JPR Musashikosugi Bldg.

B－5 Musashiurawa Shopping Square

B-7 FUNDES Ueno

B－6 Kawasaki Dice Bldg.

① Kawasaki, Kanagawa① Saitama, Saitama① Kawasaki, Kanagawa① Taito-ku② B1/6F② B1/4F② B2/11F② B1/10F③ Mar. 1983

③ Oct. 2005

③ Aug. 2003

③ Jul. 2017

④ 18,394m2④ 28,930m2④ 36,902m2④ 2,235m2① Chiba, Chiba② B2/23F③ Apr. 1993
④ 158,663㎡

53

4. Appendix

Portfolio List (Other Cities)

C－1 Niigata Ekinan Center Bldg.

C－4 Tokyo Tatemono Honmachi Bldg.

① Niigata, Niigata② B1/10F③ Mar. 1996

C－9 JPR Naha Bldg.

① Osaka, Osaka① Fukuoka, Fukuoka② B3/9F② B1/12F③ Feb. 1970

③ Jun. 1985

④ 14,619m2④ 19,950m2

C－13 Sompo Japan Wakayama Bldg.

C－7 JPR Hakata Bldg.

C－14 Tenjin 121 Bldg.

④ 9,828m

2

C－17 JPR Dojima Bldg.

④ 10,783m2① Nagoya, Aichi② 13F② B1/9F② 9F③ Jul. 2000

③ Mar. 1991

③ Jul. 1996

④ 8,690m2④ 10,201m2

C-22 Minami Semba Bldg.

④ 5,696m① Fukuoka, Fukuoka② 14F③ Jan. 20092

④ 22,286m2

C－5 JPR Chayamachi Bldg.

C－1 JPR Umeda Loft Bldg.

① Osaka, Osaka② B1/8F③ Sep. 1986
④ 7,738㎡

C－20 Yakuin Business Garden

C－4 Housing Design Center Kobe

③ Oct. 1993

④ 5,303m2③ Dec. 1997

④ 5,780m2

C－19 JPR Nagoya Fushimi Bldg.

① Osaka, Osaka② B2/9F③ Feb. 2003

② B1/12F③ Oct. 1991

① Fukuoka, Fukuoka

C－3 JPR Shinsaibashi Bldg.

② B2/10F① Sendai, Miyagi② 12F

Wakayama,①
Wakayama④ 6,715m2① Osaka, Osaka

C－12 Sompo Japan Sendai Bldg.
① Naha, Okinawa① Kobe, Hyogo① Osaka, Osaka② B2/11F② 9F③ Jun. 1994

③ Jun. 1994

④ 33,877m2④ 3,219m2① Osaka, Osaka② B1/8F③ Apr. 1990
④ 17,897m2

54

4. Appendix

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

8955

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

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

Information of initiatives on sustainability• Sustainability policy & management
・Initiatives on behalf of tenants
・Initiatives on behalf of the environment
・Local community initiatives
・Safety and security initiatives
・Initiatives aimed at employees
・Initiatives aimed at unitholders/investors

Extensive ESG related information
Regularly announce updated data55

5. Glossary
Term

Term

Meaning

Meaning

Rent gap

The rent gap for a month refers to, in lease contracts due for renewal during the four periods from theperiod ending in June 2020, the ratio obtained by subtracting the total difference between the lower limit ofrent in the market range and the existing rent that is lower than the lower limit of rent in the market range
from the total difference between the upper limit of rent in the market range and the existing rent
(excluding new contracts, etc.) that exceeds the upper limit of rent in the market range and dividing thatmonthly difference by the monthly rent for the month in question.

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

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

The number of tenants counts the parties with whom JPR has concluded lease contracts for the building
floors. When a single tenant leases multiple rooms, it 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.

Ratio of long-term,
fixed interest ratedebts

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

Average maturity

Weighted average calculated by dividing the remaining periods to the repayment dates and redemption
dates of borrowings and investment corporation bonds at the end of each fiscal period by the balance ofrespective borrowings and investment corporation bonds at the end of each fiscal period
For borrowings with scheduled repayment in installments, the weighted average of the remaining period tothe scheduled repayment dates of each installment payment in accordance with the relevant repayment
amountRevised amount of monthly rent indicates the sum total (including common charges) ofmonthly rent after revision minus monthly rent before revision upon contract renewal withrent revision in each fiscal period. For the revised amount of monthly rent for the 36th fiscal
period (Jun. ‘20), the amount of increase is an estimate based on consents regarding rents
becoming effective in the fiscal period, and the amount of decrease is an estimate assumed
for the rents becoming effective in the fiscal period.

Average debt cost

Weighted average calculated by dividing the remaining periods to the repayment dates and redemption
dates of borrowings and investment corporation bonds at the end of each fiscal period by the balance ofrespective borrowings and investment corporation bonds at the end of each fiscal period
For borrowings with scheduled repayment in installments, the weighted average of the remaining period tothe scheduled repayment dates of each installment payment in accordance with the relevant repayment
amountChange amount inmonthly rent upontenant replacement

Change amount in monthly rent upon tenant replacement indicates the sum total (includingcommon charges) of monthly rent after tenant replacement minus monthly rent before
tenant replacement in each fiscal period. The change amount of monthly rent upon tenant
replacement for the 36ｔｈ fiscal period (Jun. ‘20) is an estimate based on consents regarding
move-ins/move-outs and rents becoming effective in the fiscal period.

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

NAV per unit

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

Target rent

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

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

Base rent

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

Cap rate
Rent gap in realterms

The rent gap in real terms for a month refers to, in lease contracts due for renewal during
the four periods from the period ending in June 2020, the ratio obtained by subtracting thetotal difference between the upper limit of rent in the market range and the existingreference rent that is lower than the upper limit of rent in the market range from the total
difference between the market range rent and the existing rent (excluding new contracts,etc.) that exceeds the market range rent and dividing that monthly difference by the monthly
rent for the month in question.

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

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

Rent

The rents stated in this report include common charges.

Asset size

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

Investment ratio

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

Occupancy rate /occupancy rate
based on concluded
contracts

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

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

Average unit rent

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

Average downtime

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

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

Revised amount ofmonthly rent56