This translation of the original Japanese Notice is provided solely for information purposes. Should there be
any discrepancy between this translation and the Japanese original, the latter shall prevail.

REIT Financial Report for the 19th Fiscal Period
Name of REIT Issuer:
Stock Code No.:
Representative:
Name of Asset Manager:
Representative:
Inquiries to:July 15, 2015
Daiwa Office Investment Corporation
Stock Exchange Listing: TSE
8976
URL: http://www.daiwa-office.co.jp
Nobuaki Omura, Executive Director
Daiwa Real Estate Asset Management Co., Ltd.
Akira Yamanouchi, President and Representative Director
Yuji Shinotsuka, Vice President and Representative Director
TEL: +81-3-6215-9649
and Head of Finance Department

Scheduled date of submission of periodic securities report (yuka shoken hokokusho):Scheduled date of start of distribution payments:
Preparing presentation material:
Holding financial brief meeting:

August 25, 2015
August 11, 2015

Yes
Yes (for institutional investors and analysts)[Amounts are rounded down to the nearest million yen, except for per unit figures]

1. Status of Management and Assets for the 19th Fiscal Period
19th Fiscal Period: Fiscal period ended May 2015 (from December 1, 2014 to May 31, 2015)
18th Fiscal Period: Fiscal period ended November 2014 (from June 1, 2014 to November 30, 2014)(1) Management[% figures show the period-over-period increase (decrease)]

Operating revenue
19th
Period18th
PeriodOperating income

Ordinary income

Net income¥10,387 million

6.4%¥4,770 million

7.5%¥4,032 million

10.7%¥4,031 million

10.7%¥9,763 million

13.7%¥4,438 million

18.0%¥3,642 million

21.2%¥3,641 million

20.7%

Net income
per unit

Net income tounitholders’ equity

Ordinary income tototal assets

Ordinary income tooperating revenue

19th¥9,141
1.8%
1.0%
38.8%
Period18th¥8,414
1.7%
0.9%
37.3%
Period(Note) Net income per unit is calculated using the following daily weighted average number of investment units issued andoutstanding:
19th Period: 441,000 units; 18th Period: 432,713 units(2) Distributions
Distribution amount
per unit(excluding distribution
amount in excess of earnings)

19th
Period18th
PeriodTotal distribution amount(excluding distribution
amount in excess of earnings)

Distribution
amountin excess ofearnings
per unit

Total
distribution
amountin excess ofearnings

Distribution
amount to
net assets

Dividend
payout¥9,142¥4,031 million¥0¥– million

100.0%

1.8%¥8,256¥3,640 million¥0¥– million

100.0%

1.6%(3) Financial Position
Total assets
19th
Period18th
PeriodUnitholders’ equity tototal assets

Net assets

Net assets
per unit¥432,232 million¥222,954 million

51.6%¥505,566¥399,555 million¥222,593 million

55.7%¥504,746-1-

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period(4) Cash FlowsNet cashprovided by (used in)operating activities
19th
Period18th
PeriodNet cashprovided by (used in)investing activities

Net cashprovided by (used in)financing activities

Cash andcash equivalents
at end of period¥27,578 million(¥49,414 million)¥26,859 million¥22,790 million¥4,886 million(¥24,030 million)¥14,373 million¥17,767 million

2. Management Status Forecasts for the 20th Fiscal Period and 21st Fiscal Period
20th Fiscal Period: Fiscal period ending November 2015 (from June 1, 2015 to November 30, 2015)
21st Fiscal Period: Fiscal period ending May 2016 (from December 1, 2015 to May 31, 2016)[% figures show the period-over-period increase (decrease)]

Operating revenue
20thPeriod21stPeriodOperating income

13.2%¥5,469 million

14.7%¥4,527 million

12.3%¥4,525 million

12.3%¥11,725 million(0.3%)¥5,505 million

0.6%¥4,721 million

4.3%¥4,719 million

4.3%

Distribution amount per unit

(Reference)

Net income¥11,755 million(excluding distribution amount in excess of earnings)

20thPeriod21stPeriodOrdinary income

Distribution amount in excess of earnings per unit

¥9,350¥0¥9,750¥0

Estimated net income per unit for the 20th Fiscal Period: ¥9,350; 21st Fiscal Period: ¥9,750

3. Other(1) Changes in Accounting Policies, Changes in Accounting Estimates and Retrospective Restatement(i) Changes in accounting policies due to amended accounting standards, etc.:
None(ii) Changes in accounting policies other than (i):None(iii) Changes in accounting estimates:None(iv) Retrospective restatement:
None(2) Total Number of Investment Units Issued and Outstanding(i) Total number of investment units issued and outstanding at end of period (including treasury units):
19th Fiscal Period: 441,000 units
18th Fiscal Period:(ii) Total number of treasury units at end of period:
19th Fiscal Period:– units
18th Fiscal Period:

441,000 units– units(Note) Please refer to “Notes to Per Unit Information” on page 28 for the number of investment units used as the basis for calculating the net
income per unit.
*Explanation on the Appropriate Use of the Management Status Forecasts, and Other Matters of Special Note
The forecast figures set forth herein are the current prospects based on information currently available to the Investment Corporation and containelements of uncertainty. Accordingly, the actual operating revenue, operating income, ordinary income, net income and distribution amount per unit
may vary due to changes in the status. Moreover, the forecasts set forth herein should not be construed as a guarantee of distribution amounts. For
details on the assumptions underlying the forecast figures above, please refer to “2. Management Policy and Management Status; 2.2. Management
Status; Assumptions for the Management Status Forecasts for the 20th Fiscal Period and 21st Fiscal Period” on page 10.

2Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

1. Affiliated Juridical Persons of the Investment Corporation
Disclosure is omitted because there are no significant changes from the “Structure of the Investment Corporation” set out inthe most recent periodic securities report (yuka shoken hokokusho) (submitted on February 23, 2015).

2. Management Policy and Management Status
2.1. Management Policy
Disclosure is omitted because there are no significant changes from the “Investment Policy,” “Investment Target” and“Distribution Policy” set out in the most recent periodic securities report (yuka shoken hokokusho) (submitted on February
23, 2015) as of date of this document.
2.2. Management Status(1) Overview of the Fiscal Period under Review
A. Brief History of the Investment Corporation
Investment Corporation was established on July 11, 2005 in accordance with the Act on Investment Trusts andInvestment Corporations (Act No. 198 of 1951; including amendments thereto) with Daiwa Real Estate AssetManagement Co., Ltd. (former name K.K. daVinci Select) (the “Asset Manager”) as the organizer. After its
establishment, the Investment Corporation implemented an additional issuance of investment units through a public
offering (99,600 units) on October 18, 2005 and then listed on the Tokyo Stock Exchange, Inc. (TSE) Real Estate
Investment Trust Section (stock code: 8976) on the following day.
Though initial assets under management were 79,573 million yen (sum total of acquisition price), subsequent
activities, such as additional acquisition of properties and replacement of portfolio properties, resulted in the assets
under management amounting to 413,259 million yen as of the last day of May 2015.
The Investment Corporation strives to secure stable revenue and sustained growth of the investment assets based ona clear portfolio development policy of specializing in investment in office buildings, with a particular focus on
investment in a total floor area of more than about 2,000m2 situated in downtown Tokyo, as well as through dedicatedefforts to heighten tenant satisfaction levels.
B. Investment Environment and Management Performancea. Investment Environment (from December 2014 to May 2015)
The Japanese economy during the fiscal period under review saw a modest recovery as the rebound from the rush
demand that accompanied the consumption tax hike implemented in April 2014 receded against the backdrop of
improving employment and income environments. Moreover, an improvement of corporate performance and increaseof capital investment were seen, boosted by the advancing yen depreciation and high stock prices from the Bank ofJapan’s large-scale additional monetary easing measures as well as the decision to postpone the additional consumption
tax hike and depression of prices due to low crude oil prices. The GDP in the period of January to March 2015
announced by the Cabinet Office indicated a two-quarter consecutive growth, and the Japanese economy is expected togradually recover as improvements are seen in the employment and income environments and underpinning fromprivate consumption is expected.
In the office building leasing market in central Tokyo, with new supply having settled down, the vacancy rate took aturn after peaking in June 2013, dropping to 5.17% at the end of May 2015. Led by improvement in the vacancy rate
for large buildings, the overall vacancy rate that includes small- to medium-sized buildings also continues to be on an
improving trend. The drop in the vacancy rate is leading to a stronger sense that office rent is also bottoming out, andrent increases were seen for large buildings in some areas. The market as a whole continues to see increase in rent,
albeit slight.
For the office building transaction market, an appetite for property acquisitions continued to be strong among realestate companies, funds (including J-REITs) and oversea investors with the continuing favorable equity procurement
environment and proactive lending attitude by financial institutions backed by the forecast of an increase in property
prices in accordance with expectations for economic recovery.
b. Management Performance
In view of increasing the long-term EPS (EPS (net income per unit) after deducting gain on sales of properties) overthe medium to long term, the Investment Corporation continued to work on “external growth,” which aims to boost
revenue through acquisition of properties, and “internal growth,” which aims to maximize income generating fromexisting properties.
Concerning external growth, the Investment Corporation acquired “Daiwa Ebisu 4-chome Building” (acquisition
price: 4,135 million yen) and “LAQUAS Higashi Shinjuku” (acquisition price: 8,450 million yen) in December 2014
and “Concept Aoyama” (acquisition price: 9,800 million yen) and “Shinsen Place” (acquisition price: 4,800 million
yen) in March 2015, “Glass City Shibuya” (acquisition price: 16,000 million yen) and “Meguro Place Tower”(acquisition price: 5,600 million yen) in May 2015. Moreover, the Investment Corporation sold five properties (Daiwa
Nihombashi Honcho, Daiwa Ginza 1-chome, Daiwa Kinshicho, Daiwa Tsukiji 616 and Benex S-3). As a result, theInvestment Corporation’s assets under management as of the end of the 19th Fiscal Period (May 31, 2015) totaled 47
properties, the sum total of acquisition prices of which amounted to 413,259 million yen.
Concerning internal growth, while the office leasing market weakened, the Investment Corporation conducted
proactive leasing, such as capturing needs for floor expansion within the same property through strengthening
relationships with existing tenants and reinforcing collaboration with leasing brokers and property managers. As aresult, the occupancy rate as of the end of the 19th Fiscal Period (May 31, 2015) was 97.3%.
3

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

C. Overview of Capital Procurementa. Procurement of Capital for New Property Acquisitions
In the 19th Fiscal Period, the Investment Corporation made the following borrowings to fund the acquisition of new
properties.
・A total of 4,000 million yen was borrowed from Sumitomo Mitsui Banking Corporation, the Bank ofTokyo-Mitsubishi UFJ, Ltd., Mizuho Bank, Ltd. and Shinsei Bank, Ltd. on December 1, 2014 to fund theacquisition of a new property (Daiwa Ebisu 4-chome) acquired on the same day.
・A total of 8,500 million yen was borrowed from Sumitomo Mitsui Banking Corporation, the Bank ofTokyo-Mitsubishi UFJ, Ltd., Mizuho Bank, Ltd., Sumitomo Mitsui Trust Bank, Limited, the Development Bankof Japan Inc., Resona Bank, Ltd. and Mitsubishi UFJ Trust and Banking Corporation on December 3, 2014 to
fund the acquisition of a new property (LAQUAS Higashi Shinjuku) acquired on the same day.
・A total of 22,500 million yen was borrowed from Sumitomo Mitsui Banking Corporation, Sumitomo Mitsui Trust
Bank, Limited, Mizuho Bank, Ltd., Shinsei Bank, Ltd., Resona Bank, Ltd., the Bank of Fukuoka, Ltd., theDevelopment Bank of Japan Inc. and the 77 Bank, Ltd. on May 1, 2015 to fund the acquisition of new properties(Glass City Shibuya and Meguro Place Tower) acquired on the same day.
Furthermore, new investment units were issued through public offering with June 2, 2015 as the payment date tofund the acquisition of a new property (River Gate) acquired on the same date, but a commitment-type term loan
agreement with a 20,500 million yen maximum available borrowing amount was concluded with Sumitomo Mitsui
Banking Corporation, Mizuho Bank, Ltd., Sumitomo Mitsui Trust Bank, Limited, Resona Bank, Ltd. and Shinsei Bank,
Ltd. on April 27, 2015 as a measure against a situation in which the actual proceeds from the public offering would beless than the initial estimated amount (the agreement ended with the expiration of the borrowing period on June 17,2015).
b. Procurement of Capital for Repayment of Borrowings
In the 19th Fiscal Period, the Investment Corporation made the following borrowings to fund the repayment ofborrowings that were due for repayment.
・A total amount of 2,500 million yen was borrowed from Resona Bank, Ltd. on February 27, 2015 to fund part of therepayment of the 3,000 million yen borrowed from the same bank that was due for repayment on the same day. The
remaining 500 million yen was allocated from cash on hand.
・A total amount of 3,500 million yen was borrowed from the Development Bank of Japan Inc., Shinsei Bank, Ltd., theDevelopment Bank of Japan Inc., Shinsei Bank, Ltd., the Bank of Tokyo-Mitsubishi UFJ, Ltd., Sumitomo Mitsui
Banking Corporation and Mizuho Bank, Ltd. on March 31, 2015 to fund part of the repayment of the 7,500 million
yen borrowed from the same banks that was due for repayment on the same day. To the remaining 4,000 million yen,cash on hand was allotted.
・A total amount of 2,500 million yen was borrowed from Mizuho Bank, Ltd. and the Bank of Tokyo-Mitsubishi UFJ,
Ltd. on May 29, 2015 to fund the repayment of the 2,500 million yen borrowed from Mizuho Bank, Ltd. and the
Bank of Yokohama, Ltd. due for repayment on the same day.
c. Status of Interest-Bearing Liabilities at End of the Fiscal Period under Review
As a result of the above, the balance of interest-bearing liabilities outstanding as of the end of the 19th Fiscal Period(May 31, 2015) stood at 191,300 million yen (short-term loans payable: 9,500 million yen; long-term loans payable:
176,700 million yen; investment corporation bonds: 5,100 million yen). The balance of the current portion of long-termloans payable stood at 8,300 million yen.
Concerning borrowings in the 19th Fiscal Period, the Investment Corporation made borrowings centering on periodsof between 7 years and 8.5 years with the maximum being 9 years and extending the average remaining period from
4.39 years (18th Fiscal Period) to 4.63 years (19th Fiscal Period). Furthermore, liabilities costs were lowered by
reducing credit spreads.
List of Borrowings in the 19th Fiscal Period
Loan amount(million yen)
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,500
1,500
1,000

LenderThe Bank of Tokyo-Mitsubishi UFJ, Ltd.
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Shinsei Bank, Ltd.
Development Bank of Japan Inc.
Mitsubishi UFJ Trust and Banking Corporation
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Mizuho Bank, Ltd.
Resona Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
4

Drawdown
date
2014/12/1
2014/12/1
2014/12/1
2014/12/1
2014/12/3
2014/12/3
2014/12/3
2014/12/3
2014/12/3
2014/12/3

Repayment
date
2022/5/31
2022/11/30
2023/5/31
2023/5/31
2021/11/30
2021/11/30
2022/5/31
2022/11/30
2022/11/30
2022/11/30

Loanperiod7.5 years
8.0 years
8.5 years
8.5 years
7.0 years
7.0 years
7.5 years
8.0 years
8.0 years
8.0 years

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
Sumitomo Mitsui Banking Corporation
Resona Bank, Ltd.
Development Bank of Japan Inc.
Shinsei Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Sumitomo Mitsui Trust Bank, Limited
The 77 Bank, Ltd.
Development Bank of Japan Inc.
The Bank of Fukuoka, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Mizuho Bank, Ltd.
Shinsei Bank, Ltd.
Resona Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Mizuho Bank, Ltd.
The Bank of Tokyo-Mitsubishi UFJ, Ltd.

1,500
2,500
2,000
1,500
5,500
4,000
1,000
1,500
1,500
1,500
1,500
1,500
1,500
3,000
2,000
500

2014/12/3
2015/2/27
2015/3/31
2015/3/31
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/1
2015/5/29
2015/5/29

2023/5/31
2023/2/28
2022/3/31
2023/5/31
2015/7/31
2015/7/31
2021/5/31
2022/5/31
2023/5/31
2023/11/30
2023/11/30
2023/11/30
2023/11/30
2024/5/31
2023/11/30
2023/11/30

Balance of Borrowings from Each Financial Institution (as of May 31, 2015)
End of the 19th Fiscal Period
Lender(million yen)
Sumitomo Mitsui Banking Corporation
41,900Sumitomo Mitsui Trust Bank, Limited
25,850Development Bank of Japan Inc.
20,250Mizuho Bank, Ltd.
17,400Shinsei Bank, Ltd.
13,000
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
12,500Resona Bank, Ltd.
11,500Mitsubishi UFJ Trust and Banking Corporation
6,000
The Bank of Fukuoka, Ltd.
5,500
Kansai Urban Banking Corporation
5,000
Mizuho Trust and Banking Co., Ltd.
5,000
Aozora Bank, Ltd.
4,500
ORIX Bank Corporation
2,500
The Gunma Bank, Ltd.
2,500
The Shizuoka Bank, Ltd.
2,000
Tokio Marine & Nichido Fire Insurance Co., Ltd.
2,000
The Musashino Bank, Ltd.
2,000
The 77 Bank, Ltd.
2,000
The Higashi-Nippon Bank, Limited
1,500
The Hiroshima Bank, Ltd.
1,000
The Kagawa Bank, Ltd.
1,000
The Yamaguchi Bank, Ltd.
500
Taiyo Life Insurance Company
300
Nippon Life Insurance Company
300
Fukoku Mutual Life Insurance Company
200
Total
186,200(Note 1) Share is rounded to two decimal places.
d. Rating Information (as of May 31, 2015)
Credit rating agency
R&I
Japan Credit Rating Agency

RatingA+
AA-

Outlook
StableStable5

8.5 years
8.0 years
7.0 years
8.2 years
0.2 years
0.2 years
6.1 years
7.1 years
8.1 years
8.6 years
8.6 years
8.6 years
8.6 years
9.1 years
8.5 years
8.5 years

Share
22.50
13.88
10.88
9.34
6.98
6.71
6.18
3.22
2.95
2.69
2.69
2.42
1.34
1.34
1.07
1.07
1.07
1.07
0.81
0.54
0.54
0.27
0.16
0.16
0.11
100.00%Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
e. Shelf Registration
The Investment Corporation filed a shelf registration statement on July 17, 2014 as below. The total issuableamount as of the date of this document is 94.9 billion yen.
Investment corporation bonds (excluding short-term investment corporation bonds)
Planned issue amount
100 billion yen
Planned issue period
From July 25, 2014 to July 24, 2016
Funds for acquisition of specified assets, repayment of borrowings, redemption of
investment corporation bonds (including short-term investment corporation bonds),
Use of funds
refund of leasehold and security deposits, payment of repairs, and funds for working
capital, etc.
D. Overview of Financial Performance and Distributions
As a result of the management described above, the Investment Corporation posted financial performance for the 19th
Fiscal Period of 10,387 million yen in operating revenue, 4,770 million yen in operating income, 4,032 million yen in
ordinary income and 4,031 million yen in net income.
Concerning distributions, to ensure that the amount equivalent to distributions from earnings would be included in
the amount of tax-deductible expenses based on application of special provisions for taxation of corporation tax(Article 67-15 of the Act on Special Measures Concerning Taxation (Act No. 26 of 1957; including amendments
thereto) (the “Special Taxation Measures Act”)), the Investment Corporation decided to distribute the entire amount of
unappropriated retained earnings, excluding fractions of the distribution amount per unit that are less than 1 yen.
Accordingly, the Investment Corporation declared a distribution amount per unit of 9,142 yen.

6

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period(2) Outlook for the Next Fiscal Period
A. Investment Environment
The Japanese economy ahead is expected to see the ongoing various economic measures, centering on the public works
projects and financial policies promoted by the Abe administration, and the large-scale monetary easing policy
implemented by Bank of Japan as well as pickup in overseas economies, centering on developed countries, lead tomoderate economic recovery through improvement in corporate performance, centering on public-investment- andexports-related companies, and recovery in personal spending. However, factors such as the confusion of the Japanesefinancial market given the postponement of the consumption tax hike and the turmoil in overseas economies / overseas
financial markets with the emergence of geopolitical risks pose potential risks of disrupting the Japanese real economy
and financial environment and are thus thought to require attention
In the office building leasing market, while new supply is on a low note, factors such as improvement in
employment are stimulating demand, resulting in the vacancy rate dropping. Improvement in corporate performance isforecast to increase demand for office floor space and rent is expected to improve as a consequence. In the officebuilding transaction market, backed by the favorable financing environment and expectations of rent rising, among
other factors, property acquisition appetite among investors overseas, real estate companies and funds (including
J-REITs) is thought to grow even stronger.
B. Future Management Policy and Tasks
a. Strategy for Managing Existing Properties
Under the office leasing market conditions described above, the tenant side is also expected to become more selectivewith properties. Consequently, the Investment Corporation will carry out operational management under thefollowing policy with an aim to enhance the competitiveness of existing properties and thereby increase the long-term
EPS over the medium to long term.
(i) Maintain and raise occupancy rates
Concerning existing tenants, strive to reduce vacancy risks by improving the quality of buildings, equipment andmanagement system. In addition, concerning new tenants, strive to maintain and raise occupancy rates throughthe provision of services that are of higher satisfaction levels than competing properties through proactive
participation in the market.
(ii) Maintain and raise profitability
Aim to secure stable revenue over the medium to long term through further strengthening good relationships
with existing tenants, as well as proactively tapping the needs of new tenants by discerning the market
environment.
(iii) Lower operational management costs
Strive to lower operational management costs based on maintaining office environments of high tenantsatisfaction levels by implementing efficient operational management and reviewing systematic construction
work by optimally leveraging the economies of scale achieved from proactively realizing external growth.
b. Strategy for New Property Investments
The Investment Corporation will invest in office buildings that have a total floor area of about 2,000m2 or more basedon various external growth strategies, while maintaining a balance with the asset acquisition environment andfinancing situation. In principle, considerations will focus on Tokyo as the investment target area, but the Investment
Corporation will also consider investing in competitive properties in cities other than Tokyo from a viewpoint ofterritorially-distributed investments.
As pipeline support, in addition to expanding its own information-sourcing channels, the Investment Corporation
will continue to search for properties that meet its investment criteria by proactively gathering real estate transaction
market information through greater collaboration with the Asset Manager and Sponsor Group and utilizing theGroup’s extensive network of clients, partners, etc.
In the 19th Fiscal Period, the Investment Corporation acquired “Daiwa Ebisu 4-chome Building,” “LAQUAS
Higashi Shinjuku,” “Concept Aoyama,” “Shinsen Place,” “Glass City Shibuya” and “Meguro Place Tower” which islocated in Tokyo. The Investment Corporation believes that acquisition of these properties will contribute to further
stabilization and enhancement of the portfolio. The Investment Corporation will continue to strive to acquire
properties in line with the investment strategy described above.
c. Financial Strategy
The Investment Corporation will conduct disciplined financial management of the following basic content.
(i) Control leverage by keeping the ratio of interest-bearing liabilities (LTV) to total assets within the range of 40%
to 50% at maximum, taking into consideration also the real LTV, etc., as a principle.
(ii) Diversify repayment deadlines, targeting 30.0 billion yen as the maximum amount of interest-bearing liabilities
that shall become due during any single fiscal period as a principle.
(iii) Aim to have long-term loans account for at least 70% of total loans as a principle.
(iv) Achieve diversification of lenders, which shall mainly be Japanese financial institutions.
(v) Pursuant to its fund management rules, maintain stability in its financial standing by managing necessary funds,
such as the amount equivalent to distributions paid, separately from working capital.

7

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
C. Significant Subsequent Events① Issuance of Investment Units
The Investment Corporation resolved to issue new investment units at its Board of Directors meetings held on April
27, 2015 and May 20, 2015. Payments were completed on June 1, 2015 and June 24, 2015.
a. Issuance of New Investment Units through Public Offering(i) Number of new units offered
41,045 units (domestic: 19,545units; overseas 21,500 units）(ii) Net price (paid-in price)
563,914 yen per unit(iii) Net amount (total paid-in amount)
23,145,850,130 yen(iv) Payment dateJune 1, 2015(v) Use of proceeds
To be used as funds for and various expenses associated withthe acquisition of River Gate and part of the funds for the
repayment of borrowings for the acquisition of Glass City
Shibuya and Meguro Place Tower
b. Issuance of New Investment Units through Third-Party Allotment(i) Number of new units offered
1,955 units(ii) Net price (paid-in price)
563,914 yen per unit(iii) Net amount (total paid-in amount)
1,102,451,870 yen(iv) Allottee and number of units to be issued
Daiwa Securities Co., Ltd., 1,955 units(v) Payment dateJune 24, 2015(vi) Use of proceeds
To be used as funds for and various expenses associated withthe acquisition of River Gate and part of the funds for the
repayment of borrowings for the acquisition of Glass City
Shibuya and Meguro Place Tower② Acquisition of Assets
The Investment Corporation acquired a trust beneficial interest in real estate on June 2, 2015 as follows.
Summary of Asset Acquired
Property name
Type of asset
Location
Acquisition priceDate of conclusion of purchase agreement
Date of delivery
SellerRiver Gate
Trust beneficial interest in domestic real estate36-2 Nihonbashi Hakozakicho, Chuo-ku, Tokyo
28,000 million yen(excluding associated acquisition costs, consumption tax, etc.)
April 27, 2015
June 2, 2015
THAMES TMK

8

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
D. Outlook for Management Status
The Investment Corporation forecasts the following management status for the 20th Fiscal Period (fiscal period ending
November 2015 (from June 1, 2015 to November 30, 2015)). For the assumptions underlying the management status
forecasts, please refer to the “Assumptions for the Management Status Forecasts for the 20th Fiscal Period and 21st
Fiscal Period” on page 10.
20th Fiscal Period (fiscal period ending November 2015 (from June 1, 2015 to November 30, 2015))
Operating revenue
11,755 million yen
Operating income
5,469 million yen
Ordinary income
4,527 million yen
Net income
4,525 million yen
Distribution amount per unit
9,350 yen
Distribution amount in excess of earnings per unit
- yen
In addition, on the basis that the “Assumptions for the Management Status Forecasts for the 20th Fiscal Period and21st Fiscal Period” will remain unchanged, the Investment Corporation forecasts the following management status forthe 21st Fiscal Period (fiscal period ending May 2016 (from December 1, 2015 to May 31, 2016)).
21st Fiscal Period (fiscal period ending May 2016 (from December 1, 2015 to May 31, 2016))
Operating revenue
11,725 million yen
Operating income
5,505 million yen
Ordinary income
4,721 million yen
Net income
4,719 million yen
Distribution amount per unit
9,750 yen
Distribution amount in excess of earnings per unit
- yen
(Note) The forecast figures above are the current forecasts calculated based on certain assumptions. Accordingly,
the actual operating revenue, operating income, ordinary income, net income, distribution amount per unit anddistribution amount in excess of earnings per unit may vary due to changes in the status. Moreover, theforecasts set forth herein should not be construed as a guarantee of distribution amounts.

9

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
Assumptions for the Management Status Forecasts for the 20th Fiscal Period and 21st Fiscal Period
Item
Assumptions
 20th Fiscal Period:
Assets under management are assumed to be the 47 properties owned as of May 31, 2015, plus 1
property acquired on June 2, 2015, to total 48 properties.
Assets under 21st Fiscal Period
management
Assets under management are assumed to be the 48 properties described above.
 The actual number of properties may vary due to changes in the assets under management otherthan above.
 Rent revenue from existing properties is calculated based on historical data and taking into accountOperatingvariable factors.
revenue It is assumed that there is no gain (loss) on sales of real estate properties.
 Expenses related to rent business, which constitute a major component of operating expenses, arecalculated based on historical data and taking into account variable factors.
 Repair expenses for buildings are recorded as expenses in the amount expected to be necessary in
the respective fiscal period based on the medium to long term repair plan established by the AssetManager.
 Operating income from property leasing (excluding gain on sales of real estate properties) after
deducting expenses related to rent business (including depreciation) is expected to be 6,651 million
yen in the 20th Fiscal Period and 6,687 million yen in the 21st Fiscal Period.
 Consignment expenses are expected to be 822 million yen in the 20th Fiscal Period and 836 million
Operatingyen in the 21st Fiscal Period.
expenses Taxes and dues (fixed property tax, city planning tax, etc.) are expected to be 885 million yen in the20th Fiscal Period and 883 million yen in the 21st Fiscal Period.
 While, in general, fixed property tax, city planning tax, etc. in the transaction of real estate, etc. are
calculated on a pro rata basis and reimbursed at the time of acquisition with the current owner, but
for the Investment Corporation, the amount equivalent to the reimbursement is included in the costof acquisition and thus it is not recognized as expenses in the period of acquisition of properties. As
such, fixed property tax, city planning tax, etc. of fiscal 2016 for properties acquired in 2015 shallbe recorded as expenses starting from the fiscal period ending November 2016.
 Depreciation is expected to be 1,716 million yen in the 20th Fiscal Period and 1,740 million yen in
the 21st Fiscal Period.
 Non-operating expenses in the 20th Fiscal Period are expected to be 942 million yen, of which theinterest expenses, interest expenses on investment corporation bonds and borrowing related
expenses are expected to be 780 million yen and expenses related to the issuance of new investment
Non-operating
units are expected to be 151 million yen.
expenses Non-operating expenses in the 21st Fiscal Period are expected to be 784 million yen, of which theinterest expenses, interest expenses on investment corporation bonds, and borrowing related
expenses are expected to be 773 million yen.
 The total amount of interest-bearing liabilities is assumed to be 185,800 million yen at the end of
the 20th Fiscal Period and 185,800 million yen at the end of the 21st Fiscal Period.
 In the 20th Fiscal Period, a total of 24,248 million yen of new investment units were issued throughthe public offering on June 1, 2015 and the third-party allotment to fund part of the acquisition ofRiver Gate acquired on June 2, 2015. It is assumed that, of the 9,500 million yen of borrowings due
Interest-bearing
for repayment on July 31, 2015, 4,000 million yen will be refinanced and cash on hand will be
liabilities
allocated to the remainder. Moreover, it is assumed that all of the 4,500 million yen of borrowings
due for repayment on August 31, 2015 and the 1,600 million yen of borrowings due for repayment
on November 30, 2015 will be refinanced.
 In the 21st Fiscal Period, it is assumed that all of the 2,200 million yen of borrowings due forrepayment on May 31, 2016 will be refinanced.
 The total number of investment units is assumed to be 484,000 units in which 41,045 units of new
investment units through public offering and 1,955 units of new investment units throughTotal number ofthird-party allotment as resolved at the Board of Directors meeting held on April 27, 2015 are added
investment units
to the 441,000 units issued and outstanding as of May 31, 2015.
issued andoutstanding It is assumed that there are no changes to the number of investment units other than stated above
until the end of the 21st Fiscal Period such as through the issuance of new investment units, etc.
 The distribution amount per unit is calculated based on the cash distribution policy as set out in thearticles of incorporation of the Investment Corporation.
Distribution amount The distribution amount per unit may vary depending on a variety of factors, such as changes in the
per unit
assets under management, changes in the rent revenue due to tenant changes and other causes, andincurrence of unforeseen repairs.

10Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
Item
Distribution amountin excess of earnings
per unit
Other

Assumptions
 At present, there is no plan to make any distribution in excess of earnings (distribution amount inexcess of earnings per unit).
 It is assumed that there are no changes to laws and ordinances, the tax system, accounting
standards, listing regulations, the rules of Tokyo Stock Exchange, Inc. and The Investment Trusts
Association, Japan, etc. that will affect the abovementioned forecast figures.
 It is assumed that there will be no major unforeseen changes in general economic trends, real estatemarket conditions, etc.

2.3. Investment Risks
Disclosure is omitted because there are no significant changes from the “Part I: Fund Information; Section 1: Fund Status;
3. Investment Risks” set out in the most recent periodic securities report (yuka shoken hokokusho) (submitted on February
23, 2015).

11

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

3. Financial Statements
3.1. Balance Sheets

18th Fiscal Period[As of Nov. 30, 2014]
AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Consumption taxes receivable
Prepaid expenses
Deferred tax assets
Other
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures in trust, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
LandConstruction in progress
Buildings in trust
Accumulated depreciation
Buildings in trust, net
Structures in trust
Accumulated depreciation
Structures in trust, net
Machinery and equipment in trust
Accumulated depreciation
Machinery and equipment in trust, net
Tools, furniture and fixtures in trust
Accumulated depreciation
Tools, furniture and fixtures in trust, net
Other in trust
Accumulated depreciation
Other in trust, net
Land in trust
Construction in progress in trust
Total property, plant and equipment*1

12(Unit: thousand yen)
19th Fiscal Period[As of May 31, 2015]

12,984,949
4,782,914
303,995
243,388322,520
1,488
62,83818,702,095

16,703,952
6,086,861
275,792－
403,224
185
72,37823,542,394

3,099,008(1,542,328)
1,556,679
10,296(2,730)7,566
18,538(6,638)
11,89912,302,226
4,031
89,130,153(17,907,783)
71,222,370
908,701(159,022)
749,679
826,878(425,369)
401,509
116,862(64,114)52,7485,909(5,909)289,916,770
548,058
376,773,540

3,119,987(1,629,652)
1,490,335
10,296(2,999)7,297
18,958(7,645)
11,312
12,302,226
3,448
90,901,721(16,661,537)
74,240,183
902,042(160,128)
741,913707,599(367,021)
340,577
150,964(66,677)
84,287
4,336(4,336)－
314,767,115
408,642404,397,340*1Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

18th Fiscal Period[As of Nov. 30, 2014]
Intangible assets
Right of trademark
Leasehold rights
Leasehold rights in trust
Other
Total intangible assets
Investments and other assets
Lease and guarantee deposits in trust
Long-term prepaid expenses
Deferred tax assets
Other
Total investments and other assets
Total noncurrent assets
Deferred assets
Investment corporation bonds issuance costs
Total deferred assets
Total assets
Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Accounts payable – other
Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities
Noncurrent liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Derivatives liabilities
Total noncurrent liabilities
Total liabilities
Net Assets
Unitholders’ equity
Unitholders’ capital
Surplus
Unappropriated retained earnings (undisposed loss)
Total surplus
Total unitholders’ equity
Valuation and translation adjustments
Deferred gains or losses on hedges
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

13(Unit: thousand yen)
19th Fiscal Period[As of May 31, 2015]

1,071
2,407,101
306,884
3,857
2,718,915

883
2,407,101
306,884
3,518
2,718,387

113,684
1,094,349
104,136
10,0201,322,190
380,814,647

113,684
1,304,601
110,867
10,0201,539,174
408,654,902

38,28238,282399,555,025

35,34435,344432,232,640

941,2442,500,000
16,600,000
336,672975
1,156,701
95,501
21,631,096

889,756
9,500,000
8,300,000
632,431824
342,585
1,298,771
357,535
21,321,905

5,100,000
136,600,000
9,451,317
3,874,580
304,937
155,330,836
176,961,932

5,100,000
168,400,000
8,960,270
5,152,526
343,138
187,955,935
209,277,840

219,155,572

219,155,572

3,641,156
3,641,156
222,796,728

4,031,830
4,031,830
223,187,402(203,635)(203,635)
222,593,092
399,555,025(232,601)(232,601)
222,954,800
432,232,640

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.2. Statements of Income

18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]
Operating revenue
Rent revenue – real estate
Other lease business revenue
Gain on sales of real estate properties
Total operating revenue
Operating expenses
Expenses related to rent business
Asset management fees
Asset custody fees
Administrative service fees
Trust fees
Directors’ compensation
Other operating expenses
Total operating expenses
Operating income
Non-operating income
Interest income
Reversal of distribution payable
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Interest expenses on investment corporation bonds
Borrowing expenses
Investment unit issuance expenses
Other
Total non-operating expenses
Ordinary income
Income before income taxes
Income taxes – current
Income taxes – deferred
Total income taxes
Net income
Retained earnings brought forward
Unappropriated retained earnings (undisposed loss)*1*1

9,693,133
70,577
9,763,710

*1
*1
*2

10,112,468
34,234
240,546
10,387,249*1

4,324,674
802,292
19,65371,49022,6785,400
78,5295,324,718
4,438,992*1

4,486,646
838,943
20,432
67,73821,2785,400
176,787
5,617,225
4,770,023*3

14(Unit: thousand yen)
19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

610
638
1,688
2,937

798
867
11,652
13,318546,61035,641
166,053
46,104
5,513
799,924
3,642,006
3,642,006
987
(3)
983
3,641,022
133
3,641,156

566,001
16,892
159,621－8,365
750,879
4,032,462
4,032,462
886
5
892
4,031,570
260
4,031,830

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.3. Statements of Unitholders’ Equity
18th Fiscal Period (from June 1, 2014 to November 30, 2014](Unit: thousand yen)
Total valuation and translation
adjustments

Unitholders’ equity
Surplus

Balance at beginning of current
periodUnitholders’capitalUnappropriatedretained earnings(undisposed
loss)

Total Surplus

198,780,951

3,016,510

3,016,510

Total unitholders’ Deferred gains orequitylosses on hedges

201,797,461(142,335)

Total valuationand translation
adjustments(142,335)

Total net assets

201,655,126

Changes of items during theperiodIssuance of investment units

20,374,620

20,374,620

20,374,620

Dividends from surplus(3,016,376)(3,016,376)(3,016,376)(3,016,376)

Net income

3,641,022

3,641,022

3,641,022

3,641,022

Net changes of items otherthan shareholders’ equity
Net changes of items other thanshareholders’ equity
Balance at end of current period(61,300)(61,300)(61,300)

20,374,620

624,646624,646

20,999,266(61,300)(61,300)

20,937,965

219,155,572

3,641,156

3,641,156

222,796,728(203,635)(203,635)

222,593,092

19th Fiscal Period (from December 1, 2014 to May 31, 2015](Unit: thousand yen)
Total valuation and translation
adjustments

Unitholders’ equity
Surplus

Total net assets(203,635)

222,593,092

Unappropriatedretained earnings(undisposed
loss)

Total Surplus

219,155,572

3,641,156

3,641,156

222,796,728

Dividends from surplus(3,640,896)(3,640,896)(3,640,896)(3,640,896)

Net income

4,031,570

4,031,570

4,031,570

4,031,570

Balance at beginning of current
periodTotal unitholders’ Deferred gains orequitylosses on hedges

Total valuationand translation
adjustments

Unitholders’capital(203,635)

Changes of items during theperiodNet changes of items otherthan shareholders’ equity
Net changes of items other thanshareholders’ equity
Balance at end of current period(28,966)(28,966)(28,966)－

390,674

390,674

390,674(28,966)(28,966)

361,708

219,155,572

4,031,830

4,031,830

223,187,402(232,601)(232,601)

222,954,800

15Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.4. Statements of Cash Distributions

Item
I.
II.

Unappropriated retained earnings
Distribution amount[Distribution amount per unit]
III. Retained earnings carried forward
Method for calculating distribution amount18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]
Amount (yen)3,641,156,268
3,640,896,000[8,256]260,268
Pursuant to the policy that “theInvestment Corporation shall
distribute an amount in excess of theamount equivalent to 90% of its
distributable earnings as defined in
Article 67-15 of the Act on Special
Measures Concerning Taxation” butno more than the amount of earnings
as specified in Article 32, Item 1 ofthe Investment Corporation’s articles
of incorporation, the Investment
Corporation decided the distributions
from earnings that it shall pay out
shall be the maximum value of theintegral multiple of the total numberof units issued and outstanding(441,000 units) in an amount that is
not in excess of unappropriatedretained earnings. Accordingly, theInvestment Corporation declared a
distribution amount of 3,640,896,000
yen. Furthermore, the Investment
Corporation shall not distribute cash
in excess of earnings as stipulated in
Article 32, Item 2 of its articles ofincorporation.

16

19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]
Amount (yen)4,031,830,382
4,031,622,000[9,142]
208,382
Pursuant to the policy that “theInvestment Corporation shall
distribute an amount in excess of theamount equivalent to 90% of its
distributable earnings as defined in
Article 67-15 of the Act on Special
Measures Concerning Taxation” butno more than the amount of earnings
as specified in Article 32, Item 1 ofthe Investment Corporation’s articles
of incorporation, the Investment
Corporation decided the distributions
from earnings that it shall pay out
shall be the maximum value of theintegral multiple of the total numberof units issued and outstanding(441,000 units) in an amount that is
not in excess of unappropriatedretained earnings. Accordingly, theInvestment Corporation declared a
distribution amount of 4,031,622,000
yen. Furthermore, the Investment
Corporation shall not distribute cash
in excess of earnings as stipulated in
Article 32, Item 2 of its articles ofincorporation.

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.5. Statements of Cash Flows

18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]
Net cash provided by (used in) operating activities
Income before income taxes
Depreciation and amortization
Amortization of investment corporation bonds issuance costs
Investment unit issuance expenses
Interest income
Interest expenses(Increase) Decrease in operating accounts receivable(Increase) Decrease in consumption taxes refund receivable(Increase) Decrease in prepaid expenses
Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable – other
Increase (decrease) in accrued consumption taxes
Increase (decrease) in advances received(Increase) Decrease in long-term prepaid expenses
Decrease from sales of property, plant and equipment in trust
Other, net
SubtotalInterest income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Purchase of property, plant and equipment in trust
Purchase of intangible assets
Proceeds from tenant security deposits
Proceeds from tenant security deposits in trust
Repayments of tenant security deposits
Repayments of tenant security deposits in trust
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Proceeds from short-term loans payable
Repayment of short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Proceeds from issuance of investment corporation bonds
Redemption of investment corporation bonds redeemable
Proceeds from issuance of investment units
Dividends paid
Net cash provided by (used in) financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

17*1(Unit: thousand yen)
19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

3,642,006
1,498,701
3,009
46,104(610)
582,252(11,606)(108,337)(14,569)
71,448(10,530)(16,051)
185,224(151,906)–(235,379)
5,479,755
610(592,677)(856)
4,886,832

4,032,462
1,555,388
2,938
－
(798)
582,893
28,202
243,388(80,704)(118,588)
80,444
342,585
142,070(210,252)
21,334,754
222,262
28,157,048
798(578,393)(1,037)
27,578,415(9,503)(24,902,658)–
740,833
865,635(587,447)(136,920)(24,030,060)(22,916)(50,177,798)(780)
214,501
1,591,294(1,013,048)(5,849)(49,414,596)–(3,000,000)
17,500,000(19,000,000)
5,060,426(3,500,000)
20,328,516(3,015,578)
14,373,364(4,769,863)
22,537,727
17,767,863

9,500,000(2,500,000)
34,000,000(10,500,000)－－－(3,640,869)
26,859,130
5,022,949
17,767,863
22,790,813*1Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.6. Notes to the Going Concern
Not applicable.
3.7. Notes to Significant Accounting Policies
1.
Accumulated depreciation method(1) Property, plant and equipment (including trust assets)
for noncurrent assets
The straight-line method is adopted.
The useful life of primary property, plant and equipment are as follows:
Buildings
2~64 years
Structures
4~56 years
Machinery and equipment
4~23 years
Tools, furniture and fixtures
5~18 years(2) Intangible assets
The straight-line method is adopted.
(3) Long-term prepaid expenses
The straight-line method is adopted.
2.
Accounting policies for
Investment corporation bonds issuance costs
deferred assets
Amortized using the straight-line method over the period up to redemption.
3.
Accounting standards for recording Accounting for fixed property tax, etc.
revenues and expenses
Concerning fixed property tax, city planning tax, depreciated asset tax, etc. forowned real estate in trust, of the tax amount that has been broken down into
installments, the method of accounting for the amount corresponding to theconcerned fiscal period as expenses related to rent business is adopted.
Concerning the amount equivalent to fixed property tax, etc. for the initialfiscal year that shall be borne by the Investment Corporation in correlation withacquisitions of real estate or trust beneficial interest that have real estate as
assets in trust, the amount is not expensed but is rather included in the cost of
acquisition of the concerned real estate property.
The amount equivalent to fixed property tax, etc. that was included in the costof acquisition of real estate properties in the 18th Fiscal Period is 59,351
thousand yen and 19th Fiscal Period is 92,107 thousand yen.
4.
Hedge accounting approaches(1) Hedge accounting approach
Deferral hedge accounting is adopted.
Special accounting is adopted for interest rate swaps that meet the requirements
for special accounting.
(2) Hedging instruments and hedged items
Hedging instruments:
Interest rate cap transactions
Hedged items:
Interest on loans(3) Hedging policy
The Investment Corporation conducts derivative transactions to hedge risks
stipulated in the Investment Corporation’s articles of incorporation inaccordance with the Investment Corporation’s risk management policy.
Method for assessing the effectiveness of hedging(4) The effectiveness of hedging is assessed by the correlation between the change
in aggregated amount of cash flow of the hedging instruments and the change
in aggregated amount of cash flow of the hedged items.
Interest rate swaps that meet the requirements for special accounting are
omitted from assessment of the effectiveness.
5.
Scope of funds in the
The funds (cash and cash equivalents) in the statements of cash flows consist of cash
statements of cash flows
on hand and cash in trust; deposits that can be withdrawn at any time and deposits intrust; and short-term investments with a maturity of 3 months or less from the date ofacquisition, which are readily convertible to cash and bear only an insignificant riskof price fluctuation.

18

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
6.

Other significant matters forming
basis for preparation of financial
statements

(1)

(2)

Accounting method for trust beneficial interest in real estate, etc.
Concerning owned trust beneficial interest that have real estate properties asassets in trust, all accounts of assets and liabilities within assets in trust as well
as all accounts of revenues and expenses incurred from the assets in trust arerecorded in the relevant account item of the balance sheets and statements ofincome.
The following material items of the assets in trust recorded in the relevant
account item are separately listed on the balance sheets.
(i) Cash and deposits in trust(ii) Buildings in trust, structures in trust, machinery and equipment in trust,
tools, furniture and fixtures in trust, other tangible assets in trust, land intrust and construction in progress in trust(iii) Leasehold rights in trust(iv) Lease and guarantee deposits in trust(v) Tenant leasehold and security deposits in trust
Accounting method for consumption taxes
Consumption tax and local consumption tax are accounted for by the
tax-exclusion method and consumption taxes that are not tax-deductible are
expensed in the fiscal period under review.
The consumption taxes relating to noncurrent assets, etc. that are nottax-deductible are amortized in equal installments over 5 years.

3.8. Notes to Financial Statements
Concerning notes to lease transactions, securities, retirement benefits, tax-effect accounting and asset retirement
obligations, disclosure is omitted because there is no substantial need for such disclosure in the financial report (kessan
tanshin).
[Notes to Balance Sheets]*1. Advanced depreciation amount for noncurrent assets acquired by government subsidies, etc.
18th Fiscal Period[As of November 30, 2014]
Buildings in trust

19th Fiscal Period[As of May 31, 2015]

32,898 thousand yen

Buildings in trust

32,898 thousand yen

2. Commitment-type term loan agreement
The Investment Corporation concluded a commitment-type term loan agreements with five transacting banks during the
fiscal period under review. As of the end of the fiscal period under review, there is no balance of borrowings based on thisagreement.
18th Fiscal Period[As of November 30, 2014]

19th Fiscal Period[As of May 31, 2015]

Total amount of commitment-type term loans
Balance of borrowings－thousand yen－thousand yen

20,500,000 thousand yen－thousand yen

Difference－thousand yen

20,500,000 thousand yen*3. Minimum net assets as provided in Article 67, Paragraph 4 of the Act on Investment Trusts and Investment Corporations
18th Fiscal Period[As of November 30, 2014]

19th Fiscal Period[As of May 31, 2015]

50,000 thousand yen

50,000 thousand yen

19Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Statements of Income]*1. Breakdown of operating income (loss) from property leasing(Unit: thousand yen)
19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]
A.

B.

C.

Property leasing revenue
Rent revenue – real estate
Other lease business revenue

9,693,133
70,577

10,112,468
34,234
9,763,710

Total property leasing revenue
Property leasing expenses
Consignment expenses
Utilities expenses
Taxes and dues
Non-life insurance expenses
Repair expenses
Depreciation
Other lease business expenses

769,360
1,072,401
792,627
14,425125,020
1,497,217
53,621

Total property leasing expenses
Operating income (loss) from property
leasing [A – B]

10,146,702
791,273
1,024,278
811,787
14,355
227,519
1,553,853
63,5784,324,674

4,486,646

5,439,036

5,660,056*2. Breakdown of gain on sales of real estate properties (Unit: thousand yen)
18th Fiscal Period [From: June 1, 2014 To: November 30, 2014]
Not applicable.
19th Fiscal Period [From: December 1, 2014 To: May 31, 2015]
Proceeds from sales of real estate properties
Cost of sales of real estate properties

21,846,254
21,325,541
280,166

Other expenses on sales

240,546

Gain on sales of real estate properties

Individual sales prices are not disclosed as the consent of buyers was not obtained. The 685,892 thousand yen of gain on sales of realestate properties and 445,345 thousand yen of loss on sale of real estate properties are offset in the above gain on sales of real estate
properties.

*3. Transactions with major unitholders(Unit: thousand yen)
18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]
Transactions other than business transaction
Interest expenses on investment corporation bonds

19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

28,277-[Notes to Statements of Unitholders’ Equity]
18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]

19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]*1. Total number of investment units authorized and numberof investment units issued and outstanding
Total number of investment units authorized
Number of investment units issued and outstanding

20

2,000,000 units

2,000,000 units

441,000 units

441,000 units

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Statements of Cash Flows]*1. Reconciliation of balance sheet items to cash and cash equivalents at end of period in the statements of cash flows(Unit: thousand yen)
18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]

19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

Cash and deposits
Cash and deposits in trust

12,984,949
4,782,914

16,703,952
6,086,861

Cash and cash equivalents

17,767,863

22,790,813[Notes to Financial Instruments](1) Matters Concerning Status of Financial Instruments(a) Policy for financial instruments
The Investment Corporation raises funds through bank borrowings, issuance of investment corporation bonds andissuance of new investment units, etc. for the acquisition and repair of investment properties, the payments ofdividends and the reimbursement of bank borrowings.
As for debt finance, the Investment Corporation focuses on lengthening maturities, fixing interest rates, anddispersing maturity dates in order to secure financial stability and avoid future fluctuation risk of interest rates.
The Investment Corporation manages surplus funds through safe and highly liquid money claims and securities (inprinciple, deposits).
Derivative transactions are limited to hedge operations which hedge against interest rate risks.
(b) Contents and risk of financial instruments and policies and related risk management
The Investment Corporation uses the proceeds from the financing of debts and investment corporation bonds for theacquisition of investment properties (such as trust beneficial interest in real estate) and the reimbursement of current
debts and bonds. While these debts and bonds are exposed to liquidity risk, the Investment Corporation manages therisk by maintaining the LTV ratio at low levels, dispersing maturity dates, maintaining the ratio of long-term debt tototal debt at high levels, and diversifying lenders with particular focus on domestic financial institutions.
Bank borrowings with floating interest rates are exposed to interest rate risk and the risk is controlled by using
derivative instruments (interest swap transaction). Moreover, a commitment-type term loan is used in order to reduce
fund procurement risk when acquiring properties using forward commitments, etc.
The effectiveness of hedging is assessed by the correlation between the change in aggregated amount of cash flow of
the hedging instruments and the change in aggregated amount of cash flow of the hedged items. Interest rate swaps thatmeet the requirements for special accounting are omitted from assessment of the effectiveness.
Enforcement and management of derivative transactions are carried out in accordance with the provisions
established by the basic policy of risk management.
Security deposits from tenants are exposed to liquidity risk upon tenants moving out and the Investment Corporation
reduces the risk by pooling funds to a certain degree.
Surplus funds by deposits are exposed to credit risk of counterparties (financial institutions and so on) and aremanaged by limiting the terms to short durations and establishing credit rating level of counterparties, etc.
(c) Supplementary explanation for fair value of financial instruments
The fair value of financial instruments is based on their market price. The fair value of financial instruments with noavailable market price is determined by using price reasonably estimated. As various factors are incorporated into thesecalculations, the resulting value may differ if different assumptions are provided. Furthermore, the contractual amountsof derivative transactions do not represent the market risk involved in these derivative transactions.
(2) Matters Concerning Fair Value, etc. of Financial Instruments
The carrying amounts and fair values and their differences are as follows. Please note that the following table does notinclude those for which discerning of fair value is recognized to be extremely difficult (please refer to (Note 2)).

21

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
18th Fiscal Period [As of November 30, 2014]
Carrying amount(Unit: thousand yen)
Difference

Fair value(1) Cash and deposits

12,984,949

12,984,949–(2) Cash and deposits in trust

4,782,914

4,782,914–

17,767,863

17,767,863–

2,500,000

2,500,000

16,600,000
5,100,000
136,600,000
160,800,000(309,242)

16,603,735
5,121,660
136,741,916
160,967,311(309,242)–
3,735
21,660141,916
167,311–

Total assets(3) Short-term loans payable(4) Current portion of long-term loans payable(5) Investment corporation bonds(6) Long-term loans payable
Total liabilities
Derivative transactions (*)
19th Fiscal Period [As of May 31, 2015]

Carrying amount(Unit: thousand yen)
Difference

Fair value(1) Cash and deposits

16,703,952

16,703,952－(2) Cash and deposits in trust

6,086,861

6,086,861－

22,790,813

22,790,813－(3) Short-term loans payable

9,500,000

9,500,000－(4) Current portion of long-term loans payable

8,300,000

8,303,752

3,752(5) Investment corporation bonds

5,100,000

5,081,325(18,674)

168,400,000

168,552,647

152,647

191,300,000

191,437,725

137,725

Total assets(6) Long-term loans payable
Total liabilities

Derivative transactions (*)－(343,641)(343,641)(*) The value of assets and liabilities arising from derivatives are indicated at net basis. The amount in parentheses represents
the net liability position.
(Note 1) Method of calculation of fair value of financial instruments and matters concerning derivatives.
Assets(1) Cash and deposits; (2) Cash and deposits in trust
As these are settled within a short period of time, the fair value is approximately the same as the book value and thus isstated at that book value.
Liabilities(3) Short-term loans payable; (4) Current portion of long-term loans payable; (6) Long-term loans payable
As those with floating interest rates reflect market interest rates within a short period of time and the Investment
Corporation’s credit capability does not differ markedly from the execution, the fair value is approximately the same as
the book value and thus is stated at that book value. Those with fixed interest rates, on the other hand, are based on themethod of calculating by discounting the sum total amount of principal and interest (*) by the reasonably estimatedinterest rate in the case that the same type of borrowings are undertaken.
(*) For long-term loans payable that are subject to special accounting for interest rate swaps, the interest is handled
together with applicable interest rate swaps. (Please refer to [Notes to Derivative Transactions] below.)(5) Investment corporation bonds
The fair value of the investment corporation bonds issued by the Investment Corporation is based on the market price.
Derivative transactions
Please refer to [Notes to Derivative transactions] below.
(Note 2) Financial products for which it is extremely difficult to estimate fair value.
(Unit: thousand yen)
18th Fiscal Period[As of November 30, 2014]

19th Fiscal Period[As of May 31, 2015]

9,451,317
Tenant leasehold and security deposits
8,960,270
Tenant leasehold and security deposits in trust
3,874,580
5,152,526
Total
13,325,898
14,112,797
Tenant leasehold and security deposits and tenant leasehold and security deposits in trust that are deposited by lesseesof rental properties are not subject to disclosure of market price because discerning of the market price is recognized to22

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
be extremely difficult as future cash flows cannot be reasonably estimated due to there being no fair value anddifficulty in calculation of the actual deposit period.
(Note 3) Amount of redemption of monetary claims scheduled to be due after the settlement of accounts.
18th Fiscal Period [As of November 30, 2014](Unit: thousand yen)
Within 1 year

Within 2 years,
but over 1 year

Within 3 years,
but over 2 years

Within 4 years,
but over 3 years

Within 5 years,
but over 4 years

Cash and deposits

12,984,949

–

–

–

–

–

Cash and deposits in trust

4,782,914

–

–

–

–

–

17,767,863

–

–

–

–

–

Within 2 years,

Within 3 years,

Within 4 years,

Within 5 years,

but over 1 year

but over 2 years

but over 3 years

but over 4 years

Total

Over 5 years

19th Fiscal Period [As of May 31, 2015](Unit: thousand yen)
Within 1 year

Over 5 years

Cash and deposits

16,703,952

–

–

–

–

–

Cash and deposits in trust

6,086,861

–

–

–

–

–

Total

22,790,813

–

–

–

–

–

(Note 4) Amount of repayment of short-term loans payable, current portion of long-term loans payable, long-term loans
payable and investment corporation bonds scheduled to be due after the settlement of accounts.
18th Fiscal Period [As of November 30, 2014](Unit: thousand yen)
Within 2 years,

Within 3 years,

Within 4 years,

Within 5 years,

2,500,000

but over 1 year–

but over 2 years–

but over 3 years–

but over 4 years–

16,600,000

–

–

–

–

–

–
–
19,100,000–
3,700,000
3,700,000–
28,250,000
28,250,000–
17,350,000
17,350,000

3,000,000
21,000,000
24,000,000

2,100,000
66,300,000
68,400,000

Within 1 year

Within 2 years,
but over 1 year

Within 3 years,
but over 2 years

Within 4 years,
but over 3 years

Within 5 years,
but over 4 years

Short-term loans payable

9,500,000

－

－

－

－

－

Current portion of
long-term loans payable

8,300,000

－

－

－

－

－

Investment corporation bonds

－

－

－

－

3,000,000

2,100,000

Long-term loans payable－

18,200,000

19,400,000

21,500,000

24,000,000

85,300,000

17,800,000

18,200,000

19,400,000

21,500,000

27,000,000

87,400,000

Within 1 year
Short-term loans payable
Current portion of
long-term loans payable
Investment corporation bonds
Long-term loans payable
Total

Over 5 years–

19th Fiscal Period [As of May 31, 2015](Unit: thousand yen)

Total

23

Over 5 years

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Derivative Transactions](1) Transactions for which hedge accounting is not applied
18th Fiscal Period [As of November 30, 2014]
Not applicable.
19th Fiscal Period [As of May 31, 2015]
Not applicable.
(2) Transactions for which hedge accounting is applied
18th Fiscal Period [As of November 30, 2014]
About derivative transactions for which hedge accounting is applied, the contract amount, amount equivalent to theprincipal provided in the contract, etc. as of the settlement of accounts for each hedge accounting approach are as follows.
(Unit: thousand yen)Contract amount, etc.
Hedge
Main
Method ofType, etc. of derivative
accounting
hedgedFair value
calculation of
Of which,transaction
approach
item
that fair value
over 1 year
Interest rate swap
Principle
Long-term
Based on pricetransaction
accounting
loans
71,400,000
64,400,000(309,242)
quoted by partner
Fixed payable
methodpayablefinancial institution
Floating receivable
SpecialInterest rate swap
Long-term
accounting
transaction
loans
35,350,000
29,350,000(*)－
for interest
Fixed payablepayablerate swaps
Floating receivable
Total
106,750,000
93,750,000(309,242)－
19th Fiscal Period [As of May 31, 2015]
About derivative transactions for which hedge accounting is applied, the contract amount, amount equivalent to theprincipal provided in the contract, etc. as of the settlement of accounts for each hedge accounting approach are as follows.
(Unit: thousand yen)Contract amount, etc.
Main
Method of
Hedge
Type, etc. of derivative
hedgedFair value
calculation of
accounting
Of which,transaction
approach
item
that fair value
over 1 year
Interest rate swap
Principle
Long-term
Based on pricetransaction
accounting
loans
quoted by partner
66,400,000
64,400,000(343,641)
Fixed payable
methodpayablefinancial institution
Floating receivable
SpecialInterest rate swap
Long-term
accounting
transaction
loans－
32,850,000
27,350,000(*)
for interest
Fixed payablepayablerate swaps
Floating receivable
Total－
99,250,000
91,750,000(343,641)(*) Since the derivative financial instruments qualifying for the special accounting for interest rate swaps are accounted for as
one transaction together with their hedged item, long-term loans payable, the fair value of these derivatives is included inthat of related long-term loans payable. (Please refer to “Notes to Financial Instruments (2) Matters Concerning Fair Value,etc. of Financial Instruments (Note 1) Liabilities (4) (6)”).

24

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Transactions with Related Parties](1) Transactions with related parties
18th Fiscal Period [From: June 1, 2014 To: November 30, 2014]
Classification

Parentcompany

Name ofcompany,etc.

Location

Daiwa
Chiyoda-ku,
Securities
Tokyo
Group Inc.

Capital stockorinvestments
in capital

247.3
billion yen

Business
description

Percentage ofvoting rights, etc.
held by related
party (held in theInvestment
Corporation)

Holdingcompany

Redemptionof investment
corporation
bonds(Held in theInvestment
Payment ofProvision of
Corporation)interest
capital
Directly: 13.45%
expenses on
Indirectly: 29.23%
investment
corporation
bonds (Notes
1 and 2)

Relationshipwith related
party

Nature oftransaction

Amount oftransaction(thousandyen)

Accounting
item

Balance at
end of period(thousandyen)

3,500,000–
28,27719th Fiscal Period [From: December 1, 2014 To: May 31, 2015]
Not applicable.
(Note 1) Issuance terms, etc. for investment corporation bonds were determined by conducting a multifaceted analysis,
including the disparity in the spread of investment corporation bonds of other similar investment corporation bonds
and the spread of senior bonds and subordinated bonds in the market (bank bonds) and verification from the spread ofsubordinated investment corporation bonds issued in the past in Japan.
(Note 2) Terms and conditions with interested persons were determined according to the regulation concerning conflict ofinterest in the internal rule of the Asset Manager.
(2) Notes to parent company and significant affiliated companies
18th Fiscal Period [From: June 1, 2014 To: November 30, 2014]
Parent company’s information
Daiwa Securities Group Inc. (listed on the Tokyo Stock Exchange and Nagoya Stock Exchange)
19th Fiscal Period [From: December 1, 2014 To: May 31, 2015]
Parent company’s information
Daiwa Securities Group Inc. (listed on the Tokyo Stock Exchange and Nagoya Stock Exchange)

25–

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Investment and Rental Properties]
The Investment Corporation has rental office buildings, etc. (including land) in Tokyo and other regions. The carrying amount,amount of increase (decrease) during period and fair value for these rental properties are as follows.
(Unit: thousand yen)
18th Fiscal Period[From: June 1, 2014
To: Nov. 30, 2014]

19th Fiscal Period[From: Dec. 1, 2014
To: May 31, 2015]

Carrying amount
Balance at beginning of period

355,783,760

378,935,080

Amount of increase (decrease) during period

23,151,320

27,764,026

Balance at end of period

378,935,080

406,699,107

370,600,000

410,990,000

Fair value at end of period(Note 1) The carrying amount is the amount after accumulated depreciation is deducted from the cost of acquisition.
(Note 2) Of the amount of increase (decrease) for rental properties during the 18th Fiscal Period, the amount of increase ismainly attributable to acquisition of Azabu Green Terrace (14,000 million yen) and Kitahama Grand Building (9,481
million yen) and the amount of decrease is mainly attributable to depreciation (1,497 million yen). Of the amount of
increase (decrease) for rental properties during the 19th Fiscal Period, the amount of increase is mainly attributable toacquisition of 6 properties (48,785 million yen), and the amount of decrease is mainly attributable to sales of 5
properties (21,325 million yen) and depreciation (1,553 million yen).
(Note 3) The fair value at end of period presents the appraisal value estimated by an external real estate appraiser.
The income (loss) for investment and rental properties are as presented in “Notes to Statements of Income.”

26

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Segment Information, etc.](1) Segment Information
Segment information has been omitted because the Investment Corporation has no segment except the property leasing
business.
(2) Related Information
18th Fiscal Period [From: June 1, 2014 To: November 30, 2014]① Information about products and services
Information about products and services has been omitted because net sales to external customers for one segment
are in excess of 90% of the operating revenue on statements of income.
② Information about geographical areas
A. Net sales
Information about net sales has been omitted because net sales to external customers in Japan are in excess of 90%of the operating revenue on statements of income.
B. Property, plant and equipment
Information about property, plant and equipment has been omitted because the amount of property, plant andequipment located in Japan is in excess of 90% of the amount of property, plant and equipment on balance sheets.
③ Information about major customers
Information about principal customers has been omitted because each net sales to a single external customer accounts
for less than 10% of the operating revenue on statements of income.
19th Fiscal Period [From: December 1, 2014 To: May 31, 2015]① Information about products and services
Information about products and services has been omitted because net sales to external customers for one segment
are in excess of 90% of the operating revenue on statements of income.
② Information about geographical areas
A. Net sales
Information about net sales has been omitted because net sales to external customers in Japan are in excess of 90%of the operating revenue on statements of income.
B. Property, plant and equipment
Information about property, plant and equipment has been omitted because the amount of property, plant andequipment located in Japan is in excess of 90% of the amount of property, plant and equipment on balance sheets.
③ Information about major customers
Information about principal customers has been omitted because each net sales to a single external customer accounts
for less than 10% of the operating revenue on statements of income.

27

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period[Notes to Per Unit Information]
18th Fiscal Period
19th Fiscal Period[From: June 1, 2014
[From: Dec. 1, 2014
To: Nov. 30, 2014]
To: May 31, 2015]
Net assets per unit
504,746 yen
505,566 yen
Net income per unit
8,414.41 yen
9,141.88 yen(Note 1) The net income per unit was calculated by dividing the net income by the daily weighted average number ofinvestment units issued and outstanding. The diluted net income per unit is not stated as there are no diluted
investment units.
(Note 2) The basis for calculating the net income per unit is as follows.
18th Fiscal Period
19th Fiscal Period[From: June 1, 2014
[From: Dec. 1, 2014
To: Nov. 30, 2014]
To: May 31, 2015]
Net income (thousand yen)
3,641,022
4,031,570
Amounts not attributable to common unitholders (thousand yen)―－
Net income attributable to common investment units (thousand yen)
3,641,022
4,031,570
Average number of investment units during the period (unit)
432,713441,000[Notes to Significant Subsequent Events](1) Issuance of Investment Units
The Investment Corporation resolved to issue new investment units at its Board of Directors meetings held on
April 27, 2015 and May 20, 2015. Payments were completed on June 1, 2015 and June 24, 2015.
a. Issuance of New Investment Units through Public Offering(i) Number of new units offered
41,045 units (domestic: 19,545units; overseas 21,500
units）(ii) Net price (paid-in price)
563,914 yen per unit(iii) Net amount (total paid-in amount)
23,145,850,130 yen(iv) Payment dateJune 1, 2015(v) Use of procured funds
To be used as funds for and various expenses associatedwith the acquisition of River Gate and part of the funds forthe repayment of borrowings for the acquisition of GlassCity Shibuya and Meguro Place Tower
b. Issuance of New Investment Units through Third-Party Allotment(i) Number of new units offered
1,955 units(ii) Net price (paid-in price)
563,914 yen per unit(iii) Net amount (total paid-in amount)
1,102,451,870 yen(iv) Allottee and number of units to be issued
Daiwa Securities Co., Ltd., 1,955 units(v) Payment dateJune 24, 2015(vi) Use of procured funds
To be used as funds for and various expenses associatedwith the acquisition of River Gate and part of the funds forthe repayment of borrowings for the acquisition of GlassCity Shibuya and Meguro Place Tower(2) Acquisition of Assets
a. The Investment Corporation acquired a trust beneficial interest in real estate on June 2, 2015 as follows.
Summary of Asset Acquired
Property nameRiver Gate

Type of asset

Trust beneficial interest in domestic real estate

Location36-2 Nihonbashi Hakozakicho, Chuo-ku, Tokyo

Acquisition price

28,000 million yen(excluding associated acquisition costs, consumption tax, etc.)

Date of conclusion of purchase agreement

April 27, 2015

Date of delivery

June 2, 2015

Seller

THAMES TMK

28

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
3.9. Increase (Decrease) in Number of Investment Units Issued and Outstanding
During the fiscal period under review, the Investment Corporation did not conduct a capital increase and there is no change to theunitholdders’ capital, etc. The overview of capital increase up to the end of the 19th Fiscal Period is as follows.

Payment date

Description

Number of investment units
issued and outstanding(units)Increase
Balance(Decrease)

Unitholders’ capital(million yen)
Increase(Decrease)

Notes

Balance

Incorporation through private
400
400
200
200 (Note 1)
placement
Capital increase through public
October 18, 2005
99,600100,000
49,49849,698 (Note 2)
offering
Capital increase through public
100,000
200,000
75,316125,015 (Note 3)
July 10, 2007
offering
Capital increase by way of a
August 7, 2007
5,000
205,000
3,765
128,781 (Note 4)
third-party allotment
Capital increase by way of a138,905
343,905
59,999188,780 (Note 5)
June 4, 2008
third-party allotment
Capital increase by way of a
July 1, 2009
51,893395,798
10,000198,780 (Note 6)
third-party allotment
Capital increase through public
41,092436,890
18,522
217,303 (Note 7)
July 2, 2014
offering
Capital increase by way of a
July 30, 2014
4,110
441,000
1,852
219,155 (Note 8)
third-party allotment(Note 1) The Investment Corporation was incorporated at an issue price of 500,000 yen per unit.
(Note 2) The Investment Corporation issued new investment units through public offering at an issue price of 515,000 yen perunit (amount paid in: 496,975 yen) to procure funds for acquisition of properties to be acquired upon listing, etc.
(Note 3) The Investment Corporation issued new investment units through public offering at an issue price of 781,060 yen perunit (amount paid in: 753,165 yen) to procure funds for acquisition of acquisition properties, etc.
(Note 4) The Investment Corporation issued new investment units by way of a third-party allotment at an issue price of 753,165
yen per unit (amount paid in: 753,165 yen) to fund part of acquisition of acquisition properties, etc.
(Note 5) The Investment Corporation issued new investment units by way of a third-party allotment at an issue price of 431,949
yen per unit (amount paid in: 431,949 yen) to fund repayment of loans and redemption of investment corporation bonds.
(Note 6) The Investment Corporation issued new investment units by way of a third-party allotment at an issue price of 192,705
yen per unit (amount paid in: 192,705 yen) to fund repayment of loans, capital expenditure to enhance property value,acquisition of property, etc.
(Note 7) The Investment Corporation issued new investment units through public offering at an issue price of 466,537 yen perunit (amount paid in: 450,746 yen) to procure funds for acquisition of acquisition properties, etc.
(Note 8) he Investment Corporation issued new investment units by way of a third-party allotment at an issue price of 450,746
yen per unit (amount paid in: 450,746 yen) to procure funds for acquisition of acquisition properties, etc.
July 11, 2005

29

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
4. Changes in Directors
4.1. Changes in Directors at the Investment Corporation
Not applicable.
4.2. Changes in Directors at the Asset Manager

Tamaki Shibayama assumed the office of auditor (executive), effective April 1, 2015.
The following is the status of directors at the Asset Manager as of the date of this document.
Title

Name

President andRepresentative
Director

Akira Yamanouchi

Brief profile
April 1986
April 2002
May 2002
March 2003
August 2004
February 2008
February 2009
July 2009

Vice President
andRepresentative
Director

Yuji Shinotsuka

April 2010
May 2010
April 1989
June 2009
July 2009

Head ofCorporate
Planning
Department

November 2009
April 2011
October 2012
December 2012
January 2014
August 2014

Vice President
andRepresentative
Director
Head of Private
FundManagement
Department

Yoshiki Nishigaki

April 1992
May 2004
February 2006
March 2007
March 2008
November 2008
May 2010
August 2010
February 2011
April 2012
October 2013
April 2014

Joined Marubeni Corporation
Joined Pacific Management Corporation
Temporarily transferred to Pacific Investment Advisors
Corporation (currently, AD Investment Management Co., Ltd.)
President and Representative Director of Pacific Investment
Advisors Corporation (with employment transfer)
Executive Director of Nippon Residential Investment
Corporation (currently, Advance Residence Investment
Corporation)
President and Representative Director of Pacific Investment
Partners Inc. (currently, Cushman & Wakefield AssetManagement K.K.)
Representative Director (part-time basis) of Pacific Holdings,
Inc.
Executive Managing Director of Cushman & Wakefield AssetManagement K.K.
Advisor of Daiwa Real Estate Asset Management Co., Ltd.
President and Representative Director (current position)
Joined Daiwa Securities Co., Ltd. (currently, Daiwa Securities
Group Inc.)
Head of Corporate Planning Department
Temporarily transferred to Daiwa Real Estate AssetManagement Co. Ltd. Vice President and Representative
Director (Head of IR & Planning Department)
Vice President and Representative Director (Head of Corporate
Planning Department)
Vice President and Representative Director (Head of Corporate
Planning Department and Finance Department)
Vice President and Representative Director (Head of Corporate
Planning Department) (current position)
Executive Office of Daiwa Residential Private Investment
Corporation (current position)
Executive Office of Japan Health Care Investment Corporation
Resigned from Executive Office of Japan Health Care
Investment Corporation
Joined Cititrust & Banking Corporation
Joined K.K. daVinci Advisors
Transferred to K.K. daVinci Select (currently, Daiwa Real
Estate Asset Management Co. Ltd.)
Head of IR & Business Planning Department
President and Representative Director
Executive Director, DA Office Investment Corporation
Vice President and Representative Director, Daiwa Real Estate
Asset Management Co. Ltd.
Resigned from Executive Director, Daiwa Office Investment
Corporation
Vice President and Representative Director (Head of Advisory
Department)
Vice President and Representative Director (Head of FundManagement Department)
Vice President and Representative Director (Head Customer
Relations and Fund Management Department)
Vice President and Representative Director (Head of FundManagement Department) (current position)
30

Number of shares
owned (shares)―――

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

Title
Director

Name
Naoyuki
Owa

Head of
Administration
Department

Brief profile
April 1986
April 1990
June 2006
October 2006
July 2009

Director(non-executive)

Toshihiro Matsui

April 1985
May 2004
April 2005
October 2005
October 2006
April 2007
October 2008
April 2009
July 2009
April 2011
April 2014

Director(non-executive)

Mikita Komatsu

April 1985
October 2005
October 2008
April 2010
April 2011
April 2012
April 2013

Auditor(executive)

Tamaki Shibayama

April 1982
September 1986
April 1999
April 2002
October 2010
April 2012
April 2015

Number of shares
owned (shares)

Joined Tokyo High Court as Court Administrative Official
Joined Daiwa Securities Co., Ltd. (currently, Daiwa Securities
Group Inc.)
Head of Corporate Planning Department and Treasury
Department of Daiwa Securities SMBC Co., Ltd.
Head of Corporate Planning Department of Daiwa Securities
Group Inc.
Temporarily transferred to Daiwa Real Estate AssetManagement Co. Ltd. Director (Head of Administration
Department) (current position)
Joined Daiwa Securities Co., Ltd. (currently, Daiwa Securities
Group Inc.)
Head of Corporate Institutions Department (V) of Daiwa
Securities SMBC Co., Ltd.
Head of Corporate Institutions Department (IV)
Head of Corporate Finance Department
Head of Corporate Finance Department (I)Head of Fixed Income, Currency and Commodities (FICC)
Department
Head of Corporate Planning Department of Daiwa Securities
Group Inc.
Executive Officer
Director (part-time basis) of Daiwa Real Estate AssetManagement Co. Ltd. (current position)
Executive Managing Director of Daiwa Securities Group Inc.
Senior Managing Director of Daiwa Securities Group Inc.
(current position)
Joined Daiwa Securities Co., Ltd. (currently Daiwa Securities
Group Inc.)
Head of Finance Department, Daiwa Securities Group Inc.
President of Daiwa Securities SMBC Europe Limited (currently
Daiwa Capital Markets Europe Limited)
Senior Managing Director, Daiwa Securities Capital Markets
Co., Ltd.
Senior Managing Director , Daiwa Securities Group Inc.
Director (non-executive) of Daiwa Real Estate AssetManagement Co. Ltd. (current position)
Executive Managing Director of Daiwa Securities Group Inc.
(current position)
Joined the Japan Chamber of Commerce and Industry―
Joined Daiwa Securities Co., Ltd. (currently Daiwa Securities
Group Inc.)
Transferred to Daiwa Securities Capital Markets Co., Ltd.
General Manager of Initial Public Offering Department of
Daiwa Securities SMBC Co., Ltd.
Head of Corporate Auditor’s Office of Daiwa Securities CapitalMarkets Co., Ltd.
Managing Director of Corporate Clients Banking Department(VII) of Daiwa Securities Co., Ltd.
Auditor of Daiwa Real Estate Asset Management Co. Ltd.
(current position)

31

―

―

―

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
Title

Name

Auditor(non-executive)

Masaru Shirataki

Brief profile
April 1985
April 2004
October 2009
April 2011
April 2013
June 2013

Auditor(non-executive)

Shinji Kiso

April 2001
December 2009
July 2011
June 2013
May 2014
June 2015

Number of shares
owned (shares)

Joined Daiwa Securities Co., Ltd. (currently, Daiwa Securities
Group Inc.)
General Manager of Corporate Planning Department of Daiwa
Securities SMBC Co., Ltd.
General Manager of Legal Department of Daiwa Securities
Group Inc.
General Manager of Internal Audits of Daiwa Securities GroupInc.
Director of Daiwa Securities Group Inc. Auditor (non-executive)of Daiwa Real Estate Asset Management Co. Ltd. (current
position)
Director of Daiwa Securities Group Inc. (current position)―

Joined Daiwa Securities SMBC Co., Ltd. (currently, Daiwa
Securities Co., Ltd.)
Corporate Planning Department of Daiwa Securities Group Inc.
(current position)
Corporate Planning Department of Daiwa Securities Co., Ltd.
(current position)
Director (non-executive) of ASTMAX Co., Ltd. (current
position)
Auditor (non-executive) of Daiwa Real Estate AssetManagement Co. Ltd. (current position)
Director (non-executive) of Money Partners Group Co., Ltd.
(current position)―

32

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

5. Reference Information
5.1. Investment Status
Type of asset
Real estate

Trust beneficial interestin real estate

Use
OfficeOfficeRegion19th Fiscal Period(As of May 31, 2015)
Total amount owned
As a percentage of total(million yen) (Note 1)
assets (%)

Five Central Wards of Tokyo

16,218

3.8

Five Central Wards of Tokyo

336,18177.8

Greater Tokyo

34,6348.0

Major Regional Cities

19,664

4.5

406,699

94.1

25,5335.9

432,232100.0[406,699][94.1]

Total
Deposits and other assets
Total amount of assets (Note 2)(Note 1) The total amount owned is the carrying amount (the book value after deducting depreciation in the case of real estate andtrust beneficial interest in real estate).
(Note 2) The figures in parentheses [ ] under “Total amount of assets” shows the portion of the applicable asset that, in effect,
corresponds to the holding of real estate properties. The amount of construction in progress (including construction inprogress in trust) is not included in the amount of real estate and trust beneficial interest in real estate.

- 33 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
5.2. Investment Real Estate Properties (As of May 31, 2015)
5.2.1. Price and Investment Ratio of Investment Real Estate Properties
Acquisition
Type ofprice
RegionProperty namespecifiedasset
Daiwa Ginza
Daiwa Ginza Annex

Five
CentralWards of
Tokyo
(Note 1)

Real estate

Investment
ratio
(%)
(Note 7)

Carrying
amountEstimated price at
end of period(million yen)(million yen)(million yen)

(Note 4)(Note 5)(Note 6)

14,10013,372

15,500

3.4

3,050

2,845

3,170

0.7

Daiwa Shibaura

8,265

8,040

7,240

2.0

Daiwa Minami-Aoyama

4,550

4,467

4,140

1.1

Daiwa Sarugakucho

3,190

3,220

3,270

0.8

Daiwa A Hamamatsucho (Note 8)

2,865

2,821

3,070

0.7

Daiwa Jingumae

2,800

2,698

2,180

0.7

Daiwa Shibadaimon

2,578

2,405

2,700

0.6

Daiwa Misakicho

2,346

2,205

2,560

0.6

Daiwa Shimbashi 510

2,080

2,138

2,400

0.5

Daiwa Tsukijiekimae

1,560

1,367

1,490

0.4

Daiwa Tsukiji

1,240

1,177

1,330

0.3

Daiwa Tsukishima

7,840

7,060

8,940

1.9

Daiwa Nihonbashi Horidomecho

2,520

2,504

2,410

0.6

Daiwa Azabudai

1,600

1,550

1,700

0.4

Daiwa Kyobashi

3,460

3,327

3,120

0.8

Daiwa Kojimachi 4-chome

2,910

2,860

2,600

0.7

Daiwa Onarimon

13,86013,49812,6003.4

133,800

130,254

113,000

32.4

5,900

5,738

4,520

1.4

2,460

2,417

2,020

0.6

4,150

4,120

3,110

1.0

Daiwa Nishi-Shimbashi

5,000

4,908

5,060

1.2

Daiwa Kudan

4,000

3,848

3,220

1.0

Daiwa Kayabacho Building

5,600

5,423

7,080

1.4

Shinjuku Maynds Tower (Note 8)
SHIBUYA EDGE
Daiwa Kodenmacho
Daiwa Jimbocho

Trustbeneficial
interest inreal estate

Daiwa Jimbocho 3-chome

3,550

3,488

4,170

0.9

E SPACE TOWER

24,00023,75331,000

5.8

Daiwa Nihonbashi Hongokucho

1,721

1,667

2,000

0.4

shinyon curumu

9,650

9,883

11,400

2.3

Daiwa Shibuya Dougenzaka

4,500

4,489

5,790

1.1

Daiwa Akasaka

9,200

9,305

11,2002.2

Daiwa Shibuya Miyamasuzaka

7,000

7,200

7,840

1.7

Azabu Green Terrace

14,00014,335

15,600

3.4

Daiwa Ebisu 4-chome

4,135

4,171

4,720

1.0

LAQUAS Higashi Shinjuku

8,450

8,674

9,400

2.0

Concept Aoyama

9,800

10,066

10,600

2.4

Shinsen Place

4,800

4,934

5,720

1.2

Glass City Shibuya

16,00016,15517,0003.9

358,530

352,399354,870

86.8

Total for Five Central Wards of Tokyo (38 properties)- 34 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
Carrying
amountEstimated price at
end of period(million yen)(million yen)(million yen)

(Note 4)(Note 5)(Note 6)

Daiwa Higashi-Ikebukuro

2,958

2,767

3,340

0.7

Daiwa Shinagawa North

7,710

7,318

5,780

1.9

1,650

1,663

2,120

0.4

RegionGreaterTokyo(Note 2)

Investment
ratio
(%)
(Note 7)

Acquisition
price

Property nameDaiwa Osaki 3-chome
Daiwa Kamiooka
Integral Tower

Type ofspecified
asset

Trust
beneficial
interest inreal estate

Meguro Place Tower
Total for Greater Tokyo (6 properties)
Major
Daiwa Minami-Senba
Regional
Daiwa Meieki
Cities(Note 3) Kitahama Grand Building

Trustbeneficial
interest inreal estate

Total for Major Regional Cities (3 properties)

2,000

2,006

2,260

0.5

15,22015,21816,800

3.7

5,600

5,660

5,810

1.4

35,13834,634

36,110

8.5

4,810

4,705

2,570

1.2

5,300

5,385

6,840

1.3

9,481

9,573

10,6002.3

19,591
19,66420,010
4.7
Total (47 properties)
413,259
406,699
410,990100.0(Note 1) “Five Central Wards of Tokyo” means Chiyoda, Chuo, Minato, Shinjuku and Shibuya wards.
(Note 2) “Greater Tokyo” means Tokyo excluding the Five Central Wards of Tokyo, Kanagawa, Chiba and Saitama prefectures.
(Note 3) “Major Regional Cities” means Osaka area (i.e., Osaka, Kyoto and Hyogo prefectures), Nagoya area (Aichi, Mie andGifu prefectures) and ordinance-designated cities and core cities under the Local Autonomy Act.
(Note 4) Acquisition price is excluding acquisition costs, fixed property tax, city planning tax, consumption tax and local
consumption tax.
(Note 5) Carrying amount is the book value after deducting depreciation as of May 31, 2015.
(Note 6) Estimated price at end of period is the price as of May 31, 2015 stated in appraisal reports prepared by real estateappraisers of Tanizawa Sogo Appraisal Co., Ltd., Daiwa Real Estate Appraisal Co., Ltd., Morii Appraisal & Investment
Consulting, Inc. and Japan Real Estate Institute in accordance with the articles of incorporation of the Investment
Corporation and the rules of The Investment Trusts Association, Japan.
(Note 7) Investment ratio is the acquisition price of each property expressed as a percentage of the total amount of acquisition
prices, rounded to one decimal place.
(Note 8) For Daiwa A Hamamatsucho Building and Shinjuku Maynds Tower, the figures are those pertaining to the Investment
Corporation’s ownership interest.

- 35 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
5.2.2. Summary of Building and Leasing of Investment Real Estate
RegionProperty nameDaiwa Ginza
Daiwa Ginza Annex
Daiwa Shibaura
Daiwa Minami-Aoyama
Daiwa Sarugakucho (Note 8)
Daiwa A Hamamatsucho
Daiwa Jingumae
Daiwa Shibadaimon
Daiwa Misakicho (Note 8)
Daiwa Shimbashi 510
Daiwa Tsukijiekimae
Daiwa Tsukiji
Daiwa Tsukiji 616 (Note 9)
Five Central Daiwa Tsukishima
Wards ofTokyo
Daiwa Nihonbashi Horidomecho
Daiwa Azabudai
Daiwa Nihombashi Honcho (Note 10)
Daiwa Ginza 1-chome (Note 10)
Daiwa Kyobashi
Daiwa Kojimachi 4-chome
Daiwa Onarimon
Shinjuku Maynds Tower (Note11)
SHIBUYA EDGE
Daiwa Kodenmacho
Daiwa Jimbocho
Daiwa Nishi-Shimbashi
Daiwa Kudan
Daiwa Kayabacho Building (Note 8)

Structureandnumber offloors(Note 1)SRC
B3 / 12F
SRC
B3 / 8F
SRC
B1 / 12FS / SRC
B2 / 5F
SRC
8F
SRC
B2 / 10FRC
B1 / 4F
SRC / RC
B1 / 7F
S
8F
SRC
B1 / 8F
SRC
10F
SRC
B1 / 7F
SRC
B1 / 9F
S
5F
SRC
B2 / 7F
SRC
B2 / 9F
SRC
B1 / 10F
SRC
B2 / 11F
SRC
B1 / 8F
SRC
B2 / 9F
SRC
9F
S / SRC
B3 / 34F
RC
B1 / 9F
SRC
8FS
B1 / 8F
SRC
B1 / 10F
SRC
9F
S / SRC
B1 / 8F

Rent revenue
Occupancy
during current
rate
period(%)(thousand yen)
(Note 6)(Note 7)

Construction
completion(Note 2)

Leasable
floor area(m2)
(Note 3)

Leased floor
area
(m2)
(Note 4)

Total
number oftenants(Note 5)

July 1963

8,175.26

7,510.63

27

91.8

367,353

Aug. 1972

2,032.11

2,032.11

7

100.0

88,001

Oct. 1987

9,619.67

9,578.76

55

99.5

216,998

Sept. 1990

2,715.53

2,715.53

6

100.0

124,553

June 1985

3,657.43

3,657.43

1

100.0

-

July 1993

3,663.38

3,663.38

12

100.0

127,409

Dec. 1997

2,198.61

2,198.61

4

100.0

54,108

Nov. 1996

2,386.48

2,386.48

6

100.0

82,615

July 1996

2,137.53

2,137.53

1

100.0

-

Apr. 1974

2,676.52

2,668.12

7

99.6

84,407Jan. 1996

2,659.59

2,659.59

6

100.0

56,052

Jan. 1990

1,487.82

1,328.52

4

89.2

44,253Mar. 1994

-

-

-

-

39,997

July 1996

8,426.85

8,426.853

100.0

281,035

Apr. 1993

2,850.81

2,850.81

9

100.0

75,660

Apr. 1984

1,697.88

1,697.88

10

100.0

50,730Jan. 1964

-

-

-

-

60,520Jan. 1962

-

-

-

-

19,701

Oct. 1974

3,265.83

3,265.83

9

100.0

96,186

Oct. 1987

2,690.90

2,690.90

7

100.0

91,276

Apr. 1973

11,614.92

11,614.92

7

100.0

275,733

Sept. 1995

45,543.97

45,012.19

36

98.8

2,446,339

Aug. 2006

2,480.65

2,480.65

5

100.0

118,063

Mar. 1985

2,379.31

2,379.31

8

100.0

62,500Mar. 1997

3,164.26

3,164.26

7

100.0

96,403

July 1993

4,815.84

4,639.65

11

96.3

138,606

Mar. 1987

2,882.61

2,882.61

6

100.0

93,484

Apr. 2010

5,899.11

5,899.11

1

100.0

-

- 36 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

RegionProperty nameDaiwa Jimbocho 3-chome
E SPACE TOWER
Daiwa Nihonbashi Hongokucho
shinyon curumu
Daiwa Shibuya Dougenzaka
Daiwa Akasaka
Daiwa Shibuya Miyamasuzaka
Azabu Green Terrace
Daiwa Ebisu 4-chome (Note 8)
LAQUAS Higashi Shinjuku
Concept Aoyama
Shinsen Place (Note 8)
Glass City Shibuya

Structureandnumber offloors(Note 1)S
9F
S / SRC
B1 / 15F
S
8F
S / RC
B2 / 11F
SRC
B1/11F
SRC
B2/7F
S
B1/12FS / RC
B1 / 6F
SRC
B1/9
S
10F
S/RC
B1/7F
RC
B1/9F
S/SRC
B1/11F

Leasable
floor area(m2)
(Note 3)

Leased floor
area
(m2)
(Note 4)

Total
number oftenants(Note 5)

Feb. 2010

2,889.34

2,889.34

8

100.0

99,248Oct. 2002

13,960.87

13,471.97

5

96.4

706,695

May 2010

2,143.08

2,143.08

6

100.0

59,671

Jan. 2012

6,751.31

6,751.31

18

100.0

299,253

Mar. 1988

4,144.90

4,144.90

5

100.0

143,967

Sept. 1990

8,794.51

7,554.29

18

85.8

282,847

Dec. 1988

6,327.95

6,327.95

8

100.0

231,356

Sept. 2009

13,234.39

13,234.39

10

100.0

438,746

Dec. 1997

2,743.93

0.00

0

0.0

-

Aug. 2010

7,498.33

7,498.33

4

100.0

219,543

Nov. 2001

4,420.18

3,798.32

4

85.9

106,858

Sept. 2001

2,811.35

2,811.35

1

100.0

-

Feb. 2004

8,566.73

8,566.73

11

100.0

64,611

225,409.74

218,733.62

353

97.0

8,326,673

Jan. 1992

-

-

-

-

48,586

June 1993

4,461.47

4,461.47

7

100.0

105,678

Feb. 1994

-

-

-

-

84,591

July 1991

6,548.82

5,898.62

12

90.0

176,838

Sept. 2007

1,786.06

1,786.06

5

100.0

42,095

Total for Five Central Wards of Tokyo (41 properties)
Daiwa Kinshicho (Note 10)
Daiwa Higashi-Ikebukuro
Benex S-3 (Note 9)
Daiwa Shinagawa North
GreaterTokyo

Daiwa Osaki 3-chomeS
B1 / 5F
SRC / S
B1 / 9FS / SRC
B1 / 12F
SRC
B1 / 11F
S / RC
B1 / 6F

Daiwa Kamiooka

S / SRC
B3 / 7F

May 2011

2,630.30

2,630.30

9

100.0

73,873Integral Tower (Note 12)

S/SRC
B2/18F

June 1993

17,778.14

17,697.94

999.5

550,204

Meguro Place Tower

S/SRC
B2/14F

July 2009

3,519.50

3,519.50

15

100.0

23,99136,724.29

35,993.89

57

98.0

1,105,859

Sept. 1986

5,719.52

5,719.52

11

100.0

100,533

Dec. 2007

7,461.90

7,357.22

23

98.5

244,181Feb. 2008

13,517.62

13,517.62

6

100.0

335,219

26,699.04
288,833.07

26,594.36
281,321.87

40
450

99.6
97.3

679,934
10,112,468

Total for Greater Tokyo (8 properties)
Daiwa Minami-Senba
Major
Regional
CitiesRent revenue
Occupancy
during current
rate
period(%)(thousand yen)
(Note 6)(Note 7)

Construction
completion(Note 2)

Daiwa Meieki
Kitahama Grand Building

SRC
B1 / 8F
S
12F
S / SRC
B1 / 16F

Total for Major Regional Cities (3 properties)
Total (52 properties)(Note 1) “Structure and number of floors” are the entries in the real estate registry of the building of the applicable investment
real estate property. “S” refers to steel-framed structure, “RC” refers to reinforced concrete structure, “SRC” refers tosteel-framed reinforced concrete structure, “B” refers to floors below ground and “F” refers to floors above ground.
(Note 2) “Construction completion” is the entry in the real estate registry of the building of the applicable investment real estate
property.

- 37 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period(Note 3) “Leasable floor area” represents the floor area of the building of the applicable property that is leasable, not including
the leasable area of the land (including level parking space), and is the floor area indicated in the lease contract, etc. as of
May 31, 2015.
(Note 4) “Leased floor area” is the sum total of the floor area that is actually leased based on lease agreements, etc. executed with
end-tenants as of May 31, 2015.
(Note 5) “Total number of tenants” is the number of end-tenants. When there is a tenant occupying multiple buildings, theconcerned tenant is counted and stated for each individual building.
(Note 6) “Occupancy rate” is the figure arrived at when leased floor area is divided by leasable floor area, rounded down to one
decimal place.
(Note 7) “Rent revenue during current period” is rent income, common area charges income, parking lot income and otherincome generated from the applicable investment real estate property during the 19th Fiscal Period, rounded down to thenearest thousand yen.
(Note 8) Not shown for such reasons as consent was not obtained from major tenants to disclose the rent revenue during current
period for the properties.
(Note 9) The property was sold as of March 5, 2015. This is reflected, in respective totals, in the number of properties and rent
revenue during current period.
(Note 10) The property was sold as of February 2, 2015. This is reflected, in respective totals, in the number of properties and rent
revenue during current period.
(Note 11) The real estate in trust pertaining to trust beneficial interest held by the Investment Corporation is the common
ownership interest corresponding to six-sevenths of the entire property. Accordingly, leasable floor area and leased floorarea are the floor areas corresponding to six-sevenths of the entire building.
(Note 12) The buildings consist of three registrations. Of these, the details of the major building are shown here.

- 38 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
5.2.3. Capital Expenditures for Assets under Management
A. Capital Expenditures for 19th Fiscal Period
The following are the principal capital expenditures arising from renovation construction work, etc. currently planned forexisting portfolio properties. Please note that the expected construction amount includes portions that are expensed as aseparate account item of accounting costs.
Name of real estate properties(Location)

Expected construction amount (million yen)Amount paid
Total amount
Total amountduring current period
already paid

Scheduled
implementation
periodPurposeShinjuku Maynds Tower(Shibuya-ku, Tokyo)

Renovation work for central

Daiwa Ebisu 4-chome(Shibuya-ku, Tokyo)

Renovation work for air-conditioning

Shinjuku Maynds Tower(Shibuya-ku, Tokyo)

Upgrading of main central supervisory

Daiwa Akasaka(Minato-ku, Tokyo)

Establishment of entrance on the

supervisory systemsystemsystem VAV and controller
public open space side

From: Oct. 2013
To: Sept. 2015

297

74

131

From: July 2015
To: Nov. 2015

121

－

－

From: Oct. 2013
To: Sept. 2015

110

33

49

From: Jan. 2015
To: Sept. 2015

101

65

－

B. Capital Expenditures during 19th Fiscal Period
The following summarizes the primary construction work that constitutes capital expenditures implemented during the 19th
Fiscal Period. Capital expenditures for the 19th Fiscal Period amounted to 905 million yen and, when combined with the 227
million yen in repair expenses charged to 19th Fiscal Period expenses, totals 1,132 million yen in construction work
implemented.
Name of real estate properties(Location)
Shinjuku Maynds Tower(Shibuya-ku, Tokyo)
Daiwa Tsukishima Building(Chuo-ku, Tokyo)
Daiwa Jimbocho(Chiyoda-ku, Tokyo)

PurposeConstruction amount paid
(million yen)

PeriodCVCF upgrading work and renovation work for disasterprevention facilities

From: Oct. 2013
To: Mar. 2015373

From: Mar. 2015
To: May 2015
From: Apr. 2015
To: May 2015
From: Dec. 2014
To: May 2015

Upgrading of air-conditioning system
Upgrading of air-conditioning system

Other

90
57
384

Total

905

C. Reserve Amount for Long-Term Repair Plans (Reserve for Repairs)
The Investment Corporation sets aside the following reserve for repairs from cash flows during the fiscal period for thepayment of future major repairs.
(Unit: million yen)
15th
16th
17th
18th
19th
FiscalPeriodFiscalPeriodFiscalPeriodFiscalPeriodFiscalPeriodFiscal period[From: Dec. 1, 2012
To: May 31, 2013]

Balance of reserve at
beginning of previous
periodAmount of reserve incurrent period
Reversal of reserve incurrent period
Amount carried forward to
next period[From: June 1, 2013
To: Nov. 30, 2013][From: Dec. 1, 2013
To: May 31, 2014][From: June 1, 2014
To: Nov. 30, 2014][From: Dec. 1, 2014
To: May 31, 2015]

611

806

830

1,021

1,199

619

181

794

764

1,678

424

156

603

586

135

806

830

1,021

1,199

2,742

- 39 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

5.2.4. Summary of Estimated Price at End of Period (As of May 31, 2015)

Property nameDaiwa Ginza
Daiwa Ginza Annex
Daiwa Shibaura
Daiwa Minami-Aoyama
Daiwa Sarugakucho
Daiwa A Hamamatsucho (Note 2)
Daiwa Jingumae
Daiwa Shibadaimon
Daiwa Misakicho
Daiwa Shimbashi 510
Daiwa Tsukijiekimae (Note 3)
Daiwa Tsukiji
Daiwa Tsukishima
Daiwa Nihonbashi Horidomecho
Daiwa Azabudai
Daiwa Kyobashi
Daiwa Kojimachi 4-chome
Daiwa Onarimon
Shinjuku Maynds Tower (Note 4)
SHIBUYA EDGE
Daiwa Kodenmacho
Daiwa Jimbocho
Daiwa Nishi-Shimbashi
Daiwa Kudan
Daiwa Kayabacho Building
Daiwa Jimbocho 3-chome
E SPACE TOWER
Daiwa Nihonbashi Hongokucho
shinyon curumu
Daiwa Shibuya Dougenzaka
Daiwa Akasaka
Daiwa Shibuya Miyamasuzaka
Azabu Green Terrace
Daiwa Ebisu 4-chome
LAQUAS Higashi Shinjuku
Concept Aoyama
Shinsen Place
Glass City Shibuya
Daiwa Higashi-Ikebukuro
Daiwa Shinagawa North
Daiwa Osaki 3-chome
Daiwa Kamiooka
Integral Tower

Estimated priceat end of period(million yen)
(Note 1)

Summary of Appraisal Report
Direct capitalization method
Price(million yen)

Cap rate(%)

DCF method
Price(million yen)

Discount Terminal
cap rate
rate
(%)
(%)

15,50015,8004.0

15,100

3.8

4.2

3,170

3,220

3.9

3,120

3.7

4.1

7,240

7,350

4.5

7,190

4.3

4.7

4,140

4,210

4.3

4,070

4.1

4.5

3,270

3,320

4.8

3,220

4.6

5.0

3,070

3,130

4.3

3,050

4.1

4.5

2,180

2,190

4.2

2,160

4.0

4.4

2,700

2,770

4.1

2,670

3.9

4.3

2,560

2,590

4.4

2,550

4.2

4.6

2,400

2,430

4.5

2,370

4.3

4.7

1,490

1,500

4.7

1,480

4.7

4.9

1,330

1,320

4.6

1,340

4.6

4.8

8,940

9,020

4.6

8,900

4.3

4.8

2,410

2,450

4.5

2,370

4.3

4.7

1,700

1,720

4.4

1,680

4.2

4.6

3,120

3,170

4.4

3,060

4.2

4.6

2,600

2,750

4.1

2,540

3.9

4.3

12,60012,9004.2

12,3004.0

4.4

113,000

140,000

3.7

129,000

3.5

3.9

4,520

4,620

4.1

4,420

3.9

4.3

2,020

2,040

4.7

1,990

4.5

4.9

3,110

3,210

4.5

3,070

4.5

4.7

5,060

5,200

4.3

5,000

4.1

4.5

3,220

3,380

4.3

3,170

4.3

4.5

7,080

7,190

3.9

7,030

3.7

4.1

4,170

4,270

3.9

4,120

3.7

4.1

31,00031,2003.8

30,800

3.5

3.9

2,000

2,050

4.5

1,980

4.3

4.7

11,40011,5003.8

11,300

3.6

4.0

5,790

6,040

4.0

5,680

3.8

4.2

11,20011,4003.8

11,100

3.6

4.0

7,840

7,890

4.0

7,790

3.7

4.1

15,60015,900

4.1

15,300

3.9

4.3

4,720

4,810

4.2

4,680

4.0

4.4

9,400

9,760

3.8

9,240

3.6

4.0

10,60010,9003.8

10,500

3.6

4.0

5,720

5,760

3.9

5,700

3.8

4.1

17,00017,2003.8

16,800

3.5

3.9

3,340

3,400

4.7

3,320

4.5

4.9

5,780

5,830

4.7

5,730

4.5

4.9

2,120

2,150

4.3

2,110

4.1

4.5

2,260

2,250

5.1

2,270

4.9

5.3

16,80017,1004.3

16,600

4.1

4.5- 40 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

Property name

Estimated priceat end of period(million yen)
(Note 1)

Summary of Appraisal Report
Direct capitalization method
Price(million yen)

Cap rate(%)

DCF method
Price(million yen)

Discount Terminal
cap rate
rate
(%)
(%)

5,810
6,030
4.1
5,710
3.9
4.3
Meguro Place Tower
2,570
2,630
5.2
2,510
5.0
5.4
Daiwa Minami-Senba
6,840
6,990
4.7
6,780
4.7
4.9
Daiwa Meieki
10,60010,9004.3
10,500
4.1
4.5
Kitahama Grand Building
410,990
443,440
423,370
Total(Note 1) “Estimated price at end of period” is the price as of May 31, 2015stated in appraisal reports prepared by real estateappraisers of Tanizawa Sogo Appraisal Co., Ltd., Daiwa Real Estate Appraisal Co., Ltd., Morii Appraisal & Investment
Consulting, Inc. and Japan Real Estate Institute in accordance with the articles of incorporation of the Investment
Corporation and the rules of The Investment Trusts Association, Japan.
(Note 2) For Daiwa A Hamamatsucho, the prices are those pertaining to the Investment Corporation’s ownership interest.
(Note 3) Discount rate for Daiwa Tsukijiekimae is the figure after the 4th fiscal year (4.5% in 1st year and 4.6% in 2nd and 3rd
fiscal years).
(Note 4) For Shinjuku Maynds Tower, the estimated price at end of period is the price pertaining to the Investment Corporation’sownership interest, and the price indicated by the direct capitalization method and price indicated by the DCF method
are the prices pertaining to the entire Property.

- 41 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
5.2.5. Status of Income (Loss), etc. of Individual Properties
The following table lists the status of income (loss), etc. of each property for the 19th Fiscal Period (from December 1,
2014 to May 31, 2015). Income (loss) information is presented in accordance with “3. Financial Statements; 3.7. Notes to
Significant Accounting Policies” outlined earlier.
RegionPrice
information

Five Central Wards of Tokyo

Acquisition date

Oct. 2005

Oct. 2005

Oct. 2005

Oct. 2005

Oct. 2005

Acquisition price (million yen)

14,100

3,050

8,265

4,550

3,190

3.4

0.7

2.0

1.1

0.8

Carrying amount (million yen)

13,372

2,845

8,040

4,467

3,220

Estimated price at end of period(million yen)

15,500

3,170

7,240

4,140

3,270

Number of tenants (Note 1)

Daiwa
Shibaura

Daiwa
Sarugakucho(Note 4)

Daiwa
Ginza

Investment ratio (%)

Daiwa
Ginza Annex

Daiwa
MinamiAoyama

Property name

27

7

55

6

1

Leasable floor area (m2)8,175.26

2,032.11

9,619.67

2,715.53

3,657.43

Leased floor area (m2)

7,510.63

2,032.11

9,578.76

2,715.53

3,657.43

End of May 2013

96.4

100.0

87.4

94.1

100.0

End of Nov. 2013

86.9

100.0

90.2

94.1

100.0

End of May 2014

92.6

100.0

98.7

100.0

100.0

End of Nov. 2014

92.1

100.0

98.3

100.0

100.0

End of May 2015

91.8

100.0

99.5

100.0

100.0

182

182

182

182

182

375,771

88,001

219,019

124,553－

Rent revenue – real estate

367,353

88,001

216,998

124,553－

Other lease business revenue

8,417

－

2,020

－

－

181,361

40,51789,00842,825－

Consignment expenses

22,0695,455

16,084

5,507－

Utilities expenses

29,155

7,330

23,2007,947－

Taxes and dues

27,551

9,080

19,203

11,715－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousand
yen)

Total property leasing expenses (B) (thousandyen)

Income (loss)
information

Reference
information

Non-life insurance expenses

433

100

404

146

－

Repair expenses

19,659

828

4,602

5,410

－

Depreciation (C)70,64917,72325,492

12,097－

Other lease business expenses

11,841

－

20

－

－

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

194,40947,483130,01181,727－

NOI (E) [(D) + (C)] (thousand yen)

265,058

65,207

155,50393,82585,510Capital expenditures (F) (thousand yen)

13,064

8,335

1,473

29,072655

NCF [(E) – (F)] (thousand yen)

251,994

56,871

154,030

64,75384,855

Expense rate (%) [(B) ÷ (A)]

48.26

46.04

40.64

34.38

－

55,966

18,05338,66823,24013,349346,060

86,510347,210

185,215

171,199

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 42 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Five Central Wards of Tokyo

Property nameDaiwa A
Hamamatsucho

Daiwa Jingumae

Daiwa
Shibadaimon

Acquisition date

Oct. 2005

Oct. 2005

Oct. 2005

Oct. 2005

Oct. 2005

Acquisition price (million yen)

2,865

2,800

2,578

2,346

2,080

Daiwa Misakicho Daiwa Shimbashi(Note 4)510

Investment ratio (%)

0.7

0.7

0.6

0.6

0.5

Carrying amount (million yen)

2,821

2,698

2,405

2,205

2,138

Estimated price at end of period(million yen)

3,070

2,180

2,700

2,560

2,400

Number of tenants (Note 1)

12

4

6

1

7

Leasable floor area (m2)

3,663.38

2,198.61

2,386.48

2,137.53

2,676.52

Leased floor area (m2)

3,663.38

2,198.61

2,386.48

2,137.53

2,668.12

End of May 2013

100.0

100.0

100.0

100.0

99.7

End of Nov. 2013

100.0

100.0

100.0

100.0

99.4

End of May 2014

100.0

100.0

100.0

100.0

99.4

End of Nov. 2014

100.0

100.0

100.0

100.0

99.6

End of May 2015

100.0

100.0

100.0

100.0

99.6

182

182

182

182

182

127,409

54,10882,615－84,407

127,409

54,10882,615－84,407

－

－

－

－

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

Reference
information

73,621

26,00230,674－

28,674

Consignment expenses

10,193

4,348

6,827

－

5,042

Utilities expenses

10,513

5,613

7,146

－

6,599

Taxes and dues

8,657

6,305

6,240

－

5,555
110

Non-life insurance expenses

183

81

112

－

Repair expenses

827

2,274

665

－

4,218

Depreciation (C)13,845

7,372

9,681

－

7,146

Other lease business expenses

29,4007－－－

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

53,78828,10551,941－

55,733

NOI (E) [(D) + (C)] (thousand yen)

67,63335,47861,62362,97462,879

Capital expenditures (F) (thousand yen)

12,482

1,343

6,936

－

24,972

NCF [(E) – (F)] (thousand yen)

55,151

34,13454,686

62,97437,907

Expense rate (%) [(B) ÷ (A)]

57.78

48.06

37.13

－

33.97

17,302

12,73012,144

10,325

11,344100,430

117,930

150,927

182,856

169,555

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 43 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Five Central Wards of Tokyo
Daiwa
Tsukiji 616(Note 5)

Daiwa
TsukijiDaiwa
Nihonbashi
Horidomecho

Property name

Daiwa
Tsukijiekimae

Acquisition dateJan. 2006

Jan. 2006

Mar. 2006

Mar. 2006

May 2006

Acquisition price (million yen)

1,560

1,240

－

7,840

2,520

Daiwa
Tsukishima

Investment ratio (%)

0.4

0.3

－

1.9

0.6

Carrying amount (million yen)

1,367

1,177

－

7,060

2,504

Estimated price at end of period(million yen)

1,490

1,330

－

8,940

2,410

Number of tenants (Note 1)

6

4

－

3

9

Leasable floor area (m2)2,659.59

1,487.82－

8,426.85

2,850.81

Leased floor area (m2)2,659.59

1,328.52－

8,426.85

2,850.81

End of May 2013

10.3

100.0

100.0

100.0

100.0

End of Nov. 2013

100.0

100.0

100.0

100.0

100.0

End of May 2014

100.0

100.0

100.0

100.0

100.0

End of Nov. 2014

100.0

100.0

100.0

100.0

87.8

End of May 2015

100.0

89.2

－

100.0

100.0

182

182

94

182

182

56,052

44,25339,997

281,035

75,66056,052

44,25339,997

281,035

75,660

－

－

－

－

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

30,16820,15730,955130,990

34,133

Consignment expenses

4,185

3,638

2,500

12,338

6,543

Utilities expenses

6,989

3,437

4,813

26,6785,870

Taxes and dues

5,028

3,823

8,997

13,191

6,564

Non-life insurance expenses

96

54

63

301

125

Repair expenses

381

1,966

529

26,091

1,085

Depreciation (C)13,4707,237

14,051

52,387

13,944

18

－

－

－

－

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

25,88424,0969,041

150,044

41,527

NOI (E) [(D) + (C)] (thousand yen)

39,354

31,33323,093

202,432

55,471Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information

664

100

－

90,4197,651

NCF [(E) – (F)] (thousand yen)

38,69031,23323,093112,01347,820

Expense rate (%) [(B) ÷ (A)]

53.82

45.55

77.39

46.61

45.11

10,113

7,673－

27,278

13,167

120,530

109,848－

102,930

234,846

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 44 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Five Central Wards of Tokyo

Property nameDaiwa Azabudai

Daiwa
Nihombashi
Honcho (Note 5)

Daiwa
Ginza 1-chome(Note 5)

Daiwa Kyobashi

Daiwa Kojimachi
4-chomeAcquisition date

May 2006

July 2006

July 2006

July 2006

Oct. 2006

Acquisition price (million yen)

1,600

－

－

3,460

2,910

Investment ratio (%)

0.4

－

－

0.8

0.7

Carrying amount (million yen)

1,550

－

－

3,327

2,860

Estimated price at end of period(million yen)

1,700

－

－

3,120

2,600

Number of tenants (Note 1)

10

－

－

9

7

Leasable floor area (m2)

1,697.88－－

3,265.83

2,690.90

Leased floor area (m2)

1,697.88－－

3,265.83

2,690.90

End of May 2013

100.0

97.6

89.0

99.5

96.0

End of Nov. 2013

100.0

97.3

98.3

100.0

100.0

End of May 2014

100.0

87.3

99.2

100.0

100.0

End of Nov. 2014

100.0

88.1

71.0

100.0

100.0

End of May 2015

100.0

－

－

100.0

100.0

182

63

63

182

182

52,38860,52019,701

96,284

91,276

Rent revenue – real estate

50,73060,52019,701

96,186

91,276

Other lease business revenue

1,658

－

－

97

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousand
yen)

Total property leasing expenses (B) (thousandyen)

Income (loss)
information

25,40446,012

26,67144,071

41,955

Consignment expenses

4,724

9,116

3,758

6,086

5,969

Utilities expenses

3,800

7,265

2,970

9,493

8,588

Taxes and dues

4,809

13,820

9,205

7,027

14,702Non-life insurance expenses

81

97

48

133

130

Repair expenses

3,567

813

630

2,320

1,125

Depreciation (C)8,420

14,89810,05819,01011,440

－

－

－

－

－

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

26,983

14,507(6,970)52,212

49,320NOI (E) [(D) + (C)] (thousand yen)

35,40429,406

3,088

71,22360,760Capital expenditures (F) (thousand yen)

6,693

－

－

24,2481,161

NCF [(E) – (F)] (thousand yen)

28,71029,406

3,088

46,97459,598

Expense rate (%) [(B) ÷ (A)]

48.49

76.03

－

45.77

45.97

9,804

－

－

14,09829,627108,280－－

140,200

169,753

Other lease business expenses

Reference
information

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 45 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Five Central Wards of Tokyo

Property nameDaiwa Onarimon

Shinjuku Maynds
Tower

Acquisition date

Dec. 2006

July 2007 andNov. 2007

Acquisition price (million yen)

13,860Investment ratio (%)

SHIBUYAEDGE

Daiwa
Kodenmacho

Daiwa Jimbocho

July 2007

Aug. 2007

Mar. 2010

133,800

5,900

2,460

4,150

3.4

32.4

1.4

0.6

1.0

Carrying amount (million yen)

13,498130,254

5,738

2,417

4,120

Estimated price at end of period(million yen)

12,600113,000

4,520

2,020

3,110

Number of tenants (Note 1)

7

36

5

8

7

Leasable floor area (m2)

11,614.92

45,543.97

2,480.65

2,379.31

3,164.26

Leased floor area (m2)

11,614.92

45,012.19

2,480.65

2,379.31

3,164.26

End of May 2013

100.0

94.9

100.0

100.0

100.0

End of Nov. 2013

100.0

95.7

100.0

100.0

100.0

End of May 2014

100.0

94.7

100.0

100.0

100.0

End of Nov. 2014

100.0

94.0

100.0

100.0

100.0

End of May 2015

100.0

98.8

100.0

100.0

100.0

182

182

182

182

182

275,733

2,446,339

118,063

62,50096,403

275,733

2,446,339

118,063

62,50096,403

－

－

－

－

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

113,763

1,148,800

39,36023,19751,798

Consignment expenses

19,187

161,690

5,946

4,108

7,191

Utilities expenses

26,200295,862

8,103

5,275

9,301

Taxes and dues

33,647

253,151

7,254

3,609

10,609Non-life insurance expenses

414

3,610

107

81

139

Repair expenses

3,905

44,543

1,953

377

4,918

Depreciation (C)30,407

386,048

15,995

8,921

19,377

－

3,893

－

822

261

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

161,969

1,297,539

78,70239,30344,605

NOI (E) [(D) + (C)] (thousand yen)

192,377

1,683,587

94,69748,224

63,98264,945

Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information

3,305

405,637

8,744

15,000

NCF [(E) – (F)] (thousand yen)

189,072

1,277,949

85,95333,224(963)

Expense rate (%) [(B) ÷ (A)]

41.26

46.96

33.34

37.12

53.73

69,806494,235

14,493

7,274

21,498459,880

4,460,870

62,460100,234

128,200

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 46 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionProperty nameAcquisition date

Price
information

Five Central Wards of Tokyo
Daiwa
NishiShimbashi

Daiwa
Kayabacho
Building(Note 4)

Daiwa
Kudan

Daiwa Jimbocho3-chomeE-SPACE
TOWER

Aug. 2010

Sept. 2010

Mar. 2011

Mar. 2011

July 2011

Acquisition price (million yen)

5,000

4,000

5,600

3,550

24,000Investment ratio (%)

1.2

1.0

1.4

0.9

5.8

Carrying amount (million yen)

4,908

3,848

5,423

3,488

23,753

Estimated price at end of period(million yen)

5,060

3,220

7,080

4,170

31,000

Number of tenants (Note 1)

11

6

1

8

5

Leasable floor area (m2)

4,815.84

2,882.61

5,899.11

2,889.34

13,960.87

Leased floor area (m2)

4,639.65

2,882.61

5,899.11

2,889.34

13,471.97

End of May 2013

100.0

100.0

100.0

100.0

100.0

End of Nov. 2013

100.0

100.0

100.0

100.0

100.0

End of May 2014

100.0

100.0

100.0

88.1

89.1

End of Nov. 2014

100.0

100.0

100.0

100.0

100.0

End of May 2015

96.3

100.0

100.0

100.0

96.4

182

182

182

182

182

138,606

101,125－

99,248706,695

138,606

93,484－99,248706,695

－

7,641

－

－

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

79,726

48,694－44,805

237,840

Consignment expenses

15,769

6,972

－

7,577

57,470Utilities expenses

12,424

8,304

－

7,744

55,152

Taxes and dues

15,610

8,456

－

9,322

56,336

Non-life insurance expenses

237

117

－

122

645

Repair expenses

2,295

424

－

316

3,607

Depreciation (C)33,387

24,419－19,72264,125

3

－

－

－

503

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

58,88052,430－54,443468,855

NOI (E) [(D) + (C)] (thousand yen)

92,26776,850120,911

74,165532,980

Capital expenditures (F) (thousand yen)

10,347

－

－

－

9,824

NCF [(E) – (F)] (thousand yen)

81,92076,850120,911

74,165523,155

Expense rate (%) [(B) ÷ (A)]

57.52

48.15

－

45.14

33.66

31,167

17,441

25,06018,757

113,750

187,140

141,450

38,44026,390317,590

Other lease business expenses

Reference
information

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2) (Note 3)- 47 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Five Central Wards of Tokyo

Property name

Daiwa
Nihonbashi
Hongokucho

Acquisition date

May 2012

Acquisition price (million yen)shinyoncurumuDaiwa Shibuya
Dougenzaka

Daiwa Akasaka

Daiwa Shibuya
Miyamasuzaka

Dec. 2012 andApr. 2013

July 2013

Aug. 2013

Sept. 2013

1,721

9,650

4,500

9,200

7,000

Investment ratio (%)

0.4

2.3

1.1

2.2

1.7

Carrying amount (million yen)

1,667

9,883

4,489

9,305

7,200

Estimated price at end of period(million yen)

2,000

11,4005,790

11,2007,840

Number of tenants (Note 1)

6

18

5

18

8

Leasable floor area (m2)2,143.08

6,751.31

4,144.90

8,794.51

6,327.95

Leased floor area (m2)2,143.08

6,751.31

4,144.90

7,554.29

6,327.95

End of May 2013

100.0

55.9

－

－

－

End of Nov. 2013

100.0

67.5

100.0

95.6

100.0

End of May 2014

100.0

96.3

100.0

100.0

100.0

End of Nov. 2014

100.0

100.0

100.0

85.8

100.0

End of May 2015

100.0

100.0

100.0

85.8

100.0

182

182

182

182

182

59,671

300,364

143,967

282,847

231,356

59,671

299,253

143,967

282,847

231,356

－

1,111

－

－

－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

25,582

119,782

63,960120,189

89,076

Consignment expenses

3,963

26,084

14,707

23,90421,016

Utilities expenses

3,964

24,30014,08838,32919,288

Taxes and dues

13,57032,82420,307

4,418

33,424Non-life insurance expenses

76

326

209

425

296

Repair expenses

－

205

3,418

1,608

6,668

Depreciation (C)13,16035,441

17,96623,09721,453

－

－

－

－

45

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

34,088

180,582

80,006

162,657

142,280

NOI (E) [(D) + (C)] (thousand yen)

47,248216,023

97,973

185,755

163,734

Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information－

12,2891,150

55,54030,360

NCF [(E) – (F)] (thousand yen)

47,248203,733

96,823130,215

133,373

Expense rate (%) [(B) ÷ (A)]

42.87

39.88

44.43

42.49

38.50

8,829

67,174

27,16765,88939,906

22,401

65,855230,176

430,612416,816

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 48 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionFive Central Wards of Tokyo

Property name

Azabu Green
TerraceAcquisition date

Daiwa Ebisu
4-chome (Note4)

Jul. 2014

Dec. 2014

LAQUAS Higashi
Shinjuku
Dec. 2014

Concept AoyamaMar. 2015

Shinsen Place(Note 4)Mar. 2015

Acquisition price (million yen)

14,000

4,135

8,450

9,800

4,800

Investment ratio (%)
Price
information Carrying amount (million yen)

3.4

1.0

2.0

2.4

1.2

14,335

4,171

8,674

10,066

4,934

Estimated price at end of period(million yen)

15,600

4,720

9,400

10,600

5,720

10

0

4

4

1

13,234.39

2,743.93

7,498.33

4,420.18

2,811.35

13,234.39

0.00

7,498.33

3,798.32

2,811.35

End of May 2013

－

－

－

－

－

End of Nov. 2013

－

－

－

－

－

End of May 2014

－

－

－

－

－

End of Nov. 2014

100.0

－

－

－

－

End of May 2015

100.0

0.0

100.0

85.9

100.0

182

182

180

91

91

440,135－

219,543

106,858－

Rent revenue – real estate

438,746－

219,543

106,858－

Other lease business revenue

1,388

－

－

－

－

143,044－

58,154

17,273－

Consignment expenses

31,953－

10,747

6,275－

Utilities expenses

52,617－

14,282

2,177－

Taxes and dues

186

－

13

2

－

Non-life insurance expenses

610

－

310

78

－

Repair expenses

7,461

－

283

155

－

Depreciation (C)50,213－32,2908,523－

Number of tenants (Note 1)
2

Leasable floor area (m )2Leased floor area (m )Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousand
yen)

Total property leasing expenses (B) (thousandyen)

Income (loss)
information

Other lease business expenses

－

－

226

60

－

Operating income (loss) from property
leasing (D) [(A) – (B)] (thousand yen)

297,090－

161,389

89,585－

NOI (E) [(D) + (C)] (thousand yen)

347,304

10,397

193,679

98,10864,443

2,255

915

－

－

－

NCF [(E) – (F)] (thousand yen)

345,049

9,482

193,679

98,10864,443

Expense rate (%) [(B) ÷ (A)]

32.50

－

26.49

16.16

－

63,232

17,84240,367－－325,054

115,410

125,440

97,530112,510

Capital expenditures (F) (thousand yen)

Reference
information

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 49 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period

Price
information

RegionFive Central
Wards of Tokyo

Property nameGlass City
Shibuya

Greater Tokyo
Daiwa Kinshicho
Daiwa(Note 5)
Higashi-Ikebukuro

Benex S-3
(Note 5)

Daiwa Shinagawa
North

Acquisition date

May 2015

Oct. 2005

Oct. 2005

May 2006

July 2007

Acquisition price (million yen)

16,000

－

2,958

－

7,710

Investment ratio (%)

3.9

－

0.7

－

1.9

Carrying amount (million yen)

16,155

－

2,767

－

7,318

Estimated price at end of period(million yen)

17,000

－

3,340

－

5,780

Number of tenants (Note 1)

11

－

7

－

12

Leasable floor area (m2)

8,566.73－

4,461.47－

6,548.82

Leased floor area (m2)

8,566.73－

4,461.47－

5,898.62

End of May 2013

－

100.0

100.0

98.2

100.0

End of Nov. 2013

－

100.0

100.0

93.6

100.0

End of May 2014

－

100.0

92.2

98.2

100.0

End of Nov. 2014

－

100.0

100.0

100.0

100.0

End of May 2015

100.0

－

100.0

－

90.0

31

63

182

94

182

64,611

48,586105,678

84,591

188,738

64,611

48,586105,678

84,591

176,838

－

－

－

－

11,9008,775

41,96560,012

71,616

102,932

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)Consignment expenses

Income (loss)
information

3,306

4,615

10,623

8,905

15,606

Utilities expenses

－

7,316

13,711

14,93018,433

Taxes and dues

10

14,054

8,809

20,542

18,541

Non-life insurance expenses

61

84

232

188

352

Repair expenses

38

725

3,546

1,087

16,761

Depreciation (C)5,359

15,16923,08925,961

33,236

－

－

－

－

－

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

55,835

6,620

45,666

12,97485,805

NOI (E) [(D) + (C)] (thousand yen)

61,194

21,79068,75538,936

119,042

Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information

－

－

8,153

－

11,782

NCF [(E) – (F)] (thousand yen)

61,194

21,79060,601

38,936107,260

Expense rate (%) [(B) ÷ (A)]

13.58

86.37

56.79

84.66

54.54

－

－

17,118－35,791

202,340－

228,260－

331,160

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses(thousand yen) (Note 2)- 50 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionProperty nameAcquisition date

Price
information

Major Regional
CitiesGreater Tokyo
Daiwa Osaki
3-chomeDaiwa
Kamiooka

Integral Tower

Meguro Place
Tower

Daiwa
Minami-Senba

Sept. 2012

Mar. 2013

May 2014

May 2015

Aug. 2007

Acquisition price (million yen)

1,650

2,000

15,220

5,600

4,810

Investment ratio (%)

0.4

0.5

3.7

1.4

1.2

Carrying amount (million yen)

1,663

2,006

15,218

5,660

4,705

Estimated price at end of period(million yen)

2,120

2,260

16,800

5,810

2,570

Number of tenants (Note 1)

5

9

9

15

11

Leasable floor area (m2)

1,786.06

2,630.30

17,778.14

3,519.50

5,719.52

Leased floor area (m2)

1,786.06

2,630.30

17,697.94

3,519.50

5,719.52

End of May 2013

100.0

100.0

－

－

100.0

End of Nov. 2013

100.0

92.2

－

－

100.0

End of May 2014

88.4

85.4

96.7

－

75.7

End of Nov. 2014

100.0

85.4

99.5

－

95.7

End of May 2015

100.0

100.0

99.5

100.0

100.0

182

182

182

31

182

42,09573,873550,204

23,991

100,533

42,09573,873550,204

23,991

100,533

－

－

－

－

－

25,88838,998244,011

6,344

77,370

7,406

8,830

51,463

2,546

21,035
11,502
10,567

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)Consignment expenses

Income (loss)
information

Utilities expenses

3,237

5,748

92,364－

Taxes and dues

3,939

6,443

236

15

Non-life insurance expenses

68

116

885

29

232

Repair expenses

187

130

7,655

－

1,650

Depreciation (C)11,04817,73091,226

3,753

32,192

－

－

180

－

188

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

16,20734,874306,192

17,64623,163

NOI (E) [(D) + (C)] (thousand yen)

27,25552,604397,418

21,40055,356－726

18,798－

9,968

NCF [(E) – (F)] (thousand yen)

27,25551,877

378,619

21,40045,388

Expense rate (%) [(B) ÷ (A)]

61.50

52.79

44.35

26.45

76.96

7,807

12,71588,050－21,01537,912

24,782

834,324

110,053

184,360

Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses (thousandyen) (Note 2)- 51 -

Daiwa Office Investment Corporation (8976) Financial Report for the 19th Fiscal Period
RegionPrice
information

Major Regional Cities

Property nameDaiwa Meieki

Kitahama Grand
Building

Acquisition dateFeb. 2013

Aug. 2014

Acquisition price (million yen)

5,300

9,481

Investment ratio (%)

1.3

2.3

Carrying amount (million yen)

5,385

9,573

Estimated price at end of period(million yen)

6,840

10,600

Number of tenants (Note 1)

23

6

Leasable floor area (m2)

7,461.90

13,517.62

Leased floor area (m2)

7,357.22

13,517.62

End of May 2013

85.4

－

End of Nov. 2013

81.3

－

End of May 2014

98.4

－

End of Nov. 2014

100.0

100.0

End of May 2015

98.5

100.0

182

182

244,181335,219

244,181335,219－－

Occupancy rate (%)
Leasing
information

Number of days of asset management
Total property leasing revenue (A) (thousandyen)
Rent revenue – real estate
Other lease business revenue
Total property leasing expenses (B) (thousandyen)

Income (loss)
information

95,513

117,600

Consignment expenses

20,96824,834

Utilities expenses

18,57036,706

Taxes and dues

19,844－Non-life insurance expenses

386

589

Repair expenses

773

2,443

Depreciation (C)34,97052,931－

96

Operating income (loss) from property leasing(D) [(A) – (B)] (thousand yen)

148,667

217,618

NOI (E) [(D) + (C)] (thousand yen)

183,637

270,550

1,181

5,146

NCF [(E) – (F)] (thousand yen)

182,456

265,403

Expense rate (%) [(B) ÷ (A)]

39.12

35.08

40,30365,871

170,803

264,054

Other lease business expenses

Capital expenditures (F) (thousand yen)

Reference
information

Annual amount of fixed property tax, etc. forfiscal 2015 (thousand yen)
Estimated long-term repair expenses (thousandyen) (Note 2)(Note 1) Number of tenants is the number of end-tenants. When there is a tenant occupying multiple buildings, the concerned tenant iscounted and stated for each individual building.
(Note 2) Estimated long-term repair expenses are the total amount of repair expenses and renewal expenses estimated to arise over the
12-year period from the 1st year to the 12th year as stated in the building investigation diagnosis report.
(Note 3) Estimated long-term repair expenses of “Daiwa Kayabacho Building” are the total amount of repair expenses and renewal
expenses estimated to arise over the 10-year period from the 1st year to the 10th year as stated in the building investigation
diagnosis report.
(Note 4) Not disclosed for such reasons as consent was not obtained from major tenants to disclose the rent revenue, etc. for the property.
(Note 5) “Daiwa Kinshicho,” “Daiwa Nihombashi Honcho” and “Daiwa Ginza 1-chome” were sold as of February 2, 2015 and “Daiwa
Tsukiji 616” and “Benex S-3” were sold as of March 5, 2015.

- 52 -