Provisional translation only

June 29, 2018
Fukuoka REIT Corporation
1-2-25 Sumiyoshi, Hakata Ward, Fukuoka City
Etsuo Matsuyuki
CEO & Representative Director(Securities Code: 8968)
Asset Management Company:
Fukuoka Realty Co., Ltd.
1-2-25 Sumiyoshi, Hakata Ward, Fukuoka City
Etsuo Matsuyuki
CEO & Representative Director
Inquiries:
Keishi Tamura
General Manager of Finance Department
TEL: +81-(0)92-272-3900

Fukuoka REIT Corporation Concludes Agreement to Purchase New Property
Fukuoka REIT Corporation (FRC) announces that Fukuoka Realty Co., Ltd., the asset management company towhich FRC entrusts the management of its assets, decided to acquire the following domestic real estate today.
1. Summary of Acquisition
Property nameUsePark Place Oita Daiichi
ParkingParkingLocation
1-chome Koen Dori
Nishi, Oita City

Acquisition price(planned)

Acquisition date(planned)

860 million yen

July 6, 2018

2. Reason for Acquisition
FRC invests primarily in retail properties with excellent design and entertainment qualities and Class A officebuildings, focusing on the Fukuoka and Kyushu region. Other than retail properties and office buildings, FRC
also works to acquire properties which, by capitalizing on its community-based strengths to establish
appropriate management structures for each property and through other measures, will allow it to secure stableearnings over the medium to long term. By incorporating such properties into its portfolio, FRC intends topursue risk diversification within the region.
Park Place Oita Daiichi Parking (hereafter, the “Property”), the property to be acquired, is a parking lot
exclusively for customers of Park Place Oita already owned by FRC and is the nearest parking lot to thecenter of Park Place Oita among parking lots located outside the premises. The facility currently has parking
available for approximately 4,000 vehicles with a high occupancy rate, and becomes nearly full on weekends,
holidays, etc. Of the people who visit Park Place Oita, approximately 90 percent use cars as a means fortransport and FRC believes that securing additional lots to accommodate such demand is an important issue.
The Property to be acquired is owned by FUKUOKA JISHO CO.,LTD., a sponsor of the asset managementcompany, as residential land for sale and is used as a parking lot exclusively for customers of Park Place Oita.
FUKUOKA JISHO CO.,LTD. had been considering selling the land. In the case that a third party other than
FRC acquired the Property and used it other than as a parking lot, the capacity of the parking lot would havebeen reduced and risks such as increased congestion on weekends, holidays, etc. in surrounding areas as well
as a decrease in the number of visitors could be presumed. Thus, it was judged that FRC acquiring theProperty is most appropriate for the operation of Park Place Oita.
FRC believes the acquisition of the Property enables integrated management and operation of the Property-1-together with Park Place Oita and expects the abatement of any risk of decrease in number of visitors due toshortage of parking lots.
3. Details of Property for Acquisition(1) Overview of Acquisition
1) Asset to be acquired (Note 1):

Real estate trust beneficiary interest(Trustee: Sumitomo Mitsui Trust Bank, Limited (planned))
2) Property name:Park Place Oita Daiichi Parking3) Acquisition price (planned) (Note 2): 860 million yen
4) Appraisal value:867 million yen (as of June 1, 2018)5) Acquisition date (planned):
July 6, 20186) Seller:
FUKUOKA JISHO CO.,LTD.
7) Funding:
Cash on hand
8) Payment method:
Lump-sum payment upon delivery(Note 1)
(Note 2)

Although the asset to be acquired is in the form of actual real estate at present, the current owner plans to place it
in a trust for the trustee and FRC plans to acquire the beneficiary interest in said trust by the planned acquisition
date.
The acquisition price (planned) does not include acquisition expenses, amounts equivalent to the settlement ofproperty taxes and city planning taxes, consumption taxes on the building and other expenses.

(2) Overview of Asset to be acquired
Property namePark Place Oita Daiichi Parking
Asset to be acquired

Real estate trust beneficiary interest

Acquisition price (planned)

860 million yen

Trustee

Sumitomo Mitsui Trust Bank, Limited (planned)

Term of real estate trust

From July 6, 2018 to November 30, 2027(planned)

Location (address)

6675-6, 1-chome Koen Dori Nishi, Oita City and seven other lots

Land

Building

Area

26,018 m2Zoning

Class-2 residential area

Floor space ratio

200％

Building coverage

60％

Type of ownership

Ownership

Structure/floor-Built-Total floor space-Use-

Type of ownership-Appraisal value

867 million yen (as of June 1, 2018)

Appraiser

Japan Real Estate InstituteCollateral

None

MLPM Company

FJ. Entertainment Works Co.,Ltd. (planned)

Earthquake PML-Special note

None(*) Figures for location and area are based on the indication on the registry.

-2-(3) Outline of Leasing
For the Property, a lease agreement for land for parking was concluded. The agreement is to be finalizedwith the acquisition of the Property. Accordingly, other annual leasing expenses are planned to be reduced
by around 12 million yen for Park Place Oita.
(4) Outline of Lease
Company name
Address
Activities
Representative title andname
Specified capital

FUKUOKA JISHO CO.,LTD.
2-25, 1-chome, Sumiyoshi, Hakata Ward, Fukuoka City
1. Engaged in urban development and Leasing
2. Operating Management of retail facilities and consulting business3. Insurance agency
Ichiro Enomoto, President and C.E.O
4,000 million yen (as of May 31, 2017)

Establishment

July 19, 1961

Net assets

146,822 million yen (as of May 31, 2017)

Total assets

52,708 million yen (as of May 31, 2017)

Relationship with FRC and the asset management company
Capitalrelationship
Personnelrelationship
Businessrelationship

Related parties ornot

The seller is a shareholder of FRC’s asset management company,
Fukuoka Realty Co., Ltd., with equity of 50%. The company also
owns 66,075 investment units of FRC as of February 28, 2018).
The seller has dispatched two part-time directors to the asset
management company.
The seller has such transactions with FRC and the asset
management company as property management services, brokerageof real estate transactions and lease of properties owned by FRC.
There is no relationship to note between the affiliates or affiliatedcompanies of the seller and the affiliates or affiliated companies of
FRC and the asset management company.
The seller falls within the scope of related parties of FRC.
The seller falls within the scope of parent company, etc., designatedin the Financial Instruments and Exchange Act, of the asset
management company.

(5) Profile of Previous Owners
Property name
Status of previous owners
Company name
Relationship with special
interested parties
Background and reasonof acquisition, etc.

Park Place Oita Daiichi ParkingOwner
FUKUOKA JISHO CO.,LTD.
A shareholder of the asset managementcompany (with equity of 50%)

Previous owner－(Note 1)

For the purpose of development－－

Omitted as the owner has owned the－property for over 1 year
Acquisition dateApril, 2009－(Note 1) The previous owner is a corporation that was absorbed by the owner, FUKUOKA JISHO CO.,LTD., as ofAcquisition priceMarch 1, 2011(6) Sales Agent ProfileNone-3-

(7) Form of Payment
FRC is scheduled to pay the acquisition fee in full on the scheduled acquisition date (July 6, 2018) with cashon hand.
(8) Transaction with Interested Parties
1) FUKUOKA JISHO CO.,LTD., the seller of the Property, falls within the scope of interested parties of theasset management company. Accordingly, the asset management company has conducted discussions andobtained approval from its Investment Management Committee, Compliance Assessment Committee andBoard of Directors concerning the acquisition price and other terms for the Property, pursuant to theregulations and other rules of the asset management company.
2) FRC plans to conclude a real estate lease and management consignment agreement with FJ. Entertainment
Works Co.,Ltd., in order to consign the latter with the tenant management and property management workfor the Property. The same procedures for discussions and approvals as 1) above have been followed forconcluding the agreement.
(9) Acquisition Schedule
June 29, 2018
July 6, 2018
July 6, 2018
July 6, 2018

Decision of acquisition
Conclusion of agreement (planned)
Payment (planned)
Delivery of the property (planned)

4. Outlook
As the impact of the acquisition on FRC’s operating forecast for the fiscal period ending August 2018 (March1, 2018 – August 31, 2018) and for the fiscal period ending February 2019 (September 1, 2018 – February 28,2019), which were announced in the “Earnings Briefing for the Period Ended February 2018” dated April 12,2018 is minimal, there will be no changes to the forecast.
5. Overview of Appraisal Report
Property nameAppraiser
Appraisal value
Pricing date
Value indicated by thecomparison approachsales

Value indicated by the DCF method fordevelopment projectPark Place Oita Daiichi Parking
Japan Real Estate Institute867,000,000 yen
As of June 1, 2018
Figures

Reasons, etc.

861,000,000 yenAssumed cases where the subject

867,000,000 yen

property is reclaimed and a low-rise
store is developed, operated and sold.

*This document was distributed to Kabuto Club (press club within the Tokyo Stock Exchange), Press Club for
the Ministry of Land, Infrastructure, Transport and Tourism, Construction Trade Paper Press Club for theMinistry of Land, Infrastructure, Transport and Tourism, Fukuoka Economic Press Club, and Fukuoka
Securities Finance Press Club
*Fukuoka REIT Corporation’s website is http://www.fukuoka-reit.jp/eng/-4-(Attachments)
Reference 1: Location of the Property
Reference 2: Map of FRC’s Portfolio
Reference 3: FRC Portfolio List-5-

Reference 1: Location of the Property-6-Reference 2: Map of FRC’s Portfolio-7-Reference 3: FRC Portfolio List

Use

Property Name

Acquisition Date(planned)

Acquisition
Price (planned)(mm yen)(Note 1)

Acquisition
Cap Rate(NCF basis)(Note 2)

Investment
Ratio

Canal City Hakata

Nov. 9, 2004

32,000

6.0%

16.6%

Canal City Hakata・B

Mar. 2, 2011

28,700

5.4%

14.9%

18,620

6.0%

9.6%Park Place Oita

Nov. 9, 2004
(Initial acquisition)
May 28, 2015
(Additionalacquisition of a partof land)
Sep. 1, 2016
(Additionalacquisition of a partof land and building)July 6, 2018
(Additional
acquisition of a partof land)

RetailSunLiveCity Kokura

Jul. 1, 2005

6,633

6.6%

3.4%

Konoha Mall Hashimoto

Mar. 1, 2018

10,000

5.3%

5.2%

Square Mall Kagoshima
Usuki

Sep. 28, 2006

5,300

6.3%

2.7%

Kumamoto
Intercommunity SC

Nov. 30, 2006

2,400

6.5%

1.2%

Hanahata SC

Sep. 3, 2007

1,130

6.4%

0.6%

Kurume Higashi
Kushiwara SCFeb. 1, 2008

2,500

6.1%

1.3%

K’s Denki Kagoshima

Mar. 27, 2008

3,550

5.7%

1.8%

May 1, 2015

5,250

5.5%

2.7%

Canal City BusinessCenter Building

Nov. 9, 2004

14,600

6.3%

7.6%

Gofukumachi BusinessCenter

Nov. 9, 2004

11,200

6.3%

5.8%

Marinoa City Fukuoka(Marina Side Building)
Officebuildings-8-Others

Sanix Hakata Building

Sep. 30, 2005

4,400

5.9%

2.3%

Taihaku Street BusinessCenterMar. 16, 2006

7,000

6.0%

3.6%

Higashi Hie BusinessCenterMar. 13, 2009

5,900

6.0%

3.1%

Tenjin Nishi-Dori
Center Building

Feb. 1, 2013

2,600

5.4%

1.3%

Tenjin North Front
Building

Mar. 28, 2013

2,8006.1%

1.4%

Higashi Hie BusinessCenter II

Mar. 1, 2018

4,230

4.9%

2.2%

Amex Akasakamon
Tower

Sep. 1, 2006

2,060

5.4%

1.1%

City House Keyaki Dori

Dec. 20, 2007

1,111

5.5%

0.6%

Aqualia Chihaya

Mar. 1, 2012

1,280

6.8%

0.7%

D-Wing Tower

Mar. 1, 2013

2,800

5.9%

1.4%

Granfore Yakuin
MinamiNov. 4, 2014

1,100

5.6%

0.6%

Hotel FORZA Oita

Mar. 1, 2013

1,530

6.6%

0.8%

Tosu Logistics Center

Mar. 28, 2014

1,250

5.9%

0.6%

LOGICITY MinatoKashii

Mar. 27, 2015

8,150

5.2%

4.2%

LOGICITY Hisayama

Jun. 1, 2017

5,050

－

193,144

Total or weighted average of allproperties

5.1%（Note3）5.8%

2.6%
100.0%(Note 1) All figures in the Acquisition Price (planned) column indicate the acquisition price written in the sales agreement
between FRC and the seller, and exclude charges, taxes and other expenses.
(Note 2) Figures in the Acquisition Cap Rate column have been calculated using the direct capitalization method: NCF/planned
acquisition value x 100 (%) of the appraisal assessment and rounded off to the first decimal place. The Acquisition CapRate for Park Place Oita is calculated using the total of direct capitalization method NCFs and acquisition prices statedin the appraisal reports for Park Place Oita acquired on November 9, 2004, the adjacent land (parking (land)) acquired
on May 28, 2015, Sports Club NAS Park Place Oita acquired on September 1, 2016 and Park Place Oita Daiichi
Parking to be acquired on July 6, 2018
(Note 3) Does not include a solar power generating system.

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