Summary of Financial Results for the Fiscal Period Ended February 28, 2018 (REIT)
Name of Issuer

Stock Exchange
ListingWebsite

April 13, 2018
Tokyo Stock Exchange

Securities Code

Mitsubishi Estate Logistics REIT
Investment Corporation
3481

Representative

Masaki Sakagawa, Executive Director

Asset Management Company
Representative
Inquiries

Mitsubishi Jisho Investment Advisors, Inc.
Akinori Nakajo, President & CEO
Masaki Sakagawa, Senior Executive Director, General Manager, Logistics REITManagement Department
Tel. 81-3-3218-0030

Scheduled date of submission of security report:
Scheduled date of commencement of distribution
payout:May 28, 2018
May 21, 2018

Supplementary materials for financial results:
Investors and Analysts Meeting:

Yes
Yes

https://mel-reit.co.jp/en/(Amounts less than 1 million yen have been rounded down)
1. Financial Results for the Fiscal Period Ended February 28, 2018 (September 1, 2017 to February 28, 2018)(1) Management Status(% figures denote year-on-year change)
Operating revenues
Operating income
Ordinary income
Net income
Millions of yen% Millions of yen% Millions of yen% Millions of yen
Fiscal period
ended Feb. 28,2018
Fiscal period
ended Aug. 31,
2017

2,042

964.2

1,243－

1,074－

1,073－

191

18.4

91

2.0

70

2.3

43(2.5)

Net income per unit
Yen
Fiscal period
ended Feb. 28,
2018
Fiscal period
ended Aug. 31,
2017(Note 1)
(Note 2)%Return on unitholders’ Ratio of ordinary income Ratio of ordinary incomeequity
to total assets
to operating revenues
%
%
%

5,389

3.8

2.5

52.6

5,441

2.1

1.1

36.8

A 0.4-for-1 reverse split of investment units was conducted, with June 15, 2017 as the effective date. Net income per unit is calculated on thebasis that the reverse split of investment units was conducted at the beginning of the fiscal period ended August 31, 2017.
Mitsubishi Estate Logistics REIT Investment Corporation (“MEL”) issued 198,000 new investment units on September 13, 2017 and 8,000
new investment units on October 10, 2017. Net income per unit in the fiscal period ended February 28, 2018 is calculated by the daily
weighted average number of investment units (199,149 units).

-1-(2) Distributions
Total amount
Total amount
Distributions
DistributionsofTotal amountofper unit
Surplus cash
per unit
Ratio ofdistributionsof surplus
distributions Payout(excludingdistributions(includingdistributions(excludingcash(includingratio
surplus cash
per unit
surplus cash
to net assets
surplus cash
distributions
surplus cash
distributions)distributions)distributions)distributions)Fiscal period
ended Feb.
28, 2018
Fiscal period
ended Aug.
31, 2017(Note 1)
(Note 2)

(Note 3)

Yen

Millions ofyen

YenMillions ofyen

YenMillions ofyen

%%

5,015

1,073

565

120

5,580

1,194

100.0

2.0

5,441

43－－

5,441

43

100.0

2.1

The total amount of surplus cash distributions in the fiscal period ended February 28, 2018 is a refund of contributions that correspond to “acapital distribution with decrease of investment capital, etc.” under taxation law.
The ratio of decreased surplus, etc. is 0.003 as a result of surplus cash distributions (a refund of contributions that correspond to “a capitaldistribution with decrease of investment capital, etc.” under taxation law) in the fiscal period ended February 28, 2018. The ratio ofdecreased surplus, etc. is calculated on the basis of the provisions of Article 23, paragraph 1, item 4 of the Order for Enforcement of theCorporation Tax Act.
With the issuance of new investment units conducted in the fiscal period ended February 28, 2018, the payout ratio is calculated using thefollowing formula.
Payout ratio = Total amount of distributions (excluding surplus cash distributions)/Net income ×100(3) Financial Position
Millions of yen

Millions of yen

Unitholders’ equity tototal assets%

78,11254,75870.1

255,882

6,242

2,043

32.7

255,441

Total assets
Fiscal period
ended Feb. 28,2018
Fiscal period
ended Aug. 31,
2017(Note)Net assets

Net assets per unit
Yen

A 0.4-for-1 reverse split of investment units was conducted, with June 15, 2017 as the effective date. Net assets per unit are calculated on thebasis that the reverse split of investment units was conducted at the beginning of the fiscal period ended August 31, 2017.

(4) Cash Flows

Fiscal period
ended Feb. 28,
2018
Fiscal period
ended Aug. 31,
2017Cash flows fromoperating activities
Millions of yen

Cash flows frominvesting activities
Millions of yen(468)(65,163)

69,043

4,166256

(4)

(44)

754-2-Cash flows from
Cash and cash equivalents
financing activities
Millions of yen
Millions of yen2. Forecast for the Fiscal Period Ending August 31, 2018 (March 1, 2018 to August 31, 2018) and the Fiscal PeriodEnding February 28, 2019 (September 1, 2018 to February 28, 2019)(% figures denote year-on-year change)
Operatingrevenues

Fiscal period
ending Aug.
31, 2018
Fiscal period
ending Feb.
28, 2019

OperatingincomeOrdinary
incomeNet income

Distributions
Distributions
per unit
Surplus cash
per unit(including(excluding distributions
surplus cash
per unit
distributions) surplus cashdistributions)

Millionsof yen%Millionsof yen%Millionsof yen%Millionsof yen%YenYen

Yen

2,171

6.3

1,052(15.4)

994(7.4)

993

(7.4)

5,249

4,643

606

2,136

(1.6)

1,008

(4.2)

950

(4.4)

949

(4.4)

5,249

4,438

811

(Reference) Expected net income per unit: (Fiscal period ending August 31, 2018) 4,643 yen
Expected net income per unit: (Fiscal period ending February 28, 2019) 4,438 yen* Other(1) Changes in accounting policies, changes in accounting estimates, or retrospective restatements(i) Changes in accounting policies due to revisions to accounting standards, etc.: None(ii) Changes in accounting policies other than (i) above:None(iii) Changes in accounting estimates:
None(iv) Retrospective restatements:
None(2) Total number of investment units issued and outstanding(i) Total number of units issued and outstanding at the end of the fiscal period (including treasury units)
As of Feb. 28, 2018
214,000 units
As of Aug. 31, 2017
8,000 units(ii) Number of treasury units at the end of the fiscal period－ units－ units
As of Feb. 28, 2018
As of Aug. 31, 2017

* Implementation Status of Statutory Audit
At the time of this financial report, the audit procedures for the financial statements pursuant to the Financial
Instruments and Exchange Act have not been completed.
* Appropriate use of the forecast of financial results; other special items
Forecasts of financial results and other forward-looking statements contained in this material are based on
information currently available to MEL and certain assumptions deemed to be reasonable. Actual operating
performance may differ significantly from these forecasts due to a variety of factors. Furthermore, these
forecasts do not guarantee the above distribution amounts.

Note: This document has been translated from a part of the Japanese original for reference purposes only. In the event ofany discrepancy between this translated document and the Japanese original, the original shall prevail.

-3-Forecast Assumptions for the Fiscal Period Ending August 31, 2018
and the Fiscal Period Ending February 28, 2019

Item

Assumption- Fiscal period ending August 31, 2018 (4th fiscal period):
From March 1, 2018 to August 31, 2018 (184 days)
Accounting period- Fiscal period ending February 28, 2019 (5th fiscal period):
From September 1, 2018 to February 28, 2019 (181 days)

Assets undermanagement- The forecasts of management status are based on the assumption that MEL holds 8properties owned as of the date of this report. In addition, the assumption is that there
will be no changes (acquisition of new properties, disposition of properties in theportfolio, etc.) through to the end of the fiscal period ending February 28, 2019.
- The actual results may change due to the acquisition of new properties, the disposition ofexisting properties, etc.

- Operating revenues from leasing are calculated in consideration of signed leaseagreements on existing assets held, which are effective as of the date of this report, andthe trends of tenants and markets.
Operating revenues - The forecasts of operating revenues are made on the assumption that no tenants will
delay or default rental payments.
- The forecasts of operating revenues are made on the assumption that there will be noprofit or loss from sale of real estate.
- The main items of operating expenses are as follows:(Unit: millions of yen)
Fiscal period ending
Aug. 31, 2018

Fiscal period ending
Feb. 28, 2019

Total operating expense from leasing

850

862

Facility/Property management fees

58

59

Utility expenses

94

89

Repair expenses

2624

Property taxes

185

185

Depreciation

432

434

Total general and administrative expenses

Operating expenses

268

264

Asset management fee

177

167

Sponsor support fee

3535- Of operating expenses from leasing, which are the main operating expenses, the expenses
other than depreciation are calculated on the basis of historical data, and by taking into
account the factors causing fluctuation in expenses.
- Depreciation is calculated using the straight-line method and assumed to be 432 million
yen for the fiscal period ending August 31, 2018 and 434 million yen for the fiscal period
ending February 28, 2019.
- Operating income from leasing (exclusive of profit from sale of real estate) after
deduction of operating expenses from leasing (inclusive of depreciation) is assumed to be
1,321 million yen for the fiscal period ending August 31, 2018 and 1,273 million yen for
the fiscal period ending February 28, 2019.
- Fixed asset tax, city planning tax, etc. on existing assets held are assumed to be 185
million yen for the fiscal period ending August 31, 2018 and 185 million yen for the fiscal
period ending February 28, 2019.
- Repair expenses of buildings are assumed to be 26 million yen for the fiscal period ending
August 31, 2018 and 24 million yen for the fiscal period ending February 28, 2019.
However, an increase in repair expenses or additional repair expenses possibly arisingfrom unforeseeable factors may result in repair expenses for each accounting period
differing materially from the forecast amount.

-4-

Non-operating
expenses- For the fiscal period ending August 31, 2018, non-operating expenses are assumed to be58 million yen, of which interest expenses and other borrowing related expenses areexpected to be 52 million yen and expenses for amortization of deferred organization
expenses are expected to be 6 million yen.
- For the fiscal period ending February 28, 2019, non-operating expenses are assumed to
be 58 million yen, of which interest expenses and other borrowing related expenses areexpected to be 52 million yen and expenses for amortization of deferred organization
expenses are expected to be 6 million yen.

Interest-bearing
liabilities- It is assumed that total interest-bearing liabilities will be 18,901 million yen at the end of
the fiscal period ending August 31, 2018 and 18,901 million yen at the end of the fiscal
period ending February 28, 2019.
- With refund of consumption taxes for the fiscal period ended February 28, 2018
scheduled to take place during the fiscal period ending August 31, 2018, the assumption isthat the concerned refund, etc. will be used as the source of funds to repay 2,618 million
yen in loans in the fiscal period ending August 31, 2018.
- LTV ratio is expected to be around 25.1% at the end of the fiscal period ending August 31,
2018, and around 25.2% at the end of the fiscal period ending February 28, 2019.
LTV ratio is calculated using the following formula and rounded to one decimal place.
LTV = Total interest-bearing liabilities outstanding / Total assets × 100

Investment units- It is assumed that the total number of investment units issued and outstanding is 214,000
units as of the date of this report.
- It is expected that there will be no changes to the number of investment units throughissuance of new investment units until the end of the fiscal period ending February 28,
2019.
- Distributions per unit (excluding surplus cash distributions) and surplus cash
distributions per unit for the fiscal period ending August 31, 2018 and fiscal period
ending February 28, 2019 are calculated on the basis of the expected number ofinvestment units issued and outstanding at the end of the fiscal period ending August 31,
2018 and fiscal period ending February 28, 2019 of 214,000 units.

Distributions perunit (excludingsurplus cashdistributions)- Distributions per unit (excluding surplus cash distributions) are calculated on theassumption that distributions will be made in accordance with the cash distribution
policy provided in the Articles of Incorporation of MEL.
- Distributions per unit (excluding surplus cash distributions) may vary due to various
factors, including fluctuations in leasing revenues accompanying changes in assets undermanagement, changes in tenants and other events, occurrence of unexpected repairs, etc.

-5-Surplus cash
distributions perunit- Surplus cash distributions per unit are calculated in accordance with MEL’s distribution
policy described in its Articles of Incorporation and the asset management guidelines forthe asset management company. Total surplus cash distributions (continual surplus cash
distributions) for the fiscal period ending August 31, 2018 are calculated on theassumption that an amount equivalent to 30% of depreciation during the term will be
distributed and are assumed to be 129 million yen. Total surplus cash distributions (thetotal of continual surplus cash distributions and temporary surplus cash distributions) for
the fiscal period ending February 28, 2019 are assumed to be 173 million yen. For thefiscal period ending February 28, 2019, the amount of distributions per unit (excluding
surplus cash distributions) is expected to temporarily decrease due to a temporary
decline in operating revenues from leasing. It is therefore assumed that an amountequivalent to 40% of depreciation will be distributed for the purpose of equalizing theamount of distributions per unit (including surplus cash distributions). All of them arerefunds of contributions that correspond to “a capital distribution with decrease ofinvestment capital, etc.” under taxation law. There will be no distribution from allowancefor temporary difference adjustment.
- Depreciation may differ from the amount assumed at present, depending on changes inassets under management, incidental expenses, etc. which are included in the cost ofacquisition, the amount of capital expenditure, the method of proportional division of thecost of acquisition into each asset, and useful life applied to each asset. Therefore, total
surplus cash distributions which are calculated on the basis of depreciation may alsochange due to various factors including those mentioned above.
- There may be cases where MEL implements distribution of cash in surplus of the
distributable amount to investors on the basis of financial statements related to cash
distribution approved under the Investment Trust Act if the board of directors of MEL
deems such distribution to be appropriate (1) in light of the economic environment, realestate market, lease market or other trends; (2) when the amount of income fails to meet
the amount equivalent to 90% of distributable income; (3) when the distribution amountfails to meet the requirements for the Special Provisions for Taxation on Investment
Corporations; or (4) in other ways to maximize the interest of investors. When MEL
implements distribution of cash in surplus of the distributable amount, it limits theamount to the total of the amount of income for the operating period in question and theamount stipulated under laws and ordinances (inclusive of the rules of the Investment
Trusts Association, Japan).
- MEL adopts a policy to continually implement surplus cash distributions every fiscal
period in principle, with the amount equivalent to 30% of depreciation as the target
amount (continual surplus cash distributions).
In addition to the continual surplus cash distributions, MEL may also temporarily
implement surplus cash distributions for the purpose of equalizing the amount ofdistribution per unit if the amount of distribution per unit is expected to temporarily
decrease by a certain level due to issuance of new investment units or other procurementof funds, large-scale repairs, etc. However, there may be cases where MEL does not
implement any distribution of cash in surplus of the distributable amount if MEL deems
such distribution to be inappropriate in light of the economic environment, real estatemarket, lease market or other trends, status of assets held, financial status, etc.
- Surplus cash distributions per unit may decrease in case of emergency capital
expenditure due to building damage, etc. arising from unforeseeable factors. Furthermore,from the perspective of continuing stable financial management, surplus cash
distributions will not be executed in cases where the appraisal LTV exceeds 60% in theevent that the above distribution of cash is executed.
(Note) Appraisal LTV (%) = a/b (%)
a = Total interest bearing liabilities on the balance sheet for the fiscal period related to the operating period inquestion (exclusive of consumption tax loans) + Reversal from security deposit reserves (exclusive of cases
where security deposits are refunded according to leasing agreements with tenants)
b = Total assets on the balance sheet for the fiscal period related to the operating period in question – Bookvalue after depreciation of real estate held in the fiscal period in question + Total appraisal value of realestate held in the fiscal period in question – Total cash distributions to be paid in the next operating period– Total surplus cash distributions to be paid in the next operating period-6-Other- It is assumed that any revision that will have an impact on the forecast information above
will be made with regard to laws and regulations, tax systems, accounting standards,
listing rules of the Tokyo Stock Exchange, rules of the Investment Trusts Association,Japan, etc.
- It is assumed that no unexpected material change will arise in overall economic trends
and real estate market conditions.

-7-