COMFORIA RESIDENTIAL REIT, INC
Semi-Annual Reportfor the 16th Fiscal Period
From February 1, 2018 to July 31, 2018

For a Superior Level of Living Comfort
COMFORIA

1-1 Minami-Aoyama 1-chome, Minato-ku, Tokyo https://www.comforia-reit.co.jp/en/

I

Overview of the Investment Corporation

Greetings
We are pleased to inform you that Comforia Residential REIT, Inc (the “Investment
Corporation”) successfully closed all accounts for the 16th Fiscal Period (from February 1,
2018 to July 31, 2018). We would like to thank all of our unitholders and stakeholders fortheir continued support and cooperation.
We extend our deepest sympathies to the victims of the heavy rain, typhoons, andearthquakes that occurred over the summer and early autumn, and hope for a rapid
recovery of the areas affected.
We hereby report on the asset management overview and results for the 16th Fiscal Period.
During the 16th Fiscal Period, we acquired four properties including COMFORIASETAGAYAKAMIUMA in February 2018 through a public offering for the fifth consecutive year
since listing, as well as borrowings. Subsequently, we acquired three properties, including
COMFORIA SHINJUKU, and sold one property (COMFORIA YOKOHAMAKANNAI) in March2018. Furthermore, we acquired COLLEGE SQUARE HACHIMANYAMA in May 2018 and sold
COMFORIA KOMAE in June 2018 in an effort to improve the quality of our portfolio.

For a Superior Level of Living Comfort
COMFORIA is the name we have given to the urban rental residences producedby the Tokyu Land Corporation. The word COMFORIA is a compoundthat we coined from “comfort,” and “ia,” a Latin suffix meaning “place.”
The idea that residences are not just containers has given
birth to our COMFORIA series of rental residences made specificallyfor people who wish to live freely and affluently in urban communities.
We invest in and manage the urban exclusive rental residence COMFORIA series,
which Tokyu Land Corporation has produced, to maximize our unitholders’ value.

Comforia Residential REIT, Inc
Takehiro Izawa
Executive Director (center)

Yoshihiro Kataoka

Supervisory Director (left)

As a result, our portfolio as of the end of the 16th Fiscal Period stood at 117 properties, withKoji Yamamotoa total acquisition price of ¥202.1 billion, achieving our target asset size of ¥200 billion. The
Supervisory Director (right)
average occupancy rate for the 16th Fiscal Period remained high at 96.4%. The Investment
Corporation had ¥8,147 million in operating revenue, ¥3,703 million in operating profit, and ¥3,191 million in profit, all of which exceeded
our forecasts, resulting in a distribution per unit (DPU) of ¥4,985.
Furthermore, after the end of the 16th Fiscal Period, we also acquired GRANCREER CENTER-MINAMI, the first home for the elderly tobe acquired by the Investment Corporation, in September 2018 with borrowings. The result is an asset size of 118 properties with a
total acquisition price of ¥206.3 billion (as of September 30, 2018). We intend to continue to make selective investments in high-quality
properties mainly in Tokyo 23 wards.
Under our basic policies of “investments in residential properties with stable earnings and high growth potential” and “utilization of
the Tokyu Fudosan Holdings Group,” we are carrying out investment in and management of rental residences, mainly in the Tokyo
metropolitan area, targeting singles and small families, based on the concept and know-how of the urban rental residence Comforia
series, which the Tokyu Land Corporation has produced. In the next fiscal period onward, we will continue to aim to achieve stableearnings and ensure the steady growth of our managed assets based on medium- and long-term perspectives to maximize unitholders’value. Your continued support and cooperation are highly appreciated.

Financial Highlights
Operating revenue¥8,147 million
Operating profit¥3,703 million
Profit¥3,191 million
Distribution per unit (DPU)¥4,985
Total loan to value (LTV)
51.0 %

Number of properties
Acquisition priceAppraisal value
Occupancy rate at the
16th Fiscal Period-end
Average occupancy rate

117 properties¥202.1 billion¥236.8 billion
96.6 %
96.4 %

Contents
I. Overview of the Investment Corporation
Greetings/Financial Highlights....................................................................1

II. Asset Management Report ......................................................... 19
III. Financial Section

Interview with Executive Director
Toward an Asset Size of ¥300 Billion........................................................2

Balance Sheets.......................................................................................... 48

Properties Acquired in the 16th Fiscal Period....................................6

Statements of Changes in Unitholders’ Equity..................... 51

Selective Investments through Diversified
Property Acquisition Channels....................................................................8
Portfolio Map....................................................................................................... 10Internal Growth Strategy.............................................................................. 12
Financial Strategy.............................................................................................. 14
Sustainability Initiatives................................................................................. 16

Statements of Income ........................................................................ 50
Statements of Cash Distributions................................................. 52
Statements of Cash Flows.................................................................. 53
Notes............................................................................................................... 54
Supplementary Schedules................................................................ 64
Independent Auditor’s Report........................................................ 71

Basic Policies........................................................................................................ 17
Overview of the Investment Corporation andAsset Management Company.................................................................. 18

1

Interview with
Executive Director

Toward an Asset Size of ¥300 Billion
did you do for managing the
Q. Whatproperties?

The Investment Corporation was listed in February 2013 with anasset size of ¥71.2 billion, which has steadily grown through selective
investments in high-quality properties mainly in Tokyo 23 wards [wherestable earnings and high growth potential can be expected, based on apolicy of aiming for continual growth while pursuing the improvementof unitholders’ value].
As a result, in March 2018 we were able to achieve an asset size of¥200 billion, which had been our target since we were first listed. Weinterviewed Takehiro Izawa, Executive Director, about the Investment
Corporation’s history and growth strategy.

Takehiro Izawa
Executive Director
Comforia Residential REIT, Inc

Q.

First, please give us yourreflections on the previous goalof ¥200 billion in assets.

I was appointed general manager of the AssetManagement Department of TLC Comforia
Investment Management Inc. (now TLC REITManagement Inc.) in September 2013, shortly after
the company was listed. Since that time I have been
primarily engaged in property acquisitions andproperty management. When performing thesefunctions, I have paid particular attention to thequality of properties, the Investment Corporation’s
most distinctive characteristic.
With “in Tokyo 23 wards” and “near stations” as
the focus, the Investment Corporation continued toacquire rental properties developed by sponsors andto use its asset management company’s own property
acquisition channels to selectively invest in highquality properties. Because residences require smaller
investments (per property) than offices, commercial
properties, logistics facilities, and similar, even more
properties must be acquired to expand an asset
portfolio, requiring a commensurate amount of work in
the process. However, the Investment Corporation wasable to steadily expand asset holdings by consistently
scrutinizing the properties under consideration. As aresult, assets grew to ¥202.1 billion at the end of the
16th Fiscal Period. With properties within Tokyo 23
wards accounting for more than 90% of properties held,
the Investment Corporation has been able to build anexcellent portfolio of properties that are less than a fiveminute walk on average to the nearest station.

◆	 COMFORIA WELBOXAn Internet-based service offering various
discounts (approximately 4,000 menu items)◆ A Portfolio that Focuses on
Tokyo 23 Wards × Properties near Stations◆ Comparison of Indicators (Listing FP－Latest FP)

Asset size

ListedLatestEnded July 2013

Ended July 2018¥71.2 billion¥202.1 billion<Areas of investment (rental residences)>

Distribution
per unit (DPU)¥4,051¥4,985(+23.1%)Other
major cities
7.5%

Net asset value(NAV) per unit

¥150 thousand¥228 thousand(+51.6%)

Credit rating (JCR)

A+ (Stable)

AA– (Stable)Tokyo
metropolitan
area
1.6%

Tokyo 23 wards
Sub-central
Tokyo
47.5%

90.9%

Central
Tokyo
43.4%

<Minutes to nearest station (on foot) (rental residences)>Over
10 mins
2.9%
Between5 and 10 mins
34.4%

Averageminutes on foot

4.8 mins

Under
5 mins62.7%(As of July 31, 2018)
2

The Investment Corporation’s property management
continued to focus on the COMFORIA brand, abrand name for rental condominiums. In the belief
that branding is a key element in ensuring market
competitiveness, in 2015 the Investment Corporation
developed the brand concept of “For a Superior
Level of Living Comfort” in collaboration with thesponsor, TLC. By rebuilding the brand and improving
various service menu options, such as providing an
Internet-based discount service for tenants known
as COMFORIA WELBOX, we sought to strengthenmarket competitiveness by boosting brand value andto extend tenancy periods (and so reduce vacancy
periods) by improving tenant satisfaction. As a result,the Investment Corporation has consistently been able
to maintain an occupancy rate for properties of 95%
or higher.

over five years to ¥4,985 for the current fiscal period (thefiscal period ended July 2018). In addition, the NAV (netasset value) per unit, an important measure of investor
value, has also improved by about 52% from the fiscal
period in which the Investment Corporation was listed,and I believe that these management successes arereflected in investor value.
The Investment Corporation’s external rating of
A+ at the time it was listed was upgraded to AA- in
March 2016, showing that our initiatives were regardedfavorably by outside institutions.
Through these approaches, the Investment
Corporation was able to reach the target—¥200 billion
in assets within six to seven years of listing—a year
earlier than initially envisioned. When increasing assets,
the Investment Corporation has raised capital throughpublic offerings five times in five consecutive years
since being listed, becoming the only residence-related
investment corporation to increase capital throughannual public offerings. The continued support ofinvestors is very much appreciated.

(Note 1) Since a four-for-one split of investment units was carried out effective
August 1, 2014, the distribution per unit (DPU) figure for the fiscal period
when the Investment Corporation was listed is divided by four androunded off to the nearest whole number.

about improving investor
Q. Whatvalue?
The Investment Corporation has been able, since listing,to operate with a focus on the quality of properties,
but of course has also sought to ensure sound growthby paying attention to improving investor value for
distribution levels and other items. The distribution perunit (DPU) was set at ¥4,051(Note 1) when the Investment
Corporation was first listed (the fiscal period ended July2013), and this was increased by approximately 23%3Interview with
Executive Director
describe your growth
Q. Pleasetargets for the future.
Upon reaching ¥200 billion in assets in March 2018, theInvestment Corporation announced new targets of ¥300
billion in assets and a distribution per unit (DPU) (ongoing basis) of ¥5,000 as growth targets in the materials
used for the 15th Fiscal Period investor presentation andposted on our website. The Investment Corporation will
be aiming for steady growth, while continuing to pay
close attention to the quality of properties.
Given recent real estate market conditions and theincreasingly fierce competition to acquire outstanding
properties, such as rental residences within Tokyo
23 wards, the Investment Corporation intends topursue consistent growth in assets without setting
deadlines for meeting asset targets in order to avoid
feeling compelled to buy at high prices. With respect
to distribution per unit (DPU) targets, the Investment
Corporation will strive to raise the current DPU (ongoing basis) of about ¥4,700 to ¥5,000 (after excluding
factors prompting one-off dividend increases (Note 2) andduly considering the impact of the consumption tax
hike scheduled for October 2019). A deadline has yet
been set for achieving this DPU target (on-going basis),but the intent is to achieve it as soon as possible.
(Note 2) Factors that lead to one-off increases in distribution amounts,
such as the capitalization of gains from property sales and of
fixed asset taxes for the year of acquisition.

Q.

You have stipulated an asset sizeof ¥300 billion and a DPU(on-going basis) of ¥5,000 as
growth targets, but how will you
go about achieving these?

To achieve these new targets, the Investment
Corporation will be supplementing existing initiatives
with new approaches.
First, with respect to the asset size target, theInvestment Corporation will continue increasing assets
primarily by acquiring rental residences within Tokyo 23
wards and by maintaining a ratio of rental residences
within the 23 wards of around 90% (with a minimumof 85%) of all rental residence holdings. In addition, theInvestment Corporation hopes to invest in operational
rental residences where a reliable cash flow can be
expected through long-term fixed contracts for student
dormitories, senior residences, and so on.
In September 2018, the Investment Corporationacquired the first housing for seniors (GRANCREER
CENTER-MINAMI). This property was developed andowned by the sponsor, and the steady cash flow
anticipated over the medium to long term will help
stabilize distribution amount. As competition intensifies
for acquiring rental properties in Tokyo 23 wards, theInvestment Corporation plans to consider including
other outstanding properties in the portfolio as a newmeans of asset growth.

Asset size target: ¥300 billion
DPU target (on-going basis): ¥5,000

Response from Our Asset Manager

4Q

Why do distributions of residential REITs decrease when
the consumption tax is raised?

A

While housing rent, which accounts for most of the Investment Corporation’s
income, is tax free, except in certain cases, expenses such as property
management entrustment costs and repair costs are taxed. This means that
expenses increase when the consumption tax is raised, resulting in a decline
in distributions. Assuming that the consumption tax will be raised to 10%,
the Investment Corporation will monitor distribution per unit (DPU) on an
ongoing basis and aim to improve this level.

Saeka Kinoshita
Assistant Manager
Comforia Management Division
Asset Management Department
TLC REIT Management Inc.
Hobby: Zumba

122 GRANCREER CENTER-MINAMI

Tokyo metropolitan area

distribution per unit (DPU) while keeping a close eye on
earnings stability.

you have any other plans at
Q. Do
the moment?

Address

40-3 Chigasaki Chuo, Tsuzuki-ku, Yokohama-shi, Kanagawa

Nearest station/
Distance (on foot)3-minute walk from Center-Minami Station on the
Yokohama Municipal Subway Blue Line and 1 other line

Ownership

OwnershipCompletion dateAugust 2009

Facility type

Residential-type fee-based home for the elderly

Rentable units

124 units

Acquisition date

September 25, 2018

Acquisition price¥4,150 million

Appraisal NOI yield

4.8%

Next, with regard to the distribution per unit (DPU)
target (on-going basis), the Investment Corporation islooking to improve earnings by continuing to acquire
new properties while boosting earnings from properties
through higher rent. Rents have been increased recently,
particularly in properties located in Tokyo 23 wards, with an
all-time high rent increase of 4.6% on tenant turnoverachieved during this period (16th Fiscal Period). With rising
wages for younger workers in particular and rebounding
corporate performance driving demand for company
housing, the uptrend in rents seems likely to continue forthe time being, especially for properties in Tokyo.
Revenues are therefore expected to improve but,in light of higher maintenance costs as properties age,the Investment Corporation is considering replacing
assets in the portfolio. By selling off properties outsideof Tokyo 23 wards and older properties and obtaining
relatively new properties within Tokyo, replacement
would improve the quality of properties held, in
addition to which any profits made from property sales
could be allocated to internal reserves to deal with
future cost increases. During the current fiscal period,
COMFORIA SHINJUKU and three other properties
were acquired while COMFORIA YOKOHAMAKANNAIand another property were sold off between Marchand June 2018, with some of the gains from thesesales (¥285 million) allocated to internal reserves. The
Investment Corporation is seeking to steadily increase

The Investment Corporation has been able to enjoy
steady growth with the support of investors, and I
would like, as always, to express my gratitude.
Thanks to their support, the Investment
Corporation has been able to consistently reach asset
size targets since being listed, and as of June 2018 has
been included in the FTSE EPRA/NAREIT Global Real
Estate Index Series, a major benchmark for international
real estate investment, bringing us attention fromoverseas investors as well. The Investment Corporationis committed to achieving constant growth whilebuilding a good-quality portfolio so that we continue
enjoying the high regard of a variety of investors.
Thank you very much.

5

Properties Acquired in the 16th Fiscal Period
During the 16th Fiscal Period, the Investment Corporation acquired four properties at the time of the public offering, as well as acquiring
three properties and selling one property in March, and acquiring and selling one property each during May and June.
These transactions have led to an improvement in the quality of the portfolio, including a reduction in the average distance to the nearest
station and an increase in the ratio of those located in Tokyo 23 wards.

120 COMFORIA SHINJUKU

5-8-20 Shinjuku, Shinjuku-ku, Tokyo

111 properties /¥ 188.5 billion

117 properties / ¥ 202.1 billion

Nearest station/
Distance(on foot)

5-minute walk from Shinjuku-sanchome
Station on the Tokyo Metro
Marunouchi Line and Fukutoshin Line,and Toei Shinjuku Line

Sponsordeveloped

Address
Nearest station/
Distance (on foot)Sub-central Tokyo
2-6-8 Ryusen, Taito-ku, Tokyo

Sponsor-developed
properties

Warehousing

115 COMFORIA IKEJIRI
Warehousing

6-minute walk from Iriya Station on
the Tokyo Metro Hibiya Line

Sub-central Tokyo
Address

2-31-18 Ikejiri, Setagaya-ku, Tokyo

Nearest station/
Distance (on foot)2-minute walk from Ikejiri-ohashi Stationon the Tokyu Den-en-toshi Line

Ownership

Ownership

Ownership

OwnershipCompletion dateJan. 2016

Completion dateMar. 2008

Rentable units

88 units

Rentable units

36 units

Acquisition dateFeb. 2, 2018

Acquisition dateFeb. 2, 2018

Acquisition price¥2,173 million

Acquisition price¥1,313 million

Appraisal NOI yield

4.6%(as of Oct. 31, 2017)

Appraisal NOI yield

4.5%(as of Oct. 31, 2017)

116 COMFORIA SETAGAYAKAMIUMA

Sub-central Tokyo

Address

3-6-11 Kamiuma, Setagaya-ku, Tokyo

Nearest station/
Distance (on foot)4-minute walk from Komazawa-daigaku
Station on the Tokyu Den-en-toshi Line

Ownership

OwnershipCompletion dateFeb. 2017

117 COMFORIA KITAHAMA
Sponsordeveloped

2-1-14 Imabashi, Chuo-ku, Osaka-shi,
Osaka

Nearest station/
Distance(on foot)

2-minute walk from Kitahama Stationon the Osaka Municipal Subway
Sakaisuji Line and 1 other line
6-minute walk from Yodoyabashi
Station on the Osaka Municipal
Subway Midosuji Line and 1 other line

Ownership

OwnershipCompletion dateFeb. 2016

Rentable units

84 units¥2,622 million

Acquisition dateFeb. 2, 20184.5%
(as of Oct. 31, 2017)

Acquisition price¥1,719 million

Appraisal NOI yield

4.8% (as of Oct. 31, 2017)

Rentable units

68 units

Acquisition dateFeb. 2, 2018

Acquisition priceAppraisal NOI yield

Sub-central Tokyo

Rentable units

65 units
Mar. 30, 2018

Acquisition price¥2,150 million

Appraisal NOI yield

4.4% (as of Feb. 28, 2018)

Sub-central Tokyo

Address

26-11 Iwabuchimachi, Kita-ku, Tokyo

Address

1-5-15 Kamezawa, Sumida-ku, Tokyo

Nearest station/
Distance (on foot)4-minute walk from Akabane-iwabuchi
Station on the Tokyo Metro Namboku Line

Nearest station/
Distance (on foot)2-minute walk from Ryogoku Stationon the Toei Oedo Line

Ownership

Ownership (sectional ownership interest 100%)

Mar. 2015

Rentable units

46 units

Acquisition date

May 25, 2018

Acquisition price¥880 million

Appraisal NOI yield

4.4%

End of 15th FP(A)

Completion dateMar. 1990

Rentable units

24 units

Acquisitions

End of 16th FP
(B)

Sales

Difference
(B−A)

8

2

117

6

188,536

15,017

1,371

202,182

13,646

90.5%

88.6%

—

91.0%

+0.5 ppt

4.9 minutes

3.9 minutes

5.6 minutes

4.8 minutes–0.1 minutes

Asset size
(millions of yen)
Ratio of Tokyo
23 wards

Investment Ratio by Area

Central Tokyo
Sub-central Tokyo

4.5% (as of Feb. 28, 2018)

Tokyo metropolitan area

111

Tokyo metropolitan area

Appraisal NOI yield

28 COMFORIA KOMAE

Sub-central Tokyo¥422 million (as of Jan. 31, 2018)

Ownership

57 units

4.7% (as of Feb. 28, 2018)

60 units

Book value

OwnershipCompletion date

Rentable units

Appraisal NOI yield

Rentable units¥605 million

84 units¥1,660 million

Jul. 2009

Sale price

Rentable units

Mar. 30, 2018

Completion date

5-minute walk from Hachimanyama
Station on Keio LineJul. 2013

Acquisition date¥929 million (as of Jan. 31, 2018)

Nearest station/
Distance(on foot)

Ownership

Acquisition priceBook value

3-9-5 Iwado Kita, Komae-shi, Tokyo

Ownership¥2,500 million¥1,200 million

Address

Completion dateMar. 30, 2018

Sale price1-15-2 Kamitakaido, Suginami-ku,
Tokyo

Mar. 2003

Acquisition date

2-8-15 Okinacho, Naka-ku, Yokohama-shi, Kanagawa

Address

Completion date

Acquisition price

Address‌Improvement in Portfolio Quality through Property Acquisitions and Sales

Avg. distance

119 COMFORIA RYOGOKU TROIS

Mar. 2018

Properties‌Properties Acquired in the 16th Fiscal Period
118 COMFORIA AKABANEIWABUCHI

Ownership

121 COLLEGE SQUARE HACHIMANYAMA

Other major cities

Address

OwnershipCompletion date

Acquisition date

Warehousing
properties by sponsors

42 COMFORIA YOKOHAMAKANNAI Tokyo metropolitan area

Central Tokyo

Address

114 COMFORIA UENOIRIYA

6

Properties soldEnd of 16th FP(Acquired on February 2, 2018)

Sponsordeveloped

Properties acquired

End of 15th FP‌Properties Acquired through Public Offering

SponsordevelopedA‌ sset Replacement

Other major cities(Ratio of Tokyo 23 wards)

End of 15th FP

End of 16th FP(End of Jan. 2018)(End of Jul. 2018)

44.9%
45.6%
2.5%
7.0%
90.5%

42.9%
48.1%
1.6%
7.4%
91.0%

Difference–2.0 ppt+2.5 ppt–0.9 ppt+0.4 ppt+0.5 ppt
7

Selective Investments through Diversified Property Acquisition Channels
During the 16th Fiscal Period, the Investment Corporation acquired four properties centering on sponsor-developed properties withfunds procured through a public offering conducted in February 2018 for the fifth consecutive year since listing, as well as borrowings.
The Investment Corporation also acquired four properties located in Tokyo 23 wards and sold two properties located in other areas inTokyo between March and June, resulting in an improvement in the portfolio quality, and achieving the asset size target of ¥200 billion.
The Investment Corporation will keep promoting external growth by continuing to invest selectively in high-quality properties mainly inTokyo 23 wards, focusing on the collaboration with our sponsor group, as well as original sourcing by TLC REIT Management Inc., while
seeking expansion of the asset size and stable distribution levels.

Selective Investments Mainly in Tokyo 23 Wards (As of September 30, 2018)
Historical Asset Size
(Billions of yen)200

5Over around years
since listing,achieved approximately

Acquired
COMFORIA KUDAN and
24 other properties

71.2
Tokyo
23 wards
96.3%

Tokyo
23 wards
92.5%

74.5
Tokyo
23 wards
93.3%

188.5

Tokyo
23 wards
90.5%

Tokyo
23 wards
90.5%

206.3

168.0

122.8

Tokyo
23 wards
92.9%

187.4

Acquired
GRANCREER
CENTER-MINAMI

146.7

146.5

100

71.2

202.1

164.4

116.2

Tokyo
23 wards
96.3%

Acquired
Acquired
COMFORIACOMFORIA SHINJUKU ICHIGAYAYAKUOJI andEASTSIDE TOWER and two other properties
three other properties

Acquired
COMFORIA
Acquired
AKIHABARA EAST andeight other properties COMFORIA SHIBAURA

Acquired
COMFORIA KOMABA andone other property

2.8-fold growth150

0Acquired
COMFORIA AZABUEAST andone other property,
sold two properties

Acquired
COMFORIA
KANDAJINBOCHO and11 other properties

Acquired
COMFORIA
SETAGAYAKAMIUMA
and seven other properties,
sold two properties

Future Strategy
Aim for an asset
size of ¥300 billion
while maintaining
a portfolio withproperties mainlyin the Tokyo 23
wards

Tokyo
23 wards
94.0%

Tokyo
23 wards
93.6%

Tokyo
23 wards
94.3%

Tokyo
23 wards
92.8%

Tokyo
23 wards
91.0%

Listed(Feb. 6, 2013)“End of 6th
Fiscal Period”
Ended Jul. 2013“End of 7th
Fiscal Period”
Ended Jan. 2014“End of 8th
Fiscal Period”
Ended Jul. 2014“End of 9th
Fiscal Period”
Ended Jan. 2015

“End of 10th
Fiscal Period”
Ended Jul. 2015

“End of 11th
Fiscal Period”
Ended Jan. 2016“End of 12th
Fiscal Period”
Ended Jul. 2016“End of 13th
Fiscal Period”
Ended Jan. 2017“End of 14th
Fiscal Period”
Ended Jul. 2017“End of 15th
Fiscal Period”
Ended Jan. 2018“End of 16th
Fiscal Period”
Ended Jul. 2018

Distribution
per unit (DPU)(Note)ー¥4,051¥4,203¥4,268¥4,296¥4,403¥4,339¥4,487¥4,549¥4,681¥4,788¥4,985

Aim to improve DPU(ongoing basis)

Occupancy rate
at end of period

ー

95.9%

96.2%

94.8%

95.2%

95.5%

96.2%

96.3%

96.5%

96.1%

96.7%

96.6%

Consistently stable
occupancy rate

Future strategy

Sep. 2018

Note: S ince a four-for-one split of investment units was carried out effective August 1, 2014, the figures for DPU prior to the split are divided by four and rounded off to the nearest whole number.

D‌ iversified Property Acquisition Channels Centering on Sponsor Groups
The Investment Corporation promotes steady growth of asset size centered on theacquisition of assets from sponsor groups, in particular Tokyu Land Corporation. In addition,
we strive to reinforce our property acquisition channels through the Asset Management
Company’s original information routes.

17th FP

16th FP
Acquisition fromsponsor group8(up to September 30, 2018)

Acquisition through original
route of the AssetManagement Company

Acquisition fromsponsor group

4 properties

4 properties

1 property¥ 7,827 million¥ 7,190 million¥ 4,150 millionP‌ roperty Development by Tokyu Land Corporation (As of September 14, 2018)

Ratio of Acquired
Assets by Seller

There is a pipeline of 21 properties containing 2,136 units located primarily within Tokyo 23 wards.
Suita-shi(As of September 30, 2018)
Itabashi-ku

Sponsor
41.6%

Other

31.0%
Acquisition fromsponsor group

69.0%

Kita-kuToshima-ku

Tokyo 23 wards and the Tokyo metropolitan area
Arakawa-ku

Sumida-ku
Nakano-ku
Bunkyo-ku Taito-ku
Shinjuku-ku
Suginami-ku
Chiyoda-ku
Chuo-ku
Shibuya-ku
Koto-ku
Setagaya-ku
Minato-ku
Meguro-ku
Shinagawa-ku

17 properties 1,677 units

Higashiyodogawa-ku
Kita-kuChuo-ku
Kyoto

Nishi-ku

Kansai area

4 properties

459 units

Shin-Kobe

Shin-Osaka

Ota-kuOther sponsors
27.4%

Properties developed by TLC● Rental residence● Operational rental residence (no specific plans for acquisition by the Investment Corporation)

9

Portfolio Map (As of September 30, 2018)
The Investment Corporation manages assets with superb accessibility located mainlyin the Tokyo 23 wards.

COLLEGE SQUARE

121 HACHIMANYAMA

COMFORIACOMFORIA

120 SHINJUKU

118 AKABANEIWABUCHI

Central Tokyo 44 properties

1 COMFORIA NIHONBASHI NINGYOCHO 26 COMFORIA HARAJYUKU
2 COMFORIA WASEDA
30 COMFORIA MITA NORTH
3 COMFORIA SHIMOOCHIAI
31 COMFORIA SHIBAURA BOWHOUSE
4 COMFORIA HIGASHINAKANO
48 COMFORIA SHIROKANETAKANAWA
14 COMFORIA GINZA EAST
49 COMFORIA NIHONBASHI NINGYOCHO EAST
15 COMFORIA AZABUDAI
50 COMFORIA ATAGO
16 COMFORIA SHIBAKOEN
56 COMFORIA KUDAN
17 COMFORIA NISHIAZABU
57 COMFORIA NIHONBASHI NINGYOCHO NORTH
18 COMFORIA MINAMIAOYAMA
58 COMFORIA SHINKAWA
19 COMFORIA MINAMIAOYAMA DEUX 59 COMFORIA AKASAKA
20 COMFORIA NISHIWASEDA
60 COMFORIA MITA EAST

61 COMFORIA SHIBAURA CANAL
69 COMFORIA KITASANDO
70 COMFORIA YOYOGIUEHARA
71 COMFORIA SASAZUKA
72 COMFORIA SHINJUKUGYOEN II
73 COMFORIA ICHIGAYAYANAGICHO
74 COMFORIA KAGURAZAKA
80 COMFORIA NIBANCHO
81 COMFORIA NISHISHINJUKU
83 COMFORIA KANDAJINBOCHO
84 COMFORIA NIHONBASHI

85 COMFORIA TAMACHI
86 COMFORIA AZABUJUBAN
92 COMFORIA SHINJUKUGYOEN I
93 COMFORIA KAGURAZAKA DEUX
96 COMFORIA AZABU EAST
98 COMFORIA SHINJUKU EASTSIDE TOWER
103 COMFORIA ICHIGAYAYAKUOJI
104 COMFORIA AKIHABARA EAST
105 COMFORIA MITA TROIS
113 COMFORIA SHIBAURA
120 COMFORIA SHINJUKU

47

Acquired in the
16th Fiscal Period

75 COMFORIA HIGASHIIKEBUKURO EAST 119 COMFORIA RYOGOKU TROIS
76 COMFORIA HIGASHIIKEBUKURO
121 COLLEGE SQUARE HACHIMANYAMA
82 COMFORIA KOMABA
87 COMFORIA KINSHICHO
88 COMFORIA MINAMISUNAMACHI
89 COMFORIA HIGASHISHINAGAWA
90 COMFORIA MEGUROYAKUMO
91 COMFORIA YOGA
94 COMFORIA ITABASHINAKAJUKU
95 10197 COMFORIA SHINAGAWA EAST

Ota-ku122 GRANCREER
CENTER-MINAMI

Katsushika-ku

44

68

Chiba

Edogawa-ku

Nishifunabashi

112

46

COMFORIA

119 RYOGOKU TROIS

Acquired in the
16th Fiscal Period

100
COMFORIA

107

116 SETAGAYAKAMIUMA

122 GRANCREER CENTER-MINAMI

54 COMFORIA SHIN-OSAKA
111 COMFORIA AWAZA
78 COMFORIA SHINSAKAE
117 COMFORIA KITAHAMA
79 COMFORIA KITAHORIE
95 COMFORIA KITASANJO
101 COMFORIA SAPPORO SHOKUBUTSUEN
102 COMFORIA OGIMACHI
109 COMFORIA SHINSAIBASHI EAST
110 COMFORIA KYOMACHIBORI

Acquired in the
16th Fiscal Period

115 COMFORIA IKEJIRI

10

Acquired in the
16th Fiscal Period
Acquired in the
17th Fiscal Period

TotalArakawa-ku

45
27 Toshima-ku
64
41
Ikebukuro
75 22 106
Taito-ku
Nakano-ku
76
114
Sumida-ku
3Bunkyo-ku
Ueno
21 5
55
8
20
6
4
62
33
40
63
34
Shinjuku-ku 232
74
51 29119 87
98
73 93
81
83 57104 43 52
56
84
120 72 103
Suginami-ku
Shinjuku 69
49
65 35
80 Chiyoda-ku
92
99
1
Tokyo
12
Shibuya-ku
36
88
121
Minato-ku
58
108
71
59
66 Koto-ku
26 18
14
9
19 15 50
70
Chuo-ku
Shibuya
17 96
16
53
30
82
60
86
Setagaya-ku
115 23
105
61
48
38
113
116
67
85 31
13
91
39
Shinagawa
37
97
Meguro-ku
89
Shinagawa-ku
90

122

77 COMFORIA SHINKOYASU
112 COMFORIA GYOTOKU

Kita-ku

7

Other major cities 10 properties

10

Tokyo

99 COMFORIA OJIMA
100 COMFORIA OMORI TROIS
106 COMFORIA BUNKYOHAKUSAN
107 COMFORIA KAMATA
108 COLLEGE COURT HACHIMANYAMA
114 COMFORIA UENOIRIYA
115 COMFORIA IKEJIRI
116 COMFORIA SETAGAYAKAMIUMA
118 COMFORIA AKABANEIWABUCHITokyo metropolitan area 5 properties

46 COMFORIA ICHIKAWAMYODEN
47 COMFORIA YATSUKA

Kichijoji

Adachi-ku

Akabane94
11

Nerima-ku

Acquired in the
16th Fiscal Period

118

Itabashi-ku

Sub-central Tokyo 59 properties

5 COMFORIA BUNKYOKASUGA
37 COMFORIA HIMONYACOMFORIAASAKUSAMATSUGAYA
6
38 COMFORIA MISYUKUCOMFORIANISHIOI
7
39 COMFORIA GAKUGEIDAIGAKUCOMFORIA
NAKANO
840 COMFORIA HIGASHINAKANO DEUXCOMFORIA
SHIMOKITAZAWA
941 COMFORIA HIGASHIIKEBUKURO WEST
COMFORIANISHIKAMATA
1043 COMFORIA RYOGOKU DEUXCOMFORIAOYAMA
1144 COMFORIA OMORI DEUXCOMFORIA
KIYOSUMISHIRAKAWA
SOUTH
1245 COMFORIA MACHIYACOMFORIA
KOMAZAWA13
51 COMFORIA ASAKUSABASHI
21 COMFORIA KOISHIKAWA
52 COMFORIA RYOGOKU SOUTH
22 COMFORIA SENGOKU
53 COMFORIA TOYOSU
23 COMFORIA DAIKANYAMAAOBADAI 55 COMFORIA SUMIDA-TACHIBANA
27 COMFORIA IKEBUKURO
62 COMFORIA UENOHIROKOJI
29 COMFORIA RYOGOKUISHIWARA
63 COMFORIA KASUGATOMISAKA
32 COMFORIA ASAKUSABASHI DEUX 64 COMFORIA HONKOMAGOME
33 COMFORIA OSHIAGE
65 COMFORIA MORISHITA
34 COMFORIA HONJOAZUMABASHI 66 COMFORIA KIBAKOEN
35 COMFORIA KIYOSUMISHIRAKAWA TROIS 67 COMFORIA MEGURO CHOJAMARU
36 COMFORIA MONZENNAKACHO
68 COMFORIA NISHIMAGOME

Acquired in the
16th Fiscal Period

COMFORIA

114 UENOIRIYACOMFORIA

117 KITAHAMA

Acquired in the
16th Fiscal Period78

54 79 102 109 110 111 117

Kanagawa
Yokohama

77
Acquired in the
16th Fiscal Period

Central Tokyo

Tokyo metropolitan area

Sub-central Tokyo

Other major cities

118 properties
11Internal Growth Strategy
With our portfolio strategy of investing in properties mainly in Tokyo 23 wards, steady rent increases have been realized recently, while
maintaining high occupancy rates.

The rate of rent fluctuations on tenant turnover for the 16th Fiscal Period marked a record high of + 4.6%.

C‌ ontinuous Inflow of Younger Generation and Limited Supply of Rental
Residences in Tokyo 23 Wards

Rates of Rent Fluctuation on Tenant Turnover (Total Portfolio)

While net migration of younger generation (ages 15 to under 39) to Tokyo 23 wards is far larger than that of other cities, the number of
construction starts of rental residences remains at around 50% of the peak year.
Net Migration (Ages 15 to 19)
2012(Thousand people)

2013

Rental Residence Starts in Tokyo 23 Wards
2014

2015

2016

2017

50,00040,000Osaka

Fukuoka

Sapporo2017

Nagoya-2.0

2016Tokyo 23 wards(Source) Statistics Bureau, Ministry of Internal Affairs and Communications,
Report on Internal Migration in Japan

2014

0

2012

0

2010

10,000
2008

20

2006

20,000

2004

40

+1.0%
-0.4%
8th FP-1.3%
9th FP

+3.4%

+3.7%

14th FP

15th FP

+4.6%

+1.5%

-0.5%
-0.7%
10th FP

11th FP

12th FP

13th FP

16th FP(Ended Jul. 2014) (Ended Jan. 2015) (Ended Jul. 2015) (Ended Jan. 2016) (Ended Jul. 2016) (Ended Jan. 2017) (Ended Jul. 2017) (Ended Jan. 2018) (Ended Jul. 2018)2002

30,000

2000

60

4.0

0

Remains at around 50%of the peak year

1998

80

(%)
6.0

2.0

(Units)100

I‌ mpact of Rent Fluctuations on Tenant Turnover (Total Portfolio)R‌ ent and Occupancy Rates of Flagship Property COMFORIA SHINJUKU EASTSIDE
TOWER(Source) Policy Bureau, Ministry of Land, Infrastructure, Transportation and Tourism,
Construction Statistics: Housing Starts

The occupancy rate remains at a high level and rent rate continues to rise.
Rent and Occupancy Rates‌Occupancy Rates

Rent rate (yen/tsubo) (left axis)(Yen/tsubo)

Occupancy rate (right axis) (%)

16,500100

16,00090

15,50080

The average occupancy rate for the 16th Fiscal Period remained high at 96.4%.
(%)
100

Total portfolio

96.1%

96.4%

97.1%

96.9%

96.7%

96.7%

96.4%

97.2%

96.6%

Total portfolio (year-on-year)

96.1%

95.7%

96.2%

96.6%

95

COMFORIA SHINJUKUEASTSIDE TOWER

90

Central Tokyo100

Sub-central Tokyo

Tokyo metropolitan area

15,000

Other major cities

95

90

14th FPJul.
2017

15th FP

Aug.

Sep.

Oct.

Jul.
2017

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.
2018

Feb.

Mar.

Apr.

May

Jun.

Jul.

February 2016 (Upon Acquisition)

End of 16th FP (July 2018)

Rent rate (per tsubo)¥15,780¥16,501

Average occupancy rate

94.6%

96.4%

70

16th FP

Nov.

Dec.

Jan.
2018

Feb.

Mar.

Apr.

May

Jun.

Jul.

A
‌ ctive Leasing Initiatives for Newly Acquired COMFORIA SHINJUKUThis property, acquired after completion in March 2018 and then vacant, had an occupancy rate of 91.6% four months later due to ourleasing initiatives.

I‌ mpact of Rent Increases on Tenant Turnover/Lease Renewals
The rate of rent increase in the 16th Fiscal Period remained high given tenant turnover on the back of high occupancy rates.
Tenant Turnover
(%)
100
75

Increase
Increase
27.0%
No change
13.8%

75.7%

No change

74.0%

Decrease

76.2%

50
25
0

75
50

Decrease
59.3%

6th FP(Ended Jul. 2013)(Listing)

12

(%)
100

9.7%
14.6%

9.8%
16.1%

8.9%
14.9%

14th FP

15th FP

16th FP(Ended Jul. 2017)(Ended Jan. 2018)(Ended Jul. 2018)25
0

Increase
Increase
0.0%

14.7%

No change

18.2%

Occupancy rate

(%)
100

Lease Renewals
Decrease

14.3%

74.9%

80
60

No change
98.5%
Decrease
1.5%

85.3%

81.8%

85.6%

91.6%

48.4%

40

29.1%

20

0.0%

0.0%

2.2%

0.1%

6th FP

14th FP

15th FP

16th FP(Ended Jul. 2013)(Listing)(Ended Jul. 2017)(Ended Jan. 2018)(Ended Jul. 2018)

0

COMFORIA SHINJUKU

Mar.
2018

Apr.

May

Jun.

Jul.
13

Financial Strategy
The Investment Corporation will carry out equity financing (additional issuance of investment units) and debt financing (borrowings offunds and issuance of investment corporation bonds) while paying attention to financial soundness and earnings stability. Furthermore,
the Investment Corporation will control its balance sheets by maintaining an LTV (interest-beaing debt) (%) level to secure funds.

‌Interest-Bearing Debt
LTV (loan to value ratio) (%)

Average maturity (Bar chart; years)/Weighted avg. interest rate (Line chart; %)

4.3

3.9
50.6

51.6

4.4

4.2

The Investment Corporation’s loan balances as of July 31, 2018 are as follows:

1.0%
1.3%

2.2%
2.7%
2.9%

0.5%
0.5%

0.68

■ MUFG Bank, Ltd.

0.64

33.4%

16,240
16,240■ Sumitomo Mitsui Banking Corporation

8,095■ Mizuho Trust & Banking Co., Ltd.

3,000

■ The Norinchukin Bank

2,800

■ The Bank of Fukuoka, Ltd.

2,300

■ Shinkin Central Bank

0.64

15.7%

16,775■ Development Bank of Japan Inc.

15.7%

0.68

34,480■ Mizuho Bank, Ltd.

7.8%

0.66

Loan balance(millions of yen)

Lender■ Sumitomo Mitsui Trust Bank, Limited

51.0

50.8

50.5

4.3

L‌ oan Balances

1,300■ Kiraboshi Bank, Ltd.

16.3%

1,000

■ The 77 Bank, Ltd.

500

■ The Daishi Bank, Ltd.

12th
FP

13th
FP

14th

15th

FP

16th

FP

12th

FP

13th

FP

Ratio of long-term debt to total debt (%)

14th

FP

15th

FP

16th

FP

500
103,230

Total

FP

Ratio of fixed interest debt to total debt (%)

C‌ redit Rating (As of July 31, 2018)
90.7
87.3

86.5

87.9

85.2

84.2

82.0

88.7

87.0

Rating agency

Rating category

RatingOutlookJapan Credit Rating Agency, Ltd.

Long-term issuer rating

AA-

Stable

78.8

12th
FP

13th
FP

14th

15th

FP

16th

FP

12th

FP

13th

FP

14th

FP

15th

FP

16th

FP

FP

‌Inclusion of our investment units in the FTSE EPRA/NAREIT Global Real
Estate Index Series‌Diversification of Repayment Dates
The expected repayments of debt and investment corporation bonds as of July 31, 2018 are as follows:(Millions of yen)

15,000Existing loans

12,595100

10,000

7,925

7,500
12,495

14

17th
FP

18th
FP

19th
FP

4,925
20th
FP

21st
FP

22nd
FP

4th and 5th unsecured bonds(newly issued)

Commitment line

9,650

6,000 6,560 6,900 6,520
6,270 4,650
1,000 5,860
5,000 4,950
1,000
2,860
4,900
3,150
5,520
2,000 1,500
5,000
5,000
3,410
2,000

3,700
1,350

1st–3rd unsecured bonds(existing)

8,800

5,500 3,000

5,000

0

Borrowings in the 16th period

23rd
FP

24th
FP

25th
FP

26th
FP

27th
FP

28th
FP

29th
FP

30th
FP

31st
FP

32nd
FP

33rd
FP

34th
FP

The investment units of the Investment Corporation have been incorporated into FTSE Russell’s FTSE EPRA/NAREIT
Global Real Estate Index Series (“the Index”) as of June 18, 2018.
FTSE Russell is a wholly owned subsidiary of the London Stock Exchange, developing and managing indexes(investment indexes) as a major global index provider. The Index is an international real estate investment index
developed by the FTSE Group in cooperation with the European Public Real Estate Association (EPRA) andthe National Association of Real Estate Investment Trusts (NAREIT). The Index has been adopted by numerous
institutional investors and others worldwide as a benchmark for international real estate investment.
Inclusion of the Investment Corporation in the Index will help further expand the investor base and improve
the liquidity of investment units.

46th
FP

15

Sustainability InitiativesO‌ ur Approach to Sustainability
The Investment Corporation shares the CSR vision of the Tokyu Fudosan Holdings Group, to which TLC REIT Management, the AssetManagement Company, belongs. The vision is “to work on creating solutions for social issues through our business activities and in theprocess enhance the satisfaction of stakeholders.”
We believe that our efforts to make progress concerning various problems and issues that exist in modern society, including environmental
issues such as global warming and ecosystem protection, social issues such as an aging and shrinking population, and the strengthening ofcompanies’ compliance and risk management systems will lead to greater satisfaction among our stakeholders as well as enhancement of
medium- to long-term unitholder value.

Basic Policies
We invest intensively in rental residences for singles and small families, mainly in the Tokyo metropolitan area, based on our basic policies
of “investments in residential properties with stable earnings and high growth potential” and “utilization of the Tokyu Fudosan HoldingsGroup,” with the aim of ensuring stable earnings over the medium and long term and maximizing our unitholders’ value.

‌ COMFORIA Series
We will invest in and manage rental residences, fully utilizing the concept and expertise of the urban rental residence Comforia series,
which Tokyu Land Corporation has produced.

The Investment Corporation and the Asset Management Company are engaged in a wide range of initiatives that take the environment andsociety into account by placing emphasis on the ESG (environment, society, and governance) perspective and positioning sustainability asa priority strategy.

E‌ nvironment Certification Assessments
GRESB Real Estate Assessment
GRESB is an annual benchmark survey measuring the environmental, social, and governance(ESG) performance of companies in the real estate sector, and was founded in 2009 primarily
by a group of major European pension funds. The GRESB Real Estate Assessment does
not assess individual properties, but instead comprehensively evaluates the sustainability
initiatives of real estate companies and REITs.

For a Superior Level of Living Comfort
COMFORIA is the name we have given to the urban rental residences produced by the Tokyu Land Corporation.
The word COMFORIA is a compound that we coined from “comfort,” and “ia,” a Latin suffix meaning “place.”
The idea that residences are not just containers has given birth to our COMFORIA series of rental residences madespecifically for people who wish to live freely and affluently in urban communities.
COMFORIA offers living comfort beyond expectation and surpasses the level of mere convenience in many ways.
Four Advantages COMFORIA Offers

Location

Quality

SafetyService

COMFORIA knows
how valuable time is.

COMFORIA knows
what high quality
feels like.

COMFORIA knows
where peace of mind
comes from.

COMFORIA knows
how residents feel.

In the 2018 assessment, the Investment Corporation received high marks for excellencein both the Management & Policy and Implementation & Measurement categories for
eco-friendliness and sustainability, earning a Green Star rating.
The Investment Corporation will use participation in the GRESB Real Estate Assessment as
an opportunity to improve sustainability initiatives.

C‌ OMFORIA SHINJUKU EASTSIDE TOWER‌ Value Chain of the Tokyu Fudosan Holdings GroupWe have concluded sponsor support agreements, support agreements and property management agreements for managed assets with
the Asset Management Company and the Tokyu Fudosan Holdings Group companies to fully utilize the value chain and expertise of the
Tokyu Fudosan Holdings Group. With the support of the Tokyu Fudosan Holdings Group companies through such agreements, we aim
to expand our asset size (external growth), and maintain and increase asset value (internal growth).

Sponsor support
Sponsor support
agreement

TOKYU LAND CORPORATION

Rental residence management
Property information

Support agreement/
PM contract

Tokyu Housing Lease Corporation

Support agreement

TOKYU LIVABLE, INC.

TLC REIT Management Inc.

Services for residents
Support agreement

EWEL, Inc.

Support agreement

TOKYU SPORTS OASIS, Inc.

16

Support agreement

TOKYU COMMUNITY CORP.

Management of operational rental residences
Support agreement(condominiums
for students)

National Students Information Center Co., Ltd.

Support agreement(housing forthe elderly)

TOKYU E-LIFE DESIGN Inc.

17

Overview of the Investment Corporation andAsset Management Company
O‌ verview of the Investment Corporation
Name of the investment
corporation

Comforia Residential REIT, Inc

Representative

Takehiro Izawa, Executive Director

Address

1- 1 Minami-Aoyama 1-chome, Minato-ku, Tokyo 107- 0062, Japan

Inquiries

TLC REIT Management Inc.
Tel: + 81- 3- 3401- 1090

Fiscal period-end

January 31 and July 31 each year

Asset Management Report for the 16th Fiscal Period(Semi-Annual Report)

From February 1, 2018 to July 31, 2018

History
June 8, 2010

Registration of incorporation, and foundation under Article 166 of the Act on Investment Trusts and Investment Corporations

June 30, 2010

Implementation of registration by the prime minister under Article 187 of the Act on Investment Trusts and Investment
Corporations (registration number: Director of Kanto Finance Bureau No. 71)

February 6, 2013

Listed on the Real Estate Investment Trust Securities Market of the Tokyo Stock Exchange

Structure
The Investment Corporation

Sponsor
TOKYU LAND CORPORATION

2

5Asset Management Company
TLC REIT Management Inc.

Asset Custodian General Administration(operation of the administrative instrument)
Transfer Agent
Mitsubishi UFJ Trust and Banking Corporation

1

Comforia Residential REIT, Inc
3

Unitholders’ Meeting

6

General Administration (accounting, etc.)

II.
III.

Heiseikaikeisha Tax Corporation

Supporting Company

Board of Directors

TOKYU LIVABLE, INC.
TOKYU COMMUNITY CORP.
Tokyu Housing Lease Corporation
TOKYU E-LIFE DESIGN Inc.
EWEL, Inc.
TOKYU SPORTS OASIS, Inc.
National Students Information
Center Co., Ltd.

Executive Director: Takehiro Izawa
Supervisory Director: Yoshihiro Kataoka
Supervisory Director: Koji Yamamoto

4

General Administration (corporation bonds)
Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.

Asset management agreement
Asset custody agreement,
Administrative service agreement,
Transfer agency agreement
3 Accounting service agreement

Fiscal, issuing and payment
agency agreement
Sponsor support agreement
6 Support agreement

1

4

2

AuditorErnst & Young ShinNihon LLC

5O‌ verview of the Asset Management Company (As of July 31, 2018)
Trade name

TLC REIT Management Inc.

Shareholder

Representative

Hiroyuki Tohmata, President & CEO

Address

1- 1 Minami-Aoyama 1-chome,
Minato-ku, Tokyo 107-0062, Japan

Established

October 2009

Capital¥200 million

Financial Instruments Business Firm, granted by the Directorof the Kanto Regional Finance Bureau (Financial Instruments)
Registration No. 2370
Registrations/
Discretionary Transaction Agent granted by the Minister ofLicenses
Land, Infrastructure, Transport and Tourism, Registration No. 65
Building Lots and Building Transactions Business License,
granted by the Governor of Tokyo (2) No. 91139

Overview of Organization

Asset Management Report
Comforia Residential REIT, Inc
Financial Section
1-1
Minami-Aoyama
1-chome, Minato-ku,
Balance SheetsTokyo
107-0062, Japan
Statements of Income
Statements of Changes in Unitholders’ Equity
Statements of Cash Distributions
Statements of Cash Flows
Notes
Supplementary Schedules
Independent Auditor’s Report

Tokyu Land Corporation 100%

Shareholders’ Meeting
Corporate Auditor
Board of Directors

Investment Committee

Compliance Committee
President & CEO
Acquisition Priority Review Meeting

Internal Audit Dept.

Compliance Dept.
Activia
Management Div.

Corporate Planning &Administration Dept.

18

Finance &Accounting Dept.

Asset Investment
Dept.

Environmental
Engineering Dept.

Strategic
Mgt. Dept.

Asset
Mgt. Dept.

Comforia
Management Div.
Strategic
Mgt. Dept.

Asset
Mgt. Dept.

Broadia
Management Div.
Strategic
Mgt. Dept.

Asset
Mgt. Dept.

19

II Asset Management Report
II. Asset Management Report

Overview of Asset Management

2. Asset Management Status for the 16th Fiscal Period

1. Performance of the Investment Corporation
Fiscal period

12th
Fiscal Period

13th
Fiscal Period

14th
Fiscal Period

15th
Fiscal Period

16th
Fiscal PeriodBusiness period

FromFeb. 1, 2016 toJul. 31, 2016

From
Aug. 1, 2016 toJan. 31, 2017

From
Feb. 1, 2017 toJul. 31, 2017

From
Aug. 1, 2017 toJan. 31, 2018

From
Feb. 1, 2018 toJul. 31, 2018

Operating revenue(millions of yen)

6,531

6,674

7,276

7,357

8,147

[Rent revenue - real estate](millions of yen)

[6,531][6,674][7,276][7,357][7,771]

Operating expenses(millions of yen)

3,785

3,885

4,178

4,188

4,444

[Expenses related to rent business](millions of yen)

[3,196][3,249][3,518][3,496][3,745]

Operating profit(millions of yen)

2,746

2,788

3,098

3,168

3,703

Ordinary profit(millions of yen)

2,312

2,341

2,613

2,680

3,204

Profit(millions of yen)

2,304

2,335

2,608

2,674

3,191

Total assets(millions of yen)

179,944

183,902205,121206,171219,211(%)[13.0][2.2][11.5]

[0.5]

[6.3]

(millions of yen)

85,13985,171

97,25897,294

103,043(%)[10.0][0.0][14.2]

[0.0]

[5.9]

(millions of yen)

82,74382,743

94,557

94,557

99,814

Number of investment units issued(units)513,504

513,504

563,694563,694586,994

Net assets per unit

(yen)

165,801

165,863

172,537

172,601

175,544

Total distributions(millions of yen)

2,304

2,335

2,638

2,698

2,926

[Period-on-period change]
Net assets[Period-on-period change]
Unitholders’ capital

Distribution per unit (DPU)

(yen)

4,487

4,549

4,681

4,788

4,985

[Earnings distribution per unit](yen)[4,487][4,549][4,681][4,788][4,985][Distribution in excess of earnings
per unit]

(yen)

[－]

[－]

[－]

[－]

[－]

Return on assets(Note 1)

(%)

1.4

1.3

1.3

1.3

1.5

Return on unitholders’ equity(Note 2)

(%)

2.8

2.7

2.9

2.7

3.2

Unitholders’ equity ratio(Note 3)

(%)

47.3

46.3

47.4

47.2

47.0

[Period-on-period change]
Interest-bearing debt
Interest-bearing debt ratio (LTV)(Note 4)

Payout ratio(Note 5)(%)[-1.3][-1.0][1.1][-0.2][-0.2](millions of yen)

91,06094,970103,620

104,750

111,730

(%)

50.6

51.6

50.5

50.8

51.0

(%)

99.9

100.0

101.1

100.9

91.6

Number of properties(properties)

Total leasable area(m2)

Occupancy rate at end of period
Depreciation
Capital expenditure
NOI(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)

98

101

110

111

117

272,172.73

278,745.27

303,025.09

304,126.02

318,999.87

(%)

96.3

96.5

96.1

96.7

96.6

(millions of yen)

1,017

1,049

1,137

1,152

1,200

(millions of yen)

131

112

(millions of yen)

4,352
4,474
Ordinary profit ÷ [(Total assets at beginning of period + Total assets at end of period) ÷ 2] × 100
Profit ÷ [(Net assets at beginning of period + Net assets at end of period) ÷ 2] × 100
Net assets at end of period ÷ Total assets at end of period × 100
Interest-bearing debt at end of period ÷ Total assets at end of period × 100
Total distributions ÷ Profit × 100
Payout ratio is rounded down to the first decimal place.
Income from real estate rental business + Depreciation(Note 6)

-1-

20

386

274

281

4,896

5,013

5,227

(1) History of the Investment Corporation
Comforia Residential REIT, Inc (the “Investment Corporation”) was established on June 8, 2010 as an investment corporationthat invests mainly in residential properties in accordance with the “Act on Investment Trusts and Investment Corporations”
of Japan (Act No. 198 of 1951, as revised; hereinafter referred to as the “Investment Trusts Act”), with registration by theprime minister completed as of June 30, 2010 under Article 187 of the Investment Trusts Act (registration number: Director of
Kanto Finance Bureau No. 71). Investments by the Investment Corporation commenced in August 2010. The Investment
Corporation issued new investment units (18,691 units) through a public offering on February 6, 2013 and was listed on thereal estate investment trust market of the Tokyo Stock Exchange, Inc. (securities code: 3282).
Managed assets of the Investment Corporation at the commencement of operations totaled 11 properties, acquired for a
total of ¥15,508 million. As a result of additional acquisition and sale of properties under the basic policy of asset management(to manage assets with the aim of achieving stable earnings and ensuring the steady growth of our managed assets based on
medium- to long-term perspectives to maximize our unitholders’ value) stipulated in the regulations of the Investment
Corporation, the portfolio (the “Acquired Assets”) owned as of the end of the 16th Fiscal Period includes 117 properties,
acquired for a total of ¥202,182 million.
(2) Investment performance(i) Investment environment
During the 16th Fiscal Period, the Japanese economy remained on a modest recovery trend amid improvements in theemployment and income environment. Under these circumstances, in the residential rental market, unit rent has shown an
upward trend centering on central Tokyo while occupancy rate remained high. In the real estate investment market, thelevel of transaction prices remains stable at a high price range amid an ongoing low interest rate environment resulting
from the fiscal policies of the government and monetary policies of the Bank of Japan (BOJ).
(ii) Acquisition and sale of assets
During the 16th Fiscal Period, the Investment Corporation acquired four properties including COMFORIA UENOIRIYA
and three other properties in February 2018. Subsequently, three other properties were acquired including COMFORIA
AKABANEIWABUCHI, and COMFORIA YOKOHAMAKANNAI was sold in March 2018. Furthermore, COLLEGESQUARE HACHIMANYAMA was acquired in May 2018 and COMFORIA KOMAE was sold in June 2018. As a result,assets owned by the Investment Corporation as of the end of the 16th Fiscal Period totaled 117 properties with a totalacquisition price of ¥202,182 million.
(iii) Operation management of assets owned by the Investment Corporation
The Investment Corporation consigns property management operations mainly to Tokyu Housing Lease Corporation,
which has an extensive track record in managing the Comforia series of properties. Under the Comforia series, theInvestment Corporation promotes unified management and strives to improve operational efficiency and shorten periodsof vacancy.
(3) Overview of funding
During the 16th Fiscal Period, the Investment Corporation undertook additional issuance of investment units (23,300 units)
and borrowing of funds (¥2,960 million) for the acquisition of four properties including COMFORIA UENOIRIYA in February
2018 and for the repayment of borrowings (¥1,130 million) made in August 2017. Subsequently, the Investment Corporation
borrowed funds (¥12,340 million) in March 2018 for the acquisition of three properties including COMFORIA
AKABANEIWABUCHI and for the repayment of borrowings (¥6,900 million) made in September 2013 and February 2015.
Furthermore, investment corporation bonds (¥2,500 million) were issued in June 2018 to be appropriated for part of therepayment funds (¥2,790 million) for borrowings made in March 2018. Consequently, as of the end of the 16th Fiscal Period(July 31, 2018), unitholders’ capital was ¥99,814 million, interest-bearing debt was ¥111,730 million, the ratio of interestbearing debt to total assets (LTV) was 51.0%, the average maturity of interest-bearing debt was 4.4 years, the ratio of longterm debt was 82.0%, and the fixed rate ratio was 88.7%. Moreover, the Investment Corporation executed a Line of Credit
Loan Master Agreement (on an uncommitted basis) as of February 9, 2018, in case the need arises to raise funds to purchaseassets for future investments or other purposes.
The Investment Corporation obtained the following rating as of the end of the 16th Fiscal Period.
Name of credit rating agency

RatingOutlookJapan Credit Rating Agency, Ltd. (JCR)

AA–

Stable(4) Overview of performance and distributions
As a result of investment during the 16th Fiscal Period, the Investment Corporation posted operating revenue of ¥8,147 million,
operating profit of ¥3,703 million, ordinary profit of ¥3,204 million, and profit of ¥3,191 million.
The Investment Corporation carries out distributions so that the Special Provisions for Taxation on Investment Corporations(Article 67-15 of the Act on Special Measures Concerning Taxation [Act No. 26 of 1957, as revised; hereinafter referred to as
the “Act on Special Measures Concerning Taxation”]) would be applied. For the 16th Fiscal Period, the Investment Corporation
retained part (¥285 million) of gain on sales by applying the Special Provisions on Taxation in the case of advance acquisitionof land and such in 2009 and 2010 (Article 66-2 of the Act on Special Measures Concerning Taxation), after adding the reversalof reserve for reduction entry to unappropriated retained earnings. As a result, the distribution per unit (DPU) was ¥4,985 forthe period.

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21

3. Capital Increases
Date

4. Performance of Distributions
Number of investment units
issued (units)

Type

ChangeBalanceUnitholders’ capital(millions of yen)
ChangeRemarks

Balance

June 8, 2010

Establishment throughprivate placement

200

200

100

100

(Note 1)

August 30, 2010

Capital increase throughprivate placement

7,800

8,000

3,900

4,000

(Note 2)

March 18, 2011

Capital increase throughprivate placement

24,27032,27011,84015,840(Note 3)February 2, 2012

Capital increase throughprivate placement

16,40048,6708,200

24,040(Note 4)

February 5, 2013

Capital increase throughpublic offering

18,691

67,361

9,935

33,975(Note 5)February 3, 2014

Capital increase throughpublic offering

31,90099,261

21,96055,936(Note 6)

February 26, 2014

Capital increase throughthird-party allotment

1,401

100,662964

56,900(Note 7)

August 1, 2014

Investment unit split

301,986

402,648–

56,900(Note 8)February 2, 2015

Capital increase throughpublic offering

70,000472,648

18,02574,926(Note 9)February 27, 2015

Capital increase throughthird-party allotment

1,156

473,804297

February 1, 2016

Capital increase throughpublic offering

37,800511,604

7,159

February 26, 2016

Capital increase throughthird-party allotment

1,900

513,504359

82,743 (Note 12)

February 1, 2017

Capital increase throughpublic offering

47,800561,304

11,251

93,995 (Note 13)

February 22, 2017

Capital increase throughthird-party allotment

2,390

563,694562

94,557 (Note 14)

February 1, 2018

Capital increase throughpublic offering

22,190585,884

5,006

99,563 (Note 15)

February 15, 2018

Capital increase throughthird-party allotment

1,110

586,994250

99,814 (Note 16)

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

15th Fiscal Period

16th Fiscal PeriodBusiness period

From Feb. 1, 2016
to Jul. 31, 2016

From Aug. 1, 2016
to Jan. 31, 2017

From Feb. 1, 2017
to Jul. 31, 2017

From Aug. 1, 2017
to Jan. 31, 2018

From Feb. 1, 2018
to Jul. 31, 2018

¥2,304,285 thousand ¥2,336,057 thousand¥2,608,344 thousand¥2,674,584 thousand ¥3,191,695 thousand

Unappropriated retained earnings
Retained earnings
Total distributions[Distribution per unit (DPU)]
Of which, total earnings
distributions[Earnings distribution per unit]
Of which, total return on
unitholders’ capital¥193 thousand¥127 thousand¥17 thousand¥2,304,092 thousand ¥2,335,929 thousand¥2,638,651 thousand[¥4,487][¥4,549][¥4,681]¥2,304,092 thousand ¥2,335,929 thousand¥2,638,651 thousand¥186 thousand¥285,330 thousand¥2,698,966 thousand ¥2,926,165 thousand[¥4,788][¥4,985]¥2,698,966 thousand ¥2,926,165 thousand[¥4,487][¥4,549][¥4,681][¥4,788][¥4,985]¥– thousand¥– thousand¥– thousand¥– thousand¥– thousand[Return on unitholders’ capitalper unit]

[¥–]

[¥–]

[¥–]

[¥–]

[¥–]

82,383Of the total return on
unitholders’ capital, the total
distribution payments from theallowance for temporary
difference adjustment¥– thousand¥– thousand¥– thousand¥– thousand¥– thousand[Of the return on unitholders’capital per unit, the distribution
payment from the allowance fortemporary difference adjustment
per unit]

[¥–]

[¥–]

[¥–]

[¥–]

[¥–]

Of the total return on
unitholders’ capital, the total
distribution payments frominvestments and other decreased
distribution under tax laws¥– thousand¥– thousand¥– thousand¥– thousand¥– thousand[Of the total return on
unitholders’ capital per unit, thedistribution payments frominvestments and other decreased
distribution under tax laws]

[¥–]

[¥–]

[¥–]

[¥–]

[¥–]

(Note 11)

Established at an issue price of ¥500,000 per investment unit.
Issued privately placed investment units at an issue price of ¥500,000 per investment unit to fund the acquisition of new properties.
Issued privately placed investment units at an issue price of ¥500,000 (subscription price of ¥487,852) per investment unit to fund the acquisition of
new properties and repay loans.
(Note 4) Issued privately placed investment units at an issue price of ¥500,000 per investment unit to fund the acquisition of new properties and repay loans.
(Note 5) Issued investment units at an issue price of ¥550,000 (subscription price of ¥531,575) per investment unit to fund the acquisition of new properties
and repay loans.
(Note 6) Issued investment units at an issue price of ¥712,530 (subscription price of ¥688,413) per investment unit to fund the acquisition of new properties
and repay loans.
(Note 7) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥688,413 per investment unit.
(Note 8) Carried out a four-for-one-split of investment units effective as of August 1, 2014, with July 31, 2014 as the record date.
(Note 9) Issued investment units at an issue price of ¥266,253 (subscription price of ¥257,514) per investment unit to fund the acquisition of new properties
and repay loans.
(Note 10) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥257,514 per investment unit.
(Note 11) Issued investment units at an issue price of ¥195,828 (subscription price of ¥189,400) per investment unit to fund the acquisition of new properties
and repay loans.
(Note 12) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥189,400 per investment unit.
(Note 13) Issued investment units at an issue price of ¥243,252 (subscription price of ¥235,393) per investment unit to fund the acquisition of new properties
and repay loans.
(Note 14) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥235,393 per investment unit.
(Note 15) Issued investment units at an issue price of ¥233,132 (subscription price of ¥225,600) per investment unit to fund the acquisition of new properties
and to repay loans.
(Note 16) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥225,600 per investment unit.

[Fluctuation in market price of the investment securities]
The highest and lowest prices (closing price) in the real estate investment trust market of the Tokyo Stock Exchange, Inc., where theInvestment Corporation is listed, by fiscal period are as follows.

22

Fiscal period

75,224 (Note 10)(Note 1)
(Note 2)
(Note 3)Fiscal period

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

15th Fiscal Period

Closing month/year

Jul. 2016

Jan. 2017

Jul. 2017

Jan. 2018

Jul. 2018

Highest¥250,900¥262,500¥261,600¥250,500¥267,300

Lowest¥206,900¥231,600¥219,400¥228,100¥228,000-3-The Investment Corporation pays out distributions per unit (DPUs) with the intent of including the maximum amount of earnings
distributions in deductible expenses by applying special measures concerning taxation (Article 67-15 of the Act on Special Measures
Concerning Taxation). For the 16th Fiscal Period, the Investment Corporation decided to retain part of the gain on sales by applying
the Special Provisions on Taxation in the case of advance acquisition of land and such in 2009 and 2010 (Article 66-2 of the Act on
Special Measures Concerning Taxation), after adding the reversal of reserve for reduction entry to unappropriated retained earnings.
Based on this policy, the Investment Corporation has decided to distribute the amount of unappropriated retained earnings after
deducting ¥285 million, which is within the scope where the provisions of Article 67-15 of the Act on Special Measures Concerning
Taxation are applied, as well as within the limit of reserve for reduction entry stipulated in Article 66-2 of the Act on Special
Measures Concerning Taxation, as provision of reserve for reduction entry. As a result, the DPU for the 16th Fiscal Period
was ¥4,985.

16th Fiscal Period(Note) Figures above are rounded down to the nearest unit.

5. Future Investment Policy and Issues to Address
Founded on our basic policies of investment management, the Investment Corporation acquired eight properties and sold two
properties during the 16th Fiscal Period, and has carried out investment and management based on the concept and expertise
incorporated into the urban rental residence Comforia series, which Tokyu Land Corporation (hereinafter referred to as “Tokyu
Land”) has been producing. Going forward, we aim to achieve medium- to long-term growth by continuing to carry out investment
and management based on our basic policies.
(1) External growth strategy
The Investment Corporation aims to acquire higher quality assets and expand the asset size, fully utilizing the support of the
Tokyu Fudosan Holdings Group, primarily the sponsor support of Tokyu Land, and original information from TLC REITManagement Inc., its asset management company (hereinafter referred to as the “Asset Management Company”).
Specifically, we will acquire properties developed by our sponsor, Tokyu Land, using the sponsor support agreement theAsset Management Company entered into with Tokyu Land, and continually and steadily acquire quality residential properties
that are under stable operation. In addition, we intend to utilize real estate brokerage capabilities through the vast information
network of Tokyu Fudosan Holdings Group companies, who are not our sponsors, to acquire quality residential properties,
achieve stable operation and enhance profitability. Based on this perspective, the Asset Management Company has entered intoa support agreement with each of the seven support companies of the Tokyu Fudosan Holdings Group companies (Tokyu
Livable, Inc., Tokyu Community Corp., Tokyu Housing Lease Corporation, Tokyu E-Life Design Inc., Ewel Inc., Tokyu Sports
Oasis, Inc., and National Students Information Center Co., Ltd.) for managed assets of the Investment Corporation.

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23

(2) Internal growth strategy
With the aim of maximizing portfolio value and cash flows from individual properties from a medium- to long-term perspective
and to make the most of the experience and comprehensive strength of the Tokyu Fudosan Holdings Group in property
management, we will consign property management operations mainly to Tokyu Fudosan Holdings Group companies, whichhave extensive experience in the management of J-REITs and the Comforia series. In addition, we will strive for efficientmanagement by examining the adequacy of building management specifications and costs.
Furthermore, we will actively utilize the expertise of Tokyu Fudosan Holdings Group in asset and fund management toachieve higher-quality overall management of the Investment Corporation.
In the 17th Fiscal Period and onwards, we will continue to aim to maintain and improve occupancy rates by closely
monitoring the property management situation, as we did in the 16th Fiscal Period.

Overview of the Investment Corporation(3) Financial strategy
In consideration of addressing future interest rate risk and refinance risk, we will carry out funding activities by paying attention
to financial soundness and earnings stability. With regard to debt, we will efficiently combine short-term funding that focuseson agility with long-term stable funding. Furthermore, we will consider the issuance of new investment units in accordancewith financing needs for property acquisition and the financial situation of the Investment Corporation, while paying attention
to the market development and distribution level, with the upper limit of the ratio of interest-bearing debt to total assets (LTV)
at around 60%.

Total number of authorized
investment units
Total number of investment
units issued

1. Unitholders’ Capital
12th Fiscal
Period13th Fiscal
Period14th Fiscal
Period15th Fiscal
Period16th Fiscal
PeriodAs ofJul. 31, 2016

As ofJan. 31, 2017

As ofJul. 31, 2017

As ofJan. 31, 2018

As ofJul. 31, 2018

(units)8,000,000

8,000,000

8,000,000

8,000,000

8,000,000(units)513,504

513,504

563,694563,694586,994

Unitholders’ capital(millions of yen)

82,74382,743

94,557

94,557

99,814

Number of unitholders(people)

7,749

6,834

7,897

7,269

6,847

2. Matters concerning Investment Units
Major unitholders as of July 31, 2018 are as follows.

6. Significant Scheduled Events(Reference Information)
Property Acquisition
The Investment Corporation acquired the following property:
Property name

Number of investment units
owned (units)

Name

Not applicable

Type of specified asset

Location

Acquisition price(thousands of yen)
(Note)

Main usage

Acquisition date

Yokohama-shi,Homes for the
GRANCREER
Property in trust
4,150,000
September 25, 2018
CENTER-MINAMI
Kanagawa
elderly(Note)
The acquisition price does not include miscellaneous expenses required for the acquisition of each property, fixed
property tax, city planning tax, consumption tax and local consumption tax.

Ratio to the total number ofinvestment units issued (%) (Note)

Japan Trustee Services Bank, Ltd. (trust account)

169,846

28.93

The Master Trust Bank of Japan, Ltd. (trust account)

78,22813.32

Tokyu Land Corporation

51,6648.80

The Nomura Trust & Banking Co., Ltd. (trust account)

22,3303.80

Trust & Custody Services Bank, Ltd.
(securities trust investment account)

14,835

2.52

Mitsubishi UFJ Trust and Banking Corporation(Standing proxy: The Master Trust Bank of Japan, Ltd.)

10,982

1.87

Trust & Custody Services Bank, Ltd.
(taxable trust money account)

9,430

1.60

The Asahi Fire And Marine Insurance Company Limited

8,600

1.46

The State Street Bank West Client—Treaty 505234(Standing proxy: Settlement & Clearing Services Department,
Mizuho Bank, Ltd.)

8,356

1.42

The Gunma Bank, Ltd.
Total
(Note)

7,339

1.25

381,61065.01

The ratio of investment units owned to the total number of investment units issued is rounded down to the second decimal place.

3. Matters concerning Directors, etc.
(1) Name of directors, etc.
The names of directors, etc. during the 16th Fiscal Period are as follows.
Position

Name of director,
etc.

Main concurrent posts

Total amount of remuneration
paid during the period(thousands of yen)

Executive
Director(Note 1)

Takehiro Izawa

Executive Director, Chief Division Officer ofComforia Management Division, TLC REITManagement Inc.

–

Supervisory
Director(Note 1)

Yoshihiro
KataokaHead of Kataoka & Kobayashi
Outside Audit & Supervisory Board Member,
The Higo Bank, Ltd.

1,800

Supervisory
Director(Note 1)

Koji Yamamoto

Partner, WAKABA PARTNERS Law andAccounting Office
Supervisory Officer, Toshi Saisei Fund Investment
Corporation

1,800

Independent
AuditorErnst & Young
ShinNihon LLC(Note 2)–

15,842(Note 1) None of the Executive Director or Supervisory Directors own investment units in the Investment Corporation, either in their own name or insomeone else’s name. Furthermore, although Supervisory Directors may be officers of a corporation other than those mentioned above, neither
one has an interest in the Investment Corporation.
(Note 2) The amount includes the fees pertaining to the production of an “Auditor’s Comfort Letter to Lead Underwriting Firm” related to the issuanceof investment corporation bonds in June 2018.

24

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-6-

25

(2) Policy for decisions on dismissal or non-reappointment of Independent Auditor
The Board of Directors shall, with the consent of all its members, dismiss the Independent Auditor if it is deemed that it falls
under any of the grounds set forth in each item of Paragraph 1 of Article 105 of the Investment Trusts Act, and when it isdetermined that there is no hope for improvement.
In addition, when it is determined that an Independent Auditor is not fit for his or her role, upon comprehensive
examination of their execution of duties as the Independent Auditor and other circumstances, the Board of Directors shalldismiss or not reappoint said Independent Auditor with the consent of all of its members, and forward a proposal for theappointment of a new Independent Auditor to the unitholders’ meeting.

4. Asset Management Company, Asset Custodian and General Administration
The asset management company, asset custodian and general administration as of July 31, 2018 are as follows.
Consignment segment

Status of Managed Assets of the Investment Corporation
1. Composition of Assets of the Investment Corporation
Type of
asset

Area

TLC REIT Management Inc.

Asset custodian

Mitsubishi UFJ Trust and Banking Corporation

General administration (unitholder registry administration)

Mitsubishi UFJ Trust and Banking Corporation

General administration (accounting service)

Heiseikaikeisha Tax Corporation

General administration (administrative service)

Mitsubishi UFJ Trust and Banking Corporation

General administration (corporation bond service)

Sumitomo Mitsui Trust Bank, Limited, MUFG Bank, Ltd.

Total amount owned(millions of yen) (Note 1)

Percentage of total
assets (%) (Note 2)

Total amount owned(millions of yen) (Note 1)

Percentage of total
assets (%) (Note 2)

Central Tokyo

1,139

0.6

1,136

0.5

Sub-central Tokyo

3,188

1.5

4,953

2.3

Other major cities

1,042

0.5

1,034

0.5

Central Tokyo

83,97740.7

85,863

39.2

Properties Sub-central Tokyo
in trust Tokyo metropolitan area

82,70040.1

92,248

42.1

4,685

2.3

3,319

1.5

12,590

6.1

14,286

6.5

189,32391.8

202,84292.5

RealestateName

Asset management company

16th Fiscal Period(as of July 31, 2018)

15th Fiscal Period(as of January 31, 2018)

Other major cities
Subtotal
Deposits and other assets

16,847

8.2

16,368

7.5

Total assets

206,171

100.0

219,211100.0(Note 1)
(Note 2)

“Total amount owned” shows the amount posted on the balance sheets as of the closing of accounts (the book value after depreciation for real estateand properties in trust).
The sum may not total 100.0% since figures are rounded to the first decimal place.

2. Major Assets Owned
The overview of major assets owned by the Investment Corporation (top 10 properties in terms of period-end book value)is as follows.
Rentable area(m2)

Rented area
(m2)

COMFORIA SHINJUKUEASTSIDE TOWER

13,552

48,267.60

46,523.02

96.4

19.5

Apartment
building

COMFORIA KAMATA

5,851

6,027.98

5,783.57

95.9

2.1

Apartment
building

COMFORIA KOMABA

5,187

5,342.38

5,133.22

96.1

1.7

Apartment
building

COMFORIA
MINAMISUNAMACHI

4,660

6,141.98

5,845.70

95.2

1.7

Apartment
building

COMFORIA AKIHABARA
EAST

4,515

4,582.07

4,453.47

97.2

1.6

Apartment
building

COMFORIA KITASANDO

4,236

4,967.84

4,779.62

96.2

1.7 Residence

COMFORIA
ITABASHINAKAJUKU

3,971

6,966.04

6,829.24

98.0

1.6

Apartment
building

COMFORIAHIGASHIIKEBUKURO WEST

3,750

6,436.14

6,180.86

96.0

2.1

Apartment
building

COMFORIA HARAJYUKU

3,581

4,528.51

4,442.10

98.1

1.6

Apartment
building

COMFORIA TAMACHI

3,395

4,250.35

4,194.50

98.7

1.3

Apartment
building

52,704

97,510.89

94,165.30

96.6

35.0

Total

26

-7-

Ratio to total
Occupancy rate
rental revenues Main usage(%)(%)

Book value(millions of yen)

Property name

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27

3. Statement of Properties Incorporated in the Portfolio
Area

The overview of assets under management of the Investment Corporation as of July 31, 2018 is as follows.
Area

Property name

Address

Property name

Address

COMFORIA WASEDA

147 Bentencho, Shinjuku-ku, Tokyo

COMFORIA SHIMOOCHIAI

2-7-10 Nakaochiai, Shinjuku-ku, Tokyo

COMFORIA HIGASHINAKANO

4-34-2 Kita-Shinjuku, Shinjuku-ku, Tokyo

COMFORIA GINZA EAST

1-3-1 Irifune, Chuo-ku, Tokyo

COMFORIA AZABUDAI

3-4-4 Azabudai, Minato-ku, Tokyo

COMFORIA SHIBAKOEN

2-2-15 Shibakoen, Minato-ku, Tokyo

COMFORIA NISHIAZABU

4-1-10 Nishiazabu, Minato-ku, Tokyo

COMFORIA MINAMIAOYAMA

4-1-12 Minami-Aoyama, Minato-ku, Tokyo

COMFORIA MINAMIAOYAMA
DEUX

4-2-1 Minami-Aoyama, Minato-ku, Tokyo

COMFORIA NISHIWASEDA

1-5-19 Takadanobaba, Shinjuku-ku, Tokyo

COMFORIA HARAJYUKU

3-61-3 Sendagaya, Shibuya-ku, Tokyo

COMFORIA MITA NORTH

2-7-16 Mita, Minato-ku, Tokyo

COMFORIA SHIBAURABOWHOUSE

3-13-12 Kaigan, Minato-ku, Tokyo

COMFORIASHIROKANETAKANAWA

5-1-21 Mita, Minato-ku, Tokyo

COMFORIA NIHONBASHININGYOCHO EAST

3-6-3 Nihonbashi Ningyocho, Chuo-ku, Tokyo

COMFORIA ATAGO

3-23-7 Toranomon, Minato-ku, Tokyo

COMFORIA KUDAN

2-6-12 Kudan Minami, Chiyoda-ku, Tokyo

COMFORIA NIHONBASHININGYOCHO NORTH

1-1-6 Nihonbashi Horidomecho, Chuo-ku, Tokyo

COMFORIA SHINKAWA

2-15-5 Shinkawa, Chuo-ku, Tokyo

COMFORIA AKASAKA

2-17-63 Akasaka, Minato-ku, Tokyo

COMFORIA MITA EAST

4-18-1 Shiba, Minato-ku, Tokyo-9-

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

2,140

1,536

2,470

1,876

1,570

1,107

687

550

COMFORIA SHIBAURA CANAL

3-1-9 Kaigan, Minato-ku, Tokyo

COMFORIA KITASANDO

4-5-10 Sendagaya, Shibuya-ku, Tokyo

COMFORIA YOYOGIUEHARA

2-31-5 Uehara, Shibuya-ku, Tokyo

COMFORIA SASAZUKA

1-59-10 Sasazuka, Shibuya-ku, Tokyo

3,980

2,994

770

557

1,770

1,330

938

730

1,550

1,065

411

255

2,130

1,608

4,700

3,581

1,050

863

3,340

2,567

1,590

1,316

2,520

2,081

958

816

1,520

COMFORIA SHINJUKUGYOEN II 1-13-3 Shinjuku, Shinjuku-ku, Tokyo

Central Tokyo

Central Tokyo28

3-5-10 Nihonbashi Ningyocho, Chuo-ku, Tokyo

Appraisal value
Book value
at end of period(millions of yen)(millions of yen)
(Note 2)
(Note 1)

Appraisal value
Book value
at end of period
Ownership form
(millions of yen)(millions of yen)
(Note 2)
(Note 1)COMFORIA NIHONBASHININGYOCHO

Ownership form

COMFORIA
ICHIGAYAYANAGICHO

18-2 Ichigaya Yanagicho, Shinjuku-ku, Tokyo

COMFORIA KAGURAZAKA

26-1 Iwatocho, Shinjuku-ku, Tokyo

COMFORIA NIBANCHO

4-8 Nibancho, Chiyoda-ku, Tokyo

COMFORIA NISHISHINJUKU

1-20-12 Kita-Shinjuku, Shinjuku-ku, Tokyo

COMFORIA KANDAJINBOCHO

1-42-2 Kanda Jinbocho, Chiyoda-ku, Tokyo

COMFORIA NIHONBASHI

1-2-2 Nihonbashi Bakurocho, Chuo-ku, Tokyo

COMFORIA TAMACHI

4-5-13 Shibaura, Minato-ku, Tokyo

COMFORIA AZABUJUBAN

1-2-15 Mita, Minato-ku, Tokyo

COMFORIA SHINJUKUGYOEN I 1-10-4 Shinjuku, Shinjuku-ku, Tokyo
COMFORIA KAGURAZAKA
DEUX

7-3 Iwatocho, Shinjuku-ku, Tokyo

COMFORIA AZABU EAST

2-29-1 Higashi-Azabu, Minato-ku, Tokyo

COMFORIA SHINJUKUEASTSIDE TOWER(Tower Building)
6-27-29 Shinjuku, Shinjuku-ku, Tokyo(Annex Building)
6-27-28 Shinjuku, Shinjuku-ku, Tokyo(Gate Building)
6-27-14 Shinjuku, Shinjuku-ku, Tokyo

1,266

COMFORIA ICHIGAYAYAKUOJI

74-23 Ichigayayakuojimachi, Shinjuku-ku, Tokyo

1,310

1,084

COMFORIA AKIHABARA EAST

2-9-19 Higashikanda, Chiyoda-ku, Tokyo

2,110

1,809

COMFORIA MITA TROIS

3-43-6 Shiba, Minato-ku, Tokyo

2,540

1,928

COMFORIA SHIBAURA

2-3-33 Shibaura, Minato-ku, Tokyo

COMFORIA SHINJUKU

5-8-20 Shinjuku, Shinjuku-ku, Tokyo

3,720

3,118

Subtotal- 10 -

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Real estate
Beneficial
interest in realestate trust

1,860

1,535

5,000

4,236

1,850

1,600

2,200

1,772

2,200

1,778

1,970

1,602

883

724

1,910

1,631

1,750

1,707

1,630

1,491

2,160

1,970

3,680

3,395

1,620

1,480

1,500

1,417

1,400

1,256

2,870

1,926

15,20013,552

970

991

4,710

4,515

901

939

1,150

1,136

2,300

2,290

103,488

87,00029

AreaProperty name

Address

Ownership form

Appraisal value
Book value
at end of period(millions of yen)(millions of yen)
(Note 2)Area

Property name

Address

Ownership form

COMFORIA BUNKYOKASUGA

1-15-12 Nishikata, Bunkyo-ku, Tokyo

COMFORIAASAKUSAMATSUGAYA

1-11-5 Matsugaya, Taito-ku, Tokyo

COMFORIA NISHIOI

6-6-1 Nishi-Oi, Shinagawa-ku, Tokyo

COMFORIA NAKANO

2-40-12 Kamitakada, Nakano-ku, Tokyo

COMFORIA SHIMOKITAZAWA

1-9-14 Hanegi, Setagaya-ku, Tokyo

COMFORIA NISHIKAMATA

6-37-3 Nishi-Kamata, Ota-ku, Tokyo

COMFORIA OYAMA

4-4 Oyamacho, Itabashi-ku, Tokyo

COMFORIA
KIYOSUMISHIRAKAWA SOUTH

3-2-13 Miyoshi, Koto-ku, Tokyo

COMFORIA KOMAZAWA

2-1-5 Komazawa, Setagaya-ku, Tokyo

COMFORIA KOISHIKAWA

2-17-27 Koishikawa, Bunkyo-ku, Tokyo

COMFORIA SENGOKU

4-3-20 Sengoku, Bunkyo-ku, Tokyo

COMFORIA
DAIKANYAMAAOBADAI

2-1-7 Aobadai, Meguro-ku, Tokyo

COMFORIA IKEBUKURO

2-57-1 Ikebukuro, Toshima-ku, Tokyo

COMFORIA
RYOGOKUISHIWARA

1-36-1 Ishiwara, Sumida-ku, Tokyo

COMFORIA ASAKUSABASHI
DEUX

5-24-10 Asakusabashi, Taito-ku, Tokyo

COMFORIA OSHIAGE

4-7-2 Narihira, Sumida-ku, Tokyo

COMFORIA
HONJOAZUMABASHI

2-11-12 Honjo, Sumida-ku, Tokyo

COMFORIA
KIYOSUMISHIRAKAWA TROIS

3-5-14 Shirakawa, Koto-ku, Tokyo

COMFORIA MONZENNAKACHO 16-8 Fuyuki, Koto-ku, Tokyo
COMFORIA HIMONYA

2-3-3 Himonya, Meguro-ku, Tokyo

COMFORIA MISYUKU

3-23-2 Ikejiri, Setagaya-ku, Tokyo

COMFORIA GAKUGEIDAIGAKU 6-46-6 Shimouma, Setagaya-ku, Tokyo
COMFORIA HIGASHINAKANO
DEUX

30

4-2-19 Higashi-Nakano, Nakano-ku, Tokyo- 11 -(Note 1)

2,000

1,386

COMFORIAHIGASHIIKEBUKURO WEST

1,230

840

COMFORIA RYOGOKU DEUX

1-2-10 Chitose, Sumida-ku, Tokyo

1,040

877

COMFORIA OMORI DEUX

3-4-2 Omori Kita, Ota-ku, Tokyo

1,010

868

COMFORIA MACHIYA

5-51-7 Arakawa, Arakawa-ku, Tokyo

3,340

2,418

COMFORIA ASAKUSABASHI

2-20-10 Yanagibashi, Taito-ku, Tokyo

2,100

1,456

COMFORIA RYOGOKU SOUTH

2-14-8 Chitose, Sumida-ku, Tokyo

2,360

1,944

COMFORIA TOYOSU

1-4-12 Edagawa, Koto-ku, Tokyo

923

694

COMFORIA SUMIDATACHIBANA

5-18-5 Tachibana, Sumida-ku, Tokyo

1,670

1,231

COMFORIA UENOHIROKOJI

3-17-4 Ueno, Taito-ku, Tokyo

666

526

1,690

1,249

1,370

Sub-central Tokyo

Sub-central Tokyo(Note 1)

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

Appraisal value
Book value
at end of period(millions of yen)(millions of yen)
(Note 2)

3-22-21 Higashi-Ikebukuro, Toshima-ku, Tokyo

COMFORIA KASUGATOMISAKA 1-11-18 Kasuga, Bunkyo-ku, Tokyo
COMFORIA HONKOMAGOME

2-29-24 Honkomagome, Bunkyo-ku, Tokyo

921

COMFORIA MORISHITA

3-6-8 Shin-Ohashi, Koto-ku, Tokyo

672

572

COMFORIA KIBAKOEN

2-17-7 Kiba, Koto-ku, Tokyo

812

619

COMFORIA MEGUROCHOJAMARU

2-6-25 Kami-Osaki, Shinagawa-ku, Tokyo

1,020

852

COMFORIA NISHIMAGOME

2-35-8 Nishi-Magome, Ota-ku, Tokyo

846

698

COMFORIAHIGASHIIKEBUKURO EAST

2-8-1 Higashi-Ikebukuro, Toshima-ku, Tokyo

893

745

COMFORIAHIGASHIIKEBUKURO

4-3-5 Higashi-Ikebukuro, Toshima-ku, Tokyo

1,010

839

COMFORIA KOMABA

4-8-25 Ikejiri, Setagaya-ku, Tokyo

3,020

2,545

COMFORIA KINSHICHO

3-8-6 Taihei, Sumida-ku, Tokyo

1,590

1,181

COMFORIA
MINAMISUNAMACHI

4-4-20 Minamisuna, Koto-ku, Tokyo

2,480

1,808

1,510

1,120

1,100

806

- 12 -

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

5,210

3,750

1,280

1,014

1,390

1,186

865

595

3,380

2,589

1,560

1,200

3,610

2,991

982

944

1,240

1,086

3,500

2,860

1,690

1,314

1,810

1,487

1,130

931

2,430

1,976

1,130

977

2,380

1,677

1,370

1,149

5,340

5,187

1,210

1,053

4,880

4,660

31

Area

Property name

Address

Appraisal value
Book value
at end of period
Ownership form
(millions of yen)(millions of yen)
(Note 2)Sub-central Tokyo(Note 1)COMFORIAHIGASHISHINAGAWA

3-22-11 Higashi-Shinagawa,Shinagawa-ku, Tokyo

COMFORIA MEGUROYAKUMO

1-12-10 Yakumo, Meguro-ku, Tokyo

COMFORIA YOGA

3-24-3 Yoga, Setagaya-ku, Tokyo

COMFORIA
ITABASHINAKAJUKU

62-2 Nakajuku, Itabashi-ku, Tokyo

COMFORIA SHINAGAWA EAST

1-20-8 Kitashinagawa, Shinagawa-ku, Tokyo

COMFORIA OJIMACOMFORIA OMORI TROIS

4-8-10 Ojima, Koto-ku, Tokyo
3-36-7 Omorikita, Ota-ku, Tokyo

COMFORIA BUNKYO HAKUSAN 1-3-2 Honkomagome, Bunkyo-ku, Tokyo
COMFORIA KAMATA

4-21-2 Kamata, Ota-ku, Tokyo

COLLEGE COURTHACHIMANYAMA

1-15-1 Kamitakaido, Suginami-ku, Tokyo

COMFORIA UENOIRIYA

2-6-8 Ryusen, Taito-ku, Tokyo

COMFORIA IKEJIRI

2-31-18 Ikejiri, Setagaya-ku, Tokyo

COMFORIA
SETAGAYAKAMIUMA

3-6-11 Kamiuma, Setagaya-ku, Tokyo

COMFORIA
AKABANEIWABUCHI

26-11 Iwabuchimachi, Kita-ku, Tokyo

COMFORIA RYOGOKU TROIS

1-5-15 Kamezawa, Sumida-ku, Tokyo

COLLEGE SQUAREHACHIMANYAMA

1-15-2 Kamitakaido, Suginami-ku, Tokyo

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Real estate
Real estate
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Real estate
Beneficial
interest in realestate trust

Tokyo metropolitan area

Subtotal
COMFORIA ICHIKAWAMYODEN 1-9-10 Shioyaki, Ichikawa-shi, Chiba
COMFORIA YATSUKA

3-38-3 Sezaki, Soka-shi, Saitama

COMFORIA SHINKOYASU

2-216-2 Koyasudori, Kanagawa-ku, Yokohamashi, Kanagawa

COMFORIA GYOTOKU

2-1-13 Gyotokuekimae, Ichikawa-shi, Chiba

COMFORIA SHIN-OSAKA

1-21-24 Higashi-Nakajima, Higashiyodogawa-ku,
Osaka-shi, Osaka

COMFORIA SHINSAKAE

2-28-18 Shinsakae, Naka-ku, Nagoya-shi, Aichi

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

Other major cities

Subtotal

32

COMFORIA KITAHORIE

3-12-2 Kita-Horie, Nishi-ku, Osaka-shi, Osaka

COMFORIA KITASANJO

2-2-51 Kita-Sanjo Higashi, Chuo-ku, Sapporoshi, Hokkaido

COMFORIA SAPPOROSHOKUBUTSUEN

10-1-6 KitaNijo-Nishi, Chuo-ku, Sapporo-shi,
Hokkaido

COMFORIA OGIMACHI

3-7-15 Tenjinbashi, Kita-ku, Osaka-shi, Osaka- 13 -

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Real estate
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

1,680

1,544

879

854

1,100

1,076

4,200

3,971

1,570

1,524

2,250

2,250

920

925

1,410

1,403

6,070

5,851

1,250

1,280

2,230

2,246

1,400

1,391

2,690

2,696

2,520

2,646

1,680

1,777

890

914

113,478

97,201

740

603

698

616

1,260

1,051

994

1,047

3,692

3,319

2,790

2,317

1,810

1,672

1,080

1,034

981

675

1,290

1,326

1,540

1,521

COMFORIA SHINSAIBASHI
EAST

2-6-8 Bakuromachi, Chuo-ku, Osaka-shi, Osaka

COMFORIA KYOMACHIBORI

1-16-14 Kyomachibori, Nishi-ku, Osaka-shi,
Osaka

COMFORIA AWAZA

1-5-5 Enokojima, Nishi-ku, Osaka-shi, Osaka

COMFORIA KITAHAMA

2-1-14 Imabashi, Chuo-ku, Osaka-shi, Osaka(Note 1)

(Note 2)

Subtotal
Total

Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

2,010

2,047

1,620

1,613

1,340

1,334

1,780

1,778

16,241

15,320236,899
202,842“Appraisal value at end of period” indicates the appraisal value by a real estate appraiser (based on real estate appraisal reports or research reports
prepared by the Japan Real Estate Institute, Daiwa Real Estate Appraisal Co., Ltd., The Tanizawa Sōgō Appraisal Co., Ltd., JLL Morii Valuation &Advisory K.K. and Japan Valuers Co., Ltd., with the account closing date as the date of value estimate), pursuant to the method of asset appraisal
stipulated in the Articles of Incorporation of the Investment Corporation as well as the “Ordinance on Accountings of Investment Corporations”(Cabinet Office Ordinance No. 47 of 2006).
“Book value” indicates the acquisition price (including miscellaneous expenses related to the acquisition) as of the end of the 16th Fiscal Period(July 31, 2018) minus accumulated depreciation, and does not include construction in progress or construction in progress in trust.

- 14 -

33

15th Fiscal Period(from August 1, 2017 to January 31, 2018)

15th Fiscal Period(from August 1, 2017 to January 31, 2018)

Sub-central Tokyo

Central Tokyo

Area

34

Property name

COMFORIA NIHONBASHININGYOCHOCOMFORIA WASEDACOMFORIA SHIMOOCHIAICOMFORIA HIGASHINAKANOCOMFORIA GINZA EASTCOMFORIA AZABUDAICOMFORIA SHIBAKOENCOMFORIA NISHIAZABUCOMFORIA MINAMIAOYAMACOMFORIA MINAMIAOYAMADEUXCOMFORIA NISHIWASEDACOMFORIA HARAJYUKUCOMFORIA MITA NORTHCOMFORIA SHIBAURABOWHOUSECOMFORIASHIROKANETAKANAWACOMFORIA NIHONBASHININGYOCHO EASTCOMFORIA ATAGOCOMFORIA KUDANCOMFORIA NIHONBASHININGYOCHO NORTHCOMFORIA SHINKAWACOMFORIA AKASAKACOMFORIA MITA EASTCOMFORIA SHIBAURA CANALCOMFORIA KITASANDOCOMFORIA YOYOGIUEHARACOMFORIA SASAZUKACOMFORIA SHINJUKUGYOEN II
COMFORIA
ICHIGAYAYANAGICHOCOMFORIA KAGURAZAKACOMFORIA NIBANCHOCOMFORIA NISHISHINJUKUCOMFORIA KANDAJINBOCHOCOMFORIA NIHONBASHICOMFORIA TAMACHICOMFORIA AZABUJUBANCOMFORIA SHINJUKUGYOEN I
COMFORIA KAGURAZAKA DEUXCOMFORIA AZABU EASTCOMFORIA SHINJUKUEASTSIDE TOWER (Note 5)
COMFORIA ICHIGAYAYAKUOJI
COMFORIA AKIHABARA EASTCOMFORIA MITA TROISCOMFORIA SHIBAURACOMFORIA SHINJUKU
Subtotal
COMFORIA BUNKYOKASUGACOMFORIAASAKUSAMATSUGAYACOMFORIA NISHIOICOMFORIA NAKANOCOMFORIA SHIMOKITAZAWACOMFORIA NISHIKAMATA

16th Fiscal Period(from February 1, 2018 to July 31, 2018)

Ratio toRatio toTotal number
Total number Occupancy rate Rental revenue
total
total
Rental revenue(at end of period)of tenantsof tenants
rental(at end of period) (during period)(during period) rental(%)(at end of period)(at end of period)(thousands of yen) revenues(thousands of yen) revenues(%)(Note 1)
(Note 1)
(Note 2)
(Note 2)(%)(%)
Occupancy
rate

1

97.5

58,142

0.8

1

97.7

59,298

0.8

1
1
1
1
1
1
1
1
1

97.2
100.0
97.6
98.7
90.3
100.0
100.0
100.0

64,771
46,585
20,255
116,308
21,57549,00026,01639,723

0.9
0.6
0.3
1.6
0.3
0.7
0.4
0.5

1
1
1
1
1
1
1
1

97.9
98.3
92.7
97.5
100.0
97.9
95.7
95.2

66,81048,59021,634
113,665
20,21350,67826,69442,856

0.9
0.6
0.3
1.5
0.3
0.7
0.3
0.6

84.1

7,952

0.1

1

63.5

9,806

0.1

1
1

96.4

57,769

0.8

1

100.0

60,746

0.8

92.2

124,943

1.7

1

98.1

126,607

1.6

1
1

96.2

29,680

0.4

1

97.1

30,1250.4

97.5

98,174

1.3

1

96.3

97,586

1.3

1

100.0

45,662

0.6

1

97.5

45,013

0.6

1

99.0

68,695

0.9

1

98.0

67,962

0.9

1
1

100.0
97.2

28,83942,167

0.4
0.6

1
1

97.5
94.3

28,64840,446

0.4
0.5

1

100.0

36,616

0.5

1

100.0

35,615

0.5

1
1
1
1
1
1
1
1

98.3
100.0
94.6
94.7
97.0
100.0
98.5
97.4

58,65765,667
101,257
54,010134,414
48,371
67,192
56,118

0.8
0.9
1.4
0.7
1.8
0.7
0.9
0.8

1
1
1
1
1
1
1
1

98.3
97.5
97.2
97.9
96.2
100.0
97.4
92.3

59,26863,423
104,553
54,495
135,576
51,207
66,891
55,908

0.8
0.8
1.3
0.7
1.7
0.7
0.9
0.7

1

100.0

51,293

0.7

1

98.6

52,205

0.7

1
1
1
1
1
1
1
1
1
1

87.0
95.2
97.8
98.4
97.1
95.5
94.6
93.1
92.1
99.0

23,38550,00145,41342,863
63,95997,13242,96842,391
42,185
74,104

0.3
0.7
0.6
0.6
0.9
1.3
0.6
0.6
0.6
1.0

1
1
1
1
1
1
1
1
1
1

97.1
100.0
95.8
95.2
98.6
98.7
98.2
94.8
88.9
98.7

24,54051,82245,91844,183
61,425
100,385
44,88542,191
41,23474,789

0.3
0.7
0.6
0.6
0.8
1.3
0.6
0.5
0.5
1.0

1

95.4

1,454,491

19.8

1

96.4

1,513,295

19.5

1
1
1
1
–
2
1

94.3
96.8
100.0
92.8
–
96.4
99.0

24,438
117,662
23,52021,290–3,785,673
60,059

0.3
1.6
0.3
0.3
–
51.5
0.8

1
1
1
1
1
2
1

96.0
97.2
100.0
90.8
91.6
96.8
97.0

26,451
125,829
24,86924,314
10,863
3,893,537
61,093

0.3
1.6
0.3
0.3
0.1
50.1
0.8

1

97.2

44,631

0.6

1

100.0

45,494

0.6

1
1
1
1

100.0
93.9
94.2
97.5

32,72031,862
94,76564,533

0.4
0.4
1.3
0.9

1
1
1
1

100.0
95.0
97.1
97.2

32,35032,19994,922
67,524

0.4
0.4
1.2
0.9

- 15 -

Area

Property nameSub-central Tokyo

The overview of the rental business by assets under management of the Investment Corporation is as follows.

COMFORIA OYAMACOMFORIA
KIYOSUMISHIRAKAWA SOUTH
COMFORIA KOMAZAWACOMFORIA KOISHIKAWACOMFORIA SENGOKUCOMFORIA
DAIKANYAMAAOBADAICOMFORIA IKEBUKUROCOMFORIA
RYOGOKUISHIWARA
COMFORIA ASAKUSABASHI
DEUX
COMFORIA OSHIAGE
COMFORIA
HONJOAZUMABASHICOMFORIA
KIYOSUMISHIRAKAWA TROISCOMFORIAMONZENNAKACHOCOMFORIA HIMONYACOMFORIA MISYUKUCOMFORIAGAKUGEIDAIGAKUCOMFORIA HIGASHINAKANODEUXCOMFORIAHIGASHIIKEBUKURO WEST
COMFORIA RYOGOKU DEUXCOMFORIA OMORI DEUXCOMFORIA MACHIYACOMFORIA ASAKUSABASHICOMFORIA RYOGOKU SOUTH
COMFORIA TOYOSUCOMFORIA SUMIDATACHIBANACOMFORIA UENOHIROKOJI
COMFORIA
KASUGATOMISAKACOMFORIA HONKOMAGOMECOMFORIA MORISHITACOMFORIA KIBAKOENCOMFORIA MEGUROCHOJAMARUCOMFORIA NISHIMAGOMECOMFORIAHIGASHIIKEBUKURO EASTCOMFORIAHIGASHIIKEBUKUROCOMFORIA KOMABACOMFORIA KINSHICHOCOMFORIA
MINAMISUNAMACHICOMFORIAHIGASHISHINAGAWACOMFORIA MEGUROYAKUMOCOMFORIA YOGACOMFORIA
ITABASHINAKAJUKUCOMFORIA SHINAGAWA EASTCOMFORIA OJIMACOMFORIA OMORI TROIS

16th Fiscal Period(from February 1, 2018 to July 31, 2018)

Ratio toRatio toOccupancy
Occupancy
Total number
Total number
total
total
Rental revenue
Rental revenue
rate
rate
of tenantsof tenants
rentalrental(at end of period) (during period)(at end of period) (during period)(at end of period)(at end of period)(thousands of yen) revenues(thousands of yen) revenues(%)(%)(Note 1)
(Note 1)
(Note 2)
(Note 2)
(%)
(%)

1

97.0

79,052

1.1

1

95.2

78,675

1.0

1

95.6

27,298

0.4

1

95.6

28,794

0.4

1
1
1

94.6
97.5
97.8

42,80821,86054,107

0.6
0.3
0.7

1
1
1

91.9
95.0
95.1

42,415
21,26855,687

0.5
0.3
0.7

1

100.0

38,433

0.5

1

93.4

37,693

0.5

1

92.8

21,352

0.3

1

93.5

22,841

0.3

1

100.0

25,590

0.3

1

100.0

25,599

0.3

1

100.0

30,846

0.4

1

96.3

30,027

0.4

1

95.3

25,440

0.3

1

97.4

25,685

0.3

1

100.0

28,095

0.4

1

100.0

28,698

0.4

1

100.0

31,434

0.4

1

100.0

32,330

0.4

1

97.9

91,811

1.2

1

97.2

92,922

1.2

1
1

91.6
96.5

42,83963,222

0.6
0.9

1
1

95.6
98.3

42,82068,226

0.6
0.9

1

98.0

39,489

0.5

1

92.4

39,750

0.5

1

89.9

29,380

0.4

1

98.1

30,739

0.4

1

96.4

158,737

2.2

1

96.0

163,345

2.1

1
1
1
1
1
1

92.8
97.1
97.0
98.8
96.0
98.3

36,26239,60726,018102,564
48,196
103,700

0.5
0.5
0.4
1.4
0.7
1.4

1
1
1
1
1
1

100.0
94.6
90.9
98.5
97.4
97.1

35,21337,76725,586
103,463
48,640105,919

0.5
0.5
0.3
1.3
0.6
1.4

1

100.0

32,386

0.4

1

93.9

32,109

0.4

1

100.0

35,597

0.5

1

94.7

35,238

0.5

1

99.4

91,406

1.2

1

98.0

90,363

1.2

1
1
1

94.5
98.7
98.3

44,91950,27532,250

0.6
0.7
0.4

1
1
1

97.3
100.0
95.0

46,44749,40633,998

0.6
0.6
0.4

1

98.9

72,077

1.0

1

95.5

71,311

0.9

1

100.0

34,293

0.5

1

98.1

33,403

0.4

1

95.4

66,305

0.9

1

97.9

70,150

0.9

1

100.0

37,600

0.5

1

100.0

37,030

0.5

1
1

95.3
98.1

136,023
33,595

1.8
0.5

1
1

96.1
98.2

134,322
34,356

1.7
0.4

1

95.8

130,124

1.8

1

95.2

133,750

1.7

1

98.2

52,644

0.7

1

100.0

53,250

0.7

1
1

97.3
95.6

24,51331,292

0.3
0.4

1
1

97.6
94.5

26,211
31,763

0.3
0.4

1

99.0

122,141

1.7

1

98.0

124,618

1.6

1
1
1

99.0
98.0
96.0

73,97059,414
24,573

1.0
0.8
0.3

1
1
1

95.4
99.0
98.0

73,324
61,624
26,159

0.9
0.8
0.3

- 16 -

35

15th Fiscal Period(from August 1, 2017 to January 31, 2018)

Other major cities

Tokyo metropolitanarea

Sub-central Tokyo

Area(Note 1)

(Note 2)
(Note 3)(Note 4)(Note 5)36

Property name

COMFORIA BUNKYOHAKUSANCOMFORIA KAMATA
COLLEGE COURTHACHIMANYAMA
COMFORIA UENOIRIYACOMFORIA IKEJIRICOMFORIA
SETAGAYAKAMIUMACOMFORIA
AKABANEIWABUCHICOMFORIA RYOGOKU TROISCOLLEGE SQUAREHACHIMANYAMA
Subtotal
COMFORIA KOMAE (Note 3)
COMFORIA
YOKOHAMAKANNAI (Note 4)
COMFORIA ICHIKAWAMYODENCOMFORIA YATSUKACOMFORIA SHINKOYASUCOMFORIA GYOTOKU
Subtotal
COMFORIA SHIN-OSAKACOMFORIA SHINSAKAE
COMFORIA KITAHORIE
COMFORIA KITASANJOCOMFORIA SAPPOROSHOKUBUTSUENCOMFORIA OGIMACHICOMFORIA SHINSAIBASHIEASTCOMFORIA KYOMACHIBORICOMFORIA AWAZACOMFORIA KITAHAMA
Subtotal
Total

4. Statement of Renewable Energy Power Generation Facilities

16th Fiscal Period(from February 1, 2018 to July 31, 2018)

Ratio toRatio toOccupancy
Total number Occupancy rate Rental revenue
Total number
total
total
Rental revenue
rate(at end of period)oftenantsof tenants
rental(at end of period) (during period)(during period) rental(%)(at end of period)(at end of period)(thousandsofyen)(thousandsofyen)revenues
revenues(%)(Note 1)
(Note 1)
(Note 2)
(Note 2)
(%)
(%)

1

95.8

36,992

0.5

1

94.0

36,528

0.5

1

97.7

162,406

2.2

1

95.9

159,655

2.1

1

100.0

30,222

0.4

1

100.0

30,222

0.4

－

－

－

－

1

92.6

64,233

0.8

－

－

－

－

1

92.8

30,081

0.4

－

－

－

－

1

100.0

72,601

0.9

－

－

－

－

1

93.3

43,116

0.6

－

－

－

－

1

97.3

27,023

0.3

－

－

－

－

1

100.0

7,785

0.1

2

97.2

2,951,752

40.1

2

96.7

3,227,789

41.5

1

95.3

18,852

0.3－－

15,411

0.2

1

96.4

41,654

0.6－－

13,980

0.2

1

91.6

23,708

0.3

1

96.2

24,452

0.3

1

95.2

27,402

0.4

1

95.2

27,495

0.4

1

100.0

37,737

0.5

1

94.0

39,933

0.5

1

91.4

26,049

0.4

1

98.3

27,983

0.4

1

95.6

175,404

2.4

1

95.6

149,256

1.9

1

98.3

88,783

1.2

1

98.8

91,162

1.2

1

95.1

56,568

0.8

1

95.9

58,545

0.8

1

93.5

32,023

0.4

1

93.5

31,459

0.4

1

98.9

35,347

0.5

1

87.6

34,153

0.4

1

97.6

42,513

0.6

1

95.3

42,563

0.5

1

94.5

40,158

0.5

1

100.0

41,323

0.5

1

91.6

60,002

0.8

1

92.4

59,711

0.8

1

91.6

46,951

0.6

1

97.6

45,562

0.6

1

95.4

42,549

0.6

1

98.9

42,902

0.6

－

－

－

－

1

98.6

53,946

0.7

1

95.7

444,897

6.0

1

95.9

501,331

6.5

Not applicable

5. Statement of Operational License of Public Facilities
Not applicable

6. Statement of Securities Incorporated in the Portfolio
Not applicable

7. Details of Specified Transactions
The amount of specified derivative transactions entered into by the Investment Corporation and fair value as of July 31, 2018 are
as follows.
Segment
Over-the-countertransactions

Type

Contract amount (millions of yen)

Total
(Note 1)
(Note 2)

Over 1 year

(Note 1)

Receive floating, pay
fixed interest-rate swap
transactions

Fair value(millions of yen)
(Note 2)

48,74541,245–48,74541,245–The contract amount of the interest-rate swap transactions is based on the notional principal.
The fair value was calculated by the counterparty of the relevant transaction based on the actual market interest rate. The fair value is omitted fortransactions that meet the requirements for special treatment pursuant to the Accounting Standard for Financial Instruments.

8. Other Assets
Trust beneficial interests in properties owned by the Investment Corporation are listed on the aforementioned “3. Statement of
Properties Incorporated in the Portfolio.” As of the end of the 16th Fiscal Period, there is no incorporation in particular of specified
assets as principal investment targets by the Investment Corporation, other than assets in the aforementioned “3. Statement of
Properties Incorporated in the Portfolio,” “4. Statement of Renewable Energy Power Generation Facilities,” “5. Statement of
Operational License of Public Facilities” and “6. Statement of Securities Incorporated in the Portfolio.”

9. Ownership of Assets by Country and Region
Not applicable for countries and regions other than Japan.

396.7
7,357,728
100.0
3
96.6
7,771,914
100.0“Total number of tenants” indicates the total number of tenants under a direct lease relationship with the Investment Corporation or the trustee (including
tenants planned to have lease relationships). Therefore, in cases where the Investment Corporation or trustee comprehensively leases all of the apartments
for rent from each managed property to the master lease company (hereinafter referred to as the “introduction of a master lease”), and said master lease
company subleases each room for rent to end tenants, the total number of tenants will be shown as “1,” and will not include the number of end tenants
related to the said sublease. Tokyu Housing Lease Corporation, Mitsubishi Real Estate Services Co., Ltd. and MAINICHICOMNET Co., Ltd. are thethree master lease companies hired by the Investment Corporation for its assets under management; therefore, the sum of the total number of tenants
and subtotal of the total number of tenants in Central Tokyo is set as “3.” Even for managed assets where a master lease is introduced, end tenants who
do not accept the introduction of a master lease will be under a direct lease relationship with the Investment Corporation or trustee. However, the numberof said end tenants is not included in the total number of tenants.
“Occupancy rate” is the percentage of rented area vs. the rentable area of each managed asset.
This property was sold to a third party as of June 20, 2018.
This property was sold to a third party as of March 30, 2018.
The master lease company has been changed from Mitsubishi Real Estate Services Co., Ltd. to Tokyu Housing Lease Corporation as of August 1, 2018.

- 17 -- 18 -

37

Capital Expenditure for Properties Owned

Status of Expenses and Liabilities

1. Expected Capital Expenditure

1. Statement of Expenses Related to Investments

Major capital expenditure that accompanies repair work currently planned for assets already acquired (includes assets undermanagement that were acquired after the account closing date) is as follows. The following expected amount of construction work
includes portions that are separately accounted for under expenses.
Property name(location)
COMFORIA
AKABANEIWABUCHI(Kita-ku, Tokyo)
COMFORIA
MINAMISUNAMACHI(Koto-ku, Tokyo)

PurposeScheduled period

Expected amount of construction work
(thousands of yen)for
Total amount
Total amount Payment
the period
already paid

Asset management fee (Note)

16th Fiscal Period
From Feb. 1, 2018 to Jul. 31, 2018

433,472

436,079

Asset custody fee

7,309

7,336

Administrative service fees

26,27527,843

Directors’ compensation

3,600

3,600

221,735

223,700

692,392

698,560

Subdivision work

From Aug. 2018
to Jul. 2019

148,000－－

Large-scale repair work

From Apr. 2018
to Nov. 2018

110,000－－

COMFORIA NAKANO(Nakano-ku, Tokyo)

Large-scale repair work

From Feb. 2019
to Jul. 2019

(Note) In addition to the amount stated above, asset management fees came to ¥10,656 thousand and ¥111,035 thousand in the 15th Fiscal Period and 16th
Fiscal Period, respectively, related to the acquisition of property and ¥18,050 thousand in the 16th Fiscal Period related to the sale of property areincorporated in the book value of each property．

53,000－－2. Loan Status

COMFORIA SHIBAURACANAL(Minato-ku, Tokyo)

Large-scale repair work

From Aug. 2018
to Dec. 2018

51,000－－

COMFORIA SHIBAKOEN(Minato-ku, Tokyo)

Large-scale repair work－

Other properties, etc.

From Feb. 2018
to Jul. 2018
From Feb. 2018
to Jul. 2018
From Feb. 2018
to Jul. 2018
From Feb. 2018
to Jun. 2018
From Apr. 2018
to Jun. 2018
From Feb. 2018
to Jul. 2018

Large-scale repair work
Large-scale repair work
Large-scale repair work
Large-scale repair work
Renovation of common areas
Replacement of air conditioners, etc.

Total

64,941
48,89237,05427,034
7,214
96,020281,158

3. Funding Reserved for Long-Term Repair Plans
From the cash flows during the fiscal period, the Investment Corporation sets aside reserves for repairs, which are to beappropriated for repairs in the medium to long term.
(Thousands of yen)
Fiscal period
Balance of reserves at the
beginning of period
Amount of reserves
during period
Reversal of reserves
during period
Amount carried forward
to next period

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

15th Fiscal Period

16th Fiscal Period

From Feb. 1, 2016
to Jul. 31, 2016

From Aug. 1, 2016
to Jan. 31, 2017

From Feb. 1, 2017
to Jul. 31, 2017

From Aug. 1, 2017
to Jan. 31, 2018

From Feb. 1, 2018
to Jul. 31, 2018

327,081

378,887

377,947

349,367

328,884

232,577

304,044

311,155

523,929508,774

180,771304,984

339,736

544,411

480,415

378,887

377,947

349,367

328,884

357,243- 19 -

Drawdown beginning ofcurrent perioddate

Balance at theend of current
period(millions of yen) (millions of yen)

Construction cost(thousands of yen)

PeriodLender－Short-term
loans

49,000PurposeBalance at theType

Long-term loans (Note 1)

From Feb. 2019
to Jul. 2019

The status of loans as of July 31, 2018 is as follows.

The overview of main construction work corresponding to capital expenditure that took place in the 16th Fiscal Period for the
managed assets owned as of the end of the period is as follows. Capital expenditure during the 16th Fiscal Period was ¥281,158
thousand. Together with repair expenses of ¥277,912 thousand that were classified as expenses for the 16th Fiscal Period,
construction work totaling ¥559,070 thousand was carried out.
Property name(location)
COMFORIA NISHISHINJUKU(Shinjuku-ku, Tokyo)
COMFORIA UENOHIROKOJI(Taito-ku, Tokyo)
COMFORIA HIGASHIIKEBUKURO(Toshima-ku, Tokyo)
COMFORIA MEGUROYAKUMO(Meguro-ku, Tokyo)
COMFORIA GYOTOKU(Ichikawa-shi, Chiba)

Other expenses
Total

2. Capital Expenditure during the Period

38

Item

(Thousands of yen)

15th Fiscal Period
From Aug. 1, 2017 to Jan. 31, 2018

MUFG Bank, Ltd.
(Note 4) (Note 5)
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.
(Note 4) (Note 5)
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 5)
MUFG Bank, Ltd.
(Note 4) (Note 5)
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Development Bank of Japan Inc.
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation

500
Aug. 1,
2017

Mar. 23,2011
Sep. 4,2013
Sep. 30,
2013
Sep. 30,
2013

Feb. 4,2014

Feb. 4,2014

Jun. 30,
2014

Averageinterest Maturity Repayment Use ofdatemethodfunds
rate (%)– 0.25545

250
250
130
3,570
3,570

–
–
–
3,570
3,570

3,570

3,570 0.55450

1,785

1,785 0.55450

2,000

2,000 0.79500

2,700– 0.67075

1,350
600

– 0.67075– 0.67075

1,350

1,350 0.90487

2,000

2,000 0.60700

1,000
1,000
1,000
500

1,000
1,000
1,000
500

2,000

2,000 0.88240

1,000
1,000
1,000
500

1,000
1,000
1,000
500

1,340

1,340 0.60150

670
670
670
350

- 20 -

Remarks(Note 2)

670
670
670
350

0.255450.255450.255450.55450
0.55450

Jul. 31,2018

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

Mar. 23,
2019

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

UnsecuredAug. 31, Lump-sum(Note 3)2018
repayment
Unguaranteed
Mar. 30,
2018

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

Sep. 30,
2019

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

0.60700 Jan. 31,
0.60700 2019
0.60700
0.60700

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

0.88240 Jan. 31,
0.88240 2021
0.882400.882400.60150 Jun. 30,
0.60150 2020
0.601500.60150

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

39

40

LenderLong-term loans (Note 1)

MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Shinkin Central Bank
The Norinchukin Bank
The Bank of Fukuoka, Ltd.
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Development Bank of Japan Inc.
MUFG Bank, Ltd.
(Note 5)
Kiraboshi Bank, Ltd. (Note 6)
Sumitomo Mitsui Trust Bank, Limited

Drawdown
dateJun. 30,
2014

Feb. 3,2015

Feb. 3,2015

Feb. 3,2015

Feb. 3,2015

Feb. 2,
2016

Feb. 2,
2016

Feb. 2,
2016

Mar. 23,2016

Balance at theBalance at theend of current
period

1,820

1,820

910
910
910
450
750
750
750

910
910
910
450
–
–
–

1,200

1,200

600
600
600
300

600
600
600
300

1,240

1,240

620
620
620
310

620
620
620
310

1,240

1,240

620
620
620
310

620
620
620
310

1.04200 Jan. 31,
1.04200 2025
1.04200
1.04200

720

720

0.58430

360
360
360
200

360
360
360
200

0.58430 Mar. 31, Lump-sum
Unsecured(Note 3)0.58430 2023
repayment
Unguaranteed
0.58430
0.58430840

840

0.62460

420
420
420
230

420
420
420
230

0.62460 Aug. 31, Lump-sum
Unsecured(Note 3)0.62460 2023
repayment
Unguaranteed
0.62460
0.62460

980

980

0.67745

490
490
490
220
1,570

490
490
490
220
1,570

0.67745 Feb. 29,
0.67745 2024
0.677450.677450.27125

1,570

1,570

1,000
785

1,000
785

0.27125 Mar. 31, Lump-sum
Unsecured(Note 3)2021
repayment
Unguaranteed
0.27125
0.27125(millions of yen) (millions of yen)- 21 -

Remarks

Type(Note 2)0.90100
0.90100 Jun. 30, Lump-sum
Unsecured(Note 3)0.90100 2022
repayment
Unguaranteed
0.90100
0.90100
0.30820
Mar. 30, Lump-sum
Unsecured(Note 3)0.308202018
repayment
Unguaranteed
0.308200.69250
0.69250 Jan. 31,
0.69250 2022
0.69250
0.69250

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

0.79875
0.79875 Jan. 31,
0.79875 2023
0.79875
0.79875

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

1.04200
Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

LenderDevelopment Bank of Japan Inc.
MUFG Bank, Ltd.
(Note 5)
Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Mizuho Trust & Banking, Co., Ltd.
The Norinchukin Bank
The Bank of Fukuoka, Ltd.
The 77 Bank, Ltd.
The Daishi Bank, Ltd.
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Sumitomo Mitsui Trust Bank, Limited
MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.
Mizuho Bank, Ltd.
Sumitomo Mitsui Trust Bank, Limited
Sumitomo Mitsui Banking Corporation
Shinkin Central Bank
The Norinchukin Bank
The Bank of Fukuoka, Ltd.
Mizuho Trust & Banking, Co., Ltd.
MUFG Bank, Ltd.
(Note 4) (Note 5)
Mizuho Bank, Ltd.
Sumitomo Mitsui Banking Corporation
Total

Averageinterest Maturity Repayment Use ofdatemethodfunds
rate (%)

Drawdown beginning ofcurrent perioddate

Balance at theend of current
period

2,000

2,000

0.61950

2,000

2,000

0.61950

1,000

1,000

0.61950

1,160

1,160

0.46655

580
580
580
290

580
580
580
290

1,800

1,800

0.65518

900
900
900
450
2,000
1,500
1,000
500
500

900
900
900
450
2,000
1,500
1,000
500
500

0.65518 Jul. 31, Lump-sum
Unsecured(Note 3)
Unguaranteed
0.65518 2026
repayment
0.655180.65518
0.46691
0.46691
Jan. 31, Lump-sum
Unsecured(Note 3)0.466912022
repayment
Unguaranteed
0.46691
0.46691

1,160

1,160

0.62938

580
580
580
290

580
580
580
290

1,820

1,820

910
910
910
450

910
910
910
450

1,140

1,140

570
570
570
300

570
570
570
300

1,140

1,140

570
570
570
300

570
570
570
300

–

100

–

1,040

0.65428

–
–
–
–
–
–
–
–

520
520
520
260
1,300
1,300
1,300
1,000

0.65428 Jan. 31, Lump-sum
Unsecured(Note 3)0.65428 2025
repayment
Unguaranteed
0.654280.654280.45804
0.45804 Mar. 31, Lump-sum
Unsecured(Note 3)2023 repayment
Unguaranteed
0.45804–2,700

0.62188––
98,7501,350
600
103,230

0.62188
0.62188(millions of yen) (millions of yen)

Long-term loans (Note 1)

Type

Averageinterest Maturity Repayment Use ofdatemethodfunds
rate (%)

Balance at the
beginning ofcurrent period

Mar. 23,
2016

Aug. 1,
2016

Aug. 1,
2016

Jan. 31,2017

Feb. 2,2017Feb. 2,2017

Sep. 29,2017

Sep. 29,2017

Feb. 2,
2018

Feb. 2,
2018

Mar. 30,
2018

Mar. 30,2018- 22 -

Remarks(Note 2)Mar. 31, Lump-sum
Unsecured(Note 3)2025
repayment
Unguaranteed

0.46655 Jul. 31,
0.46655 2024
0.46655
0.46655

UnsecuredLump-sum(Note 3)
Unguaranteed
repayment

0.62938 Jan. 31, Lump-sum
Unsecured(Note 3)
Unguaranteed
0.62938 2024
repayment
0.62938
0.62938
0.79571
0.79571 Jan. 30, Lump-sum
Unsecured(Note 3)
Unguaranteed
0.79571 2026
repayment
0.79571
0.795710.490540.49054 Sep. 30, Lump-sum
Unsecured(Note 3)
Unguaranteed
0.49054 2022
repayment
0.490540.490540.77571
0.77571 Sep. 30,
0.77571 2026
0.77571
0.77571
Feb. 28,0.253762019

UnsecuredLump-sum(Note 3)
Unguaranteed
repayment

Lump-sum
Unsecured(Note 3)
repayment
Unguaranteed

0.45804
Mar. 31, Lump-sum
Unsecured(Note 3)2025 repayment
Unguaranteed

41

(Note 1)(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)Long-term loans include the current portion of long-term loans payable.
Average interest rates consist of the borrowing rates for each loan agreement rounded to the fifth decimal place. Furthermore, the stated rate for loans
for which interest-rate swap transactions were carried out to avoid interest rate risk takes into account the effect of the interest-rate swap.
The use of funds includes purchasing properties in trust and the repayment of existing borrowings.
The Bank of Tokyo-Mitsubishi UFJ, Ltd. changed its name to MUFG Bank, Ltd. as of April 1, 2018.
Mitsubishi UFJ Trust and Banking Corporation transferred its corporate lending operations to MUFG Bank, Ltd. on April 16, 2018.
The Tokyo Tomin Bank, Ltd. merged with The Yachiyo Bank, Ltd. and ShinGinko Tokyo, Ltd. on May 1, 2018, and was renamed Kiraboshi Bank, Ltd.

3. Investment Corporation Bonds
The status of investment corporation bonds as of July 31, 2018 is as follows.
Issue

Issue
date

Balance at theAmountAmountBalance at the
beginning ofincreased indecreased in
end of current
current period
current period
current period
period(millions of yen) (millions of yen) (millions of yen) (millions of yen)

CouponMaturity Repayment Use of
rate
date
method funds(%)

Security

1st Unsecured Bond Jul. 30,(Note 1)
2014

3,000

－

－

3,000 0.64000

Jul. 30, Lump-sum(Note 2) Unsecured
2021
repayment

2nd Unsecured Bond Jul. 18,(Note 1)
2017

1,000

－

－

1,000 0.23000

Jul. 15, Lump-sum(Note 2) Unsecured
2022
repayment

3rd Unsecured Bond Jul. 18,(Note 1)
2017

2,000

－

－

2,000 0.52000

Jul. 16, Lump-sum(Note 2) Unsecured
2027
repayment

4th Unsecured Bond

Jun. 14,
2018

－

1,000

－

1,000 0.23000

Dec. 14, Lump-sum(Note 2) Unsecured
2023
repayment

5th Unsecured Bond

Jun. 14,
2018

－

1,500

－

1,500 0.95000

Jun. 14, Lump-sum(Note 2) Unsecured
2033
repayment

6,000

2,500

－

8,500

(Note 1)
(Note 1)

Total
(Note 1)
(Note 2)The bonds are subject to the pari passu clause among specified investment corporation bonds.
The funds are appropriated to the acquisition of real estate in trust and the repayment of some of the existing borrowings.

4. Short-Term Investment Corporation Bonds
Not applicable

5. Investment Unit Acquisition Rights
Not applicable42- 23 -- 24 -

43

Purchase and Sale during the Period(Note 1) The acquisition price and sale price do not include miscellaneous expenses required for the acquisition or sale of said property, fixed property
tax, city planning tax, consumption tax and local consumption tax.
(Note 2) Appraisal value indicates appraisal value or investigated value.
(Note 3) The real estate appraisers handling the real estate appraisal or research reports of each property are: (1) Japan Real Estate Institute; (2) JLL
Morii Valuation & Advisory K.K.; (3) The Tanizawa Sōgō Appraisal Co., Ltd.; and (4) Daiwa Real Estate Appraisal Co., Ltd.

1. Purchase and Sale of Properties and Asset Backed Securities
Acquisition
Property name

Sale

Acquisitiondate

Acquisition price(millions of yen)

COMFORIA
UENOIRIYA

Feb. 2, 2018

2,173

–

–

–

–

COMFORIA IKEJIRI

Feb. 2, 2018

1,313

–

–

–

–

COMFORIA
SETAGAYAKAMIUMA

Feb. 2, 2018

2,622

–

–

–

–

COMFORIA
KITAHAMA

Feb. 2, 2018

1,719

–

–

–

–

COMFORIA
AKABANEIWABUCHI

Mar. 30, 2018

2,500

–

–

–

–

COMFORIA RYOGOKU
TROISMar. 30, 2018

1,660

–

–

–

–

COMFORIA SHINJUKUMar. 30, 2018

2,150

–

–

–

–

COLLEGE SQUAREHACHIMANYAMA

May 25, 2018

880

–

–

–

–

COMFORIA
YOKOHAMAKANNAI––Mar. 30,
2018

1,200

927

218

COMFORIA KOMAE––

Jun. 20,
2018

605

419

156

–

15,017

–

1,805

1,347

375

Total

Sale date

Sale priceBook value
Gain on sale(millions of yen) (millions of yen) (millions of yen)

(2) Other
Of the transactions carried out by the Investment Corporation, there were no other transactions than those shown in the
aforementioned “(1) Real estate, etc.” that were deemed to require an appraisal pursuant to the provisions of Article 201 of theInvestment Trust Act.

(Note) The acquisition price and sale price do not include miscellaneous expenses required for the acquisition or sale of said property, fixed property tax, city
planning tax, consumption tax and local consumption tax.

2. Purchase and Sale of Other Assets
Main assets other than the above properties and asset backed securities are bank deposits or bank deposits within trust assets.

3. Appraisals of Specified Assets(1) Real estate, etc.
Acquisitionor saleAcquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Acquisition
Sale
Sale

44

Type of asset
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Real estate
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust
Beneficial
interest in realestate trust

Real estate appraisal
Acquisition priceor sale priceAppraisal value Appraisal
Date of(millions of yen)(millions ofcompany
valuation(Note 1)
(Note 3)yen) (Note 2)

Property nameAcquisition orsale date

COMFORIA UENOIRIYA

Feb. 2, 2018

2,173

2,220

(4)

Oct. 31, 2017

COMFORIA IKEJIRI

Feb. 2, 2018

1,313

1,400

(1)

Oct. 31, 2017

COMFORIA
SETAGAYAKAMIUMA

Feb. 2, 2018

2,622

2,650

(3)

Oct. 31, 2017

COMFORIA KITAHAMA

Feb. 2, 2018

1,719

1,760

(2)

Oct. 31, 2017

COMFORIA
AKABANEIWABUCHI

Mar. 30, 2018

2,500

2,520

(1)

Feb. 28, 2018

COMFORIA RYOGOKU
TROISMar. 30, 2018

1,660

1,680

(1)

Feb. 28, 2018

COMFORIA SHINJUKUMar. 30, 2018

2,150

2,300

(4)

Feb. 28, 2018

COLLEGE SQUAREHACHIMANYAMA

May 25, 2018

880

890

(3)

Apr. 30, 2018

COMFORIA
YOKOHAMAKANNAIMar. 30, 2018

1,200

1,270

(1)

Jan. 31, 2018

COMFORIA KOMAE

Jun. 20, 2018

605

559

(1)

Jan. 31, 2018- 25 -- 26 -

45

Accounting Status

4. Transactions with Related Parties(1) Information on transaction

1. Assets, Liabilities, Principal and Profit/Loss

Purchase and sales amount

Category

Purchase amount

Total amount

Please refer to “1. Balance Sheets,” “2. Statements of Income,” “3. Statements of Changes in Unitholders’ Equity,” “4. Statementsof Cash Distributions,” “5. Statements of Cash Flows,” and “6. Notes.”

Sales amount    ¥15,017,000 thousand¥1,805,000 thousand  

2. Changes in the Calculation Method of Depreciation

Breakdown of transactions between related parties
Tokyu Land Corporation
Total

Not applicable¥7,827,000 thousand (52.1%)¥－ thousand (－%)

¥7,827,000 thousand (52.1%)¥－ thousand (－%)

(Note) The term “Related parties” refers to related parties defined in Article 123 of the Order for Enforcement of the Act on Investment Trusts and Investment
Corporations as well as related parties of the Investment Corporation prescribed in Article 26, Paragraph 1, Item 27 of the Regulations Concerning
Investment Reports of Investment Trusts and Investment Corporations issued by the Investment Trusts Association, Japan. Descriptions are included
with regard to related parties that fall under any of these and that had transactions or paid commissions, etc. during the 16th Fiscal Period. (The same
shall apply in “(2) Amount of commission paid” and “(3) Major payments to other related parties” below.)(2) Amount of commission paid
Category

Property management
entrustment costs

3. Changes in the Appraisal Method of Real Estate, etc.
Not applicable

Other
1. Beneficiary Certificates of Investment Trusts Established by the Investment Corporation
Not applicable

Total amount ofcommission paid(A)
(thousands of yen)

684,012

Breakdown of transaction with related parties
Payee

Amount of payment(B)(thousands of yen)

Percentage of total
amount (B/A)(%)

Tokyu Housing Lease Corporation

397,039

58.0

Community One Co., Ltd.

18,655

2.7

TS Community Co., Ltd. (Note 2)

8,654

1.3

Tokyu Community Corp.

4,515

0.7

892

0.5

9,974

6.1

2,485

1.5

Marketing-related
expenses

196,721 Tokyu Livable, Inc.

Other expenses related
to rent business

163,768 Tokyu Redesign Corporation
Community One Co., Ltd.

1,290

0.8

Warehousing expenses(Note 1)45,905 Tokyu Land Corporation

45,905100.0Tokyu Sports Oasis, Inc.

(Note 1) “Warehousing expenses” are expenses other than the acquisition price such as due diligence expenses and brokerage fees that are determined by
the Investment Corporation upon agreement with Tokyu Land Corporation for the purchase of the property in question.
(Note 2) TS Community Co., Ltd. was absorbed by Community One Co., Ltd. in an absorption-type merger as of April 1, 2018.

(3) Major payments to other related parties
Tokyu Redesign Corporation¥28,673 thousand (repair work, etc.)
Tokyu Livable, Inc.
¥18,150 thousand (brokerage fees)
Ewel Inc.
¥2,548 thousand (system usage, etc.)
Tokyu Community Corp.
¥1,039 thousand (repair work)

2. Notices(1) Unitholders’ Meeting
The 5th Unitholders’ Meeting of the Investment Corporation was held on April 24, 2018. The overview of matters approved at theUnitholders’ Meeting are as follows.
Proposal
Proposal 1: Changes to Part of the Articles of Incorporation
Proposal 2: Appointment of One (1) Executive Director
Proposal 3: Appointment of One (1) Alternate Executive
Director
Proposal 4: Appointment of Two (2) Supervisory Directors
Proposal 5: Appointment of One (1) Alternate Supervisory
Director(2) Board of Directors of the Investment Corporation
The main overviews of the major conclusion and change of contracts that were approved by the Board of Directors of the Investment
Corporation during current period are as follows.
Approval date

April 27, 2018

5. Transactions with Asset Management Company related to Concurrent Operations Carried Out by the AssetManagement Company
The Asset Management Company is not concurrently engaged in type I financial instruments business, type II financial instruments
business, realty business or specified real estate cooperative business.

Overview
Unnecessary supplementary provisions were deleted (related
to Article 42 of the Articles of Incorporation).
Takehiro Izawa was appointed Executive Director.
Kentaro Yoshikawa was appointed Alternate Executive
Director.
Yoshihiro Kataoka and Koji Yamamoto were appointed
Supervisory Directors.
Masamichi Oshima was appointed Alternate Supervisory
Director.

MatterOverview

A comprehensive resolution for the issuance of investment corporation
bonds with an aggregate maximum amount of issuance of ¥25 billion
Comprehensive resolution for issuance and a period of issuance from May 9, 2018 to May 8, 2019 wasof investment corporation bonds and resolved. To entrust the administrative duties concerned in offering
entrustment of general administrative investment corporation bonds and general administrative duties,
dutiesincluding issuing, financial and paying agent, a candidate company wasapproved and other necessary matters to be decided were left to thediscretion of the Executive Director.

3. Disclosure on Overseas Property-Owning Corporations
Not applicable

4. Disclosure on Real Estate Owned by Overseas Property-Owning Corporations
Not applicable

5. Other
Figures in this document are rounded down (values) and rounded to the nearest decimal place (percentages) unlessotherwise indicated.

46- 27 -- 28 -

47

III Financial Section
III. Financial Section(Thousands of yen)

1. Balance Sheets

15th Fiscal Period(As of January 31, 2018)(Thousands of yen)
15th Fiscal Period(As of January 31, 2018)
AssetsCurrent assets
Cash and deposits
Cash and deposits in trust
Operating accounts receivable
Prepaid expenses
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net
Structures
Accumulated depreciation
Structures, net
Machinery and equipment
Accumulated depreciation
Machinery and equipment, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
Land
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
Land in trust
Total property, plant and equipment
Intangible assets
Leasehold rights in trust
Other
Total intangible assets
Investments and other assets
Lease and guarantee deposits
Long-term prepaid expenses
Total investments and other assets
Total non-current assets
Deferred assets
Investment unit issuance expenses
Investment corporation bond issuance costs
Total deferred assets
Total assets

16th Fiscal Period(As of July 31, 2018)

7,558,727
6,485,103
5,583
362,231460
14,412,107

6,673,896
6,814,124
6,296
389,506845
13,884,670

2,102,140(111,718)
1,990,421
23,641(3,146)
20,495
17,687(913)
16,773
2,505
(381)
2,123
3,340,008
88,659,442(8,520,430)
80,139,011
1,147,865(257,757)
890,107
1,557,509(226,048)
1,331,461
247,203(70,450)
176,752
100,224,324
188,131,480

2,546,503(139,824)
2,406,679
28,301(4,013)24,288
17,687(1,188)16,499
3,062
(623)
2,438
4,674,303
92,110,382(9,484,725)
82,625,656
1,183,712(285,120)
898,592
1,557,003(248,426)
1,308,576
291,661(88,080)
203,581
109,498,297
201,658,914

1,192,006
13,2491,205,256

1,183,441
11,7391,195,181

1,507,223
844,322
2,351,545
191,688,282

1,525,188
858,156
2,383,344
205,237,439

39,59431,32770,922
206,171,312

39,42649,48088,907219,211,018

Liabilities
Current liabilities
Operating accounts payable
Short-term loans payable
Current portion of long-term loans payable
Accounts payable－otherAccrued expenses
Income taxes payable
Accrued consumption taxes
Advances received
Other
Total current liabilities
Non-current liabilities
Investment corporation bonds
Long-term loans payable
Tenant leasehold and security deposits
Tenant leasehold and security deposits in trust
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Unitholders' equity
Unitholders' capital
Surplus
Voluntary retained earnings
Reserve for reduction entry
Total voluntary retained earnings
Unappropriated retained earnings(undisposed loss)
Total surplus
Total unitholders' equity
Total net assets
Total liabilities and net assets

16th Fiscal Period(As of July 31, 2018)574,283
1,130,000
14,400,000
28,185
145,374
6,038
21,405
1,177,208
1,983
17,484,478

657,356－
20,095,000
63,919157,188
8,741
12,063
1,241,403
2,201
22,237,872

6,000,000
83,220,000
24,6592,051,681
95,775388
91,392,504
108,876,983

8,500,000
83,135,000
32,7402,160,708
96,372
4,973
93,929,794
116,167,666

94,557,898

99,814,378

61,846
61,84637,27737,2772,674,584

3,191,695

2,736,430
97,294,329*1 97,294,329
206,171,312

3,228,972
103,043,351*1 103,043,351
219,211,018- 28 48- 29 -

49

3. Statements of Changes in Unitholders’ Equity

2. Statements of Income(Thousands of yen)
15th Fiscal Period(From August 1, 2017
to January 31, 2018)
Operating revenue
Lease business revenue
Other lease business revenue
Gain on sales of real estate properties
Total operating revenue
Operating expenses
Expenses related to rent business
Asset management fee
Directors' compensations
Audit fee
Asset custody fee
Administrative service fees
Other operating expenses
Total operating expenses
Operating profit
Non-operating income
Interest income
Gain on forfeiture of unclaimed dividends
Reimbursement of property tax
Other
Total non-operating income
Non-operating expenses
Interest expenses
Borrowing related expenses
Interest expenses on investment corporation bonds
Amortization of investment corporation bondissuance costs
Amortization of investment unit issuance expenses
Other
Total non-operating expenses
Ordinary profit
Profit before income taxes
Income taxes－current
Income taxes－deferred
Total income taxes
ProfitRetained earnings brought forward
Unappropriated retained earnings (undisposed loss)*1 7,103,412*1 254,315

Surplus*1 3,496,351*1 3,745,525

Total net assets

Total surplus

2,608,344

2,700,515

97,258,413

97,258,413

30,323－－－

Dividends of surplus(2,638,651)(2,638,651)(2,638,651)(2,638,651)

Profit

2,674,567

2,674,567

2,674,567

2,674,567

8,147,490

436,079
3,600
13,842
7,336
27,843
209,858
4,444,086
3,703,404

60
1,292
678
62
2,094

65
797
－
－
863

326,980
128,011
15,958

328,912
135,666
18,112

3,002

3,385

16,89419
490,8672,680,212
2,680,212
6,047
(402)
5,645
2,674,567
17
2,674,584

13,589－499,666
3,204,601
3,204,601
8,751
4,341
13,092
3,191,509
186
3,191,695

Balance at beginning ofcurrent period

Reversal of reserve for
reduction entry

Total changes of items
during period
Balance at end of current
period92,170(30,323)

Total
voluntary
retainedearnings

92,170(30,323)－(30,323)(30,323)

66,23935,91535,91535,915*1 94,557,898

61,846

61,846

2,674,584

2,736,430

97,294,329

97,294,329

16th Fiscal Period (From February 1, 2018 to July 31, 2018)(Thousands of yen)

Unitholders' equity
Surplus
Unitholders'
capitalBalance at beginning ofcurrent period

94,557,898

Voluntary retained
earnings
Reserveforreduction
entry

Total
voluntary
retainedearnings

61,846

61,846

Unappropriatedretainedearnings(undisposed
loss)
2,674,584

Total net assets

Total surplus

Totalunitholders'equity2,736,430

97,294,329

97,294,329

5,256,480

5,256,480

Changes of items during
periodIssuance of new
investment units

5,256,480

Reversal of reserve for
reduction entry

24,568－－－Dividends of surplus(2,698,966)(2,698,966)(2,698,966)(2,698,966)

Profit3,191,509

3,191,509

3,191,509

3,191,509

Balance at end of current
period- 30 -

94,557,898

Unappropriatedretainedearnings(undisposed
loss)

Reserveforreduction
entry

Changes of items during
periodTotal changes of items
during period

50

Voluntary retained
earnings

Total
unitholders'equityUnitholders'
capital*1 354,240*2 375,576(Thousands of yen)

Unitholders' equity*1 7,417,674－
7,357,728

433,472
3,600
13,842
7,309
26,275
207,893
4,188,744
3,168,984

15th Fiscal Period (From August 1, 2017 to January 31, 2018)

16th Fiscal Period(From February 1, 2018
to July 31, 2018)(24,568)(24,568)

5,256,480(24,568)(24,568)

517,111492,542

5,749,022

5,749,022*1 99,814,378

37,27737,277

3,191,695

3,228,972

103,043,351

103,043,351- 31 -

51

4. Statements of Cash Distributions
Category

I. Unappropriated retained earnings
II. Reversal of Voluntary retained
earnings
Reversal of reserve for reduction
entryIII. Distributions

5. Statements of Cash Flows
15th Fiscal Period(From August 1, 2017
to January 31, 2018)

16th Fiscal Period(From February 1, 2018
to July 31, 2018)¥2,674,584,344¥3,191,695,429¥24,568,879¥19,800,000¥2,698,966,872¥2,926,165,090[¥4,788][¥4,985]¥–¥285,330,339[Distribution per unit]
IV. Voluntary retained earnings
Provision of reserve for reduction
entry
V. Retained earnings carried forward
Method for calculating distributions

52¥186,351
The Investment Corporation will makecash distributions using accounting
profits up to the amount of total surplus
based on the distribution policy outlined
in Article 35-1 of the Investment
Corporation’s Articles of Incorporation,in an amount that exceeds 90% of the“amount of distributable profit” of theInvestment Corporation as set forth in
Article 67-15 of the Act on Special
Measures Concerning Taxation.
Based on this policy, the Investment
Corporation has determined to pay out¥2,698,966,872 as the total amount ofdividends for the period under review,which is nearly equivalent to the entire
amount of unappropriated retained
earnings after adding reversal of reserve
for reduction entry.
Furthermore,theInvestment
Corporation does not pay out dividends
that exceed accounting profits asoutlined in Article 35-2 of theInvestment Corporation’s Articles ofIncorporation.

- 32 -¥0
The Investment Corporation will makecash distributions using accounting
profits up to the amount of total surplus
based on the distribution policy outlined
in Article 35-1 of the Investment
Corporation’s Articles of Incorporation,in an amount that exceeds 90% of the“amount of distributable profit” of theInvestment Corporation as set forth in
Article 67-15 of the Act on Special
Measures Concerning Taxation.
Based on this policy, the Investment
Corporation has determined to pay out¥2,926,165,090 as the total amount ofdividends for the period under review,which is equivalent to the entire amountof unappropriated retained earnings after
adding reversal of reserve for reduction
entry and deducting the provision ofreserve for reduction entry pursuant to
Article 66-2 of the Act on Special
Measures Concerning Taxation.
Furthermore,theInvestment
Corporation does not pay out dividends
that exceed accounting profits asoutlined in Article 35-2 of theInvestment Corporation’s Articles ofIncorporation.

(Thousands of yen)
16th Fiscal Period(From February 1, 2018
to July 31, 2018)

15th Fiscal Period(From August 1, 2017
to January 31, 2018)
Cash flows from operating activities
Profit before income taxes
Depreciation
Borrowing related expenses
Amortization of investment corporation bond issuance costs
Amortization of investment unit issuance expenses
Interest income
Gain on forfeiture of unclaimed dividends
Interest expenses
Decrease (increase) in operating accounts receivable
Decrease (increase) in prepaid expenses
Decrease (increase) in consumption taxes refund receivable
Increase (decrease) in accrued consumption taxes
Increase (decrease) in operating accounts payable
Increase (decrease) in accounts payable－other
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Decrease (increase) in long-term prepaid expenses
Decrease due to 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
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of property, plant and equipment in trust
Purchase of intangible assets
Payments for lease and guarantee deposits
Proceeds from tenant leasehold and security deposits
Repayments of tenant leasehold and security deposits
Proceeds from tenant leasehold and security deposits in trust
Repayments of tenant leasehold and security deposits in trust
Net cash provided by (used in) investing activities
Cash flows from financing activities
Increase in short-term loans payable
Decrease in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Proceeds from issuance of investment corporation bonds
Payments for investment corporation bond issuance costs
Proceeds from issuance of investment units
Dividends paid
Other, net
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- 33 -

2,680,212
1,155,394
128,011
3,002
16,894(60)(1,292)342,938
2,085
25,686
17,604
21,405(54,526)(5,542)
3,243
15,0576,167

3,204,601
1,203,424
135,666
3,385
13,589(65)(797)
347,025(712)(23,060)－(9,341)
91,6262,318
6,582
64,194
4,598－

1,347,161(10,154)
4,346,12760(342,930)(5,897)
3,997,359(495)
6,389,702
65(344,862)(6,048)6,038,856(1,142,038)(358,268)
(360)
－
3,890
(1,782)
203,508(219,531)(1,514,583)(1,774,048)(14,265,028)(358)(17,965)
10,621(2,311)
359,620(244,613)(15,934,084)

1,130,000－
6,200,192(6,300,000)－(3,210)－(2,637,568)(8,359)(1,618,947)
863,829
13,180,002*1 14,043,831－(1,130,000)
15,153,173(9,690,000)
2,479,210－
5,233,574(2,698,430)(8,110)9,339,416(555,810)
14,043,831*1 13,488,021

53

6. Notes

6.

<Summary of Significant Accounting Policies>
1.

Method of depreciation andamortization of non-current
assets(1) Property, plant and equipment (including trust assets)
Property, plant and equipment are depreciated using the straight-line method over theestimated useful lives as follows:
Buildings
Structures
Machinery and equipment
Tools, furniture and fixtures

Other significant accounting
policies utilized in the
preparation of financial
statements

2–70 years
2–69 years
10–34 years
2–15 years(2) Intangible assets (including assets in trust)Intangible assets are amortized by the straight-line method.

2.

3.

4.

Accounting policies fordeferred assets

Accounting standards forrevenues and expenses

Method of hedge accounting(3) Long-term prepaid expenses
Long-term prepaid expenses are amortized by the straight-line method.
(1) Investment corporation bond issuance costs
Investment corporation bond issuance costs are amortized using the straight-line
method over the redemption periods.
(2) Investment unit issuance expenses
Investment unit issuance expenses are amortized in averaged amount on a monthly
basis using the straight-line method over three years.
Accounting treatment of property tax, city planning tax, and depreciable asset tax
For property tax, city planning tax, and depreciable asset tax (“property tax”) for realestate properties held, the amounts to be paid for the fiscal periods are calculated outof the tax amounts decided to be levied and are recorded as expenses related to rent
business.
Of the amounts paid for the acquisition of real estate property or beneficial interests inreal estate trust, the amounts equivalent to property tax settled with the seller of theproperty are capitalized as part of the acquisition cost of the relevant property rather
than being charged as expenses.
(1) Method of hedge accounting
The deferred hedge method is applied.
However, the special accounting treatment is applied for interest-rate swap
transactions that meet certain criteria.
(2) Hedging instruments and hedged items
Hedging instruments: Interest rate swap transactions
Hedged items: Interest expenses on loans payable(3) Hedging policy
The Investment Corporation enters into derivative transactions based on its
investment management guidelines with the objective of hedging interest rate
fluctuation risks and other risks pertaining to borrowings, etc.

5.

54

Scope of funds (cash andcash equivalents) on theStatements of Cash Flows(4) Method of evaluating the effectiveness of hedging
As for the method of assessing the effectiveness of the hedge, the cumulative changes
in cash flow of the hedged items and hedging instruments are compared and a
judgment is made by verifying the ratio of the changed amount. However, anassessment of the effectiveness of hedging activities is omitted in the case ofinterest-rate swap transactions that meet the requirements for the special treatment.
The funds (cash and cash equivalents) on the Statements of Cash Flows consist of cash on
hand and cash in trust, deposits and deposits in trust that are readily available, andshort-term investments with maturities of three months or less from the date of purchasewhich are readily convertible to cash and with insignificant risk of market value
fluctuation.

- 34 -(1) Accounting method for beneficial interests in real estate trust and other assets
Regarding trust beneficiary interests in real estate, all assets and liability accounts of
entrusted properties as well as revenue and expense accounts generated by theproperty in trust are recorded in relevant accounts on the Balance Sheets andStatements of Income.
Important line items included in accounting for financial assets and liabilities in
the Investment Corporation’s Balance Sheets are as follows:(i) Cash and deposits in trust(ii) Buildings in trust; structures in trust; machinery and equipment in trust; tools,
furniture and fixtures in trust; land in trust; construction in progress in trust; andleasehold rights in trust(iii) Tenant leasehold and security deposits in trust(2) Accounting method for consumption taxes
Revenues and expenses in the Statements of Income do not include consumption
taxes. Non-deductible consumption taxes applicable to the acquisition of non-current
assets, etc. are included in the cost of acquisition for each asset.

<Notes to the Balance Sheets>*1. Minimum net assets pursuant to Article 67-4 of the Act on Investment Trusts and Investment Corporations
15th Fiscal Period(As of January 31, 2018)
50,0002.

(Thousands of yen)

16th Fiscal Period(As of July 31, 2018)
50,000Commitment line agreement
The Investment Corporation has commitment line contracts with four of the banks (as of January 31, 2018) and three of the banks(as of July 31, 2018), respectively.
(Thousands of yen)
15th Fiscal Period(As of January 31, 2018)
Credit limit
Outstanding debt

16th Fiscal Period(As of July 31, 2018)

10,000,000－
10,000,000

Unused commitment line

10,000,000－
10,000,000<Notes to the Statements of Income>*1. Breakdown of real estate rental revenues and expenses

A. Real estate rental revenue
Lease business revenue(Rental revenues and common service charges)(Parking revenues)
Other lease business revenue(Key money and contract renewal fees)(Other revenues)
Total real estate rental revenues
B. Real estate rental expenses
Expenses related to rent business(Property management fees and facility
management fees)(Repairs and maintenance)(Land rent)(Tax and public dues)(Insurance)(Utilities)(Marketing-related expenses)(Trust fees)(Depreciation)(Other expenses related to rent business)
Total real estate rental expenses
C. Income from real estate rental business(A - B)(Thousands of yen)
15th Fiscal Period(From August 1, 2017
to January 31, 2018)

16th Fiscal Period(From February 1, 2018
to July 31, 2018)

6,952,089
151,323

7,262,560
155,113

144,703
109,612

7,103,412
254,315
7,357,728

205,098
149,141

589,753684,012

261,422698,339
326,580
5,739
109,217
148,556
44,8801,152,256
159,605

277,912703,795
355,794
5,885
109,740
196,72146,052
1,200,838
164,772

3,496,351
3,861,377- 35 -

7,417,674
354,240
7,771,914

3,745,525
4,026,388

55

*2 Breakdown of gain on sales of real estate properties
15th Fiscal Period (From August 1, 2017 to January 31, 2018)
Not applicable.
16th Fiscal Period (From February 1, 2018 to July 31, 2018)(1) COMFORIA KOMAE
Revenue from sales of real estate properties
Cost of sales of real estate properties
Other sales expenses
Gain on sales of real estate properties(2) COMFORIA YOKOHAMAKANNAI
Revenue from sales of real estate properties
Cost of sales of real estate properties
Other sales expenses
Gain on sales of real estate properties<Notes to the Statements of Changes in Unitholders’ Equity>(Thousands of yen)
419,886
28,427927,275
53,833605,000
156,685
1,200,000*1. Total number of authorized investment
units and total number of investment
units issued and outstanding
Total number of authorized investment units
Total number of investment units issued andoutstanding

15th Fiscal Period(From August 1, 2017
to January 31, 2018)

16th Fiscal Period(From February 1, 2018
to July 31, 2018)

8,000,000 units

8,000,000 units

563,694 units

586,994 units<Notes to the Statements of Cash Flows>*1. Reconciliation of balance sheets items to cash and cash equivalents at end of period in the Statements of Cash Flows(Thousands of yen)

218,891
Cash and deposits
Cash and deposits in trust
Cash and cash equivalents

15th Fiscal Period(From August 1, 2017
to January 31, 2018)
7,558,727
6,485,103
14,043,831<Notes to lease transactions>
1. Operating lease transactions (Lessee)
Future minimum lease payments under non-cancelable operating lease transactions

Due within 1 year
Due after 1 year
Total

15th Fiscal Period(As of January 31, 2018)
1,364,328
80,358,919
81,723,247

2. Operating lease transactions (Lessor)
Future minimum lease payments receivable under non-cancelable operating lease transactions

Due within 1 year
Due after 1 year
Total

15th Fiscal Period(As of January 31, 2018)242,650
430,617673,268

16th Fiscal Period(From February 1, 2018
to July 31, 2018)
6,673,896
6,814,124
13,488,021(Thousands of yen)
16th Fiscal Period(As of July 31, 2018)
1,381,584
80,684,505
82,066,089(Thousands of yen)
16th Fiscal Period(As of July 31, 2018)
275,991
475,927
751,919<Notes to financial instruments>
1. Status of financial instruments(1) Policies for financial instruments
With a focus on stability, flexibility and efficiency as the basis of its financial policy, the Investment Corporation procures
funds through borrowings as well as the issuance of investment corporation bonds (including short-term investment
corporation bonds; the same shall apply hereinafter) and investment units among other means with the aim of growing its
investment assets through their acquisition.
The Investment Corporation may enter into derivatives transactions, which shall be executed solely for the purpose ofhedging against interest-rate fluctuations and other risks pertaining to borrowings, etc.
(2) Characteristics and risk profile of each financial instrument and risk management system
The funds for borrowings and investment corporation bonds are mainly appropriated for the acquisition of investment assets
and repayment of borrowings, etc. With regard to liquidity and interest rate fluctuation risks associated with these financing
activities, the Investment Corporation endeavors to manage and limit them by considering and implementing multifaceted
funding methods including the utilization of surplus funds and raising funds, etc. from capital markets through issuance ofinvestment units, etc. while diversifying funding sources. Although loans with floating interest rates are exposed to a risk offluctuation in interest payable, the Investment Corporation employs derivative transactions (interest-rate swap transactions)as hedging instruments in order to avoid interest rate fluctuation risks and fix payment of interest expenses. For more detailed
information on the method of hedge accounting, hedging instruments, hedged items, hedging policy and the evaluation
method for hedge effectiveness, please refer to the previous section “6. Notes: Summary of significant accounting policies, 4.
Method of hedge accounting.”(3) Supplementary note regarding fair value of financial instruments
The fair values of financial instruments presented in this report is based on their market value, and in cases where market
value is not available, reasonably estimated values are presented. Since the estimation of fair value is based on certain
assumptions, fair value could differ depending on the assumptions used.
56- 36 -- 37 -

57

2.

Fair value of financial instruments
The carrying value of financial instruments on the balance sheet, their fair value and the differences between them as of January
31, 2018 are as follows.
(Thousands of yen)
Carrying value

Fair value(Note 1)

(Note 4)

Due within
1 year or lessDifference(Note 1)

Redemption schedule for monetary claims (Thousands of yen)
15th Fiscal Period (As of January 31, 2018)

Deposits

7,558,727

Deposits in trust

6,485,103

Total

14,043,831(1) Cash and deposits

7,558,727

7,558,727－(2) Cash and deposits in trust

6,485,103

6,485,103－(3) Short-term loans payable(1,130,000)(1,130,000)－(4) Current portion of long-term loans payable(14,400,000)(14,425,683)

25,683(5) Investment corporation bonds(6,000,000)(6,049,591)

49,591

Deposits(6) Long-term loans payable(83,220,000)(83,694,376)

474,376

Deposits in trust

6,814,124

Total

13,488,021(7) Derivative transactions－－

Fair value(Note 1)

6,673,896

6,673,896－(2) Cash and deposits in trust

6,814,124

6,814,124－(4) Current portion of long-term loans payable(20,095,000)（20,105,449)

10,449(5) Investment corporation bonds(8,500,000)(8,539,553)

39,553(6) Long-term loans payable(83,135,000)(83,578,428)

443,428－－－(Note 1)
(Note 2)

(Note 3)Figures in parentheses indicate liabilities.
Methods to determine the fair value of financial instruments:(1) Cash and deposits and (2) Cash and deposits in trust
Due to their short tenors, the carrying values of these assets are reasonable approximations of their present value and hence are used as theirfair value.
(3) Short-term loans payable
Due to their short tenors, the carrying values of these assets are reasonable approximations of their present value and hence are used as theirfair value.
(4) Current portion of long-term loans payable and (6) Long-term loans payable
For loans with floating interest rates, since the interest rates on such loans reflect market rates reasonably well over the short term and theircarrying values are good approximations of their fair value, the carrying values are presented as their fair value. However, the fair value offloating-rate long-term loans payable and current portion of long-term loans payable hedged by interest-rate swap transactions subject tospecial accounting treatment (refer to the following section entitled “Notes to derivative transactions”) are calculated by discounting theaggregated principal and interest on such loans, after taking into account the effect of said interest-rate swap transactions, using reasonableestimates of the rates that would be applicable in a similar borrowing.
(5) Investment corporation bonds
The fair value of investment corporation bonds is measured based upon the present value obtained by discounting the total amount ofprincipal and interest at a rate that takes into account the term to maturity and credit risk.
(7) Derivative transactions
Please refer to the following section entitled “Notes to derivative transactions.”
Carrying value of financial instruments whose fair value cannot be reliably measured(Thousands of yen)
15th Fiscal Period(As of January 31, 2018)(1) Tenant leasehold and security deposits(2) Tenant leasehold and security deposits in trust(Note 5)16th Fiscal Period(As of July 31, 2018)(24,659)(32,740)(2,051,681)(2,160,708)

6,673,896

Repayment and redemption schedule for loans payable and investment corporation bonds (Thousands of yen)
15th Fiscal Period (As of January 31, 2018)

Difference(Note 1)

(1) Cash and deposits(7) Derivative transactions

Due within
1 year or less－

The carrying value of financial instruments on the balance sheet, their fair value and the differences between them as of July 31,
2018 are as follows.
(Thousands of yen)
Carrying value

16th Fiscal Period (As of July 31, 2018)

Short-term loans
payableCurrent portion of
long-term loans
payableLong-term loans
payableInvestment
corporation bonds
Total

Due within
1 year or lessDue after 1 year
to 2 years

Due after 2 years
to 3 years

Due after 3 years
to 4 years

Due after 4 years
to 5 years

Due after 5 years

1,130,000

－

－

－

－

－

14,400,000

－

－

－

－

－

－

13,845,000

9,200,000

13,725,000

11,560,000

34,890,000

－

－

－

3,000,000

1,000,000

2,000,000

15,530,000

13,845,000

9,200,000

16,725,000

12,560,000

36,890,000

Due within
1 year or lessDue after 1 year
to 2 years

Due after 2 years
to 3 years

Due after 3 years
to 4 years

Due after 4 years
to 5 years

Due after 5 years

20,095,000

－

－

－

－

－

－

5,050,000

10,425,000

13,800,000

13,460,000

40,400,000

16th Fiscal Period (As of July 31, 2018)

Current portion of
long-term loans
payableLong-term loans
payableInvestment
corporation bonds
Total

－

－

3,000,000

1,000,000－

4,500,000

20,095,000

5,050,000

13,425,000

14,800,000

13,460,000

44,900,000<Notes to investment securities>
15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable<Notes to derivative transactions>
1. Transactions not subject to hedge accounting
15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable(1)(2) Fair values of tenant leasehold and security deposits and leasehold and security deposits in trust are not subject to disclosure of fair value,as these items have no market value and their future cash flows are difficult to reasonably estimate given the fact that although apredetermined period for each lease contract exists, the actual deposit period cannot be calculated due to possible contract termination,
renewal or extension.
(3) Figures in parentheses indicate liabilities.

58- 38 -- 39 -

59

2.

Transactions subject to hedge accounting

2.

15th Fiscal Period (As of January 31, 2018)(Thousands of yen)
Fair value

Calculation
method for
applicable fair
value

(*2)

–

Contract amount

Hedge accounting
methodType of derivativetransactions

Hedged items

Special treatment
of interest-rate
swap transactions

Receive floating, pay
fixed interest-rate
swap transactions

Long-termloans payable
(*1)

Total

Maturing after 1 year
55,645,000

41,245,000

55,645,000

41,245,000

16th Fiscal Period (As of July 31, 2018)––(Thousands of yen)Calculation
method for
Fair value
applicable fair
Maturing after 1 year
value

Contract amount

Hedge accounting
methodType of derivativetransactions

Hedged items

Special treatment
of interest-rate
swap transactions

Receive floating, pay
fixed interest-rate
swap transactions

Long-termloans payable
(*1)

Total

48,745,000

41,245,000

48,745,000

41,245,000

–

(*2)

–

–

*1 Long-term loans payable include the current portion of long-term loans payable.
*2 Interest-rate swap transactions for which the special treatment is applied are accounted for together with long-term loans payable and the underlying
hedged items. As a result, their fair value is included in the fair value of items listed under “(4) Current portion of long-term loans payable” and “(6)Long-term loans payable” in the section entitled “2. Fair value of financial instruments” under the “Notes to financial instruments.”<Notes to retirement benefits>
15th Fiscal Period (As of January 31, 2018)
The disclosure of relevant information is omitted since the Investment Corporation does not have a retirement benefit program.
16th Fiscal Period (As of July 31, 2018)
The disclosure of relevant information is omitted since the Investment Corporation does not have a retirement benefit program.
<Notes to deferred tax accounting>
1. Components of deferred tax assets and liabilities(Thousands of yen)
15th Fiscal Period(As of January 31, 2018)

Deferred tax assets
Nondeductible enterprise tax payable
Amortization of leasehold rights
Asset retirement obligations
Subtotal of deferred tax assets
Valuation allowance
Total deferred tax assets

16th Fiscal Period(As of July 31, 2018)

460
11,85433,13845,453(44,992)
460

703
14,81833,344
48,866(48,163)703- 40 -(388)(4,973)(388)
71(4,973)(4,269)(%)

15th Fiscal Period(As of January 31, 2018)
Statutory tax rate
(Adjustments)
Deductible cash distributions
Provision of reserve for reduction entry
Other
Effective tax rate

16th Fiscal Period(As of July 31, 2018)
34.81

34.81

(35.05)
–
0.45
0.21

(31.79)(3.10)
0.48
0.41<Notes to equity in net earnings (losses) of affiliated companies>
15th Fiscal Period (As of January 31, 2018)
The disclosure of relevant information is omitted since the Investment Corporation does not have affiliated companies.
16th Fiscal Period (As of July 31, 2018)
The disclosure of relevant information is omitted since the Investment Corporation does not have affiliated companies.
<Notes to related-party transactions>
1. Parent company, major corporate unitholders and other15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable2.

Affiliated companies and other15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable3.

Fellow subsidiary companies and other15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable4.

Directors, major individual unitholders and other15th Fiscal Period (As of January 31, 2018)
Not applicable
16th Fiscal Period (As of July 31, 2018)
Not applicable<Notes to asset retirement obligations>
1. Overview of asset retirement obligations
The Investment Corporation has concluded fixed-term lease contracts with certain landlords, and recognizes asset retirement
obligations concerning the duty of restoration upon the expiry of the lease period with regard to some of these assets.
2.

Deferred tax liabilities
Property, plant and equipment
corresponding to asset retirement
obligations
Total deferred tax liabilities
Deferred tax assets (liabilities), net

60

Significant differences between the statutory tax rate and the effective tax rate

Calculation of the amount of asset retirement obligations
Asset retirement obligations are calculated based on the remaining period of the fixed-term lease (52 years) as the expectedperiod of use and 1.2% as the discount rate.

- 41 -

61

3.

Changes in the total amount of asset retirement obligations(Thousands of yen)
15th Fiscal Period(From August 1, 2017
to January 31, 2018)
Balance at beginning of period
Increase due to purchase of property, plant andequipment
Adjustment due to passage of time
Balance at end of period

16th Fiscal Period(From February 1, 2018
to July 31, 2018)

95,182

95,775

－

－

593

596

95,77596,372<Notes to investment and rental properties>
The Investment Corporation owns real estate for rental purposes (including land) in the Tokyo metropolitan area and otherregional areas. The book value, changes during the period and fair value regarding the above real estate for rental purposes are as
follows.
(Thousands of yen)
15th Fiscal Period(From August 1, 2017
to January 31, 2018)

16th Fiscal Period(From February 1, 2018
to July 31, 2018)

Book value
Balance at beginning of period

189,060,457

189,323,487

Changes during period

263,030

13,518,868

Balance at end of period

189,323,487

202,842,355

Fair value at end of period

220,729,000

236,899,000(Note 1)
(Note 2)

(Note 3)The book value excludes accumulated depreciation from acquisition cost. The book value does not include construction in progress andconstruction in progress in trust.
Among changes in the book value of real estate for rental purposes that occurred during the 15th Fiscal Period, the principal increase consistedof the acquisition of a property (COMFORIA SHIBAURA, ¥1,140,640 thousand) during the 15th Fiscal Period, while the principal decrease
consisted of depreciation of ¥1,151,663 thousand. During the 16th Fiscal Period, the principal increase consisted of the acquisition of eightproperties including COMFORIA UENOIRIYA and seven other properties during the 16th Fiscal Period totaling ¥15,785,113 thousand, while
the principal decrease consisted of the disposition of two properties including COMFORIA YOKOHAMAKANNAI and one other property
during the 16th Fiscal Period totaling ¥1,347,161 thousand and depreciation of ¥1,200,242 thousand.
The fair value at end of period is the appraisal value or the survey value determined by outside appraisers.

Income and loss related to real estate for rental purposes, etc. for the 15th Fiscal Period (From August 1, 2017 to January 31,2018) and 16th Fiscal Period (From February 1, 2018 to July 31, 2018) are listed in “Notes to the Statements of Income.”

16th Fiscal Period (From February 1, 2018 to July 31, 2018)
1. Information about each product and service
Disclosure is omitted because net sales to external customers for a single product/service category account for over 90% of
the operating revenues on the Statements of Income.
2.

3.

Information about each geographic area
(1) Net sales
Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues
on the Statements of Income.
(2) Property, plant and equipment
Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of
the amount of property, plant and equipment on the Balance Sheet.
Information about each major customer
Disclosure is omitted because there is no single external customer whose net sales accounts for 10% or more of operating
revenues on the Statements of Income.

<Notes to per unit information>

Net assets per unit

15th Fiscal Period(From August 1, 2017
to January 31, 2018)¥172,601

16th Fiscal Period(From February 1, 2018
to July 31, 2018)¥175,544¥4,744¥5,437

Profit per unit
(Note 1)

Profit per unit was calculated by dividing profit for the period by the daily weighted average number of investment units issued and outstanding.
Profit per unit after adjusting for diluted units is not included because there were no diluted investment units.

(Note 2)The basis for calculating profit per unit is as follows:

Profit (thousands of yen)Amount not attributable to common
unitholders (thousands of yen)
Profit attributable to common
investment units (thousands of yen)
Average number of investment units
for the period (units)

15th Fiscal Period(From August 1, 2017
to January 31, 2018)
2,674,567

16th Fiscal Period(From February 1, 2018
to July 31, 2018)
3,191,509－－

2,674,567

3,191,509

563,694586,908<Note to significant subsequent events>
Not applicable<Notes to segment information>(Segment information)
Disclosure is omitted because the property leasing business is the Investment Corporation’s sole business, with no reportablesegment subject to disclosure.
(Related information)
15th Fiscal Period (From August 1, 2017 to January 31, 2018)
1. Information about each product and service
Disclosure is omitted because net sales to external customers of a single product/service category account for over 90% of
the operating revenues on the Statements of Income.
2. Information about each geographic area
(1) Net sales
Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues
on the Statement of Income.
(2) Property, plant and equipment
Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of
the amount of property, plant and equipment on the Balance Sheet.
3. Information about each major customer
Disclosure is omitted because there is no single external customer whose net sales accounts for 10% or more of operating
revenues on the Statements of Income.

62- 42 -- 43 -

63

7. Supplementary schedules

COMFORIA AKABANEIWABUCHI

2,652,185－(i) Supplementary schedule of investment securities
Not applicable

COMFORIA RYOGOKU TROIS

1,780,982－

COMFORIA SHINJUKU

2,294,105－(ii) Information on contract amount and fair value of derivative transactions and forward exchange contracts
Information on derivative transactions and forward exchange contracts entered into by the Investment Corporation as ofJuly 31, 2018 is as follows.
(Thousands of yen)

COLLEGE SQUARE HACHIMANYAMA

915,765－

COMFORIA KOMAE－

419,886

COMFORIA YOKOHAMAKANNAI－

927,275

Classification

Type

Over-the-counter transactions

Receive floating, pay fixedinterest-rate swap transactions

Contract amount (Note 1)
Maturing after 1
year

Total
(Note 1)
(Note 2)

Fair value(Note 2)

48,745,000

41,245,000–

48,745,000

41,245,000–

The contract amount of interest-rate swap transactions is based on the notional principal.
Fair value is evaluated based on the value calculated by the counterparty of the contract using market interest rate, etc. Disclosure of fair value
is omitted for the transactions that meet the requirements for special treatment pursuant to the Accounting Standard for Financial Instruments.

(iii) Condensed supplementary schedule of real estate properties(Thousands of yen)

Intangible
assetsProperty, plant and equipment

Accumulated depreciation
Asset type

Buildings

2,102,140

444,363－2,546,503

139,824

28,106

2,406,679

23,641

4,659－

28,301

4,013

866

24,288

17,687－－

17,6871,188

274

16,499

2,505

557

－

3,062

623

242

2,438

3,340,008

1,334,294－

4,674,303－－

4,674,303(Note)

88,659,442

4,263,566

812,625

92,110,382

9,484,725

1,082,403

82,625,656(Note)

1,147,865

40,6244,776

1,183,712

285,120

29,749898,592(Note)

1,557,509

25,87826,384

1,557,003

248,426

27,585

1,308,576(Note)

247,203

53,9729,514

291,661

88,08022,449203,581(Note)(Note)

Structures
Machineryand equipment
Tools,
furniture andfixtures
Land
Buildings in
trust
Structures intrust
Machineryand equipmentin trust
Tools,
furniture andfixtures intrust
Land in trust

IncreaseduringperiodDecreaseduringperiodorBalance at end
Depreciation Net balance ataccumulatedof current
end of currentoramortization
periodperiodamortization
at end ofduringcurrent
periodperiodBalance at
beginning ofcurrent period

100,224,324

9,898,355

624,382

109,498,297－－

109,498,297

Total
Leaseholdrights in trust
Other

197,322,328

16,066,272

1,477,684

211,910,916

10,252,002

1,191,676

201,658,914

1,226,269－－

1,226,269

42,8278,565

1,183,441

31,504

1,075－

32,58020,8402,585

11,739Total

1,257,773

1,075

－

1,258,849

63,668

11,1501,195,181

Remarks(Note)(Note) Increases during the 16th Fiscal Period are due primarily to the acquisition of real estate for rental purposes. The details are as follows.

(Thousands of yen)
Property name64

Increase during period

Decrease during period

COMFORIA UENOIRIYA

2,256,280－

COMFORIA IKEJIRI

1,393,556－

COMFORIA SETAGAYAKAMIUMA

2,705,622－

COMFORIA KITAHAMA

1,786,614－- 44 -- 45 -

65

(iv) Supplementary schedule of other specified assets
Not applicable(vi) Supplementary schedule of borrowings
Information on the Investment Corporation’s borrowings as of July 31, 2018 is as follows:(v) Supplementary schedule of investment corporation bonds

The Investment
Corporation
1st unsecured
bonds

Issuancedate

July 30,
2014

Increaseduringperiod3,000,000

Decreaseduringperiod－－Balanceat end ofcurrent
period3,000,000

Couponrate (%)

0.64000

Redemption Redemption
methoddate

July 30,
2021

Lump-sum
repayment

Use
of
funds

(Note 2)

Lender

Security

Unsecured

Short-term loans
payableBond name

Balance at
beginningof current
periodClassification(Thousands of yen)

(Note 1)The Investment
Corporation
2nd unsecured
bonds

July 18,2017

1,000,000－－

1,000,000

0.23000

July 15,2022

Lump-sum
repayment(Note 2)

Unsecured(Note 1)The Investment
Corporation
3rd unsecured
bonds

2,000,000－－

2,000,000

0.52000

July 16,2027

Lump-sum
repayment(Note 2)The Investment
Corporation
5th unsecured
bonds

Unsecured

June 14,2018

June 14,
2018

Total

－

－

6,000,000

1,000,000

1,500,000－－

1,000,000

1,500,000

0.23000

0.95000

December 14, Lump-sum
2023

repayment

Lump-sum
June 14, 2033 repayment(Note 2)－0.25545

250,000－

0.25545

Sumitomo Mitsui Trust Bank, Limited

250,000－

250,000－

0.25545

Sumitomo Mitsui Banking Corporation

130,000－

130,000－

0.25545

Subtotal

1,130,000－

1,130,000－－

Mizuho Bank, Ltd.

3,570,000－－

3,570,000

0.55450

Sumitomo Mitsui Trust Bank, Limited

3,570,000－－

3,570,000

0.55450

MUFG Bank, Ltd.
(Note 4) (Note 5)

3,570,000－－

3,570,000

0.55450(Note 2)

Unsecured2,500,000－

8,500,000－

Due after 1 year
to 2 years－

Due after 2 years
to 3 years
3,000,000- 46 -

Due after 3 years
to 4 years
1,000,000

Due after 4 years
to 5 years－

Due after 5 years
4,500,000

1,785,000－－

1,785,000

0.55450

2,000,000－－

2,000,000

0.79500

2,700,000－

2,700,000－

0.67075

1,350,000－

1,350,000－

0.67075

600,000－

600,000－

0.67075

Development Bank of Japan Inc.

1,350,000－－

1,350,000

0.90487

MUFG Bank, Ltd.
(Note 4) (Note 5)

2,000,000－－

2,000,000

0.60700

Development Bank of Japan Inc.

1,000,000－－

1,000,000

0.60700

Mizuho Bank, Ltd.

1,000,000－－

1,000,000

0.60700

Sumitomo Mitsui Trust Bank, Limited

1,000,000－－

1,000,000

0.60700

Sumitomo Mitsui Banking Corporation

500,000－－

500,000

0.60700

MUFG Bank, Ltd.
(Note 4) (Note 5)

2,000,000－－

2,000,000

0.88240Development Bank of Japan Inc.

1,000,000－－

1,000,000

0.88240

Mizuho Bank, Ltd.

1,000,000－－

1,000,000

0.88240

Sumitomo Mitsui Trust Bank, Limited

1,000,000－－

1,000,000

0.88240

Sumitomo Mitsui Banking Corporation

500,000－－

500,000

0.88240

1,340,000－－

1,340,000

0.60150

Sumitomo Mitsui Banking Corporation

UnsecuredThe bonds are subject to the pari passu clause among specified investment corporation bonds.
The funds are appropriated to acquire of real estate in trust and repayment of certain existing borrowings.
The total amount of redemption of investment corporation bonds for each year during the five years following the balance sheet date is as shown
below.
(Thousands of yen)
Due within 1 year
or less

66

500,000－

Mizuho Bank, Ltd.

(Note 1)

(Note 1)
(Note 2)
(Note 3)－250,000

MUFG Bank, Ltd.
(Note 5)
MUFG Bank, Ltd.
(Note 4) (Note 5)Long-term loans payable (Note 1)(Note 1)500,000

Mizuho Bank, Ltd.

Sumitomo Mitsui Banking Corporation

July 18,
2017(Note 1)The Investment
Corporation
4th unsecuredbonds

MUFG Bank, Ltd.
(Note 4) (Note 5)

Balance atBalance at end
Increase
Decrease
Average
beginning ofof current
during period during periodinterest ratecurrent period
period(thousands of (thousands of(%)(thousands of(thousands of
yen)
yen)
(Note 2)yen)
yen)

MUFG Bank, Ltd.
(Note 4) (Note 5)
Development Bank of Japan Inc.

670,000－－

670,000

0.60150

Mizuho Bank, Ltd.

670,000－－

670,000

0.60150

Sumitomo Mitsui Trust Bank, Limited

670,000－－

670,000

0.60150

Sumitomo Mitsui Banking Corporation

350,000－－

350,000

0.60150- 47 -

Maturity
date

Repayment
methodUse offunds

Remarks

July 31,2018

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

－

－

－

－

March 23,
2019

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

August 31,
2018

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

March 30,
2018

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

September
30, 2019

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

January 31,
2019

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

January 31,
2021

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

June 30,
2020

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed67Classification
Lender
MUFG Bank, Ltd.
(Note 4) (Note 5)－－

1,820,000

Repayment
methodUse offunds

Classification
Remarks

Lender
MUFG Bank, Ltd.
(Note 4) (Note 5)

0.90100

Balance atBalance at end
Increase
Decrease
Average
beginning ofof current
Repayment
during period during periodinterest ratecurrent period
periodMaturity datemethod(thousands of (thousands of(%)(thousands of(thousands of
yen)
yen)
(Note 2)yen)
yen)
980,000－－

980,000

0.67745Development Bank of Japan Inc.

490,000－－

490,000

0.67745

Mizuho Bank, Ltd.

490,000－－

490,000

0.67745

910,000－－

910,000

0.90100

Mizuho Bank, Ltd.

910,000－－

910,000

0.90100

Sumitomo Mitsui Trust Bank, Limited

910,000－－

910,000

0.90100

Sumitomo Mitsui Trust Bank, Limited

490,000－－

490,000

0.67745

Sumitomo Mitsui Banking Corporation

450,000－－

450,000

0.90100

Sumitomo Mitsui Banking Corporation

220,000－－

220,000

0.67745

Shinkin Central Bank

750,000－

750,000－

0.30820Development Bank of Japan Inc.

1,570,000－－

1,570,000

0.27125

MUFG Bank, Ltd.
(Note 5)

1,570,000－－

1,570,000

0.27125

1,000,000－－

1,000,000

0.27125

785,000－－

785,000

0.27125
0.61950

June 30,2022

March 30,
2018

Lump-sum
repayment

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

Unsecured
Unguaranteed

The Norinchukin Bank

750,000－

750,000－

0.30820

The Bank of Fukuoka, Ltd.

750,000－

750,000－

0.30820

Kiraboshi Bank, Ltd. (Note 6)

1,200,000－－

1,200,000

0.69250

Sumitomo Mitsui Trust Bank, Limited－

600,000

0.69250Development Bank of Japan Inc.

2,000,000－－

2,000,000

MUFG Bank, Ltd.
(Note 5)2,000,000－－

2,000,000

0.61950Development Bank of Japan Inc.

600,000－

Mizuho Bank, Ltd.

600,000－－

600,000

January 31,
0.69250
2022

Sumitomo Mitsui Trust Bank, Limited

600,000－－

600,000

0.69250

Sumitomo Mitsui Trust Bank, Limited

1,000,000－－

1,000,000

0.61950

Sumitomo Mitsui Banking Corporation

300,000－－

300,000

0.69250

MUFG Bank, Ltd.
(Note 4) (Note 5)

1,160,000－－

1,160,000

0.46655

1,240,000－－

1,240,000

0.79875

Development Bank of Japan Inc.

580,000－－

580,000

0.46655

620,000－－

620,000

0.79875

Mizuho Bank, Ltd.

580,000－－

580,000

0.46655

Sumitomo Mitsui Trust Bank, Limited

580,000－－

580,000

0.46655

Sumitomo Mitsui Banking Corporation

290,000－－

290,000

0.46655

Development Bank of Japan Inc.
Mizuho Bank, Ltd.

620,000－－

620,000

January 31,
0.79875
2023

Sumitomo Mitsui Trust Bank, Limited

620,000－－

620,000

0.79875

Sumitomo Mitsui Banking Corporation

310,000－－

310,000

0.79875

1,240,000－－

1,240,000

1.04200

620,000－－

620,000

1.04200

MUFG Bank, Ltd..
(Note 4) (Note 5)
Development Bank of Japan Inc.

(Note 3)

Unsecured
Unguaranteed(Note 1)

MUFG Bank, Ltd.
(Note 4) (Note 5)

Lump-sum
repayment(Note 3)Lump-sum
repayment

1,800,000－－

1,800,000

0.65518

Development Bank of Japan Inc.

900,000－－

900,000

0.65518

Mizuho Bank, Ltd.

900,000－－

900,000

0.65518

Sumitomo Mitsui Trust Bank, Limited

900,000－－

900,000

0.65518

Mizuho Bank, Ltd.

620,000－－

620,000

Sumitomo Mitsui Trust Bank, Limited

620,000－－

620,000

1.04200

Sumitomo Mitsui Banking Corporation

450,000－－

450,000

0.65518

Sumitomo Mitsui Banking Corporation

310,000－－

310,000

1.04200

Mizuho Trust & Banking Co., Ltd.

2,000,000－－

2,000,000

0.46691

MUFG Bank, Ltd.
(Note 4) (Note 5)

720,000－－

720,000

0.58430

The Norinchukin Bank

1,500,000－－

1,500,000

0.46691

Development Bank of Japan Inc.

360,000－－

360,000

0.58430

The Bank of Fukuoka, Ltd.

1,000,000－－

1,000,000

0.46691

Mizuho Bank, Ltd.

360,000－－

360,000

0.58430

500,000－－

500,000

0.46691

Sumitomo Mitsui Trust Bank, Limited

360,000－－

360,000

0.58430

The Daishi Bank, Ltd.

Sumitomo Mitsui Banking Corporation

200,000－－

200,000

0.58430

MUFG Bank, Ltd.
(Note 4) (Note 5)

MUFG Bank, Ltd.
(Note 4) (Note 5)

840,000－－

840,000

0.62460

Development Bank of Japan Inc.

420,000－

420,000

0.62460－Mizuho Bank, Ltd.

420,000－－

420,000

0.62460

Sumitomo Mitsui Trust Bank, Limited

420,000－－

420,000

0.62460

Sumitomo Mitsui Banking Corporation

230,000－－

230,000

0.62460- 48 -

August 31,
2023

Lump-sum
repayment

Lump-sum
repayment(Note 3)(Note 3)(Note 3)

Unsecured
Unguaranteed

MUFG Bank, Ltd.
(Note 4) (Note 5)

January 31,
1.04200
2025

March 31,2023

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

Long-term loans payable

Long-term loans payable (Note 1)

1,820,000

Maturity
date

Development Bank of Japan Inc.

MUFG Bank, Ltd.
(Note 4) (Note 5)

68

Balance atBalance at end
Increase
Decrease
Average
beginning ofof current
during period during periodinterest ratecurrent period
period(thousands of (thousands of(%)(thousands of(thousands of
yen)
yen)
(Note 2)yen)
yen)

Unsecured
Unguaranteed

Unsecured
Unguaranteed

The 77 Bank, Ltd.

500,000－－

500,000

0.46691

1,160,000－－

1,160,000

0.62938

Development Bank of Japan Inc.

580,000－－

580,000

0.62938

Mizuho Bank, Ltd.

580,000－－

580,000

0.62938

Sumitomo Mitsui Trust Bank, Limited

580,000－－

580,000

0.62938

Sumitomo Mitsui Banking Corporation

290,000－－

290,000

0.62938- 49 -

Use offunds

Remarks

February 29, Lump-sum
2024
repayment(Note 3)

Unsecured
Unguaranteed

March 31,2021

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

March 31,2025

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

July 31,2024

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

July 31,2026

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

January 31,
2022

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

January 31,
2024

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed69Balance atBalance at end
Increase
Decrease
Average
beginning ofof current
during period during periodinterest ratecurrent period
period(thousands of (thousands of(%)(thousands of(thousands of
yen)
yen)
(Note 2)yen)
yen)Classification
Lender
MUFG Bank, Ltd.
(Note 4) (Note 5)

1,820,000－－

1,820,000

0.79571

Development Bank of Japan Inc.

910,000－－

910,000

0.79571

Mizuho Bank, Ltd.

910,000－－

910,000

0.79571

Sumitomo Mitsui Trust Bank, Limited

910,000－－

910,000

0.79571

Sumitomo Mitsui Banking Corporation

450,000－－

450,000

0.79571

1,140,000－－

1,140,000

0.49054

Development Bank of Japan Inc.

570,000－－

570,000

0.49054

Mizuho Bank, Ltd.

570,000－－

570,000

0.49054

Sumitomo Mitsui Trust Bank, Limited

570,000－－

570,000

0.49054

Sumitomo Mitsui Banking Corporation

300,000－－

300,000

0.49054

MUFG Bank, Ltd.
(Note 4) (Note 5)

MUFG Bank, Ltd.
(Note 4) (Note 5)

1,140,000－－

1,140,000

0.77571

Development Bank of Japan Inc.

570,000－－

570,000

0.77571

Mizuho Bank, Ltd.

570,000－－

570,000

0.77571

Sumitomo Mitsui Trust Bank, Limited

570,000－－

570,000

0.77571

Sumitomo Mitsui Banking Corporation

300,000－－

300,000

0.77571

Sumitomo Mitsui Trust Bank, Limited－

100,000－

100,000

0.25376

MUFG Bank, Ltd.
(Note 4) (Note 5)－

1,040,000－

1,040,000

0.65428

Development Bank of Japan Inc.

－

520,000－

520,000

0.65428

Mizuho Bank, Ltd.

－

520,000－

520,000

0.65428

Sumitomo Mitsui Trust Bank, Limited－

520,000－

520,000

0.65428

Sumitomo Mitsui Banking Corporation－

260,000－

260,000

0.65428

MUFG Bank, Ltd.
(Note 4) (Note 5)－

1,240,000

1,240,000－

0.25426

Mizuho Bank, Ltd.

－620,000

620,000－

0.25426

Sumitomo Mitsui Trust Bank, Limited－

620,000

620,000－

0.25426

Sumitomo Mitsui Banking Corporation－

310,000

310,000－

0.25426

Shinkin Central Bank－

1,300,000－

1,300,000

0.45804

The Norinchukin Bank－

1,300,000－

1,300,000

0.45804

The Bank of Fukuoka, Ltd.

－1,300,000－

1,300,000

0.45804

Mizuho Trust & Banking Co., Ltd.

－

1,000,000－

1,000,000

0.45804

MUFG Bank, Ltd.
(Note 4) (Note 5)－

2,700,000－

2,700,000

0.62188

Mizuho Bank, Ltd.

－

1,350,000－

1,350,000

0.62188
0.62188－

600,000－

600,000

97,620,000

15,300,000

9,690,000

103,230,000

98,750,000

15,300,000

10,820,000

103,230,000

Sumitomo Mitsui Banking Corporation
Subtotal
Total(Note 1)
(Note 2)
(Note 3)(Note 4)(Note 5)(Note 6)(Note 7)(Note 8)

Repayment
methodUse offunds

Remarks

January 30,
2026

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

September
30, 2022

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

September
30, 2026

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

February 28, Lump-sum
2019
repayment(Note 3)

Unsecured
Unguaranteed

January 31,
2025

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

April 30,
2019
(Note 7)Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

March 31,2023

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

March 31,2025

Lump-sum
repayment(Note 3)

Unsecured
Unguaranteed

－

－

－

－

－

Long-term loans payable include the current portion of long-term loans payable.
The average interest rate is the interest rate for each loan contract rounded to the fifth decimal place. As for the borrowings hedged byinterest-rate swap transactions in order to avoid interest rate fluctuation risk, the interest rates reflect the effect of interest-rate swap transactions.
The use of funds is mainly for the acquisition of real estate in trust and repayment of existing borrowings, etc.
The Bank of Tokyo-Mitsubishi UFJ, Ltd. changed its name to MUFG Bank, Ltd. as of April 1, 2018.
Mitsubishi UFJ Trust and Banking Corporation transferred its corporate lending operations to MUFG Bank, Ltd. on April 16, 2018.
The Tokyo Tomin Bank, Ltd. merged with The Yachiyo Bank, Ltd. and ShinGinko Tokyo, Ltd. on May 1, 2018, and was renamed Kiraboshi
Bank, Ltd.
The amount was repaid in full ahead of schedule on June 22, 2018.
The total amount of repayment of long-term loans payable for each year during the five years following the balance sheet date is as shown
below.
(Thousands of yen)
Due within 1
year or less
20,095,000

70Maturitydate

Due after 1 year
to 2 years

Due after 2 years
to 3 years

Due after 3 years
to 4 years

Due after 4 years
to 5 years

Due after 5 years

5,050,000

10,425,000

13,800,000

13,460,000

40,400,000- 50 -

71