Investor Presentation for the 26th Fiscal Period Ended February 2019 held on April 19, 2019
Major Questions and Answers (summary)Q. 1
Was the upward rent revision for one of the logistics properties attributable to tenants directly or thefavorable supply-demand environment?
Ans. 1
Both ended up being factors. The logistics property subject to rent increase is situated in an excellent
location near a station and an interchange of a highway. We would like to continue to raise the rentof properties with such favorable conditions.
Q. 2
The rent of residential properties upon tenant replacement is now more bullish. Are there any
differences in the trend in accordance with unit type?
Ans. 2Location provides a larger impact than unit type. Rent upon tenant replacement increased by 2.4%
on average, and increased by 3.8% in the 5 central wards of Tokyo. We believe such bullish market
trend will continue as the supply of new properties is limited while the population concentrates inTokyo.
Q. 3
Is it likely we will see an increase in the number of projects eyeing future redevelopment?
Ans. 3
As it is becoming difficult to acquire residential properties in central Tokyo at a high yield, we would
like to also acquire old properties with an eye on future redevelopment.
Q. 4I have the impression that properties acquired through the equity offering this time were acquired ata yield higher than the original forecast. What is your future forecast?
Ans. 4We acquired the logistics properties in Hachioji City at highly favorable appraisal NOI yields of4.8%. We believe that acquisition of Aoyama Tailor Bunkyo Sengoku Ekimae Store was also at a1

favorable yield when considering the location in front of a station in central Tokyo. As for our basic
policy to invest 70% or more in the three major metropolitan areas, the percentage of properties
acquired from March to April this year located in those area was 76.4%. We intend to raise thepercentage of properties located in the three major metropolitan areas a bit more, but it may becomeslightly difficult to maintain the average NOI yield of the current portfolio (5.3%) if we raise thepercentage. As for the future, we plan to acquire properties to maintain the total yield even when
there are properties with low yield while being aware of the level of the implied cap rate.
Q. 5
Upon achieving an asset size of 800 billion yen, do you intend to settle down or will you seek tocontinue expansion?
Ans. 5We intend to reevaluate the pace of property acquisition by assessing the content of the new
mid-term management plan of the sponsor scheduled to be announced in May.
Q. 6
An annual growth in stabilized DPU of around 3% to 4% was achieved as a result of the three equity
offerings conducted after the merger, but what is your future forecast?
Ans. 6Growth in DPU was achieved as a result of acquisition of properties worth 80 billion to 90 billion
yen per year after the merger. We are under the impression that acquisition of properties worth 80
billion to 90 billion yen per year is becoming slightly difficult, yet we will remain conscious of theacquisition pace of 50 billion to 60 billion yen per year which has been our goal since the merger.
We believe growth in DPU of around 3% is difficult when assuming an acquisition scale of 50
billion to 60 billion yen per year.
Q. 7
Large equity offerings centering on the acquisition of logistics properties may sometimes be subject
to severe pressure, but what do you think of the equity story for future equity offerings?
Ans. 7As seen in the pipeline, the sponsor is focusing on development of not only logistics properties but
also hotels and complex facilities. As a diversified REIT, our aim is to acquire various types ofassets.
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Q. 8
While there were merits resulting from the implementation of the past three equity offerings inalmost the same period, the investment unit price tended to be bearish due to a sense of caution
before the announcement of the equity offerings. What is your view on the timing of the equityofferings?
Ans. 8When it comes to the investment unit price, there may have been a trend as you have pointed out. We
are constantly aware of the level of the investment unit price and had an option to postpone equity
offerings under severe circumstances. As for the future, the acquisition scale and timing have yet tobe determined. We look to consider various options such as property replacements and the utilizationof cash on hand by eyeing the timing of property acquisitions.
Q. 9
What was the cause of the downward rent revision for some logistics properties?
Ans. 9The change in the amount of taxes including property tax was the main cause. There are various
contract types for logistics properties and we also own properties whose rents were forced to be
reduced upon negotiations with the lessee.
Q. 10
Is there a possibility that the rents of logistics properties will be revised upward?
Ans. 10
It is currently difficult to raise the rent of BTS-type properties, but we will conduct negotiations forrent increase upon the rent revision of properties whose rents are linked to indicators such asproperty tax. We intend to make efforts to improve the conditions of contracts such as aiming toextend the contract period of properties in an excellent location at the same time since raising therent of multi-tenant-type properties is relatively easy.
Q. 11
Are you planning to shorten the contract period of logistics properties to further reflect the rent levelin the market?

3Ans. 11
The contract period is long, but we believe that there is no need to shorten the contract period as therent will be revised once in a given period.
Q. 12
Will you remain aware of DPU growth by 100 yen when conducting equity offerings to achieve anasset size of 800 billion yen?
Ans. 12
We will not change the initial plan of increasing DPU by 100 yen by conducting equity offerings
until we achieve an asset size of 800 billion yen. Upon achievement, we intend to reevaluate ourplan from the viewpoint of the new mid-term management plan of the sponsor.
Q. 13
What is your view on the buyback of own investment units?
Ans. 13
We recognize that buyback of own investment units is an effective measure regarding return tounitholders. We have prioritized property acquisition until now as a use of free cash flow of around 8
billion yen per year since we have an extensive pipeline.
Q. 14
What is your policy on selling properties?
Ans. 14
There are about 20 properties listed as candidates to be sold due to reasons such as failing to achieve
the expected yield or being situated in inferior locations. Residential properties as well as propertiesof other asset classes have been listed as candidate to be sold.
Q. 15
Is there a possibility that demand for renewal of facilities at low-temperature logistics properties will
increase with the objective of adapting to the new refrigerant in accordance with the regulation on
fluorocarbon gas from 2020? Also, are there any merits in low-temperature logistics properties suchas having a high NOI yield?

4Ans. 15
As of now, we do not plan to acquire low-temperature logistics properties in a proactive manner. Inaddition, there is a possibility that unit rent will increase, but we do not think that the yield of suchproperties is particularly high compared to other logistics properties.

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