AEON Group and AEON --- P

AEON MALL Kofu Showa

AEON REIT Investment Corporation Presentation Material for Investor Meeting For the 12th Fiscal Period Ended January 31, 2019 March 19, 2019 Securities Code: 3292 Asset Manager: https://www.aeon-jreit.co.jp/en/index.html AEON Reit Management Co., Ltd. Table of Contents

I. Overview of Financial Results for the 12th Fiscal Period III. Forecasts of Performances and Future Objectives Ended January 31, 2019 Financial Highlights of the 12th Fiscal Period Ended January 31, １． --- P. 4 １． Financial Forecasts(13th&14th) --- P. 26 2019 ２． Topics for 12th Fiscal Period—External Growth/Internal Growth— --- P. 5 ２． Activities to Achieve Sustainability—AEON Group and AEON --- P. 27 REIT— ３． Topics for 12th Fiscal Period—Financing Matters— --- P. 6 Overview of Financial Results for the 12th Fiscal Period Ended ３． Future Growth Objectives --- P. 28 ４． --- P. 7 January 31, 2019 ４． Messages from the Management Team --- P. 29 ５． Portfolio Indicators at the End of 12th Fiscal Period --- P. 8

II. AEON REIT’s Strengths and Growth Strategy １． Trends in Results for Five-Year Period After Listing --- P. 10 ２． AEON REIT’s Advantages --- P. 11 Appendix 1 Characteristics of AEON REIT --- P. 31-48 ３． External Growth—Pipeline Support— --- P. 12 External Growth—AEON Group’s business domains and ４． --- P. 13 pipelines— Appendix 2 Supplement --- P. 50-69 ５． External Growth—Advantages of investment targets— --- P. 14

External Growth—Stance on property acquisitions and future ６． --- P. 15 initiatives— ７． Internal Growth—Investment for Expansion and Renewal— --- P. 16 Internal Growth—Robust Matter Lease Agreement with the AEON ８． --- P. 17 Group— ９． Internal Growth—Lease Structure— --- P. 18

10． Introduction of Individual Property (AEON Mall Kurashiki) --- P. 19 Financing policy—Diversification of Lenders and Financing 11． --- P. 20 Methods (1)— Financing policy—Diversification of Lenders and Financing 12． --- P. 21 Methods (2)— 13． Risk Management --- P. 22

14． Strategic cash management—Cash Generation Skills— --- P. 23 Strategic cash management Utilization for the growth of 15． --- P. 24 distribution

2 I. Overview of Financial Results for the 12th Fiscal Period Ended January 31, 2019 Financial Highlights of the 12th Fiscal Period Ended January 31, 2019

Improved quality of the portfolio through sustained and stable growth.

12th Fiscal Period Ended January 31, 2019

Distributions per unit 3,066 yen Distributions Up 56 yen (+1.9%) from 3,010 yen, the initial forecast

Acquired the extended building at Kofu Showa External Unrealized gain up 0.8 billion yen Growth Increase in rent (annualized) up 0.53 billion yen

Investing in revitalization of property to boost revenue and competitiveness Kurashiki (accessibility improvement work) Internal Increase in rent: up 3.10 million yen/year Growth Kagoshima and Yamagata Minami (disaster prevention work) Increase in rent: up 3.32 million yen/year

Refinancing 27.0 billion yen (including 15.0 billion yen through issuance of retail bonds) Financial Average residual period 3.7 years → 4.6 years Overall situation of Strategy interest-bearing debt Average financing cost 0.80% → 0.78%

4 Topics for 12th Fiscal Period - External Growth/Internal Growth -

Strengthened profitability by utilizing sufficient cash on hand without depending on borrowings. External Acquisition of an extended building of the existing AEON MALL building at Kofu Showa. Growth Effects of the acquisition of the extended building at Kofu Showa and renewal of the existing building Evolution to an overwhelmingly top- Overview of AEON MALL Kofu Showa 1 Increase of 0.8 billion yen in 2 Increase in annual rent 3 unrealized gain (note) rated local community mall After acquisition of 1,346 extended building （㎡） Existing building million yen (Existing and Store areas in the 10 km trading area (Acquired) extended buildings) 80,000 Increased 70,000 806 of rent AEON Group’s strength +0.8 60,000 in development capability Location Nakakoma-gun, Yamanashi Pref. billion million yen 50,000 yen 1.3 40,000 Acquisition 8.3 bilion yen 15.4 billion yen Rent Rent 30,000 price billion yen of the of the 20,000 Appraisal 0.5 existing existing 10,000 8.6 billion yen 17.3 billion yen building building price billion 0 Site area 119,064.22㎡ yen Before acquisition After acquisition Rent of the Rent of the extended building 増築棟取得前増築棟取得後 Total floor 66,417.84 ㎡ 99,680.71㎡ of the extended of the extended existing building + Rent after renewal of the area building building (before renewal) existing building (Note) Unrealized gain: (Appraisal value at the end of the 11th fiscal period – Book value at the end of the 11th fiscal period) + Appraisal value at the time of acquisition of the extended building at Kofu Showa (existing and extended buildings) – (Book value of the existing building + Acquisition value of the extended building + Expenses for investment in the revitalization of the existing building)

Internal Improved accessibility by installing a new exit and entrance and implemented disaster prevention Growth measures, preferentially. Increase in rent Property Detail Effect Investment (annualized) Installation of a new exit and entrance on Improvement in AEON MALL Kurashiki 44 million yen ＋3.1 million yen the north side of the mall accessibility

AEON MALL Kagoshima 72 million yen ＋2.1 million yen Anti-smoke hanging walls made of Disaster prevention inflammable films measures AEON MALL Yamagata Minami 38 million yen ＋1.1 million yen

5 Topics for 12th Fiscal Period -Financing Matters-

Successfully diversified our means of financing, extending our procurement period and reducing our procurement cost.

Poster Issuance AEON REIT’s first retail bonds announcing the Conditions of investment Effects of investment issuance corporation bonds Issuance corporation bonds 15 billion yen amount Diversification of financing means Retail bonds with Term 10 years JREIT’s largest Enhancement of the investment issuance amount Interest rate 0.783% corporation’s popularity and longest term Gift for AEON gift (Acquisition of potential investors) purchasers certificate

Refinancing Overview of Results of refinancing refinancing 1 Implemented the refinancing of 27 billion yen, funds borrowed when an IPO 1 Extended the term and reduced procurement cost. was made. Increased the number of financial institutions 2 Allotted funds procured through the issuance of retail bonds to funds for the 2 refinancing. that provide loans to 23 (21 at the end of the 3 Raised new loans from The Yamaguchi Bank and The Gunma Bank, Ltd. in 11th fiscal period). efforts to diversify procurement sources. Comparison of procuring conditions (27 billion yen) Comparison of interest-bearing debts (150billion yen)

Before refinancing After refinancing Before refinancing After refinancing

Total amount of refinancing 27 billion yen 27 billion yen Interest-bearing debts 150 billion yen 150 billion yen

Initial procurement period 4.9 years 7.8 years Average residual period 3.7 years 4.6 years

Average financing cost 0.78% 0.71% Average financing cost 0.80% 0.78%

6 Overview of Financial Results for the 12th Fiscal Period Ended January 31, 2019 Removed the impact of disasters and achieved distribution of 3,066 yen, a significantly larger amount than the initial announcement. 11th Fiscal Period 12th Fiscal Period Ended January 2019 Ended July 2018 Result Result vs. Previous Period Initial Forecast vs. Forecast (A) (B) (B-A) (C) (B-C) Operating Revenues (Millions of yen) 16,201 16,329 ① +127 16,283 ⑦ +45 Operating Expenses (Millions of yen) 10,019 9,993 ② ▲25 10,014 ⑧ ▲20 Operating Income (Millions of yen) 6,182 6,335 +153 6,269 +66 Ordinary Income (Millions of yen) 5,297 5,448 ③ +151 5,362 ⑨ +86 Extraordinary income (Millions of yen) - 152 ④ +152 - ⑩ +152 Extraordinary Loss (Millions of yen) 37 274 ⑤ +237 - ⑪ +274 Net Income (Millions of yen) 5,254 5,325 +71 5,357 ▲31 Reversal of dividend (Millions of yen) reserves - 122 ⑥ +122 - ⑫ +122 Distributions per Unit (yen) 2,956 3,066 +110 3,010 +56 NOI (Millions of yen) 11,299 11,553 +254 11,529 +23 (Note) The number of investment units issued for each period is 1,777,347. 【Major factors of changes from the previous period】【Major factors of changes from the forecast】 No. Main items Amount (million yen) No. Main items Amount (million yen) Newly acquired properties/ +586 Income from dividends paid by overseas SPCs +9 rent income from extended properties ⑦ Rent income from properties sold ① ▲407 Insurance income +27 in the previous period Absence of gains from sale of properties ▲35 Expenses for the leasing business +5 as posted in the previous fiscal period ⑧ Rent expenses for properties sold ▲224 Fund costs ▲25 in the previous fiscal period ② Depreciation for newly-acquired properties +211 Loan related costs ▲58 and extended properties ⑨ Loan related costs ▲37 Investment corporation bond related costs +39 ③ Investment corporation bond related costs +39 ⑩ Insurance income +152

④ Insurance income +152 ⑪ Disaster related losses +274

⑤ Disaster related losses +237 ⑫ Reversal of dividend reserves(⑪－⑩) +122

⑥ Reversal of dividend reserves +122 7 Portfolio Indicators at the End of 12th Fiscal Period

Portfolio that features stable revenues, and sufficient borrowing capacities and unrealized gains.

Asset size（Note 1）40 properties Portfolio NOI yield Unrealized gains（Note 2）

362.4 billion yen 6.4% Up 45.0 (up 7.1 billion yen from NOI yield after portfolio depreciation billion yen the end of the 11th period) (up 4.4 billion yen from 3.9% the end of the 11th period)

Net asset value (NAV) Loan to Value (LTV) Distributions per unit per unit (excl. leasehold deposits) 41.4％ (incl. leasehold deposits) 44.9％ yen 3,066 yen 133,464 Available capacity（Note 4） (up 2,507 yen from (up 1.9% from initial forecast) the end of the 11th period) (Note 3) Approx. 37.0 billion yen

Note 1: The total purchase price not including expenses (brokerage fees, taxes and dues, etc.) incurred for the purchase of the real estate, etc. Note 2: The unrealized gain and loss as of the end of the 12th fiscal period (difference between appraisal value and book value at the end of each fiscal period) Note 3: The difference from the distribution forecast of 3,010 yen for the 12th fiscal period announced on September 12, 2018 Note 4: The amount of interest-bearing debts that can be acquired until LTV (including leasehold deposits) reaches 50% 8 II. AEON REIT’s Strengths and Growth Strategy Trends in Results for Five-Year Period After Listing

Achieved expansion of asset size, diversification of investment targets, distribution growth and an increase in NAV 資産規模の推移とアセットクラスの多様化Change in the asset size and diversification of the asset class Initiatives leveraging AEON REIT’s strengths 362.4 billion yen 3rd Fiscal Period Ended 7th Fiscal Period Ended 8th Fiscal Period Ended July 2014 July 2016 January 2017 SRSC 7.7%

RSC 78.1% 158.9 billion yen Asset size CSC 4.0% SRSC 17.6% by 2.2 times Logistics 8.5% RSC 82.0% Overseas 0.4% Overseas 1.6%

3rd Fiscal第３期 Period 12th第１２期 Fiscal Period AEON Taman Universiti SC Daiei Kawasaki Process Center AEON MALL Seremban 2

Acquisition of logistics Acquisition of properties Distributions per unit J-REIT’s first acquisition properties to support by utilizing the overseas of overseas properties commercial distribution 3,066yen SPC scheme 2,461 yen systems Increase of 124.6％ 10th Fiscal Period Ended 11th Fiscal Period Ended 12th Fiscal Period Ended January 2018 July 2018 January 2019 AEON MALL Kofu Showa AEON Style AEON MALL Kyoto Gojo 3rd 第３期Fiscal Period 12th第１２期 Fiscal Period Kemigawahama

Net asset value (NAV) per unit 133,464 yen

112,635 yen Increase of 118.5％ Acquisition of new Strategic property Scheme for the properties through the replacement acquisition of extended Group’s collaborative Kumamoto⇔Kyoto Gojo buildings 3rd 第３期Fiscal Period 12th Fiscal第１２期 Period initiatives 10 AEON REIT’s Advantages

AEON REIT’s unique growth strategy built on AEON Group’s strengths.

External Growth Internal Growth Financing Policy

Effective building extensions Implementation of stable １ Strength due to many pipelines ３ and revitalization ５ fund-raising Take advantage of many pipelines in Increase property value by taking Implement stable financing operations acquiring properties through measures in line with changes in the such as the issuance of retail bonds and negotiated transactions. business environment and local increase in the number of loan providers. characteristics. (→ pages 12 & 13) (→ pages 20 & 21) (→ page 16) Risk Management

Investment in community Consistent payment of ２４ Robust master leasing scheme ６ infrastructure distributions Promote the diversification of asset Achieve stable rent income through Enhance consistency through the types including urban-based the conclusion of long-term and fixed coverage of earthquake insurance properties. master leasing agreements. and effective utilization of reserves. (→ pages 14 & 15) ( → pages 17 & 18) (→ page 22)

Strategic Cash Management

７ Generation of free cash flow ８ Flexible utilization of cash on hand

Generate free cash flow of approximately Create diverse and flexible choices in response 7.0 billion yen per year. to a variety of settings. (→ page 23) (→ page 24)

11 External Growth Strategy -Pipeline Support-

Aim to increase the asset size by utilizing AEON Group’s many pipelines. Advantages of pipeline support Offering of information from Acquisition of preferential Utilization of warehousing within the AEON Group negotiation rights functionality Properties owned by （Note2）（Note3）（Note 4） Properties managed by pipeline support companies AEON REIT Investment Corporation AEON Mall Co., Ltd. AEON Retail Co., Ltd. AEON Retail Co., Ltd. AEON Hokkaido Co., Ltd. 21properties AEON KYUSHU CO., LTD. AEON RYUKYU CO., LTD. AEON Mall Co., Ltd. The Daiei, Inc. 175 SC 11properties

AEON Hokkaido Co., Ltd. Japan 913 stores（Note 1） 2properties AEON TOWN Co., Ltd. （GMS・SM・DS・HC・SuC） Acquisition Japan of properties AEON KYUSHU CO., LTD. through 38 AEON GLOBAL SCM CO., LTD. negotiated 1property properties 140 SC transactions The Daiei, Inc. facilities 56 2properties

AEON GLOBAL SCM CO., LTD. AEON Mall Co., Ltd. AEON Co. （M）BHD. AEON BIG Co. （M）SDN. BHD. 1property

Overseas 27 SC 56 stores Overseas AEON Co.(M)BHD. 2 （ GMS/SM/DS only ） properties 2properties

（Note 1) Some of these stores are operating as tenants at SCs managed by AEON Mall or AEON TOWN. (Note 2) Excerpts from the supplements to the financial results of AEON CO., LTD for the fiscal period ended February 28, 2018 (excluding AEON Mall Co., Ltd. and AEON TOWN Co., Ltd.) and websites of respective companies. (Note 3) Excerpts from the data (for the fiscal period ended February 28, 2018) provided by AEON GLOBAL SCM CO. LTD. (Note 4) GMS, SM, DS, HC and SuC stand for General Merchandise Store, Supermarket, Discount Store, Home Center and Supercenter, respectively. 12 External Growth Strategy -AEON Group’s Diverse Retail Businesses-

Many potential pipelines held by the AEON Group.

Top sales in Japan Top sales in Japan Health & Wellness Developer Business Supermarket Business International Business Business

Net sales Approx. 335.0 billion yen Approx. 3.2 trillion yen Approx. 696.0 billion yen Approx. 418.0 billion yen （Note 1）

No. of stores Approx. 310 stores Approx. 2,180 stores Approx. 4,370 stores －（Note 1）

China AEON（CHINA）CO., LTD. AEON Stores (Hong Kong) Co., その他の Limited 主要企業 ASEAN AEON ASIA SDN.BHD. AEON（CAMBODIA）Co.,Ltd. AEON（Thailand）CO., LTD. AEON VIETNAM Co., LTD PT.AEON INDONESIA

AEON Mall Co., Ltd. AEON Co. （M）BHD. Pipeline The Daiei, Inc. AEON TOWN Co., Ltd AEON BIG Co. （M）SDN. BHD. support partners

（Note 1）Source:AEON REPORT 2018 13 External Growth Strategy -Investment Targets- Investment in very stable community infrastructure assets based on past track records.

Investment targets

Community infrastructure assets defined by AEON REIT Percentage of commercial facilities owned by the REIT in which tenants of the following respective categories operate 1 • A community platform that covers all daily needs by offering varieties of tenants that people visit repeatedly, with a grocery supermarket positioned as a core facility. Grocery • A facility that flexibly responds to changes in the needs for daily life and the 100% supermarket These commercial facilities feature ２ business environment by flexibly changing the composition of tenants, thereby many tenants that make people want to enabling continuous operation for a long period time down the road. visit compared to other facilities • A facility essential to communities that offers a place for community-based activities ３ in respective areas, secures lifelines when emergencies including natural disasters occur, and functions as a disaster prevention center. 100% 97.1% Amusement Restaurants Clinics 97.1% facilities (Frequency Low High of visits) Within the community 94.3% Hobby schools 51.4% Cinemas 48.6% Gyms

Outside the community Number of visitors to the commercial facilities (Note 1) owned by the REIT (2017) 7% Average number of 25% 1,00010 million万人以上 or more

visitors per facility 5005million万人以上 or more1,000 and less万人未満 than 10 million

Approx. 9 million 68% 3003 million万人以上 or more500 and万人未満 less than 5 million

(Note 1) Based on calculations for 28 large commercial facilities of 35 commercial facilities owned by the REIT, in which the number of visitors can be counted based on the same concept. Comprehensive自治体との包括連携協定 alliance agreements（防災・福祉・環境保全推進、商業・観光の振興） with local governments

Conclusion of agreements 100% (38 properties in Japan)

14 External Growth Strategy –Our Stance on the Acquisition of Properties- Top-class stores can be acquired through negotiated transactions in the respective communities.

AEON REIT’s stance on acquisitions Advantages through negotiated transactions with the AEON Group Acquire top-class stores that best respond to changes in the Properties can be acquired in better condition through negotiated business environment. transactions with pipeline support companies (Operating Acquire the most competitive stores results) in the respective communities

Good Ratio of negotiated transactions Investment Properties owned by targets AEON REIT Investment Corporation (Note 2) Only negotiated transactions negotiated 50％ 50％ transactions （17 properties ）（18 properties ） 100%

Sponsors Third 59% parties 41%

Poor Prime location Cities (Note 1) Regional areas （Note 3）based on number of Properties Held in city centers

Acquisition of respective Future Acquisition of different types communities’ top-class, large- Replacement of properties initiatives scale commercial facilities of urban commercial facilities

(Note 1) Cities refer to the three major metropolitan areas and ordinance-designated cities. (Note 2) Calculated on an acquisition price basis for 38 domestic properties owned by AEON REIT 15 Internal Growth - Investment for Expansion and Renewal - Implementation of effective investments to enhance the value of properties in collaboration with the AEON Group. Investment for expansion and renewals Maintenance and Measures to prevent the loss of interest enhancement of the in facilities operating for many years. Expected investment cycles competitiveness of Measures to stay prepared for entry of facilities new competitors Large-scale renewals: Roughly every six years Efforts to Efforts to achieve an increase in Expansion: Roughly every 10 years increase rents master lease-based rents

Initiatives taken so far Rent increases due to expansion and renewal Examples of major initiatives (annual amount) Examples of major 7th Fiscal Period （Millions of yen） initiatives in Morioka

Investment amount 790 million yen

Annual rent Up 57 million yen

Renewal at Kofu 12th Fiscal Period Showa

Investment amount 781 million yen 8th Fiscal Period 9th Fiscal Period 10th Fiscal Period 11th Fiscal Period 12th Fiscal Period 13th Fiscal Period ended January 2017 ended July 2017 ended January 2018 ended July 2018 ended January 2019 ended July 2019 Annual rent Up 50 million yen （Note）As of January 2019

Policy for future expansion and renewals

Properties included in the current plan (Note) Will continue to make effective investments that 2019 2020 2021 and beyond reflect the characteristics of targeted properties Two properties are Two properties are expected to be included. expected to be included. in collaboration with the AEON Group.

(Note) The expected numbers are subject to change in the future. 16 Internal Growth - Robust Matter Lease Agreement with the AEON Group -

Efforts to secure stable rent income on a medium- to long-term basis by making the most of AEON’s facility operation skills and master lease agreements.

AEON Group’s facility operation skills

Commercial facilities in the portfolio have been operating stably.

Operating Revenue at Master Lease Net Sales of End Tenants Occupancy Rate of End Tenants Companies

Approx. 100% stable Approx. 100% stable Approx. 100% stable

Sep-Nov 2017 Mar-May 2018 Sep-Nov 2018 Nov 2017 Feb 2018 May 2018 Aug 2018 Nov 2018 Sep-Nov 2017 Mar-May 2018 Sep-Nov 2018

Dec 2017-Feb 2018 Jun-Aug 2018 Dec 2017-Feb 2018 Jun-Aug 2018

Lease structure

Concluded long-term/fixed master lease agreements with Group companies. Occupancy rate of mater lease 100% (For details, refer to the next slide.) companies

Efforts to generate stable cash flow from rent on a medium- to long-term basis 17 Internal Growth—Lease Structure—

Concluded long-term/fixed master lease agreements with Group companies. Conceptual image of the lease structure.

Sublease Agreement (each tenant) Master Lease Agreement

Master lease Investment End tenant companies corporation Core tenant Core tenant AEON Group

General merchandise Amusement facilities / large specialty stores ・AEON MALL Co., Ltd. store ・AEON RETAIL Co., Ltd. ・AEON Hokkaido Co., Ltd. ・AEON KYUSHU Co., Ltd. Sublease rents Master lease rents Specialty store area in the mall ・AEON CO. (M) BHD.

Major specialty store categories ・Apparel ・Goods ・Services ・Gourmet eats/foods Outline of the Master Agreement Japan Overseas (Malaysia) Rent Cancellation conditions Rent In principle, the contract is not cancellable Fixed rent, Lease term: 20 years Fixed rent, Lease term: 10 years during the lease period. The amount equivalent to the fixed asset tax However, the contract may be terminated The rent changes every three years and city planning tax will be paid as additional subject to payment of a penalty fee according to the consumer price index. variable rent. (To be revised every year equivalent to six months’ rent on the day according to changes in the taxed amount.) following the final day of the non-cancellable term defined with respect to each property, aside from the rent term. 18 Introduction of Individual Property (AEON Mall Kurashiki)

Motivate people to visit the facility and contribute to the local community while continuing to change.

Diverse functions offered in the form of community infrastructure assets

Community contribution/community development Holding of many events to draw local

The Ogyatto, a fun childcare event for Strong trading area that creates an overwhelming large parents and children number of visitors Number of visitors in 2018: 12 million Population of Kurashiki City: 480 thousand (increasing from the year when the facility Cooperation with administration commenced operation) Concluded a disaster prevention agreement with the Kurashiki City government 120 Kurashiki City 110 100 90 Okayama Pref. 80 1999 2011 2018 Accepted evacuees when the 開業(OPEN)1999年増床(Expansion)2011年 2018(Present)年 Established a permanent Western Japan torrential rainfall administration service corner occurred in 2018 (Note 1) Number of visitors for March 2018 – February 2019 (Note 2) Indicated as indexes with population in 1999 treated as 100 Environmental friendliness Maintenance of appeal through expansion and Received DBJ’s Green Building Certification 2018 ★★★★★ revitalization (㎡) Number tenants (number of tenants) 90,000 250 increased by 1.26 times

80,000 200 Store area increased 70,000 by 1.17 times. 150 Planted 70,000 trees Solar panels 開業19991999年増床20112011年 20182018年 (OPEN) (Expansion) (Present)

19 Diversification of Lenders and Financing Methods (1)

Establishment of a strong bank and diversification of financing to respond to future business changes

Financial Management Rating

10th Period 11th Period 12th Period Credit rating agency Rating target Rating Outlook ended January ended July ended January Japan Credit Rating Long-term issuer AA- Stable 2018 2018 2019 Agency rating New borrowing ― amount (Note 1) ¥5.7 billion ¥27.0 billion Interest-bearing debt Breakdown of interest-bearing debts balance ¥150.0 billion ¥150.0 billion ¥150.0 billion Portion accounted for by Number of partners in the financial organization: 23 (Two banks, namely, The the balance of Yamaguchi Bank and The Gunma Bank, Ltd., were included in the previous ¥6.0 billion ¥6.0 billion ¥21.0 billion investment corporation fiscal period.) bonds investment Avg. number of years corporation remaining 4.2 years 3.7 years 4.6 years local bank, 7% bond Avg. cost of interest- 14% bearing debts 0.80% 0.80% 0.78% assurance Megabanks, LTV (incl. leasehold 44.9% 44.7% 44.9% company, 2% deposits) 41% leading bank, 6% Available capacity Approx. Approx. Approx. (up to 50%) ¥36.0 billion ¥37.0 billion ¥37.0 billion a government-controlled Note: Refinancing except bridge loans and debt financing for the purchase of new properties are included. bank, 8% Loan and trust Key Financial Indicators (as of January 2019) company, 22%

Ratio of long-term and Fixed interest rate ratio short-term Debts Diversification of Maturity Dates (as of January 2019) 4.3% 0% New debt financing Existing borrowings

(billions of yen) 3.0 5.0

4.0 22.0 15.6 16.1 17.2 15.4 9.3 15.0 95.7% 11.3 9.1 100% 1.0 2.0 1.0 2.0 1.0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2036 短期Short term 長期Long term Floating変動 rates Fixed固定 rates 20 Diversification of Lenders and Financing Methods (2)

Further extension of an average period remaining to maturity and reduction in costs

LTV Trend List of Lenders(as of January 2019) 50.0% Syndicate of lenders arranged by Mizuho Bank, Ltd., Sumitomo Mitsui Banking Corporation and Sumitomo Mitsui Trust Bank, Limited Numbers of Lenders 23 (+2 compared to previous period 46.0% Mizuho Bank 24,600 mil yen 19.1% 46.4% 46.7% Sumitomo Mitsui Banking 20,900 mil yen 16.2% 44.9% 44.7% 44.9% Sumitomo Mitsui Trust Bank 19,300 mil yen 15.0% 42.0% 42.8% 43.0% Bank of Tokyo-Mitsubishi UFJ 16,600 mil yen 12.9% 42.7% 38.9% 41.4% 41.4% 41.4% Norinchukin Bank 8,100 mil yen 6.3% Mizuho Trust ＆ Banking 6,700 mil yen 5.2% 38.0% Mitsubishi UFJ Trust and Banking (note 7th Fiscal 8th Fiscal 9th Fiscal 10th Fiscal 11th Fiscal 12th Fiscal 6,500 mil yen 5.0% 2) Period Period Period Period Period Period (July 2016) (January 2017) (July 2017) (January 2018) (July 2018) (January 2019) Resona Bank 3,500 mil yen 2.7% AEON BANK 3,600 mil yen 2.8% LTV (incl. leasehold deposits) LTV (excl. leasehold deposits) Development Bank of Japan 4,600 mil yen 3.6% Hyakugo Bank 2,400 mil yen 1.9% Interest-Bearing Debt Period remaining to maturity and our borrowing cost Hiroshima Bank 1,400 mil yen 1.1% Initial period remaining to maturity (on the right axis) Mie Bank 3,800 mil yen 2.9% 0.90% Average period remaining to maturity (year) 9.0 years 77 Bank 1,000 mil yen 0.8% Average of procurement interest rate (％) Chiba Bank 300 mil yen 0.2% 6.1 years 7.1 years Nippon Life Insurance 1,000 mil yen 0.8% 0.85% 6.6 years 6.4 years 6.6 years 6.6 years 7.0 years Meiji Yasuda Life Insurance 1,300 mil yen 1.0% The Daisan Bank 500 mil yen 0.4% 0.85% 0.84% 0.80% 5.0 years Shinsei Bank 1,300 mil yen 1.0% The Juroku Bank 300 mil yen 0.2% 0.80% 0.79% 0.80% 0.78% Momiji Bank 300 mil yen 0.2% 0.75% 3.0 years 4.1 years 4.7 years 4.4 years The Gunma Bank, Ltd. New! 500 mil yen 0.4% 4.2 years 4.6 years 3.7 years The Yamaguchi Bank, Ltd. New! 500 mil yen 0.4% 0.70% 1.0 years Total 129,000 mil yen 100.0% 7th Fiscal 8th Fiscal 9th Fiscal 10th Fiscal 11th Fiscal 12th Fiscal Note : As of April 16, 2018, Mitsubishi UFJ Trust and Banking Corporation’s corporate lending Period Period Period Period Period Period operations were transferred to The Bank of Tokyo-Mitsubishi UFJ, Ltd. through a company split. In accordance with this, the loan claims held by Mitsubishi UFJ Trust and Banking Corporation were (July 2016) (January 2017) (July 2017) (January 2018) (July 2018) (January 2019) succeeded to The Bank of Tokyo-Mitsubishi UFJ, Ltd. as of the same date. 21 Risk Management

Grew into a REIT resistant to unexpected disasters

Effects of distributions Measures in the 12th period 3,066 yen

1 Diversified investments Removed the impact of distributions through a range of measures Diversified investments to avoid concentration on particular Increase due areas and properties Extraordinary losses related to disasters: to improved 275 million yen performance Insurance money received (extraordinary profit): ＋56 yen 2 Coverage by fire insurance and 153 million yen earthquake insurance Reversal of distribution reserves:122 million yen Coverage by earthquake insurance for domestic properties Insurance amount for earthquake insurance: 3.0 billion yen 3,010 yen (deductibles: 100 million yen) Fire insurance covers storm and flood damages

３ eversal of Accumulation of distribution reserves distribution reserves Reserved 520 million yen in the 9th fiscal period. Extraordinary Insurance Measures can be taken if unpredictable events occur. losses related to money received +69 yen disasters (extraordinary profit) ▲155 yen +86 yen Initial当初予想 forecast Result実績 4 Strong cash flow Investment area Free cash flow of approximately 7.0 billion yen per year. (as of the end of the 12th fiscal period) Measures can be taken if unpredictable events take place. 23 prefectures and Malaysia (14 prefectures when listed) 22 Strategic cash management -Cash Generation Skills- A free cash flow of approximately 7.0 billion yen per year to be used as funds for the implementation of a range of strategies. Free cash flow for the respective fiscal periods (Note) (Millions of yen) Depreciation Capital Free cash flow Expenditures

Jan 2018 Period Jul 2018 Period Jan 2019 Period Jul 2019 Period Jan 2020 Period (Note) Free cash flow = Depreciation - Capital Expenditures Main track records on the utilization of cash External Internal Measures taken in Growth Growth relation to disasters Allocated partially to the acquisition of Renewal in Ota Distributions in excess of earnings for 写真 overseas properties the fiscal period ended July 31, 2016 3,052 million yen 199 million yen 1,898 million yen

Acquisition of the extended building Renewal in Suzuka at Kofu Showa 7,155 million yen 296 million yen 23 Financial Strategy - Implementation of Measures That Contribute to Growth in Distributions - Seek to maximize unit-holder value by considering the efficient utilization of funds.

A simulation on the result of fund utilization based on the assumption of using free cash of 5.0 billion yen

 Investment in newly acquired Acquisition of properties (i) If utilized for acquiring properties, Improvement properties  Boosting of revenues and (assuming the acquisition of a property whose NOI yield is 3.9% of competitiveness of existing properties after depreciation) profitability owned Increase of approx. 54 yen LTV remains Investment for  Contribution to the enhancement of per unit unchanged. revitalization unit-holder value through continuous value increasing efforts

 Reduction in the cost of debt (ii) If interest-bearing debt is utilized for repayment, LTV control (assuming the repayment of borrowings whose average interest  Enhancement in available capacity Stabilization is 0.8% per year.) of financial  Response to natural disasters and position unexpected events caused by Increase of approx. 11 yen Response to LTV decreases 0.77% natural disasters and payment of per unit unpredictable temporary expenses events

 Increased capital efficiency (iii) If utilized for unit buy-backs and depreciation Unit buy-backs  Will consider implementation if (assuming the implementation of unit buy-backs for the the P/NAV continues to be at a investment unit price of 106,771 yen (Note) and cancellation) Capital level significantly below one and (Note) An investment unit level that stands at 0.8 times per policy sufficient excess funds are 133,464 yen, or NAV per unit at the end of the 12th fiscal period. Distributions in available Increase of approx. 82 yen excess of LTV increases 0.63%. per unit earnings  Management of distributions

24 III. Forecasts of Performances and Future Objectives Financial Forecasts

Achieved the medium-term objective of distributing an ordinary dividend of approximately 3,000 yen.

12th Fiscal Period 13th Fiscal Period Ended July 2019 14th Fiscal Period Ended January 2020 Ended January 2019 Forecast Forecast Forecast vs. Previous Result vs. Previous Period vs. Forecast Announced on Mar. 14, 2019 Announced on Sep. 12, 2018 Announced on Mar. 14, 2019 Period (A) (B) (B-A) (C) (B-C) (D) (D-B) Operating Revenues (Millions of yen) 16,329 16,334 ① +5 16,331 ⑤ +3 16,335 -

Operating Expenses (Millions of yen) 9,993 10,186 ② +192 10,149 ⑥ +36 10,154 ⑧ ▲31

Operating Income (Millions of yen) 6,335 6,148 ▲187 6,181 ▲33 6,180 +32

Ordinary Income (Millions of yen) 5,448 5,333 ③ ▲115 5,318 ⑦ +14 5,333 -

Extraordinary income (Millions of yen) 152 - ④ ▲152 - - - -

Extraordinary Loss (Millions of yen) 274 - ⑤ ▲274 - - - -

Net Income (Millions of yen) 5,325 5,332 +6 5,313 +19 5,332 - Reversal of dividend (Millions of yen) reserves 122 - ⑥ ▲122 - - - - Distributions per Unit (yen) 3,066 3,000 ▲66 2,985 +15 3,000 -

NOI (Millions of yen) 11,553 11,423 ▲130 11,451 ▲28 11,435 +12 (Note) The number of investment units issued for each period is 1,777,347.

【13th term: Major factors of changes from the previous period】【13th term: Major factors of changes from the forecast】【14th term: Major factors of changes from the previous period】

No. Main items Amount (million yen) No. Main items Amount (million yen) No. Main items Amount (million yen) Rent income from extended properties Rent increase due to investment +47 +5 Repairs and maintenance expenses ▲14 (Full-period contribution) for revitalization ⑤ ① Income from dividends of overseas SPC Income from dividends of overseas SPC ⑧ ▲12 ▲2 Depreciation ▲23 (Exchange rate factors) (Exchange rate factors) Insurance revenue ▲27 Repairs and maintenance expenses +28 Fund costs +3 Taxes and dues for properties acquired +89 ⑥ Depreciation ▲12 Repairs and maintenance expenses +59 Fund costs +15 ② Depreciation +17 Loan related costs ▲106 ⑦ Fund costs +27 Investment corporation bond related costs +63 Loan related costs ▲65 ③ Investment corporation bond related costs +23 Depreciation of investment unit issuance expenses ▲31

④ Difference from income revenue posted in the pervious period ▲152

⑤ Difference from disaster factors reflected in the previous period +274

⑥ Reversal of reserves posted in the previous period ▲122 26 Activities to Achieve Sustainability - AEON Group and AEON REIT -

Will seek to take proactive actions in collaboration with the AEON Group

AEON REIT AEON GROUP  GRESB in 2018 Environment Obtained the Green Star for the third straight year  Planted 11.66 million tress (Cumulative number of trees planted at the end of February 2018)  Received DBJ’s certification for six properties AEON Mall Itami Koya  AEON Carbon-free Vision 2050 AEON Mall Mito Uchihara Will reduce CO2 emissions 35% by 2030 from the level in 2010 and achieve zero emissions by 2050. AEON Mall KYOTO AEON Mall Kurashiki  Reduction in food disposals AEON Mall Nogata Will collaborate with stakeholders including customers and create a resource-recycling society. AEON Mall Morioka Society  Received CASBEE certification for two properties  AEON 1% Club Foundation AEON Mall Yamatokoriyama Promote initiatives aimed to develop the next generation, promote friendships with foreign countries and sustain the development of local communities (succession of cultural heritage) AEON Mall Kagoshima  MSCI Japan ESG Select Leaders Index  AEON Environmental Foundation Included from 2017 Promote efforts to plant trees, preserve biodiversity and develop human resources in the environmental field. Indicator selected as an ESG indicator index for GPIF’s passive investments Disaster prevention  Agreements on disaster prevention  Corporate Governance Code Concluded agreements with more than 850 local Established the code of an asset management company governments and private companies nationwide. ahead of other companies in March 2016  Collaboration with external parties Collaboration with the Self Defense Force and Japan Airlines in case of an emergency.

27 Future Growth Objectives Will steadily implement growth strategies by leveraging strong, free cash flows and aiming to achieve an ordinary dividend of 3,300 yen. Summary of growth strategies  Implement selected investments from many pipelines in the AEON Group via negotiated transactions External Growth  Acquire top-class stores in each area that are resistant to changes in the business environment

 Maintain and enhance the competitiveness of facilities through the Group’s collaborative implementation of effective investments Internal Growth  Achieve not only stable rents through matter lease agreements but rent increases through revitalization

 Facilitate the diversification of financing methods to respond to changes in the business environment in the future Financing policy  Further stabilize financial management through efforts to extend and fix the term of interest-bearing debt Growth objectives

Ordinary distributions Asset size

Seek to expand the asset size steadily by making Aim to meet the medium-term objective through a selected investments in response to market range of measures by leveraging strong cash flows. conditions. As of the end of As of the end of the12th fiscalperiod 500.0 the12th fiscal period 3,300 yen billion yen 362.4 billion yen 3,000 yen

(Note) The Asset Management Company does not guarantee the amounts presented as ordinary distributions and asset size, which are management targets set by the Company. 28 Messages from the Management Team

Yasuo Shiozaki Message from Representative Director. President and Representative Director

Career in brief Five years have passed since AEON REIT was listed in November 2013. Mr. Shiozaki joined Jusco Co., Ltd. (currently, AEON Thanks to your support, we recorded successful results for the 12th fiscal Co., Ltd.) in 1977. He engaged in real estate-related period. operations for approximately 25 years while Despite many natural disasters such as earthquakes and typhoons during the developing his career at AEON Kosan Co., Ltd. (currently, AEON Mall Co., Ltd.) and Rock period, we achieved distribution of 3,066 yen per unit, which was 56 yen Development Co., Ltd. (currently, AEON TOWN Co., higher than the 3,010 yen expected at the end of the previous period. Ltd.). He has extensive experience in sales and AEON REIT has been implementing various measures including earthquake brokerage services, in addition to his current insurance to prepare for the risk of natural disasters. In addition, it succeeded assignment that he has been engaged in since the in enhancing revenues through the acquisition of the extended building at dawn of the securitization of domestic real estate at Kofu Showa and reducing financing costs through the refinancing and the beginning of 2000. Mr. Shiozaki was appointed issuance of retail bonds. Going forward, the Company will continue to President and Representative Director of the manage its assets to achieve stable distributions on a medium- to long-term Company in May 2016, after engaging in asset management-related assignments as Director of the basis. Company, a position that he took on August in 2012. Your continued support is greatly appreciated.

Director Director Director Nobuaki Seki Tetsuya Arisaka Yasushi Ogusu

In charge of Investment In charge of Business Compliance Officer Management Department. Administration Department., General Manager of and Asset Management Accounting Department. Compliance Department. Department. and Financial and Planning Department.

Career in brief Career in brief Career in brief Mr. Seki joined Juso Co., Ltd. (currently, AEON Co. Ltd.) in Mr. Arisaka joined The Dai-Ichi Kangyo Bank, Ltd. (currently, Mr. Ogusu joined The Fuji Bank Limited (currently, Mizuho Bank, 1988. He was seconded to JAYA JUSCO STORES (currently, Mizuho Bank, Ltd.) in 1983. He engaged in a range of Ltd.) in 1984. He engaged in a variety of assignments such as AEON Malaysia) in 1995. Since 2000, Mr. Seki engaged in the assignments including corporate financing, fund and exchange financing for U.S. and domestic real estate properties, corporate management of the Group’s overseas companies and transactions, foreign bond transactions, market planning and sales for large real estate companies and auditing of operations. assignments related to Asian businesses and developer asset management. After developing his career through services He took on the position of the manager of IR and planning business strategies. He became deeply involved in the at the bank’s Hong Kong and New York branches and as the group of Finance and Planning Department at the Company in establishment of AEON Reit as an Auditor and a Director of the assistant general manager of the International currency 2012. He played a leading role in the establishment of IR Company in 2012 and 2013, respectively. After gaining his exchange division, general manager of the North America office operations even before the Company was listed. He assumed career as an Executive Officer of AEON Retail Co., Ltd. while of Global Alternative Investment Management division, and the position of Compliance Officer and general manager of concurrently serving as the General Manager of Developer general manager of the risk control operation division, Mr. Compliance Department, and became Director of the Company Department and General Manager of President’s Office, he was Arisaka took on the position of Compliance Officer and the in 2016. appointed Director of the Company in 2018. general manager of Compliance Department at the Company in 2012. He was appointed Director of the Company in 2015.

29 Appendix １ Characteristics of AEON REIT AEON Group Profile

Seven businesses promoted by the AEON Group to AEON expanding into 14 countries globally (Note 2) support people’s daily lives (Note 1)

●International Business 4.7% ●Service/Specialty Store Business Korea 8.6% AEON Group across Japan Asia and the world ●Shopping Center ●GMS Business 34.4% China Laos

Development Myanmar Vietnam Business 3.7% India Philippines ●General Financing Operating Revenue Cambodia Business 4.5% Thailand 8.39 trillion yen Malaysia Singapore ●Drugstore/Pharmacy Business Total 21,742 stores/facilities 7.8% ●GMS 584 stores ●SM 2,185 stores ●SM Business 36.1% ●DS 568 stores ●HC 122 stores Indonesia ●CVS 5,436 stores ●Specialty stores 4,324 stores ●Others 938 stores ●Mall-style SC 311 facilities ●NSC 162 facilities ●Financing 690 facilities AEON’s Top salesbusiness ●Service 2,045 facilities ●Drugstores 4,376 stores (Note 1) ● domains Tasmania Ranch operated directly by AEON 1 facility Australia ● Sales from general merchandising stores: 3.1 trillion yen Continuous growth of the AEON ● Sales from grocery supermarkets: 3.2 trillion yen Group ● Operating revenue from domestic shopping centers: 288.0 billion yen Aim to achieve 10 trillion yen and 340 billion yen in operating revenue and operating income, respectively, by 2020.(Note 2) 8.70 trillion yen Record high revenue for 8.39 trillion yen 8 consecutive fiscal periods

●GMS Business ●SM Business ● General Financing Business

1010 trillion兆円 yen

●Service/Specialty Store ● International ●Health & Wellness ●Shopping Center Business Business Business Development Business

(Note 1) Business compositions, sales and operating revenues are quoted from the AEON Report 2018. Fiscal period (Note 2) The number of stores, operating revenues in the medium-term management plan and operating income targets are quoted from the AEON Report 2018. Medium-term management plan 31 AEON Group’s Rankings

Retailer rankings by total domestic operating revenue in 2017 Top 15 retailers by global sales in 2017

Company name Total operating earnings Company name Headquarters Sales 1 AEON 8,390,012 1 Walmart Stores USA 495,761 2 Seven & i Holdings 6,037,815 2 CVS Health USA 184,765 3 Fast Retailing 1,861,917 3 Amazon.com USA 177,866 4 Yamada Denki 1,573,873 4 Costco USA 126,171 5 Family Mart UNY Holdings 1,275,300 5 Kroger USA 122,662 6 Isetan Mitsukoshi Holdings 1,268,865 6 Walgreens Boots Alliance USA 118,214 7 Takashimaya 949,572 7 Schwarz Gruppe Germany 116,312 8 H20 Retailing 921,871 8 The Home Depot USA 100,904 9 Don Quijote Holdings 828,798 9 ALDI Germany 99,870 10 Bic Camera 790,639 10 Carrefour France 94,714 11 Tesco UK 77,690 (Note) Prepared by the Asset Management Company based on an article in the January 2019 issue of the Hanbai Kakushin, an industry magazine. Earnings are indicated 12 AEON Japan 77,458 in millions of yen. Figures for Fast Retailing and Don Quijote Holdings show earnings in FY2017/8 and FY2017/6, respectively. Figures for the other companies 13 Ahold Delaize The Netherlands 75,478 show earnings in either FY2018/12 or FY2018/3. 14 Target USA 71,879 15 Lowe’s USA 68,619

(Note) Prepared by the Asset Management Company based on an article in the January 2019 issue of the Hanbai Kakushin, an industry magazine. Sales are indicated in millions of dollars.

32 Realization of Growth Strategies through Collaboration with AEON Group

● Major Shopping Centers developed by AEON Group ● Major Shopping Centers currently under development by AEON Group

Tokai and Hokuriku Chugoku and Shikoku ● AEON MALL Takaoka Takaoka-shi, Toyama ●AEON MALL Tottorikita Tottori-shi, Tottori ● AEON MALL Tonami Tonami-shi, Toyama ● AEON Matsue Shopping Center Matsue-shi, Shimane ● AEON MALL Shin-Komatsu Komatsu-shi, Ishikawa ● AEON MALL Izumo Izumo-shi, Shimane ● AEON MALL Kakamigahara Kakamigahara-shi, Gifu ● AEON MALL Okayama Okayama-shi, Okayama ●(tentative name) AEON MALL Toki Toki-shi, Gifu Hokkaido and Tohoku ● AEON MALL Hiroshima Fuchu Aki-gun, Hiroshima ● AEON MALL Hamamatsuichino Hamamatsu-shi, Shizuoka ● AEON MALL Around Asahikawa Station Asahikawa-shi, Hokkaido ● AEON MALL Hiroshima Gion Hiroshima-shi, Hiroshima ● AEON MALL Odaka Nagoya-shi, Aichi ● AEON MALL Shimoda Kamikita-gun, Aomori ● THE OUTLETS HIROSHIMA Hiroshima-shi, Hiroshima ● AEON MALL Nagoya Chaya Nagoya-shi, Aichi ● AEON MALL Moriokaminami Morioka-shi, Iwate ● AEON Town Houfu Hofu-shi, Yamaguchi ● AEON MALL Fuso Niwa-gun, Aichi ● AEON MALL Natori Natori-shi, Miyagi ● AEON MALLTokushima Tokushima-shi, Tokushima ● AEON MALL Tokoname Tokoname-shi, Aichi ●(tentative name) AEON MALL Rifu ● AEON MALL Takamatsu Takamatsu-shi, Kagawa ● AEON MALL Nagakute Nagakute-shi, Aichi (New Building) Rifu-cho,Miyagi ● AEON MALL Niihama Niihama-shi, Ehime ● AEON MALL Toin Inabe-gun, Mie ● AEON MALL Akita Akita-shi, Akita ● AEON MALL Imabarishintoshi Imabari-shi, Ehime ● AEON MALL Tsu minami Tsu-shi, Mie ● AEON MALL Tendo Tendo-shi, Yamagata ● AEON MALL Kochi Kochi-shi, Kochi ● Shopping Mall Festa Koriyama-shi, Fukushima ● AEON MALL Iwakionahama Iwaki-shi, Fukushima Kyushu・Okinawa ●(tentative name) The project Kitakyushu-shi, Fukuoka Kanto and Koushinetsu of Yahatahigashida ● AEON MALL Tsukuba Tsukuba-shi, Ibaraki ●AEON MALL Fukuokaito Fukuoka-shi, Fukuoka ● AEON MALL Sanoshintoshi Sano-shi, Tochigi ● AEON MALL Fukutsu Fukutsu-shi, Fukuoka ● AEON MALL Takasaki Takasaki-shi, Gunma ● AEON MALL Yahatahigashi Kitakyushu-shi, Fukuoka ● AEON MALL Urawamisono Saitama-shi, Saitama ● AEON MALL Sagayamato Saga-shi, Saga ● AEON MALL Hanyu Hanyu-shi, Saitama ● AEON Daito Shopping Center Sasebo-shi, Nagasaki ● AEON MALL Kasukabe Kasukabe-shi, Saitama ● AEON Yatsushiro Shopping Center Yatsushiro-shi, Kumamoto AEON MALL Iwakionahama ● AEON MALL Yono Saitama-shi, Saitama ● AEON MALL Sankoh Nakatsu-shi, Oita ●(tentative name) AEON MALL Ageo Ageo-shi, Saitama ● AEON MALL Miyazaki Miyazaki-shi, Miyazaki ● AEON MALL Makuhari New City Chiba-shi, Chiba ● AEON MALL Okinawa Rycom Nakagami-gun, Okinawa ● AEON MALL Kisarazu Kisarazu-shi, Chiba ● AEON MALL Tamadairanomori Hino City-shi, Tokyo ● AEON MALL Hinode Nishitama-gun, Tokyo ● AEON Hadano Shopping Center Hadano-shi, Kanagawa ●(tentative name) AEON MALL Hiratsuka Hiratsuka-shi, Kanagawa ● AEON MALL Zama Zama-shi, Kanagawa ● AEON MALL Nigataminami Nigata-shi, Nigata ● AEON MALL Sakudaira Saku-shi, Nagano ● AEON MALL Matsumoto Matsumoto-shi, Nagano

AEON MALL Tsu minami

Kinki ● AEON MALL Osaka Dome City Osaka-shi, Osaka ● AEON MALL Kusatsu Kusatsu-shi, Shiga ● AEON MALL Shijonawate Shijonawate-shi/Neyagawa-shi, Osaka THE OUTLETS ● AEON MALL Kyotogojo Kyoto-shi,Kyoto ● AEON MALL Sakaiteppoucho Sakai-shi, Osaka HIROSHIMA ● AEON MALL Kyoto Katsuragawa Kyoto-shi/Mukou-shi, Kyoto ● AEON MALL Kobeminami Kobe-shi, Hyogo ● AEON MALL Rinkusennan Sennan-shi, Osaka ● AEON MALL Kashihara Kashihara-shi, Nara ● AEON MALL Dainichi Moriguchi ● AEON MALL Wakayama Wakayama-shi, Wakayama (Source) Prepared by the Asset Manager based on the information provided by AEON CO., LTD. and AEON Mall Co., Ltd. (as of Jan. 2019). Note: AEON REIT neither owns nor plans to acquire any of these properties as of now. 33 Reforms Undertaken by the AEON Group

Regional Shift Program Digital Shift Program

SM reform — Top-selling companies by area after the integration of the Increase the percentage of online sales by 17 times (0.7% Investment in BOXED AEON SM business in FY2016 to 12% in FY2020). Group company name Sales Area (after integration) Utilize automated AEON Hokkaido 1,860 (i) Raise net sales through online supermarkets. distribution systems and Hokkaido area (ii) Increase the total monetary amount of items sold in the marketplace data management as well MaxValu Hokkaido 1,240 business. as AI technologies for (iii) Facilitate sales through the transfer of customers from online stores online shopping. MaxValu Tohoku 1,030 to brick and mortar stores or vice versa. Tohoku area (Increase sales at brick and mortar stores by making online promotional efforts and AEON Retail Tohoku 980 featuring smartphone coupons)

MaxValu Tokai 2,170 Receiving items purchased online Tokai & Chubu area Marketplace at brick and mortar stores. MaxValu Chubu 1,720 Local parties who open shops and sell products Provision of Daiei 2,800 Kinki area in the marketplace information Kohyo 1,120 MaxValu Nishinihon 2,690 Chugoku & Shikoku Marunaka 1,780 Financing/Payment Shopping area Sanyo Marunaka 1,220 AEON Kyushu 2,140 MaxValu Kyushu 1,750 Kyushu area Asia Shift Program AEON Store Kyushu 540

Facilitate manufacturing and retailing of food products and respond to needs for ready-to-eat or semi- Increase the percentage of operating income by 3.8 times AEON Financial Service cooked foods against the backdrop of an increase in the number of the elderly and working women. in Asia (6% in FY2016 → 23% in FY2020). Offer multiple options to target customers by strengthening product and Accelerate a local-oriented management style to better service lineups. GMS reform – Make operation more professional and locally-oriented through the address needs in respective countries. establishment of specialized companies Acquisition of customers in different Area Priority measures income groups. Spin off the food business to regional Process Center companies. Concluded a memorandum with the Hanoi municipal government. Vietnam Establish specialized companies for clothing, Development of large-scale shopping housing/leisure and HBC, respectively. centers. AEON DELIGHT Efforts to further promote Halal-certified Promote small and urban-style stores. Indonesia products, among other products. Customize Japanese-style services to Efforts to increase the number of stores in suit local needs. China Build a Process Center and open stores mainly in that vicinity. Guangzhou.

Investments totaling 500 billion yen will be made in IT, digitalization and Investment Shift Program logistics (200 billion yen have been invested over the past three years).

(Note) Prepared based on websites and explanatory materials of AEON Group companies. 34 Expansion of Network of Support -Agreement Companies Support agreement signed with 11 companies in the AEON Group in order to utilize the collective strengths of the Group

AEON REIT Investment Corporation AEON Reit Management Co., Ltd.

Stable portfolio growth over the medium-to-long term

Sponsor support Pipeline support agreements Memorandum of agreement understanding on investments in Trademark license Shopping center Logistics facilities properties in Malaysia agreement management agreements management agreement

Major terms of such agreements Pipeline support companies Pipeline support company Overseas support Sponsor Logistics facilities Shopping center companies management providers management support company ⚫ Provision of information on properties owned AEON Mall Co., Ltd. AEON GLOBAL SCM AEON Co., LTD. AEON CO.(M) BHD. CO.,LTD. AEON Retail Co., Ltd. ⚫ Grant of preferential negotiation rights on the retail properties AEON Hokkaido AEON BIG (M) SDN.BHD. operated by AEON Group Corporation

AEON KYUSHU CO., LTD. ⚫ Provision of information on potential sales of properties AEON RYUKYU CO., LTD. owned by third parties

AEON TOWN Co., Ltd.

The Daiei, Inc.

Integrated AEON Group’s capabilities

35 Basic Philosophy and Basic Policy

Basic Philosophy AEON REIT positions retail properties as the infrastructure assets of local communities and invests in those properties to support the rich life of people living there.

AEON REIT aims to create a rich life for people and contribute to local communities through investment activities and implements stable asset management on a medium- to long-term basis.

(Note) Refers to retail properties, logistics facilities and related facilities. Retail properties refer to facilities containing retail businesses and other merchandising businesses, entertainment and amusement facilities and other facilities that attract customers (including parking lots and equipment and systems for logistics). Logistics facilities refer to warehouses and other storage facilities for the distribution and transport of merchandise and other goods.

Basic Policy AEON REIT carries out a growth strategy based on the policy of maintaining a mutually beneficial relationship with the AEON Group (Note), thereby aiming to maximize value for unitholders.

(i) Sell retail (iii) Increase distribution and improve (i) Acquire retail properties properties to the REIT (ii) Make growth investments by unitholder value from the AEON Group leveraging funds obtained from property sales

(iii) Increase revenues and (ii) Expand the asset size, make asset management enhance corporate value more stable and improve financing capabilities

(Note) Refers to the group comprised of the holding company AEON CO., LTD. and its 291 consolidated subsidiaries and 31 equity-method associates (as of February 28, 2018).

36 Portfolio Policy

Investment ratio (Note 1) Type Domestic Overseas 85% or more No more than 15% (i) Super regional shopping center (SRSC) : More than one anchor tenant with over 200 specialty stores Large-scale retail (ii) Regional shopping center (RSC) : A large GMS with over 50 specialty stores 80% or more property (iii) Community shopping center (CSC) : A GMS, discount store and large grocery store with 20 to 50 specialty stores

Neighborhood shopping center (NSC) : A grocery store with 10 – 30 specialty stores Other retail property No more than 20% (Small- and medium-scale) Supermarket (SM) : A grocery supermarket with a focus on the selling of high purchase frequency commodities, such as food and household good

Logistics facility : Logistics facilities that support a supply chain, an integral part of the retail business No more than 10%

Overseas investment areas Overseas investment targets Countries and regions with strong economic growth Retail properties leased to and managed and operated by prospects in the medium to long term, such as Malaysia in the AEON Group comprehensively, in principle, under (Note 2) the ASEAN region and China master lease contracts

AEON MALL Mitouchihara (Super regional shopping center)

Anchor tenant

Mall area Anchor tenant (Specialty store area)

(Note 1) Calculated based on acquisition prices. (Note 2) Indicates Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Laos, Myanmar and Cambodia. 37 Lease Structure (Conceptual Image of Capital Flows) The AEON Group’s stable management of properties supports the stable payment of distributions.

End tenants: Sales

Anchor tenants Other specialty stores

Fixed and variable rents

Master lessee: Rent income

Fixed rent (Note)

AEON REIT: Operating revenue

Rental and operational expenses, etc.

(Note) The amount equivalent to the fixed asset tax Distributions and city planning tax will be paid as additional variable rent.

38 Strategic Cash Management and a Stable Financial Position

In the large-scale retail properties that we target for investment, the depreciation expense accounts for a large percentage of the property value. The percentage of depreciation expenses in a real estate price tends to be higher than office buildings and distribution facilities due to a shorter period of depreciation in accounting. By deploying internal reserves in an amount equal to the depreciation expense, we plan to increase capital efficiency and stabilize cash flow.

Appropriation of funds to acquire new properties Investment contributing to an increase in income Investing in revitalization of property to boost revenues and competitiveness

Growth Measures aimed at stabilizing Reduction in the cost of our debt by repayment of driven by financial position interest-bearing debt efficient use of capital Distributions in excess of earnings Capital strategies that protect unitholder interests Increased capital efficiency through unit buy-backs

Response to natural disasters and unexpected events Response to other caused by natural disasters, payment of temporary unpredictable events expenses, etc.

39 Trends in Results for Five-Year Period After Listing

Asset size has been growing steadily and distributions have been paid stably since the REIT was listed.

Billions of yen Asset size

400.0 355.1 355.3 362.4 330.6

300.0 268.5 249.2

194.3 194.3 200.0 158.3 158.9 158.9

100.0

0.0 2nd Fiscal 3rd Fiscal 4th Fiscal 5th Fiscal 6th Fiscal 7th Fiscal 8th Fiscal 9th Fiscal 10th Fiscal 11th Fiscal 12th Fiscal Period Period Period Period Period Period Period Period Period Period Period

2nd Fiscal 3rd Fiscal 4th Fiscal 5th Fiscal 6th Fiscal 7th Fiscal 8th Fiscal 9th Fiscal 10th Fiscal 11th Fiscal 12th Fiscal Period Period Period Period Period Period Period Period Period Period Period Distributions per unit 686 2,461 2,473 2,724 2,790 1,450 3,019 2,926 3,029 2,956 3,066 (yen) NAV per Unit 110,456 112,635 115,939 122,057 126,169 123,547 127,912 127,358 128,301 130,957 133,464 (yen) Net assets per unit 102,108 103,883 103,896 109,536 109,603 107,959 109,528 111,457 111,445 111,372 111,413 （yen) Depreciation 1.1 2.2 2.2 2.6 2.6 3.1 3.3 4.1 4.3 4.3 4.4 （billions of yen)

40 Initiatives leveraging AEON REIT’s strengths①

Acquired properties from AEON Malaysia, which has been operating locally for more than 30 years. Rents are CPI-linked, reflecting Malaysia’s growth potential. Overview of Malaysia Overview of AEON Malaysia (AEON Co. (M) BHD) ✓ Has been operating business in Total net sales of AEON Co. (M) BHD  The GDP per capita increased approximately 2.3 times compared to the level in 2000 and is Malaysia for more than 30 years, 4,500 (Millions of RM) expected to continue growing sharply going has established a solid position as a forward. retailer, and has knowledge of laws, 4,000 taxation, accounting, etc. related to  The median age is 28.6 years. The young 3,500 generation and working-age people account real estate. for more than 90% of the population. ✓ Is therefore able to purchase 3,000 Population 32,020,000 properties after verifying adequate 2,500 track records. Approx. 330,000 km2 FY2013 FY2014 FY2015 FY2016 FY2017 Area (approx. 90% of the area of Source：SPEEDA Japan) Properties held by AEON REIT in Malaysia GDP per capita $9,755 AEON Taman Universiti (nominal) AEON MALL Seremban 2 Shopping Centre Property name Changes in CPI in Malaysia and Japan Age composition

Acquisition 20 million RM 215 million RM 6.5% price 145 Appraisal 21.3 million RM 233 million RM 135 23.8% value Date of 125 CPI(Malaysia) 2002年 2005年 CPI(Japan) completion 115 Appraised 69.7% 7.2% 6.8% 105 NOI yield Achieved an increase in monthly 95 Topics rent of 7.35% over current rent 85 0-014-14歳 1515--6464歳 6565歳以上 linked to CPI years years years old 75 Outline of Master Lease Agreement

old old and over

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

2000 Fixed rent agreement CPI-linked rent revision Net lease

2018E 2019E 2020E 2021E 2022E 2023E (10-year lease term) (every 3 years) * Only AOEN MALL Seremban 2 Source：IMF - World Economic Outlook Databases Source：Department of Statistics Malaysia 41 Initiatives leveraging AEON REIT’s strengths② - Logistics facility -

Invested in logistics facilities, an integral part of commercial distribution. Currently owns three properties. Seeks to incorporate growth potential and profitability in the Group’s overall supply chain.

Customers Stores Logistics facility

community infrastructure assets

type merchandise function Kanto Region Kansai Region

Fresh food processing center Production and processing of fresh food Process Center Fresh food that can not be processed in each store and supply raw materials for cooking at Daiei-Kawasaki Daiei-Ibaraki each store Process Center Process Center Inventory storage base Mainly as a room temperature facility, Regional Distribution High rotation responsible for temporary storage and Center products supply of goods frequently replenished at AEON Minami-Osaka each store RDC

42 Initiatives leveraging AEON REIT’s strengths③ - property replacement and acquisition of the extended building - Improved portfolio quality with the replacement of properties and acquisition of the extended building of a property owned by the REIT.  Acquisition of AEON MALL Kyoto Gojo  Acquired the extended building at Kofu Showa

Asset replacement Extended building AEON MALL Kumamoto AEON MALL Kyoto Gojo

⚫ Acquisition of complete ownership of land in Kyoto, ⚫ Converted the property into the area’s overwhelmingly where land is scarce Number One mall in terms of both floor area and the ⚫ Located in a populated housing area in Kyoto City number of tenants. whose population of trading area is approx. 340,000 in the 3-kilometer area with a high market density ⚫ Sales rose 1.6 times at specialty stores after the acquisition of the extended building.

Neighborhood-based Commercial Facilities Store areas in the 10 km trading area Before expansion After expansion Kofu甲府昭和 showa 46,222 Kofu 甲府昭和showa 69,583 Commercial Commercial 商業施設A 商業施設A facility A 32,044 facility A 32,044 Commercial商業施設B 22,582 Commercial商業施設B 22,582 facility B facility B 0 25,000 50,000 75,000 0 25,000 50,000 75,000

（Source） Prepared by the Asset Manager based on the market report prepared by BAC Urban Projects Co.,Ltd..

Food sales area, Kyo-Deli, selling fresh food Parking lots for approx.2,000 bicycles Provided by local companies For the large local population 43 Portfolio Highlights (as of January 31, 2019)

Summary of Portfolio

Number of properties 40

Total acquisition price ¥362.4bn

Portfolio appraisal NOI yield before depreciation 6.4%

Portfolio appraisal NOI yield after depreciation 3.9%

Average remaining lease term 16.2 years

Average building age 14.7 years

Total leasable area 3,430,000m²

Occupancy rate 100% Portfolio Data

By property type By location

北海道・東北Hokkaido・Tohoku 8.7%

関東Kanto 34.8% ■SRSC 7.7％ (Super regional shopping cente)r Tokai東海・北陸・中部・Hokuriku・Chubu 12.6% ■RSC 79.7％（Regional shopping center）近畿Kinki 26.1% ■CSC 4.0％（Community shopping center）中国・四国Chugoku・Shikoku 9.5% ■L 8.5％（Logistics facility）九州・沖縄Kyushu・Okinawa 6.8%

マレーシアMalaysia 1.6%

44 Portfolio Map (as of January 31, 2019)

Hokkaido and Tohoku 40properties(domestic38, overseas2） SRSC: Super regional shopping center RSC: Regional shopping center Asset Size ¥362.4bn CSC: Community shopping center Logistics facility Tokai, Hokuriku and Chubu 16 17 1 AEON MALL 2 AEON MALL 16 AEON MALL 17 AEON MALL Morioka Ishinomaki Sapporo-Hiraoka Kushiro-Showa 24

AEON MALL 29 6 AEON MALL 7 Ogaki Suzuka 18 AEON MALL 19 AEON MALL 24 AEON MALL Rifu Yamagata-Minami Tomakomai Kanto

1 AEON MALL 8 20 AEON MALL Meiwa Yokkaichi-Kita 23 6 2 19 18 AEON Lake Town AEON Lake Town AEON MALL 20 1 2 3 4 AEON MALL mori kaze Mitouchihara Ota 7 AEON MALL 23 29 AEON MALL 8 Kofu Showa Kahoku

Kyushu and 10 AEON Sagamihara AEON MALL AEON Chigasaki-Chuo Daiei-Kawasaki Okinawa 5 22 1 1 Shopping Center Chiba-New Town Shopping Center Process Center （Mall, Cinema and Sports building) 9 31 15 11 26 3 12 3 21 2 13 AEON MALL AEON MALL 13 27 Nogata Kagoshima 25 AEON MALL Oyama 28 AEON MALL Tsuchiura AEON MALL Shimotsuma AEON STYLE Malaysia 30 2 Kemigawahama Kinki, Chugoku and Shikoku 25 4 27 3 30 28 1 M - 1 M - 2 2 AEON Taman AEON MALL Universiti Shopping SEREMBAN 2 22 AEON MALL AEON MALL AEON MALL AEON Kireuriwari Centre 9 10 AEON MALL 11 26 3 Kasai-Hojo Hiezu Kurashiki Itamikoya Shopping Center 2

● M - 2 5 1 ● M - 1 1

ASEAN region Daiei-Ibaraki 31 AEON MALL 12 AEON MALL 15 AEON MALL 21 AEON MALL 2 AEON 3 Kyoto Gojo Ayagawa KYOTO Yamatokoriyama MINAMI-OSAKA RDC Process Center 45 Trend of Investment Unit Price

AEON REIT Investment Unit Price and Trading Volume

(Yen) (Units) Trading Volume (Right axis) AEON REIT Investment Unit Price (Left axis) 190,000 50,000

180,000

40,000 170,000

160,000

30,000 150,000

140,000 20,000

130,000

120,000 10,000

110,000

100,000 0

Nov 2013 Feb2014 May 2014 Aug2014 Nov 2014 Feb2015 May 2015 Aug2015 Nov 2015 Feb2016 May 2016 Aug2016 Nov 2016 Feb2017 May 2017 Aug2017 Nov 2017 Feb2018 May 2018 Aug2018 Nov 2018

46 Framework for Maximizing Unitholder Value

Transparent Decision-Making Process Disapproved

Dropped or instructions Returned given to modify content

Deliberation and Drafting of proposal Deliberation and Approval by Report to the Asset Approval by the resolution by the by the responsible resolution by the Investment Manager’s board of Compliance Officer Investment department Compliance Corporation directors Committee* Committee*

Dropped or instructions given to modify content * An outside expert must attend the meeting and agree in order for the resolution to pass. Introduction of an Asset Management Fee Structure Linked to Further Aligning the Interests of Unitholders and the AEON Group Distributions per Unit • Ownership of investment units by AEON Group Management Fee Structure Calculation Method Ownership interest 19.8％ (as of January 31, 2019)

Manage- ment fee I Total assets × 0.3% (maximum rate)× {No. of operating days / 365} • Co-ownership of properties with AEON Group Management fee Co-owned properties 3 (as of January 31, 2019) Manage- DPU(Note1) before deducting Management fee II × NOI(Note2) × 0.001% ment fee II (maximum rate)

Introduction of Cumulative Investment Unit Purchase Program Acquisition fee Acquisition price × 0.5% (maximum rate) [Related party transactions: Acquisition price × 0.25%(maximum rate) ] • We introduced a program on May 1, 2014, that enables the acquisition of AEON REIT’s investment units, using the cumulative investment unit purchase program through securities firms, for directors and employees of AEON REIT and the Asset Disposition fee Disposition price × 0.5% (maximum rate) Manager. [Related party transactions: no disposition fee paid]

• The program will help to further raise awareness towards enhancing the value of (Note 1) Total assets are calculated by subtracting the amount of capital contributions, etc. related to the overseas real estate AEON REIT’s investment unit price and improving business performance, and holding corporation from net assets recorded on the balance sheet for the fiscal period directly preceding the relevant operating period and then adding the total assets of the overseas real estate corporation to the balance. provide greater financial motivation in line with the interests of the unitholders. (Note 2) NOI refers to total real estate leasing revenues for the relevant fiscal period less real estate leasing expenses (excluding depreciation and loss on retirement of non-current assets) 47 Practice of Strategies to Grow with Retail and Related Properties of AEON Group

AEON REIT will aim to achieve steady portfolio growth over the medium-to-long term by fully utilizing AEON group’s comprehensive strengths - Developing, leasing, operating and managing AEON group’s various types of retail properties etc. Portfolio formation mainly led by large-scale retail properties Implementation of new redevelopment strategy cooperating with Sponsor Group Expecting to realize internal growth by establishing WIN-WIN relations ◼ AEON Group’s large-scale retail properties Large-scale ◼ Internal growth utilizing Sponsor’s know-how (abilities of retail properties development – top-class regional retail properties with Numerous retail properties & operation). competitive advantage. specialty stores ◼ Contributing to NOI increase without taking risk to attract tenants in re-development. ◼ Large-scale retail properties can deal with GMS, Dept. stores ◼ Implementing drastic renovation for existing building as well, with development for changes by lifestyle and needs of (Core tenants) expanded building by AEON Mall Co., Ltd. customers and secure position as top-class Community Entertainment ◼ AEON Mall Co., Ltd. can also enhance expansion strategy for excellent stores without regional retail related properties with facilities facilities competitive advantage. considering land acquisition cost. Acquisition of completed building Expanding the portfolio to include logistics facilities Development + Internal growth supporting AEON Group

◼ Establishing an efficient group supply chain intensification by strategically locating and operating group logistics facilities.

AEON MALL Kofu Showa Implementation of Growth Strategies Through Collaboration with AEON Group AEON Daiei-Kawasaki Daiei-Ibaraki Store renovation by investment revitalization and MINAMI-OSAKA RDC Process Center Process Center Enhancement of internal growth

Enhancing relations with Sponsor Group ◼ Enhancing internal growth by rent increase, continuing Capitalizing on AEON Group’s overseas strategy investment in revitalization contributing to improve values ◼ Acquisition of full-scale overseas properties as J-REIT’s first of retail properties and making efforts to maintain and practice Diversification of property improve competitiveness. ◼ In Malaysia where AEON Group has more than thirty-year track acquisition methods

records, planning to acquire AEON MALL Seremban2, full-scale- ◼ Realizing mobile property acquisition by Approach to disaster mall-type RSC (approx. ¥5.2 billion). obtainment of preferential negotiation rights. ◼ Following the Kumamoto Earthquake, AEON REIT obtained Major stores of ◼ Able to acquire property utilizing mobility earthquake insurance for its portfolio to ensure stable management AEON Group in Malaysia and available capacity by utilizing various and distribution in the future. The insurance covers the 38 acquisition methods. properties in Japan (it does not cover the 2 properties overseas). ◼ Insurance amount:¥3.0 billion(exemption from responsibility: ¥100 million) Acquisition of full-scale ◼ Removed impact on distribution through coverage by earthquake overseas properties as J- AEON MALL REIT’s first practice insurance and the reversal of distribution reserves to deal with Seremban2 unexpected disasters, such as typhoon and earthquake, that AEON MALL Kumamoto AEON MALL Kyoto Gojo occurred during the respective fiscal periods. Increase in “Portfolio Quality” 48 Appendix２Supplement Balance Sheet for the 12th Fiscal Period (as of January 31, 2019)

11th Period 12th Period 11th Period 12th Period As of July 31, 2018 As of January 31, 2019 As of July 31, 2018 As of January 31, 2019 Amount Amount Amount Amount Percentage Percentage Percentage Percentage (thousands of (thousands of (thousands of (thousands of (%) (%) (%) (%) yen) yen) yen) yen) Assets Liabilities

Current assets 22,947,646 6.3% 18,386,990 5.1% Current liabilities 29,474,267 8.1% 17,294,840 4.8%

Cash and deposits 15,392,040 4.2% 9,504,798 2.6% Operating accounts payable 665,785 0.2% 950,743 0.3%

Cash and deposits in trust 7,093,497 2.0% 7,821,463 2.2% Current portion of long-term loans payable 27,000,000 7.4% 15,600,000 4.3%

Prepaid expenses 444,990 0.1% 592,920 0.2% Accounts payable - other 348,633 0.1% 365,061 0.1%

Income taxes receivable 12 0.0% 15 0.0% Accrued expenses 52,192 0.0% 63,109 0.0%

Consumption taxes receivable - 0.0% 459,376 0.1% Income taxes payable 605 0.0% 605 0.0%

Other 17,105 0.0% 8,417 0.0% Accrued consumption taxes 1,184,456 0.3% 0.0% - Non-current assets 339,583,837 93.6% 343,656,762 94.9% Provision for loss on disaster 32,558 0.0% 126,859 0.0%

Property and equipment 283,281,269 78.1% 287,395,064 79.3% Other 190,036 0.1% 188,462 0.1%

Land 108,463 0.0% 108,463 0.0% Non-current liabilities 135,330,949 37.3% 146,981,777 40.6%

Buildings in trust, net 161,832,860 44.6% 165,989,732 45.8% Investment corporation bond 6,000,000 1.7% 21,000,000 5.8%

Structures in trust, net 446,948 0.1% 403,486 0.1% Long-term loans payable 117,000,000 32.3% 113,400,000 31.3% Tools, furniture and fixtures in trust, 7,571 0.0% 6,766 0.0% Tenant leasehold and security deposits 2,628 0.0% 2,628 0.0% net Tenant leasehold and security deposits in Land in trust 120,885,426 33.3% 120,885,426 33.4% 12,328,321 3.4% 12,579,149 3.5% trust Construction in progress in trust - - 0.0% Total liabilities 164,805,216 45.4% 164,276,617 45.3% 1,188 Intangible assets 49,235,482 13.6% 49,235,482 13.6% Net assets

Leasehold rights in trust 49,235,482 13.6% 49,235,482 13.6% Unitholders’ equity 197,947,907 54.6% 198,019,906 54.7%

Investments and other assets 7,067,085 1.9% 7,026,215 1.9% Unitholders’ capital, net 192,172,327 53.0% 192,172,327 53.0%

Shares of subsidiaries and associates 6,078,453 1.7% 6,078,453 1.7% Unitholders’ capital 195,698,024 53.9% 195,698,024 54.0% Other deduction from unitholders’ Long-term prepaid expenses 978,170 0.3% 937,301 0.3% △ 3,525,697 △1.0% △ 3,525,697 △1.0% capital Lease and guarantee deposits 10,460 0.0% 10,460 0.0% Surplus 5,775,580 1.6% 5,847,579 1.6%

Deferred assets 221,639 0.1% 252,771 0.1% Distribution reserve 520,000 0.1% 520,000 0.1% Unappropriated retained earnings Investment unit issuance expenses 152,102 0.0% 83,417 0.0% 5,255,580 1.4% 5,327,579 1.5% (undisposed loss) Investment corporation bond issuance 69,537 0.0% 169,353 0.0% Total net assets 197,947,907 54.6% 198,019,906 54.7% costs Total assets 362,753,124 100.0% 362,296,524 100.0% Total liabilities and net assets 362,753,124 100.0% 362,296,524 100.0%

50 Statement of Income for the 12th Fiscal Period (as of January 31, 2019) （Breakdown of revenues and expenses related to real （Statements of Income） estate leasing business） 11th Period 12th Period As of July 31, 2018 As of January 31, 2019 11th Period 12th Period As of July 31, 2018 As of January 31, 2019 Amount Percentage Amount Percentage (thousands of yen) (%) (thousands of yen) (%) Amount Amount Percentag Operating revenue 16,201,842 100.0% 16,329,586 100.0% Percentage (thousands of (thousands of e (%) Rent revenue - real estate 16,025,515 98.9% 16,197,957 99.2% yen) yen) (%) Gain on sale of real estate 35,691 0.2% - - Rent revenue–real estate 100.0% 100.0% Dividends received 140,636 0.9% 131,628 0.8% 16,025,515 16,197,957 Operating expenses 10,019,439 61.8% 9,993,899 61.2% Expenses related to rent business 9,081,776 56.1% 9,068,931 55.5% Rent 99.5% 99.5% 15,951,087 16,117,260 （Depreciation） (4,355,394) (26.9%) (4,424,597) (27.1%) Asset management fee 734,982 4.5% 752,486 4.6% Other rent revenue–real estate 0.5% 0.5% Asset custody fee 18,728 0.1% 18,915 0.1% 74,427 80,697 Administrative service fees 56,438 0.3% 56,176 0.3% Directors’ compensation 3,600 0.0% 3,600 0.0% Expenses related to real estate leasing business 56.7% 56.0% Taxes and dues 19,003 0.1% 6,617 0.0% 9,081,776 9,068,931 Other operating expenses 104,909 0.6% 87,172 0.5% Property and facility management Operating income 6,182,403 38.2% 6,335,687 38.8% 0.3% 0.3% fees 43,192 42,846

Non-operating income 1,315 0.0% 1,478 0.0% Repairs and maintenance expenses 3.4% 3.3% 550,088 532,102 Interest income 84 0.0% 100 0.0% Refund of unpaid distributions 1,134 0.0% 1,377 0.0% Insurance expenses 0.9% 1.0% Other 96 0.0% - - 149,235 155,278 Non-operating expenses 886,561 5.5% 888,637 5.4% Trust fees 0.1% 0.1% Interest expenses 570,881 3.5% 549,357 3.4% 20,702 20,708 Interest expenses on investment corporation bonds 24,619 0.2% 42,915 0.3% Land rent paid 12.8% 12.5% Amortization of investment unit issuance expenses 68,684 0.4% 68,684 0.4% 2,048,376 2,020,929 Amortization of investment corporation bond issuance 3,621 0.0% 5,375 0.0% Taxes and dues 11.6% 11.2% costs 1,862,128 1,818,691 Investment corporation bond issuance costs - - 19,714 0.1% Borrowing related expenses 218,626 1.3% 202,275 1.2% Depreciation 27.2% 27.3% 4,355,394 4,424,597 Other 127 0.0% 315 0.0% Ordinary income 5,297,156 32.7% 5,448,528 33.4% Water charges 0.3% 0.3% 49,238 51,835 Extraordinary income - - 152,758 0.9% Other expenses related to rent 0.0% 0.0% Insurance income - - 152,758 0.0% business 3,419 1,941

Extraordinary losses 37,459 0.2% 274,845 1.7% Loss on disaster 4,900 0.0% 147,986 0.9% Provision for loss on disaster 32,558 0.2% 126,859 0.8% ＮＯＩ - - 11,299,133 11,553,623 Income (loss) before income taxes 5,259,697 32.5% 5,326,441 32.6% Rent revenue–real estate（＋） - - Income taxes - current 5,349 0.0% 605 0.0% 16,025,515 16,197,957 Total income taxes 5,349 0.0% 605 0.0% Expenses related to real estate ▲ 9,081,776 - ▲ 9,068,931 - Net income (loss) 5,254,348 32.4% 5,325,836 32.6% leasing business（▲） Retained earnings brought forward 1,231 0.0% 1,742 0.0% Depreciation （＋） - - Unappropriated retained earnings (undisposed loss) 5,255,580 32.4% 5,327,579 32.6% 4,355,394 4,424,597

51 Portfolio①

Total Leasable Book Value Appraisal Unrealized Acquisition Price PML value(Note3) No. Region Property Name Location Acquisition Date Area at the end of period value(Note1) Profit&Loss(Note2) （millions of yen）（％）（㎡）（millions of yen）（millions of yen）（millions of yen） Hokkaido/ 1 AEON MALL Sapporo-Hiraoka Sapporo City, Hokkaido February, 2015 78,360.81 5,900 5,397 6,340 942 3.5% Tohoku Hokkaido/ 2 AEON MALL Kushiro-Showa Kushiro City, Hokkaido February, 2015 51,763.05 1,780 1,751 1,930 178 7.0% Tohoku Hokkaido/ 3 AEON MALL Tomakomai Tomakomai City, Hokkaido September, 2016 71,308.33 7,840 7,598 8,220 621 2.9% Tohoku Hokkaido/ 4 AEON MALL Morioka Morioka City, Iwate Pref. November, 2013 98,968.59 5,340 5,456 6,720 1,263 11.1% Tohoku Hokkaido/ 5 AEON MALL Ishinomaki Ishinomaki City,Miyagi Pref. November, 2013 60,682.20 6,680 6,085 7,080 994 3.9% Tohoku Hokkaido/ 6 AEON MALL Rifu Miyagi County, Miyagi Pref. February, 2015 66,478.91 2,560 2,326 2,770 443 6.9% Tohoku Hokkaido/ 7 AEON MALL Yamagata-Minami Yamagata City, Yamagata Pref. February, 2015 53,502.94 1,350 1,324 1,470 145 6.2% Tohoku 8 Kanto AEON MALL Mitouchihara(Note 4) Mito City, Ibaraki Pref. November, 2013 159,997.49 16,565 14,527 17,413 2,885 0.7%

9 Kanto AEON MALL Tsuchiura Tsuchiura City, Ibaraki Pref. February, 2016 86,848.51 12,030 11,541 12,400 858 1.0%

10 Kanto AEON MALL Shimotsuma Shimotsuma City, Ibaraki Pref. September, 2017 58,402.66 9,552 9,300 9,820 519 2.7%

11 Kanto AEON MALL Oyama Oyama City, Tochigi Pref. August, 2016 47,872.33 6,280 5,936 6,450 513 4.5%

12 Kanto AEON MALL Ota Ota City, Gunma Pref. November, 2013 93,165.27 6,860 5,991 8,060 2,068 4.8%

13 Kanto AEON LakeTown mori(Note 5) Koshigaya City, Saitama Pref. November, 2013 205,711.70 21,190 19,185 23,800 4,614 2.0%

14 Kanto AEON LakeTown kaze(Note 5) Koshigaya City, Saitama Pref. November, 2013 127,183.81 6,730 6,055 7,880 1,824 1.7%

15 Kanto AEON MALL Chiba-Newtown Inzai City, Chiba Pref. March, 2016 107,425.97 12,190 11,794 12,400 605 2.7%

16 Kanto AEON STYLE Kemigawahama Chiba City, Chiba Pref November, 2017 29,947.62 3,748 3,636 3,860 223 2.6%

17 Kanto AEON Sagamihara Shopping Center Sagamihara City, Kanagawa Pref. November, 2013 75,056.62 10,220 9,804 11,000 1,195 13.4%

18 Kanto AEON Chigasaki-Chuo Shopping CenterChigasaki City, Kanagawa Pref. May, 2016 63,158.24 6,410 6,381 6,590 208 14.8%

19 Kanto Daiei-Kawasaki Process Center Kawasaki City, Kanagawa Pref. February, 2016 59,265.77 14,280 13,932 15,100 1,167 3.7% Tokai/Hokuri 20 ku/ AEON MALL Kahoku Kahoku City, Ishikawa Pref. February, 2016 70,948.14 9,940 9,314 10,600 1,285 11.4% Chubu Tokai/Hokuri 21 ku/ AEON MALL Kofu Showa(Note 6) Nakakoma County, Yamanashi Pref. February, 2016 99,772.38 15,489 15,743 17,300 1,556 2.5%、3.1% Chubu Tokai/Hokuri 22 ku/ AEON MALL Ogaki Ogaki City, Gifu Pref. November, 2013 64,246.26 4,950 3,845 4,960 1,114 9.2% Chubu Tokai/Hokuri 23 ku/ AEON MALL Suzuka Suzuka City, Mie Pref. November, 2013 125,253.74 9,660 9,321 10,100 778 7.5% Chubu Tokai/Hokuri 24 ku/ AEON MALL Meiwa Taki County, Mie Pref. November, 2013 44,193.80 3,290 3,181 3,650 468 4.6% Chubu Tokai/Hokuri 25 ku/ AEON MALL Yokkaichi-Kita Yokkaichi City, Mie Pref. February, 2015 41,447.33 2,210 2,209 2,630 420 6.0% Chubu Tokai/Hokuri 26 ku/ AEON MALL KYOTO Kyoto City, Kyoto Pref. February, 2015 136,468.45 21,470 20,276 22,500 2,223 13.5% Chubu Tokai/Hokuri 27 ku/ AEON Mall Kyoto Gojo Kyoto City, Kyoto Pref. July, 2018 86,984.79 13,333 13,369 13,600 230 11.6% Chubu

52 Portfolio②

Total Leasable Book Value Appraisal Unrealized Acquisition Price PML value(Note3) No. Region Property Name Location Acquisition Date Area at the end of period value(Note1) Profit&Loss(Note2) （millions of yen）（％）（㎡）（millions of yen）（millions of yen）（millions of yen） Tokai/Hokuriku/ 28 AEON Minami-Osaka RDC Sakai City, Osaka Pref. February, 2017 50,197.06 9,870 9,716 10,600 883 12.5% Chubu Tokai/Hokuriku/ AEON Kireuriwari Shopping 29 Osaka City, Osaka Pref. September, 2017 27,603.46 4,394 4,434 4,640 205 9.3% Chubu Center Tokai/Hokuriku/ 30 Daiei-Ibaraki Process Center Ibaraki City, Osaka Pref. October, 2017 50,783.58 6,810 6,854 7,290 435 12.6% Chubu Tokai/Hokuriku/ 31 AEON MALL Kasai-Hojo Kasai City, Hyogo Pref. November, 2013 48,229.25 7,230 6,235 7,610 1,374 10.7% Chubu Tokai/Hokuriku/ 32 AEON MALL Itamikoya Itami City, Hyogo Pref. February, 2016 122,944.71 16,860 16,364 17,600 1,235 1.8% Chubu Tokai/Hokuriku/ 33 AEON MALL Yamatokoriyama Yamatokoriyama City, Nara Pref. February, 2016 105,230.88 14,500 13,631 14,800 1,168 12.0% Chubu Tokai/Hokuriku/ 34 AEON MALL Hiezu Saihaku County, Tottori Pref. November, 2013 102,045.24 7,780 7,024 8,310 1,285 8.0% Chubu Tokai/Hokuriku/ 35 AEON MALL Kurashiki Kurashiki City, Okayama Pref. November, 2013 157,274.78 17,890 16,553 19,700 3,146 0.5% Chubu Tokai/Hokuriku/ 36 AEON MALL Ayagawa Ayauta County, Kagawa Pref. November, 2013 113,149.07 8,740 7,016 8,710 1,693 0.6% Chubu 37 Kyushu/Okinawa AEON MALL Nogata(Note7) Nogata City, Fukuoka Pref. November, 2013 151,969.51 11,246 9,888 13,300 3,411 0.1%

38 Kyushu/Okinawa AEON MALL Kagoshima Kagoshima City, Kagoshima Pref. February, 2016 132,341.35 13,400 12,975 13,900 924 6.1%

658 645 567 △77 39 Overseas AEON Taman Universiti(Note8) Johor, Malaysia June, 2014 22,870.00 0.8% (20millions of RM) (19millions of RM) （21mililions of RM） (1miliions of RM）

5,252 6,211 40 Overseas AEON MALL SEREMBAN 2 Negeri Sembilan, Malaysia September, 2016 81,135.00 - - 4.0% （215millions of RM）（233millions of RM）

Grand total (as of January 31, 2019 with 40 3,430,189.60 362,478 - 387,882 45,039 1.5% properties)

(Note 1) The valuation date of the Appraisal value is January 31, 2019. (Note 2) Unrealized profit (loss) = Appraisal value − Book value at end of period (Note 3) Each property undergoes a seismic risk analysis to forecast the loss rate related to damage from the recurrence of an earthquake during a 475 year period. The number for Domestic Subtotal is not an average, but rather the PML value for the whole domestic portfolio. (Note 4) Acquisition price, Book value at end of period, Appraisal value and Unrealized profit (loss) include a real estate portion (adjacent land portion that was additionally acquired on April 28, 2015). (Note 5) Acquisition price, Book value at end of period, Appraisal value and Unrealized profit (loss) describe AEON REIT’s pro-rata portion of the quasi-co-ownership interest (jun kyōyū-mochibun) in the trust beneficiary rights (40% for each property). (Note 6) Acquisition price, Book value at end of period, Appraisal value and Unrealized profit (loss) include a real estate portion (The Extended Building that was additionally acquired on September 3, 2018). PML of the existing building and the extended building of AEON MALL Kofu Showa is 2.5%, 3.1%, respectively. (Note 7) Acquisition price of AEON MALL Nogata has decreased because of transfer of land. (Note 8) Acquisition price, Book value at end of period, Appraisal value and Unrealized profit (loss) describe AEON REIT’s portion of the amount equivalent to the rights (18.18%) similar to the co-ownership interest (kyōyū-mochibun) of the trust property for which the rights were transferred from AEON CO. (M) BHD., which holds the whole property.

53 Appraisal Value for the 40 Properties held in 12th fiscal period

Capitalization Rate based on direct capitalization Appraisal value (Millions of yen) Property Acquisition price method (%) Property name Appraisal agency number (Millions of yen) 11th Period 12th Period 11th Period 12th Period Difference Difference (July 31, 2018) (Jun 31, 2019) (July 31, 2018) (Jun 31, 2019) SRSC-1 AEON LakeTown mori (Note1) The Tanizawa Sōgō Appraisal Co., Ltd. 21,190 23,800 23,800 0 4.8 4.8 0.0 SRSC-2 AEON LakeTown kaze (Note1) The Tanizawa Sōgō Appraisal Co., Ltd. 6,730 7,880 7,880 0 5.2 5.2 0.0 RSC-1 AEON MALL Morioka Japan Real Estate Institute 5,340 6,720 6,720 0 6.6 6.6 0.0 RSC-2 AEON MALL Ishinomaki Japan Real Estate Institute 6,680 7,080 7,080 0 6.2 6.2 0.0 AEON MALL Mitouchihara Japan Real Estate Institute 16,460 17,300 17,300 0 6.0 6.0 0.0 RSC-3 AEON MALL Mitouchihara (Land) Japan Real Estate Institute 105 113 113 0 - - - RSC-4 AEON MALL Ota Japan Real Estate Institute 6,860 8,060 8,060 0 6.4 6.4 0.0 RSC-5 AEON Sagamihara Shopping Center Japan Real Estate Institute 10,220 11,000 11,000 0 5.2 5.2 0.0 RSC-6 AEON MALL Ogaki Japan Real Estate Institute 4,950 4,960 4,960 0 7.0 7.0 0.0 RSC-7 AEON MALL Suzuka Japan Real Estate Institute 9,660 10,600 10,100 ▲ 500 6.2 6.2 0.0 RSC-8 AEON MALL Meiwa The Tanizawa Sōgō Appraisal Co., Ltd. 3,290 3,660 3,650 ▲ 10 6.5 6.5 0.0 RSC-9 AEON MALL Kasai-Hojo Japan Real Estate Institute 7,230 7,690 7,610 ▲ 80 6.8 6.8 0.0 RSC-10 AEON MALL Hiezu Japan Real Estate Institute 7,780 8,500 8,310 ▲ 190 6.8 6.8 0.0 RSC-11 AEON MALL Kurashiki Japan Real Estate Institute 17,890 19,700 19,700 0 6.0 6.0 0.0 RSC-12 AEON MALL Ayagawa Japan Real Estate Institute 8,740 8,720 8,710 ▲ 10 6.5 6.5 0.0 RSC-13 AEON MALL Nogata Japan Real Estate Institute 11,246 13,200 13,300 100 6.4 6.4 0.0 RSC-15 AEON MALL KYOTO Japan Real Estate Institute 21,470 22,500 22,500 0 4.8 4.8 0.0 RSC-16 AEON MALL Sapporo-Hiraoka The Tanizawa Sōgō Appraisal Co., Ltd. 5,900 6,340 6,340 0 6.2 6.2 0.0 RSC-17 AEON MALL Kushiro-Showa The Tanizawa Sōgō Appraisal Co., Ltd. 1,780 1,930 1,930 0 6.8 6.8 0.0 RSC-18 AEON MALL Rifu The Tanizawa Sōgō Appraisal Co., Ltd. 2,560 2,770 2,770 0 6.4 6.4 0.0 RSC-19 AEON MALL Yamagata-Minami The Tanizawa Sōgō Appraisal Co., Ltd. 1,350 1,470 1,470 0 6.6 6.6 0.0 RSC-20 AEON MALL Yokkaichi-Kita The Tanizawa Sōgō Appraisal Co., Ltd. 2,210 2,630 2,630 0 6.2 6.2 0.0 RSC-21 AEON MALL Yamatokoriyama Japan Real Estate Institute 14,500 14,800 14,800 0 5.6 5.6 0.0 RSC-22 AEON MALL Chiba-Newtown Japan Real Estate Institute 12,190 12,400 12,400 0 4.9 4.9 0.0 RSC-23 AEON MALL Kofu Showa(note2) Japan Real Estate Institute 15,489 17,300 17,300 0 5.7 5.7 0.0 RSC-24 AEON MALL Tomakomai The Tanizawa Sōgō Appraisal Co., Ltd. 7,840 8,220 8,220 0 5.9 5.9 0.0 RSC-25 AEON MALL Oyama Japan Real Estate Institute 6,280 6,430 6,450 20 6.7 6.7 0.0 RSC-26 AEON MALL Itamikoya Japan Real Estate Institute 16,860 17,600 17,600 0 5.6 5.6 0.0 RSC-27 AEON MALL Kagoshima The Tanizawa Sōgō Appraisal Co., Ltd. 13,400 13,900 13,900 0 6.0 6.0 0.0 RSC-28 AEON MALL Tsuchiura Japan Real Estate Institute 12,030 12,400 12,400 0 6.3 6.3 0.0 RSC-29 AEON MALL Kahoku Japan Real Estate Institute 9,940 10,600 10,600 0 6.9 6.9 0.0 RSC-30 AEON MALL Shimotsuma Japan Real Estate Institute 9,552 9,820 9,820 0 6.4 6.4 0.0 RSC-31 AEON MALL Kyoto Gojo The Tanizawa Sōgō Appraisal Co., Ltd. 13,333 13,600 13,600 0 4.9 4.9 - CSC-1 AEON Chigasaki-Chuo Shopping Center Japan Real Estate Institute 6,410 6,570 6,590 20 5.0 5.0 0.0 CSC-2 AEON STYLE Kemigawahama Japan Real Estate Institute 3,748 3,860 3,860 0 6.2 6.2 0.0 CSC-3 AEON KireuriwariShopping Center The Tanizawa Sōgō Appraisal Co., Ltd. 4,394 4,640 4,640 0 5.2 5.2 0.0 L-1 Daiei-Kawasaki Process Center Japan Real Estate Institute 14,280 15,000 15,100 100 4.9 4.9 0.0 L-2 AEON Minami-Osaka RDC Japan Real Estate Institute 9,870 10,300 10,600 300 4.9 4.8 ▲ 0.1 L-3 Daiei-Ibaraki Process Center Japan Real Estate Institute 6,810 7,140 7,290 150 5.1 5.0 ▲ 0.1 658 588 567 M-1 - - - - AEON Taman Universiti Shopping Centre (Note2) Japan Real Estate Institute (20百万RM) (21.5百万RM) (21.3百万RM) 5,252 6,374 6,211 M-2 - - - - AEON MALL Seremban2 (Note3) Japan Real Estate Institute (215百万RM) (233百万RM) (233百万RM) TOTAL 362,478 388,166 387,882 - - - - (Note 1) For AEON LakeTown mori and AEON LakeTown kaze, their appraisal values, price based on direct capitalization method, price based on DCF method, and NOI describe the Investment Corporation’s pro-rata portion of the quasi-co-ownership interest (jun kyōyū-mochibun) in the beneficiary rights of real estate in trust (40% for each property). (Note 2) The appraisal value of AEON MALL Kofu Showa at the end of 11th period is based on the total appraisal value of the existing building and the extended building of AEON MALL Kofu as of August 1, 2018. (Note 3) Pursuant to the local appraisal methodology, we entrusted the evaluation of the appraisal value of the property to Japan Real Estate Institute. Appraisal value represents the amount equivalent to the Investment Corporation’s pro-rata portion of the rights (18.18%) similar to the co-ownership right (kyōyū-mochibun) of the trust property pertaining to the trust of the beneficiary rights of real estate in trust. In addition, the amount in Malaysian Ringgit was converted to Japanese yen based on the exchange rate as of the end of the fiscal period (July 31, 2018; 1 RM = ¥27.36, January 31, 2019; 1RM = ¥26.66; rounded down to the nearest 100th). (Note 4) The amount in Malaysian Ringgit was converted to Japanese yen based on the exchange rate as of the end of the fiscal period (July 31, 2018; 1 RM = ¥27.36,January 31, 2019; 1RM = ¥26.66 ; rounded down to the nearest 100th). 54 Average cap rate of Portfolio

Average cap rate of portfolio(Note) （%） 6.3 6.2 6.1 6.0 5.9 5.8 5.7 5.6 5.5 3rd Fiscal Period 4th Fiscal Period 5th Fiscal Period 6th Fiscal Period 7th Fiscal Period 8th Fiscal Period 9th Fiscal Period 10th Fiscal Period 11th Fiscal Period 12th Fiscal Period （July 2014）（January 2015）（July 2015）（January 2016）（July 2016）（January 2017）（July 2017）（January 2018）（July 2018）（January 2019）

Average cap rate of portfolio of in area-wise(Note) Average cap rate of portfolio for Trade-Area Population within 10km(Note)

（%）（%） 7.00 7.00

6.50 6.50

6.00 6.00

5.50 5.50

5.00 5.00

4.50 4.50

4.00 4.00 3rd Fiscal 4th Fiscal 5th Fiscal 6th Fiscal 7th Fiscal 8th Fiscal 9th Fiscal 10th Fiscal 11th Fiscal 12th Fiscal 3rd Fiscal Period 4th Fiscal Period 5th Fiscal Period 6th Fiscal Period 7th Fiscal Period 8th Fiscal Period 9th Fiscal Period 10th Fiscal Period11th Fiscal Period12th Fiscal Period Period Period（January Period Period（January Period Period Period Period Period Period （July 2014）（January 2015）（July 2015）（January 2016）（July 2016）（January 2017）（July 2017）（January 2018）（July 2018）（Junuary 2019）（July 2014） 2015）（July 2015） 2016）（July 2016）（January 2017）（July 2017）（January 2018）（July 2018）（January 2019）

three largest cities others 500 thousand or more less than 500 thousand

(Note) ・Average cap rate is calculated excluding Malaysian properties whose return yield by direct capitalization method is not calculated. ・“The three largest cities” indicates the Metropolitan, Chubu and Kinki areas, i.e. Metropolitan area covers Tokyo, Kanagawa, Saitama and Chiba pref., Chubu area covers Aichi, Gifu and Mie pref. and Kinki covers Osaka, Kyoto, Hyogo, Nara and Shiga pref. in each. ・“Trade-Area Population within 10km” is calculated excluding Daiei-Kawasaki PC , AEON Minami-Osaka RDC and Daiei-Ibaraki PC. 55 Portfolio PML and Earthquake Insurance

Conventional policy against earthquake risk

⚫ Promote portfolio diversification (size per property and property locations) ⚫ Consider purchasing earthquake insurance for individual properties whose PML(Note) exceeds 15%. Manage the portfolio to prevent its PML from exceeding 10%. ⚫ Ensure available financing capacity and funds in hand for contingencies through conservative LTV management and cash flow generated by depreciation expenses.

（Note）The probable maximum loss (PML) indicates a loss from a very rare, massive earthquake that strikes once in 475 years as a percentage of a building’s price.

Investment ratio Status of earthquake risk in the current portfolio (top 10 properties) KYOTOKYOTO 5.9% レイクタウンLake Townmori mori 5.8% Probable Maximum 倉敷Kurashiki 4.9% PML（％） Loss 伊丹昆陽Itamikoya 4.7% 水戸内原Mitouchihara 4.6% Domestic portfolio PML 38 properties 1.5 ％ Approx. ¥5.0 billion 甲府昭和Kofu Showa 4.3% 大和郡山Yamatokoriyama 4.0% Kawasaki PC *1. Earthquake risk assessment report (Tokio Marine & Nichido Risk Consulting Co., Ltd.) 川崎PC 3.9% *2. The expected maximum amount of loss calculated by multiplying the sum total of 鹿児島Kagoshima 3.7% replacement costs of the properties (the amount required for constructing new equivalent buildings) by the portfolio PML 京都五条Kyoto Gojo 3.7% その他Other 54.5% Diversification of property locations (23 prefectures in Japan) 茨城県Ibaraki 10.5% Use of earthquake insurance 京都府Kyoto 9.6%

⚫ AEON examines the effect on distributions and cost effectiveness of the insurance premiums based on the 神奈川県Kanagawa 8.5% maximum loss estimated from the domestic portfolio PML and acquires earthquake insurance coverage. 埼玉県Saitama 7.7% 兵庫県Hyogo 6.6% Properties insured 38 properties 大阪府Osaka 5.8% Properties held in Japan Maximum payment 岡山県Okayama 4.9% ¥3.0 billion (deductible: ¥100 million) 千葉県Chiba 4.4% 北海道Hokkaido 4.3% Premiums (annual) ¥150 million 山梨県Yamanashi 4.2% その他Other 33.3%

56 Result of Internal Growth

Achieved increases in medium- and long-term rents by making investments for revitalization. Major cases of Investments in Revitalization with increase in rent after Feb. 2018

Effect of revitalization（per annum） Rent increase Project cost Property (scheduled) Revitalization project (millions of yen) Rent increase Rent increase month (Note 1) as a percentage of (millions of yen) project cost (%)

AEON MALL Nogata(Note2) February 2018 Conversion of lighting to LEDs 69 6.9 10.0 AEON MALL Hiezu July 2018 Large scale renewal 73 6.1 8.4 AEON MALL Nogata(Note2) August 2018 Conversion of lighting to LEDs 71 7.1 10.0 AEON MALL Kurashiki August 2018 Renewal of food sales area 82 6.1 7.5

AEON MALL Kofu showa September 2018 the revitalization of the existing building 781 50.7 6.5

Installation of a new exit and entrance AEON MALL Kurashiki December 2018 44 3.1 7.0 on the north side of the mall

AEON MALL Suzuka March 2019 Connection to public sewerage 88 6.4 7.3

（Note1） “Projected cost of investments in revitalization” indicates construction cost in order to improve the value of the properties operated.

（Note2） Rent has been increased for 10 years.

Cumulative amount of annualized rent increase as a result of investments in revitalization projects (note3)

（Millions of yen） 291 298

217 196 149 110 113 47 50 13 15

3rd Period 4th Period 5th Period 6th Period 7th Period 8th Period 9th Period 10th Period 11th Period 12th Period 13th Period (Forecast) （Note 3）The scope is limited to the properties which Aeon Reit owned at the end of July 2018. 57 Performance of Properties in Portfolio

Rent Revenues at Master Lease Companies of 34 Retail Domestic Properties in Portfolio

(Billions of yen) 25.0

20.0 21.0 21.3 20.1 19.6 19.6 20.1 19.8 19.5 20.3 20.1 19.7 15.0

10.0 Mar. 2016–Feb. 2017 Mar. 2017–Feb. 2018 (12-month period) ¥80.4billion (12-month period) ¥80.7billion 5.0

0.0 Mar–May Jun–Aug Sep–Nov Dec 2016– Mar–May Jun–Aug Sep–Nov Dec 2017– Mar–May Jun–Aug Sep–Nov 2016 2016 2016 Feb 2017 2017 2017 2017 Feb 2018 2018 2018 2018 (Note 1)Revenue such as rent income and income incidental thereto received by the master lease company from end tenant. And, AEON STYLE Kemigawahama ,AEON REIT acquired on November 30, 2017 , does not include. (Note 2)The rent revenue figures above are data based on interviews of master lease companies.

Sales Trends of individual Properties for June 2018 - November 2018 22

9 2 0 0 1 90% 95% 100% 105% YoY sales index Less than 90% More than 110% ～95% ～100% ～105% ～110%

% of total 0% 0% 64.7% 26.5% 5.9% 2.9%

Notes) 1. Sales of each property for June 2018 – November 2018 are expressed as a percentage of sales for the same period a year earlier (June 2017 – November 2017 ). 2. The year-on-year sales index above presents data based on interviews of master lease companies. AEON STYLE Kemigawahama ,AEON REIT acquired on November 30, 2017 , does not include. 3. The figures in the year-on-year sales index above have been rounded to the nearest hundredh of a percent. As a result, the total amount may not always total 100.0%. 58 Financial Management

7th period 8th period 9th period 10th period 11th period 12th period

（July 31, 2017）（January 31, 2017）（July 31, 2017）（January 31, 2018）（July 31, 2018）（January 31, 2019）

Short-term loans payable ¥0million ¥1,500million ¥1,500million ¥0million ¥0million ¥0million

Long-term loans payable ¥98,900million ¥113,300million ¥143,000million ¥144,000million ¥144,000million ¥129,000million

Investment Corporation bonds ¥2,000million ¥4,000million ¥4,000million ¥6,000million ¥6,000million ¥21,000million

Tenant leasehold and security ¥10,169million ¥10,449million ¥12,474million ¥12,916million ¥12,330million ¥12,581million deposits

Total debt ¥111,069million ¥134,904million ¥162,683million ¥164,621million ¥164,805million ¥164,276million

LTV (including leasehold 42.8% 46.4% 46.7% 44.9% 44.7% 44.9% deposits)

LTV (excluding leasehold 38.9% 42.7% 43.0% 41.4% 41.4% 41.4% deposits)

Long-term debt ratio 100.0% 98.7% 99.0% 100.0% 100.0% 100.0%

Fixed interest rate ratio 88.4% 96.5% 92.9% 95.7% 95.7% 95.7%

Average remaining borrowed 4.1 year 4.7 year 4.4 year 4.2 year 3.7 year 4.6 year period

Average interest rate on 0.85% 0.84% 0.79% 0.80% 0.80% 0.78% borrowings

59 Debt Snapshot

１. Borrowings Borrowing Amount Floating rate/ Borrowing Date Term Maturity Interest rate Breakup Fixed rate ¥22.0bn October 20, 2020 Effective fixed rate (Note 2) 1.17250% November 25, 2013 Long-term ¥27.0bn ¥5.0bn October 20, 2023 Effective fixed rate (Note 2) 1.76375% ¥1.2bn October 21, 2019 Effective fixed rate (Note 2) 0.61910% February 27, 2015 Long-term ¥9.7bn ¥4.0bn October 20, 2021 Effective fixed rate (Note 2) 0.88915% ¥4.5bn October 21, 2024 Effective fixed rate (Note 2) 1.40390% February 29, 2016 ¥4.1bn October 21, 2019 Effective fixed rate (Note 2) 0.14750% ¥6.0bn October 20, 2021 Effective fixed rate (Note 2) 0.35125% March 29, 2016 Long-term ¥23.5bn ¥5.8bn October 20, 2022 Effective fixed rate (Note 2) 0.54100% May 31, 2016 ¥6.6bn October 20, 2025 Effective fixed rate (Note 2) 0.99100% February 29, 2016 ¥1.0bn October 20, 2027 Effective fixed rate (Note 2) 1.40730% ¥3.9bn October 21, 2019 Effective fixed rate (Note 2) 0.23700% ¥4.8bn October 20, 2022 Effective fixed rate (Note 2) 0.48750% Existing Borrowings ¥1.2bn October 20, 2022 Fixed rate 0.55000% October 20, 2016 Long-term ¥23.4bn ¥6.7bn October 20, 2023 Effective fixed rate (Note 2) 0.61375% ¥2.7bn October 20, 2025 Effective fixed rate (Note 2) 0.87250% ¥4.1bn October 20, 2026 Effective fixed rate (Note 2) 1.00300% ¥6.4bn October 21, 2019 Floating base rate(Note 1) +0.22% ¥6.1bn October 20, 2021 Effective fixed rate (Note 2) 0.43200% ¥5.2bn October 20, 2022 Effective fixed rate (Note 2) 0.52800% March 28, 2017 Long-term ¥29.7bn ¥0.2bn October 20, 2022 Fixed rate 0.63000% ¥6.8bn October 21, 2024 Effective fixed rate (Note 2) 0.83800% ¥5.0bn October 20, 2026 Effective fixed rate (Note 2) 1.09710% ¥3.4bn October 20, 2023 Effective fixed rate (Note 2) 0.52270% December 27, 2017 Long-term ¥3.7bn ¥0.3bn October 20, 2023 Fixed rate 0.60000% ¥3.0bn October 20, 2021 Effective fixed rate (Note 2) 0.37850% New ¥4.6bn October 20, 2023 Effective fixed rate (Note 2) 0.59700% November 22, 2018 Long-term ¥12.0bn Borrowings ¥0.4bn October 20, 2023 Fixed rate 0.64000% ¥4.0bn October 20, 2025 Effective fixed rate (Note 2) 0.85100% (Note 1) Refers to the Japanese yen TIBOR released by the Japanese Bankers Association; provided, however, that if there is no corresponding time period, it refers to the interest rate reasonably set by the agent by the straight-line method. (Note 2) While funds are borrowed at floating rates, the interest rates are fixed in effect by entering into interest rate swap agreements to hedge interest rate fluctuation risk. The figures are the interest rates calculated after taking into consideration the effect of interest rate swaps. ２． Investment Corporation Bonds Date of Rating Serial Determining Interest Rate Amount Issued Maturity Date Term Description Pricing Standard Lead Manager Number JCR Conditions Daiwa Securities Co., Ltd. October 6, 2015 1 0.961 % ¥2.0 billion October 10, 2025 10 years Without collateral or guarantee AA- Spread from JGB SMBC Nikko Securities Inc. SMBC Nikko Securities Inc. Mizuho Securities Co., Ltd. October 13, 2016 ２ 0.470 % ¥1.0 billion October 20, 2026 10 years Without collateral or guarantee AA- Interest rate Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. SMBC Nikko Securities Inc. Mizuho Securities Co., Ltd. October 13, 2016 ３ 1.200 % ¥1.0 billion October 20, 2036 10 years Without collateral or guarantee AA- Interest rate Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. SMBC Nikko Securities Inc. November 28, 2017 ４ 0.680 % ¥2.0 billion December 8, 2027 10 years Without collateral or guarantee AA- Interest rate Mizuho Securities Co., Ltd. Daiwa Securities Co., Ltd. SMBC Nikko Securities Inc. November 16, 2018 ５ 0.783% ¥15.0 billion December 7, 2028 10 years Without collateral or guarantee AA- Spread from JGB Mizuho Securities Co., Ltd. Daiwa Securities Co., Ltd. 60 Many Choices of Financing Methods According to Investment Unit Prices

Financing efforts in a way that contributes to an increase in distribution per unit and total market value. With the goal of achieving continuous growth in distributions and market value, AEON REIT will adopt optimal financing means at each point in time, factoring in assets to be acquired and market conditions.

Policy for financing means Method Points to be factored in  Investment unit price levels Consider financing mainly through public offerings whose possibility of a successful premium capital increase is Follow-on  Profitability of properties to strong. be acquired in future offerings A level at which urban-type and recently built properties,  DPU growth among other properties, whose cap rates are relatively low, can be considered as acquisition targets.

 Consider implementation as a new financing method Consider financing by combining follow-on offerings and borrowings while at the same time taking the dilution of distributions per unit into consideration, from the Hybrid financing  Utilize cash generating skills perspective of the profitability of properties to be acquired.  Balance between LTV and DPU

 Interest conditions

Loan-based  LTV levels Consider implementation by leveraging borrowings and funds on hand with priority financing  Balance between long-term fixed given to the improvement of profitability through property acquisition. loans and financing cost Consider implementing unit buy-backs if sufficient capital surpluses are available and the measure is considered very effective.  Utilize derivatives (interest swaps) Investment  Investment corporation bonds for corporation bonds the wholesale market Debt Hybrid Follow-on  Investment corporation bonds for (Subordinated individual investors financing bonds/loans) offerings 61 Summary of Malaysian Economy

Changes in GDP growth rate in Japan & Malaysia FTSE Bursa Malaysia KLCI Index trends

Trading volume trading volume closing price Closing price real GDP growth rate real GDP growth rate （mil RM） (Malaysia) (Japan) 900 2,000 800 7.4% 5.9% 6.8% 5.3% 5.5% 6.0% 700 6.3% 5.3% 4.7% 5.0% 1,500 4.8% 5.6% 600 1.5% 1.7% 4.2% 0.4% 1.7% 500 2.8% 1,000 4.2% 400 2.2% -0.1% 1.7% 0.1% 1.4% 1.5% 300 -1.5% -1.1% 500 200 -5.4% 100

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0 0

(Source） THE WORLD BANK DataBank (Source） Bloomberg Population growth in Malaysia (estimated figures for FY2018 onwards) Monthly trends of RM ／ Yen

（Millions of people）（yen） 35 40 30

25 35

20 30 15

10 25 5

0 20

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

2018E 2019E 2020E 2021E 2022E 2023E (Source） Bloomberg (Source） International Monetary Fund, World Economic Outlook Database 62 Scheme for acquisition of overseas property

Declaration-of-trust scheme was utilized to acquire overseas real estate as J-REIT’s first practice in June 2014. Overseas SPC scheme is utilized to acquire the second overseas real estate as J-REIT’s first practice.

Declaration-of-Trust Scheme (acquired in June 2014) Overseas SPC Scheme (acquired in September 2016)

AEON REIT Investment Corporation AEON REIT Investment Corporation (beneficiary) Holding a property Japan Japan Holding a 100% stake

Master Lease Master Lease Agreement Agreement JAMBATAN MANSEIBASHI (M) Sdn Bhd Real estate Malaysia Malaysia (exclusive of AEON CO. (M) BHD. AEON CO. (M) BHD. 全体の18.18% taxes) （beneficiary and master lessee）） (master lessee） Capital stock, 215 million （6.58億円） etc. RM* approx.239 (¥5,252 billion) million RM* Other assets (¥ 5,838 billion) approx.24 18.18% of total million （¥658 million） RM* Rights to hold in common (¥ 586 million) Trust beneficiary *1RM=24.43JPY (as of September 2016) interests of trust formed by declaration Holding a of trust property

Store operation Store operation

M-1 AEON Taman Universiti M-2 AEON MALL SEREMBAN 2 Shopping Centre

63 Relationship between the Fiscal Year of the Overseas SPC and the Settlement of Accounts of the Investment Corporation (Conceptual Diagram)

Overseas real estate acquired by an overseas SPC starts contributing to the full-year revenues of AEON REIT in the settlement for the following fiscal period (X+ 1 period). Although the overseas SPC has full- year accounting terms under the local laws, it is expected to pay interim dividends.

X-1 Period X Period X + 1 Period X + 2 Period

Announcemen Announcemen Receipt of interim Announcemen Receipt of t of results for t of results for dividends of the t of results for dividends of the X-1th the Xth fiscal overseas SPC the X+1th the overseas AEON REIT fiscal period period fiscal period SPC Investment Acquisition of shares Completed Corporation Marking-to-market in the overseas SPC acquisition of shares of properties owned in the overseas SPC Marking-to- market of by the overseas properties SPC on owned by the end of X+1th overseas SPC on Payment of period end of Xth interim period dividends Conclusion of after the the sales Acquisition of Implementation of numbers agreement property interim audit on are fixed by Implementation of SPC audit audit on SPC Overseas SPC Establishment Fiscal year- Fiscal year- end (SPC) end (SPC) of the overseas Payment of SPC dividends after the Income from the numbers are fixed by acquisition of audit property to end of Income from beginning of Xth period X+1th Period to end of X+1th period.

64 Currency Hedging Policy for Investment Capital (Overseas SPC Shares) and Dividends Exchange rate assumed for budgeting

 Assume conservative exchange rates at the time of drawing up budgets in consideration of exchange rate trends.  The exchange rate assumed for forecasts for the 13th period (ending July 31, 2019) and the 14th period (ending January 31, 2020) is ¥24.0(on January 31, 2019: ¥26.66).

Payment based on capital Payment of increase underwriting End of Xth fiscal period Fixing of dividends for agreement dividends for the Xth Conduct the Xth fiscal fiscal period Day A Day B audits of the period Overseas Overseas SPC SPC for the Xth fiscal period

Conclusion of purchase Receipt of rental income for Acquisition of shares agreement on shares the Xth fiscal period as issued by overseas real issued by overseas real dividends denominated in yen estate holding estate holding corporation corporation

Currency hedging Currency hedging period period

Overseas SPC Receipt of dividends from Property acquisition the Overseas SPC for the Xth fiscal period Currency hedging policy for investment capital Currency hedging policy for dividends received from the Overseas SPC (when acquiring the Overseas SPC shares)

⚫ Plan to hedge the investment capital (the Overseas SPC ⚫ For dividends received from the Overseas SPC, plan to shares) by concluding an exchange contract upon acquiring conduct hedging by concluding an exchange contract as of the shares. the end of the fiscal period in order to fix the dividend ✓ Conduct currency hedging for acquiring the shares at the exchange rate of amount denominated in yen the date when the acquisition is announced, so that there will be no difference between the yen-denominated acquisition price announced upon ✓ For share dividends paid by the Overseas SPC, conduct hedging by acquisition and the actual yen-denominated acquisition price concluding an exchange contract for the period from the finalization of the ✓ When the acquisition is conducted in the fiscal period following the fiscal dividend amount denominated in ringgit by the Overseas SPC to the period in which the announcement is made, currency hedging shall be receipt of the dividends by AEON REIT arranged by the end of the fiscal period in which the announcement is made, not extended into the following fiscal period, as a rule. ⚫ For the investment capital (the Overseas SPC shares), fix the acquisition price at the exchange rate of the day when the agreement is concluded 65 Comparisons between Retail Environments in Japan and the US

Comparison of the number of retail facilities Comparison of the EC ratio

Oversupply of retail facilities in the United States compared with the level in Japan The ratio of online stores in Japan is lower than in the United States, hovering at a 5% level in recent years. Japan US Comparison of the EC ratio between Japan and the United States

10.0% 8.9% Population Approx. Approx. 2.5 times （compared 8.0% (Note 1) 120 million 320 million to Japan） 6.0% Number of Approx. Approx. 14.5 times Large Malls （compared 4.0% 5.8% (Note 2) 3,000 46,000 to Japan） 2.0% Population per Approx. Approx. 5.6 times （compared 0.0% one Large Mall 39,000 6,000 to US） 2010 2011 2012 2013 2014 2015 2016 2017

（Note1）Population in Japan is as of Septenber 1, 2018(Homepage of Ministry of Internal Affairs and US Japan Communications). Population in the US is as of May 2018.(Homepage of US Federal Bureau) （Note2）Number of Large Malls in Japanis based on Japan Shopping Center Association SC White Paper 2017. (Note) Japan’s EC ratio: Graph prepared by the Asset Management Company based on the FY2017 Survey of Infrastructure Number of Large Malls in the US is based on CoStar, ICSC, Office J.K. Development Status for Data-driven Society in Japan (E-Commerce Market Survey) by the Ministry of Economy, Trade and Industry. The United States’ EC ratio: Graph prepared by the Asset Management Company based on data issued by the United States Census Bureau.

Comparison of retail facility characteristics

Retail facilities whose frequency of use by local people is high because all of the retail facilities owned sell food products

commercial facilities US owned by AEON REIT (ii) Tenant composition including time-consuming type facilities such ＧＭＳ（food items sales 60%) Department stores/ as a cinema and large food court. Core Tenants Large specialty stores / Movie Large specialty stores / Movie theater theater

Product sales: Approx. 65％、 (i) Food product area used by Tenants Product sales: Approx. 80％ Drinking and eating & visitors repeatedly. Composition services: Approx. 35％

Location and A range of means for store visits Store visits mainly by car due to due to shopping areas located means for store facilities located in the suburbs (iii) Store visits by a range of means such as by public visits nearby transportation, car, bicycle or on foot. （Note）Prepared by the Asset Manager based on Supplementary of 92th Financial Results for FY2017 of AEON Co., Ltd.. （Note）Prepared by the Asset Manager based on data of the properties owned by AEON REIT. （Note）Source: ICSC、Office J.K Image figure 66 Activities to Achieve Sustainability ～ Initiatives by AEON REIT～

Expects to obtain more than 10 environmental certifications, going forward, and continue to make environmental and social contributions. AEON REIT received GRESB Real Estate Assessment DBJ Green Building Certification Certification for CASBEE for Real Estate

AEON MALL AEON REIT achieved the AEON MALL Kurashiki AEON MALL Morioka AEON MALL Nogata AEON MALLKagoshima • Yamatokoriyama “Green Star” in three consecutive years AEONMALL KYOTO AEON MALL Mitouchihara AEON MALL Itamikoya

Activities to Safety Activities to Environment Asset Manager’s activities

• Transparent Decision-Making Process • The Corporate Governance Code was established by the Asset Management Company in March 2016 ahead ✓ A scheme is established to reflect the opinions of of other companies. third parties that have no interest in the Group with respect to stakeholder transactions. • The Sustainability Policy was established in January 2016. ✓ Decisions to be made at meetings of the • Companywide initiatives are promoted under the AEON MALL Kagoshima AEON MALL Nogata Investment Committee and Compliance Committee require attendance and agreement by leadership of the Sustainability Promotion Investment in the installation of anti-smoke hanging Actively implementing construction for outside experts who shall be third parties. Subcommittee (Chairman: President & Representative walls made of inflammable film and construction work environmental protection such as the Director). that contributes to reducing damages from replacement of air-conditioners and lighting with earthquakes LED

Property Investment amount Property Investment amount （millions of yen) （millions of yen)

AEON MALL Yamagata-Minami 30 AEON MALL Nogata 220(LED)

AEON MALL Kagoshima 58 AEON MALL Hiezu 37(air-conditioners)

AEON MALL Yokkaichi-Kita 34 AEON MALL Morioka 30(air-conditioners) Inclusion in the MSCI Japan ESG Select Leaders Index • Inclusion in the MSCI Japan ESG Select Leaders Index on July 3, 2017 • There are currently six J-REITs included in this index as of Dec.2018. • In July 2017, the Government Pension Investment Fund (GPIF) selected this index as one of the ESG indices used for passive investment. 67 Activities to Achieve Sustainability (AEON Group)

Governance Environment Establishment of Aeon Sustainability Principles AEON’s tree-planting projects AEON Carbon-free Vision 2050 Reduction of food waste

• In FY1991, AEON started tree-planting with Reduce CO2 emissions by 35% AEON's "zero waste” concept customers in numerous locations around the from the level in 2010 by 2030 world. • Dispose of and combust waste through the 3R and achieve zero emissions by approach of “reduce,” “reuse” and “recycle” to • The total number of trees planted so far eliminate reclamation. reached 11,66mil (as of February 28, 2018). 2050 at each store. • Contribute to building a resource-recycling system in cooperation with AEON’s customers and other stakeholders.

Social Collaboration with local communities Activities led by public interest AEON as a regional disaster incorporated foundations control base AEON 1% Club Foundation Established in 1989. Activities that have been conducted for • Exclusive local WAON approximately 30 years. cards ✓ Its main objectives are the development of the next generation, the promotion of friendships with foreign countries and the • Aeon Happy Yellow sustained development of local communities. Receipt Campaign」 ✓ Major AEON Group companies donate 1% of their pre-tax Inclusion in a range of trackers profits.

AEON CO., LTD. ■ MSCI Japan ESG Select Leaders Index ■ MSCI Japan Empowering Women Index (Select) Wellness & Diversity Management

■ The Nadeshiko Brand 2018 stocks AEON Environmental Foundation Aiming to raise the AEON Group’s female Established in 1990. Activities that have been conducted manager ratio to 50% by FY2020 AEON Mall Co., Ltd. for approximately 30 years. ■MSCI Japan ESG Select Leaders Index ■MSCI Japan Empowering Women Index (WIN) ■Nadeshiko Brand 2018 stocks (Only company selected in the real estate industry for the second consecutive year.)

68 Unitholder Information

Number of Unitholders and Number of Investment Units by Unitholder Type Number of Units Number of Unitholders

11th Period 12th Period 11th Period 12th Period (July 31, 2018) (January 31, 2019) (July 31, 2018) (January 31, 2019)

Number of Number of Number of Number of % of total % of total % of total % of total Investment Units Investment Units Unitholders Investment Units

Individuals and others 176,343 9.9% 155,952 8.8% 23,612 96.8% 22,058 96.7%

Financial institutions (including financial 849,993 47.8% 910,435 51.2% 167 0.7% 151 0.7% instruments firms)

Other domestic corporations 421,726 23.7% 415,151 23.4% 374 1.5% 362 1.6%

Foreign corporations 329,285 18.5% 295,809 16.6% 237 1.0% 248 1.1%

Total 1,777,347 100.0% 1,777,347 100.0% 24,390 100.0% 22,819 100.0%

Investment Unit Ownership Ratio by Unitholder Type Major Unitholders (As of January 31, 2019)

2017/1期 8th Prriod Number of % of 9.9% 56.3% 23.9% 9.9% Unitholder Name (Jan.2017)（第8期） Units Total

2017/7期 1 AEON Co., Ltd. 352,351 19.8% 9th Prriod 9.5% 51.3% 23.3% 15.9% (Jul.2017)（第9期） 2 The Master Trust Bank of Japan, Ltd. (trust account) 261,872 14.7% 2018/1期 3 Japan Trustee Services Bank, Ltd. (trust account) 237,125 13.3% 10th Prriod 10.2% 48.6% 23.6% 17.6% 4 The Nomura Trust & Banking Co., Ltd. (trust account) 68,171 3.8% （第(Jan.2018)10期） Trust & Custody Services Bank, Ltd. (securities investment trust 5 54,687 3.1% 2018/7期 account) 11th Prriod 9.9% 47.8% 23.7% 18.5% （第(Jul.2018)11期） 6 Sumitomo Mitsui Trust Bank, Limited 27,150 1.5%

2019/1期 7 Mizuho Bank, Ltd. 20,000 1.1% 12th Prriod 8.8% 51.2% 23.4% 16.6% （第(Jan.2019)12期） 7 Tokyo Century Corporation 20,000 1.1% 9 STATE STREET BANK WEST CLIENT - TREATY 505234 19,774 1.1%

個人・その他Individuals and Others 金融機関（金融商品取引業者含む）Other domestics Corporations 10 STATE STREET BANK AND TRUST COMPANY 505001 18,802 1.1%

その他国内法人Financial institutions 外国法人等Foreign Corporations Total 1,079,932 60.8%

69 Disclaimer

Disclaimer ― These materials contain forward-looking statements with respect to the future business results, plans, and management targets and strategies of AEON REIT Investment Corporation (AEON REIT). These forward-looking statements are based on assumptions made at the present time about future events and the operating environment. There is no guarantee that these assumptions are correct. Various factors could cause actual future results to differ materially from those expressed or implied by the forward-looking statements contained herein. ― While all reasonable measures have been taken to ensure that the information presented herein is correct, AEON REIT makes no assurance or guarantee as to the accuracy or completeness of that information. The contents of the information may be changed or eliminated without notice. ― These materials include analyses, judgments and other views based on information currently available to AEON REIT and AEON Reit Management Co., Ltd. As such, actual operating results may differ from these views. Furthermore, there are other views that differ from these, and AEON REIT and AEON Reit Management Co., Ltd. may change these views in the future. ― These materials are provided for the sole purpose of presenting general information and explaining the management strategies of AEON REIT, and are not intended as a solicitation to purchase AEON REIT’s investment units, nor to enter into any other financial instruments transaction agreement. When making investments, investors are advised to use their own judgment and discretion.

Disclaimer for Dutch Investors ― The units of AEON REIT Investment Corporation (“AEON REIT”) are being marketed in the Netherlands under Section 1:13b of the Dutch Financial Supervision Act (Wet op het financieel toezicht, or the “Wft”). In accordance with this provision, AEON Reit Management Co., Ltd. (the “AIFM”) has notified the Dutch Authority for the Financial Markets of its intention to offer these units in the Netherlands. The units of AEON REIT will not, directly or indirectly, be offered, sold, transferred or delivered in the Netherlands, except to or by individuals or entities that are qualified investors (gekwalificeerde beleggers) within the meaning of Article 1:1 of the Wft, and as a consequence neither the AIFM nor AEON REIT is subject to the license requirement pursuant to the Wft. Consequently, neither the AIFM nor AEON REIT is subject to supervision of the Dutch Central Bank (De Nederlandsche Bank) or the Netherlands Authority for Financial Markets (Autoriteit Financiële Markten). The AIFM is therefore solely subject to limited ongoing regulatory requirements as referred to in Article 42 of the European Alternative Investment Fund Managers Directive (European Directive 2011/61/EU) (the “AIFMD”). Please visit AEON REIT’s home page (https://www.aeon-jreit.co.jp/en/index.html) to access its latest annual report referred to in Article 22(1) of the AIFMD or information provided under Article 23 of the AIFMD.

Asset Manager: AEON Reit Management Co., Ltd. (Registration of financial instruments business: Kanto Local Finance Bureau, Director-General (Financial Instruments), No. 2668)

Contact Information Please contact us if any questions: AEON Reit Management Co., Ltd. Finance and Planning Department TEL: 03-5283-6361