Real Estate Business Top Interview Top Top Message/ Top

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Review of Operations: Real Estate Business Top Interview Top Top Message/ Top

Financial Highlights We provide a full line of real estate services Our Business Model,

Status of Group Businesses/ Status of Group from brokerage to securitization and investment management.

Naoya Shoji Officer in charge of Real Estate Business Sumitomo Mitsui Trust Bank, Limited New Midterm Special Feature Management Plan/

1. Business Outline

Our Real Estate Business has a large number of real pertaining to real estate. Additionally, we are making ev- estate specialists, such as real estate appraisers and ﬁ rst- ery effort to globalize our Real Estate Business in order to class registered architects, providing a full line of services meet the needs of overseas investors seeking to invest in Topics from brokerage to securitization and investment manage- Japanese real estate and the needs of domestic clients ment in response to the real estate-related transaction seeking to expand overseas. Sumitomo Mitsui Trust Group/ Sumitomo Mitsui Trust Comprehensive Capabilities of Comprehensive needs of a wide range of clients, including large corpora- Furthermore, we deploy highly skilled personnel with tions, domestic and foreign investors, and individuals. expertise in real estate in the major offices of the Retail In our real estate transaction services covering real es- Financial Services Business and the Wholesale Financial tate brokerage, consulting and real estate securitization Services Business, and encourages these units to work in arrangement, we provide distinctive services that are un- collaboration with the Real Estate Business. like those of other companies through consulting based We will continue our efforts to provide clients with total on wide information networks and signiﬁ cant expertise. In solutions that only a trust bank can offer, and instill in them Review of Operations our real estate investment management covering manage- a sense of security and trust. ment of J-REITs (Japanese Real Estate Investment Trusts) and private real estate funds, we draw on our real estate • Real Estate Business Model information gathering capabilities and critical appraisal Real Estate skills to provide investors with information and propose Transaction Services (Brokerage, Consulting, products. In our real estate infrastructure services, which Securitization Arrangement)

include real estate appraisal services and real estate trusts, Through consulting based on wide information networks and significant expertise, we provide distinctive

Management Structure we have been streamlining our operations to improve the services that are unlike those of other companies.

operational structure and provide high-quality services. Real Estate Real Estate Investment Management Infrastructure Services Through the flexible coordination of these services, all (Management of J-REITs, (Real Estate Trusts, Private Real Estate Funds) Appraisal Services) possible opportunities can be explored. We take advantage of our real estate information We have undertaken the rationalization of We are actively working to develop the environmentally gathering capabilities and critical appraisal skills to operations to improve our operational provide investors with information and make structure and provide high-quality services. friendly property business, which is expected to grow in product proposals. tandem with the tightening of environmental regulations Corporate Data

42 Sumitomo Mitsui Trust Holdings, Inc. 2014 Annual Report Review of Operations: Real Estate Business Top Message/ Top Interview

2. Product and Service Outline Status of Group Businesses/ Our Business Model, Financial Highlights

Real Estate Transaction Services

Real Estate Brokerage We take advantage of our vast experience and an extensive network to implement various procedures, ranging from survey of properties to price negotiations and the transfer of ownership for a wide range of properties,

including ofﬁ ce and condominium sites, factories, and commercial facilities. Management Plan/ Special Feature Sumitomo Mitsui Trust Realty Co., Ltd., under the umbrella of Sumitomo Mit- New Midterm sui Trust Bank, Limited (“SMTB”), takes the central role in real estate brokerage for housing for individuals and small-sized commercial properties.

Consulting on Effective Use of Real Estate and in Construction We take maximum advantage of know-how accumulated in overall real Comprehensive Capabilities of Sumitomo Mitsui Trust Group/ estate operations to provide various real estate consulting services to help clients effectively utilize their land and buildings.

In our CRE (Corporate Real Estate) consulting service, we review real es- Topics tate property holdings and utilization strategies that are consistent with clients’ corporate strategies, and analyze client-owned properties to propose strategies for making the most efﬁ cient real estate investments in order to enhance corporate value. We are also making active efforts to provide comprehensive construction Review of Operations consulting services, ranging from project planning to post-construction building management, as well as consulting services on environmentally friendly building construction that cover energy conservation, landscape considerations, ways for extending the life of a building, and the incorpora- tion of recycling systems. aaeetSrcueCorporate Data Management Structure

Sumitomo Mitsui Trust Holdings, Inc. 2014 Annual Report 43 Review of Operations: Real Estate Business Top Interview Top Top Message/ Top

Real Estate Securitization Arrangement Real estate securitization has been widely used as a real estate investment tool as part of a company’s ﬁ nancial strategies. As a pioneer that has been actively involved in real estate securitization since the early stage of securitization, SMTB provides one-stop real estate securitization services covering the identification of client needs; the evaluation of real estate properties; Financial Highlights Our Business Model, arrangement (coordinating related parties and building a structure for secu- Status of Group Businesses/ Status of Group ritization); fund-raising for equity-tranche; fund-raising for debt-tranche; and real estate management and operation after securitization.

• Real Estate Securitization Schemes and the Role of SMTB

Originators New Midterm ▼

Special Feature Corporate (Owners of Management Plan/ Business SPC Debt Investors Original Assets Departments (Real Estate)) (Special Purpose Company)

Real Estate

Lease Liabilities Finance Department Providing Loans, etc.

Topics Real Estate Assets such as Custody Business Real Estate, etc. Department Real Estate Transfers Investments Capital Equity Investors Sumitomo Mitsui Trust Group/ Sumitomo Mitsui Trust Comprehensive Capabilities of Comprehensive

Real Estate Business Arrangement Solution Department, Arrangement Each Real Estate Each Department Business Department of SMTB Review of Operations Management Structure Corporate Data

44 Sumitomo Mitsui Trust Holdings, Inc. 2014 Annual Report Review of Operations: Real Estate Business Top Message/ Top Interview

Real Estate Investment Management Status of Group Businesses/ Our Business Model, Financial Highlights

Real Estate Investment Advisory Services We are developing business related to real estate investment advisory services. This includes providing investment information services for investors, as well as determining the composition of and offering real estate investment products. We provide investors with comprehensive management services com- bining various real estate-related functions, and with information and in-

vestment advice utilizing our analytical capabilities regarding investment Management Plan/ Special Feature market trends, and the investment values and risks of structured real estate New Midterm ﬁ nance products. Regarding J-REITs (Japanese Real Estate Investment Trusts), we provide advice on the acquisition and management of assets for investment, and support stable growth of J-REIT investment companies. We not only un- dertake general administrative services and asset custody procedures on Comprehensive Capabilities of Sumitomo Mitsui Trust Group/ behalf of the client, but also provide various support services based on past achievements and the know-how of SMTB, which has developed REIT products serving as the sponsor. Topics

• Flow of Real Estate Investment Consulting Services

Real Estate Investment Consulting Collecting Property Information Review of Operations UÊIntroducing properties eligible for investment Drafting Business Plans Offices, commercial facilities, Property Surveys houses, distribution facilities, UÊSupporting real estate hotels, properties with UÊSupporting property surveys investment fund schemes development opportunities Surveying prices Advising on fund concepts Analyzing markets Proposing schemes Conducting different types of Drafting schedules due diligence Advising on revenue and Checking the investment’s

expense plans eligibility and legality Corporate Data Management Structure The Stages of Property Sales and Real Estate Investment Property Acquisitions and Investment Recovery Investment UÊSupporting property sales UÊSupporting property Proposing sales methods acquisitions Undertaking sales procedures Negotiating acquisition Searching for buyers prices and terms Negotiating sales prices and Supporting the preparation terms of statutory documents Asset Management and Closely examining and Administration preparing property materials Checking documentation UÊAsset administration Checking securitization The Group administers only assets put into our trust. The Group strictly separates administrative operations.

Sumitomo Mitsui Trust Holdings, Inc. 2014 Annual Report 45 Review of Operations: Real Estate Business Top Interview Top Top Message/ Top

Real Estate Infrastructure Services

Real Estate Trusts In order to meet the growing need for trust services in the real estate securitization market, we are promoting the rationalization of operations us- ing a real estate total management system (“SMART”) and enhancing our Financial Highlights Our Business Model, business structure. We have also been improving computer system func- Status of Group Businesses/ Status of Group tions to meet client needs, launching a service in January 2008 that allows investors and other clients to make inquiries about accounting information via the Internet.

• Real Estate Total Management System’s Internet Functions

New Midterm (for External Inquiries) Special Feature Management Plan/

SMTB Real Estate Asset Custody Business management Department company

Instructions

Topics Internet

Input Security ensured Sumitomo Mitsui Trust Group/ Sumitomo Mitsui Trust

Comprehensive Capabilities of Comprehensive through use of Internal Client Referable at one-time password server inquiry server anytime Feedback with documents Updated nightly, with inquiries processed on a daily basis Previous data flow

Review of Operations Real Estate Appraisal and Assessment Accompanying such developments as the convergence of Japanese accounting standards with international standards, an acceleration in corporate mergers and acquisitions, and the expansion of CRE (Corporate Real Estate) strategies and real estate securitization, there is an ever growing need for real estate appraisal and assessment services that allow clients to know the value of their real estate properties in the ﬁ rst stage when con-

Management Structure sidering real estate property holding and utilization strategies. The Group has earned high marks as an authoritative real estate appraisal agency with a large number of well-experienced real estate appraisers who have won a large number of appraisal and assessment orders from many private sector companies and public organizations. We will continue to take maximum advantage of our accumulated expertise to provide high-quality appraisal and assessment services. Corporate Data

46 Sumitomo Mitsui Trust Holdings, Inc. 2014 Annual Report Review of Operations: Real Estate Business Top Message/ Top Interview

3. Group Companies Status of Group Businesses/ Our Business Model, Financial Highlights

Sumitomo Mitsui Trust Realty Co., Ltd. Sumitomo Mitsui Trust Realty provides not only brokerage services for the sale and purchase of residential properties, including land, single-family houses and condominiums, but also various services regarding real estate transactions for investment and business purposes utilizing the Group’s na- tionwide network. The company promptly responds to inquiries about the effective utilization, inheritance and donation of real estate, and also about Management Plan/

housing loans. Special Feature New Midterm

Sumitomo Mitsui Trust Real Estate Sumitomo Mitsui Trust Real Estate Investment Management plays a role in Investment Management Co., Ltd. the Group’s asset management business as a real estate investment management company, managing private real estate funds for investors, mainly institutional investors. Taking advantage of the Group’s comprehensive real Comprehensive Capabilities of estate capabilities, namely its powerful information network, real estate Sumitomo Mitsui Trust Group/ brokerage function, real estate trust function, and professional construction consulting and due diligence functions, the company provides fund management and asset management services. Topics

Top REIT Asset Management Co., Ltd. Top REIT Asset Management is a J-REIT (Japanese Real Estate Investment Trust) asset management company sponsored jointly by Sumitomo Mitsui Trust Bank, Limited and Oji Real Estate Co., Ltd. It is an asset manager for

TOP REIT, Inc., investing mainly in office buildings, commercial facilities Review of Operations and residential real estate properties, utilizing the “real estate and ﬁ nancial know-how” of its sponsors, which have their own unique features.

Mitsui & Co., Logistics Partners Ltd. Mitsui & Co., Logistics Partners was jointly established by MITSUI & CO., LTD. and Kenedix, Inc. as an asset management company for J-REIT. It manages Japan Logistics Fund Inc. (JLF), which is the ﬁ rst Japanese REIT dedicated to logistics properties in Japan and invests in various domestic aaeetSrcueCorporate Data Management Structure logistics facilities.

Sumitomo Mitsui Trust Sumitomo Mitsui Trust Research Institute is a think tank specializing in real Research Institute Co., Ltd. estate. It conducts studies and proposals on urban problems, and theoreti- cal and practical studies on real estate. Based on the accumulation of such studies, it provides clients with research and consulting services specializing in the real estate market and the real estate ﬁ nance area.

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