Activia Properties Inc. Financial Results Presentation for the 14th Fiscal Period (November 2018) January 2019
（Security Code: 3279/API） 1. Financial Highlights
2. Internal Growth, External Growth, Financial Strategies and ESG
3. Financial Forecasts
4. Others
5. Acquisition Highlights
6. Appendix 1. Financial Highlights Highlights of the Period Ended November 2018 (the 14th Period) and Onwards 2
Internal Growth External Growth Financial Strategies Progressively achieved Conducted the 6th PO to Further lowered through tenant replacement enhance API’s portfolio quality average interest rate Tokyu Plaza Q plaza EDGE w/rent rise and upward rent UR-16 UR-17 AA-13 ■Refinanced ¥23.6bn and newly borrowed Ginza (Land) HARAJUKU Shinsaiba shi ¥35bn from the 14th Period onwards revision in each category Acquisition price: Acquisition price: ¥37.5bn ¥13.2bn Acquisition price: Ave. interest rate: 0.66％ → 0.58％ (30% co-ownership (60% co-ownership ¥19.8bn Tokyo Office interest) interest) ■Upward rent revision in 3,262 tsubo in the Ave. period remaining: 4.6 years → 4.4 years ■AUM ¥ bn (as of May 31, 2018) (as of Jan. 17, 2019) 14th Period and uptrend continues in the 502.0 to maturity ■Acquisition 15th & 16th Periods approx. ¥44.5bn Began preparation for Capacity Retail properties （as of Jan. 17, 2019） issuance of Green Bonds ■Change in rent of ¥44mn/period from the Replaced assets at the PO ■Amendment to the shelf registration statement 14th Period onwards allowing stable earning (disposed A-FLAG AKASAKA) to submit simultaneously with the financial secured in long term statement disclosure for issuance of API’s first Activia Account (office) UR-6 UR-17 ■Gain on sale will be green bonds Replace recorded over the Offer ESG investment ■Rent increase achieved in 648 tsubo in the A-FLAG ment Q plaza two periods １opportunities AKASAKA HARAJUKU Strengthen 14th Period and already achieved in over ending May 2019 and ２Promote ３ 1,000 tsubo in the 15th Period ending Nov. 2019 ESG initiatives financial formation
Continual growth in unitholders’ value Achieved increase in DPU Achieved continual growth
DPU: ¥9,584 (period ended Nov. 2018) in NAV per unit NAV per unit: ¥437,302 (end of Nov. 2018) (vs. May 2018: +¥122 / +1.3% ) (vs. end of May 2018: +¥10,991 / +2.6%) (vs. forecast: +¥84 / +0.9% ) 1. Financial Highlights Financial Results for the Period Ended Nov. 2018 (the 14th Period): Statement of Income 3
Both revenue and profit increased vs. the 13th Period results and the 14th former forecasts due to (i) full operation of the 3 properties acquired in connection with previous PO and (ii) consistent internal growth DPU is ¥9,584, up ¥122 from the previous period and up ¥84 from the former forecast 1. 14th Period actual vs. 13th Period results/ 2. Variance analysis (vs. 13th results) former 14th Period forecasts（2018.7.13）(in millions of yen) (in millions of yen) 13th 14th Period 14th Period vs. 13th Details Period (period ended Nov. 2018) (forecasts) results vs. 13th Period Change Full-period operation +225, sales-linked rent at hotels +203, Forecasts Increase Utilities fee income +144, Other revenue +10, Results Results (vs. former Operating Difference (%) 2018.7.13 +488 Cancellation penalty +7, Facility usage fee +3 forecasts) revenue Existing rent -102, Parking lot fee -4, Restauration works fee Operating Decrease 13,327 13,815 +488 +3.7% 13,717 +97 -1 revenue Full-period operation +71, Utilities expense +120, Operating Taxes & Public dues +92, Repair & Maintenance expenses +7.1% Expenses Increase 5,855 6,268 +413 6,230 +38 +53, Depreciation +26, Other expenses related to rent expenses related to rent +370 business +16 business Taxes & Advertisement fee -5, Administrative service fee -3, 895 988 +92 +10.3% 987 +0 Decrease Public dues Payment commission -2 NOI after Operating profit 7,471 7,546 +75 +1.0% 7,487 +59 +118 depreciation Ordinary profit 6,611 6,697 +85 +1.3% 6,639 +58 General Increase Asset management fee +43, Miscellaneous expenses +1 administrative +43 Profit 6,610 6,696 +85 +1.3% 6,638 +58 expenses Decrease Taxes & Public dues -2 Operating +75 DPU ¥9,462 ¥9,584 +¥122 +1.3% ¥9,500 +¥84 profit
3. Variance between the 14th and the 13th Period results 4. Variance analysis (vs. 14th former forecasts) (DPU) (in millions of yen) vs. 13th Period vs. 14th former Details +¥122 forecasts Rent of existing properties +46, Facilities usage fee +22, ¥ Operating Increase Other fees +19, Utilities fee +4, Restoration work fee +2, 9,584 +97 ¥9,462 revenue Cancellation penalty +2 Decrease Expenses Repair & Maintenance +24, Utilities expenses +12, Operating Rent General Interest Expenses Increase related to rent +40 Administrative service fees +9, Depreciation +4 revenue business administrati expenses related to business Decrease Other rent business expenses -6, Advertisement fee -3 expenses ve expense and others PO NOI after +¥699 -¥530 -¥62 +¥26 -¥12 +57 depreciation General Increase Asset management fee +8 ～ ～ administrative -1 expenses Decrease Miscellaneous expenses -7, Payment commission -1 Operating +59 Results of period Results of period profit ended May 2018 ended Nov 2018 (13th Period) (14th Period) 1. Financial Highlights Financial Results for the Period Ended Nov. 2018 (the 14th Period): Balance Sheet 4
Balance at the end of the 14th Period marks no significant fluctuation compared to the previous period as no property acquisition recorded, though AUM decreased by ¥0.5bn LTV stood at 44.8％, slightly increased from the previous period, and unrealized gain grew to ¥81.7bn, up ¥7.6bn from the previous period due to lowered Cap Rate and improved NOI by internal growth 1. Comparison of the 13th and 14th Periods (in millions of yen) ２. Changes in LTV 13th Period 14th Period End of the End of the Change (2018/5) (2018/11) 13th Period 14th Period Change (2018/5) (2018/11) Assets Current assets 13,770 14,237 +466 44.7% 44.8% +0.1pt Cash and deposits 12,615 13,090 +475 Other 1,155 1,146 -8 Non-current assets 432,171 431,227 -943 Total property, plant and Depreciation -1,267, 421,768 420,854 -913 equipement Capital expenditure +352, Other +2 Total intangible assets 9,132 9,132 +0 Other 1,270 1,240 -29 Total assets 445,941 445,464 -477
Liabilities Short-term borrowings 9,100 9,100 +0 Tenant leasehold and security deposits Long-term loans payable to be -1,110, unpaid consumption tax +457, 18,500 19,600 +1,100 repaid within a year Other +112 Investment corporation bonds 14,000 14,000 +0 Long-term loans payable to be 153,750 152,650 -1,100 repaid within a year Tenant leasehold and security ３. Changes in unrealized gain on portfolio 26,814 26,272 -541 deposits (in millions of yen) End of the End of the Total liabilities 222,164 221,622 -541 Change 13th Period 14th Period Net assets Unitholder's equity 223,777 223,842 +64 74,088 81,702 +7,614 Unitholders' capital 217,091 217,091 +0 Surplus 6,686 6,750 +64 Cap Rate lowered in 10 properties Total net assets 223,777 223,842 +64 NOI improved in 13 properties (out of 42) Total liabilities and net assets 445,941 445,464 -477 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～Management of Office Properties 1～ 5
Continuous uptrend 1. Upward rent revisions (Tokyo Office properties) in the 15th Period Rent increase achieved for 13 consecutive periods from the 4th Period ended Nov. 2013 and onwards Rent increase in 2nd & 3rd revisions to the 16th Period ending Nov. 2019 (from 14th Period onwards） (tsubo） Area subject to 10,345 Maintained high increase even from 7,00010,000坪 Area (Up) Area (Down) 改定対象面積 増額面積 減額面積 lease renewal tsubo 2nd revision onwards 6,000坪 Increase in 2nd & 3rd Total leasable area +5.2% revisions (area) (Tokyo Office) +5.6% +7.3% 5,0005,000坪 +4.8% 5,343 ～ 25％ 1回転目増額1st cycle 5,336 34,709 tsubo tsubo tsubo 2回転目増額2nd cycle 4,0004,000坪 3回転目増額3rd cycle 3,000坪 Ave. rent 3,000 increase 4,879 +7.1% 4,728 4,977 tsubo +10.7% tsubo tsubo in 2nd & 3rd 2,0002,000坪 rent revisions +12.9% 3,262 2,299 tsubo 2,614 +8.6% 1,987 tsubo +8.5% 1,0001,000坪 +6.8% +7.5% 1,355 tsubo tsubo 974 tsubo 537 +3.6% 547 tsubo 535 Average tsubo 0坪 tsubo tsubo increase 0 69 626 tsubo 159 47 17 tsubo tsubo tsubo tsubo in 1st revision 1,000-1,000坪 (as of Dec.31, 2018) +7.2% 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11 2019.5 2019.11 (4th (5th (6th (7th (8th (9th (10th (11th (12th(12th (13th (14th (15th (16th Total rent-increased area (第4期) (第5期) (第6期) (第7期) (第8期) (第9期) (第10期) (第11期) (第12期) (第13期) (第14期) (第15期) (第16期) Period) Period) Period) Period) Period) Period) Period) Period) period)Period) Period) Period) Period) Period) 6,411 tsubo 2. Trends in average rent and rent gap *Figure above bar graph represents rent increase in each period Increased rent with securing capacity for further internal growth backed by widening rent gap Tokyo Office properties (overall) Tokyo Office properties (in greater Shibuya area) (per month per tsubo) (per month per tsubo) Tokyo Office properties (Greater Shibuya) 28,000¥28,000円 TOTokyo平均賃料 Office properties (overall) 28,000¥28,000円 広域渋谷圏平均賃料 マーケット平均賃料Market rent マーケット平均賃料Market rent 26,000¥26,000円 26,000¥26,000円
24,000¥24,000円 24,000¥24,000円 -5% -8% -9% -6% ¥22,000 22,000¥22,000円 -6% -6% -6% 22,000円 -4% -16% -19% -16% ¥20,000 +5% -3% ¥20,000 +3% -15% 20,000円 20,000円 -16% -18% -15% -18% ¥18,000 -1% *Excludes TAMACHI SQUARE (Land) ¥18,000 -5% -15% 18,000円 18,000円 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.112018.11 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.112018.11 (第(4th4期 ) (第(5th5期 ) (第(6th6期 ) (第(7th7期 ) (第(8th8期 ) ((9th第9 期) (第(10th10期 ) (第(11th11期 ) (第(12th12期 ) (第(13th13期 ) ((14th第14期) ((4th第4 期) (第(5th5期 ) (第(6th6期 ) (第(7th7期 ) (第(8th8期 ) (第(9th9期 ) (第(10th10期 ) (第11(11th期) (第12(12th期) (第13(13th期) (第14(14th期) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～Management of Office Properties 2～ 6
1. Offices of Activia Account properties 2. Rent increase achieved at tenant replacement Large-scaled internal growth achieved at tenant replacement in the Lineup with high competitiveness and upside potential 14th Period and onwards EDGE Umeda Rent increase Ave. rent increase AA-13 AA-10 世界有数の賃料水準 世界有数の賃料水準 Shinsaibashi Gate Tower +16% Located in Umeda, center of Osaka Rare and convenient location Increase facing Midosuji street Large-sized office building with a GFA Ave.世界有数の賃料水準 free-rent period approx.6,700 tsubo 100 Standard floor of 374 tsubo, % 1.8 months scarce size in Shinsaibashi area A-PLACE AA-6 Ave.世界有数の賃料水準 down-time period Kanayama Subject to replacement Osaka Nakanoshima months AA-7 Only 1-min walk from station 11 blocs in 1,380 tsubo 0.4 Building Standard floor area over 300 tsubo *Includes blocs scheduled to be leased Only 1-min walk from station
Located in Nakanoshima area with concentration of offices 3. Example of strategic replacement upon tenant departure Average rent Market rent A-PLACE AA-11 ¥ 13.4 ¥ 15.7 Rent increase achieved without down-time by capturing needs Bashamichi thousand / thousand / for floor increase and timely leasing Only 1-min walk from station tsubo tsubo Located in area where further Rent gap Leasing example in TLC Ebisu Building development is expected -17％ Company A Company B 8th floor (departed) 8th floor (moved to larger 243 tsubo 243 tsubo area-floor) till Dec. 2018 Trend in rent revision from Jan. 2019 4,906 Company B Rent 4,115坪 CompanyＣ (tsubo) 4,432 tsubo 4th floor (scheduled to 4th floor Area subject to increase 4,0005,000坪 増額面積Area (Up) 減額面積Area (Down) tsubo4,115 145 tsubo depart) (scheduled) 4,000坪 改定対象面積lease renewal 145 tsubo 3,000坪 tsubo till Mar. 2019 +17.1％ from Mar. 2019 Total leasable area (Activia Account office) 2,991 2,500坪 tsubo 20,840 tsubo +4.3% Forward-thinking operation going beyond 2,113 +12.3% ～～ location and quality 2,000坪 2,0002,000坪 tsubo
1,500坪 +8.1% Generate opportunities to realize internal growth through rent revision, tenant change with rent raise, etc. 1,0001,000坪坪 1,923 1,000 tsubo 1,277 1,009 tsubo Understand Value-enhancing Proactively increasing 500坪 1,009tsubo坪 Relation with PM +7.3% +11.9% 648 tenant needs construction work rents tsubo Pursue 2 or 3 265 tsubo 255 tsubo Satisfaction survey to Boost motivation of PM 0坪0 Maintain & improve consecutive rent 0坪 360 identify and resolve through an awarding property value revisions for the same tsubo 97 tsubo issues program tenant 500坪 Accelerate proactive operations by leveraging the expertise of the 2016.11 2017.5 2017.11 2018.5 2018.11 2019.5 2019.11 Sponsor Group (第(10th10期 ) (第(11th11期 ) (第(1212th期) (第(13th13期) (第(14th14期) (第15(15th期) (第(16th16期) Period) Period) Period) Period) Period) Period) Period) *Figure above bar graph represents rent increase in each period 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～Management of Retail Properties 1~ 7
1. Balance stability with profitability of retail properties 3. Management status of retail properties
Occupancy rate Fixed rent ratio Rent increase (Year-on-Year) (stabilized per period Sales transition (as of Nov. 30, 2018) (13th & 14th Periods results) from the 14th Period onwards) 99.9% 96% +¥44mn Sales remains stable in Tokyu Plaza Omotesando Harajuku / Large expansion in DECKS Tokyo Beach Stability of term (Diversification of lease termination) (tsubo) (as of Nov. 30, 2018) 20,000 120% Tokyu Plaza Omotesando DECKS Tokyo Beach 24.3% Harajuku東急プラザ表参道原宿 デックス東京ビーチ 11% of total lease Ave remaining period to Total leasable contracts will terminate lease end 15,000 area by the 19th Period 8.6 yrs 110% （Retail properties） 69,040 tsubo 10,000 100% 8.1% 5,000 3.0% 3.8% 3.6% 90% 1.4% 1.4% 1.4% 0.4% 1.1% ave. 14th Period 0 2017年11月期 2018年5月期 2018年11月期 2019年5月期 2019年11月期 2020年5月期 2020年11月期 2021年5月期 2021年11月期 2022年5月期 2022年11月期 2023年5月期 2023年11月期 80% Nov. 2017 May 2018 Nov. 2018 May 2019 Nov. 2019 May 2020 Nov. 2020 May 2021 Nov. 2021 May 2022 Nov. 2022 May 2023 Nov. 2023 DECKS Tokyo Beach 111% (12th(第 12Period)期) (13th(第13 Period)期) (14th(第14 Period)期) (15th(第15 Period)期) (16th(第16 Period)期) (17th(第17 Period)期) (18th(第 18Period)期) (19th(第19 Period)期) (20th(第20 Period)期) (21st(第21 Period)期) (22nd(第22 Period)期) (23rd(第23 Period)期) (24th(第24 Period)期) Tokyu Plaza Omotesando Harajuku 102％ 70%0％ 2017 6月 12月 2018 6月 2. Internal Growth timely achieved Jun. Dec. Jun.
Internal growth achieved in recent periods 12th Period (Nov. 2017) 13th Period (May 2018) 14th Period (Nov. 2018) where large tenant leases expired Trends in rents at end of periods (rent at the end of period immediately preceding acquisition of the property indexed as 100) UR-10 Q plaza SHINSAIBASHI UR-9 A-FLAG SHIBUYA Rent increase achieved by replacement
120 tenant 110 vs. former tenant +6% replacement w/ tenant rent increase in at end of the Replaced w/o down-time 361 tsubo replacement w/ UR-12 A-FLAG BIJUTSUKAN DORI 110 14th Period 105 both on 1st & 2nd floors % rent increase in +25 120 727 tsubo at end of the +9% 14th Period 107 100 100 office 2F former tenant 2F apparel /show room apparel (apparel 900 950 company company 9th 14th 14th company） foreign-funded 5th 1F 1F 1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 car dealer UR-3 Q plaza EBISU UR-12 A-FLAG BIJUTSUKAN DORI Under- Under- 105 tenant 105 tenant ground Jazz club ground Jazz club replacement w/ replacement w/ rent increase in rent increase in 283 tsubo 191 tsubo at end of the Succeeded in closing contract with Structure limiting tenants (duplex) +7% at end of the +6% 14th Period favorable conditions 100 100 103 14th Period Implemented leasing activities with Improved revenue stability due to its 102 possibility to divide floor contribution to rent revenue & tenant diversification
9500 950 2nd 14th 11th 14th 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～Management of Retail Properties 2～ 8
1. Urban Retail properties with hotel zone Stable 2. Proactive operation in Urban Retail properties Overview of each hotel management Cycle for improvement in Highly competitive due to high visibility of the building as landmark （based on the 13&14th Periods results） attractiveness and profitability and excellent accessibility Fixed-rent Tokyu Plaza A-FLAG Kobe Kyu Kyoryuchi Continually strengthen foundation for Property Akasaka SAPPORO 25Bankan future internal growth 81％
Invite attractive tenants Synergy Improve property’s potential Akasaka Excel Hotel Sapporo Tokyu Hotel Oriental Hotel Tokyu REI Hotel (Operator) (Plan・Do・See) (Tokyu Hotels) (Tokyu Hotels) Inbound sales ratio
1-min walk from 5-min walk from 2-min walk from Efficient proactive operation through co-operation Location Akasaka-mitsuke Kyukyoryuchi・ Susukino Station Station Daimarumae Station with Sponsor Group 13％ Implementation of flexible renewals, investment gimmick and timely # of promotional events 487 575 116 rooms Examples Trend in sales-linked rent at hotels Installation of “Seaside place” Decrease caused by earthquake is expected in the sales-linked rent in the 16th Period Trend in sales-linked rent An open place faced to Odaiba Kaihin Park with Even period：Tokyu Plaza Akasaka, （in millions of yen) artificial lawns and mist spraying to offers a A-FLAG SAPPORO refreshing moment to visitors Odd period：Kobe Kyu Kyoryuchi 276.9 276.9 Project certified by the 2020 Tokyo Olympics and 25Bankan 223.7 198.7 heat island measures by Government of Tokyo (subsidy granted) 66.4 73.8 73.9 DECKS Tokyo Beach
Installation of more toilets for visitors 20172017.5年5月期 20172017.112017.11年11月期 20182018.52018.5年5月期 201820182018.112018.11年1111月期 201920182019.52019.5年年55月期月期 201920182019.112019.11年11月期 (11th((第第 11Period)11期期)) (12th((第第12 12Period)期期)) (13th((第第1313 Period)期期)) (14th(((第第1414 Period)期期))) (((15th第第(第151515期予想期予想 Period)期予想))) ((16th第(第1616期予想 Period)期予想) ) (forecast) (forecast) Tokyu Plaza Omotesando Harajuku Trend in operation (average of 3 hotels) Installed more ladies toilet booths Occupancy rate of hotel rooms RevPAR (Y-on-Y) In objective to relieve congestion
Ave. of 13th & 14th Periods: 86% Ave. of 13th & 14th Periods: 101% and improve visitors convenience 100% 91% 92% 108% 89% 89% 89% 87% 87% 110% 105% 106% 106% 86% 86% 103% 103% 103% 90% 83% 102% 102% 78% 99% A-FLAG SAPPORO 97% 80% 73% 100% Installed more universal-designed Earthquake in 70% Hokkaido toilet booths 90% Both visitors satisfaction and 60% Earthquake in Hokkaido 82% accessibility improved 50%0％ 80%0％ 2018 2018 Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. 12Dec.月 1 Jan.月 2Feb.月 3Mar.月 4Apr.月 5May月 6Jun.月 Jul.7月 Aug.8月 Sep.9月 Oct.10月 Nov.11月 12Dec.月 1Jan.月 Feb.2月 Mar.3月 Apr.4月 May5月 Jun.6月 Jul.7月 Aug.8月 Sep.9月 Oct.10月 Nov.11月 13th Period ended May 14th Period ended Nov. 13th Period ended May 14th Period ended Nov. 2018 2018 2018 2018 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～New retail tenants～ 9
Numerous attractive tenants opened their shops in result of different leasing approaches
UR-9 A-FLAG SHIBUYA
Scheduled to open Shibuya is an area where they had always wanted to open shops on Mar.15, 2019 Deciding factors The property is located in an area of especially heavy foot traffic in for tenant “GU”, a top-class apparel Shibuya, and high ability to attract customers is expected over to choose the brand property long periods of time thanks to many development projects around Its only one shop in Shibuya the area area
UR-12 A-FLAG BIJUTSUKAN DORI AA-13 EDGE Shinsaibashi
Opened on Opened on Nov. 15, 2018 Jan. 4, 2019
A flagship store of “DS Wedding facility operated by Automobiles” by Peugeot DD Holding Group, a restaurant Citroën Japon Unorthodox facility fitting French luxury brand launched Shinsaibashi, an area rich in in Japan on full scale uniqueness
Deciding factors Located in a center of fashion and trend Deciding factors for Favorable location in Minami, center of Osaka for tenant The property fits luxury image of the brand tenant Elevator dedicated to the floor
TO-17 A-PLACE Shinbashi Ekimae
Opened on Opened on Aug. 27, 2018 Sep. 1, 2018
Membership shared workspace A convention rooms rental by by Tokyu Land Corporation TC Forum, a Tokyu Fudosan Holdings Group company Brand’s 7th space & has the Room of 577㎡ can biggest area accommodate an event
Deciding factors for 1-min walk from Shinbashi Station Deciding factors for Conveniently located for users tenant Space extendable to more than one floor tenant Its 3m-high ceiling offers an open environment 2. Internal Growth, External Growth, Financial Strategies and ESG Internal Growth ～Dynamic Internal Growth Continuously Achieved～ 10
In each period internal growth achieved in retail & office properties due to tenant replacements with rent increase and upward rent revisions Expected to realize an increase in revenue in the 16th Period far exceeding the 12th Period due to tenant replacement with rent increase and upward rent revisions absorbing decrease in rent revenue recorded due to the depart of a tenant from A-PLACE Shinbashi Ekimae
＜Increase in 2 years (16th vs. 12th Period)＞ ＋¥129mn (+1.1%) Trends in Rent & Common service fee (per period)* (+¥359mn (+3.2％) excl. A-PLACE Shinbashi Ekimae）
Actual Forecast
(in millions of yen)
Retail Retail +11 Office +15 Retail +63 +20
Office ＜vs. 12th＞ +90 Office Office +48 A-PLACE ＜vs 12th Period＞ Retail Shinbashi ・Office +237 11,395AP Shinbashi A-PLACE Ekimae ・Retail +122 Shinbashi 11,344 -207 ・A-PLACE Shinbashi Ekimae Retail Ekimae -230 -23 +76 11,317 11,266 11,249 Office ～ ～ +36 ～ ～ ～ 第2017.1112期 第2018.513期 第2018.1114期 第2019.515期 16th第2019.11 16Period期 (12th Period) (13th Period) (14th Period) (15th Period) (16th Period) （実） （実） （実） （予）※ (2019.11)（予）※ *1 Excluded the properties acquired and property to be disposed in the 12th Period and onwards and sales-linked rent at hotels (Tokyu Plaza Akasaka, Kobe Kyu Kyoryuchi 25Bankan and A-FLAG SAPPORO) *2 Based on the forecasts disclosed on November 30, 2018 and January 17, 2019 2. Internal Growth, External Growth, Financial Strategies and ESG External Growth ~Highlights of the 6th PO~ 11
Conducted the 6th Global PO in Dec. 2018 and acquired 3 new properties (total ¥70.5bn) including 2 retail properties (¥50.7bn) and 1 office building (¥19.8bn) Through meetings through the longest roadshow ever of 7 business days, the issue received a demand of ¥239.4bn, approx.8.2x of the offer size 1. Acquired properties Acquisition Appraisal Acquired Date of Appraisal Property name Address price Value from Acquisition NOI yield (¥ mn) (¥ mn) Tokyu Plaza Ginza (Land) Chuo, 37,500 39,000 2.5％ (30% Co-ownership interest) Tokyo Retail Q plaza HARAJUKU Shibuya, Sponsor Jan. 10, 13,200 13,300 3.1% (60% Co-ownership interest) Tokyo sourced 2019 Osaka, Office EDGE Shinsaibashi 19,800 20,000 4.0% Osaka
Total / Average 70,500 72,300 3.1％ 2. Offering summary
72,520 units Key points Number of investment - Public:67,320 units (incl. units allocated to Acquired from Sponsor 3 competitive and scarce large-sized properties and achieved to further units issued ① designated purchaser 7,252) enhance portfolio quality - Third-party allotment:5,200 ② With asset replacement conducted at the same time as PO, achieved to increase stabilized DPU Ratio of Dom. / Int. 65 / 35 and record gain on sales in the 15th and 16th Periods Total number of units ③ Growth achieved as well in NAV per unit through accretive PO 771,224 units after offering Offering schedule Offer price ¥445,410 per unit Sun Mon Tue Wed Thu Fri Sat Issue price ¥431,320 per unit Nov 25 Nov 26 Nov 27 Nov 28 Nov 29 Nov 30 Dec 1 Total amount offered ¥31,279,326,400 (incl. TPA) Annouce ment Issuance annoucement November 30, 2018 (Fri) Dec 2 Dec 3 Dec 4 Dec 5 Dec 6 Dec 7 Dec 8 date Roadshow Pricing date December 12, 2018 (Wed) Dec 9 Dec 10 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Payment date December 19, 2018 (wed) Roadshow Pricing Delivery date December 20, 2018 (Thu) 2. Internal Growth, External Growth, Financial Strategies and ESG External Growth ～Purpose of the PO～ 12
Through investments based on rigorous consideration of location and quality, ”External Growth contributing to Internal Growth” successively achieved (External & Internal Growth generating virtuous cycle) Succeeded to further enhance portfolio quality as well as secured internal growth potential 1. Three scarce properties acquired from Sponsor 2. PO contributed to “stability” & ”portfolio quality” Acquisition of properties expecting future upside backed by Acquisition price-based AUM grew to ¥502bn (+¥70.5bn vs. before those locations in prime areas such as Ginza, Harajuku and PO), leading further stable earning foundation with enhanced AUM Shinsaibashi where potential rent increase continues to grow Tokyu Plaza Ginza EDGE Distributions (forecast) Q plaza HARAJUKU (Land) Shinsaibashi DPU ¥9,549 ¥9,502 ¥9,502 Flagship property Greater Shibuya area Prime location Characteristics Excellent stability Stability & Upside Upside Distribu tions 7,328 7,365 Official land price (¥mn) 6,638 (Average +17％ +13％ +19％ growth rate) Stability up Stability up
Rent in area before PO after PO after PO (Average growth +13％ +39％ +1％ May 2019 May 2019 Nov. 2019 rate) (15th Period) (15th Period) (16th Period) NAV per unit ①Jingumae 6- *Excluding gain on sale of A-FLAG AKASAKA ①MUJI HOTEL ①Daimaru Major chome Project before PO GINZA Shinsaibashi after PO redevelopment ②Miyashita Park (end of 14th ②Ginza Sony Park (Main Building) (Jan.17, 2019) projects in area Redevelopment Period) project ②Osaka M Project Project ¥437,302/unit ¥439,074/unit (Note 1) Official land prices of 5-41, Chuo Ginza, 5-31 Shibuya and 5-18 Osaka Chuo 3 most significant properties (Note 2) Annual average growth rates from 2015 to 2018 except land price in Ginza and rent in Shinsaibashi both from 2017 to 2018 (based on Portfolio quality acquisition price) API’s strategy for enhancement external and internal growth cycle + Portfolio Increase unitholder value diversification
Higher Tokyu Plaza Tokyu Plaza Shiodome Kobe Kyu evaluation Omotesando Ginza DPU & NAV Building Kyoryuchi Total Harajuku (Land) growth in equity (30%) 25Bankan market (75%) (30%) Investment ratio 14.3% 9.0% 7.5% - 30.7％ (after PO) Internal growth External growth (before PO） 16.6% 10.4% - 4.9% 32.0％ Enhance AUM Stabilize revenue Aim to increase continuously unitholder value through steady growth in DPU and NAV per unit 2. Internal Growth, External Growth, Financial Strategies and ESG External Growth ～Continual Expansion of AUM for the Growth in Unitholder’s Value～ 13
Continued since IPO to expand portfolio rigorously selected with a focus on location and quality, maintaining focused investment ratio at around 80% We aim at further continuous expansion of our portfolio contributing to unitholder’s value 1. Trends in AUM and investment ratio 2. Acquisition route and method Investment ratio (as of Jan. 17, 2019) Since IPO, achieved external growth utilizing source both from Sponsor Group and Asset Manager ¥502.0bn
39.2% 40.2% Sponsor Ratio of Via Asset Group focused Manager (developed) 48.7% ¥431.5bn investment ¥103.2bn ¥137.3bn 51.3% assets （31%） ¥389.1bn % 79.4 Third Party ¥71.1bn 20.6% Acquired ¥326.7bn ¥333.9bn Inner circle： Office Retail ¥282.6bn (after the External circle : TO AA UR 6th PO)
¥231.7bn Warehousing ¥32.2bn Sponsor ¥170.4bn sourced Sponsor ¥230.7bn Group （69%） (owned) ¥93.5bn
3. Acquisition capacity 18 26 30 32 38 42 45 Capacity sufficiently secured after the PO properties properties properties properties properties properties properties for flexible asset acquisition 2012Jun. 2012年6月 2013Jan. 年201411月 2014Jan.年 201511月 2015Jan.年 201611月 2016Jan.年 201711月 2017Jan.年 201811月 2018Jan.年年 20191111月月 after 6th PO afterIPO IPO後 after1stPO 1st後 PO after2ndPO 2nd後 PO after3rdPO 3rd後 PO after4thPO 4th後 PO after5thPO 5th後 PO 6thPO本PO後
Retail 71.5% 70.3% 59.3% 54.9% 49.0% 49.7% 48.7% approx. ¥44.5bn
Office 28.5% 29.7% 40.7% 45.1% 51.0% 50.3% 51.3% *at LTV 50% Focused investment 79.7% 80.3% 80.1% 83.2% 80.0% 80.6% 79.4% ratio 2. Internal Growth, External Growth, Financial Strategies and ESG External Growth ～Properties Held by Sponsor Group and Diversified External Growth Methods (Example and Policy of Asset 14 Replacement)～ 3. Asset replacement of A-FLAG AKASAKA 1. Significant properties held by Sponsor Group *As of Sep. 30 and Q plaza HARAJUKU Office Replacement summary Walking Complet GFA Nb Property Nearest station （thousands Asset replacement with the aim of enhancement of portfolio quality and distance -ion ㎡） Ichibancho Tokyu ① Hanzomon 1 min 2002 20 DPU management Building ② Ebisu Business Tower Ebisu 2 min 2003 23 Asset to be disposed： Property acquired： ③ Shibuya Square Shibuya 3 min 2004 13 A-FLAG AKASAKA Q plaza HARAJUKU ④ Hamatsucho Square Hamamatsucho 1 min 2004 24 Shibuya Minami Tokyu ⑤ Shibuya 6 min 2005 20 Building small-sized asset 2-min. walk from Uchisaiwaicho Tokyu ⑥ Shinbashi 2 min 2006 14 with GFA of less nearest station in Building Nihonbashi Maruzen than 3,000㎡ Great Shibuya ⑦ Nihonbashi 1 min 2006 17 Tokyu Building area Minamiaoyama Tokyu ⑧ Omotesando 4 min 2008 12 rent upside Building Developed and Shinbashi Tokyu achieved ⑨ Shinbashi 2 min 2008 15 held by Sponsor Building To be Kasumigaseki Tokyu ⑩ Tameike-Sanno 4 min 2010 19 replaced Building aged 10.8yrs aged 3.7yrs Shin-Meguro Tokyu (as of Nov. 30, 2018) (as of Nov. 30, 2018） ⑪ Meguro 2 min 2012 22 Building Shin-Aoyama Tokyu ⑫ Omotesando 3 min 2015 9 Building ＜Tenant structure＞ ＜Tenant＜テナント構成＞ structure＞ Retail Fashion Retail 10% Wedding Yoga Restaurant 18% 44% studio Walking Complet GFA 65% Nb Property Nearest station (thousands 10% distance -ion ㎡） Service Directly 8 テナント数15 - Tokyu Plaza Kamata Kamata 1968 28 13% connected Service tenants tenants14 ① Shibuya BEAM Shibuya 5 min 1992 7 16% Food Daini Musashino Shinjuku San- ② 1 min 1992 6 service Building chome （based on leased area） 25% - Northport Mall Center Kita 1 min 2007 141 (based on leased area) Directly - Tokyu Plaza Totsuka Totsuka 2010 12 connected Futakotamagawa Comparison of - Futakotamagawa 1 min 2011 20 rise-SC Disposition schedule Morinomiya Q’s MALL appraisal values 2. Properties co-owned with - Morinomiya 1 min 2015 24 BASE （¥mn) Gain on sale will be recorded in the 15th & Q plaza CR - Futakotamagawa 1 min 2017 3 4,500 16th Periods Sponsor Group FUTAKOTAMAGAWA 3.5% 4,000 CR 3,750 Period ended Period ending Period ending 4.3% Nov. 2018 May 2019 Nov. 2019 3,500 75 3,150 （14th Period） （15th Period） （16th Period） % 3,000 Nov. 30, 2018 Mar. 1, 2019 Jun. 3, 2019 30 60 Tokyu Plaza % % Dispose 50% Dispose 50% Omotesando Harajuku 2,5000 as of Jul. 2013 at the end of Announcement of co-ownership co-ownership (at acquisition) 14th Period sale to Sponsor interest interest (latest) Group (Contribution to DPU (Contribution to DPU 50 of disposition: ¥376) of disposition: ¥356) % 4. Policy of asset replacement Tokyu Plaza Akasaka Enhance portfolio quality through asset replacement and 49 aim at further growth of API % Select asset to be disposed by comprehensive evaluation of each Tokyu Plaza Ginza Q plaza HARAJUKU DECKS Tokyo Beach asset’s competitiveness and other elements (Land) Be flexible with regard to replacement timing *co-ownership interest ratios held by API 2. Internal Growth, External Growth, Financial Strategies and ESG Financial Strategies ～Status of Financing 1～ 15
1. Trends in LTV and borrowing indicators Secured acquisition capacity of approx. ¥44.5bn with a LTV at maximum 50% through the 6th PO and prepared for further acquisition LTV Acquisition取得余力 Capacity（LTV50% (at max.迄） 50%) LTV Appraisal as of Jan. 17, 2019 as of Jan. 17, 2019 鑑定LTV LTV 50.0% 45.7％ approx. ¥44.5bn 47.7% 45.9% 46.0% 46.0% 45.7% 45.0% 44.7% 44.8% st 44.5% 1 PO th 43.7% 43.3% 4 PO 42.8% 42.7% th th 41.5% 5 PO 6 PO 3rd PO 43.4% 43.6% 2nd PO 40.0% 41.3% 41.6% 40.1% 40.1% 39.6% 39.2% 39.0% 39.5% 38.7% 38.0% 38.3% 37.7%
2012.11 2013.5 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11 as2019 of Jan.年 (第(2nd2期) (第(3rd3期) (第(4th4期) (第(5th5期) (第(6th6期) (第(7th7期) (第8(8th期) (第(9th9期) (第(10th10期) (第(11th11期) (第12(12th期) (第(13th13(13th期) (第(14th14期) 1月17,17 2019日時点 Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) period)period)Period) Period) ２. Average years remaining to maturity and interest rate Secured average remaining years to maturity of over 4 years and a ratio of fixed interest rate of over 80% as of Jan. 17, 2019 with lowering average interest rate Ave. interest rate Ave. remaining years to maturity Ave. years remaining Ave. interest 0.58% 4.4 years 平均残存年数to Maturity 平均金利rate
0.80% 0.79% 0.77% 0.75% 0.76% 0.75% 0.75% 0.77% 0.67% 0.67% 0.65% 0.66% 0.63% 0.58% 4.6yrs 4.1yrs 4.4yrs 4.4yrs 4.5yrs 4.4yrs
3.3yrs 3.5yrs 3.3yrs 3.5yrs 2.9yrs 3.1yrs 2.9yrs 3.0yrs
2nd2012.11 Period 3rd2013.5 Period 4th2013.11 Period 5th2014.52014.5 Period 6th2014.11 Period 7th2015.52015.5 Period 8th2015.112015.11 Period 9th2016.52016.5 Period 10th2016.11 Period 11th2017.5 Period 12th2017.112017.11 Period 13th2018.52018.5 Period 14th2018.112018.11 Period asas 2019of of Jan. Jan年 19,17, (2nd Period) (3rd Period) (4th Period) (5th Period) (6th Period) (7th Period) (8th Period) (9th Period) (10th Period) (11th Period) (12th Period) (13th Period) (14th Period) （2012.11)(第2期) （(2013.5)第3期) （(2013.11)第4期) （(2014.5第5期) ） （2014.11(第6期) ） （2015.5(第7期)） （2015.11(第8期) ） （(2016.5)第9期) （2016.11(第10期)） ((2017.5)第11期) (2017.11)(第12期) ((2018.5)第13期) (2018.11)(第14期) 1月1720192019日時点 Interest bearing debt 77,000 85,000 88,000 100,800 110,800 127,100 136,900 147,150 177,150 196,150 196,150 199,350 199,350 234,350 (¥mn) Ratio of fixed- 70.1% 74.1% 71.6% 79.2% 77.4% 85.1% 82.6% 88.6% 86.5% 92.8% 92.8% 95.4% 95.4% 86.8% rate 2. Internal Growth, External Growth, Financial Strategies and ESG Financial Strategies ～Status of Financing 2～ 16
１. Strategic refinancing and new borrowings ２. List of lenders (as of Jan. 17, 2019) from the 14th Period onwards Lenders presently extended to 18, and further enhance lenders diversification Implemented strategic refinancing and new borrowings with leveraging investment corporation bonds Outstanding allowing to lengthen average borrowing period and lowering Ratio average interest rate amount (\mn) 8% Mitsui Sumitomo Trust Bank 45,305 19.3% MUFG Bank * 65,260 27.8% 19% Mizuho Bank 45,305 19.3% Mitsui Sumitomo Banking Before After New 19,140 8.2% Corporation refinancing refinancing borrowings Development Bank of Japan 19,140 8.2% 8% Mizuho Trust & Banking 7,140 3.0% Total Resona Bank 3,440 1.5% repaid/borrowed ¥23.6bn ¥23.6bn ¥35.0bn The Bank of Fukuoka 2,440 1.0% amount 8% Shinkin Central Bank 2,940 1.3% 28% The Norinchukin Bank 2,640 1.1% Ave. borrowing The Gunma Bank 500 0.2% 3.8yrs period 4.2yrs 4.1yrs Nippon Life Insurance Company 500 0.2% 19% Tokyo Marine & Nichido Fire 400 0.2% Insurance The 77 Bank 400 0.2% Mitsui Sumitomo Trust Bank MUFG Bank Mizuho Bank Ave. interest rate 0.67% 0.43% 0.31% Mitsui Sumitomo Insurance Mitsui Sumitomo Banking Corporation Development Bank of Japan Mizuho Trust & Banking 500 0.2% Company Resona Bank The Bank of Fukuoka Shinkin Central Bank Taiyo Life Insurance Company 500 0.2% The Norinchukin Bank The Gunma Bank Nippon Life Insurance Company THE NISHI-NIPPON CITY BANK 500 0.2% Tokyo Marine & Nichido Fire Insurance The 77 Bank Mitsui Sumitomo Insurance Company The Bank of Kyoto 300 0.1% Taiyo Life Insurance Company THE NISHI-NIPPON CITY BANK The Bank of Kyoto
３. Maturity Ladder Investment Corporation Bonds Investment Corporation Bonds 18,000 7.7% Total 234,350 100.0% Diversified maturity periods paying attention to refinance of * Borrowings from MUFG Bank include borrowings of ¥25.51bn from investment corporation bonds former Mitsubishi UFJ Trust and Banking Corporation. Interest-bearing debt maturity ladder (as of Jan 17, 2019) ４. Issuer rating Long-term issuer rating 20020（¥bn） Investment 既存借入Borrowings 投資法人債 新規借入New borrowings Corporation Commitment line Credit line AA（Stable） Bonds + ¥21bn ¥12bn 〈Japan Credit Rating Agency 16 160 5.0 (JCR)〉 5.0 2.0 12012 1.0 2.0 1.0 4.0 6.0 18.1 808 2012 2015 2016 14.5 13.8 13.3 14.0 （at IPO） AA- AA 12.5 12.0 12.5 12.0 12.0 10.5 10.9 11.3 AA- （Positive） （Stable） 9.1 8.6 （Stable） 404 8.1 7.3 6.0
0 1.0 1.0 第15th15期 第16th16期 第17th17期 第18th18期 第 19th19期 第 20th20期 第 21st21期 第22nd22期 第 23rd23期 第 24th24期 第25th25期 第26th26期 第27th27期 第28th28期 第 29th29期 第 30th30期 第 31st31期 第 32nd32期 第 33rd33期 第 34 期 第 41th41期 第 42 期 第 53th53期 2. Internal Growth, External Growth, Financial Strategies and ESG ESG ～Preparation for Issuance of API’s Green Bonds～ 17
Began preparation for issuance of API’s first Green Bonds Second-party opinion obtained from Sustainalytics (Subsidy to be granted from the Ministry of the Environment) １. Purpose of the issuance ３. Eligible Green Project As first J-REIT, API limited the green building certification of 1 Offer ESG investment opportunities the eligibility criteria to the top two levels Expect to contribute to expand Green Bond market in J-REIT by offering ESG investment opportunities which is drawing attention recently Strict green eligibility with a scope smaller than ２ Promote ESG initiatives the green certified buildings Issuance of Green Bond for further promote API’s sustainability initiatives toward sustainability and green certifications aiming Green to build a portfolio of properties that can expect stable and Eligible Projects Green Eligible Projects sustainable customer demand ¥287.2¥bn261.5(67%)n Strengthen financial formation ¥ bn 3 261.5 ■Green buildings awarded 5 stars (¥135.7bn) Intend to draw new investor segment including major investors to ■Green buildings awarded 4 stars invest corporation bonds market of which players are limited (¥125.7bn) Pursue API’s sustainable asset management through issuance of ■Green buildings awarded 3 or less stars Green Bonds allowing more stable fund raising ■Not applicable (excl. land) ■Not applicable (land) ２. Use of Proceeds （Note）Based on book value at the end of the 14th Period (total 42 properties） The proceeds will be limited to allocation to acquisition of new eligible
Environment Social Governance 1. External assessment of measures for sustainability 3. Asset management fee structure pursuing unitholder value 24 properties, over half of portfolio are awarded external certification At IPO in Jun. 2012, API adopted an asset management fee linked to GRESB Real Estate Assessment DPU for a portion of the management fees paid to the Asset Manager (Type II), which has led to incentivize the Asset Manager to maximize Awarded for two consecutive years “Sector Leader” in “Diversified – Office & Retail/Asia” in the assessment 2018 unitholder’s value Obtained the highest grade of “5 Stars” in the GRESB Rating Asset management fees Acquisition / disposition fees TypeⅠ Ratio of acquisition Ratio of disposition Recognized with Green Star for five consecutive years Type II since 2014 (participation from 2013) (annual rate) fee fee Excl. Excl. Acquired highest rating “A” GRESB Public Disclosure DPU before Related Related deduction of related related Total assets at party party party party Type II Certification for CASBEE for Real Estate the end of the No management Newly 4 properties certified in Oct. 2018 previous 0.5% disposition fee period fees Basis for × 0.7% 0.5% × No disposition fees calculation NOI At present, 16 properties have been of fee rate 0.3% when loss on sale is awarded certification, and all acquired top × accrued class evaluation out of 5 classes 0.0002% S(5 stars): 7 properties The sum of Type I and Type No disposition fees (A-PLACE Ebisu Minami, etc.) II may not exceed 0.5% of A(4 stars): 9 properties A-PLACE TLC Ebisu A-PLACE A-PLACE Shinagawa Building Ebisu Higashi Shibuya is accrued for the sale of (Q plaza HARAJUKU, etc.） our total assets at the end of Higashi Konnoh each period A-FLAG AKASAKA BELS DBJ Green Building Certification 4. Same-boat investment by Sponsor 6 properties have been awarded First same-boat investment by Sponsor in the 6th PO 3 stars to 1 star 8 properties have been awarded 5 to 3 stars 3 stars:2 properties 5 stars:2 properties (OSAKI WIZTOWER, etc.) after the last participation three years ago Market Cap (A-PLACE Shibuya Konnoh, etc.) 4 stars:2 properties (Tokyu Plaza Omotesando, approx. ¥30bn 2 stars:3 properties (A-PLACE Yoyogi, etc.) etc.) Trend in Units hold by Sponsor （calculated based on closing 1 star: 1 property (A-PLACE Shinagawa) 3 stars: 4 properties (Tokyu Plaza Akasaka, etc.) price on Jan. 2019) (unit) 10.5% 10.4% 10.4% 10.3% 9.3% 2. Social contribution 100,000 8.9% 9.0% 10%
80,000 69,165 8% 61,913 61,913 61,913 57,374 60,000 52,160 6% 43,000 40,000 4%
20,000 2% Local nursery school children tried out vegetable Active participation at Umeda Gate Tower in farming at the Omohara Forest rooftop terrace various events sponsored by local 0 0% of Tokyu Plaza Omotesando Harajuku organizations 2012年6月 2013年11月 2014年11月 2015年11月 2016年11月 2017年11月 2018年11月 Since Jun. 2018, we are implementing Harvest Joined “Purari Flower Watching” led by Jun. 2012 Jan. 2014 Jan. 2015 Jan. 2016 Jan. 2017 Jan. 2018 Jan. 2019 Festival from time to time, promoting to Umeda Higashi Town Promote Association in afterIPO IPO後 after1stPO 1st後 PO after2ndPO 2nd 後PO after3rdPO 3rd後 PO after4thPO 4th後 PO after5thPO 5th後 PO after6thPO 6th後 PO communicate with local communities and build Nov. 2018 and set flowers of every season good relationships with the surrounding areas through various projects 3. Financial Forecast (Reference) Financial Forecasts for the Period Ending May 2019 (the 15th Period) 19
Both revenue and profit are expected to largely increase from the 14th Period due to (i) new operation of the 3 properties acquired through the 6th PO and (ii) gain on sale to record, absorbing decrease in sales-linked rent at hotels DPU is expected to be ¥9,878, up ¥294 from the previous period
1. 15th Period latest forecasts vs. 14th Period results/ 2. Variance analysis (vs. 14th Period results) 15th Period former forecasts (in millions of yen) (in millions of yen) 15th Period vs 14th 14th 15th Period (vs. former Period Details Period (Period ending May 2019) forecasts) results Forecasts vs Previous Change New operation +982, Sale of A-FLAG AKASAKA +309, Forecast Increase Rent of existing properties +54, Cancellation penalty Results 2018.11.30 Period (vs. former 2018.7.13 Operating +6, Parking lots fee +4 2019.1.17 forecasts) +956 Difference (%) revenue Sales-linked rent at hotels -203, Utility fee income Operating 13,815 14,771 ＋956 +6.9% 13,431 +1,339 Decrease -144, Other income -31, Facility usage fee -18, revenue Restoration work fee -2 New operation +116, Depreciation +14, Gain on sale 0 338 +338 - 0 +338 Increase Expenses Advertisement fee +11, Taxes & Public dues +9 Operating 6,268 6,189 -79 -1.3% 5,922 +266 related to rent -155 Repair & Maintenance -150, Management operation expenses business Decrease expenses -68, Utilities fee -58, Other rent business Taxes & expenses -17, Sale of A-FLAG AKASAKA -13 988 997 +9 +0.9% 997 +0 Public dues NOI after depreciation +772 Operating profit 7,546 8,582 +1,035 +13.7% 7,509 +1,073 (excl. gain on sale) Asset management fee +40, Taxes & Public dues +13.8% +979 General Ordinary profit 6,697 7,619 +921 6,640 Increase +17, Miscellaneous expenses +10, Administration administrative +75 service +3, Custody fee +1, Payment commission +1 Profit 6,696 7,618 +921 +13.8% 6,639 +979 expenses Decrease DPU ¥9,584 ¥9,878 +¥294 +3.1% ¥9,502 +¥376 Operating 調達コスト：0.825% +1,035 profit 3. Variance between the 15th Period forecasts and Interest rate assumption：0.80% the 14th Period results (DPU) vs. 14th Period +¥294 ¥9,878 Sale of ¥9,584 A-FLAG AKASAKA Operating Expenses General Interest PO, etc. revenue related to administrative expenses and rent expenses others business ～ +¥1,240 +¥201 -¥98 -¥172 -¥877 ～ the 14th Period results the 15th Period forecasts (ended May 2018) (ending May 2019) (Note) The forecasts are calculated based on certain assumptions that reflect present conditions, and are subject to change. The forecasts do not guarantee any amount of distributions. 3. Financial Forecast (Reference) Financial Forecasts for the Period Ending Nov. 2019 (the 16th Period) 20 Both revenue and profit forecasted to increase from the 15th Period due to (i) full-period operation of 3 properties and (ii) revenue increase from rent of existing properties DPU is expected to be ¥9,905, up +¥27 from the previous period 1. Comparison to the 15th forecasts (in millions of yen) 2. Variance analysis (vs. the 15th latest forecast) (in millions of yen) 15th Period 16th Period (ending Nov. 2019) vs. 15th Details Forecasts Forecasts vs. 15th Period forecasts 2018.11.30 2018.11.30 Full-period operation +320, Utility fee income +159, 2019.1.17 2019.1.17 Difference (%) Sales-linked rent at hotels +125, Rent of existing Operating Operating Increase 14,771 15,383 +612 +4.1% +612 properties +85, Facility usage fee +13, revenue revenue Parking lot fees +2, Restoration works +1 Gain on sale 338 341 +3 +0.1% Decrease Sale of A-FLAG AKASAKA -75, Cancellation penalty -16 Full-period operation +66, Utility expense +138, Operating 6,189 6,711 +522 +8.4% Repair & maintenance +103, Taxes & public dues +93, expenses Expenses Increase Other expenses related to rent business +31, Taxes & related to +396 997 1,087 +90 +9.0% rent business Depreciation +10 public dues Sale of A-FLAG AKASAKA -25, Management operation Decrease Operating profit 8,582 8,672 +89 +1.0% expenses -12, Advertisement fee -7 NOI after Ordinary profit 7,619 7,640 +20 +0.3% depreciation +212 (exclu. gain on sale) Asset management fee +120, Payment commission +6, Profit 7,618 7,639 +20 +0.3% General Increase administrative +125 Administration service +2 DPU ¥9,878 ¥9,905 +¥27 +0.3% expenses Decrease Miscellaneous expenses -3 Operating +89 3. Variance between the 16th Period forecasts and profit the 15th Period forecasts (DPU) Interest rate assumption：0.85% vs. previous period +¥27 ¥9,878 ¥9,905
Operating Expenses General Interest Expenses revenue related to administrative expenses and related to PO rent expenses others business ～ +¥794 -¥514 -¥163 -¥124 +¥35 ～ the 15th Period forecast the 16th Period forecast (ending May 2019) (ending Nov. 2019)
(Note) The forecasts are calculated based on certain assumptions that reflect present conditions, and are subject to change. The forecasts do not guarantee any amount of distributions. 3. Financial Forecast Trend in Distributions per Unit 21
Actual DPU for the 14th Period reached ¥9,584 exceeding the initial forecast, mainly due to that (i) the internal growth achieved in the 13th Period and before has stabilized and (ii) sales-linked rent at hotel increased. Forecast ¥9,878 for the 15th Period and ¥9,905 for the 16th Period (50% co-ownership interest of A-FLAG AKASAKA is scheduled to dispose in the 15th Period and the remaining 50% in the 16th Period) ¥10,000 (¥) level on stabilized base Initial前回予想分配金 forecast 分配金確定値Actual DPU 10,000 9,905 Actual今回確定・予想分配金 / Forecast 「EffectA-FLAG by赤坂」売却効果相当額 disposition 9,878 as of Jan. 17, 2019 (A-FLAG AKASAKA) 356 ¥9,584 376
9,502 9,549
9,000
9,500 9,502 9,462 9,346 9,248 8,000 9,021
8,642 8,666
8,267 7,961 8,028 7,761
7,000 2013.11 2014.5 2014.11 2015.11 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11 2019.5 2019.11 (4th (5th (6th (7th (8th (9th (10th (11th (12th (13th (14th (15th (16th Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) (Note) Adjusted for the 2-for-1 unit split effected as of October 1, 2015. Thus, the figures before the 8th period are shown as half as the actual DPU. 4. Other Trend in Appraisal Value / NAV per Unit 22
１.Trend in appraisal value
19.0% ((百万円¥mn)) 合計 ポートフォリオ含み益（百万円）Unrealized gain in portfolio 期末帳簿価額（百万円）Book value at the end of 含み益率Ratio of unrealized gain (¥mn) period (¥mn) 16.9% 17.2% 650,000 15.2% 15.6% 14.4% 13.3% 550,000 504,987 511,687 10.9% 471,555 475,890 9.4% 74,088 81,702 450,000 411,705 63,724 68,944 373,715 6.8% 332,355 54,298 350,000 5.4% 314,130 47,171 39,051 3.8% 3.9% 265,130 30,818 247,660 407,830 406,945 430,898 429,984 250,000 22,695 357,406 194,990 15,735 326,543 189,470 283,311 293,303 177,890 7,166 9,972 6,469 231,924 242,434 185,017 150,000 171,420 182,303 2012.112012.11 2013.52013.5 2013.112013.11 2014.52014.5 2014.112014.11 2015.52015.5 2015.11 2016.5 2016.112016.11 2017.52017.5 2017.11 2018.52018.5 2018.112018.11 (2nd(第 2Period)期) （第(3rd 3Period)期） (4th(第 Period)4期) (5th（第 5Period)期） （第(6th 6Period)期） (7th（第 Period)7期） (8th（第 Period)8期） (9th（第 Period)9期） (（第10th10 Period)期） （第(11th11 Period)期） (12th（第 12Period)期） （第(13th13 Period)期） (14th（第14 Period)期） 2.Trend in NAV per unit (¥) Unrealized gain per Net asset per unit (¥) 1口当たり含み益（円） 1口当たり純資産（円） 437,302 450,000 unit (¥) 426,311 409,154 417,110 385,750 400,000 373,383 351,118 106,036 116,934 95,795 103,642 350,000 335,888 90,549 78,663 304,271 290,342 70,456 300,000 55,601 45,199 254,632 31,338 245,307 248,509 313,359 313,467 320,275 320,368 250,000 294,719 295,200 15,759 17,458 24,292 280,287 280,661 259,004 259,071 229,547 231,051 230,340 200,000 2012.112012.11 2013.52013.5 2013.11 2014.52014.5 2014.112014.11 2015.52015.5 2015.11 2016.52016.5 2016.11 2017.52017.5 2017.11 2018.52018.5 2018.112018.11 (2nd Period) (3rd Period) (4th Period) (5th Period) (6th Period) (7th Period) (8th Period) (9th Period) (10th Period) (11th Period) (12th Period) (13th Period) (第2期) （第3期） (第4期) （第5期） （第6期） （第7期） （第8期） （第9期） （第10期） （第11期） （第12期） （第13期） (14th（第14 Period)期） (Note) To reflect the 2-for-1 split of investment units as of October 1, 2015 as the effective date, the figures of NAV per unit before the 8th period are shown as half of actual value. 4. Other Distribution of Unitholders and IR Activities 23
1. Distribution of Unitholders by # of Unitholders and # of Units 2. Top 10 Unitholders
End of Nov. 2018 (the 14th Period) End of May 2018 (the 13th Period) Investment Ratio # of # of Name # of # of units (%) unit- Ratio Ratio unit- Ratio Ratio units units holders holders Individual, Japan Trustee Services Bank, Ltd. 6,304 91.2% 26,101 3.7% 6,559 91.6% 26,170 3.8% 1. 129,161 18.5 other (Trust accounts)
Financial 189 2.7% 417,331 59.7% 183 2.6% 428,770 61.4% The Master Trust Bank of Japan, Ltd. institution 2. 111,255 15.9 (Trust accounts) Other domestic 149 2.2% 68,936 9.9% 147 2.1% 69,118 9.9% company 3. Tokyu Land Corporation 61,913 8.9 Foreign institution, 252 3.6% 172,330 24.7% 255 3.6% 164,309 23.5% other The Nomura Trust and Banking Co,. Ltd 4. 28,691 4.1 Securities (Investment accounts) 16 0.2% 14,006 2.0％ 18 0.3% 10,337 1.5％ company Trust & Custody Services Bank, Ltd. Total 6,910 100％ 698,704 100% 7,162 100％ 698,704 100% 5. (Securities investment trust accounts) 22,646 3.2 Foreign Securities Individual, other Other domestic institution, other company 26,101 company 14,006 （3.7%） 252 (3.6%) （2.0%） 6. SSBTC CLIENT OMNIBUS ACCOUNT 12,711 1.8 149 (2.2%） Foreign institution, Securities other Financial company By 172,330 By Mitsubishi UFJ Morgan Stanley Securities Co., institution 16 (0.2%) Investment 7. 11,100 1.6 Unitholder （24.7%） Ltd. 189 (2.7%) unit 6,910 698,704 Other domestic Financial Individual, other company institution 8. THE BANK OF NEW YORK 133970 10,246 1.5 6,304 (91.2%) 68,936 417,331 （9.9%） （59.7%） 3. IR activities Seminars for individual investors 9. State Street Bank West Client Treaty 505234 8,160 1.2 Visited Asia, North America and Europe in scheduled in 2019 and onwards ■Caravan and others addition to internal Japan for communication of Feb. 8 Seminar by ARES in Yamaguchi 10. State Street Bank & Trust Company 505012 7,693 1.2 results of the period ended May 2018, as first IR Feb. 13 Caravan in Tokyo by Daiwa activities of new management team, and API Apr. 25 Daiwa J-REIT Caravan in intends to continue constructive IR activities Fukuoka Total 403,576 57.8 Total Domestic Oversea Individual ■Seminar in security company’s branch Feb. 18 Mizuho Machida branch 151 95 52 4 Mar. 13 Nikko Okayama branch meetings or meetings or meetings or seminars conference calls Mar. 27 Daiwa Shibuya branch …etc. conference calls conference calls (346 pers.) or seminars 5. Acquisition Highlights External Growth ~Properties Acquired in the 15th Period (Tokyu Plaza Ginza (Land))~ 24 Unconventional tenant composition balancing tradition UR-16 Tokyu Plaza Ginza (Land) (30% co-ownership interest) and innovation First-in-Japan: 11 stores New style shop: 38 stores Flagship RF KIRIKO TERRACE
11F THE APOLLO LOTTE Duty Free Shop Prime location Restaurant Sponsor developed 10F
9F Duty free shop 8F KIRIKO LOUNGE 7F Fashion, cafes, clothing, lifestyle goods 6F Tokyu Hands Modern Greek restaurant Largest airport-style duty free from Sydney shop in Tokyo 5F Fashion, cafes, Tokyu BALLY TWG Tea 4F clothing, Department lifestyle goods Store 3F
2F Flagship stores 1F
B1F MARCHE Flagship store of major Swiss B2F An international Directly connected to Ginza Station (Tokyo Metro) luxury jewelry brand high grade tea brand Sponsor Group’s tenants creating and transmitting new culture (New-style shop by Tokyu Hands) (New-style shop by Tokyu Department store) “Brand-New Select “Into, Hands” Store in Ginza” Creative interior suitable for Ginza, a center for new culture Five cultural zones (wa Offers ‘new adult fashion’ (和), miyako (都), chi (知), with a lineup of the finest Creative space that stays fresh for visitors, with an interior complementing the cut glass exterior and bi (美), and syoku (食)) items selected both inside designed in consideration of inbound tourists built on the concept of and outside Japan by the ‘linking cultures, most discerning buyers generating culture’ Tokyu Land Corporation’s Holding scheme with an eye ‘Tokyu Plaza’ commercial to long-term growth property brand KIRIKO TERRACE KIRIKO TERRACE KIRIKO LOUNGE Sukiyabashisabo B2F entrance plaza WATER SIDE GREEN SIDE Acquisition scheme in partnership Location Ginza, Chuo, Tokyo with the Sponsor Group Commercial facilities serving as city landmarks, 1 Ginza: A global prime area 1 minute walk from Ginza Station on Will acquire land (30% co-ownership interest) adding high quality to the day-to-day Access the Tokyo Metro Marunouchi Line and obtain the priority negotiation right for and others (directly connected) Leading, highly competitive commercial area the building and remaining co-ownership of with numerous global brands Acquisition price ¥37,500mn the land Seeking property growth through co- Appraisal value ¥39,000mn Tokyu Plaza Omotesando Tokyu Plaza Akasaka 2 Rare location facing Sukiyabashi ownership with the Sponsor Group Harajuku vs. appraisal Intersection 96.2% value Long-term stable lease Located at the corner of the Sukiyabashi Forecast/Apprais 3.1%/2.5% Intersection, which has an overwhelming al NOI yield Will conclude a 70-year term land lease agreement Tokyu Plaza Ginza Tokyu Plaza Tokyu Plaza Tokyu Plaza amount of foot traffic even for the Ginza area Shinnagata Occupancy rate 100% (as of Jan. 10, 2019) Kamata Totsuka To address the risk of increased costs by (Note) We have no plans at present to acquire the remaining co-ownership trust beneficiary linking rent to property taxes and other taxes interests in Tokyu Plaza Omotesando Harajuku, Tokyu Plaza Akasaka and Tokyu Plaza Ginza, and trust beneficiary interests in Tokyu Plaza Kamata, Tokyu Plaza Totsuka, and Tokyu Plaza Shinnagata 5. Acquisition Highlights External Growth ~Properties Acquired in the 15th Period (Q plaza HARAJUKU)~ 25
UR-17 Q plaza HARAJUKU (60% co-ownership interest) Area connecting Shibuya and Harajuku Heavy traffic between Harajuku Meiji Street Greater Shibuya Area 1 and Shibuya In addition to traditional retail properties, other 10 minute walk from Shibuya Station, the area is bustling with facilities such as sports brands, showrooms, and Upside potential people going back and forth between Harajuku and Shibuya shared workspaces have been rolling out Sponsor developed Heavy foot traffic between the property and Cat Street, a busy commercial area running along the east side of Meiji Street Meiji Street: Growth potential 10 min. walk 2 from from development Shibuya Station With the opening of WeWork in August 2018,which offers shared offices, the area will continue to receive much attention A construction project is underway at the Miyashita Park Cat Street Intersection, which is to the south of the property, and at Jingumae Intersection, which is to the north of the property Area with diverse values and several unique fashion and design shops 3 Diverse entertainment-related tenants A growing number of retailers as well as Tenants include a new wedding chapel and restaurants, and first-in-Japan sweet shops and other various other eateries eateries The area is a foremost source of trends in Japan and, going forward, is expected to serve as an area for showrooms and promotional spaces Location Jingumae, Shibuya, Tokyo
2-minute walk from Meiji-jingumae Access
Acquisition price ¥13,200mn Major nearby redevelopment projects Appraisal value ¥13,300mn ①Jingumae 6-chome urban area ②Miyashita Park Redevelopment Project vs. appraisal value 99.2% (Jingumae 6-chome Project) Redevelopment Project
Forecast /Appraisal NOI yield Stores, public interest facilities, Retail, hotel, 3.1%/3.1% Usage substation facilities, parking integrated park Occupancy rate 95.2% (as of Nov. 30, 2018) Gross floor area Approx. 22,000 m2 Approx. 47,000 m2 Completion date March 2015 Unique appearance and diverse tenant composition suitable for the area Completion date FY2022(scheduled) March 2020(scheduled)
(Note) We have no plans at present to acquire the above properties Appealing tenants on each floor Tenant mix with stability and popularity
1-3 years Prime area with high property values and various new tenants 11F Fashion Wedding Dining bar 10% 18% 45% Tokyu Land Corporation’s ‘Q plaza’ 10F Fixed Ave. Ratio of numbers of new 1F retail rents in the Harajuku, More than remaining エリア別新規出店割合 9F Restaurant rent Omotesando, Aoyama area 10 years period 3-5 years store openings by area commercial property brand Services Tenants by 100% 44% 29% 8F Restaurant 6.9yrs 13% type (¥/tsubo) 7F Entertainment cafe 5-10 years Jingumae 6-chome, Urban Retail Properties with shops 6F Beauty salon 17% Cafe and restaurant Shibuya ward suitable for unique city areas 5F School 24% (Based on leased area) (where Q plaza HARAJUKU) 眺望を生かした空間 Shinjuku 表参道・ is located) 4F (Vacant as of Nov. 30, 2018) (Based on leased area) 原宿 Jingumae 1-chome, Newsy tenants 18% Shibuya ward 3F Cafe and restaurant Terrace Terrace (Around 神泉駅 Party & Entertainment cafe for fans of music, 2F Popular US hair salon wedding Terrace animation, games, etc. to gather and Omotesando/ La Foret Harajuku) Fashion, flower shop, cafe First shop in Japan Ginza communicate Harajuku Kita Aoyama 3-chome, 1F Wedding EBISU SHINSAIBASHI Wedding salon 17% Minato ward B1F Beauty & health 51% (Around Ao Building) Exterior design with excellent visibility Shibuya Minami Aoyama 5-chome, 14% Minato ward (Around Avex 2015 Good Design Award recipient HARAJUKU FUTAKO IKEBUKURO Building) (Scheduled to TAMAGAWA open in July 2019) Jingumae 4-chome, (Note) We have no plans at present to acquire the remaining co-ownership Shibuya ward trust beneficiary interest in Q plaza HARAJUKU, and trust beneficiary Largest wedding (Around Omote- interests in Q plaza FUTAKOTAMAGAWA and Q Plaza IKEBUKURO chapel in the area sando Hills) View from View from Shibuya side Harajuku side 5. Acquisition Highlights External Growth ~Properties Acquired in the 15th Period (EDGE Shinsaibashi)~ 26
Short supply of offices in Shinsaibashi AA-13 EDGE Shinsaibashi Vacancy rate in the Shinsaibashi/Namba area remains at a low level (%) 25 1 Continuously evolving Shinsaibashi area Prime location 20 August 2018 15 2.6% Upside potential The area continues to evolve as many flagship stores of global luxury brands have been opening 10 5 Sponsor sourced Shinsaibashi is one of the leading areas in Japan in terms of rising official land prices 0 2008 2010 2012 2014 2016 2018 Unique and convenient property facing 2 Forecasted supply of Osaka office buildings is limited Midosuji Blvd. (thousand of tsubo) 60 With a standard floor area of 374 tsubo, the Forecast since 2018 August, 17 thousands tsubo property has an excellent competitive edge in 40 Shinsaibashi in terms of scale Namba Obic 20 SkyO Midosuji Convenient location with access to 6 train stations Bldg. and 8 lines 0 3 Pursuing upside potential in rent income The simulated market-to-actual rent gap of the office Shinsaibashi/Namba Office rent is at relatively high level space is large, and we are pursuing upside in rent （thousand yen /tsubo） Umeda We also aim to increase rent in the retail space upon 梅田 Shinsaibashi心斎橋・難波 18 Yodoyabashi/ Shinosaka future rent revision or tenant replacement Honmachi淀屋橋・本町 新大阪 16 14.9 Location Nishi Shinsaibashi, Chuo, Osaka, Osaka 14 12 11.9 11.1 4-minute walk from Shinsaibashi Station 10 10.3 Access and 5-minute walk from Namba Station 80 (Osaka Metro Midosuji Line etc.) 20082008年 2010 2010年 2012 2012年 20142014年 20162016年 20182018年 Acquisition price ¥19,800mn Upside potential of the property Appraisal value ¥20,000mn The office space has a higher simulated market- vs. appraisal value 99.0% to-actual Rent Gap than Tokyo Offices Forecast/Appraisal 3.7%/4.0% Rent gap NOI yield Average rent 18% Assumed market Occupancy rate 95.5% (as of Nov. 30, 2018) (office space) rent Completion date April 1986 ¥12,304 ¥14,500
Increased value through renovation Rise in published land prices and (in 2016 & 2017) increased inbound tourism 1F Office floor Growth Rate of Inbound Tourism to Japan Shinsaibashi official land prices (Compared the number of foreign tourists in 2011 and in 2016) Elevator hall Elevator hall (thousand yen/m2) 0 10 20 30 40 10,000 (%) ＋87％ “IWC SCHAFFHAUSEN” and “TOMORROWLAND” (1F shops) Japan 8,000 vs. 2013
Floor plan Sectional view Iceland 6,000
14F 4,000 Wedding Chile 13F Osaka: 42.9% 2,000 Standard floor area Exterior Prime area with high property values and Tokyo: 26.2% 374 tsubo 12F Korea 0 11F various new tenants Midosuji Boulevard Shinsaibashi-suji Portugal 10F Poltugal
9F (Note) Created by API based on “International tourism, number of (Note) Created by API based on official arrivals”(World Bank Group), “Survey of number of tourists land prices announced by Land Entrance Appraisal Committee of the MLIT 8F etc. in Tokyo”(Tokyo) and “Changes in number of arrival Offices overseas guests”(OSAKA CONVENTION & TOURISM BUREAU) 7F Redevelopment projects in the Shinsaibashi area Opening date 6F A bustling心斎橋東急ビル shopping arcade Usage Area (Plan) 5F Americamura Daimaru 4F (1) Shinsaibashi Fall 2019 Retail approx. 66,000m2 3F Main building 2F (2) Osaka M Project November 2019 Retail approx. 4,000m2 Entrance hall Elevator interior 1F Fashion Entrance hall A unique and trendy hub Hotel Royal Elevator hall Main street lined with brand stores -- October 2019 Hotel approx. 26,000m2 B1F Restaurants and cafes Classic Osaka Appendix 6. Appendix Portfolio Map 28 6. Appendix Portfolio ~Urban Retail Properties~ (1/3) 29
Tokyu Plaza Tokyu Plaza Akasaka Kyoto Karasuma Parking Property name Q plaza EBISU A-FLAG AKASAKA Kobe Kyu Kyoryuchi 25Bankan Omotesando Harajuku (Note 1) (Note 1) Building
Moto Honenji-cho, Nakagyo-ku, Location Jingu-mae, Shibuya-ku, Tokyo Nagatacho, Chiyoda-ku, Tokyo Ebisu, Shibuya-ku, Tokyo Akasaka, Minato-ku, Tokyo Kyomachi, Chuo-ku, Kobe, Hyogo Kyoyto
A 1-minute walk from Tokyo Metro Ginza Line, Marunouchi A 5-minute walk from Kobe subway Line A 1-minute walk from JR Yamanote A 3-minute walk from Tokyo Metro A 1-minute walk from Hankyu Kaigan Line “Kyu Kyoryuchi, A 1-minute walk from Tokyo Metro “Akasaka-mitsuke” Station Line, Saikyo Line, Shonan-Shinjuku Chiyoda Line “Akasaka” Station Kyoto Line “Karasuma” Station Daimarumae” Station Access Chiyoda Line, Fukutoshin Line, “Meiji A 1-minute walk from Tokyo Line/ A 5-minute walk from Tokyo Metro A 1-minute walk from subway 9-minute walk from JR Tokaido Line Jingumae” Station Metro Yurakucho Line, Tokyo Metro Hibiya Line Ginza Line, Marunouchi Line “Sannomiya” Station Karasuma Line “Shijo” Station “Akasaka-mitsuke” Station Hanzomon Line, “Ebisu” Station A 9-minute walk Namboku Line “Nagatacho” Station
Acquisition price (A) ¥45,000mn ¥11,450mn ¥8,430mn ¥8,860mn ¥3,000mn ¥21,330mn
Appraisal value (B) ¥45,200mn ¥11,500mn ¥8,770mn ¥9,430mn ¥3,150mn ¥21,600mn
vs appraisal value (A/B) 99.6% 99.6% 96.1% 94.0% 95.2% 98.8%
Appraisal NOI yield 3.9% 6.1% 4.5% 6.2% 4.5% 4.8%
Structure Steel framed, RC, SRC SRC Steel framed, RC Steel framed Steel framed, SRC Steel framed, SRC
7 floors above and 2 floors 14 floors above and 3 floors 6 floors above and 1 floor 9 floors above and 1 floor 7 floors above and 1 floor 18 floors above and 3 floors Number of floors underground underground underground underground underground underground
Gloss floor area (Note 2) 11,368.11m2(Total) 51,491.66m2(Total) 4,670.02m2 21,495.47m2 2,429.01㎡ 27,010.67㎡
Total leasable area (Note 2) 4,999.87m2 16,609.75m2 4,024.88m2 21,616.04m2 2,280.22㎡ 19,653.90㎡
Occupancy rate (Note 2) 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Key tenants (Note 2) Baroque Japan Limited Tokyu Hotels Co., Ltd. Tokyu Sports Oasis Inc. Times24 Co., Ltd. -（undisclosed） Plan Do See Inc.
Number of tenants (Note 2) 30 98 4 2 8 7
Located at the crossing of The strong international Located in the Ebisu area which Located in the Shijo Karasuma A 3-minute walking distance Located in Kobe, a port city Omotesando and Meiji Street, the flavor stems from the many is, unlike Shibuya or area, which is one of Kyoto’s from Tokyo Metro Chiyoda Line with long history, the area “Kyu center of Japan’s fashion culture foreign companies and Daikanyama, well known as an most prominent city center Kyoryuchi” has various historic “Akasaka” Station, and is Aiming to develop a “fashion embassies in this area. The area for grown-up areas sites/buildings and is one of the theme park” that enables Nagatacho and Kasumigaseki High-profile building located in Highly visible building with a convenient location where leading commercial districts in customers to enjoy the latest areas are located behind the front of a station with a large façade facing Karasuma Street, multiple stations and lines may West Japan in terms of the fashion and life-style themes in site façade made of terracotta bars it is a high-profile building with be used number of visitors an environment full of greenery Located in the busy and glass an automated parking lot open Facing “Hitotsugi Street”, the Kobe Luminarie takes place in Key points of properties commercial area of Tokyo 24 hours a day December every year Many tenants have positioned One of the few buildings with street with the heaviest foot their shops in this building as city-center, it has good significant presence in the West Highly important facility as it Tenants include Louis Vuitton their flagship or prototype shop commercial potential to exit area of “Ebisu” station provides parking space to retail traffic in Akasaka area where shop in the “Louis Vuitton considering the building’s attract diversified businesses where there are very few centers in the neighborhood concentrates various Maison” format offering a full excellent location and high Property is facing large-sized retail properties such as Daimaru Kyoto and restaurants lineup visibility Akasakamitsuke crossing Takashimaya Kyoto Leasing area is wide and Long-term lease of min. 5 between Sotobori Dori and enables versatile use suiting years contributing to a stable Route 246, with high visibility income needs of diverse tenants (Note 1) Tokyu Plaza Omotesando Harajuku and Tokyu Akasaka are calculated based on the pro rata share of the co-ownership interests (75％ and 50％, respectively), except the gross floor area and number of tenants, which indicate the amount for the whole building. (Note 2) Figures are provided as of Nov. 30, 2018 excluding Tokyu Plaza Ginza (Land)(as of Jan. 10, 2019). The same shall apply hereafter in the Portfolio pages. 6. Appendix Portfolio ~Urban Retail Properties~ (2/3) 30
A-FLAG BIJUTSUKAN A-FLAG DAIKANYAMA Property name A-FLAG SAPPORO A-FLAG SHIBUYA Q plaza SHINSAIBASHI A-FLAG KOTTO DORI DORI WEST
Minami-Yonjo-Nishi, Chuo-ku, Shinsaibashisuji, Chuo-ku, Osaka- Location Udagawa-cho, Shibuya-ku, Tokyo Minami-Aoyama, Tokyo Minami-Aoyama, Tokyo Sarugakucho, Shibuya-ku, Tokyo Sapporo, Hokkaido city, Osaka
A 4-minute walk from Tokyo Metro A 2-minute walk from Sapporo Ginza Line, Hanzoumon Line, subway Nanbou Line “Susukino” Fukutoshin Line/ A 1-minute walk from Osaka Metro A 4-minute walk from A 7-minute walk from A 4-minute walk from Station Tokyu Denentoshi Line, Toyoko Access Midosuji Line, Nagahori Tsurumi- “Omotesando” Station on the “Omotesando” Station on the “Daikanyama” Station on the A 8-minute walk from Sapporo Line “Shibuya” Station ryokuchi Line “Shinsaibashi” Station Tokyo Metro Tokyo Metro Tokyu Toyoko Line subway A 6-minute walk from JR Yamanote Toho Line “Hosui-susukino” Station Line, Saikyo Line, Shonan-Shinjuku Line “Shibuya” Station
Acquisition price (A) ¥4,410mn ¥6,370mn ¥13,350mn ¥4,370mn ¥4,700mn ¥2,280mn
Appraisal value (B) ¥4,800mn ¥6,400mn ¥13,400mn ¥4,570mn ¥4,740mn ¥2,300mn
vs appraisal value (A/B) 91.9% 99.5% 99.6% 95.6% 99.2% 99.1%
Appraisal NOI yield 8.7% 4.9% 3.9％ 4.3% 3.9% 4.0%
Structure Steel framed, RC RC Steel framed, SRC, RC Reinforced concrete SRC, steel framed SRC 12 floors above and 1 floor 5 floors above and 1 floor 8 floors above and 2 floors Number of floors 5 floors above and 2 floors 2 floors above and 2 floors 4 floors above and 2 floor underground underground underground underground underground underground Gross floor area 27,277.85㎡ 3,340.70㎡ 3,822.45㎡ 3,358.28m2 2,221.98m2 4,036.27m2 Total leasable area 21,229.16㎡ 3,417.70㎡ 2,820.23㎡ 2,656.53 ㎡ 1,994.65 ㎡ 2,579.08 ㎡ Occupancy rate 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Key tenants Tokyu Hotels Co., Ltd. G.U. CO., LTD. cocokara fine Inc. AMAN CO., LTD. BLUE NOTE JAPAN, INC. - (undisclosed)
Number of tenants 17 2 6 7 4 1
Located in Susukuno, the most Located in Shibuya area, one Located in the front entrance A high versatile space able to Located on Museum Street, Located along “Hachiman popular entertainment district of the major commercial of “Shinsaibashi”, the top meet various commercial connecting “Kotto Street” and Street”, the main street of needs ranging from small- “Miyuki Street”, where many Daikanyama area in Hokkaido and one of Japan’s districts in Japan and the commercial area in Western scale units of approx. 6 tsubo visitors stroll around Location Very close to Daikanyama major tourist spots fashion centers for "young Japan to large-scale units of approx. near Nezu Museum, Taro crossing, center of the area A retail property holding a generations" Shinsaibashi has the ability to 130 tsubo Okamoto Memorial Museum with sophisticated apparel hotel and restaurants with An urban retail property in attract customers as Office spaces are equipped and other cultural facilities shops, cafés and restaurants high visibility in a 2-minute “Shibuya Center Street”, commercial focal point with with sufficiently high- Rare property in the fashion- scattered throughout specification facilities to meet conscious walk from “Susukino” Station designed to fit the district passersby reaching about Area draws visitors from Key points of tenants’ needs and are highly Omotesando/Minami-Aoyama broader areas since the Sapporo Snow Festival is held feature attracting people all 98,000 people properties competitive in this area area, including unique tenants opening of large-scale retail every February in the city day and night Conveniently located with a 1- such as Blue Note Tokyo and properties in 2011 Club Quattro is a long- minute walk from Osaka Metro DS STORE Elaborated design appeals to established club, hosts live “Shinsaibashi” Station, directly tenants who prefer the high- music and has invited a variety connecting to Crysta Nagahori end image of the area of artists from both Japan and abroad for over 25 years 6. Appendix Portfolio ~Urban Retail Properties~ (3/3) 31
Property name A-FLAG KITA SHINSAIBASHI DECKS Tokyo Beach (Note) Tokyu Plaza Ginza (Land) (Note) Q plaza HARAJUKU (Note)
Location Senba, Chuo-ku, Osaka-city, Osaka Daiba, Minato-ku, Tokyo Ginza, Chuo-ku, Tokyo Jingu-mae, Shibuya-ku, Tokyo
A 2-minute walk from “Odaibakaihinkoen” Station on the Tokyo Waterfront 1-minute walk from “Ginza” Station on the A 3-minute walk from “Shinsaibashi” New Transit Waterfront Line 2-minute walk from “Meiji-jingumae Tokyo Metro Marunouchi Line, Ginza Line, Access Station on the Osaka Metro A 5-minute walk from “Tokyo
Acquisition price (A) ¥4,725mn ¥12,740mn ¥37,500mn ¥13,200mn
Appraisal value (B) ¥4,770mn ¥12,887mn ¥39,000mn ¥13,300mn
vs appraisal value (A/B) 99.1% 98.9% 96.2% 99.2%
Appraisal NOI yield 4.3% 4.4％ 2.5% 3.1%
Structure SRC, steel framed Steel framed - SRC, steel framed
(Building A) 11 floors above and 2 floors 7 floors above and 1 floor underground Number of floors 8 floors above - underground (Building B) 2 floors above and 1 floors underground Gross floor area 3,096.18㎡ 67,506.91㎡ - 7,667.27㎡
Total leasable area 2,536.75㎡ 16,112.00㎡ 1,130.04㎡ 3,378.49㎡
Occupancy rate 100.0% 100.0% 100.0% 95.2%
Key tenants PRESS Corporation Inc. CA Sega Joypolis Ltd. Sumitomo Mitsui Trust Bank, Limited Take and Give Needs Co., Ltd
Number of tenants 5 85 1 15
Located at a 3-min walk from Located next to “Odaiba-kaihinkoen” Located in Ginza, an high competitive Located in an area bustling with people “Shinsaibashi” Station Station commercial area where many going back and forth between Harajuku international brands have their shops Facing the arcade of Shinsaibashisuji 3rd floor with wood decks connected to and Shibuya North shopping street, a busy street neighbor commercial facilities and At the corner of Sukiyabashi Intersection with very busy traffic even for Ginza Facing Meiji Street with growth potential with many stores Odaiba Kaihin park area by development projects Standing on a highly visible corner “Hands-on experience” tenants such as 70-year land lease contributing long- Includes 1st facility in Kanto region of a Key points of properties Accessible directly to 2nd floor and “Tokyo Joypolis”, “LEGOLAND Discovery term stability underground floor by stairs from Center Tokyo” and “Madame Tussauds wedding company and 1st restaurant in streetlevel in addition to an elevator Tokyo” Japan of a food service provider Diverse tenants meeting various daily Offers a great view of the Rainbow needs such as fitness gym, live music Bridge and illumination of Odaiba-kaihin club and cellular phone store Park, attracting both overseas and domestic tourists (Note) DECKS Tokyo Beach, Tokyu Plaza Ginza (Land) and Q plaza HARAJUKU are calculated based on the pro rata share of the co-ownership interests (49％, 30% and 60％, respectively), except the gross floor area and number of tenants, which indicate the amount for the whole building. 6. Appendix Portfolio ～Tokyo Office Properties～ (1/3) 32
Property name TLC Ebisu Building A-PLACE Ebisu Minami A-PLACE Yoyogi A-PLACE Aoyama Luogo Shiodome TAMACHI SQUARE (Land)
Ebisu, Shibuya-ku, Ebisu-Minami, Shibuya-ku, Sendagaya, Shibuya-ku, Kita-Aoyama, Minato-ku, Higashi Shinbashi, Minato-ku, Shiba, Minato-ku, Location Tokyo Tokyo Tokyo Tokyo Tokyo Tokyo A 4-minute walk from A 4-minute walk from Toei Oedo Line/ Yurikamome A 2-minute walk from JR Yamanote Line, Saikyo Line, A 4-minute walk from A 3-minute walk from "Shiodome" Station Toei Asakusa Line, Mita Line Shonan-shinjuku Line JR Yamanote Line, Saikyo Line, JR Yamanote Line, A 4-minute walk from A 5-minute walk from "Mita" Station Access "Ebisu" Station Shonan-Shinjuku Line/ Chuo Line, Sobu Line/ Tokyo Metro Ginza Line JR Tokaido Line, Yamanote Line, A 4-minute walk from A 6-minute walk from Tokyo Metro Hibiya Line Toei Oedo Line "Gaienmae" Station Keihin-Tohoku Line, Yokosuka JR Yamanote Line, Tokyo Metro Hibiya Line "Ebisu" Station "Yoyogi" Station Line/ Tokyo Metro Ginza Line/ Keihin-Tohoku Line "Ebisu" Station Toei Asakusa Line/ Yurikamome “Tamachi” Station "Shinbashi" Station
Acquisition price (A) ¥7,400mn ¥9,640mn ¥4,070mn ¥8,790mn ¥4,540mn ¥2,338mn
Appraisal value (B) ¥7,420mn ¥9,950mn ¥4,180mn ¥8,850mn ¥4,570mn ¥2,400mn
vs appraisal value (A/B) 99.7% 96.9% 97.4% 99.3% 99.3% 97.4%
Appraisal NOI yield 5.4% 4.9% 5.1% 5.0% 4.7% 4.7%
Structure SRC SRC Steel framed RC Steel framed, RC - 9 floors above and 1 floor 6 floors above and 1 floor 10 floors above and 1 floor 9 floors above and 1 floor 11 floors above and 1 floor Number of floors - underground underground underground underground underground Gross floor area 10,297.73m2 12,167.57m2 4,201.59m2 9,958.33m2 8,242.61m2 -
Total leasable area 7,342.60m2 7,950.49m2 3,106.17m2 7,303.69m2 4,476.35m2 1,287.96m2
Occupancy rate 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
The building is in the high Suited to the high traffic of Ebisu Highly visible building located on Has strong competitive Located on the north side of Convenient location close to profile area of Ebisu, which area and high demand by IT the roadside of Meiji Street advantages compared with the Shiodome Siosite‘s western center of the city with a good has the highest concentration companies including software Approx. 346m2 astylar space on office buildings in the district, known as “Italy Town” traffic convenience with several of office buildings developers, apparel companies, one floor allows highly efficient neighborhood due to its large which has a high traffic JR and Toei lines as well as service providers such Area around “Tamachi” Station Compared with other space usage size convenience is highly concentrated of large buildings in the neighborhood, as restaurants, beauty salons Versatile rectangular building Large-scale renovation of the Higher competitiveness and clinics and schools companies because of easy its large floor size of approx. shape equipped with shared building including seismic compared with other office access to “Shinagawa” Station Key points of properties 805m2 on standard floors Large standard floor area of facilities along the sides allows strengthening completed in properties in the neighborhood approx. 1,655 m2 providing Tokaido Shinkansen makes it highly competitive partial leasing of the floor 2008 due to its quakeabsorbing (bullet train), and to Large-scale renovations were Above-ground ample parking structure “Hamamatsu” Station providing completed in 2011, and the spaces provides an attractive Strong demand expected from direct access to Haneda Airport building continues to be a feature to companies including affiliates and customers of the on JR Line high grade property apparel companies that need to large corporations in other large deliver products and equipment buildings around "Shiodome" station 6. Appendix Portfolio ～Tokyo Office Properties～ (2/3) 33
OSAKI WIZTOWER Property name A-PLACE Ikebukuro A-PLACE Shinbashi A-PLACE Gotanta A-PLACE Shinagawa Shiodome Building (Note) (4-11th floors)
Minami Ikebukuro, Toshima-ku, Nishigotanda, Shinagawa-ku, Location Shinbashi, Minato-ku, Tokyo Konan, Minato-ku, Tokyo Osaki, Shinagawa-ku, Tokyo Kaigan, Minato-ku, Tokyo Tokyo Tokyo A 6-minute walk from JR Yamanote Line, Saikyo Line, A 3-minute walk from JR Tokaido A 3-minute walk from A 4-minute walk from A 3-minute walk from JR Line Shonan-Shinjuku Line/ Tokyo Line, Yamanote Line, KeihinTohoku Toei Asakusa Line JR Tokaido Shinkansen, Tokaido A 4-minute walk from “Hamamatsucho” Station Metro Marunouchi Line, Line, Yokosuka Line/ "Gotanda" station Line, Yamanote Line, KeihinTohoku JR Yamanote Line, Saikyo Line, Access A 3-minute walk from Toei Oedo Yurakucho Line, Fukutoshin Line/ Tokyo Metro Ginza Line/ Toei A 4-minute walk from Line, Yokosuka Line/ Shonan-Shinjuku Line/ Rinkai Line Line/ Asakusa Line Seibu Ikebukuro Line/ Tobu Tojo Asakusa Line/ Yurikamome JR Yamanote Line Keikyu Main Line "Osaki" Station “Daimon” Station Line "Shinbashi" Station "Gotanda" Station "Shinagawa“ Station "Ikebukuro" Station
¥10,690mn ¥30,300mn / ¥20,400mn Acquisition price (A) ¥3,990mn ¥5,650mn ¥5,730mn ¥3,800mn (sectional ownership) / ¥20,900mn
¥30,450mn / ¥20,700mn Appraisal value (B) ¥4,020mn ¥5,780mn ¥5,750mn ¥3,800mn ¥11,200mn(Sectional ownership) / ¥21,100mn
vs appraisal value 99.3% 97.8% 99.7% 100.0% 95.4% 99.5％ / 98.6%/99.1% (A/B)
Appraisal NOI yield 5.2% 5.1% 4.5% 4.6% 4.6% 4.2% / 4.1%/3.9%
Structure Steel framed, RC RC, SRC RC, SRC RC, SRC RC, SRC RC, SRC
7 floors above and 1 floor 9 floors above and 2 floors 10 floors above and 1 floor 8 floors above and 1 floor 25 floors above and 2 floors 24 floors above and 2 floors Number of floors underground underground underground underground underground (total) underground Gross floor area 4,709.05m2 7,143.97m2 5,782.65㎡ 3,937.61㎡ 54,363.84㎡(Total) 115,930.83㎡ (Total) 7,193.28㎡ Total leasable area 3,409.73m2 5,052.14m2 4,028.69㎡ 2,986.36㎡ 28,136.05㎡ (Sectional ownership) Occupancy rate 100.0% 98.7% 100.0% 100.0% 100.0% 100.0%
Located along Meiji Street enjoying Conveniently located with a 3- Good location with a 3-minute High traffic convenience located a High convenience with a 4- Well located close to high visibility minute walk from “Shinbashi” walk from Toei Asakusa Line 4-minute walk from “Shinagawa” minute walk from "Osaki“ Station “Hamamatsucho” Station with a Further development of area is Station serviced by JR, Tokyo “Gotanda” Station and 4-minute Station with easy access to major on JR Yamanote Line high visibility expected with redevelopment plan Metro Ginza Line, Toei Asakusa walk from JR “Gotanda” Station areas in Tokyo by several JR lines Having BCP (Business Continuity Only a 3-minute walk from JR of the land of former Toyoshima Line and Yurikamome Line An office building with a high and Tokaido Shinkansen (bullet Planning) facilities such as “Hamamatsucho” Station and ward municipal building and its Can be expected various tenant profile facade, developed by train) and to Haneda Airport by emergency power generation Toei “Daimon” Station with a surrounding needs from different business Tokyu Land Corporation Keikyu Line system enabling consecutive 48- direct access to Haneda Airport types and categories taking Relatively compact rental area hour electric power supply in and major rail terminal stations Key points of properties L-shaped floor with shared The relative new building is facilities along the sides offering a advantage of traffic convenience equipped with high-tech facilities with no pillars in the office addition to the newest such as Tokyo and Shinagawa large versatility Further development is expected including 100mm-high free- spaces, allowing for efficient and earthquake resistant structure Possess a highly competitiveness with redevelopment plan of access floors, individual air versatile use of the floors with standard office floor area of Shinbashi East exit area conditioning units and grid Sufficient facility specification to more than 1,000 tsubo, a rarity Implemented renovation works of ceilings meet tenant needs equipped with in Tokyo market, also is capable 2-5th floors in 2012-2013 with individual OA floor and air to divide the floor space which conditioner responds a variety of tenants needs
(Note) Shiodome Building is calculated based on the pro rata share of the co-ownership interests (35％), except the gross floor area which indicates the amount for the whole building. 6. Appendix Portfolio ～Tokyo Office Properties～ (3/3) 34
Property name A-PLACE Ebisu Higashi A-PLACE Shibuya Konnoh A-PLACE Gotanda Ekimae A-PLACE Shinagawa Higashi A-PLACE Shinbashi Ekimae
NishiGotanda, Shinagawa-ku, Location Higashi, Shibuya-ku, Tokyo Shibuya, Shibuya-ku, Tokyo Konan, Minato-ku, Tokyo Shinbashi, Minato-ku, Tokyo Tokyo
A 1-minute walk from “Shinbashi” A 6-minute walk from A 1-minute walk from A 7-minute walk from “Shinagawa” station on JR Tokaido Line, JR Yamanote Line, Saikyo Line, A 4-minute walk from JR Yamanote Line/ station on the JR Yamanote Line, Yamanote Line / Keihin-Tohoku Access Shonan-Shinjuku Line/ JR Yamanote Line Toei Asakusa Line/ Tokaido Shinkansen, Todaido Line, Line, Yokosuka Line / Tokyo Metro Tokyo Metro Hibiya Line “Shibuya” station Tokyu Ikegami Line Keihin-Tohoku Line and Yokosuka "Ebisu" Station “Gotanda” Station Line, and the Keikyu Line Ginza Line, Toei Asakusa Line, Yurikamome
Acquisition price (A) ¥7,072mn ¥4,810mn ¥7,280mn ¥18,800mn ¥20,500mn
Appraisal value (B) ¥7,160mn ¥4,900mn ¥7,390mn ¥19,000mn ¥22,500mn
vs appraisal value (A/B) 98.8% 98.2% 98.5% 98.9％ 91.1%
Appraisal NOI yield 4.4% 4.4% 4.3％ 4.2％ 5.4%
Structure SRC RC, SRC SRC SRC Steel framed, SRC
10 floors above and 2 floors 8 floors above and 1 floor 9 floors above and 1 floor 8 floors above and 1 floor 10 floors above and 1 floor Number of floors underground underground underground underground underground
Gross floor area 5,321.23m2 4,331.70m2 5,961.02㎡ 21,114.32㎡ 8,541.70m2
Total leasable area 4,010.69m2 2,995.72m2 4,316.89㎡ 14,658.98㎡ 6,484.57m2
Occupancy rate 100.0% 100.0% 100.0％ 100.0％ 100.0%
Great lighting and visibility as it South entrance of Shibuya Just 1-minute walk from the JR Excellent traffic links given the A 1-minute walk from convenient is located at the corner and along Station is expected to be Yamanote Line “Gotanda” accessibility to the Tokaido “Shinbashi” station, one of the the Meiji street which is 6-minute developed with better Station Shinkansen (bullet train), along busiest terminal stations in Japan walk from "Ebisu" station with several JR Lines, and direct accessibility through Features a standard office floor Located in an area with diverse Well in appealing tenants in improvement of Shibuya Station access to Haneda Airport via the properties, such as office terms of facilities following the area of 148 tsubo with a ceiling Keikyu Line buildings, restaurants, apparel and its surroundings as well as renewal of entrance/restroom height of 2,600 mm, individual The area is expected to develop shops, and entertainment and individualizing air redevelopment on such area air conditioning units, free further with the prospective facilities, including karaoke conditioner despite the age of 20 It underwent large-scale access floor, etc. The astylar opening of the Linear facilities and bustle with visitors years renovations from 2011 to 2012 style rooms can be divided Shinkansen (bullet train) to Ginza and office workers in the which enables to address flexibly area Key points of properties Implemented a large-scale Owns high competitiveness the needs from tenants Large renovation works including renovation of external wall from thanks to great specifications installation of entrance to office 2016 to 2017 Addresses a wide range of with standard floor area of demands of tenants including floors completed in 2018 approx.687 tsubo and renewal Building has a standard floor retail stores, owning to works area of 205 tsubo and is locational rarity and high equipped with a 3 meter-high visibility from the station ceiling and individual air conditioners 6. Appendix Portfolio ～Activia Account properties～ (1/2) 35
Property name Amagsaki Q’s MALL (Land) icot Nakamozu icot Mizonokuchi icot Tama Center A-PLACE Kanayama Osaka Nakanoshima Building
Kanayama, Naka-ku, Nagoya City, Nakanoshima, Kita-ku, Osaka City, 428-2 Nakamozucho 3-cho, Mizonokuchi, Takatsu-ku, Location Shioe, Amagasaki City, Hyogo Ochiai, Tama City, Tokyo Aichi Osaka Kita-ku, Sakai City, Osaka Kawasaki City, Kanagawa
A 4-minute walk from Keio A 1-minute walk from A 6-minute walk from Osaka Sagamihara Line "Keio Tama Nagoya Municipal Subway Meijo A 1-minute walk from Metro Midosuji Line A 2-minute walk from A 13-minute walk from Center" Station Line/Meiko Line "Kanayama" Keihan Nakanoshima Line "Nakamozu" Station JR Tokaido Main Line, Tokyu Denen Toshi Line/ A 4-minute walk from Odakyu Station “Oebashi” Station Access A 6-minute walk from Nankai Koya Fukuchiyama Line, Tozai Line Oimachi Line Tama Line "Odakyu Tama Center" A 2-minute walk from A 5-minute walk from Line “Shirasagi” Station "Amagasaki" Station "Takatsu" Station Station JR Chuo Line, Tokaido Line/ Osaka Municipal Subway Midosuji A 8-minute walk from Nankai Koya A 4-minute walk from Tama Toshi Meitetsu Nagoya Main Line Line “Yodoyabashi” Station Line “Nakamozu” Station Monorail "Tama Center" Station "Kanayama" Station
¥2,840mn Acquisition price (A) ¥12,000mn ¥8,500mn ¥2,710mn ¥6,980mn ¥5,250mn / ¥5,850mn (Sectional Ownership)
¥2,990mn Appraisal value (B) ¥12,100mn ¥8,880mn ¥2,950mn ¥7,120mn ¥5,800mn / ¥5,900mn (Sectional Ownership) vs appraisal value (A/B) 99.2% 95.7% 91.9% 95.0% 98.0% 90.5%/99.2%
Appraisal NOI yield 5.0% 6.4% 6.7% 6.6% 5.6% 6.2%/5.5%
Structure - Steel framed Steel framed RC Steel framed, SRC SRC
4 floors above and 1 floor 15 floors above and 1 floor 9 floors above and 1 floor 15 floors above and 3 floors Number of floors - 3 floors above underground underground (total) underground underground
Gloss floor area - 27,408.34m2 14,032.05m2 31,553.75m2(total) 12,783.13m2 34,248.71m2
5,181.58m2 Total leasable area 27,465.44㎡ 28,098.02m2 14,032.05m2 9,314.90m2 20,229.25m2 (sectional ownership)
Occupancy rate 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Multi-tenant property that Located in Nakamozu area where Good access from the Tokyo city High traffic convenience with Property is located in front of The Nakanoshima area features represents Amagasaki city and is housing concentration is growing center as property is facing the access by Keio Sagamihara Line "Kanayama" Station which has many office buildings, including directly connected to the JR train steadily as it connects Osaka City trunk road and possessing a and Odakyu Tama Line good access to "Nagoya" station financial institutions and station. Its tenants include the with Senboku New Town promising trade area High concentration of residents in and Chubu International Airport. government offices, such as the largest sports club and cinema It is one of the No. 1 Property presents one of the few an area which is located in the The large standard floor size of Bank of Japan Osaka branch and complex in the region also around neighborhood shopping centers in opportunities to major retailers center of Tama New Town, 300 tsubo and its landmark the Osaka City Hall, as well as Key points of properties 140 boutiques the nearby commercial area who want to open their shops property designed to be fully exterior ensures sufficient offices of major companies such Stable income expected owning roadside. integrated in the city is connected competitiveness in the area as The Asahi Shimbun Company Stable income is expected due to and Kansai Electric Power to the 20-year fixed-term building Stable income ensured by fixed- with a station and retail properties the 30-year term leasehold lease contracts with such core term leasing contracts with actual by a pedestrian walkway agreement (land) for commercial tenants tenant through 2023 use with the leaseholder 6. Appendix Portfolio ～Activia Account～ (2/2) 36
Umeda Gate Tower Property name icot Omori Market Square Sagamihara A-PLACE Bashamichi Commercial Mall Hakata EDGE Shinsaibashi (5-20th floors）
Shimokuzawa, Chuo-ku, Honcho, Naka-ku, Yokohama, Tokojimachi 2-chome, Hakata-ku, Nishishinsaibashi, Chuo-ku, Location Omorikita, Ota-ku, Tokyo Tsurunocho, Kita-ku, Osaka, Osaka Sagamihara-city, Kanagawa Kanagawa Fukuoka-city, Fukuoka Osaka-city, Osaka
A 3-minute walk from “Umeda” Station on the Hankyu Kyoto Line A 15-minute walk from JR A 1-minute walk from “Bashamichi” 4-minute walk from “Shinsaibashi” A 3-minute walk from A 6-minute walk from “Umeda” A 16-minute walk from “Takeshita” Sagamihara Station on Minatomirai Line Station and 5-minute walk Access JR Keihitohoku Line Station on the Osaka Metro Midosuji Station on the JR Kagoshima Main Line A 7-minute walk from “Kannai” from “Namba” Station on the Osaka "Omori" Station Line Line “Minamihashimoto” Station Station on JR Negishi Line Metro Midosuji Line, etc. A 7-minute walk from “Osaka” Station on the JR Tokaido Main Line
¥19,000mn Acquisition price (A) ¥5,790mn ¥4,820mn ¥3,930mn ¥6,100mn ¥19,800mn (Sectional ownership)
¥19,600mn Appraisal value (B) ¥5,810mn ¥4,820mn ¥4,350mn ¥6,270mn ¥20,000mn (Sectional ownership) vs appraisal value (A/B) 99.7% 100.0% 96.9％ 90.3% 97.3% 99.0％
Appraisal NOI yield 5.1% 5.5% 4.3％ 6.4％ 5.0% 4.0％
SRC, Reinforced concrete, Steel Structure RC, SRC Steel framed Steel framed, SRC SRC Steel framed framed
7 floors above and 1 floor 21 floors above and 1 floor 12 floors above and 2 floors 14 floors above and 2 floors Number of floors 2 floors above 3 floors above underground underground (total) underground underground
Gross floor area 7,040.95㎡ 9,719.38㎡ 22,003.14㎡ (total) 14,009.06㎡ 13,848.76㎡ 23,483.28㎡
13,624.49㎡ Total leasable area 6,209.79㎡ 15,152.42㎡ 9,775.50㎡ 9,612.88㎡ 15,950.45㎡ (sectional ownership)
Occupancy rate 100.0% 100.0% 100.0％ 100.0％ 97.0% 93.8%
A retail property located a 3- Newly opened in July 2014 Located in Umeda area, one of Located above Located in Hakata-ku, Fukuoka- Facing Midosuji Boulevard where minute walk from Omori Station “Bashamichi“ Station with a 1- city, which has the largest Tenants－a major home leading business and commercial Has an excellent competitiveness near the rotary in front of the electronics retailer K's Denki, a districts in Osaka minute walk population growth rate among station Japan’s government-designated with a standard floor area of 374 major supermarket chain OK A large-scale office building Concentration of government cities tsubo in Shinsaibashi area where Deserved competitiveness as a Store, and a well-known revolving completed in 2010, with a gross administration offices including community-based property close Kanagawa Pref. Government’s Widely facing the Chikushi Street, middle and small size offices sushi chain Hamazushi－cater to floor area of approx. 6,700 tsubo to the station with tenants related Office and Yokohama Second a heavy traffic road with two lanes cumulate to commodity business the needs of local area residents Equipped with the latest Common Government Office, and in each direction, the property is specification such as 16-zone Renovation work of external and Tenants a major sport club Yokohama i-Land TOWER in which highly visible and easily accessible Key points of property individual air-conditioning system common area implemented from equipped with a swimming pool Urban Renaissance Agency sets A commercial facility attracting and high-performance seismic 2016 to 2017 and building’s grade with 8 lanes and studios in structural control system up its headquarter crowds by various tenants approx.1,200 tsubo A multi-tenant office building with including nation-wide chains such improved Standard office floor area of approx. 265 tsubo, the rental a standard floor area of 347 as TSUTAYA and UNIQLO space in rectangular shape with tsubo, reducing the risk of astylar structure dividable into up vacancy to 8 spaces, addressing the needs of variety of tenants 6. Appendix Appraisal Values of Properties 37
Total appraisal value at the end of the 14th Period (ended Nov. 30, 2018) is up ¥6.7bn from the previous period with unrealized gain increased to ¥81.7bn due to decreased Cap Rate and improved account balance (in millions of yen) Book value at Appraisal value Difference from Difference from Difference from Acquisition price Investment ratio Category Property # Property name end of Nov. 30 As of May 31, As of Nov. 30, Cap rate as of previous period acquisition price book value (A) (%) (B) 2018 (C) 2018 (D) Nov. 30, 2018 (D-C) (D-A) (D-B) UR-1 Tokyu Plaza Omotesando Harajuku (Note 1) 45,000 10.4% 44,757 59,100 61,200 2.7% 2,100 16,200 16,443 UR-2 Tokyu Plaza Akasaka (Note 1) 11,450 2.7% 11,744 15,000 15,500 4.0% 500 4,050 3,756 UR-3 Q plaza EBISU 8,430 2.0% 8,251 11,300 11,900 3.2% 600 3,470 3,649 UR-5 Kyoto Karasuma Parking Building 8,860 2.1% 8,736 11,000 11,000 4.9% 0 2,140 2,264 UR-6 A-FLAG AKASAKA 3,000 0.7% 3,070 3,730 3,750 3.5% 20 750 680 UR-7 Kobe Kyu Kyoryuchi 25Bankan 21,330 4.9% 20,753 26,800 26,900 4.0% 100 5,570 6,147 UR-8 A-FLAG SAPPORO 4,410 1.0% 4,723 7,080 7,090 5.5% 10 2,680 2,367 UR-9 A-FLAG SHIBUYA 6,370 1.5% 6,358 7,430 7,930 4.0% 500 1,560 1,572 UR-10 Q plaza SHINSAIBASHI 13,350 3.1% 13,437 14,600 14,600 3.6% 0 1,250 1,163 UR-11 A-FLAG KOTTO DORI 4,370 1.0% 4,401 4,880 4,880 3.5% 0 510 479 UR-12 A-FLAG BIJUTSUKAN DORI 4,700 1.1% 4,722 4,760 4,920 3.6% 160 220 198 UR-13 A-FLAG DAIKANYAMA WEST 2,280 0.5% 2,345 2,340 2,340 3.9% 0 60 -5 UR-14 A-FLAG KITA SHINSAIBASHI 4,725 1.1% 4,847 4,740 4,740 3.9% 0 15 -107 UR-15 DECKS Tokyo Beach (Note 1) 12,740 3.0% 12,892 12,887 12,887 4.0% 0 147 -5 subtotal 151,015 35.0% 151,044 185,647 189,637 - 3,990 38,622 38,592 TO-1 TLC Ebisu Building 7,400 1.7% 7,289 10,300 10,800 3.6% 500 3,400 3,511 TO-2 A-PLACE Ebisu Minami 9,640 2.2% 9,411 13,900 14,600 3.5% 700 4,960 5,189 TO-3 A-PLACE Yoyogi 4,070 0.9% 3,907 4,710 4,710 3.9% 0 640 803 TO-4 A-PLACE Aoyama 8,790 2.0% 8,615 9,970 10,100 4.0% 130 1,310 1,485 TO-5 Luogo Shiodome 4,540 1.1% 4,256 6,220 6,220 3.6% 0 1,680 1,964 TO-6 TAMACHI SQUARE (Land)(Note2) 2,338 0.5% 2,362 2,770 2,830 3.6% 60 492 468 TO-7 A-PLACE Ikebukuro 3,990 0.9% 3,757 5,020 5,120 4.1% 100 1,130 1,363 TO-8 A-PLACE Shinbashi 5,650 1.3% 5,701 6,670 7,080 3.8% 410 1,430 1,379 TO-9 A-PLACE Gotanda 5,730 1.3% 5,529 6,940 6,970 3.7% 30 1,240 1,441 TO-10 A-PLACE Shinagawa 3,800 0.9% 3,787 4,300 4,400 3.6% 100 600 613 TO-11 OSAKI WIZTOWER 10,690 2.5% 10,713 14,600 14,600 3.5% 0 3,910 3,887 TO-12 Shiodome Building (Note 1) 71,600 16.6% 71,141 75,600 75,600 3.4% 0 4,000 4,459 TO-13 A-PLACE Ebisu Higashi 7,072 1.6% 7,112 7,700 7,700 3.7% 0 628 588 TO-14 A-PLACE Shibuya Konnoh 4,810 1.1% 4,970 5,350 5,350 3.6% 0 540 380 TO-15 A-PLACE Gotanda Ekimae 7,280 1.7% 7,546 7,690 7,690 3.8% 0 410 144 TO-16 A-PLACE Shinagawa Higashi 18,800 4.4% 18,876 19,500 19,500 3.9% 0 700 624 TO-17 A-PLACE Shinbashi Ekimae 20,500 4.8% 20,921 20,300 20,500 3.6% 200 0 -421 subtotal 196,700 45.6% 195,900 221,540 223,770 - 2,230 27,070 27,869 AA-1 Amagasaki Q's MALL (Land) 12,000 2.8% 12,113 13,900 13,900 4.3% 0 1,900 1,787 AA-2 icot Nakamozu 8,500 2.0% 8,137 10,300 10,500 5.0% 200 2,000 2,363 AA-4 icot Mizonokuchi 2,710 0.6% 2,629 3,230 3,170 5.5% -60 460 541 AA-5 icot Tama Center 2,840 0.7% 2,645 3,890 3,880 5.1% -10 1,040 1,235 AA-6 A-PLACE Kanayama 6,980 1.6% 6,377 8,530 8,550 5.1% 20 1,570 2,173 AA-7 Osaka Nakanoshima Building 11,100 2.6% 10,970 14,100 14,300 4.0% 200 3,200 3,330 AA-8 icot Omori 5,790 1.3% 5,674 6,750 6,870 4.4% 120 1,080 1,196 AA-9 Market Square Sagamihara 4,820 1.1% 4,709 5,030 5,020 5.3% -10 200 311 AA-10 Umeda Gate Tower 19,000 4.4% 19,431 21,300 21,300 3.7% 0 2,300 1,869 AA-11 A-PLACE Bashamichi 3,930 0.9% 4,012 4,500 4,500 4.9% 0 570 488 AA-12 Commercial Mall Hakata 6,100 1.4% 6,336 6,270 6,290 4.8% 20 190 -46 subtotal 83,770 19.4% 83,038 97,800 98,280 - 480 14,510 15,241 Total 431,485 100.0% 429,984 504,987 511,687 - 6,700 80,202 81,702 (Note 1) Tokyu Plaza Omotesando Harajuku, Tokyu Plaza Akasaka, DECKS Tokyo Beach and Shiodome Building are calculated based on the pro rata share of co-ownership interest (75%, 50%, 49% and 35%, respectively). (Note 2) The acquisition price for TAMACHI SQUARE (Land) represents the acquisition price of the land as of the acquisition date (June 13, 2012). 6. Appendix
Trends of Cap Rate (Note 1) 38
Property Acquisition At 2012.11 2013.5 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11 Category Property name Acquisition date # price (\mn) acquisition (2nd Period) (3rd Period) (4th Period) (5th Period) (6th Period) (7th Period) (8th Period) (9th Period) (10th Period) (11th Period) (12th Period) (13th Period) (14th Period) Tokyu Plaza Omotesando Harajuku UR-1 (Note 2) 2012/6/13 45,000 3.8% 3.7% 3.7% 3.6% 3.4% 3.3% 3.2% 3.1% 3.1% 3.0% 2.9% 2.8% 2.8% 2.7% UR-2 Tokyu Plaza Akasaka (Note 2) 2012/6/13 11,450 5.3% 5.3% 5.2% 5.1% 4.9% 4.8% 4.6% 4.5% 4.4% 4.3% 4.2% 4.1% 4.1% 4.0% UR-3 Q plaza EBISU 2012/6/13 8,430 4.3% 4.3% 4.2% 4.2% 4.1% 4.0% 3.9% 3.8% 3.7% 3.6% 3.5% 3.4% 3.3% 3.2% UR-5 Kyoto Karasuma Parking Building 2012/6/13 8,860 5.7% 5.7% 5.7% 5.6% 5.5% 5.4% 5.3% 5.2% 5.1% 5.0% 4.9% 4.9% 4.9% 4.9% UR-6 A-FLAG AKASAKA 2013/8/30 3,000 4.3% - - 4.3% 4.2% 4.0% 3.9% 3.8% 3.8% 3.7% 3.7% 3.6% 3.6% 3.5% UR-7 Kobe Kyu Kyoryuchi 25Bankan 2013/12/19 21,330 4.8% - - - 4.7% 4.6% 4.5% 4.3% 4.2% 4.1% 4.1% 4.0% 4.0% 4.0% UR-8 A-FLAG SAPPORO 2013/12/19 4,410 6.5% - - - 6.2% 6.0% 6.0% 5.9% 5.8% 5.7% 5.6% 5.5% 5.5% 5.5% UR-9 A-FLAG SHIBUYA 2013/12/19 6,370 4.8% - - - 4.7% 4.5% 4.4% 4.3% 4.2% 4.1% 4.0% 4.0% 4.0% 4.0% UR-10 Q plaza SHINSAIBASHI 2015/12/16 13,350 3.9% ------3.9% 3.8% 3.7% 3.6% 3.6% 3.6% UR-11 A-FLAG KOTTO DORI 2016/12/20 4,370 3.8% ------3.6% 3.5% 3.5% 3.5% UR-12 A-FLAG BIJUTSUKAN DORI 2016/12/2 4,700 3.8% ------3.6% 3.6% 3.6% 3.6% UR-13 A-FLAG DAIKANYAMA WEST 2017/1/6 2,280 4.1% ------4.0% 3.9% 3.9% 3.9% UR-14 A-FLAG KITA SHINSAIBASHI 2017/12/1 4,725 4.0% ------4.0% 3.9% UR-15 DECKS Tokyo Beach (Note 2) 2018/1/5 12,740 4.0% ------4.0% 4.0% TO-1 TLC Ebisu Building 2012/6/13 7,400 4.7% 4.7% 4.6% 4.6% 4.5% 4.3% 4.2% 4.1% 4.1% 4.0% 3.9% 3.8% 3.7% 3.6% TO-2 A-PLACE Ebisu Minami 2012/6/13 9,640 4.6% 4.6% 4.5% 4.5% 4.4% 4.2% 4.1% 4.0% 4.0% 3.9% 3.8% 3.7% 3.6% 3.5% TO-3 A-PLACE Yoyogi 2012/6/13 4,070 4.6% 4.6% 4.5% 4.6% 4.5% 4.5% 4.4% 4.3% 4.2% 4.1% 4.0% 3.9% 3.9% 3.9% TO-4 A-PLACE Aoyama 2012/6/13 8,790 4.9% 4.9% 4.9% 4.8% 4.7% 4.6% 4.5% 4.4% 4.3% 4.2% 4.1% 4.0% 4.0% 4.0% TO-5 Luogo Shiodome 2012/6/13 4,540 4.5% 4.5% 4.5% 4.4% 4.3% 4.2% 4.1% 4.0% 3.9% 3.8% 3.7% 3.6% 3.6% 3.6% TO-6 TAMACHI SQUARE (Land)(Note3) 2012/6/13 2,338 4.4% - - - 4.4% 4.3% 4.2% 4.1% 4.0% 3.9% 3.8% 3.7% 3.7% 3.6% TO-7 A-PLACE Ikebukuro 2012/6/13 3,990 5.1% 5.1% 5.0% 4.9% 4.9% 4.8% 4.6% 4.5% 4.5% 4.4% 4.3% 4.3% 4.2% 4.1% TO-8 A-PLACE Shinbashi 2013/4/19 5,650 4.7% - 4.6% 4.5% 4.4% 4.3% 4.2% 4.1% 4.1% 4.0% 3.9% 3.9% 3.9% 3.8% TO-9 A-PLACE Gotanda 2014/1/10 5,730 4.4% - - - 4.3% 4.3% 4.2% 4.1% 4.0% 3.9% 3.8% 3.7% 3.7% 3.7% TO-10 A-PLACE Shinagawa 2014/1/10 3,800 4.4% - - - 4.3% 4.2% 4.1% 4.0% 4.0% 3.9% 3.8% 3.8% 3.7% 3.6% TO-11 OSAKI WIZTOWER 2014/6/24 10,690 4.3% - - - - 4.2% 4.1% 3.9% 3.8% 3.7% 3.6% 3.5% 3.5% 3.5% 2015/1/9 30,300 3.9% - - - - - 3.8% 3.8% 3.7% 3.6% TO-12 Shiodome Building (Note 4) 2015/12/16 20,400 3.8% ------3.5% 3.5% 3.4% 3.4% 2016/12/2 20,900 3.6% ------TO-13 A-PLACE Ebisu Higashi 2015/7/29 7,072 4.1% ------4.0% 4.0% 3.9% 3.8% 3.7% 3.7% 3.7% TO-14 A-PLACE Shibuya Konnoh 2015/10/1 4,810 4.0% ------4.0% 3.9% 3.8% 3.7% 3.6% 3.6% 3.6% TO-15 A-PLACE Gotanda Ekimae 2016/7/1 7,280 4.1% ------4.0% 3.9% 3.8% 3.8% 3.8% TO-16 A-PLACE Shinagawa Higashi 2017/3/16 18,800 4.0% ------4.0% 3.9% 3.9% 3.9% TO-17 A-PLACE Shinbashi Ekimae (Note 5) 2012/6/13 20,500 4.9% 4.9% 4.9% 4.8% 4.8% 4.7% 4.6% 4.5% 4.5% 4.4% 4.4% 3.6% 3.6% 3.6% AA-１ Amagasaki Q's MALL (Land) 2012/6/13 12,000 5.0% 5.0% 5.0% 4.9% 4.8% 4.8% 4.8% 4.7% 4.6% 4.5% 4.4% 4.3% 4.3% 4.3% AA-２ icot Nakamozu 2012/6/13 8,500 6.0% 6.0% 5.9% 5.8% 5.6% 5.5% 5.4% 5.3% 5.3% 5.2% 5.2% 5.2% 5.1% 5.0% AA-４ icot Mizonokuchi 2012/6/13 2,710 6.0% 6.0% 6.0% 5.9% 5.8% 5.8% 5.7% 5.6% 5.5% 5.4% 5.4% 5.4% 5.4% 5.5% AA-５ icot Tama Center 2012/6/13 2,840 6.2% 6.2% 6.2% 6.1% 6.0% 5.9% 5.8% 5.7% 5.6% 5.4% 5.3% 5.2% 5.1% 5.1% AA-６ A-PLACE Kanayama 2012/6/13 6,980 5.3% 5.3% 5.2% 5.4% 5.4% 5.4% 5.4% 5.3% 5.2% 5.1% 5.1% 5.1% 5.1% 5.1% Osaka Nakanoshima 2013/1/25 5,250 5.0% - 5.0% 5.0% 4.9% 4.8% AA-７ 4.6% 4.5% 4.5% 4.4% 4.3% 4.2% 4.1% 4.0% Building (Note 6) 2014/12/19 5,850 4.8% - - - - - AA-８ icot Omori 2013/12/19 5,790 5.1% - - - 5.0% 4.9% 4.8% 4.7% 4.7% 4.7% 4.6% 4.5% 4.4% 4.4% AA-９ Market Square Sagamihara 2015/1/9 4,820 5.6% - - - - - 5.5% 5.4% 5.4% 5.3% 5.3% 5.3% 5.3% 5.3% AA-10 Umeda Gate Tower 2016/9/21 19,000 4.0% ------3.9% 3.8% 3.7% 3.7% 3.7% AA-11 A-PLACE Bashamichi 2016/10/6 3,930 5.1% ------5.0% 4.9% 4.9% 4.9% 4.9% AA-12 Commercial Mall Hakata 2018/1/5 6,100 4.8% ------4.8% 4.8% (Note 1) Calculated based on direct capitalization method. (Note 2) Tokyu Plaza Omotesando Harajuku, Tokyu Plaza Akasaka and DECKS Tokyo Beach are calculated based on the pro rata share of the co-ownership interests (75%, 50% and 49%, respectively). (Note 3) The acquisition price for TAMACHI SQUARE (Land) represents the acquisition price of the land as of the acquisition date (June 13, 2012). (Note 4) Regarding Shiodome Building, the first row, the second row, and the third row represent the figures for the stake acquired on January 9, 2015, December 16, 2015 and December 2, 2016 (co-ownership of 15%, 10% and 10%, respectively). (Note 5) Asset category and property name changed on June 1, 2018 from UR and Shinbashi Place, respectively. (Note 6) Regarding Osaka Nakanoshima Building, the first row represents the figures for the stake acquired on January 25, 2013 and the second row represents the figures for the stake acquired on December 19, 2014 (co-ownership of 50% each). 6. Appendix Portfolio Appraisal Values Status/PML (1/2) 39
42 properties (as of Nov. 30, 2018 (the end of 14th Period)) (in millions of yen)
Capitalization value Appraisal Acquisition Investment Appraisal Direct Discounted Terminal PML Category Property # Property name agency Capitalization Discount rate price ratio (%) value capiralization cash flow capitalization NOI (Note 2) (%) (Note 1) rate (%) (%) method method rate (%) UR-1 Tokyu Plaza Omotesando Harajuku 45,000 9.0% J 61,200 61,950 2.7% 60,375 2.4% 2.8% 1,668 2.9 (Note 3) UR-2 Tokyu Plaza Akasaka 11,450 2.3% T 15,500 15,700 4.0% 15,400 4.1% 4.2% 725 3.6 (Note 3)(Note 4) UR-3 Q plaza EBISU (Note 5) 8,430 1.7% T 11,900 12,000 3.2% 11,800 3.4％/3.3％ 3.4% 384 5.7
UR-5 Kyoto Karasuma Parking Building 8,860 1.8% D 11,000 11,100 4.9% 11,000 4.9% 5.1% 555 2.4 UR-6 A-FLAG AKASAKA 3,000 0.6% J 3,750 3,810 3.5% 3,680 3.3% 3.7% 138 6.4
UR-7 Kobe Kyu Kyoryuchi 25Bankan 21,330 4.2% J 26,900 27,300 4.0% 26,500 3.8% 4.2% 1,097 2.6
UR-8 A-FLAG SAPPORO (Note 4) 4,410 0.9% D 7,090 7,090 5.5% 7,090 5.3% 5.7% 463 0.3 UR-9 A-FLAG SHIBUYA 6,370 1.3% D 7,930 7,940 4.0% 7,930 3.8% 4.2% 325 7.9 UR-10 Q plaza SHINSAIBASHI 13,350 2.7% V 14,600 14,500 3.6% 14,600 3.4% 3.8% 523 6.9 UR-11 A-FLAG KOTTO DORI 4,370 0.9% D 4,880 4,940 3.5% 4,850 3.2% 3.6% 180 6.4 UR-12 A-FLAG BIJUTSUKAN DORI 4,700 0.9% J 4,920 5,000 3.6% 4,830 3.4% 3.8% 182 7.5 UR-13 A-FLAG DAIKANYAMA WEST 2,280 0.5% V 2,340 2,390 3.9% 2,290 3.7% 4.1% 88 4.2 UR-14 A-FLAG KITA SHINSAIBASHI 4,725 0.9% V 4,740 4,920 3.9% 4,680 3.6% 4.0% 194 5.4
UR-15 DECKS Tokyo Beach (Note 3) 12,740 2.5% M 12,887 13,083 4.0% 12,642 3.8% 4.2% 566 4.0 TO-1 TLC Ebisu Building 7,400 1.5% T 10,800 11,100 3.6% 10,700 3.7% 3.8% 445 6.5 TO-2 A-PLACE Ebisu Minami 9,640 1.9% T 14,600 14,700 3.5% 14,600 3.6% 3.7% 528 8.0 TO-3 A-PLACE Yoyogi 4,070 0.8% V 4,710 4,790 3.9% 4,630 3.7% 4.1% 191 5.1
TO-4 A-PLACE Aoyama (Note 4) 8,790 1.8% D 10,100 10,100 4.0% 10,100 3.8% 4.2% 422 8.9 TO-5 Luogo Shiodome 4,540 0.9% D 6,220 6,280 3.6% 6,190 3.4% 3.8% 236 2.7
TO-6 TAMACHI SQUARE (Land) 2,338 0.5% T 2,830 2,960 3.6% 2,780 4.0% 3.8% 107 (Note 6)- TO-7 A-PLACE Ikebukuro 3,990 0.8% J 5,120 5,200 4.1% 5,030 3.9% 4.3% 218 3.2 TO-8 A-PLACE Shinbashi 5,650 1.1% J 7,080 7,220 3.8% 6,930 3.6% 4.0% 287 7.4 TO-9 A-PLACE Gotanda 5,730 1.1% M 6,970 7,060 3.7% 6,870 3.5% 3.9% 262 6.1 TO-10 A-PLACE Shinagawa 3,800 0.8% J 4,400 4,480 3.6% 4,320 3.4% 3.8% 166 4.9 TO-11 OSAKI WIZTOWER 10,690 2.1% D 14,600 14,600 3.5% 14,600 3.1% 3.5% 512 2.4
TO-12 Shiodome Building (Note 3) 71,600 14.3% M 75,600 79,450 3.4% 73,850 3.2% 3.6% 2,720 2.6 (Note 1) Abbreviation represents each appraisal agency as follows J：Japan Real Estate Institute, T：The Tanizawa Sōgō Appraisal, D：Daiwa Real Estate Appraisal Corp., V：Japan Valuers, and M：JLL Morii Valuation & Appraisal K.K. (Note 2) Calculated based on Direct capitalization method. The figures are rounded to million yen. (Note 3) Tokyu Plaza Ginza Omotesando, Tokyu Plaza Akasaka, DECKS Tokyo Beach and Shiodome Building are calculated based on the pro rata base share of the respective co-ownership interests (75%, 50%, 49% and 35%, respectively). (Note 4) Seismic strengthening works were conducted at Tokyu Plaza Akasaka, A-FLAG SAPPORO and A-PLACE Aoyama, in Apr. 2009, Jun. 2007 and Jul. 2008, respectively. (Note 5) The discount rate for Q plaza Ebisu is 3.4% from the 1st to the 5th year and 3.3% from the 6th year onwards. (Note 6) Not listed as we own only the land for TAMACHI SQUARE (Land). 6. Appendix Portfolio Appraisal Values Status/PML (2/2) 40
(in millions of yen) Capitalization value Appraisal Acquisition Investment Appraisal Direct Discounted Terminal PML Category Property # Property name agency Capitalization Discount rate price ratio (%) value capiralization cash flow capitalization NOI (Note 2) (%) (Note 1) rate (%) (%) method method rate (%) TO-13 A-PLACE Ebisu Higashi 7,072 1.4% V 7,700 7,870 3.7% 7,530 3.5% 3.9% 295 5.2
TO-14 A-PLACE Shibuya Konnoh 4,810 1.0% V 5,350 5,420 3.6% 5,270 3.3% 3.7% 201 4.3 TO-15 A-PLACE Gotanda Ekimae 7,280 1.5% V 7,690 7,810 3.8% 7,570 3.5% 3.9% 301 7.7
TO-16 A-PLACE Shinagawa Higashi 18,800 3.7% M 19,500 19,700 3.9% 19,200 3.7% 4.1% 787 4.3 TO-17 A-PLACE Shinbashi Ekimae 20,500 4.1% D 20,500 21,100 3.6% 20,300 3.3% 3.7% 755 6.8
AA-１ Amagasaki Q's MALL (Land) 12,000 2.4% J 13,900 14,000 4.3% 13,700 4.0% 4.5% 600 (Note 5)-
AA-２ icot Nakamozu (Note 3) 8,500 1.7% T 10,500 10,700 5.0% 10,400 4.9%/5.0%/5.1% 5.2% 548 4.8
AA-４ icot Mizonokuchi 2,710 0.5% M 3,170 3,240 5.5% 3,100 5.3% 5.9% 182 8.3 AA-５ icot Tama Center 2,840 0.6% J 3,880 3,890 5.1% 3,870 4.7% 5.3% 201 1.8
AA-６ A-PLACE Kanayama 6,980 1.4% V 8,550 8,690 5.1% 8,400 4.9% 5.3% 449 5.3 AA-７ Osaka Nakanoshima Building 11,100 2.2% J 14,300 14,500 4.0% 14,100 3.8% 4.2% 657 7.9 AA-８ icot Omori 5,790 1.2% J 6,870 6,940 4.4% 6,790 4.2% 4.6% 308 3.9 AA-９ Market Square Sagamihara 4,820 1.0% V 5,020 5,040 5.3% 4,990 5.1% 5.5% 264 7.7
AA-10 Umeda Gate Tower 19,000 3.8% D 21,300 21,900 3.7% 21,100 3.4% 3.8% 815 2.4 AA-11 A-PLACE Bashamichi 3,930 0.8% M 4,500 4,600 4.9% 4,400 4.6% 5.1% 251 10.2
AA-12 Commercial Mall Hakata 6,100 1.2% V 6,290 6,310 4.8% 6,270 4.5% 4.9% 306 1.9 Subtotal (existing 42 properties) 431,485 86.0% - 511,687 521,373 - 505,257 - - 20,102 2.3 New assets (as of Jan. 17, 2019)
Capitalization value Appraisal Acquisition Investment Appraisal Direct Discounted Terminal PML Category Property # Property name agency Capitalization Discount rate price ratio (%) value capiralization cash flow capitalization NOI (Note 2) (%) (Note 1) rate (%) (%) method method rate (%)
UR-16 Tokyu Plaza Ginza (Land)(Note 4) 37,500 7.5% M 39,000 38,400 2.6% 39,000 2.5% (Note 6)- 952 (Note 5)-
UR-17 Q plaza HARAJUKU (Note 4) 13,200 2.6% V 13,300 13,500 3.0% 13,100 2.7% 3.1% 405 5.1 AA-13 EDGE SHINSAIBASHI 19,800 3.9% V 20,000 20,200 3.8% 19,800 3.5% 3.9% 798 5.0 Subtotal (New assets) 70,500 14.0% - 72,300 72,100 - 71,900 - - 2,155 -
Total 501,985 100% - 583,987 593,473 - 577,157 - - 22,257 (Note 6)2.2 (Note 1) Abbreviation represents each appraisal agency as follows J：Japan Real Estate Institute, T：The Tanizawa Sōgō Appraisal, D：Daiwa Real Estate Appraisal Corp., V：Japan Valuers, and M：Morii Appraisal & Investment Consulting. (Note 2) Calculated based on Direct capitalization method. The figures are rounded to million yen. (Note 3) The discount rate for icot Nakamozu is 4.9% from 1st to 4th year, 5.0% from 5th to 9th year, and 5.1% from 10th year onwards. (Note 4）Tokyu Plaza Ginza (Land) and Q plaza HARAJUKU are calculated based on the pro rata base share of the respective co-ownership interests (30% and 60%). (Note 5) Not listed as we own only the land for Amagasaki Q’s MALL (Land) and Tokyu Plaza Ginza (Land). (Note 6) Calculation is based on the seismic data derived from the “National Seismic Hazard Maps for Japan” publicized by the Headquarters for Earthquake Research Promotion, Ministry of Education, Culture, Sports, Science and Technologies in Dec. 2012. The figures are rounded to the first decimal place. PML for the entire portfolio is based on the “Report of portfolio seismic PML analysis” as of Oct. 2018. 6. Appendix API Portfolio Matrix (Asset Types × NOI Yield) as of Jan. 17, 2019 41
9.0% 8.8% A-FLAG SAPPORO
8.0% 7.8%
icot 7.0% icot Mizonokuchi 6.8% Kyoto Tama Center A-PLACE Karasuma Tokyu Plaza icot Nakamozu TAMACHI Shinbashi A-PLACE Parking Akasaka Building SQUARE (Land) Bashamichi A-PLACE Osaka 6.0% A-PLACE 5.8% TLC Ebisu Aoyama Nakanoshima A-PLACE Shinbashi A-PLACE A-FLAG KITA Building A-PLACE Building Market Square Ebisu Ekimae Kanayama SHINSAIBASHI Ikebukuro Sagamihara Minami A-PLACE Kobe Kyu Kyoryuchi A-PLACE Yoyogi Shinagawa icot 5.0% Commercial Q plaza A-FLAG SHIBUYA 25Bankan Omori Amagasaki 4.8% OSAKI WIZTOWER Mall Hakata EBISU Q’s MALL (Land) A-FLAG Luogo Shiodome A-FLAG DECKS AKASAKA A-PLACE KOTTO DORI Tokyo Beach A-PLACE A-PLACE Umeda Gate Tower Tokyu Plaza Shibuya 4.0% Q plaza Ebisu Higashi Shinagawa EDGE A-FLAG Omotesando Konnoh A-PLACE 3.8% SHINSAIBASHI Higashi Shinsaibashi BIJUTSUKAN Harajuku Gotanda DORI A-FLAG A-PLACE DAIKANYAMA Shiodome Gotanda WEST Q plaza 3.0% Building Ekimae HARAJUKU 2.8% Tokyu Plaza Ginza (Land)
2.0% 1.8%
Number of Properties：16 Number of Properties：17 Number of Properties：12 Appraisal NOI Yield：4.1% Appraisal NOI Yield：4.5% Appraisal NOI Yield：5.1% Acquisition Price：¥201.7bn Acquisition Price：¥196.7bn Acquisition Price：¥103.6bn
Number of Properties：45, Appraisal NOI Yield：4.5%, Acquisition Price：¥502.0bn 6. Appendix Portfolio Summary (as of Jan 17, 2019) 42
Overall portfolio Urban Retail properties
UR and TO 79% Other major Activia cities -5 yrs Other 5-10mins Service Urban 17% Account 2% 20 yrs- 6% major 2% Retail 21% Retail Three cities 40% metropolitan 34% 2% Walking Office 43% areas 5-10 yrs Three 28% 23% major 1-5minsdistance 4% End Category Area Age metropolit from tenant 6 central Area Food Wards of an areas 36% nearest service industry Tokyo other wards of 24% 11% Tokyo 6 central station Tokyo Office than 6 2% 68% wards of -1min 39% 10-20yrs Tokyo Hotel Other 37% 62% 74% 14% 11%
Portfolio average 17.3 yrs
Tokyo Office properties Activia Account properties Electricity, Real gas, etc. estate 4% Other 7% Wards of Other wards -1min 10mins- than 6 5-10mins 1% Tokyo Retail 13% -1min 2% 14% Other other 15% Service major 21% Finance, 41% than 6 31% cities 6% 5- Walking insurance Walking 8% End 6% 10mins distance distance tenant 8% Area from Category Area from industry nearest nearest Transportation, station telecom Three major train 15% metropolitan station 1- 6 central Manufacturing Office wards 1-5mins areas 5mins Wholesale, 19% 59% 98% 71% retail, food 88% 58% service 15%
(Note 1) Calculated based on the 45 properties including Tokyu Plaza Ginza (Land), Q plaza HARAJUKU and EDGE Shinsaibashi acquired on Jan. 10, 2019. (Note 2) “6 central wards of Tokyo” refers to Shibuya ward, Minato ward, Chuo ward, Chiyoda ward, Shinjuku ward and Shinagawa ward. (Note 3) Average of property age is calculated excluding the properties API owns only land. (Note 4) Industrial distribution is based on annual rents as of Nov. 30, 2018. 6. Appendix Balance Sheets ~the Period Ended Nov. 2018 (the 14th Period)~ 43
(in thousands of yen) 13th Period 14th Period 13th Period 14th Period ended May 2018 ended Nov. 2018 ended May 2018 ended Nov. 2018 Assets Liabilities Current assets Current liabilities Cash and deposits 9,498,104 10,023,157 Operating accounts payable 846,139 913,616 Cash and deposits in trust 3,116,967 3,067,204 Short-term borrowings 9,100,000 9,100,000 Operating accounts receivable 645,833 848,825 Investment corporation bonds due within a year 4,000,000 4,000,000 Prepaid expenses 455,470 294,817 Long-term borrowings to be repaid within a year 18,500,000 19,600,000 Consumption taxes receivable 47,699 - Accounts payable-other 234,813 73,949 Other 6,514 3,066 Accrued expenses 809,070 902,125 Total current assets 13,770,589 14,237,072 Income taxes payable 708 976 Non-current assets Accrued consumption taxes - 457,386 Property, plant and equipement Advances received 314,273 428,888 Buildings in trust 83,050,493 83,354,620 Deposits received 4,755 566 Accumulated depreciation (9,675,982) (10,879,394) Total current liabilities 33,809,761 35,477,509 Buildings in trust, net 73,374,511 72,475,226 Non-current liabilities Structures in trust 689,748 696,585 Investment corporation bonds 14,000,000 14,000,000 Accumulated depreciation (150,438) (168,417) Long-term borrowings payable 153,750,000 152,650,000 Structures in trust, net 539,310 528,167 Tenant leasehold and security deposits in trust 20,604,450 19,494,916 Machinery and equipement in trust 1,364,809 1,390,538 Other 6 2 Accumulated depreciation (300,583) (330,343) Total non-current liabilities 188,354,456 186,144,918 Machinery and equipement in trust, net 1,064,225 1,060,195 Total liabilities 222,164,217 221,622,427 Tools, furniture and fixtures in trust 183,401 193,307 Accumulated depreciation (82,287) (98,107) Net assets Tools, furniture and fixtures in trust, 101,113 95,200 Unitholders' equity Land in trust 346,689,270 346,689,270 Unitholders' capital 217,091,520 217,091,520 Construction in progress in trust - 6,708 Surplus Total property, pland and equipement 421,768,431 420,854,767 Unappropriated retained earnings (undisposed loss) 6,611,254 6,696,690 Intangible assets Total surplus 6,611,254 6,696,690 Leasehold rights in trust 9,130,097 9,130,097 Total unitholders' equity 223,702,774 223,788,210 Other 2,575 2,118 Valuation, translation, adjustments and others Total intangible assets 9,132,673 9,132,216 Deffered gains or losses on hedges 74,904 54,245 Investments and other assets Total valuation, translation, adjustments and others 74,904 54,245 Long-term prepaid expenses 1,078,965 1,080,595 Total net assets 223,777,679 223,842,455 Derivatives 74,904 54,245 Total liabilities and net assets 445,941,897 445,464,883 Deffered tax assets 5 18 Other 38,742 38,322 Total investments and other assets 1,192,618 1,173,181 Total non-current assets 432,093,723 431,160,166 Deferred assets Investment corporation bond issuance costs 77,584 67,645 Total deferred assets 77,584 67,645 Total assets 445,941,897 445,464,883 6. Appendix Statement of Income ~the Period Ended Nov. 2018 (the 14th Period)~ 44
(in thousands of yen) Period ended May 2018 Period ended Nov. 2018 (the 13th Period) (the 14th Period) Operating revenue Rent revenue-real estate 12,409,430 12,673,479 Other 917,584 1,141,921 Total operating revenue 13,327,014 13,815,400 Operating expenses Expenses related to rent business 4,706,236 5,076,357 Asset management fee 1,034,028 1,077,918 Asset custody fee 12,427 12,638 Administrative service fee 32,131 32,248 Directors' compensations 3,300 3,300 Other operating expenses 67,522 66,403 Total operating expenses 5,855,645 6,268,867 Operating profit 7,471,369 7,546,533 Non-operating income Interest income 81 55 Interest on securities - - Reversal of distribution payable 908 830 Interest on refund - 409 Insurance income - 149 Total non-operating income 990 1,443 Non-operating expenses Interest expenses 615,512 595,522 Interest expenses on investment corporation bonds 35,235 37,928 Amortization of investment corporation bond issuance costs 9,546 9,938 Investment unit issuance expenses 46,468 54,545 Borrowing related expenses 153,550 151,997 Other 500 500 Total non-operating expenses 860,813 850,432 Ordinary profit 6,611,545 6,697,544 Profit before income taxes 6,611,545 6,697,544 Income taxes-current 721 984 Income taxes-deffered 12 (12) Total income taxes 734 971 Profit before income taxes 6,610,811 6,696,573 Retained earnings brought forward 442 117 Unappropriated retained earnings (undisposed loss) 6,611,254 6,696,690 6. Appendix Occupancy Rate by Property 45 The occupancy rate for the entire portfolio at the end of each period is maintained over 99% since IPO and records 99.9%, a persistently high level of occupancy, at the end of Nov. 2018 (the 14th Period) 2012.11 2013.5 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11 Property # Property name (2nd Period) (3rd Period) (4th Period) (5th Period) (6th Period) (7th Period) (8th Period) (9th Period) (10th Period) (11th Period) (12th Period) (13th Period) (14th Period) UR-1 Tokyu Plaza Omotesando Harajuku 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-2 Tokyu Plaza Akasaka 98.5% 98.7% 98.9% 100.0% 100.0% 98.8% 99.9% 100.0% 100.0% 100.0% 99.7% 100.0% 100.0% UR-3 Q plaza EBISU 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-4 Shinbashi Place 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%- UR-5 Kyoto Karasuma Parking 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-6 A-FLAG AKASAKA - - 84.2% 84.2% 100.0% 100.0% 100.0% 100.0% 74.1% 90.0% 100.0% 100.0% 100.0% UR-7 Kobe Kyu Kyoryuchi 25Bankan - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-8 A-FLAG SAPPORO - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-9 A-FLAG SHIBUYA - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% UR-10 Q plaza SHINSAIBASHI ------88.4% 100.0% 100.0% 100.0% 88.4% 100.0% UR-11 A-FLAG KOTTO DORI ------100.0% 100.0% 100.0% 100.0% UR-12 A-FLAG BIJUTSUKAN DORI ------100.0% 100.0% 100.0% 100.0% UR-13 A-FLAG DAIKANYAMA WEST ------100.0% 100.0% 100.0% 100.0% UR-14 A-FLAG KITA SHINSAIBASHI ------100.0% 100.0% UR-15 DECKS Tokyo Beach ------100.0% 99.7% Urban Retail properties average 99.5% 99.6% 99.1% 99.6% 100.0% 99.8% 100.0% 99.7% 99.4% 99.8% 100.0% 99.7% 100.0% TO-1 TLC Ebisu Building 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 87.5% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-2 A-PLACE Ebisu Minami 100.0% 96.1% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-3 A-PLACE Yoyogi 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 88.9% 100.0% 100.0% 100.0% 100.0% TO-4 A-PLACE Aoyama 86.7% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-5 Luogo Shiodome 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-6 TAMACHI SQUARE (Land) 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-7 A-PLACE Ikebukuro 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-8 A-PLACE Shinbashi - 84.6% 88.4% 100.0% 100.0% 98.7% 97.8% 100.0% 100.0% 100.0% 100.0% 100.0% 98.7% TO-9 A-PLACE Gotanda - - - 100.0% 100.0% 100.0% 100.0% 100.0% 89.3% 100.0% 100.0% 100.0% 100.0% TO-10 A-PLACE Shinagawa - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-11 OSAKI WIZTOWER - - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-12 Shiodome Building - - - - - 98.2% 93.2% 98.2% 99.4% 99.9% 99.7% 99.9% 100.0% TO-13 A-PLACE Ebisu Higashi ------100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-14 A-PLACE Shibuya Konnoh ------100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% TO-15 A-PLACE Gotanda Ekimae ------100.0% 100.0% 100.0% 100.0% 100.0% TO-16 A-PLACE Shinagawa Higashi ------100.0% 100.0% 100.0% 100.0% TO-17 A-PLACE Shinbashi Ekimae (Note 2) ------100.0% Tokyo Office properties average 97.4% 97.5% 98.6% 100.0% 100.0% 99.6% 97.5% 99.6% 98.9% 100.0% 99.9% 100.0% 99.9% AA-1 Amagasaki Q's MALL (Land) 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-2 icot Nakamozu 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-4 icot Mizonokuchi 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-5 icot Tama Center 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-6 A-PLACE Kanayama 100.0% 100.0% 98.6% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-7 Osaka Nakanoshima Building - 99.6% 100.0% 97.3% 98.2% 97.9% 97.9% 100.0% 100.0% 96.9% 100.0% 98.4% 100.0% AA-8 icot Omori - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-9 Market Square Sagamihara - - - - - 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% AA-10 Umeda Gate Tower ------93.6% 100.0% 100.0% 100.0% 100.0% AA-11 A-PLACE Bashamichi ------99.1% 100.0% 100.0% 100.0% 100.0% AA-12 Commercial Mall Hakata ------97.0% 97.0% Activia Account properties average 100.0% 100.0% 99.9% 99.8% 99.8% 99.7% 99.7% 100.0% 99.4% 99.6% 100.0% 99.6% 99.8% Total average occupancy rate 99.4% 99.4% 99.4% 99.8% 99.9% 99.7% 99.2% 99.8% 99.3% 99.8% 100.0% 99.8% 99.9% (Note 1) The occupancy rate refers to the share of the leased area to the total leasable area of each property at the end of month. The figures are rounded to the first decimal place. (Note 2) Asset category and property name changed as of June 1, 2018 from UR and Shinbashi Place, respectively. 6. Appendix 10 Largest Tenants / Average Monthly Rents for TO Properties / Contract Period & Remaining Years 46
1. 10 largest tenants by leased area (Note 1) 2. Average monthly rents for Tokyo Office Properties (incl. common service fee) Total Ratio of Tokyo Office properties leased Lease Tokyo Office properties leased (at IPO) (Note) End-tenant Property name area area expiration (Note 4) Nov. 2013 (㎡) (%) ¥19,338 ¥19,556 (Note 2) 4th Period May 2014 ¥19,813 ¥19,400 Tokyu Plaza Akasaka 5th Period (+2.5%) （-0.8%） 1. Tokyu Hotels Co., Ltd. (Note 3) 30,183 7.3 2021.10 A-FLAG SAPPORO Nov. 2014 ¥19,230 ¥19,270 6th Period （-2.9%） （-0.7%） Tokyu Plaza Ginza May 2015 ¥22,242 ¥19,548 (Land)(Note3) 7th Period 2089.1 (+15.7%) （+1.4%） 2. Sumitomo Mitsui TAMACHI SQUARE 29,883 7.2 2074.5 Nov. 2015 ¥22,127 ¥19,995 Trust Bank, Limited (Land) 2042.1 8th Period （-0.5%） （+2.3%） Amagasaki Q’s MALL (Land) May 2016 ¥23,358 ¥20,406 9th Period (+5.6%) （+2.1%） 3. Kohnan Shoji Co., Ltd. icot Nakamozu 26,529 6.4 2027.7 Nov. 2016 ¥23,441 ¥20,748 10th Period （+0.4%） （+1.7%） Kyoto Karasuma May 2017 ¥23,323 ¥21,253 4. Times24 Co., Ltd. Parking 21,224 5.1 - 11th Period (-0.5%) （+2.4%） Building Nov. 2017 ¥23,510 ¥21,681 Kobe Kyu Kyoryuchi 12th Period (+0.8%) （+2.0%） 5. Plan・Do・See Inc. 14,195 3.4 - 25Bankan May 2018 ¥23,761 ¥21,870 13th Period (+1.1%) （+0.9%） 6. Room’s-Taishodo icot Mizonokuchi 14,032 3.4 2023.7 Nov. 2018 ¥24,420 ¥21,981 14th Period (+2.8%) （+0.5%） (Note) “Tokyo Office properties (at IPO)” refers to 6 properties: TLC Ebisu Building, A-PLACE Ebisu- 7. K’S HOLDINGS Market Square 11,864 2.9 2034.6 Minami, A-PLACE Yoyogi, A-PLACE Aoyama, Luogo Shiodome and A-PLACE Ikebukuro CORPORATION Sagamihara 3. Contract period and remaining contract period Shiodome Building 8. NTT Communications 10,337 2.5 - (Note 3) Urban Tokyo Activia Total Retail Office Account 9. YANMAR Co., Ltd. Umeda Gate Tower 7,871 1.9 - Contract Period (Year) 16.0(9.3) 4.3(3.6) 9.8(7.2) 10.1(6.5) A-PLACE Shinagawa 10. Swing Corporation 6,101 1.5 2020.4 Higashi Remaining Contract 12.1(4.9) 2.7(2.1) 6.1(3.9) 7.1(3.5) Period (Year) (Note 1) Based on the lease agreements as of Nov. 30, 2018 of 45 properties including Tokyu Plaza Ginza (Land), Q plaza HARAJUKU and EDGE Shinsaibashi, except for Tokyu Plaza Ginza (Land) which is based on lease (Note 1) The figures in the parenthesis are excluding those of Tokyu Plaza Ginza (Land), TAMACHI agreement as of Jan. 10, 2019. (Note 2) The percentage of area for each end-tenant is the ratio to the total leased area of API’s portfolio, SQUARE (Land) and Amagasaki Q’s MALL (Land). rounded to the first decimal place. (Note 2) Based on the lease agreements as of Nov. 30, 2018 of 45 properties including Tokyu Plaza Ginza (Land), (Note 3) Tokyu Plaza Akasaka, Tokyu Plaza Ginza (Land) and Shiodome Buidling are calculated based on the pro- Q plaza HARAJUKU and EDGE Shinsaibashi, except for Tokyu Plaza Ginza (Land) which is based on lease rata share of the co-ownership interests (50%, 30% and 35%, respectively). agreement as of Jan. 10, 2019. (Note 4) “-” denotes that the data is not disclosed due to no consent from tenants. (Note 3) The figures are based on rents. 6. Appendix Overview of Lease, Profit and Loss for the Period Ended Nov. 2018 (the 14th Period) (1/3) 47
(in thousands of yen)
Urban Retail properties
Tokyu Plaza Kyoto Tokyu Plaza Kobe Kyu A-FLAG A-FLAG A-FLAG A-FLAG DECKS Tokyo Omotesando Q plaza Karasuma A-FLAG A-FLAG A-FLAG Q plaza Akasaka Kyoryuchi KOTTO BIJUTSUKAN DAIKANYAMA KITA Beach Harajuku EBISU Parking AKASAKA SAPPORO SHIBUYA SHINSAIBASHI (Note1) 25Bankan DORI DORI WEST SHINSAIBASHI (Note1) (Note1) Building
①Revenues related to rent 1,101,047 656,253 275,165 (Note2) 107,851 744,420 677,651 212,075 345,331 121,961 138,673 (Note2) 110,223 634,257 business
Rent revenue- 1,042,366 555,117 240,238 (Note2) 82,542 661,670 598,387 203,514 327,406 115,831 111,075 (Note2) 99,584 496,049 real estate
Other lease business 58,680 101,136 34,926 (Note2) 25,309 82,750 79,263 8,560 17,924 6,129 27,597 (Note2) 10,639 138,208 revenue
②Expense related to rent business 245,679 261,684 64,772 39,396 36,348 208,941 256,345 86,639 49,119 37,848 57,242 29,548 25,565 270,485
Management operation 88,301 82,621 17,143 3,737 11,277 77,767 121,267 40,488 10,025 13,294 16,379 12,101 5,639 106,462 expenses
Utilities expenses 33,069 77,988 28,909 - 13,679 65,090 71,542 6,238 14,867 6,789 8,975 300 10,350 116,524
Tax and public 59,080 68,897 8,671 33,643 7,643 46,634 24,363 11,057 14,347 13,088 2,190 12,842 5,969 15 dues
Insurance 191 412 75 159 36 619 476 53 64 73 36 58 70 607
Repair and maintenance 6,579 23,385 131 814 2,109 13,740 25,357 23,468 3,787 2,588 10,912 1,525 2,121 5,165 expenses
Other expenses 58,457 8,377 9,841 1,040 1,603 5,089 13,338 5,333 6,027 2,015 18,748 2,719 1,413 41,709 related to rent
③NOI 855,367 394,569 210,392 (Note2) 71,503 535,478 421,305 125,435 296,211 84,112 81,430 (Note2) 84,658 363,772 (①－②)
④Depreciation and other (Note 4) 51,014 38,998 18,264 15,810 8,066 120,626 64,841 7,838 15,794 4,909 6,574 2,684 4,628 21,789
Income (loss) from rent 804,352 355,571 192,127 (Note2) 63,436 414,852 356,463 117,596 280,417 79,203 74,856 (Note2) 80,030 341,982 business (③-④)
(Note 1) Tokyu Plaza Harajuku, Tokyu Plaza Akasaka and DECKS Tokyo Beach are calculated based on the pro-rata share of the co-ownership interests (75%, 50% and 49%, respectively). (Note 2) Undisclosed due to no consent from tenants. (Note 3) Loss on retirement of current assets is included. 6. Appendix Overview of Lease, Profit and Loss for the Period Ended Nov. 2018 (the 14th Period) (2/3) 48
(in thousands of yen)
Tokyo Office properties
A-PLACE A-PLACE Tamachi Shiodome A-PLACE A-PLACE A-PLACE A-PLACE TLC Ebisu A-PLACE A-PLACE Luogo A-PLACE A-PLACE A-PLACE A-PLACE OSAKI Shinbashi Ebisu Square Building Ebisu Shibuya Gotanda Shinagawa Building Yoyogi Aoyama Shiodome Ikebukuro Shinbashi Gotanda Shinagawa WIZTOWER Ekimae Minami (Land) (Note1) Higashi Konnoh Ekimae Higashi (Note2)
①Revenues related 324,751 373,973 129,208 303,637 181,904 62,502 (Note3) 199,410 180,660 116,430 349,446 1,534,740 175,164 115,557 179,102 509,697 381,874 to rent business
Rent revenue- 299,450 355,826 120,835 283,251 167,916 62,502 (Note3) 184,740 167,660 109,035 325,455 1,447,964 165,077 109,595 168,117 464,032 371,823 real estate
Other lease business 25,301 18,147 8,372 20,385 13,988 - (Note3) 14,670 12,999 7,395 23,990 86,775 10,087 5,962 10,985 45,664 10,050 revenue
②Expense related to 84,779 88,646 38,327 69,509 52,983 8,968 33,943 53,102 41,676 33,898 98,867 380,446 43,974 30,461 59,707 137,867 82,181 rent business
Management operation 25,888 27,471 12,554 19,156 12,411 - 10,308 16,524 12,890 9,292 57,640 105,630 12,643 11,678 17,653 45,873 19,024 expenses
Utilities 22,504 23,816 9,442 20,996 14,338 - 10,438 14,076 11,670 6,802 17,477 98,613 9,563 6,598 12,656 38,941 14,793 expenses
Tax and public 16,872 31,058 10,253 21,795 18,296 8,700 10,494 15,310 14,107 10,813 21,821 115,146 13,831 9,469 18,076 47,079 34,311 dues
Insurance 193 247 83 181 158 - 84 132 106 71 304 916 100 76 116 463 155
Repair and maintenance 10,260 2,034 1,037 3,276 5,284 - 818 1,947 1,251 4,462 - 34,504 5,949 345 4,453 2,206 6,403 expenses
Other expenses 9,060 4,018 4,955 4,102 2,494 267 1,799 5,110 1,649 2,456 1,623 25,633 1,887 2,293 6,750 3,303 7,492 related to rent
③NOI 239,971 285,327 90,880 234,127 128,921 53,533 (Note3) 146,308 138,984 82,532 250,579 1,154,293 131,189 85,096 119,394 371,830 299,692 (①－②)
④Depreciation and 41,594 33,332 15,429 23,751 27,176 - 20,685 21,100 26,844 8,697 48,275 148,280 23,609 12,906 12,292 30,245 52,170 other (Note 4)
Income (loss) from rent business (③- 198,377 251,994 75,451 210,376 101,745 53,533 (Note3) 125,207 112,139 73,834 202,303 1,006,013 107,579 72,189 107,101 341,585 247,521 ④) (Note 1) Shiodome Building is calculated based on the pro-rata share of the co-ownership interest (35%). (Note 2) Property name and asset category were changed as such as of Jun. 1, 2018 following replacement of tenants. (Note 3) Undisclosed due to no consent from tenants. (Note 4) Loss on retirement of current assets is included. 6. Appendix Overview of Lease, Profit and Loss for the Period Ended Nov. 2018 (the 14th Period) (3/3) 49
(in thousands of yen) (in thousands of yen)
Activia Account properties
Amagasaki icot Osaka Market icot icot A-PLACE icot Umeda Gate A-PLACE Commercial Q's MALL Tama Nakanoshima Square Nakamozu Mizonokuchi Kanayama Omori Tower Bashamichi Mall Hakata (Land) Center Building Sagamihara
①Revenues related 356,759 311,402 (Note1) 147,018 292,745 535,622 239,961 (Note1) 444,714 191,089 222,272 to rent business
Rent revenue-real 356,759 310,545 (Note1) 135,589 264,023 502,820 202,377 (Note1) 407,845 169,053 174,895 estate Other lease business - 856 (Note1) 11,428 28,721 32,802 37,584 (Note1) 36,868 22,036 47,377 revenue
②Expense related 56,402 41,663 14,219 45,971 90,294 195,076 65,863 36,437 107,696 81,698 64,898 to rent business
Management operation - 5,682 3,261 18,524 25,257 56,636 11,248 16,059 36,554 19,085 20,814 expenses
Utilities - 30 - 13,891 25,613 48,275 32,425 5,551 31,457 24,186 33,362 expenses
Tax and 56,134 30,423 10,074 11,753 25,802 50,768 12,515 13,841 34,135 16,814 - public dues
Insurance - 235 100 145 252 749 94 132 365 293 174
Repair and maintenance - 2,801 - 452 10,530 29,589 8,370 - 2,208 18,420 3,034 expenses Other expenses 267 2,491 783 1,205 2,838 9,058 1,209 851 2,974 2,896 7,513 related to rent ③NOI 300,356 269,738 (Note1) 101,046 202,450 340,545 174,098 (Note1) 337,018 109,391 157,373 (①－②)
④Depreciation and - 34,625 8,440 18,944 51,749 71,045 17,500 23,941 68,924 29,031 14,734 other (Note 23)
Income (loss) from rent 300,356 235,113 (Note1) 82,102 150,701 269,500 156,598 (Note1) 268,094 80,359 142,638 business (③-④) (Note 1) Undisclosed due to no consent from tenants. (Note 2) Loss on retirement of current assets is included. 6. Appendix Financial Highlights 50
Nov. 2013 May 2014 Nov. 2014 May 2015 Nov. 2015 May 2016 Nov. 2016 May 2017 Nov. 2017 May 2018 Nov. 2018 May 2019 Nov. 2019 (4th (5th (6th (7th (8th (9th (10th (11th (12th (13th (14th (15th Period)(16th Period) (in millions of yen) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) Period) (Forecast) (Forecast) Revenue related to rent business 6,124 7,778 8,174 9,120 9,500 10,175 10,917 12,107 12,720 13,327 13,815 14,432 15,041 Gain on sale of real estate properties - - - - 200 ------338 341 Revenue from leasing business (including gain on sale of 6,124 7,778 8,174 9,120 9,701 10,175 10,917 12,107 12,720 13,327 13,815 14,771 15,383 properties) Expenses related to rent business 1,456 1,889 2,174 2,323 2,494 2,409 2,781 2,922 3,319 3,471 3,809 3,620 4,007 Management operation 425 638 693 825 822 869 917 1,037 1,062 1,225 1,236 1,209 1,224 expenses Utilities expenses 371 524 593 627 658 629 652 682 791 836 1,001 978 1,133 Tax and public dues 433 457 575 578 643 649 772 778 887 895 988 997 1,087 Insurance 5 7 7 8 6 7 7 8 9 8 8 9 9 Repair and maintenance 71 114 142 118 202 78 231 197 304 235 281 132 236 expenses Other expenses related to rent 150 146 161 165 161 175 201 217 264 269 292 292 315 business NOI 4,668 5,889 6,000 6,796 7,006 7,766 8,135 9,185 9,400 9,855 10,006 10,812 11,033 NOI yield(%) 5.10 5.23 4.98 4.93 4.84 4.79 4.73 4.63 4.61 4.61 4.64 - - Depreciation and other 518 743 763 887 928 989 1,051 1,175 1,189 1,234 1,267 1,300 1,309 Income (loss) from rent business 4,149 5,145 5,237 5,909 6,078 6,776 7,083 8,009 8,211 8,620 8,739 9,511 9,724 Loss on sales of real estate properties - 7 ------Net operating income (including loss on sales of real estate 4,149 5,138 5,237 5,909 6,278 6,776 7,083 8,009 8,211 8,620 8,739 9,850 10,066 properties) General and administrative 507 558 643 710 818 849 922 1,029 1,136 1,149 1,192 1,268 1,393 expenses Operating profit 3,642 4,580 4,594 5,199 5,460 5,926 6,161 6,980 7,074 7,471 7,546 8,582 8,672 Non-operating income 4 2 5 3 5 8 3 3 1 0 1 0 0 Non-operating expenses 459 584 567 619 674 737 754 830 858 860 850 963 1,032 Ordinary profit 3,187 3,998 4,032 4,583 4,790 5,197 5,410 6,152 6,218 6,611 6,697 7,619 7,640 Net profit 3,186 3,997 4,031 4,582 4,789 5,196 5,409 6,151 6,217 6,610 6,696 7,618 7,639 6. Appendix Unit Price Performance and Market Cap since IPO (Jun. 2012) 51
Jan. 11, 2019 Unit price: ¥435,500 TSE REIT index: 1,810pt Market Cap: ¥335.9bn (¥mn)
500,000 (¥) Unit Price 時価総額（右軸） 東証TSE REITREIT指数 投資口価格Market Cap. (left axis) index (right axis） Nov 14, 2016 600,000 Launch of 4th PO Nov 30, 2018 450,000 Nov 26, 2015 Launch of 6th PO Launch of 3rd PO 550,000 400,000 Nov 28, 2017 Launch of 5th PO Nov 27, 2014 500,000 Launch of 2nd PO 350,000
Nov 22, 2013 Launch of 1st PO 300,000 450,000
250,000 400,000
200,000
350,000
150,000
300,000 100,000
Jun.13, 2012 250,000 API: ¥221,750 50,000 TSE REIT index: 906pt Market Cap.: ¥90.6bn
200,000 0 2012年6月 2012年12月 2013年6月 2013年11月 2014年5月 2014年11月 2015年5月 2015年11月 2016年5月 2016年11月 2017年5月 2017年10月 2018年4月 2018年10月 2012.6 2012.11 2013.5 2013.11 2014.5 2014.11 2015.5 2015.11 2016.5 2016.11 2017.5 2017.11 2018.5 2018.11
(Note 1) The performance of TSE REIT index is indexed to API unit price as of June 13, 2012. (Note 2) Adjusted for the 2-for-1 unit split effected as of October 1, 2015. Thus the figures before 7th are shown as half as the actual DPU. 6. Appendix API’s Position in J-REITs 52
AUM Market Cap. （¥mn） （¥mn） 10,000 12,0001,200 No.10 1,000 No.12
10,0001,000 8,000 ¥502.0bn 800 8,000800 （Ave. ¥296.3bn） 6,000600 ¥340.5bn
6,000600 (Ave. ¥212.6bn) 4,000400 4,000400 2,000 2,000200 200
0 0 LTV NAV multiple （%） (fold) 70.0 1.3 44.8% 60.0 1.2 1.04X (Ave. 41.2%) 50.0 (Ave. 0.92x) 1.1 40.0 1.0 30.0 0.9 20.0
10.0 0.8
0.0 0.7 Distribution yield Ratio of unrealized gain （%） （%） 7.0 45.0 4.44% 6.0 40.0 (Ave. 4.82%) 35.0 5.0 19.0% 30.0 (Ave. 15.1%) 4.0 25.0
3.0 20.0 15.0 2.0 10.0 1.0 5.0 0.0 0.0 （Note 1）The data were prepared based on the unit price of each REIT as of Dec. 28, 2018 and its disclosed information as of the same date. (Note 2) Only the data of API is calculated based on the figures from the financial results of the period ended Nov. 30, 2018 or the figures as of Jan. 17, 2019. (Note 3) Figures are calculated based on simple average without using the weighted average. 6. Appendix Macro Data for Real Estate Market 53
1. Vacancy rate by area Source: CBRE Inc. 16%
14% Major 5 Marunouchi, Shibuya, 主要wards5区 of 丸の内・大手町Otemachi 渋谷・恵比寿Ebisu 大阪Osaka 名古屋Nagoya Tokyo 12%
10%
8%
6%
4% Osaka 1.9% Marunouchi, Otemachi 1.6% 2% Nagoya 1.3% Major 5 wards of Tokyo 0.8% 0% Shibuya, Ebisu 0.4%
2. Trends of average rent for 23 wards of Tokyo（Note） (¥) 出所：Source:CBRE CBRE株式会社 Inc. 60,000 Gradeグレード AA グレードGrade A-マイナス グレードGrade BB 50,000
40,000 Grade Ａ ¥37,050 30,000 GradeＡ- ¥25,580 Grade B 20,000 ¥22,100
10,000 2005.3 2005.9 2006.3 2006.9 2007.3 2007.9 2008.3 2008.9 2009.3 2009.9 2010.3 2010.9 2011.3 2011.9 2012.3 2012.9 2013.3 2013.9 2014.3 2014.9 2015.3 2015.9 2016.3 2016.9 2017.3 2017.9 2018.3 2018.9 （Note）Grade A: Office buildings within the 5 central words of Tokyo, with more than 6,500 tsubo of total leasable area, 10,000 tsubo of gross floor area, 500 tsubo of basic floor area and aged less than 11 years. Grade A-: Office buildings within the 23 wards of Tokyo, with more than 4,500 tsubo of total leasable area, 7,000 tsubo of gross floor area, 250 tsubo of basic floor area and complying with the new earthquake resistance standard. Grade B: Office buildings within the 23 wards of Tokyo, having more than 2000 tsubo of basic floor area, between 2,000 and 7,000 tsubo of gross area, and complying with the new earthquake resistance standard. 6. Appendix Supply of Large-scale Office Building in 23 wards of Tokyo 54
New report published in April 2018 has indicated no significant fluctuation from the previous forecast, though FY2022 forecasted for the first time to be 290 thousands ㎡, the lowest level ever （森トラスト㈱調査（Mori Trust actual実績 予想forecast) ） 221
（10 thousand ㎡） 2018-2022 2013-2017 200 Average (forecast) Average (actual) 1.0 million ㎡/year 181 0.9 million ㎡/year 173 162
147 150
126 119 118 118 119 118
99 99 100 100 89 90 92 82 82 76 74 72 64 66 53 50 36 29
0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
（Source) Mori Trust Co., Ltd. （Note）“Large-scale office buildings” refers to office buildings with a total office floor area of 10,000 ㎡ or more. 6. Appendix Activia’s Corporate Philosophy/Basic Policies/Portfolio Composition Policy 55
1. Corporate Philosophy 3. Portfolio Composition Policy
We intend to maintain a competitive portfolio in the medium to long term by investing primarily in Urban Retail properties and Tokyo Office properties upon careful consideration of location as the most important factor, followed by other factors such as size, quality, specifications and suitability for use by tenants.
Urban Retail Properties that are easily 2. Basic Policies recognized and located either near major train stations or popular areas in Tokyo, government-designated Focused investments in Urban Retail and Tokyo Office major cities within Japan’s three Properties major metropolitan areas and other Utilization of the comprehensive support and major cities in Japan capabilities of Tokyu Fudosan Holdings Group’s value 70% or more chain Strong governance structure aimed at maximizing unitholder value Office properties within the 23 wards of Tokyo in areas with a high concentration of offices and located near major train stations In order to maximize unitholder value over the medium to long term, we rigorously select properties which we can expect stable and sustainable demand from retail customers and office tenants, such as properties that are located in areas where large numbers of people gather and To enhance the stability and that serve as a foothold for bustling social and corporate profitability of our portfolio, we activities. We also seek to maximize unitholder value by rigorously select commercial facilities proactively managing our properties and taking other than Urban Retail Properties 30% or less and office building other than Tokyo initiatives to maintain and improve its asset management. Office Properties, assessing the attributes and competitiveness of each property
(Note) The actual split of our portfolio may differ from the above over the short term due to acquisition / disposal of properties 6. Appendix Tokyu Fudosan Holdings Group’s Support System 56
To ensure stable growth over the medium to long term, the Asset Manager has applied its know-how and utilized its independent network to the management of properties. The Asset Manager has also leveraged Tokyu Fudosan Holdings Group companies’ value chain and comprehensive support to ensure asset growth through the continued acquisition of competitive assets (external growth) and operation/management of properties through ways designed to bring out the competitive strengths of properties under management and improve their profitability (internal growth) Utilization of Tokyu Fudosan Holdings Group’s multi-faceted and comprehensive know-how and value chain Tokyu Fudosan Holdings Group One of the major property development groups in Japan with a solid track record in development, operation and management of properties Support for The group also includes B-to-C businesses which may serve as tenants in our External properties and has deep knowledge of consumer needs Growth Value Chain
Sponsor support agreement Development / Property Management
Affiliate support agreements Brokerage Retail Hotels
Tokyu Fudosan Holding
Building Management Sports Facility Group’s Comprehensive Support
Property Development / Property Management management Support for Other agreements Management for Internal Sponsor Management for buildings Growth Support retail facilities Capitalize on the Asset Manager’s own know-how
The management's years of experience in development, operation and management of retail facilities and office buildings - Expand portfolio by leveraging its know-how for property acquisitions and its wide-ranging network - Establish proper operational and management systems tailored to the specific characteristics of the assets of API 6. Appendix REIT Organizational Overview 57
The Sponsor 2 The REIT Custodian Sumitomo Mitsui Trust Bank, Limited 3 6 Transfer Agent General Meeting of Unitholders Sumitomo Mitsui Trust Bank, Limited 1 The Asset Manager General Administrator 4 Board of Directors Sumitomo Mitsui Trust Bank, Executive Director: Kazuyuki Murayama Limited Supervisory Director: Yonosuke Yamada
Administrator for Supervisory Director: Yoshinori Ariga 7 Investment 5 Corporation Bonds MUFG Bank, Ltd. Independent Auditor Sumitomo Mitsui Trust Bank, Support Companies Ernst & Young ShinNihon LLC Limited Tokyu Livable Inc. Tokyu Community Corp. Tokyu Hands Inc. Tokyu Sports Oasis, Inc. Tokyu Stay Co., Ltd.
1 Asset Management Agreement 2 Asset Custody Agreement 3 Transfer Agency Agreement 4 General Administration Agreement 5 Fiscal Agency Agreement 6 Sponsor Support Agreement / Outsourcing Agreement 7 Affiliate Support Agreements 6. Appendix Asset Manager Organizational Overview 58
1. Overview of the Asset Manager 2. Asset Manager Organizational Chart
TLC REIT Management Inc.
Established on Oct. 2009
Capital ¥200 million
Shareholder/Sponsor Tokyu Land Corporation 100%
Hiroyuki Kazushi Sato Tohmata Managing President & Director, CEO Chief Division Officer of Activia Management Division Disclaimer
This document is provided solely for informational purposes and should not be construed as an offer, solicitation or recommendation to buy or sell any specific product including investment units. Any decisions making on investment absolutely rest on your own judgment and on your own responsibility.
This document is not a disclosure document or statement of financial performance required by the Financial Instruments and Exchange Act, the Act Concerning Investment Trusts and Investment Corporations of Japan, the rules governing companies listed on the Tokyo Stock Exchange or any other applicable rules.
This document includes charts and data described by TLC REIT Management Inc. (hereinafter the “Asset Manager”) and refers to data, index and other information provided by third parties in addition to information about Activia Properties Inc. (hereinafter the “Investment Corporation”). Also analyses, judgments and other points of view of the Asset Manager under the present situation are included.
The information contained in this document is not audited and there is no guarantee regarding the accuracy and certainty of the information. Analyses, judgments and other non-factual views of the Asset Manager merely represent views of the Asset Manager as of the preparation date. Different views may exist and the Asset Manager may change its views in the future.
The figures included in this document may be different from the corresponding figures in other disclosure materials due to differences in rounding. Although the information contained in this document is the best available at the time of its publication, no assurances can be given regarding the accuracy, certainty, validity or fairness of this information. The content of this document can be modified or withdrawn without prior notice.
The Investment Corporation and the Asset Manager do not guarantee the accuracy of the data, indexes and other information provided by third parties.
The Investment Corporation’s actual performance may be materially different from results anticipated by forward-looking statements contained in this document.
Dates indicated in this document may not be business days.
Disclaimer for Dutch Investors
The units of the Investment Corporation 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, the Asset Manager has notified the Dutch Authority for the Financial Markets of its intention to offer these units in the Netherlands. The units of the Investment Corporation 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 Asset Manager nor the Investment Corporation is subject to the license requirement pursuant to the Wft. The Asset Manager 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 the Investment Corporation’s home page (https://www.activia-reit.co.jp/en/) to access information provided under Article 23 of the AIFMD.