January 31, 2011 To All Concerned Parties Name of REIT Issuer: Nippon Building Fund, Inc. Sadafumi Abe, Executive Director (TSE Code : 8951) Contact: Asset Management Company Nippon Building Fund Management, Ltd. Koichi Nishiyama, President and CEO Person to Contact: Yasushi Akimoto, General Manager (TEL. +81-3-6259-8681)
Notice of Acquisition of Assets (River City M-SQUARE and 4 Other Properties)
Nippon Building Fund, Inc. (“NBF”) hereby provides notice of its decision on January 11, 2011 to acquire assets as follows:
Description
1. Outline of Acquisition
1) Acquired assets; names of assets; acquisition prices NO. Acquired Name of Assets Acquisition Price Assets （*1） I. Real Property River City M-SQUARE ¥ 13,350,000,000 II. 〃 Nihonbashi Kabuto-cho M-SQUARE ¥ 4,850,000,000 III. 〃 Hakata Gion M-SQUARE ¥ 8,000,000,000 IV. 〃 Gate City Ohsaki (Additional Acquisition) (*2) ¥ 11,650,000,000 V. 〃 Chofu South Gate Bldg. ¥ 9,320,000,000 Total ¥ 47,170,000,000 *1 Miscellaneous acquisition costs, fixed assets tax, city-planning tax and consumption tax etc. are not included in this amount. *2 The sale and purchase price (the total amount of the acquisition price and the reserve for repairs) for the Gate City Ohsaki (additional acquisition) is ¥12 billion. Since the amount of the reserve for repairs as of the anticipated date of transfer is yet to be confirmed, the acquisition price is not fixed at present. Therefore, the anticipated acquisition price for this property is an approximate estimate.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 1 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
2) Sellers; date of contract; dates of transfer Date of Transfer NO. Acquired From (*3) Date of Contract (expected) I. Mitsui Fudosan Co., Ltd. II. February 28, 2011 III. Cool Spring Investment TMK January 11, 2011 IV. Sumitomo Life Insurance Company March 31, 2011 V. Shimizu Corporation April 15, 2011 *3 Please see “4. Outline of Sellers” below for more details.
3) Acquisition funds; broker; payment method NO. Acquisition Funds Broker Payment Method I. II. Funds procured by means of an issue of new Lump-sum III. investment shares, borrowings and existing N/A payment at the IV. capital time of delivery V.
4) Outline of forward commitment etc. It is required that in the event of cancellation of a contract due to a breach by NBF (purchaser) of its contractual obligations, NBF shall pay to the relevant seller a penalty equivalent to 20% of the acquisition price.
2. Points of Acquisition
1) Enhancement of portfolio NBF decided to acquire the abovestated 5 properties (each “the Property”, and collectively “the 5 Properties”) with the intention of enhancing NBF’s portfolio in accordance with the asset management objectives and policies set forth in NBF’s Articles of Incorporation. The 5 Properties are located mainly in the Tokyo CBDs, as well as in the Other Greater Tokyo and the Other Cities, constituting a well-balanced portfolio. As they are relatively new and very competitive properties, the asset management company believes that the 5 Properties will contribute to stable asset management of NBF on a mid- and long-term basis, through the expected enhancement of the size and quality of its portfolio.
2) Utilization of pipelines, etc. Four of the 5 Properties will be acquired from Mitsui Fudosan Co., Ltd., an NBF sponsor, and a fund operated by it, as well as from Sumitomo Life Insurance Company which is also an NBF sponsor. Another Property will be acquired from a company which is not an NBF sponsor but has engaged in business with NBF. NBF intends to continue its policy of making selective investments by exploiting diversified information channels such as the pipelines between NBF and its sponsors, utilizing their property acquisition know-how as well as maximizing NBF’s advantages in size.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 2 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
3. Outline of Assets
I. River City M-SQUARE
1) Valuation of the Property (i) Location The Property is located in the north block of the “Ohkawabata River City 21”, the former site of the Ishikawajima shipbuilding dockyard in Tsukuda, Chuo-ku, acquired and developed by Mitsui Fudosan Co., Ltd. (the seller) and the Japan Housing Corporation (currently the Urban Renaissance Agency, an independent administrative agency). The location is within 2 km of Tokyo Station, has convenient access to “Tsukishima” station of Tokyo Metro Yurakucho-line and Tokyo Subway Ooedo-line, as well as “Hacchobori” station of the Tokyo Metro Hibiya-line and JR Keiyo-line. (ii) Building and Facilities A standard floor of the building has an exclusive area of approximately 660 tsubo (approximately 2,182 m2), a ceiling height of 2,800 – 3,000mm and a 100mm sub-floor cavity for OA connection. The exterior’s color tone is inconspicuous in consideration of the surrounding environment, the comfortable common area has a light court and see-through elevators, which, together with other high-spec functions, make the Property very competitive.
2) Type of Specified Assets Real Property
3) Location (Description in Real Property Registry) Land: 50-ban 75, 85, Tsukuda 2-chome, Chuo-ku, Tokyo Building: 50-banchi 75, 85, Tsukuda 2-chome, Chuo-ku, Tokyo (Street Address) 1-6, Tsukuda 2-chome, Chuo-ku, Tokyo
4) Use (Description in Real Property Registry) Offices, retail stores and parking
5) Type of Ownership (i) Land:100% ownership (ii)Building:100% ownership
6) Square meters (Description in Real Property Registry) (i) Land: site area: 4,808.71 m2 (ii)Building: total floor space: 26,439.03 m2
7) Structure (Description in Real Property Registry) Steel frame and steel framed reinforced concrete structure, flat roof, 8 floors above ground and 1 floor below ground
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 3 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
8) Completion (Description in Real Property Registry) January 15, 2010
9) Design and Construction Design: Sumitomo Mitsui Construction Co., Ltd., 1st Class Registered Architect Office Construction: Sumitomo Mitsui Construction Co., Ltd.
10) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥13,400,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥13,400,000,000 Price based on direct capitalization method ¥12,800,000,000 Net revenue ¥640,852,000 Cap rate 5.0% Price based on DCF method ¥13,700,000,000 Discount rate 4.8% Terminal cap rate 5.2% Integration value ¥14,000,000,000 Percentage for land 50.2% Percentage for building 49.8%
11) Earthquake PML 4.0%(obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
12) Existence of Secured Interests (liens) None.
13) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: ・Total number and summary of lessees: 6 companies (3 general business companies, 2 shops and 1 medical clinic) ・Total rental revenues: ¥1,123 million/year ・Total rentable area: 16,232.43 m2 ・Total leased area: 15,291.97 m2 ・Occupancy Rate: 94.2% ・Total lease deposit amount: ¥1,122 million
14) Miscellaneous With respect to the site of the Property, the seller has conducted research of, and taken countermeasures for, soil pollution in accordance with the “Ordinance Concerning Environment for Ensuring Health and Safety of Tokyo Citizens (Government Ordinance for Environmental
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 4 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
Security)”, and a “Notification of Completion of Measures Preventing Diffusion of Pollution (dated January 30, 2009” to certify the completion of such countermeasures was filed with and accepted by the Tokyo Government. In connection with the current acquisition, NBF has confirmed with Engineering & Risk Services Corporation that the said research and countermeasures have been properly and sufficiently undertaken, and that no need for concern exists with respect to impacts on human health as long as the present use of the land continues.
II. Nihonbashi Kabuto-cho M-SQUARE
1) Valuation of the Property (i) Location The Nihonbashi-Kabutocho area where the Property is located is a traditional financial business area developed since the Meiji era extending outward from the Tokyo Stock Exchange center. It is within walking distance from Tokyo Station, and has convenient access to 4 Metro lines (Tozai, Hibiya, Ginza and Asakusa). (ii) Building and Facilities While in harmony with the surrounding massive architecture represented by the Tokyo Stock Exchange, the building has a novel design utilizing a considerable number of glass curtain walls. It is also highly competitive with high-spec functions such as a standard exclusive floor area of approximately 136 tsubo (approximately 449 m2), a ceiling height of 2,700mm, and a 100mm sub-floor cavity for OA connection etc.
2) Type of Specified Assets Real Property
3) Location (Description in Real Property Registry) Land: 8-ban 5, 8-ban 6, 8-ban 7, 8-ban 8, 8-ban 9, 8-ban 10, Nihonbashi Kabutocho, Chuo-ku, Tokyo Building: 8-banchi 9, 8-banchi 5, 8-banchi 6, 8-banchi 7, 8-banchi 8, 8-banchi 10, Nihonbashi Kabutocho, Chuo-ku, Tokyo (Street Address) 1-4, Nihonbashi Kabutocho, Chuo-ku, Tokyo
4) Use (Description in Real Property Registry) Offices, retail stores and parking
5) Type of Ownership (i) Land:100% ownership (ii) Building:100% ownership
6) Square meters (Description in Real Property Registry) (i) Land: site area: 808.05 m2 (ii)Building: total floor space: 5,053.97 m2
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 5 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
7) Structure (Description in Real Property Registry) Steel frame and steel reinforced concrete structure, flat roof, 8 floors above ground and 1 floor below ground
8) Completion (Description in Real Property Registry) June 15, 2009
9) Design and Construction Design: Sato Kogyo Co. Ltd., 1st Class Registered Architect Office Construction: Sato Kogyo Co. Ltd.
10) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥ 4,850,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥4,850,000,000 Price based on direct capitalization method ¥4,740,000,000 Net revenue ¥217,948,000 Cap rate 4.6% Price based on DCF method ¥4,890,000,000 Discount rate 4.4% Terminal cap rate 4.8% Integration value ¥4,070,000,000 Percentage for land 64.4% Percentage for building 35.6%
11) Earthquake PML 6.4%(obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
12) Existence of Secured Interests (liens) None.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 6 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
13) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: ・Total number and summary of lessees: 2 companies (1 general business company and 1 shop) ・Total rental revenues: not disclosed due to the fact that the lessees’ consent to disclosure has not been obtained. ・Total rentable area:3,297.85 m2 ・Total leased area:3,297.85 m2 ・Occupancy Rate:100.0% ・Total lease deposit amount: not disclosed due to the fact that the lessees’ consent to disclosure has not been obtained.
14) Miscellaneous The seller plans to expand the Property on its adjacent site.
III. Hakata Gion M-SQUARE
1) Valuation of the Property (i) Location The Gion area, the historical and traditional center of Hakata-ku, is within walking distance from JR Hakata Station, the terminal of the Kyushu Shinkansen expected to open in March 2011, and also has excellent access as a business area to the Fukuoka Airport and Tenjin district. The Property is located alongside the Kokutai Road (National Road No. 202), is within 2 minutes walk from “Gion Station” of the Airport-line of Fukuoka Municipal Subway, and the Nishitetsu Bus Stop “Gion-cho” is just in front of the main entrance, contributing to excellent exposure and convenient access to transportation. (ii) Building and Facilities The exterior design of the building is sophisticated and sharp, with glass curtain walls. The standard floor area is approximately 524 tsubo (approximately 1,731 m2) with no pillars, being one of the largest buildings in Kyushu, and able to respond flexibly to various office needs. It is also highly competitive with high-spec functions such a ceiling height of 2,800mm and a 100mm sub-floor cavity for OA connection etc.
2) Type of Specified Assets Real Property
3) Location (Description in Real Property Registry) Land: 63-ban, Reisenmachi, Hakata-ku, Fukuoka City, Fukuoka Prefecture Building: 63-banchi, Reisenmachi, Hakata-ku, Fukuoka City, Fukuoka Prefecture (Street Address) 2-1, Reisenmachi, Hakata-ku, Fukuoka City, Fukuoka Prefecture
4) Use (Description in Real Property Registry) Offices and retail stores
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 7 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
5) Type of Ownership (i) Land:100% ownership (ii)Building:100% ownership
6) Square meters (Description in Real Property Registry) (i) Land: site area: 3,384.06 m2 (ii)Building: total floor space: 18,670.54 m2
7) Structure (Description in Real Property Registry) Steel framed structure, flat roof, 10 floors above ground
8) Completion (Description in Real Property Registry) June 25, 2009
9) Design and Construction Design: Nikken Sekkei Ltd. Construction: Consortium consisting of Kajima Corporation and The Zenitaka Corporation
10) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥ 8,000,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥8,000,000,000 Price based on direct capitalization method ¥8,100,000,000 Net revenue ¥469,768,000 Cap rate 5.8% Price based on DCF method ¥7,950,000,000 Discount rate 5.7% Terminal cap rate 6.0% Integration value ¥7,380,000,000 Percentage for land 35.8% Percentage for building 64.2%
11) Earthquake PML Less than 0.1% (obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
12) Existence of Secured Interests (liens) Provisional registration of establishment of mortgage on the Property exists, which will be extinguished prior to the transfer of the Property at the seller’s responsibility and cost.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 8 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
13) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: ・Total number and summary of lessees: 14 companies (13 general business companies and 1 shop) ・Total rental revenues: ¥734 million/year ・Total rentable area:14,327.64 m2 ・Total leased area:14,327.64 m2 ・Occupancy Rate:100.0% ・Total lease deposit amount: ¥721million
IV. Gate City Ohsaki (Additional Acquisition)
1) Valuation of the Property (i) Location As the Property faces Yamanote Street and directly connects to the “Osaki” station via pedestrian walkways where the JR Yamanote, Saikyo, Shonan-Shinjuku, and Rinkai lines are accessible, it has excellent visibility and convenience of transportation. A redevelopment project is underway in the areas to the west and north of the station, and its potential as a business area has been enhanced due to concentration of businesses. (ii) Building and Facilities The Property is a large-scale, redeveloped complex consisting of the west and east office buildings, commercial facilities mainly containing restaurants, cultural facilities such as rental halls and rental rooms etc., completed in January 1999 as part of a Class One Urban Redevelopment Project in the 2nd district of the Osaki Station East Entrance. It is also highly competitive with high-spec functions such as a standard exclusive floor area between approximately 859 tsubo (approximately 2,840 m2) and 1,236 tsubo (approximately 4,088 m2), a ceiling height of 2,650mm and a 100mm sub-floor cavity for OA connection etc.
2) Type of Specified Assets Real Property
3) Location (Description in Real Property Registry) Land: 500-ban 1, Osaki 1-chome, Shinagawa-ku, Tokyo Building: 500-banchi 1, Osaki 1-chome, Shinagawa-ku, Tokyo (Street Address) 11-1, 2, 6, Osaki 1-chome, Shinagawa-ku, Tokyo
4) Use (primary use listed in Real Property Registry) Offices and retail stores
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 9 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
5) Type of Ownership (i) Land: 5,486,243 / 100,000,000 (approximately 5.49%) of total rights to use land located at 500-ban, 1 (42,476.01 m2) (together with the already owned portion, approximately 17.76% of total rights to use such land, and ownership of land located at 500-ban, 2 (33.30 m2)) (ii) Building: co-ownership interests in condominium interests in the 16th, 17th and 18th floors of the West Tower, as well as the 17th floor of the East Tower, and co-ownership interests in the retail stores section (approximately 6.36%) (the ratio of the exclusively owned area of approximately 5.74% of the offices and stores sections, approximately 18.64% together with the already-owned portion)
6) Square meters (Description in Real Property Registry) (i) Land: site area: 42,509.31 m2 (entire site) (ii)Building: total floor space: 287,349.75 m2（entire business and commercial buildings）
7) Structure (Description in Real Property Registry) Steel framed, Steel reinforced concrete and Steel framed reinforced concrete structure, flat roof, 24 floors above ground and 4 floors below ground
8) Completion (Description in Real Property Registry) January 6, 1999
9) Design and Construction Design: Nikken Sekkei Ltd. Construction: West construction area: consortium consisting of Taisei, Kumagaya, Shimizu, Takenaka, Tokyu and Ando construction companies East construction area: consortium consisting of Kajima, Mitsui, Toda, Maeda Kogyo and Sumitomo construction companies
10) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥ 12,000,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥12,000,000,000 Price based on direct capitalization method ¥12,100,000,000 Net revenue ¥532,635,000 Cap rate 4.4% Price based on DCF method ¥12,000,000,000 Discount rate 4.2% Terminal cap rate 4.6% Integration value ¥11,300,000,000 Percentage for land 73.1% Percentage for building 26.9%
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 10 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
11) Earthquake PML 1.5% (obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
12) Existence of Secured Interests (liens) None.
13) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: (The sole lessee of the Property is Mitsui Fudosan Co., Ltd. Mitsui Fudosan sub-leases the Property to sub-lessees.) (Total of offices and stores sections) Total number and summary of sub-lessees ：65 companies (28 general business companies, 7 financial institutions, 29 stores, 3 clinics, including 2 sub-lessees both in the offices and stores sections) ・Total rental revenues: ¥745 million/year The portion of the office buildings to be acquired by NBF is included in a joint management portion, and NBF will receive rental revenues in proportion to its rights and common area charges in proportion to its equity in the area out of the total rental revenues and common area charges that accrue from such joint management portion. The abovesaid amount is the total rental revenues paid by the lessee (Mitsui Fudosan Co., Ltd.) to NBF after deducting a certain percentage amount from the amount received by the lessee from such sub-lessees. ・Total rentable area:119,212.70 m2 (portion of NBF’s additional acquisition: 9,231.18 m2) ・Total leased area:113,208.89 m2 (portion of NBF’s additional acquisition: 8,762.16 m2) ・Occupancy Rate: 94.9% (provided that, as of November 30, 2010, a termination notice was received from a certain sub-lessee. The total area subject to the termination including the area leased to sub-lessees whose fixed term lease contracts will expire is equivalent to 8.3% of the additionally acquired office and store sections.) ・Total lease deposit amount: ¥9,197million (portion of NBF’s additional acquisition: ¥711 million)
14) Miscellaneous As the land underlying the Property was originally used for factories, a soil investigation was conducted for the purposes of disposition of surplus soil during the construction. As a result of this investigation, it was found that a part of the land did not comply with the reference levels defined under the “Standards for disposal of soil contaminated by heavy metal in connection with acquisition of publicly-owned land (the Tokyo Environment Protection Bureau)” etc., and such soil was appropriately removed and delivered to a repository away from the land. Moreover, NBF has confirmed with Engineering & Risk Services Corporation that, since the land is covered by buildings, asphalt tiles and plants, no threatened impacts on human health are recognized as long as the present management and use of the land continues.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 11 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
V． Chofu South Gate Bldg.
1) Valuation of the Property (i) Location The Property faces the station square of the “Chofu” station of the Keio-line, the second station and is only 15 minutes by limited express train from Shinjuku station, and it has excellent convenience of transportation and visibility. At present, a project around the Chofu station is in progress to relocate tracks underground, and upon completion (expected to be in 2012) the Chofu station will be located underground, and the streets surrounding the station now divided into north and south by the railways will be unified. (ii) Building and Facilities The Property consists of a redeveloped building, construction of which was commenced in February 2006 and completed in October 2007 as a part of a Class One Urban Redevelopment Project in the 1st District South of the Chofu station. It is highly competitive with high-spec functions such as a standard exclusive floor area of approximately 443 tsubo (approximately 1,465 m2), a ceiling height of 2,800mm and a 100mm sub-floor cavity for OA connection etc.
2) Type of Specified Assets Real Property
3) Location (Description in Real Property Registry) Land: 48-ban 26, Kojimacho 2-chome, Chofu city, Tokyo Building: 48-banchi 26, Kojimacho 2-chome, Chofu city, Tokyo (Street Address) 48-26, Kojimacho 2-chome, Chofu city, Tokyo
4) Use (primary use listed in Real Property Registry) Offices
5) Type of Ownership (i) Land: 807,339/1,000,000 (approximately 80.73%) of the total rights to use land located at 48-26 (3,400.82 m2) (ii)Building: condominium interests in the 3rd through 11th floors (equivalent to approximately 84.39% of the exclusively owned area)
6) Square meters (Description in Real Property Registry) (i) Land: site area: 3,400.82. m2 (entire site) (ii)Building: total floor space:22,788.71 m2 (entire building)
7) Structure (Description in Real Property Registry) Steel framed reinforced concrete and Steel frame structure, flat roof, 11 floors above ground and 1 floor below ground
8) Completion (Description in Real Property Registry) October 26, 2007
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 12 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
9) Design and Construction Design: Urban Dynamics Institute, TAKAHA Construction: Shimizu Corporation
10) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥ 9,320,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥9,320,000,000 Price based on direct capitalization method ¥8,990,000,000 Net revenue ¥512,296,000 Cap rate 5.7% Price based on DCF method ¥9,460,000,000 Discount rate 5.5% Terminal cap rate 5.9% Integration value ¥7,510,000,000 Percentage for land 38.4% Percentage for building 61.6%
11) Earthquake PML 4.3%(obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
12) Existence of Secured Interests (liens) None.
13) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: ・Total number and summary of lessees: 1 company (financial institution) ・Total rental revenues: not disclosed due to the fact that the lessee’s consent to disclosure has not been obtained. ・Total rentable area:13,761.63 m2 ・Total leased area:13,761.63 m2 ・Occupancy Rate:100.0% ・Total lease deposit amount: not disclosed due to the fact that the lessee’s consent to disclosure has not been obtained.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 13 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
4. Outline of Sellers (As of December 31, 2010) Mitsui Fudosan. Co., Ltd. 1. Name Mitsui Fudosan Co., Ltd. 2. Location 1-1, Nihonbashi-Muromachi 2-chome, Chuo-ku, Tokyo 3. Name and Title of Hiromichi Iwasa, President and Chief Executive Officer Representative 4. Description of Business Real estate business 5. Capital ¥174,296million (As of September 30, 2010) 6. Date of Establishment July 15, 1941 7. Relations with NBF/NBFM shareholder of NBFM (43% equity interest) Capital Relationship owns 19,735 shares of NBF Personnel certain personnel seconded to NBFM contractor of office management services; provider of tenant Business Relationship attracting services; broker for real property sale and purchase etc.; lessee of real property owned by NBF etc. does not fall under the category of related parties of NBF. Related parties a parent of NBFM, falling under the category of its related parties.
Cool Spring Investment TMK 1. Name Cool Spring Investment TMK 2. Location 1-20, Nihonbashi-Muromachi 3-chome, Chuo-ku, Tokyo 3. Basis for Establishment a corporation established under the Act on Securitization of etc Assets 4. Objectives 1. to accept specified assets, to perform services of managing and disposing of such specified assets in accordance with an asset securitization plan under the Act on Securitization of Assets; and 2. to perform any other services ancillary to securitization of the said specified assets. 5. Date of Establishment December 1, 2006 6. Specified Capital ¥100,000 7. Outline of Investors and The seller is a special purpose company (TMK) all of whose investment ratio preferred shares are subscribed by Mitsui Fudosan Co., Ltd. which falls under the category of Interested Parties etc. of NBFM as defined under the Investment Trust Act. 8. Matters Concerning Akira Sugai Officers 9. Relations with NBF/NBFM While the seller does not fall under the category of Interested Parties etc. of NBFM under the Investment Trust Act, since Mitsui Fudosan Co., Ltd., which falls under the category of Interested Parties etc. of NBFM, has subscribed all preferred shares of the seller and provides services for managing specified assets, the current transaction is being treated as a transaction with
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 14 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
Interested Parties etc. in accordance with the internal rules of the asset management company.
Sumitomo Life Insurance Company 1. Name Sumitomo Life Insurance Company 2. Location 4-35, Shiromi 1-chome, Chuo-ku, Osaka City, Osaka Prefecture 3. Name and Title of Yoshio Sato, President and CEO Representative: 4. Description of Business Life insurance business 5. Capital ¥439,000million (“funds (including the reserve for redemption of funds)” as of September 30, 2010) 6. Date of Establishment May 11, 1907 7. Relations with NBF/NBFM shareholder of NBFM (35% equity interest) Capital Relationship owns 12,256 shares of NBF Personnel certain personnel seconded to NBFM Business Relationship lender, lessee of real property owned by NBF etc. does not fall under the category of related parties of NBF, Related parties is an affiliated company of NBFM, falling under the category of its related parties.
Shimizu Corporation 1. Name Shimizu Corporation 2. Location Seavans South, 2-3 Shibaura 1-chome, Minato-Ku, Tokyo 3. Name and Title of Yoichi Miyamoto, President and Representative Director Representative: 4. Description of Business general construction business 5. Capital ¥74,365million (As of March 31, 2010) 6. Date of Establishment August 24, 1937 7. Relations with NBF/NBFM Capital Relationship None Personnel None Business Relationship None does not fall under the category of related parties of either NBF or Related parties NBFM.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 15 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
5. Status of Owners etc. of the Properties Name of Status of Owners etc. of the Properties Assets previous owner (seller) earlier previous owner I. Corporate Name/Name Mitsui Fudosan Co., Ltd. River City falls under the category of Relationship with a M-SQUARE Interested Parties etc. of specially interested party NBFM History/Reason etc. for N/A new construction acquisition Acquisition Price ― January 15, 2010 (new Date of Acquisition construction) II. Corporate Name/Name Mitsui Fudosan Co., Ltd. Nihonbashi falls under the category of Relationship with a Kabuto-cho Interested Parties etc. of specially interested party M-SQUARE NBFM History/Reason etc. for N/A new construction acquisition Acquisition Price ― June 15, 2009 (new Date of Acquisition construction) III. Corporate Name/Name Cool Spring Investment TMK Hakata Gion falls under the category of Relationship with a M-SQUARE Interested Parties etc. under specially interested party NBFM’s internal rules History/Reason etc. for N/A new construction acquisition Acquisition Price ― June 25, 2009 Date of Acquisition (new construction) IV. not disclosed due to the Gate City fact that the earlier Sumitomo Life Insurance Ohsaki Corporate Name/Name previous owner’s Company (Additional consent to disclosure Acquisition) has not been obtained falls under the category of does not fall under the Relationship with a Interested Parties etc. under category of any specially specially interested party NBFM’s internal rules interested party History/Reason etc. for acquired for the purpose of ― acquisition investment management not disclosed as the previous Acquisition Price owner owns the same for ― more than one year December 1, 1999 Dates of Acquisition ― and March 1, 2002
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 16 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
V. Corporate Name/Name Shimizu Corporation ― Chofu South does not fall under the Gate Bldg. Relationship with a category of any specially ― specially interested party interested party
6. Forecasted Management Situation as at the close of June, 2011 For information on the impact of the current acquisition of the 5 Properties upon NBF’s management situation during the period ending June 30, 2011, please see the “Notice Concerning Revision of Forecasted Management Situation for the Period ending June 30, 2011 and Forecast of Management Situation for the Period ending December 31, 2011” of the same date hereof. End
This English language notice is a translation of the Japanese language notice dated January 11, 2011 and was prepared solely for the convenience of, and reference by, overseas investors. Neither NBF nor Nippon Building Fund Management Ltd. makes any warranties as to its accuracy or completeness.
【Reference Material 3】 Total Acquisiton Price and Estimated Revenues and Expenses from the 5 Properties and NBF Ueno Bldg. 【Reference Material 4】 Summary of Portfolio after Acquisition of the 5 Properties
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 17 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
【Reference Material 1】 Estimated Revenues and Expenses from the 5 Properties to be Acquired
NOI Estimated NO. (Net Operating Occupancy Rate Income) I. River City M-SQUARE ¥735million 95.0% II. Nihonbashi Kabuto-cho M-SQUARE ¥247million 95.0% III. Hakata Gion M-SQUARE ¥489million 92.0% IV. Gate City Ohsaki (Additional Acquisition) ¥529million 95.0% V. Chofu South Gate Bldg. ¥563million 100.0% Total ¥2,563million －
(Premises upon which Estimated Revenues and Expenses are based) The above figures represent annualized revenues and expenses after exclusion of extraordinary factors for the year of acquisition （and are not estimated figures for the following fiscal year).
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 18 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
【Reference Material 2】 Exterior Photos and Floor Plans of the 5 Properties to be Acquired
I. River City M-SQUARE : Exterior Appearance of the Property
I. River City M-SQUARE : Standard Floor Plan of the Property
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 19 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
II. Nihonbashi Kabuto-cho M-SQUARE : Exterior Appearance of the Property
II. Nihonbashi Kabuto-cho M-SQUARE : Standard Floor Plan of the Property
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 20 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
III. Hakata Gion M-SQUARE : Exterior Appearance of the Property
III. Hakata Gion M-SQUARE : Standard Floor Plan of the Property
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 21 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
IV. Gate City Ohsaki (Additional Acquisition) : Exterior Appearance of the Property
IV. Gate City Ohsaki (Additional Acquisition) : Standard Floor Plan of the Property
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 22 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
V. Chofu South Gate Bldg. : Exterior Appearance of the Property
V. Chofu South Gate Bldg. : Standard Floor Plan of the Property
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 23 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
【Reference Material 3】 Total Acquisition Price and Estimated Revenues and Expenses from the 5 Properties and the NBF Ueno Bldg.
Acquisition NO. Name of Assets NOI Date of Transfer Price I. River City M-SQUARE ¥13,350million ¥735million II. Nihonbashi Kabuto-cho M-SQUARE ¥4,850million ¥247million February 28, 2011 III. Hakata Gion M-SQUARE ¥8,000million ¥489million IV. Gate City Ohsaki (Additional Acquisition) ¥11,650million ¥529million March 31, 2011 V. Chofu South Gate Bldg. ¥9,320million ¥563million April 15, 2011 ※ NBF Ueno Bldg. ¥10,400million ¥409million January 31, 2011 Total ¥57,570million ¥2,972million
※NBF Ueno Bldg. 1) Valuation Valuation prepared by Daiwa Real Estate Appraisal Co., Ltd. ・Appraisal Value: ¥8,240,000,000 ・Date of Valuation: December 31, 2010 ・Summary of Valuation Item Value Profit price ¥8,240,000,000 Price based on direct capitalization method ¥8,650,000,000 Net revenue ¥423,994,000 Cap rate 4.9% Price based on DCF method ¥8,060,000,000 Discount rate 4.7% Terminal cap rate 5.1% Integration value ¥6,640,000,000 Percentage for land 44.7% Percentage for building 55.3%
2) Earthquake PML 1.9% (obtained from the building condition investigation report prepared by Engineering & Risk Services Corporation)
3) Tenancy Situation etc. The tenancy situation as of November 30, 2010 is as follows: ・Total number and summary of lessees: 6 companies (6 general business companies) ・Total rental revenues: ¥553 million/year ・Total rentable area: 8,510.60 m2 ・Total leased area: 8,503.82 m2 ・Occupancy Rate: 99.9% ・Total lease deposit amount: ¥481million
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 24 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares
【Reference Material 4】 Summary of Portfolio after Acquisition of the 5 Properties Value (Real Estate Acquisition Price Percentage of Appraisal Value) Area Name of Building (Yen in thousands) Percentage each area (Yen in thousands) (Note 1) (Note 2) NBF Hibiya Bldg. 63,500,000 7.59% 56,500,000 Nishi-Shinjuku Mitsui Bldg. 44,903,393 5.36% 48,300,000 Gate City Ohsaki 30,100,000 3.60% 30,700,000 Gate City Ohsaki (Additional Acquisition) (Note 3) 11,650,000 1.39% 12,000,000 Total 41,750,000 4.99% 42,700,000 Shiba NBF Tower 32,000,000 3.82% 27,500,000 NBF Platinum Tower 31,000,000 3.70% 50,400,000 NBF Minami-Aoyama Bldg. (Note 7) 31,000,000 3.70% 16,800,000 Toranomon Kotohira Tower 24,543,000 2.93% 30,400,000 NBF Nihonbashi Muromachi Center Bldg. 23,945,000 2.86% 27,200,000 Nakameguro GT Tower 23,856,000 2.85% 22,600,000 Mitsuiseimei Ochanomizu Bldg. (Note 7) 20,840,000 2.49% 14,600,000 NBF Ginza Street Bldg. 17,000,000 2.03% 14,500,000 Shinjuku Mitsui Bldg. No.2 16,285,400 1.95% 16,000,000 GSK Bldg. 15,616,000 1.87% 21,100,000 River City M-SQUARE (Note 4) 13,350,000 1.59% 13,400,000 NBF Toranomon Bldg. 13,337,000 1.59% 16,600,000 Tokyo CBDs 63.5% Kowa Nishi-Shinbashi Bldg. B 13,217,000 1.58% 16,400,000 Nippon Steel Bldg. No.2 12,614,118 1.51% 13,930,000 NBF Alliance 9,126,000 1.09% 10,400,000 Yotsuya Medical Bldg. 8,800,000 1.05% 7,380,000 Shibuya Garden Front 8,700,000 1.04% 13,600,000 NBF Shibuya East 8,000,000 0.96% 6,640,000 NBF Shibakouen Bldg. 6,770,000 0.81% 8,360,000 NBF Takanawa Bldg. 6,667,200 0.80% 7,320,000 NBF Akasaka Sanno Square 6,250,000 0.75% 7,400,000 NBF Shibakouen Daimon Street Bldg. (Note 7) 6,100,000 0.73% 4,390,000 Sumitomo Densetsu Bldg. 5,365,000 0.64% 6,020,000 NBF Higashi-Ginza Square 5,200,000 0.62% 7,250,000 NBF Ogawamachi Bldg 4,940,000 0.59% 5,500,000 Nihonbashi Kabuto-cho M-SQUARE (Note 4) 4,850,000 0.58% 4,850,000 NBF Ikebukuro Tower 4,695,000 0.56% 5,050,000 NBF Ikebukuro City Bldg. 4,428,000 0.53% 4,900,000 NBF Sudacho Verde Bldg. 3,280,000 0.39% 3,210,000 Nakanosakaue Sunbright Twin 40,750,488 4.87% 31,200,000 NBF Toyosu Canal Front 35,200,000 4.20% 35,700,000 NBF Toyosu Garden Front 25,018,000 2.99% 28,700,000 NBF Ueno Bldg. (Note 5) 10,400,000 1.24% 8,240,000 Chofu South Gate Bldg. (Note 6) 9,320,000 1.11% 9,320,000 Shin-Kawasaki Mitsui Bldg. 20,300,000 2.42% 16,700,000 Yokohama ST Bldg. 13,529,300 1.62% 15,200,000 Other Greater Parale Mitsui Bldg. 3,800,000 0.45% 25.0% 3,470,000 Tokyo NBF Atsugi Bldg. 2,300,000 0.27% 2,110,000 Tsukuba Mitsui Bldg. 8,875,500 1.06% 7,560,000 NBF Utsunomiya Bldg. 2,435,000 0.29% 2,090,000 S-ino Omiya North Wing 16,816,345 2.01% 19,500,000 NBF Urawa Bldg. 2,000,000 0.24% 1,760,000 NBF Shin-Urayasu Tower 15,700,000 1.88% 11,500,000 NBF Matsudo Bldg. 2,455,000 0.29% 2,290,000 Sapporo L-Plaza 4,404,405 0.53% 6,390,000 NBF Sapporo Minami Nijo Bldg. 1,870,300 0.22% 1,560,000 NBF Sendai Honcho Bldg. 3,566,000 0.43% 3,170,000 NBF Unix Bldg. 4,028,900 0.48% 3,350,000 NBF Niigata Telecom Bldg. 3,957,500 0.47% 3,020,000 NBF Nagoya Hirokoji Bldg. 7,232,000 0.86% 7,870,000 Aqua Dojima NBF Tower 17,810,000 2.13% 19,200,000 Shinanobashi Mitsui Bldg. 14,400,000 1.72% 13,400,000 Other Cities Sun Mullion NBF Tower 10,500,000 1.25% 11.5% 8,300,000 Sakaisuji-Honmachi Center Bldg. 6,500,000 0.78% 6,570,000 NBF Sakai-Higashi Bldg. 2,227,200 0.27% 1,660,000 Aqua Dojima East 1,914,000 0.23% 1,900,000 NBF Shijo Karasuma Bldg. 1,627,000 0.19% 1,330,000 NBF Hiroshima Tatemachi Bldg. 2,930,000 0.35% 2,610,000 Hiroshima Fukuromachi Bldg. 835,000 0.10% 810,000 Hakata Gion M-SQUARE (Note 4) 8,000,000 0.96% 8,000,000 NBF Kumamoto Bldg.(Note 7) 4,500,000 0.54% 3,690,000 Total 837,130,050 100.00% 100.00% 839,370,000 (Note 1) “Acquisition Price” represents in principle the price for which NBF acquired the property. The “Acquisition Price” for property to be acquired in the future represents the sale and purchase price set forth in the relevant sale and purchase contract etc. (Note 2) The “Value (Real Estate Appraisal Value)” figures in the above table are in principle the appraisal values disclosed as of the end of June 2010 (real estate appraisal value with date of valuation being June 30, 2010). (Note 3) Expected to be acquired on March 31, 2011. The date of valuation for the ''value (real estate appraisal value)'' is December 31, 2010. The sale and purchase price (the total amount of the acquisition price and the reserve for repairs) for the property is \12 billion. Since the amount of the reserve for repairs as at the anticipated acquisition date is yet to be confirmed, the acquisition price is not fixed at present. Therefore, the anticipated acquisition price is an approximate estimate. (Note 4) Expected to be acquired on February 28, 2011. The date of valuation for the ''value (real estate appraisal value)'' is December 31, 2010. (Note 5) Acquired on January 31, 2011. The date of valuation for the ''value (real estate appraisal value)'' is December 31, 2010. (Note 6) Expected to be acquired on April 15, 2011. The date of valuation for the ''value (real estate appraisal value)'' is December 31, 2010. (Note 7) Commencing with the ongoing appraisal as of the end of December 2010 (expected to be disclosed in February 2011), the existing three real estate appraisers will be consolidated into two appraisers. As the result, the real estate appraisers for 4 properties among the properties listed above will be changed.
Note: This document constitutes a general announcement to the press concerning NBF’s acquisition of assets and 25 is not intended to solicit investment from investors. Please be aware that investors are fully responsible for their own investment decisions and it is recommended that they review offering circulars and prospectus, including amendments thereto, if any, prepared by NBF for issuance of new shares