For the Fiscal Period Ended October 31, 2018 (8th Fiscal Period) IR Presentation Securities Code: 3451 Contents 3 Overview of Financial Results 23 APPENDIX Overview of the 8th Fiscal Period Governance and Social Initiatives Cash Distribution per Unit Environmental Initiatives Unitholder Composition (at End of 8th Fiscal Period) 6 Operating Results IR Activities Occupancy Rate Balance Sheet Rent Situation Statement of Income Key Occupancy Rate Changes / Portfolio List (36 properties) ML and End Tenant Occupancy Rates Distribution of Tenants (at End of 8th Fiscal Period) Investments to Maintain/Improve Property Value and Occupancy Rate Earnings Performance of Properties (1) (at End of 8th Fiscal Period) Appraisal Value at End of 8th Fiscal Period Earnings Performance of Properties (2) Status of Unrealized Gains (at End of 8th Fiscal Period) (at End of 8th Fiscal Period) Earnings Performance of Properties (3) 13 After Public Offering and (at End of 8th Fiscal Period) Property Transfer Earnings Performance of Properties (4) (at End of 8th Fiscal Period) Earnings Forecast for the 9th and 10th Fiscal Periods Earnings Performance of Properties (5) (at End of 8th Fiscal Period) Acquisition of 6 Properties (¥10,692 MM) and Transfer of 1 Property (¥1,150 MM) List of Properties (1) Changes in Portfolio List of Properties (2) Main Portfolio Indicators List of Properties (3) New Borrowings and Refinancing List of Properties (4) Financial Management List of Properties (5) List of Properties (6) 20 Future Policy Profile of Tosei Reit Future Measures and Management Points Profile of Tosei Asset Advisors, Inc. Return to Unitholders Disclaimer Earnings Announcement for 8th Fiscal Period 2 Overview of Financial Results Overview of the 8th Fiscal Period Compared with initial forecast, operating revenue +2.7% at ¥2,051 MM and net income +4.4% at ¥805 MM The increases were mainly attributable to better-than-expected rent revenue from residential properties Results for the 8th Fiscal Period Main Factors of Changes in Net Income (¥ MM) (compared with initial forecast) Period Ended October 31, 2018 (¥ MM) (8th Fiscal Period) 850 Period Ended +53.9 Actual April 30, 2018 Compared Forecast Actual result (7th Fiscal Period) with 805 Announced Result -13.2 June 15, 2018 Forecast Initial -6.8 forecast 771 Days in Increase in 181 184 184 ― property- Other 750 related operation Increase in operating property- expenses Operating related 2,002 1,997 2,051 +2.7% operating revenue revenue Operating 1,001 949 981 +3.4% income 650 分類 1 分類 2 分類 3 分類 4 分類 5 Ordinary 828 772 805 +4.4% income (¥ MM) Increase in property-related operating revenue (Of which +15.3 for residential rent, +6.5 for office rent, +3.1 for shop rent, +12.6 +53.9 Net income 828 771 805 +4.4% for utilities revenue and +15.0 for other operating revenue (construction to restore properties to original state, renewal fees, cancellation penalties, etc.)) Cash Increase in property-related operating expenses distribution 3,532 3,289 3,435 +4.4% (Of which -7.6 for increase in PM fees, -3.3 for increase in utilities expenses, -13.2 -11.6 for increase in repair and maintenance expenses and +9.7 for decrease in per unit (¥) other (advertising expenses)) Other Total assets 51,272 ― 51,537 ― (Of which -3.5 for increase in depreciation, -5.0 for increase in G&A expenses -6.8 and +1.7 for decrease in non-operating expenses (interest expenses)) Earnings Announcement for 8th Fiscal Period 4 Cash Distribution per Unit Actual result for the 8th Fiscal Period was ¥3,435 per unit, +¥146 from the recent forecast Cash distribution per unit (¥) Initial forecast (Note) 4,000 Actual result 3,592 3,532 3,435 3,500 3,371 3,382 3,289 3,208 3,256 3,259 3,202 (Note) 3,063 2,986 3,000 2,844 2,772 2,500 1,938 2,000 1,500 1,000 500 373 0 Results for the Results for the Results for the Results for the Results for the Results for the Results for the Results for the Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended April 30, 2015 October 31, 2015 April 30, 2016 October 31, 2016 April 30, 2017 October 31, 2017 April 30, 2018 October 31, 2018 (1st Fiscal Period) (2nd Fiscal Period) (3rd Fiscal Period) (4th Fiscal Period) (5th Fiscal Period) (6th Fiscal Period) (7th Fiscal Period) (8th Fiscal Period) IPO 1st PO 2nd PO 3rd PO 1 property 12 properties 5 properties 5 properties 8 properties ¥1.4 BN ¥17.4 BN ¥11.9 BN ¥5.3 BN ¥9.8 BN Note: The figure announced first is listed as the initial forecast. The initial forecast for the fiscal period ended October 31, 2018 (8th Fiscal Period) was released on June 15, 2018. Earnings Announcement for 8th Fiscal Period 5 Operating Results Occupancy Rate At 98.2% at the end of the 8th Fiscal Period, maintained high occupancy rate of the same level as the previous period Occupancy rates of retail facilities slightly decreased, but were covered by the strong occupancy rates of offices and residential properties Occupancy Rate (Note) 1st Fiscal Period 2nd Fiscal Period 3rd Fiscal Period 4th Fiscal Period 5th Fiscal Period 6th Fiscal Period 7th Fiscal Period 8th Fiscal Period (%) 100 95 90 November April October April October April October April October 2014 2015 2015 2016 2016 2017 2017 2018 2018 End of End of End of End of End of End of End of End of 1st Fiscal Period 2nd Fiscal Period 3rd Fiscal Period 4th Fiscal Period 5th Fiscal Period 6th Fiscal Period 7th Fiscal Period 8th Fiscal Period (Actual result) (Actual result) (Actual result) (Actual result) (Actual result) (Actual result) (Actual result) (Actual result) Total 96.2% 97.5% 96.5% 98.1% 98.4% 98.4% 98.2% 98.2% Offices 97.4% 99.3% 98.4% 99.3% 98.8 % 99.1% 99.1% 99.5% Retail facilities 100.0% 100.0% 100.0% 100.0% 100.0 % 100.0% 99.7% 98.2% Residential 93.9% 95.1% 92.4% 95.5% 97.0% 96.7% 97.0% 97.1% properties Note: The occupancy rate is the ratio of leased area to leasable area. Earnings Announcement for 8th Fiscal Period 7 Rent Situation New / Cancelled Rents Rent Revision Comparison (leased area basis) • In the 8th Fiscal Period, although cancellations exceeded new Contracts up for renewal: 231 Contracts up for renewal: 213 contracts with there being 96 new contracts and Renewal rate: 90% Renewal rate: 91% 100 cancellations, difference was +¥0.1 MM in monthly rent 28.0% 15.9% (75) • Attributable to new contracts for residential units of relatively (52) high rent, such as Gekkocho Apartment’s difference of +2 contracts (+¥560,000 in monthly rent) and Twin Avenue’s difference of +1 contract (+¥240,000 in monthly rent) Period Ended Period Ended Rent Revisions April 30, 2018 October 31, 2018 (7th Fiscal Period) (8th Fiscal Period) • Of the 194 renewals, rents were increased for 75 207 194 2 Total 18,674.83 m 2 • Continuing on from the previous period, the rate of rent increase Total 14,973.79 m exceeded 3% New / Cancelled Rents (8th Fiscal Period) 84.1% (155) Retail Residential Offices Total 72.0% facilities properties Rent increase Rent decrease No change (119) Number of contracts 3 1 92 96 Rent Increases (number of increases and rate of increase) New (%) Contracted area (m2) 601.76 52.61 4,135.55 4,789.92 contracts 8 75 80 Monthly rent (¥ MM) 1.7 0.1 10.4 12.3 70 60 Number of contracts 2 2 96 100 52 3.82 50 Cancel- 3.62 3.41 Contracted area (m2) 447.05 306.64 4,071.00 4,824.69 4 37 40 lations 25 27 3.96 25 3.78 30 Monthly rent (¥ MM) 1.4 0.6 10.0 12.2 14 3.00 20 9 2.13 1.65 Number of contracts 1 -1 -4 -4 10 0 0 Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended Period Ended 2 April 30, 2015 October 31, 2015 April 30, 2016 October 31, 2016 April 30, 2017 October 31, 2017 April 30, 2018 October 31, 2018 Change Contracted area (m ) 154.71 -254.03 64.55 -34.77 (1st Fiscal Period) (2nd Fiscal Period) (3rd Fiscal Period) (4th Fiscal Period) (5th Fiscal Period) (6th Fiscal Period) (7th Fiscal Period) (8th Fiscal Period) Rate of increase Number of increases Monthly rent (¥ MM) 0.2 -0.5 0.4 0.1 (left axis) (right axis) Earnings Announcement for 8th Fiscal Period 8 Key Occupancy Rate Changes / ML and End Tenant Occupancy Rates During the 8th Fiscal Period, occupancy rate of office properties hovered above 99.5% and also secured contracts for some vacant space Occupancy rate of end tenants of Tama Center Tosei Building was 89.9% at the end of the 8th Fiscal Period and is expected to increase to around 94% to 98% thereafter Key Occupancy Rate Changes Occupancy Rate of End Tenants of Tama Center Tosei Building (Note) 100.0 End of 7th End of 8th Change in Property Name Fiscal Period Fiscal Period Leased Area 88.8 89.9 94.4 238.3 87.2 86.0 98.4 98.4 Hakusan Asanomi 91.7% 100.0% +154.71 m2 80.6 82.4 Building 2 Live Akabane 95.0% 100.0% +194.87 m 127.4 132.6 119.8 117.7 110.4 Gekkocho Apartment 85.2% 94.7% +132.62 m2 73.5 50.9 51.9 46.1 Chojamachi Duo 89.4% 89.4% 0.00 m2 Building Wako Building 98.1% 92.1% -171.10 m2 -39.1 -30.1 -80.7 Hakusan Asanomi Building -110.4 Secured contract for vacant 6F -162.1 Ahead, financial institution that is the tenant occupying 1F and 2017/4 2017/10 2018/4 2018/10 2019/4 portion of 2F is scheduled to vacate, and the succeeding tenant is Vacated (tsubo) Occupied (tsubo) scheduled to move in in March 2019 Occupancy rate based on master lease (%) Occupancy rate of end tenants (%) Space Tenant Contract Start Occupancy Rate of End Tenants of Musashi Fujisawa Tosei Building 100.0 6F Rehabilitation gym From May 1, 2018 1F and portion of 2F Drugstore From Mar.