Financial Results for the 25th Fiscal Period (Ended September 30, 2018)

Transcription

1 Financial Results for the 25th Fiscal Period (Ended September 3, 218) November 16, 218

2 Table of Contents 1 I. Executive Summary for the 25th (September 218) Fiscal Period 2 II. Financial Results for the 25th (September 218) Fiscal Period 8 III. Forecast for the 26th and the 27th Fiscal Periods 14 IV. Detailed Information for the 25th Fiscal Period 16 V. Future Growth Strategy 37 Appendices 42

3 I. Executive Summary for the 25th (September 218) Fiscal Period 2

4 3 Executive Summary for the 25th Fiscal Period 1. Operation: Average 98.2% occupancy rate and increase of rents in approx. 5% of the new contracts of 1,491 Average Unit Occupancy rate: 98.2% (+.4 points higher than the initial forecast) including 98.6% for the month of Sep. Number of the Long-term Vacancy Units (over 6days): 35 units as of Sep.3 (only.3% of total units of 13,223) Rent: Rent increase in terms of the new contracts of 1,491 : 5.1% (1.4 points down from the previous fiscal period) vs rent decrease 36.5% (1.9 points up from the previous period) as for the renewals (2,288), rent increase 3.5% (.2 points down from the previous period) vs rent decrease.1% (.1 points up from the previous period) Parking occupancy rate: 93.2% as of Sep.3 Maintain and enhance property value: Spent JPY 1,73 million in capital expenditures including the large-scale repairs of 11properties (JPY 784 million) and unit renovation of the 38 units (JPY 75 million) Reduction of the Operating expenses: Reduced trust banks fees by JPY 7 million due to changes in type of the ownership form Trust Beneficiary Interest ( TBI ) to real estate (non TBI) for the 4 properties As a result, total trust bank fees related the above decreased by JPY 117 million (from JPY 126 million for 1 th FP to JPY only 9 million for 25 th FP) in 7 years (April~September Average Occupancy rate Comparison) 25th(218) :98.2% - 23rd( 217):98.2% (+.1P) 21st(216) :98.1% (-.3P) 19th(215) :98.4% - From April 1, 218, a function of information of Increase/Stay/Decrease new rents (by region/by type) is added to the Daily Occupancy Forecasting System It enables an understanding of accumulated rents since the beginning of the term by every 2 hours. 2. Refinancing of Bank Debt of JPY14.46 billion Refinanced the above due on June 22, 218 (based on the contract executed on March 19, 218) Of the above, JPY billion of floating rate borrowings were fixed through interest rate swap agreements together with the refinancing Changes in financing costs before and after the refinancing : from a borrowing tenor of 5 years with a floating rate of 1.45% to a borrowing tenor of 7.3 years with fixed average rates of.88% Interest-bearing debt average of 1.21% for the 24th FP reduced to 1.9% for the 25th FP 3. Sustainability Initiatives: Participation in the GRESB Assessment for the first time in 218 (Preparations began in July 217 in response to the requests from European investors, please refer to page 32) Green Star (excellent initiatives in management and policy and execution and measurement ) 2 Star (5-tier assessment of the GRESB rating, relative order of comprehensive score) 4. IR: Enhanced activities for overseas, institutional and individual investors Called on 47 institutional investors (35 in Tokyo and 12 regional financial institutions outside of Tokyo) Had a regular trip to Amsterdam, London, Philadelphia, Boston and New York and one-on-one meetings with 16 investors in Europe and the US Participated in 3 presentation meetings for individual investors arranged by securities companies, etc. (with total attendance of 344 unitholders) Held regular (biannual) briefing sessions for JRH retail unitholders in Tokyo, Nagoya, Osaka and Fukuoka (with total attendance of 339 unitholders) 5. Progress in Medium-Term Plans: Achieved range of 1,9 yen DPU in stabilized basis (Please refer to page 4) 6. Merger of the Asset Manager (Please refer to page 33) Mi-Casa Asset Management Inc. (absorbed corporation) merged with Daiwa Real Estate Asset Management Co., Ltd. (surviving corporation) as of October 1, 218 (Ratio of investment units held as of September 218 (change from previous period)) Ratio of financial institutions increased from the previous period Financial institutions (including financial instruments business 54.5%(-.8P) operators) Foreign companies 31.9%(+1.9P) Individuals and others 9.3%(-.9P) Other companies 4.4%(-.1P) Total 1.% *Please refer to page 6 for details. *Included to FTSE EPRA/NAREIT from Mar 216

5 Progress of Medium-Term Target of Distribution per Unit [Asset manager s understanding] The measures below except the acquisition of new properties are being achieved in line with the plan. 1. Acquisition of new properties (Also conducting disposition considering market trends) Target (JPY million) Amount achieved in 25th FP (JPY million) (1,~) 2, Accumulated amount achieved (JPY million) 5,347 (Note 1) Progress rate (%) 26.7 Contribution to distribution (Note 2) 37 ( 6) Medium-term target of distribution (Released in November 216, detail in page ) : Aim to achieve JPY 1,9 2, of distribution per unit on a normal basis over the threeyear period from 22nd FP (ended March 217) to 27th FP (ending September 219) (Sources for the increase of JPY 3: JPY 1 from external growth + JPY 2 from internal growth, etc.) Acquisition of new properties Sources for distribution +JPY 1 (+JPY 7-14) 5,347 14,652 5, 1, 15, 2, 25, (JPY mn) (Note 1) Breakdown of the total amount of JPY 5,347 million based on acquisition prices [New acquisition] 22nd FP: 1 property in Sapporo (JPY 4,53 million), 23rd FP: 3 properties in Osaka (JPY 4,19 million) [Disposition] 22nd FP: 1 property in Sapporo and 4 properties in Kansai (JPY 1,484 million), 23rd FP: 1 property in Osaka (JPY 1,391 million) 24th FP: 1 property in Asahikawa (JPY 326 million) 2. Reduction of costs and payout of distribution reserves Target (JPY million) Amount achieved in 25th FP (JPY million) Accumulated amount achieved (JPY million) Progress rate (%) Contribution to distribution (Note 3) (Note 2) Distribution increase target JPY 14 / Asset size increase target JPY 2, million x Accumulated amount achieved JPY 5,347 million. In case of considering payout from reversal of distribution reserves 23 generated by the disposition of Abreast ShinOsaka and Satella Nagayama, the distribution amount will be 6 Sources for distribution +JPY 255 (up JPY 55 from initial +2) Reduction of BM fees 35. Reduction of trust fees 65. Reduction of financing costs (Note 4) Payout of reserve for temporary difference adjustment 67.3 (Note 6) (Note 5) Total Reduction of BM fees Reduction of trust fees Reduction of financing costs Payout of reserve for temporary difference adjustments (Note 3) Amount achieved in each category / Number of investment units issued and outstanding (1,64,6). (Note 4) Balance of interest bearing debt at the end of 21st FP (JPY 117,132 million) x (All-in financing costs for 21st FP (1.47%) target all-in costs for 27th FP (1.4%)) / 2. (Note 5) Excepting the influence of the interest rate swaps, which became due in 24th FP, under the basket method. (The swaps not attached to individual borrowings were executed in 213 at the time of collateralized borrowings.) (Note 6) Balance after distributing period-end distribution for 22nd FP (JPY 6,733 million) / 5 years / (JPY mn) 46 4

6 5 Comparison between the 24th (March 218) and the 25th (September 218) Fiscal Period 1. Portfolio Asset Size: NOI Yield: Appraisal Value: Unrealized Gain: NAV per unit: 24th Fiscal Period JPY bn 5.76% (198 properties based) JPY bn (198 properties based) JPY 38.3 bn (198 properties based) JPY 87,542 Asset Size: NOI Yield: Appraisal Value: Unrealized Gain: NAV per unit: 25th Fiscal Period [Changes from Previous Period] JPY bn [+JPY bn] 5.71% [-.5P] (198 properties based) JPY bn [+JPY 3.9 bn] (198 properties based) JPY 42.8 bn [+JPY 4.5 bn] (198 properties based) JPY 9,265 [+JPY 3,83] 2. Operations Number of Properties: Net Rentable Area: Average Occupancy Rate: (March 218: Average Rent at the end of the Period: 3. Finance Loan Balance: Ratio of Long-Term Interest Bearing Debt: Average Loan Period: Average Remaining Loan Period: Appraisal Value Based LTV: Total Assets Based LTV: Total Unitholders Capital: Total Units in Issue: Credit Rating: thousand m % 99.1%) JPY 98,189 JPY bn (Note2) 75.2% (Note2) 6.5 years (Note2) 3.34 years (Note2) 45.2% (Note2) 5.9% (Note2) JPY 91.7 bn [-] 1,64,6 units A+ Stable (JCR) A Stable (R&I) Number of Properties: Net Rentable Area: Average Occupancy Rate: (September 218: Average Rent at the end of the Period: Loan Balance: Ratio of Long-Term Interest Bearing Debt: Average Loan Period: Average Remaining Loan Period: Appraisal Value Based LTV: Total Assets Based LTV: Total Unitholders Capital: Total Units in Issue: Credit Rating: 198 [+] 532 thousand m 2 [+ thousand m 2 ] 98.2% [-.2P] 98.6% [-.5P]) JPY 98,182 [JPY -7] JPY bn [+JPY bn] (Note2) 81.6% [+6.4P] (Note2) 6.34 years [+.29 years] (Note2) 3.77 years [+.43 years] (Note2) To be extended to 4. yrs on December % [-.7%] (Note2) 5.9% [+.P] (Note2) JPY 91.7 bn [-] 1,64,6 units [-] A+ Stable (JCR) A Stable (R&I) (Note1) Interest-bearing debt that is due for repayment within one year is excluded from long-term interest bearing debt. (Note2) Unit; rounded down, %; rounded

7 6 Unitholders as of the 25th Fiscal Period End (as of September 3, 218) The Ratio of Investment Units Held September 218 Financial institutions (including financial instrument trading companies), 54.5% Other companies 4.4% Other foreign companies 31.9% Individuals and others 9.3% March 218 Financial institutions (including financial instrument trading companies), 55.3% Other companies 4.5% Other foreign companies 3.% Individuals and others 1.1% % 1% 2% 3% 4% 5% 6% 7% 8% 9% 1% <Top Unitholders > Ranking Unitholders (Top 1) Number of Units Held September 218 % of Total Units in Issue (Note 1) Change Number of Units Held as of March 218 (Note2) 1 The Master Trust Bank of Japan (Trust account) 342,5 2.8% -1, ,981 2 Japan Trustee Services Bank, Ltd. (Trust account) 237, % 9,61 228,281 3 Nomura Bank (Luxembourg) S.A. 85,25 5.1% -1,112 86,317 4 Nomura Trust and Banking Company (Trust account) 68, % -23,63 91,916 5 Trust & Custody Services Bank (Securities investment trust account) 6,79 3.7% 7,367 53,342 6 Daiwa Securities Group Inc. 55,14 3.3% 55,14 7 Mizuho Trust & Banking Co., Ltd. 27, % -9,676 36,837 8 STREET BANK WEST CLIENT TREATY , % 2,215 23,323 9 DFA INTERNATIONAL REAL ESTATE SECURITIES PORTFOLIO 25,22 1.5% 4,557 2,663 1 STATE STREET BANK AND TRUST COMPANY , % 8,14 16,635 <Number of Unitholders by Investor Type> Financial Institutions (including financial instrument trading companies) March 218 September 218 Change Other Domestic Companies Other Foreign Companies Individuals and Others 17,78 16,67-1,173 Total 18,286 17,118-1,163 (Note1) The ratio of investment units held in comparison to the total units in issue is rounded down to the second decimal point. (Note2) Indicate top 1 unitholders as of the end of September 218. Subtotal 952, %

8 JRH Unit Price/Distribution Yield/Trading Volume Unit price (JPY) 15, Distribution Yield 1% 1, 95, 218/11/12 9, 9% 9, 85, 8, 75, 7, 65, 6, 55, 5, 45, 4, 35, 3, Jul 1, 21 Merger with PRI Mar 11, 211 Great East Japan Earthquake JRH unit price TSEREIT TOPIX Nov 18 Daiwa Securities Group Acquired 3% Shares of AM Dec 11 Sponsor change to Daiwa Securities Group JRH Distribution Yield 218/11/ % 8% 7% 6% 5% 4% 3% 25, 2, Jul 21 Jan 211 Jul 211 Jan 212 Jul 212 Jan 213 Jul 213 Jan 214 Jul 214 Jan 215 Jul 215 Jan 216 Jul 216 Jan 217 Jul 217 Jan 218 Jul 218 2% Trading volume (# of units) 21, 18, 15, 12, 9, 6, 3, Jul 21 Jan 211 Jul 211 Jan 212 Jul 212 Jan 213 Jul 213 Jan 214 Jul 214 Jan 215 Jul 215 Jan 216 Jul 216 Jan 217 Jul 217 Jan 218 (Note) TOPIX,TSEREIT: Indexed based on JRH's investment unit price as of July 1, 21 Source: Bloomberg 7

9 II. Financial Results for the 25th (September 218) Fiscal Period 8

10 Key Figures Trend Sep 219 (27th) Forecast Mar 219 (26th) Forecast Sep 218 (25th) Result Sep 218 (25th) Forecast Mar 218 (24th) Sep 217 (23rd) Mar 217 (22nd) Sep 216 (21st) Mar 216 (2th) Sep 215 (19th) Mar 215 (18th) Sep 214 (17th) Mar 214 (16th) Sep 213 (15th) Mar 213 (14th) Sep 212 (13th) Mar 212 (12th) Sep 21 (9th) Operating Revenues (JPY million) Public offering Public offering 5,932 5,915 5,795 5,763 6,442 7,778 7,251 7,131 8,179 8,172 8,25 8,192 8,284 8,318 8,133 7,943 8,675 4,618 Merger with PRI (July 1, 21) 5, 1, 663 Net Profit (JPY million) 1,739 1,634 1,957 1,942 2,478 2,596 2,34 2,735 2,824 2,724 3,93 3,92 3,114 3,75 3,158 3,24 3,391 Distribution per Unit (JPY) 1,964 (Including JPY 64 the same as below forecast) 1,94 (Including distribution reserves JPY 23 & temporary difference adjustment JPY 41) 1,967 (Including distribution reserves JPY 18 & temporary difference adjustment JPY 41) 1,92 (Including gain on dispositions JPY44 & temporary difference adjustment JPY 41) 1,91 (Including appropriation of JPY 57 from distribution reserves) 1,7 (Including appropriation of JPY 32 from distribution reserves) 1,722 1,747 (Including appropriation of JPY 86 for loss from dispositions) 1,68 1,761 (Including JPY 78 for gain on dispositions of 2 properties) 1,617 1, 2, 3, 4, 5 1, 1,5 2, (Note) Figures on the 9th Fiscal Period do not include gains from negative goodwill. Performance figures on the 1th, 12th and 13th Fiscal Periods are real-term figures that exclude losses from property dispositions, etc. during the relevant period ,325 1,263 1,471 1,471 1,95 1,95 9

11 1 Financial Results Overview 25 th Fiscal Period (April 1, 218 September 3, 218) Forecast (as of May 15, 218) vs. Results for the 25th Fiscal Period (1) Forecast (May 15, 218) (2) Results Difference (2) (1) Operating Revenues 8,192 8, Key Factors of the Difference Rent and Common Benefit Revenue Increase Other Revenue Increase JPY million Operating Income 3,77 3, (Operating Expenses Increase 42) Repair Expense Decrease Restoration Expense Increase PM Fee Decrease Utility Expense Increase Advertisement Expense Increase Property Tax Increase +5 (35) +5 (3) (7) (3) (SG&A Decrease 1) Legal Fee Decrease Provision of allowance for doubtful accounts Decrease Other Decrease Ordinary Income 3,76 3, (Non-operating profit and loss Increase 12) Non-operating Income Increase Interest Expense Decrease Net Income Reversal of Temporary Difference Adjustment/ Distribution Reserve 3,75 3, Net Income per Unit Initial Forecast JPY 1,875 Result JPY 1,899 Total Distribution Amount 3,181 3, Distribution per Unit (JPY) 1,94 1, Number of investment units in issue as of the end of the fiscal period : 1,64,6

12 11. <25th Fiscal Period: Initial Forecast vs. Results> Operating Revenues +58 Operating Expenses (42) SG&A +1 Non-operating Profit +12 JPY million Distribution per Unit JPY 1,964 Distribution per Unit JPY 1,94 Total Distribution Amount 3,181 Temporary Difference Adjustment 67 Reversal of Distribution Reserve 38 Renewal Fee Revenue Increase 13 Other Income Increase 44 Repair Restoration, Advertisement Expense Increase 42 Legal Fee, Other SG&A Decrease 1 Interest Expense Decrease 12 Total Distribution Amount 3,221 Temporary Difference Adjustment Reserve 67 Reversal of Distribution Reserve 38 Total Distribution Amount +39 Net Income 3,114 Distribution 3,114 Net Income 3,75 25 th FP Forecast (May 15, 218) 25th FP Results

13 12 Results for the 24th Fiscal Period vs. the 25th Fiscal Period (1) 24th FP Results (2) 25th FP Results Difference (2) (1) Operating Revenues 8,284 8,25 (34) Key Factors of the Difference Rent and Common Benefit Revenue Decrease Key Money Revenue Increase Renewal Fee Increase Restoration Revenue Increase Gain on Sales of Properties Decrease JPY million (37) (3) Operating Income 3,85 3,733 (116) (Operating Expenses Increase 83) Repair Expense Increase Restoration Expense Increase Utility Expense Decrease Advertisement Expense Increase Trust Fee Decrease Other Increase Depreciation Increase (17) +19 (7) Ordinary Income 3,159 3,115 (43) (Non-operating profit and loss Increase 72) Interest Expense Decrease Finance Cost Decrease Net Income Reversal of Temporary Difference Adjustment/ Distribution Reserve Total Distribution Amount Distribution per Unit (JPY) 3,158 3,114 (43) Net Income per Unit ,225 3,221 (4) 1,967 1,964 (3) 24th FP JPY 1,925 25th FP JPY 1,899 Number of investment units in issue as of the end of the 23nd and 24rd fiscal period : 1,64,6

14 13. <Results for the 24th Fiscal Period vs. the 25th Fiscal Period> JPY million Operating Revenues (34) Operating Expenses (83) Non-operating Profit +72 Distribution per Unit JPY 1,967 Distribution per Unit JPY 1,964 Total Distribution Amount 3,225 Total Distribution Amount 3,221 Distribution Reserves 3 Temporary Difference Adjustment Reserve 67 Reversal of Distribution Reserve 31 Rent Revenue Decrease 3 Gain on Sales of Properties Decrease 3 Repair Expense, Restoration Expense, Advertisement Expense Increase 71 Interest Expense, Finance Cost Decrease 72 Total Distribution Amount (4) Temporary Difference Adjustment Reserve 67 Reversal of Distribution Reserve 38 Depreciation Increase Net Income 3,158 Distribution 3, Net Income 3,114 Distribution 3,114 24th FP Results 25th FP Results

15 III. Forecast for the 26th (March 219) and the 27th (September 219) Fiscal Periods 14

16 Forecast for the 26th (ended March 31, 219) and the 27th Fiscal Periods (ended September 3, 219) JPY million (1) 25th FP Results (2) Difference 26th FP (2) (1) Forecast Key Factors of the Difference (3) Difference 27th FP (3) (2) Forecast Key Factors of the Difference Operating Revenues Average Occupancy Rate Average Rent Per tsubo 8,25 8,172 (78) 98.2% 8, % 8,59 Rent and Common Benefit Revenue Decrease Other Decrease (14) (48) 8, % 8,57 Rent and Common Benefit Revenue Increase Renewal Fee Revenue Increase 2 2 Operating Income 3,733 3,683 (49) (Operating Expenses Decrease 24) Restoration Expense Decrease Advertisement Expense Decrease Depreciation Increase (34) (5) 17 3,66 (23) (Operating Expenses Increase ) Repair Expense Increase Utility Expense Decrease Depreciation Increase 1 (6) 16 (SG&A Decrease 3) AM Fee Decrease (2) (SG&A Increase 13) Other SG&A Increase 9 Ordinary Income 3,115 3,92 (22) Interest Expense Decrease Finance Cost Decrease (2) (31) 3,94 1 Interest Expense Decrease Finance Cost Decrease (7) (2) Net Income 3,114 3,92 (22) Net Income per Unit 25th FP JPY 1,899 26th FP JPY 1,885 3,93 1 Net Income per Unit 27th FP JPY 1,886 Reversal of Temporary Difference Adjustment/ Distribution Reserve Total Distribution Amount Distribution per Unit (JPY) years equal amortization from 23rd FP 5 years and 2 years equal amortization from 24th FP, 25th FP 3,221 3,198 (22) 3,198 1,964 1,95 (14) Number of investment units in issue as of the end of the fiscal period : 1,64, ,95 Number of investment units in issue as of the end of the fiscal period : 1,64,6 15

17 IV. Detailed Information for the 25th Fiscal Period 16

18 17 Occupancy and NOI Yield Occupancy Rates 9th 1th 11th 12th 13th 14th 15th 16th 17th 18th 19th 2th 21st 22nd 23rd 24th 1% % 92.7% 93.5% 92.9% 94.5% 5.29% 96.4% 5.48% Merger with PRI 95.8% 96.5% 96.2% 5.42% 97.8% 5.51% 97.3% 97.1% 96.5% 5.55% 98.1% Occupancy Rates 97.2% 97.7% 97.3% 98.8% 98.4% 98.4% 98.2% 98.1% 97.5% 99.% 98.6% 98.2% 5.72% 5.68% 5.68% 5.7% 5.69% 5.74% 5.73% 5.65% NOI Yield(right axis) 98.7% 98.4% 99.1% 98.6% 98.4% 98.2% 98.4% 98.1% 98.3% 98.2% 5.73% 5.67% 5.76% 25th NOI Yield 5.71% 6.% (NOI yield after depreciation 4.1%) 5.5% 9% 85% <Key Measures> October 21 - Started Three- Week Rule - Started provision on Longterm Vacancy Units (18days) April Started Key Focus Propertie s October Started Daily Occupanc y Rates Forecastin g System - Shorten to 15days Long-term Vacancy Units April Started Construct ion Approval Committee - Shorten to 12days Long-term Vacancy Units October Started Downtim e 6 days April More focusing on Key Focus Properties and Parking Occupanc y - Shorten to 9days Long-term Vacancy Units October 213 -Started Action 3 - Shorten to 6 days Long-term Vacancy Units April Track Number of 1% Occupied Proprieties May Daily Occupan cy Rates Forecasti ng System upgraded April Started Manage ment Policy by Property April 218 Information of rising/levelling off/declining of new rents (by region/by type) is added to the Daily Occupancy Forecasting System It enables an understanding of accumulated rents since the beginning of the term by every 2 hours. Jul/21 Oct/21 Jan/211 Apr/211 Jul/211 Oct/211 Jan/212 Apr/212 Jul/212 Oct/212 Jan/213 Apr/213 Jul/213 Oct/213 Jan/214 Apr/214 Jul/214 Oct/214 Jan/215 Apr/215 Jul/215 Oct/215 Jan/216 Apr/216 Jul/216 Oct/216 Jan/217 Apr/217 Jul/217 Oct/217 Jan/218 Apr/218 Jul/218 5.% 4.5%

19 18 Monthly Occupancy Rates September 218: Number of Properties by Occupancy Rate 1% 9%-95% 7.1% Below 9%.5% 99% (6 months average 98.2%) 98.7% 98.6% 98.4% 95%- 1% 42.9% 1% 49.5% 98% 97% Portfolio Studio Family 96% Apr 218 May 218 Jun 218 Jul 218 Aug 218 Sep 218 Occupancy Rate # of Properties Share 1% % 95%-1% % 9%-95% % Below 9% 1.5% Total % April 218 May 218 June 218 July 218 August 218 September 218 Studio 98.5% 98.2% 98.5% 98.4% 98.5% 98.7% Family 97.7% 97.7% 97.9% 98.% 98.% 98.4% Portfolio 98.2% 98.% 98.2% 98.2% 98.3% 98.6% By Region 3 Major Metropolitan Areas Other Major Cities 1% 1% 1% 99% 98% 98.7% 98.6% 98.6% 98.4% 99% 98% 99.% 98.3% 98.3% 99% 98% 99.4% 98.9% 98.7% 98.6% 98.% 97% 97% 96% Portfolio 23 wards of Tokyo 3 major metropolitan areas Other major cities Apr 218 May 218 Jun 218 Jul 218 Aug 218 Sep % 96% Kanto Tokai Kansai Apr 218 May 218 Jun 218 Jul 218 Aug 218 Sep % 95% Hokkaido Tohoku Shinetsu Chugoku Kyusyu Apr 218 May 218 Jun 218 Jul 218 Aug 218 Sep 218

20 Tracking the Process from Moving-out to Moving-in 198 properties as of the end of September ,223 units Occupancy 98.57% Move-in/out during the 25th FP (6 months) Move-in Move-out 1,52 units 1,46 units (Compared to the 24th FP +192 units) (Compared to the 24th FP+76 units) (March 212)Developed and installed original system (Intranet) Daily Occupancy Forecasting System (Sep. 215)A shift to the Internet(allowed to check data from outside) (Oct. 216~Feb. 218) Additional functions granted and enable PM to see information (April 218~) Added a function to monitor changes in new contracted rents * Leasing Preparation (after receiving cancellation notice) -3 days Restoration and Leasing Leasing day +3 days +6 days Cancellation Notice Management Policy by Property Policy on leasing and refurbishment for next tenant that reflects conditions of each property Move-out Inspecting units/acquiring estimates Three-Week Rule ((1) on next page) Progress management of work <within 3 weeks> High-cost Construction Approval Committee Pursuit of quality and appropriate cost (Mi-Casa standard specifications, highly transparent order placement through bidding) Application Contract Start Remaining contract period (1 month) ( up-time ) Downtime 6 days ((2) on next page) Application Contract Start Long-term Vacancy Units (over 6 days) ((3) on next page) * A function of Increase/Stay/Decrease information of new contact rents (by region by type) is add, enabling an understanding of accumulated rents from the beginning of the fiscal period every 2 hours. 19

21 2 Track Records of Asset Management (1) Three-Week Rule - Trends in Achieved Rate (2) Downtime 6 days Trends in Achieved Rates 1% 1% 9% 218/9 87.4% 8% 8% 212/4 83.7% April 218 September 218 # of construction 1,427 units 6% 4% 212/4 58.1% 218/9 8.3% 7% 2% 6% Apr/212 Dec/212 Aug/213 Apr/214 Dec/214 Aug/215 Apr/216 Dec/216 Aug/217 Apr/218 Mar218 % Apr/212 Dec/212 Aug/213 Apr/214 Dec/214 Aug/215 Apr/216 Dec/216 Aug/217 Apr/218 # of units 25 (3) Long-term Vacancy Units (over 6days) Trend in # of Units 95% (Changes in Parking Lot Occupancy Rate) 218/ % 2 211/ % of total units 9% As of 25th FP end; 35 units out of the total # of units 13, / % 21/1 8% 75.7% 75% Oct/211 Jul/212 Apr/213 Jan/214 Oct/214 Jul/215 Apr/216 Jan/217 Oct/217 Jul/218 7% 21/1 211/1 212/1 213/1 214/1 215/1 216/1 217/1

22 21 Track Records of Asset Management 1% 98% 96% 94% 92% Economical occupancy, Occupancy rates at month end, Operating revenues Mar 215 Mar 216 Sep % 99.% Sep % 98.4% Mar 215Sep % 96.9% Mar % Operating revenues of acquired and disposed properties (right axis) Operating revenues of 154 properties (right axis) Occupancy rares as of the end of the months Economical occupancy rates Sep % Mar % Mar % Sep % Sep % Mar 218, 99.1% Mar 218, 97.1% 1,914 2,354 2,693 2,873 3,15 3,88 3,146 3,142 5,13 5,123 5,92 5,15 5,94 5,13 5,89 5,112 JPY mn 15, 1, 5, Days Free-rent average days and grant ratios Average days Grant ratios (right axis) 42.8% 42.6% 43.7% 39.5% 4.3% 35.8% 36.8% 29.5% % 45% 4% 35% 3% 25% 2% 15% 1% 5% 9% Oct 214 Apr 215 Oct 215 Apr 216 Oct 216 Apr 217 Oct 217 Apr 218 Oct th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep 218 % Key money revenues and receiving ratios Renewal fee revenue and renewal ratios JPY mn % % 48.7% 43.2% 41.3% Key money revenues Receiving ratios (right axis) 37.4% 37.2% 36.% 6% 5% 4% JPY mn % 96.4% 97.9% 95.6% 96.1% 95.3% Renewal fee revenues Renewal ratios (right axis) 96.8% 96.3% 1% 95% % 2% % 2 85% 1% 2 18th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep 218 % 18th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep 218 8%

23 22 Rent Trend Rent Trends at Tenant Turnover Achieve a 5.1% in the increase rate (based on the number of cases) Top 3 in the increase rate by region (based on the number of cases) : 23 wards of Tokyo 8.8%, Fukuoka 7.2%, Kanto 58.9% (Excluding 23 wards of Tokyo) 1% 8% 6% 4% 2% % 22.% 25.7%28.2% 29.4%27.9%25.7% 2.8% 24.%25.6% 29.9%35.1% 19.1% 17.2%15.%16.9% 18.7% 16.8%17.9% 17.7% 18.9% 19.8% 18.3% 58.9%57.1%56.8% 53.6%53.4% 57.5% 61.3% 58.3% 55.5%5.4%46.6% 11th Sep th Mar 212 Rent Changed Units at Tenant Turnover 13th Sep th Mar th Sep th Mar th Sep th Mar th Sep 215 Rent Trends at Contract Renewal 1% 8% 6% 4% 2% % 2th Mar st Sep % 44.2% 51.5%5.1% 13.% 14.3% 13.9% 13.4% 39.9%41.5% 34.6% 36.5% 22nd Mar 217 Rent Changed Units at Contract Renewal.%.3% 99.1% 99.4% 23rd Sep 217 Increase Stay Decrease 24th Mar 218 Increase Stay Decrease 5.6% 7.% 5.6% 3.7% 3.5% 94.1% 92.9% 93.8% 96.3% 96.4%.9%.3%.3%.1%.6%.%.1% 19th 2th 21st 22nd 23rd 24th 25th Sep 215 Mar 216 Sep 216 Mar 217 Sep 217 Mar 218 Sep th Sep 218 % -5% -1% 11th Sep % 12th Mar 212 Percentage Change at Tenant Turnover 13th Sep th Mar th Sep th Mar th Sep th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep % -.6% -4.1% -3.3% -3.8% -3.8% -2.8% -3.9% -2.9% -2.3% -1.9% -1.6% -1.4% -1.7% [Change in Rent at Tenant Turnover] Previous rent Previous rent Change # of units Share Change (JPY) (JPY) (JPY) Increase % 79,732,3 81,733,264 1,943, % Stay % 18,4,8 18,4,8 - - Decrease % 46,626,851 43,758,628-2,868, %.2%.1%.% -.1% -.2% Total 1,491 1% 144,759, ,892, ,259* -.6% (Note) Calculated by excluding residential units for which prior rents are unknown due to cancellation of the sublease agreement and other factors among the newly acquired 1,52 properties, and rental units with usages other than residential. *Result in year-ago period (23th FP): JPY -2,454,288 19th Sep % Percentage Change at Contract Renewal 2th Mar 216.% 21st Sep nd Mar rd Sep 217.1%.1%.1% [Change in Rent at Contract Renewal] 24th Mar 218.% 25th Sep 218.1% Previous rent Previous rent Change # of units Share Change (JPY) (JPY) (JPY) Increase % 8,559,6 8,89,6 25, 2.9% Stay 2, % 232,141, ,141, Decrease 3.1% 382, 376, -6, -1.6% Total 2,288 1% 241,83,46 241,327,46 244,.1%

24 23 Rent Trend Average rent of move-in, 8,125 yen and move-out, 8,316 yen for the fiscal period. Average rent per tsubo of new contract rents (1,491 units) came to 8,124 yen, exceeding over the rent of the overall portfolio, 7,983 yen by 141 yen at the current fiscal period-end. The above results are mainly contributed by of an increase in rents, 8.8 %[ 291 / 36 ]of newly contracted rent in 23 wards of Tokyo during the current period. JPY/tsubo Rent per Tsubo Move-ins and Move-outs during the Period JPY/tsubo Rent Gap of the Portfolio 9, 8, 7, 6, 8,562 8,495 8,416 8,399 8,381 8,367 8,316 8,21 8,241 8,31 8,49 8,12 8,153 8,176 8,194 8,479 7,971 8,112 8,25 7,958 8,144 8,77 8,112 8,125 8,34 7,99 7,979 7,97 7,979 7,849 7,873 7,585 Average Move-in during the Fiscal Period Average Move-out during the Fiscal Period 1th 11th 12th 13th 14th 15th 16th 17th 18th 19th 2th 21st 22nd 23rd 24th 25th Mar 211Sep 211Mar 212Sep 212Mar 213Sep 213Mar 214Sep 214Mar 215Sep 215Mar 216Sep 216Mar 217Sep 217Mar 218Sep 218 8,4 8,357 8,3 8,2 8,151 8,124 8,124 8,1 8,55 8,23 8,28 8,29 8, 7,989 7,975 7,977 7,982 7,989 7,983 7,9 7,8 7,7 Contracted rent at Contracted rent at Contracted rent at Contracted rent at Contracted rent at Contracted rent at Contracted rent at the end of the period the end of the period the end of the period the end of the period the end of the period the end of the period the end of the period 19th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep 218 (Note) Calculation excludes non-residential units. Contracted rent included only contracted units (12,12 units in 25th FP )as of the each fiscal period end.

25 24 Operating Revenues, NOI and Rent per Tsubo Trends Operating Revenues and NOI Operating Revenues and NOI of 154 properties, held for 7 years since the merger with PRI. Operating revenues stays flat for 7 years (JPY 5,92 5,112 mn) despite rent per tsubo declined by 2.7% (as a result from improvement of occupancy rates and cutting downtime) NOI increased JPY 24 mn (JPY 3,714 3,96 mn) as a result from a decrease in rental expenses (NOI ratio to rental revenue improves by 4.5 points, from 72.9 % to 77.5 %) JPY mn 9, 8, 7, 6, 5, 4, 3, 5,632 5,758 5,792 5,915 5,932 6,412 6,992 7,249 5,92 5,66 5,86 5,17 5,127 5,88 5,474 5,38 5,75 5,13 5,123 4,881 5,92 5,15 5,94 5,13 5,89 5,112 4,72 4,238 4,282 4,473 4,441 3,714 3,741 3,772 3,859 3,849 3,845 3,819 3,789 3,898 3,878 3,896 3,928 3,949 3,989 3,96 11th Sep 211 Operating revenues of 154 properties Operating revenues of the portfolio NOI of 154 properties NOI of the portfolio 12th Mar th Sep th Mar th Sep th Mar th Sep th Mar 215 7,75 5,99 19th Sep 215 7,943 2th Mar 216 8,133 6,156 6,22 21st Sep 216 8,26 8,292 8,254 8,25 22nd Mar 217 6,419 6,49 6,51 6,435 23rd Sep th Mar th Sep 218 (Note) Operating revenues include rent income, common benefit revenue, parking revenue, incidental revenue, and other rental revenues. Rent per Tsubo JPY/tsubo 21/1 8,2 8,16 211/3 8,34 8, 21/1 8,17 7,8 7,6 7,4 7,2 211/3 7, /9 7, /9 7, /3 8,14 212/3 7, /9 8,57 212/9 7,91 213/3 8,5 213/3 7, /9 8,21 213/9 7, /3 8,35 214/3 7, /9 8,31 214/9 7, /3 8,36 215/3 7, /9 8, /9 7,841 Portfolio (including acquisitions/excluding dispositions) 154 properties holding since Oct /3 8,95 216/3 7,83 216/9 8,16 216/9 7, /3 8,56 217/3 7, /9 8,41 217/9 7, /3 8,63 (vs Mar 211) +.7% 218/3 7, /9 8,53 218/9 7,815 (vs Mar 211) -2.7% 7, Oct-1 Apr-11 Oct-11 Apr-12 Oct-12 Apr-13 Oct-13 Apr-14 Oct-14 Apr-15 Oct-15 Apr-16 Oct-16 Apr-17 Oct-17 Apr-18

26 25 Cost for unit repair/restoration and major exterior wall repair In order to maintain/improve property competitiveness, continued to implement value-enhancement work for units/common areas and exterior wall renovation for properties over 1 years old in addition to regular refurbishment for following tenants. Placed orders through more transparent bidding process, etc. by utilizing strength of being an independent entity Assumed total operation costs per fiscal period going forward (operating expenses + capital expenditure): Restoration/repair costs (including some exterior wall renovation): Approx. JPY.4 Capital expenditure (value-enhancement work for units/common areas, large scale exterior repair and renovation): Aim for upper limit of JPY 1. billion (Depreciation/fiscal year: Approx. JPY 1.8 billion) (Of this, future outlook for costs for major exterior wall repair and renovation: Expected to decrease to below JPY.3 billion from the 3th period after a peak of the 28th period of JPY.85 billion) JPY mn 2, 1,5 1, 5 Trend of average building age and total construction costs Repair Restoration CapEx Ave bldg age (right axis) ,468 1,241 1, Total 757 1, th Sep th Mar th Sep th Mar th Sep th Mar th Sep th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep 218 yrs JPY mn Breakdown of capital expenditures Depreciation Other 2, 1,5 1, 5 Total th Sep 211 1,49 1,86 1,84 1,13 1,16 1, th 13th 14th 15th 16th Mar 212 Sep 212 Mar 213 Sep 213 Mar 214 1, th Sep 214 1,444 18th Mar 215 1, th Sep 215 2th Mar 216 1,668 1, st Sep nd Mar 217 1,776 1,795 1,82 1, rd Sep 217 Unit renovation Exterior wall renovation th Mar 218 1, th Sep 218

27 Unit Renovation in the 25th Fiscal Period Unit Renovation(38 units Total JPY 75 million) Impact on rents through dwelling unit renovation (Average Cost :JPY 1,988 thousand) Decrease 5 Stay 3 Vacant 5 Increase 25 Breakdown of 5 units with rent decrease Rent gap: 2 units (reason is due to high rent from the previous tenants, and aging of property etc.) Change of contract conditions due to longterm vacancy: 3 units (Example) Deim Hashimoto (Sagamihara, Kanagawa) built in units Family-type residence located at 5 min walk from JR Hashimoto Station, Acquired through merger with PRI(Acquisition price JPY.74 bn, occupancy rate95.5%) Converted from a traditional Japanese-style to a westernstyle unit including elimination of room partitions Increase 25 Rent before renovation Rent after renovation Stay 3 JPY3,632,2 JPY3,766, JPY133,8 Decrease 5 (+3.7%) Vacant 5 - Japanese style Western style Building age of 25units with rent increase Under 2yar yrs 5 Over 3yrs 16 26

28 Exterior Wall Repair and Renovation in the 25th Fiscal Period 12 properties JPY86 million (spent as capital expenditures except Green Park Komatsujima as operating expense of JPY22 million) Sereno Omiya (Saitama, Saitama, Built in 1997) JPY 114 million Gala Place Shinjuku Gyoen (Shinjuku, Tokyo, Built in 27) JPY 99 million Forest Hill Sendai Aoba (Sendai, Miyagi, Built in 27) JPY 99 million Prospect Kiyosumi Teien (Koto, Tokyo, Built in 22) JPY 87 million Gran Casa Minami9jo (Sapporo, Hokkaido, Built in 26) JPY 73 million Lietcourt Yotsuya (Shinjuku, Tokyo, 26) JPY 72 million 27

29 Exterior Wall Repair and Renovation in the 25th Fiscal Period Cresidence Sapporo Minami4jo (Sapporo, Hokkaido, Built in 27) JPY 61 million Prospect Dogenzaka (Shibuya, Tokyo, Built in 25) JPY 58 million Gran Casa Minami13jo (Sapporo, Hokkaido, Built in 26) JPY 52 million willdo Kamisugi 3chome (Sendai, Miyagi, Built in 26) JPY 4 million Prospect KALON Minowa (Taito, Tokyo, Built in 27) JPY 23 million Green Park Komatsujima (Sendai, Miyagi, Built in 199) JPY 22 million 28

30 Finance Refinanced bn in June % 1.5% 1.%.5% Realized extension of borrowing periods, diversification of due dates Reduced financing costs Before refinancing 25 th (Due in June 218) 14,461JPY mn After refinancing 4,25JPY mn 4,59JPY mn 4,72JPY mn 1,JPY mn 25th(June 218 Refinance) Principle Borrowing All-in Cost (JPY mn) Period Before 14,461 5 Floating rate1.45%(note1) After 4,25 4,59 4,72 1, 6 93months 8 8 Static rate.76% Same as above.91% Same as above.94% Same as above.92% 14,461 Average 7.3 Average.88% (Note1) Total cost including the allocated costs of fixing variable interest rate and including 1M Tibor(.5364%)is 1.45% at the end of the 25th FP..% 年 1 年 2 年 3 年 4 年 5 年 6 年 7 年 8 年 9 年 1 年 Credit Ratings A+ Stable (JCR), A Stable (R&I) Trends in major financial indicators of interest-bearing debt JPY mn 15, 12, 9, 9,2 6, 3, Balance of interest bearing debt and Ratio of debt with fixed interest rates 79.5% 17,932 16,357 11,787 11,787 22nd FP Mar 217 Balance of REITbonds Balance of bank borrowings Ratio of debt with fixed interest rates (right axis) 92.3% 13,8 23rd FP Sep ,8 13,8 64.% 76.5% 24th FP Mar th FP Sep 218 1% 8% 6% 4% 55% 5% 45% 4% 51.2% 51.8% 47.3% 47.3% 22nd FP Mar 217 LTV Total assets based LTV Appraisal based LTV 23rd FP Sep % 5.9% 45.2% 24th FP Mar % 25th FP Sep 218 * Reason of declining the ratio of fixed interest rates to 64.% in 24th FP (the ratio of debt with fixed interest rates of interest-bearing debt with a maturity of over 5 years is 79.6%): Interest rate swaps, of which notional principal was 4 billion yen, under the basket method became due in January-March 218. (The swaps not attached to individual borrowings were executed at the time of collateralized borrowings 5 years ago.) With the fixing of interest rates of the above JPY 14,461 million refinancing portion, the ratio of debt with fixed interest rates has increased to 76.5% as of June 22, 218, under the policy to aim the ratio of fixed interest rate to be 8-9% for the mid to long term period. Breakdown of interest-bearing debt (as of September 3, 218) (Financing Capability to Total Assets Based LTV) 53%:Up to JPY 1. bn 55%:Up to JPY 2. bn Senshu Ikeda 5 Ashikaga 5 Kagawa 7 Nouchu 968 Hiroshima 1, Hyakugo Higashi 1, Nippon 1, NomuraTB 1,1 Bond 13,8 Mizuho 1,5 BTMU 33,678 SMBC 19,74 Total balance JPY bn ORIX 1,77 Aozora 9,843 Fukuoka DBJ 4,85 3,5 Unit: JPY mn Resona 1,469 Shinsei 1,335 29

31 JPY mn 2, 15, 1, 14,461 14,23 Refinanced 5, on June 22 (Note) 3.% 2.5% 2.% 1.5% 1.% 25th Sep % 26th Mar % 1.36% 2,.7% 1,7 1.52% 7,5 6,45 7,349 6,814 27th Sep th Mar 22 29th Sep 22 Maturity Ladder and Financial Cost (as of September 3, 218) 3th Mar 221 3,.68% 1,2 31st Sep % 3,5 32nd Mar % 9,5 33rd Sep th Mar 223 8, 35th Sep % 36th Mar %.86%.86%.91%.89% 4,25 37th Sep 224 Bank debt Bond Finance cost (right axis) 7, 7,26 The financing costs shown in above the each repayment date (the line graph) are the total of interest expenses(including base rate), finance-related costs and costs for fixing interest rates for the loans due in the respective fiscal period. The costs for fixing interest rates are allocated to the attached loans, though the costs with unattached loans are allocated to each loan in a rational way according to the status of the loan due in the respective fiscal period. The chart shown above is a floating rate before reflecting fixed interest rates which is not attached to the specific loan. (Finance costs after including fixation costs are 1.48%.) 2.8% 2.1 Average Remaining Loan Period (right axis) Finance Cost % % % 3.54 All-in Finance Costs and Average Tenor [Results] % 1.58% 1.52% % 1.33% % 38th Mar th Sep % 4,59 4th Mar % 2,5 5,72 41st Sep nd Mar 227.8% 4,6 43rd Sep 227 [Plan for next 2 years] (Note) 1.3%.99% 2.% 1.5% 1.%.5%.% 4yrs 3yrs 2yrs 1yrs.5% 14th Mar th Sep th Mar th Sep th Mar th Sep 215 2th Mar st Sep nd Mar rd Sep th Mar th Sep th Mar th Sep 219 yrs (Note) Finance costs for the 26th FP and 27th FP are preconditions for earnings forecast announced on October 15, 218. This is a target set by the Asset Manager as of November 16, 218 and is not a guaranteed amount. 3

32 31 Appraisal (as of September 3, 218) Total appraisal value of 198 properties JPY bn (+JPY 3.9 bn from end of 24th FP) Unrealized gain JPY 42.8 bn (vs. 24 th FP +JPY 4.5 bn) Appraisal Appraisal Appraisal NOI Cap Rate # of Value Value Change Properties 24th FP 25th FP 24th FP 25th FP Change (JPY million) (JPY million) Properties held since 24th FP end , , % 5.% 4.9% -.1% by Type Studio ,125 16, % 5.% 4.9% -.1% Family 69 97,4 99,85 1.7% 5.1% 5.% -.1% by Region 23 wards of central Tokyo 68 16,18 18,42 1.8% 4.6% 4.5% -.1% The 3 major metropolitan areas 93 15,22 16,92 1.6% 5.2% 5.1% -.1% Other major cities 37 44,143 44,523.9% 5.6% 5.5% -.1% JPY mn 45, 4, 35, 3, 17th FP (Sep 214) 18th FP (Mar 215) Trend of Unrealized Gain/Loss 19th FP (Sep 215) 2th FP (Mar 216) 21st FP (Sep 216) 22nd FP (Mar 217) Appraisal Value - Book Value Appraisal Value / Book Value (%) (right axis) 12% 115% 117% 118% 19% 11% 112% 16% 42,891 13% 38,363 31,627 23rd FP (Sep 217) 36,144 24th FP (Mar 218) 25th FP (Sep 218) 14% 12% 1% (Note) 71 properties were appraised by Tanizawa Sōgō Appraisal Co., Ltd., 4 properties were appraised by Daiwa Real Estate Appraisal Co.,Ltd., and 87 properties were appraised by Japan Real Estate Institute. a. Appraisal Value Increased (+JPY 1 mn - 17 mn): 156 properties Stayed: 32 properties, Decreased (-JPY 4 mn - 1 mn): 1 properties b. Cap Rate Decreased (1 bps 2bps): 148 properties Stayed: 5 properties Increased: property c. Operations Operating income: Decreased by.4% from the previous period Operating expense: Increased by.1% from the previous period NOI: Decreased by.8% from the previous period 25, 2, 15, 1, 5, 5,13 11,738 17,921 22,335 25,728 8% 6% 4% 2% %

33 32 Sustainability Initiative Adopted ESG policy for moving forward to enhancement of sustainability initiatives and improve a value of JRH in the medium to long term on August 22, ESG policy (adopted on Aug.22, 216) (published on JRH s website) Established Sustainability Promotion Committee and various rules & policies Evaluation result under the 218 GRESB Assessment (Progress management with monthly PDCA) Switch to LED lighting at common areas Introduction of energy conservation, eco-wallpaper, water-saving toilets and shower heads Introduction of earthquake-friendly vending machines and electronic breakers and postings concerning energy conservation in buildings Measurement and reduction of energy consumption, etc. of individual properties and the entire portfolio Preparation for first participation in GRESB* (July 217) DBJ Green Building Certification Green Star rating which is bestowed only to applicants that earn outstanding evaluations in terms of two operational dimensions subject to management & policy and implementation & measurement. 2-Star rating under the five-grade evaluation system that reflects global ranking based on an applicant s total scores. B rating under the five-grade GRESB Public Disclosure Level evaluation scheme for JRH s proactive information disclosure practices. Serenite Honmachi Grande Property with high environmental & social awareness (Property with 268 studio units in Osaka City, Completed in February 215 Newly acquired in June 215 Acquisition price: JPY 4.28 billion) Chijikoukanmae Tower Residence Property with excellent environmental & social awareness (Property with 141 family units in Sapporo, Completed in May 26 Acquired in October 216 Acquisition price: JPY 4.53 billion *GRESB Real Estate Assessment is an annual benchmark survey for environmental, social and governance ( ESG ) considerations in the global real estate sector, which was established in 29 primarily by major European pension fund groups which led the Principles for Responsible Investment ( PRI ). The GRESB Real Estate Assessment is distinguished by its comprehensive evaluation of sustainability efforts of real estate companies and REITs, etc., and not of individual properties. In 218, there were 93 participants globally and 61 from the Japanese market (38 J-REITs participated, a participation rate based on market cap (as of Sep. 7, 218) of 89%)

34 33 Merger of Asset Manager (dated October 1, 218) Mi-Casa Asset Management Inc. (MAM), the Asset Manager of Japan Rental Housing Investments Inc., merged with Daiwa Real Estate Asset Management Co., Ltd., which has the same parent company (Daiwa Securities Group Inc.), as of October 1, 218 for the purpose of securing and retaining professional personnel as well as expanding the information base. Daiwa Securities Group Inc. 98 1% (dated August 1, 218) 1% Mi-Casa Asset Management Inc. (absorbed company) Merger (dated October 1, 218) Daiwa Real Estate Asset Management Co. Ltd. (surviving company) ( 3 Listed REITs) (2 Unlisted REITs, Real estate funds in, etc.) Daiwa Office Investment Corporation (DOI) Nippon Healthcare Investment Corporation (NHI) Daiwa Residential Private Investment Corporation (DRP) Daiwa Hotel Private Investment Corporation (DHP) Real estate funds in forms other than investment corporations, etc. Due to the conflict of interest between JHR and DPR in terms of investment targets (residential properties) and the possibility that other private funds, etc. may invest in residential properties, arbitrary distribution of property information regarding residential properties among JRH, DRP and other private funds will be controlled to prevent conflicts of interest following the merger by establishing the Rotation Rule as described in page 35.

35 34 Overview of New Merged Company Management System of the New Merged Company for JRH MAM s Asset Management Dept.: JRH Asset Management Dept. established in the Acquisition and Asset Management Division of Daiwa Real Estate to succeed operations. MAM s Acquisition Team: JRH Investment Team established in the Acquisition Dept. of Daiwa Real Estate to succeed. operations MAM s Management Division (accounting, finance, IR, etc.): Absorbed into the organization of Daiwa Real Estate to succeed operations The Daily Occupancy Forecasting System, etc. developed at MAM is also in operation as before <as of October 1, 218> Newly established Succeeds operations such as the management of assets held by JRH during the period Newly established Succeeds operations related to the acquisition and disposal of assets of JRH Corporate-related functions of MAM (accounting, finances, IR, general affairs, personnel affairs risk management, compliance, etc.) will be succeeded by each existing department of Daiwa Real Estate Asset Management

36 35 Merger of Asset Manager (Measure to prevent conflicts of interest) New Merged Company s Rotation Rule concerning Acquisition of Rental Residential Properties New property information When completion year in western calendar is an odd number Order of priority First priority: JRH Second priority: DRP Third priority: Other Funds, etc. When completion year in western calendar is an even number Order of priority First priority: DRP Second priority: JRH Third priority: Other Funds, etc. However, the Rotation Rule shall not apply to the following cases, etc. 1 If either JRH, DRP or the Other Funds, etc. is designated by the seller or other related parties as a preferred party to discuss the acquisition. 2 3 If either JRH, DRP or the Other Funds, etc. already holds the relevant right or interest due to co-ownership, sectional ownership of a building, quasi co-ownership of a beneficiary interest, etc. If there are special reasons such as JRH, DRP or the Other Funds, etc. already owning the adjacent property. With the establishment of the Rotation Rule, JRH s acquisition opportunity will be subordinate to DRP s in the case of properties whose year (A.D.) of completion is an even number. Nevertheless, JRH is expected to comprehensively have more acquisition opportunities than before due to the effects expected which are indicated in the next page. *Regarding projects that are yet to be completed as of the beginning of considerations, the scheduled year of completion that is deemed rational at the point of consideration shall be used.

37 36 Merger of Asset Manager (Expansion of property acquisition opportunities) <Effects of Merger 1> New initiatives for development projects, expansion of information sources, etc. through the utilization of the New Merger Company s personnel resources (2 persons) in the Acquisition Department and Origination Department [Reference] Daiwa Real Estate Asset Management s recent acquisitions of rental residential properties (before merger) Acquisition since 217: 14 properties, 19.6 billion yen Cases of joint initiatives with the sponsor that may be expected Breakdown: Tokyo s 23 wards: 7 properties Chofu City, Tokyo Yokohama City, Kanagawa Kawasaki City, Kanagawa Saitama City, Saitama Funabashi City, Chiba Nagoya City, Aichi Fukuoka City, Fukuoka: 1 property each <Effects of Merger 2> Expansion of acquisition opportunities through joint initiatives with Daiwa Securities Group For projects for which the settlement schedule is extremely tight or cases in which settlement does not match the timing for acquisition sought by JRH, the acquisition may be conducted by a bridge fund and later transferred to JRH. A bridge fund may acquire a bulk project including noneligible properties and, after selling some properties to outside parties, transfer only the eligible properties to JRH. A property may be acquired by a bridge fund while it is in development and sold to JRH after stable occupancy is confirmed so that JRH does not have to bear development risk (it has been that new properties developed by third parties were acquired by JRH after their completion and after confirming the occupancy status, etc.). <Image of case 3> 譲渡 Daiwa Securities Group Seller Bridge Fund Lender After completion of development Reit Bridge Fund Equity Loan Development Developer Transactions with a range of developers outside the sponsor group is possible 譲渡

38 V. Future Growth Strategy 37

39 38 Growth Strategy (Summary) Aim to increase net profit through (1) new property acquisitions (on selective basis, given market conditions) (2) maximization of income from each property based on Management Policy by Property and (3) reduction of costs/expenses. (1) New Properties Acquisitions (Targeting AUM: JPY 25 bn) (2) Operation of properties held Maximization of income, etc. from each property (3) Cost Reduction (Reductions of BM fees, trust banks fees (by shifting the existing properties from the form of Trust Beneficiary Interest to real estate properties) and financing costs) (1) Properties with fewer competitive bidders or bilaterally negotiable transactions due to a rational reason (2) Undervalued properties (properties of which NOI can be improved in terms of rent, occupancy rate, operating expenses, etc. upon acquisition) (3) Not-for-sale properties (properties that are not on the market) (4) More utilization of the Daiwa Securities Group s information network (5) New initiatives to be a part of development projects with support of Daiwa Securities Group Acquisitions: Properties in the Tokyo metropolitan area, Sapporo, Sendai, Nagoya, Osaka and Fukuoka that are JPY 1 bn or more per property in general Dispositions: Properties in other areas than the Tokyo metropolitan area are JPY.5 bn or less per property in general (continue gradual shuffling) (Financing with Bank Loans) Maintaining and expanding relationships with existing banks (Contemplate to further reduce financing costs and extend borrowing tenors) Further increase of fixed rates borrowings Use of Bridge Facility (Secured first refusal right to acquire the subject properties ) Finance Strategy (Fund Procurement from Financial Market) Issuance of investment corporation bonds (Diversify sources of finance, improve fixed rate borrowing ratios) Public offering (Subject to LTV, amount of property acquisitions, etc.) Repurchase of own investment units (Use of JPY 6.6 billion Temporary Difference Adjustment) Payout for unitholders scheduled started from the 23rd FP based on equal amortization over 5 years (When temporary dilution and such occur in line with loss on sale of real estate*, impairment loss, one-time depreciation and capital increase, appropriation will continue to be made.) * A loss on the disposition of properties is posted; (for cases when disposition of more than one property is conducted and the total gain/loss on the disposition is in the negative (hereinafter, the net loss ), the policy is to make the appropriation to the net loss.

40 Growth Strategy (1) External Growth Expand the asset size Targeting AUM: JPY25 billion Direct acquisition by JRH as well as indirect acquisitions using the Bridge Facility Investment Criteria Profitability: Acquisition price and NOI yield after depreciation (earning capacity based on analysis of financing and JRH costs) Superiority: Location, building age and size of property Potential: Rent level and occupancy rate, volatility after passage of time (building age), supply of and demand for competing properties, location and household trends Liquidity: Past record of acquisitions and sales, price per property, and appraisal value Acquisition Policy Promote acquisition through negotiated transactions (actively avoid competitive bidding where there are a large number of participants) and independent approach methods Making use of the accumulated property information since 21, monthly flow information, independently acquired information, etc. Invest in high-quality assets in metropolises such as Tokyo (mainly in the 23 wards), Sapporo, Sendai, Osaka, Nagoya, and Fukuoka Basic benchmark for acquisitions: Studio and family apartments in the price range of over JPY1 bn per property (avoid premium rental properties) In areas other than Tokyo, the Investment Corporation will decide upon the investment amount after taking into account factors such as market size (assuming portfolio reshuffle of low-interest yield properties) Building age: Less than 1 years, in principle Average NOI yield: 5% or above, in principle Disposition Policy Strategic decision-making from the viewpoint of real estate market trends and the entire portfolio Based on analysis of profitability, local characteristics, size of property, operational efficiency, etc. Utilize reserve for temporary difference adjustment for realized losses arising from disposed properties and etc. (balance following dividend disbursement in the 23rd fiscal period (forecast): JPY 6.6 bn) Disposition based on leveraging the network and knowhow of the asset management company no. of properties Asset Size (Acquisition Price) Former JRH Former PRI (Note) Bar graph: Asset Size (Acquisition Price), Line graph: no. of properties 39

41 4 (2) Internal Growth Daily Occupancy Rate Forecasting System enable us to grasp on-the-ground conditions, engage in studying issues based on a hands-on approach, and undertake the actions outlined here in a swift manner. Improvement in Profitability Maximization of income from each property based on Management Policy by Property Challenges to raising rents and stemming the downfall, others revenue growth Improvement in product marketability as a result of upgrade of restoration Improvement of parking occupancy rates Maintaining high occupancy rates Eliminating long-term vacancies and preventing future occurrences Presales before cancellation of contract, stronger management of mockups Cutting downtime Systematic implementation of Three-Week Rule Stronger efforts on Key Focus Properties Shorten downtime ( Downtime 6 days ) Action 3 days (Focusing on the units that has been vacant for 3 days since the leasing started) Cost Reduction Review of PM companies as part of sustained efforts to reducing costs Reducing costs by obtaining volume discounts by engaging with suppliers with a countrywide presence Maintain outflows at appropriate levels by closely monitoring high-cost work orders

42 41 (3) Finance Strategy Will flexibly implement financial strategies depending on the financial condition of JRH and borrowing circumstances. Will aim to diversify financing sources by increasing the number of lenders, ongoing public offerings and issuance of investment corporation bonds. Leverage Ratio LTV (interest-bearing debt / total assets) up to 55% Debt-financing Strategy Expand the number of correspondent financial institutions based on the concept of achieving a stable bank formation Continue to reduce all-in financing costs Extend borrowing periods and diversify payment due dates Continue to issue investment corporation bonds New property acquisitions using a mix of cash (depreciation capital expenditure) and bank debt Equity-financing Strategy Investment unit price per unit shall in principle exceed net assets per unit (NAV higher than 1) Make decisions upon comprehensively considering capital market trends, impact on distributions, acquisition capacity after public offering, etc. Consider public offering taking total assets based LTV into account

43 Appendices 42

44 Medium-Term Target of Distribution per Unit (3 years from 22nd FP to 27th FP) (Released on November 15,216) Medium-term target: Aim for JPY1,9 2, DPU in the next 3 years or so Assumptions: Plan to manage securing JPY3, the upper limit for DPU increase, through the following 1. (acquisition of new properties and revenue increase from existing properties) and 2. (reduction of costs and payout of distribution reserves) Recognition of current market environment and assumptions for the next 3 years Further decline in transaction cap rates to near the level immediately before the global financial crisis Acquisition competition for new properties continuing to intensify Continuation of monetary easing policy Limited supply of newly built properties (properties in the centers of six major cities that are JPY1 bn or more) Small risk for occupancy rate fall Rent increase in some properties, but the pre-global financial crisis level not recovered yet as in Europe and the U.S. (Sep. 219) 1. Financial sources for distribution per unit + JPY1 1 Acquisition of new properties: JPY1-2 bn (distribution +about JPY7 14) 2Maximization of income, etc. from each property (Maximization of income through application of appropriate rent and minimization of downtime) 2. Financial sources for distribution per unit + JPY2 1 BM fees: Reduction of about JPY35 mn per fiscal period (distribution +about JPY2) 2 Trust fees: Reduction of about JPY65 mn over the next 3 years (distribution +about JPY4) *Promotion of actually owning real estate properties instead of holding the trust beneficiary rights to those properties from 11th fiscal period (Sep. 211). Reduced the fees by JPY48 mn from the total of JPY126 mn in 1th fiscal period to JPY78 mn in the 21st fiscal period. (To be reduced to the total of around JPY1 mn in 27th fiscal period.) 3 Financing costs: Aim for around 1% of total interest bearing debt costs in the 27th fiscal period by reducing from the actual result of the 21st fiscal period 1.47% (distribution about JPY 1 or more) *Assumption: Refinancing JPY65.4 bn due in the next 3 years (around 56% of total borrowings) at 1% (vs. actual refinancing cost of.65% for the 21st fiscal period) 4 Start of payout of distribution reserves starting in the 23rd fiscal period (distribution +about JPY4) *Assumption: Amortization of distribution reserves at the end of 22nd fiscal period over 5 years (Sep. 213) Actual JPY1,471 15th FP Annual average approx. +5% (Sep. 216) Actual JPY1,7 21st FP Annual average approx. +4% (3 years) (3 years) Target JPY1,9-2, 27th FP Medium-term target of distribution per unit is a target set by the Asset Manager as of today and is not a guaranteed amount. In addition, distribution per unit over the next 3 years from 22nd fiscal period is under assumption that there is no change to the total number of investment units issued and outstanding as of today (1,64,6 units). 43

45 44 Operating Expenses (Released on November 15, 216) 1Reduction of BM fees Plan to reduce BM fees by JPY35 mn per fiscal period utilizing strength of being a self-funding asset management company in real estate business even after the sponsor change. 2Reduction of trust fees by actually owning real estate properties instead of holding the trust beneficiary rights to those properties* For properties which were owned in form of trust beneficiary rights in 29, a basic policy to, in principle, terminate their trust agreements as each of their trust period expires and change to real estate in kind was decided. Reduction by 5% in 22nd fiscal period from the peak time immediately after the merger with PRI (JPY126 mn) and reduction to as low as JPY1 mn in 3 years expected. Current status Forecast for 22nd FP JPY277 mn After reduction Forecast for after reduction JPY242 mn -JPY35 mn (-13%) JPY mn Actual and Forecast of Trust Fees (per fiscal period) Basic policy decided Actual #of Properties Forecast Trust fee # of trust beneficiary interest th FP 8th FP 9th FP Merger with PRI 1th FP 11th FP 12th FP 13th FP 14th FP 15th FP 16th FP 17th FP 18th FP 19th FP 2th FP 21st FP 22nd FP 23rd FP 27th FP *Type of ownership of real estate is either real estate in kind or trust beneficiary rights. As to real estate in kind, payment of real estate acquisition tax, etc. arises upon acquisition (included in book value), but no trust fees are required during the ownership. On the other hand, although trust beneficiary rights are not subject to real estate acquisition tax and are subject to reduced tax rate of registration license tax upon acquisition, trust fees are required during the ownership. Therefore, ownership of trust beneficiary rights is often seen in private funds and such which do not assume long-term ownership; and for the cases of real estate investment which assume long-term ownership, comparative verification between the initial cost required for acquiring real estate in kind and the long-term cost burden required for ownership of trust beneficiary rights should be made before deciding on the policy. This is a target set by the Asset Manager as of today and is not a guaranteed amount.

46 Finance (Released on November 15, 216) JPY mn 16, 14, 12, 1, 8, 6, 4, 2, To be mature total amount of JPY 65,467 mn within next 3 years 1.18% 1.76% 11,349 1,834 22nd (Mar 217) 23rd (Sep 217) 1.47% 7,57 24th (Mar 218) 1.67% 1.5% 14,461 14,23 25th (Sep 218) 26th (Mar 219) 1.3% 1.22% 2,.91% 1.7% 7,5 6,45 6,814 1,7 27th (Sep 219) 28th (Mar 22) Maturity Ladder and Financial Cost 29th (Sep 22) 3th (Mar 221) 3,.65% 1,2 31st (Sep 221) 1.37% 3,5 32nd (Mar 222).95% 9,5 33rd (Sep 222) 34th (Mar 223) Bank debt Bond Finance Cost 1.42% 6, 35th (Sep 223) Actual amount procured in the 21st FP: JPY22.5 bn Borrowing tenor of 5.9 years at.63% 36th (Mar 224) 37th (Sep 224) 38th (Mar 225) 39th (Sep 225) 4th (Mar 226).8% 2,5 41st (Sep 226) 2.% 1.8% 1.6% 1.4% 1.2% 1.%.8%.6%.4%.2%.% (Note) 3.% 2.5% 2.% 1.5% Finance costs are the total of interest expenses, finance-related costs and costs for fixing interest rates for the loans due in the respective fiscal period. The costs for fixing interest rates are calculated by multiplying the amount of loans due in respective fiscal period by an interest rate obtained by weighted averaging the total of fixed interest rates based on each interest rate swap agreement with notional principal. 2.62% % 2.28% 2.21% % 4.9 All-in Finance Costs and Average Tenor [Results] % % % 1.59% 1.58% % % 1.34% [Plan for next 3 years] 1.28% Average Tenor 1.21% 1.14% Finance Cost Expected all-in finance costs when refinancing JPY65,467 mn due in the next 3 years (around 56% of total borrowings) at 1% 1.7% 1.4% 6yrs 5yrs 4yrs 3yrs 2yrs 1.% 1yrs (Note).5% 1th (Mar 211) 11th (Sep 211) 12th (Mar 212) 13th (Sep 212) 14th (Mar 213) 15th (Sep 213) 16th (Mar 214) 17th (Sep 214) 18th (Mar 215) 19th (Sep 215) 2th (Mar 216) 21st (Sep 216) 22nd (Mar 217) 23rd (Sep 217) 24th (Mar 218) 25th (Sep 218) 26th (Mar 219) 27th (Sep 219) Finance costs for the 22nd FP and after are estimated under a condition that the existing loans due in respective fiscal period are refinanced at 1% (total of interest expenses, financerelated costs and amortization of bond issuance costs). This is a target set by the Asset Manager as of today and is not a guaranteed amount. yrs 45

47 Lease Supply/Demand (Relocation; thousand) (Relocation; thousand) Supply/Demand Tokyo 23 words (Construction; thousand units) Relocation (In-flow) Net Relocation Populatioon Supply/Demand - Sapporo Relocation (Out-flow) New Construction Units (2) (4) (6) (Construction; thousand units) Relocation (In-flow) Relocation (Out-flow) Net Relocation Populatioon -2% (5) (1) (15) (2) (Relocation; thousand) (5) (Relocation; thousand) Supply/Demand - Nagoya Relocation (In-flow) Net Relocation Populatioon Supply/Demand - Osaka Relocation (Out-flow) New Construction Units (Construction; thousand units) (15) (25) (Construction; thousand units) Relocation (In-flow) Net Relocation Populatioon Relocation (Out-flow) New Construction Units 2 1 (1) (2) (3) (Relocation; thousand) Supply/Demand - Sendai (Construction; thousand units) Relocation (In-flow) Net Relocation Populatioon Relocation (Out-flow) New Construction Units (2) (4) (6) (8) (Relocation; thousand) Supply/Demand - Fukuoka (Construction; thousand units) Relocation (In-flow) Net Relocation Populatioon Relocation (Out-flow) New Construction Units (Source) Relocation balance: Population Movement from Basic Resident Register, MIC Construction work on new rental apartments: Survey on Construction Works by the MLIT (construction of rental units and SRC/RC apartments complexes) (5) (1) (15) (2) 46

48 47 Portfolio Overview (as of September 3, 218) ,

49 48 Portfolio Growth (Acquisition Price based) (Sponsor) [replus] [Oaktree Capital Management] Daiwa Securities Group JPY mn 3, Size of Acquired Properties Acquisitions 47 prop/jpy91.7 bn, Merger 52 prop/jpy52.9 bn, Dispositions 32 prop/jpy18.3 bn # of properties ,5 Number of Properties (right axis) Acq+3 Acq+52 Disp-1 Acq+2 Acq+2 Acq+2 Disp-6 Disp-8 Acq+2 Disp-1 Disp-1 Acq+1 Acq+4 Disp-2 Acq+3 Acq+7 Acq+8 Disp-6 2,22 2,22 Acq+1 Acq+3 Disp-5 Disp-1 Disp-1 2,259 2,232 2,255 2,255 2, AUM stayed at the same level but DPU increased by over 3% from (1) NOI yield improvement, (2)occupancy rate improvement and (3) operating cost reduction 1,819 1,895 1,972 2, ,5 1, ,19 1,19 1,19 1,54 1,53 Merger with PRI 1,498 1,539 1,538 1,569 1,562 1,562 Public Offering/Secondary Offering Public Offering/Secondary Offering Jun 26 (stock listing) Sep 26 Mar 27 Sep 27 Mar 28 Sep 28 Mar 29 Sep 29 Mar 21 Sep 21 Mar 211 Sep 211 Mar 212 Sep 212 Mar 213 Sep 213 Mar 214 Sep 214 Mar 215 Sep 215 Mar 216 Sep 216 Mar 217 Sep 217 Mar 218 Sep 218 (1st FP) (2nd FP) (3rd FP) (4th FP) (5th FP) (6th FP) (7th FP) (8th FP) (9th FP) (1th FP) (11th FP) (12th FP) (13th FP) (14th FP) (15th FP) (16th FP) (17th FP) (18th FP) (19th FP) (2th FP) (21st FP) (22nd FP) (23rd FP) (24th FP) (25th FP)

50 Portfolio (as of September 3, 218) <Geographical Allocation> <Type> Tokai 11.1% Kansai 19.1% Kanto 52.2% (including 23 wards of Tokyo 4.7%) Family 36.8% Studio 63.2% (3,634 units / Average 63.4 sq m) (9,589 units / Average 31.5 sq m) Tohoku 4.5% Kyusyu 3.8% Chugoku 1.% Hokkaido 7.5% Shinetsu.8% <Size> <Age> Over 3bn yen 26.5% Under.5bn yen 8.4%.5bn- 1bn yen 2.1% Average size JPY1,139 mn JPY 1 bn or more per property in general for the new acquisitions Over 2yrs 15.6% Under 5yrs 5-1yrs 4.1% 5.1% Average age 14.8 years Building age less than 1 years in general for the new acquisitions 15-2yrs 14.% 1-15yrs 61.2% 1bn-3bn yen 44.9% (Note) Each percentage is calculated based on the acquisition price (rounded off to one decimal place) 49

51 5 Portfolio (as of September 3, 218) Monthly Rent per Unit JPY 2K or more 3.3% JPY 15K- 2K 9.8% JPY 1K- 15K 24.7% (Note1, 2, 4) up to JPY 5K 4.3% JPY 5K-1K 57.8% 96.7% are below than JPY 2 thousand per month Corporate 28.6% Lessee Type (Note 1, 3, 4) Individual 71.4% 7-8 m2 6.7% 5-6 m2 8.6% 6-7 m2 8.2% 4-5 m2 1.7% 8 m2 or more 3.3% Unit Size (Note 1, 4) 73.1% are smaller than 5 sq meters up to 3 m2 42.% 3-4 m2 2.4% Single tenant (ML) 4.4% (Note 6) Lease Type (Note 5) Individual tenant (Pass through) 95.6% Single tenant properties are less than 4.4% Walking Distance from Stations (Note 5) 1-15min 5.4% 15min- 2.9% 5-1min 46.3% 91.7% are within 1 minutes walking distance -5min 45.4% (Note1) Calculation excludes subleased properties and non-residential units (i.e. office, retail). (Note 2) Calculation based on the total amount of monthly rent and common area fee as of March (Note 3) Calculation excludes the vacant units as of March 31, 218. (Note 4) Calculation based on the number of units (Note 5) Calculation based on the acquisition price. (Note 6) Out of 4.4% (16 buildings with a total acquisition price of JPY 1. billion), 2.8% is leased by Mainichicomnet Co., Ltd. (1 student apartments in Tokyo with a total acquisition price of JPY 6.3 billion) and the remaining 1.6% is leased by general business companies (6 buildings with a total acquisition price of JPY 3.6 billion). Since leasing an entire building to a single tenant accompanies a risk of having only one tenant, it is our policy not to newly make such investment in principle.

52 51 Portfolio Overview (as of September 3, 218) Category of Properties Number of Properties Average Acquisition Price (Thousand yen) Number of Rentable Units Average Number of Rentable Units per Property Average Rentable Floor Area per Unit (sq. meter) Studio 129 1,15,775 9, Family 69 1,21,726 3, Total (Average) 198 1,139,212 13, Category of Properties Number of Properties Average Acquisition Price (Thousand yen) Number of Rentable Units Average Number of Rentable Units per Property Average Rentable Floor Area per Unit (sq. meter) 23 wards of Tokyo 68 1,348,641 3, The three major metropolitan areas 93 1,11,429 6, Other major cities 37 1,75,5 3, Total (Average) 198 1,139,212 13, Tenant Demographics by Gender Tenant Demographics by Age Unknown 1.5% Unknown 1.8% 1's.3% Corporate 28.9% Female 28.6% Male 4.9% 9's.% 8's.2% 7's 1.1% 6's 3.4% Corporate 28.9% 5's 9.7% 4's 14.2% 2's 18.2% 3's 22.1%

53 Rent per Unit JPY 18, By Type JPY 18, By Area 15, 12, 9, , 12, 9, 6, , 3, 3, Studio Family Portfolio 23 wards of Tokyo The three major metropolitan areas Other major cities Portfolio 24th Fiscal Period Mar , ,537 98,189 24th Fiscal Period Mar ,913 9,123 73,699 98,189 25th Fiscal Period Sep , ,85 98,182 25th Fiscal Period Sep ,261 9,237 73,99 98,182 (Note) Average rent per unit calculations: rental revenue (rent + common benefit revenue) / total contracted units 52

54 53 NOI Yield (by Type and Region) By type By region 7.% 6.% % % % 5.% 4.% 4.% 3.% 24th Fiscal Period Mar th Fiscal Period Sep 218 Studio Family Portfolio 5.6% 6.4% 5.76% 5.56% 5.96% 5.71% 3.% 24th Fiscal Period Mar th Fiscal Period Sep wards of Tokyo The three major metropolitan areas Other major cities Portfolio 5.39% 5.95% 6.19% 5.76% 5.46% 5.83% 5.99% 5.71% (Note1) Number of properties: 196 in the 23rd fiscal period exclude 3 newly acquired properties (numbers of properties indicated on top of the bar graphs) (Note2) NOI yield: Annual income and expenditure in the rental business / acquisition price of property excluding tax <By size> <By building age> <By region> 4% (15) 2% Over 3bn yen 5.4% % Under.5bn (5) yen 8% 6.% 6% 5.8% 1-3bn yen (66) (# of Properties) 5.8% (67).5bn- 1bn yen (48) Over 2yrs 6% 4% 2% 6.% % Under (12) 1yrs 8% 5.3% 6.4% 15-2yrs (23) (# of Properties) 5.5% (115) 1-15yrs (3) (2) Chugoku Kyusyu 6.1% 6.% 8% Hokkaido (13) 6% Tohoku 6.% 4% 2% % (16) 5.5% (38) Kansai 6.4% 5.9% 5.5% Tokai 23wards of Tokyo (26) (68) (# of Properties) 5.8% (3) Shinetsu 6.3% Kanto (except 23wards) (29)

55 54 Financial Conditions JPY 1mn 2, 6.1% 62.4% 57.% 59.% 1,5 54.8% 49.7% 45.4% 45.% 1, Interest-bearing Debt and Total Assets LTV Interest-bearing Debt Investment Corporation Bond Appraisal LTV (right axis) Total Assets LTV (right axis) 53.1% 53.6% 52.8% 53.3% 52.9% 52.4% 51.9% 51.4% 52.1% 52.2% 52.1% 49.5% 51.3% 51.2% 51.2% 51.8% 5.9% 5.9% 51.7% 49.2% 49.5% 48.9% 47.3% 47.3% 45.2% 45.2% % 43.7% 44.% 45.3% 45.5% 48.5% 5.% 46.1% 46.1% 46.1% 7% 6% 5% 4% 3% ,4 1,55 1,135 1,79 1,79 1,63 1,17 1,17 2% 1% 4thFP 5thFP 6thFP 7thFP 8thFP 9thFP 1thFP 11thFP 12thFP 13thFP 14thFP 15thFP 16thFP 17thFP 18thFP 19thFP 2thFP 21stFP 22ndFP 23rdFP 24thFP 25thFP Mar 28Sep 28Mar 29Sep 29Mar 21Sep 21Mar 211Sep 211Mar 212Sep 212Mar 213Sep 213Mar 214Sep 214Mar 215Sep 215Mar 216Sep 216Mar 217Sep 217Mar 218Mar 218 % JPY 1mn 3, , 2,5 2, Procurement Funds Unitholders' Capital Interest-bearing Debt Interest-bearing Debt / Unitholders' Capital (right axis) ,5 1, 5 1,92 1,172 1,171 1,171 1,21 1,155 1, , ,54 1,52 1,52 1,52 1,51 1,53 1, thFP 5thFP 6thFP 7thFP 8thFP 9thFP 1thFP 11thFP 12thFP 13thFP 14thFP 15thFP 16thFP 17thFP 18thFP 19thFP 2thFP 21stFP 22ndFP 23rdFP 24thFP 25thFP Mar 28Sep 28Mar 29Sep 29Mar 21Sep 21Mar 211Sep 211Mar 212Sep 212Mar 213Sep 213Mar 214Sep 214Mar 215Sep 215Mar 216Sep 216Mar 217Sep 217Mar 218Mar

56 55 Equity Position Date Details Total Investment (JPY) Change Balance Change Total Units in Issue Number of Units October 7, 25 Private placement 1,, 1,, 2 2 December 13,25 Third-party allotment 8,9,, 9,,, 17,8 18, June 21, 26 Public offering of new equity 18,748,8, 27,748,8, 43,4 61,4 April 26, 27 Public offering of new equity 18,595,161,9 46,343,961,9 34,3 95,7 May 24, 27 Third-party allotment 963,37,341 47,37,332,241 1,777 97,477 August 28, 28 Third-party allotment 12,25,, 59,557,332,241 7, 167,477 October 2, 29 Third-party allotment 6,,119,3 65,557,451,541 65, ,34 Note Total Investment JPY 91,715,714,751 Total Number of Investment Units Authorized Total Number of Investment Units Outstanding 5,, units 1,64,6 units June 3, 21 Third-party allotment 5,,236,65 7,557,688,191 43,35 276,375 (Note1) July 1, 21 Investment unit split - 7,557,688, ,125 1,15,5 (Note2) July 1, 21 Merger - 7,557,688, ,3 1,33,8 (Note3) November 26, 213 Public offering of new equity 8,148,37,2 78,75,995, ,2 1,462, December 18, 213 Third-party allotment 811,14,36 79,517,99,751 13,6 1,475,6 May 27, 215 Public offering of new equity 12,198,615, 91,715,714, , 1,64,6 JPY Trends in NAV per Unit 95, 7,96 66,467 63,517 52,411 52,682 54,738 55,68 57,222 58,735 6,711 65, 48, ,478 7,958 (Note1) Third party allotment of new investment units done at an issue price of 116,19 yen per unit with the purpose of repaying a part of the loans that were transferred as part of the merger with PRI (Note2) Conducted a four-to-one investment unit split (Note3) The Investment Corporation conducted the absorptiontype merger with PRI treated as an extinguished corporation in accordance with article 147 of the Act on Investment Trusts and Investment Corporations 74,878 77,398 79,526 83,212 86,172 87,542 9,265 1,927 13,618 15,687 19,284 22,38 23,392 26,152 35, 7,238 53,19 53,19 53,19 53,19 53,19 53,19 53,19 53,98 53,98 53,98 55,922 55,922 55,922 55,922 55,922 55,922 55,922 5, -21,599-14,858-11,419-9,363-7,913-6,139-4,53-2,666 Unrealized gain/loss per unit Unitholders' capital per unit NAV per unit -25, 8th FP Mar 21 9th FP Sep 21 1th FP Mar th FP Sep th FP Mar th FP Sep th FP Mar th FP Sep th FP Mar th FP Sep th FP Mar th FP Sep 215 2th FP Mar st FP Sep nd FP Mar rd FP Sepr th FP Mar th FP Sep 218

57 56 Outstanding Balance and shares of interest bearing debt by Lender Lenders 9th FP 24th FP 25th FP Sep 3, 21 (Merger with PRI) Balance (JPY mn) March 31, 218 (Note1) Number of 9th FP Total includes the balance of the borrowings from 5 financial institutions which is not on the list. (Note2) Total Assets LTV = Interest-bearing Debt / Total Assets x 1 Share Balance (JPY mn) Share MUFG Bank, Ltd. 12, % 28, % Sumitomo Mitsui Banking Corporation 11, % 19, % Resona Bank, Limited 4,75 5.6% 9, % Shinsei Bank, Limited 2, % 1, % Aozora Bank, Ltd 22, % 13, % The Bank of Fukuoka, Ltd , % Development Bank of Japan Inc ,5 2.2% ORIX Bank Corporation 4.6% 2, % Mizuho Bank, Ltd % The Nomura Trust and Banking Co., Ltd % Change (JPY mn) Refinance (June 22, 218) -1,459 +6,83-4,612 +4, ,154 +3, , , , - +6 Balance (JPY mn) Share 33, % 19, % 1, % 1, % 9, % 4,85 4.2% 3,5 3.% 1,77 1.5% 1,5 1.3% 1,1 1.% THE HIGASHI-NIPPON BANK, LIMITED - - 1, 1.% - 1,.9% The Hyakugo Bank, Ltd ,.9% - 1,.9% The Hiroshima Bank, Ltd ,.9% - 1,.9% The Norinchukin Bank 4,85 6.7% 968.8% % The Kagawa Bank, Ltd % - 7.6% The Ashikaga Bank, Ltd % - 5.4% The Senshu Ikeda Bank, Ltd % - 5.4% Mitsubishi UFJ Trust and Banking -5,344 1, % 5, % Corporation Total bank borrowings (Note1) 72,225 1.% 11, % - 11, % Investment corporation bond ,8 11.9% - 13,8 11.9% Total interest bearing debt 72,225 1.% 115,587 1.% - 115,587 1.% Total assets LTV (Note2) 43.7% - 5.9% % - Appraisal LTV 53.6% % % -

58 57 Policy for Gain on Disposition and Transition of Distribution Reserve At the point of leveling distribution, the amount of distribution, distribution reserves, and distribution policy determines upon the amount of gain on sale of property (23rd FP) (24th FP) (25th FP~) Satella Nagayama Gain on disposition: JPY 3 million Record 3 million Distribution Reserve 1 Reserve equal amortization over two years (four fiscal period) from the 25th FP (7million/ fiscal period to add to distribution amount) Abreast ShinOsaka Gain on disposition: JPY 383 million 73million Distribution Record 31 million Distribution Reserve 2 Reserve equal amortization over five years (1 fiscal period) from the 24 th FP (31million/ fiscal period to add to distribution amount) Provision Reversal Distribution Period 1 Distribution Reserve(Satella Nagayama) 3 7 2years 2 Same as above (Abreast ShinOsaka) years 3 Temporary difference adjustment 6, years Total 7,6 11(Million JPY) As of the end of the 24th FP (Reference) Handling of reserve for temporary difference adjustments 5 years from 23rd FP (ended September 217) (23rd FP) Reserve for temporary difference adjustments JPY 6,733 million Equal amortization over 5 years starting from 23rd FP (Adding JPY 67 million every fiscal period) * * In cases where utilization of the reserves is judged to be rational due to occurrence of loss on disposition of properties, impairment loss and other reasons, it is possible to move up the final date (in 5 years as of present) to deal with such unexpected situations. (In such cases, the amount used will be subtracted from the balance at that point. However, the amount of depreciation for each fiscal year (JPY 67 million) will remain unchanged until the final date.) 57

59 58 Financial Indicators Item 24th (March 218) Fiscal Period 25th (September 218) Fiscal Period Reference Number of actual days of operation Return on assets (ROA) 1.4% 1.4% Ordinary income/ (Total assets at the beginning of the period + Total assets at the end of the period) / 2) x 1 (annualized) 2.8% 2.7% - Return on equity (ROE) 2.9% 2.9% Profit / ((Net assets at the beginning of the period + Net assets at the end of the period) / 2) x 1 (annualized) 5.8% 5.7% - Capital adequacy ratio as of the end of the fiscal term 47.7% 47.7% Net assets at the end of the period / Total assets at the end of the period x 1 Depreciation JPY 1,82 mn JPY 1,815 mn - Rental NOI (Net Operating Income) JPY 6,51 mn JPY 6,435 mn Rental revenues property-related expenses + depreciation FFO(Funds from Operation) per investment unit JPY 3,131 JPY 3,19 FFO (Profit + Depreciation + Amortization - Gains on sales of property + Impairment loss) / Total number of investment units outstanding as of the end of the fiscal period FFO (Funds from Operation) multiple 12.9 times 14.5 times Unit price at the end of the fiscal term / Annualized FFO per unit Debt service coverage ratio (DSCR) 11.9 times 12.8 times (Profit before interest, Depreciation and Amortization - Gain or loss of the disposition of real estate + Impairment loss) / Interest expenses Total interest-bearing debt JPY 115,587 mn JPY 115,587 mn Interest-bearing debt at the end of the period Ratio of interest-bearing debt to total assets 5.9% 5.9% (Interest-bearing debt at the end of the period / Total assets at the end of the period) x 1

60 59 Income Statements Operating revenues: 24th Fiscal Period 25th Fiscal Period From October 1, 217 From April 1, 218 to March 31, 218 to September 3, 218 Rental revenues 8,254,314 8,25,737 Gain on sales of properties 3,594 - Total operating revenues 8,284,99 8,25,737 Operating expenses: Rental expenses 3,546,23 3,63,121 Asset management fees 56, 552, Directors remuneration 6, 6,5 Asset custody fees 13,693 13,565 Administrative service fees 38,119 39,132 Audit fees 14,5 14,5 Provision for doubtful accounts 87 2,387 Write off of accounts receivable Other operating expenses 255, ,885 Total operating expenses 4,434,524 4,517,166 Operating income 3,85,384 3,733,57 Non-operating income: Interest income 5 4 Miscellaneous income 1,888 14,257 Total non-operating income 1,894 14,262 Non-operating expenses: Interest expenses 47,85 433,75 Finance-related expenses 218,63 187,67 Amortization of issuance costs of new units 2, Amortization of bond issuance costs 9,21 9,21 Other non-operating expenses 1,63 1,582 Total non-operating expenses 72, ,617 Ordinary income 3,159,14 3,115,216 Income before income taxes 3,159,14 3,115,216 Income taxes current Total income taxes Profit 3,158,499 3,114,611 Retained earnings at beginning of period Unappropriated retained earnings 3,158,89 3,115,159 24th Fiscal Period 25th Fiscal Period From October 1, 217 From April 1, 218 to March 31, 218 to September 3, 218 Breakdown of Rental Revenues and Expenses Breakdown of Rental Revenues and Expenses A. Rental revenues A. Rental revenues (Rent income) 7,8,822 (Rent income) 7,43,441 (Common service fees) 482,798 (Common service fees) 481,825 (Parking fees) 313,148 (Parking fees) 31,69 (Incidental revenues) 54,876 (Incidental revenues) 53,779 (Other rental revenues) 322,67 (Other rental revenues) 361,8 Total 8,254,314 Total 8,25,737 B. Rental expenses: B. Rental expenses: (Management fees) 428,963 (Management fees) 423,445 (Taxes and public dues) 59,549 (Taxes and public dues) 52,816 (Utilities) 156,544 (Utilities) 138,739 (Repairs) *2 344,147 (Repairs) *2 396,419 (Insurance expenses) 18,176 (Insurance expenses) 17,825 (Advertising expenses) 23,785 (Advertising expenses) 229,893 (Trust fees) 16,819 (Trust fees) 9,8 (Depreciation) 1,82,528 (Depreciation) 1,815,66 (Other rental expenses) 65,688 (Other rental expenses) 78,836 Total 3,546,23 Total 3,63,121 C. Rental income *1 4,78,111 C. Rental income *1 4,62,615 (A - B) (A - B) *1 Rental income (JPY million) 24th Fiscal Period 25th Fiscal Period NOI 6,51 NOI 6,435 *2 Repairs (JPY million) 24th Fiscal Period 25th Fiscal Period Repair cost 344 Repair cost 396 Capital expenditures 898 Capital expenditures 1,73

61 6 Balance Sheets 24th Fiscal Period 25th Fiscal Period (March 31, 218) (September 3, 218) Assets: Current assets: Cash and bank deposits *1 7,549,31 8,548,78 Cash and bank deposits in trust *1 1,259, ,191 Rental receivables 246, ,238 Prepaid expenses 343, ,531 Other current assets Allowance for doubtful accounts -9,682-8,527 Total current assets 9,389,623 9,964,168 Fixed assets: Property and equipment: *2 Buildings 97,7,517 1,17,35 Accumulated depreciation -19,38,43-21,184,271 Buildings, net 77,69,86 78,985,764 Structures 439, ,11 Accumulated depreciation -183,332-29,324 Structures, net 255, ,686 Machinery and equipment 43, ,316 Accumulated depreciation -192, ,594 Machinery and equipment, net 237, ,721 Tools, furniture and fixtures 69,24 663,313 Accumulated depreciation -344, ,156 Tools, furniture and fixtures, net 264,62 28,156 Land 74,216,361 75,415,843 Construction in progress 39,759 39,937 Buildings in trust 41,325,82 39,335,733 Accumulated depreciation -4,553,838-4,485,987 Buildings in trust, net 36,771,963 34,849,746 Structures in trust 233,613 21,368 Accumulated depreciation -71,61 67,568 Structures in trust, net 162,2 142,8 Machinery and equipment in trust 96,813 67,84 Accumulated depreciation -4,11-31,588 Machinery and equipment in trust, net 56,712 36,251 Tools, furniture and fixtures in trust 73,46 82,224 Accumulated depreciation -29,517-33,716 Tools, furniture and fixtures in trust, net 43,889 48,57 Land in trust 26,915,191 25,768,414 Construction in progress in trust 6,623 5,77 Total property and equipment 216,66, ,74,539 Intangible assets: Leasehold for land 546, ,283 Right of using water facilities Trademark rights Total intangible assets 546, ,737 24th Fiscal Period 25th Fiscal Period (March 31, 218) (September 3, 218) Investments and other assets: Guaranteed securities deposited 9,916 9,972 Lease deposits Long-term prepaid expenses 465, ,364 Reserve fund for repair 133, ,482 Total investments and other assets 69,82 639,561 Total fixed assets 217,816, ,26,838 Deferred assets: Issuance costs of new units Bond issuance costs 89,993 8,791 Total deferred assets 9,45 8,791 Total assets 227,296, ,35,798 (JPY million) *1 Cash and deposits 24th Fiscal Period 25th Fiscal Period Cash and bank deposits 7,549 8,548 Cash and bank deposits in trust 1, Total 8,88 9,53 Leasehold and security deposits received 1,246 1,258 Leasehold and security deposits received in trust Balance 7,96 7,817 *2 Property and equipment 24th Fiscal Period 25th Fiscal Period Total acquisition price JPY 225,564 mn JPY 225,564 mn *3 Interest bearing debt 25th Fiscal Period Liabilities: Balance of interest bearing debt JPY 115,587 mn Current liabilities: Accounts payable 573, ,785 *4 Unitholders capital (JPY million) Current portion of long-term debt *3 28,664,66 21,253, (1) 1/7/25 Establishment through private 1 Other accounts payable 32,824 28,29 placement (2) 12/13/25 Third-party allotment 8,9 Accrued expenses 433,22 423,72 (3) 6/21/26 IPO 18,748 Income taxes payable (4) 4/26/27 PO 18,595 Consumption taxes payable 13,923 1,664 (5) 5/24/27 Third-party allotment 963 Rents received in advance 393, ,762 (6) 8/28/28 Third-party allotment 12,25 Other current liabilities 16,442 16,119 (7) 1/2/29 Third-party allotment 6, (8) 21/6/3 Third-party allotment 5, Total current liabilities 3,128,923 22,863,866 (9) 11/26/213 PO 8,148 Long-term liabilities: (1) 12/18/213 Third-party allotment 811 Bonds 13,8, 13,8, (11) 5/27/215 PO 12,198 Long-term loans *3 73,123, 8,534, 25th Fiscal Period end 91,715 Leasehold and security deposits received *1 1,246,747 1,258,986 Leasehold and security deposits received in trust *1 465,53 427,618 Derivatives liabilities 96,767 52,226 Total long-term liabilities 88,732,46 96,72,831 Total liabilities 118,86, ,936,698 Net assets: Unitholders equity: Unitholders capital *4 91,715,714 91,715,714 Surplus: Capital surplus 6,682,398 6,682,398 Voluntary reserves Distribution reserves 31, 39,594 Reserve for adjustment of temporary differences 6,665,79 6,598,459 Total discretionary reserves 6,975,79 6,98,54 Retained earnings 3,158,89 3,115,159 Total surplus 16,816,998 16,75,611 Total unitholders equity 18,532,713 18,421,326 Valuation and translation adjustments Deferred gains or losses on hedges -96,767-52,226 Total valuation and translation adjustments -96,767-52,226 Total net assets 18,435,945 18,369,1 Total liabilities and net assets 227,296, ,35,798

62 61 Cash Flow Statements Cash flows from operating activities: 24th Fiscal Period 25th Fiscal Period From October 1, 217 From April 1, 218 to March 31, 218 to September 3, 218 Income before income taxes 3,159,14 3,115,216 Depreciation 1,82,528 1,815,66 Amortization of long-term prepaid expenses 193, ,841 Amortization of bond issuance costs 9,21 9,21 Amortization of issuance costs of new units 2, Interest income -5-4 Interest expenses 47,85 433,75 Increase (Decrease) in allowance for doubtful accounts -4,64-1,155 Decrease (Increase) in rental receivables -52,884 23,538 Decrease (Increase) in prepaid expenses 4,321 53,534 Increase (Decrease) in accounts payable 4,272-44,319 Increase (Decrease) in other accounts payable -28,514-12,259 Decrease (Increase) in consumption taxes payable -3,764-4,548 Increase (Decrease) in accrued expenses -21,39-96 Increase (Decrease) in rents received in advance -57,85-27,92 Decrease from sales of property and equipment 324,956 - Long-term prepaid expenses paid -28, ,477 Other - net -9,992-11,942 Sub-total 5,8,76 5,371,46 Interest received 5 4 Interest paid -471, ,325 Income taxes paid Net cash provided by operating activities 5,327,693 4,928,12 Cash flows from investing activities: 24th Fiscal Period 25th Fiscal Period From October 1, 217 From April 1, 218 to March 31, 218 to September 3, 218 Purchase of property and equipment -98,835-96,23 Purchase of property and equipment in trust -183,184-74,754 Net increase (decrease) in leasehold and security deposits received Net increase (decrease) in leasehold and security deposits received in trust 84,264 12,239-19,712-37,912 Cash used in investing activities -1,117,468-1,6,45 Cash flows from financing activities: Proceeds from long-term loans 3,, 14,461, Repayment of long-term loans -7,57, -14,461,66 Proceeds from issuance of bonds - - Payments for bond issuance costs - - Dividends paid -3,149,136-3,226,64 Net cash provided by (used in) financing activities -7,719,136-3,226,724 Net increase (decrease) in cash and cash equivalents -3,58, ,944 Cash and cash equivalents at beginning of period 12,317,866 8,88,954 Cash and cash equivalents at end of period 8,88,954 9,53,899

63 62 List of Properties (as of September 3, 218) Studio Property No. Property Name Area Constructed Total Number of Rentable Unit Total Rentable Floor Space (square meters) Occupancy Rate (Sep 3, 218) (1) Acquisition Price (2) Book Value 25th fiscal period end (3) Appraisal value 24th fiscal period (4) Appraisal value 25th fiscal period (4) - (3) (4) - (1) (4) - (2) Appraiser O-1-1 Satella Kita 34jo Sapporo city, Hokkaido Sep , % 1,133,714 1,2,3 1,19, 1,21, 2, 76, ,996 1 O-1-32 willdo Kita 24jo Sapporo city, Hokkaido Feb , % 316, 272,31 255, 259, 4, -57, -13,31 3 O-1-34 Gran Casa Minami13jo Sapporo city, Hokkaido Jan , % 463, 46, , 398, 2, -65, -62,973 3 O-1-35 Gran Casa Minami9jo Sapporo city, Hokkaido Oct , % 533, 534, , 451, 5, -82, -83,552 3 O-1-9 Sky Hills N15 Sapporo city, Hokkaido Mar , % 712, 762, , 97, 17, 258, 27,345 1 O-1-91 Sky Hills Sakaemachi Chitose city, Hokkaido Feb , % 832, 877, , 964, 17, 132, 86,817 1 O-1-92 Dormy Chitose Chitose city, Hokkaido Mar , % 476, 485, , 55, 7, 29, 19,177 1 O-1-93 Sky Hills Takadai I Chitose city, Hokkaido Jan , % 448, 448, , 51, 11, 62, 61,186 1 O Alpha Tower Sapporo Minami4jo Sapporo city, Hokkaido Apr , % 1,185, 1,126,735 1,39, 1,39, 25, 263,264 3 O Cresidence Sapporo Minami4jo Sapporo city, Hokkaido Sep , % 1,14, 1,16,561 1,33, 1,29, -4, 15, 129,438 3 O Gran Casa NagayamaKoen Dori Sapporo city, Hokkaido Jan , % 1,2, 1,66,713 1,3, 1,3, 28, -36,713 3 O Gran Casa Minami11jo Sapporo city, Hokkaido Apr , % 83, 896, , 868, 16, 38, -28,415 3 O-2-37 willdo Nishishitadaicho Morioka city, Iwate May ,34. 1.% 512, 467, , 573, 24, 61, 15,738 3 O-2-54 willdo Kamisugi 3chome Sendai city, Miyagi Mar , % 56, 468, , 553, 4, 47, 84,136 2 O-2-65 Grandmaison Shichifuku Sendai city, Miyagi Feb , % 342, 332, , 294, 1, -48, -38,132 2 O-2-94 Living Stage Higashi-Sendai Sendai city, Miyagi Jul , % 317,2 289, , 359, -9, 41,8 69,318 2 O West Park Hasekura Sendai city, Miyagi Mar , % 1,24, 1,18,451 1,92, 1,91, -1, 67, 729,548 3 O Forest Hill SendaiAoba Sendai city, Miyagi Mar , % 2,75, 2,825,711 3,3, 3,, -3, 25, 174,288 2 O-2-14 Gran Casa Sendai Itsutsubashi Sendai city, Miyagi Nov , % 2,1, 2,15,296 2,18, 2,18, 8, 74,73 2 O-3-79 willdo Ishizuecho Niigata city, Niigata Feb , % 462,51 383, , 47, -4, 7,489 86,681 3 O-3-8 willdo Sasaguchi Niigata city, Niigata Feb ,8. 1.% 266, 228, , 27, -5, 4, 41,548 3 O-4-5 willdo Koshigaya Koshigaya city, Saitama Apr , % 499, , , 564, 13, 64, ,816 1 O-4-6 Joyful Sayama Sayama city, Saitama Jul % 216,619 24,473 21, 2, -1, -16,619-4,473 1 O-4-7 Lumiere Hachioji Hachioji city, Tokyo Mar , % 48, , , 42, -2, -6,761-29,579 1 O-4-8 willdo Kiyosumi Koto ku, Tokyo Dec , % 5,24,619 4,653,235 6,12, 6,25, 13, 1,225,38 1,596,764 3 O-4-9 Turkey's Denenchofu No.2 Ota ku, Tokyo Feb % 281, , , 328, 6, 46,476 56,736 1 O-4-1 willdo HonChiba Chiba city, Chiba Oct , % 379, ,571 42, 427, 7, 47,142 68,428 1 O-4-11 willdo Yokohama Minami Yokohama city, Kanagawa Feb % 233,142 21, , 275, 7, 41,857 73,431 1 O-4-12 Site Pia Sagamihara city, Kanagawa Oct , % 56, ,18 486, 487, 1, -19,142-1,18 3 O-4-24 VISTA Supreme Machida city, Tokyo Mar % 563,584 57, , 484, 1, -79,584-23,452 3 O-4-25 Joy Oyamadai Setagaya ku, Tokyo Jul , % 624, ,6 617, 632, 15, 7,734-64,6 3 O-4-31 willdo Otsuka Toshima ku, Tokyo Mar , % 725, , , 698, -27,229-29,789 3 O-4-38 willdo Niiza Niiza city, Saitama Nov , % 59, ,7 565, 57, 5, -2,438 54,299 3 O-4-39 Toshin Shoto Mansion Shibuya ku, Tokyo Jun , % 912, 962, , 95, 18, 38, -12,754 3 O-4-55 Harmony Kamikitazawa Setagaya ku, Tokyo Feb % 4, 396,88 333, 342, 9, -58, -54,88 3 O-4-62 willdo Minami Urawa Saitama city, Saitama Mar % 396, 359,22 417, 426, 9, 3, 66,797 3 O-4-69 College Square KitaIkebukuro Itabashi ku, Tokyo Feb ,65. 1.% 727, 652,51 782, 783, 1, 56, 13,489 2 O-4-7 College Square TobuNerima Itabashi ku, Tokyo Oct , % 892, 824, , 96, 1, 68, 135,161 2 O-4-71 College Square Akatsuka Nerima ku, Tokyo Mar , % 734, 658, , 781, 47, 122,851 2 O-4-72 College Square Higashikurume HigashiKurume city, Tokyo Sep % 523, 445, , 597, 13, 74, 151,881 1 O-4-73 College Square Waseda II Toshima ku, Tokyo Jul % 215, 195, 28, 28, 65, 84,999 2 O-4-74 College Square Myogadani Bunkyo ku, Tokyo Mar , % 1,6, 969,146 1,27, 1,3, 3, 24, 33,853 1 O-4-75 College Square Shinkoiwa Katsushika ku, Tokyo Mar , % 724, 65, , 767, 43, 116,763 2 O-4-76 College Square Kiba Koto ku, Tokyo Nov % 639, 575,97 751, 751, 112, 175,92 1 O-4-77 College Square Kinshicho Koto ku, Tokyo Mar % 49, 438, , 551, 14, 61, 112,772 1 O-4-78 College Square Waseda Shinjuku ku, Tokyo Mar % 316, 34, , 353, 9, 37, 48,132 1 O-4-89 Lexington Square ShinjukuGyoen Shinjuku ku, Tokyo Aug , % 1,1, 1,43,543 1,28, 1,28, 27, 236,456 2 O-4-95 Prospect NihonbashiHoncho Chuo ku, Tokyo Nov , % 88, 777,884 1,13, 1,15, 2, 342, 372,115 3 O-4-96 Maison de Ville Takanawa Gyoranzaka Minato ku, Tokyo Mar , % 1,48, 1,437,72 1,75, 1,75, 27, 312,297 3 O-4-97 Roppongi Rise House Minato ku, Tokyo Mar , % 912, 882,434 1,1, 1,12, 2, 28, 237,565 3 (Note) In column of "Appraiser", representation of "1" is for Tanizawa Sōgō Appraisal Co., Ltd., "2" for Daiwa Real Estate Appraisal Co.,Ltd., "3" for Japan Real Estate Institute.

64 63 Studio Property No. Property Name Area Constructed Total Number of Rentable Unit Total Rentable Floor Space (square meters) Occupancy Rate (Sep 3, 218) (1) Acquisition Price (2) Book Value 25th fiscal period end (3) Appraisal value 24th fiscal period (4) Appraisal value 25th fiscal period (4) - (3) (4) - (1) (4) - (2) Appraiser O-4-98 TK Flats Shibuya Shibuya ku, Tokyo Nov , % 4,77, 4,552,596 5,73, 5,9, 17, 1,13, 1,347,43 3 O-4-99 Maison de Ville NakaMeguro Meguro ku, Tokyo Feb , % 1,5, 1,8,442 1,34, 1,36, 2, 31, 351,557 3 O-4-1 Prospect KALON Minowa Taito ku, Tokyo Feb , % 1,62, 1,457,913 2,, 2,4, 4, 42, 582,86 3 O-4-11 Prospect Shinonomebashi Koto ku, Tokyo Mar , % 3,4, 2,85,69 3,96, 3,96, 92, 1,19,39 3 O-4-12 Prospect Monzennakacho Koto ku, Tokyo Jan , % 1,8, 1,17,176 1,39, 1,39, 31, 372,823 2 O-4-13 Prospect Ogikubo Suginami ku, Tokyo Feb , % 71, 648, , 92, 35, 21, 253,827 2 O-4-14 Exceria Ikebukuro West II Toshima ku, Tokyo Sep , % 852, 844,33 1,4, 1,4, 188, 195,696 2 O-4-15 Prospect OmoriKaigan Ota ku, Tokyo Feb , % 1,48, 1,392,812 1,94, 1,98, 4, 5, 587,187 3 O-4-16 Prospect MusashiShinjo Kawasaki city, Kanagawa May , % 1,5, 948,787 1,27, 1,27, 22, 321,212 2 O-4-17 Fragrance Kawasaki Kawasaki city, Kanagawa Sep , % 548,9 489, , 686, 12, 137,1 196,766 3 O-4-18 Prospect ChuoRinkan Yamato city, Kanagawa May , % 524, 45, , 65, 1, 126, 199,485 2 O-4-12 Gala Place Shinjuku Gyoen Shinjuku ku, Tokyo Feb , % 2,17, 2,193,86 2,9, 3,1, 11, 84, 816,913 1 O Joyce Court Ota ku, Tokyo Nov , % 3,1, 2,912,511 3,83, 3,91, 8, 9, 997,488 3 O Act Forme Asakusa Taito ku, Tokyo Oct , % 1,216, 1,183,677 1,76, 1,83, 7, 614, 646,322 1 O Gran Casa Roppongi Minato ku, Tokyo Mar , % 1,48,88 766,55 881, 891, 1, -589,88 124,944 2 O Gran Casa MinamiAoyama Minato ku, Tokyo Oct , % 3,75, 2,32,455 2,12, 2,13, 1, -1,62, -19,455 2 O Storia Jingumae Shibuya ku, Tokyo Nov , % 3,16, 3,25,954 2,49, 2,5, 1, -66, -75,954 2 O Gran Casa Shinjuku Gyoen Shinjuku ku, Tokyo Feb , % 2,525, 2,568,344 3,31, 3,38, 7, 855, 811,655 1 O Lietocourt Yotsuya Shinjuku ku, Tokyo Jan , % 1,716,8 1,77,76 2,14, 2,18, 4, 463,2 49,239 3 O Lietocourt Motoakasaka Minato ku, Tokyo Apr , % 1,95,7 1,85,732 1,39, 1,42, 3, 324,3 334,267 3 O Gran Casa Ginza East Chuo ku, Tokyo Feb , % 2,, 2,87,42 2,19, 2,25, 6, 25, 162,957 3 O Gran Casa Minowa Taito ku, Tokyo Sep , % 85, 894,83 888, 898, 1, 48, 3,916 3 O-5-13 willdo Kanayama masaki Nagoya city, Aichi Feb , % 49,95 418,226 58, 581, 1, 9,94 162,773 3 O-5-26 Excelsior Sakae Nagoya city, Aichi Mar , % 641,767 62,843 53, 531, 1, -11,767-71,843 3 O-5-27 willdo Hibino Nagoya city, Aichi Jan % 317,63 275, , 299, 1, -18,63 23,242 3 O-5-4 willdo Chiyoda Nagoya city, Aichi Jul , % 633, 539, , 626, 11, -7, 86,517 2 O-5-41 willdo Taiko dori Nagoya city, Aichi Aug , % 1,12, 958,36 1,24, 1,28, 4, 16, 321,963 1 O-5-42 willdo Kanayama Nagoya city, Aichi Sep % 37, 321,61 4, 417, 17, 47, 95,938 2 O-5-43 willdo Kanayama sawashita Nagoya city, Aichi Jan % 375, 322, , 431, 13, 56, 18,116 2 O-5-56 willdo Kachigawa Kasugai city, Aichi Feb , % 53, 426,21 648, 675, 27, 172, 248,789 1 O-5-57 Stagea Kogane Nagoya city, Aichi Feb , % 6, 515, , 574, 6, -26, 58,628 3 O-5-63 willdo Inaei Nagoya city, Aichi Mar , % 641, 552, , 636, 1, -5, 83,817 2 O-5-66 willdo Higashibetsuin Nagoya city, Aichi Jun , % 73, 66,12 72, 725, 5, 22, 118,987 3 O-5-81 willdo Matsubara Nagoya city, Aichi Aug , % 549, 479, , 566, 1, 17, 86,117 3 O-5-82 willdo Yokkaichi Unomori Yokkaichi city, Mie Sep ,16. 1.% 529,15 44, , 582, 52,85 141,25 3 O-5-86 willdo Daikancho Nagoya city, Aichi Mar , % 655, 57, , 643, 2, -12, 72,41 3 O-5-88 willdo Takabata Nagoya city, Aichi Mar , % 494, ,63 511, 516, 5, 21,884 94,936 3 O Sakura Hills Riverside WEST Nagoya city, Aichi Nov , % 1,92, 1,987,491 2,23, 2,27, 4, 35, 282,58 1 O Sakura Hills Riverside EAST Nagoya city, Aichi Nov , % 1,3, 1,64,931 1,2, 1,22, 2, 19, 155,68 1 O Sakura Hills Meieki NORTH Nagoya city, Aichi Nov , % 75, 781, , 887, 22, 137, 15,81 1 O-6-14 willdo Ichioka Osaka city, Osaka Feb , % 722, , , 678, 2, -44,761 56,615 3 O-6-15 willdo Ebie Osaka city, Osaka Feb % 35,94 33, , 343, -7,94 39,768 3 O-6-16 willdo ImafukuNishi Osaka city, Osaka Oct , % 413,857 36, , 386, 8, -27,857 25,21 1 O-6-17 Maison Flora Kobe city, Hyogo Jun , % 584, , , 494, 1, -9,285-75,151 3 O-6-46 willdo Tsukamoto Osaka city, Osaka Mar , % 73, 634, , 795, 17, 65, 16,41 1 O-6-47 willdo Temmabashi Osaka city, Osaka Sep % 338, 299, , 316, 5, -22, 16,133 1 O-6-48 willdo SakaisujiHommachi Osaka city, Osaka Sep % 325, 285, , 268, 2, -57, -17,176 1 O-6-49 willdo Tanimachi Osaka city, Osaka Jan , % 1,4, 953, , 98, 19, -132, -45,317 3 O-6-5 willdo Namba w II Osaka city, Osaka Mar , % 486, 439, , 449, 12, -37, 9,785 1 O-6-51 willdo Namba w I Osaka city, Osaka Aug , % 69, 66,22 624, 638, 14, -52, 31,977 1

65 64 Studio Property No. Property Name Area Constructed Total Number of Rentable Unit Total Rentable Floor Space (square meters) Occupancy Rate (Sep 3, 218) (1) Acquisition Price (2) Book Value 25th fiscal period end (3) Appraisal value 24th fiscal period (4) Appraisal value 25th fiscal period (4) - (3) (4) - (1) (4) - (2) Appraiser O-6-59 willdo Hamasaki dori Kobe city, Hyogo Feb , % 2,28, 2,6,147 2,26, 2,26, -2, 253,852 2 O-6-6 willdo Minamimorimachi Osaka city, Osaka Mar , % 493, 45,37 482, 492, 1, -1, 41,962 1 O-6-64 willdo Matsuyamachi Osaka city, Osaka Apr , % 81, 72, , 84, 8, 3, 137,377 3 O-6-67 willdo ShinOsaka Osaka city, Osaka Jun , % 861, 75, , 997, 9, 136, 246,518 1 O-6-83 willdo Sannomiya East Kobe city, Hyogo Aug , % 731, 61,41 765, 777, 12, 46, 166,589 3 O-6-85 willdo Kujo Osaka city, Osaka Feb , % 537, 51, , 577, 9, 4, 66,72 3 O Abreast Sakuragawa Osaka city, Osaka Aug , % 385,8 347, , 489, 13, 13,2 141,686 3 O Prospect Bishoen Osaka city, Osaka Oct % 277, 252, , 317, 3, 4, 64,557 3 O Prospect Nakanoshima Osaka city, Osaka Aug , % 734, 643, , 887, 12, 153, 243,153 1 O Prospect Toyonaka Hattori Toyonaka city, Osaka Dec % 366, 317,214 48, 415, 7, 49, 97,785 3 O Prospect Shimogamo Kyoto city, Kyoto Feb % 281, 256, , 294, 13, 37,41 2 O Prospect Kawaramachi Gojo Kyoto city, Kyoto Jan , % 583, 526, , 697, 1, 114, 17,47 2 O Gransys Esaka Suita city, Osaka Feb , % 1,26, 1,24,459 1,71, 1,72, 1, 46, 515,54 1 O Serenite Koshien Nishinomiya city, Hyogo Feb , % 2,55, 2,46,75 2,78, 2,84, 6, 29, 379,924 3 O Pregio Miyakojima Osaka city, Osaka Mar , % 1,61, 1,637,117 1,79, 1,79, 18, 152,882 3 O Serenite ShinOsaka Nibankan Osaka city, Osaka Jan , % 3,51, 3,592,11 3,71, 3,75, 4, 24, 157,889 1 O Gran Casa UmedaKita Osaka city, Osaka Nov , % 2,5, 2,57,992 2,26, 2,29, 3, 24, 232,7 1 O Serenite Honmachi Grande Osaka city, Osaka Feb , % 4,286, 4,296,921 5,12, 5,26, 14, 974, 963,78 3 O Gransys Tenmabashi Osaka city, Osaka May , % 4,5, 4,17,166 4,41, 4,52, 11, 47, 412,833 3 O DayGran Tsurumi Osaka city, Osaka Mar , % 1,3, 1,58,75 1,12, 1,14, 2, 11, 81,249 3 O-6-15 Runai Nippombashi anhelo Osaka city, Osaka Feb , % 1,4, 1,453,961 1,61, 1,63, 2, 23, 176,38 1 O HS Umeda EAST Osaka city, Osaka Feb , % 2,151, 2,237,878 2,34, 2,34, 189, 12,121 3 O Serenite Umeda EST Osaka city, Osaka Feb , % 1,57, 1,16,974 1,13, 1,14, 1, 83, 33,25 3 O Serenite Yuhigaoka EST Osaka city, Osaka Feb , % 811,5 847,74 869, 869, 57,5 21,259 3 O-7-68 willdo Okayamaeki Nishiguchi Okayama city, Okayama Sep , % 1,22, 1,7,724 1,29, 1,34, 5, 12, 332,275 1 O-7-87 willdo Okayamadaiku Okayama city, Okayama Mar , % 1,4, 943,429 1,18, 1,23, 5, 19, 286,57 1 O-9-53 willdo Nakasu Fukuoka city, Fukuoka Jan , % 2,46, 2,235,148 2,53, 2,53, 7, 294,851 3 O-9-13 Renaissance 21 Hakata Fukuoka city, Fukuoka Mar , % 1,5, 1,493,766 1,72, 1,76, 4, 26, 266,233 3 O Granpark Tenjin Fukuoka city, Fukuoka Feb , % 4,698, 4,574,67 5,86, 5,95, 9, 1,252, 1,375,392 3 Studio type subtotal 9,589 32, % 142,644, ,171, ,125, 16,382, 2,257, 17,737,8 25,21,317 -

66 65 Family Property No. Property Name Area Constructed Total Number of Rentable Unit Total Rentable Floor Space (square meters) Occupancy Rate (Sep 3, 218) (1) Acquisition Price (2) Book Value 25th fiscal period end (3) Appraisal value 24th fiscal period (4) Appraisal value 25th fiscal period (4) - (3) (4) - (1) (4) - (2) Appraiser F-1-41 Palais d'or Maruyama Sapporo city, Hokkaido Nov , % 559, 61, , 994, 17, 435, 392,87 1 F-1-69 Gran Casa Urasando Sapporo city, Hokkaido Feb , % 1,51, 1,547,731 1,75, 1,76, 1, 25, 212,268 1 F-1-7 Gran Casa Kita3jo Sapporo city, Hokkaido Jan , % 1,265,88 1,353,382 1,46, 1,48, 2, 214,12 126,617 3 F-1-75 Chijikoukanmae Tower Residence Sapporo city, Hokkaido May , % 4,53, 4,78,35 4,75, 4,8, 5, 27, 91,964 3 F-2-1 Royal Garden Shinrin Koen Sendai city, Miyagi Aug , % 396,19 364,873 28, 28, -116,19-84,873 2 F-2-2 Green Park Komatsujima Sendai city, Miyagi Oct , % 55, ,34 413, 413, -137,523-81,34 2 F-2-3 Dia Palace Izumizaki Sendai city, Miyagi Jul , % 355,95 363,18 317, 316, -1, -39,95-47,18 2 F-2-4 willdo Takasago Sendai city, Miyagi Jun , % 364,94 362, , 389, 4, 24,95 26,42 3 F-2-42 Living Stage MinamiSendai Sendai city, Miyagi Apr , % 159,5 148,35 232, 232, 72,5 83,964 2 F-2-43 Takasagoseki Nibankan Sendai city, Miyagi Feb , % 558, 556, , 748, 21, 19, 191,831 3 F-3-34 Ark Heim Niigata Niigata city, Niigata Nov , % 1,6, 1,3, , 847, -1, -213, -183,677 3 F-4-5 Johanna Mansion Maebashi city, Gunma Feb , % 556, ,5 349, 353, 4, -23, ,5 1 F-4-6 Iruma Ekimae Building Iruma city, Saitama Mar , % 1,517, 1,576,972 1,71, 1,74, 3, 223, 163,27 1 F-4-7 Iruma Ekimae Building No.II Iruma city, Saitama Mar , % 687,666 77,16 649, 657, 8, -3, ,16 1 F-4-8 Sereno Omiya Saitama city, Saitama Nov , % 1,554,523 1,677,343 1,87, 1,91, 4, 355, ,656 1 F-4-9 Suzuran-kan Saitama city, Saitama Mar 2 2 1, % 441,19 42, , 567, 1, 125,89 164,641 1 F-4-1 Bonheur Tokiwa Saitama city, Saitama Feb , % 752,94 735,13 745, 759, 14, 6,95 23,986 3 F-4-11 Profit Link Takenotsuka Adachi ku, Tokyo Feb , % 636, , , 693, 14, 56,666 59,311 1 F-4-13 Dream Heights Itabashi ku, Tokyo Oct , % 358, , , 445, 1, 86,333 56,645 1 F-4-14 Green Hills Asukayama Kita ku, Tokyo Feb , % 587, , , 688, 15, 1, ,43 1 F-4-15 Oji Heights Kita ku, Tokyo Nov % 347, , , 477, 8, 129, ,271 1 F-4-16 Sakagami Royal Heights No. II Arakawa ku, Tokyo Oct , % 36, , , 458, 9, 97,285 15,14 1 F-4-17 willdo Todoroki Setagaya ku, Tokyo Oct , % 1,764,89 1,788,73 1,69, 1,72, 3, -44,89-68,73 3 F-4-18 Chez Moi Sakuragaoka Tama city, Tokyo Mar , % 69,94 624, , 633, 2, 23,95 8,647 1 F-4-19 Libest NishiChiba Chiba city, Chiba Feb , % 2,152,476 1,98,77 2,48, 2,53, 5, 377, ,292 1 F-4-2 Corinne Tsudanuma Narashino city, Chiba Mar , % 352, , , 345, 1, -7,761-22,328 3 F-4-22 Chigasaki Daikan Plaza Chigasaki city, Kanagawa Sep , % 453, , , 479, 1, 25,428 15,152 1 F-4-28 Winbell Chorus Hiratsuka No.13 Hiratsuka city, Kanagawa Dec , % 477, , , 346, 3, -131, ,551 3 F-4-29 Libest Higashi Nakayama Funabashi city, Chiba Feb , % 1,371,314 1,236,682 1,66, 1,69, 3, 318, ,317 1 F-4-31 MGA Kanamachi Katsushika ku, Tokyo Sep , % 484, 49, , 421, 3, -63, -69,335 3 F-4-35 Greenhills Roka Setagaya ku, Tokyo Mar , % 662, 693, , 728, 13, 66, 34,647 1 F-4-36 Lofty Hirai Edogawa ku, Tokyo May % 324, 317,52 34, 348, 8, 24, 3,479 1 F-4-38 Colonnade Kasuga Bunkyo ku, Tokyo Jul , % 3,115,277 3,196,595 2,56, 2,57, 1, -545, ,595 2 F-4-39 The Palms Yoyogi Uehara Cosmo Terrace Shibuya ku, Tokyo Nov , % 1,25, 1,278,817 1,49, 1,49, 24, 211,182 2 F-4-4 Sun Terrace Yoyogi Uehara Shibuya ku, Tokyo Feb , % 1,18, 1,221,829 1,53, 1,53, 35, 38,17 2 F-4-44 Prospect NihombashiKoamicho Chuo ku, Tokyo Mar , % 84, 739,28 1,16, 1,2, 4, 36, 46,971 1 F-4-45 Park Terrace Ebisu Shibuya ku, Tokyo Oct , % 2,6, 2,41,232 2,82, 2,9, 8, 84, 858,767 1 F-4-46 Prospect Dogenzaka Shibuya ku, Tokyo Feb , % 1,59, 1,587,13 2,7, 2,13, 6, 54, 542,869 3 F-4-47 Prospect Glarsa Hiroo Shibuya ku, Tokyo Nov , % 3,56, 3,299,596 4,32, 4,44, 12, 88, 1,14,43 3 F-4-48 Prospect Hatsudai Shibuya ku, Tokyo Feb % 518, 498,89 654, 663, 9, 145, 164,91 2 F-4-49 Prospect NishiSugamo Kita ku, Tokyo Jun , % 1,11, 1,18,951 1,3, 1,34, 4, 23, 321,48 3 F-4-5 Prospect Machiya Arakawa ku, Tokyo Aug , % 484, 414, , 585, 3, 11, 17,688 3 F-4-51 Prospect KiyosumiTeien Koto ku, Tokyo Feb , % 2,63, 2,519,62 3,28, 3,37, 9, 74, 85,379 3 F-4-52 Prospect Morishita Koto ku, Tokyo Jan , % 1,26, 1,17,858 1,61, 1,64, 3, 38, 469,141 2 F-4-53 Prospect OnshiKoen Koto ku, Tokyo Feb , % 1,11, 98,938 1,66, 1,66, 55, 679,61 1 F-4-54 BELNOS 34 Katsushika ku, Tokyo May , % 1,7, 1,832,38 2,54, 2,63, 9, 93, 797,619 1 F-4-55 SK Residence Toshima ku, Tokyo Feb , % 85, 795,419 1,3, 1,5, 2, 245, 254,58 3 F-4-56 Angel Heim NishiRokugo No.2 Ota ku, Tokyo May , % 1,12, 969,283 1,36, 1,37, 1, 358, 4,716 3 F-4-57 Deim Hashimoto Sagamihara city, Kanagawa Aug , % 748, 739, , 974, 12, 226, 234,135 2 F-4-58 Prospect Kawasaki Kawasaki city, Kanagawa Aug , % 1,52, 1,366,815 2,22, 2,26, 4, 74, 893,184 1

67 66 Family Property No. Property Name Area Constructed Total Number of Rentable Unit Total Rentable Floor Space (square meters) Occupancy Rate (Sep 3, 218) (1) Acquisition Price (2) Book Value 25th fiscal period end (3) Appraisal value 24th fiscal period (4) Appraisal value 25th fiscal period (4) - (3) (4) - (1) (4) - (2) Appraiser F-4-59 Prospect UrawaTokiwa Saitama city, Saitama Feb , % 717, 652, , 971, 2, 254, 318,85 1 F-4-64 Glana Ueno Taito ku, Tokyo Aug , % 1,1, 1,97,281 1,53, 1,56, 3, 46, 462,718 3 F-4-65 The Residence Honmoku Yokohama Bayside Yokohama city, Kanagawa Feb , % 5,55, 5,299,371 6,66, 6,78, 12, 1,23, 1,48,628 3 F-4-66 Lietocourt Asakusabashi Taito ku, Tokyo May , % 1,615,8 1,581,779 2,5, 2,9, 4, 474,2 58,22 3 F-4-71 Gran Casa ShinKoiwa Katsushika ku, Tokyo Feb , % 1,51, 1,594,514 1,59, 1,59, 8, -4,514 2 F-4-72 Gran Casa Ryogoku Ichibankan Sumida ku, Tokyo Feb , % 1,42, 1,447,98 1,46, 1,46, 4, 12,91 2 F-4-73 Gran Casa Ryogoku Nibankan Sumida ku, Tokyo Jun , % 77, 788,59 797, 799, 2, 29, 1,94 2 F-5-23 willdo Temmacho Nagoya city, Aichi Mar , % 627,785 56, , 781, 12, 153,215 22,53 3 F-5-32 Stellato City Sakurayama Nagoya city, Aichi Jul , % 735, 647, , 816, 19, 81, 168,541 1 F-5-37 willdo Kurokawa Nagoya city, Aichi Feb , % 677, 557, , 644, 2, -33, 86,321 1 F-5-6 Gran Casa Daikancho Nagoya city, Aichi Mar , % 1,82, 1,142,41 1,46, 1,5, 4, 418, 357,958 1 F-5-61 Gran Casa Gokiso Nagoya city, Aichi Feb , % 932,5 957,352 1,38, 1,4, 2, 467,5 442,647 1 F-5-67 Lietocourt Marunouchi Nagoya city, Aichi Sep , % 3,756,8 3,671,171 4,97, 5,5, 8, 1,293,2 1,378,828 1 F-5-68 Gran Casa Kamimaezu Nagoya city, Aichi Jun , % 2,5, 1,997,812 2,6, 2,66, 6, 61, 662,187 1 F-5-74 Sakura Hills Fujimi Nagoya city, Aichi Jun , % 2,75, 2,819,213 3,14, 3,22, 8, 47, 4,786 1 F-6-26 willdo NishiAkashi Akashi city, Hyogo Mar , % 635, ,68 799, 824, 25, 188, ,319 3 F-6-33 La Vita Nippombashi Osaka city, Osaka Sep , % 1,86, 1,63,571 1,9, 1,94, 4, 8, 39,428 1 F-6-62 Crown Heim NishiTanabe Osaka city, Osaka Jan , % 45, 388, , 481, 76, 92,852 3 F-6-63 Prospect Katsura Kyoto city, Kyoto Mar , % 47, 441,56 471, 471, 1, 29,943 2 Family type Subtotal Total 3,634 23, % 82,919,158 81,43,657 97,4, 99,85, 1,685, 16,165,841 17,681,342-13, , % 225,564, ,575,34 255,525, 259,467, 3,942, 33,92,85 42,891,659 - F-4-65 The Residence Honmoku Yokohama Bayside A 159-unit family-type condominium developed as a condo-for-sale, completed in 28 Newly acquired in November 213 for JPY 5.55 billion

68 67 Overview of Asset Management Company Company Name Address (As of October 1, 218) Daiwa Real Estate Asset Management Co., Ltd Ginza, Chuo-ku, Tokyo Established October 21, 24 Paid-in Capital Representative Director Board of Directors No. of Employees Registered Financial Instruments Firm Building Lots and Buildings Transaction Business License Discretionary Agent for Real Estate Transaction Approval Association Membership Company Overview 2 million yen Akira Yamanouchi Executive directors: 5 1 Executive auditors: 1 Non-executive directors: 2 Non-executive auditors: 2 19 (excluding dispatched employees) Registration No. 355 (Financial Instruments), Director-General, Kanto Local Finance Bureau (Kinsho) License No. (3)-8392, Governor of Tokyo License No. 34, Minister of Land, Infrastructure, Transport and Tourism Member of The Investment Trusts Association, Japan Member of Japan Investment Advisers Association Member of Type II Financial Instruments Firms Association Daiwa Office Investment Corporation Japan Rental Housing Investment Corporation Daiwa Residential Private Investment Corporation Nippon Healthcare Investment Corporation Daiwa Hotel Private Investment Corporation Directors President and Representative Director Vice President and Representative Director Vice President and Representative Director Executive Managing Director Director Director (non-executive) Director (non-executive) Auditor Auditor (non-executive) Auditor (non-executive) Akira Yamanouchi Yuji Shinotsuka Yoshiki Nishigaki Toshio Fukushima Hajime Imbe Mikita Komatsu Keiichi Ishikawa Tamaki Shibayama Masamori Matsuda Shinji Kiso (As of October 1, 218) REITs which Entrust Asset Management to the Asset Management Company (As of October 31, 218) Listed REIT focusing on office buildings Asset size: approximately billion yen (58 properties) Listed REIT focusing on residential propertiesasset size: approximately billion yen (198 properties) Unlisted REIT focusing on residential properties Asset size: approximately 11. billion yen (71 properties) Japan s first listed REIT focusing on healthcare facilities Asset size: approximately 19.3 billion yen (22 properties) Private REIT focusing on hotels Asset size: approximately 9.2 billion yen (3 properties)

69 68 History and Entrusted assets of Daiwa Real Estate Asset Management Co., Ltd. History October 24 October 25 September 27 July 29 March 21 May 212 May 212 March 213 March 214 June 218 October 218 Established (Company name at the time of establishment was K.K. da Vinci Select ) Started operation of Daiwa Office Investment Corporation (DOI) Registered as Financial Instrument Business Operator ( Investment Management Business ) Daiwa Securities Group Inc. acquired 1% of issued stocks Corporate name changed to Daiwa Real Estate Asset Management Co. Ltd. Change of registration related to the type of Financial Instrument Business Operator (Add Investment Advisory and Agency Business ) Change of registration related to the business of Financial Instrument Business Operator ( Investment Management Business ) (Add business under the discretionary investment contract) Change of registration related to the type of Financial Instrument Business Operator (Add Type II Financial Instruments Business ) Started operation of Daiwa Residential Private Investment Corporation (DRP) Started operation of Nippon Healthcare Investment Corporation (NHI) Started operation of Daiwa Hotel Private Investment Corporation (DHP) Started operation of Japan Rental Housing Investment Corporation along with the merger with Mi-Casa Asset Management Inc. Entrusted assets JPY876.2 bn

70 The strengths of Daiwa Real Estate Asset Management Co., Ltd. and Daiwa Securities Group 69 Formation, management experience, knowhow, professional personnel and management entrustment track record (listed, private and overseas) of real estate funds of wide range of asset types and structures Sponsor is a securities company group with leading Japanese client base and an asset balance of 67 trillion yen of securities Making use of strong relations with institutional investors in Japan and abroad and the wide-ranging individual investor channel of the Daiwa Securities Group The Daiwa Securities Group s strong sponsor commitment towards real estate asset management business Establish a stringent compliance attitude as well as the corporate governance attitude possessed by financial institutions Collaboration with group companies Daiwa Securities - Securities client base and investment banking Daiwa Next Bank - Balance of approximately 3.6 trillion yen of savings, comparable to midsize local banks Daiwa PI Partners - Various equity investment and real estate nonrecourse loans Daiwa Energy & Infrastructure - Renewable energy and infrastructure investment Various infrastructure specialist organizations Fintertech - Crowdfunding operator

71 7 Disclaimer The purpose for this document is to provide information and is not for soliciting investment activities or recommending specific securities. In the event of purchasing investment units of Japan Rental Housing Investments Inc., please contact your securities brokerage company. Information contained in this document is not disclosed material or a management report requested based on the Financial Instruments and Exchange Act, the Investment Trusts and Investment Corporations Law, related ordinances, rules, regulations and listing regulations of the Tokyo Stock Exchange and other related rules and regulations, nor is it based on the aforementioned. The contents of this document includes statements of future forecasts. However, these are based on information available as of the current date and on certain assumptions and judgments. Unknown risks and uncertainties are inherent to such statements and it is feared that such risks, uncertainties, assumptions and other factors may impact such forecasts. Therefore, such future forecasts are not meant to guarantee the future performance, business results, financial content, etc. of JRH. Actual results may greatly differ from the future performance, business results and financial content expressly or impliedly shown by the existence of statements concerning such future forecasts. The content of this document have been rechecked, but JRH does not guarantee the accuracy, certainty, appropriateness or fairness of said content. Furthermore, please be forewarned that the content may be changed or deleted without warning. Copying, transcribing, etc. the content shown in this document without obtaining prior approval is prohibited. [Contact] Corporate Division, Daiwa Real Estate Asset Management Co., Ltd. (Kimoto) Registered Financial Instruments Firm (Registration Number: Director of the Kanto Local Finance Bureau No. 355) / Member of the Investment Trusts Association, Japan) Tel:

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