Earnings Presentation 12 - アドバンス・レジデンス投資法 … · 2016-11-24 ·...

Advance Residence Investment Corporation

Earnings Presentation

12thFebruary 1, 2016 to July 31, 2016

t

i


©2016Advance Residence Investment CorporationAllRightsReserved

Index

　TSETickerCode :3269　Abbreviation :ADR　FiscalPeriodEnd :EndofJanuary&July　MainSponsor :ItochuCorporation　AssetType :Residential

TheLargestPortfolioAmongResidentialJ-REITs 3

SolidTrackRecord,SolidGrowth 4-5

ExecutiveSummaryofFiscalPeriodJuly2016Results 6-7

EnhanceUnit-holders’ValuethroughPublicOffering 8

InternalGrowth 9-14

ExternalGrowth 15-19

Finances 21-23

ManagementPolicies&EarningsGuidance 24-27

Appendix 29-55

ThepurposeofthismaterialistopresentyouwithanupdateonthefinancialperformanceofAdvanceResidenceInvestmentCorporation(the“Corporation”).WedonotintendtoconductanyadvertisingorsolicitationwithrespecttoanyunitsoftheCorporationinconnectionwiththismaterial.Nothinginthismaterialshouldberegardedasanoffertosellorasolicitationofanoffertobuy,arecommendationtosellorbuy,oradirectorindirectofferorplacementof,anyunitsoftheCorporation,exceptforthepurposeofmeetingcertainrequirementsundertheEuropeanAlternativeInvestmentFundManagersDirective(EuropeanDirective2011/61/EU)(the”AIFMD”)asdescribedbelow.

DisclaimerforDutchInvestors：TheprospectuscontainingtheinformationrequiredunderArticle23(1)and(2)oftheAIFMDasimplementedintheNetherlandsisavailableat[http://www.adr-

reit.com/en/financial/en/financial/sonota/].

Anyreproductionoruseofthismaterialotherthanforitsintendedpurposeisprohibitedwithoutpriorpermission.

2

P-106RESIDIAShinagawa

http://www.adr-reit.com/en/financial/disclosure/%5D

Over15min1%

10minto15min7%

5to10min35% Under5min

57%



TheLargest*PortfolioAmongResidentialJ-REITs

*** BookvalueNOIiscalculatedas“annualizedNOI”÷“bookvalueattheendofFP2016/7”.NOIisannualizeaccordingtoactualnumberofdaysofoperationforeachpropertyduringFP2016/7.YieldafterDepreciationiscalculatedas(annualizedNOI-depreciation)÷bookvalueasofendofFP2016/7.

InvestmentLocation(byacquisitionpriceasofApril18,2017)

NumberofProperties TotalLeasableArea Leasableunits AssetsUnderManagement(AcquisitionPrice)

asofJul.31,2016 255properties 766,881㎡　 20,455units 433.6billionyen

asofApr.18,2017** 260properties 781,760㎡　 20,842units 442.7billionyen

3

NOIYields(%)***bylocation(asofJul.31,2016)

** FiveassetsscheduledtobeacquiredfromAugust2016onwardsareincluded.

Unittype(byno.ofunitsasofApr.18,2017)

Rents(byno.ofunitsasofJul.31,2016)

BuildingAge(byacquisitionpriceasofSept30,2016)

WalkingMinutestoTrainStation(byacquisitionpriceasofApril18,2017)

Under10min92%

TenantCategory(byno.ofunitsasofJul.31,2016)

MajorRegionalCities19%

TokyoMetropolitan9%

CentralTokyoex733%

TokyoCentral739%

Tokyo23Wards71%

56%

Offices&Stores1%

Dormitory2%

Large2%Family

15%

Compact25%

Single56%

Single&Compacttypeunits81%

PortfolioYield5.7%4.5%TokyoCentral

7Wards

CentralTokyoex7Wards

TokyoMetropolitan

MajorRegionalCities

0.0% 2.0% 4.0% 6.0% 8.0%

5.0%

4.7%

4.5%

4.2%

6.5%

6.4%

5.8%

5.2%BookvalueNOIyieldYieldafterDepreciation

Over500Kyen0.4%

Under500Kyen1%

Under300Kyen3%

Under250Kyen21%

Under150Kyen23%

Under100Kyen52%

Unitrentsunder250Kyen96%

* AccordingtodatacollectedbyADIMfromthelatestdisclosuresmadebyeachresidentialJ-REITsasofSept.30,2016.

Over10yrs49% Over5yrsto10yrs

45%

Under5yrs6%

WeightedAverageAge10.4yrs

(Incl.assets-to-beacquired)

Students9%

Guaranteedrent13%

Corporate32%

Individuals47%

Pass-throughcontracttenants78%

%



TheLargestPortfolioAmong

ResidentialJ-REITs

Topping430bnyen

(asofFPJuly2016)

MaintainingHigh

OccupancyRate

SolidTrackRecord,SolidGrowth

4

210 221 251249

18,113 19,078 20,23120,122

IncreasingEPSbyImplementingVariousMeasures

* NOIyield=annualizedNOI÷bookvalue.TheNOIareannualizedaccordingtothenumberofactualdaysofoperationforeachpropertiesduringtheperiods.* Yieldafterdepreciation=(annualizedNOI-depreciation)÷bookvalue.

Yield

AUM

TokyoCentral795.6%

MajorRegionalCities96.0%

CentralTokyoex797.3%

PeriodEndOccupancy

Portfolio96.6%

TokyoMetropolitan98.8%12thPeriod10thPeriod8thPeriod 11thPeriod

417.6bn 424.1bn 425.8bn 442.7bn

StableYieldLevels

7thPeriod

401.8bn

No.ofLeasableUnits

No.ofProperties

Occup

ancy

9thPeriod

240

19,572

410.5bn

Assets

07-2013 01-2014 07-2014 01-2015 07-2015 01-2016 07-2016

85.0

90.0

95.0

100.0

Portfolio Tokyo Central 7 Central Tokyo ex 7 Tokyo Metropolitan Major Regional Cities

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016 FP07-2017

4.3% 4.4% 4.4% 4.5% 4.4% 4.5% 4.5%

5.5% 5.6% 5.6% 5.7% 5.6% 5.7% 5.7%

Book-valueNOIYieldYieldafterDepreciation

(forecast)

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016 April18,2017(planned)

TokyoCentral7CentralTokyoex7TokyoMetropolitanMajorRegionalCities

15.2%10.5%

29.3%

44.9%

16.7%10.1%

28.8%

44.4%

19.8%10.0%

30.8%

39.4%

19.1%9.7%

31.5%

39.7%

19.3%9.7%

31.3%

39.7%

18.9%9.5%

32.2%

39.4%

19.3%9.3%

32.6%

38.9%

255

20,455

260

20,842

71.6%

433.6bn

71.4%

96.8%96.4% 96.6% 96.5%96.4% 96.1%

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016 FP07-2017(forecast)

4,7304,7734,5774,5725,070

4,5234,415

DividendPaidfromNetIncomeDrawdownfromDividendReserve

4,500

50%

55%

GuidelineRange


LoweredLTVRangetoMaintainFlexibilityinPreparationforFutureFinancialVolatility

AcquisitionCapacity(@TotalAssetsLTVof53%)

approx.30.0bnyen

(estimateforFPendingJuly2017)

LoweredInterestRateWhileExtendingDurationand

MaintainingFixedInterestRateDebt

Ratio

SteadilyGrowingEPU

OutstandingDividendReserve

33.5bnyen(asofFPJuly2016)

IncreasingNAVperUnit

inyen/unit

Liab

ilitie

s LTV

Deb

ts

Equitie

sDividen

dsNetAssetValue

* Incalculatingtheaverageinterestrate,theeffectofinterestrateswapsarereflected.Ifthereareanydiscrepanciesbetweentheprincipalamountoftheswapandtheunderliningamountofdebt,theswap’sprincipalamountwillbecappedattheunderliningamountofdebtinthecalculation.

* AppraisalLTV=(Outstandingamountofloanatthefiscalperiodend+Outstandingamountofbond)÷Appraisedvalueofthefiscalperiodendpropertyholdings

5

Fortheforeseeablefuture,maximumleveragewillbe50%forappraisalLTV,53%forTotalAssetsLTV.

max53%

5,130

4,5784,5934,615

* NAV/Unitiscalculatedasfollows.(FPendnetasset+FPendunrealizedgainorloss-dividendamountfortheFP)÷FPendnumberofissuedandoutstandingunits.

max50%

7thFP 8thFP 9thFP 10thFP 11thFP 12thFP

4,572NetGainonSales503

inyen/unit

5thFollow-OnOffering

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

DebtDurationFixedInterestRatio

92.6%98.4%98.7%99.8%94.8%93.5% 4.3yrs3.9yrs4.1yrs4.1yrs4.1yrs3.8yrs

1.26% 1.23% 1.21%1.16% 1.14%

1.05%

AverageInterestRate

4,7744,979249

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016 FP07-2017


AssetReplacements

(forecast)

FP01-2017(forecast)DPU4,859

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

223,586216,739207,281198,261182,367171,850NAV / Unit

52.1%51.0% 50.1% 51.6% 51.4% 52.2%

49.7%

43.3%46.0%45.9%47.3%47.2%

50.1%

52.3%



ExecutiveSummaryCommittedinDeliveringStrongandStableDividend

ResultsforFiscalPeriodendedJuly31,2016

FiscalHighlights

ExternalGrowth

MaintainingHighOccupancywhileSucceedingtoRaiseRents

InternalGrowth FundRaisingActivities

4,774yen +184yenDividendperUnit* +196yen

chg.frominitialforecast chg.fromlastperiod

IncreaseinRevenue,ProfitsandDividend

MaintainedHighOccupancy,SucceededinRaisingRentsandAcquiredFiveProperties

LengthenedDurationandLoweredFinancingCost

6

* DividendperunitmightbeabbreviatedasDPUandearningspershareasEPU,hereafter.

AcquiredFiveProperties,MostlySponsorDevelopedandLocatedintheTokyo23Wards

AveragePeriodOccupancy 96.8% +0.3%pt

PortfolioRentChange +0.45% +0.12%fromTennantReplacements +1.27% +1.34%

fromContractRenewals +0.40% +0.21%

increasefromforecast

actualfigureforperiodyearbefore No.ofProperties 5properties

AcquisitionPrice 8.6billionyenAverageBuildingAge 1.9years

NOIYield 4.8%

AverageInterestRate 1.05% -0.09%pt

AverageDuration 4.3years +0.4years

FixedInterestRateDebtRatio 92.6% -5.7%pt

chg.onperviousFP

Duetoriseinoccupancyrateandloweringofrenovationcostbyoptimizing



ResultsforFiscalPeriodendedJuly2016inmillionyen

(1)12thFPForecast

(2)12thFPResults (2)-(1)

(3)11thFPResults (2)-(3)

InitialForecastasofMar.11,2016

ResultsforFPJuly2016 Changes Notes

ResultsforFPJan.2016 Changes Notes

Revenue

15,363(255properties)

Periodavg.occupancy

96.5%


Periodavg.occupancy

96.8%+80

AssetAcquisitionsandDispositionsIncreasefromRDFunabashiIIIacquisition

DecreasefromdispositionofMaisonYachiyodaiSameStore

Increasesfromhigheroccupancy,etc.

+13-28

+95


Periodavg.occupancy

96.5%+361

AssetAcquisitionsandDispositionsContributionfrom2016/1&2016/7acquisition

Decreasefrom2016/7dispositionSameStore

IncreasesfromhigheroccupancyPeak-seasonincreasesinkeymoney&

renewalfeeincome

+203-27

+84

+100

OperatingIncome7,509

(Depreciation:2,573)(Propertytaxes:825)

7,727(Depreciation:2,568)(Propertytaxes:823)

+217

LeasingExpensesNeteffectofbuy/sellofrealestates

DecreaseinrenovationcostsDecreaseinutilitycosts

G&AExpensesIncreasesinmanagementfeesduetohigherprofits

+5+88+49

-7


+238

LeasingExpensesNeteffectofbuy/sellofREin2016/1&2016/7

Peak-seasonincreasesDecreaseinrenovationcosts

Increaseindepreciation&expensingofpropertytaxesG&AExpensesIncreasesinmanagementfeesduetohigherprofits

-49-89+76-9

-51

OrdinaryIncome 5,967(Fundingcost*:1,538)

6,206(Fundingcost*:1,510)

+238 DecreaseinfundingcostsduetolowerinterestrateDecreaseinnon-operatingincome

+26-5


+254Increaseinfinancingcostfromacquisition

fundingDecreaseinfundingcostsduetorefinancing

Noone-offprofit

-53+79-9

NetIncome 5,967 6,205 +238 5,951 +254

DrawdownofRetainedEarnings** 0 0 - Retainedearnings**afterdividend:33.5bnyen 0 - Retainedearningsafterdividend:33.5bnyen

DividendAmount 5,967 6,206 +239 5,951 +254

EPU(yen) 4,590 4,773 +183 Unitsissuedandoutstanding1,300,000units 4,577 +196 Unitsissuedandoutstanding

1,300,000unitsDrawdownof

RetainedEarnings** 0 0 - 0 -Dividendperunit

(yen) 4,590 4,774 +184 4,578 +196FFOperUnit(yen) 6,569 6,752 +183 6,524 +228

FFOPayoutRatio 69.9% 70.7% +0.8pt 70.2% +0.5pt

TotalAssetLTV 52.3% 52.2% -0.1pt 51.4% +0.8pt

7

fromFebruary1,2016toJuly31,2016

* Fundingcostsincludeinterestpaymentsforloansandbondsaswellasotherfinancefees.***WhencalculatingthechangesofFFOperunit,decimalsareignored.** “RetainedEarnings”means“DividendReserve”orfromJan.2017“RetainedEarningsforTemporaryDifferenceAdjustment.

100,000

200,000

300,000

March2,2

010

Jun.21,2

010

Jan.23,

2012

Jan.21,2

013

Jan.22,

2014

Sept.14,

2016

Sept.30,

2016

ADRUnitPrice(IssuePrice)TSEREITIndex



EnhanceUnit-holders’ValuethroughPublicOffering

EquityFinanceHistory

8

UnitPriceMovementAfterEquityFinancing

TheEffectsoftheFollow-OnOffering

FPJuly2013(afterthe3rdFOoffering)

FPJuly2014(afterthe4thFOoffering)

FFO/Unit

4,267 4,523

6,109 6,413

→Earnings/Unit

51.2% 51.0%TotalAssetLTV

NumberofOutstandingUnits 1,240,000 1,300,000→

Dividend/Unit 4,597 4,593→

→

→

ForecastofFPJuly2017

(afterthe5thFOofferingandthepropertyacquisitions

completed)

4,730

6,682

49.7%

1,350,000

4,979

→

→

→

→

→

393.8billionyen 417.6billionyenAUM 442.7billionyen(basedonacquisitionprice) (204properties) (221properties) (260properties)

(FPJan2017Forecast4,600yen)

→ →

(yen)

(yen)

(yen)

(FPJan2017Forecast4,859yen)

(maximum)＊TSEREITIndexisre-indexedbyusingAdvanceResidence’sMarch2,2010closingpriceof112,500yenasbase.

The3rdFollow-OnPublicOffering

The4thFollow-OnPublicOffering

The5thFollow-OnPublicOffering

LaunchDate Jan.8,2013 Jan.9,2014 Sept.6,2016

IssuePrice 165,945yen 213,330yen 263,445yen

No.ofUnitsIssued(includingthird-party

allotment)140,000units 60,000units 50,000units

AmountRaised 22.4billionyen 12.3billionyen 12.7billionyen

AssetsAcquired 12properties,21.6bnyen 11properties,15.8bnyen 5properties,9.0bnyen

AllKeyFiguresImproveDuetoPremiumPricedOfferings

Dateoflisting

4thFOoffering

3rdFOoffering

2ndFOoffering1stFO

offering

5thFOoffering

PriceasofSept.30,2016286,500yenyen

(maximum)

(maximum)

InternalGrowth

9

R-52RESIDIATOWERSendai

-3%

0%

3%

FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

-2.7%

-1.0%-0.0% +0.3%

+1.3% +1.1% +1.3%Changes in Rent

-0.5%

0.0%

0.5%

FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

-0.2% -0.2%-0.1%

+0.0%+0.2%

+0.5%+0.4%

Changes in Rent



FPJuly2016TenantReplacementsandRenewals

TenantReplacements*

10

No.ofUnits Ratio OldRent NewRent Difference %Change

Increase 774 units 54.2% 92 96 +4 +4.39%

Unchanged 254 units 17.8% 27 27 - -

Decrease 399 units 28.0% 44 43 -1 -4.32%

Total 1,427 units 100.0% 164 167 +2 +1.27%

No.ofUnits Ratio OldRent NewRent Difference %Change

Increase 528 units 18.4% 68 69 +1.3 +2.04%

Unchanged 2,330 units 81.2% 259 259 - -

Decrease 12 units 0.4% 1 1 -0.06 -4.01%

Total 2,870 units 100.0% 330 331 +1.3 +0.40%

inmillionyen inmillionyen

TokyoCentral7Wards +1.71% CentralTokyo+1.81% MetropolitanArea +0.61% MajorRegionalCities+0.24%

6thFP 7thFP 8thFP 9thFP 10thFP 11thFP 12thFP 6thFP 7thFP 8thFP 9thFP 10thFP 11thFP 12thFP

1,169units 1,015units 1,221units 955units 1,460units 1,013units 1,427unitsNo.ofreplacements 1,952units 1,408units 2,251units 1,695units 2,646units 2,012units 2,870unitsNo.ofrenewals

FPJul.2016Results

ShareofRentChange(byno.ofunits)

RentChangesinTenantReplacements

FPJul.2016Results

ShareofRentChange(byno.ofunits)

RentChangesinTenantRenewals

+1.27%+0.40%

* Rentchangeforpass-throughunitsthatarebothoccupiedatthebeginningandtheendoftheperiod.

TokyoCentral7Wards +0.57% CentralTokyo+0.21% MetropolitanArea -0.07% MajorRegionalCities+0.29%

FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

81.2%77.1%91.3%97.5%97.3%98.2%96.1%

0.4%0.4%0.3%0.6%2.3%1.8%3.9%

DecreaseUnchangedIncrease

18.4%22.4%8.4%1.8%0.4%

Renewals*

FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

54.2%51.7%56.1%43.8%47.4%32.3%28.1%

17.8%17.0%15.1%19.7%21.9%

30.1%19.6%

28.0%31.3%28.8%36.5%30.7%37.5%52.4%

DecreaseUnchangedIncrease

FP01-2011 FP07-2011 FP01-2012 FP07-2012 FP01-2013 FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

LeasingExpenseExpensenetofkeymoney

-0.91-1.00-0.90-0.98-0.93-1.09-1.04

-1.56

-1.68-1.67-1.66-1.55-1.66-1.66-1.65-1.87

-1.56

-1.04 -1.09 -0.93 -0.98 -0.90 -1.00 -0.91

0.770.660.760.580.730.580.61

0.30

KeyMoney

FP01-2011 FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

-0.97%

-0.30%-0.12% -0.09%

+0.08% +0.12% +0.13%

+0.45%RentChange

0%

PortfolioRentRise

Inco

me

Expe

nse

100

100.0(93.9%)



RiseinNER

ImprovementinOccupancy

AchievingInternalGrowthintheResidentialSector

InternalGrowthThroughIncreaseinPortfolioRent,ImprovementinLeasingTermsandHigherOccupancy

LeasingRelatedIncomeandExpensesunit:monthrent

ChangesinNetEffectiveRent(NER)

101.3(95.1%)

101.3(95.1%)

101.0(94.8%)

101.2(95.0%)

101.3

99.5100.6100.4

99.1

IndexedPeriodAvg.Occupancy(Avg.Occupancyoftheincludedproperties)

×

AchievingInternalGrowth

‣ The115propertiesthatareincludedinabovechartsarepropertiesheldsincethestartoftheFP01-2011.Followingpropertiesareexcludedfromthecalculation.1)Propertieswithguaranteedrentorpropertieswherethewholebuildingislettoonetenant.Thisisbecausefluctuationin“keymoney”and‘leasingrelatedexpensesdonoteffectADR’srentalincomefromthoseproperties.2)PropertiestargetedforExpats,wheretherearenokeymoneypractices.

‣ Numberofnewcontractsforeachfiscalperiodisasfollows,FP01-2011)1,748,FP07-2011)1,074,FP01-2012)870,FP07-2012)1,026,FP01-2013)981,FP07-2013)1,024,FP01-2014)794,FP07-2014)924,FP01-2015)835,FP07-2015)918,FP01-2016)788,FP07-2016)625.‣ NetEffectiveRentIndexiscalculatedasmonthlyrentalofnewcontractsandcommonfeespluskeyMoneyIncomedividedby24month,minusleasingrelatedexpensesdividedby24monthandweightedaveragedbyeach116propertiesrentablespaceforeachfiscalperiodandindexed

byusingtheFP01-2011figureas100.

101.7101.2(95.0%)

IndexedNetEffectiveRent

0

11

101.4 101.1(94.8%)

101.6(95.4%)

103.3

>>>

>>>

>>>

>>>

NER=MonthlyRent+(KeyMoney-LeasingExpense)÷24months

100.0

102.2(95.9%)

104.8

106.9

102.1(95.9%)


104.0

101.8(95.5%)

FourthConsecutiveFiscalPeriodRiseinRent*

*Changeinrentsforallunitsthatarebothoccupiedatthebeginningandtheendoftheperiod.

+0.45%

Excludingguaranteedrenttopass-throughcontractchanges+0.16%

101.9(95.6%)

Single Compact Family&LargePortfolioTokyoCentral7Wards CentralTokyo MetropolitanArea MajorRegionalCit

ies

92

96

100

03-201001-20

1107-20

1101-20

1207-20

1201-20

1307-20

1301-20

1407-20

1401-20

1507-20

1501-20

1607-20

16

PortfolioTokyoCentral7WardsCentralTokyoMetropolitanAreaMajorRegionalCities

90

95

100

03-201001-20

1107-20

1101-20

1207-20

1201-20

1307-20

1301-20

1407-20

1401-20

1507-20

1501-20

1607-20

16

PortfolioSingleCompactFamily&Large



ChangesinRents&RentGaps

RentsRiseSeenEspeciallyinTokyo23Wards

12

RentGapsfortheWholePortfolio+1.29%

* Rentchangeforpass-throughunitsheldatJuly31,2016.RentatMarch31,2010indexedas100.

95.4→95.7→95.8→95.9→96.3

RecentChangeinRentfortheWholePortfolio

2014/7 2015/1 2015/7 2016/1 2016/7

RentChange*byRegion

RentChange*byTypeofUnit

a) FourthconsecutiveFPriseinrentsforthewholeportfolio.b) Therearemarkedrecovery in rents inTokyoCentral7Wards

whereitsawthelargestrentdeclineinthepastaswellasrentsinCentralTokyoregion.LeasingaremostlydoingwellinTokyo23Wards,includingplacessuchasRoppongiandAzabu.

c) Althoughtherearesomediscrepanciesbetweencities,bybeingselective in the initial investments, rents for ADR’s regionalportfolioarestableasawhole.

UpwardRentChangesCanBeExpectedMainlyinTokyo23WardattheTimeofTenantReplacements

a) Rentsroseinmostofthetypesofunits.b) TherewasalsorentriseinSingletypeunitswherethevolume

indemandislargestandtherentsarestable.c) AlthoughthenumberofunitsheldbyADRissmall,Familyand

Large type units are seeing significant uptick recently due toreboundfrompastdeclineandtightdemand.

ArentgapisagapbetweentheunitrentofnewtenantsofFPJul.2016(treatingthiscurrentrentasapproximationofmarketrent)andunitrentofexistingtenants,aggregatedforthewholeportfolioforleasingcontractsthatarepass-throughs.ThecalculationismadeoneachpropertyandbyeachunittypeforpropertiesheldattheendofFPJul.2016.A+1.29%gapmeansthat,ifthegapistobeclosedbyriseinexistingtenants’rents,thantheportfoliorentwillriseby+1.29%.

+0.66% +0.61%

-0.08%

+0.10%MarketRent MarketRent+0.18% +0.34%

+0.77%+1.29%

b)

b)

FourthConsecutiveRise

(newtenants’rentinFP07-2016)

(newtenants’rentinFP07-2016)

TotalCost: 3.4millionyenVE*Works: 1.0millionyenIncreaseinMonthlyRent**: up14.5%ProjectedRecuperationPeriod***: 5years

TotalCost: 6.3millionyenVE*Works: 2.4millionyenIncreaseinMonthlyRent**: up50.4%ProjectedRecuperationPeriod***: 3years



Large-ScaleRepairs&ValueEnhancementWorks

Large-scaleRepairs

13

ExamplesofWorksCompletedinFPJuly2016

ExteriorwallrepairsTilepeelingprevention

TotalCost: 29.4millionyen

ValueEnhancementWorks

Entranceupgrades LEDlightingsincommonarea

Worksstartedfor2propertiesduringtheperiod

before

after

before

after

C-19RESIDIAShin-Nakano P-24RESIDIAAzabujubanII P-53RESIDIARoppongi-Hinokichokoen

Differentiatingaplainfloorplanbyutilizinganaccentwall

Changedtostylishopenkitchenlayoutandremovedtatamiroomtoachievefreerfloorplan

41unitsfrom13propertiesreceivedVE*worksduringtheperiod,withaveragemonthlyrentincrease**of17.4%BuildingAge

15yrsBuildingAge

14yrs

*VEworksstandsforvalueenhancementworks.VEworksareworksinvolvingchangessuchasspecificationsandlayouts.**Increaseinmonthlyrentsarecalculatedforthe25unitsleasedoutasofSept.26,2016,dividingthenewlycontractedmonthlyrentbythepreviousrent.***ProjectedRecuperationPeriodsareperiodsprojectedtorecuperatethevalueenhancementcost,whichiscalculatedastotalcostminusrenovationcostsandequipmentreplacementsduetoaging.

BuildingAge

17yrs

No.ofProperties: 19properties

TotalInvestment: 900million 47millionyenperproperty

No.ofValueEnhancedUnits: 194units

No.ofUnitsLeased-out: 165units

%IncreaseinRents: 9.6%



MaintainingtheCompetitivenessofProperties

14

WorksAreScheduledwithCashManagementinMindmillionyen

BySchedulingandExecutingProperMeasuresProperty’sCompetitivenessCanbeMaintained

5thFP 6thFP 7thFP 8thFP 9thFP 10thFP 11thFP 12thFP 13thFP 14thFP 15thFP 16thFP 17thFP

DailyMaintenance

Large-scaleRepairs

EquipmentRenewalsandValueEnhancement(VE)Works

Workscarriedoutataround15yearsintervals

Renovationworksarecarriedoutatthetimeofeverytenantreplacement

Valueenhancementworks*areconsideredatthetimeofkitchen&bathroomequipmentrenewals(ataround15yearsintervals)

TrackRecordSincetheMerger(excludingdisposedproperties)

TrackRecordSincetheMerger(excludingdisposedproperties)asofSept.262016

* Increaseinrentsarecalculatedforthe165unitsleasedoutasofSept.26,2016,dividingthefirstcontractedmonthlyrentafterVEworksbythemostrecentrentbeforetheVEworks.

0

400

800

1,200

1,600

FP01-2013 FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016 FP01-2017 FP07-2017 FP01-2018 FP07-2018 FP01-2019

36429627611529530145112

2601526595

23453423414326301280313352

228212185237176

526558495523487505576522452451387478330

ExpensedRepairsCapEx(OtherRenovations)CapEx(Large-scaleRenovations)

FirstREITmanagementcompanytoberegisteredasFirst-Class-ArchitectOffice

* CostofVEworksareexpectedtoberecuperatedwithin10years

Projection

ExternalGrowth

15

C-54RESIDIATsukishimaIII



Acquisitions&DispositioninFPJuly2016

16

AcquiredRecentlyBuiltPropertiesMostlyinTokyo23WardsandMainlyfromSponsor’sPipeline

Acquisitions

AcquisitionPrice 840millionyen

BookValue 818millionyen

NOIYield 5.9%

YieldafterDepreciation 3.8%

Completion Aug.1989

PropertiesAcquiredThroughSponsor’sPipeline

TokyoMetropolitan

ThirdParty(NegotiatedTransaction)

DispositionTotal

No.Properties 5properties 2properties 2properties 1propertiesAcquisitionPrice(yen) 8,663million 1,738million 6,305million 620million

%DealShare 100.0% 20.1% 72.8% 7.2%WeightedAve.NOIYield 4.8% 4.8% 4.7% 5.5%

WeightedAve.YieldafterDepreciation 4.1% 4.2% 4.0% 4.6%No.LeasableUnits 263 72 148 43

WeightedAve.BuildingAgeattheTimeofAcquisition 1.9years 1.6years 1.2years 9.5years

MaisonYachiyodai

* Acquisition prices are roundeddowntothenearestmillion.

* NOI yields = appraisal NOI ÷acquisitionprice×100%

* Listed building ages are as of thedate of the acquisition of eachproperty.

TokyoMetropolitanCentralTokyoex7TokyoCentral7Wards

YieldafterDepreciation3.8%

26.6yearsBuildingAgeatTimeofDisposal

Tookadvantageoftheboomingmarketanddisposedanagedlowyieldingproperty

RESIDIANakanobuII RESIDIAOchanomizuII RESIDIABunkyo-HongoIII RESIDIAShin-OkachimachiII RESIDIAFunabashiIII

TokyoCentral7Wards TokyoCentral7Wards CentralTokyoex7 CentralTokyoex7 TokyoMetropolitan

AcquisitionPrice 917millionyen 821millionyen 1,655millionyen 4,650millionyen 620millionyen

NOIYield 4.8% 4.9% 4.7% 4.6% 5.5%Yieldafter

Depreciation 4.2% 4.2% 4.1% 3.9% 4.6%

LeasableUnits 44units 28units 48units 100units 43unitsCompletion April2014 March2015 July2014 March2015 October2006



AcquisitionsScheduledforFPJan.&Jul.2017

17

AchievingExternalGrowth&AvoidingExcessiveCompetitionsbyUtilizingSponsor’sPipeline&NegotiatedDeals

TotalNo.Properties 5properties 1properties 2properties 2properties

AcquisitionPrice(yen) 9,081million 1,159million 4,368million 3,554million

%DealShare 100.0% 12.8% 48.1% 39.1%WeightedAve.NOIYield 5.0% 4.7% 4.7% 5.5%

WeightedAve.YieldafterDepreciation 4.2% 4.1% 4.0% 4.5%No.LeasableUnits 387 42 187 158

WeightedAve.BuildingAgeattheTimeofAcquisition 4.3years 1.5years 3.1years 6.7years

CentralTokyoex7TokyoCentral7Wards

PropertiesAcquiredThroughSponsor’sPipeline

MajorRegionalCities

ThirdParty(NegotiatedTransaction)

AcquiredinOctober2016 TobeacquiredbyApril2017 TobeacquiredinMarch2017 TobeacquiredinNovember2016

RESIDIAMishuku RESIDIAKameido RESIDIAKoenji RESIDIASenri-Fujishirodai RESIDIASenri-Banpakukoen

TokyoCentral7Wards TokyoCentral7Wards CentralTokyoex7 MajorRegionalCities MajorRegionalCities

AcquisitionPrice(yen) 1,159million 2,988million 1,380million 1,430million 2,124million

NOIYield 4.7% 4.7% 4.7% 5.7% 5.5%

YieldafterDepreciation 4.1% 4.1% 4.0% 4.6% 4.5%

LeasableUnits 42units 129units 58units 90units 68unitsCompletion April2015 October2013 March2015 March2017(scheduled) October2005

0

15

30

Completed FY2016 FY2017 FY2018

Pre-buildingPermitInDevelopmentCompleted



PreparingforFutureExternalGrowth

18* “ItochuGroupDevelopmentExamples”arerentalapartmentpropertydevelopmentsbyItochuCorporationandItochuPropertyDevelopmentLtd.asofSept.29,2016andlistedaboveasareference.Assuch,ADRisundernoobligationtoacquiretheproperties.

ExternalGrowthWillBeAchievedMainlyThroughSponsor’sPipeline

SourcingTrackRecord

SourcingTrackRecordonYearlyBases

Total21properties 1,637plannedunits approx.35billionyen

CentralTokyoex.7

Location PlannedUnits

9 Minami-Kamata,Ota-ku 11010 Kamata,Ota-ku 14911 Kamiogi,Suginami-ku 5812 Koishikawa,Bunkyo-ku 4313 Ikegami,Ota-ku 4314 Yanaka,Taito-ku 5015 Itabashi,Itabashi-ku 6016 Hongo,Bunkyo-ku 38

8properties 551

Osaka


19 Toyotsucho,Suita 13720 Toyotsucho,Suita 6021 Oyodo-minami,Kita-ku,Osaka 84

3properties 281

DevelopmentsmostlyintheTokyo23Wards

Total8properties＋

TokyoCentral7


1 Kanda-Awajicho,Chiyoda-ku 282 Minami-Shinagawa,Shinagawa-ku 833 Sangenjaya,Setagaya-ku 704 Mita,Minato-ku 275 Meguro,Meguro-ku 516 Shin-Ogawamachi,Shinjuku-ku 237 Soto-Kanda,Chiyoda-ku 358 Sangenjaya,Setagaya-ku 49

8properties 366

ItochuGroupDevelopmentExamples

Completedpropertiesareindicatedinredletters.

LandPlotsWaitingforBuildingPermit

no.ofprojects

(Basedonsigningdateoflandplottransactioncontract)

* FY:FiscalyearendingMarchinthefollowingcalendaryear.

CompletionPhotoof10Kamata,Ota-kuproject

TokyoMetropolitan


17 Nakahara-ku,Kawasaki 39118 Higashi,Kunitachi 48

2properties 439

BuildingCompletionScheduleandVolume RentalResidenceDevelopmentTrackRecord

RichPipeline TheSponsorisConsistentlyAcquiringLandplotsforDevelopment14properties approx.21blnyen

7properties approx.13blnyen8properties approx.13blnyen

14

3 55

2

DiversifiedSourcingChannel

115properties,166.3billionyen(basedon(planned)acquisitionprice)

0

20

40

toJuly20

11

toJuly20

12

toJuly20

13

toJuly20

14

toJuly20

15

toJuly20

16

toJuly20

17

3.52.3

10.3

7.913.4

18.8

13.9 19.2

15.88.1

9.2

5.586.24.310.58.7

SponsorGroup BridgeFund ThirdParty

no.ofprojects

ThirdParty42%

BridgeFund32%

SponsorGroup26%

billionyen

* 5 properties ADR is schedule to acquire from Aug. 2016onwardsareincludedinthechart.

0

5

10

15

FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016

45

129

657

1H20082H2008

1H20092H2009

Mid-TermAug2010

FP01-2011

FP07-2011

FP01-2012

FP07-2012

FP01-2013

FP07-2013

FP01-2014

FP07-2014

FP01-2015

FP07-2015

FP01-2016

FP07-2016

Book-valueNOIYieldAppraisalDirectCapRate



AppraisalValue

AppraisalDirectCapRate•UnrealizedProfitandLoss

SummaryofEndofFPJuly2016Appraisal

＊ BookvalueNOIyieldiscalculatedasfollows.ThetotalofactualNOIofpropertiesattheendofeachperiodareannualizedaccordingtotheactualnumberofdaysofoperationdividedbythetotalbookvalueatendofeachperiods.＊ Dotedlineexpressestheperiodsthatarebeforethemerger.

088.9billionyen

＊ ForAssetsacquiredduringtheFPJuly.2016,appraisalvalueatthetimeofacquisitionisusedasthepreviousappraisalvalue.

4.8%4.9%

+=

21.2%ofPortfolioBook-value

19

5.6%

5.0%

NCFImpact +1.21billionyenRiseinAppraisalValue +6.49billionyen DCRImpact +5.28billionyen

5.6%

4.8%

inmillionyen

5.3%5.1%4.8%

4.6% 4.6%

5.5% 5.5%

5.3% 5.3%

5.5%

5.4%

5.4%

5.3%

5.3% 5.4%

5.3%

5.3%

5.2%

5.5%

5.2%

5.5%

5.1%

5.7%

RecordLowCapRate

Appraisal(inmillionyen) AppraisalNCF(inmillionyen) DirectCapRate(%) ActualNOIYield(%) UnrealizedProfitandLoss(millionyen)

EndofFPJul.’16 diffvslastFP EndofFPJul.’16 diffvslastFP EndofFPJul.’16 diffvslastFP FPJul.’16 BookValue(a)Differencefromtheappraisal

(b)(b)/(a)

TokyoCentral7Wards 193,578 +2,450 8,473 +35 4.31% -0.04pt 5.2% 164,808 +28,769 17.5%

CentralTokyoex.7Wards 166,907 +1,793 7,546 +34 4.46% -0.03pt 5.8% 135,900 +31,006 22.8%

Tokyo23WardsTotal 360,485 +4,243 16,020 +69 4.38% -0.03pt 5.4% 300,709 +59,775 19.9%

TokyoMetropolitan 47,662 +507 2,368 △2 4.94% -0.06pt 6.4% 38,562 +9,099 23.6%

MajorRegionalCities 100,038 +1,748 5,132 △10 5.08% -0.10pt 6.5% 79,961 +20,076 25.1%

PortfolioTotal 508,185 +6,498 23,521 +56 4.57% -0.05pt 5.7% 419,232 +88,952 21.2%

-RecordLowCap-rate&IncreaseinUnrealizedProfit-

160propertiesoutof255properties

(valuedecreasedin22properties)

RiseinAppraisalValue

PropertieswithUnrealizedLoss

Totalunrealizedloss0.82billionyenin5properties

(Previousperiod0.95billionyenin6properties)

5.6%

4.7% 4.62%

88,95280,05167,75556,03135,29023,59614,0006,4603,604311

-2,144-6,678-8,053

UnrealizedProfit/LossUnrealizedprofitof

5.7%

4.57%



Note

20

Finances

21

R-34RESIDIAOdori-Koen

50%

55%

GuidelineRange



BuildingaStableFinancialBaseKeyFiguresonDebts

FP01-2016 Loan/BondRatio FP07-2016 Loan/Bond

Ratio

Loans 187.7bnyen 83% 192.3bnyen 82%

(Short-termloans) - - - -

Bonds 38.5bnyen 17% 41.5bnyen 18%

DebtOutstanding 226.2bnyen 100% 233.8bnyen 100%

TotalAssetLTV 51.4% 52.2%

AppraisalLTV 45.9% 46.0%

22

CreditRatings

JCR AA(Stable)

R&I A+(Stable)

DebtFinancingFPJuly2016

Repayments DebtFinancing

AverageInterestRate

AverageInitialDuration

TotalAmount

*AmortizeddebtrepaymentsareincludedintheTotalAmountofRepayments.

16.7bnyen

1.38%

4.7years

LoweredFinancingCostWhileFinancinginLongerDebts

24.3bnyen 0.42%

9.5years

LTVManagement

max53%

max50%

Fortheforeseeablefuture,maximumleveragewillbe50%forappraisalLTV,53%forTotalAssetsLTV.



AssetReplacements

51.6%50.1%51.0%

52.1%

45.9％47.3％47.2％

50.1％

52.3％ 51.4% 52.2%

46.0％ 43.3％

49.7%49.7%

43.8％

(forecast)(forecast)


FP01-2017FP07-2017

FP01-2018FP07-2018

FP01-2019FP07-2019

FP01-2020FP07-2020

FP01-2021FP07-2021

FP01-2022FP07-2022

FP01-2023FP07-2023

FP01-2024FP07-2024

FP01-2025FP07-2025

FP01-2026FP07-2026

FP01-2027~

3.03.5

2.02.53.01.54.0

2.08.0

4.08.0

4.58.1

1.8

10.1

1.87.17.96.88.4

11.712.211.46.5

14.8

6.0

12.99.7

19.1

9.413.5

11.0

LoansBonds

9.5yrs

7.7yrs7.9yrs7.7yrs7.9yrs

Avg.InitialDurationDuringtheFPAvg.FundingRateDuringtheFP

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

1.26% 1.23% 1.21% 1.16% 1.14% 1.05%

Avg.InterestRate



DiversifyingDuration,SettingUpaCommittedLineofCredit

DurationExtended,RatioofFixedInterestDebtsIncreasedandMaturityDiversifiedWhileFinancingCostLowered

Roundeddowntothenearest100millionyen

* Debtsprocuredduringtheperiodwhichwererepaidduringthesameperiodareexcluded.

* In Calculating the average interest rate for financing during the periods, amount outstanding and interest rate applicable at the end of each period is used.

* In Calculating the average debt duration for financing during the periods, amount outstanding at the end of each period is used to calculate the weighted average.

* In calculating the years to maturity, amortization is not counted.

* Short-term loans are excluded.

23

FP01-2016Financing

FP07-2016Financing

FP07-2014Financing

AverageInterestRate DebtDuration RatioofFixedInterestRateDebts

FP07--2015Financing

15billionyenContinuetostrengthenthefinancialbasebyfurtherflatteningthematurityladder

CommittedLineofCredit20billionyen

asofendofFP07-2016

FP07-2016AverageFundingInterestRate0.42%

FP01-2015Financing

1.02%0.82% 0.73%

0.63% 0.42%

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

7.4%1.6%1.3%0.2%5.2%6.6%

92.6%98.4%98.7%99.8%94.8%93.5%

FixedInterestRate FloatingInterestRate

bnyen

FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2015 FP07-2016

3.8yrs 4.1yrs 4.1yrs 4.1yrs 3.9yrs 4.3yrs

Avg.RemainingDuration

FP07-20

14

Fina

ncing

FP07-20

16

Fina

ncing

FP01-20

16

Fina

ncing

FP01-20

15

Fina

ncing

FP07-20

15

Fina

ncing

1.25%1.48%

1.01%1.17% 1.26% 1.17%

1.05%0.81% 0.83%

0.98%

1.33%

0.94%1.06% 1.12%

1.00%

0.66%

1.18%

0.73%

1.06%

0.42%

0.85%

AverageInterestRate

ManagementPolicies&EarningsGuidance

24

C-83RESIDIANihonbashi-BakurochoIII



DrawdownofReserve

TheactualdividendswillbedecidedbytheADR’sboardbasedonacomprehensiveconsiderationofsuchfactorsasincrease/decreaseinportfoliorentandoccupancy,levelofcashreserves,levelofLTV,debtcosts.

25

Maximum50years(100FiscalPeriod)DrawdownBegins

Respondingtothe2015TaxRevisionStartingFPJan.2017DrawdownPayoutofAtLeast

335millionyenperFP

equivalentto248yenperunits@1,350,000units(asofFPJan.2017)

DPUFloorof4,500yenToBeMaintained

4,500yen

EPU+DrawdownPayout≥4,500yen EPU+DrawdownPayout<4,500yen

DrawdownPayout

EPUEPU

DrawdownPayout

Increasedrawdowntooffsetdeficit

33.5billionyen

(asofFPJuly2016)

RetainedEarningsforTemporaryDifferenceAdjustment(DividendReserve)

LargestAmongJ-REITs



EarningsGuidanceforFPJan.2017&July2017inmillionyen

(1)12thFPResults

(2)13thFPForecast (2)-(1)

ResultsforFPJuly2016

ForecastforFPJan.2017

(announcedSept.6,2016)

Changes NotesForecastforFPJuly2017

(announcedSept.6,2016)

Changes Notes

Revenue


Periodavg.occupancy

96.8%


Periodavg.occupancy

96.2%-44

NewlyAcquiredAssetsIncreasesfromFP2016/7&2017/1acquisitionsSameStore

Off-peakseasondecreaseIncreasefromchangeincontractsfromguaranteedrenttopass-throughrent

+105

-196

+46


Periodavg.occupancy

96.3%+309

NewlyAcquiredAssetsIncreasesfromFP2017/1&2017/7acquisitionsSameStore

Peakseasonincrease

+145

+163

OperatingIncome7,727

(Depreciation:2,568)(Propertytaxes:823


-64

LeasingExpensesNeteffectfromFP2016/7&2017/1buy&sellofproperties

Off-peakseasondecreaseIncreaseinutilitycosts&depreciations

Increaseduetochangesincontractsfromguaranteedrenttopass-throughrent

GAExpensesDecreaseinmanagementfee&increasein

consumptiontaxsettlement

-16+91-47

-32

-15


+59

LeasingExpensesIncreasefromFP2017/1&2017/7acquisitions

PeakseasonincreaseIncreaseindepreciation&expensingof

propertytax

GAExpensesIncreaseinG&Aexpenses

-38-115

-47

-48

OrdinaryIncome 6,206(Fundingcost*:1,510)


+4Decreaseininterestpaymentfromrefinancing

&debtreductionOneoffcostrelatedtothepublicoffering

+81-19


+175Decreaseininterestpaymentfromrefinancing

&debtreductionNooneoffcost

+101+20

NetIncome 6,205 6,210 +4 6,385 +175

DrawdownofRetainedEarnings** 0 349 +349 Retainedearningsafterdividend:33.2bnyen 336 -13 Retainedearningsafterdividend:32.8bnyen

DividendAmount 6,206 6,559 +353 6,721 +162

EPU(yen) 4,773 4,600 -173 Unitsissuedandoutstanding1,350,000units 4,730 +130 Unitsissuedandoutstanding

1,350,000units

DrawdownofRetainedEarnings** 0 259 +259 Begindrawingdown(ofmorethan248yenperunit****)

ofretainedearningsfortemporarydifferenceadjustment 249 -10

Dividendperunit(yen) 4,774 4,859 +85 4,979 +120FFOperUnit***(yen) 6,752 6,523 -229 6,682 +159

FFOPayoutRatio 70.7% 74.5% +3.8pt 74.5% +0.0pt

TotalAssetLTV 52.2% 49.7% -2.5pt 49.7% +0.0pt

26

(3)14thFPForecast (3)-(2)

* Fundingcostsincludeinterestpaymentsforloansandbondsaswellasotherfinancefees.***WhencalculatingthechangesofFFOperunit,decimalsareignored.** “RetainedEarnings”means“DividendReserve”orfromJan.2017“RetainedEarningsforTemporaryDifferenceAdjustment.****Numberofunitsissuedandoutstandingareassumedtobe1,350,000attheendofFP2017/1

FP01-2017(forecast) FP07-2017(forecast) >>> >>> >>> >>>　　　　 >>>　　　　 Target

249yen259yen

4,730yen4,600yen



DPUGrowthDriver

27

AimingtoreachEPUof5,000yen+α,DPUofupto5,300yen,throughrentincrease,lowerfinancingcostandutilizationofacquisitioncapacity

EmphasisonDPU&NAV/UnitGrowthWhileRespondingtoChangesinBusinessEnvironment

PursueRentIncreaseWhileControllingLeasingExpenses

InternalGrowthLong-termFixedInterestRate

Borrowing,MaturityDiversification&ReduceFundingCost

AcquisitionMainlybySponsorSourcingandNegotiatedTransactions,Thereby,AvoidingtheHeatedMarket

FinancePolicyExternalGrowth

TotalDPUgrowthofupto+350yen

Assumptionsarethatthe2,500unitsofthirdpartyallotmentwillbeexecutedinfullandtheissuedamountofADR’sunitswillbe1,350,000unitsandthenumberofoutstandingunitsweretostayunchangedinthisslide.*1 FullperiodcontributionofthreeassetsacquiredbetweenMarchtoApril2017,wherethetotalacquisitionpriceamountingto5.7billionyen.*2 UsedtheassumptionsintheearningsguidelinedisclosedintheFP07-2016Tanshin(JapanesePreliminaryFiscalReport).Consumptiontaxrateisassumedtoberaisedfrom8%to10%.RestorationworksexpectedtobeexecutedinFP01-2018&07-2018areincluded

inthecalculationofdepreciationprojection.*3 InterestpaymentreductionisbasedontheassumptionthatdebtsmaturinginFP01-2018&FP07-2018willberefinancedwithaninterestrateequivalenttowhatwasachievedinFP01-2016&07-2016.*4 AcquisitioncapacityiscalculatedusingtotalassetLTVof53%asalimitwhereacquisitionsarefinancedsolelyondebts.CalculationismadeonforecastfiguresoftotalassetsandoutstandinginterestbearingdebtsforFP07-2017.ThecontributionstotheEPUand

DPUarecalculatedusingyieldafterdepreciationofassettobeacquiredinFP01-2017&FP07-2017,fundingcostandG&AexpenseprojectionsforFP01-2017toFP07-2018.

FulluseofAcquisitionCapacity*4

upto260yenClosingofRentGap

80to90yen

InterestPaymentReduction

50to60yen*3

4,979yen4,859yen

DPU～5,300yen

FullPeriodContributionofNewlyAcquired

Assets

40to50yen*1

EPU5,000yen+α

( )Increaseintaxes

approx.-90to-100yen*2consumptiontax≒-50yen

increaseindepreciation≒-30yenexpensingofpropertytaxes≒-20yen



Note

28

Appendix

29

C-65RESIDIATOWERKami-Ikebukuro



BalanceSheet

FiscalPeriodEndingJuly31,2016　 Assets 　　　　 Currentassets 　

Cashanddeposits 16,504,881Cashanddepositsintrust 9,348,598Operatingaccountsreceivables 206,960Short-terminvestmentsecurities -Prepaidexpenses 390,904Other 5,594Allowancefordoubtfulaccounts △12,475Currentassets 26,444,463

　　 FixedassetsProperty,plantandequipment

Buildings 64,479,451Structures 16,568Machineryandequipment 41,540Tools,furnitureandfixtures 89,192Land 70,312,696Buildingsintrust 130,411,409Structuresintrust 92,936Machineryandequipmentintrust 90,715Tools,furnitureandfixturesintrust 237,124Landintrust 150,205,767Constructioninprogress 70,264Property,plantandequipment 416,047,668

IntangibleassetsLeaseholdright 1,071,902Leaseholdrightintrust 2,112,702Other 111Intangibleassets 3,184,717

InvestmentsandotherassetsSecuritiesinvestments -Long-termprepaidexpenses 820,670Guaranteedeposits 517,397Guaranteedepositsintrust 1,026,585Other 1,632Investmentsandotherassets 2,366,284

Fixedassets 421,598,670　　 Deferredassets

Investmentunitissuanceexpenses 1,359Investmentcorporationbondissuancecosts 115,523Deferredassets 116,883

　　 TotalAssets 448,160,017

inthousandyen

inthousandyen

30

FiscalPeriodEndingJuly31,2016

　 Liabilities 　　　　 Currentliabilities 　

Operatingaccountspayable 343,305

Currentportionofinvestmentcorporationbond 12,000,000

Currentportionoflong-termloanspayable 24,500,000

Accountspayable-other 1,314,314

Accruedexpenses 170,320

Accruedconsumptiontaxes 42,498

Advancesreceived 57,126

Other 26,374

Currentliabilities 38,453,939

　　 Long-termliabilities 　　Investmentcorporationbond 29,500,000

Long-termloanspayable 167,864,329

Tenantleaseholdandsecuritydeposits 1,229,004

Tenantleaseholdandsecuritydepositsintrust 3,197,112

Long-termliabilities 201,790,445

　　 Liabilities 240,244,385

　 Netassets

　　 Unitholders'equity

Unitholders'capital,gross 114,936,698

Surplus

Capitalsurplus 53,220,279

Reservefordividend 33,552,162

Unappropriatedretainedearnings(undisposedloss) 6,206,491

Surplus 92,978,933

Unitholders'equity 207,915,632　　 Netassets 207,915,632　 Liabilitiesandnetassets 448,160,017

inthousandsyeninthousandsyen



FiscalPeriodEndingJuly31,2016(fromFebruary1,20156toJuly31,2016)

A.RevenuefromPropertyLeasing

RentalRentincome 13,727,850Facilitycharge 687,268Parkingfee 442,620

Subtotal 14,857,738Otherrevenuesrelatedtopropertyleasing

Incomefromleasingrights,etc. 72,903Miscellaneousincome 513,409

Subtotal 586,312

Totalrevenuesfrompropertyleasing 15,444,051

B.RentalExpenses

TaxesandDuties 823,752Propertymanagementfees 1,087,353Utilities 243,723Repairsandmaintenance 505,055Insurance 24,758Trustfee 73,123Otherrentalexpenses 765,773Depreciationandamortization 2,568,776

Totalrentalexpenses 6,092,317

C.OperatingIncomefromPropertyLeasingActivities(A-B) 9,351,734

FiscalPeriodEndingJuly31,2016(fromFebruary1,2016toJuly31,2016)

　 Operatingrevenue 　　　Rentrevenue-realestate 15,444,051Dividendincome -Gainonsalesofrealestateproperties -Operatingrevenue 15,444,051

　 Operatingexpenses 　　Expensesrelatedtorentbusiness 6,092,317Lossonsales 3,837Assetmanagementfee 1,116,385Assetcustodyfee 9,670Administrativeservicefees 60,628Directors'compensations 3,600Taxesanddues 239,631Provisionofallowancefordoubtfulaccounts 3,883Baddebtsexpenses 90Otheroperatingexpenses 186,187Operatingexpenses 7,716,233

　 Operatingincome 7,727,818Non-operatingincome

Interestincome 10,182Interestonsecurities 728Reversalofdistributionspayable 1,712Claimcompensationincome -Other 372Non-operatingincome 12,996

Non-operatingexpensesInterestexpenses 1,037,562Interestexpensesoninvestmentcorporationbonds 212,764Amortizationofinvestmentunitissuanceexpenses 1,359Amortizationofcorporationbondsissuanceexpenses 17,634Investmentunitissuanceexpenses 1,421Borrowingrelatedexpenses 260,255Other 3,355Non-operatingexpenses 1,534,354

　 Ordinaryincome　 6,206,459　 Incomebeforeincometaxes 6,206,459

Incometaxes-current 605Incometaxes 605

　 Netincome 6,205,854Retainedearningsbroughtforward 637

　 Unappropriatedretainedearnings(undisposedloss) 6,206,491

ProfitandLossStatement

inthousandsyeninthousandsyen

31

Rentrevenueincreaseduetohigheroccupancy

+97



ResultsforFiscalPeriodendedJuly2016

MaintainedHighOccupancy,DecreasedFundingCost

InternalGrowth

4,5774,773

InitialDividendForecast

4,590ActualDividend

4,774

InitialGuidance

ActualDividend

4,578

+184

-6Decreaseinrentalrevenue

duetopropertysale

FP2016/1Result

ChangesfromInitialEarningsGuidance(perunityen)

ChangesfromPreviousFiscalPeriodendedJan.2016Earnings(perunityen)

ExternalGrowth InternalGrowth Finance

inmillionyen

inmillionyen

4,590

4,773

Increaseinrentrevenueduetoincreasein

occupancy

+73

No.ofProperties 255Occupancy 96.5%


Decreaseininterestpayments

+16

Lowerfundingcost

+12

32

FP2016/7Result

ActualDividend

4,774

fromFebruary1,2016toJuly31,2016

Decreaseinutilitycosts

+39


FP2016/7Result

-5Increaseinmanagementfeeduetohigherprofit

-13Expensingofpropertytaxes

anddepreciation

-39Increasein

managementfeeduetohigherprofit

Finance

InitialGuidance

FPJul.2016Results diff

Revenue 15,363 15,444 +80

Operatingincome 7,509 7,727 +217

Ordinaryincome 5,967 6,206 +238

Netincome 5,967 6,205 +238

Earningsperunit(yen) 4,590 4,773 +183

Dividendperunit(yen) 4,590 4,774 +184

FPJan.2016Results

FPJul.2016Results diff

Revenue 15,082 15,444 +361

Operatingincome 7,489 7,727 +238

Ordinaryincome 5,951 6,206 +254

Netincome 5,951 6,205 +254

Earningsperunit(yen) 4,577 4,773 +196

Dividendperunit(yen) 4,578 4,774 +196

Rentrevenueincreaseduetonewlyacquired

properties

+82

+196

+67Optimizationofrenovationcost

ExternalGrowth

Optimizationofrenovationcost

+57


249

2591

4,7304,600

4,773



EarningsGuidanceforFPJan.2017&July2017

ExternalGrowth

AimingforEPUGrowth,DividendwithLowDownwardRisk

DividendForecast

4,979DividendForecast

4,859

-81Declinein

operatingincomeduetooff-peak

season

Rentrevenueincreaseduetonewlyacquired

properties

+68

InternalGrowthFP2017/7Forecast260propertiesOccupancy96.3%

FP2016/7Result255propertiesOccupancy96.8%

-174Dilutionduetopublicofferingof

units

inmillionyen FP2016/7Result(a) FP2017/1Forecast(b) diff(b-a) FP2017/7Forecast(b) diff(c-b)

Revenue 15,444 15,399 △44 15,709 +309

Operatingincome 7,727 7,663 △64 7,723 +59

Ordinaryincome 6,206 6,210 +4 6,386 +175

Netincome 6,205 6,210 +4 6,385 +175

Earningsperunit(yen) 4,773 4,600 △173 4,730 +130

DrawdownofReserve(yen) - 259 +259 249 △10

Dividendperunit(yen) 4,774 4,859 +85 4,979 +120

33

-14Increasein

consumptiontaxsettlementloss

Atleast335millionyenofretainedearningswillbedrawn

downeveryFPstartingFP2017/1

FP2017/1Forecast257propertiesOccupancy96.2%

-25Increaseindepreciation&expensingofproperty

taxes

inperunityen

EPU

DrawdownperUnit

Decreaseinfundingcost

+52

Rentrevenueincreaseduetonewlyacquiredproperties

+79

Rentrevenueincreaseduetopeek-season

+36

Decreaseinfundingcost

+85

ActualDividend

4,774

-35Increasein

depreciation&expensingofpropertytaxes

-35Increasein

managementfeedueto

higherprofit

Finance ExternalGrowth InternalGrowth Finance

Thedrawdownswillbeusedtostabilizedividends

➕



PortfolioDiversificationPolicy

NumberofBedrooms ～30㎡～40㎡～50㎡～60㎡～70㎡～80㎡～90㎡ over90㎡

Studio S S C C L L L L

1Bedroom S C C C L L L L

2Bedroom - C C F F F F L

3Bedroom - - F F F F F L

4Bedroom～ - - - - F F F L

Unittypes Investmentratio*3

Single ～50%

Compact 20～40%Family 20～40%Large ～10%

Unittypes Investmentratio*3

Dormitory upto20%

InvestmentRegions*1Investmentratio*2

Originally Revised

Tokyo23Wards70～

100%TokyoCentral7Wards 40～60%

CentralTokyoex7Wards 20～40%

OtherRegions

0～30%TokyoMetropolitan(ex.Tokyo23Wards) 5～20%

MajorRegionalCities 5～20%

Studio 1R,1K,STUDIO1Bedroom 1DK,1LDK2Bedroom 2DK,2LDK,1LDK+S3Bedroom 3DK,3LDK,2LDK+S4Bedroom～ 4DK,4LDK,3LDK+S,orunitswithmorerooms

S = SingleTypeUnits mostlyforsinglesC = CompactTypeUnits mostlyforsingles,couplesorsmallfamiliesF = FamilyTypeUnits mostlyforfamiliesL = LargeTypeUnits mostlyforforeignexecutives

DormitoryTypeUnits Theunitssharecommonbathroomsandlaundryspaceswithinintheproperty

■ Inadditiontotheabove,we invest in the followingunittype.

＊Note

1. OftheTokyo23Wards,Chiyoda,Shibuya,Shinjuku,Meguro,SetagayaandShinagawawardsareclassifiedasTokyoCentral7WardsandtheremainingwardsareclassifiedasCentralTokyo.OtherRegionsareTokyoMetropolitanArea(TokyoMetropolisexcludingtheTokyo23Wards,prefecturesofKanagawa,SaitamaandChiba)andMajorRegionalCities.

2. Investmentratiosarecalculatedbasedonacquisitionprice.

3. Investmentratiosarecalculatedbasedonleasablearea.

Unit-typeDefinition

Floorplan Unittypes

Life&SeniorHouseKohoku2,CollegeCourtTanashiandCocofumpHiyoshiarecategorizedasDormitorytypeduetotheircharacteristics

34

* Revisedtheinvestmentregionbysimplifyingthecategorytojusttwo,Tokyo23WardsandOtherRegionsandsettheInvestmentratioguidelineforeachregion.

Single

5.2% 5.7%*4BookValueNOIYield

13.5yrs*5 11.0yrsBuildingAge

atthetimeofmerger afterthetransactions

ImprovingYieldandReducingAverageAge

ThefiguresinthisslideareallbasedondataasofApril18,2017.*1 WeightedaverageNOIyieldofacquisitions

=TotalannualNOIasenteredontheappraisalofacquisitions+Totaloftheacquisitionprices×100%*2 WeightedaverageNOIyieldofdispositions=TotalactualannualNOI÷Totalofthehistoricalacquisitionprices×100*3 Weightedaveragebuildingage isacquisitionpriceweightedaverageasofthetimeofacquisitionordisposition.Properties

thatwillbeacquiredbetweenafterFP2016/7toApril18,2017,wherethescheduledacquisitiondatehavearangeinthedate,themostlatestdateisusedtocalculatetheaverageage.

*4 ThefollowingfiguresareusedtocalculatedtheBookValueNOIYield.AnnualizedNOI÷FP2016/7endbookvalue,wheretheNOIisannualizedusingtheactualdaysinoperationduringtheFP2016/7.FortheassetacquiredafterendofFP2016/7toApril18,2017,theappraisalNOIisusedforannualizedNOIandtheacquisitionpriceisusedforbookvalue.

*5 WeightedAverageageofbuildingsheldatthetimeofmergerasofApril18,2017.*6 TheSponsorGroupappliestoItochuCorporation,whoistheparentcompanyofADR’sassetmanagementcompany,andits

subsidiaries.*7 TheassetsacquiredfromtheSponsorGroupincludes19propertiesdevelopedbytheSponsorGroupand6propertieswhich

werenotdevelopedbutwarehousedaccordingtoAdvanceResidence’srequest.The19properties’acquisitionpricetotal is34.2billionyen.The6properties’acquisitionpricetotalis9.1billionyen.

*8 Bridge Funds are property funds which are often TK and where ADR has a right of first refusal on the assets undermanagement.



BuildingaHighQualityPortfolio

innumberofresidentialunits

TransactionssincetheMerger

TheSponsorGroup•6•7 BridgeFunds•8 Thirdpartyand

Others Total

No.ofProperties 25 42 48 115TotalAcquisitionValue(bnyen) 43.4 52.4 70.5 166.3

ShareofSources 26.1% 31.5% 42.4% 100%

AcquisitionFocusedonSingle-typeUnits

BalancedandDiversifiedAcquisitionSources

Acquisitions Dispositions

No.ofProperties 115 43

TotalValue(AcquisitionPrice) 166.3bnyen 69.6bnyen

WeightedAverageNOIYield 5.8%＊1 4.6%＊2

WeightedAverageBuildingAge*3 4.8yrs 13.3yrs

AcquisitionsandDispositionsSincetheMerger

35

asofApril.18,2017

UnittypeInvestmentRatio(byleasablearea)

Single Compact Family Large Dormitory Others Total

TokyoCentral7Wards +858 +1 -37 -170 0 -1 +651CentralTokyoex7 +1,893 +721 +431 +13 0 +13 +3,071Tokyo23Wards +2,751 +722 +394 -157 0 +12 +3,722TokyoMetropolitan +440 +10 -105 0 -748 -4 -407MajorRegionalCities +1,807 +1,098 +323 +63 0 0 +3,291OtherRegions +2,247 +1,108 +218 +63 -748 -4 +2,884

Total +4,998 +1,830 +612 -94 -748 +8 +6,606

attimeofMerger

afterallscheduledtransactions

0% 25% 50% 75% 100%

4%

3%

1%

3%

5%

9%

26%

29%

27%

26%

37%

30%

Single Compact Family Large Dormitory Offices&Stores



SeniorHousingMarket

36

GrowingSeniorHousingMarketInvestmentPolicy

SeniorHousingHoldings

Advantages Specifics

Location Residentialarea8minwalkfromYokohamaSubwayGreenline,Hiyoshi-HonchoStation

FeatureFacilitiesto

providemedicalcare

Dayservice,homenursing,pharmacy,nursingoffice,medical

clinicRentContract

Lowupfrontpayment,

reasonablerent

Payonly2mth.depositupfront

SizeLargerthan

minimum500millionyen

Acquisitionprice:1,050millionyen

OperatorPartofTSE1st

Sect.listedGroup GakkenCocofumpCorporation*

S-22Life&SeniorHouseKohoku2FP07-2016ActualNOIYield7.3%

S-29CocofumpHiyoshiFP07-2016ActualNOIYield6.7%

GrowingSeniorHousingMarket

RiskPremiumConsiderationConsideringoperationalrisksandpossibilityofissuesarisingfromoperatorcollectingupfrontlump-sum payment from tenants, certainamountofriskpremiummustbeaccounted.

Withtherecentriseinprice,reasonablypricedpropertiesarecurrentlynon-existent.

PreferenceTowardsRSHSSBetweenprivatenursinghomeandRegisteredSenior Housing with Supportive Services(RSHSS), RSHSS are the preferred type ofasset.

They are easier to convert to regular rentalmultifamily residence and aremore stable tooperate having an affordable move-in fee (2month deposit) and a relatively low rentburden.

100

125

150

175

200

2010 2015 2020 2025 2030 2035 2040

NationTotal Sapporo Sendai Tokyo23Wards YokohamaNagoya Kyoto Osaka Fukuoka

Populationtrendof65yearsorolder(Indexedusing2010figureas100)

Healthytoweak MinorNursingNeeds MajorNursingNeeds

PrivateRetirement/NursingHomes

PublicNursingHomesPublic

RetirementHomes

RegisteredSeniorHousingwithSupportiveServices

Area TokyoMetropolitan

Location Yokohama,Kanagawa

Acquisitionprice 1,670millionyen

No.ofrentableunits 78units

Operator SeikatsuKagakuUn-EiCo.,Ltd.

LevelofOut-of-pocketMonthlyBurden

Dependency

500Kyenandabove

400Kto500Kyen

300Kto400Kyen

250Kto300Kyen

160Kto250Kyen

130Kto160Kyen

100Kto130Kyen

60Kto100Kyen

* GakkenCocofumpCorporationisaleadingoperatorofRegisteredSeniorHousingwithSupportiveServices(RSHSS),operating76RSHSSasofSept.23,2016.

High

Low

Medium

http://www.adr-reit.com/en/portfolio/p_data/index.html?did=11263

C-50RESIDIAShin-Itabashi

P-3RESIDIANakameguro

C-28RESIDIAOji

P-85RESIDIAKomazawa

ActualNOIyield6.1%

ActualNOIyield6.2%

ActualNOIyield6.4%

ActualNOIyield6.3%

Location Itabashi-ku,Tokyo

Noofunits 67units

Completion Aug.2009

Location Kita-ku,Tokyo

Noofunits 61units

Completion Feb.2005

Location Setagaya-ku,Tokyo

Noofunits 59units

Completion Oct.2008

Location Meguro-ku,Tokyo

Noofunits 88units

Completion Feb.2005

ActualNOIyield5.7%Location Itabashi-ku,Tokyo

Noofunits 45units

Completion Feb.2007

C-66RESIDIATakashimadaira


Noofunits 44units

Completion Feb.2007

C-67RESIDIAShimurasakaue


Noofunits 94units

Completion Mar.2007

C-68RESIDIAShimurasakaueIIActualNOIyield5.6%


Noofunits 36units

Completion Mar.2007

C-69RESIDIAShimurasakaueIII



DormitoriesandStudentApartments

S-11TOKYOStudent-HouseWako

S-23CollegeCourtTanashi

ActualNOIyield

6.6%

* ActualNOIyield=FPJuly2016actualannualizedNOI÷bookvalue×100%.

Location Wako,Saitama

Noofunits 127unitsCompletionDate Apr.1990

Location Nishi-Tokyo,Tokyo

Noofunits 91unitsCompletionDate Feb.2010

No.ofproperties ActualNOIyield* Occupancy(Residentialportion) Noofrentableunits Totalofacquisitionprice Investmentratioof

portfolio

19properties 6.3% 100% 1,709units 18,099millionyen 4.1%*duetoguaranteedrentcontracts

37

asofApr.18,2017

ActualNOIyield

7.8%

No.ofdormitoriesservingbreakfast

anddinner 2properties

StudentapartmentsDormitories

S-30RESIDIASagamihara

C-74RESIDIANerima

S-15RESIDIAOkurayama

C-77RESIDIAOgikuboII

ActualNOIyield5.6%

ActualNOIyield5.0%

ActualNOIyield6.4%

ActualNOIyield5.9%

Location Sagamihara,Kanagawa

Noofunits 111units

Completion May2004

Location Yokohama,Kanagawa

Noofunits 64units

Completion Mar.1998

Location Suginami-ku,Tokyo

Noofunits 36units

Completion Mar.2007

Location Nerima-ku,Tokyo

Noofunits 34units

Completion Mar.2005

ActualNOIyield6.3%


Noofunits 45unitsCompletio

nFeb.2007

R-8RESIDIAKobePortIsland

ActualNOIyield7.3%

Location Kobe,Hyogo

Noofunits 404units

Completion Mar.2007/Feb.2008

R-38RESIDIAHirosedori

Location Okayama,Okayama

Noofunits 108units

Completion Mar.2004

R-60RESIDIAOkayama-EkimaeActualNOIyield7.2%

ActualNOIyield5.8%Location Kyoto,Kyoto

Noofunits 23units

Completion Mar.2005

R-61RESIDIAKyoto-Okazaki

ActualNOIyield6.6%Location Kyoto,Kyoto

Noofunits 154units

Completion Feb.1999

R-2RESIDIAImadegawa

Location Sendai,Miyagi

Noofunits 63units

Completion Feb.2010

Studentapartmentsarenormalapartmentsbutwherethenewtenantsareonthewholeexclusivelystudents. 17properties



InternalMigrationStatistics

PopulationInflowtoCentralTokyoandMajorRegionalCitiesContinues NetInflowisPre-dominantlyYoungerGeneration

Tokyo23Wards

MajorRegionalCities

TokyoMetropolitanAreaCity

ADR’sInvestmentRatio 71%

TokyoPrefecture

Tokyo’sPopulationInflowbyAgeGroup

Single&CompactTypeUnits

* TheratioisfornumberofsingleandcompacttypeunitsinTokyo23wards.

ADR’sInvestmentRatio 9% ADR’sInvestmentRatio* 48%

ResidentialNeedsofYoungerGeneration

MigrationStatisticsofMajorCitiesinJapan

38

no.ofpeople50,000

60,000

70,000

Tokyo23Wards0

3,000

6,000

Yokohama

0

6,000

12,000

Sapporo Sendai Nagoya Kyoto Osaka Fukuoka

2013 2014 2015

ADR’sInvestmentRatio 19%

no.ofpeople no.ofpeople

no.ofpeople

Source: “ReportonInternalMigrationinJapan”StatisticsBureau,MinistryofInternalAffairsandCommunications(2015);“ReportonInternalMigration”StatisticsDivision

-35,000

0

35,000

70,000

agesunder20

ages20tound

er30

ages30tound

er6060orolder



HousingStarts

HousingStartsHalvedfromthePeaksinceLehmanShock

Source:MinistryofLand,Infrastructure,TransportationandTourism,PolicyBureau,InformationPolicyDivision,ConstructionStatisticsOffice“HousingStarts”(RCandSRCConstructionRentedCollectiveHousing)(2015)

Tokyo23Wards MajorRegionalCities

TokyoMetropolitanArea

ADR’sInvestmentRatiointheRegion71%



Units

Units

Units

Units

Units

Units

Units

Units

39

0

6,500

13,000

2000 2005 2010 2015

Sapporo

0

3,250

6,500

2000 2005 2010 2015

Sendai

0

8,000

16,000

2000 2005 2010 2015

Nagoya

0

2,500

5,000

2000 2005 2010 2015

Kyoto

0

10,000

20,000

2000 2005 2010 2015

Osaka

0

6,500

13,000

2000 2005 2010 2015

Fukuoka0

3,500

7,000

2000 2005 2010 2015

Yokohama

0

22,500

45,000

2000 2005 2010 2015

Tokyo23Wards



Theo

retica

lInd

exed

Ren

t

60

80

100

120

140

BuildingAge(years)

0 5 10 15 20 25

Single-typeRentCompact-typeRent

MeasurestoReduceRentDeclinesCausedbyAging

GradualdeclineinCompetitiveness

Large-scalerenovationsofcommonareasandexteriors

Renovationsofindividualapartmentunits

* FiguresareindexedtheoreticalrentcategorizedbyyearandbuildingageusingactualrentsprovidedbyAtHomeCo.,Ltd.,ofwhichSumitomoMitsuiTrustResearchInstituteCo.,Ltd.statisticallyprocessedusinghedonicmethod.* Analysiswasconductedseparatelybetweenrentdatafromsingle-typeunits(18m2to30m2)andcompact-typeunits(30m2to60m2)ofapartmentin23wardsofTokyo.

Byhavingalong-termmanagementplanREITsaimtomaintainorevenimprovecompetitivenessofits

propertiesundermanagement.

Providinglivingenvironmentmatchingthetenants’needs

Supplyofnewproperties Equipmentsbecomeobsolete

Qualitydeclineduetowearing Changeintenants’needs DailyRepairsEquipmentMaintenance

BuildingMaintenance TimelyCapitalExpenditures

RentsDeclineduetoAging Measurestakentopreventorreducerentdeclines

DailyCleaning

40

80

90

100

110

120

01/2001 11/2004 10/2008 09/2012 07/2016

01/2001 11/2004 10/2008 09/2012 07/2016



RenovationExamplesinADR’sProperties

Individualapartmentunitupgradingrenovations

Cost:3,490thousandyen/unit(ofwhich887thousandyen

isfortheupgrade)

P-73RESIDIAShibaura Buildingage25years

CommonarearenovationCost:128millionyen

Individualapartmentunitupgradingrenovations

Cost;3,680thousandyen/unit(ofwhich1,097thousandyenisfortheupgrade)

CommonarearenovationCost:32millionyen

before

before

Bytakingpropermeasurescompetitivenesscanbemaintained

before

before

buildingage10yrs.

* RentsforRESIDIAShibauraareindexedbybasingtheaverageperm2rentduring2001as100.

S-19RESIDIAKichijoji Buildingage21years

buildingage15yrs.

buildingage15yrs. buildingage20yrs.

* RentsforRESIDIAKichijojiareindexedbybasingtheaverageperm2rentduring2001as100.

41

120

110

100

90

80

AcquiredDec.2004

Large-scalerenovationFeb.2010

Impactofthemeasurestaken

AcquiredJan.2005

Large-scalerenovationDec.2011

buildingage20yrs.

after

after

ExamplesofMeasuresTaken

after

after



BrandStrategy

IfRESIDIAtenantsmovetootherRESIDIAapartments,tenantsdonothavetopaykeymoneynorbrokerfee.Thereforetenantscan

savemovingcostandADRcankeephighoccupancy.

24hours,7daysaweek,RESIDIAcustomersupportfortenants.Providinghousekeepingservices(ex.cleaning)andemergency

responses(ex.waterleak,keylost),etc.

RESIDIALeasingWebsitehttp://www.residia.jp/

RESIDIAShibuyaBuildingSign

RESIDIACustomerSupport

MovingSupportfromRESIDIAtoRESIDIA

TheBrand

BrandingthroughLeasingWebsite&BuildingSigns

TenantServices

42

(including to be acquired properties that are scheduled to have their names changed to RESIDIA)

+

RESIDENCE“Residence” connotes quality and stateliness

ARCADIAa greek word representing

pastoral paradise

Residia is composed from the following words

246 properties which are mainly located in central Tokyo

KOBE

OSAKA

KANAGAWA

SAPPORO

CHIBAKYOTO

SENDAI

FUKUOKA

TOKYO

NAGOYA

OKAYAMAKAMEYAMA

Handedouttoanytenantswhorequested,provisions,helmets,portabletoilet,etc.HandingoutEmergencyKits(onlyfortenantsinMetropolitanAreaproperties)

“KAJITAKU”provideshousekeepingservices.KAJITAKU~TenantService~

http://www.residia.jp

GRESBisanindustry-drivenorganizationcommittedtoassessingthesustainabilityperformanceofrealestateportfolios(public,privateanddirect)aroundtheglobe.Thedynamicbenchmarkisusedbyinstitutionalinvestorstoengagewiththeirinvestmentswiththeaimtoimprovethesustainabilityperformanceoftheirinvestmentportfolio,andtheglobalpropertysectoratlarge.



Sustainability

43

MidtoLong-termMeasurestoRetain&IncreaseAssetValue&RaiseUnitholdersValue

ContributiontotheCommunity

InstallationofLEDLightings

Large-ScaleRepairsandEquipmentRenewalsandUpgrades

InstallationofAEDs

AEDsthatareopentopublicuseareinstalledin42properties.EmergencyMapsEmergency maps showing evacuation routes, available incommonareaof255properties.

In2016,ADRcontinuedtoparticipateintheGRESBSurvey,afterbeingthefirstresidentialJ-REITtoparticipateinthesurveyin2014.

Propertieswithexceptionallyhighenvironmental&socialawareness

ParticipatedinGRESBSurvey2016

Lightingsforcommonareaof2propertiesreplacedwithenergyconservingLED.(LEDlightingsinstalledin29propertiesattheendofJuly2016)

DBJGreenBuildingAwardedto5properties**

P-76ParkTowerShibauraBaywardUrbanWing

Retainassetvalue,extendeconomiclifeandreducecarbonfootprintthroughrepairs,renewalsandupgrades.　DuringtheFiscalPeriodJuly2016large-scalerepairsdoneon1properties,valueenhancementworkson41unitsof13properties.(Trackrecordsincethemerger*:large-scalerepairson19properties,upgradeson19properties194units)

NO.1HighestNumberofResidentialCertificateAwarded***

EmergencyKits

AED

EmergencyMap

DistributingEmergencyKits

Distributed1,155emergencykitstotenants.(thekitconsistsofemergencyrations,helmets,portabletoilets,etc.)

2016GRESBSurveyResult

GreenStar

5つの認証スコアがありますが、表示する場合には､必ず貴社が日本政策投資銀行から通知を受けた「ＤＢＪ Green Building」ロゴマークを選択してください。下図の基本デザインから縮小または拡大して使用してください。.aiデータはCS3以下では使用しないでください。CS4以上が無い場合は必ず.jpgデータを使用してください。

●

●

●

※表示の表現については　　を参照してください。03

日本政策投資銀行が、環境・社会への配慮が優れた不動産を認証する「DBJ Green Building 認証」において、十分な「環境・社会への配慮」がなされたビルとして認証されました。

日本政策投資銀行が、環境・社会への配慮が優れた不動産を認証する「DBJ Green Building 認証」において、優れた「環境・社会への配慮」がなされたビルとして認証されました。

日本政策投資銀行が、環境・社会への配慮が優れた不動産を認証する「DBJ Green Building 認証」において、非常に優れた「環境・社会への配慮」がなされたビルとして認証されました。

日本政策投資銀行が、環境・社会への配慮が優れた不動産を認証する「DBJ Green Building 認証」において、極めて優れた「環境・社会への配慮」がなされたビルとして認証されました。

日本政策投資銀行が、環境・社会への配慮が優れた不動産を認証する「DBJ Green Building 認証」において、国内トップクラスの卓越した「環境・社会への配慮」がなされたビルとして認証されました。

DBJ Green Building2015




2015DBJ Green Building

基本デザイン_ 1

01

１２

３ 4

5

!!

!!

GRESB B.V. Postbus 75801 1070AV Amsterdam Netherlands

E: [email protected] W: www.gresb.com!

!

T: +31 (0)20 7740220 KvK: 55416071

BANK (ING): 4849991 VAT Number: 851699121B01

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InstallationofVendingMachinew/DonationFunctionality

Thevendingmachinesareinstalledin24properties.

VendingMachine

*asofSept.26,2016

** ThefivepropertiesareP-50RESIDIANishi-Azabu,P-55RESIDIATowerMeguro-Fudomae,P-76 ParkTowerShibauraBaywardUrbanWing,C-65RESIDIATowerKami-IkebukuroandS-20PacificRoyalCourtMinatoMiraiOceanTower.

*** BasedonmaterialspublishedbyDevelopmentBankofJapansasofJuly31,2016andconsolidatedbyADInvestmentManagementCo.,Ltd.

DBJGreenBuildingCertification

EnvironmentalConsiderations



CostReductionsincetheMerger

PropertyManagement

Fees

Others

ElectricityBillforShared

Spaces

CustodialFees

BuildingManagement

Fees

AppraisalFees

32

LoweringCoststhroughEconomyofScale

　45total

■BuildingManagementFees

65

71

total

total

52

　86

totaltotal

total

■ LEDLighting■AppraisalFees　

■PropertyManagementFees ■CustodialFees

■PropertyInsuranceFees

■ElectricityBillforSharedSpaces

Totalcostreductionsincethemerger 352millionyen/annumFPJuly2016costreduction 23millionyen/annum

■ InternetProvider

inmillionyen/annum

*Allun-showndecimalsareroundeddown

44

FP07-2016 2PreviousFPs 84

FP07-2016 0.6PreviousFPs 51



FP07-2016 0.9PreviousFPs 70




DebtStructure

TheLineupof26LendersIncludes3megabanks,3majortrustbanks

TotalInterestBearingDebt

233.8billionyen

Lenders TermOutstanding

Amount(bnyen)

SumitomoMitsuiTrustBank,TheBankofTokyo-MitsubishiUFJ

MizuhoBank3y 20.0

InvestmentCorporationBonds Loans

CommittedLinesofCredit

45

IssueDateMaturity

Sept.2011

Apr.2012

Sept.2012

Apr.2013

Nov.2013

Apr.2014

Apr.2015

Oct.2015

Jun.2016

3yrs #15*4bnyen0.86%

5yrs #138bnyen1.27%

#164bnyen1.08%

#178bnyen0.87%

#231.5bnyen0.326%

7yrs #142bnyen1.68%

#184bnyen1.23%

10yrs #193bnyen1.32%

#212.5bnyen1.04%

#222bnyen0.726%

#241.5bnyen0.846%

12yrs #202bnyen1.41%

15yrs #253.0bnyen0.90%

FirstresidentialJ-REITtoissue10,12and15yearbonds

* #13hasbeenredeemedonSept.2016,#15hasbeenredeemedonApril2015.

asofJuly31,2016

InvestmentCorporationBonds18%

InsuranceCo.s3%

CentralCo-opBanks3%

RegionalBanks7%

OtherMajorBanks17% TrustBanks

25%

MegaBanks28%

LendersLoan

Outstanding(bnyen)

%share

SumitomoMitsuiTrustBank 30.4 15.8TheBankofTokyo-MitsubishiUFJ 30.4 15.8MizuhoBank 18.6 9.7SumitomoMitsuiBankingCorporation

17.0 8.9MitsubishiUFJTrust&Banking 16.8 8.7DevelopmentBankofJapan 13.7 7.2MIzuhoTrust&Banking 11.1 5.8AozoraBank 10.6 5.5ResonaBank 8.4 4.4TheNorinchukinBank 7.0 3.6ShinseiBank 6.0 3.1TheBankofFukuoka 5.0 2.6TaiyoLifeInsurance 3.0 1.6TheNishi-NipponCityBank 2.6 1.4TheYamaguchiBank 2.5 1.3TokioMarine&NichidoFireInsurance

1.0 0.5MitsuiSumitomoInsurance 1.0 0.5NipponLifeInsurance 1.0 0.5TheGunmaBank 1.0 0.5TheKagawaBank 1.0 0.5TheIyoBank 1.0 0.5The77Bank 1.0 0.5TheTokyoTominBank 0.5 0.3TheHiroshimaBank 0.5 0.3TheChugokuBank 0.5 0.3TheBankofKyoto 0.5 0.3

Total 192.3 100

0

100,000

200,000

300,000

400,000 TSEREITResidentialIndex TSEREITResidentialIndex TSEREITIndex TOPIX



UnitPriceChart

yen

2ndPublicOfferinglaunchedJanuary12,2012

closing@144,000

＊NAVandBPSareex-dividendfigures

BankofJapanannouncesassetpurchaseprogram

October5,2010

TSEListingMarch2,2010

1stPublicOfferinglaunched

June4,2010closing@120,600

3rdPublicOfferinglaunchedJanuary8,2013

closing@180,000

＊ TOPIX, TSE REIT Index and TSE REIT Residential Index are re-indexed by using Advance Residence’s March 2, 2010 closing price of 112,500 yen as base price.

KeyFigures FP01-2011 FP07-2011 FP01-2012 FP07-2012 FP01-2013 FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

Marketcapitalization168.8bnyen

closing@172,300158.9bnyen











closing@284,600

DailyAverageTradingvolume

0.44bnyen3,247units

0.31bnyen1,917units

0.27bnyen1,907units

0.46bnyen3,160units

0.54bnyen3,208units

1.29bnyen6,055units

0.68bnyen3,174units

0.62bnyen2,684units

0.81bnyen2,922units

0.92bnyen3,181units

0.85bnyen3,344units

1.26bnyen4,512units

LTV(Totalassetsbase) 52.4% 53.5% 54.6% 53.7% 53.8% 51.2% 52.1% 51.0% 50.1% 51.6% 51.4% 52.2%

NAVperUnit(yen) 152,749 154,360 156,459 155,966 158,313 164,311 171,850 182,367 198,261 207,281 216,739 223,586

exDividendReserve(yen) 113,307 117,984 120,504 124,465 127,061 136,917 144,656 156,497 172,452 181,471 190,929 197,776

BPS(yen) 159,564 156,548 156,140 152,689 152,440 153,020 152,821 155,220 155,160 155,161 155,161 155,161

exDividendReserve(yen) 120,122 120,172 120,185 121,188 121,188 125,626 125,626 129,351 129,351 129,351 129,351 129,351

ImpliedCAPrate 5.3% 5.5% 5.6% 5.4% 4.8% 4.7% 4.5% 4.3% 3.8% 4.1% 4.2% 4.1%

4thPublicOfferinglaunchedJanuary9,2014

closing@224,800

FP07-2016EndJul.31,2016

closing@284,600

46

AnnouncedthereleaseofallcollateralJune15,2011

AcquiredcreditratingofAA-fromJCRJuly26,2011

IncludedintheFTSEEPRA/NAREITIndex

June7,2012

Proposedanintroductionofmanagementfeestructurelinkedtounit-holders’interest

Sept.9,2013

Themanagementco.becomesan100%subsidiaryofItochuGroup

June25,2015

CreditratingfromJCRupgradedtoAAfromAA-

January13,2015

2010/3 2010/7 2011/1 2011/7 2012/1 2012/7 2013/1 2013/7 2014/1 2014/7 2015/1 2015/7 2016/1 2016/7



MajorUnitholders

IncreaseinOverseasOwnership asofJuly31,2016

47

Name of Unitholders Holdings (units) % share of issued and outstanding

　JapanTrusteeServicesBank,Ltd.(Tr.Acc.) 335,096 25.8%

TheMasterTrustBankofJapan,Ltd(Tr.Acc.) 129,942 10.0%

Trust&CustodyServicesBank,Ltd.(SecuritiesInv.Tr.Acc.) 78,198 6.0%

TheNomuraTrustandBankingCo.,Ltd.(Inv.Tr.Acc.) 47,015 3.6%

ITOCHUCorporation 34,800 2.7%

Trust&CustodyServicesBank,Ltd.(CashinTr.TaxableAcc.) 15,862 1.2%

TheFujiFireandMarineInsuranceCo.,Ltd. 14,382 1.1%

StateStreetBankandTrustCompany505001 14,373 1.1%

StateStreetBank-WestPensionFundClients-Exempt505233 13,773 1.1%

　MizuhoTrust&BankingCo.,Ltd. 11,257 0.9%

Number of Units Number of Unitholders

Units (%) Unit-holders (%)

Japanese Financial Institutions 904,295 69.6% 189 1.1%

TrustBanks 636,534 49.0% 14 0.1%

RegionalBanks 131,017 10.1% 57 0.3%

LifeInsurance 53,774 4.1% 10 0.1%

SecuritiesCompanies 28,117 2.2% 22 0.1%

CasualtyInsurance 17,420 1.3% 7 0.0%

CreditUnions&Co-ops 20,241 1.6% 37 0.2%

ShinkinBanks 14,603 1.1% 41 0.2%

CityBanks 2,589 0.2% 1 0.0%

Other Japanese Corporations 63,291 4.9% 267 1.5%Foreign Corporations and Individuals 225,316 17.3% 276 1.6%Domestic Individuals and Others 107,098 8.2% 16,828 95.8%

Total 1,300,000 100.0% 17,560 100.0%

0%

25%

50%

75%

100%

FP07-2013 FP01-2014 FP07-2014 FP01-2015 FP07-2015 FP01-2016 FP07-2016

8.2%8.9%9.2%9.9%11.1%12.0%13.4%17.3%15.1%14.7%15.0%18.3%19.6%23.2% 4.9%5.0%5.0%5.0%

5.5%5.6%6.0%

69.6%71.1%71.1%70.0%65.1%62.8%57.4%

JapaneseFinancialInstitutions OtherJapaneseInstitutions ForeignInstitutionsandIndividuals DomesticIndividualsandOthers



PortfolioMapasofApril.18,2017

48

No.ofProperties

260(includingassets-to-be-acquired)

19 1020

4269

66

64

67

68Hakata

Hakata Ward Office

Fukuoka Prefectural Government Office

Chuo-ku

Hakata-ku

Sawara-ku

Fukuoka City Botanical Garden

Sanyo

Shinkansen Line

Kagoshima

Main Line

Chiyoda-ku

Chuo-ku

Minato-ku

Shinjuku-ku

Bunkyo-kuTaito-ku

Sumida-ku

Koto-ku

Shinagawa-ku

Meguro-ku

Ota-ku

Setagaya-ku

Shibuya-ku

Nakano-ku

Suginami-ku

Toshima-ku

Kita-ku

Arakawa-ku

Itabashi-ku

Nerima-ku

Adachi-ku

Katsushika-ku

Edogawa-ku

Ikebukuro

Shinjuku

Shibuya

ShinagawaMeguro

Kamata

Ueno

Kinshicho

Tokyo

5365

24

6260 66

263991

25

70

298151

389

75

45

31

92

4

6885

88

13

34

7

6319

90

15

21

96 7237

22 16 5267

2359

124 12

39 42

1745

4834

63

86

71

51

47

159543

41

16

55

215826

1865

6867

69

66

28

50

70

56

60 36

36

5340

46 3562

29

7

1022 27

3361

32

2

38

6425

44 135981

414793

9

4287

32

33

69

84

10

56

79

6136

14

38

94

7455

4335

64

2

76

7386

95

3040

50

58 48

4998

99

97

19

87

23

49

3154

57

77

76

78

75

74

73

79

72

80

82 83

100

101

110

102

103

104105

106

108

37 524 8 84109 85

60

OkayamaOkayama

Tsuy

ama

Line

Kibi Line

Sanyo

Shinkansen Line

Uno Line

Okayama University

Okayama Prefectural Government

Okayama ity Office

Kounan Airport

Office

Fukuoka

Okayama

: Tokyo Central 7 Wards

: Tokyo 23 Wards

154950

29 2

111455 12

44

8

39

6

35

41

7273

40

46

51

59

61

Mt. Maya

Osaka

Kyoto

Tokaido Main Line

Osaka

Kyoto

Kobe

Mt. Rokko

Mt. Myoken

Mt. Kenpi

Tokaido Main Line

Nara Line

Katamachi

Line

KansaiMain Line

Sanyo

Shinkansen Line

Sanin Main Line

13

38

37

56 54

52

57

62

Tohoku Shinkansen Line

Tohoku Main Line

Senzan Line

Taihaku-ku Wakabayashi-ku

Aoba-ku

SendaiAobayama Park

Tohoku University

Sendai City Athletic Stadium

2648

2531

34 24 5863

6545

Hakodate Main Line

Nishi-ku

Chuo-ku

Shiroishi-kuSapporo

JRA Sapporo Racecourse

Yanaga Hokkaido Museum

Clock Tower

Kita-ku

14

26

25 27

24

17

22

42

11

19

7

16

1528

5

22 29

12

23

3120

30

32

Kawaguchi

Kashiwa

Higashi-Matsudo

Musashikosugi

Kichijyoji

Tachikawa

Hachioji

Shin-Yokohama

Yokohama

Kawasaki

Tokyo

Chiba

Kanagawa

4

17

43

16

3027 32

362147

70

53Nagoya

Nagoya Castle

International Hotel Nagoya

Nagoya Dome

Higashi-ku

Naka-ku Chuo M

ain Li

ne

Tokaido Main Line

Tokaido

Shinkansen Line

Kansai

Main Line

Tsu

Yokkaichi

Kansai Main Line

5

KameyamaSuzuka Circuit

Kisei Main Line

Osaka

Kameyama

Nagoya

Sendai

Sapporo

:Major Regional Cities

:Tokyo Metropolitan Area



Portfolio

49

No. PropertyName LocationCompletion

DateRentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue

(milyen)

UnrealizedProfitandLoss(%)

PMLPeriodEndOccupancy

P-2 RESIDIAShimazuyama Shinagawa-ku,Tokyo 12-2004 115 2,860 0.7% 3,060 2,414 26.7% 4.3% 95.8%

P-3 RESIDIANakameguro Meguro-ku,Tokyo 2-2005 88 1,730 0.4% 1,990 1,451 37.1% 2.6% 100.0%

P-4 RESIDIASetagaya-Tsurumaki Setagaya-ku,Tokyo 3-2002 28 1,229 0.3% 1,220 1,147 6.3% 7.3% 92.5%P-7 RESIDIAIkejiriohashi Setagaya-ku,Tokyo 8-2005 42 1,230 0.3% 1,350 1,174 14.9% 3.1% 88.6%

P-9 RESIDIAKudanshita Chiyoda-ku,Tokyo 3-2004 86 2,270 0.5% 2,540 2,065 23.0% 2.9% 93.6%

P-10 RESIDIAHatagaya Shibuya-ku,Tokyo 2-2006 35 1,130 0.3% 1,190 1,078 10.4% 7.3% 95.4%P-13 RESIDIASakurajosui Setagaya-ku,Tokyo 7-2006 39 1,120 0.3% 1,250 1,073 16.5% 7.0% 92.7%

P-14 RESIDIAKita-Shinagawa Shinagawa-ku,Tokyo 2-2007 120 2,720 0.6% 2,920 2,577 13.3% 4.3% 100.0%

P-15 RESIDIAYoyoginomori Shibuya-ku,Tokyo 3-2007 22 732 0.2% 718 713 0.7% 4.4% 82.4%P-16 RESIDIAShinjuku-EastIII Shinjuku-ku,Tokyo 2-2009 39 750 0.2% 855 731 16.8% 4.3% 97.5%

P-19 LeopalaceUdagawachoMansion Shibuya-ku,Tokyo 8-2001 30 588 0.1% 695 567 22.4% 8.2% 100.0%

P-21 RESIDIAShinjuku-EastII Shinjuku-ku,Tokyo 2-2004 54 1,380 0.3% 1,610 1,320 21.9% 4.8% 98.8%P-22 RESIDIAShinjuku-East Shinjuku-ku,Tokyo 8-2000 48 941 0.2% 1,090 938 16.1% 5.3% 92.2%

P-23 RESIDIAKanda-Iwamotocho Chiyoda-ku,Tokyo 2-2004 65 1,520 0.4% 2,010 1,422 41.3% 4.1% 95.2%

P-24 RESIDIAAzabujubanII Minato-ku,Tokyo 2-2001 37 874 0.2% 1,000 890 12.3% 3.1% 92.1%

P-25 RESIDIAEbisu Shibuya-ku,Tokyo 1-2001 26 554 0.1% 644 572 12.5% 3.0% 82.3%

P-26 RESIDIAMeguro Shinagawa-ku,Tokyo 10-1999 20 722 0.2% 737 739 -0.4% 6.2% 84.7%

P-29 RESIDIAHirooII Shibuya-ku,Tokyo 11-2005 76 1,660 0.4% 2,040 1,551 31.5% 2.9% 95.3%

P-30 PianettaShiodome Minato-ku,Tokyo 2-2005 67 1,950 0.4% 2,200 1,827 20.4% 5.3% 93.3%

P-31 RESIDIAKomazawadaigaku Setagaya-ku,Tokyo 10-2004 18 333 0.1% 381 314 21.2% 8.5% 85.4%P-32 RESIDIAYoyogi Shibuya-ku,Tokyo 2-2005 16 326 0.1% 391 312 25.3% 11.0% 92.7%

P-33 RESIDIANishi-Shinjuku Shinjuku-ku,Tokyo 2-2005 19 363 0.1% 431 348 23.7% 9.9% 94.3%

P-34 RESIDIAKyodo Setagaya-ku,Tokyo 2-2005 15 286 0.1% 334 269 23.7% 10.6% 87.2%P-35 RESIDIAOimachi Shinagawa-ku,Tokyo 12-2005 48 947 0.2% 1,120 884 26.6% 4.3% 85.3%

P-36 RESIDIAEbisuII Shibuya-ku,Tokyo 1-2006 61 2,280 0.5% 2,770 2,234 24.0% 3.4% 95.0%

P-37 RESIDIAKamiochiai Shinjuku-ku,Tokyo 9-2006 70 1,180 0.3% 1,420 1,111 27.7% 4.8% 97.6%P-38 RESIDIAHigashi-Shinagawa Shinagawa-ku,Tokyo 8-2006 122 2,040 0.5% 2,370 1,940 22.1% 4.0% 97.6%

P-39 RESIDIAMeguroII Meguro-ku,Tokyo 1-2006 34 1,190 0.3% 1,330 1,151 15.5% 6.5% 97.7%

P-40 RESIDIAToranomon Minato-ku,Tokyo 9-2006 63 1,320 0.3% 1,520 1,257 20.8% 3.3% 98.4%P-41 RESIDIAShin-Ochanomizu Chiyoda-ku,Tokyo 3-2006 52 1,160 0.3% 1,460 1,111 31.3% 2.8% 93.9%

P-42 RESIDIAKagurazaka Shinjuku-ku,Tokyo 8-2006 52 918 0.2% 1,040 877 18.5% 2.1% 90.8%

P-43 RESIDIAOimachiII Shinagawa-ku,Tokyo 7-2007 40 1,050 0.2% 1,280 1,002 27.7% 4.8% 85.8%P-45 RESIDIAJiyugaoka Meguro-ku,Tokyo 3-2002 28 1,050 0.2% 1,180 989 19.2% 7.3% 100.0%

P-47 RESIDIASuidobashi Chiyoda-ku,Tokyo 12-2004 65 2,310 0.5% 2,610 2,179 19.7% 2.3% 94.9%

P-48 RESIDIATOWERNogizaka Minato-ku,Tokyo 8-2004 68 3,660 0.8% 3,740 3,475 7.6% 3.5% 96.7%

P-49 RESIDIAAkasaka Minato-ku,Tokyo 5-2004 37 1,180 0.3% 1,370 1,118 22.5% 8.3% 96.9%

P-50 RESIDIANishi-Azabu Minato-ku,Tokyo 7-2004 125 6,780 1.6% 7,420 6,459 14.9% 2.8% 94.6%

P-51 RESIDIADaikanyama Shibuya-ku,Tokyo 7-2004 42 2,150 0.5% 2,050 2,015 1.7% 4.0% 100.0%

P-52 RESIDIAIchigaya Shinjuku-ku,Tokyo 8-2004 85 2,500 0.6% 2,860 2,363 21.0% 3.6% 95.5%

P-53 RESIDIARoppongi-Hinokichokoen Minato-ku,Tokyo 9-1999 89 3,570 0.8% 4,150 3,583 15.8% 6.8% 91.3%P-55 RESIDIATOWERMeguro-Fudomae Shinagawa-ku,Tokyo 1-2007 358 16,500 3.8% 18,200 15,285 19.1% 1.8% 100.0%

P-56 RESIDIASangenjaya Setagaya-ku,Tokyo 1-2005 78 2,760 0.6% 3,380 2,571 31.4% 2.7% 98.3%

P-58 RESIDIAMinami-Aoyama Minato-ku,Tokyo 3-2005 13 728 0.2% 492 708 -30.6% 2.0% 89.2%P-59 RESIDIAKanda-Higashi Chiyoda-ku,Tokyo 10-2003 64 1,620 0.4% 2,050 1,517 35.1% 3.4% 95.6%

P-60 RESIDIAHigashi-Azabu Minato-ku,Tokyo 4-2006 31 1,430 0.3% 1,430 1,358 5.3% 3.2% 96.4%

P-61 RESIDIAEbisu-Minami Shibuya-ku,Tokyo 3-2007 39 2,020 0.5% 2,150 1,954 10.0% 7.1% 97.6%P-62 RESIDIATOWERAzabujuban Minato-ku,Tokyo 1-2003 113 6,190 1.4% 5,990 6,015 -0.4% 0.7% 92.1%


DateRentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue

(milyen)


PML PeriodEndOccupancy

P-63 RESIDIAShibuya Shibuya-ku,Tokyo 6-2006 40 1,250 0.3% 1,510 1,212 24.5% 3.5% 95.4%P-64 RESIDIANakanobu Shinagawa-ku,Tokyo 11-2005 65 1,880 0.4% 2,280 1,783 27.8% 3.4% 95.4%P-65 RESIDIAAzabudai Minato-ku,Tokyo 2-2006 47 1,610 0.4% 1,760 1,555 13.2% 4.6% 95.9%P-66 RESIDIAShibadaimonII Minato-ku,Tokyo 8-2006 48 1,740 0.4% 1,800 1,689 6.5% 3.3% 95.9%

P-67 RESIDIAKanda Chiyoda-ku,Tokyo 6-2006 43 1,140 0.3% 1,390 1,097 26.7% 4.9% 94.6%P-68 RESIDIASangenjayaII Setagaya-ku,Tokyo 3-2006 34 1,280 0.3% 1,450 1,228 18.0% 4.4% 97.0%P-69 RESIDIANishi-ShinjukuII Shinjuku-ku,Tokyo 5-2007 74 1,830 0.4% 2,130 1,732 22.9% 10.9% 96.5%P-70 RESIDIAHiroo-Minami Shibuya-ku,Tokyo 8-2007 26 923 0.2% 987 880 12.1% 2.8% 86.7%P-72 RESIDIAMejiro-Otomeyama Shinjuku-ku,Tokyo 12-2002 19 974 0.2% 1,060 927 14.3% 4.9% 100.0%P-73 RESIDIAShibaura Minato-ku,Tokyo 9-1991 153 4,670 1.1% 5,460 4,450 22.7% 2.8% 96.8%P-74 RESIDIAGotenyama Shinagawa-ku,Tokyo 1-2007 16 930 0.2% 914 891 2.6% 7.9% 100.0%P-75 RESIDIAYutenji Meguro-ku,Tokyo 8-2006 118 5,260 1.2% 5,810 5,083 14.3% 7.8% 96.5%

P-76 ParkTowerShibauraBaywardUrbanWing Minato-ku,Tokyo 5-2005 191 9,570 2.2% 10,900 9,048 20.5% 3.6% 97.2%

P-79 RESIDIAKamimeguro Meguro-ku,Tokyo 1-1993 16 878 0.2% 963 851 13.1% 7.7% 100.0%P-81 WindsorHouseHiroo Shibuya-ku,Tokyo 6-2003 12 1,750 0.4% 1,440 1,656 -13.1% 4.8% 84.2%P-84 RESIDIAKita-Shinjuku Shinjuku-ku,Tokyo 2-1997 26 1,460 0.3% 1,590 1,390 14.3% 8.8% 84.6%P-85 RESIDIAKomazawa Setagaya-ku,Tokyo 10-2008 59 870 0.2% 1,170 844 38.5% 10.0% 100.0%P-86 RESIDIAShibauraKAIGAN Minato-ku,Tokyo 1-2010 72 2,400 0.6% 2,920 2,367 23.3% 4.4% 97.0%P-87 RESIDIAIchigaya-Yakuoji Shinjuku-ku,Tokyo 8-2008 98 2,070 0.5% 2,480 2,028 22.2% 3.0% 96.4%P-88 RESIDIAYoga Setagaya-ku,Tokyo 6-2008 66 1,523 0.4% 1,810 1,571 15.2% 10.3% 92.4%P-89 RESIDIATOWERNakameguro Meguro-ku,Tokyo 3-2007 70 3,300 0.8% 4,230 3,373 25.4% 2.4% 94.4%P-90 RESIDIASasazukaII Shibuya-ku,Tokyo 1-2011 167 3,760 0.9% 4,430 3,757 17.9% 4.2% 97.5%P-91 RESIDIAMeguroIII Meguro-ku,Tokyo 1-2010 31 950 0.2% 1,250 968 29.0% 2.6% 94.2%P-92 RESIDIAJiyugaokaII Setagaya-ku,Tokyo 10-2007 17 778 0.2% 949 787 20.5% 5.4% 96.7%P-93 RESIDIAKudanshitaII Chiyoda-ku,Tokyo 1-2012 48 1,240 0.3% 1,610 1,250 28.8% 2.6% 95.0%P-94 RESIDIAOmoriII Shinagawa-ku,Tokyo 3-2012 90 1,620 0.4% 2,050 1,631 25.7% 2.2% 95.9%P-95 RESIDIAShirokane-Takanawa Minato-ku,Tokyo 3-2012 53 1,480 0.3% 1,920 1,492 28.6% 6.7% 100.0%

P-96 RESIDIANakaochiai Shinjuku-ku,Tokyo 3-2008 187 3,656 0.8% 4,230 3,806 11.1%A2.9%B2.9%C3.0%

95.6%

P-97 RESIDIANakameguroII Meguro-ku,Tokyo 8-2006 50 1,119 0.3% 1,350 1,133 19.1% 2.7% 88.1%P-98 ARTISCOURTMinamiaoyama Minato-ku,Tokyo 7-2008 23 1,720 0.4% 1,880 1,743 7.8% 3.9% 95.5%P-99 RESIDIAYotsuya-Sanchome Shinjuku-ku,Tokyo 5-2009 90 2,090 0.5% 2,690 2,118 27.0% 3.8% 98.9%P-100 RESIDIATakanawa-Katsurazaka Minato-ku,Tokyo 3-2006 45 900 0.2% 1,030 952 8.1% 5.4% 93.5%P-101 RESIDIAEbisuIII Shibuya-ku,Tokyo 3-2006 26 611 0.1% 727 654 11.2% 3.3% 90.9%P-102 RESIDIAShinjukugyoen Shinjuku-ku,Tokyo 10-2006 38 687 0.2% 819 728 12.4% 5.2% 87.4%P-103 RESIDIAMinami-Shinagawa Shinagawa-ku,Tokyo 10-2013 50 1,177 0.3% 1,320 1,217 8.4% 8.7% 100.0%P-104 ChesterCourtOchanomizu Chiyoda-ku,Tokyo 3-2007 118 3,117 0.7% 3,760 3,185 18.0% 2.4% 94.7%P-105 RESIDIAKanda-IwamotochoII Chiyoda-ku,Tokyo 4-2007 48 1,280 0.3% 1,520 1,317 15.4% 2.8% 93.7%P-106 RESIDIAShinagawa Shinagawa-ku,Tokyo 6-2007 36 980 0.2% 1,150 1,010 13.8% 4.0% 94.8%P-107 RESIDIAYoyogiII Shibuya-ku,Tokyo 1-2008 31 839 0.2% 936 903 3.6% 8.4% 97.4%P-108 RESIDIANakanobuII Shinagawa-ku,Tokyo 4-2014 44 917 0.2% 980 952 2.9% 3.9% 95.7%P-109 RESIDIAOchanomizuII Chiyoda-ku,Tokyo 3-2015 28 821 0.2% 885 853 3.7% 4.1% 94.6%C-1 RESIDIAMitsukoshimae Chuo-ku,Tokyo 2-2005 105 1,920 0.4% 2,370 1,611 47.0% 3.3% 98.4%C-2 RESIDIAKamata Ota-ku,Tokyo 3-2005 166 2,640 0.6% 3,420 2,181 56.8% 4.7% 97.3%C-3 RESIDIAIkebukuro Toshima-ku,Tokyo 3-2005 60 1,520 0.4% 1,730 1,414 22.3% 7.1% 100.0%C-4 RESIDIABunkyo-Hongo Bunkyo-ku,Tokyo 7-2005 65 1,680 0.4% 2,070 1,576 31.3% 4.6% 100.0%C-5 RESIDIAAsakusabashi Taito-ku,Tokyo 8-2005 47 1,060 0.2% 1,350 952 41.7% 2.9% 97.5%C-6 MaisonEclaireeEkoda Nerima-ku,Tokyo 3-1993 94 953 0.2% 1,080 921 17.3% 9.2% 96.8%C-7 RESIDIAUeno-Okachimachi Taito-ku,Tokyo 2-2006 127 3,160 0.7% 3,580 2,905 23.2% 2.1% 96.3%C-8 RESIDIABunkyo-HongoII Bunkyo-ku,Tokyo 1-2006 70 1,623 0.4% 1,800 1,561 15.3% 3.6% 100.0%C-9 RESIDIARyogoku Sumida-ku,Tokyo 2-2006 48 913 0.2% 1,120 861 30.0% 9.1% 100.0%

（asofJuly31,2016）



Portfolio

50

No. PropertyName Location CompletionDate

RentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue(milyen)



C-10 RESIDIAHigashi-Ginza Chuo-ku,Tokyo 9-2006 169 5,251 1.2% 5,480 5,078 7.9% 4.3% 100.0%C-12 RESIDIANihonbashi-NingyochoII Chuo-ku,Tokyo 1-2007 137 3,180 0.7% 3,590 3,005 19.4% 4.6% 98.7%C-13 RESIDIAOmori-Higashi Ota-ku,Tokyo 8-2007 81 1,980 0.5% 1,980 1,866 6.1% 3.8% 95.7%C-15 RESIDIAKinshicho Sumida-ku,Tokyo 11-2007 157 4,200 1.0% 4,460 4,054 10.0% 7.2% 99.5%C-16 RESIDIANegishi Taito-ku,Tokyo 12-2005 28 856 0.2% 899 828 8.5% 7.7% 96.6%C-17 RESIDIAShinkawa Chuo-ku,Tokyo 2-2003 83 1,880 0.4% 2,200 1,779 23.6% 5.3% 97.9%C-18 RESIDIAKamiikebukuro Toshima-ku,Tokyo 12-2001 44 558 0.1% 683 553 23.3% 6.4% 97.4%C-19 RESIDIAShin-nakano Nakano-ku,Tokyo 6-2002 24 352 0.1% 477 360 32.4% 3.8% 90.1%C-21 RESIDIABunkyo-YushimaII Bunkyo-ku,Tokyo 3-2004 63 1,010 0.2% 1,150 941 22.2% 5.3% 95.3%C-22 RESIDIATsukiji Chuo-ku,Tokyo 12-2005 54 1,460 0.3% 1,780 1,349 31.9% 3.4% 97.7%C-23 RESIDIASasazuka Suginami-ku,Tokyo 3-2000 96 1,800 0.4% 2,090 1,814 15.2% 6.9% 99.1%C-24 RESIDIAKyobashi Chuo-ku,Tokyo 1-2005 52 1,220 0.3% 1,460 1,137 28.4% 3.4% 100.0%C-25 RESIDIATamagawa Ota-ku,Tokyo 9-2004 98 1,300 0.3% 1,590 1,198 32.7% 5.9% 98.0%C-26 RESIDIAKorakuen Bunkyo-ku,Tokyo 10-2004 31 603 0.1% 740 558 32.6% 3.5% 100.0%C-27 RESIDIAGinza-Higashi Chuo-ku,Tokyo 9-2004 94 2,000 0.5% 2,400 1,867 28.5% 4.0% 99.2%C-28 RESIDIAOji Kita-ku,Tokyo 2-2005 61 867 0.2% 1,020 793 28.5% 3.2% 100.0%C-29 RESIDIAMejiroII Toshima-ku,Tokyo 7-2005 63 1,050 0.2% 1,210 989 22.3% 2.3% 92.7%C-31 RESIDIATsukishima Chuo-ku,Tokyo 2-2006 40 1,100 0.3% 1,270 1,033 22.9% 6.8% 95.6%

C-32 RESIDIAKamataII Ota-ku,Tokyo 9-2006 78 1,360 0.3% 1,610 1,289 24.8% 4.0% 94.1%

C-33 RESIDIATsukishimaII Chuo-ku,Tokyo 9-2006 105 2,440 0.6% 2,880 2,322 24.0% 3.8% 95.7%C-34 RESIDIAKinshichoII Sumida-ku,Tokyo 1-2008 99 2,380 0.5% 2,590 2,264 14.4% 4.7% 97.0%C-35 RESIDIABunkyo-Otowa Bunkyo-ku,Tokyo 8-2003 104 3,380 0.8% 3,920 3,161 24.0% 4.7% 91.0%C-36 RESIDIABunkyo-Sengoku Bunkyo-ku,Tokyo 2-2003 33 707 0.2% 857 647 32.4% 5.0% 100.0%C-37 RESIDIABunkyo-Yushima Bunkyo-ku,Tokyo 2-2003 39 1,050 0.2% 1,270 969 31.1% 6.9% 94.2%C-38 RESIDIAIkegami Ota-ku,Tokyo 7-2003 19 378 0.1% 404 351 15.1% 8.5% 91.0%C-39 RESIDIANihonbashi-Ningyocho Chuo-ku,Tokyo 3-2004 25 557 0.1% 727 512 41.8% 5.6% 96.3%

C-40 RESIDIABunkyo-SengokuII Bunkyo-ku,Tokyo 4-2005 45 1,440 0.3% 1,600 1,364 17.2% 4.1% 95.2%

C-41 RESIDIAIriya Taito-ku,Tokyo 12-2004 49 990 0.2% 1,120 899 24.5% 5.4% 100.0%C-42 RESIDIANihonbashi-Hamacho Chuo-ku,Tokyo 8-2006 45 1,310 0.3% 1,520 1,260 20.6% 4.5% 91.3%C-43 RESIDIAShin-Okachimachi Taito-ku,Tokyo 3-2007 69 1,860 0.4% 2,080 1,773 17.3% 3.0% 97.6%C-44 RESIDIAChidoricho Ota-ku,Tokyo 9-2006 60 1,290 0.3% 1,390 1,221 13.8% 5.0% 95.0%C-45 RESIDIAShinkawaII Chuo-ku,Tokyo 2-2003 36 1,320 0.3% 1,510 1,218 23.9% 3.9% 98.5%C-46 RESIDIAMejiro Toshima-ku,Tokyo 1-1999 162 6,280 1.4% 7,380 6,167 19.7% 2.6% 93.5%C-47 RESIDIAKasai Edogawa-ku,Tokyo 1-2000 29 683 0.2% 803 675 18.8% 7.0% 96.7%

C-48 RESIDIANihonbashi-Bakurocho Chuo-ku,Tokyo 2-2007 132 5,500 1.3% 6,800 5,167 31.6% 2.4% 98.2%

C-49 RESIDIASuginami-Honancho Suginami-ku,Tokyo 2-2009 194 3,834 0.9% 5,280 3,688 43.1% 4.3% 100.0%

C-50 RESIDIAShinItabashi Itabashi-ku,Tokyo 8-2009 67 888 0.2% 1,190 864 37.6% 8.6% 100.0%C-51 RESIDIAKiba Koto-ku,Tokyo 3-2008 155 1,950 0.4% 2,850 1,933 47.4% 7.2% 100.0%C-52 RESIDIABunkyo-Yushima Bunkyo-ku,Tokyo 12-2008 52 1,129 0.3% 1,450 1,109 30.7% 4.4% 96.9%C-53 RESIDIABunkyo-Honkomagome Bunkyo-ku,Tokyo 3-2008 98 2,340 0.5% 2,850 2,324 22.6% 3.5% 96.8%C-54 RESIDIATsukishimaIII Chuo-ku,Tokyo 2-2008 119 2,570 0.6% 3,510 2,518 39.4% 4.0% 100.0%C-55 RESIDIAMinamisenju Arakawa-ku,Tokyo 3-2007 175 2,580 0.6% 3,460 2,512 37.7% 5.3% 98.6%C-56 RESIDIAOgikubo Suginami-ku,Tokyo 3-2003 101 1,710 0.4% 2,170 1,771 22.5% 4.5% 100.0%

C-57 RESIDIAMonzennakacho Koto-ku,Tokyo 2-2005 68 970 0.2% 1,240 987 25.6% 7.6% 98.5%

C-58 RESIDIAOchanomizu Bunkyo-ku,Tokyo 9-2005 80 2,090 0.5% 2,730 2,078 31.3% 4.2% 92.0%C-59 RESIDIAOmori Ota-ku,Tokyo 3-2006 75 1,150 0.3% 1,420 1,142 24.2% 1.8% 100.0%C-60 RESIDIANakamurabashi Nerima-ku,Tokyo 2-2008 66 1,075 0.2% 1,310 1,060 23.5% 4.5% 97.3%C-61 RESIDIAKachidoki Chuo-ku,Tokyo 2-2008 55 1,805 0.4% 2,350 1,786 31.5% 4.9% 96.1%

No. PropertyName Location CompletionDate

RentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue

(milyen)



C-62 RESIDIABunkyo-OtowaII Bunkyo-ku,Tokyo 2-2008 89 2,268 0.5% 2,870 2,316 23.9% 4.0% 95.6%C-63 RESIDIAKinshichoIII Koto-ku,Tokyo 2-2005 51 651 0.2% 802 664 20.6% 9.6% 100.0%

C-64 RESIDIAKamataIII Ota-ku,Tokyo 3-2007 53 948 0.2% 1,200 945 26.9% 3.5% 95.2%

C-65 RESIDIATowerKami-Ikebukuro Toshima-ku,Tokyo 3-2009 472 8,250 1.9% 10,800 8,257 30.8%Twr2.9%Prk5.4%Anx5.7%

97.6%

C-66 RESIDIATakashimadaira Itabashi-ku,Tokyo 2-2007 45 502 0.1% 600 529 13.3% 4.8% 100.0%C-67 RESIDIAShimurasakaue Itabashi-ku,Tokyo 2-2007 44 580 0.1% 684 611 11.9% 3.4% 100.0%

C-68 RESIDIAShimurasakaueII Itabashi-ku,Tokyo 3-2007 94 1,093 0.3% 1,330 1,139 16.7% 5.6% 100.0%

C-69 RESIDIAShimurasakaueIII Itabashi-ku,Tokyo 3-2007 36 411 0.1% 492 434 13.1% 5.4% 100.0%C-70 RESIDIAIkebukuroWest Itabshi-ku,Tokyo 10-2007 72 1,115 0.3% 1,320 1,131 16.7% 3.0% 95.6%

C-71 RESIDIAOjima Koto-ku,Tokyo 11-2007 87 1,282 0.3% 1,530 1,299 17.8% 6.1% 100.0%C-72 RESIDIAMachiya Arakawa-ku,Tokyo 8-2009 55 1,168 0.3% 1,270 1,201 5.7% 3.2% 96.7%

C-73 RESIDIAUeno-Ikenohata Taito-ku,Tokyo 2-2004 71 1,700 0.4% 1,900 1,795 5.8% 3.8% 93.5%C-74 RESIDIANerima Nerima-ku,Tokyo 3-2005 34 502 0.1% 623 521 19.5% 3.9% 100.0%C-75 RESIDIAHigashi-Nihonbashi Chuo-ku,Tokyo 4-2006 22 378 0.1% 456 402 13.2% 5.8% 100.0%C-76 RESIDIANakano Nakano-ku,Tokyo 11-2006 30 652 0.2% 749 697 7.4% 4.1% 92.4%C-77 RESIDIAOgikuboII Suginami-ku,Tokyo 3-2007 36 460 0.1% 541 495 9.1% 5.1% 100.0%C-78 RESIDIAMinamiyukigaya Ota-ku,Tokyo 3-2008 58 1,299 0.3% 1,490 1,374 8.4% 4.4% 97.5%C-79 RESIDIAAkihabara Taito-ku,Tokyo 4-2007 40 977 0.2% 1,150 1,010 13.8% 5.1% 95.4%C-80 RESIDIAAsakusa-Azumabashi Sumida-ku,Tokyo 9-2007 60 876 0.2% 1,080 908 18.8% 3.5% 98.3%C-81 RESIDIAOomoriIII Ota-ku,Tokyo 12-2012 65 1,395 0.3% 1,560 1,437 8.5% 3.1% 98.6%C-82 RESIDIANihonbashi-BakurochoII Chuo-ku,Tokyo 4-2014 77 1,975 0.5% 2,280 2,037 11.9% 3.8% 98.3%C-83 RESIDIANihonbashi-BakurochoIII Chuo-ku,Tokyo 3-2008 55 1,833 0.4% 2,170 1,894 14.6% 3.7% 94.5%C-84 RESIDIABunkyo-HongoIII Bunkyo-ku,Tokyo 7-2014 48 1,655 0.4% 1,750 1,714 2.1% 4.7% 100.0%C-85 RESIDIAShin-OkachimachiII Taito-ku,Tokyo 3-2015 100 4,650 1.1% 4,990 4,834 3.2% 1.9% 98.8%S-2 ChesterHouseKawaguchi Kawaguchi,Saitama 3-1991 39 770 0.2% 741 716 3.4% 5.5% 100.0%S-4 RESIDIAHigashi-Matsudo Matsudo,Chiba 4-2007 44 1,100 0.3% 1,180 1,046 12.8% 4.6% 97.7%S-5 RESIDIAShin-Yokohama Yokohama,Kanagawa 1-2007 131 1,920 0.4% 1,940 1,798 7.8% 5.6% 100.0%S-7 RESIDIAChofu Chofu,Tokyo 3-2007 41 1,143 0.3% 1,170 1,089 7.4% 5.0% 96.1%S-11 TOKYOStudent-HouseWako Wako,Saitama 4-1990 127 675 0.2% 731 689 6.0% 10.2% 100.0%S-12 RESIDIAKokubunji Kokubunji,Tokyo 2-2003 33 518 0.1% 595 512 16.1% 2.9% 90.7%S-14 RESIDIAYokohama-Kannai Yokohama,Kanagawa 8-2004 102 1,700 0.4% 1,840 1,551 18.6% 8.4% 99.1%S-15 RESIDIAOkurayama Yokohama,Kanagawa 3-1998 64 755 0.2% 910 725 25.5% 5.3% 100.0%S-16 RESIDIAMusashikosugi Kawasaki,Kanagawa 2-2007 68 1,580 0.4% 1,890 1,505 25.6% 7.2% 93.0%

S-17 RESIDIAFunabashiIandII Funabashi,Chiba 3-2007 172 2,730 0.6% 3,060 2,572 18.9% I3.6%II3.4% 100.0%

S-19 RESIDIAKichijoji Musashino,Tokyo 3-1995 48 1,380 0.3% 1,590 1,431 11.1% 9.1% 95.7%

S-20 PacificRoyalCourtMinatoMiraiOceanTower Yokohama,Kanagawa 11-2007 416 14,000 3.2% 15,900 12,152 30.8% 4.5% 100.0%

S-22 Life&SeniorHouseKohokuII Yokohama,Kanagawa 10-2003 78 1,670 0.4% 2,250 1,565 43.7% 6.4% 100.0%S-23 CollegeCourtTanashi Nishi-Tokyo,Tokyo 2-2010 91 810 0.2% 1,090 781 39.6% 7.7% 100.0%S-24 RESIDIAUrayasu Urayasu,Chiba 9-2009 146 2,115 0.5% 2,810 2,112 33.0% 6.7% 98.3%S-25 RESIDIAMinami-Gyotoku Ichikawa,Chiba 2-2005 85 823 0.2% 1,020 835 22.1% 6.6% 97.6%S-26 RESIDIAUrayasuII Urayasu,Chiba 2-2005 74 802 0.2% 981 815 20.3% 7.5% 89.2%S-27 RESIDIAGyotoku Ichikawa,Chiba 2-2005 75 761 0.2% 922 771 19.6% 6.1% 98.7%S-28 RESIDIAKawasaki Kawasaki,Kanagawa 3-2007 104 1,670 0.4% 2,150 1,654 30.0% 4.7% 94.6%S-29 CocofumpHiyoshi Yokohama,Kanagawa 1-2010 85 1,050 0.2% 1,190 1,034 15.1% 7.5% 100.0%S-30 RESIDIASagamihara Sagamihara,Kanagawa 5-2004 111 1,050 0.2% 1,230 1,094 12.4% 6.8% 100.0%S-31 RESIDIAYokohama-Bashamichi Yokohama,Kanagawa 9-2005 28 735 0.2% 1,110 782 41.9% 11.5% 100.0%S-32 RESIDIAHon-Atugi Atugi,Kanagawa 1-2008 49 606 0.1% 683 656 4.1% 11.0% 98.1%S-33 RESIDIAFunabashiIII Funabashi,Chiba 2006/10 43 620 0.1% 679 669 1.5% 5.0% 100.0%




Portfolio

PortfolioafterIncludingthePropertyAcquiredAftertheFP07-2016End

AreaNo.of

PropertiesRentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)AppraisalPrice

(milyen)BookValue(milyen)

UnrealizedProfitandLoss

(%)P TokyoCentral7Wards 88 5,395 170,851 39.4% 193,578 164,809 17.5%C CentralTokyoex7wards 81 6,385 139,774 32.2% 166,907 135,900 22.8%S TokyoMetropolitan 24 2,254 40,984 9.5% 47,662 38,562 23.6%R MajorRegionalCities 62 6,421 82,024 18.9% 100,038 79,961 25.1%

Total 255 20,455 433,635 100.0% 508,185 419,232 21.2%

Area No.ofProperties RentableUnits AcquisitionPrice(milyen)

ShareofInvestment(%)

P TokyoCentral7Wards 89 5,437 172,010 38.9%C CentralTokyoex7wards 83 6,572 144,142 32.6%S TokyoMetropolitan 24 2,254 40,984 9.3%R MajorRegionalCities 64 6,579 85,578 19.3%

Total 260 20,842 442,716 100.0%


DateRentableUnits

AcquisitionPrice(milyen)

AppraisalPrice(milyen)

P-110 RESIDIAMishuku Setagaya-ku,Tokyo 4-2015 42 1,159 1,240C-86 RESIDIAKameido Koto-ku,Tokyo 10-2013 129 2,988 3,190C-87 RESIDIAKoenji Suginami-ku,Tokyo 3-2015 58 1,380 1,480C-72 RESIDIASenri-Fujishirodai Shuita,Osaka 3-2017(scheduled) 90 1,430 1,580C-73 RESIDIASenri-Banpakukoen Shuita,Osaka 10-2005 68 2,124 2,320

Total5Properties 387 9,081 9,810

（asofApril.18,2017）

51


DateRentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue(milyen)



R-2 RESIDIAImadegawa Kyoto,Kyoto 2-1999 154 1,671 0.4% 1,720 1,509 14.0% 10.9% 100.0%R-4 RESIDIAHigashi-Sakura Nagoya,Aichi 2-2006 91 1,290 0.3% 1,390 1,071 29.8% 3.4% 98.9%R-5 RESIDIAKameyama Kameyama,Mie 2-2007 182 1,610 0.4% 1,190 1,556 -23.5% 4.2% 100.0%R-6 RESIDIARyokuchiKoen Toyonaka,Osaka 5-2007 44 979 0.2% 963 907 6.2% 5.7% 88.1%

R-8 RESIDIAKobePortIsland Kobe,Hyogo 9-2007 404 3,740 0.9% 4,070 3,496 16.4% South•Center6.8%North6.7% 100.0%

R-10 RESIDIAHakata Fukuoka,Fukuoka 3-2002 155 1,220 0.3% 1,400 1,153 21.4% 3.4% 98.7%R-11 RESIDIATenjinbashi Osaka,Osaka 2-2000 78 871 0.2% 1,120 868 29.0% 8.3% 98.4%R-12 RESIDIASannomiya-Higashi Kobe,Hyogo 11-2005 161 2,220 0.5% 2,760 2,000 38.0% 3.2% 93.9%R-13 KC21Building Sendai,Miyagi 3-1997 79 900 0.2% 1,020 891 14.5% 2.4% 92.4%R-14 RESIDIAUtubokoen Osaka,Osaka 1-2006 94 1,170 0.3% 1,420 1,070 32.6% 6.6% 94.3%R-15 RESIDIAKyoto-ekimae Kyoto,Kyoto 2-2006 116 1,970 0.5% 2,390 1,814 31.7% 9.9% 98.7%R-16 RESIDIATakaoka Nagoya,Aichi 8-2007 198 2,330 0.5% 3,020 2,173 39.0% 3.5% 94.3%R-17 RESIDIAHibino Nagoya,Aichi 4-1992 124 1,340 0.3% 1,460 1,177 24.0% 3.9% 95.1%R-19 RESIDIATenjin-Minami Fukuoka,Fukuoka 1-2004 56 936 0.2% 1,160 851 36.2% 4.9% 91.1%

R-20 RESIDIAHakataeki-Minami Fukuoka,Fukuoka 1-2003 39 324 0.1% 390 288 35.4% 2.7% 97.4%R-21 RESIDIAHisaya-OdoriII Nagoya,Aichi 2-2005 38 685 0.2% 807 621 29.9% 5.0% 92.6%R-24 RESIDIAMinami-Ichijo Sapporo,Hokkaido 12-2006 179 1,640 0.4% 1,970 1,493 31.9% 0.9% 99.6%R-25 RESIDIAOdori-Nishi Sapporo,Hokkaido 12-2006 103 1,320 0.3% 1,440 1,225 17.5% 1.1% 98.7%R-26 RESIDIAKita-Sanjo Sapporo,Hokkaido 1-2007 100 1,130 0.3% 1,360 1,024 32.7% 1.4% 97.8%

R-27 RESIDIAShirakabe-Higashi Nagoya,Aichi 5-2005 33 831 0.2% 890 771 15.4% 4.1% 94.6%R-29 RESIDIAUzumasa Kyoto,Kyoto 1-2000 48 701 0.2% 743 657 13.0% 13.5% 89.6%R-30 RESIDIAIzumi Nagoya,Aichi 11-2005 122 3,700 0.9% 4,290 3,398 26.2% 3.1% 95.1%R-31 RESIDIAMaruyamaKita-Gojo Sapporo,Hokkaido 2-2007 56 1,050 0.2% 1,200 971 23.5% 1.2% 92.9%R-32 RESIDIATokugawa Nagoya,Aichi 12-2006 27 751 0.2% 868 702 23.6% 3.9% 92.2%

R-34 RESIDIAOdori-Koen Sapporo,Hokkaido 8-2007 109 2,010 0.5% 2,450 1,862 31.5% 0.9% 98.1%

R-35 RESIDIATanimachi Osaka,Osaka 8-2008 108 1,100 0.3% 1,560 1,120 39.3% 7.5% 98.3%R-36 RESIDIAHisaya-Odori Nagoya,Aichi 2-2007 57 652 0.2% 915 645 41.8% 4.8% 95.1%R-37 RESIDIASendai-Miyamachi Sendai,Miyagi 1-2008 67 529 0.1% 723 518 39.4% 2.5% 100.0%R-38 RESIDIAHirosedori Sendai,Miyagi 2-2010 63 494 0.1% 656 486 34.9% 2.8% 100.0%R-39 RESIDIAEdobori Osaka,Osaka 2-2007 127 1,400 0.3% 1,840 1,424 29.1% 8.7% 97.7%

R-40 RESIDIAKyomachibori Osaka,Osaka 3-2007 84 1,000 0.2% 1,320 1,023 29.0% 7.8% 99.0%R-41 RESIDIAEsaka Suita,Osaka 7-2007 68 989 0.2% 1,270 983 29.1% 4.8% 95.3%R-42 RESIDIANishijin Fukuoka,Fukuoka 1-2008 173 2,380 0.5% 2,940 2,329 26.2% 2.6% 98.3%R-43 RESIDIATsurumai Nagoya,Aichi 2-2008 122 1,206 0.3% 1,620 1,185 36.6% 3.6% 96.9%R-44 RESIDIAKobe-Isogami Kobe,Hyogo 3-2008 196 2,740 0.6% 3,640 2,682 35.7% 3.6% 97.3%R-45 RESIDIAKita-Nijyo-East Sapporo,Hokkaido 3-2006 56 894 0.2% 1,110 889 24.7% 1.1% 96.4%

R-46 RESIDIAShinsaibashiWest Osaka,Osaka 2-2007 97 1,921 0.4% 2,400 1,919 25.0% 9.1% 96.4%R-47 RESIDIAMarunouchi Nagoya,Aichi 1-2007 86 972 0.2% 1,220 974 25.2% 2.8% 95.5%R-48 RESIDIASapporo-Ekimae Sapporo,Hokkaido 2-2007 168 1,483 0.3% 2,100 1,477 42.2% 0.7% 98.0%R-49 RESIDIAGosyo-Higashi Kyoto,Kyoto 9-2007 57 1,227 0.3% 1,530 1,227 24.6% 8.9% 90.2%R-50 RESIDIARakuhoku Kyoto,Kyoto 3-2008 75 874 0.2% 1,010 875 15.3% 12.4% 93.6%

R-51 RESIDIAMiyakojimaI&II Osaka,Osaka 9-2006 178 3,232 0.7% 4,570 3,310 38.0% 7.1% 95.7%R-52 RESIDIATOWERSendai Sendai,Miyagi 1-2008 67 1,705 0.4% 2,000 1,777 12.5% 2.3% 91.8%R-53 RESIDIAHigashizakuraII Nagoya,Aichi 2-2006 127 2,862 0.7% 3,660 2,894 26.5% 3.1% 94.7%

R-54 RESIDIATsutsujigaoka Sendai,Miyagi 11-2006 168 1,796 0.4% 2,310 1,808 27.7% EAST2.6%WEST2.7% 94.4%

R-55 RESIDIAKobe-Motomachi Kobe,Hyogo 6-2007 105 1,117 0.3% 1,590 1,130 40.7% 2.3% 95.0%


DateRentableUnits

AcquisitionPrice

(milyen)

ShareofInvestment

(%)

AppraisalPrice

(milyen)

BookValue(milyen)



R-56 RESIDIASendai-Honcho Sendai,Miyagi 6-2007 105 1,117 0.3% 1,590 1,130 40.7% 2.3% 95.0%R-57 RESIDIASendai-Haranomachi Sendai,Miyagi 9-2007 72 593 0.1% 857 600 42.7% 2.1% 97.6%R-58 RESIDIAMinami-IchijoEast Sapporo,Hokkaido 1-2008 85 1,062 0.2% 1,330 1,079 23.2% 1.1% 95.9%R-59 RESIDIAShin-Osaka Osaka,Osaka 2-2014 208 2,644 0.6% 3,420 2,814 21.5% 6.2% 100.0%R-60 RESIDIAOkayama-ekimae Okayama,Okayama 3-2004 108 772 0.2% 934 806 15.9% 1.7% 100.0%R-61 RESIDIAKyoto-Okazaki Kyoto,Kyoto 3-2005 23 227 0.1% 301 239 25.6% 14.1% 100.0%R-62 RESIDIASendai-Ichibancho Sendai,Miyagi 3-2006 103 1,083 0.2% 1,340 1,124 19.2% 2.4% 100.0%R-63 RESIDIAKita-NijyoEastII Sapporo,Hokkaido 2-2007 51 538 0.1% 715 566 26.2% 1.2% 97.8%R-64 RESIDIATakamiya Fukuoka,Fukuoka 2-2007 51 488 0.1% 568 508 11.8% 6.1% 96.9%R-65 RESIDIASoen Sapporo,Hokkaido 2-2007 60 384 0.1% 523 407 28.5% 1.4% 90.0%R-66 RESIDIATenjin Fukuoka,Fukuoka 5-2007 88 1,122 0.3% 1,290 1,159 11.2% 3.4% 90.9%R-67 RESIDIAYakuin-Odori Fukuoka,Fukuoka 6-2007 91 1,123 0.3% 1,310 1,157 13.2% 4.5% 90.1%R-68 RESIDIAHakataII Fukuoka,Fukuoka 9-2007 124 1,358 0.3% 1,530 1,401 9.2% 1.8% 98.1%R-69 RESIDIAKego Fukuoka,Fukuoka 1-2008 86 834 0.2% 1,080 872 23.8% 2.3% 97.7%R-70 RESIDIAShirakabe Nagoya,Aichi 3-2008 70 907 0.2% 1,070 969 10.3% 4.4% 92.6%R-71 RESIDIASakae Nagoya,Aichi 12-2007 77 868 0.2% 955 944 1.2% 4.2% 87.0%

Total255properties 　　20,455 433,635 100.0% 508,185 419,232 21.2% 2.4% 96.6%


General Meeting of Unitholders

Board of Directors

Representative Director and President

Statutory Corporate Auditor

Investment Commitee

Internal Auditor

Compliance Commitee

Compliance and Risk Management Department

Administrations Division

Investment and Asset Management Division

Asset Management Department

Engineering Department

Corporate Management Department

Accounting Department

Compliance Officer

Financial Department

Investment Department



AssetManagementCompanyProfile

ADInvestmentManagementCo.,Ltd.　 http://www.adim.co.jp/AdvanceResidenceInvestmentCorporation http://www.adr-reit.com/en/

Organizational Chart

CompanyProfileName: ADInvestmentManagementCo.,Ltd.Address: 17FJimbochoMitsuiBldg.,1-105Kanda-Jimbocho,Chiyoda-ku,TokyoCompanyRepresentative: KenjiKousaka,RepresentativeDirectorandPresidentAmountofCapital: 300millionyenTypeofBusiness: AssetManagementHistory: March1,2010 MergeswithPacificResidentialCorporation

May17,2005 CompanynameischangedtoADInvestmentManagementCo.,Ltd. February2,2005 EstablishedasJapanResidentialManagementCo.,Ltd.RegistrationsandLicenses: Realestateagent'slicense(TheGovernorofTokyo(3)No.84325) Approvalforadiscretionarytransactionagent(MinisterofLand,Infrastructure,TransportandTourismApproval,No.37) Registeredforafinancialinstrumentsbusiness(KantoLocalFinanceBureauregistrationNo.309)

RegisteredasFirst-Class-ArchitectOffice(TheGovernorofTokyoNo.58856)

1

1

74 8171014

2

30incl.theDivisionHead 33incl.theDivisionHead

Total69excludingoutsidedirectors

Thenumberdenotesthenumberofpeopleworkingin

thesectionordivision

1

1

asofJuly31,2016

asofJuly31,2016

52

ImperialEastGarden

JimbochoStationToeiShinjukuLine

YasukuniDori

HakusanDori

ToeiMitaLine

MetropolitanHighway

TakebashiStation

TokyoParkTower

HitotsubashiSIBldg.

JapanMeteorological

Agency

MarubeniTokyoHeadquarterBldg.

TokyoMetroHanzom

onLine

UchiboriDori

TokyoMetroTozaiLine

KyoritsuWomen’sUniversity

Kowa

Hitotsubashi

Bldg.

KandaPoliceStation

JimbochoTaxOffice

GakushiKaikan

TerraceSquare

Nishikicho

TradSquare

JimbochoMitsuiBldg.

http://www.adim.co.jp

http://www.adr-reit.com/en/

Fees FeeBase MaximumFeeRate

AMFeeI TotalAsset(Previousfiscalend) ×0.20%

AMFeeII NOI*1 ×3.00%

AMFeeIII (AMFeesI+II)×AdjustedEPU*2 ×0.008%

AcquisitionFee AcquisitionPrice ×1.00%

DispositionFee DispositionPrice ×0.50%

MergerFee AcquiredAssetValue ×0.50%



AssetManagementFeeStructure AnAssetManagementFeeStructureMoreInlinewithUnitholders’Interest

※1NOI=GrossOperatingIncomeminusGrossOperatingExpense(excludingdepreciationandlossfromfixedassetretirement.)※2AdjustedEPU=NetIncomeexcludingAMFeeIIIdividedbynumberofoutstandingassetatthefiscalperiodend.

IntroducinganAssetManagementFeethatisCoupledtoNOI*1andAdjustedEPU*2

53

moreinlinewithunitholders’interest

FeeLinkedtoNOI*1FeeLinkedtoTotalAssetSize FeeLinkedAdjustedEPU*2AMFeeI AMFeeIIIAMFeeII

(Previousfiscalend)



SponsorSupport

SupportfromITOCHUGroup

ShareholdersoftheADInvestmentManagementCo.,Ltd.

Being a member of a major conglomeratetrading house, the ITOCHU Group, ADInvestmentManagementCo.,Ltd.,theassetmanagement company, utilizes the supportof ITOCHU Group tomaximize the asset ofAdvance Residence through external andinternalgrowth.

ADInvestmentManagementCo.,Ltd.is100%heldbyITOCHUGroup.

AD Investment Management Co., Ltd

InternalGrowth

ExternalGrowth


SupplyofProperty,MarketInformation,andProperty

Warehousing

ITOCHUCorporation

ITOCHUPropertyDevelopment

Propertymanagement,BuildingManagement&

Leasing

Century21RealEstateofJapan

ITOCHUUrbanCommunity

Asset Management

ITOCHUCorporation ITOCHUPropertyDevelopment

Shareholding　80.6%

54

Shareholding　19.4%



JapaneseRealEstateLeasingContractPractices

InitialFeesandPayments

FeesandPaymentsatRenewal

PaymentsatTermination

KeyMoney Non-refundablepaymentwhichissometimescalled“thankyou”money.

generallyone-month’srent

Deposit Refundablepaymentwhichwillbeusedtocoverdelinquencyandrestorationcost.

generallyone-totwo-month’srent

Rent Paidmonthlyinadvance.Initialmaximumpaymentwillbeone-month’sand30days’rent. one-month’srent

RenewalFee Non-refundablefeetobepaidwhentenantsrenewtheleasecontracts.


AgentFee

Non-refundablefeetobepaidtotherealestateagent.

Industrystandardone-month’srent

Deposit Depositsarerefundedminusrestoration. generallyone-totwo-month’srent

AdvertisementFee

Feetobepaidtotherealestateagent.


ForRent

Real Estate Agent

Tenants

AdministrationFee

Feetobepaidtothepropertymanager.


• StandardleasetermsinJapanaremostlytwoyears.• Tenantsareabletoleavetheleasedspacebeforecontractexpirationwithoutpayingfortheremainingcontractperiod.• Japan’sLeaseLandandHouseLawmakesraisingrentsofexistingcontractsalmostimpossible.

Property Manager

55

A

dvan

ce

Inve

stm

ent C

orpo

ratio

nR

esid

ence

Thismaterialcontainforward-lookingstatementsonfutureoperatingresults,plans,businessobjectivesandstrategiesofthecompany.

Forward-lookingstatementsprovidecurrentexpectationsoffutureeventsbasedonnumberofassumptionsandincludestatementsthatdonotdirectlyrelatetoanyhistoricalorcurrentfacts.Forward-lookingstatementsarenotguaranteesoffutureperformanceandtheCompany'sactualresultsmaydiffersignificantlyfromtheresultsdiscussedintheforward-lookingstatements.

ThismaterialisbasedonJapaneseGAAPunlessotherwisestated.

Thismaterialwasnotcreatedforthepurposeofsolicitinginvestmentinthecompany.Investmentsshouldbebasedonyourownjudgmentandresponsibility.

Advance Residence Investment Corporation20140619

Earnings Presentation 12 - アドバンス・レジデンス投資法 … · 2016-11-24 ·...

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Transcript of Earnings Presentation 12 - アドバンス・レジデンス投資法 … · 2016-11-24 ·...