October 17, 2019
Financial Briefing for the 35th Fiscal Period
Securities code︓8954
ended August 31, 2019
October 17, 2019
BLANK
Table of Contents
OJR at a Glance 3Our Management Philosophy 4Portfolio Status 5
Performance ResultsGrowth Achievement 7Key Takeaways 8Performance Highlights I 9Performance Highlights II 10Initiatives for DPU Growth 11
External Growth StrategyImproving Portfolio Quality through Asset Reshuffle 13New Acquisition I 14New Acquisition II 15New Acquisition III 16Sponsor Pipeline and Acquisition Track Record from Sponsor 17
Internal Growth StrategyOffices -Occupancy Rates and Tenant Turnover- 19Offices -Rent Renewals- 20Retail Facilities 21Residential Properties and Logistics Facilities 22Hotels and Others 23
Financial StrategyFinancial Strategy I 25Financial Strategy II 26Financial Strategy III 27
Initiatives towards ESGInitiatives towards ESG I -Examples- 29Initiatives towards ESG II -Certifications- 30
AppendixDriving Growth of Unitholder Value 32Our Growth Strategy 33Five Period Performance Summary 34Performance Forecast Comparison I 35Performance Forecast Comparison II 36Period-over-Period Performance Comparison I 37Period-over-Period Performance Comparison II 38Portfolio Summary I 39Portfolio Summary II 40Portfolio Map 41Portfolio Growth 42Disposed Properties 43Overview of Appraisal Value 44Appraisal Value List I 45Appraisal Value List II 46Investor Status 47Compliance System for Property Transaction 48Corporate Profile of Asset Management Company 49Glossary I – III 50-52
2
Profile Features
OJR at a Glance
ORIX JREIT Inc.(Abbreviation: OJR)
Corporate name
8954Securities code
ORIX Asset Management CorporationWholly owned by ORIX Corporation
Asset management
company
February and AugustFinancialclosing
date
JCR: AA (Stable)R&I: AA - (Stable )
Ratings
As of financial announcement
on Oct. 17, 2019
June 12, 2002(4th J-REIT and 1st diversified J-REIT to be listedin Japan)
Date of listing
Diversified REIT
We build a portfolio that combines growth, profitability and stability
AUM (Acquisition price)
668 billion yen6th largest among all J-REITsas of Sep 31, 2019
Number of properties as of financial announcementon Oct. 17, 2019
111
Asset type as of financial announcementon Oct. 17. 2019
ORIX Synergy
We carefully invest in properties from our solid pipeline
Approx. 90%(319 billion yen)
Operating Expertise
We continuously enhance our portfolio quality
+12%(Increased for 8 consecutive fiscal periods)+7% (Increased for 12 consecutive fiscal periods)
Ave. Building Age as of financial announcementon Oct. 17, 2019
17.0 years(12.1 years at the end of Aug. 2002)
Percentage of properties acquired from ORIX Group during and after FP23 (Aug. 2013)
Offices53.8%
Retail Facilities
16.3%
Residential Properties
10.2%
Logistics Facilities 5.5%
Hotels and Others 14.1%
TargetOffice ratio
approx. 50%±10%
Rent Fluctuation Rate upon Turnover in officesas of FP35 (Aug. 2019)
Rent Fluctuation Rate upon Renewal in officesas of FP35 (Aug. 2019)
3
Our Management Philosophy
External Growth Strategy• Broad investment opportunities as
a diversified REIT• Ability to replace assets• Utilizing ORIX synergy
Internal Growth Strategy• Flexible leasing options distinctive to
a diversified REIT• Direct property management• Utilizing ORIX synergy
Asset
Enhancing portfolio profitability and stability
Financial Strategy• Reducing financing costs• Improving financial stability• Appropriate cash management
Equity
DebtOptimizingfinancial efficiency
Sustainable growth of
unitholder value
We aim to enhance unitholder value by improving pro fitability and stability of our portfolio, reducingfunding costs and improving financial stability
4
Greater Tokyo Area 70.3%
6 Central Tokyo Wards
41.0%
Remaining Tokyo Wards 10.4%
Other Parts of the Greater Tokyo Area
18.9%
Other Areas29.7%
TargetGreater
Tokyo Area approx.
70%±10%
Occupancy rate NOI yield Yield after
(%) (%) depreciation (%)
Offices 359.9 54 99.1 5.1 4.3 18.8
Retail Facilities 108.9 28 99.7 5.6 4.8 11.8
Residential Properties 68.2 14 95.9 5.7 4.5 12.4
Logistics Facilities 37.1 5 100 5.7 4.3 10.9
Hotels and Others 94.4 10 99.8 5.3 4.1 20.7
Overall Portfolio 668.6 111 99.2 5.3 4.4 17.0
Total acquisitionprice (billion yen)
Average buildingage (year)
Properties
Asset type
Portfolio Status as of financial announcement on Oct. 17, 2019
Portfolio Profile
Portfolio Composition based on Acquisition PriceRent Condition based on Actual Rent
Area
Offices53.8%
Retail Facilities
16.3%
Residential Properties
10.2%
Logistics Facilities 5.5%
Hotels and Others 14.1%
TargetOffice ratio
approx. 50%±10%
5
Fixed rent97%
Variable rent3%
Performance Results
3,200
3,300
3,400
3,500
3,600
3,700
3,800
90
100
110
120
130
140
150
Normalized DPU(right)
OJR stock price (left)
TSE REIT Index (left)
Consistent growth in normalized DPU corresponding to environmental changes
7Growth Achievement
Enhance portfolio quality through asset reshuffle
Note2: OJR stock prices and the TSE REIT Index indicate fluctuations through September 30, 2019, indexed by setting the price and index on April 19, 2018, the release date for earnings for the 32nd fiscal period, as 100.
FY33(Aug. 2018)as of financial announcement
FY34(Feb. 2019)as of financial announcement
FY35(Aug. 2019)as of financial announcement
FY32(Feb. 2018)as of financial announcement
MSCI Japan ESG Select Leaders Index
Disposition ︓3 regional suburban-type retail facilities (A Section of Kobe Momoyamadai Shopping Center, Cross Mall Shimonoseki-Chofu, GRAN MART Tegata)
OJR’s first green bonds issuance
Acquisition ︓Sendai Minamimachidori Building
Acquisition ︓Hotel Universal Port
(yen/unit)Acquisition ︓Felicita Sanjo Kiyamachi
Disposition ︓Okayama Kume Retail Facility
Disposition ︓KN Jiyugaoka Plaza
Acquisition ︓TOKYU REIT Akasaka Hinokicho Building
Credit Rating UpgradeR&I(A+ → AA-)
3.333
3,430
3,540
3,671
Note1: Normalized DPUs are calculated by deducting or adding one-off factors from two-period-ahead-DPU forecast announced at each financial announcement.
Business landscape Our performance result Our strategy
� Opportunities to invest in quality properties are scarce and remains to be challenging
� Improvement in portfolio quality through property dispositions is favored
� Conducted our first asset swap with our peer company by acquiring an office in Akasaka and disposing an office in Jiyugaoka.
� Acquired two urban-type retail facilities conveniently located in major cities (Sendai and Kyoto) from Sponsor
� Disposed a regional suburban retail facilitiy due to concerns over future competitiveness
� Continue to consider asset reshuffle with a focus on improving portfolio quality
� Invest with versatility using our various funding sources. Currently considering offices, urban retail facilities and complex facilities
� Selectively dispose properties with concerns over future competitiveness or profitability. Currently focusing on regional suburban retail facilities
� Office demand remains strong, and vacancy rates are low levels while rents are increasing nationwide
� Maintained high occupancy Overall: 99.2%, Offices: 99.1%
� Rent fluctuation rates for offices during FP35 (Aug. 2019) has improved:
Increase upon turnover: +12%(Increased for 8 consecutive fiscal periods)
Increase upon renewal: +7%(Increased for 12 consecutive fiscal periods)
� 改装
� Continue to drive high occupancy and improve leasing conditions utilizing our direct property management expertise
� Borrowing environment is generally favorable under BOJ’s continuous monetary easing policy
� Increased likelihood of extended low interest rate policy and possibility of further deepening
� LTV: 43.4%. Secured borrowing capacity of 90 billion yen (up to LTV of 50%)
� Issued our first green bonds of 7 billion yen
� Strengthen financial stability while considering to reduce funding costs
� Maintain borrowing capacity to actively pursue suitable acquisition opportunities
� Continue to consider issuing investment corporation bonds including green bonds
� Utilize internal reserves to flexibly deal with temporary factors while considering DPU and contribute to the sustainable growth of unitholder value
Internal grow
thE
xternal grow
thF
inancialstrategy
8Key Takeaways
Our target is to provide mid-to long-term sustainab le growth of unitholder value
Previous financial announcementas of Apr. 18, 2019
Financial announcementas of Oct. 17, 2019
FP37 (Aug. 2020)
Property-related tax to beexpensed per unit (estimate)
Impact on internal reserves from
disposition (Note3) -
Normalized DPU 3,540 yen 3,671 yen
Change and factors+23 yen
131 yen (+3.7%)Internal growth and others: +120 yen
External growth (Asset reshuffle): +11 yen
FP36 (Feb. 2020) 3,540 yen
-
0 yen -2 yen
3,650 yen
DPU
3,252 3,230
3,299
3,489 3,4873,430
3,580 3,540
3,650
6854
3,000
3,100
3,200
3,300
3,400
3,500
3,600
3,700
3,800
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
FP37Aug. 2020
Forecast 1 year ago
Forecast6 months
ago
Forecast 6 months
agoActual
New forecast
New forecast
FP36Feb. 2020
3,755
Performance Highlights IAchieved normalized DPU growth by 3.7%
Performance Forecast Comparison
(yen/unit)
Page 35-36
3,755yen3,580 yen(+175 yen)
Page 37-38
DPU Trend (Note1)
Normalized DPU
Period-over-Period Performance Comparison
Note 1: “Forecast 1 year ago” refers to the DPU forecast as of the financial announcement in the second last fiscal periods and “Forecast 6 months ago” refers to DPU forecasts as of the financial announcement for the last fiscal period.Note 2: “Earthquake restoration at ‘intervillage OH! MAGARI’” refers to a restoration work for the partial damage to the facility such as fallen ceiling material caused by the 2018 Hokkaido Eastern Iburi Earthquake.Note 3: “Impact on internal reserves from disposition” refers to the impact resulting from internal reserves due to the disposition of “KN Jiyugaoka Plaza” exceeding the gains on disposition.
9
Allocated a portion of internal reserves to offset a part of
earthquake restoration expense at “intervillage OH! MAGARI”
(Note2). As for remaining expenses, we plan to allocate gain from
property disposition. Timing and amount are subject to change.
3,710
3,540
3,7103,650
+107
+55
+170
+13-41
-54
-67
-49-1 -23
3,000
3,100
3,200
3,300
3,400
3,500
3,600
3,700
3,800
3,900
Increase in normalized DPU through stable internal g rowth and asset reshuffle despite property disposit ion
DPU change factor
DPU Positive factor Negative factor
Performance Highlights II
(yen/unit)
10
Contribution from properties acquired
(Sendai, Kyoto, Akasaka49%)Internal
growth and others
i. Gain on property
disposition(Okayama,
Jiyugaoka49%)
Impact fromasset reshuffle
(Acquisition: Akasaka51%,Disposition: Jiyugaoka 51%,
Property-related tax to be expensed: Sendai, Kyoto,
Akasaka49%)
iii. Internal reserve of gain
on property disposition
(Okayama, Jiyugaoka49%)
Loss of rental income from properties disposed(Okayama,
Jiyugaoka49%)
Internal reserve from
gain on property
disposition(Jiyugaoka51%)
Internal growth and
others
Absence of one-off factors(i, ii, iii)
ii. Earthquake restoration expense at “intervillage
OH! MAGARI”
FP36(Feb. 2020)
Forecast6 months ago
FP36(Feb. 2020)New forecast
FP37(Aug. 2020)New forecast
Note : Sendai: Sendai Minamimachidori Building, Kyoto: Felicita Sanjo Kiyamachi, Okayama: Okayama Kume Retail Facility, Akasaka: TOKYU REIT Akasaka Hinokicho Building, Jiyugaoka: KN Jiyugaoka PlazaOJR acquired a 49% co-ownership interest in Akasaka on October 1, 2019, and plans to acquire the remaining 51% co-ownership interest on March 4, 2020.OJR disposed a 49% co-ownership interest in Jiyugaoka on October 1, 2019, and plans to dispose the remaining 51% co-ownership interest on March 4, 2020.
The above figures represent a hypothetical impact from each initiative effecting DPU according to the financial performance assumed by OAM based on certain assumptions. We, however, do not provide any guarantee with respect to the probability, the amount and the timing of such impact. In particular, we can not guarantee that the new acquisitions will be completed with the above terms, since the terms are subject to changes due to market conditions. DPU may also change due to other factors not listed above.
Initiatives for DPU Growth
Rent fluctuation rate in existing offices:2.0% per year
Approx. 80 yen per unit
Impact on DPU by multiplying change in forecasted office rental revenue of approx. 10 bil. yen during a fiscal period assumed from contract rents in properties owned by OJR at the end of FP35 (Aug. 2019) by forecasted rent fluctuation rate of 2.0% per year . This 2.0% figure takes into account actual results of change in rents attributable to tenants turnovers/rent renewals in offices from FP32 (Feb. 2018) to FP35 (Aug. 2019) . (Note2)
Variable rate of averagefunding costs:0.04% pt. per year
Approx. 20 yen per unit
Impact on DPU attributable to change in financing-related cost calculated by multiplying balance of interest-bearing liabilities of 291 bil. yen at the end of FP35 (Aug. 2019) by forecasted variable rate (0.04% per year) of averag e funding costs
Acquisition by utilizing FCFof 5 bil. yen
Approx. 30 yen per unit
Impact on DPU during a full fiscal period by utilizing 1 year FCF of 5 bil. yen (Please refer to page 34) for acquisition that generates earning yield after depreciation of approx. 4.0% (after deducting AM fees) (Note1)
Impact on DPU during a full fiscal period by utilizing 10 bil. yen equivalent to approx. 1% of LTV based on total assets out of borrowing capacity of 90 bil. yen at the end of FP35 (Aug. 2019) (Please refer to page 26) for acquisition that generates earning yield after depreciation of approx. 4.0% (after deducting AM fees and funding costs) (Note1)
Note1: This yield indicates the same level of actual yield after depreciation in the portfolio from FP32 (Feb. 2018) to FP35 (Aug. 2019) .Note2: Given frequency of the tenant turnovers or rent renewals in each asset type, DPU impacts by change in rents of offices which account for approx. 50% of our total rental revenue are shown in the above simulation.Note3: OJR makes assumptions that DPU simulations are based on the total of 2,760,000 investment unit outstanding at the end of FP35 (Aug. 2019) .
Acquisition by utilizing borrowing capacity of 10 bil. yen
Approx. 40 yen per unit
External Growth StrategySwift acquisition by using acquisition capacity
Internal Growth StrategyImprove leasing conditions
Financial StrategyReduce average funding costs
An image of each initiative contributing to DPU gro wth
Aim for mid-to long-term stable growth of DPU throu gh a broad variety of strategies
11
External Growth Strategy
OJR’s first asset exchange transaction between our peer J-REIT company. Acquired an office that can leverag e our strength.
13Improving Portfolio Quality through Asset Reshuffle
TOKYU REIT Akasaka Hinokicho Building
(Minato-ku, Tokyo )
KN Jiyugaoka Plaza
(Meguro-ku, Tokyo )
Acquisition Acquisition Disposition
Felicita Sanjo Kiyamachi
(Kyoto-shi, Kyoto )
Sendai Minamimachidori
Building(Sendai-shi, Miyagi )
i. A Section of Kobe MomoyamadaiShopping Center (Land right)(Kobe-shi, Hyogo )
ii. Cross Mall Shimonoseki-Chofu(Shimonoseki-shi, Yamaguchi )
iii. GRAN MART Tegata (Akita-shi, Akita )iv. Okayama Kume Retail Facility (Okayama-shi, Okayama )
i.
iii.
ii.
iv.
Acquired urban-type retail facilities for its stabi lity and disposed regional suburban-type retail facilities in view of future risk
Price:
4,800 million yen
Price:
3,160 million yen
� Immediate focus is on its existing rent gap.
� With a wide range of future options given its scarcity in the area and age (ie; rebuilding or redevelopment)
Total price:
7,020 million yen
Total price:
7,650 million yen
� Stable, but future growth is limited. � Conveniently located in
major cities� Can attract a wide range of
tenants primarily restaurants
� Risk of potential competitors coming into the area
� Elevated early termination risk from major tenants
� Concern in deteriorating future profitability upon major tenants vacating
Offices Retail Facilities
Disposition
14
●Can also expect a wide range of future options, such as rebuilding or redevelopment given its scarcity in the area and age.
Chart 1: New office supply percentage by grade dur ing past ten years (2009-2018)
� Rent has been flat despite the market’s recovery after the global financial crisis.
TOKYU REIT Akasaka Hinokicho BuildingOffices
New Acquisition I
76%
10%
10%4%
Akasaka/Roppongi/Kamiyacho area
Total15%
62%11%
17%
10%
Tokyo central 5 wards
Total27%
Grade A Grade A-Minus Grade B Under Grade B
Note1: To be acquired over the following two periodsI. October 1, 2019 2,352 million yen (Co-ownership interest representing 49%) Ⅱ March 4, 2020 2,448 million yen (Co-ownership interest representing 51%)
Note2: As of the end of August 2019Note3: Prepared by OAM based on a survey data from CBRE Inc. and
disclosure material of the seller.
Grade A : Offices with 10,000 tsubo or more Gross Floor Area (GFA)Grade A-Minus : Offices with 7,000 tsubo or more GFAGrade B : Offices with 2,000 tsubo or more GFAUnder Grade B : Offices with less than 2,000 tsubo GFA←TOKYU REIT Akasaka Hinokicho Building
●Premier location with an approximately 4-minute walk from subway “Akasaka Station.”
●High scarcity with a limited supply of medium-sized offices (refer to Chart 1) in the Akasaka/Roppongi/Kamiyacho area.
●Strong growth potential in current rent (refer to Chart 2). OJR’s robust internal growth capability can be deployed.
●Maintained competitiveness despite 35 years building age with the replacement of the air conditioning system and elevator.
Chart 2: Rent trend of the property and the market
90
100
115
0
20
40
60
80
100
120
140
160
1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Trend of monthly rent including parking rent at TOKYU REIT Akasaka Hinokicho BuildingTrend of assumed achievable rent in the Akasaka/Roppongi/Kamiyacho area (Grade B)
Acquisition price 4,800 million yen (Note1)
Appraisal value 5,100 million yen
Seller TOKYU REIT, Inc.
NOI yield 4.3%
Yield afterdepreciation
4.1%
Occupancy rate 100% (Note2)
Location Minato-ku, Tokyo
Land area 866.61m2
Building area 4,058.92m2
Stories 7
Completion August 1984
15New Acquisition IISendai Minamimachidori BuildingRetail Facilities
Note1: Calculated by dividing Net Operating Income based on the direct capitalization method indicated in the appraisal reports at the time of acquisition by the acquisition price. The figures are rounded to the one decimal place.
Note2: Calculated by dividing (Net Operating Income based on the direct capitalization method indicated in the appraisal reports at the time of acquisition - Depreciation estimated by OAM) by the acquisition price. The figures are rounded to the one decimal place.
Note3: As of end of August 2019
Acquisition price 3,900 million yen
Appraisal value 4,120 million yen
Seller Sponsor
NOI yield 4.7% (Note1)
Yield afterdepreciation
3.4% (Note2)
Occupancy rate 96.0% (Note3)
Location Sendai-shi, Miyagi
Land area 621.36m2
Building area 4,096.42m2
Stories8 stories and with 1underground floor
Completion November 2017
� Relatively new urban-type retail facility developed by the ORIX Group.� Located in an area where both OJR and the ORIX Group are both highly familiar with. OJR currently
owns a neighboring retail facility “aune Sendai”.� Situated in an area in front of Sendai Station, the largest passenger station in the Tohoku region. � Offers easy access to JR Sendai station with an approx. 5-minute walk. Across the street from the
entrance to the subway Sendai station.� Can attract a wide range of tenants by its excellent location. � The current tenants include rental conference rooms, a fitness gym, an upscale restaurant offering local
food, a café, and several pubs, among others.
16
Guest room at “capsule hotel”
New Acquisition IIIFelicita Sanjo KiyamachiRetail Facilities
Facing Takasegawa River
Note: As of end of August 2019
Acquisition price 3,120 million yen
Appraisal value 3,210 million yen
Seller Sponsor
NOI yield 4.2%
Yield afterdepreciation
3.6%
Occupancy rate 100% (Note)
Location Kyoto-shi, Kyoto
Land area 541.00m2
Building area 3,513.42m2
Stories10 stories with 1underground floor
Completion June 2007
� An urban-type retail facility conveniently located approx. 3 minutes walk from Sanjo Station.
� High visibility located on the corner facing SanjoStreet and facing the Takasegawa River offering exceptional views
� Walking distance from famous sightseeing spots such as Kamogawa, Pontocho and Gion. Also located in the center of Kyoto City that can attract strong lodging demand for tourists in Kyoto.
� The current tenants are composed of primarily restaurants, capsule hotel and a yoga studio.
� A long-term fixed agreement with a capsule hotel operator on the upper four floors (7th to 10th floors; accounts for about 30% of the total rental space).
3328
4842
31
48
26
45
12
1
34
03 5
0
10
20
30
40
50
FP23Aug. 2013
FP24Feb. 2014
FP25Aug. 2014
FP26Feb. 2015
FP27Aug. 2015
FP28Feb. 2016
FP29Aug. 2016
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
Other Sponsor(bil. yen)
Note: “ORIX Group’s real estate segment assets” is prepared independently by OAM based on “Consolidated Financial Results Supplementary Information for the Three-month Ended Mar. 31, 2020” (based on book value as of June 30, 2019) released by ORIX Corporation. As of October 17, 2019, the date of financial announcement, OJR has no plan to purchase the above-mentioned properties.
Rental real estate: 329 billion yen Operating Assets (including hotels and inns): 177 billion yen
Driving external growth by utilizing ORIX Synergy
17
Office
ORIX Yaesu-Dori Building
(Chuo-ku, Tokyo)
Office
Hotel
Naha Shin-ToshinCenter Building
(Okinawa)
Retail Facility
Felicita Shinsaibashi
(Osaka)
Residential property
HUNDRED CIRCUS East Tower
(Shinjuku-ku, Tokyo)
Hotel, Serviced apartmentLogistics facility
MatsubushiLogistics Center
(Saitama)
Hilton Okinawa Chatan Resort
(Okinawa)
Hotel
Sponsor Pipeline and Acquisition Track Record from Sponsor
OJR’s Track Record in Property Acquisition from ORI X Group (Note)
Property acquisition totaled 361 billion yen during and after FP23 (Aug. 2013), of which approx. 90% w ere acquired from Sponsor.
Note : The figure for FP23 (Aug. 2013) includes “intervillage OH! MAGARI (Silent Partnership Equity Interest)”. The figure for FP27 (Aug. 2015) includes “ARK Hills South Tower (Preferred Equity Securities)”.The figure for FP36 (Feb. 2020) indicates the figure up to the date of financial announcement on October 17, 2019.
ORIX Group’s Real Estate Segment Assets (Note)
Internal Growth Strategy
Occupancy Rates at the End of each Fiscal Period
17,10011,200
21,700
12,6004,900
13,9007,700
-16,400
-6,000
-18,300 -12,300
-5,300
-13,400 -9,000
12,000
-12,000
-30,000
-20,000
-10,000
0
10,000
20,000
30,000(㎡)
(%)
19Offices -Occupancy Rates and Tenant Turnover-
Achieved rent increase upon tenant turnover for 8 c onsecutive fiscal periods
Include approx. 6,500m2 move-out and move-in by a large tenant at “Shiba 2-chome Daiko Building”
Total acquisitionprice
Share of totalportfolio
Properties Occupancy rate NOI yieldYield after
depreciationAverage
building age
359.9 bil. yen 53.8% 54 99.1% 5.1% 4.3% 18.8 years
Officesas of financial announcement
Assumed move-in Assumed move-outMove-in (only confirmed move-in in and after FP36) Move-out (only confirmed move-out in and after FP36)
Move-in / Move-out Floor Space (above) and Rent Fluctuation Rate by Tenant Turnover (below)
99.2
99.1 98.8 98.8
96
97
98
99
100
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
(Assumption)
FP37Aug. 2020
(Assumption)
Total Offices
7% 6%
19%22%
28%
12%
26%
10%
21%
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
(Assumption)
FP37Aug. 2020
(Assumption)
0%
10%
20%
30%
Rent fluctuationamount upon turnover
for 6 months39 mil. y en 21 mil. y en 119 mil. y en 75 mil. y en 36 mil. y en 58 mil. y en
Note 1 : Figures of move-in / move-out space are rounded to the nearest 100m2.Note 2 : Move-in spaces are forecasted based on confirmed contracts (both increase and decrease in rent renewals), as well as assumptions based on inquiries from tenants and leasing market conditions.
Move-out spaces are forecasted based on confirmed contracts, as well as assumptions based on negotiation status with tenants and leasing market conditions.Note 3: “Rent fluctuation amount upon turnover for 6 months” indicates the difference between the monthly contract rent of new tenants and that of previous tenants over the 6 months. It does not reflect vacant periods or rent-free contracts, and thus is not an amount of contribution to performance in each fiscal period.
Excluding the rent fluctuation at “Shiba 2-chome DaikoBuilding” replaced at same rent level
18,700 20,900 22,80014,200
25,600
51,300
24,800
12,700
700100
2,100
0
1,400
700
700
0
44,600
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
(Assumption)
FP37Aug. 2020
(Assumption)
Upward renewals (comfirmed) Upward renewals (assumption) Downward renewals (comfirmed) Downward renewals (assumption) Renewals at the same rent Renewals at the same rent (assumption)
(53%)
(1%)
(46%)
20Achieved rent increase upon rent renewals for 12 co nsecutive fiscal periods
Rent Renewal Floor Spaces
Rent Fluctuation Rate upon Rent Renewals
Offices -Rent Renewals-
Note 1 : Figures are rounded to the nearest 100m2.Note 2 : Upward rent renewal and downward rent renewal are forecasted in consideration of the confirmed contracts, as well as the rent gap from the market and negotiation status
Rent renewalspaces
62,200㎡ 75,700㎡ 73,900㎡ 72,500㎡ 64,500㎡ 96,600㎡
6% 5% 6%
10%
8%7%
9%
3%
0%
5%
10%
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
FP36Feb. 2020
(Assumption)
FP37Aug. 2020
(Assumption)Rent fluctuationamount upon
renewalfor 6 months
39 mil. y en 34 mil. y en 42 mil. y en 38 mil. y en 59 mil. y en 132 mil. y en
Note: “Rent fluctuation amount upon renewal for 6 months” indicates the difference between the monthly contract rent before and after rent renewals over the 6 months. It is not an amount of contribution to performance in each fiscal period.
Floor space with upward rent renewal is on an incre asing trend
Retail Facilities 21
(Note) “Regional” refers to areas other than the Greater Tokyo Area (Tokyo, Kanagawa, Saitama and Chiba pref.). “Non-urban-type retail facilities” refers to retail facilities other than urban-type retail facilities.“Urban-type retail facilities” refers to retail facilities located adjacent to the terminal stations in the Greater Tokyo Area and other major cities.
Total acquisitionprice
Share of totalportfolio
Properties Occupancy rate NOI yieldYield after
depreciationAverage
building age
108.9 bil. yen 16.3% 28 99.7% 5.6% 4.8% 11.8 years
Retail Facilitiesas of financial announcement
Urban-typeretail facilities
(Greater Tokyo Area )42%
Suburban-type retail facilities
(Greater Tokyo Area )20%
Urban-type retail facilities(Regional)
13%
Suburban-type retail facilities(Regional)
25%
Implementing to dispose regional suburban-type reta il facilities. OJR does not own any GMS.
Morioka Minami Shopping Center Sansa
CROSS GARDEN KAWASAKI
Cross Avenue Harajuku
aune Yurakucho
aune Tenjin
Valor SuzukaShopping Center
Remaining contract terms for urban-type retail faci lity are diversified.Suburban-type retail facilities are stable with lon g term contracts.
Diversification of Remaining Contract Termsbased on actual rent as of the financial announcement on Oct. 17, 2019
Breakdown of Retail Facility Rentsas of the financial announcement on Oct. 17, 2019
Within 1 year1%
Within 1-3 years20%
Within 3-5 years
4%More than 5 years
76%
Suburban-type retail facilities
Within 1 year14%
Within 1-3 years29%
Within 3-5 years30%
More than 5 years
26%
Urban-type retail facilities
Change in Rent upon Turnover based on rooms (left axis) and Rent Fluctuation Rate (right axis)
Achieved steady rent increases upon turnover
22
Renewed contract with a major tenant at Sakai Logis tics Center North Building and continue to be stabl y managed
Residential Properties and Logistics Facilities
Total acquisitionprice
Share of totalportfolio
Properties Occupancy rate NOI yieldYield after
depreciationAverage
building age
68.2 bil. yen 10.2% 14 95.9% 5.7% 4.5% 12.4 years
Residential Propertiesas of financial announcement
Total acquisitionprice
Share of totalportfolio
Properties Occupancy rate NOI yieldYield after
depreciationAverage
building age
37.1 bil. yen 5.5% 5 100% 5.7% 4.3% 10.9 years
Logistics Facilitiesas of financial announcement
Within 3 min.
53%5 properties
Within 3-5 min.
17%3 properties
Within 5-10 min.
24%4 properties
More than 10 min.
6%2 properties
West Park Tower
IKEBUKURO
Central Crib Roppongi
R-Styles Musashi-Kosugi
Belle Face Osaka
Shinmachi
Belle Face Meguro
Belle Face Kanazawa Kohrinbo
Minutes Walk to Nearest Stationbased on acquisition price
Within 10 min.
94%
Highly convenient locations primarily in central To kyo
Shibaura Island Air
Tower
Belle Face Mishuku
(Reference)Rent fluctuation rate upon renewal during FP35 +1.0%
5.3%
0%
2%
4%
6%
8%
10%
0%
20%
40%
60%
80%
100%
FP30(Feb. 2017)
FP31(Aug. 2017)
FP32(Feb. 2018)
FP33(Aug. 2018)
FP34(Feb. 2019)
FP35(Aug. 2019)
Upward Downward Same rent Rent fluctuation rate
23Hotels and Others
� Renovated 55 guest rooms on the upper 2 floors in March 2019 to maintain competitiveness on the face of difficult operating environment due to increased competition in the area.
� Increased ADR and occupancy by above 10% and RevPAR by approx. 30% yoy for 5 months post renovation at renovated floors .
Hotel Nikko Himeji
Ref: OJR’s rental income: Fixed rent of 525milion yen per period + Variable rent
<Variable rent calculation period>i. Calculated based on the hotel sales for the period from October of the preceding year to March
of the current year.ii. Calculated based on the hotel sales for the period from April to September of the current year.
Hotel Universal Port (HUP): Performed slightly unde r expectations
Total acquisitionprice
Share of totalportfolio
Properties Occupancy rate NOI yieldYield after
depreciationAverage
building age
94.4 bil. yen 14.1% 10 99.8% 5.3% 4.1% 20.7 years
Hotels and Othersas of financial announcement
Note: Hotel type chart excludes “TAKANAWA DUPLEX C’s” and “GOOD TIME LIVING Shin-urayasu”.Both charts are based on acquisition price as of the end of Aug. 2019.
Business hotels27%
Theme park official hotels67%
Full-service hotels 5 %
Within 5-10 min.
5%
Within 3-5 min.
17%
Within 3 min.78%
Minutes Walk to Nearest Station(Business hotels and full-service hotels)
Hotel Universal Port
Cross Gate
HOTEL LiVEMAXNAGOYA SAKAE-EAST
Richmond Hotel Yamagata Ekimae
Tokyo Bay Maihama Hotel First Resort
Almost 70% are theme park official hotels where sta ble demand is expected.95% of our business and full-service hotels are con veniently located within 5 minutes walk from stations.
Enhancement for the future
Hotel Universal Port
Girly Room
Hotel type
(million yen)
Oct. 1, 2018 to Mar. 31, 2019(Actual)
Initial estimated range
Hotel sales 2,827 2,941 to 3,276
↓ ↓
FP35 (Aug. 2019) Initial estimated range
Rent 997 1,020 to 1,087
� Renovated 52 rooms on the upper floor in March 2019.
� Increased ADR and occupancy yoyfor 5 months post renovation at these rooms.
� Particularly increased ADR by approx. 20%, occupancy by nearly 10% and RevPAR by approx. 30% at 10 rooms renovated to attract young women (“girly room”).
� Plans to renovate additional 52 rooms prior to the new opening of “SUPER NINTENDO WORLD™ “at USJ by 2020.
Financial Strategy
Refinancing results of 11,000 mil. yen
since FP35 to financial announcement on Oct. 17, 20 19 (Note) Pre-refinance Post-refinance
Average debt maturity 5.6 years 8.4 years
Average interest rate 1.31% 0.33%
0
10,000
20,000
30,000
40,000
50,000
FP35Aug.2019
FP36Feb.2020
FP37Aug.2020
FP38Feb.2021
FP39Aug.2021
FP40Feb.2022
FP41Aug.2022
FP42Feb.2023
FP43Aug.2023
FP44Feb.2024
FP45Aug.2024
FP46Feb.2025
FP47Aug.2025
FP48Feb.2026
FP49Aug.2026
FP50Feb.2027
FP51Aug.2027
FP52Feb.2028
FP53Aug.2028
FP54Feb.2029
FP55Aug.2029
FP56Feb.2030
Existing interest-bearing liabilities Refinancing
274,117Average duration to maturity︓3.9 yearInterest-bearing liabilities︓295,037 million yen
Interest-bearing liabilities due for repayment up to Oct. 17, 2019
Commitment line: 40.5 billion yen
Early repayment of short-term debts in FP35 (Aug.2019) through issuance of green bonds
Lowered interest rate while maintaining financial s tability
Financial Strategy I
Financing Costs and Average Duration to Maturity
Maturity and Duration of Interest-Bearing Liabiliti es as of financial announcement on Oct. 17, 2019
3.1
3.4
3.63.7 3.7
4.44.2
4.4
3.8
4.2 4.3 4.2 4.13.9 3.9
1.85
1.601.52 1.47
1.38 1.311.20
1.09 1.03 1.01 0.99 0.96 0.94 0.88
1.48 1.30
1.24 1.19 1.13 1.03 0.98
0.87 0.80 0.84 0.81 0.80 0.78 0.71 0.5
1.0
1.5
2.0
2.0
2.5
3.0
3.5
4.0
4.5
5.0
FP22Feb. 2013
FP23Aug. 2013
FP24Feb. 2014
FP25Aug. 2014
FP26Feb. 2015
FP27Aug. 2015
FP28Feb. 2016
FP29Aug. 2016
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
As of financialannouncement on
Oct. 17, 2019
Average duration to maturity (left axis) Average funding cost (right axis) Average interest rate (right axis)(year) (%)
Note: Includes fixed rate refinancing only.
(million yen)
25
0.96 0.67 0.87 0.49 0.82 0.84 0.73 0.53 0.80 0.52 0.79 0.65 0.62 0.55 0.61 0.75 0.63 0.58 0.81 0.50 0.37Average interest rates
(%)
Financial Strategy II
Trends on LTV based on Total Assets and Borrowing C apacity (up to LTV of 50%)
Financial Indicators as of financial announcement on Oct. 17, 2019Credit Ratings
Maintaining low LTV level and borrowing capacity to enable swift property acquisition
90,380
50.3
48.3 48.9
46.7 47.1 46.0 45.9 45.5 46.3
43.6 43.7
42.8 42.7 43.1 43.4
0
25,000
50,000
75,000
100,000
125,000
42
44
46
48
50
52
FP22Feb. 2013
FP23Aug. 2013
FP24Feb. 2014
FP25Aug. 2014
FP26Feb. 2015
FP27Aug. 2015
FP28Feb. 2016
FP29Aug. 2016
FP30Feb. 2017
FP31Aug. 2017
FP32Feb. 2018
FP33Aug. 2018
FP34Feb. 2019
FP35Aug. 2019
As of financialannouncement
Borrowing capacity (up to LTV of 50%)(right axis) LTV based on total assets (left axis)(%) (million yen)
26
Interest-bearing liabilities 291,917 million yen 295,037 million yen
LTVbased on total assets
43.1 % 43.4 %
LTVbased on unitholders’ capital
46.5 % 46.8 %
Average interest rate 0.71 % 0.70 %
Average funding cost 0.88 % -
Fixed-rate debt ratio 90.2 % 88.9 %
Average duration to maturity 3.9 years 3.9 years
End of FP 35Aug. 31, 2019
As of financialannouncement on
Oct. 17, 2019R&I Issuer rating : AA - (Stable)
JCR Long-term issuer rating : AA (Stable)
Financial institution Balance(million yen)
Sumitomo Mitsui Trust Bank, Limited 50,395 18.3 %
MUFG Bank, Ltd. 48,555 17.6 %
Sumitomo Mitsui Banking Corporation 32,788 11.9 %
Mizuho Bank, Ltd. 27,699 10.1 %
Development Bank of Japan Inc. 22,440 8.1 %
The Norinchukin Bank 13,850 5.0 %
Shinsei Bank, Limited 12,760 4.6 %
Resona Bank, Limited 11,860 4.3 %
Mizuho Trust & Banking Co., Ltd. 10,840 3.9 %
The Bank of Fukuoka, Ltd. 7,400 2.7 %
Aozora Bank, Ltd. 4,550 1.7 %
THE NISHI-NIPPON CITY BANK, LTD. 3,800 1.4 %
THE SHIZUOKA BANK, LTD. 3,000 1.1 %
The 77 Bank, Ltd. 3,000 1.1 %
National Mutual Insurance Federation of Agricultural Cooperatives 3,000 1.1 %
The Daishi Bank, Ltd. 3,000 1.1 %
The Shinkumi Federation Bank 2,500 0.9 %
The Yamaguchi Bank, Ltd. 2,000 0.7 %
SUMITOMO LIFE INSURANCE COMPANY 1,500 0.5 %
Mitsui Sumitomo Insurance Company, Limited 1,500 0.5 %
ORIX Bank Corporation 1,000 0.4 %
The Kagawa Bank, Ltd. 1,000 0.4 %
Taiyo Life Insurance Company 1,000 0.4 %
THE CHUGOKU BANK, LTD. 1,000 0.4 %
Tokio Marine & Nichido Fire Insurance Co., Ltd. 1,000 0.4 %
The Hyakugo Bank, Ltd. 1,000 0.4 %
THE HIROSHIMA BANK, LTD. 1,000 0.4 %
The Minato Bank, Ltd. 800 0.3 %
Kiraboshi Bank, Ltd. 500 0.2 %
Meiji Yasuda Life Insurance Company 500 0.2 %
THE SHIMANE BANK, LTD. 300 0.1 %
Ratio
Debt Lenders: 31 institutions / 275,537 million yen in total
Investment Corporation BondsTotal: 19,500 million yen
(注)
Financial Strategy IIICommitment Lines
All data are as of financial announcement on Oct. 17, 2019
27
Balance(million yen)
Interestrate
Issue date Period
The 7th unsecured bonds 2,500 1.200% Jan. 20, 2014 10 yrs.
The 9th unsecured bonds 3,000 0.901% Aug. 11, 2014 10 yrs.
The 10th unsecured bonds 2,000 0.886% Dec. 19, 2014 10 yrs.
The 11th unsecured bonds 2,000 0.200% Jul. 18, 2018 4.5 yrs.
The 12th unsecured bonds 3,000 0.550% Jul. 18, 2018 10 yrs.
The 13th unsecured bonds7,000 0.220% Jul. 18, 2019 5 yrs.
Financial institution Maturity dateLine limit
(million yen)
Mizuho Bank, Ltd. Oct. 2, 2022 10,000
Aozora Bank, Ltd. Dec. 29, 2020 7,500
Sumitomo Mitsui Trust Bank, Limited Jul. 29, 2022 6,000
MUFG Bank, Ltd. Jul. 31, 2021 6,000
Sumitomo Mitsui Banking Corporation Feb. 24, 2021 5,000
MUFG Bank, Ltd. Aug. 27, 2022 4,000
Resona Bank, Limited Jul. 31, 2022 2,000
Total 40,500
Drawdown amount 0
Available commitment line 40,500
NEW
“1st OJR Green Bonds” NEW
Initiatives towards ESG
Green bond
Proactive communication with stakeholders
Issued our first green bonds as a part of our ESG initiatives. Enhanced our financial stability through broadening our investor universe, particularly those who are ESG investors.
Initiatives for environment Initiatives for society Initiatives for governance
ESG report
Issued ESG report with the objective of reporting to unitholders and all other stakeholders regarding OJR/OAM’s approach to ESG.
Initiatives towards ESG I -Examples-
OJR Board
Compliance system in asset management company
A solid compliance system is in place to prevent conflict of interest, risk management and legal compliance when the asset management company buys or sells properties.
MembersExecutive Director : 1
Supervisory Director : 3
• Executive Director ︓A person with no conflicted interest in OJR or ORIX Asset Management Corporation is chosen for this position.
• Supervisory Director ︓ Three supervisory directors in order to ensure a high level of independence (attorney, certified accountant, real estate appraiser).
Risk Management
and Compliance Committee
• Composed of the CEO, officer in charge of compliance and external committee member qualified as attorney
• Attendance and approvalfrom external committeemember is required
InvestmentCommittee
• Composed of senior management and external committee member qualified as real estate appraiser
• Attendance and approvalfrom external committee member is required
29
Financial results briefing
2
Investor meetings276 including104 overseas
Events for individual investors
Total 15
Financial results briefings for individual unitholders
Total 4
Property tours for institutional investors
3
Track records for last 12 months as of Oct. 17, 2019
Issue amount 7 billion yen
Issue date July 18, 2019
Maturity date July 18, 2024
Interest rate 0.220% per annum
Investors who declared intention to invest as of July 11, 2019 (in alphabetical order)
- Daitokyo Shinyokumiai- Fujinomiya Shinkin Bank- Hanno-Shinkin Bank- IZAWA METAL Co., Ltd.- NAKATANI KOUN CO., LTD.
- Sumitomo Mitsui Trust Asset Management Co., Ltd.
- THE OITA BANK, LTD.- THE SUGAMO SHINKIN BANK
- The 77 Bank, Ltd.
GRESB Public Disclosure:"A"
Evaluation Property name
★★★★ 【Office】 ARK Hills South Tower
★★★ 【Residential】 West Park Tower IKEBUKURO
Evaluation Property name
★★★★★ 【Office】 Lunar Sendai
★★★★
【Logistics】 Toda Logistics Center
【Logistics】 Iwatsuki Logistics Center
【Logistics】 Sakai Logistics Center North Building
【Logistics】 Komaki Logistics Center
★★★
【Office】 Shiba 2-chome Daiko Building
【Office】 ORIX Real Estate Nishi Shinjuku Building
【Office】 ORIX Nagoya Nishiki Building
【Office】 ORE Nishiki 2-chome Bldg.
★★ 【Hotels and others】 Hotel Universal Port
Evaluation Property name
★★★★★
【Office】 Seafort Square Center Building
【Office】 ORIX Akasaka 2-chome Building
【Office】 Round-Cross Kawasaki
【Office】 Hamamatsu Act Tower (Office and retail areas)
【Retail】 aune Kohoku
【Retail】 aune Makuhari
【Retail】 CROSS GARDEN KAWASAKI
【Retail】 Inter Village OH! MAGARI
【Hotels and others】 Cross Gate(Retail area)
★★★★
【Office】 MG Shirokanedai Building
【Office】 ORIX Meguro Building
【Office】 ORE Omiya Building
【Office】 Nagoya Itochu Building
【Office】 DOJIMA PLAZA BLDG.
【Office】 PRIME SQUARE HIROSE-DORI
【Logistics】 Ichikawa Logistics Center
Promoting acquisition of certifications. The Total of GFA coverage ratio is 60%.
"Green Star"
CASBEE® Certification for Buildings
BELS
DBJ Green Building Certification
Earned the highest "Green Star" in the GRESB Real E state Assessment during past 5 years and the highes t "A" in the GRESB Public Disclosure.
Initiatives towards ESG II -Certifications-
Note: GFA coverage ratio is calculated based on the registered GFA excluding land rights. In the case where the certification was acquired for a specific section of a multi usage facility, we use the entire floor space of this property for the purpose of calculating the coverage ratio.
“4 Star"
GRESB Real Estate Assessment:
GRESB Rating:
30Included in MSCI Japan ESG Select Leaders Index fro m Dec. 2018
Government Pension Investment Fund (GPIF)’s ESG indices for their passive investment.
Appendix
2,200
2,400
2,600
2,800
3,000
3,200
3,400
3,600
3,800
0
100
200
300
400
500
600
700
Driving Growth of Unitholder ValueImproved DPU and liquidity of investment units whil e considering NAV per unit
Stable Growth of DPU Increase of NAV per unit
Enhanced Liquidity of Investment Units
100,000
110,000
120,000
130,000
140,000
150,000
160,000
170,000
180,000
190,000
0
500
1,000
926 yen
180,570 yen3,755 yen
(bil. yen)
(yen)
(yen)(yen)
■DPU ■NAV per unit including internal reserves
(Note)2,352 yen
As of Sep. 30, 2019
651.3 bil. yen
■Market Cap■Internal Reserves per unit
Note: As of the record date on Feb. 28, 2013 and effective Mar. 1, 2013, OJR conducted a one into fifth investment unit split. The above-mentioned DPU, NAV per unit and internal reserves per unit for FP 22 (Feb. 2013) = Actual Distributions, NAV or internal reserve for FP 22 (Feb. 2013) / (5*investment units outstanding at the end of Feb. 2013 (FP 22)). The calculation result is rounded down to the nearest whole number.
47 yen(Note)
104,670 yen
(Note)
Intension is to utilize internal reserves to deal with temporary factors with due consideration of DPU and to contribute to the sustainable growth of unitholder value
32
FP22(Feb. 2013)
FP35(Aug. 2019)
FP22(Feb. 2013)
FP22(Feb. 2013)
Feb. 2013 Sep. 2019
As of financial announcement on
Oct. 17, 2019
As of financial announcement on
Oct. 17, 2019
Target sustainable growth of unitholder value by st rengthening our portfolio, enhancing financial stab ility and diversifying ourgrowth opportunities
Implementation of various strategies supported by o ur 3 strengths; “Diversified REIT ,” “ORIX Synergy” and “Operating Expertise”
Asset
Internal Growth Strategy
Equity
Debt
Financial StrategyExternal Growth Strategy
Swiftproperty
acquisition
Internal reserves by utilizing capital gain
Our Growth Strategy
Strengthen profitability, stability and growth thro ugh operating expertise
Secure acquisition capacity
Operation by utilizing direct property management
Careful selection in properties that can leverage our strengths Various growth drivers
Property acquisition by utilizing various funding sources
Reduce finance costsEnhance financial stability
including improvement in ratings
Property replacement responding to market
environment
Operating ExpertiseORIX Synergy
Stable revenue growth
Risk diversification
Expand investment
opportunities
Nationwide network
Professional expertise
Pipeline support
Direct property management
Fund management expertise (Note)
Effectively use free cash flow for property acquisition and strategic
CAPEX
Sustainable growth of DPU Enhancement of NAV per unit
Enhancement of liquidity
Note : ”Fund management expertise” indicates our expertise in targeting sustainable growth of unitholder value by leveraging our external growth, internal growth and financial strategies.
Diversified REIT
33
Five Period Performance Summary(million yen)
Operating revenues 22,484 22,987 23,754 24,052 24,357
Operating income 10,192 10,610 11,124 10,578 11,731
Ordinary income 8,672 9,131 9,643 9,178 10,378
Net income 8,657 9,116 9,629 9,164 10,174
Unitholders' capital 323,282 323,282 335,757 335,757 335,757
Net assets 334,685 335,145 348,408 347,942 348,493
Total assets 657,898 659,716 673,068 673,908 677,334
Number of investment units outstanding (unit) 2,680, 000 2,680,000 2,760,000 2,760,000 2,760,000
Net assets per unit (yen) 124,883 125,054 126,235 126,066 126,266
Distribution per unit (yen) 3,230 3,299 3,489 3,487 3,755
NAV per unit (yen) (Note1) 161,186 164,272 169,886 174,844 179,859
NAV per unit (yen)
including internal reserves (Note2) 162,210 165,399 170,980 175,771 180,718
Acquisition price 634,841 634,947 668,947 663,532 667,432
Number of properties 110 110 111 109 110
NOI yield 5.1 % 5.1 % 5.1 % 5.1 % 5.3 %Yield after depreciation 4.1 % 4.1 % 4.2 % 4.2 % 4.4 %Unrealized gain/loss 108,697 116,968 133,128 146,812 160,654
Funds from operation 12,747 12,885 13,788 13,814 14,337
Depreciation expenses 4,015 3,970 4,084 4,112 4,086
Cost of finance lease of property 74 74 74 76 76
CAPEX 1,615 1,134 929 929 1,894
Free cash flow 2,474 2,910 3,229 3,259 2,267
FP31(Aug. 2017)
FP32(Feb. 2018)
FP33(Aug. 2018)
FP34(Feb. 2019)
FP35(Aug. 2019)
FP31(Aug. 2017)
FP32(Feb. 2018)
FP33(Aug. 2018)
FP34(Feb. 2019)
FP35(Aug. 2019)
Note1:“NAV per unit” refers to the amount calculated by the following formula at any given point in time. (The sum of unitholders’ capital + unrealized gain/loss) / the number of investment units outstanding
Note2:“NAV per unit including internal reserves” refers to the amount calculated by the following formula at any given point in time. (The sum of unitholders’ capital + unrealized gain/loss + internal reserves) / the number of investment units outstanding
34
Performance Forecast Comparison I
Note: “Financing-related costs” is the sum of interest expenses, interest on investment corporation bonds, depreciation of investment corporation bonds issuance costs and funding related expenses.
35(million yen)
iActual result
for FP35(Aug. 2019)
iiForecast at previous
financial announcement for FP35
(Aug. 2019)
i - iiChange
iiiForecast for FP36
(Feb. 2020)
ivForecast at previous
financial announcement for FP36
(Feb. 2020)
iii - ivChange
Rental revenues 21,750 21,606 +144 21,890 21,696 +194
Other operating revenues 2,606 2,692 -86 2,461 2,397 +63
Gains on disposition of real estate proterties - - - 469 - +469
Total operating revenue 24,357 24,298 +58 24,820 24,094 +726
Property management fees 2,083 2,026 +57 2,069 1,983 +86
Utility charges 1,761 2,063 -302 1,805 1,881 -76
Property-related taxes 1,854 1,862 -8 1,842 1,862 -20
Repair cost 630 691 -60 774 711 +63
Depreciation expenses 4,086 4,066 +19 4,057 4,036 +21
Others 451 526 -75 521 674 -152
Property-related expense 10,866 11,236 -369 11,070 11,149 -78
Net property income 13,490 13,062 +428 13,750 12,944 +805
Asset management fee 1,502 1,488 +13 1,523 1,498 +24
Administrative service fee 88 90 -2 99 101 -1
Other expense 168 216 -47 250 202 +48
Expenses other than property-related expense 1,759 1,794 -35 1,873 1,802 +70
Total operating expense 12,625 13,031 -405 12,944 12,951 -7
Operating income 11,731 11,267 +463 11,876 11,142 +734
Non-operating income 4 3 +0 3 3 -
Financing-related costs (Note) 1,352 1,367 -14 1,284 1,351 -66
Issuance costs of new units - - - - - -
Other expense 4 7 -2 6 7 -1
Non-operating expense 1,357 1,374 -16 1,291 1,358 -67
Ordinary income 10,378 9,897 +481 10,588 9,786 +801
Extraordinary income or loss -189 -337 +148 -148 - -148
Income before income taxes 10,189 9,560 +629 10,440 9,786 +653
Provision for income taxes 14 17 -2 17 17 -
Net income 10,174 9,543 +631 10,423 9,769 +653
Reserving internal reserves - - - 185 - +185
Allocation of internal reserve 189 337 -148 - - -
Distributable profit 10,365 9,881 +483 10,240 9,770 +469
Number of investment units outstanding (unit) 2,760,000 2,760,000 - 2,760,000 2,760,000 -
DPU (yen) 3,755 3,580 +175 3,710 3,540 +170
CAPEX 1,894 1,958 -63 1,374 1,664 -290
Allocated internal reserves to offset earthquake restoration expense at “intervillage OH! MAGARI”
Allocate gain from disposition to offset earthquake restoration expense at “intervillage OH! MAGARI”
Performance Forecast Comparison II 36
Note1: “Existing operation” refers to the operation in properties owned as of the end of the FP34 (Feb. 2019).Note2: “Total income or loss other than net property income excluding extraordinary income or loss” is the sum of expenses other than property-related expenses, non-operating profit and loss, and provision for income taxes.Note3: “Total income or loss other than net property income” is the sum of expenses other than property-related expenses, non-operating profit and loss, extraordinary income or loss and provision for income taxes.
Reference: Breakdown of previous page
1. Existing operation (Note1) (million yen)
iActual result
for FP35(Aug. 2019)
iiForecast at previous
financial announcement for FP35
(Aug. 2019)
i - iiChange
iiiForecast for FP36
(Feb. 2020)
ivForecast at previous
financial announcement for FP36
(Feb. 2020)
iii - ivChange
Rental revenues 21,732 21,606 +125 21,806 21,696 +109
Other operating revenues 2,603 2,692 -88 2,418 2,397 +20
Gains on disposition of real estate proterties - - - - - -
Total operating revenue 24,335 24,298 +36 24,224 24,094 +130
Property-related expense 10,856 11,236 -380 11,016 11,149 -132
Property-related taxes 1,854 1,862 -8 1,854 1,862 -8
Depreciation expenses 4,081 4,066 +14 4,046 4,036 +9
Net property income 13,479 13,062 +416 13,208 12,944 +263
Extraordinary income or loss -189 -337 +148 -148 - -148
-3,126 -3,182 +56 -3,144 -3,175 +31
Net income 10,164 9,543 +621 9,916 9,769 +146
Allocation of internal reserve 189 337 -148 - - -
Distributable profit 10,354 9,881 +473 9,918 9,770 +147
Number of investment units outstanding (unit) 2,760,000 2,760,000 - 2,760,000 2,760,000 -
DPU (yen) 3,751 3,580 +171 3,593 3,540 +53
Total income or loss other than net property income excluding
extraordinary income or loss (Note2)
Increase in rental revenues as a result of improvem ent in rental conditions and decrease in move-out floor sp ace
Decrease in utility charges △305(Change of electricity providers and decrease in fue l cost adjustment )
Decrease in utility charges △111(Review of cost to reflect decrease in fuel cost adj ustment )
2. The impact from 3 properties acqusition and 2 pro perties disposition (million yen)
iActual result
for FP35(Aug. 2019)
iiForecast at previous
financial announcement for FP35
(Aug. 2019)
i - iiChange
iiiForecast for FP36
(Feb. 2020)
ivForecast at previous
financial announcement for FP36
(Feb. 2020)
iii - ivChange
Rental revenues 18 - +18 84 - +84
Other operating revenues 2 - +2 42 - +42
Gains on disposition of real estate proterties - - - 469 - +469
Total operating revenue 21 - +21 596 - +596
Property-related expense 10 - +10 54 - +54
Property-related taxes 0 - +0 -11 - -11
Depreciation expenses 4 - +4 11 - +11
Net property income 11 - +11 542 - +542
Total income or loss other than net property income (Note3) -0 - -0 -34 - -34
Net income 10 - +10 507 - +507
Reserving internal reserves - - - 185 - +185
Distributable profit 10 - +10 322 - +322
Number of investment units outstanding (unit) - - - - - -
DPU (yen) 4 - +4 117 - +117
Gain from disposition of "Okayama Kume Retail Facil ity" +415Gain from disposition of "KN Jiyugaoka Plaza(49%) " +5 3
Period-over-Period Performance Comparison I 37(million yen)
iActual result
for FP34(Feb. 2019)
ii - iChange
ⅱActual result
for FP35(Aug. 2019)
iii - iiChange
iiiForecast for FP36
(Feb. 2020)
iv - iiiChange
ivForecast for FP37
(Aug. 2020)
Rental revenues 21,594 +156 21,750 +139 21,890 +27 21,917
Other operating revenues 2,457 +149 2,606 -145 2,461 +55 2,516
Gains on disposition of real estate proterties - - - +469 469 -410 58
Total operating revenue 24,052 +305 24,357 +463 24,820 -328 24,492
Property management fees 2,130 -47 2,083 -13 2,069 +4 2,074
Utility charges 1,760 +1 1,761 +43 1,805 +27 1,832
Property-related taxes 1,803 +50 1,854 -12 1,842 +38 1,880
Repair cost 910 -280 630 +144 774 -6 767
Depreciation expenses 4,112 -26 4,086 -28 4,057 -31 4,025
Others 436 +14 451 +70 521 +61 583
Property-related expense 11,154 -288 10,866 +204 11,070 +93 11,164
Loss from property disposition 460 -460 - - - - -
Net property income 12,436 +1,054 13,490 +259 13,750 -421 13,328
Asset management fee 1,502 +0 1,502 +21 1,523 -2 1,520
Administrative service fee 170 -81 88 +11 99 -9 90
Other expense 185 -16 168 +81 250 -42 208
Expenses other than property-related expense 1,857 -98 1,759 +114 1,873 -54 1,818
Total operating expense 13,473 -847 12,625 +318 12,944 +38 12,983
Operating income 10,578 +1,152 11,731 +145 11,876 -367 11,509
Non-operating income 7 -3 4 -0 3 - 3
Financing-related costs (Note) 1,401 -48 1,352 -67 1,284 +7 1,292
Issuance costs of new units - - - - - - -
Other expense 6 -1 4 +1 6 +1 7
Non-operating expense 1,407 -49 1,357 -66 1,291 +8 1,299
Ordinary income 9,178 +1,199 10,378 +210 10,588 -375 10,213
Extraordinary income or loss - -189 -189 +41 -148 +148 -
Income before income taxes 9,178 +1,010 10,189 +251 10,440 -227 10,213
Provision for income taxes 14 -0 14 +2 17 - 17
Net income 9,164 +1,010 10,174 +248 10,423 -227 10,196
Reserving internal reserves - - - +185 185 -63 122
Allocation of internal reserve 460 -271 189 -189 - - -
Distributable profit 9,625 +739 10,365 -125 10,240 -165 10,074
Number of investment units outstanding (unit) 2,760,000 - 2,760,000 - 2,760,000 - 2,760,000
DPU (yen) 3,487 +268 3,755 -45 3,710 -60 3,650
CAPEX 929 +964 1,894 -520 1,374 +170 1,545
Allocated internal reserves to offet earthquake restoration expense at “intervillage OH! MAGARI”
Guest room renovation at "Hotel Universal Port", "To kyo Bay Maihama Hotel First Resort" and "Hotel Nikko Hi meji"
Allocate gain from disposition to offset earthquake restoration expense at “intervillage OH! MAGARI”
Note: “Financing-related costs” is the sum of interest expenses, interest on investment corporation bonds, depreciation of investment corporation bonds issuance costs and funding related expenses.
Period-over-Period Performance Comparison II 38
Reference: Breakdown of previous page
1. Existing operation (Note1)
iActual result
for FP34(Feb. 2019)
ii - iChange
ⅱActual result
for FP35(Aug. 2019)
iii - iiChange
iiiForecast for FP36
(Feb. 2020)
iv - iiiChange
ivForecast for FP37
(Aug. 2020)
Rental revenues 21,594 +137 21,732 +74 21,806 +7 21,813
Other operating revenues 2,457 +146 2,603 -185 2,418 +42 2,460
Gains on disposition of real estate proterties - - - - - - -
Total operating revenue 24,052 +283 24,335 -111 24,224 +49 24,273
Property-related expense 11,154 -298 10,856 +160 11,016 +67 11,084
Property-related taxes 1,803 +50 1,854 -0 1,854 +21 1,875
Depreciation expenses 4,112 -31 4,081 -35 4,046 -28 4,018
Loss from property disposition 460 -460 - - - - -
Net property income 12,436 +1,043 13,479 -271 13,208 -18 13,189
Extraordinary income or loss - -189 -189 +41 -148 +148 -
-3,271 +145 -3,126 -17 -3,144 +55 -3,088
Net income 9,164 +1,000 10,164 -248 9,916 +184 10,100
Allocation of internal reserve 460 -271 189 -189 - - -
Distributable profit 9,625 +729 10,354 -436 9,918 +184 10,102
Number of investment units outstanding (unit) 2,760,000 - 2,760,000 - 2,760,000 - 2,760,000
DPU (yen) 3,487 +264 3,751 -158 3,593 +67 3,660
Total income or loss other than net property income excluding
extraordinary income or loss (Note2)
Normalization of Hotel Universal Port's variable re nt +200Absence of rent for 3 properties disposed during FP3 4 △217Existing properties +154
Increase of property-related tax due to asset-evalu ation +29Property-related tax for "Hotel Universal Port" +45Decrease due to 3 properties disposition during FP34 △24
Decrease in repair cost △280
Absence of one-off income such as insurance income △128
Increase in repair cost +142
Increase in one-off income such as insurance income +93
Increase of property-related tax due to asset-evaluation +21
2. The impact from 3 properties acqusition and 2 pro perties dispositioni
Actual resultfor FP34
(Feb. 2019)
ii - iChange
ⅱActual result
for FP35(Aug. 2019)
iii - iiChange
iiiForecast for FP36
(Feb. 2020)
iv - iiiChange
ivForecast for FP37
(Aug. 2020)
Rental revenues - +18 18 +65 84 +20 104
Other operating revenues - +2 2 +39 42 +12 55
Gains on disposition of real estate proterties - - - +469 469 -410 58
Total operating revenue - +21 21 +574 596 -377 218
Property-related expense - +10 10 +44 54 +25 79
Property-related taxes - +0 0 -11 -11 +17 5
Depreciation expenses - +4 4 +6 11 -3 7
Net property income - +11 11 +530 542 -403 138
Total income or loss other than net property income (Note3) - -0 -0 -33 -34 -9 -43
Net income - +10 10 +497 507 -412 95
Reserving internal reserves - - - +185 185 -63 122
Distributable profit - +10 10 +312 322 -349 -26
Number of investment units outstanding (unit) - - - - - - -
DPU (yen) - +4 4 +113 117 -127 -10
Gain from disposition of "Okayama Kume Retaill Facil ity" +415Gain from disposition of "KN jiyugaoka Building (49%)" +53
Gain from disposition of "KN jiyugaoka Building (51%)"
Note1: “Existing operation” refers to the operation in properties owned as of the end of the FP34 (Feb. 2019).Note2: “Total income or loss other than net property income excluding extraordinary income or loss” is the sum of expenses other than property-related expenses, non-operating profit and loss, and provision for income taxes.Note3: “Total income or loss other than net property income” is the sum of expenses other than property-related expenses, non-operating profit and loss, extraordinary income or loss and provision for income taxes.
Portfolio Summary IAs of financial announcement on Oct. 17, 2019
39
Aoyama Suncrest Building Nov. 1979 10,076 1.5
Round-Cross Ichi-bancho Mar. 1994 3,526 0.5
Round-Cross Nishi Shinjuku Jun. 1999 2,650 0.4
DT Gaien Feb. 1990 2,430 0.4
Yoyogi Forest Building Jun. 1987 1,406 0.2
Round-Cross Akasaka Oct. 1978 2,624 0.4
Round-Cross Mita May 1990 1,748 0.3
Round-Cross Shiba Daimon Oct. 1988 2,195 0.3
Round-Cross Tsukiji May 1992 3,378 0.5
Shiba 2-chome Daiko Building Jan. 2003 7,500 1.1
Aoyama 246 Building Nov. 1990 5,200 0.8
Round-Cross Shinjuku Oct. 2005 8,020 1.2
Seafort Square Center Building Jun. 1992 18,000 2.7
ORIX Akasaka 2-chome Building Nov. 2004 21,860 3.3
Round-Cross Shinjuku 5-chome Oct. 2006 4,500 0.7
Nihonbashi Honcho 1-chome Building Mar. 2006 10,500 1.6
Round-Cross Shibuya Mar. 2007 3,500 0.5
ORIX Suidobashi Building Oct. 2005 3,000 0.4
ORIX Shinagawa Building Jun. 2006 15,200 2.3
ORIX Real Estate Nishi Shinjuku Building Apr. 2007 13,600 2.0
Round-Cross Tamachi Jan. 1986 6,730 1.0
MG Shirokanedai Building May 1998 8,500 1.3
SHIBUYA PINE Bldg. Oct. 1991 3,400 0.5
MG Ichigaya Building Jan. 2008 3,100 0.5
Round-Cross Ginza 2-chome Aug. 2007 5,200 0.8
ARK Hills South Tower Jul. 2013 22,000 3.3
Round-Cross Akihabara Feb. 2004 4,202 0.6
Gaien Nishi-dori Building Dec. 1991 9,000 1.3
Round-Cross Roppongi May 2009 12,400 1.9
TOKYU REIT Akasaka Hinokicho Building Aug. 1984 2,352 0.4
Type Area Property CompletionAcquisition
price(million yen)
Offices6 Central
Tokyo Wards
Ratio (%)
Carrot Tower Nov. 1996 5,479 0.8
Beside Kiba Aug. 1991 2,450 0.4
ORIX Ikebukuro Building Jul. 2002 9,577 1.4
KN Jiyugaoka Plaza Dec. 2001 1,586 0.2
ORIX Meguro Building Jan. 1996 6,350 0.9
Akihabara Business Center Oct. 2009 5,060 0.8
Neo City Mitaka Sep. 1993 2,200 0.3
Round-Cross Kawasaki Jan. 1993 4,130 0.6
Omiya Miyacho Building Sep. 2008 4,400 0.7
Omiya Shimocho 1-chome Building Aug. 2009 3,750 0.6
ORE Omiya Building Jul. 1987 7,030 1.1
Nagoya Itochu Building Feb. 1981 4,500 0.7
ORIX Koraibashi Building Jul. 2004 5,560 0.8
Lunar Sendai Feb. 1998 8,500 1.3
ORIX Nagoya Nishiki Building Jan. 2007 12,500 1.9
ORE Sapporo Building Nov. 2008 4,250 0.6
ORIX Kobe Sannomiya Building Sep. 2009 3,800 0.6
ORE Nishiki 2-chome Bldg. Aug. 2012 10,900 1.6
DOJIMA PLAZA BLDG. Feb. 2010 9,500 1.4
PRIME SQUARE HIROSE-DORI May 2009 7,280 1.1
Hamamatsu Act Tower Aug. 1994 11,800 1.8
ORIX Yodoyabashi Bldg. Mar. 1991 5,012 0.7
SAPPORO BRICK CUBE May 1981 5,200 0.8
Round-Cross Kagoshima Nov. 2007 1,300 0.2
359,912 53.8
Type
RemainingTokyo Wards
Other Parts ofthe Greater Tokyo
Area
Other Areas
Area Property CompletionAcquisition
price(million yen)
Ratio (%)
Total of Offices
Note1:“Ratio” refers to the percentage in acquisition price of each property under management to the total acquisition price.Note2:Figures are rounded to the first decimal place for the “Ratio.” Totals for the “Ratio” may not tally due to this rounding.Note3:OJR changed its property name from “ORIX Shiba 2-chome Building” to “Shiba 2-chome Daiko Building” on Oct. 1, 2019.Note4:OJR acquired a 49% co-ownership interest in the TOKYU REIT Akasaka Hinokicho Building on October 1, 2019, and plans to
acquire the remaining 51% co-ownership interest on March 4, 2020. Note5:OJR disposed a 49% co-ownership interest in KN Jiyugaoka Plaza on October 1, 2019, and plans to dispose the remaining
51% co-ownership interest on March 4, 2020.
(Note5)
(Note3)
(Note4)
Portfolio Summary IIAs of financial announcement on Oct. 17, 2019
Note1:“Ratio” refers to the percentage in acquisition price of each property under management to the total acquisition price.Note2:Figures are rounded to the first decimal place for the “Ratio.” Totals for the “Ratio” may not tally due to this rounding.Note3:OJR changed its property name from “SUNROUTE PLAZA TOKYO” to “Tokyo Bay Maihama Hotel First Resort” on
Oct. 1, 2019.
40
Nihon Jisho Minami Aoyama Building Nov. 1997 2,548 0.4
CUBE Daikanyama Jan. 2003 2,435 0.4
aune Yurakucho Feb. 2007 9,900 1.5
Cross Avenue Harajuku Jun. 2010 4,815 0.7
J-ONE SQUARE Feb. 2007 1,510 0.2
JouLe SHIBUYA May 2008 7,550 1.1
SO-CAL LINK OMOTESANDO Apr. 2014 2,300 0.3
Kita Aoyama Building Apr. 2008 900 0.1
RemainingTokyo Wards
aune Ikebukuro Aug. 2010 6,410 1.0
aune Kohoku Mar. 2008 4,000 0.6
aune Makuhari Feb. 2008 3,600 0.5
Maruetsu Sagamino Nov. 2005 2,350 0.4
CROSS GARDEN KAWASAKI Feb. 2011 12,950 1.9
Tecc Land Totsuka (Land right) - 6,020 0.9
Clio Fujisawaekimae Feb. 2005 3,900 0.6
Kobe Momoyamadai Shopping Center (Land right) - 1,224 0.2
Home Center Musashi Sendai Izumi (Land right) - 2,350 0.4
aune Sapporo Ekimae Jul. 1994 1,900 0.3
Morioka Minami Shopping Center Sansa Nov. 2006 2,800 0.4
AEON TOWN Sendai-Izumiosawa (Land right) - 3,510 0.5
intervillage OH! MAGARI Jun. 2008 5,183 0.8
Valor Suzuka Shopping Center Apr. 2008 3,200 0.5
aune Sendai Nov. 1987 2,000 0.3
Friend Town Fukaebashi (Land right) - 2,400 0.4
KONAMI SPORTS CLUB KORIEN Nov. 2002 1,600 0.2
aune Tenjin Aug. 2009 4,550 0.7
Sendai Minamimachidori Building Nov. 2017 3,900 0.6
Felicita Sanjo Kiyamachi Jun. 2007 3,120 0.5
108,925 16.3
Type Area
RetailFacilities
Ratio (%)Property CompletionAcquisition
price(million yen)
6 CentralTokyo Wards
Other Parts ofthe Greater Tokyo
Area
Other Areas
Total of Retail Facilities
We Will Hatchobori Mar. 2008 2,370 0.4
Shibaura Island Air Tower Mar. 2007 6,030 0.9
Belle Face Togoshi Statio Nov. 2009 2,642 0.4
Belle Face Meguro Feb. 2010 3,330 0.5
Central Crib Roppongi Jan. 2006 7,493 1.1
Belle Face Kamata Nov. 2006 3,550 0.5
Belle Face Hongo Yumicho Nov. 2006 3,340 0.5
Belle Face Mishuku Jun. 2007 2,000 0.3
West Park Tower IKEBUKURO Dec. 2006 20,500 3.1
Belle Face Higashijujo Dec. 2007 3,000 0.4
Other Parts ofthe Greater Tokyo
AreaR-Styles Musashi-Kosugi Sep. 2006 4,433 0.7
Belle Face Osaka Shinmachi Feb. 2008 3,684 0.6
Belle Face Amagasaki Feb. 2009 3,440 0.5
Belle Face Kanazawa Kohrinbo Oct. 2006 2,410 0.4
68,222 10.2
Toda Logistics Center Mar. 2005 9,600 1.4
Ichikawa Logistics Center Jun. 2008 8,300 1.2
Iwatsuki Logistics Center Apr. 2013 6,300 0.9
Sakai Logistics Center North Building Jul. 2009 10,200 1.5
Komaki Logistics Center Sep. 2010 2,700 0.4
37,100 5.5
6 CentralTokyo Wards
TAKANAWA DUPLEX C's Aug. 2005 2,830 0.4
Cross Gate Sep. 2000 15,040 2.2
GOOD TIME LIVING Shin-urayasu Oct. 2006 1,550 0.2
Tokyo Bay Maihama Hotel First Resort Jun. 1986 26,800 4.0
VIA INN SHINSAIBASHI BLDG. Mar. 2011 3,100 0.5
HOTEL KEIHAN SAPPORO Apr. 2009 2,550 0.4
Richmond Hotel Yamagata Ekimae Dec. 2007 2,300 0.3
Hotel Nikko Himeji Sep. 1990 4,800 0.7
HOTEL LiVEMAX NAGOYA SAKAE-EAST Sep. 2017 1,500 0.2
Hotel Universal Port May 2005 34,000 5.1
94,470 14.1
668,630 100.0
6 CentralTokyo Wards
RemainingTokyo Wards
Area
ResidentialProperties
Type Ratio (%)Property CompletionAcquisition
price(million yen)
Total of Hotels and Others
Total
Other Parts ofthe Greater Tokyo
Area
Other Areas
Other Parts ofthe Greater Tokyo
Area
Other Areas
Total of Logistics Facilities
Other Areas
Total of Residential Properties
LogisticsFacilities
Hotels andOthers
(Note3)
Portfolio MapAs of financial announcement on Oct. 17, 2019
41
Portfolio Growth 42
Active asset reshuffle in view of market condition
99
668
-124
-200
-100
0
100
200
300
400
500
600
700
(billion yen)Offices Retail Facilities Residential Properties
Logistics Facilities Hotels and Others Dispositions
End of FP1
(Aug. 2002)
As of f inancial announcement
on Oct. 17,2019
Note: The above chart indicates the acquisition price of properties owned and the total acquisition price of disposed properties as of each fiscal period.
Property Name Area BuyerDisposition
date
Acquisition price
(million yen)
Disposition price
(million yen)
Book value(million yen)
(Note 2)
Estimated gain/loss of disposition(million yen)
OfficeKN Jiyugaoka
Plaza
Remaining Tokyo Wards
(Meguro-ku, Tokyo)
TOKYU REIT, Inc.
Oct. 1, 2019 and
Mar. 4, 2020(Note1)
3,110
Total 3,160
Ⅰ︓ 1,548Ⅱ︓ 1,611
(Note 1)
Ⅰ︓ 1,483Ⅱ︓ 1,541
Ⅰ︓ 53Ⅱ︓ 58
Retail Facility
Okayama KumeRetail Facility
Other Areas(Okayama-shi,
Okayama)
JALCO Co., Ltd. Sep. 26, 2019 2,750 2,750 2,289 415
Note 1: To be disposed over the following two periodsⅠ︓Oct. 1, 2019 1,548 million yen (The co-ownership interest of 49% in the property)Ⅱ︓Mar. 4, 2020 1,611 million yen (The co-ownership interest of 51% in the property)
Note 2: Book value is and estimate as of each transaction date. Estimated gain/loss on transfer is pro forma amount based on the book value and assumed transfer expenses as of the same date. The amounts are subject to change.
Disposed Properties during and after FP35(Aug. 2019)Disposition of properties in view of future competitiveness, profitability and market conditions
43
9.011.2
13.3 15.1 16.218.3 19.8 21.4
23.926.1
0
5
10
15
20
25
30
FP26Feb. 2015 End
FP27Aug. 2015 End
FP28Feb. 2016 End
FP29Aug. 2016 End
FP30Feb. 2017 End
FP31Aug. 2017 End
FP32Feb. 2018 End
FP33Aug. 2018 End
FP34Feb. 2019 End
FP35Aug. 2019 End
(%)Unrealized gain/loss ratio
Overview of Appraisal Value
Appraisal value by asset type (Note 3)
FP26Feb. 2015 End
FP27Aug. 2015 End
FP28Feb. 2016 End
FP29Aug. 2016 End
FP30Feb. 2017 End
FP31Aug. 2017 End
FP32Feb. 2018 End
FP33Aug. 2018 End
FP34Feb. 2019 End
FP35Aug. 2019 End
Properties96 96 102 106 109 110 110 111 109 110
Appraisal value(billion yen) 515.3 538.2 594.2 628.7 679.0 703.1 708.7 755 .8 760.9 776.4
Book value(billion yen) 472.8 483.9 524.3 546.0 584.4 594.4 591.8 622 .7 614.1 615.7
Unrealized gain/loss
(billion yen) (Note1) 42.5 54.2 69.8 82.6 94.5 108.6 116.9 133.1 146.8 160.6Unrealized gain/loss ratio
(%) (Note2) 9.0 11.2 13.3 15.1 16.2 18.3 19.8 21.4 23.9 26.1
Offices 52 321,428 402,820 4.0% 81,391 9,170 2.3% -0.1% 10,524
Retail Facilities 22 84,040 109,480 4.2% 25,439 -660 -0.6% -0.0% -311
Residential Properties 14 61,547 82,860 4.1% 21,312 1,600 2.0% -0.1% 2,095
Logistics Facilities 5 30,134 44,960 4.5% 14,825 -80 -0.2% 0.0% 326
Hotels and Others 10 88,818 101,860 4.3% 13,041 910 0.9% -0.1% 584Total:excluding properties not appraised by the direct ca pitalization method(Note 4) and acquired in and after FP35 (Aug. 2019) 103 585,969 741,980 4.1% 156,010 10,940 1.5% -0.1% 13,219
<Reference>Properties not appraised by the direct capitalizati on method (Note 4) 6 25,858 30,330 - 4,471 - - - -
Properties acquired in FP35 (Aug. 2019) 1 3,946 4,120 4.3% 173 - - - -
Properties owned as of the end of FP35 (Aug. 2019) 110 615,775 776,430 - 160,654 - - - -
Property type Properties
FP35 (Aug. 2019) Change from FP34 (Feb. 2019)
Cap RateChange of
Appraisal Ratio
Change of
Cap Rate
Book Value
(million y en)
Appraisal
Value
(million y en)
Unrealized Gain/Loss
(million y en)
Change of
Appraisal(million y en)
Change of Unrealized
Gain/Loss(million y en)
Note 1: Unrealized gain/loss is calculated by subtracting the book value at each given point in time from the appraisal value at the same time. Note 2: Unrealized gain/loss ratio is calculated in dividing the unrealized gain/loss at each given point in time by the book value at the same time. Note 3: Figures for “Cap Rate” in “Appraisal value by asset type” are calculated on a weighted average basis according to appraisal values and rounded to the first decimal place. Note 4: The term refers to “Aoyama Suncrest Building”, “Tecc Land Totsuka (Land right)”, “Kobe Momoyamadai Shopping Center (Land right)” , “Home Center Musashi Sendai Izumi (Land right)”, “AEON TOWN
Sendai-Izumiosawa (Land right)” and “Friend Town Fukaebashi (Land right)” for which the cap rate are not calculated based on the direct capitalization method.
44
Appraisal Value List as of the end of FP35 (Aug. 2019)
Appraisal Value List I
Change ofAppraisal
Change ofUnrealizedGain/Loss
(million yen) (million yen)● Aoyama Suncrest Building(Note) 10,169 13,360 - 3,190 440 3.4% - 458● Round-Cross Ichi-bancho 3,015 3,970 3.8% 954 140 3.7% -0.1% 158● Round-Cross Nishi Shinjuku 2,395 3,980 3.4% 1,584 120 3.1% -0.1% 128● DT Gaien 2,070 3,100 3.8% 1,029 140 4.7% -0.1% 140● Yoyogi Forest Building 1,367 1,650 4.0% 282 40 2.5% -0.1% 49● Round-Cross Akasaka 2,763 2,840 4.4% 76 60 2.2% -0.1% 70● Round-Cross Mita 1,659 1,640 4.4% -19 30 1.9% -0.1% 38● Round-Cross Shiba Daimon 2,311 3,530 4.2% 1,218 100 2.9% -0.1% 109● Round-Cross Tsukiji 2,982 3,880 4.4% 897 40 1.0% -0.1% 59● Shiba 2-chome Daiko Building 6,015 9,900 4.2% 3,884 220 2.3% -0.1% 266● Aoyama 246 Building 5,257 8,790 3.5% 3,532 190 2.2% -0.1% 196● Round-Cross Shinjuku 7,306 11,300 3.5% 3,993 400 3.7% 0.0% 423● Seafort Square Center Building 16,303 14,900 3.9% -1,403 400 2.8% -0.1% 348● ORIX Akasaka 2-chome Building 19,376 24,200 3.2% 4,823 800 3.4% -0.1% 895● Round-Cross Shinjuku 5-chome 3,741 4,490 3.7% 748 0 0.0% 0.0% 29● Nihonbashi Honcho 1-chome Building 9,294 9,260 3.5% -34 420 4.8% -0.1% 466● Round-Cross Shibuya 3,194 3,250 3.5% 55 60 1.9% 0.0% 74● ORIX Suidobashi Building 2,650 3,200 3.9% 549 80 2.6% -0.1% 96● ORIX Shinagawa Building 14,065 13,800 3.4% -265 500 3.8% -0.1% 550● ORIX Real Estate Nishi Shinjuku Building 12,906 14,700 3.6% 1,793 -200 -1.3% 0.0% -165 ● Round-Cross Tamachi 6,715 8,540 4.0% 1,824 240 2.9% 0.0% 257● MG Shirokanedai Building 8,435 8,930 3.9% 494 -70 -0.8% -0.1% -40 ● SHIBUYA PINE Bldg. 3,442 4,650 3.5% 1,207 -130 -2.7% 0.0% -120 ● MG Ichigaya Building 2,968 3,790 3.5% 821 80 2.2% -0.1% 94● Round-Cross Ginza 2-chome 5,130 6,420 3.3% 1,289 260 4.2% -0.1% 273● ARK Hills South Tower 21,679 25,800 3.1% 4,120 800 3.2% -0.1% 856● Round-Cross Akihabara 4,366 4,970 3.2% 603 140 2.9% -0.1% 147● Gaien Nishi-dori Building 9,107 10,550 3.5% 1,442 320 3.1% -0.1% 334● Round-Cross Roppongi 12,371 13,500 3.3% 1,128 400 3.1% -0.1% 426▲ Carrot Tower 3,574 7,060 4.1% 3,485 -100 -1.4% -0.1% -60 ▲ Beside Kiba 1,880 2,930 4.2% 1,049 50 1.7% -0.1% 69▲ ORIX Ikebukuro Building 8,060 13,400 3.9% 5,339 300 2.3% -0.1% 337▲ KN Jiyugaoka Plaza 3,030 3,040 4.1% 9 0 0.0% 0.0% 7▲ ORIX Meguro Building 5,771 9,290 4.1% 3,518 260 2.9% 0.0% 310▲ Akihabara Business Center 4,337 6,890 3.8% 2,552 0 0.0% 0.0% 46■ Neo City Mitaka 1,902 3,300 4.4% 1,397 10 0.3% -0.1% 9■ Round-Cross Kawasaki 3,861 6,900 4.5% 3,038 160 2.4% -0.1% 186■ Omiya Miyacho Building 3,612 4,910 4.8% 1,297 -110 -2.2% 0.0% -75 ■ Omiya Shimocho 1-chome Building 3,156 4,830 4.8% 1,673 10 0.2% 0.0% 43■ ORE Omiya Building 7,105 8,620 5.2% 1,514 220 2.6% 0.0% 227★ Nagoya Itochu Building 4,288 6,220 4.7% 1,931 250 4.2% -0.1% 305★ ORIX Koraibashi Building 4,256 5,950 4.0% 1,693 250 4.4% -0.1% 295★ Lunar Sendai 7,044 6,850 4.4% -194 70 1.0% -0.1% 138★ ORIX Nagoya Nishiki Building 10,293 9,940 4.0% -353 290 3.0% -0.1% 383★ ORE Sapporo Building 3,064 6,780 5.5% 3,715 170 2.6% -0.1% 233★ ORIX Kobe Sannomiya Building 3,028 4,470 5.2% 1,441 130 3.0% 0.0% 181★ ORE Nishiki 2-chome Bldg. 9,928 13,500 4.6% 3,571 100 0.7% 0.0% 207★ DOJIMA PLAZA BLDG. 9,264 12,400 3.9% 3,135 700 6.0% -0.1% 766★ PRIME SQUARE HIROSE-DORI 6,840 9,190 4.2% 2,349 230 2.6% -0.1% 289★ Hamamatsu Act Tower 12,655 13,300 5.8% 644 200 1.5% 0.0% 21★ ORIX Yodoyabashi Bldg. 4,956 5,970 4.0% 1,013 180 3.1% -0.1% 198★ SAPPORO BRICK CUBE 5,350 6,050 4.3% 699 220 3.8% -0.1% 219★ Round-Cross Kagoshima 1,263 1,500 5.7% 236 0 0.0% 0.0% 9
331,597 416,180 - 84,582 - - - -
Type Area Property
FP35 (Aug. 2019) Change from FP34 (Feb. 2019)
Cap RateChange of
Appraisal RatioChange ofCap Rate
Book Value(million yen)
AppraisalValue
(million yen)
UnrealizedGain/Loss
(million yen)
Offices
Total of Offices
Note: For the “Aoyama Suncrest Building”, the appraisal value and cap rate of the property is not calculated based on the direct capitalization method.
*Area symbol: ● 6 Central Tokyo Wards ▲ Remaining Tokyo Wards ■ Other Parts of the Greater
Tokyo Area ★ Other Areas
45
Appraisal Value List II
*Area symbol: ● 6 Central Tokyo Wards ▲ Remaining Tokyo Wards ■ Other Parts of the Greater
Tokyo Area ★ Other Areas
Change ofUnrealizedGain/Loss
(million yen)● Nihon Jisho Minami Aoyama Building 2,442 4,260 3.4% 1,817 90 2.2% -0.1% 94● CUBE Daikanyama 2,359 4,030 4.1% 1,670 50 1.3% -0.1% 55● aune Yurakucho 9,836 12,000 3.2% 2,163 0 0.0% 0.0% 16● Cross Avenue Harajuku 4,757 7,060 2.8% 2,302 -110 -1.5% 0.0% -102 ● J-ONE SQUARE 1,501 1,720 3.7% 218 -10 -0.6% 0.0% -7 ● JouLe SHIBUYA 7,450 9,040 3.3% 1,589 -60 -0.7% 0.0% -46 ● SO-CAL LINK OMOTESANDO 2,305 2,890 3.3% 584 0 0.0% 0.0% 1● Kita Aoyama Building 931 990 3.2% 58 20 2.1% -0.1% 23▲ aune Ikebukuro 6,043 7,660 3.7% 1,616 -90 -1.2% 0.0% -46 ■ aune Kohoku 3,285 4,370 4.6% 1,084 40 0.9% 0.0% 79■ aune Makuhari 3,036 4,900 4.9% 1,863 50 1.0% 0.0% 7■ Maruetsu Sagamino 2,198 2,760 5.0% 561 0 0.0% 0.0% -32 ■ CROSS GARDEN KAWASAKI 11,639 15,800 4.2% 4,160 0 0.0% 0.0% 112■ Tecc Land Totsuka (Land right)(Note1) 6,073 5,980 - -93 0 0.0% - 0■ Clio Fujisawaekimae 3,791 4,600 5.2% 808 -160 -3.4% 0.0% -131 ★ Kobe Momoyamadai Shopping Center (Land right)(Note1, 2) 1,268 1,270 - 1 - - - -★ Okayama Kume Retail Facility 2,294 3,120 6.2% 825 -190 -5.7% 0.3% -175 ★ Home Center Musashi Sendai Izumi (Land right)(Note1) 2,381 2,990 - 608 0 0.0% - 0★ aune Sapporo Ekimae 1,821 2,360 5.1% 538 -20 -0.8% 0.0% -12 ★ Morioka Minami Shopping Center Sansa 2,578 3,370 6.0% 791 10 0.3% 0.0% 35★ AEON TOWN Sendai-Izumiosawa (Land right)(Note1) 3,540 3,940 - 399 0 0.0% - 0★ intervillage OH! MAGARI 4,698 6,210 5.8% 1,511 0 0.0% 0.0% 63★ Valor Suzuka Shopping Center 3,010 3,250 5.6% 239 -310 -8.7% 0.0% -297 ★ aune Sendai 1,977 2,330 4.8% 352 30 1.3% -0.1% 26★ Friend Town Fukaebashi (Land right)(Note1) 2,424 2,790 - 365 -10 -0.4% - -10 ★ KONAMI SPORTS CLUB KORIEN 1,593 1,760 5.3% 166 0 0.0% 0.0% 8★ aune Tenjin 4,485 5,000 4.0% 514 0 0.0% 0.0% 16★ Sendai Minamimachidori Building 3,946 4,120 4.3% 173 - - - -
103,676 130,570 - 26,893 - - - -● We Will Hatchobori 2,055 2,670 4.0% 614 50 1.9% -0.1% 64● Shibaura Island Air Tower 4,625 7,580 4.5% 2,954 160 2.2% -0.1% 245● Belle Face Togoshi Statio 2,271 3,280 4.0% 1,008 80 2.5% -0.1% 104● Belle Face Meguro 3,054 4,240 3.7% 1,185 120 2.9% -0.1% 140● Central Crib Roppongi 7,437 9,100 3.7% 1,662 260 2.9% -0.1% 274▲ Belle Face Kamata 2,971 4,560 4.2% 1,588 110 2.5% -0.1% 140▲ Belle Face Hongo Yumicho 2,921 4,000 4.0% 1,078 100 2.6% -0.1% 120▲ Belle Face Mishuku 1,870 2,370 4.2% 499 10 0.4% -0.1% 21▲ West Park Tower IKEBUKURO 19,752 25,100 3.8% 5,347 600 2.4% -0.1% 688▲ Belle Face Higashijujo 2,814 3,350 4.2% 535 -40 -1.2% -0.1% -20 ■ R-Styles Musashi-Kosugi 3,934 5,360 4.8% 1,425 90 1.7% -0.1% 150★ Belle Face Osaka Shinmachi 2,902 4,710 4.6% 1,807 100 2.2% -0.1% 144★ Belle Face Amagasaki 2,764 3,930 4.7% 1,165 40 1.0% -0.1% 77★ Belle Face Kanazawa Kohrinbo 2,170 2,610 5.5% 439 -80 -3.0% -0.1% -56
61,547 82,860 - 21,312 - - - -■ Toda Logistics Center 8,194 11,400 4.2% 3,205 0 0.0% 0.0% 75■ Ichikawa Logistics Center 6,817 9,640 4.5% 2,822 -100 -1.0% 0.0% -25 ■ Iwatsuki Logistics Center 5,659 7,410 4.5% 1,750 0 0.0% 0.0% 70★ Sakai Logistics Center North Building 7,395 13,200 4.7% 5,804 0 0.0% 0.0% 145★ Komaki Logistics Center 2,066 3,310 4.9% 1,243 20 0.6% 0.0% 60
30,134 44,960 - 14,825 - - - -● TAKANAWA DUPLEX C's 2,825 3,220 4.4% 394 80 2.5% -0.1% 91■ Cross Gate 9,172 18,600 4.4% 9,427 0 0.0% -0.1% 102■ GOOD TIME LIVING Shin-urayasu 1,501 1,990 5.2% 488 0 0.0% 0.0% 0■ Tokyo Bay Maihama Hotel First Resort 27,374 28,100 4.2% 725 600 2.2% -0.1% 453★ VIA INN SHINSAIBASHI BLDG. 2,940 3,920 3.9% 979 100 2.6% -0.1% 124★ HOTEL KEIHAN SAPPORO 2,300 3,310 4.3% 1,009 100 3.1% -0.1% 131★ Richmond Hotel Yamagata Ekimae 2,079 2,460 5.5% 380 10 0.4% 0.0% 40★ Hotel Nikko Himeji 5,194 3,810 5.6% -1,384 -280 -6.8% 0.0% -616 ★ HOTEL LiVEMAX NAGOYA SAKAE-EAST 1,517 1,750 4.4% 232 0 0.0% 0.0% 12★ Hotel Universal Port 33,911 34,700 4.1% 788 300 0.9% -0.1% 245
88,818 101,860 - 13,041 - - - -615,775 776,430 - 160,654 - - - -
Type Area Property
Change from FP34 (Feb. 2019)
Cap RateChange of
Appraisal RatioChange ofCap Rate
LogisticsFacilities
Total of Logistics Facilities
FP35 (Aug. 2019)
Book Value(million yen)
AppraisalValue
(million yen)
UnrealizedGain/Loss
(million yen)
Change ofAppraisal
(million yen)
Total
RetailFacilities
Total of Retail Facilities
ResidentialProperties
Total of Residential Properties
Hotels andOthers
Total of Hotels and Others
Note1: For the “Tecc Land Totsuka (Land right)”,“Kobe Momoyamadai Shopping Center (Land right)” ,“Home Center Musashi Sendai Izumi (Land right)” , “AEON TOWN Sendai-Izumiosawa (Land right)” and“Friend Town Fukaebashi (Land right)”, the appraisalvalue and cap rate are not calculated based on the direct capitalization method.
Note2: OJR disposed a section of "Kobe MomoyamadaiShopping Center (Land right)" on February 19, 2019.
46
Investment Units by Unitholder Type
Note: Each share in Top 10 Unitholders is rounded down to the nearest whole number.
Investor Status
Unitholders by Type
47
Number of Units Share %(Note)
Japan Trustee Services Bank, Ltd.(Trust accounts) 645,452 23.3
The Master Trust Bank of Japan, Ltd. (Trust accounts) 460,067 16.6
The Nomura Trust and Banking Co., Ltd. (Investment accounts) 125,063 4.5
Trust & Custody Services Bank, Ltd. (Securities investment trust accounts) 124,827 4.5
SSBTC CLIENT OMNIBUS ACCOUNT 58,992 2.1
JPMorgan Securities Japan Co., Ltd. 47,909 1.7
NOMURA BANK (LUXEMBOURG) S. A. 37,798 1.3
STATE STREET BANK WEST CLIENT - TREATY 505234 33,974 1.2
THE BANK OF NEW YORK 133970 32,546 1.1
STATE STREET BANK AND TRUST COMPANY 505223 31,112 1.1
Top 10 Unitholders
End of FP35
(Aug. 2019)
Top 10 Unitholders
UnitsShare
%Units
Share%
Units Ratio
%
Individual 184,394 6.7 173,527 6.3 -10,867 -0.4
Financial institution 1,802,536 65.3 1,814,289 65.7 11,753 0.4
Major bank 0 0.0 0 0.0 0 0.0
Regional bank 103,735 3.8 98,700 3.6 -5,035 -0.2
Trust bank 1,433,001 51.9 1,427,124 51.7 -5,877 -0.2
Life insurance company 47,071 1.7 44,599 1.6 -2,472 -0.1
General insurance company 9,337 0.3 21,112 0.8 11,775 0.4
Securities company 131,090 4.7 136,775 5.0 5,685 0.3
Shinkin bank 38,239 1.4 37,904 1.4 -335 0.0
Others 40,063 1.5 48,075 1.7 8,012 0.3
Other Japanese Company 53,185 1.9 52,125 1.9 -1,060 0.0
Foreign company 719,885 26.1 720,059 26.1 174 0.0
2,760,000 100 2,760,000 100 0 -
Unitholders
FP34(Feb. 2019)
FP35(Aug. 2019)
Change
Total
UnitholdersShare
%Unitholders
Share%
UnitholdersRatio
%
Individual 18,998 95.9 17,778 95.6 -1,220 -0.3
Financial institution 188 0.9 186 1.0 -2 0.1
Major bank 0 0.0 0 0.0 0 0.0
Regional bank 39 0.2 36 0.2 -3 0.0
Trust bank 16 0.1 16 0.1 0 0.0
Life insurance company 9 0.0 9 0.0 0 0.0
General insurance company 3 0.0 2 0.0 -1 0.0
Securities company 17 0.1 21 0.1 4 0.0
Shinkin bank 55 0.3 53 0.3 -2 0.0
Others 49 0.2 49 0.3 0 0.1
Other Japanese Company 309 1.6 291 1.6 -18 0.0
Foreign company 321 1.6 339 1.8 18 0.2
19,816 100 18,594 100 -1,222 -Total
Unitholders
FP34(Feb. 2019)
FP35(Aug. 2019)
Change
(Note)Due Diligence means examination of properties from physical, legal and economic perspective.
Due Diligence (Note)
Investment and Asset ManagementDepartment Ⅰ〜Ⅲ
Application
Risk Management and ComplianceCommittee
including external committee member
qualified as attorney
Resolution
Investment Committeeincluding external committee member
qualified as real estate appraiser
OJR Board of Management<Directors do not have
conflicted interest >Prior consent
Decision of property acquisition/disposition
Execution of transaction
Risk Managementand Compliance
Department
Reject
Dissent
Legal andcompliance support
Return
Compliance System for Property Transaction
Risk Management and Compliance Committee
Comprised of the president and CEO, officer in charge of Risk Management and Compliance Department as well as external committee member qualified as attorney.Attendance and approval from officer in charge of Risk Management and Compliance Department as well as external committee member is required.
Investment Committee
Comprised of the president and CEO, OAM executive officer, officer in charge of RiskManagement and Compliance Department as well as external committee member qualified as real estate appraiser.Attendance and approval from external committee member is required.
Board of Management
Comprised of the Executive Director and 3 Supervisory Directors including real estate appraiser, attorney and certified public accountant with no conflicted interest.
RejectResolution
48
ORIX Asset Management Corporation
ORIX JREIT Inc.
Shareholders’ Meeting
Independent PublicAccountants
Board of Directors
President and CEO
Risk Management andCompliance Committee
Business Operation Management Department
General Affairs andAccounting Department
Finance and Investor Relations Department
Investment Committee
Strategic Planning Department
Risk Management andCompliance Department
Internal AuditDepartment
Corporate Auditor
Investment & AssetManagement Department I
Investment & Asset Management Department II
Investment & Asset Management Department III
Chairman
49
SustainabilityCommittee
Acquisition & Disposition, Management of Offices
Acquisition & Disposition, Management of Retail Facilities, Logistics Facilities, Residential Properties
Acquisition & Disposition, Management of Hotels
Company name
Head office
Representative
Date of establishment
Paid-in capital
Shareholder
Business
September 8, 2000
ORIX Asset Management Corporation
2-3-1 Hamamatsu-cho, Minato-ku, Tokyo
President and CEO Yoshitaka Kamemoto
100,000,000 yen
ORIX Corporation (100%)
Asset management
Corporate Profile of Asset Management Company
50Glossary I【Numerical Data 】・Numerical data is rounded down to the nearest whole number. However, percentages such as occupancy rate and LTV as well as building age and multiples are, in principle, rounded
to the first decimal place.
【Definition 】Terms Definition
3 properties acquisition and 2properties disposition
The term collectively refers to the acquisition of “TOKYU REIT Akasaka Hinokicho Building”, “Sendai Minamimachidori Building” and “Felicita SanjoKiyamachi” and the disposition of “KN Jiyugaoka Plaza” and “Okayama Kume Retail Facility”.
3 properties disposition duringFP34
The term refers to the disposition of “A Section of Kobe Momoyamadai Shopping Center (Land right),” “Cross Mall Shimonoseki-Chofu” and “GRAN MARTTegata”.
Acquisition priceThe term indicates the acquisition price stipulated in sales and purchase agreement, the term doesn’t include consumption tax and other transaction-related
costs.
Amount related to capital
gains
The term is calculated by deducting internal reserves and expenses for prepayment from capital gains on property dispositions for each fiscal period, and
dividing the said calculated results by number of investment units outstanding at the end of each fiscal period. Figures are rounded down to the nearest
whole number.
Annualized income after
depreciation
� At the end of each fiscal period, the term is calculated as the actual annualized income after depreciation for properties owned at the end of each fiscal
period.� As for the “TOKYU REIT Akasaka Hinokicho Building” and “Felicita Sanjo Kiyamachi”, the term is calculated by deducting depreciation expense
estimated by OJR from Net Operating Income based on the direct capitalization method indicated in the appraisal reports upon acquisition.
Annualized NOI
� At the end of each fiscal period, the term is calculated as the actual annualized income for each fiscal period about properties owned at the end of each
fiscal period.� As for the “TOKYU REIT Akasaka Hinokicho Building” and “Felicita Sanjo Kiyamachi”, the term indicates Net Operating Income based on the direct
capitalization method indicated in the appraisal reports obtained upon acquisition.
Appraisal Value� At the end of each fiscal period, the term indicates the appraisal value for properties owned at the end of each fiscal period.� As for the “TOKYU REIT Akasaka Hinokicho Building” and “Felicita Sanjo Kiyamachi”, the term indicates the appraisal value in the appraisal report
obtained upon acquisition.
Average duration to maturityThe term indicates the weighted-average calculated according to the remaining duration of each interest-bearing liability from each given point in time to its
repayment date or maturity date and the total balance of interest-bearing liabilities as of the same point in time. Figures are rounded to the first decimal place.
Average funding cost
The term indicates the annualized figures calculated by dividing “the total of interest expenses on debts and investment corporation bonds, financing-relatedexpenses excluding expenses related to both prepayments and commitment line contracts and the total of amortization of investment corporation bondissuance costs” booked in the profit and loss statements for each fiscal period by “the average balance of the total interest-bearing liabilities” for the samefiscal period. The figure is rounded to the nearest second decimal place.
Average interest rateThe term indicates the weighted-average interest rate (annual rate) based on the total balance of interest-bearing liabilities at each given point in time. The
figure is rounded to the second decimal place. With regard to the average interest rate on the portion of borrowings for which interest-rate swaps are
executed to hedge against the risk of interest rate fluctuation, the weighted-average interest rate is adjusted by the effect of relevant interest-rate swaps.
Book value� The term is based on the book value regarding properties owned at the end of each fiscal period.� As for the “TOKYU REIT Akasaka Hinokicho Building” and “Felicita Sanjo Kiyamachi”, the term indicates the acquisition prices.
Direct property managementor Direct PM
The term indicates the supplemental work of property management operations including leasing activities and activities to improve property value by ORIX
Asset Management Corporation which is the asset management company of OJR, while utilizing the ORIX Synergy.
51Glossary II
Terms Definition
Diversified REITThe term indicates real estate investment incorporations that invest in various types of property such as offices, retail facilities, residential properties, logistics
facilities, hotels and others.
Estimated depreciation
expenses or Depreciation
expenses estimated by OJR
The term is calculated based on straight-line method according to each useful life in the same manner as the existing properties owned by OJR
comprehensively in consideration of information indicated in engineering reports and others.
FFOThe term stands for “Funds From Operation” and it indicates the figure based on following formula:
“FFO” = Net income + Depreciation expenses + Cost of finance lease of property – capital gain/loss on disposition
Fixed-rate debt ratioThe term is calculated by dividing the balance of interest-bearing liabilities at the fixed-rate including interest-bearing liabilities at the fixed rate through
interest-rate swap at a given point in time by the total balance of interest-bearing liabilities as of the same point in time. The figure is rounded to the first
decimal place.
Free cash flow The term or FCF is calculated by the following formula:
Free cash flow = Depreciation expenses + Cost of finance lease of property – CAPEX
Income after depreciationThe term is calculated by the following formula:
Income after depreciation = NOI – Depreciation expenses for this fiscal period – Cost of finance lease of property
Internal reserves The term is calculated by adding additional reserves for the fiscal period to the balance of internal reserves at the end of the fiscal period.
LTV based on total assets
The term is calculated by dividing interest-bearing liabilities at a given point in time by total assets at the same point in time, and rounded to first decimal
place. In this document, it may also be referred to simply as "LTV".The “total assets” for each time point on the table is calculated as follows:
� As of the end of each fiscal period, the total assets as of the end of each fiscal period.� As of the financial announcement on Oct. 17, 2019, the total assets = the total assets as of the end of the FP35 (Aug. 2019) + debt financing amount
of 3,120 million yen for the acquisition of “Felicita Sanjo Kiyamachi”.
LTV based on unitholders’
capital
The term is calculated by dividing the balance of interest-bearing liabilities at a given point in time by the total of unitholders’ capital and the balance of
interest-bearing liabilities at the same point in time. The figure is rounded to the first decimal place.
NAVThe term is the abbreviation for “Net Asset Value” and is calculated by the following formula:
NAV = Unitholders’ capital + Unrealized gain/loss
NAV in consideration of
internal reserves
The term is calculated by the following formula:
NAV = Unitholders’ capital + Unrealized gain/loss + Internal reserves
NOI (Net Operating Income)The term is calculated based on the following formula. NOI = Net property income (Rental revenues – property-related expense) + Depreciation expenses for
the fiscal period. Rental revenues include revenues from finance lease of property and property-related expense includes cost of finance lease of property
respectively. Upon the calculation of NOI, cost of finance lease of property is added in Net property income for the fiscal period.
NOI yield The term is calculated by dividing “Annualized NOI” by “Acquisition price”. The figure is rounded to the first decimal place.
52Glossary III
Terms Definition
Occupancy rateThe term is calculated by dividing “Rented floor space” at a given point in time by “Rentable floor space” at the same point in time. The figure is rounded tothe first decimal place. The occupancy rate as of financial announcement on Oct. 17, 2019 represents the occupancy rate at the end of FP35 ended Aug. 31,2019.
ORIX Synergy The term refers to the cooperative relationship among OJR and ORIX Corporation and its group companies.
Previous financial
announcementThe term refers to the financial announcement for FP34 ended Feb. 28, 2019 released on Apr. 18, 2019.
Rent Fluctuation Rate
【The term refers to the definitions below:
At the time of tenant turnovers
� For compartments of which new monthly contract rents including assumed rents for each occupied compartment and former tenants’ contract rents are
comparable among new move-ins including assumed move-ins in each fiscal period, rent fluctuation rate is calculated by dividing the variance between
the total of new monthly contract rents and the total of former tenants’ contract rents by the total of former tenants’ contract rents. At the time of tenant renewal� As for office tenants for which rent is renewed including assumed renewals in each period, the figure is calculated by dividing the variance between the
total of new monthly contract rents (including assumed rents) in the given area and the total of pre-renewal monthly contract rents by the total of pre-renewal monthly contract rents. As for residential tenants whose contracts are renewed including renewal with the same rent, the figure is calculated bydividing the variance between total new monthly contract rents and total of pre-renewal monthly contract rents by the total of pre-renewal monthlycontract rent.
Rentable floor spaceThe term indicates the total floor space in OJR’s ownership portion of each real estate that is practically rentable including the common spaces if it is actually
under leasing. The owned portions or ownership ratio of OJR for each property are indicated.
Rented floor spaceThe term indicates the space included in the rentable space, which is actually under lease based on leasing agreements with tenants. The owned portions or
ownership ratio of OJR for each property are indicated.
The ratio of rent conditions
The term represents the ratio of “fixed rents” and “variable rents” in the overall portfolio and the results were round to the nearest whole number. Fixed rentsfor properties held at the end of FP 35 ended Aug. 31, 2019 are calculated based on the monthly contract rent as of the end of FP35 ended Aug. 31, 2019;fixed rents for properties acquired during FP 36 ending Feb. 29, 2020 are calculated based on the monthly contract rent at the end of August 2019. Variablerents are calculated by adding the 200 million yen received in advance in FP 33 ended Aug. 31, 2018 from the variable rents for FP 34 ended Feb. 28, 2019for Hotel Universal Port to the variable rents (including sales-based rents) for FP 34 ended Feb. 28, 2019 and FP 35 ended Aug. 31, 2019, and dividing thissum by 12. Variable rents are not applied to any of the properties acquired during FP 36 ending Feb. 29, 2020.
Unrealized gain/loss The term indicates the variance between “Appraisal value” and “Book value” of properties and it is rounded down to the nearest whole number.
Yield after depreciation The term is calculated by dividing “Annualized income after depreciation” by “Book value”. The figure is rounded to the first decimal place.
Asset Management Company ︓ORIX Asset Management Corporation
This document was provided and released solely with the intent of providing information.This document should not be construed as an offer or solicitation to buy or sell any specific product, including investment units.This document is not a disclosure document or statement of financial performance required by, or based on, Japan’s Financial Instruments and Exchange Law, Investment Trust and Investment Corporation Law, related cabinet orders, cabinet office ordinances or rules, the rules governing companies listed on the Tokyo Stock Exchange, or any other applicable rules. This document contains forward-looking statements, including forecasts of financial position, results of operations, and business-related matters, as well as statements related to the plans and goals of OJR and the management of ORIX Asset Management Corporation that provides asset management services for OJR. However, there are a number of known and unknown risks and uncertainties that can cause actual results or OJR’s performance to differ materially from any explicit or implicit forecasts contained herein.These forward-looking statements also rest on a number of assumptions with regard to OJR’s present and future management strategies, as well as the political and economical environments in which OJR will conduct its future business operations.Although the information contained in this document is the best available at the time of publication, no assurances can be given regarding the accuracy, certainty, validity or fairness of this information. The content of this document can be modified or withdrawn without prior notice.
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