Contents · Neighborhood SCs Store Community SCs Urban retail facilities Community shopping centers...

1

Contents

1. Overview of FRI

Overview of FRI ・・・・ 3

Management strategy ・・・・ 4

Portfolio map ・・・・ 5

Portfolio asset categories ・・・・ 6

2. Financial results and forecasts

Summary ・・・・ 9

Steady distribution growth ・・・・ 10

26th period results ・・・・ 11

27th period forecast ・・・・ 12

3. Management highlights

Management highlights— Large-scale shopping centers (regional SCs, outlet malls)

・・・・ 15

Management highlights— Community shopping centers (GMSs)

・・・・ 16

Management highlights— Medium-scale shopping centers (neighborhood SCs, supermarkets)

・・・・ 17

Management highlights— Urban retail facilities

・・・・ 18

Management highlights— Land interests and other properties

・・・・ 19

FRI and the retail market ・・・・ 20

Sound balance sheet ・・・・ 21

Internal growth—financial ・・・・ 22

Sustainability initiatives ・・・・ 23

4. Portfolio overview

Portfolio summary ・・・・ 27

FRI’s portfolio in graphs ・・・・ 29

Rent revision and lease maturity schedules ・・・・ 30

5. Appendix

All content in this document is provided solely for informational purposes with regard to Frontier Real Estate Investment Corporation (FRI) and is not intended to serve as an inducement or solicitation to trade in any product offered by FRI.

Investment units issued by FRI are subject to price fluctuations due to various factors, including: (1) volatility in the J-REIT market, interest rates and the real estate market; (2) fluctuations in rental revenues from properties; and (3) the occurrence of unexpected losses due to natural disasters. Accordingly, investment in FRI entails the risk of incurring a loss. Investment decisions are made at the investors’ discretion and risk. FRI disclaims any responsibility or liability for the consequences of investing in FRI.

Information provided in this document contains such forward-looking statements as business forecasts, which should not be construed as commitment to or guarantee of future performance. The information provided in this document was originally published in Japanese language form and has been translated for reference purposes only. FRI guarantees neither the completeness nor the accuracy of

this English translation. Please be advised that all information provided herein may be subject to change without prior notice. Duplication or reproduction of any content presented herein without the prior consent of FRI or its authorized representative is strictly prohibited.

Translation Purpose Only

１. Overview of FRI

3

Overview of FRI

Corporate profile

Name Frontier Real Estate Investment Corporation ("FRI")

TSE Listing August 9, 2004 Securities code: 8964

Sponsor Mitsui Fudosan Co., Ltd. Changed from Japan Tobacco Inc. as of March 2008

Investment target Retail facilities

Fiscal period ends June 30, December 31

Investment units issued 496,000

Asset management company Mitsui Fudosan Frontier REIT Management Inc. (Wholly owned subsidiary of Mitsui Fudosan)

Portfolio

Asset size1 ¥293.4 billion; 33 properties

Geographic distribution Urban areas: 51.9%; Other: 48.1%

Occupancy rate 100%

Total leasable floor space1 1,433,781 m2

Financial indicators

LTV 41.6%

Interest-bearing debt ratio

28.8%

Ratings JCR: AA Stable; R&I: AA- Stable; S&P: A+ Stable

Distributions

26th period (June 2017) ¥10,022 per unit

27th period (Dec. 2017) forecast1

¥10,080 per unit

1. As of August 15, 2017. All other figures are as of June 30, 2017.

2. Calculated based on the annualized fixed rent (excluding common area maintenance charges) of lease contracts valid as of June 30, 2017. Variable rent is not taken into account.

AEON MALL NAGOYADOME-Mae

Mitsui Outlet Park IRUMA

Mitsui Shopping Park LaLaport SHIN-MISATO

GINZA GLASSE

Key properties

Area2

Property type2

Tokyo metropolitan area 51.9%

Chubu 14.4%

Kansai 13.7%

Chugoku 10.6%

Kyushu/ Okinawa 9.4%

Regional SC 40.2%

Outlet Mall 6.7%

Community SC 11.6%

Neighborhood SC 8.9%

Supermarket 6.5%

Urban retail facility 18.4%

Other 7.7%

4

Management strategy

Turning fluctuating real estate revenue into steady distribution growth over the long term

External growth

Fully utilize the sponsor’s pipeline to continue acquiring excellent properties

Selectively invest in non-sponsor properties utilizing the Asset Management Company’s unique network, keeping a close eye on risk

Carefully select properties for investment considering the certainty of cash flows and growth potential of the surrounding retail zone

Make acquisitions with an eye to maintaining the whole portfolio’s ratio of asset value to yield after depreciation

Internal growth

Secure a foundation for stable earnings based on long-term fixed rent

Adjust to changes in the environments surrounding properties, maintaining and enhancing competitiveness through such measures as additional investment and tenant replacement

Consider replacing properties that pose future uncertainties in order to further enhance portfolio quality

Financial strategy

Maintain sound financial standing through LTV control

Execute capital procurement flexibly and strategically based on careful monitoring of the procurement environment

Leveling out repayment periods and amounts to increase financial stability

5

1411

7

41

19

20

1615

JR山手線25

2813 12

2722

21

3031

8

6

18

17

3 23

9

5

24

2 26 29

6

18

2

5

29

24

32

10

33

31 30 28

Omiya

Tachikawa

Yokohama

Portfolio map

33 properties

Asset size: ¥293.4 billion (as of August 15, 2017)

Yamanote Line

Kansai area

Chubu area

Chugoku area

Tokyo metropolitan area

QANAT Rakuhoku

AEON MALL Ibaraki

Belltown Tambaguchi Eki-Mae Store

Shinsaibashi Square


Mitsui Shopping Park LaLaport IWATA

(Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest)

Mitsui Shopping Park ALPARK (East Building)

You Me Town Hiroshima

26 10

8

Regional SC: A large-scale shopping center that houses multiple specialty stores.

Outlet mall: A large-scale shopping center in which multiple outlet stores are concentrated.

Community SC: A medium-scale shopping center (GMS) where the main tenant typically stocks general merchandise and groceries.

Neighborhood SC: A medium- or small-scale shopping center where the main tenant is typically a supermarket.

Supermarket: A supermarket that mainly sells food products.

Urban retail facilities: A store facing a main street or specialty store building in a prime urban location.

Other: Land interests, etc.

Kyushu/ Okinawa area

Papillon Plaza

Frespo Tosu (land interest)

TSUTAYA BOOK STORE TENJIN

VIORO

32 KOJIMA x BIC CAMERA Naha Store

3

23

17

9 AEON Shinagawa Seaside Shopping Center

Kamiikedai Tokyu Store

Summit Store Takinogawa Momiji-Bashi

Queen’s Isetan Suginami-Momoi


Costco Wholesale Warehouse Iruma (land interest)

Desigual Harajuku

Ito-Yokado Higashi-Yamato

AEON TOWN Tanashi-Shibakubo

GINZA GLASSE

Shimura Shopping Center

14

15

4

19

12

11

16

7

13

1

20

Mitsui Shopping Park LaLaport SHIN-MISATO Annex

Mitsui Shopping Park LaLagarden KASUKABE


Summit Store Yokohama Okano (land interest)

Costco Wholesale Warehouse Shin-Misato (land interest)

Ikebukuro Square

Super Viva Home Zama and Super Sanwa Zama Higashihara (land interest)

Kohnan Kawasaki-Odasakae Mall (land interest)

22

25

21

27

30

28

31

33

6

Portfolio asset categories

9 properties Average acquisition price: ¥4.6 bn

NOI yield: 5.7% NOI yield after depreciation: 4.1%







Large-scale shopping centers (regional SCs, outlet malls)

Medium-scale shopping centers (neighborhood SCs, supermarkets)

Urban retail facilities

Land interests and other properties

Outlet malls


You Me Town Hiroshima

AEON MALL Ibaraki Mitsui Shopping Park LaLaport IWATA






Costco Wholesale Warehouse Shin-Misato (land interest)


Costco Wholesale Warehouse

Iruma (land interest)

(Provisional name) Home Center Kohnan Hiroshima-Shi

Minami-Machi (land interest)

KOJIMA x BIC CAMERA Naha Store

TSUTAYA BOOK STORE TENJIN

VIORO Ikebukuro Square GINZA GLASSE Shinsaibashi Square Desigual Harajuku

AEON Shinagawa Seaside Shopping Center


Papillon Plaza Mitsui Shopping Park LaLagarden KASUKABE

QANAT Rakuhoku Shimura Shopping Center Queen’s Isetan Suginami-Momoi




Kamiikedai Tokyu Store Neighborhood SCs

Community SCs

Urban retail facilities

Other properties

Community shopping centers (GMS)

NOI yield and NOI yield after depreciation are calculated using figures as of June 30, 2017 (those for Super Viva Home Zama and Super Sanwa Zama Higashihara (land interest) are the forecast yields at the date of acquisition)

Super Viva Home Zama and Super Sanwa Zama

Higashihara (land interest)

Supermarkets



Regional SCs

¥30.3 billion

¥59.5 billion

¥41.4 billion

¥31.7 billion

Total acquisition price: ¥130.3 billion

2. Financial results and forecasts

9

Summary

Conservative financial operations

３

Agreement reached with new tenant, Don Quijote, for TSUTAYA BOOK STORE TENJIN(20-year contract)

Property to be renamed (provisional name) Don Quijote Tenjin (from August 24, 2017)

Acquired Super Viva Home Zama and Super Sanwa Zama Higashihara (land interest) using the Asset Management Companyʼs unique network

Acquisition price: ¥4,320 million

Appraisal value: ¥4,550 million

Assumed NOI yield: 3.7%

Acquisition date: July 31, 2017

(Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest), formerly Sports Club Renaissance Hiroshima, began generating revenue again

3 Initiatives to strengthen the portfolio

２ 26th period

27th period

Steady distribution growth

1 Aiming for a distribution per unit (DPU) of over ¥10,000 for two consecutive periods for the first time ever

DPU ¥10,022 (up ¥119 from the 25th period; ¥222 above forecast)

¥10,080 (forecast)

26th period

27th period

Maintained strong financial standing through conservative operations

LTV 26th period end: 41.6% (including leasehold and security deposits)

Interest-bearing debt ratio 26th period end: 28.8% (excluding leasehold and security deposits)

Reduced debt cost 26th period end: 0.69% (-0.03 pt from the 25th period end)

10

8,648

8,846.5

8,922.5

8,980

9,205.5

9,274

9,368.5

9,294

9,097.5

9,239

9,299.5

9,991

9,191

9,173.5

9,405

10,211

9,707

9,360

9,695 9,694

9,903 10,022

10,080

8,000

8,500

9,000

9,500

10,000

Distribution per unit

1,985

2,511 2,610 3,067

3,470 3,587 3,667

4,303

5,658

6,168 6,233 6,364

7,407 7,801

8,023 8,472

9,026

9,676 9,960

10,633 10,390

9,853 10,037 10,051

10,022 10,011

10,107

1,053 1,241 1,334 1,593

1,909 1,953 1,970 2,245

2,950 2,967 2,997 2,974

3,532 3,584 3,608 3,876

4,273 4,550 4,664

5,307 5,007

4,642 4,808 4,467

4,911 4,970

5,003

0

500

1,000

1,500

2,000

2,500

3,000

3,500

0

2,000

4,000

6,000

8,000

10,000

第1期

04/12月

第2期

05/6月

第3期

05/12月

第4期

06/6月

第5期

06/12月

第6期

07/6月

第7期

07/12月

第8期

08/6月

第9期

08/12月

第10期

09/6月

第11期

09/12月

第12期

10/6月

第13期

10/12月

第14期

11/6月

第15期

11/12月

第16期

12/6月

第17期

12/12月

第18期

13/6月

第19期

13/12月

第20期

14/6月

第21期

14/12月

第22期

15/6月

第23期

15/12月

第24期

16/6月

第25期

16/12月

第26期

17/6月

7,218.5

6,045

5,622

4,771.5

Steady distribution growth

July 2008 1st public offering

March 2008 Third-party allotment

July 2010 2nd public offering

July 2012 3rd public offering

March 2013 4th public offering

DPU*

(Forecast)

Operating revenue, net income and asset size

(yen)

(million yen)

(billion yen)

350

300

250

200

150

100

50

0 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th

Forecast**

Dec.‘04 Jun.’05 Dec.‘05 Jun.’06 Dec.’06 Jun.’07 Dec.’07 Jun.’08 Dec.‘08 Jun.’09 Dec.’09 Jun.’10 Dec.’10 Jun.’11 Dec.’11 Jun.’12 Dec.’12 Jun.‘13 Dec.’13 Jun. ’14 Dec.‘14 Jun.‘15 Dec.’15 Jun.’16 Dec. ‘16 Jun.‘17 Dec.’17

Operating revenue (left axis)

Net income (left axis)

Asset size (right axis)

* FRI implemented a two-for-one split of its investment units effective January 1, 2014. Distributions before the split have been divided by two.

** Distribution per unit (DPU), operating revenue and net income forecasts for the 27th period are given as the figures announced in “Summary of Financial Results for the 26th Fiscal Period,” published August 15, 2017.

11

26th period results

25th period (July 1, 2016 to

December 31, 2016)

26th period (January 1, 2017 to

June 30, 2017) Change

Operating revenue 10,022 10,011 -11 -0.1%

Expenses related to rent business (excluding depreciation)

1,927 1,974 +46

NOI 8,095 8,037 -58

Depreciation 2,156 2,117 -39

Property leasing operating income

5,939 5,920 -19

Selling, general and administrative expenses

560 619 +59

Operating income 5,379 5,300 -79 -1.5%

Non-operating income 3 6 +2

Non-operating expenses 332 334 +1

Ordinary income 5,050 4,971 -78 -1.6%

Extraordinary losses 137 － -137

Net income 4,911 4,970 +59 +1.2%

Distribution per unit (yen) 9,903 10,022 +119 +1.2%

Investment units issued and outstanding (units)

496,000 496,000 — pt

LTV at period-end 42.3% 41.6% -0.7 pt

Interest-bearing debt ratio 29.6% 28.8% -0.8

Number of properties 32 32 —

(b)

(d)

(e)

(f) (c)

(a)

(million yen) (million yen)

Note 1

Note 2

Note 3

Note 2

Note 2

Major factors in changes

Note 1. Operating revenue Full-period operation of 25th period acquisition

(50% stake in Mitsui Shopping Park LaLaport SHIN-MISATO) +95

Sales-linked rent +10

Income from utilities expenses -22

Absence of lump-sum payments received due to tenant change at Sports Club Renaissance Hiroshima (former name) -91

Absence of rent due to reconstruction at Sports Club Renaissance Hiroshima (former name) -11

Note 2. Expenses related to rent business/Selling, general and administrative expenses Property and city planning taxes for properties

acquired in the 24th and 25 periods (KOJIMA x BIC CAMERA Naha Store and a 50% stake in Mitsui Shopping Park LaLaport SHIN-MISATO, respectively) +50

Utilities expenses -12

Depreciation -39

Change in asset management fee rates +70

Note 3. Extraordinary losses Absence of loss on retirement of building for Sports

Club Renaissance Hiroshima (former name) -137

Reference: Financial indicators FFO per unit (d) ¥14,291 NAV per unit (e) ¥415,987 Interest coverage ratio

(f) 23.0 times

a. Selling, general and administrative expenses = Asset custody fee + Administrative service fees + Directors’ compensations + Other operating expenses

b. Loan-to-value ratio = (Borrowings and bonds + Leasehold and security deposits – Unrestricted cash and deposits†) / (Balance of total assets – Unrestricted cash and deposits)

c. Interest-bearing debt ratio = (Borrowings and bonds – Unrestricted cash and deposits) / (Balance of total assets – Unrestricted cash and deposits)

d. Funds from operations per unit = (Net income + Depreciation) / Investment units issued and outstanding

e. Net asset value per unit = (Net assets + Unrealized gain or loss) / Investment units issued and outstanding

f. Interest coverage ratio = EBITDA / Interest expenses

† Unrestricted cash and deposits = Cash and cash equivalents – distributions for the period

12

27th period forecast

26th period results (January 1, 2017 to

June 30, 2017)

27th period forecast (a)

(July 1, 2017 to December 31, 2017)

Change

Operating revenue 10,011 10,107 +96 +1.0%

Operating income 5,300 5,313 +13 +0.3%

Ordinary income 4,971 5,004 +32 +0.7%

Net income 4,970 5,003 +32 +0.7%

Distribution per unit (yen)

10,022 10,080 +58 +0.6%

(単位：百万円)

Investment units issued and outstanding (units)

496,000 496,000

LTV at period-end 41.6% Approx. 42%

Number of properties

32 33 Major expenses

26th period results

27th period

forecast

Property tax, city planning tax 1,043 1,043

Depreciation 2,117 2,066

Non-operating expenses 334 310

(b)

a. Forward-looking figures given here are as announced in “Summary of Financial Results for the 26th Fiscal Period,” published August 15, 2017.

b. Loan-to-value ratio = (Borrowings and bonds + Leasehold and security deposits – Unrestricted cash and deposits) / (Balance of total assets – Unrestricted cash and deposits)

Note 1

Note 2

Major factors in changes

Note 1. Operating revenue Rent from 27th period acquisition (Super Viva

Home Zama and Super Sanwa Zama Higashihara (land interest) and full-period operation of (Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest) +147

Sales-linked rent -17

Income from utilities expenses +23

Rent due to tenant change at TSUTAYA BOOK STORE TENJIN -24

Decrease due to contract termination at VIORO during the 27th period -41

Note 2. Operating income (excluding difference in operating revenue)

Repairs and maintenance -77

Utilities expenses -18

Depreciation +50

Selling, general and administrative expenses -36

(million yen) (million yen)

3. Management highlights

15

Introduced sales-linked rent after large-scale renovations in 2015. →Continued to generate sales-linked rent in the 26th period

Ritsumeikan University

Osaka-Ibaraki Campus now open →Major increase in daytime population

JR line underpass to open in spring 2018

→Will expand the retail zone

Repairs of exterior walls planned

Reinforced revenue base due to full-period operation starting in the 26th period

FRI’s greatest investment area Total acquisition price of ¥27.5 billion together with LaLaport SHIN-MISATO Annex and Costco Wholesale Warehouse Shin-Misato (land interest)

Mitsui Shopping Park LaLaport SHIN-MISATO (regional SC)

AEON MALL Ibaraki (regional SC)

JR武蔵野線

AEON MALL Ibaraki

Underpass

7 min. on foot

FRI properties

Logistics zone

Commercial zone

Residential zone

Adjacent to a station

Over 7: 27.7%

Under 7: 72.3%

Excellent locations near train stations

Over 70% adjacent to a station

Minutes on foot to nearest train station1

Percentage of total annual rent

46.9%

Portion under master leases

100%

Stable revenue base

Features of FRIʼs large-scale shopping centers

1. Calculated based on the annualized fixed rent (excluding common area maintenance charges) of lease contracts valid as of June 30, 2017. Variable rent is not taken into account.

Among the largest outlet malls in the Tokyo metropolitan area, attracting customers from a broad area, with synergies with the neighboring Costco Wholesale Warehouse Iruma

Generates sales-linked rent every period

Mitsui Outlet Park IRUMA (outlet mall)

大宮

さいたま

所沢

東京新宿

渋谷

品川

立川

国分寺

八王子

Just off the Iruma IC

Management highlights— Large-scale shopping centers (regional SCs, outlet malls)

Shin-Misato Sta.

LaLaport SHIN-MISATO Costco

Shin-Misato

Connected to station

IKEA Annex

JR Musashino Line



16

Features of FRIʼs community shopping centers

Higashiyamato ranked first among Tokyo municipalities in 2015 birthrate

survey Forms the leading retail area in

Higashiyamato City with neighboring retail facilities

Nojima store newly opened on the second floor on June 2017

In discussions regarding rent revisions (November 2012 and November 2015)

Ito-Yokado Higashi-Yamato (community SC)

Percentage of total annual rent accounted for by community shopping centers

Flagship central Tokyo AEON Group retail facility

Located in the Shinagawa Seaside Forest, a mixed-use facility with office,

retail and hotel space, enabling the capture of office workers’ weekday dining and other consumption

Approximately 1,800 condominiums under construction within a 500 m radius

AEON Shinagawa Seaside Shopping Center (community SC)

Radius Population 2010–2015

growth

1 km 40,000 +7.5%

3 km 267,000 +8.3%

5 km 793,000 +9.1%


YAOKO

Management highlights— Community shopping centers (GMSs)

Further growth expected

23.2% 16.4% 11.6%

0.0%

10.0%

20.0%

30.0%

第16期第21期第26期 16th 21st 26th

FRI owns only community SCs in excellent locations in Tokyo with growing populations

500 m

Shinagawa Seaside Sta. Aomono-Yokocho Sta.

Seaside Forest

AEON Shinagawa To be completed

Nov. 2019 687 units

To be completed Feb. 2019 817 units

To be completed Oct. 2018 335 units

Planned development near AEON Shinagawa

Approx. 1,800 condominiums

to be completed by 2020

17

Renovated by master lessee (Mitsui Fudosan) in anticipation of the facility’s 10-year anniversary in November 2017

Mitsui Shopping Park LaLagarden KASUKABE (neighborhood SC)

H2O Retail Group, the main tenant, has acquired an adjacent lot

Now looking into future internal growth opportunities

In discussions regarding rent revisions (January 2015 )

QANAT Rakuhoku (neighborhood SC)

カナート洛北

高野川

Local retail zone population growing due to neighboring condominium development

Contract to reach maturity in April 2019 Now looking into future internal

growth opportunities

Papillon Plaza (neighborhood SC)

More accommodating and enjoyable for visitors of all ages, from older adults to families with children

Five new stores, including Wakuwaku Hiroba, a store offering vegetables and other foods direct from producers, and seven renovated stores

Papillon Plaza

Takano River

Hakata Sta.

Yoshizuka Sta.

Radius Population

2010–2015

growth

1 km 33,000 +15.3%

3 km 210,000 +15.3%

5 km 512,000 +11.9%

Management highlights— Medium-scale shopping centers (neighborhood SCs, supermarkets)

Adjacent lot (approx, 6,300 m2)

(approx. 13,000 m2 )

QANAT Rakuhoku

Nearby housing

development

3 min. to Hakata station

Renovated baby care room, kids’ restrooms, community room and

employee break room *Concept images

18

GINZA GLASSE roadside land price

0

5,000

10,000

15,000

20,000

25,000

1980 1985 1990 1995 2000 2005 2010 2015

Features of FRIʼs urban retail facilities

FRI owns stores with street level access and buildings that house specialty

stores in prime urban locations with high liquidity

These properties account for a growing portion of overall portfolio rent FRI maintains a good balance of acquisitions from the sponsor (sponsor-

developed properties) and from third parties

Percentage of total annual rent accounted for by urban retail facilities

12.5%

18.4%

Successor to TSUTAYA, Don Quijote, to rent the entire property from

August 24, 2017, achieving tenant change with no downtime

To be renamed (provisional name) Don Quijote Tenjin (Aug. 24th, 2017)

The lengthening of the Nanakuma subway line (to be completed in 2020) will improve access to Hakata Station

TSUTAYA BOOK STORE TENJIN / (Provisional name) Don Quijote Tenjin

VIORO

26th (Jan.–Jun.)

27th (Jul.–Dec.)

Jul. Aug. Sep. Oct. Nov. Dec.

Previous tenant:

TSUTAYA

New tenant: Don Quijote

Aug. 23—contract cancellation

November Facility opening

Aug. 24—new contract begins

Rent payments begin

Original maturity

Tenant Don Quijote Co., Ltd.

Contract type

Fixed-term building lease

Contract period

Aug. 2017–Mar. 2038 (just under 21 years)

Leased floor space

4,532.38 m2

Original contract

start

Source: National Tax Agency

●Brooks Brothers

Don Quijote

●Sony Store

H&M●

●DIESEL

Muji●

Apple Store●

●ZARA

Ikebukuro Tenjin Harajuku Ginza

Acquired from the sponsor Acquired from third parties

Shinsaibashi

Management highlights— Urban retail facilities

At 16th period-end

At 26th period-end

(year)

(Thousand yen/m2)

Nishitetsu Fukuoka (Tenjin) Sta.

19

Super Viva Home Zama and Super Sanwa Zama Higashihara (land interest)

27th period acquisition

Easy access via Yamato-Atsugi Bypass (National Route 246)

Offers synergy with neighboring Costco Wholesale Zama Warehouse

商圏人口 2012/ 2007比

1km 2.5万人 102.8%

3km 24.7万人 102.1%

5km 57.3万人 102.3%

Viva Home/ Super Sanwa

Costco

Demolished the Sports Club Renaissance Hiroshima building, and will now

operate the property as a land interest Began generating rent (for the land) July 1, 2017, contributing to revenue

from the 27th period onward Synergies with the nearby You Me Town Hiroshima expected after the new

facility opens

Management highlights— Land interests and other properties

(Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest)

Radius Population 2007–2012

growth

1 km 25,000 +2.8%

3 km 247,000 +2.1%

5 km 573,000 +2.3%

25th (Jul.–Dec.) 26th (Jan.–Jun.) 27th (Jul.–Dec.)

New tenant: Kohnan Shoji

New contract begins Aug. 1

Demolition of existing building (completed)

New construction Operations begin autumn 2017

Rent payments begin

Location 2 Minami-machi, Minami-ku, Hiroshima City, Hiroshima

Period-end book value (assumed NOI yield)

¥1,754 million (7.6%)

Contract period Aug. 2016–Jul. 2037 (21 years) (fixed-term business-use land lease contract)

Leased floor space 6,055.14 m2

Location 1 Higashihara, Zama City, Kanagawa

Acquisition price (assumed NOI yield)

¥4,320 million (3.7%)

Appraisal value ¥4,550 million

Acquisition date July 31, 2017

Contract period Jul. 2014–Jul. 2044 (30 years) (fixed-term business-use lease contract)

Leased floor space 28,926.76 m2

20

（trillion yen）

5.8%

4.8%

39.6%

10.8%

17.9%

6.0%

3.1%

12.0%

Year-on-year comparison of monthly sales at FRI properties

-30%

-20%

-10%

0%

10%

20%

30%

2016/0

4

2016/0

5

2016/0

6

2016/0

7

2016/0

8

2016/0

9

2016/1

0

2016/1

1

2016/1

2

2017/0

1

2017/0

2

2017/0

3

2017/0

4

2017/0

5

2017/0

6

SC FRI

Source: SC sales statistics report, Japan Council of Shopping Centers

＊ Calculated based on sales at properties for which comparisons with the previous year are possible

FRI and the retail market

1.1 1.4 2.0 3.5 3.7

0

1

2

3

4

5

6

2012 2013 2014 2015 2016 2017 2020 Source: Consumption Trend Survey for Foreigners Visiting Japan, Japan Tourism Agency

（trillion yen）

BtoC E-commerce market size and e-commerce adoption rate (product sales)

Source: Ministry of Economy, Trade and Industry FY2016 E-Commerce Market Survey

5.99 6.80 7.24 8.00

3.85%

4.37% 4.75%

5.43%

0%

1%

2%

3%

4%

5%

6%

7%

0

3

6

9

2013 2014 2015 2016

EC市場規模（左目盛） EC化率（右目盛）

Annual retail product sales by region

Annual retail

product sales by region

Distribution of FRI

properties*

＊ Calculated based on the annualized fixed rent (excluding common area maintenance charges) of lease contracts valid as of June 30, 2017. Variable rent is not taken into account.

■Hokkaido ■Tohoku ■Tokyo metropolitan area ■Chubu ■Kansai ■Chugoku ■Shikoku ■Kyushu/Okinawa

51.9%

14.4%

13.7%

10.6%

9.4%

Source: Data on 2016 retail sales volumes by regional Bureau of Economy, Trade and Industry, Ministry of Economy, Trade and Industry

Consumption by overseas tourists visiting Japan

E-commerce adoption rate (right axis)

E-commerce market size (left axis)

Government target:

¥8 trillion

21

LTV ratio2 42.3% 41.6%

Interest-bearing debt ratio3 29.6% 28.8%

Long-term debt ratio 88.4% 84.6%

25th (December 31, 2016)

26th (June 30, 2017)

Balance of borrowings and bonds ¥86,400 million ¥86,400 million

Balance of leasehold and security deposits1 ¥34,032 million ¥33,951 million

Total balance of liabilities ¥120,432 million ¥120,351 million

Sound balance sheet

Key financial indicators

Unrealized gain based on appraisal value NAV

NAV growth +30.5% over five years

Cash and deposits, etc. ¥ 16 billion

Book value of assets under management ¥258.7 billion

Net assets ¥151.7 billion

Borrowings and bonds ¥86.4 billion

Leasehold and security deposits ¥33.9 billion

Unrealized gain ¥54.5 billion

¥206.3 billion (NAV)

Other liabilities ¥2.7 billion

¥ 120.3 billion

Total assets: ¥274.8 billion (as of June 30, 2017)

1. For an overview of leasehold and security deposits, please see p. 46 2. LTV = (Borrowings and bonds + Leasehold and security deposits – Unrestricted cash and deposits) /

(Balance of total assets – Unrestricted cash and deposits) 3. Interest-bearing debt ratio = (Borrowings and bonds – Unrestricted cash and deposits) /

(Balance of total assets – Unrestricted cash and deposits)

¥313.3 billion (Appraisal value)

¥54.5 billion (billion yen)

17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th

250

200

150

100

50

0

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

10th

11th

12th

13th

14th

15th

16th

17th

18th

19th

20th

21st

22nd

23rd

24th

25th

26th

(billion yen)

60

50

40

30

20

10

0

Unrealized gain based on appraisal value and NAV

22

Internal growth—financial

0

50

100

150

第27期

第28期

第29期

第30期

第31期

第32期

第33期

第34期

第35期

第36期

第37期

第38期

第39期

第40期

第41期

第42期

第43期

第44期

第45期

第46期

第47期

第48期

第49期

第50期

第51期

第54期

第55期

長期借入金保証金

381 400

385 376 381 369 358 339

303 307

30,000

40,000

50,000

60,000

70,000

80,000

90,000

第17期第18期第19期第20期第21期第22期第23期第24期第25期第26期

200

250

300

350

400

450

500

Investment corporation bonds

Distribution of maturity dates

Refinancing to reduce debt cost(excluding short-term loans) Average remaining loan/bond period and debt cost (at each period end)

Balance of borrowings and bonds and interest paid

2.98

3.58 3.70 3.64 3.70 3.93 4.04

4.32

4.84 4.83

1.11% 1.08% 1.09% 1.07% 1.05% 0.98%

0.92% 0.84%

0.69%

-0.20%

0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

2

3

4

5

6

7

8

第17期第18期第19期第20期第21期第22期第23期第24期第25期第26期

残存年数（左軸）調達コスト（右軸） (%)

Average including leasehold and security

deposits:

0.52%

0.72%


Debt cost (right axis)

Years remaining (left axis)

(years)

Average including leasehold and security

deposits:

6.04

(million yen) (million yen) ■ Balance of borrowings and bonds (left axis) ■ Interest paid

(right axis) (as of August 15, 2017) Commitment line

(billion yen)

15

10

5

0

27th

28th

29th

30th

31st

32nd

33rd

34th

35th

36th

37th

38th

39th

40th

41st

42nd

43rd

44th

45th

46th

47th

48th

49th

50th

55th

Long-term borrowings

Security deposits

Long-term borrowings in 26th

Long-term borrowings in 27th

（%）

0.91

0.51%

1.06

0.36%

1.07

0.27%

1.98

0.43%

1.41

0.35%

1.23

0.98 1.04

0.78

0.20

0.80

1.40

2.00

3.9 4.5 5.0

7.0 6.0 5.6 6.1

7.0 6.3

8.8

5.9

9.8 11.6

8.0

0

4

8

12

第22期第23期第24期第25期第26期第27期第28期第29期第30期 (years) 22nd 23rd 24th 25th 26th 27th 28th 29th 30th

Average interest rate of repayments in each period

Average interest rate of new loans/bonds in each period

Average period of repayments in each period

Average period of new loans/bonds in each period

Impact on DPU:

+¥148


23

Sustainability initiatives

12%reduction 14%reduction 26%reduction

Reducing environmental burden Contributing to society

Per-unit reductions in fiscal 2016 (compared with fiscal 2013 levels)

*Fiscal 2013 levels as 100%

Energy Water Waste

4% average annual reduction



Wind power turbines

Quick chargers for electric vehicles

Green walls Wind power turbines with small solar panels

LaLaport SHIN-MISATO LaLaport IWATA

Facility Participants Clothing collected

Additional donations

LaLagarden KASUKABE 480 2,568 kg ¥10,810

LaLaport SHIN-MISATO 315 1,363 kg ¥17,534

LaLaport IWATA 389 1,947 kg ¥13,987

ALPARK (Hiroshima) 418 1,781 kg ¥27,391

Results of events at FRI properties (May–June 2017)

1,602 7,659 kg ¥69,722 participants of clothing collected in additional donations

17th &EARTH Clothing Support Project

& EARTH Clothing Support Project Carried out twice annually since 2008, this project is organized by the Mitsui Fudosan Group and invites people to donate unneeded clothing at retail facilities. This clothing is then distributed to people in need through the NPO Japan Relief Clothing Center.

Coverage ratio: More than 90% of the overall portfolio (floor space basis)

24

Sustainability initiatives

Four FRI properties newly certified

DBJ Green Building Certification A comprehensive evaluation system for real estate properties demonstrating high environmental and social awareness. Based on a proprietary scoring model developed by Development Bank of Japan Inc. (DBJ), certified properties receive a rank of one to five stars.

★★★★★

★★★

GRESB (Global Real Estate Sustainability Benchmark)

GRESB assesses the sustainability of real estate companies and operators, and is used by leading global institutional investors to help select investment targets.

External certification

(22nd period) ★★★★★ ★★★★

★★★

DBJ Green Building Certification

GRESB Real Estate Assessment

Rank ★★★★★：Property with the best class environmental & social awareness ★★★：Property with excellent environmental & social awareness

26th period certifications Previously certified properties

★★★★

★★★

★★★

★★★

Recognized for providing superior convenience that meets the needs of diverse consumers, through such means as offering ample facilities for children and installing charging points for electric vehicles.



GINZA GLASSE Ikebukuro Square

VIORO AEON MALL

Ibaraki




(22nd period)

(24th period) (24th period)

(24th period)

■ East Asia / Retail / Listed 1st (of 6 entities)

■Global

101st (of 733 entities)

4. Portfolio overview

27

Portfolio summary

No. Property name Acquisition

date Seller1 Acquisition

price Total leasable floor space2

Occupancy rate2

Appraisal value

Age (years)

Main tenants3 PML4

1 AEON Shinagawa Seaside Shopping Center Aug. 2004 JT 20,100 77,547 m2 100% 19,100 14.7 AEON Retail 14%

2 AEON MALL Ibaraki Aug. 2004 JT 18,100 151,092 m2 100% 23,800 16.6 AEON Retail 13%

3 Papillon Plaza Aug. 2004 JT 4,810 17,095 m2 100% 5,330 23.6 Royal Home Center 1%

4 Kamiikedai Tokyu Store Aug. 2004 JT 1,490 6,640 m2 100% 1,820 15.3 Tokyu Store 11%

5 Belltown Tambaguchi Eki-Mae Store Aug. 2005 JT 2,130 11,176 m2 100% 2,820 11.9 Matsumoto 9%

6 AEON MALL NAGOYADOME-Mae Mar. 2006 JT 24,800 154,766 m2 100% 25,200 11.3 AEON Retail 13%

7 Summit Store Takinogawa Momiji-Bashi Sep. 2006 JT 3,100 6,455 m2 100% 3,630 10.8 Summit 12%

8 (Provisional name) Home Center Kohnan Hiroshima- -Shi Minami-Machi (land interest) 5 Apr. 2007 JT 1,940 6,055 m2 100% 2,540 — Kohnan Shoji —

9 Frespo Tosu (land interest) Nov. 2007 JT 3,178 79,447 m2 100% 3,060 — Daiwa Lease —

10 You Me Town Hiroshima Feb. 2008 JT 23,200 122,169 m2 100% 21,600 9.4 Izumi 10%

11 Queen’s Isetan Suginami-Momoi Jul. 2008 MF, etc. 3,560 5,212 m2 100% 4,110 12.6 Isetan Mitsukoshi Food Service 12%

12 Mitsui Outlet Park IRUMA Jul. 2008 MF, etc. 19,900 98,714 m2 100% 22,600 9.3 Mitsui Fudosan 14%

13 Costco Wholesale Warehouse Iruma (land interest) Jul. 2008 MF, etc. 2,600 24,019 m2 100% 2,750 — Costco —

14 Desigual Harajuku6 Oct. 2008 Non-sponsor 3,100 1,149 m2 100% 3,400 18.7 INTS 14%

15 Ito-Yokado Higashi-Yamato Jan. 2009 Non-sponsor 11,600 53,374 m2 100% 11,100 13.6 Ito-Yokado 12%

16 AEON TOWN Tanashi-Shibakubo Feb. 2009 MF, etc. 3,100 8,785 m2 100% 3,300 12.3 AEON Town 11%

17 TSUTAYA BOOK STORE TENJIN7 Dec. 2009 Non-sponsor 3,700 4,532 m2 100% 4,180 10.0 TSUTAYA 2%

18 Mitsui Shopping Park LaLaport IWATA Jul. 2010 MF, etc. 15,200 136,136 m2 100% 15,400 8.1 Mitsui Fudosan 16%

19 GINZA GLASSE Jul. 2010 MF, etc. 13,600 5,174 m2 100% 15,100 9.2 — 11%

20 Shimura Shopping Center Jan. 2011 Non-sponsor 4,430 17,126 m2 100% 5,690 16.6 Summit 14%

21 Mitsui Shopping Park LaLagarden KASUKABE Feb. 2011 MF, etc. 10,000 63,415 m2 100% 11,000 9.7 Mitsui Fudosan 13%

22 Summit Store Yokohama Okano (land interest) Feb. 2012 Non-sponsor 5,700 14,394 m2 100% 6,630 — Summit —

23 VIORO Feb. 2012 Non-sponsor 10,100 5,834 m2 98.8% 11,900 10.8 — 1%

24 QANAT Rakuhoku Jul. 2012 MF, etc. 8,800 48,303 m2 100% 9,010 16.6 H2O Asset Management 9%

25 Ikebukuro Square Feb. 2013 MF, etc. 20,400 8,863 m2 100% 24,400 4.6 Round One 14%

(million yen)

28

Portfolio summary

No. Property name Acquisition

date Seller1 Acquisition

price Total leasable floor space2

Occupancy rate2

Appraisal value

Age (years)

Main tenants3 PML4

26 Mitsui Shopping Park ALPARK (East Building) Feb. 2013 MF, etc. 5,400 65,603 m2 100% 5,520 27.2 Mitsui Fudosan 12%

27 Kohnan Kawasaki-Odasakae Mall (land interest) Jan. 2014 Non-sponsor 7,000 23,393 m2 100% 8,710 — Kohnan Shoji —

28 Mitsui Shopping Park LaLaport SHIN-MISATO Annex

Mar. 2014 MF, etc. 3,930 6,714 m2 100% 3,980 5.2 FOREVER21 12%

29 Shinsaibashi Square Mar. 2015 MF, etc. 8,620 1,750 m2 100% 9,010 2.8 Burberry Japan 7%

30 Mitsui Shopping Park LaLaport SHIN-MISATO8 Apr. 2015 Aug. 2016

MF, etc. 19,840 142,315 m2 100% 20,300 7.9 Mitsui Fudosan 11%

31 Costco Wholesale Warehouse Shin-Misato (land interest)

Apr. 2015 MF, etc. 3,810 30,292 m2 100% 3,950 — Costco —

32 KOJIMA x BIC CAMERA Naha Store Jan. 2016 Non-sponsor 1,850 7,301 m2 100% 2,410 11.3 Kojima 6%

Total (32 properties, as of Jun. 30, 2017) 289,088 1,404,855 m2 100% 313,350 11.1 7.67%

33 Super Viva Home Zama and Super Sanwa Zama Higashihara (land interest) 9

Jul. 2017 Non-sponsor 4,320 28,926 m2 100% 4,550 — Sumitomo Mitsui Finance and Leasing

—

Total (33 properties, as of Aug. 15, 2017) 293,408 1,433,781 m2 100%

(million yen)

1. “MF, etc.” represents Mitsui Fudosan and its consolidated subsidiaries as well as special purpose companies in which Mitsui Fudosan has invested.

2. For properties for which pass-through type master lease contracts are concluded, the figures are as at June 30, 2017, calculated on an end tenant basis.

3. For multi-tenant properties and properties for which pass-through type master lease contracts are concluded, the end tenant that leases the largest portion of leasable floor space is shown if they lease

more than 30% of the total.

4. PML represents the probable maximum loss in earthquake risk analysis. The values stated for AEON MALL Ibaraki and Mitsui Outlet Park IRUMA are for the store buildings. The figure for Desigual Harajuku includes the portion of the building that was demolished as of October 29, 2012. The figure for Shinsaibashi Square is for the north tower. The value listed under Total represents the PML value at June 30, 2017 of the entire portfolio (properties from No. 1 to No. 32) as a whole, not the average value of the properties in the portfolio.

5. The acquisition price is as at the time of acquisition and includes the price of the building on the property at the time (¥208 million). Said building was demolished as of December 2016.

6. The acquisition price is as at the time of acquisition and includes a portion of the site sold on July 30, 2012 (cost of sales: ¥259 million).

7. FRI and TSUTAYA Co., Ltd. have reached an agreement to terminate the lease contract for the property effective August 23, 2017. FRI entered a fixed-term building lease with the new tenant, Don

Quijote Co., Ltd., on July 31, 2017.

8. FRI acquired a 16% co-ownership stake on April 1, 2015, and an addition 50% co-ownership stake on August 10, 2016, but the total leasable floor space presented here is that for the entire property.

The acquisition price presented is the total after the additional acquisition.

9. This property’s appraisal value is as at the date of acquisition.

29

Average contract term: 18.８ years

FRIʼs portfolio in graphs

1. All figures are calculated based on the annualized fixed rent (excluding common area maintenance charges) of lease contracts valid as of June 30, 2017. Variable rent is not taken into account. The ratio of fixed rent and sales-linked rent is that of the 26th fiscal period

2. Based on acquisition price, excluding properties operated as land interests.

3. Balance of time remaining until the next rent revision date or contract maturity date, whichever is earlier.

Sales-linked rent 1.3%

Fixed rent 98.7%

Over 10 years 22.6%

5 to 10 years 39.6%

3 to 5 years 12.8%

3 years or less 25.0%

Over 10 years 52.4%

5 to 10 years 32.1%


Over 10 years 88.0%

5 to 10 years 8.9%


Tokyo metropolitan area 51.9%

Chubu 14.4%

Kansai 13.7%

Chugoku 10.6%

Kyushu/ Okinawa 9.4%

AEON Group 25.4%

Mitsui Fudosan 25.8%

Izumi 7.8%

Summit 4.3%

Round One 4.1%

Other 32.7%

Regional SC 40.2%

Outlet Mall 6.7%

Community SC 11.6%

Neighborhood SC 8.9%

Supermarket 6.5%

Urban retail facility 18.4%

Other 7.7%

Building age2


5 to 10 years 39.9%

Over 20 years 3.9%

10 to 20 years 45.3%

Area Property

type Tenants

Contract term

Remaining contract

term

Period remaining until rent revision3

Ratio of fixed rent and sales-linked rent

Average remaining contract term: 11.0 years

Average building age: 11.1 years

30

Rent revision and lease maturity schedules

1. For multi-tenant properties and properties for which pass-through type master lease contracts are concluded, the end tenant that leases the largest leased floor space is shown if they lease over 30% of the total. 2. ML: Master lease contract; P: Pass-through type master lease contract (in which the amount of rent that the master lessee pays FRI is the same as the amount of rent that end tenants are contracted to pay the master lessee); S: Contract with a single tenant;

M: Contract with multiple tenants; T: Traditional lease; F: Fixed-term lease 3. Figures are calculated based on the annualized fixed rent (excluding common area maintenance charges) of lease contracts valid as of June 31, 2017. 4. FRI has a direct lease contract with Royal Home Center and pass-through type master lease contracts with the other end tenants. 5. FRI and TSUTAYA Co., Ltd. have reached an agreement to terminate the lease contract for the property effective August 23, 2017. FRI entered a fixed-term building lease with the new tenant, Don Quijote Co., Ltd., on July 31, 2017. 6. The main tenant and the rent revision and lease maturity schedules are not disclosed as the status of contracts with end tenants varies significantly.

Property name Main tenant1 Contract

type2

Sales-linked rent

Percentage of total annual rent3

2017 2018 2019 2020 2021

Lease maturity 26th 27th 28th 29th 30th 31th 32th 33th 34th 35th

1 AEON Shinagawa Seaside Shopping Center AEON Retail ML T 7.7% Oct-22

2 AEON MALL Ibaraki AEON Retail ML F ○ 7.9% Apr-35

3 Papillon Plaza Royal Home Center M/P4 F/T 2.1% Apr-19

4 Kamiikedai Tokyu Store Tokyu Store ML F 0.6% Mar-22

5 Belltown Tambaguchi Eki-Mae Store Matsumoto ML F 0.9% Aug-25

6 AEON MALL NAGOYADOME-Mae AEON Retail ML F 8.1% Mar-26

7 Summit Store Takinogawa Momiji-Bashi Summit S F 1.0% Sep-26

8 (Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest)

Kohnan Shoji S F Undisclosed Jul-37

9 Frespo Tosu (land interest) Daiwa Lease S F 1.2% Nov-27

10 You Me Town Hiroshima Izumi ML F 7.8% Feb-28

11 Queen’s Isetan Suginami-Momoi Isetan Mitsukoshi Food Service

ML F ○ 1.2% Dec-24

12 Mitsui Outlet Park IRUMA Mitsui Fudosan ML F ○ 6.7% Jul-38

13 Costco Wholesale Warehouse Iruma (land interest)

Costco S F 0.8% Apr-38

14 Desigual Harajuku INTS S F ○ 0.7% Sep-22

15 Ito-Yokado Higashi-Yamato Ito-Yokado ML T 4.0% Nov-23

16 AEON TOWN Tanashi-Shibakubo AEON Town ML T ○ 1.2% Mar-25

17 TSUTAYA BOOK STORE TENJIN 5 TSUTAYA S F 1.5% Mar-38

18 Mitsui Shopping Park LaLaport IWATA Mitsui Fudosan ML F ○ 6.3% Jun-30

19 GINZA GLASSE6 — P F/T 3.7% -

20 Shimura Shopping Center Summit ML T 1.7% Nov-20

21 Mitsui Shopping Park LaLagarden KASUKABE Mitsui Fudosan ML T ○ 3.9% Feb-31

22 Summit Store Yokohama Okano (land interest) Summit S F 1.6% Nov-31

23 VIORO6 — P F ○ 3.8% -

24 QANAT Rakuhoku H2O Asset Management ML T ○ 2.9% Nov-20

25 Ikebukuro Square Round One M F 6.7% Dec-32

26 Mitsui Shopping Park ALPARK (East Building) Mitsui Fudosan ML T ○ 2.8% Feb-33

27 Kohnan Kawasaki-Odasakae Mall (land interest) Kohnan Shoji S F 2.2% Jan-36

28 Mitsui Shopping Park LaLaport SHIN-MISATO Annex

FOREVER21 P F/T ○ 1.2% Apr-22

29 Shinsaibashi Square Burberry Japan M F Undisclosed Undisclosed

30 Mitsui Shopping Park LaLaport SHIN-MISATO Mitsui Fudosan ML T ○ 6.1% Mar-35

31 Costco Wholesale Warehouse Shin-Misato (land interest)

Costco S F Undisclosed Undisclosed

32 KOJIMA x BIC CAMERA Naha Store Kojima S F Undisclosed May-27

Revision

Maturity

Revision Revision

Revision

Revision Maturity

Maturity Revision

New Contract

Recontracting

5. Appendix

33

25th period (July 1, 2016 to

December 31, 2016)


June 30, 2017) Change Major factors in changes

Amount % of total Amount % of total Amount % change

Operating revenue 10,022 100.0% 10,011 100.0% －11 －0.1%

Rent revenue–real estate1 9,893 9,947 54 Rent revenue–other2 129 63 －65

Operating expenses 4,643 46.3% 4,711 47.1% 67 1.5%

Expenses related to rent business

4,083 4,091 7

Property management expenses3 471 495 23

Property and other taxes4 997 1,043 45

Casualty insurance 13 13 0

Repairs and maintenance 200 218 17

Depreciation5 2,156 2,117 －39

Other expenses6 243 203 －40 Selling, general and administrative expenses7

560 619 59

Asset management fee 428 498 69

Asset custody fee 13 13 0

Administrative service fees 22 21 －0

Directors' compensations 6 6 －

Other 89 79 －9

Operating income 5,379 53.7% 5,300 52.9% －79 －1.5%

Non-operating income 3 6 2

Non-operating expenses 332 334 1

Interest expenses 320 321 1

Other 12 12 －0

Ordinary income 5,050 50.4% 4,971 49.7% －78 －1.6%

Extraordinary losses8 137 －－137

Income before income taxes 4,912 49.0% 4,971 49.7% 59 1.2%

Income taxes (after net adjustment) 0 0 0

Net income 4,911 49.0% 4,970 49.7% 59 1.2%

Unappropriated retained earnings 4,912 49.0% 4,971 49.7% 59 1.2%

Statement of income

(million yen)

1

Full-period operation of 25th period acquisition (50% stake in Mitsui Shopping Park LaLaport SHIN-MISATO)

+95

Sales-linked rent Income from utilities expenses Absence of rent due to reconstruction at Sports Club Renaissance Hiroshima (former name)

+10 －22 －11

VIORO: Rent －14

2

Absence of lump sum income from tenant change at Sports Club Renaissance Hiroshima (former name)

－91

VIORO: Penalty payment income, etc. +25

3

AEON Shinagawa Seaside Shopping Center, VIORO, others: Building management expenses

+24

4

Property and city planning taxes for properties acquired in the 24th and 25 periods (KOJIMA x BIC CAMERA Naha Store and a 50% stake in Mitsui Shopping Park LaLaport SHIN-MISATO, respectively)

+50

5

25th period acquisition (50% stake in Mitsui Shopping Park LaLaport SHIN-MISATO)

+17

Completion of amortization of properties’ attached facilities, etc. (AEON MALL Ibaraki, Shimura Shopping Center, etc.)

－56

6

Utilities expenses －12

VIORO: Absence of 10th anniversary sales promotion expenses

－32

7

Change in asset management fee rates +70

Promotional expenses －6

8

Absence of loss on retirement of building for Sports Club Renaissance Hiroshima (former name)

－137

34

Balance sheet (assets)

25th Period (as of Dec. 31, 2016)

26th Period (as of June 30, 2017)

Change Major factors in changes


Current assets 13,441 4.9% 15,998 5.8% 2,557 19.0%

Cash and deposits1 9,411 11,800 2,389

Cash and deposits in trust1 3,487 4,031 544

Other2 542 165 －376

Non-current assets (including deferred assets)

260,822 95.1% 258,828 94.2% －1,994 －0.8%

Property, plant and equipment3 260,751 258,770 －1,980

Buildings 39,009 37,995 －1,013

Structures 425 393 －32

Tools, furniture and fixtures 33 32 －0

Land 72,924 72,924 －

Buildings in trust 34,295 33,405 －889

Structures in trust 409 383 －26

Machinery and equipment in trust

256 222 －33

Tools, furniture and fixtures in trust

35 41 5

Land in trust 113,359 113,359 －

Construction in progress in trust

1 12 10

Intangible assets 1 1 －0

Investments and other assets4 69 56 －13

Total assets 274,263 100.0% 274,826 100.0% 563 0.2%

(million yen)

1.

Cash and deposits matching depreciation +2,117

Payments for construction at properties －142

Partial return of security deposits －276

Leasehold deposits received due to tenant change

+202

Consumption taxes payable +317

Consumption taxes receivable +364

2.

Consumption taxes receivable －364

3.

26th period capital expenses +125

Depreciation －2,117

4.

Amortization of insurance payments －12

35

25th Period (as of Dec. 31, 2016)

26th Period (as of June 30, 2017)

Change Major factors in changes


Current liabilities 16,120 5.9% 21,208 7.7% 5,088 31.6%

Short-term loans payable1 14,000 18,500 4,500

Operating accounts payable 646 870 223

Accrued expenses 248 257 9

Advances received 1,048 1,098 50

Other3 177 482 305

Non-current liabilities 106,451 38.8% 101,867 37.1% －4,584 －4.3%

Long-term loans payable2 69,400 64,900 －4,500

Investment corporation bonds 3,000 3,000 －

Tenant leasehold and security deposits3 17,950 17,672 －277

Tenant leasehold and security deposits in trust3 16,082 16,278 196

Other 19 15 －3

Total liabilities 122,571 44.7% 123,075 44.8% 503 0.4%

Unitholders’ capital 146,590 53.4% 146,590 53.3% －

Total surplus 5,100 1.9% 5,159 1.9% 59

Reserve for reduction entry 188 188 －

Unappropriated retained earnings

4,912 4,971 59

Total net assets4 151,691 55.3% 151,750 55.2% 59 0.0%

Total liabilities and net assets 274,263 100.0% 274,826 100.0% 563 0.2%

Balance sheet (liabilities and net assets)

(million yen)

1.

Extension of short-term loans －5,000

Current portion of long-term loans payable +9,500

2.

Extension of short-term loans +5,000

Current portion of long-term loans payable －9,500

3.

Partial return of security deposits －276

Leasehold deposits received due to tenant change

+202

4.

Net assets per unit (yen):

At the end of 25th period 305,829円

At the end of 26th period 305,948円

36

Item 25th period

(July 1, 2016 to December 31, 2016)


June 30, 2017)

Cash flows from operating activities

Income before income taxes 4,912 4,971

Depreciation and amortization 2,156 2,117

Other (757) 980

Net cash provided by (used in) operating activities 6,311 8,069

Cash flows from investing activities

Purchase of property, plant and equipment (17) (39)

Purchase of property, plant and equipment in trust (15,229) (103)

Repayments of tenant leasehold and security deposits (297) (278)

Proceeds from tenant leasehold and security deposits 71 1

Repayments of tenant leasehold and security deposits in trust (517) (43)

Proceeds from tenant leasehold and security deposits in trust 462 239

Payments of restricted bank deposits in trust (9) (201)

Net cash provided by (used in) investment activities (15,537) (424)

Cash flows from financing activities

Proceeds from short-term loans payable 65,000 25,000

Repayment of short-term loans payable (63,000) (27,000)

Proceeds from long-term loans payable 7,000 5,000

Repayment of long-term loans payable (4,440) (3,000)

Proceeds from issuance of investment corporation bonds 3,000 —

Redemption of investment corporation bonds (22) (0)

Payments for investment corporation bond issuance costs (4,808) (4,911)

Net cash provided by (used in) financing activities 2,729 (4,911)

Net increase (decrease) in cash and cash equivalents (6,495) 2,732

Cash and cash equivalents at beginning of period 18,958 12,462

Cash and cash equivalents at end of period 12,462 15,194

(million yen)

Statement of cash flows

37

6.2% 6.2% 6.3% 6.2% 6.3%

5.6% 5.6% 5.7% 5.6% 5.6%

5.4% 5.3% 5.2% 5.2% 5.2%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

第22期

（15/6月）

第23期

（15/12月）

第24期

（16/6月）

第25期

（16/12月）

第26期

（17/6月）

帳簿価額ベース取得価格ベース鑑定価額ベース

4.5% 4.5% 4.6% 4.5% 4.6%

4.1% 4.1% 4.2% 4.1% 4.1%

3.9% 3.8% 3.8% 3.8% 3.8%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

第22期

（15/6月）

第23期

（15/12月）

第24期

（16/6月）

第25期

（16/12月）

第26期

（17/6月）

帳簿価額ベース取得価格ベース鑑定価額ベース

(yen)

41.7% 41.2% 39.1%

42.3% 41.6%

27.5% 27.2% 25.5%

29.6% 28.8%

0%

10%

20%

30%

40%

50%

第22期

（15/6月）

第23期

（15/12月）

第24期

（16/6月）

第25期

（16/12月）

第26期

（17/6月）

LTV

有利子負債比率

383,309 393,714

404,873 409,596 415,987

305,972 306,307 305,620 305,829 305,948

200,000

250,000

300,000

350,000

400,000

450,000

第22期

（15/6月）

第23期

（15/12月）

第24期

（16/6月）

第25期

（16/12月）

第26期

（17/6月）

一口当たりNAV

一口当たりBPS

NOI yield* Yield after depreciation*

LTV / Interest-bearing debt ratio NAV per unit / BPS per unit

Key indicators

22nd (June ‘15)

23rd (Dec. ’15)

24th (June ‘16)

25th (Dec. ’16)

26th (June. ’17)

22nd (June ‘15)

23rd (Dec. ’15)

24th (June ‘16)

25th (Dec. ’16)

26th (June. ’17)

22nd (June ‘15)

23rd (Dec. ’15)

24th (June ‘16)

25th (Dec. ’16)

26th (June. ’17)

22nd (June ‘15)

23rd (Dec. ’15)

24th (June ‘16)

25th (Dec. ’16)

26th (June. ’17)

Book value basis

Appraisal value basis

Acquisition price basis

Book value basis

Appraisal value basis

Acquisition price basis

NAV per unit

BPS per unit

LTV Interest-bearing debt ratio

* The above figures are calculated excluding extraordinary factors.

38

1. NOI = Property leasing operating income + Depreciation 2. Part of the land of AEON MALL Ibaraki was sold to Ibaraki City on October 12, 2010 (area of 118.86 m2 and book value of ¥15 million) for ¥19 million. However, the figure given here is calculated using the price

at the time of acquisition. 3. FRI’s contract with RENAISSANCE INC. reached maturity on July 31, 2016. FRI entered a new fixed-term business-use land lease contract with Kohnan Shoji Co., Ltd. on August 1, 2016. FRI received lump-sum

payments totaling ¥91 million as a result of this tenant change and the reconstruction of the building on the property. 4. Only NOI is disclosed, as FRI has not obtained the permission of the lessee to disclose other information

Real estate rent revenue Expenses related to rent business Property leasing

operating income

NOI1

NOI yield

Total Rent

revenue – real estate

Rent revenue –

other Total

Property and other

taxes

Property management

expenses

Casualty insurance

Repairs and maintenance

Depreciation Other

expenses (to acquisition

price)2 (to book value)


25th 742 737 4 359 88 37 1 12 214 5 383 597 5.9% 7.6%

26th 742 737 4 359 87 46 1 4 214 4 383 598 6.0% 7.7%

AEON MALL Ibaraki 25th 779 773 5 347 96 17 0 30 201 1 431 632 7.0% 8.7%

26th 774 768 5 296 96 16 0 17 162 1 478 640 7.1% 8.9%

Papillon Plaza 25th 222 222 0 96 32 37 0 3 21 1 125 146 6.1％ 6.5％

26th 222 222 0 90 32 37 0 0 18 1 132 150 6.3％ 6.7％

Kamiikedai Tokyu Store 25th 53 53 - 44 5 2 0 26 10 0 8 18 2.5％ 3.0％

26th 53 53 - 17 5 1 0 - 10 0 35 46 6.2％ 7.4％


25th 84 84 - 21 9 1 0 0 10 - 63 73 6.9％ 7.8％

26th 84 84 - 21 9 1 0 0 10 - 63 73 6.9％ 7.9％


25th 773 773 - 260 91 15 0 3 148 - 513 662 5.3％ 6.3％

26th 773 773 - 254 91 15 0 0 146 - 519 665 5.4％ 6.3％


25th 99 99 - 20 6 1 0 - 12 - 78 90 5.9％ 6.3％

26th 99 99 - 20 6 1 0 0 12 - 78 90 5.8％ 6.3％

(Provisional name) Home Center Kohnan Hiroshima-

Shi Minami-Machi (land interest)3

25th 103 11 91 8 7 0 0 - 0 0 94 95 - -

26th Not disclosed4 －5 - -


25th 118 118 0 16 16 - - - - 0 101 101 6.4％ 6.2％

26th 118 118 0 16 16 - - - - 0 101 101 6.4％ 6.2％

You Me Town Hiroshima 25th 745 745 0 247 89 14 0 - 142 - 497 640 5.5％ 6.3％

26th 745 745 0 247 89 14 0 - 142 - 497 640 5.5％ 6.4％


25th 112 112 - 22 8 2 0 - 11 0 89 101 5.7％ 6.0％

26th 112 112 - 23 8 2 0 0 11 0 89 100 5.7％ 6.0％

Mitsui Outlet Park IRUMA 25th 694 694 0 289 47 14 1 14 211 0 404 616 6.2％ 7.4％

26th 714 714 0 319 47 16 1 42 211 0 395 606 6.1％ 7.4％

(million yen)

Leasing income and expenses by property

39



operating income

NOI1

NOI yield

Total Rent


Rent revenue –

other Total

Property and other

taxes

Property management

expenses

Casualty insurance


Depreciation Other



Costco Wholesale Warehouse Iruma

(land interest)

25th 78 78 0 7 4 - - 2 - - 70 70 5.5％ 5.4％

26th 78 78 0 4 4 - - - - - 73 73 5.7％ 5.6％

Desigual Harajuku 25th 66 66 - 12 7 1 0 - 3 0 53 57 3.7％ 3.9％

26th 66 66 - 12 7 1 0 - 3 0 53 57 3.7％ 3.9％


25th 380 380 - 167 41 8 0 2 115 0 212 327 5.6％ 6.5％

26th 380 380 - 168 41 8 0 2 115 0 211 327 5.6％ 6.6％


25th 114 114 - 32 11 2 0 1 17 0 82 99 6.4％ 6.9％

26th 114 114 - 31 11 2 0 - 17 0 83 100 6.5％ 7.1％

TSUTAYA BOOKSTORE TENJIN3

25th 147 147 - 49 8 6 0 1 32 0 97 130 7.1％ 7.7％

26th 147 147 - 54 8 4 0 2 32 5 92 125 6.8％ 7.5％


25th 600 600 0 364 71 12 0 13 265 0 236 501 6.6％ 8.3％

26th 601 601 0 369 71 13 0 18 265 0 231 496 6.5％ 8.4％

GINZA GLASSE 25th 423 423 - 222 42 65 0 6 54 52 200 255 3.8％ 3.9％

26th 415 415 - 219 42 65 0 8 55 47 196 252 3.7％ 3.9％

Shimura Shopping Center 25th 158 158 0 63 15 3 0 0 43 0 94 138 6.3％ 6.5％

26th 158 158 0 46 15 3 0 0 27 0 111 138 6.3％ 6.6％


25th 370 370 - 162 37 7 0 3 112 0 208 320 6.4％ 7.2％

26th 370 370 - 177 37 8 0 16 114 0 192 307 6.1％ 7.0％


25th 154 147 7 10 10 - - - - - 144 144 5.1％ 4.9％

26th 154 147 7 10 10 - - - - - 144 144 5.1％ 4.9％

VIORO 25th 543 524 18 332 39 106 0 12 52 121 210 262 5.2％ 5.4％

26th 540 495 44 315 39 122 0 14 52 86 224 276 5.5％ 5.7％

QANAT Rakuhoku 25th 276 276 - 166 38 7 0 27 92 0 109 202 4.6％ 5.0％

26th 276 276 - 206 38 8 0 66 93 0 69 163 3.7％ 4.1％

(million yen)

1. NOI = Property leasing operating income + Depreciation 2. Part of the land of Desigual Harajuku was sold to the Tokyo Metropolitan Government on July 30, 2012 (area of 26.86 m2 and book value of ¥259 million) for ¥333 million and compensation for transfer of

property, etc. (approx. ¥55 million) was received due to the removal of part of the building, etc. However, the figure given here is calculated using the price at the time of acquisition. 3. FRI and TSUTAYA Co., Ltd. have reached an agreement to terminate the lease contract for the property effective August 23, 2017. FRI entered a fixed-term building lease with the new tenant, Don Quijote Co.,

Ltd., on July 31, 2017.

40



operating income

NOI1

NOI yield

Total Rent


Rent revenue –

other Total

Property and other

taxes

Property management

expenses

Casualty insurance


Depreciation Other



Ikebukuro Square 25th 694 694 - 266 40 63 0 0 120 41 427 548 5.4％ 5.6％

26th 690 690 0 261 40 61 0 0 120 38 429 550 5.4％ 5.6％


25th 264 264 - 176 56 6 2 25 85 - 87 173 6.4％ 6.8％

26th 264 264 - 152 56 5 2 2 85 - 111 197 7.3％ 7.9％


25th 208 208 0 20 20 0 - - - 0 187 187 5.4％ 5.3％

26th 208 208 0 20 20 0 - - - 0 187 187 5.4％ 5.3％


Annex

25th 145 145 0 74 7 13 0 0 34 18 71 105 5.4％ 5.6％

26th 140 140 0 72 7 13 0 2 34 15 67 101 5.2％ 5.4％

Shinsaibashi Square

25th Not disclosed3

174 4.1％ 4.0％

26th Not disclosed3

174 4.0％ 4.0％

Mitsui Shopping Park LaLaport SHIN-MISATO4

25th 490 490 - 157 14 10 1 6 124 0 333 457 - -

26th 586 586 - 231 60 12 1 14 142 0 354 496 5.0% 5.1%

Costco Wholesale Warehouse Shin-Misato

(land interest)

25th Not disclosed3 86 4.5％ 4.5％


KOJIMA x BIC CAMERA Naha Store



Total 25th 10,022 9,893 129 4,083 997 471 13 200 2,156 243 5,939 8,095 5.6％ 6.2％

26th 10,011 9,947 63 4,091 1,043 495 13 218 2,117 203 5,920 8,037 5.6％ 6.3％

(million yen)

1. NOI = Property leasing operating income + Depreciation 2. NOI yield is not shown for the property acquired in the 25th period. 3. Only NOI is disclosed, as FRI has not obtained the permission of the lessee to disclose other information. 4. FRI acquired an additional 50% co-ownership stake in Mitsui Shopping Park LaLaport SHIN-MISATO on August 10, 2016.

41

1. CR = Cap rate determined by the direct reduction approach 2. The values shown are for FRI’s 66% co-ownership stake. 3. Acquisition price includes the portion for the building demolished as of December 2016. The value given for book value at end of 26th period is that after the building’s demolition. 4. Based on the assumption that TSUTAYA Co., Ltd. will move out on October 27, 2017, and the fixed-term building lease contract signed with Don Quijote Co., Ltd. on March 30, 2017 (to take effect December 1,

2017).

Area Property name Acquisition

date Acquisition

price

Book value at end of

26th period

26th period (June 30, 2017)

25th period (December 31, 2016)

Changes Major factor

in increase/

decrease

Appraisal value CR1

Appraisal value CR1

Appraisal

value CR1 CR1 Other

Tokyo m

etro

polita

n a

rea

AEON Shinagawa Seaside Shopping Center Aug. 2004 20,100 15,446 19,100 5.7% 19,200 5.7% -100 0.0% ○

Kamiikedai Tokyu Store Aug. 2004 1,490 1,250 1,820 4.8% 1,780 4.9% +40 -0.1% ○

Summit Store Takinogawa Momiji-Bashi Sep. 2006 3,100 2,860 3,630 5.0% 3,560 5.1% +70 -0.1% ○

Queen’s Isetan Suginami-Momoi Jul. 2008 3,560 3,378 4,110 4.9% 4,040 5.0% +70 -0.1% ○

Mitsui Outlet Park IRUMA Jul. 2008 19,900 16,367 22,600 5.4% 22,600 5.4% 0 0.0%

Costco Wholesale Warehouse Iruma (land interest) Jul. 2008 2,600 2,626 2,750 5.4% 2,750 5.4% 0 0.0%

Desigual Harajuku Oct. 2008 3,100 2,903 3,400 3.2% 3,340 3.3% +60 -0.1% ○

Ito-Yokado Higashi-Yamato Jan. 2009 11,600 9,947 11,100 5.5% 11,100 5.5% 0 0.0%

AEON TOWN Tanashi-Shibakubo Feb. 2009 3,100 2,848 3,300 5.6% 3,240 5.7% +60 -0.1% ○

GINZA GLASSE Jul. 2010 13,600 12,953 15,100 3.0% 15,000 3.1% +100 -0.1% ○

Shimura Shopping Center Jan. 2011 4,430 4,236 5,690 4.6% 5,550 4.7% +140 -0.1% ○

Mitsui Shopping Park LaLagarden KASUKABE Feb. 2011 10,000 8,830 11,000 5.4% 11,000 5.4% 0 0.0%

Summit Store Yokohama Okano (land interest) Feb. 2012 5,700 5,945 6,630 4.7% 6,470 4.8% +160 -0.1% ○

Ikebukuro Square Feb. 2013 20,400 19,476 24,400 4.4% 24,000 4.5% +400 -0.1% ○

Kohnan Kawasaki-Odasakae Mall (land interest) Jan. 2014 7,000 7,069 8,710 4.6% 8,490 4.7% +220 -0.1% ○

Mitsui Shopping Park LaLaport SHIN-MISATO Annex Mar. 2014 3,930 3,751 3,980 5.2% 4,000 5.2% -20 0.0% ○

Mitsui Shopping Park LaLaport SHIN-MISATO2 Apr. 2015 Aug. 2016

19,840 19,648 20,300 4.8% 20,200 4.8% ＋100 0.0%

Costco Wholesale Warehouse Shin-Misato (land interest) Apr. 2015 3,810 3,854 3,950 4.4% 3,860 4.5% ＋90 -0.1% ○

Chubu AEON MALL NAGOYADOME-Mae Mar. 2006 24,800 20,966 25,200 5.2% 25,200 5.2% 0 0.0%

Mitsui Shopping Park LaLaport IWATA Jul. 2010 15,200 11,795 15,400 6.1% 15,300 6.1% +100 0.0% Kansai AEON MALL Ibaraki Aug. 2004 18,100 14,361 23,800 5.2% 23,800 5.2% 0 0.0%

Belltown Tambaguchi Eki-Mae Store Aug. 2005 2,130 1,883 2,820 5.1% 2,800 5.2% +20 -0.1% ○

QANAT Rakuhoku Jul. 2012 8,800 8,018 9,010 4.9% 9,050 5.0% -40 -0.1% ○ ○

Shinsaibashi Square Mar. 2015 8,620 8,664 9,010 3.7% 8,910 3.8% ＋100 -0.1% ○

Chugoku (Provisional name) Home Center Kohnan Hiroshima-Shi Minami-Machi (land interest)3 Apr. 2007 1,940 1,754 2,540 5.2% 2,450 5.4% +90 -0.2% ○

You Me Town Hiroshima Feb.2008 23,200 20,143 21,600 6.2% 21,600 6.2% 0 0.0%

Mitsui Shopping Park ALPARK (East Building) Feb.2013 5,400 4,998 5,520 6.4% 5,520 6.4% 0 0.0% Kyushu/ Okinawa

Papillon Plaza Aug. 2004 4,810 4,521 5,330 5.0% 5,260 5.1% +70 -0.1% ○

Frespo Tosu (land interest) Nov. 2007 3,178 3,256 3,060 6.6% 3,050 6.6% +10 0.0%

TSUTAYA BOOK STORE TENJIN4 Dec. 2009 3,700 3,343 4,180 4.3% 4,730 4.4% -550 -0.1% ○ ○

VIORO Feb. 2012 10,100 9,726 11,900 3.9% 12,000 4.0% -100 -0.1% ○ ○

KOJIMA x BIC CAMERA Naha Store Jan. 2016 1,850 1,929 2,410 5.7% 2,370 5.8% +40 -0.1% ○

Total 289,088 258,758 313,350 312,220 +1,130

Appraisal value

Unrealized gain: ¥54.5 billion (up ¥3.1 billion from 25th period)

(million yen)

42

1. CR = Cap rate determined by the direct reduction approach 2. DR = Discount rate determined by the discounted cash flow approach 3. TCR = Terminal cap rate determined by the discounted cash flow approach 4. The appraisal values are for FRI’s 66% co-ownership stake. 5. Based on the assumption that TSUTAYA Co., Ltd. will move out on October 27, 2017, and the fixed-term building lease contract signed with Don Quijote Co., Ltd. on March 30, 2017 (to take effect December 1, 2017).

Area Property name

26th period (June 30, 2017) 25th period (December 31, 2016)

Appraisal value

(million yen)

Direct

reduction

approach

Discounted cash flow approach

Appraisal value

(million yen)

Direct

reduction

approach

Discounted cash flow approach

CR1 DR2 TCR3 CR1 DR2 TCR3

Tokyo m

etro

polita

n a

rea

AEON Shinagawa Seaside Shopping Center 19,100 5.7% 5.6% 6.1% 19,200 5.7% 5.6% 6.1%

Kamiikedai Tokyu Store 1,820 4.8% 4.5% 4.9% 1,780 4.9% 4.6% 5.0%

Summit Store Takinogawa Momiji-Bashi 3,630 5.0% 4.6% 5.1% 3,560 5.1% 4.7% 5.2%

Queen’s Isetan Suginami-Momoi 4,110 4.9% 4.6% 5.0% 4,040 5.0% 4.7% 5.1%

Mitsui Outlet Park IRUMA 22,600 5.4% 5.2% 5.6% 22,600 5.4% 5.2% 5.6%

Costco Wholesale Warehouse Iruma (land interest) 2,750 5.4% 4.8% 5.7% 2,750 5.4% 4.8% 5.7%

Desigual Harajuku 3,400 3.2% 3.0% 3.4% 3,340 3.3% 3.1% 3.5%

Ito-Yokado Higashi-Yamato 11,100 5.5% 5.3% 5.7% 11,100 5.5% 5.3% 5.7%

AEON TOWN Tanashi-Shibakubo 3,300 5.6% 5.3% 5.7% 3,240 5.7% 5.4% 5.8%

GINZA GLASSE 15,100 3.0% 2.8% 3.2% 15,000 3.1% 2.9% 3.3%

Shimura Shopping Center 5,690 4.6% 4.7% 4.8% 5,550 4.7% 4.8% 4.9%

Mitsui Shopping Park LaLagarden KASUKABE 11,000 5.4% 5.2% 5.6% 11,000 5.4% 5.2% 5.6%

Summit Store Yokohama Okano (land interest) 6,630 4.7% 4.5% — 6,470 4.8% 4.6% —

Ikebukuro Square 24,400 4.4% 4.2% 4.6% 24,000 4.5% 4.3% 4.7%

Kohnan Kawasaki-Odasakae Mall (land interest) 8,710 4.6% 4.4% — 8,490 4.7% 4.5% —

Mitsui Shopping Park LaLaport SHIN-MISATO Annex 3,980 5.2% 5.0% 5.4% 4,000 5.2% 5.0% 5.4%

Mitsui Shopping Park LaLaport SHIN-MISATO4 20,300 4.8% 4.5% 4.9% 20,200 4.8% 4.5% 4.9%

Costco Wholesale Warehouse Shin-Misato (land interest) 3,950 4.4% 4.5% 4.3% 3,860 4.5% 4.6% 4.4% Chubu AEON MALL NAGOYADOME-Mae 25,200 5.2% 4.9% 5.3% 25,200 5.2% 4.9% 5.3%

Mitsui Shopping Park LaLaport IWATA 15,400 6.1% 5.9% 6.3% 15,300 6.1% 5.9% 6.3% Kansai AEON MALL Ibaraki 23,800 5.2% 5.0% 5.4% 23,800 5.2% 5.0% 5.4%

Belltown Tambaguchi Eki-Mae Store 2,820 5.1% 4.7% 5.1% 2,800 5.2% 4.8% 5.2%

QANAT Rakuhoku 9,010 4.9% 4.6% 5.0% 9,050 5.0% 4.7% 5.1%

Shinsaibashi Square 9,010 3.7% 3.5% 3.9% 8,910 3.8% 3.6% 4.0% Chugoku (Provisional name) Home Center Kohnan Hiroshima-Shi

Minami-Machi (land interest) 2,540 5.2% 4.8% — 2,450 5.4% 4.8% —

You Me Town Hiroshima 21,600 6.2% 5.9% 6.3% 21,600 6.2% 5.9% 6.3%

Mitsui Shopping Park ALPARK (East Building) 5,520 6.4% 6.2% 6.7% 5,520 6.4% 6.2% 6.7% Kyushu/ Okinawa

Papillon Plaza 5,330 5.0% 4.7% 5.1% 5,260 5.1% 4.8% 5.2%

Frespo Tosu (land interest) 3,060 6.6% 7.3% — 3,050 6.6% 7.3% —

TSUTAYA BOOK STORE TENJIN5 4,180 4.3% 4.1% 4.5% 4,730 4.4% 4.2% 4.7%

VIORO 11,900 3.9% 4.0% 4.1% 12,000 4.0% 4.1% 4.2%

KOJIMA x BIC CAMERA Naha Store 2,410 5.7% 5.5% 5.9% 2,370 5.8% 5.6% 6.0%

Appraisal value (supplement)

43

Total

amount (million yen)

Lender No. Amount

(million yen) Interest rate Drawdown

date Maturity date1 Loan period

(approximate) Remarks

Long-term borrowings2

15,500 Sumitomo Mitsui Banking Corporation

1 2,000 1.27750% 6/20/2011 6/20/2018 7.0 years

Unsecured/ Unguaranteed

2 3,000 1.16875% 2/20/2012 2/20/2020 8.0 years

3 1,000 1.01125% 8/20/2012 8/20/2020 8.0 years

4 3,000 1.15625% 2/1/2013 2/1/2023 10.0 years

5 1,500 0.60848% 5/19/2014 11/19/2020 6.5 years

6 1,000 0.28125% 8/29/2014 8/29/2017 3.0 years

7 2,000 0.27500% 7/2/2015 7/2/2019 4.0 years

8 2,000 0.16830% 6/20/2017 6/21/2021 4.0 years

13,000 Mitsubishi UFJ Trust and Banking Corporation

9 1,500 1.74007% 2/21/2011 8/21/2017 6.5 years

10 2,000 1.27750% 6/20/2011 6/20/2018 7.0 years

11 2,500 0.82000% 2/1/2013 2/1/2021 8.0 years

12 2,000 0.68500% 2/19/2015 2/19/2025 10.0 years

13 1,500 0.54400% 3/2/2015 3/4/2024 9.0 years

14 1,500 0.62000% 3/2/2015 3/3/2025 10.0 years

15 1,000 Note 3 0.88600% 7/2/2015 7/2/2027 12.0 years

16 1,000 0.46130% 3/9/2016 3/9/2028 12.0 years

10,500 Development Bank of Japan Inc. 17 2,000 1.20875% 8/19/2013 8/21/2023 10.0 years

18 1,500 1.17000% 3/17/2014 5/19/2025 11.2 years

19 2,000 0.35880% 3/9/2016 3/9/2027 11.0 years

20 1,000 0.37190% 4/19/2016 7/20/2027 11.3 years

21 4,000 0.33415% 8/9/2016 2/9/2028 11.5 years

5,800 Mizuho Bank, Ltd. 22 1,500 1.30750% 5/19/2011 5/21/2018 7.0 years

23 1,500 0.90500% 3/15/2013 3/15/2022 9.0 years

24 1,300 Note 3 0.59750% 7/22/2014 7/19/2022 8.0 years

25 1,500 0.21076% 7/19/2017 1/19/2022 4.5 years

Total amount

(million yen)

Lender No. Amount




Short-term borrowings

3,000 Mizuho Bank, Ltd. 1 3,000 0.06000% 7/19/2017 8/21/2017 1 month Unsecured/ Unguaranteed 1,000 The 77 Bank, Ltd. 2 1,000 0.06000% 7/19/2017 8/21/2017 1 month

Total short-term borrowings 4,000

Short-term borrowings

Long-term borrowings

1. Repayment method is lump-sum repayment for all borrowings.

(as of August 15, 2017)


1. Repayment method is lump-sum repayment for all borrowings. 2. All interest rates on long-term borrowings (except for those covered by note 3) are fixed rates. 3. These borrowings have been swapped into fixed rates to avoid the risk of interest rate fluctuations. The rates indicated are those at the time the rate swap contracts were formed.

Borrowings and bonds

44

Total

amount (million yen)

Lender No. Amount




Long-term borrowings2

5,700 Sumitomo Mitsui Trust Bank, Limited

26 2,200 1.04125% 12/16/2011 12/14/2018 7.0 years


27 1,500 0.27500% 7/2/2015 7/2/2019 4.0 years

28 2,000 0.30874% 11/30/2015 11/30/2021 6.0 years

4,400 Mizuho Trust & Banking Co., Ltd. 29 2,500 0.69000% 2/1/2013 2/3/2020 7.0 years

30 1,900 0.15380% 3/9/2016 3/11/2024 8.0 years

4,000 The Norinchukin Bank 31 2,000 0.77250% 7/18/2013 7/18/2019 6.0 years

32 1,000 Note 3 0.08890% 1/7/2015 1/23/2018 3.0 years

33 1,000 Note 3 0.33300% 1/7/2015 1/23/2023 8.0 years

4,000 The Bank of Fukuoka, Ltd. 34 1,000 0.47125% 2/1/2013 2/1/2018 5.0 years

35 1,000 0.33500% 11/21/2016 11/24/2026 10.0 years

36 2,000 0.42500% 2/24/2017 2/24/2027 10.0 years

3,500 The Bank of Tokyo-Mitsubishi UFJ, Ltd.

37 1,000 1.28625% 8/19/2011 8/19/2019 8.0 years

38 1,500 0.99000% 2/24/2012 2/22/2019 7.0 years

39 1,000 0.47125% 2/1/2013 2/1/2018 5.0 years

2,000 Resona Bank, Limited 40 1,000 1.20673% 6/3/2011 2/5/2018 6.7 years

41 1,000 Note 3 0.46490% 3/2/2015 3/4/2024 9.0 years

2,000 The Daishi Bank, Ltd 42 1,000 Note 3 0.04805% 2/10/2016 2/10/2023 7.0 years

43 1,000 0.29785% 8/1/2017 2/19/2025 7.5 years

2,000 The Iyo Bank, Ltd. 44 1,000 Note 3 0.61150% 4/1/2015 5/14/2025 10.1 years

45 1,000 0.09000% 11/21/2016 11/22/2021 5.0 years

2,000 The Yamaguchi Bank, Ltd. 46 1,000 0.81125% 8/18/2014 8/19/2024 10.0 years

47 1,000 0.56000% 6/19/2017 6/19/2029 12.0years

1,000 The Hiroshima Bank, Ltd. 48 1,000 Note 3 0.40250% 11/25/2014 11/25/2021 7.0 years

1,000 The Gunma Bank, Ltd. 49 1,000 Note 3 0.27100% 12/16/2014 12/16/2020 6.0 years

1,000 The Hachijuni Bank, Ltd. 50 1,000 Note 3 0.25190% 11/19/2015 5/19/2022 6.5 years

1,000 The Musashino Bank, Ltd. 51 1,000 0.45333% 3/25/2014 5/27/2019 5.2 years

1,000 The 77 Bank, Ltd. 52 1,000 0.41130% 12/22/2016 12/22/2026 10.0 years

Total long-term borrowings 79,400

Investment corporation bonds

Total amount

(million yen)

Issue No. Amount

(million yen) Interest rate Issue date Maturity date Period Remarks

Investment corporation

bonds 3,000 2nd Investment corporation bonds 1 3,000 0.708% 11/25/2016 11/25/2031 15.0 years


Total Investment corporation bonds 3,000

Borrowings and bonds


1. Repayment method is lump-sum repayment for all borrowings. 2. All interest rates on long-term borrowings (except for those covered by note 3) are fixed rates. 3. These borrowings have been swapped into fixed rates to avoid the risk of interest rate fluctuations. The rates indicated are those at the time the rate swap contracts were formed.


45

FRI maintains top-level ratings among J-REITs, making its investment units eligible for purchase by the Bank of Japan.

Ratings and indices

Rating Firm Category Rating Outlook

JCR Long-term issuer AA Stable

R&I Issuer AA- Stable

S&P

Long-term Ａ+ Stable

Short-term Ａ-1 Stable

Inclusion in global REIT indices Ratings

Indices

FTSE EPRA/NAREIT Global Real Estate Index

Dow Jones Global Select REIT Index

S&P Global REIT Index/S&P Developed REIT Index

GPR 250 Index/GPR 250 REIT Index

(as of June 30, 2017)

46

0億円

10億円

20億円

2017年 2019年 2021年 2023年 2025年 2027年

Within 5 years

29.5%

Over 5 years, up

to 10 years

30.4%

Over 10 years,

up to 15 years

15.1%

Over 15 years,

up to 20 years

21.2%

(As of June 30, 2017)

Average remaining years until full repayment of leasehold and security deposits: 9.1 years

Over 20 years

3.8%

(百万円)

2016 2015 2014 2013 2012 2017

1,011 508 1,011 516 1,003 516 1,003 1,637 763 276 779

92

96

92

83

32

114

122

33

87

125

198

411

657

992

1,636

1,161

1,608

712 879

1,072

487

1,306

1,715

1,089

0

500

1,000

1,500

2,000

第17期第18期第19期第20期第21期第22期第23期第24期第25期第26期第27期 (予想)

Leasehold and security deposits and depreciation

2.0

1.0

0

(billion yen)

2017 2019 2021 2023 2025 2027

Repayment ends at You Me Town

Hiroshima

Repayment starts at You Me Town

Hiroshima Repayment ends at AEON Shinagawa

Repayment ends at NAGOYADOME-Mae

Remaining period until full repayment

Leasehold and security deposit features

Schedule of security deposit repayment

Since FRI contracts long-term leases, it can use leasehold and security deposits to procure significant long-term funding.

Since FRI holds many security deposits at zero interest, these deposits provide a source of low-cost funding.

Utilizing depreciation

Utilizing capital equivalent to each period’s depreciation enables aggressive strategic investment in addition to the repayment of security deposits.

AEON MALL Ibaraki 2015


2014

Large-scale renovations

*The disposition of AEON Hadano Shopping Center was completed on November 28, 2014.

AEON Hadano Shopping Center*

2011

17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th

(forecast)

(million yen)

Over 10 years: Approx. 40%

Over 5 years: Approx. 70%

■ Property acquisition, etc. ■ Large-scale

renovations ■ Ordinary capital expenditure ■ Return of security

deposits

47

9,231

8,539 8,499 8,909

9,695

8,896 9,468

10,022 216

451 112

435

1742 1,456

1,208 686

9,405

10,211

9,707

9,360

9,695 9,694 9,903

10,022

7,000

8,000

9,000

10,000

11,000

Stable distribution management

＊1

-947

0

Property acquisition (24th) ・KOJIMA x BIC CAMERA

Naha Store Acquisition price: ¥1,850 million

Property sale (24th) ・Joyfultown Okayama Sale price: ¥8,685 million Loss on sale: ¥469 million

Property acquisition (25th) ・LaLaport SHIN-MISATO

(50% co-ownership) Acquisition price:

¥15,100 million

Property acquisitions (22nd) ・Shinsaibashi Square


・LaLaport SHIN-MISATO

(16% co-ownership) Acquisition price: ¥4,740 million

・Costco Wholesale Warehouse Shin-Misato

(land interest) Acquisition price: ¥3,810 million

Property sale ・AEON Hadano Shopping Center Sold 55% Sold 25% Sold 20% (19th) (20th) (21st)

Sale price: ¥11,800 million Gain on sale: ¥3,800 million

Property sale (19th) ・WV Sakae Sale price: ¥5,200 million Loss on sale: ¥1,957 million

Property acquisitions (20th) ・Kohnan Kawasaki (land interest)


・LaLaport SHIN-MISATO

Annex Acquisition price: ¥3,930 million

At end of 18th fiscal period

¥271.6 bn At end of 26th fiscal period

¥289.0 bn

Asset size Total sales3 ¥25.6 bn

Total acquisitions3 ¥45.0 bn

1.Distribution of gain on property sales = (gain on property sales – portion put toward internal reserves) / number of units issued and outstanding 2.The gain on property sales presented for the 19th fiscal period is the net total of the gain on sale of AEON Hadano Shopping Center and loss on sale of WV Sakae. 3.Total sales and total acquisitions are the totals of the prices paid and received for properties acquired and sold, respectively. These figures do not account for the full difference in

asset size.

19th 20th 21st 22nd 23rd 24th 25th 26th

■ Distribution of rent business revenue

■ Distribution through new

property acquisitions ■ Distribution of gain on

property sales1 ■ Distribution of reversal of

reserve for reduction entry ■ Impact on distributions of

loss on property sales

Breakdown of distribution per unit

(yen)

48

Growth cycle and property acquisitions

公募増資

一口当たり

分配金(

円)

資産規模(

取得価格ベース)

LTV

スポンサーからの取得

スポンサー外からの取得

50.0%

40.0%

¥9,000

資産規模(億円)

第1期

（04/12期）

第2期

（05/6期）

第3期

（05/12期）

第4期

（06/6期）

第5期

（06/12期）

第6期

（07/6期）

第7期

（07/12期）

第8期

（08/6期）

第9期

（08/12期）

第10期

（09/6期）

第11期

（09/12期）

第12期

（10/6期）

第13期

（10/12期）

第14期

（11/6期）

第15期

（11/12期）

第16期

（12/6期）

第17期

（12/12期）

第18期

（13/6期）

第19期

（13/12期）

第20期

（14/6期）

第21期

（14/12期）

第22期

（15/6期）

第23期

（15/12期）

第24期

（16/6期）

第25期

（16/12期）

第26期

（17/6期）

第27期(予想)

（17/12期）

2,739 1,231 1,596 1,743 1,780 2,068 2,212 2,458 2,716 2,370 1,780 2,212 2,592 2,678

Property sales

2,659 2,831 648 648 669 917 967 999 948 2,831

Property sale

2,934 2,890

Approx. 42%

2,890

Public

offe

rings

Distrib

utio

n

per u

nit (y

en)

Ass

et siz

e

(acquisitio

n p

rice b

asis)

LTV

Sponsor

1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st 22nd 23rd 24th 25th 26th 27th Forecast**

Dec.‘04 Jun.’05 Dec.‘05 Jun.’06 Dec.’06 Jun.’07 Dec.’07 Jun.’08 Dec.‘08 Jun.’09 Dec.’09 Jun.’10 Dec.’10 Jun.’11 Dec.’11 Jun.’12 Dec.’12 Jun.‘13 Dec.’13 Jun. ’14 Dec.‘14 Jun.‘15 Dec.’15 Jun.’16 Dec. ‘16 Jun.‘17 Dec.’17

Japan Tobacco March 2008 onward: Mitsui Fudosan

July 2010 July 2012 July 2008

March 2008 Third-party allotment

March 2013

Sound, careful control of LTV

Track record of stable distributions

Seeking to grow FRI’s asset size to maintain and improve the stability of the earnings base

Asset size (billion yen)

Acquisitions from the sponsor

Acquisitions not from the sponsor

9.3% 8.3%

14.3%

34.0% 35.2% 35.9% 37.5%

41.0% 41.0% 45.5% 46.2% 45.7%

43.6% 46.8% 46.3%

49.6%

42.5% 41.0%

37.6% 39.2% 38.0%

41.7% 41.2% 39.1% 42.3% 41.6%

*FRI implemented a two-for-one split of its investment units effective January 1, 2014. Distributions before the split have been divided by two and truncated to the nearest yen.

** Distribution per unit (DPU), LTV and asset size forecasts for the 27th period are given as the figures announced in “Summary of Financial Results for the 26th Fiscal Period,” published August 15, 2017.

4,771 5,622

6,045

7,218

8,648 8,846 8,922 8,980 9,205 9,274 9,368 9,294 9,097 9,239 9,299

9,991 9,191 9,173 9,405

10,211 9,707 9,360 9,695 9,694 9,903 10,022 10,080

49

26,060 26,060 29,160

57,960 67,960

76,760

102,560 106,490 123,660

138,760

3,100

28,800

10,000

8,800

25,800

3,930

17,170

15,100

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

2008年6/12期 2009年6/12期 2010年6/12期 2011年6/12期 2012年6/12期 2013年6/12期 2014年6/12期 2015年6/12期 2016年6/12期 2017年6/12期

Assets acquired from the sponsor (Mitsui Fudosan)

Properties acquired from Mitsui Fudosan

Average annual acquisition price: ¥15,418 million

Non-sponsor 17.7%

Japan Tobacco 35.1%

Mitsui Fudosan, etc. 47.3%

Acquisition resources

Cumulative assets acquired from Mitsui Fudosan, etc.

Steady track record of property acquisitions via the sponsorʼs robust pipeline


Annex ¥3.9 billion


¥3.5 billion


¥3.1 billion

GINZA GLASSE ¥13.6 billion

Mitsui Shopping Park LaLagarden

KASUKABE ¥10.0 billion

QANAT Rakuhoku ¥8.8 billion

Ikebukuro Square ¥20.4 billion

Shinsaibashi Square ¥8.6 billion

Mitsui Shopping Park LaLaport

SHIN-MISATO (50%) ¥15.1 billion


¥19.9 billion


¥15.2 billion


¥5.4 billion

Mitsui Shopping Park LaLaport SHIN-MISATO (16%)

¥4.7 billion

Costco Wholesale Warehouse

Iruma (land interest) ¥2.6 billion

Costco Wholesale Warehouse Shinｍisato (land interest)

¥3.8 billion

(million yen)

8th/9th 10th/11th 12th/13th 14th/15th 16th/17th 18th/19th 20th/21st 22nd/23rd 24th/25th 26th

Total acquisition

price: ¥293.4 billion

10 properties

¥102.8 bn

9 properties

¥51.8 bn

14 proper-

ties

¥138.7 bn

(As of Aug. 15, 2017)

50

Mitsui Fudosanʼs retail facility development

Total: Approx.

¥873.5 billion

Retail facilities in operation 14%

Planned & under development 45%

Office buildings in operation 20%

Rental housing in operation 6%

Logistics facilities in operation 8%

As of March 31, 2016

Opening year Project name Location

2014

LaLaterrace Musashikosugi Kawasaki City, Kanagawa

Mitsui Outlet Park Sapporo Kita Hiroshima (Phase 2) Kitahiroshima City, Hokkaido

Mitsui Outlet Park Kisarazu (Phase 2) Kisarazu City, Chiba

LaLaport Kashiwanoha (north building) Kashiwa City, Chiba

Akarenga TERRACE Sapporo City, Hokkaido

Iidabashi Sakura Terrace Chiyoda City, Tokyo

LaLaport Izumi Izumi City, Osaka

Shin Kawasaki Square Kawasaki City Kanagawa

2015

LaLaport Fujimi Fujimi City, Saitama

Mitsui Outlet Park Kuala Lumpur International Airport Sepang (Phase 1)

Selangor, Malaysia

Mitsui Outlet Park Hokuriku Oyabe Oyabe City, Toyama

Mitsui Outlet Park Makuhari (Phase 3) Chiba City, Chiba

LaLaport Ebina Ebina City, Kanagawa

LaLaport EXPOCITY Suita City, Osaka

Mitsui Outlet Park LINKOU New Taipei, Taiwan

2016 LaLaport SHONAN HIRATSUKA Hiratsuka City, Kanagawa

2017

MITSUI OUTLET PARK JAZZ DREAM NAGASHIMA (Phase 5)

Kuwana City, Mie


Selangor, Malaysia

2018 Nagoya City Komei Project Nagoya City, Aichi

Mitsui Outlet Park Taichung Port Taichung, Taiwan

2021


Selangor, Malaysia

LaLaport Kuala Lumpur Kuala Lumpur, Malaysia

TBD Retail Facility Development Project in Togocho, Aichi Aichi-gun, Aichi

Miyashita Park Project Shibuya City, Tokyo

Overseas rental assets in operation 8%

Main retail facility projects under development Breakdown of Mitsui Fudosanʼs inventory of property for

sale to investors

REIT sponsored by the Mitsui Fudosan Group, etc.

Property sales to various investors

Institutional investors, corporations, etc.

Buyers commission property management

Mitsui Fudosan’s model for joint value creation with investors

Prepared from data in Mitsui Fudosan’s “Investor Presentation March 2017”

Prepared from data in Mitsui Fudosan’s “Investor Presentation March 2017”

51

Mitsui Fudosanʼs retail facility operation

Mitsui Fudosanʼs retail facility operation

Takeshita-dori Square LaLaport SHONAN HIRATSUKA LaLaport FUJIMI

COREDO Muromachi Tokyo Midtown

Source: Mitsui Fudosan. As of April 1, 2017. Includes properties operated and managed on a consignment basis.

Number of facilities 109

Total floor space Approx. 5,200,000 m2

Leased floor space Approx. 2,900,000 m2

Tenant stores Approx. 7,600

Tenant companies Approx. 2,300

Mitsui Fudosan owns and operates retail facilities across Japan, mainly in the Tokyo metropolitan and Kansai areas

(million yen)

Rental revenue of Mitsui Fudosan’s retail facilities (non-consolidated)

Source: Fact books for the years ended March 31, 2002-2017, Mitsui Fudosan

34,657 36,935 37,601 45,947 51,716

62,091

87,393 103,191

118,823 123,114

129,235 148,025

157,716 169,894

201,371 215,221

0

50,000

100,000

150,000

200,000

250,000

2002年

3月期

2003年

3月期

2004年

3月期

2005年

3月期

2006年

3月期

2007年

3月期

2008年

3月期

2009年

3月期

2010年

3月期

2011年

3月期

2012年

3月期

2013年

3月期

2014年

3月期

2015年

3月期

2016年

3月期

2017年

3月期 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

● Regional SC ● Mitsui Outlet Park ● Urban retail facilities ● Other

Hokkaido

Tohoku

Tokyo metropolitan area Chubu

Kansai

Chugoku

Kyushu

52

Utilizing the support of the sponsor

Frontier REIT SC Management Co., Ltd.

Asset custodianship Preventive maintenance of buildings/facilities, approval of construction by tenants, emergency response, etc.

Operation and management Management company supervision, reporting on operations/management

Accounting support

Retail facility operation/management

Specialized in the operation and management of properties owned by FRI

Support for external growth

• Rich property pipeline

• Provides brokerage and information regarding properties from third parties

Support for internal growth

• Operation/management using the Mitsui Fudosan Group’s expertise

• Provides information on the retail market and tenant leasing

Asset Management Company

Comprehensive developer

53

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

2004/08 2005/08 2006/08 2007/08 2008/08 2009/08 2010/08 2011/08 2012/08 2013/08 2014/08 2015/08 2016/08

出来高（右軸）

FRI投資口価格（左軸）

Investment unit price

Average trading volume Price at end of 26th period

918 463,500

(26th period) (June 30, 2017)

＊FRI投資口価格はIPO価格を100%とする。＊東証REIT指数は2004年8月9日の終値を100%とする。

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

220%

240%

2004/08 2005/08 2006/08 2007/08 2008/08 2009/08 2010/08 2011/08 2012/08 2013/08 2014/08 2015/08 2016/08

FRI投資口価格（左軸）東証REIT指数（左軸）配当利回り(右軸、次期予想ベース）

Price comparison (Aug. 9, 2004 – Jun. 30, 2017)

Investment unit price (Aug. 9, 2004 – Jun. 30, 2017)

FRI unit price (left axis)

Volume (right axis)

(yen)

Source: QUICK

(units)

Source: QUICK

* FRI implemented a two-for-one split of its investment units effective January 1, 2014. Accordingly, unit prices before December 25, 2013, have been divided by two.

FRI unit price (left axis) Distribution yield (right axis) TSE REIT Index (left axis)

*For FRI unit price, the price upon IPO has been set at 100% *For TSE REIT Index, the closing value of August 9, 2004 has been set at 100%

54

28.7%

25.7%

25.5%

25.5%

26.5%

26.8%

25.5%

28.1%

26.4%

28.1%

37.8%

40.8%

45.8%

46.8%

44.3%

47.2%

46.0%

43.2%

45.0%

44.1%

9.4%

8.4%

7.3%

6.7%

7.0%

6.5%

6.9%

6.6%

6.5%

6.7%

9.2%

9.4%

8.6%

8.8%

8.8%

8.6%

8.7%

8.6%

8.5%

8.2%

14.9%

15.8%

12.7%

12.2%

13.5%

10.8%

12.9%

13.5%

13.5%

12.9%

0% 20% 40% 60% 80% 100%

第17期

(12/12月)

第18期

(13/6月)

第19期

(13/12月)

第20期

(14/6月)

第21期

(14/12月)

第22期

(15/6月)

第23期

（15/12期）

第24期

（16/6期）

第25期

（16/12期）

第26期

（17/6期）

金融機関投信等個人・その他その他の国内法人外国法人等

Unitholders

Name Units held

Proportion

Japan Trustee Services Bank, Ltd. (Trust Account) 114,258 23.0 %

The Master Trust Bank of Japan, Ltd. (Trust Account) 48,152 9.7 %

Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account)

31,951 6.4 %

Mitsui Fudosan Co., Ltd. 29,200 5.9 %

The Nomura Trust and Banking Co., Ltd. (Investment Trust Account) 20,188 4.1 %

The Yamanashi Chuo Bank, Ltd. 9,543 1.9 %

State Street Bank-West Pension Fund Clients-Exempt 505233

7,044 1.4 %

The Chugoku Bank, Limited 6,275 1.3 %

State Street Bank and Trust Company 505223 6,141 1.2 %

Trust & Custody Services Bank, Ltd. (Money Trust Tax Account) 6,138 1.2 %

Total 278,890 56.2%

* All as of June 30, 2017

Financial

institutions* Individuals,

other

Other domestic

corporations

Overseas corporations and others

Total

26th period (June 2017)

183 7,713 190 206 8,292

25th period (Dec. 2016)

178 7,623 192 213 8,206

Change +5 +90 -2 -7 +86

Units held by unitholder type Unitholders by type

Principal unitholders* (top 10)

26th 6/17

25th 12/16

24th 6/16

23rd 12/15

22nd 6/15

21st 12/14

20th 6/14

19th 12/13

18th 6/13

17th 12/12

*Includes mutual funds, etc.

■Financial institutions ■Mutual funds, etc. ■Individuals, other

■Other domestic corporations ■Overseas corporations and others

Asset Management Company

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