For a Superior Level of Living Comfort

S e m i - A n n u a l R e p o r t

for the 14th Fiscal PeriodFrom February 1, 2017 to July 31, 2017

For a Superior Level of Living Comfort

1-1 Minami-Aoyama 1-chome, Minato-ku, Tokyo http://www.comforia-reit.co.jp/english/

S e m i - A n n u a l R e p o r t

for the 14th Fiscal PeriodFrom February 1, 2017 to July 31, 2017


COMFORIA is the name we have given to the urban rental residences produced by the Tokyu Land Corporation. The word COMFORIA is a compound that

we coined from “comfort,” and “ia,” a Latin suffix meaning “place.”

The idea that residences are not just containers has given birth to our “COMFORIA” series of rental residences made specifically for people

who wish to live freely and affluently in urban communities.

We invest in and manage the urban exclusive rental residence “COMFORIA” series, which Tokyu Land Corporation has produced, to maximize our unitholders’ value.


We are pleased to inform you that Comforia Residential REIT, Inc (the “Invest-ment Corporation”) successfully closed all accounts for the 14th Fiscal Period (from February 1, 2017 to July 31, 2017). We would like to thank all of our unit-holders and stakeholders for their continued support and cooperation.

We hereby report on the asset management overview and results for the 14th Fiscal Period.

During the 14th Fiscal Period, the Investment Corporation newly acquired eight properties centering on sponsor-developed properties (five properties in the Tokyo 23 wards, three properties in other major cities) through a fourth public offering conducted in February 2017 for the fourth consecutive year since list-ing, in addition to borrowings, and additionally acquired COMFORIA GYOTOKU in June 2017 through borrowings. Consequently, our asset size as of the end of the 14th Fiscal Period totaled 110 properties with a total acquisition price of ¥187.4 billion. The average occupancy rate remained high at 96.2%. The Invest-ment Corporation achieved ¥7,276 million in operating revenue, ¥3,098 million in operating profit, and ¥2,608 million in profit, all of which exceeded our fore-casts, resulting in a distribution per unit of ¥4,681.

Furthermore, after the end of the 14th Fiscal Period, we acquired an additional property, COMFORIA SHIBAURA, in August 2017 through borrowings. As a result, our portfolio as of September 30, 2017 stood at 111 properties, with a total acquisi-tion price of ¥188.5 billion. We will continue to aim to achieve stable earnings and ensure the steady growth of our man-aged assets based on medium- and long-term perspectives to maximize unitholder value. Your continued support and cooperation are highly appreciated.

Ⅰ. Overview of the Investment Corporation

Greetings/Financial Highlights 1

Top Interview 2

Selective Investments through Diversified Property Acquisition Channels 6

Internal Growth Strategy 8

Financial Strategy 9

Portfolio Map 10

Portfolio List 12

Basic Policies 17

Overview of the Investment Corporation and Asset Management Company 18

Ⅱ. Asset Management Report 21

Ⅲ. Financial Section Balance Sheets 46

Statements of Income 48

Statements of Changes in Unitholders’ Equity 49

Statements of Cash Distributions 50

Statements of Cash Flows 51

Notes 52

Supplementary Schedules 61

Independent Auditor’s Report 67

Contents

Operating revenue ¥7,276 million Number of properties 110 properties

Operating profit ¥3,098 million Acquisition price ¥187.4 billion

Profit ¥2,608 million Appraisal value ¥218.8 billion

Distribution per unit ¥4,681 Occupancy rate at the 14th Fiscal Period-end 96.1 %

Total loan to value (LTV) 50.5 % Average occupancy rate 96.2 %

Ⅰ. Overview of the Investment Corporation

Greetings

Financial Highlights

1

Comforia Residential REIT, Inc

Takehiro Izawa

Executive Director (center)

Yoshihiro KataokaSupervisory Director (left)

Koji YamamotoSupervisory Director (right)

TOP INTERVIEW

About Executive Director In line with the reorganization of the Asset Management Company carried out on April 1, 2017, I was appointed Ex-ecutive Director of Comforia Residential REIT, Inc (herein-after referred to as the “Investment Corporation”). As I am determined to exert every possible effort on the manage-ment of the Investment Corporation, as my predecessor Hiroyuki Tomata has, I would appreciate your continued support and guidance.

About Reorganization of the Asset Management Company In order to foster sophisticated asset management opera-tions and expand opportunities for acquiring properties with an aim to enhance unitholder value, TLC REIT Man-agement Inc. (“the Asset Management Company”), to which the Investment Corporation entrusts its asset man-agement operations, conducted, on April 1, 2017, an ab-sorption-type merger with TLC Comforia Investment Man-agement INC. as the surviving company and TLC Activia Investment Management Inc. as the absorbed company. TLC REIT Management Inc. also conducted an absorption-type split with Tokyu Land Capital Management Inc. as the absorption-split company and TLC Comforia Investment Management INC. as the absorption-type split succeeding company (hereinafter referred to as the “Reorganization”), and changed the trade name of TLC Comforia Investment Management INC. to TLC REIT Management, Inc. Hiroyuki Tomata has remained as President & CEO of the Asset Management Company after the reorganization.

About Investment Policy We have made selective investments in high-quality properties mainly in the Tokyo 23 wards based on our ba-sic policies of “investments in residential properties with stable earnings and high growth potential” and “utiliza-tion of the Tokyu Fudosan Holdings Group.” Since stable demand for rental residences is expected to continue due to the inflow of the younger demographic and increase in singles and small families, we believe that making selec-

tive investments in high-quality properties with better convenience located in high-demand areas will lead to long-term stability and growth of earnings.

On the asset management front, we aim for stable occu-pancy through improved resident satisfaction by offering not only convenience but also utilizing various services of Tokyu Fudosan Holdings Group, under the brand concept of “For a Superior Level of Living Comfort.”

About Public Offering With an aim to expand our asset size and to further im-prove stability of earnings from the portfolio, we acquired eight properties centering on sponsor-developed proper-ties (five properties in the Tokyo 23 wards, three proper-ties in other major cities) using funds of ¥11.8 billion pro-cured through a public offering conducted for the fourth consecutive year since listing and borrowings in February 2017. Furthermore, we additionally acquired COMFORIA GYOTOKU in June 2017 through borrowings, expanding the asset size to ¥187.4 billion.

With eight of the nine properties acquired during the 14th Fiscal Period being from the sponsor, we have real-ized growth through full utilization of the sponsor group’s support.

Overview of Public Offering We conducted a public offering with January 19 and 20, 2017 as subscription period and February 1, 2017 as pay-ment date. In addition, we acquired COMFORIA AKIHABA-RA EAST and seven other properties on February 2, 2017.

Address1-15-1 Kamitakaido, Suginami-ku, Tokyo

Nearest station/ Distance (on foot)

5-minute walk from Hachimanyama Station on the Keio Line

Ownership Ownership

Completion date Mar. 2015

Rentable units 73 units

Acquisition date Feb. 2, 2017

Acquisition price ¥1,245,000 thousand

Appraisal NOI yield

4.6% (as of Oct. 31, 2016)

Address 4-21-2 Kamata, Ota-ku, Tokyo


3-minute walk from Keikyu Kamata Station on the Keikyu Main Line6-minute walk from Kamata Station on the JR Keihin-Tohoku Line

Ownership Ownership

Completion date Aug. 2015

Rentable units203 units (including 2 retail sections)



Appraisal NOI yield

4.5% (as of Oct. 31, 2016)

Address1-3-2 Honkomagome, Bunkyo-ku, Tokyo


3-minute walk from Hakusan Station on the Toei Mita Line

Ownership Ownership

Completion date Aug. 2006




Appraisal NOI yield

4.5% (as of Oct. 31, 2016)

COMFORIA BUNKYOHAKUSAN106 Sub-central Tokyo COMFORIA KAMATA107 Sub-central Tokyo

COLLEGE COURT HACHIMANYAMA108 Sub-central Tokyo

Address2-9-19 Higashikanda, Chiyoda-ku, Tokyo


10-minute walk from Akihabara Station on the JR Yamanote Line and 4 other lines6-minute walk from Asakusabashi Station on the JR Chuo Sobu Local Line and 1 other line

Ownership Ownership

Completion date Feb. 2016




Appraisal NOI yield

4.4% (as of Oct. 31, 2016)

Address 3-43-6 Shiba, Minato-ku, Tokyo


7-minute walk from Mita Station on the Toei Mita Line and 1 other line

Ownership Ownership

Completion date Feb. 2007



Acquisition price ¥890,000 thousand

Appraisal NOI yield

4.5% (as of Oct. 31, 2016)

Address1-5-5 Enokojima, Nishi-ku, Osaka-shi, Osaka


2-minute walk from Awaza Station on the Osaka Municipal Subway Chuo Line and 1 other line

Ownership Ownership

Completion date Jan. 2016




Appraisal NOI yield

4.9% (as of Oct. 31, 2016)

Address1-16-14 Kyomachibori, Nishi-ku, Osaka-shi, Osaka


7-minute walk from Higobashi Station on the Osaka Municipal Subway Yotsubashi Line9-minute walk from Hommachi Station on the Osaka Municipal Subway Midosuji Line and 2 other lines

Ownership OwnershipCompletion date Jul. 2015Rentable units 84 unitsAcquisition date Feb. 2, 2017Acquisition price ¥1,567,000 thousandAppraisal NOI yield

4.8% (as of Oct. 31, 2016)

Address2-6-8 Bakuromachi, Chuo-ku, Osaka-shi, Osaka


5-minute walk from Shinsaibashi Station on the Osaka Municipal Subway Midosuji Line and 1 other line

Ownership Ownership

Completion date Jan. 2016




Appraisal NOI yield

4.8% (as of Oct. 31, 2016)

COMFORIA SHINSAIBASHI EAST109 Other major cities

COMFORIA AWAZA111 Other major citiesCOMFORIA KYOMACHIBORI110 Other major cities

COMFORIA AKIHABARA EAST Central Tokyo104

Sponsor-developed

Sponsor-developed properties

WarehousingWarehousing properties by sponsors

Warehousing

Warehousing

Warehousing

Sponsor-developed

Sponsor-developed

Sponsor-developed

Sponsor-developed

Sponsor-developed

COMFORIA MITA TROIS105 Central Tokyo

We aim to maximize unitholder value by

making selective investments in high-quality

properties mainly in the Tokyo 23 wards and

utilizing the Tokyu Fudosan Holdings Group.

Takehiro IzawaExecutive Director, Comforia Residential REIT, Inc

Properties Acquired in 14th Fiscal Period (Through public offering)

Note: Total issue value and Number of investment units issued include those of third-party allotment conducted on February 22, 2017 (payment date).

Issuance resolution date January 5Payment date February 1Delivery date February 2Total issue value ¥11,814 millionNumber of investment units issued 50,190 units

2 3

TOP INTERVIEW

COMFORIA SHIBAURA

113

Maruetsu Petit Shiba 4-chome StoreMaruetsu Petit Shiba 4-chome Store

Toei Subway

Asakusa LineToei Subway

Asakusa Line

Yamanote Line

Yamanote Line

Minato-ku Sports CenterMinato-ku Sports Center

Yokosuka Line

Yokosuka Line

Tokyo Port BowlTokyo Port Bowl

Tokyo Monorail

Tokyo Monorail

Peacock Store Shibaura Island StorePeacock Store Shibaura Island Store

Kaigan-dori Street

Kaigan-dori Street

Seven ElevenSeven Eleven

Kyu-Kaigan-dori Street

Kyu-Kaigan-dori Street

Futo ParkFuto Park

JR Tamachi

StationJR Tamachi

Station

Mita Station

Mita Station

Mita

Stat

ion

Mita

Stat

ion

Shibaura Institute of TechnologyShibaura Institute of Technology

Minato Shibaura YonPost Office

Minato Shibaura YonPost Office

COMFORIA GYOTOKU

112Ando HospitalAndo Hospital

Seven ElevenSeven Eleven

Katori Nursery SchoolKatori Nursery School Gyotoku Ekimae ParkGyotoku Ekimae Park

The Bank of Tokyo-Mitsubishi UFJThe Bank of Tokyo-Mitsubishi UFJ

Minamine ParkMinamine Park

Gyotoku Ekimae San Post OfficeGyotoku Ekimae San Post Office

LawsonLawson

Municipal Dainana Junior High School Municipal Dainana Junior High School

Niihama Elementary SchoolNiihama Elementary School

Minami Fire StationMinami Fire Station

Seiyu Gyotoku StoreSeiyu Gyotoku Store Tokyo Metro Tozai Line

Tokyo Metro Tozai LineKy

u-edo

gawa R

iver

Kyu-e

doga

wa Rive

r

Gyotoku Station

Gyotoku Station Tokyo

23 Wards

90.5%

Other major cities

7.0％

Central Tokyo

44.9％

Sub-central Tokyo

45.6％

Tokyo Metropolitan area

2.5％

Over 10 mins

3.1％

5 to 10 mins

36.0％ Under 5 mins

60.9％

Average Distance

4.9 minutes

Single

49.1％

Compact

39.8％

Family 10.4％

Large 0.3％ Stores 0.4％

Single/Compact

88.8%

Under 3 years

11.2％3 to 5 years

2.2％

5 to 10 years

38.5％

Over 10 years

48.0％

Average Building age

9.3 years

Address 2-1-13 Gyotokuekimae, Ichikawa-shi, Chiba


2-minute walk from Gyotoku Station on the Tokyo Metro Tozai Line

Ownership Ownership

Completion date Mar. 2007


Acquisition date Jun. 1, 2017

Acquisition price ¥978,000 thousand

Appraisal NOI yield 4.9% (as of Apr. 30, 2017)

COMFORIA GYOTOKU112 Tokyo metropolitan area

Address 2-3-33 Shibaura, Minato-ku, Tokyo


8-minute walk from Shibaura Futo Station on the Yurikamome Line10-minute walk from Tamachi Station on the JR Yamanote and Keihin Tohoku Lines

Ownership Ownership

Completion date Nov. 2008


Acquisition date Aug. 1, 2017


Appraisal NOI yield 4.5% (as of Jun. 30, 2017)

COMFORIA SHIBAURA113 Central Tokyo

Portfolio Summary (After acquisition of assets in the 15th Fiscal Period) Property Acquired in 14th Fiscal Period

Property Acquired in 15th Fiscal PeriodUnit Type Building Age

Investment Area Minutes to Nearest Station (on foot)

Future Growth StrategyWe will work to further enhance COMFORIA’s brand power as well as steadily expand the portfolio towards our mid-term goal of achieving an asset size of ¥200 billion, while seeking stable distribution in collaboration with the sponsor to improve unitholder value.

We will continue to invest selectively in high-quality prop-erties utilizing the sponsor’s information development capabilities, along with the original sourcing by the Asset Management Company.

Furthermore, we will prove various “superior levels” by pursuing services for the residents.

We will continue to strive to secure stable earnings from the portfolio and to maintain and enhance asset value based on our basic asset management policies of “selec-tive investments in high-quality properties mainly in the Tokyo 23 wards” and “utilization of the Tokyu Fudosan Holdings Group” going forward.

Joined Tokyu Land Corporation in April 1991. After en-

gaging in housing business, led the listing of an affiliate

subsidiary, and acquisition/management of properties for

REITs/funds. In September 2013, appointed General Man-

ager of Investment Operation Department of TLC Comforia

Investment Management INC. (currently TLC REIT Manage-

ment, Inc.). In April 2017, assumed the offices of Executive

Director, Chief Division Officer of Comforia Management

Division of TLC REIT Management Inc. and Executive Direc-

tor of Comforia Residential REIT, Inc.

Profile

Takehiro Izawa, Executive DirectorComforia Residential REIT, Inc

4 5

0

100

150

200(Billions of yen)

Tokyo 23 wards

96.3％Listed

(Feb. 6, 2013)

Tokyo 23 wards

96.3％“End of 7th Fiscal Period”

Ended Jan. 2014

“End of 6th Fiscal Period”

Ended Jul. 2013

Tokyo 23 wards

93.3％

Tokyo 23 wards

92.5％


Ended Jul. 2014


Ended Jan. 2015

Tokyo 23 wards

92.9％71.271.2 74.5

116.2122.8

146.5 146.7

164.4168.0

“End of 10thFiscal Period”

Ended Jul. 2015


Ended Jan. 2016


Ended Jul. 2016


Ended Jan. 2017


Ended Jul. 2017

Aug. 2017

Tokyo 23 wards

94.0％

Tokyo 23 wards

93.6％

Tokyo 23 wards

94.3％

Tokyo 23 wards

92.8％

Tokyo 23 wards

More than

90.0％

Future strategy

187.4187.4

Tokyo 23 wards

90.5％

Tokyo 23 wards

90.5％

188.5

倍

Acquired COMFORIA SHINJUKU EASTSIDE TOWER and three other properties

Acquired COMFORIA KANDAJINBOCHO and

11 other properties

■ Selective Investments Mainly in Tokyo 23 Wards with Aim to Achieve Asset Size of ¥200 Billion

Acquired COMFORIA KUDAN and

24 other properties

Acquired COMFORIA KOMABA and

one other property

Property development by Tokyu Land Corporation Rental residence Operational rental residence（No specific plan has been made by the Investment Corporation to acquire any of the above properties.）

■ Property Development by Tokyu Land Corporation (As of September 19, 2017)

There are 16 sponsor pipeline projects (1,864 units) in Tokyo 23 Wards and Osaka.

Acquired COMFORIA ICHIGAYAYAKUOJI and

two other properties

Acquired COMFORIA AKIHABARA EAST and eight other properties

Replacement of assets

Chiyoda-kuChiyoda-ku

Chuo-kuChuo-ku

Minato-kuMinato-ku

Shinjuku-kuShinjuku-ku

Bunkyo-kuBunkyo-ku Taito-kuTaito-ku

Sumida-kuSumida-ku

Koto-kuKoto-ku

Shinagawa-kuShinagawa-kuMeguro-kuMeguro-ku

Ota-kuOta-ku

Setagaya-kuSetagaya-ku

Shibuya-kuShibuya-ku

Nakano-kuNakano-ku

Toshima-kuToshima-ku

Itabashi-kuItabashi-ku

Arakawa-kuArakawa-ku

Suginami-kuSuginami-ku

Kita-kuKita-ku

TokyoTokyo

UenoUeno

ShinagawaShinagawa

ShibuyaShibuya

ShinjukuShinjuku

IkebukuroIkebukuro

12 properties

1,356 units

Tokyo 23 wards

Nishi-kuNishi-ku

Kita-kuKita-ku

Higashi-Yodogawa-ku

Higashi-Yodogawa-ku

Suita-shiSuita-shi

Chuo-kuChuo-ku

ShinsaibashiShinsaibashi

OsakaOsaka

Shin-osakaShin-osaka

UmedaUmeda

Osaka area

Selective Investments through Diversified Property Acquisition Channels

Other

30.1％

Othersponsors

30.7％

Sponsor

39.2％

Acquisition from sponsor group

69.9％

Historical Asset Size

■ Diversified Property Acquisition Channels Centering on Sponsor GroupsThe Investment Corporation promotes steady growth of asset size centered on the acquisition of assets from spon-sor groups, in particular Tokyu Land Corporation. In addition, we strive to reinforce our property acquisition channels through the Asset Management Company’s original information routes.

Ratio of Acquired Assets by Seller (As of August 1, 2017)

14th Fiscal Period

1 property

¥ 978 million

Acquisition through original route of the Asset Management

Company

15th Fiscal Period

Over the 4.5 years since listing,

achieved approximately 2.6-fold growth

+

During the 14th Fiscal Period, the Investment Corporation acquired five sponsor-developed properties and three ware-housing properties held by sponsors with funds procured through a public offering conducted in February 2017 for the fourth consecutive year since listing as well as borrowings. Furthermore, the Investment Corporation additionally acquired COMFORIA GYOTOKU using borrowings in June 2017.

With an aim of achieving an asset size of ¥200 billion, the Investment Corporation will continue to promote external growth by continuing to invest selectively in high-quality properties mainly in the Tokyo 23 wards, focusing on the col-laboration with our sponsor group, as well as original sourcing by TLC REIT Management, Inc., while seeking stable distri-bution levels.

8 properties

¥18,447 million

Acquisition from sponsor group

1 property

¥ 1,065 million

Acquisition through original route of the Asset Management

Company

4 properties

508 units

Acquired COMFORIA SHIBAURA

6 7

Aim to expand asset size while

maintaining a ratio of assets in the Tokyo

23 wards above 90%

Note: Since a four-for-one split of investment units was carried out effective August 1, 2014, the figures for DPU prior to the split are divided by four and rounded off to the nearest whole number.

Distribution per unit (DPU)

¥4,051 ¥4,203 ¥4,268 ¥4,296 ¥4,403 ¥4,339 ¥4,487 ¥4,549 ¥4,681 Aim to improve DPU (ongoing basis)

Occupancy rate at end of period

95.9% 96.2% 94.8% 95.2% 95.5% 96.2% 96.3% 96.5% 96.1%Consistently stable

occupancy rate

0

5,000

10,000

15,000

15th FP

16th FP

17th FP

18th FP

19th FP

20th FP

21st FP

22nd FP

23rd FP

24th FP

25th FP

26th FP

27th FP

28th FP

29th FP

30th FP

31st FP

32nd FP

33rd FP

34th FP

(Millions of yen) Existing loans Borrowing in the 14th period 1st unsecured bonds 2nd, 3rd unsecured bonds

2,0002,0003,700

5,500

8,800

1,0001,000

3,4102,000

5,860

3,4105,000 5,0005,000 4,950

6,300 6,900 7,500

12,495

3,0003,000

4,9254,9251,3502,3302,330

3,1903,190

5,0005,000

18.1％

16.5％

16.1％16.1％

16.1%

8.0%

2.3％2.0％

1.8％1.3％

0.8％0.5％

0.5％

（%）

90

95

100

90

95

100

Jul. Feb. Mar. Apr. May Jun. Jul.Aug. Sep. Oct. Nov. Dec. Jan.

Total portfolio Total portfolio (year-on-year)

Central Tokyo Sub-central Tokyo Tokyo metropolitan area Other major cities

12th FP 13th FP 14th FP

96.1% 96.3% 95.6% 96.2% 96.3% 96.6% 96.5% 96.9% 97.0% 96.0% 95.5% 95.7% 96.5%

20172016

LenderLoan balance

(millions of yen)

Mitsubishi UFJ Trust and Banking Corporation 17,670

Sumitomo Mitsui Trust Bank, Limited 16,105

Mizuho Bank, Ltd. 15,670

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 15,670

Development Bank of Japan Inc. 15,670

Sumitomo Mitsui Banking Corporation 7,785

The Norinchukin Bank 2,250

Mizuho Trust & Banking Co., Ltd. 2,000

The Bank of Fukuoka, Ltd. 1,750

The Tokyo Tomin Bank, Limited 1,300

Shinkin Central Bank 750

The 77 Bank, Ltd. 500

The Daishi Bank, Ltd. 500

Total 97,620

Financial Strategy

■ Diversification of Repayment DatesThe expected repayments of debt and investment corporation bonds as of July 31, 2017 are as follows:

The Investment Corporation will carry out equity financing (additional issuance of investment units) and debt financing (borrowings of funds and issuance of investment corporation bonds) while paying attention to financial soundness and earnings stability. Furthermore, the Investment Corporation will appropriately control its balance sheet by maintaining an LTV level to secure fund capacity.

■ Loan BalancesThe Investment Corporation’s loan balances as of July 31, 2017 are as follows:

■ Credit Rating (As of July 31, 2017)

Rating Agency Rating category Rating Outlook

Japan Credit Rating Agency, Ltd. Long-term issuer rating AA- Stable

Note: Interest-bearing debt balance/total assets

End of 14th Fiscal Period (ended Jul. 31, 2017)

ＬＴＶ (Note) 50.5%Long-term debt ratio 87.3%Fixed-interest debt ratio 87.9%Average maturity 4.3 yearsWeighted avg. interest 0.68%

Internal Growth Strategy

■ Occupancy Rate

COMFORIA WELBOX offers tenant-only internet ser-vices developed with the support of EWEL, one of the group companies. About 4,000 services are provided in total, including discount services at Tokyu Hands, another group company, as well as discounts for car rentals, cinema and accommodation.

Development of Dedicated Tenant Services

WELBOX

TOKYU SPORTS OASIS, Inc.EWEL, Inc.

■ Interest-Bearing Debt ■ Issuance of Investment Corporation Bonds

Free Use of Fitness Club

FitOnFitOn, a facility usage service for residents, was introduced to selected properties in the Comforia series. This service offers residents free use of facilities at Tokyu Sports Oasis, Inc. for a specified number of times per month.

■ Utilization of Operational Know-How of Student Apartments and DormitoriesTokyu Fudosan Holdings acquired all shares of National Students Information Center Group (currently National Students Information Center) in November 2016 with an aim to expand rental housing management businesses.

Through utilization of such operational know-how, the Investment Corporation also intends to invest in “Operational Rental Residence” such as student apartments (dormitories) which are likely to attract demand going forward.

2nd unsecured bonds

3rd unsecured bonds

Issue date Jul. 18, 2017 Jul. 18, 2017

Amount ¥ 1.0 billion ¥ 2.0 billion

Maturity 5 years 10 years

Interest Rate 0.23% annual 0.52% annual

FY2011

FY2010

FY2009

FY2008

FY2007

FY2006

FY2012

FY2013

FY2014

FY2015

FY2016

(Thousands) (Thousands)The number of students in universities, graduate school and junior college [left axis]Number of foreign students [right axis] University advancement rate

0

30

60

90

120

150

180

210

52.3%52.3%53.7%53.7%

55.3%55.3%56.2%56.2% 56.8%56.8% 56.7%56.7% 56.2%56.2%

55.1%55.1%56.7%56.7% 56.5%56.5% 56.8%56.8%

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Historical Advancement Rate and Number of Students and Foreign Students

■ Provision of Added Value to Tenants (Examples)We will improve the profitability of our portfolio through increasing tenant satisfaction and raising occupancy rates by developing dedicated tenant services.

National Students Information CenterHas developed its core business of student apart-ments and dormitories in major cities in the met-ropolitan area and owns 88,000 residential units ( inc luding propert ies managed by owners) as of the end of April 2016.

8 9

　　　　　

7675

64

63

67

68

66

65

62

9

408 21 5

2241

27

1145

6

32 2934

33

2338

13 39

37

7

8997

88

99

87

94

91

82

90

44100

10

433512

36

53

51

52

55

46

47

28

42

77

Bunkyo-kuBunkyo-kuBunkyo-kuTaito-kuTaito-kuTaito-ku Sumida-kuSumida-kuSumida-ku

Koto-kuKoto-kuKoto-ku

Shinagawa-kuShinagawa-kuShinagawa-ku

Meguro-kuMeguro-kuMeguro-ku

Ota-kuOta-kuOta-ku

Setagaya-kuSetagaya-kuSetagaya-ku

Nakano-kuNakano-kuNakano-ku

Toshima-ku

Toshima-ku

Toshima-ku

Itabashi-kuItabashi-kuItabashi-ku

Arakawa-kuArakawa-kuArakawa-ku

Kita-kuKita-kuKita-ku

Nerima-kuNerima-kuNerima-ku

Adachi-kuAdachi-kuAdachi-ku

Katsushika-kuKatsushika-kuKatsushika-ku

Edogawa-kuEdogawa-kuEdogawa-kuSuginami-kuSuginami-kuSuginami-ku

Chiyoda-ku

Chiyoda-ku

Chiyoda-ku

Chuo-kuChuo-kuChuo-ku

Minato-ku

Minato-ku

Minato-ku

Shinjuku-ku

Shinjuku-ku

Shinjuku-ku

Shibuya-kuShibuya-kuShibuya-ku

61

31

57

71

70

5673

74

72

69

59 58

80

1819

17

48

15 5016

30

14

1

4

3

202

26

4992

9893

8410483

86

85

81

60

96

105

Tokyo

Ueno

Shinagawa

Shibuya

Shinjuku

Ikebukuro

Kichijoji

Yokohama

Akabane

Nishifunabashi

COMFORIA BUNKYOHAKUSAN106

Acquired in the 14th Fiscal Period

COMFORIA AKIHABARA EAST

104


105COLLEGE COURT HACHIMANYAMA108


108

103

106

COMFORIA GYOTOKU


112

112

COMFORIA SHIBAURA


113113

107


107 COMFORIA KAMATA


105 COMFORIA MITA TROIS

54 79

78

95 101

102

109 110 111

Portfolio Map

Saitama

Chiba

Tokyo

Kanagawa COMFORIA KYOMACHIBORI110


COMFORIA AWAZA111


COMFORIA SHINSAIBASHI EAST


109

5 COMFORIA BUNKYOKASUGA

6 COMFORIA ASAKUSAMATSUGAYA

7 COMFORIA NISHIOI

8 COMFORIA NAKANO

9 COMFORIA SHIMOKITAZAWA

10 COMFORIA NISHIKAMATA

11 COMFORIA OYAMA

12 COMFORIA KIYOSUMISHIRAKAWA SOUTH

13 COMFORIA KOMAZAWA

21 COMFORIA KOISHIKAWA

22 COMFORIA SENGOKU

23 COMFORIA DAIKANYAMAAOBADAI

27 COMFORIA IKEBUKURO

29 COMFORIA RYOGOKUISHIWARA

32 COMFORIA ASAKUSABASHI DEUX

33 COMFORIA OSHIAGE

34 COMFORIA HONJOAZUMABASHI

35 COMFORIA KIYOSUMISHIRAKAWA TROIS

36 COMFORIA MONZENNAKACHO

37 COMFORIA HIMONYA

38 COMFORIA MISYUKU

39 COMFORIA GAKUGEIDAIGAKU

40 COMFORIA HIGASHINAKANO DEUX

41 COMFORIA HIGASHIIKEBUKURO WEST

43 COMFORIA RYOGOKU DEUX

44 COMFORIA OMORI DEUX

45 COMFORIA MACHIYA

51 COMFORIA ASAKUSABASHI

52 COMFORIA RYOGOKU SOUTH

53 COMFORIA TOYOSU

55 COMFORIA SUMIDA-TACHIBANA

62 COMFORIA UENOHIROKOJI

63 COMFORIA KASUGATOMISAKA

64 COMFORIA HONKOMAGOME

65 COMFORIA MORISHITA

66 COMFORIA KIBAKOEN

67 COMFORIA MEGURO CHOJAMARU

68 COMFORIA NISHIMAGOME

75 COMFORIA HIGASHIIKEBUKURO EAST

76 COMFORIA HIGASHIIKEBUKURO

82 COMFORIA KOMABA

87 COMFORIA KINSHICHO

88 COMFORIA MINAMISUNAMACHI

89 COMFORIA HIGASHISHINAGAWA

90 COMFORIA MEGUROYAKUMO

91 COMFORIA YOGA

94 COMFORIA ITABASHINAKAJUKU

97 COMFORIA SHINAGAWA EAST

99 COMFORIA OJIMA

100 COMFORIA OMORI TROIS

106 COMFORIA BUNKYOHAKUSAN

107 COMFORIA KAMATA

108 COLLEGE COURT HACHIMANYAMA

The Investment Corporation manages assets with superb accessibility located mainly in the Tokyo 23 wards.Central Tokyo 43 properties

1 COMFORIA NIHONBASHI NINGYOCHO

2 COMFORIA WASEDA

3 COMFORIA SHIMOOCHIAI

4 COMFORIA HIGASHINAKANO

14 COMFORIA GINZA EAST

15 COMFORIA AZABUDAI

16 COMFORIA SHIBAKOEN

17 COMFORIA NISHIAZABU

18 COMFORIA MINAMIAOYAMA

19 COMFORIA MINAMIAOYAMA DEUX

20 COMFORIA NISHIWASEDA

26 COMFORIA HARAJYUKU

30 COMFORIA MITA NORTH

31 COMFORIA SHIBAURA BOWHOUSE

48 COMFORIA SHIROKANETAKANAWA

49 COMFORIA NIHONBASHI NINGYOCHO EAST

50 COMFORIA ATAGO

56 COMFORIA KUDAN

57 COMFORIA NIHONBASHI NINGYOCHO NORTH

58 COMFORIA SHINKAWA

59 COMFORIA AKASAKA

60 COMFORIA MITA EAST

61 COMFORIA SHIBAURA CANAL

69 COMFORIA KITASANDO

70 COMFORIA YOYOGIUEHARA

71 COMFORIA SASAZUKA

72 COMFORIA SHINJUKUGYOENⅡ73 COMFORIA ICHIGAYAYANAGICHO

74 COMFORIA KAGURAZAKA

80 COMFORIA NIBANCHO

81 COMFORIA NISHISHINJUKU

83 COMFORIA KANDAJINBOCHO

84 COMFORIA NIHONBASHI

85 COMFORIA TAMACHI

86 COMFORIA AZABUJUBAN

92 COMFORIA SHINJUKUGYOENⅠ93 COMFORIA KAGURAZAKA DEUX

96 COMFORIA AZABU EAST

98 COMFORIA SHINJUKU EASTSIDE TOWER

103 COMFORIA ICHIGAYAYAKUOJI

104 COMFORIA AKIHABARA EAST

105 COMFORIA MITA TROIS

113 COMFORIA SHIBAURA

Sub-central Tokyo 53 properties

28 COMFORIA KOMAE

42 COMFORIA YOKOHAMAKANNAI

46 COMFORIA ICHIKAWAMYODEN

47 COMFORIA YATSUKA

77 COMFORIA SHINKOYASU

112 COMFORIA GYOTOKU

Tokyo metropolitan area 6 properties

Total 111 properties

Other major cities 9 properties

54 COMFORIA SHIN-OSAKA

78 COMFORIA SHINSAKAE

79 COMFORIA KITAHORIE

95 COMFORIA KITASANJO

101 COMFORIA SAPPORO SHOKUBUTSUEN

102 COMFORIA OGIMACHI

109 COMFORIA SHINSAIBASHI EAST

110 COMFORIA KYOMACHIBORI

111 COMFORIA AWAZA

(As of August 1, 2017)

Central Tokyo　

Sub-central Tokyo

Tokyo metropolitan area　

Other major cities

10 11

No. Property name Location Gross floor area

(m2)Rentable

units Acquisition price (thousands of yen)

Investment ratio (%)

■ Central Tokyo ■ Sub-central Tokyo ■ Tokyo metropolitan area ■ Other major cities

No. Property name Location Gross floor area

(m2)Rentable

units Acquisition price (thousands of yen)

Investment ratio (%)

63 COMFORIA KASUGATOMISAKA Kasuga, Bunkyo-ku, Tokyo 4,479.23 106 2,912,150 1.5

64 COMFORIA HONKOMAGOME Honkomagome, Bunkyo-ku, Tokyo 2,623.37 36 1,344,000 0.7

65 COMFORIA MORISHITA Shinohashi, Koto-ku, Tokyo 2,159.39 75 1,530,000 0.8

66 COMFORIA KIBAKOEN Kiba, Koto-ku, Tokyo 1,753.85 60 956,000 0.5

67 COMFORIA MEGURO CHOJAMARU Kamiosaki, Shinagawa-ku, Tokyo 3,720.52 71 1,972,000 1.0

68 COMFORIA NISHIMAGOME Nishimagome, Ota-ku, Tokyo 1,797.93 52 990,000 0.5

69 COMFORIA KITASANDO Sendagaya, Shibuya-ku, Tokyo 7,667.04 144 4,268,000 2.3

70 COMFORIA YOYOGIUEHARA Uehara, Shibuya-ku, Tokyo 2,344.24 51 1,560,000 0.8

71 COMFORIA SASAZUKA Sasazuka, Shibuya-ku, Tokyo 3,440.91 89 1,789,000 0.9

72 COMFORIA SHINJUKUGYOEN Ⅱ Shinjuku, Shinjuku-ku, Tokyo 2,312.79 65 1,806,000 1.0

73 COMFORIA ICHIGAYAYANAGICHO Ichigayayanagicho, Shinjuku-ku, Tokyo 2,416.85 69 1,623,000 0.9

74 COMFORIA KAGURAZAKA Iwatocho, Shinjuku-ku, Tokyo 1,161.31 29 736,000 0.4

75 COMFORIA HIGASHIIKEBUKURO EAST Higashiikebukuro, Toshima-ku, Tokyo 3,156.84 90 1,712,000 0.9

76 COMFORIA HIGASHIIKEBUKURO Higashiikebukuro, Toshima-ku, Tokyo 1,798.18 48 1,132,000 0.6

77 COMFORIA SHINKOYASU Koyasudori, Kanagawa-ku, Yokohama-shi, Kanagawa 2,622.19 36 1,077,000 0.6

78 COMFORIA SHINSAKAE Shinsakae, Naka-ku, Nagoya-shi, Aichi 4,098.97 144 1,653,400 0.9

79 COMFORIA KITAHORIE Kitahorie, Nishi-ku, Osaka-shi, Osaka 1,910.01 73 1,010,000 0.5

80 COMFORIA NIBANCHO Nibancho, Chiyoda-ku, Tokyo 2,165.01 42 1,621,000 0.9

81 COMFORIA NISHISHINJUKU Kitashinjuku, Shinjuku-ku, Tokyo 1,947.14 56 1,625,000 0.9

82 COMFORIA KOMABA Ikejiri, Setagaya-ku, Tokyo 7,450.62 136 5,000,000 2.7

83 COMFORIA KANDAJINBOCHO Kandajinbocho, Chiyoda-ku, Tokyo 1,823.86 43 1,434,000 0.8

84 COMFORIA NIHONBASHI Nihonbashibakurocho, Chuo-ku, Tokyo 2,950.59 63 1,956,000 1.0

85 COMFORIA TAMACHI Shibaura, Minato-ku, Tokyo 5,494.78 77 3,272,000 1.7

86 COMFORIA AZABUJUBAN Mita, Minato-ku, Tokyo 1,632.38 55 1,471,000 0.8

87 COMFORIA KINSHICHO Taihei, Sumida-ku, Tokyo 1,917.15 46 1,042,000 0.6

88 COMFORIA MINAMISUNAMACHI Minamisuna, Koto-ku, Tokyo 8,124.20 211 4,681,000 2.5

89 COMFORIA HIGASHISHINAGAWA Higashishinagawa, Shinagawa-ku, Tokyo 3,298.65 86 1,510,000 0.8

90 COMFORIA MEGUROYAKUMO Yakumo, Meguro-ku, Tokyo 1,333.57 36 813,000 0.4

91 COMFORIA YOGA Yoga, Setagaya-ku, Tokyo 1,798.36 39 1,041,000 0.6

92 COMFORIA SHINJUKUGYOEN Ⅰ Shinjuku, Shinjuku-ku, Tokyo 1,832.93 52 1,406,000 0.7

93 COMFORIA KAGURAZAKA DEUX Iwatocho, Shinjuku-ku, Tokyo 1,637.00 46 1,245,000 0.7

94 COMFORIA ITABASHINAKAJUKU Nakajuku, Itabashi-ku, Tokyo 7,732.25 104 3,794,280 2.0

95 COMFORIA KITASANJO Kitasanjohigashi, Chuo-ku, Sapporo-shi, Hokkaido 3,949.79 60 660,000 0.4

96 COMFORIA AZABU EAST Higashiazabu, Minato-ku, Tokyo 3,505.12 69 1,900,000 1.0

97 COMFORIA SHINAGAWA EAST Kitashinagawa, Shinagawa-ku, Tokyo 3,701.07 97 1,430,000 0.8

98 COMFORIA SHINJUKU EASTSIDE TOWER Shinjuku, Shinjuku-ku, Tokyo(Tower Building) (Annex Building)(Gate Building)

69,308.352,305.29

203.15765 13,264,000 7.0

99 COMFORIA OJIMA Ojima, Koto-ku, Tokyo 2,828.47 99 2,110,000 1.1

100 COMFORIA OMORI TROIS Omorikita, Ota-ku, Tokyo 1,232.52 45 866,000 0.5

101 COMFORIA SAPPORO SHOKUBUTSUEN Kitanijonishi, Chuo-ku, Sapporo-shi, Hokkaido 4,062.44 42 1,250,000 0.7

102 COMFORIA OGIMACHI Tenjinbashi, Kita-ku, Osaka-shi, Osaka 2,374.77 88 1,435,000 0.8

103 COMFORIA ICHIGAYAYAKUOJI Ichigayayakuojimachi, Shinjuku-ku, Tokyo 1,392.29 21 941,000 0.5

104 COMFORIA AKIHABARA EAST Higashikanda, Chiyoda-ku, Tokyo 5,192.38 131 4,425,000 2.3

105 COMFORIA MITA TROIS Shiba, Minato-ku, Tokyo 1,096.43 32 890,000 0.5

106 COMFORIA BUNKYOHAKUSAN Honkomagome, Bunkyo-ku, Tokyo 1,971.16 56 1,330,000 0.7

107 COMFORIA KAMATA Kamata, Ota-ku, Tokyo 7,900.68 203 5,721,000 3.0

108 COLLEGE COURT HACHIMANYAMA Kamitakaido, Suginami-ku, Tokyo 1,923.34 73 1,245,000 0.7

109 COMFORIA SHINSAIBASHI EAST Bakuromachi, Chuo-ku, Osaka-shi, Osaka 3,407.91 112 1,980,000 1.1

110 COMFORIA KYOMACHIBORI Kyomachibori, Nishi-ku, Osaka-shi, Osaka 2,625.18 84 1,567,000 0.8

111 COMFORIA AWAZA Enokojima, Nishi-ku, Osaka-shi, Osaka 2,844.34 84 1,289,000 0.7

112 COMFORIA GYOTOKU Gyotokuekimae, Ichikawa-shi, Chiba 1,347.25 56 978,000 0.5

Sub-total 380,719.42 8,129 187,471,137 99.4

Assets acquired in the 15th Fiscal Period113 COMFORIA SHIBAURA Shibaura, Minato-ku, Tokyo 1,213.34 39 1,065,680 0.6

Sub-total 1,213.34 39 1,065,680 0.6

Total 381,932.76 8,168 188,536,817 100.0

Portfolio properties at the 14th Fiscal Period-end

Portfolio List

1 COMFORIA NIHONBASHI NINGYOCHO Nihonbashi Ningyocho, Chuo-ku, Tokyo 3,021.53 45 1,586,837 0.8

2 COMFORIA WASEDA Bentencho, Shinjuku-ku, Tokyo 3,080.28 79 1,900,000 1.0

3 COMFORIA SHIMOOCHIAI Nakaochiai, Shinjuku-ku, Tokyo 2,726.15 44 1,181,000 0.6

4 COMFORIA HIGASHINAKANO Kitashinjuku, Shinjuku-ku, Tokyo 1,058.75 37 552,707 0.3

5 COMFORIA BUNKYOKASUGA Nishikata, Bunkyo-ku, Tokyo 3,198.54 80 1,470,000 0.8

6 COMFORIA ASAKUSAMATSUGAYA Matsugaya, Taito-ku, Tokyo 2,264.84 62 910,000 0.5

7 COMFORIA NISHIOI Nishioi, Shinagawa-ku, Tokyo 1,542.53 59 902,370 0.5

8 COMFORIA NAKANO Kamitakada, Nakano-ku, Tokyo 1,935.39 35 881,863 0.5

9 COMFORIA SHIMOKITAZAWA Hanegi, Setagaya-ku, Tokyo 5,287.18 116 2,587,000 1.4

10 COMFORIA NISHIKAMATA Nishikamata, Ota-ku, Tokyo 3,358.99 103 1,550,000 0.8

11 COMFORIA OYAMA Oyamacho, Itabashi-ku, Tokyo 4,793.28 97 1,987,000 1.1

12 COMFORIA KIYOSUMISHIRAKAWA SOUTH Miyoshi, Koto-ku, Tokyo 1,317.22 45 740,000 0.4

13 COMFORIA KOMAZAWA Komazawa, Setagaya-ku, Tokyo 1,695.46 39 1,290,000 0.7

14 COMFORIA GINZA EAST Irifune, Chuo-ku, Tokyo 5,773.48 133 3,059,000 1.6

15 COMFORIA AZABUDAI Azabudai, Minato-ku, Tokyo 1,028.94 24 574,000 0.3

16 COMFORIA SHIBAKOEN Shibakoen, Minato-ku, Tokyo 1,914.13 54 1,398,000 0.7

17 COMFORIA NISHIAZABU Nishiazabu, Minato-ku, Tokyo 1,069.77 22 755,000 0.4

18 COMFORIA MINAMIAOYAMA Minamiaoyama, Minato-ku, Tokyo 1,763.88 24 1,041,000 0.6

19 COMFORIA MINAMIAOYAMA DEUX Minamiaoyama, Minato-ku, Tokyo 487.97 6 248,000 0.1

20 COMFORIA NISHIWASEDA Takadanobaba, Shinjuku-ku, Tokyo 2,971.10 60 1,685,000 0.9

21 COMFORIA KOISHIKAWA Koishikawa, Bunkyo-ku, Tokyo 1,015.71 37 552,000 0.3

22 COMFORIA SENGOKU Sengoku, Bunkyo-ku, Tokyo 3,514.75 44 1,219,000 0.6

23 COMFORIA DAIKANYAMAAOBADAI Aobadai, Meguro-ku, Tokyo 1,533.95 26 926,000 0.5

26 COMFORIA HARAJYUKU Sendagaya, Shibuya-ku, Tokyo 6,314.63 99 3,629,000 1.9

27 COMFORIA IKEBUKURO Ikebukuro, Toshima-ku, Tokyo 1,171.21 28 602,000 0.3

28 COMFORIA KOMAE Iwadokita, Komae-shi, Tokyo 1,468.30 24 399,000 0.2

29 COMFORIA RYOGOKUISHIWARA Ishiwara, Sumida-ku, Tokyo 1,151.47 47 651,000 0.3

30 COMFORIA MITA NORTH Mita, Minato-ku, Tokyo 1,257.94 30 850,000 0.5

31 COMFORIA SHIBAURA BOWHOUSE Kaigan, Minato-ku, Tokyo 4,862.18 75 2,650,000 1.4

32 COMFORIA ASAKUSABASHI DEUX Asakusabashi, Taito-ku, Tokyo 1,596.33 46 874,000 0.5

33 COMFORIA OSHIAGE Narihira, Sumida-ku, Tokyo 1,369.26 47 714,000 0.4

34 COMFORIA HONJOAZUMABASHI Honjo, Sumida-ku, Tokyo 1,434.29 48 762,000 0.4

35 COMFORIA KIYOSUMISHIRAKAWA TROIS Shirakawa, Koto-ku, Tokyo 1,553.45 50 873,000 0.5

36 COMFORIA MONZENNAKACHO Fuyuki, Koto-ku, Tokyo 4,916.04 144 2,658,000 1.4

37 COMFORIA HIMONYA Himonya, Meguro-ku, Tokyo 2,302.53 28 1,189,000 0.6

38 COMFORIA MISYUKU Ikejiri, Setagaya-ku, Tokyo 2,842.56 59 1,874,000 1.0

39 COMFORIA GAKUGEIDAIGAKU Shimouma, Setagaya-ku, Tokyo 1,919.59 38 1,138,000 0.6

40 COMFORIA HIGASHINAKANO DEUX Higashinakano, Nakano-ku, Tokyo 1,419.08 40 833,000 0.4

41 COMFORIA HIGASHIIKEBUKURO WEST Higashiikebukuro, Toshima-ku, Tokyo 8,296.57 155 3,911,000 2.1

42 COMFORIA YOKOHAMAKANNAI Okinacho, Naka-ku, Yokohama-shi, Kanagawa 2,377.62 60 972,000 0.5

43 COMFORIA RYOGOKU DEUX Chitose, Sumida-ku, Tokyo 2,010.27 66 1,014,730 0.5

44 COMFORIA OMORI DEUX Omorikita, Ota-ku, Tokyo 2,180.52 64 1,188,000 0.6

45 COMFORIA MACHIYA Arakawa, Arakawa-ku, Tokyo 1,361.92 30 594,000 0.3

46 COMFORIA ICHIKAWAMYODEN Shioyaki, Ichikawa-shi, Chiba 1,533.11 48 606,000 0.3

47 COMFORIA YATSUKA Sezaki, Soka-shi, Saitama 1,710.09 62 626,000 0.3

48 COMFORIA SHIROKANETAKANAWA Mita, Minato-ku, Tokyo 1,932.57 37 1,300,000 0.7

49 COMFORIA NIHONBASHI NINGYOCHO EAST Nihonbashi Ningyocho, Chuo-ku, Tokyo 2,912.38 82 2,139,300 1.1

50 COMFORIA ATAGO Toranomon, Minato-ku, Tokyo 1,147.20 38 826,000 0.4

51 COMFORIA ASAKUSABASHI Yanagibashi, Taito-ku, Tokyo 5,273.67 141 2,680,000 1.4

52 COMFORIA RYOGOKU SOUTH Chitose, Sumida-ku, Tokyo 2,404.23 61 1,240,000 0.7

53 COMFORIA TOYOSU Edagawa, Koto-ku, Tokyo 4,513.10 161 3,096,650 1.6

54 COMFORIA SHIN-OSAKA Higashinakajima, Higashiyodogawa-ku, Osaka-shi, Osaka 6,530.63 133 2,400,000 1.3

55 COMFORIA SUMIDA-TACHIBANA Tachibana, Sumida-ku, Tokyo 1,888.25 56 938,000 0.5

56 COMFORIA KUDAN Kudanminami, Chiyoda-ku, Tokyo 1,787.89 36 1,280,500 0.7

57 COMFORIA NIHONBASHI NINGYOCHO NORTH Nihonbashi Horidomecho, Chuo-ku, Tokyo 1,717.58 36 1,108,000 0.6

58 COMFORIA SHINKAWA Shinkawa, Chuo-ku, Tokyo 2,866.08 59 1,840,800 1.0

59 COMFORIA AKASAKA Akasaka, Minato-ku, Tokyo 2,956.70 40 1,945,000 1.0

60 COMFORIA MITA EAST Shiba, Minato-ku, Tokyo 4,973.31 111 3,190,550 1.7

61 COMFORIA SHIBAURA CANAL Kaigan, Minato-ku, Tokyo 2,703.41 95 1,570,000 0.8

62 COMFORIA UENOHIROKOJI Ueno, Taito-ku, Tokyo 1,935.60 37 1,050,000 0.6

12 13

COMFORIA SASAZUKA71

COMFORIA KITASANDO69

COMFORIA YOYOGIUEHARA70

COMFORIA SHINJUKUGYOEN Ⅱ72Central Tokyo

COMFORIA SHINJUKU EASTSIDE TOWER98

COMFORIA KAGURAZAKA DEUX93

COMFORIA NIBANCHO80

COMFORIA AZABU EAST96

COMFORIA AZABUJUBAN86

COMFORIA NIHONBASHI84

COMFORIA TAMACHI85

COMFORIA KANDAJINBOCHO83

COMFORIA MITA EAST60

Sub-central Tokyo

COMFORIA YOGA91COMFORIA SHINAGAWA EAST97

Portfolio List

14 15

COMFORIA SHIN-OSAKA54COMFORIA YATSUKA47COMFORIA YOKOHAMAKANNAI42

Tokyo metropolitan area Other major cities

COMFORIA HIGASHISHINAGAWA89

COMFORIA MINAMISUNAMACHI88 COMFORIA KINSHICHO87 COMFORIA KOMABA82

COMFORIA ASAKUSABASHI51

Basic Policies

■ Value Chain of the Tokyu Fudosan Holdings GroupWe have concluded sponsor support agreements, support agreements and property management agreements for man-aged assets with the Asset Management Company and the Tokyu Fudosan Holdings Group companies to fully utilize the value chain and expertise of the Tokyu Fudosan Holdings Group. With the support of the Tokyu Fudosan Holdings Group companies through such agreements, we will aim to expand our asset size (external growth), and maintain and increase asset value (internal growth).

■ “COMFORIA” SeriesWe will invest in and manage rental residences, fully utilizing the concept and expertise of the urban rental residence “Comforia” series, which Tokyu Land Corporation has produced.

We invest intensively in rental residences for singles and small families, mainly in the Tokyo metropolitan area, based on our basic policies of “investments in residential properties with stable earnings and high growth potential” and “utilization of the Tokyu Fudosan Holdings Group,” with the aim of ensuring stable earnings over the medium and long term and maximizing our unitholders’ value.

For a Superior Level of Living ComfortCOMFORIA is the name we have given to the urban rental residences produced by the Tokyu Land Corporation.

The word COMFORIA is a compound that we coined from “comfort,” and “ia,” a Latin suffix meaning “place.” The idea that residences are not just containers has given birth to our “COMFORIA” series of rental residences made

specifically for people who wish to live freely and affluently in urban communities. COMFORIA offers living comfort beyond expectation and surpasses the level of mere convenience in many ways.

Four Advantages COMFORIA Offers

COMFORIA knows how valuable time is.

COMFORIA knowswhat high quality

feels like.

COMFORIA knows where peace of mind

comes from.

COMFORIA knows how residents feel.

Welfare service agency business

Management, planning and operation of a comprehensive fitness club based on

private membership

Management and operation of senior housing and nursing homes

Property management/Tenant leasing TOKYU LIVABLE, INC. Comprehensive real estate marketing

intermediary and brokerage of land and buildings

TOKYU SPORTS OASIS, Inc.TOKYU E-LIFE DESIGN Inc.

Management of condominiums and buildingsEWEL, Inc.

Support agreement

Support agreement

Support agreement

Support agreementSupport agreement

Support agreement

● Information on the sale of properties ● Market information

TOKYU LAND CORPORATION Comprehensive real estate developer

Sponsor support agreement

● Information on the sale of properties ● Warehousing ● Advisory● Human resources/Expertise

● Information on the sale of properties ● Considering becoming tenants ● Market information

● Information on the sale of properties ● Considering becoming tenants ● Market information

Property management agreement

● Information on the welfare services for

residential tenants

● Market information● Providing information and making proposals concerning services, etc. for tenants of rental residences.

Tokyu Housing Lease Corporation

TOKYU COMMUNITY CORP. TLC REIT Management Inc.

Portfolio List

16 17

Name of the investment corporation Comforia Residential REIT, Inc

Representative Takehiro Izawa, Executive Director

Address 1-1 Minami-Aoyama 1-chome, Minato-ku, Tokyo 107-0062, Japan

Inquiries TLC REIT Management, Inc. Tel: +81-3-3401-1090

Fiscal period-end January 31 and July 31 of each year

Asset Custodian General Administration (operation of the administrative instrument)

Transfer Agent

Mitsubishi UFJ Trust and Banking Corporation

Sponsor

TOKYU LAND CORPORATION

TOKYU LIVABLE, INC. TOKYU COMMUNITY CORP.

Tokyu Housing Lease Corporation TOKYU E-LIFE DESIGN Inc.

EWEL, Inc. TOKYU SPORTS OASIS, Inc.

Asset Management Company

TLC REIT Management Inc.

2

General Administration (accounting, etc.)

Heiseikaikeisha Tax Corporation

31

General Administration (corporation bond)

Sumitomo Mitsui Trust Bank, Limited

46

5

1

3

2Asset management agreement

Asset custody agreement, Administrative service agreement, Transfer agency agreement

Accounting service agreement

5

4

6

Fiscal, issuing and payment agency agreement

Sponsor support agreement

Support agreement

Supporting Company

The Investment Corporation

Unitholders’ Meeting

Auditor

Ernst & Young ShinNihon LLC

Board of Directors

Executive Director: Takehiro IzawaSupervisory Director: Yoshihiro Kataoka

Supervisory Director: Koji Yamamoto


Structure

Shareholders’ Meeting

Board of Directors

President & CEO

Activia Management Div.

Comforia Management Div.

Broadia Management Div.

Corporate Auditor

Compliance Committee

Acquisition Priority Review Meeting

Compliance Dept.

Investment Committee

Internal Audit Dept.

Finance & Accounting Dept.

Corporate Planning & Administration Dept.

Asset Investment Dept.

Strategic Mgt. Dept.

Asset Mgt. Dept.


Asset Mgt. Dept.


Asset Mgt. Dept.

Overview of Organization

June 8, 2010 Registration of incorporation, and foundation under Article 166 of the Act on Investment Trusts and Investment Corporations

June 30, 2010 Implementation of registration by the prime minister under Article 187 of the Act on Investment Trusts and Investment Corporations (registration number: Director of Kanto Finance Bureau No. 71)

February 6, 2013 Listed on the Real Estate Investment Trust Securities Market of the Tokyo Stock Exchange

History

■ Overview of the Investment Corporation

Overview of the Investment Corporation and Asset Management Company

Trade name TLC REIT Management, Inc.

Representative Hiroyuki Tomata, President & CEO

Address 1-1 Minami-Aoyama 1-chome, Minato-ku, Tokyo 107-0062, Japan

Established October 2009

Capita ¥200 million

Shareholder Tokyu Land Corporation 100%

Registrations/ Licenses

Financial Instruments Business Firm, granted by the Director of the Kanto Regional Finance Bureau (Financial Instruments) Registration No. 2370

Discretionary Transaction Agent granted by the Minister of Land, Infrastructure, Transport and Tourism, Registration No. 65

Building Lots and Building Transactions Business License, granted by the Governor of Tokyo (2) No. 91139

■ Overview of the Asset Management Company

18

ⅠⅠ. Asset Management Report

Overview of Asset Management

Asset Management Report for the 14th Fiscal Period (Semi-Annual Report) From February 1, 2017 to July 31, 2017


1-1 Minami-Aoyama 1-chome, Minato-ku, Tokyo 107-0062, Japan

II. Asset Management Report III. Financial Section

Balance Sheets Statements of Income Statements of Changes in Unitholders’ Equity Statements of Cash Distributions Statements of Cash Flows Notes Supplementary Schedules Independent Auditor’s Report

II. Asset Management Report Overview of Asset Management 1. Performance of the Investment Corporation

Fiscal period 10th Fiscal Period

11th Fiscal Period

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

Business period From

Feb. 1, 2015 to Jul. 31, 2015

From Aug. 1, 2015 to Jan. 31, 2016

From Feb. 1, 2016 to Jul. 31, 2016

From Aug. 1, 2016 to Jan. 31, 2017

From Feb. 1, 2017 to Jul. 31, 2017

Operating revenue (millions of yen) 4,952 5,050 6,531 6,674 7,276 [Rent revenue - real estate] (millions of yen) [4,942] [4,957] [6,531] [6,674] [7,276] Operating expenses (millions of yen) 2,416 2,446 3,785 3,885 4,178 [Expenses related to rent business] (millions of yen) [1,919] [1,902] [3,196] [3,249] [3,518] Operating profit (millions of yen) 2,535 2,603 2,746 2,788 3,098 Ordinary profit (millions of yen) 2,087 2,148 2,312 2,341 2,613 Profit (millions of yen) 2,086 2,147 2,304 2,335 2,608 Total assets (millions of yen) 158,962 159,245 179,944 183,902 205,121 [Period-on-period change] (%) [19.6] [0.2] [13.0] [2.2] [11.5] Net assets (millions of yen) 77,310 77,369 85,139 85,171 97,258 [Period-on-period change] (%) [31.9] [0.1] [10.0] [0.0] [14.2] Unitholders’ capital (millions of yen) 75,224 75,224 82,743 82,743 94,557 Number of investment units issued (units) 473,804 473,804 513,504 513,504 563,694 Net assets per unit (yen) 163,169 163,295 165,801 165,863 172,537 Total distributions (millions of yen) 2,086 2,055 2,304 2,335 2,638 Distribution per unit (yen) 4,403 4,339 4,487 4,549 4,681 [Earnings distribution per unit] (yen) [4,403] [4,339] [4,487] [4,549] [4,681] [Distribution in excess of earnings per unit] (yen) [–] [–] [–] [–] [–]

Return on assets (Note 1) (%) 1.4 1.4 1.4 1.3 1.3 Return on unitholders’ equity (Note 2) (%) 3.1 2.8 2.8 2.7 2.9 Unitholders’ equity ratio (Note 3) (%) 48.6 48.6 47.3 46.3 47.4 [Period-on-period change] (%) [4.5] [–0.0] [–1.3] [–1.0] [1.1] Interest-bearing debt (millions of yen) 78,990 79,270 91,060 94,970 103,620 Interest-bearing debt ratio (Note 4) (%) 49.7 49.8 50.6 51.6 50.5 Payout ratio (Note 5) (%) 99.9 95.7 99.9 100.0 101.1 Number of properties (properties) 94 94 98 101 110 Total leasable area (m2) 214,620.36 217,652.64 272,172.73 278,745.27 303,025.09 Occupancy rate at end of period (%) 95.5 96.2 96.3 96.5 96.1 Depreciation (millions of yen) 816 821 1,017 1,049 1,137 Capital expenditure (millions of yen) 52 52 131 112 386 NOI (Note 6) (millions of yen) 3,839 3,875 4,352 4,474 4,896

(Note 1) Ordinary profit ÷ [(Total assets at beginning of period + Total assets at end of period) ÷ 2] × 100 (Note 2) Profit ÷ [(Net assets at beginning of period + Net assets at end of period) ÷ 2] × 100 (Note 3) Net assets at end of period ÷ Total assets at end of period × 100 (Note 4) Interest-bearing debt at end of period ÷ Total assets at end of period × 100 (Note 5) Total distributions ÷ Profit × 100 Payout ratio is rounded down to the first decimal place. (Note 6) Income from real estate rental business+ Depreciation

2120


2. Asset Management Status for the 14th Fiscal Period (1) History of the Investment Corporation

Comforia Residential REIT, Inc (the “Investment Corporation”) was established on June 8, 2010 as an investment corporation that invests mainly in residential properties in accordance with the “Act on Investment Trusts and Investment Corporations” of Japan (Act No. 198 of 1951, as revised; hereinafter referred to as the “Investment Trusts Act”), with registration by the Prime Minister completed as of June 30, 2010 under Article 187 of the Investment Trusts Act (registration number: Director of Kanto Finance Bureau No. 71). Investments by the Investment Corporation commenced in August 2010. The Investment Corporation issued new investment units (18,691 units) through a public offering on February 6, 2013 and was listed on the real estate investment trust market of the Tokyo Stock Exchange, Inc. (securities code: 3282).

Managed assets of the Investment Corporation at the commencement of operations totaled 11 properties, acquired for a total of ¥15,508 million. As a result of additional acquisition and sale of properties under the basic policy of asset management (to manage assets with the aim of achieving stable earnings and ensuring the steady growth of our managed assets based on medium- to long-term perspectives to maximize our unitholders’ value) stipulated in the regulations of the Investment Corporation, the portfolio (the “Acquired Assets”) owned as of the end of the 14th Fiscal Period includes 110 properties, acquired for a total of ¥187,471 million.

(2) Investment performance

(i) Investment environment During the 14th Fiscal Period, the Japanese economy remained on a modest recovery trend amid improvements in the employment and income environment. Under these circumstances, in the residential rental market, unit rent has shown an upward trend centering on central Tokyo while occupancy rate remained high. In the real estate investment market, the level of transaction prices remains stable at a high price range amid an ongoing low interest rate environment resulting from the fiscal policies of the government and monetary policies of the Bank of Japan (BOJ).

(ii) Acquisition of assets

During the 14th Fiscal Period, the Investment Corporation acquired a total 9 properties of COMFORIA AKIHABARA EAST and other 7 properties in February 2017 and COMFORIA GYOTOKU in June 2017. As a result, assets owned by the Investment Corporation as of the end of the 14th Fiscal Period totaled 110 properties, acquired for a total of ¥187,471 million.

(iii) Operation management of assets owned by the Investment Corporation

The Investment Corporation consigns property management operations mainly to Tokyu Housing Lease Corporation, which has an extensive track record in managing the “Comforia” series of properties. Under the “Comforia” series, the Investment Corporation promotes unified management and strives to improve operational efficiency and shorten periods of vacancy.

(3) Overview of funding

During the 14th Fiscal Period, the Investment Corporation conducted additional issuance of investment units (50,190 units) and borrowed funds (¥10,190 million) to be appropriated for the acquisition of COMFORIA AKIHABARA EAST and seven other properties in February 2017 as well as for the repayment of borrowings (¥2,540 million) undertaken in September 2016 and December 2016. Subsequently, additional borrowings of funds were undertaken to acquire COMFORIA GYOTOKU (¥1,000 million). Furthermore, the Investment Corporation issued investment corporation bonds (¥3,000 million) in July 2017 to be appropriated for the partial repayment of borrowings (¥3,000 million) undertaken in February 2017 and June 2017. As a result, unitholders’ capital as of the end of the 14th Fiscal Period (July 31, 2017) was ¥94,557 million, interest-bearing debt was ¥103,620 million, the ratio of interest-bearing debt to total assets (LTV) was 50.5%, the average maturity of interest-bearing debt was 4.3 years, the ratio of long-term debt was 87.3%, and the fixed rate ratio was 87.9%.

The Investment Corporation obtained the following rating as of the end of the 14th Fiscal Period.

Name of credit rating agency Rating Outlook Japan Credit Rating Agency, Ltd. (JCR) AA– Stable

(4) Overview of performance and distributions

As a result of investment during the 14th Fiscal Period, the Investment Corporation posted operating revenue of ¥7,276 million, operating profit of ¥3,098 million, ordinary profit of ¥2,613 million, and profit of ¥2,608 million.

The Investment Corporation carries out distributions so that the Special Provisions for Taxation on Investment Corporations (Article 67-15 of the Act on Special Measures Concerning Taxation [Act No. 26 of 1957, as revised; hereinafter referred to as the “Act on Special Measures Concerning Taxation”]) would be applied. For the 14th Fiscal Period, the Investment Corporation reversed part (¥30 million) of reserve for reduction entry provided in accordance with Special Provisions on Taxation in the case of advance acquisition of land and such in 2009 and 2010 (Article 66-2 of the Act on Special Measures Concerning Taxation), after distributing almost all unappropriated retained earnings. As a result, the distribution per unit (DPU) was ¥4,681 for the period.

3. Capital Increases

Date Type Number of investment units

issued (units) Unitholders’ capital

(millions of yen) Remarks Change Balance Change Balance

June 8, 2010 Establishment through private placement 200 200 100 100 (Note 1)

August 30, 2010 Capital increase through private placement 7,800 8,000 3,900 4,000 (Note 2)

March 18, 2011 Capital increase through private placement 24,270 32,270 11,840 15,840 (Note 3)

February 2, 2012 Capital increase through private placement 16,400 48,670 8,200 24,040 (Note 4)

February 5, 2013 Capital increase through public offering 18,691 67,361 9,935 33,975 (Note 5)


February 26, 2014 Capital increase through third-party allotment 1,401 100,662 964 56,900 (Note 7)

August 1, 2014 Investment unit split 301,986 402,648 – 56,900 (Note 8)







(Note 1) Established at an issue price of ¥500,000 per investment unit. (Note 2) Issued privately placed investment units at an issue price of ¥500,000 per investment unit to fund the acquisition of new properties. (Note 3) Issued privately placed investment units at an issue price of ¥500,000 (subscription price of ¥487,852) per investment unit to fund the acquisition of

new properties and repay loans. (Note 4) Issued privately placed investment units at an issue price of ¥500,000 per investment unit to fund the acquisition of new properties and repay loans. (Note 5) Issued investment units at an issue price of ¥550,000 (subscription price of ¥531,575) per investment unit to fund the acquisition of new properties

and repay loans. (Note 6) Issued investment units at an issue price of ¥712,530 (subscription price of ¥688,413) per investment unit to fund the acquisition of new properties

and repay loans. (Note 7) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥688,413 per investment unit. (Note 8) Carried out a four-for-one-split of investment units effective as of August 1, 2014, with July 31, 2014 as the record date. (Note 9) Issued investment units at an issue price of ¥266,253 (subscription price of ¥257,514) per investment unit to fund the acquisition of new properties

and repay loans. (Note 10) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥257,514 per investment unit. (Note 11) Issued investment units at an issue price of ¥195,828 (subscription price of ¥189,400) per investment unit to fund the acquisition of new properties

and repay loans. (Note 12) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥189,400 per investment unit. (Note 13) Issued investment units at an issue price of ¥243,252 (subscription price of ¥235,393) per investment unit to fund the acquisition of new properties

and repay loans. (Note 14) Issued investment units with Mizuho Securities Co., Ltd. as alottee at an issue value of ¥235,393 per investment unit. [Fluctuation in market price of the investment securities] The highest and lowest prices (closing price) in the real estate investment trust market of the Tokyo Stock Exchange, Inc., where the Investment Corporation is listed, by fiscal period are as follows.

Fiscal period 10th Fiscal Period 11th Fiscal Period 12th Fiscal Period 13th Fiscal Period 14th Fiscal Period Closing month/year Jul. 2015 Jan. 2016 Jul. 2016 Jan. 2017 Jul. 2017

Highest ¥266,300 ¥242,500 ¥250,900 ¥262,500 ¥261,600 Lowest ¥232,600 ¥189,600 ¥206,900 ¥231,600 ¥219,400

22 23


4. Performance of Distributions DPU for the 14th Fiscal Period was ¥4,681. The Investment Corporation has decided to distribute almost all unappropriated retained earnings after adding reversal of reserve for reduction entry, with the intent of including the maximum amount of earnings distributions in deductible expenses by applying special measures concerning taxation (Article 67-15 of the Act on Special Measures Concerning Taxation).

Fiscal period 10th Fiscal Period 11th Fiscal Period 12th Fiscal Period 13th Fiscal Period 14th Fiscal Period

Business period From Feb. 1, 2015 to Jul. 31, 2015

From Aug. 1, 2015 to Jan. 31, 2016

From Feb. 1, 2016 to Jul. 31, 2016

From Aug. 1, 2016 to Jan. 31, 2017

From Feb. 1, 2017 to Jul. 31, 2017

Unappropriated retained earnings ¥2,086,414 thousand ¥2,148,086 thousand ¥2,304,285 thousand ¥2,336,057 thousand ¥2,608,344 thousand Retained earnings ¥255 thousand ¥92,251 thousand ¥193 thousand ¥127 thousand ¥17 thousand Total distributions ¥2,086,159 thousand ¥2,055,835 thousand ¥2,304,092 thousand ¥2,335,929 thousand ¥2,638,651 thousand [Distribution per unit] [¥4,403] [¥4,339] [¥4,487] [¥4,549] [¥4,681] Of which, total earnings distributions ¥2,086,159 thousand ¥2,055,835 thousand ¥2,304,092 thousand ¥2,335,929 thousand ¥2,638,651 thousand

[Earnings distribution per unit] [¥4,403] [¥4,339] [¥4,487] [¥4,549] [¥4,681] Of which, total return on unitholders’ capital ¥– thousand ¥– thousand ¥– thousand ¥– thousand ¥– thousand

[Return on unitholders’ capital per unit] [¥–] [¥–] [¥–] [¥–] [¥–]

Of the total return on unitholders’ capital, the total distribution payments from the allowance for temporary difference adjustment

¥– thousand ¥– thousand ¥– thousand ¥– thousand ¥– thousand

[Of the return on unitholders’ capital per unit, the distribution payment from the allowance for temporary difference adjustment per unit]

[¥–] [¥–] [¥–] [¥–] [¥–]

Of the total return on unitholders’ capital, the total distribution payments from investments and other decreased distribution under tax laws

¥– thousand ¥– thousand ¥– thousand ¥– thousand ¥– thousand

[Of the total return on unitholders’ capital per unit, the distribution payments from investments and other decreased distribution under tax laws]

[¥–] [¥–] [¥–] [¥–] [¥–]

(Note) Figures above are rounded down to the nearest unit. 5. Future Investment Policy and Issues to Address

Based on our basic policies of investment management, the Investment Corporation acquired nine assets during the 14th Fiscal Period, and has carried out investment and management based on the concept and expertise incorporated into the urban rental residence “Comforia” series, which Tokyu Land Corporation (hereinafter referred to as “Tokyu Land”) has been producing. Going forward, we aim to achieve medium- to long-term growth by continuing to carry out investment and management based on our basic policies.

(1) External growth strategy The Investment Corporation aims to acquire higher-quality assets and expand its asset size, utilizing the support of the Tokyu Fudosan Holdings Group, primarily the sponsor support of Tokyu Land, and original information from TLC REIT Management Inc., its asset management company (hereinafter referred to as the “Asset Management Company”).

Specifically, we will acquire properties developed by our sponsor, Tokyu Land, using the sponsor support agreement the Asset Management Company entered into with Tokyu Land, and continuously and steadily acquire quality residential properties that are under stable operation. In addition, we intend to utilize real estate brokerage capabilities through the vast information network of Tokyu Fudosan Holdings Group companies, who are not our sponsors, to acquire quality residential properties, achieve stable operation and enhance profitability. Based on this perspective, the Asset Management Company has entered into a support agreement with each of the six support companies of the Tokyu Fudosan Holdings Group companies (Tokyu Livable, Inc., Tokyu Community Corp., Tokyu Housing Lease Corporation, Tokyu E-Life Design Inc., Ewel Inc., and Tokyu Sports Oasis, Inc.) for managed assets of the Investment Corporation. (Note) The Asset Management Company conducted, on April 1, 2017, an absorption-type merger with The Asset Management Company as the surviving

company and TLC Activa Investment Management Inc. as an absorbed company (hereinafter referred to as the “Merger”), and succeeded part of business with Tokyu Land Capital Management Inc. through an absorption-type split (hereinafter referred to as the “Corporation Split” and altogether with the Merger, the “Reorganization”). Furthermore, on April 1, 2017, the Asset Management Company changed its trade name from TLC Comforia Investment Management Inc. to TLC REIT Management Inc. in line with the Reorganization.

(2) Internal growth strategy With the aim of maximizing portfolio value and cash flows from individual properties from a medium- to long-term perspective and to make the most of the experience and comprehensive strength of the Tokyu Fudosan Holdings Group in property management, we will consign property management operations mainly to Tokyu Fudosan Holdings Group companies, which have extensive experience in the management of J-REITs and the “Comforia” series. In addition, we will strive for efficient management by examining the adequacy of building management specifications and costs.

Furthermore, we will actively utilize the expertise of Tokyu Fudosan Holdings Group in asset and fund management to achieve higher-quality overall management of the Investment Corporation.

In the 15th Fiscal Period and onwards, we will continue to aim to maintain and improve occupancy rates by closely monitoring the property management situation, as we did in the 14th Fiscal Period.

(3) Financial strategy

In consideration of addressing future interest rate risk and refinance risk, we will carry out funding activities by paying attention to financial soundness and earnings stability. With regard to debt, we will efficiently combine short-term funding that focuses on agility with long-term stable funding. Furthermore, we will consider the issuance of new investment units in accordance with financing needs for property acquisition and the financial situation of the Investment Corporation, while paying attention to the market development and distribution level, with the upper limit of the ratio of interest-bearing debt to total assets (LTV) at around 60%.

6. Significant Scheduled Events

Not applicable

24 25

Overview of the Investment Corporation

Overview of the Investment Corporation 1. Unitholders’ Capital

10th Fiscal Period

11th Fiscal Period

12th Fiscal Period

13th Fiscal Period

14th Fiscal Period

As of Jul. 31, 2015

As of Jan. 31, 2016

As of Jul. 31, 2016

As of Jan. 31, 2017

As of Jul. 31, 2017

Total number of authorized investment units (units) 8,000,000 8,000,000 8,000,000 8,000,000 8,000,000

Total number of investment units issued (units) 473,804 473,804 513,504 513,504 563,694

Unitholders’ capital (millions of yen) 75,224 75,224 82,743 82,743 94,557 Number of unitholders (people) 8,148 7,530 7,749 6,834 7,897

2. Matters concerning Investment Units

Major unitholders as of July 31, 2017 are as follows.

Name Number of investment units owned (units)

Ratio to the total number of investment units issued (%) (Note)

Japan Trustee Services Bank, Ltd. (trust account) 187,940 33.34 The Master Trust Bank of Japan, Ltd. (trust account) 52,784 9.36 Tokyu Land Corporation 51,664 9.16 Trust & Custody Services Bank, Ltd. (securities trust investment account) 31,219 5.53

The Nomura Trust & Banking Co., Ltd. (trust account) 22,803 4.04 Trust & Custody Services Bank, Ltd. (taxable trust money account) 10,748 1.90

The Asahi Fire And Marine Insurance Company Limited 8,600 1.52 Mitsubishi UFJ Trust and Banking Corporation (Standing proxy: The Master Trust Bank of Japan, Ltd.) 8,259 1.46

DFA INTERNATIONAL REAL ESTATE SECURITIES PORTFOLIO (Standing proxy: CITI BANK, N. A.) Tokyo Branch

5,632 0.99

STATE STREET BANK AND TRUST COMPANY 505012 (Standing proxy: The Hongkong and Shanghai Banking Corporation, Tokyo Branch)

5,251 0.93

Total 384,900 68.28 (Note) The ratio of investment units owned to the total number of investment units issued is rounded down to the second decimal place.

3. Matters concerning Directors, etc. (1) Name of directors, etc.

The names of directors, etc. during the 14th Fiscal Period are as follows.

Position Name of director, etc. Main concurrent posts Total amount of remuneration

paid during the period (thousands of yen)

Executive Director (Note 1)

Hiroyuki Tomata (Note 3)

President & CEO, TLC Comforia Investment Management INC. –

Takehiro Izawa (Note 3)

Executive Director, Chief Division Officer of Comforia Management Division, TLC REIT Management Inc.

–

Supervisory Director (Note 1)

Yoshihiro Kataoka Head of Kataoka & Kobayashi Outside Audit & Supervisory Board Member, The Higo Bank, Ltd.

1,800

Supervisory Director (Note 1)

Koji Yamamoto Partner, Shiki-Sogo Law and Accounting Office Supervisory Officer, Toshi Saisei Fund Investment Corporation

1,800

Independent Auditor

Ernst & Young ShinNihon LLC (Note 2)

– 18,828

(Note 1) None of the Executive Director or Supervisory Directors own investment units in the Investment Corporation, either in their own name or in someone else’s name. Furthermore, although Supervisory Directors may be officers of a corporation other than those mentioned above, neither one has an interest in the Investment Corporation.

(Note 2) The amount includes the fees pertaining to the production of an “Auditor’s Comfort Letter to Lead Underwriting Firm” related to the issuance of new investment units in February 2017 and the issuance of investment corporation bonds in July 2017.

(Note 3) Hiroyuki Tomata resigned as Executive Director of the Investment Corporation on March 31, 2017, and Substitute Executive Director Takehiro Izawa was appointed as a new Executive Director on April 1, 2017.

(2) Policy for decisions on dismissal or non-reappointment of Independent Auditor

The Board of Directors shall, with the consent of all its members, dismiss the Independent Auditor if it is deemed that it falls under any of the grounds set forth in each item of Paragraph 1 of Article 105 of the Investment Trusts Act, and when it is determined that there is no hope for improvement.

In addition, when it is determined that the Independent Auditor is not fit for its role, upon comprehensive examination of its execution of duties as the Independent Auditor and other various circumstances, the Board of Directors shall dismiss or not reappoint said Independent Auditor with the consent of all of its members, and forward a proposal for the appointment of a new Independent Auditor to the unitholders’ meeting.

(3) Disposition of suspension of services that the Independent Auditor has been subject to in the past two years

Details of the disciplinary action announced by the Financial Services Agency on December 22, 2015: (i) Subject of the action

Ernst & Young ShinNihon LLC (ii) Description of the action

– Three-month suspension from accepting new engagements (From January 1, 2016 to March 31, 2016)

– Order to improve operations (improvement of the audit management system) Note: In addition, an order for payment of a surcharge of approximately ¥2.1 billion was decided on January 22,

2016. (iii) Reason for the action

– Seven certified accountants from Ernst & Young ShinNihon LLC (hereinafter referred to as the “Auditor”) had, in negligence of due care, attested the financial statements of TOSHIBA CORPORATION for fiscal 2009, fiscal 2011 and fiscal 2012 (for years that ended March 31, 2010, 2012 and 2013) containing material misstatements as though no material misstatements were present.

– The Auditor’s operations were deemed significantly inappropriate 4. Asset Management Company, Asset Custodian and General Administration

The asset management company, asset custodian and general administration as of July 31, 2017 are as follows.

Consignment segment Name Asset management company TLC REIT Management Inc. Asset custodian Mitsubishi UFJ Trust and Banking Corporation General administration (unitholder registry administration) Mitsubishi UFJ Trust and Banking Corporation General administration (accounting service) Heiseikaikeisha Tax Corporation General administration (administrative service) Mitsubishi UFJ Trust and Banking Corporation General administration (corporation bond service) Sumitomo Mitsui Trust Bank, Limited

26 27

Status of Managed Assets of the Investment Corporation

Status of Managed Assets of the Investment Corporation 1. Composition of Assets of the Investment Corporation

Type of asset Area

13th Fiscal Period (as of January 31, 2017)

14th Fiscal Period (as of July 31, 2017)

Total amount owned (millions of yen) (Note 1)

Percentage of total assets (%) (Note 2)

Total amount owned (millions of yen) (Note 1)

Percentage of total assets (%) (Note 2)

Real estate

Sub-central Tokyo 3,215 1.7 3,201 1.6 Other major cities 1,058 0.6 1,050 0.5

Properties in trust

Central Tokyo 79,145 43.0 84,312 41.1 Sub-central Tokyo 74,758 40.7 83,107 40.5 Tokyo metropolitan area 3,686 2.0 4,713 2.3 Other major cities 7,682 4.2 12,675 6.2

Subtotal 169,546 92.2 189,060 92.2 Deposits and other assets 14,355 7.8 16,061 7.8 Total assets 183,902 100.0 205,121 100.0

(Note 1) “Total amount owned” shows the amount posted on the balance sheets as of the closing of accounts (the book value after depreciation for real estate and properties in trust).

(Note 2) The sum may not total 100.0% since figures are rounded to the first decimal place. 2. Major Assets Owned

The overview of major assets owned by the Investment Corporation (top 10 properties in terms of period-end book value) is as follows.

Property name Book value (millions of yen)

Rentable area (m2)

Rented area (m2)

Occupancy rate (%)

Ratio to total rental revenues

(%) Main usage

COMFORIA SHINJUKU EASTSIDE TOWER 13,884 48,267.60 45,916.97 95.1 19.7 Apartment

building

COMFORIA KAMATA 5,895 6,027.98 5,933.31 98.4 2.1 Apartment building

COMFORIA KOMABA 5,219 5,342.38 5,032.94 94.2 1.8 Apartment building

COMFORIA MINAMISUNAMACHI 4,719 6,141.98 5,918.53 96.4 1.8 Apartment

building COMFORIA AKIHABARA EAST 4,545 4,582.07 4,405.56 96.1 1.6 Apartment

building COMFORIA KITASANDO 4,275 4,968.40 4,699.28 94.6 1.9 Residence COMFORIA ITABASHINAKAJUKU 4,014 6,966.04 6,633.16 95.2 1.7 Apartment

building COMFORIA HIGASHIIKEBUKURO WEST 3,793 6,436.14 6,274.31 97.5 2.2 Apartment

building

COMFORIA HARAJYUKU 3,540 4,528.51 4,452.53 98.3 1.7 Apartment building

COMFORIA TAMACHI 3,420 4,251.63 4,067.43 95.7 1.3 Apartment building

Total 53,308 97,512.73 93,334.02 95.7 35.8

3. Statement of Properties Incorporated in the Portfolio The overview of assets under management of the Investment Corporation as of July 31, 2017 is as follows.

Area Property name Address Ownership form

Appraisal value at end of period (millions of yen)

(Note 1)

Book value (millions of yen)

(Note 2)

Cent

ral T

okyo

COMFORIA NIHONBASHI NINGYOCHO 3-5-10 Nihonbashi Ningyocho, Chuo-ku, Tokyo

Beneficial interest in real

estate trust 2,100 1,555

COMFORIA WASEDA 147 Bentencho, Shinjuku-ku, Tokyo Beneficial

interest in real estate trust

2,470 1,894

COMFORIA SHIMOOCHIAI 2-7-10 Nakaochiai, Shinjuku-ku, Tokyo Beneficial


1,520 1,123

COMFORIA HIGASHINAKANO 4-34-2 Kita-Shinjuku, Shinjuku-ku, Tokyo Beneficial


669 556

COMFORIA GINZA EAST 1-3-1 Irifune, Chuo-ku, Tokyo Beneficial


3,940 3,030

COMFORIA AZABUDAI 3-4-4 Azabudai, Minato-ku, Tokyo Beneficial


755 561

COMFORIA SHIBAKOEN 2-2-15 Shibakoen, Minato-ku, Tokyo Beneficial


1,690 1,345

COMFORIA NISHIAZABU 4-1-10 Nishiazabu, Minato-ku, Tokyo Beneficial


927 736

COMFORIA MINAMIAOYAMA 4-1-12 Minami-Aoyama, Minato-ku, Tokyo Beneficial


1,490 1,064

COMFORIA MINAMIAOYAMA DEUX 4-2-1 Minami-Aoyama, Minato-ku, Tokyo


estate trust 382 247

COMFORIA NISHIWASEDA 1-5-19 Takadanobaba, Shinjuku-ku, Tokyo Beneficial


2,040 1,624

COMFORIA HARAJYUKU 3-61-3 Sendagaya, Shibuya-ku, Tokyo Beneficial


4,590 3,540

COMFORIA MITA NORTH 2-7-16 Mita, Minato-ku, Tokyo Beneficial


1,070 865

COMFORIA SHIBAURA BOWHOUSE 3-13-12 Kaigan, Minato-ku, Tokyo



COMFORIA SHIROKANETAKANAWA 5-1-21 Mita, Minato-ku, Tokyo



COMFORIA NIHONBASHI NINGYOCHO EAST 3-6-3 Nihonbashi Ningyocho, Chuo-ku, Tokyo



COMFORIA ATAGO 3-23-7 Toranomon, Minato-ku, Tokyo Beneficial


940 823

COMFORIA KUDAN 2-6-12 Kudan Minami, Chiyoda-ku, Tokyo Beneficial


1,500 1,277

COMFORIA NIHONBASHI NINGYOCHO NORTH 1-1-6 Nihonbashi Horidomecho, Chuo-ku, Tokyo



COMFORIA SHINKAWA 2-15-5 Shinkawa, Chuo-ku, Tokyo Beneficial


2,150 1,827

COMFORIA AKASAKA 2-17-63 Akasaka, Minato-ku, Tokyo Beneficial


2,470 1,944

COMFORIA MITA EAST 4-18-1 Shiba, Minato-ku, Tokyo Beneficial


3,660 3,154

28 29




(Note 1)


(Note 2)

Cent

ral T

okyo

COMFORIA SHIBAURA CANAL 3-1-9 Kaigan, Minato-ku, Tokyo Beneficial


1,880 1,554

COMFORIA KITASANDO 4-5-10 Sendagaya, Shibuya-ku, Tokyo Beneficial


4,990 4,275

COMFORIA YOYOGIUEHARA 2-31-5 Uehara, Shibuya-ku, Tokyo Beneficial


1,810 1,556

COMFORIA SASAZUKA 1-59-10 Sasazuka, Shibuya-ku, Tokyo Beneficial


2,200 1,789

COMFORIA SHINJUKUGYOEN II 1-13-3 Shinjuku, Shinjuku-ku, Tokyo Beneficial


2,150 1,795

COMFORIA ICHIGAYAYANAGICHO 18-2 Ichigaya Yanagicho, Shinjuku-ku, Tokyo



COMFORIA KAGURAZAKA 26-1 Iwatocho, Shinjuku-ku, Tokyo Beneficial


843 731

COMFORIA NIBANCHO 4-8 Nibancho, Chiyoda-ku, Tokyo Beneficial


1,840 1,638

COMFORIA NISHISHINJUKU 1-20-12 Kita-Shinjuku, Shinjuku-ku, Tokyo Beneficial


1,710 1,648

COMFORIA KANDAJINBOCHO 1-42-2 Kanda Jinbocho, Chiyoda-ku, Tokyo Beneficial


1,580 1,500

COMFORIA NIHONBASHI 1-2-2 Nihonbashi Bakurocho, Chuo-ku, Tokyo Beneficial


2,150 1,989

COMFORIA TAMACHI 4-5-13 Shibaura, Minato-ku, Tokyo Beneficial


3,600 3,420

COMFORIA AZABUJUBAN 1-2-15 Mita, Minato-ku, Tokyo Beneficial


1,620 1,492

COMFORIA SHINJUKUGYOEN I 1-10-4 Shinjuku, Shinjuku-ku, Tokyo Beneficial


1,500 1,427

COMFORIA KAGURAZAKA DEUX 7-3 Iwatocho, Shinjuku-ku, Tokyo



COMFORIA AZABU EAST 2-29-1 Higashi-Azabu, Minato-ku, Tokyo Beneficial


2,770 1,939

COMFORIA SHINJUKU EASTSIDE TOWER

(Tower Building) 6-27-29 Shinjuku, Shinjuku-ku, Tokyo (Annex Building) 6-27-28 Shinjuku, Shinjuku-ku, Tokyo (Gate Building) 6-27-14 Shinjuku, Shinjuku-ku, Tokyo



COMFORIA ICHIGAYAYAKUOJI 74-23 Ichigayayakuojimachi, Shinjuku-ku, Tokyo Beneficial


970 998

COMFORIA AKIHABARA EAST 2-9-19 Higashikanda, Chiyoda-ku, Tokyo Beneficial


4,590 4,545

COMFORIA MITA TROIS 3-43-6 Shiba, Minato-ku, Tokyo Beneficial


894 945

Subtotal 98,290 84,312



(Note 1)


(Note 2)

Sub-

cent

ral T

okyo

COMFORIA BUNKYOKASUGA 1-15-12 Nishikata, Bunkyo-ku, Tokyo Beneficial


2,000 1,403

COMFORIA ASAKUSAMATSUGAYA 1-11-5 Matsugaya, Taito-ku, Tokyo


estate trust 1,230 854

COMFORIA NISHIOI 6-6-1 Nishi-Oi, Shinagawa-ku, Tokyo Beneficial


1,030 889

COMFORIA NAKANO 2-40-12 Kamitakada, Nakano-ku, Tokyo Beneficial


993 876

COMFORIA SHIMOKITAZAWA 1-9-14 Hanegi, Setagaya-ku, Tokyo Beneficial


3,260 2,448

COMFORIA NISHIKAMATA 6-37-3 Nishi-Kamata, Ota-ku, Tokyo Beneficial


2,100 1,475

COMFORIA OYAMA 4-4 Oyamacho, Itabashi-ku, Tokyo Beneficial


2,320 1,967

COMFORIA KIYOSUMISHIRAKAWA SOUTH 3-2-13 Miyoshi, Koto-ku, Tokyo



COMFORIA KOMAZAWA 2-1-5 Komazawa, Setagaya-ku, Tokyo Beneficial


1,640 1,243

COMFORIA KOISHIKAWA 2-17-27 Koishikawa, Bunkyo-ku, Tokyo Beneficial


665 532

COMFORIA SENGOKU 4-3-20 Sengoku, Bunkyo-ku, Tokyo Beneficial


1,690 1,206

COMFORIA DAIKANYAMAAOBADAI 2-1-7 Aobadai, Meguro-ku, Tokyo



COMFORIA IKEBUKURO 2-57-1 Ikebukuro, Toshima-ku, Tokyo Beneficial


671 580

COMFORIA RYOGOKUISHIWARA 1-36-1 Ishiwara, Sumida-ku, Tokyo



COMFORIA ASAKUSABASHI DEUX 5-24-10 Asakusabashi, Taito-ku, Tokyo



COMFORIA OSHIAGE 4-7-2 Narihira, Sumida-ku, Tokyo Beneficial


820 708

COMFORIA HONJOAZUMABASHI 2-11-12 Honjo, Sumida-ku, Tokyo



COMFORIA KIYOSUMISHIRAKAWA TROIS 3-5-14 Shirakawa, Koto-ku, Tokyo



COMFORIA MONZENNAKACHO 16-8 Fuyuki, Koto-ku, Tokyo Beneficial


2,960 2,579

COMFORIA HIMONYA 2-3-3 Himonya, Meguro-ku, Tokyo Beneficial


1,560 1,194

COMFORIA MISYUKU 3-23-2 Ikejiri, Setagaya-ku, Tokyo Beneficial


2,430 1,828

COMFORIA GAKUGEIDAIGAKU 6-46-6 Shimouma, Setagaya-ku, Tokyo Beneficial


1,460 1,129

COMFORIA HIGASHINAKANO DEUX 4-2-19 Higashi-Nakano, Nakano-ku, Tokyo



30 31




(Note 1)


(Note 2)

Sub-

cent

ral T

okyo

COMFORIA HIGASHIIKEBUKURO WEST 3-22-21 Higashi-Ikebukuro, Toshima-ku, Tokyo



COMFORIA RYOGOKU DEUX 1-2-10 Chitose, Sumida-ku, Tokyo Beneficial


1,230 1,026

COMFORIA OMORI DEUX 3-4-2 Omori Kita, Ota-ku, Tokyo Beneficial


1,380 1,201

COMFORIA MACHIYA 5-51-7 Arakawa, Arakawa-ku, Tokyo Beneficial


842 603

COMFORIA ASAKUSABASHI 2-20-10 Yanagibashi, Taito-ku, Tokyo Beneficial


3,430 2,625

COMFORIA RYOGOKU SOUTH 2-14-8 Chitose, Sumida-ku, Tokyo Beneficial


1,590 1,216

COMFORIA TOYOSU 1-4-12 Edagawa, Koto-ku, Tokyo Beneficial


3,700 3,029

COMFORIA SUMIDA-TACHIBANA 5-18-5 Tachibana, Sumida-ku, Tokyo



COMFORIA UENOHIROKOJI 3-17-4 Ueno, Taito-ku, Tokyo Beneficial


1,230 1,047

COMFORIA KASUGATOMISAKA 1-11-18 Kasuga, Bunkyo-ku, Tokyo Beneficial


3,420 2,891

COMFORIA HONKOMAGOME 2-29-24 Honkomagome, Bunkyo-ku, Tokyo Beneficial


1,640 1,330

COMFORIA MORISHITA 3-6-8 Shin-Ohashi, Koto-ku, Tokyo Beneficial


1,750 1,509

COMFORIA KIBAKOEN 2-17-7 Kiba, Koto-ku, Tokyo Beneficial


1,100 944

COMFORIA MEGURO CHOJAMARU 2-6-25 Kami-Osaki, Shinagawa-ku, Tokyo



COMFORIA NISHIMAGOME 2-35-8 Nishi-Magome, Ota-ku, Tokyo Beneficial


1,120 988

COMFORIA HIGASHIIKEBUKURO EAST 2-8-1 Higashi-Ikebukuro, Toshima-ku, Tokyo



COMFORIA HIGASHIIKEBUKURO 4-3-5 Higashi-Ikebukuro, Toshima-ku, Tokyo



COMFORIA KOMABA 4-8-25 Ikejiri, Setagaya-ku, Tokyo Beneficial


5,310 5,219

COMFORIA KINSHICHO 3-8-6 Taihei, Sumida-ku, Tokyo Beneficial


1,160 1,065

COMFORIA MINAMISUNAMACHI 4-4-20 Minamisuna, Koto-ku, Tokyo





(Note 1)


(Note 2)

Sub-

cent

ral T

okyo

COMFORIA HIGASHISHINAGAWA

3-22-11 Higashi-Shinagawa, Shinagawa-ku, Tokyo

Beneficial interest in real estate trust 1,660 1,554

COMFORIA MEGUROYAKUMO 1-12-10 Yakumo, Meguro-ku, Tokyo Beneficial interest

in real estate trust 863 832

COMFORIA YOGA 3-24-3 Yoga, Setagaya-ku, Tokyo Beneficial interest in real estate trust 1,100 1,090

COMFORIA ITABASHINAKAJUKU 62-2 Nakajuku, Itabashi-ku, Tokyo Beneficial interest

in real estate trust 4,120 4,014

COMFORIA SHINAGAWA EAST 1-20-8 Kitashinagawa, Shinagawa-ku, Tokyo Beneficial interest


COMFORIA OJIMA 4-8-10 Ojima, Koto-ku, Tokyo Real estate 2,170 2,269 COMFORIA OMORI TROIS 3-36-7 Omorikita, Ota-ku, Tokyo Real estate 905 932 COMFORIA BUNKYO HAKUSAN 1-3-2 Honkomagome, Bunkyo-ku, Tokyo Beneficial interest


COMFORIA KAMATA 4-21-2 Kamata, Ota-ku, Tokyo Beneficial interest in real estate trust 5,880 5,895

COLLEGE COURT HACHIMANYAMA 1-15-1 Kamitakaido, Suginami-ku, Tokyo Beneficial interest


Subtotal 100,735 86,309

Toky

o m

etro

polit

an a

rea

COMFORIA KOMAE 3-9-5 Iwato Kita, Komae-shi, Tokyo Beneficial interest in real estate trust 559 422

COMFORIA YOKOHAMAKANNAI

2-8-15 Okinacho, Naka-ku, Yokohama-shi, Kanagawa

Beneficial interest in real estate trust 1,270 935

COMFORIA ICHIKAWAMYODEN 1-9-10 Shioyaki, Ichikawa-shi, Chiba Beneficial interest

in real estate trust 726 612

COMFORIA YATSUKA 3-38-3 Sezaki, Soka-shi, Saitama Beneficial interest in real estate trust 688 626

COMFORIA SHINKOYASU 2-216-2 Koyasudori, Kanagawa-ku, Yokohama-shi, Kanagawa


COMFORIA GYOTOKU 2-1-13 Gyotokuekimae, Ichikawa-shi, Chiba Beneficial interest in real estate trust 992 1,049

Subtotal 5,475 4,713

Oth

er m

ajor

citi

es

COMFORIA SHIN-OSAKA 1-21-24 Higashi-Nakajima, Higashi-Yodogawa-ku, Osaka-shi, Osaka


COMFORIA SHINSAKAE 2-28-18 Shinsakae, Naka-ku, Nagoya-shi, Aichi Beneficial interest in real estate trust 1,810 1,697

COMFORIA KITAHORIE 3-12-2 Kita-Horie, Nishi-ku, Osaka-shi, Osaka Real estate 1,080 1,050

COMFORIA KITASANJO 2-2-51 Kita-Sanjo Higashi, Chuo-ku, Sapporo-shi, Hokkaido

Beneficial interest in real estate trust 940 686

COMFORIA SAPPORO SHOKUBUTSUEN

10-1-6 KitaNijo-Nishi, Chuo-ku, Sapporo-shi, Hokkaido


COMFORIA OGIMACHI 3-7-15 Tenjinbashi, Kita-ku, Osaka-shi, Osaka Beneficial interest in real estate trust 1,530 1,537

COMFORIA SHINSAIBASHI EAST 2-6-8 Bakuromachi, Chuo-ku, Osaka-shi, Osaka Beneficial interest


COMFORIA KYOMACHIBORI 1-16-14 Kyomachibori, Nishi-ku, Osaka-shi, Osaka Beneficial interest in real estate trust 1,600 1,629

COMFORIA AWAZA 1-5-5 Enokojima, Nishi-ku, Osaka-shi, Osaka Beneficial interest in real estate trust 1,330 1,351

Subtotal 14,380 13,725 Total 218,880 189,060

(Note 1) “Appraisal value at end of period” indicates the appraisal value by a real estate appraiser (based on real estate appraisal reports or research reports prepared by the Japan Real Estate Institute, Daiwa Real Estate Appraisal Co., Ltd., The Tanizawa Sōgō Appraisal Co., Ltd., Morii Appraisal & Investment Consulting, Inc. and Japan Valuers Co., Ltd., with the account closing date as the date of value estimate), pursuant to the method of asset appraisal stipulated in the Articles of Incorporation of the Investment Corporation as well as the “Ordinance on Accountings of Investment Corporations” (Cabinet Office Ordinance No. 47 of 2006).

(Note 2) “Book value” indicates the acquisition price (including miscellaneous expenses related to the acquisition) as of the end of the 14th Fiscal Period (July 31, 2017) minus accumulated depreciation, and does not include construction in progress or construction in progress in trust.

32 33


The overview of the rental business by assets under management of the Investment Corporation is as follows.

Area Property name

13th Fiscal Period (from August 1, 2016 to January 31, 2017)

14th Fiscal Period (from February 1, 2017 to July 31, 2017)

Total number of tenants

(at end of period) (Note 1)

Occupancy rate

(at end of period) (%)

(Note 2)

Rental revenue (during period) (thousands of yen)

Ratio to total rental

revenues (%)



Occupancy rate (at end of period)

(%) (Note 2)

Rent revenue (during period) (thousands of yen)

Ratio to total

rental revenues

(%)

Cent

ral T

okyo

COMFORIA NIHONBASHI NINGYOCHO 1 95.5 58,027 0.9 1 94.0 56,667 0.8

COMFORIA WASEDA 1 99.0 67,345 1.0 1 90.1 67,077 0.9 COMFORIA SHIMOOCHIAI 1 95.9 47,498 0.7 1 98.2 48,067 0.7 COMFORIA HIGASHINAKANO 1 91.3 21,205 0.3 1 94.5 20,792 0.3 COMFORIA GINZA EAST 1 97.9 115,722 1.7 1 98.3 113,928 1.6 COMFORIA AZABUDAI 1 100.0 22,108 0.3 1 90.1 22,145 0.3 COMFORIA SHIBAKOEN 1 98.4 49,720 0.7 1 94.5 50,536 0.7 COMFORIA NISHIAZABU 1 91.3 26,129 0.4 1 91.6 24,882 0.3 COMFORIA MINAMIAOYAMA 1 76.3 34,101 0.5 1 100.0 33,140 0.5 COMFORIA MINAMIAOYAMA DEUX 1 100.0 11,388 0.2 1 100.0 12,044 0.2

COMFORIA NISHIWASEDA 1 98.2 62,249 0.9 1 94.7 59,941 0.8 COMFORIA HARAJYUKU 1 96.5 124,199 1.9 1 98.3 127,156 1.7 COMFORIA MITA NORTH 1 96.2 29,943 0.4 1 100.0 29,937 0.4 COMFORIA SHIBAURA BOWHOUSE

1 98.7 97,386 1.5 1 98.7 98,067 1.3

COMFORIA SHIROKANETAKANAWA 1 97.5 44,041 0.7 1 89.8 43,738 0.6

COMFORIA NIHONBASHI NINGYOCHO EAST 1 95.3 64,934 1.0 1 98.2 67,292 0.9

COMFORIA ATAGO 1 97.5 28,798 0.4 1 97.5 28,656 0.4 COMFORIA KUDAN 1 93.9 39,678 0.6 1 97.2 40,168 0.6 COMFORIA NIHONBASHI NINGYOCHO NORTH 1 97.2 36,520 0.5 1 100.0 37,147 0.5

COMFORIA SHINKAWA 1 100.0 60,226 0.9 1 96.7 59,393 0.8 COMFORIA AKASAKA 1 92.5 60,889 0.9 1 95.1 63,703 0.9 COMFORIA MITA EAST 1 97.6 97,562 1.5 1 97.0 98,441 1.4 COMFORIA SHIBAURA CANAL 1 97.9 53,200 0.8 1 96.8 53,207 0.7 COMFORIA KITASANDO 1 96.3 135,908 2.0 1 94.6 135,856 1.9 COMFORIA YOYOGIUEHARA 1 98.2 50,340 0.8 1 98.4 49,264 0.7 COMFORIA SASAZUKA 1 100.0 67,354 1.0 1 96.8 66,960 0.9 COMFORIA SHINJUKUGYOEN II 1 96.8 56,745 0.9 1 100.0 57,330 0.8 COMFORIA ICHIGAYAYANAGICHO 1 97.8 46,649 0.7 1 96.2 50,044 0.7

COMFORIA KAGURAZAKA 1 97.1 23,012 0.3 1 97.0 23,959 0.3 COMFORIA NIBANCHO 1 100.0 50,700 0.8 1 93.3 49,802 0.7 COMFORIA NISHISHINJUKU 1 91.7 45,605 0.7 1 94.8 47,453 0.7 COMFORIA KANDAJINBOCHO 1 100.0 42,677 0.6 1 88.9 43,567 0.6 COMFORIA NIHONBASHI 1 95.7 61,781 0.9 1 98.6 62,277 0.9 COMFORIA TAMACHI 1 98.7 97,959 1.5 1 95.7 98,190 1.3 COMFORIA AZABUJUBAN 1 98.2 41,177 0.6 1 96.4 42,294 0.6 COMFORIA SHINJUKUGYOEN I 1 94.8 42,467 0.6 1 89.6 41,628 0.6 COMFORIA KAGURAZAKA DEUX 1 100.0 39,726 0.6 1 100.0 40,511 0.6

COMFORIA AZABU EAST 1 96.6 70,881 1.1 1 95.5 73,991 1.0 COMFORIA SHINJUKU EASTSIDE TOWER 1 95.2 1,425,036 21.4 1 95.1 1,434,472 19.7

COMFORIA ICHIGAYAYAKUOJI 1 84.0 6,102 0.1 1 100.0 23,998 0.3 COMFORIA AKIHABARA EAST - - - - 1 96.1 115,481 1.6 COMFORIA MITA TROIS - - - - 1 91.1 22,533 0.3

Subtotal 2 96.1 3,557,008 53.3 2 95.8 3,735,750 51.3

Area Property name





Occupancy rate


(Note 2)



revenues (%)



Occupancy rate


(Note 2)



revenues (%)

Sub-

cent

ral T

okyo

COMFORIA BUNKYOKASUGA 1 98.3 60,015 0.9 1 98.1 60,244 0.8 COMFORIA ASAKUSAMATSUGAYA

1 94.3 44,652 0.7 1 97.9 44,920 0.6

COMFORIA NISHIOI 1 98.3 31,637 0.5 1 98.3 31,582 0.4 COMFORIA NAKANO 1 98.2 30,506 0.5 1 91.5 32,984 0.5 COMFORIA SHIMOKITAZAWA 1 96.3 91,230 1.4 1 95.5 95,662 1.3 COMFORIA NISHIKAMATA 1 95.0 66,110 1.0 1 95.9 65,083 0.9 COMFORIA OYAMA 1 97.1 79,025 1.2 1 95.3 77,786 1.1 COMFORIA KIYOSUMISHIRAKAWA SOUTH 1 97.8 27,833 0.4 1 93.3 28,652 0.4

COMFORIA KOMAZAWA 1 97.6 42,986 0.6 1 94.0 42,563 0.6 COMFORIA KOISHIKAWA 1 100.0 21,081 0.3 1 100.0 21,553 0.3 COMFORIA SENGOKU 1 95.4 51,653 0.8 1 97.5 53,608 0.7 COMFORIA DAIKANYAMAAOBADAI 1 97.4 36,342 0.5 1 100.0 35,235 0.5

COMFORIA IKEBUKURO 1 100.0 22,281 0.3 1 96.5 22,024 0.3 COMFORIA RYOGOKUISHIWARA 1 100.0 25,590 0.4 1 100.0 28,739 0.4

COMFORIA ASAKUSABASHI DEUX 1 98.1 30,497 0.5 1 100.0 30,531 0.4

COMFORIA OSHIAGE 1 100.0 25,853 0.4 1 100.0 26,498 0.4 COMFORIA HONJOAZUMABASHI 1 100.0 27,604 0.4 1 98.2 28,227 0.4

COMFORIA KIYOSUMISHIRAKAWA TROIS 1 100.0 31,208 0.5 1 98.0 31,523 0.4

COMFORIA MONZENNAKACHO 1 97.9 90,973 1.4 1 99.3 90,774 1.2

COMFORIA HIMONYA 1 100.0 41,548 0.6 1 94.0 42,836 0.6 COMFORIA MISYUKU 1 100.0 65,741 1.0 1 93.4 64,867 0.9 COMFORIA GAKUGEIDAIGAKU 1 95.4 40,696 0.6 1 92.2 40,017 0.5

COMFORIA HIGASHINAKANO DEUX 1 97.9 30,291 0.5 1 90.1 30,522 0.4

COMFORIA HIGASHIIKEBUKURO WEST 1 97.6 157,968 2.4 1 97.5 159,543 2.2

COMFORIA RYOGOKU DEUX 1 98.7 36,961 0.6 1 98.7 36,936 0.5 COMFORIA OMORI DEUX 1 91.3 39,165 0.6 1 92.8 39,007 0.5 COMFORIA MACHIYA 1 100.0 25,721 0.4 1 97.0 26,349 0.4 COMFORIA ASAKUSABASHI 1 97.9 101,868 1.5 1 96.9 100,949 1.4 COMFORIA RYOGOKU SOUTH 1 94.5 47,071 0.7 1 98.7 47,653 0.7 COMFORIA TOYOSU 1 97.6 97,291 1.5 1 97.7 100,791 1.4 COMFORIA SUMIDA-TACHIBANA 1 92.3 31,265 0.5 1 100.0 32,125 0.4

COMFORIA UENOHIROKOJI 1 96.5 32,982 0.5 1 97.6 34,041 0.5 COMFORIA KASUGATOMISAKA 1 100.0 90,915 1.4 1 95.7 90,431 1.2

COMFORIA HONKOMAGOME 1 100.0 47,038 0.7 1 100.0 44,597 0.6 COMFORIA MORISHITA 1 100.0 49,458 0.7 1 97.3 49,531 0.7 COMFORIA KIBAKOEN 1 96.7 32,225 0.5 1 98.3 33,553 0.5 COMFORIA MEGURO CHOJAMARU 1 90.4 70,853 1.1 1 98.6 69,316 1.0

COMFORIA NISHIMAGOME 1 93.8 30,889 0.5 1 98.1 31,687 0.4 COMFORIA HIGASHIIKEBUKURO EAST 1 95.4 67,852 1.0 1 95.7 66,998 0.9

COMFORIA HIGASHIIKEBUKURO 1 100.0 38,003 0.6 1 98.0 37,179 0.5

COMFORIA KOMABA 1 99.0 133,955 2.0 1 94.2 131,338 1.8 COMFORIA KINSHICHO 1 98.2 34,401 0.5 1 98.1 34,067 0.5 COMFORIA MINAMISUNAMACHI 1 93.9 130,707 2.0 1 96.4 131,837 1.8

COMFORIA HIGASHISHINAGAWA 1 100.0 51,568 0.8 1 98.2 51,393 0.7

COMFORIA MEGUROYAKUMO 1 94.1 26,876 0.4 1 92.0 26,138 0.4

34 35


Area Property name





Occupancy rate


(Note 2)



revenues (%)



Occupancy rate (at end of period)

(%) (Note 2)


Ratio to total

rental revenues

(%)

Sub-

cent

ral T

okyo

COMFORIA YOGA 1 97.8 30,376 0.5 1 90.5 31,314 0.4 COMFORIA ITABASHINAKAJUKU

1 97.0 120,725 1.8 1 95.2 120,332 1.7

COMFORIA SHINAGAWA EAST 1 97.2 70,095 1.1 1 100.0 78,351 1.1 COMFORIA OJIMA 1 97.0 55,421 0.8 1 95.0 60,146 0.8 COMFORIA OMORI TROIS 1 96.0 22,598 0.3 1 96.0 24,980 0.3 COMFORIA BUNKYOHAKUSAN - - - - 1 97.0 37,316 0.5 COMFORIA KAMATA - - - - 1 98.4 151,874 2.1 COLLEGE COURT HACHIMANYAMA - - - - 1 100.0 30,046 0.4

Subtotal 1 97.2 2,689,625 40.3 2 96.7 2,936,272 40.4

Toky

o m

etro

polit

an

area

COMFORIA KOMAE 1 94.8 18,667 0.3 1 97.1 19,489 0.3 COMFORIA YOKOHAMAKANNAI 1 100.0 41,631 0.6 1 96.7 42,262 0.6

COMFORIA ICHIKAWAMYODEN 1 94.0 24,649 0.4 1 94.0 24,960 0.3 COMFORIA YATSUKA 1 90.3 27,659 0.4 1 96.8 26,874 0.4 COMFORIA SHINKOYASU 1 97.1 35,711 0.5 1 100.0 38,034 0.5 COMFORIA GYOTOKU - - - - 1 96.6 9,126 0.1

Subtotal 1 95.6 148,319 2.2 1 97.1 160,747 2.2

Oth

er m

ajor

citi

es

COMFORIA SHIN-OSAKA 1 97.7 89,120 1.3 1 92.0 88,106 1.2 COMFORIA SHINSAKAE 1 91.1 56,695 0.8 1 90.1 56,284 0.8 COMFORIA KITAHORIE 1 94.8 31,163 0.5 1 98.7 33,091 0.5 COMFORIA KITASANJO 1 96.7 35,546 0.5 1 98.9 36,003 0.5 COMFORIA SAPPORO SHOKUBUTSUEN 1 92.9 38,850 0.6 1 97.7 39,752 0.5

COMFORIA OGIMACHI 1 94.8 27,950 0.4 1 94.5 40,989 0.6 COMFORIA SHINSAIBASHI EAST - - - - 1 94.1 60,578 0.8

COMFORIA KYOMACHIBORI - - - - 1 97.6 47,125 0.6 COMFORIA AWAZA - - - - 1 96.5 42,073 0.6

Subtotal 1 95.0 279,326 4.2 1 94.9 444,005 6.1 Total 2 96.5 6,674,280 100.0 3 96.1 7,276,775 100.0

(Note 1) “Total number of tenants” indicates the total number of tenants under a direct lease relationship with the Investment Corporation or the trustee (including tenants planned to have lease relationship). Therefore, in cases where the Investment Corporation or trustee comprehensively leases all of the rooms for rent from each managed property to the master lease company (hereinafter referred to as the “introduction of a master lease”), and said master lease company subleases each room for rent to end tenants, the total number of tenants will be shown as “1,” and will not include the number of end tenants related to the said sublease. Tokyu Housing Lease Corporation, Mitsubishi Real Estate Services Co., Ltd. and MAINICHICOMNET Co., Ltd. are the three master lease companies hired by the Investment Corporation for its assets under management; therefore, the sum of the total number of tenants and subtotal of the total number of tenants in Central Tokyo is set as “3.” Even for managed assets where a master lease is introduced, end tenants who do not accept the introduction of a master lease will be under a direct lease relationship with the Investment Corporation or trustee. However, the number of said end tenants is not included in the total number of tenants.

(Note 2) “Occupancy rate” is the percentage of rented area vs. the rentable area of each managed asset.

4. Statement of Renewable Energy Power Generation Facilities Not applicable

5. Statement of Operational License of Public Facilities

Not applicable 6. Statement of Securities Incorporated in the Portfolio

Not applicable 7. Details of Specified Transactions

The amount of specified derivative transactions entered into by the Investment Corporation and fair value as of July 31, 2017 are as follows.

Segment Type Contract amount (millions of yen) Fair value

(millions of yen) (Note 2)

(Note 1) Over 1 year

Over-the-counter transactions

Receive floating, pay fixed interest-rate swap

transactions 55,645 48,745 –

Total 55,645 48,745 – (Note 1) The contract amount of the interest-rate swap transactions is based on the notional principal. (Note 2) The fair value was calculated by the counterparty of the relevant transaction based on the actual market interest rate. The fair value is omitted for

transactions that meet the requirements for special treatment pursuant to the Accounting Standard for Financial Instruments. 8. Other Assets

Trust beneficial interests in properties owned by the Investment Corporation are listed on the aforementioned “3. Statement of Properties Incorporated in the Portfolio.” As of the end of the 14th Fiscal Period, there is no incorporation in particular of specified assets as principal investment targets by the Investment Corporation, other than assets in the aforementioned “3. Statement of Properties Incorporated in the Portfolio,” “4. Statement of Renewable Energy Power Generation Facilities,” “5. Statement of Operational License of Public Facilities” and “6. Statement of Securities Incorporated in the Portfolio.”

9. Ownership of Assets by Country and Region

Not applicable for countries and regions other than Japan

36 37

Status of Expenses and LiabilitiesCapital Expenditure for Properties Owned

Capital Expenditure for Properties Owned 1. Expected Capital Expenditure

Major capital expenditure that accompanies repair works currently planned for assets already acquired (includes assets under management that were acquired after the account closing date) is as follows. The following expected amount of construction work includes portions that are separately accounted under expenses.

Property name (location) Purpose Scheduled period

Expected amount of construction work (thousands of yen)

Total amount Payment for the period

Total amount already paid

COMFORIA HARAJYUKU (Shibuya-ku, Tokyo) Large-scale repair work From Aug. 2017

to Dec. 2017 73,900 －－

COMFORIA SENGOKU (Bunkyo-ku, Tokyo) Large-scale repair work From Sept. 2017

to Dec. 2017 59,300 －－

COMFORIA YOYOGIUEHARA (Shibuya-ku, Tokyo)

Large-scale repair work From Sept. 2017 to Dec. 2017 56,500 －－

COMFORIA SHINJUKU EASTSIDE TOWER (Shinjuku-ku, Tokyo)

Renovation of guest rooms From Nov. 2017 to Nov. 2017 8,200 －－

COMFORIA SHINJUKU EASTSIDE TOWER (Shinjuku-ku, Tokyo)

Replacement of MB aerator From Nov. 2017 to Nov. 2017 5,700 －－

2. Capital Expenditure during the Period

The overview of main construction works corresponding to capital expenditure that took place in the 14th Fiscal Period for the managed assets owned as of the end of the period is as follows. Capital expenditure during the 14th Fiscal Period was ¥386,536 thousand. Together with repair expenses of ¥282,191 thousand that were classified as expenses for the 14th Fiscal Period, construction works totaling ¥668,727 thousand were carried out.

Property name (location) Purpose Period Construction cost

(thousands of yen) COMFORIA ITABASHINAKAJUKU (Itabashi-ku, Tokyo) Large-scale repair work From Mar. 2017

to Jul. 2017 144,355

COMFORIA GINZA EAST (Chuo-ku, Tokyo) Large-scale repair work From Feb. 2017

to Jul. 2017 89,469

COMFORIA MINAMIAOYAMA (Minato-ku, Tokyo) Conversion of a shop section into an office From Mar. 2017

to Apr. 2017 27,075

COMFORIA HIGASHISHINAGAWA (Shinagawa-ku, Tokyo) Electric water heater replacement work From Apr. 2017

to Jul. 2017 13,592

COMFORIA ICHIGAYAYANAGICHO (Shinjuku-ku, Tokyo) Entrance improvement work From May 2017

to Jul. 2017 9,182

Other properties, etc. Painting of iron section in common area, etc. From Feb. 2017 to Jul. 2017 102,860

Total 386,536 3. Funding Reserved for Long-Term Repair Plans

From the cash flows during the fiscal period, the Investment Corporation sets aside reserves for repairs, which are to be appropriated for repairs in the medium to long term. (Thousands of yen)

Fiscal period 10th Fiscal Period 11th Fiscal Period 12th Fiscal Period 13th Fiscal Period 14th Fiscal Period

From Feb. 1, 2015 to Jul. 31, 2015

From Aug. 1, 2015 to Jan. 31, 2016

From Feb. 1, 2016 to Jul. 31, 2016

From Aug. 1, 2016 to Jan. 31, 2017

From Feb. 1, 2017 to Jul. 31, 2017

Balance of reserves at the beginning of period 248,938 313,837 327,081 378,887 377,947

Amount of reserves during period 188,329 188,418 232,577 304,044 311,155

Reversal of reserves during period 123,430 175,173 180,771 304,984 339,736

Amount carried forward to next period 313,837 327,081 378,887 377,947 349,367

Status of Expenses and Liabilities 1. Statement of Expenses Related to Investments

(Thousands of yen)

Item 13th Fiscal Period From Aug. 1, 2016 to Jan. 31, 2017

14th Fiscal Period From Feb. 1, 2017 to Jul. 31, 2017

Asset management fee (Note) 381,274 394,196 Asset custody fee 6,560 6,682 Administrative service fees 25,245 25,980 Directors’ compensation 3,600 3,600 Other expenses 219,744 229,701

Total 636,425 660,160 (Note) In addition to the amount stated above, asset management fees amounting to ¥36,260 thousand and ¥ 108,945 thousand in the 13th Fiscal Period and

14th Fiscal Period, respectively, related to the acquisition of property are incorporated in the book value of each property． 2. Loan Status

The status of loans as of July 31, 2017 is as follows.

Type Lender Drawdown date

Balance at the beginning of

current period (millions of yen)

Balance at the end of current

period (millions of yen)

Average interest rate (%)

(Note 2)

Maturity date

Repayment method

Use of funds Remarks

Long

-term

loan

s (Not

e 1)

Mizuho Bank, Ltd. Mar. 23,

2011

3,570 3,570 0.53000 Mar. 23,

2019 Lump-sum repayment

(Note 4) Unsecured

Unguaranteed Sumitomo Mitsui Trust Bank, Limited 3,570 3,570 0.53000 The Bank of Tokyo-Mitsubishi UFJ, Ltd. 3,570 3,570 0.53000 Sumitomo Mitsui Banking Corporation 1,785 1,785 0.53000 Development Bank of Japan Inc.

Feb. 3, 2012

1,090 1,090 1.41200

Sep. 29, 2017

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mizuho Bank, Ltd. 1,090 1,090 1.41200 Sumitomo Mitsui Trust Bank, Limited 1,090 1,090 1.41200 The Bank of Tokyo-Mitsubishi UFJ, Ltd. 1,090 1,090 1.41200 Mitsubishi UFJ Trust and Banking Corporation 1,090 1,090 1.41200

Sumitomo Mitsui Banking Corporation 550 550 1.41200 The Tokyo Tomin Bank, Limited 300 300 1.41200 Mitsubishi UFJ Trust and Banking Corporation

Sep. 4, 2013 2,000 2,000 0.79500 Aug. 31,


(Note 4) Unsecured

Unguaranteed Mizuho Bank, Ltd.

Sep. 30, 2013

1,350 1,350 0.67075

Mar. 30, 2018

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 1,350 1,350 0.67075 Mitsubishi UFJ Trust and Banking Corporation 1,350 1,350 0.67075

Sumitomo Mitsui Banking Corporation 600 600 0.67075

Development Bank of Japan Inc. Sep. 30, 2013 1,350 1,350 0.90487 Sep. 30,


(Note 4) Unsecured

Unguaranteed Development Bank of Japan Inc.

Feb. 4, 2014

1,000 1,000 0.60700

Jan. 31, 2019

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed


Sumitomo Mitsui Banking Corporation 500 500 0.60700 Development Bank of Japan Inc.

Feb. 4, 2014

1,000 1,000 0.88240

Jan. 31, 2021

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Jun. 30, 2014

670 670 0.60150

Jun. 30, 2020

Lump-sum repayment

(Note 4) Unsecured Unguaranteed

Mizuho Bank, Ltd. 670 670 0.60150 Sumitomo Mitsui Trust Bank, Limited 670 670 0.60150 The Bank of Tokyo-Mitsubishi UFJ, Ltd. 670 670 0.60150 Mitsubishi UFJ Trust and Banking Corporation 670 670 0.60150


38 39

Status of Expenses and Liabilities







(Note 2)

Maturity date

Repayment method


Long

-term

loan

s (Not

e 1)

Development Bank of Japan Inc.

Jun. 30, 2014

910 910 0.90100

Jun. 30, 2022

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed


Sumitomo Mitsui Banking Corporation 450 450 0.90100 Shinkin Central Bank

Feb. 3, 2015

750 750 0.30820 Mar. 30,


(Note 4) Unsecured

Unguaranteed The Norinchukin Bank 750 750 0.30820 The Bank of Fukuoka, Ltd. 750 750 0.30820 Development Bank of Japan Inc.

Feb. 3, 2015

600 600 0.69250

Jan. 31, 2022

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Feb. 3, 2015

620 620 0.79875

Jan. 31, 2023

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Feb. 3, 2015

620 620 1.04200

Jan. 31, 2025

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Feb. 2, 2016

360 360 0.58430

Mar. 31, 2023

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Feb. 2, 2016

420 420 0.62460

Aug. 31, 2023

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Feb. 2, 2016

490 490 0.67745

Feb. 29, 2024

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Mar. 23, 2016

1,570 1,570 0.27125

Mar. 31, 2021

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mitsubishi UFJ Trust and Banking Corporation 1,570 1,570 0.27125

The Tokyo Tomin Bank, Limited 1,000 1,000 0.27125 Sumitomo Mitsui Trust Bank, Limited 785 785 0.27125







(Note 2)

Maturity date

Repayment method


Long

-term

loan

s (Not

e 1)

Development Bank of Japan Inc. Mar. 23,

2016

2,000 2,000 0.61950 Mar. 31,


(Note 4) Unsecured

Unguaranteed Mitsubishi UFJ Trust and Banking Corporation 2,000 2,000 0.61950

Sumitomo Mitsui Trust Bank, Limited 1,000 1,000 0.61950 Development Bank of Japan Inc.

Aug. 1, 2016

580 580 0.46655

Jul. 31, 2024

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Aug. 1, 2016

900 900 0.65518

Jul. 31, 2026

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed



Mizuho Trust & Banking, Co., Ltd. Sep. 30, 2016 1,550 - 0.20909

Sep. 30, 2017 (Note 3)

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mitsubishi UFJ Trust and Banking Corporation

Dec. 13, 2016 990 - 0.23000

Dec. 29, 2017 (Note 3)

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mizuho Trust & Banking, Co., Ltd.

Jan. 31, 2017

2,000 2,000 0.46691

Jan. 31, 2022

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

The Norinchukin Bank 1,500 1,500 0.46691 The Bank of Fukuoka, Ltd. 1,000 1,000 0.46691 The 77 Bank, Ltd. 500 500 0.46691 The Daishi Bank, Ltd. 500 500 0.46691 Development Bank of Japan Inc.

Feb. 2, 2017

- 580 0.62938

Jan. 31, 2024

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mizuho Bank, Ltd. - 580 0.62938 Sumitomo Mitsui Trust Bank, Limited - 580 0.62938 The Bank of Tokyo-Mitsubishi UFJ, Ltd. - 580 0.62938 Mitsubishi UFJ Trust and Banking Corporation - 580 0.62938

Sumitomo Mitsui Banking Corporation - 290 0.62938 Development Bank of Japan Inc.

Feb. 2, 2017

- 910 0.79571

Jan. 30, 2026

Lump-sum repayment

(Note 4) Unsecured

Unguaranteed

Mizuho Bank, Ltd. - 910 0.79571 Sumitomo Mitsui Trust Bank, Limited - 910 0.79571 The Bank of Tokyo-Mitsubishi UFJ, Ltd. - 910 0.79571 Mitsubishi UFJ Trust and Banking Corporation - 910 0.79571

Sumitomo Mitsui Banking Corporation - 450 0.79571 Total 91,970 97,620 (Note 1) Long-term loans include the current portion of long-term loans payable. (Note 2) Average interest rates consist of the borrowing rates for each loan agreement rounded to the fifth decimal place. Furthermore, the stated rate for loans

for which interest-rate swap transactions were carried out to avoid interest rate risk takes into account the effect of the interest-rate swap. (Note 3) The full amount was repaid before maturity on February 2, 2017. (Note 4) The usage of funds includes purchasing properties in trust and the repayment of existing loans.

40 41

Status of Expenses and Liabilities

3. Investment Corporation Bonds The status of investment corporation bonds as of July 31, 2017 is as follows.

Issue Issue date



Amount increased in


Amount decreased in




Coupon rate

(%)

Maturity date

Repayment method

Use of funds Security

1st Unsecured Bonds (Note 1)

Jul. 30, 2014 3,000 －－ 3,000 0.64000 Jul. 30,


(Note 2) Unsecured

2nd Unsecured Bonds (Note 1)

Jul. 18, 2017 － 1,000 － 1,000 0.23000 Jul. 15,


(Note 2) Unsecured

3rd Unsecured Bonds (Note 1)

Jul. 18, 2017 － 2,000 － 2,000 0.52000 Jul. 16,


(Note 2) Unsecured

Total 3,000 3,000 － 6,000 (Note 1) The bonds are subject to the pari passu clause among specified investment corporation bonds. (Note 2) The funds are appropriated to the acquisition of real estate in trust and the repayment of some of the existing borrowings. 4. Short-Term Investment Corporation Bonds

Not applicable

5. Investment Unit Acquisition Rights Not applicable

Purchase and Sale during the Period

Purchase and Sale during the Period 1. Purchase and Sale of Properties and Asset Backed Securities

Property name Acquisition Sale

Acquisition date Acquisition price (millions of yen) Sale date Sale price

(millions of yen) Book value

(millions of yen) Gain on sale

(millions of yen) COMFORIA AKIHABARA EAST Feb. 2, 2017 4,425 – – – –

COMFORIA MITA TROIS Feb. 2, 2017 890 – – – –

COMFORIA BUNKYOHAKUSAN Feb. 2, 2017 1,330 – – – –

COMFORIA KAMATA Feb. 2, 2017 5,721 – – – – COLLEGE COURT HACHIMANYAMA Feb. 2, 2017 1,245 – – – –

COMFORIA SHINSAIBASHI EAST Feb. 2, 2017 1,980 – – – –

COMFORIA KYOMACHIBORI Feb. 2, 2017 1,567 – – – –

COMFORIA AWAZA Feb. 2, 2017 1,289 – – – – COMFORIA GYOTOKU Jun. 1, 2017 978 – – – –

Total – 19,425 – – – – (Note) The acquisition price and sale price do not include miscellaneous expenses required for the acquisition or sale of said property, fixed property tax, city

planning tax, consumption tax and local consumption tax. 2. Purchase and Sale of Other Assets

Main assets other than the above properties and asset backed securities are bank deposits or bank deposits within trust assets. 3. Appraisals of Specified Assets

(1) Real estate, etc.

Acquisition or sale Type of asset Property name Acquisition or

sale date

Acquisition price or sale price


Real estate appraisal Appraisal value


Appraisal company

(Note 3)

Date of valuation

Acquisition Property in trust COMFORIA AKIHABARA EAST Feb. 2, 2017 4,425 4,460 (1) Oct. 31, 2016

Acquisition Property in trust COMFORIA MITA TROIS Feb. 2, 2017 890 894 (2) Oct. 31, 2016

Acquisition Property in trust COMFORIA BUNKYOHAKUSAN Feb. 2, 2017 1,330 1,350 (3) Oct. 31, 2016

Acquisition Property in trust COMFORIA KAMATA Feb. 2, 2017 5,721 5,750 (1) Oct. 31, 2016

Acquisition Property in trust COLLEGE COURT HACHIMANYAMA Feb. 2, 2017 1,245 1,250 (4) Oct. 31, 2016

Acquisition Property in trust COMFORIA SHINSAIBASHI EAST

Feb. 2, 2017 1,980 2,000 (1) Oct. 31, 2016

Acquisition Property in trust COMFORIA KYOMACHIBORI Feb. 2, 2017 1,567 1,580 (1) Oct. 31, 2016

Acquisition Property in trust COMFORIA AWAZA Feb. 2, 2017 1,289 1,310 (1) Oct. 31, 2016

Acquisition Property in trust COMFORIA GYOTOKU Jun. 1, 2017 978 989 (1) Apr. 30, 2017

(Note 1) The acquisition price and sale price do not include miscellaneous expenses required for the acquisition or sale of said property, fixed property tax, city planning tax, consumption tax and local consumption tax.

(Note 2) Appraisal value indicates appraisal value or investigated value. (Note 3) The appraisal companies handling the real estate appraisal of each property are (1) Japan Real Estate Institute, (2) Morii Appraisal & Investment

Consulting Inc., (3) The Tanizawa Sogo Appraisal Co., Ltd. and (4) Daiwa Real Estate Appraisal Co., Ltd.

(2) Other Of the transactions carried out by the Investment Corporation, there were no other transactions than those shown in the aforementioned “(1) Real estate, etc.” that were deemed to require an appraisal pursuant to the provisions of Article 201 of the Investment Trust Act.

42 43

Purchase and Sale during the Period

4. Transactions with Related Parties (1) Information on transaction

Category Purchase and sales amount

Purchase amount Sales amount

Total amount ¥19,425,000 thousand ¥－ thousand

Breakdown of transactions between related parties

Tokyu Land Corporation ¥13,596,000 thousand (70.0%) ¥－ thousand (－ %)

GK Gemini ¥3,465,000 thousand (17.8%) ¥－ thousand (－ %)

Total ¥17,061,000 thousand (87.8%) ¥－ thousand (－ %) (Note) The term “Related parties” refers to related parties defined in Article 123 of the Order for Enforcement of the Act on Investment Trusts and Investment

Corporations as well as related parties of the Investment Corporation prescribed in Article 26, Paragraph 1, Item 27 of the Regulations Concerning Investment Reports of Investment Trusts and Investment Corporations issued by the Investment Trusts Association, Japan. Descriptions are included with regard to related parties that fall under any of these and that had transactions or paid commissions, etc. during the 14h Fiscal Period. (The same shall apply in “(2) Amount of commission paid” and “(3) Major payments to other related parties” below.

(2) Amount of commission paid

Category

Total amount of commission paid

(A) (thousands of yen)

Breakdown of transaction with related parties Percentage of total

amount (B/A) (%) Payee

Amount of payment (B)

(thousands of yen)

Property management entrustment costs 617,302

Tokyu Housing Lease Corporation 351,106 56.9 TS Community Co., Ltd. 24,637 4.0 Tokyu Community Corp. 3,370 0.5

Marketing-related expenses 174,509 Tokyu Livable, Inc. 3,228 1.8

Other expenses related to rent business 159,307

Tokyu Sports Oasis, Inc. 9,122 5.7 Tokyu Community Corp. 980 0.6 TS Community Co., Ltd. 804 0.5

Warehousing expenses 83,944 GK Gemini 83,944 100.0 (3) Major payments to other related parties

Tokyu Homes Corporation ¥195,768 thousand (repair work, etc.) Ewel Inc. ¥3,315 thousand (system usage, etc.) TS Community Co., Ltd. ¥719 thousand (repair work)

5. Transactions with Asset Management Company related to Concurrent Operations Carried Out by the Asset

Management Company The Asset Management Company is not concurrently engaged in type I financial instruments business, type II financial instruments business, realty business or specified real estate cooperative business.

Accounting Status

Accounting Status 1. Assets, Liabilities, Principal and Profit/Loss

Please refer to “1. Balance Sheets,” “2. Statements of Income,” “3. Statements of Changes in Unitholders’ Equity,” “4. Statements of Cash Distributions,” “5. Statements of Cash Flows,” and “6. Notes.”

2. Changes in the Calculation Method of Depreciation

Not applicable 3. Changes in the Appraisal Method of Real Estate, etc.

Not applicable Other 1. Beneficiary Certificates of Investment Trusts Established by the Investment Corporation

Not applicable

2. Notices (1) Unitholders’ Meeting

Not applicable (2) Board of Directors of the Investment Corporation

The main overviews of the major conclusion and change of contracts that were approved by the Board of Directors of the Investment Corporation during current period are as follows.

Approval date Matter Overview

May 30, 2017

Comprehensive resolution for issuance of investment corporation bonds and entrustment of general administrative duties

Comprehensive resolution for the issuance of investment corporation bonds with aggregate maximum amount of issuance of 25 billion yen and a period of issuance from June 1, 2017 to May 31, 2018 was made. As to entrustment of administrative duties concerning offering of investment corporation bonds and general administrative duties, including issuing, financial and paying agent, a candidate company was approved and other necessary matters to be decided were left to the discretion of Executive Director.

3. Disclosure on Overseas Property-Owning Corporations

Not applicable 4. Disclosure on Real Estate Owned by Overseas Property-Owning Corporations

Not applicable 5. Other

Figures in this document are rounded down (values) and rounded to the nearest decimal place (percentages) unless otherwise indicated.

44 45

III. Financial Section 1. Balance Sheets

(Thousands of yen)

13th Fiscal Period (As of January 31, 2017)

14th Fiscal Period (As of July 31, 2017)

Assets Current assets

Cash and deposits 5,634,348 6,696,439 Cash and deposits in trust 6,012,085 6,483,562 Operating accounts receivable 13,160 7,669 Prepaid expenses 134,716 382,164 Consumption taxes receivable － 17,604 Other 431 446 Total current assets 11,794,742 13,587,887

Non-current assets Property, plant and equipment

Buildings 1,895,400 1,895,903 Accumulated depreciation (65,971) (87,598) Buildings, net 1,829,429 1,808,305

Structures 21,514 21,514 Accumulated depreciation (1,685) (2,367) Structures, net 19,828 19,146

Machinery and equipment 17,687 17,687 Accumulated depreciation (365) (639) Machinery and equipment, net 17,322 17,048

Tools, furniture and fixtures 1,628 1,628 Accumulated depreciation (71) (217) Tools, furniture and fixtures, net 1,557 1,411

Land 2,405,775 2,405,775 Buildings in trust 81,019,743 88,468,161

Accumulated depreciation (6,439,898) (7,476,802) Buildings in trust, net 74,579,844 80,991,359

Structures in trust 1,085,525 1,130,260 Accumulated depreciation (200,657) (229,113) Structures in trust, net 884,868 901,146

Machinery and equipment in trust 1,471,940 1,557,509 Accumulated depreciation (171,110) (198,577) Machinery and equipment in trust, net 1,300,829 1,358,931

Tools, furniture and fixtures in trust 125,460 184,869 Accumulated depreciation (39,147) (52,433) Tools, furniture and fixtures in trust, net 86,312 132,435

Land in trust 87,211,899 100,224,324 Total property, plant and equipment 168,337,668 187,859,884

Intangible assets Leasehold rights in trust 1,209,138 1,200,572 Other 18,421 16,027 Total intangible assets 1,227,559 1,216,600

Investments and other assets Lease and guarantee deposits 1,508,094 1,507,223 Long-term prepaid expenses 981,671 869,545 Total investments and other assets 2,489,765 2,376,768

Total non-current assets 172,054,993 191,453,253 Deferred assets

Investment unit issuance expenses 40,875 47,005 Investment corporation bond issuance costs 12,135 33,577 Total deferred assets 53,011 80,583

Total assets 183,902,747 205,121,723

(Thousands of yen)



Liabilities Current liabilities

Operating accounts payable 470,181 721,526 Current portion of long-term loans payable 8,840,000 13,200,000 Accounts payable - other 55,657 37,987 Accrued expenses 122,638 135,273 Income taxes payable 5,721 5,888 Accrued consumption taxes 12,057 - Advances received 1,074,184 1,162,151 Other 2,567 12,302 Total current liabilities 10,583,007 15,275,131

Non-current liabilities Investment corporation bond 3,000,000 6,000,000 Long-term loans payable 83,130,000 84,420,000 Tenant leasehold and security deposits 21,121 22,314 Tenant leasehold and security deposits in trust 1,901,107 2,049,904 Asset retirement obligations 94,592 95,182 Other 1,165 777 Total non-current liabilities 88,147,987 92,588,178

Total liabilities 98,730,995 107,863,309 Net assets

Unitholders' equity Unitholders' capital 82,743,523 94,557,898 Surplus

Voluntary retained earnings Reserve for reduction entry 92,170 92,170 Total voluntary retained earnings 92,170 92,170

Unappropriated retained earnings (undisposed loss) 2,336,057 2,608,344

Total surplus 2,428,227 2,700,515 Total unitholders' equity 85,171,751 97,258,413

Total net assets *1 85,171,751 *1 97,258,413 Total liabilities and net assets 183,902,747 205,121,723

Ⅲ. Financial Section

46 47

2. Statements of Income (Thousands of yen)

13th Fiscal Period

(From August 1, 2016 to January 31, 2017)

14th Fiscal Period (From February 1, 2017 to July

31, 2017)

Operating revenue Lease business revenue *1 6,433,203 *1 6,996,758 Other lease business revenue *1 241,076 *1 280,016 Total operating revenue 6,674,280 7,276,775

Operating expenses Expenses related to rent business *1 3,249,401 *1 3,518,418 Asset management fee 381,274 394,196 Directors' compensations 3,600 3,600 Audit fee 13,194 13,842 Asset custody fee 6,560 6,682 Administrative service fees 25,245 25,980 Other operating expenses 206,550 215,859 Total operating expenses 3,885,826 4,178,578

Operating profit 2,788,453 3,098,197 Non-operating income

Interest income 57 54 Gain on forfeiture of unclaimed dividends 1,033 964 Other 440 - Total non-operating income 1,532 1,019

Non-operating expenses Interest expenses 310,754 338,375 Borrowing related expenses 107,430 118,553 Interest expenses on investment corporation bond 9,600 10,047 Amortization of investment corporation bond issuance costs

1,373 1,634

Amortization of investment unit issuance expenses 19,445 16,894 Total non-operating expenses 448,605 485,506

Ordinary profit 2,341,380 2,613,710 Profit before income taxes 2,341,380 2,613,710 Income taxes - current 5,729 5,896 Income taxes - deferred (214) (403) Total income taxes 5,515 5,493 Profit 2,335,864 2,608,216 Retained earnings brought forward 193 127 Unappropriated retained earnings (undisposed loss) 2,336,057 2,608,344

3. Statements of Changes in Unitholders’ Equity 13th Fiscal Period (From August 1, 2016 to January 31, 2017)

(Thousands of yen)

Unitholders' equity

Total net assets

Unitholders' capital

Surplus

Total unitholders'

equity

Voluntary retained earnings Unappropriated

retained earnings

(undisposed loss)

Total surplus

Reserve for

reduction entry

Total voluntary retained earnings

Balance at beginning of current period

82,743,523 92,170 92,170 2,304,285 2,396,455 85,139,979 85,139,979

Changes of items during period

Dividends of surplus (2,304,092) (2,304,092) (2,304,092) (2,304,092)

Profit 2,335,864 2,335,864 2,335,864 2,335,864

Total changes of items during period

－－－ 31,772 31,772 31,772 31,772

Balance at end of current period

*1 82,743,523

92,170 92,170 2,336,057 2,428,227 85,171,751 85,171,751

14th Fiscal Period (From February 1, 2017 to July 31, 2017)

(Thousands of yen)

Unitholders' equity

Total net assets

Unitholders' capital

Surplus

Total unitholders'

equity

Voluntary retained earnings Unappropriated

retained earnings

(undisposed loss)

Total surplus

Reserve for

reduction entry

Total voluntary retained earnings

Balance at beginning of current period

82,743,523 92,170 92,170 2,336,057 2,428,227 85,171,751 85,171,751

Changes of items during period

Issuance of new investment units

11,814,374 11,814,374 11,814,374

Dividends of surplus (2,335,929) (2,335,929) (2,335,929) (2,335,929)

Profit 2,608,216 2,608,216 2,608,216 2,608,216

Total changes of items during period

11,814,374 －－ 272,287 272,287 12,086,661 12,086,661


*1

94,557,898 92,170 92,170 2,608,344 2,700,515 97,258,413 97,258,413

48 49

4. Statements of Cash Distributions

Category 13th Fiscal Period


14th Fiscal Period (From February 1, 2017

to July 31, 2017)

I. Unappropriated retained earnings ¥2,336,057,575 ¥2,608,344,833 II. Reversal of Voluntary retained

earnings

Reversal of reserve for reduction entry - ¥30,323,941 III. Distributions ¥2,335,929,696 ¥2,638,651,614 [Distribution per unit] [¥4,549] [¥4,681] IV. Retained earnings carried forward ¥127,879 ¥17,160 Method for calculating distributions

The Investment Corporation will make cash distributions using accounting profits up to the amount of total surplus based on the distribution policy outlined in Article 35-1 of the Investment Corporation’s Articles of Incorporation, in an amount that exceeds 90% of the “amount of distributable profit” of the Investment Corporation as set forth in Article 67-15 of the Act on Special Measures Concerning Taxation. Based on this policy, the Investment Corporation has determined to pay out ¥2,335,929,696 as the total amount of dividends for the period under review, which is nearly equivalent to the entire amount of unappropriated retained earnings. Furthermore, the Investment Corporation does not pay out dividends that exceed accounting profits as outlined in Article 35-2 of the Investment Corporation’s Articles of Incorporation.

The Investment Corporation will make cash distributions using accounting profits up to the amount of total surplus based on the distribution policy outlined in Article 35-1 of the Investment Corporation’s Articles of Incorporation, in an amount that exceeds 90% of the “amount of distributable profit” of the Investment Corporation as set forth in Article 67-15 of the Act on Special Measures Concerning Taxation. Based on this policy, the Investment Corporation has determined to pay out ¥2,638,651,614 as the total amount of dividends for the period under review, which is nearly equivalent to the entire amount of unappropriated retained earnings after adding reversal of reserve for reduction entry. Furthermore, the Investment Corporation does not pay out dividends that exceed accounting profits as outlined in Article 35-2 of the Investment Corporation’s Articles of Incorporation.

5. Statements of Cash Flows (Thousands of yen)

13th Fiscal Period


14th Fiscal Period (From February 1, 2017 to

July 31, 2017)

Cash flows from operating activities Profit before income taxes 2,341,380 2,613,710 Depreciation 1,052,308 1,141,111 Borrowing related expenses 107,430 118,553 Amortization of investment corporation bond issuance costs 1,373 1,634 Amortization of investment unit issuance expenses 19,445 16,894 Interest income (57) (54) Gain on forfeiture of unclaimed dividends (1,033) (964) Interest expenses 320,355 348,423 Decrease (increase) in operating accounts receivable (6,586) 5,490 Decrease (increase) in prepaid expenses 22,591 (25,396) Decrease (increase) in consumption taxes receivable 89,406 (17,604) Increase (decrease) in accrued consumption taxes 12,057 (12,057) Increase (decrease) in operating accounts payable 24,447 37,208 Increase (decrease) in accounts payable - other 3,274 399 Increase (decrease) in accrued expenses 2,048 12,258 Increase (decrease) in advances received 36,212 87,967 Decrease (increase) in long-term prepaid expenses - (56,990) Other, net 620 9,999 Subtotal 4,025,274 4,280,585 Interest income received 57 54 Interest expenses paid (323,472) (348,046) Income taxes paid (7,493) (5,729) Net cash provided by (used in) operating activities 3,694,366 3,926,864

Cash flows from investing activities Purchase of property, plant and equipment (24,039) (1,655) Purchase of property, plant and equipment in trust (4,108,752) (20,456,767) Purchase of intangible assets (3,520) (720) Proceeds from collection of lease and guarantee deposits - 900 Payments for lease and guarantee deposits (900) (29) Proceeds from tenant leasehold and security deposits 5,241 3,343 Repayments of tenant leasehold and security deposits (1,646) (2,164) Proceeds from tenant leasehold and security deposits in trust 200,729 386,952 Repayments of tenant leasehold and security deposits in trust (196,450) (227,481) Net cash provided by (used in) investing activities (4,129,337) (20,297,622)

Cash flows from financing activities Increase in short-term loans payable - 1,000,000 Decrease in short-term loans payable - (1,000,000) Proceeds from long-term loans payable 15,924,929 10,027,282 Repayments of long-term loans payable (12,270,000) (4,540,000) Proceeds from issuance of investment corporation bond - 2,979,381 Proceeds from issuance of investment units - 11,782,674 Dividends paid (2,303,716) (2,336,119) Other, net (6,901) (8,893) Net cash provided by (used in) financing activities 1,344,311 17,904,325

Net increase (decrease) in cash and cash equivalents 909,339 1,533,567 Cash and cash equivalents at beginning of period 10,737,094 11,646,434 Cash and cash equivalents at end of period *1 11,646,434 *1 13,180,002

50 51

6. Notes <Summary of Significant Accounting Policies>

1. Method of depreciation and amortization of non-current assets

(1) Property, plant and equipment (including trust assets) Property, plant and equipment are depreciated using the straight-line method over the estimated useful lives as follows: Buildings 2–70 years Structures 2–64 years Machinery and equipment 10–34 years Tools, furniture and fixtures 3–15 years

(2) Intangible assets (including assets in trust)

Intangible assets are amortized by the straight-line method.

(3) Long-term prepaid expenses Long-term prepaid expenses are amortized by the straight-line method.

2. Accounting policies for deferred assets

(1) Investment corporation bonds issuance costs Investment corporation bonds issuance costs are amortized using the straight-line method over the redemption periods.

(2) Investment unit issuance expenses Investment unit issuance expenses are amortized using the straight-line method over three years.

3. Accounting standards for revenues and expenses

Accounting treatment of property tax, city planning tax, and depreciable asset tax For property tax, city planning tax, and depreciable asset tax (“property tax”) for real estate properties held, the amounts to be paid for the fiscal periods are calculated out of the tax amounts decided to be levied and are recorded as expenses related to rent business. Of the amounts paid for the acquisition of real estate property or beneficial interests in real estate trust, the amounts equivalent to property tax settled with the seller of the property are capitalized as part of the acquisition cost of the relevant property rather than being charged as expenses.

4. Method of hedge accounting (1) Method of hedge accounting The deferred hedge method is applied. However, the special accounting treatment is applied for interest-rate swap transactions that meet certain criteria.

(2) Hedging instruments and hedged items

Hedging instruments: Interest rate swap transactions Hedged items: Interest expenses on loans payable

(3) Hedging policy

The Investment Corporation enters into derivative transactions based on its investment management guidelines with the objective of hedging interest rate fluctuation risks and other risks pertaining to borrowings, etc.

(4) Method of evaluating the effectiveness of hedging

As for the method of assessing the effectiveness of the hedge, the cumulative changes in cash flow of the hedged items and hedging instruments are compared and a judgment is made by verifying the ratio of the changed amount. However, an assessment of the effectiveness of hedging activities is omitted in the case of interest-rate swap transactions that meet the requirements for the special treatment.

5. Scope of funds (cash and cash equivalents) on the Statements of Cash Flows

The funds (cash and cash equivalents) on the Statements of Cash Flows consist of cash on hand and cash in trust, deposits and deposits in trust that are readily available, and short-term investments with maturities of three months or less from the date of purchase which are readily convertible to cash and with insignificant risk of market value fluctuation.

6. Other significant accounting policies utilized in the preparation of financial statements

(1) Accounting method for beneficial interests in real estate trust and other assets Regarding trust beneficiary interests in real estate, all assets and liability accounts of entrusted properties as well as revenue and expense accounts generated by the property in trust are recorded in relevant accounts on the Balance Sheets and Statements of Income.

Important line items included in accounting for financial assets and liabilities in the Investment Corporation’s Balance Sheets are as follows: (i) Cash and deposits in trust (ii) Buildings in trust; structures in trust; machinery and equipment in trust; tools,

furniture and fixtures in trust; land in trust; construction in progress in trust; and leasehold rights in trust

(iii) Tenant leasehold and security deposits in trust

(2) Accounting method for consumption tax Revenues and expenses in the Statements of Income do not include consumption taxes. Non-deductible consumption taxes applicable to the acquisition of non-current assets, etc. are included in the cost of acquisition for each asset.

<Notes to the Balance Sheets> *1. Minimum net assets pursuant to Article 67-4 of the Act on Investment Trusts and Investment Corporations

(Thousands of yen)



50,000 50,000 <Notes to the Statements of Income> *1. Breakdown of real estate rental revenues and expenses

(Thousands of yen)

13th Fiscal Period



to July 31, 2017) A. Real estate rental revenue

Lease business revenue (Rental revenues, common service charges) 6,284,324 6,843,578

(Parking revenues) 148,878 6,433,203 153,179 6,996,758 Other lease business revenue

(Key money and contract renewal fees) 125,096 160,652

(Other revenues) 115,980 241,076 119,364 280,016 Total real estate rental revenues 6,674,280 7,276,775

B. Real estate rental expenses Expenses related to rent business

(Property management fees and facility management fees) 554,646 617,302

(Repairs and maintenance) 225,624 282,191 (Land rent) 697,599 697,599 (Tax and public dues) 262,703 297,151 (Insurance) 6,371 6,608 (Utilities) 96,190 100,251 (Marketing-related expenses) 153,140 174,509 (Trust fees) 42,073 44,572 (Depreciation) 1,049,477 1,137,997 (Other expenses related to rent business) 161,573 160,233

Total real estate rental expenses 3,249,401 3,518,418 C. Income from real estate rental business

(A - B) 3,424,878 3,758,357

52 53

<Notes to the Statements of Changes in Unitholders’ Equity>

13th Fiscal Period



to July 31, 2017) *1. Total number of authorized investment

units and total number of investment units issued and outstanding

Total number of authorized investment units 8,000,000 units 8,000,000 units Total number of investment units issued and outstanding 513,504 units 563,694 units

<Notes to the Statements of Cash Flows> *1. Reconciliation of balance sheets items to cash and cash equivalents at end of period in the Statements of Cash Flows

(Thousands of yen)

13th Fiscal Period



to July 31, 2017) Cash and deposits 5,634,348 6,696,439 Cash and deposits in trust 6,012,085 6,483,562 Cash and cash equivalents 11,646,434 13,180,002

<Notes to lease transactions> 1. Operating lease transactions (Lessee)

Future minimum lease payments under non-cancelable operating lease transactions (Thousands of yen)



Due within 1 year 1,363,440 1,364,328 Due after 1 year 81,670,056 81,041,083 Total 83,033,496 82,405,411

2. Operating lease transactions (Lessor)

Future minimum lease payments receivable under non-cancelable operating lease transactions (Thousands of yen)



Due within 1 year 222,782 249,570 Due after 1 year 497,547 500,451 Total 720,330 750,022

<Notes to financial instruments> 1. Status of financial instruments

(1) Policies for financial instruments With a focus on stability, flexibility and efficiency as the basis of its financial policy, the Investment Corporation procures funds through borrowings as well as the issuance of investment corporation bonds (including short-term investment corporation bonds; the same shall apply hereinafter) and investment units among other means with the aim of growing its investment assets through their acquisition. The Investment Corporation may enter into derivatives transactions, which shall be executed solely for the purpose of hedging against interest-rate fluctuations and other risks pertaining to borrowings, etc.

(2) Characteristics and risk profile of each financial instrument and risk management system

The funds for borrowings and investment corporation bonds are mainly appropriated for the acquisition of investment assets and repayment of borrowings, etc. With regard to liquidity and interest rate fluctuation risks associated with these financing activities, the Investment Corporation endeavors to manage and limit them by considering and implementing multifaceted funding methods including the utilization of surplus funds and raising funds, etc. from capital markets through issuance of investment units, etc. while diversifying funding sources. Although loans with floating interest rates are exposed to a risk of fluctuation in interest payable, the Investment Corporation employs derivative transactions (interest-rate swap transactions) as hedging instruments in order to avoid interest rate fluctuation risks and fix payment of interest expenses. For more detailed information on the method of hedge accounting, hedging instruments, hedged items, hedging policy and the evaluation method for hedge effectiveness, please refer to the previous section “6. Notes: Summary of significant accounting policies, 4. Method of hedge accounting.”

(3) Supplementary note regarding fair value of financial instruments

The fair values of financial instruments presented in this report is based on their market value, and in cases where market value is not available, reasonably estimated values are presented. Since the estimation of fair value is based on certain assumptions, fair value could differ depending on the assumptions used.

2. Fair value of financial instruments The carrying value of financial instruments on the balance sheet, their fair value and the differences between them as of January 31, 2017 are as follows.

(Thousands of yen)

Carrying value (Note 1)

Fair value (Note 1) Difference

(1) Cash and deposits 5,634,348 5,634,348 –

(2) Cash and deposits in trust 6,012,085 6,012,085 –

(3) Current portion of long-term loans payable (8,840,000) (8,884,403) 44,403

(4) Investment corporation bonds (3,000,000) (3,050,232) 50,232

(5) Long-term loans payable (83,130,000) (83,597,013) 467,013

(6) Derivative transactions – – – The carrying value of financial instruments on the balance sheet, their fair value and the differences between them as of July 31, 2017 are as follows.

(Thousands of yen)

Carrying value (Note 1)

Fair value (Note 1) Difference

(1) Cash and deposits 6,696,439 6,696,439 －

(2) Cash and deposits in trust 6,483,562 6,483,562 －

(3) Current portion of long-term loans payable (13,200,000) (13,225,382) 25,382

(4) Investment corporation bonds (6,000,000) (6,055,925) 55,925

(5) Long-term loans payable (84,420,000) (84,981,705) 561,705

(6) Derivative transactions －－－ (Note 1) Figures in parentheses indicate liabilities. (Note 2) Methods to determine the fair value of financial instruments:

(1) Cash and deposits and (2) Cash and deposits in trust Due to their short tenors, the carrying values of these assets are reasonable approximations of their present value and hence are used as their fair value.

(3) Current portion of long-term loans payable and (5) Long-term loans payable For loans with floating interest rates, since the interest rates on such loans reflect market rates reasonably well over the short term and their carrying values are good approximations of their fair value, the carrying values are presented as their fair value. However, the fair value of floating-rate long-term loans payable and current portion of long-term loans payable hedged by interest-rate swap transactions subject to special accounting treatment (refer to the following section entitled “Notes to derivative transactions”) are calculated by discounting the aggregated principal and interest on such loans, after taking into account the effect of said interest-rate swap transactions, using reasonable estimates of the rates that would be applicable in a similar borrowing.

(4) Investment corporation bonds The fair value of investment corporation bonds is measured based upon the present value obtained by discounting the total amount of principal and interest at a rate that takes into account the term to maturity and credit risk.

(6) Derivative transactions Please refer to the following section entitled “Notes to derivative transactions.”

(Note 3) Carrying value of financial instruments whose fair value cannot be reliably measured (Thousands of yen)



(1) Tenant leasehold and security deposits (21,121) (22,314)

(2) Tenant leasehold and security deposits in trust (1,901,107) (2,049,904)

(1)(2) Fair value of tenant leasehold and security deposits and leasehold and security deposits in trust is not subject to disclosure of fair value, as these items have no market value and their future cash flows are difficult to reasonably estimate given the fact that although a predetermined period for each lease contract exists, the actual deposit period cannot be calculated due to possible contract termination, renewal or extension.

(3) Figures in parentheses indicate liabilities.

54 55

(Note 4) Redemption schedule for monetary claims (Thousands of yen)


Due in 1 year or less

Deposits 5,634,348

Deposits in trust 6,012,085

Total 11,646,434



Deposits 6,696,439

Deposits in trust 6,483,562

Total 13,180,002

(Note 5) Redemption schedule for loans payable and investment corporation bonds (Thousands of yen)



Due after 1 year to 2 years

Due after 2 years to 3 years


Due after 4 years to 5 years Due after 5 years

Current portion of long-term loans payable

8,840,000 – – – – –

Long-term loans payable – 14,400,000 13,845,000 9,200,000 13,725,000 31,960,000

Investment corporation bonds – – – – 3,000,000 –

Total 8,840,000 14,400,000 13,845,000 9,200,000 16,725,000 31,960,000







Current portion of long-term loans payable

13,200,000 －－－－－

Long-term loans payable － 19,995,000 5,050,000 10,425,000 13,800,000 35,150,000

Investment corporation bonds －－－ 3,000,000 1,000,000 2,000,000

Total 13,200,000 19,995,000 5,050,000 13,425,000 14,800,000 37,150,000

<Notes to investment securities>

13th Fiscal Period (As of January 31, 2017) Not applicable

14th Fiscal Period (As of July 31, 2017) Not applicable

<Notes to derivative transactions> 1. Transactions not subject to hedge accounting

13th Fiscal Period (As of January 31, 2017) Not applicable

14th Fiscal Period (As of July 31, 2017) Not applicable

2. Transactions subject to hedge accounting

13th Fiscal Period (As of January 31, 2017) (Thousands of yen)

Hedge accounting method

Type of derivative transactions Hedged items

Contract amount Fair value

Calculation method for

applicable fair value

Maturing after 1 year

Special treatment of interest-rate

swap transactions

Receive floating, pay fixed interest-rate swap transactions

Long-term loans payable

(*1) 55,645,000 55,645,000 (*2) –

Total 55,645,000 55,645,000 – –


(Thousands of yen)

Hedge accounting method

Type of derivative transactions Hedged items

Contract amount Fair value

Calculation method for

applicable fair value

Maturing after 1 year

Special treatment of interest-rate

swap transactions

Receive floating, pay fixed interest-rate swap transactions

Long-term loans payable

(*1) 55,645,000 48,745,000 (*2) –

Total 55,645,000 48,745,000 – –

*1 Long-term loans payable include the current portion of long-term loans payable. *2 Interest-rate swap transactions for which the special treatment is applied are accounted for together with long-term loans payable and the underlying

hedged items. As a result, their fair value is included in the fair value of items listed under “(3) Current portion of long-term loans payable” and “(5) Long-term loans payable” in the section entitled “2. Fair value of financial instruments” under the “Notes to financial instruments.”

<Notes to retirement benefits>

13th Fiscal Period (As of January 31, 2017) The disclosure of relevant information is omitted since the Investment Corporation does not have a retirement benefit program.

14th Fiscal Period (As of July 31, 2017) The disclosure of relevant information is omitted since the Investment Corporation does not have a retirement benefit program.

<Notes to deferred tax accounting> 1. Components of deferred tax assets and liabilities

(Thousands of yen)



Deferred tax assets Nondeductible enterprise tax payable 431 446 Amortization of leasehold rights 5,927 8,890 Asset retirement obligations 32,729 32,933 Subtotal of deferred tax assets 39,087 42,270 Valuation allowance (38,656) (41,824)

Total deferred tax assets 431 446

Deferred tax liabilities Property, plant and equipment corresponding to asset retirement obligations

(1,165)

(777)

Total deferred tax liabilities (1,165) (777) Deferred tax liabilities, net (734) (330)

56 57

2. Significant differences between the statutory tax rate and the effective tax rate (%)



Statutory tax rate 34.81 34.81 (Adjustments)

Deductible cash distributions (34.73) (35.14) Other 0.15 0.54

Effective tax rate 0.24 0.21

<Notes to equity in net earnings (losses) of affiliated companies> 13th Fiscal Period (From August 1, 2016 to January 31, 2017)

The disclosure of relevant information is omitted since the Investment Corporation does not have affiliated companies. 14th Fiscal Period (From February 1, 2017 to July 31, 2017)

The disclosure of relevant information is omitted since the Investment Corporation does not have affiliated companies. <Notes to related-party transactions> 1. Parent company, major corporate unitholders and other

13th Fiscal Period (From August 1, 2016 to January 31, 2017) Not applicable

14th Fiscal Period (From February 1, 2017 to July 31, 2017) Not applicable

2. Affiliated companies and other



3. Fellow subsidiary companies and other

13th Fiscal Period (From August 1, 2016 to January 31, 2017)

Attribution

Company’s name or person’s

name

Location

Capital and investment (millions of

yen)

Line of business

or job title

Ratio of voting interest (held) (%)

(Note 1)

Relationship

Details of transactions

Transaction amount

(thousands of yen)

Account

Period-end balance

(thousands of yen)

Concurrent positions held by officers

Business relationship

Major unitholder’s subsidiary

Tokyu Housing

Lease Corporation

Shinjuku-ku, Tokyo 100

Real estate

business – No

Major unitholder’s subsidiary

Property management

contract 291,076

Operating accounts payable

58,341

(Note 1) The ratio of voting interest is rounded down to the second decimal place. (Note 2) In the above amounts, transaction amount does not include consumption taxes, while the period-end balance does include consumption taxes. (Note 3) Transaction terms are determined based on price negotiation in light of prevailing market prices, etc.


4. Directors, major individual unitholders and other



<Notes to asset retirement obligations> 1. Overview of asset retirement obligations

The Investment Corporation has concluded fixed-term lease contracts with certain landlords, and recognizes asset retirement obligations concerning the duty of restoration upon the expiry of the lease period with regard to some of these assets.

2. Calculation of the amount of asset retirement obligations Asset retirement obligations are calculated based on the remaining period of the fixed-term lease (52 years) as the expected period of use and 1.2% as the discount rate.

3. Changes in the total amount of asset retirement obligations

(Thousands of yen)

13th Fiscal Period



to July 31, 2017) Balance at beginning of period 94,006 94,592

Increase due to purchase of property, plant and equipment

－－

Adjustment due to passage of time 585 589

Balance at end of period 94,592 95,182

<Notes to investment and rental properties>

The Investment Corporation owns real estate for rental purposes (including land) in the Tokyo metropolitan area and other regional areas. The book value, changes during the period and fair value regarding the above real estate for rental purposes are as follows.

(Thousands of yen) 13th Fiscal Period



to July 31, 2017) Book value

Balance at beginning of period 166,535,573 169,546,806

Changes during period 3,011,232 19,513,651

Balance at end of period 169,546,806 189,060,457

Fair value at end of period 196,314,000 218,880,000 (Note 1) The book value excludes accumulated depreciation from acquisition cost. The book value does not include construction in progress and

construction in progress in trust. (Note 2) Among changes in the book value of real estate for rental purposes that occurred during the 13th Fiscal Period, the principal increase consisted of

the acquisition of three properties including COMFORIA SAPPORO SHOKUBUTSUEN and two other properties during the 13th Fiscal Period totaling ¥3,926,530 thousand, while the principal decrease consisted of depreciation of ¥1,048,892 thousand. During the 14th Fiscal Period, the principal increase consisted of the acquisition of nine properties including COMFORIA AKIHABARA EAST and eight other properties during the 14th Fiscal Period totaling ¥20,268,232 thousand, while the principal decrease consisted of depreciation of ¥1,137,408 thousand.

(Note 3) The fair value at end of period is the appraisal value or the survey value determined by outside appraisers.

Income and loss related to real estate for rental purposes, etc. for the 13th Fiscal Period (From August 1, 2016 to January 31, 2017) and 14th Fiscal Period (From February 1, 2017 to July 31, 2017) are listed in “Notes to the Statements of Income.”

<Notes to segment information> (Segment information)

Disclosure is omitted because the property leasing business is the Investment Corporation’s sole business, with no reportable segment subject to disclosure.

(Related information)

13th Fiscal Period (From August 1, 2016 to January 31, 2017) 1. Information about each product and service

Disclosure is omitted because net sales to external customers of a single product/service category account for over 90% of the operating revenues on the Statements of Income.

2. Information about each geographic area (1) Net sales

Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues on the Statement of Income.

(2) Property, plant and equipment Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount of property, plant and equipment on the Balance Sheet.

3. Information about each major customer Disclosure is omitted because there is no single external customer whose net sales accounts for 10% or more of operating revenues on the Statements of Income.

14th Fiscal Period (From February 1, 2017 to July 31, 2017) 1. Information about each product and service

Disclosure is omitted because net sales to external customers for a single product/service category account for over 90% of the operating revenues on the Statements of Income.

2. Information about each geographic area

58 59

(1) Net sales Disclosure is omitted because net sales to external customers in Japan account for over 90% of the operating revenues on the Statements of Income.

(2) Property, plant and equipment Disclosure is omitted because the amount of property, plant and equipment located in Japan accounts for over 90% of the amount of property, plant and equipment on the Balance Sheet.

3. Information about each major customer Disclosure is omitted because there is no single external customer whose net sales accounts for 10% or more of operating revenues on the Statements of Income.

<Notes to per unit information>

13th Fiscal Period



to July 31, 2017) Net assets per unit ¥165,863 ¥172,537

Profit per unit ¥4,548 ¥4,629

(Note 1) Profit per unit was calculated by dividing profit for the period by the daily weighted average number of investment units issued and outstanding. Profit per unit after adjusting for diluted units is not included because there were no diluted investment units.

(Note 2) The basis for calculating profit per unit is as follows:

13th Fiscal Period



to July 31, 2017) Profit (thousands of yen) 2,335,864 2,608,216 Amount not attributable to common unitholders (thousands of yen) －－

Profit attributable to common investment units (thousands of yen) 2,335,864 2,608,216

Average number of investment units for the period (units) 513,504 563,416

<Notes to significant subsequent events> Not applicable

7. Supplementary schedules (i) Supplementary schedule of investment securities

Not applicable

(ii) Information on contract amount and fair value of derivative transactions and forward exchange contracts Information on derivative transactions and forward exchange contracts entered into by the Investment Corporation as of July 31, 2017 is as follows.

(Thousands of yen)

Classification Type Contract amount (Note 1)

Fair value (Note 2) Maturing after 1

year

Over-the-counter transactions Receive floating, pay fixed interest-rate swap transactions 55,645,000 48,745,000 –

Total 55,645,000 48,745,000 – (Note 1) The contract amount of interest-rate swap transactions is based on the notional principal. (Note 2) Fair value is evaluated based on the value calculated by the counterparty of the contract using market interest rate, etc. Disclosure of fair value

is omitted for the transactions that meet the requirements for special treatment pursuant to the Accounting Standard for Financial Instruments.

(iii) Condensed supplementary schedule of real estate properties (Thousands of yen)

Asset type Balance at

beginning of current period

Increase during period

Decrease during period

Balance at end of current

period

Accumulated depreciation

Net balance at end of current

period Remarks

or accumulated amortization

at end of current period

Depreciation or

amortization during period

Prop

erty

, pla

nt a

nd e

quip

men

t

Buildings 1,895,400 503 - 1,895,903 87,598 21,627 1,808,305

Structures 21,514 - - 21,514 2,367 682 19,146 Machinery and equipment 17,687 - - 17,687 639 274 17,048

Tools, furniture and fixtures

1,628 - - 1,628 217 145 1,411

Land 2,405,775 - - 2,405,775 - - 2,405,775 Buildings in trust 81,019,743 7,448,418 - 88,468,161 7,476,802 1,036,903 80,991,359 (Note)

Structures in trust 1,085,525 44,734 - 1,130,260 229,113 28,456 901,146

Machinery and equipment in trust

1,471,940 85,569 - 1,557,509 198,577 27,467 1,358,931

Tools, furniture and fixtures in trust

125,460 59,409 - 184,869 52,433 13,285 132,435

Land in trust 87,211,899 13,012,424 - 100,224,324 - - 100,224,324 (Note)

Total 175,256,576 20,651,059 - 195,907,635 8,047,750 1,128,842 187,859,884

Inta

ngib

le

asse

ts

Leasehold rights in trust 1,226,269 - - 1,226,269 25,696 8,565 1,200,572

Other 30,423 720 - 31,144 15,116 3,114 16,027

Total 1,256,692 720 - 1,257,413 40,813 11,679 1,216,600 (Note) Increases during the 14th Fiscal Period are due primarily to the acquisition of real estate for rental purposes. The details are as follows.

60 61

(Thousands of yen)

Property name Increase during period

COMFORIA AKIHABARA EAST 4,561,572

COMFORIA MITA TROIS 948,100

COMFORIA BUNKYOHAKUSAN 1,414,865

COMFORIA KAMATA 5,917,707

COLLEGE COURT HACHIMANYAMA 1,297,361

COMFORIA SHINSAIBASHI EAST 2,079,658

COMFORIA KYOMACHIBORI 1,638,285

COMFORIA AWAZA 1,359,634

COMFORIA GYOTOKU 1,051,044

(iv) Supplementary schedule of other specified assets Not applicable (v) Supplementary schedule of investment corporation bonds

(Thousands of yen)

Bond name Issuance date

Balance at beginning of current

period

Increase during period

Decrease during period


Coupon rate (%)

Redemption date

Use of funds Security

The Investment Corporation 1st

unsecured bonds (Note 1)

July 30, 2014 3,000,000 - - 3,000,000 0.64000 July 30,

2021 (Note 2) Unsecured


2nd unsecured bonds (Note 1)

July 18, 2017 - 1,000,000 - 1,000,000 0.23000 July 15,



3rd unsecured bonds (Note 1)

July 18, 2017 - 2,000,000 - 2,000,000 0.52000 July 16,


Total 3,000,000 3,000,000 - 6,000,000

(Note 1) The bonds are subject to the pari passu clause among specified investment corporation bonds. (Note 2) The funds are appropriated to acquire of real estate in trust and repayment of certain existing borrowings. (Note 3) The total amount of redemption of investment corporation bonds for each year during the five years following the balance sheet date is as shown

below. (Thousands of yen)






- - - 3,000,000 1,000,000 2,000,000

(vi) Supplementary schedule of borrowings Information on the Investment Corporation’s borrowings as of July 31, 2017 is as follows:

Classification Balance at beginning of

current period (thousands of

yen)

Increase during period (thousands of

yen)

Decrease during period (thousands of

yen)


period (thousands of

yen)

Average interest rate

(%) (Note 2)

Maturity date

Repayment method


Lender

Short-term loans

payable

Mizuho Trust & Banking Co., Ltd. - 1,000,000 1,000,000 - 0.23000 May 31,

2018 (Note 4)

Lump-sum repayment (Note 5) Unsecured

Unguaranteed

Subtotal - 1,000,000 1,000,000 - - - - - -

Long

-term

loan

s pay

able

(Not

e 1)

Mizuho Bank, Ltd. 3,570,000 - - 3,570,000 0.53000

March 23, 2019


Unguaranteed

Sumitomo Mitsui Trust Bank, Limited 3,570,000 - - 3,570,000 0.53000

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 3,570,000 - - 3,570,000 0.53000

Sumitomo Mitsui Banking Corporation 1,785,000 - - 1,785,000 0.53000

Development Bank of Japan Inc. 1,090,000 - - 1,090,000 1.41200

September 29, 2017


Unguaranteed

Mizuho Bank, Ltd. 1,090,000 - - 1,090,000 1.41200



Mitsubishi UFJ Trust and Banking Corporation 1,090,000 - - 1,090,000 1.41200

Sumitomo Mitsui Banking Corporation 550,000 - - 550,000 1.41200

The Tokyo Tomin Bank, Limited 300,000 - - 300,000 1.41200

Mitsubishi UFJ Trust and Banking Corporation 2,000,000 - - 2,000,000 0.79500 August 31,

2018 Lump-sum repayment (Note 5) Unsecured

Unguaranteed

Mizuho Bank, Ltd. 1,350,000 - - 1,350,000 0.67075

March 30, 2018


Unguaranteed




Development Bank of Japan Inc. 1,350,000 - - 1,350,000 0.90487 September 30, 2019


Unguaranteed

62 63



yen)


yen)


yen)



yen)


(%) (Note 2)

Maturity date

Repayment method


Lender

Long

-term

loan

s pay

able

(Not

e 1)


January 31, 2019


Unguaranteed

Mizuho Bank, Ltd. 1,000,000 - - 1,000,000 0.60700






January 31, 2021


Unguaranteed

Mizuho Bank, Ltd. 1,000,000 - - 1,000,000 0.88240





Development Bank of Japan Inc. 670,000 - - 670,000 0.60150

June 30, 2020


Unguaranteed

Mizuho Bank, Ltd. 670,000 - - 670,000 0.60150

Sumitomo Mitsui Trust Bank, Limited 670,000 - - 670,000 0.60150

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 670,000 - - 670,000 0.60150

Mitsubishi UFJ Trust and Banking Corporation 670,000 - - 670,000 0.60150



June 30, 2022


Unguaranteed

Mizuho Bank, Ltd. 910,000 - - 910,000 0.90100





Shinkin Central Bank 750,000 - - 750,000 0.30820

March 30, 2018


Unguaranteed The Norinchukin Bank 750,000 - - 750,000 0.30820

The Bank of Fukuoka, Ltd. 750,000 - - 750,000 0.30820


January 31, 2022


Unguaranteed

Mizuho Bank, Ltd. 600,000 - - 600,000 0.69250






January 31, 2023


Unguaranteed

Mizuho Bank, Ltd. 620,000 - - 620,000 0.79875






January 31, 2025


Unguaranteed

Mizuho Bank, Ltd. 620,000 - - 620,000 1.04200







yen)


yen)


yen)



yen)


(%) (Note 2)

Maturity date Repayment method


Lender

Long

-term

loan

s pay

able

(Not

e 1)


March 31, 2023


Unguaranteed

Mizuho Bank, Ltd. 360,000 - - 360,000 0.58430






August 31, 2023


Unguaranteed

Mizuho Bank, Ltd. 420,000 - - 420,000 0.62460






February 29, 2024


Unguaranteed

Mizuho Bank, Ltd. 490,000 - - 490,000 0.67745






March 31, 2021


Unguaranteed


The Tokyo Tomin Bank, Limited 1,000,000 - - 1,000,000 0.27125



March 31, 2025


Unguaranteed Mitsubishi UFJ Trust and Banking Corporation 2,000,000 - - 2,000,000 0.61950



July 31, 2024


Unguaranteed

Mizuho Bank, Ltd. 580,000 - - 580,000 0.46655






July 31, 2026


Unguaranteed

Mizuho Bank, Ltd. 900,000 - - 900,000 0.65518





64 65



yen)


yen)


yen)



yen)


(%) (Note 2)

Maturity date

Repayment method


Lender

Long

-term

loan

s pay

able

(Not

e 1)

Mizuho Trust & Banking Co., Ltd. 1,550,000 - 1,550,000 - 0.20909 September 30, 2017 (Note 3)


Unguaranteed

Mitsubishi UFJ Trust and Banking Corporation 990,000 - 990,000 - 0.23000

December 29, 2017 (Note 3)


Unguaranteed

Mizuho Trust & Banking Co., Ltd. 2,000,000 - - 2,000,000 0.46691

January 31, 2022


Unguaranteed

The Norinchukin Bank 1,500,000 - - 1,500,000 0.46691

The Bank of Fukuoka, Ltd. 1,000,000 - - 1,000,000 0.46691

The 77 Bank, Ltd. 500,000 - - 500,000 0.46691

The Daishi Bank, Ltd. 500,000 - - 500,000 0.46691

Mizuho Bank, Ltd. - 440,000 440,000 - 0.22967

February 28, 2018

(Note 4)


Unguaranteed

Sumitomo Mitsui Trust Bank, Limited - 440,000 440,000 - 0.22967

The Bank of Tokyo-Mitsubishi UFJ, Ltd. - 440,000 440,000 - 0.22967

Mitsubishi UFJ Trust and Banking Corporation - 440,000 440,000 - 0.22967

Sumitomo Mitsui Banking Corporation - 240,000 240,000 - 0.22967

Development Bank of Japan Inc. - 580,000 - 580,000 0.62938

January 31, 2024


Unguaranteed

Mizuho Bank, Ltd. - 580,000 - 580,000 0.62938

Sumitomo Mitsui Trust Bank, Limited - 580,000 - 580,000 0.62938

The Bank of Tokyo-Mitsubishi UFJ, Ltd. - 580,000 - 580,000 0.62938

Mitsubishi UFJ Trust and Banking Corporation - 580,000 - 580,000 0.62938

Sumitomo Mitsui Banking Corporation - 290,000 - 290,000 0.62938

Development Bank of Japan Inc. - 910,000 - 910,000 0.79571

January 30, 2026


Unguaranteed

Mizuho Bank, Ltd. - 910,000 - 910,000 0.79571

Sumitomo Mitsui Trust Bank, Limited - 910,000 - 910,000 0.79571

The Bank of Tokyo-Mitsubishi UFJ, Ltd. - 910,000 - 910,000 0.79571

Mitsubishi UFJ Trust and Banking Corporation - 910,000 - 910,000 0.79571

Sumitomo Mitsui Banking Corporation - 450,000 - 450,000 0.79571

Subtotal 91,970,000 10,190,000 4,540,000 97,620,000 - - - - -

Total 91,970,000 11,190,000 5,540,000 97,620,000

(Note 1) Long-term loans payable include the current portion of long-term loans payable. (Note 2) The average interest rate is the interest rate for each loan contract rounded to the fifth decimal place. As for the borrowings hedged by interest-

rate swap transactions in order to avoid interest rate fluctuation risk, the interest rates reflect the effect of interest-rate swap transactions. (Note 3) The amount was repaid in full ahead of schedule on February 2, 2017. (Note 4) The amount was repaid in full ahead of schedule on July 18, 2017. (Note 5) The use of funds is mainly for the acquisition of real estate in trust and repayment of existing borrowings, etc. (Note 6) The total amount of repayment of long-term loans payable for each year during the five years following the balance sheet date is as shown

below.

(Thousands of yen) Due in 1 year or

less Due after 1 year

to 2 years Due after 2 years




13,200,000 19,995,000 5,050,000 10,425,000 13,800,000 35,150,000

66 67

For a Superior Level of Living Comfort

Documents

Transcript of For a Superior Level of Living Comfort