Notice concerning the Acquisition and Transfer of Property

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Disclaimer: This press release is an announcement concerning the acquisition and transfer of property of Hulic Reit and

was not prepared for the purpose of soliciting investment. When investing, Hulic Reit advises investors to do

so at their own responsibility and discretion, after carefully reading the prospectus on the issuance of new

investment units and the secondary offering of investment units as well as any amendments prepared by Hulic

Reit.

Translation Purposes Only

To All Concerned Parties

March 26, 2021

Name of REIT Issuer:

Hulic Reit, Inc.

2-26-9 Hatchobori, Chuo-ku, Tokyo, Japan Eiji Tokita, Executive Officer

(TSE Code: 3295)

Contact:

Asset Management Company

Hulic REIT Management Co., Ltd.

Kazuaki Chokki, President and CEO

Person to Contact:

Hiroshi Machiba, CFO, Head of Planning and

Administration Division and General Manager of

Finance and Planning Department

Tel: +81-3-6222-7250

Notice concerning the Acquisition and Transfer of Property

TOKYO, March 26, 2021 – Hulic Reit, Inc. (“Hulic Reit”) announces that Hulic REIT Management Co., Ltd.

(“Hulic REIT Management”), which is entrusted with the management of the assets of Hulic Reit, has made the

decision today to acquire (“Acquisition”) and transfer (“Transfer”) the properties listed below (hereinafter

individually or collectively referred to as the “Property”).

Since the counterparty to the Acquisition of the Property includes an Interested Person, etc. (as defined in item 3 of

Notes below) of Hulic REIT Management, and is an interested party according to Hulic REIT Management’s

Regulations on Transactions with Interested Parties, the necessary procedures stipulated in the Act on Investment

Trusts and Investment Corporations (Act No. 198 of 1951, as amended) (“Act”) and Hulic REIT Management’s

internal policies (including Regulations on Transactions with Interested Parties) have been completed concerning the

Acquisition.

1. Overview of the acquisition and transfer

(A) Assets planned for acquisition

(1) (2) (3) (4) (5) (6) (7)

Category Property name Location Assets scheduled to

be acquired

Anticipated

acquisition price

(Millions of yen)

(Note 1)

Seller Presence of

Intermediary

Tokyo Commercial Property

Office Hulic Ueno

Building Taito-ku, Tokyo

Real estate trust

beneficiary rights

(Note 2)

4,100 Hulic Co.,

Ltd. (Note 3) None

Next-Generation Assets Plus

Private

nursing

homes

Hulic Chofu Chofu-shi, Tokyo Real estate trust

beneficiary rights 3,340

Hulic Co.,

Ltd. (Note 3) None

Total －－ 7,440 －－

(8) Acquisition decision date : March 26, 2021

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(9) Date of purchase and sale agreement : March 26, 2021

(10) Anticipated acquisition date (Note 4) : March 31, 2021

(11) Payment date (Note 4) : March 31, 2021

(12) Acquisition funds : Cash reserves and proceeds from the Transfer

(13) Settlement method : Full payment upon delivery Notes:

1. “Anticipated acquisition price” does not include consumption or local taxes or the costs and expenses related to the

acquisition.

2. This is a trust beneficiary right whereby the trust assets consist of ownership rights for a bank branch

building and its site and co-ownership interests (50.0%) in unit ownership rights for tower parking on the

north side of the parking lot, as well as quasi-co-ownership interests (50.0%) in other leaseholds on the site

of the parking lot based on a land rental agreement. We plan to acquire 90.0% of quasi-co-ownership in these

trust beneficiary rights.

3. Hulic Co., Ltd. is an Interested Person, etc. (as defined in Article 201 of the Act and Article 123 of the Order for

Enforcement of the Act on Investment Trusts and Investment Corporations (Cabinet Order No. 480 of 2000, as

amended); the same shall apply hereinafter) of Hulic REIT Management, and is an interested party according to Hulic

REIT Management’s Regulations on Transactions with Interested Parties.

4. The anticipated acquisition date and payment date are stated in the relevant purchase and sale agreement.

(B) Asset planned for transfer

(1) Category Tokyo Commercial Property (Office)

(2) Property name Shinagawa Season Terrace

(3) Location Minato-ku, Tokyo

(4) Asset planned for transfer Real estate trust beneficiary rights (Note 1)

(5) Anticipated transfer price (Note 2) 6,280 million yen

(6) Estimated book value (Note 3) 5,920 million yen

(7) Transfer difference (Note 4) +359 million yen

(8) Transfer decision date March 26, 2021

(9) Date of purchase and sale agreement March 26, 2021

(10) Anticipated transfer date (Note 5) March 30, 2021

(11) Date payment received (Note 5) March 30, 2021

(12) Counterparty to the transfer Undisclosed (Note 6)

(13) Presence of intermediary None

(14) Transferred funds The balance after the allocation of gain from the transfer

(Note 7) is expected to be applied toward the price of the

Acquisition.

(15) Settlement method Full payment upon delivery

Notes:

1. We plan to transfer 25.0% (all of Hulic Reit's equity) of quasi-co-ownership interest in trust beneficiary

rights whereby the trust assets are co-ownership interests in unit ownership rights for the stores, assembly

hall, and clinic from the first floor to the third floor and the offices from the sixth floor to the te nth floor and

the eighteenth floor to the twenty-sixth floor (18.0%), co-ownership interests in the offices on the fifth floor

(approximately 3.4%), quasi-co-ownership interests in other leaseholds for the building site based on a land

rental agreement (approximately 9.5%) and land use lease rights for the land near the building (18.0%).

2. ”Anticipated transfer price” does not include consumption or local taxes or the costs and expenses related to the

transfer.

3. Estimated book value as of the anticipated transfer date rounds down units of less than one million yen.

4. The difference between the anticipated transfer price and estimated book value rounds down units of less

than one million yen.

5. The anticipated transfer date and payment date are stated in the purchase and sale agreement.

6. The counterparty to the transfer is a company based in Japan. Further information is undisclosed because the

counterparty has not consented to such disclosure.

7. We expect to set aside part of the gains on transfer (about 69 million yen) as internal reserves.

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2. Reason for acquisition and transfer


In accordance with the basic policies of Hulic Reit, the purpose of acquiring the Property is to improve the

portfolio. Hulic REIT Management has assessed each property based on the following factors:

・Hulic Ueno Building

1) Characteristics of the location

This property is located on the corner of an area lined with office buildings along Chuo Dori, which is a

three-minute walk from Ueno Hirokoji Station, the nearest station, on the Tokyo Metro Ginza Line. In

addition to the nearest station, this property is within walking distance of many train stations, including

Okachimachi Station on the JR Yamanote Line, among other lines, and Yushima Station on the Tokyo Metro

Chiyoda Line. This property is very close to the city center and has outstanding access to transportation.

The Ueno-Okachimachi area in which the property is located has long been a densely concentrated commercial

and industrial district centered around Ueno Station. Ueno Station functions as a terminal hub in which

passengers can access many train lines, including Shinkansen, JR conventional lines, subways, and private

railway lines, positioning this station as the northern entrance to Tokyo. In addition, many companies have

established bases in this area to oversee their operations in Joto and Johoku areas in Tokyo. This property's

location along the major road gives it excellent visibility in the Ueno-Okachimachi area, and ample frontage has

been secured as well. As such, we believe this property should be evaluated highly.

2) Characteristics of the property

This property is an office building with one floor below ground and eight floors above ground. The first

through fourth floors and the sixth floor are occupied by a bank, the fifth and seventh floors are sales offices

for customer visits (part of the fifth floor is occupied by a bank) and the eighth floor consists of offices.

It is a small-to-medium-scale office building with a total floor space of approximately 4,376 m2

(approximately 1,323 tsubo) (Note) and a standard area per floor of approximately 450 m2 (approximately 136

tsubo), which is the most popular size in this area and neighboring areas. Uniform shapes of rental units and

highly efficient space usages are both factors that we believe will be popular among tenants.

Ceilings are 2,550 mm high (comparable with OA in the future) and both individual air-conditioning systems

and central air systems are available. These satisfy basic specifications that will meet general tenant needs.

This property was completed in 1986, but given that many office buildings near this site were also completed

around the same time (among other factors), we believe that this building will be valued highly in this area.

Given these factors, we have determined that this property has a certain competitiveness in terms of site,

scale and facilities.

Note:

This building consists of two buildings⸻the bank branch building and a parking lot⸻but the figures provided here are

based on the entries in the property registry for the bank building.

・Hulic Chofu

1) Characteristics of the location

This property is located a five-minute walk from Chofu Station on Keio Railway's Keio Line.

The nearest station, Chofu Station, has many retail facilities such as Parco and Seiyu nearby.

Additionally, it only takes fifteen minutes from Chofu Station to Shinjuku Station via Keio Railway’s Keio

Line limited express train, allowing high accessibility. These are factors that makes this area appealing to

active seniors, a demographic class that has been increasing in recent years. We believe that, in addition to

the location’s accessibility and convenience, its rich scenic nature, such as Jindaiji Temple and the Tama

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River, in the surrounding areas makes the area an ideal residential environment.

2) Characteristics of the property

This property is a welfare and service mixed-use building that primarily serves as a high-end private

nursing home, and was completed in March 2017. The building has eight above-ground floors, with the first

and second floors occupied by a pharmacy, clinic and others, while the third through eighth floors constitute

the private nursing home.

The private nursing home has individual residential rooms on the fourth floor partially and the fifth

through eighth floors. Common areas include a reception area, offices, visiting room, kitchen, mechanized

bathroom, and multi-purpose rooms on the third floor, and individual residential rooms, a dining

hall/training room, kitchen, bathrooms and other on the fourth floor. It houses a total of 84 rooms with a

capacity of 84 residents, a scale that is relatively large-compared to competing facilities.

The exterior's monotone façade, and the interior design with wood-grained doors and carpets in calming

colors create a prestigious ambience. The tables provided for residents in the dining hall can be separated as

a measure to prevent coronavirus infections among residents. In addition, clinics and other facilities on the

first through second floors give residents a sense of reassurance.

The building also has adopted a solar power generation system, LED lighting throughout the building,

natural ventilation systems and multi-layered glass in all residential rooms, which helps to conserve energy

and reduce CO2. In addition, provisions in the event of a disaster have been stockpiled, the building is built

to withstand an earthquake of 1.25 times the impact stipulated in the Building Standard Law, and escape

balconies have been set up from the third floor and above so that all residents and staff can seek temporary

refuge. As such, BCP measures and a long-life design have been incorporated with this property.

(B) Assets planned for transfer

Based on the basic policies of Hulic Reit, Hulic REIT Management is building a portfolio in accordance with

comprehensive decisions in consideration of the competitiveness, etc. of each property along with the growth

potential, profitability, and risk factors for the portfolio overall.

The decision to transfer this property was made on the basis of a comprehensive assessment of individual

factors such as the type of ownership for the property and taking into account the possibility that its revenue

potential could decrease in the future.

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3. Overview of the Properties


・Hulic Ueno Building (Note 1)

Specified assets category Real estate trust beneficiary rights

Anticipated acquisition price 4,100 million yen

Trustee Mizuho Trust & Banking Co., Ltd.

Date trust initiated March 31, 2021

Expiration date of trust period March 31, 2031

Nearest station Three-minute walk from Ueno Hirokoji Station on Tokyo Metro Ginza Line

Address (domicile) (Bank branch building) 3-16-5 Ueno, Taito-ku, Tokyo

(Parking lot) 3-15-1 Ueno, Taito-ku, Tokyo

Land

Lot number (Bank branch building) 3-4-1 Ueno, Taito-ku, Tokyo and others

(Parking lot) 3-6-4 Ueno, Taito-ku, Tokyo

Building-to-land ratio (Bank branch building) 100% (Note 2)

(Parking lot) 90% (Note 3)

Floor-area ratio (Bank branch building) 700%

(Parking lot) 600%

Zoning (Bank branch building) Commercial area

(Parking lot) Commercial area

Site area (Bank branch building) 647.43 m2 (Note 4)

(Parking lot) 234.15 m2 (Note 4)

Type of ownership

(Bank branch building) Proprietary ownership (quasi-co-ownership interest of

90.0%)

(Parking lot) Leasehold interest (Note 5)

Building

Completed (Bank branch building) April 1986

(Parking lot) March 1986

Structure (Bank branch building) SRC

(Parking lot) S

Number of floors (Bank branch building) 8F/B1

(Parking lot) One-story structure

Use (Bank branch building) Bank and Office

(Parking lot) Parking lot

Total floor space (Bank branch building) 4,376.30 m2 (Note 6)

(Parking lot) 101.45 m2 (Note 6)

Number of parking

spaces

(Bank branch building) －

(Parking lot) 18 (Note 7)

Type of ownership

(Bank branch building) Unit ownership rights (quasi-co-ownership interest of

90.0%) (Note 8)

(Parking lot) Co-ownership in unit ownership rights (quasi-co-ownership

interest of 90.0%) (Note 9)

Collateral None

PM company Hulic Co., Ltd. (anticipated) (Note 10)

Master lease company Hulic Co., Ltd. (anticipated) (Note 10)

Appraisal value 4,284 million yen (Note 11)

(Date of valuation) (February 1, 2021)

Appraisal company Japan Real Estate Institute

PML 5.72% (Note 12)

Details of Tenant (Note 13)

Total leased floor space 3,031.85 m2 (Note 14)

Total leasable floor space 3,031.85 m2 (Note 14)

Occupancy rate 100.0%

Main tenant Undisclosed (Note 15)

Total number of tenants 4

Total lease income (annualized) 210 million yen (Note 14) (Note 16)

Lease and guarantee deposits 190 million yen (Note 14) (Note 17)

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Special remarks Preferential negotiation rights for purchase of mutual quasi-co-ownership

interests are granted to quasi-co-owners.

Notes:

1. Details are as of the anticipated acquisition date, confirmed as of March 26, 2021.

2. The designated building-to-land ratio of the land of the Property is 80%; however, since the building is a fire-

resistant building within a fire prevention area, the applied building-to-land ratio is 100%.

3. The designated building-to-land ratio of the land of the Property is 80%, but the actual applicable ratio was set at

90% as it is located on a corner.

4. Based on the entry in the property registry. The actual status may differ in some cases. This figure includes the site

area of the entire building.

5. The land to be acquired has a 90.0% quasi-co-ownership interest in trust beneficiary rights in which some of the

trust assets are a quasi-co-ownership interest (50.0%) in leaseholds for the building site based on a land rental

agreement.

6. Based on the entry in the property registry. This figure includes the site area of the entire building.

7. The figure noted does not include the regular parking lot located in the section owned exclusively by other unit

owners.

8. Hulic Reit will have unit co-ownership in this property, but it plans to acquire 90.0% interest in the trust beneficiary

rights acquired under quasi-co-ownership, with part of the assets under trust being the single building and its site

overall (100%).

9. With the acquisition of this property, Hulic Reit will acquire a 90.0% interest in the trust beneficiary rights acquired

under quasi-co-ownership, with part of the assets under trust being a co-ownership in unit ownership interests in the

tower parking lot on the north side of the parking lot (50.0%).

10. Hulic Co., Ltd. is an Interested Person, etc. of Hulic REIT Management, and is an interested party according to Hulic

REIT Management’s Regulations on Transactions with Interested Parties.

11. The price equals the quasi-co-ownership interest expected to be acquired by Hulic Reit is stated.

12. The figure is based on the earthquake PML appraisal report by Sompo Risk Management Inc.

13. As the trustee and the master lease company enter into a pass-through master lease agreement with no rent guarantee,

total leased floor space, occupancy rate, total number of tenants, total lease income, and lease and guarantee deposits

of the end-tenants subleased by the master lease company are indicated in the “Details of Tenant.”

14. The figure equals the quasi-co-ownership interest to be acquired by Hulic Reit.

15. Not disclosed because approval for disclosure has not been acquired from the tenant.

16. The annualized amount is calculated by multiplying the total amount of monthly rent in each lease agreement with

end-tenants (including common services fees; limited to rent for rooms that are occupied by tenants and excluding

fees for using warehouses, signboards, and parking lots; also not taking free rent, etc. into consideration and

excluding consumption taxes) by 12 and rounding to the nearest million yen.

17. Total lease and guarantee deposits in each lease agreement with end-tenants are rounded to the nearest million yen.

・Hulic Chofu (Note 1)

Specified assets category Real estate trust beneficiary rights

Anticipated acquisition price 3,340 million yen

Trustee Mitsubishi UFJ Trust and Banking Corporation

Date trust initiated March 31, 2021

Expiration date of trust period March 31, 2031

Nearest station Five-minute walk from Chofu Station on Keio Railway's Keio Line

Address (domicile) 1-14-3 Kojimacho, Chofu-shi, Tokyo

Land

Lot number 1-14-3 Kojimacho, Chofu-shi, Tokyo and others

Building-to-land ratio 100% (Note 2)

Floor-area ratio 500%・300% (Note 3)

Zoning Commercial area, Neighborhood commercial area (Note 3)

Site area 1,168.05 m2 (Note 4)

Type of ownership Proprietary ownership

Building

Completed March 2017

Structure RC

Number of floors 8F

Use Private nursing home, Clinic and Shops

Total floor space 4,343.38 m2 (Note 5)

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Number of parking

spaces 15

Type of ownership Proprietary ownership

Collateral None

PM company Hulic Co., Ltd. (anticipated) (Note 6)

Master lease company Hulic Co., Ltd. (anticipated) (Note 6)

Operator Charm Care Corporation Co., Ltd. (Note 7)

Back-up operator None

Appraisal value 3,430 million yen

(Date of valuation) (February 1, 2021)

Appraisal company Japan Real Estate Institute

PML 3.32 % (Note 8)

Details of Tenant (Note 9)

Total leased floor space 4,357.58 m2

Total leasable floor space 4,357.58 m2

Occupancy rate 100.0%

Main tenant Charm Care Corporation Co., Ltd. (Note 10)

Total number of tenants 7

Total lease income (annualized) 173 million yen (Note 11)

Lease and guarantee deposits 144 million yen (Note 12)

Special remarks Preferential negotiating rights for purchase of the property were granted to the

end tenant of private nursing home.

Notes:

1. Details are as of the anticipated acquisition date, confirmed as of March 26, 2021.

2. The designated building-to-land ratio of this property's land is 80%; however, since the building is a fire-resistant

building within a fire prevention area, the applied building-to-land ratio is 100%.

3. The portion of the property within 20 meters of the road on the south is designated for commercial area and has a

floor-area ratio of 500%. The area over 20 meters from the road on the south is designated as a neighborhood

commercial area and has a floor-area ratio of 300%.

4. Based on the entry in the property registry. The actual status may differ in some cases.

5. Based on the entry in the property registry.

6. Hulic Co., Ltd. is an Interested Person, etc. of Hulic REIT Management, and is an interested party according to

Hulic REIT Management’s Regulations on Transactions with Interested Parties.

7. A care service provider that operates a fee-based home for the aged is indicated.

8. The figure is based on the earthquake PML appraisal report by Sompo Risk Management Inc.

9. As the trustee and the master lease company enter into a pass-through master lease agreement with no rent

guarantee, total leased floor space, occupancy rate, total number of tenants, total lease income, and lease and

guarantee deposits of the end-tenants subleased by the master lease company are indicated in the “Details of

Tenant.”

10. The lease agreement with the end-tenant includes the rental agreement for the private nursing home. The outline of

this rental agreement is as follows.

Form of agreement : Ordinary building lease agreement for the purpose of operating a private nursing home

Period : April 21, 2017 to July 20, 2047

Revision of rent : The rent will not be revised during the duration of the aforementioned lease agreement. However,

the lessor and the lessee may discuss revision of the rent in the event of substantial fluctuations in taxes and public

dues, changes in the rent of similar buildings in the surrounding area, or other factors relating to economic

conditions. However, the rent will not be affected by revisions to or new passage of laws and ordinances, such as the

Long-Term Care Insurance Act.

Renewal of agreement: The term of lease agreement can be renewed for a period of 3 years up until 6 months before

the expiration date of the current lease term, unless the lessor or lessee indicate that they will not renew the

agreement. The terms of the rental agreement can be discussed at that point between the lessor and the lessee and

can be renewed every subsequent 3 years in line with this example.

Termination during the lease term: If the lessee or lessor wants to terminate the lease agreement during the lease

term for his/her own reasons, the lessee or lessor must notify the opposite party in writing at least 12 months before

the expiration date. In the event that the lessor terminates the agreement or the lessee requests termination during the

lease term, the lessee will pay the lessor a settlement payment determined in a separate lease agreement.

11. The annualized amount is calculated by multiplying the total amount of monthly rent in each lease agreement with

end-tenants (including common services fees; limited to rent for rooms that are occupied by tenants and excluding

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fees for using warehouses, signboards, and parking lots; also not taking free rent, etc. into consideration and

excluding consumption taxes) by 12 and rounding to the nearest million yen.

12. Total lease and guarantee deposits in each lease agreement with end-tenants are rounded to the nearest million yen.

Status of Tenants and Overview of Facilities (Date of Statement of Material Matters: February 1, 2021)

Facility type With nursing care (basic

type) Opening date May 1, 2017

Tenant rights format Usage rights Number of rooms 84

Living space floor area

(m2) 18.00 Capacity (persons) 84

Tenancy requirements Mixed type (excluding

independence)

Number of tenants

(persons) 79

Average tenant age 87.6 Occupancy rate (%) 94

Method of payment of fees Lump-sum payment Monthly payment

Occupancy lump-

sum fee (yen)

4,200,000 to 8,400,000 －

Monthly use fee

(yen)

216,140 to 286,140 356,140

Personnel systems relating

to nursing care

At least 2.5:1 Night time personnel

system

(Minimum number of

workers)

Minimum 4 care staff

Minimum 0 nursing staff


For information on the asset for transfer, please refer to the table on the Shinagawa Season Terrace property

in “Chapter 1. Fund Information, Part 1. Fund status, 5. Status of operation, (2) Invested assets, (3) Other

primary invested assets, I. Overview of Property, etc.” in the securities report submitted on November 24, 2020.

4. Overview of Operator

・Hulic Chofu

Trade name Charm Care Corporation Co., Ltd.

Location 19th floor, Daibiru-Honkan Building, 3-6-32 Nakanoshima, Kita-ku, Osaka

Name and title of

representative President, Representative Director Takahiko Shimomura

Primary business lines Operation and other of fee-based homes for the elderly and homes for the elderly with

services

Business Overview Development and operation of assisted-living fee-based homes for the elderly under the

brands “Charm,” “Charm Suite,” “Charm Premier;” and “Charm Premier Gran”; listed in

the first section of the TSE

Paid-in capital 2,759 million yen (as of December 31, 2020)

Date of establishment August 22, 1984 Number of facilities operated 62 (as of December 31, 2020) (Note)

Number of tenant rooms

operated 4,191 (as of December 31, 2020) (Note)

Net sales 19,619 million yen (as of June, 2020) (Note)

Ordinary income 1,835 million yen (as of June, 2020) (Note)

Relationship with Hulic Reit and Hulic REIT Management

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Capital relationship

There are no significant capital relationships among Hulic Reit, Hulic REIT Management,

and Charm Care Corporation Co., Ltd. There are no significant capital relationships

between the related persons or affiliates of Hulic Reit, Hulic REIT Management, and

Charm Care Corporation Co., Ltd.

Personnel relationship

There are no significant personnel relationships among Hulic Reit, Hulic REIT

Management, and Charm Care Corporation Co., Ltd. There are no significant personnel

relationships between the related persons or affiliates of Hulic Reit, Hulic REIT

Management, and Charm Care Corporation Co., Ltd.

Transactional

relationship

An end-tenant and operator of assets owned by Hulic Reit; executed a lease agreement

with the master lease company (Hulic Co., Ltd.).

Status as a related party

Charm Care Corporation Co., Ltd does not constitute a related party of Hulic Reit and

Hulic REIT Management. In addition, parties or affiliates related to Charm Care

Corporation Co., Ltd do not constitute related parties of Hulic Reit and Hulic REIT

Management.

Note:

Charm Care Corporation’s number of facilities under management, number of rooms under management, sales, and

ordinary income are the figures released by the company.

5. Overview of the counterparty of the acquisition and transfer


Trade name Hulic Co., Ltd.

Location 7-3 Nihonbashi Odenmacho, Chuo-ku, Tokyo

Name and title of

representative President, Representative Director Manabu Yoshidome

Primary business lines Holding, lease, purchase, and sale of real estate and brokerage services

Paid-in capital 62,718 million yen (as of December 31, 2020)

Date of establishment March 26, 1957 Net assets 489,043 million yen (as of December 31, 2020)

Total assets 2,019,336 million yen (as of December 31, 2020)

Major shareholders and

shareholding ratios

Meiji Yasuda Life Insurance Company (7.07%), Sompo Japan Insurance Inc. (6.27%),

Tokyo Tatemono Co., Ltd. (6.21%), Fuyo General Lease Co.,Ltd. (6.04%) (as of

December 31, 2020)

Relationship with Hulic Reit and Hulic REIT Management

Capital relationship

As of today, Hulic Co., Ltd. holds approximately 10.95% of the total number of

investment units issued by Hulic Reit. Hulic Co., Ltd. is the parent company (100%

investment ratio) of Hulic REIT Management, and is therefore an Interested Person, etc.

of Hulic REIT Management.

Personnel relationship

As of today, certain employees of Hulic REIT Management are on secondment from

Hulic Co., Ltd.

Transactional

relationship

Hulic Reit acquired two properties (8,100 million yen) and transferred two properties

(5,650 million yen) (including spin off) in the fiscal period ended February 28, 2021, and

transferred one property (1,945 million yen) (spin off) in the fiscal period ending August

31, 2021 from/to Hulic Co., Ltd.

Status as a related party

Hulic Co., Ltd. is a related party of Hulic Reit and Hulic REIT Management. Moreover,

as described above, Hulic Co., Ltd. is an Interested Person, etc. of Hulic REIT

Management.


This property will be transferred to a general business company in Japan, but further information cannot be

disclosed as this company has not authorized the disclosure of its name and other information. As of this date,

there are no capital relationships, personal relationships, or business relationships worthy of note between the

seller and Hulic Reit and Hulic REIT Management, or the parties or affiliates related to Hulic Reit and Hulic REIT

Management, and the seller is not a related party of Hulic Reit and Hulic REIT Management.

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6. Status of the property acquirer

Property acquisition from a person that has special interests is as follows. In the table below, (i) the company

name/name, (ii) the relationship with the person that has special interests, and (iii) the background/reason for the

acquisition are indicated.

Property name

Location Previous owner / Trust beneficiary

Owner / Trust beneficiary prior to the

previous owner / trust beneficiary

(i), (ii), (iii)

Acquisition (transfer) price

Acquisition (transfer) date

(i), (ii), (iii)

Acquisition (transfer) price

Acquisition (transfer) date

Hulic Ueno Building

(3-16-5 and 3-15-1 Ueno, Taito-

ku, Tokyo)

(i) Hulic Co., Ltd.

(ii) Parent company of Hulic REIT

Management

(iii) Acquired for development purposes

Those other than a person that has

special interests

Omitted as the current owner/trust beneficiary

has owned the property for over a year －

(Bank branch building) April 1986, March

1998

(Parking lot) September, 1986

－

Hulic Chofu

(1-14-3 Kojimacho, Chofu-shi,

Tokyo)

(i) Hulic Co., Ltd.

(ii) Parent company of Hulic REIT

Management

(iii) Acquired with the intention of investment

Those other than a person that has

special interests

Omitted as the current owner/trust beneficiary

has owned the property for over a year －

March 1998, March 2014 －

7. Future outlook

For the operations forecast of Hulic Reit for the period ending August 2021 (March 1, 2021 to August 31, 2021)

or the period ending February 2022 (September 1, 2021 to February 28, 2022) resulting from the acquisition and

transfer of the property, please refer to “Notice concerning Revisions to the Forecasts of Financial Results, etc. for

the Fiscal Period Ended February 28, 2021 and the Fiscal Period Ending August 31, 2021 and Announcement of

Forecasts of Financial Results, etc. for the Fiscal Period Ending February 28, 2022” announced today.

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8. Summary of Appraisal Report


・Hulic Ueno Building

Appraisal value 4,284 million yen (Note 1) (Note 2)

Appraiser Japan Real Estate Institute

Date of valuation February 1, 2021

(Millions of yen)

Item Breakdown Remarks

Appraisal value based on income

method (Note 3) 4,760

Estimated with appraisal value based on direct capitalization

method and appraisal value based on DCF method handled

equally

Appraisal value based on direct

capitalization method 4,850

(1) Operating revenue 237

Potential gross income 243 Estimated based on evaluation of rent levels deemed stable in

the medium and long term

Losses from vacancy, etc. 6 Estimated based on evaluation of stable occupancy rate level

in the medium and long term (2) Operating expenses 57

Maintenance and management

fee/PM fee (Note 4) 20

Estimated taking into account the individual characteristics of

the target real estate, in reference to past results, expense

levels for similar real estate, etc.

Utility expenses 1 Estimated based on past results, after giving consideration to

expense levels, etc. for similar real estate

Repair expenses 3

Estimated based on past results, and in consideration of future

management and operation plans, expense levels for similar

real estate, and average annual repair and renewal expenses in

engineering reports

Tenant recruitment/solicitation

expenses, etc. 2

The figure noted here is the annual average amount estimated

based on an evaluation of the assumed turnover period for

lessees.

Taxes and public dues 26 Estimated based on materials related to taxes and public dues

and burden adjustment measures, etc.

Insurance premium 1 Estimated based on the premium rate for similar real estate,

etc.

Other expenses 3 Land rent and fees for exclusive use of roads are posted as

other expenses.

(3) Net operating income

(NOI: (1) - (2)) 180

(4) Profit from security

deposits 2

Estimated based on evaluation of lease deposit and

investment return

(5) Capital expenditures 7

Estimated taking into account capital expenditure levels for

similar real estate, the age of the building, and average annual

repair and renewal expenses, etc. in engineering reports

Net cash flow

(NCF: (3) + (4) - (5)) 175

Cap rate 3.6%

Estimated by adjusting the spread appropriate for the property

to be examined reflecting site conditions, building conditions

and other factors to the yield that is standard for the area,

comprehensively taking into account future uncertainty and

investment yields for similar real estate properties, etc.

Appraisal value based on DCF

method 4,670

Discount rate 3.4%

Estimated based on the investment yield for similar real estate

transactions, after taking into consideration the individuality

of the target real estate

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Terminal cap rate 3.8%

Estimated based on the investment yields of similar

properties, after taking into comprehensive consideration

factors including future trends in investment yields, risks

posed by the property in question as an investment, general

forecasts on economic growth in the future, and trends in real

estate prices and rents

Appraisal value based on cost method

(Note 3) 4,770

Ratio of land (Bank branch

building) 93.0 %

Ratio of building (Bank branch

building) 7.0 %

Ratio of land (Parking lot) 88.9%

Ratio of building (Parking lot) 11.1%

Other matters considered by appraiser in determination of

appraisal value

None

Notes:

1. Appraisal value based on the income method that reflects the profitability and investment return of the Property is

used.

2. An amount equals the quasi-co-ownership interest acquired by Hulic Reit (90.0%).

3. The appraisal value figures for the one building and its premises (single unit) have been rounded to the first decimal place

for figures less than 1 million yen (of which, the portion understood as attributable to Hulic Reit is equivalent to 90.0% of

quasi-co-ownership interest). Note that these figures are not the revenue and expenses forecast by Hulic Reit or Hulic REIT

Management.

4. The maintenance and management fee and PM fee stated above are combined, because individual disclosure of the

maintenance and management fee and PM fee amount levels may affect the other transactions of each contractor with respect

to building management and PM services, which could pose an obstacle to efficient performance of services by Hulic Reit

and could harm unitholder interests.

・Hulic Chofu

Appraisal value 3,430 million yen (Note 1)


Date of valuation February 1, 2021

(Millions of yen)






equally



(1) Operating revenue 185

Potential gross income 188

Revenue for rented rooms, etc., based on the terms of the

current lease agreement, and taking into account the terms of

the lease agreement and the tenants' ability to pay the rent,

among other factors, is noted here.

Losses from vacancy, etc. 3

Estimated by comprehensively considering the content of the

lease agreement, etc., the individual characteristics of the site

of the real estate in question, etc., and the lessee's attributes,

etc. for each application. (2) Operating expenses 34


fee/PM fee (Note 3) 5

Estimated taking into account the individual characteristics of

the target real estate, in reference to past results, expense

levels for similar real estate, etc.

Utility expenses 13 Estimated based on past results, after taking into account to

the occupancy rate for rental units, etc.

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Repair expenses 1

Estimated based on past results, and taking into account

expense levels for similar real estate, and average annual

repair and renewal expenses in engineering reports.


expenses, etc. 0

The figure noted here is the annual average amount estimated

based on an evaluation of the assumed turnover period for

lessees.

Taxes and public dues 15 Estimated based on materials related to taxes and public dues

and burden adjustment measures, etc.

Insurance premium 1 Estimated based on the premium rate for similar real estate,

etc. Other expenses ―


(NOI: (1) - (2)) 151

(4) Profit from security

deposits 1

Estimated based on evaluation of lease deposit and

investment return





Net cash flow

(NCF: (3) + (4) - (5)) 150

Cap rate 4.3%

Estimated by using the yields for real estate deemed to have

the lowest investment risk as the standard and adjusting the

spread appropriate for the property to be examined reflecting

site conditions, building conditions, use, conditions related to

business feasibility, and other factors, as well as

comprehensively taking into account future uncertainty and

investment yields for similar real estate properties, etc.


method 3,380

Discount rate 4.1%







factors including future trends in investment yields, risks

posed by the property in question as an investment, general

forecasts on economic growth in the future, and trends in real

estate prices and rents


(Note 2) 3,240

Ratio of land 72.1%

Ratio of building 27.9%


appraisal value

None

Notes:

1. Appraisal value is based on income method that reflects the profitability and investment return of the Property. In addition

to the unique characteristics of a home for the aged (inclusion of system correction risks and other business risks, difficulty

of changing use based on the low level of general usability of the building and social needs, the reliance of rental income

stability and continuity on the operator, and restrictions on market participants and the relative lack of fluidity), appraisal

agencies appraise the real estate by taking into consideration the appropriateness of rent levels in light of the income and

expenditures of the individual property, the operating capabilities of the lessee (operator), details of the lease agreement, and

other factors.

2. Appraisal values are rounded to the nearest million yen and are not to be considered either the revenue and expenses

forecast by Hulic Reit or Hulic REIT Management

3. The maintenance and management fee and PM fee stated above are combined, because individual disclosure of the

maintenance and management fee and PM fee amount levels may affect the other transactions of each contractor with respect

to building management and PM services, which could pose an obstacle to efficient performance of services by Hulic Reit

and could harm unitholder interests.

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(B) Assets planned for transfer

・Shinagawa Season Terrace

Appraisal value 6,225 million yen (Note 1) (Note 2)


Date of valuation August 31, 2020

(Millions of yen)






equally



(1) Operating revenue Undisclosed (Note 4) Potential gross income Undisclosed (Note 4) Losses from vacancy, etc. Undisclosed (Note 4) (2) Operating expenses Undisclosed (Note 4)


fee/PM fee Undisclosed (Note 4)

Utility expenses Undisclosed (Note 4) Repair expenses Undisclosed (Note 4)


expenses, etc. Undisclosed (Note 4)

Taxes and public dues Undisclosed (Note 4) Insurance premium Undisclosed (Note 4) Other expenses Undisclosed (Note 4)


(NOI: (1) - (2)) 871

(4) Investment profit and loss

from security deposits 16

Investment yields on the security deposits and guarantees

provided to the land leasehold setter are posted as investment

profit and loss after each is assessed.





Net cash flow

(NCF: (3) + (4) - (5)) 877

Cap rate 3.5%

Estimated by adjusting the spread appropriate for the

individual characteristics of the target real estate to the yield

that is standard for each area, as well as taking into

consideration the investment yields based on J-REIT

examples that have been released and investment yields of

similar real estate, etc.


method 24,600

Discount rate 3.2%







factors including general forecasts on economic growth in the

future and trends in real estate prices and rents


(Note 3) 22,100

Ratio of leasehold interest 66.8%

Ratio of building 33.2%

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appraisal value

None

Notes:

1. Appraisal value based on income method that reflects the profitability and investment return of the Property is used.

2. An amount equivalent to the quasi-co-ownership interest transfered by Hulic Reit (25.0%) .

3. The appraisal values for the unit ownership rights for the building and its site are rounded to the nearest million yen (of

which the portion identified as attributable to Hulic Reit is equivalent to 25% of the quasi-co-ownership rights). These

figures are not the revenue and expenses projected by Hulic Reit and Hulic REIT Management.The appraisal takes into

account results figures for which approval to disclose could not be obtained from the end tenants and other relevant

parties and disclosure of such information would harm the relationship of trust with end tenants and other relevant parties

and may make long-term continuation of the lease agreement difficult, and therefore, the information is not disclosed.

4. This appraisal takes into account to the actual values whose disclosure was not authorized by the end-tenants and

other relevant parties. This data is not disclosed as doing so could damage the trust established with the end-

tenants and other relevant parties, making it difficult to maintain lease agreements, etc. over the long term.

9. Overview of Building Inspection Report

Property Name Inspection company Inspection

performed on

Cost of urgent / short-term repairs

(Millions of yen)

(Note 1)

Cost of long-term repairs

(Millions of yen)

(Note 2)

Hulic Ueno

Building

(Note 3)

Tokio Marine & Nichido

Risk Consulting Co., Ltd. March 2021 －

(Bank branch building) 9

(Parking lot) 0

Hulic Chofu Tokio Marine & Nichido

Risk Consulting Co., Ltd. March 2021 － 4

Notes:

1. “Cost of urgent / short-term repair” includes the expense of updating and repair work and urgent repairs generally required

within one year as shown on the Building Inspection Report.

2. “Cost of long-term repairs” includes the average annual amount rounded to the nearest million yen for the expense appearing

on the Building Inspection Report as updating and repair work forecast over the next 12-year period.

3. The figures equivalent to quasi-co-ownership interest acquired by Hulic Reit are stated for “cost of urgent/short-term repairs”

and “cost of long-term repairs.”

* Hulic Reit’s website: https://www.hulic-reit.co.jp/en/index.html

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Attachments

Reference Attachment 1 Map and Photo of the Property

Reference Attachment 2 Portfolio List after Acquisition and Transfer of the Property

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Reference Attachment 1 Map and Photo of the Property

・ Hulic Ueno Building

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・ Hulic Chofu

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Reference Attachment 2 Portfolio List after Acquisition and Transfer of the Property

Category Property name Location

(Anticipated)

Acquisition price

(Millions of yen)

(Note 1)

Investment

ratio

(%)

(Note 2)

(Anticipated)

Acquisition date

(Note 3)

Toky

o C

om

mer

cial

Pro

per

ties

Off

ice

pro

per

ties

Hulic Kamiyacho Building Minato-ku, Tokyo 55,250 15.8%

February 7, 2014

March 15, 2016

October 16, 2018

Hulic Kudan Building (Land) Chiyoda-ku, Tokyo 11,100 3.2% February 7, 2014

Toranomon First Garden Minato-ku, Tokyo 8,623

(Note 4) 2.5% February 7, 2014

Rapiros Roppongi Minato-ku, Tokyo 6,210

(Note 4) 1.8%

February 7, 2014

September 16, 2016

Hulic Takadanobaba Building Toshima-ku, Tokyo 3,900 1.1% February 7, 2014

Hulic Kanda Building Chiyoda-ku, Tokyo 3,780 1.1% February 7, 2014

Hulic Kandabashi Building Chiyoda-ku, Tokyo 2,500 0.7% February 7, 2014

Hulic Kakigaracho Building Chuo-ku, Tokyo 2,210 0.6% February 7, 2014

Ochanomizu Sola City Chiyoda-ku, Tokyo 38,149

(Note 4) 10.9%

November 7, 2014

October 4, 2016

Hulic Higashi Ueno 1 Chome

Building Taito-ku, Tokyo 2,678 0.8%

October 16, 2014

June 29, 2018

Tokyo Nishi Ikebukuro Building Toshima-ku, Tokyo 1,580

(Note 4) 0.5% March 31, 2015

Hulic Toranomon Building Minato-ku, Tokyo 18,310 5.2% December 25, 2015

September 1, 2016

Hulic Shibuya 1 Chome Building Shibuya-ku, Tokyo 5,100 1.5% March 31, 2017

Hulic Higashi Nihombashi Building Chuo-ku, Tokyo 3,480 1.0% March 31, 2017

Hulic Jimbocho Building Chiyoda-ku, Tokyo 1,460 0.4% April 28, 2017

Hulic Ginza 7 Chome Building Chuo-ku, Tokyo 21,080

(Note 4) 6.0%

March 29, 2018

June 28, 2019 September 27, 2019

Hulic Gotanda Yamate-dori Building Shinagawa-ku,

Tokyo 3,450 1.0% October 1, 2018

Bancho House Chiyoda-ku, Tokyo 2,750 0.8% November 1, 2018

Ebisu Minami Building Shibuya-ku, Tokyo 2,420 0.7% December 27, 2018

Hulic Iidabashi Building Chiyoda-ku, Tokyo 1,450 0.4% June 28, 2019

Hulic Asakusabashi Building Taito-ku, Tokyo 4,750

(Note 4) 1.4% December 20, 2019

Hulic Ebisu Building Shibuya-ku, Tokyo 1,275 0.4% December 20, 2019

Hulic Ryogoku Building Sumida-ku, Tokyo 5,610

(Note 4) 1.6% March 26, 2020

Hulic Asakusabashi Edodori Taito-ku, Tokyo 5,420

(Note 4) 1.5% March 26, 2020

Hulic Nakano Building Nakano-ku, Tokyo 3,200

(Note 4) 0.9% October 16, 2020

Hulic Ueno Building Taito-ku, Tokyo 4,100

(Note 4) 1.2% March 31, 2021

Subtotal - 219,835 62.8% -

Ret

ail

pro

per

ties

Oimachi Redevelopment Building (#2) Shinagawa-ku,

Tokyo 9,456 2.7% February 7, 2014

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Oimachi Redevelopment Building (#1) Shinagawa-ku, Tokyo

6,166 (Note 4)

1.8% February 7, 2014

Dining Square Akihabara Building Chiyoda-ku, Tokyo 3,200 0.9% February 7, 2014

Hulic Jingu-mae Building Shibuya-ku, Tokyo 2,660 0.8% February 7, 2014

Hulic Shinjuku 3 Chome Building Shinjuku-ku, Tokyo 6,690 1.9% October 16, 2014

February 13, 2020

Yokohama Yamashitacho Building Yokohama-shi,

Kanagawa 4,850 1.4% October 16, 2014

Hulic Todoroki Building Setagaya-ku, Tokyo 1,200 0.3% December 27, 2016

HULIC &New SHIBUYA Shibuya-ku, Tokyo 3,150

(Note 4) 0.9% June 30, 2017

HULIC &New SHINBASHI Minato-ku, Tokyo 3,100 0.9% November 1, 2017

Hulic Shimura-sakaue Itabashi-ku, Tokyo 7,556 2.2% June 29, 2018

Hulic Mejiro Toshima-ku, Tokyo 5,670 1.6% March 26,2020

Subtotal - 53,698 15.3% -

Intermediate total - 273,533 78.2%

Nex

t-G

ener

atio

n A

sset

s P

lus

Pri

vat

e nu

rsin

g h

om

es

Aria Matsubara Setagaya-ku, Tokyo 3,244 0.9% February 7, 2014

Trust Garden Youganomori Setagaya-ku, Tokyo 5,390 1.5% February 7, 2014

Trust Garden Sakurashinmachi Setagaya-ku, Tokyo 2,850 0.8% February 7, 2014

Trust Garden Suginami Miyamae Suginami-ku, Tokyo 2,760 0.8% February 7, 2014

Trust Garden Tokiwamatsu Shibuya-ku, Tokyo 3,030 0.9% September 1, 2016

Sompo Care La vie Re Kita-kamakura Kamakura-shi,

Kanagawa 1,780 0.5% June 30, 2017

Charm Suite Shinjukutoyama Shinjuku-ku, Tokyo 3,323 0.9% September 27, 2019

Charm Suite Shakujiikoen Nerima-ku, Tokyo 3,200 0.9% September 12, 2019

Hulic Chofu Chofu-shi, Tokyo 3,340 1.0% March 31, 2021

Subtotal - 28,917 8.3% -

Net

work

cen

ters

Ikebukuro Network Center Toshima-ku, Tokyo 4,570 1.3% February 7, 2014

Tabata Network Center Kita-ku, Tokyo 1,355 0.4% February 7, 2014

Hiroshima Network Center Hiroshima-shi, Hiroshima

1,080 0.3% February 7, 2014

Atsuta Network Center Nagoya-shi, Aichi 1,015 0.3% February 7, 2014

Nagano Network Center Nagano-shi, Nagano 305 0.1% February 7, 2014

Chiba Network Center Inzai-shi, Chiba 7,060 2.0% December 16, 2014

Sapporo Network Center Sapporo-shi,

Hokkaido 2,510 0.7% December 16, 2014

Keihanna Network Center Kizukawa-shi,

Kyoto 1,250 0.4% October 16, 2014

Subtotal - 19,145 5.5% -

Ho

tels

Sotetsu Fresa Inn Ginza 7 Chome Chuo-ku, Tokyo 11,520 3.3% September 16, 2016

November 1, 2017

Sotetsu Fresa Inn Tokyo-Roppongi Minato-ku, Tokyo 5,000

(Note 4) 1.4% November 1, 2017

Hulic Tsukiji 3 Chome Building Chuo-ku, Tokyo 6,972 2.0% March 26, 2020

Subtotal - 23,492 6.7% -

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Oth

ers Hulic Hachioji Building

Hachioji-shi, Tokyo

4,900 (Note4)

1.4% October 16, 2020

Subtotal - 4,900 1.4% -

Intermediate total - 76,454 21.8%

Total of the portfolio - 349,987 100.0％ -

Notes:

1. “(Anticipated) Acquisition price” is the purchase price noted in the purchase and sale agreement for each asset held

and the Property (total value in the event that the acquisition takes place over multiple times), rounded to the nearest

million yen. The acquisition price does not include consumption or local taxes or the costs and expenses related to the

acquisition.

2. “Investment ratio” represents the percentage of the (anticipated) acquisition price for each asset held and the Property

(total value in the event that the acquisition takes place over multiple times) to the total (anticipated) acquisition price,

rounded to the first decimal place.

3. “(Anticipated) Acquisition date” is the anticipated date of acquisition stated in the relevant purchase and sale

agreement for each asset held and the Property.

4. The figure is based on the ratio of sectional ownership interest or quasi-co-ownership interest owned by Hulic Reit in

the properties.

Notice concerning the Acquisition and Transfer of Property

Documents

Transcript of Notice concerning the Acquisition and Transfer of Property