ITOCHU Advance Logistics Investment : (Delayed)Summary of Financial Results For the Seventh Fiscal Period

March 17, 2022

ITOCHU Advance Logistics Investment Corporation

Summary of Financial Results (Unaudited)

For the Seventh Fiscal Period Ended January 31, 2022

(For the Reporting Period from August 1, 2021 to January 31, 2022)

(Translated from the Japanese original)

Corporate Information

Code: 3493 Listing: Tokyo Stock Exchange (URL:https://www.ial-reit.com/en/) Representative: Junichi Shoji, Executive Director

Asset management company: ITOCHU REIT Management Co., Ltd. Representative: Junichi Shoji, Representative Director, President & CEO Inquiries: Hiromu Shinoda, GM, Finance & Planning

Tel: [phone]

Scheduled date to file securities report (Japanese only): April 26, 2022 Scheduled date to commence payment of distributions: April 12, 2022 Preparation of supplementary material on financial results: Yes

Financial report presentation meeting: Yes (for institutional investors and analysts)

1. Financial Results and Forecasts

(Amounts rounded to the nearest million yen)

1. Financial Results for the Fiscal Period Ended January 2022 (from August 1, 2021 to January 31, 2022)

(1) Operating conditions

(Percentages represent changes from the previous period (Note1))

Operating revenues	Operating income	Ordinary income	Net income
Fiscal period ended January 2022 Fiscal period ended July 2021	(Millions of yen) 3,178 3,059	% 3.9 17.4	(Millions of yen) 1,550 1,489	% 4.1 12.6	(Millions of yen) 1,414 1,353	% 4.5 14.2	(Millions of yen) 1,413 1,352	% 4.5 14.2

Net income per unit (Note2)	Return on unitholders' equity	Ratio of ordinary income to total assets	Ratio of ordinary income to operating revenues
Fiscal period ended January 2022 Fiscal period ended July 2021	(Yen) 2,355 2,254	% 2.2 2.1	% 1.2 1.2	% 44.5 44.2

(Note1) Percentage changes from the previous period are rounded to the first decimal place. The same shall apply hereinafter.

(Note2) Net income per unit is calculated by dividing net income by the weighted average number of investment units based on the number of days during the period.

(2) Distributions

Distributions per unit (excluding surplus cash distribution (SCD))	Total distributions (excluding SCD)	SCD per unit	Total SCD	Distributions per unit (including SCD)	Payout ratio	Distributions-to-net assets ratio
Fiscal period ended January 2022 Fiscal period ended July 2021	(Yen) 2,356 2,254	(Millions of yen) 1,413 1,352	(Yen) 399 238	(Millions of yen) 239 142	(Yen) 2,755 2,492	% 100.0 100.0	% 2.2 2.1

(Note 1) Payout ratio = Distributions per unit (excluding SCD) ÷ Net income per unit × 100 (Note 2) The ratio of distributions to net assets is calculated using the following formula:

Distributions per unit (excluding SCD) ÷ [(Net assets per unit at beginning of period + Net assets per unit at end of period)

÷ 2] × 100

(Note 3) The entire amount of SCD for the fiscal period ended July 2021 and January 2022 is considered to be a refund of investment, which, for tax purposes, falls under a category of distribution as a reduction in unitholders' capital.

(Note 4) The ratio of (i) reduced retained earnings to (ii) net asset value as of the end of the immediately preceding fiscal period, as a result of SCD (a refund of investment which, for tax purposes, falls under the category of distribution as a reduction in the unitholders' capital), is 0.003 for the fiscal period ended July 2021 and 0.004 for the fiscal period ended January 2022, respectively. The ratio was calculated in accordance with Article 23, Paragraph 1, Item 4 of the Order for Enforcement of the Corporation Tax Act (Cabinet Order No. 97 of 1965, as amended).

(3) Financial position

Total assets	Net assets	Unitholders' equity ratio	Net assets per unit
Fiscal period ended January 2022 Fiscal period ended July 2021	(Millions of yen) 115,642 115,747	(Millions of yen) 65,173 65,255	% 56.4 56.4	(Yen) 108,600 108,736

(4) Cash flows

Cash flows from operating activities	Cash flows from investing activities	Cash flows from financing activities	Cash and cash equivalents at end of period
Fiscal period ended January 2022 Fiscal period ending July 2021	(Millions of yen) 2,881 2,459	(Millions of yen) (25) (13,385)	(Millions of yen) (1,928) 10,843	(Millions of yen) 5,468 4,541

Cash and cash equivalents

2. Forecast of Financial Results for the Fiscal Period Ending July 31, 2022 (February 1, 2022 to July 31, 2022) and the Fiscal Period

Ending February 28, 2023 (August 1, 2022 to February 28, 2023).

(Percentages represent changes from the previous period)

Operating revenues	Operating income	Ordinary income	Net income	Distributions per unit (excluding SCD)	SCD per unit	Distributions per unit (including SCD)
Fiscal period ending July 2022 Fiscal period ending February 2023	(Millions of yen) 3,173 3,705	% -0.1 -	(Millions of yen) 1,511 1,848	% -2.5 -	(Millions of yen) 1,375 1,665	% -2.8 -	(Millions of yen) 1,374 1,664	% -2.8 -	(Yen) 2,290 2,774	(Yen) 399 465	(Yen) 2,689 3,239

(Reference) Expected net income per unit (Forecast net income ÷ Expected number of investment units at end of period) is 2,290 yen for the fiscal period ending July 2022 and 2,774 yen for the fiscal period ending February 2023.

(Note1) As described in the "Notice Concerning Amendments to the Articles of Incorporation and Election of Directors" released on January 27, 2022, the

Investment Corporation will change its fiscal period from January/July to February/August every year, and will also change its operating period (however, the operating period for the 9th fiscal period will be from August 1, 2022 to August 1, 2023). The Investment Corporation plans to submit a proposal to amend its articles of incorporation (the "Partial Amendment to the Articles of Incorporation") to the fourth general meeting of unitholders of the Investment Corporation scheduled to be held on April 27, 2022. If the Proposed Partial Amendment to the Articles of Incorporation is approved, the fiscal period will be changed from the fiscal period ending February 2023, and the accounting period will be seven months in that period.(Note2) Since the 9th fiscal period is assumed to be a seven-month period from August 1, 2022 to February 28, 2023, the percentage change from the previous fiscal period for the fiscal period ending February 28, 2023 is not shown.

(Note 2) The percentage change from the previous fiscal period for the fiscal period ending February 28, 2023 is not shown since the 9th fiscal period is assumed to be the seven-month period from August 1, 2022 to February 28, 2023.

3. Others

(1) Changes in accounting policies, changes in accounting estimates, and retrospective statements

• (a) Changes in accounting policies associated with revision of accounting standards, etc.: Yes*

• (b) Changes in accounting policies associated with other than (a): None

• (c) Changes in accounting estimates: None

• (d) Restatements: None

*For details, see "Notes on Changes in Accounting Policies" on page 10.

(2) Total number of investment units issued and outstanding

• (a) Total number of investment units issued and outstanding at the end of the fiscal period (including treasury investment units)

• (b) Total number of treasury investment units at the end of the fiscal period

Fiscal period ended January 2022	600,127	Fiscal period ended July 2021	600,127
Fiscal period ended January 2022	0	Fiscal period ended July 2021	0

Summaries of Financial Results are not audited by a certified public accountant or other independent auditor.

Other special instructions

(Note on forward-looking statements)

Forward-looking statements presented in this document are based on information currently available to ITOCHU Advance Logistics Investment Corporation ("IAL") and on certain assumptions deemed by management to be reasonable. As such, actual operating and other results may differ materially from these forecasts as a consequence of various factors. The above forecast does not guarantee the amount of the distribution.

Assumptions Underlying the Forecast for the Fiscal Periods Ending July 2021 and January 2022

Item	Assumption
Calculation period	・ The Eighth fiscal period ending July 2022 (February 1, 2022 to July 31, 2022) (181 days) ・ The Nineth fiscal period ending February 2023 (August 1, 2022 to February 28, 2023) (212 days) It is assumed that the Partial Amendment to the Articles of Incorporation will be approved at the general meeting of unitholders scheduled to be held on April 27, 2022, and the fiscal period will be changed from the fiscal period ending February 2023.
Investment assets	・The trust beneficiary interests in real estate owned by IAL as of the end of January 2022 (12 properties in total) ("Currently Owned Assets") is assumed that there will be no acquisition of new assets or disposal of owned assets by the end of the fiscal period ending February 28, 2023. ・Despite the assumption above, however, there may be changes in assets under management due to acquisition of new properties or disposition of existing properties.
Operating revenues	・ Forecasted leasing business revenues for the Currently Owned Assets were calculated taking into consideration the content of lease agreements which have been executed and are effective as of January 31, 2022, or are scheduled to take effect by, February 2023, as well as tenant and market trends, among other things. ・It is assumed that no rent defaults or unpaid leases on the part of tenants will occur during the period of these forecasts. ・These forecasts are made based on the assumptions that there will be no profit or loss from the sale of real estate or other assets.
Operating expenses	・Main items included under operating expenses are as follows: (Millions of yen)Fiscal period endingFiscal period ending July 2022 February 2023 Expenses related to rent business Facility management expenses 31 37 Property management contract expenses 15 18 Utility expenses 26 32 Repair expenses 11 9 Taxes and public dues 305 306 Depreciation costs 798 931 General and administrative expenses Asset management fees Sponsor support agreement expenses 380 22 428 22 ・With the exception of depreciation costs, the forecast of real estate leasing business expenses, which are to be IAL's main operating expenses, are calculated based on historical data of the Currently Owned Assets and factors that may cause expenses to fluctuate. ・Forecast repair expenses for buildings are estimated based on medium- to long-term repair plans developed by the asset management company, ITOCHU REIT Management Co., Ltd.("IRM"). Repair expenses could suddenly increase, however, due to property damage caused by factors that are difficult to predict. Furthermore, repair expenses generally differ in amount over a fiscal year and are not incurred at regular intervals. Due to these and other factors, the forecast amounts of repair expenses may differ substantially from results. ・Forecast depreciation costs are calculated using the straight-line method, and include ancillary and other expenses. ・It is assumed that the Partial Amendment to the Articles of Incorporation will be approved at the general meeting of unitholders scheduled to be held on April 27, 2022, and that the asset management fees will be partially amended from the fiscal period ending February 2023 based on the amended Articles of Incorporation.
Non-operating expenses	・The forecast of non-operating expenses is ¥135 million for the fiscal period ending July 2022, and ¥182 million for the fiscal period ending February 2023. ・The forecast of interest expenses and other borrowing-related expenses is ¥132 million for the fiscal period ending July 2022 and ¥178 million for the fiscal period ending February 2023.
Interest-bearing debt	・It is assumed that total interest-bearing debt will amount to ¥47,280 million at the end of the fiscal period ending July 2022, and ¥47,240 million at the end of the fiscal period ending February 2023. ・The loan-to-value (LTV) ratio is expected to be around 41.0% at the end of the fiscal period ending July 2022, and 41.0% at the end of the fiscal period ending February 2023. The LTV ratio is calculated by the following formula and is rounded to the first decimal place: LTV = total interest-bearing debt ÷ total assets × 100

by IAL as of the end of January 2022 (12 properties in total) ("Currently Owned Assets") is assumed that there will be no acquisition of new assets or disposal of

assumption above, however, there may be changes in assets under management due to

taking into consideration the content of lease agreements which have been executed and are effective as of January 31, 2022, or are scheduled to take effect by, February 2023, as well as tenant and market trends, among other

rent defaults or unpaid leases on the part of tenants will occur during the period of these

These forecasts are made based on the assumptions that there will be no profit or loss from the sale of real

With the exception of depreciation costs, the forecast of real estate leasing business expenses, which are to

term repair plans developed . Repair expenses could amage caused by factors that are difficult to predict.

Furthermore, repair expenses generally differ in amount over a fiscal year and are not incurred at regular substantially

line method, and include ancillary and other

It is assumed that the Partial Amendment to the Articles of Incorporation will be approved at the general ting of unitholders scheduled to be held on April 27, 2022, and that the asset management fees will be partially amended from the fiscal period ending February 2023 based on the amended Articles of

47,280 million at the end of the fiscal period

value (LTV) ratio is expected to be around 41.0% at the end of the fiscal period ending July tio is calculated by the

Item	Assumption
Total number of investment units outstanding	・It is assumed that the total number of investment units issued and outstanding as of the date hereof (i.e., 600,127 units) remains the same until the end of the period ending February 2023. ・Distributions per unit (excluding SCD) and SCD per unit were calculated based on the expected total number of investment units issued and outstanding at the end of the fiscal period ending July 2022 and at the end of the fiscal period ending February 2023 (i.e., 600,127 units).
Distributions per unit (excluding SCD)	・The forecast distributions per unit (excluding SCD) was calculated according to IAL's distribution policy described in its Articles of Incorporation, assuming that the entire amount of profits will be distributed. ・Despite the above, actual distributions per unit (excluding SCD) may differ for a variety of reasons, such as changes in assets under management, fluctuations in leasing business revenues due to tenant movements or other factors, or unforeseen events requiring repairs and maintenance.
SCD per unit	・SCD per unit was calculated based on the policies stipulated in IAL's Articles of Incorporation and the asset management guidelines contained in the internal rules of IRM. Total SCD are estimated at ¥239 million in the fiscal period ending July 2022, and ¥279 million in the fiscal period ending February 2023. ・It is assumed that general economic conditions, trends in the real estate market in Japan, and IAL's financial position will not deteriorate substantially during the periods of these forecasts. ・From the perspective of ensuring the long-term maintenance of assets held and financial stability, IAL plans, in principle, to pay SCD continuously every fiscal period at an amount equivalent to 30% of depreciation expenses for the applicable fiscal period, taking into account past results related to capital expenditures, etc. and future prospects based on engineering reports, etc. ・In addition to the payment of SCD each successive fiscal period, additional SCD may be paid in order to even out the amount of distributions per unit if such distributions are expected to be temporarily reduced at a significant rate due to funds procurement through the issuance of new investment units or other factors. ・IAL may decide against distributing cash distributions in excess of realizable amounts if it deems such distributions to be unwise in light of economic conditions, trends in Japan's real estate and leasing markets, or the status of its property portfolio and financial position. ・If appraised LTV (Note) is expected to exceed 60% after cash distribution, IAL does not distribute SCD in order to ensure stable finances. (Note) Appraised LTV = A/B × 100 A = Total interest-bearing debt as of the closing date of the applicable fiscal period B = Total assets on the balance sheet as of the closing date of the applicable fiscal period - amount of book value of owned real estate after depreciation, as of the closing date of the applicable fiscal period + appraised value of owned real estate as of the closing date of the applicable fiscal period
Other	・Financial calculations and operating forecasts are based on the assumption that there will be no changes in legislation, taxation, accounting standards, regulations imposed on publicly listed companies by the Tokyo Stock Exchange, or rules or requirements imposed by the Investment Trusts Association, Japan, in any way that would impact the aforementioned forecasts. ・Financial calculations and operating forecasts are also based on the assumption that there will be no substantial changes in general economic and real estate market conditions in Japan. ・It is assumed that the COVID-19 pandemic will not adversely affect the performance of IAL's property portfolio.

as changes in assets under management, fluctuations in leasing business revenues due to tenant movements

even out the amount of distributions per unit if such distributions are expected to be temporarily reduced at

amount of book

2. Consolidated Financial Statements
(1) Consolidated Balance Sheet
(Thousands of yen)
6th fiscal period	7th fiscal period
(as of July 31, 2021)	(as of January 31, 2022)
Assets
Current assets
Cash and deposits	2,056,841	2,909,181
Cash and deposits in trust	4,158,986	4,233,581
Operating accounts receivable	47,114	44,336
Consumption taxes receivable	199,436	-
Prepaid expenses	62,749	60,724
Total current assets	6,525,128	7,247,824
Non-current assets
Property, plant and equipment
Buildings in trust	60,371,130	60,372,596
Accumulated depreciation	(2,990,335)	(3,697,510)
Buildings in trust, net	57,380,795	56,675,086
Structures in trust	2,214,959	2,214,959
Accumulated depreciation	(247,992)	(308,197)
Structures in trust, net	1,966,967	1,906,761
Machinery and equipment in trust	1,666,312	1,666,312
Accumulated depreciation	(139,035)	(170,781)
Machinery and equipment in trust, net	1,527,277	1,495,531
Tools, furniture and fixtures in trust	3,054	3,054
Accumulated depreciation	(738)	(1,010)
Tools, furniture and fixtures in trust, net	2,315	2,043
Land in trust	48,131,041	48,131,041
Total property, plant and equipment	109,008,398	108,210,465
Intangible assets
Software	2,547	1,990
Total intangible assets	2,547	1,990
Investments and other assets
Leasehold and guarantee deposits	10,000	10,000
Long-term prepaid expenses	192,572	164,505
Deferred tax assets	17	7
Total investments and other assets	202,590	174,513
Total non-current assets	109,213,536	108,386,968
Deferred assets
Investment corporation bond issuance expenses	8,509	7,232
Total deferred assets	8,509	7,232
Total assets	115,747,173	115,642,026