SANKEI REAL ESTATE : (Delayed)4th Fiscal Period (Ended February 2021) Financial Results Briefing Materials

April 22, 2021 at 09:36 pm

April 19, 2021

4th Fiscal Period (Ended February 2021) Financial Results Briefing Materials

Asset

Management

Company

SANKEI REAL ESTATE Inc.

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SANKEI REAL ESTATE Inc.

Table of Contents

Executive Summary		… P3
1. Financial Results and
Management Highlights		… P4
2. Internal Growth Results and Strategy	… P14
2-1	Internal Growth Results	… P15
2-2	Internal Growth Strategy	… P19
3. External Growth Results and Strategy	… P21
3-1	External Growth Results	… P22
3-2	External Growth Strategy	… P23
4. Financial Strategy		… P28
5. ESG Initiatives		… P31
Appendix		… P37

Disclaimer

This document is intended for the purpose of providing information on SANKEI REAL ESTATE Inc. (hereinafter, "SANKEI REAL ESTATE"), and is not intended for the purpose of soliciting investment in or recommending the trading of specific products. Please consult your securities company for any purchase of SANKEI REAL ESTATE investment units. When making any investment, investors do so at their sole discretion and risk. The information provided in this document is an analysis or a judgment made by Sankei Building Asset Management Co., Ltd. (hereinafter, "Sankei Building Asset Management") based on information currently available to Sankei Building Asset Management, and Sankei Building Asset Management does not guarantee and is not liable whatsoever for the accuracy, reliability, integrity, etc. thereof. In addition, the content may be changed or abolished without prior notice. The content of this document contains earnings forecasts and other forward-looking statements. These forward-looking statements are not a guarantee of future business performance or financial content of SANKEI REAL ESTATE. All rights to any part of this document belong to Sankei Building Asset Management, and no part of this document shall be used, cited, reproduced, altered, disassembled, transmitted, etc. by any means, electronic or mechanical, for any purpose without permission. This document is not a disclosure document based on the Financial Instruments and Exchange Act. Please contact below if you have any inquiries concerning this document.

Sankei Building Asset Management Co., Ltd.

Finance & IR Department

Phone: +81-3-5542-1316

SANKEI REAL ESTATE Inc.

Executive Summary

Financial Results and Management Highlights

In the 4th FP, as both external growth and internal growth proved effective, revenue and profit increased from both the forecast*1 and the previous fiscal period
DPU*2 for the 4th FP was 2,849 yen, +6.5% (+173 yen) from the forecast or +12.5% (+317 yen) from the previous fiscal period
With the acquisition of "S-GATEAKASAKA," a relatively new property in central Tokyo, continued to achieve external growth steadily

(Impact on DPU*3 for 4th FP: +128 yen; +13 yen from forecast)

There was almost no impact of the COVID-19 pandemic following the previous period (The occurrence of assumed GV*4 is also almost zero)

Future Growth Strategies

Investment unit prices recovering, seeking external growth opportunities (abundant pipeline: approx. 50 to 100 billion yen)
Target competitive properties exceeding portfolio NOI yields in Greater Tokyo and ordinance-designated cities
For office buildings, place emphasis on location and specifications; For sub assets, focus on retail and logistics facilities
Continue to pursue internal growth, placing weight on focused properties for the time being

*1 Forecast refers to the forecast for the 4th FP at the time of the announcement of the financial results for the previous fiscal period (October 2020).

*2 DPU refers to distribution per unit.

*3 The 4th FP net profit base value (minus other operating expenses and non-operating income (loss) required to acquire actual operating income (loss) from leasing) is divided by the number of investment units issued and outstanding (356,800 units).

*4 Assumed GV (General Vacancy) is the amount equivalent to 0.5% of the rental and CAM revenue (-10,079 thousand yen in 4th FP), budgeted as a certain risk of decrease in revenue caused by the risk of the COVID-19 pandemic.

*5 Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

1. Financial Results and Management Highlights

SANKEI REAL ESTATE Inc.

Financial Highlights

- As both external growth and internal growth proved effective,

revenue and profit increased from both the forecast and the previous fiscal period -

DPU for the 4th FP was 2,849 yen, +6.5% (+173 yen) from the forecast or +12.5% (+317 yen) from the previous fiscal period
There was almost no impact of the COVID-19 pandemic. Reducing repair expenses also contributed to increased revenue and profit
Financial Summary for 4th FP (Ended February 2021)

	Result		Comparison with			Comparison with
		forecast				previous fiscal period

Operating revenue	2,147	million yen	%	+12	million yen		%	+142	million yen
		+0.6			+7.1
Operating profit	1,118	million yen	%	+67	million yen	%	+122	million yen
		+6.4			+12.3
Net profit	1,016	million yen	%	+61	million yen	%	+113	million yen
		+6.5			+12.5
DPU (Distribution per unit)		2,849	yen	%		+173	yen	%		+317 yen
			+6.5			+12.5

■ Change in DPU for 4th FP (Ended February 2021)	(Unit: yen per unit)

2,900 yen
				2,849 yen

2,800 yen	2,676 yen	+12.5%

2,700 yen

2,600 yen

2,532 yen			+6.5%

2,500 yen			+5.7%



2,400 yen

	3rd FP		4th FP		4th FP
	Result		Forecast		Result
			(as of October 2020)

There was almost no impact of the COVID-19 pandemic

・Office and store revenue → budgeted as assumed GV

Rental and CAM revenue x 0.5% = -10,079 thousand yen DPU -28yen

・Rental conference room balance → budgeting within individual property balance

DPU -8yen

			Comparison with	Comparison with
			previous fiscal
			forecast
Breakdown of DPU	Forecast	Result	period
Change	Change


Office revenue		0 yen		0 yen
	-28 yen		+28 yen
Store revenue	-0.2 yen	-0.2 yen


Rental conference	-8 yen	-7 yen	+1 yen	0.3 yen
room balance

Total DPU	-36 yen	-7 yen	+29 yen	+0.1 yen

* Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Financial Results Highlights

Summary of DPU for 4th FP (Ended February 2021) (Comparison with Previous Fiscal Period)

In the 4th FP, as both external growth and internal growth proved effective, DPU increased significantly from the previous fiscal period

Summary of DPU for 4th FP (Ended February 2021)

+399

Internal growth

Rent revision

External growth

AKASAKA

acquisition

(yen per unit)

Comparison with DPU for

previous fiscal period

+317 yen

(+12.5%)

Change in	Change in
expenses
other
related to
operating	Change in non-	Impact of the
leasing business
expenses
operating	COVID-19


Main breakdown		income (loss)	pandemic

Increase in outsourcing expenses -30

Change in rental revenue, etc.

	3rd FP	4th FP
	Result	Result
*1	The +209 yen for "External Growth AKASAKA Acquisition" on this page uses S-GATE AKASAKA's 4th FP leasing business revenue divided by the number of
	investment units issued and outstanding (356,800 units).
			6
*2	Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Financial Results Highlights (Comparison with Forecast) 4th Fiscal Period (Ended February 2021)

Revenue and profit increased (operating revenue: +0.6%; operating profit: +6.4%; net profit: +6.5%)

from the forecast					(Unit: million yen)


Accounting period	4th FP Forecasts (A)	4th FP Results (B)	Difference		Major Factors for the Difference
(as of October 2020)	(February 2021)	(B)-(A)

Operating revenue	2,135	2,147	12
	Rental and CAM revenue	2,015	2,015	10	・ Assumed GV not used as described below (+10)
			Assumed GV included	(10)	0	10
			therein

	Parking revenue	30	30	0

	Utilities reimbursement	94	93	(0)
	Other revenue	5	8	2	・ Cancellation fee: Tokyo Sankei (+2.5)

Operating expenses	1,084	1,029	(55)
	Expenses related to leasing	840	790	(50)
	business [Total]

		Outsourcing expenses	185	183	(2)	・ Decrease in CM fee due to decrease in repair expenses (-2.2)

		Utilities expenses	122	110	(11)	・ Breakdown: BREEZÉ TOWER (-4.3), Shinagawa (-2.9), Omori (-1.6), Hatchobori (-1.2), Hibiya (-0.6), AKASAKA (-0.5), Toyo
							(+0.6),	etc.
		Repair expenses	68	35	(32)	・ Non-implementation of work, reduction of construction costs: BREEZÉ TOWER (-16.9), Hibiya (-9.8), Shinagawa (-4.4)
		Property taxes	215	214	(0)
		Depreciation	228	227	(1)	・ Decrease in depreciation due to decrease in additional capital investment (-8.5) and delay in implementation
		Other expenses	19	17	(1)
	Operating income (loss) from	1,295	1,357	62
	leasing

	Total other operating expenses	243	239	(4)
		Asset management fee	184	186	2	・ Increase in fee due to increase in income from leasing
		Other expenses	59	52	(7)	・ Decrease due to unused reserve
Operating profit	1,051	1,118	67
Non-operating income	0	0	0
Non-operating expenses	95	101	5
Ordinary profit	955	1,017	61

Net profit	954	1,016	61
Distribution per unit (Unit: yen)	2,676 yen	2,849 yen	173 yen
NOI	1,523	1,585	61
* Figures are rounded down to the indicated digits, and ratios are rounded off.			7

SANKEI REAL ESTATE Inc.

Financial Results Highlights (Comparison with Previous Fiscal Period) 4th Fiscal Period (Ended February 2021)

Revenue and profit increased (operating revenue: +7.1%; operating profit: +12.3%; net profit: +12.5%) from the

previous fiscal period

(Unit: million yen)

Accounting period	3rd FP Results (A)	4th FP Results (B)	Difference	Major Factors for the Difference
(August 2020)	(February 2021)	(B)-(A)

Operating revenue	2,005	2,147	142
	Rental and CAM revenue	1,878	2,015	137	・ SG AKASAKA acquisition (+69) ・Upward rent revision: BREEZÉ TOWER (+37), Shinagawa (+21)
	・ SG NIHONBASHI-HONCHO phased rent increase (+12)	・Omori vacancy (-11)
	Parking revenue	29	30	1	・ SG AKASAKA acquisition (+1.2)
	Utilities reimbursement	90	93	2	・ SG AKASAKA acquisition (+4.0) ・BREEZÉ TOWER (-2.5)・Other (+0.9)
	Other revenue	6	8	1	・ Cancellation fee: Tokyo Sankei (+2.5), BREEZÉ TOWER (-0.5)

Operating expenses	1,009	1,029	20
	Expenses related to leasing	778	790	11
	business [Total]

		Outsourcing expenses	172	183	10	・ SG AKASAKA acquisition (+5.5)
		・ Increase in rent increase revision fee: Shinagawa (+6.1), BREEZÉ TOWER (-8), Other (+7)
		Utilities expenses	118	110	(7)	・ Decrease in 3rd FP results
		Repair expenses	35	35	0
		Property taxes	215	214	(0)
		Depreciation	219	227	7	・ SG AKASAKA acquisition (+6.4)
		Other expenses	17	17	0
	Operating income (loss) from	1,226	1,357	131
	leasing

	Total other operating expenses	230	239	9
		Asset management fee	183	186	3	・ Increase in fee due to increase in income from leasing
		Other expenses	46	52	6	・ Increase in expenses related to unitholders' meeting
Operating profit	996	1,118	122
Non-operating income	0	0	(0)

Non-operating expenses	92	101	8	・ Accrual of refinancing costs (+8)
Ordinary profit	904	1,017	113
Net profit	903	1,016	113
Distribution per unit (Unit: yen)	2,532 yen	2,849 yen	317 yen
NOI	1,446	1,585	138

* Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Management Highlights (Internal Growth)

- Continued to achieve steady internal growth even in the prolonged COVID-19pandemic -

Rent Revision Performance of Office Buildings for 4th FP (Based on Closing of Books)
Actual NOI yield and average rent increased, and occupancy rate almost full occupancy

(hereinafter, major properties)

				Shinagawa		S-GATE
BREEZÉ TOWER				NIHONBASHI-
	Seaside TS Tower
				HONCHO

DPU Result*1			DPU Result*1		DPU Result*1
						+31 yen
+114 yen			+47 yen



	Actual NOI yield			4.4% (+10bp from previous fiscal period)
	Office Buildings Average Rent	19,309 yen/tsubo (+4.5% from previous fiscal period)
	Period-end occupancy rate			99.9% (-0.1p from previous fiscal period)

Rent Revision Performance of Office Buildings for 4th FP

(Based on Conclusion of Contracts)

For lease agreements concluded between September 1, 2020, and February 28, 2021

BREEZÉ TOWER		S-GATE AKIHABARA		Hibiya Sankei Building
Rate of rent increase		Rate of rent increase	Rate of rent increase
compared with		compared with		compared with
before		before		before
Renewal with rent		Renewal with rent	Renewal with rent
revision/renewal		revision/renewal	revision/renewal
+24.1%	+15.8%	+10.0%
New replacement		New replacement	New replacement
-	-	-

Impact on DPU*2

+23 yen

Target area	2,769 tsubo
Percentage of rent increase	25.8%

Rate of rent increase compared with before

+10.2%

Amount of monthly rent increase

+1.4 million yen

*1	The difference between the operating income (loss) from leasing for the current fiscal period and the operating income (loss) from leasing for the previous fiscal period is divided by the number of
	investment units issued and outstanding (356,800).
*2	Calculated by converting the amount of increase in monthly rental and CAM revenue into that for the full period (6 months) and dividing it by the number of investment units issued and outstanding
	(356,800 units).
	9
*3	Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Management Highlights (External Growth) - Continued to achieve steady external growth -

With the expectation of potential redevelopments in the neighborhood, acquired "S-GATEAKASAKA," a relatively new property in central Tokyo*1

Impact of DPU for 4th FP＊2

＋128 yen

Sannoshita

Akasaka Biz Tower

akasaka Sacas

Akasaka

ACT Theater

Planned neighborhood

	Akasaka BLITZ		Redevelopment Area


				Akasaka 2 Police Box
			Kokusai Shinakasaka Bldg. East


TBS
		Kokusai Shinakasaka Bldg. West

				S-GATE AKASAKA
		KAJIMA CORPORATION KI Bldg.


					Overview
			Location	Minato-ku, Tokyo

			Acquisition price	4,200 million yen
			Appraisal value	4,266 million yen

			Appraisal NOI yield	3.3%
			Construction completion	July 2015

			Ceiling height	2,800 mm
			Floor load	500 kg/m²

*1	SANKEI REAL ESTATE has acquired 60% quasi co-ownership interest in real estate trust beneficiary rights.
*2	The 4th FP net profit base value (minus other operating expenses and non-operating income (loss) required to acquire actual operating income (loss) from
	leasing) is divided by the number of investment units issued and outstanding (356,800 units).					10
*3	Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Earnings Forecasts for 5th Fiscal Period (Ending August 2021) and Thereafter

In the 5th fiscal period, internal growth is expected to increase dividends, and the 6th fiscal period takes into account downtime due to vacancies
Hotels (2 properties) have no risk of reduced revenue due to deals and sponsorship commitments

(yen per unit)

Rental

revenue	Expenses	Other	Non-
	related to	operating
	leasing	operating
	income	Rental	Expenses
	business	expenses

			(loss)	revenue	related to	Other	Non-
					leasing	operating
			No refinancing costs		business	operating
				expenses

							income
							(loss)
							With refinancing costs

200
0
3rd FP	4th FP	5th FP	6th FP
DPU Result DPU Result	DPU Forecast	DPU Forecast

* Figures are rounded down to the indicated digits.

SANKEI REAL ESTATE Inc.

Earnings Forecasts for 5th Fiscal Period (Ending August 2021) and Thereafter

DPU forecast for the 5th FP: +0.5% (+13 yen) from the 4th FP
DPU forecast for the 6th FP: -5.0% (-142 yen) from the 5th FP forecast

(Unit: million yen)


Accounting period	4th FP Results (A)	5th FP Forecasts (B)	Difference	6th FP Forecasts (C)	Difference
(February 2021)	(August 2021)	(B)-(A)	(February 2022)	(C)-(B)


Operating revenue	2,147	2,178	30	2,144	(34)
	Rental and CAM revenue	2,015	2,048	32	2,018	(30)

	Parking revenue	30	29	(0)	29	(0)
	Utilities reimbursement	93	95	1	90	(4)

	Other revenue	8	5	(2)	5	0

Operating expenses	1,029	1,059	30	1,064	4
	Expenses related to leasing	790	817	27	821	3
	business [Total]
		Outsourcing expenses	183	173	(10)	188	15

		Utilities expenses	110	121	10	109	(12)

		Repair expenses	35	53	18	49	(4)
		Property taxes	214	221	6	221	(0)

		Depreciation	227	228	1	233	5

		Other expenses	17	19	1	19	0
	Operating income (loss) from	1,357	1,361	3	1,322	(38)
	leasing
	Total other operating expenses	239	241	2	242	0
		Asset management fee	186	192	5	193	0

		Other expenses	52	49	(3)	49	0
Operating profit	1,118	1,119	0	1,079	(39)
Non-operating income	0	0	(0)	0	0

Non-operating expenses	101	97	(3)	108	11

Ordinary profit	1,017	1,022	4	971	(50)
Net profit	1,016	1,021	4	970	(50)
Distribution per unit (Unit: yen)	2,849 yen	2,862 yen	13 yen	2,720 yen	(142 yen)
NOI	1,585	1,589	4	1,556	(33)

Major Factors for the Difference

5th FP Forecasts (Comparison with 4th FP)

Operating revenue (+30)

Rental and CAM revenue +44 (AKASAKA acquisition +14, rent increase +30)
Rental and CAM revenue -12 (cancellation -8, rent decrease -4)
Other revenue: Cancellation fee -2

Expenses related to leasing business (+27)

Outsourcing expenses: -10 (PM incentive fee -7, other)
Utilities expenses: Seasonal fluctuation (spring and summer) increase +10
Property taxes: AKASAKA acquisition +6.5
Increase in repair expenses +18
Depreciation: AKASAKA acquisition +1.3

6th FP Forecasts (Comparison with 5th FP)

Operating revenue (-34)

Rental and CAM revenue: +8.8 (existing tenants +4.7, new tenants +4.1)
Rental and CAM revenue: -38.8 (existing tenants -7.1, vacancies -31.7)
Utilities reimbursement -4

Expenses related to leasing business (+3)

Outsourcing expenses: +15 (PM incentive fee +12, BM +3)
Utilities expenses: Seasonal fluctuation (autumn and winter) decrease -12
Decrease in repair expenses -4
Depreciation: Increase in renewal work (CAPEX) +5

* Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

Change in NAV per Unit (After Deduction of Distribution) *1

NAV multiple*2

(Unit: yen per unit)

120,000

110,000108,184

11,670

100,000 Unrealized gain

Net 96,515

assets

90,000

End of 4th FP

0.91x

3rd FP

+8.2%

114,157

2nd FP +5.5%

11,744

Increase

in NCF

Capital 102,413 increase

through

public offering

*As of April 9, 2021

1.00x

123,491

4th FP

-1.5%

21,078

Fall in price

calculated at the end of the period fell for some properties

102,413

121,641

19,227

102,413

	End of 1st FP	End of 2nd FP	End of 3rd FP	End of 4th FP
	(End of August 2019)	(End of February 2020)	(End of August 2020)	(End of February 2021)

*1	NAV per unit = (Net assets after deduction of distribution + Unrealized gain on appraisal basis) / Number of investment units issued and outstanding
*2	NAV multiple = Investment unit price (closing price as of relevant date) / NAV per unit
*3	Figures are rounded down to the indicated digits, and ratios are rounded off.				13

SANKEI REAL ESTATE Inc.

2. Internal Growth Results and Strategy

SANKEI REAL ESTATE Inc.

2-1 Internal Growth Results

- Rent revision performance of office buildings (based on closing of books) -

Maintained high occupancy rates and further improved profitability even during the COVID-19 pandemic

 Actual NOI Yield +10bp from previous fiscal period

	Change in		4.0%	4.0%	4.3%	4.4%
	Actual		1st FP		2nd FP	3rd FP	4th FP
		(ended August 2019)		(ended February 2020)	(ended August 2020)	(ended February 2021)
	NOI Yield
		(Fixed assets tax has not been expensed for the 1st FP, 2nd FP, and for S-GATE AKASAKA in the 4th FP. Accordingly, the level during normal operation is

			indicated)
 Average Rent (yen per tsubo)	+4.5% (+823 yen) from previous fiscal period
	Office Buildings		17,992 yen		17,523 yen	18,486 yen	19,309 yen
	Average Rent		As of August 31, 2019		As of February 29, 2020	As of August 31, 2020	As of February 28, 2021
			Average rent (yen per tsubo) = (Rental and CAM revenue upon the most recent settlement / 6 months / Leasable area x Occupancy rate)

					Investment Corporation A: 22,458 yen Investment Corporation B: 20,191 yen
			Cases of Other REITs*
				Investment Corporation C: 18,557 yen
 Occupancy Rate
High occupancy rate maintained
	Change in		100.0%	100.0%	100.0%	99.9%

	Occupancy Rate		As of August 31, 2019		As of February 29, 2020	As of August 31, 2020	As of February 28, 2021


			Cases of Other REITs *		Investment Corporation A: 97.4% Investment Corporation B: 98.4%
					Investment Corporation C: 97.6%	As at the end of February 2021 from each
							investment corporation's website
					COVID-19 crisis
					March 2020
			Before COVID-19 crisis	After COVID-19 crisis

* Figures are estimates by the Asset Management Company based on the most recent disclosed material by extracting investment corporations that are office REITs listed in the "ARES J-REIT Digest" and

of which have over two-thirds of the portfolio held in the Tokyo 23 wards on an acquisition price basis, and the accuracy thereof is thus not guaranteed.

SANKEI REAL ESTATE Inc.

2-1 Internal Growth Results

- Rent revision performance of office buildings for 4th FP (based on conclusion of contracts) *1*2 -

Upward rent revision progressing steadily, centering on tenants under fixed-term leases
Rent Revision Performance of Office Buildings

		Number of	Targeted leased area	Percentage
		(ownership interest of
		targeted tenants	*3
		SANKEI REAL ESTATE)

Increase	Renewal with rent	10	715 tsubos	25.8%
revision/renewal


No change	Renewal with rent	15	2,021 tsubos	73.0%
revision/renewal


Decrease	Renewal with rent	2	33 tsubos	1.2%
revision/renewal


	Total	27	2,769 tsubos	100.0%

Rate of increase

compared with before

+10.2%

 Breakdown of Tenants by Use		 Breakdown of Tenants by Contract Form
No rent decrease for office		Steady rent increase for fixed-term leases

	Office	Retail		Fixed-term Ordinary
Increase	No change	Increase	No change

27%

1	2
13%
10%

Decrease

10 cases	15 cases	2 cases

		11
		73%
100%		100%

*1 Lease contracts concluded during the 4th FP (from September 1, 2020, to the end of February 2021). *2 "Office buildings" refers to office buildings among the assets under management for the 4th FP.

*3 These are the percentages when the area leased to tenants who had rent revisions is deemed 100%.

10 cases	15 cases		2 cases
		1	1
9	13	50%	50%
90%	87%

			16

SANKEI REAL ESTATE Inc.

2-1 Internal Growth Results

- Rent revision performance of office buildings for 4th FP (based on conclusion of contracts) -

 Upward rent revision (1)
Rate of rent increase compared with before

							Renewal with rent revision/renewal
	A-2	BREEZÉ TOWER*1
					(5 cases, 159 tsubos)
		30%				＋24.1%


20%

	32.5%

10%	23.2%		23.4%

0%
1st FP	2nd FP	3rd FP		4th FP

Located in the Umeda area, a business district representing Kansai.
The property is equipped with rooftop greening, green walls, photovoltaic generation facilities, and other energy-saving facilities. The property was rated S rank (the highest rank) in the City of Osaka's Comprehensive Assessment System for Building Environmental Efficiency (CASBEE Osaka) and awarded "CASBEE Osaka of the Year 2008."
The property is an information transmission base having "Sankei Hall BREEZÉ" which inherits the DNA of "Sankei Hall," a theater in Osaka which opened in 1952.

Effect of upward rent revision

Impact on DPU*2

+13 yen

Hotel

Granvia Osaka

Osaka Sta.

Umesankouji

Chuo Post Office

Hilton Plaza

East

Harton Hotel

Nishiumeda

Hilton Osaka

Hilton Plaza

Osaka Mode

West

Gakuen

Daiwa House

Herbis ENT

Industry

Exit 6-47

(Underground)

Umeda

Daibiru

Exit 10

Osaka Ekimae Daiichi Building

Herbis

(Above Ground)

Osaka

OSAKA CENTRAL

POST OFFICE

			Sakurabashi

				Subway
		The Ritz Carlton,
			Yotsubashi
		Osaka
			Line
*1	45% quasi co-ownership interest acquired in sectional ownership of the office portion of the building, etc.

*2	Calculated by converting the amount of increase in monthly rental and CAM revenue into that for the full period (6 months) and dividing it by the
				17
	number of investment units issued and outstanding (356,800 units).
*3	Figures are rounded down to the indicated digits, and ratios are rounded off.

SANKEI REAL ESTATE Inc.

2-1 Internal Growth Results

- Rent revision performance of office buildings for 4th FP (based on conclusion of contracts) -

 Upward rent revision (2)
	A-4	S-GATE AKIHABARA		A-5	Hibiya Sankei Building


			Rate of rent increase			Rate of rent increase
			compared with before			compared with before
			Renewal with rent			Renewal with rent
			revision/renewal			revision/renewal
+15.8%	+10.0%
			New replacement			New replacement
-	-

Reduced downtime and achieved early lease-upof vacant portions

A-9	Omori Park Building	Move out	Accrual of rent

Effects of early lease-up

Impact on DPU	＋22 yen
*1

Forecast

Result

4th FP	5th FP		6th FP


Sep 2020 - Feb 2021	Mar - Aug 2021	Sep 2021 -

12-month leasing period (Including FR; Anticipating longer

leasing period due to COVID-19 pandemic)

Rent generated

Start ofreduced by 5 months contract

Sep 2020 - Dec 2020	Jan - Mar	Apr 2021 -
2021

4-month leasing period + 3 months FR

*1 The amount of increase in monthly rental and CAM revenue for 5 months divided by the number of investment units issued and outstanding

(356,800 units).18

*2 Ratios are rounded to the indicated digits.

SANKEI REAL ESTATE Inc.

2-2 Internal Growth Strategy - Reduce rent gap, continue to aim for internal growth -

Seize internal growth opportunities while maintaining relationship with tenants even amid the COVID-19pandemic

■ Rent Gap*1 (for typical floorplate)

■ Status of Progress and Schedule of Contract

Revision/Renewal (as of February 28, 2021)

(Unit: tsubos)

10 office properties

1,279

5th FP

Progress rate*2

-8.5%

(ending August 2021)

45.9%

(8.8%)

-12.

As of March 2021

As of September 2020

1,987

(on total rent basis; weighted average)

6th FP

(ending February 2022)

(13.6%)

0 tsubos

500 tsubos

1,000 tsubos 1,500 tsubos

2,000 tsubos

 Focused properties

Contract Revision/Renewal Area

Contract Revision/Renewal Planned Area (Ratio to Total Leased Area)*3

Toyo Park Building

A-2

BREEZÉ TOWER

A-7

Assumed occupancy rate of portfolio

All tenants under fixed-term lease

Cancellation due to consolidation of

5th Fiscal Period (Ending August 2021)

Rent gap

bases

・End of period

98.3%

・Period average

99.3%

Strong supply and demand

Vacancy rate rising in the area

6th Fiscal Period (Ending February 2022)

・End of period

100 %

Pursue re-contract

Strengthen leasing

・Period average

97.8%

with rent increase

activities

*1 "Rent Gap" refers to the figure arrived at when the amount of difference between the average rent for SANKEI REAL ESTATE's office building portfolio and the market rent calculated based on assumed new contract rent (typical floorplate) as stated in a market report prepared by CBRE K.K. is divided by the market rent.

*2 "Progress rate" is the value calculated by dividing the total leased area for lease contracts that have been concluded as of February 28, 2021, and whose contract revision/renewal has been completed by the total leased area for each contract revision/renewal period, rounded to one decimal place.

*3 The leased area of the office buildings subject to "contract revision/renewal planned area" is the figure corresponding to the ownership interest acquired by SANKEI REAL ESTATE in each property. "Ratio to total leased area" is the value calculated by dividing the total leased area for each contract revision/renewal period by the total leased area as of February 28, 2021, rounded to one decimal place.

SANKEI REAL ESTATE Inc.

2-2 Internal Growth Strategy - Continuing strategic leasing -

Office leasing market

Current situation

Decline in market rent and rise in vacancy rate of small- and medium- sized buildings
Increase in consolidations and relocations not involving floor space expansion
Corporate earnings strong or recovering except for some business types
Structural change in demand due to entrenchment of remote work, etc.

Outlook

Rise in vacancy rate gradually easing due to decrease in new supply
Future uncertainties clearing
Diversification of demand for office locations (central Tokyo, near work and home, etc.)
Increase in preference for prime locations & high-performance buildings

Portfolio of SANKEI REAL ESTATE

● Office buildings in prime locations*1
Well-balanced
● High-performanceoffice buildings*2
● Office buildings near work and home*3	possession

Average rent less expensive than market rent*4

Occupying tenants not easily affected by

the COVID-19 pandemic

Impact of the COVID-19 pandemic considered limited

Strategic leasing

Leasing utilizing the customer base of the group companies, affiliated companies, network-related companies, etc. of Fuji Media Holdings
Pursuit of negotiations for rent increase with tenants with a rent gap (especially tenants under fixed-term leases)
Diversification of contract period and rescheduling of cancellation notice period ahead of schedule based on property characteristics and tenant attributes
Direct leasing by the Asset Management Company

*1 Tokyo Sankei Building, BREEZÉ TOWER, Hibiya Sankei Building, S-GATE AKASAKA, S-GATENIHONBASHI-HONCHO, and Hatchobori Sankei Building are the applicable properties. *2 Tokyo Sankei Building, BREEZÉ TOWER, Shinagawa Seaside TS Tower, and the S-GATE Series (AKASAKA, NIHONBASI-HONCHO, and AKIHABARA) are the applicable properties. *3 Shinagawa Seaside TS Tower, Toyo Park Building, and Omori Park Building are the applicable properties.

*4 Average rent (yen per tsubo) = Rental and CAM revenue upon the most recent settlement / 6 months / Leasable area x Occupancy rate (presented on page 15)

SANKEI REAL ESTATE Inc.

3. External Growth Results and Strategy

SANKEI REAL ESTATE Inc.

3-1 External Growth Results - Portfolio after acquisition of "S-GATEAKASAKA" -

4th FP

(October 1, 2020)

[As of February 28, 2021]

Acquired

"S-GATE AKASAKA"

New

Large

Number of properties

Asset size

(Total acquisition price)

Appraisal value*1

Acquisition price

per property

Average

appraisal NOI yield*2

Portfolio PML value

Occupancy rate*2

Average walking time*3

Average building age*3

Average typical floorplate*3

12 properties

71.5 billion yen

79.1 billion yen

5.9 billion yen

4.3%

1.7%

99.9%

2.6 minutes

16.5 years

299 tsubos

Sub assets

18.1%

Investment

Ratio by

Asset Type

(acquisition price basis)

Office buildings

81.9%

Other 5.6%

Osaka City

18.3%

Investment

Ratio by

Geographic

Area

(acquisition price basis)

Tokyo 23 wards

76.1%

*1 Appraisal value is calculated based on net operating income derived by the direct capitalization method, with February 28, 2021, as the appraisal date for each. *2 Ratios are rounded to the indicated digits.

*3 Figures are the weighted average based on the acquisition price of each owned property (rounded to the indicated digits).

SANKEI REAL ESTATE Inc.

3-2External Growth Strategy - External growth policy remains unchanged -

 With strong sponsor support and an abundant pipeline, aim for favorable opportunities for external growth
Pipeline from sponsor
Approx. 50 billion yen	200 billion yen
to 100 billion yen	to 300 billion yen
Aim for inclusion
	in global indexes
	FTSE EPRA/Nareit
	Global Real Estate Index
	FTSE Global All Cap Index
100 billion yen
Launch a move to obtain
credit rating
71.5 billion yen
Approx. 0.5
to 1 year

At end of 4th FP	Short-term target	Mid-term target
February 2021

Asset size is based on acquisition price.
The short-term and mid-term asset size targets above are solely the targets, and neither the achievement of the targets nor the timing of achievement are definite or guaranteed. Furthermore, the timing of achievement of the targets may be delayed due to changes in the investment environment, real estate market conditions, etc. and other reasons.

SANKEI REAL ESTATE Inc.

3-2 External Growth Strategy

- Investment unit prices recovering, seeking external growth opportunities -

Highest price		Lowest price	As of
since listing		since listing
		April 9, 2021
February 20, 2020		March 19, 2020

139,300 yen		66,900 yen	121,400 yen
Peak ratio*1	-52.0%	-12.8%

(yen)

Trading volume

SANKEI REAL ESTATE Inc.

TSE REIT Index

NAV per unit (start is book value, value in financial results announcement thereafter)

2/20

10/1 AKASAKA

10/19

acquisition

3rd FP financial results

140,000

Highest price

9/3 1st PO

execution date

briefing

since listing

execution date

9/7 AKASAKA

Distribution: 2,532 yen

130,000

8/6 1st PO

acquisition

+ 9.0% from forecast

launch

announcement

date

120,000

110,000

100,000

90,000

3/19

80,000

Lowest price

since listing

70,000

60,000

19/3/12

19/4/23

19/6/11

19/7/23

19/9/3

19/10/17

19/11/29

20/1/16

20/2/28

20/4/10

20/5/27

20/7/7

20/8/20

20/10/2

20/11/13

20/12/25

21/2/9

21/3/24

(units)

10,000

8,000

6,000

4,000

2,000

		2/20 Highest price since listing
1.25	P/NAV	1.29

1.00

As of 4/9

NAV multiple

1.00

0.75

0.50

3/19 Lowest price since listing

0.59

*1 Peak ratio = 100% - (Investment unit price (closing price as of relevant date) / highest listed value)

*2 The TSE REIT Index is relative to the closing price of investment units on the date of listing of SANKEI REAL ESTATE Inc. (March 12, 2019).

SANKEI REAL ESTATE Inc.

3-2 External Growth Strategy - Being aware of the balance of portfolio matrix -

Target competitive properties exceeding portfolio NOI yields in Greater Tokyo and ordinance-designated cities
For office buildings, place emphasis on location and specifications. For sub-assets, focus on retail and logistics facilities

<Cap. Rate (Appraisal NOI Yield) x Area × Acquisition Price>

Area

Low

2.5%

Central 3 wards of Tokyo		Tokyo 23 wards		Greater Tokyo		Osaka City		Other ordinance-
	(Other than central				designated cities
(Chiyoda, Chuo, and Minato wards)			(Excluding Tokyo)		Nagoya City		Core cities, major
	3 wards of Tokyo)
						regional cities

3.0%

3.5%

	Tokyo Sankei Building
	Typical floorplate
	536 tsubos
	20 years old
S-GATE AKASAKA	1-minute walk

Typical floorplate
158 tsubos	Hotel Intergate
5 years old
Tokyo Kyobashi
1-minute walk	Omori Park Building
3 years old

	Typical floorplate
	1-minute walk

Office buildings

Sub assets

* The size of bubble depends on the acquisition price

Rate	4.0%
Cap.

	4.5%

	342 tsubos
	27 years old
S-GATE	3-minute walk
Hibiya
NIHONBASHI-HONCHO	Sankei Building
Typical floorplate	Typical floorplate
186 tsubos	105 tsubos
2 years old	28 years old
4-minute walk	1-minute walk

S-GATE AKIHABARA	Shinagawa Seaside
Typical floorplate
TS Tower
74 tsubos

Toyo Park Building Typical floorplate

219 tsubos 29 years old

9-minute walk

Target

BREEZÉ TOWER

5.0%

5.5%

6.0%

3 years old	Typical floorplate
446 tsubos
5-minute walk
17 years old

	1-minute walk

Hatchobori Sankei Building

Typical floorplate

201 tsubos 55 years old

3-minute walk

Typical floorplate 406 tsubos 12 years old 3-minute walk

Hotel Intergate

Hiroshima 2 years old

3-minute walk

High

SANKEI REAL ESTATE Inc.

3-2 External Growth Strategy

- Sub-assets are also being developed, centering on office buildings -

■ Main lineup of sponsor

Honmachi Sankei Building

Overview

Hareza Tower

Overview

Location	Honmachi, Chuo-ku,Osaka-shi,
Osaka


Construction completion	August 2021 (scheduled)

Total floor area	29,698 m²

Number of floors	21 floors above ground

Location

Construction completion

Total floor area

Number of floors

Higashi-Ikebukuro,Toshima-ku, Tokyo

May 2020

Approx. 68,600 m²

33 floors above ground and 2 floors below ground

S-GATE HATCHOBORI

Overview

Location	Hatchobori, Chuo-ku, Tokyo

Construction completion	February 2020

Total floor area	Approx. 3,920 m²

Number of floors	10 floors above ground

Otemachi Financial City North Tower

	Overview

Location		Otemachi, Chiyoda-ku, Tokyo

Construction completion		October 2012

Total floor area		Approx. 110,000 m²

		31 floors above ground, 4 floors
Number of floors		below ground and 2-story
		penthouse

Shinagawa Seaside TS Tower

Overview

Location	Higashi-Shinagawa,Shinagawa-ku,
Tokyo


Construction completion	July 2003

Total floor area	Approx. 52,977 m²

Number of floors	25 floors above ground and 2 floors
below ground

* The properties listed above are not properties that are expected to be acquired by SANKEI REAL ESTATE Inc.

Logistics facilities (sponsor-developed properties)

Osaka Area	Greater Tokyo
2 properties	2 properties

SANKEI REAL ESTATE Inc.

MEMO

SANKEI REAL ESTATE Inc.

4. Financial Strategy

SANKEI REAL ESTATE Inc.

Financial Strategy - Financial highlights (1) -

Maintain stable financial base through lender composition centering on mega banks

 Financing Highlights (as of March 12, 2021) Lender Composition (as of March 12, 2021)

Balance of interest-	37.8 billion yen		LTV ratio*1	47.6%	Stable bank formation through financing from 7

bearing liabilities					leading financial institutions of Japan
					[Unit: million yen]

Ratio of	88.6%		Ratio of	73.0%

		Borrowing
long-term debt*2		fixed-rate debt		Percentage
					amount

Average financing	0.34%		Average remaining	2.2 years
interest rate*3		time to maturity

LTV Ratio During Normal Operations

	End of 4th FP	End of 5th FP	End of 6th FP
LTV ratio	47.6%	47.5%	47.4%
(Forecast)	(Forecast)

Mizuho Bank, Ltd.	13,400	35.4%
Sumitomo Mitsui Banking	6,500	17.2%
Corporation

Development Bank of Japan Inc.	5,600	14.8%
Mizuho Trust & Banking Co., Ltd.	3,540	9.4%
Sumitomo Mitsui Trust Bank, Ltd.	3,200	8.5%
Shinsei Bank, Limited	2,780	7.4%
Resona Bank, Ltd.	2,780	7.4%
7 banks in total	37,800	100.00%

*1 "LTV ratio" is total interest-bearing liabilities divided by total assets, rounded to one decimal place.

*2 "Long-term debt " used in the calculation of the "Ratio of long-term debt" does not include long-term borrowings due within one year.

*3 "Average financing interest rate" is the average of applicable interest rates at March 12, 2021. Calculations are on an interest payable basis and do not include arrangement fee and other borrowing

related expenses.

SANKEI REAL ESTATE Inc.

Financial Strategy - Financial highlights (2) -

Continue to promote also staggering of the maturity ladder
Maturity Ladder for Interest-Bearing Liabilities (as of March 12, 2021)

 Refinanced borrowing due in the 5th FP (March 12, 2021)	 Conducted borrowing related to the acquisition
			of "S-GATE AKASAKA" in the 4th FP (October 1, 2020)

	4.8 billion yen	4.8 billion yen	4.3 billion yen
	Long-term borrowing	Long-term borrowing	Long-term borrowing
	Floating interest rate, 2 years	Fixed interest rate, 4 years	Floating interest rate

(Unit: million yen)

7,000
6,000
				5,900		5,900
			5,600
5,000
	4,800								4,800
4,000		4,300						4,300
					3,700
3,000							3,300
2,000
1,000
0
4th FP	5th FP	6th FP	7th FP	8th FP	9th FP	10th FP	11th FP	12th FP	13th FP

Long-term borrowings

SANKEI REAL ESTATE Inc.

5. ESG Initiatives

SANKEI REAL ESTATE Inc.

ESG Initiatives: ESG Topics (1) - Establishment of sustainability policy, etc. -

Sustainability Policy

Established for the purpose of enhancing sustainability initiatives based on the recognition that consideration for sustainability is essential to the sustainable improvement of SANKEI REAL ESTATE's medium- to long-termcompetitiveness and unitholder value

(1)	Preserving the earth environment and reducing the	(4)	Working with executives and employees
	environmental load of assets under management
(2) Serving the local community	(5)	Observing compliance and establishing/maintaining an
			internal control system
(3)	Cooperating with external stakeholders	(6)	Disclosing ESG information and securing transparency

Sustainability Promotion System Rules	Various Policies and Manuals
 Providing for establishment of various policies, internal	 The following policies and manuals have

structure of the Asset Management Company, basic policies on cooperating with external stakeholders and information disclosure, and other matters related to sustainability

been established to put the Sustainability Policy into practice

Sustainability Promotion System

Chief Sustainability Officer: Executive Deputy President

Sustainability Officer: General Manager of Investment Management Department

Sustainability promotion meetings: Examining and planning various policies, targets, and measures related to sustainability

Policy on energy conservation

Policy on greenhouse gas emissions reduction Policy on saving water

Policy on sustainable procurement EMS operational manual

SANKEI REAL ESTATE Inc.

ESG Initiatives: ESG Topics (2)

Governance (Internal Control)

Sponsor Commitment: Promotion of Same-BoatInvestment by Sponsor
- Sankei Building, the sponsor, conducted additional acquisition of the investment units of SANKEI REAL ESTATE in the 4th FP, too
- With further increase in same-boat investment with the unitholders of SANKEI REAL ESTATE, strong sponsor support contributing to the medium- to long-term growth of SANKEI REAL ESTATE is expected


	End of 2nd FP	End of 3rd FP	Additionally acquired	End of 4th FP
	units


Number of investment units	356,800 units	356,800 units	－	356,800 units
issued and outstanding


Number of units	11,362 units	14,979 units	2,500 units	17,479 units
held by sponsor


Percentage of units	3.18%	4.19%	0.70%	4.89%
held by sponsor

Participation in 2021 GRESB Real Estate Assessment

GRESB Real Estate Assessment: A global investment benchmark established as a tool to measure the environmental, social, and governance (ESG) considerations of individual companies and funds in the real estate sector and used to select investment targets and engage in dialogue with investment targets.
- Roadmap (planned)

2021

Apr.	May	Jun.	Jul.	Aug.	Sep.	Oct.

Assessment opens

Prepare response

Validation and scoring

● Release of preliminary results

● Release of final results

SANKEI REAL ESTATE Inc.

ESG Initiatives: Environment (1)

Received DBJ Green Building Certification, which certifies properties that give proper care to the environment and society, for 5 properties (including 2 properties for which the sponsor received certification) among 12 properties under management

A-3	S-GATENIHONBASHI-HONCHO		A-4	S-GATE AKIHABARA	A-10	S-GATE AKASAKA
(51% co-ownership interest)				(60% quasi co-ownership interest)
					Recipient: SANKEI REAL ESTATE Inc.
Recipient: SANKEI REAL ESTATE Inc.		Recipient: SANKEI REAL ESTATE Inc.

A-1 Tokyo Sankei Building

(2% co-ownership interest)

Recipient: The Sankei Building Co., Ltd. (sponsor)

BREEZÉ TOWER

A-2 (45% quasi co-ownership interest in sectional ownership of the office portion of the building, etc.)

Recipient: The Sankei Building Co., Ltd. (sponsor)

SANKEI REAL ESTATE Inc.

ESG Initiatives: Environment (2)

Approximately 30% progress in switching to LED at both the exclusively owned areas and common areas of office buildings

Major environmental initiatives

	 Sequentially introduce LED lighting and dimming control systems
Tokyo Sankei Building	 Increase the number of dimming and blinking sections, enabling narrowing down of the
Installation of energy-saving and long-life	necessary lighting areas
LED lighting	 Introduce lighting control by brightness sensor, allowing the office illumination settings to
	be freely set from the disaster prevention center

Tokyo Sankei Building,	 Install electric vehicle (EV) charger in the parking lot as part of Sankei Building's
and BREEZÉ TOWER	environmental protection measures
Installation of electric vehicle (EV)	 Install 200V fast charger that can recharge standard electric vehicles to 80% in 30 minutes
chargers	at BREEZÉ TOWER

Tokyo Sankei Building	 Install Chiyoda Ward's community cycle service ports as social contribution activities in
support of the project that Chiyoda Ward is proactively working on as activities to reduce
Installation of community cycle ports
CO2 emissions and raise environmental awareness

BREEZÉ TOWER	 Improve comfort and reduce solar heat with double skin/Low-e glass
Reduction of building heat load


	 Adopt automatic dimming control with the use of daylight and correction of initial
BREEZÉ TOWER	illuminance
 Use of indirect light with blind automatic control system
Effective use of natural energy
 Achieve energy saving using outside air-cooling system in the middle period and winter

	 Adopt solar power system
BREEZÉ TOWER	 Reuse of rainwater and greywater (use as toilet flushing water, and automatic plant
Effective use of water resources and
irrigation)
consideration for surrounding
 Water-saving effect with the adoption of water-saving equipment
environment


S-GATE	 Rooftop greening efforts and establish terrace, and use greenery also at the entrance for
Rooftop greening (establishment of
an open and bright approach
terrace) and greenery at entrance

SANKEI REAL ESTATE Inc.

ESG Initiatives: Social

Response to the COVID-19 pandemic

Prevention

Introduce remote work and staggered commuting
Prepare alcohol disinfectants at common areas
Health management of property management staff
Display posters for preventing the spread of infection

When someone is infected with COVID-19

- Identify the behavioral history of infected persons and persons who had close contact with them
- Implement disinfection work at the office and common areas
- Contact the tenants, etc. who use the building
Relationship with stakeholders

Measures for employees

Develop a comfortable office environment
Human resources development: Implement various training
Work-stylesupport: Childcare and nursing care support

Measures for tenants

Implement disaster prevention drills, and distribute disaster prevention goods
Conduct tenant satisfaction surveys

Connection with the community

Installation of artwork

Poster on preventing

the spread of COVID-19

Installation of artwork

（Tokyo Sankei Building）

Room for employees

Distribute disaster prevention goods

SANKEI REAL ESTATE Inc.

Appendix

SANKEI REAL ESTATE Inc.

4th Fiscal Period (Ended February 2021) Balance Sheet (Unabridged)

(Unit: thousand yen)

		3rd FP	4th FP
		(as of Aug. 31, 2020)	(as of Feb. 28, 2021)
Assets
Current assets
Cash and deposits	3,876,992	4,147,117
Cash and deposits in trust	3,283,341	2,797,010
Operating accounts receivable	87,957	54,096
Prepaid expenses	51,898	46,597
Consumption taxes receivable	-	9,321
Other	567,790	41,015
Total current assets	7,867,979	7,095,157
Non-current assets
Property, plant and equipment
	Buildings	165,538	166,032
	Accumulated depreciation	(8,698)	(11,908)
	Buildings, net	156,839	154,123
	Structures	353	353
	Accumulated depreciation	(12)	(16)
	Structures, net	340	336
	Land	2,457,766	2,457,766
	Buildings in trust	13,624,054	14,296,308
	Accumulated depreciation	(547,766)	(769,403)
	Buildings in trust, net	13,076,288	13,526,905
	Structures in trust	22,236	23,602
	Accumulated depreciation	(813)	(1,122)
	Structures in trust, net	21,422	22,479
	Machinery and equipment in trust	2,608	2,875
	Accumulated depreciation	(208)	(348)
	Machinery and equipment in trust, net	2,400	2,526
	Tools, furniture and fixtures in trust	25,419	27,889
	Accumulated depreciation	(1,901)	(3,719)
	Tools, furniture and fixtures in trust , net	23,518	24,170
	Land in trust	52,510,871	56,132,321
	Construction in progress in trust	330	8,103
	Total property, plant and equipment	68,249,777	72,328,733
Intangible assets
Software	6,713	5,773
Total intangible assets	6,713	5,773
Investments and other assets
Long-term prepaid expenses	60,793	43,237
Deferred tax assets	14	13
Leasehold and guarantee deposits	10,000	10,000
Total investments and other assets	70,807	53,251
Total non-current assets	68,327,298	72,387,757
Total assets	76,195,278	79,482,915

	3rd FP	4th FP
	(as of Aug. 31, 2020)	(as of Feb. 28, 2021)
Liabilities
Current liabilities
Operating accounts payable	205,128	170,112
Long-term borrowings due within 1 year	4,800,000	9,100,000
Accounts payable - other	214,600	219,582
Accrued expenses	26,272	26,175
Income taxes payable	893	879
Consumption taxes payable	129,470	-
Advances received	328,557	373,814
Deposits received	1,205,174	7,496
Total current liabilities	6,910,097	9,898,060
Non-current liabilities
Long-term borrowings	28,700,000	28,700,000
Leasehold and guarantee deposits received	92,935	79,585
Leasehold and guarantee deposits received in trust	3,047,718	3,247,634
Total non-current liabilities	31,840,654	32,027,219
Total liabilities	38,750,751	41,925,280

Net assets
Unitholders' equity
Unitholders' capital	36,540,901	36,540,901
Surplus
Unappropriated retained earnings (undisposed loss)	903,625	1,016,734
Total surplus	903,625	1,016,734
Total unitholders' equity	37,444,526	37,557,635
Total net assets	37,444,526	37,557,635
Total liabilities and net assets	76,195,278	79,482,915

SANKEI REAL ESTATE Inc.

4th Fiscal Period (Ended February 2021) Statement of Income (Unabridged)

		(Unit: thousand yen)
	3rd FP	4th FP
	(ended Aug. 2020)	(ended Feb. 2021)
Operating revenue
Leasing business revenue	1,878,684	2,015,771
Other leasing business revenue	126,823	132,163
Total operating revenue	2,005,507	2,147,934
Operating expenses
Expenses related to leasing business	778,934	790,014
Asset management fee	183,485	186,562
Asset custody fee	1,505	1,568
Administrative service fees	6,370	7,065
Remuneration for directors (and other officers)	3,600	3,600
Other operating expenses	35,230	40,510
Total operating expenses	1,009,126	1,029,320
Operating profit	996,380	1,118,614
Non-operating income
Interest income	32	21
Interest on refund	323	-
Other non-operating income	-	0
Total non-operating income	356	21
Non-operating expenses
Interest expenses	58,586	61,565
Borrowing related expenses	33,790	37,660
Other non-operating expenses	-	2,000
Total non-operating expenses	92,377	101,225
Ordinary profit	904,359	1,017,409
Net profit before income taxes	904,359	1,017,409
Income taxes - current	898	882
Income taxes - deferred	2	0
Total income taxes	901	883
Net profit	903,458	1,016,526
Retained earnings brought forward	167	207
Unappropriated retained earnings (undisposed loss)	903,625	1,016,734

SANKEI REAL ESTATE Inc.

4th Fiscal Period (Ended February 2021) Statement of Cash Flows

		(Unit: thousand yen)

	3rd FP	4th FP
	(ended Aug. 2020)	(ended Feb. 2021)
Cash flows from operating activities
Net profit before income taxes	904,359	1,017,409

Depreciation	220,471	228,057
Interest income	(32)	(21)
Interest expenses	58,586	61,565
Decrease (increase) in operating accounts receivable	(23,792)	34,103
Decrease (increase) in consumption taxes refund receivable	369,256	(9,321)
Decrease (increase) in prepaid expenses	(10,700)	5,300
Increase (decrease) in operating accounts payable	58,297	(54,667)
Increase (decrease) in accounts payable - other	52,356	4,076
Increase (decrease) in consumption taxes payable	129,470	(129,470)
Increase (decrease) in advances received	(12,866)	45,256
Increase (decrease) in deposits received	254,170	(1,197,677)
Decrease (increase) in long-term prepaid expenses	(915)	17,555
Decrease (increase) in other assets	(225,717)	526,775
Subtotal	1,772,944	548,943
Interest received	32	21
Interest paid	(57,188)	(61,662)
Income taxes paid	(951)	(896)
Net cash provided by (used in) operating activities	1,714,837	486,405
Cash flows from investing activities
Purchase of property, plant and equipment	(5,747)	(493)
Purchase of property, plant and equipment in trust	(46,376)	(4,286,634)
Proceeds from leasehold and guarantee deposits received	1,400	81
Refund of leasehold and guarantee deposits received	(502)	(12,724)
Proceeds from leasehold and guarantee deposits received in trust	142,697	232,800
Refund of leasehold and guarantee deposits received in trust	(8)	(33,127)
Net cash provided by (used in) investing activities	91,461	(4,100,099)
Cash flows from financing activities
Repayments of short-term borrowings	(4,756,000)	-
Proceeds from long-term borrowings	4,300,000	4,300,000
Distribution paid	(1,067,674)	(902,512)
Net cash provided by (used in) financing activities	(1,523,674)	3,397,487
Net increase (decrease) in cash and cash equivalents	282,624	(216,205)
Cash and cash equivalents at beginning of period	6,877,708	7,160,333
Cash and cash equivalents at end of period	7,160,333	6,944,127

SANKEI REAL ESTATE Inc.

Key Performance Indicators (KPIs)

		3rd FP	4th FP
		(ended Aug. 2020)	(ended Feb. 2021)
	(against total assets)	44.0%	47.6%
LTV
(against total assets <>	40.0%	43.8%

	unrealized gain/loss>)


	(against book value)	4.2%	4.4%
NOI yield
(against appraisal value)	3.8%	4.0%


NOI yield after	(against book value)	3.6%	3.8%

depreciation	(against appraisal value)	3.2%	3.4%


	(NOI yield)	4.7%	4.3%
Implied cap rate
(NOI yield after depreciation)	4.0%	3.7%


FFO	1,122 million yen	1,243 million yen

AFFO	1,068 million yen	1,201 million yen

FFO per unit	3,147 yen	3,485 yen

EPS	2,532 yen	2,849 yen

		3rd FP	4th FP
		(ended Aug. 2020)	(ended Feb. 2021)
Distribution per unit	2,532 yen	2,849 yen

Distribution yield	5.6%	5.2%

ROE	4.8%	5.4%

Net assets per unit	104,945 yen	105,262 yen

NAV per unit	126,023 yen	124,489 yen

Investment unit price (at end of period)	90,800 yen	110,200 yen

NAV multiple	0.7x	0.9x

PBR	0.9x	1.0x

PER	17.9x	19.3x

FFO multiple	14.4x	15.8x

	(FFO)	80.4%	81.7%
Payout ratio
(AFFO)	84.5%	84.6%

*1.	LTV (against total assets) = Interest-bearing liabilities / Total assets (book value)	*9.	Distribution per unit = Total distribution / Total number of investment units issued and
	LTV (against total assets ) = Interest-bearing liabilities / (Total assets		outstanding at end of period
	(book value) + unrealized gain/loss)	*10.	Distribution yield = Distribution per unit (Annualized result of current FP x 2) / Investment
*2.	NOI yield (against book value) = (Operating income from real estate leasing + Depreciation) /Book value		unit price (at end of period)
	of real estate for lease	*11.	ROE (Return on equity) = Net profit (Annualized most recent result x 2) / Net assets
	NOI yield (against appraisal value) = (Operating income from real estate leasing + Depreciation) /	*12.	NAV per unit = (Net assets + Unrealized gain/loss) / Total number of investment units
	Appraisal value of real estate for lease		issued and outstanding at end of period
*3.	NOI yield after depreciation (against book value) = Operating income from real estate leasing / Book	*13.	NAV multiple = Investment unit price (at end of period) / NAV per unit
	value of real estate for lease	*14.	PBR (Price Book-value Ratio) = Investment unit price (at end of period) / Net assets per
	NOI yield after depreciation (against appraisal value) = Operating income from real estate leasing /		unit
	Appraisal value of real estate for lease	*15.	PER (Price Earnings Ratio) = Investment unit price (at end of period) / EPS (Annualized
*4.	Implied cap rate (NOI yield) = NOI (Annualized result of current FP x 2) / (Total fair value +Interest-		most recent result x 2)
	bearing liabilities - Cash and deposits + Leasehold deposits received)	*16.	FFO multiple = Investment unit price / FFO per unit (Annualized most recent result x 2)
	Implied cap rate (NOI yield after depreciation) = NOI after depreciation (Annualized result of current FP	*17.	Payout ratio (FFO) = Total distribution / FFO
	x2) / (Total fair value + Interest-bearing liabilities - Cash and deposits + Leasehold deposits received)	*18.	Payout ratio (AFFO) = Total distribution / AFFO
*5.	FFO = Net profit + Depreciation - Gain/loss on sales of real estate properties (including loss on	*19.	Figures are rounded down to the indicated digits (Percentages and multiples are rounded
	retirement of non-current assets)		to one decimal place.)
*6.	AFFO = FFO - Capital expenditure
*7.	FFO per unit = FFO / Total number of investment units issued and outstanding at end of period			41
*8.	EPS = Net profit / Total number of investment units issued and outstanding at end of period

SANKEI REAL ESTATE Inc.

Status of Lenders (as of March 12, 2021)

Term

Long-term borrowings

		Borrowing	Interest rate	Maturity
Lender	amount	date
(*1)
		(million yen)	(*2)

Mizuho Bank, Ltd.
	1,574
Sumitomo Mitsui Banking		1,084
Corporation
Development Bank of Japan Inc.		929
Mizuho Trust & Banking Co., Ltd.		593	0.36969%	March 12,
	(fixed)	2022
Sumitomo Mitsui Trust Bank, Ltd.		542
Shinsei Bank, Limited		439
Resona Bank, Limited		439

Mizuho Bank, Ltd.		972
Sumitomo Mitsui Banking		716
Corporation
Development Bank of Japan Inc.		614
Mizuho Trust & Banking Co., Ltd.		392	0.42346%	March 12,
	(fixed)	2023
Sumitomo Mitsui Trust Bank, Ltd.		358
Shinsei Bank, Limited		324
Resona Bank, Limited		324

Mizuho Bank, Ltd.		856
Sumitomo Mitsui Banking		639
Corporation
Development Bank of Japan Inc.		548
Mizuho Trust & Banking Co., Ltd.		350	0.49096%	March 12,
	(fixed)	2024
Sumitomo Mitsui Trust Bank, Ltd.		319
Shinsei Bank, Limited		294
Resona Bank, Limited		294
Mizuho Bank, Ltd.		2,250
Sumitomo Mitsui Banking		1,500
Corporation
Mizuho Trust & Banking Co., Ltd.		620	0.27909%	September 3,

Sumitomo Mitsui Trust Bank, Ltd.		550	(floating)	2022

Shinsei Bank, Limited		490
Resona Bank, Limited		490

Repayment Description method

Lump-sum Unsecured

repayment Non- at maturity guaranteed

		Borrowing	Interest rate	Maturity	Repayment
Term	Lender	amount	date	Description
(*1)	method
		(million yen)	(*2)


	Mizuho Bank, Ltd.	950

	Sumitomo Mitsui Banking	800
	Corporation
	Development Bank of Japan Inc.	2,000
	Mizuho Trust & Banking Co., Ltd.	620	0.36200%	September 3,
	(fixed)	2023
	Sumitomo Mitsui Trust Bank, Ltd.	550
	Shinsei Bank, Limited	490
	Resona Bank, Limited	490
	Mizuho Bank, Ltd.	1,167
borrowings	Sumitomo Mitsui Banking	832
Corporation	(fixed)	2024

	Development Bank of Japan Inc.	713
	Mizuho Trust & Banking Co., Ltd.	456	0.32923%	September 12,	Lump-sum	Unsecured
-term	Sumitomo Mitsui Trust Bank, Ltd.	416			repayment	Non-
		at maturity	guaranteed

Shinsei Bank, Limited	358
Long
Resona Bank, Limited	358

	Mizuho Bank, Ltd.	1,331
	Sumitomo Mitsui Banking	929
	Corporation
	Development Bank of Japan Inc.	796
	Mizuho Trust & Banking Co., Ltd.	509	0.36978%	March 12,
	(fixed)	2025
	Sumitomo Mitsui Trust Bank, Ltd.	465
	Shinsei Bank, Limited	385
	Resona Bank, Limited	385
	Mizuho Bank, Ltd.	4,300	0.22727%	October 1,
	(floating)	2021

	Total	37,800

*1. Interest rates indicated are the applicable interest rates as of March 12, 2021.

*2. If the maturity date is not a business day, it will be the following business day.

SANKEI REAL ESTATE Inc.

4th Fiscal Period (Ended February 2021) Statement of Income from Leasing by Property

					(Unit: thousand yen)

Property number	A-1	A-2	A-3	A-4	A-5	A-6
Asset type	Office buildings	Office buildings	Office buildings	Office buildings	Office buildings	Office buildings
	Tokyo		S-GATE	S-GATE	Hibiya	Hatchobori
Property name	BREEZÉ TOWER	NIHONBASHI-
Sankei Building	AKIHABARA	Sankei Building	Sankei Building
		HONCHO

Leasing business revenue	60,396	531,280	160,529	62,652	209,800	176,523

Rental revenue	49,010	418,757	153,523	59,774	183,364	145,970

CAM revenue	2,438	88,165	-	-	13,232	13,790

Utilities reimbursement	5,219	16,134	4,105	2,448	10,131	8,809

Parking revenue	764	7,241	2,763	378	1,932	6,476

Other rental revenue	2,963	981	137	51	1,140	1,475

Expenses related to	30,012	211,497	43,374	25,100	92,895	60,826
leasing business

Outsourcing expenses	6,158	65,762	8,998	8,505	18,075	17,048

Utilities expenses	3,023	31,174	4,818	2,489	8,323	10,108

Property taxes	12,303	37,132	10,610	4,821	53,901	10,144

Land rent	683	1,135	-	-	-	-

Repair expenses	2,171	10,211	-	618	6,041	6,331

Insurance premium	112	954	353	170	308	474

Trust fee	-	(328)	250	250	250	250

Depreciation	3,213	63,298	18,036	7,623	5,561	15,767

Other expenses from	2,346	2,157	306	620	435	701
leasing

Operating income (loss)	30,383	319,783	117,155	37,552	116,904	115,696
from leasing

NOI	33,597	383,081	135,192	45,176	122,466	131,463

*1 The information is "Not disclosed" due to unavoidable circumstances in that such contains information for which consent for disclosure has not been

obtained from the tenant, relevant party, etc. or information from which confidential information can be derived.

*2 Figures are rounded down to the indicated digits.

SANKEI REAL ESTATE Inc.

4th Fiscal Period (Ended February 2021) Statement of Income from Leasing by Property

										(Unit: thousand yen)

Property number	A-7		A-8	A-9		A-10	B-1	B-2	Total

Asset type	Office buildings	Office buildings	Office buildings	Office buildings	Sub assets	Sub assets
Property name	Toyo	Shinagawa Seaside	Omori		S-GATE	Hotel Intergate	Hotel Intergate
Park Building		TS Tower*1	Park Building		AKASAKA*1	Tokyo Kyobashi	Hiroshima

Leasing business revenue	115,778				154,633				206,955	118,800	2,147,934

Rental revenue	84,030				125,452				206,955	118,800	1,868,319

CAM revenue	19,788				10,037				-	-	147,452

Utilities reimbursement	9,539				12,970				-	-	93,366

Parking revenue	2,340				5,400				-	-	30,655

Other rental revenue	80				773				-	-	8,141
	(Not			(Not
Expenses related to	38,337			65,709			54,436	43,574	790,014
leasing business		disclosed)			disclosed)

Outsourcing expenses	9,094		15,349		1,200	1,800	183,374



Utilities expenses	7,553				16,007				-	-	110,924

Property taxes	7,619				16,047				25,629	15,388	214,815

Land rent	-				-				-	-	1,818

Repair expenses	3,627				1,654				-	19	35,844

Insurance premium	257				493				543	496	4,664

Trust fee	350				350				250	250	2,371

Depreciation	9,519	30,079	15,220	6,453	26,770	25,572	227,117

Other expenses from	315				586				43	47	9,081
leasing

Operating income (loss)	77,441	167,855	88,923	58,478	152,519	75,225	1,357,920
from leasing

NOI	86,960	197,935	104,144	64,931	179,289	100,798	1,585,038

*1 The information is "Not disclosed" due to unavoidable circumstances in that such contains information for which consent for disclosure has not been obtained from the tenant, relevant party, etc. or information from which confidential information can be derived.

*2 Figures are rounded down to the indicated digits.

SANKEI REAL ESTATE Inc.

Portfolio List (1) (as of February 28, 2021)

Property number	A-1	A-2	A-3	A-4	A-5	A-6
Asset type	Office buildings	Office buildings	Office buildings	Office buildings	Office buildings	Office buildings

Property name	Tokyo Sankei Building	BREEZÉ TOWER	S-GATE	S-GATE AKIHABARA	Hibiya	Hatchobori
NIHONBASHI-HONCHO	Sankei Building	Sankei Building

		(45% quasi co-ownership
	(2% co-ownership	interest in sectional	(51% co-ownership
	interest)	ownership of the office	interest)
		portion of the building, etc.)


Location	Chiyoda-ku, Tokyo	Kita-ku,Osaka-shi	Chuo-ku, Tokyo	Chiyoda-ku, Tokyo	Chiyoda-ku, Tokyo	Chuo-ku, Tokyo

Acquisition date	Mar. 12, 2019	① Mar. 12, 2019	Mar. 12, 2019	Mar. 12, 2019	Mar. 12, 2019	Mar. 12, 2019
② Sep. 3, 2019*

Acquisition price	2,509 million yen	13,100 million yen	6,698 million yen	2,055 million yen	5,829 million yen	4,959 million yen

Appraisal value	2,690 million yen	17,235 million yen	7,470 million yen	2,530 million yen	6,340 million yen	5,500 million yen

Appraisal NOI yield	2.9%	5.5%	3.8%	4.4%	3.6%	5.1%
(Appraisal NOI/Acquisition price)


Construction completion	Sep. 2000	Jul. 2008	Oct. 2018	Sep. 2017	Jun. 1992	Sep. 1965

Occupancy rate	91.6%	100.0%	100.0%	100.0%	100.0%	100.0%

PML value	2.3%	2.8%	2.0%	2.2%	3.1%	0.3%

* The first acquisition of BREEZÉ TOWER was made on March 12, 2019, and the second acquisition on September 3, 2019.

SANKEI REAL ESTATE Inc.

Portfolio List (2) (as of February 28, 2021)

Property number	A-7	A-8	A-9	A-10	B-1	B-2
Asset type	Office buildings	Office buildings	Office buildings	Office buildings	Sub assets	Sub assets

Property name	Toyo Park Building	Shinagawa Seaside	Omori Park Building	S-GATE AKASAKA	Hotel Intergate	Hotel Intergate
TS Tower	Tokyo Kyobashi	Hiroshima

		(25% quasi co-ownership
		interest in sectional		(60% quasi co-ownership
		ownership of the building,		interest)
		etc.)


Location	Koto-ku, Tokyo	Shinagawa-ku, Tokyo	Ota-ku, Tokyo	Minato-ku, Tokyo	Chuo-ku, Tokyo	Naka-ku,Hiroshima-shi

Acquisition date	Mar. 12, 2019	Sep. 3, 2019	Sep. 3, 2019	Oct. 1, 2020	Mar. 12, 2019		Sep. 3, 2019

Acquisition price	3,782 million yen	10,040 million yen	5,400 million yen	4,200 million yen	8,961 million yen	3,990 million yen

Appraisal value	3,610 million yen	11,000 million yen	5,490 million yen	4,266 million yen	8,970 million yen	4,080 million yen

Appraisal NOI yield	4.0%	4.3%	4.1%	3.3%	3.9%		4.9%
(Appraisal NOI/Acquisition price)


Construction completion	Jun. 1991	Jul. 2003	May 1993	Jul. 2015	Jan. 2018		Oct. 2018

Occupancy rate	100.0%	100.0%	100.0%	100.0%	100.0%		100.0%

PML value	9.0%	3.2%	5.6%	4.6%	1.8%		2.1%


						PML value (average)		1.7%

SANKEI REAL ESTATE Inc.

Overview of Appraisal Value at the End of 4th Fiscal Period

												(Unit: million yen)
				At acquisition*1		End of 4th FP*2		Change
Property	Property name	Acquisition	End of 4th FP	(a)		(February 28, 2021) (b)	(b)-(a)			Unrealized
number	price	Book value				gain/loss
	Appraisal value		CR*3	Appraisal value	CR*3	Appraisal value		CR*3

A-1	Tokyo Sankei Building	2,509	2,612	2,540		2.6%	2,690		2.5%	150	-0.1pt		78
(2% co-ownership interest)

	BREEZÉ TOWER
A-2	(45% quasi co-ownership interest in sectional	13,100	13,130	13,905		3.9%	17,235		3.8%	3,330	-0.1pt		4,105
ownership of the office portion of the building,

	etc.)
A-3	S-GATENIHONBASHI-HONCHO	6,698	6,725	6,780		3.7%	7,470		3.3%	690	-0.4pt		745
(51% co-ownership interest)

A-4	S-GATE AKIHABARA	2,055	2,059	2,080		3.8%	2,530		3.5%	450	-0.3pt		471

A-5	Hibiya Sankei Building	5,829	6,051	5,900		3.3%	6,340		3.0%	440	-0.3pt		289

A-6	Hatchobori Sankei Building	4,959	5,020	5,020		4.2%	5,500		4.1%	480	-0.1pt		480

A-7	Toyo Park Building	3,782	3,881	3,790		4.2%	3,610		4.0%	-180	-0.2pt		-271

	Shinagawa Seaside TS Tower
A-8	(25% quasi co-ownership interest in sectional	10,040	10,132	10,200		3.6%	11,000		3.6%	800	0.0pt		868
	ownership of the building, etc.)
A-9	Omori Park Building	5,400	5,477	5,600		3.9%	5,490		3.8%	-110	-0.1pt		13

A-10	S-GATE AKASAKA	4,200	4,249	4,266		3.2%	4,266		3.2%	0	0.0pt		17
(60% quasi co-ownership interest)

Office buildings subtotal (total of 10 properties)	58,574	59,340	60,081			66,131			6,050			6,791

B-1	Hotel Intergate Tokyo Kyobashi	8,961	9,004	9,070		3.8%	8,970		3.8%	-100	0.0pt		-34

B-2	Hotel Intergate Hiroshima	3,990	3,974	4,080		4.6%	4,080		4.6%	0	0.0pt		106

Sub assets subtotal (total of 2 properties)	12,951	12,979	13,150			13,050			-100			71
Portfolio total (total of 12 properties)	71,525	72,320	73,231			79,181			5,950			6,861

*1. The appraisal value with October 31, 2018, as the appraisal date is indicated for A-1,A-3 to A-7, and B-1, the appraisal value with July 1, 2019, as the appraisal date for A-8,A-9, and B-2, the total appraisal value with October 31, 2018, and July 1, 2019, as the appraisal dates for A-2, and the appraisal value with August 1, 2020, as the appraisal date for A-10.

*2. The appraisal value with February 28, 2021, as the appraisal date.

*3. CR is a cap rate based on direct capitalization method (NCF basis). For the CR at the time of acquisition of BREEZÉ TOWER, the weighted average based on each acquisition price of the quasi co- ownership interest in sectional ownership of the office portion of the building, etc. acquired on March 12, 2019, and September 3, 2019, is stated.

SANKEI REAL ESTATE Inc.

Portfolio at End of 4th Fiscal Period

SANKEI REAL ESTATE's high-quality portfolio is supported by strong sponsor support

Sponsor support rate 100%

Percentage by Walking

Time to the Nearest Station*1

 Within 1 minute	44%
Within 3 minutes	83%
Within 5 minutes	95%

More than 5 minutes

More than 5.3%

3 minutes, but within 5

minutes 12.2%

Within

1 minute

Average*2 44.1%

2.6 minutes

More than 1 minute, but within 3 minutes

38.4%

New

Percentage by

Building Age*1

Within 10 years 36% Within 20 years 69% Within 30 years 93%

More than
	30 years
	6.9%
More than 20 years,		Within
but within 30 years
Average*2	10 years
24.5%	16.5 years	36.2%

More than
15 years,	More than
but within
10 years, but
20 years
within 15 years
14.0%
18.3%

Large

Percentage by

Typical Floorplate*1

 Large-scale buildings	68%	*3
Large buildings	96%

Less than
100 tsubos
3.5%
100 tsubos or more,
but less than 200 tsubos
28.6%		400 tsubos
	or more
Average*2

299 tsubos	43.8%
200 tsubos
or more, but less	300 tsubos or more,
than 300 tsubos
but less than 400

14.9%	tsubos
	9.2%

	All Properties	All Properties	Office Buildings Only
*1	Calculated based on the acquisition price of each owned property as of February 28, 2020.
*2	Figures are the weighted average based on the acquisition price of each owned property (rounded to the indicated digits).
*3	Calculated based on the definition of "Large-scale buildings: 200 tsubo or more" and "Large buildings: 100 tsubos or more, but less than 200 tsubos"		48
	made by Sanko Estate Co., Ltd.

SANKEI REAL ESTATE Inc.

Portfolio Matrix at End of 4th Fiscal Period (1)

<Cap. Rate (Appraisal NOI Yield) x Area>

Area

(Unit: million yen)

Cap. Rate

Area	Central 3 wards of Tokyo	Tokyo 23 wards	Greater Tokyo	Osaka City		Other ordinance-designated cities	Total acquisition
	price
	(Chiyoda, Chuo, and Minato wards)	(Other than the central 3 wards of Tokyo)	(Excluding	Nagoya City	Core cities, major regional cities	(Overall ratio)
	Tokyo)

Appraisal	Property name	Property name		Property name	Property name
NOI	Building age, walking	Acquisition price	Building age, walking	Acquisition price		Building age, walking	Acquisition price	Building age, walking	Acquisition price

CAP
time from station	(million yen)	time from station	(million yen)		time from station	(million yen)	time from station	(million yen)

Less than	Tokyo Sankei Building								2,509

3.0%	20 years old,	2,509								(3.5%)
	1-minute walk

Less than	S-GATE AKASAKA								4,200
3.5%	5 years old,	4,200								(5.9%)
	1-minute walk
	Hibiya Sankei Building

	28 years old,	5,829
	1-minute walk
Less than	S-GATENIHONBASHI-HONCHO							21,488

4.0%	2 years old,	6,698								(30.0%)
	4-minute walk
	Hotel Intergate Tokyo Kyobashi

	3 years old,	8,961
	1-minute walk
	S-GATE AKIHABARA	Shinagawa Seaside TS Tower
	3 years old,	2,055	17 years old,	10,040
	5-minute walk	1-minute walk
Less than			Omori Park Building						21,277
		27 years old,
4.5%			5,400						(29.7%)
			3-minute walk
			Toyo Park Building
			29 years old,	3,782
			9-minute walk
Less than								Hotel Intergate Hiroshima	3,990
							2 years old,
5.0%								3,990	(5.6%)
								3-minute walk
5.0%	Hatchobori Sankei Building			BREEZÉ TOWER				18,059
or more	55 years old,	4,959				12 years old,	13,100			(25.2%)
	3-minute walk				3-minute walk
Total
acquisition	35,211	19,222		－	13,100		3,990		71,525
price
(Overall ratio)	(49.2%)	(26.9%)			(18.3%)		(5.6%)		(100.0%)

Typical Floorplate * Office Buildings Only

400 tsubos		Less than 400 tsubos, but
or more		200 tsubos or more

Less than 200 tsubos, but		Less than 100
49
100 tsubos or more		tsubos

SANKEI REAL ESTATE Inc.

Portfolio Matrix at End of 4th Fiscal Period (2)

Area

(Unit: million yen)

Area

Central 3 wards of Tokyo

Tokyo 23 wards

Greater Tokyo

Osaka City

Other ordinance-designated cities

Total acquisition

price

(Chiyoda, Chuo, and Minato wards)

(Other than the central 3 wards of Tokyo)

(Excluding

Nagoya City

Core cities, major regional cities

(Overall ratio)

Tokyo)

Typical

Property name

floorplate

Building age, walking

Acquisition price

Building age, walking

Acquisition price

Building age, walking

Acquisition price

Building age, walking

Acquisition price

(tsubo)

time from station

(million yen)

time from station

(million yen)

time from station

(million yen)

time from station

(million yen)

Tokyo Sankei Building

Shinagawa Seaside

BREEZÉ TOWER

25,649

400 tsubos

TS Tower

or more

20 years old,

2,509

17 years old,

10,040

12 years old,

13,100

(35.9%)

1-minute walk

3-minute walk

(tsubo)

Less than

Omori Park Building

5,400

400 tsubos

300 tsubos

27 years old,

5,400

(7.6%)

or more

3-minute walk

Less than

Hatchobori Sankei Building

Toyo Park Building

Hotel Intergate Hiroshima

12,731

300 tsubos

200 tsubos

floorplate

55 years old,

4,959

29 years old,

3,782

2 years old,

3,990

(17.8%)

or more

Hibiya Sankei

9-minute walk

3-minute walk

Building

3-minute walk

S-GATE NIHONBASHI-

HONCHO

2 years old,

6,698

4-minute walk

Typical

Less than

28 years old,

4,200

25,688

200 tsubos

1-minute walk

5,829

100 tsubos

S-GATE AKASAKA

(35.9%)

or more

5 years old,

1-minute walk

Hotel Intergate Tokyo Kyobashi

3 years old,

8,961

1-minute walk

Less than

S-GATE AKIHABARA

2,055

100 tsubos

3 years old,

2,055

(2.9%)

5-minute walk

Total

acquisition

40,611

13,822

－

13,100

3,990

71,525

price

(Overall ratio)

(56.8%)

(19.3%)

(18.3%)

(5.6%)

(100.0%)

Typical Floorplate * Office Buildings Only (Construction area is used as reference value for hotels)

400 tsubos		Less than 400 tsubos, but
or more		200 tsubos or more

Less than 200 tsubos, but		Less than 100
100 tsubos or more		tsubos

SANKEI REAL ESTATE Inc.

Top End Tenants by Leased Area (as of February 28, 2021)

			% of
Name of end tenant	Business type	Total leased	portfolio's	Property name
area	total leased

		(m2)	area

GRANVISTA Hotels & Resorts Co., Ltd.

Sony Corporation

NH Foods Ltd.

Bayer Yakuhin, Ltd.

Konoike Construction Co., Ltd.

Hitachi Real Estate Partners, Ltd.

Hakuhodo DY Holdings Inc.

Toyo Sangyo Co., Ltd.

Yokogawa Solution Service Corporation

SEGA GROUP CORPORATION

Hotel

Manufacturing

Manufacturing (food)

Manufacturing

(pharmaceutical)

Construction

Real estate

Service

(advertising)

Service

(equipment maintenance)

Service

(equipment maintenance)

Manufacturing

(game)

15,166.7	23.36%
Not disclosed	Not disclosed
Not disclosed	Not disclosed
Not disclosed	Not disclosed
2,542.7	3.92%
2,423.0	3.73%
1,888.3	2.91%
1,509.7	2.33%
Not disclosed	Not disclosed
1,131.0	1.74%

Hotel Intergate Tokyo Kyobashi Hotel Intergate Hiroshima

Shinagawa Seaside TS Tower

BREEZÉ TOWER

S-GATENIHONBASHI-HONCHO

Toyo Park Building

S-GATE AKASAKA

Omori Park Building

BREEZÉ TOWER

Omori Park Building

"Total leased area" and "% of portfolio's total leased area" are based on figures after considering SANKEI REAL ESTATE's ownership interest.
"% of portfolio's total leased area" refers to the total leased area expressed as a percentage of the entire portfolio's total leased area, rounded to two decimal place.
With regard to "Total leased area" and "% of portfolio's total leased area," for properties leased to the master lessee, the areas stated in the lease agreements concluded with end tenants are used as areas leased to the end tenants when calculating.
The information is "Not disclosed" due to unavoidable circumstances in that such contains information for which consent for disclosure has not been obtained from the tenant, relevant party, etc. or information from which confidential information can be derived.

SANKEI REAL ESTATE Inc.

Status of Lease Agreements (as of February 28, 2021; based on leased area after considering ownership interest)

 Breakdown of Tenants by Contract Form	 Breakdown of Tenants by Lease Period
(including hotels)

Ordinary building
lease agreement	Less than 3 years	29.0%
32.0%	34.7%	10 years or more

		Average*1
		7.6 years
68.0%		18.0%

Fixed-term building	3 years or more, 18.3%	5 years or more,
lease agreement	but less than 5 years		but less than 10 years

Breakdown of Tenants by Business Type

Transportation &	3.0%	Other	2.9%
communications

Wholesale & retail 3.3%

IT 6.0%

Breakdown of Tenants by Lease Period (excluding hotels)

10 years or more

7.3%

Construction & real estate 9.7%	36.0%	Manufacturing	Less than	23.5%	5 years or more,
	 Sony	3 years 45.2%	but less than 10 years
			 NH Foods	Average*1
			 Bayer Yakuhin		3.8 years
			Etc.
	15.7%
	Service
 Toyo Sangyo	23.4%			24.0%
	Yokogawa Solution Service

 NEC Facilities				3 years or more,
	Etc.	Hotel  GRANVISTA Hotels & Resorts
		but less than 5 years
		(100% subsidiary of Sankei Building)

*1. Figures are the weighted average based on the area leased to each tenant.
*2. As to the calculation of each ratio indicated above, for properties leased to the master lessee, the areas stated in the lease agreements concluded with
	end tenants are used as areas leased to the end tenants when calculating.			52

SANKEI REAL ESTATE Inc.

Status of Unitholders (as of February 28, 2021)

Breakdown of Investment Units by Unitholder Type

	Financial institutions		Securities companies
	Other Japanese corporations	Non-Japanese corporations, etc.
	Individuals/Other
100%
90%	16.88%	14.68%	14.31%	13.93%


80%	11.66%	15.63%	14.52%	14.24%


70%	6.75%	4.52%	5.53%	6.25%

	1.49%	1.22%	1.14%	1.24%
60%
50%
40%
30%	63.19%	63.92%	64.48%	64.31%

20%
10%
0%
	End of 1st FP	End of 2nd FP	End of 3rd FP	End of 4th FP

Number of Unitholders by Unitholder Type

	End of 1st FP	End of 2nd FP End of 3rd FP	End of 4th FP
Financial institutions	37	55	54	49
Securities companies	17	19	23	22
Other Japanese	116	127	131	135
corporations

Non-Japanese	57	62	59	70
corporations, etc.

Individuals/Other	6,399	7,585	7,458	7,406
Total	6,626	7,848	7,725	7,682

 Major Unitholders

	Number of	Share of
Name of unitholder	units owned	units owned
	(units)	(%)
The Master Trust Bank of Japan, Ltd. (Trust Account)	72,506	20.32

Custody Bank of Japan, Ltd. (Trust Account)	67,338	18.87

The Nomura Trust and Banking Co., Ltd.	25,131	7.04
(Investment Trust Account)


The Sankei Building Co., Ltd.	17,479	4.89

Custody Bank of Japan, Ltd. (Security Investment Trust Account)	16,263	4.55

BNP PARIBAS SECURITIES SERVICES	12,683	3.55
LUXEMBOURG/JASDEC/SECURITIES-AIFM


STATE STREET BANK AND TRUST COMPANY 505223	6,505	1.82

Aozora Bank, Ltd.	6,102	1.71

SCBHK AC LIECHTENSTEINISCHE LANDESBANK AG	5,727	1.60

The Bank of Yokohama, Ltd.	5,353	1.50

Total	235,087	65.88

Each share above is rounded down to two decimal place.
53

SANKEI REAL ESTATE Inc.

Profile of the Asset Management Company

Trade name	Sankei Building Asset Management Co., Ltd.
Established	April 13, 2018
Capital	100 million yen

Shareholder composition	The Sankei Building Co., Ltd. 100%

	Investment management business, investment advisory and

Main line of business	agency business, type II financial instruments business

Directors and auditors	5 directors
1 auditor

Financial instruments	Director-General of the Kanto Local Finance Bureau Registration
business registration	(FIBO) No. 3094
Real estate brokerage	Governor of Tokyo License (1) No. 102209
license

Discretionary transaction	Minister of Land, Infrastructure, Transport and Tourism Approval
agency, etc. approval	No. 125

General Meeting of Shareholders

Auditor

Board of Directors

Investment Committee		Compliance Committee

President and CEO

Internal Audit Office

Investment Management Department

SANKEI REAL ESTATE Inc.

・Investment policy planning ・Acquisition and sale of assets

under management

・Operation and management of assets under management

Finance & IR Department

・Corporate planning, accounting and general affairs

・Financials and IR

Compliance Office

Fund Management Department

Private equity real estate funds, etc. ・Investment policy planning

・Acquisition and sale of assets under management

・Operation and management of assets under management

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Sankei Real Estate Inc. published this content on 23 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 April 2021 01:35:05 UTC.

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06-05	Sankei Real Estate Acquires First FIT Non-fossil Certificates	MT
04-15	Sankei Real Estate Inc. Provides Earnings Guidance for the Fiscal Period Ending August 2024 and February 2025	CI

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Latest news about SANKEI REAL ESTATE Inc.

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Company Profile

Income Statement Evolution

Quarterly earnings - Rate of surprise

Sector Office REITs

Sankei Real Estate Acquires First FIT Non-fossil Certificates	06-04	MT
Sankei Real Estate Inc. Provides Earnings Guidance for the Fiscal Period Ending August 2024 and February 2025	04-15	CI
SANKEI REAL ESTATE Inc. Announces Dividend for the Fiscal Period Ended February 29, 2024, Payable on May 24, 2024; Provides Distribution Guidance for the Fiscal Period Ending August 31, 2024 and Fiscal Period Ending February 28, 2025	04-15	CI
SANKEI REAL ESTATE Inc. Announces Execution of A Line of Credit Loan Master Agreement (Uncommitted)	04-12	CI
Sanki Real Estate Fixes Interest Rate on 3.3 Billion Yen Syndicated Loan	03-11	MT
SANKEI REAL ESTATE Inc. completed the acquisition of VESSEL HOTEL CAMPANA SUSUKINO from The Sankei Building Co., Ltd.	02-29	CI
Sanki Real Estate Obtains 3.3 Billion Yen Syndicated Loan	02-29	MT
SANKEI REAL ESTATE Inc. agreed to acquire 49% stake in S-GATE NIHONBASHI-HONCHO for ¥7.5 billion.	02-28	CI
SANKEI REAL ESTATE Inc. agreed to acquire VESSEL HOTEL CAMPANA SUSUKINO from The Sankei Building Co., Ltd. for ¥2.9 billion.	02-28	CI
SANKEI REAL ESTATE Inc. Announces Partial Refinancing of Its Existing Loans	02-28	CI
Sankei Real Estate to Sell Japan Office Properties for 34 Billion Yen	01-30	MT
SANKEI REAL ESTATE Inc. Announces Acquisition Assets	01-30	CI
SANKEI REAL ESTATE Inc. Reports Earnings Results for the Full Year Ended August 31, 2023	23-10-16	CI
SANKEI REAL ESTATE Inc. Provides Earnings Guidance for the Fiscal Period Ending February 29, 2024 and Fiscal Period Ending August 31, 2024	23-10-16	CI
The Sankei Building Co., Ltd. Announces Revival Plan & Granting of Negotiation Rights for Sale & Acquisition of Domestic Real Estate Trust Beneficiary Rights	23-10-16	CI
Sankei Real Estate Inc. Announces Distribution for the Fiscal Year Ended August 31, 2023, Payable on November 22, 2023	23-10-16	CI
The Sankei Building Co., Ltd. acquired 1.55% stake in BREEZÉ TOWER from SANKEI REAL ESTATE Inc. for ¥620 million.	23-08-30	CI
The Sankei Building Co., Ltd. agreed to acquire 1.55% stake in BREEZÉ TOWER from SANKEI REAL ESTATE Inc. for ¥620 million.	23-08-28	CI
Sankei Real Estate to Borrow 5.9 Billion Yen	23-08-25	MT
Sankei Real Estate Inc. Announces Notice Concerning Borrowing of Funds (Refinancing)	23-08-24	CI
SANKEI REAL ESTATE Inc. Announces Notice Concerning Execution of a Line of Credit Loan Master Agreement (Uncommitted)	23-04-28	CI
SANKEI REAL ESTATE Inc. Reports Earnings Results for the Second Half Year Ended February 28, 2023	23-04-14	CI
Sankei Real Estate Inc. Announces the Earnings Forecast for the Period Ended August 2023 and February 2024	23-04-14	CI
Sankei Real Estate Inc. Announces Dividend for the Fiscal Period Ended February 2023, Payable on May 25, 2023	23-04-14	CI
SANKEI REAL ESTATE Inc. Announces Management Changes	23-03-28	CI

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SANKEI REAL ESTATE INC.	-9.13%	241M
BOSTON PROPERTIES, INC.	-14.07%	9.66B
NIPPON BUILDING FUND INC.	-8.67%	5.94B
DEXUS	-16.80%	4.65B
JAPAN REAL ESTATE INVESTMENT CORPORATION	-13.36%	4.48B
EMBASSY OFFICE PARKS REIT	+9.97%	4.06B
KDX REALTY INVESTMENT CORPORATION	-4.23%	3.92B
KILROY REALTY CORPORATION	-21.59%	3.8B
SL GREEN REALTY CORP.	+21.76%	3.66B
INMOBILIARIA COLONIAL SOCIMI, S.A.	-13.05%	3.21B