NIPPON REIT Investment Corporation (TSE code：3296)

Pe r f o r m a n c e Re p o r t ( A p r i l - J u n e 2 0 2 2 )

August 16, 2022

NIPPON VISION

Serious, Steady, Solid.

Note 1.

Occupancy Rate and Rent-free Period Trend

  • Both contract and rent occupancy rate show stable trend
    • Portfolio occupancy rate continues to be stable
    • Rent occupancy remains low compared to the contract occupancy rate due to the leasing promotion of granting longer free rent period. The average free rent period has reached its peak and remained flat

《 Occupancy rate trend and forecast 》

《Trend of occupancy rate based on rent (office)》

100.0%

95.0%

90.0%

85.0%

Total

（actual）

Total

（forecast）

Office

（actual）

Office

（forecast）

Residential (actual）

Residential (forecast）

Retail

（actual）

Retail

（forecast）

80.0%

16th

17th

18th

19th

20th

21st

22nd

period

period

period

period

period

period

period

98.6%

97.6%

97.8%

98.1％

98.0％

97.7％

97.7％

Total

99.3%

98.5%

98.1%

98.6%

98.3％

98.3％

98.1％

Office

97.6%

95.8%

97.1%

97.3％

97.5％

96.8％

96.9％

Residen

-tial

92.2%

95.4%

97.8%

97.7%

100.0%

97.5%

100.0%

Retail

Based on contract (office/actual)

Based on contract（office/forecast）

Based on rent

(office/actual)

Based on rent

（office/forecast）

99.3%

98.6%

100.0%

98.5%

98.3%

98.3% 98.1%

98.1%

98.9%

95.8%

96.1%

96.2%

95.0%

95.3%

95.0%

94.3%

90.0%

1

16th

7

17th

13

18th

19

19th

25

20th

31

21st

37

22nd

period

period

period

period

period

period

period

Jun. 2020

Dec. 2020

Jun. 2021

Dec. 2021

Jun. 2022

Dec. 2022

Jun. 2023

《Trend of average free rent period（1）》

5month

4month

2.9month

2.9month

3month

2.0month

1.5month

2month

0.8month

1month

0month

16th period

17th period

18th period

19th period

20th period

（Jun. 2020）

（Dec. 2020）

（Jun. 2021）

（Dec. 2021）

（Jun. 2022）

"Average free rent period" is calculated by following formula for each space, for new lease contracts conducted during respective period.

(Reduction of rent and common benefit expense due to free rent etc.) ÷ (total amount of monthly rents and common benefit expenses in normal times)

1

Rent Increase/Decrease Upon Tenant Replacement and Status of Rent Renewal

  • While the rent change ratio upon tenant replacement continues to be affected by the spread of COVID-19, there were slight improvement in the 20th Period
    • For the office properties, the rate of decrease in rent at the time of tenant replacement has narrowed, and there was also a recovery in rent increase ratio for contract renewals. The rate of change in rent for residential properties at the time of tenant replacement showed moderate recovery

《 Monthly rent increase (decrease) upon tenant replacement》

《Trend of record of rent renewals ( floor space)(3) (Office)》

Subject to

●Office

Subject to

Negotiation

Rent change ratio (1)

Total rent increase

Total rent decrease

①

Negotiation

10,000

26.2%

25.8%

28%

②

①

②

③

7,500

21%

19th period

①

20th period

5,000

9,188

14%

129 tenants

121 tenants

7,015

5,154

11,512 tsubo

11,652 tsubo

2,500

7%

747

0

1.3%

1,840

0%

▲ 6.4%

④

④

▲ 2,500

0

0

▲ 4,394

▲ 1.7%

▲7%

▲ 2,559

▲ 3,302

Space (tsubo)

Ratio

Space (tsubo)

Ratio

▲ 5,000

▲14%

16th period 17th period 18th period 19th period 20th period

① Increase

319

2.8%

1,017

8.7%

（Jun. 2020）

（Dec. 2020）

（Jun. 2021）

（Dec. 2021）

（Jun. 2022）

② No Change

1,501

13.0%

620

5.3%

Net total

9,188

7,015

759

▲2,554

▲719

0

0.0%

120

1.0%

(¥.000/month)

③ Decrease

●Residence(2)

④ Not negotiated

9,691

84.2%

9,894

84.9%

(¥.000/month)

Total rent increase

Total rent decrease

Rent change ratio(1)

《Status of rent increase (decrease) upon contract renewals》(office /monthly rent) 》

5.8%

Rent increase ratio(4)

1,500

6%

Total rent increase

Total rent decrease

12,000

12.0%

Rent increase ratio

1,000

3.1%

4%

10,500

10.5%

upon contract

958

500

1,401

676

938

2%

9,000

7.1%

renewals

7.5%

9.0%

600

0.6%

1.9%

7,500

6.0%

7.5%

1.2%

4.8%

0

0%

6,000

5.2%

6.0%

10,940

▲ 34

▲ 151

▲ 765

▲ 371

▲ 265

4,500

4.5%

▲ 500

▲ 2%

3,000

3.0%

▲ 1,000

▲ 4%

1,500

2,082

297

763

1.5%

16th period 17th period 18th period 19th period 20th period

0

886

0.0%

（Jun. 2020）

（Dec. 2020）

（Jun. 2021）

（Dec. 2021）

（Jun. 2022）

0

0

0

0

▲ 240

Net total

566

1,250

192

305

672

▲ 1,500

▲ 1.5%

(¥.000/month)

16th period

17th period

18th period

19th period

20th period

note

(¥,000/month)

1."Rent change ratio" is calculated in each period as follow, rounded to the first decimal place.

(Jun. 2020)

(Dec. 2020)

(Jun. 2021)

(Dec. 2021)

(Jun. 2022)

((total rent after tenant replace - total rent before tenant replacement )/ total rent before tenant replacement)

2.Residential properties of which rents are not fixed, are stated.

3. In case that tenant categorized "Unchanged" in each period accepted rent increase after the following period, the area subject to rent renewal of the tenant is included the area categorized "Unchanged" and "Increase" in the relevant period.

4. "Rent increase ratio" is calculated in each period as below, rounded to the first decimal place. ((total rent increase after rent renewal - total rent before rent renewal )/ total rent before rent renewal)

2

Status of cancellation notices

Property name

Occupan-

Status of cancellation notice

cy rate

Assumed

occupancy rate(1)

Property name

Occupan-

Status of cancellation notice

cy rate

Assumed

occupancy rate(1)

Itohpia Iwamotocho

100.0%

1 space (73 tsubo)

Cancellation

2-chome Building

notice

FORECAST Shin-

100.0%

2 floors (90 tsubo)

Cancellation

Tokiwabashi

notice

BECOME SAKAE

100.0%

1 space (51 tsubo)

Cancellation

notice

FORECAST Mita

78.5%

1 floor (116 tsubo)

Vacant

Towa Higahi-

100.0%

1 space (72 tsubo)

Cancellation

Gotanda Building

notice

Sannomiya First

100.0% 2 spaces (38 tsubo)

Cancellation

Building

notice

TK Gotanda Building

100.0%

2 floors (203 tsubo)

Cancellation

notice

FORECAST

100.0%

1 floor (64 tsubo)

Cancellation

Nishishinjuku

notice

NORE Fushimi

100.0%

1 space (34 tsubo)

Cancellation

notice

Nishi-Shinjuku

83.5% 1 space (123 tsubo)

Vacant

Sanko Building

FORECAST

1 floor (72 tsubo)

Vacant

Ningyocho PLACE

87.1%

1 floor (72 tsubo)

Cancellation

notice

FORECAST Kameido

100.0%

1 space (49 tsubo)

Cancellation

notice

NORE Meieki

94.7%

1 space (68 tsubo)

Vacant

1 space (15 tsubo)

Cancellation

notice

Omiya Center

94.8%

3 spaces (223 tsubo) Vacant

Building

1 space (60 tsubo)

Cancellation

notice

100.0% (Aug. 2022)

100.0% (Aug. 2022)

100.0% (Aug. 2022)

100.0% (Sep. 2022)

100.0% (Sep. 2022)

100.0% (Sep. 2022)

100.0% (Sep. 2022)

100.0% (Oct. 2022)

100.0% (Oct. 2022)

100.0% (Nov. 2022)

100.0% (Dec. 2022)

94.7% (Jan. 2023)

93.5% (Dec. 2022)

93.4% (Sep. 2022)

Kanda Ocean Building

REID-C Iidabashi

Building

FORECAST Yotsuya

GreenOak Kudan

Gotanda Sakura

Building

Otakibashi Pacifica Building

NRT Kandasudacho Building

The Square

Nishi-Gotanda8-chome Building

Hiroo ON Building

ANTEX24 Building

La Verite AKASAKA

FORECAST

Takadanobaba

GreenOak Takanawadai

100.0%

1 floor (43 tsubo)

Cancellation

2 spaces (12 tsubo)

notice

100.0%

1 floor (23 tsubo)

Cancellation

notice

100.0%

1 floor (52 tsubo)

Cancellation

notice

100.0% 4 floors (408 tsubo) Cancellationnotice

100.0%

1 floor (48 tsubo)

Cancellation

notice

100.0%

1 floor (44 tsubo)

Cancellation

notice

100.0%

1 floor (39 tsubo)

Cancellation

notice

100.0% 2 spaces (53 tsubo)

Cancellation

notice

Cancellation

100.0%

1 floor (109 tsubo) notice

100.0%

1 floor (86 tsubo)

Cancellation

notice

86.7%

1 floor (90 tsubo)

Vacant

100.0%

1 floor (69 tsubo)

Cancellation

notice

100.0%

1 floor (277 tsubo) Cancellation

notice

1 floor (58 tsubo)

Vacant

92.7%

1 floor (89 tsubo)

Cancellation

notice

90.2% (Dec. 2022)

90.0% (Sep. 2022)

89.7% (Jan. 2023)

89.4% (Jan. 2023)

89.3% (Oct. 2022)

89.3% (Dec. 2022)

88.8% (Dec. 2022)

88.4% (Jan. 2023)

87.9% (Feb. 2023)

87.3% (Nov. 2022)

86.7% (Jul. 2022)

86.6% (Feb. 2023)

83.8% (Aug. 2022)

81.4% (Jan. 2023)

FORECAST Shinjuku

1 space (164 tsubo) Cancellation

SOUTH

96.8%

1 space (135 tsubo) notice

Vacant

MK Kojimachi

100.0%

1 floor (50 tsubo)

Cancellation

Building

notice

Toranomon Sakura

100.0%

1 space (84 tsubo)

Cancellation

Building

notice

92.9% (Apr. 2023)

90.7% (Jan. 2023)

90.8% (Nov. 2022)

FORECAST Sakurabashi

100.0%

1 space (118 tsubo) Cancellation

1 floor (305 tsubo) notice

Vacant

FORECAST Shinagawa

84.2%

1 floor (108 tsubo) Cancellation

1 space (70 tsubo) notice

Cancellation

Shinto GINZA EAST

100.0%

3 floors (140 tsubo) notice

78.7% (Mar. 2023)

74.0% (Oct. 2022)

61.8% (Dec. 2022)

Properties of which occupancy rate is expected to be 100% because new lease contracts have been concluded or we have already received tenancy applications for subject area 1. Assumed occupancy rate refers to the occupancy rate after the realization of all tenancy applications and cancellation notices at the end of July 2022.

3

Implementation Status and Major plans of Engineering Management

  • Engineering Management, another driver of internal growth, is carried out in a well-planned manner

《Implemented Measures (from Apr. to Jun. 2022)》

《FORECAST Shinjuku SOUTH》

Increase in revenue by replacing operator of coin- operated parking space

  • Approx.¥6.21mm p.a. revenue increase is expected by replacing parking company

《Planned Measures (Jul. 2022 ~)》

●●

《Toranomon Sakura Building and 2 properties》

●●

●●

Increase in revenue by setting antennas for cell phone

●

carriers

●

•

Revenue increase is expected by setting antennas on the rooftop for

cell phone carriers

《Tower Court Kitashinagawa and

4 properties》

●●

Increase in revenue by setting antennas for cell phone

●●

carriers

  • Approx. ¥3.97mm p.a. revenue increase is expected by setting antennas for mobile phone and by negotiation on rent increase

《Tower Court Kitashinagawa》

●●

Increase in revenue by Reduction of building

●●

maintenance fee through installation of Daleman Shock

  • Approx.¥1.4mm p.a. revenue increase is expected by reducing building maintenance fee by installing a device that protects pipes

《Field Avenue and 3 properties》

●●

●●

Reduce cost by installation of LED lighting in the common

areas

•

Approx.¥0.99mm p.a. cost reduction and reduction of CO2 emissions ●

are expected by installation of LED lighting in common areas

Measure to increase revenue

Measure to improve tenant satisfaction

Measure to reduce expense

Measure with environmental consideration

《Primegate Iidabashi and 5 properties》

●●

Increase in revenue by subleasing of unused parking

●●

space

  • Revenue increase is expected by additionally subleasing unused parking space and replacement of sublessee

《FORECAST Ningyocho PLACE and The Square》

●●

Conducting large scale maintenance that includes

●●

upgrading of air conditioners and switch to LED lighting

  • Reduce CO2 emissions and electricity cost by upgrade of air conditioning system and switching to LED lighting

《 Primegate Iidabashi》

●●

Renovation work on the 148.58 m2 residential unit

●●

  • Expecting to increase rent by conducting a large-scale renovation on● the 1st floor unit after tenant's move-out

《Status of Engineering Management Implementation for the 20th Period(1)》

600

75

300

18

45

363

83

270

26

21

0

(¥mm)

Jan.

Feb.

Mar.

Apr.

May

Jun.

20th period

Budget

total

1. Total amounts of Planned capital investment and Strategic value-enhancing investment are stated. Furthermore, the figures may change when accounting items will be determined.

4

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Nippon REIT Investment Corporation published this content on 16 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 August 2022 15:53:36 UTC.