United Urban Investment : Notice Concerning Issuance of Sustainability Bonds

For Translation Purposes Only

October 21, 2021

For Immediate Release

United Urban Investment Corporation

Toshiaki Emon

Executive Officer

(Securities Code: 8960)

Asset Management Company:

Japan REIT Advisors Co., Ltd.

Norimasa Gaun

President and CEO

Inquiries:

Takehide Sasaki

Chief Financial Officer

TEL: [phone]

Notice Concerning Issuance of Sustainability Bonds

United Urban Investment Corporation ("United Urban") hereby announces its decision today to issue sustainability bonds (the "Issuance"), as set forth below.

1. Summary of Sustainability Bonds

United Urban Investment Corporation Series 22 of Unsecured Corporate Bonds (with pari passu conditions among corporate bonds) (Sustainability Bonds) (the "Sustainability Bonds")

1. Total amount of corporate bonds to be issued
2. Form of bond certificate
3. Issue price
4. Redemption price
5. Interest rate
6. Unit of each bond
7. Offering method
8. Subscription date
9. Closing date
10. Collateral
11. Redemption method and date
12. Interest payment dates
13. Financial covenants
14. Rating
15. Financial, Issuing and paying agent

• ¥3.5 billion
• No bond certificates for the Sustainability Bonds will be issued under the Act on Book-entry Transfer of Bonds, Shares, etc.
• ¥100 per ¥100 of the corporate bond
• ¥100 per ¥100 of the corporate bond
• 0.400% per annum
• ¥100 million
• Public offering
• October 21, 2021 (Thursday)
• October 28, 2021 (Thursday)
• There is no collateral or guarantee on the Sustainability Bonds. There are no assets reserved as security for the Sustainability Bonds.
• The total amount of the corporate bonds will be redeemed on October 28, 2031 (Tuesday).
• • The Sustainability Bonds may be repurchased and cancelled at any time from the date following the closing date unless otherwise specified by Japan Securities Depository Center, Incorporated, a depositary trust company.
• April 28 and October 28 of each year (or if such interest payment date falls on a day which is not a bank business day, the payment will be brought forward on the immediately preceding bank business day)
• "Negative Pledge Clause" and "Clause for Transformation from Unsecured to Secured Status" are applicable.
• AA: Japan Credit Rating Agency, Ltd.
• Sumitomo Mitsui Trust Bank, Limited

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(16) Underwriters	: SMBC Nikko Securities Inc.
	Daiwa Securities Co. Ltd.

The Sustainability Bonds are rated as "SU 1", the highest evaluation in "JCR Sustainability Bond Evaluation" (Note) by Japan Credit Rating Agency, Ltd. ("JCR").

(Note) For details of JCR Sustainability Bond Evaluation, please refer to the website of Japan Credit Rating Agency, Ltd. (https://www.jcr.co.jp/en/).

2. Reason for the Issuance

United Urban has been taking a holistic approach to practice the asset management in consideration of ESG (Environment, Social, and Governance) and pursue solid and resilient management that coexists with environment and society. As part of ESG financing, United Urban decided the Issuance with an aim to tap into and expand the ESG investors base as well as to further diversify financing methods.

The Sustainability Bonds are corporate bonds that will be used for acquisition of the existing and/or new "Eligible Green Assets" (Note) or "Eligible Social Assets" (Note), or repayment of the existing debts that have already been used for acquisition of the Eligible Green Assets or Eligible Social Assets. Specifically, United Urban plans to use the funds for: (i) redemption funds for the 15th unsecured investment corporation bonds issued by United Urban as repayment funds for borrowings required for the acquisition of eligible green assets,

1. cash on hand decreased due to the acquisition of eligible social assets and (iii) funds required for development.

	Name of Eligible Green Assets		Environmental Certification		Acquisition Date
	Pacific Marks Yokohama East		CASBEE for Real Estate		April 17, 2019
		(S rank)		(reacquire the certification)
	Name of Eligible Social Assets		Social Project
	Miyanomori Nijo Development Site		Access to essential services
	(Elderly housing)		Socio-economic improvement and empowerment

(Note) Eligible Green Assets are assets that meet green qualified criteria. Eligible Social Assets are assets that meet the social qualified criteria. For the details of the Eligible Green Assets and the Eligible Social Assets, please refer to the press release "Notice Concerning Filing of Amendment to Shelf Registration Statement for Sustainability Bonds Issuance" dated October 4, 2021.

3. Total Amount and Use of Proceeds, and Scheduled Period of Expenditure

1. Total amount of proceeds to be received (approximate net balance) ¥3,467 million
2. Use of proceeds and scheduled period of expenditure
   United Urban plans to use the funds for: (i) redemption funds for the 15th unsecured investment corporate bonds due on October 29, 2021 (¥3,000 million), (ii) cash on hand decreased due to acquisition of equivalent to 80% of "Miyanomori Nijo Development Site" (the "Development Site")
   (Note) on September 30, 2021 (¥296 million), (iii) payment of acquisition of equivalent to the remaining 20% of the Development Site by the end of March 2022 (¥74 million) and (iv) first payment of building construction cost of "Miyanomori Nijo Development Project" (Note) on April 2022 (¥100 million).

The funds raised will be managed in cash or cash equivalents until the funds are used for the above purposes.

(Note) For details of acquisition of the Development Site and Development Project, please refer to the press release "Notice Concerning Acquisition and Agreements Concerning Development Project (Miyanomori Nijo Development Project)" dated July 15, 2021.

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4. Investors expressing investment in the Sustainability Bonds

As of today, we have listed the investors who have expressed their intention to invest in the Sustainability Bonds. (order of the Japanese syllabary)

・Mutual Aid Foundation for Japan Postal Group ・The 77 Bank, Ltd.

・The Yamanashi Chuo Bank, Ltd. ・The Kita Osaka Shinkin Bank

・THE KOSAN SHINKIN BANK ・The SAGAMI Shinkin Bank

・SHIZUOKA YAIZU SHINKIN BANK ・DaitokyoShinkumi Credit Cooperative

・TOKUSHIMA SHINKIN BANK ・Nishihyogo Shinkin Bank

5. Balance of Borrowings and Other Interest-Bearing Liabilities after the Issuance of the Corporate

Bonds (Note 1)

				(Millions of yen)
		Before	After	Changes
		the Issuance	the Issuance
	Short-term borrowing (Note 2)	-	-	-
	Long-term borrowing (Note 3)	267,933	267,933	-
	Total borrowings	267,933	267,933	-
	Corporate bonds (Note 4)	36,000	36,500	+500
	Total of interest-bearing liabilities	303,933	304,433	+500

(Notes)

1. The above table shows the expected balance of the borrowings and other interest-bearing liabilities as of October 29, 2021, which is after the redemption of the 15th unsecured investment corporate bonds. Amounts are rounded down to the nearest million yen. Accordingly, additions or subtractions of the entered interest-bearing liabilities amounts do not necessarily equal the total amount or the amounts of any increase or decrease.
2. "Short-termborrowing" means a borrowing lasting within one year from the drawdown date to repayment date.
3. "Long-termborrowing" (including debt financing by joint money trust (UUR Green Trust)) means a borrowing lasting over one year from the drawdown date to the repayment date and includes long-term borrowings to be repaid within one year.
4. "Corporate bonds" include Green bonds and Sustainability bonds.

6. Other Matters Required for Investors to Understand and Evaluate the Above Information Appropriately

For the risks concerning the issuance and the redemption of the Corporate Bonds, there are no significant changes in "Risks concerning Borrowings and Corporate Bonds" of "Investment Risks" described in the thirty-fifth fiscal period securities report (filed on August 31, 2021).

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