United Urban Investment : Presentation Material(5.1MB)

39th Fiscal Period

Six months ended May 2023

Presentation Material

Securities Code: 8960

https://www.united-reit.co.jp/en/

July 2023

39th FP ('23/5) Presentation Material | Business Results & Forecast

Table of Contents

Mid-term Asset Management Policy	p.2
Executive Summary
	● 39th FP Business Results / 40th FP & 41st FP Forecast	p.3
	● DPU Composition: 39th FP	p.5
	● DPU Composition: 40th FP & 41st FP	p.6
External Growth
	● Property Acquisition: 39th FP & 40th FP	p.7
	● Property Acquisition: 39th FP (Development Project)	p.8
	● Asset Replacement: 39th FP - 41st FP	p.9
Internal Growth
	● Portfolio's Condition: Occupancy Rate	p.10
	● Portfolio's Condition: Rental Revenues / Yield	p.11
	● Hotels	p.13
	● Office buildings	p.15
	● Retail properties	p.17
	● Others (Logistics facilities)	p.18
	● Residential properties	p.19
Financial Management	p.20
ESG Initiatives	p.21

Appendix

United Urban Investment Corporation (UUR)	p.26
Structure of United Urban and Management System at Asset Management Company	p.27
Collaboration with Marubeni Group	p.28
Mid-term Initiatives		p.29
Portfolio Summary	● Track Record of External Growth	p.31
	● Overview	p.32
	● Rental Revenues	p.33
	● Yield	p.34
Distribution / NAV per Unit		p.35
Book Value / Appraisal Value		p.36
Overview of Unitholders		p.37
Financial Indices		p.38
Financial Results	● 39th FP	p.39
Business Forecast	● 40th FP & 41st FP	p.40
External Growth	● Acquisition: 39th FP	p.41
	● Acquisition: 40th FP	p.43
Internal Growth	● Asset Management: Hotels	p.45
	● Asset Management: Office buildings	p.46
	● Asset Management: Retail properties	p.48
	● Monthly Rent Changes at Existing Properties	p.49
Financial Standing		p.50
Policy of Retained Earnings Utilization	p.51
ESG Initiatives		p.52
	● Environment	p.55
	● Society	p.57
	● Governance	p.59
Property Income and Occupancy		p.60
Appraisal Value		p.65
Properties		p.69
Definition		p.73

1

Please also see p.29 and 30 of Appendix.

Mid-term Asset Management Policy

For Further Growth of United Urban

Steady external growth by leveraging the strengthen of the diversified

REIT and investing in the best asset type at the best time

Promote to make the portfolio more robust through asset replacements; continue to increase the AUM and enhance the profitability

Reap the upside from recovery and progress of the hotel performance after the pandemic

• Setting DPU ¥3,400 as a base, pursue stable cash distribution by using ample unrealized gain and retained earnings accordingly

2

Executive Summary | 39th FP Business Results / 40th FP & 41st FP Forecast

Please also see p.39, 40 and 51 of Appendix.

Move Forward to Extended DPU Growth

• 39th FP Operating revenues: Plus ¥0.61 Bn from 38th FP results by recovery of hotel, rent increase in office buildings and acquisition of new properties.
• Net income: As a result of intensive cost control, positive profit to be forecast after 39th FP and onward.
• DPU: Pursue sustainable growth through strategic external growth and solid internal growth of each asset type.

									(¥ Bn)
		39th FP			40th FP			41st FP
		(May 2023)			(November 2023)		(May 2024)
	Results	From	From		Forecasts	From		Forecasts	From
	Forecasts	38th FP		39th FP		40th FP
Operating revenues	25.05	+0.43	+0.61	25.30	+0.25	25.27	-0.03
Revenues from rental activities	25.05	+0.43	+1.06	24.99	-0.05	25.27	+0.27
Gain on sale of properties	－	－	-0.44		0.31	+0.31		－	-0.31
Operating income	10.90	+0.59	+0.27	11.22	+0.31	11.56	+0.34
Profit from rental activities	13.27	+0.58	+0.75	13.36	+0.08	13.99	+0.63
Net income	9.92	+0.62	+0.26	10.14	+0.21	10.45	+0.30

Retained earnings*

DPU

9.90

¥3,229	+¥75	+¥85	¥3,300	+¥71	¥3,400	+¥100

*As of the end of the 39th FP. Each amount shows amount after increasing or decreasing of reserve retained for distribution and reserve for reduction entry based on "Statements of Cash Distribution".

3

Executive Summary | 39th FP Business Results / 40th FP & 41st FP Forecast

Please also see p.35 of Appendix.

Keep DPU Growth Momentum and Operate to Grow Further

• The 39th FP actual profit turns positive from both initial forecast and the 38th FP results by solid internal and external growth.
• Accomplish mid-term target DPU over ¥3,200*1 a year earlier without using retained earnings.
• Foresee DPU ¥3,400 in the 41st FP (+5.3% from the 39th FP) only with actual profit by keeping DPU growth momentum.

DPU (¥ per unit)

■ (1) Retained earnings

■ (2) Cash distribution from temporary factors*2

■ (3) Distribution excluding ((1) and (2) = Actual Profit*3)

+¥71

+¥100

3,300

3,400

+¥85

3,144

160

2,984

3,229

3,154 58

126

11

3,171

3,017	From 38th	FP
+¥187

110

3,164

134

9

3,190

From 39th FP

+¥19

3,021

3,400

From 40th FP

+¥210

		38FP	39FP	39FP	40FP	40FP	41FP
		('22/11)	('23/5)	('23/5)	('23/11)	('23/11)	('24/5)
		Results	Initial	Results	Initial	Forecast	Forecast
			Forecast		Forecast
*1	See page 4, Presentation Material for the 38th FP (November 2022).
*2	Amount of appropriation from the gain on sale to cash distribution, cancellation penalty from tenant.
*3	Actual profit includes ¥25 of reserve for temporary different adjustment based on "Ordinance on Accountings of Investment Corporations" and "Regulations Concerning Real Estate Investment	4
	Trusts and Real Estate Investment Corporations" stipulated by the Investment Trusts Association, Japan.