#1Think bold today for a brighter tomorrow. MC-UBS GROUP MCUBS MidCity http://www.midcity-reit.com/en/ 23 rd Period Fiscal Period ended December, 2017 INVESTOR PRESENTATION -Appendix- Securities Code 3227 MCUBS MidCity Investment Corporation#2Index 456 1. FINANCIAL HIGHLIGHTS • • Overview of financial results for the fiscal period ended December 31, 2017 (23rd Period) 23rd Period financial results - Comparison to previous period 23rd Period financial results - Comparison to initial forecasts Breakdown of change from previous period • 23rd Period financial results - • Balance sheet . Income statement 7 9 681 * Fractions of the stated amounts are cut off and those of the ratios and years are rounded off unless otherwise indicated. Therefore, the aggregation of the figures stated hereupon are not necessarily identical to the total. • Portfolio overview Office in Tokyo area 3 35 • Portfolio overview Office in Osaka area 1 Portfolio overview Office in Osaka area 2 • Portfolio overview Office in Osaka, others and TK interest • Portfolio overview - Other than the office 39 • Newly acquired assets 40 333334 36 37 38 5. FINANCING STRATEGY 2. FORECASTS FOR THE 24TH AND 25TH FISCAL PERIOD • Forecasts for the 24th and 25th fiscal period • Breakdown of change from previous period 3. RESULTS FOR THE 23RD FISCAL PERIOD • Occupancy Portfolio operation 14 15 • Occupancy by property 16 • Revisions and gaps in rents 17 • Surveys on tenants' satisfaction 18 • • Initiatives in Properties in the Portfolio 19 • 4. PORTFOLIO • Office market data 5 (Nagoya) . Portfolio profitability 22 • Office market data 6 (Nagoya) • Major financing- • related figures and investment corporation bonds Financial status 45 46 11 12 • . Lender composition and maturity ladder (as of end of Dec. 2017) Outstanding borrowings (as of end of Dec. 2017) 47 48 Lender composition and maturity ladder (Estimate for Mar. 2018) Outstanding borrowings (Estimate for Mar. 2018) 49 50 6. MARKET ENVIRONMENT . Office market data 1 (Tokyo 23 districts) • Office market data 2 (Tokyo 23 districts) Office market data 3 (Osaka) Office market data 4 (Osaka) SSSSSS 53 54 55 56 57 58 • Portfolio overview (as of end of Dec. 2017/ 20 properties base) 23 7. OVERVIEW OF MCUBS MIDCITY • Portfolio overview (after acquisitions of new assets / 23 properties base) 24 • • Portfolio data 1 25 Overview of MCUBS MidCity Investment Corporation • Characteristics of MCUBS MidCity Investment Corporation • Portfolio data 2 26 . Revenue and expenses by property 1 (fiscal period ended Dec. 31, 2017) 27 Medium-term portfolio strategy • • Revenue and expenses by property 2 (fiscal period ended Dec. 31, 2017) 28 Advantage of various property information networks . • Appraisal values by property Selective acquisitions by leveraging sponsor's expertise 29 • . Unrealized gain/loss Initiatives for sustainability 30 • Establishment of Disclosure Regime • Portfolio overview - Tokyo area 31 . Overseas Property Investment • Portfolio overview - Osaka area, Nagoya area and others 32 Unitholder details • Portfolio overview - Office in Tokyo area 1 33 • Portfolio overview - Office in Tokyo area 2 34 Overview of asset management company • Historical unit price 1220328 60 61 62 63 64 65 66 67 68 69 70 MCUBS MidCity Investment Corporation 2#33 1. FINANCIAL HIGHLIGHTS MCUBS MidCity Investment Corporation#4Overview of financial results for the fiscal period ended December 31, 2017 (23rd Period) Distribution per unit Occupancy rate Fiscal Period ended Jun. 30, Fiscal Period ended Dec. 31, 2017 (22nd Period) (181 days) 2017 (23rd Period) (184 days) 7,900 yen 97.5% 8,110 yen 97.0% Compared to the 22nd Period +210 yen -0.5pt No. of properties under 20 20 management Asset size (Note 1) 238,144 mn. yen 238,144 mn. yen NOI (Note 2) 4,715 mn. yen 4,850 mn. yen +134 mn. yen Average NOI yield (Note 2) 4.2% 4.1% -0.1pt (Annual base) Interest-bearing debt 104,975 mn. yen 104,975 mn. yen LTV (Book value base)(N (Note 3) 42.2% 42.2% LTV (Appraisal value base) (No (Note 4) 43.0% 42.1% Average remaining years of debt 3.1 years 4 Issuer rating NAV per unit (Note 5) Note 1: "Asset size" is based on acquisition price. Note 2: "NOI" and "Average NOI yield" do not include dividends receivable of Nagoya Lucent Tower's silent partnership interest (hereinafter referred to as TK interest). Note 3: LTV (Book value base)=Term-end debt/term-end total assets Note 4: LTV (Appraisal value base)=term-end debt/(term-end total assets±unrealized gain/loss. Unrealized gain/loss means gap between book value and appraisal value). Note 5: NAV per unit: [Total interest + (Term-end appraisal value - term-end book value)]/term-end outstanding # of units A (Stable) 405,439 yen 3.5 years A (Stable) 423,305 yen -0.9pt +0.4 years +17,866 yen - MCUBS MidCity Investment Corporation#523rd Period financial results - Comparison to previous period (Unit: mn. yen) Fiscal period ended Jun. 30, Fiscal period ended Dec. 31, Operating revenue Rent revenue -414 137 Difference 2017 2017 (23rd (22nd Period) Period) Operating revenue Four properties acquired in 22nd Period Two properties disposed in 22nd Period Office in Tokyo Area 261 -144 49 8,025 7,610 -414 (mn. yen) Operating expenses 4,875 4,627 -247 (mn. yen) Office in Osaka Area Others Other lease business revenue Utilities revenue -28 0 -25 8 Operating income (mn. yen) 3,150 2,983 -167 Other rent revenue 2 Other operating revenue -35 Gain on distribution of TK interest (Nagoya Ordinary income (mn. yen) 2,527 2,400 -126 31 Lucent Tower) Income before income taxes Gains on sales of property -557 2,527 2,406 -121 (mn. yen) Operating expenses -247 Expenses related to rent business (excl. -22 Net income (mn. yen) 2,527 2,405 -121 depreciation and loss on retirement) Breakdown by property type Reserve for reduction entry 183 - -183 Four properties acquired in 22nd Period Two properties disposed in 22nd Period -94 (mn. yen) Office in Tokyo Area Office in Osaka Area Total distributions (mn. yen) 2,343 2,405 +62 Others -66 Breakdown by items Distribution per unit (yen) 7,900 8,110 +210 Taxes on property, plant and equipment -49 Gain/loss on real estate Utilities expenses 3,436 3,593 +157 lease business (mn. yen) Repair expenses -51 Others 22776 7257 -1 47 90 -11 NOI (mn. yen) 4,715 4,850 +134 Depreciation and loss on retirement -22 Losses on sales of property -225 Occupancy rate at end of 97.5% 97.0% -0.5pt Asset management fees 39 _period Other operating expenses -15 5 MCUBS MidCity Investment Corporation#623rd Period financial results - Comparison to initial forecasts (Unit: mn. yen) -4 Fiscal period ended Dec. 31, Fiscal period ended Dec. 31, 2017 Difference 2017 (23rd Period) (23rd Period) 8/15 Forecast Operating revenue 7,615 7,610 -4 (mn. yen) Operating revenue Rent revenue Four properties acquired in 22nd Period Two properties disposed in 22nd Period Office in Tokyo Area Office in Osaka Area Others 37 -2 -0 -0 Operating expenses Other lease business revenue -18 4,642 4,627 -14 (mn. yen) Utilities revenue -15 Other rent revenue 0 Operating income (mn. yen) 2,973 2,983 +9 Other operating revenue -3 Gain on distribution of TK interest (Nagoya 9 Ordinary income (mn. yen) 2,388 2,400 +11 Lucent Tower) Operating expenses -14 Income before income taxes 2,388 2,406 +17 (mn. yen) Expenses related to rent business (excl. depreciation and loss on retirement) Breakdown by property type 12 Net income (mn. yen) 2,387 2,405 +17 Four properties acquired in 22nd Period Two properties disposed in 22nd Period Office in Tokyo Area 0 Total distributions (mn. yen) 2,387 2,405 +17 Office in Osaka Area 16 Others 361 -3 -1 Distribution per unit (yen) 8,050 8,110 +60 Breakdown by items Gain/loss on real estate 3,615 3,593 -22 Taxes on property, plant and equipment Utilities expenses -0 -1 lease business (mn. yen) Repair expenses 10 Others 2 NOI (mn. yen) 4,876 4,850 -26 Depreciation and loss on retirement -4 Occupancy rate at end of Asset management fees -0 96.1% 97.0% +0.9pt period Other operating expenses -21 6 MCUBS MidCity Investment Corporation#77 23rd Period financial results - Breakdown of change from previous period Rent revenue Fiscal Period ended Dec. 31, 2017 (23rd Period) +261 -144 6,825 +10 -15 +40 +29 H Jun. 2017 (22nd Period) total Newly acquired four properties in '2017 Disposed two properties in 2017 Tenanted floor Vacated floor Revised rent Tenanted floor Office in Tokyo Area Net income 2,527 -331 (Unit: mn. yen) -85 +13 +27 6,962 Vacated floor Office in Osaka Area Fiscal Period ended Dec. 31, 2017 (23rd Period) vs 22nd Period +137 Revised rent Others Total (Unit: mn. yen) +31 -39 +56 2,405 +130 -30 +50 -58 +66 +4 Jun. 2017 (22nd Period) total Gains/ losses on sales of property Newly acquired four properties in 2017 vs 22nd Period -121 Disposed two properties in 2017 Office in Tokyo Office Area in Osaka Area Others TK interest Asset manage- ment fee Financing costs Others Total NOI after depreciation MCUBS MidCity Investment Corporation#88 Balance sheet (Unit: amount of money (mn. yen), ratio (%)) Description Fiscal Period ended Jun 30, 2017 (22nd Period) (as of Jun. 30, 2017) (mn. yen) (%) Fiscal Period Fiscal Period Fiscal Period ended Dec 31, 2017 (23rd Period) (as of Dec. 31, 2017) (mn. yen) ended Jun 30, 2017 ended Dec 31, 2017 Difference Difference Description (22nd Period) (23rd Period) (%) (mn. yen) (%) (as of Jun. 30, 2017) (mn. yen) (%) (as of Dec. 31, 2017) (mn. yen) (%) (mn. yen) (%) (Assets) I Total current assets (Liabilities) 16,135 6.5 16,569 6.7 Cash and deposits 9,911 11,031 433 1,119 2.7 I Total current liabilities 17,188 6.9 Operating accounts payable 606 18,533 508 7.4 1,345 7.8 -97 Cash and deposits in trust 5,535 5,246 -288 Current portion of 13,675 15,300 1,625 Operating accounts receivable 258 164 -93 long-term loans payable Income taxes receivable 20 27 6 Accounts payable - other 1,051 815 -235 Consumption taxes receivable 333 -333 Accrued expenses 139 132 -6 Prepaid expenses 47 42 -4 Distribution payable 7 8 1 Deferred tax assets 0 0 -0 Income taxes payable 305 305 Other 28 55 27 Advances received 1,092 1,084 -7 II Total non-current assets 232,551 93.5 232,161 93.3 -390 -0.2 Other 615 376 -238 1. Property, plant and equipment II Total non-current liabilities 103,958 41.8 102,565 41.2 -1,392 -1.3 3 Buildings in trust 77,291 78,072 Investment corporation bonds 6,000 6,000 -450 Accumulated depreciation -20,605 -21,837 Long-term loans payable 85,300 83,675 Structures in trust 130 137 Tenant leasehold and 4 12,299 12,726 -1,625 427 Accumulated depreciation -28 -31 security deposits Machinery and equipment in trust 7 7 Tenant leasehold and -0 358 164 -194 Accumulated depreciation -2 -3 security deposits in trust Tools, furniture and fixtures in trust 556 585 Total liabilities 121,146 48.7 121,099 48.7 -47 -0.0 7 Accumulated depreciation. -401 -422 (Net assets) Land in trust 169,977 169,977 -0 I Unitholders' equity Construction in progress in trust 5 4 -1 1. Unitholders' capital 127,675 125,148 51.3 127,737 51.3 62 0.0 125,148 Total property, plant and quipment 226,930 91.2 226,489 91.0 -441 -0.2 2. Surplus 2. Intangible assets Voluntary reserve 183 183 Software 4 3 -0 Unappropriated retained earnings 2,527 2,405 -121 Trademark right Total intangible assets 0 0 -0 (undisposed loss) 4 0.0 3 0.0 -0 -13.6 Total surplus 2,527 2,589 62 Total net assets Total liabilities and net assets 127,675 248,821 51.3 127,737 100.0 248,837 51.3 62 0.0 100.0 15 0.0 3. Investments and other assets Investment securities 5,085 5,085 Lease and guarantee deposits 10 10 Long-term prepaid expenses 522 573 51 Total investments and other assets 5,617 2.3 5,668 2.3 51 0.9 III Deferred assets 134 0.1 106 0.0 -27 -20.7 Total assets 248,821 100.0 248,837 100.0 15 0.0 CAPEX during the period: 817 mn. yen MCUBS MidCity Investment Corporation#99 Income statement Description Fiscal Period ended Jun. 30, 2017 (22nd Period) (Jan. 1, 2017-Jun. 30, 2017). Fiscal Period ended Dec. 31, 2017 (23rd Period) (Jul. 1, 2017-Dec. 31, 2017) Difference (Unit: amount of money (mn. yen), ratio (%)) Details of rent revenue (mn. yen) (%) (mn. yen) 1. Operating revenue Rent revenue real estate 8,025 100.0 7,610 (%) 100.0 (mn. yen) (%) Rent revenue 5,630 -414 -5.2 6,825 6,962 CAM revenue 1,124 Other lease business revenue Dividends income 535 510 107 138 Parking revenue 207 Loss on disposal of property 557 2. Operating expenses. 4,875 60.7 4,627 60.8 -247 -5.1 Expenses related to rent business 3,924 3,879 Loss on disposal of property 225 Details of expenses related to rent business Asset management fee 585 624 Asset custody fee 5 5 Property 851 Administrative service fees Directors' compensations Other operating expenses Operating income 3. Non-operating income 33 33 management fees 6 8 94 76 Utilities expenses 719 3,150 1 39.3 0.0 2,983 39.2 -167 -5.3 Real Estate taxes 594 2 0.0 1 94.9 Interest income Reversal of distribution payable Other Interest on refund 4. Non-operating expenses Interest expenses OHO 0 1 0 OTTO 0 Insurance premiums 11 1 1 Repair expenses 367 0 623 7.8 584 7.7 -38 -6.3 Depreciation 1,256 409 399 Corporate bonds interest. Borrowing related expenses 10 16 141 139 Other lease business expenses 77 Amortization of bond issuance costs Amortization of investment units issuance cost 3 4 20 23 Other Ordinary income Extraordinary income 39 30 2,527 31.5 2,400 5 31.5 0.1 -126 -5.0 Gain on donation of fixed assets Income before income taxes Income taxes Income taxes - current 5 2,527 0 31.5 0.0 2,406 0 0 0 Income taxes deferred 0 0 Net income 2,527 31.5 2,405 31.6 -121 -4.8 Retained earnings brought forward 0 0 0 26.1 Unappropriated retained earnings (undisposed loss) 2,527 2,405 -121 -4.8 31.6 169 LO -121 -4.8 0.0 -2.5 MCUBS MidCity Investment Corporation#1010 2. FORECASTS FOR THE 24TH AND 25TH FISCAL PERIOD MCUBS MidCity Investment Corporation#1111 Forecasts for the 24th and 25th fiscal period (Unit: mn. yen) Fiscal period Fiscal period Fiscal period Breakdown of Change between 24th and 23rd Periods Breakdown of Change between 25th and 24th Periods ended Dec. ending Jun. 2017 2018 ending Dec. 2018 Difference 24th-23rd Difference 25th-24th Operating revenue 278 Operating revenue 476 (23rd Period) (24th Period) (25th Period) Rent revenue 285 Rent revenue 408 Four properties newly Four properties newly 382 174 Operating revenue 7,610 7,888 8,365 +278 +476 acquired in 2018 acquired in 2018 (mn. yen) Office in Tokyo Area 6 Office in Tokyo Area 77 Operating expenses 4,627 4,548 4,874 -79 +325 Office in Osaka Area -99 Office in Osaka Area 155 (mn. yen) Others -3 Others 1 Operating income (mn. yen) 2,983 3,340 3,491 +357 +150 Other lease business Other lease business 8 44 revenue revenue Ordinary income (mn. yen) 2,400 2,738 2,876 +337 +138 Utilities revenue 1 Utilities revenue 47 Other rent revenue 14 Other rent revenue 1 Income before income taxes 2,406 2,738 2,876 +331 +138 (mn. yen) Other operating revenue -7 Other operating revenue -5 Gain on distribution -15 Gain on distribution 23 Net income (mn. yen) 2,405 2,737 2,875 +331 +138 Operating expenses -79 Operating expenses 325 Expenses related to rent business Expenses related to rent business -201 235 (Excl. depreciation and loss on (Excl. depreciation and loss on Total distributions (mn. yen) 2,405 2,735 2,875 +330 +139 retirement) retirement) Distribution per unit 1,622 Taxes on property, plant and equipment Taxes on property, plant 46 45 and equipment 1,665 1,750 +43 +85 (yen)(Note) (8,110) Utilities expenses -78 Utilities expenses 90 Repair expenses -177 Repair expenses 74 Gain/loss on real estate 3,593 4,016 4,202 +422 +186 lease business (mn. yen) Others 8 Others 24 NOI (mn. yen) 4,850 5,344 5,562 +494 +217 Depreciation and loss on retirement 71 Depreciation and loss on retirement 30 Occupancy rate at end of period 97.0% 97.3% 97.3% +0.3pt Asset management fees Others 17 32 Asset management fees Others 55 3 Note: Based on the investment unit split with the effective date on January 1, 2018, one-fifths of the actual amount of distributions per unit for the Fiscal Period ended Dec. 31, 2017 (23rd Period) is indicated, witih the actual amount of distributions before the investment unit split indicated in parentheses MCUBS MidCity Investment Corporation#1212 Breakdown of change from previous period Rent revenue (Unit: mn. yen) Jun. 2018 24th Period (Forecast) Dec. 2018 25th Period (Forecast) +382 +45 -51 +23 +81 -125 +174 +55 -28 +42 +59 -25 +66 +63 7,656 +4 -75 7,248 6,962 vs 23rd Period +285 vs 24th Period +408 Dec. 2017 Newly (23rd Period) acquired four properties Tenanted floor Vacated floor Revised rent Tenanted floor Vacated floor Revised rent Total Others Newly acquired four properties Tenanted floor Vacated floor Revised rent Tenanted floor Vacated floor Revised rent Total Others total in 2018 in 2018 Office in Tokyo Area Office in Osaka Area Office in Tokyo Area Office in Osaka Area Net income (Unit: mn. yen) Jun. 2018 24th Period (Forecast) Dec. 2018 25th Period (Forecast) +42 -14 +23 -55 +19 -22 +6 +139 2,875 +30 +28 +60 -15 -17 -10 +304 -50 2,737 vs 23rd 2,405 Period +331 vs 24th Period +138 Dec. 2017 Newly (23rd acquired Office Office Others Period) four properties in Tokyo in Osaka TK interest Area Area Asset manage- ment fee Financing Others Total costs Newly acquired four properties Office Office Others in Tokyo Area in Osaka Area TK interest Asset manage- ment fee Financing Others Total costs total in 2018 in 2018 NOI after depreciation NOI after depreciation MCUBS MidCity Investment Corporation#1313 3. RESULTS FOR THE 23RD FISCAL PERIOD MCUBS MidCity Investment Corporation#1414 Occupancy Occupancy (1st Period End to 23rd Period End) 99.2% 100% 98.5% 98.4% 98.4% 98.0% 97.4% 98% 97.0% 97.1% 97.4% 97.5% 97.6% 98.0% 97.7% 98.2% 97.6% 97.7% 97.5% 97.0% 97.0% 96.7% 96.2% 96.3% 96.1% 98.2% 97.4% 96% 97.2% 96.6% 96.7% 96.4% 95.8% 94% 95.2% 95.1% 95.4% 95.8% 95.6% 96.0% 96.2% 96.3% 96.2% 95.5% 94.6% 94.0% 93.9% 93.6% 92% 92.9% 93.0% 90% Multi-tenant buildings average -Portfolio average 0% Dec. Jun. Dec. 2006 2007 2007 1st 2nd 3rd Period Period Period Jun. Dec. Jun. Dec. 2008 2008 2009 2009 2010 4th 5th 6th 7th 8th Period Period Period Period Period Period Period Jun. Dec. Jun. Dec. Jun. Dec. Jun. 2010 2011 2011 9th 10th 11th 2013 2013 14th 15th Period Jun. Dec. 2012 2012 12th 13th Period Period Period Period Period Period Period Period Period Dec. 2014 2014 16th 17th Jun. Dec. Jun. 2015 2015 2016 18th 19th 20th Dec. Jun. Dec. 2016 2017 2017 21st 22nd 23rd Period Period Period Note: Multi-tenant buildings at the end of 23rd Period include; Sumitomo Fudosan Ueno Bldg. No.6,G-Square Shibuya Dogenzaka, Shibuya Sakuragaoka Square, Yokohama Creation Square, Cube Kawasaki, Higashi-Nihombashi Green Bldg., Sasazuka Center Bldg., USC Bldg., Twin 21, Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg., Higobashi MID Bldg. and Sendai Capital Tower MCUBS MidCity Investment Corporation#15Portfolio operation Tenanted/Vacated floor space and occupancy Tenanted floor space Vacated floor space Tenanted/Vacated Entire portfolio Multi-tenant buildings floor space (m²) Occupancy rate (%) 98.2 15,000 97.6 97.7 97.5 97.0 100 95 96.2 97.2 96.3 96.2 95.5 10,000 7,811 00 90 5,447 4,964 85 5,065 4,513 5,000 15 0 -5,000 -3,352 -3,827 -6,589 -6,272 -10,000 80 60 75 70 65 55 60 00 -9,469 55 MCUBS MidCity Investment Corporation -15,000 50 Dec. 2015 Jun. 2016 Dec. 2016 19th Period 20th Period 21st Period Jun. 2017 22nd Period Dec. 2017 23rd Period#1616 Occupancy by property Leasable 1Occupancy rate as of 2Occupancy rate as of Type Property Name Space Difference 2-1 New tenant (m³) Jun. 30, 2017 (22nd Period End) (%) Dec. 31, 2017 (23rd Period End) (%) occupancy Increase in leased space for (points) (m³) existing tenants(m) Tenant movements during 23rd Period (Jul. 1, 2017 - Dec. 31, 2017) Decrease in leased space for existing tenants(m) Cancellation (m³) Sumitomo Fudosan Ueno 6,858.16 100.0 100.0 Bldg. No.6 G-Square Shibuya 5,011.74 100.0 100.0 Dogenzaka Shibuya Sakuragaoka 6,379.66 100.0 100.0 Square Yokohama Creation Square 12,720.94 88.1 87.4 -0.7 Cube Kawasaki 24,494.06 91.1 100.0 8.9 79 562.48 2,207.87 -659.43 Higashi-Nihombashi Green 3,254.77 100.0 100.0 Bldg. Office Sasazuka Center Bldg. 8,219.90 73.4 85.6 12.2 998.69 USC Bldg. 5,781.98 100.0 100.0 Twin 21 82,304.84 98.2 97.8 -0.4 609.95 41.76 Matsushita IMP Bldg. 37,299.95 98.3 86.7 -11.5 1,646.97 84.24 -951.51 -6,142.09 -41.76 MID REIT Kyobashi Bldg. 4,833.88 100.0 100.0 MID Imabashi Bldg. 4,277.63 95.2 100.0 4.8 333.99 -130.18 Kitahama MID Bldg. 10,189.49 98.7 100.0 1.3 132.12 262.57 -262.57 MID Nishihommachi Bldg. 3,881.74 97.0 100.0 3.0 528.48 -407.02 Higobashi MID Bldg. 4,655.57 96.5 96.5 Sendai Capital Tower 12,999.51 98.8 95.2 -3.6 87.72 314.23 -874.51 AEON MALL Tsudanuma 101,210.44 100.0 100.0 Konami Sports Club Other 9,586.26 100.0 100.0 Kyobashi Dormy Inn Hakata Gion 5,554.91 100.0 100.0 Occupancy Office Occupancy rate 233,163.82 96.2 95.6 -0.7 7,108.27 702.80 -9,034.56 -434.51 rate by type Non-Office Occupancy rate 116,351.61 100.0 100.0 Total 349,515.43 97.5 97.0 -0.5 7,108.27 702.80 -9,034.56 -434.51 Increased by 7,811.07m* Decreased by -9,469.07m* Net decrease -1,658.00m MCUBS MidCity Investment Corporation#17Revisions and gaps in rents No. of rent revisions (No.) 25 Rent increase Rent decrease 20 17 20 15 10 6 5 5 1 0 1 0 1 2 0 5 5 5 3 2 1 1 2 0 10 15 10 14 20 Jun. 2013 Dec. 2013 Jun. 2014 14th Period 15th Period 16th Period Dec. 2014 17th Period Jun. 2015 18th Period Dec. 2015 19th Period Jun. 2016 20th Period Dec. 2016 21st Period Jun. 2017 22nd Period Dec. 2017 23rd Period 100% Gap in rents (Note) 100% 15% 21% Higher 75% 75% than market rent 28% Higher than market rent 15% More than 10% More than 10% Less than 10% Lower Less than 10% 50% 50% than Lower Less than -10% market 48% Less than -10% 25% than market rent 41% rent More than -10% More than -10% 25% 17 0% 15% Tokyo area 0% 16% Osaka area Note: Market rent refers to market's estimated concluded rent (standard floor) of each property appraised as of Dec. 2016 by CBRE. The rents identical with market rent are included in "within 10%". MCUBS MidCity Investment Corporation#1818 Surveys on tenants' satisfaction Targeted buildings: 7 properties in East Japan (G-Square Shibuya Dogenzaka, Shibuya Sakuragaoka Square, Yokohama Creation Square, Cube Kawasaki, Higashi-Nihombashi Green Bldg., Sasazuka Center Bldg. and Sendai Capital Tower) Survey period: Sample: 6 properties in Osaka (Twin 21 (MID Tower), Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg. and Higobashi MID Bldg.) Oct. 18, 2017 to Nov. 13, 2017 349 tenants Survey conducted by: Kanden CS Forum Inc. Survey findings - Level of CSI (Note 1) 2017 Factors 2013 2014 2015 2016 Total (East Japan) (Osaka) Surrounding environment 79.7 82.3 73.7 72.4 71.9 69.1 74.7 Behavior of MF (property management firm) 76.9 78.4 78.4 78.8 79.5 76.8 81.5 Comforts of building 57.2 58.6 55.3 54.5 56.8 54.8 58.8 Manner of management firm's staff 74.2 75.2 75.1 74.7 74.8 74.3 75.3 Behavior of PM 71.6 72.5 72.8 73.0 72.4 68.9 74.9 Measures for safety 69.7 70.4 69.2 66.3 68.3 65.4 71.2 Quality of common area Usability of building facilities & equipment Cleanliness of building 66.8 67.4 65.7 64.3 64.5 63.2 65.9 67.4 67.9 66.5 67.5 65.4 63.0 67.1 72.0 71.3 70.3 69.6 69.9 68.3 71.4 Note 1: CSI: Abbreviation of Customer Satisfaction Index. We had building facilities, services and others evaluated by customers, and gap between each item's needs (expectations) and satisfaction was weighted to adjust before calculating each item's evaluation with the full score of 100. Note 2: Properties targeted in the survey: 2013~: Twin 21, Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg., Midosuji MID Bldg., MID Midosujikawaramachi Bldg., Higobashi MID Bldg. 2015: Twin 21, Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg., Midosuji MID Bldg., MID Midosujikawaramachi Bldg., Higobashi MID Bldg., G-Square Shibuya Dogenzaka, Yokohama Creation Square, Cube Kawasaki 2016~: Twin 21, Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg., Midosuji MID Bldg., MID Midosujikawaramachi Bldg., Higobashi MID Bldg., G-Square Shibuya Dogenzaka, Yokohama Creation Square, Cube Kawasaki, Higashi-Nihombashi Green Bldg. 2017: Twin 21, Matsushita IMP Bldg., MID Imabashi Bldg., Kitahama MID Bldg., MID Nishihommachi Bldg., Higobashi MID Bldg., G-Square Shibuya Dogenzaka, Shibuya Sakuragaoka Square, Yokohama Creation Square, Cube Kawasaki, Higashi-Nihombashi Green Bldg., Sasazuka Center Bldg., Sendai Capital Tower MCUBS MidCity Investment Corporation#1919 Initiatives in Properties in the Portfolio Events for better office environment Renovation of common use space Renovations of the facilities and renewals of the interior have provided comfortable office environment and improved property's competitive strength. The renovation of the 2nd floor's common space of Cube Kawasaki was conducted in the 23rd Period. ▸ Event and decoration "Christmas Event" for 8 days including a concert and a flash mob held in OBP earned a good reputation. And Christmas trees colored with Christmas flowers set in the entrances of the below office assets had provided a sense of the season. [Before]】 【After】 Matsushita IMP Bldg. Twin 21 7 MC-UBS 5 2 /MC-UBS MC-UBS Cube Kawasaki Dec. 2017 G-Square Shibuya Dogenzaka Cube Kawasaki MC-UBS MC-UAS Higobashi MID Bldg. MCUBS MidCity Investment Corporation#2020 20 (This page is left blank intentionally) MCUBS MidCity Investment Corporation#2121 4. PORTFOLIO MCUBS MidCity Investment Corporation#2222 22 Portfolio profitability As of end of Jun. 2017 As of end of Dec. 2017 As of end of Mar. 2018 (Note 2) Average NOI yield (Note 1) Average NOI yield after depreciation (Note 1) 4.2% 3.1% 4.1% 4.1% 3.1% NOI yield after depreciation of each property by area (Note 3) NOI yield after 3.1% Dividend yield of TK interest Dividend yield depreciation Office Retail facilities Hotel Assets newly acquired 7.0% 5.5% 5.0% USC Bldg. 4.5% (approx. 46%) AEON MALL USC Bldg. Yoshiyasu 4.0% Tsudanuma Sasazuka Center Bldg. 3.5% 3.0% Sumitomo Fudosan Ueno Bldg. No.6 2.5% Cube Kawasaki Yokohama (approx. Creation 54%) Square G-Square Shibuya Dogenzaka Shibuya Sakuragaoka Square Kanda Bldg SSP Bldg. M-City Akasaka 1-chome Bldg. 2.0% Higashi-Nihombashi Green Bldg. 1.5% 1.0% 0.5% 0.0% Tokyo Area Note 1: TK interest of Nagoya Lucent Tower is not included. Konami Sports Club Kyobashi Dormy Inn Hakata Gion 6.0% Sendai 5.6% Capital Tower Assets newly acquired 5.0% Higobashi MID Bldg. Kitahama MID Bldg. Twin 21 3.7% 4.0% Nagoya Lucent Tower (TK interest) MID Nishihommachi Bldg. MID Imabashi Matsushita IMP Bldg. Bldg. MID REIT Kyobashi Bldg. Osaka Area Others 3.0% 2.0% 1.0% 0.0% Nagoya Area Note 2: Properties held as of the end of December 2017 are based on the actual NOI yield at the same point, while four properties newly acquired are based on figures stated in the respective appraisal reports Note 3: Size of each bubble is proportionate to the acquisition price of each asset. MCUBS MidCity Investment Corporation#2323 Portfolio overview (as of end of Dec. 2017 / 20 properties base) Office Area Property No. Property name Location Completion date Acquisition date Acquisition price (mn. yen) Appraisal value (mn. yen) NOI yield (Note1) NOI yield after depreciation (Notel) Leasable Space Occupancy (Note2) rate (%) (m) (%) (%) OT-1 OT-2 Sumitomo Fudosan Ueno Bldg. No.6 G-Square Shibuya Dogenzaka Taito-ku, Tokyo Nov. 1993 May 2015 7,460 8,300 4.1% 3.1% 6,858.16 100.0% Shibuya-ku, Tokyo Oct. 2009 Aug. 2015 12,220 14,500 3.9% 3.4% 5,011.74 100.0% Aug. 2015 5,000 OT-3 Shibuya Sakuragaoka Square Shibuya-ku, Tokyo Mar. 2010 19,500 3.8% 3.1% 6,379.66 100.0% Feb. 2017 12,130 OT-4 Yokohama Creation Square Kanagawa-ku, Yokohama Mar. 1994 Aug. 2015 7,080 7,960 4.4% 3.7% 12,720.94 87.4% Tokyo metropolitan area OT-5 Cube Kawasaki Kawasaki-ku, Kawasaki May 1982 Aug. 2015 20,050 22,300 3.6% 3.1% 24,494.06 100.0% OT-6 Higashi-Nihombashi Green Bldg. Chuo-ku, Tokyo Mar. 1988 Dec. 2015 2,705 3,030 4.1% 3.5% 3,254.77 100.0% OT-7 Sasazuka Center Bldg. Shibuya-ku, Tokyo Mar. 1995 Mar. 2017 8,700 9,290 4.1% 3.7% 8,219.90 85.6% Three major metropolitan areas Jan. 1990 OT-8 USC Bldg. (Quasi Co-ownership: 46%) Koto-ku, Tokyo Apr. 2017 5,000 5,230 5.0% 4.4% 5,781.98 100.0% added on to in Jan. 2007 00-1 Twin 21 Chuo-ku, Osaka Mar. 1986 Aug. 2006 68,700 54,500 4.0% 2.8% 82,304.84 97.8% Feb. 1990 00-2 Matsushita IMP Bldg. 00-4 MID REIT Kyobashi Bldg. Chuo-ku, Osaka Miyakojima-ku, Osaka Aug. 2006 24,600 21,700 3.9% 1.6% 37,299.95 86.7% added on to in Nov. 2003 Feb. 2000 Aug. 2006 2,300 1,460 2.3% 1.0% 4,833.88 100.0% Osaka metropolitan area 00-5 MID Imabashi Bldg. Chuo-ku, Osaka Oct. 1990 Apr. 2007 3,270 2,330 3.4% 1.9% 4,277.63 100.0% 00-7 Kitahama MID Bldg. Chuo-ku, Osaka Feb. 2008 Apr. 2008 10,800 9,290 4.0% 3.2% 10,189.49 100.0% 00-8 MID Nishihommachi Bldg. Nishi-ku, Osaka Mar. 1989 Oct. 2008 3,550 2,180 2.7% 1.6% 3,881.74 100.0% 00-9 Higobashi MID Bldg. Nishi-ku, Osaka Jan. 2010 June 2013 3,000 3,620 5.2% 3.7% 4,655.57 96.5% Other Other major cities OR-1 Sendai Capital Tower Aoba-ku, Sendai Mar. 1974 Feb. 2017 5,500 6,510 5.2% 4.5% 12,999.51 95.2% Subtotal (Office) 202,065 191,700 4.0% 2.9% 233,163.82 95.6% Other than Office Bldg. Sep. 2003 Tokyo metropolitan area RT-1 AEON MALL Tsudanuma Narashino-shi, Chiba Aug. 2006 26,100 28,400 4.8% 3.9% 101,210.44 100.0% Three major metropolitan added on to in Dec. 2007 areas Osaka metropolitan area RO-1 Konami Sports Club Kyobashi Miyakojima-ku, Osaka June 1999 Aug. 2006 2,780 3,380 6.1% 4.8% 9,586.26 100.0% Other Other major cities HR-1 Dormy Inn Hakata Gion Hakata-ku, Fukuoka Jan. 2009 Sep. 2013 2,280 3,420 6.5% 4.8% 5,554.91 100.0% Subtotal (Other than Office) Total 31,160 233,225 35,200 226,900 5.0% 4.0% 116,351.61 100.0% 4.1% 3.1% 349,515.43 97.0% TK Interest for Office Three major metropolitan Nagoya metropolitan Nagoya Lucent Tower TK-1 areas area (TK interest) Total Note 1: Note 2: Nishi-ku, Nagoya Aug. 2015 4,919 238,144 NOI yield and NOI yield after depreciation are based on annualized NOI in the 23rd period. Leasable space is based on data as of Dec. 31, 2017 which only includes the area of leasable room, and excludes those for warehouses, halls and parking lots. However, the leasable spaces of Konami Sports Club Kyobashi and AEON Mall Tsudanuma, the entire buildings of which are leased, include the common area and parking lot area, and those of MID REIT Kyobashi Bldg. and Dormy Inn Hakata include common area, respectively. For quasi co-owned properties, the leasable area is calculated by multiplying total space of the property by quasi co-ownership ratio of the trust beneficiary interest. MCUBS MidCity Investment Corporation#2424 Portfolio overview (after acquisitions of new assets / 23 properties base) Office Area Property No. Property name Location Completion date Acquisition date Acquisition price (mn. yen) Appraisal value (Notel) (mn. yen) (Note2) NOI yield NOI yield after depreciation (Note) Leasable Space (Note3) (%) (m) (%) Occupancy rate (Note) (%) OT-1 OT-2 Sumitomo Fudosan Ueno Bldg. No.6 G-Square Shibuya Dogenzaka Taito-ku, Tokyo Nov. 1993 May 2015 7,460 8,300 4.1% 3.1% 6,858.16 100.0% Shibuya-ku, Tokyo Oct. 2009 Aug. 2015 12,220 14,500 3.9% 3.4% 5,011.74 100.0% Aug. 2015 5,000 OT-3 Shibuya Sakuragaoka Square Shibuya-ku, Tokyo Mar. 2010 19,500 3.8% 3.1% 6,379.66 100.0% Feb. 2017 12,130 OT-4 Yokohama Creation Square Kanagawa-ku, Yokohama Mar. 1994 Aug. 2015 7,080 7,960 4.4% 3.7% 12,720.94 87.4% OT-5 Cube Kawasaki Tokyo metropolitan area OT-6 OT-7 Higashi-Nihombashi Green Bldg. Sasazuka Center Bldg. Kawasaki-ku, Kawasaki Chuo-ku, Tokyo May 1982 Aug. 2015 20,050 22,300 3.6% 3.1% 24,494.06 100.0% Mar. 1988 Dec. 2015 2,705 3,030 4.1% 3.5% 3,254.77 100.0% Shibuya-ku, Tokyo Mar. 1995 Mar. 2017 8,700 9,290 4.1% 3.7% 8,219.90 85.6% Jan. 1990 Apr. 2017 5,000 5,230 5.0% 4.4% OT-8 USC Bldg. Koto-ku, Tokyo 12,489.08. 100.0% added on to in Jan. 2007 Feb. 2018 Three major 5,800 6,070 4.6% 4.0% metropolitan areas. OT-9 Yoshiyasu Kanda Bldg. OT-10 SSP Bldg. OT-11 M-City Akasaka 1-chome Bldg. May. 1989 Chiyoda-ku, Tokyo Feb. 2018 4,000 4,260 4.2% 3.9% 3,149.30 100.0% Partial demolition of building: Aug. 2008 Chuo-ku, Tokyo Jan. 2008 Mar. 2018 9,200 10,200 4.4% 3.6% 6,123.81 100.0% Minato-ku, Tokyo Mar. 1985 Mar. 2018 4,205 4,280 3.8% 3.6% 2,636.62 100.0% 00-1 Twin 21 Chuo-ku, Osaka Mar. 1986 Aug. 2006 68,700 54,500 4.0% 2.8% 82,304.84 97.8% Feb. 1990 00-2 Matsushita IMP Bldg. Chuo-ku, Osaka Aug. 2006 24,600 21,700 3.9% 1.6% 37,299.95 86.7% added on to in Nov. 2003 Osaka metropolitan area 00-4 MID REIT Kyobashi Bldg. 00-5 00-7 Miyakojima-ku, Osaka Feb. 2000 Aug. 2006 2,300 1,460 2.3% 1.0% 4,833.88 100.0% MID Imabashi Bldg. Kitahama MID Bldg. Chuo-ku, Osaka Oct. 1990 Apr. 2007 3,270 2,330 3.4% 1.9% 4,277.63 100.0% Chuo-ku, Osaka Feb. 2008 Apr. 2008 10,800 9,290 4.0% 3.2% 10,189.49 100.0% 00-8 MID Nishihommachi Bldg. Nishi-ku, Osaka Mar. 1989 Oct. 2008 3,550 2,180 2.7% 1.6% 3,881.74 100.0% 00-9 Higobashi MID Bldg. Nishi-ku, Osaka Jan. 2010 June 2013 3,000 3,620 5.2% 3.7% 4,655.57 96.5% Other Other major cities OR-1 Sendai Capital Tower Aoba-ku, Sendai Mar. 1974 Feb. 2017 5,500 6,510 5.2% 4.5% 12,999.51 95.2% Subtotal (Office) 225,270 216,510 4.0% 3.0% 251,780.65 95.9% Other than Office Bldg. Sep. 2003 Three major metropolitan Tokyo metropolitan area RT-1 AEON MALL Tsudanuma Narashino-shi, Chiba Aug. 2006 26,100 28,400 4.8% 3.9% 101,210.44 100.0% added on to in Dec. 2007 areas Osaka metropolitan area RO-1 Konami Sports Club Kyobashi Miyakojima-ku, Osaka June 1999 Aug. 2006 2,780 3,380 6.1% 4.8% 9,586.26 100.0% Other Other major cities HR-1 Dormy Inn Hakata Gion Hakata-ku, Fukuoka Jan. 2009 Sep. 2013 2,280 3,420 6.5% 4.8% 5,554.91 100.0% Subtotal (Other than Office) Total 31,160 256,430 35,200 5.0% 4.0% 251,710 4.1% 3.1% 116,351.61 368,132.26 100.0% 97.2% TK Interest for Office Three major Nagoya Lucent Tower metropolitan Nagoya metropolitan area TK-1 areas (TK interest) Total Nishi-ku, Nagoya Aug. 2015 4,919 Note 1: Appraisal value is as of Dec. 31, 2017 (for Assets newly acquired, Dec. 1, 2017) 261,349 Note 2: With regard to NOI yield and NOI yield after depreciation, legacy properties are based on annualized actual NOI for the 23rd Period, while Assets newly acquired are based on NOI according to a direct income method stated in the respective appraisal reports Note 3: Leasable space is based on data as of Dec. 31, 2017 which only includes the area of leasable room, and excludes those for warehouses, halls and parking lots. However, the leasable spaces of Konami Sports Club Kyobashi and AEON Mall Tsudanuma, the entire buildings of which are leased, include the common area and parking lot area, and those of MID REIT Kyobashi Bldg. and Dormy Inn Hakata include common area, respectively. Note 4: Occupancy rate is represented by rates as of the end of Dec. 2017 MCUBS MidCity Investment Corporation#25Portfolio data 1 Left: as of End of Dec. 2017 / 20 properties base Right: as of Mar. 2018 / 23 properties base By area <Based on acquisition price> 3.3% 96.7% 3.0%. Three major metropolitan areas ■ Others <Based on acquisition price> 2.1%. 97.0% 3.0% 3.3% 1.9% 44.7% 50.0% 25 Note: TK interest of Nagoya Lucent Tower is not included. ■Tokyo area Osaka area Nagoya area Others 45.5% 49.6% By asset type <Based on acquisition price> 12.1% 1.0% 11.1% 86.9% ■ Office Retail facility ■ Hotel <Based on rent and CAM revenues (Note) > 1.3% 12.5% 86.2% ■ Office Retail facility ■ Hotel 0.9% 88.1% 1.2% 11.6% 87.3% MCUBS MidCity Investment Corporation#2626 Portfolio data 2 Left: as of End of Dec. 2017 / 20 properties base Right: as of Mar. 2018 / 23 properties base By asset size <Based on acquisition price> 26.3% 34.3% 28.8% 40.1% 7.2% 11.0% By tenant <Based on leased area (Note) > Others 44.2% Largest tenant 29.8% Largest tenant 28.3% Others 47.1% 10.0% 9.4% 8.4% 10.3% Twin 21 AEON MALL Tsudanuma ■Matsushita IMP Bldg. ■Cube Kawasaki ■Shibuya Sakuragaoka Square Others <Based on acquisition price (Note) > 6.6% 7.7% ■Twin 21 ■AEON MALL Tsudanuma ■Cube Kawasaki ■Matsushita IMP Bldg. ■Shibuya Sakuragaoka Square Others 24.3% 29.5% 24.5% 21.7% 100,000 m²- 50,000 m² 100,000 m² 10,000 m²-50,000 m² ■-10,000 m² Note: TK interest of Nagoya Lucent Tower is not included. 28.9% 26.8% Large tenants (2nd to 10th largest) 26.0% Large tenants (2nd to 10th largest) 24.6% <Based on rent and CAM revenues (Note) > Largest tenant 13.8% Others 19.8% 57.3% 24.5% Large tenants (2nd to 10th largest) 28.9% Others 58.9% Largest tenant 12.7% Large tenants (2nd to 10th largest) 28.4% MCUBS MidCity Investment Corporation#2727 Revenue and expenses by property 1 (fiscal period ended Dec. 31, 2017) (Unit: mn. yen) Operating days Rent revenue CAM revenue Parking revenue Rent revenue - real estate Utilities revenue Early-withdrawal penalties received Other revenue Other lease business revenue Sumitomo Fudosan Ueno G-Square Shibuya Shibuya Sakuragaoka Yokohama Creation Higashi- Bldg. No.6 Dogenzaka Square Square 184 184 184 184 184 Cube Kawasaki Nihombashi Green Bldg. 184 Sasazuka Center Bldg. Matsushita USC Bldg. Twin 21 IMP Bldg. 184 184 184 184 246 286 176 492 42 165 90 1,630 756 31 52 102 79 25 45 41 438 110 3 4 15 2 3 7 5 62 50 280 343 294 573 71 218 138 2,130 917 20 20 26 26 11 47 4 7 12 147 81 1 Property leasing revenue Not Disclosed Property management fees Utilities expenses Real estate taxes Insurance premiums Repair expenses Other lease business expenses 2 Expenses related to rent business 3 NOI (1-2) ④Depreciation ⑤ Loss on retirement of non-current assets ⑥ Property leasing income 4- ⑤) CAPEX I I 5 ☐ I st 4 I ☐ 0 2 9 2 3 2 3 11 4 I TTT 221 21 301 372 15 WNN 28 26 50 50 8 10 15 163 86 320 624 80 228 153 2,293 1,003 13 81 55 7 20 11 321 175 16 26 34 77 7 16 15 281 133 ☐ 22 6. 26 26 62 62 5 0 0 196 122 1 0 0 0 0 0 0 0 3 2 I 3 0 0 69 63 3 9 0 67 54 0 0 18 0 0 0 0 21 26 - 59 48 163 260 24 47 28 891 515 153 242 323 157 363 55 180 125 1,402 488 36 31 54 24 46 7 20 14 440 284 117 TA - - - 210 269 132 316 5 2 1 4 47 47 160 110 961 204 60 80 30 5 323 331 MCUBS MidCity Investment Corporation#2828 Revenue and expenses by property 2 (fiscal period ended Dec. 31, 2017) Operating days Rent revenue CAM revenue Parking revenue Rent revenue - real estate Utilities revenue Early-withdrawal penalties received Other revenue Other lease business revenue (Unit: mn. yen) MID REIT Kyobashi Bldg. MID Imabashi Kitahama MID Bldg. Bldg. MID Nishi- hommachi Bldg. Higobashi MID Sendai Capital AEON MALL Bldg. Tower Tsudanuma Konami Sports Club Kyobashi Dormy Inn Hakata Gion Total 184 184 184 184 184 184 184 184 184 76 218 64 83 177 726 5,630 4 48 6 19 48 7 7 3 2 19 I 89 274 74 105 245 726 | | | 1,124 207 I 7 38 9 11 17 I I I I 6,962 454 9 46 46 Not Disclosed 1 Property leasing revenue Property management fees Utilities expenses Real estate taxes Insurance premiums Repair expenses Other lease business expenses 2 Expenses related to rent business 3 NOI(1-2) 4 Depreciation. 5 Loss on retirement of non-current assets 6 Property leasing income 1-( 5) CAPEX I I I I IT I 0 1 1 0 2 I 7 40 40 10 11 20 Not 96 314 85 117 265 726 Disclosed IT Not Disclosed IT 510 14 31 11 12 37 2 8 30 9 10 38 - I 7,472 851 719 11 22 8 12 0 61 ☐ 0 0 0 0 0 0 I I 4 14 5 2 42 35 55 I 594 11 367 1 0 1 1 1 I I 77 40 99 36 39 120 100 2,622 26 55 215 48 78 145 625 86 74 4,850 14 24 39 20 22 21 115 18 19 1,256 - - 11 31 I - - I 176 28 18 2 1 - 55 123 510 I 8 - 40 67 55 3,593 817 MCUBS MidCity Investment Corporation#2929 Appraisal values by property Acquisition price Type Region Property name (Note1) (mn yen) Appraisal value as of Jun. 30, 2017 (22nd Period End) (mn. yen) 2017 (23rd Period End) (Note2) Book value as of Dec. 31, Appraisal value as of Dec. 31, 2017 (23rd Period Difference Difference from previous End) (Note3) period end (%) from book value (%) 22nd Period appraisal value 23rd Period appraisal value Appraisal company rate (Note4) rate (Note4) (%) (%) (mn. yen) (mn. yen) Sumitomo Fudosan Ueno Bldg. No.6 7,460 8,230 7,647 8,300 0.9% 8.5% Tanizawa Sogo Appraisal Co., Ltd. 3.9% 3.9% G-Square Shibuya Dogenzaka 12,220 14,500 12,246 14,500 18.4% Japan Real Estate Institute 3.3% 3.3% Shibuya Sakuragaoka Square 17,130 19,600 17,506 19,500 -0.5% 11.4% Daiwa Real Estate Appraisal Co., Ltd. 3.1% 3.1% Yokohama Creation Square 7,080 7,800 7,075 7,960 2.1% 12.5% Tanizawa Sogo Appraisal Co., Ltd. 4.4% 4.3% Cube Kawasaki 20,050 22,200 20,474 22,300 0.5% 8.9% Daiwa Real Estate Appraisal Co., Ltd. 4.0% 4.0% Higashi-Nihombashi Green Bldg. 2,705 3,030 2,838 3,030 6.8% Japan Real Estate Institute 4.3% 4.3% Three major metropolitan areas Sasazuka Center Bldg. 8,700 9,290 9,095 9,290 2.1% Daiwa Real Estate Appraisal Co., Ltd. 4.0% 4.0% USC Bldg. (Note 5) 5,000 5,230 5,175 5,230 Office (Tokyo / Osaka / Twin 21 68,700 51,700 66,131 54,500 5.4% 1.1% Tanizawa Sogo Appraisal Co., Ltd. -17.6% Morii Appraisal & Investment Consulting, Inc. 4.1% 4.1% 4.4% 4.4% Nagoya) Matsushita IMP Bldg. 24,600 21,200 22,573 21,700 2.4% -3.9% Tanizawa Sogo Appraisal Co., Ltd. 4.5% 4.4% MID REIT Kyobashi Bldg. 2,300 1,440 2,076 1,460 1.4% -29.7% Tanizawa Sogo Appraisal Co., Ltd. 5.1% 5.0% MID Imabashi Bldg. 3,270 2,260 3,114 2,330 3.1% -25.2% Tanizawa Sogo Appraisal Co., Ltd. 4.6% 4.5% Kitahama MID Bldg. 10,800 9,050 10,365 9,290 2.7% -10.4% Japan Real Estate Institute 4.3% 4.2% MID Nishihommachi Bldg. 3,550 2,180 3,356 2,180 -35.1% Japan Real Estate Institute 4.5% 4.5% Higobashi MID Bldg. 3,000 3,520 2,839 3,620 2.8% 27.5% Japan Real Estate Institute 4.2% 4.1% Other metropolitan Sendai Capital Tower 5,500 6,350 5,595 6,510 2.5% 16.3% Tanizawa Sogo Appraisal Co., Ltd. 4.7% 4.6% area Subtotal 202,065 187,580 198,111 191,700 2.2% -3.2% Three major AEON MALL Tsudanuma 26,100 27,800 23,839 28,400 2.2% 19.1% Daiwa Real Estate Appraisal Co., Ltd. 4.6% 4.5% Other metropolitan areas Konami Sports Club Kyobashi 2,780 3,300 2,394 3,380 2.4% 41.2% Daiwa Real Estate Appraisal Co., Ltd. 5.1% 5.0% Other metropolitan Dormy Inn Hakata Gion 2,280 3,360 2,139 3,420 1.8% 59.8% Tanizawa Sogo Appraisal Co., Ltd. 4.3% 4.2% area Subtotal Total 31,160 233,225 34,460 28,373 35,200 2.1% 24.1% 222,040 226,485 226,900 2.2% 0.2% Note 1: "Acquisition price" is the transaction price which is stated in the contract for respective trust beneficiary interest, etc. (excluding acquisition-related expenses, property taxes and consumption taxes, etc.). Note 2: "Book value" is the applicable asset's acquisition price (including various acquisition expenses) less accumulated depreciation. Note 3: "Appraisal value" is as of the end of the fiscal period based on the appraisal report with the market value as of Dec. 31, 2017 prepared by Morii Appraisal & Investment Consulting, Inc., Tanizawa Sogo Appraisal Co., Ltd., Daiwa Real Estate Appraisal Co., Ltd. or Japan Real Estate Institute pursuant to the Regulations Concerning Accounting of Investment Corporations, methods and criteria for asset valuation defined in MCUBS MidCity's Articles of Incorporation and rules of The Investment Trusts Association, Japan. Note 4: "Appraisal value rate" is the cap rate based on the direct capitalization method. Note 5: Appraisal value of USC bldg. is consisted of the share (50/108) MCUBS MidCity Investment Corporation#3030 Unrealized gain/loss Unrealized gain/loss and unrealized gain/loss rate (Dec. 2006 (1st Period) – Dec. 2017 (23rd Period)) - (100mn. yen) 100 Unrealized gain/loss Unrealized gain/loss rate (Unrealized gain/loss rate) 10.0% 0 (100) (200) (300) 46 48 29 33 -2.6% 3.1% 2.2% 3.0% -10.0% 2.0% -42 -13.3% -14.9% -15.0% -15.0% -14.8% -161 -19.9% -23.4% -22.7% -24.5% -216 -241 -242 -239 -240 -19.4% -21.6% -20.9% 0.2% 4 -2.2% 0.0% -7.3% -9.0% -48 -11.4% -10.0% -235 -150 -185 -20.0% -30.0% -310 -318 -320 -331 -351 -358 (400) -387 -40.0% Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. 2006 2007 2007 2008 2008 2009 2009 2010 1st 2nd 3rd 4th 5th 6th 7th 8th Period Period Period. Period Period Period Period Period Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. 2010 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2016 9th 10th 11th 12th 13th 14th 15th 16th 17th 18th 19th 20th 21st Period Period Period Period Period Period Period Period Period Period Period Period Period Jun. Dec. Jun. Dec. 2016 2017 2017 22nd 23rd Period Period As of 23rd Period End (ended Dec. 2017) Book value: 226.4 bn. yen Appraisal value: 226.9 bn. yen Unrealized gain: 0.4 bn. yen MCUBS MidCity Investment Corporation#31Portfolio overview - Tokyo area 1 Omiya Sumitomo Fudosan Ueno Bldg. No.6 Sasazuka Center Bldg. Ueno Shinjyuku Tachikawa New Yoshiyasu Kanda Bldg. The Prim Higashi-Nihombashi Green Bldg. G-Square Shibuya Dogenzaka Chiba Tsudanuma Akihabara Tokyo New SSP Bldg. Shibuya E SPACE TOWER Keio Inokashira Line AEON Mall Tsudanuma Shinagawa Additional acquisition USC Bldg. Bunkamura Tokyu Department Store Seibu Department Store Sibuya 109 Shinsen Sta. Nampeidai Project completion 2019 Shibuya Sakuragaoka Square G-Square Shibuya Dogenzaka New The Prim-Shibuya M-City Akasaka 1-chome Bldg. Tokyu Denentoshi Line Sibuya Sta. Shibuya Sta. Gaiku Development Plan completion 2019 (East Tower 2027 (Centrer, West Tower), Dogenzaka Íchome Ekimae Area Shibuya Mark City completion:2019 Metoropolitan Expressway Routs (Shibuya Line) Shibuya Sta. Sakuragaoka Area Development Plan completion: 2020 Cerulean Tower Redevelopment Shibuya Hikarie Tokyu Toyoko Line JR Yamanote Line Office Retail Shibuya Sta. South Gaiku Project. completion: 2018 Shibuya Sakuragaoka Square Shibuya Infoss Tower Kawasaki Tokyo International Airport (Haneda Airport) <As of Mar, 2018> Cube Kawasaki Tokyo Area No. of assets 12 Yokohama Yokohama Creation Square ✓ofuna Tokyo Area Osaka Area Shibuya Area % of portfolio 49.6% No. of assets 8 % of portfolio 45.5% Note: Based on acquisition price. TK interest of Nagoya Lucent Tower is included in the acquisition price. 31 1 Nagoya Area No. of assets % of portfolio 1.9% Other Major No. of assets 2 % of portfolio 3.0% Cities MCUBS MidCity Investment Corporation#32Portfolio overview - Osaka area, Nagoya area and others Umeda Sta. JR Osaka Sta. Kobe Konami Sports Club Kyobashi Twin 21 MID REIT Kyobashi Bldg. Kyoto Kyobashi Sta. Crystal Tower MID Imabashi Bldg. Yodoyabashi Higobashi Sta. Sta. Higobashi MID Bldg. MID Nishihommachi Bldg. Mido-suji Ave. Hommachi Sta. Yotsubashi-suji Ave. Osaka Area Kitahama Sta. Osaka Business Park (OBP) Sakai-suji Ave Kitahama MID Bldg. Osaka Castle Chuo-odori St. Shinsaibashi Sta. Nagahor St. Kamejima Sta. Tanimachi-suji Ave Umeda Area Yodoyabashi Area Hommachi Area Osaka Business Park Enkei Hall Maruito OBP Bldg. (Hotel Monterey Lasoeur Osaka) Fujitsu Kansai Systems Laboratory OBP Yomiuri TV Headquarters Bldg. Osaka Tokyo Kaijyo Nichido Bldg. KDDI Osaka 2nd Bldg. KDDI Osaka Bldg. Kinki Osaka Bank Head Office Castle Tower Bldg. Sumitomo Life Head Office Osaka Business Park Matsushiita IMP Hall Shinshigino Bridge Matsushita IMP Bldg. Hotel New Otani Osaka Sumitomo Life OBP Plaza Bldg. (Izumi Hall) Osaka Business Park (OBP) Aoba-dori Ave. JR Aoba-dori-Sta Sendai Central 3 Post Office Subway Tozai Line West Exit Sendai Sta. JR Sendai Sta Tohoku Fukushi Univ. Sendai Sta. East-exit Campus R-Senseki-Line- Sendai Capital Tower Hotel Monterey Office Building Sendai Hotel Metropolitan Sendai The Westin Sendai Higashi-Nibancho-dori Ave Parking- Structure Sendai Washington JR Sendai Hospital Park Sendai Central Post Office Other - Sendai| MCUBS MidCity Investment Corporation Subway Namboku Hotel tago-Kamisugi-doni Ave. Namboku Line Tohoku Shinkanse JR Tohoku Linensen Miyagino-dori Sta. Shintera-don Ave. 32 JR Central Towers Nagoya Area Nagoya Lucent Tower Meitetsu Don Lucent Avenue eitetsu Nagoya Line Nagoya Sta. Subway Sakura-dori Line Sakura Dor Midland Square Meitetsu Nagoya Sta. way Hakozam ezeqene ns Taihaku Dori Fukuoka Expressway Dormy Inn Hakata Gion Kushida Shrine Kokutai Road Kagoshima Main Line Sanyo Shinkansen Obway Airport Line Gion Hakata Ward Office Hakata Canal city Hakata Other - Fukuoka#33Portfolio overview - Office in Tokyo area 1 Sumitomo Fudosan Ueno Bldg. No.6 ✓ Office building with the standard floor area of over 200 tsubo, with high scarcity value in Ueno Area ✓ Stable occupancy by leasing the entire building to a major manufacturer group Location Taito-ku, Tokyo 1,323.78m 9,631.83m SRC/B2F-11F Nov. 1993 G-Square Shibuya Dogenzaka ✓ Located in Shibuya/Ebisu, an area with one of the lowest vacancy rates in Tokyo ✓ Recently built high-grade office building, which is rare in Shibuya area ✓ Two-minute walk from Shibuya Mark City, and three-minute walk from Shibuya Station on the Tokyo Metro lines Location Total land space Total floor space Structure/scale Completion date Acquisition price Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date May 2015 7,460 mn.yen Acquisition Date 33 Shibuya-ku, Tokyo 918.49m 6,565.87m S-SRC/B2F-9F Oct. 2009 12,220 mn.yen Aug. 2015 Shibuya Sakuragaoka Square ✓ Located in Shibuya/Ebisu, an area with one of the lowest vacancy rates in Tokyo ✓ Located in the area with a lot of office buildings facing National Route 246 ✓ Four-minutes walk from Shibuya Station. Newly- built mid-sized office building with a standard floor area pf approx. 190 tsubo Location Total land space Total floor space Structure/scale Completion date Acquisition price Shibuya-ku, Tokyo 1,200.08m² 8,655.61m² S⚫RC/B1F-10F Mar. 2010 17,130 mn.yen (Incl. additional acquisition: 12,130 mn.yen) Acquisition Date Aug. 2015, Feb.2017 MCUBS MidCity Investment Corporation#3434 Portfolio overview - Office in Tokyo area 2 Yokohama Creation Square ✓ Located in the vicinity of the east exit of Yokohama Station, where large office buildings concentrate ✓ An office building with a large floor allowing a variety of layouts ranging from approximately 20 to 230 tsubo Cube Kawasaki ✓ Closely located to JR Kawasaki Station ކ that offers a good transportation access A rare property with a standard floor area of approx. 780 tsubo that addresses demand for large office spaces 41,290.91m SRC/B2F-10F May 1982 20,050 mn.yen Aug. 2015 Higashi-Nihombashi Green Bldg. ✓ Highly convenient location for transport with easy access to four stations of four railway lines Highly-visible and well-lit office building located at the corner of Kiyosugi-dori, an arterial road Location Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Chuo-ku, Tokyo 599.07m² 4,210.72m SRC/10F Mar. 1988 2,705 mn.yen Dec. 2015 *Sectional ownership Location Kanagawa-ku, Yokohama Location 5,244.81m² Mar. 1994 Total land space space Total floor Structure/scale Completion date Acquisition price (ratio of right of site 75.4%) 21,054.60m (ratio of exclusive area: 96.5%) SRC S/B1F-20F 7,080 mn.yen Acquisition Date Aug. 2015 Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Kawasaki-ku, Kawasaki 6,247.94m MCUBS MidCity Investment Corporation#35Portfolio overview - Office in Tokyo area 3 Sasazuka Center Bldg. ✓ Location with traffic convenience, within five-minute walk from Sasazuka Station of the Keio Line, which is one station or about five minutes away from Shinjuku Station ✓ Good access by car, as it faces a boulevard and is located near the Hatagaya Ramp of the Metropolitan Expressway ✓ Building differentiated from other buildings in the area with the standard floor area of approximately 300 tsubo Location Total land space Total floor space Structure/scale Completion date Shibuya-ku, Tokyo 3,032.26m 11,973.11m SRC/B2F-8F Mar. 1995 USC Bldg. ✓ Additional acquisition ✓ Location within seven-minute walk from Toyocho Station of the Tokyo Metro Tozai Line Building differentiated from other buildings in the area with many mid and small-sized buildings, for its size with the total floor area of approximately 5,600 tsubo and the standard floor area of approximately 600 tsubo Convenience in vehicle use with more than 100 parking lots, attracting vehicle-user tenants Location Total land space Total floor space Structure/scale Completion date Koto-ku, Tokyo 4,565.21m 18,506.16m Main Building: S-SRC/B1F-8F Annex: RC/1F Jan. 1990 and other Acquisition price Acquisition Date 8,700 mn. yen Acquisition price 10,800 mn.yen Mar. 2017 Acquisition Date Apr. 2017, Feb. 2018 35 MCUBS MidCity Investment Corporation#3636 Portfolio overview - Office in Osaka area 1 Twin 21 ✓ 38-storied sky-scraper office towers as a symbol of Osaka Business Park (OBP) ✓ Directly connected to Kyobashi Station, one of the biggest terminal stations in Osaka ✓ Mainly consisted of two buildings: OBP Panasonic Tower which is leased to Panasonic and MID Tower to leading corporations and consulates Location Total land space Total floor space Structure/scale Completion date Chuo-ku, Osaka 28,163.07m 146,034.98m SRC/B1F-38F Mar. 1986 68,700 mn.yen Acquisition price Acquisition Date Aug. 2006 Matsushita IMP Bldg. ✓ 26-storied high-rise complex building consisted of large office space, commercial facilities and event halls ✓ Directly connected to Osaka Business Park Station of the Osaka Municipal Subway Nagahori- Tsurumi Line ✓ Operated together with Twin 21, with which the building is connected through Skyway Location Chuo-ku, Osaka Total land space 14,968.25m Total floor space Structure/scale Completion date Acquisition price Acquisition Date 84,952.57m S-SRC/B2F-26F Feb. 1990, added on to in Nov. 2003 24,600 mn.yen Aug. 2006 MID REIT Kyobashi Bldg. ✓ Located near Kyobashi Station of the Osaka Municipal Subway Nagahori-Tsurumi Line, and within walking distance from Kyobashi Station of the JR Kanjo Line and the Keihan Main Line Location Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Miyakojima-ku, Osaka 1,062.53m² 4,833.88m² S/9F Feb. 2000 2,300 mn.yen Aug. 2006 MCUBS MidCity Investment Corporation#3737 Portfolio overview - Office in Osaka area 2 MID Imabashi Bldg. ✓ Located in the Yodoyabashi and Kitahama business district ✓ Three-minute walk from Kitahama Station of the Osaka Municipal Subway Sakaisuji Line and the Keihan Main Line, and five-minute walk from Yodoyabashi Station of the Osaka Municipal Subway Midosuji Line and the Keihan Main Line ✓ High-grade office building with sophisticated appearance with the granite-covered outer wall Location Chuo-ku, Osaka 1,187.43m² 7,482.53m² S-RC/B2F-11F Oct. 1990 Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Apr. 2007 Kitahama MID Bldg. ✓ Located close to Sakaisuji, one of the artery roads in Osaka, and nearby Kitahama Station of the Osaka Municipal Subway Sakaisuji Line and the Keihan Main Line ✓ Vibration controlled-building to reduce potential earthquake damages ✓ High-spec building with a floor with pillarless space of 176 tsubo, which addresses various layout/space needs Location Total land space Total floor space Structure/scale Completion date 3,270 mn.yen Acquisition price Acquisition Date Chuo-ku, Osaka 1,802.49m² 14,648.13m² S.SRC/B1F-18F Feb. 2008 10,800 mn.yen Apr. 2008 MID Nishihommachi Bldg. ✓ Favorable location facing Yotsubashisuji Boulevard and Chuo-Odori Street, with one- minute walk from Hommachi Station of the Osaka Municipal Subway ✓ High-quality office building supporting tenants' business activities with its comfortableness and traffic convenience, partly thanks to the vicinity to the Awaza Ramp on Hanshin Expressway Location Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Nishi-ku, Osaka 659.86m² 6,260.16m² S⚫RC/B3F-9F Mar. 1989 3,550 mn.yen Oct. 2008 MCUBS MidCity Investment Corporation#3838 Portfolio overview - Office in Osaka, others and TK interest Higobashi MID Bldg. ✓ Located in the Higobashi business district ✓ Located along Yotsubashisuji Boulevard, with one- minute walk from Higobashi Station of the Osaka Municipal Subway Yotsuboashi Line and six-minute walk from Yodoyabashi Station of the Osaka Municipal Subway Midosuji Line and Watanabebashi Station of the Keihan Nakanoshima Line ✓ Quake-resistant building with its vibration control structure, obtaining environmental certification Location Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Nishi-ku, Osaka 797.86m² 6,519.63m² S/B1F-11F Jan. 2010 3,000 mn.yen Jun. 2013 ✓ ✓ Sendai Capital Tower Location within four-minute walking distance from JR Sendai Station and two-minute from Sendai Station of the Sendai Subway Namboku Line and the Tozai Line Scarcity for its size in the area with many small to medium-sized buildings, with a total floor area of approximately 7,200 tsubo and a standard floor area of approximately 240 tsubo, and the parking lots for more than 100 vehicles. Location Total land space Total floor space Structure/scale Completion date Acquisition price Acquisition Date Aoba-ku, Sendai-shi, Miyagi 3,420.02m 23,702.00m (including Parking Space) Office building: SRC/B2F-19F Parking structure: RC/B1F-6F Mar. 1974 5,500 mn. Yen Feb. 2017 *TK interest Nagoya Lucent Tower Favorable location close to Nagoya Station, an area in which the strongest demand from tenants is expected within Nagoya City ✓ Highly visible 42-storied building (with 3 basement floors) for its arch- shaped characteristic appearance Location Completion date Acquisition price Acquisition Date Nishi-ku, Nagoya Nov. 2006 4,919 mn.yen Aug. 2015 *1 MCUBS MidCity owns the TK interest with R40 GK as the operator (TK interest B: equity interest of 40%) backed by real estate in trust for the trust beneficiary interests with 33.9% co-ownership interest (and 29.5% right of site) of the sectional ownership of this asset (sections of the building excluding the special high voltage substation building and part of the extra high voltage substation building) *2 The property overview as above represents that of the underlying asset of such TK interest MCUBS MidCity Investment Corporation#39Portfolio overview - Other than the office ON KONAMI AEON Mall Tsudanuma ✓ Large commercial facility directly connected to Shin Tsudanuma Station of the Shin-Keisei Line ✓ Three-minute walk from Tsudanuma Station of the JR Sobu Line ✓ Urban-type shopping center with AEON Mall as a core store Location Total land space Total floor space Structure/scale Narashino-shi, Chiba Konami Sport Club Kyobashi ✓ Located nearby Kyobashi Station of the Osaka Municipal Subway Nagahori-Tsurumi Line, and two-minute walk from Kyobashi Station of the JR Kanjo Line and the Keihan Main Line ✓ Located in an area where a sports club may have strong potential of attracting clients Location Total land space Total floor space 29,397.03m² 96,033.49m² S/B1F-5F Completion date Sep. 2003, added on to in Dec. 2007 Acquisition price Acquisition Date Structure/scale Completion date Acquisition price Acquisition Date Aug. 2006, Dec. 2007 39 26,100 mn.yen Miyakojima-ku, Osaka 2,339.35m² 9,433.34m² S/7F Jun. 1999 2,780 mn.yen Aug. 2006 ✓ Dormy Inn Hakata Gion Favorable location with two-minute walk from Gion Station of the Fukuoka City Subway Kuko Line, the next station of Hakata Station ✓ Hotel with expected demand from both business people and tourists for its good access to Fukuoka Airport, Hakata Station and Tenjin Area Location Hakata-ku, Fukuoka Total land space 1,002.19m² Total floor space Structure/scale 5,633.28m² RC/10F Completion date Jan. 2009 Acquisition price 2,280 mn.yen Acquisition Date Sep. 2013 MCUBS MidCity Investment Corporation#40Newly acquired assets - SSP Bldg. Property acquired through an exclusive negotiation with a CRE proposal by utilizing the sponsor network Key reasons for acquisition Negotiation transaction Sponsor network ✓ Acquisition through an exclusive negotiation with a CRE proposal by utilizing the sponsor network, which is in consideration of secured profitability ✓ Property of younger age of ten years with its differentiated scale, its high usage efficiency of office space, and its high-grade feel ✓ Located in Chuo-ku, Tokyo and three minutes' walk from Hamacho Station Property information/Surrounding environment Located at the corner of the Kiyosubashi-Dori and Kinza-Dori, accessible from six stations of five railway and subway lines ● Conveniently situated for office workers as surrounded by a number of restaurants and convenience stores - located near Tokyo City Air Terminal and easily accessible to airports • Specifications represented by the exterior covered with glass curtain walls, a textured and well-lit entrance hall with a sophisticatedly-designed facade and flexible layout of office space boost the property's competitiveness in this area 40 40 Bakurocho Station Mukojima Route Expressway No.6 Metropolitan Higashi- Nihombashi Station Bakuroyokoyama Station Location Access Total floor space S/10F Total land space accessible from six stations of five railway and subway lines 1,135.18m² 8,123.17m² Three minutes' walk from Hamacho Station on the Toei Subway Shinjuku Line, 2-12-4, Nihombashi Hamacho, Chuo-ku, Tokyo MAP JR Sobu Main Line -Tokyo Structure/Floor Construction Completion Jan, 2008 Acquisition Price Acquisition Date 9,200 mn.yen Mar. 1, 2018 Nihombashi Tax Office SSP Bldg. Toei Subway Shinjuku Line Hisamatsu Police Station Kinza-Dori Toei Subway Asakusa Line Sumida River Nihonbashi Fire Station (Ningyocho Branch) Ningyocho Station Kiyosubashi-Dori Hamacho Station Meijiza Hamacho Park Tokyo Metro Hibiya Line MCUBS MidCity Investment Corporation#41Newly acquired assets - Yoshiyasu Kanda Bldg. Property in Chiyoda-ku, maintaining a stable occupancy with long-residing tenants Key reasons for acquisition ✓ Located in a convenient area, accessible from four stations of seven railway and subway lines Sponsor network ✓ Property maintaining a stable occupancy as majority of tenants have kept contracts for a long term (greater than 10 years) ✓ Located where relatively older mid-to-high-rise retail stores and office buildings line side-by-side in Chiyoda-ku, Tokyo Property information/Surrounding environment High accessibility as located near the Showa-Dori and a four minutes' walk from Kodemmacho Station The building with the standard floor area of nearly 140 tsubo achieves higher usage efficiency of pillar-free spaces and enables flexible office layout • Constituting a competitive advantage over other buildings of the similar age as some renovation works were already implemented including the repair work of the rooftop and parking lots in 2008 and renewal of the entrance and other common use spaces in 2012 N Location Access Total land space 2-1-15, Iwamotocho, Chiyoda-ku, Tokyo a four minutes' walk from Kodemmacho Station on the Tokyo Metro Hibiya Line, accessible from four stations of seven railway and subway lines 715.69m² 4,554.00m² SRS-S/9F Total floor space Structure / Floor Construction Completion May, 1989. and other Acquisition Price 4,000 mn. yen Acquisition Date Feb. 16, 2018 41 MAP Iwamotocho Station Yasukuni-Dori Toei Subway Shinjuku Line R Keihin T монот чешел. manote Line Tohoku Joetsu Shinkanse Kanda Station Showa-Dori Yoshiyasu Kanda Bldg. Tokyo Metro Ginza Line Kanda Kanamono-Dori Shin-Nihombashi Station Express kyo Metro Toky Line Hibiya L Kodemmacho Station Edo-Dori JR Sobu Main Line MCUBS MidCity Investment Corporation#4242 Newly acquired assets - M-City Akasaka 1-chome Bldg. Property located in a one-minute walk from Tameike-Sanno Station, holding internal growth potential Key reasons for acquisition ✓ Located in a convenient area, accessible from a one-minute walk from the Tameike-Sanno Station ✓ Property expected the office tenants' demand as located in an area suitable for offices ✓ Located in Akasaka area in Minato-ku where is expected to enhance its appealing power as an office district, as more offices concentrate in this area after the completion of the large-scale redevelopment projects Property information/Surrounding environment Its location at a corner along the Roppongi-Dori gives high visibility Sponsor network • Accessible from several stations of Tokyo Metro Lines including Tokyo Metro Ginza Line as the useful business lines offering convenience • Located near government offices where the demands of variety companies including domestic and international are expected Location 1-11-28, Akasaka, Minato-ku, Tokyo Access one-minute walk from the Tameike-Sanno Station on the Tokyo Metro Ginza Line and Namboku Line MAP Tokyo Metro Marunouchi Line Kokkaigijido-mae Station Tokyo Metro Chiyoda Line Prime Minister's Official Residence Tameike-Sanno Station 13 Exit Namboku Line Tokyo Metro Metropolitan Expressway Cabinet Office Ministry of Financel Inner Circular Route Tokyo Metro Ginza Line Sotobori-Dori Toranomon Station M-City Akasaka 1-chome Bldg. Total land space 510.22m² Total floor space 3,308.20m² DOUT Structure/Floor SRC/10F Construction Completion Mar, 1985 Roppongi-Dori Toranomon Hospital ANA U.S. Embassy Tokyo InterContinental Tokyo Hotel Okura Tokyo Acquisition Price 4,205 mn. yen Roppongi-1tchome Station Acquisition Date Mar. 1, 2018 MCUBS MidCity Investment Corporation#4343 Newly acquired assets - USC Bldg. (Approx. 54% quasi co-ownership interest of trust beneficiary interest) Property acquired by exercise the preferential negotiation right. MCUBS MidCity gains ownership of the entire USC Bldg. Key reasons for acquisition Negotiation transaction Sponsor network Practical use of pipeline ✓ Potential tenants that attach importance to the convenience of vehicle use may also be attracted to this property since it secures 107 parking lots ✓ MCUBS MidCity gains ownership of the entire USC Bldg. through a pipeline property to be acquired ✓ MCUBS MidCity will enjoy the merit of asset value improvement and integrated management by gaining ownership of the entire USC Bldg. Property information/Surrounding environment Located along the Yotsume-Dori and can be found easily Apr, 2017: Acquisition of approx. 46% quasi co-ownership interest Feb, 2018: Additional acquisition of approx. 54% by exercise the preferential negotiation right High accessibility to a metropolitan area as located about seven minutes' walk from Toyocho Station Differentiated in terms of its size from other buildings in this area, many of which are mid- and small-sized buildings with the standard floor area of approximately 600 tsubo and characterized by the high-grade specifications MAP Location USCビル Access 4-11-38, Toyo, Koto-ku, Tokyo seven min by walk from Tokyo Metro Tozai Line Toyo-cho Station USC Bldg. Yokojyukengawa Water Park Total land space 4,565.21m² Kasaibashi-Dori Total floor space 18,506.16m² (including the annex building) Hotel East 21 Tokyo Main Building: S-SRC/B1F-8F Structure/Floor Annex: RC/1F Koto City Government Koto-ku Bunka Center Office Construction Completion Acquisition Price Acquisition Date Jan, 1990. and other 5,800 mn. yen (Total 10,800 mn. yen including 5,000 mn. yen, acquired prior to this additional acquisition) Feb. 16, 2018 (Apr. 6, 2017 (previous acquisition)) Fukagawa Post Office Eitai Dori Tokyo Metro Toyocho Station Tozai Line Koto Driver's License test site MCUBS MidCity Investment Corporation#4444 5. FINANCING STRATEGY MCUBS MidCity Investment Corporation#45Major financing-related figures and investment corporation bonds Changes in financing-related figures As of end of Jun. 2017 As of end of Dec. 2017 LTV (based on appraisal value) 43.0% 42.1% Ratio of long-term debts 100.0% 100.0% Ratio of fixed interest rate 77.4% 77.4% Average remaining years of debts 3.1 years 3.5 years Average interest rate on debts 1.09% 1.06% R&I: A (stable) Issuer rating (Oct. 26, 2016) R&I: A (stable) (Oct. 3, 2017) Investment corporation bonds Forecast for Mar. 2018 42.3% (Note 1) 100.0% 75.8% 3.6 years 1.01% (Note 2) Aim for further improvement Issuance Term Nominal Coupon Amount issued 1st Unsecured Investment Corporation Bond 2nd Unsecured Investment Corporation Bond May 2016 5 years 0.340% 1.5 bn. yen May 2016 10 years 0.810% 1.5 bn. yen 3rd Unsecured Investment Corporation Bond 4th Unsecured Investment Corporation Bond May 2017 5 years 0.260% 1.0 bn. yen May 2017 10 years 0.670% 2.0 bn. yen Total 6.0 bn. yen Note 1: Calculated in consideration of financing through the public offering, new borrowings and acquisition of four new properties, etc. since Jan. 2018, based on market capitalization as of the end of Dec. 31, 2017 Note 2: Calculated by dividing estimated financial costs for the fiscal period ending Jun. 2018 (24th Period) by estimated average debt balance for the same fiscal period 45 MCUBS MidCity Investment Corporation#4646 46 Financial status Average remaining years and average interest rate of debts (year) 5.0 Total assets and debts (100mn. yen) 3,000 4.5 4.0 60.0% Average remaining years of debts (Note 1) Average interest rate of debts (including debts-related expenses) (Note 2) 2.5% Total assets LTV(appraisal value base) (Note 3) Interest-bearing debt 2,720 LTV(book value base) (Note 4) ) 2,488 2,488 2,500 55.0% 52.5% 52.0% 2,260 2,276 2,259 1.85% 3.5 1.81% 1.54% 3.0 1.48% 1.42% 1.40% 1.38% 1.36% 2.5 1.22% 1.18% 1.17% 1.09% 1.06% 1.01% 2.0 1.0% 1,000 2.0% 2,000 1,763 1,765 1,754 1,737 1,741 1,689 1,687 1,688 50.0% 47.7% 49.8% 1.5% 1,500 47.2% 47.3% 49.0% 48.3% 46.6% 45.8% 44.6% 1,159 1,049 45.0% 1,049 43.0% 943 957 941 42.6% 42.1% 3.6years 1.5 2.1years 1.0 2.8years 3.2years 3.5years 720 719 718 716 655 654 653 676 3.1years 2.0years 1.6years 1.5years 0.5 2.4years 2.3years 1.9years 1.8years 2.7years 41.3% 40.8% 40.8% 40.9% 0.5% 500 42.0% 42.2% 41.7% 41.7% 42.2% 38.8% 38.8% 38.7% 38.9% 42.3% 40.0% 0.0 0.0% 0 Jun. Dec. Jun. Dec. 2011 2012 2012 2013 11th 12th 13th 14th Period Period Period Period Period Period Period Period Dec. Jun. Dec. 2013 2014 2014 15th 16th 17th Jun. 2015 18th Dec. Jun. Dec. Jun. 2015 2016 2016 2017 2017 19th 20th 21st 22nd 23rd Period Period Period Period Period Estimate Dec. Mar. Dec. Jun. Dec. Jun. 2018 2011 2012 11th 12th 2012 13th Period Period Period Period 35.0% Jun. Dec. Jun. Dec. 2014 17th 2015 2015 18th 19th Dec. 2013 2013 2014 14th 15th 16th Period Period Period Period Period Period Period Period Period Estimate Jun. Dec. Jun. Dec. Mar. 2016 2016 2017 2017 2018 20th 21st 22nd 23rd Note1: Average remaining years of debts is using the weighted average of remaining years of debts until maturity based on the respective balance of debts. Note2: Average interest rate of debts (including borrowing-related expenses) = Financing costs in each fiscal period / Average debt balance in the fiscal period. Note3: LTV (appraisal value base) = Term-end debts / (Term-end total assets ±Unrealized gain/loss). Unrealized gain/loss is the difference between book value and appraisal value Note4: LTV (book value base) = Term-end debts / Term-end total assets MCUBS MidCity Investment Corporation#47Lender composition and maturity ladder (as of end of Dec. 2017) Lender Lenders composition (Loans as of the end of Dec. 2017) | Balance (mn. Yen) A Mizuho Bank, Ltd. B Sumitomo Mitsui Trust Bank, Limited Share 17,600 17.8% 12,800 12.9% M N. OP QR C Sumitomo Mitsui Banking Corporation 12,800 12.9% D Development Bank of Japan, Inc. 12,325 12.5% K E Aozora Bank, Ltd. 10,050 10.2% A F Resona Bank, Limited 7,500 7.6% G Mitsubishi UFJ Trust and Banking Corporation 6,300 6.4% H The Bank of Tokyo-Mitsubishi UFJ, Ltd 4,500 4.5% I Shinkin Central Bank 4,200 4.2% G J The Senshu Ikeda Bank, Ltd. 3,050 3.1% B K The Nishi-Nippon City Bank, Ltd. 2,100 2.1% L Mizuho Trust & Banking Co., Ltd. 1,300 1.3% F M The Hyakugo Bank, Ltd. 1,150 1.2% N The Minato Bank, Limited 800 0.8% ヨ C ○ The Nanto Bank, Ltd. 500 0.5% P The Hiroshima Bank, Ltd. 500 0.5% QSony Bank Incorporated 500 0.5% R Tokio Marine & Nichido Fire Insurance Co., Ltd. 500 0.5% S Nippon Life Insurance Company 500 0.5% Diversified maturity ladder of debts (based on balance as of the end of Dec. 2017) Total 98,975 100.0% (mn. Yen) 25,000 20,000 15,000 Commitment Line 15.0 bn. yen Loans New loans Invest Co. Bonds 10,000 8,550 8,950 13,675 15,300 15,200 1,500 14,300 2,900 1,000 2,900 4,700 5,000 4,000 3,975 5,300 1,500 3,900 2,000 4,000 3,000 2,000 0 (Repayment date) Dec. 2017 Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 47 MCUBS MidCity Investment Corporation#4848 48 Outstanding borrowings (as of end of Dec. 2017) Development Bank of Japan Type Loan Term 7 years 5 years 7 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank Development Bank of Japan, Minato Bank 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Resona Bank 6 years Mizuho Bank, The Hiroshima Bank, Sony Bank 7 years Mizuho Bank, Aozora Bank 3 years Lenders Balance (mn. Yen) 1,700 Floating/ Fixed Fixed Interest Drawdown Repayment (Note 3) rate 4,800 Fixed (Note 2) 1.52375% 1.29700% date date (Note 4) 2012/7/31 2019/7/31 2013/7/31 2018/7/31 Repayment method Bullet payment Bullet payment 1,800 Fixed 4,000 Fixed (Note 2) 2,000 Fixed (Note 2) 1,800 1.70875% 2013/7/31 2020/7/31 Bullet payment Fixed 0.96200% 1.24000% 1.47806% 2014/7/31 2019/7/31 Bullet payment 2014/7/31 2020/7/31 Bullet payment 2014/7/31 2021/7/31 Bullet payment 4 years 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank, Resona Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank, The Bank of Tokyo-Mitsubishi UFJ, Nishi-Nippon City Bank, Mizuho Trust & Banking, Hyakugo Bank Mizuho Bank, Sumitomo Mitsui Banking, Resona Bank, Mitsubishi UFJ Trust and Banking, Shinkin Central Bank, Senshu Ikeda Bank, The Nanto Bank Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank, Resona Bank, Mitsubishi UFJ Trust and Banking, The Bank of Tokyo-Mitsubishi UFJ, Mizuho Trust & Banking 10,500 Floating 0.46727% 2015/7/31 2018/7/31 Bullet payment 9,500 Floating 0.56727% 2015/7/31 2019/7/31 Bullet payment 9,300 Fixed (Note 2) 0.86545% 2015/7/31 2020/7/31 Bullet payment 1,200 Fixed 5 years Development Bank of Japan 6 years 7 years Mizuho Bank, Sumitomo Mitsui Banking, Resona Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank Mizuho Bank, Aozora Bank, The Bank of Tokyo-Mitsubishi UFJ, Mizuho Trust & Banking 4,500 Fixed (Note 2) 2,200 Fixed (Note 2) 800 Fixed 0.90750% 1.03350% 1.20235% 1.23250% 7 years Development Bank of Japan Long term loans payable 8 years Mizuho Bank 8 years Mizuho Bank 1,000 Fixed (Note 2) 500 Fixed (Note 2) (Note 1) 8 years 5 years 3.5 years 3.5 years 3.5 years Development Bank of Japan Sumitomo Mitsui Banking, Shinkin Central Bank Nishi-Nippon City Bank, Hyakugo Bank Sumitomo Mitsui Trust Bank 500 Fixed Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking 2,800 Fixed (Note 2) 3,700 Floating 2,250 Fixed 2,600 Fixed 4.5 years 5 years Mizuho Bank, Development Bank of Japan, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank Development Bank of Japan, Aozora Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank 2,500 Fixed 2,650 Fixed 2015/7/31 2020/7/31 2015/7/31 2015/7/31 2015/7/31 2022/7/31 1.38430% 2015/7/31 2023/7/31 1.38430% 2015/7/31 2023/7/31 1.40000% 2015/7/31 2023/7/31 0.49795% 2016/4/28 2021/4/30 0.37727% 2016/7/29 2020/1/31 0.37315% 2016/7/29 2020/1/31 0.37315% 2016/7/29 2020/1/31 0.45065% 2016/7/29 2021/1/31 0.49380% 2016/7/29 2021/7/31 Bullet payment 2021/7/31 2022/7/31 Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment 8 years Mizuho Bank, Development Bank of Japan, Aozora Bank, Mitsubishi UFJ Trust and Banking 4,700 Fixed 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Development Bank of Japan, The Bank of Tokyo-Mitsubishi UFJ 4,000 Fixed 0.73500% 2016/7/29 2024/7/31 0.64691% Bullet payment 2017/1/31 2022/1/31 Bullet payment 7 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Development Bank of Japan, The Bank of Tokyo-Mitsubishi UFJ 4,000 Fixed 0.80938% 2017/1/31 2024/1/31 Bullet payment 5 years Sumitomo Mitsui Trust Bank, Tokio Marine & Nichido Fire Insurance, Nippon Life Insurance Company 2,900 Fixed 0.52420% 2017/7/31 2022/7/29 Bullet payment 6 years Shinkin Central Bank, Senshu Ikeda Bank 1,900 Fixed 0.68000% 2017/7/31 2023/7/31 Bullet payment 1,000 Fixed 6 years Sumitomo Mitsui Banking 8 years Mizuho Bank, Development Bank of Japan 3,975 Fixed 10 years Mizuho Bank, Development Bank of Japan, Aozora Bank 3,900 Fixed 0.68792% 2017/7/31 0.85630% 2017/7/31 2025/7/31 1.04000% 2017/7/31 2027/7/31 2023/7/31 Bullet payment Bullet payment Bullet payment 98,975 Total Note 1: Syndicated loans by the indicated financial institutions. Note 2: Interest rate swaps are concluded to fix the interest rates. Note 3: Interest rate is applied as of end of Dec. 2017. Note 4: If such date does not fall on any business day, the next business day shall be applied. If such next business day is included in the next month, the business day immediately preceding the initial repayment date shall be applied. MCUBS MidCity Investment Corporation#49Lender composition and maturity ladder (Estimate for Mar. 2018) Lenders composition (Estimate for Mar. 2018) M NORR S T F A C E Lender Balance (mn. Yen) A Mizuho Bank, Ltd. Share 21,100 19.2% B Sumitomo Mitsui Trust Bank, Limited 14,000 12.7% C Sumitomo Mitsui Banking Corporation 14,000 12.7% D Development Bank of Japan, Inc. 13,525 12.3% E Aozora Bank, Ltd. 10,950 10.0% F Resona Bank, Limited 7,500 6.8% G Mitsubishi UFJ Trust and Banking Corporation 6,300 5.7% H The Bank of Tokyo-Mitsubishi UFJ, Ltd 5,700 5.2% Shinkin Central Bank 4,200 3.8% J The Senshu Ikeda Bank, Ltd. 3,050 2.8% K The Nishi-Nippon City Bank, Ltd. 3,000 2.7% B L Mizuho Trust & Banking Co., Ltd. 1,300 1.2% M The Hyakugo Bank, Ltd. 1,150 1.0% NEW N The Bank of Fukuoka, Ltd. 900 0.8% The Minato Bank, Limited 800 0.7% P The Nanto Bank, Ltd. 500 0.5% The Hiroshima Bank, Ltd. 500 0.5% R Sony Bank Incorporated 500 0.5% S Tokio Marine & Nichido Fire Insurance Co., Ltd. 500 0.5% T Nippon Life Insurance Company 500 0.5% Total 109,975 100.0% Diversified Maturity Ladder of debts (Estimate for Mar. 2018) (mn. Yen). 25,000 20,000 15,300 15,200 15,000 10,000 5,000 8,550 14,300 l.lil 2,000 0 Jun. Dec. Jun. (Repayment- date) 2018 49 2019 Dec. Jun. 2020 Commitment Line 15.0 bn. yen Loans New loans Invest Co. Bonds 8,950 1,500 1,000 5,900 4,900 4,000 4,700 3,900 3,975 2,700 3,900- 2,400 2,000 5,300 4,000 1,500 Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. Jun. Dec. 2021 2022 2023 2024 2025 2026 2027 MCUBS MidCity Investment Corporation#5050 Outstanding borrowings (Estimate for Mar. 2018) Туре Loan Term Lenders Balance (mn. Yen) Floating/ Fixed 7 years Development Bank of Japan 1,700 Fixed Interest rate (Note 3) 1.52375% 5 years 7 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank Development Bank of Japan, Minato Bank 4,800 Fixed (Note 2) 1.29700% Drawdown date 2012/7/31 2013/7/31 Repayment date (Note 4) Repayment method 1,800 Fixed 1.70875% 2013/7/31 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Resona Bank 4,000 Fixed (Note 2) 0.96200% 2014/7/31 6 years Mizuho Bank, The Hiroshima Bank, Sony Bank 2,000 Fixed (Note 2) 1.24000% 2014/7/31 7 years Mizuho Bank, Aozora Bank 1,800 Fixed 1.47806% 2014/7/31 3 years 4 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank, Resona Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank, The Bank of Tokyo-Mitsubishi UFJ, Nishi-Nippon City Bank, Mizuho Trust & Banking, Mizuho Bank, Sumitomo Mitsui Banking, Resona Bank, Mitsubishi UFJ Trust and Banking, Shinkin Central Bank, Senshu Ikeda Bank, The Nanto Bank 10,500 Floating 0.46727% 2015/7/31 2019/7/31 2018/7/31 2020/7/31 2019/7/31 2020/7/31 2021/7/31 2018/7/31 Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment 9,500 Floating 0.56727% 2015/7/31 2019/7/31 Bullet payment 5 years 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Aozora Bank, Resona Bank, Mitsubishi UFJ Trust and Banking, The Bank of Tokyo-Mitsubishi UFJ, Mizuho Trust & Banking Development Bank of Japan 9,300 Fixed (Note 2) 0.86545% 2015/7/31 1,200 Fixed 0.90750% 2015/7/31 6 years 7 years Mizuho Bank, Sumitomo Mitsui Banking, Resona Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank Mizuho Bank, Aozora Bank, The Bank of Tokyo-Mitsubishi UFJ, Mizuho Trust & Banking 4,500 Fixed (Note 2) 1.03350% 2015/7/31 2,200 Fixed (Note 2) 1.20235% 2015/7/31 7 years Development Bank of Japan 800 Fixed 1.23250% 2015/7/31 8 years Mizuho Bank 1,000 Fixed (Note 2) 1.38430% 2015/7/31 2020/7/31 2020/7/31 2021/7/31 2022/7/31 2022/7/31 2023/7/31 Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment 8 years Mizuho Bank 500 Fixed (Note 2) 1.38430% 2015/7/31 8 years Long term loans 5 years payable (Note 1) 3.5 years 3.5 years 3.5 years Development Bank of Japan Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking. Sumitomo Mitsui Banking, Shinkin Central Bank Nishi-Nippon City Bank, Hyakugo Bank Sumitomo Mitsui Trust Bank 500 Fixed 1.40000% 2015/7/31 2,800 Fixed (Note 2) 0.49795% 2016/4/28 3,700 Floating 0.37727% 2016/7/29 2,250 Fixed 0.37315% 2016/7/29 2,600 Fixed 0.37315% 2016/7/29 4.5 years 5 years Mizuho Bank, Development Bank of Japan, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank Development Bank of Japan, Aozora Bank, Mitsubishi UFJ Trust and Banking, Senshu Ikeda Bank 2,500 Fixed 0.45065% 2,650 Fixed 0.49380% 8 years. Mizuho Bank, Development Bank of Japan, Aozora Bank, Mitsubishi UFJ Trust and Banking 4,700 Fixed 0.73500% 2016/7/29 2016/7/29 2016/7/29 5 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Development Bank of Japan, The Bank of Tokyo- Mitsubishi UFJ 4,000 Fixed 0.64691% 2017/1/31 2023/7/31 2023/7/31 2021/4/30 2020/1/31 2020/1/31 2020/1/31 2021/1/31 2021/7/31 2024/7/31 2022/1/31 Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment 7 years Mizuho Bank, Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking, Development Bank of Japan, The Bank of Tokyo- Mitsubishi UFJ 4,000 Fixed 0.80938% 2017/1/31 2024/1/31 Bullet payment 5 years Sumitomo Mitsui Trust Bank, Tokio Marine & Nichido Fire Insurance, Nippon Life Insurance Company 2,900 Fixed 0.52420% 2017/7/31 6 years Shinkin Central Bank, Senshu Ikeda Bank 1,900 Fixed 0.68000% 2017/7/31 6 years Sumitomo Mitsui Banking 1,000 Fixed 0.68792% 2017/7/31 8 years Mizuho Bank, Development Bank of Japan 3,975 Fixed 0.85630% 2017/7/31 10 years Mizuho Bank, Development Bank of Japan, Aozora Bank 3,900 Fixed 1.04000% 2017/7/31 NEW 1 years Mizuho Bank 2,000 Floating Undecided (Note5) NEW 5 years Sumitomo Mitsui Trust Bank, Sumitomo Mitsui Banking 2,400 Floating NEW 7 years The Bank of Tokyo-Mitsubishi UFJ 1,200 Fixed NEW NEW 7 years 8 years Aozora Bank, Nishi-Nippon City Bank, THE BANK OF FUKUOKA Mizuho Bank, Development Bank of Japan 2,700 Fixed 2,700 Fixed Undecided (Note5) Undecided (Note5) Undecided (Note5) Undecided (Note5) 2018/2/28 2018/2/28 2018/2/28 2018/2/28 2018/2/28 2022/7/29 2023/7/31 2023/7/31 2025/7/31 2027/7/31 2019/2/28 2023/2/28 2025/2/28 2025/2/28 2026/2/27 Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Bullet payment Total 109,975 Note 1: Syndicated loans by the indicated financial institutions. Note 2: Interest rate swaps are concluded to fix the interest rates. Note 3: Interest rate is applied as of end of Jan. 2018. Note 4: If such date does not fall on any business day, the next business day shall be applied. If such next business day is included in the next month, the business day immediately preceding the initial repayment date shall be applied. Note 5: Interest rates are determined before each loan is provided, based on the respective loan agreements executed on Jan. 29, 2018 MCUBS MidCity Investment Corporation#5151 (This page is left blank intentionally) MCUBS MidCity Investment Corporation#526. MARKET ENVIRONMENT 52 52 MCUBS MidCity Investment Corporation#5353 Office market data 1 (Tokyo 23 districts) Average rent and vacancy rate of Tokyo (yen/tsubo) 55,000 45,000 35,000 25,000 15,000 5,000 05Q1 05Q2 05Q3 05Q4 06Q1 06Q2 06Q3 06Q4 IOLO 07Q2 07Q3 07Q4 08Q1 08Q2 08Q3 08Q4 09Q1 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1 11Q2 11Q3 11Q4 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 Rent in Grade A Vacancy Rate in Grade A Rent in Grade A- Vacancy Rate in Grade A- 14Q2 14Q3 14Q4 15Q1 15Q2 15Q3 15Q4 16Q1 16Q2 16Q3 16Q4 17Q1 Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. 17Q2 17Q3 17Q4 MCUBS MidCity Investment Corporation Rent in Grade B Vacancy Rate in Grade B 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% ov do do 0%#54Office market data 2 (Tokyo 23 districts) 54 54 Supply and demand of Tokyo (tsubo) 350,000 300,000 250,000 200,000 150,000 100,000 50,000 New supply New demand 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 (E) (E) 2019 2020 2021 2022 (E) (E) (E) Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. MCUBS MidCity Investment Corporation#5555 Office market data 3 (Osaka) Average rent and vacancy rate of Osaka business districts (yen/tsubo) 25,000 20,000 15,000 10,000 5,000 05Q1 05Q2 05Q3 05Q4 06Q1 06Q2 06Q3 06Q4 07Q1 07Q2 07Q3 07Q4 ID80 08Q2 08Q3 Rent in Grade A ---Vacancy Rate in Grade A Rent in Grade B -Vacancy Rate in Grade B Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. 08Q4 09Q1 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1 11Q3 1104 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 14Q3 14Q4 15Q1 g15Q2 15Q3 15Q4 16Q1 16Q2 16Q3 16Q4 17Q1 17Q2 17Q3 17Q4 MCUBS MidCity Investment Corporation 20% 18% 16% 14% 12% 10% 2% 0% do olo olo do glo 8% 6% 4%#5656 Office market data 4 (Osaka) Supply and demand of Osaka business districts (tsubo) 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 New supply New demand 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 (E) (E) (E) Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. MCUBS MidCity Investment Corporation#5757 Office market data 5 (Nagoya) Average rent and vacancy rate of Tokyo (yen/tsubo) 30,000 25,000 20,000 15,000 10,000 5,000 05Q1 05Q2 05Q3 05Q4 06Q1 06Q2 06Q3 06Q4 07Q1 07Q2 07Q3 07Q4 08Q1 08Q2 08Q3 08Q4 IO60 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1 11Q2 11Q3 11Q4 12Q1 12Q2 12Q3 12Q4 13Q1 13Q2 13Q3 13Q4 14Q1 14Q2 14Q3 Rent in Grade A Vacancy Rate in Grade A Rent in Grade B Vacancy Rate in Grade B 14Q4 15Q1 15Q2 15Q3 15Q4 16Q1 16Q2 16Q3 16Q4 17Q1 17Q2 17Q3 17Q4 Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. MCUBS MidCity Investment Corporation 18% 16% 14% 12% 10% 8% 6% 4% 2% 0%#5858 Office market data 6 (Nagoya) Supply and demand of Nagoya business districts (tsubo) 60,000 50,000 40,000 30,000 20,000 10,000 New supply New demand 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 (E) (E) (E) Source: Prepared by the Asset Manager based on the data obtained from CBRE K.K. MCUBS MidCity Investment Corporation#597. OVERVIEW OF MCUBS MIDCITY 59 59 MCUBS MidCity Investment Corporation#60Overview of MCUBS MidCity Investment Corporation 60 60 THE Mitsubishi Corporation UBS KANSAI ELECTRIC POWER CO. INC MID REIT, Inc. 2005 MID Urban Development Co., Ltd. solely established MID REIT Management Co. Main sponsor Think bold today for a brighter tomorrow. ||||| MC-UBS GROU P Mitsubishi Corp UBS Realty Sub sponsor ← 人に、街に、明るい未来を _関電不動産開発 Kanden Realty & Development Co., Ltd. Former trade name Sep. Ltd. 2006 MID REIT, Inc. listed Aug. MID Urban Development Co., Ltd. } Investment ratio 65.0% Investment ratio 35.0% 2009 Asset manager MCUBS MidCity Inc. Asset management agreement The Kansai Electric Power Company, Incorporated became the largest Dec. shareholder of MID Urban Development Co., Ltd. MCUBS MidCity Investment Corporation Former trade name MID REIT Management Co., Ltd. 2015 Apr. Mitsubishi Corp.-UBS Realty Inc. acquired 65% of interest in MID REIT Management Co., Ltd. and the asset management firm was renamed to MCUBS MidCity Inc. 2015 Former trade name MID REIT, Inc. Jun. The trade name of MID REIT Inc. was changed to MCUBS MidCity Investment Corporation Investment corporation MCUBS MidCity Investment Corporation MCUBS MidCity Investment Corporation#6119 61 Characteristics of MCUBS MidCity Investment Corporation Target areas: Expand from "Osaka area" to "three major metropolitan areas (Tokyo, Osaka and Nagoya) (Note)" Target properties (asset type): focus on "Office Buildings" Consider investing in overseas properties Targeted investment regions Three major metropolitan areas Investment Rate 70% or more Government-designated cities and other major cities as well as abroad, excluding the three major metropolitan areas 30% or less Туре Office Investment Rate 70% or more * ex. commercial facilities and industrial real estate Real estate other than office properties 30% or less Note: Tokyo metropolitan area includes Tokyo, Kanagawa, Chiba and Saitama; Osaka metropolitan includes Osaka, Kyoto and Hyogo; and Nagoya metropolitan includes Aichi. MCUBS MidCity Investment Corporation III III#62Medium-term portfolio strategy Asset size and tenant composition < Tenant composition (based on rent and CAM revenues) > Largest tenant 21.2% Largest tenant 14.9% Largest tenant 13.8% Largest tenant 12.7% Largest tenant 10% or less 2000. OBP 62.4% OBP 44.8% OBP 41.0% OBP 37.8% < Asset size (based on acquisition price) > No. of properties 217.1 bn. yen 157.6 bn. yen 12 19 238.1 bn. yen 20 Dec. 2014 17th Period Dec. 2015 19th Period Dec. 2017 23rd Period 261.3 bn. yen OBP 30% or less 300 bn. yen H 23 Mar. 2018 62 62 MCUBS MidCity Investment Corporation#6363 Advantage of various property information networks Property acquisition route Main Sponsor Group Think bold today for a brighter tomorrow. ||||| MC-UBS GROUP Mitsubishi Corp UBS Realty Mitsubishi Corporation UBS 人に、街に、明るい未来を Sub 関電不動産開発 Sponsor Kanden Realty & Development Co.,Ltd. Ownership/ development (Seller: sponsor) Property acquisition method Market transaction (Seller: third party/sponsor) Negotiated transaction / CRE proposal (Seller: third party) Sumitomo Fudosan Ueno Bldg. No.6 G-Square Shibuya Dogenzaka Cube Kawasaki Higashi- Nihombashi Green Building Nagoya Lucent Tower (Slient partnership interest) Sendai Capital Tower Shibuya Sakuragaoka Square Sasazuka Center Bldg. Yoshiyasu Kanda Bldg. M-City Akasaka 1-chome Bldg. SSP Bldg. USC Bldg. New Yokohama Creation Square (Reference) Potential market size of office buildings owned by business companies Source: Ministry of Land, Infrastructure, Transport and Tourism: Asset amount by present usage of buildings owned by companies (2013) Welfare facility: 1.0 tn. yen (1.1%) Religious facility: 2.6 tn. yen (3.0%) Hotel, Inn: 3.5 tn. yen (4.0%) Warehouse: 4.5 tn. yen (5.1%) Others, Unknown: 12.9 tn. yen (14.5%) Educational facility: 8.5 tn. yen (9.6%) Residence: 8.9 tn. yen (10.1%) -Office: 20.4 tn. yen (23.0%) Retail facility: 13.4 tn. yen (15.1%) Factory: 12.7 tn. yen (14.3%) MCUBS MidCity Investment Corporation#6419 64 Selective acquisitions by leveraging sponsor's expertise Think bold today for a brighter tomorrow. |||| MC-UBS GROUP Mitsubishi Corp UBS Realty 人に、街に、明るい未来を 関電不動産開発 Kanden Realty & Development Co., Ltd. Make use of its supporting capacity in Make use of its supporting capacity in providing properties information, making CRE proposals, etc. providing properties information, warehousing and other services Total No. of properties the information of which was provided by sponsors: 1,035 (total of the past 8 quarters) 168 151 116 112 68 158 140 122 2016 2016 2016 2016 2017 2017 2017 2017 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q MCUBS MidCity Investment Corporation#65Initiatives for sustainability Policy for sustainability MCUBS MidCity, together with its asset management company, MCUBS MidCity Inc., continues to make consideration to ESG (Environment, Social, Governance) PFA21 Principles for Financial Action for the 21st Century Signatory of: PRI Principles for Responsible Investment Evaluation and certification by external organizations GRESB The following actions are implemented by Asset Management Company Set up "Environmental Charter" Set up "Basic Policy for Responsible Property Investment" Sign on "Principles for Financial Action towards a Sustainable Society (Principles for Financial Action for the 21st Century)" Support for UNHCR Actions implemented by the main sponsor, Mitsubishi Corp.-UBS Realty Sign on the Principles for Responsible Investment (PRI) Sign on the Montreal Carbon Pledge Sign on the UNEP Finance Initiative (UNEP FI) Sign on the UN Global Compact (UN GC) BELS Certification BELS MCUBS MidCity received the highest grade "Green Star" for two consecutive Three Star Certification MCUBS MidCity received the certification for years in 2017, and was awarded Four Stars at GRESB Rating GRES B the first time in December 2016, with three stars * 2017 DBJ Green Building Certification Four Star Certification Four properties were certified as four stars as properties with high environmental and social awareness •Twin 21 ⚫Matsushita IMP Bldg. . ■ Kitahama MID Bldg. Higobashi MID Bldg. DBJ Green Building 2016 323 given to one of the portfolio properties ★★★ Kitahama MID Bldg. ⚫G-Square Shibuya Dogenzaka ⚫Higobashi MID Bldg. CASBEE Property Appraisal Appraisal of Rank A Two properties were certified for their environmental performances ⚫G-Square Shibuya Dogenzaka ⚫Higobashi MID Bldg. この建物のエネルギー消費量 24%削減 2016年12月27日付 国土交通省告示に基づく第三者証 建築物總合環境性能評価認証票 CASBEE 既存 2013年7月 G SQUARE 250 ||| 株式会社ERIソリューション 65 55 MCUBS MidCity Investment Corporation#6699 66 Establishment of Disclosure Regime Renewal of website The company website was completed renewed in Jun. 2016 to make it user-friendly. http://www.midcity-reit.com/en/ 今 |||| MC-UBS MCUBS MidCity 投資法人 について しみ 不動産ポートフォリオ IRE ▼ サステナビリティ よくある質問 リンク について 最新データ コード 3227 保有物件数 20件 文字 Japanese Engest IMC-UBS お問い合わせ・資料請求 サイトマップ MOURS MidCity MIRA TOKYO 確かな今を、豊かな明日へ。 ||||||| MC-UBS MCUBS MidCity 投資法人 最新データコード 3227 証券コード 3227 こちら [Yhall ファイナンス W ファイナンス 夢率 取辦鐵告合計 口当たり分配 97.3% 238,144 21期実績 22 予 7,431円 7,900円 8,000円) 2017年05月31日 0105R31) - トピックス (2017405) 2017年07月18日 2017年6月期(第22期) 決算スケジュール | MCUBS MidCity投資法人からのお知らせ RSS お知らせ更新一覧 PR ニュース Awards TOP page 保有物件数 20 移動率 97.3% (2013年5月3 MC-UBS MCUBS MidGty 投資法人 人につ ポートフォリオマップ 人のしくみ NOVE ポートフリーポートフォリオマッ 不動産ポートフォリオ ・ポートフォリオマップ ・ポートフォリオ一覧・ 東京圏 大阪酒 名古屋 ・ポートフォリオ ポートフォリオデータ ,證件褟介布真萬 サステナビリティ 模 お問い合わせ サイトマップ よくある質 価格合計 口当たり分配金 238,144 21期 7,431円 百万円 2205 7,900円 リンク素 について 23期 8,000円 (2017031) 総件数 テナント数 総地価格 20 391 238,144 97.3% | MCUBS MidCity投資法人からのお知らせ Mobile site Portfolio map Website Quality Ranking Survey among All Listed Companies in Japan (Conducted by Nikko Investor Relations Co., Ltd.) FY2016 Candidates: 3,688 listed companies ★ AA Website (156th place overall) ★ AA Website (5th place REIT) FY2017 Candidates: 3,713 listed companies ★ AAA Website (42th place overall) ★ AA Website (2nd place REIT) 企業ホームページ 最優秀サイト 2017 日興アイ・アール 総合ランキング MCUBS MidCity Investment Corporation#6767 Overseas Property Investment Decided NOT to invest in overseas properties What we did • Detailed examination in potential investments in office properties outside Japan • Verification of a potential investment scheme from legal, tax and accounting perspectives • Identification of potential investment targets and their economics What we found Confirmation on that a scheme of investments would be available • Confirmation on that it would be possible to make investments to improve portfolio profitability with increasing distributions . Opinion saying that such investments would not contribute to MCUBS MidCity's growth as additional premiums would be required to address risks related to currencies, regulations and markets Overseas Property Investment Policy Decided NOT to invest in overseas properties in the foreseeable future • Took account of a potential risk that additional risk premiums with overseas investment may hinder the growth of unitholders' value • MCUBS MidCity is to focus on unitholders' value creation through domestic property portfolio management • May reconsider the option in the future based on discussions with investors when the risk tolerance get higher after the asset size expansion MCUBS MidCity Investment Corporation#68Unitholder details No. of unitholders Breakdown by unitholder type (based on no. of units held) 14,000 End of 19th Period (266,025 units) 59.0% (54.3%) 8.0% 12.2% 20.8% 12,517 12,267 11,665 11,604 11,451 End of 20th Period (266,025 units) 58.0% (51.5%) 7.3% 15.8% 18.8% 12,000 End of 21st Period (266,025 units) 56.8% (47.4%) 7.5% 16.9% 18.8% 10,000 Dec. 2015 Jun. 2016 End of 19th End of 20th Period Period Dec. 2016 End of 21st Period Jun. 2017 End of 22nd Period Dec. 2017 End of 23rd End of 22nd Period (296,625 units) End of 23rd Period 56.8% (45.7%) 7.3% 18.4% 17.5% 54.8% (44.8%) 7.1% 21.8% Period (296,625 units) Financial institutions (Trust banks out of the financial institutions) Other domestic corporations Foreign 16.3% Individuals corporations Major unitholders Dec. 2017 (End of 23rd Period) Rank Name 1 Japan Trustee Services Bank, Ltd. (Trust Account) 2 The Master Trust Bank of Japan, Ltd. (Trust Account) 3 Trust & Custody Services Bank, Ltd. (Securities Investment Trust Account) 4 The Nomura Trust and Banking Co., Ltd. (Investment Trust Account) 5 Kanden Realty & Development Co.,Ltd. 6 SIX SIS LTD. 7 THE BANK OF NEW YORK, NON-TREATY JASDEC ACCOUNT 8 STATE STREET BANK AND TRUST COMPANY 505012 9 Mitsubishi Corporation 10 DFA INTERNATIONAL REAL ESTATE SECURITIES PORTFOLIO No. of units held Share (%) Difference from 22nd Period End 55,856 18.83% 42,175 14.21% - 1,680 + 7,279 17,078 5.75% 12,892 4.34% 9,200 3.10% - 9,094 +799 0 8,255 2.78% - 590 6,624 2.23% + 2,512 5,321 1.79% + 2,690 4,200 1.41% 0 3,861 1.30% + 194 Total 165,462 55.78% Note: Ratio of number of units owned to total number of units issued is calculated by rounding to the nearest second decimal place. 68 88 MCUBS MidCity Investment Corporation#69Overview of asset management company 69 69 Company overview (as of Feb. 21, 2018) Name MCUBS MidCity Inc. 2-7-3 Marunouchi, Chiyoda-ku, Tokyo Location Establishment Sep. 1, 2005 Capital 210 mn. yen Shareholders Mitsubishi Corp. - UBS Realty Inc. :65% Kanden Realty & Development Co., Ltd. : 35% No. of employees 24 President & CEO & Representative Director Toyota Watanabe Deputy President & Representative Director Naoki Suzuki Structure (as of Feb. 21, 2018) Corporate Auditor Shareholder Meeting Compliance Committee Managing Director General Manager, Asset Management Department Officers Director (part time) Director (part time) Corporate Auditor (part time) Noriyuki Iijima Toru Tsuji (President & CEO & Representative Director of Mitsubishi Corp.-UBS Realty Inc.) Takanobu Yoshimoto (Deputy President & Representative Director of Mitsubishi Corp.-UBS Realty Inc.) Yushi Kamatani (Executive Director, Mitsubishi Corp.-UBS Realty Inc.) Internal Audit Office Compliance Office Shuji Isone Corporate Auditor (part time) (Corporate Auditor (full time), Mitsubishi Corp.-UBS Realty Inc.) Board of Directors Representative Director Investment Committee Business Administration Department Department Planning & Coordination Acquisition Department Asset Management Department Osaka Office MCUBS MidCity Investment Corporation#70Historical unit price 8,000 6,000 4,000 2,000 Unit price and trading volume for the past year (Trading volume, Unit) 342,000 yen (Jan. 4) Feb. 14, 2017 Earnings announcement 21st period 0 Jan. 2017 Feb. 150 100 50 0 -50 -100 Mar. Apr. May Aug. 15, 2017 Earnings announcement 22nd Period (Price, thousand yen) 400 Unit price Trading volume 350 375,000 yen (Dec. 29) 300 250 Jun. Jul. Aug. Sep. Oct. Nov. Dec. (Index (Note)) Indexed unit price after listing (Apr. 10, 2015 to Dec. 29, 2017) 2015 2016 Note: TSE REIT Index, JGB 10yr yield and MCUBS MidCity's unit price are indexed to 100, as at the price on Apr. 10 2015 70 MCUBS MidCity JGB 10yr yield TSE REIT Index 2017 Source: Thomson Reuters MCUBS MidCity Investment Corporation#71Think bold today for a brighter tomorrow. |||| MC-UBS GROUP MCUBS MidCity Investment Corporation Disclaimer This material main contain forward-looking statements regarding results, plans, managerial targets and strategies. These forward-looking statements are based on current assumptions and preconditions for future events and trends of business circumstances, which are not necessarily correct. Actual results may vary widely from such statements according to various factors This material is prepared subject to the accounting principles generally accepted in Japan, unless otherwise stated This material is about analyses of financial results of MCUBS MidCity Investment Corporation (the "Investment Corporation"), and is not prepared for the purpose of inducement or invitation for any acquisition of investment securities of the Investment Corporation nor any execution of other financial transaction contracts. Investment decisions are to be made at investors' sole discretion and responsibility The Investment Corporation is a publicly-offered real estate investment corporation (J-REIT) investing in real estate and related assets the prices of which may fluctuate. Unitholders of the Investment Corporation may suffer loss when unit prices decline in the market or an amount of distributions declines, according to economic and interest rate circumstances, a balance of supply and demand for units, real estate market environment, fluctuations of prices of, and rent revenues from real estate properties under management, disasters, aggravation of financial status of the Investment Corporation and other reasons. For detail, please see "Investment Risk" stated in the Securities Registration Statement (offering circular) and the Securities Report of the Investment Corporation. Asset Management Company: MCUBS MidCity Inc. (Certified Financial Instruments Business Operator: Director of Kanto Local Financial Bureau (Kinsho) Registration No. 2888, and Member of The Investment Trusts Association, Japan)