PRESS RELEASE. Office Rent Index for Q (Jan Mar) Office Rent Index

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1 PRESS RELEASE Sanko Estate Co., Ltd. Ginza Sanwa Bldg. --1 Ginza, Chuo-ku Tokyo, Japan -1 TOKYO, May 11 Sanko Estate NLI Research Institute release for Q1 1 (Jan Mar) Sanko Estate announces Q1 1 of Class A, B and C* in central Tokyo**. This innovative index, developed jointly with NLI Research Institute, is based on the contracted rent instead of the asking rent which is commonly referred to monitor market trend. for Q1 1 (Jan Mar) Class A (excluding CAM***) 35,13 yen/tsubo Q-O-Q 1 yen/tsubo 1. % Q-O-Q +/- points Class B (excluding CAM), yen/tsubo Q-O-Q yen/tsubo 1. % Q-O-Q.1 points Class C (excluding CAM) 1,1 yen/tsubo Q-O-Q 3 yen/tsubo 1. % Q-O-Q.3 points This release data (PDF) of is available on; (English) (Japanese) Summary for Q1 1 Class A office rent in central Tokyo surpasses 35, yen/tsubo for the first time in ten quarters. Class B office rent goes up and down around, yen/tsubo for five consecutive quarters. Class C office rent exceeds 1, yen/tsubo for the first time in three quarters. Methodology * Class A, B and C: Refer each guideline on page, 3 and respectively ** Central Tokyo: Tokyo Central 5 Wards and major business districts in surrounding areas ***CAM: Common Area Maintenance fee is constructed on the bases of contracted rent data collected by Sanko Estate. NLI Research Institute receives the anonymous data excluding detailed address and applies statistical analysis, the multi-variable hedonic regression modeling. Sanko Estate releases monthly rent (JPY/tsubo) and its Y-O-Y change every quarter by three building categories namely Class A, Class B and Class C. For further information, please contact: International Department, Sanko Estate Co., Ltd. Tel: , Fax: contact@sanko-e.co.jp PRAP Japan, Inc. ka-shibata@prap.co.jp, e-yonezu@prap.co.jp

2 Central Tokyo Class A Office and 1 5, 1 5,, 35, 3, 5,, 15, 'Q1 '3Q1 'Q1 '5Q1 'Q1 '7Q1 'Q1 '9Q1 'Q1 '11Q1 '1Q1 '13Q1 '1Q1 '15Q1 '1Q1 '17Q1 '1Q1 Class A '15Q1 '15Q '15Q3 '15Q '1Q1 '1Q '1Q3 '1Q '17Q1 '17Q '17Q3 '17Q '1Q1 (JPY/tsubo) 31,1 33,39 35,5 3,7 33,995 31,3 33,73 33,75 33,39 3,755 3,1 3,599 35,13 (%) Source: Sanko Estate ( Rate), Sanko Estate NLI Research Institute (Office ) Central Tokyo Class A office rent increases by 1 yen/tsubo from the previous quarter to 35,13 yen/tsubo (excluding CAM), and surpasses 35, yen/tsubo for the first time in ten quarters. It increases at modest pace for two consecutive quarters while the demand-and-supply balance is further tightening. Market is now focusing if the rent might surpass the latest peak recorded in Q3 15 at 35,5 yen/tsubo. Pent-up demand for office is spilling into under-construction buildings, but the rent has not yet responded accordingly. Class A office vacancy rate levels off at 1.% after three consecutive Q-O-Q declines, and has remained below % since Q 7. Relatively new buildings as well as under-construction ones are constantly attracting strong demand. The number of workers is reaching the record high and boosting the office demand further largely due to the increase of female and senior workers. Class A office guidelines Subject areas: Tokyo Central 5 Wards and major business districts in surrounding areas (such as Osaki, Meguro, and Iidabashi) Total floor area:, tsubo or larger / Area per standard floor: 3 tsubo or larger Years since construction: 15 years maximum, while major refurbishment is also considered. Facilities (as a general rule): Ceiling height.7m or more, individual air conditioning, high anti-seismic and environmental performance

3 Central Tokyo Class B Office and 35, 3, 5,, 15,, 'Q1 '3Q1 'Q1 '5Q1 'Q1 '7Q1 'Q1 '9Q1 'Q1 '11Q1 '1Q1 '13Q1 '1Q1 '15Q1 '1Q1 '17Q1 '1Q1 Class B '15Q1 '15Q '15Q3 '15Q '1Q1 '1Q '1Q3 '1Q '17Q1 '17Q '17Q3 '17Q '1Q1 (JPY/tsubo) 19, 1,19 1,71 1,1 19,971 19,33 19,73 1,35 19,7 19,375, 19,, (%) Source: Sanko Estate ( Rate), Sanko Estate NLI Research Institute (Office ) Central Tokyo Class B office rent turns to increase by yen/tsubo from the previous quarter to, yen/tsubo (excluding CAM). The rent goes up and down around, yen/tsubo for five consecutive quarters, and appears to slow down its pace of increase. While the vacancy rate remains at the record low, this significantly tightened demand-and-supply balance has not given clear impact on the rent yet. The corresponding vacancy rate continues to decline for six consecutive quarters and falls to 1.%. Along with increasing employment, relative inexpensiveness of Class B rent is attracting costconscious demand continuously. Class B office guidelines Excluding the buildings classified as Class A, Class B includes all the remaining buildings with tsubo or larger area per standard floor including ex- Class A. Subject areas: the same as Class A Years since construction: No limitation 3

4 Central Tokyo Class C Office and 1 35, 3, 5,, 15,, 'Q1 '3Q1 'Q1 '5Q1 'Q1 '7Q1 'Q1 '9Q1 'Q1 '11Q1 '1Q1 '13Q1 '1Q1 '15Q1 '1Q1 '17Q1 '1Q1 Class C '15Q1 '15Q '15Q3 '15Q '1Q1 '1Q '1Q3 '1Q '17Q1 '17Q '17Q3 '17Q '1Q1 (JPY/tsubo) 13,75 13,39 13, 1,3 15, 15,1 1,7 15,35 15,771 1,91 15,7 15,97 1,1 (%) Source: Sanko Estate ( Rate), Sanko Estate NLI Research Institute (Office ) Central Tokyo Class C office rent increases by 3 yen/tsubo from the previous quarter to 1,1 yen/tsubo (excluding CAM). The rent keeps moderate pace of recovery and exceeds 1, yen/tsubo for the first time in three quarters. Class C vacancy rate has fallen by.3 points to 1.% for the first time since Q 7. It continues to decline constantly for over seven years after the peak at.7% in Q3 and is approaching the record low at 1.3% recorded in Q1 7. Class C office guidelines Class C includes all the buildings with to less than tsubo area per standard floor. Subject areas: the same as Class A Years since construction: No limitation

5 Central Tokyo Class A, B and C Y-O-Y Change (%) 'Q1 '3Q1 'Q1 '5Q1 'Q1 '7Q1 'Q1 '9Q1 'Q1 '11Q1 '1Q1 '13Q1 '1Q1 '15Q1 '1Q1 '17Q1 '1Q1 Class A Class B Class C '15Q1 '15Q '15Q3 '15Q '1Q1 '1Q '1Q3 '1Q '17Q1 '17Q '17Q3 '17Q '1Q1 Class A 5.7% 17.% 17.5% 7.5% 9.1% -5.3% -5.5%.% -1.% 9.9%.1%.%.% Class B 9.% 13.% 5.%.% 5.1%.7%.3%.7% -1.1%.%.% 7.% 1.5% Class C -3.1%.9%.1% 1.% 1.5% 9.5%.%.%.%.9%.%.1%.% Source: Sanko Estate NLI Research Institute Y-O-Y changes of each Class A, B and C are +.%, +1.5% and +.% respectively. All of 3 classes have recorded positive growth consecutively for the last four quarters. About Sanko Estate Sanko Estate is regarded as the leading provider of real estate services in Japan; consistently representing the largest percentage of office space transactions owned by major developers and landlords. Since 1977, Sanko Estate has helped thousands of foreign and domestic firms find the best office space throughout Japan for their needs and budgets. The company offers comprehensive real estate services including consulting and market research as well as office leasing services. 5