For Immediate Release

Transcription

1 For Immediate Release REIT Issuer: ORIX JREIT Inc. (TSE: 8954) Yutaka Okazoe President and Executive Director Asset Management Company: ORIX Asset Management Corporation Hiroshi Yasuda President and CEO Inquiries: Hiroshi Nishio Director and Executive Officer TEL: ORIX JREIT Announces A New Asset Acquisition Of ( GOOD TIME LIVING Shin-urayasu ) TOKYO, August 23, 2012 We, ORIX JREIT Inc. ( OJR ) hereby announces we have decided to acquire GOOD TIME LIVING Shin-urayasu, as described below. 1. Acquisition Summary Asset to be acquired : Real estate trust beneficial interest (scheduled) * *As of today, no trust has been established for the GOOD TIME LIVING Shin-urayasu. It is planned that a trust will be established upon the closing. Acquisition price : 1,550,000,000 (excluding national and local consumption taxes, etc.) Scheduled acquisition date : September 6, 2012 Current owner and seller : Hospitality Residence/Two Special Purpose Companies Funding method : Loan proceeds (scheduled) Payment terms Upon execution of contract 5,000,000, and lump sum settlement of : the remaining amount on transfer. 2. Purpose of the Acquisition For the purpose of maintaining or increasing distributions to the unitholders over the medium to long term, we are working to invest selectively to the real estate with stable cash flow and outstanding earning potential, and upgrading the quality of our property portfolio through asset replacement efforts. Based on these investment strategy, we are proactively investing in quality real estate considering property type and regional diversification, and have decided to acquire GOOD TIME LIVING Shin-urayasu ( the Property ). The Property maintains a long-term high occupancy rate through the high performance and operational capabilities of the operator (facility operations business), and has stable cash flow. Upon acquisition of the Property, we are scheduled to sign a rent guarantee-type master lease agreement with ORIX Real Estate Corporation, and OJR anticipates the Property will produce stable earnings over the medium- to long-term. 1/8

2 We are continuously aiming to construct our portfolio based on an integrated model that considers reducing exposure to risk through the property type and regional diversification, and maintaining and increasing the stability and growth potential of distributions over the medium to long term. (1) Location The Property is located approximately 10 minutes away by bus, approximately a 3-minute walk from nearest bus stop. Land block reorganization was completed in the nearby Akemi area in March 2009, and the district is a highly popular area due to a superior living environment formed by a cityscape that offers a sense of unity from a well-planned preparation of residential and commercial facilities, parks and greenery, as well as roadways, etc. (2) Building Facility and Operators, etc. The Property is designed as fee-based elderly housing with nursing care and is comprised of 74 rooms in total, of which 66 rooms are single occupancy and eight rooms are double occupancy. In addition, the common use facilities include restaurants, party rooms, family rooms (overnight accommodation for visitors), beauty/hair salon and medical office, etc. providing high quality living not just limited to nursing care and medical services. The operator of the Property, ORIX Living Corporation is an elderly housing operations company established on April 1, 2005 through joint investment (shareholder s equity of 50 million yen, investment ration75:25) between ORIX Real Estate Corporation and Handi Network International led by Mitsuru Haruyama, a leading figure in Japan s nursing care and medical services industry. Bolstered by support for the concept of providing a thorough combination of living, nursing care and medical services combined with ORIX Group s credibility, its operational performance records 20 facilities in the greater Tokyo area and the Kansai area. 3. Summary of Acquisition Property Specified asset category Trustee(scheduled) Real estate trust beneficial interest (scheduled) * *As of today, no trust has been established for the GOOD TIME LIVING Shin-urayasu. It is planned that a trust will be established upon the closing. Mitsubishi UFJ Trust and Banking Corporation(scheduled) Term of trust agreement (scheduled) September 6, 2012 September 30,2032 Address 1-3, Akemi 6-chome, Urayasu City, Chiba Usage elderly housing Registered area Land: 4,958.86m 2 Building: 4,111.04m 2 (total floor area) Registered construction Reinforced concrete, flat roof, 4 floors Registered completion date October 31, 2006 Type of ownership Fee simple ownership Previous owner Hospitality Residence/Two Special Purpose Companies Acquisition price 1,550,000,000 (excluding national and local consumption taxes, etc.) Appraised value 1,640,000,000 Appraisal date August 1, 2012 Appraiser Japan Real Estate Institute Scheduled acquisition date September 6, 2012 Public transit access Approx. 10 minutes away by bus, approximately a 3-minute walk from nearest bus stop Usage restrictions Category 1 exclusive districts for medium and high residential buildings Architects SUMITOMO MITSUI CONSTRUCTION CO.,LTD. Structural engineers SUMITOMO MITSUI CONSTRUCTION CO.,LTD. General contractors SUMITOMO MITSUI CONSTRUCTION CO.,LTD. Building inspection agency Tokyo Bldg-Tech Center CO.,LTD. Main facilities and Elevator: 2 (max 13 passengers 1, 1 bed + 1 occupant, or max 15 passengers) specifications Elevator dedicated for small packages : 1 Parking: 19 Bicycle parking: 24 2/8

3 PML 6.64% (based on NKSJ Risk Management, Inc. report ) PML (Probable Maximum Loss) shows the ratio (%) of the cost for recovering a building after being damaged to its state before the damage occurred against the repurchase price, when assuming an earthquake that may occur once in 475 years on average from probability statistics (recurrence interval of 475 years). In evaluating the earthquake risk of a Earthquake resistance building, the calculation is made based on an event risk curve that shows the relationship of the amount of expected loss (horizontal axis) and the probability of the earthquake that causes the loss to exceed the year (vertical axis). However, PML shows the credibility level at 90%, because loss evaluation comes with uncertainties in the earthquake resistance performance of the building, behavior of earthquake vibrations, etc. Collateral None Due to the impact of the Great East Japan Earthquake, Urayasu City plans to conduct a land register survey (resurvey) in the next three years of the entire Special notes Akemi area, where the property is located, and as a result of the resurvey the site area may change. No. of tenants 1 (as of September 6, 2012) - Gross rental income *Not disclosed as the tenant has not consented. - Security deposits *Not disclosed as the tenant has not consented. Total rent space 4, m 2 (as of September 6, 2012) Total rentable space 4, m 2 (as of September 6, 2012) Occupancy rate 100% (as of September 6, 2012) 105 million per annual *Note: The assumed Net Operating Income (NOI) represents the anticipated revenue/expenditure balance under stable occupancy, calculated by the Asset Management Company based on the Assumed Net Operating master lease agreement with ORIX Real Estate Corporation, etc. at the scheduled acquisition date, Income (NOI) but excluding extraordinary factors that may occur in the fiscal year of the acquisition. The preconditions are as follows. (These figures are not forecasts for the current fiscal period.) 1) Occupancy rate:100.0% 2) Taxes: Taxes are calculated based on the standard tax amount for fiscal Profile of Owner and Seller (as of August 17, 2012) Company Name Hospitality Residence/Two Special Purpose Companies ( the Company ) Address 1-20, Nihonbashi-Muromachi 3-chome, Chuo-ku, Tokyo Representative Akira Sugai 1. Businesses regarding the acquisition of specified assets that follows the asset securitization plan under the Act on Securitization of Assets, and the management Primary and disposal of the specified assets. 2. Other ancillary businesses related to the securitization of the aforementioned specified assets. Shareholders Equity 1,000,000 Date of establishment November 16, 2006 Major shareholder Not disclosed Net Assets Not disclosed Total Assets Turnover Not disclosed Relationships with OJR or its asset management company Capital relationships Personal relationships There is no capital relationship required for reporting between we and ORIX Asset Management Corporation ( OAM ) and the Company. There is no personal relationship required for reporting between we or OAM and the Company. 3/8

4 Business relationships Applicability to related parties There is no business relationship required for reporting between we or OAM and the Company. The Company is not a related party for we or OAM. In addition, the related parties and related companies of the Company are not a related party for we or OAM. 5. Information of previous Ownership, etc. The Property is not acquired from a party with any special interest relationships with we or OAM. 6. Profile of Intermediary None 7. Closing Method Funding method: Loan proceeds (scheduled)* Payment condition: Upon execution of contract 5,000,000, and lump sum settlement of the remaining amount on transfer. 8. Acquisition Schedule August 23, 2012 (scheduled): Execution of the sale and purchase agreement September 6, 2012 (scheduled): Settlement and delivery of the property 9. Future Outlook The acquisition of the Property has a minor impact on the financial results for the 22 nd fiscal period (September 1, 2012 through February 28, 2013), accordingly, the financial forecast for the 21 st fiscal period and the 22 nd fiscal period remains unchanged as announced in the release ORIX JREIT Revises Earnings & Distributions Forecasts for the 21 st Fiscal Period (Ending August 31, 2012) and 22 nd Fiscal Period (Ending February 28, 2013) released on July 30, Reference Materials I. Property photo and map II. Appraisal summary III. Portfolio summary after acquisition of GOOD TIME LIVING Shin-urayasu Note: 1. This is the English translation of original Japanese documents and is provided solely for information purposes. If there are any discrepancies between the translation and the Japanese original, the latter shall prevail. 2. The original Japanese version of this announcement was distributed today to the Kabuto Club, the Ministry of Land, Infrastructure, Transport and Tourism Press Club, and the Ministry of Land, Infrastructure, Transport and Tourism Construction Specialty Publication Press Club. 4/8

5 I. Property photo and map 5/8

6 II. Appraisal summary Appraisal 1) Appraised Value 1,640,000,000-2) Appraisal Date August 1, ) Appraiser Japan Real Estate Institute Valuations by method 1) Cost Method 1,680,000,000-2) Income Method i. DCF value.. 1,620,000,000- Discount Rate 6.3% Terminal Capitalization Rate 6.7% ii. DC Value 1,650,000,000- Capitalization Rate. 6.5% Income projection The following figures are for fiscal year income based on the income approach (direct capitalization approach) shown on the Appraisal Report for the Property. The figures are not projections made by ORIX JREIT Inc. or ORIX Asset Management Corporation. (In millions of yen) (1) Gross revenue ( a-b ) 114 a. Effective gross revenue 114 b. Vacancy loss 0 (2) Total costs ( c+d+e+f ) 7 c. Management /maintenance fee (management fee, utility expenses, PM fees, etc.) 1 d. Taxes 5 e. Casualty insurance premium 0 f. Other costs 0 (3) Net revenue ( 1-2 ) 106 (4) Lump sum revenue 2 (5) Capital expenditure 1 (6) Net income ( ) 107 Long Term Projected Repairs According to the Engineering Report by Earth-Appraisal Co., Ltd. the maintenance cost over the next 12 years will be 29,810 thousand. 6/8

7 III. Portfolio summary after acquisition of GOOD TIME LIVING Shin-urayasu Property Acquisition % to Date Price( million) Total Acquisition Price Offices 6 Central Aoyama Suncrest Building December , Tokyo Wards Round-Cross Ichi-bancho December , Round-Cross Nishi Shinjuku December , DT Gaien December , Nihonbashi East Building December , Yoyogi Forest Building December , Round-Cross Minami Azabu December , Round-Cross Akasaka January , Round-Cross Mita January , Shiba Daimon Building January , Round-Cross Tsukiji January , ORIX Shiba 2-chome Building September , Aoyama 246 Building March , Round-Cross Shinjuku April , Seafort Square Center Building September April , ORIX Akasaka 2-chome Building June December , Round-Cross Shinjuku 5-chome April , Nihonbashi Honcho 1-chome Building March , Round-Cross Shibuya March , ORIX Suidobashi Building March , ORIX Shinagawa Building June , ORIX Real Estate Nishi Shinjuku Building March , OX Tamachi Building March , Subtotal 144, Remaining Carrot Tower December , Tokyo Wards Toyo MK Building December , Beside Kiba December , ORIX Ikebukuro Building April , Round-Cross Kamata March , KN Jiyugaoka Plaza May , ORIX Meguro Building July , Akihabara Business Center June , Subtotal 42, Other Parts of Neo City Mitaka December , the Greater Tokyo Area Round-Cross Kawasaki April , Omiya Miyacho Building March , Omiya Shimocho 1-chome Building March , Subtotal 14, Other Areas Nagoya Itochu Building September , ORIX Koraibashi Building April , Lunar Sendai June , ORIX Nagoya Nishiki Building March , ORE Sapporo Building October , ORIX Kobe Sannomiya Building September , Subtotal 39, Offices Total 241, /8

8 *Newly acquired buildings 11: Notes: Acquisition price above refers to sale price (fractions rounded down) specified in the sale and purchase contract. Consumption taxes are not included in the price. 2. Percentage of total acquisition cost refers to the acquisition price of each property under management as a proportion of the total acquisition price. 3. Fractions are rounded to the first decimal places for the Percentage of total acquisition cost. Totals for the Percentage of total acquisition cost may not tally as a result of this rounding. 8/8