ORIX Jreit Inc. · TSE:8954
ORIX Jreit — 16th Fiscal Period Earnings Presentation
42 slides from ORIX Jreit's earnings presentation, Apr 19, 2010
Slide 1: ORIX JREIT Inc. 16th Fiscal Period Results
0 ORIX JREIT Inc. 16th Fiscal Period Results (ended February 28, 2010) April 19, 2010 ORIX Asset Management Corporation
Slide 2: Executive Summary as of 16th account settlement announcement day
Executive Summary as of 16th account settlement announce day 1 Practical Achievement of ¥300 Billion in Assets through Property Acquisition and Turnover with External Growth ポートフォリオの質の向上を目的とする物件入替えを実施 the Aim of Enhancing Portfolio Stability and Profitability, Realization of Increased Distributions
Slide 3: Summary of Results for the 16th Fiscal Period
2 Summary of Results for the 16th Fiscal Period (Ended February 28, 2010)
Slide 4: 16th Fiscal Period: Forecast vs. Actual
16th Fiscal Period: Forecast vs. Actual 3 Item 16th period (Feb 2010) Income-Boosting Factors (million yen) Change ・Disparity in forecast rental revenue + 63 (Million Yen) Forecast Actual ・Disparity in forecast utilities revenue and expenses + 51 Operating ・Disparity in forecast interest-bearing deb
Slide 5: Comparison between the 15th and 16th Fiscal Periods
Comparison between the 15th and 16th Fiscal Periods 4 Item 15th period 16th period Income-boosting Factors (million yen) Change (Million Yen) (Aug 2009) (Feb 2010) ・Full contribution of income from two properties + 73 acquired in 15th period Operating Revenues 11,465 9,790 ▲ 1,675 ・Decrease in admin
Slide 6: Forecast of Results for 17th and 18th Fiscal Periods
Forecast of Results for 17th and 18th Fiscal Periods 5 Item 16th Period 17th Period Forecast Change 18th Period Forecast Change (Million Yen) Feb 2010 Aug 2010 16th to 17th Feb 2011 17th to 18th Operating Revenues 9,790 11,522 1,732 10,357 ▲ 1,164 Operating Income 4,502 5,664 1,161 4,707 ▲ 957 Net I
Slide 7: Operating Conditions During the 16th Fiscal Period
6 Operating Conditions During the 16th Fiscal Period (Ended February 2010)
Slide 8: Achieved Medium- to Long-Term Target of ¥300 Billion in Assets
Achieved Medium- to Long-Term Target of ¥300 Billion in Assets 7 ・Practically achieved medium- to long- term target of ¥300 billion in assets with sale of two properties and acquisition of six properties •Looking ahead, aiming for ¥400 billion in assets while consistently working to improve the qual
Slide 9: External Growth Strategy
External Growth Strategy 8 Implementing External Growth That Responds Flexibly and Rapidly to Changes in the Operating Environment Past Policy Action Office rental market boom Focus on internal growth potential Focused investment in Greater Tokyo, offices and Æ enabling internal growth and competiti
Slide 10: Increase in Portfolio Stability and Profitability
Increase in Portfolio Stability and Profitability 9 Average term of % of lease agreements (fixed- Asset Size Leasing NOI yield Forecast 17th fiscal period No. lease agreement term, etc.) with mid-term （million yen） （％） assuming no sales or （years）（2） cancellation prohibited(3) purchases 49 277,556 5
Slide 11: Increase in Forecast Distribution for 17th Period Through Sale of Properties
Increase in Forecast Distribution for 17th Period Through Sale of Properties (Graphic) 10 Figures (in 50 yen units) are estimated based on forecast results for the 17th fiscal period and do not guarantee actual distribution. Contribution from two properties sold +1,450 (Yen) 18,000 17,000 ▲ 1,700 Co
Slide 12: Application of Exceptional Handling of Taxation for In-Advance Land Acquisition
[Reference] Application of Exceptional Handling of Taxation in the Event of In-Advance Acquisition of Land, etc. in 2009 and 2010 for Future Use 11 Conditions OJR’s Case (1) Acquisition of land, etc., in 2009 or 2010 Acquired two properties below in March 2009 (15th fiscal period) Omiya ORIX Real Es
Slide 13: Properties Acquired in 17th Period (1) - Sakai Logistics Center North Building
Properties Acquired in 17th Period (1) - Sakai Logistics Center North Building 12 ■Located in Osaka Bay Area close to places of high consumption - Located in Osaka Bay Area where many large-scale logistics facilities of the Kansai region have appeared in recent years - Outstanding access to expressw
Slide 14: Properties Acquired in 17th Period (2) - aune Kohoku
Properties Acquired in 17th Period (2) -aune Kohoku 13 ■Location with outstanding profile and close to station - One-minute walk to Yokohama Municipal Subway Center-Minami Station in the middle of Kohoku New Town, Yokohama; convenient location facing station square - Local government offices and lar
Slide 15: Properties Acquired in 17th Period (3) - aune Makuhari
Properties Acquired in 17th Period (3) -aune Makuhari 14 ■Location with outstanding profile and close to station - Located in the middle of Makuhari New City in Chiba, ever developing as a multi function city encompassing “business, residence, study and entertainment” -One-minute walk from JR Kaihin
Slide 16: Properties Acquired in 17th Period (4) - Kobe Momoyamadai SC (site)
Properties Acquired in 17th Period (4) -Kobe Momoyamadai SC (site) 15 ① ② ③ ■Good location with outstanding commercial environment - Located in north of Tarumi-ku, which has roughly 220,000 residents, approximately 15% of Kobe City’s population ④ ⑤ Location Tarumi-ku, - Surrounded by a new town with
Slide 17: Properties Acquired in 17th Period (5) - OX Tamachi Building
Properties Acquired in 17th Period (5) -OX Tamachi Building 16 ■Location with outstanding profile and transport convenience close to station - Located in Shiba-Mita area where head office functions of major corporations are concentrated - One-minute walk from Toei Subway Mita Station and three minut
Slide 18: Properties Acquired in 17th Period (6) - Omiya Shimocho 1-chome Building
Properties Acquired in 17th Period (6) -Omiya Shimocho 1-chome Building 17 ■Located in Omiya area, where demand for offices is high - Located in Omiya area, allowing clients to deploy business activities covering Greater Tokyo, northern Kanto, Joshinetsu and Tohoku - 6 minutes’ walk from east exit o
Slide 19: Rent Revision Trends
Rent Revision Trends 18 Rent RentRevision RevisionStatus Status(by (byFloor FloorArea) Area) Revision-Based Rent Trends Floor area covered Rent increase (existing tenant) Lease renewals by lease renewals Rent increase (new tenant) Rent adjustment (monthly and new leases base) （％） New leases during e
Slide 20: Initiatives Aimed at Maintaining/Increasing Occupancy Rates
Initiatives Aimed at Maintaining/Increasing Occupancy Rates 19 Office Occupancy Rates in greater Tokyo area recovering; Focusing on Office Leasing in Provincial Areas Occupancy Rates and Tenanted and Vacated Area Offices in greater （％） All Offices Tokyo Offices provincial 100 90 80 （㎡） 6,000 Average
Slide 21: Effects of Type Diversification
Effects of Type Diversification 20 Due to high occupancy rates and strong profitability, non-office use contributes to improving portfolio stability Portfolio Diversification (Acquisition Price Based) Non-Office Properties (As of announcement day) 【Non-office uses】 End 16 Period March 2010 Announcem
Slide 22: Trends in Leasing NOI and Leasing NOI Yield
Trends in Leasing NOI and Leasing NOI Yield 21 Leasing NOI yield, all properties Leasing NOI yield of the 29 properties continuously Leasing NOI yield of newly acquired properties held from the end of the 6th fiscal period through to in the initial fiscal period of acquisition (based on the account
Slide 23: Financial Position (Slide 1 of 2)
Financial Position (Slide 1 of 2) 22 Outstanding Interest-Bearing Debt, Loan-to-Value Ratio Composition of Interest- Investment bearing Debt as of April Corporation Short-term 16, 2010 Borrowing 15th End 16th End Apr. 16, 2010 Bond (billion yen) 19.5 Outstanding Interest- 12.0 bearing Debt (¥ millio
Slide 24: Financial Position (Slide 2 of 2)
Financial Position (Slide 2 of 2) 23 Credit Ratings S&P Long-term rating: A-, Short-term rating: A-2 Outlook: Stable R&I Issuer rating: A+ Rating outlook: Stable Commitment Line Commitment line of debt set at ¥27.0 billion in total provided by four financial institutions Investment Corporation Bond
Slide 25: Appraisal Value
Appraisal Value 24 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th (End of (End of (End of (End of (End of (End of (End of (End of (End of (End of Aug 2005) Feb 2006) Aug 2006) Feb 2007) Aug 2007) Feb 2008) Aug 2008) Feb 2009) Aug 2009) Feb 2010) Number of properties 47 39 41 40 44 43 47 48 49 49 App
Slide 26: Investment Units
Investment Units 25 15th 16th Change Unitholder Share Share Share Individuals, etc. Finance Securities Categories Units Units Units （ %） （ %） （ %） Other Corp. Overseas Individuals, etc. 40,999 16.29 41,133 16.35 134 0.33 Finance 126,595 50.31 127,897 50.83 1,302 1.03 0.97% 2.66% Major Banks 3,596 1.
Slide 27: Future Policies and Strategies
Future Policies and Strategies 26 ・Although signs are emerging of a positive cycle in which the recovery in corporate earnings is bringing Understanding improvements in capital expenditure, employment and wages and uncertainty about the outlook for of Market the Japanese economy is fading, corporate
Slide 28: Appendix
27 Appendix
Slide 29: Financial Highlights
Financial Highlights 28 12th Period 13th Period 14th Period 15th Period 16th Period Millions of yen Feb 2008 Aug 2008 Feb 2009 Aug 2009 Feb 2010 Operating Revenues 9,974 10,052 10,522 11,465 9,790 Operating Income 4,925 4,713 5,039 5,838 4,502 Net Income 4,084 3,818 4,016 4,761 3,344 Unitholders' Ca
Slide 30: Appraisal Value: Comparison with the 15th Fiscal Period (Slide 1 of 3)
Appraisal Value: Comparison with the 15th Fiscal Period (Slide 1 of 3) 29 Appraisal value of properties at the end of the 16th fiscal period (1) ※Area symbol: ● 3 Central Tokyo Wards ▲ Remaining Tokyo Wards ■ Other Parts of the Greater Tokyo Area ★ Other Areas End of the 16th Fiscal Period Change fr
Slide 31: Appraisal Value: Comparison with the 15th Fiscal Period (Slide 2 of 3)
Appraisal Value: Comparison with the 15th Fiscal Period (Slide 2 of 3) 30 Appraisal value of properties at the end of the 16th fiscal period (2) End of the 16th Fiscal Period Change from the 15th Period Type Area Property Book value Appraisal CR Gain/loss Change % Change CR Change Chg gain/Loss （\mi
Slide 32: Appraisal Value: Comparison with the 15th Fiscal Period (Slide 3 of 3)
Appraisal Value: Comparison with the 15th Fiscal Period (Slide 3 of 3) 31 Comparison with the 15th Fiscal Period Change in Type NCF Change CR CR Change Appraisal Offices -4.27% -4.48% 4.98% 0.02% Others (Residentials) -1.00% -0.61% 5.98% 0.01% Retail Facilities 0.12% -2.02% 4.60% 0.00% Hotels -9.40%
Slide 33: Capitalize on Synergies with the ORIX Group
Capitalize on Synergies with the ORIX Group 32 Utilizing the strong pipeline of the ORIX Group, continue to focus on achieving external growth by acquiring blue chip properties Asset Balance of the ORIX Group’s Real Estate Business Major projects of ORIX Real Estate Corporation As of the end of Dece
Slide 34: Portfolio Summary
Portfolio Summary 33 List of all real estate held by ORIX JREIT as of April 16, 2010 Acquisition Acquisition GFA Price Ratio GFA Price Ratio Ty pe Area Nam e of building Address (㎡) Year Built (JPY mn) (%) Ty pe Area Name of building Address (㎡) Year Built (JPY m n) (%) Aoyama Suncrest Bldg. Minato-
Slide 35: Portfolio Map
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Slide 36: Key Points for Investment in Logistics Facilities
【Reference】 Key Points for Investment in Logistics Facilities 35 Objectives To stabilize portfolio cash flow, to maintain and increase yield Investment Ratio Approximately 10% of the overall portfolio (Acquisition Price) Areas Greater Tokyo, Greater Chubu, and Greater Kinki areas Location, Scale ・Cl
Slide 37: Portfolio Data (Slide 1 of 2)
Portfolio Data (Slide 1 of 2) 36 Average Sales/Acquisition Price after IPO Property Size (Floor area) Under 3,000 m2 Under 3,000 m2 7.46 13.6% 9.3% Over 15,000 m2 Billion yen Over 15,000 m2 40.3% 28.2% Average Average 15,734 23,475 3,000 m2 to ㎡ ㎡ 3.25 15,000 m2 3,000 m2 to Billion yen 46.0% 15,000
Slide 38: Portfolio Data (Slide 2 of 2)
Portfolio Data (Slide 2 of 2) 37 Area Type Other Area Others Hotels Others 2.1% Other Area Retail 1.4% Hotels 4.1% facilities 5.1% Other Parts of the 15.0% 15.1% 5.3% Greater Tokyo Area 3 Central Logistics 17.3% Other Parts of the Retail facilities facilities 3 Central Greater Tokyo Area Tokyo 1.5%
Slide 39: Major Tenants
Major Tenants 38 Top 10 Tenants as of 16th Period End (Reference) As of 15th Period End Share of Total Share of Total Rented Space Rented Space Name of Tenant Sector Property Name Rented Space Name of Tenant Rented Space (㎡) (㎡) （％） （ ％） Trans- Ichikawa Logistics 1 SENKO Co., Ltd. portation 37,456.9
Slide 40: Cash Management
Cash Management 39 12th period 13th Period 14th Period 15th Period 16th Period (Million yen) Feb 2008 Aug 2008 Feb 2009 Aug 2009 Feb 2010 Depreciation 1,639 1,773 1,874 1,910 1,896 Repair and Maintenance Costs 130 143 更新 112 124 91 CAPEX 43 159 69 272 82 Cash and Cash Equivalents 20,023 20,843 22,01
Slide 41: Disclaimer
40 This document provides supplementary information intended to be helpful in understanding the financial situation, and was prepared and released solely with the intent of providing information. This document should not be construed as an offer or solicitation to buy or sell any specific product, i
Slide 42: Asset Management Company: ORIX Asset Management Corporation
41 When an investor accepts solicitation for subscription or buys or sells OJR’s investment units/investment securities, the investor may be required to pay fees set by the securities dealer in addition to the actual price of the investment units or investment securities (for instance, brokerage com
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