Fukuoka Reit Corporation · TSE:8968
Fukuoka Reit — 15th fiscal period Earnings Presentation
51 slides from Fukuoka Reit's earnings presentation, April 2012
Slide 1: Overview of the 15th fiscal period performance
“ee Fukuoka REIT Corporation Security code » Overview of the 15th fiscal period performance[8968] September 1$',2011~February 29",2012
Slide 2: Contents
Financial statements 2 Overview of office operation 20 Business forecasts 9 Growth strategy 23 Financial strategy 12 Appendix 26 Overview of retail operation 15 ＊Regarding rounding of amounts, percentage, and ratios : unless otherwise noted, in these materials, monetary amounts are rounded down to t
Slide 3: Financial highlights
Financial highlights Keeping a stable dividend (unit : mm yen) 11th fiscal period 12th fiscal period 13th fiscal period 14th fiscal period 15th fiscal period Variation 16th fiscal period 17th fiscal period Category 〜 Aug 31, 2011 〜 Feb 29, 2012 〜 Aug 31, 2012 〜 Feb 28, 2013 〜 Feb 28, 2010 〜 Aug 31,
Slide 4: Balance sheets (compared with previous fiscal period)
Balance sheets (compared with previous fiscal period) (unit : mm yen) 14th 15th 14th 15th Variation Category 〜Aug 31, 2011 〜Feb 29, 2012 Variation Category 〜Aug 31, 2011 〜Feb 29, 2012 B－A A B B－A A B Current assets 8,362 8,718 355 Current liabilities 14,662 21,230 6,567 Cash and deposits 2,568 3,386
Slide 5: Income statements (compared with previous fiscal period)
Income statements (compared with previous fiscal period) Revenues decreased due to Canal City Hakata store closures for renovations (unit : mm yen) Sign indicates impact on net income (unit : mm yen) 14th 15th Variation Category 〜Aug 31, 2011 〜Feb 29, 2012 B－A A B Operating revenues 7,045 6,931 （113
Slide 6: Income statements (compared with forecast)
Income statements (compared with forecast) Operating income exceeded forecast in active retail properties (unit : mm yen) Sign indicates impact on net income (unit : mm yen) 15th Budget Variation Category 〜Feb 29, 2012 A B B－A Operating revenues 6,899 6,931 ① 32 Rental revenues-real estate 6,682 Ope
Slide 7: Cashflow statements (compared with previous fiscal period)
Cashflow statements (compared with previous fiscal period) (unit : mm yen) 14th 15th Variation Category 〜Aug 31, 2011 A 〜Feb 29, 2012 B B－A Net cash provided by (used in) operating activities 3,294 3,677 383 Income before income taxes 2,083 2,046 （37） Depreciation and amortization 1,164 1,177 12 Red
Slide 8: Historical occupancy rates
Historical occupancy rates Maintained overall occupancy rate over 99% ■Historical occupancy rates Financial statements ＊Calculated by weighted average ＊Overall of J-REITs’ occupancy rates are calculated by weighted average based on historical figures of The Investment Trusts Association, Japan, at F
Slide 9: Appraisal value
Appraisal value Ended 15th fiscal period with unrealized gains of 5,543 million yen （＊1） (unit : mm yen) Amount Variation Latest Appraisal recognized Variation from amount 15th fiscal 14th fiscal Acquisition Acquisition from appraisal recognized in period-end period-end Appraisal Property name price
Slide 10: Business forecast (16th fiscal period)
Business forecast (16th fiscal period) Maintained the previous forecasts at 16,000 yen ■Forecast in 16th fiscal period (unit : mm yen) Sign indicates impact on net income (unit : mm yen) 16th 16th 15th 16th 15th forecast at forecast at this results forecast Category results previous period period va
Slide 11: Business forecast (17th fiscal period)
Business forecast (17th fiscal period) Completion of the large renovation in Canal City Hakata ■Forecast in 17th fiscal period (unit : mm yen) Sign indicates impact on net income (unit : mm yen) 16th 17th forecast at this forecast at this 16th Category period period forecast variation A B B-A Busine
Slide 12: Dividend's track record
Dividend’s track record Keeping a stable dividend ■Dividend forecasts / results (unit : yen) Fiscal period 6th 7th 8th 9th 10th 11th 12th 13th 14th 15th 16th 17th Results 18,360 18,499 18,373 18,049 17,377 17,397 16,783 16,465 16,922 16,621 Forecasts Business forecasts （latest fiscal prior） 17,600 1
Slide 13: Key financing events in 15th fiscal period
Key financing events in 15th fiscal period Committed credit line's borrowing limit increased (limit:12 billion yen) and maturity extended ■Key financing events in 15th fiscal period ■Breakdown of debt by lenders Financial strategy ■Credit ratings (＊1) (＊1) S&P:long-term issuer rating obtained from S
Slide 14: Borrowings profile
Borrowings profile Maintaining the stable financial conditions ■Duration (average time to maturity) ■Diversification of debt maturities Financial strategy ■Average interest rate paid during fiscal periods ■Proportions of fixed-rate and floating-rate debt 13
Slide 15: List of borrowings
List of borrowings Banking relationships with regional banks throughout Kyushu (As of February 29, 2012) Repayment Type Lender Amount（JPY） Borrowing Date Payment Method Annual Interest Description Maturity Short-term debt ｰ - - - - - - The Bank of Fukuoka, The Nishi-Nippon City Bank, Oita Bank, The
Slide 16: Active retail
Active retail Canal City Hakata's revenues declined due to tenant closures Overview of retail operation 15
Slide 17: Fukuoka retail market
Fukuoka retail market Opened East Building at Canal City Hakata in September, 2011 Overview of retail operation 16
Slide 18: Breakdown of rents from retail properties
■アクティブ商業賃料構成比 Breakdown of rents from retail properties ■Breakdown of rents by property ■Breakdown of total rents Overview of retail operation 17
Slide 19: Passive retail
Passive retail Tenant’s renewal at Square Mall Kagoshima Usuki ■Square Mall Kagoshima Usuki tenant renewal Overview of retail operation 18
Slide 20: Top tenants by leased floor area
Top 10 tenants by leased floor area Overview of retail operation 19
Slide 21: Historical and projected office building occupancy rates
Historical and projected office building occupancy rates Keeping to maintain well occupancy rate Overview of office operation ＊Note: Calculated as a weighted average. ＊Total leasable space is figured as of the end of period. ＊Residential floor spaces are removed from Taihaku Street Business Center.
Slide 22: Fukuoka office market (1)
Fukuoka office market（1） Few office buildings have been constructed in Fukuoka since 2010 ■Average vacancy rates in major Japanese cities Overview of office operation ■New supply in major cities 21
Slide 23: Fukuoka office market (2)
Fukuoka office market（2） Rising occupancy rates due to office tenants relocating from Kanto to Kyushu ■Gofukumachi Business Center ■Growth in-migration to Kyushu Overview of office operation 22
Slide 24: Growth Strategy
Growth Strategy Growth strategy (＊1) Assets under management: total acquisition price of properties owned by Fukuoka REIT as of period-end. (＊2) Anonymous partnership equity interest managed by an SPC（CCH Bridge Y.K.）has excluded from assets under management since the 14th fiscal period. ＊Kominedai
Slide 25: New acquisition properties
New acquisition properties Two properties were acquired at start of 16th fiscal period ■Aqualia Kego ■Aqualia Chihaya Growth strategy 24
Slide 26: Investment policy
Investment policy Aimed to invest the properties with stable cashflow （as of March 1,2012） Growth strategy ■Current situation of properties Area Acquistion price Ratio based on Investment policy Ratio based on acquistion（%） Type Acquistion price acquistion（%） Investment policy At 15th period-end Mar
Slide 27: Appendix
[4 Appendix
Slide 28: Profile
Profile Profile Investment unit price ■Name Fukuoka REIT Corporation ■Unit price 536,000 yen (as of February 29, 2012) ■Asset manager Fukuoka Realty Co.,Ltd ■Outstanding units 123,050 units (as of February 29, 2012) Licensed by Fukuoka Local Finance Branch Bureau (financial instruments)No.10 ■Market
Slide 29: A real estate investment trust specializing in regional properties
A real estate investment trust specializing in regional properties ■Sponsors ■Investment policy Appendix (＊1) Concluded MOU with Fukuoka REIT Co. and Fukuoka Realty Co. concerning pipeline support. (＊2) Concluded with Fukuoka REIT Co. and Fukuoka Realty co. concerning provision of property informati
Slide 30: Portfolio table
Portfolio table (As of February 29, 2012) Acquisition Total leasable Occupancy Number of Age Investment Acquisition Source space at end rate at end of tenants at end Primary tenants Property name price(mm yen) (＊1) ratio timing (＊3) of period（㎡） period of period at end of period (＊2) Washington Hote
Slide 31: Portfolio (1/8)
Portfolio（1/8） Acquired Aqualia Kego and Aqualia Chihaya at start of 16th fiscal period (As of March 1, 2012) Appendix 30
Slide 32: Portfolio (2/8)
Portfolio (2/8) ll Address : 1-chome,Sumiyoshi, Hakata-ku, Fukuoka City i Total leasable space: 46,012.98 Built: April 15,1996 1 Property manager: Fukuoka Jisho Hakata 7 ee Nakasu ep jakasi / ae Canal City oN — | | Hakata ekimae-dori The Nishi-Nippon, Sumiyoshi City Bank Shrine
Slide 33: Portfolio (3/8)
Portfolio (3/8) 1 Address: 1-chome,Sumiyoshi,Hakata-ku, Fukuoka City Il Total leasable space :63,706.69mi Built: April 15,1996 @ Property manager: Fukuoka Jisho Nakasu %, Gion Stn | %, ty, % Canal City a Hakata-B +S my Hakata ekimae-dort 4 The Nsh-Nppon ‘Sumiyoshi. Chy Bang 4100 Shrine a int Fukuoka
Slide 34: Portfolio (4/8)
Portfolio (4/8) SS te (2Park Place Oita 1 Address: 2-chome,Koen Dori Nishi,Oita City @ Total leasable space: 103,836.54 Built: March 26,2002/April 17,2002 April 28,2004/April 9,2007 March 31,2008 @ Property manager: Park Place Oita ~ a ee oe »— One WS fo JR Nippou Line =} Fae Oita’Stn: v4 a Or amma)
Slide 35: Portfolio (5/8)
Portfolio (5/8) @3SunLive City Kokura @ Address: 2-chome,Kami Kuzuhara,Kokura-ku, Kitakyushu City I Total leasable space:61,450.22m Built: March17,2005 1 Property manager: Fukuoka Jisho Kapa Siraminami fkura race course | Ward'Qffice CS Meh frome", *e, 42500, % es Ishida Sin. gf May / Fukuoka re11 S
Slide 36: Portfolio (6/8)
Portfolio (6/8) (DAEON Hara Shopping Center| | Hanahata SC (® Square Mall Kagoshima Usuki} | (Kurume Higashi Kushiwara SC ll Address: 6-chome,Hara Sawara-ku, Fukuoka City ll Address :4-chome,hanahata, Minami-ku, 1 Address: 2-chome,Usuki,Kagoshima City I Address : Higashi kushiwara-cho, Kurume City I
Slide 37: Portfolio (7/8)
Portfolio (7/8) Offic iC ice Office Of Canal City Business Center Buildinng @Gofukumachi Business Center (®©yTaihaku Street Business Center ®Sanix Hakata Building @ Address: 1-chome, Sumiyoshi,Hakata-ku, Fukuoka City Wl Total leasable space:23,032.64mi Built: April 15,1996 @ Property manager: Fukuok
Slide 38: Portfolio (8/8)
Portfolio (8/8) (@)Amex Akasakamon Tower @City House Keyaki Dori (®Aqualia Kego @Aqualia Chihaya @ Address :2-chome,Maizuru,Chuo-ku, Fukuoka City ll Total leasable space: 4,755.14mi @ Built: July 26, 2005 Property manager: DMC (the Daio Group) ~\paiel Fukuokachua Nistury Etementery ‘Scheor % Post Of
Slide 39: Income and expenditure by properties (Active retail, Passive retail)
Income and expenditure by properties（Active retail, Passive retail） (unit : mm yen) 15th Total 14th Total Variation Forecast Variation Category Canal City Hakata Canal City Hakata・B Park Place Oita SunLive City Kokura A B A－B C A－C 15th fiscal period (September 1, 2011 〜 February 29, 2012) (Length)
Slide 40: Income and expenditure by properties (Office, Others and Total)
Income and expenditure by properties（Office, Others and Total） (unit : mm yen) Canal City 14th Gofukumachi Sanix Hakata Taihaku Street Higashi Hie 15th Total Variation Forecast Variation Category Business Center Total Building Business Center Building Business Center Business Center A A－B C A－C B 15
Slide 41: Capital expenditures, etc.
Capital expenditures, etc. ■Capital expenditures, repair & maintenance expenses, depreciation, and taxes & fees Appendix (unit : mm yen) Fiscal period Property Purpose Construction cost Common area repairs and improvements 74 Park Place Oita Renovation works 124 Electrical works 98 15th (actual) Tai
Slide 42: Asset management company's organization
Asset management company’s organization Appendix 41
Slide 43: CSR initiatives (1/3)
CSR initiatives（1/3） Corporate governance ■Investment guidelines (voluntary rules for related-party transactions) Appendix 42
Slide 44: CSR initiatives (2/3)
CSR initiatives（2/3） Activities to contribute to society（1） ■CSR workshops Appendix ■Support organizations' activities 43
Slide 45: CSR initiatives (3/3)
CSR initiatives（3/3） Activities to contribute to society（2） ■Fukuoka Reinvention Evenings Appendix 44
Slide 46: Strengths of Fukuoka City
Strengths of Fukuoka City Increase in foreign tourists ■Foreign visitors to port to Hakata ■Number of foreign cruise Appendix ■Foreign visitors to Fukuoka airport ■Discount airlines（Law cost carrier=LCC） 45
Slide 47: IR activities
IR activities ■Website awards ■Kyushu IR workshops launched Appendix 46
Slide 48: Unitholders' data
Unitholders’ data Increase of individual investors ■Distribution by investor category (breakdown of investment units) ■Major investors (end of the 15th fiscal period) Appendix 47
Slide 49: Unit price chart
Unit price chart Market capitalization(as of February 29, 2012):65.9 bn yen BHistorical high(closing price):1, 300,000 yen(February 26, 2007) — Investment unit price BHistorical low(closing price):297, 000 yen(November 20, 2008) Turnover (yen) (units) 1,500,000 14,000 13,978Units June 21, 2005 Initi
Slide 50: Map of Fukuoka
Map of Fukuoka Fukuoka City Ye Hilton Fukuoks°? Dome Okihama-machi @ Hakata PortInternational Passenger Terminal National Kyushu Medical Center Hospital e e Marine Messe Hi jaws Fukuoka: e Fukuoka Tower ijo-machi e Fukuoka Sannou x Hospital Taihaku nw <machi oo \ +s Shite \ -gofuku Momoch Chis Park
Slide 51: Appendix
Matsuda Hakomatsu ‘=== Shinkansen (bullet train) line ome JR railway lines Fukuoka municipal subway lines ers Nishitetsu Tenjin Omuta Line and Kaizuka Line jeer Fukuoka Urban Expressway Vv . Maidashi, The medical Sit department of Kyuhsu University @. Fukuoka Prefectural ff ‘Chidori-bashi ‘dori i =
Fukuoka REIT — 15th fiscal period Earnings Presentation on 6ix