Japan Prime Realty Investment Corporation (8955) achieved stable growth again in its 30th (December 2016) financial results: steady progress toward mid-term target (DPU 7,500 yen)

◎Financial Highlights and Forecasts
・Operating revenues recorded 15.1 billion yen (+850 million yen vs 29th period) with net profit of 6.15 billion yen (+250 million yen).
・Distribution per unit (DPU) increased 292 yen versus 29th period to 7,048 yen. Forecast for the 31th period is 7,140 yen (+92 yen vs 30th period)
・Revenue income from existing portfolio increased significantly, as experienced in the 29th period.
・Asset enhancements were implemented in a well-scheduled manner in order to enhance competitiveness. Utilities balance continued to improve.
・Forecast for operating revenues and net profit in the 31st period are 15.1 billion yen and 6.8 billion yen respectively.
・Forecast for operating revenues and net profit in the 32nd period are 15 billion yen and 6.64 billion yen respectively.
・Mid-term target (DPU 7,500 yen) is aimed to be achieved in the 35th period driven by internal growth and debt cost reduction.

◎Growth Strategy and Investment Update
□Mid-term Growth Strategy
・Mid-term quantitative target (DPU 7,500 yen) was presented during the 29th result announcement.
・With forecasting 7,200 yen in the 32th period, record high growth since IPO will continue.
・Mid to long term platform for stable growth will be reinforced while carefully monitoring changes in external environment.
・Purpose of public offering is to cement platform for stable DPU growth.
□Internal Growth Strategy
・Occupancy rate remains high driven by strong office demand.
・Upon lease revision/tenant turnover, a large number of leases achieved rent increase. Increase in office rents continues.
・In the portfolio asset mix, offices in the premium rent bracket and large-sized tenants are relatively small in percentage. Therefore, impact by massive supply in central Tokyo is limited.
□External Growth Strategy
・GINZA GATES, an urban retail property located on Namiki Dori, a prestigious fashion brand street in Ginza, was acquired from the sponsor in the 30th period.
・FUNDES Suidobashi, the first property of FUNDES brand series, urban compact retail properties developed by the sponsor, was acquired in the 30th period
・Shared ownership in Tokyo Square Garden, a large office property in central Tokyo developed by the sponsor, will be acquired in the 31st period.
・Pipelines such as first rights with the sponsors and asset reshuffle opportunities are fully leveraged.
□Financial Strategy
・Leveling-off of long-term maturity schedule and debt cost reduction
・Debt repayment per period from the 34th period onwards will be leveled off to approximately 10 billion yen.
・Debt cost will be reduced by borrowing over mid term periods when debt repayment per period is significantly below 10 billion yen.