Fiscal year Investor Meeting Presentations｜Financial Reporting｜Information for Investors｜Leopalace21 Corporation

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Investor Meeting Presentation

for the Fiscal Year ended March 31, 2015

Leopalace21 Corporation

This document and reference materials may contain forward-looking statements, but please understand that actual results may differ significantly from these forecasts due to various factors.

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-1-Contents

1. About Leopalace21

1-1 Business Model 4 1-2-1 Results Trend 5 1-2-2 Highlights of Results Trend 6

2. FY15/3 Results

2-1 Highlights of Results 8 2-2-1 Summary of Results (Sales & Gross Profit) 9 2-2-2 Summary of Results (Operating Profit & Net Income) 10

2-3 Results of Business Segments 11

3. FY16/3 Plan

3-1 Plan 13

3-2-1 Summary of Plan (Sales and Gross profit) 14

3-2-2 Summary of Plan (Operating Profit and Net Income) 15

3-3 Plan for Business Segments 16

4. FY15/3 Overview of Business (Leasing)

4-1 Overview of Leasing Business 18 4-2 Main Indicators (Leasing) 19 4-3-1 Indicator(Occupancy Rate) 20 4-3-2 Indicator(Occupancy by Group) 21

4-3-3 Indicator(Shares of Occupied Units by Group) 22

4-3-4 Indicator(Shares of Occupied Units by Industry) 23 4-3-5 Indicator(Foreign Tenants) 24 4-4-1 Acquiring Individual Tenants(Office Expansion) 25

4-4-2 Acquiring Individual Tenants(Room-Customize) 26

4-4-3 Acquiring Individual Tenants(Tenant Services) 27 4-4-4 Enhancing Property Value(Security Systems) 28

5. FY15/3 Overview of Business (Construction)

5-1 Overview of Construction Business 30 5-2 Main Indicator(Construction) 31 5-3-1 Indicator(Orders and Sales) 32 5-3-2 Indicator(Offices and Sales by Area) 33 5-4-1 Example(Ideal Land Usage) 34

5-4-2 Example(New Brand) 35

5-4-3 Example(High-quality Apartments) 36 5-4-4 Example(“Non-sound System”) 37 5-4-5 Example(Houses with rooms for rent, built-to-order houses) 38

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-2-Contents (cont’d)

6. FY15/3 Overview of Business (Others and New)

6-1 Others (Elderly Care Business) 41 6-2 Others (Domestic Hotels Business) 42 6-3 Others (Resort Business) 43 6-4-1 Others (Solar Power Systems) 44

6-4-2 Others (Solar Power Systems by Area) 45 6-4-3 Others (Roof-lease Solar Power Systems) 46 6-5 New Businesses(Leasing Business Overseas) 47

Appendix 1. Corporate Data

App.1-1 Corporate Profile 49 App.1-2-1 Quarter Comparison 50 App.1-2-2 Results of Leopalace21 Group 51 App.1-3-1 Indicator (Occupancy by Group) 52

App.1-3-2 Indicator (Occupied Units by Industry) 53 App.1-3-3 Indicator (Foreign Tenants) 54 App.1-3-4 Indicator (Occupancy Rates by Building Age) 55 App.1-3-5 Indicator (Contract Type) 56

App.1-3-6 Indicator (Leopalace Partners Offices and Contracts)57

App.1-3-7 Indicator (Reserve for Apartment Vacancy Loss) 58 App.1-3-8 Indicator (“Azumi En” Area Disposition) 59

Appendix 1. (cont’d)

App.1-4-1 Finance(Balance Sheets) 60 App.1-4-2 Finance(Cash/Deposits and Interest-bearing Debt) 61 App.1-4-3 Finance(Cash Flows) 62 App.1-4-4 Finance(Shareholder Composition) 63

Appendix 2. Medium-Term Management Plan “EXPANDING VALUE”

App.2-1 Business and Financial Strategies 65 App.2-2 Numerical Targets 66 App.2-3 Dividend Policy 67

Appendix 3. Market Trends

App.3-1 New Housing Starts 69 App.3-2 New Housing Starts (Leased Units) 70

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-4-1-1

：

Business Model

Leopalace21 is a real estate company with two core businesses: a Construction Business which constructs apartments mainly for single persons, and a Leasing Business which manages these apartments. By strengthening the profitability of the Leasing Business, we are moving forward to establish a stock-based business model capable of generating stable profits.

Business model

1. Construction

Propose construction of apartments to land owners. 2. Master lease

Leopalace21 master leases the constructed apartments and pays a fixed rent to owners, regardless of vacancies. 3. Rent

Leopalace21 attracts tenants for leased apartments. 4. Rental income

Rent received from tenants.

⇒ Prior to the Lehman Collapse (2008), apartment construction

increased supported by rising occupancy demand from the booming secondary industry, especially in rural areas. Growth was led by the Construction Business.

⇒ After the Lehman Collapse, corporations laid off personnel,

and tenant leave increased in cities near corporate factories, deteriorating Leopalace21’s earnings.

⇒ Leopalace21 is shifting to a “Leasing Business-based”

business model, limiting apartment construction to areas of high occupancy demand and cutting leasing costs, as well as implementing property value enhancement measures such as installation of security systems.

Owners

Leopalace21

Leasing Construction

Tenants

2. Master Lease

1.

Construction 4.

Rental Income

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277.1 302.7 334.5 342.3 356.6

380.3 383.5 388.7 399.3 411.0

316.1 327.5

359.1

237.0

107.8 62.9 53.3 63.1 61.3

86.0

38.3 42.7

39.5

40.9

19.9 _16.2

17.2 19.1 22.5

28.0 631.6 672.9

733.2

620.3

484.3

459.4 454.2 471.0 483.1

525.0 76.0 71.4 50.1 -29.7 -23.6 4.5 7.4 13.6 14.7 19.5 -20 0 20 40 60 80 -200 0 200 400 600 800 FY07/3 (Actual) FY08/3 (Actual) FY09/3 (Actual) FY10/3 (Actual) FY11/3 (Actual) FY12/3 (Actual) FY13/3 (Actual) FY14/3 (Actual) FY15/3 (Actual) FY16/3 (Plan) Leasing Construction Others Operating profit

1-2-1

：

Results Trend

-5-Sales (Billion yen) Operating profit (Billion yen)

Results Trend

-40

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*Figures for managed units are as of the end of the final month for each fiscal year *Occupancy rate is the average value for each fiscal year

1-2-2

：

Highlights of Results Trend

-6-Highlights of Results Trend

Before the Lehman Collapse in 2008, Leopalace21’s main profit driver was the Construction Business. After the Lehman Collapse, we shifted our business model through structural reforms, generating profit from the Leasing Business.

(Billion yen) FY07/3 FY08/3 FY09/3 FY10/3 FY11/3 FY12/3 FY13/3 FY14/3 FY15/3 FY16/3

Plan

Net sales 631.6 672.9 733.2 620.3 484.3 459.4 454.2 471.0 483.1 525.0

Leasing 277.1 302.7 334.5 342.3 356.6 380.3 383.5 388.7 399.3 411.0

Construction 316.1 327.5 359.1 237.0 107.8 62.9 53.3 63.1 61.3 86.0

Operating profit 76.0 71.4 50.1 -29.7 -23.6 4.5 7.4 13.6 14.7 19.5

Leasing 7.0 3.0 -1.5 -47.8 -30.0 5.2 8.6 15.5 20.5 21.5

Construction 74.6 73.2 70.1 29.7 11.9 4.3 2.7 2.9 0.2 3.5

Net income 37.3 0.3 9.9 -79.0 -40.8 1.5 13.3 15.2 14.5 16.0

Managed units*

(1,000 units) 38.8 442 506 551 571 556 546 549 554 564

Occupancy rate* 92.8% 92.4% 88.5% 82.3% 80.1% 81.2% 82.9% 84.6% 86.6% 88.0%

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-8-2-1

：

Highlights of Results

(Million yen)

FY14/3

Actual

FY15/3

Plan

FY15/3

Actual

_YoY

Compared

to Plan

Sales

471,089

493,500

483,188

+12,099

-10,312

Gross profit

69,579

75,500

75,755

+6,176

+255

% 14.8% 15.3% 15.7% +0.9p +0.4p

SGAE

55,906

61,000

60,992

+5,086

-8

Operating profit

13,673

14,500

14,763

+1,090

+263

% 2.9% 2.9% 3.1% +0.2p +0.1p

Recurring profit

11,574

13,000

13,424

+1,849

+424

% 2.5% 2.6% 2.8% +0.3p +0.1p

Net income

15,229

12,000

14,507

-721

+2,507

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-9-2-2-1

：

Summary of Results

(Sales and Gross Profit)

Sales

Gross Profit

FY14/3 FY15/3 FY14/3 FY15/3

Sales

-10.3 billion yen

compared to plan

Leasing

+2.3 billion yen

Construction

-13.6 billion yen

Gross profit

+0.2 billion yen

compared to plan

Leasing

+3.7 billion yen

Construction

-3.7 billion yen

(Billion yen) (Billion yen) FY

Actual 471.0

FY Plan 493.5

FY Actual

483.1

0 200 400 600

FY Actual

69.5

FY Plan 75.5

FY Actual

75.7

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-10-2-2-2

：

Summary of Results

(Operating Profit and Net Income)

Net income

+2.5 billion yen

compared to plan

Operating profit

+0.2 billion yen

compared to plan

Leasing

+3.0 billion yen

Construction

-3.7 billion yen

Operating Profit

Net Income

(Billion yen) (Billion yen)

FY Actual

13.6

FY Plan 14.5

FY Actual

14.7

10

15 FY

Actual

15.2 FY

Plan 12.0

FY Actual

14.5

0 5 10 15 20

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-11-2-3

：

Results of Business Segments

(Million yen) FY14/3

Actual

FY15/3 Plan

FY15/3

Actual _YoY Compared

to Plan L e a s in g

Sales 388,768 397,000 399,316 +10,548 +2,316

Gross profit 54,187 59,000 62,763 +8,576 +3,763

Operating profit 15,567 17,500 20,532 +4,965 +3,032

C o n s t-ru c tio n

Sales 63,135 75,000 61,312 -1,823 -13,688

Gross profit 14,972 17,000 13,223 -1,749 -3,777

Operating profit 2,954 4,000 210 -2,743 -3,790

E ld e rl y C a re

Sales 10,171 10,500 10,608 +436 +108

Gross profit 355 100 500 +144 +400

Operating profit -610 -1,000 -606 +4 +394

H o te ls & R e s o rt

Sales 7,571 8,000 8,951 +1,379 +951

Gross profit 2,587 3,000 2,781 +193 -219

Operating profit -1,118 -700 -1,289 -170 -589

O

th

e

rs

Sales 1,442 3,000 2,999 +1,557 -1

Gross profit 1,411 1,300 1,660 +248 +360

Operating profit 137 -100 31 -106 +131

Adjust-ments Operating profit -3,256 -5,300 -4,116 -859 +1,184

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-13-3-1

：

Plan

FY16/3 Plan

Actual

FY15/3 Actual

FY16/3

Plan _YoY

Sales

471,089

483,188

525,000

+41,811

Gross profit

69,579

75,755

88,500

+12,744

% 14.8% 15.7% 16.9% +1.2p

SGAE

55,906

60,992

69,000

+8,007

13,673

14,763

19,500

+4,736

% 2.9% 3.1% 3.7% +0.7p

11,574

13,424

18,000

+4,575

% 2.5% 2.8% 3.4% +0.7p

Net income

15,229

14,507

16,000

+1,492

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-14-3-2-1

：

Summary of Plan

(Sales and Gross Profit)

(Billion yen)

Sales

Gross Profit

(Billion yen)

Sales

YoY +41.8 billion yen

Leasing +11.6 billion yen

Construction +24.6 billion yen

Gross profit

YoY +12.7 billion yen

Construction +6.7 billion yen 471.0

483.1

525.0

400 450 500 550

FY14/3 Actual

FY15/3 Actual

FY16/3 Plan

69.5

75.7

88.5

40 60 80 100

FY14/3 Actual

FY15/3 Actual

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15.2

14.5

16.0

10 15 20

FY14/3 Actual

FY15/3 Actual

FY16/3 Plan 13.6

14.7

19.5

10 15 20

FY14/3 Actual

FY15/3 Actual

FY16/3 Plan

-15-3-2-2

：

Summary of Plan

(Operating Profit and Net Income)

Net income

YoY +1.4 billion yen

Operating profit

YoY +4.7 billion yen

Construction +3.2 billion yen

Operating Profit

Net Income

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-16-3-3

：

Plan for Business Segments

FY16/3 Plan (by Business Segments)

Actual FY15/3 Actual FY16/3 Plan _YoY L e a s in g

Sales 388,768 399,316 411,000 +11,683

Gross profit 54,187 62,763 66,000 +3,236

Operating profit 15,567 20,532 21,500 +967

C o n s t-ru c tio n

Sales 63,135 61,312 86,000 +24,687

Gross profit 14,972 13,223 20,000 +6,776

Operating profit 2,954 210 3,500 +3,289

E ld e rl y C a re

Sales 10,171 10,608 11,200 +591

Gross profit 355 500 0 -500

Operating profit -610 -606 -1,400 -793

H o te ls & R e s o rt

Sales 7,571 8,951 12,500 +3,548

Gross profit 2,587 2,781 4,200 +1,418

Operating profit -1,118 -1,289 -500 +789

O

th

e

rs

Sales 1,442 2,999 4,300 +1,300

Gross profit 1,411 1,660 1,700 +39

Operating profit 137 31 -100 -131

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-18-4-1

：

Overview of Leasing Business

 Indicator

 Occupancy Rate

 Occupancy by Group

 Shares of Occupied Units by Groups

 Occupied Units by Industry

 Foreign Tenants

 Measures

 Office Expansion (for individuals)

 Room Customize (for individuals)

 Tenant Services (for individuals)

 Security Systems (enhancing property value) Owners

Leopalace21

Tenants

Master Lease Rental

Income Rent

Leasing Business

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-19-4-2

：

Main Indicators (Leasing)

Actual

FY14/3 Actual

FY15/3 Actual

FY16/3 Plan

Sales

383,574

388,768

399,316

411,000

Gross profit

43,510

54,187

62,763

66,000

8,687

15,567

20,532

21,500

Units under management (as

of the end of FY)

546,204

548,912

554,948

564,000

Occupancy rate (average)

82.94%

84.58%

86.57%

88.00%

Direct offices

(as of the end of FY)

182

184

188 187*

Number of corporate sales

section(as of the end of FY)

46

49

59 59*

Number of employees

(non-consolidated, as of the end of FY)

2,661

2,829

2,989

3,110*

of which, sales employees

1,374

1,512

1,526

1,669*

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80% 82% 84% 86% 88% 90%

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

FY 2012/3 FY 2013/3 FY 2014/3 FY 2015/3

-20-Occupancy Rate

Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Avg.

FY12/3 81.09 80.64 80.87 80.45 80.50 81.05 80.43 80.69 80.54 81.65 82.73 83.40 81.16

FY13/3 81.77 82.18 82.69 82.53 82.90 83.13 82.59 82.55 82.29 83.39 84.48 84.81 82.94

FY14/3 83.32 83.67 83.69 83.50 83.84 84.28 84.23 84.31 84.12 85.61 86.92 87.47 84.58

FY15/3 86.00 86.03 85.96 85.63 85.78 86.33 86.14 86.10 85.69 87.24 88.65 89.29 86.57

4-3-1

：

Indicator (Occupancy Rate)

Achievement of long-term occupancy and stable rates due to increase in long-term contracts. Average occupancy rate for FY16/3 is planned to increase 1.4p YoY (FY15/3: +2.0p YoY).

※

Target average occupancy rate for FY16/3: 88.0%

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200 300 400 500 600

0 50 100 150 200 250 300

Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar

FY09/3 FY10/3 FY11/3 FY12/3 FY13/3 FY14/3 FY15/3

Managed units (right axis) Occupied units (right axis)

70% 80% 90% 100%

-21-Corporate tenants are steadily rising, but increasing the number of individual and student tenants still remains an issue. 1. Promote services attending occupant needs, 2. established “Educational Institution Sales Division” as of October 2014.

4-3-2

：

Indicator (Occupancy by Group)

Occupancy rate

Occupied units by Group (Thousand units)

Managed and occupied units (Thousand units)

Occupancy rate Individuals (left axis) Corporate (left axis)

Students (left axis)

*Figures are as of the end of each month *Reference of p.52

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-22-Both occupied units and shares of corporate tenants are steadily increasing due to reinforcement of corporate sales.

4-3-3

：

Indicator (Shares of Occupied Units by Groups)

*Figures are as of the end of each quarter *Reference of p.52

Shares of Occupied Units by Groups

(Thousand units)

43.2% 44.1% 45.2% 47.3% 47.3% 47.4% 47.7% 49.4% 49.5% 49.5% 49.4% 51.3% 51.5% 51.4% 51.1% 53.0% 42.2% 41.6% 40.3% 38.8% 39.3% 39.4% 38.9% 38.0% 38.2% 38.3% 38.3%

37.3% 37.4% 37.4% 37.6% 36.8%

14.6% 14.3% 14.5% 13.9% 13.4% 13.3% 13.4% 12.6% 12.3% 12.2% 12.3% 11.4% 11.1% 11.1% 11.3% 10.2%

462 464 452 464 460 458 450 463 458 461 461 480 473 476 474 495

0% 20% 40% 60% 80% 100%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

FY12/3 FY13/3 FY14/3 FY15/3

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21.5% _20.0% _19.0% _18.8% _18.1% 9.7% 11.2% _10.7% _11.8% _12.2%

13.8% 13.2% _13.2% 13.4% 13.4%

15.9% 16.2% _16.3% 15.9% 15.6% 6.4% 6.1% _6.4% _6.1% _6.3% 13.9% 14.7% _15.3% 16.2% 16.9% 18.9% 18.5% 18.9% 17.9% 17.5% 202,584 219,239 228,708 246,272 262,577

0% 20% 40% 60% 80% 100%

2011/3 2012/3 2013/3 2014/3 2015/3

-23-4-3-4

：

Indicator (Shares of Occupied Units by Industry)

(Units)

Other

Construction

Food service

Services Staffing, outsourcing Manufacturing Retail

Shares of Occupied Units by Industry

Leopalace21 will pursue strategies of “expanding major business connections” and “cultivating ‘low-use’ business connections” while diversifying industry types of corporate tenants. Approximately 79.3% (+0.8p compared to the previous fiscal year-end) of listed companies* in Japan use Leopalace21.

*Companies listed on the 1st_{and 2}nd_{sections of the Tokyo Stock Exchange, regional stock exchanges, and emerging markets}

*Reference of p.53

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0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 J u n S e p D e c M a r J u n S e p D e c M a r J u n S e p D e c M a r J u n S e p D e c M a r J u n S e p D e c M a r

FY11/3 FY12/3 FY13/3 FY14/3 FY 15/3

China S. Korea Taiwan

Vietnam Thailand Other Southeast Asia

Other

-24-4-3-5

：

Indicator (Foreign Tenants)

Leased Units by Foreign Nationals (Excluding Corporate Contracts)

*Reference of p.54

(Units)

Foreign students are able to make lease contracts through our “LAM (Leopalace Alliance Members) school.”

We are strengthening openings of overseas offices, and operations started in Phnom Penh, Yangon, and Shanghai (real estate brokerage) on August 1, 2014, and Ha Noi on January, 2015. Foreign nationals comprised of students 59% and working-class 41%.

Myanmar 1 office Yangon

Cambodia Overseas

subsidiary Phnom Penh

Thailand Overseas

subsidiary Bangkok

Vietnam Overseas

subsidiary Ho Chi Minh, Ha Noi

Taiwan 1 office Taipei

South

Korea 2 offices Busan, Seoul*

China Overseas

subsidiary

Beijing, Dalian, Shanghai, Guangzhou

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-25-Leopalace21 will recruit tenants through direct offices including 8 overseas and franchise partners. Concerning Leopalace Partners, we will aim for “quality over quantity” and increase contracts through training. 3 direct offices opened in April 2014 and 1 direct office opened in October 2014.

4-4-1

：

Acquiring Individual Tenants (Office Expansion)

Leasing Offices

*Reference of p.57

Direct offices 188 (+4)

of which, domestic 180 (+4)

of which, overseas 8 (±0)

Partners (franchise) 141 (-23)

Total offices 329 (-19)

As of March 31, 2015 (Figures in parentheses represent comparison to March 2014)

* Overseas locations operating foreign real estate brokerage services not included.

(Thailand, Vietnam, Cambodia, and Myanmar)

0 50 100 150 200 250 300 350 400

JunSepDecMar JunSepDecMar JunSepDecMar JunSepDecMar JunSepDec Mar

FY11/3 FY12/3 FY13/3 FY14/3 FY15/3

(Offices)

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-26-4-4-2

：

Acquiring Individual Tenants (Room-Customize)

 Custom wallpaper for free on 1 wall. Thumbtacks, shelves, and scribbling on the wall is OK

 No cost for restoring room to original state

 More than 100 types of wallpaper to choose from, including patterns

 Male-to-female ratio of 50:50, higher percentage of females compared to overall occupancy (70:30)

“Room-Customize”

In May 2012, Leopalace21 has started “Room-Customize” as a strategy for acquiring individual tenants. 21,573 contracts have been acquired as of March 31, 2015, and we will continue to promote the image of “Customize = Leopalace.”

Contracts (Cumulative total)

(# of contracts)

Contests

Room-Customize Contest

Occupants enter their room-customizing ideas

Wall-art Contest

Winners paint their work on the walls of our showroom

“Nagoya-like Rooms”

Students compete in creating rooms which best represent “Nagoya”

21,573

0 5,000 10,000 15,000 20,000 25,000

Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar

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-27-4-4-3

：

Acquiring Individual Tenants (Tenant Services)

Services such as the “concierge service,” which satisfy tenants’ demands upon request, overturn common practices of the leasing apartment industry. Services are available through “MY PAGE,” an exclusive website for our tenants.

MY PAGE matches up the needs of individual and corporate occupants. Individuals are able to use services at a discount price, while

corporations recruit personnel.

Website for Tenants: “MY PAGE”

Tie-up with Corporate Clients



LEONET (Wireless LAN)

Use the web without the hassle of contracting with internet providers. Movies and shows are also available.

Wireless LAN services started as of April 2014.

Commity space for land owners, occupants, students, and corporate clients.

Events held in Osaka, Sendai, and Shinjuku.

Community space “L+”

Individual

occupants

Corporate clients

Discount services

Recruit personnel

Leopalace Center Shinjuku Hotel Leopalace Sendai



Leopalace Online Shopping

Shopping web site with many everyday-necessities. Products made specially for Leopalace are also available.



L-Club Off

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-28-4-4-4

：

Enhancing Property Value (Security Systems)

Orders and Sales of Security Systems

Security systems have been installed in 226,801 rooms as of March31, 2015, equivalent to 40.9% of Leopalace21 apartments. Security cameras have been installed on 5,505 buildings.

 Business alliances with two major security companies

 The standard equipment includes fire sensing systems and emergency systems, in addition to sensors that detect intruders

 We anticipate an increase in the percentage of female tenants

 We are seeking to meet demand for security in corporate housing

(Large companies emphasize security)

Problem detected

Call subscriber, alert emergency services if necessary 3. Dispatch 2. Assign

dispatch Control

Center Emergency

response

personnel dispatched

1. Telephone circuit alert

FY14/3 Actual

FY15/3 Actual

Cumulative total

Orders

Units 51,282 43,606 248,500

Billion yen 9.60 9.09 41.99

Sales

Units 51,692 39,045 226,801

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(31)

-30-5-1

：

Overview of Construction Business

Owners

Leopalace 21

Tenants

Master Lease Rental

Income Rent

Construction Business

 Indicators

 Orders and Sales

 Offices and Sales by Area

 Construction Examples

 Ideal Land Usage

 New Brand

 High-quality Apartments

 Non-sound System

 Houses with rooms for rent, built-to-order houses

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-31-5-2

：

Main Indicators (Construction)

Actual

FY14/3 Actual

FY15/3 Actual

FY16/3 Plan

Sales

53,369

63,135

61,312

86,000

Gross profit

13,197

14,972

13,223

20,000

2,747

2,954

210 3,500

Oders

73,006

81,139

87,395

99,000

of which, apartments and

other buildings

55,174

67,446

84,679

99,000

of which, solar power

systems

17,831

13,693

2,715

0

Offices

(as of the and of FY)

52

54

60 62*

Number of employees

(non-consolidated, as of the end of FY)

1,374

1,506

1,638

1,815*

of which, sales personnel

256

363

418 526*

(33)

-32-5-3-1

：

Indicator (Orders and Sales)

Gross Orders

Construction orders for FY15/3 trending at +7.7% compared to last year. Construction orders of apartments, excluding solar power systems, trending at +25.5%.

*Solar power systems installed on existing apartments are not included in “Gross orders received (buildings)”

Orders and Sales (Including Solar Power Systems)

Q1 Q2 Q3 Q4

Apartments, etc. Solar power systems (excluding those generated by Leopalace21 Group)

FY13/3 FY14/3 FY15/3

13.5 18.1 18.1 _12.2 19.2

24.2

12.8 14.7

21.7

16.5 _15.3 20.5

2.2

5.9

0.6

3.7

3.5

1.0

5.1 2.4

0.9

6.7

1.7

0.1

0 10 20 30

Q1 Q2 Q3 Q4

(Billion yen)

(Billion yen)

FY14/3 FY15/3

Q1 Q2 Q3 Q4 Full-year Q1 Q2 Q3 Q4 Full-year

Gross orders received

(Buildings*) 230 237 195 195 857 223 277 237 229 966

(Billion yen) 24.0 22.7 17.1 17.1 81.1 18.7 25.2 22.7 20.6 87.3

Orders outstanding

(Billion yen) 50.0 52.8 56.9 44.4 44.4 46.7 57.3 64.9 58.1 58.1

(34)

-33-5-3-2

：

Indicator (Offices and Sales by Area)

Total 60 offices

(As of March 2015)

Tokyo metropolitan: 37 offices Tohoku: 3 offices Chubu: 4 offices Kinki: 8 offices Chugoku: 2 offices Kyushu, Okinawa: 5 offices Shikoku: 0 offices Hokuriku, Koshinetsu: 0 offices Hokkaido: 0 offices North Kanto: 1 office Osaka 5 offices

Kyoto 1 office Hyogo 2 offices

Tokyo 18 offices Kanagawa 8 offices Saitama 8 offices Chiba 3 offices

Construction Offices

Apartments Constructed (FY15/3)

Leopalace21 will continue to place offices and operate in areas where high occupancy rates can be expected, specifically in the three metropolitan areas (Tokyo, Kinki, and Chubu).

Tokyo Metropolitan 306 Kinki 90 Chubu 66 Kyushu, Okinawa 59 Chugoku 54 Tohoku 45 Other 36

 Tokyo metropolitan area makes up 46%, and the three metropolitan areas (Tokyo, Kinki, and Chubu) make up 70% of construction sales

(35)

-34-5-4-1

：

Example (Ideal Land Usage)

Elderly care facilities

Apartments

Matching business

between land owners and care facility operators,

addressing the increasing number

of seniors. Products addressing

needs of tenants. Apartments are bulk-leased and managed by Leopalace21.

Built-to-order houses

Stores

Construction of convenience stores, restaurances, and complex buildings with apartments on road-sides and near stations.

Construction of built-to-order houses and house with rooms for rent, in which rent income can be earned.

Leopalace21 proposes the optimal plan fit for the unique conditions of each land.

Proposals including mega-solar power plants and parking lots.

Others

Lang usage

proposions of

Leopalace21

(36)

5-4-2

：

Example (New Brand)

-35-“MIRANDA”

“CLEINO”

New apartment brands “MIRANDA” and “CLEINO” announced in May 2015. While maintaining basic installments such as security systems and the industry’s top class sound-insulation, the launch of two unique brands will strengthen competitiveness and renew brand image.

 Concept is “plain.”

 A “plain-type” apartment brand that fits and matches to each occupant’s needs and lifestyle.

 Concept is “decorative.”

(37)

-36-5-4-3

：

Example (High-quality Apartments)

Announced in October 2013, “Arma-L tri-EL” is an apartment which integrates the characteristics of our two main products

“DUAL-L” and “Arma-L.” Also, we have announced “L-SECtion,” with installments improving the comfortability of the first floor.

 Space is utilized effectively by a “bunk-bed”

(multifunctional bed) which unifies a bed and storage.

 Improved security and privacy by blocking the line of sight from the outside with 1.7m “high-position balcony.”

 Exclusive area 25-31 m2

 Three lofts of “DUAL-L” create a luxurious space equivalent to 1LDK

 Like the “Arma-L” which was designed to address the needs of female tenants, a dresser is placed in the living space, as well as wall storage and counter-type kitchen.

Addressing Female Needs: “

Arma-L tri-EL

”

Improving First Floor Comfortability: “

L-SECtion

”

High-position balcony

(38)

-37-5-4-4

：

Example (“Non-sound System”)

From April 2013, Leopalace21 apartments are standardly equipped with sound-insulating “non-sound system,” including noise reduction walls, soundproof drains, and “non-sound floors” which reduce noise levels by two ranks compared to conventional wooden structures.

Upgraded Sound Insulation with “

Non-sound System

”

Sound-insulating

drainpipes

Installed as a measure against drainage noise. Decreases noise by 15 dB compared to conventional models, providing

environments similar to “libraries or midnight suburbs.”

Non-sound floor

Reduces noise from upper floors. Insulation improved two to three ranks compared to conventional models.

Sound-insulating

walls

Improved sound-insulation quality of walls, providing TLD-45 for wooden structures and TLD-50 for steel frame structures.

Down

15dB

Construction example Cross section Wooden

TLD-45

Wooden structures

Steel

TLD-50

Steel frame structures Wooden

V-model

Down

1/3

Wooden structures V-model (option)

Steel

Down

1/3

Steel frame structures

(39)

5-4-5

：

Example (Houses with rooms for rent, built-to-order houses)

-38-Luxury custom-built “

Taiga

”

 Free design house built with top quality kiso-hinoki wood

 In addition to the durability of kiso-hinoki wood, ventilation systems prevent deterioration

 Strong earthquake protection by placing structural control dampers in a balanced manner

A steel-frame house with rooms for rent, “Smaio” and a wooden-structured “Smaio-W” were announced in April 2013. Also, luxury custom-built “Taiga” homes made with kiso-hinoki wood jointly designed with Morizou was announced on May 2014. Leopalace21 is aiming for diversification of our construction sales by acquiring shares of Morizou and making it into our subsidiary as of March 2015.

House with Rooms for Rent “

Smaio

”, “

Smaio-W

”

 “Smaio” is a combination of a house and an apartment, and rent income can be earned to pay the loans on the house

(40)

-39-FY14/3 Actual

FY15/3 Actual

Elderly care facilities

Orders

Buildings 44 19

Billion yen 5.5 4.3

Sales

Buildings 30 22

Billion yen 3.6 2.8

Stores

Orders

Buildings 14 16

Billion yen 0.5 0.5

Sales

Buildings 15 13

Billion yen 0.5 0.4

Elderly care facilities (Setagaya-ku, Tokyo)

Stores

（Osaka City, Osaka）

5-4-6

：

Example (Elderly Care Facilities and Stores)

Orders and Sales of Elderly Care Facilities and Stores

(41)

(42)

-41-6-1

：

Others (Elderly Care Business)

*Elderly Care Business includes 63 “Azumi En” facilities in Tokyo and 6 prefectures (as of March 31, 2015) *Private residential homes include Group homes

Elderly Care Business

Elderly Care Business is positioned as a growth strategy area, planning to open 29 facilities in the next three years to a total of 90. 2 facilities opened during FY15/3 and 5 facilities will open during FY16/3. Occupancy rate of day-services decreased due to the start of operations on Sundays when we used to close.

Azumi En Grande Tokiwadaira Azumi En Grande Souka Azumi En Kisarazu

Actual

FY15/3 Plan

FY15/3

Actual _YoY Compared to

Plan

E

ld

e

rl

y

C

a

re

Sales 10,171 10,500 10,608 +436 +108

Gross profit 355 100 500 +144 +400

Operating profit -610 -1,000 -606 +4 +394

Occupancy rate (Day-service) 72.7% 74.8% 67.2% -5.4p -7.6p

Occupancy rate (Short-stay) 99.2% 96.9% 98.1% -1.1p +1.2p

Occupancy rate

(Private residential homes, etc.) 93.8% 93.9% 93.5% -0.3p -0.4p

(43)

-42-6-2

：

Others (Domestic Hotels Business)

*Domestic Hotel Business includes 7 hotels (Asahikawa, Sapporo, Sendai, Niigata, Nagoya, Okayama, and Hakata) as of the end of March 2015

Domestic Hotels Business

Occupancy rates improved due to increase in usage by client companies of the leasing business.

*Hotel Leopalace Yokkaichi (transferred in August 2014) and Hotel Leopalace Niigata (transferring in July 2015) sold.

Hotel Leopalace Sendai

Hotel Leopalace Sapporo

Hotel Leopalace Hakata

Actual

FY15/3 Plan

FY15/3

Actual _YoY Compared to

Plan

D

o

m

e

s

tic

H

o

te

ls

Sales 2,317 2,300 2,284 -32 -16

Operating profit 9 -40 -30 -40 +10

Depreciation and amortization 375 375 337 -37 -38

(44)

-43-Resort Business (Leopalace Guam)

6-3

：

Others (Resort Business)

*Non-consolidated figures for Leopalace Guam

*Fiscal year of Leopalace Guam is from January to December

Although tourists visiting Guam has not increased year-on-year, an increase in usage by leasing business tenants has increased both occupancy rates and earnings. Usage by soldiers coming to Guam on exercises started from the end of August 2014.

Westin Resort Guam

Leopalace Resort Leopalace Resort Country Club

(Thousand U.S. dollars) FY2013/12

Actual

FY2014/12 Plan

FY2014/12

Actual YoY Compared

to Plan

L

e

o

p

a

la

c

e

G

u

a

m

Sales 75,099 78,000 85,036 +9,937 +7,036

Operating profit 884 3,500 585 -299 -2,915

Depreciation and amortization 15,116 15,000 14,340 -776 -660

Occupancy rate (Leopalace Resort) 66.7% 69.5% 70.9% +4.2p +1.1p

(45)

FY12/3 Q2 FY12/3 Q4 FY13/3 Q2 FY13/3 Q4 FY14/3 Q2 FY14/3 Q4 FY15/3 Q2

Owner-invested Roof-lease (SPC) Roof-lease (Leopalace21 Group)

-44-*2.b.”Installments by Leopalace21 Group” are eliminated on a consolidated basis. (Reference of p.46)

-44-6-4-1

：

Others (Solar Power Systems)

Solar power installments started in March 2011. Solar power systems were installed on 12,356 buildings as of March 2015. (about 55% of buildings that can be installed)

Installments by Schemes

Schemes Start FY14/3 FY15/3

1. Solar power systems installed with apartment

owners’ burden Mar 2011 6,629 （79.7MW） 7,129 （89.1MW）

2. Roof-lease solar power systems Sep 2012 2,372 （46.1MW） 5,227 （83.3MW）

a. SPC and other tie-up installments Feb 2013 1,258 （24.6MW） 1,258 （24.6MW）

b. Installents by Leopalace21 Group

* Dec 2013 1,114

（21.4MW） 3,969 （58.7MW）

3.

Mega-solar power plants utilizing idle land Sep 2013 Tomisato,

Chiba （1.7MW）

Tomisato,

Chiba （1.7MW）

Total: 9,001 （125.8MW） 12,356 （172.4MW） (Cumulative total)

0 2,500 5,000 7,500 10,000 12,500 15,000

FY14/3 Q1

Q2 Q3 Q4 FY15/3 Q1

(46)

-45-6-4-2

：

Others (Solar Power Systems by Area)

Solar Power System Installations by Area

(as of March 31, 2015)

(Buildings)

Solar power systems are not installed in snowy areas (Hokkaido and Tohoku), areas with volcanic ashes (Kagoshima), and areas on the seashore with risk of salt damage.

A third of installments are in the Tokyo metropolitan area , where Leopalace21 apartments are abundant.

Total: 12,356

1,158 388

913

1,552

2,301 261

4,185 1,171

427

0 1,000 2,000 3,000 4,000 5,000 Kyushu, Okinawa

Shikoku Chugoku Kinki Chubu Hokuriku, Koshinetsu Tokyo-metro North Kanto Tohoku

(47)

-46-6-4-3

：

Others (Roof-lease Solar Power Systems)

Roof-lease Solar Power Systems by Leopalace21 Group

FY14/3 Actual

FY15/3

Actual Cumulative total

Buildings installed

1,114

2,855

3,969

Generating capacity

_{21.4 MW}

_{37.2 MW}

_{58.7 MW}

Buildings which started

generation

680 3,102

3,782

Sales from selling generated power

(Billion yen)

0.10

1.46

1.57

Generated power

2,700 MWh

36,600 MWh

39,300 MWh

* Includes Fukushima Pilot Project (67 buildings, 1.2 MW)

* Sales from selling generated power is included in “Other Businesses” * Generated power corresponds to each period

¥14.6 billion of the funds raised through public offering (¥24.6 billion) used for installments of roof-lease solar power systems. In addition, roof-lease solar power business by our group company utilizing loans from banks is implemented. Total of 4,400

buildings scheduled to be installed by 1H of FY16/3.

Power Producer and Supplier Leopalace Energy

Leopalace Energy Corporation will supply the electricity

generated by Leopalace Power Corporation on apartment rooftops to consumers.

In anticipation of the deregulation of electricity retail in 2016, we plan to supply electricity to our apartments.



Company Profile

Name Leopalace Energy Corporation Capital ¥20 million

(48)

Busan Dalian Beijing

Shanghai

Guangzhou

Taipei

Seoul

Bangkok

Ho Chi Minh Phnom Penh Yangon

6-5

：

New Businesses (Leasing Business Overseas)

Leopalace21 will expand its leasing business overseas. In addition to introducing Japanese apartments to foreigners, we have started foreign real estate brokerage services in Southeast Asia targeting Japanese individuals and companies. Also, we have entered the Korean market through a leasing management venture with local enterprise. We will expand our business in Indonesia and Philippines during FY16/3.

Leasing Business Overseas

China Beijing, Dalian, Guangzhou, Shanghai (2 corporations) South Korea Busan, Seoul*

Taiwan Taipei

Thailand Bangkok

Vietnam Ho Chi Minh, Ha Noi Cambodia Phnom Penh

Myanmar Yangon

Foreign offices, subsidiaries

South Korean JV “Woori & Leo PMC”

 Established with South Korea’s largest

residential property management company

 Woori & Leo PMC will provide South Korea’s first systematic leasing management services

 Full-scale operations started after the local law enactment on February 2014, with 452

managed units as of March 2015

Introduce Japanese apartments

Both business Introduce Japanese

apartments to foreigners

Foreign real estate brokerage targeting Japanese

individuals and companies

Traditional

In the future

-47-Real estate brokerage Ha Noi

(49)

(50)

Individuals and Other 16.73%

Business Corporations and Other Legal Entities

2.51% Foreign Corporations 50.65% Financial Institutions 25.01% Financial Instruments Business Operations (Securities Companies) 3.39% Treasury Stocks 1.71%

-49-App.1-1

：

Corporate Profile

Corporate Data

(as of March 31, 2015)

Shareholder Composition

(as of March 31, 2015)

Group Companies

(as of March 31, 2015) Company Name Leopalace21 Corporation

Head Office 2-54-11 Honcho, Nakano-ku, Tokyo TEL. +81-3-5350-0001 (Main Line) Established August 17, 1973

Paid-in Capital ¥75,282 million*1

President President and CEO Eisei Miyama

Operations

Construction, leasing and sales of apartments, condominiums, and residential housing; development and operation of resort facilities; hotel business; broadband business; and elderly care business, etc. Employees 7,339 (consolidated), 6,149 (non-consolidated)

Authorized Shares 500,000,000

Outstanding Shares 267,443,915*1 Shareholders 39,197

*1: Increase due to public offering and private placement (overallotment)

H o te ls & R e so rt O th e r L e a si n g C o n st ru -ct io n

Woori & Leo PMC

Leasing management in South Korea

Leopalace21 (Thailand)

Real estate brokerage in Thailand Leopalace Leasing Corporate housing agent Leopalace21 Business Consulting (Shanghai) Tenant recruitment LEOPALACE21 VIETNAM

Real estate brokerage in Vietnam

Plaza Guarantee

Rent guarantee

Leopalace21 (Shanghai) Property Management

Real estate brokerage in Shanghai

Leopalace21 (Cambodia)

Real estate brokerage in Cambodia Leopalace Power Power generation Leopalace Guam Resort Business ASUKA SSI

Tenant contents insurance

Azu Life Care

Elderly care service

(51)

-50-(Million yen)

Q1 Apr – Jun

Q2 Jul – Sep

Q3 Oct – Dec

Q4 Jan – Mar

FY14/3 Actual

FY15/3 Actual

FY14/3 Actual

FY15/3 Actual

FY14/3 Actual

FY15/3 Actual

FY14/3 Actual

FY15/3 Actual

Sales 114,876 115,626 116,796 117,411 111,792 117,718 127,624 132,432

Leasing 96,142 98,530 95,733 98,902 96,692 98,921 100,199 102,962

Construction 13,874 11,457 16,540 13,193 10,342 13,043 22,377 23,618

Elderly Care 2,477 2,386 2,572 1,872 2,581 2,287 2,540 2,404

Hotels & Resort 2,037 2,599 1,602 2,676 1,837 2,702 2,093 2,629

Others 343 652 346 766 338 763 413 817

Operating profit 2,009 2,394 3,359 3,693 3,381 3,457 4,922 5,217

Leasing 2,680 4,090 3,520 5,471 5,076 5,586 4,241 5,385

Construction 89 -882 881 -492 -362 -480 2,314 2,065

Elderly Care -196 196 -123 -326 -126 -529 -178 -629

Hotels & Resort 66 -132 -386 -105 -304 -143 -398 -225

Others 84 158 66 104 42 18 -52 -249

App.1-2-1

：

Quarter Comparison

(52)

(Million yen) FY14/3 Actual

FY15/3 Plan

FY15/3

Actual YoY Compared

to Plan

Leopalace21 Sales 469,665 491,500 484,360 +14,694 -7,140

OP 13,332 14,100 15,595 +2,263 +1,495

Leopalace Leasing Sales 1,174 1,500 1,556 +382 +56

OP 7 0 112 +105 +112

Plaza Guarantee Sales 4,391 4,700 4,576 +185 -124

OP 709 500 393 -315 -107

Leopalace Guam Sales 7,333 7,700 8,995 +1,662 +1,295

OP 86 300 61 -24 -239

WING MATE Sales 1,128 1,200 1,341 +213 +141

OP 18 0 -2 -21 -2

ASUKA SSI Sales 1,243 1,300 1,465 +222 +165

OP 166 200 166 +0 -34

Leopalace Power Sales 108 1,000 1,361 +1,253 +361

OP -47 -300 -268 -221 +32

Others & Exclusions

Sales -6,545 -15,400 -20,469 -13,923 -5,069

OP -30 -300 -1,295 -1,264 -995

-51-App.1-2-2

：

Results of Leopalace21 Group

(53)

FY13/3 FY14/3 FY15/3

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Units under management 556,546 551,287 546,561 546,204 546,856 547,161 547,978 548,912 550,514 551,545 552,966 554,948

A. Occupied units 460,231 458,264 449,745 463,222 457,683 461,136 460,961 480,110 473,197 476,163 473,862 495,487

Occupancy rate (average) 82.2% 82.9% 82.5% 84.2%

FY82.9% 83.6% 83.9% 84.2%

86.7%

FY84.6% 86.0% 85.9% 86.0%

88.4% FY86.6%

B. Corporate-occupied units 217,517 217,034 214,450 228,708 226,474 228,038 227,580 246,272 243,588 244,967 242,293 262,577

Corporate share (B / A) 47.3% 47.4% 47.7% 49.4% 49.5% 49.5% 49.4% 51.3% 51.5% 51.4% 51.1% 53.0%

C. Individual-occupied units 181,047 180,365 174,953 176,139 175,057 176,782 176,503 179,036 176,885 178,186 178,228 182,142

Individual share (C / A) 39.3% 39.4% 38.9% 38.0% 38.2% 38.3% 38.3% 37.3% 37.4% 37.4% 37.6% 36.8%

D. Student-occupied units 61,667 60,865 60,342 58,375 56,152 56,316 56,878 54,802 52,724 53,010 53,341 50,768

Students share (D / A) 13.4% 13.3% 13.4% 12.6% 12.3% 12.2% 12.3% 11.4% 11.1% 11.1% 11.3% 10.2%

*Occupancy rate is the average value for each period (full-year or quarter)

*Figures for units under management and occupied units are as of the end of the final month for the relevant period

App.1-3-1

：

Indicator (Occupancy by Group)

Occupancy by Group

(54)

-52-

-53-App.1-3-2

：

Indicator (Occupied Units by Industry)

(Units) Other Construction Food service Services Staffing, outsourcing Manufacturing Retail YoY

Occupied Units by Industry

Leopalace21 will purse strategies of “expanding major business connections” and “cultivating ‘low-use’ business connections” while diversifying industry types of corporate tenants.

+11.6% +11.2% +4.3% +6.6% +10.0% +2.7% +4.5%

YoY +8.2% +4.3% +7.7% +6.6%

43,613 43,942 43,472 46,277 47,510 19,638 24,632 24,570 29,105 32,022

27,869 28,869 30,218

32,995 35,169

32,157 35,601 37,380

39,188 40,878 12,872 13,445 14,710 14,956 16,635 28,074 32,223 35,096 39,783 44,398 38,361 40,527 43,262 43,968 45,965 202,584 219,239 228,708 246,272 262,577 0 50,000 100,000 150,000 200,000 250,000 300,000

(55)

-54-(Units)

FY13/3 FY14/3 FY15/3

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

China 3,938 4,049 4,171 5,035 5,007 5,497 5,654 6,125 5,906 6,297 6,652 7,033

South Korea 1,533 1,490 1,489 1,463 1,441 1,415 1,384 1,298 1,272 1,293 1,325 1,336

Taiwan 675 627 640 652 621 642 651 658 613 618 659 747

Southeast

Asia 622 670 669 766 915 1,195 1,458 1,833 2,018 2,326 2,571 2,859

of which,

Vietnam 103 115 120 166 268 499 723 1,059 1,231 1,496 1,717 1,995 of which,

Thailand 87 87 94 102 89 91 97 95 101 102 107 103

Others 1,438 1,485 1,454 1,601 1,651 1,769 1,845 2,013 1,993 2,133 2,213 2,391

Total 8,206 8,321 8,423 9,517 9,635 10,518 10,992 11,927 11,802 12,667 13,420 14,366

App.1-3-3

：

Indicator (Foreign Tenants)

Units Occupied by Foreign Tenants (

Chintai

**Contracts*)**

*Figures are as of the end of the final month for the relevant period

*Chintaicontracts are long-term (more than one year) leasing contracts with monthly rent payments

(56)

-55-App.1-3-4

：

Indicator (Occupancy Rates by Building Age)

Occupancy Rates by Building Age

(as of March 31, 2015)

Occupancy Rates by Area

(as of March 31, 2015)

95.3% 98.1% 96.3% 96.1% 94.6% _91.5%

87.0% _82.6% 89.3%

0% 50% 100%

1 year 2 years 3 years Under 3 years

Under 5 years

5-10 years 10-15 years Over 15 years

Total

96.4% 97.2% 98.3% _95.2% 96.9% 96.3%

92.0%

97.6%

95.3% 96.4% 96.3% 96.1% 96.5%

94.1% 95.9% 96.1% 94.0% 94.1% 94.1% 95.6% 95.4% _93.0% _92.4%

88.3% 92.5% 93.1% 90.7% 93.3% 89.0% 92.1% 70%

80% 90% 100%

Tokyo Saitama Kanagawa Chiba Tokyo Metro

Aichi Osaka Kyoto Hyogo 3-metro areas

(57)

117 (32%) 108 (26%) 107 (24%) 104 (23%) 114

(24%) _(20%)94 79 (17%) 68 (14%) 58 (12%) 254 306

336 357 365 370 384 412 438 372

414

442 462

478

464 463 480

495 0 50 100 150 200 250 300 350 400 450 500

'07/3 '08/3 '09/3 '10/3 '11/3 '12/3 '13/3 '14/3 '15/3

Chintai (General) Monthly

1. Chintai(General) Contract

• No deposit or brokerage fee

• Monthly payments

• Contracts for more than one year

2. Monthly Contract

• Equipped with basic furniture and appliances

• No utility cost • One-time payment

• Contracts starting from 30 days

-56-App.1-3-5

：

Indicator (Contract Type)

Tenants by Contract Type

Two Types of Contracts

Due to promotion of long-term tenancies, shares of short-term “monthly contracts” have decreased.

(58)

-57-Partner and Direct Offices, and Contracts by -57-Partners

FY13/3 FY14/3 FY15/3

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Partner offices 197 201 195 192 179 172 167 164 152 149 143 141 Direct offices

(domestic) 159 165 172 174 176 176 176 176 179 179 180 180

Total leasing offices 356 366 367 366 355 348 343 340 331 328 323 321

Contracts by Partners 8,881 9,372 9,328 12,422 8,204 8,392 7,972 10,516 6,736 7,079 6,748 9,065

Leasing Offices by Area

(as of March 31, 2015)

Hokkaido Tohoku North Kanto

Tokyo-metro

Hokuriku,

Koshinetsu Chubu Kinki Chugoku Shikoku

Kyushu, Okinawa

Partner offices 3 7 8 39 9 21 16 13 6 19 Direct offices

(domestic) 9 15 14 48 13 23 25 10 5 18

Total leasing

offices 12 22 22 87 22 44 41 23 11 37

App.1-3-6

：

Indicator (Partners Offices and Contracts)

(59)

-58-App.1-3-7

：

Indicator

(Reserve for Apartment Vacancy Loss)

Occupancy Rate

Reserve for Apartment Vacancy Loss

(Billion yen)

Reversal in the reverse for apartment vacancy loss for FY 15/3 was ¥4.0 billion (compared to forecast of ¥3.3 billion) due to “profit improvement” and “passage of remaining periods.” Forecast of reversal for FY16/3 is ¥2.5 billion.

Reserve by Area

32.6 30.1 (-2.4) 26.4 (-3.6) 21.9 (-4.5) 19.2 (-2.7) 17.7 (-1.4) 15.6 (-2.1) 12.9 (-2.6) 13.9 (+1.0) 12.7 (-1.2) 11.6 (-1.1) 9.9 (-1.6) 9.3 (-0.6) 8.7 (-0.6) 7.8 (-0.9) 6.4 (-1.3) 5.2 (-1.1) 0 20 40 FY11/3 Q4 FY12/3 Q1 FY12/3 Q2 FY12/3 Q3 FY12/3 Q4 FY13/3 Q1 FY13/3 Q2 FY13/3 Q3 FY13/3 Q4 FY14/3 Q1 FY14/3 Q2 FY14/3 Q3 FY14/3 Q4 FY15/3 Q1 FY15/3 Q2 FY15/3 Q3 FY15/3 Q4 FY12/3 Reversal ¥13.3 bil FY13/3 Reversal ¥5.2 bil FY14/3 Reversal ¥4.5 bil FY15/3 Reversal ¥4.0 bil

(Billion yen, %)

Managed units (1,000 units) FY14/3 FY15/3 Compared to FY14/3 Q4 FY14/3 Q4 FY15/3 Q4 Diff.

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Hokkaido 14 0.4 0.4 0.4 0.3 0.3 0.3 0.3 0.3 -0.04 78% 79% +1.9p

Tohoku 34 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.0 -0.07 94% 94% +0.5p

North Kanto 40 1.3 1.2 1.1 1.1 1.0 0.9 0.7 0.6 -0.47 83% 85% +2.1p

Tokyo-metro 158 2.2 2.0 1.6 1.2 1.1 0.9 0.7 0.6 -0.60 91% 92% +1.5p Hokuriku, Koshinetsu 41 1.3 1.1 0.9 1.2 1.2 1.0 0.8 0.5 -0.71 80% 84% +4.4p

Chubu 87 4.6 4.2 3.6 3.5 3.2 2.9 2.4 2.0 -1.46 84% 86% +2.9p

Kinki 79 1.6 1.5 1.2 1.0 1.0 0.8 0.7 0.7 -0.35 88% 90% +2.0p

Chugoku 38 0.2 0.2 0.2 0.1 0.1 0.1 0.1 0.0 -0.08 90% 91% +1.3p

Shikoku 14 0.2 0.2 0.2 0.2 0.3 0.2 0.1 0.0 -0.20 83% 84% +0.3p

Kyushu, Okinawa 49 0.3 0.2 0.2 0.1 0.1 0.1 0.1 0.1 -0.06 91% 91% -0.1p

(60)

-59-App.1-3-8

：

Indicator (“Azumi En” Area Disposition)

Elderly Care Facilities “Azumi En” Area Disposition

(63 as of March 31, 2015)

Sekikawa Horigome Ota Tatebayashi Hanyu Kanuma Utsunomiya Yaita Shimodate Yuki Koga Kogachuou Iwai Nogi Shinkoga Tsuchiura Kokinu Yanagisawa Showa Minamisakurai Ina Kitamoto Gyoda Higashimatsuyama Honjyo Chichibu Ome Hirasawa Tatemachi _Nakano Yamakita Tsurumaki Tsukuihama Ichihara Ichihara Oyumi Katsuragi Wakaba Ino Takaoka Nakazawa Namikicho Misaki Takatsukashinden Tokiwadaira Sakasai Abiko Takamihara Komakidai Souka Irumagawa Sayama Komuro Mizuho Mihashi Goseki Hanasakinooka Ageo Yoshikawa Gamou Yashio Gunma Saitama Tokyo Kanagawa Chiba Ibaraki

Tochigi (Number of facilities)

T o kyo K a n a g a w a C h ib a S a ita m a T o ch ig i Ib a ra ki G u n m a T o ta l

Facilities which include elderly homes with nursing care services

1 1 1 2 2 7

Facilities which include

residential style elderly homes 1 5 2 3 2 1 14 Day-services and Short-stays 2 1 11 18 1 6 1 40

Group homes 1 1 2

Total 4 3 18 22 6 8 2 63

★ Elderly homes with nursing care services, Day-services, Short-stays

Elderly homes with nursing care services, Short-stays

■ Elderly homes with nursing care services, Day-services ● Elderly homes with nursing care services

★ Residential style elderly homes, Day-services, Short-stays Residential style elderly homes, Short-stays

● Residential style elderly homes ○ Group homes

▲ Day-services, Short-stays ● Day-services

Legend

▲Kisarazu

“Azumi En Kisarazu” (the first elderly care facility managed by subsidiary “Azu Life Care”) opened on November 1, 2014 and “Azumi En Shimizukoen” opened on March 1, 2015.

(61)

-60-App.1-4-1

：

Finance (Balance Sheets)

(Million yen) FY14/3 FY15/3

A

s

e

ts

Cash and cash equivalents 74,767 75,221

Trade receivables 5,490 6,254

Accounts receivables for

completed projects 1,651 1,714

Prepaid expenses 6,679 3,656

Deferred tax assets(short-term) 4,147 4,447

Current assets 102,324 102,263

Buildings and structures 57,073 59,899

Machinery, equipment, and vehicles 3,950 15,115

Land 81,800 83,289

Leased assets 5,167 7,880

Intangible assets 6,601 8,894

Long-term prepaid expenses 3,719 3,416

Deferred tax assets(long-term) 12,152 14,654

Fixed assets 185,100 205,887

Total assets 287,459 308,274

(Million yen) FY14/3 FY15/3

L ia b ilit ie s

Interest-bearing debt (short-term) 3,500 24,525

Accounts payable for completed projects 12,128 14,049

Advances received 45,051 40,781

Current liabilities 92,560 116,521

Interest-bearing debt (long-term) 27,997 11,156

Reserve for apartment vacancy loss 9,352 5,280

Lease/guarantee deposits received 8,492 8,019

Long-term advances received 27,628 22,198

Long-term liabilities 90,037 65,279

Total liabilities 182,598 181,801

N e t a s s e ts

Common stock 75,282 75,282

Capital surplus 51,501 51,501

Retained earnings -15,788 427

Total net assets 104,860 126,473

Shareholders’ equity ratio 36.5% 41.0%

(62)

-61-App.1-4-2

：

Finance (Cash / Deposits and Interest-bearing Debt)

NDE Ratio

*Net DE ratio = (Interest-bearing debt – Cash) / Shareholders’ equity

48.3 _46.8

31.4

35.6 41.4

56.6

74.7 75.2

0.20

-0.17

-0.41

-0.31

-0.60 -0.40 -0.20 0.00 0.20 0.40

0 20 40 60 80

FY12/3 FY13/3 FY14/3 FY15/3

(Ratio) (Billion yen)

(63)

-62-App.1-4-3

：

Finance (Cash Flows)

Cash Flows

Cash outflow from investing activities is mainly due to solar power system installments.

(Billion yen) (Billion yen)

1.7

-17.5 15.7

8.8

-6.9 15.5

-20 -15 -10 -5 0 5 10 15 20

Cash flows from financing activities Cash flows from

investing activities Cash flows from

operating activities

74.5 74.1

0 20 40 60 80

Cash and cash equivalents at end of period

(64)

-63-App.1-4-4

：

Indicator (Shareholder Composition)

*Based on number of stock

Shareholder Composition

2011/3 2011/9 2012/3 2012/9 2013/3 2013/9 2014/3 2014/9 2015/3

Individuals and other 60.7% 43.3% 35.2% 33.2% 27.5% 19.8% 20.7% 17.1% 16.7%

Foreign corporations 11.3% 27.8% 35.2% 34.3% 42.8% 48.6% 49.1% 46.8% 50.7%

Trust banks 4.9% 8.4% 8.3% 11.8% 12.8% 17.5% 17.6% 23.6% 23.2%

Financial institutions other than trust banks 3.8% 3.4% 3.4% 3.3% 3.6% 2.5% 1.7% 1.9% 1.9% Business corporations and other legal entities 14.1% 13.0% 12.7% 12.3% 7.8% 7.8% 6.9% 6.6% 2.5%

Securities companies 2.6% 1.4% 2.7% 2.6% 3.5% 1.7% 2.4% 2.3% 3.4%

Treasury stock 2.6% 2.6% 2.6% 2.5% 2.1% 2.1% 1.7% 1.7% 1.7%

(65)

Appendix 2.

(66)

-65-App.2-1

：

Business and Financial Strategies

Business Strategies

Financial Strategies

Leasing Improve occupancy rates by expanding tenant services FY March 2017:

Annual average occupancy rate 89.0%

Construction Expand construction variations based on “ideal land usage” FY March 2017:

Forecast sales ¥100 billion

Elderly Care Open new facilities in collaboration with the Construction business March 2014: 61 facilities

⇒March 2017: 90 facilities

Hotels & Resort High quality hospitality to stakeholders

Solar Power

(Other)

Start roof-lease solar power business utilizing funds raised through public offering

FY March 2015:

Installments/generation on 2,900 buildings

Overseas

(Leasing, Other)

Start real estate brokerage services in Asia

Considering development and operations of service apartments

March 2014: 10 locations

⇒March 2017: 20 locations

Basic policy: “Focus on core businesses and challenging itself with new business fields”

Management emphasizing cash flows

Strengthen soundness of financial structure

(Improve shareholders’ equity ratio)

FY March 2017: Shareholders’ equity ratio 48.0% Active reinvesting in growth areas

Resumption of dividends Achieve positive retained earnings (non-consolidated) by stacking up profits