fiscal period ended july 2016 (3rd fiscal period)...

Fiscal Period Ended July 2016 (3rd Fiscal Period)

Financial Results Briefing Materials

Securities Code: 3455

Asset Management Company

Table of Contents

I. About Healthcare & Medical Investment Corporation (from P2) 1. Investment Philosophy 2. Four Features II. Financial Summary (from P5) 1. 3rd Fiscal Period Topics 2. 3rd Fiscal Period Financial Highlights 3. 4th Fiscal Period and 5th Fiscal Period Earnings Forecast 4. Financial Status III. Portfolio Management Status (from P12) 1. Properties Acquired in 3rd Fiscal Period 2. Portfolio Highlights 3. Portfolio Map 4. Portfolio List 5. Operator List IV. External Growth Strategy (from P19) 1. Road Map to External Growth 2. Pipeline Status 3. Action Strategy 4. Action Case Examples

V. Appendix (from P24) 1. Environment Surrounding Healthcare Facilities (Facilities and Housing for the Elderly) 2. Environment Surrounding Healthcare Facilities (Medical Service-Related Facilities) 3. Detailed Portfolio List 4. Overview of Operators 5. Status of Unitholders 6. Overview of Unitholder Special Benefit Plan 7. Information related to Investment Units 8. HCM’s Network 9. Profile of Asset Management Company 10. Profile of Major Sponsors

1

2

I. About Healthcare & Medical Investment Corporation

Serve as a conduit between the nursing care and medical service industries and the capital markets

1. Investment Philosophy

3

We seek to realize a society where all people can live vibrantly and with peace of mind

Contribute to an aging society

Promote the supply of healthcare facilities as social infrastructure

Develop a portfolio specialized in healthcare facilities, for which demand is expected to grow

Maximize unitholder value over the medium and long term

1

Stable asset management base utilizing the sponsors’ functions and know-how 2

Stable cash flow based on long-term fixed-rent lease agreements 4

Aim to serve as a conduit between the nursing care and medical service industries and the capital markets by steadily investing in and holding healthcare facilities, which must be upgraded and expanded, and thereby contribute to the aging society

Conduct stable asset management and expand its portfolio in the medium to long term by proactively utilizing the strength of the main sponsors, which have expertise in “nursing care and medical service,” “fund management” and “finance”

3

Aim to secure stable revenues over the medium to long term by concluding long-term fixed-rent lease agreements with carefully-selected credible operators and through continuous monitoring

Focused investment in healthcare facilities, for which demand is expected to grow

2. Four Features

4

Secure acquisition opportunities by utilizing extensive networks Secure opportunities to acquire healthcare facilities by utilizing the extensive networks of sponsors, supporting companies and the asset management company as well as the warehousing function and first refusal rights provided in the support agreements, etc.

II. Financial Summary

5

Property name Bonsejour Yotsugi Medical Home

Bonsejour Itami Acquisition price (Note 1)

824 million yen 514 million yen

1. 3rd Fiscal Period Topics

Number of properties: 18 properties (+2 properties from previous fiscal period)

Total acquisition price: 25.0 billion yen (+1.3 billion yen from previous fiscal period)

Distribution per unit: 2,340 yen (forecast: 2,100 yen; +11.4% from forecast) (Note 2)

Acquired 2 paid nursing homes by utilizing borrowings and cash reserves on March 30, 2016

6

0.35％（△0.05％）

1.1 years（△0.6 years） 50.2％（+1.8％）

New Property Acquisition

Management Performance

(Note 1)Acquisition price does not include acquisition expenses, consumption tax, etc. (Note 2)The forecast, which is the forecast at the previous fiscal period’s settlement of accounts, is the forecast figure disclosed in the Financial Report for the 2nd Fiscal Period dated March 15, 2016. (Note 3)LTV is the ratio of interest-bearing liabilities to total assets, rounded to the first decimal place. (Note 4)Each is the weighted average based on the loan amount, rounded down to or at two decimal places.

Period-End Financial Status (Comparison with Previous Fiscal Period)

Loan balance 14.0 billion yen

(+1.0 billion yen)

LTV (Note 3)

Average borrowing interest rate (Note 4)

Average remaining term to maturity (Note 4)

2-1. 3rd Fiscal Period Financial Highlights2

2nd Fiscal Period (Ended Jan. 2016)

3rd Fiscal Period (Ended July 2016)

Actual Forecast (Note) Actual Comparison

with Forecast

Comparison with 2nd Fiscal

Period

（A）（B) （C）（C-B）（C-A）

Operating revenue 745 745 771 +26 +26

Operating expenses 361 432 429 △2 +67

Expenses related to rent business 222 284 283 △1 +61

(Depreciation) 195 197 202 +5 +6

Operating income 383 313 342 +28 △41

Ordinary income 329 254 282 +28 △46

Net income 328 253 281 +28 △46

Distribution per unit (yen) 2,730 2,100 2,340 +240 △390

(Note)The forecast for the 3rd Fiscal Period (B) is the forecast figure announced in the Financial Report for the 2nd Fiscal Period dated March 15, 2016.

Main Factors of Difference (Comparison with Forecast)

Difference in operating revenue (+26) ✓Increase in rent income due to property acquisition (+26)

Difference in operating expenses (-2) ✓Decrease in expenses related to rent business (-1) ・Repair expenses (-6) ・Depreciation (+5) ✓Other expenses (-1) ・Decrease in property taxes, advertising expenses, etc.

Statement of Income (Unit: million yen)

7

Main Factors of Difference (Comparison with 2nd Fiscal Period)

Difference in operating revenue (+26) ✓Increase in rent income due to property acquisition (+26) Difference in operating expenses (+67) ✓Increase in expenses related to rent business (+61) ・Fixed asset tax and city planning tax (+49) ・Depreciation (+6)

Decrease in non-operating income (-6) ・Decrease in insurance income (-6)

2nd Fiscal Period (As of End of

Jan. 2016) (A)

3rd Fiscal Period (As of End of

July 2016) (B)

Difference

(B)-(A)

Assets

Current assets 2,014 1,848 △165

Cash and deposits (Note 1) 1,959 1,796 △162

Other 54 52 △2

Non-current assets 24,837 26,030 +1,193

Property, plant and equipment 24,781 25,994 +1,212

Buildings in trust (Note 2) 14,194 14,663 +468

Accumulated depreciation △358 △560 △202

Land in trust 10,944 11,891 +946

Intangible assets 7 6 △0

Investments and other assets 48 29 △18

Deferred assets 23 17 △5

Total assets 26,874 27,896 +1,022

2nd Fiscal Period (As of End of

Jan. 2016) (A)

3rd Fiscal Period (As of End of

July 2016) (B)

Difference

(B)-(A)

Liabilities

Current liabilities 236 7,269 +7,033

Short-term loans payable - 1,000 +1,000

Current portion of long-term loans payable - 6,000 +6,000

Other 236 269 +33

Non-current liabilities 13,595 7,631 △5,964

Long-term loans payable 13,000 7,000 △6,000

Tenant leasehold and security deposits 595 631 +35

Total liabilities 13,831 14,901 +1,069

Net assets Unitholders’ capital 12,713 12,713 0

Unappropriated retained earnings 329 282 △46

Total net assets 13,042 12,995 △46

Total liabilities and net assets

26,874 27,896 +1,022

(Note 1)Cash and deposits includes cash and deposits in trust. (Note 2)Buildings in trust includes facilities attached to buildings in trust, structures in trust, and tools, furniture and fixtures in trust.

2-2. 3rd Fiscal Period Financial Highlights

Balance Sheet

8

(Unit: million yen) (Unit: million yen)

3. 4th Fiscal Period and 5th Fiscal Period Earnings Forecast

3rd Fiscal Period (Ended July 2016)

4th Fiscal Period (Ending Jan. 2017)

5th Fiscal Period (Ending July 2017)

Actual Forecast Comparison with 3rd Fiscal Period

Actual Forecast

Comparison with 4th Fiscal Period

Forecast

（A）（B）（B-A）（C）（C-B）

Operating revenue 771 784 +12 784 0

Operating expenses 429 439 +10 435 △4

Expenses related to rent business 283 288 +5 290 +2

(Depreciation) 202 204 +2 205 +0

Operating income 342 344 +2 348 +4

Ordinary income 282 285 +2 279 △5

Net income 281 284 +2 278 △5

Distribution per unit (yen) 2,340 2,360 +20 2,310 △50 610

2,730 2,340 2,360 2,310

0

500

1,000

1,500

2,000

2,500

3,000

第1期第2期第3期第4期第5期

4th Fiscal Period Forecast (Comparison with 3rd Fiscal Period Actual)

◆ Difference in operating revenue (+12) ・Full-period contribution of rent income from properties acquired in 3rd Fiscal Period (+12) Difference in operating expenses (+10) ✓Difference in expenses related to rent business (+5) ・Depreciation (+2) ・Repair expenses (+2) ✓Difference in other expenses (+5) ・Asset management fee (+3) ・Expenses related to general meeting of unitholders (+4) ・Property taxes, etc. (-2)

5th Fiscal Period Forecast (Comparison with 4th Fiscal Period Forecast)

Difference in operating expenses (-4) ・Increase in fixed asset tax and city planning tax (+2) ・Absence of expenses related to general meeting of unitholders (-4) Difference in non-operating expenses (+9) ・Increase in refinancing related expenses, and interest expenses due to conversion into longer terms and fixed rates (+9)

Statement of Income

9

(Unit: million yen)

1st FP 2nd FP 3rd FP 4th FP 5th FP

2,500 2,100

Initial Forecast Actual Forecast

Changes in Distribution Per Unit (yen)

(Note)The forecast figures are based on the assumption that there will be no new property acquisition.

4-1. Financial Status

Category Lender Drawdown Date

Balance (million yen)

Interest Rate Maturity

Short-term

Loans

SMBC March 30, 2016

1,000

Base interest rate （Note１）

+ 0.25％

March 21, 2017

Long-term loans

SMBC Nippon Life insurance Resona Bank Shinkin Central Bank Nishi-Nippon City Bank Higashi-Nippon Bank Bank of Fukuoka Mie Bank

March 20, 2015

6,000

Base interest rate （Note１）

+ 0.20%

March 21, 2017

SMBC Sumitomo Mitsui Trust Bank Nippon Life insurance Resona Bank 77 Bank Dai-ichi-life Insurance Hiroshima Bank

March 20, 2015

7,000 0.466% （Note２）

March 20, 2018

合計 14,000 ― ―

(Note 1)The base interest rate shall be the one-month tenor rate of the JBA Japanese Yen TIBOR. (Note 2)An interest rate swap agreement was concluded with Sumitomo Mitsui Trust Bank on March 20, 2015 for the purpose of hedging future interest rate fluctuation risk. Therefore, the

interest rate that is, in effect, fixed by the agreement is shown in place of the floating interest rate.

SMBC 43%

Sumitomo Mitsui Trust Bank

14％

Nippon Life Insurance

７％

Resona Bank ７％

Shinkin Central Bank ４％

Dai-ichi-Life Insurance

４％

Nishi-Nippon City Bank

４％

Higashi-Nippon Bank ４％

Bank of Fukuoka ４％

Mie Bank ４％

77 Bank ４％

Hiroshima Bank ４％

10

Total Amount 14,000 million yen

2.2 years

1.7 Years

1.1 Years

0.40％ 0.40％

0.35％ 0.34

0.36

0.38

0.40

0.42

0

0.5

1

1.5

2

2.5

1st FP 2nd FP 3rd FP

7.1%

42.9% 50.0% Ratio of Long Term

to Short Term

Short term Long term(current potion) Long term

50% 50% Ratio of Floating

Rate to Fixed Rate

4-2. Financial Status

Average Remaining Term to Maturity, and Average Borrowing Interest Rate (Note 2)

Changes in LTV

109,606

114,973 117,414

100,000

105,000

110,000

115,000

120,000

第１期第２期第３期

(years)

（yen) ）

（％）

11

Floating-borrowing rate

(Note 1)Each indicator is a calculation of the figures as at the end of each fiscal period and is, in principle, rounded to the first decimal place. (Note 2)Average remaining term to maturity is rounded down to the first decimal place, and average borrowing interest rate is rounded down to two decimal places. (Note 3)NAV per unit is rounded down to the nearest whole number.

（％）

48.8 48.4

50.2

47

48

49

50

51


Ratio of Floating Rate to Fixed Rate, and Ratio of Long Term to Short Term

Fixed-borrowing rate

Changes in NAV (Note 3)


III. Portfolio Management Status

12

1. Properties Acquired in 3rd Fiscal Period

Property Name Bonsejour Yotsugi

Location 3-1-11, Higashiyotsugi, Katsushika-ku, Tokyo

Operator Benesse Style Care

Type Paid nursing home with care service

Number of Rooms /Resident Capacity 61 rooms/65 people

Acquisition Price 824 million yen

Appraisal Value at Time Acquisition 855 million yen

Appraisal NOI Yield (Note) 5.8％

Seller Healthcare Bridge 1-Go Godo Kaisha

Property Characteristics

・The property is located an approximate nine minute walk from Yotsugi station on the Keisei Railway Oshiage Line. There is a friendly atmosphere of downtown and a quiet residential area. The nursing occupants can feel close to Ayase River and Naka River, and together with large or small parks scattered nearby the facility, they will be able to expect rich lifestyle. ・With a lounge space and family room in the common area, consideration is given to the comfortable living for occupants.

Property Name Medical Home Bonsejour Itami

Location 1-2-25, Chuo, Itami-shi, Hyogo

Operator Benesse Style Care

Type Housing-type paid nursing home

Number of Rooms /Resident Capacity 62 rooms/64 people

Acquisition Price 514 millon yen

Appraisal Value at Time Acquisition 539 million yen

Appraisal NOI Yield (Note) 7.2％

Seller Healthcare Bridge 1-Go Godo Kaisha

Property Characteristics

・The property is located in a commercial area an approximate two minute walk from the East exit of the Hankyu Railway Itami Line terminal Itami Station. ・Nursing staff is stationed 24 hours a day.

13 (Note)Appraisal NOI yield is appraisal value at time of acquisition divided by acquisition price, rounded to the first decimal place.

Three Major metropolitan

areas

86.9％

Chubu area

5.1％

Tokyo metropolitan area

59.4％

Kinki area

22.4％

Core cities

11.6％

Other area

1.6％

2. Portfolio Highlights

By type By Geographical Area

By Operator

12.5％

Paid nursing home

87.5％

Sompo Care Next

26.5％

Benesse Style Care

21.8％ Sawayaka Club

13.1％

Sompo Care Message

12.5％

AS PARTNERS

11.3％

GREEN LIFE

7.8％

JAPAN LIFE DESIGN

7.0％

Number of Properties

18 properties

(Note)The figures for By Type, By Geographical Area and By Operator are calculated on an acquisition price basis, rounded to the first decimal place.

Total Acquisition Price

25.0 billion yen

Total Appraisal Value

27.1 billion yen

Occupancy Rate

100％

Average Building Age

17.4 years

Average Remaining Lease Term

12.8 years

Number of Operators

７ companies

Unrealized Gain/Loss

+1.1 billion yen （+0.3 billion yen from previous fiscal period）

Portfolio Diversification

14

Serviced housing for the elderly

14

4

1 9

3 6

5

2

7

8 17

10

11

13

12

18

14

15

16

1 Bonsejour Chitose-funabashi

Bonsejour Musashi-shinjo

3 Bonsejour Hino 2

Medical Rehabilitation Home Bonsejour Hadanoshibusawa

4 SOMPO CARE La vie Re Machidaonoji

5 6

ASHEIM Hikarigaoka 7 ASHEIM Bunkyohakusan

8 GOOD TIME HOME Fudo-mae

9

Bonsejour Yotsugi 17

Kinki area 22.4％

Other area

1.6％ 5.1％

Medical Rehabilitation Home Bonsejour Komaki

13

Chubu area

11.6％

SAWAYAKA Tachibanakan 14 SAWAYAKA Mekarikan 16 SAWAYAKA Tagawakan

15

Tokyo metropolitan area 59.4％

AQUAMARINE Nishinomiyhama

10

Medical Home Bonsejour Itami

18

11 Sompo no ie S Awajiekimae

Sompo no ie S Kobekamisawa 12

3. Portfolio Map

Strategic investment in three major metropolitan areas

86.9％

15

(Before acquisition of 2 properties: 86.1%)

Ratio of investment in three major metropolitan areas

SOMPO CARE La vie Re Azamino

Core cities

Properties acquired in 3rd Fiscal Period

Operator Name Property Name Type of Facility Location Acquisition Price(Note1) Appraisal Value

(million yen) (Note3)

Appraisal NOI (million yen)

(Note4) Price

(million yen) Ratio

(Note2)

GREEN LIFE AQUAMARINE Nishinomiyahama Paid nursing home with care service

Nishinomiya-shi, Hyogo 1,950 7.8 2,160 121

Benesse Style Care

Bonsejour Chitose-funabashi Paid nursing home with care service

Setagaya-ku, Tokyo 824 3.3 958 49

Bonsejour Hino Paid nursing home with care service

Hino-shi, Tokyo 724 2.9 806 43

Bonsejour Musashishinjo Paid nursing home with care service

Kawasaki-shi, Tokyo 582 2.3 633 36

Medical Rehabilitation Home Bonsejour Hadanoshibusawa

Paid nursing home with care service

Hadano-shi, Kanagawa 728 2.9 838 47

Medical Rehabilitation Home Bonsejour Komaki Housing-type paid nursing home Komaki-shi,

Aichi 1,270 5.1 1,430 92

Bonsejour Yotsugi Paid nursing home with care service

Katsushika-ku, Tokyo 824 3.3 872 48

Medical Bonsejour Itami Housing-type paid nursing home Itami-shi, Hyogo 514 2.1 550 36

AS PARTNERS ASHEIM Higarigaoka Paid nursing home with care

service Nerima-ku, Tokyo 1,385 5.5 1,540 76

ASHEIM Bunkyohakusan Paid nursing home with care service

Bunkyo-ku, Tokyo 1,430 5.7 1,590 72

Sompo Care Next

SOMPO CARE La vie Re Machidaonoji


Machida-shi, Tokyo 3,580 14.3 3,750 192

SOMPO CARE La vie Re Azaminio


Yokohama-shi, Kanagawa 3,050 12.2 3,210 156

Sawayaka Club

SAWAYAKA Tachibanakan Paid nursing home with care service

Fukuoka-shi, Fukuoka 1,520 6.1 1,580 95

SAWAYAKA Mekarikan Paid nursing home with care service

Kitakyushu-shi, Fukuoka 1,380 5.5 1,460 87

SAWAYAKA Tagawakan Paid nursing home with care service

Tagawa-shi, Fukuoka 390 1.6 410 25

JAPAN LIFE DESIGN GOOD TIME HOME Fudo-mae Paid nursing home with care service

Shinagawa-ku, Tokyo 1,740 7.0 1,910 92

Sompo Care Message （Note5）

Sompo no ie S Awajiekimae Serviced housing for the elderly Osaka-shi, Osaka 1,930 7.7 2,130 116

Sompo no ie S Kobekamisawa Serviced housing for the elderly Kobe-shi, Hyogo 1,200 4.8 1,320 72

Total 25,021 100.0 27,147 1,463

(Note 1)Acquisition price does not include acquisition expenses, consumption tax, etc. (Note 2)“Ratio” is calculated on an acquisition price basis, rounded to the first decimal place. (Note 3)“Appraisal Value” is the value with July 31, 2016 as the date of value. (Note 4)“Appraisal NOI” is rounded down to the nearest million yen. (Note 5)Message Co., Ltd. became a consolidated subsidiary of Sompo Japan Nipponkoa Holdings, Inc. on March 7, 2016 and changed its company name to Sompo Care Message Inc. on July 1, 2016. Sompo Japan Nipponkoa Holdings, Inc. changed its company name to Sompo Holdings, Inc. on October 1, 2016. The same shall apply hereinafter in this document.

4-1. Portfolio List


16

Property Name Number of Rooms (rooms)

Resident Capacity (people)

Occupancy Rate (%)

Date of Figures Source

AQUAMARINE Nishinomiyahama 90 100 97.0 June 2016 Disclosure statement Bonsejour Chitose-funabashi 42 47 92.9 Jan.2016 Independent survey (Note 1) Bonsejour Hino 56 58 89.3 Jan.2016 Independent survey (Note 1) Bonsejour Musashishinjo 46 49 89.1 Jan.2016 Independent survey (Note 1) Medical Rehabilitation Home Bonsejour Hadanoshibusawa 100 101 88.0 Jan.2016 Independent survey (Note 1) Medical Rehabilitation Home Bonsejour Komaki 123 166 92.7 Jan.2016 Independent survey (Note 1)

Bonsejour Yotsugi 61 65 93.4 Jan.2016 Independent survey (Note 1) Medical Bonsejour Itami 62 64 95.2 Jan.2016 Independent survey (Note 1) ASHEIM Higarigaoka 83 89 95.5 July 2016 Disclosure statement ASHEIM Bunkyohakusan 50 52 88.5 July 2016 Disclosure statement SOMPO CARE La vie Re Machidaonoji 163 169 65.1 July 2016 Disclosure statement SOMPO CARE La vie Re Azaminio 145 145 65.5 July 2016 Disclosure statement

SAWAYAKA Tachibanakan 104 104 97.1 July 2016 Disclosure statement SAWAYAKA Mekarikan 95 95 97.9 July 2016 Disclosure statement SAWAYAKA Tagawakan 60 60 96.7 July 2016 Disclosure statement GOOD TIME HOME Fudo-mae 61 67 88.1 July 2016 Disclosure statement Sompo no ie S Awajiekimae 137 137 94.2 - Property website (Note 3) Sompo no ie S Kobekamisawa 85 85 76.5 - Property website (Note 3)

合計 1,563 1,653

Occupancy Rate By Property

4-2. Portfolio List


17

(Note 1)The occupancy rate is the occupancy rate based on a survey conducted by Tamura Planning & Operating Co., Ltd. (hereinafter referred to as “Tamura Planning”). Calculation of the occupancy rate by Tamura Planning is based on number of rooms, while calculation of the occupancy rate in the Property Disclosure Statement of Important Issues is on a resident capacity basis. Accordingly, the Property Disclosure Statement of Important Issues and actual figures may differ. (Note 2)The number of rooms as serviced housing for the elderly is 136 rooms. The same shall apply hereinafter in this document. (Note 3)The occupancy rate is the occupancy rate estimated by the asset management company based on the number of rooms as at the end of July 2016 disclosed on the property website. Accordingly, it may differ from the actual occupancy rate.

Operator Name Founded

Number of Facilities under Management (Note 1)

Public Listing Remarks

Benesse Style Care Co., Ltd. Sept.1995 295 Consolidated subsidiary of Benesse Holdings,

Inc., which is listed on the TSE First Section

The company operates seven brands in Tokyo, Osaka, Nagoya, and elsewhere in Japan. The brands are mainly mid- to high-end, such as Bonsejour and GRANDA.

Sompo Care Next Inc. Nov. 1992 116 Consolidated subsidiary of Sompo Holdings,

Inc., which is listed on the TSE First Section

The company mainly operates paid nursing homes with care service for the elderly under the Sompo Care La vie Re brand, mainly in the Greater Tokyo Area. Formerly, Watami No Kaigo Co., Ltd.

GREEN LIFE Inc. May 1994 24 Consolidated subsidiary of SHIP HEALTHCARE HOLDINGS, INC., which is listed on the TSE First Section

The company is a company engaged in the nursing care business that undertakes the Lifecare Business of SHIP HEALTHCARE HOLDINGS, INC. (all 67 facilities) together with GREEN LIFE HIGASHI NIHON Inc. and other companies.

Sawayaka Club Co., Ltd. Dec. 2004 67

Consolidated subsidiary of UCHIYAMA HOLDINGS Co., Ltd., which is listed on the TSE First Section

The company operates low-price facilities with no upfront entrance fees under the SAWAYAKA brand in Fukuoka Prefecture and elsewhere in Japan.

AS PARTNERS Co., Ltd. Nov. 2004 14 Not publicly listed The company operates paid nursing homes and day service facilities

under the ASHEIM brand in the Greater Tokyo Area.

JAPAN LIFEDESIGN Inc. Apr. 2004 ３ Not publicly listed

The company operates paid nursing homes under the GOOD TIME HOME brand in Tokyo. Including the facilities of SOUSEI JIGYOUDAN Co., Ltd., the parent company, the company operates 31 facilities. (Note 2)

Sompo Care Message Inc. May 1997 334

・Listed on the TSE JASDAQ Market ・Consolidated subsidiary of Sompo Holdings, Inc., which is listed on the TSE First Section

The company operates mid- to low-end paid nursing homes under the Sompo no ie brand and serviced housing for the elderly under the Sompo no ie S brand, mainly in Tokyo, Osaka, Nagoya, and also elsewhere in Japan. Formerly, Message Co., Ltd.

5. Operator List

18

(Note 1)“Number of Facilities under Management” is obtained from the kessan tanshin (financial report) for the first quarter of fiscal year ending March 2017 of Benesse Holdings, Inc. in the case of Benesse Style Care Co., Ltd., and each company’s website (as at the end of July 2016) in the case of Sompo Care Next Inc., GREEN LIFE Co., Ltd., Sawayaka Club Co., Ltd., AS PARTNERS Co., Ltd., JAPAN LIFEDESIGN Inc. and Sompo Care Message Inc. (Note 2)The number of facilities of SOUSEI JIGYOUDAN Co., Ltd. is obtained from its website (as at the end of July 2016).

IV. External Growth Strategy

19

1. Road Map to External Growth

Further expansion of

asset size

（March 2015）

(March 2016）

50.0 billion yen

IPO 1year later 3 year later 5 year later

100.0 billion yen

Medium-Term Target Asset Size

23.6 billion yen

(Note 1)The targets announced in the financial results briefing materials dated March 16, 2016. Future events, market environment, etc. may lead to these not being achieved. (Note 2)The properties acquired by sponsor-arranged bridge SPCs (HC Vega and HC Altair). These are not assets that HCM has decided to acquire and there is also no guarantee that HCM will be able to acquire these in the future. (Note 3)The appraisal values as at the end of August 2014 obtained by the bridge SPCs.

20

Aim for 50 billion yen in 3 years after the IPO and 100 billion yen in 5 years after the IPO (Note 1)

Acquired Bonsejour Yotsugi Medical Home Bonsejour Itami

First refusal rights obtained (Note 2)

14 properties / Approx. 33.6 billion yen (Note 3)

25.0 billion yen

(Note 1)“Operator” is the main tenant. (Note 2)The properties for which first refusal rights have been obtained are not assets that HCM has decided to acquire and there is also no guarantee that HCM will be able to acquire these in the future.

2. Pipeline Status

21

Properties Held by Bridge SPCs (First Refusal Rights Obtained)

Property name SHIP Senri Building Kobe Gakuentoshi Building GRANDA Tsuruma Yamato

Operator (Note1) GREEN LIFE GREEN LIFE Benesse Style Care

Location Toyonaka-shi, Osaka Kobe-shi, Hyogo Yamato-shi, Kanagawa

Major Facilities Paid nursing home with care service

Hospital Paid nursing home with care service

Clinic Paid nursing home with care service

Property Name Operator Location Type of Facility

Moriguchisata Lagale GREENLIFE Moriguchi-shi, Osaka Paid nursing home with care service

Hapine Kobe Uozaki Ⅱ GREENLIFE Kobe-shi, Hyogo Paid nursing home with care service

SOMPO CARE La vie Re Hama-Kawasaki Sompo Care Next Kawasaki-shi, Kanagawa Paid nursing home with care service

Hanakotoba Shin-Yokohama Yuuai Yokohama-shi, Kanagawa Paid nursing home with care service

Hanakotoba Shin-Yokohama Ⅱ Yuuai Yokohama-shi, Kanagawa Paid nursing home with care service

Hanakotoba Miura Manyou Miura-shi, Kanagawa Paid nursing home with care service

Hanakotoba Odawara Manyou Odawara-shi,Kanagawa Paid nursing home with care service

Hanakotoba Minami Manyou Yokohama-shi, Kanagawa Paid nursing home with care service

LONGLIFE Kobe Aotani JAPAN LONGLIFE Kobe-shi, Hyogo Paid nursing home with care service

Verge Minowa Verge Takasaki-shi, Gunma Paid nursing home with care service

Verge Hotaka Verge Kawaba-mura, Tone-gun, Gunma Paid nursing home with care service

3. Action Strategy

Build Structure Pooling Quality Properties and Information by Utilizing Extensive Networks

Utilization of warehousing function and first refusal rights

22 (Note)HAM stands for Healthcare Asset Management Co., Ltd.

Asset management company’s (HAM’s)own network Sponsors’ and supporting companies’ networks

Facilities and housing for the elderly

(properties in operation)

Facilities and housing for the elderly

(after new development/construction)

Medical service-related facilities

Case Examples of Actions for Expansion of Asset Size

Captured the needs for new development of paid nursing homes of operator A.

Partnered with operator A and developer. Held (warehousing) by sponsor B after completion of construction for the period until occupancy becomes stable.

The asset management company captured the operator’s paid nursing home (extension underway) liquidity needs. Acquired (warehousing) by sponsor C after completion of construction of the extension.

4. Action Case Examples

Case Example 1: Development Property

Case Example 2: Property in Operation

Ｈ

CM

23

Lease agreement

Case Example 3: Property in Operation

Operator A

Facility development

Developer

Sponsor B

First refusal rights to be obtained

Paid nursing home held by leading regional medical corporation acquired (warehousing) by sponsor D. Acquisition of hospital real estate held by the medical corporation also under consideration.

Ⅴ Appendix

24

163 184

209 244

281 313

347 377

31 32

32 33

34 34

34 34

0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2%

1.3% 1.4%

1.5% 1.7%

1.9% 2.0%

2.2% 2.3%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

0

50

100

150

200

250

300

350

400

450

2008 2009 2010 2011 2012 2013 2014 2015

Room for people that need nursing careRoom for independent residentsSupply rate of room for independent residents (among population of 75 years-old or older)

Supply rate of room for people that need nursing care (among population of 75 years-old or older)

112

2,772

4,205

5,160 5,543

5,885

3,448

82,809

130,447

161,517 178,173

187,170

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2011 2012 2013 2014 Jun-15 Dec-15

Number ofrooms

（Rooms）

1. Environment Surrounding Healthcare Facilities (Facilities and Housing for the Elderly)

25

Paid nursing home/for peoplethat need nursing carePaid nursing home/forindependent residentsServiced housing for the elderly

Group home

Three types of long-term careinsurance facilities (Note)

Estimated Sales

23％

２％

７％

12％ 56％

Market Size of Facilities and Housing for the Elderly (estimated in December 2015)

6,412.3 billion yen

Paid nursing home/for peoplethat need nursing carePaid nursing home/forindependent residentsServiced housing for theelderlyGroup home

Three types of long-term care

insurance facilities (Note)

1,779 thousand rooms

Registration Status of Serviced Housing for the Elderly

21％

２％

10％

11％ 56％

Number of Rooms

Supply Status and Supply Rate of Paid Nursing Home

(thousand room)

Source: Prepared by the asset management company based on “Registration Status of Serviced Housing for the Elderly” by the Ministry of Land, Infrastructure, Transport and Tourism and KPMG’s materials.

(Note) This refers to Facilities Covered by Public Aid Providing Long-Term Care to the Elderly (intensive care homes for the elderly), Long-Term Care Health Facilities ( nursing and health facilities for the elderly) and Sanatorium Medical Facilities for the Elderly Requiring Long-Term Care.

(building)

2-1. Environment Surrounding Healthcare Facilities (Medical Service-Related Facilities)

About Regional Healthcare Vision

Medical institutions

Prefecture governm

ent

It is decided that prefectural governments must establish “Regional Healthcare Vision” for each secondary medical area by March 2018 due to the enactment of “Act for Securing Comprehensive Medical and Long-term Care in the Community” in the 2014 ordinary Diet session. • “Regional Healthcare Vision” is to estimate and stipulate medical demand and required number of beds in 2025 for each medical function in order to promote functional differentiation and

coordination of hospital beds to prepare for 2025. • Ministry of Health, Labor and Welfare established “Guideline” that stipulates estimating methods in March 2015 for prefectural governments to start formulating “Regional Healthcare Vision.”

26

(Functions of respective hospital is not clear)

Select medical function voluntarily

(Hospital Ward A) Advanced acute stage function

(Hospital Ward B) Acute stage function

(Hospital Ward C) Recovery stage function

(Hospital Ward D) Chronic stage function

Report current status and future direction of

medical functions

Establish “Regional Healthcare Vision” by utilizing reports on medical functions, etc. and promote further functional differentiation

(Content of “Regional Healthcare Vision”) 1. Medical demand and required number of hospital beds in 2025 ・Estimate for each of the four functions, which are advanced acute stage, acute stage, recovery stage and chronic stage ・Estimate for each area of the vision within prefecture (in principal, secondary medical area) 2. Measures to realize medical provision system to aim for. (Example) Preparation of facilities, securing and training of medical staff, etc. to promote differentiation and coordination of medical functions.

Differentiation and coordination of functions to be discussed and adjusted at “Regional Healthcare Vision Coordination Council”

Source: “Regional Healthcare Vision” by the Ministry of Health, Labor and Welfare

2-2. Environment Surrounding Healthcare Facilities (Medical Service-Related Facilities)

Case of Tokyo

357,569 beds

210,566 beds

One for ten

26,926 beds

One For

thirteen

54,301 beds

One For

fifteen

216,653 beds

41.3％

24.3％

3.1％

6.3％

25.0％

47,338 beds

14,793 beds

3,431 beds

3,931 beds

13,998 beds

56.7％

17.7％

4.1％

4.7％

16.8％

13.7％

19.8％

26.7％

21.4％

13,140 beds

25,549 beds

18,979 beds

20,439 beds

17,519 beds

Current picture Image of reform which national government sets for 2025

<Nationwide> <Tokyo>

Hospital’s general wards

27

Advanced acute stage 180,000 beds

General acute stage Approx. 350,000 beds

Subacute stage, etc. Approx. 260,000 beds

Long-term recuperation 280,000 beds 18.3％

One for

Seven

Hospital’s recuperation wards

*Excluding 1,301 beds under provisional measures

*Excluding 23,022 beds under provisional measures 240,000 com

munity-based hospital beds

<Nationwide> <Tokyo>

Source: “Issues in Establishing and Realizing Regional Healthcare Vision” by the Bureau of Social Welfare and Public Health, Tokyo Metropolitan Government

Property Name

AQUAMARINE Nishinomiyahama

Bonsejour Chitose-funabashi Bonsejour Hino Bonsejour

Musashi-shinjo

Medical Rehabilitation Home Bonsejour

Hadanoshibusawa

Medical Rehabilitation Home Bonsejour Komaki

Location 4-15-2, Nishinomiyahama, Nishinomiya-shi, Hyogo

1-37-3, Funabashi, Setagaya-ku, Tokyo

438-1, Ochikawa, Hino-shi, Tokyo

773-2, Chitose, Takatsu-ku, Kawasaki-shi, Kanagawa

1-6-60, Shibusawakami, Hadano-shi, Kanagawa 3-1, Shiroyama, Komaki-shi, Aichi

Nearest Station Nishinomiya Station on Hanshin Main Line

Chitose-funabashi Station on Odakyu Odawara Line Mogusaen Station on Keio Line Musashi-Shinjo Station on JR

Nambu Line Shibusawa Station on Odakyu Odawara Line

Ajioka Station on Meitetsu Komaki Line Jinryo Station on JR Chuo Main Line

Construction Completion May 2007 March 1988 May 1990 February 1985 July 1991 March 1991

Site area 2,587.93 ㎡ 1,020.92㎡ 2,211.28 ㎡ 1,233.49 ㎡ 2,588.04 ㎡ 8,229.85 ㎡

Leasable area 5,157.26 ㎡ 2,342.17 ㎡ 1,984.17 ㎡ 1,710.43 ㎡ 3,435.79 ㎡ 8,858.49 ㎡





Paid nursing home with care service Housing type paid nursing home

Structure /No. of floor

(Note1) RC,５F RC, B1F/6F RC, 3F RC, 4F RC, 5F SRC/RC/S, 10F

No. of Rooms /Resident Capacity 90 rooms, 100 people 42 rooms, 47 people 56 rooms, 58 people 46 rooms, 49 people 100 rooms, 101 people 123 rooms, 166 people

Operator GREEN LIFE Benesse style Care Benesse style Care Benesse style Care Benesse style Care Benesse style Care Remaining years of

lease agreement (Note 2)

21 years 10 years 10 years 10 years 11 years 11 years

Appraisal NOI (Note 2) 121 million yen 49 million yen 43 million yen 36 million yen 47 million yen 92 million yen

Cap Rate (Note 2) 5.4％ 4.5％ 4.9％ 5.2％ 5.1％ 5.6％

Appraisal Value (Note 2) 2,160 million yen 958 million yen 806 million yen 633 million yen 838 million yen 1,430 million yen

Acquisition Price 1,950 million yen 824 million yen 724 million yen 582 mullion yen 728 million yen 1,270 million yen

3-1. Detailed Portfolio List

28 (Note 1) As for abbreviation used in Structure column, SRC refers to steel-reinforced concrete, RC refers to reinforced concrete and S refers to steel structure. (Note 2) Figures in Remaining years of lease agreement, Appraisal NOI, Cap Rate and Appraisal Value are as of July 31, 2016.

Property Name ASHEIM Hikarigaoka ASHEIM Bunkyohakusan Sompo CARE La vie Re

Machidaonoji Sompo Care La vie Re

Azamino SAWAYAKA

Tachibanakan SAWAYAKA Mekarikan

Location 4-3-23, Yahara, Nerima-ku, Tokyo 4-36-13, Hakusan, Bunkyo-ku, Tokyo

1612, Onojimachi, Machida-shi, Tokyo

19-24, Ayumigaoka, Tsuzuki-ku, Yokohama-shi, Kanagawa

173-15, Oaza Ryugeji, Hakata-ku, Fukuoka-shi, Fukuoka

1-9-15, Okubo, Moji-ku, Kitakyushu-shi, Fukuoka

Nearest Station Shakujii-koen Station on Seibu Ikebukuro Line

Hakusan Station on Toei Subway Mita Line

Keio Nagayama Station on Keio Sagamihara Line Odakyu Nagayama Station on Odakyu Tama Line

Nakagawa Station on Yokohama Municipal Subway Blue Line

Sasahara Station on JR Kagoshima Honsen Line

Mojiko Station on JR Kagoshima Honsen Line

Construction Completion March 2006 February 2007 October 2007 March 2004 October 2005 November 2005

Site area 2,868.46 ㎡ 540.29 ㎡ 7,404.13 ㎡ 2,748.64 ㎡ 3,359.66 ㎡ 3,758.26 ㎡

Leasable area 3,628.60 ㎡ 2,494.78 ㎡ 7,720.17 ㎡ 5,789.25 ㎡ 5,652.94 ㎡ 4,720.46 ㎡







Structure /No. of floor

(Note1) RC, 3F RC, ８F RC, B1F/6F RC, BC1F/5F RC, BC１F/６F RC, ４F

No. of Rooms /Resident Capacity 83 rooms, 89 people 50 rooms, 52people 163 rooms, 169 people 145 rooms, 145 people 104 rooms, 104 people 95 rooms, 95 people

Operator AS PARTNERS AS PARTNERS Sompo Care Next Sompo Care Next Sawayaka Club Sawayaka Club

Remaining years of lease agreement

(Note 2) 18 years 11years 11years 11years 12 years 12 years


Cap Rate (Note 2) 4.9% 4.5% 5.0% 4.7% 5.6% 5.7%

Appraisal Value (Note 2) 1,540 million yen 1,590 million yen 3,750 million yen 3,210 million yen 1,580 million yen 1,460 million yen

Acquisition Price 1,385 million yen 1,430 million yen 3,580 million yen 3,050 million yen 1,520 million yen 1,380 million yen



Property Name

SAWAYAKA Tagawakan

GOOD TIME HOME Fudo-mae

Sompo no ie S Awajiekimae

Sompo no ie S Kobekamisawa Bonsejour Yotsugi Medical home

Bonsejour Itami

Location 393-1, Oaza Ita, Tagawa-shi, Fukuoka

5-25-13, Nishigotanda, Shinagawa-ku, Tokyo

3-20-26, Awaji, Higashiyodogawa-ku, Osaka-shi,

Osaka

8-2-5, Kamisawadori, Hyogo-ku, Kobe-shi, Hyogo

3-1-11, Higashiyotsugi, Katsushika-ku, Tokyo 1-2-25, Chuo, Itami shi, Hyogo

Nearest Station Tagawa Ita Station on JR Hita Hikosan Line

Fudo-mae Station on Tokyu Meguro Line

Awaji Station on Hankyu Railway Kyoto Line

Kamisawa Station on Kobe Municipal Subway Seishin-Yamate Line

Yotsugi Station on Keisei Railway Oshiage Line

Itami Station on Hankyu Railway Itami Line

Construction Completion January 2006 March 1992 June 2009 June 2009 March 1989 March 1989

Site area 4,300.90 ㎡ 1,206.60 ㎡ 1,251.26 ㎡ 743.22 ㎡ 1,136.46㎡ 1,976.11㎡

Leasable area 2,366.20 ㎡ 3,400.20 ㎡ 5,658.53 ㎡ 3,626.25 ㎡ 1,962.89㎡ 2,129.87㎡


Paid nursing home with care service Serviced housing for the elderly Serviced housing for the elderly Paid nursing home

with care service Housing type paid nursing

home Structure

/No. of floor (Note1)

RC, ３F RC, BC１F/５F RC, 12F S, ９F RC, ５F SRC, 11F

No. of Rooms /Resident Capacity 60 rooms, 60 people 61 rooms, 67 people 137 rooms, 137 people 85 rooms, 85 people 61 rooms, 65 people 62 rooms, 64 people

Operator Sawayaka Club JAPAN LIFE DESIGN Sompo Care Message Sompo Care Message Benesse Style Care Benesse Style Care

Remaining years of lease agreement

(Note 2) 12years 10 years 18 years 18 years ９ years 11 years


Cap Rate (Note 2) 5.8% 4.5% 5.3% 5.3% 4.8% 5.2%

Appraisal Value (Note 2) 410 million yen 1,910 million yen 2,130 million yen 1,320 million yen 872 million yen 550 million yen

Acquisition Price 390 million yen 1,740 million yen 1,930 million yen 1,200 million yen 824 million yen 514 million yen



4-1. Overview of Operators

GREEN LIFE Co., Ltd Headquarters location 3-20-8, Kasuga, Suita-shi, Osaka

Representative Representative Director and President Keiji Arai

Founded May 1994

Capital stock 50 million yen

Listed or unlisted Unlisted

Parent company SHIP HEALTHCARE HOLDINGS, INC (TSE 1st Section, Code No. 3360)

Benesse Style Care Co., Ltd. Headquarters location

Shinjuku Monolith Building 5th floor, 2-3-1, Nishi-Shinjuku, Shinjuku-ku, Tokyo

Representative Representative Director and President Shinya Takiyama

Founded September 1995



Parent company Benesse Holdings, Inc. (TSE 1st Section, Code No. 9783)

AS PARTNERS Co., Ltd. Headquarters location Toho Twin Bldg. 6F, 1-5-2, yurakucho, Chiyoda-ku, Tokyo

Representative Representative Director and President Takeshi Uemura

Founded November 2004



JAPAN LIFE DESIGN Inc. Headquarters location

Akasaka Enoki-zaka Mori Building 6th floor, 1-7-1, Akasaka, Minato-ku, Tokyo

Representative Representative Director and President Shoetsu Ito Founded April 2004 Capital stock 100 million yen Listed or unlisted Unlisted Headquarters location SOUSEI JIGYODAN CO., Ltd.

31

GREEN LIFE Co., Ltd. considers its nursing homes “an extension of the family,” and where residents can enjoy a peaceful, safe, and comfortable lifestyle. As a company engaged in long-term care business under SHIP HEALTHCARE HOLDINGS, INC. and group of companies including GREEN LIFE HIGASHI NIHON Inc., GREEN LIFE Co., Ltd. operates facilities nationwide.

Benesse Style Care Co., Ltd. operates seven brands in Tokyo, Osaka, Nagoya, and elsewhere in Japan. The brands are mainly mid- to high-end, such as Bonsejour and GRANDA, thus allowing residents to select “a lifestyle that suits them.”

AS PARTNERS Co., Ltd. operates paid nursing homes and day service facilities under the ASHEIM brand in the Greater Tokyo Area, based on the philosophy of “a rich life in your own way, with your own strength until the end.”

JAPAN LIFEDESIGN Inc. operates paid nursing homes under the GOOD TIME HOME brand in Tokyo. Including the facilities of the parent company SOUSEI JIGYOUDAN CO., Ltd. and its subsidiaries, JAPAN LIFEDESIGN Inc. operates 31 facilities (resident capacity of 2,305 people).

4-2. Overview of Operators

Sompo Care Next Inc. Headquarters location

Shinagawa Seaside east tower 12th floor, 4-12-8, Higashishinagawa, Sinagawa-ku, Tokyo

Representative President and Chief Executive Officer Ken Endo


Capital stock 5,095 million yen


Parent company Sompo Holdings, Inc. (TSE 1st Section, Code No. 8630)

SAWAYAKA Club., Ltd. Headquarters location 2-10-10, Kumamoto, Kokurakita-ku, Kitakyushu-shi, Fukuoka

Representative Representative Director and President Bunji Uchiyama

Founded December 2004

Capital stock 200.8 million yen


Parent company UCHIYAMA HOLDINGS Co., Ltd. (TSE 1st Section, Code No. 6059)

Sompo Care Message Inc. Headquarters location 522-1, Nishiichi, Minami-ku, Okayama-shi, Okayama

Representative President and Chief Executive Officer Tetsuya Kikui

Founded May 1997

Capital stock 3,925 million yen

Listed or unlisted Listed on TSE JASDAQ (Code No. 2400)

Parent company Sompo Holdings, Inc. (TSE 1st Section, Code No. 8630)

32

Sompo Care Next Inc. mainly operates paid nursing homes with service under the Sompo Care La vie Re brand and other brands, mainly in the Greater Tokyo Area, under the concept that “homes exist solely for the happiness of their residents.

Sawayaka Club Co., Ltd. operates low-price facilities with no upfront entrance fees under the SAWAYAKA brand, in Fukuoka Prefecture and elsewhere in Japan, based on the belief in repaying older generations that gave their all for the development of Japan.

Sompo Care Message Inc. aims to offer an environment where the elderly can continue living in the area they are used to, even once they require nursing care. Sompo Care Message Inc. operates mid- to low-end facilities under the Sompo no ie and Sompo no ie S brands mainly in Tokyo, Osaka, Nagoya, and also elsewhere in Japan.

http://www.sompocare-next.jp/

Individuals, etc.

97%

Financial institutions

１%

Domestic

companies

２%

Foreign companies /individuals

０%

Name Number of

investment units owned(units)

Ownership ratio (%) (Note)

Japan Trustee Services Bank Ltd. (Trust Account) 10,532 8.74 Trust & Custody Services Bank Ltd. (Securities Investment Trust Account) 7,002 5.81

NEC Capital Solutions Limited 4,000 3.31

SHIP HEALTHCARE HOLDINGS INC. 4,000 3.31

Sumitomo Mitsui Banking Corporation 4,000 3.31 The Master Trust Bank of Japan, Ltd. (Trust Account) 3,786 3.14 The Nomura Trust and Banking Co., Ltd. (Investment Trust Account) 3,083 2.55

Meiji Yasuda Life Insurance 1,322 1.09 STATE STREET BANK AND TRUST COMPANY 505001 1,050 0.87

Numazu Shinkin Bank 1,000 0.82

Yonezawa Shinkin Bank 1,000 0.82

Total 40,775 33.83

5. Status of Unitholders

Individuals, etc. 49%

Financial institutions

36%

Domestic Companies

12%

Foreign companies /individuals

３%

By number of Owned Units

By Number of Unitholders List of Top Unitholders (as of the end of July 2016)

33 (Note) Ownership ratio is rounded down to the second decimal place.

6. Overview of Unitholder Special Benefit Plan

Details of Special Benefits

・Free trial move-in (two-day and one-night with meals) ・Tour with free lunch

Sompo Care Next inc.内

GREEN LIFE Co., Ltd.


・Discount advance payment or monthly fee ・Tour with free lunch


・Free trial move-in (two-day and one-night with meals) ・Discount upfront entrance fees

JAPAN LIFE DESIGN Inc.

・Discount upfront entrance fees ・Discount monthly fee (discount management fees) ・Free trial move-in (four-day and three-night) ・Tour with free lunch

AS PARTNERS co., Ltd.


Sawayaka Club Co., Ltd.


・Free consultation on nursing care

Benesse Senior Support Co., Ltd

(Note) Details of special benefits are for people who are unitholders as of the end of 3rd fiscal period and are subject to change.

34

・Discount monthly fee for initial month ・Free trial move-in (two-day and one-night with meals) ・Tour with free lunch


http://www.sompocare-next.jp/

0

200

400

600

800

1,000

1,200

1,400

1,600

90,000

95,000

100,000

105,000

110,000

115,000

2/1/16 3/1/16 4/1/16 5/1/16 6/1/16 7/1/16

Trade volume of HCM HCM TSE REIT Index

Unit Price, TSE REIT Index and Trade Volume

（Yen）（Unit）

(figure relative to HCM’s unit price)

7. Information related to Investment Units

35

Accounting Auditor

PricewaterhouseCoopers Aarata LLC

Asset Management

・Provide professional know-how ・Provide human resources ・Provide property information, etc.

Sponsor

Sponsor Support Agreement

SMBC Trust Bank RISA Partners Orion, etc.

Pipeline Support Agreement

8. HCM’s Network

Asset Custody Company Administrative Agent Administrator of the Investors’ Registry

Sumitomo Mitsui Trust Bank

36

Asset Management Company

Sumitomo Mitsui Finance and Leasing SMBC Friend Securities Ginsen

Muromachi Building Yoei Kobe Tochi Tatemono

Trade name Healthcare Asset Management Co., Ltd.

Location 3-3 Kanda-Ogawamachi, Chiyoda-ku, Tokyo

Founded November 28, 2013


President and Representative Seiji Yoshioka

Major shareholders

SHIP HEALTHCARE HOLDINGS, INC. (33.3%) NEC Capital Solutions Limited (33.3%) Sumitomo Mitsui Banking Corporation (5.0%) Sumitomo Mitsui Finance and Leasing Company, Limited (4.8%) SMBC Friend Securities Co., Ltd. (4.8%)

Registration, license, etc.

Registered as a financial service provider (Director of Kanto Local Finance Bureau (Kinsho) No. 2815)

License as a building lots and buildings business operator (Governor of Tokyo (1) No. 96339)

License as an entrusted agency services for transactions (Minister of Land, Infrastructure, Transport and Tourism No. 85)

General Meeting of Shareholders

Board of Directors

Representative Director

Asset Management Department Investment Department Financial & Administration Department

Audit & Supervisory Board Member

Management Committee Compliance Committee

9. Profile of Asset Management Company

37

Internal Audit Office Compliance Office

With a stated mission to “create an environment of people protecting life,” SHIP HEALTHCARE HOLDINGS, INC. carries out a wide-range of nursing care and medical service-related businesses in four domains on a group basis: the Lifecare Business, in which it operates paid nursing homes; the Total Pack Produce Business, in which it offers comprehensive, optimal solution services to meet the needs for hospital launch/relocation and building extension/renovation of medical institutions; the Medical Supplies Business, in which it sells medical supplies and other products; as well as the Dispensing Pharmacy Business.

Sumitomo Mitsui Banking Headquarters location 1-1-2 Marunouchi, Chiyoda-ku, Tokyo

Representative President Takeshi Kunibe

Capital stock 1,770.9 billion yen

NEC Capital Solutions Headquarters location 2-15-3 Konan, Minato-ku, Tokyo

Representative President Masahiro Annaka


Capital stock 3,776.88 million yen

Sales 202.6 billion yen when consolidated (fiscal period ended March 2016)

SHIP HEALTHCARE HOLDINGS, INC. Headquarters location 3-20-8 Kasuga, Suita-shi, Osaka

Representative Chairman and CEO Kunihisa Furukawa President and COO Hirotaka Ogawa

Founded August 1992

Capital stock 15,553.01 million yen

Sales 306.8 billion yen when consolidated (fiscal period ended March 2016)

As NEC Group’s comprehensive financial services company, in addition to its mainstay leasing business and ICT-related service business, NEC Capital Solutions Limited is engaged in investments, loans, and advisory services in the business domains of “companies,” “credits,” and “assets,” through RISA Partners, Inc., its subsidiary which has a track record in the fund business, etc.

As the core company of the Sumitomo Mitsui Financial Group, it possesses one of the strongest sales foundations in Japan, has an ability to execute strategies quickly, and is capable of providing financial services through its influential group companies.

10. Profile of Major Sponsors

38

Disclaimer This presentation material contains forward-looking statements including forecasts, outlooks, goals and plans. These statements are based on the information available as of the date when this material is prepared and incorporate certain subjective assumptions about uncertain factors that may affect future results. Accordingly, these statements are inherently not guarantees of future performance and actual results may differ materially. The opinions, outlooks and estimates contained in this material reflect our view and judgment based on information as of the date when this material is prepared and involve risks and uncertainties. No guarantee is made as to the accuracy, completeness, appropriateness and validity of information contained in this material. It is not promised that information contained in this material will always be updated. Contents of this material are subject to change without notice. This material is not intended as a solicitation for investment. Any investment decision must be made based on your own judgment and responsibility.

39

fiscal period ended july 2016 (3rd fiscal period)...

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