Investment Policies - Basic Policies

On investment in real estate assets, United Urban Investment Corporation ("United Urban" or the "Investment Corporation") endeavors to secure steady earnings over the medium to long term. To this end, United Urban is going to establish and develop an optimal investment portfolio of real estate assets both in use and location in tune with economic conditions and real estate market trends. Also United Urban makes every effort to minimize risks. United Urban would like to build up a comprehensive investment portfolio by investing in real estate assets in various types of use and in various areas of locations as described below.

Furthermore, upon acquisition of real estate properties, United Urban will conduct adequate due diligence (such as detailed investigations, hereinafter, "DD"), carefully examine not only profitability but also impact including those listed below and assess the value of the relevant investment before making investment decisions in compliance with the investment environment, etc. If problems are found in the DD process, such properties will not be acquired, no matter how profitable.

Environment (e.g. asbestos, soil contamination)
Tenants (e.g. antisocial forces, labor environment)
Surrounding area (e.g. relationship with the relevant community, influence of traffic congestion on surrounding environment, etc.)

Type of Use of Real Estate Assets

United Urban shall invest primarily in real estates such as retail properties, office buildings, hotels, residential properties and others.

Retail Properties

Office Buildings

Hotels

Residential Properties

Others

Revenues obtained from real estate investment and management concentrated on specific property types may be impacted largely when the markets of the property types become stagnant. Accordingly, United Urban aims to secure steady earnings and reduce risks inherent to real estate market conditions of specific types of use by diversification of investment in property types. In addition, our investments in properties of a particular type of use is limited to a maximum of 60% of the total investment portfolio based on the latest real estate appraisal value (Note).

(Note)	In order to generate stable earnings, however, Untied Urban may temporarily maintain an investment portfolio comprised of properties of a particular type of use in excess of 60% of the total investment portfolio.

⇒For details please refer to "Type of Use" page.

Area of Location

United Urban shall invest in real estates located in the Tokyo Metropolitan Area and other major cities in Japan including government designated cities, and surrounding areas thereof.

Area of Location

Revenues obtained from real estate investment and management concentrated on specific regions may be impacted largely by earthquakes and other natural disasters as well as local economic conditions. Accordingly, United Urban invests in diversified regions in order to secure steady earnings and reduce the risks of natural disasters and other such events in specific regions. In addition, our investment in real estate located in the Tokyo Metropolitan Area ^{(Note 1)} will be more than 50% of its total investment portfolio based on the latest real estate appraisal value. As for investments in other major cities in Japan including government designated cities and surrounding areas thereof other than the Tokyo Metropolitan Area, however, United Urban will generally limit our real estate investment in any single regional economic zone ^{(Note 2)} to a maximum of one-third of the total investment portfolio ^{(Note 3)}.

(Note 1)	"Tokyo Metropolitan Area" refers to Tokyo excluding the 23 wards of Tokyo, as well as Kanagawa, Chiba, Saitama, Ibaraki, Gunma, Tochigi and Yamanashi prefectures.
(Note 2)	A "regional economic zone" indicates an economic zone comprising a single major city (or plural major cities) and surrounding cities, where the economic conditions and the real estate market trends of the major city (or cities) having a strong impact on the entire zone.
(Note 3)	United Urban may temporarily exceed the ratio stated above in the event of acquisition of portfolio assets that will serve to secure steady earnings and are also essential to structuring the portfolio.

⇒For details please refer to "Investment Area" page.

Advantages of the Portfolio the Asset Management Company Aims to Build

The asset management company of United Urban, Marubeni REIT Advisors Co., Ltd. (“MRA”) believes that the portfolio structure we aim to build has the following advantages.

Stability of Earnings	Growth Potential
The impact from changes in the market environment for specific property types and regions can be flattened. The relatively stable earnings over the medium to long term can be realized in avoidance of the excessive concentration. In addition, we believe that a certain level of diversification in the location areas makes it possible to reduce risks related to natural disasters and other events.	Investing in real estate on various property types or geographical location areas can lead to plenty of opportunities to acquire profitable properties. As such, we are able to purchase real estate optimal for our portfolio by analyzing and screening of individual candidate properties.

Capabilities of an Asset Management Company for Building up an Optimal Portfolio

The management and senior staffs of MRA comprise the following:

Personnel from the Marubeni Group with extensive expertise in the field of real estate, including its development, acquisition, management and sale
Personnel with comprehensive investment experience gained in financial institutions

United Urban is confident that, it is able to build up an optimal investment portfolio with these experts who are engaged in asset management activities as core members.

MRA's own rules

50% Rule	United Urban's investment policy of maintaining the ratio (appraisal base) of investment in properties in the Tokyo Metropolitan Area more than 50% of its entire portfolio
60% Rule	United Urban's investment policy of maintaining the ratio (appraisal base) of investment in properties in each type of use less than 60% of its entire portfolio
1/3 Rule	United Urban's investment policy of maintaining the ratio (appraisal base) of any single regional economic zone except Tokyo Metropolitan area less than 1/3 of its entire portfolio (excluding the Tokyo Metropolitan Area)