To Our Unitholders

Shuichi Namba  President and Executive Director, Japan Retail Fund Investment Corporation

I would like to take this opportunity to express my sincere gratitude to all investors for their ongoing support of Japan Retail Fund Investment Corporation (JRF).

In terms of domestic macroeconomic trends during the six months ended August 31, 2019 (35th fiscal period), although stagnation was seen in exports and capital investment by private companies due to factors such as U.S.-China trade friction, there was a steady increase in leisure-related household consumption during the extended holiday period following the change of the era name. As
a result, Gross Domestic Product (GDP) recorded growth in two consecutive quarters: the January to March 2019 quarter and April to June 2019 quarter. The J-REIT market was firm, underpinned by
inflows of investment funds on the strength of its defensive nature and steady returns. Consequently, the TSE REIT Index surpassed 2,090 points at the end of August for the first time since August 2007.

Under the market environment described above, JRF acquired two new properties (m-city Kashiwa and G-Bldg. Jingumae 09) and sold four properties (8953 Osaka Shinsaibashi Building, AEON Sendai
Nakayama, Narupark and Ito-Yokado Nishikicho (15% quasi-co-ownership of trust beneficiary interest)) as a part of portfolio asset replacement measures. Furthermore, as one aspect of measures to improve the value of existing properties, JRF is carrying out a large-scale renovation of KAWASAKI Le FRONT. Good progress is being made on the renovation, and the Property is being reopened in
stages starting in April 2019 prior to the scheduled opening of an aquarium in the August 2020 fiscal period. As a result, during this fiscal period, operating revenue increased by 15.5% compared to the previous fiscal period to 35,432 million yen and net income increased by 15.4% to 12,814 million yen. Total distributions for the six months ended August 31, 2019 amounted to 11,597 million yen by adding 31 million yen in reversal of reserves for temporary difference adjustments and by deducting reserve for dividends amounting to 1,248 million yen from unappropriated retained earnings at the end of the period. As a result, distributions per unit were 4,430 yen, the same as in the previous period.

JRF seeks to continuously increase unitholder value by pursuing higher quality and profitability through replacement of Sub assets with Core assets in accordance with our medium-term strategy and as well as internal growth underpinned by retail management abilities.

We will continue to strive to live up to investors’ expectations, together with the asset manager, Mitsubishi Corp.-UBS Realty Inc., and look forward to receiving your continued support.

Shuichi Namba
Executive Director, Japan Retail Fund Investment Corporation