marimo Regional Revitalization REIT, Inc.

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marimo Regional Revitalization REIT, Inc.
Executive Director
Takashi Kitagata

Dear Unitholders,

We hope this message finds you well. We would like to express our sincere gratitude for your continued support.

marimo Regional Revitalization REIT, Inc. (hereinafter, “marimo REIT”) was listed on the Tokyo Stock Exchange Real Estate Investment Trust Market as a diversified REIT with a portfolio of residential, retail, hotel and office properties (hereinafter, “diversified mix of income-producing real estate”) on July 29, 2016. Recently, marimo REIT successfully ended the 6th fiscal period (ended June 2019). This again was thanks to the support of our unitholders for which we are deeply grateful.

marimo REIT, which aims to establish a structure serving to create regional societies where people nationwide can live their unique lifestyles pleasantly while being hopeful for their region’s future and enabling anyone to take part in regional revitalization and enjoy the fruits of such revitalization through marimo REIT, commenced management with the acquisition of a diversified mix of income-producing real estate totaling 17 properties amounting to 16,170 million yen on August 1, 2016.

In the 6th fiscal period, marimo REIT acquired ArtizA Higashi-Shimada (acquisition price: 700 million yen), developed by Marimo Co., Ltd., the sponsor, on January 4, 2019, expanding its asset size to 25,225 million yen (26 properties). For existing properties, marimo REIT made efforts to reduce maintenance costs and enhance NOI, such as switching electric power distributors, raising rent upon tenant replacement and reducing costs by switching to LED lighting in common areas. As a result, marimo REIT managed to post operating revenue of 1,121 million yen, operating income of 471 million yen, ordinary income of 397 million yen and net income of 396 million yen for dividends per unit (including dividends in excess of earnings) of 3,494 yen.

At the beginning of the 7th fiscal period (ending December 2019), marimo REIT borrowed 4,030 million yen of funds on August 1, 2019, from a loan syndicate that included Aozora Bank, Ltd., a new lender, in order to repay long-term borrowings of 3,330 million yen and short-term borrowings of 700 million yen.

Setting “strengthen Japan from regional areas” as a basic principle, marimo REIT will continue to strive to build a diversified portfolio, centering on regional areas, oriented toward securing both “relatively high investment yield” and “stable earnings” and steady growth of assets under management and thereby enhance unitholder value over the medium to long term.

We look forward to your continued support and encouragement.

September 2019