To Our Unitholders

We would like to take this opportunity to express our sincere gratitude to all unitholders of Invincible Investment Corporation ("INV") for your continued support. We hereby provide you with a report on INV's asset management and financial results for the 43rd fiscal period (from July 1, 2024 to December 31, 2024) (the "Reporting Period").

In the Reporting Period, the domestic hotels achieved steady growth compared to the previous year due to stable domestic demand coupled with the recovery and growth in inbound demand. As for the Cayman hotels, there was a temporary downturn in performance due to the partial sales stoppage resulting from the large-scale renovation work at Sunshine Suites Resort, but demand remained strong.

Under such circumstances, INV implemented a global public offering for the second consecutive year to acquire 12 domestic hotels, including the full-service hotel "Art Hotel Osaka Bay Tower & Solaniwa Onsen", further expanding and enriching its hotel portfolio, which is the largest among J-REITs. Furthermore, in October 2024, Fusaki Beach Resort Hotel & Villas, one of INV's flagship hotels, won a total of six awards for "World Luxury Hotel Awards 2024", an internationally recognized award which is considered as the "Academy Awards of the hotel industry", including three "World Luxury Hotel Awards" in the hotel category, and three awards for "World Luxury Spa Awards 2024" for its SPA "Fusaki Spa". We believe that the hotel's high quality of service and diverse facilities were highly evaluated, leading to the award, and we look forward to welcoming our unitholders to this hotel.

On the financing side, we worked to manage our finances by keeping a close eye on interest rate trends, and we extended the terms of the loans and diversified repayment dates. At the same time, we raised the ratio of fixed interest rates by implementing interest rate swap transactions and borrowing at fixed interest rates as a precaution against the risk of rising interest rates.

As a result, INV announced a distribution per unit of JPY 1,982 by recording operating revenues of JPY 25,555 million, operating income of JPY 17,751 million, and net income of JPY 15,138 million in the Reporting Period. The distribution per unit ("DPU") exceeded the result for the June 2024 fiscal period and is the highest DPU since February 2010 when the corporate name changed to Invincible Investment Corporation.

The current environment will continue to require us to deal with rising costs, including interest rates, but we aim to further increase DPU by working diligently to capture demand for banquets and meetings which have recovered significantly after the COVID-19 pandemic, and inbound demand in regional areas, as well as by making asset acquisitions and strategic investments such as renovations of domestic and overseas hotels.

Your continued support is highly appreciated.