Distribution Policy

Distribution of Profits

  • Distributable amounts generated from management of INV's assets (hereinafter "distributable amounts") refers to the amount of profits calculated in conformity with the provisions of the Law Concerning Investment Trusts and Investment Corporations (hereinafter "the Law") or generally accepted accounting principles in Japan.
  • INV determines the amount of distribution, which must be an amount that exceeds 90% of the amount of INV's distributable income as stipulated in Article 67, Item 15 of the Act on Special Measures Concerning Taxation in principle (hereinafter "distributable income") (or the relevant amount after modification if there is any modification to the calculation of the said amount due to revisions to the law, etc.) (However, the amount may not exceed the distributable amount.). If, however, a deficiency account for tax purposes arises or income for tax purposes does not arise due to the carried-over deduction of a deficiency account, INV shall determine the amount of distribution on a rational basis.
  • In addition, INV may accumulate reserves and allowances from the distributable income amount which are deemed to be necessary for maintaining its investment assets and improving or increasing the value of assets such as long-term reserve for maintenance, payment reserve, reserve for distribution, and other similar reserves.
  • Any retained earnings not allocated for dividends will be managed based on INV's investment asset targets and policies.

Cash Distribution Exceeding Profits

In addition to distribution of profits, INV may make distribution in excess of profits (hereinafter the "Excess Profit Distribution") to be determined each fiscal period, not on a continuing basis, in accordance with the following basic policy.

Terms of considering to make the Excess Profit Distribution INV will consider making the Excess Profit Distribution in the event of a. or b. below, and, will, in principle, not make the Excess Profit Distribution in other circumstances.
  1. If INV determines it to be appropriate by taking into account trends in the economic environment, the real estate market, the leasing market, the real estate investment trust market and other markets or the impact that INV's asset acquisition and financing activities may have on the amount of distribution per unit.
  2. If INV can avoid the imposition of certain taxes such as corporate taxes.
Amount of Excess Profit Distribution The amount of Cash Distribution Exceeding Profit will be determined within the limit of the amount equivalent to 60% of the amount calculated by deducting the total accumulated depreciation amount recorded as of the end of the previous fiscal period from the total accumulated depreciation amount calculated as of the end of the relevant fiscal period for which such distribution is to be made.
Matters of considering to implementation of the Excess Profit Distribution and determination of the Excess Profit Distribution amount
  1. Securing funds necessary to maintain the value of INV's investment assets.
  2. The LTV level (Note) is to not exceed 60% following the Excess Profit Distribution.
  3. Securing liquidity following the Excess Profit Distribution.

(Note) LTV level (%) = a / b x 100%
a = total outstanding balance of interest-bearing debt at fiscal end
b = total assets at fiscal end - expected distribution amount

Methods of Distribution

Distributions shall be paid in cash and based on the number of investment units held by unitholders who are listed or recorded in the registry of unitholders on the closing date of each fiscal period, or to registered pledgees of the investment units.

Statutory Limitation for Dividends

INV will be exempted from its obligation to pay distributions to unitholders or registered pledgees of investment units if three full years have elapsed from the commencement date of such distribution payment. No interest will accrue with respect to unpaid distributions.


In addition to above, INV shall comply with the rules of The Investment Trusts Association, Japan, in cash distributions.