Policy 1: Establishing and Announcing Policies That Include Those Regarding Customer-Oriented Business Conduct

Fukuoka Realty Co., Ltd., is a financial business operator managing a listed REIT, which, through investing in real estate properties, supports and facilitates the asset formation of a wide range of investors. As such, we have established clear policies to implement customer-oriented business conduct throughout the investment chain and have publicized those on our website and via other methods. Moreover, we continuously check on the status of our endeavors to realize better customer-oriented business operations.

Policy 2: Pursuit of Customers’ Best Interests

As a financial business operator, we maintain a high level of professionalism and professional ethics, conduct operations with integrity and fairness for unitholders, secure stable dividends, increase dividends over the medium to long term and conduct investment that can contribute to society, among other endeavors, to achieve unitholders’ best interests. We also strive to ensure that such business conduct will be deeply rooted in our corporate culture. As an asset management company knowledgeable about the circumstances of the region , we will make efforts that leverage our expertise and ability to gather and provide information to achieve the best interests of our unitholders.

Policy 3: Appropriate Management of Transactions with Conflicts of Interest

1. (1)We place the highest priority on the fiduciary duty entrusted to us by our unitholders. For transactions with our interested parties, including Fukuoka Jisho Co., Ltd., one of our sponsors having 55% equity, which might cause conflicts of interest, we work to accurately grasp the possibility of conflicts of interest with any of our unitholders pursuant to laws and regulations, our internal rules, etc. If any such possibility is found, our Compliance Department investigates the matter in advance before the relevant transaction takes place, and deliberation is made in advance at the Investment Committee and the Compliance Assessment Committee, which invites outside experts if necessary. Through these steps, we appropriately manage transactions that might have conflicts of interest. Specifically, when acquiring real estate from any interested party, for example, we follow the processes established in our in-house rules for determining whether a certain deal is a transaction with a conflict of interest as stipulated in our Asset Management Guidelines. By doing so, we prevent any disadvantage to unitholders from arising. When acquiring real estate from any interested party, we conduct an investigation and give full consideration, for instance, conducting the transaction at a price equal to or less than the appraisal value provided by a third party, before deciding on the investment.
2. (2)As we do not sell financial products and do not have a corporate sales or management department within our company or the Group, there is no possibility of a conflict of interest when soliciting sales or recommending financial instruments or when choosing an investment destination for assets.

Policy 4: Clarification of Fees and Commissions

1. (1)Entrusted by the Investment Corporation to carry out all operations related to asset management, Fukuoka Realty Co., Ltd., in return receives asset management fees from the Investment Corporation. We have adopted an asset management fee system that enables asset management from a long-term perspective while linking part of the asset management fee amount to the profitable returns to unitholders.
2. (2)We provide information through statutory and timely disclosure and voluntary disclosure so that unitholders can understand our asset management fees and other commissions or expenses to be borne by the Investment Corporation, including what types of services are paid for.

Policy 5: Provision of Important Information in an Easy-to-Understand Manner

1. (1)As an asset management company of a listed REIT, we provide important information that relates to investment decision-making for unitholders in an easy-to-understand manner through statutory and timely disclosure as well as voluntary disclosure so that such information can be readily understood. We also post such information on our website in a timely manner to provide information desirable for unitholders from a unitholder-oriented perspective.
2. (2)Not soliciting the sale or recommendation, etc., of financial instruments or financial services, we do not provide important information related to these to our unitholders.

Policy 6: Provision of Services Suitable for Unitholders

1. (1)We strive to understand the needs and requirements of unitholders and conduct asset management considering such needs and requirements. Specifically, we aim to secure stable dividends, increase dividends over the medium to long term, and conduct investment that can contribute to society, among other endeavors.
2. (2)We do not solicit the sale or recommendation, etc., of financial instruments or financial services.