Kenedix Retail REIT : Notice Concerning Acquisition of Properties (Kitera Plaza Aobadai, Tenri Distribution Center)

Translation of Japanese Original

February 24, 2022

To All Concerned Parties

REIT Issuer:

Kenedix Retail REIT Corporation

Representative: Moyuru Watanabe, Executive Director

(Securities Code: 3453)

As se t M an ag e r:

Kenedix Real Estate Fund Management, Inc.

Representative: Masahiko Tajima, President & CEO

Contact:Koichiro Nobata, Head of Strategic Planning,

Retail REIT Department

TEL:[phone]

Notice Concerning Acquisition of Properties

(Kitera Plaza Aobadai, Tenri Distribution Center)

Kenedix Retail REIT Corporation ("KRR") announced today that Kenedix Real Estate Fund Management, Inc. ("the Asset Manager"), the asset manager for KRR, has decided to acquire the following properties. In addition, the Asset

Manager has decided to convert Kitera Plaza Aobadai ("the Conversion") after the acquisition.

1. Outline of the acquisition

Property				Anticipated acquisition	Appraisal NOI
type		Property name	Location	price (million yen)	yield (%)	Brokerage
(Note 1)				(Note 2)	(Note 3)
NSC		Kitera Plaza Aobadai	Aoba-ku, Yokohama,	2,553	4.7	Y
	(Note 4)	Kanagawa
L		Tenri Distribution Center	Tenri, Nara	1,070	5.5	Y
	Total acquisition price / Average NOI yield (%)	3,623	4.9	-
(1)	Contract date:	February 24, 2022
(2)	Acquisition date:	March 1, 2022
(3)	Seller:	Please refer to Item 4. Seller's profile for details
(4)	Acquisition funds:	Cash on hand
(5)	Settlement method:	Payment in full at settlement

Notes:

1. Properties are categorized into the following six types of properties: NSC (Neighborhood Shopping Center), SM (Supermarket), CSC (Community Shopping Center), Urban Station-Front SC (Urban Station-Front Shopping Center), SS (Specialty Store) and L (Logistics facility).
2. Excluding acquisition costs, adjustment amount of property tax and city-planning tax, consumption tax, etc. Anticipated acquisition price for Kitera Plaza Aobadai is 2,553,500,000 yen, but the figures are rounded down to the nearest unit. Assumed cost of the Conversion as of today for Kitera Plaza Aobadai is 880,000,000 yen.
3. "Appraisal NOI yield" is calculated by dividing the appraisal NOI of the anticipated property as on the appraisal report as of February 1, 2022 by the acquisition price for the property and rounded to the first decimal place.

"Appraisal NOI" refers to the net operating income before depreciation expenses, which is calculated by deducting the operating expenses from the operating revenues described in the appraisal report, and thus, differs from NCF (Net Cash Flow) which is calculated by adding the profit from the investment of tenant deposits to and deducting capital expenditures from NOI. The appraisal NOI here is the NOI calculated using the direct capitalization method. As for Kitera Plaza Aobadai, the appraisal NOI is based on the NOI after the completion of the

1

Conversion, which is on the appraisal report as of February 16, 2022, and the appraisal NOI yield is calculated by dividing the appraisal NOI by the sum of the acquisition price and the assumed costs of the Conversion as of today.

4. After the acquisition, the property name is scheduled to be changed to the name in the table above, and the current property name is Konami Sports Club Aobadai.

2. Reason for the acquisition

KRR makes focused investment in shopping centers for daily needs while it has expanded its investment targets to distribution centers. The acquisition is made to diversify and enhance the portfolio to realize the growth of asset size and secure stable revenues, in accordance with KRR's investment targets and policies as set forth in its Articles of Incorporation.

In acquiring the properties, KRR especially evaluated the following points.

Furthermore, the lease agreement between the health club at Kitera Plaza Aobadai will expire on February 28, 2022. The Asset Manager will convert the property into a shopping center for daily needs, which are COVID-19 resilient, highly evaluating the property's proximity to Aobadai Station on Tokyu Den-en-toshi Line and its trade area, which is highly populated with high population growth. (Scheduled completion of the Conversion: late September 2022.) The prospective core tenant after the Conversion, OK Corporation, which operates grocery stores named OK, and a pharmacy store have executed fixed-term lease agreement with a condition of the property acquisition by KRR. The occupancy rate subject to the Conversion based on the contracts as of today is 53.7%. However, due to the lease agreement with the core tenant which is expected to draw high customer traffic, the remaining spaces are expected to attract tenants that deal with daily services including clinics.

T-33 Kitera Plaza Aobadai Acquisition highlight:

An NSC aiming to revitalize as a shopping center for daily needs with a grocery store and clinics, in an area with high population growth near Aobadai Station

1. Features of the building
2. • The property is a retail facility that is aiming to revitalize by conversing a large health club to an NSC. It is located near Tokyu Den-en-toshi Line's Aobadai Station, where express trains stop, and within commuter district of the Tokyo metropolitan area.
   • The grocery store, the prospective tenant after the Conversion, and the pharmacy have executed fixed- term lease agreement with a condition of the property acquisition by KRR. The property is expected to be operated as a convenient retail facility featuring tenants that deal with daily necessities and services including the grocery supermarket, OK, which is expected to draw high customer traffic, and clinics.
3. Overview of the surrounding area
4. 1. Location and access
   2. • The property is approximately 280m or a 4 minute walk from Aobadai Station on Tokyu Den-en-toshi Line. The average number of passengers using the station per day was over 110,000 before the COVID- 19 pandemic. There is a dense commercial area in front of the station.
      • The property has a highly populated trade area. Condominiums and apartment buildings stand close together around the station and quiet residential area lies beyond. While customer visits to the shopping center on foot or by bicycle are mainly anticipated, its proximity to Route 246, which runs from east to west, makes it convenient for cars to access.
   3. Characteristics of the surrounding area
   4. • Based on the 2015 Population Census, the population in the catchment area was approximately 40,000 people in the 1km radius, approximately 130,000 people in the 2km radius, and 234,000 people in the 3km radius. Compared to population numbers in 2010, the population in 2015 within the 1km, 2km and 3km radius were 102.5%, 101.6% and 101.4%, respectively. The area has many families with high income and with parents in their 40s.

2

L-9 Tenri Distribution Center Acquisition highlight:

A distribution center expecting an increase in demand due to expansion of logistics locations in the Greater Osaka area

1. Location and access
   The property is located in Tenri City, Nara Prefecture, in an area suitable for regional distribution and manufactures' storing and distribution. The area is adjacent to Koriyama Interchange on Nishi-Meihan Expressway and provides easy access to National Route 24 and Prefectural Route 193. The area is expected to become more convenient also for wide area distribution as an expansion of Keinawa Expressway from (tentative name) Yamato Koriyama Interchange to Kizu Interchange is being planned. In addition, the area is expected to see an increase in demand as logistics locations in the Greater Osaka area has been expanding in search of logistics facilities with lower rents because of a continuing rise in rents of logistics facilities in the inland Osaka area.
2. Features of the building

The facility is a low-rise and small-scale distribution center, which is common in regional areas. Low-rise distribution centers are evaluated higher than high-rise distribution centers in regional areas for their versatility as they can handle goods in many forms and sizes. The facility is also able to handle a wide variety of goods.

1. Tenant

Nippon Express Co., Ltd., a major logistics company, is the current tenant. The property has a relatively high chance of attracting tenants compared to other logistics facilities in the neighborhood due to its proximity to the interchange. A variety of potential re-tenants can be assumed, including wholesalers distributing daily goods or groceries within Greater Osaka area, local logistics companies and 3PL operators.

3. Details of the property

T-33 Kitera Plaza Aobadai

Property name	Kitera Plaza Aobadai
Type of specified asset	Trust beneficiary interest in real estate
Trustee		Mitsubishi UFJ Trust and Banking Corporation
Trust term		October 29, 2003 to March 31, 2042 (planned)
Location		2-2-2, Aobadai, Aoba-ku, Yokohama, Kanagawa
		Form of ownership	Proprietary ownership
		Land area	1,792.26 m2
Land		Zoning	Commercial area
		Building coverage ratio	80%
		Floor-area ratio	300%
		Form of ownership	Proprietary ownership
		Gross floor area	5,537.46 m2 (Note 1)
Building		Completion date	February 14, 1992 (Note 1)
		Usage	Gymnasium (Note 1)
		Structure/No. of stories	SRC /1 underground and 4-story building with slate roof (Note 1)
Master lessee		JLL Mall Management Co., Ltd. (planned)
Type of master lease	Pass-through type (planned)
PM		Kenedix Real Estate Fund Management, Inc.
Sub-PM		JLL Mall Management Co., Ltd. (planned)
			3

PML		7.2%
Acquisition price	2,553 million yen
Appraisal value	3,610 million yen (as of February 16, 2022)
Real estate appraiser	Daiwa Real Estate Appraisal Co., Ltd.
Collateral		None
Description of tenancy	(as of February 16, 2022)
	Number of tenants	2 (Note 2)
	Annual rent	Not disclosed (Note 3)
	Tenant deposits	Not disclosed (Note 3)
	Leased area	1,629.95 m2 (Note 2)
	Leasable area	3,037.22 m2 (Note 4)
	Occupancy rate	53.7% (Note 2) (Note 4)
Remarks		Not applicable
				Notes:
				1. The figures and the description are based on the registry as of
				January 31, 2022. Some of them are planned to be changed after
				the Conversion.
				2. The figures are based on the executed fixed-term lease
				agreement with a condition precedent.
Others		3. Not disclosed as the lessees' consent has not been obtained.
				4. The figures are estimates after the Conversion. The new core
				tenant has executed a fixed-term lease agreement, which is
				subject to a condition precedent of the property acquisition by
				KRR. In addition, the figures do not take the current tenant as
				of today into account as its lease will terminate on February 28,
				2022.
L-9 Tenri Distribution Center
Property name	Tenri Distribution Center
Type of specified asset	Trust beneficiary interest in real estate
Trustee		Mitsubishi UFJ Trust and Banking Corporation
Trust period		March 1, 2022 to March 31, 2042 (planned)
Location		87-3, Motoyagyukata, Minami-rokujocho, Tenri, Nara
			Form of ownership	Proprietary ownership
			Land area	3,808.32 m2
Land		Zoning	Quasi-industrial area
			Building coverage ratio	60%
			Floor-area ratio	200%
			Form of ownership	Proprietary ownership
			Gross floor area	7,011.86 m2
Building		Completion date	October 29, 1999
			Usage	Warehouse, office
			Structure/No. of floors	SRC / 6-story building
Master lessee		-
Type of master lease	-
PM		Kenedix Real Estate Fund Management, Inc. (planned)
Sub-PM		ITOCHU Urban Community Ltd. (planned)
PML		3.3%
				4

Acquisition price	1,070 million yen
Appraisal value	1,090 million yen (as of February 1, 2022)
Real estate appraiser	Daiwa Real Estate Appraisal Co., Ltd.
Collateral	None
Description of tenancy	(as of December 31, 2021)
	Number of tenants	1
	Annual rent	Not disclosed (Note)
	Tenant deposits	Not disclosed (Note)
	Leased area	7,393.08 m2
	Leasable area	7,393.08 m2
	Occupancy rate	100.0%
		Part of the boundary lines with adjacent land have not yet
Remarks	confirmed in writing. KRR, however, has agreed with the seller
that the boundary confirmation with the owner of adjacent land
		will be acquired at the expense and responsibility of the seller.
Others	Note: Not disclosed as lessee's consent has not been obtained.

4. Seller's profile

T-33 Kitera Plaza Aobadai

Name	Fuyo General Lease Co., Ltd.
Address	5-1-1 Kojimachi, Chiyoda-ku, Tokyo
Name and title of	President and CEO, Yasunori Tsujita
representative
Description of business	1.	Leasing of the following properties;
		(a)	machinery and equipment, machine tools, industrial tools,
			mining / beneficiation machinery,
			civil engineering and construction machinery,
			cargo / material handling equipment,
			chemical machinery and equipment, refrigerating machinery,
			textile machinery, forestry / fishery machinery,
			other industrial machinery, precision equipment, measuring instruments,
			optomechanical equipment, office equipment,
			electric / electronic equipment and hardware,
			automobiles, rolling stocks, ships, aircrafts,
			other transportation equipment,
			communication equipment, medical devices, commercial equipment,
			equipment for service facilities including car wash
		(b)	real estate
		(c)	intangible property right including trademark right, patent right, utility
			model right and design right
	2.	Sale, installment sale, import and export of the above properties
	3.	Sales of used assets
	4.	Financial services
	5.	Real-estate brokerage, appraisal, and management
	6.	Electronic power generation, providing, business regarding providing, sales,
		etc. of energy including electricity, and providing goods or service in
		environmental / energy field
	7.	Consultative services regarding company management, etc.
	8.	Providing business processing outsourcing, IT outsourcing, etc., to other
		companies
			5