Sankei Real Estate Faces Second Tender Offer and Sells Large Fukuoka Building

City Index Fifth announced on September 25, 2026, that it will conduct a tender offer for the investment units of SANKEI REAL ESTATE Inc. from September 28 through November 10. The tender offer price is JPY 125,000 per unit, and the aim is to take the REIT private. The REIT expressed its support for the tender offer the same day, leaving the decision on whether to tender to individual unitholders.

The tender offer price represents an 18.93% premium to the previous business day's closing price of JPY 105,100 and also exceeds the REIT's net asset value per unit of JPY 114,099 as of the fiscal period ended February 2026. It is the second tender offer following an unsuccessful one launched by Tosei and others at the same price in January 2026. Four special related parties — City Index Eleventh, ATRA, C&I Holdings and Aya Nomura — hold a combined 29.90%. If the tender offer succeeds, a unit consolidation will be carried out, with the take-private expected to be completed by the end of February 2027.

The special related parties on the offeror side state that, amid indications that Fuji Media Holdings, the parent company of The Sankei Building, has been privately considering the introduction of outside capital into its real estate business, they took issue with the REIT having supported the previous tender offer without a bidding process, judged the tender offer price to be undervalued, and began accumulating units from January 2026. They have also indicated an intention to negotiate an agreement to tender their units to a competing tender offer at a higher price, should one meeting certain conditions emerge.

The same day, the REIT decided to sell Fukuoka Green Building in Momochihama, Sawara Ward, Fukuoka City, to a domestic corporation for JPY 5.5 billion, with delivery scheduled for October 13. Completed in 1996, the building has 14 floors above ground and one below, with a standard floor area of approximately 322 tsubo (approx. 11,500 sq. ft.). Occupancy has remained depressed since the lease with its single whole-building tenant was terminated by mutual agreement in September 2025, standing at 0% as of the end of February 2026. The transfer price exceeds both the book value of JPY 5.102 billion and the appraisal value of JPY 4.91 billion.

Tender Offer Overview

• Offeror: City Index Fifth Co., Ltd.
• Target: SANKEI REAL ESTATE Inc.
• Tender Offer Price: JPY 125,000 per investment unit
• Tender Offer Period: September 28, 2026 to November 10, 2026 (30 business days)
• Number of Units to Be Purchased: 375,636 units (minimum 118,732 units, no maximum)
• Settlement Commencement Date: November 17, 2026
• Holdings of Special Related Parties: 139,646 units (ownership ratio 29.90%)
• Purpose: Take-private (unit consolidation planned upon completion)
• Target's Opinion: Support (decision on tendering left to unitholders)

Disposition Property Overview

• Property Name: Fukuoka Green Building
• Seller: SANKEI REAL ESTATE Inc.
• Buyer: Undisclosed (a domestic corporation)
• Asset Transferred: Real estate trust beneficiary interest
• Transfer Price: JPY 5.5 billion
• Book Value: JPY 5.102 billion (as of the end of February 2026)
• Difference Between Transfer Price and Book Value: JPY 288 million (reference figure after deducting transfer-related expenses)
• Appraisal Value: JPY 4.91 billion (valuation date August 31, 2026, Japan Real Estate Institute)
• Contract Date: September 25, 2026
• Scheduled Transfer Date: October 13, 2026
• Location: 2-1-1 Momochihama, Sawara-ku, Fukuoka-shi, Fukuoka
• Completion: February 1996
• Number of Floors: 14F / B1 (steel-frame and steel-reinforced concrete construction)
• Use: Office
• Ownership Type: Ownership of both land and building
• Site Area: approximately 3,013 tsubo (approx. 107,200 sq. ft.) / Standard Floor Area: approximately 322 tsubo (approx. 11,500 sq. ft.) / Gross Floor Area: approximately 8,022 tsubo (approx. 285,500 sq. ft.) / Leasable Area: approximately 4,413 tsubo (approx. 157,000 sq. ft.)
• Number of Tenants: 0 / Occupancy: 0.0% (as of the end of February 2026)