Star Asia REIT to Swap JPY 9.6 Billion of Assets Including an Osaka Hotel and a Hakone Ryokan

Star Asia Investment Corporation announced on September 14, 2026, that it will acquire the real estate trust beneficiary rights in KOKO HOTEL Osaka Shinsekai in Naniwa-ku, Osaka, together with two silent partnership interests, for a combined JPY 6,605 million, and dispose of the trust beneficiary rights in Washington R&B Hotel Umeda Higashi in Kita-ku, Osaka, for JPY 3,010 million. It is the REIT's 13th asset rotation.

KOKO HOTEL Osaka Shinsekai has a scheduled acquisition price of JPY 3,926 million, an appraisal value of JPY 5,100 million and an appraisal NOI yield of 5.8%. The seller is ML Estate, a sub-sponsor under Mizuho Leasing, and the transaction uses that company's bridge scheme. The Star Asia group entered a capital and business alliance with the Mizuho Leasing group in February 2026, making this the first property acquisition under that arrangement.

The hotel is about a four-minute walk from Dobutsuen-mae Station on the Osaka Metro Midosuji and Sakaisuji lines. Completed in 2017, the nine-story building has 128 guest rooms. Minacia, a company under Polaris Holdings, serves as operator under a structure combining fixed monthly rent with variable rent.

There are two silent partnership investments. The JPY 1,679 million invested in Akatsuki LLC, representing 49.5% of total contributions, is backed by the former Kan'in-no-miya Gora Villa and its ancillary accommodation facilities, a luxury ryokan in Gora, Hakone, with an appraisal value of JPY 16,400 million. The JPY 1,000 million invested in Oak LLC, representing 8.13%, is backed by 17 residential properties in the Tokyo metropolitan area and Osaka, with a combined appraisal value of approximately JPY 33.6 billion and an appraisal NOI yield of 3.99%.

The scheduled disposition price for Washington R&B Hotel Umeda Higashi exceeds its appraisal value, and the REIT expects a gain on sale of approximately JPY 828 million against book value. The disposition is scheduled for January 29, 2027.

The REIT has set a new medium-term plan targeting distributions of at least JPY 1,913 and asset size of at least JPY 500 billion by 2030. After the rotation, the portfolio will comprise 73 properties worth JPY 273,739 million, and the average building age is expected to fall from 21.9 years to 21.7 years. Hotels will account for 40.6% of the portfolio by use.

Key Facts

• Property Name: KOKO HOTEL Osaka Shinsekai
• Buyer: Star Asia Investment Corporation
• Seller: ML Estate Co., Ltd.
• Acquisition Interest: Domestic real estate trust beneficiary rights
• Scheduled Acquisition Price: JPY 3,926 million
• Appraisal Value: JPY 5,100 million (as of August 1, 2026, Japan Real Estate Institute)
• Appraisal NOI Yield: 5.8%
• Contract Date: September 14, 2026
• Scheduled Acquisition Date: September 16, 2026
• Location: 6-16 Ebisu-Higashi 3-chome, Naniwa-ku, Osaka, Osaka Prefecture
• Nearest Stations: Approximately four-minute walk from Dobutsuen-mae Station on the Osaka Metro Midosuji Line and Sakaisuji Line / approximately six-minute walk from Shin-Imamiya Station on the JR Osaka Loop Line, JR Kansai Main Line and Nankai Main Line
• Completion: March 2017
• Number of Floors: 9F (steel-frame construction)
• Use: Hotel / Retail
• Guest Rooms: 128
• Area: Site area of approximately 274 tsubo (approx. 9,700 sq. ft.) / Gross Floor Area of approximately 1,021 tsubo (approx. 36,300 sq. ft.)
• Occupancy: 100.0% (as of the end of July 2026)
• Trustee: SMBC Trust Bank Ltd.
• Hotel Operator: Minacia Co., Ltd.
• PM Company: Tokyo Capital Management Co., Ltd.
• Rent: Fixed monthly rent of JPY 6.1 million plus variable rent (GOP for the month x 85% minus fixed monthly rent)

Acquired Assets (Silent Partnership Interests)

• Name: Akatsuki LLC silent partnership interest
• • Investment Amount: JPY 1,679 million (49.5% of total silent partnership contributions)
  • Seller: ML Estate Co., Ltd.
  • Contract Date: September 14, 2026
  • Scheduled Acquisition Date: September 14, 2026
  • Underlying Asset: Former Kan'in-no-miya Gora Villa and its ancillary accommodation facilities (1300 Gora, Hakone-machi, Ashigarashimo-gun, Kanagawa Prefecture)
  • Appraisal Value of Underlying Asset: JPY 16,400 million (Japan Real Estate Institute)
  • Underlying Asset – Completion: December 1989
  • Underlying Asset – Number of Floors: 2F / B7 (reinforced concrete construction)
  • Underlying Asset – Guest Rooms: 42 (including four detached villas)
  • Underlying Asset – Area: Site area of approximately 4,063 tsubo (approx. 144,600 sq. ft.) / Gross Floor Area of approximately 2,934 tsubo (approx. 104,400 sq. ft.) across nine buildings
  • Underlying Asset – Nearest Station: Approximately three-minute walk from Gora Station on the Hakone Tozan Railway
• Name: Oak LLC silent partnership interest
• • Investment Amount: JPY 1,000 million (8.13% of total silent partnership contributions)
  • Contract Date: September 18, 2026
  • Scheduled Acquisition Date: September 28, 2026
  • Underlying Assets: 17 residential properties (Tokyo metropolitan area 85.2%, of which Tokyo's 23 wards account for 63.6%; Osaka 14.8%)
  • Combined Appraisal Value of Underlying Assets: JPY 33,597 million
  • Appraisal NOI Yield: 3.99%
  • Average Building Age: 2.7 years (as of September 30, 2026)
  • Average Occupancy: 95.3% (as of June 30, 2026)
  • Total Leasable Area: Approximately 8,591 tsubo (approx. 305,700 sq. ft.)
  • Investment Period: September 28, 2026 to September 30, 2031

Disposition Property Overview

• Property Name: Washington R&B Hotel Umeda Higashi
• Seller: Star Asia Investment Corporation
• Buyer: Undisclosed (a domestic corporation)
• Disposition Interest: Domestic real estate trust beneficiary rights
• Scheduled Disposition Price: JPY 3,010 million
• Book Value: JPY 2,099 million (as of the end of July 2026)
• Expected Gain on Sale: JPY 828 million
• Appraisal Value: JPY 2,480 million (as of July 31, 2026, Daiwa Real Estate Appraisal Co., Ltd.)
• Contract Date: September 14, 2026
• Scheduled Disposition Date: January 29, 2027
• Location: 6-15 Sonezaki 1-chome, Kita-ku, Osaka, Osaka Prefecture
• Nearest Station: Approximately six-minute walk from Higashi-Umeda Station on the Osaka Metro Tanimachi Line
• Completion: October 2000
• Number of Floors: 9F (reinforced concrete construction)
• Use: Hotel
• Area: Site area of approximately 221 tsubo (approx. 7,900 sq. ft.) / Gross Floor Area of approximately 1,194 tsubo (approx. 42,500 sq. ft.)
• Occupancy: 100.0% (as of the end of July 2026)
• Trustee: Mitsubishi UFJ Trust and Banking Corporation
• PM Company: Best Property Co., Ltd.