For Immediate Release

January 24, 2014
Investment Corporation: Daiwa House Residential Investment Corporation
7th Floor, Nissei Nagatacho Building
2-4-8 Nagatacho, Chiyoda-ku, Tokyo Tetsuji Tada, Executive Director (Code Number: 8984)
Asset Manager: Daiwa House Asset Management Co., Ltd.
Yuji Yamada, CEO & President
Inquiries: Hirotaka Uruma, CFO & Director Finance & Corporate Planning Department TEL: +81-3-3595-1265

Notice Concerning Debt Financing and the Repayment of the Rehabilitation Obligations

Daiwa House Residential Investment Corporation ("DHI") announces its decision to undertake debt financing and the repayment of the rehabilitation obligations. The details are as follows:
1. Details of Debt Financing
(1) Term Loan Agreement (Negotiated)

Use

Repayment of the rehabilitation obligations (loans and investment corporation bonds)

(Note 2)

Lenders

The Norinchukin Bank

Amount

¥3,500,000,000

Interest Rate

(Variable interest rate) (Note 1)

Basic interest rate (Japanese Bankers Association 1month yen TIBOR + 0.40%)

Loan Date (planned)

January 31, 2014

Interest Payment Date

First payment on the last day of February 2014 (or last business day of the months).

Subsequent payment on the last day of respective months and maturity date (or last business day of the respective months).

Repayment date

January 31, 2021 (or last business day of the months)

Repayment method

Principal repayment in full on the maturity date

Collateral

Unsecured, Unguaranteed

(Note 1) JBA 1 month yen TIBOR rate of two business days prior to the latest interest payment date will be use as the base rate to calculate the applicable interest rate for the current calculation period.

Please refer to JBA website ( http://www.zenginkyo.or.jp/en/tibor/) for the yen TIBOR.

(Note 2) Please refer to the 2. "Details of Repayment" below.

This English language notice is a translation of the Japanese language notice issued on the same day and was prepared solely for the convenience of,

and reference by, overseas investors. DHI makes no warranties as to its accuracy or completeness.

1


2. Details of Repayment
(1) Rehabilitation Obligations (loans)

Lenders

The Norinchukin Bank

Repayment Date (planned)

January 31, 2014

Maturity Date

January 31, 2014

Balance of Principal

¥3,039,055,695

Amount of Repayment

¥3,039,055,695

Interest Rate

Basic interest rate (Japanese Bankers Association 3month yen TIBOR + 1.00%)

(Variable interest rate)

Repayment method

Principal repayment in full on the maturity date

Collateral

Unsecured, Unguaranteed

(2) Rehabilitation Obligations (investment corporation bonds)

Bond Name

New City Residence Investment Corporation First Series Unsecured Investment

Corporation Bonds

Redemption Date (planned)

January 31, 2014

Maturity Date

January 31, 2014

Balance of Principal

¥534,789,876

Amount of Redemption

¥534,789,876

Interest Rate

Basic interest rate (Japanese Bankers Association 3month yen TIBOR + 1.00%)

(Variable interest rate)

Repayment method

Principal repayment in full on the maturity date

Collateral

Unsecured, Unguaranteed

3. Funds for the Repayment
The Repayment will be funded using Debt Financing announced today and cash on hand.
4. Future Prospects
The Debt Financing and Repayment will have only a minor impact on operating status forecasts for the fiscal period ending in February 28, 2014 (16th Fiscal Period: from September 1, 2013 to February 28,
2014) and August 31, 2014 (17th Fiscal Period: from March 1, 2014 to August 31, 2014), there is no revision to the operating status forecasts.
5. Other
For the risks concerning Debt Financing etc., there are no significant changes from the security registration statement (submitted on November 25, 2013).

This English language notice is a translation of the Japanese language notice issued on the same day and was prepared solely for the convenience of,

and reference by, overseas investors. DHI makes no warranties as to its accuracy or completeness.

2

[Reference]

Status of Balance of Interest-bearing Liabilities after Debt Financing and the Repayment (planned)

(Unit: million yen; rounded under million yen)

Before Debt Financing

and the Repayment

(as of December 30, 2013)

After Debt Financing

and the Repayment

(planned)

(as of January 31, 2014)

Increase

(Decrease)

Long-term loans (Note 1)

Term loan III

10,500

10,500

-

Long-term loans (Note 1)

Term loan IV

31,800

31,800

-

Long-term loans (Note 1)

Resona Bank-1

1,095

1,095

-

Long-term loans (Note 1)

Term loan V

7,000

7,000

-

Long-term loans (Note 1)

Term loan VI

7,000

7,000

-

Long-term loans (Note 1)

The Bank of Tokyo-Mitsubishi

UFJ-1

4,000

4,000

-

Long-term loans (Note 1)

Term loan VII

12,400

12,400

-

Long-term loans (Note 1)

Term loan VIII

7,600

7,600

-

Long-term loans (Note 1)

Term loan IX

17,410

17,410

-

Long-term loans (Note 1)

Development Bank of

Japan Inc.-1

1,500

1,500

-

Long-term loans (Note 1)

The Norinchukin Bank-1

-

3,500

3,500 (Note 2)

Total loans

100,305

103,805

3,500

Investment corporation bonds

3,000

3,000

-

Rehabilitation

obligations

(loans)

Maturity Date: Jan. 31, 2014

3,039

-

(3,039) (Note 3)

Rehabilitation

obligations

(loans)

Maturity Date: Jan. 30, 2015

14,327

14,327

-

Rehabilitation obligations (investment

corporation bonds)

Maturity Date: Jan. 31, 2014

534

-

(534) (Note 3)

Rehabilitation obligations (investment

corporation bonds)

Maturity Date: Jan. 30, 2015

534

534

-

Total rehabilitation obligations

18,435

14,861

(3,573)

Total interest-bearing liabilities

121,740

121,666

(73)

(Note 1) Long-term loans are loans with maturity periods of over one year. (Note 2) Increase attributable to debt financing announced today.

(Note 3) Decrease attributable to the repayment announced today.

* This press release is to be distributed to the Kabuto Club (the press club of the Tokyo Stock Exchange); the Ministry of Land, Infrastructure, Transport and Tourism Press Club; and the Ministry of Land, Infrastructure, Transport and Tourism Press Club for Construction Publications.

* URL of the DHI's website: http://daiwahouse-resi-reit.co.jp/eng /

This English language notice is a translation of the Japanese language notice issued on the same day and was prepared solely for the convenience of,

and reference by, overseas investors. DHI makes no warranties as to its accuracy or completeness.

3

distributed by