2008 INVESTOR PRESEnTATiOn

September 2008

Color

WWW.JAPANLEISUREHOTELS.COM

The information contained in these slides has been prepared by the directors of New Perspective Y.K. (the Asset Manager) for information purposes only and the information in these slides and the presentation made to you verbally is subject to updating, completion, revision, further verication and amendment without notice. These slides have not been approved by any nancial regulatory authority nor is it intended that they are so approved. These slides and the presentation do not constitute any part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall they or any part of them form the basis of or be relied on in connection with, or act as any inducement to enter into, any contract or commitment whatsoever. Recipients of these slides who are considering an investment in funds managed by the Asset Manager are reminded that any subscription must be made only on the basis of the information contained in the subscription documents in their nal form relating to the specic fund, which may be different from the information contained in these slides. No reliance may be placed for any purpose whatsoever on the information or opinions contained in these slides or the presentation or on their completeness, accuracy or fairness No undertaking, representation, warranty or other assurance, express or implied, is made or given by or on behalf of the Asset Manager or any of their respective directors, officers, partners, employees, agents or advisers or any other person as to the accuracy or completeness of the information or opinions contained in these slides or the presentation and no responsibility or liability is accepted by any of them for any such information or opinions or for any errors, omissions, misstatements, negligence or otherwise for any other communication written or otherwise.

These slides are condential and are being supplied to you solely for your information and may not be reproduced, re-distributed or passed to any other person or published in whole or in part for any purpose Certain statements included herein express the Asset Managers expectations or estimates of future performance, constitute Forward-looking Statements. Forward-looking Statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Asset Manager are inherently subject to signicant business, economic and competitive uncertainties and contingencies. Such Forward-looking Statements involve known and unknown risks, uncertainties and other factors that may cause the actual nancial results, performance or achievements to be materially different from estimated future results, performance or achievements expressed or implied by those Forward-looking Statements and as such the Forward-looking Statements are not guarantees of future performance. The Asset Manager expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, events or otherwise By accepting this presentation you agree to be bound by the foregoing provisions. For the purposes of this presentation Japanese Yen values have been translated into Pounds Sterling at an exchange rate of 190 Japanese Yen to one Pound Sterling.

Japan Leisure Hotels

Investment company established to invest in the cash generative Japanese Leisure hotel industry annual industry revenues of approximately 20 billion JLH Market capitalization of 22.5 million with potential to grow dramatically bigger subject to nancing 13% increase in NAV since JLHs admission to Aim First half operating cash ows total 145 million (763,000) Hotels purchased below replacement cost, re-branded and repositioned JLH seeking to be consolidator in a highly fragmented, often poorly managed, industry Improved transparency combined with industry restructuring will drive improving capital values over time through industry re-rating
1

Leisure Hotel Industry

According to a variety of sources, the number of leisure hotels in Japan is between 20,000 and 30,000 Each hotel has on average approximately 22 rooms Each room turns on average approximately 2.6 times a day Average spend per couple per turn is 6,540 (34) The estimated annual industry revenue is 4 trillion or more than 20 billion Total domestic travel in 2005, including hospitality, was 23 trillion, which accounts for 4.24% of GDP Leisure hotel use accounts for 18% of this gure and 0.75% of Japanese GDP As a result of increased gasoline prices and airline tickets, ankintan, meaning cheaper, closer and shorter travel, is becoming more popular among Japanese
2

Revenues
Average spend per occupancy Revenue per room Number presented in real Japanese yen indexed to 2000

20000 18000 16000 14000 12000

JPY

10000 8000 6000 4000 2000 0 1998 2000 2006 1999 2001 2005 2004 2002 2003 2007 1997

Source: Leisure Hotel Quarterly Managers Survey 1999-2007 published by Sogo Unicom Corporation

Portfolio
6 hotels, 5 Bonita branded hotels plus one newly acquired property New Acquisition purchased in August 2008 for 410 million yen for 47 hotel rooms, 8.7 million yen (45,800) per room Guest numbers and revenue over the whole portfolio remained resilient during the rst half of 2008 and exceeded budget over the summer Cost pressures: utility costs up 13% from 2007 on average Pressure on operating margins managed in two ways: Price rises gradually implemented across the portfolio since May 2008 Expense Management: Raw Material and Consumables cost down 25% on an annualized basis Employee costs down 8% on an annualized basis Other expenses down 10%
4

Premier Inn Comparison

Premier Inns Number of Rooms Occupancy Spend per customer RevPar EBITDA Margin EBITDA Per Room Share Price (P) P/NTAV 36,006 78.3% 94.91 74.31 42% 30.86 1130p 1.69x

Bonita 2007 195 254% 34.64 82.86 36.6% 30.30 N/A N/A

Bonita 1st half 2008 Annualized 195 253.2% 31.46 79.66 37.4% 29.8 51p 0.87x

Before

Bonita Sendai Room 602 before renovation

6

Japan Leisure Hotels

After

Bonita Sendai Room 602 after renovation

7

Leisure Hotel Market: An Excellent Time to Invest

Now is the chance to purchase performing assets from distressed sellers Since 1 January New Perspective, the Asset Manager, has reviewed over 100 hotels that were available for sale In August two mid-sized real estate companies led for court protection against creditors; Between them they own 24 leisure hotels Bankruptcies have been caused by issues in the nancial markets and not through poor performance of the leisure hotels they own Other leveraged owners are feeling nancial pressures from their lenders Owners that perceive leisure hotels as a non-core asset also seeking to exit

Current Hotel Investment Opportunities

For an investment of 6 million, both of the following indicative properties could be purchased
Hotel A Location Number of Rooms Gross Floor Area Year of Construction Last Renovated RevPar Indicative Purchase Price Indicative CAP Rate* Ibaraki 35 2,600 m2 1987 2005 16,500 600 million 14.5% Hotel B Osaka 33 2,700 m2 1992 2005 16,800 640 million 14.5%

*Cap rate is net cash ow after operating expenses and deducting reserves divided by the purchase cost

Financing
Japan impacted by credit conditions JREIT index down over 50% - with few deals proceeding with signicantly reduced leverage and higher spreads In active discussions with two balance sheet lenders and one securitization arranger. All the lenders are constrained by the current market conditions but we are making steady progress Our aim is to achieve modest leverage on the portfolio at the earliest opportunity to take advantage of the current opportunities to purchase additional hotels

10

Japan Leisure Hotels

Bonita Matsusaka
11

Investment Case
Fragmented industry with many owners, no dominant brands or operators and lack of professional management Cash generative assets and potential for capital appreciation Non correlated to economic performance in Japan and resilient in the face of economic slow down (see graph on page 3) Unleveraged portfolio no renancing issues Increased buying opportunities as a result of pressure from lenders and generational transfer Scope for increased operating performance following any acquisition Potential for rerating with the introduction of economies of scale, network benets and industry repositioning

12

Japan Leisure Hotels

Bonita Yamagata
13

Appendix

Bonita Sendai
14

Our Locations

15

Japan Macro A Nuanced But Positive Picture

As a leading exporter, Japans short term prospects inuenced by partners Q2 GDP weakness and poor short term prospects cloud underlying trends Japan has escaped the worst of the credit crunch and its slow down may be shorter and shallower than those in America and most European countries Strong household balance sheets in Japan Strong corporate balance sheets in Japan provide resilience against short term concerns Increasing ties with China (largest trading partner in July) provides an alternate growth engine to currently sputtering US and European demand These factors plus current domestic political uncertainty may dampen private consumption and depress short term growth prospects but do not suggest any serious medium term weakness

16

Strong Balance Sheets Underpin Economic Activity

Household Debt as a Percentage of GDP
2000 2008 2000 2008

Corporate Debt as a Percentage of GDP

1991 1.4 2008 1.4 1991 130% 2008 130%

1.2

1.2 100%

1.2
100%

1.2

1 78% 78%

0.8

0.8 71% 63% 0.6

71% 63%

71%

71%

0.8

0.8

0.6

0.6

0.6

0.4

0.4

0.4

0.4

0.2

0.2

0.2

0.2

0 Japan Japan UK UK

0 Japan Japan

17

Growth And Ination Is Good For Japan

Japan reduced its scal decit from 8.2% of GDP in 2002 to around 4% in 2007 GDP per capita increased at 2.1% per annum over the period 2002-2007, bringing it into line with the OECD average Japans prices are on the rise and are expected to give companies back their pricing power and employees their wage rises There is a growing awareness of rising prices 50.8% of Japanese households 1,545 trillion nancial assets are in cash and bank deposits earning next to nothing With ination reducing the value of savings, it is predicted that households will begin to shift savings out of cash and into shares and property to earn additional income

18

Consumer One-Year Ination Expectation

Increase
100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0%
year age

No change

Decrease

04 <30

04 30-59

05 <30

05 30-59

06 <30

06 30-59

07 <30

07 30-59

08 <30

08 30-59

19

Source: Japanese Government, Cabinet Office 2008, Consumption Trend Survey

Japan Job Offers Leisure to Job Hotels Seekers Ratio

National

2 1 .8 1 .6 1.4 1 .2 1 0 .8 0 .6 0 .4 0 .2 0

At 52%, overall labour force participation rate in Japan is among the highest in the OECD area Improvement can be seen in the job-offer-to-applicant ratio, which remained above 1 in 2006 and 2007 Increased private consumption (at a 1.4% annual pace between 2002 and 2007) Projections of wage rises; private consumption is estimated to increase by 1.25% 2008-2009
Source: The Japan Institute for Labour Policy and Training 2008.

20

Even without a scal stimulus, we believe the recovery will become clear from next year, when the US economy is expected to see a gradual recovery, says Akira Maekawa, senior economist at UBS in Tokyo.

Source: FT.com

Color

WWW.JAPANLEISUREHOTELS.COM