Notice Regarding the Completion of Structuring and Commencement of Operations of NTT Urban Development's First Fund, the NU-1 Fund

Last updated：March 30, 2006

NTT Urban Development Corporation has completed the structuring of its first real estate fund, the NU-1 Fund, and commenced fund operations. Now that the structuring of this fund is complete, the Company will (1) use the fund to exit from its investment in properties developed through the office building development and sales business, (2) earn stable fee-based income from asset management and property management operations and (3) proactively take advantage of the increased number of opportunities to acquire property and collaborate on joint development projects.

1. Outline of the Fund

(1) Concepts	With a specific focus on the Tokyo metropolitan area, the fund invests in office and residential properties throughout Japan that offer stable returns, with the goal of an internal rate of return (IRR) of 7% or higher. The fund contains a portfolio of assets that includes property transferred from NTT Urban Development and real estate acquired from outside parties. We aim to expand the fund by acquiring additional properties.
(2)Investment period:	Three years
(3) Fund size:	Approximately ¥11.7 billion (initially)
(4) Equity investment:	Approximately ¥3.3 billion (initially)

2. Parties Involved

(1)Structuring, asset management, property management by NTT Urban Development
(2)Arranged by Daiwa Securities SMBC Co., Ltd.
(3)Investors include domestic institutional investors and NTT Urban Development

Note: This fund takes the form of a silent partnership. Owing to confidentiality agreements with investors, names and other information regarding investors will not be disclosed.

3. Impact on the Company

Owing to the completion of structuring and the commencement of operation of this fund, extraordinary ordinary income of ¥2,252 million will be added to the operating performance forecasts for the fiscal year ending March 31, 2006, that were released on November 7, 2005.

This announcement is not intended to solicit investment.