Sun Frontier Fudousan Co., Ltd

Financial Results for the First Quarter of
Fiscal Year Ending March 31, 2025
We are aiming to be the most appreciatedvisionary company in the world.

August 8, 2024
Securities Code : 8934

Contents

1.

Overview of the Results for FY2025/3 1Q

P. 2

2.

Forecast for FY2025/3 and Business Initiatives

P.12

3.

Medium-term Management Plan

P.26

4.

Philosophy and Business Initiatives

P.36

5.

References Materials

P.59

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

1

Sun Frontier Fudousan Co., Ltd

Overview of the Results for FY2025/3 1Q
Overall sales and profit decreased YoY due to fewer sales of large-scale properties in 1Q.
In stock-type businesses such as Real Estate Services Business and Hotel Operation
Business, both sales and profit increased and hit record highs.
(Unit: million yen)

Results

Net sales
Operating profit
Ordinary profit
Profit※15,685
2,834
2,739
1,878

Profit margin

Year-on-year

Growth rate

Forecast（disclosed on

100,000
20,87020,00014,000－-2,766-15.0%

18.1%-1,372-32.6%

17.5%-1,444-34.5%

12.0%-1,256-40.1%

Feb. 8, 2024）

Achievement
rate

15.7%
13.6%
13.7%
13.4%

*The profit attributing to owners of parent.

Performance Highlights• Sales including large-scale properties will accelerate from the second quarter. The sale (including contract-based sale) as of the day of thisfinancial presentation is 30% of the full-year financial results forecast.
• In Replanning Business, both sales and profits increased as the number of sales increased YoY and the profit margin maintained a highlevel.
• In Real Estate Service Business, the performance is well with exceeding targets mainly due to the PM Business, which saw an increase in
the number of entrusted buildings, and the Rental Conference Room Business, which saw an expansion of the new sites.
• In Hotel Operation Business, both sales and profits grew significantly due to continued strong inbound demand backed by the weak yen.
• In Hotel Development Business, the sale of properties is scheduled in the second half of the year. M&A and acquisition of land fordevelopment are in progress to increase the number of hotel rooms.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

2

Sun Frontier Fudousan Co., Ltd

Consolidated Income Statement(Unit: million yen)

Net sales
Real Estate Revitalization Business
Replanning Business
Rental Buildings Business

Real Estate Service Business
Hotel and Tourism Business
Hotel Development Business
Hotel Operation, etc

Other Business
Adjustments

Gross Profit (Loss)
Real Estate Revitalization Business
Replanning Business
Rental Buildings Business

Real Estate Service Business
Hotel and Tourism Business
Hotel Development Business

Hotel Operation, etc

Other Business
Adjustments

Selling, General and
Administrative Expenses
Operating Profit (Loss)
Ordinary Profit (Loss)
ProfitEPS

FY2024/3
1Q

FY2025/3
1Q

increase/decrease

YoYchange rate

18,452
7,693
7,083
609
2,665
8,029
5,270
2,759
368
-303
6,306
2,261
2,125
135
1,557
2,665
2,200
465
45
-223

15,685
8,711
8,020
690
3,119
3,681
0
3,681
481
-308
5,194
2,638
2,591
47
1,699
888
-0
888
172
-204

- 2,766-15.0%

1,018

13.2%

936

13.2%

81

13.4%

454

17.1%

- 4,348-54.2%- 5,270

－

921

33.4%

112

30.6%

2,099
4,206
4,184
3,134
64.60 yen

YoY

-5

－

- 1,112-17.6%

377

16.7%

465

21.9%

-88

-65.1%

1419.1%- 1,777-66.7%- 2,200

－

423

91.0%

127

282.0%

18

－

2,359

259

12.4%

2,834
2,739
1,878
38.68 yen

- 1,372-32.6%- 1,444-34.5%- 1,256-40.1%- 25.92yen-40.1%

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3

Keynotes of Income Statement<Real Estate Revitalization Business>
The number of sales was 6 (+1 YoY). The progress rate
against the financial results forecast is over 30%, including
the number of sales of contracted and shortly settled
properties.
<Real Estate Service Business>
The performance of the PM Business, which saw an increasein the number of entrusted buildings, and the Rental
Conference Room Business, which saw an expansion of the
new sites, led to record highs for the first quarter.
<Hotel and Tourism Business>
Driven by robust inbound demand, Hotel Operation grewsignificantly in both sales and profits. The overall
performance of Hotel Development was affected by arebound of the sale of one hotel in the same period of theprevious year.

<Selling, General and Administrative Expenses>
Increased as planned from the same period of the previous
year as personnel expenses increased due to human capital
investment, and depreciation expenses increased due toproactive business investment and system investment, etc.

Sun Frontier Fudousan Co., Ltd

Consolidated Balance Sheet- Assets Decreased by 7.5 billion yen from the end of the previous fiscal year due to progress in purchasing properties, tax
payments and dividends.

<Cash and deposits>

Increased by 12.3 billion yen from the end of the previous fiscal year due to purchase and constructionof land or properties for RP products small-lot real estate products and hotel development.

<Inventories>(Unit: million yen)

As of End of
March 2023

As of End of
March 2024

As of End ofJune 2024

Increase/decrease(compared to the End of
March 2024)

125,886

159,518

163,738+4,220Cash and deposits

42,01647,86740,317-7,550Inventories

80,182

106,869

119,213+12,344

70,327

95,927103,209+7,283

9,750

9,545

14,509+4,963

105

1,398

1,494

+97

Other current assets

3,688

4,780

4,207

-572

Non-current assets

26,63329,14329,807+664

Property, plant and equipment

20,41022,323

22,662

+339

815

1,193

1,150

-43

5,406

5,626

5,994

+368

152,519

188,661

193,546+4,885Current assets

Breakdown) RP※
Hotel
Overseas, etc.

Intangible assets
Investments and other assets
Total assets

Note : Includes properties in small-lot real estate properties and New York properties.

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4

Sun Frontier Fudousan Co., Ltd

Consolidated Balance Sheet- Liabilities/Equity Increased by 5.1 billion yen due to borrowings for purchase of properties.
10 billion yen was raised through CB issuance in the third quarter of theprevious fiscal year, resulting in a total of 84.6 billion yen in interestbearing debt.

<Interest-bearing debt><Equity ratio>

Maintained at a high level of 47.1% while actively investing.
(Unit: million yen)

Current liabilities

As of End of
March 2023

As of End of
March 2024

Changes of Equity Ratio
As of End of
March 2023

As of End of
March 2024

As of End ofJune 2024

52.9%

48.0%

47.1%

As of End ofJune 2024

Increase/decrease(compared to the End of
March 2024

16,36324,767

19,962-4,804

5,492

12,2698,765-3,504

Other current liabilities

10,871

12,497

11,197-1,299Non-current liabilities

52,19069,47778,450+8,973Long-term borrowings

50,17057,272

65,913+8,640

0

9,999

9,999

0

2,019

2,205

2,537

+332

Total liabilities

68,553

94,244

98,413+4,168

Shareholders' equity

80,43089,88990,210

+320

3,535

4,526

4,923

+396

83,965

94,416

95,133+716

152,519

188,661

193,546+4,885

Short-term borrowings, etc.

Bonds payable
Other non-current liabilitie

Other
Total net assets
Total liabilities and net assets

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5

Sun Frontier Fudousan Co., LtdPerformance for Each Business Segment

Real Estate Revitalization Business (Replanning and Rental Buildings)<Replanning Business>◼ The number of sales was 6 (+1 YoY). Both sales and profit(million yen)increased YoY.

Net sales
売上高
Segment profit
セグメント利益
Profit margin
利益率

10,00050%◼ The average business period was 583 days (down 122 days YoY).

8,711

There were a lot of short-term properties sold in this period,

7,693

resulting in a significant shortening of the business period.

(Unit: million yen)

FY2024/3
1Q

FY2025/3
1Q

7,500

Increase/decrease

Net sales

7,693

8,711

+13.2%

Replanning Business

7,083

8,020

+13.2%

609

690+13.4%

Segment profit ※1

2,047

2,348

+14.7%

Replanning Business

1,911

2,300

+20.4%

135

47-65.1%

Profit margin

26.6%

27.0%

+0.3%pt

Replanning Business

27.0%

28.7%

+1.7%pt

Rental Building Business

22.3%

6.9%

-15.4%pt

5 cases

6 cases+1 cases

57 cases ※2

59 cases ※2+2 cases

Rental Building Business

Rental Building Business

Number of properties soldNumber of stocks

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

6

26.6%

27.0%

5,000

2,500

25%

2,047

2,348

0

0%

FY2024/3
24/3期
1Q
4-6月期

FY2025/3
25/3期
1Q
4-6月期

※1 “Segment profit” is calculated by deducting specific costs of each segment, includinginterest expenses, sales commission and amortization of goodwill from gross profit.
※2 Land purchase and development projects are included.

Sun Frontier Fudousan Co., LtdPerformance for Each Business Segment

Real Estate Revitalization Business<Purchasing properties of Replanning Business>

FY2024/3
1Q

FY2025/3
1Q

Increase/decrease

24 cases

20 cases-4 cases

9 cases

6 cases-3 cases

Purchase amount

22,51017,153-5,357(of which, contracted and unsettled)

12,5903,428-9,162(Unit: million yen)

The purchase amount, including contracted and unsettled properties,
Number of properties purchased
is 17.1 billion yen.
More than 30% progress toward the full-year purchase target of 55(of which, contracted and unsettled)
billion yen.
Note : Includes properties in non-current assets, small-lot real estate
properties and New York properties.

(million yen)
Target of this year

60,00055,00050,74840,00036,281

38,28632,86020 cases
9 cases for contracted but
unsettled

27,60020,00017,153

15,0360
FY2019/3
19/3期

FY2020/3
20/3期

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FY2021/3
21/3期

FY2022/3
22/3期

7

FY2023/3
23/3期

24/3期
FY2024/3

FY2025/3
25/3期1Q
1Q

Sun Frontier Fudousan Co., LtdTrends in Inventories and Gross Profit of Property
Sales
Ahead of the Medium-Term Management Plan Targets, aggressively invest for sustainable growth and plan to build
up inventories

61.7 billion yen

53.7 billion yen

70.0 billion yen

Cost of property sales

33.1 billion yen

40.3 billion yen

44.9 billion yen

36.1billion yen

49.0 billion yen

Gross profit ※Gross profit margin

12 billion yen
RP 9.2 billion yen
Hotel 2.8 billion yen

26.6%

Affected by COVID-19, both net
sales and purchase decreased,
and causing the decrease of
the balance of inventories .

Keepholding

77.3 billion yen

27.2%
47.7 billion yen

Keepholding

Although COVID-19 prolonged,
sales were good. Started refocusing onpurchases, but the balanceof inventories declined.

80.1 billion yen
Sales remained strong.
The results of strengthening
purchase emerged, leading to
the increase of the balanceof inventories .

17.6 billion yen
RP 15.5 billion yen
Hotel 2.1 billion yen

32.8%
62.8 billion yen

Keepholding

Increase in the balanceby selling as planned and investing
aggressively.

RP 20.0 billion yen
Hotel 1.0 billion yen

30.0%

62.2~67.2
billion yen

Keepholding

106.8 billion yen

21.0 billion yen

Carryover86 billion yen

31.6 billion yen

RP 15.3 billion yen
Hotel 1.5 billion yen

CarryoverEnding balance of theinventory

29.2%

16.8 billion yen

Carryover

27.4 billion yen

RP 16.0 billion yen
Hotel 0.7 billion yen

CarryoverPurchases during the
fiscal year,
construction work, etc.

16.7 billion yen

Sale during the year

57.0 billion yen

Sale in the following fiscal year

45.1 billion yen

Sale during the year

Sales of properties

Sale in the following fiscal year

FY2025/3(Forecast)Sale during the year

FY2024/3(Results)

Sale in the following fiscal year

FY2023/3(Results)

Sale during the year

FY2022/3(Results)

Sale in the following fiscal year

FY2021/3(Results)

120.0~125.0
billion yen

Aggressively invest for the next fiscal
year and beyond while selling at highmargins and achieving the MediumTerm Management Plan

Ending balance for FY2025/3(Forecast)Gross profit margin(Assumed)

Net sales (Assumed)

Unrealized gains on inventories(Assumed)

120.0~125.0 billion yen

25~30%

160.0~178.5billion yen

40.0~53.5 billion yen※ Gross profit ＝ ordinary profit － sales commission

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8

Sun Frontier Fudousan Co., LtdPerformance for Each Business Segment

Real Estate Services Business(Property Management, Building Maintenance,
Sales Brokerage, Leasing Brokerage,
Rental Conference Room, Rent Guarantee, etc.)<Property Management and Building Maintenance>◼ Business, both sales and profit increased due to an increase in thenumber of entrusted buildings◼ In BM Business, sales increased due to an increase in the number ofmanaged buildings, but profits did not increase due to an increase incosts associated with rising prices.

Net
sales
売上高
Segment
profitセグメント利益(million yen)

Profitmargin
利益率

4,000<Brokerage>◼ Leasing brokerage was flat compared with the same period of theprevious year.
◼ Sales brokerage, in addition to referral projects, projects for repeat
customers and new customers also led steadily to contracts, resulting
in a strong performance.

3,000<Rental Conference Room>◼ New sites contributed to sales and profit growth while making progressin investment for further expansion of sites.

2,000

100%

3,119

58.2%

1,551

<Rent Guarantee>◼ Both sales and profit increased YoY due to an increase in the number of
new contracts.

75%

2,665
54.4%
1,696

1,000
(Unit: million yen)

FY2024/3
1Q

FY2025/3
1Q

25%

Increase/decrease

Net sales

2,665

3,119

+17.1%

Segment profit ※1

1,551

1,696

+9.4%

Profit margin

58.2%

54.4%

-3.8%pt0

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50%

9FY2024/3
24/3期
1Q
4-6月期

FY2025/3
25/3期
1Q
4-6月期

0%

※1 “Segment profit” is calculated by deducting specific costs ofeach segment, including interest expenses, sales commission andamortization of goodwill from gross profit.
Sun Frontier Fudousan Co., LtdPerformance for Each Business Segment

Hotel and Tourism Business (Hotel Development, Hotel Operation, etc.)<Hotel Development Business>◼ Both sales and profit decreased due to a reaction of the sale of
one hotel in the previous year.

(million yen)

10,000◼ Making a progress in land acquisition in Karuizawa, Akita, etc.,
and many ongoing development projects in other regions.

8,000◼ Both sales and profit increased significantly due to an increasein occupancy rate and average daily rate as travel demand
continued to expand and inbound demand recovered.
FY2024/3
1Q

6,000-54.2%

Hotel Development Business

5,270

0

－

Hotel Operation Business, etc.

2,759

3,681

33.4%

2,638

845

-68.0%

Hotel Development Business

2,173

-22

－

Hotel Operation Business, etc.

465

867

86.5%

32.9%

23.0%

-9.9%pt

Hotel Development Business

41.2%

－

－

Hotel Operation Business, etc.

16.8%

23.6%

6.7%ptProfit margin

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30%

23.0%

Increase/decrease

FY2025/3
1Q

3,681

Segment profit ※2

40%

32.9%

8,029

Net sales

50%

8,029

<Hotel Operation Business ※1>(Unit: million yen)

Net sales
売上高
Segment profit
セグメント利益
Profit margin
利益率

10

3,681

4,000

20%

2,638
2,000

10%

845
0

FY2024/3
FY2025/3
24/3期
25/3期
1Q
1Q
※1 There is Profitof Hotel Rental included.
4-6月期
4-6月期

0%

※2 “Segment profit” is calculated by deducting specific costs ofeach segment, including interest expenses, sales commission andamortization of goodwill from gross profit.
Sun Frontier Fudousan Co., LtdPerformance for Each Business Segment

Other Business (Construction Business, Overseas Development Business, etc.)<Construction Business>

Net
sales
売上高

◼ Both sales and profit increased due to an increase in sales of(million yen)percentage of construction completion method at a Group

500

Segment
profitセグメント利益
Profitmargin
利益率

481

50%

subsidiary compared to the previous year and settlement oflabor costs for completed projects in the previous fiscal year.

400

40%

368
32.6%

<Overseas Development Business>◼ Construction of the second condominium project in Viet Nam

300

30%

200

20%

(HIYORI Aqua Tower), for which land was acquired, is scheduled
to begin in August 2024.

157(Unit: million yen)

Net sales
Segment profit ※1

Profit margin

FY2024/3
1Q

FY2025/3
1Q

Increase/decrease368

481+30.6%

33

157+371.5%

9.0%

32.6%

23.6%pt

100

9.0%

10%

33
0

FY2025/3
FY2024/3
24/3期
25/3期
1Q
1Q
4-6月期
4-6月期
※1 “Segment profit” is calculated by deducting specific costs of0%each segment, including interest expenses, sales commission andamortization of goodwill from gross profit.

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11

Sun Frontier Fudousan Co., Ltd

Forecast for FY2025/3 and Business Initiatives
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

2025年3月期 業績予想に対する進捗(Unit: million yen)

Result for FY2024/3

Forecast for FY2025/3

Result for FY2025/3 1Q

Progress Rate

Net sales

79,868100,000

15,685

15.7%

Real Estate Revitalization Business

51,027
48,395
2,632
10,497
16,977
5,270
11,7072,409-1,04369,80067,0002,800
11,65017,4303,000
14,4302,560-1,440

8,711
8,020
690
3,119
3,681
0
3,681
481
-308

12.5%
12.0%
24.7%
26.8%
21.1%
0.0%
25.5%
18.8%
－

Gross Profit (Loss)

26,40531,000

5,194

16.8%

Real Estate Revitalization Business

16,593
15,981
612
5,636
4,440
2,200
2,240
352
-618

21,23020,600
630
6,300
3,840
1,100
2,740
420
-790

2,638
2,591
47
1,699
888
-0
888
172
-204

12.4%
12.6%
7.5%
27.0%
23.1%
0.0%
32.4%
41.1%
－

8,804

10,130

2,359

23.3%

Operating Profit (Loss)

17,60020,870

2,834

13.6%

Ordinary Profit (Loss)

17,37420,000

2,739

13.7%

Profit11,917

14,000

1,878

13.4%

EPS

245.50 yen

288.41 yen

38.68 yen

13.4%

Replanning Business
Rental Buildings Business

Real Estate Service Business
Hotel and Tourism Business
Hotel Development Business
Hotel Operation, etc

Other Business
Adjustments

Replanning Business
Rental Buildings Business

Real Estate Service Business
Hotel and Tourism Business
Hotel Development Business
Hotel Operation, etc

Other Business
Adjustments

Selling, General and
Administrative Expenses

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13

Sun Frontier Fudousan Co., LtdTrends in Ordinary Profit for recently
5 fiscal years
Progress against the financial results forecast was in line with the plan. Many ofthe planned sales of the properties are scheduled for 2Q or later.
Full year forecast(million yen)

1Q

2Q

3Q

20,000

4Q

20,00017,374

16,127
15,000Initialforecast
14,00014,722
2,830

12,215Initialforecast
11,5002,255
10,000Initialforecast
6,500

5,000

9,758

7,524

3,472

321
1,958

232
6,366

2,698

1,284

Initialforecast
12,800Initialforecast
16,000

2,008
1,345

962

7,760

1,178

3,432

7,277

2,739

6,690

4,184
1,952
0

FY2020/3
20/3期

FY2021/3
21/3期

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FY2022/3
22/3期

14

FY2023/3
23/3期

FY2024/3
24/3期

FY2025/3
25/3期 1Q
Sun Frontier Fudousan Co., Ltd

Progress of Flow-Type Businesses(Sale of properties in RP Business,
Hotel Development Business,
Overseas Development Business)

Steady progress of more than 30% against the full-year forecast, including
contracted sales of properties.
Full year forecast
70,000(million yen)

60000

61,70656,980

As of the day of the financial
presentation for 1Q (August 8,
2024)
For properties contracted andscheduled to be settled

53,66540000
Progress

30.1%
Full year forecast

17,26420000

18,181

17,22821,08321,700Progress

13,062

31.3%

6,794
8,021
0

Ordinary
売上総利益
profit
22/3期
FY2022/3

Net
sales
売上高

Ordinary
売上総利益
profit23/3期
FY2023/3

Ordinary
売上総利益
profit24/3期
FY2024/3

Net
sales
売上高

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Net
sales
売上高

15

4,206
2,588

Ordinary
売上総利益
profit25/3期1Q
FY2025/3 1Q

Net
sales
売上高

Sun Frontier Fudousan Co., Ltd

Progress of Stock-Type Businesses(All businesses other than sale ofproperties such as Real Estate Services,
Hotel Operation Business, etc.)

Continued growth in sales and profits. Both sales and gross profit hit record highs in the firstquarter of the current fiscal year. Full year forecast
売上高の推移Trendsin Net Sales(million yen)

30,00030,000Resort for 1Q
1Q実績
25,000

売上総利益の推移
Trends in Ordinary Profit(million yen)
10,00026,201

Resort for 2Q – 4Q
2~4Q実績

Full year forecast

9,300

Resort for 1Q
1Q実績
Resort for 2Q – 4Q
2~4Q実績

8,221

8,000

21,07220,000

5,578

6,000
15,00019,832

14,271

5,953

15,973
10,0004,000

Progress

10,592

5,099

6,369

YOY
+20.2%

2,000
1,257

7,658
0

0

FY2022/3
22/3期

27.9%

2,199

5,000

3,679

Progress

3,988

25.5%

FY2023/3
23/3期

FY2024/3
24/3期

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942
FY2022/3
22/3期

FY2025/3
25/3期1Q

16

1,590
FY2023/3
23/3期

YOY
2,591
+14.2%
2,268

FY2024/3
24/3期

FY2025/3
25/3期1Q

Sun Frontier Fudousan Co., Ltd

Business Environment Awareness1. The global economy is showing signs of a slowdown in inflation trends, with expectations of interest rate cuts in
Europe and the United States, leading to a potential soft landing.
◆The IMF has not changed its global growth forecast for 2024 of 3.2%, despite concerns over prolonged inflation.

◆While the U.S. Federal Reserve is figuring out the right timing of the start of interest rate cut, attention should be paid to theoutcome of the U.S. presidential election.

2. The Japanese economy is facing uncertainty as the financial markets become chaotic due to a sudden surge inthe yen and a sharp drop in stock prices, triggered by a policy rate hike.
◆Despite the continued rise in prices, personal consumption is expected to remain firm due to rising wages and incomes.
◆The Bank of Japan decided to raise its policy interest rate by about 0.25% and reduce its amounts of purchases of Japanese
government bonds, suggesting the possibility of further rate hikes.

3. In the central Tokyo office building market, vacancy rate will continue to decline and rents will continue to riseas the demand for office is recovering.
◆The new supply of office space was less than the previous year, vacancy rate is expected to decrease, and rents are expected tobottom out and gradually rise.
◆Despite rising expectations for higher interest rates, the desire to invest in real estate remains strong.

4. In the hotel and tourism market, inbound demand has been brisk due to the depreciation of yen, and domestic
travel demand has been also strong.
◆From April to June 2024, spending by foreign visitors to Japan hit a record high of 2.1 trillion yen.
◆ The number of foreign visitors to Japan reached a record high of 3.13 million in June and 17.77 million in the six months fromJanuary.
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

17

Sun Frontier Fudousan Co., LtdReplanning Business, An Example of Initiatives (1)Renovated a building acquired through real estate M&A into one with excellent design andfunctionality.
Real estate M&A
Payment ofconsideration
Seller Company

ReplanningOur
company

Stock

Buyer Company

Sell renovatedbuilding

Transfer

Acquisition[Building exterior] Sendagaya Head Office Building, Shibuya-ku, Tokyo
4-story reinforced concrete building with deck roof

A telephone conference booth is also installed in
the spacious and bright office

A meeting room made of glass with soft light shining
through

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

18

A wood-grain interior that harmonizes with thegreenery spreading over the windows

Sun Frontier Fudousan Co., LtdReplanning Business, An Example of Initiatives (2)Converted parking lots to office space to increase operating area and improve profitabilityof buildings.
BeforeAfter

Parking lot on the first floor, which had been losing
profitability due to low occupancy

Converted to a set-up office and increased profitability

After[Building exterior]Nihonbashi Kodenmacho, Chuo-ku, Tokyo
8-story steel structure building with deck roof

Renovated entrance with a sense of unity thatmatches the color tone of the office converted fromthe parking lot

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

19

Various fixtures in the lounge can support various
working styles and stimulate communication

Sun Frontier Fudousan Co., Ltd

Specified Joint Real Estate Ventures

Promote Sales of Small-lot Real Estate Property
In addition to promoting sales of educational and medical facilities, launched new small-lot
real estate property.
Now on Sale

Now on Sale

23 wards of Tokyo

Sold out in
February 2024.
licensed nurseryschoolItabashi
NerimaTaito

Compass Oyama (Condominium type)A licensed nursery school in Oyama, Itabashi, Tokyo

Sale in April 2024
Now on Sale

5 citiesof central
Setagaya Tokyo

Sold out inMarch 2023.
Licensed
nursery school

Compass JINUSHI
In front of Keio University
Land Owner Project. Sale in June
2024
Landlord project

Ota
Building(Leaseholders)
Rent
Land
(Voluntary Partnerships)

Sold out inAugust 2021.

Compass Sakurashinmachi

licensed nurseryschoolInternational Academy in Sakurashinmachi,
Setagaya, Tokyo

Sale in December 2023
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Sold out inNovember 2022
medical andeducational mall20

Own sub-divided land. Stable
investment income can be obtained
over a long-term by the rent fromthe leaseholders.

Sun Frontier Fudousan Co., LtdConference Room Rental Business

Strong Performance at New Sites
Continuing Opening New Sites Actively
The performance was strong due to the effects of new site openings and floor space
expansion, and an increase in repeat customers. Plan to open more sites in the future.
◆Trends of Net sales for Conference Room and Operating(million yen)area of Vision Center
Target of this year
10,0008/16 OPEN

9/1 OPEN

11,000Net
Sales (million yen)
売上高（百万円）
9,000

5000

Ended of 1Q

7,403

運営面積（坪）Operation
Ares (tsubo)

6,500
Target of this year

4000

3,680

4,400

3000

7,000

3,000

3,400

5,000

Vision Center Grande Tokyo Hamamatsucho
Operation Area :1,456 tsubo

2,898

3,000

1,000

1,842

2000

9/17 OPEN

Vision Center Tokyo Toranomon
Operation Area: 697 tsubo

Operating area opening in Augustand September:
Total of 2,580 tsubo at three sites

Progress

1,162

29.3%

1,289

1,112

-1,0001000-3,0000-5,000

21/3期
FY2021/3

22/3期
FY2022/3

23/3期
FY2023/3

24/3期
FY2024/3

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

25/3期1Q
FY2025/3
1Q

21

Vision Center Yokohama Minatomirai
Operation Area: 427 tsubo

Operating area as of the end of 1Q:
Together with 7,403 tsubo,
Around 10,000 tsubo in total.
Expected to achieve the full-yeartarget ahead of schedule

Sun Frontier Fudousan Co., Ltd

Hotel and Tourism BusinessOccupancy Rates and Average Daily Rates
Demand recovery and our heart-warming services has grown our performance. Accelerating business growth byincreasing the number of operating rooms and improving service capabilities.
Trends inホテル運営事業等セグメント利益(左軸）Segment profit and number of hotel

Trends in occupancy
rate and average daily rate
稼働率・客室単価の推移
100.0%(yen)(million of yen)

20,000

4,000

ADR
ADR

(buildings)
Segment profit for hotel operation business (left axis)※1
ホテル運営事業等セグメント利益(左軸）

27

26

30

The
number of hotel (right axis)※
運営ホテル軒数(右軸)

OCC
OCC
3,000

76.5%
71.3%

80.0%

71.2%

16,000151719Target of this year

21

2,740
20

2,000

63.7%

Progress

31.8%
60.0%

12,000

43.1%
36.8%

871

40.0%

15,282

15,130

0

8,000

328
-370

0

-1,506

11,665-1,000

9,440
20.0%

10

2,234

1,000

8,322

-2,188

4,000

-10

6,320
-2,000

0.0%

0

20/3期
FY2020/3

21/3期 FY2022/3
22/3期 FY2023/3
23/3期
FY2021/3-3,000

FY2024/3
24/3期 25/3期1Q
FY2025/3
1Q

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

-20
FY2020/3
20/3期 FY2021/3
21/3期 FY2022/3
22/3期 FY2023/3
23/3期 FY2024/3
24/3期※1 The 27 hotels for the first quarter of the fiscal year ending March 2025 include
Oriental Hills Okinawa, which was acquired through M&A in July.

22

FY2025/3
25/3期
1Q

1Q

Sun Frontier Fudousan Co., Ltd

Hotel and Tourism Business

Expanding Hotel Business actively with Hotel
Development and M&A

Luxury Class
Sora Niwa Terrace Kyoto Bettei
Hiyori Ocean Resort Okinawa
Atami Hotel Project
HIYORI Hotel Karuizawa Spa & Resort
Seifutei
Oriental Hills Okinawa<Number of hotel rooms>

3,123 rooms

27 hotels

40 rooms

1 hotels

Planned

1,638 rooms

11 hotels

Total

4,801 rooms

39 hotels

In operation
Scheduled to open in
FY2025/3

Kyoto
Gojo

Sora Niwa Terrace Kyoto
SADO RESORT HOTEL AZUMASADO NATIONAL PARK OOSADO
Hakone Hotel PJ

Ishikari(on planning)(on planning)

Ishigaki-jimaMatsumotoTakayama
Kyoto

Inawashiro (M&A)

Shijo
Gojo（on planning)

Kashima

Kobe

Maihama(M&A)

Narita(on planning)

Koiwa

Shimonoseki
Tokoname

HakataOzumachi(on planning)

Kakogawa(on planning)

Kurashiki
Mizushima

102
52
72
110

HIYORI HOTEL MAIHAMAHIYORI HOTEL OSAKA NAMBA STATION
Tabino Hotel lit Matsumoto
Tabino Hotel lit Miyakojima・Villa Miyakojima
Spring Sunny Hotel Nagoya Tokoname Station
Tabino Hotel lit Sakata
Tabino Hotel lit Kawaguchiko
Tabino Hotel lit Ishigakijima
Tabino Hotel lit Akita Ekimae
Kyoto Shijo Hotel PJ
Kyoto Gojo Hotel PJ

Sado
Karuizawa

Onna-son,
Okinawa
Miyakojima※on planning※on planning※M&A※on planning

Upper Middle Class

Sakata (on planning)

Oriental Hills Okinawa(M&A)(As of August 2024)

Upper Class

Akita (on planning)

HIYORI STAY Kyoto Kamogawa
Planned to opened on Sep. 14 2024

32
203
150
85
11
14

Osaka

Namba
Dotonbori(M&A)
Shinsekai(M&A)
Suminoe(M&A)

Kawasaki

Hakone (on planning)
Atami (on planning)
Kawaguchiko(on planning)

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

23

80
224
176
115
194
174
130
200
216
16
40

※on planning※on planning※on planning※on planning※on planning※2024/9/14 OPEN

Economy Class
Tabino Hotel Hida Takayama
Tabino Hotel Kashima
Tabino Hotel Kurashiki Mizushima
Tabino Hotel Sado・live Sado
Tabino Hotel EXpress Narita
Tabino Hotel Ishikari
Tabino Hotel Kumamoto Ozu
Tabino Hotel Kakogawa
Joytel Hotel Namba Dotonbori
Joytel Hotel Shinsekai Sakaisujidori
Osaka Joy Hotel
Kobe Plaza Hotel
Kobe Plaza Hotel WestDONDEN Highland

80
194
155
129
100
175
210
172
53
103
229
107
120
12

※on planning※on planning※on planning

Budget ClassSKY HEART Hotel Keisei Koiwa Mae
SKY HEART Hotel Kawasaki
SKY HEART Hotel Hakata
SKY HEART Hotel Shimonoseki

105
200
157
104

Sun Frontier Fudousan Co., Ltd

Hotel and Tourism Business

Acquired ORIENTAL HILLS OKINAWA
Improve the service capabilities of the entire hotel group through the operation of luxuryclass hotels

Opened in 2006 in Onna-son,
Okinawa, one of the best
resorts in Okinawa.
Nestled on a small hill 30
meters above sea level
overlooking the East China Sea,
this all-suite villa consists of 14
cottage-type buildings.

Stock
Acquisition
dateJuly 23, 2024

Manag
ement
Facility

Oriental Hills Okinawa(Opened in June 2006)

Sun Frontier Hotel Management Inc.
100% investment79-1 Serakaki, Onna-son,Kunigami-gun, Okinawa

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

14 buildings

24

We have one of the largest private pools in Japan in all of ourbuildings. Our meals are prepared with local ingredients
carefully selected by our three expert chefs who specialize insushi, French cuisine and teppanyaki. We are the auberge thatoffers the best experiences to suit each guest’s preferences.

Sun Frontier Fudousan Co., Ltd

Hotel and Tourism Business

Sado Island's Gold Mine Registered as a World
Cultural Heritage Site
With the registration of Sado Gold Mine as a World Heritage Site, the number of tourists to Sado is expected
to increase. We will support tourism in Sado and contribute to regional prosperity through hotel operations
and transportation infrastructure projects.
UNESCO World Heritage Centre and Business of Sun Frontier Sado
Tabino Hotel live Sado

Donden Kogen Lodge
Tabino Hotel Sado

UNESCO World Heritage Centre

The symbol of Sado “Aikawa Gold and Silver Mine" isregistered as a World Cultural Heritage Site.

Port of Ryotsu

Aikawa Gold andSilver Mine

Sado Outdoor BaseSADO NATIONAL PARKHOTEL OOSADO

Source: Sado Tourism Association
Figures for 2024 are a forecast by Sado City.

UNESCO World Heritage Centre

As a result of the World Heritage registration, the number oftourists is expected to exceed pre-pandemic levels.
SADO RESORＴ HOTEL AZUMA
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

25

LE BLUE SADO SAWANE

Nishimikawa Placer
Gold MineSun Frontier Fudousan Co., Ltd

Medium-term Management Plan
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Road Map forthe next Medium-term Management Plan

Long-term vision
2035

Next Medium-termManagement Plan
FY2026/3 to FY2028/3

Extant Medium-termManagement Plan
FY2019/3 to FY2025/3

Utilize limited resources to fill the world with smiles andexcitement!
Becoming a corporate group that continues to challenge
the creation of future value.

Basic policy
Work to resolve social issues by promoting cooperationand diversification within core business, providing
manufacturing through clients' point of view and heartwarming services.

Basic policy
Providing “a place where people gather andcommunicate with each other, and create social
development and happiness for people”

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

27

Net sales

300 billion yen

Ordinary profit

60 billion yen

Net sales

135 billion yen

Ordinary profit

27 billion yen

Ordinary profit margin

20%

ROE

10% or more

Equity ratio

Around 45%

Net sales

100 billion yen

Ordinary profit

20 billion yen

Ordinary profit margin

20%

ROE

10% or more

Equity ratio

Around 50%

Sun Frontier Fudousan Co., Ltd

Long-term vision 2035

Utilize limited resources to fill the world with smiles and excitement!
Becoming a corporate group that continuing to challenge and create future value.

FY2035/3

Net Sales 300 billion yen
Ordinary Profit 60 billion yen

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

28

Sun Frontier Fudousan Co., Ltd

Basic Policy forthe next Medium-term Management Plan
Work for resolving social issues by promoting cooperation and diversification within corebusiness, providing manufacturing through clients' point of view and heart-warming services.

New Building
Development Business

Sales Brokerage and Leasing
Brokerage Business
Property Management Business
Building Maintenance BusinessSub-leases Business
Rent Guarantee Business

Replanning BusinessSpecified joint real estate
ventures

Stock type
Businesses

Flow type
Businesses

New York Apartments
Replanning Business

Rental Conference RoomBusiness
Vietnam Apartments
Development Business

Hotel Operation Business
Hotel Development
Business

Base of human resource

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

29

Sun Frontier Fudousan Co., Ltd

Quantitative Plan for the next Medium-term Management Plan
Continuing high profitability and growth even after achieving the current medium-term plan.
Invest more actively in business while maintaining financial discipline and develop business with highcapital efficiency.
FY2028/3 Plan
Net sales

135 billion yen

Ordinary profit

27 billion yen

Profit Plan

Management
indicator

Net
sales
売上高

20%

Ordinary profit margin
ROE

10% or more

Equity ratio

Around 45%

Ordinary
profit
経常利益

300 billion yen

135 billion yen
100 billion yen
60 billion yen

27 billion yen

20 billion yen

FY2025/3
25/3期
Forecast
予想

FY2028/3
28/3期
Target目標

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

FY2035/3
35/3期
Target目標

30

Sun Frontier Fudousan Co., LtdFocus points for the Next Medium-term Management
Plan
１Strengthening humanresource base•••Strengthen recruitment and training to enhance human recourse.
Cultivating human resources as leaders through education and expanding organizations through amoeba division.
Further evolve into a corporate group that attracts human resource with diversity and our values of altruism
regardless of age, sex, or nationality

Manufacturing through clients' point of view•

２
Manufacturing
through clients' pointof view and heartwarming services•

To develop new buildings, hotels, apartments in New York City, and condominiums in Viet Nam through utilizing thecreativity cultivated by clients’ point of view in Office Replanning and further strengthen.
Strengthening base of Construction Business through M&A.

Heart-warming services through clients' point of view•••

Working closely with building owners to improve long-term problem-solving ability.
Improving ability of responding to needs of tenants and service users with care and warmth.
Educate and create an organizational culture to provide heart-warming and enjoyable services that impress hotel
guestsCooperation and diversification within core business (flow-type business)•３
Cooperation anddiversification withincore business••

Development of New Construction Business that aims to maintain the long-term economic value of buildings
through the cooperation with Leasing Management, Property Management, and Construction department.
Promotion of small-lot real estate property (properties in Osaka and Nagoya in addition to the central Tokyo area)
Development of apartment replanning in New York and condominium in Vietnam.

Cooperation and diversification within core business (stock-type business)••••

Provide further variegate service for real estate to solve clients’ problems.
Increase branches in Tokyo, focus on sub-leases entrusted, and increase entrusted buildings for Property
Management.
Increase operating area in Rental Conference Room Business
Increase rooms of hotel operation （including M&A).

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

31

Sun Frontier Fudousan Co., LtdGrowth Strategies in the Next Medium-Term Management Plan
Diversify the use of real estate by combining development and services, and expand business domains and areas and accelerate growthThree markets
to focus

Businessmodel

Business domain

Area

Our goal

Tokyo

Contribute to the realization ofa sustainable society by
utilizing real estate in resource
recycling methods.

Renovation
Business domain expansion

Development

New construction
Area expansion

Sale of small-lot

OfficeTokyo(Act on Specified Joint Real Estate Ventures)Services

Real Estate Services

Operation

Rental conference rooms

Osaka, Nagoya
Tokyo

Tokyo

Area expansion

Osaka, Nagoya

Resolve our clients’ concerns
from their perspective, fortheir smile and excitement.

New construction
Development

Hotel

Renovation
Operation

Expand heartwarming and fun
hotels nationwide to grow withlocal communities.

Nationwide

Hotel operation
Area expansion

Business domain expansion

New construction

VietnamDevelopment

Residential
Services

Renovation

New York

Real Estate Services

Vietnam
New York

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

32

Tokyo

Provide high quality residential
environment full of safety,
security and comfort tocontribute to the developmentof nations.

Sun Frontier Fudousan Co., Ltd

Business Structure

Diversification of Flow-type Business and Expansionof Stock-type BusinessAs we expand our business areas,
we will diversify our flow-type businesses and increase the sales ratio of our stock-type businesses.
1600
FY2028/3 targets
Net sales
FY3 / 28 Plan
FY2025/3 1400
forecasts

Net sale
135 billion yen

135 billion yen
Growth Enhancement Properties Sales
Business

Net sales

1200
FY2025/3 forecasts

Net100sales billion

30 billion yen

yen
100 billion
yen
1000
20 billion yen

Flow-type
Businesses
65%

Continued Growth Properties Sales
Business800

Flow-type
Businesses
70%・ NY Apartment Replanning Business・ New Building Construction Business・ Specified Joint Real Estate Ventures

・ Replanning Business・ Hotel Development Business・ Apartment Development Business in Vietnam

600

57 billion yen
400

Growth Promotion Operation Business

50 billion yen
25 billion yen
Stock-type
Businesses
30%

14 billion yen200

Customer Expansion Real Estate Services
Business

16 billion yen

23 billion yen

0

25/3期
FY2025/3
forecast
予想

・ Hotel Management Business

26/3期
FY2026/3
plan
計画

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

27/3期
FY2027/3
plan
計画

Stock-type
Businesses
35%

・ Rental Conference Room Business・ Real Estate Service Business・ Construction Solutions Business

28/3期
FY2028/3
plan
計画

33

Sun Frontier Fudousan Co., Ltd

Business Strategy

Expanding the Business Base and Customer Base of
Stock-Type BusinessAccelerate growth of stock-type businesses and strengthen the stable earnings base of the Group as a whole
Number of hotel rooms(Tsubo)(Room)

6,000

Operating area of rental conference
rooms

20,00010,000

2,000
0

5
0

0
FY2024/3 FY2025/3

FY2028/3(Forecast)(Targets)

FY2024/3 FY2025/3

FY2028/3

FY2024/3 FY2025/3

FY2028/3(Forecast)(Targets)(Forecast)(Targets)

In addition to promoting business in the Tokyo
area, planning to expand business in the Kansaiarea

Promote development and M&A,
aiming for 10,000 rooms

Number of buildings managed underproperty management(Building)

600(Building)Number of buildings under contract for
maintenance

FY2028/3(Forecast)(Targets)

3,856

4,200

2,500

0

0
FY2024/3 FY2025/3

5,000

270

200

0

Number of rental guarantee contracts
in arrears(Cases)

5,000

239

250

Strengthening community-based branch network incentral Tokyo
Further improve our ability to solve customer
problems

400

400

500

13

10

6,500

5,000

493

12

10,000

3,200

540

16
15

15,0003,099

Number of leasing management
branches

16,000

6,000
4,000

(Store)FY2024/3 FY2025/3(Forecast)

FY2028/3(Targets)

Increase the number of entrusted buildings in central
Tokyo with the aim of increasing the number of entrusted
buildings to 1,000 by 2035

Aiming to “Make Tokyo the Most Beautiful City in theWorld,“ increase the number of entrusted buildings
for cleaning, sanitation and safety

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

34

FY2024/3 FY2025/3

FY2028/3(Forecast)(Targets)

Specializing in Rent Guarantee Business forcommercial buildings
Focusing on new acquisitions and contract growth

Sun Frontier Fudousan Co., Ltd

Allocation of funds

Aggressive Investment for Future Business Growth
Actively invest in growing fields while paying attention to the capital cost, focusing on the profitability and turnover of each business．
Total investment in the next Medium-term Management Plan (FY2026/3-FY2028/3): will be 310 billion yen【Cumulative capital income】 【Cumulative capital expenditure】

Short-term
Replanning

100 billion yen

Continue to actively invest in small and mediumsized buildings in the five central wards of Tokyo

Mid- to long-term
Replanning

50 billion yen

Invest in buildings that can be developed on arelatively large scale

New construction
development

30 billion yen

Expanding investment in New Construction Businesswith our cultivated technologies

Loans

NY Apartments
Replanning

20 billion yen

Increase investment to expand business in highgrowth markets

Cash and deposits

Small-lot real estate
properties

21 billion yen

Promotion of commercialization in Kansai and otherregions in addition to Tokyo

Hotel development

70 billion yen

Aggressively invest to increase the number ofoperating rooms to 10,000

Vietnam
Apartment
development

9 billion yen

Investment in Da Nang, where high growth potential
and housing demand are expected

Other
M&A

10 billion yen

Actively use to accelerate business growth andcreate synergies

Dividend

12 billion yen

Increase dividends in line with profit growth andreturn to shareholders

Business proceedsfrom sales etc. of
properties

322 billion
yen

Business growth
Investment

310 billion
yen
Return toshareholders* From FY3 / 25 to end-FY3 / 27, conversion of convertible bonds into shares is expected to progress at the end of each fiscal year, resulting in increased number of shares issued and outstanding.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

35

Sun Frontier Fudousan Co., Ltd

Philosophy and Business Initiatives
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Sun Frontier Philosophy

Company policy

Ｃｒｅｄo

COMPASSION
We believe in helping others, as many as we can,throughout our lives.

Management Philosophy

MissionFuture Image

VisionOur mission is to look after every employee and pursue thehappiness of both mind and matter. At the same time, to cocreate a rich and sustainable society by contributing to theevolution and the development of the human society.
Our vision is to become the most appreciated visionary
company that fully utilizes limited resources and continues
the challenges to create new values.
1. Work For Your colleagues

Course of Action

Value

2. Do The Right Thing
3. Absolute Proactiveness4. Do it immediately, do it definitely,
do it until success

5. Stay Humble, Thankful,
And Respectful
6. Always Work Creatively
7. Be GENBA-Centric
8. Be Open-Minded Cheerful
and Wonderful

The Value and the Course of Action shared by all employees, the Core of our
Corporate Culture
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

37

Sun Frontier Fudousan Co., Ltd

Sustainability Management
Sustainability Vision

The Group's sustainability website → https://www.sunfrt.co.jp/en/sustainability/

We will contribute to the realization of a sustainable society through our business activities, respecting the heart of altruism that is ourcompany policy.
Important
Challenges

Social issues to besolvedEnvironmental Protection

Small and mediumsized buildings thatcan still be used if
their value increases
are being demolished= Waste of resources

Regional Revitalization

Revitalization of theregional economy

Related
SDGs

Main Measures

Targets (KPIs)■Extension of healthspan of realestate・ Economic lifespan extended by 30% or more
・ Occupancy rate of buildings over 30 years old: 90% or more・ Continuation of management after the sale of replanning properties: 90% or more・ Reduce CO2 emissions by an average of 12% or more compared to building reconstruction
work
・ Carbon offset 100%
• Reduce greenhouse gas emissions by 22% from fiscal 2022 levels by 2030 and achieve carbon
neutrality by 2050■"Energy conservation" and"Reduction of environmental
impact“ through real estate
revitalization■ Create buildings, offices,and spaces that are motivating
and creative and contribute toeconomic growth・ Establish "Sun Frontier Wellness Score (SWO)," an in-house standard for the revitalization ofreal estate that takes well-being into consideration and increase the ratio of newly supplied
replanning properties that exceed SWO to at least 30% in fiscal 2023, 50% in fiscal2025 and 70%
in fiscal 2030.
・ Conduct tenant satisfaction survey (Company-owned properties)

Human Resource
Development

Response todevastating natural
disasters■ Disaster prevention andmitigation through regional
cooperation

・ Provide set-up offices with emergency supplies or installation space
At least five lots by fiscal 2023, and at least 20 lots by fiscal 2023
・ Posting disaster prevention information on a dedicated website: 100% in fiscal 2023
(Company-owned properties)

Decrease in theworking-age
population (decreasein the real labor
force) due to thedeclining birthrate
and aging population,and elimination of thegender gap■Respect for and utilization ofdiversity■ Create a workplace with
"Job satisfaction," "creativity"and “growth opportunities"• Increase the ratio of female managers to at least 12% by April 2025
・ Ratio of training hours to designated working hours: 12% or more・ Increase the amount of ordinary profit per hour compared to the previous year

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

38

Sun Frontier Fudousan Co., Ltd

Sun frontier’s Strength
Create a good corporate climate and culture based on the two wheels of Philosophy andAmoeba Management to realize our Management philosophy.
Realization of the Management philosophy
Corporate climate and culture
Management among all employees’ participation(1) Management based on the hearts of people (2) Culture that values challenges

Amoeba management *Philosophy(1) Realization of all-employee participatory
management(2) Development of human resources withmanagement awareness(3) Market-based divisional accounting system(1) The heart of altruism(2) Being right as a person(3) Absolute proactivity
By philosophy,
even as the Group's businesses diversify and various
employees work, it is possible to create a corporate
culture that transcends the boundaries of businesses
and enables each and every employee to connect witheach other across the organization and to co-create
ambitious goals.

What is Ameba Management?
A process in which all members of an organization
participate in management through the use of adivisional accounting system by functional small groups(ameba). Management status of each division can be
grasped even in the midst of business expansion* Amoeba management is the registered trademark of KYOCERA Corporation.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

39

Sun Frontier Fudousan Co., Ltd

Human Resource Development
Desired image of humanresources

Human resources with both "the heart of altruism" and "frontier spirit"

Human Resources Development Policy
Develop human resources who can develop new fields with a frontier spirit toward the realization of a sustainable
and affluent society together with colleagues who share values of altruism.
We aim to realize a society that can be passed down to future generations by fostering human resources who have the kindness
to care for others around them and the strength to maintain personal integrity, and boldly take on challenges in areas where they
have no experience. To this end, the pillars of our human assets are exploration, curiosity, self-motivation, autonomy, andrespect for and utilization of diversity.

Environmental Improvement Policy
Create a work environment that provides "job satisfaction," "creativity," and "growth opportunities." Create a "cocreation" organization in which all employees set their own goals, work toward those goals with enthusiasm, andcontinue to create new value based on mutual trust.

Human Resources
Development Policy

A corporate culture that encourages challenge and growth

Creativity

A corporate culture that envisions the future and aims to create new value

Growth opportunity

A corporate culture that stimulates the desire to learn and works toward high goals

Measures•

Respect for andutilization of diversity•

Environmental
Improvement Policy•

Creating a workplacewith motivation,
creativity, and growth
opportunities

Job satisfaction•

Key Points

Creation of a work environment suited to each
employee's life stage and provision of flexible
training opportunities
Cultivating Ameba leaders for businessdiversification and organizational expansion
Establish training programs for the next generation
leaders, improve support systems for external
training, and increase the ratio of training hours todesignated working hours to 12% or more.
Use of DX, improvement of business processes andindividual capabilities, and year-on-year increase inordinary profit per hour

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

40

Strengthening thehuman resource base
Manufacturingfrom the perspective ofcustomers
and heart-warming services
Promotion ofcore business tie-ups anddiversification

Basic Policies of thenext Medium-Term
Management Plan

Working to resolve
social issues bypromoting corebusiness tie-ups anddiversification throughcustomer-oriented
manufacturing andheart-warming services

Sun Frontier Fudousan Co., Ltd

Shareholders Return
Basic Policy for Shareholder Return①Strive to provide long-term and stable shareholder return②Secure investment funds for future growth③Maintain the stability of financial base

(yen)

100

140.0%

With the exception of keeping dividend in FY2021/3,
we increased dividend for 12 years.
Grow the business and increase cash dividend continuously.

120.0%

80

66.0

Cash dividends in 2Q end
中間※１

58.0

Cash dividends per share
期末

60

38.5

40

42.0 42.0 44.0

48.0
60.0%

33.5

30.0
25.0
13.5
14.0%

3.5

33.0

16.5

28.9%
20.0%

14.4%

40.0%

47.9%

8.5
12.8%

33.0
80.0%

Dividend payout ratio
配当性向※２20

100.0%

14.0%

21.3%

21.1%

19.2%

20.1%

23.6%

20.0%

22.9%

13.1%

0

0.0%
FY2012/3
12/3期 FY2013/3
13/3期 FY2014/3
14/3期 FY2015/3
15/3期 FY2016/3
16/3期 FY2017/3
17/3期 FY2018/3
18/3期 FY2019/3
19/3期 FY2020/3
20/3期 FY2021/3
21/3期 FY2022/3
22/3期 FY2023/3
23/3期 FY2024/3
24/3期 FY2025/3
25/3期 FY2026/3
26/3期 FY2027/3
27/3期 FY2028/3
28/3期(forecast)※1 Interim dividend started from FY2022/3※2 Dividends are anticipated in expectation of the progress of conversion of CB to stocks at the end of each period from FY25/3 to the end of FY27/3.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

41

Sun Frontier Fudousan Co., Ltd

Simulation of Balance Sheet
Expand total assets by investing more aggressively for future business growth while maintaining financial discipline(100 millions of yen)

4,000

Other assets
その他資産

Fixed assets
固定資産

Inventories
棚卸資産

Net assets *
純資産※

Other
その他負債

Interest-bearing
有利子負債

liabilities

Cash and deposits
現預金liabilities

3,000

3,200
380

2,200
2,000

1,410

420
950

1,000

2,350

290

170

1,380

1,500
1,080
400

330

0

FY3 (forecast)/ 25 e25/3期
FY2025/3

FY3 / 28e
28/3期
FY2028/3(forecast)
FY2028/3(forecast)

Equity ratio

Equity ratio48%

Around 45%* From FY2025/3 to end-FY2027/3, conversion of convertible bonds into shares is expected to progress at the end of each fiscal year.
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

42

Sun Frontier Fudousan Co., LtdTrends in Performance of Replanning Business andProperties Purchase●Trends in net sales, Segment profit and Segment margin(million yen)
Net
sales
売上高

80,000

32.4%

29.2%
31.2%

31.1%

31.0%

24.3%

28.7%

30.0%

Target of this year
63,000

Segment
セグメント
profit利益56,09660,00053,83420.0%

48,39547,99542,50740,00033,791

Target ofthis year

Profitセグメント
margin
利益率
20,00013,78817,52915,727

14,94318,90014,989

8,204

10.0%

8,021
2,301

0

0.0%

FY2019/3
19/3期

FY2020/3
20/3期

FY2022/3
22/3期

FY2021/3
21/3期

FY2023/3
23/3期

FY2024/3
24/3期●Trends in properties purchases

Target of this year

(million yen) 60,000

50,74840,00036,281

FY2025/3
1Q
25/3期1Q

55,00038,28632,860Progress

31.2%

27,60020,00017,153

15,0360
FY2019/3
19/3期

FY2020/3
20/3期

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

FY2021/3
21/3期

FY2022/3
22/3期

43

FY2023/3
23/3期

FY2024/3
24/3期

FY2025/3
1Q
25/3期1Q
Sun Frontier Fudousan Co., Ltd

Steady Growth in Real Estate Service Business
Stock Business continues to grow steadily as stable business. The profit in FY2025/3 is expected torecord a new high.
Trendsin Segment Profit and Rate of Profit in Real Estate Service Business
不動産サービス事業セグメント利益および利益率推移(million of yen)Sub-leases,
サブリース
Referal fee
紹介手数料他

10,000

60.0%

56.2%

55.3%

54.7%
52.7%

51.1%

Conference
貸会議室
Room
8,000

53.5%

54.4%

Target of this year

50.0%

6,300

Rent
滞納賃料
Guarantee
保証

5,612

6,000

4,890

Building
BM

Management

Property
PM

Management4,000

2,829

3,206

40.0%

3,803

3,490

Progress

26.9%

Leasing
賃貸仲介

Brokerage

1,696

2,000

30.0%

Sales
売買仲介
Brokerage
Segment
セグメント
profitmargin
利益率

20.0%

FY2019/3
19/3期

FY2020/3
20/3期

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

FY2021/3
21/3期

FY2022/3
22/3期

44

FY2023/3
23/3期

FY2024/3
24/3期

FY2025/3
1Q
25/3期1Q

Sun Frontier Fudousan Co., Ltd

Real Estate Service Business Continues to Expand
Its Customer Base
Expanding as a platform for business growth【Property Management entrusted property distribution】（棟）(buildings)

Trendsof the Number of Entrusted Buildings in
プロパティマネジメント管理受託棟数推移
Property Management Business

600

500
400
300

276

333

362

372

373

392

397

421

457

493

506

200
100
District0(cases)

FY2015/3
15/3期 FY2016/3
16/3期 FY2017/3
17/3期 FY2018/3
18/3期 FY2019/3
19/3期 FY2020/3
20/3期 FY2021/3
21/3期 FY2022/3
22/3期 FY2023/3
23/3期 FY2024/3
24/3期 FY2025/3
25/3期
1Q
1Q

滞納賃料保証契約件数の推移
Trendsof the Number of Rent Guarantee Contracts

4,000
3,000

2,035
2,000

1,290

2,370

2,658

2,989

3,099 3,261

P

Entrusted properties of the Company【Percentageof new contracts of Rent Guarantee by area】【滞納賃料保証 エリア別新規契約※件数割合】
3,563

3,856 3,927

Except for 23
wards 1%Others7%
Other 23 wards
13%

1,642

25%

■ Other Tokyo 14%

Shinjuku-ku

9%

1,000

Chuo-ku

19%

Shibuya-ku

12%0
FY2015/3
15/3期 FY2016/3
16/3期 FY2017/3
17/3期 FY2018/3
18/3期 FY2019/3
19/3期 FY2020/3
20/3期 FY2021/3
21/3期 FY2022/3
22/3期 FY2023/3
23/3期 FY2024/3
24/3期 FY2025/3
25/3期
1Q

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

■ 5 cities of central
Tokyo 79%

Chiyoda-ku

45

Total of 93% in Tokyo

Minato-ku
14%* As of March 31, 2024 : 701 new contracts

Sun Frontier Fudousan Co., Ltd

Strategy in Office Business
Solving client’s various problems, mainly in the five cities of central Tokyo.

12

NakanoRP

Arakawa
Arakawa
14

11

Toshima*As of the end of June 2024

Taito

BunkyoBunkyoLM

25
80

Shinjuku
Shinjuku
42

ChiyodaOf the total number of RP buildings,
488 buildings, 80% are in the five cities ofcentral Tokyo and adjacent cities.

139

PM

Community-based 12 branches
Ginza, Kanda, Nihonbashi, Kodemmacho, Kojimachi,
Shinjuku, Shibuya,Gotanda,Hamamatsucho,
Yokohama, Shimbashi, Ikebukuro

Of the 506 entrusted properties, over 80% arein the five cities of central Tokyo.
*As of the end of June 2024

Shibuya
11

Chuo
51

BM

MinatoOf the 270 buildings under comprehensive
management, 85% are in the five cities ofcentral Tokyo.
*As of the end of June 2024

Rent
Guarantee

MeguroOf the 8,054 cumulative new contracts signed,
90% are in the five cities of central Tokyo.
*As of the end of June 2024

8

Rental15 of the 14 sites are in the five cities ofConference central Tokyo.
Room*As of the end of June 2024. The rest of one is in Yokohama

ShinagawaShinagawa* The numbers on the columns in the map are
the cumulative number of RP buildings.
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

46

Sun Frontier Fudousan Co., Ltd

Strengths in Office BusinessWith in-house manufacturing from purchase, development, leasing to sales and consulting,
we solve various problems by getting client’s needs correctly.

① Real Estate Utilization
To be a partner for solving various problems from clients’ point of view

Fundraising
Consulting

Asset consulting

Rent guarantee

Construction
planning

Property
management

Leasing brokerage

Sales brokerage

Property
purchasing②
Real Estate
Revitalization
Building
development ofvalue chain
Property
sales

Clients
1. Real estate utilization: Get close to our clients and solve various problems. Capture the source of added value
from clients’ voices.
2. Real estate revitalization: Utilize the needs we earned and the know-how for improving the valuation to conduct
sales activities.
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

47

Sun Frontier Fudousan Co., Ltd

Business Model for Replanning Business
Renovating the office buildings with low occupancy and in need of large-scale repairs
into high-value-added properties demanded by society using “clients’ point of view.”

Low-occupancy
low-profit buildings
・ Aging degradation
・ Earthquake
resistance anxiety
・ Violation of legal
compliance, etc.

Creativity

Leasing

Design offices in clients'
point of view and carryout renovation and repair
work in pursuit of safety
and security.

A community-based sites
network keep the building inhigh occupancy and becomesthe closest contact point for
any kind of consultation.

High-occupancy
high-profit buildingssought by owners

Value-up

Purchasing

Rent Guarantee

Purchase of lowoccupancy and nonoccupancy buildings
using various routes andmethods.

Encourage tenants tomove into the building andguarantee stable income
for the owner in the eventof rent arrears.

Clients =Building owners

Sales

Management

Stay close to clients of asset
holders and meet needs
with high levels of difficulty
beyond expectation.

Provide high-quality
services, maintain highoccupancy rate, andstabilize building
revenues.

・ Asset management, inheritancemeasures, etc.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

48

・ Full occupancy
・ Improve
income andexpenditure
・ Stable income

Sun Frontier Fudousan Co., LtdReplanning Business

Set-up Office Share"Set-up Office" is a kind of office replanned by our Company. Unlike regular office interiors, there are reception andreception room, etc., in the office with highly designed interior. We also provide some equipment for rent or fixtures preinstalled.

◆Four benefits for tenant companies
Merit 1) Reduced burden on management
No need for unfamiliar tasks such as designing office interiors andselecting interior decorators, significantly reducing management’s
effort.

Merit 2) Immediately available after moving
Increase the net estimated internal useful life due to no work other than wirerelated work and moving, a significant reduction in the relocation period and ashorter construction period for interior finishing and restoration.

Merit 3) Reduced financial burden
Significant cost reduction for office interiors, etc., and no interior assets
recorded by tenants.

Merit 4) Employment, motivation and productivity improvement
Improve employment of human resources, employee motivation, and officeproductivity by the office interior that pursues a high level of design, focusing
on design, functionality, and various usage scenes.

The share of Set-up Office in 23 wards of Tokyo
Based面積ベース
on rental area

Based on the 数ベース
number of rental rooms

Other

40.5%

Sun Frontier
Fudousan

Other
42.2%

46.6%

Company A

Sun Frontier
Fudousan38.5%

Company A
Company B 11.5%
7.8%

Company B 8.7%
4.2%

Survey conducted in February 2024
Survey planning: Sun Frontier Fudousan Co., Ltd.
Survey conducted: H. M. Marketing Research

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

49

Sun Frontier Fudousan Co., LtdReplanning Business

Create both Customer Value and Social Value
Solving social issues through supporting our clients' business.
Supporting the business growth forbuilding owners and tenants throughour Replanning Business.

Comparisonof resource input over 50 years
50年間の資源投入量の比較（kg/㎡）

3,991（t-CO₂）

7,000

40.9%↓

4,000

Comparisonof CO₂ emissions over 50 years
50年間のＣＯ₂排出量の比較

6,399

=

19.1%↓

Utilizing the limited, keeping challenging
to create new value, and aiming tobecome the most appreciated visionary
company in the world.

3,000

2,357

2,000

5,179

1,000

5,000

0
Rebuilding
建替
New
bldg
新築

Clients’
value

6,000

Renovation
改修

Rebuilding
建替

Repair修繕

Renovation
改修

Comparisonof waste generation over 50 years
50年間の廃棄物発生量の比較（kg/㎡）

4,000

3,000

801

49.3%↓

800

2,000
600

406

400

Economic
value

Social
value

1,000

200
0

0
Rebuilding
建替

New
bldg
新築

Rebuilding
建替

Renovation
改修
Repair修繕

Renovation
改修

Standard
標準
Demolition
解体

Renovation
改修New
新築bldgRepair修繕

Renovation
改修

Maintenance
維持管理

Disposal
廃棄

Energyエネルギー<Assumptions and rationale> Assuming a 30-year-old office building of approximately 3,000 square meters, the environmental contribution over a 50-year period (the service life of SRC office buildings) was
estimated based on the Architectural Institute of Japan's LCA Tool (*).
・ Rebuilding: “In the case of rebuilding every 35 years” ・ Renovation: "Regeneration without destroying old buildings (long-life buildings)" ・ Standard: "Assuming a 30-year-old unrenovated building"*Architectural I "LCA Tool for Buildings Ver5.0 - Evaluation Tool for Global Warming, Resource Consumption and Waste Management”, estimated with the cooperation of Engineering Research Institute of Japan.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

50

Sun Frontier Fudousan Co., Ltd

Business Model of NY Apartment Replanning Business
Use high-quality technology to add value to apartments that are over 100 years old in the United States, where growth is high

The United States has a high growth rate and its population continues to grow. Manhattan in New York has
many jobs and high housing demand.
A 100-year-old brick apartment in Manhattan, New York・ Example ofconstruction

BeforeAfter

Replanning to a comfortable living space (Interior and furniture are a sample image)
Separate bathrooms and toilets
Installation of washlet toilets

BeforeAfter

Point 1Long-term stable assets can be held in New York, the world's largest city

Point 2High-quality building renovated and repaired by Sun Frontier

Point 3

Sun Frontier's buildings can be purchased after consideration.

Point 4

Sun Frontier will conduct both building management and lease operation after purchase.

Installation of a built-in kitchen

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51

Sun Frontier Fudousan Co., Ltd

Specified Joint Real Estate Ventures(Sale of Small-lot Real Estate Properties)
Realizing a form of real estate ownership that makes it easy to divide the estate to thesuccessor and makes asset management easy.
Features of the Compass Series

Scheme of the Compass series

Point

1

Sun Frontier Fudousan
Acquisition and commercialization of real estate for investment

Point

2
Voluntary partnership

ClientInvestment
Investors
contribute money
to form a
voluntary
partnership

ClientClientClientVoluntary
memberVoluntary
memberVoluntary
memberClient’sbank account

Point

3
Distribution

Managing partner
Sun Frontier Fudousan

Easy acquisition of prime real estatethat can be expected to operate stably
Easy and secure management andoperation by Sun Frontier Fudousan
Can be used as a measure against
asset division

Examples of Compass Series

Dividends paid
twice a year

Integrated management and operation of realestate by the managing partner

Rent

New licensed nursery schoolin Setagaya, Tokyo

New licensed nurseryschool in Ueno

New Medical and Educational
Mall in Ota-ku, Tokyo

New licensed nursery schoolin Takanodai, Nerima

Sale

TenantCopyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Real estate market

52

Sun Frontier Fudousan Co., Ltd

Hotel Development Business andHotel Management BusinessSelling the hotel we developed after operation
After the sale, the property is leased and managed, contributing to asset formation as aprofit-making property
Land

Land
Management
Sale

Purchase

Owner

Development

management

Construction

The Company

The Company

Sun Frontier
Hotel Management

Sun Frontier
Hotel Management

Sale

Purchase

The Company

Owner

Sun Frontier
Hotel Management

Lease
Contract

The Company
Sun Frontier
Hotel Management* In addition to the method of acquisition and development of the land, the optimal development method is selected according to the case, such as renting and leasing the land
and the building.

Examples of hotels under development and management

Hiyori Hotel Maihama
Opened in July 2017, sold andcurrently in operation

Hiyori Hotel Nanba Ekimae
Opened in May 2019,
currently in operation

HIYORI Ocean Resort Okinawa
Opened in February 2021, soldand currently in operation
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Tabino Hotel Kurashiki Mizushima
Opened in February 2020,
currently in operation

Tabino Hotel lit Miyakojima
Opened in June 2021,
currently in operation

53

Tabino Hotel Kashima
Opened in April 2020,
currently in operation

Tabino Hotel lit Matsumoto
Opened in July 2021,
currently in operation

Sora Niwa Terrace Kyoto
Sora Niwa Terrace Kyoto Bettei
Opened in June 2022,
currently in operation

Sun Frontier Fudousan Co., Ltd

Overseas Development Business

Vietnam HIYORI Aqua Tower PJ Starting
Second condominium project (202 units), construction scheduled to begin in August.
Project Overview
Location

Lot 3-A2-1, Son Tra-Dien Ngoc Complex Center, Tho Quang Ward
Son Tra District, Da Nang City, Vietnam

Area size

Land area 1,850㎡

Building
structure

Building area 1,062㎡

Reinforced concrete construction

Total floor
24,498㎡
area

25 floors with 2 basement floors

Facilities

202 residences, stores, kindergarten, swimming pool, fitness gym, community
room, car parking lot, motorcycle parking lot

Schedule

Construction start in August, completion in Autum 2026

Appearance perspective

HIYORI Garden Tower
Completed in December 2019306 houses sold2 blocks of stores
Interior perspective
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

54

Sun Frontier Fudousan Co., LtdTrends for Each Indicator and Initiatives for ROE
Improvement
Ordinary Profit Margin

Total Capital Turnover

Enhance added value in clients' pointof view and evolve and grow highly
profitable businesses.

Equity Ratio

× Increase efficiency by shortening
business period and increasing stockbusiness sales.
Ordinary
Profit
経常利益率
Margin

70.0%

60.0%

56.2%
52.3%

50.4%

52.2%

50.0%

52.2%
48.1%

× Maintain financial soundness
while promoting investment
and accelerating business.
Total
Capital
総資本回転率
Turnover＝Improving ROE

自己資本比率Equity Ratio

ROE
ROE

26/3期
FY2026/3

28/3期
FY2028/3

54.3%
50.1%
52.9%

49.7%

48.0%

46.8%

40.0%

48.0%

42.3%

30.0%
24.0%

22.0%

21.8%

20.0%

17.1%

16.8%

17.7%

20.0%

17.8%

12.6%

15.3%

10.0%

13.9%

14.6%

24/3期
FY2024/3

25/3期
FY2025/3

10.8%
6.5%
0.0%

19/3期
FY2019/3

20/3期
FY2020/3

21/3期
FY2021/3

22/3期
FY2022/3

23/3期
FY2023/3

27/3期
FY2027/3（Forecast)

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

55

Sun Frontier Fudousan Co., LtdImprove PBR by the initiatives for ROE Improvement

ROE (left axis)

ROE(左軸)

20.0%

16.8%

株主資本コスト(左軸)
Costof Equity (left axis)

PBR(右軸）PBR(right axis)（ ｔｉｍｅｓ）

20.0

17.7%
15.3%

13.9%

15.0%

14.6%

15.0

10.8%
10.0%

10.0
7.3%

7.3%

7.3%

7.3%

7.4%

7.4%

6.5%

5.0%

1.03

0.62

0.71

5.0

0.72

1.01

0.77

0.0%

0.0
FY2019/3
19/3期

FY2020/3
20/3期

FY2021/3
21/3期

FY2022/3
22/3期

FY2023/3
23/3期

FY2024/3
24/3期

FY2025/3
25/3期（Forecast)

FY2026/3
26/3期

FY2027/3
27/3期

FY2028/3
28/3期※Cost of Equity is calculated by Ｃａｐｉｔａｌ Ａｓｓｅｔ Ｍｏｄｅｌ. Cost of Equity will be around 7 to 8%.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

56

Sun Frontier Fudousan Co., Ltd

Driver to improve ROE
Keep employees in high engagement through Sun Frontier Philosophy and Ameoba Management. Promoting Businessby the style of “All join to Management”.

ROE

売上高
Net
Profitmargin
純利益率

Real
Estate
不動産
Revitalization
再生事業
Business

Continuation and maintenance of
高収益事業の維持継続
highly profitable businesses

Improvement of purchase ability

Sun Frontier Philosophy

Improvement of manufacturing
ability
Fulfill properties for sale
Shorteningof the business period
事業期間の短縮Enhancement of leasing ability
Site supervision and construction
schedule management

総資本
Total
asset
turnover
回転率

Real
Estate不動産
Services
サービス事業
Business

Increase ratio of stock business
利益率・資産効率の高い
with high profit margin and asset
ストックビジネス比率向上
efficiency

Enhancement proposal ability
Customer growthService Enhancements

自己資本
Financialleverage
比率

Capital
資本政策
policyGrowth into a highly profitable
高収益事業への成長
business

RevPAR Improvements

Developmentof high added value
高付加価値な開発

Expansion of manufacturing ability

Allocation of appropriate
適正な投資配分
investment

Aggressive investment in Business
Verification of post-investment
returns

Stableshareholder return
安定的な株主還元

Amoeba management

Hotel
and
ホテル・
Tourism
観光事業
Business*

Dividends based on profit growth* Amoeba management is the registered trademark of KYOCERA Corporation.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

57

Sun Frontier Fudousan Co., Ltd

Strengthening IR Activities
By expanding IR activities, we aim to make more conversation with capital market actively.
IR activities
Presentation of financial
results

Held every quarter by President Representative
Director, Seiichi Saito.

Website for on-demand broadcast (including Q&A)
https://www.sunfrt.co.jp/ir_info/ir_doc/on-demand.html

Individual IR meetings

Conducted individually as needed.
(mainly handled by IR staff).

22times in 1Q for FY2025 (FY2024/3: 68 times, FY2023/3: 61 times)

Property visit

Invite to our RP property (3 times in 1Q for FY2025/3) ※for analysts and institutional investors. (FY2024/3: 9 times)

Web sites for investors

FISCO: https://web.fisco.jp/platform/companies/0893400

Disclosed materials
Financial Results

Disclose Japanese and English version simultaneously.
Disclose Chinese version within a week after Japanese.

IR Presentation

Disclose Japanese, English version and Chinese version
simultaneously.

Website (IR Library)
Japanese: https://www.sunfrt.co.jp/ir_info/ir_doc/statement-of-accounts/
English: https://www.sunfrt.co.jp/en/ir_info/ir_doc/statement-of-accounts/
Chinese: https://www.sunfrt.co.jp/ch/ir_info/ir_doc/

Annual Securities Report

Disclose Japanese and English version.

Japanese: https://www.sunfrt.co.jp/ir_info/
English: https://www.sunfrt.co.jp/en/ir_info/ir_doc/annual_securities_report/

Notice of General
Meeting of Shareholders

Disclose Japanese and English version.

Japanese: https://www.sunfrt.co.jp/ir_info/annual_general_meeting/English: https://www.sunfrt.co.jp/en/ir_info/annual_general_meeting/Analyst Report

FISCO 、 Shared Research

Japanese: https://www.sunfrt.co.jp/ir_info/
English: https://www.sunfrt.co.jp/en/ir_info/

Shareholder benefit program
OutlineDiscount coupons for hotels operated by our group companies based on the number and period of shares held.

Details and facilities
available for use

Shareholder benefit program website
https://www.sunfrt.co.jp/ir_info/stockholder_benefit_plan/

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

58

Sun Frontier Fudousan Co., LtdReferences Materials
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Insight for Business Environment

Number of Corporations by Prefecture and Number of Office
Buildings in Tokyo's 23 wards
In Tokyo concentrated many companies, demand renovation and rebuilding suppressed waste of resources remains highin while small and medium-sized buildings continue to age.
Tokyo 23 cities with 9,410 buildings
都道府県別法人数
上位10都道府県
Top 10Prefectures in Numberof Corporations

Small-to-Medium-Sized Buildings(Total floor area: 300 to 5,000 tsubo)

8,644 buildings
東
Tokyo

京

大
Osaka

阪

愛
Aichi

知

119,564

千Chiba

107,704

Old Seismic Building Codes:
115 buildings (15%)

55
50
45

153,694

北 海 道
Hokkaido
葉60

Old Seismic Building Codes:
2,132 buildings (25%)

184,363130,108766 buildings

65

223,407

埼
玉
Saitama(Total floor area: Over 5,000 tsubo)

70575,234

神 奈 川Kanagawa

Large-sized Buildings

75

20 years old or more:
7,509 buildings(87%)

Age ofBuildings built for more than 20 years : buildings
478 buildings(62%)

40
35
30
25
20

兵
Hyogo

庫

94,013

福岡Fukuoka

83,562静岡Shizuoka

76,981

15
Buildings built for less than 20 years :1,135 buildings (13%)

Buildings built for less than 20 years :288 buildings (38%)

10
5
0

800
Source: Compiled by the Company based on the National Tax Agency‘s“Number of Corporations by Prefecture”.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

600

400

200

00

200

Number of buildings

400

600

800

Source : Created by us based on "Tokyo 23 cities Office Pyramid 2023 (based on the number ofbuildings)" (Xymax Real Estate Institute)

60

Sun Frontier Fudousan Co., Ltd

Insight for Business Environment

Transfer of Tokyo Area and Japanese Population
While the population of Japan is decreasing, the population of Tokyo is increasing as more people are moving into the Tokyo area.
(Thousand people)

Ratio of Tokyo population to Japanese population (estimate)

60(Thousand people)

50
40

160

Tokyo Area

17.0%

30
20
10

Population in Tokyo
Population of Japan
Population of Tokyo as a percentage of the population of Japan140
Osaka Area

15.0%

120
Nagoya Area

0

100

13.0%

-10

12.6%
80

-20
60

-30

9.5%

-40

9.8%

10.3%

10.6%

11.1%

11.4%

11.7%

11.9%

11.0%

9.0%

40
-50

Local Area

7.0%

20

-60

12

-70

13

13

14

14

14

14

14

13

0

5.0%

2000 2005 2010 2015 2020 2025 2030 2035 2040
Source: Compiled by the Company based on Tokyo Metropolitan
Government statistics - "Population of Tokyo (Estimate).”Source: Prepared by the Company based on Statistics Bureau, Ministry of Internal Affairs andCommunications, "Number of New Residents by Address Before and After"

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

61

Sun Frontier Fudousan Co., Ltd

Insight for Business Environment

Marketability in small-lot real estate property
Promote commercialization of small-lot real estate properties in major cities. Make proposals meeting needs of investors throughout Japan.
There are more than 12 million households nationwide ofpotential customers in small-lot real estate properties
Classification(Net Financial Assets Held byHouseholds)

Super wealthy individuals

105 trillion yen(90,000 households)

Wealthy individuals

259 trillion yen(1.395 million households)(500 million yen or more)(100 million yen or more
Less than 500 million yen)

Quasi wealthy
individuals(50 million yen or more)
Less than 100 million yen)

Upper mass individuals(30 million yen or more)
Less than 50 million yen)

258 trillion yen(3.254 million households)

23 wards of Tokyo

332 trillion yen(7.263 million households)
678 trillion yen

Mass population(Less than 30 million yen)More than
12 million
households(4,213.2 million households)
Source: Prepared by the Company based on Nomura
Research Institute "wealthy individuals Pyramid"

Small-lot real estate properties
・ Nursery school

・ Educational and medical malls
・ Commercial buildings
・ Office buildings
・ Land, etc.
Provide wide varieties of properties

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

NagoyaOsaka and Kobe

62

In addition to 23 wards of Tokyo, there arevarious candidate properties for small-lot
products in major cities and surrounding
areas such as Nagoya, Osaka and Kobe. We
could provide them meeting the needs ofinvestors nationwide
Sun Frontier Fudousan Co., Ltd

Recognition of the business environment

Overseas Markets (the U.S., Vietnam)
Supplying Japan's high-quality residential real estate in the United States (New York) and Vietnam (Danang), where
population growth and high growth rates continue
While the population of Japan is decreasing, the population of theUnited States continues to increase, and there is a high possibility ofcontinued housing demand.
(millions of people)

In contrast to Japan, where the growth rate is flat, the U.S. has avery high growth rate, has many jobs, and is expected to continue
to have a high demand for real estate.

Demographics (the U.S., Japan)
United States

Trends in GDP (the U.S., Japan)(billions of dollars)

400
Japan

30,000300

United StatesJapan

20,000200

10,000

100

0

0
1980

1985

1990

1995

2000

2005

2010

2015

2020

1980

2025

Da Nang is the third largest city in Vietnam. The population
exceeded 1 million in 2017 and has continued to increase sincethen, and high housing demand is expected in the future.
(thousands of people)

1985

1990

1995

2000

2005

2010

2015

2020

2025

Although the GDP of Vietnam is lower than that of Japan, the growthrate is higher than that of Japan, and Vietnam is considered to have ahigh potential for future.
Trends in GDP (Vietnam, Japan)(billions of dollars)

Population trends in Danang

1,500

VietnamVietnum

Japan

6,000
1,000
4,000
500

2,000

0

0
1980

1985

1990

1995

2000

2005

2010

2015

2020

2025

1980

1985

1990

1995

2000

2005

2010

2015

2020

Source: IMF World Economic Outlook database (prepared by the Company)

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

63

Sun Frontier Fudousan Co., Ltd

Recognition of the business environment

Demand recovery and growth potential
in the hotel market

The recovery in travel demand has been remarkable, and both the number of foreign visitors to Japan and their spending
are expected to further expand in the future.
(millions of people)

Trends in Domestic Travel Spending by
Japanese(trillion yen)

30

70

Trends in Number of Foreign Visitors to Japan andForeign Visitor Consumption
消費額
Spending

宿泊旅行
Overnight trip
日帰り旅行
One day trip

60

Number of foreign visitors
訪日外客数

60

160,000

25

20
20

21

21

22

22

50

21

18
17

120,000

40
31 32

15

29

30

10
10

200,000

25

24

9

80,00020
20
1340,000

5

10
4

4
0

0

0

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Source: Compiled by the Company based on the Japan Tourism Agency's Travel
and Tourism Consumption Trend Survey "Domestic Travel Spending of Japanese"

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

0
2014

2016

2018

2020

2022

2024

2026

2028

2030

Source: Compiled by the Company based on the JNTO Statistics on the Number of
Foreign Visitors to Japan and the government's targets for the number of foreign
visitors to Japan and the amount of consumption

64

Sun Frontier Fudousan Co., Ltd

ESG Data
Environment

SocialGovernance

Actual numberof RP buildings

Carbon Offset
Cumulative total 3,046t

Ratio of male and female employees
in managerial positions（people） ■Male ■Female

500

437 people

400
300
200

Total 488 buildings
RE100/Mori no Denki
Total 19 buildings 2,241ｔ

Capital and business alliance
Promoting the use ofelectricity storage systems

RP construction
42 buildings
805t

As of June 30, 2024

As of June 30, 2024

As of June 30, 2024

100

Target ratio of female（people） managers at least 12%100

96 people
278
People
63.6%

50

159
36.4%

0

0

87
90.6%
9 people
9.4%

Employee

管理職Management

Childcare leave

Human resource
development

Utilization rate 100%

Aim to over 12%

Transition to acompany with
Audit & Supervisory
Committee

Ratio of Outside
Officers 1/3 or more

As of June 30, 2022

Board of Directors
Audit &
Supervisory
Committee

Female Directors
1 out of 11External
36.4%

Full-time
63.6%

Nomination andCompensation
Committee (optional)
2 out of 4 outside officers

12.1%
Return to work
ratio 100%

Full-time Full-time

Capital and business alliance
Promoting agrivoltaics

Acquired BELS for
9 properties

Training 12.1% ofworking hours

From childcare leave,
100% return to work

※As of March 31, 2024

Ensuring transparency
and soundness

・ RE100 ・ ・ ・ ・ Carbon offset using J-credit derived from renewable energy. Initiatives to become thefirst in Japan to introduce this system on each floor. Achieve zero Co2 emissions per tenant company.
・ "Mori no Denki" ・ ・ ・ Carbon offset using J-credit derived from forests. We can feel that we aresupporting forests side-by-side and moving into the building will contribute to the environment.

Sustainability website
https://www.sunfrt.co.jp/en/sustainability/
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Outside Outside■ Male ■ Female

65

Sun Frontier Fudousan Co., Ltd

Conversion conditions of CB
Type

Convertible bonds withshare acquisition rights

Maturity

Issuance date

October 6, 2023

Convertible
periodAmount offunds acquired

Approximately 10 billion yen

Bond interest
rate

5 years after the payment due date
However, In principle, non-convertible for 1 year
after the payment due date

1,554 yen per share
In principle, convertible (exercisable) only when exceeding

Conversion
price

0%

5 years

120% (1,865 yen)of the conversion price (exercise price)
However, this shall not apply to cases such as any
conversion (exercise) after the end of the business alliance

Specific use of funds

AmountAcquisition of land in conjunction withnew hotel development and construction
work investment

Approx. 8 billionyen

M&A funds primarily for the hotel
development business and construction
business

Approx. 2 billion
yen

period.
Issuance
2023/10After 1 year
2024/10After 2 years
2025/10After 3 years
2026/10After 4 years
2027/10After 5 years
2028/10

Possibility転換による株式数の増加の可能性
of Share Increasing due to the Conversion
上場株式
Outstanding
shares60,000,000

転換株式
Conversion shares

55,190,454

Business alliance
50,000,000

Maximum
13.2%
increase

40,000,000

Conversion of CBwith shareacquisition rights

Non-exercisable
in principle

In principle, convertible (exercisable) only when exceeding
120% of the conversion price (exercise price)
However, this shall not apply to cases such as any
conversion (exercise) after the end of the businessalliance period.

6,434,954

48,755,500

30,000,000
48,755,500

48,755,500

転換前
Beforeconversion

After 転換後
conversion

20,000,000

Dilution
will not occur.

If the AA fund sells shares on the market afterconverting convertible bonds into shares, it cannot
sell more than 25 percent of the total daily volume.
AA is prohibited from transferring the converted
shares to any of our competitors or activists.

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

66

10,000,000
0Sun Frontier Fudousan Co., Ltd

History of Sun Frontier Group

2,400(million of yen)(people)100,000

Net sales
売上高100,000

60,0002,000

経常利益
Ordinary profit

1,600

従業員数
Number of employees(including
part-timers and temporary workers)
パート・アルバイト含む

1,200

800

20,000400
20,0000-20,000

-400

'00/3

'05/3

Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

'10/3

'15/3

67

'20/3

'25/3
(forecast)

Sun Frontier Fudousan Co., Ltd

Company Profile
Company Name

Sun Frontier Fudosan Co., Ltd.

Location of Head Quarters 1-2-2, Yurakucho, Chiyoda-ku, Tokyo
Date of Foundation

April 8, 1999

Date of Listing

February 26, 2007 (First Section of Tokyo Stock Exchange)

Capital Stock *11,965 millions yen

Representative

Tomoaki Horiguchi, Chairman Representative Director
Seiichi Saito, President Representative Director

Number of Consolidated
Employees *Average Age of
Employees*

837 employees (1,636 including part-timers and temporary workers)
35.6 years old
Real Estate Revitalization

Business Profile

Management, Brokerage, Construction Planning, Rent Guarantee,
Real Estate Service Properties
Rental Conference Room, Building Operations, Asset Consultation

Hotel Development and Operation
Others

Accounting Month
Listed Market

March
Tokyo Stock Exchange Prime (Code number: 8934)* As of the end of June 2024
Copyright © 2024 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

68

Sun Frontier Fudousan Co., Ltd

Sun Frontier Fudousan Co., Ltd

Thank you for your continued support.
◆ The purpose of this document is to provide information that can be used as a reference, not for soliciting or promoting you

to purchase a specific product. Please make your decision by your own discretion and responsibility when you make an
investment. If you want to purchase shares of our Company, please contact securities companies.
◆ The information provided in this document is not necessarily in compliance with the Financial Instruments and ExchangeAct, the Building Lots and Buildings Transaction Business Act, the Listing Rules for the Tokyo Stock Exchange and otherrelated laws and regulations.
◆ Forward-looking statements included in this document do not guarantee future performance.
◆ Although we have made every effort to ensure the contents of this document, we can not guarantee their accuracy or
certainty. Please note that they are subject to change or removal without notice.

<Inquiries about this document>
Sun Frontier Fudousan Co., Ltd. IR Desk
Phone : +81-3-5521-1551
URL : https://www.sunfrt.co.jp/
Mail : ir-contact@sunfrt.co.jp