Financial Results for the Second Quarter of
Fiscal year ending March 31, 2023

1) Overview of the 2Q Results for FY ending March 2023

1-92) Business Environment Awareness and Business
Performance

10-143) Business Progress and Initiatives

15-244) Management Principle, ESG

25-285) Business Model

29-366) Medium-term Management Plan

37-39

7) Reference Materials

40-46

November 10, 2022
Securities Code : 8934

Overview of the 2Q Results for FY
ending March 2023
Strong Performance in Real Estate Revitalization Business and Real Estate Service Business.
Hotel and Tourism Business is in recovery.
(Unit: million yen)
ProfitmarginYear-on-year

Growthrate

Full-year
Forecast

Progressrate

35,333―-9,992-22.0%

84,000

42.1%

8,044

22.8%

-1,356-14.4%

13,300

60.5%

8,035

22.7%

-1,250-13.5%

12,800

62.8%

5,368

15.2%

-493

-8.4%

8,300

64.7%

Results

Net Sales
Operating
ProfitOrdinary
ProfitProfit **”Profit” represents profit attributable to owners of parent.

Performance Highlights
2) Real Estate Service Business is steady, and Hotel and Tourism
Business is up

1) Replanning Business remained strong and drove performance• While restrictions on economic and social activities were eased, theReal Estate Service Business responded flexibly to changes and grewsteadily in all areas including brokerage, management, rent
guarantee, and rental conference room. High growth rates in net
sales (+ 15.6% YoY) and profits (+ 19.8% YoY).
• Despite the 7th wave of the pandemic of COVID-19, unrestrictedmovement has returned, and the performance of hotel operation in
the Hotel and Tourism Business has recovered. Losses have decreased
compared to the same period of the previous year.

• In the Replanning Business, the number of units sold was 14 (14 units
in the same period of the previous year) as planned. Both net sales
and gross profit saw year-on-year declines due to the sale of threeproperties owned over the medium- to long-term in the first quarterof the previous year. However, profit margin increased compared tothe same period of the previous year and results were solid.
• Although the vacancy rates in central Tokyo office are flat, rents areon a gradual downward trend. However, the real estate market
remains active. We continue to sell properties with high added value
in high profit margin.
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1

Consolidated Income Statement(Unit: million yen)
FY ended
March 2022
Apr - Sep

FY endingMarch 2023
Apr - Sep

Income Statement Points

Year-on-year Composition
ChangeRatio

Net Sales

45,32635,333-22.0%

100.0%

Real Estate Revitalization Business

37,472

26,255-29.9%

73.3%

Replanning Business

36,40425,255-30.6%

70.6%

Rental Buildings Business

1,067

1,000

-6.3%

2.8%

Real Estate Service Business

3,777

4,367

15.6%

12.2%

Hotel and Tourism Business

3,300

4,553

37.9%

12.7%

Other Business

1,050

620

-40.9%

1.7%

Adjustments

-275

-463

-

-

Gross Profit (Loss)

12,988

11,798-9.2%

100.0%

Real Estate Revitalization Business

11,5199,618-16.5%

78.3%

Replanning Business

11,222

9,391-16.3%

76.4%

296

226

-23.6%

1.8%

Real Estate Service Business

2,138

2,557

19.6%

20.8%

Hotel and Tourism Business

-646

-203

-

-

Other Business

117

110

-5.5%

0.9%

Adjustments

-140

-284

-

-

3,587

3,753

4.6%

9,400

8,044

-14.4%

Non-operating Income

161

271

68.3%

Non-operating Expenses

276

281

1.8%

Ordinary Profit (Loss)

9,285

8,035

-13.5%

Profit

5,862

5,368

-8.4%

Ordinary Profit Margin

20.5%

22.7%

Rental Buildings and Sub-leases

Selling, General and
Administrative Expenses
Operating Profit (Loss)

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<Real Estate Revitalization Business>
14 properties were sold at high profit margin (including
one in New York), the same number as the same periodof the previous year although the size of the property is
not larger than the previous year. The formation of smalllot real estate is also progressing steadily.

<Real Estate Service Business>
Brokerage is doing well, partly due to strong real estate
investment by foreign investors. Demand in the
Conference Room Rental Business is recovering thanks
to increased flow of people, and the Company isfocusing on opening new sites. Various services showedsolid performance growth.
<Hotel and Tourism Business>
With the lifting of social behavior restrictions, occupancy
rate and unit prices started to rise in increased flow ofpeople, reducing losses compared to the previous year.
Hotel sale planned for the third quarter.
・ Non-operating income was mainly due to foreign exchange gains.

2Consolidated Balance Sheet - Assets <Cash and deposits> Increased 6 billion yen due to realization of cash, mainly from sale of RP properties.
<Inventories>

Sales in RP properties exceeded those in purchase, resulting in a decrease of 1 billion yen.

<Non-current assets> Decreased 3.6 billion yen due to the reclassification of part of property plant and equipment to inventory.

(Unit: million yen)

As of End of
March 2021

As of End of
March 2022

As of End of
September 2022

Increase/Decrease(compared to the end of
March 2022)

110,785
21,50886,087110,92030,05377,340117,625
36,09377,153+6,704+6,040-186

Breakdown) RP
Hotel
Overseas, etc.

71,34813,916821

63,424
13,516399

62,347
13,867938-1,077+351+538

Other current assets

Non-current assets

3,189
16,7003,527
25,591

4,377
22,056+849-3,534

Property plant and equipment

10,52818,79615,142-3,653

701

572

658

+86

5,470

6,222

6,255

+32

127,485

136,512

139,681+3,169Current assets
Cash and deposits
Inventory assets

Intangible assets
Investments and other assets

Total assets

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3

Consolidated Balance Sheet- Liabilities/Equity <Interest-bearing debt> Decreased 2.4 billion yen due to repayment for sale of property
exceeding borrowing for purchase.
Interest-bearing debt balance: 48.6 billion yen.

<Net assets>

Increased 4.7 billion yen due mainly to profit (5.4 billion yen),etc. despite the payment of dividends (-1.1 billion yen).

(Unit: million yen)

As of End of
March 2021

As of End of
March 2022

Total net assets

13,358
5,530
901
6,926
44,354
41,991
2,363
57,712
66,916
2,856
69,773

16,210
6,904
3,528
5,777
45,84944,1691,680
62,06071,2603,191
74,452

Total liabilities and net assets

127,485

136,512Current liabilities
Short-term borrowings, etc.
Income taxes payable, etc.
Other current liabilities

Non-current liabilities
Long-term borrowings and bonds payable
Other noncurrent liabilities

Total liabilities
Shareholders' equity
Other

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4

Changes of Equity Ratio
End of March
2021

End of March2022

End of
September 2022

52.3%

52.2%

54.3%

As of End of
September 2022

15,194
5,241
2,802
7,150
45,324
43,413
1,910
60,51875,394
3,768
79,162
139,681

Increase/Decrease(compared to the End
of March 2022)-1,015-1,663-726+1,373
-525
-756
+230
-1,541+4,133+576+4,710+3,169

Operating Results by Business Segment

Real Estate Revitalization Business (Replanning and Rental building)<Replanning Business> Number of sales was 14. The same number of properties was sold as in
the same period of the previous year. The formation of small-lot products (million yen)is also progressing steadily. Sales and profits declined year-on-year, but
40,000segment profit margin was up 5.2% pt year-on-year to 35.0%.
 Average business period was 549 days (down 122 days year-on-year). The
business period of the properties sold in the current fiscal year has beenshortened due to a reaction to the sale of properties over the medium- tolong-term in the same period last year. We are focusing on leasing andcontinuing our efforts to shorten the operating period.
30,000(Unit: million yen)

FY ended
March 2022
Apr - Sep

FY endingMarch 2023
Apr - Sep

Increase/
Decrease

Net Sales

37,472

26,255-29.9%

Replanning Business

36,40425,255

30.6%

Rental Building Business

1,067

1,000

6.3%

Segment Profit (Note 1)

11,138

9,181

17.6%

Replanning Business

10,842

8,954

17.4%

296

226

23.6%

Profit Margin

29.7%

35.0%

+5.2%pt

Replanning Business

29.8%

35.5%

+5.7%pt

Rental Building Business

27.8%

22.6%

5.1%ptNumber of properties sold14 cases

14 cases+0 cases

Number of stocks at the end of FY

49 (Note 2)

48 (Note 2)-1 cases

Rental Building Business

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5

Net Sales
Segment Profit
Profit Margin

50%

37,472

40%
35.0%
29.7%

26,25530%

20,00020%
11,13810,000

0

9,181
10%

FY ended March 2022
Apr - Sep

FY ending March 2023
Apr - Sep0%

(Note 1) "Segment profit" is calculated by deducting specific costs of eachsegment, including interest expenses, sales commission and amortization of
goodwill from gross profit.
(Note 2) Projects of land purchase and development are included.

Operating Results by Business Segment

Real Estate Revitalization Business (Progress of purchase)<Purchase of RP properties>

FY ended
March 2022
Apr - Sep

FY endingMarch 2023
Apr - Sep

Increase/
Decrease

11 cases

15 cases+4 cases(of which, contracted and unsettled)

0 cases

4 cases+4 cases

Purchase amount

15,94024,820+8,880015,840+15,840

Purchase of RP properties was 24.8 billion yen(Unit: million yen)(including contracted and unsettled properties), up 8.8
billion yen from the previous period.
We are continuing to strengthen purchase activities
toward the level prior to the pandemic of COVID-19.
(million yen)

40,00036,82235,753

Number of items purchased(of which, contracted and unsettled)

36,46630,00025,180

As of end of
2Q
FY2023/3(15 cases)

As of end of 2Q
FY 2020/3

20,00024,220

As of end of 2Q
FY2018/3

19,07415,036

As of end of 2Q
FY2019/3

24,820

As of end of 2Q
FY2022/3
15,940(11 cases)

18,145

10,000
As of end of 2Q
FY2021/3

6,520

'18/3

'19/3

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'20/3

'21/3

6

'22/3

'23/3 2Q

Note) Including non-current assets

Operating Results by Business Segment

Real Estate Service Business(Property Management, Building Maintenance, Sales Brokerage, Leasing Brokerage, Rental Conference Room, Rent Guarantee, etc.)<Property Management/Building Maintenance>
 Sales and profits increased in the PM business due to an increase in the(million yen)number of entrusted buildings.
 While the BM business was flat in net sales, the profits increased due to an 5,000
improved profit margin.
<Brokerage>
 Sales and profits increased in Sales Brokerage due to the steady conclusion
4,000
of projects introduced by other divisions. Sales Brokerage for overseas(Taiwan) clients by group companies also contributed to earnings.
 Sales and profits in Leasing Brokerage increased due to market recovery.
<Rental Conference Room>
3,000
 Demand recovered and both ales and profits increased due toimprovement in occupancy rate and large-scale projects, although there
was a temporary increase in expenses due to the opening of a new site.
<Rent Guarantee>
2,000 Sales and profits increased due to an increase in the number of newcontracts compared to the previous year.

(Unit: million yen)

FY ended
March 2022
Apr - Sep

FY endingMarch 2023
Apr - Sep

Increase/
Decrease

Net Sales

3,777

4,367

+15.6%

Segment Profit

2,130

2,551

+19.8%

Profit Margin

56.4%

58.4%

+2.0%pt

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7

Net Sales
Segment Profit
Profit Margin

100%
4,367

3,777

56.4%

80%
58.4%
2,551

60%

2,130
40%

1,000

20%

0

0%

FY ended March 2022 FY ending March 2023
Apr - Sep
Apr - Sep

(Note) "Segment profit" is calculated by deducting specific costs of each segment,
including interest expenses, sales commission and amortization of goodwill fromgross profit.

Operating Results by Business Segment

Hotel and Tourism Business (Hotel Development, Hotel Operation, etc.)<Hotel Development Business>
 Sales decreased due to a reaction from the sale of 43 HIYORI OCEAN(million yen)
RESORT OKINAWA lots in the previous year. The sale of hotel
properties planned for the current fiscal year has been completed at
5,000
the end of October and will be recorded in 3rd quarter (alreadyincluded in Full-year Forecast).
<Hotel Operation Business> Due to the relaxation of restrictions, demand for domestic tourism
has been recovering. Compared with the same period of the previous
year, sales have increased and loss has decreased.
FY endingMarch 2023
Apr - Sep

Increase/
Decrease

3,300

4,553

+37.9%

Hotel Development Business

1,398

0

Hotel Operation Business, etc.

1,902

4,553

+139.3%

Segment Profit

-970

-334

-

Hotel Development Business

207

-61

-

Hotel Operation Business, etc.

-1,177-273-

Net Sales--

Hotel Development Business

14.8％

-

-

Hotel Operation Business, etc.

-

-

-

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8

4,553

30%

4,000

3,300

20%

3,000

10%

-

Profit Margin

Segment Profit

2,000

FY ended
March 2022
Apr - Sep

(Unit: million yean)

Net Sales

1,000
0-1,000-2,000

▲ 334

0%

▲ 970
FY ended March 2022
Apr - Sep

FY ending March 2023
Apr - Sep

-10%(Note) “Segment Profit” is calculated by deducting specific costs of each segment, includinginterest expenses, sales commission and amortization of goodwill from gross profit.

Operating Results by Business Segment

Other Business (Construction Business, Overseas Development Business, etc.)<Construction Business> While sales decreased due to a decline in the number of
construction projects in the industry, the profit margin improved
as some group companies completed amortization of goodwill at
the end of the previous fiscal year.
<Overseas Development Business>
 Sales decreased due to the sale of properties in both Vietnam andIndonesia in the same period of the previous year. Profits
increased in Vietnam due to condominium management.

(million yen)

1,200

Net Sales
Segment Profit
Profit Margin

1,050
1,000
800

20%
620

600

(Unit: million yen)

Net Sales
Segment Profit
Profit Margin

FY ended
March 2022
Apr - Sep

1,050
86
8.3%

FY endingMarch 2023
Apr - Sep

620
86
14.0%

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Increase/
Decrease

400-40.9%

200+0.2%+5.8%pt

9

30%

8.3%

86
0

14.0%

FY ended March 2022
Apr - Sep

10%

86
FY ending March 2023
Apr - Sep0%

(Note 1) "Segment Profit" means gross profit to interest expenses, sales commission
calculated by deducting specific expenses such as goodwill amortization.

Business Environment AwarenessandBusiness Performance

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10

Business Environment Awareness1. Global economy is increasingly concerned about a slowdown due to inflation and interest rate hikes in various
countries and slowing growth in China.
 The IMF predicts that global economic growth will slow from 6.0 % in 2021 to 3.2 % in 2022 and 2.7 % in 2023.
 In the United States, where inflation has not subsided, the Federal Reserve continues to raise interest rates, and arecession from next year is expected.
2. Prices are rising in the Japanese economy due to the weak yen and soaring resource prices. Both infection prevention
and economic revitalization are expected.
 While many countries raise interest rates to curb inflation, the Bank of Japan continues to ease monetary policy andyen continues to weaken due to interest rate differences with other countries.
 With the number of people infected with COVID-19 on the decline, social and economic activities are expected tobe revitalized by the easing of restrictions of movement.
3. In the central Tokyo office building market, hybrid work styles are spreading and roles required of offices are
becoming more sophisticated.
 Vacancy rate of central Tokyo offices remains flat. While rents are gradually decreasing, many new buildings will becompleted in the next fiscal year.
 While foreign investment in Japanese real estate is positively affected by the weak yen, rising interest rates need to
be watched.
4. Business environment in Hotel and Tourism Business is improving due to easing of restrictions following the decline in
the number of COVID-19 cases.
 Although demand is on a recovery trend as restrictions are eased in the seventh wave of COVID-19, we need towatch out for the eighth wave.
 As the number of infected people decreases, demand is expected to recover through nationwide travel support andincrease in the number of visitors to Japan due to the easing of immigration restrictions.
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11

Progress against Forecast for Fiscal Yearending March 31, 2023
Steady progress in the Real Estate Revitalization Business and the Real Estate Service Business.
In the Hotel and Tourism Business, hotel operation is recovering. Hotel sale to be recorded in 3Q.
(Unit: million yen)

FY ending March 2023
Earnings Forecast

FY ending March 2023
2Q Results

Progress Rate

Net sales

84,00035,33342.1%(1) Real Estate Revitalization Business

56,70026,255(2) Real Estate Service Business(3) Hotel and Tourism Business(4) Others
Adjustments

7,300
18,600
1,900
-500

4,367
4,553
620
-463

46.3%
46.2%
50.0%
59.8%
24.5%
32.6%
-

Gross profit

22,00011,79853.6%(1) Real Estate Revitalization Business

16,0009,618(2) Real Estate Service Business(3) Hotel and Tourism Business(4) Others
Adjustments

3,900
1,800
300

2,557
-203
110

-284

60.1%
60.6%
45.2%
65.6%
36.7%
-

Selling general and administrative expenses

8,700

3,753

43.1%

Operating profit

13,300

8,044

60.5%

Ordinary profit

12,800

8,035

62.8%

8,300

5,368

64.7%

170.76 yen

110.44 yen

64.7%

Replanning
Rental Buildings

Replanning
Rental Buildings

ProfitEPS (profit per share)
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54,7002,000

15,500500

01225,255
1,000

9,391
226

Changes in Ordinary Profit over the Last
Five Years
Strong sales in RP properties and steady growth in the Service Business.
（million yen）

20,000

1Q

2Q

3Q

4Q

16,127
15,00010,755
10,00012,813

2,830

1,067

2,255

232

3,002

1,284

2,698

12,215
7,524

3,561
1,853

Hotel sales scheduled for September will besettled in October.

5,000

2,008

8,035

7,277

6,690

'22/3

'23/3 （Forecast）

1,345

9,758
3,325

3,432
4,747

0

12,8002Q YTD

962
1,178

3,997

Initialforecast

2,016
'18/3

1,952
'19/3

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'20/3

13

'21/3

Shareholder Return (Interim Dividends)
Basic policy for the profit returns to shareholders
1. Strive to provide long-term and stable profit returns to shareholders
2. Secure investment funds to aggressively take on challenges for future growth
3. Maintain the stability of financial baseTrends in Net Profit per Share and Dividends per Share
1株当たり配当金
Dividends per Share
Net Profit per Share
1株当たり当期純利益

50円
38.50 yen

42.00 yen

42.00 yen

44.00 yen
Year-end
dividend
23.00 yen219.03 yen

180.35 yen

152.26 yen

46.00 yen (Forecast)

200円
170.67yen
170.76yen(Forecast)

100円
87.77 yen

0円‘'19/1
19/3

'20/1
‘20/3

'21/1
‘21/3

Interimdividend
21.00 yen

'22/1
‘22/3

Interimdividend

23.00 Yen

'23/1
‘23/3

* Interim dividend from FY ended
March 2022

Effective Date of Interim Dividends: Tuesday, December 6, 2022
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140円

Business Progress and Initiatives

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15

Replanning Business, Examples of Initiatives (1)Value-added office chosen by start-ups seeking a hybrid work style

Each floor has a reception with soft colors and a large lounge.

Entrance equipped with an information board that allows
users to check the security status (office presence orabsence) of the destination floor

Multiple installations ofteleconference booths to focus on
online meetings on each floor

Office with high ceilings and a sense of openness[Building appearance (after replanning)]

Ichibancho, Chiyoda-ku, Tokyo
One building profit building
Deck roof, steel-framed reinforced concrete,
7 stories high with 1 basement

A building that was constructed and used as a company-owned building before
increasing value→ Reception and lounge on each floor with multiple teleconference booths.
→ Many start-up venture companies seeking a hybrid work style have moved in.
⇒ Sold as a high-occupancy building and entrusted with management after sale.

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16

Purchase
Management

RP
Leasing

Sale Warranty

Replanning Business, Examples of Initiatives (2)Value-added building with high design and liquidity in compliance with the Building Standards Law
BeforeAfter

Two-wayevacuation is notsecured

Safe office withsecured two-way
evacuation

EV

EV

Balcony

Balcony

Some floors did not ensure "two-way evacuation" as requiredby the Building Standards Law, but this has been corrected
and the building has increased in value as a highly liquidbuilding suitable for compliance with laws and regulations.

Lounge with warm lighting

Versatile Sofa Booth[Building appearance (after replanning)]
Kanda Sarugakucho, Chiyoda-ku, Tokyo
One building profit building
Steel-framed reinforced concrete andreinforced concrete structure
Deck roof, 7 stories

Wide and safe office space

Entrance with distinctive illumination

Interior with illumination that makes the most of the brick-like appearance.
Increased the value to a safe and secure office building compliant with the BuildingStandards Law.
→ Companies with many visitors move in in search of a well-designed office.
⇒ Entrusted management after sale and contribute to the operation of the building
for the buyer.

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17

Purchase
Management

RP
Leasing

Sale WarrantyDeepening and Diversifying Replanning BusinessContinue to create new added value through changes and challenges, such as land utilization and overseas business development◆ New office building brand “1/1” (One)A new office brand that creates new value by fusing buildings and art.
Arrange the art of Cyril Congo, a modern French artist active around theworld, and hold a one-man exhibition at the opening of the building.

The “1/1 32117” office building, which combines art with buildings,
opens in Jingumae, Shibuya-ku, Tokyo!
New office building "1/1 32117"
External appearance

First one-man exhibition in Japan

Mr. Cyril Congo (left) and Mr. Saito (right), Presidentof the Company next to one of the works displayedin the façade of the building.

◆ New office building +SHIFTWith the concept of “choosing an office like fashion”, we are developing thebrand “+SHIFT” that goes beyond the traditional concept of office andpursues a “rich working style” required in the new era.

A new project is underway in Minato-ku, Tokyo!
New office building under project
External appearance

Completed new office buildings
Left: +SHIFT NOGIZAKA Completed and opened in April, 2021
Right: +SHIFT KANDA
Completed and opened in August, 2021

◆ NY Real Estate Revitalization Business

A business that contributes to long-term asset formation and thehappiness of families by increasing the value of real estate properties withJapanese-style comfort and having them owned mainly by Japanese Clientsin New York City, the center of arts, fashion, culture, entertainment,
politics, economy, and finance.

Value-up sale of apartment in Manhattan, New York
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Value-up building appearance

18

Interior after value-upSpecified Joint Real Estate Ventures

Promote Sales of Small-lot Real Estate Property
Sales of a nursery school, and a medical and educational mall that contribute to the lives of local
communities as small-lot productsCompass Ueno

Compass Magome

A newly built licensed nursery school, Ueno,Tokyo

Ota Ward new medical and educational mall

3-45 Taito, Taito-ku, Tokyo
2-minute walk from Naka-okachimachi Station on
Tokyo Metro Hibiya Line
6-minute walk from Okachimachi Station on JR
Yamanote and Keihin-Tohoku Lines
4-story building with a total floor area of 546.77
square meters

2-28-4 Kitamagome, Ota-ku, Tokyo
2-minute walk from Magome Station on Toei Subway
Asakusa Line
3-story building with a total floor area of 1,274.89
square meters

Fully sold on November 1!

(persons)
250

A new mall with the theme of “medical care andeducation”, in which after-school childcare,
English conversation school, etc. enter as tenants,
centered on a drugstore with a large medical
corporation and a dispensing pharmacy that has
strengths in hemodialysis

Second period on sale

Number of Investors in Small-Lot Real Estate Property

200

Sales network (tax accountants and financial
institutions)

167

150
100
50
0

A newly built licensed nursery school that is inline with SDGs and ESG investments, including
eliminating the problems of children waiting
for admission and promoting women’s
activities

Over 180 companies

66
29
FY2020/3
20/3期

FY2021/3
21/3期

FY2022/3
22/3期

FY2023/3
23/3(Forecast)
期

Increasing number of clients are investing in small-lot products to meet real estate investment needs

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

19

Expanding, aiming to reach over 200
companies

Real Estate Service Business Continues to Expand
Its Customer Base
Real Estate Service Business, which specializes in the central Tokyo area, increases clients and strengthens
its operating base
Number of Entrusted Buildings in Property Management

（棟）

500
(buildings)
400
300[Property Management entrusted property
distribution]

276

333

362

372

373

392

397

421

444

Shinjulu-ku

Chiyoda-ku

200

Chuo-ku
ChuokuShibuya-ku

100
Minato-ku
District

0
15/3期
FY2015/3

16/3期
FY2016/3

17/3期
FY2017/3

18/3期
FY2018/3

19/3期
FY2019/3

20/3期
FY2020/3

21/3期
FY2021/3

22/3期 Q2
23/3
1Q
FY2022/3
FY期
2023/3P(cases)
（件）
4,000
3,000
2,000

【Rent Guarantee Percentage of new contracts * by area】

Changes in the Number of Rent Guarantee Contracts

1,290

1,642

2,035

2,370

2,658

2,989

3,099

3,261

3,445

OthersIn Tokyo9%

4%

Other 23 wards

16%

Chiyoda-ku
20%
Chuo-ku
17%

Shinjuku-ku
8%
Shibuya-ku Minato-ku
14%
12%

1,000
0
15/3期
FY2015/3

Entrusted properties of the Company

16/3期
FY2016/3

17/3期
FY2017/3

18/3期
FY2018/3

19/3期
FY2019/3

20/3期
FY2020/3

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

期 FY2022/3
21/3
22/3期 23/3
1Q
FY2021/3
Q2 FY期
2023/320■ 5 cities of central
Tokyo 71%
■ Other Tokyo 20%

Total of 91% in Tokyo* As of March 31, 2022 : 652 new contracts

Conference Room Rental Business

Site Development to Meet Diverse Needs
In line with the diversification of work styles, we are fully compatible with web conferencing and online distribution,
meeting the needs of group training and conferences through our site network with excellent access.
September 1, 2022

Vision Center Tokyo Kyobashi Open
Nihonbashi

Tokyo

With a large hall that can

Tamachi•

Shinagawa

2,000 square meters

Shinjuku

Large facility with a total area of

Yokohama•

YotsuyaStationKanda Yurakucho
Hibiya Hamamatsucho

3 minutes walk from Shinagawa

Nagatacho•

Ueno

Vision Center Shinagawa Open

November 1, 2022

◆ Vision Center Site Network•

Direct connection to Kyobashi
Station•Best location•

With a large hall that canaccommodate 600 people

accommodate 500 people

To Haneda airport◆ Changes in Vision Center operating area
(Tsubo)

5,000

Tsubo

4,400

4,000

3,000

3,000
2,000
1,000

1,200

3,400

3,400

FY2021/3'21/1

FY2022/3
'22/1

1,500

600

0
FY2017/3'17/1

FY2018/3'18/1

FY2019/3'19/1

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

FY2020/3'20/1

21

FY2023/3'23/1

Continue High Profitability in Office Building Business● Replanning Business maintains high profit margin

Following 1Q, properties with high profit margin were sold in 2Q ahead ofschedule, driving performance as highly profitable business with highadded value.

(million yen)

70,00035.5%

60,00027.8%

50,00040,000Net sales
Segment profit
Segement margin

28.2%

30.0%

32.4%

35.0%

31.2%

29.2%

30.0%

24.3%

22.1%

25.0%

25,25530,00020,0008,954

10,000
0
‘16/3
16/3

‘17/3
17/3

‘18/3
18/3

‘19/3
19/3

PM
Leasing brokerage

‘20/3
20/3

‘21/3
21/3

22/3
‘22/3

4,000
3,206
3,000

2,330

2,491

2,508

‘16/3
16/3

‘17/3
17/3

2,821

2,829

‘18/3
18/3

‘19/3
19/3

3,490

3,803

2,551

2,000
1,000

Sales brokerage
Sub-leases
referral fee

10.0%
5.0%

2Q23/3‘23/3(million yen)

BM

15.0%

Sales Brokerage maintained strong performance. Real Estate Service
Business including Leasing, PM posted solid performance.

● Real Estate Service Business continues to grow steadily
Rental conference
room
Rent guarantee

20.0%

0.0%
’15/3
15/3

Segment profit

40.0%

0
’15/3
15/3

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

22

‘20/3
20/3

‘21/3
21/3

‘22/3
22/3

2Q
23/3
‘23/3

Hotel Operation Business

Hotel Operations Recovering(％ )OCC (L axis)
First wave of COVID-19

80

60

Sixth wave of COVID-19

ADR (R axis)

Go To Travel

100

Nationwide travel support
Relaxation of entry
restrictions

Seventh wave of COVID-19

We continue to open new hotels even in the pandemic of COVID-19, improving our services tobecome the hotel of choice for our clients, and our performance is improving.

(Yen)

20,00016,00012,000

40

8,000

20

4,000

0

0
‘20/3期
20/3
1Q

‘20/3
20/3
期
2Q

‘20/3
20/3
期
3Q

‘20/3
20/3
期
4Q

‘21/3
21/3
期
1Q

‘21/3
21/3
期
2Q

‘21/3
21/3
期
3Q

‘21/3
21/3
期
4Q

‘22/3
22/3
期
1Q

‘22/3期
22/3
2Q

‘22/3
22/3
期
3Q

‘22/3
22/3
期
4Q

‘23/3期
23/3
1Q‘23/3期
23/3
2Q◆ Newly opened hotels
8 hotels opened in two and a half years
in the pandemic of COVID-19

February 2020
Tabino Hotel Kurashiki Mizushima

April 2020
Tabino Hotel Kashima

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

February 2021
HIYORI OCEAN RESORT OKINAWA

23

June 2021
Tabino Hotel Lit Miyakojima

July 2021
Tabino Hotel Lit Matsumoto

June 2022
Shijo Kawaramachi Onsen Sora Niwa Terrace
Kyoto
Shijo Kawaramachi Onsen Bttei Kamogawa

Business Models for Hotel Business Growth
Increase value by developing and acquiring some properties in addition to operating revenues and aim for growth through synergies
with sales revenues.
<Hotel Business Model Case>

Land

Land

・ Hotel development
model caseManagement

Sell
Owner

Purchase

Development Construction
Company

Sun Frontier
Hotel Management

Management

Company

Sell

Company

Purchase

Sun Frontier
Hotel Management

Sun Frontier
Hotel Management

Owner

Company
Sun Frontier
Hotel Management

Number of Operating Hotel Rooms(room)

2,870

3,000

3,004
2,612

2,306

2,500
1,898

2,000
1,500
1,000

Lease
Contract

1,191
758

838

'17/3

'18/3

500
0
'19/3

'20/3

'21/3

'22/3

'23/3
2Q
‘23/3

23/3
(Forecast)

We will collect development funds by selling three hotels
and invest in the next project.
From now on, we plan to develop and operate the Tabino
Hotel series and small luxury hotels. We will also focus on
M&A.
Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

24

Philosophy
Systematize and further promote the Sun Frontier Philosophy
Top-level concept
Credo (Company policy)

MissionVisionValue

What for?
How youwant to be

Course of
ActionCopyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Altruism

We believe in helping others, as many as we can,throughout our lives.
Our mission is to co-create a rich and sustainable
society as we look after every employee and pursue
the happiness of both mind and matter.
Our vision is to become the most appreciatedvisionary company that fully utilizes limited resources
and continues the challenges to create new values.
1. Work For Your colleagues

5. Be GENBA-Centric

2. Stay Humble, Thankful, And
Respectful

6. Always Work Creatively

3. Do The Right Thing
4. Absolute Proactiveness25

7. Be Open-Minded Cheerful and
WonderfulManagement Principle, ESG

Business area
Contribute to solving social issues through real estateutilization, the core businessRealization of a Sustainable Society

Environmental
Protection

Office Business

Human Resource
Development

Hotel Business

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Shima Yume Project

26

Regional
Revitalization

Overseas BusinessManagement Principle, ESG

Sustainability Issues and Targets
Sustainability Vision
We will contribute to the realization of a sustainable society through business activities
while respecting the heart of altruism, the Company policy.
IImportant Issues

Social issues to besolvedPolicyEnvironmental
protection

Small and medium-sizedbuildings that can still be
used with increased value
are being demolished.
= Waste of resources■ Extend the life and health ofreal estate■ Energy conservation andreduction of environmental
impact by the Real Estate
Revitalization Business

Revitalizationof regional economies■ Create buildings, offices, andspaces with “job satisfaction”
and “creativity” that
contribute to economic
growthRegional
revitalization

Human
resource
development

Goal (KPI)

Response to massive
natural disasters■ Prevent and mitigate disasterthrough regional cooperation

Elimination of the decline in
the working-age population
due to low birthrate andaging population (realdecrease in labor force) andthe gender gap■ Respect and utilize diversity■ Create workplaces with job
satisfaction, creativity andgrowth opportunities

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

27

•
•
•
•
•
•
•
•

Extend economic estimated useful lives by at least 30%
Occupancy rate of buildings over 30 years old to be 90% or more
Retention of management after sale of replanning property to be 90% or more
Reduce carbon dioxide emissions by an average of at least 12% compared to abuilding reconstruction project
100% carbon offset
Establish internal standards by the end of FY2022
Percentage of new supply of replanning properties that exceed the establishedinternal standards to be 30% or more in FY2023
Implement tenant satisfaction surveys (for Company-owned properties)••

At least five lots by FY2023
Post disaster prevention information on the dedicated website 100% in FY2023(for Company-owned properties)•

Ratio of female management to be 12% or more by April 2025 (Sun Frontier
Fudousan Co., Ltd.)
Training hours as a percentage of prescribed working hours to be 10% or more
Increase hourly recurring profit in FY ending March 2023 year-on-year (perregular employee of Sun Frontier Fudousan Co., Ltd.)••Management Principle, ESG

ESG Data
Environment

SocialGovernance

As of September 30, 2022

Actual numberof RP buildings

Carbon Offset
Cumulative total
2,502 tons

As of April 1, 2022

Ratio of male and female employees inmanagerial positions
Target ratio of female(people)■ Male ■ Female

400

386 people

300

242
people62.7%
144people
37.3%

200

Total
453 buildings
Establishment of
SF Ocean Power
Generation Co., Ltd.

Research and study
for the realization of
new-energy
infrastructure

RE100
12 buildings
2,113 tons

100
0(persons)

100

50

0

Seven
people8.5%

Transition to an
Audit & Supervisory
Committee system

Human resource
development

Utilization rate 100%

Board of Directors
Audit & Supervisory
Committee

Training at least 10%of set working hours

Female Directors
1 out of 1111.5%

External
36.4%

Full-time
63.6%

Nomination andremuneration committee(optional)
2 out of 4 Outside Directors

Full-time Full-time

Outside Outside

From childcare leave
93.3% return to work

Ensuring transparency
and soundness

・ RE100 ・ ・ ・ ・ Carbon offset using J-credit derived from renewable energy. Initiatives to become the first in Japan to introduce this system on each floor. Achieve 0 Co2 emissions per tenant company.
・ "Mori no Denki" ・ ・ ・ Carbon offset using J-credit derived from forests. We can feel that we are supporting forests side-by-side and moving into the building will contribute to the environment.

For more information, please refer to our sustainability website → https://www.sunfrt.co.jp/sustainability/
Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Ratio of outside
directors
1/3 or moreManagement
管理職

Employee
社員

Returnto-work
ratio
93.3%

RP construction
12 buildings
261 tons

82 people
75
people91.5％

Childcare leave
Mori no Denki
7 buildings
128 tons

managers at least 12%

As of September 30, 2022

28

Business Model

Strategy in Office Business
Provide services to solve client’s every problem, mainly in the five cities of central Tokyo.

RP
12

14

11

*As of the end of September 2022

Leasing
Brokerage
21
72

Of the total number of RPs over 453
properties, 80% are located in the five cities
of central Tokyo and adjacent cities.

130

41

46

A community-based network ten branches
Ginza, Kanda, Nihonbashi, Kodemmacho, Kojimachi,
Shinjuku, Shibuya,Gotanda,Hamamatsucho, Yokohama

PM

More than 80% of the 444 entrusted
properties are located in the five cities ofcentral Tokyo. *As of the end of September 2022

BM

Of the 214 buildings under comprehensive
management, 85% are located in the five cities
of central Tokyo. *As of the end of September 2022

Rent
Guarantee

Of the 652 new contracts signed, 90% are in thefive cities of central Tokyo.

11*As of the end of September 2022

7

Rental20 of the 21 sites are located in the five cities
Conference of central Tokyo.
Room*As of the end of September 2022/One site in Yokohama* The numbers on the columns in the map are the cumulative number of RPs.

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

29

Business Model

Strengths in Office Business
Solve various problems by in-house manufacturing from purchase to development,
occupancy, sales and support, and by understanding the client’s intentions in detail.

1. Real Estate Utilization
To be a partner to solve difficulties from our client’s point of view

Fundraising Consulting

Asset consulting

Rent guarantee

Construction planning

Property management

Leasing brokerage

Sales brokerage

Property
purchase

2. Real Estate
Revitalization
Building
development ofvalue chain

Property
sales

Clients
1. Real estate utilization: Get close to clients at the site and solve problems. Capture the source of added value
from clients’ voices.
2. Real estate revitalization: Reflect our expertise to increase asset value and the needs we have identified inrevitalized buildings to increase their value and sell them.
Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

30

Business Model

Business Model for Replanning Business
Value-up of office buildings in need of large-scale repairs due to declining occupancy
rates into high-value-added real estate that is sought after by society through renovationfrom the “clients’ point of view.”

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

Creativity

Leasing power

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 andhigh-profit buildingssought by owners

Value-up

Buying power

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 force

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 © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

31

・ Full occupancy
・ Improve
income andexpenditure
・ Stable income

Business Model (Replanning Business)

Accelerate the Growth of Tenant Companies
Set-up offices focusing on the clients' point of view accelerate business growth.
Set-up office

An office that differs from the interior of a normal rental office in that it has a
reception area, reception room, and other facilities, as well as highly designoriented interior construction in the office area, with some facilities and fixtures
already installed.

Set-up office
Four benefits

Save laborNo need to devise office interiors
or select interior decorators,
greatly reducing the time andeffort of management.

Reducemanagement
burdenImproveproductivity
Office interiors with a high level ofdesign, with a focus on creativity,
functionality, and a variety of usage
scenarios, improve the recruitment of
human resources, employee
motivation, and office productivity.

Immediately
available
after
relocation

Client =Tenant company

Improve
recruitment,
motivation, andproductivity

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Shorten the
periodReducefinancialburden32

No need for any work other thanwiring and moving, significantly
shortening the relocation period
and increasing the net available
period by shortening theconstruction period for interior
finishing and restoration.

ReduceburdenSignificantly reduced costs foroffice interiors and other costs.
Tenants do not have to accountfor interior decoration assets.

Business Model (Replanning Business)

Create both Customer Value and Social ValueContribute to the resolution of social issues through contributions to our clients' businesses.
Contribute to the business growth ofbuilding owners and tenant companies
through the Replanning Business.

=
Reduce the waste of non-reproducible
resources and contribute to the prosperityof humankind, plants and animals on theearth.

Comparison of resource input over 50 years(kg / ㎡)

3,991

3,000

2,357

6,000

1,000

5,000

0
Renovation
改修

Rebuilding
建替

Repair修繕

Renovation
改修

Comparison of waste generation over 50 years(kg / ㎡)

801

49.3% ↓

800
600

4,000

3,000

2,000

406

400

Socialvalue

19.1% ↓
5,179

Rebuilding
建替

Economic
value

6,399

2,000

New bldg
新築

Clients’
value

7,000

40.9% ↓

4,000

Comparison of CO ₂ emissions over 50 years(t-CO ₂)

1,000

200
0

Rebuilding

New bldg

新築

Rebuilding

建替

0

Renovation

建替

改修

RepairRenovation

修繕

改修

Demolition

解体

Standard
標準
New新築
bldg

Maintenance

維持管理

Renovation
改修

Repair
修繕 Renovation改修
Disposal
Energy

廃棄エネルギー<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 © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

33

Business Model (Hotel and Tourism Business)

Focus on Creating Enthusiastic Fans
With the theme of “a heartwarming and fun hotel”, we aim to be the only hotel in the world.
Brand development

Sado (Chigusa)
Sado (Aikawa Oura)
Sado (Aikawa Kabuse)

Luxury Class

Upper Middle Class

Shijo Kawaramachi Onsen Bettei
Kamogawa

HIYORI Hotel Tokyo Ginza East

HIYORI OCEAN RESORT OKINAWA

HIYORI Hotel Maihama
HIYORI Hotel HIYORI Hotel Osaka
Namba Ekimae

Matsumoto

Onna,
Okinawa
Kyoto Shijo

Takayama

KashimaMiyakoIslandMaihama
NaritaKoiwa

Shimonoseki
HakataKurashiki
Mizushima

Tokoname

Ginza

Osaka
Namba

KawasakiUpper Class

Tabi no Hotel Lit Matsumoto

Kasugazaki Onsen Hotel Osado

Tabi no Hotel Lit Miyakojima

Sado Resort Hotel AZUMATabino Hotel Villa Miyakojima NEW

Shijo Kawaramachi Onsen Soraniwa
Terrace Kyoto

Spring Sunny H Nagoya Tokoname
EkimaeEconomy Class

Budget ClassDONDEN Highland Lodge Natural Resort
Sado

SKY HEART Hotel Narita

Tabino Hotel Sado

SKY HEART Hotel Koiwa

Tabino Hotel Hida-Takayama

SKY HEART Hotel Kawasaki

Tabino Hotel Kashima

SKY HEART Hotel Hakata

Tabino Hotel Kurashiki Mizushima

SKY HEART Hotel Shimonoseki(As of November 2022)

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

34

Business Model

Business Model of Overseas BusinessContributing to the development of local communities by creating client's joy andhappiness through the creation of new businesses.
A total business that includes acquisition of land, development and construction, delivery after completion, and management and mediation.

Acquireland

Development
Construction

Completion
DeliveryManageUrban
Development

Contribute to future performance through systematic andcontinuous development efforts
China

Hanoi

Land
acquisition

Development
Land
acquisition

Laos

Completiondelivery
Development

Land
acquisition

Hai Phong
Hue

Completiondelivery
Development

ThailandCambodiaCompletiondeliveryVietnamHo Chi Minh

Rooted in the local community in Vietnam, we work together with local partners to ensure high construction quality,a safe, organized, and beautiful construction site.

Next project in progress!
Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Da Nang City
Hoi An36

Business Model

Regional Revitalization Business Dream Project
We will energize islands through tourism!

SADO

When rural areas are energized, so Japan as a whole will be. As the number ofvisitors to Japan rapidly increases, spurred by fascination (culture, history, nature,
food, hot spring, hospitality and others) that Japan is proud of, we will take on thechallenge of regional revitalization projects that focus on the attractiveness andfeatures unique to regions, in particular the regions that possess the“Wonderfulness of Japan.”

Sado Island,
Niigata Prefecture
Tabino Hotel Sado
Donden Kogen Lodge
Port of Ryotsu

Miyako Shimoji Airport Restaurant

Coral port

Okesa Kanko Taxi

Operation starts on October 1, 2022.

Tabino Hotel Lit
Miyakojima

Miyako Shimojishima
AirportHotel Osado
Sado Outdoor BaseMIYAKO
Miyako Island,
Okinawa

Hotel AZUMATabino Hotel Villa Miyakojima
New Operation starts on November 3, 2022.

LE BLUESADO SAWANE

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

36

Medium-term Management Plan

Basic Policy and Growth Strategies
Basic Policy
Providing “a place where people gather and communicate with each other, andcreate social development and happiness for people"

Growth strategy
OfficeDeepen and expand the Office Building Business

Hotel

Create services that go beyond satisfaction and excitementwith a sharp concept

Offshore

Expand housing-related business in Vietnam
Invest in peripheral businesses to expand the current
business and invest in start-ups in growth fields

M&A

Key Points

ESG

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Digital37

Cash flow

MarketingMedium-term Management Plan

Targets and Progress
FY ending March 2023
Second quarter Result

FY ending March 2023
Forecast

FY ending March 2025
Target35.3 billion yen

84 billion yen

100 billion yen

8 billion yen

12.8 billion yen

20 billion yen

5.3 billion yen

8.3 billion yen

14 billion yen

Ordinary profit ratio

22.7％

15.2%

20%

Equity ratio

54.3％

50% level

50% level-

10% or more

10% or more

Net sales
Ordinary profit
Net profit(100（億円）
million yen)

売上高
Net sales

1,200

ROE

Ordinary profit
経常利益

1000

Net profit
当期純利益

1,000

840

800
600

732

712
596

533

400
353

200
0

128

'19/1
‘19/3

88

161

107

‘20/3
'20/1

122

75 44
‘21/3
'21/1

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

74

128
80

‘22/3
'22/1

38

200
83

140

53

（予）
’23/3
'23/1 (Forecast)

・・・
'24/1

(Forecast)
’25/3
'25/1
（予）

Medium-term Management Plan

Medium-term Investment Plan(FY ended March 2022 – FY ending March 2025)

Overseas Business

Hotel Business

Office Business
Balance at the end of
March 2021

72.8 billion yen

Balance at the end of
March 2021

21.8 billion yen

Balance at the end of
March 2021

0.6 billion yen

Investment amount

200 billion yen

Investment amount

7 billion yen

Investment amount

8 billion yen

Amount collected

182.8 billion yen

Amount collected

5.8 billion yen

Amount collected

2.5 billion yen

Balance at the end of
March 2025

23 billion yen

Balance at the end of
March 2025

6.1 billion yen

Balance at the end of
March 2025

90 billion yen

Plan procurement and development to achieve business growth while
recovering investments at a constant turnover rate.
Refocus on purchasing properties while holding back during the
confusion caused by the pandemic of COVID-19.
Make sound investments in short-term, medium- to long-term, andnew construction development.

Complete the hotels under construction. Aim to achieve
profitability in operating existing hotels. Collect funds
through the sale of land and buildings, operating themeffectively.
Planned hotel completed. Sell, collect, and reinvest.

Continuously and systematically invest in
condominium development projects for the future.
Land acquisition procedure is in progress for the
next development projects.

Digitalization 3 billion yen
Continue to actively invest in data-driven management

M&A 5 billion yen
Systematically invest in peripheral businesses and growth areas to expand existing businesses

Building databases
Developing drone image
analysis AI

Diversification and customer
expansion to create businesssynergies

Generate free cash flow
Ensuring positive free cash flow through systematic investment and recovery
Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

39

Reference Materials

Trends in Office Vacancy Rates and Rents In
Five Cities of Central Tokyo(%)

Peak vacancy rate
August 2003
Vacancy rate: 8.57%

Average rent as of
September 2022

Peak average rent
August 2008
22,901 yen

20,156 yen(Yen)(down 94yen MoM)
Average vacancy rate in
September 2022

6.49%
(0.00%pt MoM)
Peak vacancy rate
June 2012
Vacancy rate: 9.43%

Bottom of average
rent
October 2004
17,526 yen

Five cities average rent (yen/tsubo)

Bottom of average
rent
December 201316,207 yen

Bottom of vacancy rate
November 2007
Vacancy rate: 2.49%

Peak average rent
July 2020
23,014 yen

Bottom of vacancy rate
February 2020
Vacancy rate: 1.49%

Five cities average vacancy rate (%)* Source: Compiled by the Company based on Miki Shoji's "Office Report”. Office buildings with a standard floor area of 100 tsubo or more in five central cities of Tokyo are covered.

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

40

Reference Materials

Long-term Trends in Office Vacancy Rate and Rent
(Yen)

(％)

50,00045,000

Average rent
平均賃料
(L axis)44,193
8.08

9.01

Vacancy rate
空室率
(R axis)8.12

40,000

Average vacancy rate in
September 2022

10

6.49%

9

Average rent in
September 2022

20,156 yen

35,0008

6.33 6.49

30,0007

6

25,00022,18620,0005

20,156
4

17,577

16,2073.77

15,00021,999

3

3.17
2.65

10,000

2

1.79
1.55

5,000

1

0.39
0

0
19901991 1992 1993 1994 1995 1996 1997 1998 19992000 2001 2002 2003 2004 2005 2006 2007 20082009 2010 2011 2012 2013 2014 2015 20162017 2018 2019 2020 2021 2022
Source: Compiled by the Company based on Miki Shoji's "Office Report"
Target office buildings with a standard floor area of 100 tsubo or more in five central cities of Tokyo are covered.
Figures for 2021 and earlier are taken as of December of each year.

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

41

Reference Materials

Age Distribution of Office Buildings in Tokyo’s 23 Cities
Solving social issues through the revitalization and utilization of aging small-to- medium-sized buildings
Tokyo 23 cities 9,378 buildings
75

Small and medium-sized(Total floor area: 300 to 5,000 tsubo)

8,620 buildings

Large-sized

70(Total floor area: Over 5,000 tsubo)

65758 buildings

60

Old seismic code:
2,132 buildings (25%)

Old seismic code:
122 buildings (16%)

55
50

20 years old or more:

45

7,523 buildings

40

（87％）

35

20 years old or more:

440 buildings（58％）

Age of buildings

30
25
20
15

Less than 20 years old:

Less than 20 years old:

10

1,097 buildings (13%)

318 buildings (42%)

5
0

800

600

400

200

0

Number of buildings

200

400

600

800

Source : Created by us based on "Tokyo 23 cities Office Pyramid 2022 (based on the number of buildings)" (Xymax Real Estate Institute)

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

42

Reference Materials

Market Size and Number of Corporations in Tokyo
Contributing to the development of society and the happiness of people in Tokyo,
a city where people and companies gather(Thousand people)

Ratio of Tokyo population to Japanese population (estimate)
Population of
東京都人口
Tokyo

160,000

Population of
日本人口

Population of Tokyo as a percentage of the population of Japan
東京人口が日本人口に占める割合

Japan

25.0%

140,000

20.0%

120,000
100,000

15.0%

80,00060,00040,000

11.1%

11.4%

11.7%

11.9%

12.6%

9.5%

9.8%

12,064

12,577

13,15913,515

13,85013,97913,93813,754

13,458

2000年

2005年

2010年

2015年

2020年

2025年

2030年

2035年

2040年

20,000
0

10.6%

10.3%

10.0%
5.0%
0.0%

Source: Compiled by the Company based on Tokyo Metropolitan Government statistics - "Population of Tokyo (Estimate).”Top 10 Prefectures in Number of Corporations
Tokyo
東
京
Osaka
大
阪
Kanagawa
神 奈 川
Aichi
愛
知
Saitama埼
玉Hokkaido
北 海 道
Chiba
千
葉
Hyogo
兵
庫
Fukuoka福岡Shizuoka静岡575,234
223,407
184,363
153,694130,108
119,564
107,704
94,01383,562
76,981

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

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

43

Reference Materials

Population Movement in the Three Major
Metropolitan Areas and Local Areas
The past economic crisis was the starting point for the number of people moving into the Tokyo area to increase.
（Ten thousand people）

40

First peak of population
inflow (1961)

20

Net Inflow

10Second peak of
population inflow (1987)

Tokyo area

30

Third peak of population
inflow (2007)

Fourth peak of
population inflow (2019)

Osaka area
Nagoya area

0
(10)
(20)
(30)
(40)

Local area

Oil crisis

Collapse of bubble economy

Global financial
crisisCOVID-19
crisis

(50)
(60)
(70)

Source: Compiled by the Company based on "Number of people moving in by place of residence before the move and number ofpeople moving out by place of residence after the move" from the Statistics Bureau of the Ministry of Internal Affairs andCommunications.

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

44

Reference Materials

Transition and Present
Change, challenge and create new value with the Sun Frontier Spirit

100,000

Ordinary

Net
Sales

売上高

120,000

23.5%
20.6% 21.3%
18.5%
14.0%

24.4%

Lehman
Shock

20.8%

80,00060,000

CoronaShock

経常利益率
Profit Margin

20.2%

19.3%

13.2%
48,150

12.6%

11.5%

16,731

14,4694,290 6,924

100,000

22.0%

53,292
47,46440,39527,74130,626

26,871
5,004 7,761

24.0%

71,251

59,632

20.0%
20.0%
15.0%

17.1%
12.6%

10.0%

17,772
10,581

5.0%
0.0%

0
01/3 02/3 03/3 04/3 05/3 06/3 07/3 08/3 09/3 10/3 11/3 12/3 13/3 14/3 15/3 16/3 17/3 18/3 19/3 20/3 21/3 22/3 23/3 24/3 25/3
(Forecast)(Forecast)2001 to 20092010 to 2020

2021～

Basic construction of Replanning Business

Evolution and expansion of Replanning Business

Deepening and diversifying theReplanning Business

Replanning business

Set-up office
Hotel
Rental space
Overseas

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

25.0%

84,00073,21835,255681 1,771 3,588

22.0% 22.7%

15.8%

40,00020,000

22.9%

30.0%

45

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 (Currently Tokyo Stock Exchange Prime)

Capital Stock *11,965 million yen

Representative
Number of Consolidated
Employees *Average Age of
Employees*

Tomoaki Horiguchi, Chairman Representative Director
Seiichi Saito, President Representative Director
732 full-time employees (1,353 including part-timers and temporary workers)
36.0 years old
Real estate revitalization

Business Profile

Real estate service

Real estate management, brokerage, construction
planning, non-payment guarantee, operation ofrental buildings, asset consulting

Hotel and tourism
Accounting Month
Listed Market

March
Tokyo Stock Exchange Prime (Code number: 8934)

Full-time directors
From the left in the front row : Seiichi Saito, President and Representative Director ; Tomoaki
Horiguchi, Chairman and Representative Director.
From the left in the back row: Mitsuhiro Ninomiya, Director; Yasushi Yamada, Senior Managing
Director; Izumi Nakamura, Executive Vice President; Kenji Honda, Director.

* As of the end of September 2022

Copyright © 2022 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

46

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