MATTERS DISCLOSED ON THE INTERNETRELATED TO THE
NOTICE OF CONVOCATION OF
THE 122nd ORDINARY GENERAL MEETING OF SHAREHOLDERS

Consolidated Statement of Changes in Net Assets…………………

1

Notes to the Consolidated Financial Statements…………………

2

Non-consolidated Statement of Changes in Net Assets …………………

23

Notes to the Non-consolidated Financial Statements25…………………

The content of this document is posted on the website of Mitsubishi Estate Co., Ltd.
(“the Company”) (https://www.mec.co.jp/e/investor/stock/shareholder/index.html),
pursuant to laws and regulations and Article 16 of the Articles of Incorporation of the Company.

[Translation for Reference and Convenience Purposes Only]

Consolidated Statement of Changes in Net Assets(From April 1, 2020, to March 31, 2021)(Millions of yen)
Shareholders’ equity
Capital stock
Balance at the beginning ofcurrent period
Changes in the fiscal year
under review
Issuance of new shares

Capital surplus

Retained earnings

142,147

164,041

962,840131

130

Treasury stock

Total shareholders’equity(105,282)

1,163,746

262

Dividend from surplus(40,155)(40,155)

Profit attributable to ownersof parent

135,655

135,655

Purchase of treasury stock
Disposal of treasury stock(25)

Reversal of land revaluation
reserve
Change in equity of the parent
company on transactions with
non-controlling interests
Net changes in items other thanthose in shareholders’ equity
Total of changes in the fiscal
year under review
Balance at the end of current
period

(17)

(17)

83

58

142

142

195

195

131

326

95,617

66

96,141

142,279

164,367

1,058,457(105,216)

1,259,887

Other accumulated comprehensive income
Net
DeferredRemeasureStock
NonunrealizedLand
Foreign
Total othergains orments
gain onrevalua- currency
accumulated acquisition controlling
losses onof definedrightsinterests
availabletiontranslation
comprehenhedging
benefitfor-salereserve adjustments
sive income
instruments
plans
securities
Balance at the beginning ofcurrent period
Changes in the fiscal year underreview

79,527(1,948)526,623(29,321)(4,163)570,716288

Total net
assets206,454 1,941,206

Issuance of new shares

262

Dividend from surplus(40,155)

Profit attributable to owners ofparent135,655

Purchase of treasury stock(17)

Disposal of treasury stock58

Reversal of land revaluation
reserve

142

Change in equity of the parent
company on transactions with
non-controlling interests

195

Net changes in items otherthan those in shareholders’equity38,56031(206)(24,418)

7,327

21,294

(56)

2,861

24,099Total of changes in the fiscal
year under review

38,56031(206)(24,418)

7,327

21,294

(56)

2,861

120,241

Balance at the end of current
period118,088(1,916)526,417(53,740)

3,163

592,011231-1-209,316 2,061,447

[Translation for Reference and Convenience Purposes Only]

Notes to the Consolidated Financial Statements
Notes on Important Matters for the Preparation of the Consolidated Financial Statements
1. Matters related to the Scope of Consolidation(1) Number of Consolidated Subsidiaries: 232
The names of major subsidiaries are as stated in “I. Current Situation of the Mitsubishi Estate Group, 8.
Situation of Material Subsidiaries, (1) Situation of Material Subsidiaries” of the “Business Report.”
Newly included in the list of consolidated subsidiaries of the Company are Mitsubishi Estate (Thailand)Co., Ltd. and twenty-three (23) other companies due to a new establishment, etc.
Excluded from the list of consolidated subsidiaries are Aqua City Investment SPC and thirty-two (32)other companies due to a dissolution, etc.
(2) Names, etc. of Major Non-consolidated Subsidiaries
A major non-consolidated subsidiary is Higashi-Shizuoka 15Gaiku Development Tokutei Mokuteki
Kaisya.
Non-consolidated subsidiaries are excluded from the scope of consolidation because their respective sumsof total assets, revenue from operations, profit (loss) (corresponding to the equity ratio owned by theCompany) and retained earnings (corresponding to the equity ratio owned by the Company) have nosignificant impact on the consolidated financial statements.
2. Matters related to Application of the Equity Method(1) Number of Non-consolidated Subsidiaries Accounted for by the Equity Method: 0(2) Number of Affiliates Accounted for by the Equity Method: 130
A major affiliate in this category is Tokumei Kumiai Otemachi Kaihatsu.
Included in the affiliates accounted for by the equity method are Kashtha Holdings, Inc. and seventeen(17) other companies due to a new establishment, etc.
Meanwhile, 28 STATE STREET LLC and seven (7) other companies are excluded from the affiliates
accounted for by the equity method due to a dissolution, etc.
(3) Names, etc. of Major Companies Not Accounted for by the Equity Method
A major non-consolidated subsidiary not accounted for by the equity method is Higashi-Shizuoka 15Gaiku
Development Tokutei Mokuteki Kaisya and a major affiliate not accounted for by the equity method is
Tokiwabashi Investment Tokutei Mokuteki Kaisya. The equity method is not applied to the Company’s
investments in these corporations because their respective sums of profit (loss) (corresponding to theequity ratio owned by the Company) and retained earnings (corresponding to the equity ratio owned by theCompany) have no significant impact on the consolidated financial statements.
(4) Others
Concerning the companies accounted for by the equity method, the financial statements for the respective
fiscal years are used for those that have a closing date that differs from the consolidated closing date.
3. Matters related to Business Year, etc. of Consolidated Subsidiaries
The closing date of MEC Group International, Inc., which is a consolidated subsidiary, and one hundred
ninety (190) overseas subsidiaries, MEC eco LIFE Co., Ltd. and four (4) other consolidated subsidiaries is
December 31 and the closing date of Keiyo Tochi Kaihatsu Co., Ltd. and one (1) other consolidated subsidiaryis January 31. In preparing the consolidated financial statements, the financial statements as of and for the year
ended respective closing dates are used for these companies with necessary adjustments provided forconsolidation purposes with regard to material transactions between their closing dates and the consolidated
closing date (March 31).

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[Translation for Reference and Convenience Purposes Only]
4. Matters related to Accounting Policies(1) Valuation Basis and Method for Important Assets
Securities:
Held-to-maturity debt securities:
Carried at amortized cost (determined by the straight-line method for the Company and its
consolidated domestic subsidiaries and by the interest method for consolidated foreign subsidiaries.)
Other securities:
Investment securities:
Available-for-sale securities with market values:
Stated at the market value as of the balance sheet date, based on quoted market prices, etc.
(Unrealized gains and losses are reported, net of applicable taxes, in a separate component of
net assets. The cost of securities sold is determined mainly by the moving-average method.)
Available-for-sale securities without market values:
Stated at cost determined by the moving-average method
Equity investments:
Available-for-sale securities with market values:
Stated at the market value as of the balance sheet date, based on quoted market prices, etc.
(Unrealized gains and losses are reported, net of applicable taxes, in a separate component of
net assets. The cost of equity investments sold is determined mainly by the moving-averagemethod.)Available-for-sale securities without market values:
Stated at cost determined by the moving-average method
Derivatives:
Stated at market values
Inventories:
Real estate for sale: mainly stated at cost determined by the identified cost method. (The amountposted in the Balance Sheets was computed by writing down the book value with regard to theinventories for which profitability was clearly declining.)
Work-in-process real estate for sale: Same as the above
Real estate for development: Same as the above
Expenditures for uncompleted works: Same as the above
Fixed Assets:
The Company and its consolidated domestic subsidiaries adopt asset-impairment accounting.
Consolidated subsidiaries overseas apply International Financial Reporting Standards and U.S.
accounting standards.
(2) Depreciation Method of Important Depreciable Assets
Property and equipment:
Depreciation of property and equipment of the Company and its consolidated domestic subsidiaries iscalculated principally by the declining-balance method at fixed rates.
However, the straight-line method is adopted for buildings (excluding building improvements) acquiredon or after April 1, 1998 and building improvements and structures acquired on or after April 1, 2016.
Depreciation of property and equipment of consolidated foreign subsidiaries is calculated by thestraight-line method.
Intangible assets:
The amortization of intangible assets is computed by the straight-line method. Capitalized software forinternal use is amortized by the straight-line method over the estimated internal useful life (mainly 5
years).

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[Translation for Reference and Convenience Purposes Only](3) Accounting Policies for Important Reserves
Allowance for doubtful receivables:
An allowance for doubtful receivables is provided, for possible losses from uncollectible loans andreceivables, at the amount calculated based on the actual rate of losses from the bad debt for ordinary
receivables, and on the estimated recoverability for specific receivables such as doubtful receivables.
Accrued directors’ retirement benefits:
In consolidated subsidiaries, accrued directors’ retirement benefits are provided at 100% of the amountthat would be required at the end of the fiscal year under review in accordance with internal regulations.
Provision for environmental measures:
An estimated amount of loss that could be caused along with environmental measures including
treatment of PCB (Polychlorinated biphenyl) waste is provided.
(4) Accounting Method for Retirement Allowances
1) Method to attribute estimated retirement allowances to period of services
To calculate the Company’s liability for retirement allowances, the method of benefit formula basis ismainly adopted to attribute the estimated amounts of retirement allowance obligations to the period up
to the end of the fiscal year under review.
2) Accounting method for actuarial gains or losses and prior service cost
Prior service cost is mainly amortized on a straight-line basis over a certain period (1 year–10 years)
within an average remaining period of service of employees at the time of each occurrence.
Actuarial gains or losses are mainly amortized on a straight-line basis over a certain period (1 year–15
years) within an average remaining period of service of employees at the time of their occurrence, witheach amount recognized as an expense starting from the following fiscal year.
(5) Translation of Important Assets and Liabilities Denominated in Foreign Currencies into Yen
The assets and liabilities denominated in foreign currencies of foreign subsidiaries are translated into yen
at the spot rate of foreign exchange in effect at the balance sheet date of the respective subsidiaries. The
revenue and expense accounts of foreign subsidiaries are translated into yen using the average rate offoreign exchange during the fiscal year under review. The resulting translation exchange differences havebeen presented as “Foreign currency translation adjustments” under “Net assets.”(6) Important Hedge Accounting
1) Hedge Accounting
The Company adopts the deferral hedge accounting, in principle. For interest rate swaps, thepreferential treatment is applied to the swaps which satisfy the requirements of such preferential
treatment. For currency swaps, the appropriation treatment is applied to the swaps which satisfy therequirements of such appropriation treatment.
2) Hedging Instruments and Hedged Items
Hedging instruments:
Hedged items:
Interest rate swaps
Borrowings
Currency swaps
Borrowings and corporate bonds
Borrowings
Equity of the foreign subsidiaries
3) Hedging Policy
The risk hedging transactions are intended to hedge the exposure to fluctuation risks in interest rates
and foreign currency exchange rates, in accordance with the internal regulations such as “Market Risk
Management Rules” and “Management Guideline by Risk.”
4) Method of Assessing Hedge Effectiveness
The Company compares the cumulative amounts of fluctuations in the rates or in the cash flows of thehedged items with the cumulative amounts of fluctuations in the rates or in the cash flows of thehedging instruments, and assesses the effectiveness of hedging transactions based on the ratio between
the two amounts.
However, the assessment of hedge effectiveness is omitted for interest rate swaps to which special
treatment is applied.
(7) Accounting for Consumption TaxesTransactions subject to the consumption tax and local consumption
tax are recorded at amounts exclusive of consumption taxes. Non-deductible consumption tax and local
consumption tax are charged to income for the fiscal year under review.
(8) Accounting Policies for Revenue from Operations
Recognition criteria for net sales of completed construction contracts and cost of sales of completed
construction contracts
To account for revenue from contract work operations, the percentage of completion method (thepercentage of completion of work is estimated based on cost method) is adopted for work that has been-4-

[Translation for Reference and Convenience Purposes Only]
completed and whose guaranteed performance has been recognized by the end of the fiscal year underreview. For other work, the complete-contract method is adopted.
Recognition criteria for revenue related to finance lease transactions
The Company recognizes net sales and cost of sales related to finance lease transactions at the time ofreceipt of the lease payments.
(9) Amortization Method and Amortization Period of Goodwill
Goodwill is equally amortized over five (5) years on a straight-line basis. However, if the effect-emerging
period can be reasonably estimated, the amount is equally amortized over the estimated period or if theamount is small, it is amortized for one (1) time.

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Notes on Changes in Presentation(Changes due to the Application of the “Accounting Standard for Disclosure of Accounting Estimates”)
The “Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31, March 31, 2020)
has been applied from the fiscal year under review, and “Notes on Accounting Estimates” are provided in these
Notes to the Consolidated Financial Statements.

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[Translation for Reference and Convenience Purposes Only]
Notes on Accounting Estimates
1. Valuation of Property and Equipment(1) Amount Recorded in the Consolidated Financial Statements for the Fiscal Year under Review
Amount(Millions of yen)
4,179,893
Property and equipment
4,679
Impairment loss(2) Other Information
1) Calculation Method for the Amount Recorded in the Consolidated Financial Statements for the Fiscal
Year under Review
The Group mainly owns real estate properties such as office buildings, commercial facilities, outlet
malls, hotels, logistics facilities as property and equipment. For property and equipment owned by theGroup, if the total undiscounted future cash flows from an asset or asset group, for which events orchanges in circumstances indicate that the book value of the asset or asset group may not berecoverable, are less than the book value, the book value is reduced to the recoverable amount, andsuch reduced amount is recorded as an impairment loss, in accordance with the Accounting Standard
for Impairment of Fixed Assets.
When grouping assets in order to judge whether to recognize impairment losses or to perform themeasurement of impairment losses, a unit for asset grouping shall be the smallest unit that generates
cash flows that are largely independent of the cash flows of other assets or groups of assets.
The higher of net sale value and value in use is used as recoverable amount. While the net sale value isexpressed as an appraised value by a real estate appraiser or estimated trading price, the discounted
future cash flows are used to measure the value in use.
2) Major Assumptions
In principle, the Group makes estimates for each individual property. The estimation is made based on
major assumptions by each asset class, taking into account the condition of individual properties.
The major assumptions used when estimates were made in the current fiscal year are as follows.
 Offices
Average rents have recently been on a steady positive trend, which is expected to continue in the next
fiscal year. On the other hand, we assume that it will take longer than usual for vacancy improvement
as many companies are currently cautious about floor expansion or relocation for expansion due to theimpact of the novel coronavirus disease (COVID-19).
 Commercial facilities and outlet malls
As commercial rents include variable rents that are linked to tenant sales, there is a correlation between
rents and tenant sales at the relevant commercial facilities. In the fiscal year under review, tenant sales
have decreased from the previous fiscal year due to the impact of COVID-19. However, they are
currently on an improving trend, so we assume that this effect on sales will be limited in the next fiscal
year and beyond.
 Hotels
Currently, occupancy rates have stayed at low levels due to the impact of COVID-19 and it is expected
to take a certain period of time for occupancy rates to recover to the level we had before being affectedby COVID-19. For our estimates, we assumed that hotel demand would recover to the pre-COVID-19
levels in around 2024, the same timing as for the recovery in global air passenger demand.
 Logistics facilities
Logistics facilities have not been affected by COVID-19, and the market has been favorable.
Therefore, we assume that performance of logistics facilities will continue to be steady in the next
fiscal year and beyond as is expected for the market trend.
 Redevelopment projects
The Group is engaged in multiple redevelopment projects. Compared with other development projects,
redevelopment projects have potential risks entailing that their profitability will be lower than initial
estimates as a result of delays or changes in plans. Such risks include the risk of not obtaining
agreement from other landowners in the area planned for redevelopment, and the risk of not obtaining
development permission from local governments.
The Group comprehensively assesses these various risks for redevelopment projects. However, theredevelopment projects currently underway are not in any situation that would decrease theirprofitability from the initial estimates. We therefore assume that these redevelopment projects will
progress while maintaining their profitability.

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[Translation for Reference and Convenience Purposes Only]
3) Impact on the Consolidated Financial Statements for the Next Fiscal YearThe estimation of impairment losses is made based on the descriptions of 2) Major Assumptions.
Therefore, if major assumptions used for estimating impairment losses worsen, additional impairment
losses may be recognized in the next fiscal year.
2. Valuation of Inventories(1) Amount Recorded in the Consolidated Financial Statements for the Fiscal Year under Review
Amount(Millions of yen)
Real estate for sale
88,116
267,563
Work-in-process real estate for sale
561
Loss on devaluation of inventories recorded(2) Other information
1) Calculation Method for the Amount Recorded in the Consolidated Financial Statements for the Fiscal
Year under Review
If the net sale value of inventories falls below the book value, due to a decline in profitability, theGroup reduces the book value to the net sale value and records the reduced amount as loss ondevaluation, in accordance with the Accounting Standard for Measurement of Inventories. The net salevalue is the estimated sales value less the estimated additional construction costs and estimated sales
expenses.
2) Major Assumptions
The major assumption used in the estimation of net sale value for the fiscal year under review are as
follows.
Considering factors such as the latest quarterly distribution of sales by agreement date, contract prices
and number of model units visitors, the net sale values of projects whose performance is generally inline with or better the initial business plan are estimated based on the initial business plan. Meanwhile,the net sale values of projects whose performance has deteriorated from the initial business plan are
estimated based on a revised business plan, taking into consideration conditions unique to each projectsuch as the status of progress, market prices in the neighborhood and incurrence of additional costs. As
for the impact of COVID-19, we assume that the impact will be limited because current demand issteady and inventory is decreasing.
In addition, pre-construction land for development related to the condominium business has potential
risks entailing that its profitability may be lower than initially expected as a result of delays in the
projects or changes in the plan during the period up to the sales. Such risks include the risk of thedeclining of future selling price, the risk of excessive supply, and the risk of construction delay due toconsultation with neighbors.
The Group comprehensively assesses these various risks for pre-construction land for development.
However, the pre-construction projects currently underway are not in any situation that would decrease
their profitability from the initial estimates. We therefore assume that such development projects will
progress while maintaining their profitability.
3) Impact on the Consolidated Financial Statements for the Next Fiscal YearIn the valuation of inventories, the book value is written down based on the descriptions of 2) Major
Assumptions by the lower of cost or market (LCM) method. Therefore, changes in these major
assumptions used for the valuation of inventories may result in the recording of a gain on sales or an
additional loss on devaluation in the next fiscal year.

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3. Valuation of Equity Investments(1) Amount Recorded in the Consolidated Financial Statements for the Fiscal Year under Review
Amount(Millions of yen)
496,182
Equity investments(2) Other information
1) Calculation Method for the Amount Recorded in the Consolidated Financial Statements for the Fiscal
Year under Review
If the effective market value of equity investments without market price declines significantly, theGroup reduces the book value by a reasonable amount, and records such reduced amount as an
impairment loss on equity investments, in accordance with the Accounting Standard for Financial
Instruments.
In calculating the effective market value, the Group performs valuations of assets held by investees foreach purpose of holding.
2) Major Assumptions
For assets held by investees, major assumptions are determined according to the purpose of holding
such assets. For the details of assumptions made for the relevant assets, please refer to 1. Valuation of
Property and Equipment and 2. Valuation of Inventories.
3) Impact on the Consolidated Financial Statements for the Next Fiscal YearThe estimation for impairment loss on equity investments is made based on assumptions described in
2) Major Assumptions. Therefore, if there are changes in these major assumptions, it may result in
additional impairment losses on equity investments in the next fiscal year.

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Note to the Consolidated Balance Sheet
1. Accumulated Depreciation for Property and Equipment: ¥1,748,844 million
The accumulated depreciation above includes the accumulated impairment loss.
2. Assets Subject to Collateral and Secured Debt
(1) Assets Subject to Collateral:
Buildings and structures
Machinery and equipment and vehicles
Land
Other (other property and equipment)
Total(2) Debt Secured by the Above:
Short-term borrowings
Long-term debt to be repaid within one (1) year
Long-term debt
Total

¥194,614 million¥1,353 million¥231,751 million¥2 million¥427,722 million¥100 million¥24,779 million¥65,211 million¥90,091 million- 10 -

[Translation for Reference and Convenience Purposes Only]
3. Contingent Obligations(1) Guarantee Obligations
Warrantee
Amount of obligation
Substance of obligation
Home buyers¥31,667 million
Borrowings from financial institutions
Total¥31,667 million
The guarantee obligations for home buyers mainly mean the Company’s joint and several guarantees tosecure the repayment of housing loans of home buyers in favor of financial institutions, which continue
until the registration of the creation of the corresponding mortgages has been completed.
(2) Guarantee of Acceptance of Businesses
Warrantee
Amount of obligation
Substance of obligation¥13,744 million
PT. Windas Development
Borrowings from financial institutions(US$132,800 thousand)¥4,619 million
Borrowings from financial institutions
NoMad 29th Street(US$44,637 thousand)¥1,868 million
Meeyahta Development, Ltd.
Borrowings from financial institutions(US$16,875 thousand)
TRCC/Rock Outlet¥1,803 million
Borrowings from financial institutions
Center, LLC(US$17,423 thousand)Lehigh Valley Industrial Park
¥1,565 million
Borrowings from financial institutions
Investor Holdings, LLC(US$15,128 thousand)¥6,467 million
CL Office Trustee Pte. Ltd.
Borrowings from financial institutions(S$82,900 thousand)¥1,131 million
Glory SR Trustee Pte. Ltd.
Borrowings from financial institutions(S$14,500 thousand)Lendlease OSH Residential A Pry¥18,986 million
Borrowings from financial institutions
Ltd(AU$225,069 thousand)¥10,351 million
Twin Peaks Joint Stock Company(US$95,000 thousand,Borrowings from financial institutions
VND115,925 million)¥2,848 million
RML548Co., Ltd.
Borrowings from financial institutions(THB805 million)
Total¥63,387 million
The Company guarantees acceptance of businesses in favor of creditors of Meeyahta Development, Ltd.,
Lendlease OSH Residential A Pry Ltd and RML548Co., Ltd. in the amount equivalent to the percentage ofequity interest owned by the Company.
MEC Group International Inc. guarantees acceptance of businesses in favor of creditors of NoMad 29th
Street, TRCC/Rock Outlet Center, LLC and Lehigh Valley Industrial Park Investor Holdings, LLC in theamount equivalent to the percentage of equity interest owned by the MEC Group International Inc.
Mitsubishi Estate Asia Pte. Limited guarantees acceptance of businesses in favor of creditors of CL Office
Trustee Pte. Ltd. and Glory SR Trustee Pte. Ltd. in the amount equivalent to the percentage of equity
interest owned by Mitsubishi Estate Asia Pte. Limited.
Mitsubishi Estate Asia Pte. Limited and MEA Commercial Holdings Pte. Ltd. guarantee acceptance ofbusinesses in favor of creditors of PT. Windas Development. Furthermore, for the amount in excess of theamount equivalent to the percentage of equity interest owned by Mitsubishi Estate Asia Pte. Limited and
MEA Commercial Holdings Pte. Ltd., the Company has received either the provision of collateral or
guarantees from its business partners.
MEA Commercial Holdings Pte. Ltd. guarantees acceptance of businesses in favor of creditors of Twin
Peaks Joint Stock Company in the amount equivalent to the percentage of equity interest owned by MEA
Commercial Holdings Pte. Ltd.

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[Translation for Reference and Convenience Purposes Only]
4. Revaluation of Land
The Company and some of its consolidated subsidiaries revalued the land used for its business in accordancewith the “Act on Revaluation of Land” (Act No. 34, March 31, 1998) and the “Act Partially Amending the Act
on Revaluation of Land” (Act No. 19, March 31, 2001). The revaluation difference has been included in “Netassets” as “Land revaluation reserve,” net of the related tax that is included in “Liabilities” as “Deferred tax
liabilities for revaluation.”
Revaluation method: The value of land is determined based on the assessed value of the fixed property tax
adjusted reasonably, as stipulated in Article 2, item (iii), of the Order for
Enforcement of the Act on Revaluation of Land (Cabinet Order No. 119, March 31,
1998).
Date of revaluation: March 31, 2002
Notes to the Consolidated Statement of Income
In response to the request to refrain from business and declaration of a state of emergency issued by thenational and local governments, the Group has taken measures such as closing commercial facilities and hotels
to prevent the spread of COVID-19.
As a result, some expenses (e.g., depreciation or rents) incurred by commercial facilities and hotels during theclosed period are recorded as loss on infectious disease.

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[Translation for Reference and Convenience Purposes Only]
Notes to the Consolidated Statement of Changes in Net Assets
1. Class and Total Number of Issued Shares and Class and Number of Shares of Treasury Stock(Thousands of shares)
Number of Shares
Number of Shares
Increase during
Decrease during
as of the Beginning
as of the End of
the Fiscal Yearthe Fiscal Year
Fiscal Year underof Fiscal Yearunder Review
under Review
Reviewunder Review
Issued shares:
Shares of
1,391,174
154—
1,391,328
commonstock(Note 1)
Total
1,391,174
154—
1,391,328
Treasury stock:
Shares of
52,67798
42
52,733commonstock(Note 2)
Total
52,67798
42
52,733
Notes:
1. The increase in the number of issued shares was due to the issuance of new shares through third-party
allotment (154 thousand shares).
2. The increase of 98 thousand shares in the number of the shares of treasury stock of the Company was due tothe purchase of restricted stock (88 thousand shares) and the purchase of shares less than one (1) unit (9thousand shares). The decrease of 42 thousand shares was due to the exercise of stock options (41 thousand
shares) and the sale of shares less than one (1) unit (1 thousand shares).
2. Matters related to Dividends from Surplus(1) Dividends Paid
Date of Resolution
Ordinary General Meetingof Shareholders held on
June 26, 2020
Meeting of Board of
Directors held on
November 11, 2020

Class of
SharesTotal
Amount ofDividends(Millions ofyen)

Dividendper Share(Yen)

Commonstock

24,09218

March 31,2020

June 29,
2020

Commonstock

16,06212

September
30, 2020

December 4,
2020

Record Date

Effective
Date(2) Of the Dividends for which the Record Date belongs to the Fiscal Year under review, those for which the
Effective Date of the Dividends will be in the following Fiscal Year
Total
AmountSource of Dividend
Class ofof
RecordEffective
Planned Date of Resolution
Funds for per Share
SharesDividends
Date
Date
Dividends(Yen)(Millionsof yen)Ordinary General Meeting
CommonRetained
March 31, June 30,
of Shareholders to be held
25,43319
stockearnings
2021
2021
on June 29, 2021

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[Translation for Reference and Convenience Purposes Only]
3. Matters related to Stock Acquisition Rights

Breakdown of Stock
Acquisition Rights

Class of
SharesSubject toStock
Acquisition
RightsNumber of the Shares subject to Stock Acquisition Rights(Shares)
As of theBeginning of
Fiscal Year
under
Review

Increaseduring the
Fiscal Year
under
Review

Decreaseduring the
Fiscal Year
under
Review

As of theEnd of Fiscal
Year under
Review

Stock acquisition rights granted
by a resolution at the meeting
Common
2,000
—
—
2,000
of the Board of Directors heldstock
on July 26, 2007
Stock acquisition rights granted
by a resolution at the meeting
Common
3,000
—
—
3,000
of the Board of Directors heldstock
on July 31, 2008
Stock acquisition rights granted
Commonby a resolution at the meeting
11,000
—
5,000
6,000
stock
of the Board of Directors heldon July 31, 2009 1
Stock acquisition rights granted
by a resolution at the meeting
Common21,000—8,000
13,000of the Board of Directors heldstock
2
on July 30, 2010
Stock acquisition rights granted
Commonby a resolution at the meeting
29,000—12,00017,000stockof the Board of Directors held
3
on July 29, 2011
Stock acquisition rights granted
by a resolution at the meeting
Common26,000—7,000
19,000of the Board of Directors heldstock
on July 31, 2012 4
Stock acquisition rights granted
by a resolution at the meeting
Common21,000—4,000
17,000of the Board of Directors heldstock
on July 31, 2013 5
Stock acquisition rights granted
Commonby a resolution at the meeting
28,000—5,000
23,000stockof the Board of Directors heldon July 31, 2014 6
Stock acquisition rights granted
by a resolution at the meeting
Common24,000——24,000of the Board of Directors heldstock
on July 31, 2015
Notes:
1. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 31, 2009, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.
2. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 30, 2010, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.
3. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 29, 2011, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.
4. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 31, 2012, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.

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[Translation for Reference and Convenience Purposes Only]
5. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 31, 2013, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.
6. The decrease in the number of stock acquisition rights, which were granted by a resolution at the meetingof the Board of Directors held on July 31, 2014, for the fiscal year under review resulted from the exerciseof the stock acquisition rights.

- 15 -

[Translation for Reference and Convenience Purposes Only]
Notes on Financial Instruments
1. Matters relating to Financial Instruments(1) Policies to approach to financial instruments
The Group raises the necessary funds (mainly bank borrowings and bond issues) in light of the capital
investment plan. In terms of fund management, it makes every effort to avoid market risks by emphasizing
liquidity and shortening the fund management period. As for derivative transactions, the Group makes it apolicy not to engage in speculative transactions, focusing primarily on hedging exposures to fluctuation ofinterest rates, reducing interest expenses, and hedging the exposure to fluctuation risks in foreign currency
exchange rates.
(2) Contents and risks of financial instruments
Notes and accounts receivable - trade, which are trade receivables, are exposed to the credit risks ofcustomers. Trade receivables in foreign currencies arising from overseas operations are exposed to risks ofcurrency fluctuations.
Securities and investment securities include mainly held-to-maturity debt securities and shares ofcompanies with which we have business relationships, and are exposed to risks of fluctuations in market
prices.
Equity investments includes mainly preferred equity investments in special-purpose companies under
the Law Concerning Liquidation of Assets, investments in investment units of real estate investment trusts,
and investments in anonymous partnerships into special-purpose companies. They are exposed to credit
risks of respective issuers, risks of changes in interest rates, and risks of fluctuations in market prices.
Guarantee money and deposits paid for leased premises are exposed to credit risks of business partners.
Most of notes and accounts payable - trade, which are trade payables, are due within one (1) year. Someof them in foreign currencies are exposed to risks of currency fluctuations.
Borrowings and corporate bonds are intended to raise funds required mainly for capital expenditures,and their maturity dates and repayment dates are in a maximum of sixty (60) years after the closing date.
Although some of them have floating rates and are exposed to interest rate risks, they are hedged throughderivative transactions (interest rate swaps.)
Derivative transactions include interest rate swaps, currency swaps and forward exchange contracts.
Interest rate swaps hedge exposures to interest rates by fixing interest rates for financing at floatinginterest rates. Some of the consolidated subsidiaries trade interest rate and currency swaps based on thesame trading policies and for the same utilization purposes as the Company adopts.
(3) Risk management systems relating to financial instruments(i) Management of credit risks (risks of contractual defaults by business partners)
The Group periodically monitors trade receivables, and guarantee money and deposits paid of major
business partners through the department in charge of each segment, manages the due date and thebalance by business partner, and discovers promptly and reduces the risks of failures to collectmoney due to their deteriorating financial positions(ii) Management of market risks (risks of fluctuations in foreign exchange rates and interest rates)
The Group capitalizes on interest rate swap and currency swap transactions to limit the risks offluctuations in interest rates on debts and corporate bonds. In terms of securities and investment
securities, the Group assesses the market values and financial positions of issuers (business partners)
on a regular basis. As for those excluding held-to-maturity debt securities, the Group continuously
reviews positions in consideration of the market conditions and relationships with business partners.
(iii) Management of liquidity risks of financing (risks of failure to pay on the due date)
The Group in a timely way develops and updates the financing plans through departments in charge
based on reports from each department, and manages liquidity risks by maintaining cash balances.
(4) Supplemental explanation for matters relating to market values, etc. of financial instruments
Market values of financial instruments include values based on market prices and values reasonably
calculated if they have no market prices. Since calculations of the relevant values incorporate variablefactors, the relevant values may vary depending on the assumptions adopted.

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[Translation for Reference and Convenience Purposes Only]
2. Matters related to Market Values, etc. of Financial Instruments
Amounts stated on the consolidated balance sheet as of March 31, 2021, market values, and their differences
are shown as follows. Items, of which market values are considered extremely difficult to determine, are notincluded in the table below (see Note 2).
(Millions of Yen)
Reported Amounts on
Market Value
Difference
the Consolidated
Balance Sheet(1) Cash on hand and in banks
170,040
170,040—(2) Notes and accounts
52,031
receivable – trade
Allowance for doubtful(553)
receivables (*1)
51,47751,477—(3) Securities and Investment
securities(i) Held-to-maturity debt
2,865
2,873
8
securities(ii) Other securities
231,524
231,524—(iii) Shares of subsidiaries
60
594
533
and affiliated companies(4) Equity investments
18,11818,118—
Total assets
474,088474,630541(1) Notes and accounts payable
60,50760,507—– trade(2) Short-term borrowings
141,785
141,785—(3) Long-term debt to be repaid
127,643
127,643—
within one (1) year
(4) Commercial paper
50,00050,000—(5) Corporate bonds to be
65,00065,000—redeemed within one (1) year
(6) Corporate bonds
745,759
770,126
24,367(7) Long-term debt
1,393,858
1,414,828
20,969Total liabilities
2,584,554
2,629,891
45,336(*1) Allowances for doubtful notes and accounts receivables are excluded.
Notes:
1. Methods of calculating market values of financial instruments
Assets(1) Cash on hand and in banks
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(2) Notes and accounts receivable - trade
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(3) Securities and Investment securities
The market values of stocks, etc. are based on the prices on stock exchanges and those of debt
securities are based on the prices presented mainly by correspondent financial institutions.
(4) Equity investments
The market values of equity investments are based on the prices on stock exchanges.

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[Translation for Reference and Convenience Purposes Only]
Liabilities(1) Notes and accounts payable - trade
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(2) Short-term borrowings
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(3) Long-term debt to be repaid within one (1) year
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(4) Commercial paper
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(5) Corporate bonds to be redeemed within one (1) year
They are based on the relevant book values, as they are quickly settled and their market values
are close to their book values.
(6) Corporate bonds
The market values of corporate bonds are based on the market prices, etc.
(7) Long-term debt
Of long-term debt, those with variable interest rates are calculated based on the relevant bookvalues as they promptly reflect market interest rates and their market values are considered to
be close to their book values. Those with fixed interest rates are calculated based on the present
values derived by discounting the total amount of principal and interest at rates obtained bycomparison with similar debts that would be newly employed.
2. Financial instruments whose market values are deemed to be extremely difficult to assess
Reported Amounts
on theCategory
Consolidated
Balance Sheet(Millions of yen)
52,171(i) Unlisted stocks (*1)
478,063(ii) Equity investments (*2)
136,478(iii) Guarantee money and deposits paid (*3)
466,891(iv) Guarantee money and deposits received (*4)(*1) Unlisted stocks are not subject to the disclosure of market values, as they have no market prices andtheir market values are deemed to be extremely difficult to assess.
(*2) Of equity investments, those without market prices are not subject to the disclosure of market values, as
their market values are deemed to be extremely difficult to determine.
(*3) Guarantee money and deposits paid for leased premises are not subject to the disclosure of market
values, as they have no market prices and the real deposit period from the move-in date to the move-out
date is difficult to calculate. Consequently, their reasonable cash flows are deemed to be extremely
difficult to estimate.
(*4) Guarantee money and deposits received for leased premises by tenants are not subject to the disclosureof market values, as their reasonable cash flows are deemed to be extremely difficult to estimate, giventhat they have no market prices and it is hard to calculate the real deposit period from the move-in dateto the move-out date of the tenants. In addition, other fund deposits are not subject to the disclosure ofmarket values, as their real deposit period is deemed to be difficult to calculate. Consequently, theirreasonable cash flows are deemed to be considered extremely difficult to estimate.

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[Translation for Reference and Convenience Purposes Only]
Notes on Leased Real Estate
The Company and some of its consolidated subsidiaries own office buildings for rent, commercial facilities
for rent and others in Tokyo and other areas including overseas areas (the United States, United Kingdom,etc.) for the purpose of obtaining revenue from leases.
Some office buildings for rent in Japan are regarded as real estate including parts used as leased real estatesince they are used by the Company and some of its consolidated subsidiaries.
The reported amounts on the consolidated balance sheet and the fair values of these leased real estate andreal estate including parts used as leased real estate at the end of the fiscal year under review are as follows:
Reported Amounts on the Consolidated
Balance Sheet (Millions of yen)
Leased real estate
Real estate including spaces used asleased real estate

Fair Value(Millions of yen)

3,565,590

7,441,369

545,404

919,848

Notes:
1. The reported amounts on the consolidated balance sheet have deducted accumulated depreciation
costs and accumulated impairment losses from the acquisition cost.
2. Fair values at the end of the fiscal year under review are based on the following:(1) Fair values of real estate in Japan are calculated by the Company based mainly on the Real EstateAppraisal Standards.
(2) Fair values of real estate overseas are values appraised principally by local real estate appraisers.
Per-Share Information
Net assets per share
Earnings per share¥1,383.47¥101.34- 19 -

[Translation for Reference and Convenience Purposes Only]
Significant Subsequent Events(Purchase of Treasury Stock)
The Company resolved to repurchase its treasury stock under Article 156, which is applicable in accordance with
Article 165, paragraph (3) of the Companies Act, at the meeting of Board of Directors held on April 8, 2021. The
Details are as follows.
1. Reason for the Repurchase of Treasury StockTo improve capital efficiency and shareholder value as part of the capital policy in the Long-termManagement Plan
2. Details of Matters Concerning Repurchase(1) Class of shares to be repurchased
Common stock(2) Total number of shares to be repurchased
22,000,000 shares (Maximum)(1.64% of the total number of issued shares (excluding treasury stock))(3) Total amount of repurchase price¥30,000 million (Maximum)(4) Period of repurchase
From April 9, 2021 to March 31, 2022
(5) Method of repurchase
Open market purchase on the Tokyo Stock Exchange- 20 -

[Translation for Reference and Convenience Purposes Only]
Other Notes
1. Impairment Loss
The impairment loss is recorded for the following asset groups for the fiscal year under review.
Major application
Leased assets, etc.
(total 25 groups)

Category
Land and buildings, etc.

Location
Nishinomiya-shi, Hyogo; etc.

Asset grouping for the Group was made based on a minimum unit that generates cash flows, which issubstantially independent from cash flows of other assets or asset groups. Company condominiums are
regarded as shared assets.
As a result, the book values of twenty-five (25) asset groups, consisting of those for which the market prices
fell considerably compared with the book values due to a decline of land prices and those for which
profitability decreased considerably due to fallen rent levels or deteriorated market conditions, etc., werereduced to the respective recoverable amounts and such reduced amounts were recorded as an impairment
loss (¥4,679 million) under extraordinary loss.
The breakdown of such impairment loss was ¥3,105 million in land and trusted land, and ¥1,574 million inbuildings, structures and others. The recoverable amounts of asset groups are measured with net sale value
or value in use, and the net sale value is principally expressed as an appraised value by a real estateappraiser. Future cash flows discounted at a rate of five (5) % are principally used to compute the value inuse.
2. Asset Retirement Obligations(1) Asset retirement obligations posted on the Consolidated Balance Sheet
1) Outline of the asset retirement obligations
These obligations include obligations to restore the original state related to periodically renewed
land lease contracts and building lease contracts.
2) Computation method for the asset retirement obligations
Asset retirement obligations are computed regarding the remaining contract years as an expected
use period and using a discount rate between 0.0% and 2.3%.
3) Increase (decrease) of asset retirement obligations for the fiscal year under review
Balance at the beginning of the fiscal year under review:¥6,236 million
Increase due to the acquisition of property and equipment:¥656 million
Adjustments due to the elapse of time:¥70 million
Decrease due to the fulfillment of asset retirement obligations:¥(20) million
Increase (decrease) due to other reasons:¥73 million
Balance at the end of the fiscal year:¥7,015 million(2) Asset retirement obligations that are not posted on the Consolidated Balance Sheet
The following asset retirement obligations are excluded from the posted amounts:
1) Obligation to remove asbestos that is used for some property and equipment at the time of removalof the property and equipment in a particular way required by the Ordinance on Preventing Asbestos
Hazards
For some of the property and equipment of the Company, the demolition of a building involves anobligation to remove asbestos. However, no demolition has taken place yet other than demolition
related to redevelopment or other projects that required arrangements with many businessassociates. It is difficult to estimate the timing to fulfill such obligation due to causes such asdeterioration, based on the estimated physically usable period of the asset. We cannot estimate
when to demolish the property and equipment without relevant specific management plans.
To address the issue of asbestos, we have been voluntarily conducting asbestos removal workwhen tenants move out or when other opportunities allow us to do so. However, we cannot make areasonable estimate of how such voluntary asbestos removal work will progress in the future basedon the data such as how long past tenants stayed. Also, we cannot estimate the remaining amountof asbestos when such property and equipment are demolished. Moreover, it is difficult to only
estimate the asbestos removal cost separately from regular demolition costs. For these reasons, anasbestos removal-related probability assessment relative to the domain and amounts of asset
retirement obligation is difficult. Therefore, an obligation to remove asbestos is excluded from thereported asset retirement obligations although we made a best estimate taking into account theevidence available as of the closing date.

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[Translation for Reference and Convenience Purposes Only]
2) Obligation to restore the original state based on some real estate rental agreements
Periodically renewed land lease contracts for some commercial facilities require restoration to theoriginal state when the contract term ends and the facility must be returned. In reality, however, it
is possible to continue to use such facilities by renewing such contracts and some contracts set
forth a special provision to reduce the possibility of performing such obligation to restore theoriginal state, which makes the timing to fulfill the obligation somewhat vague. In terms of ourbusiness strategies and the business environment, we do intend to continue with our operations andtherefore fulfillment of this obligation is not intended. For these reasons, a probability assessment
relative to the domain and amounts of asset retirement obligation is difficult to ascertain.
Therefore, an obligation to restore the original state is excluded from the reported asset retirement
obligations although we made a best estimate taking into account the evidence available as of theclosing date.

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[Translation for Reference and Convenience Purposes Only]

Non-consolidated Statement of Changes in Net Assets(From April 1, 2020, to March 31, 2021)(Millions of yen)
Shareholders’ equity
Retained earnings

Capital surplus

Other retained earnings
Capitalstock

Balance at the
beginning ofcurrent period
Changes in thefiscal year underreviewIssuance of
new shares
Dividend fromsurplusCapitalreserve

Total
capitalsurplusRetainedearnings

142,147

171,260

171,260

21,663

131

130

130

Provision
Reserve for
for
Reserve foradvancedreserve
specialdepreciation for open
depreciaof fixed
innovation
assetstion
promotion

1,489

154,038—

Generalreserve

Earnedsurpluscarriedforward108,254341,242

Treasury
stock

Total
shareholders’equity626,687(105,282)

834,812

262

ProfitPurchase oftreasury stock
Disposal oftreasury stockReversal ofreserve for
specialdepreciation
Reversal ofreserve foradvanceddepreciation of
fixed assets
Provision forreserve for
open
innovation
promotionReversal oflandrevaluation
reserve
Net changes in
items otherthan those inshareholders’equityTotal of changes
in the fiscal year
under review
Balance at theend of current
periodTotal
retainedearnings(40,155)(40,155)(40,155)

110,616

110,616

110,616

(25)
(634)

(25)

(17)

(17)

83

58

634

(2,541)

2,541

208

(208)

142

142

142

131

130

130

—

(634)

(2,541)

208—

73,54570,57866

70,907142,279

171,390

171,390

21,663

855

151,496208

108,254414,787

697,266(105,216)

905,720- 23 -

[Translation for Reference and Convenience Purposes Only](Millions of yen)
Valuation, translation adjustments and others

Balance at the beginningof current period
Changes in the fiscal year
under review

Net unrealized
gain onavailable-for-salesecurities

Deferred gains orlosses on hedging
instruments

Land revaluation
reserve

Total valuation,translation
adjustments andothersStockacquisitionrights

79,532(1,872)529,965

607,626

288

Total net
assets1,442,727

Issuance of new shares

262

Dividend from surplus(40,155)

Profit110,616

Purchase of treasury
stock

(17)

Disposal of treasury
stock

58

Reversal of reserve for
special depreciation—

Reversal of reserve foradvanced depreciation of
fixed assets
Provision for reserve foropen innovation
promotionReversal of land
revaluation reserve
Net changes in items
other than those inshareholders’ equity——
142
38,558440(142)38,856(56)

38,799Total of changes in thefiscal year under review

38,558440(142)38,856(56)

109,706

Balance at the end ofcurrent period

118,090(1,431)

529,822646,482231

1,552,434- 24 -

[Translation for Reference and Convenience Purposes Only]

Notes to the Non-consolidated Financial Statements
Notes on Matters Related to Significant Accounting Policies
1. Valuation Basis and Method for Securities
Held-to-maturity debt securities:
Carried at amortized cost (straight-line method)
Shares of subsidiaries and affiliates:
Stated at cost determined by the moving-averagemethodOther securities:
Investment securities:
Available-for-sale securities with market values:
Stated at the market value as of the balance sheet
date, based on quoted market prices etc. Unrealized
gains and losses are reported, net of applicable taxes,
in a separate component of net assets. The cost of
securities sold is determined by the moving-averagemethodAvailable-for-sale securities without market values: Stated at cost determined by the moving-averagemethodEquity investments:
Available-for-sale securities with market values:
Stated at the market value as of the balance sheet
date, based on quoted market prices, etc. Unrealized
gains and losses are reported, net of applicable taxes,
in a separate component of net assets. The cost ofequity investments sold is determined by themoving-average method
Available-for-sale securities without market values: Stated at cost determined by the moving-averagemethod
2. Valuation Basis and Method for Derivatives
3. Valuation Basis and Method for Inventories
Real estate for sale:

Work-in-process real estate for sale:
Real estate for development:

Stated at market values
Stated at cost determined by the identified cost method (Theamount posted in the Balance Sheets was computed by writing
down the book value with regard to the inventories for which
profitability was clearly declining.)
The same as above
The same as above

4. Depreciation Method of Fixed Assets
Property and equipment:
Depreciation is computed by the declining-balance method at fixed
rates.
However, the straight-line method is adopted for the Yokohama
Landmark Tower and buildings (excluding building
improvements) acquired on or after April 1, 1998 and building
improvements and structures acquired on or after April 1, 2016.
Intangible assets:
The amortization of intangible assets is computed by the straight-line
method.
Capitalized software for internal use is amortized by the straightline method over the estimated internal useful life (5 years).

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[Translation for Reference and Convenience Purposes Only]
5. Accounting Policies for Reserves
Allowance for doubtful receivables:

Reserve for retirement allowances:

Reserve for accepting the fulfillment of obligations:

Provision for environmental measures:

An allowance for doubtful receivables is provided,for possible losses from uncollectible loans andreceivables, at the amount calculated based on theactual rate of losses from the bad debt for ordinary
receivables, and on the estimated recoverability forspecific receivables such as doubtful receivables.
A reserve for retirement allowances is provided at
the amount calculated based on the projectedamounts of retirement benefit obligations and plan
assets at the end of the fiscal year under review forordinary employees, and at 100% of the amountthat would be required at the end of the fiscal year
under review in accordance with internal
regulations for executive officers.
To calculate the Company’s liability for retirement
allowances to employees, the method of benefit
formula basis is adopted to attribute the estimatedretirement allowances to accounting periods up to
the end of the fiscal year under review.
Prior service cost is amortized, starting from thetime of its occurrence, on a straight-line basis overa certain period (10 years) within an averageremaining service period of employees at the timeof its occurrence. Actuarial gains or losses areamortized, starting from the following fiscal year,
on a straight-line basis over a certain period (10years) within an average remaining service periodof employees at the time of their occurrence.
A reserve for accepting the fulfillment of
obligations is provided at the estimated amount oflosses that may be caused by accepting thefulfillment of obligations.
An estimated amount of loss that could be caused
along with environmental measures including
treatment of PCB (Polychlorinated biphenyl) waste
is provided.

6. Accounting for Deferred Assets
The costs are fully charged to income when disbursed.
7. Hedge Accounting(1) Hedge accounting:
The Company adopts the deferral hedge accounting, in principle. For interest rate swaps, the preferential
treatment is applied to the swaps which satisfy the requirements of such preferential treatment. For
currency swaps and forward exchange contracts, the appropriation treatment is applied to the contracts
which satisfy the requirements of such appropriation treatment.
(2) Hedging instruments and hedged items:
Hedging instruments:
Hedged items:
Interest rate swaps
Borrowings
Currency swaps
Borrowings and corporate bonds
Forward exchange contracts
Shares of affiliated companies(3) Hedging policy:
The risk hedging transactions of the Company are intended to hedge its exposure to fluctuation risks ininterest rates and foreign currency exchange rates, in accordance with the Company’s internal regulations
such as “Market Risk Management Rules” and “Management Guideline by Risk.”(4) Method of Assessing Hedge Effectiveness
The Company compares the cumulative amounts of fluctuations in the rates or in the cash flows of thehedged items with the cumulative amounts of fluctuations in the rates or in the cash flows of the hedging- 26 -

[Translation for Reference and Convenience Purposes Only]
instruments, and assesses the effectiveness of hedging transactions based on the ratio between the two
amounts.
However, the assessment of hedge effectiveness is omitted for interest rate swaps to which special
treatment is applied.
8. Accounting for Consumption Taxes
Transactions subject to the consumption tax and local consumption tax are recorded at amounts exclusive ofconsumption taxes. Non-deductible consumption tax and local consumption tax are charged to income for the
fiscal year under review.

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[Translation for Reference and Convenience Purposes Only]
Notes on Changes in Presentation
1. Changes due to the Application of the “Accounting Standard for Disclosure of Accounting Estimates”
The “Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31, March 31,2020) has been applied from the fiscal year under review, and “Notes on Accounting Estimates” are provided
in the Notes to the Non-consolidated Financial Statements.
2. Changes in Presentation of Non-consolidated Statement of Income
In the non-consolidated statement of income for the previous fiscal year, “Revenue from Building Business”
and “Revenue from other businesses” were separately presented under Revenue from operations, while “Costof revenue from Building Business” and “Cost of revenue from other businesses” were separately presented
under Cost of revenue from operations. However, in conjunction with changes in the segment classification
effective from the fiscal year under review, these items are collectively presented as “Revenue fromoperations” and “Cost of revenue from operations,” respectively, in the non-consolidated statement of income
from the fiscal year under review, in order to improve readability and clarity of the non-consolidated financial
statements.

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[Translation for Reference and Convenience Purposes Only]
Notes on Accounting Estimates
1. Valuation of Property and Equipment(1) Amount Recorded in the Non-consolidated Financial Statements for the Fiscal Year under Review
Amount(Millions of yen)
2,957,482
Property and equipment
2,656
Impairment loss(2) Other Information
1) Calculation Method for the Amount Recorded in the Non-consolidated Financial Statements for the
Fiscal Year under Review
The Company mainly owns real estate properties such as office buildings, commercial facilities,
hotels, logistics facilities as property and equipment. For property and equipment owned by theCompany, if the total undiscounted future cash flows from an asset or asset group, for which events orchanges in circumstances indicate that the book value of the asset or asset group may not berecoverable, are less than the book value, the book value is reduced to the recoverable amount, andsuch reduced amount is recorded as an impairment loss, in accordance with the Accounting Standard
for Impairment of Fixed Assets.
When grouping assets in order to judge whether to recognize impairment losses or to perform themeasurement of impairment losses, a unit for asset grouping shall be the smallest unit that generates
cash flows that are largely independent of the cash flows of other assets or groups of assets.
The higher of net sale value and value in use is used as recoverable amount. While the net sale value isexpressed as an appraised value by a real estate appraiser or estimated trading price, the discounted
future cash flows are used to measure the value in use.
2) Major Assumptions
In principle, the Company makes estimates for each individual property. The estimation is made basedon major assumptions by each asset class, taking into account the condition of individual properties.
The major assumptions used when making estimations in the fiscal year under review are as follows.
 Offices
Average rents have recently been on a steady positive trend, which is expected to continue in the next
fiscal year. On the other hand, we assume that it will take longer than usual for vacancy improvement
as many companies are currently cautious about floor expansion or relocation for expansion due to theimpact of the novel coronavirus disease (COVID-19).
 Commercial facilities
As commercial rents include variable rents that are linked to tenant sales, there is a correlation between
rents and tenant sales at the relevant commercial facilities. In the fiscal year under review, tenant sales
have decreased from the previous fiscal year due to the impact of COVID-19. However, they are
currently on an improving trend, so we assume that this effect on sales will be limited in the next fiscal
year and beyond.
 Hotels
Currently, occupancy rates have stayed at low levels due to the impact of COVID-19 and it is expected
to take a certain period of time for occupancy rates to recover to the level we had before being affectedby COVID-19. For our estimates, we assumed that hotel demand would recover to the pre-COVID-19
levels in around 2024, the same timing as for the recovery in global air passenger demand.
 Logistics facilities
Logistics facilities have not been affected by COVID-19, and the market has been favorable.
Therefore, we assume that performance of logistics facilities will continue to be steady in the next
fiscal year and beyond as is expected for the market trend.
 Redevelopment projects
The Company is engaged in multiple redevelopment projects. Redevelopment projects have potential
risks entailing that their profitability will be lower than initially estimated as a result of delays orchanges in plans. Such risks include the risk of not obtaining agreement from other landowners in thearea planned for redevelopment, and the risk of not obtaining development permission from local
governments.
The Company comprehensively assesses these various risks for redevelopment projects. However, theredevelopment projects currently underway are not in any situation that would decrease theirprofitability from the initial estimates. We therefore assume that these redevelopment projects will
progress while maintaining their profitability.

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[Translation for Reference and Convenience Purposes Only]
3) Impact on the Non-consolidated Financial Statements for the Next Fiscal YearThe estimation of impairment losses is made based on the descriptions of 2) Major Assumptions.
Therefore, if major assumptions used for estimating impairment losses worsen, additional impairment
losses may be recognized in the next fiscal year.
2. Valuation of Equity Investments(1) Amount Recorded in the Non-consolidated Financial Statements for the Fiscal Year under Review
Amount(Millions of yen)
307,000
Equity investments(2) Other information
1) Calculation Method for the Amount Recorded in the Non-consolidated Financial Statements for the
Fiscal Year under Review
If the effective market value of equity investments without market price declines significantly, theCompany reduces the book value by a reasonable amount, and records such reduced amount as an
impairment loss on equity investments, in accordance with the Accounting Standard for Financial
Instruments.
In calculating the effective market value, the Group performs valuations of assets held by investees foreach purpose of holding.
2) Major Assumptions
For assets held by investees, major assumptions are determined according to the purpose of holding
such assets. For the details of assumptions made for the relevant assets, please refer to 1. Valuation of
Property and Equipment and 2. Valuation of Inventories in the Notes on Accounting Estimates in theNotes to the Consolidated Financial Statements.
3) Impact on the Non-consolidated Financial Statements for the Next Fiscal YearThe estimation for impairment losses on equity investments is made based on assumptions describedin 2) Major Assumptions. Therefore, if there are changes in these major assumptions, it may result in
additional impairment losses on equity investments in the next fiscal year.

- 30 -

[Translation for Reference and Convenience Purposes Only]
Notes to the Non-consolidated Balance Sheet
1. Accumulated Depreciation for Property and Equipment:¥1,156,346 million
The accumulated depreciation above includes the accumulated impairment loss.
2. Contingent Obligations(1) Guarantee Obligations
Warrantee
Mitsubishi Estate London Limited
MEC Global Partners Holdings
LLC
MITSUBISHI ESTATE NEWYORK Inc.
Lendlease OSH Residential A Pty
Ltd
RML548Co., Ltd.
Meeyatha Development, Ltd.
Ryoei Life Service Co., Ltd.
Total
(2) Keep-well agreement
Warrantee

Amount of Obligation¥113,582 million(GBP669,600 thousand,
SEK918,000 thousand)¥30,733 million(US$182,800 thousand,
GBP21,200 thousand,€56,000 thousand)¥29,448 million(US$266,000 thousand)¥18,986 million(AU$225,069 thousand)¥2,848 million(THB805 million)¥1,868 million(US$16,875 thousand)

Substance of Obligation
Borrowings from financial
institutions
Borrowings from financial
institutions

Borrowings from financial
institutions
Borrowings from financial
institutions
Borrowings from financial
institutions
Borrowings from financial
institutions
Deposits for repayment obligation to¥177 million
residents¥197,646 million

Amount of Obligation
Substance of Obligation¥9,410 million Borrowings from financial
MEC Finance USA, Inc.
(US$85,000 thousand) institutions
Total¥9,410 million
The Company signed keep-well agreement to complement the credit for funding by MEC Finance USA, Inc.
3. Monetary Receivables/Payables due from/to Affiliated Companies
Short-term receivables due
Long-term receivables due¥13,125 million
from affiliated companies
from affiliated companies
Short-term payables due toLong-term payables due to¥209,056 million
affiliated companies
affiliated companies- 31 -¥41,231 million¥7,516 million

[Translation for Reference and Convenience Purposes Only]
4. Revaluation of Land
The Company revalued the land used for its business in accordance with the “Act on Revaluation of Land”(Act No. 34, March 31, 1998) and the “Act Partially Amending the Act on Revaluation of Land” (Act No. 19,
March 31, 2001). The revaluation difference has been included in “Net assets” as “Land revaluation reserve,”
net of the related tax that is included in “Liabilities” as “Deferred tax liabilities for revaluation.”
Revaluation method: The value of land is determined based on the assessed value of the fixed property tax
adjusted reasonably, as stipulated in Article 2, Item 3, of the Order for Enforcementof the Act on Revaluation of Land (Cabinet Order No. 119, March 31, 1998).
Date of revaluation: March 31, 2002
5. Equity Investments
Of the equity investments projects, the total amount of investments in anonymous partnership and preferred
equity investments, etc. into anonymous partnerships and special-purpose companies that fall under the
category of affiliated companies is ¥284,447 million.
Notes to the Non-consolidated Statement of Income
1. Transactions with Affiliated Companies
Revenue from operations:¥53,372 million
Cost of revenue from operations:¥70,340 million
Transactions other than operating transactions:¥67,781 million
2. In response to the request to refrain from business and declaration of a state of emergency issued by thenational and local governments, the Group has taken measures such as closing commercial facilities andhotels to prevent the spread of COVID-19.
As a result, some expenses (e.g., depreciation or rents) incurred by commercial facilities and hotels during theclosed period are recorded as extraordinary loss for COVID-19.
Notes to the Non-consolidated Statement of Changes in Net Assets
Class and Number of Shares of Treasury Stock at the End of the Fiscal Year under Review
Common stock:
52,733,879 shares
Note on Tax-effect Accounting
The significant components of deferred tax assets and liabilities are summarized as follows:
Deferred tax assets:(Millions of yen)
Reserve for retirement allowances
4,450
Accrued bonus
1,187
Loss on devaluation of investment securities
5,639
Loss on devaluation of inventories
410
Loss on devaluation of golf memberships
267
Loss on devaluation of fixed assets
42,561
Land revaluation reserve
22,727
Reserve for accepting the fulfillment of obligations
1,181
Impairment loss on equity investments
3,855
Transfer of business due to reorganization
8,899
Other
36,008Subtotal deferred tax assets
127,190
Valuation reserve(69,943)
Total deferred tax assets
57,246
Deferred tax liabilities:
Reserve for advanced depreciation of fixed assets
Gain on establishing a trust for retirement benefits
Land revaluation reserve
Net unrealized gain on available-for-sale securities
Fixed assets valuation difference
Other
Total deferred tax liability
Net deferred tax liability- 32 -

66,861
7,393
265,595
50,801
53,242
21,712465,606
408,360

[Translation for Reference and Convenience Purposes Only]
Notes on Transactions with Related Parties
Subsidiaries and Affiliates, etc.
Category

Name ofCompany, etc.

Ownership
Percentage of
VotingRights, etc.

Subsidiary

Mitsubishi
Estate London
LimitedIndirectly
holding(100%)

Subsidiary

Mitsubishi
EstateResidence
Co., Ltd.

Directly
holding(100%)

The
Company’s
Relationshipwith theRelated Party
Guarantee
obligation
Interlocking
directors
Provision ofloansInterlocking
directors

Transaction
Amount(Millions ofyen)Account
Item

Guarantee obligation 1

113,582—

Provision of loans 2557,000

Collection of loans

469,000

Short-termloans ofaffiliatedcompanies

Interest income 2

1,589

—

Description of Transactions

Fiscal Yearend Balance(Millions ofyen)—

499,000—

Transaction conditions and decision policy thereof, etc.:
Notes:
1. The amount represents guarantee obligation to secure bank borrowings (GBP669,600 thousand,
SEK918,000 thousand) of Mitsubishi Estate London Limited.
2. Interest rates on loans are determined in consideration of market interest rates.
Per-share Information
Net assets per share
Earnings per share¥1,159.58¥82.64Significant Subsequent Events(Purchase of Treasury Stock)
The Company resolved to repurchase its treasury stock under Article 156, which is applicable in accordance with
Article 165, paragraph (3) of the Companies Act, at a meeting of the Board of Directors held on April 8, 2021.
The overview is as stated in “Notes to the Consolidated Financial Statements; Significant Subsequent Events.”- 33 -