Sun Frontier Fudousan Co., Ltd.

Consolidated Financial Statements for
the Third Quarter of Fiscal Year ending March 2021

We are aiming to be the real estate company of the world’s most
loved, trusted and selected by clients.

1) Overview of the 3Q Results of FY ending March 2021

1-102) Impact of the Spread of the new coronavirus (COVID-19)
Infection and Immediate Management Policy

11-153) With/Post COVID-19 Initiatives4) ESG Initiatives

16-31

February 9, 2020

32-40

Stock Code: 8934
5) Company Information and Reference Materials

41-46Performance Summary of 3Q of FY ending March 2021
Operating Profit and Ordinary Profit exceeded plans. Sales of RP and Hotel Business properties
are performing well.
(Unit: 1 million yen)
Results
Net Sales
Operating
ProfitOrdinary
ProfitProfit*Profit Margin

Year-on-Year

Growth Rate

Full-year Forecast

Progression
Rate

46,442―-8,188-15.0%

70,000

66.3%

7,032

15.1%

-6,527-48.1%

6,930

101.5%

6,562

14.1%

-6,735-50.6%

6,500

101.0%

4,059

8.7%

-4,917-54.8%

4,100

99.0%

*”Profit” represents net income attributable to shareholders of the parent company.

Topics.

2) Sales and profits of Hotel Development Business and Overseas
Businesses supported results

1) Solid performance in RP Business drove companywide results• The number of sales in RP Business was 18, and the segment
profit ratio remained high (25.2%, -8.1%pt year on year). The
solid performance drove the companywide performance even in
the COVID-19 outbreak. However, sales and profits fell sharply
year on year, partly due to a reactionary fall from the previous
fiscal year.
• In such circumstances, when developing new products we willcontinue to aim creating offices that are selected by clients inthis new world based on new values by capturing changes ofoffices, towns, way of working by grasping client needs when weinteract with clients.
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

※Both operating profit as well as ordinary profit exceeded the earnings
forecasts and has been performing well also. At present, there is no change
in the earnings forecast, but we will promptly announce if we determine that
it is necessary to be revised due to future progress.

• In the Hotel Development Business the HIYORI OCEAN RESORTOKINAWA was completed in December as part of a development
PJ in Onna Village, Okinawa Prefecture. Delivery is being done
and during this period 126 plots has been delivered and posted
about 1.5 billion segment profit. Operation division is still having
a hard time, but lot sales are going well.
• In Overseas Business, all the delivery of Hiyori Garden Tower, acondominium development project in Danang, Vietnam, wascompleted. Sales and profits increased significantly andcontributed to companywide results.

1

Sun Frontier Fudousan Co., Ltd.

Consolidated Income Statement
Income Statement Points（Unit： 1 million yen）
FY ended
2020年3月期
March 2020
April
- December
4-12月期Net Sales
売上高54,631
54,631
不動産再生事業45,13145,131
Real Estate Revitalization Business
Replanning
Business
リプランニング（含ホテル開発）
42,29942,299(including Hotel Development)
賃貸ビル・サブリース
2,832
2,832
RentalBuilding and Sublease
2,566
不動産サービス事業
2,566
Real Estate Service Business
Operation Business
4,335
オペレーション事業
4,335
Other Business
3,574
その他事業
3,574
Adjustment
-976
調整額
▲976
Gross Profit
売上総利益19,132
19,132
不動産再生事業
16,223
16,223
Real Estate Revitalization Business
Replanning
Business
リプランニング（含ホテル開発）
15,08615,086(including Hotel Development)
賃貸ビル・サブリース
1,136
1,136
Rental Building and Sublease
1,646
不動産サービス事業
1,646
Real Estate Service Business
Operation Business
310
オペレーション事業
310
Other
Business
1,066
その他事業
1,066
Adjustment
-113
調整額
▲113
Selling, general and administrative expenses 5,572
販売費及び一般管理費
5,572
Operating Profit
営業利益13,56013,560Non-operating
Income
231
営業外収益
231
Non-operating
Expenses
494
営業外費用
494
経常利益
13,297
13,297
Ordinary Profit
特別損益3
Extraordinary
Income and Losses
4,329
法人税等
4,329
IncomeTaxProfitAttributable to Non-controlling Interests4
非支配株主損益
8,976
Profit8,976
純利益

FY ended
2021年3月期
March 2021
April
- December
4-12月期

Increase/
前年増減率
Decrease

46,442
46,442
37,957
37,95735,40635,406
2,550
2,550
2,562
2,562
2,383
2,383
4,208
4,208
▲-669
669
12,421
12,421
10,366
10,366
9,645
9,645
721
721
1,668
1,668
▲-752
752
1,311
1,311
▲-171
171
5,389
5,389
7,032
7,032
126
126
596
596
6,562
6,562
▲-8
8
2,526
2,526
31
31
4,059
4,059

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

▲15.0%-15.0%▲15.9%-15.9%▲16.3%-16.3%▲10.0%-10.0%-0.2%▲0.2%-45.0%▲45.0%
17.7%
17.7%
―
▲35.1%-35.1%▲36.1%-36.1%▲36.1%-36.1%▲36.5%-36.5%
1.3%
1.3%
―
23.0%
23.0%
―
▲3.3%
-3.3%
▲48.1%-48.1%-45.5%▲45.5%
20.6%
20.6%▲50.6%-50.6%―-41.6%▲41.6%
675.0%
675.0%-54.8%▲54.8%<RP Business>
Although number of sales decreased in RP Business year on year, sales areprogressing steadily even in the current situation with the outbreak of the
COVID-19. With Hotel Development Business, the sales of HIYORI OCEANRESORT OKINAWA has been added. As a result, in RP Business sales were
down to 37.9 billion (down 16% year on year) and gross profit fell to 10.3
billion (down 36% year on year), but gross profit ratio was 27.3% and kept
a level exceeding the full-year forecast rate (19.1%).

<Operation Business>
Hotel Operation Business suffered a decline in performance. Although
there were signs of recovery in 3Q, performance declined again due to thesuspension of the GoTo Travel campaign towards the end of the year.
Conference Room Rental Business has been having a hard time too, but
secured profit. As a result, in Operation Business sales were down to ¥2.3
million (down 45% year on year) and posted a loss of approximately ¥0.75
billion.
<Other Businesses>
In Overseas Business the delivery of condominiums for sale was completed.
As a result, sales of Other Businesses increased to ¥4.2 billion (up 18% year
on year) and gross profit increased greatly to approximately ¥1.3 billion (up
23% year on year). Profit ratio exceeded the full-year forecast rate (29%) andwas 31%.

2

Sun Frontier Fudousan Co., Ltd.

Consolidated Balance Sheet - Assets <Inventories> decreased by ¥5.9 billion due to the sale of properties. Among them ¥3.1 billion decreased in RP business projects, ¥0.9 billion
decreased in hotel projects although there was progress of construction due to the delivery of HIYORI OCEAN RESORT OKINAWA
started, and ¥1.9 billion decreased in overseas projects due to the delivery of HIYORI Garden Tower and other factors.
<Cash and time deposits > increased by ¥1.2 billion due to the sale of RP properties and overseas projects, as well as borrowings fromfinancial institutions.

FY ended March 2019

FY ended March 2020

FY ending March 2021
As of End of
December 2020

Current Assets

97,149113,842

108,495▲5,347

Cash and time deposits

20,257

18,627

19,860+1,232Inventories

74,32991,76685,776-5, 989

Breakdown） RP

62,14371,353

68,201-3,152

Hotel

7,552

17,01916,086-933

Overseas, etc.

4,634

3,395

1,490

-1,905

2,562

3,448

2,858

-590

Non-current Assets

13,74916,45016,457+6

Property, Plant and Equipment

9,339

10,413

10,465

+51

863

712

599

-113

3,546

5,324

5,392

+68

110,898

130,293

124,952-5,340（Unit: 1 million yen）

Other Current Assets

Intangible Assets
Investments and Other Assets

Total Assets

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

3

Increase/Decrease(Compared to End of
March 2020）

Sun Frontier Fudousan Co., Ltd.

Consolidated Balance Sheet - Liabilities/Equity <Interest-bearing Debt>
decreased by approximately ¥5.3 billion from the end of the previous fiscal
year to ¥44.0 billion due to the sale of properties and other factors.
<Net Assets>
increased by ¥4.8 billion due to profit (¥4.0 billion) and the issuance ofpreferred stock of subsidiaries (¥3.0 billion), despite the payment of dividends
in the previous fiscal year (¥2.0 billion).

（Unit: 1 million yen）

FY ended
March 2019

Current Liabilities

Change in Equity Ratio
End of March2019

End of March
2020

End of Dec.
2020

50.3%

49.6%

53.2%

FY endingMarch 2021
As of end of December
2020

FY ended
March 2020

Increase/Decrease(Compared to end of
March 2020）

12,85918,052

14,546-3,505

Short-term Borrowings, etc.

2,248

4,463

5,368

+905

Income Taxes Payable, etc.

2,661

3,566

611

-2,954

Other Current Liabilities

7,949

10,022

8,566-1,456

Non-current Liabilities

42,17947,43140,748-6,682Long-term Borrowings and Bonds Payable

39,75144,906

38,660-6,245

Other Non-current Liabilities

2,428

2,525

2,088

-437

Total Liabilities

55,03865,48355,295-10,188

55,90064,69066,701+2,011

-40

119

2,955

+2,836

Total Net Assets

55,86064,80969,656+4,847

Total Liabilities and Net Assets

110,898

130,293

124,952-5,340Shareholders’ Equity
OthersCopyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

4

Sun Frontier Fudousan Co., Ltd.

Operating Results by Business Segment

Replanning Business (Replanning (RP)/ Hotel Development)◼ The number of buildings sold was 18 cases and decreased significantly from theprevious period (33 cases) due to the impact of the spread of the COVID-19 andbecause the sale of properties in the previous period went well.
◼ We posted a decrease (0.24 billion) in evaluation regarding RP business-related
properties overseas (NY)◼ The average RP Business period was 490 days (+81 days from the previous year). The
business period has been extended due to efforts to commercialize buildings to raise
their rent levels, but a high profit margin on sales was maintained.
◼ In the Hotel Development Business HIYORI OCEAN RESORT OKINAWA was completed in
December. We posted a segment profit of 1.5 billion (profit margin 20.9%) which
contributed to results.
◼ The number of properties in year-end inventory was 63 (52 RP Business-related
properties and 11 Hotel Business-related properties).
(Unit: 1 million yen)

FY ended
March 2020
Apr. to Dec.
42,29942,268FY ended March
2021
Apr. to Dec.
35,40927,97430
13,924
14,053

Increase/
Decrease(1 million yen)

45,00030,00025,000+246.7%-38.2%-49.9%

15,000

-128
32.9%
33.2%

1,553
24.3%
25.2%

ー
-8.6%pt-8.1%pt

Number of Items Purchasedー
34 casesー-21 cases

Number of Properties Sold

33 cases

20.9%
13 cases
18 cases*Including 1 case of
primary composition-15 cases

72 cases (Note 2)

63 cases (Note 2)-9 cases

Segment Profit (Note 1)
Replanning Business
Hotel Development BusinessProfit Margin
Replanning Business
Hotel Development Business

Number of Stocks at the End of
Fiscal Year

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

5

40%

32.9%
30%

7,432
8,599
7,045

Hotel Development Business

50%

35,40935,00020,000Replanning Business

60%

42,29940,000-16.3%-33.8%Net Sales

Net Sales
Segment Profit
Profit Margin

24.3%
13,92420%

8,599

10,000

10%
5,000
0

0%
FY ended March 2020
Apr. to Dec.

FY ended March 2021
Apr. to Dec.

(Note 1) “Segment Profit” is calculated by deducting specific costs of eachsegment, including interest expenses, sales commission and goodwill
depreciation expense from gross profit.
(Note 2) Projects of land purchase and development are included in RP inventory.

Sun Frontier Fudousan Co., Ltd.

Operating Results by Business Segment

Rental Building Business (Rental Buildings/ Sub-leases)(1 million yen)

◼ There was steady progress in attracting tenants to RP inventory

3,000

Net Sales
Segment Profit
Profit Margin

60%

2,832

properties and Sublease Business, but net sales, segment profit, and2,547

profit margin decreased due to rent exemption due to temporary

2,500

closure of some hotels and decline in occupancy rate.

50%

40.2%
2,000

40%

26.4%

1,500
FY ended
March 2020
Apr. to Dec.

FY ended
March 2021
Apr. to Dec.

Net Sales

2,832

2,547

-10.1%

Segment Profit

1,137

672

-40.9%

Profit Margin

40.2%

26.4%

-13.8%pt(Unit: 1 million yen)

Increase/
Decrease

1,137
1,000

20%

672
500

10%

0

0%
FY ended March 2020
Apr. to Dec.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

630%

FY ended March 2021
Apr. to Dec.

Sun Frontier Fudousan Co., Ltd.

Operating Results by Business Segment

Real Estate Service Business(Property Management/ Building
Maintenance/ Brokerage/ Leasing)<PM and BM Businesses>◼ In PM Business, the number of PM managing buildings significantly
increased, resulting in higher sales and profits. In BM Business, sales andprofits decreased due to a decrease in revenue from RP properties.

(1 million yen)

3,000

Net Sales
Segment Profit
Profit Margin
100%[Number of PM Managing Buildings and Occupancy Rate][Number of Managing Buildings]

End of Dec. 2018
End of Dec. 2019
End of Dec. 2020

[Occupancy Rate]

377 buildings
391 buildings
404 buildings

97.8%
98.4%
95.7%

2,500

<Brokerage and Leasing>◼ Sales and profits increased significantly due to a steady accumulation ofproject contracts in cooperation with other departments. Although rental
brokerage contributed to the commercialization of RP properties, sales andprofits decreased due to a decrease in contracts for external properties dueto the impact of the COVID-19 outbreak.

2,000

2,562

2,566

80%
64.1%
1,646

64.9%
1,664

60%

1,500
40%

(Unit: 1 million yen)

FY ended
March 2020
Apr. to Dec.

FY ended
March 2021
Apr. to Dec.

1,000

Increase/
Decrease

Net Sales

2,566

2,562

-0.2%

Segment Profit

1,646

1,664

+1.1%

Profit Margin

64.1%

64.9%

+0.8%pt

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

7

20%

500

0

0%
FY ended March 2020
Apr. to Dec.

FY ended March 2021
Apr. to Dec.

Sun Frontier Fudousan Co., Ltd.

Operating Results by Business Segment

Operation Business（Hotel Operation and Conference Room Rental Business）<Hotel Operation Business >◼ 7 hotels were temporarily closed in 1Q. From 2Q to 3Q, the performances of(1 million yen)
hotels in local areas recovered. Large cities hotels such as Osaka and Ginza
continue to struggle to recover. Moreover, numbers were stagnant towards the
5,000
end of the year due to the nationwide suspension of the GoTo Travel campaign.
We posted a large decline in revenue and a loss for the period.

Net Sales
Segment Profit
Profit Margin

40%

4,335

4,000

<Conference Room Rental Business>◼ Secured a profit by starting new services that answers to client demands forspace, taking measures to prevent infectious diseases, and deploying online
facilities.

30%

3,000
20%

2,383
FY ended
March 2020
Apr. to Dec.

FY endingMarch 2021
Apr. to Dec.

4,335

2,383

3,346

1,472

-56.0%

Conference Room Rental Business

989

911

-7.9%

Segment Profit

178

-797

―

-4

-927

―

182

130

-28.7%

4.1%

－

―

―

―

― -2,000

18.5%

14.3%

(Unit: 1 million yen)

Net Sales
Hotel Operation Business

Hotel Operation Business
Conference Room Rental BusinessProfit Margin
Hotel Operation Business
Conference Room Rental Business

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

2,000

Increase/
Decrease10%-45.0% 1,000-4.2%pt

8

4.1%
178

0%

0
-10%

-1,000▲ 797-20%

FY ended March 2020
Apr. to Dec.

FY ended March 2021
Apr. to Dec.

Sun Frontier Fudousan Co., Ltd.

Operating Results by Business Segment

Others (Rent Guarantee, Construction and Overseas Business, etc.)<Rent Guarantee Business>◼ The number of consultations from building owners has increased due toincreased vacancies, concerns about tenant credit, and switching frompersonal guarantees. Number of guarantees remained strong and as a result,sales and profits increased.

(1 million yen)

4,500
4,208

50%

3,574
3,500

<Overseas Business>◼ Delivery of the condominium "HIYORI Garden Tower" in Da Nang completed.
This period’s sales with the PJ alone was 2.5 billion, segment profit was 0.62
billion and contributed to increase of sales and profits in the Overseas
Business.

3,000

40%

2,500
2,000

30.2%

FY endingMarch 2021
Apr. to Dec.

3,574

4,208

+17.7%

500

Segment Profit

882

1,272

+44.2%

0

Profit Margin

24.7%

30.2%

+5.5%pt

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

9

Increase/
Decrease

1,000

30%

24.7%

1,500

FY ended
March 2020
Apr. to Dec.

Net Sales

60%

4,000

<Construction Business>◼ Sales and profits decreased due to a decrease in SF engineering large-scaleconstruction orders from the previous year.

Unit: 1 million yen)

Net Sales
Segment Profit
Profit Margin

1,272

20%

882
10%

0%
FY ended March 2020
Apr. to Dec.

FY ended March 2021
Apr. to Dec.

Sun Frontier Fudousan Co., Ltd.

Trends in Key Management Indicator■Changes in Ordinary Profit Margin(1 million yen)

80,000(1 million yen)

自己資本比率（右軸）Equity Ratio (R axis)

22.0%

22.0%

70%

full-year forecast

22.7%

80%
Net Assets (L axis)
純資産（左軸）

24.0%
22.9%

(Building a Stable Financial Base)

70,00030%

Profit (L axis)
売上高（左軸）経常利益（左軸）
Ordinary Profit (L axis)
経常利益率（右軸）
Recurring Profit Margin (R axis)

70,00060,000■Changes in Equity Ratio(Pursuing High-Value-Added Management)

60,000

25%

55.7%

56.0%

53.2%
50.3%

50,000

20%

53.2%

50%

50,00049.6%

14.1%
40,00015%

40,00010%

30,00040%

30%

30,000full-year forecast

20,00010,000060%

2016/32017/3

2018/3

2019/32020/32021/32020/12

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

20%
5%

20,00010%

0%10,00010

2016/32017/3

2018/3

2019/32020/32021/32020/120%Sun Frontier Fudousan Co., Ltd.

2) Impact of the Spread of the new coronavirus(COVID-19) Infection and Immediate
Management Policy

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

11

Sun Frontier Fudousan Co., Ltd.

Impact on Main Business and Recent Movements
Business

・Office Building

Business

Impacts➢ With the low interest rates institutional investors’ motivation to invest is still strong.
➢ The occupancy rate at buildings managed by the Company was 95.7% at the end of
December, down about 1% from 96.8% at the end of September, mainly due to decline inbusiness and the downsizing of offices through the introduction of remote work. Recently,
there was an increase in cancellation of offices rather than stores and downward pressure
is getting stronger. With the declaration of the emergency situation again in January,
requests for rent reductions from stores, that has thought to have stabilized, areincreasing again. An unpredictable business environment continues.
➢ Office rents did not experience an extreme decline but were on a downward trend with
the increase in vacancies. An increase in vacancies is noticeable in large buildings andbuildings whose competitiveness declined due to aging.
➢ Lease contracts at RP properties have been steady. Main reasons for relocating offices
used to be new establishments and floor space , but currently relocations due todownsizing and cost cutting has been increasing.
➢ Depending on industry, not all are having a difficult time. There are cases where ITrelated industries and nest-dweller consumption industry improve their sales andincrease their floor space.
➢ In Rent Guarantee Business, the number of delinquent payments, which had increased, ison a downward trend due to policies of financial support for companies . In the current
outbreak of the COVID-19, rent guarantee is attracting attention among building owners.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

12

Sun Frontier Fudousan Co., Ltd.

Impact on Main Business and Recent Movements••

Business

Impacts

Conference Room
Rental Business➢ Client needs have changed. There is an increasing need for facilities to support online delivery.
Fusion is advancing such as using online or in person depending on training content➢ Even when the COVID-19 outbreak is under control in the future, the overall volume is notexpected to return to the previous level. On the other hand, the demand for flexible space
appears to be growing➢ Since the declaration of a state of emergency was made again, there was an increase of“refraining from reserving” and “postponing decision,” but there seems to be movement headed
for the beginning of spring with the movement of big recruiting companies.
➢ Over-supply caused successive disappearances or withdrawals of rental conference room andshared office providers.

Hotel Operation
Business➢ In early Autumn, the performance of hotels in local areas recovered. Hotels in major cities
struggled.
➢ Unit price and operation rate went down due to the nationwide suspension of the GoTo Travel
campaign in December.
In addition, a tough environment continues with the declaration of a state of emergency again in
January.
➢ In various companies, there are active actions that promote the use of workcation and telework.
➢ Recently, advance reservation has been piling up in hotels of local areas. Moreover, even in the
hotels in the cities that has been struggling has started to receive advance reservation too.

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13

Sun Frontier Fudousan Co., Ltd.

Business Environment Awareness◆ The Japanese economy has been severely affected by the spread of COVID-19 infection, and it will take some time
to recover.
◆ The third wave of infection happened and a declaration for a state of emergency was made. The economic stagnation appears likely
to be prolonged.
◆ Until the vaccine is widespread in the world, economic activities will continue to be unstable under the new lifestyle with COVID-19.
◆ In December foreign visitors to Japan have virtually disappeared (decreased by 97.7% from the same month in the previous year). The
aviation and tourism industries are facing a predicament.

2.

The world economy seemed to be recovering from its deceleration, but lateness in even distribution of thevaccine can be a risk.

◆ The IMF expects the global economy ‘s growth rate in year 2021 to become +5.5% from last year’s negative growth. The risk is latenessin widespread distribution of the vaccine.
◆ The COVID-19 outbreak has further accelerated “compressed changes” in the digitalization of society.
◆ Europe was able to get out of their second wave of infection. Biden was chosen as the new President of the United States andinternational cooperation will be promoted.

3.

The office building market in central Tokyo has peaked out due to COVID-19 infection and both vacancy rates andrent has become worse.

◆ Vacancy rates have risen due to business downsizing and job losses caused by the recession, and rent levels are declining.
◆ Office demand is declining due in part to the downsizing of offices due to the penetration of remote work.
◆ Demands towards offices has changed with the outbreak of the COVID-19, such as a more flexible type of contract and being equippedwith IT facilities.
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

14

Sun Frontier Fudousan Co., Ltd.

Immediate Management Policy① Prevent the Spread of COVID-19 Infection

Three
Policies② Maintain and Continue Business③ Concentrate Resources on our Main
Business “Revitalization and Utilization of Real
Estate"Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

15

Sun Frontier Fudousan Co., Ltd.

3) With/Post COVID-19 Initiatives～ 4 growth strategies ～

1.
2.
3.
4.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Expansion of Main Business
Hotel Business
Overseas Development
M&A

16

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business - Business Model of Office Building Business -We reflect client’s demands in development of products
and create products with high added value
By internalizing purchasing, development, promotion of occupancy, sales, and support, we cangrasp client's intentions in detail, and utilize them for the improvement of new products.

Real Estate Utilization
To be a partner to solve difficulties from our clients’point of view

Funding Advice

Asset Consulting

Rent Guarantee

Construction Planning

Property Management

Leasing

Brokerage
Property
purchase②
Real Estate
Revitalization
Building
development ofvalue chain

Property
sales

Clients (Building owners, Asset holders and Wealthy individuals)① In vertical real estate utilization business, we survey and solve difficulties on site by listening to our clients’ problems.
② In horizontal real estate revitalization business, We reflect the knowledge and needs of asset value improvement in
the revitalized buildings to increase the value and sell them.
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17

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business - Offices and Ways of Working in the COVID-19 Outbreak -Creating a richer way of working and a new way of ideal offices
We pursue flexible and creative office utilization that is not bound by old customs and common
sense, and propose it to society.

◆“WEEK”~ New idea to lease our designed set-up shared office
on a certain day of the week ~https://week-office.com/◆Art X Office~ Creative Art Office to Choose a Room with Art (Mural) ~https://a.yotsuya-office.jp/
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

18

Sun Frontier Fudousan Co., Ltd.

～THE WAVES AKIHABARA～

1. Expansion of Main Business -The Ideal New Office-“Make everyday a good workday.” Revitalize offices to make“working enjoyable”
This project aims to create a workplace that supports both
physical and mental health by providing a sense of“security” and “comfort” similar to that of a home,through the use of natural environments and antibacterial and anti-virus measures.
This is an effort to revitalize the office by making everyday
a good workday and "working enjoyable”.
[Consideration for peace of mind]
・fun and creative non-contact alcohol disinfection
fixtures・air-circulating ultraviolet purifiers・antibacterial coatings・photocatalyst coating for switches
・automatic lighting, automatic faucets
・ventilation 2 times in 1 hours, high-performance
filter ventilation equipment
Safe and secure
ventilation equipment

Bright sunlight from theveranda of the Shoji shade.

Sunken kotatsu style concentration
booth with bright light.

Elevator hall designed withmany Japanese style things.

Non-contact alcohol disinfectant
fixtures (words "thank you" come up).

Open-air rooftop gardens. Meetings formore than 10 people are possible.

Introduction of sterilization equipmentwith anti-bacterial specifications
that are gentle to the body
Bacteria
elimination &Antibacterial
Anti-virus
measures applied

Introduction of a highperformance filter ventilationequipment that ventilates 2times in 1 hours.

Instead of directly irradiating
ultraviolet rays with an ultraviolet
cleaner, the indoor air is circulatedwith a fan to maintain a clean
environment.

Antibacterial coating,photocatalyst
coating prevents
bacteria and dirt.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

19

Sun Frontier Fudousan Co., Ltd.

～THE WAVES AKIHABARA～

1. Expansion of Main Business -The Ideal New Office-“Work style close to life” office
Image of the wind going through the office[Pursuit of Office Comfort]"Space Where Natural Wind Passes By"
Creating a comfortable space where wind passes by and a space where communication
is induced with a relaxed atmosphere like being at a friend's home party.

■ Collaboration of "office and residence" functions
•
•
•
•
•
•

The dirt floor and veranda have a multi-functional creative space.
There is an entrance and you can also take your shoes off from the office
The kitchen is a place where you can enjoy your favorite homemade dishes.
If you open the window, it is airy and comfortable.
You can feel the warmth of people in the space structure connected like a large hall.
The private terrace is a place where you can feel the nature and the season.

BeforeThe office is on the first floor witha “dirt floor” and “veranda”
connecting from the east side of
the building and the side facing
the road. When the window on
the entrance is fully open, natural
wind passes through the office.
You can also go with thetraditional Japanese lifestyle andtake off your shoes.

After

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

20

Sun Frontier Fudousan Co., Ltd.

～ GINZA-QUINT ～1. Expansion of Main Business -Full-scale Introduction of Anti-virus Measures in Offices-“Designing the Air” a next generation type set-up office

2.6 tsubo0.9-1.2 tsubo / person/ person(this plan)(average work area of packed offices)

The temperature is measured
with the mask on
Face authentication security
for clock in management

Air pressure control prevents
the entry of dirty air

OutsideOfficeThe ventilation efficiency isabout 4 times the legal
standard by regulating air flow
and preventing retention!

Protection against airborne
viruses with ultraviolet light

General ventilation system Replacement ventilation systemexhaustexhaust air supply
high temperature

Office layout designed to "not face each other”

It is difficult foroutside air toenter the officeretention

low temperature
air supply

AERO SHIELD■"Designing the Air“ 4 state-of-the-art facilities

Semi-circular meeting space foronline meetings and webinars

Reception lounge with
air pressure control_1 Face authentication, temperature measurement and attendance management while wearing a mask
Introduction of AI Face Authentication Security, which prevents people from entering the room if they are not wearing
a mask or are suspected of having a fever. Attendance management is also possible.
2 The virus is not brought in by pressure control
The "positive and negative pressure" system used in hospitals and food factories is used to prevent the entry of dirty
air.
_3 Air supply and exhaust"Floor blowing and displacement ventilation" used in large spaces such as movie theaters was introduced.
A system in which air supplied from the floor is smoothly discharged from the ceiling.
The ventilation effect is about 4 times that of the legal standard (0.5 times / h). The air is exchanged more than 2 times
in 1 hour and the ventilation is the same as when the window is open even in winter.
_4 Protection against floating viruses with UVThe “AERO SHIELD”, a UV irradiation device that reduces viruses by UV irradiation, will improve the air environment
by reducing viruses left in the room. As a result of the demonstration that floating bacteria decreased by 89.6% in 7
hours, the introduction of the system has started in domestic airports.
Planning and design: DRAFT Inc.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

21

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business – Conference Room Rental Business-

Flexible office that is “casual, affordable, and only what you need”
In Conference Room Rental Business, "We provide flexible offices and long-term rental
meeting rooms that provide only what is necessary at a reasonable price. Compared to anormal rental office, you can use it without being bound by the contract period, initialcost, or cost at the time of leaving.
The demand for telework, web conferences, and online seminars (webinar) is rapidly
increasing, and offices and campuses are dispersed to prevent infectious diseases. As a
new activity base, we are flexibly responding to all business situations.
Compare by costs
Restoration costs
Full cost
Brokerage commission
Guarantee company expense

1.5 months rent

Can be used a project office

Can be used as a satellite
office and training center

Restoration costs
Mainly cost for cleaning

Initial cost

Substantial
cost reduction

Advance rent
Rent for 1 to 2 months

Number of people
x unit priceDeposit and key money
2 months rent

Rental consignment
2 months rent

Security deposit
Rent for 10 to 12 months

Fixed amount in principle

Security deposit* None for most cases

Leased officeRental office

Our office

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Admission fee

22

Facilities and staff ready for online meetings
and webinar preparation

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business – Mori no Denki-

Promote ESG in office buildings
Through JAPAN ENERGY & ECOLOGY, Inc., which supports the
procurement of renewable energy, we are procuring "MihoSanrin no Mori no Denki" (Yamakita-machi, Kanagawa), which isan environmental credit derived from forests, as a new added
value in Real Estate Revitalization Business.
At present, the introduction of the system has been completed
in 2 properties, achieving 100% carbon neutral.
As a result, the companies living in the property will be able toreport that their CO2 emissions are 0 and that they use
electricity from forests as part of their business activities.

Emblem for properties that introduce “Mori no Denki”

Kanagawa Prefecture Miho-Sanrin no Mori no Denki
23
J Creditsales funds

Credit fundFor a sustainable way ofcreating forests!

Electric powercompany”Miho-Sanrin noMori no Denki”
Electric 100% carbon neutral
powerJAPAN ENERGY& ECOLOGY, Inc.

Sun Frontier’s
revitalized building

Support for forest conservation

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

23

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business – Deepening and Expanding Office Building Business in Central Tokyo-

Focusing on the central Tokyo area and small and medium-sized officebuildings, finding new work styles
We specialize in business areas where we can exert our influence, continue to pursue and refine theexpertise of existing businesses based on client feedback, and maximize real estate value.
Expand, strengthen, and differentiate high-profit businesses through cross-business collaborationand chain initiatives.
Day
Offices
Securitiza

Early stage ofestablishment

RentalSecuritiza Replanning

OfficeBuilding
Building Business inCentral Tokyo

RentalBuilding
PM

OfficeBuilding
Business inCentral Tokyo

Brokerage

Sub
Leasing

Brokerage

PM
Sub

Replanning
Construc-tion

RentalConference
Room

OfficeBuilding
Business inCentral TokyoBM

Leasing
Leasing

AssetsConsulting

Rent
Guarantee

PM

Rent
Guarantee

Leasing

Flexible
OfficeBacteria
Elimination
andAntibacterial
OfficeOfficeClose toEveryday
Life…

Leasing

Building

Construction-tion ofReal
EstateBrokerage

Rental-tion ofReal
EstateArt Office

the IT. We will expand our business area of small and medium sized office buildings in central Tokyo.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

24…

⇒ We will expand our existing business further and will challenge new fields of business by utilizing M&A,

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business - Leasing Business -Our strengths are the ability to propose the value of utilizing offices and to promote
occupancy from users' perspective
1. We specialize in small and medium-sized officebuildings in central Tokyo.
We have a branch network in the center of the citywith close connections to local communities.
Our strength is to propose the optimal utilization
value of small and medium-sized offices, which is
our specialty, and to guide and mediate tenants.

Ueno
Akihabara

Ikebukuro
Kudan

Kodenma-cho

Kanda

Nihonbashi

ShinjukuTokyo

Kojimachi

2. We extend to our clients unfailing courtesy andbecome “a real estate company closest to clients.”
We are their trustworthy point of contact to consult
and solve any of their problems.

ShibuyaHibiyaHead Office

Akasaka

Ginza

AoyamaToranomon

Shimbashi

Ebisu

3. We actively utilize digital marketing to strengthen
our ability to appeal to a wide range of users.
We propose the value of offices to a wide range ofusers by utilizing furnished offices and online
viewing.

MeguroGotandaShinagawaare branches.

4. As a source of added value creation in the Real
Estate Revitalization Business, we will grasp theneeds of tenants, constantly change our Company byrelying on the voices of tenants, and create offices
where tenants can grow and move in easily.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Hamamatsu-cho

25

Yokohama

Sun Frontier Fudousan Co., Ltd.

1. Expansion of Main Business - Property Management Business -With the experience and organizational strength we have cultivated,
we will respond to the COVID-19 outbreak and expand contracts （㎡）
100%

98%

900,000

Entrusted floor area (Right Axis)
Occupancy rate of entrusted assets (Left Axis)
Occupancy rate in 23 wards of Tokyo (Left Axis)

Operating rate of our PM
entrusted properties*Note1

800,000

700,000

96%

96.3％

94%

600,000(As of Jan, 1, 2021)

95.7％

92%

500,000(As of the end of Dec. 2020)

Average occupancy rate of medium-sizedbuildings in 23 wards in Tokyo *Note 290%400,000

300,000

88%
Our strength is the ability to maintain tenant occupancy rates
above the market average even during the recession, as seen
during the period of 2011-2014 when the market occupancy
rate deteriorated.

86%

84%

1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q…
…
…

March 2009 March 2010 March 2011 March 2012 March 2013 March 2014 March 2015 March 2016 March 2017 March 2018

200,000

100,000

0March 2019 March 2020 March 2021

*Note1: Operating rate: (Total operating area)/(Total lent available area).
*Note2: Our research based on “Monthly Office Market Research Report” by Sanko Estate Co., Ltd.,
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

26

Sun Frontier Fudousan Co., Ltd.

2. Hotel Business - Onna, Okinawa -“HIYORI OCEAN RESORT OKINAWA” PRE-OPENING (SCHEDULED) ON FEBRUARY 20
The building was completed in December and the finished delivery of 126 lots contributed to theCompany’s results. Delivery of 140 lots completed as of the end of January.
Infinity terrace

Hotel Appearance

Entrance

Hotel Appearance (at night)

You can view thecompleted hotel here

Terrace where guest can enjoy ameal while looking out at the sunset
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

27

Sun Frontier Fudousan Co., Ltd.

2. Hotel Business - List of hotels under operation and development -Showed signs of recovery starting from Autumn, but continues to be stagnant
after the declaration of an emergency situation
Many hotels have been on a recovery track since autumn thanks to cost-cutting
efforts and GoTo Travel campaign, but they have been stagnant since the January
declaration of an emergency situation.
Until the declaration is lifted, costs for existing hotels will be restrained and new
development projects will be postponed.

Hotel Name Location

StatusNo. ofRooms

In operation

SSH Nagoya Tokoname

194

In operation

Hiyori Hotel Maihama

80

In operation

Hiyori Hotel Osaka Namba Station

224

In operation

Hiyori Hotel Tokyo Ginza EAST

135

In operation

Tabino Hotel Hida Takayama

80

Running or Leasing

In operating

15 hotels

Under construction

5 hotels

In operation

Tabino Hotel Sado

111

Total number of rooms 3,130 rooms

In operation

Tabino Hotel Kurashiki Mizushima

155

In operation

Tabino Hotel Kashima

194

In operation

Sky Heart Hotel Kawasaki

200

In operation

Sky Heart Hotel Koiwa

105

MatsumotoIn operation

Sky Heart Hotel Narita

100

Kashima

In operation

Sky Heart Hotel Hakata

159

In operation

Sky Heart Hotel Shimonoseki

105

In operation

Courtyard by Marriott Osaka Honmachi

193

In operation

Sado Resort Hotel Azuma

57

RentingToyama210

Completed

Onna, Okinawa

204

Under construction

Kyoto Nijo Kawaramachi

203

Under construction

Miyako-Island

111

Under construction

Kyoto Shijo Kawaramachi

134

Under construction

Matsumoto

176

Under construction or Planning*As of February 9, 2021

Sado (Chigusa)
Sado (Azuma)
ToyamaTakayama

Onna, Okinawa

Kyoto Nijo

Maihama

Kyoto Shijo
MiyakoIslandNaritaKoiwa

Shimonoseki

Ginza

Tokoname
HakataOsaka Honmachi

Kawasaki
Kurashiki
Osaka Namba Ekimae
Mizushima*The schedule, hotel scale and others are based on the current plan, which may change in the future.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

28

Sun Frontier Fudousan Co., Ltd.

3. Overseas Business - Da Nang, Vietnam -We concentrate on the condominium business in Da Nang
<Philosophy of Overseas Business:“Providing comfort to the people of Asia, together with our partners.” >Providing high-quality housing, mainly in Southeast Asia, through high-quality and planning using Japan’s advanced construction
technology, in which Asian people can experience Japanese quality. We will contribute to the economic development in the region
by meeting the growing demand for housing there.

A View overlooking the city

It was completed in December 2019, and all houses were delivered as of the end of
September 2020.
Deliveries from January 2020 contributed to results for the year ending March 2021.
In Da Nang, we will concentrate on the condominium business, and through development
and building management services, we will nurture the HIYORI brand into a brand that isappreciated and loved by the citizens.
In Vietnam, COVID-19 infection was confirmed for the first time in 56 days in January, but
the spread of the infection has been suppressed. Travel from Japan to Da Nang is restricted.
Entry from abroad remains limited.
High-rise condominium “HIYORI Garden Tower”

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

29

Sun Frontier Fudousan Co., Ltd.

4. M&A

Expansion of Existing Businesses and Start-up Investments
We will welcome human resources, technologies, and platforms in our businessto the Group to expand and optimize services in response to the changing
environment and accelerate the growth of peripheral businesses.
<Achievements of M&A and Capital Alliances>Year

Company Name and Business NameBusiness Overview

1

2010

Sonomanma Office!

Website Specializing in Set-up Offices

2

2012

Yubi (Currently SF Building Maintenance)

Building MaintenanceVision Center and Vision OfficeRental Conference Rooms and Rental
Offices

Hotel AU Tokoname(Currently Spring Sunny Hotel Nagoya Tokoname Station)

Hotel

Sky Court Hotel(Currently Sky Heart Hotel)

Hotel

Sado Resort Hotel Azuma

Japanese-style Inn with a long History(Sado Island)

VIP Nangoku(Currently Sky Heart Hotel Shimonoseki)

Hotel

Okesa Kanko Taxi

Taxi and Tourist Bus (Sado Island)

Kouwa Corporation(Currently SF Engineering)Interior Finishing Work for Offices,
etc.

Sado Biyori

Sado Island Information Website

SKY ESTATE

Drone Business

3
4
5

6
7
8

9
10
11
12

2016

2018

2019

2021

Nihon System Service

New

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Building Maintenance30

Sun Frontier Fudousan Co., Ltd.

4. M&A – Expansion of Existing Business -Nihon System Service becomes a wholly owned subsidiary
Through SF Building Maintenance Inc. (a subsidiary of the Company, hereinafter called SF Bldg.
Main.) Nihon System Service Co., Ltd., which operates a cleaning business for buildings, became
a wholly owned subsidiary.
Since its establishment in 1979, Nihon System Service Co., Ltd. has a long track record of cleaning 442 buildings in central Tokyo, mainly in the 5wards (Chiyoda, Chuo, Minato, Shinjuku and Shibuya).
In addition, Nihon System Service Co., Ltd. has a high affinity with SF Bldg. Main.’s business, has strengthened its base in the western area ofcentral Tokyo (Minato Ward, Shibuya Ward, Shinjuku Ward) where SF Bldg. Main. is comparatively less entrusted with, and together with SF
Bldg. Main. has undertaken the cleaning of approximately a total of 1,000 buildings.
We will expand our business base in the central Tokyo cleaning business and seek further synergies with other businesses.

IbarakiPrefect.

SaitamaPrefect.
Itabashi
Ward

Kita
Ward

Corporate Profile

Adachi
Ward◼ Company name: Nihon System Service Co., Ltd.

Katsushika
WardArakawa
Ward
Toshima
Ward Bunkyo Taito
NakanoSumidaWard Ward Ward
Suginami Ward Shinjuku
Edogawa
Ward
Ward Chiyoda
Ward
Ward
Shibuya
Chuo Koto
Ward
Ward Ward
MinatoSetagaya
Ward
Ward
MeguroChiba
Ward
Prefect.
Shinagawa
Ward

NerimaWard

Kanagawa
Prefect.

Ota
Ward◼ Address : 2-13-23 Akasaka, Minato-ku, Tokyo◼ Main business : Cleaning business mainly for
office buildings◼ Share capital : 10,000,000 yen (100% investment
by SF Building Maintenance Inc. )Keeping the building
beautiful with highpressure cleaning◼ Establishment : June 1979

Expansion of business base in 5 wards ofcentral Tokyo

31
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Sun Frontier Fudousan Co., Ltd.

4) ESG Initiatives

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32

Sun Frontier Fudousan Co., Ltd.

Sun Frontier, a Company of Philosophy-oriented management
Company policy
Altruism

Management Philosophy
With a vision to secure all employees and to pursue both spiritual and material happiness,at the same time, we will contribute to the prosperity of humankind and society with aspirit of symbiosis.

Corporate Philosophy
We, the employees through our business improve our knowledge, technical skills andpersonalities with our strong enthusiasm and dedicate ourselves to utilization anddistribution of real estate stock, thereby we reduce the waste of non-reproducible
resources and contribute to permanent prosperities of mankind, flora and fauna on theearth.
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33

Sun Frontier Fudousan Co., Ltd.

Outlines of our ESG Initiatives
Through our initiatives heavily based on the viewpoints of ESG, we will achieve
our sustainable growth and a long-term improvement in our corporate value.

Environment

SocialGovernance We revitalize buildings without destroying them. We develop the Real Estate Revitalization Business, which
grows in harmony with the environment (revitalized buildings: 417 buildings.)
 We operate a circulation market of furnished offices with an aim to reduce waste materials generated by
office relocation.
 We promote the reduction of energy consumption at the buildings we manage in Property Management
Business, utilizing the Energy-saving Subsidy and others.
 We have introduced the renewable electric power service to 12 buildings we own.

 Promotion of management and development of human resources in accordance with social responsibility.
Creation of a system in which diverse human resources can play active roles. (As of the end of November
2020: Female employees 35% and Foreign employees 7%)
 In our Real Estate Revitalization Businss, we promote the revitalization of buildings to meet the social needs.
 Under the slogan, “Cheer up Japan!” we develop Regional Revitalization Business from the aspect of tourism.
 We go ahead with the introduction of the drone technology to accelerate the innovation in the real estateindustry.

 When we acquire properties, we clarify their possible risks, improve their legal compliance and correct shoddy
workmanship on them through the process of commercialization and then turn the properties into a realestate stock with high social values and sell them.
 We have improved our monitoring function for the corporate management by appointing 5 independent
outside directors out of 12 directors.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

34

Sun Frontier Fudousan Co., Ltd.

ESG Initiatives

Not Scrap & Build, but a Real Estate Revitalization
Business that makes use of resources
Planning andProposal

Property purchase

Renovation

Tenant mediation

Sales

Management afterEquipment, interior,entrance, common space,exterior wall, greening, andCreate a high added value
through cross- businesscollaboration and linkagesuch
A motivating space for employees

Gross profit
0.3 billion yen(profit margin 25%)

Sales

Purchase
E.g. a building around 25
Manageyears oldment
Construction

Brokerage

Construction fee
0.15 billion yen

LeasingBM

Renewed sink area for women’s convenience

Purchase price
1 billion yen
occupancy rate 50%
rent income
40 million yen

Purchase
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Acquisition cost
0.05 billion yen
Purchase price 1 billion yen

occupancy rate 100％rent income
80 million yen

Created a terrace with greenery on the roof

35

E.g. Sell for 1.5 billion yen
Sun Frontier Fudousan Co., Ltd.

ESG Initiatives

Estimation of Environmental Contribution

Real Estate Revitalization Business that conserves limited resources and coexists
with the environment [E]●Comparison of resource inputs over 50 year
40.9% reduction
156

Renovation Plan

2,104

Rebuilding Plan

2,030
0

500

97
1,725

1,000

1,500

2,000

2,500

150

3,000

3,500

85

4,000
kg/㎡

●Comparison of waste generation over 50 year

49.3% reduction
Renovation Plan

162

50

Rebuilding Plan

84

110
246

323
0

New Building
新築

100

200

Rebuilding
建替

300

Repair
修繕

400

Renovation
改修

500

89

53

600

700

Demolition
解体

Standard*

893

480

1,711
0

New
Building
New Building
新築

1,000

修繕

Repair

703

458

463

249

2,000

改修

Renovation*Architectural Institute of Japan, “LCA Tool for
Buildings Ver.5.0 - Assessment Tool for Measuresagainst Global Warming, Resource Consumption andWaste” (Japanese only)

89800

19.1% reduction

2,592

47
412

3,520

48

3,000

維持管理

Maintenance

4,000

廃棄

Abandonment

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Rebuilding: If the building is to be rebuilt every 35
years
Renovation: Revitalization of aging buildings without
demolishing them (long life buildings)
Standard: Assuming a 30-year-old unrenovatedbuilding

Estimated with the help of ERC, Inc.

kg/㎡

●Comparison of CO₂ emissions over 50 years
Renovation Plan

＜Prerequisites and Basis＞
Assuming a 30-year-old, approximately 3,000 square
meter office building. Estimating environmental
contribution over 50 years (the service life of an SRC
building) based on the Architectural Institute of Japan
LCA tool (*).

5,000

6,000

エネルギー

Energy36

7,000Compared to the proposedreconstruction and standard building◼Resource input:◼Amount of waste
generated:

1,182t reduction◼CO₂ emissions:3,660t-CO₂ reduction

4,899t reduction

kg-CO2/㎡

Sun Frontier Fudousan Co., Ltd.

ESG Initiatives

Contribute to the Revitalization of the Community and Society [S]We promote revitalization for optimal applications that meet the needs of society.
Lend buildings to companies that support all stages of life. Revitalize buildings to meet the needs of the community.

After

BeforeOriginally designed for an officeNursery school from B1 to the 4th floors, children’s facility for elementary school students on the 5th
floor, and a cancer patient support facility on the 6th floor

Industry, government, and academia work together to create a waterside space for local people to gather and relax.
BeforeAfter

The ground floor parking lot was converted to restaurants and connected to the canal side promenade.
Creating an attractive waterfront and canal view.
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

37

Sun Frontier Fudousan Co., Ltd.

ESG Initiatives

Regional Revitalization Business ~Project in progress on Sado Island [S]<We will energize Sado Island through tourism!>
When rural areas are energized, so Japan as a whole will be. As the number of visitors to Japan rapidly increases,
spurred by fascination (culture, history, nature, food, hot spring, hospitality and others) that Japan is proud of, wewill take on the challenge of regional revitalization projects that focus on the attractiveness and features uniqueto regions, in particular the regions that possess the “Wonderfulness of Japan.” The first will be Sado, where weare familiar with. We have already created jobs for over 100 employees.

Sun Frontier Sado Inc.
Hotel
Business

Transportation
Infrastructure Project

Hotel AZUMA

Okesa Kanko Taxi

Highlight Finding
Project
Anaguchi-tei(Café & Restaurant)

Tourism and Travel
Business
Happy Sado
TravelWeb Advertising
Business
Sado Biyori

DONDEN
Highland Lodge

Tabino Hotel Sado

Kigaruni Rent a Car

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Sun Frontier Fudousan Co., Ltd.

ESG initiatives

Our Initiatives for Governance [G]In our Company, we have an idea of “right humanity” as judgement criterion for all of our
executives and employees to execute business assignments. We endeavor to strengthen oursystem of governance to ensure the execution.

Ratio of outside Officers 50.0% ratio of outside Directors 33.3%
Operate an equal Board of Directors where everyone can speak freely. Promote a sound Board of Directors with broad knowledge,
experience, and variety. In addition, they will attend important meetings such as the Executive Committee to ensure the soundnessof management.

We have established Nomination and Compensation Committee
We have established the Committee as a voluntary advisory body to the Board of Directors. The majority of the committee
members are outside directors to ensure sound management of the Company.
We have ensured our risk management at the time of acquisition of properties and our compliance with laws and regulations at thetime of their sale
We make a comprehensive business judgement, considering not only their profitability but also their risks, environmental impacts,
compliance and others. We have also established a checking system to identify risks in a broad context not only by ourdepartments in charge but in cooperation with legal and audit departments. As for sale of the pre-owned buildings which aredisqualified, we first make them qualified enough to meet legal compliance requirements and market them.

We conduct a monthly training on compliance
We give all the employees training on compliance in order to establish an efficient system of legal compliance. The training has abroad range of themes, such as “prevention of insider trades,” “prevention of trades with antisocial forces,”“informationmanagement,” etc. to promote sound business operation.
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

39

Sun Frontier Fudousan Co., Ltd.

ESG initiatives

Effective Corporate Governance System [G]Outside Directors and Outside Audit & Supervisory Board Members are expected to return their wide-ranging knowledge
and experience to the Board of Directors and play a role in improving corporate value. We promote a balanced corporate
management and corporate governance system based on our expertise and experience in each field.
Expertise and experience (skill matrix) * Up to 5 main items are listed.

Job title

Name

Corporate
management

Real estate

Accounting/
Finance

Legal/Complianc
HR/Labor/HR
e/RiskDevelopment
Mangement

IT/Digital

CSR/ ESG/
Sustainability●

M&A

Chairman representative
director

Tomoaki Horiguchi●●

President representative
director

Seiichi Saito

●

●

●

Executive Vice President

Izumi Nakamura

●

●

●

●

Senior Managing Director

Yasushi Yamada

●

●

●

●

Director

Mitsuhiro Ninomiya●●

Director

Kenji Honda●●(Outside) Director

Toshio Takahara●●(Outside) Director

Yukitoshi
Kubo

●

●

(Outside) Director

Kazutaka Okubo●●

Full-time Auditor

Kouichi Shinada

●

●

●

●

●

(Outside) Auditor

Koichi Moriya

●

●

●

●

(Outside) Auditor

Hidetaka Tanaka

●

●

●
●

●

40

●

●
●

●

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

●●●

Overseas

●

●
●

●
●

●

●

●

●

●

Sun Frontier Fudousan Co., Ltd.

4) Company Information and Reference Materials

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

41

Sun Frontier Fudousan Co., Ltd.

Vision and Policy
VisionWe aim to be “the real estate company” of the world’s most
loved, trusted and selected

Clients

Building owners, asset holders, wealthy individualsCore Business

PolicyStrategy

Real estate revitalization and utilization
・-Not for profit, but for trustChange ourselves, Solve difficulties from our clients’point of view
・Focus on people rather than property
・One-stop solutions to any and all problems
CentralTokyo

OfficeStrength

TenantEffective operation
mediation

Real estate
revitalization

Creativity
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

Sun Frontier Fudousan Co., Ltd.

Specialized strategy

Focusing on the use and revitalization of small and medium-sized office buildings in central Tokyo
Most of the buildings in Office Building Business are between 350 tsubo and 2,000 tsubo.
The main target of our business is small and medium-sized buildings, which account for 90% of the total number of buildings in central
Tokyo.
23 wards of Tokyo 9,293 buildings

Small-to-medium-scale

Large scale(total floor area of 300 to 5,000 tsubo)(total floor area of 5,000 tsubo or more)

8,538 buildings

755 buildings

Old earthquake
resistance standards:
2,199 buildings (26%)

Old earthquake
resistance standards:
132 buildings (17%)

Age of building(years)More than
20 years old:
7,447 buildings (87%)

Less than
20 years old:
1,091 buildings (13%)

More than
20 years old:
413 buildings (55%)

Less than
20 years old:
342 buildings (45%): Created by our Company based on “2020 Office Pyramid in 23 Wards of Tokyo
Number of buildings (buildings) Source(based on the number of buildings)” (XYMAX REAL ESTATE INSTITUTE Corporation)

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

43

Sun Frontier Fudousan Co., Ltd.

Trends in Vacancy Rate and Office Rents
in 5 Wards of the Central Tokyo
(%)

(yen)
Average rent (yen/tsubo)

The average rent
in December 2020

Average vacancy rate (%)

21,999 yen(-224 yen from the previous month)

Peak of thevacancy rate
9.43%
June 2012
Peak ofthe average rent
22,901 yen
August 2008

Peak of thevacancy rate
8.57%
August 2003

Bottom of theaverage rent
17,526 yen
October 2004

Peak ofthe average rent
23,014 yen
July 2020

The average vacancy rate
in December 2020

4.49%（+0.16%pt fromthe previous month)

Bottom of theaverage rent
16,207 yen
December 2013

Bottom of thevacancy rate
2.49%
November 2007

*Subjects are office buildings with a standard floor space of 100 tsubo or morein the 5 wards in the Central Tokyo.

Source: Prepared by our Company based on Miki Shoji’s “Office Reports.”

Bottom of thevacancy rate
1.49％
February 2020

*Source: Prepared by our Company based on Miki Shoji’s “Office Reports.” Subjects are office buildings with a standard floor space of 100 tsubo or more in the 5 wards in the Central Tokyo.

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

44

Sun Frontier Fudousan Co., Ltd.

Our human resources base that survived the 2008
global financial crisis is the cornerstone of growth(1 million yen)

70,00060,000We overcame difficulties immediately after listing, and have grown stronger
and more pliant than before the crisis, while increasing the number of colleagues.
売上高Profit701

Ordinary Profit
経常利益53,291

Employees
従業員数48,15050,00035,25430,62530,00026,87027,741276

20,00010,0000

16,730

612

700
600

47,463522

40,39440,000(number of people)

73,218800
70,00014,469

381

500
400

329

300

206
17,772 223

16,127200
12,813152
199
2 681 1,771
10,755141 142
10,5808,894
84 96 134 125
139 6,923
70
7,024
8,289 6,346
6,500 100
52
7,760
5,593
4,289
5,003
24
4,341
1
3,588
1,437 3,474
2,039
541 799
0 140 377 501 791(10,000)(20,000)
Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

181

0(3,776)(17,794)

45

(100)
(200)

Sun Frontier Fudousan Co., Ltd.

Corporate Profile
Company Name

Sun Frontier Fudosan Co., Ltd.

Location of Head
Quarters

2-2, Yurakucho 1-chome, Chiyoda-ku, Tokyo

Date of Foundation

April 8, 1999

Date of Listing

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

Capital Stock ※11,965 million yen

Representative

Tomoaki Horiguchi, Chairman
Seiichi Saito, President

Number of Consolidated 701 full-time employees (1,045 including part-timers and temporary workers)
Employees ※Average Age of
Employees※

34.5 years old
Real estate revitalization

Business Profile:Accounting Month
Listed Market

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

March
Tokyo Stock Exchange, First Section (Code number: 8934)
President
Saito(※As of now, the end of December 2020)

Copyright © 2021 Sun Frontier Fudousan Co., Ltd. All Rights Reserved.

46

Chairman
Horiguchi

Sun Frontier Fudousan Co., Ltd.

We will appreciate yourfurther supports.

Sun Frontier Fudousan Co., Ltd.

◆ 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 Exchange Act,
the Building Lots and Buildings Transaction Business Act, the Listing Rules for the Tokyo Stock Exchange and other related
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 cancellation 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